Transcripts For BLOOMBERG Bloomberg Daybreak Americas 20240714

Time now for the global exchange, where we bring you todays market moving news from around the world. Joining us in singapore is enda caringlynd hong kong, from hong kong, karen leigh from westminster, anna edwards. Trade talks with the u. S. Are expected to resume in early october. Enda curran has more. Da obviously a signal here that talks are going to go ahead. Weve been waiting for some kind of breakthrough, and now weve had a statement from the Commerce Ministry that there was a telephone call that included china vice premier liue h china vice permit or china vice premier liu he. Theres a little less committal on the chinese side, but there is still a healthy dose of skepticism required. A lot of economists say that these two sides have a long way to go before they reach any kind of meaningful deal. Duember, more tariffs are in october and december. We had some commentary from the global times today outlining that both sides are in a deadlock, and it is in both of their interests to come to some court of to some sort of compromise. Alix the other news that came out of china was the state council outlined potential stimulus, from boosting Infrastructure Spending to tax cuts to cutting the rrr. Walk us through what we might see and what it means. Enda it sounds like authorities in china are edging towards more support for their economy. That is kind of getting backed up by the key metrics. We nokia gauges on the Manufacturing Sector are under gaugese we know key on the Manufacturing Sector are under pressure. That theyre going to go down the route of more support for the Banking System by cutting the rrr rate at the bank of china. A lot depends on how these trade talks go over. If we reach a point where there is something of a truce, that takes pressure off china to support their economy. If it remains as we are now, ast will say theres probably good more stimulus to come out of china to keep their growth story ticking over. Kong, protesters are not backing down despite chief executive carrie lams move to formally withdraw the extradition bill. Lam since my and im spent, i noticed there are still some worries about this procedure. I want to reiterate that the sole purpose of the procedure is to withdraw the bill. Alix i want to reiterate that te sole bloombergs karen leigh joins us on the phone from hong kong. What are the protesters still upset about . That protesters are upset she didnt do this sooner. A lot of people saying if she had done it a couple of months ago, it could have staved off the recent violence we have seen. They are also upset she didnt immediately agreed to concede on other major demands that include an independent inquiry into what eretesters say w aggressive tactics by police, including over the past weekend. He want her to meet more of those before they sit down. A lot of people have said they wont stop until five demands are met. So far shes met one. A lot of people are saying this is too little, too late. Alix thank you very much. In the u. K. , Prime Minister Boris Johnson still vows to leave the eu october 31 despite losing two key votes in parliament. He takes aim at Opposition Leader Jeremy Corbyn. Pm johnson the first leader of the opposition in the democratic history of our country to refuse the invitation to election. Alix anna edwards coins us now from outside westminster. What happens now . Anna theres a few things to watch out for. Watch out for a speech by Boris Johnson this afternoon, u. K. Time. We might not have seen the calling of a general election, but it seems like he is in full campaigning mode, keeping up the attacks on Jeremy Corbyn. Also looking at splits in the cabinet, splits in his team. His brother has just quit from Boris Johnsons government. We are looking for any clues as to win the general election might come. Doris johnson has benign that request has been denied that request. He needs two thirds support Boris Johnson has been denied that request. He needs 2 3 of the support of the house. Were looking for clues there. Gina miller, who famously brought a case and won against the government around the triggering of article 50, shes in the High Court Today bringing a case that challenges the prorogation or suspension of parliament. Alix quit reporting. Thank you so much. Great reporting. Thank you so much. And the u. S. Consumers carrying the brunt of the weight for economic growth. Can it actually continue . Bloombergs alex harris joins us now. What do we see about how officials are viewing the strength of the consumer . The waythink it is other economists have viewed it, which is that the consumer is still continuing to carry the economy. The beige book was interesting because it did show some moderate concerns from tariffs and the impacts here, and it makes the manufacturing number we saw this week so important and something to be looking out for when we get payrolls tomorrow with the Manufacturing Sector. Alix especially after the ism reading and the detailed persistent weakness. That shentioned mentioned jobs tomorrow, but we also have jobless claims and durable goods. What is going to be the highlight . Adp, just toy that get a sense of where the unemployment number might change. Tablek that will set the for payrolls tomorrow, and dont forget, we also have Jerome Powell speaking tomorrow afternoon around 12 30 new york time in switzerland. Alix thank you very much. In the bahamas, Hurricane Dorian is being blamed for at least 20 deaths, and officials expect that number to rise. President trump promised help from the u. S. Pres. Trump we have numerous helicopters, and we are sending some people to give them a hand, and they need a big hand. What is going on over there is incredible. Alix the president was also ridiculed yesterday for suggesting over the weekend that the hurricane might strike alabama. Has showed reporters a map he altered in order to prove his point. The map came from the National Weather service and showed the initial track for Hurricane Dorian into florida, but the president added that black mark extending the path into alabama as things get curiouser and curiouser. Coming up, all you need to know for analysis on todays markets in first take. This is bloomberg. Alix time now for our bloomberg first take. We are looking at the anatomy of the rally from the last two days. Trade talks reportedly set to resume in october. Central banks are eyeing stimulus measures. Joining me now is vince bostick, andomaine serebriakov, ubs fx and macro strategist. I have to start with romaine because you have on a glittery purple tie. Tie. Ne its a rally its hard to explain some of these daytoday movements, whether it is people picking up on certain cues or words that signal some sort of shortterm gains. A lot of strategists are talking about hedging against the risk come up talking about being safe at the same time. You also have to look at what is being bought. This isnt broadbased buying in the equity markets. Sort of broade conviction and sustained rally in this market. Vincent but everybody is hoping that trade talks will resume and something will come of it. The reality is this is not just about trade. This is about the United States and washington not wanting china to have the upper hand as the mega economic global power. As long as the Navarro Administration wants to tamp we are still going to have major difficulties, but we are still seeing a push higher inequities because you get that trade headline, trade talks to resume, bam, we are higher. Vassili i would also push back on the idea that it is the Central Banks driving the risk on. If you look at what is happening to european inflation expectation, the ecb from us us a bazooka the ecb promised us a bazooka, but the market is not really reacting the way it used to react to some of those promises of qe. I think the markets seem to bounce up and down. They might be more hopeful about trades, but when you actually look at the impact of tariffs already announced, it is a significant downgrade to Global Economic growth. Alix you have china come of state council outlining nonaggressive stimulus to give them more ammunition. Factory orders were terrible, and the euro didnt even blink. How did they not feed into each other . Vassili i think the euro is at this point becoming a little bit like the new japanese yen. I think the easy be is having a hard time pushing rates lower in europe, which would have been negative for the euro. The fact the euro is holding up may have to do with other things. Theres certainly room for monetary stimulus in the u. S. Theres not a lot of room in europe or japan. I think when it comes to some other stories that are gaining traction, such as fiscal stimulus in germany, youve got to be careful what you wish for. This would be to offset significant further weakness in the economy and trying to get back to the baseline rather than really reflate an. Really reflate thing really reflating. Romaine if fiscal stimulus carries some of the risks that could have some longterm ramifications, what does the market have to hang its hat on now . We talked about how the consumer in the u. S. Cant continue to hold up in this to hold up this economy. Its hard to understand what flips that switch. If xi and trump come to some agreement, does that wash away all the troubles of the past year . Vincent i dont think so. They are really just too far apart. Whats driving the consumers credit. As long as the credit spigots stay open, we will probably see Consumer Spending spend up Consumer Spending stay up. Alix we can compare credit card bills at any time. [laughter] senior i still have a in college, so you dont come even close. Alix there is something we did learn, though. When you do have whatever this risk on rally is, you get a weaker dollar. That, in theory, should be a good thing. Vassili you do get a weaker dollar. I think the dollar has been playing the usual safe haven currency role that hasnt changed, but again, i dont think this is time to get out of the dollar. Apart from this positioning squeeze we should get every now and then, if you think about it, the dollar also has the best carry right now. Youre getting paid to be long a currency that is already defensive. Why would you not do that . Thats why weve been in this environment of strong dollar for longer. Vincent i totally agree because the alternatives are not good. Present ame just third option here. The narrative yesterday was you have reduced Political Tension in hong kong, italy has the potential 66th government since world war ii, and the hard brexit off the table. Does that not affect sentiment . Vincent if you look at them, none of them are off the table. A hard brexit is still a potential reality. My understanding is what johnson has done is now we wait to see if labour will call a confidence vote. If we get a confidence vote, you have to have an election. Hes let 22 mps go, which means he doesnt have a majority, which means you have to have an election, essentially. Only one of the five demands of protesters have been met, so more protests will come. Then italian politics, i dont even want to go there. [laughter] romaine you get to this idea that nothing is really resolved. You can say this is progress come about at the end of the day, you are talking the three largest economies, the u. S. , china, and the eu as a whole are not necessarily healthy, whether they are going into recession or not. You throw in some of the political instability in other parts of the world, and it is hard as a Market Participant to really figure out where do you go for yield, for safety. Right now it seems like the dollar is one of the surest bets. Alix guys, think select. The silly sobriety of will beast vassili serebriakov will be sticking with me. You can check out the charts we use over the next two hours at gtv. Coming up, pop goes the bump stock. Goes the pop foriscussed the outlook tilray next with ceo brendan kennedy. This is bloomberg. Alix cannabis shares in. Annabis Company Tilray surged barclays go to conference and bloombergs ed hammond, who is standing by was tilray ceo brendan kennedy. Ed a lot of the biggest Consumer Companies here include big beverage. How do they view the Cannabis Space . Brendan i think theres a lot of interest. There arent a lot of Global Growth opportunities, so lots of fortune 500 brands are looking at the cannabis industry as an area for potential growth over the next decade. It . And how to get into that is always a hot question for them, just like it is with the farmbased proteins. Cautious,hey are very obviously. When we are in conversations with novartis or anheuserbusch the past theyve taken up to a year from that First Contact to getting to a point where we can find an agreement. Ed theres some reason for that caution because we have seen this sector eviscerated recently in terms of share price movement. We seen your own company, but also a lot of competitors, get downgraded. Is that a function of the market in this sector getting so overheated . Brendan i think it is going to be as big, but we are in such an early stage. If you think about medical cannabis, theres 20 penetration. Make that double over the next few years to 80 countries, and all of this volatility is around , uruguay and canada. 1 of the worlds countries. I think we will see four more countries over the next 18 months, but you will see this continual at admission of countries that legalize dont ultimately continual admission of countries that legalize adult use. Ed lets play that scenario out. We see huge growth in the industry. You and i suppose some of your peers, are you positioned to meet that demand . It is such a young industry. Is the production there to see that when it does come true . We started with 16,000 square feet of production. Today we have 1. 4 million square feet. So weve added capacity. We started to grow cannabis wedoors and portugal, so have 60 acres growing their. We will continually add capacity throughout the coming years. At the same time, we are buying supplies from farmers, so cannabis raw materials, with the intent of importing that into portugal so we can manufacture finished goods. Ed in the last quarter you exported about six tons, up year on year, but the price came down. Is there anything you can do to control the price, but is it set by the market . Brendan it is really product mix that affected our Price Program, selling both flour and oil to some of our competitors selling both flower and oil to some of our competitors. See the newwe products being allowed in canada, that would allow the average selling Price Program to increase. Ed in terms of the users, i get it is still a relatively new product in any country, certainly legally. There is a novelty factor there, so you get a lot of people trying it for the first time. You also have this big market of people moving into the legalized market. How sticky are the new users . Are these people just trying it once, or is there more repeat business . Business . Brendan in every country outside of north america, our products are sold in pharmacies. We have the pharmaceutical sales , so we have to educate the pharmacists and some Patient Advocacy groups so that they understand this product. It doesnt work for everyone, but the patients that it works purchasers attent pharmacies. Thank youn kennedy, so much for joining me. Alix, back to you in new york. Alix that is ed hammond joining us with brendan kennedy, the tilray ceo, from boston. Coming up, more on my interview with Alfredo Marti, Riverstone Holdings managing director. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. And our shirts from custom ink help bring us together. We just upload our logo, and if we have any questions, Customer Service is there to help. [male] custom ink has hundreds of products to help you look and feel like a team. Get started today at customink. Com. Alix this is bloomberg daybreak. Its a risk on rally for a second day, at your beaded to the fact that the u. S. And china will meet in october. Is that really enough to lead this rally higher and get another leg up . Zero pointed percent higher on the s p. Take a look 0. 8 higher on the s p. Take a look at the dax and autos. That is where you see the real optimism come through. Cable up 0. 8 . The story is that a hard brexit is off the table. Some skepticism in that as well. Eurodollar higher, despite the fact that german factory orders were terrible. You have the first spanish 50 year bond auction coming in a little light. Do we see pushback from all these weaker yields . And the curve against deepens in the u. S. Also watch that. Fed officials weighing in on the strength of the consumer and the fallout from trade uncertainty amid weaker growth. Throughout the last couple of days, we saw things like, if you wait for consumer weakness, it might be too late. Consumer spending is not really a leading indicator. Of ubs r break off the silly sobriety off his vassili serebriakov of ubs is still with us. Vassili i would agree with the view that Consumer Spending is one of the more lagging indicators. We are starting to weakness in the ism surveys. To see be interesting what happens to manufacturing jobs on friday. It is the business sector that is starting to show it more. Temp jobs, seen hours worked roll a little bit. Does that mean for the fed . What does it mean for yields . Vassili our base case is for a 25 point cut in september. They do need to wait to cut further, so we think much of it is going to be backloaded to 2020. They will cut one more time this year, and then we see another four next year. Fed that is is a still going to be lagging the Market Expectations a little bit. Alix you have a call that the 10 year yield is now going to be 1 for the end of this year. Why . What was the reason for the downgrade . Vassili one is just that we expect iteris to have a Significant Impact on the u. S. Economy we expect the tariffs to have a Significant Impact on the u. S. Economy. Of course, you could argue that fed rates at 1 , we were at 0 untenured yields. Why go as low as we were going now . This is really about global forces. This is about the collapse in premia around the world. They are still quite a lot higher in the u. S. Than in europe and japan. Yields 80 basis points. I think it is just this global compression in yields. Alix which brings you to you dont want to bet against a stronger dollar this point either. Vassili but i think the story is a little different there. Naturally, you would say if the fed is cutting that much, wouldnt the dollar weaken . But why is the fed cutting . The fed is cutting for global reasons. Its Global Growth and trade tensions that affect risk sentiment. This is typically not environment when the dollar weakens. Fed cuts more, you still get a bit of a yield on the shortterm. Alix chinas vice premier liu sees economic downward pressure increasing. That is over and china. What does that do in terms of policy initiatives in china, in terms of dollaryou want in terms of dollaryuan . Vassili lets be clear, chinas economy is still going to slow to 5. 5 next year with the stimulus we are penciling in, which includes fiscal stimulus and rate cuts and so on. Some of the stimulus we are talking about right now is really offsetting a bad scenario. We are not in a position to get very excited about it because it is just taking the bad equilibrium out of the equation. When it comes to the currency, our sense is that they are trying to prevent it from depreciating more. If you look at what is happening, the currency would have been weaker otherwise. For this year and 7. 30 for next year is our base case. But i thinkbility, we get mobility. Alix your favorite trade right now . We like being, sure to the Canadian Dollar against the u. S. Dollar. I think oil prices fit into that as well. They are holding up really well. Beingise, we really like long treasuries at the long end. We expect yields to go lower. Alix good to see you. Now we want to get an update on what is making headlines outside the business world. Ritika gupta is here with first word news. China will u. S. And try again to end their years long trade war. The two sides will meet in washington in october. There is skepticism that they will be any breakthrough. Both sides imposed new tariffs sunday, and the u. S. Has another round set for october 3. Reddish Prime Minister Boris Johnson cant get what he wants on brexit from parliament, so today he appeals to voters. Johnson will like a speech after lawmakers moved to stop him from taking the u. K. Out of the eu without a deal next month. They also rejected his appeal for a snap general election. Hurricane dorian is churning its way up the u. S. East coast. It is now approaching georgia and the carolinas. One forecast calls for it to come ashore near wilmington, north carolina. It has strengthened to a category three hurricane. Meanwhile, the bahamas says the death toll from the hurricane is now 20, and it is expected to rise. Large areas of homes are still underwater. Global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im ritika gupta. This is bloomberg. Alix thanks so much. All week long, we are diving into latin america, a region awash in commodities and long described as a possible Global Growth engine come about that dream is consistently knocked down by geoPolitical Tension. Today we shine a spotlight on mexico, where the president wants to rescue one oil company that delivers money to the state. , spoke to Alfredo Marti Riverstone Holdings managing director. He sees opportunities. Alfredo we think mexico is extremely investable. The first thing there, if you go back the last 70 years, to max the last 70 years, this has been the only player in mexico. Had so much to do in that particular sandbox that they havent explored other types of geology but the ones more prevalent in the u. S. That we see asry very much investable right next door. We can bring our capital or people. Alix how much money have you put to work in mexico . Alfredo right now we are probably about 500 million in. We have seven Portfolio Companies active in mexico today , not just in oil and gas. We are anything from wind, solar , bringing the gas from the Permian Basin into the country. If you add all of that, that is about 500 million. We are in the first or second inning here. We have a partnership with mexican local Pension Funds just in terms of investing mexican capital alongside with our global funds. We do expect to reinvest in several billion dollars of equity index ago in the next few years. Alix your advantage is that you get to be a first mover and get the better price. Walk me through that capital structure strategy. Alfredo we are more focused on growth capital, Building Companies rather than being opportunistic investors. You want to have the right capital structure, for example, partnership with local Pension Funds. In argentina, we did it with another company when we founded vista. Isn everybody else distracted with other things, thats when we take our positions not in terms of buyouts, but getting our hands on the right resources that we can spend five or 10 years developing. Alix what is the relationship you might have with the government . Alfredo we are very prepared for things like that to happen. I cant tell you exactly what regulation is going to change when, but when we make new investment anywhere in latin america, we know there will be change. We try to have various alignments with the ultimate stakeholders. This is not so much about being a friend of politicians or things like that. This is making sure that what we are doing, the things that we are building ultimately have the support of the local communities, like in the case of investing ise are from the Mexico Teachers Union and pensioners in general. Our success is their success. We find that if you are patient, dedicated enough, and you have those right incentives, you can walk right through those changes in the longterm. Change . Es that when you have a lot of political turmoil, it may prevent a Larger Company from investing more capital in the region. How do you think about that in terms of exit strategy . That we our thesis is see all this evidence of the power of private capital, with the mexicanh framework, you will see another round of partnerships between the mexican state and private companies. We hope to be right in the front of that. Alix what do you hope the Latin American Oil world will look like in five or 10 years . Alfredo i think you are going to see a lot more independence. It is not going to be where the u. S. Is today, but you will see more Companies Like two other in mexico, midsize companies, playing a very significant role. One of the Large Industrial groups in mixed is developing an approach for next year in mexico is developing an approach for next year. You will see them be an active and important part of the landscape there, which is new. Five years ago, you only heard tenex. Temex. About with that was my interview Alfredo Marti, Riverstone Holdings managing director. Later on commodities edge, more on my conversation. Dont forget to tune into my boom, oils next big tomorrow night at 9 00 p. M. Sweeping, we look at stack revamps across the Banking Industry in todays wall street eight. This is wall street beat. This is bloomberg. Ritika this is bloomberg daybreak. Coming up in the next hour, inn cofounder equities in equityzen cofounder. Results, thed companys main rivals including out of a and facebook. Samsungs redesigned galaxy fold phone will go on sale in south korea tomorrow after a delay caused by the discovery of a severe defect in the screen. It is an Android Device that opens like a book. It costs almost 2000. Im riddick a group to. That is your im riddick a kubot im ritika gupta. Thats your Bloomberg Business flash. Alix today it is all about reshuffling and departures. A cfo to steer the bank through some tough times. You get a sweeping ubs promoting two heads to lead its steelmaking unit. Reports that a handful of partners may be looking to leave the firm by the end of the year. Joining me is bloombergs sonali basak and vincent cignarella. This has the overarching theme of banks changing it up. Why . What is the theory behind it . Sonali theres Different Things happening at every bank. Danske bank is reeling from the biggest Money Laundering crisis in europe. Other places, theres just tional changes going on. Don scott has a new ceo ceo. E has a new they needed changes to get past this crisis. The person taking over a cfo, commerzbank is not happy to see him go. Hes helped to them through a major restructuring. Also has to deal with structural changes in germany since theyve shifted to a retail bank. Danske bank, it could be very good for them in terms of stability. Theyve hired from number of other banks around the region. Vincent usually with banking, that doesnt work out very well. Though, talking about changing its investment bank. That is a different scenario than danske bank. Sonali totally. Some of the people that will be rising, and by the way, in about an hour or so, they will have a town hall with their employees. Some of the new leaders are some of the old leaders. Ross stephenson is one of my favorite people moving up. She joined barclays. She used to run the business, but moved to become executive chairman, and she is now going to be coming back to run the investment bank, alongside another who were both hired under the same era. We will see if some consistency will help. Vincent when you are combining trading units, that usually means Something Else down the road. Alix if that happens, where does the trade go . Is it really less trading . Vincent you have less traders. Staysading volume the same. You just have more people doing the same thing. Tradinghave a trader one currency. Now you have a trader trading three. Sonali whatago, have been covering one bank, and now it is three. [laughter] Alix Partners are put into leaving goldman sachs. What a rethink of the what we think of this . , since hevid solomon took over, believes the Partner Class is bloated. This is supposed to be an elite class at goldman sachs. Many of them are traders and Investment Bankers, trying to make some room for the consumer bankers in the new hotspot at goldman sachs. Vincent the whole new business for goldman is to be more consumer driven, more banking driven, not Investment Banking driven. Alix so where these people go . Its tough because some of the Investment Bankers have gone to some big rivals. Ever core evercore has hired some rivals. The traders are a bigger question mark. It will be interesting to see where chavez goes. Some of the others, gary cohn, we dont know where they are landing yet. Where they end up is going to be an interesting thing taylor it will all interesting thing. Vincent it will also be interesting if they form up and create their own little boutique firm, which does happen from time to time. Alix and the boutique world is hot right now, so that wouldnt be super surprising. Sonali right now we have m a coming down from alltime highs. Alix thank you very much. Vincent cignarella will stick with me. We will have more on the market action, coming up next. Cbs, thestopped by late show with stephen colbert, grilled about the fact that he gets confused a lot. In the last few weeks, youve confused New Hampshire for jfk and him ok will us and mlk were assassinated in the late 1970s, and assured us, im going nuts. So are you going nuts . [laughter] mr. Biden the reason i came on the jimmy comeau show [laughter] [laughter] the jimmy kimmel show [laughter] alix he said, i would be delighted to sit down and compare my iq to yours. You cannot go to a 711 or a Dunkin Donuts unless you have a slight indian accent. Yikes. , tune intoheaded out Bloomberg Radio on sirius xm channel 119 or the Bloomberg Business app. This is bloomberg. Alix time now for your traders take. Joining me is bloombergs vince cignarella. What if we seen today . , weent two days in a row saw yesterday after the bank of canada was more neutral, cad game substantially, and today we are seeing a followup in cable. That the a lot of feel hard brexit, johnson was going to deliver this. It is looking much less likely, although i would not take it off the table. Alix the rhetoric is you unwind your shorts because we are not going to have a hard brexit, but we could have a hard brexit. Vincent it looks like labour is going to have to call a confidence vote. That would bring about an election because hes going to lose the confidence vote because he fired his mps. It could just fall on itself that the election happens. It depends whether it happens before or after october 31, and when the confidence vote is called. Im hearing it could be called as early as monday, which could set in motion the potential of a hard brexit still happening on october 31. Alix do traders look at cable as an investment kind of thing, or is this pure daytrading on headlines . Vincent i wouldnt say like an em currency, but cable has it. Ys had a spec aspect to cable i think is more of a spec trade. You get high vol opportunity. I could easily see this going up to 1. 25 before we pull back. Alix for more of vinces awesome analysis, check it out on the terminal. Really appreciate it. Coming up on the program, Marc Chandler, Bannockburn Global Forex managing partner will join me for the hour as we break down the anatomy of the rally. Is it Central Banks, politics, or trade . This is bloomberg. Alix welcome to bloomberg this thursday, september 5. Heres everything you need to know at this hour. The u. S. And china will resume face to face trade negotiations and next month. Both raise tariffs on sunday, and the u. S. Plans to raise more next month. Boris johnson cant get what he wants on brexit from parliament, so today hes going to appeal to voters. Johnson will make a speech after lawmakers forced him to move on leaving the eu without a deal at the end of next month. He took a matte labour leader Jeremy Corbyn. Pm johnson he is the first der in the opposition first leader of the opposition in the democratic history of our country to refuse the invitation to an election. Alix Hurricane Dorian is approaching georgia and the carolinas. It could come ashore near washington, carolina. It has strengthened to a category three with winds 150 miles per hour. Apple is developing in Screen Fingerprint Technology that would allow users to scan their fingerprint on a large portion of the display and make my gross fingerprint even bigger. In the markets, you have the relief rally being attributed to trade headlines. Is it sustainable . S p futures up by 0. 8 . The dollar weaker for a second day. Selling all across the bond market. Yields in the u. S. Up by about 0. 4 . Going me now is Marc Chandler, Bannockburn Global Forex managing partner, joining me for the hour. What do you see . Johnson is defeated. He really underestimated his rivals in the eu and at home, so now hes stuck basically in a tough position. Sterling had this big relief rally, getting above last month high, a bit above 1. 23. Marc do you really think alix do you really think Jeremy Corbyn could be leader . Would that really happen . Marc i dont think so. Has ans like if the u. K. Election, what the u. K. Would call a hung parliament, what most of the world calls a coalition government, seems most likely. Alix we are looking at Vice President mike pence and u. K. Prime minister Boris Johnson, meeting this morning. Trade talks on deck for october. We will be watching the ecb next week when it meets on thursday. Futures move higher. Joining us to discuss the rally is sarah hunt, alpine woods Portfolio Manager. You are going to have a relief rally off of an october meeting that may or may not have specifics, and you want to go buy equities . Sarah the market once an excuse to go up the market wants an excuse to go up. Think just the fact that they are talking again as opposed to not talking, the resolution to the degree there is resolution in hong kong probably helps to a degree in terms of other uncertainties people are worried about. Changes in italy helped a little bit. I think theres a general sense of relief, but i think everybody understands that trade, ultimately a huge trade war is going to be a bad thing. I think people are looking at that and going, we need to get something done. If it gets called off or if we put tariffs on on october 1, it goes back to fear. But we are switching back and forth between those things. Marc that seems to be the case for the most of august. It looks like today we might get above 2950. Weve been going back and forth with that sentiment. What do you think the next break is going to be, that sentiment continues to improve, or we realize this is part of the cycle and get to a calm after we just hiked tariffs . Sarah there are a lot of things it will depend on, and one of them is earnings. It would get enough of a slow to affect earnings in a significant way . I also think in the end, if we dont get something done and things continue to deteriorate, it is going to be harder for that enthusiasm to keep going. The fundamentals need something, but right now sentiment is more important. Alix i like that you brought up earnings. This is a great chart. The white line is the realized correlation. Correlations have been moving headlines, the macro but implied correlation is now falling, which might indicate maybe that the micro matters again. Sarah ultimately, as people buying assets, you would like to think that the underlying fundamentals are important, but we are also back to global easing. Fixed income becomes a problem. Where are you going to put your money, and where is the growth . Europe looks a little problematic at the moment. Ive been looking at some of the valuations and thinking, thats a lot. You need to be growing a lot over the next few years to justify that. Right now people are willing to pay for growth, and its trouble if you are a value stock. Interviewed someone today the talk about the 10 year yield going to 1 by the end of the year. What that affects how you assess the value for companies . If we know the 10 year is going to 1 , does that mean valuation for the s p should be higher . Sarah that correlation has been a tricky thing for me for a long time. Once Central Banks are in charge of where rates go, i dont see why they should have the historic correlations people want them to have. Beingow one of them is pushed down in an artificial way. Worried about are Interest Rates going too far down. I dont know that doesnt create it soon worry that isnt the kind of correlation we would look for, where the yield should before it goes higher. Alix on that point, i have a fun chart. A Central Banks have cut 34 times this year, next 12 months they are looking at 58 more cuts. That is what the market is implying. This chart shows a different central bank and how we rerate the fed, the ecb. Why isnt this the answer for why we are seeing the equity rally . Then you have china overnight talking about the things we might be doing to create stimulus. Vice premier liu he saying kind of the same thing. Sarah you had a shortterm rally, but people were like, that doesnt necessarily mean things are better. I think the combination of trade is Central Banks cutting also positive for equities, but at some point you have to say, cannot go on forever . My instinct is to think at some point, that doesnt get quite the reaction people are hoping for. Marc theres another issue i think people are talking about on fiscal support. Some people are talking about the possibility we get Capital Gains indexed to inflation. Do you think that would also be a positive for the stock market . Sarah i dont see how it hurts, but im not sure that is a huge boost. I think it helps to some degree, but i think this goes back to things that are floated in germany. They are looking into possibly changing things so they can borrow more money than they are supposed to be allowed to. I think the fiscal arguments is what Central Banks keep saying, go do something. Alix if you have fiscal Monetary Policy coordination, theres no way you get out of that. How do you possibly move that if you put fiscal stimulus into it . Marc i think that is part of the argument. If the government can spend more money, it would take some pressure off of Interest Rates, i think the theory goes. Alix but they can never then stop spending. Sarah like we cant stop buying bonds and doing all those things. Alix exactly. Both of you are sticking with me. Tune in later today for commodities edge, talking about argentina and ev. Ches really hot coming up, Prime Minister Boris Johnson getting defeated again and again and parliament. This is bloomberg. Alix the pound rallying as Prime Minister Boris Johnsons strategy falls apart after losing two key votes. Later today, a speech appealing directly to the public. Looking at where the cable rate is going, is the decrease in Political Risk also a reflation for the rally . Sarah i think it is a competition of some of those risks that seem dire at the moment seemed to be off the table. I think hong kong is one of them because people were worried that was going to get worse. In general, the market is, you are back to i cant invest in fixed income, so if i take all these worries away, does that mean earnings grow again . Will equities be the place . Marc it seems like theres bond yields, someone is buying them. I find remarkable if people are buying negative yielding bonds. They are not just buying them is a bold trade because they may fall further, but using the currency market, they can swap the currency out. They basically get a better return buying negative yielding japanese 20 year bonds. It really is promoting financial engineering. Sarah which is about trying to arbitrage away where there are issues between government currencies and their own debt loads. The question is cannot go on indefinitely . Were worriesre about japanese bonds, whether that was a widow trade, but at some point you have to feel like there is something more that needs to be done besides just being able to work on that. Alix i love how we want to talk about u. K. , but really, no one cares that much. They are watching things completely fall apart, but no clarity until you get clarity. There you go. Marc its only beginning to find some traction now that the government is in is in such a dire situation. Alix literally falling apart. Marc the Prime Ministers brother resigned from the government today. It is just a remarkable situation. It is much more like in turkey, where the president ousted the central banker and put in his brotherinlaw or something. Alix exactly right. Can you give us your thoughts on the negative side of lower and even negative rates . Weisenthal talks about that negative rates right be part of a new normal situation. Why should people get a return if they are not taking any risk . But today we are talking about trillions of dollars in negative yielding Corporate Bonds in europe. Alix in europe, arguably a lot worse than here in the u. S. Marc i think the negative yields, people are trying to collect coupons like pensioners. I think it is happening in the middle class for a long time, hard to reproduce themselves. To me, we have too much capital. Businesses seem to have a record amount of cash. Corporates have a record amount of cash. Operations are net givers of liquidity, adding to the surplus of savings. Sarah i think it is also really tough if you think about what it does to all of the capital risk pricing models if rates. Are. Negative it turns all of those equations if rates are negative. It turns all of those equations on their head. It doesnt make any sense to be paid to lend somebody money. There are all sorts of things that are becoming very problematic. When people thought it was a shortterm phenomenon, they thought you could live through this for a while, but now the banks go, this is really bad for us. Our Business Models dont work for us. Theres a lot thats upside down about that. Alix which leads up to the strength of the u. S. Economy. Adp employment for august kind of crushing it here, coming it at 195,000 jobs. Estimates, anded is up sick with chile, although till i was revised and is up sequentially, although july numbers were revised down. That leads me to tomorrow and the burden of proof we can see on jobs. See, the consumer is doing really well. Marc i think the Federal Reserve, almost no matter what happens, the Federal Reserve is going to cut rates later this month. Maybe this is in some ways because of the jobs data and the sense that everything is on the consumer. It is what williams argued, and i think this is part of the challenge. Fed may cut rates because the market expected it to, but is that really doing a whole lot of good . Does that on the margin make anybody change their behavior, except the market, which now expects it . How much does that do for the consumer . It is not like people are charging less interest on Credit Card Debt or anything like that. For most people, they cant the market. Alix we have seen temporary workers fall off a little bit. The amount of hours people are working falls off a little bit. Typically, Companies Start in those spaces before they lay off workers. Does that worry you . Sarah thats the question. Where is the u. S. Economy right now . There are still good parts and questionable parts of it. People are reusing factories and some other to factories, so there is Better Movement there than a few years ago. The other thing is to counteract things going long globally things going on globally. If you areould say at full employment, that makes sense, or restart rolling over at some point. Theyve kept this neutral rate for Interest Rates revise lower and lower. I suspect theres still room to come down. Also on employment, what does mean . Mployment how can we be at full employment when we are still creating 160,000, 170,000 jobs a month . The neutral rate for unemployment is probably lower as well. Alix we also heard that trend , and could do. 75 1. 5 . That would not make sense based on the consumer stronger job market. Sarah we havent talked about the job participation rates recently, which is still fairly low. That tells me theres a large pool out there not being counted. So underneath it, i think theres some other things in forwardatistics going that could change as more people want to work fulltime. Alix we have a question from a viewer i want to ask, talking about the strength of the u. S. Economy. Is there a case for keeping u. S. Rates higher as a driver for growth and stability . Marc i think thats the case the last decade, really. U. S. Economy is still doing much better than either japan or europe. I dont think this is the configuration the u. S. Government wants right now. I suspect it is not in line with the underlying policy missed. Underlying policy risk. Switching into a looser withary and tighter fiscal the tariff tax hikes. I think he policy is shifting away from the u. S. I think its a tricky thing. The dollar is strong because other currencies are weak. There isnt right now a powerhouse, except the u. S. , for Global Growth. It depends on where you sit. If im selling things to other stronger dollar is not so good for me. If im buying from other countries, the stronger dollar is good for me. I think it is tough because i think other countries are not in a place where their currencies can appreciate. It is not like the dollar is so it is that others are so weak. Alix sarah hunt of alpine woods is sticking with marc and i. Coming up, apple developing in screen fingerprints for their smartphones. This is bloomberg. Ritika this is bloomberg daybreak. Shares of slack plunging today. The maker of Office Communications software projected the slowest sales growth for the second half of the year for the First Time Since they went public in june. Their main rivals include microsoft, alphabet, and facebook. Prudential financial will pay almost 2. 4 billion for online insurer insurance iq. They are the nations largest life insurer by asset. Screens developing in Fingerprint Technology for its iphones. Bloomberg has learned the future could be available in next years phones. Apple added fingerprint scanning in 2013, but in the iphone home button. The new technology would allow you to scan fingerprints on a large portion of a display and would work with the current face id system. That is your Bloomberg Business flash. Alix thanks so much. For more on apple, we are joined by Marc Chandler of Bannockburn Global Forex and alpine woods Portfolio Manager sarah hunt. Sarah i dont think that is the change that will make people rush out and go get it. People thought the facial id would let people do that. I dont see that as a benefit to undergo phone. We are already trying to clean our screens off enough. Now you are just making a mess of the screen. That, to me, is not a huge innovation. I think some of the changes that come as with 5g will the Technology Changes that may come with 5g will really come as the Technology Changes. Besides that, in the scheme of things, i have to go out and get i vi have to go out and get the new when every couple of years has come down to a degree. Marc i think that is what is happening. People used to get the new cell phone every year or two, so a youer product cycle, do think that is a product of the comedy making marginal the Company Making marginal but not significant differences . Sarah when you start thinking about it, you think, i can wait a little longer. The combination of the fact that the technology isnt leapfrogging, and the fact they are making you pay for some of at tbecause verizon and were like, why should we keep buying you phones, that has changed the lifecycle. Why do got 200 billion, i need another 7 billion . Apple has a lot of cash. People want bonds because they are looking for anything with a yield. So they can raise the money. Im not sure why they think they need to unless they want to make larger acquisitions as a Product Company versus a services company. While services have gotten better, im not sure they are high enough to be that more than a Product Company. Alix hang tight. Some breaking news here for you. Said to be considering a 20 billion to 30 billion valuation in its ipo. Big headline crossing there. What does it mean when theres been disappointed with the names of uber and lyft, when in essence, this is just a real estate play . We will be going over it in the hour. This is bloomberg. At comcast, we didnt build the nations largest gigspeed network just to make businesses run faster. We built it to help them go beyond. Because beyond risk. Welcome to the neighborhood, guys. There is reward. Beyond work and life. Who else could he be . There is the moment. Beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected, to do the extraordinary. Take your business beyond. Our students achievements with custom gear. Drive they love custom inks different styles and designs. We love how custom ink makes the process simple with their easy to use design lab, expert artists ready to help, and unbeatable Customer Service. Custom ink allows our kids to show everyone their accomplishments and the pride they have in our school. When we place an order, i know they got our back, so we can focus on the kids. [narrator] custom ink has hundreds of products to make you look and feel like a team. Upload your logo, or start your design today, alix this is bloomberg daybreak. I am alix steel. 30 seconds away from the latest read on jobless claims and also productivity. We had a killer adp number keeping equities around highs of the session. It is still a relatively weaker dollar. Cable had a nice rally, euro had a nice rally. The curve still steeper, though modestly. Off the 4 level and crude going nowhere fast. Jobless claims are breaking. 217,000. A little bit higher than estimated but still in this range of adding jobs, solid job market. You are also seeing unit labor costs a little higher as productivity rises, coming in at 2. 3 . Labor costs rising in the second quarter, coming in at 2. 6 . Marc chandler and sarah hunt are still with me. Do we like this unit labor cost number, 2. 6 . Sarah if youre a consumer, yes. If you are worried about your margins, probably a little bit less. People have been looking for unit labor cost to go higher as signs of a healthy job market. I am not sure that is meaningfully different from the 2. 4 for people to get excited one way or the other. Marc i agree. We can onlyey is distribute to workers and incorporate i like to see stronger productivity numbers. This is a nice uptick. We need to see sustained gains in productivity to make a difference. How do we get there . Marc not easy. A combination of businesses investing more. We talk about lower Interest Rates and part of what this means is businesses have to lower their threshold to make investment decisions. The breakeven for investments has to come down as much as Interest Rates and yields. Alix if their threshold is 10, it has to go down to five because rates are becoming lower and more negative. Marc you have a ceo of a business proposal who says you 10 , the business down might say you only need 5 to make it realistic. Alix what do you think about that . Sarah that is an interesting discussion about expectations and reality. That is to say i will stick with a high level of irr i used to to do things even though the cost is higher. The thing for companies is are these conditions going to stay . Initially lower Interest Rates were going to be a temporary thing, now were looking at them as a more permanent thing. Everyone shift is it takes a long time for everyone to be this is a shortterm problem and if it is going to be lower i should be accepting less of a return. Alix it reminds me of yesterday, bloomberg spoke to the head of Norway Sovereign Wealth Fund and they said there if they are lucky they are looking at returns of 3 where returns in the u. S. Are looking at 7 . I do not know what it will take for them to be implemented. Is it negative rates . Marc maybe it is a question of time. People have to make this adjustment. They are reluctant to believe Interest Rates will stay low for longer. Now we talk about negative Interest Rates. Alan greenspan was saying yesterday that negative Interest Rates are coming to the United States sooner or later. Alix at some point you have to have more accommodation. Sarah hunt is dipping with Marc Chandler and i. Just moments ago we got news that wework is considering seeking 20 to 30 billion valuation for its ipo. Vasek joined bison ali and Phil Haslett Sonali basek and phil haslett. Good to see you guys. Valuation, billion due by . Phil they cut from do you buy it. From 47 billion. 10 billion is a wide range. I was joking in the office that what you have is a Crisis Management team masquerading as investor relations. They have had to deal with a lot of things. Is a wideu said it range, but where do you think it will wind up . Phil at 20 billion they would be trading at 10 times revenue, which would be far greater than their main competitor, which is about 1. 5 times revenue. I would guess they would price this thing in the 20 billion range given the company is trying to raise more money. The last couple of ipos they have price tie, we have dropped a bit. You think people will be more conservative to get rid of that problem . Phil bankers are probably begging one of these Tech Companies to come with probability and stable growth and something that can share as a better narrative rather than a turbulent macroenvironment with brexit. Alix funny you say that because data dog did that. It was a Cloud Company that crushed it, 80 sales growth, numbers anyone would die for. Then you have palatine, which say we will keep losing money good what we see more of . Phil i think you will still see more companies with narrowing losses. It might be better than hopefully we have hit the bottom this will be a peak loss year. I think you will start to see her turnaround. Ework is another softbank vision company, as is uber, as is slack. What does this mean for softbank return . Phil one is that softbank is in the market for a second fund and this will be a hard story to tell. The other part i would say to his thesis will take a long time. Never has somebody raised so much money to invest in such late stage companies. Softbank is what a venture firm does at early stages but for a late stage. Nobody has been able to build a portfolio of 40 10 billion companies, so i think that strategy will take some time. That is why hes think success in getting commitments for his second fund. Wework is a rocky ipo for arguments sake. What happens the rest of the year . Phil i think it will be tougher for the rest of the year. What he has the benefit of is there still cash to deploy. What he may do is go back to his existing portfolio and say maybe the environment is not ready for you to go public as a company losing 600 million. Here is another capital infusion. Lets try to get your story more toward profitability so that when public investors come in, we look more like what investors are looking for. Sonali the market is also rockier now. Phil right. When you have a rockier market you have a higher volatility and that is kryptonite for ipos. Alix is that only going to be for Tech Companies or is that spread to other sectors . Phil the same story spreads to other sectors when volatility increases, ipo tends to decrease. One, giveile that as another five or six weeks before you finalize pricing and you get into the market. A lot can happen in a macroenvironment. As stable as possible is what people want to see. The only companies you would see go out in that environment are companies that have the stable unit economics, profitability and a growth story. Sonali what are you most excited for . What is the biggest ipo you and your investors are most excited for . Phil we saw a lot of success with slack and spotify. We think airbnb can go that route as well. Wellknown business, growing consistently, and probably at a place where there would be excited to get into the market. That is one we are keeping ion. Alix what kind of valuation . Phil north of 20 billion. One of the last make ipo from that 20,008 to 2010 founding era. This might be one of the last of come out as a big success story. Sonali how many direct listings do you think there will be . Phil only a handful of companies i think can successfully pull it off. One of the reasons why is if you go through a director the sting a direct listing, the price market is not there. Some of the companies that do have direct listing will leverage platforms like ours to get an understanding of where the bids are in Different Companies before they do that and i think airbnb is the right candidate because people know the name slack and spotify. If you have Something Like an Enterprise Security company or a Cloud Storage business that is great on paper but not well understood by the retail investors. Alix what is going to be one you are watching that might not do so well . Phil most worried about . There are a couple of companies that i think it will be tougher because they may not have the growth story to slow to show. One is postmates. That is a food delivery app, a competitive space, but they have not taken as much money as some of their other competitors. I think they will benefit from being able to tell their story first, kind of like how lift kind of like how lyft got to say we are a ridehailing company. Alix could be an advantage for two weeks. Phil a lifetime and startups. Alix thanks very much. Appreciate it. See 20 we work could million to 30 million valuation. Would you want to buy we work . Sarah that is a tricky one. I think there is more about it being a Real Estate Company that is borrowing long and lending short. In the end, i am not sure that if you get a slowdown in the economy, that is someplace that will be able to thrive. I would be a little bit more wary looking at that to see where it comes out. The fact that you also have a lot of folks in their cashing out much earlier than this. Thatwary of that story but may not be the right thing to be. Marc there were questions raised about its accounting practices. Is this an issue . Some of these ipos are going ipo because founders want to cash out. Hash the founder of wework been cashing out more than people tend to do. I look at that and say their other companies renting out real estate, they want to make it a holistic thing, but you are renting out officebased on short windows and that works in an economy doing fairly well, but that is probably trickier if things slow down. It looks like we are getting a slowdown in the u. S. I am not sure that is going to be a place we will see right now. There has been a lot of growth already and i would be wary of that story. Alix great point. Sarah hunt, great pleasure. Love having you. Marc chandler will be sticking with me. Coming up, storing your big tickets to the game, the nfl season kicks off tonight. We will take a look at one company trying to disrupt the ticket industry. And remember, bloomberg users, check out this check out the chart at gtv. Ritika this is bloomberg daybreak peter coming up bloomberg daybreak. Johnson, later, kevin starbucks ceo. Now to your Bloomberg Business flash. President trump meets today with the General Motors Ceo Mary Barra just days after he blasted the company for cutting its u. S. Workforce. The ceo is hoping to discuss jobs, trade, and fuel economy standards. The president has criticized gm plans to close factories in michigan and ohio, states crucial to his reelection hopes. Ing will consider keeping cuts in its Trading Division if the market environment does not improve according to the chief executive officer. He spoke to bloomberg in frankfurt. We have decided in some countries to pull back. We have just guided on the equity site we have decided on the equity side already to pull back. This is a continuous process. Where you see there is opportunity in line with your clients, for example we are going fast on the commodity side. Ritika the nfl season gets underway tonight and begins as the league confronts a hard to believe economic truth. Just being a billionaire is not enough to afford a pro football team. The league is thinking of changing ownership rules to attract buyers outside the richest of the rich. The average nfl team is worth 2. 9 billion. Limits on debt mean an owner would have to come up with at least 600 million in cash, some a lot more. That is your Bloomberg Business flash. Alix thanks so much. So close to being able to invest. Now to follow the lead. A deep dive into the stories making headlines and moving markets. Our focus will be on sporting and ticketing events. Bloomberg spoke to jerry jones on the strength of the nfl and live sports. I have never been more bullish about the prospects of the nfl. Frankly, live sports. Our content is very valuable, continues to get more valuable. A lot of people say it is soft. That is not the case. It is the strongest thing on television. Joining us is russ dsouza, seatgeek cofounder. It allows fans to buy and sell tickets for sports, concerts, and theater events. You do it all, but we are focusing on football. What is demand like . Russ another great year for the nfl. Seeing so much interest in the big teams. What i love about seatgeeks we see the teams that are bumping up and demand. Browns, a team like the not synonymous with winning, but now they have an exciting offense and you see ticket prices rising 80 . Marc in basketball they are talking about small investors like yourself to have a small piece of a basketball team. Could that come to football . Russ hard to say. The investors the nfl is looking for people who will be investors for a long time. They want to stay away from private equity firms or things like that that might be looking to take these assets growing fast and think about an option flip, but we will see. Alix this is a big year for the nfl. What is competition like . We are seeing lots and lots of fans coming to seatgeek, not only to buy tickets for the first week but also to plan the future events throughout the season. Marc you think sports attendance is changing . When i was kid i was able to go with the family for a couple bucks, now i think about minimum take a family, even a family of four to a Football Game is expensive. What you think the average price of the ticket is now . Russ 244. It is quite expensive. What we are seeing is that fans are looking for things they can do with the people they love. What everyone loves to do was go to a live event and spend time with those folks. You are seeing over the past 10 years and increase demand in live entertainment. It is not just football. Major concerts and theater. It is a Strong Demand for being there a lot. Poor theres a was a report yesterday that private equity firms might be interested in stubhub. Say they did by stubhub. What does that mean for you . Russ it goes back to the incredible growth of the industry. We get excited when we see increased growth in demand. It starts with the fans, and that is obviously going to be an attractive asset for investors. We would not be able to talk about our specific plans, but we are always looking for opportunities to grow our business, and we have grown from a few folks and a copy shop 10 years ago to now company of over 400 employees with offices around the world. Marc with the Dallas Cowboys be an investment with you . Russ we are wellknown amongst americans as a company that deal onnd the best sports and theater tickets. Teams the cowboys used to power their entertainment system. It is almost like an operating system for a venue. We compete with Companies Like ticketmaster. Alix what is your longerterm plan with that . Russ we have hundreds of clients around the world. On the might know well Dallas Cowboys, new orleans pelicans, many soccer clubs. Internationally is a place where we have seen growth. You have the english premier league, one of the biggest leaks in the world, and we have market share that is higher than any other ticketing company in that space. We are looking at international as an exciting place for us to be able to grow. Asia . Marc what about marc what is great about ticketing is it is such a global experience. There are opportunities to do what we are doing and be successful not only in the u. S. , where we have been able to knock it out of the park, but look at developing countries like asia where that inherit demand to see things live as a human experience. Alix you brought up the experience. You also did surveys on where you get the best food, the cleanest bathroom, which i totally support, the best atmosphere. Russ i love that. Fansrveyed a thousand nfl to get not only what theyre looking to buy tickets for, but to compare stadiums. You see new stadiums like the Atlanta Falcons stadium, where you have the best food, the cleanest bathrooms, but there is nothing like the old School Experience of being at a place like Lambeau Field or arrowhead stadium, some of these older stadiums where you have these incredible atmosphere. Alix that is why i love going to coney island. Dsouza, seatgeek cofounder. Thank you very much. Marc chandler will be sticking with us. Increase if you are jumping in your car, tune into bloomberg heard across the u. S. On sirius xm channel 119 on the Bloomberg Business app. This is bloomberg. Alix time for what we are watching this morning. Youre looking at the baltic dry index. Tell me why youre looking at it. Marc i try to look in a broad range of things and see what is moving. This baltic dry index has jumped. A lot of people are puzzled, why is it jumping . Is this good news for china . Is this driving higher shipping price esses higher shipping prices . Other say there has been an increase in iron ore prices. I suspect Something Else is going on. That is about the supply of ships. 1, ships havery to reduce their emissions, and to do so, a lot of them will still want to use the cheap energy, but they will need to be retrofitted with these new scrubbers. It is taking thousands of ships out of stream, and in the short run, this marginal increase in demand meets reduced supply of ship capacity. That is what is giving a doubling or tripling of the baltic dry index. Alix i love that. I am taking a look at oil in particular because apparently it is possible iran will start violating the Nuclear Accord today. Oil prices had the biggest move in two months yesterday. New sanctions on iran from the u. S. How that plays out will be an interesting question for the market. Marc i think so. The interesting story with the iranians is the chinese seem to be solidifying a longterm agreement to develop their energy. Alix the u. S. Might not feel good about that. I love hanging out with you for the hour. Marc chandler of bannockburn. Coming up on the open, lale topcuoglu. This is bloomberg. From the 5am wakers, to the 6am sleepers. Everyone uses their phone differently and in different places. Thats why Xfinity Mobile created a Wireless Network that auto connects you to millions of secure wifi hot spots. And the best lte everywhere else. Xfinity mobile is a different kind of Wireless Network designed to save you money. Save up to 400 a year on your wireless bill. Plus get 250 back when you buy an eligible phone. Click, call or visit a store today. Jonathan from new york city for our audience worldwide. Im jonathan ferro. The countdown to the open starts right now. Jonathan coming up, equity markets rallying. The u. S. And china scheduling facetoface talks in october. With sentiment improving, Economic Data coming next. The jobs report around the corner as more signs of weakness emerge in europe, german factory earnings dropping. 30 minutes until the opening bell. Here is your price action. Bonds drop. Stocks up 1 on s p 500 futures. Bonds down, yields higher six basis points. The curve steeper. 1. 52 is the yield on the 10 year. Eurodollar up to 1. 1059. Lets begin with the big issue sentiment improves. Skepticism remains. Easing. Fresh optimism