tv Whatd You Miss Bloomberg January 31, 2017 3:30pm-5:01pm EST
were a no-show at their confirmations today, a visibly irritated hatch did not hold back when he spoke to bloomberg tv. hatch: no one called me and there was no indication. was the rudest thing i've ever seen. >> what procedurally can you do to move the nomination forward? mr. hatch: a number of things. i think my colleagues in washington, hopefully it comes in the next -- taylor: he says he had no inkling the democrats plan to skip. senate democrats are using an up secure role to delay the committee vote on attorney general nominee jeff sessions after democratic senators on the senate judiciary committee gave lengthy speeches opposing sections for several hours. the chairman says the vote will be delayed until tomorrow. by giving lengthy speeches, democrats are able to deter a rule that does not allow
committees to be in session for two hours after the start of the senate a. ,he rule is generally weighed sessions is expected to be approved by the panel. school choice advocate betsy davos for education secretary after a heated debate this votedg, senators have 12-11 along partisan lines to support devos'nomination for full senate. is --minister theresa may trying to win allies for those brexit negotiations due to begin in a couple of months. ambassadors will be given a status and more staff for lobbying. news 24 hours a day powered by analysts in more than 120 countries.
this is bloomberg. ♪ scarlet: live from bloomberg world headquarters in new york, i am scarlet fu. joe: i am joe weisenthal. the question is, "what did you miss?" scarlet: senate democrats stall in the vote for republican senator jeff sessions as attorney general. the president fired the acting attorney general to for refusing to enforce his executive order. the bitter fight could sour debate over trump us is nomination for the supreme court later tonight. forget the world passes most valuable company, apple, posts first-quarter -- fourth-quarter results. everything you need to know in the numbers do not lie.
let's look at where the major averages stand as we head toward the close. abigail doolittle is standing by. abigail: stocks are sliding into the close and the dow right now is on pace for its worst klein since october 11. the dow on pace for the worst two-day decline since the beginning of september. earlier, the dow transports had been on pace for the worst two-day slide since the brexit. we are looking at a brief and bearish streak here and the question is whether it will extend. it is important to look at other asset classes to answer the question and it will be interesting to watch what is ahead this week. working, thector cyber security space, a lot of green here and a lot of stocks trading sharply higher on the expectation that president donald trump would sign an executive order around cyber security. just moments ago, the white house said that is on hold. nonetheless, a lot of strength here.
a bloomberg intelligence analyst earlier said this should be positive for companies if the executive order around cyber security is went through. it would be around intellectual property and it is important considering there have been several high-profile breaches target to name a few more. it could suggest without details, the rumors are it could be very good for these companies in terms of companies having to add technology and that would be good for the revenue of the companies. a broad platform company of next-generation. this could also be good for some i.t. consulting company said in .articular, he named ipm the stocks are actually down. a big drag on the dow today. that is one idea that was outlined. it is interesting to ask what is ahead for technology. g #btv five --at i do not know if it is possible
for you to pull it up? hold on, it is coming. abigail: the chart we will take a look at is the s&p 500 information-technology space. it is a one-year chart and we see it as well above the average, or the orange da line,sh 10% above the moving average. we see our side recently hit 70. is moving down. the last few times that happened, at least one time we saw a pullback. the last time it happened, we still had consolidated trades. it will be interesting to see whether or not we had that trading ahead. or some sort of a bearish streak. a lot of watching to do in the future as far as these sectors and the market, joe and scarlet. yet another busy day in washington. democrats sought to delay
confirmations by skipping schedules of those on treasury and health secretary. a new push to block the attorney general nominee jeff sessions. let's get to bloomberg's chief washington correspondent on capitol hill. thank you for joining us. what is the next step, democrats employing a tactic to stall nominations, where does it go from here? >> the republican from utah and the chairman of the senate finance committee was blindsided earlier today when all of the democrats on the senate finance meetinge boycotted the in order to approve the nomination of steven mnuchin, president trump's treasury secretary nominee. this has led to a procedural hurdle and stalled his nomination. it comes on the heels as democrats have done this repeatedly now, claims of obstructionism from the republican colleagues. i interviewed senator patrick
leahy earlier today and asked him to respond to the criticism that they are being labeled obstructionists. let's listen to what he had to say. leahy: this is the same senator who single-handedly 70 ofd something like president clinton's's. it is the same party that dozens of president obama's judges, including a supreme court justice. pass the giggle test when they speak of obstructionism. >> a lot of finger-pointing here on capitol hill, again, on the back shadow of the executive orders coming from the white house. in just a few hours before president trump is expected to announce his supreme court pick. a bitically saying it is disingenuous to make that comment about being
obstructionists. how united are the democrats? are there any >> and the acks in the-- any cr foundation? >> no. the messaging strategy coming out of the white house. i have spoken with several top aides to several top lawmakers on the republican side here on capitol hill. they have expressed frustration that there has not been a concerted effort coming from the white house on issues pertaining to these executive orders on the temporary travel plan -- travel ban or the messaging surrounding the supreme court pick it we heard from white house press secretary sean spicer. that to be making the case now they have gotten their act together but increasingly concerned here around -- among republicans that the white house is utilizing too much political capital and that could hurt issues like tax reform and even , allffordable care act political capital republicans will need heading into the next few weeks.
joe: how much is the unwillingness of democrats to do anything to get these nominees over the line a function of the activism we are seeing on the left, people out on the street come out in marches, the party being driven by the activist here? >> i think that is a huge reason for why you are seeing a lot of the strategies and tactics that are being deployed coming from democrats. i spoke with senator bob casey in the hallway earlier, a democrat from pennsylvania. what he essentially said is this is being driven by the grassroots community. sites in 2018, most behind a driving force the senate finance committee's boycott earlier today. he said essentially this is all coming from the bottom up.
scarlet: apple is setscarlet: to report earnings after the u.s. closing bell today. it is all about the iphone. in its last fiscal year, apple had its first annual sales declined since 2001 because of waning demand for a smart phone. let's focus in on apple in today's "the numbers don't buy." apples has posted three straight
quarters of decline in sales. upre will be revenue growth to percent in the first quarter. analysts will be focused on iphone unit sales which have been declining compared to previous quarters. estimates put that number at more than 76 million. it is not just unit sales that were grab everyone's's attention. the average selling price is a hasnumber expected, that been falling and expected to be about $688 for the first quarter. a bit of an uptick. all of this plays into the idea that everyone is looking at how apple's iphone makes up the bulk of its revenue. 60% of its revenue. the iphone numbers of course could get a booth -- a goose later this year. at the -- apple is set to unveil its cap anniversary edition that some are calling the apple iphone x. tim cook has highlighted the .usiness going pretty steadily
certainly, that will be a critical component of the outlook. the search for any kind of growth in the face of headwinds is growing more urgent. any update on that issue will be of huge interest to investors as well as commentary related to the u.s. or the eu. we will follow the earnings after we crossed the opening bell. we have got full coverage. joe: since president trump took office, he has made it clear he plans to follow through on campaign pledges including following -- finding a way to make mexico pay for a border wall. mexico is adamant that will not happen. bloomberg markets spoke with the of mexico -- former ambassador of mexico. was asked where relations stand between the u.s. and mexico. antonio: i think after a year of campaign rhetoric, much of it -- at mexico and mexicans as rapists and
criminals, there was hope there would be a combing -- calming period. certainly that would accompany any administration, but i think last week, again, it peaked in a way. first, the sense of mexico going to the united states to begin discussions of what nafta might look like going forward, and president trump tweeting the meeting should be canceled if mexico did not intend to pay for the wall. i think the call was probably helpful. seen isg you have mexico move from a level of anxiety about what might come with therustration messages coming out of washington and the anchor and i think more resolve, more resolute in terms of going forward and how they will negotiate and what the expectations are dealing with a trump administration.
>> there has been so much conversation especially among trip -- president trump supporters and regard -- and negotiating. is there a similar conversation happening on the other side of the border? are there people in mesko who think the deal needs to be reworked? amb. garza: if you look at any agreement in place for 20 years, the dramatic changes in the global marketplace, there are areas where it could be improved. in thee concerns are united states and mexico are with whipping up nafta, -- ripping up nafta. that is not aimed at making it a better and more efficient agreement that can address the current workplace. it is simply moving toward a more protectionist, isolationist view in the united states and that is troubling. there is a sense in mexico that renegotiation was limited to
those areas not meeting legislative or congressional approval, rose of origin, trying to modernize it in much the way ttp addressed certain aspects of trades, that would be healthy, but the notion of ripping it up and moving completely away from nafta, it is not something that is welcome here in mexico and in the united states. ,oe: that was antonio garza former u.s. ambassador to mexico. , the borderhe theme continues to grow when it comes to nafta. trump us his pledge to rewrite the trade does not go far enough for them and they say it should be scrapped entirely. for more, let's bring in isabela from mexico city. thank you. you wrote a fascinating piece. u.s. think in the about this in a one directional way. there are mexicans who actually
feel similar and inclined to rip up the agreement with the u.s. as well. that is right or do we wanted to get a sense of how people in the street felt about nafta and we wanted to take it outside of the online conversation which can be one-sided at times. what i found in the streets of areco city is that people fed up with the whole situation and actually would not mind if nafta was scrapped entirely to a lot of people actually mentioned to me investments that come from other countries. it comes from asia. the sense is this could finally to stopping independent from the united states and start a new. scarlet: the reality is mexico depends so heavily on the u.s. you t-rex trade flows and can see in terms of total trade,
$500 billion it worth of total trade in 2015. china is the next biggest partner, $87 billion. the u.s. is 5 billion times important. klesko one. in terms of the math, it seems to cut ties like that. >> yes. over 80% of mexican services and goods go to the united states. we are basically intertwined like never before. changing that would be very difficult to heard from analysts we need to get a point by point mention or changes in the negotiations that will happen because it is very dicey and we do not really know what this would look like and it is difficult to diversify your trade-in your economy overnight. this is the sense we are getting
from mexicans paired frustration and a lot of worry. they are also very fed up with this. frustratedt up and with president trump because of his anti-mexico rhetoric. they are also fed up with their own president. who are they supporting? is someone waiting in the wings looking to jump in opportunistically here? >> this is very interesting. the trade and twitter war between the two president is coming at a time when approval ratings for the president are at their lowest. there was a hike in gasoline prices last month which raised prices about 20%. that has made them highly unpopular. a candidate, always the same in mesko from the more fromst party -- in mexico the more leftist party, but so far, not very loud. analysts point to the
possibility he could possibly benefit from this. as of today, we have not seen that. it has not been palpable yet. joe: in general, the tone, even if no one is able to consolidate the populists behind them, people you talk to in your is ale sense that there more unified mexico, even if there is no particular politician for them. what does that mean politically? do you sense there is a ride -- rise of national pride in mexico in response to what is happening with the border? >> there is no doubt there is a wave of nationalism since late last week. one of the people i spoke to on showed me the ribbon and pen he was holding and it says mexico is united, please buy mexican goods. there is not a very organized movement so far, trying to boycott perhaps american products per se. but there is definitely a
tomotion by and for mexicans choose mexican products over products coming in from the united states. this is a nationalistic moment that politicians across the country could profit from. and howt to see who that will be done but this is definitely a moment of unity for mexico. scarlet: all right, thank you. next, 10 years after the start of the financial crisis, have european companies reduce unemployment? this is bloomberg. ♪
the top line shows intraday volume has continued to rise. the green line here at the terms is your average in of how much volume you usually see on a daily basis. this pointing forecast is part of it but under armour is the most shorted stock on the s&p 500. mid-january, people were betting against the stock by borrowing shares to sell it in hopes of buying it back later had a cheaper price. the surgeon volume could certainly be people selling the stock but also perhaps coding their shores, 28 of the open, it has come off a little bit, tearing its losses just a bit as it continued. joe: i am looking at a problem for mario draghi at the ecb. employment data out of eurozone
countries today. let's look at the direction italy and germany are going in. up against the unemployment rate, the average, 12%. on the other hand, the red line, the unemployment rate in germany is down to 5.9%, the lowest level since the crisis. this down here is the spread between them, a nearly 6% gap. think mario draghi's challenge, he has to find an appropriate policy that is good for -- ideal for germany and italy, going into separate directions with different economies, it makes it really tough. scarlet: absolutely. talk about dividing europe into north and south. all right. the the data overall for eurozone looks ok, the devil is in the details. the market closes next. take a look at major indexes. the dow is extending its climb
the president unconventional policy approach continues to unnerve markets. i am scarlet fu. joe: i am joe weisenthal. if you are tuning in life on twitter, we want to welcome you like to the closing bell coverage every day from 4:00 to 5:00 eastern. scarlet: we begin with the market minutes. -- 500 falling for the another day, the longest streak. joe: we were down way lower than this earlier in the day. kind of like yesterday, coming to the lows. scarlet: we did follow euros lower as well.
to look at industrials. it is the worst performing sector in the s&p 500. ups, down by 7%. a stronger dollar, as well as a shift to morgan toomer delivery -- more consumer delivery. united airlines, as well as others, still feeling of weakness after the trouble. -- the travel ban. steel company, earnings beat estimates. teva, they are down 3%. it lost on the multiple sclerosis drug. joe: let's start with u.s. bond yields. down today. equity market generally a raise
their losses. of mediocre kind data that came in weaker than expected. check out greece. two-year yields continued to surge. it pulled back a little bit. you can see the bike there. you can also see from the one your chart, it has then higher, as recently as the summer. keep an eye on that. tostanding issues on whether a lot more bailout money for greece. scarlet: a currencies, the top administration is back at it, talking down the dollar, criticizing germany and japan for having currencies to week -- weak. another way of saying the dollar is too strong. it is now back to the lowest since november 11. peter navarro, the head of trumps national trade council,
called the euro undervalued. look at that. the euro is stronger thereby 9/10 of 1%. that would be direction -- reaction. he cannot do more than that. joe: it seems unlikely they a currencyeurope manipulator. let's look at come ideas copper, a good day. silver rallying 2.5%. gold having a nice day. earlier, a headline said, gold rallies after trump shocks the market by doing exactly what he said he would do. it is exactly what he said he would do. scarlet: investors were taken this idea that you had to take donald trump not literally, but since the -- seriously.
it would seem that he is following through literally on many of his policies. those are today's market minutes. .oe: don't forget, apple the world's most valuable company and maker of the iphone will report first-quarter earnings in half an hour. we will bring you all of the headlines. scarlet: in the meantime, we want to take a dive into the bloomberg. you can find the tides by using the function at the bottom of the -- find the chart by using the function at the bottom of the screen. we know the trump administration will overhaul the hb one visa, possibly through an executive order. indian i.t. companies are huge users of this visa. they displace higher cost u.s. workers. trump wants to double the minimum wage of these workers.
that means potentially less business. let's face it, they depend on the u.s. for 60% of their business. the indian media, the headlines are all on this. joe: every day, another sector of the market taking a dive on something trump related. i want to go into the bloomberg and look at all the different ways to measure wages. it is important to note, the blue line is the rodent waste -- to weait tractor. , the cost index. they're generally trending up, but not all the same. it is important to remember that no one data point can give you the answer. you want to look at the broad trend to find what is confirming what.
it will be interesting to the if the average earnings the, on friday continued to show straight. scarlet: this is hard data. is any particular metric more reliable than another? joe: that is a good question. people like the dei because it includes benefits. the each have their strengths and weaknesses. what did you miss? it is a busy week for central-banks. today, the boj kept things unchanged, as expected. tomorrow, we hear from janet yellen. thursday, the bank of england releases its decision. i want to bring in an international affairs specialist . he also served as a member of economic policy.
thank you for joining us. there is a lot of excitement right now that central banks can begin the handoff prices. -- process. maybe now we will get some stimulus, some inflation. you see that as correct? do you see the world central banks staying generally close to zero? most centralat banks are still very close to zero, except the united states, which they tried to hike the , maybe three times this year. there is a descriptive the -- discrepancy between the u.s. boe,ary policy and boj, and the ecb. scarlet: we are not right there yet with normalization.
central banks are no longer the only game in town. central banks are now in wait and see mode, waiting for different administrations to not policy. enact policy. >> the things are looking what is next for the trump administration. fiscal stimulus, text cut, that -- tax cut, that is ok. ,robably higher inflation rates achieving a 2% inflation rate faster. welcome bysible and the central bank. in japan.., and also for japan that means the u.s.
dollar will appreciate. that is good for japanese and probably for european company -- countries. joe: in theory, if we got some fiscal stimulus, the bank could model it, figure out the impact, and do rates in accordance with that, but part of the issue right now is it is very hard to understand the single. people are scratching their heads, what is really going to come? how does the central bank or deal with the fact that fiscal policy -- >> the risk is that fiscal ,olicy does more than is needed then the inflation rate going up faster than normalization. central-bank have to respond, hiking interest rates faster. that will be very disruptive and may cause something in the recovery process. scarlet: do you think the u.s.
is at risk of that? >> we do not know how much is coming. scarlet: inflation is near the target, and we're talking about perhaps a trillion dollars in infrastructure investment. >> infrastructure investment, we don't know how much of coming, and whether congress will approve it. there is a lot of risk and uncertainties there. i think that central banks are watching very carefully. joe: let's talk about japan, the bank of japan. is the bank of japan achieving its goals? how is the current monetary stance working, in your view? >> monetary stance is working well. the growth rate is about 1%, which is good for japan. the unemployment rate is down to 3%, which is the lowest since the bubble year. , although it rate
is very low, but has some uptick. i think the bank of japan is comfortably waiting that the recovery process will continue. scarlet: what is the likely -- likelihood that the head of the boj is asked to stay on? speculate.o early to i think he is doing well. that he willance ask him to stay on. joe: your name has come up as a possible future head of the bank of japan. is that a position to you would be willing to take? >> i do not answer the hypothetical. torlet: if you would ask you advise him now. or, if we would ask him how to deal with an unpredictable u.s. president that has no qualms
about calling out countries for keeping their currencies weak, how would you advise him, h what would you say? >> you mentioned the overall intervention from president trump. i think you have to deal with it and try to talk to present trump -- president trump. joe: in general, how much are you worried about a rise in policies where everybody is trying to weaken their currencies, and where more leaders take a zero-sum view of trade? >> i think the best defense that the bank can take against contouring those interventions from washington is japan has not intervened in the market. it is a monetary policy that .esponse to this inflation rate
. that was left vacant when antonin scalia died last year. the two finalists were summoned to washington prior to this event. what are people talking about that? of any timeaware comparable to this when a president has asked the two finalists, or summoned them, as you say, to the the -- d.c. the president is clearly trying to create some buzz as to what he will do. we will have to wait and see. i'm told it is one of these people but we do not have a firm indication as to who it is. joe: do you think the one who is going to be selected is aware or are they both still in the dark, as far as you know? >> it is not 100% clear. there are some indications that campeast one count --
believes their person will be the nominee, but it is not clear enough that i can go much farther than that. scarlet: what is the strategy on the democrats side? the are boycotting nomination vote. how hard would they rally to oppose the nomination? >> that remains unclear as well. democrats are really holding the cards close to the vest. chuck schumer has been saying, "out of the mainstream." today if the nominees are out of the mainstream, and he did not answer. joe: does the base of the republican party have a preference between these two? >> not between those two. to, ordy i have talked
the bulk of the people that i talked to, are happy with anyone on the short list. they are all going to be conservative, pretty similar to antonin scalia a, and you can expect republican groups and conservatives to come out in support of this nominee. scarlet: whichever candidate it will be, what kind of questions can we anticipate at the confirmation hearing? >> you can expect the usual a confirmation hearing. people will want to know what the nominee thinks about roe v gay marriagemer -- ruling. what happened over the weekend with donald trump's travel ban has raised new questions. that will play into some degree.
perhapss and republicans will want to know if the nominee is someone who will stand up, if it turns out the donald trump does something clearly unconstitutional. members of the supreme court will want to know -- of the senate will want to know the justice is not afraid to say that to the man who nominated them. joe: barack obama nominated mary garland -- mary garland -- merrit garland. how are the politics looking? if the white house confident it will be able to be a filibuster -- beat a filibuster? >> the white house is confident. the senate majority leader is confident also.
a nuclear option would essentially killed the filibuster. you are right. democrats are filling the pressure from the liberal interest groups. everybody is playing along game -- a long game here. the question for the democrats is are you going to filibuster now or wait? courtloomberg supreme reporter. we will be covering the announcement lies here on bloomberg tv. coming up, apple's first quarter earnings are expected to be released in 10 minutes. this is bloomberg.
the it is time for bloomberg business flash. a look at some of the biggest of the stories in the news right now. s -- some of the ations being weighed include sell off. the valuation could be affected by pricing pressure in the industry. of bridgewater associates says he is becoming more concerned about the damaging effects of president policy.populist he says it may overweight his
pro-business agenda. major oil companies are still struggling through the biggest srkets long -- market lump. for exxon, it was the night -- n inth street corner that incomes decline. something are said to be .onsidering new house in the eu ireland is considering while citigroup is eyeing frankfurt. i'd u.k. lobby group says that as many as 35,000 jobs could be relocated out of the u.k. that is the bloomberg business flash. scarlet: apple said to report fiscal first-quarter resort -- results in about five minutes.
we want to take a dive into the bloomberg. let's start with apples different revenue streams. at the end of the day, apple is just a phone company in that it depends on the iphone for about 2% of its revenue. tim cook recognizes the need to build up other businesses. it looks boring compared to growingroup, but it is at a steady clip of about 25%. the prospects for apple hinge on a bigger push services. itunes and icloud have not gotten the company where it needs to be. absolutely. apple, i believe, they have expressed frustration that they do not get credit for their service businesses like other
companies do. it will be interesting to see the extent to which that is really going to be bottom line. scarlet: the recurring revenue growth. love it. appleet's talk about stock and how the company has done in previous earnings. if we come over here, and i will highlight this number. 4.87%. that is what it has usually done in recent earnings. whether up or down, often the stock moves at about 4.8% after earnings. you can the, it is not consistent. 2.25%, the last one, it dropped. you can see, this one likes to swing around. no particular consistent pattern after earnings in terms of whether it gained or moved.
the percent the price column, all green there, except for the second quarter, where he saw a drop of almost 5%. apple always lowballs when it comes to the forecast, and then it needs it -- beats it. it when youo beat have a conservative number. coming up next, apple acted to report fiscal first-quarter results. of course, it is the world's most valuable company. the supply chain is enormous. it has repercussions in asia and europe. this is bloomberg. ♪
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scarlet: we are waiting. apple's earnings due out any minute. they have just passed the world's most valuable company revenue. 53.5 billion. true to form, apple lowballing the outlook. for $3.20re looking on a gap basis. higher than what analysts expected. is what was anticipated. the 78.4 is an increase from one year ago.
you can see the stock there in the after hours session. 2.7%., of 2.7% -- up the revenue is what we are looking at here. joe: so far, the number looks pretty good. the stock now of 2.5% in after-hours. all of the data looks solid. you see the numbers versus estimates. sold, alwaysits important. on the service revenue, the cfo saying they expected to double in coming years. scarlet: let's get some instant analysis here on the apple result. we have david kirkpatrick and
john butler. john, as we are giving the numbers, you were checking your work as well. -- your bloomberg as well. on the iphone matter when we are concerned about the next generation of the iphone? >> i thought it was a pretty good quarter on the service -- surface. the iphone units look good to me. what they were really hoping for was coming off of negative iphone growth. 78.3 million unit shipments. that should be a positive number of year on year. i think that was an important milestone for them. scarlet: 75 million, the same time last year. >> if there was a concern coming into the quarter, i think people were really sweating reports that the iphone seven was not selling well. obviously not true with these numbers.
joe: we have this quote from tim .ook "we sold more iphones than ever ." what do you think? >> the iphone 7 is a very cool device. establishms that they 10 years ago, they are performing very well. they can continue to milk and old product concepts. the question i have is where they go with new product, new ideas, and why have we not seeing them come up with any that really matter? scarlet: is that holding back the sales of other products? the ipad, the apple watch? >> probably not. i think the real question is how come amazon came up with the echo, and apple didn't. joe: by the way, if you have a bloomberg, check out to you live
-- tlive. declinedducts year-over-year. what is the issue there? why have they let amazon take the early lead? isi think the biggest issue where is the vision. we brought that up a moment ago. classic product transition. there is nothing to come up with the slack. know the answer lies in hardware. they need to look at content and other services beyond just apple pay, for example. you need someone there who needs to think out of the box. that is the issue now.
the product transition. scarlet: we are also looking at the breakdown geographically. there was 20% year-over-year growth in japan. 9% growth in the u.s. greater china. do consumers in china care about other services, the other products, or are they only looking at the iphone and thinking, i'm not getting what i promised? i think their challenge to deliver the products in china given the control that the government exercises over digital businesses. i would agree with john, what is interesting about amazon and the echo is it is a set of services platform.orm -- and a
apple has not made the transition of the way they should have. yes, they have a lot of clouds everything but they do not have the kind of visionary executions of your seeing at amazon. i would have to say, it is disappointing that johnny isakson did not carry the ball after steve jobs died. joe: what of the notes on apple -- of course, it is an incredible success story, so there are not many -- they are not in internet company. never the online service the way that google, facebook, amazon have mastered. >> a big piece of that is they do not understand social. have often abandoned it. none of their products are typically that social. snapchat,thing like facebook, or twitter inside the
apple product that. t. se on the other hand, no one has executed as good as them. they still have the world's most sex the tech product -- sexy ch product. is there a groundswell of maybe concern that tim cook is not the person you want in this phase of apple's growth? at what they're doing, it raises a lot of questions. ai is just one area where we talked about where they left lacking. again, they are at a point where what is really needed is vision. they are a very secretive company. we are led to believe that the brain behind the ai work at apple is very -- buried.
i'm not so sure on that. we're not seeing the fruits of their labor, that's for sure. joe: the ever selling price of the iphone is perhaps the indication that they are selling more of the iphone of them plus -- seven plus. i came across an old ifo the other day, and it seemed tiny compared to my six plus. >> smartphones are getting bigger, but i think they are pushing the envelope in terms of how big you can get before having a tablet. if you look at how well the se day, i think there is a market for both. , butnot know the exact mix the mix between the iphone seven plus and the iphone is probably pretty balanced. joe: here is my other -- scarlet: here is my other question. beuld analysts and investors
better at reading what apple does? every quarter, they lowball. you would think that people would know how to read this company better. >> when you're talking about a business of this scale, so deeply intertwined with global activity, i do not think it is that easy to do. i do not fault the analysts there. i just want to say, i love my iphone event. i have qualms about certain things it does. the question i have is how much carry will be have to around a rectangle of glass that is fundamentally an inconvenient device. it is not the device of the future. yes, it is a really good implementation of an old device. i think the iphone 7 what a step forward of considerable quality. the camera is nice. it is wrong to think that the future of computing is squared of glass in our hands.
that is what he kept reconfirming. they were amazed that the skew moved towards the iphone 7 plus. this is what drove the beat in terms of revenue and profitability. climbing. the beat seemed to be the shift towards the jeweled camera. it was the most popular model. you mentioned about other products and the fact that that fall -- fell. that is what my colleague asked about. ipods, moving down. apple tv, a new product launched this time last year. a very tough comparison. key for thes is a business. it was to grow the business. what did the cfo's day about the future of the services?
>> very bullish. basis, if youe take the services, it is as big as a fortune 100 company now. they say it is crucial. they say they will double that in the next four years. at growing at a record pace. there are bullish on the services side. services is starting to pick up. scarlet: explained that ms. on the second quarter forecast. it did seem to be a miss last quarter. >> it is about 4% off.
fx.reason, a big specific reason. range is good. a check this out. $1.25 billion is what was knocked off because of the strength of the dollar. it was a big headwind. the last message. you talk about china and the emerging markets. china was not brought up on the call. iny say significant growth countries like brazil and turkey were important for growth. joe: you will stay with us. we still have david compactor. what are you seeing? the services the is huge. and present that it is such a gigantic business. let's face it.
even when you use some of their processing products, their clout services, there will be ways that they can charge or for that going forward. i worry that it does not feel fundamentally new the way they are handling that. frankly, i don't think communication to customers is that clear as to how big that opportunity is from a user point of view. on the other hand, you have to give them credit. one of the headlines and looked at at the break, "monster earnings report here go -- report." let's face it, the global economic environment is very tough. scarlet: yet, the company feels ofy conservative in terms expanding to new businesses. it was reported they were looking into a car project, and they cut back on that effort. these were supposed to be the innovative and visionary nextel
steps the company was supposed to do. >> i think apple will still have a major automotive product. it may not be an apple branded car, but i bet they start making more money through software in vehicles. they have done a good job working with carmakers on that already. that is a big opportunity. joe: caroline, is this a trend across the tech companies in silicon valley? thinking about google cutting back on some of the wild and .razy project x type things if they're not making money, there's limited patience as to how much money they are willing to throw at them. >> indeed. at trying to take control of the spending there.
it is interesting, i do not think it is the tech giants, it ups.e start of -- start yourself,l be proving you don't have to always be splashing your money. shows the rmb is still going in the right direction. joe: thank you very much. caroline hyde and david kirkpatrick. up, how coming potential deregulation for the trump administration could change the nature of real estate. we will hear from a real estate management director next week this is over. ♪
president election of trump, the consensus was the globe was stuck in a low growth pattern. it set the tone for a panel that i posted last week. ost last week. ein this part of the conversation, i asked about donald trump ground in real estate, and what the world might look like from that perspective. towards, if there is economic policies, there are some things that he does know and others that he does not. far withinion so taxes, do we draw -- we drop them, to be adjust appreciation, do we limit the
interest of action, a lot of those things could be a little scary, in terms of if they are pushing out two standard deviations. some of those were in place .rior to the s&l crisis from that perspective, we get a little scary in terms of the economic policy. we are in the business of supply and demand. supply is excess, it will push down real estate. we look at the u.s. and think there will be slightly beneficial policies, net neutral to real estate. taxes coming down is always a good thing. ofmight change the nature
real estate to make core plus effective. lot more if there are buyers of higher leverage looking at interest reductions to make the interest work, you may have a shift down from that perspective. the recovery cost system, if that comes into play, that could push more development. yet.ve not seen that let's wait and see if it goes through congress. they really have not shifted too much. everybody is looking at the u.s., where we are going, what we are doing. if we look at the cycles, we are probably two years of head -- ahead of where europe is and probably a year ahead of asia in
terms of the economic policy. time.e unfortunate, there is no tech technology. of looking luxury out over the long-term, and doing research, and watching the supply side. the economic policy is important , but we do not see the growth .et out of europe it is still nascent, in terms of what is happening over there. we do not the economic policy shifting. muted a relatively environment there, and over in asia. onare in the slow and steady the real estate site.
breakingwe have some news. netronichc -- preparing to sell part or all of the medical supplies business. this is still at a very early stage right now. it could be valued as high as $5 billion. medtronic declined to comment to us. joe: and, we want to bring you an update on where apple is trading. up 2.5%. let's wrap up some of the data points. beating expectations. .iphone record revenue
president trump it acted to announce his nominee to the supreme court tonight. bloomberg will have live coverage. both finalists have been summoned to washington. giving theresa may authority to trigger brexit. finally, facebook earnings reported after the bell tomorrow. should be very exciting. did yous it for what miss. this is bloo
support her nomination. a senate panel voted for linda mcmahon to lead the small business administration. both nominations move to the full senate for consideration. meanwhile, the senate confirmed elaine chao is secretary of ofnsportation by a vote 93-6. she could race morning tonight by vice president mike pence. regrets used in obscure rule to delay the vote on attorney general nominee jeff sessions. counters gave lengthy speeches opposing sessions for several hours until the pro was delayed until tomorrow. democrats went to boycott it both for steve mnuchin and candidates would be approved, orrin hatch said. an online petition opposing trump's to visit has drawn almost 2 million signatures