♪ there we go, a close to another trading week and another trading day. i want to bring in scarlet fu. also, our bloomberg stocks editor, michael reagan. let's look at where we are about to close here. just as we have got into the takenew moments, we have a turn down here. the s&p off now by 2/10 of 1%. the dow is lower as well. maybe everyone is closing their books out. scarlet: something might happen out of greece this weekend. >> that makes sense. volume is 20% less than average for the day. the big mover of the day was quest diagnostics after a tweet

of a rumor of a takeover. that tells you how little news there was today, other than janet yellen. betty: and how trigger-happy investors are. i hate to say anything reminds me of 2007. back in the day, when scarlet was training me, every day the market story was [indiscernible] it did not matter how bogus the rumor was. it tells you something about a bull market. profit growth is slowing. 2007, wherer to people of the takeover rumors. i think we will see more rumors like that. scarlet: you did have cpi. david rosenberg says if you go back to 1960, this has been the best gdp inflation backdrop. to 2%.flation between 1% the s&p 500 on average gains 15%

annually. he says right now this is a good environment for stocks, not so much necessarily for bonds. today.hat selloff >> partly in response to cpi data, showing inflation was coming in at a fast pace. this is raising a little bit of concern in the bond markets that they are going to hike this year and bond values could potentially lose. >> that is what her message was, 2015 is for real. >> for real. [laughter] >> she's not kidding around. she wants to keep the bond market honest. even though she did not really refer to that data. notemphasized the fed has been as successful on its inflation mandate as it has been with its employment mandate. betty: i was curious if she

would change her remarks according to the cpi. >> i think she does not want to get caught off on any particular data report. if she does, it sets a precedent. her job is to keep it at a high level and keep bringing other people back to the high level. scarlet: and say very little that could move markets. right before a three day weekend, if she had said this makes me rethink a lot of things -- oh, boy. it's a problem. betty: speaking of not wanting to move the markets, scarlet, you have data on how little the markets have moved. scarlet: usually mike and i would say, this is the biggest rise since -- it tells you about how nerdy we are. the smallest move for the dow jones industrial average in quite a while in terms of the intraday point swing. from peak topoints trough.

wednesday, 77 points. this is the longest such streak so for this year. don't expect things to pick up on tuesday, when we all come back to work. last year at this time around memorial day, it took a nine-day stretch before we ended this time period of not moving more than 100 points. you aree bond market much more volatility. vix, it hasat the been going down. if you look at the bank of america-merrill lynch, you are seeing it on the rise. it is 40% higher than it was during this time last year. there is volatility between the bond and stock markets. a lot of people are wondering what does it mean, what do you read into that? >> it is time for me to move over and start covering bonds, i think. it is a global index, right? >> it is treasuries. >> this is something the fed was talking about. they are probably encouraged to uptickick -- see an

because they are concerned about complacency. there is this technical discussion. it was short, but it was about a very technical topic called the term premium, why have long-term rates -- they still remain a low levels. is very concerned about the possibility of they might say the wrong thing in the markets will overreact. now you are headed back towards the recession. betty: do you think the fact the volatility has been reduced in stock markets, to some of that have to do with valuation, with earnings, what we have seen? what would be your interpretation? >> it's hard to pinpoint any real one catalyst for it. obviously the lack of disastrous moves -- news recently is part of it. owth of it is -- earnings gr has stalled. betty: down, right? >> it got a small gain for this quarter. forecast to be down for the next two quarters. scarlet: [indiscernible]

1.2 or around there was forecast growth for the current quarter. still pretty weak. the question is, the fed says this is a transitory slowdown we are seeing. a lot of the bulls believe -- it sounds cliche. pickup is what keeps a lot of people in the market. scarlet: the average earnings growth so far this quarter was 0.1% while sales declined 3.5%. >> some of this liquidity coming out of europe, we were talking earlier about the idea of bad news is good news. it does not apply to the u.s. so much anymore. it may be applies more in europe. >> to your point, while you are ,eeing volatility in treasuries still very much at play on the credit side in investment grade in high yield bonds. the woods yet. amount ofhave a huge

data coming out. we have got the revision to the first quarter gdp, new home sales. >> inventory entry numbers suggest we will have lower [indiscernible] betty: that is what alan greenspan was saying earlier this week. >> is going to be a much softer bounce. -- it's going to be a much softer bounce. betty: is any of that priced in? >> there is also the question of seasonality. a lot of people questioning whether all the first-quarter numbers back for a few years, how accurate they are. who knows when they will sort all this out? betty: everyone is making so much about the rise, recovery in energy prices. the increase we have seen in energy prices is seasonal. the run up is what we see every time this year. it has been smaller than what we have seen in the past versus the average, yet there is the story line out there that energy recovery is helping to drive the

inflation ideal, especially in europe. the fed is focused on the core measures. part of what contributed to the rise in the core was an aspect of [indiscernible] different to the fed's preferred measure of inflation. this was a different situation. with energy prices plunging so much at the beginning of the year, there was a concern they were going into freefall. there was a feeling of a lack of stability. betty: you mentioned first-quarter gdp revision. some of the other numbers, new home sales, durable goods, university of make it -- michigan consumer sentiment. all eyes will be on gdp at the end of the week. that is the number one question, how deep was it in the first quarter and what is the composition? it's really about the details this year, to figure out what

was the mix of growth. new home sales will get a lot of attention. existing home sales were week this week. >> in housing starts, it was a 20% increase? >> yes. mention the composition of growth. housing has been stronger this year. there are high hopes, and new home sales could be proof of that. scarlet: we will be extremely data dependent from here on out to june 17. retailers have reported. be fixatinggoing to on every little data point >> janet yellen said the -- even after we do the first hike, we will be completely debt independent. i love how she said it.

any forecast i make is going to be wrong. who knows if that one is right too. that was charming. betty: that was. there were a couple of moments where she was like -- i was li ke, she's a real person. scarlet: she paused and turned the page, to the economy. [laughter] we have the labor report as well in the beginning of june. betty: that is one big data point as well. >> the stakes are only ever higher because the question of the labor market, was it a harbinger of more weakness? scrupulously avoiding the topic. the many you look at janet yellen's comments today, they were talking out of both sides of her mouth, there are signs of weakness, signs of strength. the take away is that the fed does not want to get wrongfooted by the data. they do not want to make a call on hr and -- a trend. >> did you get the impression she was very interested -- she

seemed to talk about slack in the labor force and people working part-time. i have not heard them give a u6 employment number they would like to see. it is still above 10%. looks at more granular items like involuntary part-time, labor force participation. she went into significant amount of detail. >> i want to work part-time, but they won't let me. [laughter] betty: on that note, josh, mike,t -- scarlet, lisa, much more ahead on "bloomberg market day." ♪

betty: welcome back to the "bloomberg market day." the bank of england taking a look at potential risks.

britain's renegotiation of its european membership -- senior markets correspondent julie hyman had that story from the breaking news desk. earlier today "the guardian" reported it had received an e-mail. mistakenly, it looks like, from the bank of england saying it was exploring what would happen if indeed britain does decide to leave the european union and in particular, the currency. prime minister david cameron is planning a public vote on eu membership by the end of 2017. this news came out, the newspaper said he would be potentially embarrassing for the , and the bank of england came out with a statement saying, there are a range of economic and financial issues that arise in the context of the u.k.'s planned referendum, the project which is known as project book and, the boe said it should not be a surprise.

a little bit of damage control here being done by the bank of england. interesting that it is preparing to examine further nuts and bolts, how would it work, what would the effect be? betty: they would be remiss not to. it is rather strange the way it has come about to people's knowledge. thank you so much, julie hyman. for more on today's market trade, we're joined from boston by a chief global investment strategist with charles schwab. before we get into talking about your views on the markets, what did you think of yellen today? guest: there is not much to make of it. she is right to dismiss a lot of what has taken place here, the softness of the economy, as transitory. one of my favorite things to look up is the citigroup economic surprise index for the u.s.

it has been plunging this year. it has plunged in the first half of every one of the past five years, bottomed in the summer, and picked up again in the fall, suggesting economic data disappoints in the first half and surprises in the upside of the second half. that sets us up for an october rate hike. betty: so you remain bullish? >> positive on the market for sure. we are still in a backdrop where equities are the place to be relative to fixed income. we have increasing m&a activity. that is taking shares out of the market. buybacks continue. even if the individual investor is not a big buyer get of stocks, they are creeping back in. institutions still are. earningsu know that are in fact -- you've got to take energy out of it here -- earnings are falling, right? >> that is true. we have seen earnings decline, not just in the u.s. it is true in europe and asia.

the question is, what is causing that, and is this another three-year pause in earnings growth like we saw after 2008 or 2011. when i look at these companies and what they are saying, i am the porteather, strike, transitory factors that look to be turning around. maybe already some of those factors are beginning to recede, or we might be on the cusp of a return. betty: how do you know those transitory factors, that ceo's are appointed to, are not masking bigger problems at the companies? >> i guess we don't know for sure. as a look back to the other two earnings downturns, on a , they wereasis talking about these types of factors. they were talking about a big drop-off or a surge in inventory levels. we are not hearing or seeing that this time around. we are seeing an environment

that is maybe a little bit softer and exacerbated by what we saw with oil prices. betty: what do you make of the decreasing amount of volatility in stock markets, particularly vis-a-vis the bond market? it has become a market that is simply traded by governments. we don't have the same type of participants in the marketplace anymore. liquidity is thin on the individual side. with so many central banks participating in these markets, dampening the volatility, it is not a place where we find a lot of that anymore. it is being forced to other parts of the marketplace. i do not think that is unusual. it seems like there are many that are institutional marketplaces. betty: what is most attractive to you right now, jeff? >> i like what i'm seeing overseas. they are seeing growth pick up. when thing i would like to bring

-- onehis trade deal thing and would like to bring up is this trade deal. that is a big win for japan. japan has 20% of its trade with countries it has a free-trade agreement with. to 40%.l expand it it could get to 70% by the end of the year, a huge plus for japan's manufacturing sector. betty: we will see if the senate approves it later today. jeff, thank you. much more ahead on "bloomberg market day." we are discussing the fight for global equality. "thebrown on his new book, glass closet, why coming out is good for business." ♪

betty: welcome back to "bloomberg market day." voters in ireland deciding whether to legalize same-sex marriage. theion polls suggest government backed favoring gay marriage will be approved great john brown, the former chief executive at bp, spoke with onomberg this morning "surveillance" to discuss the progress of global equality and what it means to be openly gay in the corporate world. i still think i score at five point something out of 10. the glasses definitely half-full, not half empty. movements which change the way people look at a i think, constant vigilance is needed to we see great things happening. fantastic movements on gay marriage, equality of marriage

in the united states, in europe. but yet, for example, when i tried to distribute this book in regarded as to controversial to be sold. >> it is societal and you lived it and everyone knew you were living at within a huge containment. browneou have been john 30 years ago now? john: no. what i did then was fit for purpose then. it was not right, but i had to do it. i recall discussions on succession for people to senior jobs. they would say, that might be a bit risky. he, after all, has gone through a divorce. things have changed so much. you can't change today to yesterday. >> it is so hard to figure out when something has changed. the anecdotal evidence that is so powerful, you have this beautiful story you wrote about

giving a book lecture at hanley and having a couple come up to you. middle-aged couple come up to me, very nice people, and they took a book and gave me a book and said, we would like you to sign this to our son because we would like him to come out. that is the tables reversed. kids' parents getting kids to come out. it's easy to talk about. i'm worried about the guy in british petroleum whose employee number 84,322. what is your view on their opportunities and visibility in 2020? book isat is why this still relevant. it is about setting tone and making sure you have role models to look up to. until recently, people could look around and say, if i come out -- [indiscernible]

role models are important. corporations have two really want to have inclusion and protect people, make it safer than to be themselves. >> when tim cook came out of the closet, how much did that change? there are still only i think four openly out ceo's of publicly listed companies. what changed when tim cook came out? john: very important. mosts leading the world's important corporation. it changed people's views that you can in fact have a gay leader, and a successful gay leader. betty: that was the former bp ceo, john browne.

watching for "bloomberg market day." have a great weekend. we will see you tuesday. ♪

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♪hey girl ♪we're having a party happy birthday, grandma! ♪we'll be swinging ♪dancing and singing ♪baby come on over tonight emily: is uber charting its course to an ipo? be getting a $1 billion line of credit. i'm emily chang and this is "bloomberg west." coming up, a sublet fight in san francisco. whatlked to experts about the trend means about a possible tech bubble. the senate works into the weekend debate the controversial n in thet would rateign in fight.