from we are moments away the closing bell. i'm alix steel. bye-bye losing streak. the dow and the s&p looking at their best day in a month. the s&p is higher for a second day. of green across the board. up 2%eading the way followed by financials. echoes hittingt

an eight-month high as you see money flowing into the stock market. weisenthal. finally an update. today was big story greece. we were set to say just ignore it, same old same old. we got some exciting headlines today. germany isporting considering a staggered deal or maybe they commit to one reform. just do something so that we can give you money and not have it be a loss. that helped markets today. they got a boost. alix: then germany denied it. guest: merkel didn't react much to the denial. where there's smoke there's fire.

the interesting thing, big picture, we have been going for months talking about greece. what gets loss is how devastating how this has been for the economy. we have a couple of charts. the first shows the private sector deposits. as you can see ever since it became clear late last year greece was going to have an election and new government money has been flinging the banks. that is not good. the flipside of the same coin, it looks at ecb emergency support to the greek banking system. it looks like the opposite. the ecb has had to provide much more of a backstop to the banking system. alix: they only have 12 billion euros left. it seems like they are going to max out. guest: we seem to be coming to

end day. we have been saying that for a wild. alix: i was checking out netflix. it has risen the most since april. on anhe stock really move upgrade? does it? maybe not. within the report, the analysts cited strength in the iphone and ipad app downloads and that the international market would grow. that is core to the business. the downloads on your mobile devices. investors approved a proposal that paves the way for a spot -- stock flip. the big stunner today, the annual statistical review came out. oil nerds love because there are all kinds of data and charts. there was one chart that completely blew my mind. the u.s. is the largest producer of oil in the world. the u.s. is the orange line and

has passed saudi arabia. boom. that there was a i still found that completely astounding. i am sure you have found tons in the report. i loved it. the u.s. is producing 13 million barrels a day when you account for all liquids like natural gas and oil, beating out russia, the stronghold there with natural gas. he expects the production to continue to grow. it is all about the shale flexibility. you see hedging. wells that are drilled but not filled. they get in there and get out. new layer in this this amazing market. here to discuss is jim keenan. marcooomberg stock editor reagan.

thank you for joining us. caught mything that eye were buybacks. we have seen a lot coming into the markets. talking about the announced buyback, 50% up this year. seems like a big number. if you dig deeper than may be they made the distinction between buybacks and completed buybacks. you are looking at six, 7%. guest: it is almost a shell game that some play if they want to where you announce i'm going to buy back $10 billion of shares. the board has approved that much. then you look back and they didn't really purchase that much. they get an authorization for that. saying, strategists was they are good for the stock, completed buybacks are better for the stock. jump is due the big to a couple of big names.

ge announced a plan to buy back as much as $50 billion. for 2015 they are going to buy back 8 billion. he is saying it is not necessarily going to translate into completed buybacks. one of the fascinating data points he pointed out, if you add up dividends and buybacks, they are paying out more than they are earning in profits per that is an unsustainable thing. you can continue to pay out more than you are earning. especially with interest rates cutting off the source of credit a lot of companies are using. guest: one of the things that people have been talking about in the idea that companies are borrowing so much to do buybacks that they are becoming significantly weaker credits because of it. the balance sheets are deteriorating. you look at these from a credit respective, does this make sense to keep borrowing just to boost stocks? guest: i was separate the

question. i do think that we post the financial crisis for a. of time where corporations were trying to get their balance sheets in order for a potential recession. when you look at this point in you are seeing more company starting to real ever their balance sheets to buy back stock. some companies are spending on m&a activity. interest rates are low right now. equity markets are benefiting companies that are doing these stock buybacks. i don't think -- although the credit risk is increasing, i don't seeing it is excessive. you are seeing it more than in the high-yield market today. alix: there was an know about corporate u.s. bond market blooming to 3.7 trillion in the past decade. most of that is in the hands of

three big types of investors by foreign investors and mutual funds. there is so much debt issues. guest: this is the constant talk. bond market liquidity. a few months ago no one was talking about it. now it is every day there is some new warning about bond market liquidity. i am curious, what is your take on these liquidity concerns. wonder, obviously the regulation since the financial crisis has brought a lot of dealers out of the market. there is less people warehousing credit instruments. i wonderful some middlemen step into the role? to.credit and von rockets -- the credit and bond markets o too.

i am wondering, is there a role for a new middlemen to come in or the dealers used to be? >> i agree. you are talking about a significant and secular change that has happened over the last 10 years. a lot of credit that used to be owned by the banking system is now owned by investors with concerns or pension funds. that is providing a significant new opportunity for investors and savers to access the market and a good product. the liquidity is certainly a change. the fact that there is volatility in the market, there is not a lot of turnover and trading in the credit markets at all. that does present risk. it does present the fact that if there is a shift in the market you will see more volatility and pricing. i agree in the sense that there .ill be an evolution

the pension funds, insurance as you see volatility pickup they will want to change the relative value on that. the banks will play a key role but it is not necessarily going to be warehousing risk like in the past. raise a good question of where we will see the risk. where does the next fight can show crisis will being -- where will the next financial crisis be? politicians and regulators expand a framework that will have unintended consequences for liquidity in our financial system and may fuel the next financial crisis. mike is laughing. the idea is there is risk we don't know about. guest: it is not the question of

wher will there be a crisis, there is going to be one for where is it going to be? that cracked me up. it is a question a lot of people are wondering. guest: could there be a situation where we have a crack up in credit but stocks do fine? alix: it is amazing the volatility has lasted out of the stock market. a lot of people believe it is inevitable. i wrote earlier how they called it a boring stock market because of the tight range we have been in. there is a sense of inevitability that volatility will return. it is nowhere inside. alix: thank you. we are going to take a quick break. we are going to continue talking about where the risk and volatility is. stick with us. ♪

alix: welcome back. the clinton foundation is facing scrutiny over its finances. live onnton is speaking bloomberg earlier today from the clinton global initiative in denver offered a defense of his foundation and its activities. he was asked about the foundation's future and hillary clinton, and whether he would continue to make paid speeches. bill clinton: i don't think so. once you get to be president than you are making a daily story.

speeches on give the subjects i'm interested in. i have enjoyed those things. alix: he defended his foundation saying its disclosures are more extensive than those by most private institutions. president obama is sending 450 troops to iraq to train. the white house says the troops will not be in a combat role and the u.s. is sending more military equipment to iraq. there are 3000 troops there. the russian president met privately with pope francis at the vatican. he used the talks to call for a sincere attempt to bring peace to troubled eastern ukraine. the vatican spokesman says the talks were focused on the middle east where the holy see is worried about the fate of the christian minority.

those are your top headlines. who isk with john keenan fired up right now talking about volatility in the bond market. where does it spread to? guest: if you look at it we are going through a. of time where the economy is improving, there is a lot of sectors that have continued to deleverage and you are at a point where inflation data is starting to move. there is a dispersion between different economies. you are starting to see volatility pickup around the world but it is coming off low levels. it still remains at low levels. quarters five-year treasury. these are not levels that are necessarily shocking the economy are going to disrupt significantly. at this point we are not talking about race -- rates that would slow the economy.

that is different than the comments with regard to steve schwarzman's comments. there will be another economic shock from a variety of different ways. what that means from a credit standpoint and liquidity, we have to seeing. how can there is a shock how it is going to be a buffer for liquidity can come back to allow the economy to continue to function. it will happen. is the high-yield market an indicator of how good the economy is performing. guest: historically it has been. that is not mean it is going to be the leading indicator in the future. necessarily mean it is going to be the leading indicator.

it ties towards the health of the credit to the market. the market currencies clinic credit markets as a whole. the next shock that we look at is going to be the left one. your base case is four to 6%. what do you avoid? we look at the high-yield market now. it is not cheap in the market. .t is a good asset to own it will get 6-7%. the economy is. improving at a slow rate per the corporate market is in good shape. there is not access risk that is going to create credit risk. you start to see increased rates.

as an investment, we like going down and owning different types of spread products. alix: historically this is different. guest: it is going to be different. if you look at the market now, rateyield is less interest risk. it is not exposed to a great environment in the long end of the interest rate curve. the improving economy, high-yield tends to do well. tothe market continues tighten that is when you have to have to worry about the risk. alix: a pleasure to have your perspective. great to have you on the show.

we are going to hear from chevron ceo john watson on how he runs the oil giant ♪.

alix: welcome back. it chevron is active in more than 180 countries pumping 2.6 million barrels of oil every single day. ceo the other majors,'s the faces tough losses. plus renewables like solar on the other. erik schatzker set down what to find out what makes this oil giant standup from the rest. guest: we are different.

the geography is different than some of our competitors in the down stream and where we have chosen to invest. make some choices based on the investment returns we see. we have chosen to not be a part of southern iraq even though we have done a lot of work to prepare to participate. tsik: it seemed the independen e have the best business model. for pricel built environments like this? guest: i have been in the industry for 35 years and we have seen the price drop five times. we have been there before. economic conditions can change.

costs can change. you have to have a portfolio of opportunities. you have to have options because you know the pace of projects won't always be exactly what you expect. we have to have the balance in our portfolio. which has been a blessing for this country. it is not the only thing that is going to be needed to bring energy to the world population. alix: elaborate. has been tremendous for this country pretty independence that largely fueled that growth have accomplished great things but if you look at the shale production of oil it is $4 million -- 4 million barrels a day.

it is 93 million barrels a day for world market. it is interesting the expectation was that this will happen everywhere. it has not worked out that way. there have been fewer places where the rocks have worked and where the economic system is in place. the world is going to need lots of energy. it is going to need shell , andction and deepwater other forms of oil and gas to be able to meet the needs that are out there. we do have some breaking news for you concerning greece. julie hyman is that our news desk. julie: the credit rating has downgraded. the outlook is negative. this is tied to everything that has been going on with greece. they talked about delaying the payment to the imf friday. it appears to demonstrate the government is prioritizing

debt.ic spending over its we have been following this situation closely and know that they are trying to negotiate over the repayment to the imf and bailout. alix: it seems like they are trying to get political. that greece needs to take its reform or seriously. thank you. thank you for watching. i'm alix steel. have a wonderful afternoon. ♪

>> from our studios in new york, this is "charlie rose." charlie: >> from our studios in new york, this is "charlie rose." historyt belmont park when american pharaoh won the triple crown. he was the first horse to complete it since 37 years ago. here is the look at the home stretch of saturday's race. >> as they time to the top of the stretch, american pharoah makes his run for glory. they come into the final furlong. frosted is second.