what happened to today's rally? the dow is up nearly 400 points. looks like we are up about 200 right now. alix: clearly unable to hold those levels at this time. the s&p and the nasdaq also the best today rally since 2009. olivia: it is hard to figure out what the catalyst is. the u.s. economy grew at a revised analyzed rate of 3.7%, which sounds huge. it is also perhaps the news that bloomberg was reporting that the chinese government actually did intervene in the stock market today, buying up some blue-chip stocks, the equivalent of their large-cap stocks. that is why we saw the chinese market actually rally for the last -- for the first time in the last six days. china is selling the

treasury, selling u.s. treasury's in order to help support the u.n. when you have these interventions in the currency market that creates a much volatility, that has to bleed over into the start arquette. -- the stock market. you know what i wish i had bought yesterday? oil. alix: yes. let's look at the big spike we have seen. this has oil versus of the eight-day and 10-day moving average. this portion right here, look at that, that is the bounce we saw from oil over the today averages, meaning that this seems to be like -- two-day averages, meaning that this seems to be like a technical trade. at one point, the most in six years. if it is all technical, it will reverse. alix: interesting. technicalownplay

reasons for market moves. -- i want to show you dow stocks that are trading at their 52-wicklow. -- 52-week low. a huge amount of selling. it goes to the point we have made a last couple of months that your today, the racket -- the rally we saw in the u.s., the s&p was often couple of percentage points, but a shallow rally. that is a great point you make. alix: the oversold conditions which could have justified the rally we have seen over the last day and a half, with take a look at the price-to-earnings ratio on the s&p. down 11%, the lowest since february 2014. there is so much damage but you could not help by the stock. it doesn't necessarily mean that it is an all clear sign.

let's take a look at some headlines. ,lix: the economy grew faster and nra to 3.7% gdp -- an annual of 3.7% gdp. it may be a sign that strong growth will be tough to sustain in the short run. olivia: average long-term mortgage rates dropped this week. the benchmark rate hasn't been that low since may 21. the rate on 15-year fixed mortgages declined to 3.06% from 3.15%. rose pending home sales one half of 1% in july.

consistent job growth is helping the real estate market as well. olivia: president obama is in new orleans to celebrate its come back from hurricane katrina. waspresident's first stop to one of the oldest black neighborhoods in the country and an area still recovering from the storm's devastation. alix: usn turkish fighter jets will soon begin fighter strikes against isis. under pressure from the u.s., turkey moved to the front line july. war against isis in they also granted the united states access to an air base in the southern part of the country to help reduce flight times. olivia: and on the campaign trail in cleveland, ohio, hillary clinton has strong words for the gop on their stance on women's health. views onton: extreme women, we expect that from terrorist groups. we expect that from people who do not want to live in the modern world. but it is a little hard to take who wantom republicans

to be the president of the united states. yet they espouse out of date and out of touch policies. they are dead wrong for 21st century america. we are going froward. we are not going back. she cited marco rubio's push to make all abortions illegal, including rape. republicans call her comments a new low. alix: a sinkhole in a chinese city solid five people. four people were injured when the sidewalk they were standing on suddenly gave way. that's one of my biggest fears. three people fell straight into the hole while one woman clung to pipes just underneath the sidewalk. those are your top stories. olivia: that is legitimately terrifying. alix: absolutely. olivia: it is that time of year

again. back-to-school. it is that time when members of the federal reserve hangout to -- head out to jackson and whole and hang out at the cowboy bar. we are joined by the vice-chairman of the federal department vice chair. erik: as you can see, the mist has burned off of the top of the mountains. we have tom ponied with us. you have been talking recently about something that is very dear to the hearts of our audience, which is changing the way banks are regulated. you are focusing on smaller community banks. hoenig: what we have said is that dodd-frank is a significant

piece of legislation. it brings more relation forward. and it does fall unevenly across the banking industry. smaller brinks are more disproportionately affected. they should be exempt from some of the regulatory burden. that is important to dodd-frank and related rules. reporter: it also means how you define a small bag. what you said recently is that size is irrelevant. how do you find the kinds of banks that would be granted this kind of waiver? mr. hoenig: we think of it as a traditional bank. londongage primarily in -- in lending and deposit taking. bank that does not engage in trading, does not

involve yourself heavily in derivatives, although you can still do for an exchange and some interest rate swaps. if you do not have more than, like, a $3 billion in net derivatives on your books, then you are eligible. come under the regulatory relief if you hold 10% of tangible capital assets. we defined this and we looked and found that 90% of commercial banks would meet this criteria, at least the first three. and two thirds would make the last, in terms of capital requirement. and the remaining one third of those banks could meet this with 200 basis points, at least 8%. which is it a hard myrtle -- which isn't a hard hurdle to meet. ratio.ld have a leverage

this is the capital, the ownership capital that you have. and you will not have to do all of these complicated calculations. you would also have more flexibility in some of the mortgage lending. if you write euro books and you meet this criteria, you would qualify to take some of the burden off. some of the consumer rates would not be eliminated but it could be more flexible, what has to be referred. appraisals, you would be eligible for less burdensome requirements on appraisals so you can engage in lending, which is what you want a bank to do at the regional or a community bank size. we have banks that meet the the $100that are in billion or near threshold. it is by what you do, not how large your. i think it should be considered carefully. we posted that on her webpage.

and then we do q&a so people can ask about it and see if we can address some of the issues. tom: they get have something with you as well. they don't like the leverage ratio issue. they say they are wholly collateral for their clients with derivatives contracts. what they say is that todd -- dodd-frank is a blunt instrument. you say that it should be a blunt instrument. mr. hoenig: this is how much equity you are willing to put in the game and be responsible for any have to decide what businesses you want to be in. to say, well we have collateral, imagine making collateral -- making alone and you post collateral with me and i say, well, now you can take that off your balance sheet. it doesn't make sense. so what your total assets? how much d you have behind that? and you just -- how much capital do you have behind that? and you just distribute the capital. i don't want them so extremely

leveraged that come alone we have stress, the government has to come in and promise liquidity and all of the sorts of things. reporter: what do you think of ellen screen dance -- alan screen been -- alan greenspan's recommendation? mr. hoenig: if you can get the ,hole industry 20% real capital it sounds at may believe, but real capital. i think you could have a letter regulatory relief and there. one of the decisions they made in the debates in 2010 around dodd-frank was do you want to some fire industry, specializing and have commercial banks and investment banks and trading banks be separate? and they decided that they wouldn't. so it takes reversing all that, which means more capital and simpler models. and we will have to see if they

are ever willing to do that. tom: some people on wall street say the problem this week is dodd-frank. banks won't take risk. there is no one to come in and take the falling knife. and bond dealers cannot take any inventory anymore. there is a law of unintended consequences at work. mr. hoenig: i find that a little bit hard to accept. i can think of a menu of reasons. one, we have had zero interest rate for seven years. you put lots of money into the system. it has to be deployed. riskier assets are designed to raise asset failure. so what about the relations? title i, whether we do bankruptcy. title ii, how do we do other problems? i think the fact that we have such a highly leveraged industry -- and they say we are much more aretalize now -- well, you

more strongly capitalized, but are you adequately capitalized? when you take all the off-balance-sheet items and you look at how much risk there is there, the amount of capital, tangible capital, against all those assets, on and off balance sheets, it is fairly thin still. and i think we need to be mindful of that when we talk about fragility. reporter: one of the things that we talk about is how do you make sure the regulations you are proposing for smaller banks to take risk don't become cover for getting rid of dodd-frank altogether? mr. hoenig: that is one of the reasons we made it very clear. you can't be engaged in trade. manyan't be engaged in derivatives activity, outside of hedging. you have to be a traditional bank. the requirement for that is 10% tangible capital. i think that is twice as much, if you take the off-balance-sheet as the current levels held by the largest bank. much stricter. i think these banks know that they are not too big to fail. they know they have to have

capital. clearly, when the markets discipline you, you acted differently than when you think you have someone backing you up with lots of liquidity and deposit insurance. straight that was talk. you can't see it, but i promise you the was wearing cowboy boots. olivia: thank you so much. back to brandon and mike tomorrow for more coverage at jackson hole. alix: at one point, the dow was jumping as much as 381 points. then 80 raise 250 points in 30 erased 250then it points in 30 minutes. it is like whiplash oliver again. julie, i have been scrolling through our headlines. have you seen a catalyst? julie: i sure haven't. but we haven't seen many in the last several days that have been causing wild swings in the market. on a personal note, i am glad i

mentioned earlier that things are stable for now. i kept doing myself little disclaimers because we have been seeing this crazy action over the past several days. all of this whip selling in the markets. look at this chart that really tells a story of what we have seen here in the dow in particular -- senior. the dow in particular getting to the unchanged level or the negative level before bouncing back a little bit. .6%. up but for the major averages, we have seen the biggest two-day gain for the dow since 2008. it looks like that is happening no longer at this point. really, this move has been mirrored on all three major averages. look at myake a bloomberg terminal over the past several days. just a illustrated this whip sawing that we saw happening in the markets. this is three sessions ago. we saw a rally at the beginning of the day and then things fell off a cliff at the end of the

session. then the following day, we saw yesterday things muddling along, dipping a little bit around midday, and then coming back strong through the close. there has been this unexpected nature. you see the chart today. there is definitely this unpredictability as we have been looking at stocks over the past several days. that has happened in the three major averages. if you look at the vic's -- the vixie -- the vix. it is down about 4%. we tend to see the vix fall when stocks are rising. the measure of so-called here is down and we have seen this bouncing around quite a bit today. it has risen as stocks have gone down and it is not a more historical line at around 30.

we have also been watching other assets. the dollar, for example, we have been watching as all of these gyrations of stocks have been going on. we saw this climb up and come off the highs pretty sharply, now off by one and a half percent. the market today -- the story today has been oil, the huge gains in oil prices. the me see if i can pull up the chart in oil. we have seen a come off the highs but really hold onto substantially much of the gains. the highs of the session, it was up as much as 10%. still trading close to $42 a barrel. asseten't seen it across classes as sharp of a move, although the shape of the charts is roughly the same across the asset classes. olivia: the trajectory. julie: yes. alix: i like that you brought up oil. julie: of course, you do. alix: it was really energy stocks that were leading the

galley -- the rally today. overall stocks have continued to deteriorate, diverging a little bit from what we see from the underlying commodity market. this does me -- this is to me that this is a stock-driven market. alix: julie does actually eat lunch. i was covering markets. energy stocks on the s&p 500 were up more than 4%. so it is really a big turnaround. alix: so a loss of about half of that value. olivia: the bounceback we have seen come if we can call it that, it might just be a one-day rally, depending on where stocks settle at the close. it has been much more shallow than the selloff was. what have you seen today? julie: a similar situation today. even when we had the nasdaq at the highs of the session, we are still down on its highs for the year. you're looking at the imap on my bloomberg terminal. we saw more than 4% at one

point. it is still the best performing group in the s&p. by now it is up 2.7%. to your point about what we have seen in terms of recouping the losses or not recouping losses, as the case may be, here is the year-to-date chart on the s&p 500. we were definitely poking along. -- plugging along. we saw that sharp decline of 11% from there through the lows a couple of days ago. yes, we have seen the retracement, in the words of technicians. that is what they call a rebound. we definitely have not -- i mean, this makes it very clear. we are not back to where we were. olivia: that is an incredible 12-month chart. thank you. 150 points, but off more than 200 off the session lows. alix: we are going to recap bloomberg politics, donald trumps interview yesterday, and an ion the markets. the dow is now -- keep an i on the markets.

the dow is now up by 150 points.

olivia: donald trump family detailing his economic vision for america. alix: it turns out it includes raising taxes on the wealthy. trump revealed this and much more on his interview on "all do respect" yesterday. joining us now on that is mark halperin. there was a lot of great stuff in that interview. what was your favorite? mark: so much to choose from. we tried to have a serious conversation with him about things like the debt ceiling and tax policy. feel it we know i'm a little but there is still a lot to learn. hime tried to -- know about -- the country, we feel we know him a little bit but there's

still a lot to learn. he knows a lot of business people. some people think of him as a reality tv star. but he is a guy who made billions of dollars in the real estate business and how vision and selling his brand around the world. carl icahn is someone he is friends with. if he starts winning some of these primaries and caucuses next year, you will see more people come forward. olivia: there are people tried to make an issue out of tax versions. i wonder if that will resonate -- tax in versions. i wonder if that will resonate on the campaign trail. mark: he talked to icon about it. by peoplede fun of say he is superficial and he doesn't understand things. but he does understand business and we will see over the coming weeks as he starts to put out more policies. so far, it is just immigration, but he does say he will put out tax policy and other economic things. we will see if he has a figure feel.

if the country is going to elect a business person as president, they will have to make their strong suit, which he says it is, understanding the economy. alix: he did come out more aggressive on hedge funds and report of the middle class, not something you necessarily think of when you think of trump. mark: the guy has a great figurative feel for where the political sweet spot is on issues. one of the things he talks about now and he didn't interview with us -- he did an interview with us in a very reasoned way. middle class economics, helping the middle class, not the wealthy. that will appeal to a lot of people. mitt romney had trouble with that. if you look at who supports donald trump, at least some segment are people who say he may be superrich but he understands the middle class. olivia: there has been no video licet of a product party were donald trump says that 47 -- although that is the kind of thing he would say. what did he have to say about jeb bush? mark: he has been critical of jeb bush. jeb bush has been fighting back against him. john and i have talked about this.

a world-class kneeler. he knows how to get into people skin. we saw -- we showed him video of jeb bush. we asked him if he seems low energy. he said, no, he seemed higher energy but he still put in a big dig -- a bit of a dig. why would folks prefer someone like donald trump who is superrich versus a mitt romney who was also superrich? -- that is a some question that everybody in politics wants to know. i think what it is is trump's speaking style, his attitude , andds career politicians it accounts for his ability to draw support from working-class people the way mitt romney did not to a large extent. olivia: and let's be honest. trump owns it. he tells the fact that he has become a millionaire.

ron nature i take the spotlight off of his wealth. mark: drums brand is associated with luxury, right, hotels and his television shows and a tall building. romney was in a business where he had trouble, as you said, openly defending what he did to create jobs. trump does have a lot of employees. he has created a lot of jobs. but people have not focused very much on the downside of his businesses. i'm sure that will come in time. but he is able to talk about success very freely. alix: thank you so much. olivia: don't forget to tune in tonight on "all the respect." we will be right back.

alix: welcome back to the bloomberg market day. we want to get straight to the headlines this afternoon. officials in australia believe that the partially decomposed

bodies of migrants on a highway may be up to 50. balkan nations have been overwhelmed this year by tens of thousands of migrants trying to get into europe. a poll released today may add to the spec elation about vice president joe biden and a run for the white house. he is polling better than the top three republican candidates and hillary clinton. it also shows that he has a higher favorability rating than hillary clinton or bernie sanders. biden favorably compared to 76% for clinton and 54% for sanders. mrs. clinton: he has to make a very difficult decision for himself and his family. he should have the space and the opportunity to decide what he thes to do during olivia:

polls did have good news for clinton. the new york times is reporting that joe biden told democratic national committee members that he was uncertain his family had the "emotional fuel for another presidential campaign. his son died on may 30. consumer confidence in the u.s. has hit a five-week high. respondents to a comfort index survey were more optimistic about their personal finances. the poll was conducted before this weeks stockmarket slump. first-time claims for jobless benefits fell to a three-week low. since the beginning of march, they have stayed below 300,000, a level consistent with improving labor market. as the federal reserve holds its

annual retreat in jackson hole, wyoming, will the jackson -- will the fed begin to raise interest rates. mrs. george: we should expect volatility from time to time. we are in a period of some uncertainty, questions about china, questions about global growth. i think we should expect some volatility. what it means for monetary policy, i think it is not yet clear. it is a convocation, something we watch, but i'm not ready to say it has some particular long-term effect. taperingfed held off in the face of volatility in 2013. the argument at the time was that volatility had led to tightening financial conditions. we have seen spreads widen recently. spreads of widen,

but the market came back today in the u.s.. it is too soon to tell what it means. that, of course, markets operate in short-term, short spurts, reacting. i would like to wait a little longer and understand what it might mean more generally for the economy. stabilizes,market september will still be a live option as far as you're concerned? ms. george: i think the fomc has signaled that every meeting will be a live auction. -- life option. at this point, for me, i have not seen something that would change my own sense of how the economy is doing. tom: do you think the fed at this point may want to look at changing its reaction function to risk management or is it too soon to say on that? ms. george: i think that is a discussion the committee has to have. saying forave been some time, as i have seen the economy consistently grow, as

labor markets have improved, i thought there was scope to consider rate increases before now. but we will we and see what the committees thoughts are -- the committee's thoughts are. tom: you have had a number of prominent economists say the needsal -- the turmoil easing from the fed. wouldn't you take it that way if you were on wall street? on george: well, i'm not wall street and a policymaker's job is to look at the long-term. that is why we have to be careful trying to read too much income a try to decide today how we might react to that. i think that takes more time and we have time. we have until our september meeting to see how things look than. tom: a lot of people on wall street say that a large portion muchat is to blame is so

pumped into the markets. that has inflated too much. is it better to get out while you can? george: i am always in defense of the variations of qe. they were designed to boost asset values. this could be a consequence. this could be one of the cost down the road. i think we have to be mindful of that. we have to think about that in terms of the timing of our policies. tom calling signaling in guidance, what a september meeting move impact markets and the economy by reinforcing confidence in the growth outlook that the fed sees is getting better or, if you held off, it would suggest to people the fed sees the economy getting worse? ms. george: we will have to see at the time of the september meeting. my own view has been for some time that the economy is strong enough to begin that normalization process. i think that would be a sign of confidence.

it would limit some of the uncertainty that i think is out there today. inin, seeing where we are september around those issues i think is going to be very much part of the decision. credibility in the long term will be determined by how effective policy is. and i can't prejudge potential policy errors, things that might react. about how we clear see the economy, thinking about the long-term risk to sustainable growth, for me, has argued that we should move sooner rather than later. the longer you wait, more complications i think can build up. tom: the longer you wait, based on your forecast, does that mean a steeper, faster turning? ms. george: it could. we have been a zero for a long time. i think it is reasonable to expect this idea of some

volatility. i would like the opportunity to see how the economy responds and be in a position to know whether the past is a more gradual and slower path as opposed to a more rapid one. alix: that was kansas city said president esther george. speaking of market volatility, oil is seeing a major rally, rising about $40 a barrel, rising the most. prices are with fleshing out. i'm going to need a xanax everyday at like 3:32 handle these markets good joe: they are really wild. each day, we have had big ups, big downs, big moments were in seem like they are going to collapse. right now, markets are looking resilient as we get to the close. yes, you need a xanax, but -- olivia: 15 minutes ago, that there was a pass l.a. that the dow could go negative on the day.

joe: we were up by less than a hundred points and it was coming down really fast. jpmorgan had a note. they said there is a large pool programmatic, is that there -- that they are trading equities regardless of fundamentals and that is what is disrupting the markets. we do tend to see a lot of this going into the close. joe: absolutely, that is one of the stories of people .2. there are a lot of interesting things going on with market structure and debate on how much is this programmatic buying and selling. i think for a long time, the events we have seen the last four days, this is on to be one of those periods that are -- that is very autopsied. freeport mack brown, foreign goal, they said they would cut down on jobs. investors like that. he will get their house in order

and getting their house in order will help the oversupply of copper. joe: i think the big market story outside of the headlines is the really beaten-down minors and we have talked about how much company is like glencore and those have been crushed the day after day after day. finally, they seem to have caught a bit. obviously, oil is having a monster day, one of its biggest days in years. so after so much pain, finally, eventually you get the day that you get a spike in today was it. alix: but it's still about the it isne read your oil said is pushing for an opec meeting. is it really going to happen? sorry we didn't cut the last time. why would this time be any different. so this bounces either technical or on the headlines could be short-lived also. joe: the fundamentals of supply and demand are going to change

rate quickly, and a matter what. though we could be in a situation where selling in commodities was overdone, even giving the fundamentals. it was just down everyday with those stocks. now the whole commodity-oil-materials index is doing very well today. will be back in 20 minutes to help me get through the close. don't forget to tune into our show, 4:00 p.m. eastern standard time. markets.tching these the dow up again over 200 points. lots more coming up on bloomberg market day. will we be able to sustain these kind of games into the close?

alix:alix: we want to look at the markets for 15 minutes before the bell. we now have the dow 220 points. again, there isn't a fundamental reason for the stocks to come back and are being up only 100 and. it has been a very difficult our -- hour. julie: as you say, we are not quite at the highs of the session, but the trajectory is now upward once again for the major averages. it has been a baffling session. you were just talking about one note from a strategist, from jpmorgan, may have contributed to the debt. -- the dip. but it is hard to pinpoint it on one thing. if you look at the intraday chart of the s&p 500, you can see the movement more clearly we are talking about with the s&p. it went almost unchanged before

bouncing back here. i want to repeat this, because it is worth talking about again move,the three-intraday maybe we should get used to this. just two days ago, we saw the s&p heading along, plugging along with the rally, and then dropping in the last hour. then yesterday, we saw things a little bit volatile and then a strong rally at the end of the day. what we are seeing today is par for the course of what we have seen the last few days. #moves. we talk about the role that big energy stocks of them playing. that does continue. this is another group that is heading back towards, not quite towards the highs of the session. oil does not see the same magnitude of moves we saw for the other assets for stocks in particular. it has been mostly up as we have been in the regular session.

it looks like potentially having its biggest one-day gain in about six years time if we do hold onto this kind of gain. 10% right now, incredible movement in oil. i want to check on a couple of other important asset classes. as we hear from various fed officials, we will be hearing from governor fisher on saturday very we have to figure what is going on with the 10-year. not as big a move as we saw yesterday, for example, when it comes to rates. finally, the dollar looks like it is set for its biggest three-day gain is 2011. and here we are off the highs of the session, too. alix: thank you so much. for more on the markets, i want to bring in brian belsky.

he joins us from the toronto stock exchange. how do you handle the last five days of the market? brian: you handle it with fundamental analysis. at the end of the day, stocks are rarely linear for long. it seems like, really since 2009, this has and frankly the most dreaded, hated stockmarket rally in the history of rallies. i can't tell you how many clients really, since 2009 and during client meetings, i'm sorry, have been consumed with trying to predict the market. in my special report on monday, what we titled the bottom of an economy, the u.s. edition, there's a hard time understanding the changes going on in the fundamental macro landscape of investing area people are still too focused on china. what we think and what fundamentals are telling us here

in the united states, in north america, u.s. companies are going to lead. north america is going to lead in terms of growth area that has not been the trend the last 15 years. people are having a hard time holding onto that. alix: it sounds like you are really focusing on those fundamentals and but the snow from jpmorgan talking about level anding and the the selling that they could add to the market over the next few weeks, upwards of 50 to $300 billion -- $50 billion to $300 billion. does that really matter at this point? brian: at the end of the day, we had to focus on today tomorrow and the next five minutes area we have to look at what the trends are from a longer-term perspective. the problem with investing right now is that we really lack effective. institutional people that we

talked to on a client basis and some of the people that do what we do, we weren't around in 2000 or even in the 1990's. we have the great fortune of having some gray hair and being through some cycles in the last 20 years of the business. and we try to outsmart ourselves your we are trying to find the negative call all the time. what's wrong with being positive and optimistic? fundamentalst the of the united states stock market, it is positive and optimistic. our comment would be why try to be negative all the time? let's look at being a longer-term investor and be comfortable with those names. alix: nevertheless, when you wind up seeing the massive volatility we saw in the rinsing market, for example, and if you look inside my bloomberg terminal, you can see what i am talking about very you are looking at the dollar versus the yen and the gyrations we have seen over the last few days. the yen is supposed to be the safety plate area currency

markets aren't supposed to act like this. so how do you invest in stocks when the huge asset class has gone crazy. -- crazy? brian: you said the last few days. we are consumed with daily investing. we have to be looking at the longer-term. -- we said that 2015 and ,016 would be excess volatility especially the type of rally we have seen in six years. it's going to cause a lot of gyration with investing in, especially with the dollar rise, a scenario that investors do not understand. investingppening with right now is what i call the record relation of stocks and correlated.all this is an area that most investors do not understand and

they do not understand it is a positive thing for stocks on the term. alix: what is your checklist when we have these dips? we are overweight financials in america, industrials and technology are. the domestic growth industrials make the most sense are fundamentals -- and are verymentally sound aired strong earnings. by the way, the most innovative sector in the world. we think those three sectors will continue to lead from a longer-term perspective. that is where we are overweight in the united states. alix: good stuff. much more ahead, we are watching the crazy moves in the markets.

the dow is now a 300 points. we are looking at a 2% gain now in the nasdaq. an unbelievable reversal when it looks like the dow was inching towards a negative reading on the day. ♪

alix: you are looking at a sustained rally. the dow of 315 points. mike, you sent me that article about the jpmorgan note about ramik trading and what that means area can you explain to us? mike: this is one of the most detailed strategist notes did marco colada mitch targeted three styles of investments. you adjust the

leverage in your portfolio, depending on how volatile the stocks or assets in your portfolio are. another is trend following strategies, if stocks are going up, you keep buying it. if it starts going down, you start to show it -- shorted. so momentum-based. another one is insurance annuities. he said these things do a lot of these trading off the signals. and risk parity. based onyour portfolio how much risk the certain assets have. so you overweight the less risky assets. all told, he believes these things are having -- are really going haywire. $150 billion to $350 billion of pressure. programsot of these these things are based on a wrecking down. you have stocks selling off in

the two weeks after china the valid the yuan. normally, you would get a rally in longer dated u.s. treasuries. this is a safe haven asset. this is an asset that should do well. what did you get? losses. how does this make sense? today, we started to have questions -- it has been going on for a while -- is china selling their longer bond treasury holdings? whatever it is, the correlations are breaking down that these programs are based on. alix: the reason i wanted to bring up this note is that jpmorgan has highlighted this will lead to volatility, especially to closes. we have seen that since tuesday. yesterday, we did have a sustained rally. today, we thought we were going to go negative but we were able to rally. that is creating this very difficult environment. mike: and a lot of imbalance towards the close, way more buyers and sellers on sundays and vice versa. andisa said -- on some days

vice versa. said, every sort of assumption has been knocked out one by one, starting with the drop in oil last year and the you wanted everything else. alix: oil is now seeing its best day intraday since 2009. lisa: since 2008-2009, investors have been skeptical of traditional strategies. they don't want to go all in stocks. they are looking for these alternatives and these alternatives are having some ramifications. alix: thanks. we are having a look at the close. "what you missed ahead" we will be talking much more.

. .

the: we are moments from closing bell. i am alix steel. joe: and i'm joe weisenthal.

alix: volatility in the markets. let's talk about the whiplash. the s&p 500 van saying, bounces up. is, but the question "what'd you miss?" a stoxx whiplash. a huge surge lead in the day. with so much turmoil, will the fed still raise rates? we have the chart. factor. the volatility one bet most traders think will fail. alix: stocks rallying for the second day, joe, yes, but this was a very volatile trail. at one point, we had the dow up 350 points. we sold back. the dow was up only 100. now we clawed back