savings - but only for a limited time. just go to leesa.com today. you need this bed. ritika: i'm ritika gupta. bloomberg has learned president trump met his top national today as his team prepares to unveil a peace agreement with the taliban. the secretary of state mike pompeo and national security advisor john bolton met with the president at his report in new jersey. sources told bloomberg the plan will be presented to taliban leaders in the coming days. the new u.s. ambassador to mexico arrived in mexico today to take on one of washington's most important diplomatic posts. the job had been vacant for over a year.

speaking to reporters at mexico city's airport, he said he arrived with his hand extended. he added "the united states brings hope for a prosperous and stable mexico." the new governor of puerto rico knows he has a tough road ahead, but she says she is preparing for it. pressld the associated her priorities are to fight corruption, secure federal hurricane recovery funds, and to help puerto rico out of its 30 year recession. she is excited to finish the team of the former governor who resigned earlier this month following a massive protest. the trump administration has informed congress it plans to sell f-16 fighters worth $8 billion to taiwan. it is a move that is sure to escalate already high tensions with china. two u.s. officials and

congressional aide say the administers and have informally notified lawmakers of the potential sale. the f-16 deal would be highly controversial because china fiercely opposes all arms sales to taiwan, which it regards as a renegade province. global news 24 hours a day on air and at tictoc on twitter powered by more than 2700 journalists and analysts in over 120 countries. i'm ritika gupta. this is bloomberg. ♪ scarlet: from bloomberg world headquarters in new york, this is "bloomberg markets: the close." i'm scarlet fu. caroline: i'm caroline hyde. we are about 30 minutes from the end of the trading day. the trading week. what a tumultuous week it has been. we end on a high. chipmakers really invoked today. nasdaq beating in terms of its numbers that felt out yesterday.

the risk on move. is it talks? is it the hope that germany may one day open its pursestrings, spent fiscally? deutsche bank gets a lift. scarlet: the euro goes a little bit lower. you are watching the pound as we get ever closer to brexit, but we know it will somehow get pushed off and there will be more drama in the meantime. caroline: you sound cynical. i can't believe it. a way to stop the no deal brexit is the key concern here but much talk about the government. scarlet: if you look at each react that tracks big cap german stocks, recovered from a six month low. the lift in german stocks overall and the move in the euro has people wondering whether europe will be the source of the next form of market stimulus and economic stimulus. oil prices paring some of their gains. they rose as much as 2.2% earlier. oil cannot catch a break. caroline: it can't. 30 year bonds. scarlet: look at that.

caroline: 4 basis points higher. the german bond selloff. we see the rest on tone. finally something in the longer data. scarlet: don't get carried away. this is just a breather. the trump administration is formally telling congress it supports a potential sale of f-16 fighter jets to taiwan. for more now, let's bring in someone who leads the national security coverage in washington. this is interesting timing if nothing else that the white house plans to move ahead to sell 66 f-16 fighter jets to taiwan, knowing full well china will not be happy about this. >> it certainly is. it has been a very volatile time the past few weeks, the past few months in terms of u.s. and china trade relations. the president just yesterday told reporters that he plans to have a call with the chinese president xi jinping really soon. i don't think this kind of an announcement makes that conversation any easier. the u.s. and china have been looking for a way to have a

breakthrough entree. dollars --illion breakthrough in trade. billion in planes to taiwan. we are not in a situation where jets are bound for taipei at this point, but if this deal goes through, it would be the first sale of u.s. fighters to taiwan i think since 1992 during president george w. bush's administration. so it has been a very long time. other administrations have considered it and decided against it. this is not a final decision, but it gets us one step closer to the sale. caroline: is this going to be a future trade chip in the bargaining talks? bill: it could be. all sorts of reasons to delay a sale, to not approve some sort of a contract that i want six to seeksate -- that taiwan to negotiate.

the president suggests sometimes his decisions on huawei or other chinese companies also are things that in theory could be negotiated. scarlet: i would be surprised if it was not used as a negotiating chip right now when it comes to the white house. i want to turn the attention to what is going on in north korea because the country has now fired two more ballistic missiles into the eastern seat. now, and howally does it compare to previous rounds of missile launches? bill: we have seen a rash in the last few weeks. we have seen half a dozen launches. it is a pace that is ahead of where we were in 2017 when tensions between the u.s. and north korea really ratcheted up. the difference this time i think is we are not seeing any of the long-range intercontinental ballistic missiles. we are seeing more short-range missiles. even though those are also against the u.n. resolutions and sanctions, president trump has really kind of dismissed those things as the type of missiles that everyone tests and not one

of his major concerns. he has really tried to keep the limited talks on track. he says he still has a good relationship with kim jong-un. he does not want to i think make a bigger deal out of this than i think people would have in the past. caroline: we have not seen this number of ballistic missiles being tested since the threat of fire and fury back in 2017. what is north korea trying to say here? either try to demonstrate things are not going the way they want. -- are they trying to demonstrate things are not going the way they want? bill: north korea is pushing the u.s. to end all military cooperation with south korea. you may remember president trump to get the first summit in singapore in april last year agreed to suspend major military drills with south korea. the north koreans have been pushing for more. they want a lot of the almost weekly and monthly lower-level drills that maybe don't involve

tens of thousands of troops but are still significant. they would like to see all of that ended. north korea has long wanted to drive a wedge between the u.s. and south korea. south korean president moon wants to try to keep talks on track. so i think north korea feels like they have a little bit of leverage there. that said, the u.s. has really rebuffed those efforts and president trump's comments show he is not too concerned at least for now about a lot of these shorter range missile launches. scarlet: north korea releasing an opening to get in between south korea and washington. thank you so much. up, the london stock exchange hit with a second outage in just over one year.what means for- what it the markets and the u.k. departure from the eu. everything comes back to brexit. caroline: it never goes away. scarlet: it never goes away. this is bloomberg. ♪

scarlet: it is time now for our top calls, a look at some of the movers on the back of analyst recommendations. tjx upgraded to buy from hold with a $60 price target. improved brand, attractive assortments, and healthy traffic trends. 2.75%.ck is up by a deterioration of trends at the case paint line in particular -- the kate spade line particular. nvidia having its best dig in the year after reporting second go to results that beat analyst estimates. the price target increased at morgan stanley. the analyst there said it featured unexpected good news on gaming earnings. shares are up 7.5% right now. those are some of your top calls. caroline: thank you. let's talk about the london stock exchange because it suffered a long blip today.

joining us is the bloomberg news asset management reporter. >> close to two hours actually. you can imagine any traders waiting for information on pricing for things like the ftse 100, the u.k. blue-chip indexes were in trouble for that one and a half hour period. scarlet: it may only happen 1.5 hours but it probably felt longer for people. what other problems arose from this glitch? annie: it was mainly a problem for traders waiting for pricing information. it cleared up afterwards so we did not affect end of day prices or anything. but in waiting for that "that .as the problem caroline: any transparency on what went awry? annie: not much more information that we have now but a software

ever. just a reminder of the kind of very electronic environment the exchanges are operating in where the software is fallible and you see glitches. scarlet: people tend to blame something for anything and everything. they want to make sure etf's are not to blame. annie: they are often the scapegoat, but in this case, they got off scott free. people might remember august 24, 2015, which was another major trading issue kind of day. scarlet: there you go. caroline: to be fair, people read because they were taking on a massive m&a. they want to be the powerhouse. a future grower having glitches. this is happening more and more often. annie: that's right. this is a week where we saw a lot of strange exchange occurrences. you had issues with closing prices for stocks including apple for a while this week. all that sorted out again but it

was another strange issue on the u.s. side. these errors do occur. you have outages sometimes. there has been a three-hour outage before. era, youhe electronic are not completely moving away from issues with exchanges. caroline: as if your week had not been any more tumultuous. add it to the list. thank you for breaking it all down for us. let's get you a quick check on the latest business flash headlines. opec says global oil market space a somewhat bearish outlook. this comes amid a slowing economy and a trade war that may drive up prices. saudi arabia has deepened cuts in july to more than 9.5 billion barrels a day. apollo global is jumping into investing. blue because learned the company is happy to raise $1 million for its new fund.

others are pushing into the arena. wells fargo adding to the gloomy outlook for financials. it is cutting its price target for more than a dozen stocks. the wells fargo analyst says there is no way it should impact negative rates. have about 15 we minutes to go before the end of the trading day and the end of the trading week. what a week it has been. the russell 2000 is going to end up closing the day up to percent but still a loser for the week -- 2% but still a loser for the week. right now, kind of a sigh of relief there are no trade headlines to go off of. caroline: it means we have a slight risk off tone. talkinging that we are about wells fargo downgrading the banks on the backs of these lower yields. merrill lyncha revised its forecast. the 10 year at 1.25%. yearet: the 1two

following below. you are getting a break in the never ending bond rally. a weird day. caroline: all about potential stimulus in germany. we will see if that proves true for once. this is bloomberg. ♪

♪ caroline: this is "countdown to the close." i'm caroline hyde. scarlet: i'm scarlet fu. joining us at this hour as always is joe weisenthal. for once, we are not going to talk trade but we will talk the prospect of spending out of europe. a headline this morning that got some attention. a german publication saying the government might be willing to relax its commitment to balance budget in the event of a recession, which is not that much. that is what you expect.

but even the fact that the headlines are coming out, talks about people recognizing the need for something, i immediately got flashbacks to 2011 during the greek crisis when everyone was looking for headlines to figure out what the germans were going to do. nonetheless, that gave yields all around the world a bounce. deutsche bank in the u.s. up now 7.7%. that might be the best day of this year or very close. the best day of this year was in the middle of january. it speaks to the idea that the banks in europe, i don't think they want more monetary easing or more negative rates. they want to see more growth and fiscal stimulus. very tentative. you don't want to put too much on these when i'm have on-site reports, but it is interesting that some of this is trickling out. just keep saying it. eventually one of the rumors come true. scarlet: reports that monetary stimulus will be more than anybody expect. that adds to itself. caroline: for mario draghi.

he has done so much. everything he can pull out. he just wants germany to start spending. scarlet: everyone is passing the baton around, and we will see where it ends up. when you look at how it affected the equity markets, every single sector when you look at 24 sectors in the s&p 500 is higher. chipmakers up because of nvidia so that is giving got a lift. banks have had a painful week. finally getting a little bit. caroline: a little lower today. interesting, the bloomberg scoop. the likes of jamie dimon, moynahan, all on the phone with trump. capital goods, transportation, even autos up there. scarlet: the inverted yield curve. crazy. joe: it is crazy. i love that theory. scarlet: on the downside, you got safe havens of choice. staples, theyd

are up but not as much as the rest of the market. you put it altogether and it has been a pretty straight line higher. caroline: for once -- scarlet: the russell 2000. caroline: finally the upper former. scarlet: it has lagged behind everything. be innot a good time to this stage of the cycle. we are moments away from the close. seven minutes to go. let's take a closer look at some of the action in the markets. jessica, what are you watching? jessica: i'm taking a look at crude oil because it has been a whirlwind of a week. fluctuating between gains and losses this week. if you take a look at my chart, closed below $50 a barrel. the driver has been the u.s. and china trade war and the concerns about oil demand. i want to bring up the opec report today, which has been much focused on. we had opec come out and say it

has a bearish outlook on oil for the rest of the year. to meet, this put pressure on saudi arabia to cut production even further. saudi had conversations last week with many producers about a potential oil policy response. so we will see if anything formalized. abigail: also on a whirlwind move at least over the last few days, ge. yesterday, a big loser, finishing down 11%, the worst day since 2008. today, the best stock on the s&p 500. this is a three day chart so you can see the drop and gain. harry,this yesterday as the bernie made off whistleblower, said there is accounting fraud at ge. basically saying $38 billion with the funds could be owed. a lot coming out i got stuck today. i spoke with nick kamen, the stock. -- defending the stock. in addition, you have other big

investors including stanley miller and the famous short seller also buying. they are saying fraud is not the same as aggressive accounting. what we put this together with the rsi or momentum indicator, since last year, deeply oversold. at that point, the stock climbed sharply this year and when into overbought territory. kind of in the middle but we have been in deeply oversold territory. back out of there. there may be a buying opportunity ahead for ge. caroline: they rose to the buying opportunity today. we thank you. we for more market analysis, are joined by the senior market editor for bloomberg news. what a week. >> what a week. i sort of question the respect today. i think the president calling to bank ceos is a big deal. it is the most read story on the bloomberg today. that tells you people are very

interested in that. he is getting some outside counsel. the story i have some questions about. i'm not sure that it signals a big stimulus package. if you read the translation i read if there is a recession, there will be a drop in tax revenue. they will issue bonds to cover the shortfall. it does not sound to me like they are planning a big stimulus package. especially one to front run a recession. we will have to wait for a recession for this for one thing. it might bring the german yields up a bit. craziness inugust the markets today. caroline: what about jackson -- joe: what about jackson hole next week? michael: i'm not sure if we are get any sort of huge news out of it. jay powell will deliver his challenges. i don't know if he will talk about a certain twitter account being part of the challenges.

[laughter] michael: the negative yields guy here. but certainly the pressure will be on for him to deliver something reassuring to the market. i imagine he will take that opportunity to do that to some degree. i don't know if it would be a massive risk on rally. scarlet: i'm sure expeditions will build up as we get closer to it. we are about three minutes to go before the close so let's bring in ryan leavitt. brian, clearly a pretty wild week here. is the reprieve we are seeing today short-lived or can at last? >> it is probably short-lived. at least in the very near term. we are still dealing with quite a bit of policy uncertainty. these markets will likely turn. we may see a further downturn in here. what we are looking for is some clarity. mean, we started to see it from the central bank. i think the central bank will continue to give indications of it rightfully so. what we need more is from the

administration. businesses are stalled right now because we are adjusting tariff rates, changing policy on the fly. it makes it more difficult to put forward an investment plan. caroline: if we look to the federal reserve, is there anything that they can say jackson hole or otherwise afterwards that would give you the policy caret you needed to think the levels of the s&p are vindicated and can go higher? brian: yes because the two large underpinnings of this cycle has been central banks responding when growth weakens and china responding with stimulus when growth weakens. if those are two large underpinnings of this cycle, this trade conflict and brexit actually extend the length of an easy fed environment and china coming forth with stimulus. i have been saying for some time this cycle will go on far longer than most people suspect.

there is an inverted yield curve for a brief moment this week. does it give me some pause on that? yes, of course. but just because you have an inverted yield curve for a brief moment does not mean you need to stay in the environment. the federal reserve coming forward with more stimulus hopefully steepeners the yield curve a bit and the cycle continues. scarlet: makes it less flat. joe: you mentioned the story about president trump talking with the bank ceos. it remind me of the famous miniature letter from last december where he says the banks are safe. brian: good point. joe: does it signal there is a little bit of a trump put still on this market that for all he wants to talk about trade war, he is still very much watching the market and there gets to be a point when he gets concerned that it goes too far? of course, the ongoing war between peter navarro and the editorial board of "the washington journal." does this start to potentially

forced trump to ease a little bit? michael: i think so to some degree. news had deleted when the do-- leaked when it out was down 800, it would have had a different reaction. i think people were able to interpret it differently and get excited about it, but yeah, is that was on wednesday it might not have gone over so well. caroline: talking about excitement, we saw a little bit today. rise in the s&p 500. volume is down, though. we were off by about 8% on the nasdaq trading. chip stocks let us higher throughout the day. scarlet: all 24 industry groups in the s&p 500 rising here as we see them pare their losses for the week. still the third straight week of losses. in late may the s&p closed down for four straight weeks.

we are moving in that direction at the least. within the dow, 251 points from the trough, narrowest this week. things have moderated quite a bit. joe: does not feel like moderation and seven this week. let's dive deeper into the action without reporters. abigail, what are you watching? down on theup, net week, perfect time with this kind of volatility to be checking in on the technicals. this is a weekly chart. 30-day moving average and you will and the 200-day moving average over the last decade. when this has not quoted the 40-day moving average, including june, and back in once again right now, technicals overall suggest that there could be a pullback. in the near term, we could see a bit of a pop.

thanks, abigail. we saw the narrowest intraday move, but the big moves of becoming the norm for august. if you look before today, 12 days in a row we saw intraday swings of more than 1% for the s&p. today you have the s&p close above 1% once again, actually marks the and that seventh day already in august that we have seen the s&p close either above or below that one present social. -- 1% threshold. sure, august is particularly volatile. however, this time we are seeing it on pretty massive volume. the average daily volume of shares that of traded 8ands any day in august, 7. billion shares from the must for any month going back to december, making august not only one of the most volatile but one

of the hottest related to trading volumes this year. joe: thank you very much, abigail and sarah. still with us is brian levitt of invesco and bloomberg's michael regan. word tradehe deal, you might expect international stocks to rally more. nonetheless them even before the trade war, the international market has badly underperformed, especially e,m, for years now. what in your view could turn that phenomenon around? brian: it has been a very strong dollar environment because money is going to float up of the world where growth is that are competitive expectations. in many instances, particular emerging markets have underwhelmed. what usually changes that is the end of a fed-planning cycle and the u.s. running big deficits. to-weakerld be stabler-

dollar. the problem this time around is the trade conflict has only exacerbated that and led to another leg of dollar strength. at some point if we get back to growth, u.s. is, a 2% 2% inflation environment, without policymakers trying to muck it up, and the emerging market can get some flows in, evaluations are pretty attractive and inflation is benign and currencies have been beaten up, that is when you start to unlock it. we are not there yet. scarlet: i want to come in with breaking news here -- treasury has announced an outreach program to deepen the understanding of the market for the ultra long balls. it says no decision -- ultralong bonds. it says no decision has been made on whether to issue such products. joe: looking at the austria 100- year bond, whose face value has

doubled in the past year. caroline: why not? ultralong bonds include 50 to 100 years. scarlet: how would that play with the market? brian: i think the market would digest it. i have been the only person in america for the last decade and we might not have enough debt. everybody seems so concerned that the united states has too much debt. if anything the deficit strength for the last eight years until stimulus. i think we need more stimulus in the economy. something like $280 trillion investable assets around the world and $60 trillion of sovereign debt of 40% of which is negative-building. i think the market would embrace it. caroline: should be central bank stop hoovering it up itself? brian: of the central bank is too involved in these markets? maybe they are, but every time the central banks try to pull

away from we have seen the dollar strengthened and the yield curve flattening and the energy selloff. it has not been able to sustain it. central banks need to go at this modestly. i thought last to the three interest rate hikes was a policy mistake command center banks will have to continue to provide support to these markets. obviously, we mentioned jackson hole. i guess trade is the other one, which could give this market some direction. michael: one important story was the rebound in ge. ge is not the blue-chip pillar of the dow -- scarlet: no bellwether. michael: in the stock market. in the bond market it is very important, the elephant in the room into triple b category. should the rating agencies take this more seriously and agree and downgrade ge to job not to say that will happen, but it is something that people are worried about.

all of a sudden you have a lot of debt moving from triple the possibly into junk-bond territory. that has the potential to cause nott of bulls that we have gotten our heads around. caroline: also to look ahead to this coming week, trickling of more earnings. a lot of them are related to the consumer, particularly the housing market. lowe's, home depot. how much are you giving credence to the earnings story at the moment, and where we sit with the u.s. consumer? certainly important, and a lot of what you are getting with the consumer is more coincident indicator. when you look at the earnings picture, companies that have greater than 50% of exposure outside the united states are suffering more than those that are domestically focused. from an equity market perspective, true growth, long-term secular growth

companies, are not that excessive to me given the interest rate and the inflation world. when we get back to the recognition that it is a modest growth environment, stop playing around from a policy perspective, i think investors will pay a higher multiple on those earnings. what is the alternative? scarlet: before we let you go, brian what do you think president trump has talked about with jamie dimon -- [laughter] scarlet: with michael corbett and brian moynihan? i suspect the initial conversation about what the initial juncker means for the ongoing business operations for the banks and what signal that is providing to the market. saide that the bank ceo's to the administration, look, this is a good economic backdrop . you are running for reelection in 14 months. you have told the american people that you make good deals and you are good for the economy and the market is going to go up.

you have the macro backdrop so long as you allow businesses to invest with some clarity on what the rules of the game are. i hope that was the message because when you look at past periods of a flat or inverted guilt goods, you have funky things going on with the economy, whether it is the 1970's with inflation or late 1990's with high multiples, 2006, 2007 with household debt. you don't have those big excesses right now. hopefully the message was let's not do any harm. scarlet: let's not create any excesses were none are needed. brian levitt, thank you for the mike regan, thank you as well. just to recap the headlines in the segment, the u.s. treasury is doing market outreach on altra long bonds. it is going to do market outreach for the it does not mean it has made a decision or going to offer such a product. interesting looking into it. it brings up, joe, thoughts about the 100-year bond. joe: everyone wants the extreme

duration. why not? scarlet: that does it for the closing bell. remain bostick -- romaine bostick is stepping in for "what'd you miss." this is bloomberg. ♪

caroline: live from bloomberg world headquarters, i am caroline hyde. romaine: i'm romaine bostick. joe: i'm joe wasn't all. joe wiesenthal. the question is, "what'd you miss?"

caroline: how traders are making money in a negative-yielding world. the view from bank of america. brian moynihan tells bloomberg that the biggest recession is the fear of a recession itself. shederome powell may playe some light on future poliy at jackson hole next week. investors fleeing risk have boosted the market. putting money into assets, returning to less than their face value. there are ways it can be traded for profit. a bloomberg strategist joins us now, our trader in chief and in residence. of all, il, -- first have to be clear on this, this is a tricky subject -- on paper these look like great trades. what they are really -- but they

are closer to paper than reality. when he was swapping from one part of the curve into the next part of the curve, and here you are borrowing at a deeper negative than one part of the curve and lending until last. you are borrowing at 90 basis points and lending negative 80 basis points. joe: it hurts the head. vincent: it hurts the had to do it backwards, trust me. --h the swaps you are going you can obviously fixed the fixed part of the trade. the floating side of the trade is a variable. that could and does change with time depending on what was going on in markets. that trade is part of that kind of concept, easiest way to explain. the curve shifts, the trade could go ugly really quickly and against you. it looks good on paper, but in principle it may not work for you. i have beentrader,

on that site and it is not a a lot of fun. the easiest way to make money in this type of negative yield is the capital gain portion of the buy it, it hh is you goes deeper into negative territory, and you cash out any point between now and majority. that is the boring part. romaine: people already talking about how the bond rally -- vincent: it has gone a long, long way. romaine: ok, but at the same time you are getting headlines that the treasury might consider it 100-year bond. at some point -- vincent: well, the treasury explored this in 2017 and the markets didn't have an appetite for because they thought that bond yields were as low as they were going to get and they did not want to fund the treasury at those levels. which they had done that trade two years ago.

you look at what was the intelligence behind the argentine 100-year bond. not looking so pretty at the moment. caroline: austria. vincent: austria is looking great, but you have so much debt in a negative feel that when this trends, it will get awful ugly, awful quickly. joe: let's talk about currency hedging, or following dollars and buy yen -- are there opportunities with yields so low? vincent: there is, but it is the same situation. the better the credit would get the better the -- that is where the real arm is. you can borrow cheaper than your neighbor. up pennies, not a huge trade. it is still a risk with the variable that the ship of the curve changes.

if you do a full on hedge, you are pretty much -- when you do a straightforward currency swap, you are slumping one set of-- swapping one set of interest rates into another. arenumbers that you see supposed to take away the arbitrage opportunity. what is left over is small and not on either side. you are not taking up the full credit because you are hedged. ly,oline: interesting seen the treasury rise to reach a new high for the day. some sort of re-steepening ever so slightly. what about deeper yield curves?even if they are seriously negative like japan, could they go there? >> that's a good question. again, you just trade in the shape of the curve at that poin t. i think the last time i looked there were 5.5, give or take.

doespends on what the fed in the bill market. if there is more issuance on the backend, you will see a statement of that curve. that is definitely a trade, great way to play. but what is the appetite for that? i honestly can't tell you. romaine: all right, vince, thank you. we will keep an eye on the yield curve. coming up on monday, the boston fed president sits down for an interview with kathleen hays at our boston bureau. be sure to tune in for that. coming up here today, opec's outlook on life is global markets might be someone bearish for the rest of the year. this is bloomberg. ♪ ♪

romaine: with a slowing economy and ongoing trade war, opec says the mobile markets have a somewhat bearish outlook for the rest of the year even though supplies will be tighter than previously thought. tina, oil is trying to get its mojo back. a little earlier today up 2% or so. opec was interpreted as bearish despite the fact that in his report it seemed to hammer home the idea that there was enough there to support the price. >> it seems like you could read whatever you wanted into this report. future not terribly exciting. there are expectations of what is going to happen supply and demand-wise, for this report went further commenting on the market, which is not something it regularly does. they included the phrase "somewhat bearish" about the

markets command that reflects what we have seen from saudi arabia and its allies and the opec members. rent is below -- brent is below $60 a barrel. are there times in the oil market where oil trades on supply and demand and people alike, pipeline explosion here, blah blah, and other times the macro its wants it sell everything, sell some oil because that is what you do. jeffrey had goldman's on bloomberg television this week and he said that while markets are not trading on supply and demand fundamentals any longer, purely a sentiment play. that may be slightly an overstatement. it has been divorced from a lot of things and moving in line with the stock market a lot. broader based that on whatever the trade war is going to come out of. ca onine: we had rebec

earlier, a trader there, and she mentioned some of the names and how hard it the oil stocks are in comparison to how hard hit the oil is. what is the dynamic going on there? tina: it used to be drill, baby, drill, and the market would reward you with more cash. in the past year or so we have seen investors get a lot more picky about what they want to invest in. they know longer are rewarding -- they no longer are boarding growth, they want to see cash flow. one of the indexes i look at them s&p oil indexes, down 20% even with wti up 20%. that shows investors and how they feel about crude versus how crude is doing. romaine: and there no sort of revision downward on the production side. here in the u.s. we are seeing the rate counts go up. tina: interestingly, today we

got the first increase in seven weeks. everyone is wondering how long it is an doesn't mean that shale sorting things out. there is an uptick now. we are seeing a response, and opec trimmed the forecast for non-opec supplies. that may not actually happen. caroline: always great to get such a level of expertise. let's get a check of the latest "business flash" headlines. apples battle with the european union reaches courts next month. spotlight on the antitrust commission's crackdown on deals. the european commission ordered ireland to recoup the record some. the world's richest company has been handed an unfair advantage amazon has designated products sold by certain companies as "top brands."

they could ease tensions between the online retailer and those companies. apple has labeled surgeon products bestsellers or amazon choice. walt disney world is offering discounted tickets to those who want to sleep in. the florida resort is selling two-day tickets for as low as $80 a day as long as they show up in the park after 12:00 p.m. these tickets are good for resorts. flash" ofur "business grateful to another story that caught our attention, president trump reportedly wants to buy greenland, the world's biggest island. denmark is not selling. "the wall street journal" reports that the president's apparent interest has left advisors completely bewildered. fromve this great tweet the foreign affairs committee in greenland saying -- look at all "weemojis they use saying

are not for sale."the politicians that represent greenland in denmark are saying that denmark doesn't own us, anyway. joe: everyone says they are not for sale until someone makes a bid. romaine: you think denmark has a price, or greenland has a price? well, we have tried to buy them a couple times before. they told us to kick rocks. and then in the 1940's. but the 1940's attempt, that led to the nato agreement we have where essentially we did not need to buy them because we have nato forces. can we just go back to that? caroline: how do you pay rent on that, anyhow? romaine: what is your price, joe? joe: for denmark? $100 million in gold. caroline: that could be something that rallies further. quite amazing. joe: coming up, it wasn't just a rough week for stocks.

bitcoin having his worst five-day's life. -- five-day slide. this is bloomberg. ♪

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♪ the first word. new details about jeffrey epstein's death. "the new york times" says the autopsy indicates he committed suicide by hanging in his jail cell. that refutes some theories he may have been murdered. he was awaiting trial on sex trafficking charges. epstein's death is the subject of four federal investigations. bloomberg has learned president trump met his top national security advisers today, as his team prepares to unveil and afghanistan peace agreement with

the taliban. secretary of state mike pompeo and national security advisor john bolton met with the president in new jersey. sources say the plan will be presented to taliban leaders in the coming days. more states have joined the latest court challenge to trump administration rules on immigration. the measure would block green carts for -- green cards for many immigrants who use public assistance. the lawsuit filed today by california, maine, oregon and pennsylvania, follows others this week including one involving 12 states. the new rules are set to take effect in october. the native american tribe leading the fight against the dakota access pipeline wants a judge to resolve all legal challenges to federal permits issued for the project. the standing rock sioux argued the $3.8 billion project needs to be shut down until the government has conducted an

environmental alanis -- analysis and studied alternative pipeline routes. the pipeline sparked massive protests before it started moving oil in 2017. global news 24 hours a day, on now -- on-air, at tictoc and on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. ♪ romaine: breaking for air travelers. the u.s. customs system is apparently down nationwide. this is according to a tweet from jfk airport in new york. they say there is a shut down nationwide that is affecting how they process passengers coming into the system. they say they are doing it manually right now until the system is back online, and there are delays. its worstin just had week of 2019. the world's largest cryptocurrency falling as much is 15% this week.

it is the largest five-day slump since november. the bloomberg crypto index is also heading to the weekend in the red, down more than 10%. rough moves for stock, people asking if bitcoin is really a safe haven. here to help us answer that is andy bromberg. people keep trying to say crypto or bitcoin is going to be some macro thing. and it is still pretty hard to see any relationship up or down between bitcoin and everything else. does it have safe haven properties yet? or is that wishful thinking on the part of believers? andy: bitcoin has attributes that would make it a good safe haven asset. you can move it variably from place to place, it has a mathematical limit on supply, so that makes it interesting. but the second piece of being a good safe haven asset is having people believe that narrative. and gold is a good safe haven because people believe gold is a safe haven.

that is a self-fulfilling prophecy. every year we see bitcoin get closer that narrative being played out in the public eye, the trade war is making that more significant, but it will take time before it reaches that apex of being a safe haven. romaine: how much of it is being used as a short-term haven? i talked to a couple of people when we had the surge couple of weeks ago and it tapered off, and they were talking about how people were rolling through it, to get from point a to point b. andy: it is mostly being used in a very, very long-term sense. people don't want to weather a storm of one year to five years, it is much longer than that because they believe bitcoin is a safe haven asset. in the short-term, its being used for other cases, but less so as a safe haven it hasn't shown yet that is -- that it is uncorrelated with the broader macro market. got involvedentina this week with their turmoil. i'm interested in what was

pressuring it this week. sec rulings? did that have bearing? that the market already know the etf's were going to be pushed? andy: the etf's are going to be pushed for a very long time, sometime the light will come on at that will be a good day for bitcoin. in the meantime, people are expecting long pushes as the market becomes more regulated. the downtrend is a natural force of a cyclical market. it ran up really quickly. and we say it is down its largest him -- largest amount in a five-day slump, it is at the safe level it was at about 20 days ago. so it was a quick run up enter a quick run down, something we will see in the bitcoin place. joe: let's see the gap we have seen emerge between bitcoin and basically everything else. we continue to see that the bitcoin share of the crypto ecosystem shot up quite a bit in 2019. what you make of that and these other projects that haven't rallied nearly as much off the bottom last year, including ethereum? what is going on with that? andy: this is one of the most

exciting things in the crypto markets, increasing the correlation of bitcoin from other crypto assets. -correlation ofe bitcoin from other crypto assets. now bitcoin is developing its own narrative and breaking away from the pack and that will lead to more de-correlation to other assets in the market. all have different use s -- different uses and value propositions and we need to see them move apart from each other. romaine: when we see organizations that have adopted cryptocurrency, they mention bitcoin in some way, it is limited to bitcoin. some derivatives contracts won't be able to be settled using bitcoin, they singled that out, and i'm wondering, do you think that is going to be a difference going forward with regards to which crypto? andy: crypto -- bitcoin is far and away the leader. it is kind of a safe choice. no one gets fired for buying

ibm, the classic cliche, and i think we will see the same thing with bitcoin as well. other assets need to find their own use cases and not compete with bitcoin for the exact same problems they are solving. for a while, bitcoin will be the leader. remember, bitcoin is only about 10 years old. these other assets are much less than that. they have to have some time to mature, just as bitcoin has. havinge: nyse is question ofhis confidence in bitcoin price. does this hinder or hurt the exchanges that are doing by -- doing things by the book with their own regulators? that's why they want this derivative, to have a regulated price for bitcoin, and using it to buy coffee at starbucks. but until we get stability in the price, people are going to be buying it like coffee at

starbucks? andy: i don't think bitcoin is meant in today's world as a medium of exchange. the back news is that it is serving a client base that has had trouble investing in bitcoin so far. large institutions really want to make a bet on bitcoin up or down, and haven't been able to because they can't work with the existing exchanges effectively. so that moving into the space is exciting because it broadens the customer base. it could hurt the exchanges and at the very least competition is good, and may force other changes to expand institutional grade offerings, and exciting concept. romaine: andy bromberg, cofounder and president of coin list. coming up, a bloomberg exclusive with bank of america ceo brian moynihan. he sat down with bloomberg's david westin to discuss recession fears and consumer confidence. this is bloomberg. ♪

♪ time now for a bloomberg exclusive. recession fears continuing to spark a rush to safety, leaving curve to inverturve to for the first time since 2007. bloomberg's david westin sat down with bank of america ceo brian moynihan for his take. brian: when we look into the economy, we see good things right now, and it has been increasing in 2019. we see it based on consumer spending. when i talk about consumer spending at bank of america through august 12, 1.9 trillion dollars was spent by our consumers, on debit and credit cards, check written, -- checks written, payments made, ach payments, one point $9 trillion, up 5.9% year to date through august 12 versus 2018.

overwas up about 8.5% 2017. so 8.5% growth and almost 6% growth. that means that consumer is spending a lot of money. they are doing it across the board, whether it is experiences, going out to dinner, traveling, and the nice thing is they are getting a lift from gas prices coming down, which provides a benefit to spend. they are outspending that and that -- they are out spending that, and that means a boost to the economy. david: are you seeing any backing off of using credit cards or reserving to mortgage that bet? brian: not at all. current charge-offs have been low-end have stayed that way. my team has said, it has got to go back up, it has all-time lows, it has got to come off the bottom, and it has stayed constant. that is because we underwrite well as a company. but with the unemployment rate of 3.5 percent, low claims for unemployment, low 200,000, a number that hasn't existed for

50 years, a nominal number that hasn't existed for 50 years. the average worker is getting paid more and they are making their way through. and if you think about that, that is going to translate into good credit performance on the consumer side. and with mortgage rates now, you are seeing a tremendous kick in production, probably double what we saw last year, and year-to-date -- or rather, month to date in july was up twice, august is even faster. so people are taking advantage of lower rates. that will benefit consumers to be able to save money on mortgage payments, invest in their homes are spend the money doing something else. david: that all sounds encouraging. what happened to the bond market this week? we had the thirty-year set a new record low in yields. you have the yield curve inverting on twos and tens. you have any number of indicators thank something is wrong. what caused this? it is largely outside the united states, and inside the united states it is around concerns about manufacturing. look around the world.

there hasn't been a lot of great news lately, whether it is brexit, which doesn't seem to settle down, europe slowing down , the europe central bank saying we need to slow down, china slowing down, the impact of the trade war across the regions, the need for companies to restructure their supply chains to avoid tariffs, which means they are spending money to just move things, not really spending money producing new products and new capabilities. so that debate, and more importantly, the debate about the debate, the old saying, we have nothing to fear but fear itself, we have nothing to fear about a recession right now except for the fear of recession. that is what is going on. you are seeing a lot of people look ahead and say, if the trade war continues, if this doesn't get solved or that doesn't consult, you can see this finally getting to consumer confidence in the u.s., which is the critical thing to maintain. if business confidence comes down but is still strong, especially small and medium-sized businesses, they are fine. is -- it is just that they are

little more worried about what is going on in the world. romaine: that was bank of america ceo brian moynihan with bloomberg's david westin. now, 40 years of grief. 40 years since businessweek declared the death of equity, how inflation is destroying the stock market. that was august 1979. it is a cover people can't stop poking fun at. the headline was not overwritten. in the story it said, for better or worse, and the u.s. economy probably has to regard the death of equities as a near permanent position, reversible someday but not soon. 's peter coy took a look at the famously bad take this week. he joins us with egg on his face. you did not write on the article. you are working for "businessweek" at the time. how did the article come to be? truth was, stocks were doing badly back then. it was high inflation, and stocks were not turning out to

be a good hedge against inflation, as they usually are. in fact, gold performing very well, diamonds, single-family homes, even stamps were doing well. --cks were felt lining flatlining or going worse. i want to say something in defense of the article. because for three years, that article was correct. caroline: three out of 40. peter: the first three it looked really smart because stocks kept falling and inflation kept going up. and "the wall street journal" made that point, that we were pretty good for a while there. you are right, it fell pretty quickly after that of the cult. ethic the dow was down -- i think the dow was down 9% in the first three months. you look at the chart, and we look pretty wrong, i have to admit, a 7000% return on the s&p. on: can we pull up the chart

how stem prices have gone up? maybe we shouldn't. peter: the article has nice writing, nice reporting. joe: to the extent inflation fears were seen as this permanent anchor on stocks, these days, no one talks about inflation. it is it -- is it a warning to not assume that current conditions will last forever? no one is concerned about inflation right now coming back. did you write an article in april saying inflation is dead? joe: that's going to save you. romaine: i we going to interview somebody about that 40 years from now? caroline: what was missed?

peter: what was missed was paul volcker. i coincidence, paul volcker was named chair of the fed in august 6 of that very year. the cover date on the magazine was august 13. just as we were writing got, the man who would conquer inflation was taking office. it was the tough recession that wrungically caused that inflation out of the system and set the stage for the stock market recovery. caroline: it is a shame he will not be known for that and forever be tied to the volcker rule. joe: well they are dismantling that. line, in the current environment -- peter: i think you made a good point earlier. in the same way people thought inflation could never be extinguished back then, now they

are absolutely conflict -- absolutely convinced deflation is here to stay. and maybe it won't be. caroline: also in this context, a guest at the other day said the bravest thing you could do would be to allow a recession, for central bank somewhere to allow a recession, allow the reset, and the stock market could go off once again. joe: that sounds like andrew mellon, secretary of the treasury in the 1920's. he talked about liquidating stocks, this purging attitude, get all the rot out of the system. peter: i tend to disagree with that. recessions are incredibly damaging to real people, you want to try to avoid that. this.are ways to do they hurt people lives. there ought to be a battle -- a better way to get us out of a rut than to punish people. romaine: we don't have the

issues today that we did back then, but do you see any parallels? we are writing about how not that many people own stock anymore, stock gains are focused on just a few companies. peter: one of the aspects of the death of equities was that there was a drop of 7 million in the number of individual shareholders from 1970 to 1979, companies buying back shares, there was just more emphasis on issuing debt and so on. we see a little of that today. can reminiscewe and find current similarities. peter coy, a great read, thank you. taking it on the chin, not big on your face. coming up, hong kong protests going global. more and the impact, coming up. ♪

♪ in hong kong,

capturing the world's attention, and now tensions are spreading. from candidate to australia, universities have begun hosting protests. joining us now is george friedman in austin, texas. it has been extraordinary. i think it has been 10 weeks, more big protests planned this weekend read people are wondering how beijing is going to react if it escalates further. what should people be playing -- people be paying close attention to? george: the real attention has to be paid to the central committee of china, which we can't see. there must be tremendous pressure on xi to do something, to do something with the americans, and so on. he is not held in high regard this point, i think. police are giving every warning to demonstrators in hong kong that they are coming in. the chinese badly don't want to do this. they understand what it does to their image. they also can't afford to let hong kong a co-op in chaos. they will go in. what is the e --

romaine: george, what is the endgame for protesters now? i'm not clear on what the chinese could do, or people in hong kong could do, to meet the demands of these protesters. well, there is the protesters, there is all the people in hong kong who haven't protested, who clearly don't mind them. if you are in hong kong, you are worried more about just the laws, you are worried about the recession, the global recession a lot of people expect. they are very worried about china's ability to weather it. they don't want to be dragged into china. they have a good economic position outside of it, so you have economic reasons to stay separate. in the chinese wanted to stay separate. they like that it is a source of money, and foreign investment

traveling into china. but at the same time, there is fear that if these cans of laws passed, they will be dragged back into china. hong kong doesn't want to be there. caroline: they seem to be forcing a recession on themselves with the protests, white sadly. i'm interested in what this means for other areas, one country, to systems. when you look at macau and what it might end up becoming, how does this affect generally the chinese policy toward these arm-length regions. chinese -- the chinese cynically agreed to these. it benefited them. it benefited them economically. it benefited them politically. but there is a price to pay, which is, when you run into trouble you want to control what happens in these regions, and these regions don't want to be controlled. there is a perception of china doing extremely well except for this minor trade dispute with the united states. china has not been doing really well since 2008. they have not been solving

internal problems. the economy is not booming. the numbers are not great. so if you are china now, you look at these regions, you worry about their stability, their loyalty to you, and you act. caroline: george friedman, geo a little futures founder and chairman, thank you. at now looks like there is going to be disruption across u.s. airports peered the nationwide customs system shutdown. we knew jfk was flagging this. this is a u.s. airports report nationwide of customs systems shut down. watch out if you are coming through customs at some point today. this, the don't miss fomc meeting minutes will be released wednesday. joe: and the banking symposium in jackson hole, wyoming begins thursday. romaine: i don't miss this, numbers for u.s. home sales come out friday. bloomberg technology's up next in the u.s.. joe: have a great evening.

this is bloomberg. ♪ from the couldn't be prouders

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♪ emily chang in san francisco and this is "bloomberg technology." apple investors seem to be celebrating president trump's tariff delay. elections at risk, u.s. states struggle to safeguard