Yang yang looks at the midterm millionaires and the impact on future elections. The centralith Banking Committee trading on highfrequency trading. We begin with a warning from the u. S. Attorney general eric holder. Threats from syria could spread york to the west. Officials have grown increasingly concerned their International Counterparts are not doing enough to spin the. Eople in and back out of syria in most call a major speed today, eric holder pushed u. S. Allies to do more, calling syria a cradle of violent extremism that created global crisis. He went further, saying it in the face of a threat so grave, we cannot afford to be passive. He laid out a four pronged international approach to counter what is coming from syria, including tools for european officials, a boost in undercover operations, many of which are going on right now inside the u. S. And a concerted outreach effort to muslims muslim nations around the world. Try to stop the move toward radicalism before it starts. The how did they quantify threat in his remarks . Nearly 23,000 extremists are currently operating in syria. 7000 that are foreign fighters, dozens of them are from the u. S. The fbi has already arrested individuals seeking to travel from the u. S. And undercover operations, including a few weeks ago. It is worth noting and 22yearold florida man recently blew himself up in a suicide bombing in syria, and it marks the first time america was attack. In such an it is reaching our borders. How realistic is it to expect cooperation on traveler lists . The primary concern from all officials involved is that foreign fighters who travel through europe and the u. S. Can do so without a visa or citizenship. What they are doing now is trying to coordinate. These are extremely difficult to streamline, just inside the u. S. Are seeing right now, there is a recognition that inside the u. S. Lawns wasnt community, there has to be a big to try to fix and streamline the internationalist and improve them if they cannot fix it entirely, and find some terroristsent more traveling from syria. Thank you. Some of the biggest players in the business told the u. S. Senate they are not doing well with the equity markets. They call for regulatory reforms which could call for big changes in the socalled dark trading platforms. The senate Banking Committee included the ceo, the top official at the intercontinentalexchange as well as top officials from invesco and nasdaq. America has the most deepest and liquid Capital Markets and isity training trading strong. There are problems in those markets brought on by a group of highfrequency trading. In the there are new issues regulators need to address to restore Investor Confidence in equity markets. Ahead of the continental exchange, he says one of his answers send more business to regulators. We believe we should enhance competition by giving deference to transparent Training Centers where workers compete with one another and provide information to all others. Had his own list of ideas. Among them was more transparency on where their orders are going. We believe they should require brokers to publicly report consistent and standardized execution Quality Metrics in a way that allows Retail Investors to easily compare a performance. We can empower Retail Investors with information about brokers execution quality and position them to make informed choices. Testifiedwho suggested regular scrutiny for High Frequency traders. Theole host of ideas that panelists all said were necessary in order for Investor Confidence in america positive equity markets to be strengthened going forward. What about congress question mark on law our lawmakers in this area . X even though they have got their Third Straight hearing in the last three weeks, congress is not looking to legislate at this point. Theyre looking to the fcc to promulgate regulation. Democrat of ohio if he has confidence Mary Jo White is a to the task and here is his answer. With the fcc. L i was the only one who voted against the confirmation. Not personal and not in any way other than thomas i think there has been too much wall street influence good i am generally satisfied so far. She have to show if she is aggressive on this. The jury is still out. Brown and other lawmakers does not act, sec they will get into the game on their own. Peter cook on capitol hill, thank you. Argentina fights back. Their government says it has complied with debt obligations so the bank of new york is violating contracts with trustees. Latestined now with the on a copy of the legal notice. With thefter a Meeting Point negotiator. What happened . Before i ask you, we should mention, there are advertisements and then there are advertisements. Sure. These are two ages in the New York Times and the Washington Post today. You can see basically what they , they are completely saying we are not responsible at this point. Distributed, they a judge over a week ago had said they cannot does verse because they had not also paid the holdout. Yesterday, they met with the Government Official who came to new york. For met with a mediator these talks for about four hours. Officials, they were pretty optimistic after these meetings. They did not say much. Said they couldnt cannot really negotiate until they have a stake. The orders will be delayed. They want the orders delayed so they can negotiate without rusher, so to speak. Is argentina fighting with the hedge fund . Do they have it on two fronts now . Yes. It is in a tough spot. Argentina basically says you are violating a contract and adding them up to do. They are saying this is completely your fault, we complied with our obligations, and if you do not disperse the funds, youre violating the contract there it what is being said about the progress he made . They are more pessimistic. In the Financial Times yesterday an oped saying we have invited you several times and you have been at several meetings in new york. They came to washington and the United Nations and they were here yesterday. They did not sit down with anybody from the hedge fund. Showsay or putting on a and are not really taking much action. They want more concrete talks. Water their recourses at this point . Totheyre coming together form a Creditor Committee of swords. We reported yesterday the law firm held a call of other holders of bonds to see at this time. Re argentina wants to settle all of its holdouts and not just once in this lawsuit, that would anyone elseood for holding bonds. Because of the Supreme Court decision on this, does argentina have any more recourse . It is done. Done. Courts, they are the Supreme Court gave its final decision and that is over. They say they can pursue lawsuits in haiti and other places. Courts, the verdict is out. Thank you. Up, the Unemployment Rate is heading lower, but the fed is still concerned. We will find out why when we continue in a moment. Job openings in the United States are at a sevenyear high. The number of positions waiting to be filled rose in may. It is the most since june of 2007. Joining me with more is the direct employment bygs one month. The figure is 4. 6 million job openings last month. The economy nearing full employment . We think we are getting closer with each month, closer than the fed does. Either way, because it is difficult for economists to agree on where it is, we know with each passing month, the market regulators are getting better. For janet yellen, it is not quite good enough. Looking at wage growth. The other indicators look good. We have still not seen an acceleration in wage growth. That is been in the focus of markets and our clients and janet yellen. A survey was wreaking recently conducted about Interest Rates. What did dissidents say about what they thought the fed timeline would be . The bond market today is priced for around august, a. Atesummer increase that compares with the fed communicating around 2015. Not far off from what the fed has been communicating. That is in line with the results we had conducted. Even aside the feds own thresholds . The participants think they will hold firm on rates . Yes. I know we have been getting a string of better data. That is great and it has pulled forward some expectations for the rate hike. It is consistently better data. That employment report was stellar last week. We have to ask ourselves, is the better incoming data in line with expectations or beyond what the fed is expecting . They have been telling us we growth thisstronger past year and beyond. The better incoming data might simply be in line with the expectation. Just because conditions are coming in line with your expectations, it is not a reason to change or forecast. It means the bond market will pressure the yield curve. The better data will tell some Market Participants the fed may sooner than they are communicating. Janet yellen last week spoke she conference and admitted got it wrong when she overlooked vulnerabilities in the Financial System in the mid2000s. She knowledged the weak spots made the home prices even more destabilizing. What are the weak spots . The reach for yield, as she put it. There are a lot of areas of islated asset prices the fed watching. The big argument now is, do they incorporate as another mandate for conducting monetary policy, or do they use tools to head off certain asset bubbles or bubble behavior . That will continue to be something debated within the fed. It appears janet yellen answered the question last week where she said we should use macro prudential tools first. She also did not rule out if those were not working, raising Interest Rates to head off a possible bubbles. We hear on july 15, janet yellen will testify before the central Banking Committee as part of the testimony. I am sure she will have more to say. Last week at pimco said slow rage wage growth outweighs jobs for the fed. Have jobs taken a backseat . If you view it through the eyes of the fed, we had no pickup in wage growth. We have policy tightening cycles and the fed has never gone into a policy tightening cycle when the wage growth has been as stagnant as today. The outlook also matters for the fed. If you continue to get employment reports that are tortured 50,000 plus 250,000 plus jobs a month, they will assume wage growth is coming. The jobs growth means wage growth is probably coming. Because we do not see it yet, that also means we have to temper around the jobs reports until we see the wage growth pickup. And executive director and senior economist at Morgan Stanley joining me in the studio. Good to see you again. Thank you so much. Hillery clinton learned the hall the hard way that politics and money are not always a good mix. Have that story when we continue in just a moment. Breaking news. A federal jury has come back with a verdict in the trial of the former Hedge Fund Manager the verdict will be announced in about seven minutes. Stay with us. We will have details as soon as we get them. Companies have one more week that would let Internet Service providers like comcast and at t and verizon to charge more for fast passes over lines. Where has google been . Megan hughes is in washington with more on that story. Good afternoon. A huge question. Google has been relatively quiet since they voted to move the process forward on may 15. A google owned facebook lobbyists have not visited. There has not been a big push to intervene on this issue. The process is underway and it has attracted a lot of people. Than 600,000 comments. Comedian john oliver ignited a with hisblic outrage commentary. Here are some comments they have gotten so far. One said this is a horrible joke in which everyone is screwed but the internet provider. Another 1 you are certainly seeing fiery comments. Out of the 600,000 plus, no sign of google. It is a shame people are not holding back. What does it say about googles stride dg . We are certainly seeing a passionate approach. It signed out with 140 companies, calling the proposal a great threat to the internet. I was before the fcc voted to keep the process moving forward. Googles spokesman is not commenting the on that letter. A group letter. They may still back the idea of Net Neutrality without wanting to be the face of Net Neutrality. The impact of the proposal warrant that it will be difficult to start up. 60 billion in revenue last year, not as much a financial incentive to necessarily be out front of the fight. Is this unusual for the company . It is. A leader onhas been this in the past. They are not doing that so much. 20062000 10, 2 thousand six, a letter was sent packing open internet rules to bloggers. February 2008, a Conference Call to make comments on legislation. Historically, were not seem at this time. Megan, thank you. It is 26 minutes past the hour. Bloomberg is on the markets. Julie hyman is standing by. Another down day on wall street. Indeed youre the second a lot in a row. Indeed. The second day in a row. 510 pullback, but we have a couple of down days here now. The s p off. Otherlook at a couple of movers as well. United continental shares are reversing course. They saw more than five percent earlier and since then, they have come back. 12 nonhub airports starting in october. More than a 2 billion. Ostcutting initiative the company said it received a notice of default. If lenders are fighting that. Ousted its ceo last month. We will have more on the markets in 30 minutes. Welcome back to the second halfhour of bottomline on bloomberg television. The story we told you about in the last halfhour, manhattan has reached a verdict on the Insider Trading trial of former Hedge Fund ManagerRengan Rajaratnam. To verdict will be scheduled be announced this hour. We will bring that news to you. Let us talk politics now. A panel is recommending Cleveland Ohio to hold the 2016 president ial convention. Rnc is expected to ratify the choice next month. The dnc has not yet fixed theres yet. Political candidates, it seems money is only their friend ,hen it is in their campaign not in their bank accounts. A top issue in the midterm elections, less prosperous candidates are attacking their opponents. More on this strategy, is it mostly democrats adopting this line of attack question mark lacks that is what we are seeing, especially when it comes to the most competitive races. The irony is it is Hillary Clintons recent gaffe that has drawn attention to other candidates in the highprofile races. A republican who has assets in , mostly ind millions complexes run by her husband is being accused of helping the rich and powerful at the expense of voters. In georgia, the former Dollar General ceo was funny much of his Senate Campaign and was accused in his public primary of failing to understand this is an election and not at auction. Perhaps the most highstakes democratte race, crimes is attacking her opponent, Senate Minority leader quadruplingll of his net worth on the back of hardworking kentuckians who cannot afford it. Oh it. Re the wealthiest theyre the wealthiest according to data compiled in bloomberg news. The fact that they are rich and out of touch could make a difference. It worked against mitt romney in 2012. Economic inequality is a take midterm message for them. The strategyut, would be stronger in a president ial election year. You can see a higher vote of a loweration with average income. The out of touch card could really work. They may want to take a different approach in 2000 16 as Hillary Clinton and her 100 million make a run for it. Joining us in washington, yang yang. Thank you. Tonight on charlie rose on bloomberg, a guest talks politics with senator joe manson of West Virginia and congressman cooper of west tennessee. Turn our focus now to indiana university. A simple letter telling his students what their Monthly Payments would be after graduation start a huge decline in borrowing. Federal undergraduate loan disbursements actually dropped 1 million since march 31. With more. Me now the students at indiana university, why do they borrow less . The school, which has about 95,000 undergraduates, decided they want to give students more information. Instead of giving them information when you Enter College or when they leave, they decided to give an annual letter of how much they borrowed so far, what their Interest Rate and Monthly Payment would be in. Raduation they never really thought about how much they borrow in total. Perspective,ot of especially what they will be paying. Nudging, were you just give them information they need and hopefully that will make them make the decisions . It does. Students were surprised at how much interest accrued. It changed their decision. Will put off buying a new cell phone but then i will have to pay interest on that later if i use it for tuition. Talks talk to us about loan counseling . Enter college and most schools do the online counseling. I actually did it and i have to think about a lot of them. It is not so the, especially for a 17yearold, to understand these concepts without really repeating them. It is important to understand capitalized interest. The next kind of loan counseling you get is when you leave. There is not much you get from the office between the time you enter and the time you leave. The more information you have, the government does not require you to leave from a financial visor. A two percent decline nationally in loans for undergrads. What contributed . Deanna, we know was because. Hey borrow less purdue also had more financial literacy. Nationally, you saw enrollment drop. Universities in utah had enrollment drop and part of the reason was because the Mormon Church lowered the age and fewer kids went to school that year. He saw people taking out loans. Lauren joining me in studio. Thank you so much. We will look at a start up that ranks stock analysts winning calls. That is next. Welcome back. The federal jury has found Rengan Rajaratnam not guilty. He was accused of conspiring with his brother to get nonpublic information in 2008 to trade ahead of deals involving Advanced Micro Devices in federal court. Earlier, two fraud counts Rengan Rajaratnam. The first loss for the United States in that case. Technologies reached a deal with attorney general Eric Schneider to limit his surge pricing taxes duringeed to cap prices natural disasters. Yesterday, the service let people order transportation via a smartphone and temporarily cut firms to temporarily new York City Tax services. Its latest start of stock investors protect money. It was founded by a Software Engineer who relied on recommendations he saw online by Financial Experts and some money in the process. The middle east editor spoke with the cofounder and ceo. Nasty whichloped a scans the internet and measures the performance of anyone giving the device using technology such as machine learning. Were basically bringing accountability into the markets and allowing our users to evaluate online, like for market. Urus and even bloggers christ people often say, past performance is no indication of future returns. It is a disclaimer on websites. If were looking at the past performance of these analysts, how do we know the future they will also be any good . Most of them are not good in the past. We can say they will be good in the future. But they have found some consistency. Those that were good are more likely to be good in the future as well. On average, who is better . The highly paid Investment Analyst or people sitting at home in their rooms . If you merge the lists of firstts and bloggers, the that will be ranked highest will be and 56 price place. Some investors were speaking to are saying, Investment Analysts, they can move the market when we put a note out. There are also more trustworthy because we know who they are. Not kind of undermine a little bit the fact that you are incorporating people who could be anybody recommending stocks . Life that is correct. Analyst from Goldman Sachs is more likely to be influential and move the stock a bit. If you measure them in a long years, you never heard the blogger you never heard about the city at home in the middle of the day, there is a better chance he will outperform the market. It is time for todays latin america report. Brazil price information slowed less than expected in june. This boosted the cost of hotels and airline flights. The benchmark index slowed 4 10 of a percent. The administration is holding down regulated prices to cap inflation, eroding Consumer Confidence ahead of elections. Her efforts were not enough to keep Consumer Price increases from reaching the governments target claims for the first time this year. Playing the semifinal for the brazilime this year, against germany starts at 4 00 p. M. New york time. The second final will take place tomorrow with argentina against the netherlands. The winners are squaring off sunday for the championship. Coming up, more when we continue in just a moment. Did you ever think a cow would surpass las vegas by that much . Breaking news, Rengan Rajaratnam found not guilty of conspiracy charges. He was accused of conspiring to gets brother nonpublic information in 2008 to trade ahead of deals involving Advanced Micro Devices. A federal judge earlier dismissed two accounts against him. Escapehe first person to conviction on a u. S. Crackdown on Insider Trading. Joining us, she has been following this story. Thank you for your time today. What happened . Timeosecutors had a hard with the case from the beginning. The judge almost seemed to have it out for them. They suffered a very serious low last week when the judge throughout two primary charges against them. All they were left with was a conspiracy charge, a fairly weak charge. The judge did not seem to think they had enough evidence to sharedoche had information with his brother and that he knew the information was illegal. Not convincely did the judges either. A stunning loss. Onwhen she narrowed the case july 1, was it a signal maybe something was off . A lot of people were thinking at that point something unusual could be happening. Even if the jury found him guilty on the remaining shepiracy fraud charge, could have potentially thrown it out after the fact because she had made it so clear she did not think the prosecutors had enough evidence. A huge loss for them and they pushed ahead anyway. They did the best they could. Of egg onig of their faces at this moment. She rejected throwing out wiretap calls as evidence. She ruled she could present innocent mindset. What is that . One thing they presented to the jury was that he was in brazil at the time the charge was filed against him. The lawyer told the jury that when he heard the news he had his charged, he declared to friends and roommates, i will return to america and fight these charges. That really projected that he felt he was innocent. He came back to the country willingly to fight these charges and apparently, he was successful and he made the right move. Apparently, one of his friends, a gentleman who shared a room with him up until last year, said when he found out about the charges, i am innocent, this is about my brother and not meet. Speaking of names, what does this mean for the u. S. Attorney and his conviction rate . It was never a huge case in terms of the money involved. It was a symbolically important case. They have rolled over the u. S. Attorneys offices in manhattan through the historic Insider Trading backgrounds. Record rogan10 today. It is a very big deal. He was in the courtroom yesterday for the closing arguments. A real sign of how closely he is watching this. Real blemish. At least 80 people have been charged since 2009. 81 have been convicted. Notuld assume this will stop the u. S. Attorneys office from going after these bad actors. That is right. Signal toto send a wall street that they will be watching and cracking down on any behavior they will find. Weak case andas a perhaps they should not even have brought these case the case. You cannot argue with the fact they have had significant successes, including the case against roger. They managed to shut down people doing the wrong thing and send a message that the government is watching. Sheila, thank you. Again reiterating the breaking news, a federal jury here in manhattan finding rengan inaratnam not guilty conspiracy charges. Stay with us. Get the latest headlines streaming on your tablet and bloomberg. Com. That is it for this edition. Thank you for joining us. On the markets is next. I will see you tomorrow. Is 56 past the hour and that means Lord Television is on the markets. Taylor take a look at where stocks are trading. We have an extension of yesterdays decline. A lot of concern being stressed about equity strategist eating vulnerable to a stock rollback. A bloomberg strategist is weighing in on that. Stocks weing cyclical watched fullback earlier in the year. A segment we are seeing out pacing the market this year, commercial real estate. Their shares have stored and their landing to plow 11 billion in new projects this year. That is triple the amount of just two years ago. Joining me for a look at how bloombergforming is interestrates Senior Research analyst. Inare seeing an explosion these being built. Is there enough demand yet to fill that office base . Thank you for having me. I think so. The reason is most of the building is happening in a couple of markets. It is markets like new york and San Francisco where the demand is being driven by technology jobs. San francisco alone, you have Companies LikeBoston Properties, and a lot of what theyre building, it is expanding like crazy in that market. Will continue to see that. The buildings underway are largely policed ahead of time. It mitigates a lot of the risk. What is the risk . Even if there is a demand, or at least a risk of overbuilding, right . There is. That is light landlords are wise to get a lot of the leasing them before the buildings come out of the ground. One of the things we saw in the last cycle in San Francisco especially coming out of the tech boom in the early part of the century was too much construction. A lot of Companies Went under. Rents and occupancys tank. That is the risk. Out to not have enough demand for the space, they could have excess space coming up on the market. I am curious about the timing of this. It is coinciding to some extent with the Residential Real Estate improvement. Is there anything in particular that is really causing this boom . I think what youre seeing is you have got companies with strong Balance Sheets and a need to grow and pricing acquisitions are too expensive. A lot of money has been coming in from overseas, asia, the middle east, canada, coming in and buying up robberies, especially in these markets like new york itself is as go another those markets. So in order to grow, theyre putting shovels into the ground where they can generate returns in their cost in excess of 100 basis points higher than what it would cost in the market. Press we were just looking at shares. Shares of things like Boston Properties and kilroy, which have already outperformed the market. Do you think we will continue to see that performance . There is a real bifurcation in those states. The stocks like you mentioned located in the coastal markets of new york and california are out forming. Those that are located in the suburbs and some of the more central markets are underperforming. That could continue. Thank you so much. Great to talk to you as always. We will have more on the margins a bit later. Street smart is next. The dow, 17,000. We hardly knew you. Will earnings season be the next catalyst for this market . Ill, kicks it off and just about an hour. Street smart starts now. Welcome, everyone, to the most important hour of the session. 60 minutes to go, it is high noon. Seattle is smoking up as the first store to legally