as a result, the fomc expects u.s. gdp growth to strengthen over the remainder of this year and the unemployment rate to decline gradually. as always, however, there are some uncertainties in the economic outlook. foreign developments, in particular, pose some risks to u.s. growth. most notably, although the recovery in the euro area appears to have gained a firmer footing, the situation in greece remains difficult. and china continues to grapple with the challenges posed by high debt, weak property markets, and volatile financial conditions. but economic growth abroad could also pick up more quickly than observers generally anticipate, providing additional support for u.s. economic activity. the u.s. economy also might snap back more quickly as the transitory influences holding down first-half growth fade and the boost to consumer spending from low oil prices shows through more definitively. as i noted earlier, inflation continues to run below the committee's 2 percent objective, with the personal consumption expendit

we have been doing an investigation into the 2012 fomc leak. we kindly asked you to produce documents in regard to the leak and you failed to comply and there was a subpoena for the documents by which you failed to comply. i would ask, what is your legal authority? give me case law or statute that allows you to not comply with a congressional subpoena? >> first let me say that we have cooperated with the committee. >> no, i have limited time. give me the legal authority you have not to comply for a subpoena? we asked for specific documents and you haven't given them to us. >> we indicated that we fully intend to cooperate with you and provide the documents you requested, but we are not going to provide them now because this matter is the subject of an open criminal investigation by the board's inspector general and by the department of justice. they have indicated to us that it will compromise -- likely compromise their investigation. >> you are the chair. you can read the statement all day long, but i would like to know the legal authority tha

in moving longeron to the fomc's term objective of 2%.rall, consumer price inflation has been close to zero over the past year, in large part because the big drop in crude oil prices since last summer has pushed down prices for gasoline and other consumer energy products. price inflation, excluding the volatile category of energy and so-called core inflation, is often a better indicator of future overall inflation. but it too is running below our 2% objective and has been over most of the recovery. the recent low level of core inflation, 1.2% over the past 12 thehs, partly reflects appreciation of the foreign exchange value of the u.s. dollar during the second half of last year as global financial markets seemed to judge that our economy was relatively stronger than those of many of our trading partners. has pushedr dollar down the prices of imported goods, and that in turn has put downward pressure on core inflation. in addition, the plunge in oil prices may have had some indirect effects in holding down the prices of non-energy items in

we could make decisions at any meeting of the fomc. we have emphasized that if we were to make such a decision, we would likely have a press briefing afterwards and we recently conducted a test to make sure that members of the media and the press understand how technically they would participate in such a press briefing. the chair recognizes the gentle man from missouri. >> thank you. here, thank you. ago, we met and had a long discussion about a number of different topics and one of them was operation show point. i asked if that point or made mention that i was concerned from the standpoint that government oversight reform had this report that they put out with regards to the internal fdic wast showed the going well beyond their statutory authority and duties and trying to limit the ability of certain legal business to do legal business and was impacting a lot of thanks in a negative way. the fact that you oversee some of those banks as well, i felt you should be pushing back. i asked you to do that. have you done that? >> yes, i have

basically that the market, the fomc was sort of neutral on this. was still in june aware what the story was, what was happening in greece was not new. at that point the fomc still judged they would go ahead with rate hikes sometime this year. but she did hold out this idea, look we're going to be watching this, if this thing were to deteriorate, it could definitely have an impact on policy. one thing on the dodd-frank report or on the flash crash report. she said it could be regulation. and then she was questioned very strongly by garrett there. this notion did you look at regulation specifically and she was kind of on the fence on that issue. so clearly, congress zeroing in on the flash crash and whether or not regulation and dodd frank had an issue there. carl? >> she did say on the list of things. >> that's right. >> steve thanks for that let's get back to the questioning on the hill. >> a few weeks ago we met, had a long discussion about a number of different topics. one of them was operation choke point. and i asked you at that time or made me

the fomc preachesthe fomc preaches the policy is data dependent the obama tell us what date and now. following mantra policy convention's with the power to amend it or deviate from this in no way interferes with the fed's monetary policy independence. accountability and independence are not mutually exclusive. next we in congress would be grossly negligent if we did not engage in greater oversight of the federal reserve system. dodd frank and 1st sweeping new powers on the fed to regulate and control virtually every corner of the financial services sector of our economy completely separate and apart from its traditional monetary policy role. yet too often the fed appears to shield these activities from public view improperly cloaking them behind monetary policy independence second the fed has now employed a historically unprecedented massive pop-ups let's credit markets are paying interest is on excess reserves and keeping interest rates near zero. zero. the fed has blurred the lines between fiscal and monetary policy. the fed has recently crossed the line by willfully ignoring a law

we use the long run for the fomc numbers.ry key point here which is potential growth. in the long run the fed staff sees potential growth below 2% down near 1.8% whereas the fomc sees it above 2%. i want to show you the all-important funds rate forecast for the fed staff versus the fomc. you can see the fed staff is below down towards 3% 3.2% in the long run there. for each year that we have information for, the fed staff looks for a lower funds rate than the average of the fomc. >> with all due respect to the hard working men and women of the fed, they haven't been spot-on. >> can i correct you? we know what the fomc officials have forecast. we don't necessarily know that the fed staff has been been quite as wrong as you think. >> you're not correcting you're differentialing -- >> between the fed staff and fed leaders. there's been some research by roemer and roemer who you know the roemer husband/wife team that shows the fed staff has the best forecast out there on the street. that's something to consider. >> did you just i

the projections of most of my fomc colleagues indicate that they have similar expectations to the likely path of the federal funds rate, but again, both the course of the economy and inflation are uncertain. if progress toward our employment and inflation goals is more rapid than expected, it may be appropriate to remove monetary policy accommodation more quickly while if progress toward our goals is slower than anticipated, then the committee may move more slowly in normalizing policy. conclude, let me briefly place my discussion of the economic outlook into a longer-term context. the federal reserve contributes to the nation's economic performance in part by using monetary policy to help achieve our mandated goals of maximum .mployment and price stability but success in promoting these die itselfdoes not ensure a strong pace of long-run economic growth or substantial improvements in future living standards. important factor determining continued advances in living expanders as productivity growth, defined as the rate of increase and how much a worker can produce in an hour of work. ove

the fomc noted it would be inappropriate to raise the fed funds rate and is reasonably confident that inflation will move back to the 2% objective over the medium term. but dependent on thatf assessment of expected progress but if the economy falls as we would expect, it would make inappropriate as some point to raise the fed fund rate but mostted participants rejected the days of the projections based on anticipated path but not statements of intent was to signal how much progress the economy hasitia made with the importance of the initial step to raise the target should not be overemphasized. what matters about broader economy of interest rates including the initial increase of the fed fundslikel rate indeed monetary policy will remain highly accommodative for quite some time in order to support progress of maximum of employment in the projections for the meeting most and disappoint those conditions in a way to more gradual increase of the fed funds rate as a head wind as activity continues toat diminish and deflationary rise is. but it could follow a higher trajectory. conversely i

as a result, the fomc expects u.s. g.d.p. growth to strengthen over the remainder of this year and the unemployment rate to decline gradually. as always, however there are some uncertainties in the economic outlook. foreign developments in particular pose some risks to u.s. growth. most notably, although the recovery in the euro area appears to have gained to firmer footing the situation increase remains difficult. and china continues to grapple with the challenges posed by high debt, weak property markets and volatile financial conditions. but economic growth abroad could also pick up more quickly than observers generally anticipate, providing additional support for u.s. economic activity. the u.s. economy also might snap back more quickly if the transitory influences holding down first half growth stayed and the boost to consumer spending from low oil prices shows through more definitively. as i noted earlier inflation continues to run below the committee's 2% objective with the personal consumption expenditures or pce pric

as a result, the fomc expects u.s. strengthen over the remainder of this year and the unemployment rate to decline gradually. as always there are some uncertainties in the economic outlook. foreign developments in particular pose some risks to u.s. growth. most notingly although the recovery in the euro area appears to have gained a firmer footing, the situation in greece remains difficult. and china continues to grapple with the challenges posed by high debt weak property markets and volatile financial conditions conditions. but economic growth abroad could pick up more quickly than generally anticipated providing additional support for u.s. economic activity. the u.s. economy also might snap back more likely as the transitory influences holding down first half growth fade and the boost to consumer spending from oil prices shows through more definitively. inflation runs below the 2% objective with a personal consumption or pce price index up only a quarter of a percent over the 12 months ending in may. and the food in

thus while labor market conditions improved they are in the fomc judge's not consistent with maximum employment. even if the labor market was improving, domestic spending and production softened during the first half of the year. real gdp is estimated to have been little changed in the 1st quarter after having risen at an average annual rate of 3.5% over the second half of last year. and industrial production has declined on balance since the turn of the year. well these developments you are watching some of the sluggishness seems to be the result of transtory factors including unusually severe winter weather, labor disruption at west coast ports and statistical noise. moderate pace of gdp growth is suggested in the 2nd quarter as the influences dissipated. consumer spending picked up notablely and sales of motor vehicles in may and june were strong suggesting that many households have both the where with all and confidence to purchase big ticket items. in addition home building has picked up somewhat lately although the demand for housing is still being restrained by limited availab

mike: can you see any scenario where greece would push the fomc to put off a rate action? things i have learned in my time at the fed was never say never. imagine is anould area where something would happen that would cause them to change their mind. it would have to be something pretty dramatic. that could happen. the probability of that happening is much less now than it was the last time we went through this in 2012. mike: the imf has been firm in telling the fed to not raise rates until 2016. how has their advice been received at the fed? >> over the years, the imf has always wanted to be the world central bank. it's always telling central banks what to do. naturally pay a lot of attention to them. they have analysis and the things they point out are not to the fed or how monetary policymakers think about it. it's just out there like a lot of other people giving the fed advice. the u.s. do you assess economy in the context of monetary policy? >> is on a steady state path. it is improving and getting stronger. not as quickly as we all had wished, but it is still strengt

remember, the fomc begins a two-day meeting tomorrow.he concern is the fed won't be able to consider -- to signal on wednesday that they are confident of a rate hike even though business is so far recovering from we miss in the first half. and taking a look at the dollar we instead, the u.s. currency falling. a lot of analysts say the dollar could be weakening because of lower-cost oddity -- lower commodity prices. mark: let's take a look at some of the top stories we are following at this hour, investors worldwide are wondering how are the damage could right after chinese stocks suffered their worst day in eight years. it -- the shanghai composite index though more than 6%. there is concern that a rally propped up by government intervention cannot laugh. earlier this morning -- cannot last. earlier this morning, richard ross described the magnitude of the problem. >> the question is, where does this party get it legitimacy? they cannot quite figure it out if the markets cannot work. they have a real problem on their hands and don't know

reading a note from the 24th of fromsays no july fireworks the fomc.e going to get any guidance ? >> no, not likely. the fed wants to keep a low profile on this one. people are wondering whether they might drop some hints and send a signal that a rate hike is coming in september. i doubt that very much. minutes fromthe april, the committee already decided they would not send signals from one meeting to the next. they will wait on a meeting by meeting basis to look at the data and decide what's going on. they will play this one on the negative side. mark: economists seem to agree with you. they see no chance of an interest rate rise this week. if that is the case, what will investors be looking for? >> they will have to look at data just like the fed will. goodabor market is looking . the unemployment rate is falling and job gains are pretty decent. the fence challenge is on inflation. inflation is low, falling below their target. they have to be certain that inflation will stabilize and start to rise before they can raise interest rates. looking athoul

regarding monetary policy, the fomc conducts policy to promote maximum employment and price stability as required by our statutory mandate from the congress. given the economic situation that i just described, the committee is judged at a high degree of monetary policy accommodation remains appropriate. consistent with that assessment, we have continued to maintain the target range for the federal funds rate at 0 to one quarter percent and have kept the federal reserves holdings of longer term facilities at their current level to help maintain accommodative financial conditions. in its most recent statement the fomc again noted that it judged it would be appropriate to raise the target range for the federal funds rate when it has seen further improvement in the labor market and is reasonably confident that inflation will move back to its 2% objective over the medium term. the committee will determine the timing of the initial increase in the federal funds rate on a meeting by meeting basis. depending on its assessment of realized and expected progress toward its objectives of maximum

guest: the fomc minutes and janet yellen. guest: we need to see topline growth to feel better about this recovery. joe: i can't think about anything until the referendum on sunday. alix: i'm thinking about china. cpi coming out midweek. thank you very much. speakcoming up, we will to a member of the european parliament ahead of the referendum in greece. she might have some strong words. ♪ alix: i'm alix steel. joe: i'm joe weisenthal. is makingher democrat the bid for the white house. jim webb announcing his campaign today. he formed an exploratory committee in november. he's a former marine and decorated vietnam veteran and had a brief stint as secretary of the navy in 1987. joe: nascar once you to leave your confederate flag at home. they are asking fans from -- to refrain from displaying the stars and bars. the facility say they want welcoming environment in all of sports. just keeps coming, the confederate flag backlash. joe: grace remains in focus ahead of the sunday referendum where the broader implications of the outco

mike: you will want to hear from the participants in the fomc meetings what the increase they have got based on the data we do not know yet because you look at the calendar, and ordinarily you look at janet yellen, stan fischer or dudley -- no speeches, so there is no guidance to accept the data. michelle will have the smartest interpretations at of all, but we want to know what they are thinking and how they interpret the number. vonnie: j.p. morgan chase called this the battle of the "some" yesterday. a 10% drop in unemployment rate does that bring us above 300,000? what is it? mike: it probably just means status quo, the jobless rate to go down a tick or so or stay where it is. this is probably more a sock to the hawks who would have liked to a gone earlier, but we see ok, we are very close with the message we are sending, and stand by for another month. tom: i want to go 35,000 feet widescreen here at "bloomberg surveillance" and in doing that, we go to michelle meyer. this gdp thing today is a big deal right? michelle: i think it is. the problem with the data that we are analyzing

i think that's the way most see it and that's perhaps the way most fomc members see it.here's risks in either direction. what we think is a few years out from now, it won't matter and even a year out from now, it won't matter when the fed moves. it's much more about the pace of moves. this is different from past rate hikes. it will be thoughtful and we're likely to see not a ladder like the past but a hill and plateau. >> their thoughtful to completing action is where we are. i mean what do they do with inflation if -- i mean the commodity index is down off the top my head about a third so far. so the headline inflation is going to go lower. possibly at the headline level. core inflation stripping out energy and food will be strong. what does the fed do with that? >> what we've seen in past statements in their minutes is they are apologists for inflation. they say in the short term it's low but expectations are that it's going to return to our target rate. and so as long as they hang their hats on that it seems that they're freeing themselves up to act. >> but if you stu

. >> you didn't follow them. >> they called for a review of the incident by the council and the fomc secretary. we have described to you how that review took place. it took place before the review is complete. the inspector general -- >> reclaiming my time. did the general counsel per year guidelines talk to the fmo seaboard or did you make a recommendation to the ig? the requirement is that it initially be reviewed and solely determine whether they make a referral to the ig. they didn't do that. >> before his review was complete he was informed by the ig but the ig had undertaken his own investigation and therefore the ig was already looking at it before it was necessary for him to make a decision. >> my time is almost up. if anyone is trying to sweep this under the rug it's the fed. congress is trying to bring light to this. i sent you a letter with response to your denial from chairman hensarling and we have a full page of footnotes where congress has done oversight during open pending doj prosecution. we have the right to use documents. you have a duty to provide them to us. you

to be followed at the end of the month by the next fomc meeting. for "nightly business report," hampton pearson in washington. >>> still ahead, did the first big company report earnings this season knock it out of the park or strike out? alcoa's results next. >>> mixed >>> mixed results after the bell marked the unofficial start of the earnings season. earnings came in at 19 cents a share. that was 3 cents below analysts' estimates. while the revenue topped estimates and was higher than last year. the company's chief says business is strong despite commodity volatility. >> the markets have faced a lot but here we see, the business performed the best first half since 2007. and there was real resilience. >> shares were slightly higher at alcoa in initial after hours trading. >>> time microsoft will cut thousands of jobs and that's where we begin only the's focus. the tech jinl announcing it will slash nearly 8,000 positions with most of them coming from the phone business. the firm will take charge. shares were off slightly to $44.24. sales of the ap

>> they call for a review of the incident by the general council and the fomc secretary. we have described to you how that review took place. it took place before the review was complete. >> did the general -- i want to reclaim my time. did the general council per your guidelines, talk to the board or make a recommendation to the aig? the requirement is they do an initial review and solely determine whether they make a referral to the ig? >> before his review was complete he was informed by the ig that the ig had undertaken his own investigation and the ig was already looking at it before it was necessary for him to make a decision to refer it to the ig. >> my time is almost up. i reclaim my time. if anybody is trying to sweep this under the rug, it's the fed. it's congress that is trying to bring light to this. >>> we have the right to the documents and you have the duty to provide them to us, and you have no legal authority to deny that request and you are required to give us the documents and i hope you reconsider your denial. i yield back. >> the time of the gentleman

it is probably going to be more important the wording of the fomc.he rate outlook to 2016. having said all that, ig o - -i go -- i go back to my previous point you mentioned momentum. i'm not sure this is what we are seeing this time around. when yellen says something that is considered to be on the hawkish side of the spectrum, we see a pop in the dollar higher but it does not last that long. that is largely because we've seen one of the most brutal dollar rallies between july and march. july 2014 and march 2015. manus: is the market long that rally or not? vasileios: i think the market is long but it is less long than it was three months ago. manus: the other quadrant, jon was just referring to gold. morgan stanley says 800 today. oil is newly in a bear market. the commodity complex is righted. that is having an impact in terms of canada, new zealand and nordic currencies. have those moves priced in this movement in the commodity rout? vasileios: i think they has. the commodity bloc, especially the kiwi as well as the aussie are down substantial pe

andrew: i think they are probably hoping that the fomc moves.ank of england has been nervous about taking the first step. it would give them more cover is the u.s. rates went up first. i think the case has been there for some time verizon u.k. rates. the worry is that they keep on putting it off, they will have to move more quickly than people expect when they do push up interest rates. anna: let's bring in tim coulter, who joins us from our website. good morning. let's talk about china she all we? the plunge in that stock market -- how bad will china get? pretty bad? tim: well, if you believe tom to demarc. he became well known because he picks the bottom in the shanghai composite. we spoke with him yesterday and asked him -- what is your view on the china stock market? his response was that he expects another 14% decline, but worryingly, he compared it to the 1929 u.s. stock market crash. anna: let's hope he's wrong. does china hold that kind of significance? is still quite insulated, isn't it? in terms of international investors ability to ge

it also comes two weeks before the next fomc meeting. it's unlikely yellen will drop policy hints unless she wants to steer marcus to a september rate hike. we just heard from her on friday. but since then disappointing data and retail sales. does that change the timetable? >> they say that yellen be won't be deterred because it's still up 3.3% on an annualized basis. >> i think he's going to nail it down closer to september. i think she will lean toward making sure that the market is ready. >> it's all about data dependence. how do you know? how much can change. >> especially after the lackluster june jobs report. a lot of people are questions whether it will happen in september. >> we will see. coming up today, some of the world's best investing minds are gathering at the 5th annual delivering alpha conference in new york city. that's all we have time for. thank you for watching. >> we'll see you tomorrow. squawk box is next. kids are expensive. so i'm always looking to get more for my money. that's why i switched from u-verse to xfini

as a result, the fomc expects u.s. g.d.p. growth to strengthen over the remainder of this year and the unemployment rate to decline gradually. as always, however there are some uncertainties in the economic outlook. foreign developments in particular pose some risks to u.s. growth. most notably, although the recovery in the euro area appears to have gained firmer footing, the situation in greece remains difficult. and china continues to grapple with the challenges posed by high debt, weak property markets, and volatile financial conditions. but economic growth abroad could also pick up more quickly than observers generally anticipate. providing additional support for u.s. economic activity. the u.s. economy also might snap back more quickly as the transtorrey influences holding down first half growth stayed and the boost to consumer spending for low oil prices shows through more definitively. as i noted earlier, inflation continues to run below the committee's 2% objective. with the personal consumption expenditures or p.c.e.

the fomc released its june meeting minutes. policymakers are looking toward an interest rate increase. however they did express concerns about weak consumer spending and china and greece. global markets have been shaken by the rising risk of the greek exit from the euro and a route in chinese stocks. scarlet: earlier today, the imf reiterated its views that it should hold off on raising interest rate until next year. that came as part of the annual assessment of the economy. the imf held to its forecast that the economy will grow three -- 2% this year and 3% next year. alix: corporate executives and directors were banned from selling stakes in companies for six months. this came after the shanghai composite fell again today, down more than 30% since june 12. that is a more than $3 trillion market drop for investors. much of the money is borrowed. .1% growth, they seem happy with it. easy anti-corruption reforms moving ahead as planned. pretty much everything the government is doing has been not necessarily according to grand pl

>> i think they allow people for up -- around fomc events. get more lumpy and more reactive to these the weeklydentally, vix options have not started trading at. hopefully that will start next month. julie: is there a big demand for the weekly options for the futures that drove them to choose this stuff? >> people who are buying calls and puts to take advantage. they really have to be sure of --etizing it. with these what these weekly options will do this effectively force investors to take the position out right away. julie: got you. let's talk about your trade for today. it is expedia. it has a lot going on. it is kermit -- coming up with earnings after the trade and try to get approval for its deal with orbitz. according to "the new york post" it is looking positive for that. >> i am positive but i'm hesitant as well. want to play somewhat safe. but the implied move in the stock going into earnings is around 10%, slightly on the higher side. i like to sell that but i'm a little bit fearful. what i want to do is said -- do instead is by the

since june, since the fomc anding, there was only 20% one factor as to why they have been getting a liftalix: you kind of get a read on the u.s. economy with that. scarlet: let's take a look at currencies, a big driver for the commodities market, up i 2/10 of 1%. i wanted toalix: focus on the brazilian reality. .- brazilian rial one of the highlights is, what does the central bank do when you are in the middle of the week growth scenario but you ?till have high inflation that is what brazil is grappling with right now. scarlet: enviable situation. alix: the news in russia is that the central bank is not owing to fx to replenish reserves. they will hold off on that and it raises the value of the ruvell to give the central bank a little bit of flexibility to perhaps cut rates at the next meeting because it also needs to grow because oil prices are low. scarlet: aren't those rates at ridiculous levels right now? double digits. anyway, nerd talk. it's fine. [laughter] the top stories crossing the bloomberg terminal at this hour. the labor and housing markets have improved, moving closer to e

investors still very conscious ahead of the fomc meeting.shares lost one tenths of 1% despite a positively due to two very lackluster report cards and a very weak retail sales data with investors confident, but index still outperform the blogger market. sandra: tracey chang, thank you. let's get you caught up in global markets this morning. take a look at europe with a lot of great areas there. game played by the ftse amount in half half of a percent. we've also got green areas. the demand earlier gains. dow futures up 49 points. a higher open is expected in the minnesota dentists. he deeply regrets killing a protected line and while he was on his hunting trip in zimbabwe. authorities identified 50 federal walter palmer as the american involved that killed cecil a well-known lion. last night jimmy kimmel got emotional as he weighed in on this story. >> if you want to do something, make this into a positive, sorry -- sandra: palmer is sought on pushing charges. let's get a look here wednesday forecast, maria molina. reporter: good morning, sa

look as --scarlet: as we ahead to the fomc minutes tomorrow, and you agree with chair yellen that valuations are quite high? mark: by historic measures, they are pretty high, not outlandishly high. they are part of the market where people are more optimistic than they should be. some of the fast growth markets, the ipos we have seen in recent days are fully valued, but i do not see this overall, overhanging fear of a 2000-like bubble like we saw 15 years ago. it does not seem like that. from when i talked to investors, the places they are finding value -- yeah, you can talk about biotech valuations and say what are we doing with these valuations but then you see another transaction for $3 billion today. that tells you the fundamental underpinnings of the market have not eroded and that will probably be seen the rest of the year. scarlet: mark lehmann, thank you. jmp securities, joining us from san antonio. matt: here is a question -- what if greece leaves the euro? it is a question we ask every day. then, it sees its economy flourish. it might be europe's worst nightmare. scarlet: maybe that

jobs report away from them pushing off even a december rate hike because you notice janet yellen and fomc basically said they're looking for more stability in the jobs sector. while they have seen some they want to see further improvement, trish. trish: to the point to the democratic strategist who was on trying to say that the job picture is good. listen to what the fed said. if the fed really believed we were on stable footing when it comes to jobs in this economy they would be in a position to be upping rates. they haven't done it. here we go. more of the same. >> you're absolutely right, trish and they would be hiking, they would be hiking it up. they would have done it already. forget about greece or china, other wildcards. trish: that's the concern. maybe we're looking at a new asset bubble these days. i will talk to bill gross, everyone, about that tomorrow. he will be giving us exclusively his outlook for the month ever august. that is happening right here on "the intelligence report," 2:00 p.m. eastern. we'll see you here. >>> many parents, everyone, they have problems paying for

and mike rican, as we approach talking hour, we are about the fomc minutes, talking about technology,ut all things that can impact the markets. we should point out things work home on wall street today. classic could have been a lot worse with a lot more ripple effects. an interesting thing a lot of people have been worried about is the actual integrity of what the indexes were showing. ally on our team spoke with spokesman for the s&p dow jones about the issue he said around 11:50 this morning, we switched to a composite tape and what they would usually do is take a direct feed from nyse. every siege has its own data sheet. some customers described all of them and some just take a composite. it depends on how much data you want to take. computing the level, tape, ad composite blend of all the exchanges and venues around the world. that is what they are using to compute the indexes. was not much there of an impact on the s&p 500 before they switched. in the dow, the movement was minimal. what is minimal is quantifiable or do we do not know yet. we do not know what the index was showin

an fomc meeting, does it ever reach the level of conversation, does interest rates go back to a level of normalization and what it means to our debt and deficit. ? janet yellen: it is something our staff looks that and i have looked at. congress should expect, and this is embodied in the cbo projections, that as the economy recovers, short-term interest rates will rise. long-term interest rates already reflect that. , ifhe years go by short-term interest rates do indeed rise with a recovering economy, long rates will move up further. this will affect the interest burden of the debt and other things will add to deficit. that is clear. but it is also true that a strengthening economy needs stronger tax receipts. you and i seet: that as obvious. i see many of the discussions around here where we are looking at an environment where reports are telling us that just in a few years that interest will equal our entire defense budget. that section of the new normal interest rate models we are heading towards. my great fear is current monetary policy ultimately emboldens us to engage in bad fis

the statement following this week's fomc meeting didn't provide a timetable but the central bank is signaling it wants to see further economic gains and a rise in inflation before it pulls the trigger. the fed knows the job market housing and consumer spend having all improved and the statement made only slight changes from the previous one in june suggesting a healthier u.s. economy. the word we're now looking for is some. previously it was considerable time, patient, now it's some. >> what the definition of some is basically. >> is it a little bit, more than a little bit? >> i mentioned earlier citi saying if we get a two 10,000 two 20,000 readings on the payroll, that's the green light for a rate hike. the reference to the energy price stabilization. oil is down 10% since the june meeting. very interesting here. you read into this how you will. that's dovish. >> is it? the markets didn't really react too much. >> i think it's how you read into it. >> as always something for the doves and the hawks. we like those. >> yes. okay. still to come on the show we're live from near the channel tunn

the statement following this week's fomc meeting did not provide a timetable. the central bank is signaling it wants to seek further economic gains and a rise in inflation before it pulls the trigger. it notes that consumer spending has improved and the statement made slight changes from the previous one in june suggesting a healthier u.s. economy. >> what could be more important, some say, is the second quarter gdp reading, due out later today. analysts by cnbc expect a rise of 2% in the second quarter. watch for revisions, though to the first quarter number. some analysts expecting an upward shift. the production data a bit of a concern there, too. there's a number of elements here. what we're watching in terms of components is the spending of course. that's expected to be a key driver of growth. consumers finally taking advantage of the lower gasoline prices and businesses, too, with the hiring jobless claims it upping their lowest level since 1973 last week. lots of elements to be watching here today. >> let's continue that discussion, julia with peter oppe

some judgment and analysis is required to reach a conclusion here and i'd say that even within the fomc participants differ in their judgments on where we stand. my own personal judgment which i offered up looking at this full range of metrics of the labor market is that there's a little bit more slack in the labor market. there's somewhat more slack than you would think based on the unemployment rate alone which in june was 5.3%. now we also have to form judgments about what is a longer run normal rate of unemployment. and that depends. that's a judgment that can change over time. within our committee, most participants would judge that 5-0 to 5-2 is the range where they think that normal longer-run unemployment rate lies. so 5.3 is pretty close, but at least my own judgment is that there is a little bit more slack than that. i'd say the fact that wage increases have been as modest as they have and perhaps we're beginning to see early hints of acceleration but not in every metric. to me it's not definitive but it is consistent with the notion that there still is some slack in the labor

the fomc gathering in washington today. an announcement set for tomorrow afternoon.t a minute. overnight in asia china unveiling more recuse measures. the local government will increase purchases of stocks and hinted at further monetary easing. stocks closer lower but well off the session. they had been down by five percent. >> local government announcing they'll be purchasing more stocks. i love that. say that with a straight face. i guess we bought a few bonds but local governments never went in and bought stocks. >> in corporate news procter & gamble is reportedly ready to name david taylor as the new ceo to run the consumer goods giant. a.g. laughly is expected to remain as chairman. >> dupont matched estimates but revenue fell short and the company is cutting its full year forecast citing the spinoff of the chemicals unit and weak demand for agricultural products. pfizer beat on the top and bottom. raising its full year outlook up about 1.6%. merck, earnings were above expectations by a nickel but revenues were a little shy. it's up 11 cents. don't miss ceo ken

in washington, the fomc anticipating to set monetary policy.ll raise rates in september. more consumer spending may have helped the economy rebound in the second quarter. on friday, exxon mobil, sharp, and mitsubishi will report earnings. japan's cabinet will hold a conference on the country's economy. japan's debtd that could triple by 2030 if the government does not change its economic approach. more on theill have tpp after this break. then, why cleaning up pollution in china is having a costly affect the nations energy sector. ♪ yvonne: trade ministers get together in hawaii this week to push for an agreement on the tpp, the transpacific harner ship. the deal aims to create a packed accounting for 40% of world trade. it is attracting plenty of criticism. reporter: the setting looks idyllic, the negotiations probably will not be. the united states hopes a breakthrough will come this week in hawaii. the 12 countries involved are keenly focused on reaching an agreement on the transpacific partnership. the tpp is a crucial part of the pivothit

by the way, we have fomc statements.h i would to anyone parsing fed statements for truth is to find a new hobby because statements have been off by 40% every one of the last six years. they just cut their 2015 gdp forecast in march by 24% during the june meeting. in the interest of keeping it interesting, or in the spirit of keeping it interesting, i will go for a different opinion on the rate situation. i do not think we should discount a september move. the jobs number continues to come in strong pet on a planet at 5.3% has now gone through -- strong. unemployment at 5% has gone through. the fed estimates between 5.1 and 5.5%. 5.3% is closing in on that. i would not discount the possibility of september and if the risk of continues in addition to that, that creates a ton of volatility. stephanie: madame, where 45 seconds. number three. tracy: for the purpose of levity, it has been a serious day, i want to talk about bitcoin. stephanie: bringing a clown car? tracy: i'm trying to make people feel better. bitcoin is valin

as you remember, we kick it on then tuesday, the fomc holds a two-day meeting in washington to set monetaryomists are expecting a hike in september. the debate is between september and december. will they or won't they? francine: on wednesday, microsoft releases the latest version of its flagship operating system windows 10. we're also keep our eye on earnings from twitter and facebook. manus: that wraps up the week. it was all looking very relaxed yesterday. how was he? francine: well, the share price is up 7.7% on the day. i guess you can be pretty relaxed. that's it for "the pulse." keep it right here. our twitter question of the day is whether the f.t. and nikkei, whether it's a good fit. we can also talk commodities. we have pleasant toy talk about, interest rates, commodities, amazon. i love these amazon figures. when you actually compare them with wal-mart amazon has a bigger market cap. but in terms of revenue wal-mart still dwarfs amazon because it has five times the revenue of amazon. manus: exactly. the concern is stopping spending money and actually concerned about the other sha

williams a voter on the fomc this year is seen as a centerist whose views are in line with janet yellen. >> janet yellen goes back to capitol hill today for the second part of her testimony on monetary policy. she testifies at 2:30 p.m. eastern. she told house panel the fed is likely to raise rates later this year and turmoil overseas probably won't effect the u.s. economy. >> a decision on our part to raise rates will say no the economy doesn't stink. we're close to where we want to be and we now think the economy needs higher rates. there have been head winds and we've tried to overcome them. >> yellen might want to raise rates this year but she can't. that's the verdict of the bond king that told cnbc at the delivering alpha conference that the central bank overestimated u.s. economy growth. >> i think it's difficult for the fed to raise rates without nominal gdp increasing and they have a problem with the pce deflator which is not trending higher like some of the other inflation measures most notably the employment cost index which looks like a rising trend and with it being the fav

my view is that probably we'll still take until the december fomc meeting before we see the first rate hike. >> you moved from september to december. i was going to ask if you have to move back up to september after what sounded like she said, one interest rate increase, not a big deal. she is inching to move sooner and be gradual. >> sooner than what? moving sooner was a response to a question that basically implied why not wait longer into 2016? i think there is an argument for moving a little sooner than perhaps the earlier 2016 recommendations from some people. my own view is early '16 seems like a reasonable time she made an argument that was coherent. >> what could go wrong with they raise rates in september? she sounds like she wants to get that first one out of the way to stop focusing on that first rate increase. >> it's the dollar. >> you could get a significant tightening and financial conditions. >> even with a 0.25% rate increase? >> you don't know. my best guess is it probably doesn't have that big an effect. it's difficult to predict these things when it's the first incr

for fomc. an increasing number of people expect to see the first rate hike in september of this year. not at this meeting. former president of the federal reserve bank of dallas joins us now. mr. fisher always a pleasure to have you with us. take us into the committee room if you wouldn't mind and give me your thoughts on how much the open market committee will take into account what's been going on in china lately not so much the stock market demise but rather the economic slowdown there. how big a factor is it? should it be a bigger one than it is? >> during the briefings you get an international perspective and a domestic perspective. everybody comes to the table well prepared with that background. china is being watched. u.s. monetary policy will not be dependent upon what happens to chinese equity markets. they've been floated in an unusual way. central committee put. it's being watched very carefully. main thing is how it might impact our economic growth exports are a portion of our econo

stocks was earned in the 24 hours before the fomc announcements.his is always passed around every time it happens. that's a 2011 fed survey study that was done. right now dow is up 33 points. >> thanks so much bob. let's check in with rick santelli in chicago on this fed day. >> reporter: hi, carl. i'll pick up what you just eluded to. that is the second day of the two-day fed meeting and there is a drift, just a drift, of rates to the up side. look at a two-day chart. i like two-day charts. we are trading a bit and have traded a bit higher than yesterday's yield or at lower price. that's something to pay attention to. if you look at the chart from may first, it tells you how much what we call wood under the market. that's technical support. the more time you spend at a price, the more technically significant it becomes and when you move away from the areas you gain momentum. look at a two-day chart of the bunds. a much different chart. not building the same type of momentum but hovering above a significant level of yield resistant. around three-qu

when they have their fomc meeting next week but more importantly in september, we'll see where the economywhere the financial markets are at that point and they'll make their decision at that point. >> lower labor force participation rate. thank you to you both. it's good to have you on the equity market. >> when we come back buried under all of this is this huge merger in the health care world. aetna agreeing to buy humana. the ceos of both companies will join us live for a first on cnbc interview when "squawk on the street" continues. ths. thanks to the tools and help at experian.com, i know i have an 812 fico score, so i definitely qualify. so what else can you give me? same day delivery. the ottoman? thank you. fico scores are used in 90% of credit decisions. so get your credit swagger on. go to experian.com become a member of experian credit tracker and take charge of your score. >>> shares of aetna are down this morning on the news that it agreed to buy humana for about $230 a share in cash and stock. it will face anti-trust scrutiny in the coming months. joining us now are the compa