did you hear stan fischer? what do you make of what's happening here, intraday?> you know what i kind of agree with what everyone said, which is you know, there's a lot of don't tary and a lot of data to process and i think markets are really confused. i would say i think the challenge is you know, we don't want investors to try to react to every data point, so, when we think about what it means for the next 12 moment, i think it's still on balance, on message, i think what it is telling us is the u.s. economy is doing well enough for the fed to essentially normalize rates, which, you know, which -- it would -- i think really help equity market, feds, once we get the process under way. >> let's talk about what we originally had you on for, which is embrace the volatility. you are positive about earnings and you are positive about the stock market, right? regardless of all that we have seen in the last week? >> well, i mean, it's been a tough week. i mean, really, a tough month. but i think one of the things we want to address is the market's made a pretty nice mo

certainly, quite a reaction from fed vice chairman stan fischer.e will get a reaction from the former president of the dallas fed, richard fisher, in just a moment. >>> stan fischer obviously moving the markets. traders will break down what they think of what he said as this wild week comes to an end and they will also give you their game plan for next week. plus, stop worrying. we will tell you three reasons why you should embrace higher interest rates. and the halftime portfolio challenge heats up. the top two traders both making moves today as the battle for the top spot continues. that and more ahead on "the halftime report." >> the markets after federal reserve vice chairman stanley fischer giving his thoughts on a potential rate hike. >> i think it's early to tell. the change of the circumstances which began with the chinese devaluation is relatively new and we're still watching how it unfolds so i wouldn't want to go ahead and decide right now what the change -- what the case is more compelling, less compelling, et cetera. >> joining us now

stan fischer speaking exclusively with steve leisman. some interpret him to be a little more hawkish. i didn't hear it but the markets seemed to react that way. down just a little bit. very narrow trading range, 13, 14-point bottom to the top. volume is heavy but declining. heavy for august but not heavy for earlier in the week. 3-2 advancing to declining stocks. volatility, basically flat in volatility, but vix still in the mid 20s. widely held names with be fairly flat. reflecting what the overall market is doing. pfizer underperforming just a little bit here. we all have lists of stocks that are heavily shorted. they're mostly in materials and the energy space but some really moving a lot here, chesapeake, oasis, continental resource in the energy group, materials, steel stocks also doing very well. one group having a tough time is interest rate sensitive stocks. lot of talk about the chinese selling treasuries because they need cash to prop up their own currency. i think this has put pressure on some interest-rate sensitive groups. t

let's look at what stan fischer was talking about. pce.is core this is one of the 27 flavors of measuring inflation, and here is what stan fischer is pushing against. inflation down, and it is going to rise. s says influencing inflation is a recipe for disaster. a smart quote from dr. orphanides. the silence you heard was the economic world coming to a dead stop as stanley fischer make comments on inflation. "i believe he said little, which is exactly what janet yellen wanted as she keeps her options open." michael mckee moves the fed story into a new month. joining us this morning, harold york. skip york will give us wisdom on your marginal gallon of gas throughout the hour. let me get to the fed first with michael mckee. i wanted of the backstory that was not reported. what was going on that was hidden in the stories? mike: the big raging battle between the kansas city royals and the st. louis cardinals was one topic of discussion, but other than that, is the fed going to do anything on september 17? that was the entire conference.

erik: i know you talked to stan fischer about comparing what is going on in the american economy within the u.k. here's what he had to say. stanley fischer: we are not alone. the behavior of the british economy is similar to ours in terms of inflation and unemployment. there are fewer and fewer growing decently. erik: fewer and fewer growing decently, which is to suggest in the developed world, america is leading the way. britain perhaps is following. i guess beyond germany, very much? tom: germany not doing bad. to bring those to get together is the price of oil and renewed negative interest rates we saw in europe. the back story last week and as we begin monday is lower interest rates in germany and a negative interest rate for the swiss 10 year yield. that is a different get -- difficult know you -- that is a difficult environment for them to act in. the world speaks to janet yellen through the markets. stephanie: it is easier to opine on the sidelines. you had a chance to sit down with alan greenspan earlier today. what did you learn from him? tom: he is concerned about productivi

guy: talking yesterday to stand fisher -- stan fischer. feeds into aems -- form see.omething we have to talk about. guy: i'm sure you will be talking about greece as well. a few more headlines. the deal is done. greece kayla bankgreece's creditor -- caroline: greece's creditor's agreement new deadline. guy: on the move is next. we will see you tomorrow. ♪ jonathan: good morning the welcome to "on the move." "on the mov i am jonathan ferro. yuan devaluation. the people's bank of china slashes the currency. the biggest one-day loss in two decades. google becomes alphabet. a conglomerate as it searches for new future. the stoxx soar. deal. talks between greece of the creditors go into the early morning hours. they agree with terms on a third bailout. i will break down those stories. 20 seconds ahead of the open. by 30tures of -- off points. is china.eme caroline hyde. caroline: phenomenal moves area that record move in the yuan. a devaluation to the tune of 1.9%, the most in 2 decades. it moves across asset classes and everybody knowing china is trying to boost exports.

think about raising rates, or do we have to fire our own salvo in the global currency echo david: stan fischer said yesterday on tom keene's show, we are getting closer to full employment, but he is concerned about inflation. he is leaving the door open, saying that if china devalues, this brings in deflationary forces around the world and the u.s. will not do with this implication, and therefore that is something we need to take into account. there is no question in my mind that the chinese move today will cut short the fed tightening. i think you want -- erik: we see that with treasuries yielding back. david: the market is very efficient. erik: i want to go back to the point you were making about the impossible trinity. most people are evaluating the chinese evaluation as a short-term effort to boost exports. -- you talking about it are freezing it as a structural capitulation. qe,d: when the u.s. did what happened yet go the rate went down, the dollar collapsed, and the stock market went down. when the ecb did it, the european stock market soared. in to say the japanese qe 2013. china is no

stan fischer is my old teacher and i am a big fan of his.ink that they have been itching to raise the rates. they have wanted to raise the rates for a long time. i don't think it's warranted. i don't think that the economy is growing that fast. china is slowing down. europe is a disaster. >> the problem is that the fed does not have a gdp mandate. : in a way, that is the problem. but gdp and inflation are tied together. they have a dual mandate of employment and inflation. employment is strong, inflation is weak. you have a divided mandate. king of there the fed, if you ran the whole thing, what specifically which -- would you look at? what would be the determining factors? austan: the fed is neither a kingdom nora cleaned him -- .ueendom what they ought to be looking at is before you start raising rates, how would we achieve some form of sustainable lift off in which you feel that the economic growth is not just a blip doing pretty good. well by oneng measure. the jobs are good, therefore we should raise rates? you want to be consistently s

stocks fall in europe and asia after vice chairman stan fischer says a rebound in inflation will allow the central banks to raise rates gradually. >> we've got a little over two weeks before we make the decision. and we've got time to wait and see the incoming data, to see what exactly -- what is going on now in the economy. >>> the shanghai composite ends a month over 12% lower. in favor of a more punitive approach. >>> hitting the motherlode. shares in eni rally as they discover the mediterranean's biggest gas bill. >>> a sea of yellow, thousands of protesters take to the streets in india. but the country's prime minister said he will not resign after a $700 million donation scandal. >>> and you are indeed watching "worldwide exchange" on this monday morning. and the event of the global markets always open. we're looking at the ftse mib right now lower. last day of august, 0.8%. it's been the uncertainty around fed policy as well as weakness in asia that has been sending stocks lower. we came back a bit but here on monday, starting the week on a down note with french, spanish and por

stephen: that is the point, brendan, and stan fischer is a wonderful man, a first-rate academic withexperience, but again this sensation on inflation targeting i think is a recipe for disaster in an overvalued market. mike: it is not so much inflation targeting is they have set their goal and they are measuring their progress against that goal. until they see the inflation rate moving up for 2%, they say they are worried. stephen: you are right, they set their goal. is that the right goal? mike: a lot of people would say it is the right goal in the sense that if we raise rates, you will start to see inflation move up because you will get a dynamic reaction in the markets, and you will squeeze out some of the problem -- tom: we have got to go to break. we come back with china and labor arbitrage. is this that going to be overcome? stephen: it usually is. tends to be reactive, not proactive. that is why they are holding their powder dry right now and will continue to do so as long as they possibly can. they are looking for excuses to delay a rate hike. of: stephen roach with us yale un

for more, carl riccadonna is here. , basedsensus seems to be on the remarks of stan fischer and others that the fed is looking beyond the term what it feels september 17 more or less the same way it did a couple weeks ago. carl: what they say they feel and what they actually feel could be slightly different things. i think they are very attuned to what is happening in the financial markets in the potential negative feedback loops and the confidence affects from the equity markets just generally unsteady. they are worried about that feedback into the economy. they are saying to look at the big picture here with the u.s. economy doing well, gdp looks good, employment landscape is fairly solid. as long as that holds up, we should be fine. we should be able to move away from a crisis era of monetary policy. however, they are certainly very finely tuned to that feedback mechanism from the financial markets. ont: the meeting is september 17. what data does the fed need ?the the market matters because families who have money based onin the market those returns. consumer confidence is affected

stan fischer is the vice-chairman of the fed. he brings to us not only the domestic conversation, but decades of experience in eight -- in international economics. let's get to our top headlines with vonnie quinn. vonnie: coming back to you later in the morning from washington, d.c., with those interviews. violence erupted at the demonstration marking the one-year anniversary of the death of michael brown. the unarmed black man who was killed by a police officer. [gunshots] >> get down. gunfire. police say a man began shooting at officers and was wounded when police returned fire. the suspect is in critical condition. donald trump is refusing to apologize for comments he made about fox news anchor megyn kelly. he is under fire for how he described her performance last thursday during the debate. he has denied he has done anything wrong and says he has no problem with women. donald trump: women are tremendous. i have had such a amazing relationship with women and in business. they are amazing executives. they are killers. if you s

but gary, what we are talking here about is what stan fischer and bill deadly and mark carney do not talk about. which is gary shilling is right. when do you assume that central theers will adapt to oversupply, the supply side dynamics out there across all asset classes? gary: that is a very good question, tom, because if you look at their forecast from the fed. 2012, they said 4% real gdp. they printed down to 2%. for 2013, 2014, 2015. at some point you would think they would say, let's try something else. this is not working. of course, again, they have a credibility issue right now. theycentral bankers if limited look at the facts, they really would say this age of deleveraging as i call it in my 2010 book -- that you say is a shameless plug -- that is still with us. dp growth. i think that is continuing for a number of years. tom: i want hans nichols to jump in with a question on your. hans: so much of the oil talk has good -- will consumers feel richer? at what point you start seeing the oil price affect consumers? one good data point out of german gdp. german considers -- consu

what stan fischer said to you yesterday is important. the u.s.ess sensitive to the rest of the world and the rest of the role is to the u.s. economy, so it has to be a bigger move for them. certainly this will be on their radar. off a bit off the opec news. it is like october this morning. brendan: there is a greece deal, and it is our third story. [laughter] tom: how about our twitter question? let's get to it right now. will china's devaluation help its economy? good morning. ♪ tom: good morning, everyone. "bloomberg surveillance." tom keene, brendan greeley, julie hyman in for vonnie quinn. my conversation with vice chairman stanley fischer here on inflation. the problem is not with the part that is unusual with the mandate, namely unemployment -- that is doing just fine -- it is with the inflation part. if we were just inflation target ers, we would be any same situation we are in now, we would have to do even more probably if that were possible. tom: addressing the challenges that the fed in the bank of england have as well. jeffrey rosenber

my take on what vice chair stan fischer said is to put september back on the table. to say that it's a done deal but suggest if you thought this was not going to happen, you probably should pay more attention to the economic data, saying the federal reserve had not yet made a decision. >> we are heading in that direction, what's happening in particular with the labor markets. we'll have to see if that continues when we get the data for next week. has been impressive and the economy is returning to normal. we are not certain we're there yet. >> he didn't ignore the recent market volatility but said it could calm down in just a little bit. there are two weeks of data to come. he also revealed a little bit of information about once they hike what the next step is. listen closely to the end of this sound byte here. >> we are beginning a process that we anticipate when we do it will be relatively slow, and the first move presumably will be from zero to 25 basis points to 25 to 50. >> i get they didn't have the full sound byte there. way said at the very end of it, once th

the interview of the morning, the fed's number two, stan fischer, will sit down with steve liesman andhe interview that you cannot afford to miss. plus investors are catching their breath after a wild ride in the markets this week. we will tell you where you can find value right now. and forget monthly active users. facebook said one billion people logged in to that platform just yesterday. we will get thoughts on where growth is for facebook next. and a special cohost. you don't want to miss it. that's next on "squawk alley." [ male announcer ] eligible for medicare? that's a good thing, but it doesn't cover everything. only about 80% of your part b medical expenses. the rest is up to you. so consider an aarp medicare supplement insurance plan, insured by unitedhealthcare insurance company. like all standardized medicare supplement insurance plans, they could save you in out-of-pocket medical costs. call today to request a free decision guide. with these types of plans, you'll be able to visit any doctor or hospital that accepts medicare patients. plus, there are no networks, and virt

not going to be at the conference which is set to focus on inflation and monetary policy, but stan fischer will speak on inflation. the key will be those talks during those walks in the woods, and whether markets get any sense which way fed officials are leaning on rate hikes for september or december. or even not at all in 2015. i'll be listening for whether emerging market central bankers argue to the u.s. fed their situation is so precarious the fed should stand pat. we'll be live from jackson hole starting wednesday for three full days of coverage. >> steve, you mentioned earlier on air some comments from bullard. you've got to mention jeff gundlach is scratching his head saying what in the world. >> a lot of people are scratching their head. we did our survey yesterday. we surveyed over 17 economists. 11 or 12 of them are onboard with the september rate hike. i don't know if that was 400 points ago or 800 points ago in the dow. i have to think the fed is saying we have to reset our communications that if some of this is because of that fear of quarter point in september, they have a c

this is a point stan fischer keeps repeating and is correct. with all due respect to larry and his prodigious brain, i disagree with him on that. >> without espousing this view, there seems a sense maybe the fed missed its optimum window. we waited this long and we got 2% gdp and financial markets have come a long way, and now they are having trouble. is there reason to worry that even when the fed does eventually move, it might not be the optimal time to have done it? >> i was advocating to do this back in march. but again, it depends on what happens with the real economy here. the real economy is actually on balance, quite good. your 2% number is too low. to be sure inflation is measured by pce is a low number, way below the 2%. the triple mean calculated by the dallas fed and cleveland fed, they are running about 1.6% on a consistent basis. employment numbers are good. housing numbers in terms of homes sold are good. the auto numbers are good. there's a lot of good that's going on in the economy. so that's really what the fed focuses on. not

fischer. the head ofin global fx strategy at bnp paribas. >> said watching is hard enough. if those going to make it easier i would say watch janet yellen, stan and -- stanley fischer and william dudley. did william close the door on september? >> i think that seems to be the case. the greek crisis is the catalyst so from our perspective we think that even before the malaysian equity market was off the table we think the fed is data watching. unemployment is doing exactly what they wanted to do with falling and looking positive but what they need is more confidence on growth so from that perspective they are data watching like you and i. >> traditionally the fed places less emphasis on markets than we would. having said that, there is no way they're going to start lift off. legend giantfund making some weight talking about qe4 the last couple of days. >> ido you think about it? think it is highly unlikely with the on a planet rate already through the roof. it is really not on the cards. think a more likely course would be to delay the liftoff. with unemployment where we are, sub 5.5% -- highly unlikely. jon: in china to stabilize the currency

think, what fischer wants it to be and that gives the fed i think ultimately was the point of what stan fischertaying, the optionality or the flexibility of where they want to go. you think of being in their shoes, you don't want to go into that meeting with the market way offside so if you do decide you want to hike you don't want market turmoil. it simply brings it back to where it was to give the leaders options. >> let's talk to these gentlemen in details. the government's pill report is out on friday that can happen from now and then. here to talk about what's happened in the last two weeks. simien, and peter a chief analyst. peter, your contention for a while would be there would be a piper to pay for all of this accommodation. i think it's interesting that you think a lot of the wealth effect engendered by the fed was artificial, and not justified by the underlying economy. so, now, we start heading the other way, and we see what a stock market collection is like. and 20%. and then you get a reverse effect. you could see that actually causing a slowdown in consumer spending. and then the