>> i'm mark crumpton. the measles epidemic in the united states has surpassed a 25-year-old record. is not clear when the illnesses will stop. the cdc says there have been 971 reported cases of measles so far this year. beene in 26 states have confirmed to have the measles but the vast majority of this year's cases have been in new york. a u.s. immigrants rights group says it has new evidence that the trump administration concealed the source and motivation behind a proposed question about citizenship on

next year's census. the new york immigrant coalition which is leading a coalition to bar the question says a redistricting consultant played a major role in the addition of the question. the group says the consultant theluded in a study that citizenship question would help republicans at the polls. coalitions asking a federal judge to let it publicly release redacted portions of the evidence and to consider portions of the united states. vice president pence says the u.s.,ade pact between the canada and mexico will pass this year. he made his comments during talks in ottawa with justin trudeau. he also shrugged off questions about whether the deal could win the approval of congressional democrats. justin trudeau introduced legislation to ratify the trade pact this week though he signaled that it will advance at the same time that it does in the u.s.. >> primary point of conversation

will be on the ratification andess on the united states canada trade agreement. -- to looking forward make sure the benefit of this which took a lot to which will be a win-win win for all three of our countries. hasice president pence attended years of rocky trade talks. the three countries signed the deal last year and earlier this month, removed tariffs on steel, aluminum, and other goods. india, someone has been sworn in as the prime minister. he won an overwhelming victory. today's ceremony was attended by several south asian leaders.

pakistan'sinvite prime minister, a sign that tense relations continue between the rivals. global news 24 hours a day on air and at tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. ♪ >> this is bloomberg markets. i'm scarlet fu. it is dreary out there. >> thunderstorms rolling in. we are 30 minutes away from the end of the trading day. we are trying to get back into the green. i don't know if we are succeeding. the s&p is up nearly 1/10 of 1%. the dollar is clawing back.

the two-year yields are continuing to fall. >> that is across the curve as well. >> we are close to 2%. let's move on and talk about banks because citigroup is getting an upgrade. goldman sachs is raising citigroup to buy from neutral. this comes as city and other banks including of america and jpmorgan warned of a slump in trading revenue. thank you for taking the time to speak with us.

let's look at these numbers. coulddimon said june dramatically change this performance. how likely is that for these big names? >> trading revenues are a little on a quarterly basis that they are steady on an annual basis. fixed income equity trading revenues for the big banks that $37ack have been between billion and $42 billion per year for the last seven years. on a quarterly basis, they can they or down 20% area bounce around a bit. the second thing to bear in mind is that trading is not as important as you might think. tradingirst quarter, revenues were down 14%. share were up 9%.

people worry about trading revenues and the yield curve. all of that is very tangential. what really matters is that they continue to be profitable. they are earning a return of 15%. there are only growing two or 3%. what is important is that they continue to be profitable and they continue to buy back stocks growth is low, it is 2% or 3%. >> a lot of investors are looking at this and saying what is the growth story? i understand you are saying they buy back shares and they support shareholders that way. trading, if have you don't have yields, what do you have? >> banks historically are gdp growers. that is one of the reasons why they have historically traded 75% of the the yield. they are at a huge distance to

that now. see is what you want to from banks. you want to see them growing slowly and gently. i get worried when i see banks trying to grow 6% to 10% per year. an economy that is 3% to 5%. this is better. this is a healthy. this is not the stuff the blowups are made up. >> we talk about the yield curve. the yield curve is inverted. it's not great for banks. who is it the least bad for? beyond city, -- >> people have blown the yield curve totally out of proportion. this is a very new and modern phenomenon. this is something the algorithmic traders of the world have given us this notion that

banks are tied to interest rates. the trading correlation has been extremely tight in the last it or six years. if you look at it historically, that correlation was not there at all. the 10 years before the crisis, there was no correlation like that. historically, if you look at return on assets for the banks, lowas generally higher in rate environments than in high rate environments. historically, banks were inversely correlated to interest rates. in the 80's and 90's, you were worried that interest rates were going to go up as you would be saddled with underwater bonds. rates do pension margins a little bit but they help you on credit because it means it is easier for the borrowers to make money. rates are an impact at the

littlebut it is like a dimmer switch that goes up or down. it is not like an on-off switch. the market is treating it like an on-off switch. what you find is, if you have 2% or 4% loan growth in a hostile rate environment where rates are low and the curve is flat, you will find that revenue growth is 1% or 2% below that. in a nice rate environment, it will be one or 2% -- what are two percentage points above that. it will matter as a margin but in the meantime, you are taking your share count down by 6% or 7% or year and that is driving the earnings. >> thank you so much. coming up, uber first quarterly results do today. they can now take on investor

concerns leading to a rocky start. this is bloomberg.

>> uber is set to release its first quarter warnings. joining us is emily chang. >> we believe we know a lot of the numbers they are going to report today. any surprise would not be taken well by investors.

i stood there on their ipo deep -- day. is this because of uber fundamentals because there is not a clear path to profitability? listen to what i was told that day. you go public, you cannot control how you execute the company. we are going to focus on what we can control. capital. a lot of we are focused on that. way, he is saying we have no excuses. we have a lot of money to invest and build and grow and the big question will be how he at the

color and put the meat on the bones. >> there is lots of skepticism when you look at the share price. we know they are going to report a net loss in the first quarter. the question is, the profitability for the court ridesharing services. about thatey can say is what investors will key off of. >> what is interesting in that interview is he would not commit to this being a peak spending your. -- spending year. they are saying that profitability is a priority but we want to know how they plan to get there. take a listen to what he told me about the profitability number. is a verybility

significant priority for us. look at the great companies of the world. they can grow off the base of their internal capital so to speak. want to be dependent on public markets for capital. this was a very important capital raise for us but believe me, we believe that our business can and should be profitable over time. >> a lot of the skepticism has to do with just how big is the ride-hailing market? can uber replace car ownership? they have other businesses as well. are some investors that are betting on a future of self driving cars. those are a long way out. if you think uber is going to be your big that because of autonomous vehicles, you could be waiting a long time. investors would like to see a path to profitability without relying on this futuristic technology. >> we will see what managers at uber decide to share.

thank you, emily. we look at markets right now, we have come back off of our lows. small caps have been performing. this is bloomberg. ♪

>> this is the count down to the close. joe weisenthal is joining us now. it you are focusing on something dark that makes cars go. obviously, it looks like stocks are going to close into the green today. about the economy and so forth is not going away today. we continue to see rates compressed. oil got hammered today.

i think that's what you're referring to. copper was week today. the commodity story is one of the big things. it's more of a weather thing. corn and wheat are up. is in thehe action commodities a. >> if you look at equities, it is a mixed tag. i'm looking at the best and worst performers. you have a few more defensive groups in the green. household and personal products, chipmakers. on the downside, oil prices. we showed you the drop. oil related companies are down for the day. >> you are seeing the 30 year

yield going the lowest right now it's 2016. equities, wemes to talked about how if yields continue to collapse, people will flock to equities. they are not flocking right now. we are of marginally. nothing to suggest the change has happened yet. >> a little bit more concrete from officials about being really do -- if we continue to get these trends -- >> at what point do rates not help equity markets? >> this is a big question. are moments away from the close. let's look at what is behind the numbers. >> i have looking -- and looking at gap. it is due to report earnings after the market close. it is on a three-day losing streak. areysts say investors

pricing in this weaker retail environment we have been seeing. a number of apparel retailers have had poor boards quarters. quarters. still, investors will be looking for an in-line report. we are looking at a chart that shows you sales across the main brands for gap. gap has been underperforming. the betterd been performer but they have come under pressure recently. morgan stanley says any missteps for old navy could not come at a worse time due to plans to spin off that brand. investors will be looking for more detail on that. they are looking for any detail that the company gives on demand and may due to concerns about weakness across the retail sector. oil and the energy sector on my mind. plunging down 3.8%.

this is as it declines in the month of may. that adds to the sense of risk off the we are seeing with stocks. today the energy sector down 1.2%. at the worst sector for the s&p 500, halliburton among the worst. we also have chevron lower. all areas of the energy sector are getting hit. what stands out from the end of september to last year, the energy sector down one and 20% in a bear market. sectorght be a bearish -- sign. i hate to pile on but another sector that has been getting hit hard are the steel stocks. they are all down today on a lot of concerns about price pressure.

sentiment coming out from analysts. steel stocks have been under pressure all week. we got data on monday about steel production globally on monday being up. seeing that being reflected in the price of steel itself. bloomberg intelligence saying the prices fell 9.1% in the month of may from april. there is a lot concern the prices are not working in the aber of the steel companies. they are dealing with the double whammy of import price -- cost. team great job giving us details on the

movements within the market. let's bring in our reporter for analysis. equities meandering. as abigailtumbling was a showing us. the bond rally continues. is there something bigger we can read from these moves? recession,re talking the market looks to be sending a signal that things are negative. this is the worst big rebalancing ever. data,ou look at economic it doesn't get the sense that everything is -- that the wheels are falling off. two-year 10-year is not inverted. it still seems like we will get preemptive fed cuts that allow us to avoid a downturn.

>> there is not a recession coming per se but is it predicated on the fed at some point taking preemptive measures? >> it very well might be. it might be predicated on the idea that trade is not going to go to your worst-case scenario. a lot of people are struggling to balance out, is the bond market screaming recession and the stock market is ignoring it. in the equity portfolio manager. one big question i have as we talk about the lower yields, how stimulative is this for risk as a customer is it not necessarily a contradiction for bonds and stocks to still rally at the i think weo mark >>

are getting different answers from asset classes and the big picture. if you look at u.s. consumer, since and that spiking higher, you look at regional indices and they are wobbly. you are getting a lot of different mismatches. that being said, all of this data put together can lead to analysis paralysis where you are inundated with so much information that you can't make any actionable decisions. this is the time for investors to take a pause and identify trends in the marketplace that aretransitory and maybe short-term in nature and causing this uncertainty while very well-founded uncertainty and others versus secular trends that we think are here to stay. as investors, in the equity market it has continued to be the best place to be and has

generated significant return for investors that have been in the market rather than timing the market. s&p returned over 15% and that. the key is coming you have to stay in. >> what a signal and what is noise? trade is the big thing in which there are a lot of headlines. is still inhe fed play. what is the stuff that you should ignore and what should you pay attention to? >> it is difficult to ignore anything these days. we are forced to trade around all of the tweets and data points. investors andr our analysts to do is to project out and think about how the world will look at 12 months to 18 months from now.

to your earlier point about they have taken a beating of because of geopolitical questions and questions about growth overall, but there are areas of the market that should continue to do well irrespective of the backdrop. lower,wth rate will be but significant better than the market itself. tech, health-care care, consumer and pockets of communications services. scarlet: you had a market managing to close up, something of a rebound we anticipated after a couple days of pretty steep losses. on a sector wide basis, pretty positive, a pause for breath in that way. joe: it looked like we would have another day that started higher and turned lower, but i

guess the fact we are in the green is something. lisa: talking about numbers coming out of gdp not revised as low as possible. scarlet: and more data coming up, tomorrow, which will be something bond investors in particular will really pay attention to. still with us right now is yana barton of eaton vance, and bloomberg's luke kawa. luke, when you look at the volume, how much are you paying attention to that? , we opened was also the week essentially smack dab in the middle of the 50-day and the 200-day, and we could have

gone either way. we traveled to the 200 day pretty fast, and it seems conviction is pretty low, and selling doesn't seem to be panic-driven or emotional at all. but one element that leapt out, 10-year yields down three days in a row, utilities down three days in a row. if you are ditching bond proxies to go to bonds, i suspect the motivation is similar, probably means the general view on equities is getting sour even as we rebound. talk about i want to the timeframe of investments, --ause- you said you18 because you said you encourage clients to look 12 to 18 months out. are you in this market at all? what would it take for you to get in? yana: thank you for the question. as active equity growth manager our job is not to time the market or even asset allocated. we are fully invested.

but depending on the backdrop, hithin our focused growty strategy we have options to exercise across all sectors of the market, and this is the opportunity we are looking for. the s&p 500 is up almost 12% year-to-date but it certainly doesn't feel good, and i would argue some of these returns are twice what most investors would expect from the s&p 500, which kind of talks about this dispersion we have seen, where investors don't know how to get positioned for this. which is why i think in equities it is a long-duration asset. you have to give yourself some time. if you are trading around all these data points, when you look at time-weighted versus dollar-weighted, you will find you are missing a lot because you are losing the long-term points. we see opportunities within the consumer space, pockets of opportunities, e-commerce, also

subsets of the auto space, auto components. within industrials, parts of which have been decimated by the cyclical trade, economy not growing, the parts of the market that are growing and benefiting from housing recovery like building products and repair and remodel market. technology remains a sweet spot for us. cloud computing, cybersecurity and others. and health care, it is the worst performer to date, and is trading at an 8% discount to the market. but when we look at statistics overthe fact there are 10,000 folks turning 65 or older on a daily basis, and that statistic will continue through 2030, we will be consuming a lot more health care. that's an area we are intrigued with that has been sold offer other reasons. joe: back to what you said about car parts. that's an industry in which you

never hear anyone say anything good about it. layoffs,, car business models are terrible. so it is interesting and sounds contrarian unlike cloud computing or health care which have more fans. what are people missing about the auto industry and suppliers? scarlet: we just have uber results coming out, the first set of results since going public. first quarter adjusted net revenue two, $.76 billion something they had telegraphed -- 2.76 billion dollars, something they had telegraphed, in line with the analyst estimates. of course a lot of analysts could not give estimates because their banks were involved in the ipo. first quarter adjusted ebitda loss $869 million, estimated loss of $900 million, working with a small pool of estimates. gross bookings $14.65 billion. earlier uber indicated they would have gross bookings of

14.4 4 billion dollars to 14.6 4 billion dollars, so within that range. joe: one key thing about gross bookings as eric newcomer knows, but downhigh sequentially. this is a company that has been around for a while. thethe growth rate -- while growth rate is impressive, it has been decelerating. , but atd losing what point are they not surprising enough to disprove bears? there are so many out there. to shares borrowed in order short. scarlet: he short interest is 23%, compared to 18% last year. also rising in after hours trading, uber shares, so it seems to be good enough for

investors. lisa: we will talk more about uber, but i want to bring you auty,o beauty -- alta be beating estimates in earnings-per-share although the earnings-per-share of $3.26 versus $2.70, but included a benefit due to tax accounting, and you sell comparable sales not increasing as much, up 7% versus an estimated 8.1%. a little disappointment at a a hot market.s is scarlet: the ceo and cfo of gamestop will be leaving the company and gamestop will eliminate the coo role. we have

♪ romaine: live from bloomberg world headquarters in new york, i am remain bostick -- romaine bostick. lisa: i am lisa abramowicz. joe: i am joe weisenthal. romaine: you can see the indices rebounding off of lowe's to cloe modestly higher. joe: the question, "what'd you miss?" reports its first

result is a public company, and we are scouring the numbers. and eric brown explains why playing poker might lead to better investment decision-making. and 24 contenders and counting. montana governor steve bullock makes his case for 2020 a very crowded presidential field. at uber inake a look its first financial report as a public company, with first quarter sales near the high-end of previously disclosed play luminary -- preliminary results. joining us is mandeep singh, who covers the company for bloomberg intelligence. we kind of knew where the numbers were headed based on when they went public. anything in this report today that gives you any idea of anything different? the bookings number was at the high-end of the range, and that tells me the ridesharing market, at least

topline momentum is still strong, and uber is executing well. they are using a lot of subsidies. what you see, which is slightly surprising, is they are reducing rate and aggressively getting into the food delivery business, which grew over 100%. and i think right now the key issue for them is driver retention. they are reducing take rates because they want more drivers on their platform. joe: is that sustainable? mandeep: leasing about marketplaces, once you have the core base of users, and uber is probably the largest player in ridesharing, i think what they are trying to do is basically make sure the smaller players in food delivery, even for that matter lyft which is really smaller than uber, weeding out competition by boosting scale. you have seen that with amazon and alibaba, you get the network effect and it is hard to

dismantle after that. more so why are shares up in after hours trading? did they not get the memo that you are supposed to say something really low, set the bar really low and then hurdle over it triumphantly? mandeep: again, it was kind of expected. in this case there wasn't much surprise, although the higher end of the range was positive. i think what they have to show is execution. right now the strategy seems to be, let's use subsidies and make drivers.aintain that is a problem with the asset light model. drivers are free. they could drive for lyft or the food delivery guys. how do you keep drivers? they are thinking of banning users with low ratings, which you can do with the data you collected to make the experience better. lisa: i am sure we will talk much more about this coming up. madeep singh, bloomberg

intelligence's ridesharing expert. morgan stanley's ceo says markets are fragile and they are worried about the trade war but do not think that a big selloff is likely. he spoke to bloomberg television in an exquisite interview in beijing -- exclusive interview in beijing. >> the probabilistic risk is that they have more downside than upside, but the magnitude is not big. i don't think we are looking at a collapse, just taking some of the excitement out of the markets that has been building for the last six months. lisa: joining us now is barry banister, joining us from baltimore. agree, that we might see a risk-off move but it won't be anything huge? barry: we believe the s&p is airly valued at about 2,750, a possible range being one multiple point around that. i am below the street on earnings estimates, $156 using

the s&p is the base, s&p's and the street is 100 $66. there will be some -- 106 $26. there will be some his appointments in earnings. they have to drop the yield close to 2%, and that will get the fed's attention and we will get rate cuts. also expecting a trade deal by ifut november, especially unemployment is going up before 2020. romaine: a lot of folks were pricing in the idea that we would get a pretty significant rebound in eps growth in the second half, but based on your estimates it doesn't seem like that's going to be a strong. valuations justify that? barry: the first quarter was mid-teens, and our model was forecasting that. the street came up to us.

that was in line. if you look at the last three quarters on a dollar basis, we are at about $40 and the street is a good a seven-plus dollars higher than us. so when you look at the lack of sequential lift off particularly in the back pass -- back half, and you will likely hear about that in second-quarter earnings calls, that is where you have the effect. joe: we have seen this escalation in the trade war lately where it has gone beyond tariffs to sort of asymmetrical conflict. the u.s. threatening to essentially try to kill huawei, china responding with threatening over rare earths. it seems we are in a new stage that won't be easily resolved even if trump and xi personally like each other and want a deal. is this something that will change the way that markets and investing work for a long time, perhaps years out? it is really starting to feel like that is the tone of a lot of people in the market. if you look at the

powers over trade in the hands president,ce of the they were all conferred between about 1966 and 1977 during the cold war. and now we are not in the cold war with the soviet union, but there is kind of a call it a tense rivalry with the chinese. so no future president will give up those powers, and it will be hard to get the majority in congress to repeal them. as a consequence of that, and override a veto. as a consequent of that the president will have a lot of power over trade. it is a populist notion, and it will be adopted by either party in the coming years and will be with us for a long time. lisa: one thing that you said initially was that you do think wil worsening economic data to cut rates.e fed how supportive is that for risk assets? i sound look a broken record, but i keep asking, i don't understand if it will be good

news or bad news for equities. barry: in a sense, bad news is what it takes. as i said, you have to break some eggs before the fed turns chicken, so you have to have some bad data come out. i expect inflation will be very disappointing, and core pci will stay under 1.5. we get news on that tomorrow, but looking at gdp data today, 1.0 on quarter on quarter annualized, and expectations were for 1.3 encore pce -- on core pce, quarterly annualized. so low inflation raises higher real interest rates, and higher real interest rates lower the price to earnings multiple, so that kind of put the danker -- put a damper on the market. i agree the market is fragile but i think it is an arrange -- in a range broadly speaking 2750 oriple around, so plus or minus 150. lisa: thank you so much, barry

bannister of stifel. some breaking news, gaba earnings coming across the tape and not what people want to see. -- gap earnings coming across the tape and not what people want to see. versus an estimate of two $2.14, so.14, -- shares taking a beating after hours, down 10% at one point. this is a company that has struggled for a while. joe: for two decades. [laughter] romaine: does not give investors much hope. hours, at costco after results largely in line with estimates, eps a little higher at $2.05 versus $1.70, and on revenue they matched estimates at around $34.7 billion. joe: coming up, we look at how bing.

bing? that is the underdog generating nearly three times the advertising revenue of twitter. that's next. ♪

microsoftweek in 2009 rebooted and renamed its effort to counter google's search engine, known as bing. it didn't exactly get off to the best start. fast forward, 10 years later and the website generates almost three times as much as twitter. i learned two really interesting things today and one, bing is now a real moneymaker for microsoft, and romaine, you use bing? [laughter]

i haven't heard anyone talk about it. >> every three years i like to remind people that bing exists. [laughter] joe: romaine needs no reminding. >> part of my point, this business was kind of the laughingstock of the internet, microsoft's attempt to counter this big monster of google, and at least on that strategic goal it is a failure, right? isgle is google and bing relatively small in comparison, but bing brings in about $7.5 billion per year in advertising sales, three times the ad sales of twitter. and it's a nice little business for microsoft even if it doesn't have huge market share in search. romaine: i think comparing it to google is a little unfair for a variety of reasons, but how does it fit in within the ecosystem of microsoft? we think of them as selling cloud services, microsoft software, so how does bing fit

in? shira: for me it is a head scratcher for me it is a head scratcher. nadellat under satya has really focus on the commercial software business, windows software and cloud computing and microsoft office to companies large and small. and bing doesn't fit naturally into that ecosystem. but at the same time, if you talk to executives at microsoft, they say bing provides strategic value. they learned about crunching huge datasets which was valuable for the empire. you: i am sorry,, romaine, are may be the first person i've ever met that bing is their go to search engine. it makes me wonder about how microsoft is using their size as a way to push out bing in different places, the default search engine on certain microsoft computers. does this sort of reflect how

, how difficult it is for smaller upstarts to consolidate even if they offer a better product? isra: the reason bing successful is not necessarily because it is better, although romaine believes it is. it's because microsoft has a huge audience of people using microsoft office and windows computers, and if you do any searches through the built in search bar on the windows 10 computers, you are using bing, even if you aren't actively using bing. that has been the strategy. we don't need people to go to bing.com. we will go to where people are. on windows computers, on yahoo! and aol websites that have a lot of traffic, and bing there is the built in search engine and they are the ones serving ads when you are looking for local dentists or running shoes in your neighborhood. joe: i would love to do a whole show on bing.

[laughter] but there's other things to follow. uber's? first report, any takeaway? s -- any takeaway? shira: the fundamental question for me, how big can the on-demand ride business get? uber has said we are 1% or less f all trips taken by cars in the world. my rebuttal to that, that sounds good, but if that's true, why isn't it growing faster? if you look at the value of ride booked on uber's on-demand ridesharing service, it is not growing very fast for a company you would expect to be a high-value growth company and uber is making up the difference through things like uber eats, which is growing very fast but is wildly unprofitable. that is a potential question. first-quarter numbers showed again that the core on-demand ride business is significantly

slowing even though uber is growing. lisa: you will have to come back and do our full hour special on bing. [laughter] romaine: don't be a slave to google. lisa: breaking news, u.s. high-grade bond funds with their biggest withdrawal since 2015 as the extra yield investors demand to own debt rises the most since february, so a bit of a risk-off. romaine: and also a few retail earnings. we mentioned gap, shares by 4%., missing costco results largely in line with what the street was expecting their, and then you see williams-sonoma here, actually a winner. i didn't know people still shopped there. lisa: i shop there. romaine: there you go. we all have our own idiosyncrasies. [laughter] my interviewp,

with montana governor and presidential candidate steve bullock next. this is bloomberg. ♪

mark: i am mark crumpton with bloomberg first word news. president trump says tariffs imposed by the united states are having a devastating impact on china. the president spoke to reporters today leaving the white house. >> china would love to make a deal with us. we had a deal, and they broke the deal. i think if they had to do it again, they would not have done what they did. we're taking in billions of dollars in tariffs. products,ubsidizing so the united states taxpayer is paying very little on it, and if you look at in place and -- inflation and pricing it has

gone up little. mark: meanwhile, the trade war is escalating. bloomberg has learned that beijing is putting purchases of american soybeans on hold. grain buyers have not received orders to continue with so-called goodwill buying and they don't expect that to happen because of the lack of progress in trade talks. president trump and his acting defense secretary are distancing themselves from in order to keep late senatore for john mccain out of sight during the president's recent visit to japan. secretary shanahan spoke to reporters in jakarta, indonesia. >> i would never dishonor the memory of a great american patriot like senator mccain. also, i think it is important, i'd never disrespect the young men and women that crew that ship. mark: president trump told reporters the white house -- at the white house today that he "was not a big fan" of the

senator but he was not involved in the matter. protests in sudan threatened to launch a civil disobedience campaign to pressure the ruling military government to hand over power to civilian governments. and thetween protesters military about the transfer of power remained stalled, more than a month since massive protests threw long time ruler rom power.shir f lawyers for the man accused of killing 11 people at a pittsburgh synagogue says the fbi has been discouraging witnesses from talking to the defense, undermining their right to a fair trial. the defense is asking the judge to tell the bureau to stop what they say is improper interference in the case. officials say the gunman opened fire with an ar-15 rifle and servicespons airing inside tree of life synagogue, killing eight men and three women. global news 24 hours a day, on

air and at tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. montana governor steve bullock was one of the last major democrats to enter the race for the white house, and he hopes cross-party appeal can lift him to the nomination. he joined me in the studio earlier today. gov. bullock: i am the only one in the field who actually won in a trump state with trump on the ballot. he took montana by 21 points in 2016, and i won by four. 25% to 30% of my voters voted for donald trump, and if we can't win back some of the places we lost in the last election and bring it our base, trump will be president again. joe: what is it you did? what is the argument you made to trump voters in montana that resonated? gov. bullock: sure, and this argument is more than about electability from my

perspective. how i get things done, because my legislator is about 60% republican, is that folks don't agree with everything that certainly i stand for, but i go out and i listen, i try to understand their life, and i also say both here is where i want to go from a policy perspective, even if people might have differences. because we want the same things. we want a decent job, we want a roof over our head. we want clean air, clean water, safe communities. and having the conviction to go to places not just among democrats, but talking to business folks, to people all across, is how i get people that often might not agree with everything that i say or stand for but believe that i will fight for their best interest. joe: do you believe there is still a big appetite within the democratic party for that sort of cross-partisan outreach? it increasingly feels as though there are some people who want

to give up on the idea that's even possible. gov. bullock: we are now at a challenging time in this 240-year experiment of representative democracy. first we need to beat donald trump, but then we need to make d.c. work again. i was attorney general for the governor, and in a post-citizens united world, outside money has made washington d.c. so it cannot move on anything. joe: and to be clear, this is sort of what you called your main idea, the main idea of your campaign in terms of getting money out of politics, changing who has influence? gov. bullock: changing who has influence. when we pay more for drugs and health care than any country in the world, yet we also can't even negotiate drug prices. or when we can no longer even talk about climate change, because the outside interests. republicans use to at least

acknowledge that the climate crisis was real and we had to do something about it, but now you can't even get a republican to say that we must do something about it. you look at a whole generation of workers, replaced by independent contractors, and union membership is about half of what it was in the 1980's. and i think a lot of really is you have toare , deal with the outside spending elections. joe: ok. you have made the case that you have the best shot at winning back a lot of these trump voters, trump states. however, howimary, do you break out of such a crowded field? gov. bullock: first of all, i break out because not only do we have to win, we have to govern. as a governor, most of the issues we will talk about over the next year and a half i have had to deal with. health care. i've had to deal with education. tanans as a percentage

have moved into the middle class than any other state in the country. i've had to deal with the fact that not everyone will go to college, so we made our two-year colleges offer professionally recognized certificates and there's a thousand apprenticeable fields out there. from that perspective my experiences different.i think geographically i'm different. if we ever want washington to work, it is about more than 270 electoral votes. joe: how important is it for your campaign to make the first debate, do you think you will make it, and will you drop out if you don't? gov. bullock: as long as people go to stevebullock.com, i will make sure i get on the debate stage. i sure hope i make the debate, and i think unfortunately they are even starting to change the rules so that it is more about paying direct-mail firms and things to get individual donors that it is about talking to people, which is concerning. i still hope -- sure hope we

make the debate, but we have a long way to go. four years ago, scott walker was number one, jeb bush was number two. we saw what happened. i think i am an important voice on the debate stage as the only person who actually won in a trump state and has gotten progressively done. but whatever happens in a month, that will not shape what i'm doing. joe: obviously the bar is very high and even higher for the second debate in terms of the number of individuals. but if you don't make the first debate you would not necessarily drop out? gov. bullock: yeah. disadvantaged.am i only got into this two weeks ago because i had a job to do and my legislator was going on at i had to get medicaid reauthorization and freeze college tuition. hopefully we get there by the number of donors, by the polling, but even if not, this conversation will go long past the next month for sure. joe: after, let's talk about some of the issues and topics people are debating. do you think president should be

impeached? gov. bullock: i think congress needs to fulfill its full oversight authority of the executive branch, and interestingly enough the executive branch has to comply. saying we won't even send people there? but two days ago i was at five different stops in iowa and people were talking about health care, jobs, tariffs, the soybeans in the bin. not talking about impeachment. i would much rather be focusing on what folks need for the next year and a half, not sort of the squabbles. that's not to accept the behavior of this president. we shouldn't normalize that. but we ought to focus on things that impact people's lives, and that is what we should be talking about. joe: you mentioned soybean farmers. what do you make of trump's approach to dealing with china, and what would the ideal trading relationship with china look like under your presidency? gov. bullock: i met with a guy

this last week who lost 140,000 dollars this year. yeah, we will get $70,000 back from the usda, but we are losing 70 grand and we will lose those markets permanently. i think we need to be tough on china, and this has been something that didn't start yesterday, right? this started when we gave them mfn status, but we can't go it alone. just using, i say he's playing checkers, 25% increase in tariffs, that won't just affect farmers but every family in america to the tune of $2000 a year. so you can't just use the blunt instrument of tariffs when they are playing a long game of chess. we have to get their markets open. joe: so what specifically? obviously trump has done more than tariffs, because now we see the administration going after some of their tech giants, things going beyond merely

raising prices. what are the long-term tools an administration could used to as you put it improve the playing field? gov. bullock: and i think certainly you have to get enforceability from the wto. that's not enough, if they are not opening their borders not just to u.s. goods, but also goods from around the country's. -- countries. when you have a different status for getting into the chinese market, our allies and some of our adversaries have to come together. trump has kind of made "america first" into "america alone," and i don't think that is working. china first did this with the steel industry, putting up borders, subsidizing an actor and then unleashing it on the world. and then they did it with credit cards, and then with microsoft -- microchips, and now with tech. we certainly should not allow or require the tech transfers we have seen but the u.s. can't do

this alone by any measure. joe: last question. you mentioned fighting for medicaid expansion in your state. where do you stand from a national perspective? medicare for all gaining momentum, debates in your party about the existence or role of private health insurance. where would you like to see the national health insurance system go? gov. bullock: i think health insurance or health care ought to be accessible to all and affordable, and affordable both to the individual and also to the federal government. so what i would propose, a public option, negotiating drug prices, getting rid of surprise medical billing and out-of-network care, but not necessarily disrupting the 70% of folks that have employer-sponsored health care. we should make that more affordable, but i don't think at the end of the day completely here.ng a system that is maybe if you were starting from scratch, but that's not where we are. joe: that was my interview with montana governor and presidential candidate steve

bullock. coming up, the market -- is there really a personality trait that helps fund managers? opiniond to bloomberg's columnist aaron brown about what skills translate to better returns. this is bloomberg. ♪

good poker players make good hedge fund managers? academics are trying to answer that with a new research paper. bloomberg columnist aaron brown considered that in our latest piece. he joins us by phone. former head of financial research at aqr capital management and the author of a great book, "the poker face of wall street." poker are an avid player with experience in hedge fund management. what does the paper say and why would there be a connection between poker playing and generating alpha? aaron: that's a great question. when i talk to people about the paper, you get two diametrically opposed views. people who say that poker is exactly like hedge fund management. you have calculation under pressure, you have money management, you have psychological insight. and then people say it is totally the opposite. a hedge fund manager is very

careful, risk-reducing numbers person, and poker is a risk-seeking activity, it is gambling, exactly the opposite of what you should do. well, three academics decided to try and find out. they did a very good, solid piece of research that shows indeed that hedge fund managers who are good poker players get more alpha, produce better returns for investors, better risk-adjusted returns. and one interesting part of the paper, it only seems to help for the fundamental managers, so people like david einhorn, george soros, or if you watch television, bobby from "billions." those seem to be the kinds of managers who benefit a lot from being good poker players. quantitative managers, the careful number guys who minimize risk first, your jim simon, people like that, there you don't see the correlation much. they seem to do a little better,

but not statistically significant. so it does seem as though poker playing skill helps people do better in hedge funds. lisa: what is interesting to me, there's a larger point here, are there personality characteristics that make people likely to be better at the sort of gut decisions and risk-taking that tends to be more accurate? what does that tell you, in terms of how people should go about figuring out what investors to go with? aaron: that is really the point of the research. i don't think we care too much about whether poker specifically is great for hedge fund managers. but one thing it proves, performance is not random. some people will tell you it is -- allk, paul marketing, no skill to it. if they were no skill to it, the poker players wouldn't do better than everybody else. and it also tells you about the skills that help in this, and the fact it overlaps with poker skills is in fact very interesting. people studied a lot of things

exist, kind of an emerging literature. the most famous paper, hedge fund managers who drive powerful sports cars take more risks but don't get better returns on a risk-adjusted return basis, do worse. so these are intuitive results. surprised, but it tells you it is not all processes, but the managers' gut feel seems to matter. romaine: one of the more interesting points in the paper, they talked about how poker is a game of incomplete information, comparing it to other games like chess. the idea, chess players would not necessarily make the best fund managers, at least in the context of the research. what other comparisons do they make here? aaron: i think that is a good point. and i don't have the numbers on it like we do for poker, but i know that a lot of hedge fund managers are master chess

players, also people who enjoy bridge. and there are different kinds of managers. your poker-playing managers tend to be the fundamental managers, people sizing up unique situations and doing things. it will be interesting to see some research on bridge players, chess players as well. i would guess that we would find that they do better on the technical, quantitative, systematic. . -type management but this paper poker.dresses it would be interesting to see, if what people do recreationally tells how good a manager they would be. romaine: interesting to see what research comes out of this. opinionown, bloomberg columnist and former head of research at aqr capital management. coming up, troubles mount for gap as sales plummet across the board. we discussed that next. this is bloomberg.

♪

romaine: a quick check of the latest business flash headlines. hsbc is cutting hundreds of investment bank jobs. at least 500 jobs could go in global banking and markets as the ceo pushes top managers to cut costs after the bank missed a full-year target of increasing revenue more than expenses. the parent of calvin klein and tommy hilfiger fell the most in a decade today, reporting the escalating trade war is causing anxious american and chinese shoppers to buy less. international sales make up over half of their revenue. the owner of la croix seltzer, national beverage, is lower after guggenheim cut their price target on the firm, saying sales are effectively in a freefall. they face increased competition in the sparkling water category, among rivals coca-cola,

pepsico, nestle. i have a feeling you call this? joe: my only good tweet ever, and i have a lot. september 2017 i tweeted, i am over la croix, because i was into it like a bunch of people, and then i drank some, this isn't very good, and i tweeted on the very exact day that the stock peaked, so you can go. i said, by the way, i am over la croix. lisa: do your victory lap. joe: and there is the chart showing the stock. my only claim to fame. lisa: congratulations, joe weisenthal. meanwhile we focus on gap, shares plunging after declines spread to old navy, calling into question the the rationale behind the planned spinoff of the brand. here to take us through the results, our bloomberg intelligent senior retail

analyst. gap,e turnaround strategy for after all the struggles, still not going right? >> sales were down 10% in the last quarter. you can blame the weather, but we think it is beyond that. a 10% sales drop is a little too much. can gap turn itself around? it's about product, but also where you sit in the marketplace and what the consumer demands, and the consumer today isn't looking for a place to shop for basics. romaine: one thing, the old navy brand of this particular quarter came in below what a lot of analysts were expecting, with a drop in sales. i thought they would spin off old navy. >> that is still the idea. they still plan to spin off old navy, the transaction hopefully closing next year. but old navy is the discount banner which is still doing well. comps are down 1%. romaine: do people know that, do they differentiate gap from old

navy? >> they do. navy, the same shoppers of walmart probably shot old navy. joe: will this company be around another 20 years, having gone nowhere? it is trying to get to where it was in 1998. not going to die, not going to revive? >> there is a place for everyone, but it is how big they will be. they have been shrieking stores at least at gap, but expanding at old navy, and that is still performing better and there is still a chance for old navy to recover. for gap, the struggle is much bigger. hopefully they can get something better on the earnings call. goyal, thank you so much for coming on. don't miss this, the democratic party of california state convention held in san francisco where most of the many 2020 democratic residential candidates will attend. joe: and i will be watching u.s. economic data, consumer sentiment and pce for april.

romaine: and our interview with minneapolis fed president neel kashkari. that is all for "what'd you miss." "bloomberg technology" is next in the u.s.. joe: have a great evening. this is bloomberg. ♪ the latest innovation from xfinity

isn't just a store. it's a save more with a new kind of wireless network store. it's a look what your wifi can do now store. a get your questions answered by awesome experts store. it's a now there's one store that connects your life like never before store. the xfinity store is here. and it's simple, easy, awesome.

♪ emily: i am emily chang in san francisco, and this is "bloomberg technology. " resultsorts its first but does not share guidance. losses widened to $1 billion. we have it all. facebook shareholders pressed for more checks on ceo mark zuckerberg's power. highlights from the annual investor meeting. disney's