dalio in conversation with erik schatzker. coming, james gorman will join us later in the morning, of course after earnings. for more importantly, a conversation with mr. gorman. coming up, andrew sheets of morgan stanley. please stay with us. this is bloomberg. ♪ francine: good morning, good afternoon, good evening, everyone. this is "bloomberg surveillance ," your insight into politics, markets, and economy. let's get to andrew sheets. good morning to you and thank you for joining us. we were talking about market reaction. they are looking at infections, a lockdown easing. are you worried that the markets are getting ahead of themselves? andrew: i don't think the markets are getting ahead of themselves. i think risk premiums across a lot of asset classes are still attractive. obviously we have rallied back fast, but i do think broadly the valuation picture is fine. but i do think actually the biggest risk is that it is tempting to think that kind of a faster reopening is a good scenario for markets, that the faster that thin

ray dalio says investors would be crazy to hold government bonds right now. the founder of the world's largest hedge fund says he has no choice but to spend trillions of dollars, but with so much money printing by central banks, he questions it. he found himself on the wrong side of plunging markets after he said cash is trash. in israel, rival leaders failed to reach a deal, that means a fourth election in little over a year. and dan'setanyahu decided not to ask for more time. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. thank you so much. president trump will unveil guidelines to reopen america. he made those comments in a press conference yesterday. >> the data suggests nationwide we are past the peak on new cases. hopefully that will continue, and we will continue to make great progress. these encouraging developments have put us in a strong position to finalize guidelines for states on reopening the country, which will be announced, we

our interview with ray dalio is next.his is bloomberg. ♪ shery: bank of america, citigroup, and goldman reported the pandemic's impact on their earnings. a major trend is emerging. trading debt helping to salvage profit. the details now. this was particularly true in terms of the trend for goldman, which saw its trading business sore. >> in fact, their trading revenue came in at $5.2 billion, a 28% surge into beat expectations. it started to offset a lot of damage. it follows on the heels of jp morgan also coming in with a very strong trading quarter. but if you look at the charts on how these banks did today, while goldman ended higher as opposed to bank of america and citi, it was down as much is 5% earlier in the session as it recorded and almost $900 million hit and that contributed to a 46% decline in profit. let's hear from the ceo of goldman about what is ahead. >> there is obviously a wide range of uncertainty around forward projections given the unknown duration of the health crisis. the reality is that none of u

billionaire investor ray dalio sell things cash is trash. there are assets to hold, among them gold and some stocks. he is concerned by central banks renting money and keeping interest rates low. printing money and keeping interest rates low. global news 24 hours a day, on air and @quicktake on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. hurtado.ana tom: thank you so much. this is a major story that we see wuhan after seven weeks coming out of lockdown. stunning 55,000 person leaving wuhan. -- richardricher :00 lacaille. one of the things i see in the investment space as if you will be in the market, what will you be in? there seems to be a consensus call to buy quality, but what i find fascinating is what kind of quality showed one own forward? -- should one own forward? richard: maybe it is a little but those with strong business models and balance sheets are less dependent on shutting down and worrying about liquidity problems than others. in the end, it comes down to longer-term quality questio

ray dalio says you would be crazy to hold bonds. blackrock wants to hold bonds.ng interest-rate volatility which caught my eye. they are going longer duration. this would be monumental if the u.s. paid the drillers to keep the oil in the ground. that is what caused the double inflation. these markets need an oil rally to help them move a little bit higher. let's talk about the data. got the global confirmed cases of coronavirus that have reached 2 million. nejra: we have. we will come to that update in a second. i need to say that tsmc first quarter net income comes in at 116.99 billion. that beats the estimate of 109.73. you can follow those earnings. that is better-than-expected. a lot of people saying, the first quarter is backward looking. what we are looking at is any guidance that we get on the future quarter. tsmc facing a challenging market? we spoke to the asml the deal. they see a lot of resilience in terms of orders. the first quarter growth market comes in at 51.8%. -- margin comes in a 51.8%. manus: it does. it will be important. let's get back to th

we would also talk about ray dalio, who says it would be crazy to own bonds right now.ore about why from him. bloomberg.is is ♪ ' anna: welcome back to the european open. decent day of gains for the european equities this morning. very decent gains on the ftse mib, up 1.8% on italian stocks. let's get a business flash morning.r your this -- u.s. president trump is considering paying drillers not to drill oil, compensating companies sitting on as much as 350 million barrels of oil reserves. west texas crude futures settled below $20 a barrel yesterday for the first time in 18 years. reportedmiconductor demand for advanced silicon remains steady, thunderstorm resilient -- underscoring resilient demand in data centers. the data comes despite warnings from tsmc's top consumer, apple, of a slow and lower demand in china. has banned france in shipping of nonessential goods from amazon. amazon has been given 24 hours to comply and upgrade security. your bloomberg business flash. matt: ray dalio of bridgewater associates says it would be crazy to hold bonds right now. he spoke

coming up, ray dalio still thinks cash's trash -- cash is trash.oward marks says it is time to stop playing defense. up next, more from those big voices. this is bloomberg. ♪ ♪ economics, finance, politics, this is "bloomberg surveillance." let's get the bloomberg business flash. viviana: we begin with a pledge of $1 billion of his stake in square from twitter cofounder jack dorsey to help fight the coronavirus. it is the largest pandemic related donation yet. mr. dorsey says he hopes it inspires to do the same. he has a net worth of $3.9 billion. both of that is made up of equity in twitter and square. heineken abandoning its plan for the year. first quarter beer volume dropping about. 4%. . total volume, include soft drinks, falling 4%. u.k. businesses are struggling to access the cash promised by the government, according to the british chambers of commerce. just 1% of the companies surveyed vanished to access the chancellor's new scheme. beenid they have unsuccessful, many setting the complexity of the operation and in some cases, no answer at

erik schatzker is speaking with bridgewater associates' ray dalio. and the way of fiscal stimulus from the federal government and monetary stimulus from the federal reserve, are both of those organs of the u.s. government doing what they should be doing? if they are not, what else should they be doing? ray: and my reaction, there is no choice. the 2000 eight financial crisis, you are faced with a choice. do you want those banks to exist in the future, or do you want to get rid of those banks? they may not have had enough savings and they may have done things that they should bear the consequences of, but you want to save the banks. that isis a crisis similar, except it goes way beyond the banks. so when you start to think, who , you have too save think about do you provide them with income and how much you deal with their balance sheet. and if you don't come of consequences are enormous. ofthe reaction needed to be the sort. we have to think about the consequences, though, of producing all that money and credit. where does it come from and what does

haslinda: ray dalio from bridgewater associates.and huawei concern for investors. the first earnings call since the pandemic. ♪ set to givepmaker investors a key health check on the tech industry. have techfrom now, we reporter debbie wu in taipei. what are we looking for? what will investors be focused on on this earnings call this afternoon? >> right. are its twoawei biggest customers. to use theill want call to find out a hint of how apple and huawei are doing. apple has controlled its guidance for the current quarter. hoping they will be able to provide some color, some s iphones mayapple' be doing. investors will want to find out if much the impact could be washington limits their sales to huawei. capital: how about expenditure? what do we know? expenditure is a frequent indicator of how should demand will be and the company said in january that it expects for this year to be a record 15 billion dollars to $16 billion, but there's the possibility chipped demand may take a hit and several tse -- tsmc equipment makers have withdr

dalio, bridgewater associates cochairman and cio, he will join us at 10:00 a.m. new york time.e will be back in a moment. this is bloomberg. ♪ romaine: keeping an eye on rising a little bit after hours. dow jones headline saying that the treasury department in the u.s. and airlines have agreed on principle to some kind of aid package. so here itt 2% or after hours trading. care andn to health johnson & johnson. bloomberg spoke a little bit earlier with the cfo of johnson & johnson about the outlook. >> with respect to the vaccine, thing continue to progress. identify a lead candidate with two backups. we are now doing lead research. byhope to be inhuman september, with a readout by late september, with the hopes of producing a billion vaccines by the early part of next year. we are simultaneously ramping up manufacturing capabilities across the globe. czar very much on track to what you heard a couple of weeks ago. it's understanding, vaccines take years. what makes this different? joseph: what we are able to do is rely on a platform that we have used in a number of other trial

everyone's conception of what it is different and his whole point and many others, ray dalio on your program, called it the new future, all kinds of ways, pivot, whatever you want to do, what is america 2.0. we're beyond 2.0 for a long time now, but it's a good metaphor. what is it for mark it's focused on a.i., automation, robotics, less focus on college i think he talked about that a little bit me it's more focused on workers' rights, more focused on the idea of around privacy. it's focused around all kinds of things i wanted to get a discussion on what that means and what tech could do to facilitate that going forward. >> i think the worker piece is key and it's something we're going to be talking about later in the show as well, which is this idea of the definition of an essential worker and the fact that you do have a lot of gig economy workers, for example, folks that are on the front lines in responding to this pandemic and helping others in society right now, who may be nef would have expected to be in that position and haven't necessarily been compensated at least until now

i am not in ray dalio's camp yet.ed a few more years and a few billion dollars for that. [laughter] there's a few reasons for bearishness on the dollar. first of all, at the beginning of the year, the market and dissipated rate cut by the fed. they have cut 150 basis points. you see the fed engaging in a large qe program, $500 billion in treasuries and open-ended qe for the credit markets. and finally on top of all that, agreements,fx swap for the first time ever with emerging-market central banks. what that's doing and will continue to do is reduce dollar demand in the stock market. so when we see recovery, which i anticipate in the second half of the year, probably from june and july onward, what we're likely to see is the dollar used not so much as a funding currency, but certainly the safe haven of -- haven allure of the dollar and it will be a carbon copy of what we have seen, short the dollar and buy carry. matt: you think gold will continue to rise. is that in the same time window? peter: gold is more of a secu

ray dalio calls cash trash, and howard marks says it is time to play offense.berg daybreak: americas" on this wednesday, april 8. i'm alix steel. we are just moving along, kind of neutral. really going nowhere. volatility, volume really not picking up either. we saw a potential hurt covering rally that is now petering out. the cable rate flipping entered -- flipping into positive territory, t e

firms run by ray dalio were among those suffering their worst ever losses this month. out of four hedge funds losing money. some funds down up to 40% according to per limitary data. -- according to preliminary data. global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. i am viviana hurtado. this is bloomberg. francine. francine: thank you so much. onto l'oreal. this is one of the most fascinating countries -- companies. the pandemic swept across the globe. closed many department stores. this is what we are seeing in terms of the figures. this is what we have seen. the impact closed department stores, hair salons. sales decline around 5% after record number. the consumer giant is seeking a less severe slump in sales. fashion focused luxury companies like burberry have been slightly more resilient and it sells more products that are available in the supermarkets and drugstores which mostly remain open. joining us is the chief executive, jean-paul agon. mr. agon, thank you so much for j

. >>> welcome back famed investor ray dalio says there are better things to hold on to than cash.an ask me anything session, he said cash is trash relative to those who will retain in periods like gold and stocks there is a, quote/unquote short kweez on the dollar as most people are using it for savings and transactions >> we've seen an improvement we were down about 150 points. now we are implied open down 100 points, s&p implier lower by 16 and nasdaq lower by 38 if these gains hold our own jim cramer said this last night on mad money. >> no matter how much money the government pumps into the economy, without treatment or vaccine, the best you can hope for is a u-shaped recovery i'm expecting the stock market to pull back again that's when you put your money to work. >> joining me now, mark tepper we've become very familiar with the letters l, u and v what is your thought there is jim right an l, u or a v >> i think it is more like a u it's not going to happen overnight. i've heard people talking about the economy snapping back in four to eight weeks that's probably not realisti

dalio coming up, ray thinks there are better assets to holla bend cash. rates low and respond to the coronavirus pandemic. that is coming up. this is bloomberg. ♪ manus: particularly those that will increase in value during reflationary periods. us.guest joins you do not believe in all the conditions for a sustained equity market are in place yet. turn to howard. he is talking about credit and he said cautious positioning has served its purpose. waiting for a market bottom is irrational. between you and howard, what do you need to see? >> in order to have an improved sentiment, we will need to see two things. first that the measures regarding the epidemic are know,g well, so as, you today is today that in wuhan, they are starting to reopen, so we need to monitor quite closely what is happening in asia to make sure there is not a second there and wemic also need to see a continuation of improvement in the curves of the epidemic in europe and the united states. the second thing that we need is data, that the economic and more importantly, the indicators, ar

ray dalio says cash is trash. that while it doesn't move around in value as much as other assets, there is a costly negative return to it. cash is trash relative to other alternatives, particularly for those who will change their value during reflationary periods. .ith us now is mark mccormick do you agree? mark: yes, we are seeing extraordinary investment on the fiscal side. the alphabet soup of all of the things we see from the fed come of the ecb, and i'll of the other central banks to pump liquidity and cash into the system, i think we need about the market response to these things, we are in a world we have never really seen before in terms of the magnitude of the fiscal and monetary support. if you think about how that will play overtime, look at what you are getting from gold, that is a significant push away from a world looking for alternative forms of cash. that's fair, but still within the g10 space, is there anything that is going to supplant the dollar at this point? mark: not immediately. one of the t

i want to point out, ray dalio said a moment to on bloomberg television you would be crazy to own bonds. go back and have a look at that interview if you want to hear more. the vix a little more elevated once again today. guy: let's get some more insight into what is happening on these markets. we are joined on the phone by graham secker, morgan stanley equities strategist. equity markets a little whippy, as vonnie said. how do you see the risk-reward right now? graham: good afternoon. from a european standpoint, we don't really like the risk-reward here. we thought it was a lot better three or four weeks ago. valuations back then were really low. juste got down to a pe north of 10 times. is near 14 times. i am trying to ascertain the profile for european earnings over the next couple of years. they are going to be down a lot this year, up quite a bit next year and a growth perspective, but overall, earnings are going to be down by a fair amount. i am just struggling to get any upside unless i shoot some very punchy valuation assumptions. i think markets have probably moved a bit too fa

ray dalio told me yesterday that this is much worse than the 2008 financial crisis.hat kinds of base case assumptions are you making at this point for the recession and the recovery? james: i'm not sure i agree with that. the economic impact, the gdp decline is obviously much worse, but it is obviously so specific, and it is built around the virus. what kind of world will we have when we have immunity from it, when we have the right testing? there's so many unknowns now, whereas back in 2008, it was a fundamental collapse of the whole financial system. had the system not been rescued, who knows what long-term damage might have been done to the economy? tragicse are both truly situations. from our perspective, and running a company, there's a few things you've got to focus on. we've got millions of clients trading trillions of dollars all over the world. our plan has to work. we have to be able to facilitate clients doing that so they can manage their businesses. they have to have the ability to manage their own liquidity and funding and capital needs, and we play a c

ray dalio told me yesterday that the is much worse than the 2008 financial crisis. what kind of basecase functions are you making at this point for the recession and the recovery? james: i'm not sure i agree with that. , the gdpmic impact decline is obviously much worse, but it is so specific and it is built around the virus. what sort of world will we have when we have immunity from it, when we have the right testing? there's so many unknowns now whereas back into thousand eight, it was a collapse of the whole financial system. had the system not been rescued, who knows what long-term damage, multi-decade might have been to the economies? truly tragice both situations. from our perspective and running a company, there's a few things you've got to focus on. number one, we've got millions of clients trading trillions of dollars around the world. our plant has to work. we have to be able to facilitate clients doing that so that they can manage their businesses. they have to have the ability to manage their own liquidity and funding and capital needs, and we play a cri

there are philanthropists, ray dalio, jeff bezos, others who are trying to fill that gap and get theevices and connectivity out there. in the end, the low income students will be hurt the most by these school closures >> in terms of being an investor, obviously you're a well-known investor, not that you're probably spending that much time thinking about that, but have you changed your investment strategy at all since this took place? >> no, i haven't put much thought into that. and i'm able to delegate a lot of that. there are whole industries that are going to have reduced demand even after supply comes back and, you know, capital spending, cars, houses, all those things, it's hard to think that the general animal spirits will be anywhere near what they were before this got started. but i haven't mapped that into, you know, what it means for the market >> what does your day look like these days >> i'm on a lot of video calls you know, we're talking about, okay, how do you make 7 billion doses? how do you get these trials -- there's over 20 compounds that look promising as therapeuti

out rayant to point dalio says cash is trash on a reddit, this is not something we have heard, he islients. would you be remiss holding dollars right now? it does not look like we will have massive inflation around the corner, does it? karen: not imminently. it is an interesting question as we look slightly beyond the next six months. going, it ison is important in times of crisis like this to not get bogged down in the next month or two, but to step back and see what interesting things develop over the medium term. i think reemergence of some degree of inflation could be one of the consequences. not just because central banks are printing money, we have been there in 2008, we know balance sheet expansions do not necessarily deliver inflation. it is an fiscal policy this time around. austerity is not coming back regardless of what debt levels we reach in this crisis. as we come out of this, and the central banks who opened the monetary spigots alongside authorities, if those combined authorities are reluctant to turn it off, or find it of thatt to remove some stimulus, the conversati

ray dalio said there's a possibility that the economy could see a depression.hat? and what do you make of the efforts so far made by the fed? has it done enough, or has it gone too far? michael: it definitely has not gone too far. i don't see us going into a depression. the most optimistic message i can give you is hundreds or thousands of bioscience companies are working on a solution here. dozens or maybe even 100 companies are working on a testing solution. advanced so much, forget,s we do not something we have discussed constantly, that every human life is rushes, and if you save on life, you save the world. on an economic standpoint, public health and medical research has been accountable for more than 50% of all economic growth in the last two centuries. expectancyg of life in many parts of the world, and not only increasing life expectancy, but the quality of life. i think whether it was the sikorsky, with alan the ceo of j&j, the world's largest health company, or the head of the nih, or david baltimore who won a nobel prize on his work with viruses, or

ray dalio told me yesterday that this is much worse than the 2008 financial crisis.nds of base case assumptions are you making at for the recession and the recovery? james: you know, i am trying to think. impact of the gdp decline is much worse, but it is so specific, and it is built around the virus. what kind of world will we have when we have immunity from it, when we have the right testing? there's so many unknowns now. back in 2008, it was a fundamental collapse of the whole financial system, and had it not been for, you know, had the system not been rescued, who knows what long-term damage multi-decade might have been to the economy? are truly tragic situations. from our perspective and running a company, there's a few things you have to focus on. number one, we have millions of clients trading trillions of dollars all over the world. our plant has to work. we have to be able to facilitate doing that so that they can manage their businesses. they have to have the ability to manage their own liquidity and funding and capital needs, and we play a critical role in

we seen some of the industry, ray dalio, suffer some of their worst monthly losses they've ever seen.cross different strategies. when you look at what the hedge friend industry -- the hedge fund industry looks like coming out of this crisis, who will win and who will lose? creates a think this new generation of winners and losers, and this is a really different scenario than 10 years ago. during the global financial crisis, we had consecutive quarters into thousand eight and 2009 where we saw 10% of industry assets get redeemed two quarters in a row, and those were massive moves. this time, while there are certain funds that may have had a stumble in q1, financial service isn't the trigger of this crisis. the hedge industry overall is really reasserting its value by underperforming broader markets, and we are on stronger footing, so there's no indication at this point that we will be seeing the same indiscriminate redemptions, at least for this quarter in the near term. with any industry, there are going to be certain winners and losers that will come out of this. from a structural pe

ray dalio, the founder at brid bridgewater, believes that a depression is likely. i'm of the opinion, my team is of the opinion that that is not likely. we believe in a u-shaped recovery, and that depends on a couple of outcomes. the sooner we develop a vaccine, the sooner we develop mass testing and tracing, the sooner the economy is going to open up. we are likely to have a second wave, and a key is going to be how quickly we are on top of that. the health care system will be much better prepared the second time around to manage the caseload and how quickly we identify carriers and isolate them and minimize the economic disruption of a second wave. admittedly, whether the u is a short or a long trough, we think that people are adaptable, they're resilient. we will find new ways of doing business together, we will find new ways of enjoying our lives, and over the long-term, we will reach new highs, and we will find new ways to create prosperity. with that, i'll pause and turn it over to the board for questions. >> if there's no board questions, we'll move onto the

coming up, we have a big interview for a cochairman, ray dalio, who joins bloomberg exclusively at 100 p.m. if you are watching in hong kong, 10:00 a.m. wednesday in new york. this is bloomberg. ♪ >> as we heard earlier, president trump has suspended u.s. funding for the world health organization, saying it failed in its duty and was slow to report details of the coronavirus. he has also called it china centric. we have the power project director and senior advisor for asia. bonnie, how much does this latest move from the trump administration kind of play into the hands of beijing? we saw earlier today president trump saying he has a problem with the who, a problem with the wto, does not know which is worse, but these global institutions are very much his bugbear, and within his playbook. does that really play into beijing's ambition is take more of a global role, particularly as it reshapes and smooths over the way that it has handled the pandemic? i think beijing has seen opportunities that it has tried to take advantage of. that has been presented by the trump administration's walk

ray dalio, founder of basically the world's largest hedge fund, says don't go into cash.is going to weaken because of all the money printing that's going on. so you don't want to be in cash. would you agree with him? >> i would agree. at some point in time when you look at the $2 trillion coming from the phase one through phase two, three from the government right now, from the fiscal side as well as from the monetary side, the fed being the lender of last resort, providing unprecedented levels of cash to the markets, i mean, now is not a time even steven mnuchin said this, to worry about debt and deficit, but at some point, that's what ray is referring to, that this will create inflation. we have been saying that for years after 2008, it just hasn't manifested as you know, jay powell addressed this morning that we had a deflationary problem, not an inflationary problem. but i can't imagine after all of these trillions that there would not be an inflationary situation in the future. ashley: i'm sorry it's so short. heather zumarraga, great to hear from you regardless. we

they give blackrock special access they give ray dalio special access when you realize that there arenesses that have been trying to get their profits out of china since q4 2016 and they haven't been able to get their money out because china won't let the dollars out. what do they do? they hire lobbyists in the u.s. who know xi jinping and the rest of the people and they can't get their money out. i worry that all of the money that's flying into china through the msci and through institutional invest , i just worry that it won't be able to come out >> hey, kyle, thanks for throwing t joe kyle, question for you, which is you were talking about the location you're in with the social distancing in place and the reopen, does it work i mean, does the model work? >> you know, i think that -- i think you will see it. americans aren't used to being, let's say, sequestered in their homes. i think we all have some sort of cabin fever going on after being locked up for a couple of months i think we've all enjoyed being with our families a little bit more it's been found time for those of us that