biggest really gain 2008, rising more than 7.5%. scarlet: apple will be holding hours --t event in two from a new iphone to an improved apple tv, we will look at how it could impact apple's bottom line. off: yahoo!'s plan to spend alibaba stock has been dealt a setback after the company reveals it withdrew a setback from a ruling from the irs after it received for the agency would not approve the deal. scarlet: good morning. i'm scarlet fu. pimm: and i'm pimm fox. we are 90 minutes into the trading day. let's look at how stocks are moving. the continuation of yesterday, maybe a followthrough.

the dow jones industrial average adds about 21 points. the nasdaq is basically unchanged. scarlet: we had a strong opening and it kind of faded. come inside the bloomberg terminal. you can see we are just off our session lows right now, still clinging onto gains. look at it over three days and you can see how we open higher and have been coming down to the unchanged line where we were yesterday. this is on the heels of a big gain yesterday and a decline on friday before the long weekend. pimm: taking a look at the chinese stock market, one the that she called the selloff and is calling for a rebound of about 4.5%. there are many companies in china are attracting what you

might ascribe as value investors and you may be familiar with .his company this is a liquor company, down about 20% since june. it has been around the 17th century. scarlet: my guess is a value play in china is a little different in a value play in the states. pimm: let's look at oil and copper. 1.25%.rude, down about crude in europe following a decline and copper futures basically unchanged. risk on appetite still seems to be going on when it comes to treasuries because you have yields heilemann -- yield higher. earlier at itsld highest in almost one month, at 2.25%. you are going to do

currencies next. scarlet: the yen is weaker and remains weaker. the market taking its cue from the equities rally with the dollar strengthening. the euro is little changed at this point. pimm: let's take a look at some of the top headlines at this hour -- puerto rico is facing a huge cash crunch. it new economic plan shows a $13 billion shortfall for debt payments after taking into account spending cuts and revenue enhancements. there were no estimates of potential losses for the holders $72 billionco's worth of debt. citigroup warns the next global recession may be made in china. they say there's a 55% chance of some form of worldwide recession in the next couple of years. the bank says it will become by

falling demand from emerging markets, particularly in china. scarlet: hillary clinton has joined those who support the nuclear agreement with iran. as congress debates the measure, the democratic front runner weighed in. now there is a competence of agreement on iran is nuclear program. is it perfect? of course not. no agreement like this ever is. but is a strong agreement? yes, it is. and we absolutely should not turn it down. scarlet: the fate of the iran agreement has essentially been decided. president obama has left votes in the senate to sustain a veto. shares of barnes & noble are falling after the largest u.s. store chain posted a first-quarter loss. went off their college bookstore business and that means they consist of 600 book stores in the note e-reader divisions. toyota unveiling its redesigned

prius a las vegas. -- in las vegas. fuel economy has been improved, the new prius gets about 55 miles a gallon. coming up in the next hour, linkedin wants to be your link to the world of influential and powerful people and it is throwing out a variety of list. we will show you who is on it how -- and how they can help your business growth. scarlet: convincing millenials to buy more wine -- silver oak winery is using technology to attract younger buyers. keep it here. ♪

scarlet: this is the bloomberg market day.

we are going to head over to julie hyman who as a check on how the markets have just seen the rally fade completely. those 1% gains are gone. julie: now it is only .1%. you can see the trajectory -- so much for a big today rally. we may end up with a today rally after the second best day of the year yesterday. for the major averages, we are seeing it away. we are trying to figure out where is the weakness as we look at the pairing of the gains. consumer staples are down, some segments in consumer discretionary's are down and health care is the biggest drag .3%.e major averages, down in terms of the most heavily weighted stocks in the health care that are down most, we have amgen helping lead the declines. looks like we have a bad ticker

there. basis, not that much because they are relatively large companies and they create that drag. a couple of other stocks we're watching include yahoo! an incredible turnaround in these yahoo! shares. yahoo! said it was withdrawing its request from an opinion -- of an opinion from the irs for the tax-free spinoff for alibaba. they have been waiting to hear if the plans for that spinoff were going to indeed work and yahoo! is not saying what it is going to do. a lot of analysts commentary saying this is a short-term negative and creates uncertainty about the spinoff and eventually the company might still go forward and do it. shares fell sharply after hours after the news came out. they are up by nearly 1%. an interesting turn of events. -- daveo hit on a fun 1

and buster's stock up 8.7% after the company raised its forecast for the year after second quarter comparable sales rose 11%. the estimate was for a gain of only 7%. some of the other numbers eating estimates. have you been taking your kids to dave and buster's? scarlet: i try to avoid it at all costs because when she get in there, you can't get out. julie: i guess that's why they are doing so well. scarlet: are you a fan of dave and buster's? pimm: i confess i've never been. let's take a look at some of the top stories crossing the bloomberg right now. proposedean union has the redistribution of 160,000 refugees from the refuge -- from the middle east and north africa. the emergency plan would spread the burden of caring for the refugees.

angela merkel supports the plan but says it does not accomplish enough. --las vegas, a federal state total safety investigators -- federal investigators want to know why a plane suffered engine failure and caught fire before takeoff. passengers escape the emergency chute. at least eight were taken to hospital. scarlet: new york had its hottest day of the year. that's breaking the old record set in 1919. as a result, cost of power in new york has soared almost 150% from last friday. san francisco is pretty good to hit 96 and l.a. is near 100. a little cooler today, but not by too much. pimm: still a lot of people using their air conditioners. scarlet: from supersized smartphones to apple watches, we've had some major launches

over the last year. pimm: what does the company have in store today? we have details coming up. ♪

.carlet: the lines have begun in fact i heard they began yesterday or two days ago. pimm: this is a live shot in san francisco of the bill graham civic auditorium just across from city hall. apple is soon to make it scheduled release of new products, new software and perhaps new methods of paying and using your iphone. i hear that hard touch -- different pressure sensitive glass that will allow you to do more things based on the pressure applied. scarlet: i'm not an early adopter, so i don't know how that works. you are not wearing an apple watch, so you will probably wait for another iteration.

pimm: this is also for the eye don't itself. whether it's paying for something or calling something up by using different pressure points. scarlet: we are going to get more with apple from cory johnson who is waiting out the center. let's move on to some headlines. unveiling his tax plan today as the u.s. congress faces a deadline at the end of the month to pass a budget and avoid a government shutdown. david stockman knows a thing or two about taxes and budgets. scarlet: that's because he was the former office of management and budget director under president reagan. he was asked why congress has voted on a single budget will with just weeks to go before the end of the fiscal year. david: that is par for the course. it's none of the fed's business whether there's a shutdown or not. certainly last time these

guys did this, there was a percentage point cut off growth. andd: it's short term fleeting. the maneuvers happening on capitol hill any weekday or month -- the point is here we are, 80 months into zero interest rates. report friday.s the unemployment rate, as imperfect as it is came in smack dab in the center of the full employment range that the fed has put out. it is in the lowest quintile of unemployment rates in the last 45 years. wordshave been 535 job and less than 100 of them have had it on a women rate of five and one or lower. we are effectively in the end zone in these guys are -- these clowns are debating whether we can let the options rate go above zero.

>> he was with a gentleman called ronald reagan. audienceckee, read our to the key question from mr. stockman. can jeb bush -- michael: jeb bush has come out with a plan to cut corporate tax rate and compress the number of tax bracket to three. sounds like the olden days. david: the greatest tax reform ever was 1986 when reagan cut all the rates across the board. the top rate was 28% but it was on everything, dividends, capital gains and bonuses. fieldas a level playing and over the last 25 years, we have retreated in one direction or another as a result of the lobbies and k street lobby process. i don't think that's likely to

change. the real issue is not whether the corporate rate should be changed or whether we should have fewer brackets for the income tax. what we need is to get a central bank that is under control and allows wall street to does cover prices based on supply and demand. martin disagrees with you. this is a must read -- he says if we raise rates, their grave consequences for the economy. where is he wrong? david: he's been wrong on 25 years. or the last i would not be surprised if a dyed in the wool kenzie and says that. all the banks the world have tactically rates at 04 years now and it has created consequences and distortions. why do you think there is $8 trillion worth of dollar-denominated debt --

tom: have you spoke to mr. trump about formulating stockton like policies? he's shakingeve things up and that's what we need. the republican party has lost its way. you can see donald trump at the republican convention providing leadership to the gop establishment? david: i don't think that's possible. he's way off the deep end on immigration and building a wall at the border and a lot of the ham-handed approach is he is making. but at least he's not republican establishment carrying on with the same old thing. scarlet: that was former omd direct your comment david stockman speaking with the bloomberg radio team. the big reveal in san francisco as apple is scheduled to show off a new iphone and new software. it's all taking place in san francisco today.

scarlet: cory johnson is waiting eagerly for the program to begin. so much of what used to be a surprise is no longer a surprise. what would constitute a surprise today?ark -- surprise cory: if they release an apple scooter or actual apple. i don't think the product focus is what we are excited about. the world to which they are selling has changed. we want to listen for the details about where they are going to release this phone, when they are going to release this phone, if there is a new ipad to go with it. the phone itself has been growing at such a fantastic pace . if you look at year-over-year growth numbers, you've seen a dramatic change with the release of the iphone 6 and ask plus one year ago. they want to extend that growth and they want to continue to be excited about the new phones a

half, but the change to the larger format tones and the change to selling in china led china china andth in that massive acceleration. it has changed apple as a company. the company relies more on the iphone than ever before. in the most recent quarter, the iphone was 65% of sales. that has never been the case at apple -- you have to go all the way back to the early days of macintosh for one product to be responsible for so much of the sales. apple arehone and really one in the same right now and it makes this product announcements so important for apple. pimm: i'm wondering if you could talk about the iphone in the context of how customers acquire it. there are no more of these lengthy contract. there's a battle going on from the carrier point of view. cory: think about what this

means for apple -- the customers in the main market for apple, the u.s. has always been the main market, but all the way back to september, a year ago china was only 14% of sales. u.s. was the dominant market and most of those sales were subsidized. that is to say we buy a $650 phone. at&t was kind enough to subsidize this for me so i got a cheaper deal and that made me more pricing sensitive. i picked the phone i want and not so concerned about the price. in the rest of the world, it is different. the customers pay full price for the phone. apple is selling so much more into china, where china is about a quarter of the sales for the company, about 27% in the most recent quarter. you had it devaluation of the

yuan, so the full purchase price is more expensive to the chinese consumer today than it was even a few weeks ago. the chinese economy has changed, so this announcement is a big deal because they had so much riding on it, more than ever before. more of the company is writing on it, the chinese economy is a more difficult economy writ large and the chinese consumer has less money to spend just because of the yuan to valuation, yet alone the faltering aegon growth -- faltering economic rose in china. i think this is a really big deal, even if the phone isn't exciting because they have to convince chinese can rumors and american consumers not to pay a subsidize costs for the phone, but to pay $650 for these phones. that is a big deal. we're going to see how pricing sensitive customers are. they have to get people excited and they have to do today. scarlet: it is an aspirational

product. i want to go inside the bloomberg terminal. this is the analyst recommendations for apple. it looks busy but the green bar indicates the percentage of by recommendations on the stock. arevery very thin red bars sell. there's a big gap between what analysts see as with the stock should be and where investors have priced the stock at the moment. analyst andk to investors, they remain lish on the company and they say -- they remain bullish on the company because it is trading at a discount. apple has not been the star performer that it was last year. play a don't just skeptic on tv, i'm an actual skeptic on most things.

apple is a template -- is a fabulous company that generates boatloads of free cash, which i think is the ultimate measure of how successful the company is. every product a release is better and better. everything they are doing seems to work, but i think the world is changing and there are increasing risks. i mentioned this on the air when it was dark here earlier this morning -- steve jobs used to release product in the u.s. and add market and supply and demand would dictate. they would build capacity to supply it. that has changed under tim cook. tim cook was the master behind the supply scenes. but in the most recent release for the iphone, they were very quick to go to china in particular, selling that phone after this timeframe announcement last year. the bar is much higher today

even if the analysts don't recognize that. get yourant to thoughts on the ipad, particularly as a business device. cory: what was that? pimm: the apple ipad as a business device -- whether it's something you use to login to your rental car or at a restaurant. cory: we have seen more than six quarters of ipad sales falling and falling again. they have to do something to energize this rant. there's a concern that the rigor format of the iphone has hurt the ipad. pimm: we have to leave it there. thank you very much, cory johnson. coming up, a look at yahoo!. ♪ 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. pimm: this is the bloomberg market day. i'm pimm fox. you are looking at the chart of yahoo!'s stock price since

marissa mayer became the chief executive. we're going to talk more about the company this hour after the company withdraws its application from the internal revenue service for approval on a stock phrase and off on alibaba shares. yahoo! shares right now trading just a little higher in today's market action. let's look at some of the top stories at this hour. republican candidate jeb bush has come out with what he called a simple, fair tax plan. he outlined the proposal in the "wall street journal." taxants to cut personal brackets from seven down to three. the lowest tax rate would be 10%. fallingf mastercard are today. the second-largest payment network in the united states forecast slower growth over the next three years, say it -- saying it will be in the mid- teens.

quicksand. is in the the california surf apparel maker has now for bankruptcy protection. they plan to turn over control to oaktree capital. they have 10 losing too fast fashion retailers like h&m. it is the end of an era at "national geographic." nonprofitn a operations since it was founded in 1888 and will now be a with fox. operation coming up on the bloomberg market day, the united airlines chief executive resigned suddenly. our criminal charges in the future? we will look at the case involving a fright -- involving portght route used by the authority chairman in new jersey.

new iphones and ipads as it holds its annual product release event. it will give you the latest details surrounding the event. turning to linkedin -- it wants to be the place users discover emerging movers and shakers in today's business world. these are 150 professionals, 35 years and under, transforming the digital landscape and the way we do business according to linkedin. joining me now is the executive editor of linkedin. editor joeomberg weisenthal is on the list. what is the reason you are creating these lists? daniel: we have seen some a people show up on linkedin and there are so many people being sought after. we know they are doing interesting things in the business world. we want to combine our data with insights from the editorial

teams to find the 150 people 35 and under who we want members to follow, who they aspire to be like. if we could start identifying them now, we think we could help everyone else figure out where the world is going. thosewill this allow linkedin customers to lincoln with people on this list? daniel: we ended up changing these people to a follow button. you can follow them -- is a one-way thing and as they write and share, you can see what kinds of insight they are giving back professional world, but you don't have to connect with them. pimm: and you can follow their comments. daniel: someone at amazon who button --th the dash i want to follow her.

the editor at a.p. who does robot stories. i want to hear what he has to say but the insurer of journalism. about to hear joe everything he has to say about everything. pimm: i want to play something for you -- warren buffett speaking about the minimum wage to $15 hour or a change to the earned it come tax credit. tell us with the people on the list might have to say about it. more and: if you say the minimum wage is $15 hour, my cleaning lady is not going to have a job. but if we changed the income tax -- you have the income of the arson who made $15 and hour -- that can he accomplished. pimm: the chairman of berkshire hathaway speaking there. what do you think about the minimum wage as a topic? daniel: one of the things we have found is that so many of

them are in the on-demand economy. the idea of finding contract attorneys easily or a guy who .uns the ground checks for uber as the economy moves toward an outsource model, the minimum wage debate starts eating less important or to these people it is less important. they are fighting contractors who will work with them for a short time for a negotiated a. it is a great debate to be having. i'm not going to comment on what warren buffett has to say because he knows way more than i do, but this on-demand economy is the bigger question people are talking about. pimm: are people talking about marissa mayer, yahoo! and these been off of the alibaba shares? so the alibaba shares, but the decision to take

two weeks off for maternity leave. pimm: anybody questioning whether she is capable of running the company? daniel: it's more a question of the message she is sending. pimm: scott galloway i believe is one of your influencers. -- your what he has to say about marissa mayer and yahoo! >> my view, if she hadn't announced she was pregnant with twins, she would be out of the job in excellence. tom: you are willing to say that? scott: i don't think anybody -- she got a reprieve from the throw because she's pregnant with twins. i realize how awful that downs but he going to go down as the most overpaid ceo in history. colleagues -- your comments based on what your

people are saying on linkedin? they arehey feel like not great leaders or haven't seen the future -- you don't people saying this person is keeping this job because they are pregnant or a minority. that's not what the debate is about. the debate is are they doing a good job or are they not doing a good job? i think that was a very provocative statement and a great way to get press around the subject but it is not a debate normal people are having. do you want the list you are creating to be the beginning of a whole group of list? -- whole group of lists? daniel: yes. these are among the million evil writing original content on linkedin, the ones who are clearly standing out. every quarter, you will see us have a regular debut. of 55are you doing a list

and older? list that have a pimm is just a picture of you. pimm: thank you very much. we are going to talk to the chief executive of one of california hospira near winemakers, next. ♪

pimm: this is the bloomberg market day. i'm pimm fox. let's look at some of the top stories crossing the bloomberg right now. intel is ending its longtime sponsorship of a prestigious high school science and math competition. over the years, the talent

search has produced eight nobel prize winners. intel will not they why it is dropping out of the program. the contest is looking for a sponsor. facebook's $2 billion purchase of virtual reality headset maker oculus almost didn't take place. mark zuckerberg says he was less than them rest after his first talks with the chief executive but he came around because he did not want to miss out on the next big computing platform. the discounter has lost out to the luxury jeweler -- a federal judge ruled cosco violated trademark laws when it sold engagement rings labeled tiffany. the problem, tiffany did not make them. costco must pay the jeweler from its earnings and tiffany may seek punitive damages. those are your top stories at the moment. markets are closing in europe, so were the latest, let's go to mark barton in london.

mark: european stocks on the longest winning streak since august. investors have found new optimism that china will be able to stabilize its financial markets and investors swooning from the mess of rise in japan's tk, the biggest -- japan's nikkei. every western european market rising on this occasion. one of the big gainers was the biggestspain, the declining western european stock market and china devalued its currency for weeks ago. the stoxx 600 rebounded 7% the index sunk to an eight month low on august 24. that was when the benchmark gauge had its biggest loss since 2008. let's look at some of the big moving equities across europe. ryanair holdings, europe's against discount carrier lifting

its profit forecast by 25%, joining a number of airlines that recently some -- recently reported strong summer sales. american miners rebounding. stepssm china will take to stabilize its economy. a ftse 100 retail rocher reporting in 18% increase in assets. it justified its premium valuation. let's finish with all the industry groups -- china optimism pushing every single one higher. back to you in new york. pimm: seasoned wine lovers, it a be time to stock up. how is the wine industry attracting the millenials? no one knows this better than

david duncan, the chief executive of silver oak winery and wine aficionado, bloomberg's own matt miller joins us. you have been doing this for 40 years. david: we started in 1972. the winery was cofounded by my father and his winemaking harder. since 2001, it has just been in the duncan family. we have been selling hopefully great wine that will enjoy a lot. matt: people have been calling this the new mondavi. tell us about some of the stuff you are doing. toid: i would be flattered compare us to robert mondavi. making wines about to be enjoyable and to be food friendly.

new era of acceptance and where people get their information about wine is because of social media and the internet. has changed so much from 15 or 20 years ago. we have adopted that and for this next generation, they want their friends opinions, they want the interaction. orm an online perspective just coming to the valley, napa or sonoma, we can touch people and have that effect. pimm: how are you touching people with price points? david: we are at the ultra-premium segment. our cabernet is $70. our napa rally cabernet is $110. it is not inexpensive, but we like to think it is a value. our pinot noir is around $50 a bottle.

the solvent on blanche is about $25 a bottle. the: give me an update on harvest. you have had the drought and you don't want it to rain now. it is going to be 100 degrees in the central valley. degrees. is 100 it's going fast and furious and it's definitely an early season. with the application of technology we have been able to supply in the vineyards, we are able to offset what mother nature does to us. we have our own well and we did get 30 inches of rain in december, so the water tables were full. in terms of growing grapes, it has a fairly normal year. we are little light and early in terms of the drop but making a consistent line is something we have been applying ourselves to 440 years. matt: i know that we drink

collectively as a nation or wine and france, but per capita, we are still underperforming the french as far as wine consumption. pimm: it's not a contest. matt: we only drink a quarter of the wine for capital. -- quarter of the wine per capita. avon: as a nation, the u.s. came the number one consumer of wine, so i think there is a huge growth opportunity. more people are enjoying better wines and more people are interested in wine. even with the whiskey boom and cocktail boom, the enjoyment of wine is part of our culture. of your wine from napa do you sell overseas? david: that's a great question. we've grown from about 4% to almost 10%. there is more interest in american lines overseas.

pimm: where is the big market? david: england is a big market. prices.ll me about land if you want to buy new acreage, you just had your ipl and made a lot of money, what can you expect to pay? 2007 -- howels like do i get into the wind is this chart historically high prices right now. you are going to be looking at $400,000 to $600,000 an acre for a premium planted vineyard for sale for cabernet. pimm: tell us the disposition of your vineyards in terms of the grapes you are growing. david: we own about half the fruit we grow ourselves and half of it comes from rowers. we own properties in napa and

sonoma, up in the anderson valley and always looking for opportunities to have that. you can have the land, make great wine year after year and control the farming and that's important to us right now. going to go after the program and buy a bottle of wine. what should we look for mark david: the current vintage -- pimm: that's the thing about california wine -- it's designed to be consistent year in and year out as opposed to continental line. david: that's right. we get consistent vintages every year. is where i 2010 napa would guide you. we were sharing it last night with some friends and i think you would love it. the truth is we would buy whatever is there. $400,000 to $600,000 an acre or planted lines if you can

buy it. the drought hasn't made it any cheaper. pimm: the chief executive of silver oak winery. coming up, to interviews you're not going to miss -- the zillow and truly it and we will look at the best and worst housing markets. hillary clinton and bernie sanders may grab the headlines, but they are not the only democrats who want to be president. martin o'malley will be our guest on "with all due respect was the beginning at 5:00 p.m. eastern. ♪

pimm: this is the bloomberg of day. it's time for today's option inside. at how thes look major averages are doing.

they have in bouncing between gains and losses over the past few moments and have had a hard time hanging onto gains. it seems as though that is still the case. joining me for today's options inside is jerod wondered. one of the things you are watching is the job openings. these numbers made a big stir this morning because there are so many job openings which seems to presage an increase in wages. how is that affecting our gets? people are talking about it. jared: we have the highest record since 2000 and almost the highest for the u.s. population. it shows despite the market turmoil the summer, despite the lackluster data in some areas,

we are still seeing huge growth and tightness in the labor -- in the labor market. the thing people are coming around to understand is the more openings there are at this price openings get these filled, employers are going to start having to raise wages. is thisf the number dramatic, why haven't wages gone up already? why is there such a lag? jared: a great paper came out of the --n francisco fed called " it's a mouthful. it became a popular paper among several key people at the fed. they have mentioned the key point from this paper which is in a shock like we had in the recession, just like they

were familiar with slack in the labor market in terms of employment, there's slack in the wage market and you have to work through it before you see a tighter relationship between job openings and wages. it has taken a while, but we are starting to get there. it is a four-legged trade? jared: this is a little complicated big issue control. it's called an iron condor. we're selling premiums below the market and above the market to collect some of the rich volatility. risknot an unlimited trade. we're capping the risk by buying further out of the market with puts and calls. around 70 andputs selling calls around 72.

looking three points beyond that to cap your risk. it is because higher wages might be negative for some of these guys. we have to leave it there. really interesting conversation. more bloomberg market day is next. ♪

pimm: good afternoon. it is 9 a.m. and san francisco. matt: welcome to the bloomberg market day. stocks rally around the world but u.s. stocks are struggling. have shares of apple barely budged in the last year, excite a new iphone investors? we will find out. we are live in san francisco ahead of apple's big product event. matt: a corruption probe has

landed just my zach out of a job. will criminal charges becoming next? smisek. good afternoon. this is the bloomberg market day. i'm pimm fox. matt: let's look at the markets and take a look at my terminal here. you can see we are little changed today. if you look at the market toward their -- i'm going to pull up three days of the s&p. forad a big jump yesterday indeed, it was the second biggest gain of the year and that might be one of the reasons we're not think much westoff today. if you made so much money yesterday and this morning we had a positive open, you might

want to sell into that rally. you have gap opens following the holiday. we will see as that progresses. commodity at the complex. down 2%, same going on in europe with brent crude. matt: finally moving in tandem. you see dr. copper -- signals china is indeed using more and more copper. they had august imports rise and after we thought china had fallen through the earth into the core and melted, it seems they're still enough to use some commodities. pimm: still 7% growth. matt: they say 7% growth, but if you buy that, i have a bridge to sell you in brooklyn. pimm: let's take a look at the

bond markets. a little bit of a selloff going on across the bond market. year, a little more selling going on there. let's take a look at how the u.s. dollar is faring. the yen weakening against the dollar, yen weakening against the dollar and the pound sterling weakening against the greenback. europe is being called on to house 160,000 refugees on the middle east and north africa. the european commission president announced an emergency plan that would spread the burden of caring for the refugees. european governments have been fighting over how many they would accept. here is hans nichols. junckeran-claude hunkering down in this speech saying member states of the eu accept their share of 100 6000 refugees currently in italy --

160,000 refugees currently in italy and hungry. nothing about those refugees still in turkey or lebanon. he is doubling down and say refugees should have the right to work from day one, but this will not he and inexpensive proposition. he laid out a new emergency trust fund. the commission is proposing to establish an emergency trust fund starting with 1.8 begin euros from our common financial we want to help create lasting stability by creating employment opportunities and thereby address the root causes of destabilization for displacement and illegal migration. pimm: he did note europe raises

a demographic decline and they need new bodies and new workers. he also said more needs to be done to bolster border defenses for a european-style coast guard. it was not met universally with welcome reaction. namely the eu is forcing member states to accept what is necessary rather than having member states come to the commission and they this is what we can bear. pimm: hans nichols reporting from berlin. matt: puerto rico is facing a huge cash crunch. if new -- it's new economic growth plan shows a $13 billion funding shortfall for debt a month over the next five years after taking into account spending cuts in revenue enhancements. no estimates of potential losses for $72 billion of that. you can take that as maybe the first elbow in negotiations.

citigroup for next more than even chance of a global recession. the banks chief economist says sliding demand from china is the key problem. the analysis puts the odds that worldwide recession in the next couple of years at 55%. maybe that is why we had that they get over the markets in the last few weeks. shares of mastercard are falling. they forecast slower growth over the next years and says growth will be in the mid-teens and operating margin is expected to stay at a minimum of 50%. not a bad operating margin. pimm: coming up in the next half hour, queen elizabeth ii is the longest reigning monarch in history. we will look at her majesty's wealth during her 63 years on

the throne. matt: united airlines offers flat -- offers five lights from newark to london each day, but todiscontinued a flight north carolina that caused jeff smisek to lose his job. we will look at this case it has ties to new jersey governor chris christie. and why you officer scott galloway says marissa mayer would be out of a job is she weren't pregnant. with thespoke bloomberg surveillance team about this issue and dressed why the internal revenue service has refused to give advance approval to a tax free spin off of yahoo!'s stake worth about $23 billion in alibaba. scott: it is very complicated. the rules -- it's not so much

that they are vague, they are aced upon president that they have their own specific context. when they shifted this and what yahoo! was trying to do was put a little bit of an operating is this, it was going to own $23 billion worth of shares and say that was like spinning off a subsidiary. you have to believe that is subject to a lot -- tom: i saw three different interpretations, all good. how does yahoo! respond to not side -- theprivate uncertainty involved here, what does yahoo! you next question mark -- what does it yahoo! do next is to mark enthusiasmn with the as you had a four.

scott: i think marissa mayer is the most overpaid ceo in history. tom: -- >> you have the most trafficked website in the world which you should be able to monetize. it is still the number one portal in the world and has a ton of eyeballs you should be able to turn in to money. but there's a company with the core business in decline and a ceo who has made some of the worst acquisitions in the history of tech, senior-level hires that have caused millions of dollars in some instances -- and this is going to fill up my inbox this morning -- if she hadn't announced she was ringing with twins, she would be out of a job and months. tom: you are willing to say that mark scott: i don't think any board wants to be seen as not leaning in. she got a reprieve from death row because she is in it with twins. i realize how awful the wound down asis going to go

the most overpaid ceo in history. board withis her those bold statements? scott: the board has changed over several times. yahoo! -- the board has in a less than four corporate governance and the gang that can't straight. five and sevenen ceos over the last five years. >> i'm enthralled by this conversation. the statement about marissa mayer being the most overpaid ceo is something your inbox will be overfilled by. where do you think she needs to go with yahoo!? scott: i think it should have been sold a long time ago. it has become an accidental hedge fund rather than focusing on the business of search and being a portal play. it should be sold to microsoft and we should put up a lead in

the head of this story called yahoo! later, whether it's a stockholder who receives the shares or whether it is yahoo!, someone is owing to pay taxes on it. -- someone is going to pay taxes on it. the value of this been is that it gives underlying investors the choice of whether or not to sell the stock. are waiting on the spin? >> there is going to be a tax to pay. that was earlier today on bloomberg television. yahoo! shares are up about $.62 right now. still ahead on the bloomberg market day -- is housing making a comeback or are we just in another double? coming up at 2:00 p.m. eastern, we have that and more for the zillow chief executive.

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pimm: this is the bloomberg market day. i'm pimm fox. matt: i'm matt miller. let's get a check on the markets with julie hyman. she is looking at what slight gains we are seeing after a big yet open. julie: a big gap open with all the major averages up over 1%. it was just sort of it did not sustain it self. we have the second-biggest gains for stocks this year but could not he sustained. i want to point out some individual movers where we do have catalysts.

this is a producer of liquid national -- liquid natural gas. jim chain as says he is shorting this company, saying liquefied natural gas is a looming disaster and demand is not growing. this puts him on the other side of the trade of some prominent names. , has anhn, most notably 8% stake in the company. he has been in talks to an act some changes but he is not alone. there is a lot of hedge fund ownership of this company. i will go through some of this for you -- carl icahn the largest holder here with that 8% stake. investors, point stake investors -- a lot of ownership on the other side of that trade rum jim chain nose. we will see how it turns out.

he hass had mentioned been shorting solar city. beens have not just declining today but we have seen shares declining over the longer term as we see the price of oil drop and solar looks less attractive. shares down 4% today. one of its founders is elon musk. on that front, i wanted to look at tesla. 1.5% after aer by couple of analyst calls. company says it is a transformative battery-powered company, analysts saying if you look aside from the obvious proposition, it a carmaker, what else does it do? the company has numerous near

turn opportunities. as i look at these three companies, it occurred to me who else is short these companies because some of these have relatively high short interest. 10% which shows jim chain as doesn't have much company on his side of the equation. in a case of tesla, it's about 25% of flows. quite a words, that's crowded short as a percentage of flow. matt: you would rather be one of the first ones in. if it's a crowded short, there's too much of a cushion and every time it comes down, it goes back up. thank you, julie. pimm: let's turn to some of the top stories at this hour. lockheed martin is cutting 500 job. the defense contractor says it's

because of a ship in government priority. tiny fraction of the lucky work forced. -- lockheed workforce. matt: people are blasting their air-conditioners -- the cost of power in the new york market surged almost 150% from last friday. pimm: and it is the end of an era at "national geographic." it has been a nonprofit and's its founding in 1988 and now it will be a for-profit operation with rupert murdoch postulated century fox. it also includes the national geographic cable channel. that's a look at our top stories this hour. coming up, queen elizabeth the second, the longest reigning monarch in british history. how much royal

highness is worth. ♪

matt: a gorgeous shot of the bay bridge in san francisco on this wednesday, a shortened trading week. i'm matt miller. pimm: and i'm pimm fox. queen elizabeth the second is the longest reigning monarch in british history. while she has ruled over and and resident of time of wealth creation in her country, her own royal fortunes are maybe not so great. matt: here now to build a crown jewels is tom mcgrath -- tom met cap with us from san francisco. tcalf. me

part of this is she has lost her own wealth and land. the rise of seen billionaire entrepreneurs and oil sheiks. and this has largely been inherited the family and has stagnated. we calculate her fortune is about $425 million. but when you compare that against the world's richest people today, that's a fraction compared to when she ascended to the throne in 1952. matt: can you provide us with details of the analysis based on asset classes? tom: this is a classic example of someone who is asset rich but cash poor.

we calculate yes has about $425 million, with $170 million in assets which she inherited from her mother. that stuff like average a eggs and furniture in the houses. she has a couple of houses -- i think she is the world's most valuable stamp collection. plus $10 million worth of horses and an investment portfolio calculated around the $75 million mark. matt: i don't inc. a lot of people in the u.s. get how the monarchy works. queen elizabeth roman to -- queen elizabeth ii is the queen by divine intervention of god. how does she not own a portion of the island? buckinghamves in palace, which is worth about $3

billion but there's a clear distinction between the monarchy and then the queen as an individual and her personal fortune and what she's able to pass on to her family. matt: isn't there an agreement the monarchy has signed with we will rule over these assets that you can own them in exchange for an annual allowance? : exactly. it's called the sovereign grant. predecessors a few hundred years ago ava the crown assets, which is the buckingham palace and they get about an percent of all the profits from those assets. incometty much all that goes to running the monarchy. , so shea huge payroll

gets about 40 million pounds the year from this profit sharing, but that goes straight out the door every year. some people say maybe it's not even enough. collectionoyal stamp is something you mentioned and it has been handed down from her father and grandfather. i wonder if you can tell us about that. tom cole and it has all sorts of oddities and interest. with a valuetamps , and they sold for about 13,000 pounds. her father and grandfather were very keen stamp your's and built that the collection which i believe has a copy of every single british stamp. not that much of a

fan and has not added to the collection during her tenure. pimm: they issued a special stamp in britain to them her years on the throne in herbal. that was for the diamond jubilee in 2012 and today, when she becomes the longest reigning monarch. as of today, 63 years and 216 days, so she is just overtaken queen victoria. matt: she is popular, but what about the monarchy itself? with the likelihood this survives a few generations? tom: it is in rude health. about 16% of rich people like the monarchy and wanted to stay. -- she has seen the dissolution of the british empire, princess diana and family strife -- the queen has

been a steady hand over these last decades. pimm: thank you very much. i will turn it over to you. , we will talkp about apple getting ready to unveil its latest product. ♪

matt: welcome back to the bloomberg market day. i'm matt miller. let's get a look at the stocks and the stories making headlines at this hour. happening live -- donald trump and ted cruz are headlining and out -- headlining a rally against the run nuclear agreement. ofbeing held on the steps the capital just days before congress is scheduled to vote on the deal. you are looking at the capital aroundith the structure the dome as they do they multi--year repair.

we are also hearing that congressional republicans will be meeting at 4:00 p.m. to discuss their next steps as far as the iran deal. we will bring you that as it unfolds. hillary clinton says the iran nuclear deal isn't perfect but she calls it a strong agreement. former secretary of state discussed the plan during a speech this morning at the brookings in tuition and says the time to stop iran from building atomic weapons is now. clinton: either we move forward on the path of diplomacy and sees his chance to lock the path to a nuclear weapon or we turned down a more dangerous far lessding to a certain and riskier future. that is why i support this deal. i supported as part of a larger strategy toward iran. matt: passage of the plan is assured even though a congressional vote rejecting it

is likely. senators whoe 42 favor the deal, enough to support president obama if he vetoes any resolution. netflix is expanding in asia. they will offer stringing -- streaming video in asia next year. they began service in japan and plans to complete a global expansion by the end of 2016, which is good because competition is ramping up everywhere. cutbacks are on the way as the nation's largest department store chain will close as many as 40 underperforming stores next year. experimenting with low-priced outlets and wants to improve the company's online sales figures. toyota unveiled its redesigned prius in las vegas. a lower hood and sharp creases surrounding a rear spoiler and fuel economy has been improved. the new areas gets about 55

miles to the gallon and one will come soon with 60. next half houre -- after a dramatic off-season, the nfl begins its regular season tomorrow night and -- can the league continue its ratings dominance? dueling speeches in washington makeesidential candidates their cases for and against the iran deal. and in less than 30 minutes from now, the most important event of the day, the month, maybe of the year -- apple holds its annual event in the where it is expected to announce the launch of a new iphone. the company may also release and of eight to its apple tv set-top box, which serves as a way to streaming content from netflix and other providers. it has been three years since

apple was up dated. it is now a crowded market with roku and many others offering access to similar content. john butler joins me now. we are going to talk about the tv product. i'm a big user of this but lately, i've started using my xbox because i can talk to it. i don't need to use a remote and i can access all of the content except for itunes. john: you are getting an upgrade here. the greatest thing we hope to get, we don't have details yet but we are going to see a big upgrade in processing power. and they're putting i was nine on the box. nine onare putting ios the box. it's all in advance of launching this new apple video streaming service.

have an installed base of hardware to really succeed. market they want to hit with something appealing. i think you may get your money's worth. matt: the current offering is cheap as chips as it is. this is going to offer more than the boxwer that was a minicomputer you hooked up to your tv. tv they come out with, they add a number to it. a5 current box has an processor and the rumor is it's going to a nine, which is a big leap in processing power, which is great news because all the apps out there have kept pace with the processing power.

canne with an old computer tell you it's frustrating to use an old processor in modern apps. matt: i feel like i'm one of the few people who has this. is this something we don't talk about that often? do a lot of people have them at home? it test byld put saying tim cook has always called it a hobby. it has not been a hit product for apple. flash apps onn your screen like amazon or netflix, but it can mirror your computer on the screen. it's a neat trick, but it has to go well the on that. that,s upgrade of probably the memory as well as the ios nine is going to bring

it into a whole generation. it's a neat parlor trick -- taking your computer and putting it on the tv wirelessly to being a computer hooked up to your television screen. a lot of the units that ship -- i just not -- i don't remove or what brand, some giant new flatscreen. it does almost everything my apple tv does. videos,tch amazon prime it has screen mirroring, so they have to do something good to win in this highly crowded space. the secret is going to be in the remote. there are certain aspects that will make gaming a lot easier. notnot a gamer, so i'm going to attempt to remember what that is. withan drive the remote

siri which is the killer app there because we are talking about a $150 device. you are not raking the bank trying it. if you are a big apple user and maybe down the road have plans on subscribing to apple video, i think it is $150 well spent. the iphone, i feel like everyone is prepared to be underwhelmed. numberused to the s coming after the original number. what can they possibly do to make my iphone 6 better than it already is? thingthere is one killer they are doing which they are upgrading the camera, i believe from it eight megapixel to 12. they are still not even close to samsung at the scene, but the camera for the iphone has been a weak point. most people today take pictures

on their smart phone. matt: i use my iphone all the time and i have never felt deficient and only having eight megapixels, but i'm old enough to remember one megapixel cameras. john: start blowing up your pictures and you will see a difference. matt: the chance we will get a retina screen? john: i don't think we are going to get it because you would have heard rumors out of these higher community -- out of the supplier community. i do think we are going to get a processor and after iphones were bending in people's back pockets, think will get a stronger aluminum body. rumor -- ird a bad want to make this clear -- i don't think this will happen -- but someone said i heard they're putting out a flexible iphone. that's probably unlikely.

john: people are worried about iphone and its growth trajectory. i tell people that they still have runway on the iphone in terms of feature enhancements and a flex screen and flex phone in the future is not out of the question. and -- is an iphone many .phone mini there's a lot they can still do despite moving to the better camera and despite moving to the better processor. you will have force touch. doesn't get me excited. i have it on other devices. i have it on the new mini macbook and other things. let me take a look at the stock. i have it up on my screen. this is a one year chart. we are still up about 15% where we were 12 months ago, but it

has been a rough couple of months for apple. they've gone down from 135 two basically 110. john: i have your answer. i don't know if this will help or not -- it won't hurt. what has hurt apple has been the iphone, 25% of iphone sales come out of china. in general, people are worried about the size of that business. it's close to 70% of sales for apple. anything that could dent growth there gets people worried. if you look at consistent -- if you look at consensus estimates, we are going to 5% growth estimates for next year and five are sent for physical 17. i think that's what the street may be reacting to. and china. but you have all of these great

new products from apple pay to apple watch to apple music, potentially apple video. take all of those together and i think within two years, it may have the potential to pick up any slack we're going to see in the iphone business. at least that is the hope. in theu.s. -- matt: u.s., people ask how long is it going to take before i can buy my new iphone? john: i always tell people to think to or three weeks. it could be right away. matt: senior analyst at bloomberg intelligence. still ahead, it was a shocker out of chicago as united eeo jeff smisek and other high-ranking ceos resign. this as a federal corruption probe heats up.

will there be any ill effects on the airline to mark a with us for the answer. ♪

matt: welcome back to the bloomberg market a. i want to get straight to julie hyman for the big stories so far. julie: it has been this volatility -- out of the gate, we were up about 1% and then dropped briefly to negative and we have been hovering about a .1% increase. it looks like we are gaining ground again. this new volatility that has returned to the market is here to stay and is happening on an intraday basis. bloombergk at my terminal 2 see where we are in terms of the landscape of the sectors in the s&p 500.

consumer discretionary is the best-performing groups. and consumer staples are the lagging groups within the s&p 500. technology in terms of the best performers are tech stocks and large cap tech stocks to boot. facebook up 2% and apple up about .6% as we await the company's presentation. netflix is on the rise. these large-cap tech companies performing well. comeback in overall markets, i want to point out that once again, we see volume that is down. this is the function that shows the volume by sector. matt claims i ripped this one off from him. all of these bars are going down. health care volume down 25%.

thisher words, as we see wishy-washy day, there's not a lot of on the volume side. thewhere, i want to look at 10 year note which we have seen rise to its highest in almost a month in terms of its field. we are seeing more of a decided move as we get closer to the fed meeting. on the commodities front, some weakness there. gold and crude both trading lower. the weekly surprise -- weekly supplies report coming out tomorrow on this shortened week and gold futures having their biggest klein in about two weeks. biggest decline in about two weeks. matt: now i know you got the function from orlando and i got

it from curtis, so we both have our own terminal gurus. united airlines has announced ceo jeff smisek and two other executives were ousted yesterday . he will be replaced by oscar munoz. exit long do even before this investigation was announced? joining me to discuss it is mark crumpton, who is not only going to coanchor for me for the next half hour, but also from new jersey. mark: ousted is probably a tame word for what happened yesterday. kickedre unceremoniously out because according to our andy on bloomberg.com -- bloomberg has been on this story since april, we should point out. there was a dinner that involved mr. smisek and mr. sampson, who is the head of the port authority of new york and new jersey.

sampson,ation is mr. who has a vacation home in columbia, south carolina, wanted a route fix so he and mrs. sampson, it would make it easier for them to go on vacation to columbia. this is one of the things that was discussed and the route eventually came to pass. they called it the chairman's rout. of thee was heart investigation trying to determine whether there were any part of the investigation was trying to determine whether there were any favors. because he was a mentor to chris christie and there is the tie. now this goes back to him being a state attorney general and the former chairman of the port -newority of new york jersey. this has some tentacles we haven't even seen yet. what i find interesting --

i can't remember if it's the fbi or department of justice -- new jersey and illinois are literally the most corrupt state in the united states. this scandal and twines both. united has its headquarters in soncago and christie and sam are based in new jersey. what is it about the state you live -- mark: how did i know you are going to say that? aree are in -- these allegations and the investigation is ongoing. matt: i have been hearing from a lot of people, what's the big deal if they made a new route for the guy westermann what if they were selling other tickets to mark it's not as if he's the only person on this 50 seat executive jet. mark: guess prices, union workers at the other airport. even more hours. is it a loss for anybody?

mark: you and i both know that is not the point. united was the recipient of millions of dollars from the new jersey transit authority. upgradesy needed some to their terminal at newark airport. was this a quid pro quo? that's what investigators are trying to find out. but we will have more on this story coming up in about 10 minutes. we will speak to a couple of our reporters and try to get to the bottom of this. i'm just going to say this -- we did not do it justice in about two and a half minutes but i'm sure they will because they have been all over this tory. -- all over this story. up, apple plus event starts at the top of the hour. we will bring you the latest on the new iphone and maybe a new apple tv. who knows what we are going to get, but you are all going to

want to know, so definitely stay tuned to bloomberg television. ♪

matt: welcome back to the bloomberg market a. i matt miller. we want to look at the european market close. let's go to mark arden in london. this investors have found new opportunism that china will be able to stabilize its financial markets and investors are swooning from the massive .ise in japan's nikkei the biggest increase in seven years. every single western european market rising on this session, every industry group rising on the stocks 600. one of the a guest gainers was the ibex in spain. it's the biggest inclining western european stock markets and china devalued its currency roughly four weeks ago. the stocks hundred rebounded 7% index slumped to an eight month

low. you will remember that day -- the benchmark gauge had its just lost since 2008. let's look at some of the big moving equities. isnair holdings, europe's discount carrier lifting its profit forecast by 25%, joining a number of airlines that reported strong summer sales. gain toany bringing its 11% on optimism china will take steps to stabilize its economy. 100 retail broker reported an 18% increase in assets. it justifies a significant premium valuation. let's the niche with all the

industry groups -- china optimism pushing every single one higher. back to you in new york. a little bit of green in europe, but a lot of green and asia. volume in china's futures indexes plunging 99% from their june highs. last month, they were ranked by the world federation of exchanges as the index inost active futures. the following futures volumes could cause even greater damage than the equity route because of the part they played in the investment strategies of hedge funds and institutions. analysts say if italy or to revive the futures market could undercut the government's own efforts to prop up stability. matt: here in the u.s., we have

little change on the dow and. the nasdaq is gaining and apple is about to kick off its big event. stay tuned and see what new toys you are going to want to buy. ♪

it is 1:00 p.m. in new york and 1:00 a.m. in hong kong. this is the bloomberg market day. u.s. stocks fluctuate between gains and losses after japan passes in a k posted its best sn years. donald trump and ted cruz lead a rally. ♪

matt: good afternoon. i am matt miller. thank you for staying with us. mark: the major averages are fluctuating after an early rally. at the boards, we can see a negligible gain for the s&p and the dow industrials. the nasdaq composite is up just about .25%. for a secondlling day, falling below the 22 level. it is now 2372. events is down four and three quarters percent. also lower for a third straight day, just over 2%, 4294. 4838. one futures, gold is down

and three quarters percent this afternoon. matt: interesting to see commodities fall and bonds are selling off and equities have a green arrow. look at currencies. the dollar is gaining again. the euro gaining against the pound. you see the dollar strength, which clearly works well with commodity weakness. ec equity gains, and that has not been the theme in the last few weeks. those two does have been positively correlated. now, at this hour, the migrant prices in europe. a key leader says there is a lack of union in the european union. the head of the european commission today urged member nations to find a solution by next week. every eu nation must take in some of the 160,000 refugees are also merkel agrees quick action is needed.

>> we need a binding agreement among all member states. it cannot stay the way it is now paired it would be a step forward if we could achieve what is being proposed today. migrants are pouring into hungary, italy, and greece. the refugee crisis is europe's worst -- tonese premier trying concerns about the valuation of the u.n.. lee says he wants to avoid a currency war and that his country's slowing economy is operating at a reasonable range despite downward pressure. he made his remarks today at the world economic forum summer host meeting in china. mark: hillary clinton says the iran nuclear deal is not perfect that calls it a strong agreement. the plan was discussed during a speech this morning at the

brookings institution. to stop iran from building atomic weapons, the time is now. ms. clinton: either we move forward and sees this chance to block iran's path to a nuclear weapon, or we turn down a more dangerous path leading to a far less certain and riskier future. support the deal. i support it as part of a larger strategy toward iran. passage of the plan is a short though a vote rejecting it is likely here it democrats have 42 senators who favor the deal, obama.to back president a huge cash crunch video economic growth plan shows a $13 million ending shortfall for debt payments over the next five years. that is after taking into account spending cuts and revenue enhanced in spirit there

were no estimates of potential losses for holders of puerto rico'$72 billion of debt. mcdonald's is planning a switch to cage free eggs over the next decade, the latest move by the ceo to reinvest the struggling fast food chain. the company announced plans to use mostly antibiotics re-desk free chickens. chickens.tics free matt: the department store chain macy's is planning to close as many as 40 underperforming stores early next year. the ceo is experimenting with lower-priced outlets and wants to improve the company's online sales figures. colorado's high taxes on getting high are going away for a day. those buying recreational marijuana stay will not be taxed. there is usually a 15% exxon tax and a 10% sales tax. they will save about $20 on a

one ounce purchase on that day. that is a look at top stories for all of you, it's actually for those of you in colorado. mark: coming up in the next half hour, yahoo! was dealt a major setback. the internal revenue service refused to give advance approval for the land to's and off its alibaba stake tax-free. why cofounderhear jeff good luck says any crude prices will likely be short-lived coming up. apple's latest event is officially underway in san francisco as tim cook takes the stage. mark: the company's widely expected to announce iphones and possibly a new ipad. the new apple watch. cory johnson is there.

what are you hearing so far? >> somewhere behind me, tim cook is standing on a stage saying, the monster announcements are about to happen. says 97 percent of the apple watch users are satisfied with perhaps it here it is just very small. i think the size of the announcement for the monstrosity really does depend on the viewpoint. we are expecting minor updates of the apple iphone six and six plus. we are expecting an update of apple tv. maybe we'll see some new bands for the watch. maybe there will be surprises. we're waiting to see. think of au could monstrous surprise within the realm of possibility, what would it be?

>> godzilla walking over the corner. what the bigout paradigm is right now. smartphone sales across the world are slowing dramatically. predicting closer to 10% growth this year. sales in china are dramatically .hrinking in terms of growth it has got to be something that could cite not just the global market but particularly the chinese market, which seems to be slowing in all at next -- all assets. smartphone growth in china is dramatically slowing. let apple not just gain share from a shrinking samsung but also getting consumers excited sore in a market embracing much difficulty. matt: i think you're misunderstanding the question. have you heard of anything

totally awesome that you think is unlikely but that we might see? >> i have not. there is a possibility of maybe new watches. actually shipping some new products. maybe that would be a big thing. i think they have done quite well. the 70% satisfaction thing, we will give whatever he wants for that one. the business has grown pretty well. an important news cases, demonstrations of what he can do that you could not before. i would be very helpful for apple. mark: cory johnson joining us live from san francisco. throughout. more matt: he is not really selling this. mark: considering he is a journalist, he is not supposed to. the ceo is out late yesterday

afternoon, united announced they dismissed because of a federal investigation to whether he arranged for united and columbia as a favor. matt: the story that sells itself. you take comfort in him not being fired simply because he was at his job, do not even be on the investigations, it was struggling, and covering the here, both arey, joining us now. mary, why don't i start with you. and we will ask the obvious question it are people looking into bribery here? is that what the allegation would be? chairman of the new jersey transportation with thing like -- things like flight routes in order to get money for this project? -- >> it is not

entirely clear. you have to consider the fact that not only did united potentially have these flights, possibly getting involved to get some things that benefited united continental. be anotherseems to facet to the spirit according to your reporting, he was having some problems even before the investigation. >> the past several years as trying to put these together. he decided to go with united instead. together inteel 2010. it has been a rocky transition and they have had a lot of operational troubles in i.t.,

some maintenance issues the summer. it has been a troubled merger and executives were ready to conceive -- concede that point. there was a hack. there have been issues that united and it goes beyond whatever happened at port authority. about the to us dinner that took place in manhattan. you write about it in your story, the discussions about what became known as the chairman's rout allegedly took voice. bloomberg the story first broke back in april. the former port authority chairman actually to -- flew out and said, hey, would you think about starting this route question mark it would put him closer to a weekend getaway in a vacation home he had off carolina. united continental holdings that run this route prior to this and

discontinued in 2009 because it was not profitable. initially, they said they would not do it as it is not profitable. they later decided to start the fight and ran it from 2012 to just after sampson left in 2014. matt: we can gather from that that it still was not a profitable route. even later on. we do know that airlines occasionally run profitable routes in order to serve the customer base. it is part of what they get in exchange for basically having this monopoly on u.s. air travel. >> there are reasons airlines would do a route. sure. industry, things need to be profitable or you do not continue. the fact that this fight and it very quickly after it was gone, i think that tells a lot to

federal prosecutors and people looking at this. mark: what do we know about the man chosen to succeed him? the president and ceo -- and coo, he was on the board at united continental and he had a great reputation. and its are very happy is because primarily, he is involved in helping in a turnaround. streamlining, making them profitable. they feel like he has the knowledge to take united continental. matt: you cannot do this kind of thing alone. parity thinksign the company has gotten rid of everybody who may have been involved with this? hard to say. there were definitely people at the dinner yesterday. it could be a case where united is trying to get ahead of

whatever they are talking about federal prosecutors. matt: do you expect more expulsions from united? yesterday that it is continuing and the federal investigation is continuing. that is all -- always a possibility. mark: all right. mary joins us from dallas and justin here in new york. little more on this story, it is on bloomberg.com. this is just fascinating. this story has come it seems like a soap opera. matt: it has got all of the dramatic elements you could hope for in a story. thesee credit goes to fine reporters. still ahead, apple's product event started with tim cook. he's already onstage talking about the watch. presidentsenior vice

commenting on gopro and the watch app. we will have more on this with bloomberg television. wey johnson is outside or will be checking in with him. a market day continues in a moment. ♪

matt: welcome back. just got apple event underway. tim cook kicked it off by saying we should expect monster announcements. matt: here is what he had to say about the apple watch. watchple love using apple . customer satisfaction is an incredible 97%. [applause] just begunhave

speaking about the ipad. more highlights on apple's's big event as they come. other stocks are making moves today. a look at the markets right now. good afternoon. >> thank you very much. markets fell briefly before noon. they saints -- they since pulled back up. the down the s&p are higher than in the sessions. the dow jumped as much as 172 points earlier in the day. the s&p 500 is up by a quarter of a percent. the nasdaq is up the most by about .5% right there. looking at individual stocks, let's check out netflix. from worst to first. the worst s&p performer yesterday leading to gains today. shares are trading near session highs and up by more 5.5 percent. losing streak.

and it doesortunity not think apple will enter the content business. above its 100 day moving average. big -- a bit technical. shares are there for a second straight day off the highs of the session. today gain since july 1. the stock is up by little more than 2.5%, the highest since august 26. it turns out securities also initiated fitbit with an outperforming rating and a $50 which came after

morgan stanley update the stock to overweight yesterday. finally, tesla is also higher today, up by about 1.3 percent, extending off its 2% gain yesterday. and then outperform with the $340 price target. back to you. matt: some of the stock stories making the news this hour, if there were any other news than apple, that would be it. mark: shooting to highs off the announcements thus far. matt: a larger ipad pro. also, facebook messenger would be available on the apple watch as well as gopro apps that we just told you about. there is a lot coming out of san francisco. stay tuned to bloomberg television for all those headlines. ♪

matt: welcome back. we are listening in on apple's's big event that just got underway. discussing the new ipad, the new ipad pro. a model they used previously with macbook. -- we'll bring you the new highlights and check in with cory johnson standing live outside the event. he is hopefully talking to someone inside and not just standing outside the building. harsh words former is a meyer today. bloombergoway joined tv earlier and called her one of the most overpaid ceo's in history. down yahoo! shares are since may and investors are becoming increasingly doubtful the company will be able to exit its alibaba stake without a whopping multibillion-dollar tax bill. here now to suss out how much trouble yahoo! could bring in is richard in d.c.

he unloaded on marissa mayer. what is going on with the company now? >> the big issue is still the same one that has been there for months. they have a big stake in alibaba and they want to get rid of it but they bought it a lot cheaper than it is worth now. they have got to find a clever way to dispose of it. they have tried to spin off yahoo!'s small business. a tax-free transaction is what they asked for and the irs said will not give you that. matt: that is not the only issues got brought up. he said she spent way to much on acquisitions, they do not make any sense. over $100ses come million hiring senior executives that end up splitting in a short order. and that she personally is overpaid. i think he said she would get a quarter of a billion dollars.

to shareholders not express concern? so sure about that. i think a lot of times you hear that and you have to look at the core of the deal that they are trying to do. you see shareholders and analysts taking opposing views on whether they can a copper's this thing. if they can find a way to get it done, it might go a long way to resolving some of the concerns they might have. this is something that, we have seen reflecting in the share prices for the last few months, it is down 30%. joining usrd rubin from washington. thank you so much. matt: i will leave. i will watch the apple -- i'm excited.

mark: apple, apple, apple third we will preview to the event live next with cory johnson. ceo tim cook discussing the ipad pro. ship,s pro has a new desktop performance. we will get more when bloomberg market day continues in just a moment. ♪

mark: welcome back. i am mark crumpton in new york. thank you for staying with us. top stories crossing the bloomberg terminal at this hour. hillary clinton is changing course on the controversy over her private e-mail server. the democratic residential hopeful has resisted apologizing for using private e-mail as secretary of state. it all changed yesterday in an interview with abc news. back atton: as i look it now, even though was allowed, --hould've used to accounts

two accounts. that is a mistake and i'm sorry about that and i take responsibility. i am trying to be as transparent as i possibly can. several polls show the majority of americans do not find clinton honest or trustworthy. a house hearing on planned parenthood is underway in this hour. critics say the organization's handling of fetus tissue file its federal law spirit republicans want to cut its funding. that could be a sticking point in budget talks. he doesn't spending bills are needed by october 1 to keep gudgeon death government agencies over -- open. debuted on cbs last night as himself on the late show. stephen colbert: thank you for all joining me. i am me. you are all witnessing television history. like most history, it is not on

the history channel. mark: colbert takes over the hostsnd david letterman i -- hosted. andbush, george clooney, jon stewart. plenty of donald trump quotes. of your topme stories at this hour. the apple events going on right now in san francisco, here is what ceo tim cook just said about the new ipad. tim cook: this is the ipad pro. [applause] most capable and powerful ipad we have ever created. it is chock full of amazing and technology -- advanced technologies. mark: with the latest, cory, i promise i will not abuse you

like matt miller did but tell us what you know so far. >> you can abuse me like no one else. event, henced at this saw the ipad pro. it interestingly borrows a lot of innovations from the microsoft surface. it has got a keyboard if you want. pad.pple it is a bigger ipad. top-of-the-line up until today. the height of the ipad air is the width of the ipad pro. it., it has a new chip in is 1.8 times faster. it is significantly faster than the last chip here it is thinner . also announcing minor tweaks, introducing new colors,

aluminum, rose gold, sort of a red or gold color, and emphasis on the cheaper models out there. and new band, including a band from -- should you choose to wrap your wrist in leather with a watch. if you choose to wrap your wrist isleather otherwise, it certainly a choice one can make especially here in this great city of san francisco. calling monster announcements, the things we expected from apple, important things that they needed to do to extend these rants and get people buying. three quarters of declining sales. of the side from all things we are hearing out of apple, what do you think investors want to hear from tim cook today? : one thing to us and four

is not just where the products are but where they will be released. will they launch the new watches globally or will they just start in the u.s., suggesting they have got supply issues? helping investors understand what this might mean for q4 sales in september. the release dates are important. they said the new software would be available starting september 19 globally. the new watch is available today in apple stores are rollout dates are important. rollout geography is important. the analyst can start to pencil out, they have got these new products, times whatever. that actually might give you your actual projections for sale. despite the pullback in the chinese economy, analysts expect a 23% growth rate, a little slower.

they have raised estimates since july of apple sales we will be looking for reasons for that area -- for that. quickly.ave to ask you tim cook has been doing this for a couple of years now. he -- is he now owning the event the way steve jobs used to? cory: i do not think anyone can own an event like steve jobs did. this is tim cook's company. he has mastered the supply and demand parts of the company. saying, i amer was not selling it appeared i am not a salesman. tim cook is a salesman. p juste the salespeople salespeople. they are the salespeople. mark: thank you.

we will continue to bring you headlines on this event throughout the hour. let's turn to politics. jeb bush speaking out about a topic important to the republican party, tax reform. he is expected to unveil a proposal shortly. he will be making that message on a campaign stop in north carolina. his plan in an op-ed in the wall street journal, saying it will eliminate loopholes and that will deal 4% economic growth. phil mattingly joins me now from washington with more on this developing story. given mr. bush's's standings in the polls, can he sell this? >> israel policy, and that is what his team is looking for to get out there. it is not just using talking points are using inflammatory pollack text. this is real policy. if you talk on the republican and democratic side, there is a knowledge meant the plan, we

have got a few preview details of it last night. early this morning. it is real and when you look at the details, you recognize why. it is not just traditional republican orthodoxy, though you mentioned he made very clear to try to compare this to 1986 and another resident republicans like to talk about quite a little bit, ronald reagan in that he made clear cutting the individual rates, eliminating tax loopholes, and slashing the corporate tax rate although it down to 20% would be central components of his plan. details, which matter at this point, right now, it seems a lot more that the inflammatory comments are what are actually catching flat -- catching fire on the campaign trail. he will need to get out there and sell it if this is going to work. mark: is this a blueprint of what mr. bush did when he was governor of florida? >> he is trying to use his time

as an example of the expansion of the tax plan, which he is pursuing here, was effective there and it will be effective. one interesting component, there are elements of this very similar to what mitt romney put out there in 2012. i have seen the cap individual rate at 28%, very similar. isever, governor bush messaging this in a different way and there are elements of the proposal that are different. toy are attacking what used be untouchable, the carried interest loophole as well. he is actually bragging in that editorial he is pushing 15 income people off of the tax rolls. it has been the earned income tax credit. not just cutting taxes for the rich, but trying to expand this in a broader level in the op-ed we are talking about, the highest will return where it was

his monumental and successful tax reform. citing ronald reagan but also trying to broaden out a little bit here. interesting, the former florida governor was one of stephen colbert's first guests last night when mr. colbert debuted. scathingot call it a criticism, but he did criticize george w. bush, for his spending habits during the second term in office. >> that is right here you has been asked repeatedly what are the differences between george w. bush and you if you were president. the one he seems to have settled on, he makes very clear. thebush: i think republicans are spending way too much. our brand is limited government. you can take care of the people who need to be at the front of the line, that disabled and people struggling. that is a core value of our party. but we should not spend so much money on everything else. >> one of the sharpest pieces of

criticism that the new era of conservatives have had of the george w. bush administration was his inability to control spending, appropriated entirely by congress. that has been the issue jeb bush has seized on as the key difference he is willing to point out and settle on when he is asked about the difference between his brother's administration and what he would bring to the table. you will hear from him over and over again. what they think kind of sets the tone for a different bush administration should there be one starting january 2017. mark: phil mattingly joining us from washington. thank you very much. sticking with gop presidential hopefuls, donald trump is having an anti-iran nuclear deal rally at the u.s. capitol. he and the former texas senator ted cruz, they are joining forces together, trying to get people to contact members of congress to reject the deal.

the deal was eventually established by the united states in five of the world powers to curb iran's nuclear ambitions p or we will bring you the latest headlines from the rally and are following apple's live event from san francisco. mr. trump: all of these countries are going to do business with iran or they will make lots of money and lots of other things. ♪

mark: welcome back. we are listening in on apple's's big annual september event underway in san francisco. the company just unveiled the new ipad that comes with an apple pencil along with a smart keyboard and we will continue to bring you all the highlights and we will check in with cory johnson coming up.

let's get straight to a check of the markets right now. r is standing by in the newsroom. emyr volatility back in the markets today. y: back with a vengeance. we saw the major indexes start with a bang this morning. back into the green, and this is where we are now. the dow jumps 172 points at its session high. 64 points. is down the s&p 500 is down one third of 1% per the nasdaq is nominally down. imap function. this is a snapshot of the sectors. you can see here not one sector is in the green and this just changed in the past minutes. telekom had been leading with modest gains. all these sectors with energy, the biggest loser is down by more than 1% thanks to oil as low as gas equipment services.

to commodities and oil is down for a third day in a row. estimates u.s. inventories probably climbed by 500 barrels last week according to a bloomberg survey. at the report tomorrow per nymex crude is down 2.5%. looking at gold, the safe haven, down by 1.5%. this is the biggest drop since july 20. take a look at treasuries. the yield on the 10 year note is up by 1%. you can see it had been higher around the 9:00 hour. since augustighest 31. investors by bond and we wait and watch potentially for the fed to raise interest rates. emy, thank you. now we look at the top stories we're following this hour. mastercard forecasting slower growth over the next three years. it is the second-largest

payments network in the united that growth will be in the mid teens between 2016 and 2018. the company is maintaining its annual operating margin. costco's tiffany's in cash recorded to a federal judge who says the wholesale retailer violated trademark laws when it sold engagement rings labeled tiffany that were not made by the luxury jeweler. costco must pay the jeweler is earnings from the sales of the rings. tiffany may off -- also seek punitive is for the damage. citigroup predicting there is more than even chance of a global recession. demand fromt says china and the other emerging markets is the problem. that is a look at the top stories we're following at this hour. jeffrey gundlach says food prices could reach 60 dollars

per barrel in the near term but any is likely to be short-lived in large part because of an imbalance of supply and demand. two weeks ago, the price fell below $45 per barrel but has since fluctuated. i'm joined by mary of bloomberg news. we have seen oil going up and down and up and down. still below the 50 darl's -- $50 per barrel mark. >> you may see a rally in the near term, but do not expected to hang around and do not expect to get back to 60 or $70 per barrel. a chart shows between supply and demand, there is so much supply and we have picked up oil from various races and a flood of supply and that is not allen's by waning demand. some are coming to an end at the travel season. the industry is looking for lower levels of demand. those are in the wrong direction.

mark: what is he looking for in the near term? $65 is about it. the stock market rally, a could give the fed some support for raising interest rates in september but he thinks janet should not raise rates that -- this month. it seems this goes back to china, slowing demand in china. how is that affecting the outlook? >> that is right. that is what you will get in the markets to people will take the cue from china. up or down, strong or weak, this is the direction things will go. it does not speak to his strategy, but he cap hipped -- hat-tipped to donald trump. just quickly, a possible fed interest-rate, what does

possible hike in rates mean for all of this? things that could be parol for the job market, that a lot of these companies will not be able to refinance themselves and they have been depending on the free money, cheap money. all right, mary, thank you. we appreciate it. still ahead, all the news and analysis from apple's big event in san francisco. the stock spiked around 1:00 p.m. new york time when it again. it has settled back down since then. discussing theen new ipad pro, saying it will be available in november and cost 799, 1079, depending. stay with us. ♪

mark: the new i had pro has many characteristics of microsoft's tablet, including a case that doubles as a keyboard. apple also introduced a stylist for the device called apple pencil. >> we have been lucky enough to have a few developers come in and take a look at the new ipad and see what is possible with this incredible new technology. we would like to do a few demos. it would be great to have a developer, and show us what is possible with professional productivity. who would know better about productivity than microsoft? real productivity. [applause] mark: let's go to the bloomberg

editor at large, cory johnson in san francisco with the latest. you,e to begin by asking what about the price points? cory: it is really interesting. let me call this the most important pencil announcement in the history of pencils. it is fairly interesting. there is some orthodoxy there throwing out here. 2010, if you see a stylist, you knew we blew it. one of the things we said when steve jobs passed and tim cook took over, the real challenge would be to do things only steve jobs would do, to say i was wrong before. he would just reverse course and go in a different direction. apple is doing that. steve jobs said they will always want to own their music. people do not want to use -- they are making changes and

away from will go what steve jobs said and introduce products that we think steve would like even if steve said the opposite. microsoft on stage doing a demo, i cannot remember microsoft being on stage with apple all the way back to august of 1997, when you were still wearing short pants. 1,000,000,005 going back 18 months. they were about to go bankrupt. in and maybeched to avoid legal problems with the antitrust issues, $150 million investment to keep apple i've. steve jobs walks out on stage with a microsoft guy to show off new microsoft apps. he was met with a round of boo's from the apple faithful. he said we have to stop thinking about microsoft as the enemy. apple and microsoft can succeed at the same time. equal to wayar

back then, and with the smartphone and the iphone, they really left microsoft in the dust. mark: if the stock took a dive in the negative when they started talking about that? cory: much more important will be the focus on the is this user. cory johnson outside the apple event in san francisco. thank you. we appreciate it. coming up, clinton and sanders may grab the headlines but are not the only democrats hoping to be president. maryland governor, martin o'malley, is also running. he is our guest today "with all due respect." stay with us following the apple event outside, cory johnson is

standing by with the latest. we continue in just a moment. ♪

mark: it is 11:00 a.m. in san francisco, 2:00 a.m. in hong kong. we are keeping an eye on what's going on in san francisco. tim cook taking the stage, unveiling the company's latest products. spencer on the integration of the former rival and the best and worst housing markets. mark: a corruption investigation has landed united ceo out of a job. will criminal charges come next?

good day from bloomberg headquarters in new york. this is architected i mark crumpton, here with pimm fox. pimm: let's get a look to have markets are faring right now. taking a look at the dow jones industrial average come also lower by .6%. the nasdaq falling .3%.