reckoning is approaching. scarlet: as prices decline, and a shift in the world oil. how the market may finally strike a balance. pimm: and if you like utility with your luxury, low, we have a bentley automobile for you and it comes with a big price tag of $260,000. ♪ scarlet: good tuesday morning. i am scarlet fu. pimm: i am pimm fox. we are 90 minutes into the trading day. let us take a look at how architect trading right now. let us take a look at stocks. scarlet: up near sessions highs and it follows as european stocks have come from losses. asia finessing -- finishing on a

downside. the production still a chart on those asia-pacific markets. pimm: let us look at treasuries and see how the bond market is going to do we are currencies first. euro gains in strength against the dollar. the japanese yen weakens against the dollar and the pound sterling giving up a little against the dollar. do you want to take a look at commodities? scarlet: let's do that. the doj to decide not to do anything. crude oil actually rising for the first time in three days, rea rebounded from a two-day drop your gold continues to sink lower and natural gas down by 4/10 of 1%. pimm: more on oil in just a moment with daniel. scarlet: let us get it looked at the top headlines in just an hour. we look with the manufacturing sector hitting a speed bump. actually production -- factory production fell for the first

time since january 2014. in the meantime, a stronger dollar hurting demand from overseas customers. it is a sign that consumers may be looking past the turmoil in financial markets. retail sales in u.s. climb for the second month in a row. the increase is 2/10 of 1%, just below estimates. general electric is moving 500 jobs overseas and the company says you can play in the u.s. congress. it all has to do with the congress policy refusal to allow the export import inc. to allow financing. ge is a beneficiary of the bank and a credit provider will lead to some of the jobs being moved to france. in india, the state-run airline has grounded about 130 flight attendants because they are overweight. air india calls it a matter of safety. shockingly sections. most of the ground and flight

attendants are women. under air india guidelines, employees found to be overweight up given six-months to shape your call this twitter's contribution to the political process. twitter has unveiled a tool it says will allow anyone in the united states to make a political donation using a tweet. pany is teaming up with mobile payment company square, who ceo is jack dorsey, who also happens to be the ceo interim of twitter. scarlet: coming up, we give you a glance here. pimm: as target is taking on amazon, why it is teaming up with its to cart. talks about oil and what is next for the commodity that runs the world. one company has revolutionized the way students and recent college graduates can find a job. scarlet: those stories and much more coming up on bloomberg market day.

in the meantime, we get back to our top story. .imm: thursday scarlet scarlet: thursday will be the day everyone is waiting for. finalwe are entering the hours of discussion and wall street cannot seem to get on the same page when it comes to federal reserve interest rate increases. eric nielsen is a chief economist and says skipping september will raise the risk of more turmoil. merrill lynch's david wu disagrees. >> i think the international evidence are sort of overtaking the u.s. fundamentals here, especially with what is happening in china. if they were to hike in september, i think it will be a mistake. scarlet: what do our resident economist say? here with us is mike mckee and chief economist carl cricket on riccadonna. is the fed moving because it is afraid of making a mistake or

getting ahead of itself? side itu can pick what could be on because it is such a close call. carl: i'm going with the fed holds actually. we have seen over the past five years several central banks raising rates and then having to backtrack. this is a very dangerous policy mistake and there is limited ammunition to reverse course if the fed needs to. they do not want to go down the route of additional quantitative easing. the fed is want to air on the side of caution and hold off to see what extent of negative feedback into the economy from recent developments in fact are. as of late, it looks a little bit troubling. we had a big pullback in consumer sentiment last friday. in today's new york empire survey is a bit of a sentiment gauge as well. much weaker than expected. pimm: what about the retail sales report? stillthat is a

reported most of the retail sales figures have mentality this is a rare occasion where the empire survey counts for a lot more than retail sales results. scarlet: mike? fed'si will say that the mandate is that the u.s. economy seems to be in very good shape. the labor market looks good according to the august payrolls report. not, itit is stale or is suggesting that consumers are still spending money. the fed is looking at the u.s. economy and unemployment coming down and say the danger is out there down the road that we could see inflation as they are not deciding based on what is happening right now. they are deciding on the forecast for what happens a year from now. as for what is going on around the world, you look at what stanley fischer has said. clarity and all you will get is confusion of a different sort in the next month. if you think you have a reasonably good picture of what is going to happen for the economy going forward, you go ahead and go and maybe eliminate

some of the market volatility in the process. carl: janet yellen looks of factory sector. if we look at growth this year, it is 1/10 of one percent. the factory sector is taking it on the chen from the strong dollar. janet yellen does not want to exacerbate that section and that impact. and that impact. a lot of analysts mistakenly say that the strong dollar on the impact the export sector. it certainly impacts the export sector, but it also is unleashing a flood of cheap imports to the domestic economy, which is why you see three activity lessening. if you look at job creation in the six-month moving average, it has been slowing down. the economy is good. i agree with mike. but it does not justify a move yet. scarlet: economist on average do not expect we will hit a recession until 2018, so the prognosis is fairly good. is waiting to long good than? stanley fischer looks at

what we see in the inflation figures now and says you drop up a big fall in oil prices and you're going to start see slack taken up and inflation pressure start to rise. we saw a little bit of weight gain in the last employment report. it is not there yet, but their models suggest it is going to be and they going to make the decision based on what their models and their forecast is. carl: if you look at the fed's preferred core inflation gauge, we are backsliding. we are back to march levels. we have not seen the whites of the eyes of inflation yet. i do not know if it is too late or an argument he made a while back. but it may current environment where we have very low inflation, the risk of a policy estate from the fed and the staff forecast at the last fed meeting indicated as such of the bigger risk is to go to sing. mike: you made the point of going up and having to go back down again. at jackson them said

hole that that is not a problem for them. they are happy to go backwards if they need to. scarlet: let us touch on the dollar because you brought that up being an issue for the manufacturing sector. there is a weay that the fed looks of the dollar than trade looks at the dollar. mike: it has been coming down and it would suggest it is not a problem. the fed is looking at the top line there and it is continuing to strengthen the trade weighted dollar. that is, as carl says, a weight on the u.s. economy. the question is an fed officials are asking this question of themselves -- how long does that continue? how much strength have we got in the dollar and how much more will be get? is it already priced in will it continue to go higher? historically when the fed raises rates for the first time, the dollar starts to weaken. carl: the dollar is driven by differentials. if they stumble into a series of

rate hikes, they will make the dollar even stronger. the broad weighted index on the screen is at a 10 year high. pushing it up further would have disastrous consequences for the mac and economy. scarlet: no one is thinking about that anytime soon. carl: but what is the point of raising rates if you're facing all this uncertainty, we manufacturing data, potential pullback in business and consumer sentiment? pimm: maybe we see get carl to tell us how he really feels next time. [laughter] mike: as you can see, it is a close call. scarlet: thank you so much, michael mckee and carl ricca donna. pimm: join us for live coverage on the federal reserve's rate decision at 2:00 p.m. eastern. this is followed by janet yellen's news conference that begins at half past at 2:30 p.m. eastern. scarlet: michael will be there at that news conference. pimm: we have much more coming up on "bloomberg market day."

♪

scarlet: welcome back. i'm scarlet fu. pimm: i am pimm fox. ramy has an update on what is happening in the markets right now. no, it is not ramy. it is matt miller. matt: we have a lot in common, but our name is not one of those things. we are looking at gains of almost 1% across the board. there are fluctuations this morning in early trading. we are pretty solidly up. and 16 528on the dow the level there. i want to show you a couple of stocks. i'm looking at a really interesting terminal screen. the bloombergis social velocity monitor. you can see a lot of things here

as far as what people are tweeting about. you can see the volume of the news here and what time someone tweeted about the stock and the change in the amount of tweets that people are doing here. for example, i can come down and clicked on show your energy -- energy and how much people have tweeted about that stock or i can see all the headlines that have come across about that stock. take a look at the ones, illinois. because of it bank of america and merrill lynch upgrade, the analyst blair says he thinks the and the valuation prices to low compared to competitors. people are more interested in can make us think last makers, which is good for owens-illinois. 6.3% at 21.3 for the price there. a lot of people have been tweeting about today as well is one i want to bring up as well.

got a raise from carl icahn to almost 10%. 9.95% from eight and change. you can see this thought gaming 1% as well as people like to get on board with carl icahn. energy is having a pretty good day as well because oil prices g is noteven though ln into oil production. finally i wanted to show you that black rock's getting an upgrade, not just by anybody, but goldman sachs. dded to the goldman sachs by list. back to you, erik schatzker and olivia sterns. [laughter] pimm: you just cannot help yourself, could you? thanks very much, matt miller. target has teamed up with and instacart to deliver

household items and groceries for $3.99 to rival amazon's grocery delivery service. get out your calculators. cart's will be insta second-largest retailer by revenue. the first of the cost of. i want to bring in cory johnson. corey, yet another retailer wants to get into the business of delivering your food. cory: what is interesting about this is that you are totally wrong for the first time ever. target is not getting into the business. they are partnering with a san francisco aced start up. it is an 18 cities in the u.s. right now, but certainly big plans to expand and have taken venture capital money to do so. partnering with target, companies get something out of this. target is trying this out in minneapolis, their hometown. the grocery business is very important to them. they have devoted 1.7 million square feet nationally to the

grocery business, but it has struggled in times, growing slowly as the rest of their business has struggled. it has given another outlet in a way to connect with consumers who do not want to get off of the couch and have their grocery show up. tacart, it gives them a tremendous advantage. one deliveryuses service, it gives them a great share in that market. amazon's delivery service in seattle has 70% of the market. in new york, it has 70% of that market. first mover advantage seems to be great in that business. for having the standard offering, target is able to get out to those customers that want to be the principal agent for delivering food. scarlet: beyond first mover advantage, what else does amazon or whole foods -- what have they taught us are what have they taught target in terms of the

challenges of delivering fresh food on the same day? cory: there are a couple of interesting things about the orel unlike the amazon model the wet van from days of your. -like.much more uber the delivery people are contractors using their own vehicles and often doing the shopping at the stores themselves. they will pull the items off of the shelf and communicate with if you want the one liter bottle of diet dr. pepper instead of one court, i don't know. the shop will actually bring you up and offer those different kinds of selections. as a contractor not getting health benefits and not paying social security, it is much more voluntary work force that shows up when they want to work and our next or cash. it is very much in the uber mo del. target is a very important model. instacart get a lot out of this.

aroundnt to perfect grocery and delivering fresh things, but they imagine they will create a network of political -- people to living all caps of stuff. it could create more opportunities if this partnership is indeed expanded. scarlet: cory johnson, thank you so much. cory johnson joining us from san francisco. do you get your groceries online or go to the store? pimm: i go to the supermarket. scarlet: i'm chinese. i have to get my food all fresh. i don't trust someone else to pick it. coming up, how low will oil prices go? it is that $44 and change right now and there's big this agreement on where goes next. daniel yergin has a prediction. ♪

pimm: what is the future of the world oil markets? investors are watching as oil prices decline, but investors like daniel yergin are looking at the bigger picture. earlier this morning, he brought his expertise to "bloomberg

surveillance." and tom keene asked if you to $20 oil could drop a barrel. daniel: we are in a world where it could drop to the 20's or 30's reflecting the fact that there is a lot of oil out there and there is not a balance. tom: when you parachute into opec right now, what would your message be to opec leaders? daniel: a message would be the world is very different than what they thought it would be and it is out of balance and it will continue for a while. it would be a message to all oil exporting countries that you have to change your mindset. it's a different world. tom: is it because technology has been overwhelmed by the technology predicted? daniel: it has transformed it. an almost doubled u.s. oil production since 2008. this is a huge influx of oil

into the market that the market was not prepared for. and by the way, during this per iod were prices collapse, u.s. and saudi arabia have added 2 billion males a day. -- barrels a day did tom: saudi arabia is 70% absent. en: what is the next cartel and oil? daniel: i do not think there will be a next cartel and oil, but what will happen is these million-dollar projects that are going to be built that were going to come on stream have been postponed or they had been canceled. that is going to rebalance the market. brenden: will it bounce out?

daniel: right now, it is going for market share and it wants to preempt the entry into the market. : what are the macro events were state policy will tell the oil markets what to do? theel: it is him as reverse. the decline in oil prices are going to have geopolitical consequences. i think it is not inappropriate to point out that many of these petro states, many of the states full to -- bolstered by high oil prices have not been on the international scene. although no one wants to have things rapidly shifts, the decline in the price of oil will ultimately benefit the forces of liberalization, democracy, and popular government. tom: do you agree with that? daniel: i was thinking about how our own economy since 2008 has benefited from the activity in shale oil.

you can see that manufacturing companies are now reporting distress because of these domestic expenditures are not happening. enden: which of the non-oil states has done the best job of adapting to the new price of oil? daniel: i think everyone is in the state and lowering the price level. it looked like mexico was going to do it with the reform of hassector, but it been caught up by the speed of the plastic on. norway well adjusted to its oil, but who are the other countries that have diversified its economy? malaysia was on that list, but it has now got into controversy. pimm: that was daniel juergen speaking earlier today on "bloomberg surveillance." scarlet: this is the intraday chart of crude oil. pretty much near our best levels of the session, up 1.5%, gaining

after a two-day decline. we have inventory data due out tomorrow that will lightly -- likely so that remains a glut of oil prices. pimm: if you come inside my bloomberg terminal, while those trading on an intraday basis by happy, those trading on a long-term basis are sad. index fore s&p exploration and production companies. there you can see this is $35.30. last september, it was $74. scarlet: i'm taking off. yet much more coming up. pimm: we have much more on the "market day." we have matt miller and a new suv from bentley. ♪

pimm: this is the bloomberg "market day." the cofounder of the subway restaurant chain has died.

he was being treated for leukemia. subway is celebrating its 50th anniversary this year. the chain has more than a 44,000 locations around the world. yahoo! plans to and off it alibaba stake without paying billions of dollars in taxes. the irs says they have misgivings about deals like the one yahoo! is contemplating. they hoped to's and off the stock and avoid $9 billion in taxes. amazon founder jeff bezos is making a big on outer space. to space startup is going invest $200 million to make florida its base of operations. they will launch rockets from cape canaveral later this decade. the investment will create 330 jobs. the friendly skies may not be that safe.

a government watchdog says the aviation system is plagued by wrong data on a flight plans that may confuse pilots and air traffic controllers. computers may have multiple routes filed for the same flights. retailers have more to worry about than shoplifting. a new study says born more stores are being robbed by organized angst. popular -- gangs. popular items are mobile phones and if cards. those are your top stories at the moment. the markets are closing in europe. let's go to mark barton in london. stocks rose.-- i counted four ups and downs. the initial concerns about china and the way. the fed is the big elephant in

the room and we can worry about that on thursday. automakers are the best performing group. what a day it was. it started in that direction. let's look at some of the big movers across the equity markets. there is a big auto show taking place in europe. the growth momentum in china will last through 2016. shares are up 1.6. shares in the minor fell 8% to a record low. the are down 40% since china evaluation. they finished up 8/10 of 1%. that is a wild gyration. rwe was down i 3%. they sank as much as 14%. decommissioning

nuclear plants and that will be insufficient. i want to finish with the strange day. fascinations, gyrations, call it what you will. stocks finish tire, but it wasn't straightforward -- higher , but it wasn't straightforward. pimm: coming up, everybody remembers their first job. the remember how challenging it was to actually get it? one company is trying to make it easier. $.78 or each dollar a man earns. retirement,ans for we've got that coming up on the bloomberg "market day." was recentlyuv revealed. matt miller is here. he spoke to michael winkler to

discuss it. go ahead. matt miller: it would make sense. it's supposed to be a nod to the yga region. i've heard them say it different ways. that is because of the region. talk price and tell me what can of my great you get for the price. matt miller: the price is $230,000 before you at any options. options ares that very expensive and you need as many of them as you can get. the price will probably come closer to $300,000. it is an amazing vehicle. it has the w 12 engine. isbasically has two v6 bolted together. it is over 600 horsepower.

there is a boatload of torque. it has a bunch of really cool industry first, including a separate 48 full electrical system that powers the suspension so that when you are going around the corner, the inside wheels get a stiffer set up and you don't get as much body role as you would with sway bars that are set up to do kind of the same thing but can't change their character to absorb potholes or speed bumps when you are going straight. pimm: you spoke to michael winkler? the new ceo.he is he says they are going to sell about 3500 the first year. our sources say they are pretty much sold out. they are not officially allowed to take orders yet. the demand is high enough to reach that. he will eventually sell 5000 and year after that.

this is going to boost their volume by 50%. pimm: that suspension system gives it a ride that is similar to riding in the back of a very posh automobile? matt miller: riding in a car, basically. the knock on suv's is a are tall and there is so much role as you go around corners. this is going to be better than your typical suv. it's going to cost a lot more. it's going to be a hell of a lot faster. it's going to be incredible. the queen guess the first one. apparently she has already driven it. she has a hill at a property in scotland's that she has always insisted only her range rover can climb. she has a 1950's range rover that she loves. bentley sent her one of these. it has real off-road capability. pimm: you said 3000?

that's they're going to sell the first model year? where are they selling these? matt miller: did you do the math adding $30,000 in next is? the u.s. is going to be the biggest market. china would be, but it's unlikely to be now. other luxury brands like rolls-royce -- pimm: i remember when you did the convertible. matt miller: it is falling like a rock. now they have to look for other sources of growth in the middle east. object, money were no would this be the suv? matt miller: yes. if money were no object. i would rather have this than a bentley. i would rather have this than any of the four doors. have 16tley owners

cars. it's not like they just use one car. pimm: thank you very much. ahead, how one startup company is looking to change the way college students and recent college graduates search for jobs. that is next. ♪

pimm: i am pimm fox. let's look at some of the top stories crossing bloomberg right now. ups is hiring for the holidays. they plan to bring up to 95,000 temporary workers. they can handle the increase in holiday shipments that begins in november and lasts through

january. the online real estate marketplace compass is valued at $800 million. bloomberg news reports that the revenues have grown 10 times in the past year and they list agents to work with buyers and renters. target is taking on amazon when it comes to same day delivery of groceries. they are teaming up with insta cart. they will be limited to minneapolis. those are your top stories at the moment. do you remember how you first got your job? the very first job? was it through your mother's best friend? media spent afternoons walking door-to-door, inquiring about openings. one company is working to revolutionize the job hunt for

college students and recent graduates. they are creating the largest online marketplace. the founderis liz, and chief executive. tell us how you started it? liz: we are fairly new. we have grown quickly. we are about 25 full-time team members. we launched by saying the purpose behind the company was people could not find a job. awesome gpas. had they did know -- not know what to do about finding a job. pimm: explain how it works. job and they say exactly who they want. they say only show my job to students who speak spanish or seniors who have a 4.0. they can post with a click. they pay for every application

they receive. get only give them -- qualified applications. degree view a 360 of who they are as a person. pimm: how many students you have? liz: hundreds of thousands are using our site where it pimm: how many businesses? liz: over 6000 businesses have signed up. pimm: you have hundreds of thousands of, what do you see when you look at the data coming in from the students? what do they want? what is the ideal match? liz: a lot of students don't really know what they want. they want to try out many things. ,f they are a marketing major they want to try a marketing job or perhaps a job at a tech doingy doing finances or

personal assistant work. pimm: you are connected with about 2500 campuses. $9 million.sed what are your goals for the company? liz: our focus is on focusing and growing our student side and are business side. toare a marketplace. we want get as many students applying for jobs for as many businesses as possible. are you able to see the information that students post about themselves? liz: yes. one of the specifics we are most proud of is one in every three students gets hired for a job they apply to. 30%. pimm: over 30%. how about the cup titian, linkedin -- competition, linkedin, for example.

students don'tge have a profile on linkedin. you don't really think about going there to find a priest a job or a summer internship. our biggest competition is nepotism. their last jobot through a family member or friend. pimm: is there any age limit on can post their information to liz --. liz: no. student orve to be a recent graduate. hopefully one day we will get there, but we are working on college students now. pimm: what is the most popular job-search? liz: tech companies are very popular. as non-english speaking people, can they post

in their native language and get a job that way? liz: yes. disney posted with us last week for a japanese role. you had to be able to speak japanese. parts forne of the students on our site. you know you are qualified for that job. a commony, it's like app. pimm: describe that people who have not applied to college in the last 20 years. have a profile on our site as a student. you fill it out. when you see a job, all of the information gets sent directly to the business. you don't have to fill out a profile every time. very much foru giving us the information and keeps up-to-date on your progress.

she is the chief executive of wayup. we've got a special "surveillance" coming up on thursday. ♪

pimm: coming up tomorrow, a special primetime edition of bloomberg "surveillance." that is at 6:00 eastern on wednesday, right here on numbered. more than ever before, the new york city office worker has their choice of and healthy -- the vicious -- delicious and

healthy food options. interviews the new spotssed lunch bots -- ceo. rebecca: people have become obsessed with it again. i spoke to adam. chain a steer in new york. ,e want to make high-quality freshly prepared food available to the masses. rebecca: where do you get all this food? adam: the majority is coming from long island, upstate new york. rebecca: how do i trust you? you did have one thing on the menu that's from a local farmer and i'm led to believe all of it is.

adam: if you want to learn more about how we are doing this, you will ask and you will find out. we want to do it the right way. it's not just window dressing. rebecca: lunch is the most exciting part of the day. we just want to eat something good. i think that's the appeal of something like dig in. --.: this is a very classic -- dish. it's back andde, cheese. i would like a little bit. we are introducing a dollar shot of mac. it's just a little shot cup. it's a dollar. you can enjoy your vegetables and feel like you are getting a satisfying meal. rebecca: if you eat a whole mac & cheese, you will probably fall

asleep at 3:00. that is also something i have done. it sounds like you do work about the working lunch population. how much were you thinking about that? adam: when you are in an urban environment, ignoring the lunch worker is not going to work for you. you want to deliver something people can consume on a frequent basis. the people doing well in our space are offering food and products where i can have this multiple times a week and still feel good about it. rebecca: variety is the spice of life. i think there is fatigued with salads. adam: if you had a salad yesterday, you don't quite want one today. where else are you going to go? rebecca: i will always go to japan late. it must be healthy. adam: i keep falling for that as well. pimm: now it's time for the

options insight. let's go to matt miller in the newsroom. matt miller: we are approaching the top of the hour. we will look at how the major averages performed. we have been up for most of the morning and we continue that trend. the dow is up. from mk m is jim holdings. what are we going to look at today? it's two days until the fed decision. i assume we will see trading slow down until that happens. how you play the market? jim: these are two of the slowest days. it is rosh: hashanah. here.quities are higher critically, we are in the middle of a shock. it's not over. historically, the big futures are inverted from upward over

three months. that typically does not move back below 20 44 months. for four months. that is not typically what happens. matt miller: when you talk about x being inverted, they are lower or higher?' jim: they are higher now. in the near term it will move up over time. matt miller: how you trade that? jim: the takeaway from an information perspective is volatility should remain elevated and it is self volatile for an extended. of time. that is the main point.

-- extended amount of time. that is the main point. ap volatility event, we have data. we still want to be leaning into this. we want to exploit distortions in volatility. term structure is inverted. datedolatility, by longer in volatility. intel is an example we used here. hedge.e afraid to the fed's later this week. the retail still see of that from the 1870 level. don't be afraid to put on near-term hedges. matt miller: what is your exact trade? jim: in the next volatility, investors want to play and unwind.

the vxx.o look at we just want to look out to december and we want to buy 2015 . below 15 at expiration, that is a two and a half to one pay off. eventually, it will return to an upward sloping yield curve. we can take advantage of that. matt miller: thank you so much for joining us. more on the bloomberg "market " coming up after this short break. ♪

matt miller: it is 9:00 a.m. in san francisco. it is noon in new york.

betty: this is the bloomberg "market day." this comes after markets sold off again. new economic data is putting the feds rate decision. retail sales were strong, that industrial production wasn't. scarlet: we will speak to the former obama fundraiser who has been meeting with joe biden over the weekend. pam: good afternoon. hows begin with a look at stocks are trading at midday. equities are gaining. we are near our highs of the session.

one catalyst may be retail sales it came in lower than estimates. there was yet another month of gains. maybe, consumers are overlooking the volatility. the august slump we have seen in stocks, they are still buying. retail sales over the last several months are bobbing up and down, but we are gaining momentum right now. moving on to oil prices and gold, we are seeing brandt rebound right now. part of that is due to the retail sales numbers. you mentioned, the industrial production numbers, let's look at the bonds market. this is a selloff across the bond market. is at three quarters of a percent. they continue that selloff. let's look at how the dollar is

trading against major currency pairs. the dollar is weakening against the euro. the yen is steady. the pound sterling is up a little bit against the dollar. now let's go to some top stories at this moment. the manufacturing sector hit a speed bump. factory production fell last month by the most since 2014. automakers scaled back after a big surge of production in july. a stronger dollar is hurting demand from overseas customers. a push by the slump in u.s. oil prices, shale producers are finding new ways to cut costs. they are getting more oil from fewer rigs. the number of rigs is down 60% from its peak. crude production is down just 5%. goldman sachs says crude could fall to $20 a barrel. one analyst does not believe it. daniel juergen tells us the

industry will retain its balance. daniel: that will only happen in a true panic. we are in a world for the next six or nine months, 40 or maybe high 30's. there is a lot of oil out there and the market is just not in balance. pimm: inventories will strike because the price slump will drive some small pillars out of business. betty: yahoo! is planning to been off their alibaba state taxest playing -- paying is in doubt. yahoo! that up to spin off its stake and avoid $9 billion in taxes. subway haser of died. he was 67. he had been rattling leukemia. subway is celebrating its 50th anniversary. they have more than 44,000 shops around the world. a rare television

appearance by a steam court justice. stephen pryor was a guest on "the supreme -- the late show with stephen colbert." breyer: the biggest benefit is you take every minute of it very seriously. it calls for you to put forth your best every single minute. he said when he is deciding a case, he is deciding -- 315 315 million million people were not in the court. betty: a billionaire has the --t viable contemporary art valuable contemporary art collections. he is opening up a museum. robert wolf joins us to

talk about his meeting with vice president joe biden. betty: virgin galactic is trying to expand its business. we will tell you what the richard branson space company will bring. pimm: confidence is high and volatility is low. this time, it's different. thes&p has tumbled 10% and x is well above 17, that is the average level win interest rates are tightened. -- when interest rates are tightened. here with some insight is a partner. great joe, that is a fact. we are seeing some volatility. why would the fed tighten now?

joe: i am not going to prognosticate on the fed. i gave that up years ago. it is calling volatility in the market and august was a particularly volatile month. it doesn't have the robustness that most people thought it had. it's probably because so many markets are linked together. when one market seizes, they all seem to catch cold. the equity market did not do a good job. betty: the fed hiking rates? joe: i care what they do. toare trading on behalf of shoot you are making those decisions. i saw a quote today from larry summers. a rate a 20% chance of hike, the fed should act on what the market is predicting. that is backwards to me. i think it should be the other way around and the fed it should

be taking the lead. pimm: give me a description on what's going on with high-frequency trading. joe: it's still going on. nothing is changing since the michael lewis book. there is different types. there is more predatory stuff. the regulators still have not caught up. they still have not figured out. , hee have been some cases was one guy. the problem is in the structure. pimm: tell me the extent to which high-frequency trading affects price discovery in all markets. it's not just the equity market a are involved in. they are big in the treasury market and the use a lot of that for hedging. joe: he was concerned. he did not say high-frequency

trading, it causes the volatility. is it calling -- causing or reacting? i would argue you are seen movements that are much faster because people are pulling away from. they are not going to get run over. hey just walk away. there is no affirmative obligation like there used to be. i am not advocating the old model. if people move away, it causes vacuums. you get prices like you did on august 24. prices were down 30% to 50%. betty: because the structure is so different now, it is a given that reaction to the fed will be that much more exaggerated. joe: i think it's been that way for years. the only thing new is at the ark

are amped up and people are nervous about china. we have seen these reactions over the years every time the fed moves. every time and i sm number comes out. you see the liquidity vacuum disappear. that's why you have these rapid news. pimm: we understand that, is it this and unintended consequence? if you get big banks out of trading and providing liquidity on a regular basis because the government says this is too risky and we don't want you doing this with insured deposits so get out of this business, where does the business go? joe: it goes to a provider. there is a void. there is no liquidity. you're right. the big banks are pulling back and avoid was created. people don't need to be there. terryet today is a brian

traitor. traraitor -- proprietary der. it's a big difference when you have customer low. that does not exist anymore. you can have rapid movements in the market because they will stand there and take a hit. that's why we have a market. pimm: is this a case where you kill the goose that lays the golden egg? not only you have the order, you know where all the orders are. joe: they used to have 80%. they called this a sad experiment. he is protecting the old model. he had some very valid points in an interview this weekend. there was an obligation. there was a market there. there was a limit. it had a robust feel to it and you did not have the rapid moves

you saw on august 24. you don't have it now. you have a fragmented book. you have a lack of diversity. you've got a book based on payment for overflow. it's ridiculous. pimm: paying people to trade in your exchange. there are a lot of conflicts that create these problems. that's why you have structural problems and the regulators don't want to address those at the root cause. they will tinker around the edges. they are not getting at the main problem. role-play,l season a they created instant replay. they had issues they needed to address. investigators are confusing -- continuing to let it happen. it's like an armchair are back on television. e:.

do i expect another flash crash? yes. pimm: well, though and on that happy note. china's largest brokerage is under investigation for insider trading. betty: we will tell you what it could mean for china's volatile stock arc it. stay with us. ♪

pimm: this is the bloomberg "market day." on our highs of the session. we are having a nice rally. matt miller: we are doing quite well. the dow jones is up 170 points. the s&p and the nasdaq are both

gaining 1%. i was studying my revenue per available, there are concerns about that in the hotel industry. pebble brook was the first to come out with a lower forecast or cutting its own outlook or in now you see --. now you see marriott with the same concerns. this may be lower than the outlooks have been because of the jewish holidays this week. it may not be a strong as people thought. if you look at my terminal right now, you can see the johnson redbook same cells index. -- sales index. anything below this line is dad. we have fallen into a contraction in the last two weeks. we're down 1.2%. retail stocks have taken a negative hit here it one of cons.is

they dropped 4.5%. people came out and said they have a new ceo and we are not sure about him. we are going to downgrain this -- downgrade this to a hold. on the other hand, people came out with an upgrade if you take a look at nordstrom's. now they have a buy on it. team,ike the management they have seen what they can do and they are up grading the stock. it is up 2%. betty: thank you so much. pimm: let's take a look at some of the top stories at this hour. a routine new's conference becomes anything but when the bmw chief executive collapses. today at the stage frankfurt motor show. he is ok.

he was not feeling well after an extensive route of travel. betty: that is a scary moment. is valued marketplace at $800 million. the revenues have grown 10 times in the last year. they list properties on the web and employee agents to work with buyers or renters. pimm: the president of china's is oak ridge firm is latest target in a government investigation. it is privately owned. it prompted a government cracked down. to get more insight on this probe and what is going on in china, jon luther is join us. it's great to have you with us. significant and

serious these allegations are and why we should care. jon: i would be sitting up and taking notice of this. nobody is untouchable. this is the largest brokerage. it is part of citigroup. the pedigree is impeccable. it's the top, the preeminent brokerage out there. the number two guy out there is getting investigated for insider trading. everybody is thinking, what's next? betty: is this going to send a chill through the market? john: most deftly. what's the feeling like if you are in the financial business in china, particularly in the stock market? what have you been dealing with. some stocks are not trading. the government can show up in the middle than night and ask for all of your records. way, you don't

want to sell stocks if you are in china right now. john: i think you are being very careful. you are watching very carefully what the government does. you see a lot of volatility because the data is all bad. it's pointing to softness, but the government is trying to hold everything up. ,he data tells you to one thing but the government tries to tell you to do something else. betty: the markets are still quite relentless. sayeard the premier everything is fine. we're going to continue to support financial reform. the u.n. is going to be stable. the markets keep going down. we saw that last night. disconnectthere is a there. short-term, all the data says softness, the economy is

weak and there is no sign things are getting better. long-term, he is probably right. there are many reasons to be optimistic about china in the next five or 10 years. in the next 12 months, who knows? pimm: the white house is getting ready for a very special visitor. john: this will be his first state visit. he came as vice president a few years ago. there is a great deal of importance on this trip. the chinese would like to see this trip help put relations on a new track. there are a lot of problems. we have cyber security and trade. we have military maneuvers. i think the chinese are hoping at this can be a catalyst for change in that relationship. betty: getting back to this securities issue and the

president, one of the chinese trying to say? what are they trying to say by attacking such a senior official like this? john: if i was in a brokerage in china right now, i would say nobody is off limits and everybody, if you do something that you should not be doing, you are in danger. you are in danger. betty: the feeling in china is that the stock markets are rigged? trading rampant insider that goes all the way up to the hollowed halls of very senior management? very hard to it's say. i think there is suspicion that there is a fair amount of insider trading happening in china. the government is saying enough is enough. if you do it, you are going to get it and it doesn't matter who

you are. pimm: thank you very much. betty: he is our china bureau chief. pimm: still ahead on the ."oomberg "market day betty: what do you do when you own a our collection? you build your museum. ♪

betty: this is the bloombergbetty: "market day." pimm: if billionaires have enough money and art, what do they do? betty: they build their own museum. largest owns one of the art exhibits in the world. he is opening his own a $140 million museum. david got a private tour and sat down with eli broad. the light: i think it's a good thing that more people are getting involved.

i don't know that these prices are a good thing. for of the work we bought $6,000 is selling for millions now. that make you look at them as investments? people.ell david: i find that fascinating. despite the fact that your much,tion has gone up so you look at it as a psychic investment? eli: if i go back and say what could we have done if we would have invested in some of these startups in silicon valley, we would've done a lot better. betty: david joins us now. it's interesting. what motivates them to collect art? david: he was in business a long time. he always liked meeting with artist.

it's relationships principally. he spent a lot of time with roy lichtenstein. he likes to hear what they have to say. we stopped in the warhol room. he confided that my wife really liked warhol, but i did not get them. pieces saw all the together, he saw what warhol was trying to say. he is looking for commentary on society and history and he has the means to grow his collection by a piece of week. i like the jeff koons. they really stand out. i know a lot of people don't like them. thank you. i will see later this afternoon. betty: thank you. we will be back. ♪

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headlines. this guys may not be safe. says it ist watchdog played by wrong data for flight plans that could confuse pilots and controllers. computers might have multiple routes flying through the same flight. they can fly off course. in india, the airline has grounded 130 flight attendants because they are overweight. air india calls it a matter of space. others call it shockingly sexist. employees found to be overweight are given six months to lose the weight and shape up. ii will become the first customer of the bentley's luxurious suv. they can go 187 miles per hour and can cost at least $250,000. one of them pulls into our courtyard right here in new york this morning. >> it is the first suv that we has ever made and also the first suv in the ultraluxury space.

it combines all of the speech -- all of the things you would expect. luxury on the interior and ultimate performance. : it looks like a monster there. there is already a long waiting hers.efore the queen gets a rock legend, janis joplin, once sang about wanting a mercedes-benz that in real life, she drove a porsche. it is now headed up for auction after spinning two decades at the exhibit in england. it is expected to bring more than $400,000. what a cool paint job. that is a look at top stories at is hour. all summer long, the polls have beeninging the same trump tune. now a stretch -- scratch on the record. now within is

riking distance of donald trump according to the latest new york times tbs pole. 23% of republican voters act carson for the republican party nomination. trump is at 27% with rivals like jeb bush trailing far behind in the single digits. bernie sanders is surging past hillary now with double-digit's in iowa. new hampshire as an undecided joe biden lurks in the wings. discuss all ofto this and the state of the presidential field is the former ceo and also a well-known wall for presidentser obama. glad to see you. god -- i am glad i am airlines infor the india. betty: you look great.

let's tackle the republican stories before we get to the democrats. mark wrote this great piece. what do you think? >> i met him before. i'm a business guy. he is resonating totally on the other side. it seems to be taking a wave of its own. i am not worried because i think at the end of the day, democrats think he will be the president of the united states. i think the narrative that secretary clinton and the democratic party is talking about today is where the country is. they are pro-immigration, and with respect to social issues, they are progressive. ofhink there will be a lot discussion. if you look at the president possibly, it is working. i think people want to carry

that forward. betty: i want to tackle that. i want to get to trump. you mentioned you know him. you have met him before. we have played golf together and i have had lunch with him. inyou grew up on wall street the 1980's, estimate the art of the deal is a book you read. betty: does he have the qualities of a president? robert: it is not the qualities unlike vote for because many, i want someone with government experience. it seems the republican party has been pushing for a new type of politician. it is the voters. robert: pushing for a new type .f politician you look at trump and carson and they'recombined, probably over 50%.

democrats bye history. top two now are longtime politicians. bernie sanders and hillary clinton. spinning about hillary clinton, you saw the polls the other day where she is down 10 percentage off 22 percentage points in new hampshire. are you worried? the polls,i watched mitt romney would be the president today instead of being wiped out by president obama. i think the day before he was still winning in the polls. she starts at 75% or 80%. just like the republican primary

does it i am not worried about where secretary clinton will be. the poll is where we are for a snapshot today. there is no question. i'm not surprised when someone is at 75%, there is a normalcy. i would look at everyone passes internal polls. will nothire and iowa defined solely who our next president is. president obama lost to hillary in new hampshire. tough competition. i do not think it will be predicated on united states. betty: let's just say we are not a year out. we are six months out. you see the poll numbers will

not favor clinton care what you change support? i do not want to spend late what i would do. i'm supporting hillary clinton. vice president biden is not even in. would say to me, i am a democrat first and foremost. i'm not hopping on different places based on where polling is going. when i started supporting barack obama as president, he had a 1% approval rating in the polling. i saw something there. really proud, i'm of secretary clinton plessy's standards are we will go back to the platform issues. it will be about the economy, foreign policy, immigration, social good. it will not be about the things that seem to be in all the rhetoric today. ok.y: you are behind secretary

clinton. withlso had a conversation joe biden. i am flattered and thered to sit down with vice president and he requested the meeting. i mean, younn, know, they called up and asked to meet friday to we met friday and one for 90 minutes, at the midtown hotel, a great meeting it was anct is, incredible conversation for me as a data two boys. when he started talking about hunter and bo, who went it is not about the stephen colbert thing, which is amazing. when you just sit and see the tent of person he is, he is just genuine. there is nothing else to talk about.

i know my wife will hate this but she works for sandy hook. the stuff he has done for sandy hook is about gun violence. it has been amazing. to a lot ofistening the things he stands for. i know i am being very symptomatic. thank i am more of a thought leader. have three presidential appointee is on each of the presidential economic committee i canld like to think help on talking about infrastructure and free trade and exports. yes, i will help whoever is the democratic nominee to become the next president. let's talk about the fed? betty: we will that is a private segue. we will come back after the commercial break. it is not all politics paired just politics. -- it is not all politics.

big republican debate. we will be back. ♪

welcome back. economists are divided on whether the federal reserve will raise rates this week. policymakers will wait. hasfederate move this month dropped about 30% and lower. traders pricing of a rate hike have pared back amid signs of a slowdown in china. also, a global selloff we have seen in stock market this summer. we are back with wall street veteran robert wolf. he is serving public and private companies. i saw you not in your health --

notting -- nodding your head. i am not so sure they should have done qe3 to begin with. now we have done it, i do not think they should do a trickle they want touse start hiking. i think it would be poor judgment by them to make that move. we have inflation per the dollar is too strong. manufacturing is down. global growth is slow, away from china. global growth in general. see the future forecast, it is under 3%. i just think today, it would be too much of a crop to the system away from the volatility of the stock market. betty: those who argue the fed has boxed themselves into a corner, will that be a bearish sign to some that is are really -- robert: once you start, we all

know you do not stop. there will be an expectation of thearter in december possibility of a whole budget debate in the united states, volatility in the fourth quarter without what is -- what the fed is doing. they have had a few snapshots. that kind of hits the ability to raise rates. you look at inflation, you would say no. you look at global growth and you would say no. yes, there is an expectation but i would say it is totally excited. futures have shown that. i do not recall when the market express a 30% chance that there is a rate hike. i do not see it. the fed could look at

jobless claims, for instance. there at multi-decade lows right now. usually when that happens, it is an indicator that maybe it is time to raise rates. robert: there is no question the jobs market has been getting better. we are still at a participation rate in the low 60's. we are not even near where we were in the crisis. in my opinion, the headlines have been better than where i think we are as a country. betty: can you bring up the financials chart? at the s&p financials, all financials here look at how well they benefited from quantitative easing. i do not say they should not do quantitative easing. i think what they did in 2008 2

2011 was amazing. i would give ben bernanke and a double plus. we were ahead of the entire global market on how we made banks more safe and more secure, and put liquidity in the system. it has nothing to do with where we are today. they delivered their they're actually starting to lend. they are doing less risky work they do not have a bloated balance sheet with all the off market stuff. everyone knows who they are and they are safer. stanley, goldman sachs. betty: you bring the chart up again, you can see they have been dragged down with volatility. robert: there is no is a

nervousness of how you carry a balance sheet. on the flipside, deposits will do better. i actually think they are in a good situation. if we continue to grow, banks will continue to have better capital. stocks will go of. betty: -- go up. to draw you back into politics. i know you talked about infrastructure here you talk about energy eight. robert: and the new joan company has got the largest fia -- faa exemption. not that i'm giving it a plug or anything. say in the next term the democrats take the white house. are you interested in doing something in government to do

something about the economy. robert: no. i am not looking to be in washington. i think business leaders can help make a difference by giving best advice and hopefully formulate public and private partnerships and get that back. thingtructure, the whole -- it cannot be government led. is based on public-private partnerships. i am not looking to go into administration, but i would be flattered to be asked him about it is not happening. great to see you. i played golf with mayor bloomberg but i did so poorly, he never asked me to play and he plays a mile from my house. he is a pretty good golfer. betty: great to see you. just a reminder, we will speak to ray of bridgewater associates

tomorrow in a primetime bloomberg exclusive. the conversation. conversation of one of the world passes top investors. we will be right back after a short commercial break. ♪

betty: migrants, thousands of them are gathered. we will speak with the migration commissioner in the next hour .bout this as matt miller noted earlier, we have seen you are counting down to the fed decision down thursday. matt: we are waiting for it.

but tends to lag is volume. light volume, but we see big games and they have been getting stronger and stronger. as is the over 1%, nasdaq. i'm looking at my terminal here to pull up the imap function of what the s&p is doing. take a look and you can see we have dreams across the board. look in here and pick out sectors that are doing well. i move over here to the white side of the screen and see the sectors listed here. ip is doing well. financial is doing well. you can see which ones are not doing quite as well.

even though, as oil has been having a pretty good run today, energy stocks are not doing too poorly in the sense that crude oil and the ones that are tracking, that are pulling it ground, coming down ofthe last few minutes trading here, still a gain to $44 and is to present per barrel. take a look at energy stocks here. ,ou can see transocean, energy all doing well. more than 4%. take a quicke of look at bonds. the front end of the curve is versusaround a lot more the 10 year. you can see the rise in the 10 year all morning, climbing higher and higher. yield right now.

you see even more volatility, more drops yesterday. thank you so much. now i look at the european market close. i want to bring in mark barton from london. mark: european stocks rose for up,first day, up, down, down day. aboutitial concerns china. china.worry about that they rose 12% in the last month and what a day it was. let's look at big movers. there is a big auto show taking place in europe. the chief executive says the company's growth was measured in china and it will last through

2016. shares up. glencore. i am fixated by the company. earlier, shares fell by 8% to a by 7% -- 77%.wn they finished up by .8%. .ild gyration the german vista -- down by 14 .ercent i want to finish with the stoxx 600. what a strange day. gyrations, call it what you will. stocks finished the day higher. it was not straightforward. not straightforward indeed. mark barton in london. a look at the top stories this afternoon. target is taking on amazon when

it comes to the same day delivery of groceries and household items. they are teaming up with a delivery startup. service willvery be limited to its own hometown of minneapolis. jeff bezos is making a big bet on outer space. they will invest $200 million to make florida it's base of operations. the company will launch a rough -- a rocket later this decade. a reminder, we are 48 hours per or we the fed decision p will have special coverage for you starting at 2:00 p.m. eastern. we will bring you janet yellen's press conference life. -- live. ♪

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betty: still a lot of inferences san francisco, 1:00 in hong kong. mark: "bloomberg market day." this is the "bloomberg market day." . details on manufacturing our out

ahead of the fed's betty: meeting. of .8ty: the rate hike percentages. mark: thousands refugees are stranded is hungry seals off its border with serbia. get the latest on the crisis with the eu commissioner for migration. betty: good afternoon. i betty liu. mark: i am mark crumpton. thanks for joining us on "bloomberg market day." up, the leading index -- the dow industrial is up over 1%. the two-day fed meeting begins this week and lots of people want to know -- is the fed going to move on interest rates?

.8%.&p is up that sector being led higher today by energy and telecommunications. matt miller was telling us about that just a moment ago. the s&p energy index is up .8%. let's move on to the close of oil and goal. -- gold. it was an interesting ride with been having the last couple of weeks. the nymex crude is up 1.7% right now at 44.76. brent crude is up .1%. that spread between denny ti and brent is the nearest we have seen in a while. gold futures are down .4%. and $.90.ng at $1102 betty: retail sales numbers came out, we saw bonds being sold for the two year yield, you can see they're down considerably, the

yield going up and a lot of selling going on. the dollar rallying on the backs of retail sales report, it's that 120 level. for a look at what is weighing down the dow, as well as other movers, i want to bring in matt miller, standing by in the newsroom. the energy index look like it was weighing on stocks. it still again, .8%. but it has come down hard the last couple of hours. we saw that when i pulled up my imap feature as well. another stock that has been a weight on the dow is disney. morgan stanley downgraded disney because of court shaving. you areaving means going to a skinny pay-tv bundle, which means maybe you won't use espn. at morgan stanley are saying 3.5 million people are going to be court shaving in the foreseeable future. 2.5 million of those people will not choose espn for their skinny

pay-tv bundle. my love this new terminology when it comes to the media and cable world. morgan stanley still has a price target higher on disney, 108. it has moved to considerably lower. at a stock am looking at today is fitbit. i remember ever since they filed for an ipo, i was shocked to hear how many fitbit's had been sold. i'm just a shock to see how much more they think this company can do. the stock is up 3.8%. they came out with an upgrade because of what they termed ridiculously fast growth. i pulled up on the bloomberg terminal a look at the fitbit growth quarterly, or sales quarterly. this is 2013. as we get into 2014, big jumps right before the ipo. in the december quarter, it will be a little drop in the third quarter. in december, a huge drop. they are forecasting even

stronger growth. it seems amazing to me because there is so much competition in this space, not only the apple watch, but the jawbone, any kind of pedometer should work as well as a fitbit. i guess the kids like it. stocks rallied today, specifically beer. what is behind that movement? there was a conference that was canceled. people are speculating you're going to see a beer merger. we always like to talk about these companies, sab miller and coors.s -- these are market rumors. , asmarket rumors unsubstantiated as they may be, and as much as i may hate to report them, play a part in the way to market works. that's the reason you see the shares rallying today. matt talksve how about fitbit and getting fit, and then beer right after that. mark: it was meant to be.

matt miller joining us from the newsroom. thanks. betty: will the fed raise interest rates on thursday? mark: if they do, how much will it matter? woo fromwe had david merrill lynch. david: the international events are overtaking fundamentals here, especially with what's happening in china. if they were to hike, i think it's going to be a mistake. from thening us nominee falls as brian jacobson, chief portfolio strategist at wells fargo fund management. a fed rate hike would be a mistake? brian: i would just prefer they not do it. it doesn't matter whether i think it's a mistake, just a question of whether or not they will do it. are.'t think that they i think that based upon the

beige book information that we received, reporting that only six of the districts have moderate growth, that really sends a signal that they are inclined to just wait. when it comes down to it, what matters is the chairs opinion. really in a she is position where she wants to rush into a rate hike. the last time the chair was in the minority was back around 1938. i think there is a good precedent to what janet yellen has been saying. it suggests they are just going to punch this to october. a long look back at the last time we were in that position. so let's game this out a little bit. if the fed decides not to raise rates on thursday, what do you think is going to happen in the markets? brian: i think if the fed decides to not raise rates, we could see basically risk on rally. peoplecommending position portfolios for the head -- the fed toe

take upon his and braced themselves for that october hike. i think we will see yields come back down a little bit. i was really uncomfortable with the drive down and yields ever sense basically august. i'd be much more comfortable with the 10 year treasury was closer to 2.4%. instead of where it is right now. we have retraced some of the movement we've seen since july. position your portfolios to anticipate rates might move back down a smidge, it should be positive for equities. mark: if the fed does pass this week and decide not to raise rates, and they do move in october or later. how will the global markets read that? brian: i think they will read it as a positive thing. the federal reserve recognizes there are risks. it's not saying the u.s. economy is in a bad position. the data we have been getting suggested that the u.s. economy, the domestic side is actually

quite robust. it's doing fairly well. from a risk management perspective it suggests that the fed wants to just wait and buy some time. think back to what happened in 1997. the fed was looking at economic data and said things are looking really good. we don't see any signs of inflation. but maybe it's going to come up eventually. as a result, they raise. by september of 1998, they had to backtrack. i think the international markets look on a very favorably of the fed decided to take a little pause. you can't see this, by one or obvious to look at this chart which looks at the correlation between jobless claims and the s&p. with interesting about this, brian, is that when you see jobless claims in a low, that's when stock markets hit a peak and they start to decline. are at this point now, it's happened already two times before in the last 10 years, we are now at this point where

jobless rates are a multi-decade lows. it looks like the stock markets are peaking. that's usually the time when the fed does raise interest rates. is it likely to follow that if the fed raises rates, this might be the time that they do, the markets will inevitably fall? brian: i think the markets will eventually fall. it's just from which level? until we get 2200 and 2300 on the s&p 500, i'm not that worried. the relationship between initial jobless claims in the stock market is a rather complicated one. we are at multi-decade lows as far as the level of claims. if you look at it as a percentage of payroll, etc. historic lows. necessarily aot foregone conclusion that the stock market is going to drop. you have received a lot of false positives from following that type of signal. i don't think it's reliable enough to really position a portfolio based on. is looking atd

low initial unemployment claims and saying this is a sign that the labor market has shown some improvement. and that's why they will hike at some point this year. i think this thursday is too soon for them. brian jacobson from wells fargo fund management, joining us this afternoon. thank you. at thelet's get a look top stories. in japan, the central bank is counting on a resumption and growth to jumpstart inflation. the bank of japan has decided not to add more stimulus ahead of the doj. the bank sees a gradual recovery in the economy, what the bank won't hesitate to act if prices to rise. all this took place a day before the fed begins their two-day meeting. they decide whether to raise interest rates for the first time in nine years. tough talk today from north korea. said theyn's regime are restarting their nuclear reactor and is ready to use it clear weapons against the u.s. at any time. yesterday they said they are

preparing to launch a long-range rocket. the u.s. warned that would be a violation of you resolutions against ballistic missile test. mark: european car sales bunch -- jumped last month. the spike in consumer confidence pushed customers to splurge on suvs from luxury brands like bmw and mercedes-benz. 8.6% andales increased nearly 9.4 million cars. brightis one of the few spots from makers as slumps in what's hot markets like china, russia, and brazil are set to reduce global growth this year. theyservative group said will spend at least $1 million for a campaign against donald trump. the move marks the first time club for growth will put significant money into a presidential nominating contest. tv ads inwill run iowa. the gop presidential front-runner says the group is bitter because he refused to give them a donation. bernie sanders appeared at a place not known for hosting

democratic presidential hopefuls. liberty university, the christian evangelical college in virginia. sanders admitted he and the crown disagreed on gay marriage and abortion yesterday, but he said that shouldn't and their discussion. bernie sanders: there are other issues out there that are of enormous consequence to our country, and in fact, to the entire world. , we doybe, just maybe not disagree on. sanders drew applause for praising liberty as a proudly religious institution. betty: the number two senate republican wants a special counsel to investigate hillary clinton's use of a private e-mail server while secretary of state. sent arnyn of texas letter to attorney general loretta lynch saying the extraordinary circumstances warrant the appointment of an independent investigator. he said it may be a conflict of

interest for her to handle the investigation. elton john wants to meet vladimir putin about gay rights in russia. he says he received a call from the russian president just days ther elton john criticized country's gay propaganda law. in comments by putin suggesting, sexual's prey on children. no word if the kremlin has agreed to a meeting. that's a look at the top stories. still ahead on the "bloomberg market day," we are watching every angle on the fed decision. with thel be speaking chief economist at goldman sachs. "bloomberg market day," continues in a moment. ♪

betty: welcome back to the "bloomberg market day." i am betty liu, here with mark crumpton. a beautiful day, clear skies in san francisco. with target is teaming up instacart to have same day delivery of groceries and household items. boost as's a major they take on amazon's fresh grocery delivery service. joining us is cory johnson. does this make sense? cory: it's interesting for both companies. site, they get access to a delivery network bits in 18 cities across the u.s.. is an important deal in those 18 cities. but target also gets to be part way of delivering services without really putting a lot on the line. instacart spreads

across the country, they have a bigger geographic footprint. but target partnering with instacart, they don't have to shell out the money to build up their own systems, whether it's the actual team of people to deliver stuff, where the online systems i can be quite costly to develop the seamless system that instacart strives for. mark: amazon is in the crosshairs then. it's interesting for a lot of companies. the big change happen for amazon when they started to pay state and local sales taxes. for a long time they ran their business by concentrating the delivery network in places where they would have to pay sales taxes. thereby lowering the cost of the goods they sold across the country. because technically they weren't being moved from there. when they finally realize they were going to lose that battle in california, they moved a lot closer to urban hubs. as a result, paying sales taxes, but reimagining their business in thinking that delivery could be a core competency of that business. you see startups like instagram

coming into this area and saying we can also do same-day delivery area and like amazon, they are probably working at least if not right close to breakeven, may be losing money on every order. surely there's a lot for that go. for instacart, gives them not just a grocery business at target, which is huge, 20% of their overall business, but it also gives instacart the potential to sell a lot more than just groceries down the line, which is the ultimate corporate ambition. betty: is anyone making money on this? cory: great question. during the bubble, we had caps , publicly traded goldman sachs, twitter's chief financial officer being the table and bringing investors. safeway bought that for pennies on the dime. right now it might expect that none of these businesses are making money. they are all trying to expand their footprint and make money

somewhere day. but we've seen a movie before. mark: what about delivery fees? instagram and target, we don't know what their split will be. whether it's $3.99 for each , but for instagram, could be a way for them to add to the customer list, particularly to get a chance with a partner with target. betty: cory johnson, thank you. mark: coming up in the next hour on the "bloomberg market day," a new report finds when it comes to saving for retirement, women are a lot worse off than men. we explain we return. betty: we take a closer look at the slowing economy of china, and how it could be effected if the fed to size -- decides to raise interest rates. ♪

mark: welcome back to the

"bloomberg market day." i am mark crumpton here with betty liu. betty: google is making its first big bet since announcing alphabet. the company will invest $32.5 million in the insurance start up. the deal is valued at $1.7 million. they signed up customers through online exchanges created by the 2010 affordable care act. the focus on signing up individuals, rather than employers. unleashing a four seat sports car that accelerates faster than a 9/11 and changes charges and the 15 minutes. hits 60 miles an hour in 3.5 seconds. the battery can be recharged stadium percent capacity in 15 minutes. tesla supercharger needs 30 minutes to recharge for about 170 miles of range. cofounder of the subway restaurant change is dead. fred deluca founded the chain to finance his college studies and

eventually wants to grow larger than mcdonald's. subway celebrates its 50th anniversary this year, and has more than 44,000 shops around the world. the billionaire's death follows about with leukemia. fred deluca was 67 years old. that's a look at some of the top stories we're following at this hour. betty: saving for retirement is a challenge for every american. but the struggle isn't necessarily the same. but according to a new report from financial finesse, in order to live on 70% of your pre-retirement income, men are short about $212,000 or more, while women are short much larger $268,000. that's a 26% gap between the two sexes. mark: one of the things that is glaring -- it's literally the elephant in the room -- women in united states of america still make less on the dollar than men. i'm sure that hasn't been to do with it.

to the dollar is the average. women make $.78 to the dollar that every man makes in america. but the rub here, mark, i'm sorry to say is that on average, women live longer than men. so this is an even bigger troubling statistic. because not only do they retire with less money, but they are living longer and it doesn't last them as long. we are talking about these figures, the bureau of labor statistics focused on expenditures for people 65 years old and older. so what we have been seeing, because all this talk about entitlement reform, then you have medicare and medicaid, so security and folks on capitol hill not taking action on that. it seems that now it's become incumbent on individuals to watch their own retirement, to watch out for their own portfolio. and it probably sock away as much as they can. at this point, there are no guarantees.

it will probably be congressional inaction on something. folks are going to have to take matters into their own hands. betty: they are. here's the silver lining. accounts, women are better savers, they like to save money. versus investing, although since they don't invest as much, they lose out on any returns. financialesting how analysts looked at these numbers. they took an average 45-year-old man an average 45-year-old woman and saw how much it would take to retire by the age of 65. they only look to retirement income. if you took into account retirement costs, how much you really cost to retire, men would need to save an additional 270 thousand dollars, women have to save an additional $522,000. that one of the keys is the suggestion that women take the time to focus on your retirement needs early, rather than later.

because that will eventually pay off on the backend. women need to save more than men, and do it faster. betty: that's a big lesson for me. i don't know about you, but i don't think i will ever be able to retire. mark: i wouldn't want to. it's too much fun. betty: i'm retiring from this hour, right now. mark: nicely done. everyone in the control room is like very nice. betty: that's why they pay me the big bucks. mark: betty liu, the segway queen. coming up in the next hour of the "bloomberg market day," will hungry's move to seal their borders cause a domino effect in europe? the european commissioner for migrants. ♪

mark: welcome back to the "bloomberg market day." i'm mark crumpton in new york. thank you for staying with us. pushed with a slump in oil

prices, u.s. shale producers are finding new ways to cut costs. oillers are getting more from fewer rigs. down 59% from the peak, but production is down just 5%. crude coulds says fall to $20 a barrel, but one analyst doesn't believe it. bloomberg he tells thinks the industry will regain its balance. >> i think he would only happen in a true panic and maybe a much weaker global economy. otherwise i think we are in a world for at least the next six to nine months of 40 and maybe high 30's, reflecting the fact that there's a lot of oil out there, the market is just not in balance. other analysts think inventories will try because the price slump will drive smaller drillers out of business. the super pac behind republican presidential hopeful jeb is making a $24 million television .d by it will purchase time in early voting primary states like iowa and new hampshire. it will remain on the air until

the end of the year. the former florida governor is trying to move ahead of billionaire donald trump, and retired neurosurgeon ben carson in national republican polls. amazon founder jeff bezos is looking to the next frontier. his space startup will invest $200 million to make florida its base of operations. the company will launch rockets from cape canaveral later this decade. blue origin says the investment will create 300 jobs. hungary and police in are sealing off the country's border with serbia. we have a live look at the border right now. more than 9000 people are trying and haveillegally, been intercepted in the last 34 hours. hungary is planning to build a fence on its border with fellow eu member romania. germany and other european nations are also tightening border controls to deal with the flood of refugees from syria and from africa. there from live shot

the serbian hungary border where the migrants are gathered. for more on the crisis, let's bring in demetrius ever marvelous, the european -- the wholefrom world has seen these pictures, if seen this crush of humanity as people try to leave war zones and go to countries in europe. can you give us a sense of what it is like on the ground? i'm assuming the pictures don't tell the whole story. >> never the pictures can tell the whole story. one thing is sure, our neighborhood is on fire, and it's expected to continue in the for siebel future. the impact is on your brain now. we are confronted with an unprecedented refugee crisis. this has to be shared, for the

respective human beings. many values and principles that europe has been built on. response to this crisis will define the future of europe. that how confident are you the countries of the european union will be able to reach an agreement of consensus on proposal to relocate 120,000 people? >> yesterday we had a very crucial council of the interior minister's of the european union. we didn't have the deal. we will come back and try again. we made a step forward. have 160,000 persons who need international protection that we are seeking to relocate and give them a new place, so this decision has been made. what we need is 28 member states

to agree upon that. only 24 states have agreed. we have a new meeting on the eighth of october, and i'm sure that the basic principles of the european union and the european spirit will remain. there are two principles, solidarity and responsibility. i hope that it will show that they really mean it when they say it. mark: we mentioned just before we started speaking that hungary is building a fence on this border with romania. ?s this legal dimitris: in europe, we fought in the past to put down barriers and walls. whatever is hindering citizens from moving around is out of our mind. it will not be permitted. we are facing a crisis. what is clear from the country

is that no country can respond to this alone. shouldlateral decision be avoided right now. system that can only function if everyone plays by the rules. germany, they did something. -- theypended somehow brought back the border control on the borderline with austria. as ans temporary introduction to border control. it's an exceptional possibility and so germany is entitled according to the rules. we have to avoid that from becoming a pattern. it's an exceptional measure and that's why it the composer -- and easily put into practice as soon as possible. mark: dimitris avramopoulos

joining us on the phone from brussels. let's get more insight on the refugee crisis. earlier today we spoke with former u.s. secretary of homeland security michael chertoff, he said russia's making the situation in syria worse. michael: we see the russians getting more engaged in syria. being helpful partners in resolving the situation there, they are doubling down with troops and air assets. that's going to exacerbate the refugee situation, which puts more stress on europe. it's also going to create more problems in the region itself. i think the storm is gathering force. i am pessimistic. tom: you are an important voice in america for refugees. i believe your mother was a , you know whatts it's like, your family knows what it's like to show up at the border and ask entry into the united states of america.

or twoly back one generations. would you please explain to americans this morning, if there is a threat to syrian refugees bringing in even a few isis members, is that a legitimate concern for public officials? sure, it's a concern. i do think we have an obligation along with the rest of the world to help genuine refugees, people who are fleeing persecution and violence. and not merely people who are looking for economic opportunity. that we havemean to just open the doors without vetting the people coming in. the reality is we have done a good job now in keeping out operatives from other parts of the world am i want to commit terror act. we ought to find a way to admit more refugees, the president has said. to do so in a way that continues to assure us that we are not admitting dangerous people. chaos, the midst of the

what is the actual process that builds trust in america for the goodwill of bringing in refugees? michael: you have to start the process as early as possible. that means ideally you would do it in place where you have people in the perimeter of syria who are now waiting for some kind of refuge. it means interviewing them in using whatever databases are available to see if there are connections between people that we are looking at a people who might be dangerous. field the is just the experienced agents have when they talk to somebody about what their true intentions are. it's not a foolproof scheme, but it does mean that you can do some kind of evaluation rather than willy-nilly letting everybody in. let me emphasize that the best way to do this is literally in the region. to set up a process there. what europeans are dealing with now is a disaster in which they are presented with people who are at the tail end of having

migrated, and there really is no time to that them. that means everybody suffers. trying to who are evaluate who is coming in don't have the adequate opportunity to do so. a have to move the process to much earlier stage in the journey that many of these refugees are taking. >> it reminds me of the marital boatlift here from cuba to the united states, where we ended up with a whole lot of undesirable people in this country because we weren't able to screen them in the beginning. michael: that's partly an analogy. the castro actually deliberately sent people from the jails. >> do not think terrorist organizations are sending people? risk.l: it's certainly a with not hard to conceive that a terrorist group like isis or similar group would see an opportunity in the flow of people to insert some

operatives. in fact there was a story in the "washington post," today about one of the refugees in europe who was talking about how he likes living under isis in syria. that's a very real risk. it's a small minority to be sure, but we have to pay attention to it. >> the europeans are already there. is it too late now? obviously they can move everything to the middle east again, but with already the people on the continent, is it too late? michael: they are facing a situation where they have literally tens of thousands of not hundreds of thousands of people who have arrived, many of phone don't have a clear destination. you are beginning to see a reimposition of internal border and that's a sign of how fraught situation has become in terms of managing the flow. way late in getting ahead of this problem. it's an issue that should have been dealt with by creating safe havens in syria and iraq, or in

countries that are peripheral. in my beginning processing there. now, they are facing really this issue on the back foot. the former u.s. secretary of homeland security's begin with tom keene and michael mckee this morning. "bloomberg market day," continues in just a moment. ♪

mark: welcome back to the "bloomberg market day." i am mark crumpton. the bank of japan resisted pressure to increase monitor monetary stimulus, instead betting the economy will turn around. juliet filed this report from hong kong. the bank of japan said the central bank will continue with its acute to be policy until the 2% inflation target is stable.

this team resisted pressure to boost stimulus, even after it -- japan'sands economy shrank. a leading indicator of capital spending on excitedly fell in july. the central bank cap to the target of expanding the monetary base at annual pace of ¥80 and stocks close moderate high on tuesday. the shanghai composite index fell 3.5%. investors worry the government measures to support the markets and the economy are falling short. joining me is michael mcdonough. michael, is the government in china doing enough? michael: they are trying. if you look what they are facing, best case scenario for china isn't implementing new stimulus that leads to a quick

rebound. they are just looking to stabilize the decelerating growth. more action is probably going to be necessary. i think we're going to see more stimulus announced there. they are not done yet, but they will continue. mark: the bloomberg monthly chinese gdp tracker according to our survey remained below the government's target growth. the growth rate is 7%, and that's for the eighth consecutive month in august. what are they going to do or have to do to turn things around? michael: there's a lot they can do. one of the old methods -- you always hear there's too much investment in china. you're about cities that built too much. fact is that there's a room for a lot more investment in china. is a lot of bad investment, but they are going to target good investments, and the structure projects, water purification, hospitals, roads, etc. things they need and that will have an impact on productivity and a return to the economy. we talked about what might have an impact.

we have been asking our guests if the federal reserve does move on interest rates this week at some still believe, will that have an impact on china? michael: i don't. this is in my phrase, i think we're about to enter the most dovish tightening cycle we've ever seen. mark: why do you say that? theael: people say what is impact the fed is going to have on emerging markets around the world. we have seen in the past is that markets have performed really well during tightening cycles under two caveats. one being there was a selloff before the fed tightening cycle began. they started pricing that in. we had that happen. we have seen a selloff in a lot of emerging markets, a lot of markets in general. secondly, the tightening cycles have occurred under a backdrop of very strong growth. to 2007, global growth averaged about 5%. looking forward, growth is going to average less than that. we have one of the two caveats.

really what you need to look at is the fed is increasing rates, outlook looks pretty good in the u.s.. global growth doesn't look as good. is going to be a very long slow multiyear process. they don't just want to put a shock in the system. is not going to be 425 basis points in two years. it's going to be 425 basis points over a large number of years. mark: do higher rates automatically feed -- mean falling asset prices? ? fed is increasing rates and they're only going to increase rates of their confident in the economic outlook area it means the u.s. economy is heating up, they expect it will continue heating up in a meeting to eventually slow that rate of growth down a bit. mark: as you know, there's so many americans out of work. is it possible that sometimes we look at these labour statistic numbers and they could be a little misleading? what is the participation rate look like? michael: it is slow. it was going down before the

crisis occurred. we're talking about rated zero versus rates at .25, it's still extremely accommodative. it's not until you get close to 4% where rates become really restrictive. and really start slowing down growth. mark: we have been talking to people leading up to this week's meeting. if the fed decides not to move on rates, what signal does that send to global markets? michael: they are indicating they are not going to rush into things. intends on increasing rates i think before the end of this year. i think they're going to take a assess thelook, situation. they saw the consumer confidence number wasn't quite what they wanted to be. some of the other indicators were soft. there's no cost for them waiting another couple months or another month and seeing what happens. it sends a signal they are being cautious, not that they are capitulating. mark: michael mcdonough, thank you so much. in the u.s., stocks are close to their recession highs.

matt miller joins us with more. looking at stocks at session highs. we didn't get a lot of direction as far as the u.s. economy from the retail sales. we got that empire manufacturing numbers. have session highs, the dow jones adding 237 points. the s&p 500 up one and a third percent to 1978. stocks are doing very well, everything will group on the s&p 500 is rising right now. the nasdaq is doing the least best right now with again of .1%, it's actually positive for the year, and moving up more and more into the green territory. take a look at my terminal, you will see the w.a.r. p function. economiste like our downplay this. it shows the fed increasing rates to 25%.

economists may think it's higher than that, but it's interesting to watch. this was above 50% before the whole chinese crisis came upon us. moved down considerably. take a look at oil. we see gains in oil today, though they have come down a bit. last houre over the or so, oil has come down considerably. energy stocks of come down as well. you still see session highs, other industries have had to pick up the slack as far as making gains and pushing is higher and higher. mark: matt miller, thanks. "bloomberg market day," continues in a moment. ♪

mark: bentley, the iconic british luxury carmaker is treading new ground. company's first foray into the suv market, and it said to be the fastest, most powerful, and was expensive suv ever built.

matt miller said on with the ceo bentley motors and asked about the target customer. >> the very first one we are having delivered to the queen of england, who owns a big property in scotland, and decided to test drive it if you weeks ago. not use it for her hunting expeditions. matt: she own scotland, she can afford it. it is the most expensive suv, it has to be one of the fastest. zero to 60 in four seconds. horsepower, 660 pounds of torque. top speed of 187 miles per hour. matt: who else besides the queen will be able to shell out for this? you're looking at about $300,000. >> starting price of $229,000. you can option it up to $300,000. the clock the cost $150,000, self winding.

>> that's on the extreme end. not everyone is going to do that. tot of our customers own six eight cars, all of them have one or two suvs in the garage already. this is the bentley suvs. it gives them a chance to replace one of those other ones and have a bentley suv in the garage as well. you have first mover advantage because there are no competing suvs on this level. we are quite excited. the car represents a first for us, it's the first suv that bentley has ever made, it's also the first suv in the ultraluxury space. it combines all of the features you expect from a bentley. it's a small handcrafted luxury on the interior and ultimate performance. matt: how do you market a product like this? polo matches in yacht races? exposure, but it's

one-on-one marketing with the people that you know can afford it and have the affinity. matt: you will be making 5001. action is up this year. 3500 this year. ,> it will ramp up to 5000 year that's about the production capacity. we generally get one third of the worldwide production from the u.s.. matt: that almost doubles your production. that really adds a lot of volume to your sales. bentley worldwide sells between 11000 and 12,000 cars per year. it adds a platform, and that allows the business to stand on broader footing. can: you're going to have a a greater at -- a configuration app. is the person who actually pull the trigger on this going to be messing around with an iphone app to design it? >> i think so. it's very exclusive.

doesn't offer you -- it does offer you a number of options trade over 90 colors are available. the app gives you an opportunity to play with the car just the way he wanted. matt: orders are already meeting supply. >> there is very strong interest. we think for the first 12 months, certainly -- i don't want to say sold out, but we have very strong interest. we think we have the first 12 months covered very quickly. mark: bentley ceo michael winkler. we'll be right back. ♪

mark: it is on :00 a.m. in san francisco. >> this is the bloomberg market day. mark: the countdown to the fed meeting continues. we will see how nervous it is

making the markets as the so-called day of reckoning is fast approaching. >> a new world for oil. they explain how the market may finally find balance. mark: it is one of the most valuable art collections in the world. look at eli burroughs new exhibit -- ♪ mark: good day from bloomberg world headquarters in new york. i am here with olivia sterns. >> let's get straight to a check of where the markets are trending right now. you can see all the major benchmark averages up by about 1%. solid report on retail sales showing them growing for the second month. iem