payment and will look at what the prime minister may do next. pimm: payrolls jump along with wages in the strongest jobs report of the year. we will look at what it means to the economy and a potential federal reserve rate increase. is readyerican pharoah to run at the belmont stakes tomorrow and we will look at the odds of winning the first triple crown and 37 years. -- in 37 years. pimm: good afternoon. betty: let's begin with a look at how the markets are trading. equities have been mixed all morning long. it was after the better than expected jobs number. greece,concerns about

that is bringing some of the investors and some of the shorts in here. pimm: let's take a look at the oil markets. crude oil has a little bit of a decline, about $.20. brent crude is lower by $.28 but gold is down more than seven -- seven -- $7.50. let's take a look at the bond market. the yields are higher and prices are lower. 308 which is as little bit of a selloff. let's look at the dollar. against the euro, $1.11 which is a little bit of a decline. the yen is the big mover, up more than 1%. the japanese yen continues to weaken. let's go to the top stories -- greece has upped the ante in its

showdown with creditors. we will hear from the man responsible, the prime minister of greece will speak to the greek parliament at any moment. he told the leaders last night that greece could not trade more austerity for additional they'll of funds. has pushed upece today's scheduled payment to the international monetary fund and the new planet to bundle a number of june imf replay mentz and come up with more money at the end of the month. good luck. no country has managed to do that to the imf in three decades. us fromgotkine joins athens with more. what is going on in greece right now? tt: they were paying their bills on time and the prime minister is not speaking on time.

not gotten up to speak in parliament but that could happen at a moment. we are not expecting any major announcements, probably just an update on what he is doing. we would expect them to come out fighting to get the best deal for greece to end the humiliation of greece which was imposed upon them due to the two bailouts that have taken place and perhaps also give a window into what he is planning going forward. he is preaching to his domestic constituents but they are not aimed at angela merkel or the eurozone members. own lawmakers in parliament and his own party because some are more to the left who are dead set against skirtal that would even the red lines to be laid down before he was elected prime minister. pimm: thank you very much. we are awaiting the primus to's speech in parliament.

it looks as if the u.s. economy is back on track after starting the year in a slump. payrolls rose in may by the most in five months. employers added 280,000 jobs and that is more it then the median forecast. thomas perezretary said creating jobs is not enough amity economy has to create the right kind of jobs. jobs pay related better in the aggregate, roughly 15%-18% more. when we talk about wage stagnation, one way to address it is to make sure we create well-paying jobs. export related jobs are well-paying jobs. pimm: meanwhile, more people started looking for work last month and that cause the jobless to 5.5%.ise 1/10 of 1% betty: the walmart board has elected a new chairman, the grandson of founder sam walton and will succeed rob walton.

he is taking on the new role after joining the board of the world's largest retailer in 2008. >> when it comes to our board, because of our families commitment combined with strong independent director voices, we have a great balance. now is so important right with a tremendous change that all retail is going through. fory: walmart set the stage his succession when they named the newly created position of vice chairman and has been a venture capitalist and formerly worked at goldman sachs. u.s. officials are familiar with the hackers who stole data on as many as 4 million current and former government employees. they say it's the work of chinese cyber thieves who have already stolen information from health care companies. the hackers may be targeting employees who have applied for security clearances. china is rejecting the suggestion that it is responsible. whichs staying the course

means more competition for market share between oil producers. the oil cartelof agreed to keep daily production at 3 million barrels which should mean more pain for u.s. shale oil producers who have a record number of rigs because of the oil glut. it should keep a lid on energy costs for consumers and keep inflation in check. oil prices are down about 6% so far this week. since it's lunchtime in the east, we want to remind you about a unique dining opportunity. time is running out to book this year's power lunch with warren buffett. you can do it on ebay and the top it is more than $1.5 million. you could get a bargain because three years ago, it went for $3.4 million. be warned, he will not tell you what he will invest in next. the bidding and in 10 a half -- in 10.5 hours. the proceeds go to charity so

you can still put your bid in. pimm: not more than $1.2 billion. you can bring more people to the lunch. topic off-topic is not to ask what he is investing his money in. betty: is that really what you would ask him? pimm: i would ask what he is investing his money in. is there a time limit? has he agreed to spend at least one hour? betty: there is no time limit. all i have been there and the press is there and they do interviews with the winner and with warren buffett, they go downstairs and they eat lunch and i goes on for however long they want. if you are going to pay $3 million or more as some but he once did, you will want as much time as you can. you said they have spent more than $3 million in the past

and $1.2 million now seems like a bargain. betty: coming up, violence breaks out in mexico ahead of the election sunday move a look at the controversy over the government's decision to give away millions of television sets for free. pimm: then, we will look at 's odds ofharoah winning the first triple crown in 37 years. pimm: the job report says the may jobs climb for the most in five months and we will get the latest from mom and el-erian. pimm: deutsche bank is conducting an internal investigation of money laundering by its russian clients. it may involve $6 billion of transactions over more than four years. the german lender is analyzing data from 2011-2015. betty: it's no secret that tanks have had scandal after scandal -- that banks have had scandal after scandal. >> we have to admit that

misconduct has played a major banking inunately in recent years. the reputation of banks has been tarnished. there is an issue that you need to have a high reputation and there needs to be trust among market participants for the financial system to be stable and function well. betty: joining us now from london is susie who wrote the story and also with us is neil weinberg who covers financial crimes. i want to get some of -- give us the details, the basics about what exactly deutsche bank is investigating. this is early days per it know they have an internal probe going on at the request of the bank of russia from october. they are looking at whether russian clients were allowed to buy stocks and rubles through the bank and then the bank purchased a similar stock in

london using u.s. dollars and whether that facilitated money leaving russia and returned and dollars that would effectively facilitate money laundering if that was the case. know -- we are talking about $6 billion in transactions? that is the forecast figure and that could increase. they are telling us currently it seems like it's in its infancy. alerted and it looks like the regulating machine is working. pimm: if a banks clients do something that breaks the law of a country in which the bank operates but the bank does not know that they have broken this law because of some other transactions they may have done, the alleged transactions in london, how does the bank deal with something like this? neil: the problem is either a dozen know it's customers which

it's supposed to or that perhaps some of the local employees knew what was going on. neither of those outcomes looks very good for the bank. that is where deutsche bank appears to be right now. as they have mentioned, they have released some of the local employees in moscow will not be working for them. suzi: what about the people involved? are their names we know that may be targeted? who could this ensnare? suzi: there is no clarity in terms of clients. we know they have suspended the russian head of equities and a number of other employees in that group. we are told that more are likely. symptomatic of the fragmented nature of bank regulation around the world?

we have talked about argentina and you've got venezuela. how does the bank regulate this internally? neil: there are strict rules in terms of knowing your clientele but it's a complicated business. regulators have expressed concern that we've gone from and vanilla bank accounts to more complicated things like trade finances and here, securities. these are areas that have been a big focus of u.s. regulators recently. betty: thank you so much. pimm: still ahead, mexico holds election sunday and there has been tension and violence with clashes over many issues. the opposition party is accusing the government of trying to buy votes by giving away millions of televisions. that story is next. ♪

pimm: you are looking at a live shot of a to the tea inside the greek parliament where we expect the prime minister to speak to the parliament and address the issue of greases repayment to the international monetary fund. we will bring you more details. elliott gotkine is on the scene and we will have details as soon as the primus to her takes the podium. welcome back to "the bloomberg market day a." betty: what will he say about

the laying the payment? that has affected the equity markets and offset the feel-good effect from the jobs numbers. julie: we are seeing a tight trading range. we have not had two consecutive days of gains during this whole period. we have had a few consecutive days of losses at a time but it has been unusual. we have had the tightest trading range at this time of year since 2006. the lack of action has been somewhat unusual. that's something to note as we go into the summer months which also tend to be relatively quiet. let's get to some movers -- let's bring up under armour. it was the best performer in the s&p 500. it is only up 3.5% so there are not a lot of it gains in the s&p 500. the stock was upgraded and the

analyst said the growth profile looks good for the stock and there was a selloff to post earnings that is unjustified. if you look at how they have done versus nike, it's up about 19% and nike is up about 6%. armour has been growing more quickly in terms of its sales growth and its shares have been as well. let's get a check on fiat/ chrysler after comments by sergio marchi one-and-one us -- marchioone. it looks like there is some disappointment over the timing and the shares are down by 3%. we have an ipo today. up 34% after tea, they sold 5.1 million shares in their initial offering. it is a canadian company.

i know you guys will talk to the ceo later today. betty: that's right. in the next hour, we will talk to the ceo. i have not tried their teas but i believe there was one right around the corner that is outrageously expensive for tea. we were talking about artisanal soft drinks. julie: starbucks has got more into that business. that's the next wave, post coffee. betty: i am thinking with my cup of joe. pimm: well done, let's take a look at the top stories. facing aachs is multibillion-dollar penalty over sales of mortgage-backed bonds before the financial crisis. they are in talks with the justice department to pay as much as $3 billion to settle an investigation. the deal would take place within weeks him a government has been

trying to hold more wall street firms accountable before the crisis. a setback for president obama's efforts to normalize relations with cuba. the house of representatives as blocking a plan for regularly scheduled flight to the island nation. a florida congressman said it would be wrong to lift the restrictions and because the airport was partly owned by american interests when it was seized by castro's government. for is a strategy argentinians who want to get their hands on dollar-based assets. go ahead and buy art. south american countries plagued by high inflation and a weakening currency. the consumer prices have increased 29% annually over the past four years while the value of the peso has tumbled 55% against the u.s. dollar. this weekend's art festival in when is aries provides -- in allows argentines to buy art work in u.s. dollars

but can be granted a favorable exchange rate in the transactions. attendees can access dollars at the official rate and side set up -- and sidestep the currency controls. that is a look at the top stories of this hour. betty: still ahead, if you're thinking about putting money into a horse -- we will find out tomorrow if and don pharoah something no horse has done and 37 years -- win the triple crown. can he pull it off? we will find out. ♪

" bloombergis market day." pimm: american pharoah will run in the belmont stakes tomorrow and could become the first triple crown winner in 37 years. betty: what are the odds?

we investigate what makes this race so challenging. david: belmont park on long island -- 100 tenures old is home of the belmont stakes, what's known as the test of the champions. >> he's got a nose in front as they come down to the wire. david: the last triple crown champion was called a firmed in 1978 and there was secretary at coming alan fox and seattle slew. to find out why a horse has not won the triple crown since the late 70's, we turned to the in-house expert. , residentdopoulos course racing expert. he has been following racing actively since 1990. haven't betting on the ponies and watching them for a long time. david: i am a handicapper in a

gambler. david: he calls this the pack. david: the field is bigger than it used to be. david: in 19 -- in 1978, affuirnmed raced against four other horses and now there are seven. it's common to have a field of 11 or 12. the second reason is the ambush. david: if a horse loses the derby, his owner main -- may decide not to run them in the preakness to rest up until belmont. years for the first 125 up until 2000, that had never happened were eight horse ran on the derby, ran in the preakness and won the belmont stakes. over the past 14 years, it's happened seven times. david: five of american pharoah 's competitors ran in the derby but skipped the preakness. number three is the distance. david: this track is longer than churchill downs.

it's the biggest race in north america, 1.5 miles and they will do one big lap. never raced have this distance in their life and i never will again., never avid: the last reason -- the calendar. horses used to run all the time on three weeks rest. that pays only happens during triple crown season. david: it's a very compressed race scheduled and many times, he will not give us his a racer. dqavide: given all that, the calendar, the distance, the ambush, the pack --how does american pharoah look? david: he is a standout. david: have you made your pick? david: i try -- i will try to beat him with another horse. betty: we are joined by david papadopoulos himself.

what is going on before this race with american pharoah?d avid: they are trying to get him acclimated to belmont park after he arrived two days ago. he has never been on this track and it's a different racing surface than he has been in before. they call beaumont park big sandy. it is a sand-based service which is loose and dry. we will find out on saturday if he likes it but i'm not entirely sure he will. pimm: thank you very much. i'm going to watch. betty: are you going to watch? pimm: i will watch as well. betty: we are focusing on jobs when mohamed el-erian joins us in a few moments. ♪

he told the leaders of germany and france that brees could not trade more austerity for additional bailout funds. greece has pushed off the schedule payment to the imf. payrolls rose by the most in five months. added 200 80,000 jobs, more than forecast. labor secretary sounded an optimistic note. >> this is the best month for wage growth we have seen. still have a lot of work to do. this is very promising. betty: the jobless rate inched up 1/10 of a percentage point to 5.5%. it is a complete victory for barclays in a battle going back to the start of the financial crisis.

they have reached a settlement with trustees for lehman brothers. the bank will receive all but $8 million of the 1.1 billion in assets that were in dispute. pretax boost barclays profit by $750 million. allie baba wants to bolster its presence in the u.s.. china's largest e-commerce company opening a government affairs office in washington. the person that will run it will , a former gmtier executive and official in the bush and ministration. the labor department delivered her worst nightmare. the u.s. economy created 280,000 new jobs, hourly wages up to .3% compared to last year. treasury prices fell and yields leaped.

this seems to be the perfect scenario for all of those bowls in the market. that we got today with the jobs report, right? mohamed: this is a good report likehere is a lot to about it. wage growth, 2.3%. people are coming back into the labor market. all of this points to a healing labor market. the market reaction was textbook in terms of the yields higher, the dollar stronger. the equity market is torn. it is torn between seeing good news on the fundamentals and worrying that this will make the fed hike earlier than they would like. betty: it is interesting how much the credit markets, the bond markets moved in reaction to this. in fact, much earlier and much

more the grisly than the equity markets. why is that? mohamed there is the profit for interest rates and therefore what is happening on the economy and what is happening on central banks. this report said, the economy is strengthening. we are bouncing back. the fed is likely to hike this year. there was a clear message, higher yields. the equity market is torn because people realized that central banks have been the market's best friend and they would like the fed to remain thee, so they worry about hiking message in today's number but at the same time they look thatay, despite the fact vitamins are getting better. the equity market is in a tug-of-war where as the bond markets is clearly that the two things are aligned. betty: there could be pessimism among equity investors.

we have an editorial out today that says, this is great. we see the solid jobs growth but ,f you add in part-time workers and we have a chart here of what we have crunched here at bloomberg, if you add the people who are working part-time who do not necessarily want to be working part-time jobs. the jobless rate is much higher. it is close to 70%, the jobless rate. given that scenario, we are still way off from where we were before the recession. maybe that is reason why we should hold off on hiking rates? unambiguously, we are not back to where we need to be in terms of economic robustness, growth, prosperity. we have a long way to go. yes, the labor market can improve further. in particular, part-time to full-time, getting wages to be

more dynamic. the editorial is right in terms of absolutes. we are not there yet. we are getting closer. remember, that we are starting from a situation on the policy rates at normally low rate. repressed interest rates. net, within the fomc, this will be seen as conducive to them hiking this year and not waiting until next year as the imf has suggested. imf since growth much lower at 2.5%. could we be closer to something like 3% growth? -- i suspectthis summer between 2.5% and 3%. stable and low inflation, higher growth come a strengthening labor market is enough for the fed to hike.

the fed wants to normalize rates. they are worried that they are encouraging excessive risk taking in the financial markets and they are encouraging a misallocation of financial resources that could hurt us later on. there are lots of reasons why the fed will see today's report as reinforcing the notion that they will hike this year. further evidence that the economy is improving and that it is ok and clear to raise rates. i want to turn over to what is happening right now. the greek prime minister is addressing parliament after he has basically said i'm not going to be able to make that payment today to the imf. what do you make of this delay? i think -- mohamed: i think the delay makes sense for greece. it has only been used once before by an african country 20

years ago. i understand why they did it. face something important. we are focusing mainly on greece versus the creditors. there is another battle going on. party to stick together as we look to compromise with the creditors. the problem with bundling all of the payments is a lightning rod, this will be a very large payment. -- at a time swiss increases having difficulty making payments. inare of the lightning rod terms of domestic politics. betty: you mentioned that it gives him more negotiating power, perhaps, right? what could change in having this lightning rod, what could change

the negotiations with the imf and with the other countries? there are several issues, vis-a-vis the imf and the several creditors. one is the extent of reforms and fiscal consolidation. two, as yet greece has not offered a copperheads of debt reduction program. these are two things that are necessary to get them to agree. internally, it is really obligated, betty. this is viewed as more than economic issues. this is viewed as a political issue, and therefore it is hard. the prime minister is trying to retain his base that he needs in order to continue to govern. while europeans are worried about the future of their region, we seem to be focused on other issues including this controversy, mohammed. i know you have read the papers paulson's 400 million

dollar gift to harvard. at used to run the endowment harvard, you know how rich it is. there was a criticism from gladwell, as you well know, when came down tot, "it helping the poor or giving the world's richest university $400 million it doesn't need." several others came out in defense of john paulson including marc andreessen. he tweeted out a few moments ago on -- where do you stand on this? i'm in the middle. it is amazing how this discussion has gotten so extreme.

undoubtedly, philanthropy should meet a number of objectives including critically helping the poor and helping marginalized segments of society. i completely agree with that. that is about health, scholarship, education, etc.. universities, cambridge, a very important role in terms of research, in terms of educating people. the important thing is to get a balance. it is neither all of this or all of that, it is to get a balance. i would say the critical thing is to make sure that the philanthropy efforts are very important, very material, and they cover the range of means and not because of traders at one and/or or the other and. the point about the 1%, we had a story about warren buffett giving a pledge. more of the 1% are putting their

money to good use to shrink, something you have talked about quite a bit, the inequality gap we see in the u.s. but around the world. many are. look at what bill gates is doing. their foundation has played a critical role in pulling people out of misery. you are talking about health, education. there is a lot going on. the important thing is to focus on the picture. the worst thing is to discourage philanthropy. we don't want of these to go on planes and other things, ok. it is much better for them to be given to institutions and to people in need and to make sure that the whole range of objectives are covered. we are getting a headline from the new york fed saying likely toed is still start raising rates this year.

the fed is still likely to start raising rates. how to that? there was a conspiracy theory about why would the imf do something unusual. they are very explicit about the controversial policy issue. one of the conspiracy. was maybe that the imf was putting its method out there on behalf of the fed. i did not believe it. i think the imf had different reasons to do it. it is notable that dudley comes out and says that the hikes are likely to be this year. you have heard this over and over again, that the most likely outcome will be a september hike. remember, the critical thing is not the first hike, the critical thing is the journey which will be very shallow, stop, go, stop, go. the endpoint will be lower than what it has been historically. mohammed, thank you for

joining me. viewed el-erian, bloomberg columnist.

betty: kind of a hazy day on this friday. welcome back to bloomberg market day. let's look at how the european markets closed as we are watching. >> you take a look at the map, you can see the climb pretty much across the board. a big concern, of course, not just in europe that globally. when you look at the movements that are watching today in terms of equity benchmarks. the worst performing in western european markets today, surprise to surprise, is the athens stock exchange. the only benchmark as well that is posting losses so far this year.

the ftse 100, also not doing too well. worst weekly drop, extending a two-month low. finally, europe's equity benchmark extending its lowest level in almost a month. by the way, that has fallen 6% since it hit that record high back in april. if we look at the biggest stock rumors, vodafone down today, we have been watching that after they were in talk to swap assets. they are not discussing a merger. greece, not bank of only the two worst performers today on the equity benchmark but also for this week. the euro has been pretty resilient, actually, despite concerns about greece. we have actually seen it have its biggest two-day gain since 2009 this week. the weekly gain against the dollar. look what happened earlier today. you saw it plummet.

guess what that was? u.s. jobs. companynother chinese set for another big ipo in hong kong adding to the more than $20 billion raised so far this year. david ingles tells us more. david: another huge ipo come into the market. the company legend -- they hold about a third of the world's largest tc makers. it is pretty high profile. $2y got approval for a billion investment in hong kong. that has been raised in ipos through hong kong. so, traffic has been very busy. the markets have done very well. let's get to matt miller for the big story of the market day so far. take a look at the

averages, their lack of movement might be one of the big stories. the dow coming down a little bit. you can see about 2/10 of 1%. if it does close down, it will close down for the week, it will be the third straight down week which is the longest stretch we actually.in months, since march, i believe. here, use the the s&p gaining a little bit. i want to mention green mountain coffee, the maker of those carried machines. morgan stanley comes out saying that they think that green 2016,in can go faster in at about 7%. the stock has gotten so crushed compareds undervalued to the other companies that make similar machines. it is down 35%. green mountain ready for a bounce back.

now, as far as what is going on in the s&p, we had 278 stocks down and get you see the s&p up. some of the big heavy bank stocks are floating the average up. jpmorgan up 2%. jpmorgan trading at an all-time high. goldman sachs at 6/10 of a percent. not that high of a move but at the highest point since 2007. the 10 year yields, you must have seen the headlines coming across from the new york fed. dudley thinks that the fed should raise rates this year. you can see the 10 year note reacting little bit. labor markets. the waste numbers as well and because inflation has been so well anchored. if it stays at 1.6% every single month. that is fine.

they support a rate increase in the target rate later this year. occasionthat is not an he would go for june, but september becomes more likely. betty: everyone says september. matt miller with the markets. david is brewing up and faster -- davis t is brewing up on the nasdaq. they are up right now by about 36%. they plan to extend their location in the u.s. but they have some hot competition from starbucks. joining us from the nasdaq is a's ceo. your locations we are looking through our your home country in canada. you have about 25 in the u.s. him a sum in new york. why are you expanding here?

tol you need the proceeds expand aggressively in the u.s.? been growingve aggressively in canada, we are in all of the 10 provinces. we started to open stores in the u.s. in 2011. we offer rate in four different markets, we are in new york, boston, chicago and san francisco. we feel positive about the reaction of consumers to our concept. so, it is a good day for us, a and thelestone and proceeds will be used to fuel our growth and create shareholder value for the the long-term. betty: you have starbucks which is a big giant of a company and competitor. they will open a thousand stores in the u.s. over the next few years. how do you compete with a giant like that? we have been in tease since 2007, 2008. our brand is very very modern.

our take i.t. is to make it fun and accessible for young customers and we have a very broad deal. we have been able to attract those customers, we are really involved in social media. we have grassroots approach marketing. we feel the market is growing fast enough. they are seeing the growth of the market, which makes it more interesting for us and we are called it about getting our fair share and been able to grow our company to the 550 stores that we planned for. , the ceolvain toutant of david tea. thank you so much. more on a market day, we will be back.

a quick looktake

at how the markets are trading here admit day. you can see stocks are pretty mix. the stocks in greece, italy their payment. they are saying to the greeks, don't give in to blackmail, which is what he's calling the creditors. is running that time out for all, it is not just recent cell. that is why you see at the markets that are it makes. also trying to digest the jobs data that came out. much more ahead on the bloomberg market day.

♪ 10:00 a.m. in san p.m. in new york,

1:00 a.m. in hong kong. mark: the greek prime minister is calling on all parties to decide on a debt deal. drops along with wages. we will look at what it means for the economy and a potential fade rate hike. mark: he will tell you why corporate giants are becoming the biggest buyers of corporate bonds. amty: good afternoon, i betty liu. mark: and i am mark crumpton. let's begin with a look at the markets. investors reacting to the may job to report which shows payrolls rising by 280,000 workers. traders anticipating whether the fed will raise interest rates later this