doing right now? we will talk about the day after fed today. challenges being felt well beyond the middle east. what they could mean for the u.s.. is tech biting the hand that feeds it? matt: good morning. pimm: welcome to the bloomberg markets. we are 90 minutes into the trading session. selloff today, been lacking in bonds areplace rate rallying following yesterdays no

decision by the federal reserve. they cannot manage to raise interest rate, and that says something about the global economy. a little bit of selling in .he short end of the curve matt: stocks in treasuries. new summaries of the day from the bloomberg terminal. a measure with the economy may look like in three to six months rose slightly in august. the leading index was up 1/10 of 1%. it has 10 components, including building permits, stock prices, and average weekly hours. a prominent goldman sachs executive says do not focus too much on increases in interest

rates. they said rates would have to move too much higher before major concern about equities. i would say that many investors have been making too much of it, quite frankly late this increase, whenever it comes, would have already been widely telegraphed rate what we need to think about is whether that are long-term opportunities in the financial markets. the fed wants to make sure that average americans feel better than they do now. the u.s. banking system is much safer than it was. he spoke this morning saying that banks have more capital and are much more diversified than they used to be. but he is concerned about what happens when the economy worsens. >> what happens when you have a really bad environment?

banks will be much more restricted in their ability to stand against the tide. be madet of that will before then. matt: another one of his concerns involves treasuries. some traders have never been invented environment were true interest rates are rising. way atob cuts on the johnson controls. they make building controls as well as auto components. they could cut as many as 3000 jobs over the next year. that is less than 3% of the total workforce. the company hopes to save about a quarter billion dollars by these moves are the obama administration is easy more economic sanctions on cuba. companies are offering telecom and internet-based services that

are setting up shop in the island nation. the former lehman brothers chief executive has sold his estate in sun valley. it is a record for a u.s. house sold at auction. matt: at least $20 million. pay 35 million dollars for that place. i would get closer to 54 that historical -- 50 million for the aspect.al pimm: what women want, tesla and designed.

plus, we will talk about developments in the middle east syria, migrants, refugees, we have an expert on this human catastrophe. those stories and more coming up on the bloomberg market day. matt: janet yellen says the decision not to raise interest ises was a close call, but kept central bank from pulling the trigger. she still expects rates to rise by the end of the year, but the question is will economic conditions be that much different in order to do to rate increase? is that an accurate statement about the u.s. economy? >> i think the economy is doing ok. we have been talking about it for six years. we're still in the middle of a decade-long economic recovery. i do not think the underlying

business cycle has changed that much. that is a scattered logic came out after the fed give the rationale for not raising rates rate i think wears some logic that can be tightened the rate a lot of the volatility is indicators that got a little bit muddled. matt: even if you take out the global aspect of what is going general,na and asia in you still have a situation in the u.s. were unemployment is at 5.1%, and there is an incredible amount of slack at leads to no wage increases and that leads to know inflation. how can you raise rates in a where itation targets, looks like unemployment still needs to drop another point before anything needs to move? >> there is the unemployment rate, which is the headline that we all see. and then there are other indicators of the labor market that she is looking at.

that gives us more slack than the headline number would suggest. is 0%, not buy that it close.is the logic of the fed was more influenced by international conditions than we would have inspected. the influence not of just the economy, the tightening of credit and financial conditions globally. i think that the global conditions references were much more surprising. we thought it would have been more domestically focused. let's description of you make your money when you buy your house, not when you sell it. you have to be very careful about your entry point and be thoughtful about this. if you had new money to invest, where would you put it? >> the frustrating part of the u.s. market, the cycle is good.

valuation has been a challenge for a while for certain industry groups. 12 looks attractive for the price that is now going forward? >> you look at that and equity space. i would probably look at more u.s. focused, more domestic think growth will outperform in the near term of value decisions. pimm: technology stocks? >> you have to be very careful. the problem globally is that valuations are rich in quality. eliminate world for countries like tesla and facebook and a variety of firms keep putting up numbers which really disconnect from traditional valuation metrics.

>> i think the market is generally rich in the united states, any rate environment, whether it is december, october, it is going to be a little less accommodative than it was. o go global.g i think that your, relative to the united states looks more .ttractive to matt: i have just pulled up the stock 600, a very broad index of european stocks. we are looking at a pe of 20.7. here in the u.s. it is 17.5 on the s&p. angry. see the stoxx 600

basically, 20.7 is where we are. if i pull up the s&p you can see we are at a 17.5. we have had a steep drop, obviously. well,edded in that as future earnings and immature economic cycle. europe is bouncing off the bottom. we would be qe until further notice. matt: qe not coming back here? >> not for the foreseeable future. but until further notice, they will have a qe program. coming up on the bloomberg market day, imagine a mobile world in which you could browse the internet and do it in peace. the new app. ♪

matt: welcome back to the bloomberg market day. pimm: emily: let's get an update on what is going on in the markets. we have it excel of going on. still deeply in the red for the wake of the averages and's concerned about the global economy. i want back on some individual members as well. performer isorst happening even as we see gold futures heading for their first weekly gain this month. today.her 2% the company announced it had completed a billion dollars share sale and it may share another million dollars, which dilutes the value.

they have been battered more than any other stock by the decline in commodity prices. declined 65%. the 12.5ll the way to year low that it reached in august. it has rebounded since then by about 40%. it is off of the extraordinarily low level where an additional selloff today. this is backdrop for that selloff. one of the other stocks that we are watching, that is the drug maker merck. some data yesterday shows eli lilly's journey of kind cardiovascular for the high-risk patient. but is something that they may be designed to do. there's concern being expressed by analysts of what this will mean. one of the stocks that is

bucking the downtrend is adobe. is up about 3% right now even though it fell in the after-hours session. company added subscribers for cloud services leading earnings-per-share to beat estimates. for 684,000.rs that was the addition to about 5.3 million. thank you. look at thetake a stories crossing the terminal right now and starting with the irs. taxnext stop for them is cheats in belize. the irs suspects americans may be using this account to dodge taxes.

procter & gamble breaks ground tallness the largest and the entire history of west virginia. they are expected to create hundreds of full-time jobs. it is only the second factory to be built in the u.s. since 1971, before i was born. and 11 house republicans are sidestepping the party line and calling her action against climate change. they were guys like humans have pulling back on global warming. pimm: while everyone was watching the federal reserve, apple rolled out its new operating system. it has a special capability. it was received so well that three of the top 58 downloads on the app store today follow in the footsteps. could this be a new feature?

bad news for google, facebook. from sanns us francisco. special about ios nine? if you look at the free apps, you will see a dominance ifthe kardashian family, but you look the paid apps and where the money is, a remarkable thing happened this week. as blocking technology apps garnered three of the top five spots in the best-selling apps for the ios. technology, that keeps ads from showing up on your phone across all kinds of apps. this is a grave concern because name your company of choice, but their plan some day to have revenues in a mobile environment is advertising. apple is introducing technology

and allowing for technology to keep those ads from showing up in phones, and people are flocking to the even as we speak . , and aood money for them lot of focus on how they are going to work and how cool they were, or how powerful the camera was. the technology of this new ios could have a dramatic impact on businesses across all of mobile computing because it takes away that key revenue source that we are seeing from users that they once the technology. matt: i love apple. i hate ads. i am happy that they are doing this. but i use google chrome is my web browser because i think it is better. it seems like google is not helping out with apple. they are giving developers codes to get around this as blocking technology.

apple clearly recognizes this is an arms race. rather than incorporate the technology, the open it up so that other developers can try to .op each other allowing them to write their own one of each try to other. when you look across the internet, you try to look at who is at risk here. because a lot of companies depend upon a lot of revenue. that would include twitter. that would include linkedin. but it also will include some companies that serve up those fuel.ompanies like rocket

they have startup companies have these ads. they have mostly collapsed since their ipo. they are in march over -- trouble over the last six month s. this company could be at greater risk going forward, if the ads that it it is serving could not be seen by users. pimm: what about those companies that use subscription models? cory: it will be helpful for them of course. others want to embed the ads and made much more user-friendly , things like instagram or facebook for example. the ads are so embedded into the use of their that it is not easily blocked and taking the ads out of facebook would be pretty hard. that is it make difference. ,acebook might add some value

because blocking technology will be having a hard time. pimm: thank you very much. coming up on the bloomberg market day, what is the ax factor that seems to attract women to certain types of automobiles? tesla thinks it has the formula. ♪

pimm: tesla's all electric

automobiles have made a big national markets they were introduced three years ago. morehe brands have been ith male buyers than female buyers are they are rolling out a new model for female purchasers. buyers% of the initial of model s were women. of carore than 50% buying decisions are made by women. i thought it was interesting that so few went to the model s at first. pimm: they went in and asked a focus group. safety and having the third seat for children and for extra storage were much higher than performance.

they wanted reliability, safety. matt: for men, those things do reliability,ist maybe. but safety is not with your as concerned about, and certainly not the third row. pimm: $85,000 is the price. ever check outve a model s on their configurator, you can never get below $100,000. pimm: $100,000 for this suv? bellshe put on all the and whistles. that is the perspective of a male buyer. maybe if you did a female -- on the model s has a third row as well. not a lot of people know the is. you can see seven people in a

model. s. there is that capacity, but it is not as spacious. ism: because of the way it designed, it is so much lower the center of revenue feels lower, c do not have the way when you're driving to the. suv. matt: performance and space. happy weekend. pimm: still ahead, middle east mayhem. we will talk about syria migrant and the crisis facing europe. ♪ ♪

(ee-e-e-oh-mum-oh-weh) (hush my darling...) (don't fear my darling...) (the lion sleeps tonight.) (hush my darling...)

man snoring (don't fear my darling...) (the lion sleeps tonight.) woman snoring take the roar out of snore. yet another innovation only at a sleep number store.

bloomberg asked longtime bond fund manager about the federal reserve's decision to hold off .n a rate increase the >> financial conditions are the key priority and the strong dollar of wreaking havoc on emerging market economies. ill gross said artificial rates have -- stilllly increased bill gross said rates have artificially increased prices. bloomberg news reports exxon is meeting with small oil producers .n the basin the collapse in oil prices has forced many drillers to either shut down their rakes or partner with companies that have deep pockets, such as exxon mobil. we go to the luxury apartment a lot.

that is what we are starting to see here in manhattan. zeroingtruction firm is in on smaller apartments with relatively lower prices after seeing expensive units sit on the markets for many weeks. stories of the morning. the markets are closing in europe. .et's go to ryan chilcote brianna: i want to kick it off with the bond market. take a look at a u.k. yields, down 11 basis points. that is the biggest move for yields in nearly three months. this is really a global bond rally. the stoxx 200. this is the european benchmark it. the equity market down close to this is where janet spoke

after the close. basically what you had in europe was equities opening down. decided it may have been a little overdone at the end of the day. the dax down by 3%. only greece was up. nearly 1%. look at those greek banks. hard to say they are on fire. up 14.3%. investors are really optimistic because all of the parties are promising to implement just stare to deal. -- not exactly what we are used to seeing in greece.

ryan chilcote reporting from london. coming up on the bloomberg market day, the federal reserve, yes it held off on a rate increase. we are going to try to take a look at what the head of the federal reserve's decision-making prowess. and chinese president g zheng ping will visit the united states next week and bloomberg television will air a special focused on his trip. liu will be joining us for a preview. michelle meyer will weigh in on the federal reserve's non-decision to raise interest rates. those stories and more are coming up on bloomberg market day. soon direct talks will begin over china's buildup in syria. up itshas stepped military support for bashar al-assad in syria's civil war.

most military talks between the united states and russia were stopped after russia annexed crimea from ukraine. understanding i want to begin the former u.s. ambassador to syria and israel. thank you very much for being here. expertiseof russian into syria, that has changed things. had a longtime military political relationship with syria going back to the cold war years. is putinappening now is making a decision from all these reports to amplify the russian presence in syria. >> is this a coastal base for >> theynavy ships? attach a greater deal of

importance to that. it is a play by putin to ingest hymns -- to inject himself into the future of syria. his major motivation is the threat of radical islamists -- radical islamism. the greatest threat he sees his radical islamic movements in the southern borders of russia. he has a problem in chechnya. he considers the president of .yria as a secular leader >> if you can, add a paragraph having to do with the refugees and people fleeing the civil war in syria and the pressure that puts on european leaders. >> a humanitarian disaster. the situation has devolved into

such chaos. al-assad may be elements -- not owns but controls 25% of the territory of the state for syria. what has happened, you have four midian displaced syrians. , andy, lebanon, jordan then all these others we are seeing. the hundreds of thousands seeking to go to europe. it is an outright civil sectarian war. whoral of these migrants are leaving from the middle classes -- the very rich have departed.

getting on these boats. you saw that iconic picture of the syrian deutsche round on that turkish coast. this is pressuring our european partners in a way we have never seen before. >> wealthy arab nations, are they being pressured to accept refugees? there are billions of dollars of money that can be used to help these people. atthey are throwing money the problem. we are the largest donor of the syrian humanitarian crisis. the gulf countries -- gulf countries, they will have claimed in their countries they

have thousands of syrians who come there to work. they are not refugees. thesesue is whether countries should be accepting refugees. >> i want to thank you for spending time with us. the former u.s. ambassador to syria, a former u.s. ambassador and head of the rice university's baker's interest to -- baker's institute. as we know the federal reserve didn't move interest rates yesterday. what is the federal reserve synnex move as we going to 2016? a look with a were porter -- with a reporter roundtable.

>> this is the bloomberg market day. let's take a look at some of the top stories we are following on the bloomberg terminal. the secondt will be national election in eight months. greek voters will decide whether to stay with the party and prime minister alexis c burress -- alexis tsipras. the two parties could end up in a coalition government. volkswagen wants to keep you from being hacked. the automaker is teaming up with german companies to sell information technology security next year. might be security is becoming more important to automobile makers. it starts -- it wants to start making smart phones on wheels. the vatican isn't happy with the white house is guest list for pope francis's visit.

it transgender activist and a man who has been criticized for her views on a portion -- on abortion. those are your top stories. held off onreserve raising interest rates, but they retained the option of raising rates in the future. the participants cited economic developments around the world and how that would affect the u.s. economy. what does this mean for the decision-making process? we brought in our editor, michael mckee, and chief u.s. economist carl riccadonna. we keep saying september. and then we say december.

michael: the real question is how do we know, how do we decide that it is even a live meeting and a possibility. they didn't even give us a decision framework. janet yellen repeated what she said about we want to see progress and the labor market because that will help bring up inflation, and yet they forecast that even though unemployment is going to go down, inflation is going to go down. pimm: we are going to talk about inflation in a second. i want your thoughts. policymakers have an inclination to get off the zero bound before the year-end. we know where we need to be on the labor front. we have to watch leading indicators of inflation, like

the pace of overall economic activity. it is not what the next report tells us, but what the feds a horizon isth over a really. it is going to dip down through year-end. if the economy is going above trend, the inflation will occur. we watched the fed us beaked -- een now pimm: just to point this idea, when those numbers and being in line with what the fed wants commodity going and to pick another economic series? carl: know, a lot of people say the fed keeps moving the goalposts.

when the facts change i change my mind. the phillips curve has shifted. the old relationships between unemployment and inflation has evolved. it has changed from where we were in the greenspan era. >> this is something that comes out of a puff of smoke. you described this plot that each of the dots represents. notable feature is everybody's looking for fewer rate increases. there was a real focus there. somebody had a negative interest rate. of this is misinterpreted by the markets. of it is not a forecast the u.s.

economy is going to need. participant is mariana from the minneapolis fed. he is retiring. this inflation is so much of a danger that we are not going to get out of it given the monetary policy stance. it's not a forecast, it is a prescription. you want inflation to go up, this is what the appropriate setting for policy is. people say he is joking, making a mockery of this. this is where i see the appropriate setting of policy. we should have raised

rates today. we need to be much more dovish than we actually are. u.s. economist for bloomberg intelligence and michael mckee, our economics editor. paying --esident gigi president xi jinping comes to the united states. the host, betty liu. my colleague will be here next to give us a preview.

pimm: president xi jinping will make his first state visit to the united states next week. he'll will meet with technology executives in seattle as well as political leaders and washington dc. what is he going to be looking to achieve? i want to bring in that he lived.

you were in beijing last week. i know you had some interviews. what was the mood? this was the first state visit by chinese president gigi paying. they see this as significant in changing the course of u.s. chinese relationships. when he came and visited with jimmy carter. this is an extremely important to visit for them. pimm: cyber security, building artificial islands in the south china sea. >> as you mentioned we went to beijing. he is a state counselor. he was a former u.s. ambassador.

can find a comparison to his role in the united states, he is like john kerry. he is the main person on foreign policy. he will be traveling with the president here the u.s.. we talked about a variety of issues. hear what he had to say about the union -- about the economy. >> they are having some ups and downs. -- a stockexchange exchange on markets. given china's economic development, given that it is a developing country, some movements on the stock exchange should not equal the

whole picture of the chinese economy. up -- betty:eople a lot of people believe the chinese economy is growing. he says the chinese economy is growing at 7%. pimm: the fact he talks specifically about the stock kind of thing that you would expect a secretary of state to start? betty: this is much more important than china. market ish the stock something like 1% of the entire gdp in the entire economy, it cannot be it nor that the entire world was watching in the shanghai composite. you happen to be australia or any commodity producing nation -- affects every single part of china.

we will have much more about interview. pimm: is sure to watch betty liu's special. it is entitled behind the wall. an interview with one of china's most senior state officials. it premieres 9 p.m. eastern only on bloomberg tv. it is time for today's options insight. let's go to julie hyman. julie: let's take a look at what stocks have been doing this hour. we have seen the fed induced step -- fed induced selloff. stocks are bouncing up off the lows of the session. fromng me is dan denning chicago. dan, we are seeing this selloff on the fed. marketsthe options the fed decision?

dad -- dan: we saw the s&p down earlier in the day. we were still seeing those futures holding up pretty firmly. i think we do have quadruple today. when you you do see us move , that couldkes exacerbate and move later in the day. we have some options that were not valued and maybe fully valued. we will have to look for that later in the day. julie: i think it can sometimes create an increase in volatility.

i want to turn to your trade of the day. shares, they are more than 25% so far this year. there are plans to spin off for re: in 2016. -- spin off for robbery -- spin in 2016.ri i think there is an interesting situation taking place. and trying to unlock value the leverage chrysler. i think those two things alone play well. call spreadat a looking into january 2016. there is an increased probability of expected value. nice participation to the outside. ultimately when you look at the valuations and deleveraging that think it wille, i

benefit fiat chrysler moving forward. marchionne has been pushing for -- do you think that holds the company back at all? dan: the question is is the spinoff going to be taking place in january? i think ultimately the move that will benefit fiat chrysler moving forward, sergio marconi has a plan through 2018. i think ultimately an increase in positive value here looking forward. julie: thank you so much. more bloomberg market day is next.

pimm: it is 9 a.m. in san francisco, noon here in new york, and 9 a.m. in hong kong. -- and 9 p.m. in hong kong.

policymakers may wait to raise interest rate. and the next fight is the looming congressional shutdown. john boehner demands funding be stripped for planned parenthood. betty: and we will tell you why the suv model x is a key part of this strategy. pimm: good afternoon, i'm pimm fox. that he: let's take a look at how markets are trading on this midday. the fed coming out surprising some. the markets byin deciding to stay on rates.