james bullard said failing to reach the fed inflation target is hurting its reputation. we will bring you our interview with the president. againstoins the stance risky positions. the question is, is dying down risk the right trade right now? matt: let's take a look right now, 30 minutes away from the european open where futures are trading, we had a reversal in asian markets, they recovered from the trump concerns and turned back down again. here we see futures, no change for european stocks.

louis fed president james bullard addressed this and growth targets in our exclusive interview earlieroday. began by asking him if this is the right time to hike, with levels sitting where they are. james: the idea that there is a lot of growth just around the corner in the u.s. is probably not the right model to have in mind. i know there are attempts, you know, in washington, to push up the growth rate. i applaud that. i think that is a good agenda to have. but so far, not much has been implemented. even if it was, it would take a while to have an effect. probably, at the earliest, the second half of 2018. from a monetary policy perspective, what we are thinking in terms of 18 months or two years, we are probably not going to move far off the 2% growth path ring that timeframe. for that reason, i think it is wise to stand pat on rates, for now anyway. rates,n: stand pat on but full speed ahead on the balance sheet unwind. getting that started coming you said, september. i want to ask you -- for the longest time -- we want to stop buying bonds. we are still stimulative. and you are in

. >> james bullard explains why he wants right to stay on hold. -- rates to stay on hold. >> i think we have a ways to go on inflation. >> and we sort through earnings reports. >> the results are underpinned by strong strategy. >> we would like to move away from talking about just pricing, it is about volume. >> we obviously have the great brands to be able to reach consumers directly. it is a combination of brands, technology, and consumer trends. >> it is all straight ahead on "bloomberg best". rishaad: hello, welcome. i am rishaad salamat, and this is "bloomberg best," your weekly review of the most important business news, analysis, and interviews on bloomberg television around the world. geopolitical tensions dominated the news this week, starting with a pointed exchange of diplomatic signals on monday. >> china says that it is confident that the new u.n. sanctions on north korea will bring the reclusive state back to the negotiating table. the issue was discussed front and center at the foreign ministers meeting in manila at the weekend. how realistic is it to expect that we wi

louis federal reserve bank president james bullard.uld remain on hold given that inflation is lagging well below the feds 2% target. he elaborated on that with our kathleen hays. ♪ kathleen: is one more rate hike this year a problem? james i think we have been : surprised by inflation coming into the downside during the spring here, and not by a tiny amounts. really by a large amount compared to the progress that we made in 2015 and 2016. so if you look at the chart, we were creeping up towards 2%, altering 2015-2016, then in 2017 most of that progress has been undone. i think that is, at least in my mind, leading to a reevaluation of our story about whether our policy is leading inflation back towards target or not, so we will have to see how the data comes in for the second half of the year on that. >> so are you saying let us wait for the data and then when it is stronger, i would be in favor of a rate hike? james of course, we are always : data dependent. i am not too optimistic that we will have higher inflation measured on a year

james bullard address this at a conference today.s bullard: we were telling a story that inflation was gradually going to return to target. you can see the gradual return to target seemed all be going according to plan, until we got this year. and this year, this number has fallen way off, at least on the scale you got here. this number has fallen quite a ways off. scarlet: earlier today, bloomberg " daybreak america's," on if they would take the same bet. >> i think ben cardin blackrock are right, and the central bank of america sees it coming as well. we just can't tell when. we can't ignore the data we saw friday. this is incredibly positive stuff, inflation has to come orioles we've got all this one wrong. the question is is it friday? the great thing for the central bank as they have until december to make a decision because september is out of the equation. david: you said there are robust numbers coming in, many more than were thought. at the same time, which pressure only went about 2.5% annualized, which is fairly modest, gi

james bullard said failing to reach the fed inflation target is hurting its reputation. we will bring you our interview with the president. againstoins the stance risky positions. the question is, is dying down risk the right trade right now? matt: let's take a look right now, 30 minutes away from the european open where futures are trading, we had a reversal in asian markets, they recovered from the trump concerns and turned back down again. here we see futures, no change for european stocks. take a look at what we see happening in the bond trade. i will zoom in to see which direction we are going to coming back up in the yields so investors are selling off german debt. the -- yesterday we took a look bund isthat this, the trading in the tightest range since 1992. almost no movement, no volatility and very tight ranges have been the story of the market and it continues today. equitieserday european selloff, it was quite a chunky soft. 1.5%. that was the story yesterday. this morning the dollar's bid, trade currency is it as well the dollar is bid. let's show you what el

tom: james bullard of st. louis.central blanks -- central banks and inflation. you are provocative about central-bank policy. what will be the new regime for the central bankers if inflation is an anachronism? dominic: there are two things going on. one is the cyclical pressures down on inflation, and some of the disappointment we have seen in the data. behind that, there are structural forces down on inflation. in particular, the failure of the phillips curve. this is what people won't appreciate. if the phillips curve is important because it makes sense of inflation targeting. if you don't have a phillips curve that works, there is not much point for any central-bank targeting inflation because it is the expectation through the phillips curve that makes inflation targeting critical. tom: we saw this in the yesterday, there is this feeling within our system. central-bank orthodoxy is not adapted to a dampening function across an entire economic system, is it? dominic: no. it is true for perhaps any organization. you

james bullard is known for being a little bit of an outlier. you anticipate he might tell you about inflation today? kathleen: well, he is certainly -- it is great for being here and face for hosting a very special show. simulcasting this line. -- live. inflation is the biggest one. inflation has not moved closer to the fed's 2% target. it is pulling further away. jim bullard had been saying, i don't think we need any rate hikes right now. we are in a new regime in economy. growth is stuck at 2%. just a couple days ago, he said, no, the level of rates are appropriate. this is where they should state. that is one of the big topics i want to dig into.inflation has become a global problem. vonnie: i am pulling up a chart, kathleen. 884111 is the chart you can look at. how in fact will they start to pan off some of those securities? kathleen: he has pretty much been pretty clear. they have given us the outline for how they will start this process, reducing the reinvestment of proceeds from the balance sheet, which will be a smaller balance sheet ov

louis fed president james bullard.hat he has to say on the mutual interest rate as well as balance sheet reduction. this is bloomberg. ♪ >> it is the story we all know. record highs in equities, record lows in all of the gauges of volatility. wall street is two points shy of its all-time low. look at the bloomberg. we are very much below the average. you have that orange line where we are now, the blue line the average from 1990 to 2016. we are well below the average and we tend to see the pickup in july through the end of october. will we see that this time? joining us for more is julian emanuel of ubs. julian emanuel: we think we will. we have. if you look at the last several months, we have had a series of one-day wonders, where back in , theyou had the fix up 50% fbi director was let go, it came back. we think when you look at it, the catalysts are threefold. you've got to deal with the budget, you got to deal with the debt ceiling and then there is the fed. as we said earlier, that will develop in terms of discour

we will be speaking with the fed president, james bullard. that is coming up at 6:00 p.m. u.k.ght. york.3:42 a.m. in new just waking up to what is happening on the geopolitical front. this is bloomberg. ♪ guy: 8:44 in london. let us get an update. here is yousef gamal el-din and. withf: let us kick it off a story coming out of north korea. they are examining an operational plan before firing a ballistic missile towards guam, the home of u.s. military base, according to the korean central a spokesman citing for the north korean military. that came after president donald trump ratcheted up his rhetoric against the rogue state to an unprecedented level. korea best: north not make any more threats to the united states. they will be met with fire and fury like the world has never seen. he has been very threatening beyond a normal -- yousef: china's producer prices gains are held steady on surging commodity costs. the producer price index rose 5.5% in july from a year earlier. that is shy of economist estimates as demand assayed resilient and the government strived to reduce capacity

don't forget, kathleen hays with james bullard later this afternoon.rtant time for the fed with james bullard. stay with us through the morning. this is bloomberg. ♪ got you outnumbered. the dinosaurs' extinction... don't listen to them. not appropriate. now i'm mashing these potatoes with my stick of butter... why don't you sit over here. find your awesome with the xfinity stream app. included with xfinity tv. more to stream to every screen. alix: north korea threatens guam and president trump warns of fire and fury. equities drop. fixed jumps. safety ofs into goals. disney cuts ties with netflix and embrace of cord cutter. welcome to bloomberg daybreak. i'm alix steel alongside david westin. today.n ferro is off it is your safety check of the day. s&p futures off by eight points. a nice boost. dollar-yen down .4% and gold getting a slight bit up by six dollars an ounce. david: the war of words between united states and north korea escalated yesterday with trump warning the north koreans of dire consequences if they kept up their threats. >> north kor

our kathleen hays in conversation with james bullard. stay with us.is is "bloomberg surveillance." i'm taylor riggs and let's get to the bloomberg business flash. jeffrey download ceased to much of a good thing. this says junk-bond emerging market that are overvalued. he tells bloomberg that he is reducing those positions. will raisece, he rates. jewelry maker pandora plunged today as earnings missed estimates. management said the retail environment in the u.s. remains a challenge. pandora has become a target for hedge fund shorting stock. mortgage finance giants fannie mae and freddie mac could need bailout money if there's another economic crisis. that is according to stress test results released by regular. fannie and freddie should be allowed to build a bigger capital buffer. they would have to return all their profits over to the treasury . that is your bloomberg business flash. francine: disney is set to report results after the bell today and investors are watching very closely what espn subscription numbers tell us, theme park operations, and

coming up next hour, kathleen hays-- next, our kathleen will interview james bullard. that is coming up at 1:00 p.m. eastern time. we will set the stage, next. this is bloomberg. ♪ this is "bloomberg markets." i'm vonnie quinn. we are halfway to a great busy week for the federal reserve and the u.s. economy, of course. today at 1:00 p.m. eastern time, jim bullard will speak exclusively with bloomberg. tomorrow, we will have the new york fed president bill dudley. we will also get the u.s. july pbi. on friday, the last month's cpi data. probably the most important date of the week. for a little bit of an idea what this will mean, i want to bring in jewel cracjoel. all eyes really on the cpi data for the most part on friday, right? joel: that's right. maybe a little context or background on this. earlier this year, measures of inflation softened. we know there were factors behind that softening. unlimited data plans introduced by a major carrier, some prescription drugs coming off of a patent, and the prices being brought down by generics, but there was a softening in pr

here is james bullard in conversation with my colleague, kathleen hays in st. louis. welcome to a very special edition of the hays advantage on bloomberg radio and bloomberg at the federal bank of st. louis for an exclusive interview with president jim bullard. >> great to have you here. thanks for coming to st. louis. kathleen: it's always fun. thanks to your team and staff. you have been saying lots of interesting things about the economy and monetary policy. just recently you said, do you think it's best now to leave rates where we are. earlier in the year you were more willing to say, maybe another rate hike, but now you say no, lowered unemployment will not you -- will not lead to higher inflation. jim, jobs keep growing. gdp has rebounded. it's above trend again. some people think it will stay there. it's one more rate hike a year this -- this year a problem? >> the fomc has been surprised by inflation coming into the downside into this ring here and not by just tiny amounts, really by a large amount compared to the progress we made through 2015 and 2016. if you

coming up, we will hear from our schools of interview with james bullard. thinks the fed needs to begin reducing its balance sheet. from new york, this is bloomberg. ♪ mark: i'm mark crumpton, time for first word news. britain's ambassador to the united nations rycroft says the u.k. fully supports the trumps stancetration's tough on north korea's nuclear ambitions. threat and many others, we are united in calling on the north korean regime to halt its nuclear program. see it asat we should one of the many strands -- mark: rycroft added that the rhetoric isn't earning chances for diplomacy. holds the keyyang to sanctions being lifted. five members of the military have sued president trump asking to stop his proposal to ban all transgender people from serving in the armed forces "in any capacity." the service members who are suing anonymously are already members of the army, air force, and coast guard. they say the shift in policy announced on twitter violates the u.s. constitution. the change in the status of transgender military members hasn't been implemen

louis fed president james bullard. news yesterday he is a doubt, so we will have -- he so we will have to see what he says about the balance sheet. this is bloomberg. ♪ david: this is bloomberg. i am david westin. disney announced third-quarter earnings and that next year, it will stream espn and disney products through streaming video. shares of disney and netflix moved lower on the news. i spoke with biker after the call and he explained the ship in the media landscape that triggered their new move. bob: we have seen a dramatic shift in the way that media is consumed, becoming more see with mynd i kids and grandkids. a lot of the app-based consumption is done over the top on consumer services. david: that was bob iger. we are joined now by paul sweeney from bloomberg intelligence. on the phone from minneapolis is olsenel flynn -- mike eo and has a price target of $215 on netflix. i want to start with you, paul, about what disney has announced. why did they feel they had to do it now? they recognized with media compan

you won't want to meet the interview with james bullard tomorrow live at 1:00 p.m. new york time. we also have breaking news. british american tobacco has set the size for an eight per u.s. dollar bonds deal valued at $17.25 billion. setting the size for an eight 17.25 billion as dollars. let's get a check of the bloomberg first word news this afternoon with mark crumpton. >> the white house press secretary has tweeted that yesterday president trump had what she calls productive conversations with house speaker paul ryan and other lawmakers on tax reform and health care in her words for hard-working americans. republicans are discussing a compromise when it comes to overhauling the tax system. abouters are talking mixing permanent revisions with temporary rate cuts for individuals and businesses. they are trying to change the tax code without adding to the federal deficit. the draft of a new government report finds that climate change has had a dramatic impact on the united states. according to the new york times the report found that the average temperature has risen rapidly and

james bullard saying -- warning about inflation issues.data hubs prized to the downside and called into question the idea that the u.s. inflation is reliably returning towards target. , you've got a cracking set of moves there. five-year high in shanghai, two year high close in london when it comes to bond board, it is fairly muted open on the bond markets. let's get to sophie kamaruddin with your first word news. starting with china, trade surplus widens for a fifth month in july as export growth remains solid while imports moderated. .2% in u.s. seven dollars terms and imports increased 11%, both falling short of rejections. 40 sixde surplus widened point $7 billion. japan has reported a 36th consecutive current account deficit in june. being economist estimates. i was supported by returns an overseas investment and a trade balance that returned to positive territory. north korea has condemned the latest round of you went sanctions as it reiterated it won't negotiate over its nuclear program until america ceases hostile polities -- polic

but take a listen to what james bullard said earlier.ll be able going on what was have any before. i think it is the right thing to do. i would support getting going on this process. >> gimbal and said that he thinks that september is when the fed should get started. echoed jim in many ways. has been trying to get that number up to 2%. what does that say about the intentions? balancing thisat and by roll off will be very orderly. fed officials are not concerned. it will see how this barclays off. yvonne: thank you for doing this live from new york. samsungwe are seeing shares bounce about 1% right now. jay y. lee could spend 12 years in prison for his alleged role in korea's wide-ranging corruption scandal. this is the harshest criminal sentence ever shot by a major corporate figure. peter, good to see you. it is interesting, they have dubbed the special prosecutor, the windbreaker. peter: this is a change in public sentiment, people don't recall that jay y. lee's father was convicted twice. he served a suspended sentence and was pardone

when it comes to the yen, we had two very dovish sets of commentary from james bullard and neel kashkari to hear from build that the later this week. do you think a less hawkish fed and this debt situation in the u.s. is going to create a lot of tailwind for the yen? >> yeah, i expect the yen depreciates significantly maybe in september, but to us, the end of this year, i expect the yen may hit 100 against the u.s. dollar. betty: do you think we could get there even sooner if we see a market depreciation in the u.s. dollar? >> yes, though of course in september, the u.s. [indiscernible] monetary policy, and also that the debt ceiling may be the concern in the market. dovish may stand to hold and also the debt ceiling [indiscernible] trigger for athe further decline in the u.s. dollar. the japanese yen at the moment is maybe undervalued among the major currencies so there may be a boom for the yen to appreciate. betty: you have the same policy divergence between the boj and what the fed is perceived to be doing. we getght come apart if the fed moving at a slower pace if inflation and wage

to your work in operational research, do we have reaction functions for where bill deadly or james -- bullardith the mathematics we have always worked with? it is a clichÉ, but they are truly in uncharted territory. rick: you could be thinking the phillips curve. there is a 1970's fashion for optimal control. for a. of activity -- for a hold swathe of activity. it can be like trying to control the shower in one of these hotels where the temperature is not very consistent. on the base case, that is quite hard. when you look at the phillips curve, it compounds the problem of central banks. they just need to focus on data may be a bit too short-term to guide them and not think they can have this optimal control. francine: very quickly, doesn't mean that you ignore it for the moment? rick: there has got to be some damping in the system. i think you definitely ignore it when it comes to negative rates. francine: rick, thank you so much. he stays with us. coming up, we will speak with the former u.k. chancellor of the exchequer. we will talk about brexit negotiations. the eu was saying they receive

wednesday, kathleen hays interviews james bullard. this is bloomberg.china is in the news today for two reasons. it released numbers on changes in its foreign reserves showing a slight increase. a turnaround from where it was earlier in the year when it was drawing down on reserves. china joined with the united states and united nations to impose tough new sanctions on north korea. joining us now is one of the foremost authorities on u.s. china relations. she served as the deputy assistant to u.s. trade representative's. negotiatorbeing the on various agreements with china. she now serves as senior fellow of the paulson institute. she joins us today from washington. welcome to the program. good to have you. the things i mentioned. on the one hand, trade. there are pending issues. they said they will look at a 301 action which is pretty stern for the u.s. government. there's the pending steel issue and north korea. is there a little bit of a quid pro quo going on? >> there's a lot of frustration with china on market opening for foreign firms and this adm

coming up next week, kathleen bullard atiews james the 12:30 on wednesday.by germany's leading insurance company is starting to pay off. pimco received a record $250 billion in inflows -- euros, rather. future of the bond firm, we zpoke to the cfo at allian earlier. >> i will not make a forecast for help and co-is developing. and wont has to be done every week. rick, never mind passive versus active, if you make money, the money will chase you, that seems to be the take away. rick: at the end of the day, fixed income money this year, our funds, money keeps flowing into active parts of the market and it is flowing into passive. i think there is a realization is that in money markets, you can get beta effectively and it is going to keep growing. where can you create durable outflow? where can you create persistent returns? i would argue that active and passive are continuing to grow. jonathan: does the money going to passive strange --change the structural story? katie: that absolutely has. the velocity at which money is moving into market cap makes me a littl

bullard. he shoots in, scores. >> huh-uh. >> the globe trotters challenged lebron james to make the same shot and haven't heard from him. >>t was continuous. >> either way, though, the shot is out this world. >> you got it. >>> good morning, everyone. one we have check on the roads and we're watching the schuylkill expressway. we're almost at a stand still around city live avenue. everything is getting off into headed up from montgomery slow around city live avenue now. we're about two minutes away from an opening for the burlington bristol. there's a crash in cheltenhem. we'll end here with this new accident on the the p.a. turnpike near lansdale. >>> just before 7:00. a little cooler this morning than just an hour ago. 68 degrees in philadelphia. sunny skies all day long. like yesterday, humidity will be dropping during the day. 72 degrees at 9:00. but lunchtime, up to 82 fwres. and a warm-up into the 80s. really comfortable. bright, sunny skies all day long. looking for cooler temperatures. you'll find them at the shore. a nice sea breeze blowing this afternoon. 79 degrees at the shore. that 86 degrees in philadelphia,

bullard of harlem glo globetrotters took sinking a basket to new heights. he shot from a helicopter 210 feet in the helicopter, 210 fee the air and in globetrotter fashion sinks it. challenged lebron james> that's a pretty unbelievable shot. >> do we know how many tries it took? >> do you guys actually think lebron james could make that shot? >> i think he could. >> that's pretty intense. >> i give louis ten shots and he makes one. >> still ahead, everybody, a massive multi-million dollar chinese investment now looking uncertain. and why lawmakers may not be able to sign off on a proposed foxcon plant. starting their day building on over a hundred years of heritage, craftsmanship and innovation. today we're bringing you america's number one shave at lower prices every day. putting money back in the pockets of millions of americans. as one of those workers, i'm proud to bring you gillette quality for less, because nobody can beat the men and women of gillette. gillette - the best a man can get. "how to win at business." step one: point decisively with the arm of your glasses. abracadabra. the stage is yours. step two: choose la quinta. the only hotel where you can redeem loyalty points f