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00:00DAVID: FROM BLOOMBERG WORLD HEADQUARTERS IN NEW YORK, I'M DAVID WESTIN. WELCOME TO "BALANCE OF POWER," WHERE THE WORLD OF POLITICS MEETS THE WORLD OF BUSINESS. ON THE BRIEF TODAY, SARAH MCGREGOR ON CHINA TRADE TALKS UNDERWAY IN WASHINGTON. BILL FAIRES ON THE LATEST MISSION HILLS -- THE LATEST MISSILES IN NORTH KOREA -- LET'S START WITH SARAH MCGREGOR IN WASHINGTON. WHAT DO WE KNOW ABOUT THE NEGOTIATIONS GOING ON AS WE SPEAK? SARAH: THINGS HAVE TAKEN QUITE A TURN AND IT NOW LOOKS LIKE EXPECTATIONS ARE WIDELY SET THAT THERE WILL NOT BE A DEAL ANNOUNCED THIS WEEK. WE KNOW THE VICE PREMIER IS COMING. LOWER-LEVEL TALKS HAVE STARTED AND WE BELIEVE HE WILL BE HERE THIS AFTERNOON TO START THE HIGHER-LEVEL TALKS AND HAVE A WORKING DINNER. THE EXPECTATIONS ARE LOW HE WILL COME WITH AN OFFER IN HAND TO ALLOW THE U.S. ADMINISTRATION TO SEAL A DEAL. DAVID: IF THAT IS RIGHT, WE HEARD YESTERDAY FROM PRESIDENT TRUMP WHICH REITERATED WHAT HE SAID THAT AT MIDNIGHT TOMORROW -- IF THOSE TARIFFS GOING TO AFFECT, WHAT DOES THAT DO FOR THE STATE OF TALKS? CAN THEY PUT THE GENIE BACK IN THE BOTTLE? SARAH: THE THREAT OF TARIFFS HAS SOURED THE MOOD FOR THE TALKS. CHINA SAYS IT WILL RETALIATE TO THE U.S. INCREASING TARIFFS ON THESE GOODS. IT IS HAPPENING IN THE MIDDLE OF THE TALKS. THE VICE PREMIER WILL BE HERE. A MIGHT STILL BE MEETING WITH THE TARIFFS TAKE EFFECT. IT WILL NOT IMPROVE THE SITUATION. TRUMP WANTS TO USE THIS AS LEVERAGE TO GET THE DEAL HE WANTS TO GET AND HE IS THREATENING TO PUT TARIFFS ON ALL CHINESE IMPORTS. MORE MIGHT BE ON THE WAY. DAVID: THANKS A MUCH DOES SARAH MCGREGOR. LET'S TURN TO BILL. WE HAD ANOTHER REPORT OF MISSILES BEING FIRED FROM NORTH KOREA. BILL: RIGHT. WHILE MANY OF US WERE SLEEPING, NORTH KOREA FIRED TWO MORE SHORT RANGE BALLISTIC MISSILES. THEY LANDED INTO WATERS EAST OF KOREA AND WEST OF JAPAN. THOSE MISSILES ARE A VIOLATION OF INTERNATIONAL RESOLUTIONS AT THE U.N., THAT SO FAR THE INTERNATIONAL COMMUNITIES HAVE BEEN STAYING QUIET ON THESE KINDS OF VIOLATIONS IN THE HOPES IT KEEPS DIPLOMACY ALIVE. IT IS INTERESTING TIMING. RIGHT NOW THE STATE DEPARTMENT'S TOP ENVOY IS IN SOUTH KOREA. THERE SEEMS TO BE SOME SORT OF A MESSAGE BEING SENT TO THE U.S. AND SOUTH KOREA AS THEY ENGAGE IN TALKS ABOUT THE NEXT DEPTH AND HOW TO DEAL WITH NORTH KOREA. DAVID: YOU COVER NATIONAL SECURITY AND MISSILE TESTS. IS THERE ANY APPARENT TECHNICAL OR STRATEGIC PURPOSE OTHER THAN GETTING OUR ATTENTION? WHAT WAS IS GOING TO PROVED ANYBODY? BILL: IF THERE IS A STRATEGIC ASSESSMENT TAKING PLACE, IT IS ONE SENDING A MESSAGE TO THE U.S. ENVOY MEETING IN SEOUL. ONE OF THE THINGS HE IS THERE TO TALK ABOUT IS THE PROPOSAL TO SEND FOOD A TO NORTH KOREA. NORTH KOREA MAY BE SAYING THEY WOULD LIKE MORE THAN FOOD A. THEY ARE SUFFERING UNDER THESE SANCTIONS, AND I DO NOT THINK SHIPMENTS OF RICE FOUR-WEEK IS WHAT THEY HAVE IN MIND -- OF RICE OR WHEAT IS WHAT THEY HAVE IN MIND. NORTH KOREA IS ALWAYS FRUSTRATED WHEN IT IS NOT THE KEY ISSUE ON THE INTERNATIONAL STAGE. RIGHT NOW YOU HAVE THE TRUMP ADMINISTRATION IMMERSED IN TALKS WITH CHINA. THIS IS A WAY FOR NORTH KOREA TO DRAW ATTENTION AWAY FROM THAT. IT IS A MESSAGE OF WE WOULD LIKE TO SEE MORE FROM THE U.S. AND SOUTH KOREA AT A KEY TIME WHEN THE TRUMP ADMINISTRATION FOREIGN POLICY PLATE IS FULL. DAVID: THEY DO LIKE THE ATTENTION. PRESIDENT TRUMP HAS THAT DEADLINE FOR THE CHINA TRADE TALKS. IT TURNS OUT KIM JONG-UN HAS SAID HIS OWN DEADLINE AT THE END OF THE YEAR TO GET SOMETHING DONE ON HIS DEAL. ARE WE MAKING ANY PROGRESS? ARE THERE LOWER LEVELS OF DISCUSSIONS? BILL: THAT IS ONE OF THE THINGS THE ENVOY IS IN SOUTH KOREA TO TALK ABOUT. THERE ARE NO LEVEL -- NO LOW-LEVEL TALKS AT ALL. HE IS TALKING TO HIS COUNTERPARTS ABOUT HOW THEY CAN GET THE PROCESS RESTARTED. SOUTH KOREA IS KEEN ON HAVING THE PROCESS CONTINUE. MOON JAE-IN HAS STAKED A LOT OF HIS SUCCESS ON GETTING THE U.S. AND NORTH KOREA TO AN AGREEMENT. LET'S TURN TO CATHERINE WITH A STORY ABOUT U.S. TREASURY REDUCTION. WE HAD AN AUCTION OF 10-YEAR NOTE AND I WILL PUT UP A CHART THAT SHOWS THE BID TO COVER THE LOWEST IN 10 YEARS. CATHERINE: BY MANY METRICS THIS WAS A SLOPPY OPTION. SPEAKING TO PEOPLE IN THE MARKET, PEOPLE ARE RELUCTANT TO MAKE TOO MUCH OUT OF IT. ONE OPTION DOES NOT MAKE A TREND. IT IS GOING TO BE INTERESTING TO SEE HOW THAT 30 YEAR SALE AT 1:00 GOES DAVID:. DAVID:WE HAVE 30 YEARS GOING OUT. AT THE SAME TIME, THERE HAS BEEN AN INVERSION, THE FIRST TIME SINCE MARCH. DO WE MAKE MUCH OF THAT? CATHERINE: IF YOU DRILL DOWN INTO WHAT THE CURVE IS TELLING US, IT IS A BID FOR 10 YEAR TREASURIES THAT IS DRIVING THESE YIELDS TO FLIP. THAT IS REFLECTING THE FACT THAT WE ARE SEEING A BIG RISK OFF IN MARKETS TODAY AND THE 10 YEAR YIELD IN PARTICULAR IS RESPONDING TO THAT. THE THREE-MONTH SECTION OF THE CURVE, WHICH IS MORE REFLECTIVE OF BIT RATE HIKE EXPECTATIONS. THAT HAS BEEN RELATIVELY ANCHORED TODAY. THIS IS REFLECTING THESE TRADE HEADLINES THAT THE MARKET HAS HAD TO DIGEST. DAVID: IT ALL LEADS BACK TO CHINA TRADE. CATHERINE: ABSOLUTELY. DAVID: LET'S FIND OUT WHAT IS BEEN GOING ON IN THE MARKETS. WHERE ARE WE? EMMA: A SLIGHTLY PALMER DAY YESTERDAY, THE RISK OFF TONE HAS RETURNED. TAKE A LOOK AT THE DOW JONES, S & P, AND THE NASDAQ ALL ALL MORE THAN 1%. READ ACROSS THE SCREEN. OFF THE LOWS BUT STILL LOOKING AT SIGNIFICANT LOSSES FOR THE MAJORS. WE ARE ALSO LOOKING AT SIGNIFICANTLY HIGHER VOLUME, ESPECIALLY WHEN YOU TAKE A LOOK AT THE DOW AND THE NASDAQ. VOLUME FOR BOTH AT 30% HIGHER THAN THE 20 DAY AVERAGE. YOU TAKE A LOOK THE S & P 500, EVERY SECTOR IN THE RED. LED LOWER BIOTECH AND INDUSTRIAL MATERIALS. THE S & P 500 FALLING FOR THE FOURTH DAY IN A ROW. IF YOU LOOK AT THE DEATH OF THE RED BAR, IT IS MIRRORING THE RED BARS WE HAD A DECEMBER WHEN WE SAW A LOT OF VOLATILITY IN THE MARKET. THE S & P 500 AND THE NASDAQ TRADING BELOW THEIR 50 DAY MOVING AVERAGE. SO ARE THE SOX, THE PHILADELPHIA SEMICONDUCTOR INDEX. NOW DOWN TO .4%. IT DID FALL BY 3.3% EARLIER. INTEL, WE DO NOT HAVE THE NAMES UP, BUT INTEL IS THE SECOND ONE, DOWN 5%. THAT IS THE BIGGEST LAGGARD ON THE STOCKS TODAY. ON COURSE FOR ITS 12 STOCK -- ITS 12 DROP IN 18 DAYS. NEWS ON INVESTOR CONFIDENCE YESTERDAY THAT THE GROWTH WOULD BE TEPID FOR YEARS TO COMP. LET'S TAKE A LOOK AT THE BATTLE FOR THE PERMIAN. WHO WAS THE WINNER? WE HEARD CHEVRON SAYING THEY WILL NOT INCREASE THEIR BID TO BUY ANADARKO. THAT ALLOWS OCCIDENTAL TO PREVAIL, BUT CHEVRON WALKED AWAY WITH A $1 BILLION TERMINATION FEE. THE CEO TOLD ALIX STEEL THAT WAS A WIN FOR THEM. DAVID: THANKS SO MUCH. IT TURNS OUT CHEVRON IS THE ONE STORY TODAY THAT DOES NOT LEAD BACK TO CHINA TRADE. COMING UP, TRADE IS IN THE SPOTLIGHT. WE TALKED WITH DEMOCRAT MAJORITY WHIP ABOUT HIS PARTIES -- ON THE MISSION GOING ON WITH CHINA. THAT IS NEXT. THIS IS BLOOMBERG. ♪ DAVID: THIS IS BALANCE OF POWER ON BLOOMBERG TELEVISION. WE TURN TO MARK CRUMPTON WITH BLOOMBERG FIRST WORD NEWS. MARK: NANCY PELOSI SAYS THE HOUSE IS NOT RUSHING TO A VOTE ON HOLDING ATTORNEY GENERAL WILLIAM BARR IN CONTEMPT OF CONGRESS FOR NOT PROVIDING ROBERT MUELLER'S FULL REPORT ON HIS RUSSIAN INVESTIGATION. NANCY PELOSI PELOSI SAID SHE WILL FOLLOW METHODICAL PROCESS. THE HOUSE JUDICIARY COMMITTEE APPROVED A CONTEMPT CITATION AGAINST WILLIAM BARR FOR FAILING TO COMPLY WITH A SUBPOENA FOR THE FULL REPORT IN THE UNDERLYING EVIDENCE. THE UNITED STATES AND CHINA ARE BOTH SIGNALING THEY WILL TAKE HARD-LINE POSITIONS WHEN TRADE TALKS RESUME. PRESIDENT TRUMP IS THREATENING TO RAISE TARIFFS ON $200 BILLION WORTH OF CHINESE PRODUCTS TOMORROW. BEIJING IS WARNING IT WILL RETALIATE. CHINA'S TOP TRADE NEGOTIATOR ARRIVES IN WASHINGTON THIS AFTERNOON AND WILL GO IMMEDIATELY INTO TALKS WITH ROBERT LIGHTHIZER. MORE ON THIS STORY IN JUST A FEW MOMENTS. THE EUROPEAN UNION SAYS IT REJECTS ANY ULTIMATUMS BY IRAN OVER THE LANDMARK 2015 NUCLEAR DEAL. IRAN WARNS IT WILL SCALE BACK ITS COMMITMENTS AND LESS EUROPE FOLLOWS THROUGH ON PROMISES IT MADE REGARDING TRANSPORT, TRADE, AND BANKING. IRAN IS THREATENING EUROPE AFTER THE U.S. IMPOSED MORE SANCTIONS. PRESIDENT WITHDREW FROM THE NUCLEAR DEAL LAST YEAR. IN PARIS, THERE IS CONCERN FOR PEOPLE WHO LIVE AND WORK AROUND NOTRE DAME CATHEDRAL WHICH WAS BADLY DAMAGED BY FIRE LAST MONTH. OFFICIALS SAY THE CATHEDRALS MELTED ROOF HAS LEFT ASTRONOMICALLY HIGH LEAD LEVELS, UP TO 65 TIMES THE RECOMMENDED LIMIT IN THE PLAZA OUTSIDE AND ON ADJACENT ROADS. THE MAIN DANGER IS LEAD DUST THAT COULD COAT SURFACES OF NEARBY HOMES AND BUSINESSES. GLOBAL NEWS 24 HOURS A DAY, ON AIR AND @TICTOC ON TWITTER, POWERED BY MORE THAN 2700 JOURNALISTS AND ANALYSTS IN OVER 120 COUNTRIES. I AM MARK CRUMPTON. THIS IS BLOOMBERG. DAVID? DAVID: LET'S TURN BACK TO THE TRADE STORY MARK TOLD US ABOUT. WE THOUGHT WE WERE ON TRACK FOR A TRADE DEAL WITH CHINA BUT THEN PRESIDENT TRUMP ROCKED THE WORLD AND MARKETS WITH HIS TWEET THREATENING NEW TARIFFS. FORMER CHINA TRADE NEGOTIATOR WENDY CUTLER SAYS THE STAKES ARE HIGH. WENDY: THE STAKES ARE ENORMOUS ON BOTH SIDES AND THEY'RE BOTH FACING A SERIOUS ESCALATION OF TARIFFS AND OTHER MEASURES THAT WILL ONLY AFFECT CHINA AND THE UNITED STATES BUT THEY WILL AFFECT THE MARKETS, GLOBAL GROWTH, THE ASIA-PACIFIC REGION, U.S. CONSUMERS COME U.S. WORKERS, U.S. BUSINESSES. DAVID: WE WELCOME CONGRESSMAN DAN KILDEE OF MICHIGAN WHO SITS ON THE HOUSE WAYS AND MEANS COMMITTEE. HE JOINS US FROM CAPITOL HILL. THANK YOU FOR JOINING US. YOU HEARD WHAT WENDY CUTLER HAD TO SAY. GIVES AN INSIGHT INTO THE DEMOCRATIC CAUCUS. WHAT IS THE PROGRESSIVE POSITION ON TRADE AT THIS POINT WITH RESPECT TO CHINA? REP. KILDEE: SHE HAS IT EXACTLY RIGHT. THIS IS A BIG MOMENT. I WAS ONE WHO BELIEVED THE PRESIDENT WAS RIGHT TO TAKE ON CHINA. I WISH HE WOULD HAVE DONE IT BY ENGAGING OUR ALLIES RATHER THAN PUTTING THEM ON THE OTHER SIDE OF THE TABLE. THAT IS WATER UNDER THE BRIDGE. IN THIS CASE, THE BIGGEST CONCERN WE HAVE IS THAT WE NOT ACCEPT A DEAL THAT IS LARGELY A TRANSACTIONAL RESOLUTION. I THINK THAT IS WHAT CHINA WANTS. SOME OF US HAVE FEAR THAT IS WHAT THE PRESIDENT WOULD ACCEPT. I THINK IT IS A BIT OF A POSITIVE SIGN THAT ROBERT LIGHTHIZER AND THE PRESIDENT BOTH SEEM TO BE WILLING TO HOLD FIRM THAT WE WILL REQUIRE THESE STRUCTURAL CHANGES REGARDING STATE OWNERSHIP, INTELLECTUAL PROPERTY, THE OTHER STRUCTURAL PROBLEMS WE SEE IN THE WAY CHINA OPERATES AND EFFECTS THE GLOBAL ECONOMY, PARTICULARLY THE U.S. THAT IS WHAT WE NEED TO FOCUS ON. I WAS THE ONE SOUNDING THE ALARM BELLS THAT I THOUGHT THE PRESIDENT WOULD BE WILLING TO ACCEPT A TRANSACTIONAL RESOLUTION. I HAVE TO GIVE HIM CREDIT. I DO NOT ALWAYS AGREE WITH HIM, BUT I'M GLAD THEY'RE NOT WILLING TO ACCEPT SOMETHING THAT WOULD BE BASED ON THE INCREASED SOYBEAN EXPORTS RATHER THAN SOMETHING MORE FUNDAMENTAL. DAVID: THAT SOUNDS A BIT LIKE NO DEAL IS BETTER THAN A BAD DEAL AND IT ECHOES WHAT SENATOR SUMER HAD DOES -- SENATOR SCHUMER HAD TO SAY. HOW DOES THAT RESONATE IN YOUR HOME STATE OF MICHIGAN? ARE VOTERS FOCUSED ON THIS AND WANT TO THEY TELL YOU ABOUT IT? REP. KILDEE: THEY ARE FOCUSED ON IT IN THE SENSE THERE IS STILL SOME UNCERTAINTY IN THE ECONOMY. WE HAVE HAD 100 MONTHS OF SUSTAINED ECONOMIC GROWTH. THAT IS A GOOD THING, BUT THERE IS STILL THIS UNCERTAINTY AND THIS JUST ADDS TO THE UNCERTAINTY. IN MY DISTRICT THAT PLAYS OUT A COUPLE OF WAYS. MANUFACTURERS ARE BEING HURT WHEN CHINA DUMPS CHEAP STEEL AND/OR OUR ECONOMY, IT UNDERMINES OUR -- INTO OUR ECONOMY, IT UNDERMINES OUR MANUFACTURING BASE. I HAVE A LOT OF FARMERS AND THEY ARE GETTING HIT WITH THE RETALIATORY TARIFFS THAT ARE BEING PLACED AS A RESULT OF WHAT THE PRESIDENT IS DOING TO DEAL WITH CHINA. THEY WANT TO COMPETE, AND THEY WANT TO DO IT FAIRLY. THEY WOULD RATHER NOT BE PAID REPARATION FOR NOT BEING ABLE TO COMPETE. THEY WOULD RATHER COMPETE. THIS IS A COMPLICATED SUBJECT. I AGREE WITH SENATOR SCHUMER AND OTHERS. NO DEAL IS BETTER THAN A BAD DEAL, WHICH I WOULD CHARACTERIZE AS A TRANSACTIONAL RESOLUTION. I AM ALSO CONCERNED WE NOT GET INTO A PROTRACTED TRADE WAR WHERE TARIFFS ARE THE ONLY TOOL WE HAVE AVAILABLE. WE HAVE TO KEEP TALKING. I WOULD ENCOURAGE THE PRESIDENT TO ENGAGE OUR ALLIES, ENGAGE EUROPE, ENGAGE CANADA, TRY TO TAKE THIS ON IN A MULTILATERAL FASHION. DAVID: LET'S TURN TO ANOTHER AREA OF UNCERTAINTY WHERE THE PRESIDENT DID ENGAGE OUR ALLIES. THAT IS THE USMCA, THE SUCCESSOR TO NAFTA. IT TOOK A WHILE TO NEGOTIATE. HE HAS A BETTER VERSION OF NAFTA THAT IS PENDING. THE REAL HANGUP IS ON THE DEMOCRATIC SIDE IN THE HOUSE. YOU ARE THE CHIEF DEPUTY WHIP, YOU COUNT VOTES. WHAT ARE THE CHANCES OF GETTING IT THROUGH. POLITICO SAYS IT IS DOWN TO 45%. REP. KILDEE: I WOULD NOT PUT A PERCENTAGE ON IT, BUT I WILL SAY THERE ARE TWO QUESTIONS. WHAT ARE THE ODDS AND HOW ARE THE ODDS INCREASED IF WE PLACE MUCH MORE CLEAR PRESSURE ON MEXICO TO ACTUALLY DELIVER ON THE REFORMS THEY HAVE BEGUN TO APPROVE. THE QUESTION FOR US IS WHEN DO WE SAY WE BELIEVE MEXICO WILL BE MAKING THE FUNDAMENTAL CHANGES IN THEIR LABOR ENVIRONMENT, IN THEIR LABOR PRACTICES IN ORDER FOR US TO NOT BELIEVE THAT WE ARE JUST GOING TO SEE THE SAME THING WE SAW IN THE ORIGINAL NAFTA, WHERE THERE WERE MANY PROMISES MADE THAT MEXICO WAS GOING TO COME, AND THEN INTO THE 20TH CENTURY, AND WILLINGNESS THAT THEY WOULD HAVE REAL TRADE UNIONS. JUST PASSING THE LAW WILL NOT BE ENOUGH FOR MANY OF US. WE WILL HAVE TO SEE THEM TAKE DECISIVE ACTION. WE KNOW -- THIS IS ONE OF THOSE CASES WHERE THE PRESIDENT WAS RIGHT TO RENEGOTIATE NAFTA. THE REAL QUESTION IS DO WE TAKE MEXICO AT ITS WORD, OR DO WE REQUIRE THEM TO IMPLEMENT SOME OF THESE REFORMS? I TEND TOWARD BELIEVING WE WANT TO SEE REAL IMPLEMENTATION AND NOT FALL VICTIM TO THE NOTION THERE ARE SO MANY GRAINS OF SAND IN THE HOURGLASS AND THIS WILL RUN OUT. WE HAVE TIME TO LET THEM IMPLEMENT BEFORE WE HAVE TO TAKE UP ANY APPROVAL. DAVID: WE HAVE MAJOR TRADE ISSUES AND OTHER SPENDING IN THE CONGRESS. WE ARE SPENDING A LOT OF TIME IN THE MEDIA TALKING ABOUT ROBERT MUELLER AND HIS REPORT AND ATTORNEY GENERAL BARR AND WHETHER HE SHOULD TESTIFY. WHAT IS THE SENSE WITHIN THE DEMOCRATIC CAUCUS. IS THERE A SENSE THAT THE VOTERS BACK IN MICHIGAN CARE MORE ABOUT THINGS LIKE TRADE, BREAD AND BUTTER THINGS, THAN THEY CARE ABOUT WHETHER WILLIAM BARR TESTIFIES WERE DOES NOT? REP. KILDEE: THE PEOPLE I REPRESENT CARE MORE ABOUT THE KITCHEN TABLE ECONOMIC QUESTIONS THAT THEY WANT US TO WORK ON. THE PRESSURE WE HAVE TO FEEL IS THAT WHILE ON ONE HAND, WE HAVE TO DO OUR JOBS, WE CANNOT JUST IGNORE OUR DEFENSE OF OUR CONSTITUTIONAL PREROGATIVE, BUT WE HAVE TO MAKE SURE THAT DOES NOT CROWD OUT OUR ABILITY TO WORK ON THOSE ISSUES, ON HEALTH CARE AFFORDABILITY, ON ACCESS TO COLLEGE, ON GROWING AN WE THINK IS MORE INCLUSIVE. WE BETTER BE WORKING ON THAT. RETIREMENT SECURITY IS A BIG ISSUE FOR US. THAT HAS TO BE FRONT AND CENTER AND WE HAVE TO BELIEVE WE CAN DO THAT AND ALSO DEFEND THE CONSTITUTIONAL PREROGATIVES WE THINK ARE SO IMPORTANT WHEN IT COMES TO THE BALANCE OF POWERS AND THE SEPARATION OF POWERS UNDER OUR SYSTEM OF GOVERNMENT. DAVID: WENT BACK TO THE DEMOCRATIC SIDE, THERE WAS AT LEAST SOME HOPE THERE WOULD BE A COUPLE OF ISSUES -- REP. KILDEE: INFRASTRUCTURE IS THE BIG ONE. WHEN THE PRESIDENT MET WITH LEADERS AND AGREE HE WOULD ESSENTIALLY COMMIT TO TRY TO FIND A PATH FORWARD ON A $2 TRILLION INFRASTRUCTURE INVESTMENT, I SAW THAT IS A POSITIVE SIGN. THE DEVIL IS IN THE DETAILS. THIS IS NOT UNRELATED TO THE FIRST SUBJECT WE ADDRESSED. WHEN WE THINK ABOUT HOW WE COMPETE WITH CHINA, PART OF IT IS DETERMINED BY THE TRADE RELATIONSHIP. PART OF IT IS LOOKING WHAT CHINA HAS BEEN DOING. THEY SPEND 10 TIMES AS A PERCENTAGE OF THEIR GDP ON INFRASTRUCTURE. THAT HAS BEEN THEIR VANTAGE. THEIR BELT AND ROAD INITIATIVE IS MORE SIGNIFICANT THAN THE TRANSACTIONAL NATURE OF TRADE WHEN IT COMES TO THEIR ABILITY TO COMPETE. WE NEED TO GET INTO THE GAME. THE PRESIDENT UNDERSTANDS THAT AND THAT IS HOPEFULLY WHY HE AGREED TO A MUCH LARGER PACKAGE THAN MANY THOUGHT HE MIGHT. NOW WE HAVE TO WORK OUT THE DETAIL. DAVID: THANK YOU SO MUCH FOR YOUR TIME. THAT IS DEMOCRATIC CONGRESSMAN FROM MICHIGAN DAN KILDEE. AHEAD, DEMOCRATS IN CONGRESS PROPOSE LIMITING CREDIT CARD INTEREST AND VISA AND MASTERCARD TAKE A HIT. YOU CAN WATCH A PRESENTATION FROM BERNIE SANDERS AND ALEXANDRIA OCASIO-CORTEZ ON THE BLOOMBERG. THIS IS BLOOMBERG. ♪ DAVID: YOU'RE WATCHING "BALANCE OF POWER." I'M DAVID WESTIN. THESE THE AND MASTERCARD ARE STOCKS OF THE HOUR. BOTH TUMBLING AFTER DEMOCRATS PROPOSED CAPPING INTEREST RATES. EMMA: BOTH STOCKS STARTED THE DAY LOW BUT REALLY DROP DOUBLE-CLICK WHEN WE GOT THE HEADLINE THAT BERNIE SANDERS AND ALEXANDRIA OCASIO-CORTEZ ARE INTRODUCING A BILL TO CAP INTEREST RATES AT 15%. IT WILL ESTABLISH A NATIONAL USURY RATE AND WILL BE KNOWN AS THE LOAN SHARK PREVENTION ACT. THEY ARE SPEAKING OUT A WEBCAST ABOUT THIS PROPOSED BILL. IT IS INTERESTING THE FED KEEPS DATA ON THE AVERAGE INTEREST RATES AND WE HAVE A CHART WHICH SHOWS THIS. THE AVERAGE INTEREST RATE IS CLOSE TO 15%. THERE ARE VARIATIONS WHEN WE LOOK AT THAT. DAVID: I AM SORRY TO INTERRUPT YOU. WE WILL GO RIGHT TO THE WHITE HOUSE. PRESIDENT TRUMP IS TALKING ABOUT TRADE. PRES. TRU MP: THE FIRST QUARTER IS ALMOST ALWAYS THE WORST QUARTER. WE HAD 3.2 GDP. OUR UNEMPLOYMENT NUMBERS ARE THE BEST IN THE HISTORY OF OUR COUNTRY. WE ARE DOING WELL AND OUR COMPANIES ARE DOING WELL. EVEN IN THE GREAT STATE OF OHIO, GENERAL MOTORS, AT MY VERY STRONG URGING, I WAS NOT EVEN NICE ABOUT, BUT I APPRECIATE WHAT THEY DID. THEY SOLD THE BEAUTIFUL LORDSTOWN PLANT TO A VERY GOOD COMPANY THAT IS GOING TO MAKE ELECTRIC TRUCKS. THAT WORKED. THAT WAS THE ONLY THING THEY COULD SAY ABOUT OUR ECONOMY. LORDSTOWN. WHEN YOU HAD ALL OF THESE GREAT COMPANIES SPENDING BILLIONS AND BILLIONS OF DOLLARS COMING INTO OUR COUNTRY, THEY CANNOT TALK ABOUT IT. THEY ONLY MENTIONED THE ONE PLANT THAT WAS A GM PLANT FROM A LONG TIME AGO. NOW WE HAVE A GREAT COMPANY GOING IN TO MAKE ELECTRIC TRUCKS. INTERESTING IDEA, A LECTURE TRUCKS COULD -- ELECTRIC TRUCKS. > > WILL YOU ALLOW ROBERT MUELLER TO TESTIFY? PRES. TRUMP: I WILL LEAVE THAT UP TO OUR ATTORNEY GENERAL. THE MUELLER REPORT CAME OUT. IT WAS DONE IN CLOSE TO $40 MILLION, WITH 17 OR 18 VERY AGGREGATE -- VERY ANGRY DEMOCRATS WHO HATED DONALD TRUMP AND EVERYTHING THEY COULD HAVE AT THEIR DISPOSAL. THERE WAS NOBODY IN THE HISTORY OF OUR COUNTRY MORE TRANSPARENT THAN ME. I SAID GIVE THEM EVERY DOCUMENT AND EVERY PERSON. LET THE WHITE HOUSE COUNSEL -- THERE WAS NOT VERY MUCH TO TESTIFY. I SAID LET HIM TESTIFY. WHEN I HEARD 30 HOURS, I SAID THAT IS A LONG TIME. I LET HIM TESTIFY. I DO NOT HAVE TO HAVE PRESIDENTIAL PRIVILEGE. I DO NOT HAVE TO GIVE THEM A DOCUMENT. I GAVE THEM 1.5 MILLION DOCUMENTS. WHITE HOUSE COUNSEL, ANYBODY YOU WANT YOU CAN TALK TO. AT THE END OF THE TESTIMONY. NO CONCLUSION AND ESSENTIALLY NO OBSTRUCTION. A LOT OF PEOPLE SAY HOW YOU CAN OBSTRUCT WHEN THERE IS NO CRIME? IS WORSE THAN THAT. NOT ONLY WAS THERE NO CRIME, BUT THE CRIME WAS COMMITTED ON THE OTHER SIDE. WE ARE PROTECTING AGAINST A CRIME COMMITTED ON THE OTHER SIDE. AFTER SPENDING ALL THAT MONEY AND ALL THAT TIME, TWO YEARS, THEY COME UP WITH A REPORT AND ROBERT MUELLER IS NO FRIEND OF WINE, I HAD CONFLICTS WITH HIM -- NO FRIEND OF MINE, I HAD CONFLICTS WITH HIM. WE HAD A BUSINESS DISPUTE. HE LIKED JAMES COMEY. THEY WERE SUPPOSEDLY BEST FRIEND. YOU SEE HUNDREDS OF PICTURES OF HIM AND COMEY. WITH ALL OF THAT AND OTHER THINGS, HE WANTED THE FBI JOB. HE WAS CONSIDERED THE FBI JOB, WANTED IT AND THE DAY AFTER HE DID NOT GET IT HE BECAME THE SPECIAL COUNSEL. THAT IS A CONFLICT. WE HAD OTHER THINGS. THOSE ARE TREMENDOUS CONFLICTS. YOUR JUDGE HAS A BUSINESS DISPUTE WITH ME. YOUR JUDGE HAS A FANTASTIC RELATIONSHIP WITH JAMES COMEY. HE IS A PART OF THIS. HE IS A LIAR AND A LEAKER. YOUR JUDGE AS A SITUATION WHERE HE WANTS TO BECOME THE FBI DIRECTOR. WE CHOSE DIRECTOR WRAY INSTEAD, AND TOLD HIM I AM SORRY. THOSE ARE TREMENDOUS CONFLICTS. THEN HE PUTS ON HIS STAFF ALMOST ALL DEMOCRATS, MANY OF WHOM CONTRIBUTED TO HILLARY CLINTON, NONE OF THEM CONTRIBUTED TO ME. IT STARTED OUT A 13 AND WENT TO 18, AND THESE WERE ANGRY DEMOCRATS. THESE WERE PEOPLE WHO WENT TO HER, SUPPOSED TO BE A PARTY, TURNED OUT TO BE A FUNERAL ON ELECTION EVENING, AND WAS GOING WILD HE WAS SO ANGRY. THIS MAN NOW IS JUDGING ME. YOU HAD OTHER PEOPLE MAKE BIG CONTRIBUTIONS TO HILLARY CLINTON'S CAMPAIGN. THEY WERE ANGRY DEMOCRATS, IN ALMOST ALL CASES. ONE OF THE PEOPLE WORKED ON THE CLINTON FOUNDATION AS THE TOP PERSON AT THE CLINTON FOUNDATION. WITH ALL OF THIS, THEY CAME BACK, NO COLLUSION. THERE IS NOBODY THIS ROOM, INCLUDING YOU. WITH $40 MILLION, 18 ANGRY PEOPLE THAT HATED YOU, AND ALL THE OTHER THINGS I MENTIONED, THEY WOULD FIND SOMETHING. MAYBE JOHN NOT. GO AHEAD. > > MR. BARR TOLD LAWMAKERS HE DID NOT HAVE A PROBLEM WITH MR. MUELLER TESTIFYING. PRESIDENT TRUMP TO ME, IT LOOKS LIKE A REDO. THE REPORT COMES BACK, IT IS BEAUTIFUL. I HAVE NOT HEARD THE WORD RUSSIA IN A LONG TIME. WHAT HAPPENED TO RUSSIA? THE RUSSIAN WITCHHUNT. IT WAS SO ON COLLUSION -- WHICH, BY THE WAY, THAT IS BY FAR, THAT IS THE BIG DEAL. IS ALL ABOUT RUSSIA. THEY DON'T USE THE WORD RUSSIA ANYMORE. THERE IS NO CRIME. THE NEVER WAS A CRIME. IT WAS A HOAX. IT WAS A WITCH HUNT. THIS COMES BACK, AND IT COMES BACK TOTALLY EXONERATING DONALD TRUMP, AND A LOT OF OTHER PEOPLE. THIS WAS A TERRIBLE THING THAT HAPPENED TO OUR COUNTRY. I WILL TELL YOU WHAT THEY ARE ASKING. THEY ARE ASKING, HOW DID THIS WHOLE THING START. THAT IS WHAT PEOPLE WANT TO KNOW. I HAD AN EVENT. A LOT OF YOU WERE THERE. THOUSANDS AND THOUSANDS OF PEOPLE STANDING IN A FIELD -- THEY HAVE NEVER SEEN ANYTHING LIKE IT -- MEANING,. EVEN THE PRESS IT IS ALWAYS LIKE THAT. WE HAVE NEVER HAD AN EMPTY SEAT. HOW DID THIS WHOLE THING START? IT WILL BE HARD FOR THEM TO ANSWER THAT. YES, PLEASE. > > [INAUDIBLE] JOHN BOLTON. PRES. TRUMP: JOHN HAS STRONG VIEWS ON THINGS, WHICH IS PRETTY AMAZING. I ACTUALLY TEMPER JOHN. I HAVE DIFFERENT SIDES. I HAVE JOHN BOLTON, AND I HAVE PEOPLE THAT ARE LITTLE MORE DOVISH. ULTIMATELY I MAKE THE DECISION. I LIKE JOHN. I GET VERY GOOD ADVICE FROM JOHN. > > THE INTELLIGENCE COMMITTEE HAS SUBPOENAED DON JUNIOR, THE REPUBLICAN-LED INTELLIGENCE COMMITTEE. WOULD YOU MAKE OF THAT? PRES. TRUMP: I WAS VERY SURPRISED. SOMEONE ASKED HIM, NO COLLUSION, WE FOUND NO COLLUSION.I WAS VERY SURPRISED TO SEE MY SON . MY SON IS A VERY GOOD PERSON, WORKS VERY HARD. THE LAST THING HE NEEDS IS WASHINGTON, D.C. HE WOULD RATHER NOT EVER BE INVOLVED. REMEMBER, HE SAID TO ME A LONG TIME AGO WHEN I WAS THINKING OF RUNNING, DAD, IF I CAN HELP, LET ME KNOW. IT IS NOT MY EXPERTISE, IT IS NOT SOMETHING I REALLY LIKE, BUT YOU ARE MY FATHER, WHATEVER I CAN DO. HE HAS NOW TESTIFIED FOR 20 HOURS, A MASSIVE AMOUNT OF TIME. THE MUELLER REPORT CAME OUT. THAT IS THE BIBLE. THE MUELLER REPORT CAME OUT AND SAID HE DID NOTHING WRONG. THE ONLY THING IS, IT IS O PPO RESEARCH. DID YOU EVER DO OPPO RESEARCH? I DON'T THINK SO. [LAUGHTER] I KNOW HE NEVER DID OPPOSITION RESEARCH, BECAUSE HE IS A FINE, FINE MAN. I WOULD SAY 90% OF THE REST OF THE FOLKS -- WHAT THEY DIDN'T DISCUSS IS THIS WOMAN WHO CAME IN, WHO I WATCHED HER ON "THE TODAY SHOW" WHEN IT ALL STARTED. I'M JUST AN INNOCENT -- NO ONE REALLY KNOWS. CONGRESS KNOWS HER PRETTY WELL BECAUSE FOR YEARS SHE HAS WALKED AROUND ALL OVER CONGRESS. SHE CAME IN, AND SHE LEFT SUPPOSEDLY GPS FUSION. THOSE WHO MEET FOR A SHORT TIME WITH MY SON AND OTHER PEOPLE. THEY TALK ABOUT A SUBJECT, AS VERY WELL ADVERTISED AND BROUGHT OUT, NOTHING. IT WAS A NOTHING MEETING. JARRET D LEFT. HE SAID GET ME OUT OF THIS MEETING. IT IS A WASTE OF TIME. SHE WENT BACK TO GPS FUSION. THEY WROTE THE PHONY DOSSIER. WHY WAS SHE GOING TO GPS FUSION, WHY DID SHE GO BACK? THEN I HEARD DON -- DAVID: WE HAVE BEEN LISTENING TO PRESIDENT TRUMP AT THE WHITE HOUSE. HE STARTED OUT TALKING ABOUT TRADE, THAT IS WHY WE WENT TO IT. HE SAID HE GOT A LETTER FROM PRESIDENT XI, BUT THEN THE PRESS IN THE ROOM WENT INTO ROBERT MUELLER, DON JR, AND NOW WE ARE COMING BACK TO BLOOMBERG TELEVISION. SHE ANNOUNCED SHE WAS RUNNING FOR PRESIDENT IN 2020 IN PART TO TAKE A STAND AGAINST TWO PARTIES WHO "NEVER TIRE OF WAR." SHE SPEAKS FROM EXPERIENCE HAVING SERVED TWO TOURS IN IRAQ. DEMOCRAT GABBARD HAS SERVED IN HAWAII SECOND DISTRICT SINCE 2013. HELLO, CONGRESSWOMAN. OR SHOULD I SAY BELOW ALOHA? > > > > ALOHA. DAVID: HOW ARE YOU GOING TO STAND OUT FROM THE PACK > REPTILEREP. GABBARD: TO RESTORE THE VALUES OF HONOR, INTEGRITY, RESPECT, AND SERVICE FACTOR THE PRESIDENCY, AND PUT THE INTEREST OF THE AMERICAN PEOPLE FIRST AND FOREMOST. NOT THE INTEREST OF POLITICS, PARTISANSHIP, SELF-SERVING PARTISANSHIP, ACTUALLY PUT SERVICE ABOVE SELF, PUT THE AMERICAN PEOPLE FIRST. AS COMMANDER-IN-CHIEF. THESE WASTEFUL REGIME CHANGE WARS AND THIS NEW COLD WAR AND NUCLEAR ARMS RACE, AND TAKE THE TRILLIONS OF DOLLARS THAT WE HAVE WASTED AND THAT WE WILL CONTINUE TO WASTE ON THESE PROGRAMS, AND INVEST IT IN SERVING THE NEEDS OF THE AMERICAN PEOPLE. THINGS LIKE HEALTH CARE, EDUCATION, INFRASTRUCTURE, PROTECTING OUR ENVIRONMENT, AND SO MUCH MORE. IT IS THOSE EXPERIENCES THAT I BRING SERVING AS A SOLDIER FOR 16 YEARS IN THE ARMY NATIONAL GUARD, DEPLOYING TWICE TO THE MIDDLE EAST, AND SERVING IN CONGRESS FOR OVER SIX YEARS. IT IS THESE EXPERIENCES THAT I BRING TO THE JOB OF THE PRESIDENCY AND BEING THE COMMANDER-IN-CHIEF. DAVID: YOU ARE KNOWN IN PART FOR THAT POSITION OF NONINTERVENTION. WITH ONE KIND OF ENDORSEMENT, IRONICALLY, FROM RON PAUL WHO SAID TULSI GABBARD IS THE BEST. VERY LIBERAL WHEN IT COMES TO ECONOMIC. SHE IS GONE FOREIGN POLICY. SHE DOES NOT WANT THESE ENGAGEMENTS, WHICH IS AN ECONOMIC ISSUE. WE SAVE A LOT OF MONEY. RON PAUL IS WITH YOU AND AT THE SAME TIME THAT IS THOUGHT TO BE A FOREIGN AFFAIRS AFFAIRS ISSUE. IF YOU LOOK AT THE AMERICAN PEOPLE, FOREIGN POLICY DOES NOT RANK TOWARDS THE TOP. I DON'T REMEMBER THE LAST TIME A PRESIDENT WAS ELECTED ON FOREIGN POLICY. REP. GABBARD: THE MOST IMPORTANT JOB THE PRESIDENT HAS IS TO SERVE AS COMMANDER-IN-CHIEF AND KEEP THE AMERICAN PEOPLE SAFE. THE QUALIFICATIONS AND EXPERIENCE I BRING TO THAT JOB WILL BEST EQUIP ME TO ACCOMPLISH THAT MISSION. AS YOU MENTIONED, TOO OFTEN FOREIGN POLICY IS RELEGATED AS TWO SIDES WHILE THERE ARE MANY DIFFERENT DOMESTIC ISSUES THAT MANY OF THE OTHER CANDIDATES ARE BRINGING TO THE FOREFRONT. AS RON PAUL STATED, AND I HAVE STATED MANY TIMES COME YOU CANNOT SEPARATE THESE ISSUES, BECAUSE AS LONG AS WE SPEND TRILLIONS OF OUR HARD-EARNED TAXPAYER DOLLARS ON WAGING WASTEFUL REGIME CHANGE WARS THAT ARE COUNTER TO THE INTEREST OF THE AMERICAN PEOPLE, THAT UNDERMINE OUR NATIONAL SECURITY, AND INCREASE SUFFERING FOR THE PEOPLE IN COUNTRIES WHERE WE WAGE THESE WARS -- AS LONG AS WE CONTINUE TO DO THAT, WE WON'T HAVE THE RESOURCES WE NEED TO INVEST IN OUR CRUMBLING INFRASTRUCTURE, MAKE SURE WE HAVE QUALITY HEALTH CARE FOR ALL, PAYING OUR TEACHERS AND MAKING SURE WE ARE PROVIDING A QUALITY EDUCATION, AND MEETING SO MANY NEEDS THAT WE THE AMERICAN PEOPLE HAVE AT HOME. DAVID: THE DEMOCRATIC PARTY HISTORICALLY HAS HAD A CHALLENGE IN BEING PERCEIVED AS SOFT. SOFT ON COMMUNISM ALL THE WAY BACK TO THE COLD WAR. HOW DO YOU STAND UP TO THE VLADIMIR PUTIN? WHAT IS YOUR POSITION AND HOW DO YOU DEAL FROM A POSITION OF STRENGTH IF YOU SAY YOU ARE NOT GOING TO USE THE MILITARY? REP. GABBARD: LET ME CLARIFY. AS A SOLDIER I KNOW HOW IMPORTANT IT IS TO KEEP THE AMERICAN PEOPLE SAFE, TO MAKE SURE WE ARE FOCUSED ON OUR NATIONAL SECURITY. MAKING SURE THE DECISIONS WE MAKE WITH REGARDS TO OUR MILITARY ACTUALLY FULFILL THAT MISSION OF KEEPING THE AMERICAN PEOPLE SAFE, RATHER THAN CONTINUING TO DISHONOR OUR TROOPS BY SENDING THEM ON THESE MISSIONS WAGING REGIME CHANGE WARS THAT MAKE OUR COUNTRY LESS SAFE, AND ARE SO COSTLY BOTH FOR OUR TROOPS, THEIR FAMILY, AND FOR THE AMERICAN PEOPLE. WE HAVE TO MAKE SURE THAT WAR IS ONLY SEEN AS A LAST RESORT TO FULFILL THE MISSION OF KEEPING THE AMERICAN PEOPLE SAFE COME MAKE OUR FOREIGN-POLICY DECISIONS BASED ON BUILDING FOR RELATIONSHIPS THAT SERVE OUR INTERESTS, THE INTERESTS OF OUR COUNTRY, AND BASED ON COOPERATION RATHER THAN CONFLICT. DAVID: WE ARE WATCHING DONALD TRUMP STILL SPEAKING AT THE WHITE HOUSE. HE SAYS HE THINKS THAT A CHINA TRADE DEAL MAY BE POSSIBLE THIS WEEK. LET ME ASK YOU ABOUT CHINA. YOU HEARD MIKE POMPEO IN VARIOUS VENUES THIS WEEK TALK ABOUT THE CHALLENGE TO US ON THE FOREIGN-POLICY FRONT. HOW WOULD YOU ADDRESS THAT? THE POSITION OF CHINA AS A GROWING FORCE IN ASIA, AND FOR THAT MATTER, GLOBALLY? REP. GABBARD: WE CAN RECOGNIZE THERE ARE CHALLENGES THAT WE NEED TO ADDRESS WITH CHINA. WE ALSO NEED TO RECOGNIZE THAT THERE ARE AREAS OF SHARED INTEREST. NORTH KOREA IS OFTEN IN THE NEWS THESE DAYS. THIS IS ONE AREA WHERE IT IS ADVANTAGEOUS TO US AND THE WORLD TO BE ABLE TO WORK WITH A COUNTRY LIKE CHINA WHO IS A CLOSE ALLY OF NORTH KOREA TO ACHIEVE THE OBJECTIVE OF THE NUCLEAR RISING THE KOREAN PENINSULA -- OF THE NUCLEAR RISING -- OF THE DE NUCLEARIZING THE KOREAN PENINSULA. CHINA IS A NUCLEAR POWER. OFTEN TIMES PEOPLE HERE IN WASHINGTON FORGET THAT THESE ECONOMIC OR TRADE WARS CAN VERY EASILY ESCALATE INTO A HOT WAR. THAT PUTS THE AMERICAN PEOPLE AT RISK. THAT PUTS THE WORLD AT RISK. THAT IS WHY IT IS IMPORTANT WE HAVE THESE RELATIONSHIPS BASED ON CORPORATION, NOT CONFLICT. WORK OUT THE TOUGH ISSUES THAT NEED TO BE ADDRESSED, BUT RECOGNIZE THERE ARE ISSUES OF COMMON INTEREST WE HAVE TO BE ABLE TO PURSUE. DAVID: YOU HAVE BEEN TALKING ABOUT IMPORTANT ISSUES. EVERYONE A WOULD AGREE. WE HEARD THE PRESIDENT FIELD QUESTIONS FROM THE PRESS ABOUT ROBERT MUELLER, WILLIAM BARR TESTIFYING, INVESTIGATIONS GOING ON. CAN THE DEMOCRATS ON CAPITOL HILL OR SUE ISSUES OF TRUE IMPORTANCE OF THE NATION AT THE SAME TIME SPENDING TIME AND EFFORT ON THESE INVESTIGATIONS? REP. GABBARD: I GET THAT ROOM -- I GUESS THAT REMAINS TO BE SEEN MOST OF WHAT IS IMPORTANT IS THAT I SPENT THE LAST SEVERAL MONTHS VISITING COMMUNITIES AND HEARING FROM PEOPLE ACROSS THE COUNTRY. THEY ARE NOT ASKING ABOUT THE ROBERT MUELLER INVESTIGATION. THEY'RE NOT ASKING ABOUT WHAT IS HAPPENING WITH ATTORNEY GENERAL BARR. THEY'RE ASKING, WHAT ARE YOU GOING TO DO TO MAKE IT THAT MY SICK CHILD CAN GET THE HEALTH CARE THEY NEED? WHAT ARE YOU GOING TO DO TO MAKE SURE THAT OUR TEACHERS WHO ARE WORKING HARD EVERY DAY ARE ABLE TO GET THE PAY AND BASIC TOOLS THEY NEED TO GIVE OUR KIDS A QUALITY EDUCATION? WHERE YOU GOING TO DO TO MAKE SURE THAT WE ARE INVESTING IN THEM FOR STRUCTURES SO WE HAVE CLEAN WATER TO DRINK? EVERY AMERICAN HAS CLEAN WATER TO DRINK AND CLEAN AIR IN THIS COUNTRY? PEOPLE ARE BEING POISONED IN PLACES LIKE FLINT, MICHIGAN, COMMUNITIES IN NEW HAMPSHIRE AND IOWA, BECAUSE OF OUR CRUMBLING INFRASTRUCTURE AND CONTAMINATED WATER. THESE ARE ISSUES THAT WE NEED TO BE ADDRESSING IN CONGRESS, WORKING TOGETHER TO BRING ABOUT REAL RESULTS AND MAKING THOSE INVESTMENTS IN OUR COMMUNITIES THAT THEY SO SORELY NEED. DAVID: THANK YOU FOR YOUR TIME. THAT WAS CONGRESSWOMAN TULSI GABBARD COMING TO US FROM CAPITOL HILL. NOW BREAKING NEWS. NEXT ON HAS SET A 25 BILLION DOLLAR LIMIT ON HIS FLAGSHIP FUND. IT WAS OVERSUBSCRIBED 25 BILLION DOLLARS. BLACKSTONE WOULD SET AN INDUSTRY RECORD FOR A BUYOUT FUND. LIVE FROM NEW YORK, THIS IS BLOOMBERG. ♪ DAVID: YOU ARE WATCHING "BALANCE OF POWER." I AM DAVID WESTIN. THE PRESIDENT OF THE UNITED STATES HAS BEEN SPEAKING FOR SOME TIME ON A VARIETY OF SUBJECTS. ABOUT DON JR., ABOUT ROBERT MUELLER, ABOUT COHEN. SPRINKLED IN THAT IS HIS U.S.-CHINA TRADE NEGOTIATIONS. THAT HE GOT A LETTER FROM PRESIDENT XI, THAT THEY WANT TO WORK TOGETHER, THAT IT IS POSSIBLE TO GET A DEAL DONE THIS WEEK. THE PRESIDENT SAYS HE HAS AN EXCELLENT ALTERNATIVE. I'M NOT SURE WE KNOW WHAT THAT ALTERNATIVE IS. IT IS DEVELOPING EVEN AS WE TALK/ SO GOOD TO HAVE YOU WITH US. WITH ANY IDEA WHAT THE PRESIDENT MIGHT BE TALKING ABOUT? TARIFFS? > > I WISH I KNEW. WE SHOULD PROBABLY ASSUME THAT PART OF HIS PLAN IS TO MOVE AHEAD AS THE UNITED STATES PLANNED WITH THE INCREASE OF TARIFFS TO 25%. DAVID: GIVE US A SENSE ON HOW HIGH THE STAKES ARE. WE THOUGHT LAST WEEK IT WAS ON THE ROAD TO A DEAL. TRADE GROUPS. AS WELL. OVER THE WEEKEND WE YEAR FROM THE PRESIDENT. SOMETHING MUST HAVE GONE WRONG. DO WE KNOW WHAT WENT WRONG? > > WE DON'T KNOW WHAT EXACTLY WENT WRONG. BASED ON THE REPORTING, IT LOOKS LIKE THE DISCONNECT IS A COMBINATION OF FIRST, PRESIDENT XI WAS ANGRY THAT THE UNITED STATES WANTED TO MAINTAIN THE TARIFFS THAT ARE ALREADY IN PLACE UNTIL AT LEAST A SIX MONTH REVIEW OF THE TRADE AGREEMENT. SECOND, THAT THE UNITED STATES IN RESPONSE TO WHATEVER IT IS THAT CHINA TABLE TO SHOW THE CHANGES IT WANTED, LEGISLATIVE AND CHANGES. THEY ARE POLICY ISSUES. IDEALLY THERE ARE WAYS TO WORK THROUGH. I'M WITH THE PRESIDENT, I BELIEVE A DEAL IS POSSIBLE THIS WEEK. DAVID: THAT SOUNDS LIKE A NEGOTIATION. HAS THERE BEEN A LACK OF FAITH? WE HEARD ROBERT LIGHTHIZER DEVELOPED A RELATIONSHIP. HAVE THEY GONE OVER A RUBICON OF I'M NOT SURE I CAN TRUST YOU? > > I DON'T THINK YOU SHOULD VIEW ANY OF THESE THINGS AS CHANGING THE DYNAMIC BETWEEN THE TWO GOVERNMENTS. A GENERAL LACK OF TRUST. THAT DOESN'T MEAN YOU CAN'T LIKE THE PERSON ON THE OTHER SIDE OF THE TABLE, BUT THE U.S. AND CHINA HAVE A LONG HISTORY OF TRADE NEGOTIATIONS AND ARE SKEPTICAL OF THE INTENT OF THE OTHER SIDE. IT WAS ALWAYS GOING TO BE A TOUGH NEGOTIATION. DAVID: PRESIDENT TRUMP IS ALMOST OUT THE DOOR AND COMES BACK. HE SAID WE ARE GOING TO FIND ABOUT CHINA TONIGHT. A WORKING DINNER WILL HAPPEN TONIGHT. THAT MAKES IT HAPPENED THEY WILL KNOW IF WHOEVER WALKS OF THE ROOM WILL BE ABLE TO DO A DEAL OR NOT? > > THAT WOULD BE GREAT. IT DEPENDS ON HOW MUCH THE CHINESE SENT IN ADVANCE. THERE WERE LOW LEVEL DELEGATES HERE TALKING TO THEIR COUNTERPARTS YESTERDAY. WE WILL ONLY KNOW WHEN THEY MAKE A SPECIFIC OFFER. DAVID: SAY AGAIN? HE IS MEETING TONIGHT AT 5:00 P.M. GIVE US A SENSE FROM PRESIDENT XI'S POINT OF VIEW. THE PRESIDENT MAKES IT VERY HARD FOR HIM TO ACCOMMODATE PRESIDENT TRUMP WITHOUT IT APPEARING TO HIS OWN PEOPLE IN CHINA THAT HE HAS BEEN TO OVER FOR THE PRESIDENT OF THE UNITED STATES. > > I DON'T THINK SO. I THINK THERE ARE OPTIONS TO RESOLVE THIS. THE MATTER THE DISCONNECT, WHEN THE TARIFFS THAT ARE ALREADY IN PLACE ARE REVIEWED AND REDUCED, HOPEFULLY REMOVED, AND WHEN A MEASURE IS PASSED LEGISLATIVELY OR NOT. TIMELINES CAN BE ADJUSTED. CHINA HAS OTHER WAYS TO HAVE THINGS IMPLEMENTED THAT HAVE THE FORCE OF LAW BUT ARE NOT LEGISLATIVE CHANGES. THERE IS STILL A PASSOVER HERE. DAVID: TELL US ABOUT COMPANIES THAT ARE DOING BUSINESS IN CHINA. DO THEY BASICALLY AGREE WITH YOU THAT THEY THINK THAT A DEAL WILL GET DONE, OR ARE THEY INCREASINGLY DOUBTFUL? > > IT IS NOT A MATTER IF ANYONE BELIEVES ENOUGH THAT A DEAL WOULD GET DONE THAT YOU WOULD STOP PLANNING FOR THE INEVITABILITY OF A POSSIBLE BREAKDOWN OF NEGOTIATIONS. BUT COMPANIES HAVE BEEN DOING FOR THE PAST FOUR DAYS IS DUSTING OFF PLANS THEY MADE LAST DECEMBER WHEN WE THOUGHT THAT THE TARIFFS WOULD INCREASE TO 25%, DETERMINING WHAT THEY NEED TO DO TO EITHER ABSORB COSTS OR PASS THEM ON, AND LOOKING DOWN THE ROAD AT WHAT CHANGES WILL BE NEEDED TO BE MADE IF THIS IS A LONG-TERM ISSUE. DAVID: IF THE TARIFFS GO INTO EFFECT AT MIDNIGHT TOMORROW AS THE U.S. HAS SAID, HOW DIFFICULT IS IT TO TURN THAT AROUND? IS IT A PRACTICAL MATTER? WITH A COMEBACK IN A WEEK OR 10 DAYS? > > WE HAVE BEEN CHATTING WITH OUR COUNTERPARTS AT THE NATIONAL RETAIL FEDERATION WHO TELL US THESE THINGS CAN BE TURNED AROUND. THERE IS ALWAYS A DELAY AS THE LAWYERS DO THEIR WORK TO DRAFT THE EXACT LANGUAGE OF THE SUSPENSION, BUT IT COULD BE REVERSED AS SOON AS BOTH GOVERNMENTS COME TO AN AGREEMENT AND THE UNITED STATES DECIDES IT WANTS TO HALT THE IMPOSITION. DAVID: U.S. CHINA BUSINESS COUNCIL SENIOR VICE PRESIDENT. COMING UP FROM TRADE TO TECH. I PLAN ON WHAT TO DO WITH THE COMPANY HE COFOUNDED, FACEBOOK. HE WANTS IT BROKEN UP AND DAVID: THIS IS "BALANCE OF POWER." I AM DAVID WESTIN. CHRIS HUGHES HAS A SOLUTION FOR FACEBOOK, THE COMPANY HE COFOUNDED WITH MARK ZUCKERBERG A DECADE AGO. HE WANTS TO BREAK IT UP AND REGULATE WHAT IS LEFT OVER. HE WRITES, WE ARE A NATION WITH A TRADITION OF REINING IN MONOPOLIES. NO MATTER HOW WELL-INTENTIONED, MARK'S POWER IS UN-AMERICAN AND IT IS TIME TO BREAK UP FACEBOOK. WE WELCOME NOW THE BLOOMBERG SENIOR ANALYSIS FOR ANTITRUST. HOW PLAUSIBLE IS IT THAT UNDER EXISTING LAW THE AUTHORITIES COULD GO IN AND BREAK UP FACEBOOK? > > UNDER EXISTING LAW THEY COULD TRY. WE HAVE TO REMEMBER THAT THE FEDERAL TRADE COMMISSION AND DEPARTMENT OF JUSTICE DO NOT HAVE ANY POWER TO JUST BREAK UP A COMPANY. THEY ARE BOUND BY THE PRESIDENT THAT HAS BEEN DEVELOPED OVER MANY YEARS, SINCE 1890 WHEN THE SHERMAN ACT WAS PASSED. THEY HAVE STATUTES OF THAT WOULD ALLOW THEM TO GO AFTER CONDUCT OR SEEK TO BREAK UP THE COMPANY. IF THEY CAN DO THAT IN COURT IS DOUBTFUL. DAVID: THE CHRIS HUGHES WAS IN PART BECAUSE IT IS NOT JUST BREAK IT UP. HE GIVES YOU A PLAN. CUT ALONG THE DOTTED LINE. THEY SHOULD NOT HAVE LET THEM BY INSTAGRAM AND WHAT'S APP. THEY SHOULD TAKE IT BACK AWAY. IS THAT DOABLE? JENNIFER: IT ISN'T. THE FEC AND DOJ HAS THE POWER TO GO AFTER DEALS. THEY HAVE DONE IT IN THE PAST AND SUCCEEDED AND HAD COMPANIES PULL APART ASSETS. THEY HAVE TO WORK IN CONSTRAINTS OF THE STATUTES. WE HAVE COURTS THAT HAVE BEEN SYMPATHETIC TO BIG BUSINESS AND REQUIRE A LOT FOR THE FEDERAL TRADE COMMISSION TO REACH THE STANDARDS IT HAS TO REACH IN ORDER TO HAVE A BREAKUP. IT IS PROBABLY NOT SOMETHING THAT COULD OCCUR WITHOUT LEGISLATION. DAVID: IS THERE EVIDENCE WITH RESPECT TO INSTAGRAM AND WHAT'S APP THAT THEY RAISED PRICES AFTER THEY BOUGHT THEM? JENNIFER: IT WOULD TAKE A LONG INVESTIGATION. THEY HAVE TO HAVE EVIDENCE THAT THERE HAS BEEN BAD CONDUCT. THAT TAKES A LONG TIME. DAVID: FOR FULL EMPLOYMENT FOR OUR FRIENDS, THE LAWYERS IN WASHINGTON. COMING UP, HIGHLIGHTS OF ALIX 'S INTERVIEW. SIGN UP FOR THE "BALANCE OF POWER" NEWSLETTER. TO THE LATEST ON GLOBAL POLITICS IN YOUR INBOX EVERY DAY. LIVE FROM NEW YORK, THIS IS BLOOMBERG. ♪

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'Bloomberg Markets: Balance of Power' Full Show (05/09/2019)

"Bloomberg Markets: Balance of Power" focuses on the politics and policies being shaped by the agenda of President Trump's administration. (Source: Bloomberg_TV)

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