All right, a lot of news to kick off with. That the week that investors will focus on. Not a lot of Economic Data in the u. S. This week to drive markets. Everything from washington to , listening to what janet yellen has to say about Interest Rate hikes going forward. Lot of focus on Balance Sheet reduction, but also a recognition among fed and the and president s fed chief herself that inflation will remain low going forward. We continue to watch fed fund futures. Is what we are seeing when it comes to a possible rate hike for december. It has come down a bit from the fed minutes last week. The topic will be Financial Stability in wyoming. Any thing from janet yellen that could send a hawkish signal. Mario draghi more than janet yellen, reports that he is not planning any surprises, but he may talk down the euro. He has had a tough time with a lower dollar. That is complicating matters. A reminder for viewers on how markets closed friday, another day of jitters, but not as much. When Robert Lighthizer when gary cohn was reported to leave, the markets went down, so setting up for a softer opening in asia. I thought it was interesting given the price action on friday that we saw for the first time the s p fall 1 thursday. On friday, if followed with a decline. We havent seen that Movement Since brexit last june. Here is how we are trading for new zealand so far. Slow going in the red, down point 20 the dollar weakening against most currencies, g10 currencies, with the exception of the swissie and the kiwi. Australia, fortescue earnings coming out any minute. We also are seeing wti holding on to gains after 3 jump on friday on u. S. Shale explores reducing rigs. Futures pretty flat for the open in sydney as well. Nikkei futures, upside 55 points after that dramatic selloff of on the nikkei 225 friday, down more than 1 , dollaryen seeing a little bit of a temporary weakness for yen. Lets get the first word news. Spanish police say they are no closer to finding the suspected terrorist leader behind last weeks attack in barcelona. They have the names of the members of the group that planned a bigger outrage, but say three people remain unaccounted for. To pack three trucks with explosives and blow them up in barcelona. More of will lay out its brexit position, hoping to persuade brussels to move away from divorce talks on to future relationship. Range ofoverage a issues including Data Protection and judicial cooperation. The eu must be convinced that progress has been made on exit bill,rights, the and the border with ireland. The show support against conservative critics in india and increasingly confrontational United States, rouhani one another term on promises to press ahead to and isolation impose the economy and will achieve more by being united. The u. S. And south korea begin new wargames monday in an operation denounced by the north as reckless saber rattling that could lead to war and follows weeks of heightened tensions to attack athreat qualm, drawing an aggressive response from President Trump. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. A dramatic week for President Trump, the firing of steve bannon on friday, so does his smooth sailingmos for the white house . Can this administration get back on track right now . Is this an Inflection Point for the Trump Administration . Definitely. If you want to know who has not sent a single tweet today, that would be President Trump. Adont know if that means change in policy, but may be interesting to think about. He has an important speech scheduled for monday night about the afghanistan policy going ahead. With the departure of steve bannon, maybe things are starting to stabilize in what has in an extremely tumultuous white house. Aret has been the we tracking developments out of north korea as well. You think steve tannins the parch or makes relations with pyongyang tougher now . He said there was little chance of a war. I am cautiously optimistic that there are other people among the generals and diplomats who dont want to go there in terms of a Nuclear Conflagration with north korea. Most see a diplomatic solution is the best way, and it does seem like in the past few days that things have settled down a little bit, so i dont think steve bannon was the only one at the white house who want that nuclear war was a bad idea. Thats true. Ok, but what about President Trumps Approval Ratings which have slumped to under 40 in key midwestern states . Talkingbelieve we are about this, but that could have implications for the midterm elections, right . The extent to on which he can get his legislative agenda across and how members of forown party start to plan 2018. Than very unpopular, less 40 approval, and mr. Again, pennsylvania, wisconsin, three key states. The democratsike to take the house in 2018. One thing they are down on is President Trumps handling of international affairs, but they are more positive about his handling of the economy, so it is not all terrible news for trump in those states, but it shows that it will be a tough few months ahead to establish stability in the white house and make sure that there is no revolving door of personnel. One thing we heard today was of Ohio Governor john kasich saying it is hard to have a winning team when personnel keep changing, so it seems like the administration is in a hole and trying to climb out of it. Ofindeed, a merrygoround people there. Thank you on what has happened over the weekend and the week we just had. Ford inut moving washington . Ed conners is a visiting scholar at the American Enterprise institute and former adviser to mitt romney and thinks that Steve Bannons departure might s price forry cohn staying. Ronald bowldent was last week. There are two factions. I would not be surprised that that was the price for staying. They were going to exert their influence and that would be a time to do it, but in the case the odds on, he is favorite to be the fed chairman after janet yellen. He has a strong incentive tuesday. Lastly, if you look at liberals and conservatives, youre in for a chastising rebuke. The difference between the liberals and conservatives is they can chastise the president and leave him less effective, where as the conservatives are trying to push their agenda forward and they have to take in an effective president and make him as effective as can be, so walking out the door does not advance the conservative agenda. They have to find a way to make it work. He sees so many people quit the white house, so when will he quit the white house . I dont think that is happening. The lesson donald trump teaches is you never quit, never give up, have to be in it to win it. The chatter in washington is rising as we see more and more people leave the white house. On line betting as been of the third that he does not get to the end of 2018. I would take that bet that he will be here at the end of 2018, but he is under pressure and has not assembled the legal team he needs to counter the investigation against him. He probably needs to put some attention on that as well. The problem is the conservative agenda is going nowhere while he is focused on this. Trump equaling to Arnold Schwarzenegger 2. 0 with Steve Bannons excellent . Is this a way to reset the administration and get some execution on Economic Policy . I think steve bannon had a powerful insight that one the president the election. That trade and trade deficits and low skilled emigration put pressure on wages. Aen you have to convince couple of hundred thousand voters to be elected president in the midwest most affected by that trends, so i suspect the philosophy of steve bannon, that portion of the philosophy, probably continues ford and is an integral part i suspect of the white house economic policies. We have seen the power and the influence that john kelly has had since he has taken the role of chief of staff after the departure of other administration officials, are there more on the chopping block . Some of those guys were rumored not to be team players, and we saw that in the public eye of them not inc. Team players. It is clear that kelly is demanding they be team players. I know someone who says the white house is run differently than it has in the past. Tightu have it run on a schedule and you get your oneonone meeting with the president , a brief time that kelly is there monitoring the conversations, asking some questions and moving to the next meeting. It seems like the way the white house is being run seems as though it has changed from what i have heard. It certainly has. Stay with us. We will have more in the next block. Ed conard joining us from the American Enterprise institute. In this hour, we talk about the yen with bank of america. Safe haven in as a storm of geopolitical risks . That is in just half an hour from now. This is bloomberg. Tokyo, cloudy in and counting down to the first major opens. , dollaryenhe green seeing upside, so a potential pause in the strength of the yen given geopolitical tensions. Sell down the u. S. , mexico, and canon that ending the first round of talks on nafta, committed to wrap up quickly with a comprehensive deal. Ith us is ed conard you have long argued that we are looking at this trade deficit in negotiations the wrong way, right . There are two issues. First, no serious economist things trade deficits are tied to the terms of trade. I think the traditional view is as investment heats up, it poll savings from the rest of the world. That is what causes trade deficits. As long as you spend it, you dont lose employment. Moneyst 20 years, the more has been pouring in and Interest Rates have been falling, an indication of saving rates pushing its way into the United States. If that money sits unused, workers dont get hired. There is no serious economist who believes this, but trade negotiators do themselves, so how do we get to a working agreement on nafta . Ultimately if we did not have large trade deficits with mexico, running trade deficits with the rest of the world, i dont think people would be nearly as alarmed if every job that went to mexico came back to the united dates in terms of demand from mexico for u. S. Goods and u. S. Employment, so one of the proposals i make is we should issue a dollar of import for every dollar of completely divorcing negotiations. It would be difficult, but we have trade with lowwage economies like mexico to be competitive in the long run. Developing negotiating terms of trade that make sense, but if we use those terms to balance the trade deficit, it would lead to a bad situation. Speaking about job killers come to the other view from the white house is immigration is a jobs killer in the u. S. You wrote a recent oped that said we should rethink this. If you look at the u. S. Economy, there is 120 million fulltime employees, 6 million top 5 employed, innovation is driving growth, so we doubled the number and double the growth rate. In the future, we are eaten alive by do you agree with the view that immigration is netnet a jobs killer . I believe the constraint to growth is talent in the United States. If you spread the talent over more low skilled workers come you get lower productivity growth and they will end up with lower wages as a result. The answer is to you agree with cutting the in a gets to the answer different way. I agree with the conclusion, but not the economics. My own view would be that by increasing the high skilled immigration, we can change the ratio of high skill to low skill and that will drive up the lay of the low skilled employed. If you have an unlimited supply of low skilled labor, it would be hard for anybody to get a pay raise. You get big employment increases, which is what we see. Do you know anybody listening to this . Anybody have an opening in the White House Administration . I think he is thoughtful and is interesting and listening to it and gave my book a careful read, but he comes from a if youional view, but look at that, what are we using the money for . Up huge fiscal deficits, financing subprime mortgages, money sitting unused at 0 Interest Rate since the financial crisis, fueling greek consumption, so if you look at our business it is cash flow positive and it is hard to make the argument that they are constrained with savings here at with savings. You talked about china and these trade investigations the u. S. Has triggered on china when it comes to intellectual 301 iny, using section trade diplomacy. Do you think that will be an effective way to get china on board here in terms of what the u. S. Is demanding . Know, china is stealing a lot of the intellectual property. The more effective answer would have been to use tpp to develop trade relationships with countries that are more likely to be aligned with us instead of rivals and more willing to respect our intellectual property and intellectual property laws and push the trade to those countries and away from countries like china who dont respect intellectual property laws because it is to their advantage not to and are growing very harmful rivals to the United States in the future so we try to use the terms of reduced trade deficits from asia. It is a big mistake and we missed a big opportunity to develop an alliance of Asian Countries more aligned with United States than with china. Is china likely to retaliate and trigger a trade war . More from them than they buy from us, so im not worried about retaliation, but we might end up buying less goods from china and by higher cost goods and consumers will pay the price. They will certainly pay the price in the short run in that it will not have any affect on protecting intellectual property because it is to the chinese advantage to steal that intellectual property and they will continue doing what they are doing because it is in their best interest to do it, so we need a different approach. I gave you an approach to make an improvement to the situation. What do you think of gary cohn as future fed chairman, good . A thoughtful guy because he got to the head of goldman sachs, so you have to have a lot of confidence in that sense, but it is unclear what his Monetary Policy is. His public announcements have been all over the map and difficult to read. Maybe you will like that in a fed chair. I dont think the economics knows what position he is taken. Thank you for stopping by. Visiting scholar at the American Enterprise institute, add conard. You get a wrapup that story and more in todays edition of daybreak. Bloomberg subscribers go to dayb on their terminal and the mobile anywhere app where you can customize your settings to get the news on industries and assets you care about. This is bloomberg. A quick check of the business flash headlines. Nearing a deal to acquire texas power provider encore for 9. 3 , out flanking Elliott Management and Berkshire Hathaway. Encore is a division of bankrupt Energy Future holdings. Terminating sale talks with kkr and infinity Equity Partners after they were unable to offer terms acceptable. The company says its optimistic outlook is an important factor in the decision. That delivering a return to sustainable organic growth following the year of transitions. Jeffrey immelt could be the front runner to be the next ceo of uber. A vote of directors in support of an appointment is likely to happen in the next two weeks. Two other executives are still being considered. Wall street watching jackson hole, but are we getting signals of policy changes . A look at the week ahead, next. Beautiful monday morning outside the Victoria Harbour this morning in hong kong. 7 30 a. M. , a few moments from the first major market open in asia. Betty a gorgeous day in new york, 7 30 p. M. Sunday evening in new york. Friday, markets closed lower but a little bit of optimism you might say after the news came out steve bannon was out. I am betty liu in new york. Yvonne i am yvonne man in hong kong. You are watching daybreak asia. First word news with haslinda amin. Haslinda canada, mexico, and the u. S. Want an ambitious nafta outcome after the first round of talks in washington. There were few details, but all three are committed to the 21st standards 21st century standards. They want agreement before politics takeover. U. S. And mexico have elections coming up. President trump will address the nation monday on u. S. Policy in afghanistan. He and his team met at camp david. He said decisions have been made but gave no details. Troops could be sent back to train local forces and show u. S. Commitment to the elected government. The president had previously demanded to know why the presence in afghanistan was so long. Thousands marched through hong kong in support of three democracy activist jailed in the 2014 occupied protests. Two of them were Given Community service, and the third a suspended sentence, but an appeal sent them to prison for 6, 7, and eight months respectively. They say the judiciary is under threat from the beijingbacked government. Indian ipos are heading for a record year as they fight a rally in the local market and great demand for financial assets. Aim to price stock sales by the end of 2017 with the total amount of funds raised reaching 7. 8 billion. That will be 85 increase from last year and cut top the Current Record set in 2010. Say it for singapore has used its National Day Speech to prepare for the challenge of