. welcome to "street signs." thank you for joining us no break through in the latest round of trade talks. american and chinese officials conclude two days of negotiations with little signs of progress weighing on sentiment. robert kaplan tells cnbc that criticism from president trump won't influence how the central bank makes decisions saying he's happy with four rate hikes this year. >> what i'm focused on is making good assessments of the u.s.

economy, the global economy, good monetary policy decisions, without regard to political influence or political considerations i'm very confident we'll continue to do that. australia prepares to swear in its sixth new prime minister in a decade. scott morrison wins a political leadership vote and outlines his first challenges >> to ensure we not only bring our party back together, which has been bruised and battered this week, but that will enable us to ensure we bring the parliament back together, that we can continue to work to ensure our country stays close together thank you for joining us the latest round of trade talks between the u.s. and china ended without a break through. conducted by mid-level officials, expectations for the

talks were low after president trump said he did not expect much progress. in a statement the white house said the two sides exchanged views on how to achieve fairness, balance and reciprocity, while there was no mention of further talks in the statement. the chinese commerce ministry did later say the two sides will stay in touch on the next steps. joining us now is james p. rubin contributing editor of politico, he served as assistant secretary of state during the clinton administration and our own tanya breyer around the table. james, it's been a week that investors hoped for a break through on trade talks the first discussion between beijing and washington in two months, and then president trump effectively pouring cold water on it. let's suggest that any break through will come at a much higher level and it will be president trump himself that makes some sort of outcome or break through on trade

>> i'm confident if there is going to be a break through on trade with china it will come with president trump's direct involvement. he enjoys the process of making a deal the problem is he has not been able to make many deals with the chinese. instead things have gone the other way. we've seen breakdowns rather than breakthroughs if the time comes when china is prepared to make moves, which i think the whole world recognizes that much of the blame for this difficulty will rest on china's practices, whether they be central government practices or actual market impediments, the united states has not made it easy with the dumping of huge tariffs and threats of 200 billion more there's been a wild process for negotiating a trade agreement. >> as karen was saying, would it take -- he's meant to have quite a good relationship, cordial

relationship with xi we saw them together we have seen tell together at mar-a-lago do you think he will at one stage jump in? we're seeing this tit-for-tat that's going on. where will it stop >> with president trump and china there are a lot of equities at stake here at different times. you mentioned when president xi was at -- with president trump at mar-a-lago. the issue also at hand was north korea. he was very interested in getting the help of the chinese to see that north korea would come to an agreement, perhaps make some progress on denuclearization right now i think he probably needs the chinese less because the united states is dealing directly with north korea. that process certainly in president trump's mind has made huge steps forward when president trump looks out there, there are only two leaders he really plays a kind of complicated game of give and take with, that's the chinese president and the russian

president. so i do think that time will come, but it doesn't seem imminent >> it's interesting how you say complicated relationship it's been noted that china can't match the 200 billion worth of tariffs and keep on escalating from there it's running out of u.s. goods to target, but it can stop licensing approvals, make it very difficult for american companies to do business there and there's lots of american companies doing business there isn't that a risk? it's hard to monetize what the impact would be on american corporates if they found it tough doing business in the mainland >> that's the problem with china all along. it's hard to monetize the non-tariff barrier system. it's been a problem that we know that china can make life difficult for american corporations they can make it difficult for them to use their technology, keep their licenses. they can just make it difficult for them to incorporate and get business done there. that's the problem with the chinese market

it's not a fair and level playing field. when things are going well, those things tend to happen less when things are going badly, they will happen more. so i think that that aspect of the u.s./china relationship has been there before and it will be there for a long time to come. >> we'll talk to you more about some of president trump's other problems, james. were you surprised there wasn't a break through with china >> i wasn't. frankly i had not seen evidence yet -- i've been back in washington for a good six to nine months now that president trump has been able to close he talked a good game, sometimes successfully brought parties to the table and surprised people in some cases, in terms of closing, finishing off a major negotiation diplomatically, whether it's with north korea, with iran, chinese trade talks,

whatever the subject, we have not gotten to closure yet. the administration, you know, still has enormous work to do on any of those subjects. >> the market is still con if i fe confident that there could be a resolution, and one issue might be on energy if the chinese took more lng from the americans, it would settle the trade deficit immediately. but it would also help china's blue skies policy to clear up pollution in that country. that's a win-win for both sides. that's what both leaders are seeking. or is it more complex where we have to see a break through on technology transfers >> you're right, the example you gave is win-win, that's the language the chinese love to use when they talk about trade >> so does trump >> so does trump but the trade imbalance that president trump talked about, that he made his campaign about,

that he made his name through, that is far more complicated than a question of adding one new product to the mix there are so many levels of barriers for american companies to operate in china, i think it would be very, very hard for president trump to sort of wipe away ten years of rhetoric about trade imbalances with one product like lng >> we'll leave the conversation for a moment a lot more to talk about >> whether he will still be in office, that's the big question. >> james rubin will be staying with us. a quick check in on markets. we were talking about trade. a lot of investors looking for the language from the fed today and on monetary policy this market bounced somewhat today. the german market is leading the

charge we've got the dax about half of a percent higher much firmer in the starting position the italian market has bounced as well. it's been a challenging one on the back of the genoa bridge fallout this week with all the policies around nationalization and concessions. ftse also improving in the green, despite weakness at the start. the cac is up by a third in france so a strong outing despite some initial caution. let's get into the sectors just a couple of patches of red. utilities, how hold goods, media stocks, food and beverages, very defensive arm at the bottom of the charts basic resources a cyclical play with autos and banks at the top. brexit secretary dominic rab outlined a contingency plan in the vote of a no-brexit deal he said businesses should be ready to pay more for goods and

businesses he also gave advice on how to avoid medicine shortages he added he's confident that britain and the eu would reach a deal before march, but that the government should consider all possible alternatives. >> naturally we have to consider the alternative possibility, that the eu doesn't match our ambition in prag ma ticmatism a we do not reach a deal, but that's not what we want and that's not what we expect. but we must be ready we have a duty as a responsible government to plan for every eventuality. to do this we need a sensible, responsible, and realistic conversation about what a no-deal situation means in practice. speaking in new york, foreign secretary jeremy hunt said that he is cautiously hopeful about reaching a deal with the eu. >> on the brexit question first,

parliament will only accept a deal that is consistent with the letter and spirit of the referendum result, the decision by the british people to leave the european union, that's the on agreement that theresa may and her government have, and we are cautiously hopeful that we will come to an agreement with the eu because we think it's in their interests as well as ours. coming up, president trump hits out at his own attorney general. we'll have more right after the break. can be relentless. tremfya® is for adults with moderate to severe plaque psoriasis. i'm ready. with tremfya®, you can get clearer. and stay clearer. in fact, most patients who saw 90% clearer skin at 28 weeks stayed clearer through 48 weeks. tremfya® works better than humira® at providing clearer skin, and more patients were symptom free with tremfya®.

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the white house continues to grapple with the fallout from michael cohen's guilty plea and paul manafort's guilty verdict as tensions rise between president trump and the department of justice. trump took aim at attorney general jeff sessions accusing him of never taking control of the doj. sessions fired back saying they would never bow to political pressure tonight fighting back after president trump escalated his attacks against attorney general jeff sessions this morning >> i put an attorney general that never took control of the justice department, jeff sessions never took control of the justice department. >> reporter: sessions lashed out hours later, i took control of the department of justice the day i was sworn in sessions was at the white house for a preplanned meeting today after unleashing the strongest push back yet declaring while i'm attorney general, th actions of the department of justice will not be improperly influenced by political considerations

for months mr. trump has lambasted the entire agency saying it was overrun by democrats. >> with justice, it's a very, very sad day. >> reporter: it's a remarkable inflection point, session was the first senator to endorse candidate trump. >> i'm pleased to endorse donald trump. >> reporter: but once attorney general, things soured after sessions recused himself in the russia investigation because he was a key figure on the trump campaign ever since, the president has excoriated him in a barrige of tweets calling him everything from beleaguered to disgraceful and even missing in action and again today. >> he took the job and then he said i'm going to recuse myself. i said what kind of a man is this >> reporter: while sessions has at times pushed back before, his comments today were the strongest yet. >> it's long past due that the

attorney general stood up for the idea the job of the justice department is not to go after the president's enemies and to protect him and his friends. >> reporter: many republicans on capitol hill warning the president tonight. >> it would be a very, very, very bad idea to fire the attorney general because he's not executing his job as a political hack. >> billionaire former hedge fund chief tom steyer is leading an effort to impeach president trump. he is taking a more aggressive approach to launching a campaign for the white house. he has said publicly he will not rule out a 2020 run for the presidency let's continue the conversation around the set >> james, thank you for joining us this morning. you were assistant secretary of state during clinton, bill clinton's administration so much talk of impeachment, you went through it. do you go into crisis mode now

tell us about those times back in 1998 and 1999 >> broadly speaking as we like to remember, the late '90s were a good time. a time of peace and prosperity, as far as the impeachment is concerned, look there is some analogy to the current situation. if the democrats were to win the house this fall, there's a fair chance that some form of impe h impeachment might take place like it was true with president clinton, the real question is in the senate there you need two-thirds of the senate, and there's been no indication that the republican senators will abandon president trump just like we knew back during the clinton years, we knew the democratic senators were not going to abandon president clinton. we knew this thing was going on. it was gruesome, hard to watch and pay attention to, but we knew also it would not yield a

result that left the president leaving office it was political theater of the worst kind, but just that, theater. >> james, obviously you were living in washington, d.c. at that time. you have now just moved back there. you've been there for eight months you're working with politico what kind of washington are you finding now? >> it is a different washington. obviously the big difference for me as a democrat is that the republicans have control of every branch of government, house, senate, president, and increasingly seeing the courts have republican flavor so the democratic views can be shouted from the rooftops but have little meaning. i'm now working as a lobbyist, so i will say the republicans have a more natural comfort level with lobbyists than democrats do certainly the team i'm working with are able to help me and my work with the government of

mali, syria, having a free election in the congo, things i believe in and republican presidents have a particular comfort level with the lobbying structure as it is now for me i'm lucky to be there at this time. >> what will happen to him look, jeff sessions who we saw endorse him, he actually endorsed him, they're fighting tit-for-tat, he's hitting back what will happen to trump? will his core supporters still be there for him what's going to happen in the midterms this is a gift for the democrats. what's happening where are the democratic stars there's no one there >> well, certainly it's not obvious who the leaders of the democratic party will be we're going into 2020 election it's not obvious at all. you see new names cropping up. you mentioned one a few minutes ago. i would not begin to speculate

on that. as far as what will happen, i still have not seen indication that president trump has lost the support of key republican senators as a group. until that group changes view, nothing really will change othei mentioned to you it's possible the democrats would win the house, if they d it's possible they would impeach the president in some form or another. what i don't see happening is any evidence that the core supporters of president trump will give up on him and thus he will remain as president for the four years of his term >> let's talk about some problems then, when it came to foreign policy and leadership on international issues, president trump showed himself to be isolationist, tariffs being erected on climate change, pulling out of the paris climate

accord, now more eventually and particul eventually, tackrecently, calli out the fed, talking about jeff sessions and why did he recuse himself, questioning the independence of the department of justice, isn't this negative to the long-term future of the united states which has always had strong institutions? >> when i travel abroad and am faced with questions like this, it's troubling i used to be a spokesman for the united states, i used to like to emphasize the positive it's thoohard to do that now. the things that america led the world in creating and making sulk susf successful have taken a serious beating under the current administration there's no question we are

looked at differently and we will be treated differently for a long time to come. >> some might say so what, what are the ramifications, but the ramifications is that it impacts the sustainability of long-term growth because there's not buy-in by the population there's a level of uncertainty that can impact long-term growth for the united states at a time when the bull market looks to be rolling over. this is a real risk internationally and domestically >> internationally it's a real risk the word of the president, the reliability of the president stands behind a whole structure of treaties and organizations that have brought us a stable world for the last 60 or 77 70 years. in asia the wars have ended because of the treaties, alintss a alliances and confidence, and that comes from the confidence

of the president so i'm worried that loss of confidence in the president's reliability can have long-term damage >> will he pardon manafort what will michael cohen's guilty plea mean? will cohen sing like a canary? >> wow i suspect they're thinking about pardoning paul manafort. but my guess is that's not likely to happen because paul manafort came across as such a rich man's thief basically the charges were about him stealing millions and millions of dollars from the government, from clients there's nothing appealing or nothing honorable about paul manafort so i would think president trump's advisers would be urging him strongly not do that >> except he didn't break. >> no. that's what he was saying. he was saying well done

manafort >> great to see you. thank you very much for coming in >> thank you let's take a look at a big corporate story. shares in alibaba pared back early gains after the tech giant reported a fall in first quarter earnings that missed expectations net income for the period dropped by more than 40% on a one-time charge from the re-evaluation of the firm's financial services affiliate revenue also jumped by about 60%, it was boosted by strong perform the man at alibaba's core commerce unit for more on the impact of alibaba's push into bricks and mortars stores, head to cnbc.com a source tells cnbc that apple has hired tesla employees for a secretive autonomous

driving program and other initiatives. stock price growth helped drive the wave of departures apple did not immediately respond to requests for comment. in a statement tesla said it wished employees who left for apple well adding tesla is the hard path. for more on the race between apple and tesla, head to our website and cnbc.com. coming up, australia's incoming prime minister promises a fair go for everyone in his new administration more on that when we return. your brain changes as you get older. but prevagen helps your brain with an ingredient originally discovered... in jellyfish. in clinical trials, prevagen has been shown to improve short-term memory. prevagen. healthier brain. better life.

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so now you can eat tough food without worry. fixodent and forget it. welcome to "street signs." thank you for joining us no breakthrough in the latest round of trade talks. american and chinese officials conclude two days of negotiations with little signs of progress weighing on sentiment. dallas fed president robert kaplan tells cnb that criticism from president trump won't influence how the central bank makes decisions saying he's happy with four rate hikes this year.

>> what i'm focused on is making good assessments of the u.s. economy, the global economy, good monetary policy decisions, without regard to political influence or political considerations i'm very confident we'll continue to do that. australia prepares to swear in its sixth new prime minister in a decade. scott morrison wins a political leadership vote and outlines his first challenges >> to ensure we not only bring our party back together, which has been bruised and battered this week, but that will enable us to ensure we bring the parliament back together, that we can continue to work to ensure our country stays close together let me take you to the market action. investors are hot and cold on how to bid up this market. we had more appetite for german

stocks up about a half percent. now over a tenth of a percent, giving back some strength of its gains. the italian market is up what we've seen around the ftse and cac more modest gains. a lot of risk events later on today with jackson hole in focus. investors talking about fed policy, the tightening about the central bank that some put down disruptions in meaning markets and lack of appetite on equities, and whether the end of the cycle is nearing any messages around that are going to be seized upon by investors today on whether to push up risk or take more money off the table. a quick look at u.s. futures as a result there's a mix around trade talks. it's been a disappointing week for resolutions. the market is looking to move into the green at the start of the session. i dare say any market moving events around jackson hole could be key for this market today

scott morrison will become the 30th prime minister of australia. the country's fifth leader in just eight years the former treasurer won a vote against peter dutton by 45 votes to 40. the australian dollar jumped on the news of morrison's selection. the asx was higher, but only marginally in the green. in his first press conference, morrison thanked his ousted predecessor. >> i want to start by thanking the prime minister, he still is, malcolm turnbull i have known malcolm for a long time he's been a dear friend. he served his country in a noble and professional way josh and i watched and worked with him as he has led our cabinet and the achievements we've been proud to serve with him as a government.

whether it's in the economy, all the other areas that malcolm outlined today at his earlier press conference, he's a great australian, he's contributed a great deal to this country, and our party and our nation will be very grateful for his contribution >> just by way of background, scott morrison originally supporting malcolm turnbull a couple years ago against tony abbott events now moving swiftly. turnbull's tenure was a few weeks shy of a three-year term but the stinger of an early defeat was fresh speaking earlier this morning the outgoing prime minister described the week as madness. >> there was a determined insurgency from a number of people in the party room, and backed by powerful voices in the media really to if not bring

down the government, certainly bring down my prime ministership it was extraordinary itdescribed as madness by many blackrock launched a number of emerging market debt funds with environmental, social and government factors joining us is julia pellegrini a portfolio manager at blackrock give us a sense of how these emerging market debt funds work. >> yes we launched four new funds they're focused esg funds, emd funds, they focus on emerging market dead. they have both a positive and negative screening approach.

we aim not to invest in sudden activitiies and we aim to give incentive to improve performance and to behave better in the marketplace by giving them a higher weight in the portfolios that we manage. >> some investors may be cynical about why debt has been issued one feeling is that it's easier to issue debt than equity in this type of environment that's another example of the debt markets at the moment >> well, we are seeing a lot of demand for this type of investment we think it's good to really use this positive momentum for investors that have an interest in emerging markets debt they want to combine sustaina e sustainability and performance you want to get that yield and get positive behavior by giving

incentive to investors that perform better from an esg perspective. we think that's a positive approach to take >> we know not a lot of large insurance companies have an esg mandate, they're seeking out investments in that area for the long-term, but who is the natural target for this type of product? is it companies and funds across the emerging market space or that developing market looking for em and green exposure? >> we are seeing a lot of interest across the board. a lot of interest from large institutional investors but also retail clients are approaching us the interest comes from a diversified set. a lot from continental europe, but also interestingly from east asia a lot of corporates out there approaching the debt capital markets, investment banks to try to issue new bonds that will

make their way into the indices so capture the new investor base that is looking to combine performance and sustainable investing. >> timing is everything when you bring a new product to market. what stands out is a complete anti em sentiment in markets people do not want to be exposed to em because of a tightening liquidity retrieved by the fed and a lot of tral bacentral ban. how hard has it been to push an em bond in this type of environment? do you think it would have been easier if things were positive around em? >> we are proposing something that has the diversity of the em debt space, at the same time allows you to position in credits that perform better from an esg perspective if you take the standard jpmorgan and global diversified returns over the fast five years and you look at the comparable index, returns are on par. in fact during the period of the

bear market from mid '13 to early 2016, the esg version of the index performed modestly better you have the opportunity to potentially contain that draw down >> right we know all emerging markets are different. that's been one of the common themes in investing in emerging markets. you need to look at individual countries and stories. esg is very different in these places india is advanced on esg how hard was it to have an even spread of esg exposures across the countries? >> it's again the opportunity that's afforded by emerging market debt. it's a diversified asset class so you can afford to screen out areas for you and your portfolio, tweak your portfolio according to your esg considerations >> who is particularly good at esg? >> we have seen for example in this new indices the countries

that gain a higher weight because they perform better in esg terms, like croatia, panama, poland others that perform less well are lebanon or a nigeria so you have a tweaking in weights of those countries >> fascinating conversation, thank you very much. best of luck with the products >> thank you premiere league soccer teams in england often dominate the sports headlines but one club o outdoes them when it comes to the environment. the rovers play in the fourth tier of soccer and have been recognized by the u.n. and fifa as the world's greenest soccer club adam has more >> forrest green rovers who play in league two in england, they

are the world's greenest soccer club they have been catching the attention of the san francisco 49ers and wembley stadium who also want to hear a bit more about their message. i went down to visit forrest green to see exactly what they got going on there including solar panels and robot gardner far away from the super stadiums of barcelona's neu camp and wembley stadium in london, here you will find soccer done another way. the new lawn is home to forrest green rovers, officially the world's greenest football club located in england, they play in the fourth tear of english football they're top of the table when it comes to being carbon neutral as recognized by fifa and the united nations, and there's clear, clean energy evidence all around the ground. solar panels

wind turbine electric car charging points and a robot gardener who looks after the world's only organic, vegan football pitch >> it's all electric it's gps mapped, so we can track where it goes. it's all fed off the solar panels i think it uses about 1.4% of the solar panels >> away from the pitch, the club is totally vegan and the food has the seal of approval from the vegan society. >> it is not meat, but it gives that vibe of football food >> fans heading here don't get the chance to have a meat pie or a greasy hamburger, instead it's a far healthier football feast it's a vision that comes from one of soccer's most unique chairman former hippy turned clean energy millionaire dale

vince. >> today 30% of brthe energy cos from renewable energy and veganism has become a popular thing. this is a great vehicle for getting the message out. >> the ambition of the club is to move up through england's football divisions with their ultimate goal to take their echo friendly message to the next level and move into the world's first purpose-built all-wooden stadium. >> looking to start work on that wooden stadium very soon it's going to be an impressive structure, a world first as well on the point of the players and how they bought into the idea, i spoke to a few of them there, rubin reid who says he is not vegan outside of the club. they're not forced to be vegan outside of the club, but they're more socially aware of where meat comes from, what they put in their bodies, the culture of

the club, they decided it should be something they think about more the other striker started the season well, he's become they're all-time record goalscorer he said he had his best career at the club. so footballers, you think they may not necessarily have a more wider social conscious, clearly they're thinking about things more than you would imagine. >> sounds like the investment community, it was quite a hard sell on some of these principles, then all the performances started to come through the funds, and they've done particularly well how hard would it be for a team like this to recruit and say come join our vegan club >> i don't think it's hard at all. the way they put forward their message it seems appealing they don't necessarily market themselves as the vegan football club or the green football club, but at the same time because of the model they have going

forward, it comes down from the chairman it's all about dale vince. his eco strategy company has brought attention to the area any way. it's a small community there it's probably more a rugby country. but at the same time they have come up through the nonleagues they're into league two, they're catching the eye of wider organizations, they're targeting playoffs this year, that means they would be one step closer to their ultimate goal, the championship that's one step below the "power lunch. so it's a case of forrest green deciding that one of their things they have going on as well as the football and also the greenest club. if they can marry that together, they think they're on to a winner >> interesting story appreciate it.

if you want to see more from forrest green rovers, the world's greenest soccer club, head to cnbc.com for an extended version of adam's report. jerome powell will deliver his maiden jackson hole speech as fed governor today in the shadows of president trump's criticism. more when we return. man: are unpredictable crohn's symptoms following you everywhere? it's time to take back control with stelara®. for adults with moderately to severely active crohn's disease, stelara® works differently. studies showed relief and remission with dosing every 8 weeks. woman: stelara® may lower the ability of your immune system to fight infections and may increase your risk of infections and cancer.

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trade concerns, economic growth and central bank independence are topics that are expected to dominate the jackson hole symposium speaking first on cnbc, robert kaplan addressed the trade tensions saying while there's been little impact to date, ceos are concerned. >> so far the actual impact on overall economic growth i think is modest. i think if this widened or was extended i can tell you i talk to about 30 ceos of month, we do expensive surveys. it is having some chilling effect on ceo's decisions to

spend on capex he also talked about the criticism from the president about the federal reserve. >> i think our job, though, and what we'll be focused on and what i'm focused on is making good assessments of the u.s. economy and the global economy, good monetary decisions again without regard to political influence or political considerations and i'm very confident we will continue to do that. >> janet henry joins us from hsbc welcome. good morning >> good morning. >> it's been an interesting 12 months last year at jackson hole, jelen was p janet yellen was preparing to give her speaech. now what does the fed do do they try to distance themselves from trump?

>> i think they do i think jackson hole has a separate agenda. a lot of these subjects are not on the agenda. we'll talk about those but in terms of the structure of the next couple of days, it will have the opening comments, those will be from jay powell this morning, i think he'll be balanced, even-handed, he won't get involved in political debates, for the next six months there's little divergence from the fed. i don't think he wants to send a strong signal about change in direction of policy or make any strong political statement in these speeches over the next couple of days >> it does get political if he weighs into trade. one story around the growth story was around trade

if he leans into that too much, that's a negative message against trump,isn't it >> it is trade is not specifically on the agenda one thing we know from jerome powell's past speeches, he's not covering a bag of issues in any speech, from financial stability, to the interest rate, to the yield curve, and indeed he so send a message on trade and about risks to the growth outlook. won't necessarily impact growth over the next several months f we continue to see deterioration, that will certainly alter the outlook for growth and inflation dynamics. >> the markets are watching comments on emerging markets, the havoc wrecked on some of these markets as the fed has been tightening. the former head of the indian central bank will be attending, someone who has quite a good voice on the international platform what tone do you think we'll hear from the fed?

will be the federal reserve for the world or for the united states of america? >> it's the federal reserve for the united states of america, but of course they are well aware that development elsewhere in the world will impact on the u.s. economy and can impact on the u.s. economy in the form of inflation. of course they can't impact global developments, we've had plenty of instances in the past when it has even altered the course of fed policy i think in terms of the discussions over the next few days, i don't think we'll be making it on the fringes, but there won't be a lot on the agenda that relates to emerging markets. this joackson hole gathering, there are not many central bankers on the agenda for the next several days. it's more about leave the controversial statements to some academics producing the papers related to technology, banking

structure. if there's anything it may be on the balance sheet. that's where we could hear emerging markets come into discussion the third area on the agenda is banking policy in terms of the u.s. impact on policy, that impacts what the fed does the next few years where we may see relevance for short-term market views. >> a lot of musing around inflation, what the united states is looking at you have record lows on unemployment, but not much of a wage growth story playing out yet. workers are not having the ability to press back too hard against employers to raise wages because technology and automation comes into the mix. will that crop up? will the fed have a handle on those implication for inplaflat in 2018? >> i think that's item number two on the ayend dgendagenda

so far jay powell's said low unemployment may not have such a big impact on inflation for the reasons you mentioned. >> we had james bullard on recently, he thought the phillips curve was broken. >> it was never as strong as it is sometimes painted there is general agreement that unemployment, changes in unemployment no longer have such a big impact on inflation. one thing jerome powell has argued, as the unemployment rate falls, and falls below 4%, the likelihood of workers being encouraged to come back into the labor market, even some of the structurally unemployed start to find jobs, that can improve some of the growth potential. but technology and inflation dynamics is going to be one of the main things that comes out of this jackson hole >> thank you for helping us set the scene today. janet henry from hsbc.

we have plenty more to come from jackson hole. hawaii has been battered by hurricane lane the storm which has been downgraded to category 3, caused strong winds and rain and flooding and landslides. jay gray is in honolulu. >> good morning. yeah downgraded, but the conditions still expected to be severe. we've already seen massive flooding on some islands here. the waves causing some problems with storm surge the wind has been dramatic at times knocking out powerli lines right here on honolulu, not severe to this point the surf has been growing for hours, by no rain right now. that's the big concern the system slowed down a bit

it's wobbled veered from the track. with that slowing we don't expect the worst of things here until sometime late tonight into saturday morning once those conditions get here, especially the rain, that's the big concern with this hurricane, it could continue for 24 to 36 hours. the system, as i talked about earlier, slowed down its forward track and it's moving slowly, 6 miles per hour at the last report so that driving rain is going to cause the biggest problem. it will cause massive flooding in several areas in fact officials here saying for those riding it out, make sure you have food, water and medicine to last 14 days that it could take two weeks for the water to recede and teams to get in there >> thank you, jay gray that's all for today's show. i'm karen tso. xfinity mobile is a new wireless network

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it is 5:00 in washington the federal reserve is the big focus, wall street and your money today. jay powell speaking in jackson hole today. and a major shakeup in australia. the prime minister ousted from office hawaii on high alert hurricane lane bearing down. we have a live report from honolulu. china upping the pressure on america. trade talks fizzling out what will that mean for your money? and we are rounding out our week-long series of america's top fund