manus: jodi schneider with the latest on north korea.ed now by the monday asset management head of global equity. week to ader, last certain extent, it masked an opportunity for everyone to take some money off the table. what we have got is -- markets are no longer stretched, if anything, what we learned last global stress index. what did you do last week? >> very little. high, so itre quite is pretty unlikely that the geopolitical escalation that we saw last week is going to bring this momentum to an end. we have seen it already subside this week. i think everyone is wondering what is going to bring this particular cycle to an end. personally, i think it is unlikely. in the short-term, these risks will pop up. we have seen it with this spot with north korea. there isn't some dramatic event, and i think that is , ultimately, the market is going to shrug these kind of events off. anna: in terms of where the markets head with his information, with the geopolitical news flow we have seen, if markets are looking for a reason to sell, if inve

jodi schneider joins us. good morning and good afternoon. where is this rhetoric heading?tainly appears to be heightened rhetoric. over the last few days we have seen donald trump's fire and fury comments, which then provoked north korea into saying that it would strike, it would sent a missile over selfless japan into guam by mid-august. if the u.s. did not back down. of course the u.s. did not. we have heard from south korea and japan yesterday that they would take defensive action if this guam threat came into being. we just recently read in an editorial in china in the communist party affiliated publication, that they will not -- the editorial suggests that china should not intervene if north korea tgoes ahead with this threat. so, it is a heightening of tensions. donald trump's voices seems to be the loudest, in terms of further provocations. we did hear one thing from australia. malcolm turnbull said australia would support the u.s. he did have some calmign words. for the most part, it has been a heightening of tensions. manus: thank you, jodi schneider, joining us w

let's get to jodi schneider.emind us what has been happening with the rhetoric levels over north korea with the past few days. we've had trump, tillerson, and now south korea. >> that's right, in that order. we started with president trump and his comments about fire and fury, which set off an exchange with north korea are they came with fairlyd detailed comments about striking ing with -- striking guam coming weeks. within her back just today in the last few hours from south korea saying that they would respond to north korea. so there have been impetuous comments from president trump, his secretary of state did not even know about this, obviously the war of words is heating up among the powers. shocking thatite rex tillerson didn't even know that this was the way we were going to go. quite unprecedented in regards to previous heat exchanges over north korea reflecting on this as to whether was something very different to kennedy. hadn recent years we've u.s. presidents, clinton and ofrge w. bush, in the axis ev

anchor: bloomberg editor jodi schneider.omments to support defend secretary james mattis's plan to reduce by about 50% possibly. i think the number bandied around by everybody is 4000 troops. reporter: that seems to be taking a page from the defense secretary playbook. victory estate tillerson also wanted this comment to be advising and offering assistance to the afghani forces. that is the plan. it is actually not all that much of a change from the current policy. it is, however, a big change from the campaign trail when candidate trump came out and said we should get out of there. we spent way too much money. even if some of his more recent comments were supported by steve bannon, who has now left the white house. it seems like the forces within the cabinet have prevailed and won in terms of what the president to take this kind of policy. tracy: remind us what the current situation is actually like in afghanistan. reporter: is not a good situation right now. the defense secretary himself said we are not winning the war in

anna: let's bring in bloomberg's jodi schneider. good morning to you. t trump's comments being received, both in washington and in the business community? we are seeing fallouts politically and from the business leaders. jodi: that's right. there is political fallout with capitol hill lawmakers of both parties. they are concerned about these remarks. it puts them in a difficult position. it's not something they want to defend. it's a -- it also distracts from the legislative agenda. congress is in summer recess, but they had hoped to get down to business on things like infrastructure, what the discussion was supposed to be about. there is frustration with that. among business leaders, and we are seeing more defection from the president's business council over these remarks. these are not things business leaders want to be associated with, so they are leaving, and there is frustration there as well. expect?odi, what can we the other set piece is nafta discussions begin today. our last guest release said, that nothing to see here is not going to be a make

anna: jodi schneider, thank you, joining us from hong kong.ichael bell and tim haywood are still with us in london. mike, looking at the constant news flow around nafta, there was a lot of rhetoric during the campaign. some of it has died away. i spoke to an fx analyst and he said that damage has been done in terms of fx, and this will be tinkering with nafta. that's all for the good; perhaps it does need an update after 20 years, but nothing major. is that your expectation? >> we are actually moderately overweight on the mexican peso at the moment. there is some risk in the worst-case outcomes of the nafta negotiations. we are happy to tag a little bit of risk there to the carry on offer. mexico is reasonably attractive. we are willing to take that nafta risk at the moment, which gives some idea of the likely path of this playing out. anna: tim, does that join with your thoughts? >> i think the mexican peso is the best performing currency of the year. anna: after a big fall. >> which is a further reversal of trump trades. it is interesting ho

bloomberg's jodi schneider reporting for us on the relief of the markets behind crawlies that are globaloday. are global ift you are a bloomberg customer, you can watch tv or the show using tv on your terminal. there are three panels on the tv function when you pull it up. you can seen interactive television, watch guy and myself or later on when we moved to radio, you can click the middle panel and any event coverage, for example the president holds a speech, you can click on event coverage and see that. guy: let's talk about what is coming up. deputy prime minister gets caught up in confusion. we take you to sydney for the latest on that story. us is bloomberg. ♪ ♪ taylor: welcome back. matt: i'm matt miller alongside guy johnson. untile about 16 minutes the start of cash trading in europe. let's go to hong kong for the business flash card for that, juliette saly. a stake in french yogurt maker danone, because it views the company is undervalued. in activist fund owns shares danone worth about $400 million. stock rose on the news. representatives declined to comment. the

jody schneider with the late thoennes u.s. administration. john raitt is still with anna and myself. aye written down here, trade wars, balance sheet reduction. there's only one fact, balance sheet. what preoccupies most. trade or balance sheet reduction? >> from a market sense, balance sheet reduction is the key. the fed has been a huge enflunes on what's going on in the treasury market ever since it began 10 years ago. as it starts to reverse that process it will be a beg influence as well. the speed at which it moves is going to have a bigger influence at least in the short-term on u.s. treasury yields and other issues. anna: and the july meeting, in terms of sequences and what we see when from the fed, what's your latest thinking? >> we thought initially they would continue edging rates higher before they started balance sheet reduction but the july meeting made it here they're focusing on that process of tiptoing away from full bore q.e. that's not what we anticipate first in september. we think about rate hike is probable this year. man

joined by bloomberg editor jodi schneider. dy reported on today, including increasing u.s. troops engaged in afghanistan. but also we expecting with this speech? jodi: this is important for the president. it is his first speech to the nation since the january address to congress. he is hoping to reset after this with losingeek support from the business charlottesville and the departure of its steve bannon. he is expected to use this to talk about the goals and afghanistan and trying to reset their, as well because afghanistan wasn't something during the campaign that he came and said we should get out of there. now, he wants to have a more sense didn't -- substantial discussion. yvonne: you were so much from him on twitter, it is rare to hear from him in this format. where are we in the situation in afghanistan right now? jodi: this has been the longest u.s. war, 16 years after 9/11. each president has faced this. george w. bush, president obama, and now president trump. they have faced a situation that is difficult. -- abouten

for more on this were joined by jodi schneider. trying to get congress to do on tax law changes, and why's it so important for him? >> he wants a rewrite of the u.s. tax code. he wants to reduce the corporate rate all the way down to 15% from the current statutory rate of 35% and he wants to get rid of some tax breaks and exclusions that make it a better deal for regular workers, which will be a hard left, particularly in this environment or hasn't been have get much the congress at all. that's really why he wants this so badly. he wants to remove the memory of the problems trying to get rid of obamacare, that spectacular defeat in july just before so -- just before congress let the the summer recess. and also he wants to give the business community something. betty: we talk about this all the time, but the likelihood of tax reform getting through as quickly as he wants, what are the chances? jodi: really difficult. there has not been a rewrite of the u.s. tax code since 1986, not a major one, because it is so hard. every industry

for more, let's bring in jodi schneider. will be the focus of donald trump's speedch, and what is his strategy in delivering it? reporter: he is going to talk about afghanistan and a southeast asia, but more important is the strategy. he is trying to get back conta n track during a 17 day working vacation, at which point many things happened. response to the charlottesville incident, which furyd a lot of his record, his approval ratings are at record lows. he really wants to reset the conversation by talking about the military and foreign affairs and trying to be more statesmanlike. -- thatl really rule will be the goal here. can we expect to hear on afghanistan? >> it will be interesting. the speech is apparently written and they are still looking at which themes they want to hit. we do know that steve, his fire that just left, really was against more, increasing the levels in afghanistan and other advisors met up with cabinet members and put the defense secretary and secretary of state at risk, who want to see a continuing