Steady as shery goes report. There was not a lot of weakening. There was an interesting anecdote that jumped out at me. In the new York District trucking analyst noted there is a shortage of Truck Drivers that firms do not have enough Pricing Power to raise wages. It gives you a microcosm of what the economy is healing with right now. A lack of workers were unable to raise wages because Consumer Spending still remain soft. David any signs of inflation of note . Not much. It was mostly described as it remains light. Not much of a pickup in inflation and hectic going forward. As mrs. Dealing with Pricing Power. Not much signal in terms of a shift. David thank you. We appreciate it. Now we will see how the markets react to the headlines. Julie it did not look like it would be market moving, and indeed, it does not look like it has been, the beige book headlines in terms of the equity action. Taking a look at the bloomberg on bonds. ,ot thing much of a reaction which is not unusual. All three major averages remain the work, although not by much. The nasdaq did touch her record high before falling back. One of the bigger drags is consumer staples. Market came out and cut the forecast. That has been pulling down other pressures as well. Talking about competition and food deflation and the effect on the Pricing Power. Down 13 . Whole foods and kroger also taking a hit. We have airlines today. Number of Different Airlines are commenting added transportation conference. Delta say yank the unit revenue may have bottomed that things are improving compared to the summer. Else west said it will increase capacity at a lower rate than expected last year. That is helping to boost those shares as well. A little bit of a balancing act when it comes to the various groups of the s p. David tim cook returning to the stage airlines are commenting added transportation conference. Delta say yank the unit revenue may have bottomed that things are improving compared to the summer. Else at apple. Apple itself, if you look at how the shares have been doing, bouncing around the lows of the session. When you take a look at apple, with the iphone seven revealed, revealed week is so many of the details of our it evenly as they frequently are when it comes to what has been done with apple, a couple of details with the iphone coming out, it will come in black, silver, black gold and rose go. Black is a new color for the phone. Apple tweeted the details before the technical, official reveal at the announcement today. It is waterproof as well. Will like the home button be force sensitive. That was a feature that was. Evealed at the last iteration well have a dual camera. Apple announced it was partnering with a key on the apple watch. Apple watch not doing much at the moment. Out. Ines keep coming the bigger stock reactions, fitbit, falling as the Nike Partnership is announced. It is down almost 2 . Nintendo notably partnering with apple to offer games on the iphone. That was something nintendo does not do very frequently, those kinds of equipment those kinds of deals. Shares surging. They are of more than 20 . Vonnie they too is a day to watch as well. We will watch tomorrow as well. Day two. Now we want to turn to the beige book. We are joined by ward mccarthy. Thank you for joining us. I want to note a few of the headlines that came out of the beige book. It covers up to august 29. Different districts. Philadelphia noting the pace of Economic Activity slowed. When it comes to things like real estate, commercial real and audits though. There are things we should learn from it. The economy is a mixed picture. It has been a mixed picture really throughout the entire recovery. I think that at least taste on the headlines, it confirms what we have artie seen with the highfrequency Economic Data aware there are pockets of strength and pockets of weakness and some things are just tepid. Frankly, i will be surprised if the fed pulls the hike pulls the trigger on the next right height rate hike. Comments by some fed officials, bill dudley in particular, talks about wanting to get a better flavor for what Third Quarter looks like. The early figures were quite robust. Then we have seen numbers that heightsuggest maybe there are kn the Economic Activity. I think the fed will probably wait. Likely september is more december is more likely. David you say tepid and slight. Not great adjectives to describe the economy right now. Right. Ofget periodic spurts Economic Activity. Times square growth slows down. But the trend has been moderate. Times where growth slows down. Vonnie when you look at the data coming in now, should they have moved . 2020. Dsight is quite frankly, i thought they would move in june or july, and they did to, until we got the employment numbers and the brexit. With the benefit of hindsight, you could say they probably should have gone into live. That is really not a fair criticism in my opinion. They have to move opportunistically. They have to move around and make sure Financial Markets are relativelys table and the economy is doing ok. That really limit what their options are. I think you could make a case that september marginally fits that description. Opportunity to be opportunistic. I am more inclined to think they will wait until later in the year and they have their hands around what is around the economy. Outd John Williams stands as someone out in front. He was speaking last night talking about the need to move and the need to move fast. Is he taking on a new role . You think of the lovely as the second in command, but do use the John Williams taking on a new position here . I dont think he is. If you go back to 2015, he was in the vanguard talking about liftoff happening sooner rather februaryr back in because the fed did not move until december. I think one of his roles to save the fed is going to move along the normalization path at some point. Also, his comments last night did not specifically address september whereas jeffrey lacquered did talk of the september rate hike. William was rather vague. His comments are consistent with september rate hike. The fact that we have heard nothing from bill dudley that the fed is more likely to wait. Vonnie if you did get a market increase, would there be Financial Market turmoil . Quite sure. It will cause market volatility, and the fed would prefer to avoid that. At this point i think it would be pretty difficult to that thes more likely to wait. Convince the markets they are going to go in september. They have a lot more time to do so for december. Vonnie do we need to be concerned about the labor market indicators that are pointing to more week this . This fluctuates from month to month. We had some really bad numbers for a while. If this were to person were to persist, it would be reason for concern. Openings. Cord job that means that businesses want to hire. They just need to find the right people. That seems to be more of the problem than the fact that there are jobs out there to be had. That is ward macarthur, commenting on the beige book out today. The word to remember from that is modest. It the business of sharing is set to soar. This is bloomberg. David this is bloomberg markets. I am david gura. Vonnie i am vonnie quinn. David we want to get ahead check of the headlines from the apple event in san francisco. Emily the new iphone seven comes in a couple of colors, matt black finish, glossy black and rose gold, silver. One of the biggest new features is a new and improved camera, dual image processing. This optimaling image stabilization. It allows in more light, a higher speed 12 megapixel sensor. Rattling off the specifics for the camera aficionados out there. There is talk this could usher us into a new era of photography. This camera now better than ever. The way the dual camera processing works, it takes two photographs at once and merges them together so it is writer and vibrant. Reengineered hardware. Water resistant up to 50 meters below the surface. A gps chip, and they can run with their apple watch without having to worry about getting lost. We were speaking earlier on the she was very excited about these new features, taking away from fitbit. New appleking at the watch. They are calling the new apple watch series two. We have seen new software, and of course, the big news is the iphone seven ironically apple leaked its own news on twitter at the beginning of the event, tweeting out photographs of the iphone seven and likely the leading the tweet. We knew this was coming. New apple watch. They are calling the new apple watch series two. We had reporting to this effect. Now we have more details. A new stream of revenue from this event . Emily there is all this talk about increasing services revenue. Now apple has announced partnerships with nike, nintendo. You can play mario on your apple watch. Pokemon go on the apple watch. A lot of people very excited about that. That is why this software here is so important. Apple not only meets to sell more iphones and apple watches, but needs the software to be better and better. Also expecting a revamped apple music. Apple music now has 17 million subscribers. We know apple music got off to a bit of a rough start. And others. Spotify there has been Management Change within the apple music department. We are expecting a totally project that will hopefully bring in more users. Services revenue will be incredibly important over the next few years as the smartphone closed down david . Apple has put some he hopes in the smartphone watch. To what degree are they resting support resting hopes on this . The very first product category. This is something apple is still very excited about. With the ceopeak and around each Earnings Report and suggest the apple watch is not doing well, they counter by dominating the market. It is a small market, but a market that is growing. The question is, will it ever be more than a niche product . I have four people around the set, and only one out of four were wearing an apple watch. We all have smart phones all smartphones,de our and it is not the same when it comes to the apple watch. The new watch is waterproof apparently. The most requested feature among apple watch users. Is, can it he come a huge product category . We dont know exactly how many watches apple sells. We believe they sold 1. 6 million in the first quarter. Vonnie emily chang. Thank you. Cory johnson outside the event now in the. Will there be two refreshes, an iphone seven and then next years Major Overhaul . Cory the Product Details will be the focus of the event. Reason, as a for a people for reason, they want to sell phones. The details that our business audience and the Analyst Community is leading to dig into are the details around price, dates, many places they will try to sell this into. Apple understands the only way to get the Business Results is a product that people want to buy. That is why this is all about sizzle and take. Steak. Vonnie emily chang and cory johnson, thank you. Donald trump lays out his plan for military buildup. We will break it down next. This is bloomberg. Vonnie this is bloomberg markets. I am vonnie quinn. If you thought the sharing wait. Y was big now, just a new report finds the business of sharing everything from cars to apartment is set to surge. Here is some of what we connect to seep. The shared transport market could grow to 315 billion. 60 of people could be taking part. A breakdown for what this means for internet companies, i want wait. Ng in eric a new report finds the business of sharing everything from cars to apartment is set to surge. Here is some of what we connect to seep. It seems like regulation and people getting sick of using sheridan. How did you arrive at those this. We looked at data coming in over the past couple of years. Downloading on your mobile smartphones. The request see for which they use services. We try to extrapolate against the end market. How do people travel, get to work and home and back and forth. The ubiquity of those devices and applications, and a lot of ways cheaper and more flexible options would lead to Greater Consumer adoption over time. David your looked at have Traditional Companies have reacted to this. How is this affecting Traditional Hotel chains . That if you have the Democratic Convention or the , that there can be a charge byess rate hotels. But now there is that much more inventory in the world. Airbnb is putting more inventory into the surge demand being saturated by increased inventory in the demand. Charge by hotels. But now there is that much more inventory in the world. Airbnb is putting more inventory start with the travel companies, priceline. They have to compete with the all of thesenb and other startups. How have they been doing . The largest start up to date is airbnb. Bought a Company Called home away. Priceline is building out an organic business. So really when you look at the Marketing Budget and the impact of traffic, that gives some advantage over airbnb. Airbnb is also the new kid on the block. So not exactly negative for the Online Travel agent these today, that probably most watched battle. The broader ecosystems versus standalone solo player. Another issue is the regulatory battle these companies have faced. Spending a lot of money to get regulation crafted in their future. When will the Regulatory Environment catch up to where they are rocco it is the biggest hurdle to adoption. Consumers use these. It is regulatory. When you are trying to be a disruptor and going after incumbents, when you are looking at taxation and labor horses running tape certain amounts of money and a lot of incumbent revenue dollars, you will get. Riction how this plays out is the biggest unknown. Regulation has not state too far in front of innovation. We think innovation wins out. Vonnie what is more porton, the amount of market share more important. The amount spent is a lot higher because it is more of a boutique customer. It comes down to profitability. If it is not profitable, that is work. Ing to you will need to see an environment grow up where people are profitable. We think all three players can be profitable longterm. Sheridan joining us in new york. More of the research tomorrow. We talk about how this is impacting hotel accommodations. Investor James Glassman calling on fellow republicans to save the gop by voting for Hillary Clinton. This is bloomberg. David from bloomberg World Headquarters in new york, this i amoomberg markets. David gura. I am vonnie quinn. His dayrump ending detailing a proposal for expansion of military power. Hillary clinton will speak separately at a forum on the military. This comes as an nbc poll shows trump leading clinton 5536 among registered voters that are currently serving or have previously served in the armed versus. Ringing in mark halperin. Armed forces. We bring in mark halperin. Starting with the event tonight. West side of manhattan, literally backtoback. Will he gets a bump from that . He has support. Security something trump has felt from the beginning of the race. Even though Hillary Clintons resume has suggested a more traditional path to commander in chief. I spoke to her campaign manager. Securityves national is a huge priority for a lot of voters and this is part of the message of they do not want message as usual. And that trump can argue he will be an effective commander in chief. You can bet donald trump will. Alk about that nbc poll and he has a pretty overwhelming support from the military family. David Hillary Clinton released an ad on this very subject yesterday showing donald trump talking about National Security suggesting here that he is not resolute enough to deal with some of these issues. Pulling her hair out figuratively, not liver not just trumps past but contemporary usage of language that is anything but diplomatic. Donald trump would argue the country does not want that. They want someone who talks plainly. Saying things have to fundamentally change. I continue to believe a lot of americans will look at the position and say we want nato countries to pay more. Them to have a more mission that is more relevant. This is a test, an area where they would agree. Trump would say i do not speak like a normal diplomat. Clinton would say that is a disaster. Polls are verye close but trump still has a deficit when it comes to africanamericans and hispanics. I dont know that trump thinks he will win on the back of the coalition voters. He is looking to build a different kind of coalition, and if you want business as usual on foreign policy, his instinct has been that is not what the country wants. Hillary clinton will argue i am certain that she did all the way through, that this is not the way americas president can conduct hit or herself and live to the office. Gary johnson will be on your show tonight. What can we expect to hear from him tonight . Gary johnson and his running mate, both governors of democratic leaning a are arguing people should look at them as an option at a time when we have record high disapproval numbers for both major party candidate. Without a doubt, there is an opening, but they need to get better. Appreciate that. An interview later with gary johnson. 5 00 p. M. Wall street time. Attire retired generals signed an open letter supporting donald trump candidacy. Just last month, former Security Officials released a letter warning against a trump presidency. Those opposing, only a few have said they will vote for Hillary Clinton. Longtime republican served in the george w. Bush administration. I want to read a piece that you wrote. You are here t