alix: we are moments away from the closing bell. this is the bloomberg market day. i am alix steel. [bell ringing] alix: you are looking at a mixed market on this friday. the dow jones industrial average closing up 64 points, the s&p relatively flat, the nasdaq the loser, off .5%. you can thank nike, 4% of the dow jones industrial average. we got the future orders up 13%.

boom, dow, outperform. joe: you saw the flipside, the big loser was tech. alix: also the russell 2000. this could happen -- joe: it's fun. alix: it is fun. joe: i was not being facetious. alix: in theory, this could be the busiest trading day of the year because of the russell rebalancing. to change their holdings. pretty exciting day. joe: speaking of which, historic supreme court decisions, terrorist attack today, and greece still with us.

alix: there are protests of the far left party right now in athens and that is ahead of the meeting with eurozone leaders. again, down to the wire. of course it's going to come with concessions from greece, and greece rejected that. you could see the stocks in the s&p take a dive around 1:30 when greek officials that, look, this will lead to more austerity, no dice, people. joe: the quote of the day absolutely belong to the german finance minister who said, the greek government is democratically elected, but so is mine. suppresses saying, you cannot make us do this. that's a fine point. but greece is also asking its creditors for more money. he is saying, i am here because i am elected as well. what is the greek vote went over the german vote? alix: hundreds of billions of euros in some form or another

are owed to other european countries. there was a great article and bloomberg news this is all of this really comes down to the price of milk, cheese, and pasta and at the end of the day, how much are you going to tax everyday goods greeks are going to buy?, can that save the government? if you just imported, it hurts the farmer down the road. it's a fascinating look. joe: it seems crazy when you think about it. they are in this room and they are fighting and it becomes all of these little things are and how much are you going to raise the tax on milk and pasta? if that is the debate, ultimately you cannot break up a currency union over the price of milk. that being said, more ridiculous things have happened. alix: that is entirely true. the irony is greek mega tv says most greeks want to stay in the euro even though there are these protest.

they want to stay. joe: it is remarkable. people do not want to leave. alix: we have our guest to help break it down, the wells fargo senior equity strategist, scott, and also lisa abramowicz. happy friday. thanks for being here. scott, do you care about greece? are you on the edge of your seat? scott: absolutely not. but i have seen this on a lot of fridays. a lot of fridays over the past few months, traders have not wanted to go home too long and that is why you have seen these selloffs on friday. i think what is going to happen, the highest probability as we see a band-aid, the candidates kicked down the road, but probably only for three or six months. we will get through it, i think,

this time, but it will be another replay, a mess, and we will continue to see volatility in the market. but it is becoming less and less of an issue on a daily basis. alix: i should point out you may not want to own something headed into the weekend, but you do not want to bet something good is going to happen and miss out. lisa: in credit markets there is a great report by a barclays analyst today and they were talking about how credit trading had fallen to the lowest level of the year in the past week because there has been such a uncertainty in greece, in china about the fed. it's just getting too much and people do not want the risk. the dealer positions are coming down. the assets they have on their books are coming down. people are trying to clear off what they've got. joe: i want to talk about something happening in the u.s. good news. consumer sentiment rising to the highest level in five months.

scott, we have gotten a lot of good data lately. strong consumer consumption numbers, strong consumer sentiment. do you think that this is a risk that the fed hike to come with some acceleration? scott: i think consumer confidence has risen, business confidence has risen. we expected it to. that is pretty much a coincident indicator. i think though that the fed would really not have to do anything this year if they did not want to. saying that, i think there will be a token hike in september. the probability of that is a little less after the fomc meeting, because i think the fed will give us good hints in advance. we will skip plenty of fed meetings between rate hikes, so the fed is not going to be aggressive. what you want to wonder about is

the magnitude and the pace, not necessarily the timing. but they don't need to be in a hurry. lisa: i do think that this week was significant from the treasury respective. we have seen the steady grind upward of yield. today the 30 year yield going the highest of the year, the highest since november. there is an increased expectation of inflation, even looking out over the last 10 years. you did see it rising to the highs of the year. there is a reassessment of inflation. alix: i keep hearing pimco coming out and saying, we are worried about rising inflation, to your point. lisa: so even if people do not expect that much by way of the fed, they are reassessing inflation. joe: speaking of the fed, bank of america came out with a note saying what asset classes are

vulnerable to a rate hike. scott, what areas do you think you should avoid in terms of preparing for a fed rate hike? scott: i think what you want to do, and i will speak from the equity standpoint, you want to have a plan. if the market gets volatile and we see fullback, that is an opportunity to buy stock. that has been the case in the last two cycles. for the next multiyear period, stocks traded higher. the fed has some confidence. they are not always right. but i think things are getting better. i think the cyclical market has more room to run. as we have done the last 40 years with our clients, when we see market pullbacks, we want them stepping in to buy stocks. retail investors are underinvested.

they need to take advantage of downside volatility. lisa: i think the big concern is becoming credit risk. that these companies that maybe should not have existed, should not be able to finance themselves have borrowed this money at such cheap levels. this is really the issue, especially if the fed hikes and it slows the economy down. what will that do to these companies relying on a pretty steady acceleration of u.s. growth? joe: all right, one of the most amazing market moves of the week has to have been what we saw in china. the chinese stock market has had an incredible run this year and the last two days absolutely getting clobbered, including last night. 7% down. scott, are your clients interested in china and what do you make of this seesaw market? scott: retail investors are

underinvested internationally and that is probably what you mentioned happened with the chinese market. for me, emerging markets, they are going to be volatile. that is what is going to happen. those markets are developing markets. they do not have much liquidity. you need to have a long-term view, and i am not talking 2, 3, 4 years. you need to be looking out five, 10 plus. you need to close your eyes and let it ride. you might adjust it a little bit on the way. emerging markets will be very volatile. if that scares you, you probably should not be there. lisa: scott, that is a fair point. in the volatility we have seen,

morgan stanley is saying it is not a buying opportunity, buying does not apply here, but that said, there is a great story out on bloomberg today saying there are $21 trillion on deposit in chinese banks and these are people who have all of this money because of the incredible acceleration of the economy and now the country is invested elsewhere. this could spur growth globally and in china. maybe it is not so crazy. alix: good stuff, guys. really appreciate it. lisa, thanks for joining us, also wells fargo's scott wren. now a quick programming note. some exciting news. joe: we are starting something new next week. it is a new look at the markets. it is called "what'd you miss." alix: there will be charts. there will be a lot of fun. coming up, we will be talking about the latest headlines from france.

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alix: welcome back to the bloomberg market day. i am alix steel. now to some of our top stories of this hour. the supreme court makes history and caps the biggest civil rights transformation in history. the justices rule 5-4, with anthony kennedy writing the majority opinion. more than 80 people are dead after terror attacks in four countries. u.s. officials are investigating, but there is no evidence the attacks were

coordinated. in tunisia, terrorists opened fire at a resort. in france, terrorist targeted a factory. they decapitated a man. four suspects are in custody. in syria, terrorists attacked a base. those are your top stories. betty liu and pimm fox asked homeland security secretary michael chertoff if he thinks today's attacks might've been coordinated? michael chertoff: part of what isis has done is it has counseled or advise people who believe in its ideology to go carry out attacks. it is not a coincidence. it reflects a commonality of ideology. pimm: michael chertoff, talk

about france. it has been the center of many terror related attacks. michael chertoff: france has a combination of immigrants from parts of africa and a small part, a significant part, is either radicalized or sympathetic to radicalization and we have seen some of these people carry out these attacks from the "charlie hebdo" case and according to news reports, they were monitoring one of the perpetrators several years ago. as a result, there is a concern that many western countries have that isis would use people who are citizens of those countries as being part of the attack vector against innocent civilians. betty: michael, taking the example in tunisia, for example

-- how quickly could we see that happen on u.s. soil? michael chertoff: obviously we have seen a number of attempted attacks in the u.s. we have seen other attacks disrupted. the notion of attacking a hotel where there are tourists is something we saw in mumbai in 2008. i think we will see similar soft targets increasingly being targeted by the current generation of terrorists. that does not mean they will not try to have another big attack like 9/11, but as we degraded them over time, i think they find it easier to bring multiple attacks against multiple, easier targets. pimm: attacks on united nations peacekeeping troops in somalia. michael chertoff: that's true. historically we have seen

terrorists attack igo's or -- ngo's or charitable organizations because they view them as potentially winning allegiance of the local populace and what the terrorists want to do is have the monopoly of power in the areas they control. they will use force to intimidate. they want to have the ability to control and reward those who are part of their group. betty: michael, before we go, what should be happening now knowing that within the last 24 hours, really, we have seen attacks in four different countries. what needs to be happening among the intelligence organizations and all those countries and in the u.s. and in europe? michael chertoff: the intelligence agencies need to make sure they are sharing in real-time current information about people who are potential threats out there. the word is going to go out, and it has gone out here in the u.s.

to people, whether it is hotel owners or other infrastructure or other public facilities, they need to raise security on a moments notice. a lot of that is not just prevention. it is response. if someone does wind up in a shopping mall or motel, you have to have the ability with local law enforcement to very quickly shut that down. otherwise you can have a horrible tragedy like you had in mumbai almost 10 years ago where the terrorists had 60 hours of mayhem before they were finally killed or apprehended. alix: great insight from michael chertoff, chairman and cofounder of the chertoff group. another historic day for the supreme court. gay marriage legal nationwide. we will discuss the social and legal implications next. ♪

alix: we do have breaking news for you. julie? julie: we are following the situation with the two convicts who have been on the run, the escape convicts. apparently gunfire reported in the search for the new york escapees. it is unclear exactly where that gunfire is because that is the only headline we have from the new york times at this point, but it seems perhaps the authorities are closing in on the escaped convicts. there are some reports about the shots fired. the authorities closing in. that seems to be all of the information at this point. alix: thank you for the update

on the escaped convicts. the supreme court legalized gay marriage and pimm fox and betty liu asks how republican presidential candidates will respond to this historic ruling. >> some of them are trying to underplay their opposition, because they know in the general election 60% support same-sex marriage. but they're also trying to court these social conservative voters, so it's a wide range. betty: what did you make of chief justice roberts siding with the minority in this opinion? >> it was fascinating coming after yesterday's ruling in the obamacare case. the chief justice said basically i think there are great reasons why same-sex couples should celebrate this ruling and want to get married, but the constitution does not grant them that right and this is not a decision that should've been taken from the people. pimm: what does this tell you about future rulings from the

court? >> it tells you this is a closely divided court and justice anthony kennedy is often going to be the swing justice. we will have other issues involving gay rights that will come up through the courts. we will have issues about whether people with religious objections have to take part in some way or another in same-sex marriage ceremonies. this issue is not over, but the big issue, the supreme court has said resoundingly by a single vote that same-sex couples do have a constitutional right to get married. betty: you wrote this piece about what the pros and cons are for gay couples to be married. what are the big pros and cons. >> may be some of them have been together for decades and now they have to decide, are we going to do this? there are benefits. there are obligations come with it. overall what people need to know -- marriage really matters at

the end of your life or when something awful happens. when someone dies, there are health care decisions to be made. those are the big benefits. betty: let's break it down. a pro is that you get retirement benefits. >> you get your 401(k)'s, ira -- betty: but there is a pro and a con when it comes to taxes? guest: some will pay more. some will pay less. if you make six digits and you get married you could really see your tax bracket jump quite a bit. betty: we had several republican presidential candidates come out with statements right after this ruling. i will read for you one from jeb bush. he said "guided by my faith, i believe in traditional marriage. i believe the supreme court should have allowed the states to make this decision. i also believe we should love

our neighbor and respect others, including those making lifetime commitment." when he says this should be left to the state, which is been the argument of the republicans, how are these states going to take a ruling like this and apply it locally? guest: there will probably be some resistance. there may be county clerks to say, no, i'm not going to do it. we have seen before this ruling alabama, the alabama supreme court telling his probate judges do not obey the federal court ruling. but there is a majority approving and that has only been increasing and probably will only continue to increase after this ruling.

alix: thank you for watching the bloomberg market day. have a wonderful day. we will see you back here on monday. ♪

♪ >> from our studios in new york city, this is "charlie rose." charlie: it is a historic week for the united states supreme court. the court affirmed in a six to three hearing today that nationwide subsidies called for in the affordable care act are illegal. chief justice john roberts wrote in the majority opinion -- congress passed before the health care act to improve insurance markets, not destroy them." by ruth bader ginsburg, stephen breyer, sonia sotomayor, and elena kagan. boating with the majory,