scarlet: u.s. stocks closing lower this afternoon and the dow ended the nine-day winning streak. joe: "what'd you miss?" scarlet: we break down a number of them are facing brands. joe: how has globalization helped the economic outlook. matt: general motors hosting record second-quarter results. scarlet: the dow ending the winning streak. treating the record highs. eight out of 10 major groups were down, industrials and energy the laggards. selloff by any

stretch but after several days, these new records have legitimate records. we broke a lot yesterday and intel was one of the companies that really took a hit disappointing investors with the data center, growth, and numbers. it takes a huge chunk out of the standard & poor's 500. southwest also a real disappointment. you can see a big drop there. it is not a big company but it is taking a huge amount of points away from the s&p 500. muskesla motors, elon comes out with his master plan. i can't believe the stock takes such a big hit. what were people expecting? obviously he thinks in bigger terms than that. scarlet: he doesn't give details. joe: he's a big picture guy.

on the government bonds, a bit of declining yields. nothing too dramatic. but the fitting the market hell off. scarlet: the euro dipping below 110 briefly, it is right there again. it was a three-week low. they just have to wait for more data before deciding on what to do next. found a measure of stability. the uk prime minister meeting -- francoiswall on lhollande. missing the idea of helicopter money said to get stronger. it became apparent the comments were old. of yen settling at 105.74 dollar -- a dollar. beenspirit futures have cratering lately, much cheaper than they were at the peak of

2015. thisu are barbecuing summer, the prices are cheaper for you. at&t coming out with results, point72 i share for the second quarter on an adjusted basis consistent with what analyst were looking for. billion,llion -- 40.5 and in this on the top line. you get all the numbers in terms of the u.s. smartphones and scriber base. what you want to pay attention to is the forecast. at&t says it is on track to meet oryx need the forecast. -- or exceed the forecast. coming in lighter than what analyst have been looking for, $343 million.

you can see the stock down. that is narrower than what analyst were looking for. advertising revenue for this second order up 15% to about $265 million. the hours that they put in for to second quarter was up 7% 5.6 6 billion hours. let's bring in cory johnson, the bloomberg media editor at large is in looking over these numbers. cory: it's coming in below estimates, so beating up revenue means the analyst go out. they were a little more optimistic than pandora and were guiding below what the estimates are right now. they are guiding at 365 topline revenues. part of the business, it's very important in view of

the news we get today. , onlycketing business growing 20% this quarter. basedhanged quite a bit on the consequences of everything. summers are summers, springs are springs. much lighter than the previous quarter. the business slowing down and showing me the potential that this has to drive ticket sales. we also have numbers from starbucks and paypal. revenue $2.65t billion, second quarter payment volume was $86.2 billion. a little bit better than what analyst had been looking for. the company raising revenue forecast as well. it will lift the stock i about 6.5%. i will move on the starbucks that reported results, earnings

earlier $.49 a share for the third quarter. that matches the consensus estimate. this is where it gets interesting because comparable --es went up four point excuse me, 4%. is lighter than what analysts were looking for. starbucks is still looking to maintain employer targets. it is not up rating or downgrading any of those views. 4.5%the stock is falling on those sales. america specifically up 4%. u.s., aially in the relatively weaker sales. are hyping their release, their performance in china.

it is highlighted by the strong growth and record revenues and profits in china. 8% year-over-year. pushing those asian results because they probably disappointed globally and in the u.s.. scarlet: coming out the says cents.tter by two if you look at shares of after-hours trading, up by almost 1%. payment of is $1.35 trillion. i'm looking for an estimate number there. was $3.6ting revenue billion. the third quarter payment growth, constant dollar terms of 12%. which-digit numbers there is consistent with what analysts were looking for.

it does look to be better than anticipated. i know you're looking at paypal result. cory: the stock is up as a result. numbers are good. a little mixed, i would day. they added fewer counts than the previous quarter. a lot of large numbers. that is a solid number. on average during the quarter, it is trailing by 12. , it is 28 andpal

really impressive stuff. we know that roger faces accusations of sexual harassment and former anchor gretchen carlson at the network and the company looks into allegations. it is certainly discussing this. there is a quote from murdoch saying we join our

father and recognizing his remarkable contribution to the company and talks about his great contributions. matt: this guy, people credit him for making fox news. you can see there was a big dip. this drop here. joe: and virtually no after-hours reaction at all.

scarlet: according to paul sweeney, a bloomberg estimate, it andates the film studios the fox tv channel overall. it is expected to generate a profit margin. it is an incredible margin. matt: you don't see that kind of margin and a lot of businesses.

scarlet: it has been reported that some of the talent at the --work matt: they said they would leave if roger left. rupert murdoch would be the chairman and acting ceo. they are going to replace it. murdochrs that rupert -- scarlet: it is the cochairman founder. looking at different angles, what are your thoughts?

, it: hiring an outside firm comes at an important time. we get into this kind of red meat of the political season and fox's a strong conservative. for what theyious put on that voice and what they put on the air there. megan fox has been a foil -- , has been a sorry foil of donald trump. her contract is up. they are playing a role deciding what to do about this. perhaps bill o'reilly who was one of his highest-rated shows. it certainly played into this decision about what to do and you they needed to keep in terms of generating revenue.

, bloomberg media reporter coming to us from los angeles. obviously, she joined gretchen carlson saying that it was uncomfortable. >> it is unclear. they will probably stick around.

and how much they will try to bring ox news into a new generation. at the time being, they are going for continuity. joe: the press release said he does -- he resigned, it's different than being hired. >> thoughts as said nothing. scarlet: and this is a company that has the other cochairman.

and this decision. it kind of operated on its own. >> it was about whether they would support -- where they would report. they have been acting in lockstep. the vast majority of it came from rupert because he has a close relationship with roger or he was the primary decision-maker and something we will find out is we do more of ordering on the story.

>> my guess is that rupert will then the next few months sussing out what is the status of fox news. there have been a lot of names floated. fox is really confirmed any that they are looking. in the incredible success, what did they do that made talk so big that gave it a flock news america we are living in now? cablereinvented what a news channel was supposed to be. with fox news, it was built around these personalities that had opinions later night.

and that is something that cnn and msnbc have tried to replicate with someone like rachel maddow or keith olbermann. joe: there are reports that some of the talents might have in their contract that they could leave. is there any other place. >> these are big personalities. >> if bill o'reilly wanted a job somewhere, he could get it. matt: i could see david rose going from cbs to talk news. >> donald trump might want to

launch some sort of news outlet. thought thatous there could be an ideological successor? >> i have no idea about donald trump. is tok everything he does serve the greater glory of donald trump. it seems a little bit are fetched. what happened to the sexual harassment allegations that started all this? she sued him personally, not the company. >> those are ongoing. just because he resigned, it doesn't mean gretchen carlson is going to drop it. she didn't just do it to get back at roger ailes professionally. he has to get back and write his story. that may just toss this to you, cory.

you might be pretty well-informed about this as well. he tried to move his case from new jersey to a judge, a federal court in new york that is somehow more beneficial. what are you hearing on his actual case? cory: [indiscernible] it's about what happens to the money machine. if the guy who ran the news desk there and knows the operations. i would be curious to see who they look to for leadership. rhodes is president obama's chief speechwriter. the importance of that voice was very much roger ailes and fox new it. they paid him $5 million a year.

that, theyback at were doing interviews. the programming was very much it actually what we wanted. this is very much the roger ailes network. may have done so many things about what a normal boss would do. on the other side of the aisle, the liberals were on that. they played a key role

in the investigation, she reportedly also gave evidence. she was harassed in some way by roger ailes. it was the story that turn things up. of course, the entire tv media landscape is challenged by what we are seeing. is it because it has the devoted audience? perhaps a little more insulated. >> they are very much focused on new media. these are guys that truly and deeply understand the way that media is can doomed.

and i don't think of anyone in the world, these guys know they can be consumed. it was a bit of an captive audience. the success, cause for viewers. they don't have the numbers. the audience is so big and they make up for it. generated purely out of the eye of roger ailes. thank you very much for calling in. talk to us about the significance he had on tv news.

why is he such a towering an important figure. >> he went impact and power beyond it. it was a political genius. it was expensive. audience, muche lower cost. it was the genius of ales and fox news. matt: i'm going to bring in brian ways are right now, hang on one second. i'm looking through your note and it is interesting because you say you do not expect meaningful impact, providing a headwind. will not hurt the business

at all but there is a political headwind. now that makes a lot more sense. as i said before, we are living -- we spend all day long talking about what someone said at the republican national convention when there are seriously important things going on and all because of fox news, isn't it? >> they have an agenda and they have a good show, in that sense. if fox feels that is the .ight business model

scarlet: if you consider fox news channels positioning in ,his together political cycle it has certainly evil because they were getting pushback. they were putting up full screens, that is industry lingo. fact checking messages that pushback against the stated positions. >> i'm arguing that the fox news set the tone of what this course and that opened the door. had next feelings about that. rockland and his brother have long been aiming for ales and did not get rid of him.

-- and wanted to get rid of him. will they make it more ?espectable or will they double down? pulpit.s bully i want to see what influence they will have on the channel going forward. matter who wins the election for fox news profitability? >> i don't think so. matt: good answer. scarlet: thank you so much. thank you for joining us. cory johnson in san francisco as well. and we have a lot of earnings. this is bloomberg. ♪

mark: as we have been reporting, the paris prosecutor said the man behind the wheel the truck that killed 84 people last week had accomplices. he stated he had been planning the attack for months. preliminary facing charges for their alleged roles. there were indications he had been studying an attack since 2015. asy'll jump celebrated national holiday today under tighter security following the deadly attack in nice. introducing her

father tonight before he formally accepts the republican presidential nomination. she will try to persuade female voters according to polls who have been reluctant to support him. hillary clinton is expected to announce her choice for running mate and former president ill clinton republic lee hit -- reportedly has made up his mind. believeson reportedly tim kaine's background will appeal to voters and prepares him to be president. dayal news 24 hours a powered by more than 2600 journalists and analysts and more than 120 countries. i'm mark crumpton, this is bloomberg. we want to recap the earnings right now from earlier in the hour. the burrito chain still reeling

from e. coli and other things that drove customers away. the stock is moving somewhat higher in after-hours trading. let's move on to starbucks as well. expectationsling there. joe: another company moving lower, pandora. a narrower loss that expected but $343 million revenue in the order was shy and was estimates. and of course paypal is doing well in the after-hours right now. in line withn bang earnings of $.36, but boosted its third quarter and full-year revenue and earnings forecast. or the full year, paypal now

10 $.85 billion in revenue. the estimate was only for 10.7, so better than analysts had been looking for an better than previous estimates. the estimate is $.35, so that is a range that includes numbers below the estimates, but still you can see a jump as high as 6% in afternoon hours. scarlet: i wanted to correct something i said yesterday about ebay. the earnings-per-share figure from a year ago, now that paypal has been split off from ebay, earnings from continuing operations for ebay was $.43 a share, a penny more than in the same quarter a year ago. they climb to a record high, the company raising revenue for the full year.

joe: earnings relating news from boeing. a $2.1 billion after-tax -- after-tax accounting laws. dreamlinerhe 787 reduction, 747 jumbo jet and the refueling tanker contract for the u.s. air force. a $2.1 billion charge to boeings and as a result, is down 1.5% in the after-hours. after determining it cannot find any buyers it wrote off the aircraft. there were so many problems bringing it to market, and now they had this issue. we can pull together our collective savings and just pick

up one of those aircraft. that would be cool. we've got to move on from earnings because one of the is that the rich of gotten richer. depicted inlass is this famous chart that many have deemed the elephant chart. the conversation may change because the chart does show how throughouts slower distribution income. us why this is a significant change. if you take china out of the occasion that the curve really looks different. >> what it means is very simple. another graph is very simple. , overallveloping world

they had to terrible decades in the last two decades of the 20th century. this is 1988-2008, if you take , i would call it neoliberal globalization. it was a whole set of policies that were dropped it in dozens of countries. the onely, china is that did not adopt most of them. they had a different development strategy. the state was responsible for most of the investment before the banking system control direct investment. they had technology, all the when reforms went in the

opposite direction. here's a country that did most things differently from what the rest of the world was doing in this whole era of globalization. this is the one that grew its income per capita by 13 times in 30 years. joe: i want to talk about why this is so important. there is a lot of anxiety about free trade in the u.s. and the u.k.. the story we are told by many modeltes of the current is that yes, perhaps it hasn't been ideal for the middle classes in the u.s. and europe, but it's been such a boon that ultimately we have to keep pursuing this and perhaps do more domestic distribution. >> your argument is essentially saying it hasn't been that great for the world, and era of globalization and free trade, and the one standout story where

people got much richer over the last several years, they did not follow the neoliberal script at all. now it is the biggest economy in the world, bigger than the united states on a parity basis. in the 2009 recession, that would have been much worse if it were not for china. china was hit very hard by it. lost 3.4% of gdp they still and yet grew 9% that year while most of the world didn't grow. because they had so much state control over the economy, they just shifted investment into the domestic economy. pulling that, they helped

a lot of countries up from where they would have been without china and that's for the whole first decade of the 21st century where we saw a considerable rebound in developing countries and a lot of that was due to china's rapidly growth. scarlet: you have urban china and rural china, and even as the income gap widens across the developed world, it also widened within china as well. the rich got richer there and plenty of people were left behind as well. how do you back up that idea that ruben -- rural and urban china expanded at different paces? >> i would not say they got left behind. hundreds of millions were pulled out of poverty.

in terms of the whole world, their growth was so rapid, per capita income multiplying 13 iod.s over a 30 year per even with the vast increase in it still pulled hundreds of millions of people out of poverty. ask that we to bring the elephant chart back up , with or without china. in both charts, the upper middle-class seemed to grow the least. why is that? what is it about the upper-middle-class that reduces the possibility of growth, once you get to that 75th percentile? actually negative.

that is mostly the bottom half andhe income distribution they got hit really hard for the obvious reasons. you throw the majority of workers into competition with workers making a fraction of their wages and you design treaties and rules that do that but not for the doctors and lawyers and engineers and so , you are going to see a big redistribution of income. that was not the only part of it, but that was a significant part. part of international the policies that worsened income distribution in the united states and the higher income countries. you are seeing a whole set of

ideas that need to be re-examined finally being re-examined. cory: it gives you a tiny sliver of hope that people know something the global elite do not. really fascinating stuff. can america learn from latin american countries? this is bloomberg. ♪

>> roger ailes had been accused of sexual harassment by

gretchen carlson. he will but succeeded by rupert murdoch. chipotle is still reeling from the food safety crisis that heard its reputation. second-quarter profits and sales missed analyst estimates. earnings per share was $.87, shy of analyst estimates. shares are trading lower in after-hours trade. shares of pandora falling in the after-hours. estimates asd active listeners declined. the company cut its forecast for 2016. the ceo wants to quadruple sales by 2020. starbucks says third-quarter revenue failed after possible sales growth slowed in the americas. the world's biggest coffee shop chain said cells are up to $5.2 billion. deceleratedales

from a 7% increase the prior quarter. that is the bloomberg business flash. "what'd you miss?" there is another part of the globe that faced brides in the opposite direction, and that is latin america. from a professor at the school of public policy. thanks for joining us. website, thing of only --cinating chart that shows do you believe hard work can get you ahead? in the u.s. there is a strong upward curve where the poor do not believe that hard work will work. it is much flatter in latin america. explained the significance of the chart and your findings overall. >> it is very significant. when i first found it i wondered

if it was a data coding problem. way, it reflects what is going on. is poor anda getting out of poverty, remarkably inequality has gone the at a time that we know u.s. not only has inequality of income distribution gone way up but inequality of opportunity has also gone up. of peoplee story coming out of poverty, a new middle class, and believes about hard work getting your head equally shared across the poor and rich in latin america. in the u.s. you have a very large division inexperience and believes that you're seeing in our political debate. what policies have worked in latin america to improve growth and outcomes and reduce

inequality? >> first of all, it's important to distinguish the average in latin america. the average high-performing peru,ies, chile, brazil, several others, and the outliers like venezuela, ecuador, and bolivia who have taken an alternative path. but latin americans basically embraced the free market, globalization, democracy model, and democracy has been a very important part of that in terms inclusive and politically aware societies. the second part of that has been where i think the u.s. has really forgotten angel policies that made a big difference in terms of making our own society inclusive. that had to do with progressive fiscal policy, social welfare transfers instead of treating them as losers or stigmatizing them.

explain to us what happens in a society where more and more people feel stigmatized and feel like losers and where the government does not take any active role to bring people into the economy. >> i think you are seeing the outcome. the pockets of desperation here which are playing out in increases in mortality rates among uneducated, middle-aged poisoning ande, other preventable death, their concentrated in areas where the middle class has hollowed out. they are isolated locational he from each other, they have to drive, there is no vibrant city center. if you look at cities, they are a different story. there are more alternatives, they are more diverse.

there are big differences across racial cohorts. they are isolated and feeling desperate versus what is remarkable, is the amount of optimism among traditionally discriminated against and marginalized cohort. they are significantly more optimistic about their future and in particularly, poor blacks. joe: i encourage everyone to check out the article. thank you very much for joining us. next, we willg up discuss the resignation of roger ailes. said they make up to 25% of profit. he will join us next. ♪

news,t: back to breaking roger ailes resigning from fox news. he will be succeeded by rupert murdoch. paul, it is hard to overstate how important fox news is in terms of profit contribution. really the most consistent profit generator at 21st century fox. , well margins over 60% above cnn or any other cable network system out there. clearly was the major driving force. he set the editorial tone and set the tone for talent that came on the air, attracting, keeping, and grooming talent. you think about cnn which

has been on the air for 40 years, had been number one and they lost that position to fox, it's just an amazing story. the question now is, can they keep it up? once it became clear he , should investors pay more attention to this? as we've talked to investors over the near to immediate term, people don't feel there's much risk to the cash flows coming out of the fox channel. they are such the dominant leader over the number two player, cnn. but long-term there are questions that will the tone of the fox business channel and news channel change? will they change tack and beer away from their editorial position that has made them so successful over the last 20 years? then will they lose their edge in the marketplace? the smart thing is to put rupert

in as the head of fox. it is the differentiator. you have the mainstream news outlet clearly to the left and fox's way over to the right. ,f they joined everybody else does that leave a hole for donald trump to start his own? >> a lot of investors told me ofs clearly is an example rupert murdoch sons exerting their influence over their father and really pushing for this change. do the sons share the same editorial outlook that rupert does? if not, there could be a shift in the fox news channel going forward. that could have a negative impact on profit going forward. trump remember donald took on fox news in a way that caught people by surprise but they have sort of reconciled.

there grip is not as unassailable as it used to be? to reachy he was able his audience through twitter primarily ended not necessarily rely on as much as the other republican candidates have over the last several elections. is this something new? i think most people think trump is one in a million and fox's still the player for the republican party, for the right. scarlet: thank you so much for that quick analysis. we will be right back. ♪

general electric reports

earnings tomorrow at 7:00 eastern time. that does it for what did you miss? e

tok: with all due respect the privacy of convention goers, you always have to look out for the kiss cam. ♪ mark: such a