he was one of the united states's most faithful servants as a legislator, as a secretary of the treasury under jefferson and madison, helped fund lewis and clark, was not very keen on the war of 1812, then became a piece negotiator -- peace negotiator, and ambassador, and on. you will hear him talk about that. and i want you to invite you for discussion after the talk, feel free to ask him questions about anything that relates to may be something that he was not directly involved in, before his death, he might have comments on current events. for now, i want to introduce albert gallatin. [applause] mr. gallatin: thank you very much. my friends and fellow citizens, it is thanks to the historical society and mr. william digiacomantonio, that i am here today. they have dragged me from wherever it was that i was. to me it is most remarkable that 27 years after the founding of our public debt republic -- republic, they have a society dedicated to the history of this building and those that work with your that is -- within it. that is a remarkable matter in any country's history. as some of yo

we ask them about the treasury at first to preempt the decision and what the treasury department can now. as you indicated, we have laid out our concerns about this decision quite clearly. as a novel application of the state aid theory and some over wide existing tax interpretations in the rules of the national tax authorities. , at least to some extent, it is reaching into the u.s. tax base. for these reasons, we have clearly articulated our concerns. i think the way ford with this is we will continue to make clear the concerns that we have. i think it is also important to we have beent --aged in a construction of constructive effort which we see as a promising way ford in the g-20. over the last year, a fair amount of work has been done over how do we optimally tax and appropriately tax multinational firms. steps to makeke sure they are paying their fair share. there are those who say in light of that that multilateralism is a good thing, but if one of those parties is not doing anything, why wouldn't the european commission go out and do this on their own? there has to be some frus

the actual yield. visually -- treasury analysts have underestimated the demand for u.s. treasuries. the first time that the yield has gone above the forecast for the treasury yields, so we have seen the yield go down and now it has bounced, but the question is, and all of these treasury forecasters cut their forecast by too much? we have seen a 25 basis point bounce in that yield since the record low back on july 6. we have seen this appetite for u.s. treasuries as we have seen negative yielding, sovereign bonds around the globe and u.s. treasuries have looked to track by comparison, we have seen investors push out their expectations for when the fed might raise rates. that has also meant yields are low. at the same time now, we could be seeing a reversal. we had some beneficial saying maybe the treasury market is underestimating the odd for a federal reserve rate increase. whether this now is a more permanent change, but this is notable since the first time it happened this year. nejra: where can we see your jarden -- your chart? i was looking at the difference between some differen

they make a lot of money on these transactions and now the treasury department is in title companies have to find out this information. look they asked. they asked the brokers so the brokers have to do more work, they have to tell the title companies and that can make buyersuncomfortable and it will lose some of the business for them . jenna: how does it feel, you get a series and now it's affected real change in the country and you found some shady characters the program that also a couple weeks ago, the department of justice came out with a $1 billion case involving that family of the prime minister of malaysia and those were people call the tower of secrecy project, people can read it@nytimes.com and sometimes at work you see change and it does feel like okay, we're actually doing something right. jenna: something good hopefully and especially with this malaysia case, it's something for our viewers to look at. you realize this family, where they were putting their money and why there is such outrage about it. congratulations with the big report, john? jon: what a story. new fears t

we think the five-year treasury is sitting around 1.2%. we think there is plenty of room for the yields to fall as we move forward into the end of the year. david: that was earlier today on bloomberg. vonnie: more breaking news out of brazil, dilma rousseff lawyer they will appeal her and peach meant, and that will be entered as soon as today. the impeached president from brazil. that was the impeachment vote earlier today. this is bloomberg. ♪ \ >> this is bloomberg "markets." i am david gura and washington today. -- in washington today. vonnie: the u.s. government has filed an antitrust lawsuit between monsanto and deer. the u.s. says that when a limited competition and raise .osts twitter jumping in wednesday's trading. after the cofounder told bloomberg television that twitter must weigh all of its options amid ongoing speculation the company could be a takeover target. >> mike davis high. -- my faith is high. >> we have seen a lot of m&a. do you see twitter remaining an independent company? we are in a strong position right now, i thin

the treasury has examined this many different ways. ey say we've always managed this and lengthened out the maturity of the treasury debt. we don't think it's time to issue long treasury debt. they don't want to do that and have them trade down. >> if people are pessimistic about the u.s. long-term future. >> it's more if inflation goes up and they basically get into the treadmill. i do think that it makes some sense on the personal household budget level. but the government -- the treasury thinks it has a better way. >> we're approaching the top of the hour. the team is getting ready for "squawk box" in new york city. becky quick joins us with a look at what's coming up. welcome, becky. good to see you. >> good to see you and mike. >> we're talking about a lot of same things you've been talking about with the markets and the politics you were touching on. in fact, coming up in a few minutes, we'll talk with ben white who will tell us about how he sees everything that's played out since the democratic national convention and trump's com

we, the treasury is planningll to change that. by the year 2020, they intend to put a woman on the $10 bill. what do you think of that idea? >> i think that's a great idea. i think it's time that we have a woman on a, liany bill.ke, >> as long as it doesn't, you know, increase the price [laughing] the currency -- you know, if the currency is still valued the same, it's. fine >> i think there definitely should be a woman on the $10 bill because there isn't a lot of female representation in the government, so yeah. >> i don't think it's necessary. it's part of our history and doesn't really need to be changed. >> i think they should because, you know, there's just been men on it for the whole time, and as, you know, our society evolves, so should our currency. on our currency. here are some of the names being considered. sacagawea, the shoshone woman who helped guide the lewis and clark expedition. susan b. anthony and alice stokes paul. they were suffragettes who campaigned for women to have the right to vote. harriet tubman also fo

well, the treasury is planning to change that. by the year 2020, they intend to put a woman on the $10 bill. what do you think of that idea? >> i think that's a great idea. i think it's time that we have a woman on a, like, any bill. >> as long as it doesn't, you know, increase the price of [laughing] the currency -- you know, if the currency is still valued the same, it's fine. >> i think there definitely should be a woman on the $10 bill because there isn't a lot of female representation in the government, so yeah. >> i don't think it's necessary. it's part of our history and doesn't really need to be changed. >> i think they should because, you know, there's just been men on it for the whole time, and as, you know, our society evolves, so should our currency. >> just about everyone agrees here are some of the names being considered. sacagawea, the shoshone woman who helped guide the lewis and clark expedition. susan b. anthony and alice stokes paul. they were suffragettes who campaigned for women to have the right to vote. harri

alix: we are seeing a lot of action in the treasury markets. the yield moves lower by about two basis points. yields are moving lower by two basis points, and we are seeing buy across the board. as the yield comes down, counterintuitive, considering stanley fischer says we are not just one and done. after we saw selloff across the curve yesterday. move on thepoint two-year. in terms of the other areas we are seeing reaction is the fx market. you are seeing the dollar hold its games. the bloomberg dollar index is now in a three-week high. it's not on the board, but the dollar/yen is one to watch. it's the biggest losing streak in about five months in terms of winners, south korean yuan is moving higher. -- across the board, you are seeing dollar strength. it's a positive risk on day except for japan. they have relatively weaker macro data. the dax is up almost 1%, and russia and emerging markets up almost .5%. commodities are not the story today, but we see some weakness when we have a stronger dollar. relatively flat, as well as copper. iron or

a big question in the treasury markets, the big illusion has been revealed. oney coming into u.s. treasuries because yields are so low, but that return is slowly eroding the more that you hedge. this blue line is the 10 year yield. the white line is u.s. treasury's debt if you hedge it. the difference between the two in the beginning of the year was about 1%. the difference now is about 1/10 to pay to lend yen out, get dollars and return and that swap is the most expensive it has been for five years. here is another way of looking at it. this white line is the 10 year yield, this orange line is the 10 year yield after currency hedging. you can see the returns are actually -- the yield is actually below zero which brings analystsion, are accurate when they are warning against buying bonds? there is so much demand for dollar assets because the u.s. is considered the best house on the block. the third way of looking at it is if you look at 10 year -- in relation to the u.s. treasury yield if you hedge in euro terms. this return right now is right around zero, you

so iran air was a designated terrorist entity, so designated by the treasury department, approved by ite house because of its facilitation of terrorist activities on the part of the islamic republic of iran. on january 15th it was still a designated terrorist organization. on january 16th it was no longer, it was no longer designated, it was de-listed by the treasury, and on the following day executives from iran air were involved in the facilitation of that payment of $400 million. it's unclear whether it was an iranian, an iran airplane that was the unmarked cargo plane in question, but we know that they were involved in this transaction. this is important because it certainly suggests that the administration was talking to iran air before it was de-listed, in other words, when it was still a terrorist organization. it's also worth noting that the obama justice department has identified iran air back as far as 2009 as the facilitator of transfers of ied parts to iraq. and, of course, we know that 196 american servicemen were killed, many more injured as a result of iranian-made ieds

the u.s. treasurypartment has lashed out at the european over its treatment of american companies and their tax arrangements in europe, national -- super national tax authority. reporter: amazon, apple, google, and starbucks -- these four american investigated by european authorities for their tax arrangements with certain eu number states. the u.s. treasury department warns the eu commission against taking action, saying brussels is becoming a super national tax authority that threatens tax agreements on tax reform and countries' ability to set their own tax policy. the treasury warns -- >>'s investigations have considerable implications for the united states, in the form of potential tax revenue and increased barriers to cross-border investment. reporter: the criticism comes as the eu is expected to deliver its decision on apple the next monthnp13avoidance. >> a deal has been reached to compensate 650 called dealers -- car dealers in the u.s. affected by the cheating scandal. the figure put at $1.2 b

. >> the treasury department has lashed out at the european treatment of american tax companies in europe. they have warned against demanding tax -- back taxes saying it is overstepping its mark. this comes as the eu is set to give a ruling on the tax related -- tax arrangement in ireland. the obama administration has criticized the eu for singling out american firms. the treasury department says this approach appears to expand the role of the commission beyond enforcement of competition and state aid law. that reviews member states corporate tax, there has been no bias. genie: in france, a potential crisis in the wind sector. >> wine production is 10% lower because of extreme weather. saysgriculture ministry the worst affected regions are burgundy and beaujolais. vines are destroyed by freezing weather and hail showers. the current production of under 43 million could be a new low again after recent droughts. it would be interesting to see what our current heat wave will do to upcoming wine reduction. wherestay with france unemployment is coming down but some people are still looking for

the percentage in the u.s. treasury market. the squeeze on the u.s. treasury bills which compromise 11% of the u.s. treasury debt market, is getting worse. tom. this for you, it is another way of looking at treasuries and what the impact on t-bills is. let's get more now from eric nielsen. great to have you on the program. we spoke to a couple fed presidents over the weekend. i'm not sure with the market is latching onto. it is overall uneasiness of what comes next. the real momentum is the fed and central banks. >> i think that is right. for me, the stress test is not the big deal. with thento this year fed saying they would probably hike four times. communication from the fed has not been great. i think the market is really confused right now. francine: we actually caught up with robert kaplan. i think september is very much on the table. i think we will have to see how events unfold. it is too soon to jump to a conclusion on that. one of the things i've learned as a central banker, you've got to be patient and we've got time to make a judgment betwe

you see the treasury yields going down from 1.5, 1% today. buying in the treasury market. there was an option of 10 year notes and it drew the lowest yield we have seen in four years. it implies the highest demand. interesting we're seeing the strong demand for treasuries as they can be with sovereign debt around the world, negative yields. even 1.5% looks lofty by comparison. vonnie: never thought we would be saying that. julie, thank you. let's get a check of the headlines. mark crumpton has more. mark: a new poll on the presidential race in wisconsin. on marquette university sudeten shows hillary clinton with 52% of likely voters and donald trump with 37%. in a former contest, clinton is 47%, trump 34, libertarian gary johnson has 10% from the green party's jill stein has the support of 4% of likely voters. mrs. clinton has retained most of the bounce she received from the democratic convention. the bloomberg politics national survey shows her leading trump 50%-40 4% among likely voters. when third-party candidates are included, mrs. clinton's lead chance to close to the

the yield on u.s. treasuriesw one month ago at 2.8 percent, look at a rally in bonds push it down to zero? a head of rate strategies. 0% on the 30-year in the next two years? is the worst-case scenario. we have seen rates across the world headquarters 0 in europe and japan, and it kind of works the scenario to reverse course. in the system, you could easily see a run towards 1%, 0 obviously catches a lot of headlines. jonathan: for a lot of people, they are thinking crazy, 0, the ecb was trading at 1.4%, they touched 5%. the question that will be asked and has been asked here at you take hedging costs into account, with japanese investors based out of japan, coming into the u.s., there is not much yield left. the nominal pickup is huge, but the actual pickup is minimal. george: that is true. that is one of the reasons we saw a mad dash into the 30-year. thinkking aside, i do those that employ is hedging strategy, not everyone is hedging 100%. the viewers have upside, they might want to have their hedge misplace.

and by the debt from the treasury. think the message here is that there is so much demand for long duration that you do not need to go there. ratesral banks keep the at negative, you are doing a form of helicopter money. david: the central bank is saying, we want to buy it. wrong with the treasury saying, we will write some new 15 year paper? jurrien: and they can go in at auction and by as many as they need. it is happening in japan and europe so i think it is a slippery slope, helicopter money, but this would be a mild version of it. i do think that is where we are going. 2.4%,ominal gdp growth is productivity is declining with an aging population. that tempers what your perpetual growth could be so i think some sort of fiscal is coming. with plenty of demand for paper, they are doing it. the bank of england was only 52 million pounds short yesterday but it is the first time they have -- it has happened since 2009. the screaming noise out of the bond markets are saying, give us more. is,d: the other question why will

to bringrsued ways cash back into the country treasury unwinding holdings. meanwhile, israel's economy thanks toectations, surging consumption and exports. this reduces chances of action from the central bank including a cut and benchmark interest rates. speculation begin mounting opec may revise talks over a production freeze. equities followed suit with a bumper start to the week. managingto the effect theout the main source of income has on stocks. >> it is a general slowwn in the region because of oil prices dropping. most companies have not been performing as well as they should have done. mentioned, mr properties. it was mainly driven by the new home sales. thehospitality division, average revenue per room has been going down. new home sales have definitely increased. they have launched many new iconic properties. most companies, especially banks, have been struggling. not because of sales growth. more because of provisions. anchor: have you been surprised by the extent? >> not a really. there is no -- we need a good reason to take a provision on the ba

coming up in battle of the charts, i face off against julie hyman. today it is u.s. treasurynese debt. this is bloomberg. ♪ ♪ global battle the of the charts. let's take a look at some of the most telling charts of the day. you can access all of these charts on the bloomberg by running the function on the bottom of your screen. shery ahn kicking it off. shery: the tables have turned. the member that i gave you a couple of wins there. today i am taking a look at japanese government bonds. about $45 billion in extra spending from the government today. that is a fraction of the headline number announced last week. is the ball back in the bank of japan's court? last week the boj underwhelmed the markets. boj ist is that the running out of places to buy. they already own one third of japanese government bonds outstanding. this is causing problems for some investors who are complaining that the central bank has killed off market liquidity. it is plunging their in the markets. where is the boj going to go next? they are buying up etf's. they are keeping negative interest rates. it i

the carry trade has boosted treasuries in the u.s.is actual because the fear of united flechette -- of inflation is greater in the u.s. and that makes it cost more. jonathan: the other thing is whether the call of 0% on the 30 is the equivalent of 50,000 in 2007. five years ago, we said the bund the curve would be negative. we should not laugh. alix: and you just don't know how much it costs to hedge. jonathan: coming up, american security ceo michael fish will unveil his blueprint to be successful in private equity. this is bloomberg. ♪ david: the japanese government announces a 4.6 trillion yen in new spending is prime and mr. bobby seeks to prop up the economy. afteran: oil rebounds hitting $40 per aral -- per barrel. warren buffett rips into donald trump over his refusal to release tax returns. his attack on a fallen soldier's family and much more. david: welcome to the second hour of "bloomberg ." we are live from bloomberg's headquarters in new york city. a lot of action and european banks today. jonathan: you can look at th

the dollar holds it gains and yields fall across the treasury curve. repositioning ahead of the friday payrolls report? nejra: and another potential deal announced. potash and agri-amarin luminary .alks to emerge we will have a live report from toronto this hour. matt: let's go to the markets desk aware at the of doolittle has the latest. we are looking at a similar holding pattern to what we have seen all day. small losses for the major averages. the dow, s&p, and nasdaq are down modestly. when we look at a chart of the s&p 500, we see just how small this decline is, not a lot happening. this is a 10-point range. it looks a little dramatic on the intraday scale, but this is a 10-point scale. in the retail space, we have some companies on the move. abercrombie & fitch are crumbling, down 20%, on pace for the worst day since 2008 after the retailer posted a wider than expected second-quarter loss. it looks like there are real problems here in the u.s. along with their flagship stores in taurus locations. another retail disaster, g3 apparel. this is the w

as for the 10-year treasury note yield. rsing a little bit this morning with the 10-year jumping to 1.51. sent yields lower. takes us back to the lower 1.50s. the dollar was weak all day yesterday. now bouncing back a bit. stronger guest the euro and pound and even the japanese yen. euro dollar off by about .20%. initial job claimsed to. as for gold not moving a lot this morning. has been stronger on the back of the weaker u.s. dollar. it's flat down a buck. >> super low, but over 1% from the uk, and, of course, even further of a gap when you talk about germany and japan. crazy times we live in. >> that's where the center of the easing action is. it's why the british pound has been so weak: i would say overall, wilfred, we're seeing small moves, but what's important is stocks are holding the highs. we are right near record highs. whether it's earnings related, ralph lauren that jumped 9% yesterday in terms of the retailers. we'll start to get the department store numbers this morning. question there is how much of the bad ne

we have seen the biggest selloff since june in terms of treasury. alix: the yield rally some most since november. ofaking of the diversion years, charlie evans speaking, saying we do not need to hike rates. eric rosengren saying we can normalize rates. we are nearing our mandates. federal confusion. caroline: that is going to be our phrase today. coming up, we will speak about the direction of yields with matthew. managinggan stanley's director and strategic. he says by the five-year the five-yearbuy treasuries, despite losses. alix: a lot on hold heading into jobs friday. if any action, it will be in the currency market. the dollar is mushy across the board. the pound is higher, moving against the dollar. the yen moving lower. the yen is looking at its first monthly decline versus the dollar since may. is relative mushiness across the board. banks doing well in europe. into the jobsn number. in the bond market, selling. the japanese 30 year, basis points moving two basis points higher on the yield. in sweden, a similar story. yields moving higher by

this comes as the treasury department is being accused of a massive overreach. a taxes business group suing the administration saying new rules violate the law. >> i am very pleased that the treasury department has taken new action to prevent more corporations from taking advantage of one of the most insidious tax loopholes out there. and fleeing the country to get out of paying taxes. >> but in chambers he said they ignored the clear limits of a statute and rewrote the law. this is not the way government is supposed to work in america. >> kevin brady who was the chairman of the house ways and means committee is calling the new rules damaging. much of this is born out of the proposed merger that would have been worth about $152 billion a merger that remains on hold. kevin cork at the white house fox news. >>> new federal regulations are hitting the tobacco industry. the food and drug administration will also regulate e-cigarettes and cig ars. the new rules will have no affect on how adults buy products. >> these products remain legal for adults. but starting on a

in italy now is a fairly small fraction of the problem that was in italy a few years ago with the treasurythe fact that you say it was the right decision not to take the bailout program offered by the eu. a quick final point. do you think the eu and germany will definitely have to be flexible on the bail in of the italian banks if this is going to be resolved? mario: now that i am not in government, i don't have enough information, frankly. i know the rules of the european commission concerning state aid. i believe that as a whole, the movement away from bailout and in was a sound move. i believe that italy was in 2014 taken a bit toos much by surprise by a move that was negotiated in brussels and accepted by italy, but there can be a flexible handling of the transition in these initial phases of the bail in world. i'm confident that the negotiations between the european commission and rome, the italian political authorities, will be finally successful. and let's not always put germany on the front line. it is really the european union with its rules and germany does better. francine: very

>> i was duped by the secretary of the treasury and made a tool for forwarding his schemes. s in my political career, this, this is an occasion of the deepest regr regret. >> hamilton gets his way, but as the federal government exercises its power by taxing whiskey, pennsylvania farmers who share jefferson's views see this as tyranny. >> whiskey was a major source of income for farmers. so, the idea there's going to be a tax on that whiskey would cut right into their profits. demand response to this, a number of them got together and rose up in rebellion. >> you wish to enforce tyranny? we enforce a higher law! this is what we think of your whiskey tax! >> angry farmers come out in force, attacking tax collectors. some are tarred and feathered, while others have their homes set upon >> it's a privilege, your -- your excellency. >> the honor is mine. >> to defend the authority of the constitution and the presidency, george washington once again takes command of an army, only this time, his opponents are his fellow americans. esurance does auto insurance a smarter way, which sa

>> those are strong words from the treasury secretary. s been criticized in the past for doing some of the same things. jim and i were talking about pfizer and allergen in particular, you followed inversions as well, those are strong words. >> yeah. look, i mean jack lew views this very much as the european union trying to reach into the u.s. tax base. i mean so this is a turf war and it's about dollars and cents as much as anything else and a lot of legal principles thrown around here. but you're talking about $14 billion and who's going to get it and not get it. >> right. eamon javers from washington, thank you. >> makes a point. people on twitter saying that's all it's about, who gets the money which is clear that it will be, although by the way, there's no certainty we're getting the money because it's sitting over there. >> right, right. >> and when will it come back. of course all these companies, $2 trillion, waiting for that time that perhaps will be more advantageous tax rate on their overseas profits. >> well look -- >> to bring

i call it a convertible bond where you have a dividend with a call option of the future. treasuriesterest payments. tom: sallie krawcheck is the only one of the room who knows the underlying mathematics of convertible bond dynamics. francine: the "surveillance" theme. when you look at equities and finance in general, the problem is the more central banks do, the more negative rates are there, the more people look at price risks. sallie: yes. [laughter] sallie: yes, indeed. about environment and for the foreseeable future, we are in an environment that is not a high return environment, the individual investors have to adjust their outlook e-reader it is slow because it is easy to say, "i want a 9% return like we used to have," and we see it in the rearview mirror. the answer for particular investors is to invest steadily, do not sweat the ups and downs of the market, but invest over time and what we are seeing at ellevest, which is amazing, is that we are so early days, that 75% of our women are investing on an ongoing basis. so they are taking a bit out of every paycheck or every mo

after the constitution was ratified, george washington had to pick a first treasury secretary. he first asked robert morris, who had run the finances of the country during the second half of the revolution. morris was the richest man in america, but he did not want to do public service again. he wanted to make money. so, he recommended alexander hamilton, saying he was damn sharp. washington knew that already as he was on his staff. so he becomes the first treasury secretary of the united states in december of 1789, when he is 32 years old. and now, we come to what he did at the climax of his life. and the problem that he faced was debt. wars cost money. and the united states had no money. 5e are gone for the war, 8. year war, the longest war we fought until vietnam. longer than the civil war, our portion of world war ii, put together. but we could not pay for it. the government under the continental congress and the articles of confederation could not tax the state. they could ask the state for money. and if the states would not or could not pay, they did not have to pay. rober

you the treasury yields the backup, too.5% -- up from 9.5%. this get to involved in high-yield currency. i think it is an event for qe and something that would definitely -- alix: didn't we kind of see this when you have the doj, nonaction even a couple of weeks ago. you did see a backup in the yield. we did not see that contagion in the treasury market. >> one of the reasons you have not seen much volatility on the market is because the doj is still dangling out there and saying september is a meeting where they will be assessed policy and unveil additional measures. they dig up that meeting in a way that prevents people from selling bonds and buying began actively ahead of it. they know the doj has a tendency to surprise sometimes. if the doj does not deliver, that is when you get a repeat or extension of the moves you saw in bonds and currencies a couple of weeks ago when they passed on a cut. -- the you think this will be the catalyst in the scenario we painted out in the last five minutes? >> it is a tiptoe down the pat

particularly from the u.s. treasuryst the and shall thinking apple is being vilified, i find it surprising. it should be viewed a ds a reminder the tax rate here needs to be fixed either way. either way apple is not paying anything here. whether they pay 1% or 12% in ireland or europe should be seen adds not paying 35% in the u.s. and trying to atralkt the business back here. i surprised the stent of the fallout from a u.s. perspective to see that. >> i absolutely. it's a reminder the u.s. needs to reform own corporate tax system. the treasury had a problem with and wanted to block against and why treasury secretary has been meeting several times over the last year. they don't want any company being unfairly singled out here. there are a number of u.s. companies that do business in europe that do business in ireland and have perfectly legal tax structures that have been negotiated with the irish government. they don't want tech to be singled out. >> which i can see. i think it's more of a europe versus island issue. tax

even as you had the treasury selling off modestly. been a fixture of this recent rally and you have the vix at 13. it basically bumps around here it's telling you that nothing too scary's being sniffed out. friday's job report can up-end the whole story and hard to see the market giving you clues willing to fail here. >> that was the other major story of the day. the european union ordering ireland to recover more than $14 billion and back taxes owed by apple. ireland says apple doesn't owe them any taxes and what this is what irish finance minister told cnbc earlier today. >> we think the commission is getting involved and what is the competence of sovereign governments in europe. the european treaties say individual countries are responsible for taxation policy and this is an approach through the back door to try to influence tax policy through competition law and we don't agree with that. >> yeah. we spent a lot of time today talking about the implications for apple but what about business in the european union? michelle joins us n

by this time, the treasury was running out of money, the invasions into canada, all appeared to be failures lost a lot of men. and it was really unlikely that we were going to take over canada. however, we didn't want to retreat from our demands about the british laying off our sailors and confiscating our merchant ships. we couldn't back off on that one. the british were also intimating they wanted us to give up the indiana and illinois territories. we weren't going to let that happen. by the same token, the british by the way of turning up the heat realizing by 1814, napoleon had been defeated in europe were able to send some reinforcements from europe to shore up the defenses of canada and also turn up the heat in the chesapeake bay. so thousands of british soldiers landed in southern maryland in late august. they march toward washington, d.c. or washington city as they called it at the time, figuring if they could capture our capital, that could bolster their position at the negotiation table. the americans, though, weren't entirely caught off guard, the americans called up the militia

yield of't pushed the u.s. treasuries up. sellers, think more these are big central banks around the world getting rid of u.s. treasuries would push the price down. but it hasn't been happening until recently. i thought it was a cool chart. scarlet: private buyers are picking up the slack? that is what is going on? matt: i actually don't know why. scarlet: this lends itself to a lot of questions. is: here with more analysis catherine, the head of resources and chief global strategist -- he joins us now from miami. -- he joins us now from miami. what is next? emerging markets generally do well. we have seen emerging markets outperform developed markets and inequities. a lot has to do with what the fed does, and how oil develops, and the u.s. dollar. those have been the pillars of long emerging markets going into this year which has played out to our favor. scarlet: if that is the case in the jobs report bolsters the argument for the federal reserve to raise interest rates in september or december, once we get higher rates, it g

it looks like a loss for equities and a loss for the month of treasuries. is it for bloomberg markets p are what did you miss and the market close our next. here are the major averages. less than four minutes to go and close. not in rally mode. equitiesee a loss for this month. this is bloomberg. ♪ >> we are moments away from the closing bell. i am matt miller. joe: i am joe weisenthal. "what'd you miss?" scarlet fu is off today. lower,.s. stocks closing wiping out august gains. joe: the question is "what'd you miss?" ask about the g-20 the easen china and decision over apple's tax bill. joe: ridesharing companies have a flawed model, that is according to our guest. >> u.s. auto sales expected to slide, while annual sales fall for the first time in seven years. matt: we kick it off with market minutes. let's take a look at stocks. we had been looking for another rally. that would have made it five or six months in a row for the s&p 500? >>

jenna: jocelyn chancellor, chairman of the treasury department. nathan, you have insight on what it takes to make a payment like this so let's start there because you worked at the state department. they said no big deal, we talked about this, we told the public there was a settlement happening and more details are released about how we did it but it's no big deal. what strikes you about the way this payment was made to iran? >> good to see you again. i think that when you look at the way this was done it looks like what we used to call at the treasury department cash smuggling. this is essentially stacking dollars on a pallet and moving it in large quantities to elicit actors. you have to remember here that the ram is still a state sponsor of terrorism. the united states did this secretly in an unmarked cargo plane using huge amounts of cash because they could not use the formal financial sector. this is the sort of thing that we use to sanction iran for back when we had iran sanctions. >>. jenna: you are saying it's not normal because a lot of th

points,ing by 25 basis and something we pointed out today, the treasury etf. month at the money, it's as low as it has been. yellen did not speak at the jackson hole symposium last year. takeaway is that markets certainly on their heels. ifwill be interesting to see the commentary is on the hawkish side. >> pins and needles, for sure. us get closer to trade. it seems to be the week of discount retail. both falling off a cliff, basically. i believe dollar general has seen its biggest fall since it has been public. >> we cover dollar tree and dollar general. a little surprised by the earnings. that part of the population seems to be doing a little bit better. big reports, tomorrow morning. big still up 36% year to date provides a nice opportunity to put a hedge on. and that is what we want to talk about here. column.to put on a 57.5 assume your along the stock. point five strike call. anticipate earnings and stock moves up to that level. put around and have that 50 for protection in place. about $.20.ade was stocks of continue to come in. a very inexpensive way t

the hour. nejra cehic is talking u.s. treasuries heard the likes of bill gross it janus capital say government debt is looking too risky for the return now. significant opportunity and corporate debt. what this chart shows is the corporate bond spread over treasuries is at the smallest in a year. investors willing to accept this money as 216 basis points at the edge of the chart. spread and more than a year we are seeing a real reversal here because last year they climbed about 1% while corporate fell about 1%. this year the u.s. treasury bond index has risen 5.4% versus 9.2% for the bloomberg u.s. corporate bond index of investment-grade debt and within that corporate bond index your sink metals, mining and energy companies being the best performers where is financial and technology bonds have been the worst. overall it is this spread i'm focusing on in the chart. yield. the hunt for this action all over the place everywhere. that spread is very big relative to the outright yield on treasury. 1.5 is more interesting than 2% over 5.

the u.s. treasuryhedging costs have gone up significantly. the picture, you are looking at low yields across the world. investors will look at other assets than government wants. jonathan: looking at the auction on the 10 year, indirect bidders, there's huge demand. doesn't that tell you demand from abroad is still strong? mark: some investors buying treasuries just because they are trying to get dollar exposure. it could be a currency play. look at the alternatives. the 10 year rate in japan is nine is 10 basis points. germany, -10 basis points. european rates have come down significantly. u.k. rates down 100 basis points . 10 year sterling government bonds, 50 basis points. the 1.5% looks good on a relative basis. fair point, but looking at the pimco return holdings of u.s. securities and related debt, at 50% of total assets. if you make the case we have had these are options and there's other places to be, does that mean you will be reducing holdings? is it the wrong call for pimco? to deemphasize i

the amount of treasuries held by central banks worldwide. t we may be back to levels we saw in 2014. that is my red circle there. but the decline does not necessarily mean central banks are burning reserves. they may have switched to a reverse rather than treasuries. a different way of looking at treasuries today. tom: very good. let's bring in two smart individuals to get you briefed on what we will see later. stephen stanley has been phenomenal about a measured and quieter view on american economic growth with were out of -- with work out of washington. and joining us, carl riccadonna from bloomberg intelligence. steve, let me go to you. what about the revisions this -- whatback up steve: about the revisions this morning? underlying trend has been slowing down a little bit. it will be interesting to see if -- i think most people are looking at the july number to give us a sense of what the trend is going to be going forward. carl, what is your insight? you always have something twisted. carl: i think a 170 estimate is reasonable as a foreca

>> two business groups have sued the obama administration over the tax inversion rules that the u.s. treasuryartment put in place back in april. those rules were instrumental in blocking the pfizer deal. two companies have filed a lawsuit in a texas federal court that said that the regulation exceeded what the law allows the treasury department can do. the treasury didn't have the legal authority to do those regulations in the way that they did them and therefore they should be undone. you can expect that the obama administration will fight this. it might be too late for that pfizer deal, nonetheless and the obama administration leaves office at the end of the year. this might be political sparing but interesting the resistance groups are putting up to this. >> let's do our trader blitz now. four trades on four stocks making news today. first up is cheesa peek. it missed on the top and bottom line. >> they're selling off assets. it's recovered a little bit because it was much worse in the trading session and it's starting to come back a little. they're trying to raise capital because clearly

we will put it in an escrow account, and will be managed by the national treasury management agency, ich manages these affairs and the national debt in ireland. secondly, the european commission wearing a different hat and another part of their jurisdiction say that this cannot be spent for day to day spending. so if we lose the appeal, it spent forsent -- health services or day today spending, but it can be revealed reduce theto national that. there is a possibility some could be used for investment and capital project. the appeal process will take several years. i have no doubt this will be a matter for one of my successors. thank you for joining us. michael noonan. the european close next. this is bloomberg. ♪ mark: you are watching the european close. i am mark barton with vonnie quinn. five minutes away from the end of the tooth a session. rebound from yesterday's losses. more gains in london because of declining mining shares falling as the dollar rises. have a quick peek at the currency board. the euro is down for the seventh day in eight days against the dollar. that is giving

the u.s. treasury has said this isn't a fair ruling. there's no secret to e.u. is not a fan of tax policies favor a long time criticize lower taxes than the rest of the e.u. this doesn't surprise me in the dynamic of the e.u., ireland is not a big hit because taxes are so much lower. apple saying this is money we earned abroad. we will pay ta doing that yet.

before that senior adviser to the office of the treasury, secretary of the treasury. we are delighted to have michael with us tonight as well. next we have laurie goodman. she needs no introduction in this crowd. codirector of the urban institute housing finance policy center, along with elana mccarter. lori is a voracious researcher and publisher. over 200 articles and journals and of the five books co-authored and authored. she is well known among policymakers and the public about important issues on housing finance. last we have ragu, senior vice president for housing policy and capital markets at wells fargo. he was also managing the role of regulation inside of wells fargo. dodd frank, qm, atr. he helped start a platform and wells fargo for an online banking platform. welcome. >> thank you, faith. thank you for taking time out to be here. it's really an important topic. important for consumers. for the many participants in this ecosystem of housing finance. what i will do is focus on mortgage servicing compensation. something that remarkably has not changed in de

on to the market. treasuries are set for their biggest loss since june 2015. had a lot of hawkish rhetoric from fed officials. the dollar reviving. also that is weighing on metal prices paid oil swinging into the bull market. chinese shares leading gains an old global equities. european equities gain 0.3%. you can see unemployment -- we will have to look at the participation rate. the unemployment rate is better than expected. let's get to bloomberg first word news. >> u.k. prime minister marks the end of summer. may and david davis have chosen to not flesh out in public details of the breakout from eu. investors and executives -- to define what she means when theresa may says brexit means brexit. donald trump goes to mexico today for a private meeting with the president. meanwhile trump is also due to deliver a speech today in phoenix. he is expected to lay house -- layout his proposal on immigration. nine people are believed to have died at a nursing home in japan after a typhoon rocked flooding in the area. nhk says another woman was found dead in the regio

the treasury accused t.u. involving american company and said the effort was deeply troubling. >>> los angeles police -- there is activity outside chris brown's home. he's posting videos declaring his innocence as police seek a warrant to search his l.a. home. earlier today, they received a call from a woman outside the home, saying she assistance, and again, there were report she is was barricade inside. we will learn more an about this i'm sure. >>> have you noticed a change in your child the last couple of weeks? there could be a specific reason for it. >>> also today, the makers of epipen are scrambling to provide patients with a generic version, but why is it still so much more expensive than the everyone. can you believe august is wrapping up? with that, let's take a look at long-range mod models to see what is in store the next three months. right now our long-range forecast models are calling for above-average range for the northern united states and i'm not sure what will happen for way. long-range mod

and this is the spillover from equity into bonds. yields on treasuries coming in three basis points on a five year. now just 69 basis points on a two year. we're in three basis points on the u.s. two-year. the big move is you're seeing a weaker dollar on the crosses against every single g-10 currency. dollar yen, the biggest mover breaking in at 100. and historically, here's the story. you've go all the way back to 2013 for levels like this. after thereach of 100 brexit decision but to go back there again ahead of september 21 when you get that b.o.j. decision where the fecks backing off, is b.o.j. going to step off? >> and what can the b.o.j. going to do? they cannot get that hate rate hike? et's go to michael mckinnie -- mckee on that fed falling dollar. i want to start with michael, our editor. mike t not only dollar yen. it's also the swiss, seeing the highest level since brexit. when was the trigger for the weaker dollar? >> the fed is obviously a component in all of those moves john's talking about, expectations and futures trading haven't changed.

i'm looking at the degree to which equities and treasuries seem to be moving in lockstep. e seems to be no diversification. friday was one of the worst days in a long time for the multi-strategy indices that was a strong very. does the strategy you represent offer alternatives? >> it will behave more uncorrelated. moving into libor and taking advantage of this rise, which is technical and wonky, but will be mainstream and hit people if they see their mortgages go up, so it's a great way to get yield and diversify away from fixed income. matt: we are looking for a gain of 180,000. we got a blowout number last month. if we get a blowout number this month, does the fed go in september? i think there is a decent chance to go even if we get a decent number. report is typically disappointing, so if we, in line, that will be good enough. where i differ is that the fed spent so much time putting june on the table, then didn't raise. intos different is coming june, we had bad data after bad data. it was more than that. now all of a sudden you have the exact office -- opposite. infla