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tv   Bloomberg Markets  Bloomberg  October 2, 2015 3:00pm-4:01pm EDT

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september mean for the u.s. economy? scarlet: treasury yields below 2% on the 10 year. we will look at the probability of a fed move very alix: president obama will answer questions after one of the longest-serving members of his cabinet steps down. scarlet: good afternoon, everyone. alix: we are going to go straight to bloomberg's julie hyman. julie, it was a surprising day. at one point the dow was off by triple digits and now it's off by 43% -- 43 points. that was the playbook, the idea of bad news is good news because it means the fed
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will be on hold for longer. more recently, with all these global growth concerns weighing on markets, it is surprising that you're seeing the same sort of interpretation, the idea that rates will be lower because of boostingomic news stocks. of course they got a boost from another reason today. this is something you two were talking about earlier, oil prices. they can look at the bloomberg terminal. the intraday movement in the s&p 500 right here -- yes, it's been trending up since midmorning. and you have oil prices which got a big leg up, right around 1:00 we got that rig count number coming up in an stocks went on to make the highs of the session with energy shares as the best-performing group. if you look at that rig count -- alex, this is something you been watching closely -- we are continuing to see it fall. the idea maybe this will finally contribute to the working down of the glut that we have, also we have been watching oil on the week because it looks like
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potentially we are very close to actually being up on the week for oil prices. down just $.15 on the week, or 1/3 of 1%. interesting here that we saw that and here is that rig count i referred to you. this is a five-year chart of the rig count. alix, i know the question you frequently look at -- when will it actually come down enough to make more of a significant dent in oil production and supplies? you are getting more with less at the end of the day and that is holding back the recovery. scarlet: all that efficiency in the energy sector. alix: getting back to the chart support, what has it done to move interest-rate expectations? julie: you can look at the 10-year as one proxy for this. market, wehe stock
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saw them bounce off the bottom but still below 2%. the other way we look at is by wirp on the bloomberg terminal, a measure of interest rates. the implied probability in those features -- that falling 34%, 34% chance of and increase. that bottom chart you see, there are charts. of aistoric probability december rate increase. you can see it has been trending downwards, and took a sharp leg downwards after that jobs report today. alix: julie hyman, thank you for setting the scene for us here. fallingat one point 1.6% on that disappointing jobs report. speculation is, will the fed keep those rates lower for longer now. scarlet: the chief economic the fed has that
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important to medications challenge once again. >> the critical issue for the fed is not when it moves first. it is the journey. has an important communication challenge. between now and december, it has to take the market focus away from obsessing with the timing to realizinghype this will be the loosest tightening in the modern history of central banks. scarlet: joining us with more is marianne bartel, chief investment officer of her folio solutions at bank of america's wealth management solutions. i love what he says about the loosest tightening in the modern history. >> even when we went into the fed meeting, it's the first time in my career where i felt the market did not know how to price in what the fed was going to do. the market now continues to push out a rate hike. yet at bank of america merrill lynch, we are still not taking the potential of a rate hike in
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december thinking -- happening. i do not think we are the only house doing that. the issue for the markets being created is all this uncertainty about what is the fed doing, what is going to be the plan, although we believe that they raised and they raised for a gradually over time, maybe even every other meeting, but the market really doesn't know for sure because the fed has not told us. the other uncertainty is global growth, particularly china. when markets have a lot of uncertainty it creates a lot of volatility. you can resolve some of this uncertainty, volatility will remain within the marketplace. scarlet: what happened to the input? mary ann: it started with the greenspan put. now you have the yellen put. scarlet: we did not really see it in action at 8:31. mary ann: you have the put in the sense that they are not raising rates. the debate within the market --
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should the fed raise or shouldn't it. there is a camp out there this is absolutely not, he would be terrible if they raise rates. there's another cap saying they have waited too long. -- camp saying they have waited too long. we have not witnessed this in our lifetime. until we really look at history, we don't know what the right answer is. wait and seeto when the fed raises rates, how everything evolves. the fed does want to get off the zero bound. they have no policy levers left. we will have recessions, we will have things that happen. they want more policy tools in their toolbox. and our data is good, particularly from the consumer. that is where the silver lining is in our economy.
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alix: we have talked about how the silver lining is the consumer spending but in the jobs report today we saw aggregate income declined by 2/10 of 1%. sincee not seen that december 20 13. does that imply the stock market volatility and overseas anxiety is spreading to us buying stuff? mary ann: that is one month, one data point. if that continued, i would be concerned. what we are going to be watching right now is the holiday season. pretty shortly this is when the consumer will start buying for the holiday. it is the baby boomers that have the money, they are a $15 trillion economy. spent right them now's hospitality and leisure. it is not necessarily in the traditional retail. some of the millennials you will see buying, particularly in footwear. one of the groups is holding up well in the marketplace is footwear. there are pockets that are doing well, and what we have learned
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in the past what works, it generally works as the market recovers. you provided us a chart that shows the s&p 500 yield, how it was again is above the 10 year treasury yield. tell us what that means in terms of allocation over the next six months. mary ann: when we have the market yielding higher than the ten-year treasury, it's normally a screaming buy over the next 12 to 18 months. it happens very rarely in history. we haven't really seen it in magnitude until 2008, 2009. even though that was a bad period for the market, in hindsight it was a great dying opportunity -- buying opportunity. for our clients and investors that can take a longer-term deal, if they want to grow their assets, they don't have any
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choice in terms of investment -- cash and bonds we don't think are going to grow your assets. you can grow them in the equity market and you can get income. the baby boomers one income, you can grow your income as well with companies that are raising your dividends. alix: it seems like all these alternative indicators are not working. you can look at the stocks, the new york stock exchange beyond their 200-day moving average. none of them seemed to work. here is the issue. when you have an oversold market which you're highlighting indicators that suggest the market is oversold and you cannot sustain a rally, you have a bad oversold condition. can work off whatever the market is concerned about, the market cannot bottom. is definitely confidence. sometimes in this type of market environment you really have to throw the baby out with the bathwater before you get the market bottom.
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we call that capitulation. -- youf capitulation rally on the day but you do it on explosive volume. then you -- than the market can hold rally straight you look at 90% up days, when both rapid volumes stay to the plus side. if the market closes in the internals are negatives -- or negatives, it means the market is not washed out yet. alix: not there yet. scarlet: mary ann, thank you very much. the chief investment officer at bank of america merrill lynch wealth investment management. alix: the french president says progress was made today as leaders from ukraine, russia, france, and germany met in paris to resume peace talks on ukraine. hollande says the cease-fire is now respected.
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agreed ons originally terms during a previous meeting in minsk in february. progress in key areas of the deal seem to have stalled. scarlet: jason chaffetz of utah preparing a bid to replace john boehner as speaker of the house, according to politico. leader kevinority mccarthy is considered the favorite, but daniel webster of florida also in the mix. boehner is stepping down later this month. alix: another house speaker candidate making his bed congressman kevin mccarthy is retreating from comments he made suggesting the house benghazi committee was created to undercut hillary clinton's presidential campaign. the california republican tells fox news he regrets making the panel's purpose of your political. he is the current house majority leader and is looking to quell the controversy as he vies to replace john boehner. scarlet: more politics coming up on bloomberg television later today. don't miss an interview with john kasich.
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life from new hampshire at 5:00 p.m. eastern. ♪
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scarlet: this is a live shot of the state dining room and the white house. the president is expected to make a statement in about 15 minutes regarding personnel changes. the education secretary, arne duncan, is stepping down. be takinglso questions, which can range on anything from personnel changes to jobs to syria. alix: we will see if he will mention guns at all after yesterday's shooting. it's rare for him to have a press conference on a friday. scarlet: in the meantime, let's
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get a look at companies stories. the internet giant google has announced it expects transition stock from google to alphabet. that is according to "the wall street journal" reports. google will be one of a number of independent businesses operating under alphabet's umbrella. stockss class an and c will begin trading as stock on the nasdaq global select market on monday. they will keep the same goo and googl ticker symbols. alix: microsoft acquired the leading provider of 3-d physics and gaming tools supplier from intel. just an announcement on microsoft's website. it is created more than 600 games, including "call of duty." microsoft will continue to license havok's development.
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scarlet: the number of oil rigs in use in the u.s. is collapsing. now at a five-year low. it marks the fifth straight weekly drop. america's oil drillers have idled more than half the country's rigs since last october. those are some of your top stories. alix: it turns out it may not be as wild and sexy as you think. scarlet: joining us is a senior etf analyst at bloomberg intelligence. three traits that at first glance look like fascinating ideas straight you don't say that's the case, though. -- ideas. you don't say that's the case though. talkingticle came out about how hedge funds are taking advantage of structural flaws in the etf's. when you go through the traits they represented -- which make
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the minority -- most hedge funds are doing normal things. they love etf's. smaller ones that do some wild stuff. one example, i call it robbing grandma. they are waiting for a day like august 24. they are hoping that some etf if a market order comes in -- there's market makers that widen their spread and there's a chance to buy and etf at a huge discount. the reason i call it robbing grandma is because no institutions or big fish will put in orders like that. these are small orders. it happens once every 18 months if we are lucky, we get these crazy days. andto mention the ensures exchanges are looking into how to make sure that this not happen again. idea.s a far-fetched that happens on a smaller scale intraday, with arbitrage are you
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take care of minor discounts. that is actually good because that keeps the price close together. making money on these wide discounts is far-fetched. alix: if you go long and short, already leveraged etf [indiscernible] how often does that actually work? it seems like the losses would be huge on the downside. >> the tail risk is massive. credit suisse did a study. it works 68% of the time. i talked to the three times issuer. they said 10% of the volume in leveraged etf's is this trade call the double short. when it doesn't work, you could really lose your shirt. in the first six months, three times oil and three times negative oil were both down 45%. it was a market that was very volatile. july, becauseto
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oil went down steadily, it got killed. if you expect volatility, the double short is a great trade. if it's not volatile and you get a sharp slope down, you could get killed. not necessarily killing you but eating into your returns is the fact these leveraged etf's -- these are quite high. not in theree are that long. most people only care about the extensor issue when they're in long-term. short-term investors and hedge funds, they could care less. alix: the other position is dealing with the role. if you're betting on an etf with a futures contract, you can play the futures market. how realistic is that trade? >> there's a lot of hedge funds that do that. they're holding periods are pretty long. mostly people use uso to go long or short. the problem with frontrunning -- ef's simply don't -- etf's simply don't own that much.
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uso, it only owns 4% of the three months of crude oil futures. when it rolls, it also breaks it up into chunks. when you are frontrunning it, you are buying it at noon or some point to get ahead of it. there are all these other forces at play. you're looking at a 2% of the market. if oil has a bad day, you take on a lot of by trying to just basically get lucky that nothing happens and a little buy bump sends it higher. you start to put these things into scale and context, they become much riskier than you would think. scarlet: eric balchunas, thank you very much. ahead, we are awaiting president obama, who is due to speak at 3:30 p.m. on arne duncan with a q&a session to follow. ♪
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are looking at a big rebound now, the dow up by 126 points. hey, julie. julie: i'm starting with the group that is still not doing well, the financial group. jpmorgan bank of america, wells fargo still some of the financials limiting the pretty substantial rally in the major average ridges -- averages. there's a lot of debate about what an increase in interest rates is eventually going to mean to these banks. one of the benefits of the increase in rates could be if you see a widening yield curve. maybe that could be one of the things weighing on the banks today. the miners are doing pretty well today, that's because we've seen a bid to gold prices.
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all of them are trading higher. these stocks have been battered this year as well. that is the context. sprint is another stock that is not done so well that is doing better today. the stock is up i 5% after announcing a new cost-cutting program, he will aim to cut $2.5en $2 billion and billion in the last few months. finally, jcpenney, speaking of companies that have been struggling to some extent, cutting its pension liabilities a getting a big new stuff of that. he reached a deal with 12,000 retirees and beneficiaries to accept a lump sum payment and settle obligations. here is the key, it is going to cut its obligations by 35%. this is a move analysts and investors are greeting by buying the shares today. course, 26 minutes
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left to go in the trading day before we close the books on the weeks. alix: let's turn to politics. good news for presidential candidate john kasich, who picked up the endorsement of gordphreonumas well as peter thompson today. mark halperin is spending the day with him. scarlet: he will be interviewed on "with all due respect." mark, tell us about your day. how is it gone so far? have you been picking up the phone, carpooling? mark: we will have a live interview with him at 5:00. we talked to him throughout the day, started at his hotel in concord this morning, went to the gym with him. watched him on the elliptical. we have driven around. we got that endorsement from gordon humphrey. during one of the rides we're talking about today, and i asked if somebody was curious about, had he ever met vladimir putin. >> i never had. mark: what do you think of him
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personality wise? >> i think he's a little bully. he will push you as far as he can until you say no. mark: little shot there at putin. he took an uncharacteristically hard shot at barack obama, talking about syria. everyone will see this at 5:00 -- he took shots at jeb bush. i asked him why. took a little shot at jeb bush at his press conference. i asked him why and he said he wants to shake things up, make things interesting. it's an interesting moment. interesting. what was the number one thing you learned about the governor that you did not know before? mark: i can't say i learned anything brand-new.
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the most interesting conversation i had was about his eating habits. being on the campaign trail as a candidate even with all the staff around, food is never far from a priority during the day. in the morning we set at breakfast at the hotel. i asked him if he was hungry and he said no. wasr the second event, he hungry. there is some nice interplay between him and the staff about how the schedule will coincide with the governor of ohio. scarlet: food and fuel are key. k-6 has also moved up in the new hampshire polls. -- kasich has also moved up in the new hampshire polls. what is the strategy going forward? scarlet: this is a state where he has invested a lot. felt enough success that he's putting investment into iowa.
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those caucuses are harder to organize and don't usually do as well. people who are moderate don't usually do as well. he's not going to be a flashy candidate. he's not going to be an anti-establishment candidate. he will try to convince people he's a good combination of washington experience, governor of ohio, and also a guy who grew up pretty humbly. beenf his stump speech has introducing himself to voters, telling them his life story. state, so much political awareness, he still needto educate people about who he is and where he comes from. he's not at the top, but he likes his chances given the history of the republican party and a kind of people historically the party has nominated. alix: we are also waiting for president obama to speak at the state dining room of the white house. you will be talking about his education secretary, arne duncan, resigning. in the q&a what do you think we will expect to hear? mark: syria is still top of
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mind. is going to get asked about syria. lots of questions about how to deal with the russian activity. there's more behind-the-scenes ands at the military diplomatic level between the united states and russia than has been reported yet, as i understand it. also to speculation about how the president will react to the most recent development regarding the russian airstrikes. that will be pretty front and center. there's a lot of uncertainty regarding things like the budget increasing the debt ceiling with speaker boehner, and questions about how much he can get done and working with the democrats in congress at the white house before he leaves the office. some of those thornier issues like the debt ceiling would probably be better handled by speaker boehner than his successor. we are obsessed with the jobs report and what the fed does next. it's a something the president would be speaking on or that
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might be asked of him given he does not have that much of a hand in what the fed does? mark: white house is in general shy away from commenting on fed activity. the president would like to see more robust economic growth. he knows full well his legacy will be quite different regarding what he did on the economy if he leaves office where growth is headed more towards 4% then the 2% level it has been that for some time, and if the fed decides going back-and-forth with so much uncertainty not just in the u.s. economy but overseas, the fed is decided to keep rates historically low. not only because of his legacy but any hopes of a deal on some of those bigger issues are a lot easier with more robust growth. immigration reform is easier. everything that is tough is easier with more robust growth rates.
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the budget becomes much more manageable. scarlet: difficult from today. thank you so much. tune in tonight at 5 p.m. eastern with -- for "with all due respect." president,for the phil mattingly is standing by pressackground on the conference. it is not that common that the president speaks on a friday afternoon and holds a question-answer session. and we expect him to comment on the jobs report, is that why he is choosing to hold a q&a at this moment? the primaryit on reason for the address, syria. and the shooting. you might hear him talk about this to get in -- this again.
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this is going to overshadow what will be a very nice statement about arne duncan, the education secretary. they had a lot of plans when they came into office but the second then-president turns this over to reporters i guarantee there on ash will not be a single question about arne duncan. they will start with vladimir putin. you might get to the broader syria policy. the u.s. mission to train u.s. backed rebels, bedded rebels has failed miserable -- miserably. the coalitionh which has grown uneasy about russia's act cavities will be something that comes up. something about the shooting. you look at the jobs report and while that was a terrible number and certainly not what anyone expected, it is something that i can guarantee will not come up today. it might, it probably will not. when the president comes out on a friday and a sense -- decides conference, he
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wants to talk. there is a reason he is coming out and that could make for very long press conference unless he gets upset and that it could shorten quite a bit. scarlet: we did hear president obama on that tragic shooting in oregon. will that be on the docket? the interesting thing about these types of events, the president does not have any control about what will be asked . maybe something about joe biden or donald trump, depending on how long he wants this conference to go. the interesting question that people would have in the wake of his remarks yesterday is what specifically would you like congress to do or what do you relatinggress can do to guns and i think the answer and the president hinted at it when he made it more a broad call to change the dynamic in congress, the people who vote on
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the laws, not the current dynamic that exists. i do not think the white house as it pushes on this and the president plunges -- pledges to talk about this, the facts on the ground are pretty basic. there is no chance that any type of gun-control bill will move forward. whether he has something he can do on the executive level or any specific plans, that would be interesting when it comes to guns but if he is asked you will hear more about what he said last night which is if you want change, if you want gun-control to be an item you need to change the members in the house and senate. scarlet: his tone was one that was very frustrated when he spoke yesterday. the announcement. does that mean the president will wade into a confirmation
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fight in looking at the next secretary? white house has been coy about if and when he will nominate someone else. the white house good -- has good relationships with the department of education throughout the president's two terms. case, andt always the a lot of that started with the top with the president, arne duncan, good friends and played basketball together and on the campaign trail had a really good relationship. last original cabinet member to leave. they will rely on the deputy of education secretary but at some point you will see someone new be rolled out there. education hasat become a more inflammatory topic when it was -- than it was when
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the president entered office. scarlet: stay with us. we're still waiting for president obama at the dining room of the white house for that press conference. we don't -- we do want to look at the markets. the s&p is at that 21 points and before that -- stocks are up as much as they were down when we got out of the gate this morning. following on the heels of the job report we had this big flip lot over the course of the session. quite a surprising flip-flop. if you look at the intraday chart it illustrates what you were pointing out. that we have this lower the open and then rising gradually and steadily throughout the course of the day.
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map for where the we stand on -- in terms of the best and worst performing groups. energy had a big reversal after we got the latest numbers. materials doing well from the mining stocks. health care also turning around after a very tough couple of weeks. tech gaining so a lot of the cyclical groups that have been declining in the session turning round. the one group that has not, the financials which remain lower. i was looking at the s&p 500 to pinpoint individual stocks that are contributing. you have a pretty diverse group. . apple is on the rise, rebounding after some declined yesterday. pfizer also gaining. morgan stanley coming back in taking another look at the drugmakers after the dismal performance and trying to figure out where can we find some value here, this is one of their topics. exxon mobil is contributing to the game today, rising along
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with energy shares generally. alix: the other big move that happened in the markets in terms of the jobs report and that is the 10 year yield. fascinating. if you track the dollar index it is pretty much the same move. right around 831 that jobs number came out. a big lake down in yields. about 1.9%. almostbeen able to rally two 2%. the fed might hold back a little rates way it might raise but the trajectory is still on for a hike at some point, if not october, december. we are not at 1.5%. we did rebound. the hypothesis or the going thinking is the jobs report was negative because the economy has done terribly and we are taking
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it a leg lower because of overseas pressures. the slower growth reflects more difficulty in finding qualified workers. you're seeing evidence of a tighter labor market and that is limiting job growth as a result. it is a bad number but it shows the strength underneath. julie: there are not as many workers for the jobs needed. an interesting location. we do want to continue our wait for president obama. he will be speaking at the dining room at the white house. we want to go back to phil mattingly. he will come out and address the audience. of course he will be talking about arne duncan, education secretary stepping down. run through the highlights of what we can expect. phil: the reason he will turn
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this to a question and answer stamen and not just us -- a personnel statement is syria. also his strategy on the whole. you have a 62 nation anti-islamic state: ocean that has been somewhat listless and directionless. the president tried to address this in new york earlier. speech thethat biggest problem the white house is facing is no one grasped what the coherent syria strategy is and i think that filters down. you hear it at the pentagon, across the obama administration. this is being considered in washington and almost a big failurey for the obama administration. what you will hear the president attempt to say is he will try and address that. take it face on. i would not be surprised if he announced some type of shift of policy. explain where he stands
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and why and in his mind and the minds of the national security town so, that is a valued and coherent position and a tragedy that has seen hundreds of thousands of lives lost. that has been the big question at the table, throughout the week, throughout the last couple months that the obama at -- administration and himself, they are cognizant of the fact that he needs to answer these questions himself. not allowing his top aides. this will be a wide-ranging press conference and there could the a wide range of things. if you want to know the key issue that the president wants to talk about, it is syria. scarlet: the president is approaching the letter -- lectern. arne duncan is: one of my longest-serving cabinet secretaries and he has been a friend for a lot longer than that. some regret and
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sorrow that i have accepted his decision to return to our hometown of chicago. after more than six years of living in washington, arnie is -- arnie's wonderful wife karen , clearir excellent kids and ryan who are also buddies of mine, wanted to move back home. that is meant in the interim -- i will be honest, i pushed him to stay. sorry, guys. i also know from personal experience how hard it is to be away from your family on a sustained basis. while i will miss him deeply, he is more than earned -- has more than earned the right to return home. arne hasok at what accomplished. he is one of the longest-serving secretaries of education and history and one of the more consequential. they have delivered some incredible results at every
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stage of the execution -- educational experience. nearly every state has raised standards for teaching and learning and expectations for what our kids can learn and our high school graduation rate is at an all-time high. we helped millions more families afford college and more americans are graduating from college than ever before. that is just scratching the surface area he has done more to bring our educational system, sometimes kicking and screaming, into the 21st century than anyone else. america will be better off for what he has done. it will be more competitive and proper us. -- prosperous. he will be more equal and upwardly mobile. i truly believe no other education secretary can match. leads the stuff.
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he cares so much about our kids and he has been so passionate about this work. and everybody who interacts with him including people who disagree with him on some issues never questions the genuineness and heart that he has had to this job. i could not be prouder of him and for good measure, he also holds the record for most points scored in an nba all-star game. [laughter] [applause] and he is myma: favorite partner in pickup basketball. [laughter] the smartest player i know, even though he is very slow. [laughter] and has no hops. [laughter] knows it isama: he true. i will say watching ryan that the sun wilson be surpassing the father because this in man has got game -- young man has got game.
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none of the change has been easy and we still have a long way to go. one of these about education is that it does not deliver results tomorrow or the next day. this is a decade-long or longer proposition. we plant seeds now, we make changes now, and we watch each successive class benefit from these reforms, and it goes in fits and starts and we have a decentralized system. that is how our education tradition evolved. so it is not easy and it is not quick, but we are making progress. are not going to stop in these last 15 months, and that is why it is so important and why we are very lucky that even as arne steps down, we have an exceptionally talented educator to step in.
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john is already on the leadership team. he has been an educator all his life, a teacher, principal, a leader of schools, the new york chief. education he shares our commitment to preparing every child for success in a more innovative and competitive world. got a great team already at the department of education of which i am very proud. cool andly is equally good looking, and he has equally exceptional children, and i know that together, where going to continue to do great things on behalf of our kids. i want to watch both of you a hearty congratulations and good luck. now i will let them say a few words, and then i will make a few remarks before he takes them questions from the press.
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mr. duncan: he asked us to come to d.c. and work with him, that was a one minute conversation and it was not that we want to i just wanted to be on his team. i believed so much in what he was about and what he stood for. seven and a half years later, my admiration is only greater. it is important for folks to know that every hard decision, his only question was what is the right thing to do for kids in challenging us to fight for kids every single day. and his never a factor, passion, and his commitment has been extra ordinary. it is not the political leadership, not the educational leadership, it is the moral leadership. mr.st cannot tell you,
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president, what an unbelievable honor just to spend some time and for those -- every day you see folks who watched him last night talking about the gun massacre and how preventable these things are, we need that marble -- moral leadership. the team you have the white house, has been extraordinary to work with. i do not say this lightly. i think our team is stronger than it has ever been. you never know over seven or eight years how those teams go. -team at the white house. team in place, extraordinarily hopeful and confident about what they can do together. and my intent and the rest of -- for me, itaid is very personal. john is one of those kids who
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should not be in a room like this if you look at the stereotypes. not the easiest time growing up. he lost his parents at an early age and went to live with other. he had an amazing teacher who saw something in him and kept him going. he gets to stand here with the president and so many times we write off kids who look like john and come from places like john. while i am deeply sad to be leaving, i am extraordinarily happy and thankful and proud that john will carry on this work with the team so i want to thank everyone for their hard work. and thank my parents as well. educators a lifelong at the university of chicago, taught there all his life. my mother started a program before we were born and raised
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us in that program and that changed our lives. all of life we so what kids could do when they were given a chance and that is why we do this work today and be able to see what she did. we have a chance to have an impact around the nation because this man gave us a chance for my family. i can't tell you how much it means to us. and finally to my family, i love this work. i love this team, i love the president, i love the chance to serve. and do wait to come home a couple track meets and maybe have a few more dinners and maybe a movie someday, that would be pretty amazing. [laughter] long. been too it has been an amazing journey, i feel so proud and lucky to have an part of this team and mr. president, thanks for creating a climate for all of us
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here to have the impact we did. we can never repay you for your leadership and courage so thank you so much. i will turn it over to john. [applause]
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john: thank you, arne, for your kind words, thank you mr. faith youfor the placed in me and the team we have at the department. imdb honored by the chance to serve and deeply humbled by following arne's footsteps. demonstrating him tremendous courage in fighting for kids and fighting for what is best for kids it also for being willing to listen, to make adjustments and to make sure everything we do every day is toward the goal of greater equity. andpresident, you and arne the team have laid out an ambitious agenda from strengthening early childhood education and expanding access to raising standards in teaching and learning from k-12 and showing that more americans have
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access to high-quality higher education, to ensuring that we support our teachers and we provide the best reparation and support and leadership opportunity. it is an incredible agenda and i am proud to carry it forward with the amazing team we have at the department. earlier this week, arne gave a speech at the national press club. he said education can be the difference between life and death. know it was because it was true for me. sick for heery passed. new york city public school teachers are the reason i am alive. -- i am alive. they created amazing educational experiences but also gave me hope about what is possible,
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what could be possible for me in life. i know schools cannot do it alone. there are -- is work we need to do a economic helmet and housing. my parents who spent their lives as new york city educators believe that school was at the heart of our promise of equality of opportunity for all americans . that is what they believe, that --what the president, leav believes. every child in the united states, every college student, every disconnected youth, every working parents who wants a new -- a few more credits to improve their job, everyone deserves the opportunity i had. that my beautiful daughters have to have a great education, the kind of education their parents worked to provide. i am grateful to my supportive
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wife melissa. so grateful to the secretary for the opportunity he gave me to join his team an incredibly grateful to the president for the opportunity to work with a wonderful group to try to expand opportunity. thank you. [applause] president obama: thank you. two good men doing really important work. have them both his colleagues and friends and i'm looking forward to seeing even more work done in the next few months. we have got some other business to attend to swallow of you who
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are here to celebrate arne and are lucky enough to have to sit through a little bit of a press conference with me. make yourself comfortable. [laughter] time,ed the kids ahead of i said try not to look completely bored. i'm going to take a couple of questions from the press, but first, a few additional pieces of is this. we learned that our business has jobsed another 118,000 new in september. we now have had 67 straight months of job creation. 13.2 million new jobs in all, and an unemployment rate that has fallen from a high of 10% down to 5.1%. these long-term trends are obviously good news, particularly for every american waking up each morning and heading off to a new job.
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but, we would be doing even better if we did not have to keep on dealing with unnecessary crises in congress every few months. this is especially important right now because although the american economy has been chugging along at a steady pace, much of the global economy is softening. we have seen an impact on our exports which was a major driver of growth for us particularly at the beginning of the recovery. and so, our own growth could slow if congress does not do away with some of the counterproductive austerity measures that they have it in place and if congress does not avoid the kind of manufactured crises that shatter consumer anfidence and could disrupt already skittish global economy. more than half of
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republicans voted to shut down the repose -- the government for the second time in two years. the good news is they weren't -- there were enough votes to keep the government open and operating for another 10 weeks before we could get another long-term solution but keep in mind that gimmick only sets up another potential manufactured crisis two weeks before christmas. i have said this before, i want to repeat it area this is not the way the united states should be operating. --entimes a hear from folks i hear from folks up on capitol hill the need for american leadership. the need for america to be number one. you know what? around the globe, part of what makes us a leader is when we govern effectively. and we keep our own house in order. and we can budgets
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engage in long-term planning and we can invest in the things that are important for the future. that is u.s. leadership. when we fail to do that, we diminish u.s. leadership. it is not how we are supposed operate. and we can just keep kicking down the road without solving any problems or doing long-term planning for the future. that is true for our military and arrested programs, the american people, american families deserve better and we can't grow faster and and the them -- economy could improve if congress acts with dispatch. it will get worse if they do not. that is why want to be very will not sign another shortsighted spending bill like the one congress and me this week. we purchased ourselves 10 additional weeks. we need to use them effectively. yearsn mind that a few ago, both parties put in place harmful automatic cuts that would make no -- no distinction
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between spending we do not need and spending we do. we can revisit the history of how that happened. i have some rather grim memories of it. but the notion was that even as we are bringing down the deficit we would come up with a sustainable, smart, long-term approach to investing in the things we need. that did not happen. and so now, these cuts that have been maintained have been keeping our economy from growing faster. it's time to undo them. we will have then to find our economic and national security priorities in 2016 at the same levels we did in 2006. now understand, during the decade between 2006 and 2016, our economy has grown by 12%. our population has grown by 8%.

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