Transcripts For BLOOMBERG Bloomberg Surveillance 20240622

World war ii victory parade next week. The u. S. Rally may not last. S p futures indicate u. S. Stocks will open lower today. The s p 500 is coming off its biggest twoday rally since 2009. Oil heading for its biggest weekly game since april. Wti up around 43 a barrel. Yesterday after reports the u. S. Economy grew faster than expected in the second quarter. Puerto rico being drenched by Tropical Storm erika. The storm is moving west after flooding the island of dominica. 4 people were killed and several more are missing. Erika could become a hurricane if it reaches south florida early next week. Thee has confirmed architects of its online radio strategy has quit. Ian rogers joined apple and has led the development of apple beats one. One is ae beats gateway to apples paid subscription. Apple is holding an event in San Francisco september 9. Central bankers have made their annual trek to jackson hole, wyoming. Taking part in the Kansas City Feds annual symposium. Randy greeley is there. How is the hiking . Brendan all i have done is taken a jog. Ive been bumping into famous people on their blackberries. Carney is here. We will talk to James Bullard of the st. Louis Federal Reserve in a little bit. He is not a Voting Member this year. He does have some interesting ideas on how to listen, excuse me, how to tighten policy using more sophisticated instruments than just getting up off of the lower zero bounds. Vonnie checking in with you shortly. We bring the. Bloomberg terminal on the conundrum of the morning. I saw the word conundrum and the ft. Pce core deflator. The nirvana of good inflation, 2 level. Here we are in the crisis below, 20082009. This is a great challenge, the rollover. Mark carney of the bank of england facing the same challenge as vicechairman Stanley Fischer and all of the fed. Lower,check, futures 14. The futures 120. The euro, a little bit of a bid. A little bit of a risk off feel. Oil with a big bounce yesterday churning a little bit of red,. Reen, red, green 50 intraday. Up to the spread between brand and west texas intermediate, five dollars or so. The economies made in wyoming. Reinhart,o carmen James Bullard, and green. Of calm. We are thrilled to bring you from citigroup bill lee, their head of north american economics. Ofning us as mike reagan bloomberg news. Mike do you remember ballad of bob dylan, there is something going on but you do not know what it is. You are left to trade on basically computerized trading programs that do not care about price valuation. Momentum following strategies. This is the case laid out by a strategist at j. P. Morgan. He said it started late last week with what is known as gamma hedging. Tom the accelerations within the market hedging the second derivative. Can we talk counselors on a friday . Can we talk calculus on a friday . Hedging, is that a jargon alert or what . Bill i know your viewers know what it means. Vonnie are you saying people who went to the beach were better off. Mike stay at the beach until you get the all clear to go back in the water signal. It is these gyrations this is a jp morgan strategist saying this, not me, i could have never figured this out. More mason chasers and portfolio momentum chasers and portfolio strategist that target volatility or reposition portfolios based on volatility tom is the strategist that you follow into the week and write for monday . Did that shift because of the week we saw . Or is it steady . Mike as far as the people that deliver year and forecasts for the stock market, none of them have lowered anything yet. We are still looking at a 2230 forecast close for the s p 500. Tom bill lee of citigroup here. Withf my great moments your colleague, he stormed out of the doors, i did not know who was more angry. Citigroup has been the bear on grexit and the turmoil of europe. Ll markets have a tendency to panic first and think later. Colleagues my colleagues are panicking as well, no rate increase is our equivalent of the grexit. I stay with september until we hear from Stanley Fischer. We have a hint from dudley, i think he was misquoted. He was hinting we were going to have some possibility of using. Tom this is a saturday Panel Discussions by vice chairman fisher. Looks to bloomberg. Com and across all the bloomberg digital spaces for headlines and comments on what vicechairman Stanley Fischer says. I believe we got a good gdp number yesterday. Well talk fantastic. Vonnie the First Quarter, what does this bring us to for the year . This confirms that we are solidly at the 2. 5 or 3 growth path. Would you explain why they did not raise three months, six months, 12 months ago . Bill they did not have the data. Since the meeting weve had better retail sales, better pde investment information. All of that said we have a good solid growth. What is missing is inflation, where is the price increase. Vonnie you pointed out early on, we are seeing we are going to get another pce. Tom this is not deflation, this 1 . Is inflation to bill the fed has told us we have to see if inflation gets to 1 in the medium term. Tom i want to go back to mike reagan. How much was black box algorithm trading . This is all different than the typical bogeyman of highfrequency trading. Tom this was not a flash crash. Defineepends how you flash crash. We had bad dislocations in the etf market. There was issues with a Computer System that prices the values of etfs on monday. That caused a lot of question marks to go out in the market. Bill one of the things the programmatic trading days, it matches liquidity. It is phantom liquidity because theres all this flipping that manufactures what appears to be a lot of trading. Mike they are not following fundamentals. Tom thank you. Get some rest. Get five hours of sleep here it mike i will sleep right until monday morning. Tom helping us with the numbers. Very i can green. An extended conversation with James Bullard. Of thet important voice president s and governors. Lets look at our twitter question. You want to hear from fed vice chair Stanley Fischer . Stay with us on this friday, bloomberg surveillance. Tom good morning. Futures pause after a big two days. Dow futures 109. A fragile type. Our top headlines. Vonnie in hungary, three people arrested in the deaths of 71 migrants sound in a truck abandoned on a highway in austria. The migraines probably suffocated. Some of them were refugees fleeing violence in syria. Teslas elon musk is going back to his days at paypal. If you buy a tesla model s after being referred by a current owner, you get a 1000 discount and the owner will get a 1000 credit. Musk had a similar Referral Service at paypal, which he cofounded. Donald trump may have settled the most pressing question of the campaign, is that his real hair . The answer came at a rally in greenville, south carolina. Mr. Trump i do not wear it to upe. It is my hair. Come here, look. It is. Yes, i believe it is. Vonnie trump said the New York Times accused him of wearing a toupe. Vonnie i want to see a certificate. Tom its there. Vonnie one of the things jumping out at me, wti back about 42 a barrel. Brent at 47. 40, seems like we found a bid. Citi calling for we has billy with us. Is oil playing into this . Bill oil and other commodities are holding down the problem we are facing, lack of inflation. We get a hint this is getting embedded into wage setting it could take longer. Vonnie how do we know that . Bill we do not know. There is so much uncertainty in the labor market. The link between labor market increase and price increase has always been weak. So well with your imf experience. Here is morse on oil from his citigroup note. The oversupply is likely to be shortlived in some commodities, especially metals. Crude oil prices are testing new lows. Disinflation and deflation in japan. Deflation peered it is Christine Lagardes new mediocre. Bill one thing the u. S. Has is a rising growth rate and we are expecting the economy to improve. The output gap is supposed to be closing. Potential is only 1. 5 . Tom with policy and looking at the trilemma of politics, Barry Eichengreen with us later, the idea that they will impute inflation and disinflation to our stronger economy, will that occur . And i keep hearing that yet when we look at what is going on, most of the imported inflation is coming from goods prices. Where are the Service Prices . Tom can i do this on a friday . Services, goods. It is that simple. We care aboute do inflation . Where the services are, that is the core set of non traded goods and services the fed is going to be worried about. Vonnie why isnt the oil getting passed on . Quality of Income Growth has dropped. Most of the Income Growth is coming from lowwage sectors. Tom hes like 02 on jargon alert. Marginal propensity to consume is the responsiveness of consumers to an Oil Price Drop . Bill to increasing income, increasing income is from Lower Oil Prices. Tom why didnt they spend it at walmart . Bill theyve gotten cautious. Consumers are more cautious today because of the uncertainty in job growth and the type of income. Tom how can that be . Vonnie Corporate America is not passing on bill without a doubt, gas prices are lower. Au can argue the spreads are little higher. The difference between gasoline prices and oil prices. And a lot of that is because refineries has had outages. A Technical Glitch has held up prices. Tom bill lee with citigroup this morning. We will continue this discussion. We have two first red economists to give you perspective. Will join usreen from the university of californiaberkeley. The worlds Great International economist. He had the privilege. Then a conversation with James Bullard of the st. Louis fed, the great centrist. On the st. Louis cardinals as well. Michael mckee and Brendan Greeley in jackson hole. Good morning. Tom it will not make the headlines in america. It is a big deal, yen at 1 10. 84. Of bloombergka tokyo reporting there is no inflation and japan. This is a big deal for asia. Outright deflation again in japan. Our morning must read. Vonnie kit juckes from socgen talking about the top macro topic of the month, the chinese fx regime shift here he says the objective remains a puzzle given the shift was followed by a tightly managed float. He goes on to say the u. S. Dollar will ultimately do well in a macro environment of declining global reserves. Bill lee of citi with us. How much was the yuan depreciation related to the selloff . Bill the listening was the Exchange Rate was an attempt to be imf friendly. It was not for macro purposes. What we conclude is the regime is trying to find its way to find a liberalization scheme it wants to continue. And they did a devaluation they have done days of depreciation and they are within thell a collar, strength to the bottom and weakness to the top of dollarrenminbi. Bottom. To the which way will they break out of that . The consensus is they must depreciate . Bill they want to widen the collar so they can show everyone tom they are not. They have an open mouth policy that says that. They are too afraid to allow the markets to have full force. They do not have the Financial Institutions to be able to withstand tom if they let the currency go, what happens to capital flight within china . Bill thats the big fear, where will the capital go . There is no confidence that the regime in place is able to manage the liberalization and social policy change they have to do in the next few years. The people are trying to find other places to put their money until confidence comes back and that is going to be a while. Vonnie you talk about open mouth policy, we dont know what they are going to do next even regarding the renminbi. Bill say as much as you can to encourage something, but not show what your plans are. Vonnie are they going to devalue further . They it is without a doubt want to because they want to encourage the economy to grow, but that is the wrong way. They are trying to shift resources and push capital into the service sector. Article thistant week showed the separateness of their janet yellen from beijing. , hownot buy that independent are there monetary makers . By our standards they are well controlled. But they are a market economy. They have controlled economy tools and a market economy infrastructure, thats a conflict. They do not have the policy levers they need. They need fiscal policy, how can they implement fiscal policy when their Corruption Campaign has gotten rid of a lot of leaders and frozen government spending. Vonnie what is growth like in china . Bel we think it is going to a growth recession. We may see some quarters with a three handle. Tom a three handle is a recession by their description. Bill especially given to her history, which is a doubledigit growth rate. The actualinced that numbers would be much worse. Tom great perspective. Our goal this friday is to look at the week and get you ready for the weekend. From jackson hole, coming up here to a harvard professor carmen reinhart, this time is different. A conversation at 7 30 eastern, James Bullard will join us. Tom bloomberg surveillance. 126 p 16, dow futures are a quiet morning compared to this week. Vonnie chinese stocks ended a volatile week with a strong finish, they rallied for a second day. The shanghai composite up almost 5 tiered speculation authorities are propping up president fore chinas takes the stage at a world war ii victory parade next week. Rally may not last. S p 500 futures indicate u. S. Stocks will open lower today. The s p is coming off its since twooday rally thousand nine. Former president george w. Bush visits the site of one of the low point of his presidency, he traveled to new orleans to mark the 10th in verse three of hurricane katrina. The former president was criticized for his response to disaster. President obama wasnt there yesterday, he walked through the neighborhood hardest hit. The president said new orleans is a model for resilience in the face of catastrophe. President obama on the larger project of a better, stronger, the just new orleans, progress you have made is remarkable. Vonnie mr. Obama called new. Rleans a work in progress defense secretary Ashton Carter and frienddraising raising mission to Silicon Valley. Techr wants to recruit firms such as apple and google to join defense contractors. Skepticaludience is of the pentagon, where he of privacy violations. We will speak with Ashton Carter at 1 00 p. M. Eastern on bloomberg tv. It is a milestone for facebook, Mark Zuckerberg says on monday, one billion people used the social network for the first time in a single day. One out of seven people on earth. In january, the company said that 20 of the worlds population is on facebook. One of the legendary figures in pro basketball has died, Darryl Dawkins was the First High School player to go to the nba directly. Seasons. 14 he became known for his backboard shattering dunk and was nicknamed chocolate thunder. Dawkins was 58, he died of a heart attack. Tom nobody thought he would have a long career. Boy did he deliver. Vonnie 611. Tom they thought he would be a flameout. Vonnie all the names for all the different shots. Coverageeed to begin from jackson hole. Brendan greeley and Michael Mckee are in wyoming. They have coffee at this ungodly hour. Brendan good morning. We spoke yesterday to carmen , she is known for her work with Kenneth Rogoff looking at the history of financial crises. Work sayingy, her countries should be worried about debt to gdp ratios greater than 90 . Reputationven her a as a champion of austerity. That is not necessarily true pitch she thinks countrys should be creative with nonausterity ways to get rid of debt. Michael a couple years ago she told me here that the u. S. Was going to come out of this slowly. That is what her work showed, it might be several years before the u. S. Returned to normal. Now she says we are getting the Great Recession past but that does not mean we are going to be returning to a prerecession economy. Reinhart if you look at periods, after world war ii everybody had high debt, real Interest Rates were very low for extended periods. For the past few years i have been saying i think expecting the economy to return to those were, 3 real rates, which not exceptional prior to the crisis, i think that is not the world we are going to be living in for some time. She sounds gloomy but there is good news. She told us that the United States is ahead of the rest of the world in recovery. Brendan we talked about greece and germany. She does not have any confidence there will be a nominal haircut there. Is necessary to pass an actual haircut and not just extend maturities, a pretend haircut. If you reduce the amount owed, some good things would happen. This is what she said about greece. Inhart if you are a citizen of that country and your money is outside of the country, that is the situation in greece. There is a lot of greek wealth outside the country. T if you think there if you think there is this debt burden in the out years, that probably means that some form of Tax Liability or confiscation is not unheard of. If those risks lie ahead of you, is that in inducement for you to invest in your own country . Michael we talked about greece for a while, extending and pretending is not doing a good job here at actual haircuts need to happen. Look at the challenges in jackson hole and i go to the history that Michael Mckee knows. There is a lot of shirts this year at jackson hole. Eve heard of the protests give us the nature of the protests and how they have disrupted the meetings . Good news is they have not disrupted the meetings. They have been very present but. Ery polite it is a little confusing. They want to be able to keep the fed on hold, they do not want the fed to raise Interest Rates too far too fast. The fed says they are not going to. The case they are making is not clear. Bill i spoke to brad Delong Delong i spoke to brad yesterday. They are worried that Economic Policy tends to create affect minority communities. Then they go to the fed for relief because congress is not working. You could askf the fed to do one thing other than keep the federal funds rate at a zero bounds, what would it be . Brad i would like to see more focus on the unbanked in america today. Especially if you drive down, at the relatively new reserve bank in kansas city and drive south. You find yourself passing ,heckcashing shop checkcashing shops, car loan shop, payday loan shop. Something like a quarter of the population of kansas city really does not have cheap and reliable access to the banking system. This is a meeting of central bankers and also a presence of the Federal Reserve. Oft to me goes to the heart what the Federal Reserve bank can do outside of voting on the federal funds rate. Tom James Bullard coming up and a moment. Bill lee of citigroup with us. Protesters at jackson hole, how unusual . Explain why brad delong and Joseph Stiglitz being there is important. Bill these are the figureheads of economic thinking. Them to support something which i think is a nonissue. They are worried Interest Rates is going to go up and hurt the poor. That will not be an issue until five years from now when we get back to a more normalized Interest Rate policy. The fed has promised we will be at below normal rates for a long time. Three years to five years. These are important, smart individuals do they have representation among any of the governors, any of the president s or vicechairman and chair . On the think everyone fomc is concerned and passionate about wanting to have better yellensar that in speeches. Bill janet yellen is probably at the center of the circle that says we have to spread the recovery to everyone. That means to have a Strong Enough recovery that everyone gets good jobs and not just a gig. Thank you to the Kansas City Fed for allowing protesters to be there. Its cool to see brad delong and joe stiglitz arguing as others speak at jackson hole. Our twitter question this morning touches on the vice chair Stanley Fischers Panel Comments saturday. What do you want to hear from the vice chair . Thank you for your tweets. Hat is at bsurveillance we are with bill lee of citigroup. Tom are we . We look at, the Dow Jones Industrial average, we were at 18,000. Life is coming to an end, 16,000, 654. Two days in a row, up. A little red. That is where we are given a of markets. K single best chart on economics, this is the pulse of america and gross real inflationadjusted gdp. That lee of citigroup with us. Place chair Stanley Fischer with the ultra accommodative phrase, a 2. 7 average economy including two ugly drawdowns. Bill despite the fact that down, weve had 2. 5 3 growth rate in the data. No question we should move. Tom why are we not raising . What are we waiting for . And we are panicking first thinking later. Im concerned janet yellen is going to develop a reputation of being pushed around by the markets. 2. 5 3 is great. Why should we move . Wildcard, whathe is causing the inflation rate to be so low. I think it is because of the transitory factors vonnie what would make you say janet yellen is pushed around by the markets when the data is not stellar. Think under 3 growth at 1. 6 vonnie it is adequate. 2. 7 is really good relative to other nations. Bill and when you say the benchmark is 1. 5 and we are at 2. 7 , we are coming along nicely. Why cant they raise rates and say we are not going to do a measured approach . We are going to raise rates and observe. Just hit on my prescription. Raise rates now and see the rocket reaction. Vonnie we have not seen inflation janet yellen said you do not wait until you see inflation, you look at the forecast and you have confidence youre going to get there. 17, 18, 19, do you start to see a two handle. With 2. 7 percent growth rate, you got to be more confident. Vonnie there is talk that we may get one move and then qe4. Bill you can also see snow in july but the likelihood is low. Tom with brad delong at jackson hole and joe stiglitz, state the case where paul krugman says we need stimulus given we need 3. 7 to gdp. Reshapingeed stimulus the composition of the gdp. We need more and construction or an investment spending. What we do not need is more inventory and a lot of wasted Government Services that are just not tom so good to have you. Trying to get you ready for the weekend. Lets look back right now at some top photos. A groupnumber three is in london sponsored by the Royal Photographic Society that distributed disposable cameras to homeless people. By the end of july, 80 cameras were returned with more than 2. 5 thousand pictures taken. The public was asked to pick 13 to be compiled into a calendar. The goal was to help people affected by homelessness be empowered through connections tom why does black and white work so well . Vonnie they are very emotional. Bill very effective. Top photos, British Marine engineer has created a personal submarine. The submarine retails for 1. 5 million. It is built like a quad copter drone. The submarine joystick is used a lever. We putin in front down there in crimea. How much is this . Vonnie only 1. 5 million. Tom we should look at it. Vonnie number one photograph, a photo of former u. S. President overlooking new orleans after katrinas destruction. He is going to be there and he has come out and said it was a mistake to do a flyover. Was. What ms it what a mess it was. We get back to the economics. This friday am looking forward to tomorrows Panel Discussion with Stanley Fischer. What do you want to hear from fed device chair . Markets risk off, futures 14. From our World Headquarters in new york, it is Bloomberg Bloomberg surveillance. Tom we welcome you worldwide and across the nation. James bullard of the st. Louis fed. Every time he speaks, he makes news. With Michael Mckee and Brendan Greeley from jackson hole in our next hour. Top headlines. Vonnie officials investigating the on air murders of two journalists say the suspect bought his hand guns illegally. Hundreds of mourners gathered outside the Virginia Station where the reporter and photographer worked. They were killed by a former colleague vester flanagan. He killed himself with the same gun used in the shooting. Walmart getting an early start on the holidays. The retailer begins its holiday Layaway Program today. Customers will have 90 days to pay versus 60 days a year ago. Giving customers a sneak peek at its toilet chosen by kids playlist chosen by kids. A bad day at the office for the top ranked player jordan spieth. Hes nine shots behind the leader. There are just days where it all falls apart. Im usually shooting at 25 over par or 30 over par. Vonnie on a 36 handicap . Tom tom, why dont you go have a drink . See you at the 19th hole. Vonnie george w. Bush is visiting new orleans, following president obama yesterday. A joins us from 20 miles outside of new orleans in the louisiana. What can we expect to hear from the former president , clearly sorry he had those photographs taken. David he must be. Note are plenty of people eager to defend george w. Bush. There are those who said he did come down here and make promises. Hes going to go to mississippi tomorrow. Tomorrow, president clinton is going to come to new orleans and will accompany Mitch Landrieu through ceremonies marking the anniversary. Vonnie do people want to see all the president s and former president s . Are they happy to see them or do they want them to go away . I was outside the Community Center where president obama spoke yesterday. It was amazing how early people lined up to see him kids, adults and senior citizens. Even while he was speaking when the sun was at its hottest, people were outside the venue. There did seem to be a earnest to see eagerness to see him at least. Engineersre all civil 10 years ago with broken levees. What has happened to the laws that protect new orleans from the gulf of mexico . Are they truly better right now . Here on the front lines of this big debate over coastal protection. The status committed to spending 50 billion over 50 years. Where im standing is a stones throw from the great wall, a 20 foot tall t. People on the other side had a reasonable amount of protection. Here on this side, they do not. The home behind me was washed hurricane rita came through. Plenty of people have sat down with commuter models and look at what land is disappearing. Of people whoty say as a result they had been forgot. Want to go to the question i said yesterday as you prepared us for the president s comments. Are the stereotypes of new orleans drifting away . What is the new new orleans . David you hear Mitch Landrieu talking about the need for a new influx of transparency in new orleans. Governor jindal is saying the hope is that was the that will spread through louisiana as well. Since hurricane katrina, people are working very actively to set aside old stereotypes and make this seem like a competitive place like new york and San Francisco that have cultural components. It is an attractive place to bring a company. Tom thank you from new orleans. Final comments with bill lee of citigroup. We know that all economics is local. There is an oil patch to the west of new orleans. How much is midland, texas, how much is that going to bring us down as oil implodes . Bill that has been underestimated. We have underestimated how much disruption oil has. We will findwe know that all ecs local. Out employment numbers next friday. Employment numbers are going to show us how well the economy is doing. Tom do you have a call . Bill we think it is going to be slightly weaker, august 10 to come in week and get revised upward. We have a number of 190,000. Do not panic when you see that. Tom thank you so much. A friday. Have you on how about a four x report . We could have done a one hour four x report . Dollarrenminbi, stronger yuan, stronger australian. Swiss franc gives it up through the week. U. S. Dollar weaker through the week. Another hour, including a conversation with james lord of the st. Louis fed. Stay with us. Tom in these eight days of august, a fix from 14 to 41. We look back on a tomorrow to us week. We look forward to janet he isdecision to not a jackson hole. An extended conversation with James Bullard of the st. Louis fed. Good morning this is bloomberg surveillance, live from our World Headquarters in new york. I am tom keene. Joining me is vonnie quinn and Brendan Greeley and jackson hole with protesters. Vonnie the protest began last year. They have Joseph Stiglitz. Tom i do not care what honorablypolitics is, vonnie saying this is not a recovery. Tom some of the color from jackson hole, we will have much more through the hour. Lets get to our top headlines. Vonnie stocks in china rallying for a second straight date making investors. China resumed yesterday. Chinas leaders want things to look good for a Major Military ceremony next week, the state agency that prop that share prices says direct stock purchases will probably end in a month or two. The u. S. Rally may be running out of steam as s p features are having a lower open, coming up its biggest rally in six years. Oil is headed for its biggest weekly gain since april, the west texas intermediate up again , crude prices rose 10 yesterday after u. S. Secondquarter gdp figures were revised upward. Where do ringo is drenched with rain this morning by Tropical Storm erika puerto rico is drenched with rain this morning by Tropical Storm erika. Or people were killed and several more are missing. She could become a hurricane if she reaches south florida by early next week. Apple confirms the departure of ian rogers who led the radio. He joined apple when it bought beets music last year. Apple is expected to unveil its latest model iphone september 9 in San Francisco. It is summertime for central bankers, summer cap, the policy makers in jackson hole, wyoming for the Kansas City Fed annual symposium. When the greeley is there. However the china market turmoil permeated the discussion behind closed doors . Brendan the one thing you always hear is, we are data dependent but what data . The biggest event has been not just the market turmoil but the possibility of the slowdown in growth. We talked to barry i can green about this yesterday. He is a very well respected economic historian out of uc berkeley. He said we do not know how that it is in terms of the economic slowdown. What that will affect is the commodity producing emerging markets that sell to china, not as much as an issue for the u. S. Janet yellen is only supposed to Pay Attention to what is going on in the u. S. What is going on in jackson hole, i am about to go fishing. Vonnie we will check back in with you later. Tom let me do a data check. Call two big days, i will it a risk off, futures negative, dow teachers negative 158 and the euro stronger and the dollar is weaker. Avoid oil gives up after a buoyant date yesterday. Economist meet in wyoming after a most unusual week. Wednesday and thursday they brought a rebound. A modicum of colalm. After days and nights through the Bloomberg Markets team. If you were talking to or three weeks about this week, what would be the summary of what you observed. Volatility everyone predicted 2015 would be a volatility year and it was not for a long time and we caught up. Tom i was parsing with Joe Weisenthal the difference between a tantrum and a hissy fit, and outrage, what was this . A tantrum, the average retail investor, this rate hike is a big bogeyman that is scaring people. We will see Mutual Fund Outflows in equities and bonds for two straight months, july and august and that has not happened since 2008. Tom retail fear is here. Theie we have to remember index back down to 26 having been about 41, nowhere near where we got to during the financial crisis. I think lehman when he got volatileobviously very as far as the price swings, he picks vonnie a much bigger even for emerging markets. Tom you see that among the currency fluctuation, the peso doing a little better in the last 48 hours. Thank you so much. Us andccadonna is with has given us terrific perspective on economics. We need to go back to my conversation with the vice chair, he will speak tomorrow in jackson hole, he spoke to bloomberg surveillance a week ago, here is dan fisher. Are not alone, the behavior of the british economy is similar to that of ours in terms of inflation and unemployment. There are fewer and fewer growing decently. Tom there is Stanley Fischer linking us to the bank of england. They blinked a week ago, 10 days ago, will this fed blink at jackson hole and on through the rest of the year . It is interesting revisiting that conversation with you had him in light of the july. Policymakers are satisfied that they have met the labor mandate portion of the dual mandate that feeling there is a lot of uncertainty about the inflation mandate which puts all of this weakens discussion in much sharper focus. Wen vice chair fisher says see only a couple of economies growing in a healthy pace, that certainly brings doubt over that turnaround time to the inflation. Tom one of our advantages is carl publishing in his 14 hour day research, you did a brilliant note last night on poor disinflation ahead for the United States. No one believes you. Isthe core inflation outlook about a tale of three cities. We have rents which are a hotspot. Plungings that are because of the strength in the dollar and that will only intensify as we see the dollar continuing against all of these currencies. Gas will get cheaper. Carl gasoline, he a lot of economists say gas is excluded from core inflation so ignore it, and that is technically true but gas goes into all of the things that are part of the core, so gasoline has an important leading quality over core inflation in the get in gas prices is telling us that core inflation will not trend higher in the near term. Vonnie we will just begin with william about this, does it take september off the table . Carl i dont think it is off the table just yet. If we see the volatility continuing up to the september meeting, i think there is an option that economists are not considering right now that is october comes into play. Vonnie mike of j. P. Morgan chase mentioned that. Carl they could come out in september and say we need a little bit more time and we will have a president roberts after the october meetings and suddenly october is in play in the fed has the luxury of looking at more information which vonnie they said every meeting is a live meeting saying anything can happen. Tom the markets have to react to this. Michael regan, to bring it back to you, what a week it has been, where are we a month from now . Everybody gets back to wednesday after labor day or september 10 or september 15, find, then what for the markets . Michael the big question is when will the fundamentals take back over . Tom the profit making machine that is america. Michael the trading going on this week was a lot of computerized trading signals off of each other, strategies that do not have anything to do with economic fundamentals, they are taking signals on the volatility and from the momentum in the market, and eventually the Value Investors come back in and maybe we will see a rebound. Tom the advantages of bloomberg do you, over carl, this weekend, revalidate the new mediocre that the u. S. Is doing better and a lot of other countries are flat on their backs . Carl absolutely come a goes back to a Stanley Fischer highlighted, the u. S. Economy is going it alone and it is a largely insulated economy. Exports are only 12 of gdp. They are our feedback mechanisms. As we look back at janet yellen, we have to consider who is hawkish and who is dovish at the fed and if we look at the rotation of voters it becomes more hawkish next year. You have Esther George of James Bullard, but coming Voting Members. If she waits until next year to start she will have an angry hawks waiting to take a bite. Tom why do i care what jim bullard says if he is not a voter . Carl because he will be a voter next year. Tom what is your name again . Michael regan, true ethical terrific duty. We hope you stay with us on economics. Our Michael Mckee and Brendan Greeley with James Bullard of the st. Louis fed coming up in about 19 minutes. Stay with us worldwide. Tom what am i thinking about into the weekend dollar mexico, the mexican peso come a shot and all in mexico city from peso 15 we had a 17 print weakness, 16. 92 this morning, i would suggest this is a big deal, the adjacency of mexico to america. A morning mustread from dr. Elerian writing for bloomberg to. He suggesting there is a complexity to our economics. For the last few years central bankers in much of the advanced world have acted to repress volatility, as a way to boost asset prices. The feds ideal would be an orderly and a measured increase in the market. Us record on up carl with and this is the greenspan measured path. Arthur burns did not do that 25 years ago . This is an original greenspan. Carl very different environment and janet yellen has moved away from that promise of a steady, gradual pace. A number of her press conferences she said do not expect that steady drumbeat like we saw. Tom this is critical not only when we get the parlor games september, october, december, but a vector of it when smart guys like carl say back to they are looking at that light path. Vonnie stressing the fed isarl currently telling you about 100 basis point of tightening next year, 125 per year thereafter, that is not going to happen, this will be a much slower pace. That is why janet yellen will be able to get away with raising rates despite all of this noise, they can raise rates, say one and done for 2015 at a much slower pace thereafter. If you pull that off you do not get the dollar ripping it has in past cycles. What do you make of the data we are seeing at the moment . We were seeing good data and it became a very mixed. And it is now difficult to say what is going on. Carl the gdp numbers look good and Consumer Confidence numbers look good andy durable goods look good and we are seeing the type of data that should justify the fed lifting off it was not or these events lifting off the Financial Markets. Tom carl with us with a bloomberg intelligence. Coming up we will go to jackson hole and Brendan Greeley, in about 14, 15 minutes, our conversation with James Bullard of the st. Louis fed, the great neutral president from indiana university, at jackson hole. Stay with us, with futures at 18 and dow futures 150, this is bloomberg surveillance. Tom where are we on this friday . 1. 99 for a couple of couple copy early this week. Of risk feel. We say good morning. Focus, butonomic first our top headlines. Vonnie officials invest getting the on air murders of those two tv journalists say the suspect bought his handguns legally, hundreds of mourners into a vigil last night at the Virginia Station or the reporter and photographer work. Only say they were killed by a former colleague, Officials Say he killed himself with the same gun used in the shootings. Elon musk goes back to his paypal days to come up with an incentive offer at tesla, anyone getsoston by a model s that referred by current owner gets a 1000 discount. Usk had a similar planet paypal. Donald trump is still forming his policy ideas but one issue is that his real hair or a today, the answer came yesterday during a rally. Oupe, it is wear a t my real hair. Come on. Yes. I believe it is. I do not know. This is so screwed up. No discouragement of mr. Drop by what we are focusing on, carl does not need to do this. Excuse me, we are on radio, for those in radio we send a photo of me pulling on my toupe. You are lucky you are on radio. Good morning, boston. Vonnie the topic of the china, jackson hole, should have tunnel they moved bailey, Brendan Greeley and Michael Mckee had an extended conversation with the berkeley professor talking about privilege and the future on the monetary system. Aboutid i can green the cause of the turmoil. I was thinking back to his more recent book where he talks about the Great Depression and what it teaches us. We asked him, what is the best historical comparison to what is happening right now in china with the possibility of a slowdown of the economy that buys everything from everyone. He said 1929. Whether the chinese was because of this instability may be debatable but he told us that the way they did it was wrong. Have communicated more clearly what the purpose of the policy is and what the intent of the policy makers was. China did a mini devalue asian, 2 many evaluation. It is potentially destabilizing because people think the first 3 could be followed by the next 3 and a third 3 and that it is serious business. They did not explain what the endgame is and explain what the motivation was and that is what got them into trouble. He says the chinese should come out and give us a better explanation of what they are thinking and where they are trying to go. Brendan i was fascinated to hear him talking about the craft of central banking, something that mark carney has been paying attention to and janet yellen as well, not what you do that how you say it and how you explain it. I asked him if we rely too much on Monetary Policy to get things done when we should look to parliaments and congress to fix things. He took me by surprise and said banks, including a particularly the bank of japan is not doing enough. Belief thathe Central Banks, if they put their minds to it, the bank of japan, if it puts its mind to it leads to it needs to and canst do more and can do more. People reluctant to do more because they are worried about the implications for the Central Banks Balance Sheet, i think Central Banks need to put those Balance Sheet considerations on hold. Andtheir inflation targets then a deal with the consequences for their own finances. Brendan that really caught my attention, he is telling the bank of japan keep going, load up the Balance Sheet, we are not there yet. Tom thank you. Carl with us of bloomberg green,gence, barry i can on europe and he has been talking about the strong dollar here and we have another strong dollar. It is a strong dollar is it fear . Ing we could carl absolutely, if we look at the trade weighted dollar, it is running at levels last seen and placed 1990s when the gdp growth rate was about double what it is. Trade matters, the cost of a u. S. Worker matters, corporate profits generated a broad matter, all of those things impacted by the strength of the dollar and was china devaluing the currency it intensifies and we are saying japan needs to do more because japan has to stay ahead of china. Made a michael very point that there should be more tunneling from china and that this will happen and maybe more will happen. Is it working in the u. S. . Itl no central bank admits is devaluing the currency or everyone screams bloody murky just bloody murder. Thing, same thing japan and china. He has wonderful books. Coming up, a conversation with jim bullard. Get excited for the 1989 world tour with exclusive behind the scenes footage, all of taylor swifts music videos, interviews, and more. Xfinity is the destination for all things taylor swift. Tom good morning. Brendan greeley in jackson hole with Michael Mckee. Bonnie quinn has our top headlines. Vonnie china stocks and a roller coaster week with another rally, the shanghai composite rose for a second straight day, market watchers think the government is propping up share prices to make things look good military ceremony. S p futures are pointing to a lower open today. George w. Bush report a low point of his presidency traveling to new orleans for the 10th anniversary of hurricane katrina. He was severely criticized for his administrations response to the disaster. President obama toward a new orleans neighborhood that was wrecked by the storm. He said new orleans is a model of resilience. Of a better,ma stronger, more just new orleans. The progress you have made is remarkable. Called the obama recovery work in progress and said the goal is not to rebuild the city as it was. Ashton carter is in Silicon Valley as a recruiting miss you, he wants apple and google to join the fight against International Hackers but many in the Tech Community are wary of excessive surveillance and privacy violations. We will talk with Ashton Carter, you can see it this afternoon at 1 00 p. M. Eastern right here on bloomberg tv. Facebook is a milestone come on monday one billion people use the social network, one person in seven worldwide, the company says 1 5 of the global population is on facebook. One of the legendary takers in pro basketball has died, Darryl Dawkins was the First High School player to go directly to the nba, playing 14 season and becoming known as chocolate thunder. The first player to enter the nba straight from high school and was 58 years old. Tom thank you. There are 12 fed president s, there is only one James Bullard, a phd from indiana university, arguably the most controversial fed speaker as a centrist between hawks and doves. Jim bullard moves markets, now for an extended live conversation in jackson hole, here is Michael Mckee and Brendan Greeley. Brendan. Brendan thank you, tom. There is a lot to start with. Whichgo first to china seems to because in a lot of the market volatility we have seen. Mr. President , you said i thought that was a low bar. Brendan over the course of the summer, are you worried about low chinese growth exporting deflation to the u. S. . Growththe story of china has been around for a long time, i am hearing from ceos who do business in china that it looks lower than the official numbers. Still, i think that has been priced in the markets for a long time. It is not that big of a surprise. Brendan what about inflation in the u. S. Will we see over inflation because of prices lowering in china . James that effect is not that big because our economy is day, we have a lot of other things going on other than trade to china. There will be a little effect but not that big. On the shanghai composite, the shanghai composite in the first part of 2014, for six months come around numbers, trading at about 2000, by june 20 june 2015 it is trading at 5000, now at 3000. Up,thing went way, way probably beyond anything anybody could rationalize. Now it has crashed down and is still up a lot yearoveryear. I am not quite sure we should be putting quite as much weight on the shanghai composite as we have been. Mike you are in favor of raising rates. Now we have the market volatility with fed officials said they like. And 2013 the taper chat room, the fed held off on moving because they said financial conditions have titans tightened. The you have pause about a move in the near future . James Financial Stress index is it is a volatile. Time. U. S. Fund metals look good. Labor markets look good. Strong reports on the economy, secondquarter gdp revised up to 3. 7 . A good second half of the year coming. I think the u. S. Outlook still looks very good and the key question for the committee is how much would you want to change the outlook based on the volatility we have seen over the last 10 days . I think the answer will be not very much, because we have lower Interest Rates in the u. S. , longerterm Interest Rates than we otherwise would have, Lower Oil Prices, those are usually bullish factors. On the downside, you might have higher volatility and credit spreads and a stronger dollar. Those roughly watch out and so you had the same trajectory that the committee will be looking at that we were looking at before. Why would we change strategy which was basically left off at some point based on this volatility. Mike if you do move in september september, what give confidence to the markets . James it will be a good day when we make the move and it will signal confidence in the u. S. Market and let me remind everybody we are talking about a miniscule move off of zero and of committee has a strategy lets get going on this process, but be very gradual and share yellen has been hammering this point, lets be data dependent and gradual and we will work our way up slowly depending on how the economy performs going forward. Brendan what is your alarm bell level of core pc, what are the whites of their eyes . James inflation has been heavily affected by oil prices and they are down. Generally speaking that is very good for the u. S. Economy, we are a big oil consumer. It does affect our Inflation Numbers and somehow you need to look through the oil price decrease, one way to do it is to look at the dallas fed dream pc inflation rate, has been solid year over year, 1. 6 , in that area. As labor markets continued to improve, that will go back up to 2 . We are ok on the inflation front. Brendan do you have a level to say we have to move now, 2 , one voice and 120 . 1. 8 . Are all the way down zero, so you have to think about how this will play out over the next two to three years and we have already mapped a course of the low Interest Rates, so those that want low Interest Rates, you will get them over the next two years because we have met a slow mapped a slow normalization process. Mike is there a difference between the way inflation is being generated this time such that we will not see a rapid acceleration in inflation, particularly with Commodity Prices and oil prices where they are . James the committee is organized around the phillips curve and i have not been a big advocate of the phillips curve. You have to recognize that that is a lot of monetary Monetary Policy. We have unemployment down at what most people would estimate as the natural rate, getting good jobs report, no reason to think otherwise going forward. Unemployment will come down into before present range of the forecast horizon. Under conventional models, that will put upward pressure on inflation. I have not been a big advocate of this but a lot of people on the committee are a big advocate. Mike when will we start seeing it . James we have inflation coming up over the next year, by the end of 2016 we will be at 2 . Countries havep had trouble getting that 2 target, can we assume a physics will work the way it always has and we will get to 2 . James it has been a low inflation era but the bet is supply and demand will reassert itself. Markets do seem to be tightening somewhat, but we are not seeing it reflected in wages. Has something fundamentally changed . James they are a liking into quarters say you cannot look at wages as a way to predict inflation. And wages will improve we need better productivity in the u. S. And productivity has been low. If you think of a simple model of wages it has been productivity, growth, plus inflation. That overn equal to the last four or five years but the productivity growth component has been so low that wage growth has not been great. Mike what has happened there . James i wish i knew, we need better productivity, that is the single thing that would improve the u. S. Economy the most. You remember the late 1990s where we had a productivity boom , excellent for the u. S. Economy. If we could get that going it would be excellent. One of the problems is that after the crisis, we naturally wanted to reregulate the u. S. Economy because you naturally felt a lot of things went wrong and we had to change the rules and that reregulation process slows down productivity growth. Brendan when you talk about productivity growth, does it give you pause that the traditional relationship tween the business cycle, the mirror image of productivity growth is broken down, does that say the models we use in the past are not appropriate now . James measurement is a huge issue for productivity and just like in the 1990s, you have new technology coming online, social ponderables, how much is twitter contributing to productivity . I do not know, it seems like it is but i am not sure if it is showing up in the data. If you talk to somebody from google, he will give a story about all this productivity all over the place but it is not measured. I think that remains a puzzle and a good area for research. Mike are you concerned about data in general, you look 7 10 contraction in First Quarter was the initial print and now we have growth much faster in the First Quarter. James the first half looks pretty good and that is something i was waiting for confirmation. We told the story about the First Quarter that that was transitory, it looked negative at one point and is now positive. We have a 3. 7 number four secondquarter growth, that puts us at the first half at over 2 . The second half will be better it looks like. I think we are in good shape and i do not think this volatility we will see how it shakes out. A good shake out in a different way that i am describing but i do not think it will affect the basic trajectory of the u. S. That much. Tom i wanted to jump in, jim bullard, the reason i am not in i couldhole is because not go if the Pittsburgh Pirates were in first place, the cardinals doing better than good. I want to go back to the phillips curve, another generation out of the London School economics, you were out of the real world of indiana university. If Stanley Fischer and janet yellen are on a phillips curve model, what model would you suggest for the chair and the vice chair . James as you know, i put a lot of emphasis on inflation expectations. You look at the measured they are down, they have been down maybe 40 basis points on average across the different yields. That does give me pause. I think it is a concern but a lot of that is driven by oil prices, they are highly correlated with oil prices and they should not be. People on then, committee, including me, put some emphasis on survey measures which have been more stable. As long as we have these anchored expectations we will be ok. I do find the tips declines a bit concerning. Brendan we have talked a lot andt the need to tighten move away from the current policy, but you have been talking about different methods for doing that, not just about the federal funds rate, about what is paid on excess reserves, what are tools the fed could consider as they look at policy next year . James we have a clear plan. It will be interest on excess reserves at the top of the range, reverse read at the bottom of the range. I think a 25 aces point range. We expect the fed funds to trade in between the three rates will move up and that will work fine. We do need to see that once we get started. Brendan over the last year, banks have been removing their excess reserves, about 200 billion leaving the fed, does that say that will be a less effective tool in the future . James that amount is not a big number. It is funny to say 200 billion is not a big number but it is not. We will have to use this method as long as we have super abundant reserves and that is the way it will be but i do think it will work. Repo well you cap reverse about and if so how much . A lot of people are worried you will become the repo market, private sectors will dry up and everybody will take their money out of the money funds and banks and put it at the fed. James i think around the time of liftoff we will not put any cap on it cause we want to see what happens later on, we would make a decision. And try to limit the size. Where we will come down i do not know. Bullard of the st. Louis fed, thank you very much. Tom mike mckee and Brendan Greeley, thank you so much with jim bullard. That was extra ordinary, carl, very critically, you go to the october meeting, december, september, a meeting in the middle and you want something different. Asl we cant ignore october a real possibility. It did not sound like bullard needed to see much feedback from the financial. Tom he is with jacob frankel. Tol the new york fed wants move slower and wants to see what the implications are of these recent Financial Market developments. Vonnie he set the impact of Lower Oil Prices and Interest Rates washed out the impact of higher credit spreads and volatility, but if we did not get the volatility than what would we have been left with . Was it a serious argument . Carl he was talking about financial conditions although he dismissed the recent tightening and financial conditions but that is what you would expect from a hawkish member of the fed, the other folks on the other end of the spectrum where janet yellen lies are more focused on the market doing the heavy lifting for the fed and if you see this vonnie is he getting more hawkish . Carl i do not think so but he is always been on the hawkish end of the spectrum. Tom our twitter question today looking forward to tomorrow and Stanley Fischer. Tweet us at bsurveillance. Tom good morning everyone. We are thrilled you are with us on a friday, what a weekend has been. We will talk economics with carl riccadonna. Right now top headlines. Vonnie authorities arrest three people in connection with the deaths of 71 migrants, the bodies were found in an abandoned truck near vienna. Smugglers are exporting migrants trying to reach your up after pleading syria and other mobile trouble spots. August,ristmas in walmart launching its Layaway Program, customers have 90 days to pay and you have to spend 50 to use it. People celebrate a four over par round but that is bad for jordan spieth, his worst score since may to start the barclays tournament in new jersey, nine shots behind the leader. I cannot believe he is not have a four over par ray round since may. Mistakes. Or tom i do not know what the fed will do, maybe 18 over par in the coming months. We just heard from james fuller and we now need to hear from carl riccadonna. I go to Deutsche Bank and pickup dominic think of dominique, they fold in all of the moving parts into one decision by the fed. I refuse to believe this is the fed working in a vacuum. Carl it is not the fed in a vacuum and i have not read his notes recently but they are over the view that the fed will move later and are very concerned about the tightening of financial conditions. Tom a lot of people think jacob frankel, former governor of the bank of israel, says what are you waiting for. The later crew versus the september crew, miles apart. Whats theare saying rush, we have negative feedback mechanisms coming into the economy and very little inflation. Very few signs of a inflation in the great compromise which was alluded to by president bullard is just to do a little bit, a one and done fed in 2015. The plot suggest that as we thought in june, two rate increases this year, i do not think that will happen. The compromise ground between the janet yellen and bill dudley and the more hawkish camp is just go once and signal a much slower postlude. Tom what is the harm of going one and done . You use the word trajectory, explain to our audience, on radio and television, why the specter or trajectory is so important . Carl as soon as the fed starts to move towards tightening and evelyn is the first rate increase the markets tend to wait to overreact and expect a much faster pace of tightening that what ultimately transpires. That is the danger for the fed if they move month if they moved, everybody thinks they will move a lot so the postliftoff trajectory, the pace of tightening after the first move is what matters and is what janet yellen emphasizes. That is what matters. The only way the fed can get off of the zero balance is that they can prevent the market from having this dramatic repricing of expectations which would lead to a significant tightening of financial conditions. Vonnie we were speaking to one economists, they are still into september caps on. Impact ofabout the the china turmoil on the fed, what about if the fed moves, if the fed decides we will not worry about international markets, we are worried about the domestic economy, what about the impact on china . Carl if the fed moves carelessly and does not successfully telegraphed the one and done method you will see a dramatic tightening in the dollar strengthening of the dollar and tightening of financial conditions and in a sense that is a good news for all of these other Central Banks trying to we get there currency. Tom we have jim bullard out there, it is a friday after a hellish week ending markets. I want you to explain to our global audience the fixation on suits and ties over september, october, december, all they want to know is do i have a job and will i see a wage increase it is not there. In that are moving direction, but what matters more than that one or two rate increases is the broader affect in the Financial Markets. If the fed going 25 basis points means you get a big lola in the markets like we saw this week then you might not have a job. Tom is there proof that if they go one and done, we are doing this to get off the zero bound, any indication the markets would blow up . Carl if they can convince the markets it is one and done. Tom janet yellen looks at her microphone and says we will just do one and done. Carl if she can convince the markets that is the truth. Vonnie has she convinced the markets much . Tom i want to insist we get this in with Stanley Fischer talking tomorrow, bullard took a shot at the phillips curve and the economics. We studied that and know it. Explain to our audience where Stanley Fischers new model is, if the phillips curve model is broken. Carl the phillips curve represents the relationship between the level of on appointment and the level of inflation and it has flattened, which means you can get inflation lower excuse me, get the employment rate lower without causing the same flareup in inflation pressures and that is because we have a globalized economy. Tom i am with bullard. They are piling it on, the richmond fed twitting out that they will speak against further delay next week. The Central Banks tom we have to go to twitter answers because we got a huge response. Vonnie we asked what you want to hear from the fed vice chair speaking at 12 25 eastern tomorrow in jackson hole, wyoming. We cannot let the stock market control our decision, we have to rely on data. Pretty sure the second answer what i want to hear the present time to raise rates is after a market value adjustment. Tom we just got that. Features 15 right now. Vonnie the last answer, thanks everybody, the Federal Reserve is to be unwound and closed or i resign and mr. Tom keene can take my seat. Not know whether to order Chicken Salad or Grilled Cheese for lunch. These people are sharks thats sharp sharp. Stanleyif that is what fischer says it will be tom keene who wrote that speech. Time for our agenda, lets go back to jackson hole where Brendan Greeley is standing by. Brendan if tom keene is the head of the Federal Reserve i worry about the path of volatility in the future. I have two agendas, one, after the cameras turned off we were talking to James Bullard of the st. Louis fed, you just treated that exhaustively in the show, but he said the committee does not like to move when there is volatility. That might be a clue to watch, iftility moving forward markets are still uncertain as to what their plan is, the fed might be uncertain. My other agenda, the head of the reserve bank of india, i will be talking to him along with mike mckee later on today, india is a Strange Island in a sea of volatility. Their gdp numbers, they have asked for an era growth and not as exposed to china as a lot of other developing economies. Vonnie we are looking forward to hearing the conversation. Be safe with all the moose and bear. My agenda is the data, we have ece him a core pc and i will be interesting. I know you will be watching. Carl i will be watching the second print on university of Michigan Consumer sentiment. A comprehensive accounting, but anyill gently reflect feedback into u. S. Households from stock market swings. Michigan extend the survey time, one of the first times for the fed and dudley says he will be watching this report. Agenda is a migration to Silicon Valley, the secretary of defense, ash carter come a dialogue with our Technology Types on where we are going with information. This is not a small item. A big deal and it signals may be a new pentagon and even more important, maybe Silicon Valley that wants to join the dialogue in washington dday in washington today. Off the radar but quite important. What a week it has been. Vonnie every single week has been amazing. Tom i remember early june going what will we do for the summer. Vonnie we had the u. S. Open next week. Carl and the jobs report. Tom we will do that next friday, much more to talk about. Futures 15, dow futures at 126, surveillance continues on radio, Market Makers next on bloomberg television. Good morning. Matt good morning. What a week we had. This is Market Makers. I am matt miller. Erik schatzker and stephanie will off. And Stephanie Ruhle are off. Reassessing the markets in the week of volatile trading. Many are waiting to hear commentary from central bankers where they are convening. Moments ago, we heard from jim bullard who said the last 10 days should not change the feds outlook. We are bringing new and incredible lineup of guest. We will hear from marty feldstein, the fed president the feds president s of minneapolis and bls president erica groshong. Groshen and we will be asking when they will raise rates and what to expect. Time for the top stories this rn