-- says the u.s. should appreciate its friends in the region because it "does not have many". trump, -- indent europe. what you spent on defense, many times more than and china. ex-president trump says nato treats america unfairly and he tweeted this morning that he should pay more for military shouldons in the u.s. pay less. the british prime minister treason may says she is looking forward to positive discussions with mr. trump when he vision -- visit the united kingdom. in the press conference in london, theresa may said there would be a lot of issues to talk out. >> yes, we will talk about trade issues. theme when we leave european union, we will be able to negotiate and sign trade deals for the rest of the world

which would then come into effect in december of 2020 and we are looking not just in the united states but to other parts of the world that we have expressed in the ttp. >> the prime minister and chancellor spoke ahead of which seeks summit to strengthen security cooperation and increase economic stability and encourage political collaboration between the european nations. the u.s. that area of state mike -- crownt with -- prince in the capital. he says the u.s. and its gulf arab allies want to show iran that is actions have "a real high cost". his oneetary stepped up is after iran threatened to disrupt the mideast oil supplies. global news 24 hours a day on air and on tick tock on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton, this is bloomberg.

♪ >> live from bloomberg world headquarters in new york, i am julie hyman. we are 30 minutes from the lows of trading in the u.s. and stocks are rising for a fourth straight session here the longest winning streak for the s&p 500 since the beginning of june. joe: the question is what did you miss. >> president trump touches down in brussels after his upcoming meeting of the easier than prime minister theresa may. he plans to build a plant in china with a radical -- a missing number in that agreement. the details are ahead. and curbing the power facebook, the communications unit joining a push to call for futures to break the tech giant. now for breaking news.

gladstone's global private the fund three years after $18 billion from investors for its last -- a spring in jason kelly on all things are evident at it. about theit say business cycle and the credit cycle? >> there seems to be a still hearty appetite for private equity and alternative vast. inckstone had the record 2007, that was just last year by apollo. 24.7 billion, we will see if blackstone tries to get more than that. is it the environment such that they can hit the number? is they can. one of the speculations is if they wait too long, a third of the current fund, they may be trying to seize a moment where they are still enthusiast rick

and may not do so in a year or two. >> where have they deployed the money? >> it is a global fund. one of the interesting things timing wise is they had changed near the top, the real estate guru became the president. very much in the ceo chair. firm.s a global estate whereal john has spent a lot of his time. there are still apparently a lot of deals to be done. >> i guess i'm asking, you said -- what is your pitch look like to new investors if you haven't even found the place for the money you just raised? >> keep in mind these funds tend

to take several years to a to play. usually 3-5 years is what you plan on. they want fresh capital. the global head of private equity, the guy who made his bones over in europe doing a lot of deals, you put together the marlin deal and others which really put him on the map. ,e has been aggressive in this a young guy looking to make his mark. the world we're living in right now, as actually given all of the opportunities not just in the u.s. although that seems to be in the market, but also latin america and elsewhere and in europe, there are still things -- we will see where they put the money. they -- it is not like the they will find a lack of appetite for this. >> breaking that record. one of our resident private at the gurus indeed. president trump tells nato to pay up.

two days of meetings begin for world leaders tomorrow in brussels at the summit is already looking contentious. donald trump reiterated he will get pressuring allies to defense spending up to 2% of gdp. only the u.s. and for other countries have managed to achieve that. we have a map of some of them. talking -- -- something the obama toinistration as well getting the european nations to start contributing more? flex nato it will saying it expects to dance budgets to increase in the coming months and years. they have domestic political issues but trump's constant hammering on this issue does

seem to be getting results. of trade and combining them to one. putting pressure on china over trade in the hopes of making a deal with north korea, or conflating the lack of nato spending with your's trade doesus, how uncomfortable that make the parties on the receiving end? is it that outrageous? is an this kind of what dealmaking is? to we have this demand and this demand? >> you are right. there are truths within the conflating of ideas. traditionally, administrations have never completed those two things here trade was want and defense was another. does not see the world that way. it is all a transaction. like he tweeted just before an hour ago. keep the farm goods out of your,

no deal. ifand furthermore, i imagine they did crank up defense spending, it would approve trade numbers. >> that is the point. when it to defense spending, three 16% so clearly above the 2% target, the u.k. 1% polling, a couple of country that have met or exceeded targets here. isn't the fact that u.s. or exceeding that target because united states is spending more on defense? that is something we are doing on our own regardless of nato. >> that is true. time, europe discounted by saying the total amount of defense spending in the eu exceeds that of china and its currently sees that of russia. they make the case there is no better ally than the europeans and they think that donald trump

does not truly appreciate that. we will see what the optics are when he actually starts the meetings later tomorrow. >> they are only talking for today's. is this going to be the big point of the discussion? they do have other issues they could get to. >> yes that there is contention in those issues. climate change among them. i think they will paper over their disagreements and i think donald trump will revel in being the center of attention and the european leaders are very interested in making sure donald trump sees them in a positive light. i would expect at the faces in the's -- lowering of the rhetoric. >> last year, there was an issue where the resident would not make explicit the u.s. endorsement, he just wouldn't do it. he did it later on at a press

conference in the u.s. will that be an issue once again or since he has made that commitment it is kind of put to interestingwill be to see if he has. i'm sure they would pose that russian. a more important things are what happened after -- what happens after nato. with that, the european allies want to know what his intentions are and whether he gets any answers is really the question. >> all right. thank you so much. ahead, a stint on staff. from new york, this is bloomberg. ♪

>> president trump nominated judge kavanagh to replace anthony kennedy. a former member of the d.c. circuit, kevin i worked for him on the clinton whitewater investigation. and we ask that we expect to see from the justice on the high court? stands in what i would like to give as constitutional law and modern the law. i begin with what they were saying, frankfurt, appointed by let's people to govern themselves in an the bill of rights very seriously. you will see an interpretation

of the bill of rights, not dredging, people were surprised being suchce scalia a robust defender of fourth amendment rights. but no, the government always wins. and seizures. the interpretation of that, a that will fit into that same kind of mode of someone who say democratic -- takes democratic promises versus the and it will be a fervent -- defender of individual rights. there is quite a bit of a track toon administrative loss, the extent to which independent agencies can or cannot do things. striking it down and say not sufficiently subject to that direction.

how important is this challenge being made to what some call the fourth ranch of government, not direct to the president way. request one of the big issues is accountability, power being exercise, and especially with the growth of the administrator the inning with a new deal, continuing almost with any -- without any interruption whatsoever with the development of independent agencies. people,ace of we the and the values, they want to the accountability in government. i think that is the theme we likely to see him the supreme court. when you talk about chief justice roberts talk about the commerce clause and taken too far, is there a growing majority, forget conservative and liberal, is there a growing majority for the notion that we need to get hard look at how far

they have gone? is anyn think there question. even justice kennedy who had embraced prince of difference to administrative agencies, began expressing concerns as time went on. i think it's will be a lively con station among justices and we will see in the case law, isis a trend in the 21st century. i thees being reversed courts, we are seeing it i believe more than the case during the age of justice white, i would like to use him -- i'm calling him the last new dealer. he went on in the 1960's under president kennedy and his view was that the agency is almost always right. briefly, given your experience with judge kavanagh, it is entirely possible we will have questions about the operation of power when it comes to investigating a

president we have investigations right now of president trump involving so-called russian collusion and russians of illusion. do you enter the that there would be issues coming out of that investigation that would rise to the supreme court, do you question executive prerogative? >> it is speculative at this point but i see the possibility if there is a confrontation and the insurance -- insurance to the president of a major separations officers issues, can an within the branch actually subpoena a president of the united states? it is an unresolved question. >> that would date -- that was david westin with the former member of the d.c. circuit. it is time for the bloomberg this new/, some of the biggest business stories in the news right now. thanlled on king saw more half $1 million in outflows. the worst performance among its

peers in the area. the outflows dragged assets down to 1.48 billion dollars. u.k. regulators will give their final ruling on 20 for centuries on thursday. the decision is expected to trigger a bidding war with tom f comcast for britain's top pay-tv company. their secretary appointed yesterday agreed to speak to plans announced imminently. they learned fox's waiting for that decision before raising comcast's $29ter billion offer for sky. apple's going old school. to boost iphone sales in india. the second design in california assembled in indian models and are arriving at doors in the world as his fastest smartphone market. is $375hat the model and it will help build -- build brand loyalty and slowly out of reach for a majority.

the coveted book margin of safety reportedly no longer available on kindle. advertised for $2500 apiece selling on amazon. comp published without his approval and the margin of safety in the investment world. that is your bloomberg business flash. a lot of tweeting, we were very excited about this. >> interesting that you need to get that out there. request looking on ebay, $14.59 for a copy. you can get a photocopy version for $189. all right. coming up, pepsico reported

strong profits earlier today. having the company look to fix the sugar slot next. this is bloomberg. ♪

>> pepsico climbing today after reporting a strong debt strong earnings. $.70 per share. bloomberg intelligence senior analyst can joins us with more. the salty snacks this this, not to the north american average business, to seeing something failed. getting at this, talk us through the salty snacks is this and where the group is. is it limited to the u.s. or is it global?

>> you are right, the numbers pepsico put up today were geturaging to investors who accustomed to their week results in the consumer staples area. pepsico is fortunate to have a brand like frito-lay which --sistently has volume sales snack brands globally are doing well. one of the encouraging signs in that was the emerging markets had a real improvement, mexico are allern europe clicking right now. so, while there were positives overall, ies, but think you can find -- good reason to be optimistic about that report. >> a chart look operating margins for the two business is, it is frightening. the operating margin is twice that of the severance margin.

this is kind of a beverage snack differential? not, it is referential. that is probably not going to converge anytime soon. fredia -- frito-lay has a large dominant market share and same in the u.s., a deep percent share. and they pricing power are the big unit in that category and can do a lot. they have a cozy relationship with retailers thanks to their directdentedly strong store delivery system which gives premium shelf space and on and on here at a well-run business with a few -- with few competitors at the moment. in atlanta,company coca-cola, to deal with. cola, butto beverage also, and increasing array of beverage product that coca-cola is expanding into. price xnot have as much

ability. they have a tougher go of it to make gains. reading through the conference call and the first question was a big and sprawling question about the fate of the consumer packaged goods companies, and all of the challenges they face particularly from startup brands and different distribution models, shelf space, but honestly the equation changes when people can buy online, people can be really negative about all of these companies this year. save the not look so safe. do the results show that they be some of those concerns are overdone and that for the industry overall, perhaps, that the business models are more sound than people thought #>> that is a good question. i think today's's report told investors don't count sumer brands out yet. you are right that it is well done and -- well documented -- food retailerd, a

environment putting under pressure on these packaged food companies in particular what do they do about it? they need to reinvest in e-commerce where the consumers are going. they need to reinvest in digital arketing capabilities to have more engaging relationship with their brands in the consumer. that is what they are doing and pepsico made a good case today. they are reinvesting largely a and saying things into these initiatives. that is what you want to do. if you are a long-term investor, that is what you want to do. again, what they said is between a lot of information -- innovation, the veggie and fruit others, they, and are still a formal competitor here. >> all right. thank you for your perspective.

the market closes next and we're looking for gains for the three major index is for the u.s. stock, marking the fourth straight day of advances. the nasdaq barely hanging in there and we will see if it closes in the green. this is bloomberg. ♪

scarlet: "what'd you miss?"

france wins. second quarter earnings kick off in earnest. >> i'm julie hyman. scarlet: i'm scarlet fu. joe: and i'm joe weisenthal. welcome to the closing bell coverage. julia: we have our market minutes but i want to mention france has bested belgium. we have live pictures here. that looks to be paris. people are celebrating. we will have britain facing off with croatia tomorrow in the second portion of the semifinals. scarlet: the final match will be on sunday at 11 a.m. eastern time. france versus england or croatia. we will a no -- we will let you know. julie: look like a fun place to be there.

let's get back to the u.s. stock market and talk about the session that was today. we saw the nasdaq and the red for much of the day before finally turning cognitive in the last hour or so. the s&p 500 and dow are rising for the fourth straight session. here between trade rhetoric and the beginning of earnings season. you're the president in brussels beginning the two days of nato talks. in terms of some of the movers that we are watching here during the session, we talked about pepsi. we're also watching quest diagnostics. qwest was estimated to outperform isi. stocks continued to be a safe haven sector with less exposure to political risk. the exception is certain or -- cerner. we saw them underperform at ever court isi. there are concerns that the

financial impact shifts to the cloud and there is compelled to that potential competitive threat from backbenchers -- back vendors, excuse me. we were talking about how are preferringrs salty sweet than beverages. joe: let's take a look at the bond market in u.s.. it is a mild day. short-term rates inch backup. two year yield is 2.58%. 10-year is up. a little bit of flattening a little there. turkish assets are getting clobbered this time yesterday when we got news around the new president appointing his son-in-law to a prominent role running the economy. that freak out investors. you can see it there. a big selloff in bonds. the five-year yield shooting up 41 basis points. scarlet: let's take a look at currencies. yet his weaker versus all of the

other currencies. they fall to a seven-week low versus the dollar. you can see the euro, yen, approaching 131. joe mentioned the turkish lira and how they are getting clobbered. today, it ist it settling down a little bit. consolidating after this late plunge. that is the big spike up around midway through the screen because that was right around the time erdogan revealed his cabinet. if you look at how the lira has been trading, it is holding and lost him with 25% over the past year. that is appreciation versus the lira. tokey central bank shifts consider market concerns, and perhaps leads for more losses in the lira, the central bank may lead themselves -- leave themselves with no other options

whether tupelo's -- whether to impose capital. joe: let's look at the commodities. not a ton of action. ande oil is inching up texas is up. gold basically flattened. was generics and it has been getting slammed. really since early february. you see nonstop plunging and part of it is the trade war perhaps, part of it is perhaps china with some of the spare capacity in steel plants and cleaning up pollution. think is turning into the big commodity loser this year. those are today's market minutes. scarlet: "what'd you miss?" chung.ring in dan dan, great to see you. we were talking about pepsi and julie observed if you go on the ,u rp function of the bloomberg

they had the best one-day reaction to earnings. julie: reporting its first quarter of 2007, it happened in february 2008. scarlet: it has been a long time is the nice way of putting it. the earnings beat was better than what analysts and investors had anticipated. how much of this will be a preview of what we might look for in the second quarter earnings season? dan: that's a good question. terrific quarter was read 24% earnings and a most 80% of companies beat numbers one of the strongest performances on see morethink we will of a bang in the second quarter. pepsi is a little bit of a unique situation and a staple within not performing very well. they are beating a low hurdle. scarlet: does this cause a

re-rating of the sector? dan: i don't think so. the stabilizer struggling with overvaluing in the chase for dividend yield. many of them were trading at 22 plus. now they are reasonably valued around 16 times, some 17 times. but that is still pretty expensive for businesses that are struggling with growth and use dividend yields are no longer attractive because of rising rates. joe: we are three days into the trade war, and i think the stock markets ended up every day so did not knowwe this was coming, but it is hard to figure out what effect this had on the markets. even though we have said markets have sold off on trade war's. do you see it as a tradable theme or investable theme in one direction or another? dan: we're 50 analysts ata who track every market in the world

-- 50 analysts at alger who track every market in the world. there are going to be very specific effects with the trade war tariffs rita by and large, no effects so far. julie: why not though? dan: part of it is that the growth drivers for a particular u.s. economy are really companies that are intellectual property, significant advantages in terms of marketing more brands. the commodity component, which is so often the subject of trade war's, or even the commodity like products that are the subject, it is not really what is driving our economy today. then, there are other aspects. scarlet: as president trump right when he's a trade wars are right -- are easy to win? our economy is geared to

benefiting from trade war. dan: i think the perspective that we are looking at it from is simply with the respect to china in particular, china has grown in the last 20 years from a country that was not participating in global trade to a powerhouse. it is appropriate to look at the trade relationship and terms of trade if you will. our europeanand allies are in agreement with us, intellectual property protection, access to chinese markets, the structure where you had to have a joint sector that was global, these are things that are anti-competitive in not fair. joe: you mentioned the tech theynies, big leaders would not think of them as potentially facing trade war rhetoric, they have outperformed everyone despite stumbles, can i continue? dan: china's trade barriers blocks google.

facebook is not operating in china. scarlet: so no risk their. dan: netflix is not operating in china. these are the best performers of the year for multiple years. not much risk. people drawingf spotlight to evaluation and other risks of disbelief that their ability to be the market can continue quarter after quarter at the rate it has been. a huge question that every investor has to get right can they -- right, can they? dan: when you look at some of the big tech leaders, you are seeing some companies that have grasps across many areas of influential technology sectors. google for example, they are the android operating system and club leader, as well as in waymo they have one of the most

automated driving technologies. then a whole host of other technologies around that company. i don't think it is expensive at 20 times the because they are growing rapidly. havether tech companies various valuations around them but we see them as continuing to grow and innovate. we like the position they have. julie: just a dig into this a is somethingthis mike wilson highlighted recently. not just the s&p index by itself, but the premium to its s&p 500. you're looking at a pretty wide gap here. the widest since 2010. you like tech, notwithstanding valuation and you don't think it is worth it at these levels. is that the group you are focusing on the most right now even amidst all of this trade

back and forth? is that group going to be more insulated from all of that as well? one.2010 is an odd our theory around a lot of the valuations are growth stock is that it is not that they are expensive today, they got extremely cheap after the financial crisis and remain so for many years. more, they're definitely in line with what we called their historical valuation. we were pointing out too many investors well over a year-and-a-half ago that the most expensive groups on the market where the defensive ones like staples utilities, and that tech and health care and consumer were the cheapest. partially because of the after affects psychologically on the crisis. today they are not as cheap, but overall, i think they are fairly valuable for they are. scarlet: they can so much for joining us. tesla chooses a road less

traveled and we have the major move from them overseas. from new york, this is bloomberg. ♪

>> i mark crumpton with first word news. president trump has arrived in brussels. this morning, the president continues his criticism of the alliance tweeting that other member nations don't pay enough in nato. ,n a tweet from air force one president trump may demand the nations reimburse the united states. the supreme court nomination made rounds on capitol hill holding sessions to get acquainted with senators who will have the final say on his confirmation. the political battle lines were

drawn. democrats are promising fierce opposition while republicans are calling judge kavanagh qualified. today, some called judge kavanagh among the most distinguished, influential judges in the entire country. >> the supreme court has adopted his positions, the positions that his noted less than 11 times. multiplethored dissents that prevailed in the supreme court. >> the trump administration is moving forward with its plan to lift restrictions on u.s.: omissions that were established under president obama. it has sent aoday new rule for the white house to review. the agency says the limits put in place under the previous

administration exceeded federal law by setting emission standards the power plants could not reasonably meet. in thailand, all told members of a boy soccer team and their coach are out of the cave where they have been trapped for more than two weeks. the leader of the rescue operation said a medic and three navy seals stayed with the boys and they are out of the cave as well. the international soccer has invited a team to attend the world cup final this week. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i mark crumpton -- i'm mark crumpton, this is bloomberg. julie: from silicon valley to shanghai, tesla is moving overseas. the tech giant signed up a luminary agreement rivaling its

current u.s. production. the chinese plant will have a 500,000 car capacity per year eventually. joining us by phone is head of the global technology research team. he is a bull on the stock. i believe he has a $530 price target on it. arere, i'm guessing you pretty confident they can get to 500,000. madewas a promise they from the california factory but they are far from the goal. >> absolutely. give me a timeline, i'm confident we will eventually get to 500,000. >> how eventually? >> that is the question. this morning, the timeline was to were three years. that as an aggressive timeline. you know how elon musk likes to set very aggressive timelines so i think if we bet on three or

four a year instead of two or three years, we are probably safe to ramp up. remember. it is not going to be a ramp-up to read is not going to be from zero to 500,000. we can probably be doing a quarter of a million units and anothernd phase, quarter of a million. in a couple of years we can expect the first quarter of a million. joe: let's talk about the domestic situation of tesla's production. they recently hit the target of month.cars in a we saw stock selloff about the sustainability. where to uss them right now in terms of the domestic production goals? the big question is, fundraising. will they need to do more this year? pierre: absolutely. production first, they have been able to produce more than 5000 models and one week.

the numbers on the back of that building up like an additional production line in the backing. that is impressive. that means these first 5000 units will need time to get consolidated. with 5000 units you can bet on it every week. in terms of ramping over the last two quarters, what you see is that the big production the end of the quarter tends to be the average production of the next quarter. the rule of thumb for me would be if, in the third quarter, they produce in the region of 5000 cars a week, that would be a great success. that would be an additional step towards full production. that is what will make me feel very comfortable with how much progress they are making.

expecting them to be ready at 5000 every week right now and increasing production from that level will be optimistic. in terms of fundraising, if you atk at the math of tesla, 5000 cars a week for the whole carter, they will breakeven in terms of cash flow. that means they can run the business and continue to invest in the growth of the business with a 750 million cap expected the quarter -- in the quarter. that's why i'm saying we don't need to raise money. there are two things you need to add to it. the first is the margin of safety. tesla has $2.7 billion on that. that's more than $1 billion is going more quickly. it is very limited room.

there could be willingness to increase the buffer. the other thing is that the model three today, you cannot evaluate the release agreement. you have to pay up front for it. that is going to limit tesla's ability to expand. having a stronger balance sheet puthe future in order to that on the model three is something management will consider. to run the business, you don't need to run cash that she don't need to have cash -- you don't need to have cash. additional cash would be welcome. scarlet: not a necessity but could provide cushion. thank you so much, news street research pierre ferragu. beforead gained 2.9% paring some of the advance enclosing 1.25%.

i exclusive interview with jack lew and why he says trade concerns are a huge concern for the u.s. investors. this is bloomberg. ♪

scarlet: "what'd you miss?" the trade war is getting started and it is too soon to tell how it can affect the economy. jack lew is worried and he spoke with david england in hong kong. >> i think the tension over trade is a matter of great concern. challenges facing the u.s. economy are not principal -- principally coming from trade. a lot of the issues from the trade war are going to hurt the u.s. economy and take the steel

and aluminum. tariffs that will hurt car manufacturers, aluminum can manufacturers, it will drive up prices in the united states. the tit-for-tat will close u.s. exports. the combination of higher prices in the u.s. into exports is not a good thing in the economy. this comes at a time in the u.s. economy where the federal reserve is looking at how far to move and how fast to move on interest rates. a lot of implications of the trade war are going to result in higher prices. perhaps they need to do it faster, perhaps they need to move farther. at the same time, the trade war sends a very confusing set of signals. that when interesting the meeting came out, they will be careful not to attribute any policy they make to a specific

fiscal policy or trade policy. but, they have to look at the data and what the macro economic applications are. seenen if these things are -- there's a part of the market positive?it as a what you view as the principal u.s. concerns with china. i don't think the trade deficit alone is a concern. is, arethe concern there markets open to u.s. exports, orchids open to u.s. investment in china? are they protecting intellectual property or demanding that companies handover intellectual property in order to do business with china? those are the kinds of structural issues that should be the subject of bilateral discussions. i think this trade war is a distraction in many ways. clearly there are distractions in the u.s. china relations.

with my chinese counterpart, we made progress. we've been made progress on steel and aluminum. there was an agreement to have a g20 process that china was process -- part of two monitor the capacity. julie: that was our interview with former u.s. treasury secretary, jack lew. pushing toward a breakup, the freedom from facebook coalition gains a new member and his effort to split up mark zuckerberg's empire. this is bloomberg. ♪

>> i'm mark crumpton with first word news. a san diego judge said he will not extend the deadline to impose for the united states to reunite families forcibly separated -. 138 of the children under the age of five were said to be returned ahead of today's deadline. the judge said all of the nearly 3000 separated children must be returned by july 26. terror may welcome cabinet to downing street as she tried to restore government unity following three resignations over brexit

including two from her top ministers. they replaced outgoing foreign hot whoies with jeremy offered supportive words for his boss. time ofincipal job at a massive important for our -- standas to strand by the prime minister so we can get to an agreement with the european union based in what was brought to the cabinet last week. part of that is a strong, confident, global britain. >> he also thanked his predecessor for his service to the united kingdom calling boris johnson one of the great driving forces in british politics. cuba will end it 16 month freeze on either restaurants and bed-and-breakfast in december. that is when the country's communist government implements new regulations to prevent tax evasion and the accumulation of wealth. cuban officials said the private

sector has become a necessary sector of the economy and it required higher controls. the nfl players association today filed a grievance with the league challenging its national anthem policy. the rule allows players to protest during the anthem by staying in the locker room, but for them from sitting were taking in the if they are on the field or taking the sidelines. is inconsistent with the collective bargaining agreement and infringes on player's writes. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton, this is bloomberg. scarlet: let's get a recap of today's market reaction. stocks arising for the fourth straight day and earnings was a catalyst. pepsi was up more than 4% after reporting profit.

its bottom line number for the previous quarter was coming in ahead of expectations. banks declined before jpmorgan citigroup's gave their results -- are going to give the results on friday. julie: "what'd you miss?" a growing push for facebook .reakup newest memberthe of the facebook -- freedom from facebook collision. josh idol joins us from san francisco with the story. josh, i have never heard of the freedom from facebook coalition. i mention the fact that it is getting this big supporter in the union could be good news for its efforts here. >> that's right. if you had been at their shareholder meeting this summer

and looked up into the sky, you would have seen a banner being can are -- carried in the sky to promote the new coalition. moveon.org,s like but have in the communications workers of america join is the big deal for them. they are an important player within organized labor. it is an influential voice in the democratic party and among progressives. union to largest endorse bernie sanders in the 2016 presidential oleracea -- presidential race. they say facebook should be broken up and is a monopoly, and that is the latest sign that the company is under a type of scrutiny that it has not been in the past. joe: why did the communication workers care about facebook one way or another? josh: a cynic might point out they represent 100,000 people working at at&t, and at&t and facebook have been at its on

issues like net neutrality. cwa has confronted facebook and other ways including losing -- moving a lawsuit saying facebook's platform is discriminating against older people in job placement. cwa is suing an estimated class of hundreds of employers, employment agencies saying the app is being used to excluded older people from finding out about jobs. they say facebook is having a huge effect on all kinds of aspects of members lives in the huge effect in our economy, not that it is just the social media network, but that it is a place members ared particularly concerned about the privacy. joe: some people say the facebook needs to be broken up or these tech giants need to be broken up argued we need to

reconceptualize antitrust policy. the traditional policy about a monopoly coming in has been raising prices on everyone, it does not quite work with tack. we need to update the model to account for their power in different ways. does the freedom from facebook coalition also make this argument or do you think -- do they think the current framework laws suffice? josh: i don't think anyone is entirely satisfied with this framework, whether people think it is too permissive or restrictive. certainly there are people criticizing facebook and pushing for more regulation of facebook. they would take and tumor -- consumer -- they would say consumer welfare standards don't go far enough. they offer their service for free and people like it, so there is no reason for them to become out this way. scarlet: that has been the response up until now with the

cwa joining this movement. how does that change how facebook strategizes going forward or present its case to the ftc? josh: facebook did not comment on this particular development, but they will have lots of opportunity as they are planning months of hearings on these issues. mark zuckerberg has had to congress that he does not feel like a monopoly. that his perception is constant competitive pressure on facebook and we will be hearing much more about that from facebook. julie: josh, you cover unions, are any of facebook's employees unionized? yes and no. among itstself, direct employees, is nonunion. however, there has been pressure, successfully brought by activists in the past few

years on facebook regarding the conditions of subcontracted workers, the people who drive the shuttle, serve the food in the cafeterias. following pressure and media facebook has conducted itself on those issues in a way that have drawn praise from unions and organize labor folks here in the bay area. facebook, when people try to organize among the service workers who are providing service while being employed by contractor companies has approached the issue in ways that have ultimately drawn toise in terms of agreeing pay to add costs for example, or saying it will not punish the contractor company if those workers unionize. scarlet: interesting. josh adelson from san francisco, thank you so much. josh: thank you. scarlet: plans for mexico might

be frustrated on the same issue that is troubling president trump, migrants. joe: get involved in the conversation, go on twitter, send me a tweet. this is my handle. shoot me a message. what you want to know from the guests we are talking about? let me know. this is bloomberg. ♪

scarlet: "what'd you miss?" and low has said he refuses to do the dirty work of the united states. mexico faces a pretty tough situation. in the latin study for

the foreign communications -- foreign relations. there's a lot to tackle whether it is negotiating with the budget finance team, restart nafta negotiations, how high does dealing with migrants from central america rank on the to-do list and where should it be on his to do list? >> it is not rank high on what he needs -- wants to do. it wants to help poor farmers, and he has a huge domestic agenda. what may happen is migrants become a huge issue on his agenda. this is not what trump wanted to do, but this is what he and the congress want to deal with -- have to deal with. joe: is this a big issue in terms of the voting public in mexico? >> it is not a big issue yet. for the last several years, mexico has been stopping between 100 and 150,000 central

americans from traversing mexico and many coming to the united states. if all of a sudden, those people came into mexico, but they were stopped in north america, you can imagine people trying to find a place in mexico and that would be an incredibly important domestic issue. julie: how much has mexico and the united states been working on the issues, the trouble spots in central america at their source? the source of migration. this is something the u.s. had had. efforts on in the past where are we now? shannon: here in the united states, we have been doing this for the last few years since we saw this border crisis in 2014. 600pend somewhere between and $700 million here to deal with some of these root causes. it is not enough money and there are a lot of challenges. mexico has been working with central america and the u.s. in

this issue. it is a huge source of problems and we will not see it disappear anytime soon. we want to migrants from any country disappear anytime soon. scarlet: a lot of the talk during the u.s. presidential campaign was migrants from mexico. itsident trump talks about for instance. as you point out in your column, mexico has come from a sending nation to receiving nation. they are getting migrants from central america. one of the tools at their disposal to manage the inflows? how's it dealing with it now? shannon: mexico has very expensive laws on the books. if you are a migrant coming in trying to seek asylum, you have the right to a lawyer, process, appeal. in reality, mexico is not doing much of that or any of that. they have a very few offices for migrants to go to to seek asylum. they have a backup system and have a lot of abuses of migrants

within the system. president of mexico really wants to be more humanitarian, a lot of resources will have to be poured into the system. joe: is there a way in which anlo's prices could go with donald trump's and they would have a better relationship? shannon: both of them will face this migration crisis. the question is, will they docked tail or choose different directions. is that he will be more humanitarian and open up and not separate kids from their parents at the border. we will see what happens when reality hits. julie: his rhetoric has also been quite anti-trump, has it not? is set to meet with mike pompeo and will be visiting the u.s.. he is said to speak about nafta, regional development, and regional -- the regional side is not yet talked about.

shannon: mexico once a good relationship with united states. trump has had nice tweets in terms of congratulating him. the question will be when they get together. trump is not popular in mexico. he needs to play and amlo is to play to his basis. scarlet: how much is a pragmatist, amlo? shannon: that's what people want to know. will he for fillies promises or be a pragmatist. i think there will be lots of areas what he will be pragmatic. one will be with united states and maybe migrants. scarlet: we will see how this plays out. o'neill, she is a frequent contributor to bloomberg opinion, thank you. reach all the

work from the terminal. julie: i did not know that. scarlet: how buyers are working the manhattan real estate market. from new york, this is bloomberg. ♪

julie: "what'd you miss?" manhattan home buyers are reveling in growing inventory. more than half of the sales went for lasting -- lower than the asking price. this has been brewing for three or four quarters. the finishing touch was the uncertainty overlay caused by becauseral tax law

there will be ramifications over the next year as people are limited in terms of how much they can do duct with a $10,000 cap on property taxes. reason --high text region, that will pose a challenge. the slowdown represents buyers and sellers doing this recalibration of what value actually is without a lot of information to go on. >> with talk to people and friends who have suffered the loss of the deductions. you have a lot of inventory, how long does it take to work out? now is thate seeing we are seeing new develpent -- development inventory. 80% of the transactions is the highest level of inventory we have had. we have had eight years for second quarter. what that will do is soften

prices as you move forward. >> which is why you get the previous apartment at the biggest discount while the asking price is otherwise. >> yes. >> talk about media prices and yarder freeze, where are the hotspots -- median prices and where are the hotspots? hotspots, i would not say there are hotspots. -- inmore in terms of terms of geography, it is more price points. this is a margaret for several years -- market that has been softer at the top and tighter as you move into the market areas with a lot of smaller units. it is still tight. 9% of the transactions market wide in york or manhattan sold over less price. that is a far cry from 2015 when it was 31% of sales selling

above less pricing. there is still some tightness, but it is more located toward the lower starter market. >> where you find the best bargains? [laughter] the biggest discounts are not the hotspots, where do we go? >> right now, that is all playing out. you are seeing a slowdown in activity. sales activity is not slow, it is just lower than it has been over the last couple of years which was unusually heavy. buyers and sellers have to work this out. it will take a year or two in price discovery. your rising mortgage rates. a little over half of the sales in manhattan were cash. it is not dominating mortgage rate stories and markets sales. year began to fall last before rates started to rise. mortgage rates are not the true reason for the slowdown.

it has a lot more to do with affordability and the tax law. >> tell us about the ultraluxury flight of the market and what the markets say there. are talking about the market north of $10 million for ultraluxury which represents a few percentage points of the market, that is the opposite of what the world looks at. in 2017, we had a lot of activity in the high-end except they were generally overpriced to begin with. sale,ld see a $50 million let's say, but it has been on the market for five or six years and is sold at a 35% discount. it is not that prices -- that the luxury market is strong, is that sellers have become much more connected with the market and doing it correctly.

julie: that was jonathan miller earlier today. i want to bring your attention to a story the bloomberg just came out with saying donald trump is preparing to release a list of $200 billion in chinese products to be hit with tariffs. this is according to two people familiar with the matter. this could be released as soon ,s tuesday and likely this week according to those people, they spoke on anonymity, this starts a week long process on comments and hearings. we are seeing the market reaction. joe: we see down futures reacting to the headline. issues.a lot of we are in this trade war and maybe people thought that there was this threat out there of a bigger list and it is making more details and bring this to the front of the mind.

scarlet: we don't have a timeline or it is just the fact that there will be a list published. we will continue to keep posted on these developments. it is time for the business flash. a global private equity fund is getting raised after 18 billion last fall. bloomberg has learned that the private equity firm is to seek more than $20 billion to market later this year. firms are packing a record $1 trillion in dry powder. a new york-based carrier is jets 45 60 eight to 20 $.4 billion. -- deal provides jetblue $5.4 billion. it ends jetblue's search to replace their previous aircraft which uses on short distance

routes. a costa rica, $424 million, you can own 3300 acres of what national geographic is calling the most biologically intense place on earth. the property located on the villa includes a mile and a half of untouched beaches. the property was put together by an american who visited in 1988. it also has perfect weather all year long. julie: it depends on what you consider perfect. scarlet: if we pull together all of our resources [over talk] julie: if everyone contributes -- joe: and the trump administration is set to release details. the dollar-yen is getting hit on these breaking headlines. coming up. ♪

michael: that does it for "what'd you miss?" -- >> that does it for "what'd you miss?" >> this is "bloomberg real yield". leverage has been building up over the last year or so. >> we are seeing a bond change .ecause

emily: i'm emily chang in san francisco. this is "bloomberg technology." in the next hour, tesla sets its sights on china. they're going to build a factory that could turn out 500,000 vehicles a year. how will this work on the trade campaign against china? , theresa may triggers a resignation a multiple full -- multiple officials. what this means in the u.k..