move, yields higher. pound sterling continues its descent. a conversation on your more work, less life balance. good morning, this is bloomberg "surveillance." live from new york. it is wednesday, september 10. i am tom keene, joining the is scarlet fu and adam johnson. adam has our morning brief. >> overnight the french foreign minister lowers next year's growth forecast to 1%. it had been 1.7%. they keep lowering growth. >> not all of europe in recession, part of europe. >> just the second latest economy. >> negative yields in germany. >> japanese yen to its weakest levels in six years. >> abenomics is working. >> he wants to make products cheaper so japan can't export -- can export more. apps. u.s., mortgage

9:00 p.m..ght at president obama talking about how to address the threat from is, islamic state. >> where's the secretary? >> just landed in iraq. trying to pave the way for some entriesd activity by the u.s.. -- some increased activity by the u.s. >> he just got to baghdad. >> i spoke to the secretary of the air force. she made clear this is a long mission. maybe we will get details. >> one of the words i see is the complexity that the president will address tonight. you have earnings. nothing before the bell. after the bell, restoration hardware and men's wearhouse -- because you like the way you look. >> that's what tom says every day. wearhouse.

eu ministers are meeting right now trying to discuss the perhaps latest edition of sanctions. >> finland says let's get going. at equities, bonds, currencies, commodities. futures up 2. 10 year yield higher. euro-dollar 1.2945. nymex crude and brent under 100. big showing, some of the fragility out there, tony dwyer will join us in the 7:00 hour with a mix of 13.5 0 -- four 0.5599., yen at 106.66. we've got an extrapolation. two year yield before the 5%.is, 2%, 3%, 4%, here's the crisis.

all i did was extrapolate out what used to be in normal times. we are barely coming up at .55%. to getway to go to 1.1% on trend and even where we were in normal times. >> you realize how low rates are. we talk about them every day. these are really low. >> for those of you that are nd retirees, this is your financial repression. this is the pain and suffering of so many americans. >> so many people are crowding into equities. >> too much geometry for wednesday morning. >> philip morris international upping its dividend this morning, $.96. yields.pay close to 5% that is your bread and butter now. that is what people are buying equities. >> front pages. >> the president plans to lay

out his strategy to battle islamic state. a primetime speech begins at 9:00 p.m. eastern time. among the steps being considered here are expanding airstrikes to hit islamic state targets inside syria, giving more aid to moderate rebels inside syria and stopping foreign fighters from entering syria and iraq. there's a theme. >> we've all become global t'sro, if not experts, wha the alternative? people who talk a lot. it prescient that he is giving the speech on september 10. i wonder how he and congress will address the date of the speech. >> there's been a change in tone, more americans want action on foreign policy. they feel the u.s. is not enough. that might be pushing everything. along with the high-profile murder of those two journalists. this is just me talking.

so i might be out of turn. better to address the nation on the issa september 11 than to wait for the day. get a jump on it. at least you are taking action and not waiting for the day. we will get ahead if this thing. maybe that is a silly comment, whatever. >> twitter question of the day. >> what do you want to hear from the president tonight in his rest? -- his address. tweet us. >> tonight on bloomberg television, mark halperin will be covering the address starting at 9:00 p.m. with the speech and analysis. >> new show the first week of respect,ith all due looking for. show.e of the >> this was on twitter 12 hours

ago. dollar general shifts gears. they will make a hostile bid and go directly to shareholders of family dollar on their $9 billion -- >> family dollar chose to go with the lower bid from dollar tree. saying they saw regulatory issues with the dollar general bid. dollar general is now going straight to the shareholders. >> in order to try to assuage regulators, dollar general offered when it updates bit for the second time to divest 1700 stores, that's a big deal. >> to go to our next frontpage and fold in dollar general, this is the m&a activity and the effervescent confidence of what is out there. >> certainly in equities. on the other hand, you have a lot of consternation and handwringing in the currency market because of the concern over the scotland independence vote. thursday. a second poll shows the vote as net in neck.

big deal, derek halpenny with think of tokyo-mitsubishi will give us scale. sterling, 1.6095. on for microsoft. the company in talks to buy the maker of the popular videogame minecraft. microsoft might pony up more than $2 billion for the swedish company that develops minecraft. as early could be done as this week. have you ever played minecraft? >> it is played at my house? >> by whom? >> any child. >> any child, exactly. >> the seven-year-old. >> do your math and you can play that game. >> you build stuff and you can escape sunday's. -- escape zombies. >> we're building stuff.

>> the day after apple comes out with two new iphones and the i wallet. >> look at our comments on bloomberg video with howard lindzen about a resurgent microsoft. >> really speaking to the trends and the five. what is the word? the zeitgeist. shares trading a little lower here in the premarket. pretty much everything they announced, we expected. >> are you getting the green or the red iwatch? is for telling time. for everything else i have an iphone. a the iphone basically made watch obsolete. the watches a piece of jewelry now. apple has an iwatch, which can only work with the iphone. >> i probably will get the iphone 6 plus, it has a bigger screen.

i like to play spider solitaire. this screen is too small. that is totally absurd. >> for his solitaire needs. those are your frontpage stories. >> wow. >> trying to decide how big a phone i want. >> you need the biggest one. >> you are 6'5", you can carry a big screen. president obama will speak to the nation and congress this evening. in search of a cogent message signaling his leadership against the islamic state. the president will need executive presence. our guest host is chairman and founder of the center for talent and innovation. this book is a sleeper. i opened it and said yeah, yeah. yes what? executive presence, wonderful to have you. what would be your message to as he speaks to

the nation on a difficult topic? my message is simple -- he needs to create a more .mpathetic bond with the people emotional intelligence. this is the thing that is on leaders lists not even 10 years ago. the ability to sit inside someone else's' shoes and understand when they are out. when the president talked about the trayvon martin case a few months ago and cried on television, people love that. it showed he had a heart. i think he suffers from being seen as disconnected. too cold and distant. shift fromld be a his campaign. i remember speaking with ted sorenson, the speechwriter for john kennedy. he fell president obama was a

better speaker than president kennedy. how does he get that pixie dust back? >> he is an amazing putter together of words. it is about passion, connection, empathy.to the -- and >> what did ronald reagan do effectively? >> he had the common touch that could convince everyone he was the man next door and he had led a life like theirs. about very basic american things. he did not do the professor thing. he was not above the fray. there was an accessibility. the most effective u.s. politician today if the president is not getting it done on emotional intelligence? >> we asked 30 liters and 4000 executives who their icon was. first, jamie dimon.

his grace under fire and personal integrity. the second was nelson mandela. of indoor miss track record of authority and inspiration. in a hard way. 23 years in prison. had extraordinary emotional intelligence. he understood at the rugby game he had to get onto the field and hug the afrikaans captain. it would signal to south america that he was in the business of healing. we willa ann hewlett, discuss. well-timed in the theater and pageantry of this evening.

>> another theater, the theatre of scotland. stepping into the unknown. the latest research report from our next guest. we will tell you what he knows about next week's vote on scottish independence and how it might affect the currency markets. this is bloomberg "surveillance." streaming on your tablet, your phone, and bloomberg.com. good morning. ♪

x good morning. bloomberg "surveillance," sir richard branson will be with trish regan. at 3:00 p.m. a good conversation. maybe he will by scotland and solve all the problems. 3:00 p.m. this afternoon on "street smart." this is bloomberg "surveillance," i am tom keene. with me, scarlet fu and adam johnson. let's dovetail the markets. more volatile than august. markets move after the

complacency of the summer. bond markets on a tear. the u.s. two-year higher, the german two-year a negative yield. currencies get it going. the yen pledges, abenomics is getting a week yen. tough to make you move scotland. joining us is derek halpenny of bank of tokyo-mitsubishi. the yen, is this what mr. abbé e wants? does japan need a weak yen? >> is part of the story. we had the japanese equity markets hitting the highest level since july 2007. today, we had comments from the minister about rapid

moves in the market. my sense is that perhaps they realize we are getting closer to bigger moves in short-term interest rates, which could drive volatility in the foreign exchange markets. >> in that, john country should famous claude trichet's "brutal move." theirs try to fix problems with a weak currency. >> evidence of that in europe and japan. i would argue in terms of the have comeen that we from very overvalued levels, which was fueled in part by the policy on the other side of the atlantic. >> if you look at the brutal move of pounds sterling, from 1.70.

breaksclusive. you and i can afford harrod's in october. shopping spree. >> following the bank of england and mark carney's comments where he hardened his position against sharing the pound. how much of the scottish that has been priced into markets? >> in terms of the cash markets, the spot foreign exchange rate. on a trade weighted basis, we are only down about 3% from the high this year/ if you take september 2 as the point where we had a shift towards the yes campaign, the trade weighted index is down just 2%, sterling-dollar is down 3%. substantiale that a amount of risks are still out there and have not been priced in. if we did get a yes vote

next thursday, we could see moves to the downside. >> by the same token, u.k. gdp is rising 4.1% and europe as a whole is flat. why is the scottish vote so much more important than fundamental growth to the pound story? is simply the surprise. i am as guilty as the rest of the market in this. i did not think we would be in a situation a week before where it was neck and neck. consistently over the last 12 months, the gap has been close to 10 percentage points in favor of the better together campaign. fact thatrprise the so little risk has been priced in it is becoming the focus. >> speaking of the focus, derek halpenny of bank of tokyo-mitsubishi. witha ann hewlett with us, her book "executive presence." speaking of leadership. drums rolling for the queen to step in and speak.

britain, wales, and scotland. should she speak? >> it would be wonderful. she is a healing force and can be sensible. one reason why this is rattling the culture as well as the markets is that it would unleash a kind of spluttering. my whole piece of britain, which is wales. >> is wales next? >> could be. they have their own assembly, this has rattled wales. it's the size of brooklyn, kind of ridiculous. >> that is protective. -- perspective. is theksclusive, wales size of brooklyn, new york. derek halpenny, thank you. see you in brooklyn. >> the same population of brooklyn. it has more land and sheep.

same number of people. >> there you go. a special "surveillance" theme. leadership. we speak with the president of barnard college and the incoming ceo of booz allen hamilton holding our guest host sylvia ann hewlett is here for the entire hour. we will be right back. ♪

>> good morning. i am tom keene. with me scarlet fu adam johnson. futures flat. >> the president ready to make an address tonight. talkingnancial times,"

about how the world and americans have grown weary of barack obama. his introversion once made him look adult, he is now live. aloof.s now he says the saturation quality of the modern media means all contemporary presidents fall prey to the seven-year itch. it is the seventh year of his term. >> the book on the reelection of the president really addresses the struggle of how he got there versus where he was two years or three years ago. and critically where he is this evening as he speaks to the nation. >> when you look at what president obama must do, is it a case of we have gotten tired of him and he needs a refresh? or is there leadership quality at work? >> the two things people are really affected by -- there is something called gravitas. which is confidence,

credibility, and decisiveness. he has much of that. he's a little cautious but in the end he comes to some pretty real decisions. the surge inmed afghanistan, it took a while but he got there. the thing he is not cracking right now is there's compelling, charismatic connection. >> we will get to that next. sylvia ann hewlett with us. >> covering the president's address tonight at 9:00 p.m. ♪

>> good morning. "bloomberg surveillance." tonight, 9:00 p.m., mark the president addresses the nation. look for the coverage at 9:00 p.m. this evening. there is no other topic today in the nation. this is "bloomberg surveillance." top headlines. >> detroit clearing a major obstacle on the path out of bankruptcy. the company is one of detroit's biggest creditors. theial will determine if

city's plan to settle its debt is fair. -- will be the first remembrance since the museum dedicated the attacks opened four months ago. they have received more than 100 artifacts donated by families. more fall for ray rice. he is being pulled from and 15 nfl art matt videogame. he was suspended after video showing him assaulting his girlfriend emerged. the ravens have terminated his contract. it is mind-boggling. >> where is the leadership that the nfl? >> there have been a number of people calling for the resignation of roger goodell because he only suspended mr. gamesoes code -- two originally. >> this is the real deal.

the commercialism stuff misses what is going on. a lot of the media coverage has been dead on. heels ofcoming on the two racial incidents within the nfl. shifting gears, booze and -- allen -- takes over as ceo. he is a 20 year veteran. thank you for joining us. pleasure having you here. on thennounces i wallet heels of jpmorgan, home depot, target, take your pick. how do you deal with cyber security? asking theu for question. the reality is that it used to be cyber security was about building a big wall around servers and networks. it, every time

somebody builds a 10 foot wall, someone will build an 11 foot ladder. do we search the world and understand what is coming at you? the badoing to do things? when will they do it? defensesspecific against those attacks. >> you can protect what is coming from outside. .here are threats within how do you firewall internally. >> you are trying to foster an atmosphere of trust and collaboration. on the other hand, you need to be on your toes. there are still things you can use to approach that.

>> sylvia is here with us. how would you address this? the predictive analytics that he has put in place to ward off or to spot the issues coming down the pike, there is a fascinating way in which he has done that. musician's and art folks. the idea is to scan as many approaches and toolkits that work and to have the wisdom at work within booz allen. >> i like that idea and i think chicago isersity of where you look at the game.

this. you have a government that wants a single chain of command against the wisdom of crowds in the tension you face is a larger -- as a larger spy contractor is next. your business is raiders of the lost ark with the arc going into the tomb. it is two different worlds. the government is more innovative than we give it credit for. a lot of the notion that amazon is going to deliver packages two --rs or -- to your door >> you believe drones will deliver a package to me at my door? >> i do not know. >> we get the bloomberg discount. becomee are working to our client's essential partner. we're trying to figure out how

this technology is going to work. when you put that in orbit, how will it work. firewall is what you have done with your people an amazingis reputation of someone who is turbocharged. with 45-year-old white guys, but with minorities and millenials. the system of engagement, whether this is a virtual -- or garage, which allows the millenials to come forth with ideas. what are the best practices booze out of learned -- booz allen has learned? >> snowden work for us for a few weeks.

>> understood, but you got the bad press. our job is to work with our thists and to ensure that kind of thing does not happen. we reviewed everything we have. >> the single best thing you learn from that review. >> we have done all of the things that we needed to do. you have to try. you have to do the best you can and limit the damage. >> after the boston marathon bombing, and the company turned -- they turn to a company in houston. it learns to recognize behavior that looks off. is there a way to do that within systems? today,re doing that

internally and next firmly. we talk about data analysis and the notion of data scientists. it is a new term. it is powerful. .hey are not just numbers data is pictures and video. to say thiscapacity person that is acting strange across the tv camera, let's look at her webpage. a bad actor or someone who is acting funny. >> thank you so much. up, colleges say economic diverse bodies are a priority. ♪

>> good morning, everyone. our twitter question of the day is on be surveillance. what do you want to hear from president obama tonight as he

addresses the nation? this is "bloomberg surveillance." adam johnson is trying. >> today single best chart is on colleges. we have to look at which colleges lead the way on economic diversity. a college access index, which measures the share of freshman receiving pell grants. based on that, vassar comes out on top. that --interesting is doesn't show up until number five. .mary's, names like st.

>> i think what we are realizing is the social economic diversity may be the last crucial pillar of real diversity because poor kids to not get the same kind of educational background k-12. they do not apply for the top colleges. when they do, if they managed to apply, they do not have the educational background like it and in. what we're discovering is you have to find that the less wealthy kids and actively recruit them and let them know they can come. >> one of the number one things i get is that colleges say we have a lot of aid and i cannot tell you the number of parents that say 50 five and they gave me 3000 baht. -- 3000 bucks. it is an insult.

>> we have a lot of money for financial aid. it may be a less expensive -- >> is it needed mind -- need blind? >> it is. >> unless you need a left defenseman to put a puck in the net at the third. . >> as the parent of an 11 and 8-year-old. if more schools do more to enroll lower income students, does that mean more tuition for those that can't afford college? the wealthiest schools, which tend to be the top schools. we have been lucky. years and years of fundraising have -- i believe all of the financial aid is fully endowed. benefactor.

you can get an education in england for $58,000 a year. going up rapidly with the same issue. and u.k.bt in the usa -- if they are going through the roof, this is scary to poor families. we find african-american college graduates are twice as likely to have high levels of student debt as white students. one of the vibes here, one of the reluctance is to take on -- before the college is you have friends coming out with debt. >> those debt loads are not coming from the schools on this report. >> the structure is important in that the lower and middle level

colleges -- >> it is mostly the for-profit schools where you see those debt loads. >> i disagree. >> do schools with a more narrow , black colleges for instance, do they initiate diversity better than others? >> i do not think you can generalize. women'sd barnard are colleges. they are among the best. tendency, if you are representing a minority group, to want to be generous and more inclusive. find you want to try to

the 10 most likely people to succeed, who are coming from tough place in life, how do you find them? >> you look for this part. you look for the kid who is who is intellectually curious, who wanted. having thousands of thousands of 17-year-olds in my life, you can see it. the trick is to find those kids and convince them they can make it. in the next hour of "bloomberg surveillance." we will bring you --. mrs. "bloomberg surveillance."

>> the president's address to the nation. that is coming up that 9:00 p.m.. what you want to hear from the president tonight. @bsurvelliance.

>> each and every 70 -- study shows that -- is found working and it born in the -- and in inordinate amount of hours. 87 hours per week. sylvia has written about this in her book. why are americans so stupid about this? why is our work life balance out of whack? >> many of us do not have enough control. over when, where, how were get done. work isg we find in our

a bitoving up that ladder makes a difference to your scheduleo control your soigure out how to balance you are not drained. one thing we find in this work is that women feel that they are comfortable in the middle, driving for the top job might put them out of their comfort zone. create job might overloads they cannot imagine. jobs give you more control. how do you get yourself on a path to get one? from a college president with 14 children. she demonstrated she could take the heat the bigger the kitchen she was asked to run.

she said i do not need the pat on the head to excel. >> this is a big deal. you have written so eloquently about the limitations that men and women have. >> we are all human and limited. you do more of the childcare and everything else care. is onewas talking about of the things that women really need and people of color need in their career is they need people to give them tough feedback and criticism. i did not feel lucky at the time, when i had older white guys telling me ways in which i was screwing up, but it was useful. she want to point out what described is my perception of barnyard.

the kids show up to play hockey and everybody gets a trophy. >> here's the deal. to have to project, you have have great communication and you have to be polished. how do you get these intangibles of leadership? we had an interview that will show how you get men to give women really device. -- giveaway been real advice. feedback does not cross lines of race or gender. share thisant to with everybody. horatio, i will want to get your feedback. according to-- gallup, successful students have one or more teachers who were mentors and they had internships related to what they were learning.

only 22% of grads surveyed said they had a mentor and only 29% had an internship. how do you bring these s in and make sure they staying gauged? someone who listens to your problems and throws an idea here or there. a sponsor takes an active interest and want take the opportunity to give you the chance to succeed. if you cannot shine, you cannot move ahead. the other point, with the millenials, what we have found, there is mentorship and reverse mentorship. if you're willing to listen and engage, you will learn a lot. just asl mentor you much as you will mentor them. >> they have this huge culture --.

one question i have always wanted to ask -- what in your background made you understand the power of difference -- the necessity to be open to valuable ideas from different kind of people. you have put it at work at booz allen. where did it come from? that ask about the fact an immigrant, you're trying to fit in. you spend too much of your time doing the opposite. you spend too much time minimizing differences. it to me a long time to get comfortable with myself to recognize that if i brought my whole self to work, i can add more value. when we have done that, our colleagues have embraced that how we have gotten where we are. >> thank you. let me do a forex report.

we go to the equity markets with mr. dwyer. . am looking at euro 129.49 >> we will be back. ♪

but on this september's -- >> on the september 10, the president speaks to the nation. let's call it the apple holiday season. the new products should be under each and every tree. is wednesday, september 10. i'm tom keene with scarlet fu and adam johnson. tony dwyer is it unable to speak about individual stocks like apple. frenchman -- the finance minister -- the french finance minister speaks.

the toyota is getting cheaper, which is what they want to do. boost exports. weekly mortgage app is down for the first time in a month. wholesale inventories come out at 10:00. we have a speech from president obama at nine :00. he will be addressing how he plans to combat the islamic state. john kerry just landed in iraq this morning. the bell, restoration hardware and men's wearhouse. eu ministers are meeting right now to discuss additional sanctions against russia potentially. a little bit of a pullback over the last couple of days. higher yields in the two-year.

brent crude is under 100 earlier this morning. game on for microsoft. the software giant is in talks to buy the popular videogame mine craft. this deal could happen as early as this week. mine craft has sold 54 million copies. dollar general begins on hostile takeover attempt. it is pursuing a $9.1 billion offer for family dollar. and jamie dimon is shockingly present, despite treatment for throat tranter. -- throat cancer. he will undergo radiation and chemotherapy for his condition.

--we wish mr. diamond well mr. jamie dimon well in his treatment. the president will deliver a speech tonight. he plans to lay out a strategy to battle the islamic state. here is our white house correspondent, phil mattingly, to give us an update. who is the president speaking to his evening? >> really, to the american people. it sounds somewhat trite, but in speaking to white house officials, their feeling since june is that they have not successfully explained what their strategy up to this point has been. and they have definitely dropped the ball how they want to counter this threat going forward. that is the bush. obviously, they care what members of congress think. however, what they want to do is try to align the u.s. people

behind what they want to do. fit inwill the president the 13th anniversary of 9/11? >> elegantly. they are -- delicately. day are cognizant of the and that it's coming one day before. theone year ago to the day, president spoke to the nation about syria. that was about trying to get chemical weapons away from bashar al-assad. that effort failed. not only will he say that he is prepared to expand airstrikes into syria is you will see him going all in on training and freeing the moderate rebels in syria. interesting is the dynamic of looking where he was a year ago, where they were

extremely reluctant to even touch multiple pieces of this to really going all in now. >> you mention an about-face. he effectively did an about-face on june 30. he said he was going to go added single-handedly, and then last week he said he would work with longer -- work with congress longer-term. might that effectively be saying, i'm not going to ask you to help me on immigration, congress, but i am going to ask you to help me deal with isis. >> the white house put out a statement saying very plainly, the resident and the white house feel like they have all of the authority they need to implement whatever strategy he's going to announce tonight. they believe they have the authorization to move forward on expanding strikes into syria without congress at all. what they do need to -- from is that there are where

they will need money to actually do this. a couple of billion dollars to pay for the expanded airstrikes into iraq right now. maybe $500 million to train the syrian rebels. want congress't to get involved in the authorization, they do need congressional help with the pursestrings. >> phil mattingly from washington. thank you so much. on bloomberg television, the presidential address. look for that at 9 p.m. on television and radio worldwide. our twitter question of the day addresses his address. what would you like to hear from him tonight? fax -- >> in looking at the market, futures are higher and apple shares are inching up.

apple did the big product unveiled yesterday. it was the moment they had been waiting for for fan boys and investors. our guest admits to being an excessive with brand and design. did apple deliver the goods with both demos? think they made incremental advancements on the phone side, much of which were lagging behind what we had seen in terms of the android phones with size of screen, etc. i'm probably going to go with -- the biggerion factors,ecause of two and one is, battery life. >> and it gets worse and worse with the grooved ecosystem. with the improved ecosystem. >> exactly. and with the camera as well. out thatght i point

the bloomberg app has no battery drain whatsoever. >> none whatsoever. deliver the goods when it came to equity investors. >> our analyst did put out a comment this morning that he is higher in the street -- it is higher in the streets than investments. the team from wells fargo big boringt that microsoft, intel, cisco, it's back. that is ready action is. are you hearing that? >> i do. many of those companies are providing the capital and supporting the capital. that is the place to be. david potok was kind enough

to write up bloomberg surveillance with apple yesterday. do they have the vision to be the first chilean dollar company in american capitalism? dollarhe first trillion company in american capitalism? >> that is the question i've been asking myself. we did not talk about the watch. i think it is important that we do for a moment. i was pleasantly surprised by what they put forward. >> in the design? >> in the design. not because what the watch entails is so much more and that's -- more advanced than what is out there. the packaging is beautiful. and the wave will interact with the phone is extremely powerful. , they don'tis today have to do that much to continue on in that trajectory. >> he will be buying three iwatch is for christmas.

but i will include my wife in there. include my wife in there. >> for iwatch is. iwatches. abilityu shut down the of the people at this table and those watching to get credit, we will move forward. as long as earnings are higher, the market is higher. >> and just to remember, will tom says -- uncle tom says iwatch for christmas. >> we will discuss the markets next with tony dwyer.

>> good morning, everyone. bloomberg surveillance. the two year yield is up 5.6%. that get your attention. good morning, everyone. i'm tom keene, and with me, scarlet fu and adam johnson. one-page treatment on ali baba. >> executives are making their push with investors. they are on the roadshow right now and they seem to be doing fairly well. the group has received enough to cover the ipo within

the today's they've been on the road. the hour,hosts for this speaks to the difficulty of getting access to the chinese market at scale. people want in on this because of what it represents. >> 1000%. i think alibaba is the most important chinese internet company by a wide margin. there will be a lot of investor demand for that. at pretty much any price right now. this is such an important thing for china. they will handle it very carefully in terms of how much float they put out and handling the market properly. >> and some issues with pricing with the other big long-awaited ipo with facebook a couple of years ago -- and i >> yes, but i think you've seen bankers have gotten pretty smart about making sure that even if they have to

leave a little bit of money on the table, they are making should do not overprice when they go to market. >> this is likely the largest deal we have ever seen. at what point is there too much new product going on the market? rates are low, people will be chasing yields in the equity markets. >> you want to be careful also. you hear a lot of "it's a bubble," because of the valuation of twitter and things like that -- i >> you mean 14 times sale. >> yes, that stuff. when netscape came out, it doubled in price the day before and then doubled in actual price once a traded. there are like 47 firms involved with alibaba. does his world need your world? because you are

raising capital. it is those companies that .rovide the capital >> i do think we need wall street. certainly today. but one of the most areas -- one of the areas we are most interested in across the board is financial institutions. coming up, a conversation on uber. all the rage. stay with us. ♪

>> good morning, everyone. tried to convince be to buy the watch and both iphones. tony dwyer is with us as well. here, she is buying all three iwatch is for us. adam johnson is here. >> i already have a watch, but i will buy a new phone.

detroit clearing a major .bstacle out of the path will determine if the is actually fair. suspendedcall the nfl ray rice after a video showed him assaulting his girlfriend. that was actually the summer. it took the nfl a long time to take legitimate action. the ravens have terminated his contract. president obama is preparing to address the nation tonight. possible steps include expanding airstrikes to hit targets inside syria. and then stopping foreign from getting into serious and iraq.

be covering mr. obama's address. 9 p.m. eastern time, discussing all of the ramifications of that address afterwards. be extra -- excellent coverage. >> and the twitter question of the day relates to all of that. what do you want to hear from the president all -- president in his address tonight? tweet as. -- tweet us. being debated today. adam cannot figure out which color iwatch to buy. all dwyer has pushed it aside. ,e sees higher stock prices touted simply on a good economy. i will go quickly. the market correlates to the of earnings. as long as the direction of

earnings is positive, it is not whether you are a buyer, but whether you are a more aggressive buyer. when earnings are driven by economic activity, that is driven by the slope in the yield curve and availability. >> we are not even in recession. >> not even within a light your of it. inflation has been flat for the past four years as well as fed funds. interest rates have been flat. why should we become negative the echo nothing fundamentally has changed -- why should we become negative? nothing fundamentally has changed. prices have gone up. >> all of the geniuses are telling me chair by back is going to change and this and that. i don't observe a changing use of cash. >> it's not even close. for example, corporate credit insurance. the today's following the labor day holiday were like the fifth and sixth largest days of corporate credit new issuance ever. that means companies are still taking in earnings and retained income, but a tremendous amount

of cash to buy back stock. >> that shows the confidence has to be out there. >> the confidence and the need to take advantage of low rates wild you can. , our guest host for the hour. >> i'm wondering down on the ground, because every time whether it was the mortgage crisis or whatever else, it starts with the mortgage populace. what about earnings, not by corporations, but by the large masses in this country echo -- in this country? how much of the spending power and leverage is coming from real dollars and wages? >> this is the waging debate on wage growth. >> wages are beginning to grow, but what creates the change in the economic cycle is fed policy. tighten interest rates because wages and real growth is beginning to pick up. it does taken four years to get

there. -- it just has taken four years to get there. we are still early in the economic cycle because we are building those wages. like that of the real question to me, are we going to see the real wage growth? thend in the discussion of haves and have-nots, the real question is whether you can have dwyer optimism with so many americans struggling because of wage growth. >> and it really gets to whether there has been enough the leveraging at the personal level. not the corporations, but has there been enough personal deleveraging to be able to spend ? >> i would say, yes. the evidence is in the last two months, you've seen an excel or a shot consumer loans. that is the first time in the cycle -- and acceleration on consumer loans. that is the first time in the cycle. >> but hasn't been enough that acceleration in leveraging is really good? it takes a lot of 2500

dollars payments to pay down your credit card, but if you throw your keys back to a bank and take a hit on a $400,000 house, that will change the leverage ratio. it is being skewed by something that has never happened before, which is so many people flipping the house back to the bank. >> the first two weeks of september have been pretty good for retail. >> on the high-end, that has been the case. for walmart and target and the lower end, that's a struggle. in the haves and the have-nots, is it obvious that you pick luxury staples? >> we are neutral on consumer discretionary as well. the rates will begin to go up. that will begin to restrict credit. widete, credit has been open. people can borrow money to buy things. so far, it's the haves and have-nots. but the average hourly earnings

are all beginning to pick up. that is a good thing. >> that is the thing we need to watch. >> yes it is. here is one for the haves. if you are planning to buy a villa in south america, don't. there is a nasty new tax in columbia of all places. ♪

>> this is bloomberg surveillance. i'm scarlet fu here with tom keene and adam johnson. we are going to get you some company news now. of mancoime chair senator has passed away. he spent billions to expand the company's reach peon spain. the board will name a successor today. worked on taking your hands off the wheel. the technology will take over steering, braking, and accelerating in stop and go traffic. and can execute -- accelerate up to 35 miles per hour.

lufthansa is in a standoff with munich over canceled employee benefits. our guesttters now to host. --moiceman -- no koyfman koyfman is with us. there is a massive challenge to lift. you are a huge super bowl. why are there so many people doubting what they can do? bull.r why are the silly people doubting what they can do? >> jealousy. markets and categories, he's going for the jugular, and many businesses do

not like that, plainly put. winners.will be fewer is that where we are heading with uber, with facebook? there will just be fewer winners? talking about is economies of scale, barriers to entry. we are seeing some of that certainly on a local level with uber as they get more and more supply, more density, and it will push prices lower and it becomes tougher for some of the competitors. but to me, that is good business. >> from where you sit in the technology world, they hired david plouffe, who has been on bloomberg surveillance many times. the wrinkles with germany, or portland for that matter. how do you see that going? >> it will be slow and painful, but they put somebody in the seat who knows how to do it.

the reality is that it is inevitable and cities have to be able to offer compelling offerings to both their populous and to visitors. >> what i love about your work is that you are in a microeconomic foundation with so many talking heads lathering out at talking head conferences, etc. you don't do that. of ubere fundamental that they have to go out and get make a living? >> certainly, on the supply side. on the demand side, they have to get loyal customers so that the value is high. at the end of the day, if they are able to provide wages above minimum wage, a flexible schedule and a good work environment, i don't think there will be a shortage of people. ethically challenged, what do you mean? some of the best have been

the most aggressive, so it does not surprise me at all. but i think hope -- folks that are competing with them will find that difficult. whether they are ethically challenged or not, they are certainly aggressive. from my vantage point, it's to their credit in terms of generating hundreds of billions of dollars in that market. when ist think of uber look at the iwatch. >> if all you have to do is push a button on your phone, -- >> or siri will say -- cap -- >> get me uber. >> here is adam with the movement on the market. >> not a lot of movement right now. s&p futures are flat. the euro is flat. crude is down ever so slightly. the one that catches my eye is

what you are seeing there on the two year yield. it is now trading at $2.52. >> and the pound is something we are watching as well. >> down about 6.5% over the past several weeks. >> this is bloomberg surveillance. we are on liver television, radio, streaming on your tablet, and atart phone, bloomberg.com. our twitter question of the day, what do you want to hear from president obama tonight? treat us. -- tweet us. >> i will be watching. if i'm still up. we get up a little early. >> your bedtime is normally 8:00. >> about 8:30 p.m. my socialite has taken a dive. but i'm an early-morning guy. economist,al

spaghetti is finally getting its way. a tax on the wealthy. joining us now to discuss it is brendan greeley, was just written about it in bloomberg businessweek. france and sweden have tried this. what happened? >> it did not work. it is really difficult to enact a tax on wealthy people. sweden started taxing wealth in 1911. and decade after decade, they .dded loopholes if you had for his holdings, they were not taxable. if you had equity in your own company that was not listed, it was not taxable. >> art, antiques, that sort of thing. >> exactly. more than 4%unt to of gdp. and when they finally got rid of it, it was 0.16 percent of gdp. the problem is, the people with money have enough power to grind these taxes down to nothing.

>> what specifically about this country was a good setting to try this? >> over the last 10 years or so, he has been working with a lot of economist in a lot of other countries to figure out what inequality looks like in various countries. we have a bunch -- a much better record of that family used to. columbia is one of the worst. >> for income inequality echoed >> and wealth inequality -- for income inequality? >> and wealth inequality. read thewyer did not article. this is critical. greg mankiw tears to shreds in the "new york times" all of the taxes we pay when we invest. we pay taxes only make the money. then we pay taxes on the dividend. we pay taxes on the capital gains. do you see any applied good news from what columbia -- what colombia wants to do?

but eventually, investors find investment. they go when they find the growth. --if it is not columbia columbia, it is somewhere else. >> everybody has got to join hands, otherwise the money go somewhere else. >> to have have to bring the have-nots with them. have to bring the have-nots with them. thecarlet, this goes around other countries as well. how can you set up this game serious the other countries don't participate? >> that is what it all comes down to. >> it's all just a communist experiment. >> [laughter] it's just optics. it means nothing. chief -- i spoke to someone at the royal bank of scotland yesterday. a tax on millionaires.

if you've got oodles of money, you can do something about it. house that has appreciated in value, you got some family savings, you pay the tax. >> it is an alternative minimum tax for rich guys? >> yes. >> what do you want to hear obama say tonight? i want to hear him say, yes, we have this problem in the middle east. we are doing tax reform for the next month. >> he cannot get that done, just like the whole immigration implosion. and the flop that he did between june 30 and last week. >> do your five-year-olds want to watch? >> we have not yet let them understand that ipads exist. we are keeping them innocent. >> what about the babysitter? >> [laughter] >> do you pay your five-year-old

and allow a? >> yes, but i tax the heck out of it. >> coming up, all things apple yesterday, it might be microsoft with the potential purchase of mine craft. ♪

>> good morning, everyone. i'm tom keene. with me, scarlet fu and adam johnson. what should billionaires do with their money echo part of it is social activism and political activism. some of that is the theme for betty liu this morning as she divvies up her millions and millions of dollars. >> and all of the billionaires that are watching bloomberg surveillance this morning. they all want to be thought leaders and a want to be thought influencers. it's not enough to have a lot of money these days, but you have to have a lot of influence as well. the billionaires list published by various publications, including of course, bloomberg. a new author, darrell west, has come out with his own billionaires list. he's publishing it september 18. and it's not bill gates.

believe it or not, the koch brothers are number one. >> and sheldon adelson, tuples are prexy is number four on that list. >> and sheldon adelson, too. >> he is number four netlist. he is number four on that list. and tom stier is number three. he said he will spend on the midterm elections to hold onto the met -- the democratic majority. >> what do we run of the tech stars like you think of good billionaires running around -- azillionaires running around spending money to influence? >> it's nothing new. power is the ultimate driver even more than money. money is the tool.

trying to do gates good in the world, or sheldon adelson trying to get an election tilted his way, they have a sense of what a want to see in the world. did you see in this? >> what i thought were interesting were some of the rankings that he had. instance, he felt donald trump, who was questionably a billionaire or not, we don't know, who is more pie you full -- who is more powerful than larry ellison, for instance. but it's all dependent on how you -- >> it all depends on how you define power. 200, 300 years from now. weather shuttle -- sheldon adelson moved one local race or even affected the national race on some level, i don't know if that is going to be the last thing, the hallmark of their -- july >> what would it be from

your point of view? >> i was looking at the top tenant -- inventions of all time, the wheel, the printing press. how about intimate -- innovating? how about solving poverty in large swaths of the population? the koch brothers failed to elect mitt romney. just remember that. >> we are going to discuss president know obama -- president obama and his speech on the islamic state. stay with us. ♪

>> coming up tomorrow on bloomberg surveillance with all what is coming up with geopolitics, this of course, after the president picks tonight. tonight at 9:00 p.m., and then on to 6:00 a.m. tomorrow morning with ian bremmer. with me are scarlet fu and adam johnson. moour guest posts are koyfman and tony dwyer. -- kickstarter, concerned others are

about negative trial it he changes. -- net neutrality changes. citye is opening a seven european tour imager it yesterday and is gathering viewpoints on a ruling that opposes -- said it opposes requiring it to gather information. sprint announces it will take smartphone trade-ins. that is today's company news from the files of bloomberg west. 2011, what is of that, three years ago? think $2 billion forward. gamers go crazy. it is mine craft. once they developed it, it is an keene on in the teen --

household. turn that off now. do your homework. microsoft may buy mine craft. once again, that is speculation. >> $2 billion for something your kids are addicted to sounds cheap. has cracked craft something with the audience. profitablecredibly company and microsoft believe they can turn it into a franchise. we will just has to -- have to see. i'm curious what their strategy is more generally. because --y especially because xbox was supposed to be part of their that form. -- of their platform.

>> that is their bread and butter, where they make all of their money today. although xbox has performed as far as other segments go. maybe this is a way for them to double down a bit more in an area where they have more success and to be a little more forward thinking. >> a are doubling down on anderman, who is more vicious than a zombie. >> i wonder if this is about microsoft running a way to use some of its offshore cash. >> there is absently no question that is what they are doing rather than repaving -- repaying for trading. you can do a lot with offshore cash. the question is, why this as opposed to anything else? defined in part by this deal and that it is an addiction in some household. is this sustainable? >> it is the gaming business.

it's like, our movies sustainable you are prexy last week and was the lowest movie attendance since 2001 -- our movies sustainable? >> last week was the lowest movie attendance is 2001. i don't know. >> there are always changes that hit the business. that is the thing you struggle with. it's no different here. we have seen gaming hits persist for some time. especially with these wonderful, bigger screened iphones, i don't think gaming is going anywhere anytime soon. >> do you look at this as a new microsoft? balmerization of microsoft? >> i think if they really want to make a play in gaming, this is the beginning for them. >> a great write up today on mine craft for those of you that need to get up to speed on

anderman and the unique physics. >> microsoft is only a 2.4%, is that wrecked? it seems low. >> it is low. >> let's expand the agenda. with the president speaking tonight, i think we have to expand the agenda. >> absolutely. we had some breaking news earlier in the hour on dollar general. dollar general now going hostile in its bid for family dollar. dollar has shunted aside their bit and decided they would go with dollar tree. and that is not happening now. they have offered $80 per share. >> and that is more than they competition. >> this is a change from 24 months ago. >> i will say.

talk about aggressively, eu foreign ministers are literally meeting right now trying to figure out how to -- o, i beg your pardon. someone was whispering in my year. that is delayed. the eu foreign ministers meeting is delayed. they are trying to figure out how to deal with sanctions. apparently this morning, petro poroshenko, the president of ukraine, has reported that two thirds of the russian troops have pulled back. mr. putin himself not admitting to that, because in. , there are no russian troops there. -- in theory there are no russian troops there. is continuing fighting in donetsk. they are unsubstantiated headlines, but there they are. backdrop thata the debates in europe are going into winter.

>> it is important. >> your agenda for today echo >> -- for today? president's speech tonight. not only will he be speaking about our military at risk as these airstrikes are presumed to continue, but the politics of a midterm election. do you believe the linkage of the markets into the midterm election? should we be a student of those elections? >> i'm a student of history. if you ask anybody today, we've never seen this kind of disconnect between the congress and the president. it seems so unique, right? the republicans impeached a sitting president when they impeached bill clinton. the internet was not around then, so you cannot google it. people forget that. what happens in midterm elections? the developing story of how you

will win the next election. >> here is a stat. strategic partners noted that going back to 1918, the midterm elections, the incumbent resident has typically lost six seats in congress. >> and this goes to pushing aside the walls of worry. you have been a resilient bowl through this summer -- resilient bull through this summer. >> following 1995, the was 1996.e market osama bin laden came onto the stage was a russia was battling the chechen rebels. and israel was attacking hezbollah on the west bank. very similar geopolitical events. similar monetary events. it is so similar. >> let's get to the twitter question of the day. what do you want to hear from president obama in his address

to the nation tonight? here are some answers. no boots on the ground, in other words. >> and phil mattingly making the case that you're likely to hear a plea for money. $2 billion for our efforts to strike from the air, and half $1 million for training of the other troops. >> here is another. that is asking for too much. and finally, a new era for all. >> this is tony dwyer. mo koyfman, thank you very much. and tony dwyer. tonight, on bloomberg

television, mark halperin and john heilman of bloomberg politics with their wonderful perspective on the president's speech. look for that at 9:00 p.m. >> betty liu is up next. ♪

>> good morning. it is wednesday, september 10. we are live from bloomberg world headquarters. i am betty liu.

you are "in the loop." i will speak with republican congressman mike kaufman in moments who serves on the armed services committee. what does he think about the president's speech tonight? ranking the most politically powerful billionaires -- rupert murdoch, bill gates -- none of them top the list. has mixedwatch reviews one day after its announcement. i will hear from the ceo of fitbit. president obama may expand airstrikes to include targets inside of syria. dollar general is going hostile forng its $9 billion bid family dollar stores to the eh