get a live report from michael mckee in jackson hole at the bottom of the hour. and also, european central bank president mario draghi speaks at the symposium 2:30, new york time. this is been a boom town in iraq. developers pouring billions into the segment -- into the sector in recent years. but the threat of the islamic state has put these ambitious expansion plans on hold. >> just a couple of hours from the iraqi conflict zone since this small slice of the american dream. kurdistan's first self-proclaimed subdivision. >> how much does one of these houses cost? around $3000. -- $300,000. he is a courteous but this time between virginia and iraq. see most of the developers in this area, even in lebanon or turkey, they start to move to do business here. sank $6 million into this gated community, and received another $10 million for water, sewage, electricity from a private lending arm of the u.s. government. then, sectarian bloodshed hardly encouraged outside investments. but in recent years, the oil economy has helped reveal -- erbil develop at an impressive ra

michael mckee is there and joins me with the latest. pimm, certainly not a day you could necessarily trade on but a lot of information for investors to digest. two central bankers with their economies going in different directions, two different messages for the colleagues and the markets. for janet yellen, and that knowledge meant the economy is getting better faster than she expected which does put rate increases on the table. the timing remains uncertain. act too fast and you risk threatening recover if investors overreact and push market rates up deceptively. act too slowly and you risk accelerating inflation that would force the fed to raise rates higher and faster short-circuiting growth. voluntary --d, monetary policy must be conducted in a pragmatic matter that reflects the ongoing assessment of a wide range of information. mario draghi does not need information. he knows his economy is in trouble, growth stalling in eurozone and inflation is still falling. after a long-delayed, the ecb is acting. he repeated they are willing to

of course, our thanks to michael mckee. he has been reporting from jackson hole, wyoming. coming up, we will take a look at food safety. food packaging in focus with the global leader in all types of packaging, sealed air. you are going to meet the chief executive. with the u.s. open set to begin on monday, i will speak with the vice president of one of the largest tennis racket manufacturers and find out how tennis is gaining thousands of new players each year. ♪ >> food safety. the lack of food safety can send shudders through a population. recent lapses in china and russia have caused companies such as mcdonald's to stop serving certain kinds of food. sealed air is a global leader in protecting food, people, and supply chains. the company has about $7.5 billion worth of sales and employs 25,000 people. it has got a global reach. 175 countries. sealed air's chief executive jerome peribere joins me now. we were just talking about some of the more everyday uses for the products you make. i am wondering if you could describe, how did you come to be associated with bubble wr

haeckel mckee is there. michael? michael mckee is there. michael?wing interesting people on the lower manhattan at the new york stock exchange and elsewhere are wondering what kinds of clues they will get for the fed future policy. they suggested a more hawkish view, maybe an earlier rate rise. one of the people arguing for that is the host here, esther george. i asked her yesterday if she still believes that we need to move sooner rather than later. that will be a function of how the economy performs. that is why the committee has been talking about with the sized balance sheet, how the normalization will work, how the fed funds rate will respond, how we will control short-term interest rates, and that has been the discussion over the last few meetings with the committee. >> one of the controls for short-term interest rates, overnight reverse repos to put a floor under raikes. there have been a lot of concerns raised about how they worked in practice. have you worried that they may have adverse consequences? >> they could and that has been discusse

michael mckee examines how hurta's import ban could its consumers. olivia sterns looks at option plans for sotheby's. let's begin with phil mattingly at the white house with the latest on those airstrikes in iraq. good afternoon. >> good afternoon. wasted littletion time making good on president to get rid ofed artillery pieces and iraq. fighter jets dropped 500 pound bombs targeting a single or tillery peace. the reason why? a president related out last night. take a listen. >> in recent days the terrorist 's have continued to move across iraq and have neared a city where american diplomats and civilians serve at our consulates. , i havethe advance directed our military to take targeted strikes against isil convoys, should they move toward the city. we intend to stay vigilant and take action if these terrorist versus threaten our personnel or facilities anywhere in iraq. officials say that didn't fact happen. artillery was targeting kurdish ground forces in an area where u.s. personnel were. that cause the u.s. to launch these strikes. this is the s

again, michael mckee's interview with esther george, president of the kansas city fed, she is talkingmarket could signal that interest rates should be rising. our twitter question of the day wraps up economics and retail. what will department stores look like in five years? the middle part of the market is shrinking. what happens next? tweet us @bsurveillance we want to hear from you. tom, aj, and i will be right back. ♪ >> good morning, everyone. "bloomberg surveillance." this one, well-timed on "in the the," richard haass, president for the council on foreign relations. not :00 a.m. this morning on iraq and ukraine. this is "bloomberg surveillance." i am tom keene. with me, adam johnson and scarlet fu. >> speaking of iraq, ramping up airstrikes in iraq following escalated tactics by islamic militants with that videotaped beheading of american journalist james fully. willem marx is on the ground in erbil. does it time with what you have heard from people there about the behavior? good morning, scarlet. west of here around the most old am, villagers i've met are terrified of this grou

michael mckee was running through those indicators.nemployment, long-term unemployment, part-time workers. is she so focused on that that people come to the conclusion that she is more dovish than the rest of the hawks and is that perhaps where the different interpretations come from? >> might be. my view is she wants sustainability. the recovery we have had so far is really a financial recovery. -- at least the u.s. is ahead of the curve -- we have seen better economic activity. if you look at europe and some other areas, it is very slow. she wants sustainability. for that, we need a broader level of employment. it may mean that we need to think about structural changes in the economy in the light of the -- what we call the new neutral. i think that would be the second point. how do we address the world that is entering a new phase? slower growth in emerging markets are still growing, but much less than before. the world is driven by consumption, by at least 60%. the consumer has gone through a pretty traumatic development in the past

more names than girlfriends, my friend says. >> michael mckee is coming up next.it is a who's who. michael mckee is in jackson hole, wyoming with a very special guest, san francisco reserve president john williams. john williams did not see the speech, either, so we are given his first reaction to what janet yellen said. if you look at the way the markets are reacting, it seems to be a status quo speech. >> i think she did a great job of explaining the issues, describing the thinking going on at the federal reserve around the labor market, the improvement of the labor market and where we see it relative to full employment and really highlighted the difficult issues in trying to understand was is cyclical and what is trend. it is a very, very good tour de force of all of the issues we are facing. and will be facing in the next couple of years. >> it was an evenhanded, lengthy look at a lot of indicators besides job creation and unemployment that you're wrestling with. some of your colleagues have argued strongly there isn't that much information in this peripheral

our michael mckee joins us now from jackson hole. mike, mr.ed there is no reason for janet yellen to change her messaging, but we know jackson hole has a history of preceding policy changes by the fed. >> yeah, they would like to get away from that. this has always been a more academic conference. they got away from that during the bernanke years. a lot of the bernanke years during the great recession. they would like to get back to the idea discussing things at a 10,000 foot level. it is ironic. i talked with alan blinder last night about the economy and he said the one thing that could derail it is events overseas, and look at what is happening with ukraine this morning, effecting markets even before janet yellen speaks. if that goes away, i asked him then how does the fed affect the markets. that will be the key question going forward. here is what he had to say -- >> nobody should expect that when lift up comes and he said funds rates come off of zero, let's just say sometimes in the first half of 4015, that the fed is going to be having t

our very own michael mckee is there.ia and matt onset is the equity portfolio manager at j.p. morgan private bank. opportunities stemming from management changes. what do you think about hertz? >> this story has had a lot of volatility around it. you have had challenges with respect to concerns around accounting issues in the past. depreciation for cars. it is interesting to see people continuing to look at this. >> if you went to your global equities portfolio manager, to your boss, and said the results i have given you the last three years, i'm not sure about those tell you how can't well i have done in the first or second quarter, what would your bosses say to you? >> it would be a short conversation. [laughter] >> how is this guy still in a job? >> that is that i am wondering. how was the stock up 10%? >> because people are hoping that he is leaving. one of the investors with a 3% for him toit is time go. and carl icahn just bought a 10% stake. when i look at what is going on -- >> when i look at what his on, i lookh

michael mckee in jackson hole, wyoming. >> brian moynihan writing a very big check. bank of america agreeing to pay $17 billion for misled -- allegations for misleading investors in the bond business. geiger here with more on the settlement. we also have michael bowie, a andner at catholic ensign friedman to discuss the allegation. owitz, benton and friedman. >> they have already paid $55 billion largely due to the acquisition of countrywide and some of it due to merrill lynch. this is the last big push for brian moynihan to get past the legal issues dating back to the financial crisis tom and i think there is a big sigh of relief that a lot of this is over for them. what about personal prosecution? now we are done with the big banks, now we will go after the the former countrywide it other executives are now seems like going to be sued statute that a gives the government very broad thel ability to punish executives. it seems like they will do that. >> not with jail time, with money. >> talking about the former ceo of countrywide, andrew mizuho. >> there was an inves

economics editor michael mckee is here. mike, tell us more. we benefit from sanctions against us? >> that is what a lot of analysts are asking. when they announced the sanctions, they did not make sense -- they are putting sanctions on the european union, the united states, canada, australia, and norway, countries that are sanctioning the russians, and it is basically across the board and agriculture. the problem is russia imports about 25% of its food, so if you start prohibiting those imports, you raise your own costs. >> just the laws of supply and demand. >> yeah, exactly. for the united states, it is limited and packed because we only send them about $1 billion other cultural outings, and the biggest one we send is chicken parts, mostly legs and thighs, and that is about $310 million worth, less than 1% of our total production, so it will not hurt us. alix, you were reporting earlier this year how beef prices were up and pork prices were up, and that was boosting -- pushing chicken rice is. >> -- prices. >> there have been concerns about

yesterday, michael mckee caught up with kansas city fed chair after george. -- esther george. he asked her about the international impacts of monetary policy. >> we live in the global world, obviously, and the connections are growing between our countries as the fed thinks about monetary policy. it is focused on the u.s. and its mandate, but we talk about the geopolitical risk, we talk about what is happening in the economies of other countries because w we affect each other. >> has mario draghi called? >> mario draghi has it well in hand, i am sure. draghi, our next guest says that the ecb president could steal the spotlight at jackson hole. thank you for coming in. draghi could steal the limelight. we have heard a couple of voices telling us in the studio and again the conversation in jackson hole about whether or would be theeuro best gift that they fed could give. >> it would certainly be helpful given the inflation outlook. i like going back to 2012 when in london in the closing days of the boe's quantitative easing scheme, draghi said whatever it takes. now we are the cl

ahead of the speech, michael mckee sat down with one of the feds. president.ed we have seen significant progress in the labor market. they have been broad-based and that is a encouraging sign. just said seven times last year as a voter, wanting to raise rates sooner. would you vote the same way right now? are you on board with the consensus view? in 2013 weres around the large-scale assets, or qe3, we are now not only well into that program, we are beginning to decelerate purchases each month. there is a process to working through that. i believe the economy will be ready if it continues the progress we have seen to be ready to lift off at zero and have more normal interest rates. >> the chair had suggested you wait a while, because labor markets aren't healed enough. many who would oppose or argue that where is the inflation that we should fear? >> so it looks to be stable, but you have to look ahead. we have to beep repaired to see where the economy is going and not where it is today. in that sense we see progress being made. 6.2% unemployment. not far from

. ♪ >> michael mckee, contain yourself.eyton will make an appearance today on bloomberg television. michael mckee did not sleep last night. peyton with the denver broncos. peyton. >> what does he say, omaha? [laughter] >> peyton. gear.l gets back in today, 3:00 p.m., "street smart." i'm tom keene. adam johnson and olivia sterns with me. scarlet fu is off today. >> we are talking about activist hedge fund that has a new target in their sites, it is tony for century fox. -- 21st century fox. in firm has acquired a stake the empire. what is the firm want from fox? we will put that question to our guest for the hour. this is an interesting one. changet who has driven at sara lee and microsoft, they have bought this stake in 21st century fox after the news that they made the bid for time warner that failed. >> no wonder they came in and bought. is saying thatch 21st century fox is strategically complete without time warner. then why did he offer nearly $80 million to buy it? let's get your thoughts. is fox strategically complete

bloomberg economics editor, michael mckee. you can check out the latest economics data on bloomberg.com and read more stories about the s&p 500 rising to a record amid optimism that the federal reserve is committing to supporting a strengthening u.s. economy. from the question of when the federal reserve will raise interest rates to wall street's own pay raises -- bank of america said it is going to boost salaries by 20% next year for junior staff and their trading and investment banking divisions. goldman sachs is said to increase salaries for its junior staff. paul sore barra is the president of alliance consulting. he has joined me to discuss this issue of pay raises. why are wall street firms raising the pay of their junior employees? >> it's mostly about retention and being competitive. we side with morgan stanley last month for some mid-level bankers. raising base salaries. it's also about cash flow. more bonuses are being deferred, even some of the junior level. higher salaries allow these bankers to have a more predict

michael mckee got an invitation. he gives us an idea what investors expect to hear.onference, research papers assigned, explained and discussed. the advent of q.e. changed all of that. for several years, ben bernanke used the fed chair's keynote speech to outline fed policies to come. we don't yet know what janet yellen will do. analysts say she is likely to split the difference. say that markets still need improvement without saying what the fed could or should do about it. she may update her dashboard. high levels of long-term unemployment and part-time work. permanent conditions or transitory? another key issue is what happens when central bank policies around the world start to decouple. if the fed and bank of england start to raise rates next year while the e.c.b. and bank of japan continue with qu policies. yellen will be followed by draghi giving a luncheon here. he will talk about how bad he thinks conditions are in the 18-member eurozone and whether he thinks his will follow the fed in adopting q.e. policies and the japanese central blank discuss the latest

at jackson hall, michael mckee labors me we will see a focus. slack is the word do sure. interest rate environment that you see in europe. and equities are doing well, but .he other markets >> they will be back at the top of the hour. thank you for coming to talk to us. the president of argentina saying last night that she is still seeking a solution for all creditors in this most recent debt default. is this still possible? it is still a live issue. >> argentina has deposited the money, the payment to the bondholder, which is showing a willingness to pay. it is a peculiar issue. >> many people thought this was going to be settled and there was going to be no default. you seemed convinced that a deal would be done. what was missed? >> i was wrong. .he reason is very clear pe united states refuse to deal with the issue. that created the situation in which the government could not negotiate in the way it was prepared. this is very important. these are closing bonds that claimed that if the government pays to any group of bondholder, more than what was paid in the restructur

michael mckee is at the symposium. cited this week labor market many times. there really driving it home. get moreshe try to people back to work in a time when the economy is not going that fast? balance sheet question. the fed has done just about everything it can do. we talked with some of those protesters yesterday, and it isn't clear if they understand the role of the monetary policy. they believe that if you raise interest rates it will hurt the economy at this point, and there are arguments to that effect. but there are groups that we would be better off with rates starting to go up. at this point it is a moot point because the fed is not raising rates. the question is when do they start? the protesters are not want them to do it at all, but it is beginning to look, with the market improving day by day, that the consensus view of late 2015. we spoke to harvard university economist and he makes a will, the first quarter of the year. fed typically is very respectful of the views of the chairman. but i think the center of gravity within the open market com

michael mckee, bloomberg, jackson hole, wyoming. >> and looking at how this has been received by investors joins us now from singapore. simon, good to see you. what was your main take away? no huge surprises. it does seem that mario draghi has his hands tied to some extent when it comes to stimulus and printing money, if you will, and janet yellen, it was all about jobs. >> yes, good morning. we are quite encouraged by the overall sentiment. what we are seeing is all of the central banks, regardless of which way their policy is moving, have shown a commitment to keep their economy the way it is for as long as possible, and we think that is good for the equity markets and probably less damaging for the bond markets, so even if mario draghi is going to do that, they are going to hold off as long as they can, and we think that is a very good environment. particularly in the likes of the u.s.. is that is coming through going to be due to economic strengths rather than inflationary concerns, and, again, we think that is a positive for equity. >> when we look at what is happening with the dollar

michael mckee will be out there. a great moderation. basic chart. this is the zero bound. this is your fed staying at zero interest rates for a long time. so many ramifications of that. much longer will the line extend? does it continue into 2016? >> it is the debate that keeps us employed. eventn extraordinary since 1:00 this morning. >> ferguson, missouri had its worst night of violence. the national guard was called out. jay nixon was ordering the guard to restore peace. night, hours before the midnight curfew, police used tear gas to break up protests. i say they came under attack and gasoline bombs were used. how did we go from jack dorsey of twitter in a peaceful protest yesterday to what happened overnight where -- how many people were injured? >> eight or nine. we also have results from the autopsy. the teenager was shot at least six times, twice in the head. we know the justice department is asking for another autopsy. >> i was thunderstruck. i woke up at about 1:00 and stayed up looking at the twitter feed. tried to imagine twitter in 1963, david carr writing it

michael mckee has the headline. >> quite a good start to the trading day. pmi comes ining 1058.7, the best since 2005. this is a broad measure and includes most of the service industry. it tells us that the service industry is doing well in this country. take a look at the new orders index, 64.9 from 61.2. business at 70, 60 2.4. we have not seen numbers like this in about eight years. 62 -- activity, 62.4. capital goods, nondefense x 3.8% after falling 1.4% in the prior month. we are making some real progress here, looks like some good economic news to trade him today. thank you. now it is time for the top is the stories from around the world. get that is publishing in two. ae company will become separate entity and will have a publishing unit including 81 newspapers that will be shut -- spun up to shareholders. they had been losing ad revenue and reader since 2005. there is a new leader in the world's largest smartphone market. the company is based in beijing and was founded four years ago. the company has won market share by selling cheaper devices direc

and michael mckee is here with me as well. let's talk first about home depot.hetill waiting housing start data we will get in about two minutes time. what do you make of the home depot information? i always think if more people are going to home depot, fewer people are going to be out buying homes. maybe they are picking up their own for a sale. what does it mean for you? >> he could mean either one. we track an index we created, the remodeling index. increase ins is an the modeling and at -- restoration of the homes. part of that is people buying homes and fixing them up and part of that is people saying, i will stay in the home i have got for a while and keep on maintaining it and making it at her. -- better. >> home depot, i always like to look at it and know people out there -- i spent a lot of time myself on home depot. >> they always do well in the second quarter. springare starting their cleanup fixup garden planting, and they hire a lot of extra people in that quarter. it does not necessarily give you -- you do not seasonally adjust corporate earnings.

michael mckee is here to explain why. >> there are a lot of problems out there for homebuilders. there are number of workers, according to the homebuilders. jobs in amillion recession in construction. they gained back 800,000 of them. that is a real problem. homebuilders come to market and they need more workers to try and put holes in the ground and raise the foundations. according to the national association of home owners,, some specialties like carpenters and framers there is a real shortage. >> what are they doing instead? >> they asked that question. most of the people who were in that business when the recession started have left the business. if your job goes away for five years, you will find something to do. he went back to school and founder the work. they are not being enticed back into the construction business. one reason for that is it is not pain as well as it used to. we talk about how nobody is getting a raise because wages are going up to percent year. the last quarter, wages for construction workers only went up 1.2%. they are losing ground. it is starting to

michael mckee is on an airplane today. jackson hole -- they will argue about all of that there. >> it looks like not a lot will change out of jackson hole, but everybody is talking about the future of monetary policy. we get the weekly mortgage numbers. up down, up down, up down. the fed releases minutes from the june meeting. >> several. some. [laughter] >> words, syllables. we will try to glean what they are going to do. >> we suggest it. >> we suggest. [laughter] it will be an intellectual exercise for all of us. fed watchers. of any come out? -- have any come out? >> $5.2 billion for the second girders -- quarter. the other one that has just come out is lowe's. the second-biggest home-improvement retailer. profit beat analyst estimates. forecast isr sales up 4.5% versus the consensus of 5%. >> do they just underperform home depot every quarter? >> this is the 30th consecutive quarter that home depot sales have exceeded lowe's sales on a quarterly basis. >> for a while, lowe's was doing better than home depot. they had

michael mckee says it depends on what janet yellen decides. >> for years, jackson hole was an academic for markets, largely, it is the margins. that all changed after qe. for three years in a row, boomer nagy used the keynote address out there to lay out big policy -- ben bernanke use the keynote address out there to lay out the policy announcements. janet yellen was there but did not make any speeches. we don't know which she will take this year. >> what is most likely? >> a lot of people on wall street are expecting some policy talk. the speech title is "labor markets" and she is tied monetary policy tightly to labor market developments. i know the kansas city fed people would like to get back to the old days when the focus was on a symposium and not the speech. it is not clear what she could say that is really new. >> what would she say if she did? >> you can rollout any policy change. that is locked in. to maybe shents gives an update on her labor market dashboard and put that in the context of the papers that will be delivered there. she has focused a lot on part-time employment,