oliver.iver rent ♪ janet yellen's shares her view on where policy is headed. we have the charts you can't miss. does it just need to grow up? sliver: rapid demographic around the world, we will find out what it has to say. scarlet: u.s. stocks drifting lower. it was a modest move. a stat that tells you what happened. is in its 30th day without a one percent of move in

either direction on. that is a one-week, thank you. a very quiet week. those could be one day moves. this is very little happening in the market. green.daq turning stocks with the second weekly loss since june. some of the things we have been talking about continue. basis point move and semiconductors, led by a applied materials and micron.

utilities and telecom stocks, the only real group moving here, and they are moving downward. stock bubblevalue is starting to let some air and out. one of the big sectors that lost were yield sensitive areas. here is a one-month chart of the u.s. 10 year yield. u.s. 10 year yields closing out today at the highest level since august. thelet: i am focusing on pound share. -pound. yuan

there is a deadline to keep in mind. germany and france are preparing for elections. also, oil, a one-month chart of oil, early august, bear market, ticking higher today. august, back for in a bull market, so unimpressive recovery. scarlet: a bull market within the bear market. joe: that's right. let's take a deep dive into the bloomberg. i'm looking at one of the stories we're looking at, viacom. the ceo fell victim to sherry

redstone and her father. they are now laying the groundwork for viacom, the blue , and cbs, the white line, to reunite. the valuation gap is closing. the spread narrowed as much as 57% since march. it will be interesting to see how this happens and what shapes up next because there has been so much drama there. joe: so much drama. i am looking at emerging markets stocks. this is a 10 year look at the emerging market etf. the question is are we at a bottom.

is it a durable turnaround or not? some of these other lines are the 20 week and 50 week moving averages. to breaking above the 50 week moving average. it hasn't happened yet. there have been a few times when it tried to break out on the range, so tried to keep, on that, maybe that is they sign of a durable bounceback. bounds isd on the way -down. i'm looking at volume.

ix groups and new exchange started trading. you are seeing the trend where there is more and more volume happening off exchanges. the market structure for trading has changed so much, becoming more dynamic. the red line is off exchange, 39%. this is a rolling 30 day average. more tradesmore and happening off your main exchanges. it will be interesting to see otherat space evolves and trading platforms come to market. week, the huge

jackson hole event. hear from brilliant minds in the world of monetary policy. what are you looking at these days? everyone wants to hear when the next rate hike will be. does say, people will take clues from. the other big thing is the topic , designingerence resilient policy frameworks for the future. bigger existential issues about the future of central banking. situationa permanent where they will be using balance sheets and that sort of thing going forward. let's get the short-term chatter out of the way. shows thechart that probability of a september rate increase. that is the white line.

we are looking at 14%. for december, 30% right now. what is the likelihood that janet yellen does not give us any indication? >> i think that is fairly likely. it depends. , shee really wants to hike was an signals. otherwise, she want. given where markets are and the get, does not seem like they are in a big hurry. oliver: i think the story of the week was inflation. any chance they will be discussing where and how to target inflation? what he wrote about

inflation targeting and raising the inflation target gets to the heart of this topic at jackson hole, which is we need to think about things other than what we have been doing and what we are doing. the ideas he put forward, potentially raising the inflation target, move the nominal gdp targeting, we may not get much on that stuff, but that is the background for what they are going to be discussing. the i have a chart on bloomberg. what is going on here? matt: this is related to longform and short-term issues. r is rising more than one month. the white line is the component is aboutncrease that

fed expectations. that has not really moved much. thanks are having a harder time finding dollar funding because and otherory reform sources of dollar funding are drying up, like petrodollars. this global environment is not conducive for banks getting kind of the that is purpose of a rate hike, so maybe that precludes the need for one. not going to try and comment on this, but i want to tell you why we are looking at this, price expectations by gender. matt: these are inflation expectations, important to the fed. this is what keeps them up at night. for women, inflation expectations are at a record low. for men, they are just shy of a

, but you can see how tenuous the situation is. they have plunged over the last few months, and that is an interesting way to look at it. think i ever realized before that they were broken down by that way, age, gender, education, and pretty much across the board they are record lows.ar this is why the fed is being very careful right now. theyis not something where want to get into hiking rates and have that go further. that's one of the things people point to when they say the u.s. economy is not a strong at some of the data suggest. if you look at gdp since the end of 2000 seven, the u.s. grew faster than the rest of the developed markets, but the u.s. population grew faster, so it goes the economy should grow faster.

what matters is looking at per capita gdp. the u.s. is not that much further ahead. instance, which is not on this chart is growing faster than the u.s.. the u.s. is blue and that european countries are purple. matt: it highlights how the central banks are dealing with the same issue now being so close to zero and having to come up with new ways to potentially stimulate, and those inflation expectations are the most dovish chart out there that you can find. that is weighing on their minds right now. everyone close to zero, inflation expectations falling, that's not a situation where you want to get ahead of yourself and raise rates. joe: should be a fascinating week next week. matt boesler, thank you very much. scarlet: one year since chipotle

has been hit, shares have yet to recover, down 50%. bet on its other ventures to turn things around? this is bloomberg. ♪

obama heading to flood ravaged louisiana. donald trump and mike pence to ured the damage today. clinton spoke with the state's governor. 13 people have died from those floods. has stepped down,

coming after the campaign announced a major shakeup wednesday, the second leadership reshuffle in two months. become scrutinized because of his russian connection to the former president of ukraine. terrorth toll from the attack in nice is now 86. the latest victim had been at hospital and died from injuries sustained during that july massacre. is the second hospitalize person to die since the attack. dozens more were wounded when a tunisian drove a truck into a crowd, the islamic state taking responsibility. million dollar cash payment to iran was contingent on the release of a group of american prisoners. it is being slammed by gop lawmakers today. it was the first time the u.s. had definitively linked the two events.

paul ryan accuse the president of misleading the public. donald trump said mr. obama openly and blatantly lied about that exchange. a start lost his job as president and chancellor -- kenneth starr lost his job as as heent and chancellor resigns as baylor law professor. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. scarlet: "what'd you miss?" chipotle may need to grow up. the stock has seen highs and lows. since the bacteria outbreak, three straight quarters of double-digit sales the kleins, so is it time for chipotle to

rebrand its business? chipotle is not just about its namesake restaurant. franchises as well. part, 99.2% of revenue comes from chipotle. 13 shop houses and three pizzeria locales. they have had these concepts for a while. before the crisis, they did not ever say much about them. they have been out there, but .nly getting attention now plus, the news that they will open a burger concept, which has been met with confusion.

these guys have big problems in their core business, shouldn't they fix the core business? where are these other restaurants? they have done a couple in kansas, maryland, washington, , but geographic clusters they don't move the needle. away drawing attention from what they should be focused on, which is fixing their core business, which is troubled. joe: we show the stock chart earlier. it has not recovered at all from when it started collapsing after the bacteria stuff. is there any sign of a fundamental business turnaround? >> no, not yet.

the question is when this will happen. when it first hit, people said it could be 2017 before this starts to turn around. big hit to their brand, huge headline risks, the numbers have been bad, three straight quarters of declining sales. i don't remember any headlines recently. >> the last person who got sick was in december. there was a scare in march, but they followed protocols and no customers got sick. right now it is just a tarnished brand. oliver: shares are down 49% right now. we've talking about this restaurant recession, how much of this -- obviously they have these specific problems, but is there any chance that it is getting wrapped up, macro trend,

with restaurants. were talking about 23% declines in same-store sales. scarlet: do you think chipotle is right for an activist investor? >> we keep hearing about that. the big trend in restaurants is franchiseesng, make take the cost. sell them back and take the burger king model. insular and there has been criticism of no diversity on the board.

the founders are still heavily involved. thank you very much. scarlet: coming up, audience is participation, please. this is bloomberg. ♪

scarlet: i am scarlet fu. "what'd you miss?" my chart is on what ails the economy. we have a lot of that and a huge trade deficit. -- we have a lot of debt and a huge trade deficit. it seems like there are different ways to interpret it.

it is interesting to see the way of essentially these different sectors of the economy trade, government spending, private assets. scarlet: the back drop is the u.s. losses and trade and jobs. the pushback from other economists will say that cumulative trade and trade debt figures don't tell the whole story. it doesn't account for services -- you have thriving economies that persistently run trade deficits, even during boom times.

oliver: while the two are mirror images, it looks like the isstanding treasuries moving. joe: i have a chart that was sent to me. is em risk.ne you can see it bounced in january and has been rallying back nicely. the blue line is the markets one year expect tatian of a rate hike. fed is paying more and more attention to international conditions. it makes sense perhaps that the markets rate hike expectations

would be tied to the fortunes of emerging markets. his argument as that the market is too complacent about what the fed might do in light of this global rebound. scarlet: that blue line needs to come up a little bit. oliver: talking about emerging markets and volatility, i'm looking at volatility again. the vix has been low, but this is interesting. there is subdued volatility and the currency markets. small pickup in the japanese yen volatility, but markets remain complacent. we've seen volatility spikes lately, but for now, not there. rapidt: we will discuss a

demographic shift in global terrorism and what it tells us about the economy. this is bloomberg. ♪ [ clock ticking ]

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♪ brand new apps, shows to go, ♪ ♪ awesome internet that's super whoa... ♪ ♪ everything is awesome xfinity. the future of awesome. word let's get to first news. president obama will visit louisiana on tuesday. he has been receiving updates. people have died from the floods, 40,000 buildings damaged. trump and mike pence have been surveying the damage in louisiana. they visited with vick them so the floods. -- with the victims of the floods. hillary clinton says she spoke to john bel edwards by phone.

she says the relief effort cannot afford any distractions. she said the best way to help us to make sure that the people of louisiana have the resources they need. ,ore than 200 buildings including 100 single-family homes, were destroyed and wildfires 60 miles east of los angeles. ,irefighters are making headway the far now 26% contained. 82,000lames forced residents from their homes. theirnt women and partners should consider postponing travel to all of miami-dade county. identified arities second zone of local zika transmission, including south beach. state now has two areas considered active for potential zika exposure. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg.

. am ramy inocencio scarlet: thank you. let's get a recap of today's market action, not a lot of action to speak of, stocks falling for the first time in three days, no economic data that move the markets,, so everyone is looking ahead to the jackson hole meeting next week. very little ripples in the market, whether it is fixed income, forex, equities, all very quiet. oliver: it makes you wonder whether or not people are prepared for any kind of disruption. we chronicled a lot of things where people have gotten into the market, so we will see. joe: it's almost too quiet. oliver: maybe. joe: "what'd you miss?" the worlde changes in economy by observing how people travel. there is a shift it may have a

positive outcome for the travel industry. thank you very much. what are youch, seeing in the world and what should people who don't a attention to travel industry trends closely be watching? >> the summer is going badly for the sector because of fears, isis, terrorism, zika, immigration, elections in the u.s., and general uncertainty. there have been some issues in issues, airlines, i.t. southwest had an issue last week, delta as well, so a bunch of things are affecting the industry at this point. is thek that travel bellwether sector. it is the one that sneezes first when anything happens in the world economy, so an interesting sector to look at. scarlet: i wanted to get a

comment i brought from the ceo of kayak, to the extent that americans might be taking advantage of the stronger dollar. most americans don't think in terms of exchange rates. it takes time to build, but that interest will be there. scarlet: maybe by next summer. is that enough to overcome the fears that abound now? >> probably not. it depends on what kind of distractions happen. is taking out a huge amount of capacity in the cruise industry. , the answer depends on the type of disruption. ofver: i wonder if some these events have kept people at home instead of traveling.

i wonder if it is also where they are happening. you're talking about events in before traveling to miami, all these places you don't typically associate with fears about travel. at oure things are doorsteps in a lot of ways. some of the economies are benefiting. the capacity that has been taken , tunisia, egypt, they're going to spain and portugal. joe: what about looking at it from the perspective of the emerging consumer around the world? u.s. consumers are less inclined to go to europe or south america, but there has been a huge boom outbound from china. what else are we seeing in terms of countries where there is a big boom? changing, economy is

but brazil this year has been pretty bad for brazilian outbound. india is growing well. if you look at southeast asia, it is one of the most fascinating areas in the world of travel because the sheer amount of people that live in the effect ofd low-cost airlines in that region of the world. we think southeast asia is the best place to watch. i was commenting to someone before the recent bomb attacks in thailand that it seems like the safest place in the world to visit now. always seems on edge because it has been a target and the summer has been awful for europe. is that a misconception? >> i think southeast asia is safe. thailand from a tourism perspective, they have things under control for the most part. that hotelss become

and airports get hit as high profile targets. we have talked off-line about what a great country malaysia is and how more people should travel there. are you bullish on these countries? >> i think they have done a good job with their infrastructure. is can airlines direct routes from some of the north american and european -- a verye crash is airlines, a terrible string of them, was there an impact on travel data after those? hugelaysia had a contingent of chinese inbound, and that was affected big time. oliver: as people rethink traveling, i suspect there is a reaction by hotels and airlines

to induce people. is now a good time to travel when you gauge expenses? >> july and august, the number of bookings were 20% up as a result of a weaker pound, so it is a good time to travel, especially in europe, outside some of the flashpoints, if you will. france is still a safe place in general compared to other parts of the world. prices are cheap, hotels are cheap. the good part is there is a big battle between the online travel booking sites like kayak, expedia, and the hotels, which means that one is trying to fight the other and prices are lower. oliver: prices are lower as a result of the competition. back to i want to go that chart with chinese tourists spending and how off the charts it is. have noticed is that

whenever there is a golden week in china, certain cities and resorts are overrun by chinese tourist. thousandsundreds of of people descending on one little city that may not be equipped to deal with that kind of volume. >> the volume out of china is off the charts. even india. is there any change in where they are going? ,ave we seen any trends europe, north america? >> they used to be the cliché of andchinese tourist in buses going to specific parts of the world. i think that is changing, especially younger chinese. they are going be on the hubs, beyond new york city, for example, they will end up in philly. scarlet: you see lots of small groups traveling.

for think that is good news smaller joe: cities as well. thank you for joining us. scarlet: donald trump's campaign chairman resigned, capping a week of dramatic changes for the republican presidential nominee. this is bloomberg. ♪

scarlet: i am scarlet fu. it is time for the bloomberg business flash. bridgewater associates paring losses with a gain of almost 3%. declines forim

pure alpha two to 9%. the fund had lost close to 12%. morganawsuit accuses stanley of forcing hyphae investment funds. said theparticipant company treated it's a billion-dollar plan to promote its own mutual fund business. it is also accused of charging higher fund fees to its own workers than outside investors. ceo fishman of travelers at with als and has died today. that is your bloomberg business flash. oliver: "what'd you miss?" paul manafort has resigned as donald trump's campaign

chairman. pro-russian governments sigourney route payments. for a look at the next steps for team trump, let's head to washington. welcome. a big of a mess as it looks like? >> you don't want someone to be running a campaign that is essentially a foreign agent or has been a foreign agent for people sympathetic to russia. where he washing supposed to register as a foreign agent and didn't. this is something that has dominated the conversation in washington for several days. that is not the reboot that donald trump was looking for. comes onresignation the heels of the trump campaign having brought in some new blood at the very top that some

interpreted to be at the motion for paul manafort. how much of this resignation is the to the fact that writing was on the wall and he was no longer in charge? how was the bringing end of the new blood and acknowledgment of bad news to paul manafort, ukraine ties, what was the cause and event here? i'm certain it was the news coming out about ukraine that would be the cause for this resignation. easier that het became less important for the campaign at this point. he was already being deemphasized even though he was in a circle among the top four people in the campaign still. when you are having the conversation about the top eight being a foreign agent for people sympathetic to vladimir putin, it is not a hard decision to

accept his resignation. scarlet: speaking of an inner circle, it is notable that ivanka trump and her husband were on vacation around the time these changes took place. is there anything to read into that? >> i don't think i would read much into it because this is not a hard political decision. again, it is very embarrassing and you have already made a decision that you are going to go in a different direction and you're just keeping him around for some continuity. it is not a hard decision to make. in ar: i want to bring soundbite from a donald trump's speech, where he did something that he does not typically do, which was some kind of apology. >> sometimes in the heat of debate and speaking on a multitude of issues, you don't choose the right words or you say the wrong thing, i have done

that, and believe it or not, i regret it. what kind of apology is this? is this what my mother called crocodile tears? showss is something that he is doing what a lot of politicians do. you can't necessarily get everything back i making an apology, but it helps some, and you have to make apology nottimes even if you do fully regret it in politics, and this is an example where trump the presidential candidate is doing something they do in the big leagues in politics, which when you offend voters, you make an apology, even if it will not win them all back and even if you do not entirely regret what you said. the hillaryre is clinton campaign, their own controversies around ties to foreign entities. we found the clinton foundation

will no longer accept money from foreign governments. will the donald trump campaign be successful or able to make some hay with clinton's own connections to foreign entities now the paul manafort is out of the way? >> absolutely. to make some able hay, even with paul manafort, but it helps that he is out. there are foreign entities who have donated to the clinton initiative that have been involved in the clinton foundation. it is not unknown in politics for the pot to call the kettle black, and it wasn't as if donald trump was directly involved in paul manafort's activities. now they have jettisoned him. i imagine we will continue to even ifut this, in hillary clinton were to be elected, you would see criticism likely from some donors. going tore are donors

a foundation tied to someone, that leaves you vulnerable to criticism. joe: thank you very much. coming up, the status of starling, will it ever be a safe haven in a post-brexit world? this is bloomberg. ♪

scarlet: i am scarlet fu. "what'd you miss?" safe haveng deserved status? sterling deserved safe

haven status? i think scandinavian currencies are aaa, but no one wants them anymore. sterling provides liquidity. we are in a cash driven environment and sterling will provide it. we don't have the euro structural issues to worry about. to pick up on something you guys have been , sovereign wealth funds and private investors will be happy to finance the current account deficit. that is not a consensus view in london right now. >> you want to finance a current account deficit for what reason? access to the european union, you don't want to be in the u.k. funds areeign wealth

not here for access to the eu. secondly, the price issue. sterling has already adjusted. relative to emerging-market currencies, it has not fallen as aggressively against the dollar. thirdly, balance of payments, financing, by virtue of correction in the currency, and yields in the u.k. falling, i think the income balance can stabilize and turn around, so why worry? a situationface where boe stimulus become sterling positive? >> absolutely. if you cboe stimulus ,omplemented by a fiscal reset if growth begins to surprise to ,he upside next year and beyond then that could be conducive to the currency and other u.k.

assets as well. we often talk about how footsie is a beneficiary of weaker sterling. that correlation is not constant. u.k. under position, growth to the upside, then flows in this direction. seen more foreign capital coming in as sterling prizes, does that decrease the pressure on the government or boe? for the boe, they will be more careful. inflation will spike in the coming quarter. strongcurrency remains over the next few quarters, then inflation begins to understand the oe assumptions, then there may be a problem compared to others. you need to know

to gear up for next week. that is coming up. this is bloomberg. ♪

new home sales come out tuesday. economist are looking for a slight decline from the 592,002 577,000 analyzed.

there is a lot of noise in these numbers. importance of housing and believe there is still a big uptrend here, you might want to pay attention. important because this is what creates jobs, new homes. what peopleknow will read far too much into? every word that comes out of janet yellen next week. she will be an jackson hole on friday. onrybody will be listening whether she comments on rates or the global economy, adding anything to the fed minutes. china's industrial profits coming out on friday as well. time, june, increase of 5.1%. i have a chart looking at chinese industrial profits versus the chinese currency. you have the dollar rising and

andme versus the yuan industrial profits coming off their lows. that does it for "what'd you miss?"

margaret: i margaret talev it. joshua: and i'm josh green. with all respect to paul manafort, we hardly knew you. >> ♪ joshua: tgif. mark and john are off this summer friday, so margaret and i am here in washington d c, to do the show. august is a boring month for presidential campaigns. it does not always -- >> paul manafort, the trump campaign chairman come out. joshua: or maybe not. trump's