last september, he joined janus capital and now manages the $2 billion global janus unconstrained bond fund. gross and i sat down at his offices to talk about his new life. we started with the obvious. why, at 71, is he still doing this? bill: one of the reasons that i am still doing this is to prove that i have still got it. maybe like a 38-year-old quarterback that can take his team to the super bowl. erik: to whom do you prove anything? bill: that is my particular problem. thaterstand intellectually not many people care. my wife does, because she has to put up with me at night. it is an obsessive thing that has given me and formed me and helped form pimco. when you get to be 71, erik, even though you can figure it out intellectually, you don't necessarily lose it. erik: surely, you must get there are people that must wonder why bill gross, the most successful bond manager ever, would be doing this? bill: i did not like how i left, so to say, pimco, and i didn't care how the aspersions that somehow i might have lost my touch. i don't think i have lost my touch. i am in this seven day

erik: how are you going to define success for yourself at janus? bill: more by performance than by assets, although i would love the assets to grow. when i came to janus, it wasn't with the intent of creating pimco 2. i recognize pimco 1 took 20 or 30 years, and that was not a realistic goal. it didn't mean that i didn't want to double assets every year, like i did at pimco. i had a reasonable sense of organization and the future. success, for me, would be defined for performance for existing clients. it has always been that way. erik: if it's not going to be as big as another pimco, how big would you like to get to be? bill: i have no idea on that. we have about $2 billion right now, thanks to george soros, who unbelievably called me two days after i left pimco and said "bill, would you like to manage a half a billion dollars for me?" and i said "yes, sir." erik: is there a point to which it comes too big? bill: i think so, with active management. this is not to diss pimco. they have close to $2 trillion. and that's big. other institutions are big

we have a nice set up for our conversation with no gross of janus capital futures -- bill gross of janusres. important headline is yields come in further. this morning, the two-year yield is in 13 basis points from where it was 48 hours ago. that is quite a move. not quite back to crisis moves, but there has been an adjustment in the yield curve. michael mckee and tom keene with you. stay with us. ♪ tom: good morning, everyone. "bloomberg surveillance." we welcome all of you around the world. what an eventful week it has been. markets on the move. brendan: features down after the fed decides not to raise rate. did you know that i decided not to raise rates yesterday? there are individual movers to watch. we are talking to julie hyman. what is going on? julie: i'm glad you let everyone know the fed decided not to raise rates. i may have picked up on that. this is one of the stocks we are watching. the company has completed a share sale. when you have these share sales, the dilutes the value for existing shareholders. nose and her has a completed one when it says it is going to sell more s

bill gross, bond manager at janus capital. he has strong advice for the fed. central bank should get off zero and get off quick. that's a quote. gross said zero interest rates, hurting real economy and destroying insurance company balance sheets and pension funds. fed kept benchmark interest rate close to zero since late 2008. it has to go up at some point. nicole: we're talking about volkswagen. ceo martin winterkorn is out resigning yesterday in the wake of the diesel emissions scandal potentially impacting 11 million cars. the company pledging to prosecute those involved in this scheme but lots of remaining questions. at the top of the list is how to save the company from financial ruin and restore its reputation. that is the task of vw's next ceo. some of the names being tossed around to replace winterkorn? the heads of porsche. up a little from yesterday. lauren: down 29% from yesterday's session. really unbelievable. let's look at your thursday forecast, we have fox meteorologist maria molina joining us. good morning. >> good morning, lauren. looks like

gross manages the $1.4 million janus global unconstrained bond fund. >>> why main street business owners are watching washington very closely. . >>> more than 5.5 million people are estimated to have their fingerprint information stole anyone massive cyber security breach at the office of personnel management. that's five times more than the orange estimate when the breach was disclosed earlier this summer. the agency says it is working with groups like the fbi to determine the potential misuse of that stolen data. >>> at midnight, one week from tonight, the government could potentially shut down. that's when funding for many federal agencies expires. but senate republicans are trying to avert a government closure. amon jarvis has been following developments from washington. what's the senate going to do this week, if we know? and what happens after that? >> i'll tell you what the plan is. what they're going to do is anybody's guess but the plan is tomorrow on thursday, mitch mcconnell and senate republicans will bring to the senate floor a measure that would be a short-term funding meas

. >> to your point on -- when you hear bill gross of janus saying to investors move to near car, almost all cash and then you hear calsters considering moving 20% of their portfolio away from stocks that does seem to signal a belief that perhaps there could be more volatility ahead. >> i think what it speaks to is a sea change. the way people used to think about equities. and you think about the low volatility environment we've been in now for three years really if you think about the 10% correction we had in the s&p 500 was the first time excluding last october, was the first time since 2011. so to me what i see here is a lot of technical damage has been done in a very, very short period of time. and when you talk about sentiment and you talk about some of the biggest movers of assets like you just mentioned, these huge pension funds and pimco or janus, i guess, to me it could signal just a change about how people feel about investing in equities after such a long run. so one and done or they don't do it. i think the fed is damned if they do, damned if they don't in the very near term.

we have a warning from bill gross, janus capital. get off zero and get off now.make of the fed we wait to hear janet yellen? jane: i think the arguments are compelling, but we lose our momentum if the u.s. were to fall into deflation. i and not saying they will but the bigger argument is that if they were to hike interest rates, do they risk deflation? probably not, and from that point of view, yes, maybe he has a point. others may say they have missed the window of opportunity. now to we have these concerns about china and emerging markets, maybe it is going to be too late. think, is likely to come today, and that should restate what she said last week, which is that the majority of the committee do expect an interest rate hike in 2015. anna: the market study really listen to that, did they? they listened more about the warnings. jane: and that is why i think it is likely she will come back. we had a number of fed officials speaking over the last few days, most of them talking about communication, trying to get the message across that the majority were in favor

olivia: the bond king of janus investment out his in for yesterday.fed move miami too little too late -- may be too little too late. carl: it's confusing to say we should of gone sooner while the economy is not strong is too late if it now to raise rates, would probably should've waited longer all the long. -- all along. yet to get a better sense of what the negative feedback is on the latest developments. i still believe domestic fundamentals are relatively decent. and the core engine of the economy is the domestic demand,'s consumer spending, and the job creation happening in the private service sector which is insulated from international development. i think the fed will still get away with a one and done rate hike at the end of this year. olivia: chief economist for bloomberg intelligence. thank you for joining us. still ahead, energy-related bonds have plunged 20% in the past month. do you want to catch a falling knife anchor this spell trouble for the rest of the market? lisa abramowicz joins us next. ♪ ♪ olivia: welcome back. time to get you c

gross,: that was bill from janus capital.livia: still ahead on the "bloomberg market day," -- we are having trouble. has a's migrant crisis terrible cost, but could it have an economic benefit? we look at both sides, next. ♪ olivia: welcome back to the "bloomberg market day." i'm olivia sterns. brendan: i'm brendan greeley. matt miller, what's happening in the markets post job numbers? matt: they are falling. it could be 120% inflation is made the market think the fed will more seriously consider raising rates in september. the s&p 500 now down at session lows off 1.4%. points, thethe 259 nasdaq off a little more than 1%. if we close here, the s&p will lost -- have lost more than 3% this week, the second worst week of the year. over the last 12 days, we have seen six declines of more than 1%. seen january, we've only 10. it has been bad, let's just say. here's the s&p since the u.n. devalue's in china. it let it devalue about 3%. since then, we've seen the s&p fall 8.5%. 469 stocks out of 500 on the index fall. 200 have falle

star that couldn't deliver glory was janus. trailling pain she missed a tough three at the buzzer, greece going down. >> in major league base bam. nick franklin hit a 2-run home run. lifting tampa to a win. wildcard lifting. the toronto blue jays lost 3-2 to atlanta >>> the cities have been named to host the 2024 summer olympics. paris, rome, hamburg and buddee pest will battle. los angeles is the only western participant >>> let's look at the applicants. paris had a failed bid for the 2012 games, which went to london. the french capital has been host twice before, the last time back in 1924. rome, who last hosted in 1960 staged a bid to host the 2020 games, but pulled out because of budget concerns. hamburg never hosted the games, beating out berlin. budapest is hoping to join russia as the only eastern european country to land a summer olympics, and los angeles aiming to land a third game after 1932 and 1984. l.a. was the second choice after boston pulled out at the last minute. the winner will be announced in september 2017

joining us now, bill gross, janus global unconstrained bond fund portfolio manager. a billion things to talk about. bill, your take on the jobs number and the fed and the xh economy. hi. >> the jobs number was mediocre but decent and probably in terms of it janet yellen and the fed, sufficient for either september or december. it's probably on the line. the u.s. economy is chugging along at 2%. that's decent. that's not great but it's allowing for corporate profits to stay at least at flat levels going forward. the u.s. economy isn't bad but there are significant global imbalances as you just talked about with china and emerging markets and their currencies which in many cases are dollar denominated and could lead to problems down the line. and ultimately, last point before i break here, 0% interest rates have for a long time exerted a negative influence on the economy. a positive influence though on financial markets, but they destroyed business models. insurance companies and pension funds, they're all in trouble because they can't earn that 7% or 8% which they've

in the new report, the janus capital fund manager says that if it becomes the norm the economy will runs up. european markets having an interesting session. let's find out what else is going on. jonathan ferro has the details. jonathan: what an interesting morning. own, the attention as always on the dax in frankfurt, down .5%. what week for germany. they lose a ceo and are waiting for friday to see who replaces him. they also lose a third of their value in just three days. here is that move today -- a bit of a relief, the stock up 5.5%. is the trouble over for to vw? that stock, went to keep an eye on. 9:00 a.m. london time, the norwegian central-bank says they will cut by 0.25 percentage points. the norwegian krone was sinking against the dollar, jumping to a 02 high, the weaker norwegian krone. the surprise is not just the rate cut but the dovish tilt, the prospect of another rate cut, the real headline is that the commodity rout is having a serious impact. the economic reality bites the centra, the central bank reacts. mario draghi says the euro is stronger for a second day, down, y

tom: a nice summary from bill gross a janus capital.vernight, we saw china, hong kong pmi, we know those are things a fischer pays attention to. will that matter september 17? should.think it my think any central banker, certainly those of the imf and other global agencies are well aware there are significant imbalances in the global economy. that speaks to not only trade balances, but financial markets and currencies. the brazilian reality just mentioned is still on a real basis, highly overvalued. one would suggest has further to go. these conditions exist in asia in terms of the currency levels. investors are being concerned by the draining of reserves of these countries, china included. how long i can continue. imbalance is everywhere. afterthought or an aftermath of the great recession. tom: what are you doing on brazil? are you out of brazil, do short brazil, or is there an opportunity? bill: it's enticing. you can invest in the currency and earn 14.5% overnight, over a week. tom: that's better than mike mckee does. bill: it does.

we are a few minutes away from janet yellen but let's bring in bill gross, manager of the janus globalrained bond fund. here is my concern about this global worry, if china stays volatile or slows down for months, quarters, or years, does that mean the federal reserve has whiffed and missed its chance because they just said effectively we are beholden to china. >> well, they've gone global, have they not, brian? you know, global conditions used to be number four on their list, you know, behind domestic inflation, behind domestic growth, behind financial conditions, and now it seems to be global market conditions, not just china, i know you have talked about that in the last few minutes, but emerging markets in general and the strength of the dollar which has basically put pressure on those global economies which reverberates back into the u.s. one of the reasons for not hiking i think was they didn't want to continue increasing the strength of the dollar. remember, industrial production in the united states because of a strong dollar basically has been negative for four to five of the

cheryl: that was a direct quote janus capital bill gross a strong case for fed to raise interest rates for that now argues rates near zero pumenruts requirement at r. >> a snap on this one snap is good, hole good high school football kicker needed extra help to get exextra point attempt through upright bounced off referee's headed take hat off the extra point was good, referee not upset. back to you. sandra: thank you. that i guess happens sometimes right? pope francis set to address a joint meeting of congress, in washington later this morning. and joining us now john moody fox news executive vice president authorize of biography of john paul ii great to have you historic visit by pope what do you think so far. >> i think gotten off to a very good start brought trademark warmth beautiful smile seems to infect everybody that see z it he and president obama oishl get along very well together. >> surprises so far. >> i don't think any surprises, that is probably the whole purpose of this, is not to be too drastic not too surprising. >> he really hit the ground running, you know talking a

you would be sworn in on janu y january 20th, 2017, what would you say to the american people in ourallenging thing in this docountry. >> that the games are going to be stopped and she unanimous gans are going to end and someone's going to enforce the law and level the playing field they're tired of their generosity being taken advantage of. i asked them to put the cameras on the people in the audience and i asked how many believe their children are going to be truly better off than them. i didn't see any hands. that's what we need to address. this president has killed our trust, faith and belief in that fundamental american truth was going to be better off than ours. that's what we need to restore and what i'll talk to the american people about. >> so chris christie, no complaints about the debate format. do you think you got enough time? >> joe, no whining and moaning in this camp. you don't win in politics with moaning and complaining. i think we did the best time we had and did great during the seven minutes and i hope i get more of it. i hope the folks are going to communicate t