malaysia's currency is the weakest level since 1998. results stock market has entered a bear market. matt: do you want to by an airport?- buy an the privatization plan that changed -- having an affair got even messier if you are one of the individuals who use the ashley madison website. matt: good morning. pimm: we are 90 minutes into the trading day in new york. let's take a look at where markets are trading right now. a bit of a sellout today. dow jones and the s&p 500 both

shedding more than 1%. taking their cues from the stock activity in europe and asia. matt: this story you sent me at 5:00 a.m. showing european markets down 1% across the board. all of this cost by currency concerns. -- caused by currency concerns. movement -- pimm: you don't see the continuous decline in the value of the yuan, but it is losing value. the taiwan currency losing value. matt: the dong has been devalued for the third time here. the trading ban has been widened to 3%. you don't see what happened yesterday, but this is really the story that is striving the market. -- driving the market. pimm: you have a manufacturing plant in vietnam, you are doing

business in vietnamese currency, that gets translated back into u.s. dollars and you are getting a lot less or it. matt: is this a currency war? tom keene declared a currency war. it's interesting. .imm: i'm going with mr. k let's look at the top stories at this hour. the u.s. inflation report rose less than estimated and remains below the target of 2%. the consumer price index rose in july at the slowest pace in three months. .3%.ne, prices increased gasoline and food prices increased marginally but the posted shelter solid gains. household furnishing costs fell. , the federal reserve will release minutes from last month policy makers meeting. the notes may show whether there that consensus

september is the right time for a rate increase. earlier, we spoke with the chief economist at j.p. morgan securities. >> the reason why the fed is thinking about tightening is potential growth is leading to rapid tightening in the labor market. you get lower equilibrium rates -- you have to get there quicker. more than three quarters of the economists surveyed by bloomberg say the federal reserve will raise interest rates at next month's meeting. shares of target higher today. the discount retailer posted second-quarter earnings that beat at us -- beat analyst estimates. has cutchief executive costs and is focusing on the company's best categories. longtime pitchman for the subway sandwich chain will be

going to prison for sex crimes. jared fogle pleads guilty to having sex with minors and receiving child pornography. they're asking for the prison sentence of more than 12.5 years. he is paying restitution to his victims. subway says it has ended its relationship with vogel -- jared fogle. england remember in time the country stood alone against nazi germany. a battle in the skies over southern england 75 years ago this week forced hitler to abandon his plans to invade the country. coming up in the next hour , we will be taking a look at cheaters. beware. the hackers. data -- the hackers who stole are from ashley madison

naming names in the open. the first prescription drug designed to boost women's sex drive is heading to the market. what is being called the viagra for women. out the federal reserve stress tests are pretty stressful for bank of america. good the challenge for the bank, the cost to chief executive brian moynihan's job? selloff.lobal stock emerging-market shares extending their declines to a four-year low. he was falling for the second straight day. pimm: gold and silver expecting to move higher. prices for gold and silver are falling. us, the head of institutional equity trading at raymond james and joe doe.

what is the deal on metals right now? looking at aluminum and copper. >> industrial metals>> not having a good time right now. july was especially battered aluminum and copper has been touching fresh six-year lows seems like every other day. copper, which is a big one in housing here and in china, a lot this as toooking at whether it is a gauge of weakness in the world economy. do american businesses that are not in the metals business rebound benefits -- reap any benefits? your electric just got a lot cheaper. >> there is a cost benefit to that side of the analysis. when you look at it from a bigger picture standpoint, why are the commodities coming in?

lack of growth, deflationary pressure. companies are unable to pass along higher prices. while their margins get better because of lower commodity prices are in put prices, they are not -- it's a benefit but a mixed bag. matt: they are all in emerging markets. it isn't because we need less copper wiring. it is because of china. is correct.hat china's 45% of the world's consumption of copper. united states, things seem ok in the unites states. such a china is huge consumer, that is what is driving an overall. pimm: in the context of the evaluation in china, tell me about automobile manufacturers and material makers. the would rather talk about energy sector. that is more relevant and also commodity driven. using talks about what prices

oil companies have been able to pass along. that is benefiting the consumer. pimm: what about the investor? should you be buying -- >> people are getting their co-into the sector generally speaking. buying seeing targeted and specific company buying. it is simply a matter of april got pretty good at managing their costs -- they have gotten pretty good at managing their costs. retail investors are starting to feel like the commodity has bottomed out. you are getting a return on your investment in terms of dividends. there is more upside than downside. we've seen a couple brokers upgrading the sector. i wonder how long the underlying commodities are staying at these levels. we saw a loss in the norwegian

bank that controlled its overflow. if oil stays below $60 a barrel, it will be a problem. they are looking at brent, $10 below that. metals all hitting lows. seem to be staying there for a while. >> dipping their co-into the water to see about the energy sector. toe into theeir water. a lot of them are saying it is tough to say it we've hit bottom. when commodities go lower, they don't always bounce back. pimm: what are people selling? >> you are seeing the momentum trade -- the tech sector is weaker. health care is one of the better performers in the s&p and doubt this year. a lot of m&a talk. -- s&p and doubt this year.

-- dow this year. matt: m&a will be the theme across industries. >> m&a and stock buybacks. companies are not looking to grow internally. they are looking for merger partners. pimm: for your attention to precious metals. silver at $15. silver may be a proxy for industrial demand? >> sometimes yes. it closely tracks gold. it does have many industrial properties. it depends on which trader you are talking to. a lot of people lose money in the gold and silver trade? >> both smiling. >> gold has a cultlike following. you have gold bugs out there who think you should be 100% invested in gold. pimm: they sent me like five

e-mails a day that the world is going to hell in a handbasket. pimm: but a gold handbasket. matt: we've seen a substantial gain in gold. it's very interesting. pimm: thank you guys very much. matt: 15 years ago, we were looking at 300 announce. pimm: some will say 3000. thank you very much. matt: still ahead, as germany backs greases third veil of program, greece begins the process of privatizing its state assets. the latest on all the greek drama, coming up. ♪

matt: welcome back to the bloomberg market day. pimm: let's go right to a look at what's going on in the markets right now. we have a selloff today. >> across the board, we do have a selloff. taking a look at a couple other uppers and downers, start out with james smucker. being affected because of analyst ratings. earlier this morning, it's all its biggest jump since february 4. right now, up by about 2%. sis is due to credit uisse upgrading its forecast. $25r price target is one of for jm smucker -- $125 for jm smucker. aflac cut to underperform from

neutral. down about 2.5%. they are not expecting earnings to improve over the next two years. the new price ta target is down by two dollars. yum! brands up by about 2.4%. seeing some recovery from that selloff we were talking about since august 10. the company has chosen a new ceo of its china division, head of the company's kfc division. come sales in china have turned significantly positive. same-store sales fell 10%. thank you very much for that. lowe's.owth slowing at second quarter profit that missed estimates.

revenue grew at the slowest pace in five quarters. they've been writing a rebound in home prices that have led to consumer spending more in their homes. that did not translate into sales growth acceleration this time. a federal court hearing is underway in the tom brady case here in new york. the judges has no settlement has reached. brady is open to some kind of suspension but not for deflategate itself, only for failing to cooperate in the investigation. he destroyed his cell phone. who does that? tesla better take a look in the rearview mirror. audi's coming up fast with a new electric car. they will unveil an electric crossover with a range that rivals the tesla model x. it will be able to drive 300 miles before needing to recharge. i will be thrilled, shocked and amazed if it actually comes to market.

this company puts out more cool concept cars than any other company in the world and never brings any of them to market. pimm: why is that? matt: i don't know. they have the most amazing concept cars that never make it to market. pimm: is that part of the marketing? matt: it would cost too much money to produce, so they will aa's. bunch of a3's and pimm: german lawmakers cleared the way for greece's third bailout plan. $86 billion. the finance minister called the measure necessary. >> the aim of these measures is to get greece to stand on its own to be as soon as possible. it is therefore necessary that greece will have a surplus again as of 2016. the german vote comes just as the greek government's first privatization deal, he forty-year $1.3 billion

concession that will give the german operator of the frankfurt airport control over 14 regional airports. this privatization program as a bit of a snack. snag. a bit of a it was the details. what exactly is supposed to happen but what is happening? the first major privatization since the new bailout deal was agreed, privatizations are a huge part of this deal with the 50 billion euro fund. euros rightbillion away. -- new series a government they were against it. they wanted to renegotiate at. one of the terms of this bailout deal was they had to approve the

concession as it was agreed by the previous government. the government issued the decision at the beginning of the week, improving the terms of that concession. theyerman company leaving acquisition -- they are feeling a bit of buyers remorse. they say this decision opens the way for negotiations to continue before this deal is signed. matt: they want to pay less than this? 1.3 billion euros? said anythingot like that. that is not clear so far. one thing you can say is that in november when this deal was agreed with the previous government, after the , they said they

were perhaps overpaying for the steel. they are seeing a bit of an opportunity to change the terms. in the last few moments, the has tried toent calm things down. we expect the final signing soon. they've expressed their interest in going ahead and renewing the guarantees. from the greek government side of things, they say we've done our part by improving the deal as it was laid out. -- andvious government everything will be up for negotiation. at least two of the airports, one of them is on santorini. very popular destination spread what about other privatization

plans? that should follow in the plans. ultimately, since the beginning --the greek bailout privatization has always been a big part of the plan. they've always come in behind target with snags here and there. this program is a very ambitious one. if you're talking a 30 year horizon, that gives you a sense of how quick they are planning to proceed. pimm: thank you for spending time with us. hackers, they say they released information other to 6 million ashley madison users. if you are using the website, be afraid.

-- 36 million ashley madison users. ♪

pimm: last month, hackers stole data from ashleymadison.com. a business that facilitates affairs for people who are married. the hackers claim to have released the stolen information up more than 36 million user accounts. includes dented up full names, e-mail addresses and credit card data. cory johnson is here with more. you've been serving the dark web? cory: the way this was released was using the dark web. internet pages that can only be reached through a certain kind of browser. a tor rouser. whethers some question or not these were real numbers

or names. an analyst got in touch with a thosel of people saying are our real names and credit card numbers. pimm: the makings of a lot of legal problems for people. they have because some as credit card number and e-mail address doesn't mean people participated in having an affair. matt: most likely they did not. 90-90 5% of the members are male. thousands of the accounts are fake. -- 90-95% of the members are male. cory: including one with 20 blair's e-mail address. blair plus e-mail address. matt: a lot of fake female

accounts. pimm: will this kill their business? cory: they have an interesting business model. every single transaction -- communication you have what one of these people is a fee. you buy credits and use those credits. they have a terrific revenue model. it could be significantly damaged. any plans to do an ipo. pimm: we have much more coming up on the bloomberg market day. ♪ the only way to get better is to challenge yourself,

and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment,

we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. welcome back to the bloomberg market day. let's take a look at the top stories crossing the bloomberg oil,nal -- the price of

its dissent continues. he was crude stockpiles unexpectedly increased. that set the price of wax texas -- turning to politics, jeb bush is getting by with a little help from his friends. half of the $125 million he has raised comes from donors who previously gave to his brother or father's campaigns. there are now 30,000 firefighters and support staff battling wildfires in the western united states. five states are now fighting more than 10 large wildfires each. the forest service has wildfires have consumed more than half of its budget this year.

markets are closing in europe at the moment. let's go to mark barton in london. stocksmerging-market declining on this wednesday session. those companies with exposure to china leading the declines. the automakers, the miners, european commodity producers trading after lowest level versus this broader market since 2002. it is very much a case of europe following emerging markets. groups on they stock 600 following on this wednesday session. since china devalued its currency last tuesday, miners and automakers have sunk 10%. that is a correction. one market did rise on wednesday, the athens stock exchange.

germany rubberstamping the third greek bailout in five years. areanow over to the euro to rubberstamp part of the 86 billion euro bailout so greece can pay the european central bank 3.2 billion euros on thursday. that is the next important deadline. here are the big movers on europe's stock market. performer down 9% today. slumping to a record low. profit falling by 56%. he was wrongfooted by the sharp slowdown in china. carlsberg 9% lower today. ,t issued a profit warning blaming plunging volume in russia. the second-biggest lender in eastern europe, second-order

profit growing better than expected. pimm: thank you very much. coming up here on the bloomberg market day, bank of america failed the stress test back in march. the chief executive come his stress test is not over yet. ,he internal revenue service the homeland security and national parks all joined pizza parlors, beauty salons another services, they will all be reviewed on yelp. how the federal government believes feedback will help you -- help giving customer satisfaction. u.s. regulators have approved the first pill designed to treat low libido levels in women. the fda finally said yes to the drug.

after rejecting it more than two years ago. the drug is designed to treat hypoactive sexual desire disorder which affects 2 million women. the pill could be available to patients as soon as mid-october. let's start off with what exactly is the drug designed to do. >> it addresses a condition that is generalized hypoactive sexual desire disorder. that's women's most common form of sexual dysfunction. it's a condition we've understood medically for 40 years, but not yet until yesterday did we finally have a treatment option for women. pimm: as part of this treatment option, this drug does come with a lot of warnings. one question would be, alcohol use and the use of oral contraceptives. that's not something you want to mix. contraindicated

they are both metabolized the same way. we made sure he did not have any effect on oral contraceptives. those can be co-used. of the mostcrease common side effects with that color ministration. -- coadministration. we will go out with a program. we will go forward with physicians, health care providers, pharmacies, take them through a slide deck online. they will take a knowledge assessment and become certified. eating this right for women is really important for us. -- getting this right for women is really important to us. we are delighted that women finally have the choice. tell us the story of

getting the drug approved. it had not been approved by the fda. you work with an advocacy group that helped to make this possible. >> science made this possible. an expert panel was assembled by the fda back in june. they voted 18-6 in favor of approval. that group was looking at a whole lot of scientific evidence. every step along the way, we have done extra clinical work. , we are oneadvocacy of 26 members of the coalition change thegned to conversation to patients became the center of this conversation. much of that credit goes to the fda. pimm: what is different about this formulation that was not approved before? >> not different in terms of formulation but different in terms of scientific understanding by more data. more data in terms of challenge studies, another pivotal trial,

more evidence that made us comfortable that we had a level this label to inform patients. pimm: how much does something like this cost and how do you take it and will it be reimbursed by insurance? bedtime,once daily at nonhormonal pill. we've looked at prices not yet set, but coverage rates for male sexual health drugs. 70% of men with insurance have those covered. we would expect parity coverage. pimm: how it's brought pharmaceuticals come to have this drug -- how did it sprout pharmaceuticals come to have this drug? --we had the mail sex drugs the fda recognized this as one of their -- pimm: this came from a german

company. you ended up buying this. >> the great original innovator of the compound made a strategic decision that sexual medicine was not one of their areas of focus. it wasn't exciting time to jump into the female side and address that need. this is been about getting women to choice. men have a lot of treatment options. what about the reality of money raising when it comes to marketing this? you are a small company. how will you pay for all of this? >> we will do a very deliberate launch out of the gate. we will go to health care providers. pimm: you will do this yourself. he will not partner with another pharmaceutical company? >> ultimately, we would love to see women across the globe have access to this treatment. capacity to do

that. we will start building with money that we've already raised and look to the future of globalization. pimm: thank you very much. chief executive of sprout pharmaceuticals. bank of america is the only big bank that did not pass the federal reserve stress test in march. brian moynihan has more than a month to prove the bank can win approval. ♪

pimm: welcome back to the bloomberg market day. let's look at the top stories crossing the bloomberg terminal. president obama will visit new orleans next week to mark the 10th anniversary of hurricane katrina. katrina slammed into the gulf coast creating a storm surge that flooded large sections of new orleans.

2000 people were killed. south africa says it has a plan to have oscar pistorius released early from prison and be held in house arrest. he was scheduled for release on friday. he was sentenced to five years in prison for killing his girlfriend. he has served 10 months of his sentence. the group says countries facing cash shortages may be tended to sell part of the gold reserves. venezuela receives 95% of its export revenue from oil. the collapse in oil prices has led to speculation that venezuela may have problems paying its debts. turns out that those federal reserve stress tests are pretty stressful for the bank of america. they are facing a september 30 deadline to fix weaknesses in its bank.

that could turn into a make or break moment for brian moynihan. the internal stress tests that brian moynihan faces that she spoke to cory johnson and olivia sterns earlier. -- he spoke to cory johnson and olivia sterns earlier. moynihan --brian they screwed up three times. the investors are getting impatient. >> this is the do over for the third round of stress tests. mike at citigroup said if we can get this right, i should not be here. they got rid of their cfo. they said it was amicable. this is coming at a special time for brian moynihan. >> he did not take the summer off. >> he's at risk of losing his

chairman title. >> we are talking about feeling stress tests. that suggests perhaps a lack of oversight. isn't that an argument to have an independent chairman? >> that's what a lot of people have said. it comes at a bad time for brian moynihan. voteare holding a special eight days before the stress test is due. people will be upset and talking about this. >> the vote before is better than the vote after. >> exactly. these guys have until may 2016 told about. best to hold a vote. >> it makes you wonder if that suggests that they will not pass again. andhey knew they would pass he has control over the board, he would pick the date after. >> i think he gets reelected chairman.

there is a question of whether or not they can pass a third time. >> why are they feeling the stress test? >> you have these huge institutions, sprawling technology and they come from dozens of acquisitions. to get all the technology working together -- >> these guys have cobbled together more big, weird assets than any other company. are they still trying to digest -- there's a lot of acquisitions they have made in the last decade. absolutely. when you make an acquisition, you have to say we will spend billions of dollars to get these systems together. or, we could do better on her own sheet and do it that way. >> one of the chief criticisms

was that in the board suggestion to keep them as chairman and ceo , they did not mention the $4 billion accounting air. the sharer. >-- error. >> that was their second strike. their turn to make sure all the data from the acquisition is accurate. that was from merrill lynch. hugh song was speaking about brian moynihan. , federal agencies joining food trucks, doctors offices and other service organizations to be reviewed on yelp. how your review could help the government customer service. ♪

pimm: federal agencies such as the transportation security administration, the irs, they will be joining beauty salons and pizza parlors and other services to be reviewed on yelp. the u.s. government says it posted this in hopes online ratings will improve customer satisfaction. reviews for federal agencies. betty: if you are unhappy with the way you've been dealt with at the irs, if you don't like the bathrooms at your state , and fueling the service at the post office, you can go on yelp and event.

is the government formalizing this and saying we are watching you and we are going to respond. i don't know if you want to vent at the irs because it puts you on their hit list. it's the government embracing the digital age. also, the age of us sharing and democratizing information. there andcan go on say how they feel about the government. i think it is a bit of a risky move. the government is opening themselves up and saying go ahead, criticize us. pimm: here's the thing i will try to understand. many of the services and the businesses that are on yelp, you have a choice whether you want to deal with them or not. you can withhold your business you can go somewhere else. whatever it is. customers rate them and give them stars.

you say you had a bad experience at the irs, it's unlikely that anybody else will be able to say that is great, i will go to another irs. government is essential versus these things are optional. betty: good point. however, this is -- now you know if you do this on yelp, someone at the irises collecting this is collecting this data. that is the hope. wouldn't it be better if they secured the irs website against hackers? betty: that's another big story. if you aggregate all of the tendws on yelp, businesses to get more positive than negative reviews. when does somebody write something? when they are not happy with

what they got. in fact, it is more positive than negative. i guess the government said ok, maybe we will follow that statistic. pimm: you will have to find who is in charge of collating all this. betty: feel sorry for that person. pimmand you ever written a revin yelp? pimm: i have not. thank you. it is now time for today's options in sight. we are approaching the top of the hour. let's take a look at how the major averages are performing. we are pretty much back to the levels we saw on monday. all three indexes have given back the gains they notched in the past two days. it's often emerging markets we saw around the world and the prospects of higher u.s. interest rates next month. odard.e as jared

you are looking at the fix today -- hitting the highest mark since july 10. how are you feeling about this right now? >> we've noticed the cost over the last several years of protection and upsized calls protecting against equity volatility has been steadily rising. rising as a function of the cost of options near the money strikes -- if you want to buy the vix futures at 16 and he by the cost of a 25 call relative to that has been steadily increasing. investors are paying more and more for protection and demanding more and more insurance against the market even when market volatility has been tame. >> you say investors have been able to hedge this for free air moderate --gainst a

>> something we've been doing with clients for a while. it is called the vicks call ratio. cell two or three upside calls expense on thet upside. that gives you protection against any kind of churn in the market. if the s&p rallies, you keep the credit you received. , youe market sells off would make several multiples of your initial outline. the real risk is in a very -- the trade for today is looking at the september expiration, buying the 16 strike call one time, selling the 20 strike call three

times. that is the credit you would receive if the market stays sideways or goes higher from here. if the market sells off moderately, you could make four times that amount. looking ahead to september, what is your expectation? >> i expect a quarter-point increase. that is a reasonable case. this ties into the trade, there is still a lot of skepticism among investors and portfolio managers about whether the economy is as strong as some data has suggested. it is. faced with that tension, some people are going with ideology rather than market data. if you think there is real potential here, the nonfarm

payrolls and hourly earnings could make some believers. you could see people take more risk off the table. a prefab hedge, better to hedge or better -- >> some people like to position for expected news ahead of the event. rather than waiting for the fed to confirm the increase in economic data is in strong, they may move ahead of the event. that's why i hedge right now. >> thank you very much. we will be back after a very short break. ♪

pimm: good day. it is 9:00 a.m. in scope, noon in new york -- 9:00 a.m. in san francisco, noon in new york. betty: an unexpected rise in

american crude oil stockpiles fueling the route in energy stocks. pimm: we will look at earnings from target. the company's cost-cutting efforts are beginning to pay off. betty: the launch of microsoft's xbox -- the changing landscape of the videogame business. pimm: good afternoon. betty: let's begin with a look at how the markets are at this moment. -- weis a rally underway are sinking to near our session lows of the session so far. the s&p down 1%, the dow off by 200 points. we have lo