Norwegian wealth fund says it has returned from 2. 6 in the second quarter. They must have had a big position. If you are looking at the way that the Norwegian Wealth Fund is structured, they have a you look at when stocks, and then they have bonds. The Real Estate Holding returns them 1. 2 . They face many challenges. That is something we need to keep an eye on. Lets get on to the rescue of your data check in. This is what i am seeing overall. The markets are on a little bit of a rebound, especially for stocks. It is august 22. European stocks are joining the rally across most of asian equities, following three days of losses. Trading volumes, once again depressed. Even withreating, ray dalio saying he has reduced risk. Reporter the command review u. S. Forces are confident in the ability to destroy north korean missiles. Pyongyang threatened the United States with merciless revenge for carrying out annual military drills with south korea. Steve mnuchin says President Trump could keep the tax breaks for military, while eliminating it for others. Trump highlighted it to during his election campaign, labeling some Hedge Fund Managers as paper pushers getting away with murder. The u. K. Government will publish its third position paper in two days on how it sees its future relationship with the European Union. The latest details focus on civil judicial operation. Meanwhile, irelands Prime Ministers as britain seems to be suggesting it wants all the advantages of being in the eu, but none of the responsibilities and costs. Where we are confused and is, what trade agreement does the United Kingdom want with the European Union . At the moment, they have the best trade deal possible and imaginable, which is a Customs Union and access to the single market. Reporter and a total Solar Eclipse has wowed large parts of the United States. Cast over the and swept the country from oregon to have carolina. Millions of people watched the totality, and event that has not happened in the continental u. S. Since 1979. Global news 24 hours a day, powered by 2700 journalists and analysts in more than 120 countries around the world. Im nejra cehic. This is bloomberg. Francine President Trump has announced an openended commitment to afghanistan that will put more american troops into the nations longest lasting conflict, and he pledged to keep u. S. Forces there as long as it takes to bring about a foot ago settlement with the taliban. Donald Trump America will work with the Afghan Government as long as we see determination and progress. However, our commitment is not unlimited. And our support is not a blank check. During the election campaign, he grudgingly big knowledge the need for the u. S. Presence there, and promised to avoid military entitlements to focus resources at home. Lets get more now with our u. S. Congress reporter, kathleen hunter. Also joining us is patrick armstrong, who will stay with us for the hour. Lets start with you. What was the press conference like yesterday . What does it mean for the gop . This is certainly a potential rallying point for republicans, who have been really divided over, you know, trumps response to the charlottesville incident. I think that we saw paul ryan doing a townhall after the president s remarks. The applauded the president. There has been a lot of widespread calling on the republicans. Is definitely, when it comes to Establishment Republicans and republicans in congress, this is potentially a rallying point, but the interesting factor to watch is from the breitbarts of the world, the more conservative wing of the party that tends to be more isolationist which was happy with Donald Trumps america first, we wont be doing nationbuilding, they were happy with that rhetoric during his inaugural speech. This is a dramatic departure from the. I think that will spark backlash we are already seeing from that faction of the party. Francine you mentioned paul ryan, the house speaker. Speaking during a cnn townhall event, ryan said the president should have handled the charlottesville incident differently. He messed up on tuesday. He was right on monday and he was right about one hour ago. When he was reading from a prompter . Francine does the president need to apologize, loror is he more on track . The odds of the president apologized are probably pretty slim. We are seeing an effort my the white house to change the conversation to make it more about foreign policy, the president , and other domestic issues. The president will be going to arizona and talking about immigration down there. That is another potential issue where we could see him trying to rally support among the republicans, where that support has been lacking since the charlottesville comments. It is wroth it is worth noting, with paul ryan, this is one of the many statements he has made about his handling of the charlottesville incident. Each time he talks about it, it seems his comments are getting stronger, but still, some would say, maybe not strong enough. This is the first time he has said something as strong as trump has messed up, but there are many, in the Republican Party and outside, that would like them to issue stronger statements. Francine charlottesville cost trump some significant support and it seems some have not given him overnight. The Goldman Sachs ceo tweeted, wish the moon was not the only thing casting a shadow across the country. One, wet trhough will get through the other. Kathleen hunter stays with us. When you look at this, what does it mean for the ability to get tax reforms . What will he look for, as to indications . He will need a sustained period where he does stay on message, where he does not create sideshows, where he is fighting the media. Give then message will markets confidence that there is potential that we could get something through. His popularity ratings being so low, it is easy for the republican matters for not supporting what he does to talk out. If he stays on script, it is much easier to get congress in line. Its a big if. Francine how much time does he have to stay on message for . Im not being facetious, but is it two weeks, three weeks . He has never done three weeks. So, if he does three weeks, maybe they will think this is something sustainable. But you have to keep going, though. If we get to three weeks, maybe there is credibility he will stay on message. We talked about the possibility of tax cuts coming through during the next month. The markets think there is no chance of that. If you cant get health care through, you dont have any budget to fund the tax cuts. They were hoping to get some savings there. You cant get anything through that is budget neutral. You have the debt ceiling coming up at the end of september. Right now there is no confidence that the infrastructure, the tax cuts, these types of reforms that were promised will even be in a position to be discussed with any likelihood of getting through right now. Francine kathleen, what are we getting this week . He is speaking in arizona today, and then what is the timetable . He is back to work now. He had a working vacation in new jersey that turned out to be more working and less vacation, in terms of the news he generated. I think one of the interesting things will be to get some of the tales about this new afghanistan policy as those tend to leak out. One interesting point, as you were talking here, is the president talked about initially the need to withdraw from international commitments, or international entanglements, because it would because they cost so much money. It is interesting, i think some of the questions will become how much will this ever cost . We have already spent trillions of dollars and 17 years over there. Money spent over there cannot be spent on things like giving tax cuts, reforming the tax code that will cost people less money, or health care and infrastructure initiatives. That bears watching. Francine thank you, kathleen hunter, the u. S. Congress reporter. Patrick armstrong stays with us. Plenty coming up. Including, will there be action in jackson hole . Plus, macron hits 100 days in office, but with his Approval Ratings plunging, is there much to celebrate . We discuss that next. Francine this is bloomberg surveillance and im Francine Lacqua. Lets get straight to the Bloomberg Business flash. Reporter bhp billiton has bowed to activist investors. The company has unveiled plans assets its u. S. Shale and will delay a multibilliondollar investment in a canadian project. That came as bhp announced profit that missed estimates. Anofagasta said profits gained by 42 . Shares in Provident Financial have fallen by the most on record this morning. That is as the ceo stepped down with immediate effect. They forecast a full year loss. The plans to replace workers the technology backfired. That is the Bloomberg Business flash. Francine with little significant Economic Data out this week, investors are awaiting the meeting in jackson hole, wyoming. This gathering comes as central exitingeep up towards years of unprecedented easing. Yellen is expected to reiterate her plans to raise rates. But how will bond traders respond to this language of moderation . Still with us, patrick armstrong. Patrick, i saw a great bloomberg story that was basically arguing, the matter what janet yellen does, it is unclear if the bond market will listen to her. What does she need to do to be listen to . I dont know if she is in a position to be listen to yet. I think she will have to wait for a few more months. Just with the economy moving in the direction it is, inflation is the missing ingredient. So, she probably wont want to be raising rates yet. I think the market is too complacent. We think thats probably more than 50 . I think the narrative will be that Financial Stability will be the topic. And you need a fed that has some drive. You cant have Interest Rates as low as they are. If we have a slowdown were the fed must come to the rescue again, they are not in the position to do so. So, you think she will focus more on Financial Stability than actual inflation and argue inflation will at some point feed through . That is her view and there is a clear debate in the fed. If theres longerterm factors that will keep prices lower. You also have to wonder, should the fed be looking at inflation if the disinflationary forces are coming through, the Amazon Effect . But its not coming from the usual negatives with disinflation. It is a positive form of disininflation. The fed should not be fighting that, necessarily. You might not want to look at the headline numbers the way we have had in the past. Francine patrick, talk to me a little bit. The charts look at the 10 year yield in white and the cpi and the u. S. Breakeven. If you think the market is not wellpositioned for a hike, what does that mean for the 1 10 yea r . I think the 10 year rates will move higiher. Will move higher. Im of the camp where the phillips curve is not dead. It is astonishing the things Small Businesses are worried about, about the quality of labor and the difficulties who fill job openings. Those are leading indicator to higher wage growth, i think. Once you have higher wage growth, inflation will be the followthrough. Unemployment has dropped to levels, where people are arguing the phillips curve is dead. I dont think so. I think we will see wage growth, and inflation as well. I think they will do another two or three rate hikes next year. Ishink the cyclical backdrop quite good, as long as we have an administration that gets through some of the things we have talked about. They should be on track for one more this year and two to three next year. Francine patrick, when you look at what the next fed chair could do, do you think they will be less likely to look at inflation as one of the key measures . It is still a mende, but you could interpret. It is still a mandate, but you could interpret. I dont know yet. We will have to see what the backstory is. Inflation will always be a key measure, whether it is the only measure, that is open to question. It is a good question. Undueic Growth Without price rises is what Central Banks are trying to do. Muccine patrick, thanks so h. Patrick armstrong stays with us. Up next, as Emmanuel Macron marks 100 days in progress, why his ratings keep falling. We discuss that next. This is bloomberg. Francine you are watching bloomberg surveillance and im Francine Lacqua in london. Over in paris, Emmanuel Macron is marking his 100th day as frances president. The original market euphoria appears to have passed. As he grapples with a number of challenges. Still with us, patrick armstrong, the managing Investment Partner at plurimi. My concern is, everything is closed in the summer. Hes talking to a couple of labor market participants, that we need to see what is in the reform. Is it too early to judge . It is too early to judge. The first 100 days for macron, he had the parliamentary election. His popularity has really fallen. I think it would have been hard for anyone to hope something had happened by this point. There was a bit of euphoria on the macron win, but probably as much so as le pen was removed. We saw a relief rally from that. France underperforms until the middle of may. And that is the euro, as much as it is anything in france. A strong euro is a negative for france and germany, particularly. Anything in you buy france . The french banks are very much attractive with 4 dividend yields. Those are very attractive valuations. We have investments across the eurozone. We think europes on a sustainable recovery right now, being tendered a little bit by a strong euro. Any weakness in the euro, they will be another leg up in european equities. Francine this chart is looking at france. The gdp in white and the unemployment i think it is the other way around. What does this tell us about what draghi can do . This is about the stress points in italy. What mario draghi can do . Francine yes. Thats almost when he is going to try to do, to say the euro is too strong, without using those words. Ia 4 move from the beginning of the year is quick for the euro and i think draghi will be in uncomfortable. But the eurozones economic backdrop is quite good. There are Structural Reforms. In europe, nothing happens quickly. If you start the discussion moving towards september, discussing with the union, small steps. Thats all you can hope for. Francine do you think the french access will hold . What does that mean for growth . I think it will, there is no reason not to. It seems that merkel will be elected again. Francine thank you, patrick armstrong. Up next, as the eu insists on an orderly brexit, the irish Prime Minister says he remains confused and puzzled about britains plans. We have our interview with him next. We also have a nice little data check. 0. 6 . S the ftse, gaining this is bloomberg. Francine this is bloomberg surveillance. Lets get straight to the bloomberg first reviews. President trump has announced an open ended commitment to afghanistan that will put as many as 4000 more american troops and to the nation boss longest lasting nations longest lasting conflict. Only grudgingly acknowledging the need for u. S. Presence there. To focus resources at home. America will work with the Afghan Government as long as we see determination and progress. Commitment is not unlimited and our support is not a blank check. Nejra the admiral in the pacific is confident in the ability to destroy north korean missiles. This comes after pyongyang threatened revenge for carrying out military drills with south korea. Steve mnuchin says President Trump may keep the tax breaks for firms that create jobs while in eliminating it for Hedge Fund Managers. The loophole enabled managers to pay a tax rate as low as 20 , roughly half the top rate for ordinary income on much of their income. Trump highlighted that during his campaign, labeling Hedge Fund Managers, as getting away with murder. The u. K. Government will publish its third position paper in two days with how it sees its future relationship with the eu. They focused on civil cooperation ahead of a document tomorrow on the role of the court of justice. A total Solar Eclipse has wowed the United States. A huge shadow cast by the moon as it passed in front of the sun swept across the country from oregon to south carolina. Event thattched, an has not happen in the continental u. S. Since 1979 and had not covered as much of the country in nearly a century. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. The Prime Minister has told bloomberg he remains confused about the u. K. s Global Trading plans after breakfast after brexit. The clock ticks down and the remaining 27 nations of the eu are not satisfied so far. I would be right to say on behalf of the european government, we are not satisfied with the progress so far. We will continue in talks. They are ongoing. We will allow those talks to continue. We hope that more progress can be made. That progress will be sufficient when we meet in october to allow the talks to continue to the next raise. To date it has not been sufficient. On particular top