scarlet: u.s. stocks closing higher this afternoon, the dow closing up for the ninth straight day. -- longest winning straight winning streak in more than three straight years. we've seen earnings from big tech names, and today, we get numbers from intel, qualcomm, and ebay. plus, turkey ratings cut by s&p. we asked our guest with the coup attempt means for long-term growth projects. the: and gm's ceo considers country's largest automaker undervalued by investors. we begin with our market minutes -- dow and s&p 500 closing at record highs. this is the longest winning streak since 2013. if you break down different industry groups, six out of 10 were higher.

tech was clearly one of the best performers with the nasdaq the biggest gainer out of the three biggest benchmarks. joe: absolutely. kind of unusual because we have this modest dow game that really the tech performance. matt: we do have a seventh consecutive day of dow jones records, nine-day winning streak but seven days in a row, we hit a new all-time high on the dow, not something we have seen on the s&p. dramatic.it be more it's much more dramatic if you look at a longer period. i also wanted to show you microsoft. scarlet showed me this earlier, sans going to rip off one of the functions she sought me -- she .howed me how to use it's the probability of certain moves, so we can see on the far intela big move here in

shares. they were up almost 7% today, which has only happened one time since april. you can see it's basically three standard deviations away from the mean. >> it fell to its lowest level since 2011, and there has been a let-up and the insatiable demand for government bonds. yields are so incredibly low, there has been a pullback in demand amid this rally. as wen see the same thing look at u.s. 10 year yields over the last week, continues to increase higher. low levels, but the insatiable bid has pulled back. and the turkish lira has resumed its selloff, now approaching $3.10 per dollar. before the two it was less.

they are downgrading turkeys credit rating. take a look at the lira over the longer term and you can see the movement south in terms of value. because it isup an dollar appreciation versus the lira. that traders see it weakening by another 8%. it may be far from over according to traders. we do have breaking news for $.59, and gross margin, which is a key measure of profitability for intel, 61.8%. that is better than analysts have been looking for, a were anticipating 61%. line, $13.5 billion. as for this current quarter, they have seen third-quarter revenue of $13.9 billion, plus or minus half $1 billion there.

in general, analysts were looking for $14.6 billion. that pretty much puts it right in line. it gives will room -- wiggle room. and, -- stock is up over 10% in just the last month, so it has been on quite a surge. matt: we are also getting 16lcomm earnings, one dollar -- $1.16, so really blowing it away. the big thing for qualcomm is not the current reporting. the important thing is, what qualcomm sees going forward. $1.05,ecast is now for though the estimate is for

$1.08. it is more to the upside event of the street's estimates. do they lose out on apple, smartphone? the highere out on end because that is a big margin for them. we know they are getting killed at the lower end by chinese competitors, so they really need to do well in this business. apple is leaning toward intel for the iphone seven. beating on the third quarter, you can see them beating it by a mile, the shares are 4.5% in the after hours. the outlook is pretty positive, compared to an estimate of $1.08. coming: american express in with shares of $2.10, better than analysts were looking for. the highest analysts estimate was $2.11, just a penny shy. second-quarter revenue coming in

the 8.2 $4 billion, shy of what analysts were looking for, $8.46 billion. million, at the high end of the range. express, it has lost a valuable partnership with costco and jetblue among others. how lot of questions about effective it is in terms of bringing costs down and making ,t possible for its customers such as costco or jetblue. because it targets were high. to see aare starting lot of big-box stores and companies yield their own power. has nothing to do with american express, but with a visa kumutha walmart in canada saying they would no longer accept the high rates they're trying to pass through.

and the problems american express was having with costco worm much more embarrassing. let's get back to those big tech earnings, we want respective from cory johnson our bloomberg media editor at large. we're looking at shares of intel down 2.9%. what do investors not like about this earnings report? cory: if you wonder why they beat the analyst estimates, it is because they came down this week -- it is only wednesday. the number on friday, they would have missed that number, which analyst6 billion. one lowered his numbers, and as a result they'd beat the estimate. but there were only released on monday so this is not substantial. you can see on the bloomberg i going into the equity eeg which shows you the graph, and you can see that number. interestingly, what is going on is the server business.

best marginse very of any intel business, 49%. down to 40% with the results today. so more profitable than at the internet of things, or the tc business. 40% operating margins is good news if you can grow. no way are they growing this into the mid-teens. the is almost as bad as last quarter, which was not seen a very strong. intel said we will benefit from the cloud i being a data center, but data center growth is now below 5% on the year over year basis, and that is not good news. joe: intel says it remains cautious on the pc market. and this is a legacy business, and no one is surprised that that business is not thriving. how much is that dragging them down, and how well has intel done ultimately to diversify away from it? cory: intel has done amazing

things. they saw it happening with the pc, they started building and internet of things, they're ramping up and cutting costs and cutting prices and raising efficiency of chips to read in the meantime, they have this pc business that peaked in 2011 and continues to be in decline. what they did initially was gain market shares. no moree is really market share for them to win in that arena. and you're seeing the results in terms of market share, they cannot compete there anymore. as a result, the contraction of business hurting them. hopefully servers will make up for that, but i guarantee you, the questions will be about what is going on with the data center, how to keep it, is there worry about semiconductors, that is happening, and what can intel do their? they can certainly help them sell value mints -- help them

sell. rate, a slowing growth certainly going to be an area of focus. if server margins are twice as big as pc margins, do you think that the server or data center business taking off is more and more the things we do on our cell phones? it is less important if they choose apple -- if apple chooses intel for their phone because everything my phone does have to go through the clouding use their server chips. cory: but they have $1.8 billion in profit. they sell so many more pc chips. they make more profit by selling pc chips. look at the model, they did $1.8 billion in profit in servers, $1.9 billion in pc. they are selling so many more, even today. we are at the point where the

server business might be more profitable to the pc business. that is why it is such an important focus. they are neat -- nearly equal in terms of profit. cory johnson, stick with us. we're still awaiting ebay results, we can tell you they are off by 2.6% in extended trading. ♪

mark: republican presidential

nominee donald trump is in cleveland with his family, he was greeted by hits running mate, indiana governor mike pence. it was their first joint appearance at the convention. to convince conservatives to support mr. trump and introduced himself to the nation, to whom he remains relatively unknown. secretary of state john kerry says momentum is shifting against islamic state. of iraqoke in support at the state department, he said the real challenge lies in securing the areas that have been reclaimed from isis. he also says radical islamism cannot be defeated by military action alone. the u.s. is cohosting the conference with canada, germany, and japan. scientists in the search for the areysia airlines considering the unthinkable, that they may have been searching in the wrong place for more than two years. they have been searching the indian ocean, it disappeared

march 2014 with 239 people on board, en route from beijing to kuala lumpur. they will meet tomorrow to assess the $135 million search operation. more than 183,000 people in the united kingdom have signed up to vote in the election for the nation's next labor secretary. jeremy corbyn faces a challenge from: smith. battling to keep his job since britain left to the eu. inlots will be mailed august, and the result announced september 24. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. i am mark renton, this is bloomberg. scarlet, back to you. scarlet: breaking news from ebay, adjusted earnings for shares in the second quarter of

$.43, higher than what was anticipated by a penny. -- this is a metric that everyone pays attention to, $20.9 billion for the quarter. ,rowth and merchandise volume $20.9 billion. looking for an average increase of 2.3% year on year. a 6% increase in growth on a mutual basis. see the boost of the euro forecast and see the stock surging after hours. surged $500o, million of its surge, as well. let's get it -- some perspective. the story with ebay here is that it is the less exciting holdover. cory: growth continues there, and there is a trend that we will see in this companies

report. the benefits of currency the last couple of years, they did not pay attention to. but they're pointing out that there is a neutral basis. growth continues at ebay, it is a powerful machine that continues to grow. in terms of qualcomm, we are looking at gains in extended trading right now. the big concern out of everyone, and matt mention this as well, is whether apple drops qualcomm from intel, stops ordering chips from them entirely. chip in apple wins a the new iphone, it may be just a few. giant may not be a big part of the apple business. estimated the number is well below $500 million for apple, so not a big loss for anyone.

imagines in order to get some sockets, intel will really have to cut costs quite a bit. they will not be walking into that with the 40% margins they are boasting of. -- they wantically to build a business, and if that happens, it would be a start, but there may not be a big benefit to intel. alix: we see -- qualcomm rallying today, and many other tech names that are been around forever, starting to get some attention again from investors. cory: after hours trading is not the biggest part of the market, but i think, you've been reporting this on your twitter

feed, most of the market is not fully invested, and a lot of people tend to be big believers here. when you see positive results, it can be seen as a surprise, even when the numbers might be close because there is a lot of doubt about the strength of this market. i am not a big market sentiment weeksut in the last eight there has been a sentiment of bullishness. a 100% increase in bullishness in the market. i think it shows you how much data is in the market. bloomberg's cory johnson helping us break down tech earnings, thank you very much. downgrades turkey, the lira at a record low. ♪

joe: s&p cut turkey's debts, saying it undermined turkey's investment environment, growth, and capital inflows. cowending to -- tyler joins us from washington. your column looked at what we saw in turkey, and what it means for growth. what is the verdict? alix: here is the -- tyler: here is the important point about turkey, freedom is being eroded, they were clamping down on institutions.

was a messenger, to tell the world what was going on there. but i do not think it will have much long-term impact. scarlet: one thing you make a distinction over in your column is whether it is a autocratic coup or democratic coup. turkey's -- turkey a democracy or autocracy? when a democracy is replaced by autocrats, their economic growth declines. if you have a democratic government and the coup fails, over a ten-year horizon, that tends to not have much impact. would stress the point that turkey was already becoming not a democracy. pressok at measures of freedom, turkey was often ranked at the lowest in the entire world, and that is saying something. joe: and, doesn't it say something that the coup failed? for countries with decent gdp

growth and unemployment and not horrible infant mortality, coups typically fail because the populace is not so unhappy that they will support people in tanks in their streets. tyler: and when you look at history, and democratic coups take cusa -- maybe not a perfect performance, but far from bad. that creates rising expectations. but the point is, people are not willing to jettison something that has been giving 4% to 6% growth. joe: i want to switch it up and talk about another column he wrote, linking the last of americans retirement savings to fuelingiety that may be trump supporters. what is your argument there? have been a lot of arguments for what is driving

people to support trump. you talk about the lack of a retirement savings, what connection do you see their? cory: supporters are often -- supporters are often older people. when you look at the economic explanations, they focus on wages segregation and globalization. is a lot offactor people feel they do not have enough saved for retirement. money market funds are low, no one is assured that their equity portfolio will go up by large amounts the way a lot of people expected in the 80's -- 1980's and 1990's. it has created anxiety. americans did once engage in active savings. we had a chart of earlier, in the 1970's, savings was 50%, and in the 1990's, around 8%. >> in 2012 it was around 8%. scarlet: why did we stop putting

money actively aside, did we depend upon the markets too much? tyler: i think in part, we depended too much on markets. when the financial crisis came, it was a wake-up for most people. and many people were not used to giving up the things they like to buy, and we're not seeing wage gains, and we are not cutting spending. it has declined from double digits, and now it ranges from 5% to 6% or lower. when i look around, and admittedly, i am in a limited circle of people on facebook or twitter, i see so many posts concerned with racism and anger, and hatred and are we willing to accept that if we can get some kind of higher savings rate, is that what you're saying? tyler: no, i'm saying there different forces.

racism and bigotry change a people see politics sometimes, but economic anxiety has come to the manner he and often you end up with the worst outcomes when economic anxiety factors, and the cultural, racist anxiety factors from the other direction, pushing you toward different outcomes. and both of those things we see operating today. joe: are there policy levers we could pull that you think would to the balance to cause people to save more and plan ahead for their retirement more? our old tax system has discourage savings for a long time. but the hard thing about retirement policy is that it is very hard to turn it on a dime because it requires people to be making plans over decades. so even if we did the exactly right thing now, you'd be a long time before it had a payoff. so we are a bit stuck. joe: we have to run. tyler cowen, nice to have you on

the show. scarlet: late trading, we speak with a cfo and next. ♪

mark: i am mark crumpton, this is your first word news update, breaking news live from turkey. ane turkish president erdog speaking to parliament and his security team, saying in the wake of last year -- last week's failed coup attempt, he is issuing a three-month state of emergency. again, a three-month state of emergency will be imposed in turkey following the failed coup attempt on friday as you have no doubt heard. thousands of people are either being held in detention, or

asked to resign from their positions both in academia, following this coup. also, u.s. secretary of state john kerry saying the u.s. would not be extraditing a muslim cleric that was living here in the united states that turkish authorities have blamed for inciting the failed coup. secretary kerry saying there is no proof or evidence that the coup was led by mr. gulam. thisll continue to follow story and bring you more developments as soon as we get them. meredith macgyver, a staff writer for the trump is taking responsibility for passages from melania trump's speech which resembled michelle obama's speech. she posted a letter to the website and offered her resignation to mr. trump and his family, but the resignation was

rejected. mr. trump reportedly was interested in making ohio governor john kasich his running mate. times" reports that his son reached out to a kasich advisor to make him the most powerful vice president in history, placing them in charge of foreign policy, but he refused to endorse trump or attend the convention. , mikes running mate pence, will take center stage at the convention tonight. the hispanic chamber of commerce backing hillary clinton as the first ever residential endorsement in the organization's 38 year history. they announced the norsemen today at the republican convention. in other news, german chancellor angela merkel made it clear there would be no talk about from the european union until official notification. she did officer prime minister theresa may space to decide when her government is ready to invoke necessary legal notification.

prime minister may and markel -- today, saying she would not invoke article 50 this year. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries to read i am mark crumpton, this is bloomberg. scarlet, back to you. scarlet: we want to get a recap of today's market action, but a quick recap. the turkish lira heading to a record low in the aftermath of those headlines that turkey's president has declared a state of emergency for three months. it is now broken through the 3.09 level, a record low here. stocks, the s&p and dow climbing to their best levels, the dow rising for a ninth session, the longest winning streak since 2013. clearly some resilience here in

equities following decent earnings. cap intelsome big after the hour, qualcomm on the flipside. it is up over 6% in after-hours, and ebay over 5%, american express also modest. over to you, matt. matt: "what'd you miss?" the largest u.s. automaker is considered undervalued. open,earnings before u.s. let's get under the evidence he what she means in today's, the numbers do not lie. despite record profits last year and higher earnings in the first quarter, gm shares have rivaled ford and the s&p 500 since she took over as the ceo. getting the stock price going is mary borrow -- barra's

biggest challenges. they are expected to fall short of the 2016 record. it would mark the first annual decline in seven years for auto sales. automotive cut its outlook to 17.4 million vehicles, and annual projections for every year were cut through 2023. from trucks toed cars the u.s., and are headed there in europe, as well. americans reference for trucks over cars is more lopsided than ever, and pickups have outsold coupes and sedans for many months. ratio for trucks to total sales outpacing cars by a wide margin. growth in truck sales is key to gm as it titles. they have been the pickup sales leader for nearly four decades.

ford is on pace to keep that title, just barely this year. in response, gm more than inbles its larger trucks july to get americans into the showrooms. but it is not just about the u.s.. operationsnational sold more than the company sold in north america. though the unit level trailed in volume, gm north america did produce $11.1 billion of the automakers $10.8 billion total adjusted earnings before interest and taxes, offsetting losses, although that math would not work in other regions. we will be following these numbers. on thursday, bloomberg will be talking to gm's cfo chuck stephens at 8:00 a.m. new york time. scarlet: we will stick with

earnings, intel predicted third-quarter sales that beat analysts estimates. we will have the latest on emily chang in san francisco. intel joining me now from intel headquarters. stacy, thank you so much for joining us. i would like to start with the pc market. but there are reports out there that the decline in the pc market is slowing. what is your read, based on the results, how is the pc market actually doing? relative to the second quarter, with we came right in line on revenue, and get a little better in profit from our expectations. when you dissect that revenue, the pc market was a little stronger, data center right in line, maybe a hair better, and that was offset a little bit by theness and memory and internet of things. specific to the pc category, we did see less of an inventory

turn, we will continue to because us as we go into the back half of the year. we are expecting a high single-digit decline in the pc market. we hope we are, but that is our expectation. emily: where do you see the bright spots? improvement in the u.s., or a broad? ?- abroad the bigger issue is in the cloud and data center. we have some big cloud customers looking to purchase, we have new products coming in, and new technologies that we think will -- and within the pc segment, we are seeing the same as what we have seen in the last six months. some markets are doing better than emerging markets. there are pockets of strength, u.s. retail was a little stronger this quarter than we

had anticipated in the back-to-school season. we are continuing to watch it. emily: there is concern about the data center business, and that it won't be about to make up for weakness in the pc market. and this is the second quarter that unit has fallen below 10%. will we get back to that mid teens kind of growth we have gotten used to? stacy: we are predicting double-digit growth for this the, that would imply in first half the we of a growth rate that is in the mid teens. i think we have line of sight at that level of growth rate. and there are patterns for some customers, and it is a richer product mix. i think one of the longer-term drivers of the data center is the internet of things that you talked about earlier. all of these devices connecting to the cloud infrastructure is just a data point here, the data

we looked at in 2020, a person will generate a lot of information, and a connected car , almost 3000 times that amount of data in a day. and we have a big driver for the industry looking forward. optimismere is so much about the internet of things, it is hard to put a number on it. i was wondering if you can do for -- do that for us? do you see it contributing to intel's bottom line five years from now? i can be even more near-term the not because we break it down into segments to see results. eight $2l north of billion business for us, on its way to a $3 billion business. last year, it was in the high teens, this year it is expected to be in the teens eight $2 billion business for again. it is growing fast for us, it is a profitable business.

and the driver here is, there is such an explosion of devices, and now we require computational power and connectivity. we are uniquely situated as a leader in both of those categories. emily: bloomberg and others have reported you finally had a big breakthrough when it comes to mobile phone chip parts. what can you tell us about this? is the order coming from apple, and is it for the iphone? we let our customers talk on their own about any design sets that they want to talk about. strategyy, our mobile is that we will leverage the progress we have made in of the 3g world and our plan is that when we get to 5g, we will move from getting -- being a fast follower, to a leader. and when we combine that with the capabilities we have in cpus and graphics and programmable have an incredible

array of products to put together for our customers. i am really excited about where we are, and the strategic invite -- advantage of doing this. emily: have an incredible array of how big of a breakthroh could this be for your mobile business? stacy: not talking specific customer designs. emily: what about mcafee, reports are swirling about its state -- you plan to sell mcafee, or not? stacy: it is our intel security business, and it is doing really well. when you look at it both on a financial basis, it is growing, i think the leadership team there has done a great job of focusing in point security and augmenting that with capabilities to the cloud. i think it has been a really interesting place in the security market, and they have done a great job of increasing profitability. so it is a great business for us. emily: stacy smith, cfo of end up from headquarters, thinking

you so much -- thank you so much for joining us. joe: coming up, we will explore the connection between household debt and global economic growth. ♪

joe: "what'd you miss?" a recent research there he that connect the dots between household debt and slower global growth. here to explain the connection is the author of the study and princeton university professor who joined us from new jersey. thank you very much. you have been doing a lot of work since the crisis, exploring the crisis between household debt and poor economic

performance afterwards. your research finds a global epoch -- application. to us what you have discovered. we knew going into the 2008 crisis, there had been an increase in household debt, followed by the great recession. what we show in this paper is, this feature we have seen more recently is actually prevalent historically in a large sample of vast economies. if you look at historical data, we uncovered this basic fact that rapid increase in household debt is a factor of the gdp, a harbinger of slower growth in many advanced economies. it is not just a phenomena we saw in the 2000. papers after the crisis looked at various counties and regions in the u.s., and quoted performance.

now you are applying it to specific countries. what countries really stand out for huge household debt buildup precrisis, and what they saw afterwards? atif: it is symptomatic of a large cross-section of countries. cover most of the advanced economies, and you see this all oferistic in almost these advanced economies. in some specific instances in scandinavian countries, japan, obviously the euro crisis more recently. but even in some of the emerging economies, you tend to see some of the signs. recently, the increase in household debt in china. mean toid not interrupt, but what is the mechanism between the high household debt and the poor economic performance? why specifically does this cause

of such a problem? we have to appeal to the theoretical work in the literature to understand why we are finding this so strongly. one of the hypothesis -- declinees is there is a caused by this growth and stagnation in that growth in household debt. you think of, if the economy as consisting of borrowers and lenders, borrowers typically tend to have a high margin to consume. at the time they are barbering, they tend to use a higher level of borrowing to spend that tends to increase. but once that cycle ends, you need something else to substitute for the loss in aggregate demand, and that is where typically these economies have a problem. it is not easy for these economies to substitute a demand

that was being created through rising household debt. and that is where the economy slows down. post crisis, so much of get it goingo around the world has been on the monetary side. do your readers have implications -- should we have done more fiscal policies to move that debt to the public sector? speakwe do not directly to the fiscal policy, but there is one interesting fact that we documented in the paper, which is that countries that have more space to do monitor or -- monetary easing -- countries having lower interest rates, they have a negative impact of rapid growth in household debt. that impact is relatively muted. similarly, countries with more flexibility in their exchange

rate, they are relatively more safe because they have more independent monetary policies. they can accommodate these it shocks in a better way than countries running fixed exchanges. for those countries, these kinds of shocks are the harshest. joe: fascinating stuff, loved reading the paper. the professor and co-author of "house of debt," think you for joining us. scarlet: asian stocks on a roll, hong kong shares officially enter a bull market. we will take a look at what is driving that. ♪

scarlet: i am scarlet fu, "what'd you miss?"

hong kong stocks entered a bull market, up from the lows in mid-january. so what is driving the strength? , who has betty liu been following the story. has it been linked to more to china, or the fact that hong kong -- betty: will you be mad if i say all of the above? yesterday,you talking about how china seems to be ironically, an area of growth. i say, some stability in the world. remember about a year ago we were worried about china that had devalued their currency, it seemed like a whole world was going to pot. some of it is china, some of the stocks that are leading the index. the revenues are projected to rebound from the lows, and part of it has to do with the tourist

coming in. also, property prices going back up, and property stocks as well. dollar is taking the u.s. currency, with this idea that the fed is probably on hold with interest rates a little longer. that will be bullish for the property sector in hong kong. joe: last night during the convention i was really bored and did not want to watch the convention, so i was at the bloomberg. betty: see you're watching me in asia? terminalnt into the and made this chart to track random things like indonesian car sales, the dow graining revenue, the share price of caterpillar, and they bottomed in the middle of 2015 and have been rising lately. it feels like there is a big thing where everything associated with asia has been on this really nice run-up since the third quarter of last year. it looks like hong kong property prices are part of that overall trend. betty: i think that is a great chart.

joe, i wish i was you. i would love to be making charts like this. but i think you are right, there is a certain theme here where it seemed like it was overkill about a year ago that things were sold off entirely. and countrywide in that region got sold off. now it seems they are moving back up. but one noted that the chinese stock has been the worst-performing stock market. i think that goes to a very interesting point you have made on this program a number of times. in some sets, the chinese are trying to get their money out of the mainland. when they are moving their money out of the mainland, where will they put it? hong kong stocks is one great place. betty: it is, indeed. and, resorts in miami. joe: betty liu, thank you very much. we will catch you on daybreak asia. scarlet: and you can or his

watch that on the bloomberg. what you need to know for tomorrow's trading day. ♪

joe: do not miss this, u.k. retail sales tomorrow it 4:30 a.m., i know it sounds very early to wake up, but there is good economice of data to come out since the brexit vote. i bought this tie in london because of the discount i got on the pound. scarlet: do not miss this. ecb's rate decision tomorrow, and mario draghi hosting a conference. as iand i will be watching do every thursday, jobless claims.

pickupsts expecting a from extraordinary low of last week. keep an eye on it. scarlet: thank you for watching. matt:

john: with all due respect of house speaker, eventually you are going to speak right? ♪ ♪