nothing in the bank. -- a rateey see and of return? hon. yellen: if the economy progresses along the lines i spectre think it will be rep. pearce: a previously answered my question that he felt like we made a lot of progress, and yet, seniors have not seen any progress. that is one of the continuing problems that we have. now and youto ask mentioned that is well known that the federal reserve's objective is maximum employment. do you have a handbook that you put out -- how to achieve maximum employment? something that political candidates like maybe a candidate for president might say she is going to get rid of all the coal mining jobs? do you all have a handbook that says if you do that you will really put pressure on the economy over here?

i know you did not want to be very political, but do you put out anything at all? because when i look at things that the government does, i draw a different conclusion than what my friend mr. sherman draws. i see regulations that say the has regulation -- hayes regulation being implement it in the west, you cannot see the difference in the air. you have to have a computer to measure it. using that regulation, coal miners being sent to the house in new mexico make $60,000 a year and they are going to be on subsistence level government support checks. that is an actual regulation that is penalizing the job market. i see those penalties, but do you all put out any kind of a fact sheet that says, look, you increase minimum wage, burger king is going to go and put kiosks in. the poor people are never going to get into the labor market. the gap between the rich and the poor is going to increase because we have outsourced and sent those jobs out of america

on the low end of the scale that allow people to get into the workforce. , wonder if you all do that because if you are in charge of trillions of dollars of the economy, it seems like you would put out some sort of a fact sheet so people sitting on the side of the desk could actually have some idea of what effective policies would have. i guess the answer is no, they do not put out a fact sheet. hon. yellen: not one of the type that you are describing. rep. pearce: there are trillions of dollars at risk. chair: the time of the gentleman has expired. the chernow recognizes the gentlelady from alabama. >> i apologize if you have already answered this question, congress,mbers of both senators and house members,

last month send the letter highlighting the fact that the federal reserve act mandates that the president and the board of directors at the 12 regional federal reserve banks "represent the public." despite this mandate, there is only one nonwhite regional bank president and he is also the only nonwhite member of the fomc. 83% of the federal reserve board members are white and men make up nearly three force of those directorships. regional of the 12 federal reserve presidents are either former executives or trustees at goldman sachs. in response to the letter, you said that "45% of the directors are either women or minorities, meaning 55% are white males." does your response indicate that the leadership at the federal reserve bank is fulfilling its mandate to "represent the public" with due consideration given the enormous economic interest of our diverse nation? hon. yellen: let me start by

saying that i believe that diversity is extremely important in all parts of the federal reserve. i do want to distinguish two different things. were at full strength, 19 members of the fomc, that is 12 presidents and we are now at five board members. there are supposed to be seven. a completely separate category of leadership are the directors of the federal reserve banks. there are nine of each banks. and then there are branch boards that also have their own boards of directors. i do believe that we have made substantial progress in achieving diversity and improving our performance among directors at the reserve banks and the branch boards.

i believe the figure that you cited -- the 45% -- refers to those directors. 24% of point, we have those directors in minorities and in an additional 30% are women. in total, women and minorities come to the total that you cited. reserve bank presidents, we are looking at 12 presidents, and as you said, one is a minority. then there are two women reserve bank presidents. i would very much like to see greater diversity at that level, too. it is a goal that i hope we will make progress on in the coming years. the procedures for appointing this presidents are set out in the federal reserve act.

theboard has to approve appointments of presidents that are recommended by the class b and c directors of the reserve banks. thensist and make sure that searches for those presidencies are national, that the candidate , and dueiverse consideration is given to diversity as an important goal. we welcome and have been taking recently public suggestions from the public about possible candidates. when the searches are launched, we will make sure that candidates who are suggested get. careful consideration. rep. sewell: it is suggested that governors fulfilled the

classy directors on each regional bank board from an frommic background -- one a community-based organization and one representative from a labor organization. what does the fed think about this recommendation? does the board of governors have a strategy for increasing the diversity of its leadership so that candidates are considered who have a variety of backgrounds, not just solely that of wall street? hon. yellen: so we track diversity not only in terms of gender and race, but also in terms of experience. i believe we have made considerable progress in achieving the kind of diversity that you are discussing. i believe on every reserve bank ,ranch there is an individual might be an academic or someone who represents communities and nonprofits, and we are constantly trying to add to our ranks of people who

represent labor. chair: the time of the gentlelady has expired. organizes west moreland . i want to thank you for your inspector general going through the cyber security policies. i want to encourage you to listen to what he has to say because you are on the front line really of our affairs when comes to cyber security. i just want to thank you for want is other thing i to make the difference between the tip-in tap from the general california about new regulations. there was 81,000 pages of it . the derailment from california

said he was grateful for them because they were there to explain the regulation. tore i am from, if it takes 27 pages to explain something you are trying to sell tell somebody, something is way too complicated. point of some of the other questions that have been here before. the complex regulations that they are, it is taking all type of compliance officers. banks are being taken down with this. sometimes they have more compliance officers then they have loan officers. my question to you is this overly burdensome regulation that is on our small banks, is it a priority of the federal members of for other the federal financial institutions examination

council? is it your priority to get these regulations off? hon. yellen: it is our priority to do everything that we possibly can to reduce regulatory burdens. i think we have already taken some significant steps. we are completing the gripper review. i believe we will take more steps in light of that review and we are looking carefully at a very simplified capital regime that could apply to these community banks if they are well capitalized and managed. rep. westmoreland: i feel like i've been asking the same question now since 2008. my district probably had more community bank failures than any other district in the united states. we keep hearing this over and over about we are looking at regulations and so forth.

is there any way that you could give me some type of timeline as to when something may come out about this? hon. yellen: we have already put quite a few things in place. it is not that everything is in the future. tohave raised our thresholds a billion dollars for capital requirements to apply to small holding companies. we have changed our examination process so that our examiner spend must trust -- much less time in bank premises. we have made our examinations that we focusd so on those risks that really are relevant to banks. we have taken a number of steps. , twice aegularly with

year, with a group called cdac, witches community banks, to hear their perspectives and take their suggestions when we can. we have a special committee of the board that focuses on community banks and assesses ways to reduce burden. rep. westmoreland: i thank you and i hope that you have been communicating with the community banks, too, about what you can do to help them. one other thing, just a follow-up, as i mentioned, my district in georgia knows what it's like to lose a bank. while the federal government is focusing on a can of policies for large banks, designating ands and nonbanks conducting stress tests all the while these policies are still creating that notion that large banks are too big to fail.

and so, i guess my point is that somehow there has got to be a more distinct classification between banks and the size of banks. hon. yellen: i agree with that. we want to tailor our regulation so that they are appropriate to the risks. we are likely to make changes to the stress testing regime that would reduce burden on some of the smaller banking organizations that are subject to the process. rep. westmoreland: thank you ., chair: the chernow mechanize is the gentleman from georgia, mr.' scott. when you were here the last time, i raised the issue of high unemployment among african-americans. it is absolutely staggering. in some of our communities, particularly with african-american males between

the ages of 18 and 37, it is over 22%. in some communities, it is as high as 50%, which leads to all kinds of problems. the crime problem, but more importantly, the breakdown in the african-american family, because these young men who are aged 18 to 37, that is the childbearing age. we have got to look at this as a national crisis. i asked you to do that and you scott, -- you said, mr. i do not have the tools to do what you are asking. but i say to you, miss yellen, you do have the tools coul. you have got your voice. you have got your position. you have a dual mandate to curb inflation but also to deal with unemployment. and we need you to use that voice to holler loud and clear

that this is a national crisis. it is the number one domestic problem that we have got in this country because of the devastation and the impact in the african-american community. but here's what really concerns me. since you say you do not have the tools, why are you so eager to change course on monetary policy and raise interest rates yourself when the unemployment level in the african-american community is so high? you said it yourself. you said that your future rate increases depend on the day that you have. to me, chairman, the data is telling a pretty clerestory. one, we are well below the 2% inflation target. abroad in places like china is anemic.

most importantly, the dollar remains strong. so tell me, chairman, what harm do you see in holding the interest rate at its current level until we can get our hands around this problem and get some improvement in the african-american unemployment rate? hon. yellen: congressman, i do want to call attention to the material that we included in this monetary policy report and intend to continue including that discusses the situation, the labor market situation, of african-americans and other minority groups. it does document, as he said, the high unemployment rates of african americans. but there has been improvement. rep. scott: what is so frustrating to me is that you are in the position to say something, to do something.

this is intolerable. you are the only agency with this dual mandate. hon. yellen: congressman, we are doing something. rep. scott: what is that? hon. yellen: we are doing something extremely important, which is putting in place monetary policy that has brought down unemployment rates and improved the labor market for all groups in american society and the trying to do that in the context of our price stability mandate. as serious as the suffering is in the african-american community, and it is, there has been improvement and there will continue to be improvement. our policies are designed to make sure that we continue to have improvements in the labor market that will benefit the african-american community and others as well. i've used my voice and i will

continue to do so. in the work that we do in community development, we will continue to use the tools at our disposal to try to identify interventions. rep. scott: let me try to identify something right here. we are in the midst legislatively of doing things like building the keystone pipeline. why can't we target that so that these young people can get on jobs or they can learn the basic skills as they work? earn as you learn. get them involved with labor unions that have skill programs. we have just passed a bill to be able to lift the embargo on crude oil. that is going to spread out 200,000 jobs. i mean, we have got to look at our economy and point out areas where we can get african-american young men into the wheel to learn the skills.

hon. yellen: this is for congress to consider. rep. scott: we have done that. we have done our job. chair: the time of the gentleman has expired. rep. scott: we need some leadership from you and the administration. chair: the chair now mechanize is the joe maddon from -- now mechanize is the gentleman from connecticut. >> when you talk about the negative disastrous impact that the fed has had on the african a -american community and the poor in this country. you give us speak on the income gap in this country and you said that it has long been interest to you in the federal reserve and expressed concern about that. basically your comments were nearly similar to what the administration has been saying. he lamented the problem, but fail to acknowledge in your comment that it is your actions and the fed and the government policy that can have a dramatic impact on the gap between the

rich and the poor. how it has fallen behind ar during the initiations last eight years. there's no coincidence. let's look at your premises are and what he said. bernanke said that they can raise asset prices, particularly the stock market. the question is who does that really benefit? let me give you a number. according to gallup, 90% of households with incomes over $75,000 own stock. under1% of households $30,000 own stock. if your policies, as ben does, itindicated it benefits the stock market and raises asset prices, who are you benefiting? the rich. who are you hurting? the poor. the stock market has boomed in th in the biggest beneficiary

is those at the very top where the wealth in the stock market is concentrated. that is what the gentleman is pointing out. he is looking for leadership, but leadership to lead in the other direction. not always helping the rich and hurting the poor. another area where you take a pattern of helping the rich and not the poor is where does the average person making under $30,000 putting their money? in the stock market? know, savings accounts. the average return is six basis points. at the same time, you were s 50ng wall street bank basis points to park their money over there. why do you see the need to benefit the goldman sachs ceos of the world and pay them more than the small local banks on main street where my constituents have to invest their money? do you see a need to benefit the rich continuously at the

disadvantage of the poor? white is that? -- why is that? hon. yellen: i'm sorry, we're not trying to benefit the rich at the expense of the poor. rep. garrett: your intention is not to benefit the rich, but your actions are benefiting the rich over the poor because of your monetary policy. is that correct? hon. yellen: it is not correct., rep. garrett: which part is? that they will invest in the stock market and not savings? hon. yellen: 14 million jobs. rep. garrett: is that fact true? excuse me -- i've the floor. the fact of the matter is the rich own stocks. the fact that quantitative easing increases benefit purchase. you said yes. that that is th is

increasing the value of the stock. the fact of the matter is that for the average poor person they are not in the stock market. you are saying all those facts are correct. hon. yellen: houses are widely held by most families and low interest rates -- rep. garrett: as far as where most people have their investments -- hon. yellen: they have also benefited from rising house prices. rep. garrett: part of the problem is that although you admit here to do that that is not your intention to help the rich over the poor, what you are nodding yes on every point that i raise is that the monetary policy of the federal reserve over the last several years of your tenure benefits the rich over the poor and creates a greater expansion of income inequality. hon. yellen: i'm sorry. rep. garrett: i only have a minute here. with regards to your balance sheet, i cannot get into all the details as far as your significant increase over time in the risk in the market. i understand the question was

already raised to you whether you do a stress test on yourself. the answer to that question was no. hon. yellen: yes, we have. rep. garrett: you do do stress tests? hon. yellen: we have perform the exercise. rep. garrett: do you believe that credit risks of your portfolio in the position that it is now is at a greater risk than it was before? hon. yellen: we have no credit risk in our portfolio. rep. garrett: you are immune to credit rate? hon. yellen: i think the u.s. treasury bonds are pretty safe investments. chair: the time of the german has expired. gentleman frommr minnesota, mr. ellison. i like to commend the said for keeping interest rates low. i believe it helps calm and strengthen our economy. fed hadish that the chosen to act as assertively and congressy -- i wish

chose to act as assertively and creatively as the federal reserve did. the truth is that without the federal reserve working, the fact that we have had absolutely no fiscal assistance around here at all. and i think if you look at the historic amount of attraction that we have seen, it is really quite remarkable that anybody can congress would be shaking a finger at the fed given how little we have done to try to stimulate the economy and help low income americans. if congress had funded and infrastructure bank, for example, and rebuilt bridges, schools, roads, we would have low unemployment and a stronger economy. lord knows we need it. lord knows our infrastructure is crumbling all around us. interest rates are at a historic low. we could really rebuild this

economy if we took some fiscal action. i would like to ask you this cherr., chair yellen. if congress improve this money for infrastructure development, with th what that have a positie effect on employment? how would it affect wages? how would it affect productivity if we had better, more improved infrastructure? hon. yellen: i cannot give you a detailed assessment, but i certainly would agree that productivity growth has been very weak. we have had a shortage of investment, private investment has been very weak. that is one reason that productivity growth has been so and generally having a stronger rate of investment. there are other things as well. education and training make a difference here and supporting research and development .

those things would contribute, i believe, to stronger productivity growth and ultimately faster wage growth. rep. ellison: if you look historically on the amount of fiscal investment, how does the era that we have been in for the compare, 5, 6 years with other. the fisca periods of physical investment? hon. yellen: i do not have the numbers, but i think it is low. rep. ellison: you are supposed to fix the economy? hon. yellen: we could use some help, thank you. rep. ellison: when you were here in february, you and i had an exchange on what the federal reserve could do to increase employment for african-americans. i wonder if you have any update for me. has the federal reserve been able to think about traditional policy toolkits to specifically consider investments and action that might impact african-americans, latinos,

native americans, and low income people? in addition to keeping interest rates low, are there more targeted tools that the federal reserve is considering or might recommend? of ourllen: so in terms general stance of monetary policy, we have seen a lot of improvement, and it has benefited african-americans in spite of the fact that there remain so much distress among african-americans in the labor market that concern us to . nevertheless, there have been improvements. we do not have tools in monetary policy to target particular groups. we want to have general improvement in the labor market in the context of price stability in the community development work that we do inside the fed. what weuite focused on

id low anda blo moderate income communities and try to identify and promote programs that seem to work. in my travels, i visited a number of work force development programs that i think are helpful in trying to match unemployed african-americans and other minorities with available jobs. job openings are at a record level and often programs that link up workers and jobs. sometimes there is a need for workforce training. we have done work and try to promote best practices in this area and credit availability more generally to low and moderate income people. chair: the time for the german from minnesota expired.

ze the recogni gentleman from ohio. >> i appreciate that you have a hard job. i want to ask you a couple of questions. you just said to the german from minnesota that private investment is lacking. it is clear that you have reduced the interest rates in the economy, which is one factor when people choose to make an investment, but at the same time, it appears that the increasing regulatory requirements, including capital surcharge on bigger financial firms has nearly doubled the financial average, 4.5% versus ratio, supplemental liquidity coverage ratio is more and punishes certain asset classes and a total loss absorbing capital requirement

that does not consider things like market making to give capital making in the economy. though seems like even you have reduced interest rates with your monetary policy, your regulatory policies are costs to make private investment and also doing it at such a level higher than the .est of the world it makes america a less attractive place to place jobs and other jobs. commented youe want to take a look. i really appreciate the european commission did a call for evidence to review their financial regulations are actually working and recalibrate the rules to support both andidity, economic growth,

lending. doyou have any plans to something similar given our regulations are so far out of whack with the rest of the international community? ms. yellen: our regulations with respect to banking organizations are not really out of line with international standards. whackwe have worked jointly with try anduntries to maintain a level playing field .nd race standards in tandem we have improved the safety and the soundness of the banking system. we have a banking system extending a lot of credit. credit is readily available to most corporations. loans have been growing and loansare eager to make

priced at low interest rates given the environment, >> clearly, interest rates are not doing enough, my point. answer my question. are you going to be opening up regulations the way the european regulators have or not? he said you will but i have not seen anything on it. will that happen or not? ms. yellen: we are going through the process and looking at regulations. to consummate the governor for his comments in the wall street journal recently that knowledge that small and medium-sized banks do not present the same systemic risk and he will therefore try to reduce their compliance cost. and boost those kinds of things. i love to see them happen. i want to come lament on his willingness to say he will do that.

the research, which is charged research on systemic risk, a year ago it shows the systemic risk, the sixth largest have anions overwhelming majority of the risk in the entire financial system. i think we should concentrate our precious regulatory capital on those that generate the andest risk for the system the folks that don't from the things that don't make sense. i was pleased to see the comments but i would urge you to actually implement those. ms. yellen: i am supportive of the things he said they are focused onto i agree. we want to do everything we can to eliminate burden for those banks. >> my time is almost expired. -- we have a

regulatory hearing every six months. governor is an acting regulatory supervisor, but i hope you bring him with you during that hearing which is coming up. -- thank you.n >> to ensure he does not engage in an act of pluto negligence, we grant him an action 10 seconds if -- for him to recognize the cleveland step in ship. [laughter] >> thank you. go cavs. i yield back. >> the chair now recognizes the german from south carolina. >> thank you very much. in your opening testimony, you said the following. of the court taking

a cautious approach is that the guidance, what weight do you put on the fact that other countries are approaching zero? how does that factor into your decision-making? the decision-making

of other countries is important in our decision-making. to the extent rates decline and lower, ours does tend to put upward pressure on the dollar, which is a drag. to the extent policies are successful in promoting stronger -- a stronger growth in those countries, in that boosted demand for exports, we need to take both aspects of it into account and it may differ from situation to

levels. congress told us to focus on maximum employment and price stability and that is what we are doing and what we will continue to do. >> it is fair

could be a very nice situation because it could be indicative of strong growth.." the last time i remember having extra ordinary high interest rates, there was no growth. we have had times in this country policies recent history of high interest rates and low growth. be ms. yellen: a good situation to be in. ms. yellen: that would be a much less desirable situation. i did indicate it is highly alikely and would require very unlikely set of circumstances. >> it is possible a circumstance would arrive where it would go negative? ms. yellen: it is possible. >> the chair recognizes the gentleman from north carolina.

>> thank you. i would like to make a comment whoeference to my friend stated you play the most important key role in terms of our economy and the increase in jobs. you have mentioned 14 million jobs, a very accommodating monetary policy. during this administration. the contest i would bring this to you is we had 20% interest rates, high inflation and high unemployment, and the regulatory burden was significantly reduced and the two years, we are creating 400,000, 500,000 jobs a month. don't you see clear contrast in terms of the regulatory burden put on the economy today and how

that is not achieved and desired . i see their green shirts and expressions of hope and yet the very policies, it seems to be counterproductive. his supervisor to stress tests a futurenor announced exercises. failed torned the fed consider any benefit to adding this as a component. , failurenents unique scenario.

an instantaneous global market shock her according to the analysis, both of these existing components already make up a significant portion of sir calculation, including on issues in this complexity and cost or additional -- jurisdictional activity. you believe this is in essence a double tax? i think congress intended for firms. those firms can go on serving the credit needs of the country.

in the static requirements, the leverage ratio, capital requirements, we have added an extra level for those firms. >> what then is the net added benefit of adding the surcharge as part of the exercise? what do you see the benefit to that? >> a forward-looking exercise in which we look at how the firm's would perform and survive in highly adverse circumstance. >> you do not see this as an unnecessarily added burden? >> of me just say we are doing a five-year review of the stress and we will probably make other changes as well. it could be partially offsetting. >> one comment about community

banks. the federal reserve bank, made comments regarding his contact with the community bank and getting a loan in his comment saw an extraordinarily painful process. say these banks severed under a new regulatory regime he added the notion of too big to fail and last regulations on those not at thatmic risk, he supports philosophy. i want to emphasize again, the real issue of addressing the , there is not additional community banks being formed because they do not see the ability to support the

requirements of the regulatory burden, i would emphasize that to you. >> the chair now recognizes the , capital new york markets subcommittee. >> thank you. here in february, i asked you what is the decline in inflation expectations to historic low levels had caused inflationhink objections. you said it is something you aren't evaluating closely. since february, inflation expectations have fallen even further. why do you think inflation expectations have continued to decline? ms. yellen: some measures have declined and others have not. serving measures like the michigan survey of have declined.

professional forecasters surveys, we do not see a decline. that, but the on decline we have seen in energy time maying back some be influencing perceptions. we have seen declines since i was here last in what is called inflation compensation, market-based measures of the extra yield investors required to hold longer dated treasury nominal securities. that is not a pure measure of inflation expectations. risktations of inflation and the value given the global attached, theyrs

may be playing a role. we watched this carefully , but core can feed in inflation is now running about 1.6% in the last 12 months and has moved up some. headline inflation has moved up as oil prices have come up some and stabilized, the dollar is stabilized. we need to keep track of this. risk but inflation is behaving largely as i would have anticipated. long do we have to go without an increase in inflation expectations for you to reconsider your plan to gradually increase interest rates? ms. yellen: we're watching inflation and inflation next thing patients. measures, in spite

of them declining further, actual inflation is moving up and roughly in the manner we expected. we are watching the labor market as the labor market tightens, and we see pressures developed their. we are contemplating further increases in short-term rates, if things continue as we expect. inflation back to 2%. we are committed to that but we want to make sure that inflation does not rise to the point where we compromise stability either. >> i am concerned about the recent cyber security breaches involving swift in which hackers successfully stole foreign banks swift credentials and then initiated fraudulent fund transfers from these foreign banks. as you know, i sent you, the

fed, a letter last month, asking what your agencies are planning to do in response to these truly unprecedented attacks. on the give us an update banking regulator response to these attacks? are you concerned the cyber attacks can undermine confidence in the international payments system? even though the hackers had not successfully stolen the swift which,ials, u.s. bank, what effect could this have on the u.s. banking system, is certainly rattled me that this happened, and as you know, the federal reserve is one of the 10 central bank that collectively overseas swift, what have the fed done in its capacity as a regulator of swift to respond to these attacks question mark if i go to a foreign country when i'm not expected to be in there, my

bank stops until i tell them it is ok. it is quite unbelievable that such a large amount of millions of dollars can be transferred to sites including the casino in the philippines. i think this is a threat to the u.s. ranking system. >> fed systems were not compromised. looking at their processes, looking at best practices, looking at the possibility of enhanced monitoring for certain kinds of transactions. we expect institutions we supervised to make sure they with control access to critical payments services and review and ensure that their meeting security requirements, we do participate in an oversight arrangement run by the

bank -- >> the time of the gentlelady from new york has expired. wishes to advise members took out eight the schedule or chair intends to recognize three more members, currently it would be -- the gentleman from kentucky is recognized. >> thank you. welcome back to the committee, chair yellen. recently announced a link in liquidity problems in treasury's corporate bonds, and asset securities. he stated liquidity requirements whiche largest dealers, have been raised significantly since the financial crisis, israeli tory changes have like activities and consequently the provision of market liquidity.

do you agree market liquidity has declined since the implementation of post crisis regulations? -- yellen: it is different difficult to tell her by many measures, market liquidity remains adequate. we have seen evidence that under stress, liquidity may disappear. there are a bunch of different factors that may be relevant to that. regulations are on the list. i'm not precluding a role there but there are changes in business models, high-frequency inding has become important thetreasury market. >> let me interject. do you agree with my colleagues retention, some of the andlemental level ratio some of the other requirements have decreased trade sizes,

resulted in fewer asset trading this offense, that there is a transfer of market-making activities out of highly regulated banks and into the less regulated shadow banking capacityhich has less to act as a liquidity provider? ms. yellen: i did not know he said that -- >> i got more specific than he did but that is what is happening according to the market -- ms. yellen: you put a lot of the things on that list and i am not aware of any research that or would look into this phenomenon. thatot aware of research documents with the role is of any specific regulation. something we will look at --

>> i asked you how the fed would up to fivetaylor, times the amount already required. one says trading asset backed securities would become on he can model -- uneconomical. to ask foreconomical mortgage backed securities or residential back to mortgage backed securities, auto loans, credit cards, loan applications, if banks pull out of the marketplace, $1.6 billion source of consumer lending. that going? you indicated to me four months ago that you were taking a look. how is that going? ms. yellen: i need to get back to you with further details and i will do that. >> thank you for doing that. we need you to take a look at it

. it is very important. to conclude, in your prepared remarks, you indicated that business investment was surprisingly weak. isbe the reason why the fed surprised and continues to miss on forecasts and the fed at the wall street journal pointed out estimated 2.4% growth, and that have fallen to 2.2% in march and a last of this month, it was down 2%. following the consistent record of forecasting error from the standpoint of getting stronger growth than is actually occurring, maybe the reason the fed is missing out on these forecasts is you continue to view fiscal policy as a small positive when it is obvious to thatbody in the economy overregulation is producing down 2%. liquidity. you are cognizant of keeping

interest rates low and putting off raising rates. it seems contradictory to the lack of attention that the fed to beginning to economic recovery. i would like you to comment on that. ms. yellen: growth has been disappointing to her and i'm not sure of the reason. the forecast of the and employment and the labor market and ween pretty close have seen a lot of job creation, firms that are doing relatively little investing are doing a lot of hiring. >> the time of the gem and has expired. recognizes the gentleman from pennsylvania. >> thank you. my colleague touched on this. i asked you previously about the ability to accept deposits because of the supplement.

leverage ratio rule. i would like to follow up by is the fed studying or analyzing how the supplementary leverage rule is impacting the banks ability to accept deposits? we will look at that and i am aware of concerns around that. ?> there is no current study we don't have a study underway but you are talking about a handful of bangs and the impact this has on them. aware of the concerns around us and we will look at it. >> if a bank is charging at deposits, that is the equivalent of a negative inch straight, would you agree with that? that bank for that >>. >> if custody banks are unwilling to take banks, where with the cash go? mightea where a customer

put that cash? ms. yellen: in a bank that is less constrained. >> both use the same threshold to determine whether and to what extent financial institutions. any institution with more than $250 billion in assets is subject to the full version of these roles. you indicated the full version of these rules should apply to only those institutions that are internationally act of. you indicated an institution could be considered as such writ -- if it has more than $200 billion in total assets, even if it has limited activity. can you explain why a bank should be considered internationally active even if it has only limited activities? not suren: i am

exactly which firms you are referring to. i do not have enough detail to tell you. i will get back to you. >> we appreciate it. any firm with more than 200 $50 million would be deemed to be internationally active. that is what we would be curious to learn. aboutked a little bit headwinds last time you were here, to the economy into today. the fed is not operating in a .acuum you know, there has been a discussion about any number of issues going out there. you would agree low-interest rates themselves are not a headwind. rates, youchurch expect much more robust economic growth. testified that you expect headwinds to slowly fade over time.

headwinds aree regulatory and we have had a discussion today about the regulatory impact and a number have raised the issue. are hearing it from our constituents back home, small businesses. the regulatory and fiscal policies us administration has again, the fed is not operating in a vacuum or higher taxes, the affordable care act, epa, dodd-frank regulations because dodd-frank it self missed the mark. would you consider any of the regulations for fiscal ms. yellen: policies be headwind to the economy? i would say productivity growth and growth in the capacity to supply goods and services is pretty meager. we are not sure what the cause is here that i would point out it is a global phenomenon we are seeing in many parts of the

world. you also see other countries imposing other regulations on their economies as well. ms. yellen: the reason the man out all be the same in different countries. concerned because you talk about headwinds and it you are not diagnosing the full scope of what those are. as we look at the performance of at thenomy, looking constituents i talked to, they have not seen wages and small businesses not seeing assets in capital. thosee to look at what headwinds are and we have to do that. i yield back. >> the gentleman yields back, the gentleman from texas, recognized for five minutes. >> thank you for being here. i'm from texas, a small business owner and i have been for 44 years. i appreciate the testimony. we had a chance to chat about

committee based financial institutions. when i go back home, what should i tell the committee magazine and credit unions who feel they are being targeted for the financial collapse of the economy, and what you said was you are trying to do everything to relieve burdens on community banks that have been through very difficult times. one year later, community bank the dodd-frank act has more revelatory restrictions. over 27,000 restrictions for all laws passed through 2014, clearly someone around is not getting the message. is it more difficult for a small institution to comply with new regulatory mandates that it is for a largest tuition? very small a restitution we would recognize

are burdens involved. we have tried to tailor our regulations so there is less burden and fewer rules apply to smaller institutions. there has been an increase in capital standards that applied to those institutions. most things we have discussed , stress test, other things, liquidity regulations, do not apply to those institutions at all. we have tried to make many efforts and will continue looking for ways to simplify the regulatory regime and the capital regime for those institutions. >> have the number of regulatory changes affected the financial

institution's ability to consumers more than it has affected larger institutions? i do not know it has affected smaller institutions more than larger institutions. >> i would submit it has and i wish he would take a look. i do not really know how you started a business in this economic environment. how do people get started, i do , or how it is able to remain profitable. one thing you said earlier is can secure credit and capital. i am a main street person. i can tell you i do not see the opportunity to get capital and start a business with main street. let me close by saying this spirit i ask these questions the federal reserve is responsible for the right with tory oversight of 5000 banking companies, 800 depository -- i personally have heard from banks in my district of the regulatory

burden, it is contributing to increase consolidation. would you please explain the negative consequences that result from consolidation and effects of consolidation in on national economy? community banks are important in supplying the kinds of services to their communities that may not be readily available from larger institutions, and i agree it is important they remain healthy and vibrant and able to thrive and contribute to the growth of their communities. woulducing regulations help that, i can tell you. please take a look. mainstream america is hurting. there is a difference between main street and wall street that i yield my time back. >> the gentleman yields back to

it i wish to thank chair yellen for her testimony today. all members will have five legislative days to submit additional questions to the witness to the chair which will be 42 the witness for her response. i asked chair yellen to respond as promptly as you are able. all members will have five legislative days to submit extraneous materials to the chair for inclusion in the record. this hearing stands adjourned. >> fed chair janet yellen just wrapping up her second day of congressional test money. some of her comments include inflation saying that watching inflation as well as inflation expectations and despite metrics decline further, actual roughlyn is moving up in the manner expected. she discussed her worries over productivity growth saying it is meager and she is not sure of the exact cause.

racialof questions on and wealth inequality specifically, the regulatory burden on small biz and small banks. will continue to monitor whatever headlines come out of this but so far, it is limited. >> something we already knew going into the senate. we will do a quick market check on duringt is going janet yellen's's testimony. julie hyman is looking at all of that. >> still in a tight range. the market event of the week remains the u.k. vote. tomorrow is not necessarily what janet yellen said in the past several days. she tampered some of her comments today, which said the fed looked at whether there would be an economic recovery and not when. today, she talked more about being hopeful, weak employment numbers. all major averages have turned lower.

a tight range but more of a downward bias now before she began speaking. if you look at the chart of the s&p 500, we saw a light lower taken after the results of yet another poll coming out of the u.k.. that saidrom a firm there was a 44% remain vote and a 45% lead vote. now we're seeing another leg down. it is not clear what is driving thes volume is 10% below the 20 day average. .ook at the market we have the polls on the one chart of theave a u.k. exit odds, which have stretched lower. let's look at the pound index. this goingke we have on any see the light lower and the pound. i got my order confused, a different one than i expected here it back to you.

>> for a full wrapup of janet yellen's testimony, let's bring in -- of bloomberg intelligence. i want to start with you on the productivity angle. she returned to the scene several times often unprompted. why is janet yellen expressing worries over productivity right now? >> they are unclear about what is causing it. there is a limit to what monetary policy can do about it. limitingity growth is economic growth and limiting wage growth. this came up in one of the question that wage growth equals inflation plus productivity. if inflation is running at about 2% in the productivity growth is running up .5 percentage points, which is very low, we're seeing wage growth as well. as such, it could limit growth in consumer spending as well.

and broader economic growth. alix: the issue of productivity is if it is a demand problem, that means at some point, are all of these guys going to have to fire the workers they just hired over the last year and a half? we're seeing gdp growth level off but payroll gains continue to decline. >> she alluded to that in her reasonny today that the ist might be behind payrolls it is an indicator. growth inak economic the first quarter of the year. with growth rebounding in the second quarter, we might see a rebound in payrolls later this year. it is a positive sign that slowdown will be a gain temporarily. >> got it. the members speaking are much

more diverse. a lot of questions on small businesses and medium enterprises as well. the effect of monetary policy and increase regulatory burden on these companies, you have a great chart that you rock to us. on small business off to him index and the single most important problem for these small businesses. you found it is taxes and not financing that is hurting the small businesses. >> absolutely. i was referring to the small businesses. they ask a question -- what is the most important problem? this is not really financing or the availability of credit. taxes, different other problems. the most single important is the that is rising

availability of skilled workers. the're worried about skills. they cannot hire who they want to hire. the opening rate versus the higher rate, the gap has been widening. they do not have the workers they need. >> absolutely. the recovery has been really different in that respect. we can see vacancies are on the rise. it leads to hiring rates. the reason for that could be that steelworkers are not as available as somebody would like them to be. much.t: thank you so an economist giving us perspective on janet yellen's's testimony. there is just one day left

before heading to the polls about whether or not to stay in the european union. the race is too close to call. the most recent opinion poll edged the cap has a slight . the next guest believes that the brexit is the best option for the u.k.. calling joe weisenthal also with us. let me start with you first. >> we met the decisions here and especially the decisions about who lives here. the big issue for me and the big issue for large numbers of people across the country tomorrow. >> the brexit, that is fairly rare in your party. whohermore closet grexit's

think -- who have been unwilling to come out, even who questioned whether he is really as to the idea as he has perhaps stated? >> we are finding a significant number of labor voters coming out for leaving the european union. silent, who remain would support leaving, it is bigger than those who have spoken out. i think we are pretty representative of a majority of the people who vote later in the country. >> most labour mp's are sticking to the party line. to vote coming through theyursday, do you think will start switching their opinions? >> if there is a grexit vote, we're out and what we attempt to

do, we will be successful, trade agreement and good all-around without all of the political superstructure that goes with it, which is isre the european project going so badly wrong, not just in this country, but elsewhere. do not want to be part of a european country. they do not want to be a part of the night is severe. they want to be part of their own country. the vote on thursday is not binding so parliament could choose to do something different. >> in the real world, the vote is binding. think if we vote come out, germany in particular, as they have been saying, will negotiate because they sell

far more to us then we sell to them. it is in their commercial interest. the majority of people in britain, no problem with that. that will then happen. scarlet: one thing that is interesting is the geographical divide between those who support them. is backed by eurosceptics who live in england. most in scotland, wales, london, support the idea to remain in the european union. do to british unity if there is a vote to leave the union, and yet you u.k. in most of the support of leaving >> whatever

the result, they will vote very similarly. the result is far closer in scotland and people realized it was going to be. she is a big divide and a fascinating one between the middle classes and working classes. that will i think become the very difficult polarization we will have to be dealing with, whatever the result here working classes voting to leave in the middle classes hugely voting tuesday. i have said it many times, it is because the middle classes getting the benefits and the working classes are getting the problems. alix: thank you for joining us. joe weisenthal is joining us as well. coming up, a full hour >> it special. we will speak with robert. stay with us for that. and still ahead, will they stay or will they go? one day to go. what a leave could mean for the european market.

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alix: we are just one day away from a vote on a exit. what could this leave mean for european equity markets? we want to go to cory johnson and carol massar on bloomberg radio. carol: thank you. we want to talk to our next guest about brexit. chief executive officer at the assets stock exchange. he joins us in the studio. theave been obsessed with potential of the u.k. referendum going in the way of the u.k. leaving the eu. what are your expectations and what could specifically the on the greek investment and greek business environment?

>> first of all, hello. thank you for being here today. have seen last week the volatility to be increased in the greek market. we are well prepared. history in the past years. our market is driven by investors. 60% is owned by foreign investors. anxious about what will happen with the brexit. i believe that situation after the unfortunate event has in the sentiment has changed. i see a lowering of volatility of markets. that means the situation is different than what it was. carol: you assume the referendum

will go in remaining the union? >> for capital markets especially in europe, it is an important issue. know the familiarity of the u.k. is the highest in all of europe compared to the mainland. is thebanking sector , investments to companies. cor even ify: brexit were to remain, the last oppose this would still be there. i wonder if there is a lesson in greece last year with the turmoil that greece went over and its relationship with the eu. >> yes, you are right but i least in thiselieve at situation, the economy of europe at this point in time, it is

mainly to utilize a mix between markets and the financial banking sector in order to share growth in europe. according to the discussions , it have opened to brexit has been faster in europe. this is a positive approach for the discussion we have seen up until now. carol: the market environment, .5% this, up about year. expectations.

gdp in the country's negative one point 3%. you have got high unemployment that continues to plague greece. how do you turn it around at this point? >> i think the most important issue that everybody is aware of how can attractive investments in the country, this is the reason why we are here for what we are organizing and we have the support of the development in the economy. >> what kind of feedback are you getting? investors going to commit to greece? >> i must say the numbers we see now are similar to 2012, the grexit at that point. when you seeside, you musticipation, expect the stock market, when you see low participation, they are much more successful, let's say. messagee a positive

that we do not have anticipation like the previous year. carol: may be but you're not certain. we have to leave it on that note. thank you very much. chief executive officer at the stock exchange joining us here. back to you. alix: thank you so much. you are also listening to a live shot here of the rally in birmingham, england. vote tomorrow, david cameron is speaking there at the rally. >> businesses large and small, world leaders and universities, everyone saying our economy will suffer if we leave. the response of the lead campaign? it is to say -- ♪ you guy's be good. i'll see you later

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headlines this afternoon p or mark crumpton has more from the newsroom. hill, houseitol democrats are staging a sit down protest to force a vote on gun control measures. a group of about 30 lawmakers led by the georgia congressman demanded a vote on the measures before sitting down and occupying the house floor. he said, we have been quiet for too long. the house was not in session when the democrats held a demonstration. republican leaders ordered c-span cameras turned off. donald trump says the country's problems can only be fixed "by me" and not by hillary clinton. secretarycalled clinton a world-class liar and slammed her and her house and for using their public-sector influence to enrich themselves. mr. trump: the other candidate in this race has spent her entire life making money for special interest and i will tell

you she has made plenty of money for them and she has been taking plenty of money out for herself. hillary clinton has perfected the politics of personal profit and even theft. the state department like her own personal hedge fund , doing favors for oppressive , inmes and many others exchange for cash, pure and simple, folks. mark: mr. trump called on supporters of bernie sanders to call -- join his campaign. most half of senator sanders supporters say they will not support mrs. clinton according survey. 22% of sanders supporters say they will vote for donald trump. 18% favor gary johnson. sanders has yet to formally endorse mrs. clinton. the united states -- united mesa for as funding

by august.tribution the organization -- it is a glorious day in by august. -- organization cleveland thousands turned up for the cleveland cavaliers. the first time in 52 years that cleveland has held a parade. global news toy four hours a day powered by more than 2600 journalists and analysts in with an 100 countries. scarlet, back to you. chair janet yellen wrapped up two days of testimony at this hour. to central bank's plan proceed cautiously in interest rates. erik schatzker sat down with the

morgan stanley president and asked him about the central bank's plans in these uncertain times. >> we assume very subdued markets for the time being and it just rates for the same -- for the foreseeable future. if we get improvement in that scenario, we will benefit well that we have assumed it will be a very flat growth world for some time. central banks will continue to be active and rates will stay low. >> is that to say at the idea that the benchmark interest rate in the united states according , calling forasts it to be at two percent by the and of 2017, it is just not in the cards? >> personally, i do not believe it is. i think the u.s. is showing good underlying trend growth and chairwoman yellen is referring to external financial conditions. brexit would be a very major change and it is hard to see how

central banks around the world would be anything other than a calmative in the event of that sort of shock. i think we're in a world that trend growth's 3% and that is being challenged. 2.5% is when you are at recession levels in a global growth. you may see a movement toward that. in that backdrop, i do not see how central banks do anything other than what they are doing at the moment. said yesterdayen that roque -- low rates here and because ofe partly the market volatility and sudden forges in investor appetite risk we have seen particularly in the early weeks of the year. what do you think question mark >> clearly, low rates force people to look for alternative investments and by definition, that creates asset bubbles and we have to keep an eye out for those risks. we have no choice but to lower rates at the moment so that is a necessary risk to take. i think there are certain asset

classes where you are approaching bubble type valuations. i do not think there is any systemic risk in those asset classes. >> if in fact we are in isblelike conditions, that losses for the people who choose to say -- stay long? which are you talking about? the fed pointed to commercial real estate and said equities are getting stretched, do you agree? >> equities is interesting. a global dynamic in terms of the earning mobile's themselves are too high, probably not, but can they expand? if you do not see an expansion, by definition, you have a valuation issue. >> the election here looms months away which we talk about incessantly. it is affecting risk appetite and business decisions for sure. what do you specifically see among domestic and international clients? >> i will not comment on the u.s. election.

as an irishman, i think that impertinent. we have generally seen a big falloff in volumes and you are seeing that. uncertainty in the u.s. and down outlook. it is china and oil and a number of things causing people to be nervous at the moment. we have seen a significant fall off and some would argue a secular change. >> which is to say that if the issue is resolved favorably, which is to say that britain member of remain a the european union, that does not remove a cloud of uncertainty. what will it take for a decline in volumes to return? isfirst of all, if there rather than a grexit, you will have a small relief rally but you're right, it is significant and it is just one thing you take off the list.

ofneed a normalization economic activity which means a withdrawal of central banks. >> how many years away are we from that? >> i am a notorious air, as you know. a couple days at least. coming up in the next 20 minutes, immigration is front and center for the brexit vote in the u.k. tomorrow. look at how immigration is impacting canada's economy next. this is bloomberg markets. ♪

scarlet: let's get a quick check on u.s. stocks right now. you have the s&p 500 little changed.

industrials living 20 -- losing 26 points per janet yellen's testimony not moving the needle. for the dow upe 12% lower than it is for the 10% average on the day. who will want to put on a big position? abigail doolittle is reporting live with the latest. abigail: the nasdaq little changed after trading slightly higher for the session. that is the best sector today. biotech a little bit. up 1%, nicely higher on the news that the medicare panel to cut costs has not been triggered. the gains may be fair compared -- considering some say there is

a lot ahead for biotech companies including the campaign trail. ,he big drag on the nasdaq tesla shares are down sharply as investors are digesting the news yesterday that the company is city byg to buy solar nearly $3 billion in we have shares of solar city up modestly at this point and a lot of cynicism around this proposal because of the link of the tesla also being the be a shareholder of solar city, plus a lot of uncertainty created the deal on top of uncertainty already inherent to the tesla story, including whether or not the company can meet huge production goals and how will they deal with high cash burn? caused this uncertainty rush to downgrade or he prefers to be on the sidelines. a bloomberg intelligence analyst is pretty positive on the fundamental vertical integration but says the timing could not be worse, that this could have and should have been a rainy day

project, after the launch of the model three due out next year. there is a high bear short interest, about 25 percent. some investors are probably pleased by the announcement and the trading action. that is more uncertainty in an uncertain story. the tension between the bulls and the bears, take a look at the chart, which signed -- which side is winning out? abigail culinary maybe for the long-term, slightly more bullish. is main thing for this chart that uncertainty between those bulls and the bears. the reason it is moderately alleged is the buyers are slightly stronger than sellers plus we have the stock catching jesse mayine support, be the buyers will be able to defend this one but a lot of uncertainty around tesla. alix: thank you for joining us from the nasdaq is scarlet has a preview of bed bath & beyond's

earnings, out after the u.s. close today. scarlet: the backdrop here is that amazon's reach is cutting into that retailer's business and investors are nervous. you have got shares down about 10% year to date. let's see what the numbers tell us in the numbers do not lie. with sales exceeding 12 billion dollars, bed bath & beyond is the biggest u.s. retailer of home furnishings and domestic merchandise. revenue growth has slowed dramatically to low single digit growth. sales,ith decelerating both moving clearly in the wrong direction. last quarter bed bath & beyond posts they same-store sales gain of 1.7%. that is at the high-end of the forecast. gross margins, the orange line is still falling more than 100 basis points because of markdown's, couponing, and investments. the negative trends are expected to continue this year while free cash flow will be pressured by the increase in, seen right here to remainr fights

competitive. is up almost 80% since 2010. it makes sense to devote resources to technology as digital sailors -- sales growth. it is a driver of comparable sales. you're looking at a snapshot of comparable sales drivers. even as e-commerce picks up momentum, morgan stanley estimates retailers continue to grow their store based by 2% each year. that bath and beyond is in the category, topping 1500 across north america. we will watch all of this and more from bed bath & beyond today when they release earnings after the closing bell. alix: thanks. great stuff. question plays deep rich -- deeply into the british divide over a grexit -- brexit, their debunking claims that -- pamela joins us now with more on demographics that created a need to put immigrants to work in canada. pamela, tell us about the data.

synthesis canada has come out with this information telling us that canada is entirely reliant on immigrants for labor growth. the growth we are seeing in labor markets are very much tied to those who immigrated to canada. many people retiring and then those jobs are opening up. is other trend playing out the commodity side of things. in thebs have been lost oil patch. traditionally, we have had a lot of immigrant workers in those jobs which may be play into what we are seeing. that are deployed in canada rose by about a 6% increase on a yearly basis. back to 2006,goes so it has not been collected for that long. if the trend continues, it would mark the first annual decline outside of a recession for

nativeborn canadians getting jobs ahead of immigrants. immigrants very much responsible for labor growth in the country. >> to what extent have companies began to market to americans for political reasons? >> it is an interesting story and it did spike through march and april. bloomberg did a story, looking at a story in waterloo, ontario's silicon valley, if you will. and directly marketing via facebook and so on, saying we would love people and silicon valley, the politics, the political environment, if it does not go your way, consider coming to canada. all things aside, think of us if you would like to get jobs. we have seen that die down recently but it was interesting as a way of play into what canada is trying to do to reverse range rain drain.

a lot of canadians going to silicon valley and other tech hubs in the u.s. one play on that. pamela, thank you very much. pamela joining us. scarlet: time now for a look at some of the biggest business stories in the news right now. goldman sachs is funny to dismiss 98 employees in new york starting next month. a third round of layoffs at the firm. according to a notice with the department,s between july 17 in october 29. alix: 11 $.2 billion in punitive ofages arrive in the gulf mesko oil spill, will become available to property owners and fishermen. the money is from a pending settlement in a role in the disaster. both oil services companies. damagesl pay punitive in addition to actual damages. >> that is the bloomberg business flash. up, just one day to

go, what impact could nasty weather have on the outcome? you know it will rain. we will discuss. ♪

scarlet: as we mentioned, the clock is ticking for tomorrow's writes it out. a outcome is too close to call. it may come down to whether. there is a weather function for w etr go. we have london up and for thursday, june 23, the forecast is for 66 degrees. the cloud of rain, it is london after all. .4 inches of rain for the day. weather is a little bit warmer. yesterday, we spoke about the impact of the weather on the vote. meteorologisthief

at the weather services division. here is what they had to say. >> in the case of the vote, we will look at young people more likely to stay home in the case of bad weather. the reason is there was a huge jump in voter registration for this referendum. young people are less likely to vote in general and have generally been less animated. the camp has less of a really cap.ts based in the lead whether the league camp could expand that based to a majority is another russian, but i think it is true that the 50th percent vote for that camp is much less .ikely to vote >> going back to history, what is the relationship specifically? >> it all depends on the country. there is no real kind of clear thing we have found so far in britain.

about 1% less turnout in those regions. there is heavy rain in florida and democratic turnout was lower than expected. however, in sweden, no whatsoever. people do not have work they are more likely to vote regardless. their increased odds that the -- willwill tell you place on impact there. >> that is remarkable. alix: how would the weather affect undecideds? the week was aof weather is bad and it will be slightly worse than the camp, because of the geography of the vote. how much worse is in question. can you be more specific in terms of where we are more likely to see rain? >> london and far southeastern england are the only regions where we could see enough rain turnout.

in the northern parts of the u.k., there used to late showers this time of year. we really see anything that would turn out the way we are seeing it right there in london and the surrounding summers. atwhat are you looking specifically? >> cable, however you want to refer to it, a massive run-up over the last week because we have seen a wave of polls deciding undecideds are rising. means is probably there is a very well established to 1994,oing back 2014, of the status quo option, a big jump in the ballot box.

that is priced in with the equity market and the fx market as well. scarlet: his colic is a chief meteorologist ethel -- at the weather service commission. i was talking to a guy, an unnamed source, and perhaps it could come down to the weather, people want to gain the vote so badly, they are looking for any kinds of clues to help them. thunderstorms and the rain. pretty much what you might expect for the case in london. i love what he had to say about historically, there had to be a little bit of correlation. >> you would have thought it was for older people. the older people will go out and be much more pro-brexit than the

younger kids, which does not make sense. i love the phrase for that. see if it changes tomorrow. >> coming up, a full hour break special for you. we will speak with robert this afternoon at 4:00 p.m. eastern. we will talk at reason currencies in all types of stuff when it comes to the u.k.. up, bradalso coming sherman of california will join us to discuss janet yellen's testimony on capitol hill earlier today. this is bloomberg markets. ♪

>> and it is 2:00 p.m. in new york. >> welcome to "bloomberg markets ."

>> from bloomberg's world headquarters in new york, 12 hours until the polls open for the brexit referendum in the united kingdom. relief rally if the u.k. votes to remain? >> what will happen to the pound sterling. has advice on how investors can protect themselves. calls donald trump hillary clinton a world-class liar. clinton will liver a speech later this hour. close in about two hours. >> markets are in mixed territory. brexit