we are moments away from the closing bell. it is a sea of green. it this is bloomberg. ♪ >> i am scarlet fu. joe: i am joe weisenthal. "what'd you miss?" i am matt miller. stocks and bonds rally in unison. we break down the moves by asset class. at blackrock's leaders circle event. robot.ear the providing new opportunities for workers according to goldman sachs. we will speak to one of the co-authors. ♪ we begin with market

minutes. stocks, markets given the go-ahead because the fed has left rates unchanged. people are looking at this as cheap money. joe: the long-term trajectory has not gone up at all. everything was flying today, except the dollar. matt: before i get to the u.s., take a look at europe. the same story there, green across the board. you can see every group rose. in the s&p and you can look at what is going on in new york, everything gaining. the big ones, apple with a continuation of a fascinating story, will it or will it not by maclaren?

we took the story further today. apple shares are up 1%. yahoo! shares and still maintaining a slight day and after confirming that 500 million customers had data stolen. amazon hitting a new high. that stock inching closer to become only the second four-digit price to stock on the s&p. priceline.com is the only stock on the s&p above $1000. joe: a quick look at yields in the u.s. at theon of movement short end, but the 10 year yield continues to decline. the long-term expectations did not rise in any meaningful sense , so we have seen this rally and

long-term government arms. when people buy everything, yields go down. scarlet: the dollar decline. it extended yesterday slide because of the hawkish whole decision. wayyen weakness is the best to illustrate the risk on an currencies. a lot of green there. -- korean won with the biggest gain. the only exceptions are the brazilian dollar -- new zealand dollar and the brazilian real. makers andk policy new zealand left rates unchanged at 2%, but did signal further easing. the norwegian krone surged 1%. what changed here is that it hinted at moving away from an

easing bias. even the mexican peso was up against the dollar. commodities, everything was up. iron ore rallying lately, optimism about china. crude up. gold up. could look at weed, coffee, pretty much anything else, it is all green across the commodity complex today. scarlet: let's take a deep dive into the bloomberg. joe mentioned the mexican peso. it is having a moment as a proxy for emerging markets and donald trumps candidacy. the blue line you are looking at is that pesos drop versus the dollar. it is inverted. when the line goes down, the peso is depreciating versus the dollar.

the purple line is the other 399 riches billionaires tracked by bloomberg. publicly traded electronics retailer tumbled. also, the rally and his other company has been running out of steam. i thought it was fascinating because on the bloomberg wasionaires index, salinas the biggest loser and latin america. joe: the peso slide causing a lot of pain. i want to revisit a chart i looked at a couple of weeks ago. it is still interesting. amazon versus the price of silver. it demonstrates how everything is correlated. two weeks ago, i thought it was but it haseresting,

continued 23 straight days when they have moved together. 16, theyseptember quickly moved apart, but he race that cap. they are up again today. i like anything that demonstrates how everything moves together, and i have been obsessed by this chart. i have a theory, but it is too long for tv. everything is moving together, and when you have a precious metal and a tech stock and they move like this, maybe you should pay attention to the correlations in the market. joe: both are cyclical, right? cyclical, driven by the fed, optimism, and the forces that push money into one seemed to operate at the same case as the forces that push money into the other. at some point, we will devote a block to it. i have the participation rate. i thought it would be

interesting to look at. from the low in september, we have risen back to 62.8 from 62.4. i threw in what i believe is some kind of fibonacci sequence. it is meaningless. janet yellen and the fed are starting to gain some traction here and were getting people coming back into the labor force holdch if you can an unemployment down, it's a good thing. joe: it still makes a good point. scarlet: much more coming up. black rocks chief global investment officer will join us live.

this is bloomberg. ♪

scarlet: i am scarlet fu. "what'd you miss?" we will not let you miss black rock's event in manhattan. good afternoon. of call iteen a lot thursday morning quarterbacking after yesterday's fed decision, but what you have to say is different and important for people to hear. let's start with the certainty about the december hike.

the market says 60%. it sounds like you are 95% or 100%. there.s up she was clear we are there except we want to see more evidence. dissents onthree , and quite frankly i think they have laid out a path where they will try to get one done this year, a couple next , and not getting the one done would be against to their desires at this point. >> is it not potentially a little bit dangerous to have a camp that is forming around members as far as future policy is concerned? inflection reach points on policy, it is part of the evolution. you see something similar in

japan, a debate about how to execute policy from here. it was interesting when janet yellen said we agree on more things than markets give credit to. chair will be an influential voice and they will come to agreement. i think yesterday was a bit of a compromise. we will see more evidence, then get moving. >> is the other thing i want everyone else to hear. you believe the fed has already made the decision per se john williams to run inflation hotter, perhaps considerably hotter, than the 2% target. >> i think that is right. first of all, you don't know what full employment is until you test it there it i think -- i is a willingness think they are comfortable and the fed has a multitude of tools at their disposal to keep down inflation. >> like what for example?

interest on excess reserves, sell assets, raise interest rates. you certainly can move interest rates. by the way, talking about it, it's something the fed uses -- quite a bit. this perspective from what specifically the janet yellen said yesterday? has room to run. there is still some slack in the economy. we have a bigut portion of the workforce that has not reentered yet, so that's like com could come out. by the way, you saw parallel discussions out of japan. i think the world would like to see a higher rate of price appreciation and then deal with it if it manifests itself. >> if you're right, doesn't this

bill disaster for anybody who is long the back end of the yield curve? >> one of the things we have talked about over the last few weeks as we don't think you should manage your interest-rate exposure over the longer term. pressures one some the back end, inflation running hotter. there are ways to generate return in markets they give you enough yield that you don't have to take as much long interest-rate exposure. , the clear, certainly markets will want to test. messed 62fed that time since of december 2008 and has only once moved interest rates higher. this is a market that wants to see it. the 10 year is way too rich? >> yes.

growthtalyst of economic and inflation, the inflation market is doing better. i think it will push it back. over the next couple of weeks? i'm not sure. >> at the same time, you have nominal rates, negative rates in europe and japan, both central banks manipulating interest rates across the curve with some qe and more with what japan is doing now. is that just not going to continue to drive money into the treasury market and also to the long end? global bond fund. one of the things we have stated is inc. about where you keep your interest rate exposure. though central banks will keep rates low for a long time. ofthink rates in those parts the world will outperform the u.s. we think u.s. rates will move higher. bond fundsoking at that have exposure globally

where rates will stay low for a longer time, it makes sense to diversify our fixed income portfolio. >> we talked about japan. complexwere already after this latest twist in japanese monetary policy. how much how much more difficult does it make it? activelythe boj manipulating the long end of the yield curve. is that a market or central planning? >> it is historic. haven't seen anything like this and 50-60 years. it is complex to manage. they set a rate that was certainly behind where we were. the thing was that was over the top issue had very negative rates on the back end of the yield curve, and that is something creating real volatility, concern, and now -- by the way, they will tilt their

purchases more to the front end of the curve, helping the banking system, helping insurance companies. i still think zero or negative rate is not right for the system. the financial system can't function and less banks and insurance companies make money? letgain, if the fed will inflation run hotter and we will see the back end of the treasury curve steep and, isn't that effectively what the fed is doing here? >> no doubt. listen, it would help pension funds. i think the world, the traditional dynamic of dropping interest rates works until you hit a point. you hit a point where it goes the other way. tell the interest

margin, capital, so would you do? you can't grow your assets, particularly in negative rates. if you let rates elevated little , and iu see how banks do think it is exactly right. i want your perspective on a conversation i had with janet yellen. i asked her why there is this discrepancy between what the fed anticipates for gdp growth, low, andand 1.8% thereafter, this fate that eventually they will be able to get the neutral , andif you will back to 3% she said it is partly because we don't have productivity growth. but you don't believe we don't have productivity growth. >> there are a series of things that way on the traditional measures of gdp. we are capturing a tremendous amount of the economy that works through the technology dynamic today. if you take the things we can count, how many people are being

er economy is operating at a good level, but the traditional measurement, think about the industry's hiring, health care, restaurant, labor-intensive, so productivity comes down. i think the economy is growing. can we grow more? absolutely. i just don't think that traditional gdp measurement, it's not terrible in a world where global growth is more -- >> are they overshooting or undershooting on the growth expectation? the fed has had longer dated rate expectations that are significantly higher, and we don't seem to be getting there. thatarkets have told you we have to see the rate move. dubiousthe markets are you will get a significant amount of rate increase from here. >> great seeing you. thank you so very much.

matt: and he is a cool guy. thank you so much. let's get to mark crumpton with the first word news. police in charlotte north carolina hoping for aps own night after two nights of violent protest falling the fatal shooting of a black man by police. u.s. attorney general loretta lynch is calling for calm. i urge those responsible for bringing violence to these demonstrations to stop. you are drowning out the voices of commitment and change, and you are a string in our communities. >> the charlotte police chief won't release the video of the shooting until after the victims family sees it first. governor patrick rory has declared a state of emergency. the mayor of charlotte is considering a curfew.

companies told employees in charlotte to not go to work today. a republican-led house committee is holding an employee who set up to the clintons private e-mail server in contempt of congress. the vote was 19-15. the resolution states he did not comply with two subpoenas ordering him to appear before the panel. mitch mcconnell has unveiled legislation to prevent a government shutdown next weekend that would provide more than $1 billion to battle the zika virus. there would also include 500 million dollars to help louisiana rebuild from last month's devastating floods. criticizedmmediately the proposal for failing to fund one of their top priorities, money to help friend, michigan repair its tainted water system. mitch mcconnell's move could set up a showdown vote next week. a coaster rico volcano remains .ctive

the volcano erupted on monday and tuesday, prompting authorities to temporarily close the capital's international airport. video showed several eruptions, at least one of them reaching 6000 feet. global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. scarlet: thank you so much. coming up, coffee one of the best performing commodities this year, but one type is seeing its lowest inventory in 16 years. we have the charts you can't miss. this is bloomberg. ♪

joe: i am alix steel. "what'd you miss?"

a caffeine low. one of the best performing commodities is coffee. there is a concern a drought will hurt brazilian output. you are looking at the price and supply situation for the coffee favored by starbucks. down thes been going last couple of months and years. it is at the lowest since march 2000. , prices aretime turning higher. look for that rally to continue is stockpiles continue to shrink. matt: do you drink coffee? scarlet: no, i don't. have seen joe at 5:00 in the morning and he has already have three cups. joe: that's true. here is a chart i look at from time to time, one of my favorite

indicators. one of my favorite ways to look at it as nonseasonally adjusted claims smoothed out. we have a killer number, the 52 week moving average line hitting a new low. it is amazing how stable it is. you like to point out initial claims over four decades since they have been this low. things thatof those if the economy were slowing down, we would expect to see this increase. it is just not happening yet. that is one solid piece of the labor market. scarlet: is this seen as a lagging indicator? point in the cycle, some say it would lag, but on the cycle typically. to nina haven't talked

lately. we have some interesting figures ostat on the asylum coming into the european union. germany had state elections in berlin a couple of days ago, and the right wing party actually one seats there. reasons is that so many of the refugees coming into the eu are going into germany. 61.1% of asylum-seekers went into germany. 16%any's population is only of the european union, so it is excepting a disproportionate share of the asylum-seekers. the rise of robots destroy your job?

our next gases, don't worry. this is bloomberg. ♪

>> let's get to first word news. donald trump is calling for a dramatic expansion in domestic energy exploration. he wants a time, scale back of regulations meant to protect the environment and public land. speaking at a conference in pittsburgh, pennsylvania, trump blasted hillary clinton's energy plan. war onary clinton's energy will cost our economy $5 trillion. she has not only declared war on the miners, but on all oil and natural gas. 10is war which supports

million jobs in the united states, and you people know it is war. it will be worse under her than it has been under president obama. hasecretary clinton advocated a move away from dirty fossil feels. a billsident will veto allowing 9/11 victims to sue saudi arabia. that word from white house press secretary josh earnest who u.s.ves it leaves officials open to retaliatory lawsuits and foreign cuts. donald trump has eliminated more than half the 16 point lead secretary clinton had in august. 37%,ow leads from 44% to gary johnson 8%, joel stein 1%. general says a rocket that landed on a base in northern iraq contain chemical agents that cause human skin to blister.

he made that disclosure at a senate armed services committee hearing today. a report yesterday said islamic state may have attacked the base with chemical weapons. he said unequivocally that the an "sulfurtained on "s blister agent." global news 24 hours a day powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. we have a fat-spurred rally for the second day. the dow up by almost 100 points. it was green across the board for all the regions. commodities gaining, bonds gaining, the exception was the dollar. joe: it was dollar down and everything up. "what'd you miss?" goldman sachs says do not fear the robot.

new technologies are actually creating more opportunities for workers. is the us to discuss global head of investment research for goldman sachs. this has been a huge topic in idea thatrs, this technology is going to shut some people out of the workforce essentially. you see it on the campaign with the promise to bring back physical labor, manufacturing. report outy had a that was far more optimistic on the future state of the labor market. what is everyone getting wrong? is not destroying jobs. technology by and large has the function of allowing you to do more work more easily with less resources. that is what productivity means. the new jobs are typically and things that no one thought of

before. today, the jobs you have nobody would have dreamed of in 1910 or 1950, so it is about entrepreneurship and new jobs. it is not the machines that create the jobs. ,att: do we have a labor force the bulk of which is trained to do the old stuff and the time like it takes for that labor force to be retrained to do the new work is getting longer and longer? >> this is where the real split and problem is. new worker coming through an educational system, this is an opportunity. what has gotten tougher and tougher is for the worker who has been displaced to recast themselves into the new economy. we have gotten into a situation where the displacement is occurring faster, and yet the ability to recast yourself has gotten harder. in the economye where we need to fix something

to make it easier for people to reallocate themselves in the labor force. scarlet: it comes back to rate of change again. thatave a chart illustrates how occupations and industries follow this natural evolution. earlys have pricing power on, then they become full normal to automation, outsourcing, and falling wages. doing the work has turned into supervising the resources behind it. why doesn't that part of the evolution involve fewer people doing the work? >> it does. that is a good thing, not a bad thing. when you come up with something new, you need lots of people to figure it out. you essentially throw resources at it. to do it,ure out how you become more productive, prices fall, service improves, and that his what creates

welfare in the economy. then you have to restart that process over again. so the magic of the whole system is you learn how to do something new. at the beginning, it is very expensive, and in you figure out how to do it cheaper in the jobs go away. then you think of something new to do. if: i think it is clear that you look throughout history, there have been profound shifts in how people work. worry point, there were more people working on farms than there are now. then they went to manufacturing jobs or something else. now those are on the decline and more people are working in offices. timehing that makes this fill different is that technologies aims to be replacing what we can do with our brains. robots,al intelligence, what is our competitive edge once technology can essentially

take over? >> if we get to the world where there isn't a ex machina artificial intelligence -- joe: then what. matt: that's the scary part come the leap in technology. >> one of the things that happened is artificial intelligence became machine learning. it is critical to understand what machine learning is. you realize it is the same thing we have already been through. we have a lot of data, then the machine can figure out how to do stuff because it processes a lot of data well. that is how technology has always worked. once you are doing a lot of something, you can build specialized machines, create processes, then technology displaces it. .t is true

if you're not doing a lot of it, you need creative people to experiment, to guess, to create. when you look at all the economic stick to sticks -- statistics, the one that is worrisome is that you see fewer small businesses created today than there were. those were the people that created new job categories that employed people who were displaced. scarlet: what is the prescription then, federal level, local level, to address this job cap? that in smalls business what you are concerned about is the ability to finance and create small businesses. that has become a difficult process. in terms of people, the problem is understanding who has been displaced. that's the worker who is in a old job category that is going away. lot more help than

any of the systems currently give them. needu are 45 years old and an entirely different type of education, that will take a lot of help. the real problem has always been that when we look at education for society as a whole it makes sense for those people to change jobs. when you look at the individual, it is om is impossible for that individual to take that much risk. entireve to put their life savings into one shot for one move for one job. that is too hard. joe: a lot of technology optimists like to talk about the dynamism of the new economy, but there is one bookstore, amazon. it looks like we are a series of monopolies that is hard to break into. facebook doesn't have any competitors. that will be the place people only get news one day. maybe amazon will be the only place people buy stuff. not enough newt

business is being formed, how much of a problem is that so many of the new industries seem to be winner take all? farms went from 40 acres to 100 acres to 1000 acres to 20,000 acres. that is always what happens with old industries. what you have to look at are the new ones. health care, personal training, private wealth management, anything that involves individuals on individuals, personal services, those categories are well-paid and they are very human in their nature. will see with most categories that the ones they get done a lot will be subject to machine learning. the ones that are new and different will create a lot of jobs. it is the respect for that dynamic. one of the key problems with the policy process is that it insists on preparing people for jobs that used to be plentiful. going toneed if you're

go to new jobs is resilience and support, not a specialized, organized training program. isvitably if that program not organize, it is for yesterday's job. joe: fascinating conversation. thank you for coming in. live, unscripted, and utterly unpredictable, the first presidential debate is monday and expected to set new records. we will tell you how the candidates are preparing for the big night. this is bloomberg. ♪

matt: "what'd you miss?" the gloves have been off for

months between hillary clinton and donald trump. into thehey move sparring ring for the first time as their three debates kickoff. candidates preparing for what many call the most anticipated debate in u.s. history. i'm sure that we often say these are the most important debates in history, but now it does seem like the country is more polarized than ever before. is there statistical data to back that up? >> definitely. we have seen polls that have shown neither candidate getting above 50%. both of them have high unfavorable ratings. we see donald trump getting high ratings from republicans. hillary clinton getting high ratings from democrats, but neither one of them breaking through to independence. we expect this debate to be one of the biggest television

spectacles of all time in terms of viewership. right now they are hitting a ceiling, not being able to get beyond their base in terms of the polls. joe: i read some stuff about hillary clinton preparing to debate by figuring out how she can set donald trump often what needles him. i want to know what else we know about her debate prep. campaigns tell us anything about their debate prep? why give up any hints about how you are preparing? of it is that reporters want stop asking them about it. a serious level, part of it is doing the pre-spinning, the debate before the debate in terms of the expectations debate. tolary clinton is trying

make sure donald trump is not held to lower expectations than she is. she wants to make sure that when she goes onstage that there is a level playing field. her campaign officials say that thatgh the primaries donald trump was graded on a curve. know hillary clinton is studying up on her own policy and the long list of things that donald trump has said. he said a lot over this campaign and his business career, and a lot of that gets forgotten. she wants to be able to hold him accountable when they are on stage together. i wonder how much of this will be them talking past each other? onory clinton prides herself her knowledge of the substance of the issues, and donald trump is obviously much more talented at the style part of it. they ignorent are alleging they would just focus

on their strengths. >> donald trump has not done what hillary clinton has done in terms of scaling back his campaign schedule. he is not spending asthma much time boning up on policy. he wants to focus on showing strength, putting hillary clinton on the defensive. to focus on be able her policy, the things donald trump has said in the past, so we will see two very different styles and it will be the opportunity to see how they play against one another. verye looking at two different candidates, one, a political insider and one who is coming to this fresh and will bring a completely different style and somewhat different substance when they step on stage together. debates aside, there have been some good polls for hillary clinton lately. there was a poll yesterday showing her gaining a solid lead. field thelinton camp

metaphorical stumble of her campaign is back on track? they still feel strong. looking at the electoral college, they still have the upper hand, but it is deftly not a done deal. it is very clear that hillary clinton has a bit of a firewall, electoral college gains in the states where she is ahead, and if she stays ahead, she will be president. if donald trump is able to turn out his base and when , so it is deftly not a done deal. joe: thank you for joining us. tune into bloomberg television at 8:30 p.m. eastern time on monday for the first presidential debate. it will be streamed through a

new partnership between bloomberg media and twitter. scarlet: the bank of china's new the firstnch will be yen-clearing bank in the u.s.. what does it mean for the chinese currency? this is bloomberg. ♪

scarlet: i am alix steel. "what'd you miss?" yorkank of china's new ranch will be the first yen-clearing bank in the u.s. why is this designation so critical? >> it means more business for the bank of china. big have had a

presence in new york where they have done financing for real estate projects, but this is a very big moment for him. they are able to do more business, to internationalize the currency, and i was at an event with them yesterday and they were expressing -- they were all wearing red ties because they are celebrating this, and they said they were surprised the approval came quicker than they thought. it may not come until 2017-2018. they were pleased with the central bank decided to approve this quickly. it is all in line with the internationalization -- a red tie a celebratory signal? >> yes. the vice premier when this

announcement was made the other that u.s.id before banks are invited to apply for this, but why haven't they? be thathe reasons may in order to do so that they have to submit a lot of information to the chinese central bank, and there may be some concerns on the u.s. side of disclosing too much information to the chinese, so this is why there haven't been any approved yet. although the chinese say the that there is going to be at some point down the road and approval. joe: i have walked by this bank branch several times. is there a retail component? >> i think so. they do have some retail operations. would be an unusual customer, joe, but yes, you could be a customer.

their focus is on fortune 500 companies and small and medium-sized businesses. care of onell taken the retail side in china. what they are looking for our financing projects here and companies, but big corporate deposits. tell us about the big china postal savings ipo. >> speaking about thinking -- companiesd these becoming more internationalize, this is china's savings postal bank, 40,000 branches in china. kong,o will be in hong 7.4 billion dollars, the largest chinese ipo since alibaba. a lot of people watching this one closely. 7:00you can catch betty at

a.m. hong kong time for bloomberg's "daybreak asia." scarlet: what you need to know to gear up for tomorrow's trading day. this is bloomberg. ♪

matt: don't miss this.

tonight. manufacturing one of the greatest days of the month. pmi for thoseone of you who like to get an early start on the day. be looking at u.s. manufacturing pmi out tomorrow. been so-so, and so all this data matters now. i will be paying attention to that. what's the difference between regular pmi and flash pmi's. joe: they don't have flash bmis in as many countries. they are done partially through the month. they have a smaller survey sample, so theoretically more volatile. they are usually directionally pretty solid. how fun is that? scarlet: thank you for watching.

matt: we will see you back here for the pmi party tomorrow. joe: have a great evening. this is bloomberg. ♪

♪ john: it is the latest word is under the first presidential debate, and one major story is dominating the national news. charlotte, north carolina. the second night of violent protests after the police shooting of an african-american man on tuesday. today, salads chief of police said the video of the shooting supports the officer's version of events, but does not definitely show scott pointing a gun at police. he