a different yardstick and you would other countries. -- venue with would the united states or europe or japanthey have a very controlled financial system. normally we talk about debt bubbles as though they will burst in some cataclysmic explosion, and i think in china it will be more like it debt balloon, with the air gradually coming out. i think that that would be possible in a chinese economy. i think china will grow more slowly but i don't think it will ask load and cause a financial crisis around the world. joe: we have been taking this economic tour around the world. what is the big story that keeps you up at night? what are we missing? david: how fast the potential growth of the united its economy has fallen. for 50 years, between the mid-19 50's and the economy grew at an 2004, average rate of 3.4% year. in the last decade we went at half that. we had a chronic labor supply problem, productivity growth is low. once we hit full employment, get down to 4% unemployment, there is very little room for this economy to grow. this economy will grow more slowly in 2017, 2019, 1 way or the othe

it is not europe or japan or the u.s. it is china.asically a turn of the working population take away the 700 million people which is a big number, look at the core which is getting older and its fastest rate ever with their one child policy, this is a train wreck and expediting market policy. >> the trees have tops eventually end you were making a point earlier, the rate and speed at which they were doing this, 60% vs. 6% or 7%. that is a great neck pace and hard to maintain without infrastructure you talked about and so i think we will see this cycle and i am not sure it will bounce back as quickly. maria: china was the jewel of the world, whether american companies, european companies, it wanted to be in china because of the population growth. is it no longer representing the growth story for the world? >> no, it is representing a growth story, 700 million people with tremendous potential, hundreds of millions moved into poverty is a tremendous success story but not quite the way it was made. here is what we fall prey to as america

doesn't matter whether it's europe or japan or latin america. hat meet our specific value criteria. what's happening today in europe as a result of the greek crisis is people are scared to be on the continent of europe. they see what's happening with the volatility and disturbances and don't want to be part of it. our view is that these events impact share prices but not intrinsic value. this becomes an opportunity to increase our holdings in quality businesses. >> have to worry about the dollar? >> well the dollar right now being stronger there's two impacts of this. first, when you're holding a foreign stock, that stronger dollar will clip your return. because total return is currency return and local market return. but there's a positive secondary effect. and that is most of these companies will benefit. most of these foreign companies will benefit from a weaker home currency as we've noticed that u.s. companies are being harmed by the strong dollar the converse is true for foreign companies especially those based in kind of export oriented co

longer a frontal war, where we're fighting in the trenches in world war i and fighting in japan or fighting in europe in world war ii now the enemy is blending in among us and they're being radicalized you don't know where it is going to come from. to say we don't know what caused this, on the last day of ramadan, when the public affairs spokesman for isis encouraged people to self-motivate, get out there and kill people wherever you can find them. if you die during ramadan, killing americans or apostates, that you get a special place in heaven and get extra rewards. so all of these things are falling in. this thing is quacking like a big duck. jon: there was, we understand, a marine officer who was able to obtain his personal weapon and did aim at the gunman apparently, police are saying the gunman died from police bullets and not from this marine officer's courageous actions. >> right. jon: you're exactly right. we are now fighting this army that president obama once compared to the jv team. they seem to be getting fairly effective at organizing and exhorting attacks in this country. >> well, if a

but whether it's japan or whether it's europe, whether it's china, the idea of trying to prop up returns markets, whether admitted or not admitted, is going on. the real issue is how far will they go. and if it doesn't work out, and they've pretty much tried to force people that save into turning them into people that invest and take on more risk, if it doesn't turn out well, do they have a moral obligation to help out? you know, is it kind of like a student loan? you know you go to college, but you couldn't get a job, what was the value of your education? you listen to all the central planners, you did what we wanted you to do, you invested in stocks, if the rug gets pulled out, is there going to be a bail-out? is there going to be bail-in? i can't tell you, but i will tell you if you think china isn't committed, if greece could make it five and a half, six years, how long can china try to prop up their market? i think a big milliliter calculatioca miscalculation, i don't agree with everything that's going on. but i don't think it's black swan soup yet. in the old days you used to have

we would not encourage europe and japan over the u.s., but we think the fair valuation does not mean that the u.s. is more or less attractive. we would continue to emphasize buying the u.s. and europe, at the expense of especially the developed markets, fixed income. pimm: we have seen a big energy deal today, markwest and mplx. what you say about the energy situation in the u.s.? should people be buying energy stocks? it is probably too early, and our equity team would agree with that. further consolidation has to take place in energy prices. our research indicates you have to have a sustainable recovery momentum rally in energy prices before you start seeing people willing to take a bet in energy and energy earnings in the stock market. brendan: you are hesitant about emerging markets and asked him, head of the fed move. how could a fed move possibly not already be priced in? who is going to be surprised? there are a lot of people expecting the fed will do nothing this year or will only move in december. i think the consensus on a september rate hike, you can actually see it, but it is quite diverse. there

europe is most interesting and we are seeing japan to europe. caroline: could that be a trend? guest: i don't know whether it is or we have seen an increase in m&a coming out of japan. they have the real boost from yen weakness up until the end of last year. yen is now sort of stalling. caroline: therefore it is now quite an expensive time to be buying a u.k. asset. guest: compared to what they would pay earlier but as you can say financing is cheap and that makes sense. if you look at investment grade bonds in europe, yields from close to 4% to close to 3% you are borrowing at a low level. if you can get cost cutting through you will generate extra earnings. caroline: what other cost cuts articling your fencing? -- fancy? guest: the other area we are looking at is real estate developing in europe. quantitive easing will push up asset prices. because i am optimistic on the recovery and low expectations -- the also the low cost of real effect is an interesting area in places like france and spain and northern italy. caroline: into the eurozone. it has been wonderful having you on thank you very much. jonathan bell.

if you look at the investment in japan or in europe it's entiredly driven by a q kind of thesis. the way you see that is that bad news/good news. i think we see -- this is suggestive of a pretty significant impact on asset prices. and if i can go from there, on that i think where i'm not sure i reach the same conclusion and i'm not sure where the conclusion is. i think it's very difficult to get into the argument of what's the alternative? i don't see a an alternative that would have created something better at this stage. it's difficult to undermine this argument. but to me i think it's maybe another issue of framing the question, which is we take the crisis as given. i mean all of the discussion has been like a crisis has occurred policy has responded what's the impact on inequality? but there's another debate out there, which is lean versus cleaning. should central banks play a role in the buildup of imbalances. the question is was there anything we could have done to prevent or mitigate the buildup of imbalances before the crisis? that's why we are doing a lot of reventing of

or risks that affect non-greek euro zone economies? course europe is not as high as the united states and china in terms of trade relationships with japanut europe is not insignificant. the question is, does it brought about? out --here -- robin broaden out? as far as our colleagues in europe, their view is that it will not spread to contagion risk. it is not like episodes in the past. having said that the negotiation process and the political friction is likely to be prolonged for quite some time. thanks so much for joining us from tokyo. ui from goldman sachs. up next, could greece's capital can kill the health care system? a special report from athens coming up next. ♪ rishaad: we check in on the corporate stories making headlines. yvonne: alibaba is said to be looking for a bigger office in seattle. sources told bloomberg the company is considering space east of the city that could house 100 employees. alibaba currently has 25 staff in seattle and san mateo, california is the head office. shed the pause button on the sale. you may go back on the market if the ceo changes his mind. shares fell 10% in new york. does less sales jump in

the first or second inning here of the european recovery, the unemployment rate is still 11% for the overall eurozone. is 5.3ted states percent. in japan its 3.3%. europe is miles from full employment. i think that it will gradually celebrate but the nice thing for europe is that it could go for five years with the unemployment at that for five years and it would still not hit full employment. a lot of room to run, but as an investor that's a good thing. alix: really over -- sorry, joe, you have a follow-up? joe: no. alix: china has been the topic do sure. -- fddu-jour. that had a huge bump from 2008 to 2014, but debt is increasing. what role does this that play in the government need to prop up it is all a? david: bit mysterious. the problem is that we look at the gdp numbers in china, they look like they are too strong based on what we are seeing in housing and exports. looks like gdp growth is overstated, but that is nothing like the debt growth, the total growth in debt in china is running way above what you would expect given the economy. even when growing this fast. a lot of those numbers do not to im concerned about their clear interest in propp

europe 34%, japan 10%. we think they will follow that. it's up 13% or 0 so in dollars. you can buy in hedge. n, as well. it's a good way to get exposure out there. if china plans to become a special drawing right currency. there's four the pound, yen, dollar and the euro. i find it interesting. nobody made this link. their market peaked out june 12th. june 9th we talked about it here. msci said they are not going to go in the index. all that money was flooding in hoping that the index funds would follow. it did not happen. buy japan and buy the u.s. buy ken mahoney. >> thank you, david. >> bye, gentlemen. >> bye-bye. >> we'll come back with the closing countdown. >> stay with us. the latest on greece and signs they may be capitulating to demands. can you tell what makes them so different? did you hear that sound? of course you didn't. you're not using ge software like the rig on the right. it's listening and learning how to prevent equipment failures, predict maintenance needs, and avoid problems before they happen. you don't even need a cerebral cortex to understand which is better. now, two

are in terms of how much will risk you want to take on, or you know, your age, but give me your sense of allocating capital u.s. europe and japan said we've got greece sort of confusing some headlines there you still think european region is a good place for people's money long term. >> we think we favor u.s., but from valuation standpoint our research team thinks that europe gold markets and japan have opportunities as well. based on valuations, and the their constructive long term emerging markets important long term right now a lot of things going on there that perhaps people wouldn't want to allocate as much to now. >> give me your most important theme that you are communicating with investors today, when new ad campaign the way communicating differently. >> yeah, it is a different world out there. the way that we've thought about financial assets and planning, is different it isn't just about beating benchmarks, it is about working with someone to try to take the money you have invest prudently to accomplish your goals, or mitigate conrns so when that is retirement funding lifestyle for a long period of time that is the fu

europe and japan, which bums me out. olivia: i am sure a lot of people watching this right now share that sentiment. matt: olivia does not. the oil spill continues to bubble up orust meant to go, bp agreed to settle government claims from its gulf of mexico oil spill five years ago. the company will spend 18 point $7 billion. a merger in the medicaid insurance business. c is buying health net -- entene is buying health net. more than 12 million participants. it would have 10 million members and a total revenue of $37 billion. univision holdings today. the us-based spanish-language station recently inked a long-term deal to get content from a group or at least 2030. revenues rose about 11% in 2014 to nearly $3 billion. no details yet on the size of the ipo. those are your top stories this morning. still to come, is there a racket in the sky? american southwest are facing an anti-trust investigation for an alleged collusion. we will get the detail. frommore with an interview the primacy of the said he would sooner cut off his arm before a deal without debt restructuring. output is said to be the highest ever for a fifth straight year and much of it is being dumb

europe. maybe end of loose policy in japan. beginning of loose policy in china. this coordination ork of coordination is going to lead to choppiness and volatility but i think overall for domestically based companies, that's -- >> since you brought up a september rate hike. we talked with richard fisher and he believes that the markets already discounted the first fed rate hike. do you agree with that? >> you only know who is wearing a bathing suit once the tide goes out. we'll know when it happens. everyone can say they're prepared for it. we'll see what sort of happens. i think the question is everyone is prepared for september. i think expectations is below perhaps where the fed is at and that all depends on the overall economy. to tell you the truth, i think domestic u.s. economy is strong right now. >> real quick. you mentioned the opportunity to grab a couple beaten up stocks. seagate down. trinity down 36% over the past year. you like them. >> i like them because they have gone on sale. seagate you get 4.5% dividend yield. trinity trading at seven times earnings. they are goin

companies in new york city or new york state, you invest in companies from all over the united states california and so on and the investment opportunities in the world, japan and europetter than the united states. and now, the investment one is possibly by the benchmark, s&p or the index, you get the good the bad and the ugly the average. then there's active investment that's choosing a portfolio manager 95% of actively managed fun do worse than the benchmark and expensive. and this passes and uses the rules and 200 separate factors around the world. of course the u.s. is doing really well. many markets around the world and emerging markets and should be in your portfolio. >> and you have low cost and actively managed funds and benchmarks. >> you're going to win a nobel prize for that? >> i don't know about that, but certainly it's a smarter way of investing. >> nouriel roubini, i promoted you to nobel prize winner. you don't have to pay taxes on that, did you know that? >> thank you for that. stuart: wednesday, lunchtime, i guess it's lunchtime at the moment somewhere, 1760 where we are look at twitter, the stock of the day, hitting a 52-week low 31 a share on twitt

going in the next ten minutes, ten days, or whatever, but over the long-term,s it's a darn good place to be. >> and japan, by the way. >> japan, absolutely. japan, europe the u.s. the three developed markets play. the emerging market. i agree with joe 100%, they put in real reforms, unlike china, they're not managing all, the entire economy. can you believe the numbers more out of india than you can out of china. too many people i spoke with today being believed that the 7% print on gdp is duly closer to 2% to 3%. there's more money going into india in terms of being a place for investors to go than china. it's the best emerging market out there. >> so many other stocks on the move as a result of what's happened here at delivering alpha. we'll talk about those including macy's which one of the activists investors brought up as his best idea. we'll break that down. i want to get back to our headquarters, steve liesman has breaking news from janet yellen's testimony on capitol hill. >> maybe going a little bit against what gundlach is saying, let's me turn the the mute down on the conference going on. janet yellen saying that she thinks the fed is actual

or at least prevent it from happening in the first place. >> there does seem to be consensus in europe and japan that there are measures you can take to reduce the problem but one of the things we are seeing now is rethinking our approach with a more assertive approach. we've reached the end of our time. i thought this was a great panel. it was really fascinating. was really fascinating. michelle lee, thank you so much. you cut me off before i could think victoria and mike so thank you to them as well. [applause].

or at least prevent it from happening in the first place. >> there does seem to be consensus in europe and japan that there are measures you can take to reduce the problem but one of the things we are seeing now is rethinking our approach with a more assertive approach. we've reached the end of our time. i thought this was a great panel. it was really fascinating. was really fascinating. michelle lee, thank you so much. you cut me off before i could think victoria and mike so thank you to them as well. [applause]. [inaudible conversation] >> on the next washington journal, the hurdles hurdles that are keeping third party presidential candidates from running competitive campaigns. how changes to overtime pay announced by the white house will affect employees and hiring. "washington journal" live every morning at seven am eastern on c-span. during the program he can telus what you what you think by phone and on facebook and twitter. >> also on the house agenda for the week, a bill to make changes to the no child left behind federal education program. it will gather into eastern on c-span. the sena

or at least prevent it from happening in the first place. >> there does seem to be consensus in europe and japan that there are measures you can take to reduce the problem but one of the things we are seeing now is rethinking our approach with a more assertive approach. we've reached the end of our time. i thought this was a great panel. it was really fascinating. was really fascinating. michelle lee, thank you so much. you cut me off before i could think victoria and mike so thank you to them as well. [applause].>> washington journal continues. host: a familiar face to washington journal viewers richard norton smith joining us this money from grand rapids michigan. talk about where things stand on the legacy of the current president, especially in light of court decisions on gay marriage and the affordable care act, the victory in congress over the trade bill, and his recent comments on the shootings and the eulogy in charleston as well. thank you for being with us this morning. what brings you to the grand rapids? tell us that first. guest: i have moved here to undertake my next book, a compre

japan than europe. stephanie: all right. bob talking to us about futures on metal this morning. not much optimism in gold expressed by bob orlly anyone else at this point. thank you. we appreciate it. olivia: jeff saying he thinks gold could go down. time now for the top stories. we will start with apple. apple had a big quarter, a huge quarter, by anyone else's standards. it just was not enough for apple investors. shares are trading lower this morning, as much as 6% in the premarket. the company is posting record third-quarter profit. iphone sales rose by 35%. the issue was the sales missed analyst estimates. sticking with tech, shares in yahoo! are falling in the p market this morning. forecast sales in this quarter missed analyst estimates. marissa mayer has been trying to turn the company around investing in mobile features and video sales in the new areas grew 60% in the second quarter. >> searches half of our business. we have been investing modestly here in algorithmic technology. in q3, we feel the platform was able to take on increased traffic. olivia: yahoo! has benefited hugely from its 50% stake in alibaba. wes

or at least prevent it from happening in the first place. >> there does seem to be consensus in europe and japan that there are measures you can take to reduce the problem but one of the things we are seeing now is rethinking our approach with a more assertive approach. we've reached the end of our time. i thought this was a great panel. it was really fascinating. was really fascinating. michelle lee, thank you so much. you cut me off before i could think victoria and mike so thank you to them as well. [applause].s of online service provider start-ups. later, a look at the u.s. innovation system and the economy. tuesday, a senate commerce science and transportation subcommittee examine new technology toss improve the safety and efficiency of the nation's transportation systems. witnesses included officials representing volvo, amazon.com, bnsf railway and the port of long beach california. this is just over an hour. good afternoon, everyone. i am pleased to convene the merchant marine infrastructure safety and security for its sixth hear technology transforming transportation is the government ke

or at least prevent it from happening in the first place. >> there does seem to be consensus in europe and japan that there are measures you can take to reduce the problem but one of the things we are seeing now is rethinking our approach with a more assertive approach. we've reached the end of our time. i thought this was a great panel. it was really fascinating. was really fascinating. michelle lee, thank you so much. you cut me off before i could think victoria and mike so thank you to them as well. [applause]. >> live at 10:00 a.m. on c-span. and monday governor scott walker is expected to announce that is entering the presidential race. >> next weekend on "road to the white house," two political events from iowa. live in cedar rapids for the iowa democratic hall of fame dinner. it will mark the first time that all five democratic's candidates shared the same stage. then we will be live in ames where nine leading presidential candidates are expected to speak. "road to the white house: 2016 -- we take your." -- you there. >> on thursday they held a hearing for general dunford who is expected

japan as a greater threat than china. or what does it look like in the world when korea unifies? we have seen high tension in europe-- at its highest point of alert because of what if -- what russia is doing there. it's when you look at defense spending, only five nato members have even met the minimal target of defense spending. their overall defense spending has exley gone down in the last couple of years. the point in all of this is become look at these trends, you can look at these technologies, and place it in pathways for. there are multiple futures that might happen. in "ghost fleet" what we do is basically try and run with that and explore one if. what are the consequences of that? and hopefully

japan. maybe those companies gain market share from chinese companies if importers in the united states or in europein chinese companies, maybe it benefits others as well. >> the nikkei closed down more than 3%. but that's been the whole theme of this entire bull market. over the past few years, climbing the wall of worry. and what is it going to take to actually bring this market down in the u.s. in terms of a correction? >> what's going to cause a correction or bear market is what causes it all the time. combination of tightening monetary policy and poor earnings. you get that combination, you're going to get a bear market or corrections. >> you don't think we're going to see poor earnings? this is what happened last night. >> absolutely. that's the issue right now. why has the u.s. market been squirrely this year? it's the combination of earnings not being strong enough. on a reported basis, this is now negative. combined with the thought that the fed might tighten monetary policy. that's not a good combination. >> it's incredible. it's incredible. you are holding people. because we're now down l

japan as a greater threat than china. or what does it look like in the world when korea unifies? we have seen high tension in europe right now. nato as its -- at its highest point of alert because of what if -- what russia is doing there. it's when you look at defense spending, only five nato members have even met the minimal target of defense spending. their overall defense spending has exley gone down in the last couple of years. the point in all of this is become look at these trends, you can look at these technologies, and place it in pathways for. there are multiple futures that might happen. in "ghost fleet" what we do is basically try and run with that and explore one if. what are the consequences of that? and hopefully entertain people. host: >> on the next washington journal, terry jeffrey and elanor clift discussed the current state of the american dream in light of court rulings and race issues. then the term's big supreme court decisions and your comments. washington journal live at 7 a.m. eastern on c-span. >> we are partnering with our cable affiliates as we travel across the united states. join us th

europe? >> no. in fact, they've gotten hammered through the greece thing. and so this really is an opportunity, we think. >> what about japan ore story's a little different there because japanese stocks have done a lot better. but the thing there is that corporations finally are giving more back to shareholders in terms of dividends and buybacks. we think that's in its early stanls stages. so we're positive there as well. >> how would you buy -- if you're an average client of your firm, how do you tell them to invest in europe? what should they do? >> i think buying stock indices are the way to go. >> in europe. >> yeah. oddly enough this is going to sound weird, but i think on a greek exit medium term it would be more positive. this thing has been hanging over markets for five years. and if -- and this is a big if. if greece had exited and europe took that as a signal for faster and stronger innovation in other words let's batten down the hatches and support italy and spain, single banking system, ecb front loads a lot of purchases, i think they would say finally we have an answer here. what's happening in greece is more of t