dallas. president trump: your second amendment rights are under siege, but they will never ever be under siege as long as i'm your president. mark: the president did not elaborate how he believes the second amendment is under siege. the spanish prime minister has declared that "spanish democracy has defeated." he delivered a special statement to the country in reaction to the dismantling of the basque separatist group. he said it was not a time for television and that the first should be with the victims. earlier, he announced his government will continue to investigate and punish the crimes committed by them. hundreds of war veterans and civilians rallied in sarajevo today in support of bosnian muslim military commanders suspected of war crimes through the 1992 to 1995 conflict. last week, authorities briefly

detained 13 members of the bosnian army for alleged war crimes against hundreds of serb civilians in northwestern bosnia. many bosnian muslims view him and his men as defenders of the northwestern region that was under siege for much of that war. michigan environmental experts have warned that flint's water system had significant deficiencies weeks before officials ended a service providing residents with pre-bottled water. governor rick snyder and the service last month, citing two years of testing showing home -- 10 unresolved issues in a march 21 letter. 15 people died due to the city's water.inted global news 24 hours a day on air and talk on twitter powered by more than 2700 journalists and analysts in over 120

countries. i'm mark crumpton. this is bloomberg. ♪ julia: live from bloomberg world" is in new york, i'm julia casserley. we are 30 minutes from the close of trading. apples rise. the dollar sticks to four months highs. joe: the question is "what'd you miss?" scarlet: a rare occurrence where unemployment drops below 4% for the first time since 2000 related growth disappointed that way growth disappointed -- wage growth disappointed. favorites. the derby justified is an undefeated horse in the race that is favored to win the triple crown.

the odds and the stakes coming up. julia: "what'd you miss?" a mixed bag for the jobs report. payroll rebounding in april. the unemployment rate dipping below 4% for the first time since 2000. the decelerating wage gains perhaps overshadowing the celebration. tom, rbcs with more is chief u.s. economist. great to have you with us. what do you make of the numbers today? can we say there is pretty little sign of under-handing as far as the overall numbers concerned? tom: what you need to do with the earnings number is not look at that. you need to drill down a little bit more. we all look at the headline and i can see why you are disappointed. but if you look at production worker average hourly earnings, it is up 0.22%. our regular readers will probably laugh when i say this.

true.ays it because itlike does not do a good job of capturing weighted dynamic. what you need to do is look at ours as well. for you do that, you see production workers in particular, average weekly earnings was actually up a half percent. i need to be really clear on this point. this is just a reality. for the to get a sense economy wide paycheck. average weekly earnings is a better way to do that. when you look at those metrics, they were fine. i don't think much should be made of this decline on the soft outcome we saw in average hourly earnings. scarlet: does affect do anything with this data we got in today's report? or does the press what we saw from the eci more? tom: i think a lot of what i just said to you will be fully on the fed's radar screen.

80% ofion workers are the employment pie. they are an enormous number. that is the number that propels higher over the course of months. let's be clear. i don't think this number does anything to offend one way or the other. it does not force them to go left. williams, who was out a little earlier, he made a really great comment in this regard. he said that right now it is very consistent with what we think. and then he said and what i think is we are in a goldilocks backdrop. it is very consistent with the continuing to raise rates multiple more times this year. we think 4 in total. joe: is it possible we can to the headline of one of limited rates still drop significantly from here with the type of wage growth acceleration that would

cause the thread to actually ramp up its pace of hikes? say is definedld significance because seeing significant improvement from here will be difficult but the unemployment will continue to improve. from our perspective, it is easier to beat out to 3% unemployment rate. we can see it is lower than that. are you going to see what pressures on the back of that? yes. wage pressures will continue to build. that fullas been employment the summer between 4% and 4.5%. we started directing that you a little lower. full employment is probably between 3.5% and 4%. as a good to full employment, you'll see more weight pressure. i would temper expectations on this. we could usher in some about consumer inflation.

it is not what we think at all, but will consumption on a slightly better plane. joe: real quickly, you are dropping estimates of full employment, is there something you thought you got wrong about the macro backdrop before? or is it something affecting the reality of your we are? tom: in fairness, probably a little bit of both. onre was a bit more slack the sidelines than we had appreciated over the course of the last year or so. if you look at the people that are not in the labor force, particularly the cyclical not in the labor force, so the 25 to 40-year-olds, that continues to fall, and they are falling back in the labor force. pretty impressive and one of the things that has informed our thinking. julia: if i look at some of the other details, the underemployment rate fell. those are week for 27 weeks or longer, long-term unemployed fell also.

why do we get that wrong? why do we think these people are coming to the workforce perhaps where they have not before? tom: you can make the argument that some of the wage pressures we are seeing is driving that. , have said this before especially to folks at bloomberg. if you think about wages and wages for job leaders versus wages for jobs theyers -- sta yers, you get rewarded for leaving right now. that has been an impressive dynamic. leave jobs tend to stayers. you benefit broadly in a commonsensical way that you do not want to lose people that are there so they start the wage pressure. i think that cannot be discounted. julia: interesting. you pay to keep, not hire. tom: otherwise use them.

julia: thank you. scarlet: thank you so much for joining us today. coming up, the exit interview. matt that down with bill dudley as he prepares to pass the torch. we have highlights from that conversation, coming up. this is bloomberg. ♪

scarlet: "what'd you miss?" a bloomberg exclusive interview. bill dudley sat down with our own matt winkler as dudley prepares to leave the largest and most intellectual federal reserve bank. bill: i think the outlook over the next couple years is pretty good. economy is growing at above trim pace. business as you know seems to be in good shape financially.

the household sector is in good shape financially.household debt has been going quite slowly during this cycle. we saw today another good game in payroll employment so i would be surprised if the expansion were to end in the next year or two. there are some things i see over the longer term. one cloud is what will happen on trade policy. array going to continue with an open trade system, or are we going to have to raise trade barriers and get in a trade war? we go down the bad at, that would create quite a risk for the u.s. economy. the second thing is fiscal sustainability. the corporate tax reform probably was overdue. but this is a lot of fiscal stimulus late in the cycle, number one. number two, if you look at the fiscal deficit projections from the congressional budget office, there is abundant deficits of 4.5% gdp over the next decade. that means the ratio which is already high will keep climbing

so there are some real fiscal sustainability issues that may ultimately become quite relevant to the u.s. economic outlook down the road. matt: since you mentioned it, the stimulus otherwise known as a very big tax cut. william: there are two pieces. the tax cut an increase in the spending caps. matt: are you seeing any signs yet of major investment with companies? william: i think investment spending has been doing reasonably well. it has been going 6% plus each of the last two quarters. are we seeing signs of a television from that pace? not yet, but i would not expect to see that quite yet. it takes time for businesses to decide to increase investment. they have to actually have projects to invest in so i think the jury is out. right fit most to bar party confident that the tax legislation will encourage investment because it reduces the statutory corporate tax rates so corporations will have higher profits because of the lower corporate tax rate at least for the short term.

it also reduces the user cost of capital significantly because they have 100% expensing for new investments. it would be shocking if that is not lead to stronger investment. the question is how much? a couple percent stronger does not have huge applications for the growth rate of the economy, the potential growth rate over time. but if you get something more powerful than that, that has implications for how fast the economy can grow over the longer term. matt: the sponsors of the tax cut equated it with rocket fuel for companies, investing. william: well, we will see. my own view, you look at it historically, investment spending has really not been that sensitive to the cost of capital so i think there is definitely a positive effect on investor spending, but i would expect they will be more modest than large. so far, we have not seen signs of its elevation, but it is early. matt: something that you did

years, in the past six especially the last four years, was the fed came closest to meeting the inflation target of 2%. mean, people can say better looking than smart but the fact is you go back all the way to arthur burns as chairman of the fed, which is going back a long way. i think you are just beginning to think about being an economist at goldman sachs and i was just beginning to write stories for "the wall street journal" so that was a long time ago. what did the fed do the past four what did the fed do the past four years that made the difference? william: what is important and what -- in what the fed and is the financial crisis. they pulled out all the stops to keep the financial system from collapsing because we probably would have had a great depression. number two, post crisis as we

recovery, thee federal reserve to see a very sick monetary policy to try to get the economy back to full employment quickly rather than slowly. so the consequence of that, inflation and the amount of disinflation we had a new u.s. was less than in places like u.s. or japan. the lesson of the japanese experience when the japanese bubble burst is they did not respond forcefully enough in a timely enough way so what happened is inflation expectations gotten anchored to the downside and then they had a great difficulty pushing inflation back to the objective. i think we responded more aggressively. you mentioned the controversial quantity of easing programs. it also did forward guidance. i think those things were very helpful in keeping inflation expectations from falling a lot. that made it easier to get back to close to our 2% objective. i would not quite declare a victory yet. the inflation data goes up and down with a month, but we have made progress.

i have certainly happy where we are today. scarlet: that was our exclusive interview with bill dudley. julia: time now for the bloomberg business flash, a look at some of the biggest business stories in the news right now. kevin walker has been accused by federal prosecutors of conspiring -- by charging hidden fees. charged institutional clients commission's beyond what was disclosed or agreed-upon. the higher fees were beyond billions of dollars worth of trade. deutsche bank plans to close its office in houston, according to a person familiar. more than 60 people work there. is unclear how many will be offer jobs elsewhere. roughly 10000 and please working in the u.s. in coveragepulling on coal companies to help support the paris climate accord. it announced the strategy back in 2015 and said it will

completely eliminate coal exposure by 2040. world health organization data has shown toxic levels of air pollution killed an estimated 7 million people every year. the unemployment rate in the u.s. has not been this low since december of 2000. 1% jobless rate fell 2/10 of in april.employers added jobs. it was revised to 135,000. meanwhile, we gain unexpectedly slowed down -- wage ga unexpectedly slowed downin -- wage gain unexpectedly slowed down. the most on record following earnings. julie hyman is here with all the details. julie: pandora came out with a smaller loss than estimated so still losing money, but it is adding some new services in order to help at new

subscribers. it is not seeing the growth of spotify by any means, but still, it is gaining from a low base. it is also really interesting when you look at a picture of pandora versus tesla, although they have little in common, but here you have a ceo were analysts say this is a reason to have confidence in the company. roger lynch is the ceo. who took over last year, a former dish network executive. the new leadership team is executing communicating,, and restoring much-needed trust and credibility with investors by doing some of the things and playing catch-up anyway as well. joe: right. trust and credibility and all that stuff is good, but i am looking at 20 and they are not expected to be profitable then. is the business going to be a thing? julie: it is a good question. they are trying. if you look at bloomberg, you look at the paid and free subscribers. that is a big part of the issue.

paid subscribers are the little white bars.the free subscribers are the orange bars . that is because pandora was late to add on-demand services like you have with spotify, for example, or with amazon music, for example. now again they are trying to play catch-up, but it is a question of whether they will be able to do that. the big question before for pandora was whether they would run out of money. that seems to have abated for but acause sirius piece of the company and their shares are up today so that question has been put to rest. julia: there is an advertising story here. the matter what company were talking about with music, the dominance of apple and spotify how much room to maneuver these guys have got. julie: they just made an acquisition in that area that is expected to help boost advertising growth. that is something strategically that should help them as well.

also, the company has added something called premium access. it is not a paid subscriber, but it lets listeners access more features if they view a 15 second ad. other ways to try to get that revenue. scarlet: it has been a good week for pandora because these results and away the ceo handled himself versus spotify, the shares fell after the results did not dazzled too much. julie: exactly. the shares are also heavily shorted about 30% of its low. scarlet: important context. thank you so much.coming up , u.s. tech stocks are cheaper than europe for the first time in almost a year. what you can't miss, next. from new york, this is bloomberg. ♪

scarlet: "what'd you miss?" a weakness that we have seen in big cap tech stocks may be more

attractive, particularly on a relative basis soweto are looking at is the estimated price-earnings ratio of tech companies in the s&p 500 relative to the multiple tech companies in the euro stoxx 600. it is a ratio someone when the line goes up, u.s. tech stocks are more. as it goes down as it has been recently, u.s. tech stocks are cheaper. by this measure, u.s. tech stocks are the cheapest relative to their european peers in 11 months going back to june of 2017. we know they have been concerns about growth and negative headlines about data privacy and the threat of government regulation driving the negative sentiment, but the correction we have seen earlier this year has been thinking that they are priced in already and any kind of regulation would be a long way off. in the meantime, we have seen hacking away at the appeal and attractiveness of european stocks did not look like they were months ago. joe: i will say something really obnoxious.

i cannot even come up with the european tech stock in my head. i know the american ones and a lot of the big asian ones and i am blogging on what these are. scarlet: that is a good point. and a lot of people were saying europe could not partake it was not many big names. joe: i guess i am not alone. here is a chart data. one of my favorite relationships wasshares of caterpillar shares of emerging-market stocks. is go back -- this goes back to 19 and nine how the undulate together. remember days ago the caterpillar earnings global high watermark and all that stuff? that day was the day caterpillar . nfl and the day the emerging markets index fell. exact same peak on both so the relationship between the two has really helped and i think it is striking because we told the story about u.s. earnings and the global macro balance on favoring emerging markets.

the truth of the matter is they become one of the same story. julia: what happened to coupling? joe: exactly. julia: i want to dig into what we got as far as the data from payroll today and the average hourly earnings.unemployment now now u.s, people keep getting drawn off the sidelines and we are not seeing a week gains we anticipated. what i am looking at here is countries with higher labor costs as a proportion of their revenue. what we are seeing if you have a look at what is going on over the 2018 area, you can see those ith high stocks outperforming the low labo stock costs. would you not see that pick happening for the low-wage costs companies sooner than the high wage costs companies? joe: it is an interesting thing isn't it? julia: i am not sure on that. we will watch this. scarlet: all right.

let's take a look at market close. less than four minutes to go before the close. the dow up. s&p gaining 1.1%. nasdaq at 7200 even. this is bloomberg. ♪ mr. elliot, what's your wifi password?

wifi? wifi's ordinary. basic. do i look basic? nope! which is why i have xfinity xfi. it's super fast and you can control every device in the house. hey! let's basement. [ grunting ] and thanks to these xfi pods, the signal reaches down here too.

so sophie, i have an xfi password. and it's "daditude". simple. easy. awesome. xfinity. the future of awesome. ♪

julia: stocks run the week out in the green and tech stocks dominate during the session. i am julia chatterley. and if you are tuning in on twitter we welcome you to our closing bell coverage. scarlet: we begin with the market minutes with us stocks and the on a high note stocks gaining more than 1% and the s&p 500 has gained more than 1%. that quadrupled the number has in 2017 some volatility is back both to the upside and downside. the tech names are in focus here for the week and the nasdaq is up one and a quarter percent. we are going to talk more about the job support, but a

quick assessment after the initial selling. julia: and a breakdown of the sectors, it is quite interesting between cyclicals and defenses. providedalibaba expression of sales as the clouderce giant unleashed computing and whatever else it decides to invest in next. fluor,gest drop is taking a charge on the gas powered logic that caused a surprise first-quarter loss. burger jointte shake shack lifting shares to a three-year high and results surprising wall street. cheniere energy fighting frigid weather in asia and

strong demand from china. 3.9%,ple shares up hitting a record after warren buffett increased this investment in the company. millionssnbc he bought of shares of the company in the first quarter and the purchase $11 billionbetween and $40 billion, so apple is sitting pretty. joe: let's look at a government bond market starting with the two-year and the 10-year. to 2.50,ear yield up the expectation of the fed unchanged after yesterday. the 10 year yield unchanged. interesting even with the strong buying we see in risk assets, market is selling on the bond market. if you look at the intraday can see the initial reaction around 8:30 a.m., you see rates dropped

and then bounceback up. julia: that's like at what is going on as far as the dollar swiss and euro-dollar. we are seeing the euro and the swiss bank falling to a new 2018 lows during the session. we saw the bloomberg dollar index rising near a four-month 2018.raising losses in the dollaris strength we are talking about or the greenback having the strongest week so far this year. slowingconcerns about your growth and the pressure on swiss bank paying. i want to talk about emerging although optimism about the performance we have seen from emerging markets can look at the performance in the last five days. as you can see on the argentinian peso, the interest

rate is at 14%. that is not want to help with currency weakness cbi and inflation is above 25% in argentina. the award here is going to the philippine peso, the only one for the last five days to has managed to hold up against the u.s. dollar. you can see tough times in the last week for emerging markets. joe: finally let's look at the commodities. heree substantial buying with crude oil west texas a hair under $70 a barrel, continuing to gain. gold is also gaining, and if we it is atonger charts, multiple your highs and it will get a lot of attention if and when it crosses 70.

and a chart of lumber, this is extraordinary, number prices on an absolute terror and not good if you are building a house. those are today's market minutes. scarlet: we have breaking news. deutsche bank plans to move new york headquarters from wall street to midtown manhattan. the company that was leasing offices will relocate at the corner of 2021. reducing operations and united states. back then was under different leadership with different expansion plans. the cycle, ith spoke to influential voices on posted about market conditions at the angle vulcan conference in beverly hills. >> it is time to be cognizant of

the fact we have had a cycle that has run a longtime and the environment is changing, maybe normalizing. the cycle can run a number of years and feels correlated at the moment, and it can be disrupted in some shape or form. i think people need to be nimble and cautious but participate as an investor. >> you at other countries were , longhas been a good growth like australia. 10 years has had four drawdowns, and i think the market is going to be skittish as we get deeper into the cycle, regardless of whether we actually have a slowdown or not. >> it is more about people discussing the potential for a late psycho environment. i don't get the sense it is elected in the position so much and you can judge that pretty well because in a year that has

had as much volatility as 2018 already has, you are not seeing much in the way of the credit market widening or taking risk premiums. it is a steady as she goes performance. >> there is real confusion between risk and volatility, and they are not the same thing. most investors are long-term investors. for them, a little volatility is no bad thing. scarlet: is it good for them? >> it can be good for them in ways. >> when of the problems is the way they are measured is an historical waste not reflecting the market today. that is why my thinking is the interest rate increased this year could be one or more than the market expects, but not impossible to have 50 basis points. scarlet: joining us now to offer

his perspective is ben carlson, he joins us from grand rapids, michigan. the voices you just heard talking about mid to late psycho and how you proceed with caution cycle and how youle proceed with caution. we tackled this in one of your comments, if you sit out the market, how would you get cycleu proceed with caution. we tackled this in one of your comments, if you sit out the market, how would you get an? you point out three options, but for the market to fall further, or spread your risks. talk about what makes the most sense right now. historically, the lump sum is your best bet because the market was up most of the time something investment in the market that's the majority of the time. i did is i look at current foundation levels and use the

shiller ratio and look at historically when were at those levels. what i found is a wide range of return of the lump sum than dollar cost averaging over a period. you still went with the lump sum but you get a wider range of results in the higher probability of loss, so it depends on how you can psychologically do with these things. joe: it sounds like a risk tolerance question, if you can stomach a drawdown, the best move in any environment is to put the money wants to put the work and don't try to get too cute with timing. but when we are in an expensive area like the shiller ratio, that might make sense for your psychological health to be more judicious? ben: investing is a framework where everyone assumes them minute they put the money in the

itket, it is not the case, ends what you do psychologically to help yourself stick that night. for some people that might mean putting half in now and the rest in periodically over the next 24 months. it is about what you are going to regret less. julia: joe calls them important lines, but he is not sure what they are. is the price action around it, what can investors do as far as looking whether it is crossing or not crossing and determine how to invest around that? sand. prefer line in the the 200 day is a way to gauge situational awareness of the market. a lot of people think it is a buy or sell signal. when markets are in an uptrend and above the 200

day moving average, dare less volatility and have higher than average returns. when markets are below the 200 day, down more volatile and have lower than average returns. for investors is not necessarily a sell signal or light in the sand as traders believe, it is an idea that you can have situational awareness of what the market is doing and how their acting. itia: what do you do when divisions in the dominant sectors in terms of performance at the 20 day moving average? tech, look at financials below the 50 day moving average but about the 200 day, and then if i look at health care, it is below the 50 is below the 50 and below the 200. it is schizophrenic when the three most dominant sectors are going in different directions.

ben: schizophrenic is a good way to compare the stock market overall. the way to think about it is that when people lose money, all the behavior study shows losses from stress is bad, so i think as we get into these downtrends, people start to panic and that is why we see the exes volatility because people sort wits.se their maybe what these lines can tell areis that we know things going to be a little more volatile in the sectors we are seeing a downtrend. scarlet: should we be mindful of the important lines of influence action given so much equity trading is driven by computer algorithms? formulasnch and their and you will have orders to buy or sell based on the hundred day moving average regardless of whether people agree or not. ben: that is the chicken and the accurate, does it work because people follow it or the people follow it because it works? traders,.term market

it is not always going to work rossed the0 has c 200 day moving average and there has been many market corrections. yet to remember if you are going to use it to jump in and out of the market you're going to be paying a lot of insurance premiums for corrections that never happened. if the pay attention understand how to get the signal from the noise from these lines. joe: big picture the take away on how to step into the market is that stocks usually go up, and try to avoid making decisions that you quickly want to have to reverse on. ben: that is fair. if the market takes a dump and picks today than you can save it on the day will get you out of in time but it is not going to work every time. best line is investing is an exercise in regret minimization. julia: ben carlson, thank you for that.

job gains galore. that is next. this is bloomberg. ♪

in an address to the nra convention in dallas, president trump did they mention the deadly february shooting at marjorie stallman high school in florida. he reiterated his support for allowing paul to teachers to carry concealed weapons and having highly trained security guards in schools. the president said a good power that it willers is end in total failure.

it is gathering to and a suppers group after decades long campaign against spain that saw more than 850 people killed. civilians were taking part in the conference at the south of france and among those in attendance, gerry adams. >> the steps taken over the recent days and years is an example of what is possible when people of good will and determination and vision don't lose hope and don't give up. mark: spain's prime minister reiterated his government would continue to investigate and punish the crimes committed. russia says international chemicals inspectors finished" and the syrian town that was the sight of a suspected chemical attack last month. the organization for the

prohibition of chemical weapons is expected to issue a report in the team was delayed repeatedly in its attempts to reach the town. this rish academy says the nobel prize in literature not be awarded this year and the decision was made in stockholm today on the grounds that the body is a notion to pick a winner after a string of sex abuse allegations and financial crime scandals. the 2018 tries to begin the next year and is the first time since 1949 that the prestigious award is not the handed out. global news, 24 hours a day, on the air, and at tictoc on twitter. powered by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg. julia: there is always important nuances to the job support the cause for expert analysis and that is why we are a u.s. economics reporter to help break it down. give us the top line and the

earnings numbers and we will get into the nuances. >> it is an exciting report because we have a in implement rate below 4% for the first time since 2000, and part of the excitement for economy requires is there is no pickup in which will that help and was revised lower. the same debate we have been of theabout validity phillips curve will keep us entertained for a few more months here. participationout at nonemployment, we talked earlier about the other aspects involved in terms of details of this report and affect people are being pulled to the sidelines. matt: we had a drop of labor force participation in april and alongside that drop, earlier in the expansion when we had those kinds of declines in the implement rate, there was a lot of doubt cast on the validity because they perforce was falling. data today,at the labor force for this patient went down because employed

people were living the labor force as opposed to unemployed people, so the drop seems legit and what this chart shows you to increase and nonemployment was really focused in the 45 theyear-old age group, and 35-44-year-olds have the highest implement rate as this chart shows went to a new cycle low. the most people among the ages of 35 to 44 have jobs. enouthey haveo feel enough money to retire? matt: that is tough to answer and is inconclusive, it doesn't have the sense of these are people who are discouraged and giving up. it seems to lean in that direction and that is possible. julia: or not paid enough to stay? scarlet: let's talk about wage. if you look at average hourly earnings, that disappointed.

you are breaking it down and looking at hospitality and leisure and how the wage growth that has stalled out. matt: some of the big drivers of the decline in average hourly earnings enable work financial activities, health care, manufacturing. i want to highlight this leisure and hospitality sector because over the last year and a half, this is the major driver of the decrease. the blue light is the contribution to the headline hourly earnings, and from that sector, you can see it is rolling over. a year ago posted june meeting 59 basis points to headline hourly average growth, it is now 37. if we didn't have this decrease in which will in the restaurant sector, then wage growth on a headline basis might be 20 basis points higher. would have less hand reading about these low wages -- hand

wringing about these low rages. and wage growth is still higher in restaurants than other industries, but it is rolling over. this is a pro cyclical element of the labor market and we would most expect that kind of runaway wage inflation to show up at the low end, and it is not happening. i think it asked to the nuance of how we are going through some cycles within the cycle that are keeping things muted at a macro level. joe: your final chart shows there is maybe a phillips curve and wage growth is not out of line? this amber light shows you us employment to population ratio for 25-44-year-olds. the blue line shows the employment cost index which growth measure we got last week. you can see that is more in line with this increase in employment population ratio than that

headline average hourly earnings which is the red line. it is not far off. what we are looking at here is which growth is not as a surly so low as you would expect. continuing to create jobs at the pace we are, and we should expect continued gradual nothing in wages, but here to suggest we are at an inflection point and things are going to take off in a crazy way. it is phillips-ish, right? julia: thank you so much, as always. president trump delivered a convention,he nra talking guns, china, north korea, and robert mueller. >> convention, talking your second amendment rs are under siege, but they will

siege aser, be under long as i am your president. julia: for more let's begin alex wayne. is this the unofficial kickoff to the midterms? it seemed like a campaign speech today. alex: a lot of these speeches he makes two friendly groups so that campaign speeches to me. it is hard to tell when the kickoff for the campaign actually happens. it feels like the campaign never ended and we rolled into a new set of elections. he certainly has his mind on it. he implored nra members to go out and vote and insisted that they will when the midterms. polling suggests otherwise, so it is on his mind. scarlet: is there anything new you can update us on when it comes to what rudy giuliani told everyone if the president you about payments made by his

lawyer to stormy daniels and whether the president only be taken or not? there's massive confusion on this, i am not sure where things stand. can to read up for you, but i can't. richie giuliani released a statement today -- read giuliani took the car for what he said in last two days, and anything he said about the timing of the payment, was imprecise of the timing, but anything he said was his perception of events and not something that all caps has told him. it remains very unclear when the president actually knew that his attorney made his payment to stormy daniels, and it remains unclear why he we paid him in the form of what giuliani and trout are calling a retainer. scarlet: so his surrogates was freelancing the facts?

like donald trump and rudy giuliani could this up and giuliani went out and made these remarks to hannity and did subsequent interviews. everybodyrs put she didn't know about it until she heard it from hannity. says he's doing well with north korea and it seems they have a date and location with kim jong-un, what can you tell us? was going toht he announce the place and time, i was disappointed, he seems excited and eager to tell everybody about it but he didn't blurt it out at the speech. waiting for him to announce it. it seems the location is narrowed to two locations, the dmz or singapore. if i were to back, i would say

it is the dmz. you want blood it at that event, it will be prime out, - he won't blurt it it will be a prime time show. trump's own position of what is helping his poll numbers , i have no idea. thatng has crossed my desk honey west is helping president trump's poll numbers. stop. alex, make it [laughter] scarlet: coming up, canadian, officialsnd american come will they find common ground and what does it mean for trade negotiations with china? all of this coming up. this is bloomberg. ♪

delegation on a mission to negotiate trade in china is on its way home after two days of talks ended with little traction. president trump discussed the matter at joint base andrews before heading to dallas to address the nra convention. >> i have great respect for president xi. it is why we are being so nice and we have a great relationship. but we have to bring fairness into trade between the u.s. and china. mark: the delegation that included steven mnuchin and wilbur ross met with officials in beijing in an effort to

narrow the trade surplus with china by $200 billion over the next two years. president trump met with a team of advisers to discuss election security. the white house says the team that included jeff sessions, kirstjen nielsen, and christopher wray, which i find ways to protect elections from the line for an influence. was no significant winner in either of the two major parties after local elections held thursday in the u.k. results show the opposition labor party gain ground at some parts of the mission but was unable to keep parts of london. protesters used slingshots to bring that an israeli drone in near theemonstrations border entered week number six. thousands of palestinians swarmed the area with some burning tires and throwing stones at israeli soldiers fired like bullets and care gas.

-- teargas. drones are being flown across the border as part of a new tactic of getting dry wheatfields on the israeli side on fire. global news, 24 hours a day, on the air, and at tictoc on twitter. powered by more than 2,700 journalists and analysts in more than 120 countries. this is bloomberg. scarlet: that's we kept today's market action, the job report came down and unemployment is below 4%. job growth was slower than for a little bits and like investors do not how react and it was off to the races as stocks closing out the biggest advance in almost four weeks. for their week, only the nasdaq closed higher and the doubt and s&p still posting declines for the week. julia: robert lighthizer says he

wants to revamp the north american free trade agreement. nafta, he sets his a sense of urgency. he is scheduled to meet with his counterparts on monday and here is some insight if a deal will turn to reality. joining us this stefan selig. great to have you with us. i want to go back in time and talk about what we didn't see from the chinese negotiations and the fact that we have robert lighthizer and five individuals heading to china. which is unprecedented in these types of negotiations. trade how should negotiations we tackled with china and are you surprised by what did and didn't happen? he was absolutely

expected because these are big and complex problems. the take a lot of work to get done. and its a first meeting, is naive to expect some grand bargain to come out of this first meeting in beijing. joe: what i continue to be struck by from the president's perspective is a lot of focus on the trade deficit number and wanted to get that down. and you heard the more sophisticated critique of china's trade practices and it tends to be more about tech and the requirements of tech transfer. does the administration knew to be more clear about which of those is the priority? it is not only clear, but we're hearing different positions from different factions of the government. but focusing on the bilateral trade deficit with china makes absolutely no sense. governments cannot control the trade deficit, it is impacted by a host of things like demand and supply. as a result of that, all there

is an interesting political spotlight focusing on the trade deficit, that is not that could be addressed. scarlet: he has been consistent on that, more so than anything else, and yet the trade deficit in the bring that down. is there a way for the principles involved to come up with proposals to bring that in thed move past that get the nuances? probably not unless the u.s. was to save money, but what we can do is focus on what is important, access the markets on a fair level playing field. the theft and counterfeiting of our ids and host of other ideas around trade china has been loose about. here, what is important the underlying details and policy of a hundred billion dollar company deficit? stefan: and while we were there

was 200. julia: back to where we started with opposing views going in there, one person needs to deliver the message to facilitate discussion and negotiation? stefan: that is what i would do. negotiating by committee is awfully difficult. the senior person on the trip was the secretary of treasury, steven mnuchin. the president will hopefully invest in him the powers to be the voice on this topic. until we do that, it is going to be more difficult and not less. julia: what is the chinese response to what took place? arefact u.s. officials willing to go to beijing and have negotiations is better than throwing verbal bombs around.

the fact they are willing to go there -- stefan: the box will fly when they are back here, from the president. julia: does it feel like a step forward? stefan: the most effective way to make progress in these negotiations, especially with china come is to build relationships of trust and confidence. that is a good first step in doing that. scarlet: we should be the person among these five principles who is able to do that? stefan: that is the president's decision, but i have a view that steven mnuchin and larry kudlow have a view that is consistent with my own, which is not focusing on the trade deficit, and not be hawks on tariffs. that is ultimately the decision of the president. wonder if the goodwill is what trump was

trying to do, safety deserves a lot of credit, it seems like it is him trying to butter him up. stefan: he has been consistent in describing the relationship he has began to develop with president xi as a strong and positive one, and one that he describes as friends. julia: i want to circle back and finish where we began, the nafta talks. tose officials are moving on nafta to discuss that in particular. stefan: the u.s. trade representative come back from beijing will be meeting on monday with his mexican and canadian counterparts. they have a short window of two weeks to see if they can get something done, because of the mexican residential and congressional elections that come on july 1. orwill either make progress

it is likely to get pushed out to december or january of next year where there is likely to be a new mexican government. this getting nafta. facilitate negotiations as far as china's concern? areone thing out and capable of negotiation? stefan: i would think so, and if i am president of the instructor the trade representative to actually do what he needs to do to get a deal done. there are three poison pills about automobile, investor dispute mechanisms, and this sunset provision in terms of having parties get out of the agreement after roughly a five-year period, which is a sticking point for canadians and mexicans, until they are resolved will not make this on nafta. scarlet: there's talks of progress on nafta and we can expect something in the short term. that is a blueprint with china come up with will enable all parties to get past the verbal bomb dropping to get work done?

i think that is a very hopeful assessment in terms of where we are. i think it is 50-50 at best that we get an agreement in the near term. this point it feels like the convention of wisdom is more optimistic than that. when you look at the situation, what is it that you see? stefan: there are a number of very aggressive u.s. asks the are fundamentally going to be problematic for the mexicans and canadians. problematic for the u.s. as well. the representative is not a so hopefully our dealmaker in chief, the president, can urge them to be more constructive in conversations. julia: and doing nafta is the scott garrett that the top is

really talking about the chinese negotiations. nafta is less problematic than talking chinese negotiations. stefan: asking china to abandon the industrial policy is not so we have to figure out how we're going to commercially coexist with them going forward in a way that improves the landscape for u.s. companies and western companies that exist today. scarlet: they have to find a way to agree on the same page before getting to the details. selig, thank you so much. coming up next, women in the tech sector and how ibm is trying to woo them. next. this is bloomberg. ♪

is turning its attention to midcareer departures as part of a effort to increase diversity. bloomberg's ongoing position of diversity in the workforce, that ibm's vice president of talent and asked her what the companies tech we entry program. >> we have a long history in diversity and we have had go pay for equal work policies and on this commission and hiring policies for decades, while the for the rest of the world caught up to those policies. we are presently looking at what we need to do differently. what we're focused on now is real practical programs that get women into roles in technology. scarlet: can you give me an example? a woman who takes him

right to raise a family or other personal reasons. when women had their 30's, more than half stopped working. that we have 500,000 open technology roles in the united states, so there's a huge opportunity to attract women back into these roles in technology and doesn't have to be rocket science. one of our programs is taking the idea of an internship in providing women were returning to the workplace with a return ship opportunity to get back into the workplace and build their skills and get ready for a job in areas like quantum computing and blockchain. scarlet: is it people who worked at ibm before or someone in the outside who doesn't have a backup in tech? is for women when technology skills and careers and took a break and that break could be a couple of years or 20 years. scarlet: talk about how ibm leverages technology and artificial intelligence to turn

the tide and level the playing field for women? joanna: that is a great question, ai has a great opportunity to remove bias the hiring process and help both think differently about opportunities. watson can that assist, a solution that allows canada to explore job opportunities at ibm. what is it just thing is that because it uses a hat it will look at your resume if you choose to upload your resume or have a conversation with watson about your skills and interests and watson can suggest shops for you to apply to. what is interesting may suggest roles people don't traditionally think of our career paths that may be are under surged or underrepresented by women, as well as the hiring process. we use ai to help workers make less biased decisions and make sure they look objectively at skills. scarlet: what does this mean for ibm's bottom line? joanna: this is core to our dna

of inclusion and we're at a time where is more critical to the business. we need different mindsets and technology not just to make the products and services, but to ensure our technology is secure and to ensure we are training ai that is ethical and unbiased. talked about we earlier that sucks me interesting is that at one point when you are will be presented in technology but there's a record process that contributed to the shortage of women in technology. talk us through what happened and how that is being remedied. joanna: when the industry started there was an aptitude test that ibm developed and used and lead to 20,000 women programming. what happened in the 70's was a new test was introduced about by a psychologist who look at a group of 8000 programmers and only 15% were women. it was a biased group to start

with and associated personality attributes with being good in computer science. that is something we need to move away from and that is light at ibm we look at skills based on aptitude testing in terms of evaluating allthat is somethingo candidates. now is my interview with joanna daly of ibm and will talk diversity all day i've the bricks business of equality summit that takes place on may 8. julia: after the races, the kentucky derby is tomorrow and what they're a bit should try your luck with. this is bloomberg. ♪

scarlet: the most exciting two

minutes in sports, the kentucky derby is to mark and all eyes will be on for the hats and horses. here tots reporters provide anything we need to know about the triple crown and what you need to know is we could get another triple crown winner at just the out and wins this race. justified is the odds on right now and that could change -- thenext four hours next 24 hours, and this force is undefeated heading into this and the handicappers out there seemed to like justified as the favorite. scarlet: three to one odds. julia: and if you are slow to the gate, that is a problem. is 19 or 20 horses in this race, and if you are so out of the gate and there is 19 horses in front of you, that is a bigger amount of forces. joe: this is a key challenge of the kentucky derby.

erase with 19 horses, there's so much variability even if you think you have an edge. randomness will dominate. >> that is white handicappers like the 20 to one horse, is there so much randomness and horses that steadfast commitment to get ahead of the group you get away from the clutter in the beginning. likes tojulia says she bed at the horse races, i have never gone, but talk about the betting that takes place. the context of a larger national conversation if we legalize sports betting. >> horseracing is one of the few sports weekend that on from anywhere, and to go to the tracks mixed in with the panache and flair of the fans out there, there is a lot of gambling going on. the supreme court is considering a wider legalization of sports betting across the country, they are buying

up casinos right now and in acquisition mode. one of the big theories they are doing that is there is a big wolf of sports gambling revenue coming down at some point in the near future and they want to be a part of that. scarlet: will that help other places that host horse racing? the first place that is going to take betting in new jersey should new jersey when does from court case is the big horse racing track in new jersey. there's a lot of folks out there in the horse racing world that think that they have the infrastructure in place, the tellers and windows and the gambling savvy customers. they have been for such are already, and churchill downs, the biggest horse betting companies out there think they can capitalize quickly by using their infrastructure. julia: what to do when if you win the kentucky derby? >> a couple of million dollars, if your horse with you to pocket a couple of million and more

importantly pocket much more in stock fees in the future for that horse because suddenly you when a ton of marketing and advertising. the horse is cut and there's no more. scarlet: is that the case with justified? >> no. it's all business. i may bet on a few longshots. scarlet: which one? handicapper,nt likes the six to one horse, and another one, my boy jack, just 30 to one, and i like the name. julia: perfect for a friday afternoon. scarlet: you have to go with the names. julia: i am strategic and they go to the names as well. bettors, the other

that is their problem. [laughter] scarlet: thank you so much. it is time for the business flash and the biggest news right now. deutsche bank is moving from wall street to midtown. but just says the move is an investment in its market presence in the u.s. and a place will start moving in the third quarter of 2021 and budget bank as indicated is retreating from u.s. markets. best cbs and viacom merger could be getting closer after a concessionsrt that will be right in the deal and reston will drop or demand that the seal become the second in command as long as he sits on the board. coo tould set up the cbs oversee les moonves.

dubai's white city ventures and shareity landlord will the hotel for mesenteric group, unless the remaining owners exercise the right of first refusal. the acquisition is in relation for the hotel until next week's expiration. that is your business flash update. joe: coming up, but you need to know for the week ahead. this is bloomberg. ♪

week.. stocks in the coming up, nafta talks continue in washington. atcity are coming thursday 8:00. for what youit missed.

>> you're watching bloomberg technology. the nrat trump address

convention in dallas curated >> your second amendment rights are under siege. be under siege as long as on your president. says paymentsni to president trump's attorney michael:. a campaign donation. he also says mr. trump have the authority to fire at james comey. -- deral judge he suggested prosecutors to metaphor too get seeing against the president.