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tv   Bloomberg Markets  Bloomberg  October 4, 2016 12:00pm-2:01pm EDT

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from bloomberg world headquarters in new york we are covering stories from columbus ohio and washington to london and italy and johannes berg. the euro spiking on the quantitative is set to end. the pound slumping to a three decade low. town -- pound the that is moving. the dollar is at its highest in two weeks. the vice presidential picks get ready to face off at the next debate in farmville, virginia. we will find out from columbus ohio mayor. we are halfway through the
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trading day. the market action is fairly mixed. >> it has been choppy. green out of the gate to negative, back up and down and right now, the s&p 500 is down by about 1/10 of 1%. we are off our session highs as well. the nasdaq is up just a tad there after what is happening with google. hop into my terminal and i want to show you the function and you can see just how mixed we are right now. we did see a couple of these sectors turning to the green. the red.re was in utilities down by 1.9%. real estate also down. these sectors are dependent on what happens with interest rates , also the chances of interest rate movement.
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because of that, these are definitely seeing a fall. the financials are of the most by a tenths of a percent. in terms of choppiness of the day, out of the gates, here we are. because of the rising probability of interest rates fund --ou folly are fed follow your fed fund future .unds, we are in the middle let's look at what is happening in terms of loan stock. these shares of sears are holding. this is the highest since november of 2014. you can see it shoot up. it has been on a volatility trading paul. potential deal coming
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out from interest from black & decker and also hong kong's tpi. other companies include a textual group and sweden's husk and varnum. that is about 2 billion dollars and those are expected to be due at the end of this month. take a look at what is happening in terms of the gold losingand with its luster, this is it biggest fall since march 23. at its lowest since brexit back in late june. you would expect newmont mining as well as burial to all -- fall. space,a look at the cotton up one to 2%. 20 inches of rain are expected
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from hurricane matthew headed for the u.s. eastern's board. the possibility of a lower supplied definitely impacting. let's get a check now on bloomberg first word news. the two vice presidential nominees, tim kaine and mike pence square off tonight. the debate is being held at longwood university and farmville virginia. it is scheduled to be the only face-to-face meeting between the two men. you can watch here on bloomberg television. coverage begins at 8:30 p.m.. the federal judge presiding over the charleston shooting trial says he wants to avoid undue stress on the victims families. the judge has assured the attorneys that the court plans to recess during thanksgiving, christmas and new year's. some claim to be out of town during that time.
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dylan roof is accused of killing nine black churchgoers last year. theher tirade from philippine president. he lashed out at president obama over criticism of his deadly anti-drug campaign. to hell.n go >> the president's anti-drug fight has left more than an estimated 3000 suspected dealers and ushers dead in just three months. united nations secretary-general monte moon is urging a cease-fire in syria. washington suspended contact with moscow over ending the war. he is holding talks with secretary of state john kerry. vital to supply aids to aleppo.
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-- a id. eight >> let's give you an update on the euro. .t is nearing its sudden gain it may gradually wind down in bond purchases. it may do so with 10 billion euros a month. as you can see, the euro-dollar little rightng now. it has briefly gone into .ositive territory what is the european central bank talking about purchases when the economy is not at a point where that could happen? >> i don't know if they are trying to keep in lockstep with the fed but by announcing , it iss incrementally
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going to be everybody hit the door at the same time. traders will front run this and push the yields in europe significantly higher and undermine everything they are trying to do. like they would create a taper tantrum of their own. >> to make this type of announcement or even to we get it, it is counterproductive to what they have been trying to do to >> the economy. as we see the euro get back some of its steam and head back into a loss versus the dollar, what is see is that the euro maintaining its gains versus pound. that has to do with the sterling dramatic decline overall.
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the pound is falling for a second day, reaching its lowest since 1985 over concerns of a potential hard brexit. i want to bring in from london, executive editor john clare. tell us about the hard economic landing as well. >> it essentially involves the u.k. leaving the european single market and basically existing outside of the trading zone that it has been part of the last 40-45 years. principlesfounding of the european union is that you cannot have access to the single market without having agreed to free movement of people. that means unlimited integration -- immigration from the rest of the eu.
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so perhaps, we don't know yet for sure, but certainly there are people who have concluded that the only way to make sure britain has control over immigration is to leave the single market 100%. isthe way the pound reacting, it would suggest a lot of investors are hoping for a soft brexit. there is precedent for that. why do you think theresa may's government is making it so clear that a hard rex it is preferable? >> we don't know if that is what she is going to go for. we are in the beginning of a long negotiation so this could be all part of the negotiation strategy. a lot of posturing. theresa may has spent the summer looking hard at the brexit results and there was a clear message that a lot of people were very upset about what they integration --d
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immigration into the country. it is the only way to guarantee the british government has full control over the numbers of people coming in so that is one possible explanation as to why the government seems to be favoring this hard brexit option. talkere is a lot of tough from the government. investors are not looking at posturing so much as reacting. why would they at this point be ready to jump on the hard brexit? her talking about immigration is that line in the sand for europeans. eu won't negotiate and they are worried there will be very limited talks between now and when article 50 is triggered. that would put the u.k. at a disadvantage. based on those fears that the talks will not progress, that they will be something of a
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fractious discussion going 12750., they threw it to it could get a little ugly. at 12741.already >> there are some more below 127. was looking at the imf's latest report and the latest forecast -- is there any truth deske brexit here's brexiteeers? >> the u.k. treasury was saying before the point of referendum ant you would've suspected outright recession but that hasn't come about. it is important to know that the economy is going to do well if the currency follows 50%.
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the economy was on an upswing on the run up to the referendum. it seems things are going fine ar now but it is hard to get true sense of the impact. certainly not until we get a firm idea of what it looks like. >> every looking at the benefits of the stimulus? >> that could be in their. policymakers took great pains to reassure people that they would be there propping up the economy if needed. when we talk about brexit we have to remember that it hasn't really happened yet. we are not even in the beginning of it. we are in the beginning of the negotiation for brexit. the u.k. is likely to look different in two or three years
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and it is difficult at point out that look like. exchequerllor of the made the point that he is holding back on investments in the u.k. and he came out and said that while government is , when you talkn to people in government there is a really early day to determine what the impact will be. >> there could be worse to comment when you look at the pound you believe that. that certainly does help boost the outcome -- outlook. which theny point at bank of england might step in to support the pound? >> not really. the central banks have decided amongst themselves that intervention isn't something they want to see.
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they would only entertain it if the market has acted in a ridiculous way. but gyrations like this are typical. sterling will find its own level. there will be buyers that see this as an advantage. between now and then, there are going to be rebounds. >> it would be an interesting level to watch for the day. you could see that watch out. own than cigna rela, our strategist as well. the deutsche bank has pledged more than 47% to raise capital for legal costs. we are hearing from roger altman on whether the sides has made this worse. this is bloomberg.
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>> this is bloomberg markets. i am scarlet fu. withstanding the threat of more large fines. rogers according to altman. these boat to the team earlier today. >> european banks are weaker than most of their international counterparts and we all see the pressures on deutsche bank. aboutrket equity today is $18 million. -- $18 billion. one of the things going on here is that deutsche bank is under pressure for a number of reasons.
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one of which is that it is so small. on the balance sheet, the derivatives, at deutsche bank, the lack of transparency, they just don't understand what is there and they don't understand the linkages to other financials , through europe or the united states. >> that is true but if the justice department had sought to levy a $14 million fine against -- big four.s. 84, , that's fine is not different from the market cap. the immediate reaction is that they can't pay 14 billion. that wouldn't be the reaction against one of the u.s. banks. david: there are also the european banks like hsbc, barclays. orthis a deutsche specific is it also within europe? >> it is more specific to
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deutsche bank than otherwise. they are the ones facing these fines. all, these institutions when you study them are quite different. ubs is a wealth management business rather than a banking business. barclays has gotten on a considerably strong new direction. more differences and similarities and i don't expect this to result in european banking. >> where does the liquidity come from? is it a big insurance company? don't know the answer. there is a lot of speculation about an equity raise which deutsche bank has been denying. it depends on what the final likely settlement amount is and over what. .f time is it $4 billion or $5 billion? the closer to that, that will
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determine whether they need to raise capital. they are hoping not to raise capital at all. scarlet: that was roger altman. still ahead, while there may not be a lot of fireworks, we are going to debate with the most mild-mannered political figures. this is bloomberg. ♪
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watchingyou are bloomberg markets. the vice presidential debate kicks off tonight and the spotlight will shine on the most mild-mannered political figures, giving them an opportunity to serve as character witnesses for their deeply unpopular nominees. here to give us some insight into the face-off, let's head to
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longwood university where the debate will be taking place tonight. bloomberg is on the ground there. some anticipation but no one is expecting this one to overshadow the clinton-trump debate from last week. there have been new polls showing hillary clinton is ahead nationally as well as in battleground states so tell us how that sets up the debate. >> after last week's debate, we saw hillary clinton seen as the winner by most americans. cnn poll that has secretary clinton up by about five points and that is up to mike pence, trumps running mate to shift the ground and make trump start to improve in those polls in the weeks to come. this is a tough task for him in the debate tonight. to try tog to have
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switch the momentum, which seems to be on the side of secretary clinton. scarlet: both vice presidential candidates are busy preparing for tonight. or about be about them them spending their time defending or attacking the other nominee? see a littleely to bit of a replay of last week. from supporters say he left a lot of attack lines against linton on the cutting room floor and it is an opportunity for his running mate vive some of those about benghazi or the clinton foundation and we will hear from clinton's running mate defense and going after trump for the week that he has had. everything from miss universe to his tax returns that show he didn't pay federal taxes in the 90's. we will probably hear a lot about the presidential nominees
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and not much about the vice presidential nominees. scarlet: how well do they pull on their -- pull on their own? >> both are well respected in their states. the homeirginia, in state where he is holding this debate is well known and well regarded. most of them are not known by the vast majority of americans. be an opportunity for them to have the biggest political stage of their careers and it will be an opportunity for them to showcase what they know and a lot of americans will know a lot more about the methodist debate and if they do well it can probably improve their poll numbers. i know that, for instance tim kaine has had a checkered history with his comments about the death penalty. >> one thing that you will probably hear the moderator talk about is the places where they have different opinions from
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their running mates. supported the tpp trade deal in the past and donald trump has said that is horrible. we saw that he voted for the iraq war which donald trump said was a mistake. pants, and for tim kaine, he has a very different opinion on abortion from secretary clinton. scarlet: thank you. can another reminder, you watch the debate right here on bloomberg television. coverage begins at 8:30 p.m. eastern time. we will be speaking to the mayor of columbus ohio. this is bloomberg. ♪
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let's get you to first word news with mark crumpton. matthew has made landfall in western haiti. the storm started to hit southwestern haiti with torrential rain and high winds. haiti is the poorest nation in the western hemisphere. it is still recovering from a deadly earthquake that hit in 2010. hillary clinton has turned a virtual tie two weeks ago into a nearly six point lead over donald trump in the battleground state of north carolina. according to the latest findings by elon university, hillary 45%ton leads donald trump to 39%. according to two thirds of voters, they believe she won the debate and they now have less confidence in donald trump after his performance. donald trump says he performs best when the chips are down. reversing theg to
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financial state of his company, the trump organization. he still believes he can overcome six days of negative headlines and falling poll numbers. the european union is appealing to greece to meet several outstanding conditions by next week. the eu says that if this happens in time, $3.1 billion can be released to help the country's economy. they will meet in luxembourg on monday to discuss the so-called milestone. global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. scarlet: thank you, mark. the electoral college decides who becomes president. franken county in columbus, ohio is one special location. it is named after benjamin franklin. it has been at the cracks of presidential politics for decades.
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talk about the city's thoughts is the mayor andrew ginther. mr. mayor, it is great to see you. they differ coming in today. it is said that franklin county will be a make or break vote for the final outcome. tell us what the top three concerns are for the voters in franklin, ohio. mayor ginther: really, it is about building an economy that works for everyone. cap one of the fastest-growing economies in the midwest. we have one of the greatest wage growth in the city -- of the cities in the country. people in ohio want a partner in the white house will help to continue to grow our economy and deliver results for the people of central ohio. are six counties in america with the president got more votes in 2012 than he did in 2008. franken county was one county.
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deferential. scarlet: you are certainly in the column of hillary clinton being a democrat and campaigning for her. donald trump has talked about the devastation of job loss in ohio. while it is true that manufacturing jobs have gone down, other industries have seen gains. there is some sentiment there that still echoes with people in frequent county. mayor ginther: there are parts of the state that are not as far along in the recovery. that message i think will resonate with certain parts of the state. , her messageio about planning for the future with green energy and research development really resonates with the people of central ohio. >> we still have big manufacturing jobs. american vehicles being made in ohio. we have international manufacturers in ohio like honda.
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i wonder what ohio voters think of these trade issues that seem to be so contentious, whereas we do benefit a lot, especially in the columbus area, from trade. mayor ginther: you really do have a divided state along some of these trade deals. i think one consensus is that folks are all about free trade as long is it is fair trade and a level playing field. that is so american workers think compete against workers around the world. there is no doubt about it. part of the great economic recovery that is taking place in ohio is about increasing the amount of exports of goods from ohio to other places around the world. ofwe also have a lot entrepreneurship in central ohio. that is because of the size of ohio state university. entrepreneurs there are funded by venture capitalists. regulation is a big concern to them. had you work to keep regulation down?
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which candidate do you think would be best for that? mayor ginther: you be active in retaining skilled talent. we have an active effort across the country to target and highly educated folks to call columbus home. is one of the number one places for entrepreneurs and startups. we want to keep that momentum going. that involve staying ahead of the curve and making sure that columbus is a good place to do business for small businesses and entrepreneurs. thelet: colette is has third highest concentration of fashion designers in the united -- columbus has the third highest concentration of fashion designers in the united states. tell us what the government is doing to ensure that the local stays a competitive avenue and continues to thrive. yes, outside of
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new york and los angeles, you hit it right on the head. thousands work in this industry in central ohio. things that those we remain vocus don. we are lucky ash focused on. that we remain focused on. it is one of those things that we make sure we have a strong, strategic approach to protect that industry and help it to grow. we think there are ways to leverage that industry to provide more opportunities for job creation and economic development in the future. >> another way that could really help is logistics and infrastructure. hear that is a buzzword, infrastructure investments. the candidates have been talking about that for a while. what do you do to improve?
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70 and 71ously have crossing each other there. there are no rail lines connecting the suburbs. what are you looking to do to improve the infrastructure? mayor ginther: we will continue to invest. you know we are within eight hours drive to nearly 60% of the markets in the united states. being such a critically located place with important infrastructure that is needed to leverage that is going to remain a top priority for us moving forward. scarlet: i want to get back to politics here for a moment. back to the campaign currently underway. campaign leader sent out a memo saying that clinton could win the campaign -- when the election without carrying in ohio. does hillary clinton need to win
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ohio? mayor ginther: she is going to win ohio. competitive very and close race. central ohio will be key to that. there are parts of the state where mr. trump's message of frustration and anger might resonate differently than in central ohio. we are going to resonate that's we are going to be the largest county and sent -- we are going to be the largest county in central ohio in the next few years. some urban areas, particularly with married women, the message from hillary clinton is going to carry the day in ohio. >> i can understand the anger and frustration resonating with a lower middle class group of people that have not been able to keep up with inflation over the past few decades, who have seen their wages stagnate. ohio is also an incredibly diverse state.
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central ohio is an incredibly diverse community. donaldre concerns trump's feelings about immigration and racial issues -- more to those people come out for hillary clinton -- won't those areas come out for hillary clinton? mayor ginther: i think so. we are a smart and open community. we continue to grow. .e want to be inclusive we want to build for the future. that i believe connects people with secretary clinton. mr. trump's message is not going to resonate with the diverse, growing parts of ohio. scarlet: john kasich, the governor of ohio, ran for the primary for president. he remains a popular politician in the state.
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endorsehis refusal to donald trump mean in the state of ohio? speakginther: i cannot for republicans and how that will influence their views on things. he is been a great partner to the city of columbus. fought for the cause of infant mortality in the state. i believe he has made a at the highest level in the state of ohio. i respect his willingness to stand up for what he believes in. buckeyes beat rutgers over the weekend. 14-7.an beat wisconsin so, they won but it was nota -- not a thumping.
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before ohio state plays michigan. normally we trounce them. what you expect for the game? mayor ginther: a colossal whopping. this is the closest thing to blue you will see on my body until the ohio state and michigan game. mayor andrew ginther, thank you so much for joining us. coming up, ducati is celebrating its anniversary. we would hear about how they keep their brand alive among the younger generation of motorcyclists. this is bloomberg. ♪
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scarlet: you are watching bloomberg. vonnie: i am vonnie quinn. >> this is what we are watching. we are watching the address of a recent police probe and the outlook of south africa's economy. a a giant lmh is adding german suitcase maker to the umbrella of its brands. >> one of the most expensive cities in the world is seeing a huge drop in real estate prices. we will explain why it is a buyers market in manhattan. >> south africa's primates -- says that theer probe is nothing but political mischief and will be resolved soon. speaking with bloomberg television, he discussed where he sees growth in the nation's economy. >> there are other sectors of the economy that have been growing and will grow into the future.
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agriculture, for an elements of the motor industry, many american companies are invested. our latest investment was from a chinese company that will be building small cars on the african continent with the first time. -- for the first time. buying avuitton is stake in a german suitcase maker. they will pay for 80% of the company. the seller is the grandson of the company. they are known for making the first aluminium suitcase. jeopardyts might be in because delta airlines has a pending deal that might pay its pilots more. the southwest pilots union wants to renegotiate some of their sections of their agreement by the end of august. it is a buyers market in manhattan. there was a dive in the third quarter.
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the number of resale apartments on the end of september was 20% higher than it was in 2013. it was the lowest point for listings. >> time now for the bloomberg quick take. the united kingdom shocked the world in june by voting to leave the european union. was britons thought the eu expensive, out of touch, and a source of uncontrolled immigration. i 52% supported the move to 48 percent. it raised questions about the consequence of a united europe. prime minister david cameron did a push for the uk to remain in the 28 nation bloc. byresigned and was replaced teresa main. there is still uncertainty about
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how exit will work. mayne says she will continue the start of the negotiation. 2017. end of march some people immediately argued when itshould pull out first entered the eu. another call to leave after the signing of the maastricht treaty. it created the european union. skepticism kept them from adopting the eu currency when it was first announced in 1999. a populist backlash was created against the european elite. the question is now whether the u.k. can strike a brexit deal with europe that gives it control over immigration while retaining access to the eu's single market of 500 million people.
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the economic backbone of the world largest trading block. you can read more about brexit and all of our quick takes on -- bloomberg.com.
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♪ is "bloomberg markets." i am scarlet fu. ducati is celebrating its 90th birthday today. looking ahead to its next 90 years, will accompany stick with that strategy. -- will accompany stick with that strategy? ceo of ducatithe america, jason chinnock. about thetalk to you
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new models and the market you are going into. people think of duke as the maker of superbikes. you recently put out a that treads more closely on to bmws territory. what is the strategy for building out models? jason: that is a good question. ducati has traditionally been based in the superbike world. that is meant to help us go into these new ventures. the idea behind this is that we know people fall in love with the brand and some of the characteristics of our brand. we want to bring product to market that will allow them to find their entry into our world. the new models have actually allow that over the past of this -- over the course of this past year. >> another thing you have been doing is producing some of your bikes in a more local market.
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you produced the scrambler or pieces of it not in italy. are you looking to get closer to those markets that are getting bigger and bigger for you? obviously, asia is a huge market that is growing for ducati, as well. it is an important part of our global strategy. us to have market production in those areas as well. we limited production of those models to areas that we identified as having the best opportunities to grow. >> one of the interesting things -- i have been a fan for a long time. one of the most interesting things to me has been your partnership with lamborghini and audi. you used to run lamborghini here in north america, as well. how does that play into your growth strategy? do you collaborate with them on marketing and technology? jason: if you look at the new
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weel into wrote -- enduro, have some interesting, innovation and technology. we have lights that allow us to measure when the bike is turning into a corner. the lights turn on as you move through the corner. that is something we had been in development on for years with audi. it has allowed us to fast-forward a lot of technology. in regards to some of the brand activities -- this is one thing we have done over the years, we have worked with both of them to create many opportunities. it helps us to create -- build our brand recognition in north america, as well. >> many of the leading head technology companies are out there. does that help you to develop tech in any way?
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with ducati cornering technology like that -- you always seem to be on the leading edge of technology with motorcycles. jason: we are a national sales company. we are exclusively responsible for the marketing and sales of our product however, we have the opportunity in some cases to collaborate with companies locally that help us to bring some of that technology back to where most of the development is done in italy. >> how about getting new writer groups?-- rider we don't typically think of women as a motorcycle group, or wightman like you or me -- white men like you or me as motorcycle riders. however, you need to continue to expand. have you do that? our brand is about style, sophistication, and performance. a lot of women gravitate towards
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those core values. it is important that we bring roddick to market that supports that entry into the motorcycle -- that we bring products to market that supports that entry into the motorcycle world, as well. we actually have some new products coming out this november in milan at the big motorcycle expo that will allow us to address the opportunity intontry writers -- riders the core of ducati. that is exciting. racing?bout we have corey alexander, who is riding onlocal hero, a ducati. how important is that your marketing push? jason: it is incredibly helpful for our marketing push. it helps with the development of the moto america series of races. they are really starting to take off. we are trying to get privateer
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teams to get together and campaign for two toddy. we have quite a few irons in the fire -- campaign for ducati. we have quite a few irons in the fire right now. >> jason, think you so much for your time. jason chinnock, ceo of ducati north america. we were going to talk about globetrotter were several different guys ride one bike around the world. however, we just had too many questions. scarlet: that does sound right up your alley. up, we have more bloomberg. this is bloomberg. ♪
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scarlet: good afternoon. i'm scarlet fu. welcome to "bloomberg markets." ♪
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scarlet: from bloomberg world headquarters in new york, we are covering stories from san francisco to johannesburg and manila at this hour. the dollar has climbed the most in two weeks. spurred talkshave they will increase rates this year. bearers weighing in on a sustained selloff may have to wait longer times, five years to be exact. that is what majors is addicting. europe hear what roger altman has to say about that -- you have to hear what roger altman has to say about that. crime -- finance minister says that the investigation into him is nothing but political mischief and will be resolved soon. we are halfway into the u.s. trading day. ramy inocencio is standing by with the latest.
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mark: -- ramy: we have deftly seen some up-and-down trading today. right now, we are definitively at session lows today. the dow is down 0.31%. not quite as much for the nasdaq. let's take a look at what is been happening in terms of the effect on the u.s. 10 year yield. you can see it is up by five basis points. this is it biggest jump since september 13. the yield is standing at its highest in exactly two weeks. not only for the 10 year, but is also rate hikes having an effect on the bank stocks. let's look at the boards. all of them are generally rising. we are up 2% here. this is its highest since the start of the year. bank of america also up 2%, its highest in a month.
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jp morgan is up over the past few days or so. wells fargo is seeing a little bit of green. for sure, they are going to see it go down after the fake accounts scandal. a sick a look at what is happening in terms of other readers today. today.-- other gainers google and called it are up, after we just -- and alphabet are up after we broke the story about the new google phone called, "the pixel." news of a tank over -- takeover interest coming out of hong kong should black & decker -- hong kong. black & decker shares are soaring after. apache corp. is very speculative right now. to thep by about .5%
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potential takeover interest. us take a look at the commodities. gold saw the green, but we are seeing some losers with falling -- increasing interest rates. its futures is seeing lowest in the past three years. it is down the most since july. but take a look at the british pound and u.s. dollar. -- let us take a look at the u.s. -- british pound and u.s. dollar. it is now down at the low of the day. with the latest news coming out from london that theresa may says she will give no special fever -- favors to the city of london, likely causing an effect. scarlet: ramy inocencio, think you so much. let's get a check on bloomberg's word news with mark crumpton. hillary clinton and donald trump will be far away from virginia tonight, but they will
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be tuning in as the running mate meet in the only vice presidential debate. viewd trump is excited to the proceedings from the trump hotel in vegas. secretary clinton is excited to watch from her home and chappaqua, new york. bill clinton took a swipe at obamacare while campaigning for his wife in michigan. he called the affordable care law, "the craziest thing in the world." clinton's efforts to overhaul the health system failed in the 1990's. negative -- has ended negotiations with russia over syria. john kerry spoke with -- spoke in brussels just a few days after the u.s. announced they were pulling out of peace talks. >> we will continue to pursue sustainable and enforceable seizing of hostilities of the country. hostilitiesf
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throughout the country. russia knows exactly what it needs to do. kerrysecretary john accused russia of turning a blind eye to barrel bonds. european parliament has approved the most sweeping accords to fight pollution. that means it is likely to calm into force a few months from now. last year, more than 190 nations agreed to work for capping global temperature increases. global news 24 hours a day, powered by 2600 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. scarlet? scarlet: thank you, mark. a major call from stephen major today. in his latest note to clients, he said that yields were no longer be higher in five years time than they are today. on, "bloomberge
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surveillance" this morning. >> the structural backdrop to markets is getting worse. it is not getting better. i look at the charts, and everyone has the same charts over the last 30 years. the yields have been falling. this is not a new thing. we all understand this structural backdrop. thatare people thinking the problems will suddenly go away? i think it is quite modest compared to what others are saying. >> let's bring this chart up. stephen major, the other part of your report -- it was a lengthy report. daum ago with a great moderation which -- down we go with a great moderation, which stephen major
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says will continue. why is this a surprise? >> the facts are quite clear. in the last 10 years, there has on developedase markets. the sovereigns have increased quite significantly. emerging markets are even worse. but i think many people are missing are the private sectors. the italian banking center, chinese corporate's, australian households, these to me are the overall picture. there's just too much debt. i do not really get the cause of fiscal loosening. it is an easy call to make, but it does not fit with the data. chord wheny struck a he said everyone was looking at the same charts. you spoke about the ways that different analysts look at
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things differently. what you think the mass market is getting a most wrong? >> there is this hope that things will get better. i can be accused of being a bit grim. this outlook does not really suit any of us in the financial services sector. we all want to be optimistic and hope that things will get better in the future. i still do not really get the explanations that people have as to why the 30 year bond yield chart will start reversing. it seems more like a help than a robust analysis. >> just to be clear, you are not predicting a recession? >> well, most people recognize that in the next five years the united states will go that way. it is probably less than five years. that is why when i look forwards, i am thinking that anything above 2% for the five-year rate in five years time is on the high side. i do not see them getting to that number is in the next two
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or three years. so actually, five years forward is looking bad to me. >> you go out to 2021. when will we be seeing the collapse in the expectations? when will we see the collapse of the dream and hope of yield higher? >> the reason i looked five-year out is to try and get a clearer picture for the next one or two years. i think the danger is that many people are only looking at one thing at a time. there is the united states election, all the political .ackdrop in europe my concern is that nothing much is really going to change. i know people are talking about the rise of populism. i just do not see it. thatu look at the path of long-term chart you referred to,
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it has been coming down quite systematically. i imagine one year out it will be even lower. -- ie not there yet imagine one day it will be at normal levels, but we are not there yet. scarlet: later on, roger altman was asked to respond to stephen majors call. >> it is possible. every time we have expected rates to move up they have not. every time we thought they could not get lower, they have often got lower. that would not be my back. -- my bet. view,not the mainstream but it is possible. it would not be my bet, because i do not believe the rates will get lower. he is forecasting them to get lower by year-end. no one would bet their life against it, it would not be my
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bet. i also think you are going to see, over five years, some easing up from the central banks from the hyper aggressive monetary policy they have been pursuing. it is a lot more possible today than it was a year and half ago. >> it does say something kind of sobering about while -- long-term global economic growth. if you look at the latest data from world trade it is -- >> if you look at the latest data from world trade, it is rather discouraging. it is so far below what we have seen in recent years that it ties right together with a lower, longer scenario. scarlet: that was evercore partners chairman roger altman ."g on, "bloomberg coming up, the takeover of monsanto. we will have the charts you want to know before the data comes out tomorrow.
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this is bloomberg. ♪
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♪ scarlet: this is "bloomberg markets." i am scarlet fu. a deal for the takeover of monsanto faces some antitrust regulations. german lawmakers have already expressed their concerns over the merger. into monsanto's data in today's segment of, "the numbers do not lie." this chart shows the proposed deals of the market reacting. monsanto tops the list there. buyersve lacked behind
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128 -- $128 a share proposal. it would be the largest takeover of a german company. it worse the next biggest which was the purchase of chrysler. the move reflects a boom in the industry as the number of players tricks overall. plan -- also making to is also planning on making a purchase. how buyer would look if the deal goes through. the blue part of the bar reflects monsanto's contribution. health care would become buyers biggest business. the white growth is monsanto's growth. they have posted four straight quarters of decline in u.s. farm revenue. this trend help to push monsanto to the bargaining table. u.s. regulators are likely to advocate for the selling of some cotton asset in order to
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alleviate highest in the industry. -- tieups in the industry. affect the trucks we take and how we grow our food going forward. they will release their earnings before yesterday's opening. for an update now on tech movers, i want to head over to the nasdaq and abigail doolittle. abigail: from a macro standpoint, it still seems like a funky date with the nasdaq. loss is not to huge here, but something feels off and almost. . eery. almost it would be fitting to see more here. it could be on the upside, but as we look at the chart of the nasdaq 100 this index -- basically a measure of volatility in the market. it seems to me a mover on the downside.
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recently, we have had this index go back above its 50 day moving average. it suggests that this index could arise to the top of the range. it could even move about it. this chart suggests there could be some onside again for nasdaq stock. for today, what is behind the directionless trading, there are not huge moves also not a lack of news. again, there is this funky trading feeling. -- thethese big boosts winners today coming in from their high, that includes alphabet, apple. again, overall, not a lot of news. do haveof it, we something positive -- four alphabet, we do have some news, they have revealed their new smartphones to compete with apple's iphone. scarlet: yes, there seems to be
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a lack of a particular catalyst for the trading action. is there one major mover? sky works is a major mover. koetter equity has upgraded sky works to a by. -- buy. we are hearing there could be a dark course inquiry to compete with qualcomm. some interesting movement in the dark course market. scarlet: abigail doolittle, thank you. coming up, the rollout of new products that are born from some of the new purchases. we have the details for you. this is bloomberg. ♪
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♪ scarlet: this is "bloomberg markets." i'm scarlet fu.
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salesforce is unveiling new products as a result of some purchases. a big one it was revealed today. for more, let us go to "bloomberg radio's" carolyn massar. >> scarlet, think you so much. we welcome everyone on bloomberg tv -- inc. you so much. we welcome everyone on bloomberg tv. -- scarlet, thank you so much. we want to welcome everyone on bloomberg tv. salesforce it made some interesting purchases and are now unveiling new ideas. -- new products. >> what they are saying now is that is if microsoft gets control behind the data of linkedin, they will be a far bigger competitor in this space. they will be able to stifle innovation. >> you follow this company in this sector for bloomberg. you think this is just sour
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grapes from salesforce that was interested in this link in the property? increasede seeing competition from oracle. microsoft dynamics is not as big as salesforce's products. they are trying to be much bigger in this space. the potential is that if they are able to go through and compete the linkedin acquisition , they would have data on several million -- 450 million people. take a look at their product and create something much more powerful. that is what is scaring salesforce at this point. >> is self force right in their move? >> it is very unusual. softwarecompanies in are buying data assets.
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ibm has bought a couple of health care companies. there is a lot of rumors about twitter being purchased by somebody. at the end of the day, these companies when they buy these assets will have to share this information with the rest of the community. otherwise, there could be some regulatory issues. >> when is it too much information being shared? when you have to start raining that in? >> i think that will be the biggest thing for microsoft to figure out with the privacy regulations around it. they will have to jump through a on how they are going to be using the data. remember, linkedin was not made for a sierra platform and they first launched. >> this process of microsoft buying linkedin is going to take longer if european regulators do start to look into this. >> it is possible. that happens though when microsoft buys anything, or when
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google buys anything. everyone once to look and see how it will shape the competitive landscape going forward. , doesthis deal gets done it -- you spoke about the possibility of microsoft building this network. does that mean that salesforce also us to look for some kind of acquisition here? >> they had been doing a lot of acquisitions. they had been improving their product portfolio. they have their marquee product -- their flagship product, and it is not growing at the same rate that it was. it is just getting much older. they are looking at more opportunities to grow and acquisition is a good way to do that. >> what about twitter? a hard sell in our view. the information that salesforce needs from twitter, they could easily ford a ownership -- create a partnership where they are already getting that
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information. if you have a social platform, many people use software to and that that data in their own product. it is hard to imagine anyone buying those products and then shutting it off for everyone else. it is not make sense for how these platforms have been built. >> scarlet kicked off this segment i talking about the other acquisitions that salesforce has done. they are an inquirer. >> they have inquired a lot of products. they have a financial aid product. is all just part of a bittersweet that is anything sales related, marketing related, customer service related. any time and they will do it. >> do you think anyone will come and ask for regular readers to look into this microsoft deal? it is interesting to see cells
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force come out so front and center. >> they wanted to buy it themselves. >> that is why i said sour grapes? >> possibly. >> all right, we will leave it there. scott, back to you. scarlet: you can catch more of carolyn masters radio interviews on sirius xm or the "bloomberg radio" app. coming up, we would hear from morgan stanley ceo and revolutions ceo in our walk to talk segment. this is bloomberg. ♪
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are you on medicare? do you have the coverage you need? open enrollment ends december 7th. so now's the time to get on a path that could be right for you... with plans including aarp medicarecomplete insured through unitedhealthcare. call today or go online to enroll. these medicare advantage plans can combine your
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hospital and doctor coverage with prescription drug coverage, and extra benefits all in one complete plan for a low monthly premium, or in some areas no plan premium at all. other benefits can include: $0 co-pays for an annual physical and most immunizations, routine vision and hearing coverage, and you'll pay the plan's lowest prescription price, whether it's your co-pay or the pharmacy price. or pay zero dollars for a 90-day supply of tier 1 and tier 2 drugs, with home delivery. don't wait, call unitedhealthcare or go online to enroll in aarp medicarecomplete. in new york i am scarlet fu, this is bloomberg markets, let's get you started with the headlines.
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100 40 five mile per hour wind spirit of the category four -- stormrooted trees uprooted trees. 84 deaths were reported in the dominican republic. that brings the death toll to at least seven. matthew is heading north toward cuba. clinton leads donald trump by six points in a new national survey. in the edges trump monkey tracking poll. libertarian gary johnson gets 9%. the green party's joel stein has 3%. vice president biden is criticizing donald trump percent jesting military personnel and veterans with posttraumatic stress disorder aren't strong
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enough to handle the horrors of war. president said trump is not a bad man, but he added, "his ignorance is profound. trump said if he is elected president, he will make improving federal and mental health services a top priority. the u.s. state department is considering a pallet program to allow american citizens to invite in a sponsored refugee. to open newed sources of funding as anti-refugee sentiment in congress threatens resettlement programs. they also pay for airfare, accommodation, and other daily living expenses. local news 24 hours per day powered by 2600 journalists and analysts in over 120 countries. >> time now for walk the talk where we look at pressure points for social change.
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bloomberg launched a financial services gender equality index. since the 26 members of that index began floating data back in 2014, the percent of female board members and women in management have all increased on average. realize that gender equality is not only the right thing to do, but quantifiably better for the company as well. report shows stocks with a high gender diversity have delivered superior risk adjusted returns. with thel caught up ceo at the morgan stanley executive women's conference last week where he spoke about why it is important to bring these women together and how he is thinking about the future of leadership. >> for us it is bringing all the senior executive women together. back a couple of great alumni.
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executives from around the country. it gives them a chance to share views on leadership and what is going on in the economy. from what is going to be our big message? about puttingk together a leadership team in organizations, how to think about succession planning, how to think about teams that are competent and cohesive. try to think about a leadership team in terms of five years. and then how to make sure the feedback we grow and develop is real and in shorthand. t tesh oneran veteran ceo says it needs to be a bias towards inclusiveness. betty liu spoke with the ofounder of ae -- cofounder
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aol. he is a visiting and investing in startups in omaha, denver, so lake city, albuquerque, and phoenix. we need to level the playing field in terms of opportunity. a lot of people are left behind. we just have to level the playing field. i focus on the rise and rest of the regional playing fields. at thee has a best shot american dream and we need to do a better job of creating that environment around diversity and more of an inclusive economy. raised half a billion dollars to invest outside of silicon valley. how will that change your portfolio startups going away from silicon valley? ourhat has always been focus, not to say we aren't
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proud of the great innovation. everybody is focusing there and investing there. we decided to invest with great operative best with great entrepreneurs. a great value of us as investors. there is not as much content -- not as much competition with those investors. we now find dozens of companies in these different cities at 52%. shows there are great entrepreneurs and if you have a and towards inclusiveness an intentionality around inclusiveness, there are great opportunities around the country. it influence whether you are going to invest? things we look at, we try to make sure we are tackling these issues such as health care and education.
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how do you really tackle that? it is also the smart thing to do. >> that was a chairman and ceo of revolution. coming up, canada tries to close tax loopholes to foreign buyers. but as a housing crash still in the habitable? -- still inevitable?
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>> this is bloomberg markets. canada is trying to rein in costs. ,ew measures to mitigate risks
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tightening mortgage ella bell -- mortgage eligibility. surviving the canadian real estate crash. >> it is a major bubble, three prices from 15 years ago. my research never happens. it happened a couple of times. of course we experience the united states with the bubble. the bill -- the bubble is bigger before it bursts. there is this personal debt to level. we are at 2% gdp. there are only five countries that have elevated to a private sector debt. that is a big warning site. >> you have inflated prices in those two cities.
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>> you don't see the home price appreciation right -- appreciation rate. that is kind of catching people off guard. these are not targeted measures. last little 500,000 change. this one on the mortgage rules. this will affect the provision of credit across the board. >> can you even do that? >> i don't think so. these measures are fairly small steps. you only get your fixed rate for five years in canada.
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the qualification is going to be on a much higher interest rate. the four qualify for a $60,000 mortgage, now qualifying for a $500,000 mortgage. that is going to make it difficult for them to via house. house prices have increased pretty well everywhere. where i am from, host prices have tripled as well. was the author of "when the bubble bursts, surviving the canadian real estate crash. joining me is amanda lang, who toronto. wise the government moving to call the markets now? posting that extra 15% tax, we have seen vancouver housing crisis level off. >> it is part of a broader picture.
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there are some structural problems with the way we are financing the purchase is of homes here. the market here has remained pretty robust even nationally. get to 30% when you're looking at vancouver. concern here is that a record low rates have drawn in many mortgage holders that could not afford the higher rates. actually have to work out whether you can work that same mortgage as a higher rate. that will have a real cooling effect. by claiming it was your principal residence, there is a lot of that going on, foreign money. that will roll back.
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>> you can make that argument. it is a federal assistant -- federal assistance for insurance. the ones that often issued a mortgages and package them to the mortgage backed securities market. riskdon't have as much because of this taxpayer back stock insurance system. it seems the federal government wants to make them share more of the risk in the event of a default. so that they are more careful with their mortgages. is exactly why was so hard in the state for any government to cool the housing market in 2007. it is not like it is some ponzi
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scheme. percentage of the gdp comes out of the housing market. we want to cool it down so it doesn't pop. been a lot of talk about a housing bubble. why is this taking on added urgency at this point? >> i think it comes down to how long it has gone on. more and more portfolio managers are starting to do the math on what a big housing market correction would due to the overall economy. there are some that see a real recession coming out. aspect to it. rates are going to go higher. going to we are going to start see rates moving in that direction.
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a fully one third of people sitting on mortgages now would actually be ok at the higher stress tested level. time for people to wake up and make sure they are not insuring mortgages that aren't going to be good. >> thank you so much. let's move now to central-bank policy. loretta mester says she saw a compelling case for moving the fed funds rate gradually up from september. >> i don't think we are behind the curve yet. i thought there was a compelling case of taking a gradual step up. the path for the medium path across participants is a gradual path up.
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we've seen 180,000 jobs added average, this year on which is a pretty good pace. inflation still below our 2% goal. monetary policy has to be forward-looking. there was a compelling case of moving the rate of gradually. there are some people who think you want to curtail the expansion. the reason why it was important to move the rate up is we want a sustainable expansion. consumereek the spending was weak enough that the atlanta cut its gdp tracker down to 2.4%. the first half the gdp barely
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grew over 1%. maybe the weight could be a little bit longer. when it is really not all that strong yet. >> the first half of the year growth was around 1%. i think around two to 3% in the second half. we are going to be looking over trend over the next two years. that will be strong enough to put some downward pressure on the unemployment rate. i believe it is in place for inflation to move gradually back to two. in my view inflation expectations are reasonably well anchored. i think economic conditions are going to be such that we are going back gradually. we have to be preemptive to make sure we are moving the interest rate up so we can keep the
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expansion sustained. >> the fed chair recently said the cases strengthened for a rate hike. is onms like the economy an even better footing for a rate hike -- rate hike. >> i would conclude that all meetings are live in i thought the case was compelling to take another step on the gradual path. if the data comes in as we anticipate, it will be consistent with my forecast over the medium run. i expect the case would remain compelling. we are going to look at all the data that comes in now between november and december. we like to look at all the incoming information. if the data comes in as consistent with what we have been seeing, i think it would
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still remain with best remain compelling. the case will be compelling. news onve some breaking the company. shares of both those companies are searching. have bridged and evaluation gap that has cost months of disagreement. reached a final agreement and an announcement is not yet in a mint. the chicago tribune and the baltimore sun, anywhere from 1850 to $19 per share. the two have not yet agree to anything. the talks could still fall apart. we will keep an eye on these for you. this is bloomberg.
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south africa is at risk of losing it investment level credit status. the debt is at one level above junk. the prime minister spoke earlier about the police probe against him and how foreigners are still very invested in the nation. >> it is quite an easy sell. we have had huge inflows into the bond markets. at the moment foreigners over 35%. it remains a very attractive destination. we have a very loyal and diligent group of investors. as far as the investigation is concerned, it is no more than political mischief. you have seen consequences in the u.k..
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and the police don't get involved in those situations. i'm sure we will resolve these difficulties. the economic institutions made up of extremely excellent professionals and ourselves to keep the economy on track. and we go into our country that we can create conditions for growth and jobs. even contacted by the national prosecuting authority says that august? do you know whether you are still under investigation or not? media istest in the they believe they don't actually have a case. that's why i call it political mischief. that's why i'm here.
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>> the one thing investors want to know, how do you answer that question, when investors ask you if you're going to be stepping down in any shape or form? what guarantees can you tell them? >> anyone in the world can say i'm going to stick to my job. and it is the head of government of state that determines whether you continue or don't continue. i am in the job and i have a responsibility to deliver expenditure to the framework for the next three years. >> that was south african prime minister. for what it means for the country's economy, joe weisenthal is here. out the imf warning
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in his world economic outlook that tensions afflict the u.s. political scene, where anti-immigrant and anti-trade rhetoric have been prominent in the start of the red test start of the presidential route. you have to think that will curb economic growth. >> the imf coming out with a fresh forecast for economies all around the world. except too remarkable characterizing the economic situation as sideways. anti-trade rhetoric around the world. their cloth -- they're pulling at it at record pace. a surprise columbia referendum. everyone expected that the pass. something we had an inkling of heading into this
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year. and it could all be capped by the u.s. presidential election. >> there is going to be italy in december and for -- and french elections. it looks like this more inward looking politics getting more popular. have anll certainly effect on the metrics. we will be talking about that later on this afternoon. we are also going to be speaking about the u.s. stock market. strategist andl that is coming at 4 p.m. eastern time. this is bloomberg.
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11 a.m. in san francisco and 7 p.m. in london. i am matt miller. >> welcome to bloomberg markets.
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we are live a bloomberg world headquarters over the next hour, plus covering so test covering stories out of san francisco, china, and the united kingdom. dropping to the lowest levels in decades. -- u.s. dollar trump and clinton continue to campaign for the attention has a turned to their running mate. to expect.cuss what and google took another big leap in the mobile device market, revealing its pixel smartphone. ramy is joining us now with the latest. remy: we are across the board. we were hitting our

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