when you look at inflation, how should mark carney see it? that 2017 we will see inflation above the 2% target. mark: you would look through that. a period ofneeds proper growth and that might mean higher prices, high consumer prices which in turn, let's not forget the real bear for the economy's wage growth, which has been missing in action completely. if you are of the opinion to allow inflation to remain at the book target which in turn would lead to wage growth, that may be a price worth paying. francine: what is the one prescription to look through and where does inflation have to come from? if it is because you are this isg more goods, maybe something they should not look through. mark: there are a lot of reports recently saying the alleged impact on and sports and exports of a weaker currency does not pertain the way it used to in the past. i think the bank of england would look hard at that and say sterling was 1.60 on brexit even and it is now 1.30 so it must have an impact on trade. they may be coming to the conclusion that economist

what will you be watching for in mark carney?guage, forward guidance, concern about inflation? brian: he's going to stress, i think, that there is a lot more easing to come. although we started to get the first hints from the surveys, they need to see a lot more evidence to know how they are going to calibrate their response. the fact that he gave this very strong statement in his 30 june speech that they are likely to act so early tells you that in aggregate, they want to do a lot of easing. this is the start. francine: what does it mean for how the ecb looks at what the boe announces today? brian: to the extent that the bank of england message is one of big risks to growth, that is going to hurt the eurozone as well. it brings a downward risk to the ecb forecast. francine: brian, overall, what is the one thing people get wrong about mark carney? brian: there's a leading question. i think people take his signals, his guidance too literally. i think his forward guidance, the first phase was an unmitigated disaster and he should h

u.k.nor mark carney told banks they have no excuse not to pass the rate cut on to customers. st boe decision will affect banks, let's get to mark gilbert. great to have you on the program. we spoke to you yesterday. i was surprised that marconi was so adamant, saying we will not go into negative rates. the banks keep arguing they are not lending because there is no demand per he says there is no excuse -- there is no demand. he says there is no excuse not to pass it on because i have cut rates. mark: he got angry. when he was asked about banks, it was all most like he was staring into the camera lens and talking to the ceo's of british banks and daring them not to pass on -- they are behind. their business model does not work. the deposit account rates do not work. they cannot make money with rates this low, and it is not clear how they are supposed to stimulate demand in this environment. francine: let's listen to the chief financial officer of rbs. >> we are the biggest commercial bank in the country. we have seen a slowdown amongst a corporate customer base, stalling decisi

time, followed by mark carney tsipras caverns a half hour -- mark carney's press conference at half hour later. later, mark raises its full-year forecast. we speak to the cfo after the market opens. still to come, we spoke just we talk record low rates to the former head of the uk's financial services authority. this is bloomberg. ♪ anna: a beautiful morning in berlin. currently seeing some optimism on the dax, up .6%. let's get you up to speed with the bloomberg business flash with juliette saly. toiette: caroline, thank you toyota motor has cut its fiscal year profit forecast after net income fell in the first quarter. the automaker said profits will drop to $40.3 billion for the year ending in march. that is as cheap feel pushed u.s. demand away from its car lineup while a strong yen cut earnings from vehicles overseas did -- overseas. merck has raised its full-year earnings forecast as it posted second quarter profits. , andngs before interest excluding some cost rose 89% to 1.1 6 billion euros. marcus cannot you will join us after 8:00 a.m. that's marcus kerr not -- it can ship roug

mark carney seems adamant that negative rates will not happen. could things change? ross: it's always possible. the economy deteriorates to such an extent negative rates are deemed to be required. it's the erratically possible we could go there. the qe -- it is theoretically possible it could go there. economy is weaker than expected we will see more qe possibly buying other assets, more corporate bonds. to get to a negative rate environment i think you're talking about at least 12 to 18 month before that could be considered. i think they will do other things first. vonnie: members were split on the increased acuity and the resumption of it. itshe bank overstepping lending? ross: the corporate bond purchases, these are riskier assets. they will sit on balance sheet -- they have the approval and authorization of the u.k. treasury. one of the things that made us a little skeptical about the possibility of corporate bond purchases at this stage. we thought maybe the chancellor might want to announce this initiative in his autumn statement. it has come sooner so that is

that is what mark carney and his cohorts are dealing with. hard, theturning into backdrop is pretty cup. the biggest one-month fall in the services of the 20 year history of the reading. a rate cut of this, pretty much a shoe in, 25 basis point. but a month ago when i was here, that is what i was saying to you. i think it is about the a la carte, on the menu, will they go ?thequantitative easing lms are split. one of the risks of doing nothing, bill gross had a warning. bill: i think the market expects them to cut, and if they did not cut, they would be near-term chaos. currency markets, so, you know, they move along with the fed, and a move along with the boj. manus: interesting perspective there of course from bill gross in terms of the currency market. in terms of those expectations, the bloomberg survey sees growth falling 6/10 of 1%. gdp could be flat. and the ability to actually see inflation below the 2% target, well, that could burst out about that. a whole range of issues to deal today. anna: i really like the line from our colleague

mark carney says it could not be worse -- lothar: sigil bankers are turning up negative rates don't doing. why would you want to go toward negative rates? mark carney made it clear last week that it is not in the gift of monetary policy to get the , ifntial of the economy that is a political issue that needs to be addressed. it is good of the central bankers to get that message out that they have getting toward the end of what you can do with rates. it is a dangerous game because in january that was one of the reasons we saw the massive market selloff. we run into trouble in the economy globally. backlash that is why the link which is still fairly careful. at the moment, at least we've got some tailwinds from the global economy. francine: currency wars? we are not. so yen can do whatever they want. lothar, thank you so much for now. he stays with us. we'll be talking more about u.k. we'll be talking later on to the ceo of potential. we talked to the e.on cfo. it writes off billions. after that, the interview i was talking about with the ceo of potential, mike wells. we understand that

did mark carney throw enough at it to avert a recession? did he do enough?> i'm not sure he is not enough to revert a succession but i think it is a darn good start. it is clear this is an opener and the minutes actually say a majority of members thought they probably could have cut even further. , so -- so, this is a cut in rates. the one thing i think he made a big error on is not doing negative rates, which probably was not a smart idea because he may well have to go there and the danger there is than if he does go there people panic and say this must be really bad. but i'm not sure if he has done enough to avert recession. we are going to wait to see is whether the new chancellor is able to do anything. we will see. point, i do great not want to talk over that. as far as negative rates, it is kind of controversial. they have not proven out so well in japan or in europe, certain not for banks profitability. what you think about that decision? >> i'm very sympathetic to the notion that negative interest rates are sufficiently peculiar. you do not use them

when we were there, there was a lot of noise, a lot of political noise about mark carney.was getting some grief for weighing in on the brexit vote. and being too political about that. has that blown over? >> it's an interesting question, sara. he suggested it will be a catastrophe on the uk economy. they've had to roll back, haven't they, but i think the government now is more focused on not hitting deficit or surplus targets here. they're going to provide more fisc fiscal stimulus. providing more stimulus here as well, but also dialing back a bit on the fear factor that was introduced ahead of that vote. we'll see what he comes up with today. >> all right. thank you so much for that. certainly a big market catalyst coming up. >>> coming up on our show, is it a business bogey. a big deal in the industry. you're watching cnbc first in business worldwide. what's it like to be in good hands? like finding new ways to be taken care of. home, car, life insurance obviously, ohhh... but with added touches you can't get everywhere else, like claim free rewards... or safe driving bo

how mark carney is getting crushed, here is mike amey. what the bank of england said is, we will sorted out in november. mike: so what they said is that they failed to buy what they try to buy yesterday. is another buying program today. so if they wanted to make up a shortfall today, they could have done that. we don't knowsay, why we didn't buy the bonds yesterday so we put that one on the back burner for a couple of months and continue with the program as it currently is and workout when we will buy the extra bonds. to my mind, that is an interesting dynamic. what that tells you is that if they were reasonably confident this was a one-off, the thing to do would be to say, fair enough. we will move off. more nuancedit than that. and it indicates to us that it will be a challenge to buy these bonds. this is a bit of a warning shot. are soe: if they attractive and people want to hold onto them, will it change the dynamic and how the government issues bonds? mike: attractive is a relative term. [laughter] francine: least ugly. the issue is,

he responded to what mark carney did. let's talk about what other news .illiam hill giving us their earnings. 2016said the euro tournament generated a total 36 million pounds gross. immediate priorities continues to be recovery of their online business. the impact of brexit on the u.k. economy is unclear. talking about falling mortgage volumes and a slowdown but not something you would call a recession. back to the william hill story, rank and aaa are trying to buy william hill. that is a business that is bigger than the combined value of these two. they'll be quite a big business for these two good we'll see of they manage it. 60 million pounds worth of shares that share buybacks. they're not seeing any reference to that the to offer from rank and aaa. manus: we got equity markets bouncing higher, picking up the theme from asia. let's have a look at some of the -- on our risk radar could anna: the pound in their. manus: down but not out. the best way to put it. -- bouncing cable up to 133 if the stainless works and put the baseline under the -- 10 year go

francine: what kind of grate would you give to mark carney at the moment?onth as andy fantastic but said earlier this week, you cannot rely on the central banks to do everything. economying to reset the . all the risks we are talking going to need the government to seven -- step in. is this a mistake? u.k. economy, from 2010 two thousand 10 to before the brexit referendum actually grew at the same pace of the u.s. .abor market i think this really is a brexit issue now. one of the things people have not picked up on is the impact of lower gilt yields because of it is going to deliver a big fiscal win towards the government. particularly because we have issued a lot of debt in the last few years. you might see deteriorating public finances but you will see an offset in impact from low interest payments. that might give them more room at the edges to spend more money on infrastructure and cut a few taxes. i won't expect a big package because he will feel constrained by how far he can go but he might have a little more room. do you think the example of places l

negativel be noted test no negative, mark carney says.nding program, sterling falling against the dollar, the euro, they can. down against the dollar. and historic for the bond market as well, talk about what happened to the yield on the 10 year and the 30 year. both hitting record lows after this 60 billion pound bond buying program was announced. that will take place over the next six months. it will take the bond purchasing pounds.to 435 billion we have got more breaking news on, day. vonnie: monsanto and buyer. people familiar with the matter are saying the financial account of monsanto could pave the way for buyers to make a bigger offer. it could raise $55 billion takeover. the stock, if you look at monsanto, up 1.5%. at the close in germany, buyer was down 0.5%. conduct do dividends on monsanto. there will be a few more weeks. mark: it is a fascinating industry. we have seen china down, the buyer of course. rejected from the company, from that company. and it seems as if they have come back, bsf. it isn't evolved in this whole chem

britain's finance minister has welcomed the measures by governor mark carney.overnormmond says the will be revealing the impact of the brexit vote on the economy in the coming months. >> the governor has made clear that he still has monetary policy available to him to provide further support to the economy, if necessary. we approach often, we will consider whether there is a need for a physical response. to build anmined economy for everyone. right now, we are trying to protect jobs and economic growth, and the measures taken today are designed to ensure that any increase in him -- in unemployment as a result of the economic slowdown is kept to the absolute minimum possible. host: let's get a check on how the markets are doing this thursday. in london, the ftse reacted positive. it is in the session with gains of over 1.5%. paris ended in the green, up over half a percent. in the united states, stocks are trading at a flat line. the nasdaq up 1/10 of 1% at this hour. investors also keeping an eye out for the u.s. jobs report on friday. the number of people impl

now governor mark carney said the easing program was aimed at stimulating lending. >> the purchase of up to 10 billion of uk corporate bonds will support the real economy by directly affecting the financing conditioning for companies that make material contributions to uk economic activity. by supporting investment, this action should improve the monetary policy tradeoff with inflation. by acting in capital markets it will be complimentary to the enforce the bank lending channel. by lower credit premium bonds are a prosht mean of providing stimulus. >> governor also addressed how low rates would two and whether they would consider heading into negative rate territory. >> no on the negative rate scenario. if anyone just write in whatever you want to take that off the table for me. okay. there's -- i'm not trying to be clever in the way i'm answering that question. >> now rbs last week warned its business customers about potentially passing on negative rates. earlier today asked the bank cfo to the reaction to the bank of england move. >> we're obviously pleased at any measures that are

we'll bring you some of the key economic data mark carney will be watching.his is bloomberg. ♪ francine: let's get to the bloomberg business flash with nejra cehic. nejra: uber will emerge its chinese business -- that is according to people familiar. they say the new company will be valued at $35 billion and they will continue to operate its own app in china. china is considering a sweeping overhaul of its steel industry which would consolidate major steel producers into two giants. that is according to people familiar. the nation's biggest mill by output and show them group will be combined into northern china steel. shanghai and wuhan ins deal will be merged into sovereign china steel group. shawnee -- sony shares have risen after the company posted a profit. analyst we surveyed were expecting a $308 billion loss. the playstation division outweighed the impact of the earthquake which shut the main mammoth -- the main manufacturing -- nintendo has fallen after the hit game can one go dropped in japan. last week, shares posted their biggest decline in more th

unfortunately mark carney jumped the gun and hinted in this direction. the mpc has sort of been backed into a corner on this. i do not think it is necessarily the right decision. jonathan: it appears the split was on rates and -- not on rates that the qa program. the bank of england downgraded to the most ever. we have this policy dilemma. you have unread -- upside risk to inflation, downside risk to growth. is it the wrong thing to focus on output? andrew: we do not know that the inflation impact will be transitory because the shock of leaving the eu is the shock on the supply side potentially reducing investment. that is something that really needs to be factored into these forecasts. i think the main point i would make is that we are reaching the limits of what monetary policy can do. at some point, central bankers need to turn around and say, we have done enough. we are not the fire brigade, we do not put out all the fires. if i was on the mpc i would have been arguing to wait for the autumn to see how the government responded, with the autumn statem

but this is not a mark carney thing. this is a bank of england thing.y prepared to look through periods of inflation as a result of temporary factors, such as the massive depreciation in the sterling. since lasttion november. that will push inflation, in my model, up towards 3% 12 months out from today. i expect the bank of england to look through that. they are in stimulus mode. francine: and the options yesterday did not go badly. they found enough stuff to buy. simon: they did. was a hiccup.rst $50 million short pier 1 you saw was the market was quite a in terms of volume for parts of the summer. and it was not used to qe. been outof england has of the market for four years. it was just trading desks. a lot of the work done by the bank of england to warm up trade ahead of yesterday's auction was successful in terms of coverage. francine: what are you thinking for retail sales? , we areetail sales looking at around 4% growth. indicator ofged the return of real wage growth, the return of decent summer weather following a difficult start to the summer t

when you look at the numbers from mark carney yesterday, we were quite pleased. the numbers were broadly in line with our own estimates. cfo ewenthat was rbs stevenson. still ahead on bloomberg markets, as donald announces his economic advisory group, we will take a look at some of the company that he kept before he was the presidential nominee. this is bloomberg. ♪ scarlet: jill stein, green party presidential candidate, will join bloomberg from the green party convention in houston on her attempt to win senator sanders supporters. and a donald trump advisor will join us from washington for his take on the jobs report. both conversations begin at 2:00 p.m. eastern donald on politics, today announced his economic advisor group, including steve roth, harold hamm, and tom barrett. who trump surrounds himself with is one of the top stories on the bloomberg, called "the company donald trump keeps." joining us is the article's author, tim o'brien. tim is also the author of "trump nation." we need to give full disclosure here -- tim: donald suit me in 2006 over the boo

mark carney said the bank of england would potentially introduce qe.e saw those bond yields not just in the u.k. but around the world fall and we saw equity markets respond to that in a positive way. anna: we heard comments over the weekend from central bankers. we also heard calls for horse fiscal -- for more fiscal stimulus. do you buy into this idea that we will see more fiscal stimulus? are you making a strategy around that? is a little too early to get extremely excited about fiscal policy in the sense that they are just starting to formulate arguments around it. we are going to very much look ahead to what the bank of japan in to say about it september. there are scenarios around the u.s. election where we could see some increased fiscal spend, perhaps of hillary clinton is elected. there is one key point that is important to focus on today and that is mark carney, and talking after brexit, said we will not take interest rates below zero. the market responded positively to that. the market thanks, mark carney gets it, there is a limit to monetary

mark carney honesty would never go negative, but he may have to. >> yeah. guess he will search a long way to find a banker who is enthusiastic about negative interest rates. i don't like the idea, either. i'm afraid going back to our conversation five minutes ago, i am personally in favor of trying to lift over time the level of inflation that we target, because my concern is that negative interest rate set up all kinds of perverse incentives to hold excess cash, which is , and they alsog mean that the central bank is not really in control. once you reach the lower band you don't know how the economy will respond and you are pushing on a piece of string the banking system. i think what we really need to learn from this is that we probably got used to trying to target an inflation rate which is so low that for quite a large period you may find yourself at the lower end and out of control. tom: sir howard, you know as anyone the idea of momentum and inertial force. i look at negative rates as a chronic x-axis. it is not that we are at negative rate, it is how

because mark carney is speaking at a press conference.t and apparently exceeded the market expectations announcing a series of measures in response to brexit, the decision by british voters to leave the european union. called it a, quote, regime change and said monetary policy cannot fully jaup receive the brexit shock. but the bank of england will do whatever it takes as necessary in monetary policy. >> we cannot immediately or fully offset the economic impacts of a large structural shock. however, monetary policy can support the necessary adjustments of the uk economy. during a period of heightened uncertainty. >> so the boe also cut its inflation and growth forecast. markets reacted around the world. look at what the british pound did here. i don't know if we have that. do we have that chart? there we go. the pound getting pounded. we've been able to say that over the past month or so. then a reaction in the 10-year gilt. we went in at 80. we're not 68. yeah. still right about 11.5. i don't know if we have the full screen with the tota

mark carney three weeks ago declines to cut rates, waiting for more hard evidence.o we have it by thursday? oliver: what is interesting with the markets position, we were talking about this at the beginning of the show, there is physically 100% certainty on behalf of traders right now saying there is going to be a cut. anytime that happens you start thinking about the risks. is it going to be to the upside downside on sterling? sterling basically flat after the drop-down post brexit. it opens itself to big moves. maybe ity do cut but is by different amount or there is not additional two-year stimulus measures announced as well. scarlet: if you go inside my bloomberg and look for the united kingdom, 98% on some a rate cut for august 4. you can take that back to, say, july 13, and the odds of the rate cut back then were 82%. oliver: exactly. joe: if you go inside my bloomberg, i brought up today's latest manufacturing pmi and i showed it in two ways. the blue bar is the month over month change. we have not had -- this is going back all the way. this is the biggest dro

mark carney yesterday really got upset when he was asked a question about savers. mean for the sabres of america? bill: it is very much of a negative. financial repression. and carney bankers several days ago expressed the view that jobs and growth will take care of the pension problems later. i suppose that is not a bad way of looking at it. but we have been into this for five or six years and are beginning to see erosion at the margin in terms of business models. it is not just insurance companies. it is banks in terms of profitability. j.p.m. does not earn as much as before? not necessarily. ultimately, these financial institutions suffer. they are a significant part of the economy. capitalism needs a balance. at the moment, the balance is imbalanced because asset prices arehigh and liabilities significantly overwhelming their business models. tom: bill gross with us on bloomberg radio. good morning on bloomberg television worldwide. metlife, tobacco, and real jobs being lost. the actuarial assumption is essentially a careful calculation of how much you need to m

i'm sure mark carney will address it why it's happened, but i know there are some traders in the markett more than 25 basis points at this meeting, we might actually see the pound off the back of this meeting and take back some of that early easing. back to you. >> it's interesting that moint given the prices are higher. they've been even kinder since the vote took place. >>> you can head to our website to read the full prove of the bank of england decision. that's on cnbc.com and stay tuned because we'll be bringing you live coverage of the decision from the bank of england at 11:55 bst. >> one of these instances where the press conference could prove more interesting than the decision itself. >>> joining us around the set, richard, ceo at wealth management. pleasure to have you with us this morning. jeff was just walking through the various options that the boe has at its goes sdisposal. is there a chance investors can get disappointed here. >> there is a chance. it's been so well trailed. as we saw the committee itself made a statement which seemed to imply almost a certainty of a cu

we see mark carney at the bank of england girding for an impact and not shown up in the data. mate yet wash up on the shores through an impact through europe or britain. >> steve, before you go, there have been rumblings throughout the day maybe seasonal adjustments distorted the jobs report to the upside. i already see you shaking your head. so what is your response? >>dy the math on it. let me -- bill, let me ask you a question. did you see anything of the past five months when seasonal adjustments took away 3.1 million jobs? >> well, you know -- >> nobody wrote a thing about it but the people talking about this thing about -- >> exactly. >> by the way, i checked july for last 17 years. this number is 30,000 jobs under the normal adjustment for july. >> you're the economist. i just play one on tv. my question is often, when they start to talk about seasonal adjustments for this report, why didn't they do that in may, as well? >> just like you are, an excellent journalist, why more people subscribers to this nonsense conspiracy theory are not asking tougher questions is alway

markets we will get mark carney's take.or media earnings, fox and viacom shares both moving this morning in different directions. what's behind the quarters at fox and viacom, what about the turmoil. frankly at both companies. tesla misses estimates, but that didn't stifel, what is this all in the family, stifel elon musk's optimism. we hear his outlook for the company's future. futures on the rise a bit this day after the dow broke that seven-day losing streak. the bank of england cutting its benchmark interest rate for the first time since 2009. from what was 50 basis points to 25 basis points. the bank also ramping up stimulus measures and restarting its bond buying program aimed at offsetting economic fallout from the brexit vote. governor mark carney at today's news conference in london. >> the bank of england continues to stand ready to take whatever action is needed to achieve its objectives for monetary and financial stability as the uk adjusts to new realities and moves forward to seize new opportunities outside th

i think mark carney was smart, using foreign guidance. most of the committee thinks we are going to go lower by the end of the year and even though the positioning of sterling is extreme in terms of some of the lowest short position we have ever seen in the current the, i think as we get some kind of look at the hard data to show the scale of the actual slowdown in the economy, not just the survey data or backward looking data. as that comes out in the scale of the slowdown reveals the health, i think the sterling will go lower. francine: i know tom will ask you more about the markets but we heard from ian mccafferty saying he wants to wait and see. i do not know if this fills you with confidence but he is waiting for signs of what brexit entails. they have not started negotiations. david: i think a couple of things. they had to act at the meeting and had to act fairly aggressively to get in front of a slowdown that they do not know what it will be like. ok.ink it was quite it is ok to sit on your hands the next and wait for report, and y

what will mark carney have to say at 9 a.m.?le inco pushes its treasury holdings to a two-year-will european and japanese buyers snatch them

the pound as well after mark carney big stimulus passage yesterday interest rate cut buying of corporatend sunk the pound 1.5%. getting a bit of a rebound. then i would also point you to the dollar yen where we are seeing yen strength by a quarter of a percentage point. >> still welcome back to that 100 mark. >> not where the jaep woubank o would like to see it going. >> it's well off the lows we saw post-brexit. >> sure, not in the 120s, but way further from if 150 where we got the night of brexit. as for gold, there's the chart of gold. a bit of a bounce. not much. 130 this morning. has been going in the opposite direction toch dollar. >> all those play in today's top story is the jobs report. three things to watch for what i call the gran daddy of. >> it is my favorite friday of the month. first the numbers unemployment is forecast to take down slightly at 4.8% with the u.s. expected to add 179,000 jobs last month. that's putsing the economy near full employment. the job growth is expected to remain stronger through most sectors. however, energy and trade sensitive manufacturing remai

bank of england governor mark carney appeared destined for your confident the country could whether the tough times ahead. >> the u.k. will redefine its movement of openness of goods, services, people, and capital. it may prove difficult and many will take time, but the u.k. can handle change. >> alongside the interest rate cut, the bank of england is also reactivating its quantitative easing bond buying program. the bank announced it will pump and extra 70 billion euros into the economy in a bid to stimulate growth which will likely be much needed. the bank of england has also revised next year's gdp forecast downward to stand at just zero point 8%. the steepest decline in almost two decades. >> as someone who has been watching the rates decision with great interest, he joins us now. what has been the reaction to the bank of england's rates decision there on wall street? >> it was a pretty big change that we saw. everyone expected that interest rates would be cut, but the bank of england also will start a bond buying program for corporate bonds also. that came as a bit of a surprise .

what will mark carney have to say at 9 a.m.? meanwhile inco pushes its treasury holdings to a two-year-will european and up? ese buyers snatch them some see trump for market is an assassination threat to hillary .linton .5 of 1%.off you're looking at the euro stoxx 50. we are keeping a close eye on some of the earnings coming through. a significant drop in that profit. we are seeing some big write-downs but we have to keep an eye on oil. that is pinpointing this risk aversion today. guy: the german dax is up 2.5%. the story is where it is happening with the dollar. you can see this on my gmm function. that is rippling through what is happening in the commodity complex. gold is reasonably well bid. good story continues to be what is happening in fixed income and what the bank will say it 9 a.m. -- at 9 a.m. in london. let's find out what is going on. trump is causing controversy yet again. the nominee told a rally that what he called second amendment people, those who back gun ownership could stop democratic rival hillary clinton

we look ahead to mark carney's post brexit plan. this is bloomberg. ♪ manus: welcome back. equity markets. we have the stoxx 600, down by 0.5%. we are waiting for shinzo abe to deliver his stimulus. if you dig a little bit deeper into the stoxx 600, commerzbank is the most dominant. results misseder estimates, but without the fourth quarter revenue rising by 3%. that is a little bit of a shock for them. commerzbank, scrapping their four year target. profit missed margins under pressure. ba the upside, we have got b aviation up by 6.17%. but the dominant theme here is europe is taking a pause. we are waiting literally to see what the fiscal response will be from japan. that could set a roadmap for global equity markets. we now have your bloomberg first word news. reporter: manus, thank you. the hong kong stock exchange canceled trading for the day. and flights shut were grounded. hundreds of people thought refuge in temporary shelters. warren buffett has ripped into donald trump, speaking at an event where he was campaigning for hillary clinton. he attacked the republican pr

mark carney says he is not in favor but others are. where do you stand?think we have a company it happensou -- if we will make the most of it but i don't have a strong opinion. guy: fair enough. thank you for taking the time to talk to us. david stevens, admiral group ceo. david didn't want to talk about it, but other certainly are. we spoke to paul krugman of the effects of monetary policy on the economy, and despite unprecedented experiments, the effects, he says, have been limited. >> i think there's an accumulation of evidence that monetary policy is pretty ineffective. he came into this inking monetary policy was an effective and then along came qe and turns outates -- there are all these other things that central banks can do but doing very much. ritchie still with us. has monetary policy run its course? >> i don't think so. there are tools that are open but at th the question is if they use them. creation,mes to money i think it is a question of where you decide to put that in the impact it might have on inflationary trend we have seen purchases of

mark carney and the bank of england suits most of that activity. it wasn't the data point to my opinion. if you look at a one-week chart of the pound versus the dollar, this is interesting. the pound is slipping below the range that would make sense. now, if you open the chart up to pre-brexit, something should jump out at you. even though it is moving outside that range, it is nowhere near challenging the low close from post-brexit with a 129 on the 7th of july. the last chart, mark carney said one thing i love. he doesn't want negative rates. doesn't like negative rates. but the problem is there's not much separating him from negative rates. look at the chart of 20 years for their two-year note in the uk. 11 basis points. not a lot of insurance. melissa lee, back to you. >> rick santelli, thank you. let's talk nike. the company's co-founder sitting down exclusively with jim cramer to talk everything from golf to spotting the next mega endorsement deal. >> our endorsements, at least at nike, we use a very sharp pencil and we pass on endorsements f

goes back to brexit, what mark carney did.emocratic. tom: very good. let's look at the bloomberg right now. this is some of the economic data this week. productivity. this is a cool chart. this is the four-year moving average of productivity in america, with the negative touch in the 1980's. this is back 60 years, back to eisenhower, and the latest roll over in productivity. truly one of economics, looking at the efficiency of capital, labor, and total factor productivity, a raging debate on this decline in american productivity. francine? francine: this is what i picked out. this is on the back of that opec news. at oil, and ignore the right -- the white line. if you look at wti, it is in blue. the purple one -- you can see this list in the last couple of days, they have a new opec chief in place, and opec, planning informal talks next month. we have a similar situation to this about seven months ago where the markets were hoping for some kind of coordinated action, which they never got, which is the u.s. rate count here. tom

c+sv exit b boost for mark carney cutting a record locomotive officials signaling stimulus.ome back. oil rebounds to $40 after a rally in asian stocks. and no longer moving, tesla's elon musk assures investors sales are intact, despite missing estimates. a very warm welcome to countdown. i am edwards.

they look at whether mark carney should look at nominal gdp or inflation target and it was unclear, tould work better. michael: it never felt that either would work better, but his if what raised we are doing now is not working, we should try something new. he says the neutral rate has come down so far, he is at about zero with his estimates, that you cannot cut rates if you have another slump low enough to try to get inflation up, so you might as well try something different. the next and we have a slump, you are in trouble otherwise. tom: where is our belief in wage growth right now? michael: it is starting to pick up. that has been an article of faith of the fed that it is going to keep happening. tom: i agree. michael: in ben bernanke's essay, he talks about the curve. he still thinks it holds. it is just happening so slowly. tom: fascinating. williams, who is a very different economist to me, this is a big deal. michael: williams was janet yellen's chief researcher at the san francisco fed before he left so he carries a lot of weight. tom: frankly, catching up with michael rowley

angie: the real sentiment is whether or not mark carney will economists do as expected. going to take a look at hard data. it is hard to factor in brexit when the negotiations in article 50 have not been implemented yet. scarlet: exactly. driven.all sentiment we've much more coming up on bloomberg markets. robert kaplan, president of the dallas federal reserve, will be speaking. why he thinks september is still on the table. this is bloomberg. ♪ >> is 1:00 p.m. in new york. welcome to bloomberg market. ♪ >> from bloomberg world headquarters in new york, good afternoon. scarlet: good afternoon. here is what we are watching. u.s. stocks heading to record highs despite energy shares getting slammed. fresh concerns the fed will not hit. >> we will hear directly from -- he says it could still be on the table if data supports it. more highlights coming up. scarlet: we are watching china. economy watchers scratching their head after many entering in july. we're looking at the tale of tea does emi's. halfway into the trading day, the markets desk where julie hyman has the latest

the rate decision out at 7:00 following mark carney's conference at 7:30., 100%, the probability of a rate cut. >> the first one since march of 2009. if it does come out that way, an exclusive interview with brian moynihan, the bank of america conference the news that comes 25 or 30 minutes after the decision, which we will have right here on bloomberg. what the impact is and what you pay decisions have on bank. we talk about particularly on europe, we want to get his take. it is what they do. there is a lot more to learn from mark carney. >> that does it for bloomberg . thank you very much. bloomberg markets is coming up next, in new york from our viewers worldwide, this is bloomberg. ♪ matt: live from the town manhattan, i am matt miller. barton.am mark this is bloomberg markets on bloomberg television. ♪ >> nonmanufacturing index, the measure of the services economy coming in at 55.5, about in line with the 55.9 that economists had estimated. this lowdown from june passes reading of 66 and a half. from 56 and ahigh half from prior month. anything abo

looking ahead, how embarrassing is this for mark carney that he cannot complete what he needs to do in qe program? >> i guess he will say it's early days. we will see what happens. i would not be surprised to find newiltshe agency issues to satisfy the demand and give mark carney more bonds to buy. i think he will get done what he needs to get done but maybe not so easy in credit. that will really test the market in september when he starts getting toward the 10 billion target he has a buying credit. it's hard in gilts, to buy on credit. oliver: if they extend the bond , where willam investors go to get the yield? will they continue to come to the u.s. or take that money and go elsewhere? >> we are calling this the halo effect. grade is thent first port of call and then you will look at u.s. high-yield and emerging markets a and esoteric instruments liket-1 bank debts. this will pick up and be bought by investors hunting down yield. we have seen this out of asia and awful lot the last couple of months. aen in europe, we are getting lot of mandate to pitch for the u.s. team. if you want

mark carney said the institution would be able to look through this bout of inflation. finition of iteration in terms of trade and normally this shock is short-lived. mark: is it wishful thinking saying that the bank will cross nhe 2% inflation threshold 2017 second quarter? do they maybe need to bring that forward? gilles: the procession in the currency has continued after the latest bank of england's actions so it could generate further inflation down the pipeline. at the same time, there needs to be some sort of fiscal accommodation of the shock. i agree with the idea that there is a strong case for cutting the rate and trying to offset some protectso as to consumer spending because this is the shock that has almost a one for one on spending because wages will not catch up, at least not quickly or entirely. if you want to protect against suspending and at the same time, you have to counteract this shock, you cut the rate for 12 or 18 months. vonnie: that is up to the fiscal authorities, i guess. how does the bank of england respond going forward? today it was successf

is mark carney too quick and throwing tools out there? richard: i think he has been too quick. quite surprised. when they make policy changes, they did not improve the economy immediately. they improved the economy in six months to a year and longer. to be trying to make policy -- francine: if you look at the -- data dependent it means you adjust on a monthly basis. richard: i think that is a problem with policy at the moment. a longer-term view of where they should think interest rates should be in one to two to three years time. it is quite interesting that we did have the policy and measures announced by the bank of england last week which were pretty meaningless. i cannot see how a quarter or additional -- quantitative easing, how is it onto feedthrough to the real economy. had we had interest rates slightly higher to begin with, had they been at 2%, then a cut would've been more meaningful. francine: is it a problem with the policymakers? or is it a problem with an economy that we don't understand how you make it work? it is crazy when you think about all of the qe we put

today's days until the next bank of england meeting, we will bring you the latest pmi numbers as mark carneysses the economy six weeks after the exit vote. this is bloomberg. ♪ francine: oil trading near $40 a barrel ahead of the u.s. weekly government stockpile data later. crude fell into a bear market yesterday on the concerns that the glut will could -- the glut will persist. here. blas sarah hewin is still with us. how the year, great to see you. the bear market will continue because the seal producers can turn the caps on quite quickly, it will go back up. --ier: none of the oil trade we are going to see the prices we saw at the beginning of the year. we went down to $30. centrally very people -- very few people -- i can add it is most likely where the to be $40k in this -- only around to $45 a barrel for the next couple of months until we see a bit more killer the -- in bit more clarity. september and october going to be difficult for oil. the demand for oil goes down. andnd and increase later that is again held. the narrow band will be with us. francine: you like this? i made it for y

print puts mark carney in a difficult position.eing forced to think cutting rates instead of raising them. >> that is the weakness of sterling feeding through. there are plenty of ford looking indicators telling us of the uncertainty on investments, the impact that will have on activity going forward, so i think he has one eye on inflation, but the other is on a potential slowdown, investment in particular, and how that feeds through into consumer confidence. i think he is more focused on that than one information print come of it does complicate things a little bit. the scenario in the u.k. is not as weak as what you might expect and eigh environment -- an environment of interest rates. rishaad: we are just getting rate, thereference strongest since june, 6.6056. it is reflective of dollar weakness. >> it is really a reflection of dollar levels, though strength, and dollar weakness. i don't think the picture changes in the medium-term outlook as far as the yuan is concerned, that the fixing is partly a factor of what has happened

what was interesting is also mark carney about 10 days ago morning that the banks should be very carefulhe doesn't want the boe to go into negative territory. he's warning banks not to pass on negative rates to customers. let's bring back john bilton. rates, just a reminder, you believe central banks can get us out of this mess. is negative rates, are negative rates art of the solution? john: i think they are part of the experimental toolkit. central banks, much like many economic actors today, are in the experimental drug phase of monetary policy. we don't have a counterfactual to tell us how successful central banks have been. the fact that we have positive growth around the globe, we have avoided a major crisis, we've significantly shored up the western banking system, suggests they should at least be given a b minus for their efforts. whether negative rates are the right and only tool is unlikely to be the case. i think we're seeing the limits of it because of the impact on the banking system. the appetite of effectively charging for deposits or banking services across the border, th

francine: going back to what mark carney has done so far, in terms of fiscal spending, are you happy?you spoken to the new government? things seem to have stabilized. they were messier than expected in the weeks straightly after, but a stabilized. john: i think that is a very fair way of putting it. i think the speed with which the new administration came into place has been a real benefit. normal consumers, all of us see things as not really having changed. look at the economists. there's only one article on brexit in the economists. you would think this would be the main thing eagle would be talking about but we have very short term memories. consumers we might all be going out and spending more, as businesses, we are starting to think about the longer-term impact. francine: and we could see reversals quite quickly. we, like any other corporate, have a team thinking about what the impact of brexit will be. we are hoping for the best but planning for the worst. we are tightening our belts, reducing operating costs, and if all corporate do that, that starts to become self-fulfilling.

(((mark carney, bank of england governor) "we now face a trade off between the degree of the one hand and how fast we return inflation sustainably to target on the other. by acting early and comprehensibly, the npc can reduce uncertainty, bolster confidence, blunt the slow down and support the necessary adjustments in the uk economy. )) ((christianne klein)) >> most economists were expecting a rate cut... but some had expected the central bank to hold off any further action until the government unveils new tax and spending plans in the fall./// >>> hackers converge in las vegas to help tighten cyber security. paul courvoisier)) >> why they say a flaw has been found in chip credit cards. ((christianne klein)) >> plus... it's all the rave in those tv ads... but does it work? coming up at 5... michelle mortensen puts the "wonder slicer" to the try it before you buy it test./// announcer: you're jim: i'm one of them. fermin: yo tambien. barbara: i'm one of over 300,000 nevadans who rely on social security. fermin: social security helps us pay the bills. jim: and enjoy the retirement that

when you look at the numbers from mark carney, we were pleased. were broadly in line with our own estimates. 18 was more positive. markine: boe governor carney urged u.k. banks to start lending again, but if they don't, whose fault would it be? colleague wrote a fictional letter in which he imagined what the banks might say to carney at the end of the year. it's a fun read. he says, the problem is our customers. after brexit, they weren't interested. our lending growth is going nowhere. he's now with us. it is funny, because you say merry christmas. it's a little bit like bloomberg. the banks actually put charts in it. also with us, john wraith from ubs. thank you for sticking around. it's a fun piece, but it goes down into the heart of the problem, which is, this country needs the banks to lend to make sure that there is not a supply chain disruption in money supply. and the governor yesterday said banks have no excuse, but we heard the rbs cfo's excuse. there's a demand issue. this is a bank that is owned by the government saying, we have been l