♪ scarlet: political uncertainty is taking its toll. scarlet: we will get an update on soft commodities are in it how drier weather is pushing up the price of soy brain -- beings. with carol hamm. we have the new thoughts on golden oil. he is throwing his support behind donald trump. scarlet: we did get the headlines. i am looking at them now.

corn futures are adding to gains as a result in chicago trading. this is a crop report. it includes crop production numbers. it raises the winter wheat out as well. there is a result corn crop cut. it sees a lighter supply estimate for soybeans. this is overall in the world. ,orn and soy in wheat forecasts at least for coin in soybean, it's weaker than expected. it's higher when it comes to wheat. we is little bit more surplus. the weather has been an issue. potential hotter summer down the road. that could damage the land of the crops being planted. scarlet: we're going to get more information on this. we were at guys together.

scarlet: let's head over to shery ahn who has the latest. some ahn: there was caution before. happy friday. we are seeing a global stocks retreating. this is from the biggest two-day decline in a month. and theseeing the dow nasdaq falling across the board. this is the second day of retreats. getting itstors ready. we have the fed meeting next week. 7 -- brexit vote. at one point tumbled to the lowest since june 2012. it's going to lose basis points. people a little

bit cautious ahead of the weekend. we see oil lower. it is down. 2% right more than now. dollars alow the two barrel level. for the rest of the week, it is up. aboute to mention it's up 90% since february. we are seen gold unchanged at the moment. that is a safe haven now. outave a lot of caution there. alyx: intel is making some news. shery ahn: that was a big win for intel. the stock is getting a boost. that is the highest since april.

we hear from sources that the next iphone will be using modems from intel instead of others. qualcomm is taking a hit. 1.8% today.n alyx: mark crumpton has more from the newsroom. mark: we have some candid remarks about the republican nominee. mitch mcconnell tells bloomberg politics by donald trump needs to pick an experienced running mate did -- mate. >> he doesn't know a lot about the issues. you can see that in the debates. i have argued with him that he ought to use a script more often. there's nothing wrong with having prepared text. it indicates a level of seriousness. mark: his attacks on ethnic groups and other republicans needs to end. elizabeth warren and hillary clinton met privately today.

secretary clinton is in and. senator warren is in town for a friday session in the senate. possible vice donaldntial pick you trump has a tweet. the head of germany's track and field federation once the ioc to bar russian and kenyan athletes from the olympics in rio. it would be unjust to ban those russian athletes who have never been implicated in doping. russia and kenya are declared noncompliant with the anti-doping agency. gordie howe is dead. from 1946 through 1980, he played 26 seasons. his first 25 seasons were spent with the detroit when wings.

he was a 23 time all-star. considered one of the greatest hockey players of all time. he was 88 years old. the death came after the san jose sharks live to fight another day in the stanley cup playoffs. the goalie turned aside 44 shots. pittsburgh has a three-to lead in the best-of-seven series. game six is sunday in san jose. our 2500 journalists in more than 150 news bureaus around the world. back to you. scarlet: i met mr. hockey when i lived in hong kong. alyx: that's amazing. scarlet: he is huge. alyx: equities around the world are in the red. the fix is showing very calm waters.

they have a much more fearful picture. is erica.lk to us there is a lot of good money moving into bonds. we have money moving into gold. eric: gold has been the story of the year. it's taken $10 billion. in 2hings, it has taken billion. that is the lesser used when. it's a widespread move. it's not a fed inflation thing like it normally has been. this is a crisis hedge. the stickiness and the consistency is a bear sign. there are fund managers who are interested in gold. the big story has to be the global bond yields being so low. the u.s. looks very good in comparison.

are: almost all the flows responding. bmg have taken the lion share. usually you see that in the short term or the long-term. this indicates to me people are rebalancing. they own that as their core bond exposure. scarlet: it's positioning ahead of whatever the fed does. people feel it's gotten to frothy lately. more crisiss concern. alyx: do you feel they are a sticky? again,f you look at agg look at the flows. normally they are five or six. the fact that those two are the is two, that tells me there

rebalancing and it's sticky. scarlet: vanguard is all over the top 10 it comes to flows. eric: that's a bear sign. they are taking in money rain or shine. s&p is the fifth most, that's not good. that's taking in money no matter what happens. collective 5n a million and outflows. you see them at the top. scarlet: who is a risk of a trade? alyx: this is something we had been talking about. the low volatility is becoming more volatile. eric: this is the flavor of the month trade. again, the widespread miss of emerging markets have

taken $5 billion collectively. you are seeing both products taking an money. it's been consistent. scarlet: what is the difference? eric: it tries to give you sectors that are consistent with the s&p. the powershares version just says we are going to do the 100 at least volatile stocks. you have heavy utilities or staples. it worked. is fairly to investors who don't want to be over used to staples or utilities. alyx: what goes out? it's a had shaker. scarlet: if you want to see more of eric's world, he is on the bloomberg. alyx: this will be a pivotal market moving event. we have an amazing lineup of guest. scarlet: the fed decides started

at 1:00 p.m. alyx: this is bloomberg markets. ♪

abigail: we have a little bit of a selloff for the nasdaq. the overweighting technology. is of the worst tech losers netflix. they are down four days in row. second quarter trends point to a modest domestic net. it's a miss. he thinks this could be exacerbated by the price hike this month.

another big loser today adding to yesterday's losses is tesla. the company denies allegations there is a safety issue and they are trying to cover up or not allow customers to report those issues. this is preposterous. what's next for the nasdaq? we look at a two-year weekly chart. we see all kinds of volatility. there are three ranges of loads. the february loads up here that the last range could also take the nasdaq right down to those lows. be prepared for more downside. i am abigail doolittle. now more bloomberg markets. you're watching bloomberg. alyx: this is the global

business port. the former ecb president says he thinks of briggs it. -- exit. the move comes as the company faces increasing pressure to cut costs. the two sides of cold. we will look at one of the most abundant resources. we start in europe. he is weighing in on the eu referendum. a briggs it would be a catastrophe for the u.k.. he spoke to bloomberg television. the briggs it has ahead of them. be directly touched in case the people of the u.k. respond we want to leave. burglary,her blow to

the chief operating officer is resigning. he is exploring several leadership positions. it is the latest setback to burberry. shares are down 35% in the last year. you heard of smart watches. a special watchmaker is coming up with a smart strap. they are trying to fend off competition from apple and fit it. they want to make a strap that includes location and information such as football scores. tesco is pulling out of turkey. they are dumping the majority stake at a huge discount. the grocery chain is selling its 95% stake for $43 million. the market value of the company's 861 billion. is $861 million.

scarlet: we provide context and background on interest. is a major contributor to global warming. it's also cheap and abundant. -- has helpede lift millions out of poverty. that accounts for 30% of world energy consumption. consumes the most. consumption fell by 1%. that is the largest drop since they began at keeping records. burning coal emits twice as much carbon dioxide as natural gas. air pollution may reduce the global economy by 1%. tighter environmental regulation is one factor that is making coal mining uncomfortable and

unprofitable. peabody energy filed for bankruptcy. eight other producers did the same. here is the background. coal has always been controversial. it was banned in london in 1306. coal powered the industrial revolution. it shrouded london in fog. argument, us to the almost 200 countries want to limit global warming. the european union is helping curb in missions. the impact has been fairly modest. prompting clean coal innovations. they could remove the carbon of burning. the technology is expensive and not proven. global business report.

we have more stories at bloomberg.com. shellwe will talk to the revolution. ♪

alyx: he founded continental resources in 1967. it's the largest shale producers in the united states. $70 byks oil could hit the end of the year. yesterday with him and asked him what business decisions they were making after the oil rally. >> it has rallied. one of the first things we have done is get a valance sheet in order. we're paying down debt. that's the first order of the day. the second order of the day, we

have five dollars increments. it moves along to completing wells that we previously drilled. we are beginning that process. hopefully we will see higher oil prices and ramp up that activity. direction we're headed right now. continental today, we are offering 19 rigs. we are fairly active in our operation. last to be one of the bring on rigs. it's not urgent.

>> we are working in a great place. it's a play that we've got 11 rigs in. stack.developing a once you see a price rally, you'll see a lot of rig come back online and you will see a huge spike in production. is that the right thesis? thehat we have seen is industry. who would think they would shut down to the point they have. they have stopped completing wells. they are at the point that we are at. i think everybody, everybody knows that we could oversupply the market again. we keep an i on the market.

we will make sure we don't oversupply. alyx: will you be more sensitive this time around? >> i think people in our industry will keep an eye on it. out over theet skis like we have in the past. alyx: what is your price call for 2017? >> as much as a short supply. that adds up. we do have a lot of inventory to pull down. there will be some production come on. it's a small wedge. year, we had an oversupply. that's going to provide some

pressure to the price of oil. that's according to what materializes. be 2ink that supply can million barrels a day. that will add significant pressure. alyx: $80 oil? >> it's possible. alyx: a lot of workers were fired during the last year and a half. we saw 39% reduction. how successful have you been it bringing these guys back to work. company, one of those is layoff a lot of personnel. we have not done that. we wanted to keep her teams together and we have done that. there have been a lot of rig crews and service companies that

have had to layoff a lot of people. 300 20,000 workers have been laid off in this industry. that's a tremendous amount. a lot of those are going to be needed. it's going to take some time to bring them back in. need the riging to count we have had in the past. we are a lot more efficient today. it may take a couple of years. my interview with harold hamm. this is bloomberg markets. ♪

alix: live from bloomberg world headquarters in new york, i am alix steel. scarlet: i'm scarlet fu. this is bloomberg markets.

let's begin with headlines. mark c.: thank you, the fbi's probe of hillary clinton's in mills reportedly focused on the classified information in a series of e-mails on drone strikes. the washington journal reports that it is between islam a bad and two. in washington about drone strikes in pakistan. some of those were reportedly forwarded to her personal accounts. the suspect in the slaying of nine parishioners in a historically black church in south carolina what a judge to decide his fate, not the jury. attorneys for him say they will not consent to waive the jury. it is scheduled to begin on november 7. the obama administration has againsto widen the war

the taliban in afghanistan. u.s. will provide air support to afghan forces. u.s. troops will accompany afghan soldiers on the battlefield. stillalmost 10,000 troops in afghanistan. former president bill clinton will be among the service today for muhammad ali. you are looking at a live shot from louisville, kentucky. winding itson way through the streets of his hometown. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world. back to you. scarlet: thank you so much. domestic supplies of corn and so being -- soybeans will be tighter in the u.s. thanks to south american crop flows. alix: we are covering the story

from washington. in terms of prices, it was a really good report for corn and soybeans reviving their estimates. what was the single biggest intervening factor? is bad you are seeing weather in brazil cutting back the estimate for their crop. their harvest is just getting underway. this is a great time of uncertainty for weather markets. we're still a ways away from the south american harvest. there is a lot of volatility. the trend is clear. because you see dry weather in south america -- while the u.s. crop sizes uncertaint, the belief is that people will want to buy it. scarlet: i wonder if this is because of el niño or the transition -- hopefully, as a lot of people predict -- to la niña. alix: what will happen to the

u.s. crop if we do see la niña hit later in the summer? >> if you get another set of dryness, you are still not going to see inventory decline to the 2012 levels. anything that cuts down pretty high stockpiles will push the margin.ice back into a how that plays into cattle markets, consumer markets, that is all stuff we see unfold this summer. the projections for the united states is potentially bullish. alix: what is the quality of the crop in the u.s.? >> the quality is looking good. keyave not yet hit the points of the growing season when you start to see the maturity of the crop. for that reason, you did not see the usda mentioned changes to

the size of the crops. it was all on the demand size that they were making changes. scarlet: we just flashed up their how corn and soybean prices are reacting today. why are we seeing a decline? >> sometimes it is a matter of how much a market has over anticipated or oversold on a particular item. you see a little bit of that happening in the week or get -- wheat market. it is seen by far a record yield. croptill have a 10% larger than last year. these reports have all sorts of nuances. because of the time and here we are in, it is a very volatile report. soybeans withsee the major run-up into coffee. it makes sense that we see a little bit of price action come up. the question is, when you have a

drought, it can really damage the crop for years to come. niña, what is la the longer-term effect on the u.s. crop? >> it really depends on what happens this year. a crop can bounce back year to year pretty well. in the meantime, what has happened to the structure of the market. are you needing to rebuild or is it something that you can rebound quickly? to farmers have to sell their cattle because the feed got more expensive? if so, what does that do down the line? you have many factors at play. in 2012, we saw increasingly higher prices. but, we have had a couple of years of rebuilding. we not quite in that situation yet. we are definitely leading to higher inventories which means higher prices and some kind of supply response. the question is what baseline will it be starting from?

alix: great to see you. thank you very much. scarlet: the rebound and commodities overall has led to a double market. we are talking again of 20%. many questions remain over whether this is sustainable? >> we are joined now by the houndr and ceo of star capital. you really look at the charts. tell us what the chart of oil is telling us where things may go? >> one, bear markets do not work for -- last forever. number two, we see tremendous amount of money after multi-year declines. that is normal after massive declines like what we have seen. number three, sentiment. bearish. are oil is up nearly 100%. alix: we see a lot of call

options in the $100-$150 area. investor sentiment is starting to turn. >> at this point, after 100% rally. years, gold, silver, sugar, they all topped out in 2011, almost five years ago. we could now be in a very similar situation. 2009, back to the situation at this juncture. scarlet: we have a chart showing that now. wasn't 2008 demand driven while a015 is -- or was -- reflection of oversupply? alix: that is a good point. we had a big selloff for oil for demand. the one we have now is supply. does that change your timeline on when we may see a rally begin? >> in 2008, there was a massive

selloff across the board. in 2015 and early 2016, we're seeing a take rally in the entire commodity complex. the underlying fundamentals story is that they are putting their backs against the corner and have to stay the course of easy money and eventually global demand will kick in and we will see these commodities improve. scarlet: it is not just knee-jerk reaction. the dollar gained in may and so did commodities such as gold and copper. why was that? >> what is happening now is a little bit of a decoupling between the u.s. dollar and other commodities. extremely were undervalued. remember, commodities, unlike stocks, cannot go to zero. that is an intrinsic value that

people do not recognize. the commodities themselves have value. you had rallying from the middle one year ago.ut also, the dollar moved sideways. they were hawkish, then dovish in january-february. now, we see a big? as to what the fed is going to do next. they meet on wednesday. investors simply do not know. they have pushed the can down raise,d -- maybe we will we don't know. there is a tremendous now of money flowing into commodities this year, bearing some unforeseen global recession, we could be in the early stages of a new bull market. alix: we saw copper take a hit this week. that could be the canary in the coal mined. if copper cannot get a date,

canno that drag the commodities lower? >> that is the one commodity that is not rallying across the spectrum. global demand is very weak. we know that. as economic data comes out, a reader it's -- it reiterates that point. crude oil is up almost 400%. also, supply. on theirthat rallies snooze is bullish. all year, we saw oil take off. opec never froze. the ceiling never happens. oil prices charged higher. it is one of two things. either the economy will fall into a recession and other commodities are coming down or it is just a matter of time, and copper will take off, like the other commodities. scarlet: here is a function that we use here at bloomberg.

it is the commodity playbook overview. you can choose your sector. let's do agriculture for a moment and look at what you see. i am focused on this column here because when you look at the relative strength index, any read close to 70 suggests that it is overbought and do for a pullback. anything near 30 is to to be -- due to be sold. alix: we have seen so much money come in to the complex, investors are so long on commodities like oil. what is the risk that we see some kind of washout? no question. in the short-term, it is a very one-sided trade at this point. as far as speculators, you have a lot of people who are long, but they are chasing these markets. these greens just sold off. it could have a case of buy the

rumor, sell the news. the moves, in the short-term, are very extreme. a major- it is n global commodity. in the short-term, we are extended to the upside. it would be normal to see the markets paz, pulled back, digest, and then you see another like higher. the key is to analyze the pullback. scarlet: summarize all of it for us. what is your call for oil, coal? >> we are in on their snooze the early stages of a new buyback. if you want to buy commodities in the futures market, you can do that. or you can even by the commodity stocks. look at oil. even the steel stocks. the col gold, one of the strongest in the market.

looking for $60 oil? $70? $80? >> in the near term, we say that will prices are going higher. as long as the entire market does not sell off, we have a very strong as the entire market does not sell off, we have a very strong underlying bid. easy, mid-70's. alix: thank you very much. scarlet: coming up next, i'm mr. stock of the day. consult ourt pick -- are falling.les alix: urban outfitters? ♪

alix: you are watching bloomberg markets. i am alix steel. scarlet: i scarlet fu. let's go to the markets the big reveal on the ministry stock. dropping as free people continue to come into the stores. free people -- the clue there. urban outfitters. first mystery my stock, and you are right. it is urban outfitters. you are right.

the stockns here is declined as much as 8.3% at one point today. aey are now warning of slowdown in the second quarter. back in may, they had already warned of the slowdown. back then, the ceo said it was because of unusually cold springs. now, we are saying that they are saying that store sales are falling. people are worried that this may be a deeper slump. before this, we solve the stock deigning above 20%. now, it is shooting back down. if you take a look at the inner hugehart, you see the slump which was down as much as about 6% now down today. misery loves company. let me take you through some

other stocks that are seeing a really bad year, actually the worst performers. jewelers down 28% for the year to date. gap, down more than 20%. that was my ministry stock. i will have better options so that you can guess. alix: i never get it. this is like a rarity. thank you for making me feel good. scarlet: thank you very much. alix: it is time for your business flash. regulators have questioned according to a person briefed on the matter. a fund is at the center of a number of investigations into money laundering. inrlet: for the first time

five decades, airlines have received permission to schedule flights to cuba. they will fly from fiv u.s. cities to nine u.s cuban cities. alix: apple's new iphone will use a modem from and tell. they have chosen in telford the network.ed on the at&t iphones on verizon's network will stick with parts qualcomm qualcomm. scarlet: we want to take you to some live pictures in washington, d.c. were donald trump and conservative leaders are speaking. you see carly fiorina.

also, sarah palin, john kasich, and ben carson. formermer hp ceo and presence of candidate there addressing the public. alix: it should be very interesting. scarlet: just ahead, some big names in cable-television testify before congress later this month. what is at stake for the industry? just ahead. this is bloomberg markets. ♪

you're looking at live victors of presence of candidate hillary clinton speaking at a planned parenthood action fund in d.c. this is the first time that we hear from persons w she got

president obama's endorsement yesterday. scarlet: earlier today, she met with senator of elizabeth warren as the to step up their attacks on their nemesis -- is that the right way to put that? donald trump, of course, who is running for president for the republican party. alix: on the shortlist for the vice presidential pick, of course elizabeth warren's name is on that. scarlet: june 23 is the date that the u.k. votes to stay in or leave the european union. it is also when television providers testify before congress on customer service and billing practices. bloomberg,orter for who covers technology, joins us. what will happen on june 23? >> on june 23, all of the major pay-tv, cable, satellite tv companies will be before

investigation. they will probably face of lot senatorfrom said mccaskill. she will probably come with a lot of ammunition to the meeting. scarlet: interest groups are asking the fcc to step in here as well. give us the backdrop. >> that's right. they asked the fcc and federal trade commission to bring action andnst at&t, comcast, cablevision. that is related to how they .ollect and monetize users data they are saying that the companies have not gotten prior consent from customers to use that data and send targeted ads for them. of course, the cable companies responded and said, we do everything aggregated, so they are not in violation. alix: what is at stake than for the company's?

multimilliony some dollar fines. the enforcement bureau has not been shy in bringing some record fines against they companies in the telecom sector. the enforcement bureau chief cable company practices are on his radar. alix: thank you very much. of bloomberg -- a bloomberg national news reporter. scarlet: we have breaking news on gawker. it has filed for bankruptcy in new york. renowneddia, which is in new york, hated by some, loved by others, filing for bankruptcy in new york. hogan verdict grabbing people's attention. it got a lot of people's

attention raised greatly wonder the nailt was that in the coffin. alix: coming up, a package for puerto rico in a rare bipartisan move. scarlet: all of that and more coming up on bloomberg markets. ♪

a.m. in hong kong. >> welcome to bloomberg markets.

>> from bloomberg world headquarters in new york, i am scarlet fu. alix: here's what we are watching at this hour. a dire warning from bill gross, say collapse in global bond yields is a supernova. chipmakerhe reportedly getting an order from themaker that could turn industry upside down. alix: and the eighth annual decathlon impeding for greatest athlete. it back-to-back decline for u.s. equities. >> we are seeing declines across the board. the biggest decline in a month.

no different here in the u.s.. 1% and the nasdaq losing 1%. looking for some caution ahead of the fed meeting next week. if you take a look at the some of, you can see that decline. specifically financials. we are seeing energy down below $50 per barrel. materials also getting hit down half a percent. materials have been taking a hit for quite some time. some concerns over china. china is the biggest consumer of raw material. we are seeing copper getting hit. not surprising the

bloomberg commodity index, which tracks returns, is now down for a second consecutive day. leading the decline among commodities. they are declining down two point 8% and holding $49. >> we are definitely seeing investors walking to safe haven. gold and silver feature continuing to rise. now paring those losses is up slightly. silveralso seeing heading for the biggest weekly gain.

look at that gain of 21% for the week. it has been on track for the largest weekly event since april. >> thank you so much. >> mark crumpton has more from our newsroom. the presumptive democratic nominee hillary clinton speaking at a planned parenthood fundraising event. telling herton audience she will always have planned parenthood's back. he wants to return to the time of illegal abortions. hillary clinton speaking live at a planned parenthood event in washington dc. the u.s. house has passed a bipartisan bill believing puerto rico's that crisis.

they will restructure the territory $70 billion debt. a july 7co faces deadline. the government says it doesn't have the money. chancellor angela merkel plans to keep her countrymen guessing for now. merkel is not saying if she will run for a fourth term. she said she is waiting for the right time to decide. merkel has been chancellor since 2005. her approval rating in april was the lowest in her third term. time for the memorial service for muhammad ali has been pushed back. it was scheduled to begin 2 p.m. local time in kentucky. organizers at the kfc young center say the start time was pushed back at least two hours. the funeral procession didn't get underway until mine -- until 90 minutes --

all he will be buried. global news 20 hours per day powered by our 2400 journalists and more than 100 50 news bureaus around the world. back to you. the new york state retirement fund is the for -- is the biggest pension fund in the country. >> how does this fund guarantee a sustainable return in this low yield? she is the chief investment officer and answer that question earlier on bloomberg . >> what we need to do going forward is to make sure we have investments in the asset class it's come -- asset classes will generate outside return.

>> two examples you gave, converting equities into alternatives. is there an equivalent today given they'd low yields -- given the low yields, is there an equivalent for taking on >> we are really trying to give the beta of the market. when we are investing in private equity we are trying to invest with firms that are maybe smaller, where our general partner can get more governance and generate more return. theme from us generally. 8%h 50% of public equities, ofreal estate, 25% fixed income. it is getting all of those right. focused on the most right now is making sure

that in this very volatile environment with low growth and interest rates, that we have the right skill and talent. of the big initiatives. we need to have more people that can navigate these markets. and we need to pay them more to be able to do the things we need to them -- we need them to do. like an insurance company you have to match long-term obligations. hard to goincredibly to a long-term bond and get a pretty decent locked in return. where are you finding the way to the risk? >> there are certain asset classes we have been talking about like private equity and real estate.

233% globally. the have the ability to index. hire an decision to active manager is a choice. decision -- our belief that those additional fees that you may pay, whether it is active management or private equity or real estate. a lot of things we need to do smartly. addition to an mba at the university of chicago, you also studied philosophy. a tell us about your philosophy especiallydge funds, ones that aren't huge. hedge funds that are trying to make a mark but can't seem to get the attention.

>> hedge funds have a target allocation in our portfolio of 3%. it was to provide a diversification against equities. i've said it publicly before, the fees are too high. the industry has gotten very big. invest in hedge funds that provide something different. we are $170 million. while there might be a $500 million hedge fund. we can't access that. an importantn

project. we have some hedge funds that do very well for us. number two we are going to make sure we are with hedge funds that can help us meet. >> bill gross sounding the alarm of global bond yields. a dire warning next.

scarlet: let's head to our

markets desk where we have a check on individual movers. sherry: we are taking a look at pharmaceuticals it a bloomberg bile is plunging down 8%. new results that show a big improvement in its drug and sickle cell disease patient. this competitor jumping more than 15%. another stock that is soaring, -- is after ruling a chemotherapy drug that they have. now it is 7%. take a look at milan. a wells fargo analyst said the company could face drug pricing

scrutiny today as it took some exceptionally large price hikes this year. wells fargo saying the price increaseluded if 542% on generic gallstone medicine. increase on acid reflux drugs. now we are seeing that stock falling. >> thank you so much. falling toond yields record lows as investors seek that safety and bill gross morning, "lowest yields in five years in reported history, this is a supernova that will explode ." scarlet: if you look up the definition of a supernova, it is a star at the end of its life

that increases in brightness because of a catastrophic explosion. not been right in many years, but this is really what is in essence causing bill gross 2 -- take a look at world bond yields. i'm interested in is this column. it is the range, that orange line. in the blue is where we are right now. also in portugal and sweden, really quick i wanted to point out what the two-year looks like. all oversee the lift the map. , here's another way of illustrating it. bronson u.k., germany, japan are

in a tear. yeara look at the 10 yield. japan is already negative right below zero. germany is getting there, inching closer to the negative line, and a u.k. is just above 2%. quandaryiously in a how to stimulate its economy. the easy answer seems to be more .od -- more bond buying >> that lines of distorting the corporate market. a great chart from bank of america that looks at the high-grade corporate bond market in the u.s., as well as the eu. arestment-grade bonds paying $180 billion worth of yields annually. euro market, looking at a $20 billion annually. that is an eight times difference.

toyota coming out and raising money in japan. that is not what the world is supposed to look like. million, these are not lows backed by the government. this is based on the company's cash flow. bloomberg has checked through all the data. >> howard would you like to have a mortgage? because theyney can. some of the biggest business stories in the news right now. apple's next iphone will use modems with qualcomm chips. intel modemosen chips and other versions of the smartphones for overseas markets. all of this according to people familiar with the matter.

iphones sold in china will also work. malaysiaising from battling -- funds. the fund is at the center of several investigations. $6 billion. >> it is a deal with an enterprise value with $1.38 billion. it ends as an extended takeover contest. the value of the deal includes that and certain other liabilities created they will create the third-biggest producer in north america.

>> gold has rallied thanks to market volatility. the fed will not hike rates as

quickly as projected. >> and an increase for etf speed even george soros is getting in on the action. there is a new way to access precious metals. >> thank you so much, i welcome everybody on bloomberg tv. he is chief executive officer at .tx a scar look and i were talking about the run up we have seen in gold. how do you explain the move? started with uncertainty. people were looking for the next safe haven. >> we see hedge funds and george soros moving into it. actual pay the commodity.

what is the gold strategy? you take the s&p 500 portfolio and overlay it with gold futures. we find withs what investors, they don't have gold in the portfolio when they need it. want to invest for the long haul. taking the s&p 500 and adding gold on top of it, that is the general idea. terms of returns what have you seen? >> i'm only supposed to talk about the live history. they look pretty good because gold has done well. assume you wouldn't do the strategy of mus you could tell. >> from a very long-term perspective we know gold was a hit in the early 70's. the math, it is

8% to year, which is well in advance of inflation. the s&p 500 has done a lot. it looks pretty good. >> it is always seen as a safe haven. gold and hedge fund guys and why they are moving it. to youroing back original currency of the world. >> we definitely think gold is still relevant. people have thought about it as an investment. we think investors have a lot of times not taking that exposure, because they don't want to sell out of stocks and bonds long-term. then you are stuck with this market timing question.

way to do that without having to go in and out of the stocks. , how do you anticipate a different environment? we have been in this slow growing no inflation low rate environment. often get asked when rate start going up. if you look at the last 15 year period, the only time it really went up was for a couple of years when they went from 1% to 5%. during that time gold was up 55%. case the always the rising rate environment is bad for gold. a dollar in the strategy and it combines and s&p 500 exposure and -- at the same time.

you have the risk that both of those go down at the same time. main selling points is it has been shown to be a safe haven. it actually got a negative correlation to the equity market. years we sawor 11 the commodity come up. of the trajectory we see now, are we on another longer-term trajectory? >> i get asked that all the time. how fiscal and fed policy is determined over time. i will tell you what is happening in europe and asia with negative rates. i know bill gross was just talking about a supernova. that is taking a lot of uncertainty. you have the s&p 500 that has tripled.

bond yields at very low rates. there is certain -- there is uncertainty out there. iti will be chris to see how does in the longer term. alex, scarlet, going to send it back over to you. to take you to live pictures of donald trump. time sincest president obama endorsed hillary clinton. >> i see in france they have a massive soccer tournament, something so important and big.

>> from bloomberg world headquarters in new york, you are watching bloomberg markets. >> let's begin with bloomberg first world news.

mark: thank you so much. senator elizabeth warren and hillary clinton met privately in washington. clinton addressed a meeting of planned parenthood and warren at tressed a friday session in the senate. she formally endorsed mrs. clinton last night. some candid remarks about the likely republican nominee from the president and the republican leader of the senate. mitch mcconnell tells bloomberg politics donald trump needs to matean experienced running because he doesn't know a lot about the issues. mcconnell says he still supports trump. >> to much him a different direction. he will have to respond to the right of the senator elected. i'm comfortable in supporting him. ethnic groups and other republicans --

it is now expected to create a real estate room. more than 2000 homes were destroyed or damaged by the wildfire that roared through fort mcmurray in alberta. thatonference board asked they provide a $785 million boost to alberta's economy. from 1946 through 1980, he played 26 seasons in the national hockey league. his first 25 seasons were spent with the detroit red wings. lost -- nhltime nhl all-star. gordie howe was 88 years old. global news 24 hours per day powered by our 2400 journalists news bureaus 150 in the world. he was a very big man, a very

imposing man. >> thank you so much. the greatknows recession saw a surge in foreclosure activity. many foreclosures may not have been in -- may not have been done in compliance with the law. >> we spoke with the author of the new book -- which tells the new story of a group of activists that blew the whistle. >> what didn't they discover? they cover up this inability to track properly the transfer of mortgages from one entity to another during securitization. that is when all these loans got packaged up and centered around. >> there are very specific rules and documents.

things that have to specify how these papers are moved around. the great machine ignored all of that. is supposed to give us confidence that when we buy and sell property nobody else has a claim on it. it really separates developed nations from undeveloped nations. what were some particularly egregious examples these activists found? >> one examples this lady, linda green. as anme was used authorized corporate officer for 20 different banks to sign these documents after the fact and to speed up the assembly line. public records, there is melinda green written 20 different ways. >> people get that a lot of these documents were improper.

what is the response to that? any other context, false evidence is being used in a .ourt of law whether innocent or guilty they would throw out that case. foreclosure law that this arguing gets made. fault when the bank sliced and diced these mortgages. >> one of my favorite aspects of the story is the activist had no prior knowledge of how securitization worked or how the morgan -- or how the mortgage industry worked. explain what they discovered. >> these were people self taught like you are me. only the blue light of the computer to guide them. records,hrough public

looking through websites reading securitization agreements. createdof them sort of a legal education for themselves to understand what was going on in the patterns they found all over the country. >> have things gotten better? >> every day in america somebody is thrown out taste on false documents. there were the settlements that -- it really can't because once you break the chain of title it is difficult to unbreakable. joining us now is our cohost. this is what you read during your leave. is good to talk about all these numbers, about foreclosures going up. they get the perspective in the homes. i thought it was a fascinating discussion.

>> we talked earlier this week about why the city is going into bankruptcy. are speaking with andrew brady taking a bullish site -- a bullish side. >> such a gloomy future for the company. sees tonshe says he of that. we are looking forward to hearing the counter argument about why that is overstated. >> more than $5 billion in legal liability sibley have not factor that in. 10 times as much as analysts estimate. >> everyone knows that. everyone knows those liabilities are at risk. if everyone knows it, why is the

stock not at zero yet? is interesting is andrew luck was talking about it from a stock point of view. is a credit analyst looking at a balance sheet. are in any they position to pay it off. the debate is about the operations of the company itself right now. nobody is arguing sales are going down. as this is definitely the right angle. >> good to dig in. we will see you later. we are also going to be speaking out with h bessey -- hsbc global strategist as well as the equity selloff. victory inp, a major

the mobile chip sector, getting an order from apple for some of the next iphones.

scarlet: let's head to the markets desk where sherry and -- where shery ahn has been tracking the move. >> let me take a look at analyst ratings, which is a tech-based company just downgraded. they were cut from a cell to a hold because the debt cap bounced. , theer stock falling today

drug company. they have been downgraded to neutral. they are falling 1.2%. this is a stock bill ackman put steak on earlier. now saying that the stock has significantly outperformed the specialty group year to date. still downgraded to neutral as they are seeing a valuation as fairly valued. another downgraded by city. it was cut to neutral. they cite a valuation with the stock above its previous price target of $20. is polaris industries, this an atv maker, it was cut to neutral. now the lowest level since february. it is expected they will deliver

below earnings in the second quarter. >> in a major mobile wind, intel is set to order from apple to supply chips for its next iphone model. forhis move is crucial intel, which has been slowing in the current pc market. bloomberg intelligence; dr. and hardware analyst, this is good intelligenceberg semi conductor and hardware analyst, this is good news. >> this is somewhat of a zero-sum game in that the mark -- in fact the smart phone market is slowing. we are seeing a wave towards media texans it is cheaper. you are also seeing samsung making their own ships.

-- own ships. they make their own processors but they by the modem from qualcomm. now they are going to buy the modem from qualcomm and intel. a split component sourcing strategy for them. for intel this is a lossmaking division. they have not moved the needle from the share perspective. their salesng at right now. their sales were up 8% in the first quarter. reallyh money can intel make from selling these chips? step one, let's reduce the losses in the division. apple brings a significant amount of scale to the game. let's start reducing the losses and that we post -- we will talk about step two.

>> our orders from apple high-margin or is this something where apple is able to squeeze their suppliers? >> you are hitting the nail on the head. basis this is going to be weaker pricing compared to what qualcomm may have extracted, or some other component. that is part of the deal with apple. the greatest place to be in the apple food chain is apple. >> what did they have to give up to get this contract? -- from a an from a component sourcing strategy it is interesting. apple has had very few component suppliers for each of its chips. as the platform has expanded, you are starting to see suppliers come in. on the mobile chip, they just have two models. one for the at&t models and one for the verizon models.

might have to see more flavors of the iphone, which means more component makers, .ore divided skews you had a different kind of phone for a different kind of market. >> tell us about intel and why it has been struggling so much. >> this is a scale game and qualcomm is so far ahead of theybody else in terms of number of engineers it has been able to dedicate to the task. number of different frequency bands by different carriers and different parts of the world, and to be able to coworker that with wi-fi and youtube, it is a technically complex system. all of these things are moving at different speeds.

qualcomm has done it better and faster than anybody else. >> thank you so much. me --'s jobs reports for for may dropped the jobless rates for the first time since last summer. >> lower commodity prices continue to take a toll. the job market is getting a much-needed shot in the arm. jamie surgeon of bloomberg td -- bloomberg tv canada joins us now. >> another ugly month for resource to tend and provinces. chiefly alberta, the oil epicenter. attributed to oil workers. you have the jobless rate working another half percentage

point to 8%. which is nearly a full point above the national average. we have to understand the month included the wildfires, you have the evacuation of fort mcmurray, which meant the stoppage of work out of town out of 80,000 people. what is expected to be a bad print turned out to be a very bad one, unfortunately. >> there is positive sector regional data that is offsetting that this? -- that weakness? >> there is a silver lining. we saw a pickup in manufacturing and export related hiring. primarily in traditional and industrial areas. that reflects what policymakers want. they want to see them attracting the lower dollar and -- more of that today. general motors announcing they are beefing up their spending in ontario, looking to invest in

things like self driving cars. that is what policymakers want to see. >> thank you very much. joining us from toronto. a little bit of good, little bit of bad. >> coming up, who will be wall street's fittest athlete is here? a preview of the decathlon. >> that is hard-core.

it follows a costly legal battle with retired wrestler hulk hogan to the gossip website told the florida judge it could afford to pay $140 million awarded to hogan for posting a sex tape online. for the first time in five decades u.s. airlines has one-day permission to resume scheduled air service to cuba. the airlines were approved by the department of transportation. they will fly to nine cities in cuba other than how >>. to keep a's try chinese company from buying a german robotics firm and time is running out area angela merkel

wants the matter cleared out before going to china next week. merkel has discussed the deal ahead with another german company. and that is your business flash update. >> we are in the home stretch in terms of the weekend. a charity event called the decathlon is kicking off in new york tomorrow. a decathlon board member rang the opening bell at the nasdaq market site. than 300 financial services firms have participated, which has raised more than 6.5 million dollars to support pediatric cancer research. the captain of bloomberg's team in the decathlon. we weren't even asked, by the way. you can you tell us about the goal of this event?

>> the goals are pretty simple and straightforward. it is to raise money for pediatric cancer research. pediatric cancer research depends on private and individual donations. the decathlon has developed into one of the leading drivers of inritable contributions pediatric institutions. >> you have been doing this since 2008? been doing it personally since 2010. >> this year is different because you are taking it on the road. york.have added new we had the idea to take it on a national tour. >> there are two competitions. a group competition on saturday. you are representing bloomberg. what are all the events you have to go through. >> i'm doing the bench press and the 500 and -- 500 meter power

row. >> this is a list of all the events you have to do. >> if you google decathlon, a lot of the events from the traditional trip -- traditional are things like the pull up, the javelin. those are not things we see here. nflhis is based off of the -- it is more geared towards that. >> how did you train for this? i don't know if the camera can get it. >> i was a competitive body builder before this. a lot of weight training, cardio, diet. a lot of time in the gym. been a regular crossfit participant and athlete for the last five years.

>> and what is one you can really knock at home? the whisper numbers have me on the vertical jump and the polyps. more of a bodyweight exercise. >> what would you tell someone who wanted to get involved next year? things, i would say look us up online at decathlon.org. we started as an elite focus group trying to declare wall street's best athlete. a lot of women participate now. the age groups range from 20 through 50 and up? >> is there a favorite to win? >> bloomberg is the team favorite, maybe. on the individual competition there is a returning champion. it looks like a number of competitors coming after them.

>> team captain for the decathlon, good luck to both of you. , weick programming note hope to see one of you back here then. good luck. that is an amazing feat. coming up in the next hour of bloomberg markets. hampshire willew be joining us. hear what the republican has to say about puerto rico and the presidential elections.

david: it is 2:00 p.m. in new york and 2:00 a.m. in hong kong. shery: welcome to "bloomberg markets."

david: from bloomberg world headquarters in new york, i am david gura. vonnie: i'm vonnie quinn. david: government bond yields around the world sinking to record lows. where should investors be putting their money? vonnie: oil and commodities also declining today. we will hear from the ceo harold resources hamm. move to rare bipartisan help puerto rico. .e will hear from judd gregg let's head to the markets desk where shery ahn has more. shery: stocks retreating for a second day. after pressing given global stocks have announced their biggtw