Here is vonnie quinn. Europee opening lower in. Pointing to a higher open in the u. S. Indexanghai composite down more than 1 of the steepest fiveday slide since 1996. It came after Chinas Central Bank cut Interest Rates. Chinese stocks have cut their value since june. European stocks have resumed falling a day after a rally. Germany is done more than 1 . In the u. S. , futures indicate stocks will be higher at the open. The s p 500 is coming off its worst six days in four years. Yesterdays stocks sort of the open, but ended up thing down for the day. The for the open, but ended up down for the day. Jackson wyoming, will fed officials give any hint about the timing of an Interest Rate hike . Mohamed elerian has an opinion. Is certainly reduces the probability significantly and understandably so. If the volatility continues, which it will, then the fed will be very cautious. It will not want to fuel further volatility. In such circumstances, it will most likely weight and not initiate the Interest Rates cycle in september. Vonnie betting the fed will push back the rate hike. Fallen to 26 . Another day, another media feud for donald trump. This time the republican president ial candidate got into it with Univision Jorge ramos. Ramos stood at a press conference and began asking trump about his immigration proposal. Down. Use me, sit you were not called. Said down. Sit down. Sit down. Go ahead. [indiscernible] you have not been called. Go back to univision. [inaudible] sit down, please. You were not called. [inaudible] go. I have the right to ask a question. Excuse me, sit down, youre not called. Sit down. Sit down. Sit down. Go ahead. Later let backas into the press conference. He argued with trump for about five minutes. The pentagon is given oshkosh on the 7 billion contract to build a replacement for the armies hum vee. It would into service 30 years ago. It beat out the maker of the humvee. The pentagon plans to buy the about to buy about 55,000 by 2040. Terrence, if you want kids to make big money, forget tennis lessons, work on their punchline. Forbes is out with a list of the highest paid tv actors and sitcom stars are laughing avoided the bank. Jim parsons of the Big Bang Theory is number one, making 29 million the year. His castmate is second with 27 million. 11 of the top 15 are in, these. Comedies. I think we could rebrand surveillance as a comedy. News, we of breaking will see in the coming quarters, rip up the script dramatically, resources for 14. 8 billion. This is 120,000 employees. This is what youre going to see an oil in the coming months. Week thato this last the financial restructuring of oil must occur. We will rip up the script. David perl with us with epic investments. This is about cash flow. You come down the income statement and bad things happen, doesnt it . The good things are, when you have positive cash flow, there is value. When you are at these low is much,s, the roi much better. The synergy of moving these two companies together is really, really positive right now. When you are the market down, you will see even more m a because theres so many cashrich companies. Inorganic growth from these tom is it enough to support the equity markets when whatever the pop is what is it . Vonnie schlumberger is down. The price is down. Cameron holders will own about 10 of schlumberger. Tom what were looking at is 2016, right . Right. Yet to be a longterm holder. Theres nothing we can predict over the next few weeks or months that will change the valuations. Year torecursor to next see schlumberger and cameron. Lets go to the markets. We begin our coverage of Global Markets and economic worries this wednesday morning. Deutsche bank particularly sharp on china this morning. David perl on cameron. Resources. We will talk to mr. Perle about cash flow. Michael regan with us at Bloomberg News inequities who went back and looked at his noon you have a cathartic bottom, that is not the only bottom. You need to double or triple test as well. What do you assume now after your wonderful call of a few days ago . Looking at the futures, theyre looking pretty strong right now. Same story as yesterday, they were Even Stronger yesterday. Theaded toward the and of session yesterday. Obviously, the biggest focus is William Dudley speaking at 10 00. The speeches are getting to be so important. I feel like theyre going to start breaking into the soap operas to cover them. Tom are you calling as a soap opera . Hold my hand, vonnie. Oh, its terrible, were all going to get divorced. It has a fever. Theres only one cure. Cowbell. Is more you called it yesterday. Vonnie Christopher Walken is here. Tom i cant do it, and virtually. , what is knownte as a retest in the Technical Analyst mexican lexicon. Running a good portion of the global analysis. I look at all of this link to the real economy and real fears about global slowdown. In the last four days, what has changed about the new medium . Normally, through linkages across two countries. One is exports and imports. From that perspective, china is not that important for the u. S. U. S. What about here in the as we go to the jackson all meetings . Deadly today, becomes very important for this has been internalized by the today, becomesly very important for this has been internalized by the members. Recognizing what is happened in the last few days. These beaches often prepared well in advance these speeches are often prepared well in advance. Will there be a sign of desperation or with a rather basically show some stability and say, you know what . Markets go up and down, some people lose and people win, that is what happens. Vonnie i think were going to play a video of what happened in the stock market yesterday where we started out higher. You mention this. We were pretty high all day long, and the turnaround tuesday, if you like. Toward the end of the day, we began to drop and ended up in the red. It is a real hocuspocus day. Tom can i ask, why . Why did yesterday happen . You are on the desk with 20 people. What happened at 2 00 p. M. Whenever you have a big sharp selloff like that, it is greeted by Short Covering in the morning. Then you have to test out where , where is the line in the sand. For now, that 18. 67 level is the line in the sand that held yesterday, but clear the momentum that brought it up in the morning cueie do they take the from europe . Today europe is lower bloomberg surveillance. Today europe is lower. Obviously, this is what volatility looks like. Tom do you have cash to put to work . Are you writing buy tickets on the desk . We are fully invested. The Retail Investors, they make a single call mostly, in or out of the benchmark. They went out and then theyre going to pick up the next three days, so still money to move out and retail. The professionals, we have to decide where to put the money. We have to shift. We dont have that much cash because were not allowed to. Were thinking about whether it should be more cyclical, more defensive, more domestic. Tom can you buy quality blue chips . That is what epic investments is known for. When you look at the valuations of the market, we would from three years of qe were defense stocks got very expensive, so there is real bargains of economically sensitive stocks right now. Tom much more to talk about. Michael, thank you so much. Come back when you get another brilliant crystal ball Michael Regan with bloomberg in the news. Coming up, we will talk with Joe Weisenthal on the volatility. A particularly want to talk to him about what he has been reading since he asked, what did i miss . This is bloomberg surveillance. Stay with us. Good morning. Tom good morning, bloomberg surveillance. Good 1. 2 , up 24 points. Jeff futures up 185. Deal of the day, schlumberger and oil restructuring with cameron resources. A nice 34 , some pop on cameron resources. Much more on that in bloomberg surveillance. Two major servicemembers are killed in afghanistan with afghanistanng uniforms. Her motive is not known. No claim of response ability. It is the socalled third insider attack. By wearingd security afghan uniforms. Dylan thing starting earlier than Christmas Shopping is hyped over the new star wars movie. September 4 is when they will roll out all the toys linked to the film. Awakens. The force the first time, amazon is offering onehour delivery of wine, beer, liquor in the United States. It is limited to seattle for now. Amazon delivers wine and the rest of the country and offers quick of all delivery in london. Alcohol delivery in london. We know where to go. Tom news you can use. Out a noteding thinking was starting with the hokey pokey when he got out. Joe weisenthal has been following every squiggle in every chart this week. He joins us with a crazy first half of the week for the markets. Joe, what stood out to you most in the last three days of trading . I think back to i guess it was mondays action in the currency market. That still seems like some of those charts of dollar yen, dollareuro. One person yesterday in an article saying it was the craziest day. Vonnie the mentality has changed. We saw the euro top 1. 17. For a long time we had gotten used to the idea there was the dollar was the risk of currency. Her long time now, we assume the rally in both, so it is that surprising when we saw the deterioration in stocks people were so bullish on the dollar, so confident the fed was going to be the first out of the gate. When that reversed, all of those positions great, youou do so sit down and you look at what what of is writing and investors does as well. Im noticing the percolation, the ft today about the stability of the Chinese Government. Is that on your radar . Absolutely. The question i think everyone is trying to wrestle with is why does china matter for the u. S. . Torsten had a great idea. Historically, the shanghai composite, just looking at from a stock market respective, it has never been particularly in secret will stop tom do you agree, david pearl, we should ignore it . Is not the chinese stock markets, whether the stock market is exacerbating the slowdown economically and china is the issue. Tom we will talk about this in a bit, but do you agree . No matter what indicator you look at, it is very difficult to establish a strong link between what is happening in china and Significant Impact on u. S. On sentiment, pimples, or Financial Markets. Thatbring the media frenzy we have gone to the last three days. We tried to be adults about it. You did. And we are, but i still think we can get enthusiastic when we see tom its great. One question i have about the china lake we had up link we had up, when china did that small devaluation. That doesnt really matter much. But given how much of a gap there is between china and every other emerging market, currency over the last year that is absolutely crushed, could we see a bunch deeper devaluation at some point and could that be the justification for much bigger market reverberations around the world . Vonnie the other fascinating thing in the last few sessions, the commodities drops we saw. We saw them across the board. It seems like everything fell out of bed. That is the only way to put it. I have seen a lot of notes and people are been trying to go through history and say typically these selloffs last this and maybe global selloffs this many days or 20 , whatever. In times like this, historical markers tom i want to emphasize, we are with the bloomberg Commodity Index near retesting lows. Green on the screen this morning. Folks, this is david, you have been through this 18 times before. Is this normal for cathartic moment or is or some characters different this time . Is a typicalthis correction. The issue is, the world is low. Gdp around the world has been decelerating. Europe is barely out of recession. China, we dont even know how positive gdp is anymore. The u. S. Is the best place to be. Tom are we in global recession . I dont think so. We see commodity cycles normally last 6, 7, 8 years. What is a big difference is the excess capacity. Joe weisenthal, thank you. To forget, coming up, the alix steel show. What did you miss . That will be at 4 00 p. M. Weekdays at 4 00 p. M. On Bloomberg Television. Coming up, one of the most important interviews of this week, charles calomiris, sharp critic of the fed. Charles calomiris of columbia and the Manhattan Institute. Stay with us worldwide, bloomberg surveillance. Tom good morning. This is the roulette wheel of europe. I usually do not show this. On the screen. Even if we see green and the United States, the dax, nice dividend, a little bit of currency risk. The dax challenged, as are many markets in the past coming weeks. Lets get a look at the morning mustread. Vonnie currency is the better performer of europe, it looks like. Ftse done a percent. Morning mustread we have david pearl of epic with us. Owned cameron before the steel, which looks like it is going to go through before this deal, which look like it is going through. Will there be had talked at the top . They will be definitely cutting dividends. We have seen that already. Companies have to remain cash flow positive because this is not the market to run out of money. You cannot borrow, go to market. We are going to see the restructuring that is happening, consolidations like the cameron deal with schlumberger. Vonnie are banks going to force the oil companys to do this at the end of september, beginning of october . Some of them may. Some will get extensions. Will restructure. But it is going to be a tough environment because the stock market has been looking over this. The problem we are having is a natural contrarian, this would be an interesting industry to be a buyer in. It is been a poor performer. The problem is, the asset value of a lot of the Energy Companies is still high. Tom that is where i wanted to go. We saw that yesterday with all of the challenges in australia. There has to be a Balance Sheet adjustment, to say the least. How bad is it right now . Explorationof the and mining companies, this terrible. Roi has been negative. These companies have not even earned their cost of capital over a cycle right now. They are going to restructure. It is really a tough industry to buy, even if you want to find a bargain. Tom this folder to your world and that we dont know where the real rate is, do we, torsten slok . We dont know the cost of money. It is critical for what is going on at the moment. The Central Banks globally push isnt aerest rates and lot of tourists into the equity market. Now people are saying, they are very high. Tom but i dont know what my cost of capital is. In the long run, you dont know what it should be over the longer period. China has more of an excuse saying, hey, valuations are high. Many questions im getting, it doesnt really matter what it is, any vulnerability will make us more vulnerable. Tom david pearl and torsten slok making you smart. How about a twitter question . Us, bloomberg surveillance. Tom it is a Global Challenge this week. Japan gets a rebound, on their delllike average. Some yen conversion. Yen stronger. We have seen that over the last few days. Vonnie five chilean dollar equity market rout in china 5 trillion equity market rout in china. Shanghai composite index fell more than 1 in the session. s extended the deepest license 1996, day after China Central bank had Interest Rates and bank reserve ratios. Chinese stocks have now lost half their values since june. European stocks resumed following a day after a rally. Germany dax is down more than 1 . Stocks will be higher here at the open, s p 500 is coming off its worst six days in four years. Buterday, stocks soared ended up down for the day. Central bankers think of chinas position to cut Interest Rates again . We may learn this later this week. Many will attend the kansas city Federal Reserve annual symposium which takes place in jackson hole, wyoming. There are some responsible central bankers in the world, like in india, that is very low reluctant to cut Interest Rates that basically has currency stability in mind rather than propping up stock prices. Vonnie he also said Central Banks have created a huge systemic risk. The drop joe Biden Movement is picking up steam. Draft joe Biden Movement is picking up steam. It says more than 250,000 people have signed on to the effort. Democratic front runner Hillary Clinton has won her first endorsement from a member of president obamas cabinet. Agriculture secretary tom vilsack praised her for her leadership and her loyalty. A huge deal in the oil services industry. Summers day has agreed to buy houstonbased cameron international. The deal is falla died almost 15 billion valued at almost 15 billion. Cameron makes oil and gas Pressure Control equipment. Summers day is the Worlds LargestOil Field Service provider. Antennas, Serena Williams has been named the top at u. S. Open. Williamsnis, serena has been named the top at u. S. Open. On the mens side, novak djokovic. Those are your top headlines. Tom i walk down Central Park South yesterday and there was a tennis woman having her breakfast in white, has her stack of rackets. Vonnie Bloomberg Radio is there as it is every year. Tom after jackson hole, radio goes to watch tennis. What do you call it . Forests stadium hills stadium . At china with massive volatility and moment by moment specu