Rise, but it is not going to rise by very much. This is a phenomenal asset and the return on those instruments could be quite spectacular. Vonnie is the economic glass half empty or half full . There is lot more growth than a lot of the skeptics think there is. I do not think there is today that wence have broken out of the 2 world. Vonnie it is all straight ahead on bloomberg best. Hello and welcome. I am vonnie quinn. This is bloomberg best, your weekly review of the most important Business News, analysis and interviews from Bloomberg Television around the world. Lets start with a day by day look at the top headlines. The week began with a fresh batch of Economic Data from china. The chinese secondquarter gdp data shows the worlds secondlargest economy growing at the brisk rate of 6. 9 . Definitely a beat. All the numbers beat. Gdp was better than expected. 6. 9 , we were expecting 6. 8 . The consensus estimate of a survey by bloomberg. Also, factories are pumping out goods at a faster clip. Industrial production at 7. 6 , that was more than a full percentage point more than the previous month and a full percentage point more than the estimate. Then we have retail sales much better than expected. 11 . We were expecting 10. 6 . Also, fixed asset of an investment just inching above the estimates. This economy even though the authorities are trying to curb excessive debt and over leveraging, they are seeing still Strong Production and strong growth. Overall, i think all numbers suggest the economy has stabilized, led by strong fiscal policy. The heightened Monetary Policy conditions have not affected the real economy much. Vonnie disappointing Quarterly Results from Goldman Sachs and bank of america. Trading fell 40 , making it the worst first half in that area of ceo Lloyd Blankfeins term. Bank of americas interest declined, failing to deliver a boost following the fed rate hike. Overall, trading coming in line, i think it was a little worse but equity is better. There is a little bit of tradeoff. Banking fees are also better. There were some bright spots in the quarter. On the other side, the cost ratio is the lowest cost rate ratio in the first half for the public history of goldman. That shows that they are doing what they can in terms of managing costs in this tougher environment. Bank of america is very tied to longterm rates. So any time that you see the 10 year not doing what we think it should be doing and picking up, that is bad for bank of america. What really sticks out is Net Interest Income for that bank, which is core revenue for any bank, especially for bank of america. That is something that fell despite these productions from Brian Moynihan two months in the quarter saying we will have at least 35 million to 50 million increasing and they actually saw a decline of 100 million. Vonnie after two more republican senators announced their opposition to the Republican Health bill proposed by the gop leadership, not only is Senate Majority leaders Mitch Mcconnells effort to pass that dad, but it looks like repeal and replace is a no go. President trump i am not going to own it. I will tell you, the republicans are not going to own it. We will let obamacare fail and the democrats will come to us. They will say, how do we fix it . This bill that failed miserably, lets go through the ticktock. Last night, you had senators coming out and saying they are against it. The bill failed. Then you have the Senate Majority leader backed by President Trump himself saying lets revote to repeal this. Less than 24 hours later, you have senators like Susan Collins saying we do not even want to have a vote to proceed. I can tell you discussions are already underway to find a new path forward but they will be relying on a very narrow path forward. Julie Morgan Stanley has reason to celebrate. For the second straight quarter, the bond traders posted more fixed income revenue than its larger rival, Goldman Sachs. It also reported the smallest drop among the top five u. S. Investment banks. How did Morgan Stanley manage to do better than goldman once again . Laura one of the things we were highlighting in the stories we were writing was the commodities sector. This is something Morgan Stanley has largely gotten out of. Interestingly enough, Goldman Sachs did not exactly say we had a terrible loss in commodities. Julie they said it was the worst quarter ever for commodities. Laura maybe not a lot, but certainly bad. Julie but not good. Laura so that could be one of the things. One other item that Morgan Stanley did talk about in terms of fixed income was they had the rates, they are not good for them. But fx is something that did offset that. The bank of japan. As expected, they took no steps to downgrade their aggressive monetary stimulus program, even as the other Central Banks around the world are looking for an exit. Anna the central bank acknowledged it was the being too optimistic with 2 inflation target. They cut the date for when they will hit the fiscal 2 target to around april 2019 which is pushing it a year. They kept in place there their quantitative easing, their relative control. There are a number of risks. One is the consumption hike scheduled in 2019, that is bad timing. It would be best if the government delays the consumption tax rate again. Another thing that is much bigger, what is much more important is the risk of the ability of Prime Minister abe. We are seeing the plummeting of the Prime Ministers approval. If he goes, there goes our support for bank of japan. Without the strong vacuum of the government, i think the bank may start to feel it cannot maintain the current aggressive stance. That is the biggest risk. Jonathan anticipation for autumn bills. The Statement Reads if the outlook looks less favorable or if financial conditions become inconsistent in part of inflation, the council stands ready to increase the program in terms of size and duration. Then came the news conference. The words from draghi themselves could be taken hawkish. The financial position is the last thing the ecb wants. The may 2013 taper tantrum still haunts central bankers. The backpedaling from the meeting was very visible. This is a very delicately worded structure. Even prepared to tell us what he meant by autumn when he said mnere was an all done autu date and he would give us further guidance on and sit. Nevertheless, tiptoe he will. There is quite a lot of uncertainty looking around and i do not discount another taper tantrum moment. Vonnie bloomberg has learned Robert Mueller, the special counsel investigating Donald Trumps campaign is examining a broad range of transactions involving the president s businesses and some of his associates. Give us the details we know for certain. We do know that special counsel bob mueller is looking at a lot of transactions that involved not President Trump, but developer brand name trump going back at least a decade or further. Anything involving russian money going into trump apartments, certain individual developments like trump soho, the 2013 Miss Universe pageant in moscow and the sale of a Luxury Property in palm beach almost 10 years ago. The Legal Authority that bob mueller has, that was given to him by rod rosenstein, the acting attorney general, is very broad. The language says words to the effect of matters around the Russian Campaign collusion question and any other matter. I think Robert Mueller has decided these other matters are very much part of his purview. Robert mueller was fbi director for a long time. I would call him a prosecutors prosecutor. He will go to where it have to facts takee the him, even if it is unpleasant. I dont think he will hesitate to bring down the hammer on donald trump, donald trump jr. , any of the people caught up in the crosshairs. I think he views his mission to get to the bottom of this wherever that leads. That is what we know about Robert Mueller. Vonnie a staffing shakeup at the white house. White House Press Secretary sean spicer announced his resignation after President Donald Trump hired financier Anthony Scaramucci as his communications director. Lets get more now with bloombergs chief washington correspondent kevin cirilli. Kevin a clear shakeup in the Communications Department of the west wing. Something that has emerged as the most combative against the media and one of the most visible. I have spoken to several sources in and out of the white house over the past few weeks that have said the president has grown frustrated with sean spicer. Sean will continue to serve the administration through august. The president has appointed Anthony Scaramucci as communications director. I dont have any friction with sean. I do not have any friction. This is the white house of the United States of america and we are serving the president. I want to make sure that our cultural template is to make sure to put the president s agenda first and we serve his interest. We have a little bit of friction inside the white house as a result of that, we can all live with that. Im used to dealing with friction. Vonnie still ahead, as we review the week, Neil Atkinson of the iea predicts oil prices will keep rising. Plus, barry diller has no love for President Trump, but likes what he sees in the u. S. Economy. We will also have a thorough roundup of the weeks earnings report. Up next, more of the weeks top business headlines. Nelsons health is getting ready for a proxy fight with Procter Gamble. It is not a breakup. It is not a ceo change. It is very much acceleration of the plan. Vonnie this is bloomberg. Vonnie this is bloomberg best. I am vonnie quinn. Lets continue our global tour of the weeks top business stories on wall street. Where a legendary buyout firm is set to deal with the future without its founders. Kkr has taken a big step in succession planning. The private equity firm has elevated two veteran executives in their 40s to the new role to copresident and cochief operating officers. It is all in an effort to prepare the firm for the future when the cofounders are no longer at the helm. They founded the firm back in 1976 and have run it since. They started it with their mentor Jerry Kohlberg who left the firm in the 1980s, but this has been their shop. People wondered once they got into their 70s, both 73, who was in line to take over. This answers the big question , not just for the public investors, public shareholders, but also the institutional investors, pension firms and endowments that give billions of dollars to kkr every year. The British BroadcastCompany Confirming this morning a new itv ceo. It seeks a successor and start a new position in january 8. There were rumors she wanted to go into politics. Why did she land at itv . It does seem like a slightly strange move to go from aviation to broadcasting. In her case it is slightly less odd because that is where she comes from originally. She worked for the guardian. Susan advertising executive. She is an advertising executive. Shes probably at a point in her career where she would like to try something new again, to some degree, something old. They are trying to reinvent themselves into production, less on the advertising. The question is does she still have that touch . Does she still understand that industry having spent seven years away . The ceo of the oil company has resigned, citing health reasons. He steps down amid this ongoing battle with the shareholder elliott. He will be replaced by the former head of the specialties Chemicals Division. Barclays says it is second fiddle to what is happening with the elliott story. Do these resignations open the door for what is happening . That is the question because they walked away on june 1. It has six months that it can come back with a new offer. The successor is currently the head of the Chemicals Division. It is all about the market is zo can move when ak up to the Chemicals Division. How can the attention be retained if the head of the Chemicals Division is now leading the company . David what looks to be the biggest proxy fight in history, trion has nominated its founder nelson peltz to the board of Procter Gamble. Procter gamble has a market cap of over 200 billion. They have underperformed their peers because of their insular culture. They have been talking with Procter Gamble for some time. Why did they decide to move . In july, there was a meeting where they presented their ideas for how this company could turn around and be a little faster and more responsive to the market changes. They suggested at that meeting that nelson peltz get a seat at the board and the companys directors decided that was not the avenue they wanted to go because they already had a plan in place for righting the ship. David is this a restructuring situation . Often, activists say, lets break it up. Scott it is not a breakup and not a ceo change. It is very much acceleration of the plan. Peltz does not believe that will have any impact whatsoever unless they have somebody there guiding it and pushing it through. A country moving to reduce Financial Risks and stimulate growth, some banks have lowered the rates they offered on Wealth Management products. The Wealth Management product part of this particular push is important because they are essential cog in the China Banking industry. On the one hand, they are quite popular for retail space, looking for higher yield. They have been averaging 4. 6 in recent months. That is much higher than you can get in other products. Retail is happy to funnel their money. The banks like that because they are an alternative source of funding, they are cheaper than the cost of funding in the money markets. The reason regulators are worried, they are saying if you are paying yields that high, there is a risk you might pass on those higher costs to customers and the economy and hurt the real economy. Regulators are trying to put a squeeze on the Wealth Management products, telling these banks to put down the yields for the customers to make it more affordable, less pressure in their funding race. Its generally part of this wider crackdown of containing risk. Francine the german carmaker daimler is recalling 3 million mercedesbenz diesel vehicles in europe in an effort to head off a crisis in the potential of emissions cheating. The company could avoid massive penalties. What led to this recall . It has been bubbling along in some sense ever since the volkswagen crisis broke nearly two years ago. They have been very adamant that they have not cheated like volkswagen did, but they may have pushed the boundaries in terms of what regulations allow in turning off emissions controls to protect the engine. The boundary for those criteria is pretty loose. So what they are trying to do is at least come good with the German Government and saying, ok, we are going to get out ahead of this thing. We are going to basically recall every single modern mercedes out on the road right now in europe. Car, 220e 70 euros per million euros. If this fixes the problem for them, they get away pretty cheaply. Trade talks in washington between the u. S. And china have gotten off to a rocky start after news conferences were called off after wilbur ross criticized beijing for their trade imbalance. It is time to rebalance our trade and investment relationship in a more fair, equitable and reciprocal manner. We were kind of managing expectations going into this dialogue, but it feels it is more acrimonious than expected. Michael the Opening Statement was. The rhetoric was sharp. The chinese vice premier also warning the United States not to bring geopolitics into it because any kind of sanctions would torpedo the talks. Maybe a direct reference to the steel sanctions the president has threatened. No specific agreements were expected at this meeting but what the hope was, that they could continue meeting, they could create an action plan of one year of negotiations to follow the 100day negotiations that came out of maralago. We have no idea if they got that far, neither side talking yet. Deutsche bank Ceo John Cryan telling employees to prepare for a hard brexit in a videotaped message. Cryan said there is a lot of detail to be ironed out and agreed depending on what the rules and regulations turn out to be. We will try to minimize disruption for our cl