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tv   Bloomberg Markets Balance of Power  Bloomberg  February 25, 2020 12:00pm-1:01pm EST

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welcome to "balance of power," where the world of politics meets the world of business. on the brief today, we are in hong kong on the spread of the coronavirus. gina martin adams in new york on what the spread of the virus may mean. and in washington, wendy benjaminson on who will be in the spotlight in tonight's presidential debate. let me real -- let me lay out what president trump said in india. president trump: i've spoken to president xi and they are working hard. if you know anything about him, i think he will be in pretty good shape. and have had a rough patch i think right now it looks like they are getting it under control more and more. david: they say it looks like they are getting it under control. does it look like that way from where you stand? >> mike pompeo suggesting that
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if it had not been for the information suppression by china and the first place we would not be in the position we are now. austria, italy with 50,000 people under lockdown. in the spanish island we have people locked down in a hotel. deaths. 15 a big cluster of deaths outside china. also getting reports of an infection in switzerland and do not forget south korea. this is what is going on. it is about containment. people are trying their best. united arab emirates and turkey banning flights to iran. this could have a huge toll when it comes to the global economy. economist saying we will get a shaping of .1% growth this year. then you take a look at something like ubs. the chairman suggesting this quarter we could see the chinese economy shrank. he is talking about a global economy in the same timeframe going from free .5% growth to
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cash from 3.5% growth to .5%. i mentioned what is going on in some of the pond trees. and south korea 937 people infected currently. they have seen their consumer confidence numbers fallen off a cliff. they are down to the lowest in five years. remember the last coronavirus, the respiratory syndrome. there is a lot to play for. going back to italy, the lockdown represents 22% of that country's gdp. that is how much economic activity could be stifled as a result of what is happening there. what can people do? we have economists suggesting we could see 205 basis points of cuts on the seven biggest central banks in the world. would 205 basis points make a difference? people are fearing for their lives. people are frightened. will they use the interest rate cuts for any benefit?
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the jury is out. david: thank you for that comprehensive if sobering report. now let's go to gina martin adams. it is a human tragedy. we never want to forget that. in we are starting to see it corporations earning forecast. gina: corporate's have been slow to give us a lot of information because like the rest of the world anticipating the effects of this when we do not know what the duration are. ,e have a handful of companies less than 30 s&p 500 companies have given us guidance. the vast majority of those are negative. a better way to think about it is analyst revision where we are seeing the most activity. analysts are attempting to get a sense of the real impact. or than 300 companies in the s&p 500 have reported downward revisions to their first quarter estimates. we have gone from 2% growth on q1 to negative growth expected already. it will only get worse as long
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as the coronavirus continues to extend the duration, the duration extends and it continues to ramp up globally. impact has notng just been q1, but the fact that analysts are reassessing the outlook for q2 and q3 and for the year as a whole. we are seeing the markets capitulate to the idea that some of the income lost will not be made up in the second half of the year. that is reflected in the 2020 estimate which is now going downwards. david: it raises questions in the tech sector or we will see a change in the supply chains that will have a long-term effect on the business. gina: it will be interesting in the tech sector, especially in the semiconductor space. i've been speaking to our analyst this morning about this. q1 is generally lost time in the semiconductor space anyway. what you need to see is a ramp-up in production in march and april in anticipation of the third-quarter order flow which feeds through the fourth holiday
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seasonality. you will see a lot of seasonal issues in tech. the biggest devastation now is on earnings in the consumer discretionary and the industrial space, where you have real loss that will not be made up for in the second half. that is where you are seeing the greatest price action with respect to prana virus and that will continue. david: it is not clear we have found bottom yet. gina: i do not think we have because companies have just started to guide and we have been through a fourth where analysts were trying to assess what the fourth quarter look like now we are trying to book it going forward. vonnie: that is gina martin adams in new york. now let's go to washington and wendy benjamin son. the spotlight last night was on michael bloomberg, the founder and majority owner of our parent company. where will it be tonight? wendy: the focus might continue to be a little bit on michael bloomberg. i do not think elizabeth warren will let up for a moment. she raised $7 million after the debate last week. i do think the field will turn
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to bernie sanders. he has now won the popular vote in iowa, he won new hampshire, he won in nevada. he is favored to win in california on super tuesday. he is doing well in south carolina, which has its primary on saturday. if there is a stop bernie movement, it will be on the stage tonight. david: it is something we have not seen yet. even though he was the front runner before, we have not seen them go after bernie sanders. do you think others will do what we have heard they want to do, which is turn the spotlight on bernie sanders. is it possible to get behind the movement? wendy: they may. i do not think they would consider it getting behind that movement. michael bloomberg has made it clear he is turning all of his firepower on bernie sanders. he has to stop bernie sanders. his campaign says he does not believe bernie sanders can be
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donald trump. the others probably will because they need to cut him down a little bit in order for them to gain enough delegates to keep going beyond super tuesday, which is going to be very difficult. centrists need to keep cutting down michael bloomberg so his spending advantage is decreased. david: sounds like the circular firing squad again, potentially. wendy: it does. benjamin,nks to wendy our political editor in washington. for how the markets are reacting today, abigail doolittle. is it coronavirus again? abigial: once again coronavirus. we are down 1%. what makes it more bearish than that on first glance is the fact that on the open we were higher. point the sox index this started on friday with that pmi miss on the services side,
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the idea that coronavirus is bleeding into the economy in the u.s.. as you were just talking about with gina martin adams, what we are always talking about, will it affect the corporate profit outlook? the answer is yes but it is not quantifiable. stocks,s selling slicing through moving averages. the bears will take stocks down even more. david: there is also some risk in lumping it altogether under the coronavirus. he pointed out that health insurers got hurt worse, there were some differentiated and other things going on inside the market that we might miss. abigial: when you have this sort of a selloff the degree to which we had yesterday, it was not panicked, but it was the worst day we had an two years, you tend to miss this stronger stories. -- stocksn the midway down in a big way, bonds down, the smaller side stories get
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lost as investors seek safety. david: abigail doolittle, thank you so much. now it is time to go to mark crumpton for bloomberg first word news. mark: congress is expected to grill u.s. health officials this week on the prana virus outbreak and what the united states is doing to prevent the virus from taking hold here. the white house is asked congress for $2.5 million. bloomberg has learned some officials feel the u.s. response has not been aggressive enough, while others worry placing too many restrictions could hurt the u.s. economy. president trump is optimistic there will be a deal with the taliban to end the war in afghanistan. the president spoke in a news conference in new delhi. president trump: we are pretty close. we will see what is going on. we have two days under our belt without violence or a minimum of violence. mark: american and taliban leaders plan to sign a peace
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dell saturday if a weeklong reduction of violence that began last saturday stays in place. in india, a new citizenship law that excludes muslims has triggered more violence. hindus carrying pickaxes and iron tools hurled locks -- roxette muslims in new delhi. yesterday at least seven people were killed. 100 others were injured. india has been wrapped by violence since parliament approved the sedition ship law in december that provides fast track naturalization for foreign-born religious minorities but not muslims. former egyptian president hosting mubarak is dead. he was 91. he ruled for 30 years be for being forced out of office by the arab spring uprising in 2011. he went on trial for the killing of more than 850 protesters by his security forces. he was only found guilty of fraud. 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.
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i'm mark crumpton. this is bloomberg. david? david: coming up, we will go live to charleston, south carolina for a of tonight's big debate. " on is "balance of power bloomberg television and radio. ♪
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david: this is "balance of power" on bloomberg television and radio. democratic presidential candidates are returning to the debate stage in charleston, south carolina ahead of the states primary on saturday. our very own kevin cirilli is on the scene in charleston and this is what is going on. what should we be looking for? kevin: a lot of fire against senator bernie sanders, who now
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assumes his official front runner status after waiting in the nevada caucus. expect many of the campaigns to target him and comments he made as a relates to fidel castro. saying hisoe biden campaign is putting all of their money in south carolina, being bolstered by the large african-american community, he hopes, that he feels will back his campaign ahead of the contest this weekend. this is the final pitch that many voters, that many of the campaigns will have to make their pitch to voters. one more word about bernie sanders. last night at a cnn town hall he if heked point blank that doesn't receive the 1991 delegates necessary to clinch the nomination, would he still feel if he leads in delegates he deserves to be the nominee. he says if he gets in "plurality" of delegates that person deserves to be the nominee. already jockeying about that
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specific 1991 number. david: son of a gun. thanks to kevin cirilli reporting from charleston. bloomberg radio will have full coverage of the debate with kevin hosting. for more, we welcome our political panel of the former chairwoman of the nevada state formercan party, and the executive director of the new york state democratic party. welcome. it is good to have you with us. what are you expecting to look for out of the debate tonight and how critical is it joe biden show up? basil: it is do or die for joe biden. if he does not win south carolina he is hobbled going into super tuesday on a day when two of the most delicate rich people in the country will vote, california and texas, which bernie sanders is projected to win because of latino population and his support there. i think joe biden has to win the debate tonight, he has to win in south carolina. the truth is all eyes will be on
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bernie sanders. he is the front runner now. if you heard pete buttigieg after the nevada k-pop us -- after the nevada caucuses, i think there'll be a lot of attacks on him. michael bloomberg, my guess is he will have a better debate than he did last week but bernie sanders will be the focus of the attention. david: let's talk about bernie sanders for a minute. bernie sanders is talking about bernie sanders and not backing off some of his positions. this is what he said about fidel castro. >> we are very opposed to the authoritarian nature. not everything is bad. when fidel castro came into office, he had a massive literacy program. is that a bad thing? david: he taught a lot of people how to read. that is on 60 minutes from cbs. at the same time he does not seem to be more vulnerable. amy: which is terrifying in my opinion. this literacy program he was
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claiming was established underneath castro is false. they already have a high literacy rate and they have a program in place prior to that regime. this is a man who killed his own people, who put his own people into concentration camps. these are people who make may be hundred dollars a year. would bethink you seeing people trying to escape in rafts by the drove if this were such a wonderful environment. david: that does not seem to bother many democratic voters. basil: we can have a long conversation about cuba. the truth is there a lot of voters who will look past whatever remarks he made. ton barack obama tried normalize relations with cuba. to normalize relations with cuba. there is a more robust conversation that folks need to have about it. that said, i think he needs to talk more about how he is going
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to pay for the policies he is proposing. on the others, the energy he is getting is because of what he is proposing. he wants health care for everybody, he wants to make college affordable for everybody. who will be against that? he has to talk about how he will do it. specifically in cuba, i think joe biden said he will probably lose florida as a result of that. that is concerning for me in a general election specifically. take the portg to away from bernie sanders. david: i want to talk about michael bloomberg, the founder and majority shareholder of our parent company. it is fair to say he did not have a good first outing. what does he need to do tonight? amy: very fair to say. i hope he did his debate prep. he can only go up from his last performance. it was apparent he did not prepare himself. there is a little bit of arrogance on his part walk in thinking it will be a cakewalk. if you are going to go up
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against president trump who is quickwitted, sharp with the tongue, you need to know your issues inside and out. -- i do nottonight to see entertaining -- it would be entertaining for me to see a repeat of the last debate -- but it would be night does -- nice to see he did his homework. to be if it is not going bernie sanders, to some of the moderates have to drop out? basil: absolutely. my theory has always been bernie sanders in mike bloomberg have the money to go the distance. what will have to happen is someone, whether it is president obama, the donors, some of the unions, go to these candidates and say you need to drop out. we need to get behind one candidate as an alternative to bernie sanders if it comes to that, some moderate. that might be joe biden, that might be bloomberg. that conversation will have to
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happen. i thought amy klobuchar was going to drop out the other night. it sounded like it. biden needsesident to understand he is running for present and not senate like he announced today. david: that was unfortunate. many thanks to our political panel. tune into our special coverage of the super tuesday election coming up one week from today starting at 7:00 p.m. eastern time. of ourup, part conversation with the director of the federal housing finance agency. this is "balance of power" on bloomberg television and radio. ♪
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david: this is "balance of power" on bloomberg television and radio. i am david westin. time to check on the health of the housing market. we've been talking with the director of the federal housing finance agency mark calabria who sat down with michael mckee on
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the future of fannie and freddie and more. mark: we can already fix fannie and freddie and release them from conservatorship. we cannot fix the basic model. i have the model i have. i can do what i can to get them back out, but there are fundamental flaws to the model that only congress can fix. michael: will you be going with congress with proposals? mark: yes we will. we'll be asking for bigger changes. i think there is benefit the competition. benefit ofas the reducing too big to fail. we have two these entities and we are dependent on them. if we had five or six or seven, anyone orders two of them could get in trouble. michael: you talked about reducing risk in their models and their portfolios. if you did that, would you need them? mark: i think you can strengthen them and make sure they are safe and sound. to me the primary purpose of
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fannie and freddie is countercyclical liquidity. at a time of stress -- that has to be important even for good quality loans. even for good quality loans. it was only until the 1990's when credit quality at fannie and freddie started to decline. they have an important role that can support quality lending and we want to make sure that is what they are focused on. michael: in terms of the role, what is your goal? it used to be we wanted everybody to own a house. where are we? mark: we want homeownership to be sustainable. we saw last time we got a lot of people going into the top of the market and they got wiped out, lost a lot of wealth, lost their jobs, found themselves underwater. we are focused on phone homeownershipn that is sustainable homeownership. we get somebody in, they are into stay. this will be a success story. michael: let's talk about the timetable for getting them out. you're talking about it as a 2021 event? mark: it is process dependent,
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not calendar dependent. what we are focused on is the things we need to do will take us another year to do the things we need to do to build up fannie and freddie, to build up the agencies so we are ready for an exit. there a lot of pieces that need to be put in place. i would love if we could do a big capital rate today, but we are not in that position. david: that was michael mckee. staying with the housing area, our stock of the hours home depot, having its best day since august. the stock is up 2% after the company beat estimates. kailey leinz is here to explain how they did it. kailey: a nice upside surprise for the market given that last quarter home depot took down its guidance. today they have upside earnings of $2.28 coming in seven cents above the estimate. they also surprised on same-store sales. the street was expecting 4.7%. what home depot has to think that is the strong housing environment. low rate environment, cheaper mortgages.
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not only that, home prices are higher. people are more likely to invest in home improvement if they think they will get a better return on their investment. home depot benefiting. david: any benefit to coronavirus or is this relatively immune? kailey: it is relatively immune. the impact will be in the supply chain. 30% of its goods are sourced outside of the u.s., a big part of that in china so that is where that might show up. david: thank you so much to kailey leinz for that report. coming up next, she served as the chair of the congressional black caucus and is the cosponsor of tonight's democratic debate. we talk with parker's woman marcia fudge of ohio -- we talk with congresswoman marcia fudge of ohio. this is bloomberg. ♪
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david: from new york, this is "balance of power" on bloomberg television and radio. i'm david westin. for bloomberg first word news, we go to mark crumpton. mark: president trump is trying
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to ease fears about the united states. speaking in india today, the president said the situation is " very well under control in our country." on monday, the trump administration asked congress for an additional $2.5 billion to prepare in case of a widespread outbreak and to help other nations. hillary clinton has expressed her skepticism about bernie sanders but says she will support whomever becomes the democratic nominee. ,he former secretary of state who beat sanders for the nomination in 2016, criticized him in a new documentary saying nobody likes him, nobody wants to work with him. speaking in berlin today, clinton said her top priority is seeing trump defeated in november. european union's chief brexit negotiator is handing british prime minister boris johnson and ultimatum.
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nois warning there will be a trade deal unless the u.k. agrees to the demand for fair competition and fishing. days beforebrussels the sides are due to open formal trade negotiations. investigation has found opera superstar placido domingo had inappropriate activity with women. the probe was conducted by performers union in the u.s. and prompted domingo to issue his fullest apology yet. american career was put on hold last year after allegations of sexual misconduct. 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'm mark crumpton. this is bloomberg. david: thank you so much. marcia fudge has served as the democratic congressman or ohio for 12 years, representing a district that represents much of cleveland and akron. she was the chair of the impression of what congress in
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congressional black caucus. hopedemocrat, what do you to get out of tonight's debate and the primary coming up on saturday? what will be a success for the democrats on saturday? marcia: success for me tonight will be that the candidates address the issues that affect people from south carolina and other places. in particular, south carolina. issues to talk about it yo like education, poverty. i hope that is what happens, that we don't get caught up in things that are not really at the root of what we believe in. we have to talk about gun control. we are across the street from emmanuelle, where the shooting took laced. we need to talk about who stands with us to make our neighborhoods safer, and who doesn't. i hope that we really talked
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about what affects people in south carolina. david: perhaps more pointedly, where the candidate differ on those issues. some issues raised with bernie sanders and his record on gun control, gun legislation. is there something to differentiate the candidates, one from the other? marcia: no question. in the house, we passed something called getting rid of a alstom loophole. bernie sanders voted against it. we could be suing gun manufacturers today but bernie sanders voted against it. it is important to make a clear distinction as to where people stand. the questions are asked properly, we will get a distinction tonight. david: you took a position about 11 months ago, that you had some reservations about bernie sanders. you said, i'm not sure someone that far-left can win. as theyt as far liberal come but i'm also pragmatic and understands how government runs.
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you went on to say specifically about bernie sanders, that you have doubts. have you changed your mind? marcia: i have not. i believe this country is centerleft. i do believe the candidate that we choose, that can win, must be centerleft as well. that then brings into place the kind of coalition it takes to beat donald trump. it becomes a large -- as we say, big tent. the democratic party. i understand there is some havesity in the places we been, but a national election is different from a state election. i'm hopeful that our candidate will be somebody that is more centerleft. david: one of the issues that we talk about with south carolina is the african-american population. substantial spanish population in nevada. small representation in both iowa and new hampshire. from your point of view, what
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issues appeal to african-americans across the country? marcia: let me make one distinction about nevada. but whenda is diverse, you vote in a caucus, less than 5% of the electorate votes. i don't think it is a proper representation of people in the state. i would say what people in south carolina want to hear is, what are you going to do that will make my life better? what will you do for my family, my community? how does my vote for you make my life better? david: looking forward to the primary coming up where we see polls indicating joe biden is ahead. is that your sense of the state at this point? marcia: it is my sense. you have to realize the vice president has a long history with people in south carolina. he used to vacation here, was here often during the presidency of barack obama. it's important that people know him. who vote, most of us
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for people that we either like, or believe in their policies. for south carolina, joe biden probably hits both of those. david: play this forward, to milwaukie in july. there has been talk about what would happen if somebody like bernie went in with a substantial plurality but less than a majority. what would happen to a convention like that? are you concerned about pulling the party back together in that sort of scenario? marcia: i am really not a good people forget hillary clinton, four years ago, went in with a majority, the number of votes necessary to win. mr. sanders still took it to a vote. you cannot have it one way now, and another at another time. set inve the rules are place, and i think they will work. david: you serve as the chair on the subcommittee of elections in the house. some reports now about some possible intelligence indicating
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the russians are trying to interfere again, some favoring bernie sanders, some president trump. favoring bernie sanders, some president trump. what do you know about that, and should we be doing more to try and prevent that? marcia: there is no question we should be doing more. but it also starts at the top. the president needs to admit russia meddled in his election four years ago, and is meddling in this one. it is indisputable. our intelligence people have said it. refuses toident accept our own intelligence, i don't know where we are as a country, where you decide to do away with the judiciary, put people on courts that are not qualified, ignore the advice of our intelligence community. the only thing that can happen now is for the congress to step up and pass the kinds of legislation that requires us to do more. we know that they are attacking african americans in particular. we know they are targeting
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poor, ino are particular, because they are trying to keep us from voting. that is what suppression is. david: some of what we saw in 2016 was misrepresentations of people who claim to be for african-american communities, and they turned out to be russians. are we better off today than we were then? certainly. we know what they are doing, we have a lot more intel, information. we are better off but we are not good enough. we need to do more. if we do not, what we will find is we will have more interference than we had in 2016. the president is concerned, frankly, that he is not a legitimate president today, so he doesn't want to make that -- admit that they are meddling in this election. david: really good to be with you. marcia fudge of ohio, in south
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carolina. income inequality ways on the economy and the electorate as we head into an election year. what can be done? we speak to the president of the rockefeller foundation about their mark and the solutions they have come up with. this is "balance of power" on bloomberg television and radio. ♪
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david: this is "balance of power" on bloomberg television and radio. i'm david westin. inequality in the united states has grown by just about every measure over the last generation. president trump in his state of the union address claimed things were getting better under his administration. >> the unemployment rate for african americans come hispanic
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americans, and asian-americans has reached the lowest levels in history. african-american youth unemployment has reached an all time low. african-american poverty has declined to the lowest rate ever recorded. we welcome someone who has taken on the task of assessing income inequality, its causes, effects, and what can be done about it. rajiv shah is the president of the rockefeller foundation. foroins us from washington today's conversation in chief. thank you for being with us. you heard what the president said. give us your assessment about where income inequality is in the united states. is it getting better? rajiv: thank you for having me and for tackling this important subject. is, we know across
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democratic and republican administrations, over the past four decades, income inequality has gotten much, much worse in the united states. in the prior era more than 40 years ago, the corporate profit share of gdp was roughly 5%. it doubled to 10% now. ,e have seen a commensurate almost exact reduction in the share of gdp that goes to workers through wages. we have an economy that really does reward capital and really does punish wage labor. that is why nearly 40% of american households do not have $400 to handle an emergency, feel like they are falling behind every week, every month, and cannot be hopeful about their children's futures. that is not the kind of america we want to live in. we need practical solutions to address that. david: in order to address those solutions, we need to understand the causes. to what extent, from your
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analysis of looking at the data, how much is government policy, and how much is things like technology? how much is globalization? rajiv: i think there are three major causes. of thezation, the rise middle class has put downward pressure on u.s. way to major -- wage labor over the last several decades. note,, in fact, as you the reality that tax policy in particular has been increasingly unfair. america payires and the least effective tax rate of any population in this nation. it was not like that 40 or 50 years ago. it is like that now. even in the last tax bill, we saw the reduction in corporate tax rates has yielded an actual, realized share of corporate tax
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collections probably around 10%, 11%, which is extraordinarily low by historic standards. technology is of course a cause, but right now in a very hot economy, there are jobs available. people are working, unemployment is low. jobsssue is, 40% of those don't allow those families in have households to an enough food on the table, cover prescription costs, and be hopeful about their children's future. the presidentd say real wages are increasing for some of the lower portions of the economic scale. all the numbers out of the fed suggest. some say it is because of increases in minimum wage laws. how much are they really a solution to the problem? rajiv: in the inflation-adjusted increase at wages at the bottom of the u.s. labor market is roughly around 9% over the last
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few years. over the last 40 years, it is still probably negative. joe stiglitz suggested it is a -3% over 40 years. make a safe statement to to say that america's workers have not received a raise in 40 years. in that timeframe, basic expenses for education, health care cost, housing in particular , have skyrocketed. whereas it used to take 30 years of labor work to cover your basic needs, today it takes 53. that is why the rockefeller foundation is making a $65 million investment in partners around the nation to identify solutions that we think can work , at scale, and can work tens of millions of low-wage workers in this country meet their basic needs and be hopeful about mobility and upward mobility for their children's futures. about one oftalk
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those solutions, the earned income tax credit. what is your assessment of where we are with that, and is that a solution? rajiv: it is absolutely a part of the solution. reminded my colleagues that this was a policy that had bipartisan support. it was introduced by richard nixon as a negative income tax, picked upy nixon, cli by clinton and obama. it works simply. if you have a job, you earn income, and cannot make ends meet, you can apply for the earned income tax credit. on average, you get about $3300 a year. that helps mostly women head of households for children pay for health care, child care, improve educational outcomes for kids. no american policy has been studied more carefully. without question, it's the most effective way to address poverty amongst the working poor in america, and create better
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outcomes for children from a child care, health care, and education perspective. we believe it could be doubled or expanded aggressively at the federal level. there is a tremendous amount of innovation at the state and local level, where they are finding ways to adapt it to be even more useful as a real tool to help 30 or 40 million americans with set themselves and have the resources to invest in their children's future. david: if we -- at the federal level, how much would that cost? rajiv: about $60 billion a year, over 10 years. if you put that in context, the last trump tax cut was a $2.3 trillion tax cut over 10 years. went -- 83% of those gains went to the top 1%. had we taken just a share of that and invested into america's working families, we would see much better outcomes for children, their learning,
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futures. those are the kind of investments that we need to be discussing, debates we need to be having, about how we can invest in people, and not just markets, to lift up 40% of the american population that has really lost faith that their children will do better than them. they have lost faith in the american dream. it doesn't have to be that way. david: you went to the question i was going to ask. i want to distinguish and federal expenditures whether they are expenses or investments. if this is an investment into the earned income tax credit, into their future productivity, what is the return on investment? are their numbers to suggest how much more those people would make, the return on the economy? rajiv: we have seen the upper economic mobility. the statistic that you showed, when my parents emigrated to the united states, 90% of kids born in america were going to do better than their parents. today it is less than 50%.
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50% of to be that america's kids born into poverty ended up in the middle class. today, about 20%. policies like the earned income tax credit have been studied extensively. we have supported innovations at the state and local level. we supported those studies, so we know they were. we have also seen the ability to bring bipartisan support to expand them. we help support a coalition in california that supported a major expansion of it last year. in maine, a different state, did the same. now it is on the docket in a red state like missouri, blue state like illinois. when you see that kind of innovation and you see that commitment, the research and data at the state and local level, it makes you wish that our federal political dialogue was more focused and more successful. david: we want to talk about that more in a short amount of time. that is rajiv shah. we will be hearing more from him
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in the next hour on bloomberg radio. coming up, u.s. stocks are extending their slide, putting the s&p on pace for its biggest four-day slump since december 2018. president trump is warning it could get worse if he is not reelected. more on that ahead. this is "balance of power" on bloomberg television and radio. ♪ and radio. ♪
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david: this is "balance of power" on bloomberg television and radio. i'm david westin. continued bad news about the coronavirus is sending equity market down again today but not nearly as much as yesterday. speaking from india, president trump says the reaction to covid-19 was nothing very to if a democrat beats in mid-november. >> when we win reelection -- i think we will -- when we win, the markets will go up, it will be like a rocket ship, like last time, but even more so.
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the fact that the democrats are so radical, so out of control, they honestly don't know what they are doing. are going ton, you see a crash like you have never seen before. for an update on the markets, we bring back abigail doolittle. i guess it is the fear of the democrats. abigail: certainly an interesting there it is. some people are talking about the fact that yesterday selloff could have had to do with bernie sanders big win in nevada. i would respectfully disagree with the president on this. in particular, he did not name sanders, but the idea that it was going toward that democratic socialism brand, i would disagree. he is taking advantage of the market selloff to float faulty logic in terms of stocks go down, crazy democrats. when he is running later this year, perhaps he can continue to have that idea out there. the reason this selloff has to do more with the coronavirus, first of all, it didn't start
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yesterday. it started on thursday with greater than 1% declines. then the fibers worsened over the weekend, so we had a big selloff yesterday. second, it was a synchronized globalized selloff. i have a hard time believing the kospi is down in korea because of bernie sanders. third, the degree of the stock market selloff -- bernie sanders won the new hampshire primary february 11. february 12, the market was up. earlier,inting at this stocks underperformed, but if you take the case that investors were playing those stocks on the idea that they would only go higher because bernie sanders is not going to win, you have a stock selloff, put together, you'll have some declines. david: at the same time, the president needs to have an explanation if the market keeps going down. starting to ask
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questions about how they are handling it in washington as well. abigail: of course, we will be hearing from richard clarida today. interesting to see whether this meets the standard for some sort of emergency. david: many thanks to abigail doolittle. coming up, balance of power continues on bloomberg radio. in the second half hour, we are , toing more with rajiv shah talk about what can be done about income inequality, and how it fits with the presidential race happening as we speak. that is coming up. this is "balance of power" on bloomberg television and radio. ♪
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