tv Bloomberg Best Bloomberg April 22, 2017 12:00pm-1:01pm EDT
♪ nejra: coming up on "bloomberg best." the stories that shaped the week in business around the world. a snap election looms in the uk and the results of a referendum reverberate in turkey. >> the biggest change to the constitution since the formation of the republic 93 years ago. nejra: investors wondering what is next for the central banks. our interviews this week offers some insight. >> i think the inflation mandate we we'll have to watch closely. >> the strategy of going gradual is one i have supported. >> the basic trend is towards 2% in a gradual manner. nejra: danger lurking ahead for markets. >> we could adjust downward
5% or 10% from here. nejra: big banks with their earnings reports. >> there are so many analysts asking the same question, what happened in fic? nejra: it is straight ahead on "bloomberg best." ♪ nejra: hello and welcome. this is "bloomberg best." your weekly review of the most important business news, analysis, and interviews from bloomberg television around the world. let's start with a day by day look at the top headlines. the week began with promising economic data from china. ♪ >> china's economy accelerating for a second straight quarter. we saw investment, retail sales, factory output all coming in above estimates for march. >> another strong set of strong numbers out of beijing. >> it certainly looks that way.
the 6.9% number for the first quarter beating estimates is the biggest uptick in china since the fourth quarter of 2015. the economists we have been speaking to saying this has been supported by investments, also property sales. the real estate sector is still playing a strong role here. of course, we have the other numbers, the retail sales numbers beat estimates and points to consumer confidence . it also suggests that concerns that the auto section would drag down that number is not coming into play with as much force as some had feared. >> the turkish president has claimed a victory in the referendum over the weekend, a sweeping overhaul of the government since its founding. voters narrowly backing the plans to give him wide-ranging powers and he has warned opponents to expect radical change. >> this secures him 18 changes to the constitution.
as you said, this is the biggest change to the constitution since the formation of the republic 93 years ago. it will include things like letting him lead the akp again and to appoint ministers, dismiss judges, and the opportunity to stay in power 2020's way into the late . so, the question becomes, what reforms can the administration enact going forward? plenty of opportunity, but little clarity in terms of the economic policy of the government. >> it is sparking a relief rally in turkey as it ends political uncertainty. >> now that visibility has , and the debate over the government system has it is back to the regular agenda. that will include structural reforms. >> will markets consider this a good thing? >> they definitely think it is a good thing. we have had an extended period
of political instability in turkey and the lira has underperformed dramatically, as most emerging assets have done very well. >> we think the incentives are for him to promote a period of economic stability, to continue to get the economy to grow. ♪ >> the u.k. prime minister theresa may calling for a snap election to be held on june 8, to potentially get extra backing for brexit. the announcement comes less than one month after she triggered the formal start of the exit process. why today? why now? >> first of all, there is a summit happening between the eu 27 and the u.k. on june 22. a lot of people are saying, look, theresa may is doing this to strengthen her hand going into the brexit negotiations. she is doing fairly well. her party is doing well in terms of polls. the latest poll putting her 20
points ahead of the opposition labor party, but her reasoning for doing it now was she is getting opposition to some of her brexit plans among lawmakers. so, what she wants is really to have a strong mandate to go ahead with her plans for brexit. >> shares of bank of america are lower, but goldman sachs is down 4% all session after reporting earnings this morning. gordon -- goldman showed a rare shortfall in long trading revenue in contrast with reports from its three bigger competitors. bank of america saying they are trading in a decline. many expected goldman sachs to do better. why didn't it? >> there are so many analysts asking the same question. ic?t happened in f really what we got is what did not happen, commodities were not strong, currencies were not strong could we got that mortgages did well, but we do not understand exactly other than these few pieces what went
badly. that contrasted with bank of america. they said these things are all the things doing well, mortgages, special situations, again trying to figure out if bank of america did well on that, why didn't goldman? ♪ >> morgan stanley did much better than predicted in the first quarter with fixed income trading beating even goldman sachs. this is a really good report. what are we missing? >> it is a good report. as far as fixed income goes, coming in better than goleman. that is only about the third time it has happened on a quarterly basis over the last decade. equities trading, which is more important for morgan stanley, we well in that business. the other thing important for morgan stanley is their wealth margins. that has been a key goal for them, coming in better than expected this quarter. >> morgan stanley reporting and an almost doubling percent
increase in revenues year-over-year. you have to remember that for morgan stanley, the fixed income has been the albatross around goldman's neck. now they look like they may have turned it around. ♪ >> we will go to the white house where the president is issuing a memorandum on the investigation of steel imports. pres. trump: for decades americans have lost our jobs in our factories to unfair foreign trade. one steel mill after another has been abandoned and shut down and closed. we are going to reverse that. >> you have been just watching a playback of the president signing a memorandum authorizing the government to expedite an investigation into whether steel imports are hindering national security. what does this have to do with dumping? this investigation into national security? >> we heard it right there, the president saying this has nothing to do with china, but the chinese clearly think this is a signal to them in terms of the ongoing trade negotiations that are underway.
he is giving warning to all countries involved in the steel industry and saying we are going to investigate you. we are going to take a look at you, and also gives political clout to many of the top executives from steel companies who were just inside the white house moments ago, talking with the president, and it them a -- and it gives them a moment so to speak as they go back out to their companies. ♪ >> president trump signs one executive order and two memos dealing with financial revelation and taxes at the treasury department today. he directed treasury secretary steve mnuchin to look at the dodd-frank act and report back on ways to improve both documents. >> earlier this morning, steven mnuchin talking to reporters, walking us through what is exactly going to happen. he will be signing executive orders instructing lawmakers and the federal government to review dodd-frank. he is also going to pay particular interest to orderly liquidation authority.
that deals with two big to fail, fail, whetherg to large financial institutions are going to pose any systemic risk to the larger economy as a whole. so, look, this becomes part of partisan fight. republicans argue dodd-frank has codified too big to fail. democrats argue that it prevents too big to fail. i asked treasury secretary steven mnuchin just how regulatory reform fit into this administration's plans to roll back dodd-frank. this is what he had to say. >> let me make it absolutely clear. the president is absolutely committed to making sure that taxpayers are not at risk for government bailouts of entities that are too big to fail. ♪ nejra: still ahead on "bloomberg best," larry fink has words of warning for the markets and bill gates hopes donald trump will be a pragmatist when it comes to health care spending. plus, we have plenty of earnings reports to review.
this is bloomberg last. let's continue our global tour of the week's top business stories in silicon valley. bloomberg has learned apple is working on a major redesign of its most important product. >> apple is planning its most extensive iphone lineup. in addition to the current models, apple is said to be testing a completely revamped iphone for the 10th anniversary of the device. a bunch ofll be
iphone stuff. one will be an overhaul. bigger displays, better displays and more defense cameras for this 10th anniversary upgrade. a critical time. it is looking over its shoulder at samsung. >> samsung is coming out with their phone. it has been recognized as a hit phone. .t has a bunch of new features apple will be going up against this new phone. said to bet trump nominating and -- to the fed's top regulatory -- senior treasury official in the bush administration, he is currently managing director of the private equity firms. >> the nomination of the vice-chairman of the fed in charge of regulation is the most important nomination in the banking industry by the trump administration. thathe short checklist is
summit is going to add additional regulation. is this going to increase the opaque nature? i think the answer is no. i think it reflects the pendulum shifting from tough regulation >>more neutral regulation president trump is taking action on the 81 visa program. he has signed an executive order to review programs to favor more skilled and highly paid applicants. >> the whole idea is to shift those visas away from lower tolled less well-paid jobs jobs that are really high school and that you couldn't find in an american worker. >> what is interesting, it seems the white house is asking for help from certain agencies, for their ideas on how to make this more targeted. >> yes, this executive order
does not order them to do anything. all it does is start the process of what any large organization would do, which is to say, we have this goal, what are some good ideas on how to achieve it? this is something that will take probably months, probably not until next year until you see an impact on this. ♪ >> the international monetary fund says global recovery is gaining momentum. the imf raising their gdp forecast for this year to 3.5% and predict a pickup for 2018. the fund left to their u.s. forecast unchanged at 2.3% and 2.5% respectively. it seems like the imf's take on the u.s. is wait and see, and that basically means it is wait and to see for everybody else as well. >> but at a good level. they are still forecasting the u.s. to be firmly in the 2% to 2.5% annual growth range. one of the real takeaways is not so much the warning about
protectionism, because they have to do that, it is more the optimistic picture about the world. japan upgraded, china upgraded, and shock, horror, the post-brexit u.k. upgraded as well. >> verizon is trading higher in premarket. this came after the ceo told bloomberg that he would take a phone call from a content provider for a possible merger, and that is to reset the course. this is an odd way to go about matchmaking. if anybody wants to call me, you know my number. >> i think verizon are looking at their stock price and other media companies, at&t, time warner are doing really well, and i think verizon realizes that maybe shareholders want to see them do something. some of the speculation out there around verizon, like charter a couple months ago, shareholders did not like that but maybe comcast or disney or cbs, maybe he is throwing it out there to see how investors receive it. >> fox news has announced the departure of bill o'reilly,
bringing an end to the host's two-decade at the network. what it mean? >> in itself, the show is an important show, the highest rated show, generates the most revenue, but only 1% of the company's revenue stream, so not that big. when you step back and take a look at the cable network business for the 21st century fox company, the cable network business, which there are many, are about 80% of the operating income for the entire company. so now you take a step back and look at fox news. they have lost a lot of primetime talent over the last six months, not to mention roger ailes. now bill o'reilly.
it is an odd time for fox because we are coming into the upfront selling season where the tv networks go to the advertisers in may and to say, here is what we are going to give you next season. if you are an advertiser you can, maybe i will step back to see how the ratings play out on the fox network. >> japan ending the first quarter on a pretty strong note, right? we saw the export and import numbers both expectations in march. was it largely expected that these numbers would come in quite strong? >> betty, i think we got the numbers would look good, but not this good. the exports were supported by shipments of auto parts and a steel and one of the big numbers is the 16% growth in exports to china, their biggest trading partner, so it is all a bullish picture. there are some questions about whether it is sustainable as we get into the second half of the year. those china numbers probably distorted by china's lunar new year effect and other doubts on the horizon, but it is a bullish set of data and will support the
stock market this morning for sure. >> oil on the rebound today off of the highs of the session after saudi arabia signals an extension to opec-let's apply cuts. here is what the oil minister said, although there is a high level of commitment, we have not reached our goal, which is to reach a five-year average. there is an initial agreement we could be obligated to extend to get our target, but we need to communicate with all of the countries could we talked, but we did not talk to everybody. how much of jawboning will we see like this over the next month? >> quite a lot. in the market, it will be jittery until we get to the final deal and we get to see the numbers, the supervision
mechanisms put in place, we need to see that. i'm sure it will be -- as it will create a little bit of jittery, so let's not forget the will be if ends swinging markets. >> virtu agreed to by its rival kcg for about $20 a share in cash. stocks trading $14. surging 11% to about $19 on news of the deal. and shares jumping for virtu. let's talk about the trend in the marketplace that make this the right time to do this. >> more efficiency in the market with less volatility, so putting pressure on margins for every participant. pressure on the margins. and kgb has a wonderful consumer franchise. him a very efficient market structure, and combining those we think we look at the best of both. >> samsung's newest smartphone hitting south korea and the u.s. /';on friday and the company says preorders for the galaxy s8
and plus have surpassed one million units, setting a new company record. do you think the success will be big enough so that people forget about exploding phones from samsung? >> i think they will. and ultimately, they will not make the same mistake twice. one of the big features is this phone will be 21% bigger and i think that will be a selling point. consumers have short memories. if you get a phone 21% bigger the same price as before, i think they will quickly gravitate toward that. ♪
in the u.s. and uncertainty around the trump administration pose a risk to markets. larry: earnings season is probably the most important issue for the markets today. i would -- the marketplace had higher expectations on quick actions out of our government related to tax reform, infrastructure, and then deregulation, so those are the three things the marketplace looks for, and that will take obviously more time. and so, if we do not have earnings validating these higher pe's, and we could adjust downward 5%-10% from here, and if the administration does succeed in these items, then the market will reach asserted itself going higher. >> you make it seem as though the u.s. stocks have nowhere to go but down, unless --
larry:, no, i didn't -- >> unless it is a validating picture. larry: it has to be validated. if it is not validated, it goes negative. i do not look at that differently at any other time. the pe's are really high on a relative basis, and u.s. equities are higher than europe and asia, so it has to be validated one way or another. we have had, since the third quarter, synchronized global growth. the slowest economy in the world, or in the g7 is the u.s. so, you are seeing china growing much faster. remember a year ago at this time, we were worried that china were going into recession. they are growing close to 7% right now. we were worried about japan. they will have positive growth
this year. spain growing around 3%. france growing above 1%. and you have canada. here we are worried about north america, canada is growing at over 2.5%. the market has been validated by a synchronized global growth, it was not just the election era. more importantly now, for the market to have another leg up, we need to see validation of these policies from the trump administration, and we need to see validation from the earnings. my worry is that it will be a harder picture. we sense that there is more uncertainty, and because there is uncertainty related to tax reform and the timing of deregulation, we see more and more businesses holding back. you are starting to see it in different numbers, so i would
say that there is warning signs here that are getting darker, because we have seen pullback. you are seeing that in car sales. you see it, you are actually starting to see a slowdown now in m&a. things now, people are taking a pause. valuations are high. that is slowing down m&a. uncertainty of tax reform is going down. >> also you have 2.2% on the 10 year. larry: that is one thing i have been calling. >> how low do we go on the 10 year yield? larry: i believe there is a 51% probability that the 10 year treasury could go below 2%. nejra: coming up on "bloomberg best," more of the week's conversations with global leaders in business, politics and policy. canadian prime minister justin trudeau, japan boj governor kuroda, and bill gates, who intends to bring his message on health care directly to donald trump. >> it means talking to him and
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>> i don't think that people who are promoting that border tax within the congress have a fully thought through the consequences that might -- >> do think that this is an area where donald trump may have overreached? >> i think, i think that the issue facing president trump is that he made a promise to do things that were good for the middle class and he was going to help people who felt they were not part of the economic success of their country, and killing jobs because of thickening borders is not something that mr. trump is particularly interested in.
host: that was the canadian prime minister in conversation with bloomberg's john micklethwait. you will see more of that interview on bloomberg television in coming weeks. another special guest on bloomberg television this week was microsoft cofounder gates, who sat down for an exclusive interview with manus cranny. he spoke about the urgent need to maintain spending on health care and whether it will happen under president trump. >> i am a strong proponent that innovation in health, even getting the health systems around the world to be decent enough so that as pandemics develop you see them early, you can catch them before they get completely out of control. and so if we underspend on health, we are going to have a flu epidemic, or an epidemic that will affect us economically and even for military activity, it will be expensive.
so the balance between soft power and hard power, particularly with health crises, if there is anything that could horrifically go and kill people, it would be an epidemic, so you do not want to get out of balance. >> you have been vocal and the foundation has been vocal about being troubled in the cuts with health funding. when i look at donald trump on north korea and china, what about the threat to cuts being scaled back? >> i think there is a good chance that the administrative proposals, the executive proposal, will not end up being the exact budget. there are things like the hiv life-saving work that gets done that has got a very strong backing in the congress. budgets go through congress and they require enough votes in the senate that they can't just be
completely one-sided on an issue like this. so i don't think large cuts will take place, although when it was first put forth, we had to speak up and get defense communities to say, hey, they care about these things. >> you have had a couple meetings with him, is he a president that you folks are confident with? is he a president, and you have met many of them, is he a president you can do business with? >> certainly, he is the current president, he is pragmatic on a a lot of things. it means giving him background he may not have had through his past work, it is probably as important with him as with anyone. ♪
nejra: u.s. inflation expectations took a hit and investors are scaling back their forecast that the federal reserve will raise interest rates as soon as june. officials shared their thoughts on monetary policy on bloomberg television, beginning with the kansas city fed president esther george. >> the fed seems to be divided into camp that say we can do one more, a camp that says we can do to more, and some even that's a there could be three more -- where are you pitching your tent? >> i am looking at normalization and cannot pin down the number today. you know for the long one where you are going and you continue to move forward watching how the economy reacts. i think the strategy of going gradual has been one i have supported. whether that means we will get
four moves or no more at all will be a function of how we see the outlook unfold. that is what we do at every meeting. >> you suggested if things proceed as you expect, you would be in favor of normalizing the balance sheet by the end of the year. a number of decisions must be made on how to do that. one think that people want to know, when would we get that announcement of how the fed is going to handle the balance sheet? >> i don't know the date of that. you saw in the minutes that we began that discussion with the staff, helping us understand, and discussions lead to more questions, so i think we want to be thoughtful and continue to talk about what we think the implications are, what the timing would be, and all of that happened in the context of how we see the economy unfolding. we have not made a decision on when, but i think as we continue this discussion, you will see the minutes reflecting this. >> later rather than sooner? >> my preference would be that we nail down what we think about the relationship between
short-term interest rates and that balance sheet, that we have to make decisions about whether that will be just a natural runoff, or whether that will be some smoothing there. so i don't know how long it will take to figure out, but i hope we can sort that out and make a decision, tell the public what we plan to do, and get on with it by the end of the year. >> the fed this year pivoted toward a faster pace of moves. is there anything that tells you that that pivot may have stopped or slowed? >> i still think that the, the three, the median of three rate increases for this year, we have already done one, is still a good baseline. if the economy develops more slowly, then we can do less than that. if the economy is a little
stronger, we can do more than that. but i still think we are making good progress toward a employment. there is still some labor slack, but we are approaching full employment. the trickier issue is inflation. the work we are doing in dallas suggests that core inflation continues to slowly and gradually move up. but i think excess capacity globally, particularly in china, and possibly growing because they keep investing in the excess capacity in china, and second, technology and technology enable disruption, which is impacting pricing power and increasingly replacing people with technology, those are having downward pressure
impacts on inflation, so i think the inflation mandate we will have to watch a little more closely. but i still think having said that, three is a good baseline. but patience means to me, when i say we should be gradual and patient, i mean we have the ability and flexibility to wait and see how the economy unfolds, turn over some more cards, and i would say that is appropriate, that we exercise that patience. nejra: one of the world's most prominent central bankers spoke with bloomberg this week. francine lacqua set down with governor kuroda for the bank of japan in new york. >> if the yen goes had, does it hurt the inflation forecast? >> the inflation forecast is based on the assumption that rates would not move much upward or downward. so if yen depreciates, then of course inflation rate could rise. and if yen appreciates, then the inflation rate could decline. that is true. but, i can say that our inflation forecast is based on
continuous improvement in the labor market, continuous improvement in output cap, which is certain, because 1.5% growth, now the economy is doing well above potential growth rate. so the labor market will continue to tighten and prices will rise, so i agree the inflation rate in the short run could rise, but basically we see that the inflation rate would gradually go up, reflecting improved output cap. >> you have done more than any other central bank governor to get rid of inflation. when we spoke six months ago. you have gone outside the toolbox with everything you can. are you still confident you can achieve 2%?
>> yes. >> there is no doubt? even if the yen goes higher? >> as i said, our focus is in the sense that we would reach 2% target around fiscal 2018, uh, it is based on the assumption that the exchange rate would not move and so and so forth. so that exchange rate appreciates, then of course, timing could be -- and if exchange rates depreciate, the timing could be earlier than otherwise, but the basic trend is toward 2% in a gradual manner, reflecting
nejra: you are watching "bloomberg best." earnings season is in full swing. let's look back at some of the companies reporting results this week, starting with a u.s. airline that needed some good news. >> united continental trading higher after hours after beating estimates in the first quarter, this comes as the airline deals with the outcry for the forceful removal of a passenger last week. does this report that we got from united, which is pre-this incident, confirm that airlines are doing pretty good? >> we are still at generational highs further profitability, not as good as last year, the fuel costs a bit higher, we knew it would be higher for most of the airlines, but they are more profitable than they have been
and investors are looking at them because of that. >> how much does brand really matter? >> with airlines, people usually go for the cheapest fare possible, so in the near term i think it will affect some bookings, but long-term passengers really go for the cheapest fare. wall street continues to binge on netflix shares are poised to open at a record with investors cheering. >> it is a mixed bag in terms of metric people look at, which is subscriber growth. they missed with the numbers in the first quarter, typically that is the death knell for the stock, but the guidance they
gave in the second quarter was better than expected, so offsetting each other. so, net-net, the bulls can step back and say that the consumer growth story is still intact. >> they said in the investor letter, page five, right smack dab in the middle of what they expected and they are burning cash for many years. i do not get what people are playing for, who cares if they go from 100 million to 200 million if they cannot make money? >> first quarter results, with revenue falling. down 2% to $18.2 billion and just under expectations. meanwhile, gross margins also trailed analyst predictions. we have seen revenue falling with the growth profit margin falling as well, so any rays of light for ibm? >> the few things i would point out is that the pretax margin actually went up. that is due to a severe cutting of sg and a. saving on expenses. there is a lot of headcount reduction leading to profit expansion.
if you look at both the cloud numbers as well as some of the other areas, you are seeing revenue growth over there. the legacy business are the ones declining, and it is not enough to offset, the cloud growth is not enough to offset the declines in the legacy business and it will take time before it lot sides where you see the cloud business and analytics taking over the decline in the legacy businesses. >> akzo is to explore the sale of a chemicals business within 12 months, as it looks to fend off the takeover approach from ppg energy. at the same time, the largest paint maker in europe returning to its shareholders in this year. they are forecasting their third straight year of record profit. >> do think this new plan unveiled today is going to satisfy shareholders, that they
will no longer be calling for you to go to ppg and accept their offer? >> these are two companies that have distinct differences in the way that they work. the specialty chemical business is an asset intensive and relatively people like business, where the paint and coding business is asset light. these two dynamics can actually drive growth and operational excellence more efficiently, and therefore breaking these two into different focused companies has a value increasing affect, as you have already seen in some of the effects on the share climbs. >> online brokerage td ameritrade maintaining its earnings forecast for the year, despite cutting their trading commission. scottrade purchase scheduled to close as expected by the end of the year. talk about what parts of the integration has been completed and will be an effect for october 1? >> the teams are working well together. it is this awkward thing because we are in this period where we
are waiting for regulatory approval, so we are competing and we have a plan to be one firm. as we get closer to the date, they are getting more detailed in their programming. we are figuring out which branches to keep of both locations, systems decisions, product decisions. it is quite detailed at this stage. >> qualcomm reporting that they beat expectations. they reported earnings of $1.34 a share on revenue of $5.9 billion. even amid the ongoing battle with apple, that was discussed in the earnings report, and talking about networking and internet of things. but there is a clear apple effect here, $1 billion of payments? >> none of the near-term results matter to be honest. it is the ongoing effective apple that is going to have an impact on qualcomm over the next four quarters and over the next two years, and this litigation is going to take two years, mind you, the bigger issue is not apple.
if apple was to win, what does it do to the qualcomm royalty model? that is the question. if apple is to get a better deal, when that apply to all of its assets and customers? that is a bigger issue. and if apple wins outright in the court, saying the value of qualcomm's intellectual property is to be based on the value of the chip, and not the value of the handset as qualcomm contends, then the royalty model is broken wide open. >> we have had beating results from two of the biggest consumer companies today, unilever with underlying sales up 2.9% in the first quarter, and nestle reporting a 2.3% increase in sales. let's start with with nestle. new chief executive, mark schneider. we have a pickup in pricing.
does the revenue signal an uptick in what many call the sluggish food and beverage market? >> it may be the start, because i suppose currencies are stabilizing of little bit in emerging markets, and raw material prices have gone up because of volatile currency moves. so you have to get that back-end pricing, although the margin structure has been blown apart. with the currencies, it is probably helping. >> when it comes the unilever, is that enough with this news today to deter a future bid from kraft heinz? >> the results today shows why they are putting up for sale or restructuring the spreads business. it took two basis points off the growth. >> verizon is one of the biggest declines on the dow, down more than 9% year to date after the nation's largest wireless carrier said it shed 307,000 customers in the first quarter, losing subscribers is just
something that you cannot get over. >> yes, that is the headline, whether or not they have met expectations tell us about the company, verizon subscribers, it is the name of the game. get them and keep them and keep charging them a lot of money. the stock is based on that. the ability to pay dividends is based on that. so this big drop in subscribers, losing 307,000 subscribers is important in terms of direction and it represents a big change in the industry where verizon is unable to add people and are losing people because they are unable to keep up with industry trends. >> general electric reporting profits that beat estimates for sales growth in jet engines, given a boost after some investors were growing anxious about results. good news, as we say, for the ceo. what was working out for him? >> organic growth better than expected across the board and oil and gas not as bad as it has been. it is turning positive after
four quarters of negative quarters. so topline is better and they are accelerating. >> power and engines really drove it? >> up like 25%, so that was big. and we have anniversaried -- it is actually apples to apples. power is picking up, but even, i think the other surprise was oil and gas was not as bad as it has been. sales were down 9%, and they were down 22%, so that is a good sign. ♪ ♪
economic surprise index on the right. >> and we have not had a lot of companies reporting earnings within the s&p 500, only 31. we know that they did beat earnings and revenue by .5%. >> there are about 30,000 functions on the bloomberg and we always enjoy showing you are favorite on bloomberg television. maybe they will become your favorite. there is another function, quic . it will take you to where you can get fast insight into timely topics. here is a quick take from the week. >> china's president xi jinping has a dream, or you could call it a pet project. he wants to revive the ancient silk road. that means trade on the route via pipelines and highways. the silk road project is
supposed to boost development and deepen economic ties across central asia, but critics see it as a way for china to spread influence further to the west. so here is the situation. the original silk road began as a trade route that stretched from china to as far as europe. silk, spices and porcelain were transported to the west. today, xi wants to use materials from the overproducing factories to improve infrastructure on the route. it comes with the development of ports in asia and highways in pakistan and tajikistan. to help bankroll the dream, the chinese government created a $40 billion silk road fund. they say that countries have signed agreement and others are cooperative on plans such as railroads and nuclear power. they are weighing the economic benefit against a dominant superpower's demands. a deal for a rail project in
thailand fell through because, according to thailand, they were strings attached, mainly china demanding commercial property rights. here is the argument, china says the initiative is a way to boost industrialization in developing nations sandwiched between east and west. economists agree that the initiative has the potential to stimulate global economic growth. but there are also risks, like funds those funds not going where they should in a region with corruption, and longshot developments turning into white elephants. there is also concern about china's assertive military, particularly in asian waters. ♪ nejra: that was just one of the many quick takes you can find on the bloomberg. you can also find them at bloomberg.com, along with all the latest business news and analysis 24 hours a day. that will be all for "bloomberg best" this week. thank you for watching. this is bloomberg.
david: what was it like when you came here? did people make crocodile dundee jokes? james: people would say to me is it true that all australians wrestle crocodiles. david: people throw things at the walls, scream and yell. james: i think if you are the seventh of 12 children, you don't want to be the thrower. david: are you in favor of repealing dodd-frank? james: what will replace it? the world doesn't want the large banks to be unregulated. david: you have been a ceo for seven years. that is pretty long. james: what are you telling me? [laughter] >> would you fix your tie, please? david: well, people wouldn't recognize me if my tie was fixed, but ok. just leave it this way. alright. ♪
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