tv Bloomberg Markets Americas Bloomberg August 22, 2017 2:00pm-3:30pm EDT
julie: we are live at bloomberg headquarters. here's the top stories we're covering on the bloomberg and around the world. with elio is waving the red flag again, saying he is tactically reducing risk. the world top minor is changing course -- php billiton is in talks for a buyer for its shale assets. and apple is celebrating the 10th anniversary of the iphone with a makeover. we will go under the hood to look at the features of the iphone eight. u.s. markets are closing in two hours. are check on where stocks trading with taylor riggs. taylor: kind of a risk on field today after a recent pullback. with dip on the
buying there. nasdaq 100 highest since june. those are some of the tech companies i'm keeping my eyes on. we are looking at a pretty broad-based rally. you can see nine out of the 11 sectors are green, showing a broad-based rally. i want to look at some of the tech stocks and some of the big companies. not a lot of news behind that. a note this morning from experts saying president trump after his turning at night was new leaf, showing the can listen to leaders and perhaps getting some criticism, showing he could really listen in terms of when it comes to routes on the ground.
also feeling that as we round out the other asset classes, we are going to look at the dollar index because we are waiting jackson hole tomorrow, a speech from mario draghi and janet yellen. that risk on yield pushing the dollar up higher, about .3%. maybe we can look at tax reform now. finally, we are looking at the 10 year yield. the central bank governors that will be speaking, we have been hovering around that 20 range. a little overall risk on here with a stronger dollar and bonds i'ming off fearful julia: going to pick up there as investors try to move past recent local turmoil in backngton, ray elio is with a new note of caution, saying he's reducing risk because he is can learn about
growing internal and next journal conflict leading to impaired efficiency. he doesn't seem to be the only one. risk aversion measures have been rising. conflict ready? the markets still intact, get on with it? guest: it's hard to say. it seems safe to conclude the amount of medical dysfunction in the united states seems to grow every day and i read something like the biggest fear of parents and their kids marrying is now marrying somebody of the opposite political party which says something. there does seem to be a structural divide that would support trump no matter what and slightly more who would oppose them no matter what and that doesn't make for a harmonious
backdrop. julie: if you look at post election, there was hope on at least part of the business community that there was going to be some positive measures achieved and you have a chart that shows this. specifically this is political optimism? this is almost hidden on the right side of the screen. this goes back to 1988 and then -- i'm going to try and zoom. it shows a big spike up post election. guest: there is an unprecedented amount of optimism that flooded in, at least the respondents to the michigan survey after the election of donald trump which has sort of receipt about halfway. oh may remember mr. delly
wrote waxing lyrical about trump breaking out his iran references and john gault was going to be treasury secretary or something. class that is quite interesting in that context. what is interesting is he doesn't talk about the markets very much. it's mostly talking about the divide, almost as an afterthought, he says i'm tactically reducing risk. ,hen you look at this chart when you look at the tender of the country right now, how do you translate that into what it's going to mean for the financial market? thet: you need to look at confidence of real actors in the economy, not only consumers and broad consumer confidence the business confidence. moment, business
confidence remains high. similar to that charge, you had in thee in rise aggregate economy after the election and that has not really receded. what we have seen recently is the ceos and corporate bigwigs defecting from the administration and the issue is is that just political orediency or amoral qualm does it reflect a loss of confidence in corporate america over the direction the company -- the country is going in? that would have a more negative implication is businesses conduct their activities accordingly by investing and hiring less. julia: in the short-term, are the fundamental getting lost or blurred by the political noise?
the s&p went nowhere fast. rally upjustifying the to this point as opposed to the rally going forward. guest: it's the classic buy the rumor, sell the stock. fundamental fundamentally justifies a weakening of the dollar but it has weakened more than traditional drivers would suggest which means we can pay to some sort of disquiet not only from domestic but international investments. time, whenhe same you talk about the underlying confidence in the economy, the showeds seen we got past relative strength in the earnings but it didn't seem to translate what happened in the stock market. how do we navigate that going forward? everyone says it's about the
fundamentals and the fundamentals are good, but if they don't matter as much anymore -- guest: earnings season was good, but if we look at the actual levels, they were not much higher than they were three years ago. argue it was already baked into the price. we look at places like walmart and that was actually white lousy. it's a what have you done for me lately market. the investors will be forward-looking. if some of the guidance is quite right and there's a backdrop of political unease and that's a reasonable rationale for taking when we have table had a monolithic straight-line advanced for nine months. that can only continue for so long before there is some mean reversion. it would require
stronger policy to justify valuations as well. if you are concerned about the hase and stability, if that an impact, at some point, that does matter. the trump bump is all but gone, but to justify the rallies, we are looking at fundamentals. we have to move on. now let's check on the bloomberg first word news with mark crumpton. mark: a top u.s. commander for the middle east is the first new forces will arrive in afghanistan within days or weeks. president trump is not how many additional service members he plans to send. last night, the president declared u.s. troops will "fight to win the long war in singapore, then
remains of some u.s. sailors have been found aboard the damaged u.s. ship. divers discovered the remains in mccain.john >> while the search and rescue efforts continue, i thank our singapore partners, our malaysia partners and everyone who has responded with urgency, compassion, and tireless commitment. mark: authorities found an unidentified body. 10 sailors were missing after the mccain and oil tanker collided. charlottesville has decided to cover statues of two confederate generals in black. it came after hours of anger fueled public debate in the wake of the violence earlier this month. some blame the city council and mayor for not properly policing
rally. said the's president country is the target of world imperial powers. president maduro said the same powers that view them as a rebel in the 19th and 20th centuries are going against the nation. venezuela has been caught in internal strife, pinning the president against an oppositional congress increasingly stripped of power. the government has been at odds with the white house after president trump said he would not rule out a military option in venezuela. global news 24 hours a day powered by our 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. sorry for keeping you waiting. top minor the world is in talks to sell u.s. shale assets after public skirmishes with activist investors.
julia: this is bloomberg markets. i'm julia chatterley. julie: and i'm julie hyman. julia: after months of pressure, the world's biggest miner, hp litan, announced it is in talks to sell u.s. shale assets. andrew mackenzie discussed the plans to exit u.s. shale on bloomberg markets asia. >> for now, our strategy is a small number trade sales, but we are keeping the other options there so we can proceed with a
now,n apple pay's, but for we think a trade sale is best. >> how quickly can you make an exit? >> we have to be patient. we know what our businesses are worth and we will add to our businesses through our value and modest tech -- modest investment. on the other hand, we don't want to lack urgency and that's why we have other options in the wings if trade sales are too difficult to execute. >> it's interesting because we heard from a french energy giant assets andto buy the one thing they said his u.s. shale is not at the top of their wish list because it is too expensive. foremostree first and about it being too expensive and does this concern you about finding available and interested
buyers? >> we have sold some parts of our position over the last two years. this is not something that has happened in a sudden way. half of the remaining half was already on the block. there were a lot of trades that happened. what generally happens on the trade sale is people get proper interviews involved and do proper assessments and they seem to do what it's worth. they are dealing with different types of acreage that have gone into different productivity. >> does the decision to go for a total exit -- was that the impetus from these activist
investors? >> no. working toward this two years ago and we made it clear to most investors that when we went around the world, we saw very limited opportunities to expand our business in oil. werelt the margins and gas not going to be attractive to us relative to the other businesses we can invest in. we started pivoted back toward conventional oil and gas and that means at the same time we were cutting capital in shale, selling acreage the way i described it, we significantly cut back conventional oil and i've been able to announce some real successes there. julia: that was andrew mackenzie speaking on bloomberg markets: asia. joining us now is an analyst who shale assets could yield between $8 billion and $10
billion he joins us from denver. great to have you on the show. do you thinkally other potential buyers will be looking at? guest: good afternoon. the permian and eagle but are is assets and the biggest likely to be on the permian. eagle for it is a bigger asset, but the upside potential within the permian should drive the value. julia: one of the potential purchases there's -- purchasers here is anadarko. how could they monetize this better? guest: the earlier comment on is u.s. shale expensive is a fair
one. anadarko with its leverage ask like a checkerboard. in addition, anadarko's infrastructure that is being built out sits on top and next acreage, so they are elements that they are building and elements they are going to expand and they can hand in the acreagey put in into the anadarko position within the permian. julia: anadarko has been mentioned as a bidder. who do you think will actually emerge? i think there will be a lot of interest and a natural gas assets will be more difficult to transact. we believe there is a situation when you look at the position , they are very fluid within each other.
and it's more consistent to develop consistent blocks of acreage and you might be able to have a true win/win/win situation for all three parties for anadarko, shale and the hp for top julia: the company has left over a possibility of some kind of ipo option here. what do you think is the most likely? the fact that the prices are significantly higher if it had not bounced off a 12 year low. it is certainly the case that a sale would be preferred. it is clean and easy in the fastest amongst all of those. is thatistic asset there are a lot of very high value public companies out there that are permian pure play focused and that will be a consideration the company will
be looking at. what do you think bhp did not do right? did they just not have the correct password -- patchwork of having the economy of scale or are there things they could have done differently? guest: i don't know if there is an element of not doing anything right. there has been a seismic shift and technological shift as everyone has been forced to go to $30 and back into the 40's and regenerate their businesses and that has in a challenge and it still an ongoing problem for many of the firms. it is a systematic change taking place. at the assets of high-quality and certainly one that can be competitive in the broader economic landscape within global oil. julie: thank you so much.
can be dialogue over the nuclear program. time for the bloomberg business flash and a look at some of the biggest stories in the news right now. the chevron chief executive officer is said to these that thing down after seven years. the transition is expected to be announced next month. is a candidatean for the role. a global market downturn is morgan stanleyd have cited trading pattern shifts. merrill lynch have cited a lack of reaction to earnings outperformance. citibank is still projecting a late cycle peak before a bear market begins. the women's health unit says possible u.s. buyers are considering a portfolio that could bring in up to $2 billion. the israeli drugmaker is looking to offload the unit to reduce
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the big loser today -- oj down about 3.5% at the moment. u.s. orange shoes retail sales fell nearly 9% in july and early august. the usda says that crop looks potentially demand, high. of crudest source could help erode the global glut. after the initial leg up, we have seen quite a bit of choppiness in the oil market today. gold slipping as risk on sentiment takes hold. investors are waiting for mario draghiwhere and janet yellen are scheduled to speak. a year before the financial crisis, there was a crisis that often gets overlooked. we are talking about a crash of
funds in 2007. while the funds that back and address the shortcomings, there theso many new products on market that there are questions being asked about whether the industry is prepared for another crisis. joining me is the head of marketing research management at a qr capital management. of the face of wall street. a long introduction, but a worthy one. the universe has changed a great deal -- i hate that term because in terms of the number of investor products out there, it is a different world. much: it is, and it's a underworld and for the first time, we have a lot of retail investors. there's about a trillion dollars in quantum hedge funds and in
etf's, helped by retail investors. another one, i'm a retail manager and i just try to figure out how i wouldn't take a different path than i would in 2007. julie: what would that be? there has been this proliferation of quantitative driven strategies in the market, so one would think they are more important than ever, but you posit that it won't necessarily take down everything? guest: the big difference this time is there is less leverage. retail products are primarily on ofered, so i think in terms effecting the market, it would not be huge. we could see a massive deleveraging and in one month, it would barely ripple. is a lot oft do
damage to people putting their money in these products, so anyone invested in these things should think about are you prepared to take a month where you underperform the s&p 500 or whatever the benchmark is. if not, you are better off getting off now and putting it in a -- in an index fund. julia: you are saying the liquidity provision if you want to pull your money out or the ,ark to market, retail investor a more sophisticated investor is different question mark -- is different? guest: on the other hand, retail investors typically do not all move in one day. even the massive mutual fund meltdown, we typically see it happening over a month or two. julia: what about for those who
run these funds strictly go back to 2007 -- you can tell me if i'm wrong, but there is a greater degree of understanding of core belief in a quant adopt -- and andtion of some strategies they don't understand perhaps the drawdowns and the efforts of drawdowns that can be taken, but for someone who has incorporated math strategy, what difference does that make? it should be true. people who should know better are also surprised and sometimes unprepared for drawdowns. sometimes retail investors get a bad name. suddenly all those class -- all of those classes don't seem so great. one aspect of that is quant has gotten much broader.
in 2007, it was much better defined and today, i believe the andest etf is a growth etf the quant would call that a dumb beta etf. calledough they are all quant, they are in the hedge funds back in 2007. julie: i want to play what he had to say because he talks about that diversity and gets your reaction. >> going back to the data side and looking at companies through so many different leverages gives us a lot of comfort that there's a lot of ways to look at companies and their fortune, not just looking at their statement of cash flows. the spectrum of possibilities are very large, so if we think to what was additional signals
maybetors 10 years ago, you had 5, 10, 15 different signals and now there are hundreds out there and that gives us comfort that there's people moving in the for directions and the idea with crowding, that fire alarm you're talking about, we are very sensitive to it. julie: he essentially echoes what you said but correlations are very high in the markets right now. we are seeing low correlations in the market right now. has this given a level of safety to the market in some way? guest: institutional funds, absolutely. does crisis, there is really only four or five top factors. the proprietary ones were flat mostwn a little, but retail funds have a very narrow
set of quant factors. but there's another aspect. it doesn't matter how may lenders you look at, some will go up tomorrow and some will go down. money, youd makes will have to have more stocks that go up dan go down even if your stocks have totally different approaches. these strategies dramatically underperformed for a few days and it shouldn't bother folks, but for those looking to get out of where it happens, the initiatives get out now. were a riskaid you and had to operate in that kind of environment. aboutwere warnings potential conflicts going forward i wonder what you see as
the greatest risk out there? successfulink he's at guessing what is going to happen. had to pick one major thing, i would a it would be a dramatic realignment in government, and i'm not just talking about the united states. right now i look at things kind of gridlocked in the world. no movement forward and that's actually really good from our sense. dramaticget a realignment that changes tax policy that does everything for a loop. go on the wayngs they are, think we are in good shape. chat to you.to julie: the former head of
financial markets research, you writing ats bloomberg profits. let's check the headlines on the bloomberg first word news with mark crumpton. mark: a spanish initial official says two of the four surviving barcelona suspects have identified an imam killed in an explosion as the mastermind of the extremist cell, though only one of the four suspects admitted to being part of the 12 member group. he reportedly said he was preparing to attack barcelona monuments with explosives and the imam intended to blow himself up when they did. firefighters in italy have pulled three children alive from the rubble after a 4.0 magnitude earthquake toppled homes and other buildings. the quake killed at least two people and injured at least 40 others and left 2600 homeless. cheers erected as the firefighters rescued the children, including a seven month old baby.
treasury secretary, steve mnuchin and his wife will reimburse the government for transportation costs when she accompanies him on official business. that is after the controversy created when the scotland born actress responded condescendingly to a critic on instagram. she posted a selfie leaving a government aircraft. she called the critic adorably out of touch. re-tile -- retrial on sexual assault charges will be delayed until next year as his new legal team gets a two speed. a judge in pennsylvania granted the postponement of the case which had been scheduled to start in november, saying there's no way the lawyers would be ready by then. cosby is being retried on charges he assaulted andrea constand in 2004. he says the encounter was consensual. global news 24 hours a day
powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. julia: the latest model of the iphone is in the pipeline. apple is expect to use its inond but rest strategy just time for the 10th anniversary of the iphone. we will discuss. from new york, this is bloomberg. ♪
some real strength year and this his bit of a mixed bag, appointment in the likes of macy's and kohl's, but today, it's really helping the xrt have its best day in the month of august. if we happen to the bloomberg and look at this chart, is a longer-term chart of the flows on the sector spider etf and we the the outflows more recently on monday, the most since 2015. the fourth largest outflow of all time, so there is one big on retail.ry bearish we've been hearing about the move toward e-commerce, so one investor seems to be setting in that direction with the outflow there. very interesting to see that on retail for sure. the bar for the new iphone is set high.
the spotlight is on the features of the phone that coincides with the 10th anniversary of the iphone. mark berman has these details exclusively and joins us from san francisco. you say this would be a case that he in innovation, more perfecting features rivals already have. a.k.a., they stole everything already. continuing a pattern they've been using for most of their products over the past few decades. julie: we are talking about how tim cook says they don't want to be first everything, they just want to be best. we have a great graphic on the bloomberg and online looking at the different features. what is your favorite thing that exists out there on another device that apple is planning to improve upon?
aest: our graphics team did really incredible job. i think the screen is going to be the big part of this. a lot of phones from samsung to hsc to motorola and some of the smaller players have been using this technology for years but is doing it and they have reported they have a deal ath samsung to produce hundred million units. it shows colors much better. if you remember going from an older iphone to an iphone for, it's that sort of transition. that's going to be the big deal with apple moving to that. plus being able to look at the phone in order to unlock it. and it unlocks it in a few hundred milliseconds.
where did apple and iphone actually do something first? where's the actual innovation? apple let's be clear -- is the company that created the smartphone design. they were first to put it in people's pockets all the way back in 2007, but over the years, they were slow and allowing companies to come out with new ideas but apple affected those. some examples where they have been first, they were first on the faster chips, reducing reliance on companies like qualcomm and they have an advanced in terms of optics for cameras and the app store idea was popularized by apple. mobile payments, those were popularized by apple and the 3-d hundred milliseconds to unlock the phone, that speed
is unique to apple for the near term. make the pointo that is innovation in itself and i'm being coy in a way, but it is highly innovative in itself. talk to me about the reconfigured camera does this i am excited about. it really is the future. talk me through this because this is new. guest: earlier this year, apple announced a new program. tools to build a are apps. we had an example similar to the ar kit and i was able to play a game in the back of our studio and shoot rockets at these fake buildings and it was really cool.
another example was bmw has a nap and i was able to put a seven series bmw in our studio, actual size in terms of the ar graphics and go into it, check out the steering wheel and change the colors of the seats. i was able to put a 75 inch tv on the wall here. if you want to know what size tv you want to get, it measures the depth of the room and the space. the joys of being a tech reporter. remainshe question whether regular folks, not just the adjutant had like mark are going to buy this one. thank you for giving us a preview of the phone.
time now for the bloomberg business flash. a look at the biggest is the stories in the news right now. this is a gas distributor. power sector is seen a takeover surge. a representative declined comment. s&p has affirmed berkshire hathaway's will a score and remove the company from credit watch negative. it reflects uncertainty over how it was going to pay for the proposed $9 billion acquisition. that's your business flash update. julia: mark cuban is throwing his hat into the crib though currency race. he's doing it even when he thinks that coin is a bubble. this is bloomberg.
julia: julie: julie: this is bloomberg markets. i'm julie chatter -- i'm julia chatterley. and i'm julie hyman. julia: mark cuban apparently thinks there is opportunity in cryptocurrencies after all. he tweeted back in june that bitcoin was in a bubble but is now investing in a fund called one confirmation that will invest in block chain companies. he says in an email i have always looked at lock chain as a foundation platform from which great applications can be built. hopefully we can find a few. hyde.g us now is caroline we have to make a huge stink should here for top it's just one element built on what is a fundamental basis of lock chain, so he sees something here.
caroline: bitcoin is just one token out there and there are hundreds of tokens that have been issued, and most of them are based on block chain theory, a distributed ledger. getting mark cuban going and he's getting into this early-stage fund with a fund raising some $20 million. it's not his first foray. one of his companies is itself going to be issuing an initial coin offering. that's the initial sale of tokens like bitcoin, but a new one. also looking at other opportunities and projects, so clearly, he likes the underlying technology. julie: is there anything that approach?
it's not the only venture fund interested in block chain and cryptocurrencies. are exactly right. we have seen about a dozen hedge funds this summer trying to get into this hot digital currencies base. by the bitcoin, they tokens. the start up, almost $2 billion sales havecoin occurred in the last 12 months. a seed different is fund. they are going to the company before the ico and putting money up to $500,000 into the company we he quitted pro-quote is will get your token what it offers and we give that a discount. he hinted at a third
crypto investment going forward, potentially buying into the currency itself. do we have any clues on what might be next on his agenda? caroline: he's getting into a venture fund that sells the assets, but is a portfolio company that sells its own tokens. bitcoin he thought was in a bubble in june but it has scrutiny going already, particularly from the sec. julie: we have a quick headline on blue apron -- the company is losing its human resources chief and starting a hiring freeze. we will be with the reporter that broke the story. this is bloomberg. ♪ ♪
♪ we're live in bloomberg world headquarters in new york over the next hour. your other top stories we're covering. investors are setting their size on jackson hole. mario draghi preparing to take .enter stage meanwhile, president donald trump taking his agenda to arizona. . campaign style rally phoenix an open at military strategy in afghanistan. a shakeup in blue apron. it is losing its blue -- human resources chief. check on the markets with taylor riggs. every time i talk to you, you're at the highs of the
sessions. the dow up 1% here and the leadq up more than 1.3% but big gainers in the tech industry like google, amazon, microsoft, all of those. 1%.re up almost i want to look at the big gains. .7% loss but it is only tuesday but we are up with 1%. i mention a lot of the tech stocks. apple, quickly, down four days in a row. comeback for its first aid five. we have up 17% here.
the first time it has been up since 2015 for nonathletic women's footwear. mace is continuing to work on his turnaround plan 4.6% hiring someone from ebay to help renew operations into online. ahead, close tomorrow morning. second quarter looking at $2.18 billion, the biggest overhang here in this expansion. let's look at operating margins. lowe's also looking for positive remarks. we heard positive news from home depot. theaps lows can also meet same-store sales consensus of about 4.4%. that is what we are looking at after the bell. julia: thank you.
getting underway this week. janet yellen will deliver this on friday. cohead of global asset allocation, great to have you on the show. saying -- dole are you believe will get any further policy clarification or do you expect this to be a nonevent? >> we think mostly a nonevent. one thing we wrote about was within theg debate fed about why inflation continues to surprise on the downside. there are a lot of codewords in failure -- you saw think mostnces and i
of what takes place in jackson will be about trying to set a plan b for a to fit through what the implications of future policy might look like if secular forces holding inflation down continue. like you think forces will remain in place unlike a lot of commentators who said -- you are saying the fed might be ahead and not behind when it comes to inflation. what convinces you they are not just transitory? >> the phillips curve does not necessarily -- people are talking about the existence of a very flat phillips curve. it does not have to be a straight line. we do not excuse the fact that it may be kinked. narrow is actually a lot lower
than the fed forecast it to be. there are demographic issues current models do not address well. older members are of the workforce and the most highly paid, moving into retirement and moving into lower income is the approach retirement and they are being replaced by younger workers and that is one reason wages have been under pressure. there are demographics issues. him affecting individual countries labor costs. the workforce has got more global. academic literature around the -- it ision mechanisms kind of a coin flip at best.
there is not good evidence wage deflation results in rising inflation. >> i know this debate will impact how they calibrate going forward. i know you believe we are a few hikes away from a cycle peak. particularly given when you look across the investment universe, it is tough to find a fiscal reward here. juste thing is it is not our view. the future path of fetch for -- i think therees, are two big investment applications. the first being the fact that the initial event we think for is the worldve moving to the precipice. that is the benefit of holding stocks and bonds together.
the second thing would be to learn the lessons of japan. people have been calling for this to rise for 20 years and for 20 years, bonds have been one of the sharpest radios out there in return for risk. an imposition is having both stocks and bonds together and this delayed bond market on again, will not have to worry about that for some time. will gou think rates high from here even if it is not much? do you see opportunity for investors? >> there are still credit products that offer yield and a reason we're not tremendously about risk off affecting
credit markers is we observe how stretched down sheets have in, and if you can delay the rate rise one or two or three years and the future, the technical that includes high-yield and emerging-market debt, that bid will be around for a while. >> the demand is there. about want to high -- ask high-yield in particular. there is a little bit of growing concern. about potentially could heading toward rocking is at the least. are you concerned about getting more stretched as earnings he or as we see
falling demand in the united states? >> we have had something unusual, a full-blown default empe surrounding energy and companies, metal on the 2 -- as the fears have abated, if you look at the makeup of the market, you have high-quality companies falling and the companies not able to sustain the mining and commodity went companies that were not going to be profitable with oil prices approaching $25, the have all gone out of this mess. the cohort of companies has been more solid. if you look at multiples, they are in the higher quintile where they have been historically, but you have to expect some kind of unseat the technical bid for credit and we do not see that in the near term.
>> fleshing out a healthier market. thank you so much. now let's get a check on the headlines with mark crumpton. mark: thank you. forces will arrive in afghanistan within days or weeks. president trump isn't confirming how me more service members he plans to send. u.s. troops will fight to win the long war -- war in afghanistan. thetillerson is signaling recent security council resolution imposing sanctions on north korea appears to be having an effect. noted since that vote, there have been no new missile launches and no provocative actions. >> i'm pleased to see the regime has certainly demonstrated some level of restraint. and we have not seen it in the past.
addedretary tillerson perhaps we are a pathway to sometime in the near future, having some dialogue. russia and the vatican have a common view on many including the fight against terror. the cardinal added he was pleased with bilateral relations between the russia and the vatican. brexit, the u.k. wants to keep london the center of legal disputes. they published a paper that gave few details about how this might he accomplished. it currently covers about 40% of arbitration cases. eu countries could decide they want a larger share. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries.
us now. great to have you on the show. are you seeing more trouble ahead? how will this staff -- helping them address the current issues? >> they have a lot of that down pat because they have new jersey .ity workers around 1300 people the majority havarti said they will move over to the facility. time, the hiring freezes on salaried workers. >> the stock price has been and even today, the stock has bounced all over the place. have any idea for blue apron? is this step one >> i think the problem is they do not know just
how big the blue apron market is. it did not bring as much money and now it is a matter of strategic planning. how can they keep growing quickly? your fix cost, and you can hire some workers. on your point about not knowing this isthe market is, another consideration for investors, surely. .> that is right if you look at blue apron's life as a company, it has them overshadowed by amazon. amazon came in they have the capital, so much cash. they have a fulfillment center.
raid -- raise less than 3 million and they have that money come it will get them to the next level. can they do it is the question. question 28th, $10 and it is now just trading under five. let's turn to iron up about 15% in under 15 days. analyst atommodity barclays and we asked him what has been driving that rally. >> there are two does things going on. the first is macroeconomic context. we know the economy has come together nicely. metals will take the bid. other half, there have
been real supply-side challenges. the stuff well of have seen, we're looking at 22 million ton market and that is quite a lot of material. you have really supportive conditions. prices foraded your the whole year for the third quarter but you are still price.s on the i barely see any analyst cautious on copper anymore. >> everyone seems to buy the thesis that copper is going to 350 the percentage placed -- price. we are cautious because we look at the chart economy and we asked ourselves if what is having now is sustainable and we they think it is you will are lowering fixed asset investment, and they're trying consumerover into a driven economy, it is not the
same world saw earlier affected. we will see copper and other metals sale -- selloff. >> take a look at this bloomberg terminal. steel margins in china. they are really high. that is a bottom panel. keep buying iron or a outel if they want to turn the margins. what changes that picture for them? >> they have remained high and i think they will be high for some time. the key thing is that still can switch on a dime. you look at iron ore, around $90 per ton. we saw a massive selloff. we looking at inventories in china.
what -- once they reach a point where they have -- it pushes downward pressure on prices. this has been by construction real estate in china. is there a chance copper will be differently because the unique relationship with the lecture city demand for copy might shoot up? that is true but it is important to separate rhetoric from reality. we talk about numbers and we drill down into details, does not necessarily impact us on a quarterly basis. so far, investment has tell the little bit. as you go forward and look at the budget, that is flat year on year and we are not see much growth.
because today is a risk the market going up even on -- in relationship to the averages. investors have consistently put these to protect themselves. you see skew pick up as well. historically, it traded around the 118 level. all year long, we have seen it traded at elevated levels above 130. last week alone, it traded at 142 in the first days. that is extremely high. that index signals disaster insurance. are buying as much disaster insurance as possible and they're are anticipating taylor risk events to happen. in august is very seasonal it comes to that. it is pretty telling. paid off.s not >> it has not and that is going to the fact that because people
of hedged so much, they do not want to sell. they already put on insurance. why sell your stock when you can go out there and pay up insurance and by the disaster insurance even if it costs more? to the trade of the day. there has been, volatility within biotech in the market. you have seen some of it. classy is the elevated uncertainty when it comes to pricing and lot of drug catalysts as well and whether the of ea will approve certain trials pier 1ting is nice is than corporate the largest names. you have got your gillie at in there. do is sell the 320 call.
lowers your basis pretty significantly. you can make a total going out to october and capture a lot of to get youium through a volatile timeshift. -- implied liability is lower. you can buy the stock and continuously so calls in the united states. >> we shall see. julia? julia: coming up next, the relationship between trade and race. why president trump's friend sessions may be fueled i more than economics. this is bloomberg. ♪
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