jonathan: i want to ask you for prediction on the score, because it plays out over the weekend and youight look silly. i want to get to the italian bond market. is 260 a good entry point? alan: we are still underway, but short run, it looks money good in the sense that the fear of rates going higher and a general bond bear market. over time, we have seen it many times before, the market goes from fear to, where can i get an income? and if you need to get an income in the euro zone, italy is where you go right now, more so than portugal, obviously. i would say the better trade is the front end. these are ridiculously low yields, 60 basis points in italy. that must be seen in the context of a -0.4 reference rate. jonathan: colin, often the perspective on europe is different from london to new york. what are your thoughts on europe and the kind of trades he is talking about? colin: i would agree with the trade with respect to italy, and i would take it back to draghi. i happen to be a person that thinks even though he was, what would appear to be ultra dovish, he did an excellent job. als

jonathan: i know a lot of people are itching to short german bunds. ny of them say it is the most overpriced security on the planet. will this change anytime soon? andrea: i don't think so. we just saw decent data come out of germany softer again. until we get that resurgence of growth across the euro area, and you have the overhang of the budget in italy coming up in september, as well as the whole italian drama to play out through year and, i think it is likely that is a short that will have to be on the sidelines. jonathan: one of the things the ecb and fed have done is put a big bid in for the dollar. in a moment we will be talking about that and emerging markets. everyone sticking with me, colin robertson, andrea di censo, and alan higgins. coming up also, the auction block: italy. a first major test of investor appetite as political fears subside feud that is just around the corner. ♪ ♪ jonathan: i'm jonathan ferro, this is bloomberg "real yield." i want to head to the auction block, the u.s. treasury auctioned over $190 billion this week. i want

jonathan: i think that's a good point. the majority of our viewers would agree with that as well. does that resonate with you? mark: i give myself the grade for calls of the year coming into january, this is an area where i give myself b or b-, because we did not think the curve what flatten this way. i am sticking with the call. i'm not sure that we continue to flatten. i'm getting more concerned. as we think about the tray dynamic and what we are seeing from the global growth standpoint, the inability to decouple we mentioned, you have got to be a little bit worried about that. however, long-term, i believe that we are normalizing across the board from a monetary policy standpoint. that means higher. jonathan: i'm going to put you in the boxes and we are going to do the rapidfire round. i will ask you some quick questions. hopefully you will give me decent answers. keep it short. have we seen the high of the u.s. 10-year yield for 2018? priya: yes. bob: no. mark: no. jonathan: leveraged loans or u.s. high-yield into year-

jonathan: i know a lot of people are itching to show off german burdens. calling it the most overpriced security on the planet. -- to change anytime soon? andrea: i don't think so. we just saw decent data come out of germany. until we get that resurgence of growth across the euro area, and we have the overhang of the budget in italy coming up september, as long -- as well as the whole italian drama to play out through year-end, that is a short that will have to be on the sidelines. jonathan: one of the things the ecb and fed have done is put a big bit in for the dollar. everyone sticking with me, colin censo, andandrea di alan higgins. coming up also, the auction block: italy. political fears subside, just around the corner. ♪ ♪ jonathan: i'm jonathan ferro, this is bloomberg real yield. over.s. treasury auctioned $190 billion this week. i want to focus on the 10 year auction, the lowest since april. demand was strong with the highest level since january. the nation sold a combined $6.6 billion worth of notes ranging from three years to 30 years. credit, hi

bob: can i short them both? jonathan: there we go. itter account, is it the new leading payroll indicator for payroll friday next month? yes or no? robert: no. i bet on volatility, so no. mary: hopefully not. bob: no. jonathan: you guys wanted to avoid that. they got their pr standing in the corner. great to catch up with you. robert, mary, bob. that does it for me from new york. that does it for us. we will see you next friday at 1:00 p.m. new york, 6:00 p.m. london. for our viewers worldwide. this was "bloomberg real yield." this is bloomberg tv. ♪ . >> kuwait, uae, and saudi arabia gather to talk. storm central. storm season picks up in the u.s. terror of time. clock runs out to get exemptions on steel and aluminum tariffs. the fallout from trade breakdowns. ♪ alix: i'm alix steel. welcome to "bloomberg commodities edge." 30 minutes focused on the physical aspect behind trading with the smartest voices in the business.

jonathan: from new york city, i am jonathan. 30 minutes dedicated to fixed income. this is "bloomberg real yield". coming up, the jobs report leaving the federal reserve on track to deliver more hikes. bond investments and liquidity might not be there when they are needed. why this firm had its biggest one-day drop in four years. we begin with the jobs report. it is good news on all fronts. >> it is a good gain. >> the wage number was very important and this is good news. >> wages are above .5%. still not strong. inflation is bouncing around so real wage growth is muted. people are dipping into savings to spend. that is worrisome. welcome news but still not 3% sustained. we are not seeing broad-based acceleration that we would like to see. that hawksnario basically think they can move once twice, some say three times, i say june is the last. >> we will go three to four times, probably four. jonathan: joining me is chief investment strategist, senior portfolio manager at hsbc and bob miller, head of fixed income strategy at blackrock. great to have you with me. bob,

jonathan: i know, mark, that you do. where does it still play out, mark? mark: i think it is a function of the actual fundamentals and when you are getting paid for them. we looked at spread vs. turn of leverage. it is surprising we can even with the compression we have seen across the leveraged loans, still 73 basis points. from the fundamental standpoint, you are cheap, although it certainly tightened a lot. we have gotten the rate dynamic that has been helpful, and will continue to be helpful. you look at the expectations for the hike in september and december. our call for four hikes this year is in play. continues, i see the relative dynamics to be fairly good. technicals are going to be good in this space. we don't have enough issuance. there is a lot of demand for the floating continues, i see the relative rate. high-yield.oans vs. jonathan: there is a lot of demands for the flowing right. why we have seen some of the underwriting standards deteriorate, because there is so much demand. again and again i am told that this is higher up on the tax struc

>> i like both a bit. >> spain as well. >> can i short them both? jonathane trump twitter account, the new leading perils indicator? yes or no? >> i would bet on volatility. no. >> hopefully not. >> no. jonathan: you all wanted to avoid that. we have pr in the corner. powers, bob mary miller, thank you. see you next time. for our viewers worldwide, this was "bloomberg real yield." this is bloomberg. ♪ >> nine mark crumpton with first word news. france's finance ministers as the u.s. is becoming increasingly isolated as president trump continues to push his america first trade policy. he spoke to bloomberg tv at the g7 gathering in whistler, british columbia. we should have been united during the g7 to tackle the global challenges of the world appeared on thinking of course about growth, employment, development, and instead of that, we will be divided between not being a g7 but ag six plus one. u.s. impose new tariffs on steel and aluminum imports from some of its closest allies. the eu says it will take immediate steps to retaliate. can do impose tariffs on

we are pushing 3%, and i think that is a big number these days. jonathanw do we know where we are in the cycle? i hear people talking about late cycle. what does that mean to blackrock? bob: late cycle is a really challenging debate. economically, with unemployment rates below the natural level, that would suggest we are later in the cycle. as we also know based upon history, that does not change until something disrupts it and it is subject to change a lot. financial markets strike us as reasonable valuations in fixed income, likely to get a little cheaper. risk assets are reasonably valued, but the growth trajectory is the harder question. piling on fiscal policy at full employment is not exactly the prescription we would have suggested. we think it creates a larger risk of a boom-bust scenario where things look good for the the next several quarters and then the lack of organic replacement demands could create deceleration. it is a tricky environment, but the fixed income market is reasonably priced for the balance of outcomes. jonathan: i want to wrap

jonathan: there we go. oksana: do i really have to? jonathan: indulge me. na: i will go with e.m. jonathan: there you go. krishna? krishna: i will go with e.m. jonathan: trying to ask americans about football. jim keenan, krishna memani, oksana aronov. i'm not doing that again. that does it for us from new york. we will see you next friday at 1:00 p.m. new york time. 6:00 p.m. in london. this was "bloomberg real yield." this is bloomberg tv. ♪ . two, down, back up! our phones are more than just phones. they're pocket-sized personal trainers. last minute gift finders. [phone voice] destination ahead. and discoverers of new places. it's the internet in your hand. that's why xfinity mobile can be included with xfinity internet which could save you $400 or more a year. it's a new kind of network designed to save you money. click, call, or visit a store today. ♪ alix: this upcoming program was recorded earlier this week. we hope you enjoy the show. opec debates how much output should increase, it is russia versus iran, with the saudi's in the middle. trade battle

jonathan: there we go. oksana: do i really have to? jonathan: indulge me. na: i will go with e.m. jonathan: there you go. krishna? krishna: i will go with e.m. jonathan: trying to ask americans about football. jim keenan, krishna memani, oksana aronov. i'm not doing that again. that does it for us from new york. we will see you next friday at 1:00 p.m. new york time. 6:00 p.m. in london. this was "bloomberg real yield." this is bloomberg tv. ♪ . . alix: this upcoming program was recorded earlier this week. we hope you enjoy the show. opec debates how much output should increase, it is russia versus iran, with the saudi's in the middle. trade battles dragged down caterpillar, one of the best-performing stocks over the last two years. and power ahead. over $8 trillion will be invested in wind and solar in the next 30 years, the latest report outlines the rapid rise of alternative energy. ♪

oksana: i will go with e.m. jonathan: there you go. krishna? krishna: i will go with e.m. trying to ask americans about football. jim keenan, krishna memani, oksana aronov. i'm not doing that again. that does it for us from new york. we will see you next friday at 1:00 p.m. new york time. 6:00 p.m. in london. this was "bloomberg real yield." this is bloomberg tv. ♪ jason: welcome to bloomberg businessweek. i am jason kelly at bloomberg headquarters in new york. a big show for you this week. we start in london where we explore that city's future as a financial hub given the backdrop of brexit. we go to south carolina where we talk to the although ceo about the new plant there. what it means for that state's economy and for volvo's chinese owner. we start with the big story of

jonathan: world cup winner. e.m. or dm? jim: not the united states. oksana: do i really have to? jonathan: indulge me. will go with the e.m.. krishna: e.m. jonathan: trying to ask americans about football. jim keenan, krishna memani, oksana aronov. i'm not doing that again. that does it for us from new york. we will see you next friday at 1:00 p.m. new york time. this was "bloomberg real yield." this is bloomberg tv. ♪ two, down, back up! our phones are more than just phones. they're pocket-sized personal trainers. last minute gift finders. [phone voice] destination ahead. and discoverers of new places. it's the internet in your hand. that's why xfinity mobile can be included with xfinity internet which could save you $400 or more a year. it's a new kind of network designed to save you money. click, call, or visit a store today. ♪ manus: you're watching "best of bloomberg daybreak: middle east." the major stories driving the headlines from the region this week. opec on a knife edge, speculation about output cuts swirled as ministers gathered for the crucial meeting in vienna. welcome to the club. saudi

jonathan: world cup winner. e.m. or dm? jim: not the united states. oksana: do i really have to? jonathan: indulge me. na: i will go with e.m. krishna: e.m. jonathan: trying to ask americans about football. jim keenan, krishna memani, oksana aronov. i'm not doing that again. that does it for us from new york. we will see you next friday at 1:00 p.m. new york time. 6:00 p.m. in london. this was "bloomberg real yield." this is bloomberg tv. ♪ what's a gig of data? well, it's a whole day's worth of love songs. 300 minutes of baby videos. or, it's a million chat messages. a gig goes a long way. that's why xfinity mobile lets you pay for data one gig at a time. and with millions of wifi hotspots included, you'll pay less for data. it's a new kind of network designed to save you money. click, call or visit a store today. alix: this upcoming program was recorded earlier this week. we hope you enjoy the show. opec debates how much output should increase, it is russia versus iran the saudi's in the middle. trade battles dragged down caterpillar, one of the best-performing stocks over the last two years. and pow

jonathan: from new york city for our viewers worldwide, will -- i am a jonathan ferro with 30 minutes dedicated to fixed income. this is "bloomberg real yield." ♪ coming up breakdown on , international diplomacy. will it derail global growth? central bank governor in a world of pain asking the fed to help. ecb refusing planning to discuss -- planning -- refusing to be held hostage and planning to discuss the end of qe. we begin with a big issue, emerging markets asking the fed for help. >> the fed is always clear they are making policy for america. even if you do consider the rest of the world, you are not making policy developed countries running policy badly. >> the fed is guided mostly by u.s. factors and it would take a massive global crisis to change the fed behavior. >> people make the comparison to 2013 and say the e.m. is better place, but we are missing the point there other vulnerabilities, not just external anything but in places like brazil, public debt is a huge issue. >> the emerging markets appears to be contained to argentina and perhaps turkey. this is happening in a

jonathan: from new york city for our viewers worldwide, i am jonathan ferro with 30 minutes dedicated to fixed income. this is "bloomberg real yield." ♪ david: -- jonathan: coming up, it is a breakdown on international diplomacy. enough to derail global growth? the central bank of alabama is in a world of pain, asking the fed for help. and the ecb refusing to be held hostage and planning to discuss the end of qe. we begin with a big issue, emerging markets asking the fed for help. >> the fed is always clear they are making policy for america. but even if you do consider the rest of the world, you are not making policy to bail out countries that are running their economies badly. >> the fed is guided mostly by the u.s. factors and it would take a massive global crisis to change the fed behavior. >> when people make the comparison to 2013 and say the em is in a better place than 2013 and a significant about her place in the 1990's, we are missing the point that there are other of -- other vulnerabilities, not just external financing, but in places like brazil, public debt is a huge issu

looked out of their depth to times it's a really awful defending oh where do they go from here jonathan. i mean it was that reading for performance like saudi arabia the bad the threatening iran screen name call for dad to be yeah i'm pretty average right despite the big three in the right amount of the be prepared maybe you could not prevent it or you've got something very nice going to stay in saudi arabia have no say much right to do now and this is already pressure on paper was the easiest game that may have to play out your gripe and easier too much compromise and they didn't tighten the belt they couldn't even write a more than five year old company that preparation for the tournament but i feel they had to fight to. protect one of my primary means of meeting and try to make them pay for it sacking he just came back today and say hey i got the right to go oh right jonathan corrina mangubat and say in a mosque out think you so very much. and i'd like to bring you up to speed now with some of the other stories making news around the world. the state of new york is issuing to dissolve u

from work last night and you know they're the next match and i was the twenty seventh of june is of course germany faced south korea and as jonathan said there it's all to play for essentially a mark group so the drama isn't over just yet not just talk here on wednesday so i still watch how to fully inmates from that interview sports. polls have opened in turkey's presidential and parliamentary elections incumbent laser rhett's of tayyip erdogan and his a k party are facing stiff competition particularly from opposition kansas. from the secular republican people's party and he's held huge campaign rallies across the country and is hoping to force her to onto a second round runoff the opposition has been bolstered by voters' concerns of it a weakening economy and the ruling a k party is increasingly autocratic rule and correspondent dorian jones is with us now from outside a polling center in istanbul durian can you give us a sense of what's happening where you are right now. well there's been a steady stream of photos since the polling station here opened at around eight o'clock now traditionally voters do in here in turkey vote l

ok jonathan i know you have to catch a flight now so back off you go to the counter near moscow and we'll be talking to you again and later jonathan harding of sports team in tsotsi a slice of last night's making much epub of the result most difficult as a massive relief to the funds here or to reckon but there was there was i mean plenty of people and it wasn't the nicest of nights now saturday night in berlin it was broken down rainbow people went out they watched the match in places like the brandenburg tour and all their bars and restaurants across the city i think we need to take a look at how dramatic it was for them. it was the germany fans worst nightmare as sweden went ahead a nail biting wait five to four lynn's fan mile erupted as marco rose equalized for germany early in the second tough. and finally jubilation the agonizing prospect of a draw all forgotten is toni kroos sealed a miracle victory in extra time. just amazing we pulled it off at the last minute incredible i can't believe it fantastic. this. it's really overwhelming which just so happy we couldn't believe it would

germany seem even if there are some surprises in the starting eleven expectation and of course jonathan i can't let you go without a bet where you're putting your money. over the well germany haven't been fantastic in the build up to this sort of mint but you germany do always do well tony once and they are sort of a team i predict that they will win this one three one the statement all right jonathan harding in moscow for us thank you very much. goalkeeper noire will lead his team mates as they march out onto the pitch the loot sneaky stadium in moscow but this time four years ago but it was for diploma captaining the side now ahead of this awful news game he's been talking to all moscow bureau chief here euro setter in an exclusive interview. how mr love how are you and what are your first impressions of russia of their group i'm doing great because i'm back at the world cup and that's always something special i get to watch lots of games and that's really nice and for us i think what do you like about russia. at the moment i'd say that the people here are really excited about the world

jonathan: i imagine you will. i imagine you are two, kathy.n europe and ecb, they are incredibly reluctant. what do you make of that and how does that set up for next week? kathy: they have a tough line to walk. they have pressure coming from a populist push that has been underappreciated for about two years right now. they have to deal with that and they have to show they are not taking that into account and setting policy. we are not going to get much out of the ecb next week. they will say they discussed the idea of ending qe, and that will be all we get. point,n: kathy, to your this is been on the table for years and months, and yet we are still vulnerable to reversals and risk appetite. why, when we are aware of the risks at the time are we pricing ?n doom and risk question ma because we did: not price it in initially. very compressed because of qe and the idea that there would always be a central bank to step in. the whole market has to reprice. jonathan: it is concerning when you consider the rest of europe and fixed income. typically,

see already jonathan harding he's just outside that stadium and he is with us to tell us more and jonathan i hear a lot of shouting in the background it is the big moment about almost arrived just how big is this game. where you are right there is a lot of shouting i think that's because there's a lot of excitement about this game i don't think it gets any bigger than this for germany it is a huge huge game they're under pressure they have to win the expectation is that they will do that. there's also a man under pressure as the head coach who hasn't got it right in the first game he is the center of attention i don't think it's an underestimation to say that this is perhaps the biggest game in german football history in the last fifteen years all right so the coach joachim loew he's got to get it right this time which player . or is he going to be calling on tonight. oh no not enough is out officially yet but there are some suggestions that he's going to change to three five two it means that mario gomez is expected to come in and start with him of an antonio ruediger is supposed to be the

obsolete and correct me if i'm wrong but i read that this is actually never happened never happened journalism has gone out at this stage in the tournament and i'm jonathan and i believe or at least i hope you're still standing by for us because you traveled back from cars and with with the team last night and so i'd like to ask you what was the mood like. oh very similar to the headlines that thomas wrote out after the game you homeless said to be atmosphere in the changing room was deathly silent i think that disappointment is carried its way through to this morning and the team mr spin desperately disappointed yesterday after the game players that spoke to the media you could just see on their faces tony cross is perhaps the best picture of that he was stood on the pitch after the game for an awful long time just looking absolutely dejected i think germany cannot believe that they've let themselves and let's make no bones about it they are to blame for this that they've let themselves get into this situation and the disappointment is the word you were actually at the match what was it like to watch this unfold. it was like watching germany every game

studio and we also have jonathan harding at the germany team camp that's just outside of moscow jonathan i want to start with you what's been happening the team i understand it's on its way back to germany. that's correct it seems through straight after the game yesterday from because i'm black so moscow on the bus left but it's unclear where the hotel was so was the airport this morning on the side of the bus that said let's write history together and ironically that's exactly what germany have done just not in the best possible way the kind of history that this germany team doesn't want to write their mood is disappointed everybody is the jacketed and the shock is still very present in the germany coach tom it's still very present here as well how devastated have germany fans been you've been tracking some of the reaction i have indeed and the german fans are very devastated part of the reason of course is because this was such an unexpected catastrophe germany had gone into this tournament with such high expectations they were the world champions nine of the players from the winning sco

party over country is going to lead to the republican party not existing one day very soon. >> jonathan, iask you about giuliani's claim that the first lady believes the president's denials of an alleged affair with stormy daniels. that drew quite a response from melania trump's spokesperson, here's the quote. i don't believe mrs. trump has ever discussed her thoughts on anything with mr. giuliani. how do you respond to that. >> that's slap-down of rudy giuliani by the first lady. like when she would push the president's hand away when he was trying to hold her hand. the "washington post" had a story that quoted a number of melania trump's friends, saying that after the stormy daniels and karen mcdougal stories came out, there's much more distance between the president and first lady. they've always been separate bedrooms, they spend very little time together. but what i would expect from her and she's going 0 to make an announcement on monday about some of her new initiatives, is to extend her anti-bullying campaign to her husband. he's the bully in chief. you know, a lot of bullying is j

jonathan: from new york city for our viewers worldwide, i am jonathan ferro with 30 minutes dedicated to fixed income. this is "bloomberg real yield." ♪ jonathan: coming up, it is a breakdown on international diplomacy. enough to derail global growth? the central bank of e.m. is in a world of pain, asking the fed for help. and the ecb refusing to be held hostage and planning to discuss the end of qe. we begin with a big issue, emerging markets asking the fed for help. >> the fed is always clear they are making policy for america. but even if you do consider the rest of the world, you are not making policy to bail out countries that are running their economies badly. >> the fed is guided mostly by u.s. factors and it would take a massive global crisis to change the fed's behavior.

for a comprehensive win ok so the plot thickens there and we look forward to seeing what happens jonathan i understand you actually on another note you have a chance to get an activist who's been fighting to the right for women to enter soccer state stadiums in her native ron tell us more about that. indeed going through a football match is something many of us take for granted but for women in iran the reality is very different because since one thousand nine hundred eighty nine they've effectively been barred from going into the stadium as you said i met with an activist omarion you might have seen it on t.v. holding new ban for women ban and she's used this woke up to campaign against the stadium ban in iran and this is her story. i became interested in football when i was and when i was a. kid because my family. i'm very passionate and football isn't like sick like religion in iran and everybody watches that but. half of the population are not able to get in and since then. immediately after divorce cup in brazil two thousand and fourteen i create my campaign. i mean woman should be a l

jonathan: this is something i wrestle with a lot because they are so similar. on the surface they seem like they are leaving for the same exact reasons. the difference for me is the context in which they come. so in a classic study of desertion, where she concentrates on white soldiers, she has a flu -- a few on black soldiers, she talks about independence board in 19th century men led them to think they could leave. over the course of war they developed a sense of military duty that kept them in service and make them understand, where they started to appreciate what becoming a soldier was. there was never an ideal soldier. they kind of learn through that. soldiers similarly were soldiers in becoming, learning about what they were doing at who they were supposed to be. the major difference was these men had come from enslavement, so they were fighting against a context in which it seemed as though it was enslavement versus violation of liberation. >> you mentioned many of the usct deserters returning to their families in the south. are there cases of them being

jonathan: i think there's complacency about overheating. they are forecasting that. ery skeptical. i think there's complacency in the credit markets. weare doing a lot of things did back before the crisis that we said we would never do it again. we are seeing a lot of it. we are seeing corporate leverage grow significant a. you have tremendous amount of issuance over the last 10 year. -- years. the maturities have extended out quite a bit. corporations have taken full ofantage of long period credit spreads. maybe that -- we have seen the best. i think there is lots of complacency. it is less about the trade issue and the more about some of these other things. julia: those two things are tied. inflation surprise, the fed tightens quickly perhaps been investors anticipate, that tightening effect, whether it is on the real economy or borrowing costs which could precipitate a greater slowdown but then creates problems for all the reasons you mentioned. given the mass iss have from a sovereign level and from a corporate level. when does that kick in? jonathan: i think it m