mr. carney. let's look at the pound versus dollar. and then wilfred appropriately referenced the bigger move earlier and we'll also show the five day while i'm talking. i guess what i'm confused about is -- is i guess when you learn how to paint, you just want to buy a canvas every week. the markets aren't dealing with this. the markets were functioning. central banks are too constantl. i understand that he wants the world to know he's ready to act but after everything we've been through with central banks i don't think that's ever a question in investors' minds. that's my opinion. let's go into what i wanted to talk about. let's show a couple of more charts. let's show a chart of the boon today. you see the yield? this is part of the whole thing going on with the central banks. if you look at a one week charter of the boon and then you look at a close only chart something should jump out at you. we've seen much bigger negative yields on the roller coaster ride but when it stops and you get off all those closes which are the only thin

mr. carney has to face his dual problem and he has some time.t there is another issue, the current account balance. running at a deficit. at what point, how long does he have until that starts to affect the u.k.? >> right. u.k. assets has taken a hit. give ustrying to external balance. so unless we have this very adjustmentn in the currency will help. it will improve the account balance. that is the way it works. both through trade it will help with some of that lawsuit specific and the uncertainty account andith the other parts like the income accounts. the primary income and secretary accounts. particularly the accounts where my that is our next cap of income and abroad. , whenof that income transferred into british pounds is now with more because the value of the pound has depreciated. be mechanisms to try and approve the current account. it, the i understand current account deficit is not as bad. insofar as this goes, as it is saying, let's keep people out immigration.on could that really makes the situation substantially worse in the long r

mr. carney has to say. lauren: ashley wster come alive in london.t means a lot to me in 20 years from now i will look and be happy with making that decision to come back. nicole: talk about dedication. breaking the bank with his new deal forhe internet was -- indianapolis colts. wicked weather bearing down again and the west. fox meteorologist maria molina will have the forecast for you. let's check out ctures this morning. dow futures up ready for, you are watching "fbn:am," and your first look at morning market and breaking news. ♪ nicole: overnight we are looking at european markets. the rman dax up 1%. lauren: the diagnostic point the way he formute the e.u. dow futures at 44. s&p futures up not syncing a nine-point. the next phase of it this morning because the bosch the correlation. in the world of sports, olympics around the corner. michael phelps gearing up for his fifth olympic games. the first man to qualify for five olymps after a bit during the 200-meter butterfly at the u.s. trials last night. 31-year-old clocked in three seconds after

mr. carney -- >> come on. >> we miss art carney. >> he was so good. >> very good. >> away we go, david. >> and we do. let's go with that to bob pisan the weakest part over there and the banks are the weakest part of our market. >> it's alarming the financials continuing to drop including the insurance companies. show you what europe is doing. we're down about 1% in the u.s. but europe, mostly 2%, declines across the board right now, look at the fats ftse, germany, spai. the elections in spain did favor the two largest parties there. no big gains for the left there. a little bit of good news on their part there. you see everything is down essentially 2% here. i want to point out it's very unusual to have these enormous drops in europe and not any kind of drops here. minor drops. so look at the vgk, essentially europe, the vanguard europe index, down about 13% this month. mostly in the last couple days, the s&p down 2.5%. this usually doesn't continue. eventually reversion to the mean once down the road, european stocks come up and the debate over the weekend this is a fundamental break of

mr. carney at a press briefing saying this, no information to suggest in gaza and was a preplanned attack. no information to suggest a preplanned attack. that same day, state official in abya said in ghazi was well-planned attack. he could not have a starker contrast they had met those two statements and i think it is important to remember, do not get the context. be theas supposed to crowning jewel of the clinton state department foreign policy and the obama foreign-policy. this was their example of how it works. no boots on the ground fault -- no boots on the ground. most the dictator. in fact, one of the things we discussed, an e-mail talking about leadership, stewardship, ownership from start to finish, this was something hillary clinton pushed for and got done. maybe the better one is the e-mail from sidney blumenthal. a few days after qaddafi had been removed t sent an e-mail to the secretary and said, this is a big moment. you should do a press event even if it is in the driveway of your own home. he finished with this, this is a big moment. you are vindicated. do not wait. help cl

mr. carney at a press briefing saying this, no information to suggest benghazi was a pre-planned attack. no information to suggest a pre-planned attack. that same day, state department official in libya says this, "benghazi was a well-planned attack." you couldn't have a starker contrast than those two statements. and i think it's important to remember this, don't forget the context. libya was supposed to be the crowning jewel of the clinton state department foreign policy and the obama administration foreign policy. this was their example of how it works, no boots on the ground, ousted dictator, help the arab spring. this was supposed to be how it works. in fact, jake sullivan sent an e-mail to -- one of the things we discovered in our information where he talks about leadership sturks wardship, ownership of this policy from start to finish, this was something hillary clinton pushed for and got done but maybe the better one is the e-mail from sidney blumenthal. a few days after qaddafi has been removed he sends an e-mail to the secretary and he says "this is a big moment, you should do

mr. carney: this is not a publicity stunt. this is an effort to reach out, to call out to our friends on the other side of the aisle to do what the vast majority of 90% nstituents, 80%, support the legislation that we're here advocating for. i am a very strong supporter and proponent of bipartisanship. the only way that we're going to get something done, the only way that we're going to pass legislation to address the issue that is so important to the people that we all represent is by working with our friends on the other side of the aisle. and i'm convinced there are members on that side who are willing to show the courage that they need to stand up to those organizations who don't want to see anything done and do the right thing. i have not ever been more proud to be part of this congress, to be part of the democratic caucus as we have responded to what we heard from our constituents across the country. now is the time to act. now is the time to come together as americans and do the right thing for the people that we serve.

mr. carney at a press meeting saying -- there was no example to suggest that benghazi was a preplanned attack. that same day, a state department in libya says -- benghazi was a well-planned attack. you couldn't have a starker contrast in those statements. it is important to member this. don't forget the context. libya was supposed to be the crowning jewel of the clinton state department foreign policy and administration. this was their example of how it works. no boots on the ground, out the dictator -- this was supposed to be how it works. where he talksil about leadership, stewardship and ownership of the policy from start to finish. this was something that hillary clinton pushed for and got done. maybe be better one is the ebay -- the e-mail from blumenthal. gadhafi had been removed and he sent an e-mail to the secretary saying it is a big moment. he finished of the evoke the statement. "this is a big moment, you are vindicated, don't wait. tell cleo now." committed to this. they were invested in this. this is how it was supposed to work in the state department. and they were so committed

mr. carney at press briefing no information to suggest benghazi was preplanned attack.information to suggest it was preplannedded attack. that same day the state department official in libya says this benghazi was a well-planned attack. you couldn't have a starker contrast then those two statements. i think it is important to remember there, don't forget the context. libya was supposed to be the crowning jewel of the clinton state department foreign policy and the obama administration foreign policy. this was their example how it works. no boots on the ground. ousted dictator. help the arab spring. this was supposed to be how it works. in fact jake sullivan sent an email to, one of the things we discovered in our investigation where he talks about leadership, stewardship, ownership of this policy from start to finish. this was something hillary clinton pushed for and got done. maybe the better one is the email from sidney blumenthal. a few dies africa introduce if i has been -- gadhafi has been removed. he sends an email to the secretary. this is big moment. should do a

mr. carney came on and talked about cutting rates and potential issues down the road, markets still continuedright near the highs for the day here. 12% on the new york stock exchange at new highs today. keeps expanding here. just take a look at some of the new highs we have here. some of the big cap names. exxon, chevron. many of the defense names do not have any real exposure over to europe. interest rate sensitive stocks every day. we've got a new group of interest rate sensitive stocks, including simon and kim co, tanger, verizon and at&t have been there. and, of course, a good swath of all the old utilities like southern and pg&e. consumer stocks, which really were the only sector that were hitting new highs earlier in the year continue to do it. the big issue for the second half of the year, what's the impact of brexit on earnings? my concern has been very simple. the potentially higher dollar and the lower rates for longer is going to be a drag on earnings and may, in fact, impact q3 and q4, turning them negative. tech and financials could be impacted by this. more on earnings and how i

mr. carney. >> thank you, chair yellen for coming in today. you're here for your twice a year report on humphrey-hawkins. i've gotten through some of it. i just have really a couple questions that maybe you could address. you say early on that inflation has continued to run below our 2% objective. the federal open market committee expects inflation to rise to that level over the median term. so you're meeting your target there. the pace of improvement in the labor market appears to have slowed more recently suggesting that your cautious approach remains appropriate. what other things in the economy suggest that it may be slowing down, we're pretty far out in this economic expansion. are there other things in your report that you could point to? >> so there are mixed developments in the economy. one thing we do note is that investment spending has been unusually weak in recent months. and the combination of particularly weak investment spending. of course investment spending has been very weak because of the decline in drilling and drilling and

mr. carney do if he keeps his job?pport european banks who seem to not be able to make tough decisions? forex went -- paulen i was in office, rocher never commented on any of the monetary policy that the fed did while i was there. that was extraordinarily useful operation to have a former central bankers like myself second-guessing and carping on or should notould do i don't think is very profitable. 0-2.i'm mike: we were talking earlier this morning about whether or not the decision by voters in is leap. to take th is a sign globalization may have peaked and might go into retreat. diffuseenefits are so compared to the very visible losses some people take, you have come to sort of a tipping point. >> i think we are already moving. it's just a matter of time before scotland gets another referendum. it will make it a lot easier to stay in the eurozone. i'm sorry, the eu. if in fact they don't have to take too many actions. freeing themselves from the u.k. holde article 50 takes would make it easier for them to stay. so i

mr. carney, the head of the bank of ending land, they have things -- england, they have things in control the markets may not have been expecting the referendum result, but as the chancellor set out this morning, the treasury, the bank of england and our other financial authorities have spent the last few months putting in place robust contingency plans. as the governor of the bank of england said on friday, the banks' stress tests have thrown shah u.k. institutions have enough -- shown that institutions can withstand a question their owe more severe than the country currently faces. >> reporter: in other words, a lot better than what we saw back in 2007 when you remember northern rock bringing back those nightmares? he says the banks are much better prepared for whatever happens. john kerry in brussels a short time ago saying, look, saying to the e.u., don't go off half cocked, as he put it. don't lose your heads, everything will be just fine. john kerry coming to england as we speak. meanwhile, the italian prime minister saying, look, the e.u., he says, has to be relaunched. he says the

mr. osborne, and the bank of england art carney are going to be speaking at the mansion house at 4:00 p.mnew york time, and so we deal will with that then. and now, the pricing up of the sovereign debt, and pushing down the yields and further into the negative territory of the bund as a benchmark in the course of the session, and therefore, you will see the banking sector across europe hit, and deutsche bank is falling to the the record low, and that means that deutsche bank is trading below the stress levels of during the financial crisis of 2008, and 2009. this is what i want to point out to you. look at the italian banks over the last month that were under severe pressure. you can see how some of them have lost a quarter of the value, and it is the weaker, because the banking model is undermined by the low interest rates and you are worry ared about the growth and the lower performing goals, and in italy, you are worried about the recapitalization, and whether they can find the money to do that if they need to. and let me show you what is happening to the spanish, and the italian sover

mr. staley: one is the stress tests that governor carney talked about it we have gone through all sorts oftress testing that are much more draconian. we will be fine. in terms of earnings, we may have a contraction in our investment banking results in london but you have had a 10% correction in the currency and the majority of our investment banking revenues are in new york, and the last time i checked, we are using the u.s. dollar over there still. therefore, you will have a pop in terms of the sterling value were pound value of our revenues outside of the u.k.. the same thing with the credit card business. so, let's see what is going to happen in the u.k.. on the retail side, i think there will be some pressures but i am counsel with our ability to generate a strong return for our shareholders despite what may happen with the u.k. economy. erik: those same shareholders will want to know what happens with the dividend. given the scenario you face and what we are looking at in the years ahead, is it likely it will remain where it is lower, for a longer period of time? mr. staley: what we s

this shows how unusual it is for governor carney, for janet yellen, and for mr. draghi.of the zero bound is extraordinary. francine: and when you speak to olivier blanchard, this could last for a very long time. my question is, how should janet yellen view the u.s. jobs data? is it a blip, and mistake, or is it something that is more unnerving? jim: i think she dealt with it pretty well in her speech last week, and i would expect something similar today. she did not entirely dismiss it, but she is quite skeptical of the degree of weakness that it implies. i would personally start with jobless claims as a key trendsetter. the chair mentioned that last week when she was providing counterpoints to that data point. she mentioned jobless claims and surveys of consumer opinions of the labor market. she was referring to the jobs market point of the survey. jobless claims are not signaling any weakness in the labor market. clearly it is a reason not to go today because there is uncertainty being raised i that number. we will see where we are in july and september. tom: the prima

mr. trump be sweating about the president and all of his tools? let's ask tim carney.he president is desperate to insert himself into the race. he really can't help himself, can he? >> it's interesting. president obama is amazing at the primary skills of getting people to vote for him. but he hasn't proven any success with secondary political skills getting the public to support his legislation or getting people to vote for other people he tells them to vote for. he couldn't do this in 2010 or 2014. can he pass off some of that obama ballot box magic to hoik? if he does, it will be the first time he has done it. kennedy: donald trump will campaign against the failures of his administration. he's also more popular than donald trump or hillary clinton. how does that play into it? >> he's not just more popular than both of them. if you look back over recent or medium term political history. we haven't had an exiting president who was close to this popular. george w. bush was far worse. you have to go back to ronald reagan to find a guy who's close to this popular. i think

mr. pompei and i put together in our report is on the 14th the contrast doesn't be starker. you had jay carneyng the daily press briefing talking about there is no evidence to suggest this was pre-planned that same day you have the state department official in tripoli saying it was a well-planned attack. so not preplanned versus well planned. there couldn't be sharper contrast. >> there is incompetence and there is deceit. which is it? >> misleading. >> you say misleading. you are nice to say misleading. >> they mislead the american people and it's clear and that is wrong for people in our government. and this is the united states of america. one of the hallmarks is the leaders are transparent with the citizens and they were not. >> i just want to explain why. i want to know why. >> greta, it's obvious, it's politics. remember what said did i blowm that said to hillary clinton. help clio you have the god detion of his individual looking over your line and 8 weeks before the flekdz. alive and bin laden is dead. of course they will mislead the american people and that's what they did for a susta

mr. trichet: oh yes, i'm sorry. they all have a very difficult job, obviously. get it to be launched. it is not yet launched. the fiscal problems are dramatic. i would say mark carneybrexit ahead of him and it is really one of the worst possible situations, i have to say. if the people in the u.k. say we want to leave, it would be dreadful. i would say the ecb has a lot of problems, that is obvious. and janet has also to cope with a situation which is obviously difficult because, again, the normal functioning of the economies of the u.s. and the others, if there was not accommodating policies, if the $4 trillion were not still in the balance sheet of the fed, then the counterfactual would probably be very bad. you see all central bankers in the world -- but mark has the worst difficult job in the weeks to come. tom: i like that. governor carney has some challenges ahead. jean-claude trichet, thank you so much from paris. you will see the interview out across all of bloomberg digital in a bit, as well. stephen gallo is with us. we will return. good morning. ♪ francine: this is "surveillance." we were talking with jean-claude trichet. let's get back to stephen gallo.

to him,ll be listening governor mark carney will be speaking to members of the press and you can see it all here on bloomberg. ♪ alix: mrsg . coming up, the governor of the bank of england will be speaking to the press and you can see it here on bloomberg television at 11:00. turn to techl now go, a multibillion-dollar deal was done just this morning. orns gate is buying starz $4.4 billion. paul sweeney joins us now to discuss the deal. one way to look at this is john malone, soon -- sooner or later gets his way. shown time anden time again to be very long-term, very patient. he has said that he believes that the content side of the media business is going to consolidate. we saw a lot of consolidation on the distribution side over the last several years. comcast trying to buy time warner cable. at&t bought directv. john malone has been saying on the flip side, we need to see so these media companies get together and even the playing field. david: lions gate is the producer of content, although they have struggled with movies recently. z is the distributor. why does taking these companies and putting them together mak

carney there is a great deal of financial pain that could follow a brexit. david: there is a lot of question obviously about u.k. kpolls. look at the election of mr. cameron.ookies always know. we are getting glimpses of saudi arabia's plan to transform itself. it is a country not unlike my own that is dependent on resources. the plan is to cut the public sector wages 40% within five them to 40% of gdp. they want to diversify beyond oil. david: this is a step in the overall plan for the deputy crown prince. i think it's different from canada. i don't think 45% of your employment is government employment. is not asr economy dependent on resources. a country that's going to have a hard time reducing benefits that it citizens have received from oil. subsidies are going to end. david: and they will have to borrow a lot more money in the capital markets. they're expecting as much as 200 ilion dollars they will have to billion they will have to raise. amanda: its sovereign wealth fund already invest around the world. it will be interesting to see its latest bet. up, valeant. shares of the pharma giant are plunging following quarterly results this morning. what i