is this a sign that blackrock is starting to worry about what is sees in parts of the bond market?i think you have to separate two things out. one, blackrock is an asset manager. we're constantly managing portfolios, the markets are volatile. we have to adapt to that. we have a great risk team and we're constantly looking at ways to stress up our portfolio to stay on top of overall risk. in regards to the market itself, you've seen gdp has continued to improve. you've seen with the help of labor improvement, inflation has come off its lows and starting to stabilize and you're now at the point where the fed is getting closer to move. and we don't think that's in june but it's starting to come up with september or in the first quarter, you're at a point in time when the bond yields are going to start to move and come off the lows. >> i think the implication of the story and many others are talking about these days is that, you know, at least in blackrock's case, putting those holdings through sort of worst-case scenario kind of outcomes. is that fair to say? and, if so, what does tha

blackstone and blackrock are eyeing each other's line of his miss. -- lines of business. me is jason kelly, he wrote about this rivalry in this month's bloomberg markets magazine. why are they getting closer? firms thate are two were once part of the same company, once part of blackstone in the 1990's. he andlit up because steve schwarzman had a disagreement over how they should pay people. they were on these parallel paths ever since. what's happened is, in the new wall street where people are ,ooking for new areas of growth they're looking for new investors, both of them want the products the others have. mark: they're always sing companies are looking for synergies. what are the synergies here? really come toe dominate the world of alternative investments. private equity, hedge funds, real estate, they have put a lot of distance between themselves and carlisle and others. retaile looking at investors and they want a piece of that action. on the other hand, blackrock sees institutional investors who want those higher yield investments like private equity and hedge funds

geraldo rodriguez joins us from blackrock. -- gerardo rodriguez joins us from blackrock.g to u.s. dollars, it has actually beaten the s&p. few people know that. gerardo: for the next 10 or 15 years, the reform agenda, they have been able to pass through congress on a competition, on energy come on telecom. they actually are changing the landscape. tom: what kind of markets are mexico, reaching a velocity on an emerging market, to a less emerging-market, to a developing economy? gerardo: mexico has been dealing with economic realities. it is a story for the next 10 or 15 years. then there is the cyclical story, which has not been that positive for mexico because mexico, given its conductivity through trade to the rest of the world, the lack of export growth momentum has hurt mexico. so a growth projection provides down for three years in a row. right now it looks like we are at the bottom of the cycle, and the next set of news hopefully will -- tom: it looks like the story of resilience. -- the story of brazil. brendan: in the last year manufacturing output overtake oil ex

big investors here, blackrock one of the biggest.parently there will be a limited impact his grace exits. that is something euro leaders are preparing for. there is no shortage of issues on the agenda as china and the u.s. meat for their annual strategic and economic dialogue this week in washington. the challenge may be finding topics on which they can agree. closer engle's takes a look. stephen: a lot of powerful powwows going on on monday. where did they start exactly? a long laundry list compiled over the last few years, cyberattacks the u.s. claims against china, south china sea disputes, transpacific partnerships with -- without aib, illegal trade of ivory even said to be on the agenda. oh yes, human rights, terrorism, intellectual property rights violations. they have been pushed on the list on the agenda. the most vexing strategic us is -- issues are said to be on the agenda monday morning in washington dc. there is quite a list. this is what a former u.s. diplomat and nixon's former translator during the 1970 to visit, he sa

blackrock's chief investment strategist.e a critical look at that book that everyone here in new york city is talking about. the lives of some of wall street's biggest hitters but our own megan mcardle is a scathing review. stephanie: you are looking at sunny new york city and in our next segment, we will talk all about this town. it is a book that has been making waves among more than just new york's wealthy. "primates of park avenue" a memoir authored by wednesday martin. it might viral after it brought to light incidence among manhattan's elite, like retards spins paying their stay home -- like a rich husband spaying their stay home wives bonuses. but many found falsies -- fal sies? -- fallacies in the story portrayals. bloomberg's own megan mcardle was no different. she writes, "martin says she telescopes certain events to protect the privacy of certain families. does this matter? yes, for a few reasons. the first is the stubborn journalist at the that the minor details have to be right, too not just the big picture." me

we are with jeffrey rosenberg of blackrock. stay with us on the bond market and much more.his is "bloomberg surveillance ." good morning. ♪ "bloomberg surveillance". let's get to the morning must-read. this is so good from a few days ago per it i thought we had to resurrect it today. lori stiglitz, you know what he is going to write. -- laureate stiglitz, you know what he is going to write. jeff rosenberg is with us from blackrock, and the professor's major issue here on a network basis is all of the benefit was convergence. we have gotten the opposite, which is the virgins. jeff: the greeks for example all the periphery, got access to low-cost funding. the problem is, what do they do with the low-cost funding? there was a binge of debt issuance and leveraging because you could borrow it at rates that were not really reflective -- tom: with you living there, did it make a deal that it was the euro mark versus germany? brendan: it was a combination of the word in german for expensive and euro. we are talking about the periphery, more money coming in. that money came from oth

let's bring back the global chief investment strategist from blackrock.t was about chinese authorities walking a tightrope. people from the left and right are trying to refocus the economy, do they make it? >> in the financial markets we all move towards the inner -- interim nationalization of currency. by the way, i think we should use the word bubble that is what it is. we are seeing it deflating quite rapidly at the moment. this is a classical sign of the sort of market the biggest ipo this week was a securities company. the turnover has been twice that of the new york stock exchange. jonathan: when you look at some of these ipos, they are just a value of bids that you locked up. they lock up 200 billion worth of bids, do you think the ipo story has drained some of the market? >> absolutely. i think richard is right in saying to support the stock bubble would look like the government is backing up mates. jonathan: is that the physician already? >> i think so. you cannot have the rising like this without a lot being done by people who do not have the mo

blackrock and all of these other fund managers need to assess how risky their books are, and their olde not working anymore? markets, thinkan about what happened. mario draghi announced the euro stimulus of ram which was unprecedented, taking benchmark deposit rates down below zero. this is very difficult to comprehend. people are basically paying for the privilege of having their money in a bank. this offense models in their own right. when you have yields at such low and the negative levels, the high volatility is substantial. there has been very little room for error here. that is part of what has changed. the other thing that has changed is these programs are working. you are starting to see inflation take up in europe, time to see signs of inflation in the u.s. although with today's data it has been somewhat spotty. the federal reserve is expected to start hiking interest rates this year. this has all painted a scenario that has left a pretty choppy bond market and the expectations that that choppiness will increase in the months ahead. scarlet: european qe came after u.s. qe. mon

lines have become so extreme that even lack rock is rewriting -- blackrock is reminding -- rewritingdels. elson wrote the story. scarlet: you are here to help interpret it for us. when quote in the story which kind of encapsulates everything market "the german bund is incalculable." ds are the u.s.n version of the treasury market. they set the tone for borrowing costs for companies and people looking for mortgages. if you have extreme volatility in this market, it creates a possibility for ripple effect to other markets in the area. how do you calculate it? do you just throw up your hands and say, oh well question mark you cannot do that if your job is to manage money. areanies like blackrock changing their models to account for greater volatility, particularly and the longer dated debt, as well as new correlations such as the german yields ande treasury how they sort of play together. with central-bank dominance, you are seeing some correlations that during stress times in particular, really pick up. pimm: what does this tell you about the validity of the models in the past if they

alix: we have seen blackrock rewriting how they measure risk. is pimco doing something similar?isks,ook at macro sector, volatility, currency, we also look at concentration risk, then we stress test the portfolio under numerous scenarios, so there are numerous risks out there and we are trying to prepare. alix: mark, thank you. we will be right back. ♪ ♪ alix: "bloomberg market day" welcome back to "bloomberg market day". stocks, the shanghai composite has rallied 144% in the past year, sucking in investors. china is one of the biggest buyers of gold, and 4750 metric tons last year. -- 750 metric tons. knife inock fervor a the heart of gold demand. joining me now is jim steele. jim, so good to see you. shanghais it, is the composite killing gold in china? >> gold has to compete with other investment vehicles, not only in china but across the world. the popularity of paper assets, hard assets, it is an old trade-off. anywhere where you have strong equity market gains tens to detract from old prices. one reason have gold, in case those investments take a turn for the worse alix:.

brendan: one of our reporters in london had a great piece about how blackrock, among other places is part based on what they are describing as volatility in the bund. when you see this movement in the bund it is one direction over the last month. is that volatility, or is it just a perversion to the mean faster than we expected? dean: i thought that piece by blackrock was important because market respondents are responding to the -- volatility depends on your size, how big you want to be in a particular position, and what we learned about german bunds is they are far from being risk-free. potentially it will lead to age or maddock resizing, downsizing of positions, which could ultimately lead to de-risking that pushes prices lower. vonnie: what is backing these positions? all one thing or just general risk in europe? or is it many things to be on what affects you are talking about? dean: i think there is a lot of crosscurrents right now. you guys were talking earlier about the euro not really falling to the extent you would asked acted -- you would expect it to. one of the relationsh

joe: here to discuss all of these things, jim keenan, the blackrock head of u.s. credit, editor,mberg stock michael reagan. thank you for joining us. something else the caught my eye were the buybacks coming in today. talking about the announced buyback of 50% this year, seems like a big number. if you dig deeper now may be a distinction between announced back -- buybacks and completed buybacks. it will not be trivial in the market and turn out to be not that big of a deal. >> it is this kind of shell game that some companies play and then you look act a few years later and they did not really purchase that much. they get an authorization for that, but what the strategist at barclays are saying is that announced the buybacks are actually good for the stock, completed buybacks are better. that the big jump in announced buybacks is basically due to a couple of big names. ge announced a plan to buy back as much as $50 billion in stock, but in 2015 they will only buy back about 8 billion. he is saying that this boom is not necessarily going to buybacks thisted year. o

matt: you look at this chart and you can see that blackrock, as far as total assets under management,oys blackstone. $4.8 trillion to $310 billion. blackstone actually makes more money in profits. jason: on the same basis, about a billion dollars more per year. when you look at how investors are valuing this you saw that huge difference in terms of total assets under management. when you look at market cap, they are only about $10 billion apart. these are firms that are competing, not just for money from retail investors but even in the public sphere as well as companies -- as investors try to ss who they will invest in. matt: you were explaining they are starting to go after the same clients. stephanie: same investors. jason: the limited partners as it were and also the retail investors. blackstone is seen the 401(k) market. they're seeing things in terms of individual investors. blackrock is looking at those profit margins and saying, let's get in deeper to infrastructure investing. they have an alternative business -- stephanie: blackstone seems to make a lot of money doing that. y

angie: black larocque -- blackrock is warning investors that their hong kong treated counterparts offer great value. a near seven-year high. the valuation premium for eight shares has grown to 40%. that is up 2% in november. on track to be the biggest manager of the end -- of yen bond sales. a 19% market share and putting it ahead of morgan stanley. that is despite the slow rate of corporate bonds that the slowest rate of corporate bond sales in 16 years. hong kong is advising residents to avoid traveling to south korea because of the spread of mers. middle east respiratory syndrome has killed seven. it was first reported on may 20. all the cases have been hospital related. angela merkel has demanded urgent action from greece to resolve the stalemate over its debt. speaking at the g7 summit in southern germany, where leaders including barack obama voiced similar concerns over the standoff. hans nichols has more. the g7 concluded without substantial progress. impress upon the greeks the urgency of the situation, at least from the u.s. side. barack obama seem to direct comments at credito

eric: you may have thought that blackrock map and first, but they receive the quota in april the chineseed it out and included that a shares. when i went back and thought about it, the etf that is going to include a shares when it came into the market 10 years ago, it shook things up with a low expense ratio. it is not like vanguard can't shake things up. they also included small caps. they sort of expanded the index in the etf emerging markets have become more correlated with the u.s. market. now you have a shares and small caps and it is going to have more correlation benefit. if you are an owner of a vanguard emerging markets fund which has $70 billion, that a shares will start to trickle in by the end of the year and will end up at a 5% weighting, which is equal to $3.5 billion for julie:. julie: in the meantime, there are already etf that already include a shares. eric: of the next several years, it should go up to 10%. there are etf's way ahead of the curve. julie: cap. eric: this is what most emerging market funds will look like. 20 percent are these. china is so massive that at f

is that the view at blackrock? >> i think so. it started on the trajectory higher. think last week was a good example. you had seven or eight days of on yields gradually declining. equity markets not doing particularly well but settling down, and suddenly you have this doubling of bond yields in 48 hours. that sends ripple effect through the currency market. jonathan: we sat here a few months ago. i remember talking about this with you and then this low back. is this ap period of calm? or is it the beginning of the end? >> we are only part way through this cycle. i do not think bond markets have fully discounted a change that has occurred. we are going to see that in a number of ways. take a look at the bond market. it has dried up completely. people are sitting back and waiting. they think there is still further to go on the retraction. we are seeing the data suggest that might happen. look at these german numbers. they suggest germany is the country benefited most from the weaker euro. i look back and say what a surprise. are we going to end up in a situation wher

for told me carlyle may have to buy a mutual fun to close the gap with asset managers like say it blackrockyou stand with that thinking? glenn: david thinks out-of-the-box all of the time. i think that is his role. we have so much to do right now in our alternative investing platform. we have got more funds to raise. happy investors, more capital to invest. erik: shareholders would be happier if your stock was trading at a that are multiple. that is one of those gaps in valuations that most of us in the private equity world don't understand. you will hear many of us talk about it and yet it persists. one of the reasons it persists as we are a young industry. when you get -- blackstone went public in 2007 and the rest of us look back to our birthdays in 2011 in 2012. we have not had a chance to show the markets what we will do through cycles. what it means when we expect to happen and it happens. there is an understandable give and take that i think will happen over time. the market will understand how well we perform and i expect what i think is a strange gap between traditional asset manag

comments today from blackrock ceo, larry fink.or conference, he told the audience how he feels about u.s. equities at this time. >> i'm not embarrassed for the united states, will they have better returns and other areas -- i do fundamentally, i am not frightened of u.s. equities, there is good allocation. " onlye also said, european equities, but never fall in love with them. and his third point rose 1.9%, again inost doubled the s&p 500. other managers that traded stocks did even better. month, jumped 6.2% last and david einhorn rose as well. these are benefiting from increased mergers and rising chinese equities. it is a california style brawl. mark zuckerberg and other neighbors are at odds to obtain rights to property. they do not want him to build a mansion overlooking his house. zuckerberg's former neighbors say that they deserve -- deserve money and they are suing the developer. there's a trial date for november 9 area watch has a punch allow the problem. are slow to load. to fix that, apple will unload new tools for the a

blackrock is using this. it is the chicken and the egg. alix: that is the question.s for joining us. george, lisa abramowicz, no doubt the conversation will continue. general electric takes one more step shifting to an industrial company. a key part of the transformation is to shed its finance arm. according to people familiar with the matter, they have plans to unload $20 billion of assets in health care -- care. joining us to talk about ge's rick, whosale, follows the company for us for bloomberg news. this really caught my eye. this is an enormous shift for ge, which is basically a bank and wants to be an industrial company. what assets are going down. they are in the process of selling off most of their financial assets, actually and just recently they have hired thanks to sell off their health care finance business along with their franchise finance and railcar leasing businesses and those three businesses are about $20 billion in assets, which is certainly not small, but probably more significant is that with this, they now put essentially all of their u.s. fin

. >> the building is owned by a large subsidiary of blackrock, which said -- we are in close contact with the building's management company and an independent structural engineer is being dispatched to conduct a thorough review of the situation, but many are feeling dissatisfied by the response in the wake of such a tragedy. >> i see these kids all the time and they're just so happy they're in this country with an opportunity, and they were here for -- i feel like our country has failed them. >> reporter: back here live you see the crews trying to get rid of that fourth-story balcony, send been some debris into the buckets. this is trickier because they have to somehow detach the balcony without compromising the structure integrity. meantime the other balconies are still red-tagged meaning people have been ordered not to stand on them until all inspections having done. berkeley police left earlier, just parking enforcement to make sure no one goes through here. once they all completed, hopefully by today, the street will be once again open.everyw >>> our coverage will continue in the

the black -- blackrock started slow.nd one for scoring the eventual game-winning goal is still to come back. game two is saturday. the nba finals begin tonight in oakland. lebron james and cleveland cavaliers take on zachary in the golden state warriors. the two most popular mvps and basketball. james will look for his third championship in four years as they choose their fourth try at all. courier waits for the best record in the regular season. another west tonight. number seven was big in san diego last night. the padres brought the mets for seven runs on the second straight night. william g was the target. james shields threw seven strong innings to remain unbeaten at five and-0. the padres 7-3 when. boren, watching social media this morning. laura: this is how they have trending on twitter. number one hannah montana, miley cyrus edition tape for the disney channel show was released today. i would love to see that. number two,geek pickup lines like do you.com here often. number three, megyn kelly's interview with the

mark: the impetus for this, blackrock ringing someone in? is that how this started?isa: their idea was to make a more aggressive effort in having a role underrating and creating response. you have seen in the past year, capital markets group, many other firms have efforts devoted to contacting companies. only lisa abramowicz can make the business of underwriting bonds interesting. thank you. mark: and make it make sense. this is very copper kidded. lisa: the u.s. bond market. it is a big market. olivia: thank you so much as always. mark: still ahead, a match made in heaven for shareholders? allia: we will tell you about the plants to spin off its dating empire next. ♪ olivia: welcome back. i am olivia sterns. taking a look at some of the biggest laggards in the nasdaq composite today. good afternoon. matt: i am looking at interesting stories today, starting off with green mountain coffee roasters here the current stock is not doing so well, down by 3.5%. bank of america lowing its price target $95 to $117. couple reasons. they will spend a lot of money the2016 to bui

blackrock putting a notice saying a few book back to 1955, the average rate has been about 5%.gs in perspective that even if they hike, rates are still unusually low. sandra: the world is watching because the world bank and imf has urged not to raise rates any time soon. the world bank chief economist say my concern is the signal coming out of the u.s. economy has been mixed. a sentiment i've heard from many economists. nicole: will see if he uses the word gradual for gradually. she is at 14 times. language will certainly be key. we will get you caught up on global markets this monday morning. asia stocks down across the board at the hang seng down 1.5%. european stocks also weak. the cac done a full%, the dax down 1%. u.s. stock index futures being pressured this morning. dow futures falling down 70 points now. lots of insurgency heading into this week. the political environment also uncertain. florida former governor jeb bush will enter the race adding to the deep lineup on the republican bench. he has rolled out the logo and will make the announcement later today in miami. i

olivia: enjoy your conversation fromer with russ blackrock saying essentially that is never made sense. bananas. all of a sudden -- erik: i've got a funny story for you. to anight i was talking investor who called me he was watching bloomberg television and our colleague jonathan ferro -- olivia: love jon. erik: at one point when the 10-year bund got to five basis points, jonathan said, "i'm sorry i have to editorialize here, that is insane." said that that was the cue to sell. olivia: jon ferro moving markets. governor bank of japan for saying that the currency is unlikely to fall further. the yield is down 2%. erik: want to back down a little bit. olivia: my takeaways that jon ferro moves markets more than the boj governor. let's look at what is moving the markets and bloomberg. a suicide bomber blew himself up steps away from an ancient egyptian temple. four people were injured. the associated press is reporting that shortly after the explosion, police killed 2 suspected islamic militants who arrived at the temple with the suicide bomber. it is a southern city visited by millions of

thank you so much, jeffrey rosenberg, the bond genius at blackrock. >> thank you, good to see you.: the legal battle between uber and taxis has hit the big apple courts. state supreme court judge now ordering the city of new york to explain why regulators shouldn't put an end to uber now? can you believe this? it is a disruptive, amazing business that everybody is using, and now what, charlie? >> and then they probably will keep using it in new york city, but there's a good chance that this judge, a state supreme court judge is ordered, compared to the de blasio administration, mayor bill de blasio, the taxi, limousine commission have, to go into court and explain why the way they treat uber, essentially you are able to call up and immediately get a cab, why that comports with state law which says only a person that owns a taxi medallion, a taxi license can pick up effectively a street hail. that is what taxi lawyers have to do on june 22nd and have to explain the uber policy. there is an outside chance, when i say outside, i say a 5-10% chance that the judge at that point will do

tens of thousands of people go to the blackrock desert for the arts and culture festival. bureau of land management which issues permits for burning man festival would like flushing toilets, ice cream for staff and visiting dignitaries. they are threatening to block the event if burning manifest val doesn't comply. >> the demand would be $5 million. any anyone who has been to burning man can relate to those demand. >> water, electricity. >> people in south america are getting a rare glimpse of which scientists say is the largest dinosaur ever found and you know that's big. bones from the titanasaur went on display in argentina. the remains were discovered last year. it'll take years for researchers to uncover the entire thing and it is more than 60 feet tall and 130 feet long. it is so big the museum is building an expansion to hold the record-breaking remains. >> you know they had the con section venter dinosaur exhibit this weekend. >> i know. i was going to try to take my son. >> wonder if they have a big enough room. >> have a great night and great week. take care. >>>

more premium banks like a goldman sachs on the investment banking side, the private equity banking blackrock, blackstone, i bet they have instituted in their own internal it and they're watching their firewall. >> government in the private sector. the banks and the government are actually working very closely. they believe that an attack on the us could hit the financial markets first and foremost. a lot of dialogue going on. charles: there's no question the former world trade center was the target. it wasn't just because it was the tallest building. that was the financial heart of america. matt: yeah. charles: if any these banks have trouble, they could get hilary to help them out. she has no problem with this stuff. allen, where would you look? because to hack is one. matt has talked about it. ross just mentioned it. that's an etf. is there one that stands out to you? >> not to me. it's a hot sector. a hot market. a lot of these companies have big valuations and no earnings. this is a place i'm staying away from. charles: to your point, someone tweeted, what's a negative peg ratio? well, p

meantime blackrock's steve schwartzman warning about the next financial crisis, saying this time theme. we'll bring you the details and get the panel's take when we come right back. hier doesn't happen all by itself. it needs to be earned... every day... using wellness to keep away illness... and believing that a single life can be made better by millions of others. healthier takes somebody who can power modern health care... by connecting every single part of it. for as the world keeps on searching for healthier... we're here to make healthier happen. optum. healthier is here. when you do business everywhere, the challenges of keeping everyone working together can quickly become the only thing you think about. that's where at&t can help. with the tools and the network you need to make working as one easier than ever. virtually anywhere. leaving you free to focus on what matters most. ♪ ♪ call 1-800-royal caribbean or your travel agent today. >>> blackrock chief executive steve schwartzman today warning about the next financial disaster. in a "wall street journal" op-ed he writes "it

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. -- blackrock to talk about the bond market. >> a little more polo on the program.ut. ♪ mark: good morning, and welcome. we are moments away from the start of european treading. let's get straight to your morning brief. -- european trading. leaders give of alexis tsipras until wednesday night to step up the pace of negotiations. they are weighing up a debt relief plan. stabilization in china. we get a fresh signal the manufacturing slowdown is easing. data later. pmi for germany, france, and the eurozone give us the latest on the economy. the new composition is expected to show the third monthly decline. european markets just opening. it's going to be another day of games. caroline is at the touchscreen. caroline: what a day. yesterday we saw a quarter of a trillion euros added to the stoxx 600. ftse 100 up. risk appetite very much in vogue this morning. 48 hours to get what tsipras himself the prime minister of greece calls a viable solution. wednesday the finance minister meets. i set the agenda for the ministers together once again. now our attention must go to t

i am sorry for stanley gita, go blackrock -- stand with you to -- markets on the move.opresident will join us. as the bear market started in bonds, we will do all that this morning. here is the single senates from the book i love -- woud ld amos approve? the book is "misbehaving." important whether you agree or disagree. amos diversity, a founding giant of the police that models and mathematical certitude flat out did not explain the past and the present of our certainty. it was way overdone coming out of the nastiness of world war ii and in the past decades from rochester to chicago, richard thaler has been a staunch defender for the certain crew as he said no, uncertainty matters. thrilled to have you -- did you stay up and watch every minute of the blackhawks? richard: thanks to you guys, i missed the third. trying to get beauty sleep. tom: bring up the quote. the reality of what you do at the booth school at the university of chicago, one thing the nba's learn in the business goal is to think like an economist, but they also forget to think like a human. another exa

if you look at what blackrock is doing and what jpmorgan is doing when it comes to measuring the rookies in this vast riskiness of their bond -- the riskiness of their bond portfolios and to anticipate liquidity and upon bond crisis, it should raise some questions. taste on what we have seen in germany, for example, the past six weeks or so -- olivia: five basis points. erik: some of the biggest money managers are beginning to reevaluate some of the standard measures that they have in using to test the resiliency of their bob portfolios because, as some people have been saying, what you see in the german market is a once-in-a-lifetime event. the question remains whether it is just a once-in-a-lifetime event. if this is becoming the norm, people have to think differently about whether portfolios are worth. today, they could be worth x or tomorrow they could be worth this or this. olivia: i like the hand movements. they have the model for volatility. that is what we will be talking with martin gilbert about. a lot of people say you have the price and more risks with your bond portfolio. nu

olivia: i have seen a lot of economists over blackrock putting out a couple good notes.is not a problem in the united states -- david: some is measured because we're moving toward the economy, the other thing we have got to do is immigration reform. we are running into a brick wall here. we need to get more immigrants. matt: these things fall slightly outside the fed purview. olivia: i was going to say how about raising rates, or should i say lower rates. many say incentivizing the buyback and engineering. david: what we have got, an era of tight regulation and easy money it we have got to easy up a little bit -- ease up a little bit. we are not actually growing the good things in the economy like productivity and we are encouraging everybody to invest in easy liquid financial assets which do not add to the productivity of the economy. olivia: churning out employers. david: if you can stand the work, it pays well. matt: thank you. pleasure to have you here. we have taking economic news. the value of new orders received in may. vonnie quinn at the breaking news desk has n

asset allocation for blackrock portfolio strategies group.elcome to the program. >> thanks. >> let's begin with what you see as the biggest opportunity for investors here. >> the reality is when you look at the second half we have to measure our expectations a little bit. we think most asset classes are somewhere between somewhat expensive and expensive. i think you have to couch your expectations. we do think things like high yield bonds are still a good source of consistent return. equity sentiment, equity earnings revisions have been severely negative. at this point what the fed told us you've got runway to take equity risk here. that said we don't think it's a double digit second half. it's more of a grind it out second half. >> do you agree equities may be expensive, but you are still going to high yield. he is not. he thinks that is also expensive territory. >> it'sto over generalize. i'm not talking about triple-c rated bonds. when you move up in quality, if you go shorter duration that is a safe place to be within the market. you can

on the list there's companies like nike disney google blackrock.nies that are leaders in their field that have some level of brand awareness. does that factor into this discussion? >> it comes down to the cash flow they are able to generate and returns that can generate on there. there is no good will no brand value. what can they earn? that's what our analysts do best. try to figure out real cash earnings. >> if you've been doing this how on that list because we have a three-year time horizon, how are those done? we've been in a bull market. >> absolutely. the recent one is only out for a month. it's got a long ways to run. the others we won three out of four years. growth performance has been very positive. the dispersion has much much lower. >> he hear an etf. >> thank you for joining us. >>> breaking news on hank greenberg and aig. >> it's star international run by former aig ceo hank greenberg and lead plaintiff in the case was decided yesterday. the case being starr versus the u.s. plans to appeal the decision made by a circuit court job thom

asset management and jeff rosenberg, chief investment stat grist forrategist for fixed income at blackrocklding international bonds right now what should i do with them? >> i suspect that the issues with the greek yields has already come and went. we're 14% on the 10-year greek note. we've been uninvolved in international space especially that area for quite some time. you do have some consequential moves out of the key eurozone players -- germany, france and the like that have come off that almost scary seven basis point yield the german bund's traded at. yields are biased higher generally across the eurozone though i think what we are seeing today at least in the u.s. is the massive flight to quality bid that will come back to the dollar denominated markets. we're seeing that in a rally in 10-year. international for us especially the eurozone right now, too unsettled to even touch. >> james, talk to me about that same point if i am ex posed to international bonds, european bonds, what do i do? and secondly what should domestic fixed income investors be prepared for in a time when interes

former deputy finance minister from canada who's done a lot of thinking about these questions now blackrock to respond. thank you. >> good to be here. this paper touches on many of the same things you are talked about in the first presentation the difference is we talk the approach is more from the perspective of formal economic modeling. as we have discussed monetary policy works in part by moving interest rates both short-term relief by setting the federal funds rate to some extent the long rates if you think of quantitative easing having some impact on the global curve. perhaps most importantly all through expectations that if people expect high -- we want to document exactly how large it would be for alternative policy. a form of economic model to figure out the consequences of those changes for macro aggregates and also for developing. compared to the previous papers same question, more applied to formal modeling perspective. the motivation for the paper that goes back sometime. now this is a concern that is very widespread with the recent changes in the economic climate the market i b

that is actually the words of larry fink the head of blackrock, earlier this morning at the same conferencete of international be finance or iif here in new york. it could ultimately be a threat to the financial system and to the economy. weber said regulators need to take another look at this. with the bond market heating up in the last few days around the world, really those liquidity fears are top of mind. >> sara thank you so much. let's talk about the financial system from a participant himself, kevin cummings joins us ceo of investors bank. >> good to be here. >> when you hear axle weber and other weighing in about frozen markets, what does that make you think about? >> the interest rate risk is one of our biggest esgest risks of a regional back. but having a flat yield curve is dangerous to our net interest income. >> what does it do to you guys exactly? if that doesn't move even if the fed raises rates, the curve might even get flatter. >> exactly. and that will cause some pain. on the other side the uncertainty, we've budgeted for the last two years on rate increase in the third an

bench in private equity on wall street in the hedge fund business, people like larry fink over at blackrocklinton. lloyd blankfein, ceo of goldman sachs. tony james number two guy at blackstone, these are major very rich people all worth a billion dollars in their own right for their own. they're not-- it's not koch brothers money, but it's there and she's going to be hitting upon them and not just them their network of other wall street guys. stuart: are they holding back now because they want someone more to the left of hillary to run? >> i don't think -- you know what? no, no larry fink and lloyd blankfein-- the last person they want to run martin o'malley stole a line from one of my columns, he said it point blank. do you want to elect the candidates that are supported by the ceo of goldman sachs? that's jeb bush and hillary clinton. and i'm paraphrasing, but he mentioned the ceo of goldman sachs, that's the last thing. lloyd blankfein doesn't want to be in the news anymore. he got the you know what kicked out of him back in 2009 2010 following the financial crisis and goldman sachs was

. >> because you hear about people like blackrock and larry who's now doing his own work. >> yeah. think of most major shareholders right now. i've probably made 30 shareholder calls in the last few months and not one of them defers completely to iss or glass lewis for their recommendations, they do their own work. i think the issue is the smaller investors and they're overwhelmed. all the news we just saw and the size of annual reports and the complexity of annual reports, it's impossible for a small investor to stwael wade through all of that and have the resources required to make their own recommendations. so i think it is an issue certainly for retail investors, for small investors. but i think the large investors now almost without exception are doing work with come up with their own views. >> what do you think about the quality of iss and glass lewis, the quality of the work that they put into it. again, for the individual investor who may be playing along at home. >> you know i think it's okay. it's gotten better. you know i think it's a boilerplate by nature. i'm not sure