with the matter, he told energy in the u.s. to stay on the deal. emmanuel macron and president trump declined to answer questions about the paris agreement. the u.s. trade representative robert lighthizer made -- gave his first major speech today since being confirmed in may. he said china's economic model represents a challenge to the world trading system and can't be addressed under current global rules. >> the scale of the court knitted efforts to develop their economy, subsidize, create national champions, force technology, and distort markets in china and throughout the world is a threat to the world trading system that is unprecedented. heisermbassador light added that the problem with china is substantially more difficult with -- than those faced in the past.

michael flynn is getting help from his family in setting up a moneydefense fund. the will help cover legal fees for the investigation into russian meddling in the 2016 presidential election. flynn is among a dozen former trump campaign officials that could face steep legal costs following the appointment of special counsel robert mueller. misled vicedly president pence. he resigned weeks after president trump took office. barack obama has become a hit on wall street according to a person familiar with the matter. he was paid $400,000 last month to speed to clients of northern trust. last week he spoke to carlyle atup and next week, speaks the health care conference. global news 24 hours a day

powered by 27 hundred journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. ♪ live from bloomberg's world headquarters in new york, i'm julia chatterley. scarlet: i'm scarlet fu. joe: i'm joe weisenthal. julia: 30 minutes from the close of trading and optimism is in the air. joe: but the question is, "what'd you miss?" scarlet: senate republicans making one more push to repeal obamacare and democrats think it could be a serious threat this time. revealing all in an hour long sit down with erik schatzker. and buying to be the next headquarters for amazon, wantingphia mayor philadelphia to be the next big tech hub. julia: an inverted yield curve

no let it in 1969, but reason to wait and see if that happens. economist chief calling for elevated recession risks in 2018 and joins us now from charlotte, north carolina. great to help you -- have you on the show. talk us through this inverted yield curve. and why in your view we don't have to wait because you've got a better message of watching this. >> an inverted yield curve sometimes misses recessions. , often times it is missing that recession and predicted way in advance. we are interested in how to get to that inverted yield curve. sort of a signaling process. a fella named michael spence has

been on bloomberg several times. we need a signal. what is our signal? the interest rate rises above the lowest level of the 10 year during the cycle. that is that signal. and it makes sense that it has to happen before the yield curves. framework with a new that you believe is a better predictor of when recession might be coming? the spread between the u.s. 10 year yield and the federal funds rate. 5001. , you sayd raises rates the prospect of a recession has increased? >> absolutely. that is the signal that tells the market two different things. that the fed is serious about raising rates and the curve will invert at some point in the future.

fed is raising those rates, you think about all those instruments, bonds, and notes that were bought before at lower interest rates. all of a sudden, there is a question about the total return that it will be. predictors both as a of where rates are going, but also the indication of what's going to happen to the value of instruments you brought before in a fixed income market. joe: can you explain the logical intuition? can you explain why it would do and is there an elevated risk in 2018? are you able to currently point to anything in the current economy that offers some warning signs? >> interest rates are a signal of what going to happen in the future. there are two signals.

one that they are serious about going to raise rates and therefore, you will get an inverted yield curve sometime in the near future and second, what happens is you are signaling that all the fixed income instruments at lower interest rates are going to be losing their total return value. that, itrn, looking at .s the underlying theory orthat sometime in 2018 2019, the ranges are the wide. that is going to be that time that we have to be very careful. what do we see now? are delinquency rates rising. home sales are not quite as strong. between the deflator and the intended federal funding

is increasingly shrinking. we are going to get there. we are in unprecedented times for so many reasons. could this time be different even as it looks like a bank perspective. the bond buying we are seeing. i know in your note you say that if we look at the current economic outlook, the inflation aspect. it is tough to say, isn't it, to else,t given everything what it says about the future? >> it is very difficult. when you're looking at the yield curve as you suggest, if the

rates are coming down simply because there is a huge demand for those types of instruments, that yield curve inversion is not really a signal of rising inflation that the fed has to follow, but a very strong demand for those type of assets. if we get a recession, will you expect it to not look like the 2009 or 2008 depression but a more mild one? a garden-variety recession, a normal one? >> i think you are entirely right. you don't have the conditions where credit markets in housing and autos are so significantly what thene with fundamentals of those individual markets are. chief economist for wells fargo securities, think you for joining us. coming up, how tax reform can affect 401k's.

guest says workplace savings plans need to be expanded and improved. this is bloomberg. ♪

scarlet: lawmakers looking into the possibility of eliminating pretax 401(k) contributions that could mean big changes for the way that joe, julia, and i save for retirement. the ceo of great west financial is also the author of a new book called from here's a security -- from here to security. inc. you for joining us today. this is a nonpartisan practical guide for making retirement savings systems work. thus far, your take on the 401(k) retirement savings is that it works but could be

expanded upon? >> it definitely works. the results are in and it shows that if people take advantage of the pension protection act that passed in 2006, put in automatic enrollment, automatic escalation, and have target date funds. overe are on track to save 100% of their earnings for retirement. julia: so what do you make for the plan of the government? we lacked clarity about the tax reform, but the impact it could have on pretax contributions. there is a suggestion that we could go from pretax to post tax. many implications. how concerned are you buy what you read? >> right now, contributions are pretax.

is a roth 401(k) which is available today. people can contribute after-tax. the difference is, the way it currently goes, pretax goes tax creep -- tax-free. gross tax-free and you take it out tax-free. i think theand concern of people in the industry is that it will cause people to make less contributions or not participate because it is not contributing pretax. they are trying to get boxed in really quickly because they need to finance this tax reform deal and the expense of , less savingsorm by individuals as far as retirement goes. >> what happens is, they have a scoring system. they look at scorn over 10 years. a long-term savings vehicle. issues are gone

forever from the treasury. home mortgages, state taxes, things like that. tax-deferred, meaning you don't pay tax now, but when you retire, you pay ordinary income tax. congress looks out over a 10 year window, totally overestimates the cost of treasuries. it would be a huge mistake. i have a question about pre-retirement behavior and how people invest. we have seen extraordinarily low interest rates as the financial crisis. and there's one school of thoughts saying low interest rates help stimulate the economy. if you are not getting much on your savings.

extendedately, this time of low rate forces people to sock away more for retirement. like the actual consumer response to fed policy? >> it is very age-dependent. if you are older or in retirement, a low interest rate environment is not good. where you have time to accumulate, you need to save 10% of your income. that should be everyone's target. save at 10% and the system works for you. there are millions of workers who are doing that. we know what works. and we are trying to encourage congress and companies to put rules and the place. it is optional.

let's make it part of the system and you will have a much better retirement system on the private side. scarlet: we have 401(k)'s because we work at bloomberg that for others, it's not an option as much. >> small businesses now, they cover 60% of working americans. the other option to get to 40% covered. you get other things and they have this same advantage as people in workplace savings. a coverage model to get people to participate is essential. one example is employee benefit research institute looked at

middle to lower income workers. those workers contribute 70% or 80% level. if you look at the exact same demographic that do not have work place savings, less than 5% of savings and retirement. we will do everything humanly possible. joe: confronted with a basket of options that are high fees and not particularly trans parents. >> of the automatic enrollment changed the participation rate from 70% to over 90%. every company should have automatic enrollment. participating or you

tell us not to. that it madeng is target date funds a choice. , with all the discussion on fees and etc., there is low fees. i don't think the fees are a huge issue today. bob reynolds, ceo of platinum financial. how workplace savings can keep america's promise. the time for the stock of hour. tumbling today are shares of tenet healthcare. hospitals and health care facilities company. why the stock is on pace for its worst day in a month is abigail doolittle. abigail: repeal and replace his back.

senate republicans are making a last-ditch effort to push through or pass another version of this bill. it the reason it's a last ditch effort is they have to be the deadline of september 30. september 30 allows them to pass this bill with just 50 votes as opposed to the normal 60 votes. there have been several efforts at repeal but hospitals are right in the crosshairs because lower spending means fewer people and more spending means more people. it's not a regulation thing, it's just a money thing. abigail: i was told that 8% to 12% of off its come from obamacare. obamacare goes away, that chunk goes away. , they go topoint the hospitals and the burden is on the hospitals. a hospital cannot turn away individuals for lack of health care. they will be talking about the prospects for getting just 50 votes.

in terms of stock reaction, we got to a point where these stocks reacted very little. they were kind of numbed by the process here. >> i remember these stocks being pretty wild. you may something that be bringing up, whether or not this will actually go through. and berg intelligence makes the point that nothing has been passed in eight months. is this an overreaction? g, aalso, predictit.or statistical organization say on the provision around individuals not having to have insurance is at 34% after arizona governor doug ducey says that he supports this and the justice center and john mccain may support it. julia: it may reversed by the end of the week. next, sharing a

vision of brexit. he finds himself scolded by the prime minister and the u.k. civil-service because he didn't have permission. we will be discussing from new york. this is bloomberg. ♪

joe: i'm joe weisenthal. "what'd you miss?" see's something you don't very often, the u.k. statistics authority reprimanding boris johnson over his use of what it calls a misleading figure. this is the letter the statistical chief published that claim in ann made a article that the u.k. could bring back 350 million pounds a week after brexit. this was a key talking point of the leave cloud during the

brexit referendum. the number has been wildly disputed. he wrote this controversial letter. bringing back this figure that had been rebuked. you see chairman of the u.k. statistics authority writing to johnson saying that i am surprised and disappointed that you have chosen to repeat the 350 million pounds per week in connection with the amount that might be available for public spending. i don't think of seen anything like this before. blastingstical chief someone in government for this figure. julia: this was the brexit slogan and on the side of his bus. it has proven that when you bring in all the rebates margaret thatcher wanted, it's more like 160 million and that is even tied up for a number of years. that is where they go to spat with statistics agencies.

i think it is sort of big picture taking a step back here. scarlet: what is he doing? toia: he was put in office get as far away from the brexit talks his office all -- as possible. and doing it openly and publicly without permission from the prime minister. joe: they have no idea that this article -- julia: apparently not. question ongreat bloomberg markets. his theresa may powerful enough to get rid of him here? he said he wasn't going to resign today. is theresa may powerful enough to get rid of him? it remains an open question. scarlet: it looks like a naked power grab. julia: his decision to be pro-brexit -- scarlet: is he popular among the tories? julia: he's not talked about as a potential leader. the index leading a popular

person and it doesn't belong to either. let's talk about germany because a want to have a look at the german election polls. it is very interesting in terms of angela merkel, expected to and her with her cdu, sister party. social democrats coming in at 22%. those two of the three collectively have formed two out of the last -- scarlet: in the red line. julia: who is the official opposition? the liberals, the free democratic party, or the party everyone knows about when they talk about germany, the afb? they are pulling very closely together. joe: you see the blue line kicking up, showing some momentum. julia: the king makers want to bring putin back to the g7 and make it the g8 again. we will talk more tomorrow.

yay. scarlet: the market closes next in the u.s. and here are the major averages area the dow building on a record high. this is bloomberg. ♪

joe: u.s. stocks advancing

today. fresh record highs. ahead of the fed meeting and the president's address to the united nations general ssembly. joe: if you're tuning in live -- julia: if you're tuning in live on twitter we welcome you to our coverage every day from 4:00 to 5:00 eastern. scarlet: another day of record highs for the dow and s&p 500 the dow now gaining for a seventh straight day adding 65 points. the s&p 500 holding well above 2500. 25.04 after breaching that level on friday. the nasdaq also inching higher. julia: new highs over the 2500 level -- joe: new highs over the 2500 level. we broke it friday and continuing to stay up today. scarlet: let's tell you about stocks that declined. the leading u.s. hospital company or one of the leading u.s. hospital companies getting

hit as senate republicans make one last desperate push to repeal obamacare before a deadline at the end of the month. ubiquity network down about 6%, caution serious red flags there and talked about the word fraud when it comes to the company. the company, itself, has denied that. orthrop grumman is trading a the a record high the best day since november after making a $7.8 billion purchase and nvidia record highs also a record high gaining after bank of america raised the price target. because of cap x on data centers. now one headline that broke right before the close is toys r' us preparing to file for bankruptcy as early as today. this is according to people familiar with the situation. they asked they not be identified. toys r' us has declined to comment. this has huge implications for

toy makers like mattel and hasbro. we had seen some weakness in those companies in the days leading up to this news. joe: and now a look at the government bond market starting in the u.s. with the two-year and 10-year, yields both up on both of those 2.23 on the 10-year so several up days in a row for the long end the u.s. yield curve fitting with the general equity rally we've seen. the risk on mentality of late. 2.085 a couple weeks ago. i want to spotlight portugal. big drop there in long-term rates. friday after the close s&p the ratings agency coming out and saying that portugal is now investment grade. this was at one point one of the classic peripheral basket cases and a couple years ago it elected a government that made the markets very nervous. things have really quieted down in portugal and we see yields here at 2.4% on the 10-year.

julia: thanks for that. moving on let's look at the dollar today. that is making gains. actually the biggest mover today is sterling. sterling losses relative to the dollar snapping a two-day rally. last week sterling had its best week since 2009. the beaverage of england governor is speaking at the united nations meeting here in washington this week and said monetary policy has more room in order to stand still. rate hikes will be gradual and the global rate may be rising. i think a few people who have been perhaps looking at the movement we sa you in the market last week are wondering whether that was him just softening the tone slightly. quick look at dollar cap as well. the deputy governor this time on the tape suggesting the bank will pay close attention to canadian dollar strength. and on an otherwise quiet day

you can see canada under a bit of pressure here lower by the -%.lar for some 0.8 joe: let's look at commodities. not a ton of action there. in fact, crude oil didn't even change on the day holding just below $oo a barrel on west texas intermediate -- just below $50 a barrel and gold off by 1%. $1311. those are today's market minutes. julia: on china, china's holdings of treasuries rising r a sixth straight month actually the highest since august of 2016 in terms of individual numbers here the treasury holdings rising $19.5 billion to $1.1 trillion in july. some of the other numbers as well. next selling of foreign net selling of treasuries with $490

million in july. the net buying of agency debt $10.3 billion in july. and other headlines on that and i'll bring them to you but for now as you can see, rise for the sixth straight month in china's holdings of treasury, yay, keeping those yields down. scarlet: record high for the dow and s&p 500 to kick off a big week for the president's first u.n. general assembly. thanks so much to our guest for joining us today. quantitative easing obviously helps stocks, helps risky assets. u.s. stocks wouldn't be at record highs if it wasn't for years and years of quantitative easing. what we are likely to get on wednesday is the start of quantitative tightening. is it logical to think that would take some of the air out of the prices? >> a great question and we're not overly concerned. look at the numbers and actually what happened with quantitative easing. the federal reserve basically increased the securities

holdings by about p.7 trillion. on wednesday we expect them to start normalization. that is going to start pretty slowly. 10 billion a month up to 50 billion a month. if you look at it and model it out over the next thee years they'll take approximately $32 billion per month out of the market. if you model that out over the next three years it'll take 1.3 trillion or so. that is only one-third of what was put into the market. so very slow, very gradual, very deliberate. it shouldn't leave any near-term fireworks in the market at all. joe: is it tight snenk i get it is a steady pace, not that big in the grand scheme. is it tightening know is it the kind of thing that should be o know a preset course so if the economy deteriorates should it be a fool that the fed then dials back or slows down? >> yes, it is tightening. it is a removal of accommodation from the market. the tapering purchases actually

balance and it is definitely tightening. should it be a tool they look at? the fed was certainly spooked by 2013 and bernanke's testimony and rates rising quickly. so i like to refer to it as peak central bank transparency. this fed is going to convince everyone what they're doing every single step of the way is very slowly, very deliberately. certainly not a preset course. they've built out a preset course but to the extent they saw a large rise in 10-year rates or unforeseen move you can expect them to dial back right away. julia: we've spent a big chunk of the show talking about recession predicted. what do you make of the movement lower we saw in yields in the 10-year to just above the 2%? how should we be looking at that? particularly given they've inched higher since then? what is going on in the market? >> that took a lot of people by surprise. our forecast is for higher

10-year rates. we weren't shocked by the dropdown of 2%. a pretty simple story and it's been that way for a couple years now. you think of it as the helium balloon and the lead weight. helium balloon is the fed rising, inflation going. but the huge counterweight of the helium balloon and it is global rates. this does not surprise anybody here. japanese rates, zero. switzerland, you know, negative 10. so any time you see disinflation like we saw, down to 1.7, core piece up to 1.4 you can expect treasury yields o follow that. now, what we like to see now is c.p.i. is flatening. the report last week was good. we're calling for acceleration and inflation of growth into q 4.

joe: here is what i don't get about the global story. last year there were some arguments the fed should delay rising because there is all this. europe, all these elections, china wobbling. the global growth picture according to everyone we talk to is about as good and coordinated and synchronized as we've seen in a long time. europe seems to be enjoying the best post prices growth. china has been very quiet. no signs of any real financial --. joe: motivated to keep it quiet. joe: why hasn't that translated into higher rates? the global picture seems benign. >> that is a great question. we see the expansion. we think we are in a good part for the profit cycle but there is still excess liquidity abroad. unfortunately most of us spent our careers or fortunately anyway before the global financial crisis. the premiums you can get on any assets now versus what you get before the financial crisis are all lower. as an example used to get 2% over inflation for your 10-year treasury. right now you're 50 dips over

inflation actually the average you got the last seven years so it is risk premiums have compressed. even though the profit cycle accelerating, global guys, there is still a massive amount of securities on the fed's balance sheet, on china's balance sheet. on the japanese central bank's balance sheet. so the stock of all of those bonds is going to continue to keep lower rates than you expect in a normal environment. julia: great to get your insight. thank you. ow coming up, at times the charmed senate republicans are taking another stab at the affordable care act as the reconciliation deadline closes in. we'll be discussing from new york. this is bloomberg.

>> it's time now for first word news. president trump and chinese president ping spoke by phone

today about north korea. mr. trump is here in new york attending the u.n. general assembly which president xi is skipping this year. both leaders committed to "maximizing pressure on north korea through strict u.n. security council resolutions." in recent weeks the council has voted unanimously to tighten sanctions on the communist country. the turkish army has begun military drills in a show against kurdish and iraqi kurdish independence. the military exercise, which takes place near the iraqi border, comes ahead of next week's independence referendum. iraqi kurdish leaders have rejected u.s. appeals to postpone the vote. the turkish government fears a sovereign kurdish state would encourage its own turkish separatists. turkey has called the referendum "a matter of national security." excessive diesel emissions have caused more than 4500 premature deaths in europe. this according to researchers' findings. the tiny particles emitted are

hazardous to human health and contribute to 425,000 estimated annual deaths from air pollution in the european union, norway, and switzerland. auto makers have faced scrutiny after volkswagen was caught cheating on emission tests two years ago. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. l i'm mark crumpton. this is bloomberg. scarlet: the repeal and replace effort isn't over. with eight congressional days left to push through legislation under the reconciliation 50 vote threshold senate republicans are reviving a last ditch effort to oust the health care law. a proposal by senators graham and cassidy is now gaining traction. let's bring in our national political correspondent from capitol hill. the democrats are sounding an alarm saying this could be a big threat. is there reason to think the gop please -- the gop is closer this time around?

reporter: the democrats are certainly worried and have good reason to be. they are definitely close. republicans came one vote from passing what they called skinny repeal in the senate last time. this current version led by senators graham and cassidy seems to be close. i spoke to two senators who are right on the cusp whose votes will probably be needed to pass this, lisa murkowski and john mccain. just in the last hour or so murkowski said she is doing her due diligence and wants to know how it affects the state. senator mccain said he is not supportive yet. he didn't completely close the door to voting for it but it is hard to square what he said moments ago with him voting for this bill because he said he wanted it to go through the regular order. they have 12 days to do this. there is not going to be a full score in the next 12 days so they'll be flying blind a little bit. joe: what is graham cassidy? some of the critics say it takes a deeper hatchet to obamacare than any of the votes that couldn't even get passed before. reporter: well, the skinny

repeal bill, joe, didn't do as much as graham-cassidy will. this goes further than the previous senate effort and keeps most of the obamacare taxes and uses that money to simply block grants to states. it cuts medicaid by over a hundred billion dollars over the next decade, a sticking point for a number of people including susan collins, lisa murkowski, perhaps also john mccain the three people who killed the bill last time. they had 49 haft time. it is not clear where these three are. they need to get to 50. far from clear. this is a half-court buzzer beater. don't count it out until the clock strikes zero but it is a long shot. it still could happen. scarlet: there is only one republican senator who said he would vote against it. that would be rand paul? reporter: that's right. rand paul. if you include him you need 2 of the 3 senators who voted against the repeal last time for this. an uphill climb. scarlet: thanks. julia: the economy is in a

sweet spot with g.d.p. expectations rising and the central bank comfortable hiking rates. also strengthened against the dollar since may. up 8%. what is going on with canada's momentum and what is going on with the central bank? that is the big question. great to have you on. if you were an investor in canada right now i think you are having a bit of a shock wondering what on earth is going on with the central bank. talk to me about what happens in the september rate hike and in the july rate hike when one seemed to be super signaled and the other completely out on its own completely unsignaled? >> it was a july interest rate hike in the first in nearly seven years then went on vacation. the only reason people thought they'd hike in july is the biggest reason, they telegraphed it with a series of speeches, full court press, then complete radio silence. in the meantime the data spoke fairly loudly. inflation clearly strong. picked up 4.5%.

now i think everybody is pretty into it's completely data dependent and you don't need to hear from them. they might surprise you. joe: it just shows how incredible the change in sentiment has been really in the last year. the white line is the yield on the canadian 50-year bond. the blue line is the yield on the two-year bond. the two-year now is yielding more than the 50-year was in july. i don't -- that is outstanding. luke: it is amazing. if there is one inference it is maybe that, ok. canada could be victim to the same forces every advance economy is, flatening yield curve but in canada the transition mechanism for monetary policy you don't need to worry about longer rates as much. the dominant mortgage product is the five-year fix. what you are seeing there, the shortened, would probably feed into economic activity and have a tightening effect sooner than later. julia: the small, open economy, super leveraged to the united states. what are they doing here, citing asset bubbles, going

back to sort of central banking evolved where you don't telegraph and that's ok? it used to be ok. or --? luke: i think in two ways, i think first of all hiking without fanfare like that and secondly they're doing it completely based on kind of this old school frame work where they see pricing pressures picking up down the road because they think canada has used up spare capacity. very much as simple as that. julia: you mentioned the housing market. house prices there are of concern. the elevation is a concern. luke: they certainly are. however, the bank has said many times that they think there is a fourth line of defense against that. they prefer macro prudential policy. they prefer to not have to deal with it directly. it may be in the background. that does help strengthen the case. joe: one story we haven't heard much about, fiscal policy when the trudeau government came in, infrastructure progets, as you report initially getting very slow out the door.

what is the status? luke: right now it is a meaningful impulse to growth and there is reason to accelerate. there's been 3,600 projects approved since trudeau came in. 15 finished. 200 started. a lot of room to run. and it's the repair construction that is the category you see the most upside as. that is the first one that gets going. you've got a lot more room for this impulse to kind of swell and continue for the years to come. julia: great to chat with you, luke. thank you for your insight. from new york. this is bloomberg.

scarlet: stocks at new highs put the commodity complex down about 3% creating a split among risk assets. what's next for commodities? >> thanks. joining me to talk about this, our bloomberg intelligence analyst in the energy and mining space. andrew, thanks so much for taking the time. you help me often on the energy and mining stocks. today we'll take a look at some of your charts. you are a charting expert, some of the charts you have showed me. behind the commodity complex is the dollar. you have a great chart of the dollar index. andrew: great to start off here. we think it has global implications for a lot of commodities. the counter trend move we expect off this trend line from the beginning or i should say the end of 2016, we see this horizontal bottom. it coincides nicely with the

fomc decision this week. the market is pretty short. the dollar right now, get some sort of catalyst, it increases with the odds of the fed hike in december and that would argue for a counter trend rally then we expect that to fade. you've seen positive divergence as well on the rsi. >> near-term bullish signals. why do you think the decline in the dollar has helped stocks but not the knotty? some of course have rallied, the metals. why not energy so far? >> energy is mired and that is probably the main reason it hasn't impacted as much as the metals. >> let's take a look. you have a great chart of gold, long-term chart, and it is 9535. take it away. >> you see longer-term wedge over a 10-year period starting from 2008 to the peak in 2011. woo he broke out more recent bely and are focusing on the $1400 level. you can kind of look at somewhat of a retest around the 1285 to 1295 level as we pull

back here so that would be kind of what we're watching right now. as you see at the bottom momentum is positive and we think that, you know, the global inflation story is accelerating, real rates are heading higher and gold can certainly head higher as well. >> one of the more exciting stories over the last week, up this year i think my memory, maybe over the last year up 500% over the last year, crazy increase. last week at one point down 25% then rebounding up two days in a row. last week the worst week since january 25. similar to gold, seen as an alternative, how does this play into gold here? >> i think it favors gold. it's pretty volatile and has fallen 40% in the last couple weeks. that kind of drives, some investors that may have been wishy washy on whether or not to invest in bit coin or gold i think it pushes people into gold for now. i'm sure there are crypto lovers out there.

>> finally copper of course a big winner on the year but last week we were seeing a sell off and you have another great chart here and i think the sell off may continue in the near term? >> we're targeting the initial levels to be somewhere around 63.50 level as we go through there, somewhere between, you know, 6100 to 6200. again, you can see where the bottom piece of the channel would intersect. you see momentum is still positive. and again, the fundamental stories aligning with the technicals, the market as we shift to 2020 is looking into being deficit so the market is going to anticipate if that supply deficit -- we'll need new supply and need copper prices in the 7,000's to get that. >> sticking with the fundamentals considering you are metals and mining and energy analysts, you always hear about copper being dr. copper. that it is a tell on the economy, the growth of the global economy especially relative to china. what do you make of that? >> i think things are aligning now.

copper declined for five years, more of a supply story. global growth was chugging along. now things are moving in concert. you've seen synchronized global growth, p.m.i. rising from the emerging markets to the developed markets. i think the stories are just aligning and certainly dr. copper is one that is a positive one from demand side as well. >> i love your chart. the dollar chart, gold chart, and copper chart. i'll be watching closely to see how they do. i have a feeling they'll do well. >> me, too. >> i like that. andrew cosgrove of bloomberg intelligence. back to you. scarlet: good stuff. thank you so much. ow coming up, -- julia: now coming up the mayor of philadelphia joins us next with the city of brotherly love 's plans.

i am mark crumpton. president trump says he and israeli prime minister benjamin netanyahu are giving it a go in the middle east peace process. "we are working very hard to reach a deal between israel and the palestinian authority." prime minister netanyahu said israel's alliance with united states has never been stronger than under the trump administration. both leaders are in new york for this week's u.n. general assembly meeting. theresaprime minister may is criticizing foreign secretary boris johnson for his unauthorized intervention in the brexit debate. the government is

driven from the front and is clear upon what the cabinet has agreed upon. articlewrote a news that suggested he was undermining may's approach. minister justin trudeau and theresa may say their countries are working towards a bilateral trade deal that would be in effect after the u.k. leaves the european union. >> this agreement will create jobs and stimulate growth for people in canada and across europe. prime minister may and i discussed the u.k.'s ratification of the deal, as well as the importance of stability in the canada-u.k. partnership into the future. mark: the deal would eliminate over 90% of trade barriers between canada and the eu.

prime minister trudeau said it would provide an excellent basis for ensuring a smooth transition post-frexit. peaceful demonstrators protested in st. louis today, protesting a white officer's acquittal in killing a black suspect. polices of riot intervened late sunday, seizing weapons and arresting more than 80 people. the case involved ex-police y's shooting of lamar smith. prosecutors say stokley planted the weapon. global news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. scarlet: let's get a recap of today's market action. record highs for the s&p and dow. for the dow, it is the 22nd straight game.

julia: "what'd you miss?" philadelphia is in the race for amazon's next headquarters. the city of brotherly love is bragging about its proximity to the coast. strategysiladelphia' for luring jeff bezos? mr. mayor, we are glad to have you on. let's talk strategy. how long have you known? >> we just found out about it, along with everyone else. there are 100 cities vying for it. we will put our best foot forward. we have a lot of things to say. julia: how many people have you hired? how many people are working on this operation? >> right now, it is being handled through our commerce qpartment through a -privatelic

partnership. there are universities in and around philadelphia. our medical facilities are top-notch. we have an airport that is right downtown, close to the center of the city. we are halfway between new york and washington, d.c. we have a big millennial population, immigrant population. joe: just to be clear on the strategy, obviously, 50,000 jobs for one of the most successful companies in the world. does philadelphia have people working on this project full-time? >> we are all hands on deck, and they have been working on nothing but this. joe: one of the things amazon made clear is it is interested in tax breaks, and it wants to know specifically if you are able to offer tax breaks and how that will enmesh with state law. in your assessment, will

pennsylvania have to make any legal changes in order for you to offer the tax incentive that you think amazon will need? do not have specifics of tax incentives yet, and we do not believe there are any state laws that need to change. big of a deal and too many jobs and too great of a company for us not to go after. we have a lot of folks who could use the work, and we have a lot of i.t. startups and tech companies that have come into philadelphia recently. we think we are positioning ourselves to put a great case forward. scarlet: do you get a chance to pitch amazon directly? >> i've never been out west. hopefully, i can get out there. we will have the rfp completed by the end of october. everyone will submit. i imagine they will cut down to some shorter list and start interviewing. i'm not sure how they are going to handle it. julia: how about transport things in?

if you look at the flights between seattle and philadelphia, the likes of boston, new york, and washington, they all have more. are you going to do something to address that? >> it is a 20% cheaper cost of living in philadelphia. office rates are much lower than they are in all of those cities you mentioned. i do think we have the infrastructure, educational infrastructure, tech infrastructure, and the portability they would be attracted to. julia: if you need to add flights, would you do that in order to facilitate this? >> absolutely. >>we have space and capacity to do this. scarlet: amazon is an increasingly bigger payer -- player when it comes to public policy debates. we know the president is not a big fan of jeff bezos. >> neither am i. [laughter] let me re-say that. i'm not a fan of the president. we are not on the same page on many issues.

scarlet: we know amazon has been increasing its lobbying spend. how will its access to the capital play into your pitch? from are a half hour away washington, d.c. i'm sure he doesn't ride coach on amtrak. it's probably pretty easy for him to get up here and land in one of our private airport areas. joe: as you mentioned, the prize is so big, 50,000 jobs, complementing to the existing tech startup scene. from the big picture, what do you think about this new thing where companies can say, hey, cities, cut your regulations and taxes to the bone and do us?ever you can to woo would it be healthy if cities didn't have to out-compete each other? >> it would be healthy, but i think i.t. and technology has driven us in the direction. if you choose not to be a player, that is on you. we can't cut taxes to the bone.

there is a limit to what we are able to do, but we will put our best foot forward. julia: you have a lot of independent businesses that perhaps won't benefit. how do you sell the message to them? >> i don't see how you don't benefit. julia: is that what you say? >> it's the best internet website i've ever worked with. julia: we pay high taxes. you are giving them incentives. that is not fair. is that a fair question? >> it is, but 50,000 jobs is something that our city needs. julia: it needs the investment. >> that is where all the jobs are going to be coming from in the next 30-40 years. tech. our kids need a tech path. julia: is there any downside to this investment? >> there is always a downside, but i have not identified it as of yet. julia: interesting, philadelphia mayor jim kenney. ray dalio opens up to bloomberg

in an intimate conversation about his career in silence. he had some words of advice for president trump. >> when you ask what i would recommend the president of the united states to do, it is to try to deal with conflict well, to bring people together, to not make one side in a battle with the other side. julia: more insight from ray dalio, next. from new york, this is bloomberg. ♪

julia: ray dalio has advice for

president trump -- unify the country because america cannot withstand another economic downturn. fund is one of the few to make money during the last financial crisis, and that made founder ray dalio somewhat of a celebrity as policymakers came knocking. lio spoke to erik schatzker and gave him his thoughts on what america faces today. ray: the most important thing is to make sure that we understand what the country's principles .re to have meritocratic decision-making, to try to come up with the best collective decisions, to bring the country way.her in a meritocratic i think the period we are in

reminds me very much of 1937 if i were to pick an analogous period. after that time, it was after the financial crisis. they printed a lot of money. asset prices went up. interest rates went to zero. we had a large wealth gap, which created populism. analogous. the central bank begins to tighten monetary policy, and then we had a populism and a fall in the stock market. erik: we are once again at that precipice? cannot have the tightening of monetary policy that is material. we have a very large wealth gap, a very large gap. the top 2/10 of 1% of the lth equals theea

bottom 90% of the population's wealth, and it's not just wealth. there is a polarity. this is a time where we had both of those things. you can't have an economic downturn because socially and politically, we could not withstand an economic downturn. we would be at each other's throats. is a threat to our system. it is, in many ways, analogous, that tension. that is fearful to me. when you ask what i would recommend the president of the toted states to do is to try deal with conflict well, to bring people together, to not make one side in a battle with the other side and to try to have meritocratic ways to get to the best decisions. that is what i would recommend. julia: that was ray dalio, founder of bridgewater associates. up, bitcoin has rallied almost 20% off of last friday's lows.

how should institutional veterans go into investing in cryptocurrencies? this is bloomberg. ♪

joe: last week, jamie dimon slammed bitcoin for being a fraud amid growing interest on wall street in the cryptocurrency. how do investors who want to get into this space get in in a secure way? here is matthew gets, ceo at block tower capital. thank you for joining us. what is block tower capital? anthew: block tower is investment firm focused on digital currencies. big issues with

investing in this space is there is not an obvious, secure way to do it. we know about all of the exchanges that have been hacked, the traditional banks that hold assets. if someone puts money with your fund, how are they confident that the assets you buy will be held securely? >> it is a very important consideration for anyone doing ,nything in digital currency whether it's an endeavor -- an individual or investing institution. that, itr having done is not necessarily prudent to keep your selves exposed to whatever party is holding the coins. the infrastructure is really important, and to your point, it doesn't exist the way you want it to. are scarlet: launching this fund, but what is out there currently to give your prospective investors confidence

that their assets are secure? >> the only way to securely store assets today is to do it with cold storage, not connected to the internet, certainly not on any kind of exchange, but it is to physically remove the cryptocurrency or private keys from the internet altogether and keep them in an arrow-gap advice that will not touch the internet. joe: are there any sorts of third parties that can do audits of this thing to assure them that the coins you have put in cold storage are there? >> there are service providers, just like what you would see in other types of strategies or asset classes. auditing, fund administration. what doesn't exist is true third-party custody. as wes being worked on speak. another of groups -- a number of

groups are trying to offer third-party custody. joe: from your estimation, how close are we to that true third-party custody existing, and if that kernel were in place, what is your sense of the interest on wall street in putting money in that space? >> i think the interest is very real. waiting for the solution to be here. way of looking at custody and storing these assets. will seey, i think we a third-party custody solution within the next six months, and within the next year, there may be multiple that could check that box. joe: are these mostly new entrants into the space, or do you see interest in the traditional entities that provide this? entrants. it is new

as time goes on, we have had early discussions and a lot of people reach out to us from the names more people are familiar with. they want to explore this and understand it to themselves. the people you see diving in are the ones who have cryptographic expertise. maybe they built some of the hardware that people are using to secure digital currencies, and they want to extend that capability. joe: let's talk about the sec. the sec came out with kind of a warning to the industry, talking about a lot of these tokens. from your perspective, how do you make sure you are staying on the safe line? importantreally point. you are going to see it play out

in different ways. i think the sec is taking a more measured approach to apply regulation in a way that makes sense. ,t is very much needed particularly in the part of the market you are referring to. i think certain organizations are more exposed, the exchanges. say, thesewere to are securities, then an exchange would get in trouble for having unregistered securities on their platforms. there's a lot of focus in terms of which bitcoins should be offered to the public and making sure they should stay ahead of the sec. joe: if the exchanges were to have to diminish their ability to provide transactions, it

would likely hurt the value of .he assets sure that thee coins or tokens you invest in won't get harmed by an sec decision a week or a month or a year from now? >> we>> tend to be very plugged in in terms of what is being discussed on that front. investor,ive trading it could be an opportunity. for people who are more straight long in the asset class, all of a sudden, it becomes delisted. that is a real risk. blocktowero at capital, thank you very much for joining us. scarlet: it is now time for the bloomberg business flash, a look at some of the biggest business stories in the news right now. let's start with the department of justice. it opened a criminal investigation into whether top executives at equifax violated insider trading laws.

equifax announced this month that it found the breach on july 29. streaming set-top box provider roku plans to raise as much as to enter $19 million in its upcoming ipo. the company and stakeholders are marketing 15 million shares for $12 and $14 apiece. roku has not turned a profit since 2002. and apple are, gaining ground. honda, investing $273 million and adding 300 jobs at two ohio factories, as mass production of the flagship sedan gets underway. honda announced a 150 million tment. separate inves

84-year-old hosea bautista sore taken the reins at gbs, the brazilian meatpacking fcompany he founded years ago. he's only younger than two other bosses in the billing or club, including berkshire hathaway's warren buffett at 87 years old. that is your business flash update. julia: coming up, what you need to know to gear up for tomorrow's trading day. from new york, this is bloomberg. ♪

scarlet: "what'd you miss?" finishing at record highs. the s&p 500, dylan on some modest gains. joe: gains are gains. scarlet: plenty to watch for tomorrow.

more data, this time on u.s. housing. it starts at 8:30 eastern time. joe: i will be watching the u.n. 's general debate beginning around 9:00 a.m. eastern with president trump scheduled to speak alongside french president macron. secretary of state >> to learn is set to meet with his russian counterpart. julia: don't miss this. fedex, bed bath & beyond, and adobe, reporting earnings tomorrow. scarlet: we are going to be busy. julia: "bloomberg technology" is up next. joe: have a great evening. this is bloomberg.

emma: i am emma chandra and you are watching "bloomberg technology." he and therump says israeli prime minister are giving it a go in the middle

east peace process. both leaders are in new york for this week's u.n. general assembly meeting. prime minister netanyahu said israel's alliance with the u.s. has never been stronger than with the trump administration. is backtracking on his pledge to withdraw from the paris climate accord. officialstold conditions do not exist for the u.s. to stay in the deal. demonstrators marched again in st. louis as protests continue over a white officer's acquittal in killing a black suspect. they arrested more than 80 people. be interior secretary is recommending six of 27 national monuments under review b