They say there is no evidence they stole debit card pins. A dutch investigation points to a belief that the Malaysian Airline plane was shot down by a missile over ukraine. The u. S. Has said prorussian rebels probably down to the airplane this summer. Listen up, ladies. Goingchoo is close to public. Theyre seeking a valuation of about 1 billion. You can buy a lot of shoes with that money. They areack to apple, expected to unveil the next generation of iphones, heating up the battle for the smartphone market. We have talked about this the last several days. Cory johnson is at apples home. Lay this out for us. Apple is trying to regain some lost ground in the smartphone market. That is fair. They have had a successful business, but a market in 2007, a market that apple stormed into and dominate, that is not the case anymore in terms of global competition or the smartphone business. Samsung has eclipsed apple. It is possible in revenue as well, samsung is outpacing apple. Apple is looking to revive some of the market share gains. Ann you look at it from operating systems standpoint, the galaxy phones, as well as other phones using the android operating system, there are a lot more people using smart phones with Google SoftwareOriented Software than apple ios. They want to keep the profits and gain some market share. We have not seen these kind withaks as we have seen apple. We know more than we ever did, especially under the steve jobs era, about what is going to be released. What is the deal there . We will find out what we dont know today, to a large degree. For all of the marketshare losses in the android success, there has been tremendous growth inthe apple product line terms of any of the things that they sell, with the exception of the ipod. We have seen them sell more units, more phones, billions of dollars. The iphone is the most successful Consumer Electronics product ever. It has made more money than anything else. They have sold more units since the first iphone released in 2007. Leaks ahead. We will watch you, cory, and your teammates when the announcement is made. Make sure to watch him and his team for the special event at 1 00 p. M. Eastern time, right here on bloomberg television. Salest got the dismal results coming out from mcdonalds. Global cells global sales down. The chinese supplier issue, that have been hurting other fast food chains, it will hurt their earnings by . 15 in the quarter. I want to bring in julie hyman. You have been going for some of these numbers. They are terrible. Sales are down 2. 8 . Affected in part by supply issues. A lot of Food Companies generally in china, concerns about the supply of meat to various firms. That affected the japanese sales as well. The Chinese Company also provides a lot of stuff to japan. In europe, sales were 7 10 of 1 . Strong sales in the u. K. , but that is offset by what is going on in russia. Russia has shut down the mcdonalds they are and they are reviewing if they will shut down 100 more. At least . 15 is what we will see coming off in this quarter. What is tied to what is going on in asia. This is largely out of the ceos control. Don thompson has not been on the job that long. He was appointed in the summer of 2012. Timinghave had the worst because he joined right when people were talking about the whole obesity debate. Also, chipotle started to gain some ground. You had the issue of minimum wage and that protest beginning. Adding on all of these other issues going on overseas. If you look at what u. S. Consumers want, you are talking about a trend like knowing where your food is sourced. Customization. Both of those trends chipotle has capitalized on. It is seeing growth to match. If you look at demographic attraction to mcdonalds, those going once monthly to mcdonalds, generation z, they are looking at people 19 to 21. The young people are not going. The people who are now having children are not taking them. That is not happening to the same extent. To your point, when you talk , some of larger trends this is that of Don Thompsons control. Appeal,also the kid measured in the eyes of parents, chickfila past mcdonalds for the first time in 25 years. Remember the happy meal mascot fiasco a few months ago . They are having a hard time connecting to the very young. Part of it is there are so many other good burger choices. A mcdonalds is not the only game in town. , a list of 21 burger chains, rmb mcdonalds rank the last. Number two. As five guys, number three. Even if mcdonalds is more competitive on convenience, you have talked a lot about the bloating of the menu. Toe of the analysts i spoke spoke of a return to mcdonalds roots. Theaid if you looked at menu board, there would be maybe 20 items on it. Maybe they need to parrot back a little bit. It back a little bit. Thank you. That is not all we have for mcdonalds. I want you to catch my new special on mcdonalds, beyond the golden arches inside mcdonalds. Moving on to movers and shakers. Eric schmidt is speaking at a hearing. A European Union told google to remove certain information from search results on request. The rightto balance amount of information versus the right to privacy. Google plans a hearing in seven cities. They are the selfserving attempt to guide a debate that belongs in the court. Staying in europe, scotland is nearing a vote to decide whether was separate from the u. K. The polls show that the vote could go either way. For more on this decision, and add words joins us from london. David cameron says he is going to be heading to scotland to make the case to stay with the british. We have had the policy initiative. The fight back has started. Last night, gordon brown came out with a new policy called the new scotland act. Details of further devolution to the Scottish Government. Power to get further collect more taxes themselves, locally. Today, the comments you are referring to, a little bit more of an emotional connection. They are trying to make that between the better code the Better Together campaign. We are seeing david cameron, ed miller band, they are all planning to be in scotland tomorrow. Some of them are calling for the Scottish Flag to be flown publicly in the rest of the u. K. As a plea to scotland not too late. What happened on september 18 . Ets say they vote to break up what will happen then . That is the day we get these though. It will come late that night or early in the morning. Going to change on that day. Part of will still be the u. K. , but they will have expressed their wish to leave. Has set out a timetable and there will be a negotiation period between the Scottish Government and westminster, where the u. K. Government said. All of those negotiations will have to take place and Scottish Independence day would it be late in march, 2016. We need to have the vote first. Those tape place on september 18. That is next thursday. Thank you. Coming up, members of congress threatening to crack down on companies who want to escape the u. S. Tax system. We will talk to harvey golub. The screen on the new iphone may be tougher to break. That is good news. We will show you something even harder than the famed gorilla glass. Theack lew reinforced stance on tax and version, the strategy that allows u. S. Companies to acquire overseas companies and take advantage of the lower tax rate. This allows corporations to avoid civic responsibilities while benefiting from everything that makes america the best place in the world to do business. This may be legal, but it is wrong. Our laws should change. Our laws should change. Our guest is harvey golomb. Now, he is the chairman of miller, buck fire, and harvey. What did you make of what jack lew just said . That we need to keep the companies at home and we need to change the law to make sure they do. We should change the law to attract more companies to the United States. They have the most arcane Corporate Tax scheme in the world. It has the highest tax rates in the world for corporations. It has territorial tax systems. Pay taxes ine to the United States for money they earn in germany. The idea that companies would act in a way to maximize their taxes paid is ridiculous. Thes are crossed corporation, just like any other costs. Corporations manage their field so they pay the minimum amount of taxes. About this whole idea. You are running these companies, but it rubs people the wrong way. It is unpatriotic. You should stay within your own country, support your own employees, support your country if you can afford to do it. Is not a question of what to afford. It is a question of what maximizes the companys business. If i am in new york and paste a pet estate taxes in New York Corporation to texas, why would new york say that is unpatriotic commie start why arepany and your, you moving out of new york . Topanies operate in a way maximize their business. Notw should focus on building a wall. That will prevent more companies from coming here. He should argue for a change in the tax laws and structures of corp. Rations to make them more attractive to be here. Ower the tax rates i would lower than 20. I know you would. It is not possible. It is possible. It is not politically viable. Of that is true. You would eliminate a whole industry of tax avoiders. You would make the United States attractive. Are a german company, maybe you need to be in the ad states where the tax rates are lower. What is realistic . Should have zero tax rates, but what is realistic . Aboutporations now pay 170 5 billion a year in Corporate Taxes. Out to about a third of corporate income. There are a lot of ways to avoid Corporate Taxes. You can have a company and have the money go to its shareholders. You could lower the rates and eliminate all of the deductions, make the tax code consistent with cap accounting and have with gap accounting and have everyone pay a percentage of their earnings. Why should a u. S. Company pay on money earned that is why you have money trapped overseas, not being repatriated here in the u. S. If you are in new york and decided to move to texas, who will say anything to you . You would not move from new york because new york is where most of the talent is. Strategically, that would not be the smart move to make. It rubs people the wrong way that companies are doing this, not for strategic reasons, but to avoid paying higher taxes. It will operate the companies from the u. S. , so it is like they are getting a freebie. They are doing this in order to reduce cost. Competitive more with other companies that have a lower cost structure. If you are an English Company, you pay taxes at a lower rate than that the United States. The English Company is at a competitive this advanced globally against the u. S. Company. The u. S. Is acting in a way that makes them more competitive around the world. Much more. It has been a wild since we have seen harvey. Taxes, andout overall of the tax code could pay for infrastructure improvements. Tune in today as jack lew and inhony foxx make their case a joint interview at 4 00 p. M. Eastern time today. Coming up, foul play. It can be a business to go to a majorleague ace ballgame these days. How risky . We have some numbers ahead. You are watching in the loop. We are streaming on your phone and at bloomberg. Com. Heres a look at the top headlines. Formal portfolio manager, he has been sentenced to nine years in prison in the most lucrative Insider Trading scheme ever. Martoma was accused of using illegal tips to make profits. England governor, mark carney, says they may raise the Interest Rate by next spring. Rates are at a record low. Said it has asked beaded has exceeded all expectations. Another blow in atlantic city. Trump entertainment resorts has filed for bankruptcy again. It was founded by donald trump. In atlanticcasinos city. We get to our next segment, i want to make a correction. Was fired. Rk it was a mutual stepping down. Bloomberg television is on the markets. Equity futures are slightly higher. You want to watch some stocks in particular. Mcdonalds coming out with some dismal sales results. Global sales down 3. 7 , much worse than expected. We are on the markets again in 30 minutes. Economyure of the u. S. To create as many jobs in august as economist expected or close to the level of the last few months is adding fuel to the argument that the recovery is too weak. We got the white house reaction from the chairman of the council of economic advisers following the report. Last three at the months, we averaged 2007000 jobs a month. We have extended the largest private sector job straight. We have added 10 million jobs since we started adding jobs. The Unemployment Rate is coming down faster than anyone expected. There is more we need to do. Theres more the president wants to do, but lets not get excited or unexcited for any given month. Clicks they want to throw out the last months reports. I want to bring back harvey golub. He is a prominent republican voice. , the sameear that say t, you the economy is improving. It is not even an interesting point. Since the end of world war ii, in 90 of the years, the economy improved. Does not improvement mean anything. We have had 11 recessions and 11 recoveries. The question is, how does this recovery and job growth compared to others . Since the end of world war ii, the average growth in employment during that period has been 11. 7 . It has been five years since the start of the recovery. This recovery is 6. 2. In 6. 2 generated 10 million jobs. If it was 11. 7, it would have been 20 million jobs. 9 million jobs lower than average. This recovery is not even mediocre. Thehanging fruit accomplishments they have made are the low hanging fruit. They have made no accomplishments. We have had gross, but when it is a 10th of 11 worse in job growth. Off. Ople are better look at the stock market. At the corporate activity. Ceos are more competent. They are engaging in mergers and acquisition. You see business deals being done. Some people would say we have cheap money, the feds are, native, this is a great time for some people. The fed being accommodative and pumping money into the economy has been good for the stock market. People like me who have substantial investments, we have done well. If you look at single women, the middle class, africanamerican, hispanics, they are worse off. Their jobs are not there. They are not able to support their families. Cost ofook at the having low Interest Rates, all the people who have saved money all of their lives are now getting nothing on their interest. They have to go out on the risk curve. The idea that this government has decided it will help people and hurt my nextdoor neighbor who is retired and living on a fixed income is not fair. You have aoned prominent republican voice. You and i talked during the election. Is there a missed opportunity by the gop . Couldoint you are making be made by the opposite side. They missed the boat on this. We should be here making the case to the women and minorities and the poor who have not benefited. There is clearly an opportunity to demonstrate to people how conservative policy is for Economic Growth. Allowing the economy to boom would be helpful to individuals. What we would rather talk about is how a growing economy would help an individual person, how a woman trying to raise children, not making much money, would be helped by an economy that was growing. Who is a good messenger for that . There are a number of good messengers. An entirelyhas internalized understanding of how conservative values will help the economy. I think that is true of most republicans. How toue they have this express that point of view, how to explain it to people, and a way that is persuasive to people. Through the financial crisis, you had clash with Bob Benmosche a. He stayed on. We did this interview with him in croatia. We look back at his time at the company. I want to play for you one part of our interview on what he said about the fight, the clash over the bonus payments. Want to read one quote. We are at war. War over the bonuses. Why werent they at war at the hundred Million Dollars that was spent to between four firms. I will not name them, but one was an accounting firm, one was a lawyer, another was an Asset Management business and the other one was in consulting. In 2009, paid out of aigs shareholder coffers, 100 million, but watch the people of aig work. See if theyre doing the right thing. Spenttever he said, we one million watching people that you pay wires 65,000 to that work in the business they earned. What do you think when you see that . I think he is right. And ie were brought in became chairman of aig, aig had a multitrillion Dollar Financial portfolio that it had to wind it down. Wasgovernment interest trying to wind it down as quickly as possible. The market knew that. The pricing of the securities were not good. By the speed that the government want us to apply, it would cost between 10 and 15 billion. Bob and i wanted to slow down and disband the portfolio. We needed people to do that. Sensible people to do that. Save 10 billion, i do not knowabout that. Steppedou glad you aside . Absolutely. They were delightful people to work with. To comed we were able up with a strategy that allowed aig to survive. I think bob has done an excellent job of being ceo. Harvey, great to see this morning. Thank you so much. Ofvey golub, the chairman buckfire. We will show you the evolution of one of the most popular products in history. We will be back in two minutes. We have the documentation of the first seven years of the iphone phenomenon. Rick say can be traced back to the ipod. The earbuds became icons. The sales were bigger than the macintosh. Apple was a transformed company. When asked if the next device might be a phone, steve jobs said selling anything through carriers was too difficult. He said we are not good at going through orifices to get to the user. It is a hard problem. It was a ruse. They were working on a device that was a phone. In 2007, they announced the iphone.