Up. 8 30 in the u. S. , Consumer Price index. Finally. A look at inflation that is not affected by the weather. Inflection. A little 10 00, Richmond Fed Manufacturing activity and existing home sales. The bell,efore cocacola, mcdonalds, lockheed martin, verizon. After the bell, microsoft and electronic arts. Prince george turns one today. Very important. No question about it. Today have any idea what is coming . The Birthday Party was a huge hit. Lego party. When i was a kid, i had legos. I made them take my bucket of legos in the car for car trips. Not sure my dad appreciated that. N ive stopped many a toe o legos. Bonds, currencies, commodities. Market is turning. Futures advance, 10 year yield under 2. 50 . Euro weaker and hyper carbon euro weaker and hydrocarbon elevated. Vix churn. 12. 821, pretty good, equities have been resilient. Dow above 17,000. Yen weaker after two days of strength. Gold strength. Scarlet will talk about the german 10 year yield. Heres the dollar, spiking high er. Bet on what the outcome could be for europe from addingwith sanctions and cold and on from all the sanctions and getting cold in autumn. Our first frontpage story in ukraine, the bodies of the victims of mh17 have begun their journey home to the netherlands. The train carrying them arrived , government held city. Prorussian rebels have handed over the black boxes as pressure mounts on Vladimir Putin. He released a video overnight in video, offering conciliatory words. Not clear what the next step is. The eu is considering tougher sanctions, waiting for some kind of movement. Going after as we just mentioned, going after individuals in russia. As was originally the plan. There were 11 targeted in the first round. Now they are going back and getting tough again on people. It is clumsy. There is still fighting going on. Still skirmishes. Officials try to go in and they decided it was not safe enough. Dutch officials attempted to do that and had to turn around. People want in, rebels were shooting off guns. The inspectors are wearing bulletproof vests. To rescue i shouldnt say rescue trying to remove bodies. Try to gather evidence, it is hard to fathom. We have to move to the middle east, the u. S. Is calling for a ceasefire in gaza as the death toll nears 600. Actually, exceeds 600. John kerry holing talks with egyptian officials on more aggressive diplomatic pushes. He told reporters that hamas needs to make a decision to halt two weeks of fighting. version is that it was not consulted on the proposal, which israel accepted. Its demanding that any accord lift economic curbs on gaza. Gaza areots of stunning. What i find interesting, correct me if i am wrong, you look at the headlines we have in the terminal, not much news. Not many headlines from israel. Not many headlines from ukraine. There is a lowland the storm. Fighting continues. One headline that jumped out at me, 149 children have been killed in gaza in two weeks. 149 children. Ones saying no, we dont want to participate. A lot of people say it is in their interest to remain belligerent. Thank you for saying belligerent. President obama, effectively, said that as israel yesterday. That was a very strong statement. Interesting to see the news across Bloomberg Television today. We will go to tel aviv in a moment. The final front page. A company news story, time warner and the attempt to block the takeover bid from 21st century fox. Support of time warner is taking a step who fording to th warting the offer. Removing measures investors could have used to pressure time warner to sell. Delaying action to force a vote annualune for the shareholders meeting. I thought you were going to say yosemite sam was hired as a banker. Bankers are lining up. This is a 80 billion bid. Se of and everybody else yosemite sam and everybody else. This would postpone action until june . Delay action to force a vote until june. One effort they are making to stay this off. We will monitor this headline along with the others. Those are our frontpage stories. Upfutures up 6, dow futures 60. Effort toairo, an work towards bases fire brokered by egypt secular government. This is a timeless but of arabisraeli how, hamas and israel are too far apart. Elliott gotkine is in tel aviv. How have the israeli people reacted to what they have observed in gaza . Large israelis support the israeli objective, the israeli operation in gaza. Not to say that there is not a degree of discomfort at the rising toll of casualties on the palestinian side and in particular the toll on the israeli side. 29 israelis have been killed. Plus are what, 570 palestinians killed. A large number of those are children and noncombatants. There is discomfort about it israelis by and large support the fact that this is something israel was reluctant to join into and it had to be done. We focused on hamas and how they are distant from the ceasefire. Secretary kerry and the egyptians are speaking of. How close is israel to wanting a ceasefire . The egyptianepted ceasefire proposal last week, hamas says it was not consulted. It says it would go to egypt to discuss the proposals. Kerry, due to meet with nextdent alsisi in the half hour or so, has said the ball is in hamas court to accept the ceasefire proposal. Hamas is demanding not only in end to the blockade but also the release of prisoners that were really arrested during the search for the murders of three teenagers, three israeli teenagers. You mentioned secretary of state kerry in cairo for meetings in about 30 minutes, do we have a sense of who is driving this . Secretary kerry, the egyptians, somebody from either side, loss or israel hamas or israel . The u. S. Clearly thinks netanyahu has made his point. Right saying israel has a to defend itself, has expressed concern about the rising number of civilian casualties. Tory is not in town just make up numbers, he feels he can make a difference, perhaps by knocking heads together. The egyptians are no longer on the best of terms with hamas. They are crushing the Muslim Brotherhood in egypt, a brother organization of hamas. Although egyptian egypt is seen as the only one that can perhaps work on this ceasefire, it is not clear that hamas sees them as an impartial adjudicator. Thank you, Elliott Gotkine from tel aviv. You see the tension and the times. Ukraine photos, palestinian photos of anguish and agony. Of the newhe cover york times. Pain on both sides. We want to introduce our guest for the hour, president of the committee for responsible federal budget. Senior Global Political analyst citigroup, tina for him tina fordham. Where might we get a ceasefire first . Gasa or gaza or ukraine . Gaza, theres more pressure. And ukraine, president poroshenko has an opportunity to flush separatists out of eastern ukraine. Nobody is telling him not to. Vladimir putin delivered a video message offering consolatory words, why have we not seen more from him and mark he is in a difficult position. This is an organic movement in the eyes of the kremlin rising up to fight the legitimate government and kiev. With their backing. You say that, i cannot comment. Putin will want to play for time. The fact that the black boxes have been turnover is important. There. As a delay the next step would be to push for an international investigation. You write brilliantly on the politics of all this and how it folds into investment. We will have richard haas in the next hour, he has just written of the 30 years war. As you write for citigroup, do you perceive what america is seeing as a beginning of a set 30 years worse . I have called it a paradigm shift. We have a concentration of geopolitical developments. So far, they are not moving markets. That is because there is a perception leg. Lag. The last 25 years since the fall of the berlin wall have been peaceful and prosperous. That is what investors are used to working in. Committee foress, responsible federal budget. Is there a risk that as we focus on so much happening outside the u. S. That the issues facing the u. S. , the federal budget deficit, etc. , might get pushed aside. The federal budget deficit is so intertwined. One of the Biggest Challenges has been Economic Growth. Now, with what is going on around the world, you remember they are international, global risks we need to be paired for. Ising a sound fiscal policy critical to help grow the economy. It is also critical to be prepared when you have situations overseas which may cost more money and may have effects on the Global Economy and depressed things. The problem is that right now, because we have ever spent, over borrow, and have a High National debt, we are unprepared to deal with these issues in a way that we could have in the past when our debt levels were lower. Glad you are here with us. Our twitter question of the day, as the world focuses on ukraine and gaza, where we ignoring . Tweet us bsurveillance. Domestic issues, other geopolitical issues. Syria . China and japan, etc. Usim tweet bsurveillance. A strategy shift at Credit Suisse after posting the risk really loss in six years. Credit suisse said it will stop commodities trading. The fine from the u. S. Tax investigation cost more than 2. 5 billion dollars. Apples iphone launch this fall will be its biggest ever. The screens will be larger, 4. 7 and 5. 5 inches. Apple is asking suppliers for 80 million phones, the companys biggest initial order ever. The Hedge Fund Manager who has been attacking herbalife will hold a News Conference this morning. Bill ackman says he will review his latest findings about the shake maker. He claims it is a pyramid scheme. That is this mornings company news. Adam . Talking about netflix. Are you a fan of orange is the new black . 50 million subscribers a muddy stock is up, we will talk about it. This is bloomberg surveillance streaming on your tablet, your phone, and bloomberg. Com. Good morning. Good morning, bloomberg surveillance. I am tom keene with scarlet fu and adam johnson. A discussion on what i do not watch, i think im the only one on the planet. You watchingt netflix. Shares rising in the premarket i 450 seven dollars. Not a blowout quarter but enough to impress. Secondquarter earnings more than doubled. , sales rose share 25 . Topline and bottomline 1. 15 versus . 49 a year ago, more than doubled. Rate, butnal Growth Investors had priced in a lot of this. In terms of subscriber numbers, added more u. S. And International Subscribers than anticipated. Margins are expanding as well. It has a little bit of Pricing Power because it introduced price increases for new customers. Do they still do the dvd in the envelope . Part of themaller business. They are focused on streaming domestically and internationally. Because of the expansion to overseas markets, especially europe, that will hurt. Because of your research and what you saw from the sell side, what is the upside from here . Theyre trying to be like hbo. They have arty beaten hbo in terms of u. S. Subscribers. But yes, their time to do more original programming. Money they pay and licenses has been burdensome and they need to stop doing that. 36 million made per year. What is the next gold mine for netflix . Are looking to reach 60 million to 90 million u. S. Subscribers. As much as a 150 increase from the current level. And a lot of people point out it is going to be harder to get the next 35 million that it took to get the first 35 million. Saturation domestically. It is like wall street, what have you done for me lately . Yourre only as good as last trade. Quit house of cards, blockbuster. Largest and a black house of cards, blockbuster. Orange is the new black, blockbuster. They are going to do a new series on marco polo. Are you going to watch . I say im not going to watch and then i get sucked in. Andaya, they have 18 buys 18 holds. Rare occurrence on wall street. Usually everyone is on one side. In the last, 400 couple years, you want to be a little cautious. An eye on netflix. Fairly positive. Mark mahaney looks like a genius. What his price target . 530. At 470 now. Weing up, richard haas as continue the conversation on all the geopolitical headlines, whether in the ukraine or gaza. This is bloomberg surveillance on Bloomberg Television, streaming on your tablet, and bloomberg. Com. We will be right back. Good morning, bloomberg surveillance. Good morning from new york city. With me, scarlet fu, adam johnson. Our morning must read. Morning must listen. Courtesy of our colleagues in london. Manus cranny said down with the ceo of Credit Suisse. Listen to what ready to and listen to what brady dougan had to say. One of the most and fork is one of the most important focuses has been running a compliant businesses. We have a pretty good record. We have not had any issues on the libor side or fx side. We have learned a lot of lessons and we continue to try to work very hard to run a compliant business. That is an everyday challenge that you really have to go to work at and try to tackle every single day. I think we have actually had a pretty good record of that. That is something were going to continue to be focused on. It is the right thing for the shareholders, we have to run a compliant business. How many times did he say the words compliant business . He had talking points. Consul said say compliant business. We did not get in trouble for this, for that. Earnings are one third of what they were before the crisis. The battle with each bank being different. Maya macguineas with the committee for responsible federal budget. In honor of dr. Frank. Frank in honor of. Fran in honor of dodd frank, thumbs up or down . The amount of time it takes them deal of compliance is stunning. The changes for the entire industry. Do people feel more certain theyre going to be crisis Going Forward . No, still many risks on the table. Are we compliant . [laughter] they are. Is pushinglion fine it to rethinking its strategy. In ukraine and gaza, beginning of a criminal investigation in london on currency matters. That will take a couple years to resolve. We will keep an i on these big global banks and their compliance. Coming up on surveillance, chaos in the middle east and ukraine continues, what does the global unrest mean for the World Oil Supply . Andand adam, nymex crude brent. This is surveillance pickup findarlet fu and i cannot words to tell you what the last two weeks have been like in new york city. It has been gorgeous. Like fall, except war. Everyone is out of town. It has been gorgeous. Humidity, you can go for a run and you are happy to be there. Better not be any excuses about thirdquarter gdp. Morning, bloomberg surveillance, i am tom keene. With me, scarlet fu and adam johnson. Quickly on the equity and bond markets. Euro under 1. 35 on significant dollar strength, oil elevated. West texas intermediate, 105. 25. Adam . Withinia and iraq rank the top seven Oil Producers in the world. Russia faces sanctions and insurgents threaten iraq, prices have not spiked. Tina fordham, citigroups analyst, one of the most influential women in finance. Risks, most political markets have localized everything that has happened. At aad isis in iraq, look map, you see that the Oil Facilities are in the south and the krg, curtis Regional Authority is still pumping. Libya continues to produce. The effect is a pretty minor fear premium. Still oil coming out. Is there still a risk that longer term there is not going to be investment to keep facilities up to spec . Thats an open question. One of the things we will be looking for is whether isis and pushed can be pushed back towards syria they have not been pushed further. , give usroader scale opec. Ate on the strange relationship between russia and the saudis and major players. Russia finds itself in a very unusual position. Spent a lot of his second term trying to get russia integrated international institutions, from the wto to the g8. Opec aside, one of those things on the table for sanctions is whether russia might be moved from the g 20. Althoughuggest that that is the kind of thing that Market Street as a symbolic from the point of view of russia as a sovereign, it would impose costs. Do sanctions work . Case has always been south africa and the antiapartheid sanctions. They did work. That is an example of how things work. Iswashington, the iran case an example of how smart sanctions work. What is different about russia, russia is a country that is most integrated into the Global Economy and Financial Systems of any country that has been sanctioned. Cuba, libya, north korea, axis of evil countries, russia does not fit into that group and is a member of the un security council. It is something that really has never tried, hence the toing and froing we are seeing. Investors are localized and risk. The low interestrate environment allows them to do that. What happens when the Federal Reserve and bank of england starts normalizing Interest Rates and increase . It is a sign that it is the most important to wash. We talked about the proliferation of geopolitical risk. Many of which are systemic in nature. Why isnt there more of a reaction, the answer is always liquidity. It is not the scale, it is the liquidity around the system. Sanction a country and then all the sudden, the weather gets cold and say yeah, europe needs oil. Thats why you have seen the sanctions on individuals, the incremental tactic here. Sanctioning energy is unlikely. Maybe technology to do with energy infrastructure. There will be an effort to keep energy off the table. There could be moves to get to toividuals closer to putin impose costs on the regime and not economic blowback that could derail european recovery. Good having your perspective. Lets ask our twitter question of the day. As the world focuses on ukraine and gaza, what are we ignoring . Are there other spots in the world we should be more focused on . Tweet us bsurveillance. Some breaking news. More m a, cit, a nonbank finance company is buying one mustang. One bank. Adding to earnings per share, 20 ets in 2016. I remember the morning of indymac. They aretus trying to restructure and this is what you do. Chunk of the follow