between janet yellen and kuroda, risk on. next hour.the ♪ tom: tonight, thursday evening in new york, it is friday morning in japan -- a more important meeting than what we witnessed yesterday with chair yellen -- michael mckee is all boj. michael: they have ruled out you willr money but get something that looks like it. the prime minister slipped into his speech that they will propose a ¥28 trillion stimulus package which would be impressive, if it were real money. know, the japanese tend to roll all of the previous spending into the package. so what is the real money? the yellow is the real money. is, will be get a lot of new money? tom: what are the dots on the right? michael: oh, that is what they ae talking about as possibility. and as you can see, you get more paying for the buck -- the nikkei. -- that is when you have fiscal spending. a may get a monetary package. there are three choices. lower interest rates, to buy different stuff like real estate japanese additional bonds. tom: let's back up. is he independent? he is.: he does

caseine: what is the best scenario for janet yellen? geoffrey: i think the stress, data is doing well, a goldilocks environment. do not cast any doubt about ,trength in the u.s. department but the stress in the international conditions, they need to be cautious about where the dollar is going, and after the brexit. tom: do you have a yen call? geoffrey: your risk is certainly to the upside in dollar-yen and at 100 i think the boj will defend it. how they will defend it will be interesting. if they do a big package, then dollar-yen will go to the upside. it is what happens after that which will be much more important. tom: looking at the fed and deutsche bank. .eoffrey yu with us with ubs this afternoon, michael mckee in washington, joseph wiesenthal and scarlet fu with our special fed coverage. 2:00 p.m. this afternoon. from london and from a beautiful, coal or new york, this is bloomberg. ♪ francine: welcome back to bloomberg "surveillance." i am francine lacqua in london, tom keene in new york. second deutsche bank's quarter profit wa

up, fresh insight this afternoon from janet yellen and company.raisingng rates after the may jobs report and rising global uncertainty. this is bloomberg. ♪ matt: this is bloomberg markets p or die matt miller. a bloomberg -- bloomberg business flash. capitalinal round from partners and wrong capital court and people with knowledge of the matter. private equity firms are --ected to hand in smartphones and cars. foreign homebuying in the u.s. has been a three year low. $10 billion in the last year the nationals nation of realtors. affordable and of course, the stronger dollar cut into purchasing power for everyone from latin america to asia to europe. apple is losing ground in the battle for chinese smartphone buyers. made up for 11% of all of the phones sold in china in may. increased its lead, the chinese company house -- has a 70% market share. that is your business flash update. joe: the latest minutes are out here federal reserve officials left interest rates last month about -- about the liver market and financial stability threaten outlook.

the janet yellen goes for stability by instinct. kit: janet yellen goes for stability by instinct.y won't do anything today. their problem is they would want to see really strong economic data in the next couple of months and wished they have done something -- they had done something. they've got another meeting in september. they are still looking at the -- which feels healthier than it did last time they met. they have some better domestic data. the risk sentiment is much less than some people have feared. francine: why is that? cheering -- wers think that it may never happen. but it may never happen or article 50 may never be triggered. kit: this is not the world's biggest economy though it is the home to a lot of us. it is mostly a u.k. economic hit that will come through slowly, steadily and be very big. it is a european head because we are already a trading partner for europe. after that, it tails off. money has, using trumped everything so far. francine: will talk inflation. kit juckes, global strategist stays with us. slowing growth and rising inflation as the bank of engla

janet yellen wanted to get back to the green circle.yield. do you anticipate further instability? in september or for that matter, next year? totally altered the notion of how quick they are going to go. even if you deliver one, it's not going to be for the year. the vector isn't there. it is a one move -- >> it allows them to go without worrying so much. and i think that's part of the reason why september is live. even the move we are seeing in bonds, it is a dovish impulse for them. tom: joe weisenthal, for basis points. scarlet: let's wrap up our thoughts here. tom: are we done? can we go another hour? scarlet: another 15 minutes for bill grossman. frankly, he's the most important guy in the room because when you have the series goingere, the miniseries on leads me to instability. that's where you will ultimately see it. ed fed.: the many-theory mike, what are your final thoughts? whatever fed can say it wants. the first paragraph of the statement was stating the obvious. the economy was better than it was in june. in the second para

yellen, stanley fischer, and dudley. tom: you are brutal.giter with us, governors and presidents this morning. i like the idea of labeling the dots. that sounds like classic willem buiter. absolutely. we are going to come back. we have a great set of guests for you to drive forward the conversation this morning. it is always five minutes after the jobs report from janus capital, william gross, on radio and television. stay with us. worldwide, it is bloomberg. ♪ tom: good morning, everyone. "bloomberg surveillance." it is jobs day. right now, to carry forward the leave debate, it is getting a little old, but so are the ramifications and the shape of the world. seth masters is with us, and willem buiter of citigroup as well. we have way too bad much academics on this. -- we have way too much academics on the spirit i was on the streets of london on the evening after that vote three what was it like worldwide for a b bernstein? seth: we positioned portfolios to take advantage of market upside, but with some protection on the downside. it was po

so, you know, with all apologies to janet yellen it doesn't matter what the fed thinks.es are going to stay low. >> did you hear anything from stanley fisher today that changes the view? >> not at all. the only thing i heard from him was a mild frustration that they couldn't get things going. the market is more powerful than the fed. that's the problem. >> now clearly he doesn't like being sidelined. seems that's the case. all right. thank you very much. appreciate it. >> when we come back, tim cook reportedly at least considering teaming up with jay-z, kanye west and madonna to take on spotify. why the company might be interested in buying tidal, next, but first, rick santelli, what are you watching today? >> negative rates take over most of europe. i'm watching our 30 year bond actually come off a little bit as it moves back toward the 2.25. but on a week of brexit all i can think of is the fed can't fix it and the fed can't inflate it. that's what we're going to talk about after the break. >> coming up on the halftime report. the markets are on pace for the best week

it overshadows janet yellen today.y clinton becomes the first female nominee for a major political party. david: welcome to the second hour of "bloomberg ." the bank of japan is the story of the week right now. they had a decision on friday. jonathan: i think it's the confusion of the past month. we don't know how much of this is new money and how much will be issued through bonds and what the boj can do off the back of that. citigroup came out with a note that said any kind of stimulus will probably set the boj back a little bit because they want -- want to see what kind of stimulus there will be. many years will the stimulus move out, $250 billion? david: there will be more bonds. alix: they needed. they are buying 90% of total issuance. made lasttory was night when hillary clinton got nominated. alix: we have a earnings coming out this morning and will speak with two ceos whose stocks have performed well -- will discussne ceo what is ahead in the pipeline. we have to take a look at the market first. think dollar

on the fed, janet yellen, if she raises rates sooner than the market expected, the news?overall, yes. thiamthat was tidjane speaking to francine lacqua who joins us now from zurich. francine, a surprise profit. does that mean his strategy is working? delicately. put it he says this is the first step but it is a clear first step in a right direction. the analysts called just wrapped up and he was cautious saying these were good results, better than the markets were expecting, however they are in a very unsupportive market environment. if you think about it, he has been in charge 13 months, three months into the job, that was last november. he announced a genetic overhaul. time, shareholders were complex in terms of execution. six month ago, yet to come down with some write-downs. concerns about how he would go forward and put the plant in place. this was the first time he can say you see it is working. it is a step in the right direction. probably good news that he had been waiting for a long time and that he needed. mark: he was adamant in the interview that he will not n

we will be talking italian banks and janet yellen next.billion boost chinese equity markets are supposed to get. a new investor with very deep pockets. i will to you about that next. this is bloomberg. ♪ -- y >> the playmaker could announce the sale of up to 100 airplanes as 12.75 billion dollars early as tomorrow. the country is said to be in discussion with go airlines indio regarding the purchase of about 78 planes worth around $7.5 billion. airbus declined to comment. deutsche bank says it may lower the threshold for approval. a decision will be reached later today after parties involved examining technical issue. investors have until tomorrow to tender their share. euro zone finance ministers meet in brussels later ostensibly to talk italian banks and the situation. but the regions finance chiefs have been in a room together for the first time since the referendum. that is the bloomberg business flash. francine: let's get some final thoughts from stephanie flanders from j.p. morgan asset management. you spent a lot of time talking abo

in financial services, how should janet yellen see this?i don't think she should be too worried. i was just looking at the survey by the recruitment company and what they pointed out was quite interesting -- they surveyed on -- a bunch of london professionals and where do you think the biggest financial markets will be in 10 years time? shanghai and hong kong. francine: where they want to move or where they think the biggest -- edmund: both. francine: despite the pollution. edmund: i agree with you. my son is in china right now and he said, you cannot believe the pollution. to me, i would rather invest in assets in companies. the huge problem is going to be how to do with the pollution. kind of guy a train and you have been known to do the junket around europe on trains. do you believe the city of london will exit to paris, frankfurt, london -- amsterdam, and points east? edmund: i wrote an article about that this weekend. i think the ultimate answer is no. just to tell you, i just arrived on the train from paris. it made me late for this s

tom: does janet yellen care?f you raise rates puts more pressure on overstretched companies. out andbert pointing bloomberg view that we have a real problem with rates because borrowing costs are so low and we are still seeing this default rate. tom: bring back the bart chart. mckie has been awesome on charts. 2007, that isith all you need to know, right? points out that we have artie passed all the dollar volume from last year. companies cannot pay their bills and the attention of higher rates in the united states, borrowing costs in 2009 were much higher yet we are seeing similar default rates. francine: some people are arguing the fed needs to go ahead and hike. --rew: i would disagree of with the characterization of the high-yield and default. i think the predominant names that are defaulting at the moment are heavily concentrated in energy. what we are seeing is not necessarily a function of countries that would be saved or , these the fed moving are companies that need oil to be $10 or $20 higher for their

tom: what would be your advice to chair yellen? what we have seen the last couple of days is good corporate earnings. even mcdonald's with their struggles doing ok, apple doing ok, according to the "surveillance" interviews we did today. it is a pretty good america, yet she is central banker to this troubled world. what would be your counsel to her for september and into next year? bill: i would suggest, and perhaps we will see some of this in august -- you will probably be out at jackson hole, and we will hear something more -- but i think janet yellen, not to be critical, but you are asking me, so i will be, as well as all are fixated on, the lower the interest rates go, ,he higher the asset prices go and they think it will benefit the world economy. i do not think it does. get off of the fixation of lower interest rates providing a push for economic growth. what you talk about in terms of apple and corporate profit, nominal gdp has only grown by 3.3% in the past several years, and real growth is down. if that is not normal, some

janet yellen is focused on this. one reason she wants to keep rates lower for longer and certainly it obviously is an important factor in what is going on in some of the news stories today. francine: our resident expert on u.s. jobs and economy. michael mckee joining us from new york. now, there is a great opinion piece on the bloomberg today which argues we should raise rates to stimulate the economy. that's welcome the author of the story. mark gilbert. and still others, some in french. we talkis is something about because it is a story that you came out with a couple weeks ago, and then you updated it. i imagine people are pushing back. you argue that we should raise rates tho shock the consumer. mark: the amount of feedback was saying, look at demographics. look at the fact that the over six to five's in -- over 65 in doubled.has they have all the savings. they spend the income but they do not touch the capital. if they've got no income on the savings, they are not going on cruises. you have killed off a huge sec

is it facebook or janet yellen? >> i think it's a little bit of both. a little bit of facebook because you have tech strong, you have apple yesterday, and i think it's all-time highs, i think some eyes are there to figure out whether the momentum could continue or not. so put it all together, there's a lot to like bullish-wise. liz: allen, you had only one to just stand back for the fed. >> right. liz: this was the point that i think really affected the markets positively. while the labor market has strengtheneddened, you have household spending is cooling a little bit. but cap x is really still soft near term risks to outlook diminished. it was a complete mixed message, the markets moved higher. >> right. i think the markets moved higher because there wasn't an event. it was when expected nothing was going to happen. but they didn't want to stick their necks out just in case. really we're going sideways in the few weeks in the range. we were at all-time high last wednesday, so it has been a full week and the nasdaq closing in on the high as well. what

janet yellen conceived this labor market conditions index. it's 19 different indicators that gauge the health of the job market. it's been negative for six months running now. it's the longest stretch since 2009. again -- >> now you're really backed into a corner. >> she sees it. and she doesn't know what to do. they don't know what to do. >> david. >> yeah, i completely agree with that. the problem is they should have started moving a long time ago. but at this stage i think they're just going to say as little as possible and tiptoe quietly off to the beach here because they could try and manage expectations, but nobody's going to believe them. i do think there's a possibility they'll raise rates in september. if we get two good jobs reports, janet yellen has an opportunity in jackson hole to talk about maybe the fed actually moving in september. i think it would be very unwise for them to wait all the way to december. but they've never found the perfect moment. but you never get perfection in life. i think they've made a big mistake by not

janet yellen uttered the word uncertainty no fewer than 39 times. the earning estimates have started to go up. the big question is brexit, whether or not the analysts start to taken a eraser out for some of the recent increases. back to the employment situation, i wouldn't say i'm bullish. this is one monthly number. i call it noise. the two things that i would actually pay attention to today in the june number, not the may revision, that's fine. even if you count the may revision and you get a consensus number in june, it's nothing to hide the fact than the trend basis. employment is slowing. that's a fact. goods producing employment, yesterday in the a.d.p. number is 30,000. we are going to repeat in payroll. that's five months in a roll of negative and that leads overall employment. and keep an eye on transportation services. in april, that was down negative year on year. it went negative year on year in may at transports were leading indicators. those are the segments in the report that people have to pay attention to. alix: if you tie in corpor

we are looking forward to a speech in wyoming from janet yellen. cracking the door open to the possibility of a hike. the real question is what yellen says in august. x: laying the groundwork for prepping the markets. we got a bit more clarity on e is going minister abbe to do. one fourth of that will be spending, but we don't know the timeframe. jon: there might be a consensus among economists, there is no consensus in this market right now. david: i'm looking forward to that. we will speak to a man who knows the fed very well. alan greenspan will be joining us in an exclusive interview. we begin with breaking news. ford earnings just crossing the wire. the company making $.52 a share. estimates were for $.60. revenue,of actual coming in a bit stronger at $36.9 billion. the company says it is committed profit.6 pretax it it does warn that could be at risk even if u.s. sales of its suvs pick up. we always want to look at pickups. they missed on their earnings per share but were up year-over-year. beat.and revenue did year-over-year and quarter on q

and vote they will have a big say in the election particularly hear donald trump talk about janet yellen and zero interest rate policy it might becoming a political issue, don't you. >> it is becoming heavily politicized. david: it should be. this affects everybody. >> if you look at fed balance sheet at $4 trillion. guess what the imf couple weeks ago came out and said middle class is at 30-year low. there is concern from global regulators. what has quantitative easing really gotten us? gotten us stock buybacks and nothing for the real economy. david: let's be clear. got wall street a lot of cash and killing middle class and savers. talking about inflation not being high enough. "wall street journal" had a big piece over the weekend how middle class parent are getting killed. price of raising a kid going way up. going up at twice the rate of inflation. while we're being told by janet yellen and other muckket at this mix, middle class know there is inflation. >> education, health care, no question there is inflation. now the question with the fed having limited tools being on the sidelin

this is something that janet yellen yellen was pressed on in a recent q&a, where implicitly in your growthtrong productivity number. tom: we will talk about this later. do you amend your fed call, given this new caution on u.s. gdp? we took all rate hikes off the table until further notice. there is no argument one can make that rates need to rise further in the u.s. ask yourself, is this an economy that looks like it is overheating? does the fed need to step in and tighten financial conditions to slow us down. the answer is, no. tom: this is stunning compared to what we heard from in shepherdson in the previous hour, isn't it? guy: the difference is fairly stark, and it is fascinating to hear you talk about productivity. we have incredibly cheap credit, yet ceo's do not want to invest in improving productivity. it is not in their interest. how do we change that narrative? are we treating debt and equity correctly? how do we fix this? producing more debt does not seem to be resolving the situation. ellen: with business investment, we have to look at, yes, debt has risen incredibly in the c

it doesn't look like is going to be a rate increase coming from janet yellen. me about the de-globalization concerned. guest: the brexit vote was part of that. people are saying we don't want our local economy did hated by an internationalist group and we want to limit immigration. that is something that has happened in britain and is going on in france. there are a lot of aspects to donald trump's campaign that appeal to similar instincts or feelings among people, concerns they are being left behind by globalization. matt: a fascinating story. coming up at 3:00 eastern time, bill gross will be joining bloomberg markets with reaction to the fed minutes and his advice for fed chair janet yellen. shery: you are looking at live pictures of -- live pictures of hillary clinton speaking where she is questioning donald trump's business record. you can watch her whole speech at the bloomberg live go. this is bloomberg. ♪ mark: you are watching bloomberg. lonnie: another blow to apple in six plays, drops to losing ground in its biggest overseas market. milan is close to

also what janet yellen cannot do next. stay with "the pulse."ow does europe's largest toy company plan to expand in an uncertain economy echo we will talk -- economy? we will talk brexit. three u.k. property funds stave withdrawal. brexit is a crisis work britain and globalization. this is bloomberg. ♪ francine: this is "the pulse." let's get to the bloomberg business flash with nejra cehic. makeup consumers in the u.k. -- nejra: consumers in the u.k. are preparing -- against smart card. this comes two years after -- the processing fees the company charged were unfair. the claim which could be fired -- be filed by september would be the uk's biggest and one of the first filed under the 2015 consumer rights act. china resources building is to raise -- in hong kong shares sales did this help finance the purchase -- with sabmiller. sylvia bellis coneys long quest to find a new owner -- appears to be close to a conclusion. that is the former italian prime minister says he agreed to deal with a chinese group. he also said the condition of the sale is

miss yellen theirs to do it next to the election. -- ms. yellen theirs to do it next to election. idea ofly like the negative interest rates. angie: it means that more people have to save more because they are not getting yielded. also it means that you are going to have to look elsewhere for investments like housing, the likes. most people are living in really hot property markets. tobias: [indiscernible] the results of the central bank policy are great for policy and the debtors. -- whether it is a dutch pension plan holder. these people are feeling the brunt of it. angie: it affects with what we started which is disenfranchisement between markets and the real world. tobias, i'm going to leave it there. coming up, drumming up is this in israel. he begins his courtship of africa and uganda. find out what is on benjamin netanyahu's agenda. this is bloomberg. ♪ angie: welcome back. this is "bloomberg markets: middle east." i am angie lau. netanyahu arrived and after on monday -- boosting diplomatic ties. elliott goc and has more from tel aviv. elliott, for netanyahu, the chip is al

get anyone't interested in what janet yellen and company are going to do? does this change the calculation of when they might move? bill: i don't think so. they still have brexit to look into. they have problems with the italian banks. the fed does not, but the e.c.b. anti-eu do. problems with u.k. property, mutual funds. of illiquiditye in markets. concerned with markets to the extent if there's discord around the world, i think the fed stays where it is. they want to raise interest rate spread they did it once. i think they want to have us believe they will raise several times and have a positive yield curve which will help banks and insurance companies. for the most part, i don't think this changes much. >> wage growth picked up a little bit. highis kind of near the that you usually get at the top of the business cycle. everything looks right. one problem is employment rates are very low. that is a significant issue. away are we from full employment? >> my calculations suggest even if you correct for demographics, if you look at current hiring rates, the

we talk about the fed and janet yellen. "surveillance" is up next. will join me from new york. the st. louis fed president james bullard. and we will hear from the conservative party candidate michael gove. hugo launches campaign at 11:00 and u.k. time. this is bloomberg. ♪ francine: yields take a dive. bonds and stocks rally on central bank, japan and the u.s. betraying boris, the justice secretary says he's the man for the job. brexit banks, the federal reserve joins us this hour, where we get the view of a new regime in st. louis. this is "surveillance." i'm francine lacqua in london. tom keene is in new york. we do have some euro unemployment figure falling, actually the eurozone area is not doing to

he's the core of the fed, the number two to janet yellen, that is coming today. >>> speaking of the u.s. central bank, st. louis fed president james sticking with the view the policymakers need to make a single increase to interest rates. speaking to reporters in london says doesn't see the brexit having a material impact on the u.s. over the next two years. clearly thinking about the long-term even though he's not committing his forecast in the fed. >>> aa plus rating. issuer of the nations leading reserve currency. in contrast, s&p cut its rating from aa to aa plus. the ability to stay united post brexit. it also learned that the eu may have less bejt flexibility. >> we're going to talk about that in just a couple of minutes with a top guest of the show. let's hear some more corporate news. opening an investigation into tesla cars after a driver was killed using an auto pilot mode. the crash occurred in may. in a blog post tesla says neither the driver or the auto system noted the truck against the white sky so the brakes weren't applied. this is the first known face-to-facealty in mo

why not build in a cushion. >> what is chair yellen waiting for?think that she is looking at global growth as well as the u.s. growth. she has time. the reality is you do not have a lot of inflation out there and there is not a lot of risk. certainly, we one have a runaway of inflation for the upside, so she wants to make sure that whatever she does she does not impair the recovery that we have going. joe: you say that she has time, but we have economic data looking to improve and there are various measures that show that the fed is not very far from hitting the inflation target, so is there any risk that inflation could force the fed to go -- before anyone expects? i do not mean runaway it -- runaway inflation like crazy. guest: hitting their target. i think that the market has a risk of underpricing what the fed could do, particularly if global growth develops in a better way than it has been developing. so far, there -- that has not been the case, but it is something that people should be wary of. scarlet: looking at the monetary policy around t

the janet yellen-led federal reserve released minutes from its last meeting in which they left interest rates unchanged. uncertainty in the market played into their decision. the meeting occurred before the brexit vote. and walmart is rolling out its walmart pay system. walmart shops are can connect a debit or credit card to the wall march app and pay by smart phone. >> when you're looking for a job you're usually economchecking o salary and benefits. and if you have student loans, this is something you're going to want to hear. kayla tausche has more. >> jennifer started hearing certainly worrisome last year. >> we heard that student debt was an impediment to moving forward in life, whether it was buying their first home, getting married, for one person even dating. >> and fidelity put together help, getting $10,000. >> i had about $50,000 worth of debt. and he paid off more than his mortgage. >> 401(k) is really nice but i've accumulated a lot of student debt and this one is really important to me. >> there's currently more student loan debt than credit card debt in the u.s. this year

are your managers working with a yeah but and that is janet yellen?the only way that markets could continue to advance and not have significant disruption in economic activities is if you don't have a major policy mistake in the world. in our opinion, early in the year, the fed raising interest rates, flattening the yield curve, raising the dollar and tiny conditions was a policy mistake but markets corrected as expected. you come to the weaker period to find that global policy is going to be more, they given markets rebound, as would have expected, then you have a disruption that does breaks it. i would've expected breaks it would have been -- brexit would have been a bigger distraction than it has. ofs would extend the periods policy combinations and investors are coming out from january to june. the i think you just said punch bowl is full and overflowing. francine: he says that moment that brexit is contained. do not think that as people realize what brexit means, it means that there wondering is there is a general election if we can go back on th

they want to see it recover and this supports the notion janet yellen had. >> wall street fed watchers say the combinn job growth plus the economic uncertainty from the brexit vote are increasing the odds of no fed rate hike this year. i'm hampton pearson in. >>> now to bob pisani at the new >> what happened? two days ago, we were talking about a trading range for the s&p 500 between the old high of 2130 and the february lows of roughly 1800. we came very close to those historic highs regardless, it's been a remarkable rally. what happened? the bulls are arguing that the strong june jobs report had created a goldilocks scenario, but the fed is is still on hold. the bears are insisting this has nothing o w they say the rally the is due to u.s. stocks an bond, partly due to foreign deman and because investors are forced into stocks because of a lack of alternative investments and because europe and china stock rs a problem right now. they both could be right and it was a broad-based rally. nine stocks advancing for every one declining and new highs kept expanding th suddenly, on the new

yelena: it will probably be less relevant because we heard from chair yellen extensively. they were concerned about the brexit. so there will be a lot of discussion in the minutes about the brexit because it was upcoming, and they were discussing what cautions to have. we will also be looking for clues about what caused them to doubt grade -- to downgrade growth. dax downgrade as well. alix: thank you so much. if you want repercussions, you have to talk about the u.k. property markets. jonathan: yes, and we will spill over here. three of the largest u.k. real $12te funds have gauged billion of assets. i want to bring in jack sidders here at bloomberg. let's talk about how the dominoes fall. you just wonder the contagion effects and whether it spreads. one bright spot -- how many of these funds are there? which obviously does not look good, or member and what happened in 2007, 2008, i am really starting to worry. i think it is important to point out that it is a different landscape now than it was back then. ofo in terms of the position the market, so we are expecting more

what politics do, what janet yellen does is much more difficult. charles: jason, the question whether the central banks of the world including our own fed which will be reporting tomorrow have lost their way? they're not supposed to be just for rich guys on wall street, right? >> true. they do have two mandates, price stability and maximum employment technically but i think we know there is a little bit more than that going on behind the scenes. with that being said i agree with jonathan, i'm a bull on stork market but more importantly for viewer, they need to watch the russell. the russell is only major index that has not surmounted all-time high. that will go up more than other indices. charles: gary, i have to turn it into politics. we're hearing a lot of talk about a rigged system from both democrats and republicans. i think central banks are pretty much proving that right. >> here and around the globe they have rigged every market, every asset price, every data point and you're seeing some outcomes at it. because of easy money, you get a ton o

janet yellen, chair of the fomc, has been clear that when they are close to theo lower bound, they have to take into account that there are asemitic risks to raising rates too soon or too quickly. meaning when you're close to zero, you better be extremely cautious in how you proceed. that's why we believe we are just going to see the fed sit on .he sidelines with morgan stanley. >> fed governor says he wants to see more evidence in inflation before raising interest rates the next time. he has a vote at every fed policy meeting, said the approach made since following britain's vote to leave the eu. he said it may be some time before it's clear how the vote will impact different economies and he described the current economic environment as you guessed it, uncertain. >> and that is p out in uk property funds. following the brexit vote, investors grew concerneded about values.oo as a result, owners of uk funds asked for their money back. today, three more funds halt to to six. that means half have been frozen. these types of funds cannot quickly liquidate their holdings to meet redemption.

yellen is being overly cautious. think sometimes central bankers have been a major element of the callback from the global financial crisis in some of the moves that were taking -- taken. some of the moves were important to get the economy back on his feet. i don't think there are a lot of on to endorse whose new business develop an idea is resting on further interest rates or 25 basis points higher lower from the current level. we are in a situation where we have an exaggerated sense of the importance. i think it is other aspects that are going to be driving global growth from here. we have the bank of japan and perhaps the market is exaggerating the boj's importance at the moment, so much hope being put upon governor kuroda to up the ante in terms of stimulus. on my bloomberg, we're seeing how far negative rates have come as the japanese debt. the plunge in the purple line beat the 40 year yield in japanese debt it we see the 10 year tumbling in the white line. -- clearly we are seeing negative yields across the bo

the same fed courage from janet yellen?they are data dependent, it concerns me that they are less geared toward their number one mandate which is price stability. we want economic growth with price stability. i think that is one of the concerns the market is missing is that ultimately, the fed stimulation will prove to be inflationary to the economy. tom: we will get down to that in a number of years. j.p. morganook at earnings today as will we. we bring you a wonderful voice on television and radio. he will talk about the exceptional optimism on american ranking. -- american banking. this is bloomberg. ♪ tom: good morning, everyone. scarlet is in london. there isew york and lots going on in the united kingdom and washington. we will go to our morning must-read. david sowerby is with us. this is our morning must-read and this got huge buzz. republicans have lost the popular vote in five of the last exit elections -- -- the last six elections. this got huge buzz on the internet among right and left. you are living in a rust

yellen has told us, lower, longer. doesn't really matter what she tells us u quite frankly. rates are staying where they are. you have to search for yield and you're only getting that in the equity market. >> stay on energy for a second. on "power lunch," we showed a chart of the energy etf to the s&p 500 for six months. they tend to track together. lately they have di vernverged. if they resume, the markets are going to go down. >> you believe that will happen, yes or no. >> listen, i do believe that will happen, yes, to answer your question, but what i will say is i thought a number of correlations would take the broader market lower over the last six months and it hasn't happened, so, should it catch up to xl, yes. >> it's the xle versus the s&p 500. and you can see, they're not perfect. but the peaks and valleys tend to correlate. oil has rolled over on the far right side. the write line coming down. >> bring it up. >> i don't think it is. we know why stocks -- >> there's a one-year. zpl is that correlation? >> you don't think that's correlation? >> i don't. i think i se

the janet yellen fed federal reserve did what it was expected to do this week and left interest ratesnged and it did say risks to the economy has diminished and unless the post was for a possible hike in september. and your next barista, the company announcing it is relaxing dress code which allows fedoras as well but still no hoodies and the familiar green app ron stays. >>> families with disabilities have a difficult road but there is a new tool when it comes to saving for the future and after years in legislative limbo, states are getting these programs called able accounts off the ground. sharon epperson has story of how one family in suburban chicago is jumping for joy. >> 11-year-old maddie gillespie is curious and outgoing and loves playing in the backyard. >> maddie is money an amazing kid. >> reporter: her parents are like many two-career couples. busy juggling work and raising three children, including maddie, who was born with downs syndrome and may continue to have special needs as we gets older. >> we want her to work and be engaged and do what makes maddie happy and with

tom: you wonder if july is a dead meeting for janet yellen. steven saywell, thank you.bnp paribas. we have a wonderful hour for you next, ian bremmer will join us from eurasian group, and david landau on capital flow, money flow, and current account surpluses. let me do a data board going out. moves,al banking deutsche bank having a sporting day along with other european banks. this is bloomberg. ♪ tom: this morning, markets continue to deteriorate. sterling and the german 10-year to new lows. united kingdom commercial real estate faces crisis. , the exit, italian banks are broke. hour, ian bremmer and david folkerts-landau. and china watches the west. this is "bloomberg surveillance." , ande live from new york eventful wednesday, july 6. i am tom with francine in london. opening, ae a 5:00 little bit of market stability in the last 40 minutes. francine: you are an optimist. i would look at the banks, a lot of the italian banks as we are looking for resolution, and i would look at the political landscape. here in the u k we are expecting the iraq war reports. it will pr

contradicting all of this data-fueled decision-making from janet yellen and his colleagues there at the think that this is a new chapter for the federal reserve governors to talk about what is going to drive decision-making forward? i think it is interesting that these comments have been made. when you look at the recent data, it has been good. nonetheless, retail sales were good. on the face of it, this would also just that they are still on track to raise rates. what is more interesting is that these comments suggest that there is not a unified view in the federal bank unlike the greenspan fed, janet yellen is struggling to get his unification. we are seeing quite a divergence. it doesn't mean they are not going to hike rates, but clearly there is much more divergence than we have been seeing. a centralin, this is bank governor that values consensus, so perhaps this divergence is interesting to note. let's talk about ecb, what decision will they make? guest: we think there is no change. they may hint at further moves, perhaps the extent of asset purchases, we could see a delay perhaps

julie: the minutes of a june meeting reveal janet yellen and policymakers have interest rate holds becausen the jobs market. vonnie: before the timing of higher interest rate. let's has straight to the markets desk were shery ahn a has been keeping and i and things. out anad the fed minutes hour ago and also have the report

chair yellen will deliver her remarks, and she will try to incorporate everybody's opinion.ts listening to the voters more. we have heard from more hawkish voting members, recently president george suggested that she wants to see higher level of interest rates and she might be sent at the next meeting. shery: we have the fed's beige book at the top of the next hour. what are we expecting their about the state of the economy? >> the page book will cover the period from the end of may through the month of june. we have seen it pick up in economic activity according -- we saw a pickup in hiring pace. it should be ok and should indicate that overall pace of economic growth has been moderately increasing. we should see a pickup in consumption but there will be some pockets of weakness because of the strong dollar. scarlet: how relevant is the page book for -- beige book for the fed? it's not really quantifiable versus some of the other metrics the fed relies on. how does janet yellen full that into her assessment of the economy and balance of risks out there? >> the tone of the b

i think janet yellen has done a fine job running the fed.on't think she's done a great job in terms of communicating and finding a framework to communicate -- >> isn't the problem that they're trying to communicate and they probably shouldn't be? >> i don't think so. i think there's a lack of a framework. >> i think you never mention it until they actually do it. then we'll talk about it again. >> the transparency has given us a lot more to talk about but not really. >> and then there's 16 guys talking every week about whether they're going to raise. >> we don't talk about it just because we want to hear ourselves talk. it moves the markets. and the markets are exquisitely tied to each of these things. >> and then it moves back. >> then it goes the other way like it did today. >> steve, appreciate it. >>> when we come back, eli lilly's succession plan. just one day after appearing on "squawk" to discuss quarterly results. he's back and this time with the man who will be replacing him. their plan for the pharma giant coming up next. check out

by janet yellen that the may jobs report was a one-off.at measure shouldn't we say that june is a one off as well? we have not seen a sustainable trend yet based on june. i think it should be september at least. that puts us in a time range where the central bank might or might not act to raise rates. the question is, within the next three months, how do we know that global weakness will not impact u.s. economic recovery? >> good point. it's not just the jobs rate. if you look at base metal prices, they are stabilizing and recovering from depressed levels. energy prices have consolidated and started to improve. the brent crude price is not where it was two years ago, but 25 dollar reach those levels that analysts were calling for three months ago. post-brexitat the follow, it has been contained. the bank of england at the table making sure there is no financial contagion. what you will see is the fed making the case for its next move. we said at the beginning of the year that they fourth quarter was the most likely on this program on recor

janet yellen said there would be consequences in the financial system.ors rushing into bonds. you can refinance a mortgage because they are still low. several fed members wants to raise rates soon. some feel the fed has blown its chance. aga again, if you are on the fence of refinancing or buying a home, take a look. >> the brexit throwing a wrench in the fed was plan. >>> "early start" continues right now. >> announcer: this is cnn breaking news. >> we are following breaking news this morning. a new officer involved shooting overnight. a black man shot and killed by police during a traffic stop. dramatic video captured the aftermath of the shooting and it was streamed live on facebook. >>> this as the fbi and department of justice meet over how to investigate the police killings of alton sterling. there are new protests in that shooting and a new video as calls for justice grow louder. >>> good morning. welcome to "early start." i'm christine romans. >> i'm boris sanchez. it is thursday, july 7th. we are following breaking news this morning with what ma

amanda: janet yellen waiting for overwhelming evidence before another rate increase. joe: the democratic national convention kicks off in philadelphia amid a unity problem. we get a live up eight in minutes. and nintendo falls the most after dashed pokemon go hopes. amanda: we begin with the market minutes. the dow and s&p retreating as oil prices tumble. if you look at volume, it is below average. there is not a lot of momentum with the s&p 500, they have not had back to back gains or losses since july 14, so not much to go on. joe: 20 out of 30 dow stocks falling. if you look at the s&p, energy is the culprit. consumer discretionary in the green today. amanda: commodity prices across the board suffering today. oil falling below its 100 a moving average for the first time since april and that really did take the energy sectors down. torlet: are we moving on bonds? amanda: i think i'm going to start with the stock of the day and that is yahoo! monday -- one of the most leaked transactions we have seen. a 4.58 ilion dollar transaction. the question going forward for ya

i always thought the yellen fed had a way of not making waves in the market. despite the fact that apple had a giant leap .oday that is one stock to keep an i on. falling bank is concerns about whether the turnaround will deliver. they are still weathering cost but can they, generate enough income from their investment banking business to turn the ship around. board.lower across the they have whipsawed a little bit in the immediate aftermath. the grind lower continues. the yen is selling off. >> everyone's looking ahead to big central-bank meeting friday. the boj is up next. , the economy grew faster than expected before the brexit made an impact on the real economy. economists are looking for gdp to fall this quarter and next. let's talk about oil. joe: it's starting to tumble. it was below $42 at one point today. ,t has been trailing off inventory piling up. that seems to be the story. they moved in the same direction. the story over the last month has been oil declining and the overall market not caring. shrugging it off perhaps. >> let's take a deep dive i