To grow the economy over there. Israels gdp expands less than forecast. This is becoming a habit. Germany contracted. 20. France was flat. Italy also shrank. Economic data, 10 00. Earnings, really only urban outfitters. Lets do a data check. Futures update, 10 year yield up. Brent crude is lighter. Onto the next screen. Resilient equities. , resilient equities. Dow jones, 16,663. Michael mckee will be out there. A great moderation. Basic chart. This is the zero bound. This is your fed staying at zero Interest Rates for a long time. So many ramifications of that. Much longer will the line extend . Does it continue into 2016 . It is the debate that keeps us employed. Eventn extraordinary since 1 00 this morning. Ferguson, missouri had its worst night of violence. The National Guard was called out. Jay nixon was ordering the guard to restore peace. Night, hours before the midnight curfew, Police Used Tear Gas to break up protests. I say they came under attack and gasoline bombs were used. How did we go from jack dorsey of twitter in a peaceful protest yesterday to what happened overnight where how many people were injured . Eight or nine. We also have results from the autopsy. The teenager was shot at least six times, twice in the head. We know the Justice Department is asking for another autopsy. I was thunderstruck. I woke up at about 1 00 and stayed up looking at the twitter feed. Tried to imagine twitter in 1963, david carr writing it up in the new york times. It has changed the dialogue. The misinformation is out there, as well. We need to get away from the misinformation. Good morning, what is the single message you have for our viewers this morning . Say that things have taken a drastic turn for the worst in ferguson. What started off as a peaceful nastyest extended into a situation. Even children were gasseping for air on the streets of ferguson. The geography of ferguson, what will be the many policeetween officers and what i assume will be many more National Guard . How will that change the landscape you observed . It is interesting because the police already have military style assets. They have huge trucks, longrange rifles, so it will be interesting to see how many officers, with the National Guard. Seems like the National Guard will bring more highpowered assets and maybe even more boots on the ground to try to quell the violence we have seen. We can hear noise going on behind you. Is it quiet . Is there continued protests . When i left the site, about an hour ago, it was pretty quiet. The streets were pretty clear. Most of what happened, most of the action took place last night around 8 00, 9 00, 10 00 in the evening. Police were able to clear the street using tear gas. People havenine been injured. You mentioned the police have longrange rifles. Can you tell us how the people were injured . Say howe did not everyone was injured. There were two people who had gunshot wounds that did not come from police, but came from other people. There are some agitators who are using violence to break up the peaceful protest. Are using violence on others and some are targeting the police. For today. A schedule you have been up all night. What would you presume would be the events of this morning and into the afternoon . The local School District has canceled school. It is likely there will be more children who might take part in more protest. There is going to be National Guard rolling in. A lot of people are angry about what happened last night and said they will go out to the streets. This is escalating and it will continue. Withluse olorunnipa, bloomberg news. Thank you. A setback for the islamic rebels in iraq. Kurdish forces have taken control of the largest dam. Been captured by the Islamic State forces. Meanwhile, the u. S. Is widening the scope of air attacks on the Islamic State. Just detecting u. S. Personnel or threatened minorities. From what we are told, roughly a dozen strikes yesterday, where farmers where bombers were used to target humvee vehicles. Jets, drones, bombers, all in certain positions on sunday. To yourt to go experience of the last week with our air force. We have different planes over there. Our airplanes old . When you get in one, do you feel like you feel on the old, beat up, third world airliner . In goes aboutflew 25 years. You can see the wear and yet it has maintained beautifully. The air force takes pride in the people who maintain those aircrafts. They work hard. The aircraft themselves, they are old. Those are frontpage stories this morning. Our guest host, robert. There are markets who consider i cannot convey to you the number of people who said can europe come to the United States. We will discuss this later in the hour. Global growthng slowing down. We have indicators, as adam said this morning. Uncertainty is about where the economy is going. Quickscan that come over . Did they rip up the script and not to labor . I do not think so. I think the fed is focused on mediumterm issues. They have to address what labor market indicators are for their decisionmaking processes. By excluding the financial community, it will be a longerterm perspective on what things they should be thinking about. Those are very important comments and we will discuss those in about 20 minutes. Much deeper than the negative Interest Rates in germany. We have to go to iraq right now. Arrived aorter just couple of hours ago. What can you tell us set the scene in terms of response from the iraqi government. They have been saying how proud they are of the forces who have managed to get hold of most of the dam. There have been 14 airstrikes by the u. S. Supportseemingly more Francois Hollande saying western france should be arriving in a matter of hours. Italian lawmakers will be looking into this in a couple of days time before parliament. Will be adding to military support here. It is no longer just a humanitarian mission. Aliki is out. How is that impacting life there . Not much of an effect from what i can see. I have only been here for a few hours. He is not necessarily going to be able to do anything in the city of mosul. Frankly, giving that he has only been in office for a couple of days, he will have to work hard to get some of the sunni lawmakers onside. On the ground in iraq. Dollar general making a proposal to acquire Family Dollar. Its is an all cash provides an all cash certainty. It looks like it is an all cash offer here. 70. 50 per shower. Total value, about 9. 7 billion. 78. 50 per share. Total value, about 9. 7 billion. They make walmart look expensive. Is not tradingr in the premarket. Dollar general is up to 62 per share after closing on friday at 57. 46. Talking about fox and time warner in the same way. There yet, we do not want to report that. Think about tom talking about what is happening in media, what is happening in the airlines, what is trying to happen in telecom. This about synergies, Desperate Companies who cannot grow without buying one another . What is it . It is a combination of all of those. It is topline growth. With nominal gdp growth running at the highend, Companies Need to find efficiencies. See theseue to consolidations. A lot has to do with nominal revenue and nominal growth. I cannot convey the backstory davos in january. Go find nominal gdp. It is not there. Is happening in europe, all of the slowing we have been reporting. There it is. Up, economic recovery for europe. We are going to discuss how the ecb president , mario draghi, is managing deflation. The 100flightline for 77th fighter wing in atlantic city, new jersey. I will be going up with the a little bit later, and im going to take you along. Good morning, everybody. One of the great architects of the Affordable Care act, look for that on in the loop. 8 00 a. M. On Bloomberg Television. I am tom keene. Lets get to fly boy, adam johnson. I had the ride of my life. It was incredible. Hows trying to understand the air force is adapting to life after sequestration. They fly with us, go home, take a nap. Are you ready to go . I am ready. You ready to give it a try . Lets do it. Howre are you feeling . I feel good. Thank you. It feels good to get out of that. An incredible ride. What impressed me is the commitment and pride as everybody there. 121 people for each airplay just for each airplane or the thunderbirds . That is the whole team. With support, theres 20 people for plane. The rear drops, and 120 people come out and they just take over. Abysses like dialogue out of top gun. This is like dialogue out of top gun. Each aircraft can be ready in 72 hours. You load it with missiles. Ride, i spokethe to the secretary of the air force and heres what she told us about iraq. Likely to be a shortterm operation. In addition to the support that you have been hearing about, there are contingency planners who are trying to figure out options to present to the president on what our next moves might be. She was not at liberty to discuss it, but we know what some of the next moves were because of what happened over the weekend. Our Defense Budget was going to go back to 1939. Are you going to fly in a b29 bomber next . I hope not. The b52s, which were first built in the 1950s, have been refitted several times. In theory, in 2040, they will be 90 years old and still flying. They are using the plane you flew on in iraq great the f16. Yes. We will continue to discuss the u. S. Defense budget and what happens next, given all the changes. That is coming up later. In the next hour, the founder and ceo of software is our guest host on Bloomberg Television and radio. He is the lead owner of the nbas Sacramento Kings. A lot to discuss. Tablet,treaming on your you television, and on bloomberg. Com. Good morning, everyone. I am tom keene. It is time for morning must read. I have a morning must read for you. This from robert samuelson. Peril onobvious globalization it will prove economically unstable. The financial crisis is discrediting the notion of income gains. We have only a primitive grasp of how the World Economy operates. With us. E there is gains to the elite globally and a lot of this unrest has to do with poverty. Benefitay there is no to labor, but if you go into useloping countries, equalization of labor across the world. Those at the lower end of the scale see things improving and end have toe higher adjust. Is that the stabilizer that adjusts and moves around to provide stability . It should adjust. That is why the pressure has been on the chinese for over two decades. Is it still undervalued . Yes. It is getting there. Bob sinche on the chinese yuan. Good morning, everyone. Risk on. Up nine. Dow futures and 78. Nymex crude pulls back after kurds, we believe taking most or all of the mosul dam. Lets talk about the ukraine crisis. Deal hasvrov says no been achieved on reaching a ceasefire, but progress is being made on the a convoy. Aid convoy. Every day we have inflow of mercenaries, money. With hans, whoin joins us from berlin. What is the take away . There is a bit of a puzzle. German foreign minister said progress was made. We spoke to two of the Foreign Ministers and it is hard to see how there is progress. There is a lot of negativity. Foreign minister leveled harsh attacks saying money is coming in, clearly there are mercenaries. To see theling reason for optimism. Perhaps, and please help us sort this out together. Sergey lavrov says there is at least progress on the convoy. The only thing on the border issue, maybe they are having him sort of agreement as to who is going to control the border, but, convoy, sergey lavrov, i went to the Ukrainian Foreign minister and said is there convoy going to be in ukraine in 24 hours. He said he had no idea. He said it is up to russia. Let me ask a dumb question. Takee ukrainians in kiev , who are the people with . Or they with the separatists are they going to greet the ukrainians from kiev with flying flags . Ukraine want to be part of russia or do they want to be part of ukraine . I am not on the ground to ask enough people. It gets to the core. Culturally, ethnically, what are these people. Today identify themselves as ukrainian or russian. A 50 split . Ave it gets to the core of what selfgovernance and democracy is about. With the ukraine talks hitting a wall, give us a sense of what to look ahead to. What will you look for is the talks continued. All parties are going to go back to their home countries. One reason or cause for optimism as if there were a meeting between the heads of state, beween they need to addressed at the head of state level. A meeting like that, i will buy into the optimism in that tom was talking about earlier. Thank you for giving us the latest. How about the sealed. 0. 951 . That was the yield earlier this morning. Europe confronts contraction, deflation, and features of depression. Could america catch a breath . It is the fear of everyone. Financialoes this impression continue . Demographic. Is is we have talked about this a number of times. Is at best stagnant and in some cases declining. There is a group of said officials. Are they fighting the last war the next war of inflation . The two year yield is a negative yield. Why is Charles Plosser miserable . They are concerned about what the fed does going forward, how large the Balance Sheet has gotten, what the implications are. Am less concerned boomers, this Demographic Group was going through consumption years. We are now aging. We are not consuming as much. I think that has a lot to do with global deflation. Bob sent, we are aging. We talk about the divisor the divergent monetary paths. Europe and japan are not going to be the source of aggregate demand in the world. The u. S. Fees to continue to export to those parts of world that are growing. Those parts of the world need to grow domestic demand. That has been the question. Would china and india be able to grow enough to get their income levels of so they could be more engines of growth, which we do not see a lot of in the world. Should we be focusing on countries, given the problems outside the u. S. We want to be focused on Competitive Companies. What we have seen in europe and japan, companies are not that competitive anymore. Industrial production is lower than it was in the beginning of 1995. They have outsourced so much from japan. Developed among nations in terms of production is actually the United States. We are seeing european companies, planes, the like in the United States. Flexible labor markets and chief energy, those are the things driving growth. It looks like those will continue for a while longer. In place, europe is strapped by what they want to be, arent they . That is part of the negative Interest Rate moment. What they are finding out, they do not work. Are struggling to figure out how to get to a better place. Going totment process, more flexible markets, the adjust them in process is not pleasant. Germany struggled. They went through that adjustment process. They are better for it. I think this issue will not go away. Our coverage of the said. Michael will join us. Demand fromd about china. Coming up, why prices for luxury diamonds and fine wines are falling. This is bloomberg surveillance. We will be back. Good morning, everyone. Our twitter question the events overnight in ferguson missouri. What is the solution in and for the people of ferguson, missouri . We need your thoughts and opinions on what you observed on ferguson. This is bloomberg surveillance. With me, scarlet fu and adam johnson. Headlines. Our top pope francis is calling on koreans to end 60 years of division. He challenged the north and south to reject a, confrontation, and conference and competition. Challenge ahead for atlantic city. How to avoid having empty shells left by the closed casinos on the boardwalk. End ofll be shut by the the summer. Possibilities include corporate headquarters, timeshares, or condos. Dollar general is making an offer of its own, the deal with the with nine be worth 9. 7 billion dollars. It appears to be a threeway conundrum. A global slowdown in sales of luxury goods has spread to the highest quality diamonds and fine wines. Seee call it up, you can the purple line tracks fine wine prices. Down about 31 . The white line, the price for top quality diamonds down. The yellow line, lower quality smaller diamonds. The past twod over years. The reason why, one reason, Chinese Government policies aimed at discouraging ostentatious behavior. If you are one of the 87 million communist party members, you are careful about what you buy. Now, you only get polished diamonds. Diamond is not the highest quality grade. Something that needs to be dressed up a little bit more. China is the second largest diamond market. China overtook france as the number one market for fine wines. , end diamonds the be all all . Jade arend traditionally the preferred gems over diamonds. They are trying a Marketing Campaign to encourage people to look at diamonds in the same way americans do. Is this a quirky observation or does it state to some sort of larger comment about luxury . You cannot flow capital out of china and what they would do is consume things that presumably had valuable add value. Interesting. Speaking of stores of value, he has been stored in the ecuadorian embassy. , i have lostange track how long he has been hiding in the four walls of the embassy. That is a lot of watching of little britain. He is leaving. E Caroline Hyde is standing by to fill us in. What was the catalyst. Why is he leaving . It is very cryptic. We do not know. There was a press conference and it seems as though it has been reported his health, the founder of wikileaks has been prone to and might as of late be exiting the ecuadorian embassy. He has been there for two years. Trying to avoid the detention order from sweden. The police and media are waiting to see whether he will be giving