>> from bloomberg headquarters in new york, this is matt miller in for mark crumpton. this is "bloomberg online." today, tsa expands mobile device checks to domestic flights. then a look at the sun valley conference. ."o's "game of thrones dominated the emmy nominations. two viewers in the united states and those of you joining us from the world, welcome. we have full coverage of the stocks and stories nicking headlines around the globe today. peter cook and highlights from his interview with rob portman. phil mattingly has a bloomberg exclusive -- president obama's

expensive year of executive actions. but we begin with the tsa looking to expand mobile device checks on u.s. domestic flights. what are we talking about here? >> what we are talking about here started on sunday when the department of homeland security issued a new directive announcing new rules requiring u.s. bound passengers from europe, africa and the middle east to go through security and turn on their phones in front of security officers proving, presumably, that they are in fact real and not disguised explosives. now bloomberg is reporting that rule is being expanded to apply to u.s. domestic passengers flying within the united states according to people familiar with the matter. the rule is not officially at and i spoke to a couple of tsa officers here who had not heard of it. what we are being told by

bloomberg sources is this would be limited to certain passengers and would be used more sparingly than overseas. >> what prompted this? have we had issues with people using fake mobile devices? >> that is the big question. we don't know the reason. specificas not named a point for announcing that directive. we do know that authorities have been on heightened alert from terrorist activities from al qaeda groups in yemen and syria. questions do come up now, what is this about -- the homeland security secretary, jeh johnson, speaking on "meet the press" says that he hinted rules like this would be coming out but asked we not over speculate. sometimes they ratchet up the rules and sometimes they ratchet them down. this week, we see they're making things tighter at airport

security. >> thank you for talking to us about that. i guess we will experience that if we fly into the us with a mobile device. now a bloomberg exclusive -- republicans have taken issue with president obama's decision actions thistive year going as far to threaten him with a lawsuit he on what the senate pseudonym for and one in the supreme court. numberspublicans have to back up concerns about executive actions and phil mattingly has more on this. >> republicans are working on a number of different levels trying to counter what the white house is used to route this year to basically get around congressional gridlock. what we have from one republican aligned policy shop as they have gone through what every executive branch agency has done the rulemaking side of this thing this year and a pulled estimates of costs. the total is $104 billion.

why does that number matter? as biggest thing is republicans look for ways to push back against what the administration has done, hard data is valuable. it's valuable for floor speeches. what they are trying to do is underscore the fact that with these regulations come to cost and the cost is being driven by the obama administration. that is one is a try to rally their base that they feel like they can head on going forward. house push with the on the lawsuit, trying to push back against executive action and do something john boehner hinted at again today at a press conference. >> every president does executive orders. most do them within the law. what we are talking about our laces were the president is real writing -- rewriting the law to make it at his own needs. that put these

together actually broke them down agency by agency and you see from the top, big numbers. the energy department, more than $50 billion. the epa and the treasury department -- responsible for the volcker rule -- more than $4 billion. were republicans emboldened by the supreme court decision to overturn the president's recess appointment authority? >> without question. i think it was perfect timing from a messaging perspective. it was shortly after john boehner circulated the memo saying they were going to work to see the president. things -- are they directly connected to one another? no, but they fit together in a narrative republicans like and think is true and accurate going into november. to see you are going them hit on it over and over again. >> is this the kind of thing that all residents seem to do at

the end of their second term, go crazy with pardons and executive powers? or is this the kind of thing the white house takes seriously and would consider curtailing their behavior on? >> i don't think the white house is thinking about curtailing their power. i think they feel like they are on solid legal ground and they are thrilled republicans want to have this fight over action versus inaction. what you see throughout history as the president has the ability to take executive action. he's going to check with his counsel and the justice department. if he feels like he's on solid legal ground, he's going to go for it. they single appearance president is making, he's hammering home the fact they are threatening a lawsuit and that he's working unilaterally. they love this issue and they're going to keep pushing it regardless of what republicans do. but thank you for that. the president can't do everything on his own. he's asking congress for nearly $4 billion to deal with the flood of young immigrants trying

to get into the country. peter cook spoke with republican senator rob portman and they talked about the immigration issue as well as his issue -- his interest in running for resident. portman says he is still reviewing the president's request. faxed my concern about it as i don't know that it comes with the plan. the president has yet to give a sayingational address this should not continue, to send the message loud and clear to parents in countries like guatemala and el salvador, countries sending these kids, many unaccompanied, to the united states and our policy is not to accept these kids as citizens and in the misunderstanding is they could bring their families up. we do have an immigration system in this country and it will be for enforced. -- it will be enforced. flow into stem the

addition to dealing with the aftermath of a failed policy. >> the president is making the case as he did in texas, that this makes the argument for comprehensive immigration reform. you did not support it last year. why is he wrong and why isn't this the right example for forgiveness? >> there's nothing in the immigration policy that he supported that would have kept this from happening. more would have provided guards along the border. >> and they would have accepted these kids just as they accepted the ones that came in this time. it's not like they snuck through the desert. they were excepted because of a lack of enforcement and policy. know, the system is broken and should be fixed. i think it's got to include enforcement. fornother big issue congress to deal with this what to do about the export-import bank.

it sounds like a lot of house republicans have no interest. >> they basically say we will help you compete in the global economy. all of our major competitors around the world have their own programs to help with financing. board all of them have a generous program than we do. they will say i can't compete company has ather financing mechanism it's more effective than ours. i'd like to see some reforms in the xm bank proposals will stop i like to see the united states be much more aggressive telling countries in the world let's reduce the subsidies on exports, which is something i've thought for what i was u.s. trade representative kirk. let's not shoot ourselves in the foot. it hurts the workers in ohio and around the country. >> do you think you get done this year? >> i think it probably does in the senate, but i don't know about the house. it would be too bad if we're were to tell u.s. workers were

not going to help you to be able to keep your job, not just keep your pay but increase your pay and benefits which we ought to be having in this country. right now, we're seeing a reduction because we are not creating the environment for for companieson to survive in the marketplace. dooru seem to open the more than a little way for running for president in 2016. >> i'm planning to run for reelection in ohio. there are a lot of issues right now i feel passionately about. i think our economy is in trouble. i know our fiscal situation is not sustainable. we are on the wrong track as far as these fiscal issues. i want to continue the fight and i plan to do that, assuming i win my election in 2016. i'm going to look at the

presidential field and if there are not republicans talking about the need to rot and appeal to our party and be more inclusive, i might even change that but right now i'm planning to run for senate in ohio. >> peter, what sort of reception would the gop give portman as a presidential it? >> this is someone who is really respected in the party. he's been a u.s. trade representative and a budget director. he's sort of the consummate establishment republican candidate and to some extent that's a plus but is also a liability in this environment. he is not a bomb throwing conservative. he's not that flashy and is a supporter of gay marriage. that puts him at odds with some republicans out there. this is a guy with a lot of ties to the business community. hard to think rob portman would not be taken very

seriously should he choose to run. the question is does he jump into the ring? that depends on who else decides to run. it is a huge swing state politically. concerned,oards is we were simultaneously hard rogan and disgusted by lebron betrayal and moving to miami. what does portman have to say about him coming back? >> i said he may help bring the republican national convention -- could he bring lebron james back to cleveland? he's not using his political influence, but he is certainly a supporter. to see itn would love happen. >> a lot of people had just forgotten what happened before. topic andn is the louise iteris is one of al

hunt's guests on "political up, a globaling economic perspective. while europe is floundering in china's growth slows, the u.s. economy is steadily rising. we will look at what's driving growth in the u.s. ♪

>> the u.s. economy is in its sixth year of expansion. the latest bloomberg surveys looking at 3.16% growth pace for the second half of the year. that would be the first time since 2004-2005 gdp had extended such gains will stop my guess is the senior trade professor at

cornell university and author of "the dollar trap." he joins me now from ithaca, new york. welcome back to "bottom line or cap let me ask you what you think about this u.s. economic recovery. a lot of people would say the job numbers we have been seeing don't tell the full story. on the other hand, we've added monthhan 200,000 jobs per for five or six months in a row. >> it's taken us a long time to get to where we are right now but right now, the u.s. economy is on the cusp of a much more durable recovery. when the crisis hit the u.s. economy, the u.s. put in a very aggressive set of policies to fix the financial system, move forward monitoring fiscal policies and we are beginning to see the payoff. the labor market took a long time to catch up. see general signs of strength.

rise inr concern is the consumer demand in particular was being born along by financial optimism getting ahead of the real economy. but now the real economy is catching up and we have better days to come. >> how much better? we hear warnings from christine lagarde from the imf telling washington how to run fiscal saying she thinks we will be running the lopez. should we heed those? -- running below pace. >> it's premature to start withdrawing fiscal and monetary stimulus. we have artie draw up -- withdrawn some because of budget discussions in congress. withdrawing monetary stimulus is premature at this stage. but early next year, we will see a normalization of the interest rate cycle and the economy can handle that. the big question is what happens in the rest of the world.

the u.s. economy is somewhat protected from what happens in the rest of the world. if you have trouble breaking out in europe, that would put more pressure on the u.s. economic recovery. >> let me ask you about europe. and portugalissue where the parent of the second-biggest bank there missed a payment, defaulted, call it what you will. is spooked the markets, but not that much. we still had a global collective sigh as far as gains are concerned. the eurozone stable? does mario draghi have everything under control there? >> if there's one part of the world economy that worries me in terms of its potential for creating risk around the world, it is europe. a lot of progress has been made there in terms of the school positions and putting in place structural reforms. recentuntries like portugal. but these reforms are not fully in place yet and the financial system is not fixed.

there is a lot there that could come home to roost if growth starts slowing down. even countries that have taken action the fiscal front like greece will be left with large levels of public debt. they are by no means competitive yet in that poses a real risk to the economy. fax will they have a longer new normal? we are finally emerging from that here. a multiple to take of time for europe to get out of theirs? >> europe has spent a lot of lyrical capital undertaking reforms and belt-tightening. but they started from a very difficult place and still have a fair amount of go -- fairmount to go. the hope is growth will pick up significantly. growth is beginning to bottom out, even in some of the weakest economies. donenk a lot more will be on the financial front in particular, but the more rock later market -- labor market still has quite a way to go. >> what if you look at japan?

upthese three pillars hold economically? >> we have finally seen it unleashed with the prime minister indicating a broad range of reforms to improve the economy's flexibility and competitiveness will stop the key thing is the political capital that will certainly be needed to push through and implement reforms. certainly now there's a good sense of optimism about japan because monetary policy is firing hard on all cylinders and is the policy is somewhat supportive. finally we see structural reforms being looked into place. >> thank you so much for joining us.ill stop -- for joining you come on, we will talk about your take on china. up next, we will get you on the markets with the aid from julie hyman and this live report. >> i'm jon erlichman at sun valley -- names like warren

buffett and sheryl sandberg here. the personk about who helped with the google driverless car issue and google glass. nice talking about education. that's coming up. ♪

>> puerto rico is looking for investors to solve a slow economy and staggering unemployment. stephanie ruhle shows us opportunities for growth and talks to the island's governor but he would -- how he will solve the massive debt problem. 9:30how airs tonight at eastern here on bloomberg. it is 26 minutes past the hour and a means bloomberg is on the markets. but let's take a look at stocks right now, coming off the lows

of the session with the selloff caused by concern about a possible default and portugal. not trading as low as we were earlier. the individual stocks we're watching, some of it is earnings related. family dollar is under pressure from carl icahn. they missed the forecast and the business review is still ongoing. openompany still lance to 525 new stores while opening 400. carl icahn would like for someone to step in and buy family dollar, but it's unclear who that would be. united continental holdings mother stock we are watching all stop shares climbing after announcing each seat flown a mile rose more than analysts estimated. the improvement in domestic routes was what southwest reported and airlines as a whole are on the rise today. american airlines also reported yesterday, talking about margins

that would be better than estimated. a good couple of days for the airlines. we will have or on the markets in 30 minutes. ♪

>> welcome back to bloomberg " online." i'm matt miller in for mark crumpton. the hunt for yield has made speculative grade loans quite popular. but if buyers ask for their money back all at once, it may not be so easy to get it. some analysts are saying they should watch out. lisa bromwich has been following the story and joins me now. let's start with the difference between junk loans and junk bonds. not a lot of people think about this. there are number of

professionals that work on it, but for the layman, what's the difference? >> they are not interchangeable. junk loans are not security. junk bonds are. when you trade a loan, the -- there are paper documents that lawyers, back-office staff have to sign off. it could take two to three weeks to complete the trade of a junk rated loan. bonds on the other hand are securities and you have to get your money back within three days. it is a pretty big stink chen even though they are both speculative grade that. >> but one is a security and one is an asset. init traditionally has not very liquid but is increasingly liquid. >> how big is the market if it's getting increasingly liquid. i'm guessing it's doing it bigger. >> there has been a run of money from investors. it swelled from about $750

billion in the u.s. market. that is more than switzerland's p annually. bondmparison, the junk market is about $1.3 trillion. so it's a comfortable size and there's been a rush of individuals and to mutual funds and exchange traded funds. they have been coming and partly because loans are paid to floating-rate benchmarks. there is a junk loan etf that is very popular. >> it makes it easier to trade and is more liquid than trading the underlying paper. >> but here is the problem -- it easier to trade the shares of the next rain -- and exchange traded fund. but if the underlying takes two or three weeks to transact, if you buy a loan -- >> it would be difficult for an etf manager to keep up with. >> herein lies the rubble. we are in a time where the cycle could be changing.

they are seeing the risk of people moving out of riskier debt. what happens if rates do rise in any kind of substantial way? >> i guess that is the main concern -- investors getting involved in something they don't understand and managers having difficulty dealing with investors like that. >> there is a fundamental mismatch year. you got shares of all funds and exchange traded funds that trade like stocks or securities will stop -- securities. >> it has been a mismatch in a lot of etf's for a long time. in this case, it is just amplified. 11, as spinalp to tap would say. how have the fund managers addressed it? fax they hold more cash, they hold more bonds rather than loans to have something to sell more easily.

and they also get credit lines. facilities they enter into his banks were they can borrow if they need to to meet redemptions while they wait for their money back. the problem is all of those things drag on performance. so the investor is kind of getting hurt by that just by virtue of the drag will stop if you are holding cash, you're not earning income on it. if you are holding bonds, you will actually divert from the index. >> caveat emptor. thank you for joining us. it terribly interesting subject. you make something that sounds boring at earth area interesting, i think will stop kudos to you for that. coming up, media dealmaking in silicon valley. that the thing that sounds interesting and it is. we will tell you what is in the works for some of the biggest names in the industry. ♪

>> it's time for today's latin america report. argentina's economy minister will meet tomorrow with a court appointed a mediator as the country tries to solve the conflict over a default. they have 30 days to reach a settlement or default again. the meeting demonstrates the nation's willingness to negotiate under fair terms. nike has been shut out of the world cup final. when argentina and germany face-off, you won't see any swooshes on the players sure. both teams are sponsored by adidas. lost in thehope semi finals. that is your latin american report. it's called summer camp for billionaires. in sun valley conference

idaho -- jon erlichman is there and joins me with a look of this year's hottest trends. >> there's no doubt that it is summer camp like, but that doesn't mean you can bring your smarts for challenging conversations and potential dealmaking. even in forming the group overall. the guy spent time at stanford and spent time in complicated areas like robotics and artificial intelligence. he ends up working on some wild projects like self driving cars and google glass will stop then he decides he wants to tackle education. here is some of what he had to say. >> what we find is an enormous thirst for education to get here.

>> obviously, there's a huge move toward education. one thing i wonder about is what's the process getting them to recognize? there are plenty of companies and technology that are big and easiest tied to what you're doing and maybe they will be fine with that. get the employer to recognize that compared to a traditional degree customer >> you would be surprised. is we get partners from phase look and at&t. we get their best engineers to build what we think you need to know. as a result, we take it very seriously. >> do you see yourself doing more partnerships or bringing the education to some of these

big platforms? >> we partner with those institutions, not so much to work on the social platforms, but to reinvent education. >> i know one of the reasons you are focused on this area is you feel strongly that people's careers are changing quickly and they will have multiple careers. you are in the same boat. should we assume you will be moving onto the same thing? >> my wife asks this question a lot. wasorically, one education sufficient. has changed is technology is moving faster than ever before. can we one big chunk over four or five years in the beginning. it has to be on demand and it has to be a lifelong service.

you also talked about google glass. that wear that in public glass holes, but i guess you have people doing it in sun valley? >> we have a few. we talked about how diane von furstenberg bought her own google glass to show off to everybody. like a lot of people working on glass right at the beginning, he is impressed by what has been able to be accomplished in a relatively short amount of time. the idea of putting a computer on your face a few years ago by the general public, they may have been off -- they may have laughed it off. if consumers are available for it. google has not made this technically available at retail level everywhere. you can go out and spend 1500 bucks and not everyone wants to do that.

it's going to take a little more time. >> it's going to be expected that diane von furstenberg's look more stylish than most people's. thank you very much. later today, john will be speaking with the imagine entertainment cochairman from sun valley. "modern family" and "arrested development" genius. don't miss that. the enemies nominations -- -- surprises nubs and snubs. we will have all of that and apple tv when "bottom line" returns. ♪

>> e 2014 emmy nomination and it appears to get -- it appears again that non-broadcasters were the big winners. joining us for more is the

director of research at horizon media and the head of north american research for bloomberg industries. let me clarify first of all non-broadcasters -- we are talking about not the networks. >> you are talking about not the big four rod casters. you are talking the premium networks, hbo, basic cable networks like amc. .> not fox >> fox got shut out of a lot of categories. i think a lot of people who thought andy sandberg who won a golden globe -- all he got was a renewal for a second year. he did not get an emmy nomination. but i would say his performance is awkward at best. it's not a very good show. >> what that show does is brings in young viewers. in broadcast tv, that is a rarity. >> we were talking about drunk

history and workaholics on comedy central. these it not get a nomination. i love them. it and get aight nomination, with john oliver. but the same old comedy central pair, -- >> they won the last 11. stephen colbert one it the last time and john stuart run -- one it for 10. jay leno did not get a nomination. they picked "the tonight show" with jimmy fallon. leno hasn't won since 95 cities going out without even a nomination. >> his show is not very good. although i love leno's garage on >> i think hboop with "game of thrones" is the lock. >> they have 99 nominations. cbs, the most nominations of any of the big four broadcast networks was only at 47. fox only had 18, less than what

netflix had at 31. it is tremendous to see a the balance of power of programming has evolved. >> hbo has must see tv. you have to watch it. you and i were talking about watercooler talk -- those are the watercooler shows of our day. >> they have a competitive advantage. they don't have to worry about advertisers or sensors, so it's not a level playing field. >> but you have to pay to get them. the academyrue, but doesn't matter about that. what matters is the quality of the show. ones who can push the envelope will stop >> netflix is a game changer. disrupt, bute term they disrupted the pace. they took it vantage of what is

a tremendous change in consumer media habits. younger consumers are consuming so much more media over the internet, so why shouldn't video be there. who comes in to establish a beachhead but netflix? they have established brand value. they don't have the best content all the time relative to what you could get on a unbilled cable package but at the price point, a lot of people, over 30 million have found value. that allows them to reinvest in programming. it's also a different way to watch shows. on sundayappointed that i can't watch the next episode of "game of thrones." is there any chance the traditional cable operators are going to move to that model where they release a whole block of the season that once? >> they do stop thereidays will were something like 26 different marathon shows that day where they ran episode after episode

and let a image viewer and watch, but they were all reruns. the original series, that might happen, but if you look at streaming video, it's only netflix and amazon doing that. hulu is not doing it. it's not for everyone. >> i want to be able to watch hyper from "orange is the new black" for 14 hours in a row. if we talk about evil who are innovating, does it go beyond that? do any youtube shows get emmy awards? i mentioned jay leno's garage as a joke. >> they're not getting awards yet, but they are getting paid. to $980ust paid up million to buy maker studios which is a producer of professionally produced short form videos. almost a billion dollars. we are seeing more and more deals there.

>> those productions don't have the dollars behind them. be $100thrones must million. >>. only that, but it's popular. competitione was from netflix. they have really ramped up their shows likebudget and true detective and silicon valley are first-time nominees. >> don't get me started on "true detective." life-changing. i can't wait for the next one. >> he could get an emmy and oscar in the same year. that hadn't happened since helen hunt. >> thank you so much for joining us. we're going to take a quick break. stay with us. another check on the market on the other side of this rate. this break.

♪

>> get the latest headlines at the top of the hour on bloomberg radio and streaming on your tablet, phone or anywhere you stream. that does it for this edition of bottom line. i'm matt miller in for mark crumpton. "on the markets" is up next. >> it is approaching 56 minutes

past the elena means bloomberg elevation is on the markets. let's look at where stocks are trading about an hour to the closing bell. the kleins are smaller than they were earlier but still concerned about what is going on in europe. the major averages all down about .4%. selling inn some stocks but buying in treasuries. not much, but enough to push the yield down to about 2.53%. not a lot of change on the treasury market. for more, i want to bring in adrienne miller. this europe situation is interesting, sort of coming out of nowhere and rearing its head again. how seriously should we be taking it? it seems like there should be elements that are quite different. a seriousity, it's

problem in portugal. the parent company, that's where the credit issue is and where the for equity swaps. has a connection to one of the biggest banks in portugal and that's what is scaring people. they are fresh off the banking crisis of a few years ago and the fact they -- the summer and that market has not been dealing from that he does banking reforms have not been repeated. can it spread? sure. is it likely to spread? probably not, because it's a big safety net underneath it. >> you are a fixed income guy. would you be buying sovereigns in europe westmark >> selectively, but not from the periphery.

child forhe poster the yield we keep hearing about globally. you have seen the periphery debt come way down, much lower than they should. you've got a five year yield and spain. kind of ridiculous if you think about it. there is still a long way to go. you need some things that happen before you get the pricing we need. >> how about european corporate? >> high-yield european is interesting. certain areas of investment grade, perhaps you look at areas that might be of interest but credit markets are quite rich. >> let's bring it back to the u.s. we've got the fed minutes but it doesn't seem like we're seeing much change. the fed is very aware of what is going on in the market will stop what do you make of that?

they're not willing to do anything about it. >> the fed has created the environment that fostered this complacency. it's ironic here that coming out of the meeting yesterday. they just have to look in the mirror and find out why. >> are you staying away or is it not time to do that? >> may be the belly of the curve, there is still duration risks. worried about that. >> always good to talk to you. will have more on the markets of it later. "street smart" is next. ♪

>> it has been quite a day for the markets. fear over health of the european bank market had stocks falling at 1% will stop the dow cutting than 100s by more points. i'm betty liu in for trish regan. this is "street smart." welcome to the most important hour of the session. 60 minutes left until the closing bell today. brian grazer rubbing elbows with the media elite at the summer