Quarter declined because people assumed health care was going to create a delay. Without further delay, lets go to scarlet on home depot. The earnings just came out, a beat, secondquarter earnings per share of 1. 52. Expectedthan bottomline number. Sales topping estimates as well. Depot confirms its fullyear sales forecast. Adding to its buyback program, overbillion Share Buyback the remainder of this year. He moved to engineer a higher earnings per share number continues. With adam parker joining us in the next hour from Morgan Stanley, use of cash. The pressure to deploy cash. You see that in the bhp billiton restructuring. What are we going to do to distribute cash to shareholders. 838 on the the 16 dow. A distinction between home depot and lowes, the Bloomberg Industries team pointed out sales will likely come in stronger. An estimateds 4. 4 . Home depot doing it more effectively than lows. Medtronic and t tj maxx report earnings as well today. Hasuple items of note it been 10 years since google started trading on the nasdaq. Google ipo. Does not seem like that long ago. Leavitt, heur turned to me and said what is it worth . I got the guess right. I did not buy any shares. That one. You on meanwhile. One other birthday of note. Happy birthday to William Jefferson clinton. Happy birthday, mr. President. Thats the brief. Are you checking on what bill clinton is doing . Howe is still calculating much money he could have made on google. The gerbil is not working this morning. Lets look at other data. Equities, bonds, currencies, commodities. Risk on continues, future go future go up 3. The 10 year yield confounding economists. Poundsterling weaker. Complacency, 12. 32. , 16, down to 14. The german bonds above 1 . Exactly 1. 00 . Let me go to the monitor, this a correction. H this is the correction in the dow. Down 4. 5 from the peak. That is scary. Madeis is how much we have up as we consider what we do next. 50 . Is the old you go down a certain amount, you get halfway back up, then the guys at the trading desk say 50 retracement. You made a commission along the way. We will give you our front page. We have looked at the newspapers and the webpages. Greater st. Louis, another night of violence in ferguson, missouri that is our top frontpage story. Police fired tear gas and stun grenades. They battled 50 demonstrators who defied orders to leave. This over the killing of an unarmed black teenager by a Police Officer 10 days ago. The result of the private autopsy showed that the man was shot six times. Twice in the head. Last night, the white house holderat eric will be traveling there tomorrow. Meeting with the fbi and others. Twitter has played so much into this reporting. It was actually fairly calm at about 10 00 and 11 00 p. M. Of quiet, that is operated at about 1 00 a. M. , plus or minus an hour. Very difficult. We are going to go there live in a few minutes. U. S. Will keep using it strikes. Theident obama says airstrikes have led to important progress, stopping gains in Northern Iraq and helping Kurdish Forces recapture the dam. They have captured all the dam. Thank you for the perspective. He did this air force yesterday, flying in an f16, did you go over the Atlantic Ocean . Sidewinderhawk missiles are made by raytheon and cost 359,000. 359,000 to fire one missile. They can carry six missiles. You do the math. Per plane, wow. Target expensive to do practice. Haider alibadi putting together a cabinet. Standard chartered close to a million. 300 earlier this month, Standard Chartered was expected to be fined over the antimoneylaundering control. Standard chartered, like a few other banks, is a Truly International bank. Servicing asia. Asia, africa, we have done all sorts of work with their team of economists. They were kneedeep in the united arab dubai, emirates, singapore, etc. Pricewaterhousecoopers also paying 25 million to new york regulators. You were covering this on the radio. Arthur levitt, former sec chairman, was really quite eloquent about what Benjamin Lawsky is doing. He runs the insurance department, he is the financial voice for the state of new york. Mr. Lawsky is making a splash. Sachs goldman representative ahead of the chief office, probing from the new york head into how Deutsche Bank is reporting financial information. So many years after the crisis. Lets continue. Away from the economics, finance and investment. Files overnight in ferguson, missouri. The st. Louis suburb as National Guard forces guarded police barracks. Bloomberg news reports about 50 demonstrators in attendance. Also in attendance, attorney general eric holder. What was the distinction at 1 00 a. M. This morning versus 24 hours ago . At 1 00 a. M. , the streets were mostly clear. I want 00 a. M. At 1 00 a. M. , there were defiant protesters taunting the police. After all of that, the Police Responded with pretty strong force. A lot of tear gas. It looks like a war zone. There was smoke in the air and teargas all over the place. It was a very disastrous picture. It is important that you are nd judge whath a i am seeing on social media and the mainstream media. The size of the press contingent versus the size of the event. These are important events involving the president and the attorney general. Size of the protest and the violence versus the reporting of it when you are on the street. There are dozens of reporters, more than 100, on the. Cene there are a lot of protesters during the peaceful part of the protest. When the protests became more violent, a lot of Peaceful Protesters left and the reporters stayed behind. A few defiant protesters and a large number of reporters. That is why you have that large reporter contingent and it looks like it is made even larger than the protesters that remain. Good perspective. The protesters have been calling for authorities to make an arrest and the shooting death of michael brown. Any update on that front . Still no charges are being filed. The local prosecutor is looking over all the details. The federal government is also on the ground with about 40 interviewing people and attorney general eric holder will be here tomorrow. There is progress but no charges yet. Last night was the first policen four that the decided to lift the curfew. Can you explain why they did that . Called in the National Guard. They felt that they had the strategy to make this a peaceful protest and not force people to go home. The curfew rarely led to some confrontation after midnight with cops the curfew really led to some confrontation after midnight with cops using teargas. They took that away but it still ended up with the same result of teargas and confrontations. Thank you so much, toluse ferguson, from missouri. We turn to what we will see it, theis week zip advice of Michelle Meyer of bank of Americamerrill Lynch. Chair yellen needs to get out of dodge without saying anything. Theeed to talk about American Economy and a bit. Why should janet yellen remain calm and quiet as she travels to william and . To william and to wyoming . She wants to communicate the core views of the fomc. The theme of jackson hole is the healing of the labor market. I think she will speak intelligently and offer some of the similar views as she has in the past. What she does not want to do is set a market signal. Both yellen and bernanke have made a lot of steps to try to remove some of the market focus on jackson hole. To the extent that they could. Meyer with bank of Americamerrill Lynch. Every jackson hole is different. One constant theme are very smart academic papers. Smart companies, here is scarlet fu. The Wireless Industry pricing. Come decision heating up. Sprint says it is doubling the available data in shared plans. It the share pack, framily plans are a thing of the past. Its fullyear profit forecast, rising on higher freight volumes and lower cost. Maersk plans to buy back shares for 1 billion over the next year. The copenhagen firm transports about 50 of the worlds containers. On a Foreign Company under sk,utiny in china, japans n the first Japanese Committee to be published amid an investigation into pricing. Coming up, we hear from the former microsoft ceo, Steve Ballmer. Proud owner of the l. A. Clippers. We will talk about that as well as his replacement at microsoft, Satya Nadella. Is bloomberg surveillance, we are on Bloomberg Television, streaming on your tablet, your phone, and bloomberg. Com. Good morning. Good morning, bloomberg surveillance. One of the most interesting guys in modern new york city raymond kelly, former new York City Police commissioner. Hisfather was a milkman, mother checked coats at macys. He became a force within new york city with his 11year leadership as police commissioner. Whatever you think about the politics. 11 00 a. M. This morning i market makers, really looking forward to that. This is bloomberg surveillance. I am tom keene. With me, scarlet fu and adam johnson. Scarlet, get us started on the screamer and she. Microsoft ceo steve balmer . He has a loud personality. He is the new owner of the l. A. Clippers. He made his debut yesterday. He sat down with trish regan. He is setting the bar pretty high for his new 2 billion investment. I want the clippers the best the clippers can be. The best team, the best players, the best character, the best coaching staff, the best business. I want all of that for the clippers. That just means were going to have to be hardcore about better, tenacious, more and more excellent in everything we do. Ballmer promising to be hardcore, you know he is going to be a handson manager. He is going to be paying some 4for million bucks million a year and they will spring their ankle, will he start screaming . That is what he does, he screams. Usually i think what is challenging in professional sports, the manager does not make as much money as the stars. Now you have an owner who can bear down on the players, too. Steve ballmer spoke about microsoft undersell siena dela. Satya nadella. A fantasticoff to start. It is a longterm gain. Businesses get built not in months, but in years. For six months, i love sougha tyas work. The truth is, it will take years before we know how well he is doing. Years to find out how well Satya Nadella is doing. Cisco,ft, hewlettpackard, enterprise first Tech Companies are dealing with amazon, apple, and google. He is rooting for satya, still the fourth largest shareholder at microsoft, he owns 4 nadella has been yelling and shouting. Courageous show, there it is. Show, there ist is. This is why we call him the screamer. [shouting] hes a salesman. Does this happen at bank of Americamerrill Lynch . Maybe one day, we hope. I am looking at this guy going for does he think he is . Having attended the walmart annual meeting where tom cruise made an appearance, hugh jackman made an appearance, they get fired up. Theres only one Steve Ballmer, he is the owner of the l. A. Clippers. Coming up right here on bloomberg surveillance, adam parker onset. Equity strategist at Morgan Stanley. Guest host on Bloomberg Television and radio. You are watching on your television, you might be listening on your radio or you could be doing so on your iphone, ipad, galaxy s 3. If you are using it, we are on it. We will be right back. Good morning, bloomberg surveillance. Futures of three, a little bit of risk on. Good morning this tuesday morning. Must get to our morning read. Scarlet fu pulled the short straw. Morning must listen from tiger woods. Erik schatzker sat down with the leagend to discuss the future of the sport. Participation is hard. Other top see athletes, say i am Michael Jordan, play golf. Even Stephen Curry has good game. Other athletes have played golf and have played very well. That is where you can make off cool. Many competing with so other distractions for young people, can you imagine taking out four hours on the golf course and not tweeting . Twitter, you do something in 140 characters. Hours, you have got to drive there and get back, it is like six hours. This is a huge deal. To do with sports, music, art. Meyer, this is a huge deal and economic study. Hown general, it is about opinions ofnd cohorts are changing. What thea view of generation looks like and what it means for the economy. We will be back with Michelle Meyer and why she is optimistic. Morning, bloomberg surveillance. I am tom keene. With me, scarlet fu and adam johnson. A risk on data check. Not like yesterday, but up, up. Futures up 3. Point 37 . Ld at two the linking of equities and bonds. Eurodollar 1. 3 352. Nymex crude and brent, south. Housing at 8 30 this morning. She describes housing as good but not great your coat sales up but prices are flat and millenials are still living with their parents. Michelle meyer, amid all the noise and the conflicting signals, what matters most . Rememberk we have to when we think about the housing recovery, it is a gradual recovery. On the end focus result. People living with parents, people doubling up. What is the trajectory of household formation . I am in the camp that household formation has been artificially depressed by the week pace of the recovery. Not a permanent slowdown. We will ultimately see some rebound. When that occurs, we have to build in order to accommodate the increase in households. I think we will see a high homebuilding, it is a function of the slow progress of the recovery. And then thethings inside things, is the recovery of the last three years exogenous foreclosures, rich guys buying houses . We are waiting for the normal housing recovery. Theres been a lot of special factors. When you think about the initial stages of the recovery, it came very much from investors buying distressed properties. Eople who purchase properties in order to see the real momentum build, you need to see the typical feedback loop, people have access to credit and they look to buy. It is happening slowly. This is the conundrum now. While we wait for it to happen, here is existing home sales, right back to where they were five years ago. The price of an existing house is near where it was in 2006. Problem solved. That took haves advantage. The caseshiller price index is still off the high. Never let the facts get in the way of a story. At was we were looking median home prices from National Association of homebuilders. There will be sampling skews and the fact that more of the homes are sold to higher end. The case schiller index is an arms length transaction, probably a better read. Home prices have seen a pretty nice pop higher since those lows. How big a presence are Institutional Investors in housing . They have for good, been pretty quiet, what would it take for them to get back in . I think the reason institutional buying has calmed down, the share of distressed transactions has come down. You do not have the same amount to purchase. For Institutional Investors to buy properties to get into the market, it has to be the right type of purchase. One where you can buy in bulk. And that there is a rental market for those properties. Endgame for a lot of these Institutional Investors is to buy distressed properties, renovate, and rent out for a period of time and get that return. You are not seeing as many of those purchases. Could they leave in exodus . Good question. Right now, there has been a conversion to ownership to rental from the Institutional Investors. But what is the ultimate plan . Either looking to sell the property once home prices get to a certain level. We have heard anecdotally that a lot of investors are in it for the longterm and aca trajectory for rental. To a fair extent, that makes sense. Going back to the people now that are graduating college, 48 for a period of time, they will rent before they buy. People will be in starter rentals before they buy. Housing starts and building permits, over the past two months, each has declined. This morning, we are expected to get a rebound. Is this noise and we should try not to look at monthly data . We should look at monthly data because it is high frequency. Housing statistics on a monthly basis are incredibly noisy. Monthg at the three moving average to get the trend. Components, you can get swinging at 30 a month, it will likely be a payback. There are a lot of special factors so you have to be careful. See as a sell side analyst, if you talk to them, is the kind of house we are going to buy in the future differently or are we just going back to 2004, 2005, we argued about the granite countertop. People are making homes out of container ships. Its cool. You would know that. Is it the same housing economy of 2004 and 2005, do we all want eight veterans and granite ght veterans ei and granite eight bedrooms and Granite Countertops . People still want nice appliances but there is a shift towards urbanization. Maybe you can have a smaller property that is closer to the city center. The big road for Toll Brothers is building apartments. Right up that lexington avenue. The urbanization, a onebedroom halfbath. As we anticipate a Federal Reserve rate increase in 2015, what is your projection of the rent versus buy cancellation . Isthe idea of what affordability look like. I think that we have to make one assumption, if and when we get rate hikes, it will be in the environment when the economy is stronger. Income growth is picking up