the bond route continues. the german 10 year meals 1% -- and there's 1%. tomorrow is jobs day. will a constructive jobs report lead to further education? opec leaders meet in vienna. this is bloomberg "surveillance," we are live. june 4. we have a huge news flow. brendan: things are more happening. it is fun to get up at 3:00 in the morning when things are happening. tom: futures -13. can we have a fifa-free day. brendan: i was planning on it. there will be some trials and it will be fun. tom: we will try to get through a fifa-free day. vonnie: the global bond route

picked up pace. german bunds falling for a fourth day. the yield on the 10 year bund up after mario draghi forecast inflation and warned investors should get used to volatility. another round of talks was not able to break the stalemate over greece. alexis tsipras rejected proposals that would have unlocked a bailout funds. tsipras says only realistic proposals are on the table. the only once there are the ones his government came up with. the ceo of one of europe's biggest lenders, barclays, forecasting a last-minute deal. mr. jenkins: when you look at what is going on in you and greece -- on the eu and greece there's a negotiation.

past experience shows there is generally a solution found albeit at the 11th hour. my money would be on that happening in this situation. olivia: -- vonnie: greece is scheduled to make for payments to the imf. when asked if greece could make the payments, tsipras responded do not worry. in china, crews have cut into the hull of the ship on the yangtze river. only 14 people were rescued. dish network's charlie ergen reportedly taking aim at another mobile carrier. dish is in talks with t-mobile u.s.. now word on what the price would be. according to "the washington journal," john legere would run the company. an american he used to be a top

official at fifa recounted years of kickbacks. in 2013 in a sealed courtroom, chuck blazer said he and other officials agreed to take bribes. the transcript of the hearing was just unsealed. blazer pleaded guilty to racketeering charges. brendan: a little fifa. tom: two minutes and 48 seconds fifa free. brendan: chuck blazer, what i have heard is that he is hilarious. tom: the guy with the beard. brendan: the most disarming people are the most able to use these machinations. i'm being told to move on from fifa. tom: could he go to jail? brendan: yes. tom: serious stuff. brendan: the morning brief is serious. 8:30 nonfarm productivity

numbers. 8:30, initial jobless claims in anticipation of jobs day tomorrow. 9:45, weekly consumer comfort index by bloomberg. there were gains all last year that have not looked as good in 2015. tom: a little tippy. ellen was fascinating with morgan stanley. a data check. futures catch up with the bond route -14 on the s&p. dow futures -1.13. the euro goes through 1.13. oil churns. let's move on. vix 13.66, that will adjust this morning. euro-yen a euro story. this is not global in nature. much more this is a euro-centric

story. we did not to 1% on the german 10 year, zero point 99. 0.96 is a massive adjustment office trading desk. let's go over to the monitor to see a little bit of explanation. this is bonds in 1991. here's the depression, here's the great deflation paul volcker. this is the moody's baa. just to show history and the huge agitations. what is it? eight out of 90 interviews smart people say 1994. on a long basis, here's the ugliness of 1994. bring it down here, we are nowhere near the ugliness of 1994. vonnie: explain why you chose

corporate as opposed to treasuries. tom: a longer series. my longest full faith and credit is back -- vonnie: it looks tame if you go back further. so much money was wiped out. tom: the bond markets like this and agree markets are like this in size. brendan: i would like to see volume in the chart. one of the things that happened was as more data became available we could do more with them. tom: let's do the chart. we've got to go to london. it is not a bond route. you are leaning forward listening to jonathan ferro. when somebody asks you why this

is going on, what is your answer? what's the why of lower bond prices. jonathan: two stories, the global bond rout and what is happening in europe. the global bond rout is policy normalization. the european bond rout is overextension and crowded trade. you saw in q1, the capitulation of the remaining -- 0.05% on the 10 year. the global bond market story is one story, europe is another. the question i would ask is how long will the ecb tolerate that? tom: we are going to talk, and a lot of confusion about yield and price. these are priced charts which you use when you move. we've lost 8.4 years of german coupon in six weeks.

eight-something percent of price and the yield is only 1%. 8.4 years of clipping your coupon. brendan: i'm aware that things happened on paper. i want to talk about this "ft," mario draghi pointing bund yields up with his finger. what does the financial ferro say?is this due to comments from draghi? jonathan: get used to volatility is different from get used to 100 basis points up. you can have swings in prices but a backup of 100 base points is different. everybody talked about draghi's comments on volatility. he had a comedy about monetary policy accommodation. i think that is the story down the road. does he really want to fight the

bond market? a backup in yields is the big story. brendan: i find it instructive that not yet have you said the word greece. jonathan: trying not to. as far as the bond markets are concerned, and the midst of the global bond markets -- i don't think it matters. tom: the headline for american viewers waking up is equities futures -13. can they catch up with currency and bond? juncker had a good headline. draghi moving the euro stronger. we've got another leg up. vonnie: the euro of trading at 1.1349. apart from the imf payment, we have nonfarm payrolls. tom: the jobs report as well.

jonathan ferro, thank you so much. we will catch up with you tomorrow. japan is about korea, germany is about poland. he knock on effects of what jonathan ferro was talking about. plunging ten-year bund price instantly felt around the world. she speaks around the world anastasia amoroso is a global market strategist at j.p. morgan. it was range bound, now it is not. are you surprised? anastasia: i think everybody was surprised with the magnitude of the rise in the 10 year. tom: don't worry, stability and everything will be fined -- baloney. anastasia: two reasons the yield rose. first was expectation and the second was a technical reason and lack of liquidity in the bond market. vonnie: is this sustainable or a short-term move?

anastasia: episodes of volatility do not last. a 10 year, 20 year timeframe, usually an event causes the volatility to spike. eventually the tide recedes. i think about is the situation we are in. the second thing, if you look at prior instances of quantitative easing, the fed, the boj, every time they start quantitative easing yields declined. shortly thereafter they start to rise. inflation expectations rise. brendan: anastasia amoroso with us for the entire hour. our twitter question of the day. has the bear market started in bonds? tweet us. this is bloomberg "surveillance, good morning. ♪

tom: good morning. bloomberg "surveillance." frequent data checks. futures negative 13. vonnie: the fbi says a terrorism suspect in boston was planning to kill police officers. the suspect was killed tuesday when he threatened officers. officials say he was planning to start knife attacks that morning. a relative accused him of -- a sale at general electric. ge couldn't almost it commercial businesses in the u.s. on the market. the ge is selling units. speeding up plans to upload most of its ge capital business and focus on manufacturing. in hockey, chicago came from

behind to win game one of the stanley cup finals. two goals in the final 7 minutes to beat the tampa bay lightning. game two is saturday in tampa. tom: no canadian teams, they are u.s. teams with a lot of canadians playing. there is parity. there is a possibility -- these are greatly matched teams. if you are just waking up markets continue on the move. anastasia amoroso with us with j.p. morgan. a really interesting chart. thank you for bringing up the work of angus maddison.

you are a college grad you need a job, 1-800-deloitte. we talk about employment, the spirit of employment across his america. brendan: volume, volume, volume. the choice the opec countries indiana and -- in vienna. ryan chilcote is at that meeting. there are two stories, iran and iraq. ryan: that is right. the iranian story is simple. the oil minister is here. the international oil executives have been here as well. to meet with the iranian oil minister because they want to get in when sanctions go away. what is different as we are learning they do not want to get in for the sake of getting in, they want to get in for a good deal.

it is not necessarily going happen. they want productive sharing agreements and the iranians are saying that is a no go. there's a battle when it comes to iran, not just getting rid of sanctions but finding a good deal for oil complex. brendan: help me understand the production sharing agreement. ryan: an oil company comes in and they get to cover their costs with the money made from production. and they share that with the country. that is really good because it is an insurance policy for the country. the russians hated it in the 1990's. it is most likely they will get with the iraqis have, a service contract. they pay companies a certain number of dollars per barrel to extract oil. they say it is too risky. brendan: traditionally in these

meetings in vienna, what happens is some but he says something and everybody looks at saudi arabia. his saudi arabia the decider? ryan: very much so. this is really still a club of gulf countries calling the shots . more specifically, it is saudi arabia. they're the ones that dictate policy at the last meeting and are expected to dictate policy at this meeting. they are happy with the way things are. tom: every time you are in vienna you are always in some fancy hotel with a fancy chandelier. what is the back story this time? i want to know the back story at these meetings. ryan: everybody is pumping like there's no tomorrow. the saudis are pumping, last

month they pumped more than they had ever pumped. the iraqis, we keep hearing about islamic state and the horrific picture. the iraqis are pumping like there's no tomorrow. pretty soon, the iranians will join the party. tom: does anybody there all the fancy people, do they agree with ed moore that oil could break under the $40 price? ryan: if they believe that, they are not publicly talking about it. they like the demand picture. they say the global economy is improving. dollar is going to weaken, that should be good for oil prices. brendan: ryan chilcote in vienna at the opec meeting. coming up, chicago's booth school of business' richard thaler. his new book the "misbehaving."

streaming on your phone and bloomberg.com. tom is reading the book. ♪

tom: good morning, everyone. futures -13. they have improved a little bit. the 10 year yield, 2.39%. bond yields moving more than we saw yesterday. let's get to our morning must read. brendan: animal spirit takes us to china. the financial times writes that euphoria has sent china's stock market. the authorities are in a trap. the more they leave things to

market forces, the more the economy slows, obliging them to step in. anastasia amoroso with us. i looked at the shenzhen index, up 137% this year. what is driving that? anastasia: liquidity. liquidity is coming from two places. first is the investors being able to access mainland shares. we talk about you 40 maybe it is not fully there yet. the utilization of the quota is not actually at 100%. that is the first pillar. the second take filler is the -- big filler is the liquidity from pboc. determined to deliver 7.5% growth, they have to deliver growth but not inflate the

bubble. vonnie: is the state happy with this? valuation increases help state owned companies. anastasia: there's the wealth effect helping the economy. the chinese government is careful not to inflate the bubble. the way to do this is to back regulations. tom: what is happening on trading desks? i think they can trade for fullface and credit. what do they do for a taiwan? is it like the old days? pick up the phone, hello, are you there? anastasia: it still is very much on a negotiated basis. tom: it is still somebody going hello. brendan: what are you doing? vonnie: using a tin can. tom: it is really important.

when market gives away equity or bonds, there's always a seller. there's got to be somebody on the other side of the trade. where are the bond buyers? anastasia: bond buyers are not there. the bond buyers do not step in overnight. they are insurance companies, pension funds excited about higher yields. brendan: it is the morning of debt and central-bank policy. the ecb pushes ahead with eb mario draghi picks up the phone, alone. janet yellen, when she is going to tighten. ♪

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tom: correlated with bonds and equities. let's get to our top headlines. vonnie: the global bond about has resumed in the germans and is getting pummeled. the boone fell, they had their worst two days. bonds slumped after that it shows that europe's inflation is picking up. mario draghi was warning that markets should be prepared for higher volatility. the bonds have erased all of these years gains. the prime and mr. of greece is saying we do not want your economic reform, ours is the only one that counts. he rejected proposals that would have spun out bailouts. he says the only realistic proposal comes from his government. recently develop money to reverse.

forget about plans to cut oil output's, the talk at the open summit what -- the opec summit was about iran and iraq pumping more oil. iran is urging opec to make room for more oil i sanctions on iran are eased. the former head of research is producing $40 oil by the end of the year. the ceo of uber marked its fifth birthday by talking about mistakes, it does it has made enemies with its progressive style, but says it is part of the growth process. >> i can come up as a fierce advocate, people have said that. [laughter] i also realized that some have used a different a-word to describe me. i am not perfect and neither is this company. like everyone, we make mistakes. but we are passionate about

learning on them. vonnie: uber operates in 58 country and more than 300 cities . the nba finals get underway tonight in oakland as the series that does the two highest profile players, steph curry and lebron james. both teams have first-year coaches. a huge year for one of those coaches. tom: i am not into basketball and i am into this. brendan: lebron taking cleveland to the finals is a beautiful thing. tom: we could go an hour on the headlines. brendan: i was thinking about uber, what happens when they get the mapping service, what else can they become? tom: i want to mention the bond route of yesterday, catherine mann is a wonderful economist at brandeis, she said one single

sentence, europe is doing better. i am sorry, much of this is a good news story about a europe. vonnie: they did not raise forecast yesterday. brendan: anastasia amoroso is making noises like he wants to talk. anastasia: a good european story, but the reason why we say we want to invest in european equities, yes mario draghi wants volatility to not create a one-sided trade position, not to say to investors, you can invest in safe haven bonds and you will make money, he wants to crowd investors into a riskier position. not too much so there is unwanted typing. tom: what is critical is your expertise on knock-down effects, everybody focuses on japan. warsaw is riveted on berlin. what will be the outcome to the

emerging market world within all of these major central-bank actions? vonnie: the biggest -- anastasia: the biggest worry that the fedal reserve raises the short-term race and the money emerges out of the markets . this is not 2013. a lot of the emerging markets have better real rates and high foreign reserves. tom: i still go back to the vice-chairman of the fed stan fisher, he knows what happens if you ignore emerging markets, he learned that. brendan: he is part of the argument within the fed about how much attention you pay to that, hard to figure out whether they are paying attention to foreign markets. tom: stan fisher is. brendan: janet yellen says we are aware of it but is not part of our decision making. i want to go back to the idea that a little volatility can be a good time, did i read you correctly, what you are saying

a little bit of a tetra prevents an explosion -- 10 from prevents an explosion? anastasia: that is right, mario draghi does not want one-sided crowded positioning it to a safe haven german bund. the statement from the conference yesterday volatility breeds volatility, which happens when you have crowded positioning, the reason we had the short and higher is because these positions had to unwind at once, as volatility picks up, you have to reduce your risk. brendan: is the fed watching foreign markets? anastasia: yes, because, there is always knock on effects, not just eurocentric. tom: the average tenure, the yield is up 146% in the last number of weeks -- that is a tantrum. let's bring it back to america. major shout out to peter scheer who is with us on bloomberg radio. bring up the chart.

this is like the roulette wheel of people playing in the bond market. pete scheer just said tom, shut up and look at the chart. bond prices are stable, no they are not. this is the beginning of the crisis, long duration, more volatile paper appeared on the right side, this is rolled over with a price way down, but nothing like where we were in that government -- is america going to go government? vonnie: why wouldn't they take advantage? tom: somebody is taking a loss this morning. vonnie: i was looking at the irish 10 year -- to year at .002%. -- the irish two-year at .002%. brendan: i would not put ireland in that same list, ireland has extracted itself from the periphery. tom: anastasia with what we

have observed in the last two days, with a change the actual behavior of fed governors presidents, and the chair? anastasia: that is the key question. i do not think it does. because for the federal reserve the fact that the 10 year notice at 2.3%, it is not -- if you think about it, they are easing all across the yield curve, they have low short-term rates, low short-term rates and you were saying how does this impact the curve, what mario draghi is doing in europe is implicitly easing the policy here. the fact it has tightened a little is not a bad thing for the economy. it prolongs the time during which they have to raise those rates. brendan: watching the response to mario draghi and reading about how mark carney is

changing the way they communicate, the structure of the meetings in the u.k. how much central banks are still learning how to committee kate. -- communicate. anastasia: it is an evolving process, mark carney has been the leader in foreign guidance -- forward guidance, but it is an evolving process. all the central banks are in tune with what is happening in the financial markets, they want to know how investors are positioning and what the after prices are reflecting. if they know that, they can control that with communication. look at yesterday, and mario draghi's communication. vonnie: angry at himself -- brendan: that is the story of the morning. it is our twitter question, has a bear market started in bonds or is there more to come?

coming up, we are going back 200 years with the economic data looking at share of global gdp, china, india, u.s., we will take a historical view. this is "bloomberg surveillance." ♪

tom: good morning. for you in global economics and global markets, must watch, much listen, in our next error, richard thaler, his fabulous new book is usually controversial, he takes shots at rational economics, we are thrilled to have richard fowler with us for the entire hour -- not the entire hour, most of the hour. misbehaving is the new book. a single best chart. another economic giant. brendan: slide deck all week, we are taking a look at a long-term series that goes back to the 19th century the percentage of gdp that each country has of -- excuse me -- we will talk about it. percent of global gdp. it does not add up to 100%.

we took a couple of reasons out. the u.s., china, and india. in 1820, the u.s. did not have that large of a share of global gdp. then it you see india and china going back last night, tom was talking about india -- the wealth of the sultans, that declines over the early 20th century. most economic it has this modernist field, pretending nothing happened before 1910. the story of the 20th century we have arrived at a point where the u.s. and china has an equal share of global gdp. vonnie: why is this important when you could look instead at average gdp? tom: she loves to do this chart every year angus madison's work is controversial, but to brenda's point, this goes back

to the cycle of nations. we have a fear that china is equal to america and yet, all of us know that is not true. are we deceived by a chart like this? anastasia: what it gets correctly is the directional change. there is no doubt the chinese economy has expanded by leaps and bounds. if you step back and see what has driven the expansive, hot relation growth, total activity increases, that has been the case for the united states. the third thing is urbanization. that is why china needs to see that 7.5 gdp growth, because they have to give the incentive to boost the organization -- urbanization rate, which now is 55%. brendan: it explains a lot more about culture than economics. the u.s. was coming from nowhere, had a tremendous population growth, settled the west, the story you see in this chart. china was coming from somewhere, you see a long bit and that make

-- a long dip and that makes it understandable to see where china says this is where we will be again. anastasia: the five-year plan we increase the quality of life for the chinese consumer. everybody is angling for that spot. vonnie: time for the top photos. number three video, it marks the 26th anniversary of it tiananmen square protest. in 1989, hundreds died after china's comment's party sent tanks to disrupt democratic protesters. a candlelight vigil will be held today to commemorate the anniversary, more than 150,000 people, the only place where a commemorative like this takes place. brendan: these photos almost did not make it out of china, the photographers had to hide rolls of film in their rooms, switch

them chinese authorities went hotel room to hotel room looking for exactly this. tom: whatever you do this summer, go to the met to relive this, in the basement of the met is a 1968 red guard uniform, part of their magisterial china exhibit. it is in a corner, like an afterthought of all this fancy stuff. it is deeply emotional to this film to see the red guard uniform. brendan: the film is amazing what you do not see is as the tank tries to move the man moves back-and-forth. he does not let the tank go. vonnie: in japan godzilla has been named the country's new tourism ambassador. the ambassador says she was not available. godzilla received residency papers come his official duties include drawing visitors from

around the world and watching over the kabuki neighborhood in tokyo. a producer was telling us each precinct has its own mascot godzilla is a good one. no one has any comment. in taiwan, a new trend, owners are trimming their dogs for a few geometric shapes, the idea was to give pets a clean look and have them stand out. salon workers a dogs are not hurt. what do they know? tom: let's have anastasia way in. in manhattan, these little bark-bark dogs going down the street. do you want to go the geometric way? anastasia: i have one of those dogs who just about got the haircut. brendan: is that doggie mascot of this prefecture? vonnie: do you have more

autographs -- photographs? tom: we will come back and discuss your metric poodles when we return -- geometric poodles when we return? new weakness in the s&p, stay with us. ♪

tom: good morning, everyone. markets on the move, equities bonds, currencies, all moving today, u.s. futures at -14 right now, the euro 113.56. could we get to a 114 handle. vonnie: the race for the white house gets more crowded, jeb bush tweet said there will be announcement on june 15. the speculation is he will announce he is running. former texas governor rick. is expected to try for the republican nomination for the second time, the ap says he will announce today. former rhode island governor and senator lincoln chafee is running for the democratic nomination, he will target hillary clinton over her vote to authorize the iraq war. the unit jack ma was take

advantage of the frenzy for share sales in china, he will raise $1.6 billion i selling new shares. the shell -- the sale -- shares of alibaba pictures are up 145% this year. want some of those with that burrito -- some booze with that burrito. beer, wine, and mixed alcohol freezes will be out for at one of the change -- will be offered at one of the chains -- they are a cell out the hall and restaurant in south korea, spain. -- alcohol in restaurants in south korea and spain. brendan: i had too much taco bell in college. no amount of alcohol can get me back. tom: they work consulted by lloyd -- they were consulted by

the deloite. the smart people who been auditors and accountants everyone else has been out of the street, this year is different, and college graduates , it is different for the employed. a change is in the air. no better place to observe this then the world of auditors accountants. the headline is this is the real deal, as the cfo, interim ceo finally, it is the real deal. >> we are continuing to hire. it is competitive. tom: what about existing employees? >> their finding other opportunities. the economy came back. they are leaving more than they

were three years ago, but we are finding a lot of highly qualified people and we will hire 25,000 people. tom: i think of the medical industry, the lead for facial industry, when you go into a meeting or having a strategy meeting on hiring 3000 other 20,000 new hires, do you just assume a higher wage? >> yes, we do. i do not think it is as high as people think it is going to be because there are a lot of people looking for jobs. brendan: close to half a generation did -- spent their 20's looking for something. when you do your hiring are you hiring straight out of college or looking for people with more experience? >> about 50% out of college, 50% experienced hires. the trend has been a more experienced hires over the last several years, but it has split a little bit and meet -- we are

moving back to the college student. vonnie: how long can so many remain unemployed before they are unemployable? >> that is a great question -- i do not know if we look at it that way, we look at what experiences have a hat and are they still relevant to our clients. brendan: we have anastasia amoroso -- she wanted to jump in. anastasia: we see the job hires are not at all time highs, is there that mismatch between jobs available and the skill set available? >> in some industries, yes, and no may always be in some industries. we are finding that, if you have a cyber degree security, a consulting and technology, if you can do cloud computing, you will get a job, for auditors, you will get a job. brendan: colleges in the washington, d.c. area are specially -- specializing in that.

the fellow that manufacturing around the country, slightly down, in your kansas, when you send your auditors around the country, where our conditions the worst? >> the worst? we have a big practice in federal that is down and has been down or a few months, a few years. for us, the technology, retail life sciences, continues to be outstanding. tom: you provide guidance to executives on the tone of their annual reports, what is the tone from ceos around the country when you they speak to their shareholders in the next go around? what will they be saying? >> the tone will be, we have come off a pretty good year in 2014 and we think we are going to have a great year in 2015, maybe more modest than we thought initially appeared signs overseas of weaknesses and it will be more cautious that it

has been last year. tom: thank you so much. let me do -- anastasia wonderful to have you here thank you very much. let's look at the foreign exchange dynamics, euro two days in a row, up, call it the draghi move. the euro is strong, a euro 140 .90. ♪

>> this is "bloomberg surveillance." tom: the bond route continues, the german 10 year nears 1%. tomorrow's job day in america, will it lead to further agitation in bonds and equities? we speak with richard thaler on the this behavior of you being rational. this is "bloomberg surveillance." live from new york, it is thursday, june 4, joining me is brendan greeley. brendan: i am looking at a report from merrill lynch. the effects on qatar should they lose the world cup would be small. tom: we are trying to do fifa less and less today. right now bank of england out

with our breaking news. they maintain the purchase plan acid expected. -- as expected. governor carney will not have a press conference as we saw with markets moving yesterday. bank of england, sterling -- headlines this morning. vonnie: the global bond islam is deepening, the seller has a raised this year's gains. german bonds falling a fourth straight day. a forecast of faster revelation by the president of the arabian central bank, mario draghi warning investors to be ready for market volatility appeared no deal in the greek debt crisis despite another route of high-level talks, the trimester is rejecting a proposal from european lenders.

he says his government plans are the only realistic proposals. berkeley expect a last-minute deal -- berkeley expects a last-minute deal. >> it was a process of negotiating happening at the moment. past experience shows there is generally a solution found, albeit at the 11th hour. my money would be on that happening in the situation. vonnie: greece owns a lot of assets and owes payments to the international monetary fund totaling $1.7 billion. asked if greek -- rescuers in china cut into the hole of the sunken cruise ship and no more survivors were found, more than 400 people may have -- -- have died when it capsized, most of the victims were elderly and only 14 people were rescued. this network is reportedly in talks with t-mobile u.s., the in

negotiations are in the early stages and no word of price. the word says t-mobile's jon lester would run the happening while charlie ergen would be the chairman. an american who was once a top fifa is recounting years of corruption. in secret testimony chuck blazer says he and other officials agreed to take bribes for choosing south africa as a world cup host. the transcript of the hearing was unsealed, he plan guilty to racketeering, it is believed he cooperated with prosecutors. you guys are signaling. brendan: so much bedtime reading in soccer. tom: what are you focusing on you are watching this. brendan: there are not many new ticks. the fbi will move forward and start to pull on the threads and see who else gets pulled in. tom: do you know what coca-cola and these that get -- and visa

been? brendan: visa said blatter was not enough. nonfarm productivity numbers and we get initial jobless claims, and we take a look at our weekly bloomberg consumer comfort index. tom: look for coverage on bloomberg television and radio beneath the headline data. the data is ugly equities catch up with the bond route, -14 on the futures, euro strengthens it is relatively new highs for the session, 113.63. oil turns -- onto the next screen -- the idea of the vix at 13.66, look for that to be an even 15 handle this morning.

all of europe and the german 10 year almost got to 1%. a great introduction to hans nichols. moments ago, someone said draghi will ignore the bond route -- how can the institutions you follow ignore the market signals? hans: because they cannot do anything to control, mario draghi said get used to it except volatility. it does not mean a bond route, but in some ways it makes his job easier when he is looking to buy up these bonds that was the concern three months ago, there was no market that was liquid enough to buy a bonds. people are selling them, maybe he will have an easier time buying $60 billion a month he wants to purchase. brendan: we had anastasia amoroso from jpmorgan tell us a little volatility is a good thing. is that what you are hearing?

hans: we have close to 1%, and that is a headline? shouldn't it be they are returning to normal ranges they are giving money away in berlin for people to buy second, third and fourth homes. a remarkable story when you look at how well interest rates are does it translate into investment, that is the big question. tom: very quickly, where is christine lagarde this morning? hans: i should know that, i do not know. tom: no one knows. brendan: -- hans: maybe she is looking at the greek of london numbers. unemployment payment at 25.6%. they had to revise upward, but well north of a quarter, and

that -- we talk a lot about citrus -- cuyprus. tom: thank you, so much. we needed to find you the perfect guest for thursday morning, she is the head of u.s. rate strategy bank. taking a global view on u.s. equities, dairy pricing at all assets. how do you define a bear market? we know 18% bear market in equities, repeat after me, what is the equivalent in bonds? >> the tantrum is closest. we do not need another one, this is repricing, if you look at fundamentals, during the tetra tech from, we had good data

good growth numbers. the first quarter was week. we have been waiting for the second quarter rebound. interest rates have risen. i would look at the equity market, it has not performed well. you had people moving out of bonds into equities, we are not seeing that. brendan: the one thing you keep hearing over the last two weeks, the word liquidity in the debt market. is this something you are worried about? >> significantly, we had regulation over the last few years, particularly in the last year or so, that has worsened the liquidity conditions. and treasuries and bonds. i worry about what does it do to bonds. it is a risk-free test if a risk-free asset is not liquid it will have repercussions around the other assets. a coronation of assets high-frequency not one thing

you can control. tom: richard thaler will join us within the hour, another giant from chicago in india, he wrote the book fault lines about these interconnectedness, where is your fault line? >> i focus on the bond markets that is where the fault line is, if you get interest rates to rise significantly or the wrong reason, because of liquidity because people are nervous around how much net supply. tom: define the faith in credit 10 year yield, where do you lean forward and i'll -- and say we have a problem -- 250 or higher? >> 250 or higher is a concern. vonnie: we are at 2.3%. tom: 11 basis points away. brendan: isn't that -- isn't a

liquidity saying that -- >> if you look at the real money, the pension funds, the insurance companies, they had means to buy. that is another issue. we have been underestimating the impact of the dollar. a much stronger dollar today having an impact on the economy. a lot of studies are based on the last 20 years when we are not as globally connected. brendan: we plant it perfectly our twitter question of the day -- has the bear market started in bonds? are we having a tantrum? tweet us. good morning. ♪

tom: good morning, i am tom keene with brendan greeley. brendan greeley is not running for republican president candidate. brendan: i am the only one. it is about to get more crowded. jeb bush sent out this tweet, he is expected to formally announce

on june 15 in miami. former texas governor rick perry later today will announce he is running. not a surprise. phil mattingly joins us and he is not running. help me understand the transition. candidate jeb bush, i will put close around candidate -- quotes around candidate. phil: technically he is still considering whether or not to run. the biggest secret will be jeb bush is declaring for president. i was talking to a few folks, the point has been, he wanted to get his feet wet in this process. this was also an opportunity to raise money through his super pac setting him up to make a move. tom: help me out with whatever the numbers, 18, 19, 20 candidates running, the biggest

thing to me was the way florida and the powerbrokers change the florida primary. will we see more winner take all discussion as we migrate through the summer? phil: the florida primary, the winner take all, and moving the primary to mid-march poses a lot of interesting questions for jeb bush and marco rubio. if you look at the polls, scott walker, the iowa poll from earlier this week, scott walker at 17 points, that is an area where he is the front runner. how people positioned themselves in the early states, primarily jeb bush, who is struggling in iowa, as they look toward florida, if you are jeb bush, 90 plus delegates if you win that. wherever you are in the race, florida can make or break you how they plan early state strategies to get to florida it will be interesting. brendan: last time around, the

republican primary cycle was a clown car, with a avoid that this time? phil: the rnc work hard on the debate structure and primary structure. this is a deep bench, a lot of things will play out over the next couple of days. tom: thank you, so much. using the phrase seething resentment for income equality. coming up, a wonderful treat, the president of the --richard thaler will join us. stay with us ♪.

tom: i promised you more data check, futures -14 now -13. 10 year yields, 2.3%, the bond market continues to move up. let's get to our top headlines. vonnie: the fbi says the terrorism suspect was plotting

to kill police officers. he was killed tuesday when he threatened officers who stopped him. officials say he was planning night attacks on police that morning, a relative is in custody accused of blocking the investigation. bloomberg news reporting a major selloff i general electric company they are putting most of its u.s. commercial loan businesses on the market the 20 billion dollars assets sale includes railcar and franchised financed units. the company wants to unload is capital business to focus on manufacturing. the blackhawks rallied to draw first blood in the stanley cup playoffs, chicago scored twice in the last seven minutes to beat tampa bay. game two will be in tebow they on saturday -- in tampa bay on saturday. tom: i hope it goes to game seven. i am sorry for stanley gita, go

blackrock -- stand with you to -- markets on the move. carlyle group copresident will join us. as the bear market started in bonds, we will do all that this morning. here is the single senates from the book i love -- woud ld amos approve? the book is "misbehaving." important whether you agree or disagree. amos diversity, a founding giant of the police that models and mathematical certitude flat out did not explain the past and the present of our certainty. it was way overdone coming out of the nastiness of world war ii and in the past decades from

rochester to chicago, richard thaler has been a staunch defender for the certain crew as he said no, uncertainty matters. thrilled to have you -- did you stay up and watch every minute of the blackhawks? richard: thanks to you guys, i missed the third. trying to get beauty sleep. tom: bring up the quote. the reality of what you do at the booth school at the university of chicago, one thing the nba's learn in the business goal is to think like an economist, but they also forget to think like a human. another example of theory induced blindness. are we smarter than we were in the nascent days of behavioral economics? are we wiser in our certitude and uncertainty? richard: we are wiser because we

are less certain. i say in the book that the rational models are fine, we need them. tom: we need bob lucas? richard: because they prevent best present a framework we can dismantle. the market hypothesis, nothing wrong with studying it it is necessary, the danger is believing it is true. tom: i hundred percent -- i 100% agree with what he just said. you have to study the certitude to get to the uncertainty that is there. vonnie: bank of america-merrill lynch, our bond market investors being rational? >> the rates will rise another

20 basis points. does it make sense to jump in? vonnie: how do you analyze them? richard: i am far from an expert in the bond market but why is anyone holding bonds is a mystery to me. quakes a great -- >> a great this first vision asset -- diversification asset. richard: why i should pay the government to hold my money is not clear to me. brendan: the great point in american politics is to see who gets to write the economy -- economics 101 textbook, has your work made it yet? richard: where we are is most economics 101 textbooks have a chapter saying by the way there is this other way.

that is where you start. the economy 101 text books are about 10 years behind the leading journals. tom: i want to focus on the words i circle. i hope -- i hate the word code and fair -- hope and fair in economics. one of them is the certitude of risk and uncertainty, what have you learned from the financial crisis? how are you different from where you were in july of 2007? richard: in some way i am the same as greenspan in the sense that i was worried, he wasn't, and we both moved in the direction of realizing just how bad things can be. we were both surprised, him more

than the, that people in the financial sector were not paying enough attention to counter-party risks. tom: the book is misbehaving cannot say enough about the controversy, the good controversy about it. we will talk with one of the great meetings of 20th century economics, stay with us. ♪

' back to world war i, here is a depression, that great reflation out of world war ii, runs out of patience and down we go. i am going to use the bloomberg terminal in the bloomberg mouse to cursor in and soon out 1994. this is a chart, all you have to know is that the length of the aero matters and if you bring it down here, we are nowhere near 1990 or bear market, are we? >> we are not. the fed is a very different place. grow is very different inflation expectations are different and i think 1994 is an extreme example. even at a 2013 level, are we going to get a basis -- tom: i want you to talk about the bond hysteria this morning. how do you calm them down?

>> number one, we talk about fundamentals. the market can dba but is this an opportunity when the market gets nervous we can sell up 50 basis points? i think people who can withstand a little bit of can think about potentially bind yield. it is very risky head of payrolls. brendan: what are the fundamentals? >> inflation expectation if you look at the entire movement, they have been flat. they have not been rising. second-quarter growth is not rebounding as much as we thought it should. the consumer is not spending. the job market is dead and oil prices are lower, why is not the consumer spending? i was a productivity -- why is it not picking up? you know, i look at growth and we are not in an environment where growth is slowing. u.s. looks the bet that are they really rebounding at the point where they can handle the percent? -- 3%? tom: we go back to earlier that

10 is -- >> i would say 250 -- tom: i would say to 50, right? >> i would say to 50 where the dollar where it is. tom: looking at the bloomberg terminal, this headline came out. global basis, that was brilliant. thank you so much. let's get to the top headlines. vonnie: as we have been thinking about the global around the world's deepening and german debt is getting pummeled. german 10 year bonds excel again and they had their worst two days since the euro was adopted. funds slowed after data showed them picking up in near. mario draghi is warning investors to brace for the bond selloff that has already erased all of this year's game. greece is telling we do not want your economic reform and ours is the only one that counts. at a meeting in elgin, tsipras

rejected the bailout that would unlock the funds. he says his government plans are the only realistic ones. greece needs the bailout to avoid default. despite the global oil, apex are hoping at pumping more. the iraqi oil minister says his country will increase express this month in iran is urging opec to make room for more oil. opec former head of research predicts oil will slow to $40 a barrel by the end of the year. the ceo of uber marked the fifth birthday by talking about their mistakes and one or two of his own. he knows they have made enemies in style but he says it is part of the growth process. >> i can come up as a fierce advocate for uber. people have said that. [laughter] i also realize that some have used a different "a" word to

describe me. i will be the first to admit that i am not perfect and neither is this company. like everyone else, we make mistakes, but at uber we are passionate about learning from them. vonnie: uber operates in 58 countries and more than three hundred cities. the nba finals starts tonight in oakland, cleveland versus golden state. m.v.p. steph curry of the warriors against four-time m.v.p. lebron james of the cavaliers. golden state took the only title 40 years ago. cleveland has never want it. it will be a big one. tom: i am looking forward to it. i am more focused on the black hawk champion but this will be great. brendan: who is happiest at the nba? tom: exactly, they get about five times the ratings. hockey does great, particularly in canada, but nba really usurps them in terms of audience. as get to a data check. a big day to do that, futures at -14.

that is about -- well, they have improved, -11 right now. we add from the fear of one hour ago. i will state that now. at 30 year bond, 3.11% shows that on an export, if you would, the big 13.66 waiting for that to close higher as well. brendan: this is bloomberg "surveillance" i brendan greeley with tom keene. tsipras this is a great moment -- tom: this is a great moment in economics. three decades, the behavioral crowd, and they were young, they took on the giants of fashion expectations in a packed chicago auditorium, richard thaler and a skinny kid from yale had to go up against robert lucas. giant george stigler sat in the cheering section ready to throw popcorn at this.

it was just like the cubs against the white sox. it was also a window into a dead serious debate and it continues to rage today. today could be john cochran and baylor, whoever. why does this debate raged between the behaviors and the massey guys? >> well, i think everyone is reluctant to change. you know, one of the mistakes we talk about all the time on economics is people fail to make -- a knowledge cost. economists are guilty of that too. if you spend your life building models of the original -- a fictional creatures of the smartest economist, you are reluctant to give them up. tom: what do the new kids tell you when they come into chicago or even into the school? there is a new breed coming in. are they failing nights or look

at nights? -- are they >> -- >>it is not controversial if you are under 40. i have not changed a single person's mind. all i have done is corrupt the youth. you know, there is an old saying, science marches on funeral by funeral. we are going to win, meaning our fields will disappear and economics will become as behavioral as it needs to be and it will not be by convincing my buddy, it will be by convincing the current grad students. brendan: you write in your book that you were surprised that behavioral economics rose in finance for not microeconomics. what is left to be done in the field of macro? >> everything. i mean it is we learned anything from the financial crisis and it is we know nothing.

just think about what we are trying to figure out what to do with greece. there is no consensus of modern economists whether greece should be applying more or less austerity. you know, how basic family get? brendan: specifically to that, i was stunned to see the island was retooling -- the imf was retooling for more homogeneity and that means different people react different late to the same economic stimulus. it is shocking that that was not part of their assumptions. >> you know, the basic problem is if you write down a mathematical model, the easiest one to write down is one where everyone can -- is the same and they are really smart. if you start to allow for headed originality and some whimsical missed -- whimsicalness, things get hard. tom: when you listen to talking

about unknown unknowns, i want to go back to the london school of economics and artistic lives in -- and into stigler it about the things we do not know. do you have a renewed respect not for what we can observe and fancy academics can do or market economists can do, do you have a new respect for the step we simply do not know that is out there? >> it is not a renewed respect. i think we know far less than we think we do. tom: particularly in the media business. it works great. richard: you know, the media is really good at confident predictions that they forget about the next day. pria: you say we should think like a economist because that could make the world a better place. richard: not necessarily because people we study are jerks. they never make any contributions to charity and will steal from you if they can. brendan: real people are a lot

nicer than economists give them credit for. tom: the cubs and white sox graphically do, cubs and white sox? richard: cubs. tom: the book, "misbehaving" and i cannot say enough. richard, stay with us. futures at -11. ♪

tom: 12 hours away remembering penniman square. the 26th anniversary. this of course is in a different part of china, not only culturally but in terms of financial and economic society of the nation. 26 years ago, tin and inman square and the view of hong kong. good morning. bloomberg's "surveillance" and looking for to the next hour. brendan: carlyle group overseas $193 billion in assets and yet they still have catching up to do in real estate. see with carlos president and ceo is here right now. do they feel a little behind and sad? erik: it is hard to feel sad for anybody in the private equity industry but after talking to carlisle, i kind of feel sorry

for carlisle because the comparison between carlisle and apollo or kkr or tpg when it comes to real estate and the blackstone group is inevitable. remember, blackstone got the only call from general electric's when ge wanted to unload $23 billion of real estate assets. they did not call carlyle or any of the other guys, so i wanted to know -- brendan: you are making private equity sound like high school. erik: on a date? brendan: go ahead. erik: it is kind of a date i guess. didn't really work out that way but here is what glen duncan had to say about what it is like to compete with blackstone in the real estate business. >> i think there are some real estate businesses and our competitors that blacks and have a wonderful real estate business. they right now are very much the standard of industry that people talk about. i don't think that diminishes the performance of our real

estate business at all. i am 66 and when i stand next to my kids i look really tall. when i sent next the washington wizards, i look really short you know. erik: that is what it is like. a 6'6" guy walking out onto the hard court in the presence of the washington wizards and going, oh, no. brendan: is this where the money is left to be made in real estate? erik: real estate is a good area to be making money because returns are better than they are in a number of other places. real estate is a hard asset and you can look at it as being better protected from some inflationary forces than other kinds of assets. stocks, certainly bonds. tom: what are you going to do in the bond market this morning? erik: we have andrew from pimco coming on. we will be spending some time. tom: that is really a perfect guest to have. no question about that.

markets on the move been a little bit better than we were earlier. i guess i can go back to the depths of the market at the euro. up two days in a row but not like it was 90 minutes ago. brendan: like, "market makers" coming up next and they have lisa on and they can talk about liquidity and what it actually means, who has it and who does not have it. "market makers" will also bring you the conversation with glenn young king, the president and ceo of the carlyle group. he does not feel as tall as he should feel. we should feel sorry for him and we will coming up next on bloomberg television. good morning. ♪

tom: here's the top, to be tough deadline this morning. that is the bond markets are not as ugly as two hours ago. with that said, pages that -14 --1120 real top headlines. here is vonnie quinn. vonnie: there will be another republican officially running and looks like jeb bush will join june 15. the former florida governor hinted on twitter that he will make an announcement that day. rick perry will reportedly try again and the associated press says he announces his presidency

today outside of dallas. the former texas governor was the front runner in 2012. alibaba cofounder once to get in on the frenzy for sales in china. he plans to sell shares in the alibaba picture group that could raise more than $1.5 million. here -- shares or rdf 145% this year. taco bell is letting customers washed down their burritos with booze. and you location in chicago will offer beer, wine, and drinks called mixed alcohol. it is the first for a chain in the u.s. taco bell in south korea already sells alcohol. tom: we go right now to an expert brendan greeley. brendan: i love chipotle and the real problem i have a talk about is that my freshman year at tulane, the mail car could buy tacos that tackle bill and i took advantage of that. i think that is not over for my

lifetime. tom: very good. let's look forward into the 8:00 hour. stephanie and erik will go to vienna. they will speak from vienna -- dish and t-mobile and their pending possible may be merger. and one of the interviews of the day, andrew balls will speech with -- will speak with erik schatzker about this bond slop we have. we will continue that discussion right now. it is claims day, the day after adp day and after liberal and jobless claims have been positive. other data, not so much. pre-emmys for has a real job, -- pria has a real job and talking about losses and bonds. you made us much smarter.

let's link finance into the economics of the jobs report and janet yellen will interpret it. are the markets out in front of the job's report and out in front of janet yellen? pria: i think this move has not been about the fed or growth. the market still pricing in the hike in october. i think tomorrow is huge for that. if you get a 300,000 number which is not what we are forecasting, but you will get a huge rebound. i think the market will move. our goal is to 20 which is right about consensus. i think even to 20 is showing that the job momentum still follows which allows the fed to -- i think 220 is showing that the job momentum still follows. vonnie: you know, you see the consumers stalling out a little bit, productivity, we get that today, but the pm eyes yesterday not so good. priya: i think the fed is trying to make a distinction between left off and if you get a 220

number it is enough for them to start. i do not think they are going that far, so we can have a very short hike cycle which prevents setting off a lot. if you look at average earnings tomorrow, i think that will be imported. you get a nice solid pick up for the next few months and that they embark on a normal hiking cycle. vonnie: if the number picks up at the wage gains do not this fed will raise in perhaps in september, you are saying? priya: yes, but it might be very low. tom: that is the first time in four years i have heard that mentioned on sex, a great relationship of labor. brendan: three have a -- i have heard that mentioned on set, a great relationship of labor. brendan: two we have a nweserd alert? given all these other metrics we are looking at activity growth.

priya: the market is actually reacting more to the jobs number. i think market is right because the fed brings a lot of attention to the job number. their mandate is full employment and by stability, they seem to have stability because wage inflation tends to be somewhat of a lagging indicator but the job's number is the coincident leading indicator and the market is moving a lot more on any surprise, jobs number. tomorrow, if you get a surprise, i think you could be in for another big one. tom: what is positioning right now within full faith and credit bonds? is there still of that of lower rates or is there a massive bet that we go the other way? priya: i think the leverage community cannot sit on loans. the hedge fund community, i think, is much more neutral

perhaps short because they had been negative. the real money and asset management community, i think it is too long because you look at all the fundamentals and it does not really augment. tom: this is critical. there really has not been a catharsis of this pullback or any other pullback. there has not been that sweat. have you felt it on your desk? i have not seen it. prirya: i think that is when you see the white of the eyes. if you get a good jobs number that is when you will get some of that. tom: 250? 240? 270? priya: 270. vonnie: at the beginning of the summer, it made a bit of an impact at the time and that impact -- hasn't gone away? does it matter if it is 60 billion? 65 billion?

the problem is we heard it from mario draghi and the market heard from in ecb official heard it in a strange way. priya: it was a probably what mario draghi says, he just sort of ignored it. he did not talk about frontloading, he did not talk about the fact that high interest rates which is a problem for europe and he said the whole bond selloff in europe was technical. i think a bond investor at 75 basis points, i don't know if it makes sense to own bonds because it does not look like -- vonnie: ok, what we are going to have to go to tom. due november 1994? do you -- do you remember 1994? samuel jackson was ordering -- brendan: i was an intern where they were discussing fiscal

union. vonnie: why didn't you tell them? vonnie: continue this discussion with michael. we continue with our twitter question of the day, we ask if the bear market started in bonds? bond markets are drying out. i would not say -- brendan: it has been fun to start watching the bond -- bund. priya: have you actually -- we actually found the global correlation much higher which is interesting because what happened the last years or four years on who is more important for treasury, i think there are theories to why we have become more global. brendan: more evidence that -- vonnie: i don't know. the second answer once again

once the commotion dies down, we are buried in dead presidents. brendan: we get that answer pretty much every day. vonnie: third answer, investors seem to have an appetite for risk. usa is doing well. brendan: again, we got those revised numbers yesterday and they said europe doing much better than the u.s. comparatively. vonnie: i know you have got plenty to say. b we are looking at -- brendan: we are looking at bonds and nobody is going to panic, we are not going to see the whites of anybody eyes unless 270,000 comes out as the job number. vonnie: rick perry has made his 2016 presidential campaign official. he is making a statement outside dallas at 12:30 pm eastern time. you know you will want to listen in on that. brendan: i talked a little bit to his campaign since this is the last time around, and he will not hold a sarah palin. he has been working very hard to build up on national --

international relations. i am looking at the dish and t-mobile merger. it has to do with spectrum. they have to figure out what to do with it. thank you very much for joining us today. "surveillance" will continue on radio and "market makers" is next on bloomberg television. we will watch the bulletin price all day. gutenmorgan to you. ♪

>> im erik schatzker. stephanie will be her momentarily. a lot of stories to make sense of this morning. another potential telecom deal and new bitcoin regulations. a new busy day indeed. the time now is for top stories at this hour. there is word this morning of a possible blockbuster deal in media and telecommute stations. the wall street journal reports dish networks are in talks to -- with t-mobile. but the final company would look like, the price and how the -- trading up in the free market. a sale or general electric, bloomberg is reporting ge is putting all of its commercial loan businesses in the united