forget one laptop per child. let's all try one teacher per child. good morning. this is bloomberg "surveillance" in new york. this is thursday, june 18. tom keene is out to me. out today. vonnie: he is out to you. brendan: joining me are vonnie quinn and mike mckee. the news out of trust and is stunning. it is hard to fathom. there are nine dead outside of the emmanuel ame church. the police chief has called it a hate crime. vonnie: he's holding a press conference now. we will bring you the latest headlines on what is going on in trusted. it is not the first time charleston has seen a tragedy this year. mike: the scott shooting. this comes after that. that is spent trade in racial terms. brendan: it is one of those things that is normally our

story, but it is america story. it is impossible not to talk about it. vonnie: there is a manhunt in charleston, south carolina, for a gunman killed people into the church last night. the shooter opened fire in the church for the gun man is white. trust is police chief was asked about a motive. >> i do believe this was a hate crime. >> is that why the fbi is investigating? >> they will investigate it, but the fbi would be here regardless because of the size and scope of the investigation. there are -- they are our partners. they will be here to help us regardless. vonnie: the shooter is described as a white male in his 20's. fbi agents have joined in the investigation. the church is emmanuel ame in downtown charleston. one of the victims was the church's minister and a member of the south carolina state senate. greece is at a crossroads today. european finance ministers meet in luxembourg to reach a deal on the country's debt that would unlock a lot funds. alexis tsipras says he will not give in to demands -- but the

bailout expires in two weeks. without a new deal, greece may not be able to pay its bills. angela merkel said a deal on greece is possible but only if greece follows through on its promises. merkel i'm still convinced where there is a will, there is a way of the political leaders in greece show this will, in agreement with the three institutions is still possible. vonnie: the institutions are the imf, the ecb, and the european commission. greece needs to pay the imf $8 million u.s. dollars by the end of the month. cautious on the was economy. one interest rate increase would be enough this year. they are advocating a go slow policy next year. janet yellen says she still was to see more decisive evidence that the economy has turned around. wage growth is "subdued" and there is a cyclical weakness in the labor market. fitbit begins trading on the new

york stock exchange this morning. it raised $732 million at the ipo price. fitbit is valued at $4.1 billion. jpmorgan vice chairman jimmy lee is being remembered as a rainmaker who put together some of wall street's biggest deals. lee died yesterday. he pioneered the use of leverage loans. he advised ideals such as comcast, nbc and gm's ipo in 2010. jamie dimon said simply he was in incomparable force of nature. g-v the d -- jimmy lee dead at 62. only last week he was at the economic forum in new york. mike: if you do not know jimmy lee, you knew of him. when i saw the headline, like everybody else, you did a double take. people who are larger-than-life are not supposed to die. brendan: there have been so many

memorials pouring in. we had a couple of phone calls with people who knew him. for me, what has been fascinating is reading into the history of the syndicated loan. somebody had to come up with that idea. if we do not have money, we can get the money together. it takes somebody like jimmy lee to do that. vonnie: it seems like it has been there forever. somebody created that idea. brendan: let's take a look at what is in the data this morning. futures are up a bit off news yesterday from the fed. no news is good news. two year yields down. the euro surprisingly up. we are waiting for the shooter drop in luxembourg. we will go there and a second. crude not doing much. second board, please. bunds down. greek government also down. pretty much everything down in europe. again a sense of caution.

we do not yet know what is going to happen. it is if we are tired of trying to figure it out until real news comes. we will have real news today we hope out of luxembourg. angela merkel says a deal is still possible if greece wants one. she spoke to the bundestag today. hans nichols is in luxembourg. euro area finance ministers are meeting their today. angela merkel read from a february 20 proposal from greece . then she said, i'm going to leave it to the finance ministers. that's not what's on the table today? they are not going back to that february 20 agreement? hans: according to angela merkel, they are not n-- going to offer anything new. she did not make a new offer. she did not say here is something new for the greeks. even rhetorically, she do not have much news. repeating her own lines.

yes, she will meet them halfway but they need to get serious. real quick there is a breaking story out of an english newspaper in athens. they are reporting, according to the anonymous sources, that the european union and the european central bank are preparing a statement on debt relief. let makes plain why that is important. because if you have some sort of longer, it would be a way to break the logjam. if you have a grander theory and offer greece the idea of long-term debt relief, that may entice mr. tsipras back to the negotiating table. i stress we have not confirmed this. this has just broken. vonnie: a possible debt relief statement. will this be seen as a capitulation? could this be a resolution? hans: well, yes it would be a capitulation in terms of timing. no one doubts any long-term deal for greece is going to have to

do something about the burden of their overall debt. but what everyone wanted to see was that greece actually abide by that february 20 agreement even initial bailout program the second bailout program. the line has always been with more structural reforms, more help. this seems to indicate they would offer the promise open overall reduction of the debt burden before greece has committed to any structural reforms. the reforms that frankly they committed -- the current government the tsipras government -- committed in a february 20 statement. when the last time i had a late night in the lowland. brendan: like a dead head chasing the greek crisis. in the u.s., janet yellen reminded americans we have exposure to the euro but not that much to greece. the fed open market committee gave us a presser and a bunch of

dots. michael mckee happens to be with us. what did you see? mike: the dot charts. it is how you interpret the dots. traders who have not see the rate increase since 2006 focused on the 2015 part of it. the median forecast did not change. fed funds trading at 63 basic s points. economist the citigroup say if you couple that with yellen's comments that inflation is going to rise, that means two moves starting in september. but on that dot plot fewer people may hire forecast, more made lower forecast. there are those on wall street including the folks at goldman, who think that coupled with janet yellen's comets she needs decisive evidence means way they will not move until december. at the moment, the markets, that seems to be the prevailing view.

let's see if that holds through the cpi. neither is the point that janet yellen wants to make her she wants to focus on the path of interest rates going for it. yellen: the importance of the timing of a first decision to raise rates is something which should not be overblown, whether it is september, december or march. what matters is the entire path of rates. as i've said, the committee anticipates economic conditions that would call for a gradual evolution of the fed funds rate towards normalization. mike: the dots for 2016 and 2017 moved lower. 25 basis points at a time. brendan: there is a question, do you pay attention to the dots? vonnie i was struck by a note that i read yesterday that basically said traditionallly,y the more the fed talks about pace, the more likely it is they

will make the move soon. vonnie: very interesting, the question of one or two rate increases. and we should mention the lower gdp forecast play into the -- mike: the fed has been criticized for being behind the curve. brendan: let me jump in because i'm being criticized by the control room for not bringing in our guest. we have for the hour a professor of finance at chicago. he is the author of a capitalism for the people recapturing the lost genius of american prosperity. that does not begin to describe his work defending free and fair markets. luigi, the story of this fed has been a shift from focusing on price to focusing on labor. what have we learned broadly in the last two years about how to study labor? luigi: so, i think that we have

learned that one of the biggest problems is the employment is down, while unemployment is down also employment is down. it is very difficult to bring people back to work. i think this is a structural softness and labor market, which is a problem. so, if you look at the unemployment numbers, you wonder why they are n ot increasing rate sooner. if you look at under it -- other indicators, comedy before, that is pretty low. brendan: do you thnkink people on wall street, our audience, understand this focus? they seem impatient with it. luigi: i think they have -- it has not been communicated enough. but i think they are slowly getting it. mike: we have the participation rate declined because people are retiring. how much can monetary policy due to bring people back in? is the fed's policy working

anymore? luigi: it is not just retirement. the shocking factor. if you look at the male, not because women are not important, but there are factors that affect this does if you look at males in the prime age the fraction has gone steadily down since the 1980's. every recession, this goes down. then does not come back up. there is a debate, what are people doing? brendan: the workforce precipitation -- participation rate for women has declined since the 1990's. we will talk about the fed all morning. now we take a look at our twitter question of the day. we asked the day after the fomc how many times will the fed raise raites thi -- rates this year? one or two. this is bloomberg "surveillance" . ♪

brendan: this is bloomberg "surveillance" vonnie: here is what you need to know. there are reports that last year hold become the permanent anchor for nbc nightly news. one was was suspended for exaggerating his role during an attack on a helicopter in iraq. what was with stay with the network. he'll move to msnbc. there is a new threat to uber. california's labor commissioner says a driver ais an employee not a contractor. uber could be forced to guarantee drivers a minimum wage and pay into social security. uber plans to appeal. the u.s. open gets underway in washington state. one of the favorites -- rory

mcilroy. he's won three times this year, but he missed the cut in his last tournament. players are concerned. some say the fairways could -- i feel like there's always a complaint. when you get onto a new golf course. brendan: absolutely. pros complain about the surface. same in soccer. mike: we can talk about that later. vonnie: if you called up central casting and you said sunday a banker, they would send somebody like jimmy lee. . that is how he was described he passed away yesterday. jaonson kelly is bloomberg's new york bureau chief. i love how you described them in your writing today. jason: this was a guy who truly was a -- of every major

deal that happen. he helped invent the modern private equity business and gave us the characters we know today. vonnie: he created the syndicated loan. we did not have that before him. jason: it is one of these things we take for granted on wall street now. private equity firms take it for granted in terms of how they put together deals. a private equity deal needs borrowed money. that is the leveraged in leveraged buyout. what jimmy did, he was the guy who rounded all that up. brendan: syndicated loans are such a foundation of what happens, it is hard to believe that somebody had to come up with the idea. let's you and i find the money. jason: if you play it out from the late 1980's on, it leads to what we saw in terms of the biggest deals of all time. brand name's being bought by the

likes of blackstone and kkr. brendan: we could not have a better guest than luigi. this is exactly what your work has been about. our -- are leveraged buyout's good for america? luigi: i think on average, yes. they have contributed to the transformation of the banking industry in a way that we've not seen in europe. one of the reasons why the labor market is -- the economy is doing better is because the united states has transformed fast and the leveraged buyout helps that. vonnie: the jpmorgan flag is at half mast today. he said you opened your first chemical bank account. mike: he started at chemical bank in 1975. two years later, i had my first bank account. vonnie: he was at jpmorgan

before was jpmorgan. and he almost went to blackstone. jason: he did. he is very close with steve schwarzman. they had done many deals over the course of the 192090's. steve approached jimmy be my number two. they came within days of doing it. that job eventually went to tony james, who has been at dlj. blackstone has gone on to do amazing things. jimmy really leveraged a lot of the work he had done in private equities to work on massive ipo's like alibaba and facebook. also at the center of some of the biggest takeovers. dell. worked on that, too. brendan: our bureau chief. familiar with the history of jimmy lee. this is jimmy lee describing the

dell buyout. "it's like going into a haunted house, and every time you go run a corner, some ghost pops up." this is bloomberg " surveillance." good morning. ♪

brendan: this is bloomberg "surveillance" vonnie, you have got a morning must-read. vonnie: it comes from stephen l carter. you clal that -- call that dynasty? perhaps the three generation requirement is a corruption of

the domestic dioidiom. it seems we do these great houses a disservice when we use the same word to refer to political family sues a couple schmitt are contained entirely within living memory. the reason i bring up this quote is because we have the professor here this morning, who has a lot of thoughts about dynasty and corrupt dynasties. we look at the problems that europe is having. is it political families of problem? luigi: i think political dynasties tend to be associated with an environment which is not very competitive and often corrupt. so in the united states -- they are emerging in the united states is not a good sign. brendan: are we looking at dynasty? luigi: we will probably have bush v. clinton again. that is not a good sign.

mike: is it something culture within europe that produce corrupt dynasties? no one's accused the clintons or bushes of corruption. luigi: when we talk about corruption, we have to distance between bribes and institutional corruption which is legal, but nevertheless is not good. brendan: so, your concern is not that the families themselves are corrupt, but we cannot help but adopt a dynamic where the system is corrupt if there are families inheriting titles. luigi: there is not enough mobility. dynasties is an indication there is not enough mobility, because -- the children of powerful people -- otherwise, the moniker he would've been a fantastic system. why this is a republic?

because anybody can become president. brendan: that is the point of my day. otherwise the monarchy would've been a fantastic system. mike mckee, you just said the words that nobody accused the clintons of corruption. i am certain that somebody -- mike: " surveillance" correction. brendan: our twitter question brings us back to the fomc. how many times will the fed raise rates this year? you have two options. ♪

in charleston, south carolina for the gun man blamed for a deadly

shooting in a church. a white man killed nine people and wanted another at an historic black church. police are searching for the shooter has described as a male in his 20's. one of the victims who is the church's's pastor was a member of the south carolina state china. -- state senate. >> it is senseless and unfath omable that somebody in today's society would walk into a church when people are having a prayer meeting and take their lives. and i can assure that we are going going to do everything in our power to find this individual, to lock him up, and make sure he does not hurt anyone else. vonnie: the fbi has joined the investigation. the suspect is described as a truly dangerous. in luxembourg, european finance ministers will try again to come up with a deal to unlock bailout funds for greece. the bailout expires at the end of the month.

greece is balking at demands that it raise taxes and cut pensions. tsipras is in st. petersburg to meet vladimir putin. that led to speculation the greeks may be seeking russian loans. a vote expected today they could selfish president -- salvage president obama's trade plan. democrats say the asian deal what hurt american leaders, but republican leaders are working the proposal to get democrats on their side. powell -- a judge ruled on a request from the silicon valley capital venture firm she sued. a jury ruled against pao in march. they call the case regrettable and say it is time to move forward. he talked about it with emily chang. >> i'm sorry this happened to

ellen. it happens to the tech industry. this is not a question of guilt. the question is liability. the jury found we are not liable after five and half weeks of testimony. vonnie: to see the entire interview, join us tonight at 7:30 eastern for " studio 1.0." sorry, alexander hamilton, looks like you're being replaced on the $10 bill. it will feature the first woman on the nation's currency in a century. the new bill will be unveiled in 2020 the 100th anniversary of the passage of the 19th amendment. by the way hamilton is not completely out. he may end up appearing at some of the tens. mike: it is part of the instructions that the treasury secretary gave to the bureau of engraving and renting, keep

hamilton in there. brendan: he said this is about security. we need more secure 10 dollar bills. mike: i was going to nominate vonnie. we need somebody -- brendan: likely born in america. vonnie: i will not run for president. brendan: in january this year luigi walked in to a bar and opened with one is possible the rudest question he could've asked, does finance benefit society? you might say he is working from the inside. mike mckee and i were at that conference. we missed her speech when you insulted the entire room. we must've been out getting a drink. let me turn your question on you. does finance benefit society? luigi: it does but i think our

own view of the benefits might be overstated, and in particular, we do not explain enough to people what we are doing good and we are criticizing enough what we are doing bad. brendan: how do we draw the distention on this table when we talk about finance every morning -- how do we draw the station? how do we tell -- how do we draw the distinction? luigi: i think it is difficult to do on a daily basis but the point is that a good financial system is really crucial to a well-functioning economy. however, not every activity of the financial system is really a benefit to the economy a large. as academics, we have to be mor critical about the subject we study. vonnie: this is something that

the professor robert schiller of yale concentrates on. the beneficial characteristics or lack of them in finance. is regulated finance a good thing for society luigi: i think we need rules to make the market work. the idea that markets can work without rules is wrong. now, the fundamental problem is who designs those rules. and are they designed to favor somebody? i think too many rules are designed to favor somebody. brendan: you talked in your speech about the role academics play. did they come up to and say, i've been waiting for somebody to make the sergeant? -- make thias argument? luigi: i had a lot of people being very pleased. a few young people said, thsi spes speech gave me the courage to

do research. that is the role of the speech. to give younger researchers a direction. mike: you put together the financial trust index. americans do not really trust their financial system, although it is better than it was after the crisis. what does that imply for the way society works? luigi: if you lack trust, you are less likely to invest in the stock market. reduced participation which is a key element to both reduce the cost of capital but give people an opportunity to invest in the stock market. so, to retire early. so, i think that is one crucial element. the other is politically they might sort of lobby or be active to try to limit the role of

finance. so, one of the big problems i see and i discuss is that finance works well only when there is a social consensus on its work. and if we don't create a social consensus, the backlash can be negative. brendan: without that you have an arms race. you have the popularity of bernie sanders at 22% in new hampshire against the arms race of lobbying in d.c. vonnie: the federal reserve has not helped in this in error? luigi: i think it depends on what actions. i think that the federal reserve took a lot of extraordinary action during the crisis. some of them were helpful to stabilize the economy. some of them were sort of aggressive and not always well explained to the public. and i think this diidea that they ran the country on their own i

think is pretty scary. brendan: i have never said these words, but this presidential addresses worth a read. coming up, it is quitting time. more americans are walking out the door on their employees. we will show you what that means. that is today single best chat. this is-- this is today's single best chart. ♪

tom:brendan: this is bloomberg "surveillance". mike, you have the single best chart. mike: this is all about quitting. this comes from deutsche bank chief international economist. the charts shows how people are voluntarily quitting jobs. the number of people will feel secure enough to leave their jobs and look for another one has risen over the last for years and back to where we were when the financial crisis was getting underway. at the same time that interest rates have remained pegged to zero. you notice how they tracked the quit rate well. now people are leaving their jobs but the fed hasn't move.

more evidence the fed is starting to get to the point where it feels behind curve. brendan: the diversions is so clear. the tracking between the federal funds target rate and the quite rate is clear until we get to zero. vonnie: it is one of janet yellen's favorite indicators. mike: she brought it up yesterday in her press conference. not just about quitting. but it may also refer to the fed. brendan: we have our guest with us. that indicator looks at the quite rate. it sees inflation. luigi: the first thing is we see a better labor market which is the most important thing. second is, yes, it suggests that the fed should start tightening because the labor market is getting better and eventually there will be inflation. brendan: when you say the labor

market is getting better, what for you is the most important indicator? i know you're a finance academic and not a macroeconomists, but which indicator is most important? luigi: i think the quit chart is a very important one. vonnie: the german 10 year yield, what does it say to? luigi: the crisis in europe is not over. i think that is the problem not just for europe but for the world economy overall. i think one of the reasons why yellen is not sure is because she is concerned about a global slowdown that can come from europe. vonnie: the greek two year yield still above 30%. it is time for our top photos. number three amsterdam is

working with a robot company. and an engineer software company to create a printed bridge over a canal. officials have not said where the bridge will be will be will be 24 feet in length. they described the process as drawing in mid a-ir. it's expected to take two months to complete and should be in place by 2017. can you walk on it? brendan: sometimes we look at a photo in a think the world is amazing. that is amazing. mike: i preusume you can walk on it. brendan: the idea of a bridge in amsterdam is it allows you to walk over a canal. vonnie: i'm to go behind you guys. two, this pink creature was just discovered. his founder at the monterey aquarium research institute has

a few ideas for naming him. she's thinking -- opistotuthis? he's jsut soust so cute. he lives 1475 feet below the surface. mike: first rule of tv news, put on pictures of cute dogs. brendan: basically, that is how you save the world. show them pictures of the amazing things in it. it is only a matter of time before that as a mascot in the ucal system. vonnie: it is the eye. utah university is taking us texting policy seriously. it compliant a staircase into three lanes.

the university seems to have made one mistake. there is no lane to come down. mike: can we get that in new york on the sidewalks? brendan: maybe there should be a meander lane. only in manhattan. vonnie: maybe there should be mirrors on the ground. brendan: luigi does everything. he understands that markets need rules. thank you for being with us. our twitter question of the day. we ask how money times will the fed raise rates this year? janet yellen -- sheehan it is going to be a slow progression. we will get one raise or two. that is what we need to know. good morning. ♪

brendan: this is bloomberg "surveillance" vonnie has headlines. vonnie: in hong kong today pro democracy lawmakers have said no to the chinese backed election plan. it sparks three months of

protest against china's efforts to influence politics. thethat means hong kong a lot hold the first ever election of its political leaders and 2017. at&t is vowing to fight a fine over its unlimited data plan. the sec says the wireless company slowed down in her stead -- internet speed once they used a certain amount. it is the largest fin agency has proposed. e tpope francis is urging people of all faiths worldwide to combat climate change. the statement was criticized by conservative saying that the pope should not weigh in on such an issue. the substance of the statement was leaked to the press this week. it is more than a statement. it is an encyclical. brendan: it carries the weight of religious authority. mike: the g-7 leaders agree

nation phaseout fossil fuels. brendan: he is an extraordinarily political creature. i would recommend, i read last night the piece on the body of scientist would buys the pope who has a masters degree in chemistry. he's a scientist. i have been waiting for -- for a decade. you find hope his product will change the world for the better. i have always felt a suspicion when i hear silicon valley talk about social change. kintaro has. in his book "geek heresy." thank you for coming in. you talk about experiments from the early 2000's. the computer in the wall in ga. one laptop per child. i was wrong. we were all wrong. what was wrong with the idea

that technology could improve lives? >> i would say that technology amplifies underlying human forces. exactly in those places where we want technology to have the most impact, human forces are not aligned to take advantage of technology. with these laptops, and the places where the educational system is dysfunctional, technology does not have good capacity. brendan: you went to india in hopes you could change the world. what does silicon valley not understand about the rest of the world? kentaro: they are living in their own bubble where everybody believes that the impacted that the internet has on their own lives transfer to other people who do not have as much education or political power. mike: you did field experiment that worked and thought, this is great. we can provide these computers to other students. then you did not get results. kentaro: we worked in and

violence were we set up conditions to be perfect. we had good teachers. we made sure the technology work. those conditions do not hold in the schools where you want technology to have a positive impact. brendan: institutions matter. that is true in the u.s. as well. kentaro: that is what i found. institutions matter. when i came back to the united states everybody was excited about technology in the classroom, but that only helps in the cases were schools are doing well. schools that are struggling actually struggled during -- brendan: what about kenya that allows people to transfer money over cell phones? kentaro: that is a good example of technology amplifying things in a positive direction. in kenya there was a custom of migrants sending money back home.

mike: you worked for bill gates. he finds a lot of these projects. do he and other people who fund these projects get it? are the beginning to understand you need a foundation before you throw technology in? kentaro: bill gates is an incredibly smart guy who is interested in changing the face of global poverty. initially, he had biases in the same way i did. over time, he came to see that to eradicate polio you need strong institutions in place before you can reach the people who need it. brendan: you went to india. you understood things better you came home. what is the answer for people who would choose, to use technology to change the world? kentaro: if you're already doing something well and doing it -- something good, you can use technology to amplify your impact. the big error comes in there for

the technology is doing the magic. it is a combination of the right person with the technology. mike: i was struck by what you wrote about it's true in america. we have the focus on getting ipads into the hands of kids. what you're showing in the book is when kids get ipads, they p lay games. kentaro: if you look over the shoulder of a kid with a smart phone, they are not playing educational apps. mike: one of your solutions is more focus on teachers, the people who motivate students to want to learn rather than letting technology. ekentaro: there is no way around good, adult guidance for learning. i was in an environment where i went to the same high school bill gates went to. this is a rich high school with all of the technologies. but what the parents want for their kids, they need an extra booze is more adult guidance. they were paying for me to be a tutor. -- an extra boost more adult

guidance. mike: the proper use of the money, to find the way to actually make the impression on the students. kentaro: i think one of the things we mistake is that we think of education is being the content, and the technology delivers that content. but really education is about generating the right motivation and the students. that requires good adult guidance. brendan: i have to admit i am a sucker for your book, because he said what it is i have been waiting for somebody to say. he says, definitely worth the read. we are going to take a quick forex check. the euro is up a bit. planning a european vacation soon, things will change one way or the other. euro-yen cross looking down a bit. the yen down against the dollar.

the dollar down a hair. still waiting on what janet yellen is going to do in. september this is bloomberg "surveillance" streaming on your tablet, your phone, and bloomberg.com. good morning. ♪

at the 200-year-old american ame

church. vonnie: they are about to hold a press conference. police this morning released surveillance video. after the attack on the south carolina church. the suspect is described as a white male in his early 20's. authorities say he walked into a church in downtown charleston and started shooting. it's an historically black church and police are calling a hate crime. >> he is a white male. a younger white male. we are estimating between 21 and 25 years of age. he's 5'9". as you see, he has on a very distinctive sweatshirt that has markings. also the vehicle you will see has a distinctive front license plate. vonnie: the fbi is joining the investigation. all of the victims were black. the greek debt crisis is the

topic at a high level meeting in luxembourg. european finance ministers are trying to reach a deal to unlock bailout funds. alexis tsipras arrived in st. petersburg to meet with vladimir putin. he says he will not give in to demand for more pension cuts or tax hikes. the bailout expires in two weeks at greece may not be able to pay its bills. angela merkel says a deal is possible but only if greece makes good on its promises. merkel: i'm still convinced where there is a will there is a way if the political leaders in greece show this will, an agreement with the three institutions is still possible. vonnie: the three institutions are the imf, the ecb, and the european commission. greece must pay the imf by the end of the month. the fed playing cautious on the u.s. economy. fed officials are saying one interest rate will be enough this year. they are advocating aglow slow -- a go slow policy.

yellen notes wage growth is subdued and says there is weakness in the labor market. fitbit begins trading this morning on the new york stock exchange. pircrices its shares above the market range yesterday. it raised $7432 million at the ipo. jpmorgan vice chairman jimmy lee is being remembered this morning as a rainmaker who put together some of wall street's biggest deals. lee died yesterday morning and is connecticut home. he pioneered the use of leverage loans to fund takeovers. lee advised on such deals as comcast and nbc and gm's ipo. jamie dimon said simply he was an incomparable force of nature. jimmy lee dead at 62. brendan: it is been extraordinary to look at the anecdotes people have been offering up.

i went back and looked at the first time he was mentioned in american banker in 1997. there were some canadian banks trying to put together a hockey game and they said no one tell jimmy lee he is going to bring pros. mike: that is a tom keene moment. there are a lot of former hockey players at work on wall street. vonnie: a lot of headlines. not only are we dealing with the after nafta of the fe -- the aftermath of the fed's statement. all of these headlights coming out of europe. the ecb and ec potentially putting together a debt relief carrot. with all that in the background we have an s&p futures up 1/4 of a percentage point. european stocks were lower, but they are rebounding from the losses. the dax down. the ftse 100 .1%. the dollar index getting kicked while it's down. the dollar index down .6%.

when it comes to yield, we are seeing spreads come in a bit. thwe two year yield .6%. brendan: angela merkel says a deal with greece is possible if greece wants one. hans nichols is in luxembourg where euro area finance ministers are meeting today. hans: finance ministers have arrived in luxembourg. not a lot of positive comments. some expression of concern. the 11th hour is here. a report has just popped. a paper in athens. they are reporting there could be a statement from the european union and the ecb on. long-term debt relief this could unlock things, because what the greeks have been looking for is some sign from the europeans that the nature of the bailout program will change.

they have always said they cannot grow with the debt burden hanging over them. before the line was, and we heard this from madame merkel this morning, with new reforms could come new money. this could be a statement that there is l ight at the end of the tunnel. an attempt to bring greece back to the negotiating table. very little indication they want to do that. they said they will not bring new proposals to luxembourg. brendan: hans nichols. he will head back to berlin to chase the story. here we are looking at the headlines. we have christine lagarde saying "there is no grace period for greece beyond june 30." mike, this has always been the question, what is the real deadline? christine lagarde is trying to impose a real deadline. mike: under imf rules they have 30 days. she's saying that they will consider greece in partial

default if they do not make the payment. all three of the groups have to be together, the eu, the ecb and the imf. the imf does not want to sign on. brendan: christine lagarde saying, who are you, symbolic? -- zimbabwe. janet yellen reminded us that we have exposure to the euro not to tgreece. michael mckee is our dot devinier -- diviner? mike: it is about the dot plot. traders have not seen a rate increase since 2006 or focused on 2015. the median forecast did not change. fed funds trading at 623 basis points which implies two rate moves. some including economist at citigroup say that if you couple that with comments that inflation is going to rise. man, you do not want to be behind the curve.

you have to figure there is going to be two moves by the end of the year. fewer people made higher forecast. goldman this morning as saying that means they may delay. they may wait until december. that is what the market seems to be trading this morning. yellen says that is not the whole point. what she wants is for traders to focus on the path of rates going forward. brendan: our guest is chief international economist at deutsche bank. are you a diviner of dots? >> we spent a lot of time on the dots. whenever she has put out the dots, i get phone calls from clients. where is she? the whole point is they lowered the meidandian dot for next year. the path is more gradual which

was the buzzword yesterday. brendan: we read a piece yesterday. he's trying to figure out which dot is where. on the left, that has got to be -- there's nothing like the zeeal ofal of a convert. >> at the end of the day, it is a committee decision. the committee is signaling that it is going to be slow. and the way -- they will be moving twice this year. vonnie: that is what you believe? we have different opinions on that. torsten: we think this september is the first move. this is data dependent. what's ironic about that is shouldn't it be forecast dependent? it is stepping away from the forecast. we may not believe it that much. we would rather say that data

comes in. it's much more important. that is telling you that there is a risk of being behind the curve. brendan: you had a piece that said beware of inflation. torsten: the main point is that the risk of being behind the curve are twofold. first of all, the risk is we could see more inflation in the pipeline. that is the traditional textbook risk if you move too slowly inflation will come quickly. the other risk is instability. the hunt for yields and many are worried about financial instability than inflation. brendan: going to be with us for the rest of the hour. we take a look at our twitter question of the day. how may times will the fed raise the rates this year? let us know. good morning. ♪

brendan: this is bloomberg "surveillance" mike: miore headlines coming out of greece. both related to according to the russian energy minister. greece and the russians may sign an agreement to build a pipeline through turkey

you have to wonder what european politicians are making up all this. we are seeing more headlines about a greece compromise. you made the point, that is further out in the future. "market makers>> everybody has been critical of alexis tsipras. there are few people defending the greeks. a well-known economist at the university college in dublin says greece has accomplished something. they have reduced their fiscal deficit by 15.6% of gdp in 2009 to 2.5% in 2014. that is a debt scale reduction not seen anywhere else in the world. the greek government has taken many top decisions and they have had to and were a lot of harsh economic penalty because of it. brendan: they us this

year coming from that deficit which is extraordinary given what they were going through. and yet, they have some well -- somehow squandered the goodwill they had with the way they negotiate. vonnie: they keep making the argument that they have a mandate. the greek people are tired. a lot of them do pay their taxes. it's difficult. brendan: should we be more sympathetic to the greeks? >> greece has come from a very low spot to a much better ranking today. we have a situation where someone has improved quite dramatically -- this is structural policy.

they are not where many europeans would like to -- like them to be p. brendan: coming up, william harrison joins us. he will help us understand what jimmy lee did for wall street for 20 years. this is "bloomberg surveillance." ♪

brendan: tom keene is out. we have some headlines. vonnie: we certainly do. brian williams will keep working on nbc. he was suspended four months ago for exaggerating his role in an incident during the iraq war. the new york times says he will be replaced by lester holt. he has been filling in since

williams was suspended. williams will move to msnbc. air b&b in talks to raise money $24 billion. one of the world's most valuable private companies. air b&b is projecting revenue this year of $900 million. that's almost four times what it was two years ago. the u.s. open tees off in a few hours. the world's best golfers will challenge the course in washington state. one of the favorites is rory mcilroy. he missed the cup in his last tournament. an undulating golf course. brendan: he grew up playing on those kinds of golf courses. it sounds fascinating.

danielle started her career on wall street and then went back to her home, the lone star state. advising president richard fisher. she is gone from the fed now, now writing -- mr. fisher was not a mainstream thinker on the fed. neither is danielle. in your first writings, you take extremely strong issue with the idea that qe was a success. you find a lot of problems that it's setting us up for down the road. danielle: you can characterize it as a success with the financial markets. we called it quantitative pleasing bu because it pleased the financial markets so much. we will have further consequences this time around as

well. i don't think we will have different outcomes. we have a bubble building -- mike: we have a bubble building in the markets? danielle: stocks are the most overvalued they have been since 1999. that doesn't help me sleep at night. vonnie: based on what metric? danielle: schiller's tenure paper valuation metric. or the stock market valuation overall compared to gp. -- gdp. the valuation measure is more overextended than it has been at any other point since the 1990's. brendan: you have to stand outside the door and wait for them to throw you table scraps. mike: spent a lot of time outside the door. brendan: now that you were out, what can you tell us? how are these decisions made? danielle: i never sat around the

table itself. what i can tell you is from the perspective of somebody who looked at the world through the prism of the financial markets come i don't think they are given enough credence in the decision-making progress. fisher was one to always bring the subject of financial stability to the table. his background differs from many of the decision-makers. brendan: of all the criticisms i've heard about the fed system the one that makes the most sense to me is that there are too many economists as fed president as opposed to other types of people. danielle: 30 to be more people who understand the financial markets. who have worked inside the fixed income markets. especially the currency markets. that's not to say that the fed should be more politicized. that is a slippery slope. criticism has emanated from that.

brendan: jump in here, please. torsten: there is a tendency to have the group thinking of the macroeconomic textbook. it's clear that the whole leadership of the fed has been driven by the psd textbook issue. it's my impression that they spend a lot of time on this, but it's difficult to quantify those risks. that is the main problem from a macroeconomic perspective. how do you quantify the risk of low liquidity in the bond markets? how does that feed into my decision? it becomes quite difficult. the approach at the moment seems to be if we can't, quantify the risk, we should ignore it. danielle: that is a dangerous pathway to take. mike: he always complained about

how financial oppression was hurting the nations -- you are calling it criminalizing cash savings. danielle: it has become criminal to be a conservative retiree in this country. the report won a fight it as being for $70 billion in foregone interest income -- $470 billion. usually be able to back in off the risk curve at a certain age and it has been criminalized by leaving it just rates as low as they have been. vonnie: do you think that your graphic argument has something to do with it? fisher was one of the ones who came from the streets. the texas economy was doing so much better than the rest of the united states. danielle: texas has been a tory us as being -- notorious as being a friendly state in which to do business. it has become a much more diversified state. brendan: i was born there.

danielle will be with us for the whole hour. stay with us. how many times will be raise rates this year? ♪

♪ ♪ ♪ get excited for the 1989 world tour with exclusive behind the scenes footage all of taylor swift's music videos interviews, and more. xfinity is the destination for all things taylor swift. brendan: this is "bloomberg surveillance." we have with us, daniel dimartino, formerly of the dallas fed. in honor of her, we took a look at inflation, the way the dallas fed looks at it. the difference between trend

core inflation and core inflation if you take out the outliers on the top and bottom. the same way they score international ice-skating. you end up with a different measure. just how much divergence there has been the way the dallas fed measures inflation, we have a much higher risk of it. mike: there's no east german judge is there. you get some real volatility on either end, that doesn't last. you take it out and you look at the middle of where inflation is. in dallas, you are finding more inflation. danielle: in dallas, we have found more inflation in the area where i think inflation is truly run amok. we will see that when the data come out shortly. that has been in rental inflation. americans rent up 5% year-over-year.

if you look at the tpi, it's been 3.5%. it's one of the least appreciated areas of inflation. it's very debilitating for the average household. brendan: every fed has its own indicator. top headlines. vonnie: police released surveillance video showing a man suspected of killing nine people in that attack on a south carolina church. it's a white man in his early 20's he walked into a church in downtown charleston and started shooting. six women and three men were killed. it's a historically black church and police are calling this a hate crime. >> a white male, younger white male. between 21 and 25 years of age. approximately 5'9" in height. he has on a distinctive sweatshirt that has markings.

the vehicle you will see has a very distinctive front license plate. vonnie: the fbi is joining the investigation. all the victims are black. among them, the pastor. european finance ministers once again trying to solve the greek debt crisis. if they are in luxembourg discussing a possible bailout. greece may not be able to pay its bills if rescue funds are not released. there's speculation greece might seek help from russia. alexis tsipras is meeting in st. petersburg with vladimir putin. a vote is expected in the house that could salvage president obama's trade plans. the proposal was defeated last week with members of the president's own party leading the opposition. democrats say the asian trade deal would hurt american workers but republican leaders are we reworking the proposal.

a judge ruled on the request from the silicon valley venture capital firm she sued. kleiner perkins -- the jury ruled against pao in march. he talked about it with emily chang. >> i'm sorry this happened to ellen, that it happened to us. this is not a question of guilt. it's a civil case. the question is why. the jury found we were not liable. vonnie: to see the entire interview join us tonight at 7:30 eastern for studio 1.0. sorry, alexander hamilton. you are being partially replaced. at the $10 bill will be a woman's image. the new bill will be unveiled in

2020. he may still appear on some of the tens. brendan: the father of american finance, sure. alexis tsipras just put out an op-ed in a german newspaper convincing them that german taxpayers are not paying for greece. he opens with a quote from arthur schopenhauer. mike: in the markets this morning, it's not about greece it's about the fed. stock market futures this morning are higher on the idea that the fed will be lower far longer. the same thing happening with u.s. treasury's. interestingly enough despite all the grease stuff, the euro is stronger today.

-- greece stuff, the euro is stronger today. european bond yields are lower this morning. brendan: this is "bloomberg surveillance." here are two words we have been hearing in the last week. capital controls. this is not a thing that point countries do, but we are not in polite times. it may be something greece has to do. this is something the imf was traditionally against. they changed their tune in 2012. we have seen capital controls. what have we learned about how to do this? torsten: generally, it's really an emergency measure. you don't want to do that because it's like saying economics and markets are not functioning. we have to do something to stop

whatever it is that's going on. this year this is still not preferred anywhere in the world unless we get to it extreme situation. we have come to crunch time, if this is what we are talking about as soon as next week it's something that will be viewed as a serious initiative. mike: it's something you don't talk about ahead of imposing them. it creates capital flight. brendan: the first rule about capital controls is you don't talk about capital controls. torsten: the more you talk about it the more you tell people this is coming, the more they panic. vonnie: isn't the money all gone? torsten: that's not the case. we have seen a significant change on the greek side. not only on the greek side, but also the european side. mike: the role of the ecb in all of this -- yesterday, they

approved more loans for greek banks to keep them afloat for a while. how political is the fed -- how political are central banks? do they want to get involved in this sort of thing? william: i think central bankers and general have become frightened of disrupting the financial markets in any way. they will take whatever measures have to be taken to not be disruptive. that backs central bankers into an increasingly tight corner. brendan: they have to be political. they have no choice right now. mario draghi cannot pretend he is not a politician. danielle: i thought it was funny that he would come out and say i'm not political. of course he is political. more political than the politicians. vonnie: very much in deflationary territory. brendan: we begin to talk about capital controls. the paper says it's easy to get

into them very hard to get out of them. it takes much longer than you think. iceland is now just creeping out of them. because it's a thing that polite countries don't normally do. you have to convince people in the country that it's a good idea or else they will try to get around it. torsten: the issue is, it's really also confidence. it takes time to rebuild confidence and that process can be protracted. mike: it's a way to keep them in the eurozone and in the eu, even if they are not paying their bills. danielle:vonnie: $30 billion -- put that into context for us. is that a large amount of money? torsten: in greece, there is a debate. and very significant statement

around this debate. it's also clear, it tells you that greece needs to decide what they want to do. it's complicated. brendan: we are down to reading to see what alexis tsipras is saying. we are almost out of information right now. mike: the extent and pretend seems to be over. neither side his coming together to make a pseudo-deal for any more months. brendan: it depends on how you define extend and pretend. we have an offer from the eu to extend and pretend on the debt. this is what they did for ireland. you will deal with it in 2040. thank you to danielle dimartino. jumping into different inflation

numbers. our twitter question of the day how many times will we see the rates rise this year? ♪

brendan: this is "bloomberg surveillance." mike: it's rare to find someone

all wall street so universally admired and loved as jimmy lee was. dying suddenly yesterday at the age of 62. bill harrison hired lee and set him on his course when he ran the bank in 1975. he joins us now on the phone. you set him on his course by asking him to start a syndicated loan business. for wall street and american industry, the rest is history. william: it was a really interesting story because i was running u.s. corporate division at the time and jimmy was working in the asia division. he came to me and said i want to do something different. i completed a study about the loan syndication business and said jimmy i forgot something that could be really great for you. he took over the loan syndication business and within

two were three years, we were a player. within three or four years, five years, we were the leader. this was a really critical part of the foundation of what jpmorgan is today. the loan syndication product, he did it well it enables you to go to the large corporations and underwrite huge amounts of debt and they would give you an opportunity to provide them other investment banking products which we were trying to integrate into our vision and strategy. vonnie: he called you a father figure at one point. give us an idea of one of the big deals you would have done together. william: i put two bookends around the deals that jimmy did in his career. one of the first big once was the bankruptcy of texaco. that was a $10 million loan --

$10 billion loan. he came to me and said we want to get into that business. nobody had ever commercialized debtor possession -- $10 million was a lot of money in those days. we became a leader in debtor possession financing. jimmy just was an integral part of ge possis been out of their -- ge's spin out of their capital business. he helped ge orchestrate that. that was a huge deal. brendan: what made him what he was? william: he was a pioneer, he changed with the times, he could outwork any one, had a great vision of where the business was going and was as good as anyone

i have ever known and using his wisdom to convince you he could solve your problem and he did it with a great attitude and a great client focus. he was a dealmaker, he was competitive, he had a rolodex that was unbelievable and he got the job done. brendan: william harrison remembering jimmy lee. ♪

brendan: this is "bloomberg surveillance." you have top headlines. vonnie: hong kong promo dr. c lawmakers a note to the plan backed by china -- pro-democracy lawmakers say no to the plan backed by china. hong kong will not hold the first ever election of its political leader in 2017. at&t is -- the wireless company slow down internet speeds for unlimited data customers. it's the largest fine ever imposed by the agency. shares of oracle are lower in the premarket because of

quarterly sales and profits that missed estimates. oracle says it was hurt by currency fluctuations and by customers moving to cloud-based computing. brendan: keep monetary policy loose enough long enough and suddenly, denmark central bank is the place. torsten: challenged me to spell that right without checking -- let's talk about the other periphery the northern periphery dealing with its own capital flight into sweden, denmark. how do you handle that? torsten: when your neighbors to the south have had these problems, money has been trying to go elsewhere. one huge beneficiary has been the nordic countries.

those smaller economies have been benefiting by stock prices going up. it's become somewhat of a curse. if too much money comes in, it becomes a challenge for central banks. brendan: having trouble holding onto that -- they insist they can do it. torsten: that's the big difference between norway and sweden and denmark. denmark has the exchange rate -- if you have such an inflow come a lot of upward pressure on your exchange rate. vonnie: record lows may ease policy further. torsten: absolutely. that's why we've had issues with the while prices. they have their own interest rate, so they can do whatever is needed. denmark is not been able to do that. brendan: economists say denmark never do experiment. you have the benchmark rate which is negative.

that has all kinds of knock on effects. torsten: it was one of the first countries. this has been studied carefully by central banks all over the world. what were the implications on the housing markets? if interest rates are negative for too long, you have a huge boom in housing. brendan: is the zero bound permeable? torsten: the risks are certainly there. home prices on the upward pressure for an extensive period . it's all working quite well. if this persists for a long time, you will have some challenges with the housing market. mike: can they sustain and denmark? we saw in the 1990's, the asian currencies that were pegged had to give way. torsten: the issue here is, how long will there be problems in the rest of europe?

how long will the issues persist? it would be a temporary period when measures are in place but it will normalize. the longer it persists, the higher the risks. brendan: this was could not hold it. torsten: they had it for three years. there's some differences in how committed politicians are. in the swiss case this came completely out of the blue. brendan: there is a cultural problem here of credibility. the small countries have trouble convincing people that we have responsible economies, responsible central bankers. it's always assumed that they are going to fail. torsten: absolutely. these countries are so small, a significant amount of money is looking for some place

to go when it finds those shores, it complicates things. it's not big enough to his or the amount of money coming in. brendan: the happiest country in the world. what is the bigger story in europe right now? is it mario draghi or alexis tsipras? torsten: we need some resolution on this from greece. the issue continues to be -- my job sitting in new york city is when i travel in europe, i see clients over there, this is the thing we talk about all the time. u.s. clients talk much less about europe than we used to. we talk about this so long don't we get another kick the can down the road situation? there is a split where the focus is. vonnie: don't norwegian krone is 1.5% weaker. where is the safe payment -- safe haven right now? torsten: if you are worried

about these things going on with europe, where should i go. emerging markets are generally not doing very well. the discussion is what is the pace of rate hikes? if it is a slow and gradual staying in the u.s. may not be a bad idea. mike: the fed is still more powerful than greece at this point. we see that this morning with the euro. torsten: the power of the fed and the power of controlling expectations, it will be gradual and we will slowly move up. it should not worry too much about the issues. in terms of volatility. brendan: the controlled

experiment of denmark. the possibility of a liquidity in sovereign debt. vonnie: i put a question of the day, how many times will the fed raise rates this year? "just one." brendan: is that from jyellen? vonnie: "they will not hike this year. our third answer "you will have to swim to the statue of liberty." brendan: we were missing a bit of tom keene. don't you have something to do this morning? vonnie: he is on ellis island.

or on his way to ellis island. brendan: looking into his lost history. what is your agenda this morning? vonnie: besides tom keene pti. the most important data we can see what to take a look at inflation. we are looking for an increase of .5% on the headline number. mike: i will look at greece. they are meeting in luxembourg. it would be more appropriate if they met in belgium today. this could be waterloo. brendan: are you making a metaphor? mike: i know it's a little early for that here. brendan: if we in the u.s. are growing tired of following every twist and turn in europe, what is the next which look for? torsten: the fed liftoff is the most important thing. if u.s. fixed income normalization will be more violent we will have much more

turbulence in the financial markets. liftoff, the timing and the pace of rate hikes is important. brendan: my agenda today is charleston, south carolina. the pictures there and the news there of nine people dead, shot in a church. almost too awful to think about it. the police chief has already said this is a hate crime. this will be the defining story of the day. vonnie: the press conference at around 7:00 this morning. the mayor sing it's unfathomable and unspeakable -- saying it's unfathomable and unspeakable. brendan: the stud looked you saw this stunned look -- the stunned look you saw on the faces of the mayor and police chief. torsten: thank you for taking a

tour with us of janet yellen s possible fed. -- janet yellen's fed. ♪

ers." stephanie: good morning everybody. this is >>." -- this is "market makers."

janet yellen's signs. we will hear from jack welch. the former ge out vonnie: ceo joins us later. matt: time for the top stories. olivia: police have released pictures of a white man there's a shot and killed nine people at a historically black church last night. he's described as being between 21 and 25 years old. the police chief kills the killings a hate crime has asked for the public's help in washington. >> we are bringing in resources from washington to help us. we set up a hotline. we have agents and police officers manning that phone.