back the dignity of his people. and a conversation with outgoing chief exec officer. we are live from our world headquarters in new york. it is monday, june 15. i'm tom king. joining me, brendan greeley. greece -- and you mentioned moving east? brendan: the possibility of a brigade moving into -- they do not know exactly where and it is not final yet, but somewhere from eastern europe, estonia. that means taking the line of defense, moving it through the gap and onto the other side. you are a cold war baby. tom: i am a cold war baby. richard haass will join us with an important perspective with the news out of europe, and out of libya as well. top headlines -- here is vonnie quinn.

vonnie: greece's prime minister is horton hardening his stance. alexis tsipras told a newspaper that european creditors are demanding more cuts to pensions after plundering them for five years -- more cuts to pensions. after plundering for five years, he says they should be more realistic. there is no provision for more financing. jeb bush formally enters the race for republican presidential nomination today. the former florida governor will hold a rally at miami-dade university. over the weekend he put out a pre-announcement called "making a difference." >> many families now have the chance to live lives of purpose and meaning. you can improve the life of people whether it is in the programs for the developing of the disabled, fixing our higher education system -- all of these things can be fixed.

vonnie: bush has likely raised a record amount of money, but conservatives in his party have questioned his policies. president obama is back at it today, trying to persuade almost 100 fellow democrats to reconsider opposition to his trade bill. hillary clinton has weighed in. shortly after her first official campaign rally in new york, she traveled to iowa and told the president what to do next. hillary clinton: the president should listen to and work with his allies in congress, starting with nancy pelosi, who have expressed their concerns about the impact that a weak agreement would have on all workers to make sure we get the best strongest deal possible. and if we do not get it, there should be no deal. tom: the house will try to rescue another trade bill as soon as tomorrow.

-- rescue the trade bill in another vote as soon as tomorrow. hudson's bay will pay $3.2 billion for kauehof. and in pro basketball, the golden state warriors are one victory away from the nba title. steph curry led them to a win over the cleveland cavaliers. golden state now has a three-to lead in the best-of-seven series. lebron james scored 40 points for the cavaliers. game six is tomorrow night in cleveland. tom: the warriors do it, and the blackhawks did it as well the previous night. brendan: unbelievable series. tom: you have the morning brief. brendan: i have a sneeze, and now i have a morning brief. in a coma 30 this morning, we have empire manufacturing.

at 9:15, industrial production. tom: let me do a data check. futures, negative seven. negative eight earlier. euro self. euro has been soggy over the last -- the vix 13.78. here is the ugliness of the rate of change here. this is old news, as you mentioned. brendan: this is coming from the greek central bank, it is a month lagged. bloomberg news is talking to taxi drivers to find out how many people they have pulled away from banks bearing sacks of cash.

already a month ago, it looks ugly. tom: markets moving this morning on greece. we have gone headlines back and forth on some real news. the real news on greece this morning, the headline is "citrus says no -- tsipras says no co hans nichols, what changed from friday? on scope people -- hans: people are probably saying they had never even thought of what you do the morning after greece defaults on its debt to the imf. tom: will the european leadership blink, as most of the headline seem to be about the greek government? onhans: if you are looking for any sort of possibility of a blank, it is because there are fishers emerging between --f f issures emerging between the imf

and its partners. it seems his fellow creditors were being criticized as much as the greeks. what is clear about this morning's we are basically in the schoolyard. they are schoolyard talks. both sides are saying, "you get realistic" and when you are at that level of animosity, it is hard to see who the adult will be that will clean this up. brendan: we have gabriel sackler treaties -- let me ask you, over the weekend, with governments in the eu getting more open about the possibility of a greek exit does anyone have a plan that involves a default while staying in the euro gekko? hans: do you default when you do not pay your bills at the beginning of july, or later in july when you have to pay the

ecb. secondly it is not a default if you do not pay the imf because you have the built-in grace period. talk about markets reacting now and money flowing out of greece and talking to taxi drivers. you will see massive amounts of capital flow out of greece. even in the next couple of days because of the uncertainty. what does the ecb do on wednesday? tom: hans wells, we will see you in the next hour. with us the entire hour, richard haass. we will speak with him about isis, libya, and trade. ambassador haass what i find interesting here is, why don't they just let them go? why don't the european leaders move away from the german world war ii model. ambassador haass: the idea that

europe has to stay together is a big idea. look at what europe was like for most of the 20th century. the franco german larger community is -- tom: the greek people want that as well. ambassador haass: market forces will gang up and look for the next weakest country. no one is 100% confident that if greece goes things stop there. brendan: i was struck by a piece by maria petrakis last week. it is all about keeping greece on the side of the cold war. that is part of the story of the 20th century for greece. have we been talking finance this whole time and we should have been talking the control of the mediterranean? ambassador haass: greece really is more about financing. this whole cold war geopolitics -- the pushback -- i am not particularly worried about greece's foreign policy.

brendan: if they got money from russia, that would be an acceptable outcome? ambassador haass: it is something we could live with. it is a dead-end for greece and what does russia offer except for a temporary bailout? nothing. vonnie: france and germany, 160 billion euros if that happens. greece has nothing to lose. tom: i would have dovetailed this into something else going on in greece. brendan -- you are better at this than i am -- we are moving american troops? brendan: "the new york times" reported over the weekend that armored divisions -- an armored brigade may move into eastern europe. where it may movies anywhere from estonia in the north all the way down to hungary in the south. this is moving past the old line of defense, which was centered

in western germany. tom: we have this little thing going on over here and this little thing going on over here. how stable is europe with all your sources that you have? ambassador haass: it is stable with the caveat that there is vladimir putin. it is relatively stable. this is a smart move. we have an enormous gap that has opened up between nato commitments and the country measuring nato capabilities. you never want such a gap opening up. we have demilitarize much of nato. obviously they are not giving ukraine, so this is a necessary move what the united states and nato are doing. tom: some great stories over the weekend about finland struggling. brendan: and these are all cold war stories. sweden is trying to figure out where it belongs.

the reason for not sending for not sort of fortifying eastern europe, would be to not feed into vladimir putin's sense of paranoia. are we passed that? have we given up on that? ambassador haass: up to a point. ukraine is the united states' interests and the west plus interest. this is qualitatively different. if russia is tempted to move against the nato country article five, the united states and everyone else has the obligation to come to its defense. this is much bigger stakes. as big as ukraine is, this is much bigger stakes. tom: i look at greece this morning. where will you presume we will be in a week or two? is in this almost, in nature? ambassador haass: sooner or later, if you are asking me if greece will stay and, there will

be a referendum so the government does not have to bear the responsibilities for compromise. ultimately and in a couple of months it will work out. tom: richard haass, we will talk about the living attacks and the u.s. air strikes against al qaeda. our twitter question of the day -- we go to domestic politics. can jeb out run his family? do that out @bsurveillance. as clinton is in, and jeb bush will be in this afternoon. good morning. "bloomberg surveillance." ♪

tom: good morning, everyone. "bloomberg surveillance." futures at negative eight. greece spreads are out near recent highs, recent wisdes

to germany as well. vonnie: conflicting claims after libya targets militants. his lip -- libyan islamists -- m oltar is linked with al qaeda. the companies are prepared to announce $23 billion in orders for narrowbody jets like the 737 max and the a320 neo. general electric's leasing unit is expected to be one of the biggest buyers. and talking with the ceo of boeing, jim mcinerney. the european spacious and she has begun sending back data.

the probe died last november when the comment made a relatively close pass with the sun. tom: very cool. it had come closer to the sun. very good. look at between. hello earth -- can you hear me? brendan: isn't that the classic greeting? tom: continuing international relations, we will talk about isis, the first the middle east. richard haass is with us. a wide said -- a wide set of indices this weekend. i want to talk about an issue that you have been so good about which is syria. isis we will do later, and ramadi, and all that. thousands of people on the syrian-turkish border. that has to be a humanitarian crisis as well as a u.s. crisis. ambassador haass: it is. millions of syrians have

been made homeless. hundreds of thousands if not millions have gone into places like jordan. tom: how do we project assistance to turkey or other parties? ambassador haass: we and others have provided son. -- have provided some here it at some point the real debate for the united states is whether to create a large humanitarian space inside syria. if you do that you cannot just protect it from the air, you have to protect it from the ground. brendan: how has this become an american problem? the syrian crisis has also become a european problem. talking about the flood of migrants into europe, a lot of them have come from syria. ambassador haass: what looks like a humanitarian problem quickly becomes a geopolitical problem, and very quickly a question of war and peace.

tom: what is your reading on this partition? i want to do iraq in this next session? does syria become a partition? does human get partitioned? what does the word "partition" mean? ambassador haass: i would argue that the redmond valley -- the the rand mcnally view of the middle east is coming to an end. north and south of yemen have historically been more divided than united. i don't think it will take decades, but at the end of it we will not end up where we began. tom: mentioning three times about a return to tribal nations. brendan: which is something that is very difficult for us to understand. we have this whole failure to understand.

ambassador haass: there is a difference in arabic between the word for state and the word for nation. what we are seeing is an old middle east, not the geopolitical one based on state tribe, as other allegiances come to the fore. brendan: we tend to see al qaeda versus a regime, when it is different tribal factions. we had something over the weekend. banking moon -- ban key moon -- start of the fighting has killed more than 2600 people, half of them civilians. brendan: of course, he is calling for a cease-fire in yemen.

tom has this question of the morning. what flashpoints will cause the guns in august, everything to blow up? is this something that could happen? ambassador haass: what comes to mind is vietnam. iran's role was modest. they are using massive amounts of air power. it is not working. will the saudi's intervene with other forces? i think increasingly the saudis could be vetting the future and themselves -- could be betting the future on themselves. tom: fit bit with all of those profits from the greeley household, will price $14 to $16 in their ipo. widely anticipated. i still do not know. brendan: the greeley household has no desire to put on a fit bit and find out how little

sleep we are getting. tom: we will talk about tim cook and the idea of blocking martin sorrells' ads. stay with us, with richard haass of the council on foreign relations. ♪

tom: good morning, everyone. "bloomberg surveillance." vonnie quinn, brendan greeley and tom keene this monday morning. we are with richard haass of cfr. there is little appetite on either side, republicans democrats, for large-scale military intervention in iraq and syria to counter the islamic state. but there will be heated debate and consider a posturing over

what should and should not be done. then there are all the other issues as well. richard haass on his america. you had your wonderful book recently on the state of america . what do you hope to learn from the republican and democratic candidates? ambassador haass: i do not think we will learn a lot from the democratic side because their focus is not foreign policy. one section is trade. the question is whether the democrats, even a minority is whether -- is willing to support it. it is not clear after the events of last week. tom: does trade engage the american public as we go to november of 2016? ambassador haass: no. the problem with trade, most of us benefit from it or we are not -- but we are not aware of it or the benefits are spread. tom: is multilateralism over? ambassador haass: i think people have a bias or a preference for

multilateralism in general. the problem is when it intersects with specifics. tom: heating up of course, with secretary clinton announcing saturday -- all i know is that the traffic was unbelievable. brendan: i was trying to get out of manhattan over that bridge at that time. vonnie: that was clever. tom: jeb bush in miami today. that will not affect the traffic of manhattan. our question today -- can jeb out run his family? ♪

tom: terrific news flow this morning. welcome to "bloomberg surveillance." we are doing a lot on international relations as yields gyrate. the euro 1.1220. vonnie: greece and its creditors

are arguing over who is to blame over the failure of the latest bailout talks. alexis tsipras says there are unrealistic demands for more cuts and pensions. one of germany's top lawmakers says greece has to reconcile themselves with reality. the european commission says bailout talks broke down after 45 minutes because of the gap between the two sides. jeb bush makes it official today. as the son of one president and the brother of another he will formalize his run for the presidential -- the republican nomination. and hillary clinton slammed the ceo's and hedge fund managers. hillary clinton: you see corporations make record profits with ceo's making record pay but your paychecks have barely budged. while many of you are working multiple jobs to make ends meet

you see the top 25 hedge fund managers making more than all of america's kindergarten teachers combined and often paying a lower tax rate. vonnie: clinton said if elected she will rewrite the tax code and reward those who -- not stash profits. sometime in the next two weeks the supreme court will announce whether obamacare has survived a legal challenge, and also over whether same-sex couples have a legal right to marry nationwide. southern california home builders, two of them, have agreed to merge. the new company will have 75,000 homesites. no movie has ever taken a half million dollars worldwide over a

weekend until now. "jurassic world" set the record over the weekend, taking over $200 billion in north america. the first time that happened was over marvel's "the avengers." did everyone at this desk see "jurassic world"? no? no? brendan: wrong crowd. i will see it, but i did not get there this weekend. tom:: yana saw it. brendan: that is a made up name. in a speech this weekend, hillary clinton called on president obama to negotiate a better trade deal. hillary clinton: the president should listen to and work with his allies in congress starting with nancy pelosi, who have expressed their concerns about the impact that a weak agreement

would have on our workers to make sure we get the best, strongest deal possible. and if we do not get it, there should be no deal. brendan: chief washington correspondent peter cook knows better than everybody that there is no deal. he joins us from washington. hillary is looking boldly into the future right now. does what she says out there make any difference where you are on capitol hill? peter: it does make a difference. if she had come out strongly in favor of the president has position on trade, it would definitely have made a difference on capitol hill. the fact that she basically sided with nancy pelosi suggests that this is going to be very hard for democrats to change their votes and back this president. it is not out of the realm of possibility, but hillary clinton basically just tilted the playing field in favor of opponents and it will resonate

in washington. brendan: the quote i read from bloomberg over the weekend is in order to pull this off, the white house is going to have to have an "epic lobbying we can." did that happen? peter: not as far as i can help. the democrats that were no's on friday are going to be no's again this week. the second could have a second bite at this apple, the right now there is no reason for democrats, who went out on a limb and bucked their president this week, that they will turn around and do it again this week. there is no sign that republicans are -- the president could also have a victory if the republicans would support it. paul ryan said over the weekend

it is salvageable. he is still optimistic, but something has to change between now and that vote. brendan: peter cook in washington, thank you. we will come back to you on that. richard haass and i both read this morning a piece in "the financial times" by larry summers. he writes -- brendan: i really like this because it says something new on trade. do you buy that? ambassador haass: not completely. the united states should support changes to the imf mechanisms and all that, but it is wrong to underestimate the importance of trade. strategically, this is big for the u.s. and asia. brendan: his other point is that the era of easy wins by dropping

obvious tariffs is over. intellectual property, things that are culturally important like japanese rice -- is it as clear that the gains from those dropping those barriers to entry, are the same as getting rid of tariffs? ambassador haass: it is very much a new trade agenda. we saw that with people a few years ago wanting to insert environment, labor. now it is issues like cyber intellectual property. the old agenda has essentially been satisfied. you can do a little more with services and agriculture, but larry summers is essentially right. the old trade agenda is more or less satisfied. the new agenda is more complicated. tom: we just sought russia with a rate cut moments ago. we had south korea with a rate cut. help me here. somebody else had a rate cut. brendan: new zealand. tom: that is the backdrop. at the same time we have hillary

clinton holding up traffic in new york and her famous line "fair trade peter: give us an update on -- her famous line "fair trade." give us an update. ambassador haass: people are taking out their frustrations on inequality and everything else, taking it out on trade, not because trade agreements are the culprit. but it is the one thing people can vote on. so you have this bizarre debate in the democratic party as though trade agreements are the problem when the issue is technology. tom: richard, the foundation idea here is trade agreements are for the elite. ambassador haass: that is dead wrong. it may be what people are saying, but it is dead wrong. we import, we consume, and millions of high-paying jobs are linked to exports. brendan: we have developed a distrust of averages. when you look at the gains from

trade, you look at an average number like gdp, which expresses what is going on for the entire country, and it may not reflect our own reality. ambassador haass: people have lost jobs in manufacturing, but the culprit is technology, not trade agreements. people are blaming china for the loss of jobs. china is not even in this trade agreement. tom: quickly -- was nafta a success? ambassador haass: absolutely. does anyone think north america would be nearly as good if it were not for that trade agreement? brendan: coming up china stocks or make collect tom keene and pulling a hockey stick. we will talk about the disconnect between gdp growth and growth in the value of stocks. we'll go to that after the break. "bloomberg surveillance" on bloomberg television, your tablet, your phone. it is everywhere. good morning. ♪

tom: good morning, everyone. "bloomberg surveillance." greece is on the move. we have not said that in weeks. widening out by 70 basis points this morning. let's get to the legitimate single best chart or. brendan: chinese stocks rose

above 10 trillion for the first time. these graphs are stunning, to use tom's words. whether it has any relationship with the economy, that is what we are looking at. the white line is a moonshot the shanghai composite. the yellow line is the economy. generally those things track each other. right now they are not. we have sean taylor, head of emerging markets at deutsche wealth management. tom: i love it because it creates distortions, which means china has to act responsibly. richard haass is with us on the council of foreign relations. there is something great here -- you do an experiment, it does not work out, it is a bubble and then you say finally they have to work it out. is that a possibility? ambassador haass: it is an experiment on a norma's -- on an

enormous scale. they has to do with demographic issues, corruption issues. it is the toughest and biggest experiment going on on the planet. brendan: at what level of economic growth does china start to begin having problems with political legitimacy? ambassador haass: i think the real numbers are in the range of 5%, about where they are now. that is why the chinese are tightening up. it is no quinton is that china has slowed and will stay slow -- it is no coincidence that china has slowed and will stay slowed for years. brendan: the deal has always been, you let us stay in power we will make you get rich. is that still in place? ambassador haass: no, that is why things are tightening up. they cannot deliver the ever increasing improvement in living standards, the communist party.

the chinese authorities are taking no risk, and this anticorruption drive is affecting stability in the country. tom: by all means necessary -- what does that mean for you? what does by all means necessary mean in terms of the chinese government? ambassador haass: that china would find what it needs around the world to support itself. either they find ways to jack up the economics so they can reestablish the old argan -- we will give you better -- the old argan -- we will give you bet -- the old bargain -- we will give you better living standards, but they do not want to have the politics or the intellectual freedom. the question is whether they can pull it off. tom: let's go to photos this morning. this is funny but it is not funny, is it? vonnie: exactly. flash floods in georgia burst

open, allowing lions, tigers bears to escape, and at least does coworkers died -- at least two zoo workers died. hard to staying in your home but at the same time you do not want to get hurt. in singapore, people dressed up in pink during the pink dot rally. singapore's annual rally, the freedom to love regarding -- regardless of sexual orientation or sexual identity. that is a big deal. singapore embracing same-sex relationships. number one in our top photos marking the 800th anniversary of magna carta. the british library of london is holding a special exhibition.

since 1215 -- it was the charter of king john. i want to tell you one thing, as part of the celebrations, the queen's barge is flowing down the thames. it is called the glory ana. tom: there you go getting sailboats into it. brendan: a sailboat is not oar propelled. tom: planes are propelled too, by engines. jim mcnerney is at the paris air show. we will speak with him next. good morning. ♪

tom: good morning everyone. "bloomberg surveillance." let's get to top headlines. vonnie: the new york prison worker accused of helping two prisoners escape will be in court today. prosecutors say she befriended the inmates. the manhunt is in its 10th day.

the company that makes the m-16 rifle for the u.s. and foreign military has filed for bankruptcy. cold defense has been in business for 179 years. -- colt defense has been in business for 179 years. mark rubin won his fourth straight decathlon title yesterday. he is a former penn state football player who spent time in training camp of several nfl teams. he clinched the victory in the decathlon's final event, the 800 meter run. there were nine previous events. let me just clarify. brendan: that is a picture of me on the rowing machine over the weekend. tom: let's look forward right now to going to europe. the boeing 747 is 45 years old.

the entire industry gathers in paris for their annual confab. it is about moving units possibly about making profits. guy johnson is with the chief executive officer of boeing. guy? guy: good morning, tom. thanks very much indeed. boeing is announcing 20 billion an indonesian carrier ordering. let's talk to jim mcnerney, sitting right next to me. thank you for your time. prices have come down sharply on fuel in the past year. if i am an airline, why do i need to buy a superefficient airplane? jim mcnerney: there are those koreans. when you buy an airplane, you

buy against your view of the distribution of oil prices, not the spot you are today because you will own this asset for 20 years. you have a broader view of what it could be. secondly, we are producing planes that are obsoleting the current fleet at a faster rate than 30 years ago. the payback at lower fuel prices for the new airplane versus the ones operating now is much faster than it used to be, and you can thank the 787 for that. guy: we are talking about what is happening with trade and what the president is up to on that subject. it looks like the export import bank will remain separate. are you confident that it is going to remain -- that it will stay with us for the time being and what will be the implication if it did not? jim: i am confident that it will be reauthorized or there was a vote in the senate last week

that, while largely procedural indicated that 2/3 of the senate would vote for the bill. that is a huge expression of interest in sustaining the viability of this bank. there are some gymnastics to get that attached to another bill but i think that is my source of confidence that this is going to happen. if it did not happen, i think it is unilateral disarmament on the part of the united states from a treaty that has 60 countries with rules that have been hammered out over the last 80 years to really prevent sort of egregious behavior on the parts of elements that have signed onto this multilateral treaty. i think that would be a real shame. i think america would lose business as a result. guy: will the fed raise rates possibly by the end of the year? what impact will that have on

the bottom line and the dollar? jim: i do not see it as a big swinger. we have been at abnormally low rates for an extended period of time. i think the projections i see would suggest a fairly gradual increase that could have marginal impact, but i do not see it changing either our customers' behavior or our behavior or our ability to finance things. if interest rates went back to jimmy carter era kind of interest rates, that is a different question. but i do not think anybody sees that? jim: let me ask you a question about the 787. you have it up and running various airlines looking at the aircraft and buying the aircraft. give me a sense of how you make money on the plane now. you have to take costs out of that production line. jim: we do. step one is to build the right airplane. the airlines that are using it

are getting the efficiency we promised and the performance we promised, and more. so this plane was really worth everything that we went through to get it done. you are right, we do have a challenge to get down the learning curve and to wring efficiencies out of the production line. but volume is the question here. no wide-body has ever gone that far. never have we had an opportunity to spread fixed costs like we do here. this is a good problem to have and we have an order book as far as the eye can see. you mentioned garuda today. it is a challenge but it is one we can handle. guy: jim, thank you for your time and your comments. jim mcnerney, the ceo of boeing. in two weeks' time, he will celebrate 10 years running boeing. that is quite an achievement.

tom: guy johnson, thank you so much, with jim mcnerney. richard haass is with us. with final thoughts this morning. what would you look for germany to do, given all the different situations in europe today? ambassador haass: the question is how they manage the grease issue and second, how they deal with what the russians are doing in ukraine. here is a country that has been on underachiever, an underperformer. is it prepared to play a larger role in europe and the world? when does germany -- almost like japan -- when do they become normal countries? tom: i cannot say enough about "foreign affairs magazine." the type is big. you can read it. i can also read the forex report.

let's do that right now. the euro, one point 1211. stay with us. -- 1.1211. stay with us. "bloomberg surveillance." good morning. ♪

announcer: this is "bloomberg surveillance." tom: greece and its creditors

moved toward realism. time is running out. as deposits run out of greece banks, tsipras carries on his back the dignity of his people. west of the islamic state, jets strike libya to kill an al qaeda terrorist. tim cook wants you to eat easily block -- wants you to easily block martin sorrells' ads. it is monday, june 15. i am tom keene. joining me, vonnie quinn and brendan greeley. i do not know where to begin. there is serious news flow. brendan: as has been the case every morning for the past four months, we have dueling headlines out of greece. tom: who is hans-werner sinn? brendan: he is the best-known economist in germany. he is very strong state, free market within a strong state.

tom: and with a vision of where germany is heading, he will join us in this hour. let's get straight to top headlines with vonnie quinn. vonnie: the prime minister of greece is running out of time and options. the latest talks failed after 45 minutes. greece will wait for lenders to become more realistic. thursday is the next meeting of euro area finance ministers. the greek bailout expires in two weeks and there is no more provision for financing. jeb bush will announce his candidacy today at a college in miami. he issued a video during the weekend called "making a difference." jeb bush: i am proud of the fact that many families have a chance to live lives of purpose and meaning. you can improve the life of people, whether it is developing the disabled stronger economy

fixing our education system. all of these things can be fixed. vonnie: he will be the 11th declared republican candidate. president obama will be trying to sway members of his own party on the trade deal. hillary clinton is weighing in after her major campaign rally yesterday in new york. she went to iowa and told the president what she thinks he should do next. hillary clinton: the president should listen to and work with his allies in congress, starting with nancy pelosi who have expressed their concern about the impact that a weak agreement would have on our workers to make sure we get the best strongest deal possible. and if we do not get it, there should be no deal. vonnie: backers of the trade bill will try for a new vote in the house and senate tomorrow.

the canadian company that owns sex fifth avenue and norton taylor -- and lord and taylor will pay $3.2 billion for galeria kauhold. and the worries beat cleveland last night by -- and the warriors beat cleveland last night by 13 points. lebron james scored 40 the cavaliers. game six will be tomorrow night. brendan: all richard haass wanted to do was talk cavs. tom: a small transaction, $2 billion, cvs over to target pharmacies. brendan: we had empire manufacturing data. industrial production numbers

are out. tom says those numbers are huge. at 10:00 we get the housing market index. we will see if we can still make money on houses. tom: futures were negative eight, now back to minus eight. greek spreads widening out as well. there is news in greece this morning, away from the dueling headlines. reese is simply saying no. the backstory is especially sharp in athens. hans nichols is in berlin. what are the opportunities for tsipras now. what are his set of outcomes over the next few days? hans: he can come up with a new proposal and that can take place in brussels. thursday all the finance ministers will be gathered in luxembourg. the issue there is will they discuss debt relief? what the greeks are clear on is any sort of package needs a long-term debt relief debt restructuring. what the finance ministers --

most recently, the belgian finance minister said moments ago that restructuring is not on the table. that is part of the conversation i will be listening for. vonnie: we just had richard haass saying the only way this will be resolved is to give the greek people the decision to stay in or stay out, that will give the government and mandate. hans: that is a viable solution. the problem is, up to this point the greek government has denied they are considering it. the government said they would not call a referendum and they would not call new elections. they say series of -- syriza has the place to go to greece -- to govern greece. syriza could backtrack and accede to demands they did not want to take earlier. that talk seems to have died down. there does not to seem to be

much referendum talk at least in berlin. tom: joining us in a minute is hans-werner sinn, some say the leading economist across all of germany. how coalesced is germany right now? is the germany of 2015 the germany of 1989? hans: at least in terms of the small businesses and the industrial engine that drives germany forward -- dr. sinn is an excellent barometer of that. politically things shifted over the weekend, where the spd is firmly in merkel's cap in their approach to greece. there is an op-ed over the weekend, talking about laying a pretty thick and heavy on greece. not a lot of daylight among elites. tom: the challenges of greece against a global backdrop -- we saw a rate cut with russia moments ago. martin sorrell knows that

america cannot go it alone. he just returned from china europe and you are in western -- >> i was in the middle east actually. tom: within the fractious area of the middle east. >> saudi is doing very well actually. you see the shift from beirut to dubai. beirut used to be the center, and then it went to dubai. a lot of our business is now coming out of saudi. tom: do you wake up feeling a world bank global 2.8% global gdp? >> actually, there is a big discrepancy between what you see at the business council, the international business council and people who are running

businesses are much more conservative and pundits like you or goldman sachs or whatever. they come down to where the people who run businesses are. i would say the world is running around three real, about five nominal, and has probably weakened in the second half of last year and the first half of this year. it is not a pretty picture. clients are focused on the short-term. it is the 800 anniversary of magna carta. i read a specious piece on magna carta and it's implications for business. where i did agree with them is this emphasis on the long term. the problem at the moment is that people are too focused on the short-term. larry summers is right -- focus on the long-term. 2014, total buybacks plus dividends exceeded paid burns.

companies are not willing to take risks. tom: how will that change? martin: i hate to be gloomy, but i do not see a breakout. i can see a focus on cost. what you do see is amid a activity. -- what you do see is m&a activity. there is slower growth, still faster growth in the mature markets, which ironically we are looking for growth in western europe. our own figures were stronger in western europe in the first six months of this year, first five months of this year. that is the irony, but it is not sufficient to give you topline growth. when you run out of cost options, you focus on m&a. vonnie: what are you hearing about your plans with the weaker euro? how are you planning going forward?

martin co. i was in -- martin: i was in italy in the last week. what was interesting was we are seeing signs of growth. i disagree with richard. i think germany is much stronger. the russian problems mask the underlying growth in germany. our german business is very strong. we are seeing signs of improvement in spain sometimes in italy, nothing in france. brendan: i have to jump in here. saudi arabia just opened up its stock exchange to foreign investors. we will go live to riyadh next. this is "bloomberg surveillance ." ♪

tom: good morning, everyone. "bloomberg surveillance." there is a little weight to the market. let's get to an important morning must-read with brendan greeley. brendan: this is from christopher minns, who is worth following on twitter. he wrote in "the wall street journal" this morning -- brendan: we have sir martin

sorrell with us. martin: the idea is you share sales forces. rendon co so you say i need to go out and have someone pitch this. martin: it is much more broad and available, but the idea of contract sales forces, not new. brendan: the argument against this is the value of training. you hire a sales force, you bring them in -- martin: middle focus. brendan: you give them corporate values. is there a value for that? martin: i think for startups it makes sense. if you cannot afford an investment sales force, a fixed costs involved, you cannot afford it in the early stage of development, you take it up. when you get big enough -- vonnie: the links between employer and employee -- are they getting ever more frayed?

martin: partly because of the pressure we talked about before. we are involved in a major effort with ibm to process simplified to common processes offshore and outsourced where it is not core competence. the answer is yes. you are seeing more sharing and flexibility in the economy, and in a slow growth environment that is inevitably going to be what people go for. tom: in mergers is sg in a in synergy that is sg and a in synergy -- is sg and they in synergy? martin: look at the so-called new models -- 3g. i learned about zero-based budgeting 50 years ago. it is nothing new but core lehman and the brazilians are figuring that out. i find that a bit of an

oxymoron, because you have the pharmaceutical company that -- tom: we are talking about the rigor of the corporate world. it is not going away. martin: and this sharing of salesforce is -- brendan: we are going to go to germany next. we have the president of the -- we have hans-werner sinn with us. this is "bloomberg surveillance ." ♪

tom: good morning, everyone. "bloomberg surveillance." let's get to top headlines. vonnie: conflicting claims after the u.s. targets olivia militant. moktar was reportedly killed by an airstrike, but he is said to have survived. he is linked to al qaeda and is blamed for an attack two years ago in algeria that killed 35 hostages.

the fight between boeing and airbus this weekend resumes at the paris air show. they are prepared to announce deals with $23 billion. the orders are from narrow-body jets. leasing companies are expected to be the biggest buyers. the first ever probe to land on a comet is waking up. its batteries died last november, but they recharged when the, moved close -- when the comet moved closer to the sun. those are top headlines. brendan: i love scientists. moving to riyadh, saudi's capital market authority has opened the stock exchange to foreigners -- kind of. wilhelm marx is in riyadh. they can only take 5% of any

saudi company. if the saudis are so reluctant why are they doing this now? >> i think a lot of people have been saying that this is an opportunity they have been looking at for the last seven or eight years since they first allowed etf trading in particular. this is an opportunity for companies to improve corporate governance. i spoke to the head of the general investment authority yesterday, the organization charged with ringing foreign direct investment into saudi arabia. and he said when -- he said it is all about financial institutions that are qualified bringing in quality investors. he wants these kinds of investors that are going to improve corporate governance. brendan: it does not seem like there is a new urgency in saudi arabia. how much do you think this is pinned to the drop in oil prices?

willem: no one will say that on the record, but there is clearly a sense among some people that there is a reason why this is the moment for that to happen. i asked this guy from the general investment authorities -- really the only government official i have been able to talk to on the record. i asked him why this is taking so long and why it is happening now. he smiled and said it is timing now. tom: how much of this has to do with leadership change in saudi arabia. the council on foreign relations had an important seminar this weekend on how significant that is for the nation. how much of it are we seeing within their finances? willem: a lot of the bank officials have said there has been a sea change that this is a priority they are focused on by diversifying their economy.

in some ways this will bring in new talent, potentially new ideas, potentially new management teams. this seems to be something that is a broad shift across the economy. martin: they are building a 100 million -- a $100 billion economic city. tom: is this riyadh dubaizing its economy? martin: it is. abdullah's economic city is a good example of that. tom: but the rest of saudi arabia will be removed from that city as they are now -- martin: it is intensifying its economic development in that part of the world. saudi arabia is the lead economy in the middle east. the tensions surrounding saudi arabia and elsewhere obviously

undercut that. having said that, this is another example of how the economy is slowly opening up. brendan: the door is opened, but just cracked. $5 billion is already under management, and you cannot own more than 5% of a company, no more than 49% in total. why these restrictions, and is there any thought to getting them lifted? willem: there is certainly the possibility of opening a private company with foreign ownership. not a public listed one. security is a concern. also real estate. if you are trying to invest in a real estate company, you will run into difficulties. in terms of further easing restrictions, these are hurdles here. people do see this changing two or three years down the line

potentially. but that is speculation. brendan: thank you. you were just in riyadh, martin. one of the purposes of opening a stock market is to improve competitiveness. can that happen? martin: it is something they are keen to do. the plan is the biggest there of its kind of facility around the world. they are making big efforts, but there is this tension or sort of paradoxes that they want to open it up and maintain control. for security reasons -- not this similar to the chinese. brendan: will this improve governance? martin: ultimately it will. i think large institutions will overtime. brendan: coming up, we are going to berlin. we have hans-werner sinn arguing loudly and frequently for a greek exit.

we will go to him next. this is "bloomberg surveillance ," on bloomberg television. good morning. ♪

tom: good morning, everyone. "bloomberg surveillance." tom keene with brendan greeley and vonnie quinn. it is a nexus of economics and politics in europe. hans-werner sinn is the president of the -- institute.

this morning it is decidedly germany and europe in flux. good morning. how far apart is the germany of merkel from the germany of short chauble? dr. sinn: schauble is more skeptical. he things pouring money is not a solution, it is just fighting against the symptoms. brendan: you said this morning that he is willing to accept a euro exit of greece and to write down what has to be written down. how do you know that to be true? dr. sinn: this is my suspicion. i do not have any particular knowledge, but it is time to face the truth for the creditors

to accept that the debtors are bankrupt. why is it bankrupt? it is bankrupt because it lacks competitiveness because it has become too expensive in the inflationary credit bubble which the euro brought. that is the fundamental problem. they have to come down with their wages and prices are exit and the value. brendan: you said that the drop in the drop, would increase -- in the drop would increase europe's competitiveness. dr. sinn: i do not think it is so bad. the capital will in fact return. people will buy realist aid to

reconstruction. also the devaluation means that the greek people stop buying expensive imports and move toward their domestic suppliers, which gives a boost to the domestic economy. tom: when does this become a political debate as all good economics finally does? dr. sinn: it is all politics but i of course see it from a political perspective. i think it is not enough to just give new money to greece because the fundamental problem of the lack of competitiveness needs to be addressed, and you cannot give money to an economy to make it competitive. to the contrary, you create a situation where you are permanently dependent on foreign credit, which keeps your wages

above that level. tom: so if a dutch disease is upon us, what will be the catalyst to get what you want and many others, which is a restructuring? how do we get from the silliness of the debate now to the restructuring? dr. sinn: a restructuring of debt, or a restructuring of the economy? tom: well, both, but a restructuring of the debt. dr. sinn: a restructuring of the debt is necessary. if greece declares default, that will automatically be a restructuring of the debt, because what can creditors do? they have no way to negotiate this away. they have to write off some of their claims. brendan: the german can description -- the german description of competitiveness is something you have been a big proponent of an major politicians have been a big proponent of. it has fallen in a lot of countries in europe on deaf

ears. how do you make it more appealing to the democracies of europe? dr. sinn: i would advise everyone to look at the history. our institute has studied seven economies in the world where the states went bankrupt. in nearly all cases, did we see an upswing after one or two years? the same result was found by oxford economics in a study recently. why don't we believe our eyes? tom: hans-werner sinn from berlin. let me do a quick data check here. we were negative eight negative seven on futures. there has been a deterioration in the last 20 minutes with nymex crude well under 60. looking at greece spreads, i

will not go into the details other than to tell you today we finally have market response to what we have seen in greece over the last week. greece spreads out 80 basis points this morning. futures now, -10. brendan: this is bloomberg surveillance. i am brendan greeley with tom keene. the race for 2016 has gotten very hot. hillary clinton held her first campaign rally this weekend on roosevelt island. governor jeb bush is expected to announce his bid for president today in miami. phil mattingly joins us from washington. what are we expecting to hear from jeb bush today? what does he need to get done? phil: optimism. when you look at his campaign ads and his videos, he will try to prevent himself as the candidate who is above the dirt slinging, above the pc obstruction. what you will see today is how he tries to do it with a

dual-pronged approach. he has the candidate talking about positive things solutions. his team behind the scenes is really trying to take on his rivals, most notably, scott walker and marco rubio. it will be interesting to see how he starts that process in the speech today. rendon tell in the videos jeb has released ahead of time, -- brendan: in the videos jeb has released ahead of time, is it fair to say that he is being kinder and gentler? phil: i think his campaign would love for you to say that. people do not actually know who jeb bush is. they know of the last name. they know the legacy of the family he is from but they do not know him as the governor of florida or where he stands on policy issues. they feel if he can get in, he

can win. they are going for the kinder, gentler image. brendan: phil mattingly, thank you. we'll bring in the former lieutenant governor of massachusetts under mitt romney and currently the president of the college. you were just with this -- at this retreat. what is the one word owners are looking to hear from candidates? >> it is about growing the party and creating opportunity in america, so again, very much like you were just saying about bush's message. the message was about kindness and expanding the pie. tom: how does jeb bush get away from the wesley hills country club? -- the wellesley hills country club, which identifies traditional republican politics?

this has not worked. how does he change it? kerry: i think you will hear a lot about his education record, and he will shift the debate other than some of -- away from some of the traditional republican topics. tom: can he do that in the primary? can he get from the primary to the general election? kerry: i believe he can. all of the candidates are talking about living the american dream, so they want to talk about how you get there. education is how you still get there. brendan: there is a whole basket of what he did in florida -- rating schools, charter schools as well. that was adopted by indiana as well. how do you add to that platform? keri: it is about closing the achievement gap. creating that pathway from

better schools into higher education. brendan: i just realized that we are talking jeb, jeb jeb. is that mitt romney's favorite candidate? kerry: we saw walker and rubio and christie and many others. martin: i think hillary clinton is the most powerful female president -- how does he counter that? kerry: everyone wants to believe that america can still be that positive place of opportunity. the other major topic of discussion this week and was foreign policy and how obama's foreign policy has been such a failure on every corner of the earth, and hillary has a part to play in that. tom: is it true that bastion colleges giving of its tickets that giving up its tickets?

brendan: governor kerry healey. coming up, jeb bush announces his presidential bid at 3:00 p.m. eastern. this is "bloomberg surveillance ." good morning. ♪

tom: good morning, everyone. "bloomberg surveillance."

on tom keene. with me, brendan greeley and vonnie quinn. dow futures, -88. brendan: olivia sterns is sitting with us back on the desk. good morning. olivia: good morning. the first thing we will talk about is greece and to what extent he has contingency plans for coping with -- the rhetoric has been ramping up. it is becoming more likely than ever that greece could possibly leave the eurozone. we will be talking to sir martin gilbert about what aberdeen asset management is recommending to his clients, how they are positioning themselves for further volatility in europe. we will talk about something very near and dear to the heart of tom keene, liquidity in the bond market. tom: it is a concern. brendan: we know just how big of

a deal it is. paul krugman has already jumped in to say it is not that big of a deal. that is how big of a deal it is. olivia: the volatility at this point is incalculable. yields on the german 10-year went from five basis points to 1% in a matter of six weeks. a lot of bond managers are trying to figure out if you have to price in more risk their it do you deal with this? how do you strategize for it? maybe you have to play duration differently. brendan: this is something that the oversight council in the u.s. is worried about. daniel tarullo said recently that they are studying this, the october 15 phenomenon where there was a loss of liquidity in treasuries. vonnie: and you also have the

ukrainian prime minister. olivia: yes, petro poroshenko. we will have a live interview with the president of ukraine. there is lots to discuss with him over the weekend. reports of fighting where -- new reports of fighting, where one serviceman was killed. brendan: there was a security conference in poland, where the atlantic council report says it is war. the russians are absolutely doing this. olivia: all that is true. over the weekend this -- the u.s. decided to station heavy weapons in ukraine. short of sending deadly aid, the other thing that we will ask president poroshenko about -- even if the country cannot pay its debts, the imf will continue to support ukraine. tom: olivia, thank you so much.

she does not get up like we do anymore. brendan: how is that? olivia: fantastic. brendan: coming up, an exclusive interview with ukraine's president poroshenko. this is "bloomberg surveillance ." we keep our assets right here. good morning. ♪

tom: good morning, everyone. "bloomberg surveillance." let's get to top headlines with vonnie quinn. vonnie: the prison worker accused of helping two killers escape is due in court today. prosecutors say she prevented the inmates. the manhunt is in its 10th day. new york's governor -- the company that makes the m-16 rifle is seeking bankruptcy process can. colt defense has been hurt by delays in government sales and falling demand. cold has been in business is cold and -- colt has been in business for 179 years.

no one disputes who wall street's best athlete is. mark rubin won his fourth decathlon yesterday. those are the top headlines. you want to be fit if you are going to be out there with traders, right? brendan: i am waiting. as you all know, tom and i every morning at 8:15 go on a five-mile run. tom: we do. advertising -- it is going to according to plan, except when it isn't. how do they respond to digital messaging? we are blocking ads. twitter is not doing so bad as well. who exactly result is digital ads? martin sorrell is an expert in this the chief executive officer of the digital troops at wpp.

tim cook says enough. martin: they are introducing a blogging technique on the safari browser on apple. it is about 20 per -- it is about 25% of the market. we think it will affect 5% of mobile advertising. the other big point -- it raises the cost of content by reducing the amount of advertisers. if it does, consumers will have to pay more. microsoft tried that a few years ago. it did not work. it has always been a question about free subscription or advertising. netflix is subscription. although they are starting to cross platform advertise and even have talked about sponsored programming. even the ad-free models built on the concept that people do not want to watch advertising, they have had to compromise in some

way, shape, or form. tom: do we look at digital ads the same way we used to look at tv ads, when we got up and went into the kitchen when the ads came on? martin: we believe there have to be stricter standards for view ability online. on the one hand you have nielsen having this problem offline with measurement, where we are seeing viewing statistics falling. why? because we do not capture all the viewing, c-plus seven, seven days after insertion, rather than three days after like nielsen is doing. online has to have stricter view ability standards to make sure that people are really connected with the ads, as you say. brendan: what are the demographics of people who opt in to add blocking?

martin: i have no idea. in the early days of dvr, when we found people had the option of checking out of advertising, they did not actually take it. those people who were really into pvr's, into online activity, they did not. i am not sure there is a demographic. when you see things like snap chat and you see that grow -- snap chat is taking advertising. the most popular centennial -- brendan: i wonder about education, that you have to understand how the system works stopped out. if you could afford a $10 facebook subscription fee, a whole raft of advertising clients disappears. martin: the whole thing about the apple technology is it is based on an option basis. to get there, you have to go through a number of things.

you have to install add blocking technology. i think it will have limited impact. tom: so you are on the sorrell gulfstream out of germany. martin: i wish. tom: what do you tell those guys about digital messaging? what i do not get is where is this in five years. martin: james has legacy assets and new assets, so what he has to do -- tom: and he is the new new. martin: whether it be newspapers or television into the modern era the cfo of twitter has an easier task because he is a p year -- he is a peer disruptor. we are trying to do three things, tom. one is get our legacy assets to

become more digital. one is to make sure digital assets are going as rapidly as possible, and then experiment like hell to do with the paranoia that we all have to deal with when you have a legacy business. brendan: aren't you also moving into apps? it works on chrome and on safari. martin: not on apps. brendan: most of where we spend our time is actually in apps. martin: that is another reason why the apple move is not significant. you are absolutely right. the issue is, i think a much more fundamental issue is -- say netflix, with the biggest production budget in the world does not make money. how are they going to fund? is it by increased geographical presentation? is it by increasing subscription prices? they tried that and they got hit.

tom: where is the guardian in five years? martin: i did a panel on the guardian. it is a big challenge. the guardian is very different. its objective is to maintain the guardian. it is a charitable trust, it is run on a totally different process. they sold digital assets. they sold auto trader and missed out on 400 euros or 700 euros value. brendan: we are all in this business dealing with -- martin: bloomberg of course is a wonderful business. it is the arch disruptor. brendan: tom, big news day, a lot going on. tom: i just think that was a fabulous window into the digital debate with martin sorrell. greece is there. and on friday there was a much of headlines. brendan and i go back, mike

mckee and i on radio, going back and forth making jokes about it. the jokes are off on monday morning. this is serious. watching the greece-german spread. that is my thermometer. vonnie: i am watching ego data. we get an update on manufacturing. it is the number for june, and we expect that the increase. also, industrial production will be an important number, moving back into negative territory. brendan: and of course all this economic data will be seen through the lens of the presidential campaign. my agenda, jeb bush announces today. tom: sodas jeb bush. brendan: he would prefer that you call him jeb. he is the former governor with that last name. the question is, is that a handicap and advantage? is this the same republican party that can coalesce around a dominant front runner? it has to do with how he finesses his own last name. tom: very good about the

distinction between the primaries and the actual race. vonnie: that was the question that we posed to you all out on twitter. ken jeb out run his family? let's get to the first answer -- brendan: i had not heard that. vonnie: in the morning, they are still there. tom: this is from mr. weiland. someone as cynical as chris whalen would say that. chris whalen can spend that can spell famiglia because he has been there six times this weekend for pizza. brendan: amen to that. tom: can you imagine a third adams?

john adams, john quincy adams? it would be like having a third george or something. we are going to have a george. stay with us on bloomberg radio and bloomberg television. good morning, everyone. ♪

>> live from bloomberg headquarters in new york. this is "market makers," with erik schatzker and stephanie ruhle. erik: in good morning on this monday in new york city. you are watching "market

makers." i'm and schatzker. olivia: and i am olivia sterns in for stephanie ruhle . erik: if you minutes, you will hear from martin gilbert on his take of the greek standoff. olivia: and an exclusive interview with petro poroshenko on the russian backed rebels fighting and his country and his message for the united states. erik: time for our top stories of the hour. one of the biggest drugstore chain is buying targets pharmacy and clinics. cvs is buying target in which it will operate as stores within the stores and branded as cvs pharmacy. target has many clinics that will be rebranded as many clinics. the fight between boeing and airbus resumes. economy announced $20 billion in orders for neri body jets.