markets" on bloomberg television. ♪ vonnie: we are going to take you from new york to london to brussels. stocks and commodities ending their running streak after investors await the next week's fed decision. and the brexit vote in two weeks. and george soros is said to have made many large bearish investments. mark: mario draghi gets invested of -- aggressive. the ecb will do whatever it takes to jumpstart europe's recovery. but will the strategy prove risky? vonnie: we had exclusive interview with jack welch, of ge. corporate leadership and much more.

about 30 minutes into the u.s. trading day, let's go to the trading desk. julie: after this three-day rally, we are pulling back, not helping. we are have got bearishness, but it was the trigger for what has been a healthy rally. the s&p 500 rose or to its record closing level. -- closer to its record closing level. imap.get a look at the there are various places in agreement, utilities, staples. financials are down as a group, which continue to see a pullback in interest rates, which we will get to in a moment. materials and energies also pulling back after we had something of a commodity recovery earlier in the week. oil prices in particular are being hit. crude oil down 1.4% after it also had rallies for three

straight sessions, still holding above $50 a barrel however. some money flowing into gold. copper futures falling as well, 2.1%. how is that feeding into stocks? tech energy is what we are watching, down 5%. it was downgraded to underperform over the rbc. there are opportunities to add value in the commodity market, but they were tougher with this company and others. banks are also seeing selling today. wells fargo, jp morgan, all lower. the a correlation with the yields. get the 10 year -- you look at the 10 year, it is the lowest since february. what is what we have seen around the globe. talk more about

that in a few moments. safety,ou want sovereign bonds are going to the japanese yen today, which are catching up as well. 1% versus the japanese currency. mark: stocks are down for that first consecutive day after rising for two straight days. one industry group is rising from the stoxx 600, real estate. interesting note today from citigroup. 28%ain's biggest bank downs in the last year, even more if the u.k. votes to leave. , primarily also down because of week earnings -- weak earnings. they have not taken into account the so-called exit -- brexit.

since february, since the seven-year low, the index has risen by 14%. the u.k. trade balance today through off a surprise because u.k. exports rose to the highest level in three years, britain shipping more to countries outside the eu. a 9.1% in exports led a trade deficit, $3.5 billion. imports jumped 4.5%. this is the last piece of trade data ahead of the referendum, two weeks today. as if you needed reminding. as a statement from the big bond markets in europe, from the u.k. 10 year and the german 10 year. the u.k. 10 year could fall to 1% in the event of the brexit voting.

a legal group says this, there is a flight to safety even assets today. vonnie: we'll keep an eye on that throughout the moment. we have more from the newsroom. two suicide bombers killed 31 people and wounded dozens in iraq. the deadliest attack was in baghdad. a bomb exploded in a commercial place in a predominantly shiite neighborhood. other suicide bombers struck north of the capital at an army checkpoint. the u.s. military said the second carrier group nearing the mediterranean to bolster operations against the islamic state. since thesecond time iraq invasion. they will join the as is harry truman. -- uss harry truman.

the washington post reports the former detainees from guantanamo have been taken from attacks in afghanistan, killing six americans. detainees are no in the custody of foreign governments. in the custody of foreign governments. two palestinians opened fire in a taliban shopping district, killing four israelis. they were captured. israelis deployed more troops and the west bank and limited israelis traveling abroad during ramadan. journalists in more than 150 news bureaus around the world. world index isi down for the first time in six days after reaching a six-month high. the s&p 500 is falling after edging closer to a record.

by the stocks reporter danny berger. criticism, the idea was that george soros is back in his office. because the parallels with previous currencies? we saw that know pair back on his equity exposure. how was a visceral image of concerned he is with the markets. there certainly has been fair trading. even though we are less than a percent away from all-time highs, short interest on the s&p 500 has remained elevated. looking at that, looking at various sentiment indicators like how much stocks have been bid up, and on top of that the news from george soros, people think it is time to take profits. vonnie: it is difficult to know

which investors are concentrating on what because there is the brexit vote, the fed, and they are all intertwined. reporter: that is part of it. the investors, the bearish ones would say, why are we going higher? there is so much uncertainty. and the volatility indicator has been relatively low. people have start to put bets in. volatility picking up. like, the fed,is the brexit, certainly there will be volatility of him point. -- at some point. it is designed to swing three times as much in verse as the vix. that had record highs right now for total assets. investors are piling in to the u.k., saying there will be a

shift to how much volatility we are saying. looking at that and short interest, there will be no surprise that we are seeing some of the gains we of come off. -- we have come off. mark: the breadth of the rally these are charts i made earlier. i could have included l sorts of assets, but i tried to keep it general. index,omberg commodity emerging-market currencies, all asset classes for us today, hoping rising -- what does that tell us? that is so interesting. if you are an equity investor and you do indeed have a viewpoint there could be turbulence ahead, and you want to hedge, where'd you go? all the asset classes you pointed out have been correlated , have kept rising. where do you go to hedge?

and the more exotic quarters of the market, people have started , whenn to, because soros he pared back on his equity investments, he went into gold. but the price of gold has been bid up as well quite a bit. it is making hedging difficult. mark: we will see you later and battle of the charts. coming up on bloomberg markets, straight from the gas, check wells of general electric. the economy and business. we have a bloomberg exclusive. ♪

♪ mark: live from london and new york.

vonnie: you are watching bloomberg markets. we have an exclusive interview welch.ck he is sharing his business philosophy and strategies with executives around the world. he joins betty liu for a wide-ranging interview. betty: jack welch how the management institute, nice to see you again. let's start on politics. we were just saying a moment earlier. we had this interview with donald trump. as usual, has a lot of things to say about a lot of stuff. one highlight out of that was him talking about a potential running mate. everyone wants to know who could balance out some of his other aspects. he said he will not pick anyone from wall street. leaning towards five candidates of politicians, two from the

military, who do you think you should go with? jack: i have no idea. betty: what would you like him to do? jack: a serious player, someone with stature, great respect, someone that can be looked at from a general election standpoint as a very good candidate. very sensible, broad-based candidate. betty: you think you should pick someone from the political arena, a longtime politician? jack: i am not so sure. just a strong person. someone people have great respect for, that is what i want. someone that is really competent. betty: what you think of a possible trump presidency? can you get behind that? jack: i am behind the republican candidate.

betty: any republican candidate. jack: any republican candidate. i can't have eight more years of court,o jobs, supreme advanced regulation -- none of that. i don't want eight more years of this, what we have now. betty: you mean with clinton. jack: that is what she is running on. that is her platform. i don't want eight more years of this. nothing but slow growth, median incomes are down, health care costs are going through the roof , because of obamacare. regulations are exploding. we haven't had a 3% economy in this administration. betty: and yet, -- jack: don't go to unemployment. betty: i do want to go down therw.

--there. is a the real unemployment hell of a lot higher. 5% is anyone that says dummy, he said. jack: i will give him that. betty: you solely the jobs numbers are cooked? jack: we will see. there are all kinds of stories about the homeowners, with his or to investigate -- you can go a thousand on this. alldid that 60 day period of a sudden surge? it doesn't get you anywhere. the facts are, we don't have a healthy economy. stamps,more food deficit almost doubled. this is horrible. betty: the democrats would say it would be worse under a

republican. jack: i am sure they would. why wouldn't they, they have nothing to stand on at this point. when the ceo takes over a job, a ceo set the tone. if you did a most important issue is climate change, all the minions that work for you will go out and start and get things fixed around climate change. if you do something else, they do another direction. i don't believe climate change is the number one issue. betty: what is? jack: an economy that is healthy, gets people working, more people dignity, off food stamps. an upwardly mobile society. betty: you think president trump could do that? jack: i think the policies that are out there, if you will support them as paul ryan as laid out, i think we have a chance at a golden economy. get the rate cuts back.

we have a regular morning with jack perez, he wakes up every morning wondering what else can i regulate? epa, she is at the thursday. we have epa rules that are so crazy, it never stops. ozone, keep going. betty: then you have regulators saying if they were not there, look what happened on wall street. look at what is going on in valeant. look at all these crises that are happening. regulators are not there. jack: that would have paid for its sense. trump.back on i don't want you to avoid this one. are you going to back -- jack: i will vote for donald trump. absolutely. betty: ok. jack: not a question.

i will vote for any human being against hillary clinton in this election. betty: what we do to support him? when you give him money? not a big money guy in politics, i have never been. betty: you think donald trump is good for their publican party? -- the republican party? jack: we will see. judges in less about indiana. i was we would not lay out -- anybody could beat hillary clinton, but we are trying not to with some of these states. betty: how do you propose this against hillary clinton? do you think he will win? jack: he has a better than 50-50 chance. today he has less than 50-50 chance. betty: what should he do to turn that around? jack: show the american people how he will create jobs, a better economy, and a better

life for all of them. issues. get back on isis versus ignoring isis. build a military back. keep talking -- i hope he announces a serious cabinet soon. until you will not wait after the election to name the cabinet. you are worried about the vice president, issa point people that he has to appoint people that make middle-of-the-road issues comfortable, comfortable. issues so many integrity , she cannot walk with them. betty: he is to get people around him that are serious running the country. back on the economy, after seeing the jobs report on friday, this economy might be in danger of slipping back into

recession? jack: absolutely. it is very tough. thething that bothers me private energy company i work for, we have 26 companies. lies to slowitual growth. -- a bit to allies -- habitualized to slow growth. i ask for what is really happening, they say it is much better this month. we are up 1%, 1.5%. that never happened in a flourishing economy. we have never been there when the wind was at their back. betty: they are making do with a low growth environment. as you mentioned, you are graduating your fifth class at

the jack welch management institute. i imagine these folks have so many management fact -- questions on their mind. that is why they are seeking education from your university. what is the biggest management issue on their minds? talk about the problem of building great change, getting people in the same direction. it is clear to everyone getting every mind in the game is the way that, the winning answer. year, 1200y fifth students, we have 500 graduates so far. they are all hungry. they are working adults, all online. .hey want to progress we'll accept people who have jobs.

we are out to make them grow in their economy. betty: and and then they want bigger jobs in their sector. them areefully 70% of getting jobs while they are in school. about theanted up to hot management topics these days. one of them is compensation. how do you compensate employees well? is there a difference from 10 years ago or 20 years ago because we have millennials, things are being automated? jack: i don't care what you call yem, generation x, generation -- betty: there was a story about how ge is scrapping and he will pay raises because there is a different type of workforce in this country. does that make sense to you? jack: sure, you paper performance -- pay for

performance. we have always done that. you don't go lockstep. betty: at about the entire annual pay raise system. sometimes we did it in 18 months, it was always a spontaneous. we did annual review, but that was a formal system. if you don't appraise employees every day, every week, they are not doing their job, they don't know what they stand, you should not be in charge of anyone. betty: it is part of that look of compensation. revisings looking at the five-point scale system or ratings you had put in place. does that also make sense to you? jack: i never thought so, that was what in place by my successor.

betty: the rating system? jack: never had it. betty: does it make sense to change compensation? jack: compensation should be vibrant and alive. you call in, fill out a form that says your name, address, birth date, your parents, mother's maiden name, you should be told here is what i like what you are doing. here's what you need to improve. so do that, they will work for me. sometimes people are blown out of the water. you give them a raise right on the spot. you don't, this is just talked among hr people. betty: before we go, only a few seconds, do you like what is going on a ge bank now? jack: i have been retired for 16

years. i have not been back to the office one day. follow ge anymore. i have a whole new life and companies integrate school, the jack welch management institute. i have a great adjuration coming up this saturday, and that is what i am all about. -- graduation coming up this saturday. betty: he is the chairman of the jack welch institute. more coming up. ♪ e

♪ vonnie: you were looking at a live picture of new york city. we bring you "bloomberg

markets," i'm vonnie quinn. mark: it is sunny here as well. this is "bloomberg markets" on bloomberg television. let's check in. , has more from the newsroom in new york. reporter: on the verge of endorsing hillary clinton, president obama will pay to be cy. ernie sanders' candida this is aimed at unifying the democratic party ahead of the battle with donald trump. he had to the white house under intense pressure to drop out and clear the way for clinton. he has vowed to keep fighting for his movement. house speaker paul ryan unveils the latest part of the republican agenda focusing on national security. this called on increasing military strength and doing directed to islamic terrorists. he is a talked about securing the borders, but no reference to the wall between the u.s. and mexico. the u.s. house is expected to vote on a bill to manage puerto

rico's debt crisis. the legislation would create a financial control board to manage a restructuring of the u.s. $70 billion of debt. this is scheduled for july 1. puerto rico must make a $2 billion payment to bondholders. san francisco is preparing for a different kind of earthquake, a fiscal one. this is to ensure it can withstand a shock like the one that rocked markets into this a. the city is one of the hottest economies in the u.s., they are haunted by memories of the first.com bubble. com bubble. the city council has approved a on sugary drinks in philadelphia. millions are trying to defeat this. global news 24 hours a day

powered by 2400 journalists in more than 150 news bureaus around the world. mark. mark: investing billions in new china locations, shanghai disneyland set to open next week . in addition to the music part, they are -- amusement park, they are also producing more films in the region. we sat down with bob iger earlier today asked about the continued expansion in china and some of the challenges in entering the market. entering the market has challenges, any market has challenges. there are regulatory issues. making a decision on how to enter, we felt the best way was with a theme park. theme parks are expensive, about $3.5 billion, so it is a big bet on a big market. it represents not only how big of the entrance into this market but the potential to deliver great growth for the company

long-term. reporter: the timing was interesting because of this focus on driving the consumer the consumer element of the chinese economy. was that good timing, good foresight on your part? >> whether good or bad, you are building something for the ages. it is not about the economy today was the circumstances today, it is about where we see long-term. some of it unknowable of course, but it is a bit on a market and a true belief on a market. in terms of what is going on in china that looks to our event, clearly establishing a move from mega manufacturing to a more service economy is eerie important. -- very important. we'll set contribute, it is one of the reasons we got this business. we create service jobs, and the

missions status message it sends. reporter: you are looking to make movies and china? something underway already. we have a lot of development activity right now to make disney branded films in china. reporter: are you able to tell us which partners you have been looking at in china? >> i am not able to. only because i am not 100% certain what we have politically said -- publicly said and not. we are very far along in terms of developing ideas, concepts four films and identifying talent already to make those to. reporter: can you give us clarity on the timeline? >> i cannot say specifically. reporter: within the year?

>> we will not have a movie released in a year, but at least one in production. reporter: as you look over the portfolio and more widely at the global economy, how do you gauge where things are going? >> i am not an economist. i just run the little old walt disney company. clearly what we have seen in europe for the last few years is cause for concern. there is not much cause for to be overly optimistic there, but businesses are doing reasonably toughn -- paris is doing right now. generally speaking, business across europe is ok. i would not suggest we have great optimism in the near term. asia, even though there has been a slow down, we still see growth and opportunity for the company.

we talked about the movie business in china, but other parts of asia, southeast asia, recent discussions about indonesia as a huge growth opportunity for the country. we think there is a number of markets in asia even with an economy not as robust as it once we, including india, where still have a lot of opportunity. the united states is quite solid. while it is not exuberant economy, it is a healthy enough for the nearnomy term and your secom. mark: bob iger, walt disney chief executive. we are hearing more from the interview later on. bonnie. vonnie: we had to the russell's economic reform and with germany's it deputy finance minister. the take on the european economy and the chances of brexit ♪.

♪ mark: this is "bloomberg markets. " let's get a check on the european equity markets. we are roughly 50 or so minutes away from the end of the thursday session, second day of decline. after two days of gains. all classes seemingly running out of steam. the stoxx 600 down 3%. industry the declining of the stoxx 600. real estate was the best and only industry group in the green, trading high today. energy also basic resources,

telecom, probably the most excitement happening in the bonds in the currency market. the yield bond for the u.k. 10 year is at the lowest level ever for the third consecutive day. year, .03%,an 10 also at a record low, closing in at a negativity, adorning the likes of japan and switzerland. to bond yields are up negative. never be some achievement. -- that would be some achievement. vonnie: abigail doolittle has the latest from the nasdaq and manhattan. >> the nasdaq is down 0.4%. one of the worst performers from the nasdaq 100, shares of bed bath & beyond. in sympathy, which was a dismal first quarter review.

bed bath & beyond is hardly a luxury retailer, but it does show investors are trading indiscriminately. there is a 10% interest on those shares, so they may be using this as a reason to increase short positions. and helping the nasdaq today, the top performer, american airlines is up. the company did report capacity growth by 1.4%. traffic is up 0.5%. they are seeing revenue per available seat miles declining 6.8% in the second quarter, but they reaffirmed full-year views. some investors say fare pressure and wage pressure concerns are abating. but a bloomberg analysts has a view saying that the look is unchanged, suggesting recent fare increase in it by jetblue is not helping the second quarter. he does nothing to will help the full-year.

these shares are down sharply on the year. vonnie: even though they are higher today. was the chart saying of a reprieve or a turnaround? reporter: it says this is just a reprieve. we see a long-term trading range, this is really from the company's ipo, long-term trading range, uncertainty between buyers and sellers. but the sellers really pushing right through the buying support, suggesting the sellers way, and the likeliness will continue. below $30 per share. it could be a brief reprieve. something in line with george ferguson's bearish or cautious view on american airlines. .ark: let's turn back to europe let's go to belgium. matt miller is at the brussels economic forum. he is joined by the german

deputy finance or -- finance minister. matt: he has been a fascinating day, truly experience -- truly exciting experience. your panel was the best of the day so far. the audience do have a lot of questions. all day and talking to commissioners -- i am talking to commissioners asking for more spending from richer countries like germany. there is not a pothole in the country. there are no lines at the airport. and i went to the customs office last week and did not wait a minute. there is no infrastructure spending to be done. more on theld be federal project, finance. anything that has gone through the planning process, literally ready to be built, increase investment spending within the balanced budget we have right

now. the infrastructure is in a situation where we need improvement, but it is not that bad we could spend billions in weeks or months right now. expect moreople investment spending in germany. it does not bring back growth. matt: as an american, i can tell you your infrastructure is basically perfect, relative to what we live with. and you had 0.7% growth in the first quarter, fastest in two years. why do you think the commissioner wants to put the money to get growth from other member states? jens: i don't know. washington and brussels, whether discussions, everyone expects us -- we do already [indiscernible] and if her structure growth, 3 billion euros. -- infrastructure growth, 3

billion euros. so we do need more structural reforms. stimulation to bring in [indiscernible] we need to get more private investments. with germany with rising rates and salaries and pensions, growing to e-cig demands, it is not -- domestic demands, it is not about the budget. it is a signal for the rest of europe that it can have growth and the balanced budget. so we are willing and ready to talk about structural reforms, but not about deficit spending. matt: what about structural reforms outside of germany? that is one thing mario draghi and of the commissioners are calling for. other commissioners are calling for. they are not seeing taken to task to for that. they are not be held accountable. it has been amazing

structural reforms, pension reforms, they were not easy. it is something that needs to be done, but they have already done a lot. seeing the project we are at now , we will decide in july if there is punishment or any kind of measures that are taken as of the deficit. -- we don't apply the rules that we had when france and germany just dead. that is all this mess started. something needs to be said about the wrong time. in terms of spain and portugal with the deficit. spain and greece have met the demands of the euro group. milosevic will get their three billion euro -- it looks like

they will get their 3 billion .uro debt removed also this luxury airport that will add 40,000 jobs, are you happy with this trajectory? jens: yes, we have to bring that confidence in greece that people are ok. they build up companies, buildup sales, people are employed. we are always focusing on debt limit talk about greece. that is one points. but the other thing is about growth and confidence and trust and the development of greece. did quiet timet -- need quiet time. trench pay off the next and go step-by-step to bring this growth. matt: they are pushing for something of debt restructuring, i haircut.

is it not likely? framework, ithe is easy to be done. but we don't think [indiscernible] more [indiscernible] are necessary right now. over alltually taking the debt of the europeans. we need growth. as soon as there is growth, the relative debt situation for greece will improve. you do not see it in ireland, but this could go down. we will discuss more. matt: let me finally ask you about brexit. .erkel has been quiet on it she did make a few statements last week. how important is it that britain stay in the eu from your perspective, the german perspective? jens: they are an important part are in the europe -- partner in the european union.

when it comes to the reform of budget, the union without the united kingdom would be different. would benited kingdom different as well. so it is up to the britons to decide right now. if they want to be part of the family. so they need to reach an agreement. if you are a part of it, or if you are a neighbor [indiscernible] matt: it has been a real pleasure talking to you. back to you. matt miller with the german deputy finance minister. stake with, lots at a possible exit, including something you have not thought about, like the u.k. famous pork

pies. ♪

♪ mark: the brexit vote is a couple of weeks away. this could have many political and economic social implications. what it could mean for the pork pies and real ale, we have the chief critic at bloomberg. you must read this story. should we be quivering in our roots about the thought of losing protected status with some of his interest is -- industries? staffordshire ale, my favorite. we need to protect what we can oysters andsuch as

things like that. mark: but as you say in your story, the village is not allowed to produce anything. >> it is believed to come from a small village in cambridge, but it is made traditionally in three other counties. richard, if it did happen and britain were to wto itthere was to be would come into effect, some kind of limit for what can come into the country as opposed to substitute pork? >> the thought of that. it is limited to eu countries, so it would be lower if it did leave the u.k. cambodian peppers are affected under the eu legislation. that means these things is sold in the eu must be a designated origin.

it doesn't mean they have to be an eu member. vonnie: to the other countries -- there are meet markets like british pubs the world over where they make pies, but is it a general commodity in places like france and germany? >> it sounds unlikely. in france, it seems unlikely. off do to keep our hands the stilton. it is good for consumers to know that a product is produced where it is supposed to be produced. mark: how does good stuff a chain protected food status? >> there a three different kinds of status. it is judah for graphical gasquet's geographical partners, -- it isers sardines geographical partners like cornish sardines.

scotland.rade up to ,ark: and are the sales boosted you have this stamp of approval to boost sales and jobs in the area where the foodstuffs are made? >> it protects the commodity. british foods begin popular internationally, it seems unlikely it would stop people in france or china. vonnie: tell us what you are hearing from restaurants and chefs and owners of. generally food prices would go up. also if partly that but you go to a restaurant in london, it is unusual to find english waiters. lots of people are coming from the eu countries. dynamics to lots of consider. you can read richard's article

and all of the articles on bloomberg, including travel, watches, dining and others. just go to bloomberg. vonnie: pork pies -- mark: coming up on the european close, we will cover all of the issues concerning investors today. we have the senior portfolio manager, saying gyrations created by central bank policies . we are looking at european stocks. end of the the thursday session, rising for the second day. the european close ♪ is next.

>> it's 11:00 a.m. here in new york and 11:00 p.m. in hong kong. >> live from london. i'm mark barton. in the trading day in europe today. watching the "bloomberg

close." european we are beginning do take you from new york to london to next time. the here are some of the stories out of europe today. for's the game plan currency traders. >> european union policy makers the brusselg at economic. program gets under way. highlights.you the >> trying to get a foothold in the competitive grocery mark u.k.in the thet's 19 minutes in trading day in the