to signal concern in the u.s. >> people are much less confident than they were a year ago. scarlet: we have seven seconds to go before the closing of the the down managing to finish 27,000. >> do you pop the champagne on this, joe? joe: that is heartbreaking red there. 2999.86. >> underperforming on the big cap indexes. that is an interesting one. it consistently lags behind. on boeing, the company is the executive in charge of the 737 max program is

retiring. we know they have had a lot of issues with the plane. i have been trying to fix the software issues. boeing naming mark james to take over oversight of that 737 max program. >> retirement might be a nice way to put it. the big event this week was two days of testimony. >> he seems to be in favor of cutting rates. deliberately emphasize things going wrong globally. he is not that sensitive to economic data. i think his room -- his view is that inflation is somewhat under control. is such a dramatic change from six months ago.

joe: when the global outlook significantly dims, your ability to be purely data dependent goes away. you have to try to act ahead of the term. the fed has admitted that it does not have the conventional quality space to fight a garden-variety recession anymore. it is really about recession prevention. luke: that is the only game in town that requires you to act when the u.s. economy is falling off a cliff. >> we talked about this idea that when you give financial markets what they want, they will want more. as the fed given the markets too fed given thee markets too much? michael: if you cut rates, you are much less likely to get

unintended consequences. if you see the fed cutting rates and economic data getting better, this might be part of financial markets that suffer. even if you look at what qe2, long-term treasury yields backed up 100 basis points. >> we might have seen the bottom for 10 year yields for now. michael: i think you have. the 30 year, even more. joe: given this move over this long-duration bed, lots of potential losses. been people have positioning more tactically for that.

the computers over in london. bond.s not long people are positioning for the backup. the constraining factor is the rest of the world, the global environment. that is the constraining factor. >> i have to get your check on some of the corporate earnings. people are worried about a slowdown in manufacturing. that gross margin continues to roll over. that trend had been pretty much intact. how troubling is it for the broader manufacturing sector? michael: i think we'll is a mixed earnings and manufacturing. that has been the story of the last couple of quarters.

it is not a uniform slowdown. certain management seems to be able to navigate it. much more than others. demand -- end demand is still okay. this does not feel like 2016, let alone 2011 or 2012. >> michael, thank you for joining us. luke, you as well. julie sweet was named as the n.f eccentri has been run by the interim ceo, david. that does it for the closing bell. ? is up next.iss

this is bloomberg. ♪

>> live from bloomberg's world headquarters. caroline hyde is off today. i am joe weisenthal. is at a record high, the s&p is at a record high. the question is what did you miss? ground, the top economic agree on one thing, the

phillips curve is dead. socialident targeted media and gets ready to take executive actions on the 2020 census and citizenship. we will talk growth, tech and regulation. powell's second day on the help. on the globalions economy. >> central banks around the world are seeing this. the neutral interest-rate is lower than we thought. the natural rate of unemployment is lower than we thought. missouri causey has not been as accommodating as we thought. trends have injected uncertainty into the supply

chain, many have removed their -- moved their supply chains. many moved to mexico and then they found that mexico could be the target of terrorists. the consequences of failing to do so would be highly unpredictable. more, i want to bring in the president and founder of the upper research. he joins us from chicago. jim, i know you are on the market side of things. there was a strong jobs data report. 220,000. what is the case to be cutting rates right now? >> i think this is strong enough for fifth.ng this is higher in young than 99% of sovereign debt yields

worldwide. it is one of the highest interest rates in the developed world. interest rates are all about relative gain. 2.5% is not a restrictive rate. that is an absolute argument. on a relative base, our rates are way too high, it is restrictive, that is why the yield curve is inverted. we have to bring them down into the range of other rates. i am arguing that there is an international perspective about interest rates. everybody else's rates matter. we can't stand out as an outlier because we will do damage to our economy. >> that is as good an argument as we have heard about how a rate cut my feet justified. justified.

we heard larry kudlow say similar things about the phillips curve. aoc got how to admit that there are problems with it. >> he said you are right, the phillips curve trade-off does not exist anymore. that is news breaking. she got it right, he confirmed that the phillips curve is dead. the fed will lower interest rates because we are growing rapidly without any inflation. i look forward to discussions with madame aoc. have aow wants to meeting with aoc. why was this so significant? >> the fed has a dual mandate of height -- high employment and low inflation. they want to be able to say they're working on both ends of the mandate. the phillips curve is that there

is a direct relationship between inflation and employment. we know that has not worked for a couple of decades. the fed stubbornly needs that because of their dual mandate. if they are ready to admit the truth and walkway from that theory and say there are economic reasons that payrolls go up and down but they're not the same reasons, they will run themselves into a problem. how do you set policy? you have to pick one mandate over the other. you don't want to be in the game. he went as far as to say that maybe that theory does not work. an acknowledgment of -- acknowledgment of what is obvious. i am happy he said it. thingre finding a new they can operate under. >> changing the mandate does not seem possible in this climate. is there a way to tweak it to satisfy the market reality?

variable that we can rely on? that is the problem. i don't think there is. any are more tied to inflation target. if the phillips curve goes away, congress can scream at them that you don't care about employment. inflation toed on the exclusion of employment. why don't you start focusing on some sort of version of employment targeting? i don't think that would work but from an optics standpoint, that is the way they would be pushing the fed. this is why it is such a momentous thing. honestly, he walked it back a little bit today. maybe opening the door that it does work. time will tell. i hope you are in the room when that aoc meeting takes place.

that is jim bianco. ed hammond is standing by right now. i am here with the ceo. conference.resting i want to get into what is going on in the lodge. let's talk about 401(k)s. talk to us why -- about why it is so important. joey: 38 million americans don't have retirement accounts. for are not remotely ready retirement. incredible tax incentive for the government. that means you can put money

into an earned today account and it can compound, tax-free for a very long time. the value of that is tremendous to an employee. they are allowing a lot more people to participate in the economy. we were not taking advantage of it enough. we would match 100% of what .mployees contribute that helps people put a lot of money away for retirement. earners in thest company were maxing out what they could put into a 401(k). this helps bridge the income

inequality gap by not just moving money to these people but also helping them participate in markets where value creation has occurred and where a lot of that value creation has not gone to his lower earners and companies. they don't participate in equities the same way as higher earners. >> one of the questions that you -- we ares asked is in a red-hot market. i look at this one, up 300%. why don't you go now? >> i think they do. >> the thing about taking a not thepublic is it is

end goal. it is not the end goal for any of our companies. it is a nice steppingstone. you need capital, a currency, you can be used for acquisitions. if you need those things, going public makes sense. of red-hot and capturing that market, we are usually playing a longer game. when al is to figure out company is ready to go public. if some of those factors exist. then with -- we will consider taking a company public. i don't think it is the thing to do at this moment for them. >> will it be the next one? joey: i don't know for sure. it has a good shot. dotdash is doing well.

i think it is too small to be public but it is not impossible. billionave a couple of dollars in cash. what other companies are you looking at? this we are considering much more seriously than the past. minority investment. minority investment in ways that we can increase ownership over time. value to thereal company. as we have of that the market and the way the market has developed, there is this gap of things, a growth stage that has been available to us. go muchr have to earlier or much later. that middle stage, great companies are being built, great consumer products are being built. we want to participate in that.

>> we will have to leave it there. joe: that was ed hammond in sun valley. let's start with a report with this big consulting company. they named a ceo. they had an interim ceo for a while. basically since january. boeing shares are moving higher here. in charge ofutive the 737 max program is retiring, stepping down, replaced by marchex -- mark james. linbald is retiring. bloomberg. ♪

president trump holding a social media summit at the white house. it does not include the names you might expect. invited fringe internet voices. at the white house, a lot of unconventional voices, people who are very -- people who prays trump a lot. he talked about how great his tweets were. it sounds like he is in his element here. president was joined this -- the president was this up.hen they open you have people on the right with independent journalists. he was joking about people. he was saying sometimes i

misspell things on twitter. this was very much his element and a political event rather than something on tech policy. >> who was in the room with him? you wrote a story about some of the figures scheduled to be alongside him. >> you have people like bill mitchell. that is a radio host who is known for his trump boosterism going back to 2015 and 2016. you have a couple of approach from meme accounts and then organizations the heritage foundations, think tank, turning point usa. those guys are there. you also had a few lawmakers. marsha blackburn, josh holly. they were there to bolster trump's vision on social media. he does manage to get the

message out. >> research tells you that americans think text -- tech is biased. how nervous is tech? are we learning anything about plans? >> my understanding is that he was going to be having the companies coming into the white house next week. this is a classic trump move. you raise the pressure on somebody and then you invite them in. those numbers you are looking at are what allows them to do that. americans believe that social media in particular is biased. usually toward liberals. we see some other polling that says they might want to see some thatl many are regulated

is the pressure the pressure that tech is under as they come in. trump is going to get concessions out of them. they have to go to congress and the agencies. table bring them to the and make them want to compromise. >> that was ben brody reporting from washington. a quick check on the latest business flash headlines. bloomberglearned that -- learned that there is an investigation into this. a formerexamining goldman executive that worked at deutsche bank. this industrial parts company rejected a $955 million bid from crane. they called this highly conditional.

on immunotherapy. bioteche agreed to buy instruments for $1 billion. the use of immune system to fight cancer. flashs your business headlines. coming up, more of what the e-commerce giant is promising to gaino help its workforce more skills. it is all about the retraining program. this is bloomberg. ♪

>> tropical storm lidia storm barry has formed in the gulf of mexico. they could become a hurricane as it threatens louisiana. maximum sustained winds are near 40 miles per hour. additional strengthening is expected in the next day or two. the governor of louisiana has declared a state of emergency. forecasters say it could make landfall as a hurricane this weekend. discusspresident putin the long-standing conflict in ukraine with his new counterpart.

this was the first discussion between the two leaders. according to a kremlin statement, their talks covered efforts to return prisoners held by each side. they also discussed restarting discussions under the normandy format. a car bombing in libya. officials say to vehicles filled with bombs exploded. no military leaders are among the dead. there was no immediate claim of responsibility. delegationunion traveled to khartoum today to meet with the leaders of sudan. the transitional military council is preparing to finalize a power-sharing deal with the pro-democracy movement. >> our message is very clear. , justice, democracy freedom in this country. we are very delighted that the sudan has now taken a step

toward this. mark: the delegation is set to meet with a sudanese opposition group. and ethiopianan mediators. >> we want to bring you breaking news. companyquencing releasing preliminary earnings. it cut its revenue forecast. cutting the estimate by more than half. it takes the shares. pretty ugly action there.

spend has said it will $700 million to re-trainable one third of its u.s. workforce. transitionployees to into more highly skilled roles. how big is this? what does this represent? certainly makes a significant statement about how amazon sees the moment it is an. amazon is describing this as one of the biggest investments of its kind. that iscts a company between the tightest labor market and have a century and a political pressure on amazon

from figures in both parties. and rising activism by amazon employees who are not content with the conditions there now. amazon is always in the crosshairs for putting retailers out of business. how much of this is getting ahead of some negative publicity or catching up to political pressure? is trying to position itself as part of the solution. amazon would say that they are helping employees who want to rise into other positions within warehousey, including workers who want to do other

things. and workers who may want to move on to another type of job somewhere else. they find working at amazon more attractive if the career ladder is made that much easier to climb. that is how amazon is describing this. they are not saying this is about automation. will beainly it perceived as an part about how jobs are changing and the need to prepare workers for tasks that this company and others will want them to do. are you hearing things in regard to the tight labor market and the idea that companies need to offer a little bit something more? i was reading about some warehouses that install a indoor soccer field for its employees. there are arguments made by some activists and experts that

the policy is more significant than what people think in the terms of labor activism. some people feel emboldens not only by activism they have seen elsewhere but also by the condition of the labor market. we have seen in areas like public school teaching in west virginia and oklahoma. the state of the labor market affects all kinds of employees, even reaching into the public sector. , withcompany like amazon workers who are largely a people in less appealing warehouse jobs, it is a significant factor. >> always bringing it back to the fed for us. craze up, is the cannabis finally cooling off after all of the investor hype? why only one major pot

company looks like it will be profitable at the end of the year. this is bloomberg. ♪

>> breaking news out of washington dc. president trump says he has met with google and twitter executives. >> a former trader was convicted

of scheming to overvalue the firm's assets by hundreds of millions of dollars. the two were found guilty of conspiracy and wire fraud by a jury and that they used corrupt brokers to artificially inflate the value of security. we have a story on lap grown dairy. dairy.grown before he goes to market, the company has to face a big hurdle like consumer squeamishness and regulatory reviews. reportingtwitter is that new york has passed a new equal pay legislation as the success of the u.s. women's soccer team ignites the fight. it also bans gender pay gap discrimination, making it easier to sue for workers.

you can follow all of these stories on your terminal, bloomberg.com, and at tictoc on twitter. expertsh watch rebounded in may. earlya top end in 2018 in 2019, the data started to rally and luxury goods. has a ceo who talked with us. generally speaking, we have to remember that we make products that talk about people's confidence in the world economiche situation. we are always affected by these trends. the better people feel about the future, the better our applicants. >> how are your customers feeling?

>> they are feeling better. onare you seeing some impact sales or confidence? is ae key to china with a hugelyket expanding middle class. they are building up a confident group of consumers. there is monumental growth potential for the lecture he industry in china. a mores becoming dominant force in the luxury market. shakes andthere are confidence, that does affect consumer outlooks in those markets. we are trying to be globally based. is morefocus in asia

the second and third tears cities at the moment? >> there is also the effect of china being two markets. china domestic and chinese tourism. time.markets balance over you have to have a global strategy to be speaking to chinese consumers. and be there when they feel like shopping. >> iwc is a brand that is less well-known in the u.s.. you have been building your marketing with brand ambassadors. >> we have an american founder. he came to switzerland to combine american manufacturing

technology with swiss craftsmanship to make perfect watches for the american market. it seems natural that we would focus on this big luxury market in the world. in theld our presence u.s. consistently. this is starting now. for the longre term. you have said that you want to double revenue in the u.s. in the next five years. are you on track for doubling that revenue? >> we don't figure -- comment on figures necessarily. >> let's talk about e-commerce. your parent company saw profitability last year fall to its lowest level in a decade. a lot of this was put down to investment online. how much are you contributing to that offering?

what percentage of sales are you now seeing coming from online? is to offer adea service that is consistent across every service channel. our clients are able to interact with us in any medium. important to very that strategy. a number of years ago, we launched an e-commerce channel in the u.s. the u.s. is a market that is quite active in e-commerce. it does not stop there. we also have a very strong corporation. other strategic partners in the wholesale network. even including pre-owned services. >> what are you seeing in terms of sales from online? are you seeing growth coming from their? >> there is definitely momentum.

igionally and culturally, think the u.s. market has a much quicker uptake of e-commerce compared to some of the regions. romaine: let's get a quick check of the next headlines. shares of delta airlines rose today. to commandeen able higher fares because of travel demand and lower fuel costs. the grounding of the boeing 737 max ins there are fewer airplanes out there. the largest alternative asset manager keeps raking in money from investors. the next frontier for the national basketball association is india. we spoke to commissioner adam silver at sun valley. >> that is where the people are.

roughly one 4 billion people. we know from our properties that there is tremendous interest among young people. owner who nba team was born in mumbai. this is the passion of those to bring the nba to india. we are set for two terrific games in mumbai. those two preseason games will feature the indiana pacers and the sacramento gangs. that are your headlines. joe: pressure is mounting on pot firms to turn a profit. most of the large canadian cannabis companies are expected to end 2019 in the red. reporter joins us from toronto.

that the hypelear that's fizzled in large part from investors. a lot of the stocks of not done well. we saw the ouster of a leader over a canopy. now, what is the view on the quality of the business in canada and their ability to earn profit? was goinge said 2019 to be the year that the industry experienced a shakeout. i think we're starting to see the beginnings of that. is a real wake-up call to investors. the original founders are not going to get a free ride. there is tremendous pressure on these companies. most of the rest are using -- losing large sums of money.

there is a lot of pressure. but not a lot of performance. >> have any of these companies that a risk analysis of what happens if federal legalization in the u.s. does not happen? a great question. a lot of them are banking on that. they have the hopes that legalization happens so they can have a presence to build off of. i don't get a sense of the a lot of these companies have done a real risk analysis of u.s. legalization does not happen. i would dispute the comment that the canadian market is mature. we are just getting to the point, coming in december, where

we will have things like edibles, beverages, vape pens. there still isn't much of a retail store presence in major provinces. there is a lot of growth potential still coming in canada. romaine: outside of the canadian market, yet the u.s. market. what about europe? that was supposed be trending >> in favor of the cannabis industry. i was speaking to an executive who said we might need to revise our expectations lower on the international scene. we will build up our presence and have a big global presence to assert our dominance. a lot of those countries, with

personal -- the couple exceptions, are moving slowly toward legalization. the markets are still tiny. that may stay that way for several years to come. going to be profit generators everything soon. thank you. up, more unfulfilled promises. president trump says china has not increased its purchases of u.s. a cultural goods. how china is responding. this is bloomberg. ♪

>> president trump is complaining that china is not upping its purchases of u.s. agricultural goods. about to do so.

u.s ag purchases were a non-starter. ahn: we have seen tariffs rise. so far, the president has put those on hold because he says the china promised to buy more agricultural goods. a tremendous amount of farm goods. -20, since we had the g china has not confirmed that. president hoped that they would buy more agricultural goods. they have not confirmed it. there is not a written document

that officially says that china will buy more goods. around andrning it saying, we do hope the president to liftp his promise the blacklist from huawei. we were talking about this china trade taylor. -- data. shery ahn: we are expected to get those numbers. when it comes to the imports number, they are expected to fall. when it comes to exports, it is a contraction for the first time since april. all of this has given the fact that we are seeing external demand weakening. we have seen week pmi numbers

out of the euro area. we believe china's exports will fall. ae: what we have seen stimulus so far, other signs right now that it is gaining traction? shery ahn: we are seeing credit expansion in china. it seems patchy. social aggregate financing numbers. we could have seen a rise but that is more to do with seasonality. make sure to tune into daybreak australia and asia, starting here at 6:00 p.m. eastern. boe governor speaks at the london business school. joe: and i will be watching economic data come out. another count comes out tomorrow. taylor: that is all for us. romaine: bloomberg technology is

coming up next in the u.s.

emily: i'm emily chang this is bloomberg technology. president trump holds a gathering of conservative social media users. while he says he will be summoning up against a the white house. amazon wants to read train workers. it says it will spend hundreds of millions of dollars to do it. this as the company is under intense public