david: from bloomberg's world headquarters in new york, welcome. how strong is the u.s. economy? interview with john williams, president of the federal reserve bank of san francisco, just moments away. stocks are slumping with the s&p hitting a three-week low as surge and fear is back in the market. investment opportunities in pakistan, the country has not yet been upgraded to emerging market status. our guest is the former prime minister of pakistan. breaking news, the governor of the bank of japan is in frankfurt right now, saying that they are closely walking -- watching the impact on prices and will take additional steps of needed. speaking with reporters in

germany. let's check on some other first word news. mark crumpton has more. mark: american -- an american servicemen killed in iraq has been identified as an navy seal. he was killed during an attack by the islamic state outside the city of mosul. it was the third death of an american servicemember in iraq since the us-led coalition wants to -- launched its campaign in the summer of 2014. the united nations security council has unanimously approved a resolution demanding medical personnel, hospitals, and facilities be protected against violence and attacks. the resolution was drafted by five councilmembers. new zealand, spain, japan, and worldwide. .- uruguay >> something is deeply wrong. tolanations ring hollow parents burying their children and communities pushing the

clause to collapse. mark: the international head of doctors without borders criticized counsel, saying that four of the five permanent members have to varying degrees coalitionsated with associated with a tax on health structures over the past year. nearly all the detroit public schools are closed again as mass teacher sickout overpay continue for a second day. the district is projected to run out of cash by june 30. teachers who received pay over 12 months instead of during the course of the school year will get checks this summer. students missed class today. joe biden will be attending the university of answering a graduation ceremony. as will donald trump. but they will be there as parents and grandparents.

flame is in brazil. the brazilian olympic committee president carried the flame in a lantern as he walked out of a plane. they received the lantern at the presidential palace, igniting the journey around the country. each torchbearer will run about 200 yards. the summer olympics begin august 5. global news 24 hours per day, powered by our 2400 journalists in more than 150 news bureaus around the world. back to you. lookinghecking markets, at the major indexes, the dow is down 6/10 of 1%. 15 points0 is a down at 2066. the nasdaq, 34 points down. , energyat sectors here received the biggest laggards. consumer staples are up by 1/10 of 1%. checking oil ahead of the close

in about 25 minutes, crude is down 3%. selling right now at 43. let's head to the san francisco bureau and joined bloomberg radio where kathleen hays is standing by with john williams. kathleen? to welcome our bloomberg television audience to our exclusive interview with john williams. welcome. >> i'm the president of the san francisco fed. kathleen: which one did i just say? >> st. louis. impersonating other fed official could get you in real trouble. [laughter] here we are in the beautiful bay area. jumping right back in, in your most recent speech in march you

painted a picture of a growing use economy with 2% gdp growth at least this year and confident inflations targeting the end of next year. you emphasized that eagerness overseas is not decisive for the u.s. economy. with all of that in mind, were you on board last week with the fed decision to not move on interest rates? i was. we are in a data dependent mode. we want a good reading and understanding of what's happening in the u.s. economy in terms of growth, jobs, and inflation, but make sure we have a good read on what's happening globally because it affects the u.s. economy. i am a supporter of the decisions that we made this year. welso support the statement put out there. i expect to be raising the rates gradually over the next couple of years due to the strength in the labor market. david: how are you looking -- kathleen how are you looking at the economy might of that

figure? i know that your team has discounted it and analyzed it. you have looked at the seasonality in those first quarter month -- first-quarter numbers for many years. your economist has argued that if you account for that, growth is probably closer to 1.6% in the first quarter. hasn't that statistical anomaly been fixed? david: they have a lot of people -- john: they have a lot of people working on this issue of residual seasonality in the data. as you mentioned, this is an anomaly we have seen for many years now. my view would be more consistent with what i see as the underlying trend. 2% gdp growth is what we saw last year. kathleen: personal consumption

managers came in on the weak side in the first quarter. is there a risk that you that theother signs u.s. economy actually lost momentum in the first quarter and that 0.5% is in such an anomaly? your average growth, this is a pretty weak start, making that 2% harder to achieve. john: this is another reason to be cautious, positive or negative, in the first quarter. i want good consumer spending data in the next few months. signs that that anomalous reading really was anomalous. i do tend to focus more on the employment data. strong through the latest data we have seen, we are going to get some more soon as well. when you look at job growth and other indicators, the labor

market continues to improve. do take a pretty strong signal from the employment side. not just gdp. which tends to be subject to these revisions. as we look ahead to the next meeting. obviously everyone is. kathleen: so it -- john: so my. [laughter] kathleen: what do we need to see ? strong jobs growth without inflation picking up for a much. what does john william's have to see in june to say -- yes, i'm arguing for being on board for the rate hike? john: a continuation of the progress we have been seeing over the last year. underlying measures of inflation moving generally up towards 2%. i'm not expecting jump, but to be on the right trajectory consistent with my forecast over the next couple of years. i want to see continued good job gains.

for a continuation of what we have been seeing. obviously i don't need to see a strong continuation of what we haven't seen. kathleen: the status quo will be enough? john: for me it would resolve the worries about q1 data, that it's the right commitment. this uncertainty abroad and in financial market turmoil, we want to make sure it didn't have a bigger impact on the u.s. economy. a good number of jobs, gaining improvement in the economy, good signs of inflation would enough. kathleen: inflation has been undershooting for a long time. looking at inflation in the forecast that has retired?

that's right, as long as it's consistent with moving towards 2%, that would be enough . you've mentioned undershooting inflation for quite some time, but in terms of thinking seriously about what's happening, and terms of monetary policy, remember interest rates are still very low. i'm not talking about having one interest rate increase in the next few months or whenever without making tight monetary policy, but it is stepping back a little bit from the very accommodative monetary policy. it's about pulling back on the accommodation we have had in place. did you know market expectations are a little bit out of sync with the fed again? you had people like larry think from black rock and just goodman -- just goodman and double line talking about one interest rate increase this year, if that. you set even a few weeks ago

that even three rate increases are reasonable this year. what is it you see that markets don't? what are the markets missing? first of all, the markets are not just one person. millions of people are involved with different views. looking at the data from the markets, what you see is bimodal distribution. a lot of people think that the modal or baseline cases, the ones i have laid out with unemployment coming down and joe -- good job growth moving back, they see this in the survey of professional forecasters, from my own colleagues in the forecast. there is this other part of the distribution that i think of as concerns about asia, europe, japan and the rest of the world, whether is this downside scenario where global growth really slows and that's a big shock. is obviously priced into the market, the possibility of a negative scenario.

that we should be gradually raising interest rates this year is based on the notion baselineollow this scenario. the data continues to come in and be on the good track and under those conditions we should raise rates. clearly the downsize risks, if they really do happen we see negative effects in the u.s. economy. markets trying to balance these two different scenarios and come to their best estimates of what we should do. you know, again, i answered your question really is my baseline scenario, which is pretty optimistic. on track, the june rate hike is a likelihood in your view? want is an't likelihood. otherwise we will get a lot of data between now and then with good discussions, but in my view, yes, it would be appropriate given everything we

talked about to go on that next step. a lot can happen between now in the middle of june. kathleen: that's for sure. what do you make of the slowdown to manufacturing in china and in the u.k.? we had mixed numbers earlier in the week and one of our own key manufacturers at the institute for supply management headed back towards 50. does that give you pause? to look at the data and and analyze it carefully. the story out of china for the last couple of years from the manufacturing economy has been moving more towards consumer goods and services. we have seen a kind of sequence of disappointments around chinese manufacturing data that i don't think really over flex the overall economy so much as they are really moving their economy from one kind of focus to another. i expect a continuation of weaker readings from china. consumer spending

and other indicators. in terms of the u.s. the manufacturing sector has been clearly hit by the fall in oil prices that cut back on drilling , oil, and those activities, and obviously the strong dollar has affected the manufacturing sector. has been fairly neutral. not that it's contracting or something, but it is growing modestly. kathleen: one of the things that a lot of fed officials have downplayed is the weakness in the strong dollar. they are transitory. have you know? what if they are not? they have been holding inflation down for a while. one of those objectives is setting bad inflation targets. john: to clarify, i don't view the oil prices is transitory, but they're a fact on inflation is more transitory. we are seeing that with prices moving up and down. but we are not seeing any obvious signs of movement with

major moves passing through on court underlying inflation, which is kind of this -- the underlying affect. right now i actually see oil stable,ore or less moving up a little bit. just with time. the underlying inflation in services especially has been moving up. again, i'm pretty confident we are on the right track. kathleen: ok, we're going to conversation with san francisco fed president john williams on "taking stock." thank you to our tv listeners for joining us today. david: thank you. up next, we had from san francisco to los angeles and the -- milken it institute global conference. our next guest will have opinions on how to find returns

in a very low yield market. ♪

david: this is "bloomberg markets." i'm david gura. let's go to the milken conference in los angeles area scarlet fu is standing by with david hunt. scarlet? scarlet: yes, david hunt is with me. iny investors are risk off the first quarter. but pgi and in a manner of speaking double down -- pgim double down on risky assets. david: we do take these

opportunities when we feel that the market has overreacted to news or overestimated a recession, which we felt very much in january. while the market was nervously moving out of a range of risk assets, we moved in. if you get tenure view on these things, we like high-yield. we moved back into equities in a selective way. we even moved back into emerging markets. for us if you are willing to not be buffeted by these short-term moves, they are a nice buying opportunity. buffeted by short terms. i have heard that come up again and again. give us your read on what the catalyst for the volatility may be? it could prompt people to pull out because of sharp moves. david: they do and unfortunately i think the way in which the economic setup is for many hedge

funds, as well as for long only we will see many of these air pockets and changes in short-term volatility than we have in the last of years. our expectation is for higher seetility, but we don't that is fundamentally changing the economic picture. a fairly low growth model along scenario remains our case and we will use those opportunities to buy in. berlet: we shouldn't panicked that the next time there is a big risk off moment? david: not unless there is really evidence that the economy is slowing down in some more fundamental way. otherwise a lot of this is very sentiment driven and that is probably not justified. scarlet: how have you been adapting to the fallout from negative interest rates? $8 billion at less than zero. scarlet: -- david: i think you

have to put it in a bigger perspective. we are halfway through a major deleveraging of the world economy. we didn't just have a recession, a kind of garden-variety three to five year business cycle. we actually had an every 30 to 40 years deleveraging of the balance sheets around the globe. we are halfway through that. we are not really surprised that rates are low. we predicted that three or four years ago and we are sticking with our lower but longer interestn around rates. i will say, i don't even think that we saw that there would be as many countries going to a negative interest rate as there have been. our view is that it is unlikely to be terribly effective in driving more stimulus. we would rather see some of those political ammunitions turned towards other types of reform so that begin more structural reform in the economy. too much effort has been placed on monetary policy at this

point. scarlet: monetary firefighting, really. you said pension funds have to think about getting out of government bonds. what is the first coat -- first port of call after government bonds? david: it's about being realistic about what can be expected in terms of long-term returns on assets classes. because my biggest fear is that we have not yet really internalized overall what it means to be only halfway through a major deleveraging. long, slowg to have growth with low interest rates for the four seeable future. -- were seeable future. if you figure the best the you're going to do in the u.s. is 2% on a 10 year with 5% from the equity markets and a bit better than that in real estate, you need to take that into account when you set your asset allocation parameters and what

you can actually return. we spend a lot of time with our clients actually trying to get them to take the bold step of bringing some of the expectations down. scarlet: is it working? david: in parts, and in other places not so much. it's very appealing to have other kinds of investors coming in and saying -- we can just add leverage, find ways to get you 10%, 12%, 14% on it. we don't see many asset classes out there right now that are going to do that. we worry about the fact that people are unrealistic and creating risky behavior in the way that they are putting money to work. scarlet: what is a reasonable return target, then? thed: we would save for next 10 years, it depends on how much you leave in government bonds. from many countries you know, you have to. or in the u.s., we would be somewhere in 6% to 7% and that would be on the high-end. scarlet: 8% or 9%?

we would say that that is wishing for a world and we don't see enough evidence out there. we do think that that is what is driving some of these risky big shifts with a into alternatives that we are worried are not ultimately going to end up generating the returns that they promised. scarlet: do you see a level of urgency needed there? >> in some cases. i do think that what was fascinating last year was when the new accounting regulations came out for how you account for the actuarial tables, it is fascinating. it did show that many corporations, even some who thought that they were doing this well, probably were 5% or 6% to low in their estimation of what their real -- real liabilities were. what's reality?

you got to get numbers to catch up to reality and then formulate an investment plan that works from that. i do think of that was a corporate phenomena. we're hoping that begins to .uild scarlet: is there anywhere that you see true value? treasuries, how much farther can they go? related toties as value, they are fully priced. a 4% 5% dividend yield in the stock market does look so bad. now in the yield but equity markets.

for us, we looking for types of investment like real estate. scarlet: david hunt, thank you so much. .avid: thank you so much, david that was scarlet fu and david hunt. we speak with the former prime minister of pakistan about investment opportunities in that country. 4 p.m. eastern time don't miss our exclusive interview with jack lew, joining us in los angeles. ♪

♪ this is "bloomberg." let's start with headlines.

mark crumpton has those from the newsroom. mark: today's indiana primary is the one thing that stands between ted cruz and plunging off the cliff, according to ted cruz. if he loses donald trump -- could be all but unstoppable. the latest poll had mr. trump with a double-digit lead. innwhile the democratic race indiana is much closer. hillary clinton has a commanding lead over bernie sanders in the number of delegates. foreign corporations with scaled-back plans to invest in the u.s. if donald trump becomes president according to a survey conducted for 80 carney. they found it the election of a populist like bernie trump and -- or mr. sanders would prompt more corporations to scaled-back outlays. in ireland, ed mckenney ninth have to wait another week before

he's confirmed for his second term as prime minister. he's lost three votes in parliament since his coalition was defeated. last week the two biggest parties reached an agreement, paving the way for him to lead the minority government. he still leads the support of independent lawmakers. the hit musical, hamilton, grabbing a record-breaking 16 million tony award nominations. the hip-hop flavored biography of the first u.s. treasury secretary was nominated in virtually every category. the tony's will be awarded june 20. global news, 24 hours per day, andred by 2400 journalists 150 news bureaus around the world. david? kathleen: let's take -- david: let's take a look of the biggest movers, starting with raw sugar. according to people familiar with the matter, the eu has eighth -- members

-- member states about copper, falling again on does -- on the concern that metal is weakening after sluggish manufacturing reports from the u.k. to china. in oil, wti crude dropping in prices, settling $43.55 per barrel. investors are looking at data showing verizon stocks by -- the rising stockpiles of the highest level in 80 years. turning our focus to pakistan, in a new book entitled -- banking to politics, an insider's account of running and working in one of the world's most challenging places. he spent 30 years at citigroup, where he rose to the job of executive vice president. i want to welcome the former prime minister here. let me ask you, first of all in the wake of the release of the panama papers there have been calls for the current prime minister to resign.

are you one of those calling for his resignation? shaukat: no, i'm not, because we don't know all the facts. holding her company overseas assets is not something unusual. how the assets were acquired and what the source was, that's something that needs to be looked at. but i don't think we should make too much of it. thature the family knows they've earned a lot of money in business dealings overseas were several years and have had enough resources outside pakistan and this is the right way to structure it. let's wait for the facts, though, and not prejudge anything. much of your book suffered -- centers on the relationship between the u.s. and pakistan. there have been calls in congress not to fund an f-16 program to pay for the jets to go to pakistan. you had ahead of the foreign

relations committee saying that they need to do more to fight those networks. can be done to bolster and increase the strength of the relationship? shaukat: the pakistan u.s. relationship has been complex for a long time. is very transactional and it burns very strongly, even when there is need for both countries to be together. especially for the united states to get help and support from pakistan. when that is not needed, pakistan is sometimes forgotten. the most allied allies of the united states. cito, ain sent out, non-nato ally of the united states, and very much a sanctioned ally. it's a complex relationship. i think that the relationship has to again find a new balance so that we can help each other in what isr part

clearly a complex part of the world. pakistan believes in peace. pakistan believes in having harmony with all of its neighbors and maintaining dignity and sovereignty. i'm sure the united states believes the same. we all have to work together. we may not agree on every issue but we must create a situation where the two countries worked closely together. pakistan's location is pivotal for south asia. if the two countries work together, they can be a catalyst for change and a catalyst for peace and better security. one of the biggest threats that we face is extremism and terrorism around the world. pakistan has played a major part, and will play a major part to see how this can be handled, managed, and reduced. david: the pakistani economy has been growing. you contribute some of that i'm sure to the price of oil.

how does this country attract more private investment going forward? >> pakistan shaukat: -- pakistan -- shaukat: pakistan is a market of 200 million people. they are talented and have all sorts of skills. we have always attracted a reasonable degree of foreign investment. we give a level playing field to everybody. the other thing is the country has been reforming. the reform process continues, governments have come and gone. we don't do you turns every day. u-turns every day. despite extremism and terrorism having an impact, a negative impact in pakistan, foreign investment still comes in because the returns are high. it is a country that is growing. the market has a lot of room to

still grow. the population has spending power. all of those ingredients are there for foreign investment to come. the multinationals that are there, they are looking to expand of the opportunity arises. i think that pakistan is an attractive destination that provides a good enabling environment for anybody who wants to make money in a country that is liberal, open, and reforming by the day. david: what does china see in pakistan? shaukat: it's a very strategic relationship. we have been close to each other . you may remember that when the u.s. wanted to open up their relationship with china, pakistan was the interlocutor. that was a few decades ago. we arranged for a meeting and that's how the doors opened for them to meet with the united

states. pakistan and china are now looking at what we call the one road initiative, $46 billion, if i may. this is to build connectivity between the countries. it is not just knowing connectivity between the countries, but between the region of south asia to the middle east through china. it will provide a rompuy -- a road link, a rail link, and what i call the digital highway. linkages through telecommunication. to get this progress and prosperity, if you can achieve greater independence, more trade, more investments, you will see peace in the region. this is one good recipe for development and growth and also ensuring peace. it will create, the new opportunities it will create are not just a road. you know that when the road is built, you open new towns,

industrial estates, new demand, economic activity. i think that this is a holistic concept. the chinese initiative, which is called the chinese pakistan will lead toiative tremendous job creation and an increase in production and i think it's an -- it's a win-win for all sides. it may go much beyond pakistan also. pakistan will be a conduit for china to access parts of the middle east and beyond into africa also. through the port of wobbler, which is already there with chinese help, being expanded. we will have warm water access. china will have warm water access down to the coast of africa. we are very bullish about this initiative. we believe this could be a game changer for pakistan and for the relationship between china and pakistan it will only get stronger. lastly, pakistan is still

regarded as a frontier market. what would it take to get an emerging market destination from msci? shaukat: even as a frontier market we have our stock exchange attracting a lot of money coming in. if we get to that index it will help, but that to me is less important. more important is the fact that markets look at pakistan as a country with potential. the market looks at pakistan as a very good destination for money coming in. the karachi stock exchange has a very good track record of moving in the right direction. i think that pakistan belongs in the msci index. as the markets get more confident in the way we are going and what we believe in, what the reform agenda is, that's just a matter of time. i think that pakistan will remain a very attractive destination for foreign and

local investment. david: thank you very much for your time today, shaukat aziz, former prime minister pakistan. coming up next, michael eric to discuss the local investments on his radar. ♪

at david: the milken conference, we're standing by with ben. for standing by with us.

your firm's them for private equity, but the truth is your vast majority of assets under management are in credit? michael: that's right. approacht integrated to the liquid and illiquid markets. $35 million. erik: our pe the new banks? pe firms the new banks? they are.n some cases it has shrunk 70%. erik: erik: erik: erik: erik: weather is no market price in the reference. exactly. if you look at the regulatory framework, there is a general derisking in the system and many firms like aries are coming in to do that. erik: you talk about liquid credit.

you talk about self originated. canerms that everyone understand, explain what ares is doing to lend money and to whom. you think about what a bank used to do before the financial crisis, you had banks across the country where you would go to get a loan. the majority of the banking assets are now in the hands of four large banks and a lot of that origination infrastructure for things like cash flow loans, specialty asset-based loans, and infrastructure, have moved out because they are not economic anymore. the kinds of companies you are typically serving our? michael: small business pre-revenue venture companies looking to raise capital to grow through a 500 million or billion dollar enterprise value company going through some kind of acquisition. david: -- erik: one of the things that we learned after the crisis is that banks misplaced balance sheet expenses.

how much more expensive is the credit the you are providing that it might have been if the banks were still in that business? michael: it's interesting, the way i always thought about banks is that they are very procyclical. they will take money and what they don't want to put it out. when you think about the bank return you actually have to look at when they are making the loans and why. generally speaking, throw the 20 years i've been doing this we price our assets at 350 basis is higher than what someone could borrow from a bank. cost that the borrower can bear because the banks are not giving them the types of loans. i think it took the difference between actually getting the capital or not. but you are going to have to ask them. erik: should the middle market, these companies you are serving,

look at dodd frank as a on their business? that's an interesting question. i think that saying it's a dodd frank issue simply minimizes or dismisses the issue. a year ago you probably had 25 regional banks extending credit to middle markets in california. they have now rolled up into one and can't actually go get the credit. what dodd frank has done is expanded the types of capital that it's getting made outside of the banking system. but this has been an issue going on for 20 to 25 years. erik: is this what congress intended? i know it's a pejorative term, but a shadow banking industry? i like to talk about unintended consequences because it is tough for me to get into the mind of the regulator, but i think it rightfully so they are

trying to simplify the banking system and as a result, by definition there are certain things that banks used to do that they aren't going to do anymore. harry's does a lot more than just this kind of lending. for some people it seems a bit schizophrenic. on the one hand you lending money for a long time to companies. and on the other time you're waiting to play upon a turn in the credit spike. michael: i think a part of this is understanding where you are in the cycle and how to invest. one thing that people don't spend a lot of time talking about, the analysis you go through to buy a company is similar to the analysis you go through to look at viability and cash flow through enterprise value. it's not of big contradiction to change it a little bit to say -- mi on lender or an owner? how actively is aries putting michael: to work in distress energy?

weour private equity fund came in with a senior lender with equity rights to help recapitalize and oilfield services company. the big issues there for us or opportunities are that the banks again are underwriting reserve base revolvers, creating a shrinking liquidity opportunity for those companies. john: how long can that last -- erik: how long can that matt -- cannot last? michael: we are starting to see the beginning of the opportunity develop. erik: mike, thank you ray much. david, that was michael arougheti. david: thank you so much, erik. stocks poised for their third drop in four days. the s&p 500 poised to close at a third week low. julie hyman has more in the spider sector report.

julie: i'm specifically looking at oil and gas equipment companies. oil and gas equipment specifically they are down 4% today. accommodation of oil prices being down with earnings related news from these companies. list, halliburton and baker hughes, canceling their .cquisition and then the companies came out with earnings. the first quarter loss widened with customer slashing the budgets in half. it's interesting the approach that each is taking coming out of this canceled acquisition. on the one hand they are changing their strategy and pulling back on the pressure pumping business dramatically. basesl exist in only two and saying that they will be expanding in areas where there are holes, with selective acquisitions. the two of them seeming to take divergent paths. seems like investors are punishing them both.

even the ones with good news in the industry are falling. superior energy was upgraded to a by. the analysts said that the shift in strategy that this company had done could expand a fracking business and look for acquisition. as you can see, the shares are down 5%. oil pulling back down with a weekly inventories report tomorrow and a projection that there will be a build in inventories that will be one of the things putting pressure on inventories. something else investors have an about is illustrated by the chart here, a levinsohn 61. we have seen this thing rebound in wti. we talked a lot about it this year. huge recovery. looking at the five-year futures contract, pricing out the wti further out, we have not seen as much of a recovery in some analysts are saying that we , moresee more fracking

rigs coming back online, keeping a cap on this recovery that we have seen in oil prices. that certainly speaks to all of these oil services companies and their trajectory over the next few years. absolutely. as we head to break, a look at the nasdaq down.

david:david: this is "bloomberg markets." time for look at the bloomberg business flash. a judge has approved a request tom the facebook what'sapp

suspend the service in brazil for 72 hours. the court originally shut it down after the company failed to comply with an order to turn over data in a criminal investigation. solar city says they are selling revenue from rooftop solar to john hancock, planning to raise $227 million from the deal. they maintain ownership and will still be responsible for servicing them. fiat chrysler has reached an on selft with google driving cars according to people familiar with the matter, who say the deal could be signed as soon as today. it is based on the chrysler pacifica minivan. the first phase of a joint project to create autonomous vehicles. a big blow to apple's plans to go after price conscious consumers in india, however jacket the request to import and

sell cheaper, refurbished iphones. wouldsay that the move lead to a flood of refurbished electronics and defeat the program to encourage local manufacturing. that is the bloomberg business flash. coming up in the next hour, kleiner perkins partner ellen howell discusses her new venture one year after she lost a .iscrimination lawsuit that interview is coming up next. here is a check on the markets, looking at the nasdaq, down at 4773. 17 points at 2054. the dow, down. ♪

david: welcome to "bloomberg markets."

from bloomberg's world headquarters, good afternoon. i'm david gora. jury -- energy shares are the hardest hit. , fromlair joins us bright's to the threat of islamic state. speaking out. she talks about her new advocacy group one year after losing her discrimination -- gender discrimination suit. we are one hour from the close of trading. julie: stocks are continuing their downward march. at this point, we have a lot of pessimism around the globe. we had disappointing manufacturing data from china and the u.k.. that