now michael mckee. michael: it is a decision from the fed, the benchmark rate range unchanged at 1.5%-three .25%, and a minor tweak to the language come although it could be an important one. with the pce price index now at 2%, policymakers say "both inflation and inflation for items other than food and energy have moved close to 2%." they drop their pledge to monitor inflation developments on aly and say, "inflation 12 month basis is expected to run near the committee's symmetric 2% objective over the medium-term." the fed is telling you that the inflation is no longer a concern, and the symmetric target means you can expect inflation to run above 2%, at least for a little bit. growth downgraded to moderate from strong and the less statement remains moderate. the labor market continues to strengthen. risk to the outlook remains roughly balanced, that is a small tweak. they dropped a reference to the near term. they still expect the fed funds rate to remain below the long-term levels for some time. so th

bloomberg's international economics and policy correspondent michael mckee is here with the latest. this is a stunning reversal from the president. do we know if the chinese have offered anything in return? michael: we do not all that we know they have started the process of looking at starting to acquire a chinese tech company.

shery: michael mckee in whistler. amanda also on the ground, this book with former canadian prime minister paul martin. >> to run a deficit, when i was in the job, running huge deficits. that is a problem. in infrastructure or investing in education. youwhat you are doing is are really acting preemptively. it is the deficit my generation is creating for our children's generation. >> could it lead us back to that place? >> they are building for the future and it will work out. >> so when we look at the states , the stimulus there with that. >> that is very worried. they will inherit a massive deficit in massive rising debt. cracks the finance chief saying that you've got to get your situation under control? >> the debate will be very good and the rest of the world can basically talk. but in terms of dealing with another country, it only works if there someone on the other side listening. wax it seems people are listening less to each other these days. >> that comment is that on. >> if you were the prime minister of can

michael mckee is here with the latest.ect some progress in this week's talks, given some trade tensions easing now? don't know trade tensions will ease because we don't know what congress is going to do about the ge. was found guilty of selling primitive items of u.s. trade sanctions on china and north korea, on iran and north korea. accused also have been of industrial espionage. the u.s. congress from it came down them hard and banned u.s. companies from doing business with them for seven years, which all but put them out of business they were so dependent on your suppliers. it's a big deal for china and the president saying too many chinese jobs lost is a little on for him and it is unclear exactly what they're going to do about it. he told wilbur ross to try and find some solution, but ross has not announced anything yet. widget of wilbur ross speaking of the national press club of d.c. making some comments that seem contradictory to the new tone we are hearing is a, including that zte separate enforcement action sever

in limbo.te is michael mckee, thank you for that. michael mckee, economic correspondent.it is time for the bloomberg business flash, a look at the biggest business stories in the news right now. michael galvan new hedge fund is breaking records, $80 billion will begin trading june 1. it comes as industry growth has slowed and it has fallen. the new funds have investments from blackrock, blackstone, and goldman sachs asset management. longtime colleague. general electric has taken the biggest step in the ceos plan to get rid of unwanted units. ge has agreed to merge its century old locomotive business with a train maker. 2.9 pill -- $2.9 billion in cash. --ended its shareholders said its shareholders will own part of the company. netflix has agreed to a multiyear pact. the former president and first lady will produce films and series, possibly scripted series , documentaries and features. president obama said at their hope is to share stories that promotes greater empathy and understanding between people. that is your business flash update. china's population control polic

kicking things off is michael mckee. this chart plots where the fed sees the funds rate versus where the market sees it. something has happened of this chart that has never happened. i picked a random date. this is two years ago in march of 2016. the white is where the fed projects interest rates are going to be. the red line is where the market projects interest rates will be. let me make a change on the date. you can see for the first time ever, the market thinks we are going to have more interest rate hikes than the fed. it is a little bit unfair because the fed does not change its forecast as often. they will not change again until june but we will see if they go to four. it is a different kind of dot plot than we have ever seen. vonnie: and the more loretta mester speaks, the more that will change. i think that was a very instructive chart. gtv chart.have a nejra: what mike was saying feeds into this because it is about yield differentials. thatart was showing european equities have not been this attractive to u.s.

david: we are joined by michael mckee and rachel evans. michael, i was going to start with the delay of tariff and -- on steel and aluminum. he has just tweeted that the delegation is headed to china for the talks. very much like north korea, this should have been fixed before and not now. great potential for usa. this is given steve mnuchin a wind in his stills. michael: a little pat on the back. most at -- experts think they want get a deal on this talk. impose theposed to sanctions in may that he initially threatened. the chinese may be willing to buy more products but have said they want negotiate a specific number in the trade deficit. they have said they will not back off from the made in china plan that they would have global leadership in the future. it is not clear what the parameters are. this came across late, but you can made between now. lisa: so far a hard line has been taken from china. what do you make of the hardline and what is your optimism that there will be something accomplished? michael: they are now in a position to

and ouro michael mckee expert ad mining little earlier -- earlier.et's check in now on the first word news and get to kaylee. >> presence as the expert a little meeting on u.s. and north korean officials has gone well. kim jong own's closest adviser is going to deliver him a letter from kim jong-un tomorrow. it prime minister may be on the verge of being out of office. the socialist opposition is a no-confidence vote tomorrow. people close to negotiations are signaling that pedro sanchez is likely to get the report he needs. more signs of economic growth in supporting the federal reserve's plan for gradual rate hikes. it was up .6%, beating estimates. the fed's preferred inflation gauge held from its target, up from a year ago. in two second time years, president trump's net worth has fallen. valued ate is now $2.8 billion, down $100 million over the past year. for his golf courses and fifth avenue tower in new york fell. global news 24 hours a day on air and on tick tock on twitter, powered by more than 2700 journalists and analysts in more than 120

joining us now is michael mckee. i understand the chinese have already responded to this. they have. the commerce minister of china saying that they were surprised by this. they say that this is obviously contrary to the consensus reached by the two sides in washington not long ago. no matter what measures the u.s. takes, china has the confidence, ability, and experience to safeguard the experience of the -- safeguard the chinese people. statement you remember was we are going to buy more stuff from the u.s. we are happy to do that. we have wilbur ross going to china to negotiate some sort of list of things the chinese would buy. it has not been said that he is going to negotiate anything on intellectual property, but it might come up because you have the president saying today that in addition to the $50 billion in sanctions, by the end of june, they would impose investment restrictions on china to protect u.s. intellectual property. significantly ratcheting up in the future u.s. pressure on china. that may get back to the senate on june 12. they are not publishing this l

michael mckee is at the g7 meeting and worchester, british columbia. you are there with the people being affected. what is their reaction? ofthe reaction is one perhaps anger, but not surprised. they anticipated this might happen, particularly the europeans. enoughalks produced not to get them to suspend the imposition of the tariffs, which you mentioned go into effect at midnight tonight. tariffs on steel imports, 10% on aluminum which the president imposed months ago but suspended pending the outcome of these negotiations. as you mentioned, every member of the g7 is affected. japan was never exempted, and eu -- canada ,ecause of the nafta talks which have not proceeded far enough. those countries join the others in being sanctioned. shery: we are getting the reaction from france as well, saying the eu measures should be tied to tariffs. -- saying it will take several weeks to take measures. are we expecting the finance ministers of the eu, and leaders next weekend to talk with the trump administration? oh, yes. there will be talks. is notough steve m

now michael mckee. it is a decision from the fed, the benchmark rate range unchanged at 1.5%-three .25%, and a minor tweak to the language come although it could be an important one. with the pce price index now at 2%, policymakers say "both inflation and inflation for items other than food and energy have moved close to 2%." they drop their pledge to monitor inflation developments on aly and say, "inflation 12 month basis is expected to run near the committee's symmetric 2% objective over the medium-term." the fed is telling you that the inflation is no longer a concern,

bloomberg's international economics and policy correspondent michael mckee is here with the latest. this is a stunning reversal from the president. do we know if the chinese have offered anything in return? michael: we do not all that we know they have started the process of looking at starting to acquire a chinese tech company. that is a small gain for the united states. this is a big deal to china, 75,000 employees and they had almost ceased operations. for china, it is a big win if they get relief. the president said he has instructed wilbur ross and the commerce department to come up with some way to ease the blow. whether just wiping out the sanctions, and they violate u.s. sanctions and law with impunity. those are tough questions. david: it is important to chosen --hy zte was they were violating sanctions and they lied about it. can the president just say ignore it and let us go on? michael: the president can with trade deals. congress has seated a lot of this -- congress has ceded a lot of this to him. there is a calculus that the u.s. needs china for the north korea summit i

but there are other things in that employment report, as you would hear from michael mckee, internationals and policy correspondent. he is live at the hoover institution monetary policy conference at stanford university, and he has a key voice with him on the u.s. economy and the fed's perspective. michael. michael: thank you, vonnie, and nowre with kevin warsh, assisting with fellow in economics at hoover. i got to ask you, 3.9% unemployment, but on a year-over-year basis, wages go down. what does that tell you as a former policymaker about inflation dynamics? kevin: welcome to hoover, mike, great to have you here. the economy is strong, that is what it tells me. the economy continues to have some acceleration, have some positive momentum. 3.9% unemployment rate is strong. on the wage front, we are not capturing the underlying trends in wages. wages are moving up in the u.s. some of the reason why the data doesn't suggest it, there are huge changes in that. we see people with less than high-school educations coming into the labor force. but they have opportunities now. my guess is in a 2

david: ted aldon and bloombergs michael mckee. thank you for being here.- macy's and walmart out with results. we will get a look at the readings with oliver chen. you can turn on your radio and listen to tom keene and jonathan ferro from 7:00 to 9:00. bloomberg surveillance can be heard all across united states on sirius xm radio. live from new york, this is bloomberg. ♪ kailey: this is "bloomberg daybreak." coming up on "bloomberg markets" and asset management managing greenblatt- jeff from gotham asset management managing principal and out your bloomberg business flash. j.p. morgan chase is doubling down on china. jpmorgan is also seeking to create a securities company in china and will take a majority stake in its joint venture. ibm is invading capitol hill to lobby against the european union capital -- the european union privacy laws. they say the new eu law should not become a global standard. the measure imposes tougher rules for how data collectors gather and use personal information. there is a big medical marijuana deal in canada. aurora cannabis

david and michael mckee, think you both for being with us today.up, it was the most popular private equity deal ever. now blackstone is checking out of hilton. more on that next in the wall street beat. you can turn on your radio and listen to tom keene and jonathan ferro and pimm fox. bloomberg surveillance can be heard all across the united states on sirius xm radio. live from new york, this is bloomberg. ♪ kailey: this is "bloomberg daybreak." i'm kailey leinz in the hewlett-packard enterprise greater. coming up in the next hour, jerry storch, former husband they ceo. -- hudson bay ceo. ♪ and now to your bloomberg business flash. there is a change at the top of campbell soup. the company says the ceo is retiring today. no reason was given. morrison has been with campbell for 15 years. she will be replaced on in her basis by a board member. shares of campbell soup are lower in premarket trading. they are down more than 18% for the year. regulators and china have cleared the way for toshiba to sell its memory chip business for $18 billion. a buyer

policy is international correspondent michael mckee. questions raised in washington about why the president backed off on his sanctions. first family of the secretary of commerce giving a speech saying dte said inappropriate things and have admitted to it. are there alternative remedies to the one we had originally put forward? that is what we will explore. presidentntime, the after having bipartisan criticism came out with another teet saying cte buys a -- z is reflected of the larger trade deal and my personal relationship with president g shanking -- xi jinping. what is going on? michael: it looks like the president stepped in a minefield about making this about chinese jobs paired he is now trying to back off. wholelly he dug himself a and his headed down the path toward a trade war and the chinese called his bluff and he is now trying to back off on that. republicans.for the idea of a trade war is bad for u.s. companies. we talked about the hearing. 120 companies have asked to testify and they have had to extend the hearing to get

michael mckee is in whistler right now. where do we stand? chael: the president imposed tariffs on all steel importers into the united states back in march, including taiwan and japan. he exempted the european union, canada and mexico at the time. today he is lifting those hasptions, saying the e.u. not done enough to import quotas and canada and mexico had not done enough progress on nafta. the decision by the administration has caused swift condemnation from all the allies and retaliation. they published a list, including harley davidson motorcycles and bourbon whiskey from kentucky. canadians will impose tariffs on american-made steel and aluminum, things like maple syrup and beer cans. hurtmists say it will not the economy now, but could if we see escalation. nobody knows where we are going from here. ramy: it seems, looking at these leaders, there is reticence in this. justin trudeau said it is inconceivable there could be any kind of security issue between the united states and canada. they do not want to be doing this, do they? it seems

we welcome now michael mckee, our economic and policy correspondent.tin trudeau hosting this in canada. what is it that he wants to accomplish and what does the united states want to accomplish? david, this isy, one of those situations where the agenda kind of gets thrown out the window, the stewards of the global economy are stents of the year to talk about growing the economy and including more people in it. this time the ministers are bringing their own elements to the room. u.s. trade policy and italy, multiple reports suggesting that president trump will impose tariffs on most of the rest of the g7 as soon as today, including the eu and the host country, canada. steve mnuchin will be under a lot of pressure and treasury official said that they anticipated that and will give a vigorous defense of the president's policies, particularly arguing that the steel and aluminum tariffs are needed for national security reasons. other members of the eu say that that is absurd. be sure that they will be pressing the treasury secretary, even though he's not a

we are joined by michael mckee. literally saying he would prefer the fed hold treasuries on the balance sheet. everything you said about come using a broad range of metrics. michael: you don't want to take in a controversial stance. pretty much everybody on the fed agrees the balance sheet but that should mostly be made of treasuries. they of mortgage bonds because of the financial crisis and they all agreed they want to get out of that business. the rest of what his testimony has consisted of is basically looking at what he is said about the fed in the past. they should continue their policy normalization and push it as low as they can. the fed has a duty to remain apolitical. would expectg you from any fed nominee. one of the more in sync questions was did you feel any political pressure from donald when he interviewed you for the job. because kevin worsham, who was interviewed for the job of chair recently said he did feel political pressure, that the president might in the future ask the fed to be more accommoda

thank you to michael mckee. coming up, glencore c-shares getting hit, sources say's the u.k.rity preparing to open an investigation into the company. this is bloomberg. ♪ ♪ time for the latest bloomberg business flash. group is checking out of step and worldwide, they are planning to sell its last they can the hotel chain. blackstone will have realized about $14 billion profit and that is triple the original investment. ,hanges at top of campbell soup they say the ceo is retiring today. they have been struggling to death through a three years sales slump -- they have been struggling through a three years sales slump. that is your business flash. set to launch. is a bribery investigation into glencore, the giant under scrutiny for its dealings with israeli billionaire and the leader of the democratic republic of the congo. they have consistently denied any wrongdoing. no charges have been brought. joining us is will kennedy of bloomberg news. we are in the luminary stages and what do we know? >> no investigation has formally been launched but there is an office in london looki

we are joined by michael mckee, our international politics and finance correspondent.ive in canada. as anticipated, the countries that are affected are ready to go with retaliation. what changed in the last couple of hours? >> we are starting to get some of the retaliatory action. it was goingcing to impose sanctions on u.s. products including some steel made in the u.s.. legs,ausages, lamb apples, grapes, cranberries, and some cheeses. no specific threats of retaliation from canada in terms of what it would retaliate on. they have indicated they would. the eu and japan with a joint statement after their trade ministers met with robert white heiser, the u.s. trade representative in paris. they both call the u.s. administration's action a threat to the global economy. neither one put forward specific retaliatory tariffs. the eu had threatened u.s. bluejeans, whiskey, and ryan's homein paul district of milwaukee. we are respecting retaliation. no comment from the u.s. treasury secretary, but he is always a going to have a lot to answer for to the other ministers today. m

michael mckee is standing by with more on what today's report could mean for the fed's path. michael: thank you very much. we are here with charles plosser , former president of the philadelphia federal reserve bank joining us from the hoover conference on monetary policy, which raises the question, whither monetary policy in a world where you can get 3.9% unemployment and no wage gains? andell, the unemployment wage gains and have a lot to do with productivity. we have had miserable productivity growth over the last decade or so. it is not entirely surprising that growth in wages is not any more robust than it is. michael: we sort of strained to get the pce index to 2%, just barely at 2% after how many years, no wage growth for to you with the fed when you are at the open market committee. has something changed in inflation dynamics that would change your view of inflation? charles: well, it is a puzzle why we haven't had more inflation, but one way to answer that puzzle or to address it, is that a lot of what the fed did in terms of fighting the recession, quantitative easin

let's bring in michael mckee to break this down. a surprise move, but something needed for turkey. michael: when your currency is falling, the first move you make is to raise interest rates to bring money back and country. obviously, we are getting a knee-jerk reaction. but how long does it last and how long do people continue to put money in the country and is the lira continue to strengthen? this is a self-inflicted wound. this is not the same kind of thing we saw back in the asian financial crisis, when there was a lot of contagion. this is all about erdogan and his monetary economic policies going forward. investors do not have a lot of confidence. one of the things he said is he would play more of a role with the central bank. he has adopted this view, sort of a fringe economic view that, if you lower interest rates, it will lower inflation. nobody really believes that. instances where frontier markets with very strange economies saw something like that happen, but no instance of any developed economy doing that. if he's planni

lisa: are thank you to michael mckee, bloomberg economics and policy correspondent. is bloomberg. ♪ bloomberg. ♪ scarlet: this is "bloomberg markets." i'm scarlet fu. it's time for the bloomberg business flash. a look at the business stores in the news. tampa 2 is go fed president john williams reiterating his view rate hikes are appropriate for 2018. he says he is positive about the economic outlook in the u.s. and abroad. investors expect the fed to raise interest rates on june 12 and 13th. on june 18, he will become the head of the new york fed. coinbase is developing a new tool to attract institutional investors. some of the tools include custodial services that will allow investors to store large amounts of digital currencies and more trading abilities such as risk management and margin trading. coinbase became the best-known currency exchange in the u.s. by bringing but going to the masses. cap has apologized to china for a teacher that offended the country's political sensibilities. the t peart -- t-shirt featured leaving-- map of china out parts of it. that i

mckee has the story. --hel: michaelthe fed is deciding whether to hand about future modes. -- moves. rate increases continue to run below their 2% target. the index level was reached in march. policymakers say they have met their mandates. two mores at least rate increases by the end of 2018. the question is whether there will be a third, with unemployment so low and commodity prices rising. tuesday's drop in the ism manufacturing index is blamed on a -- an economy to strong -- that is too strong. higher commodity prices are generally viewed as transitory. if they don't move now because there is no press conference at this meeting, june is the next logical time. that means any hint about the future may be looked as more of a fourth rate move this year. expectations have been rising, which has pulled up the market odds of that happening. the market reaction to the igh,es high, -- fed is h even with no move this month. >> michael mckee, there. we have a reporter in london on set. toid, perfect on fed day talk through some

stanford and our international policy correspondent michael me is at the hoover institutional -- michael mckee the hoover institution's with one of the organizers of the event. >> we are with john taylor of the taylor rule. a lot of fame in the economics profession and he helped put together this conference. one thing everybody is talking about, the labor report, 3.9% unemployment and yet on a year-over-year basis, wages go down. how is that supposed to happen? >> the literature is not perfect on month to month changes. you see some improvements in wages. not necessarily tied to the unemployment rate but productivity. >> it is outside the purview of monetary policy, correct? >> the real wages are outside the purview, how much wages increased to prices -- price inflation is monetary policies role. >> and 2009, you thought the stimulus package would lead to very high accelerating inflation which did not happen. we have a stimulates package now but no inflation accelerate. does this suggest you were wrong in your diagnosis or something has changed in inflation dynamic? >> my main concern about th

michael mckee, bloomberg, stanford, california. anna: that is what you need to look out for.oining us here on set is lillian. great to have you with us. numbers, wethe jobs are watching for that later today. what will be the focus for you? we might get clues about how trade tensions are shaking parts of the u.s. economy. >> we have rd seen that trade tension feeding into the market sentiment but also business surveys. we saw and the pmi yesterday and the michigan surveys that it is starting to impact the real economy. we will have to pay a close watch to that. we will focus on wage inflation. that will still be the focus. i would expect inflation to continue to pick up. we are in the slide growth slow down. that has been the commentary. willtion is lagging and we continue to see an uptick in those numbers. what is causing you a concern in the u.s. economy? we have a great charge. the national association of credit managers and their combined sex hurt dollar selection. creditors are having a hard time collecting money they are owed. this index has dropped to the lowest since 2

bank wealth management and with us here in new york is a michael mckee.here going back to 1994. and we haven't been close to this high since 1994. what does that tell investors about europe or wrist assets generally? lisa: you see a dormant risk now coming back into the for and it is affecting investor sentiment. riskwe see really is the off move because people are uncertain. is this the beginning of the populist skating more control? is,d: the way the reporting we will probably know the answer not for several months, it appears? key: there are three impacts of the development in italy. a lot of question of geopolitical development. with this kind of uncertainty, investors hate uncertain team. continue to see more movement in the markets up and down. and a second key impacts is that as this continues to develop, potentially more impact on bond deals as you noted. that we gaintent momentum moving towards wider momentum is going to rachel the fixed income markets. and correspondingly, the equity markets. they are based on relative valuations. and the third

we welcome michael mckee. trump? ident we will put up a chart who shows who exports automobiles to china. michael: the headline optics are first come the chinese have liberalized the number of rules in the auto industry a couple of months ago, ticking off the 50% ownership cap. they will not be able to do joint ventures, auto companies, starting in 2020. that was perhaps a bigger move for the chinese than this because u.s. automakers all have auto plants in china. u.s.: that is why we saw automakers because for example, general motors makes the cars there. michael: they all have joint ventures. even though they will not need them, they intend to keep him. i have another chart that shows the opportunity, i suppose. you can see the growth rates of total imports in china and north made have been growing faster but i put red lines in there to show you these two things are flat. the market has been more open and automakers are making cars there, but people are not buying them to the extent that they have another countries,

joining us now is michael mckee and sebastian page. good to see you. this is the u.s.rade deficit. many b's can you buy off of that -- beans and you buy off of the? >> they by about $13 billion a year worth of soybeans. everything else, there is increased scope for aquaculture sales. the question is how many would be new sales as opposed to moving from other countries that you are exporting to from china? it is not clear how much extra they can pick up. liquefied natural gas, there is a capacity constraint. china is buying a lot of our liquefied natural gas. i brought a chart that shows both the opportunity and the difficulty that we have. it shows that you are looking at -- the blue line is what china is buying overall. the white line below is what we are selling them. there is a major opportunity to sell more. we have only one operating terminal,natural gas five more coming. we estimate that we could triple the amount of natural gas sales to china over the next year. of course, thatwe estimate thatt a billion dollars worth of additional sales. so you have a long way

let's head to michael mckee, where he caught up with dallas fed president robert kaplan.about the threat facing the economy. >> the financial sector is part of that as key leverage. what i am looking for is systemic risk. if the company fails or defaults, it is not a good thing, but it is not going to pull down or shouldn't pull down the rest of the economy. corporate jet to gdp is something to watch, but i do not think a red flag is there at this point. michael: another thing you did not mention is oil. what do you see happening with oil prices and how much of a danger is it to the economy? robert: it is not a danger. we are in a fragile equilibrium right now. what do i mean by that? we are in relative supply-demand allen's globally. but some of that is based on opec and other oil producing countries agreeing they are going to cut 1.8 million barrels a day, and there is some talk they might revisit that. for the next 3-5 years, what you -- what youolatile will see is a volatile up and down in global prices. my concern is not in the next few years, but the out years. we t

michael mckee will interview robert kaplan.ay is a big day for another reason, that is because the general data protection regulation, gdpr, goes into effect in europe, placing new limits on companies that collect and use data on individuals. to take us through the regulation, we welcome bart mcdonough, and sarah, who is our bloomberg intelligence senior analyst in london. we will put up a chart that indicates that outlines in the gdpr, take us to the important new restrictions. is wouldally, th apply to companies in you are in the world, if they process data in the european union. its impact is not insignificant. andrules on data processing storage come into effect today, and it is a huge challenge for companies, especially in the financial services sector, which may have been focusing on. we're talking about the average cost of 66 million pounds, compared to 15 million for 5100 companies. david: you are for the financial services. we tend to think of this in terms of google or facebook, but the fact is financial services comp

michael mckee is here with the latest. ss -- commerce ministry came out with the statement could what did they say? michael: they are disappointed and surprised here they thought they had an agreement with the administration that wilbur ross would come to beijing and put a list together that china could buy two lower trade deficit. in the statement, they said no the united measures states takes, china has the confidence, ability, and experience to safeguard the interest of the chinese people and the core interest of the company. chart.ring up a we have until june 15 and if we want to lower the trade deficit, take a look at this rate this is what you would need to do. by 547 boeing 747's. hefty increase. increase soybean sales by 13 times. not sure we have that much left in the country or they could buy 2.5 billion dollars of our shale oil. none of that is likely to happen. it will be interesting to be -- ae what happens when we get list. you have to say that june 15 is three days after the north korea summit that the presid

michael mckee just chimed in that the overwhelming twitter vote was for quitaly.ty, how much of this is going to remain the focus by the end of the week? we have a lot of data coming up including gdp and the jobs report on friday. jeff: it is a good point that markets can point to one thing at one time, and today is obviously italy, but that is not going away. we are repricing political risk. there will be a semipermanent fixture. this will not be retraced immediately. today is clearly classic risk off. other things are going on. it will be interested to see how the u.s. trades during the day because the fundamentals have been very distinct, and the italian issues are distinct as well. there is clearly a crossover terms of risk off, but we are talking gdp, payrolls, inflation, the fed. the flight to quality seems to price back a little bit of the central bank expectations. scarlet: speaking of central bank expectations, ecb officials are due to speak today. will they address what is happening in italy? it would be hard for mario draghi to avoid making that connect

coming up on "bloomberg surveillance," michael mckee speaks to the dallas fed president. talk treasuries and dollar. this is bloomberg. ♪ this is bloomberg. ♪ francine: this is "bloomberg surveillance." joining us now, bloomberg's opinion for technology analyst, let's talk about amazon. >> if your name is alex, you encounter this regularly. miss recognizes your name and lights up. what happens here is the extension of that. it heard a command, thought it heard something else, and thought it heard a confirmation that this should be sent to someone. this displays the limitation of this technology. smart noto have very just understanding of the words themselves but the intention of the words. that is the bridge everyone is trying to cross now. there is a long way to go. guy: machine learning and all this stuff government we think we are further ahead than we really are. >> you know this if you have siri. learning about machine and what it is good at is understanding one thing. what is the weather like today? it is bad at understanding two things, what should i wear today? th

michael mckee is expert at this. i go to eci, which throws in the benefits.e forward with the conversation on china, on bloomberg surveillance on radio today as well. i,elieve, jon ferro and reunited? ♪ reunited. foreign-exchange, yen, flat. this is bloomberg. ♪ ♪ >> i think that is ridiculous. i don't think we are facing a threat at all. alix: that is ridiculous. james gorman says george soros warning of an eu breakup was unrealistic. he sees higher yields and four that hikes this year. mariano rajoy on the brink of being ousted by socialists while the italian president giving populist leaders one more chance to form government. hello inflation. upside with latest readings on u.s. prices on deck. david: welcome to "bloomberg markets," i'm david westin with alix steel. things have been better? alix: italy seems like a thing of the past. david: james gorman. alix: spanish politics is fascinating. it seems like no one is interesting. two-year yields in spain are negative versus italy now positive. huge move this week. fascinating. socialist

michael mckee and i have a mutual agreement that usually the secretary says nothing.ot going to get it from secretary mnuchin. what is the backstory on this trip? the backstory is that the president has backed himself into a corner. he says we are going to put on sanctions. the chinese have threatened to retaliate. you have to find some way out of it unless you really want a trade war. that is always a possibility with this administration. the chinese have suggested they are willing to negotiate, but only so far. what will satisfy the administration? the chinese, our reporting has shown, have suggested they would be willing to increase their purchases of a number of american products like airliners, but they will not abandon their plans to be strategic leaders in the industry's of tomorrow. navarromr. ross or mr. on this junket? michael: mr. ross is, mr. navarro has been sidelined. scene from star of who is on this trip. tom: this perfectly describes this except the chinese don't play bar scenes from star wars. michael: they certainly don't all agree on what trade pol