>> before tom kolman. >> before tom kolman. >> same day? >> same day. i looked at this person and said, "kind of always thought that was a sterile environment." and she said, "well, you should give that a check." so, we did. >> sure enough they got a match. turns out the dna belonged to the deceased male who'd been on the medical examiner's table before tom. so the dna had nothing to do with the case, but it did mean that some evidence had been contaminated. >> what are you thinking when you hear that? >> well, i'm thinking a couple things. i'm thinking, "that's gonna be a problem at trial because of the contamination." but i'm also thinking, "thank god, we get a little break. >> and after all the additional testing, the medical examiner finally had a cause of death, acute midazolam poisoning. investigators took everything they had to a special prosecutor and argued they were sure gilberto nunez had killed the man he called his best friend. >> i don't think that nunez was ever a friend to kolman. not for a minute do i believe that. he is a master manipu

tom: well explained. demographics and population with the history of your institution, if we assume a assumenominal gdp, if we a more dampened economy, why don't we just lower the 2% target to 1.9% or 1.8%? when i do that? bill: the reason why the fed wants to have an inflation target of 2%, not lower, is they want to have enough room in an economic expansion to have the nominal interest rate high enough so that there's enough to stimulate the economy and get the economy out of recession. let's say the inflation target was zero. in the short term fund rate at the end of the cycle would be 2% or 3%. there wouldn't be much room to cut rates, and therefore there wouldn't be much way to stimulate economic activity. lisa: with fed chair jay powell essentially writing the obituary for the phillips curve, this relationship that was previously believed that could get an limit lower that would lead to a rise in inflation. bill: i wouldn't say it is quite the obituary, but now saying we will focus on inflation to g

tom keene working his magic in getting that fourth decimal point. well done, tom. tom: it's fun. this is the way the street looks at it, folks. jonathan: you explain -- can you expand to our listeners what they are missing out on? tom: years and years ago, it was a reach to go to three, but the street, particularly with the new low rate regime, constantly quotes four decimal points. jonathan: tom keene has been complaining about this for the last 10 years. tom: these are roman numerals. we like to go cross asset, and also in detail. right now, we go to kevin cirilli, our chief washington correspondent. the silence in washington last night was the president's list of approved debate moderators. i'm fascinated by the president's demand, and frankly intelligent demand, should we have a debate before the mail-in voting begins? that makes a lot of sense to me. how should the democrats respond? early in terms of the voting in mail-in voting, that is precisely the argument that the president's reelection campaign is making. anywaye encouraging possible for there to be an additional deba

tom: thank you so much. just a stunning analysis there of the what if's out of a lack of stimulus, or if we do see stimulus again. it will be one million, as the survey. right now we are 35 minutes away from this important claims study. lisa: the prediction mark zandi just came out with is stunning and sobering, and deeply concerning, the idea that this will be looked back upon as a great depression. if you have double digit unemployment all the way through the end of next year, what does that do to new graduates? what does that do to young people just coming out of college and trying to enter the workforce? tom: i want to emphasize that a a depression is not defined within the definition of recession. the word depression has a life of its own, like the word reflation. it is somewhat undefinable. what i would point out is if there were a number of byressions identified the 1930's, there was a more vibrant oppression in 1929 and into 1932, but we enjoyed a whole other kind of recession -- depression, rather c

tom: mr. kushner now speaking. i'm uncertain what our feed is right now. , andis abu dhabi again this is the oil community of uae, where dubai is much more visible. a good way to partition this is dubai is emirates air and abu etihad air.ut -- is have an important discussion. we do that with sebastien page of t. rowe price. your hugely anticipated book out in november, this has been a huge theme of my work here recently. are we over diversified? to the heart of your book, are we too diversified and diffuse in our potential return? tom: i don't think we are --sebastien: i don't think we are. in fact, to me, diversification fails exactly when we needed it the most. we've just lived through this during covid. you know this, most investors know this, but in the book, i argue that the magnitude and the prevalence of the failure of diversification is very much underestimated, even by investment pros. every time we get a crisis like the one we just had, a big market selloff, people seem surprised tha

tom: thank you so much. our commitment here from the beginning of this in february and into march, the science on "surveillance." this is our data check on the move. we aredoesn't color what seeing with gold, now up $11. i am noticing some real currency market meant as well. this of thedxy week dollar -- dxy weakness of the dollar giving back a little bit. lisa: talking about the incredible flows of money into gold and silver etf's, this sort of hot money creating concern about pretty big ups and downs in an already boom and bust prone area of this commodity market. i do wonder how much that was underpinning gold, surging above 2000. two drumsnded up with of oil you went long on. that is why you went away for two weeks. i would expect you to have a couple of bars of gold in the living room when we are all done. [laughter] lisa: well, i wasn't the one who went to tiffany to pick some up. tom: fortunately they are closed, under construction. that is a beautiful thing. turkish lira, 7.36. we are watching that c

tom. good morning, i think europe at the moment in somewhat better shape than in other parts of the world. it has a better control of the virus dynamic. response also seems to come together more than in other places, and there is more visibility about the fiscal availablehat has been . that looks fine, and then if you look at the number of long-term trends that will be accelerated pandemic,k of the notably a clear shift toward , addressingty things such as inequality, i think there is reason to argue that europe essentially is in a decent position. to benefit from these trends. tom: is it a decent position of actual improved labor productivity, or is it an overlay of maybe good policy like europe? can europe jumpstart labor productivity over the next five years? elga: in terms of the productivity trends in europe, it is important to understand the labor productivity trends that we had over the last couple of decades, or i would say 1.5 decades, maybe two, was on the back of europe's finall

can you make sense of that, tom? tom: the bankruptcy part is really important. swonkd go back to diane and just the sheer hardship that is out there for x percent of americans out there right now. there's just nothing going on in washington. i am frankly not looking to the end of august. i am trying to get to the third week of august. jonathan: we will try to get you next week with henrietta treyz veda partners. -- henrietta treyz of veda partners. this is "bloomberg surveillance ." says hepresident trump is seriously considering a capital gains tax cut. he told reporters it would create a lot more jobs. president can't cut taxes on his own. some advisors say he could issue an executive order that adjusts the original purchase price of an asset when it is sold, so no taxes paid on appreciation for inflation. the trump administration reportedly may temporarily prevent citizens from returning to the u.s. if there's a chance they have the coronavirus. according to "the new york would applyban to permanent residents, too. in seattle, the police chief has resigned af

two boys, tom jr. and john. while not posing as a working farmer himself, he has a wide knowledge of agriculture, understands farm problems and enjoys discussing them with his neighbors. as governor, he has taken vigorous action in giving constant aid to farmers in their fight to improve livestock and crops. during the war and since, governor dewey's food commission has helped farmers increase production and fight food shortages. york, deweyof new has won his place among american political leaders through his record of good government during the past six years. for the great state of new york with its normally diversified areas ranging from sparsely centered rural districts to the world's number one metropolitan center, it is almost a nation in itself. the job of governing it is second only to the president of the night states. by running his state with so much division see that he was able to increase services while cutting taxes, he won the confidence of the people of new york. he returned to albany

tom: it is. it is really remarkable what we are doing, however behaviors change in pandemic america. lisa: it turns out having a big box with stuff and it is actually helpful, which brings us to how people are positioned right now in the markets. one thing people have been focused on is the short positioning inequities and how that has come down dramatically with yet another bear in the market, throwing in the towel. what do you see in terms of positioning and the amount of bearishness currently priced into markets? stuart: generally speaking, the trade for the last two years was to be in a relatively safe portfolio. i think the starting point was not an overly aggressive type of equity exposure, so to me it is not too surprising to see people not hedging as much as you might expect just because they don't own what you would consider a risky asset. if you look at how downside is priced into derivatives markets, it is not particularly out of line right now, and not to extended. that should be a go

tom? tom: coming up a timely conversation in the 8:00 hour. mr. kaplan of the dallas fed. there is so what's going on, including the markets telling the fed what to do, this new lower weight regime that we see. robert kaplan in the 8:00 hour. this is bloomberg. good morning. ♪ tom: good morning, everyone. "bloomberg surveillance." the jobs report way out there. at the end of the week. it seems a million miles away. kaplan coming up from the dallas fed in a few hours. arvind barth from barclays joining us. i want to tie in on something that last week i think we really underplayed, and that is emerging markets, fiscal and fx dynamics. we know the argentinian story. i think people have a good grasp of turkey unraveling, but as a general statement, what is the knock-on effect of a developed economy slow down on e.m.? there isell, i think actually several different things going on here, tom. we talked about it before, this idea that actually with the advent of increasing automation and ai, we

tom: thank you so much. jeanne zaino as we look at the republican national convention again, not a clock p.m. tonight. -- again, 9:00 p.m. tonight. david westin with our coverage. futures improve a little bit. we will look at a little micro move here. lisa: really interesting to see the continuing claims, how much fromhe people on ongoing the government, how much it is going down or not. currently the expectation is for 14.4 million planes. let that sit in. what carnage we have seen in the jobs market this year. tom: i must admit, the disparity between equity strategists optimistic, including what we heard from alicia levine and economists, they are just miles apart. a nice tweet out moments ago, talking about the separateness of stockmarkets from what we see within small business america as well. what else do you see in the bond market right now, besides the real yield, -1.05%? lisa: it raises the question about how low actual yields can go at a time of rising inflation expectations. we are expecting fed ch

tom: yes. jon: in the next hour on policy and demand that thinks we might get a $1.5 trillion package, isaac from compass point will be coming up later this morning on bloomberg tv. tom: do you want to see the real yield. jon: maybe thursday. you will be off. tom: i'm off? and wednesday, thursday, friday. maybe i will tease real yield on tuesday just for you. this is bloomberg. with first word news, new polls show biden leading president trump in key battleground states. according to the cbs news poll. president won both of them in 2016 by a wide margin. president's handling of the coronavirus was a major issue. another coronavirus milestone to added a million new cases in a little more than two weeks. the positive test rate will hit another record. news 24 hours a day on air and on bloomberg rick take powered by more than 2700 journalists in more than 120 countries. this is bloomberg. ♪ >> the problem with qe is that it can only go so far. and there is only a certain amount that you can buy

tom: i would agree. what has changed in the last half hour's we have seen the -1.02.eld breakdown, not a big deal, but the trend this morning off durable goods and durable goods reversion better has been a steeper yield curve, and with the nominal yield where it is in inflation expectations of real yield. we will give you more on that as we can. this will be fun. salesforce. of out of a small apartment years ago. he is now a dow component. lined up with emily at 5:00 tonight. marc benioff on the dow jones industrial average. this is bloomberg. good morning. ♪ ♪ from new york city for our viewers worldwide, i am taylor riggs in for jonathan ferro. the countdown to the open starts right now and we are 30 minutes until the opening bell, trying to extend some of the record highs we got yesterday. better than expected orders. that does not seem to be moving the market much. you are catching a selloff on the 10 year yield. 71 basis points catches my attention. that is near the high end of the trading range

tom: tom keene in new york. thrilled to have you with us today. you had a book out nine years ago, "politics and strategy," which is absolutely must-read. in it, you have an extremely important chapter on herbert hoover and the others of strategic retrenchment. thatu just anticipate president trump will retrench around his comfortable majority? peter: yeah, so that argument was about presidents, of course, that retrench internationally, which is frankly what i think donald trump has done. yes, trump'sk, strategy is to play to his base. they believe that it is he and his team -- he and his team believe that there are trump 2016. who did not vote in these are white, blue-collar outrs, who can be brought in the key swing states. that is what he's doing. that's the strategy. i think it is a high-risk strategy because it is like trying to pull an inside straight to use that phrase, a second time. but he did pull it off one time in 2016. tom: what is so important here is the definition of the 2020 silent majority. how does vice president biden not do st

i called tom. i told tom, the door's locked. and he said he would call his mom and get back to me. >> reporter: and according to schrauben, tom called back within minutes with a backup plan. >> he told me his mom was going to go out that night and that they needed it to happen tonight because his mom can't take it anymore. he said we didn't do it tonight, his mom was going to do it. >> reporter: they returned that night about 9:00. schrauben's stor by was he dropped his friend off and drove around the neighborhood while his friend snuck inside and stabbed jack jessee to death. >> we had walkie-talkies. afterward he called when he was done and told him to pick him up. so i'm turning to go back. he had a little blood on his legs. we looked for a place to clean himself up. i believe there was a del taco place. there he went inside to clean himself up. >> the information he provided, if we could corroborate what he said, would blow the case wide open. >> t.j. garrick was questioned and denied everything. he said he wasn't in the car

tom: i am sorry. my head is spinning with all of these numbers in you're doing a great job translating this. lisa, can i steal your insight? what is important is the lisa abramowicz question, who cares about pce deflator. we are all living inflation in i four and paychecks. michael: inflation is interesting to watch because of the fed situation and what is going on wall street. the fed is concerned if inflation gets too low, which is why they have been watching this number with the hearts in their mouths. they did not want to get into deflation because we have had a big demand shock. now the question is how fast can we get into a supply shop area where goods are scarce -- a arely shock where goods scarce and we see inflation start to rise. until we get more data. we get a summary of the spending numbers. disposable personal income up only .2%. incomes went down in the month. we had been getting a lot more incomes because of the transfer payments, but at the end of july that went away. disposabledea of

tom: but mr. biden, the criticism is he's been in the basement, and maybe he is being quiet and letting mr. trump tweet, etc. do you sense a shift in the biden campaign this week? is that something we should look forward to or anticipate? kevin: yes, just the fact he is -- toto pittsburgh at pittsburgh is an indication he has to get back on the campaign trail. at the end of january, when the president restricted travel from china, and terms of taking a type ofe wait-and-see approach, and terms of their comments, it is not just on race. we also saw it on the coronavirus in terms of their comments and how they have been much more calculated or measured, depending on which party you are in, for the response it best for their responses -- for their responses. tom: el al descends into abu dhabi. explain this moment for jared kushner and his father-in-law. kevin: jared kushner is coming off of the most significant inicy win in his career public service. if you look at the normalization of ties between i

tom: that is diplomatic. leon: i made a big mistake when i got my stock when they went public i gave it all to charity. what is so important is this experiment of trying to do investment banking, trying to do investment research and strategy as you did and goldman sachs asset management, and also trying to be a bank. do you think that can be a successful strategy? i am sure if goldman sachs pursues it it will be a successful strategy. what can i say? i do not run the shop. when i was there we were private partnership. we used to laugh about the banks. then what happened during the financial crisis in 2008, they were forced to become a bank to survive. they will go with the flow. when i was there they were very reluctant to get into money management. now they are in money management with two feet. they adapt to the environment, they are smart people, they are good people. tom: jerome powell will speak at jackson hole this week. tell me how you perceive the interest rate structure the fed has set? what has the

tom: thank you. countable. frances: this crisis moves so quickly, so all of those alternative data points that we are now all talking about , that data is so much more important, and what we witnessed about mid april is that movement in the ultra high-frequency daily and weekly indicators are what gets markets markets'e what get attention. our people moving around and stores are open, but what is their confidence level? do people feel confident? the demand side of the picture is also much more difficult to count. we have to move away from those traditional data points and look at new ones. it is very uncomfortable for economists. it means we have to change our models and forecasting process, but we have to do economics differently. jonathan: i can hear the concern in your voice. . it is palpable. can you walk me through the structural damage you are worried about right now? what i see ahead it's we have to trade on our three month, six month basis. it is the long-term portfolio i spend a lot of time thinking ab

tom: good morning, everyone. simulcast on bloomberg radio, bloomberg television. lots going on here, including jon ferro and lisa abramowicz out, and only one person can replace the two of them. that is anna edwards in london. we are thrilled she is with us today. off of the fed minutes, the markets adjust, and they readjust back today. steve engle at standard chartered with a blistering note about the fed minutes being reinterpreted. we've got some breaking news. i don't know if you see it there i home in london, but this is critical. alone,leaves the rate and we get turkish weakness of that headline. mr. erdogan simply doesn't want to raise rates, does he? anna: absolutely. they are leaving their one-week repo rate. the big picture here is that many economists saw this coming, but also thought the turkish central bank should hike rates because the interest rate in turkey is well below inflation, and that kind of makes turkey stand out on a number of measures. they are also spending fx reserve

anna, tom francine: tom: thanks so much debt tom. tom: thanks so much. doldrums in the market. renminbi comes in stronger today, really breaking down. 6.89 right now number of yuan per dollar. see is a big deal to strengthening chinese or nimby. here is the equation. a little bit of wednesday math. the nominal yield is higher, inflation expectations are higher as well, and equally, so the real yield, the residual of that is the same, -1.01% right now. inlived in the yield, a lift and inflation expectations and that gives you a stable real yield. was that too much math, anna? anna: never too early for a little wednesday math update. i have got the response we are seeing in european markets to confirmation of an extension to the furlough scheme that we have seen in germany supporting those employed in businesses that have been hurt by the pandemic. they have extended it for another year commotion significant. does it set a precedent for your -- year, which is significant. does it set a president for europe?- precedent for the euro weaker as well against a flat dollar this morning

tom: ritika: i think that's very true ash tom: i think that's very -- tom: i think that's very true. jonathan: do you remember of the night of the brexit vote? tom: it is a blair. [laughter] jonathan: coming up on this program, john ryding of brean capital. this is bloomberg. ♪. ritika: with the first word news, i'm ritika gupta. president trump may take executive action if congress can't agree on a new stimulus package. he imposed he might impose a moratorium on- a uninsurance payments -- he might impose a moratorium on evictions. tiktok in the scale of -- the money would come from china or from an american buyer such as michael soft. the buyer said tiktok would have to close unless an american company buys it. hurricane isaias was downgraded to a tropical storm as it made landfall and moved inland over north carolina. it has prompted tropical storm warnings all the way into maine, .ncluding manhattan the storm doesn't pose a threat to major oil refineries or platforms. bp has cut its dividend for the first time in a decade. that removes the cornerstone of its investment case afte

tom: one final question. i was thunderstruck at a cautious james sweeney the last time your wonderful chief economist was on with us. i had never heard sweeney so cautious. that is confirmed today by the statistics out of france as well. are you investing based on sweeney's caution? jonathan: first of all, we talk all the time, and people don't always agree on everything. right now we are seeing the world the same way, that the doubts that we've had to come of this v-shaped bounce off the bottom is going to start flattening out as we go into the september-october timeframe. we believe you are going to see more data start to roll over, and we saw that for example with the jobs data yesterday on the unemployment claims. it has really stopped coming down. the improvement in the jobs situation has kind of flattened out. we think we are going to see that. james is a big proponent of the idea of industrial production, that the industrial data which bounced really hard off the bottom is going to stop improving on a

george: we look at both, tom. the challenge with fixed income now is that traditionally you would get two things out of fixed income. you would get stable income and a conservative or folio that offsets some risk in the equity markets. the challenge right now is that you are going to have to choose one or the other. you are either going to get the offset to risk, or you are going to get the yield. look at high-yield in emerging markets. you are balancing both of those, but to your point, you compound that challenge of low rates with the idea of real rates now taking back lower, with inflation picking back up, and also you compound that with the idea that duration has actually been picking up in assets, so the last five years has gone 228 down to 114, so the challenge is you are getting more risk and less income. rusnak all jargon this morning out of wells fargo. he says, we are all going out 15% longer than we thought we would go out. that's because i bought that 100 year austrian, looking for the payoff somewhere

tom: good morning, everyone. jonathan ferro, lisa abramowicz, and tom keene. it is a simulcast, bloomberg radio and bloomberg television across this nation. it is not a usual august. it is highly unusual, different from 1998. certainly some of these trends are draw dropping -- are jaw-dropping. bonds participate. it is decidedly risk on. lisa: although you have to say, when you got a 10 year yield below 1%, to say it is a decidedly different tone with yields going up indicates just where we are in this cycle. i will say, also important to note that is yields rise, bond prices down, you are seeing real yields remain deeply negative. tom: deeply negative and plunging right now. -1.00s the right word, at and now at -1.03 on the u.s. ten-year. that is a really extraordinary drop. saw,own near the lows we but this will be a huge theme. what will you listen for from chairman powell on thursday? lisa: basically, how much they are going to keep yields low and how much they perceive themselves looking at the reality of the economy today. i really think it is important

tom: tom keene in new york. how do you define the bubble? there is a group there are saying this has bubble characteristics. richard: everyone looks at bubbles. it is a smart thing to do to look for bubbles. but they are obviously hard to spot in advance. right now you have a very strong story around technology companies. a real nifty 50 cents, a real economic story. but everything can get overvalued, and we are getting close to that level now. some of those companies being overvalued. technology story can spread widely and go on much longer than people think. tom: what is the timeline here? hooper,as well, peter wonderful chief economist at deutsche bank says, look, no vaccine, no stimulus for the recession government like a 1981, in double-dip recession. what do equities do given a hooper scenario? richard: in double-dip recession would definitely see earnings revisions driving the market down very sharply. there is only really the discount rate and loose policy holding the ship up. i think you will see a spike up in volatility in the thir

francine and tom? tom: we are committed at bloomberg surveillance to having medical professionals speak to us about the virus. every once in a while and this pandemic, you have to listen to the politicians speak about the virus. >> to everyone that supported other candidates in the primary and to those that may have voted for donald trump in the last election -- watching new york get ambushed by their negligence and watch new york suffer. today, six months after it began, the nation is still unprepared. we had a national strategy. everyone who needs a test gets one for free. everyone has access to a safe vaccine. >> more than 150 thousand people have died and our economy is in shambles because of a virus that this president downplayed for too long. >> the truth is, even before trumps negligent response, too many hard-working families have been caught on an economic treadmill. tom: we go to the experts. one of them we spoke to a few at theas pamela university of manchester in the united kingdom. esteeme

tom? want to point out the disinflation on the data screen and go to the 10 year tips in america, breaking under 1%, negative one percent, i should say, a few days ago. now it is a -1.04. that is an extraordinary negative real yield in america. all of this heading for the jobs report friday. francine? and negotiations on the stimulus has become increasingly urgent with millions of americans left without additional aid. coming up, we speak with scott thiel, blackrock chief fixed income strategist. this is bloomberg. ♪ hike! simon pagenaud takes the lead at the indy 500! coming to the green flag, racing at daytona. they're off... in the kentucky derby. rory mcllroy is a two time champion at east lake. he scores! stanley cup champions! touchdown! only mahomes. the big events are back and xfinity is your home for the return of live sports. you say the customer's maklet's talk data.s. only xfinity mobile lets you switch up your wireless data whenever. i accept. 5g, everybody is talking about

. >> you must be proud of tom. >> i think everyone is happy that his success. he was always a worker. when he worked, he worked hard. when he played come he played hard. i do know he has the best interests of our country at heart. ♪ >> today he is governor of the most populous state in the union, tom dewey cherishes the moment he can relax on his farm in new york and live the simple family life so many americans know and love. at home in the out-of-doors from his own early boyhood tom dewey likes to take whatever time he can from his busy public life to spend with his two boys. ♪ announcer: while not posing as a working farm himself, he has a wide knowledge of agriculture, understands farm problems, and enjoys discussing them with his neighbors. poultry and dairy farming are major enterprises in new york state, and as governor, he has taken action to give constant aid to farmers. during the war and since, governor dewey's food commission has helped farmers increase production and fight food shortages which are at the root of high prices. as governor of new

thank you. >> thanks so much, tom. really, really terrific presentation, and and i think you did an excellent job of summarizing your book expect overall story -- and the overall story and really, really appreciate that. and i like the -- you have a dry sense of humor but also make points. and so i appreciate that too. as you said, adam smith was right. he just had very bad timing. and so he may be a very good economist, but he'd be a terrible investor, right? so now we're going to turn to our commentators. i would not call this group murderers' row even if they have a variety of different opinions. but if you were going to form a dissertation committee of the best expect bright who work on china's economy and financial system, this would be the group. and so this is a real treat to have them with us. let me briefly introduce them, and then i'm going to turn it over to each of them to allow them to offer a few minutes of commentary. joyce chang is the chair of global research at jpmorgan and is one of the leading analy

tom: tom keene here. jonathan ferro and lisa abramovitz are off today. joining us today is anna edwards from a simulcast. dow futures up 62. all the politics in america. milwaukee in a virtual convention. david westin leading our coverage on that. what i find absolutely interesting -- and i think london has done a better job of this -- is the shutting down of our economies. our coverage of the tourism in , all the beaches in the summer, how shutdown is london? anymore, all that much it has opened up, in theory. this is a services economy, and plenty of people, including myself, are working from home. in terms of the shut down, we have lifted a lot of the lockdown measures that had been in place. what is on my mind from a market nightclubs and aviation. those are really driving sentiment across the european continent when it comes to our freedom of movement. it is being eroded, perhaps rightly, because of the virus. that is not good for nightlife or the aviation stocks we see under pressure. tom: we have been watching the huawei story. before we get to jo

tom: no i do not. there is a difference between the conversation at the white house and the conversation of those disposing on capitol hill. you may get a change from mr. kudlow. jonathan: looking for to that conversation. 8:30 a.m. eastern, we get the jobs report. one hour later, we catch it -- we check in with. larry kudlow from new york city -- check in with larry kudlow. from new york city this morning, good morning. this is "bloomberg surveillance ." ritika: all eyes are on this morning's upcoming job report. after a surgeon coronavirus cases across the u.s., all signs point to a slowdown in job gains last month or worse. it is following a combined rise -- of 7.5lli million in may and june. negotiations on a new arenavirus relief bill edging towards the break of collapse. a meeting thursday between white house officials and congressional democrats ended with each side accusing the other of being unwilling to compromise yet the main sticking point is the top line number. the democrats want $3.5 tri

tom: a lot riding on yesterday. jon ferro was brilliant on the mathematics of nominal to real yield. get the ubs optimism, but how do i play it instead of just owning apple and amazon? jason: there's a lot of concern that this is getting stretched. if you look at the growth numbers on the earnings side, you justify the valuations. this is not a 2000 kind of scenario. but within the tech space, you need to be more selective. companies inour the software services area, things that have longer legs in terms of the overall growth story. what we are a little more position for on a sector basis is the cyclical rebound. consumer discretionary, areas of industrials, things that will have lagged some of the growth rally. tom: how do you respond to 28 and 30 multiples in stocks that don't have the revenue growth of amazon? you've got maybe high sink of revenue growth if you are lucky -- high single-digit revenue growth if you are lucky, and these are priced like half a century ago. we are definitely more selective in their ea

tom: andrew slimmon. we are going to talk about the -- if this is not enough for you, how about lower equities? capital markets in the trenches of strategy. futures -10. there,e bit of -- stop 23.76. i have no idea what those phrases mean. ♪ london,ncine lacqua in i am tom keene in new york. stanleylimmon of morgan investment management. toant to go back diversification was 300 equity shares. peter lynch revolutionized the landscape, his phrase " diversification." are 23% of the standard & poor's 500 makes up eight $2 trillion apple and the rest of them as well. what do you do about it? you can't tell me you cannot own those, you have got to on those stocks, right? andrew: that is a good question. never forget that what happened in 2000 was we had high concentration of a few stocks on the s&p. , the s&p wasbroke down over 20% in 2000. but, the equal rated s&p was up. the value in part was up that year. i think the danger is that while people are buying the markets, they are really buying a handful of st

jonathan: i've been here for five years, tom. tom: really? i didn't know that. jonathan: county you down to the payrolls number, four minutes and 30 seconds away. we come down 11 on the s&p 500, down 0.3%. five day winning streak on the s&p coming into the job sprint. $1.1820.ar, down 0.5% on that currency pair. the bond market treading water, 0.53% your 10 year yield. the median estimate, 1.4 8 million on payrolls. the print up next, here on bloomberg. ♪ jonathan: it is about that time. the payrolls report 10 seconds away in new york city. the most unproved dicta both -- the most unpredictable prints in months. here is michael mckee. michael: we are looking for the numbers to come in. we are above forecast. 1,000,008 hundred thousand jobs is the total nonfarm payrolls, with 17,000 jobs additionally added. jobs.00,000 26,000 manufacturing jobs in the unemployment rate falls to 10.2%. average hourly earnings up .2%. the annual average, 4.8%. average hours unchanged. there was an expectation they would drop down but they come in 34.5. a couple of things i want t

tom: thanks so much. let me do a data check here. i don't think enough has been made about the equity market, one day up, two days up, three days up. led by tech but dragging others up as well. futures up 12, dell futures up 152 points, 28,391 on the dow. honeywell, amgen, salesforce.com. did not play yesterday, they play today. yield, 10-year are we and chairman power watching closely. it has been -- chairman powell are watching closely. churning a little bit weaker. anna? upside bring you the reaction to the trade news overnight through europe. on european percent stocks. the dax is doing pretty well compared to the others when you look at year to date performance. we watch that one very closely. where we see optimism from german businesses, better mute music -- better mood music between china and the u.s. we sell the dollar and buy currencies, and the euro and the pound both go higher. tom: it is a second night at the convention, our coverage beginning at 10:00 p.m., scheduled to speak tonight, the comments asill make well as secr

tom wolfe: it i just did. guest: i'm sorry, i missed it. tom wolfe: if i would've known this topic. guest: . tom wolfe: anybody miss when i'm just saying, you didn't miss much. [laughter]. guest: hi. it's been a few years since i read your last book. but i believe it's one of the best pieces of the 20th century. i also was just wondering if you would repeat con ed on some of that compared to what is going on to the current scandal today. another slot there. tom wolfe: i would tell you, i just missed a couple of words. guest: if you would comment on some of the commonality. of what that piece met. [inaudible]. tom wolfe: yes, i would be happy to. i have written a novel in which, about a college in which there are a group of rough and crude in the way, aggressive people. i've also written a novel in which there was a white district attorney, running for reelection in the district in which he badly needs black votes. and he is pleased, oh so pleased to find the very nearly difficult character in such a situation you're in for. namely was known in courts as the great white defender. i'v

that's not for tom to do. but what i want to talk a little bit about, they did belong in the telling and that is the rolls of shadow market. tom does a great job talking about answers and trent interest rate issues and the role of real estate. he talks about the asian financial crisis and lessons learned. this played a large role in the financial crisis to pray china has now the second largest security market in the world. it's going to become a bubble. china and the u.s. have both embarked on international policies designed to eliminate brother to harness the national opportunity. : : thanks don't run out of funding, it's the economies that run out of intangible value to economize and the definition of that is a function of information quality and this is an area where we all have a lot to learn still . thanks . >> thanks and, really appreciate that. let's go to logan right, thanks for joining us. >> thank you scott and thank you tom. i really appreciate the invitation and tom, just want to say joined the hal

i'm going to turn things over to tom, he is bloomberg's chief economist prior to joining bloomberg tom worked as china economics correspondent for the wall street journal. as an advisor to the uk executive director of the ims and policy analyst at the british treasury and european commission. he's also an author of understanding china's economic indicators which delve deeply into chinese statistics. tom, thank you so much writing this book. we look forward to your per dissipation and the conversation this morning. >> you veryÃbthank you very muc. just give me a moment while i share my presentation. >> that looks fantastic. >> does it move? >> it does. >> fabulous. it's really never been more important that all of us understand not just china's economy but the intersection between china's economy, china's financial system, china business, china leadership, china security, and i can't think of anyone in the world who pulls the pieces together more smartly and more prohibitively than the team at csis. i'm delighted that csis would host this book talk, thank you scott and the team there f

tom: this is so important. they need to get x number of votes in flint, michigan, or kalamazoo, or some city in wisconsin i can't pronounce. policy is not going to get those votes. the culture war is going to get those votes. how does the vice president address this nation's culture war? jeanne: this is where i really have a respectful disagreement. i do think people need to know what their plans are, whether it is economic policy, tax policy. because if you are trying to get those voters in kalamazoo or people who listen to you and are experts on the market, you need to say that democrats are not just the party defined as a party of bigger taxes. is goinghis tax plan to cost $10 trillion. how are you going to pay for all of the programs you have in mind? the moderate voters are where you win this thing, so i think policy matters an awful lot to get beyond this sort of stereotypical description of what the democratic party is, and to differentiate biden from trump, who is his opponent in this election. i think

tom: no question about it. i see the bid taking away on the two-year yield, down just a little bit, with futures up 12. what do you think? jonathan: equity futures up 12, around about 0.3%, off session highs. the yield higher at 0.53%. i just think it is hard to take the adp report and make a read across. look at how big the downside surprise is, and how massive the upward revision is to the previous month. it just speaks to the insert still and a huge amount of -- the uncertainty still and a huge amount of churn. tom: right now, a really important conversation if you are worried about the stresses of this pandemic. louisiana has been extremely hit with a legitimate second spike in cases and deaths. they have the correct senator to monitor his louisiana, and that is william cassidy, the republican from louisiana who long ago and far away studied medicine, and if long ago and far away supported mike dukakis. i want to speak about your louisiana state university. they want to get their football season started. th

tom: exactly. we are not talking about austrian 100 your paper, but what is the horizon risk of higher yields, lower prices on a 30 year german bond? aren't investors, the ability to be crushed here is just extraordinary. michael: it is. if you go up 50 basis points, you are looking at losses on a price basis of 10% plus. the potential downside is enormous. the potential upside is very limited. it seems to us it is really not the greatest strategy. [indiscernible] tom: anna edwards, what mr. schumacher just said is absolutely critical. yield get a 0.5% move in you see ayear bond, reduction in the value of your investment. i thick a lot of people don't understand that. anna: absolutely. let depends on how negative it was when you traded in and how negative it is when you traded out. theme ask you about election in the united states and what that does to the curve you are looking at stateside. do we see a sort of textbook reaction to a changeover in power if that is what we get, or is there no book a

tom: tom keene in new york. good morning. what i find interesting is the this guy.of how alone is he, and how does mr. putin adapt and adjust to his loneliness? lukashenko has one main ally, and that is russia. he has failed to build up alliances in europe, or chosen not to. drawn censureve and sanctions at times from the of. and europe, so in terms who can he turn to, it is russia. so what is the determinant or this guy to keep him out ring somebody in? what is the single factor that matters to mr. putin? the main buffer still standing, one of the last serving republicans that stands between russia and the european union and nato, belarus. that -- thate few said, lukashenko has also turned against russia at times. cantankerous, and very fierce about independence from russia, and has accused russia of meddling. earlier this year he was turning against russia in the run-up to the election before he -- he has told russia that if russia doesn't support him right now, then european forces could charge through and end up attacking

tom: one final question. my radar is up because everyone i talk to is focused on the suburban voter. where is the rick davis study? a look at another part of this electorate? rick: a number of things. donald trump got to office on the backs of blue-collar that abandoned the democratic party and voted for him. part of what we have heard at the convention is trying to keep them tight. whitesf the blue-collar are christian evangelicals. we saw a lot of talk this week about how donald trump has been the protector of the religious right. that has been the box that people don't talk much about. heard mike pence talk about the embassy in jerusalem being removed. talking about antiabortion legislation. all of these things are to pump up that group. if they are not enthusiastic, and you can make the argument that they wouldn't be enthusiastic about the way donald trump has conducted himself in office, you start to lose the base. the first order of events has been to cover that. tom: rick davis, never enough time. sena

tom: good morning everyone. a perfect morning in new york after rain the entire weekend. tom keene in new york. jonathan ferro is so off. lisa abramowicz is so off. lucky me, anna edwards joins from england. before we get to your morning brief, would you explain to our american audience on radio and this great ruler in britain? -- great uproar in britain. just in 20 seconds, what happened? >> so a levels are the exams you do that get you into the school or university of your choice if you do well. nobody took exams this year of course, which meant the government had to put in place a system. people didn't like being downgraded by an algorithm and the process is in chaos. it has caused a huge political storm here. it shows the competitive column of the u.s. education system as we stagger back to school. it's a jumble. you know where you were on friday, where you were on thursday. i am watching turkish lira with further depreciation. you have a look at the things to come here. my mind skips

tom: mark, good morning. tom keene in new york. one analyst writes up on bluebay asset management, on the highway securities and the idea of traipsing through bank stocks by using cocoas. explain that strategy that bluebay asset management was featured on. mark: the part of the credit market that we have really liked him course of the last couple of years and continue to like a lot is european bank credits. in no way, in the last recession in 2008, we saw banks in the eye of the storm. they got beaten to bits. banks took a lot of risk and they did not have sufficient capital. banks were not a place it wanted to be as a credit investor. but in the recession we are seeing, we are looking at banks with very strong buffers in terms of near-term ratios. we have seen them take a lot less risk than they used to take. a lot of the risk has now really been packaged off elsewhere. we actually think banks are boring. barring is good as a credit investor. it does not mean we are bullish about, bank equity stocks however, buying these subordina

tom: i think -- no. tom: i think you are dead on. maybe we could see a change in that in the next year. tony: in europe, there's a little bit of that. tom: i will give them some credit on that. we need a tunnel to staten island. that's what we need. [laughter] tony: instead we've got the 56-year-old bridge that links brooklyn to staten island. jonathan: this got derailed quickly. tom: the show is falling apart at light speed here. [laughter] i want to ask you a lisa abramowicz question, which is really important. i have never cared about treasury supply, full facing credit supply. yet now i really have to, don't i? tony: maybe, but remember, the world population is aging. what do we do as we age? we move up in the capital structure. there's a lot of money that still flows into bonds despite the low yields because people want to protect their savings. let me give you summer reading, three books real quick that would describe the current situation. let's go back to hundred 50 years, "theback 250 wealth of nations." there's always a nee

tom: no question about that. right now our first word news in new york city, here is riddick gupta. -- a ritika ritika: the longest-serving prime minister in japan's history is resigning after eight years because of health reasons. the government has provided few details. news reports that he has been undergoing treatment for a chronic digestive condition. he plans to stay on the job until his party picks a successor. president trump made his case for a second term and last night's republican national convention. he promised to cut taxes, and create 10 million jobs in 10 months and turn the u.s. into a manufacturing superpower. >> in the new term as president, we will again build the greatest economy in history, quickly returning to full employment, soaring incomes and record prosperity. ritika: the president also warned that joe biden can't be trusted to deal with the coronavirus pandemic or heal the nation's racial divisions. chair jerome powell of the fed says the fed will allow inflation to run above the 2% t