day. discuss a market take on this latest greek move. deferschristine lagarde interest rates until the first half of 2016. the ball is in janet yellen's court. >> and why this campaign will be different from rick perry's last one. scarlet: good afternoon, everyone. i am scarlet fu here with alix steel. good friday eve, everybody. we are looking at a pretty steep selloff across the board, but off the lows of the session. 50-day around that moving average, which a lot of traders -- scarlet: just about two points

below that level right now. this all started with christine lagarde coming out earlier in saying the fed should wait to raise rates until 2016. her twost putting in cents, just a recommendation. let's look at how treasuries are doing. bonds initially extended their losses. scarlet: you saw prices higher, yields lower. that is the case in the u.s. and in europe as well. the 10-year, yields 84 basis points. alix: highest level since october for the u.s. 10-year. scarlet: already? alix: kind of crazy. and oil accelerating to the downside, with the opec meeting. of had the ex-opec head research saying the brentwood stay between 40 and 50, a considerable downside. they do not expect them

to do anything. alix: will they raise the quota? this is the question. scarlet: they did nothing. alix: it was crazy. alix is psyched. let's look at the stories making headlines this hour. deferring and offered to bundle the payments into a lump sum payment. the country is now waiting for the imf to reply. they have about $1.7 billion due to the imf this month. this comes after another round of high level talks, but they have been unable to break the stalemate. alexis tsipras rejected proposals from european lenders that would have unlocked bailout funds. he says the only realistic proposals on the table are the once his government came up with. only country to delay

payment -- zambia. scarlet: ooh, not good company. alix: just saying, greece and zambia. --f but higher rates could >> higher markets rate could have circumstances that go well beyond u.s. borders. in weighing these risks, we think that there is a case for waiting to raise rates until there are more tangible signs of range or price inflation than are currently evidence. , we believe words that a rate hike would be better off in early 2016. alix: to make matters worse, the imf cut its u.s. growth forecast for the second time in three months. they said the dollar was moderately overvalued and if it gets much stronger it would be harmful. in a statement the imf says the

datac should remain dependent and efforts first increase in policy rates until whichare greater signs of are price inflation than are currently evident. alix: that -- scarlet: that is a big if. the field of republican candidates for president is growing. rick perry in the race for a second time. rick perry: it is time to create real jobs, to raise wages, to create opportunity for all. to give every citizen as stake in this country, to restore hope, real hope, real hope to forgotten americans. sent out ad jeb bush tweet urging supporters to attend an announcement he is making on june 15. he will reportedly announce he is running for president.

alix: the house of representatives is unlikely to vote on the fast-track trade bill until the week after next. it would allow president obama congress with proposed trade agreements to ratify or reject, but not change. house speaker john boehner hopes to get the bill on the floor in the next few weeks. that's look at our top stories at this hour. scarlet: coming up on the bloomberg market day stash a a high cost for specialty prescription drugs. banks unloading $20 billion worth of assets. which units are poised for sale. scarlet: and t-mobile in talks with the company. all of that and more coming up on the bloomberg market day. alix: tomorrow is the big day. we have the jobs number, monthly jobs number.

the weekly jobless claims are at a 15-year low and the unemployment fiction or appears to be looking brighter, giving the fed some vote of confidence that the labor market is on track. let's did deeper. we are joined by john from la salle network. ok, good to see you. guest: what is your -- alix: what is your take? guest: we are not going to talk about the blackhawks? both: no. guest: the one area that people are not seeing -- wage growth. that is what everyone is looking for. where is wage growth? i think we are seeing basic economics. when you have a shortage of things, companies will pay more to get that. we do not have that. seen a shortage of jobs that companies actually need? visa issuesve h-1b

for technology -- alix: those are blue-collar though. guest: there is a blue-collar /white color discrepancy. you want to pay more to get your house cleaned? you want to pay more for someone to fix your car? but you want to make more money. i think we seeing that a little bit with the race and the minimum wage. we are seeing that morning service industries. there is an antiunion sentiment in this country right now from white collar america. there is a huge divide people do not want to talk about, especially during a presidential primary. alix: a big part of your businesses hiring temp workers. what is the conversion rate for a temp worker to a permanent worker? guest: that is a big thing we look at as an indicator for the economy. permve lots of temp to

changeovers. when the economy is booming, they bring someone in for a pure temp job -- a month, two weeks, and in you pay a fee to buy them out and bring them on. we see that increase. scarlet: do you see more demand because you do not have a need to provide health insurance, and therefore people who might have been working for permanent jobs are more content with contract work? guest: they have still got to pay it, so that's the difference. likee aca side, a company mine, we do pay a good percentage of the affordable care act for the employees. a lot of companies do not have that. there is psychologically a sense of i want to be attached to a corporation. i do not want to be a contractor. on the other side of it, i want to go to the highest bidder and make as much money as i can. technologyat within

do you see that end? app development. programmers, engineers -- scarlet: high level salaries? guest: high level salaries. scarlet: so they are mercenaries essentially. tox: what would ceo's need see to turn on the spigot and hire more people? guest: they are doing the intelligent way. alix: this is really good? guest: it is great. look at the profitability, the cash on hand companies have. doingmpanies are not poorly. what they are doing as they are spending their money in a more conservative fashion. wen was the last time that looked on our ipad tablets and read there were huge massive layoffs? alix: all the time? guest: aside from the oil industry, how often -- scarlet: there was an article in the new york times this week about disney, for instance.

laying off workers, outsourcing -- and they are bringing in the h-1b visas to fill those -- that is they are bringing in skills they do not have in america, too. there's a big asset there. it cost money to bring people and within h-1b visa. it is not a free thing they are doing. and you have companies -- it's not just about trying to avoid paying benefits. scarlet: but you lower your cost base. ishiring indian workers, it a lower salary. guest: who says that is a bad thing? scarlet: the people who don't get the jobs. guest: we are a global economy. if you are going to do something in your house -- scarlet: i look for the quality worker. guest: it absolutely does. ifyou do that oversee is -- the work product suffers, now we

got a problem, but if they found a global solution to lower the prices, it is up to the citizens look in thetry to merrin, i've got to get better skills. i also brought up banks. we have seen banks cut thousands and thousands of jobs. think the financial services and what you have in new york is a monopoly. i am a firm believer we should look at a lot of things in the united states is geographically separate. what is going on in new york and the rest of the world -- it's different across the board for everything. scarlet: new york is not charlotte, in other words. alix: but banks are global. scarlet: there is much more we could say on this. alix: we are going to base this on the break. tom gimbel, ceo of lasalle networks. coming up on the bloomberg market day, former texas governor rick very announcing another run for u.s. president on these same day that jeb bush

tweets the likely date to announce his candidacy. ♪

scarlet: welcome back to the bloomberg market day. alix: let's go to julie hyman at the markets desk. on this down day there's been a lot of action. julie: there has been a lot of action. i want to look at the s&p 500 chart. we have seen selling accelerate as the day has gone on. the dow and the nasdaq are down about the same amount, 1%, but if you look at the trajectory of

the s&p, the selling has accelerated as the day has progressed. if you look at the s&p on my bloomberg terminal you see your to date, we have now fallen through the 50-day moving average. do we have that? there we go. we have fallen below that level today. all that means essentially is a momentum indicator and by this momentum indicator, we have fallen through that important level that could mean -- if you are a technician -- we could be poised for more declines. something to watch if nothing else. we have seen the acceleration in the stock market. it's important to see what is going on in the bond market as well. we are seeing actually the bond market go in the opposite direction. bond routen this around the globe that came to a halt. you can pin it on different things. you can say, did it have to do

with christine lagarde and the comments she made about the federal reserve. we have heard traders say they did not pay that much attention. they were just hitting an important level after all that selling and now there are buyers perhaps. 2.3% on thet 10-year, coming down quite a bit. also want to look at the dollar. right now it is trending lower, very little changed, but i did want to mention something that christine lagarde talked about, and what she was the overvaluation of the u.s. dollar. there is one way to measure it. index. the big macs you look at the currency and divide by the u.s. dollar. if you look at my bloomberg terminal, you have that valuation. the big mac index for fitting currencies burress -- versus the u.s. dollar. all of these other currencies, at least by this measure, are

undervalued versus the u.s. dollar. if you look at it by this metric, there is some potentially something to what christine lagarde is talking about today. and as we know, of course, -- the dollar and has been on quite a run. interesting to look at it using the big mac. switzerlandure agrees. thank you so much, julie hyman. now for a look at the top stories crossing the terminal at this hour -- regulators are fuming over that takeover bid from last month. etsy has filed a claim. avon shares rose 20%. a crazy story. the global oil glut. pumping moreaq oil. the iraqi oil ministry says that

they will increase exports. why opec's may be former head of research is predicting $40 oil by the end of the year. have a three-amy and her study on the effect of fracking on water pollution. it has contaminated some drinking wells, but the impact is not widespread. the agency also says the controversial drilling technique could affect drinking water of safeguards are not maintained. fracking means that chemicals are shot into underground shale formations to free natural gas or oil. the industry lobby groups feeling very positive, very validated. on the flipside you have natural resources defense council coming out and saying, there was a lakh of data. the epa lacked key data to assess it safety.

this sounds like it will show up in a movie or tv show. alix: maybe matt damon. also, does fracking does earthquakes? scarlet: meantime -- alix: talk about never-ending. in a 2012 deja vu, former texas or rick perry announcing his candidacy for presidency again. it is time to: reset the relationship between the country and its citizens. we need to return freedom to the individual. his chances to clinch the nomination may be better this time around. here to explain why, mark halperin. i know alix's takeaway is he has different glasses. mark: the glasses get a lot of attention. .e made a lot of mistakes

people hold that against him. but if you look at the history of republican presidential politics, old faces are good faces. you look at people who won the nomination in the past, with the exception of george w. bush, the son of a president, nominations in the modern era have generally gone to someone who has run is one of only three people who has run on the rubble inside before. bush tweets today, urging supporters to sign up to attend an announcement he is making june 15. i think we all want to know what that announcement is, but kidney already announced announce? is already running at this point? k: he has been about the most aggressive on announced candidate. when they reveal how much money he has raised as an unofficial candidate, has are going to turn and eyes are going to bulge. some would say it is beyond what

the law allows, but you would say if you are not a declared candidate that she's not so different from the others. a lot of people do politicking without announcing. i am flapping away a little bit of an insect here. [laughter] halperin, thanks so much. make sure you tune into "with all due respect" with mark halperin and john heilemann. a little bit of bug spray. i think this does dovetail with what we were talking about. modern republicans have become a dangerous endangered species. this line shows where they are making -- becoming more conservative while house democrats have remained relatively flat. they have moved to the left, but not as much as the house republicans have. and 90% are moderate in

the house. you do not get that from the rhetoric. i'm glad you found the chart. scarlet: maybe this data shows that they have not gone so much. alix: we will be right back on the dow selloff. ♪

scarlet: this is the bloomberg market day. alix: thanks to two blockbuster sufferersatitis c have access to a surefire cure, but the cost is going up. drugser: why do new cost so much? the simple reason -- because they can. drug companies usually look at fewting diseases with competing therapies, which gives them monopoly and pricing power. for instance, take this all maier squib kick's or drug, the

first new medicine approved for approvedeatment of -- for the treatment of advanced melanoma in more than a decade. $30,000 per injection and the treatment course is for injections. --ther reason for high cost drug companies try to make as much money as they can on medicine before the patent runs out. once the patent runs out, generics injured the market and prices decline. research is another driver a price. on average it takes about 12 years for a drug to go from preclinical research to market. in the u.s., the fda requires new drugs to go through three phases of clinical trials before it can enter the market. timely and costly and most drugs fail. for the drugs that do make it to market -- companies will look at and pricerugs

accordingly. this means the prices for a category of similar drugs may rise together. for example -- a drug used to multiple sclerosis debuted in 1996 for around $10,000. it was similar to a drug that came out three years earlier. both drugs now both cost about $60,000 per year. when some one asks you, can you really put a price on your health? the answer is yes. scarlet: fascinating -- fascinating. you can read the whole story in the new edition of bloomberg businessweek on your mobile devices, newsstands, and the web. we will be right back. ♪

alix: welcome back to the market day.

i am alix steel. los angeles is on its way to becoming the biggest city in the with plans to gradually raise the men waged to $15 an hour. it is not a done deal. an initial vote by the city council passed overwhelmingly, but another vote is necessary because it was not unanimous. mayor eric garcetti endorses it. and aaa is going all natural. they are removing artificial flavors, colors and .reservatives from it menu it will change subway sandwiches and will be implemented gradually over the next 18 months. will they tasted different? they kind of all taste the same now. fromface competition chipotle, both chains that healthy. he of their menus. apple says all but one of its watch versions shipped within

two weeks when they were ordered in may and some models will go on sale in stores. general motors is struggling in china. the automaker is reporting sales pricess despite cutting on 40 models. 4% from a yearto ago. it was mainly due to a changeover and the phasing out of older models. that is a look at our top stories this hour. scarlet: coming up in the bloomberg market day -- ge banks to divest assets. why this move is being made. on t-mobile stock rising reports it is in talks with dish network. down to theounting u.s. closing bell, 30 minutes from now as we look at the

triple digit fell upon the doubt. all of that and more him on the bloomberg market day. it is the big story of the day. lagardeector christine schooling the fed on when to raise rates. christine lagarde: with financial stability consequences that go well beyond the u.s. borders. in weighing these risks, we think that there is a case for waiting to raise rates until there are more tangible signs of rate or price -- wage or price inflation than are currently evident. so, in other words, we believe that a rate hike would be better off in early 2016. alix: joining us now to get their reaction to the bond market, george, the head of interest rates at nomura, and lisa abramowicz, probably the hardest working reporter right now at bloomberg news.

george, when you saw the reaction in the bond market today, it sort of seem like a pause in the selloff. or a reversal? george: it is a pause. well,rket is not trading but i do think it is kind of interesting. it took someone from the imf to of thethe trajectory market. it took someone from left field. anyone going to listen to christine lagarde. the fed is not going to sit there and say, yeah, do what she says, guys. does it affect the long-term outlook? lisa: it probably increased the chance of the fed hiking in december. initial jobless claims are holding up. fundamentals can be interpreted as better. exactly, -- exactly, they stabilized

earlier in the day and the european markets are following that. how itmuch with had to do with her words per se -- there was some central bank support -- mario draghi's real uncomfortable comments. get used to it, guys. have you seen the yields up 1%? that is crazy. george: that's not typical. you are right, the move to the fed hike could have taken place, but the selloff is an long-term rates. whenever the selloff is an long-term rates, eventually they flare out. has rates at zero, basically. we are close to normalizing policy, but until they do, we have this thing called the stock market which is of being the circuit breaker to the bond

market. -- : how is that george: if it comes under pressure, eventually it will affect the corporate bond market and the equity market. we have a circuit breaker in the bond market. most people do not want to hear you have the financial trade and that will impact capacities. lisa: george, how worried are you about the correlation, the increasing correlation between asset classes. alix: and to the dollar and oil. depending on how you see that at the end of the day -- george: when the market straight up one, that is one of those economist type signs, right? we don't like to look at that. .e look at differentiation

the fact that things are starting to become more thislated ends up being idea of the nowhere to run, nowhere to hide. there is this alternative that people like to talk about. these gyrations in the market are not ultimately healthy. it is doing the fed's dirty work. long-term rates rise faster than normal. it fed does not care how gets there, it cares how fast it gets there. alix: have we actually seen massive amounts of selling? is there literal movie moving from one asset to another? it.: i'm not seeing maybe somebody else's. there was money going into debt past week. this was against the notion that there is a mass exodus, and one from what ig -- and

am hearing on the street, some investors look at this as a buying opportunity. the question is can they buy, especially inside. alix: what might be the catalyst ? what happens to the catalysts? george: going back to christine lagarde tro comments earlier in the day -- although i do not think it is the driver price action today. when the fed starts to drain liquidity, you saw this happen tantrum.e taper i think what christine lagarde is kind of thinking about, if the fed raises rates and the market overshoots, it could impact other countries. i think it's all symbiotic. there's only so high the market yields can go. -- when isgot to say

going to be the right time? we have been looking for the right time forever, haven't we? blackrock is using this. it is the chicken and the egg. alix: that is the question. thanks for joining us. george, lisa abramowicz, no doubt the conversation will continue. general electric takes one more step shifting to an industrial company. a key part of the transformation is to shed its finance arm. according to people familiar with the matter, they have plans to unload $20 billion of assets in health care -- care. joining us to talk about ge's rick, whosale, follows the company for us for bloomberg news. this really caught my eye. this is an enormous shift for ge, which is basically a bank and wants to be an industrial company. what assets are going down. they are in the

process of selling off most of their financial assets, actually and just recently they have hired thanks to sell off their health care finance business along with their franchise finance and railcar leasing businesses and those three businesses are about $20 billion in assets, which is certainly not small, but probably more significant is that with this, they now put essentially all of their u.s. financial assets on the market. at least those that we know they're going to sell. alix: who are some of the buyers for these assets? reporter: none have emerged yet. trying to sellso off their private equity lending ant and apparently investment board is in talks to there is element

financial, in talks to try to acquire. alix: in the meantime, how does ge manage? it's not a full-fledged industrial company, so it cannot compete with its industrial peers, but it is shedding is finance arm, which really has been the revenue driver for this company over the last decade. reporter: it is a major shift going on. they really are trying to refocus on their industrial businesses area they are really focusing in particular on a couple core lines, including power generation and the jet engine unit and even the oil services equipment. alix: unbelievable. thank you for putting that in perspective for us. reporter: thanks. on the bloomberg

market day, dish network and t-mobile could be a potential merger. we will discuss why this would and would not make sense for the companies. ♪

back to thee bloomberg market day. i am alix steel. 15 minutes before the closing bell. we are looking at a selloff that is accelerating. the dow off 1%. julie: all the major averages of 1%. we have seen this accelerating throughout the day.

the dow is down 1%. the move that we see in the vicks is commensurate with the move downward. the vicks is a measure of volatility with stocks and it's taking to a one-month high. -- the vix. look at my bloomberg terminal to see where the most carnage is in the stock market. you are seeing it nearly everywhere. it's a broad-based selloff in addition to being a relatively sharp one. telecom, industrials, materials selling off. the s&p 500 materials indexes down the most in two months time, seeing it down 1.3%. a lot of a different array of chemical makers selling off. minors stocks are down today. we have copper stocks down and gold at a 40 week low. alix: nowhere to put your money.

gold is the safety trade. thank you, julie hyman. let's look at the stories making him isis hour. the nba finals get underway in oakland. -- let's look at the stories making headlines this hour. both teams also have first-year coaches. american pharaoh is the early three to five favorite to win the belmont stakes and complete the triple crown. he won the number 5 -- he drew the number five post position. and the new world videogame hall ong, an includes p early table tennis game, and the hall of fame in rochester, new york says six games were inducted. super mario

brothers, pac-man, tetris -- whoo-hoo --and world of warcraft. be merging with t-mobile. that is according to a report from wall street journal. that would put ceo john legend at the top of the company. the price is not been the sided yet, but together the companies are worth 64 billion dollars. bloomberg west anchor emily chang joins is more for more -- kind ofergen --what combo would that be? fireworks. , was sitting next to charles the bloomberg media reporter and he has been working the phones. keep in mind charlie ergen has had a lot of talks with a lot of different companies and failed to complete a a lot of deals. he did publicly bid for sprint, clearwire. those things did not happen.

what is also interesting, john gere, who is normally outspoken, he tweeted a couple things about this deal and then .eleted those tweets he specifically referred to those as bad reporting. it's unclear if he is talking about the reporting or the analysis in that story, but the dish and t-mobile were the last lonely people at the bar and should maybe hook up. it is also his birthday. now that those tweets have been -- deleted, he has been getting birthday messages. a couple months ago on bloomberg television in an interview with mark crumpton, he did address the idea of a merger with a company like this. take a listen to what he had to say. legere: i just know they

in an adjacent industry. if customers are better served, i think markets will find a way. there certainly ,alix, are things dish and has that t-mobile could want and it could make sense. we just don't know if this is realistically going to happen, despite the talks that have been going on for a long time. alix: and does it make sense for these two companies? which one needs he other more at the end of the day. emily: dish has been trying to .et into the wireless business t-mobile is the fourth largest carrier in the country. way to go.s a long you see at&t buying directv. you see verizon getting into video. dish has programming that t-mobile could benefit from.

there are potential synergies. is it actually going to happen? we don't know. alix: lots of fun stories to come out of this. think so much, bloomberg west anchor emily chang. still to come on the bloomberg market day -- will be doubt turn negative again for the year? we will look at the selloff. adam parker from morgan stanley is here in. we will discuss. ♪

alix: this is bloomberg market day. hewlett-packard is said to be near a deal to acquire computer science. joins us.an hey, alex. alex: hey, alix. hp was workingas on a deal to potentially announce it was going to split

into two, and when that deal fell apart, that's when they went ahead and said, ok, well, we are not going to sell to hp. at our plan b is to put it into two companies and follow the track of any other large enterprise tech companies that made the same decision over the past 12 months. there are others who have made the same decision, trying to spin off the acquisition as a company. the other side of hb is the pc and printer business and that would go along in the enterprise as this would have been bought out. another company could return to this. they have preliminary discussions to intentionally by a division ofcsc. governmental -- portion of their business. much, allie,so

joining us from san francisco. we are looking at triple digits around the lows of the session. what gives? joining me now, my guest, adam parker of morgan stanley. always a pleasure to have you here. i made you come in early. tell me what is going on with the selloff? i don't know, i think people might of thought there'd be a more imminent deal increase. i am still quite bullish on equities, alix. u.s. market lags on most every other stock market in the world. it is a good time to buy u.s. equities. alix: what is with the vix? adam: there's a lot of things

you can do at the stock level and sector level, we are overweight financials, energy. i think you can find a way to make a lot of money and keep the market level. it does not move as violently as you want. alix: you are overweight energy -- they said oil was going to go lower. did not happen. might you see this in the sector and do you care really? adam: i would care if we had some emergence in the cartel, -- demand isok going up and supply is going down. i do not think we need to complicate it much more than that. we are going to own energy. if the fed is going to move the front here for the next few months we will see nice movement into the banks. a few weeks ago was the first time we ever went overweight in the financial sector. alix: really? i'm: it is a new thing

trying on. like your new haircut. i'm trying a new thing. alix: like a boy. i am. you have nice movement around the 10-year. the 10-year goes up, they outperform by a lot. we are looking at a lot of stocks across the board, banks, regional banks, where the regions are too low and i will myk about that with colleagues. they're interesting things happening in the financial sector, too. they're still around record levels. put it in perspective for us. guys, we are basically and an all-time high. we think the earnings are about 4% growth this year. we are going to buy back 2%, 4% of the shares. a percent total return. that's pretty good in my world. where sentiment is not that high, but we are near an all-time high.

alix: but no one feels good about that. adam: it's a pretty good set up as far as i'm concerned. analysts got so negative. that's an unusual thing. we have 39 years of a sell side data on earnings since 1976. the analysts were too optimistic. we are right at the bottom. what is where, 2014 we are not in recession recovery. for the first time ever, i think the bottom -- that is an interesting phenomena and in that is what you want to get involved when you can't. alix: all right, much were to come from adam parker. so good to have you on this day. adam parker from morgan stanley. ♪

from we are moments away the closing bell. this is the bloomberg market day. i am alix steel.

[bell ringing] it is read a across everyone's. you are looking at the dow closing off by 174 points. the dow and the s&p are closing at one-month lows. the stock suffering their worst day in more than a week. plunged at its session lows. we are kind of in the same zone there. most stocks finishing lower in all of the sectors in the s&p finishing lower. and ugly, gross red day. joining me, joe weisenthal. one thing that caught my eye today, the macro picture -- they reported the low in of earnings and sales rates for the end of the year, but they did not say bad news.