Is falling, so does the s p. Caroline Second Quarter is beating on an adjusted earnings per share basis. Revenue, also a beat. The chipmaker is accelerating the product transition, they say. Revenue, 75lyear million dollars. We are managing to get some clarity from businesses in terms of forwardlooking guidance. Romaine hersheys was one of the big over today, up 6 . Even if the guidance does not necessarily meet expectations, the idea that they have some clarity definitely emboldens some folks. Of course, intel right now down about 4 . A lot of folks looking deeper into these numbers and apparently you are as well. Taylor key headline, that they will be accelerating the product transition. That is what they need to do to remain competitive against amd. I know that analysts, particular where looking to see how you maintain that competitiveness. A lot that could be within that 10 nanometer product transition. We also know that apple has been announcing their own chips, potentially hurting intel. How do you fold all of that into the narrative . For now, it does look like on that forward revenue guidance, being able to pull in a little bit above where analysts were looking. A strong half of the year. Analysts were really looking to see if that second half visibility cavein strong as well. Meantime, lets take a look at another chart that i am showing inside the terminal. We have been speaking with rbc. Look how far the market has run up relative to the average analyst expectations. Widenread continuing to as a lot of this rally, in her words, puzzling. Romaine we are waiting on a lot of earnings today. E trade, edwards lifesciences, skyworks crossing the wire right now. The apple supplier eps coming in above estimates. At 736. 8ue number oflion, versus an estimate 690. 5 million. Tor q revenue, 830 million 850. That is above estimates. We will keep an eye on intel as well. Seven nanometer processor now trending behind target. Maybe some clarity on why we are seeing that one fall at the moment. Lori, to take it back to who is still with us. And how much you expect forwardlooking guidance from businesses. We are managing to get it from the tech space, but it will be limited elsewhere. A great survey that they started in march when the pandemic hit. The last one they put out was in june. They asked cfos kind of what worries you the most. Coronavirusave of was what worries them the most. It has made me think that because we have seen the virus worsening since then, that we probably will not get quite as much guidance, quite as much clarity if reporting season happened a month ago. Their Worst Nightmare seems that it has come true. I think we will get some color. What we noticed at least and they reported from last week, uncertainty to traffic conditions. My guess is that you might have to wait now until the next reporting season or the one after that. I think it will take some more time to see how the virus evolves. Caroline it was great to get your perspective. Weaving us through all the highs and lows. Rbc Capital Markets equity strategy had. That does it for the closing bell. Whatd you miss . His next, where we will be taking a deeper look at those earnings. Pushing back timing by about 12 months. This is bloomberg. Caroline from a bloomberg World Headquarters in new york, i am caroline hyde. We saw a recovery on pause. U. S. Jobless claims rose last week for the First Time Since march. Coronavirus cases surge. Businesses shut their doors once again. We are lower across the board. Technology stocks feel the brunt of the selling. Stimulus negotiations. Treasury secretary Steven Mnuchin ditching the payroll tax cut. Wille clock runs out, lawmakers be able to get it passed in time. All that and so much more coming up. Romaine a lot of earnings crossing the wire including skyworks. A lot of eyes on the apple supply chain. Above estimates for quarterly results. It also gave fiscal q4 guidance. Revenue, the range has given above the average of analyst estimates. Now the gap coming in at estimated 152 above the estimate of 146. Intel now down by 7 . Pushback on the chip, being a key driver for intel. It was thinking about delaying the transition to that chip by the tune of 12 months. This is intel really saying it is far behind the industry in terms of Manufacturing Processes for its chips. These are the ones being delayed that had been used by apple and other chip designers for well over a year. Taylor delaying and running behind on the ship, then you are hearing from the company trying to hurry up that 10 nanometer chip process. Do you getby this sense that we are falling behind, particular when it comes to some of these chips . The seven nanometer delay, this is one of the key elements for me security that we have been following with intel. This is a disappointing roadmap delay. The numbers are good. We were actually pretty bullish on both through 2020. Those numbers have panned out because of the cloud strength. Both for me units perspective and asp perspective. But that is clearly overshadowed by the fact that it is seven nanometers product roadmap is delayed. That goes to the heart of the issue, which is, with intel, you have to deliver on the longterm roadmap. Otherwise, you lose that competitive advantage generation in and generation out. Execution disappointment for sure. Caroline interesting, the Data Center Revenues grew above 30 . It is interesting that the ceo sort of talking about an excellent quarter and does not really Pay Lip Service to this delay. Is he sounding a little bit out of touch . That is a good question. Intels argument is that no one cares about seven nanometers. People care about system performance. You can do things from a 10 nanometers chip coupled with memory to get enhanced system performance. There is merit to that. We have also argued that it is not a zerosum game in terms of Data Center Revenue growth, that you can have the nvidia and intel coexist and expand sales. Point, a great year on year revenue segment for the cloud, 47 . Overall, the platform was up 36 . So data center was up much stronger than what people at anticipated. Number two, pc is doing not too badly either. Pc volumes are up 2 . Desktops were up 3 . So, this is a good report. This is a better than expected report. That,he bears would argue look, i told you that these guys cant execute and here is evidence of further delay. Unfortunately, there is where it in that argument. Caroline right to have you with us. A quick note on some other breaking numbers. Sales, secondquarter net , 732 million, big beat for the Second Quarter in terms of a revenue number. We were just talking about tech. I have just been speaking with two key is this leaders in the technology space. Arianna huffington, cofounder of the News Organization that bears her name. We had a lengthy discussion about change and social justice, and a time forgiving. Take a listen. Than i have hopeful been. This has been a difficult time over the last 3. 5 years. I get myself convinced that wanted to be a part of what america wanted to be. Happens ist what that a lot of what i call the edge voices, we see them, hear about them, these edge voices of hate, discontent, exclusion, you name it, we hear them so much that we think, that is everybody, that must be america. Happenedhat what has in the last couple of months, six months or so, i am hearing more of the nonedge voices. Want a guys who say, i good life and i dont want a good life that smashes your life. I am starting to hear more hopeful signs about what i call a truly inclusive society. Embracectually capitalism, a great meritocracy, but that does not mean you have a whole swath of society, more are 50 i think that we starting to learn how to actually have a good conversation about that. We are starting to learn how to at least have a conversation about race. I chuckled a lot about how difficult this is. It is harder than having a cover station about sex. The sex conversation happens relatively easy. The race conversation, we dont know how to do it and dont feel comfortable talking about it. It becomes personal almost immediately. Nonbrownicans, or and black americans or nonbrown and black people around the world have to become more comfortable having a conversation about the fact that. Here is this thing called race work withddenly dozens of Multinational Companies and executives are fully engaged. Around ouries company, their responsibility. Not, as urszula said, about staying in their lane or shareholder reserves. It is not like we are having talks a lot about stakeholder capitalism and all that prepandemic. The fundamental shift now is that we have moved to action. Whether this action will be sustained and meaningful depends on all of us. Caroline lets get you a quick check on the latest headlines. They permit shift in buying vehicles online. That means 4000 employees that were dismissed in the middle of the pandemic may not go back. The Company Actually beat earnings in the Second Quarter. Warren Buffetts Berkshire hathaway is planning to put more money into bank of america. Banks largest shareholder. Bloomberg businessweek has learned that more than two years madejuul, a device that customers less prone to debt less prone to throwing the juul in the trash. Regulators were not aware of the changes. That is your business flash update. Now, turning to washington. Romaine we want to recap some earnings. Mattel, smaller company, still important. Hot wheels, fisherprice, reporting earnings here. That is what analysts were expecting on the revenue side. The company beat that. Net sales at 732 million in the quarter. Share, . 76. Per all around here, beating on all 5 iners, up about afterrs trading hours trading. Kevin cirilli has a discussion. Kevin in his new book, still standing, republican governor of maryland larry hogan writes that members of trumps cabinet urged him to consider challenging President Trump in the 2020 republican primary. The media was enamored by the idea of a popular republican governor going toe to toe with trump inside the gop. Cabinet secretarys encourage me to run against their boss, the president , that one surprised me. That was a stunning revelation. Which members of the cabinet . Gov. Hogan there were only a couple and i am not going to reveal the names because they are private conversations and i certain it would not want to see a couple of friends fired from the administration. I dont think it comes as any surprise to folks that there are a lot of people in the administration who have sometimes spoken out. Thing tost one small mention in the book. Certainly not a main focus of anything we were talking about. I did not have any kind of a serious effort to try to run for president. But a lot of people are encouraging me. I was surprised to hear how close some of these folks were in the white house. Kevin what was the primary motivation . That he would lose the election, theidence concerns, or direction he is taking the country . Gov. Hogan i think it was a little bit of a concern about losing the election and when the bottom is going to drop out of this thing and what was the alternative. And could we find someone who could perhaps put together a Winning Coalition in the fall . Kevin you did not vote for President Trump in 2016. Are you going to endorse President Trump this time or would you consider endorsing Vice President biden . Gov. Hogan that is a decision that i have until december to figure out. Right now, i am sharing the republican governors association. The National Governors association. We are trying to get things done in washington. So i believe that to later to figure out. Romaine lets talk about what is going on in washington, or rather what is not going on. Jobless claims numbers show the jobless claims ticking up for the first time in weeks after seeing a downtrend. Expiration of those supplemental on Employment Benefits expiring for a lot of people starting tomorrow as well as concerns about moratoriums on evictions and other measures designed to keep people at least partially whole here. What do you want to see come out of the legislation that mcconnell and other folks are working on that will help you help your residence . Gov. Hogan it is very important that we get something done and we get this fourth stimulus package. It is very frustrating i am frustrated with the divisiveness and dysfunction. It seems that we are back to these same kind of things again. We have a call with a lot of the governors yesterday, talking about things being stalled out. I cant predict what will happen. Toy a couple of short weeks get all of these things resolved. We have been pushing, and we had some commitment before from the white house. We are on the front lines trying to provide support. The more services, the more people that desperately need it. We had a request to the states. We have already laid off 1. 6 million state and local workers. Today, the news is that that is not in the Senate Republicans bill. Ill be talking to those leaders over the next few days with a couple of my colleagues to see if we can knock some common sense into them and find some bipartisan solutions. Caroline not only is there the economic turmoil but also the pandemic that continues. How much are you finding it to help or hinder the white house at the moment in terms of the uptick in covid19 and how much you can help your residence . Gov. Hogan i dont want to just focus on the negatives, but we are concerned about the fact that it is spiking up again around the country and we have heard talks from the white house and the president and the last few days about cutting testing cutting funding for testing, which is probably one of the most important things we can do right now to get a handle on where it is and to stop the spread. People waiting up to 10 days. It is critically important. We will have to continue to press the federal government. They have provided some assistance. We have got to keep working because this virus is by no means behind us and we need the federal governments help. We need our federal partners to step up and continue to help. Forline thank you so much spending some time with us. And kevin cirilli. Thank you very much indeed. Coming up, the future of private equity. Will to getting we will be getting an inside perspective of the industry landscape. This is bloomberg. Save hundreds on your wireless bill without even leaving your house. Just keep your phone and switch to xfinity mobile. You can get it by ordering a free sim card online. Once you activate, you only have to pay for the data you need, starting at just 15 a month. There are no term contracts, no activation fees, and no credit check on the first two lines. Get a 50 prepaid card when you switch. 5g is now included with all new data options. Switch and save hundreds. Xfinity mobile. But what if you could stdo better than that . K. Like adapt. Discover. Deliver. In new ways. To new customers. What if you could come back stronger . Faster. Better. At comcast business, we want to help you not just bounce back. But bounce forward. Thats why were helping you stay ahead and adapt with a network you can count on, 24 7 support and Flexible Solutions that work wherever you are. Call or go online today. Caroline the owner of ann taylor and lane bryant clothing chain is going groped. Is going bankrupt. Our next guest, anthony tutrone. 96 billion in alternatives. Bloomberg wall street correspondent sonali basak. Sonali thank you for joining us. Just this morning, we saw blackstone say that its private equity group was rising 13 . T months ago, people were is the industry in the clear . Anthony i would not say the industry is in the clear. Thei would say that of all firms, the private equity firms are the best positioned. The performance portfolio in june i think will be better than all expected back in march. Average, lown double digits in march versus the public orchids that were to march. Rom december for june, we think portfolios would be flat to up across the industry. That also will trail what the s p did, 20 . But that tends to be how private equity reacts. In this situation of stress, the private equity portfolios, given the longterm relationships they have, the recurring revenue they have, they are best positioned to whether these downturns, and they are best positioned to take advantage of opportunities that thisfrom crisis ease like crises like this. Romaine why do these portfolios hold up a little bit better . Anthony i think one of the reasons, the marks are more based on the longterm prospects of the business and not daytoday trading volatility. Dancep has kind of done a december, as much as 30, 40 , then back up to almost flat. In that same period, private equity took a smaller write down in the beginning but much smaller write up. The volatility has smoothed out a bit because of the longterm nature. The other reason, the private equity firms control the companies that they own. They are much quicker than Public Companies and other companies in cutting costs, preserving cash, making sure they have the liquidity that they need. Certainly, the better private equity firms have invested heavily in expertise and resources, and they are much better prepared for this downturn than in 2009, no doubt. Seen leveragelly levels creep up in the last decade. Are investors going to clampdown on that as we move forward . Or are those days over . Anthony it is a very good point. Clearly, there is 10,000 private Equity Companies out there and many of them are very highly leveraged. Pain as a be some result of the economic crisis we are going through and some of those companies. In the have seen financing markets currently, for companies that were mostly unaffected by what was happening, there is still pretty aggressive ability to borrow at levels similar to covid. I think, for other companies, there is reduced appetite for that kind of risk. Remember also that private equity firms always have a pool of capital, or typically have a pool of capital that if a company hits a hard spot and they think it is just a temporary issue caused from Something Like covid, they have the ability to infuse more equity into the company. That is something that other companies, a luxury that they dont have. Caroline it is interesting that point you make, the luxury that private Equity Companies have was almost to one side, where we have seen through the public statements that some of these Portfolio Companies accessed stimulus that was offered mainly to support companies from going bankrupt, the ppp, they tapped them, and that has been a headache from some of those companies where they do have this liquidity, this money they can put to work themselves. Do you think that when the election draws near, there will be more of a headache for these private equities . Anthony there will be more pr headaches. I do think it matters. I dont think the firm has done a really good job at highlighting some of the subtleties. The capital that they have is not theirs. It is investors, just like any other investment firm. They can only use the equity if they believe that the returns werent putting additional equity in. Those companies that are temporarily harmed by covid, they could inject equity into them and get them to the other side to earn even more on the capital they put in. As far as the use of these think theres, i probably are cases where you could argue that it is the best thing for society and the economy to have access. On the other hand, i personally believe that firms that do access those funds, if they need them and if it is truly beneficial to maintaining their employee base, they should give up the economics around that transaction since they have used federal funds. Muchi tony, thank you so for joining us. Romaine lets get over now to the legend, mark crumpton, standing by. Florida, 173 people died from the coronavirus in the past 24 hours. That is a record, and pushes the total death toll to over 3500. They are seeing on average five times the amount of daily deaths they were seeing months ago. Congresswoman alexandria ocasiocortezs outrage over the republican congressmans verbal assault. She and other democrats criticized the sexist culture that allow such incidents to happen. His language during this weeks confrontation on the capitol steps. Congresswoman casio cortez addressed her colleagues in the house. Iocortez this issue is not about one incident. It is cultural. It is about a culture of impunity, excepting violence and violent language against women. To only have i been spoken disrespectfully, particularly by members of the Republican Party and elected officials of the Republican Party, not just here, but the president of the United States last year told me to go home to another country. Yesterday, congressman the offered an apology for abrupt manner he used to make conversation with the congresswoman but he denied using a sexist slur. Congresswoman oh because ago oc ez said congers woman cortezresswoman ocasio said she heard the slur. The unity kingdom and the European Union are trying to reach a trade deal by the end of the year. Major sticking points remain, especially on questions of fair and open competition, and fishing. Global news 24 hours a day on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in over 120 countries. Im mark crumpton. This is bloomberg. Taylor gold continues to be on a tear, rising continuously in many consecutive sessions, now the highest going back to september of 2011. Typically, it is highly correlated with fed futures. A recent divergence, at the baseline, showing no change in the next year. A 3 looking now at premium relative to the futures contract one year from now. For more on this, i want to bring in peter, the chief executive officer, interest interested to hear where you think gold can move from here . How much higher does it have the potential to run . It appears to be relentlessly moving towards its old highs established in 2011. We think that the charts, the momentum, the volume coming into the market, and the macro backdrop suggested could move to over 2000 by the end of the year. Caroline quite amazing if that is the run for gold. Manager investment specially in Precious Metals. Silver was down a little bit today but hit highs we havent seen since all the way back in 2013. Will silver continue on the upsurge as well . With the large move in Precious Metals, silver being a much smaller market than gold, once it gains investors attention, it cant help but getting squeezed higher in a more noticeable fashion than gold. Being a smaller market, it usually moves more aggressively. Romaine when we talk about this rally that we see here in the Precious Metals, a lot of folks will point to what we are seeing in the yield space. Talking about a 10 year real yield right now. Slipping from positive just over the last four months. Of course, above 100 basis points positive just two years ago. How much of this rally is dependent on real yield stay low . Thate market is telling us real yields are needed to support the economy. We think that is going to be the case for the indefinite future. However, gold does equally well in times of inflation and deflation. If you do get that inflationary process, we dont think it will hurt gold. In fact, it may enhance it. Taylor how does inflationary pressures enhance gold . Peter gold has been known as a protector of purchasing power. When other commodities and inflation are coming back into the system, gold is usually used as a protection against fiat currency depreciation. Caroline what about some of the miners at the moment . It seems like they have a ways to run. They seem to not be keeping up with the tear that gold has been on. Are in greatners shape now, producing record earnings and margins. We think that will continue for some time. And there is still some room left to move. Romaine when you start to sort of plan out how you match up your investment with Precious Metals versus, say, other assets, whether they offer net yield or they dont, the question becomes, do you start to spread yourself out with gold, approaching that 2000 level . We are talking about records we have not seen before. Do you start to spread out and look to other areas . Peter we think this is still in the early stages. The credit markets are still requiring much more accommodation from central banks. So, in terms of the amount of printing and modern monetary ,heory that needs to be applied we still think gold is the place to be and is probably underrepresented in most portfolios. Are already, we seeing that move into other commodities. Platinum, palladium, silver. It is starting to roll out a bit more to other assets. Taylor there is several charts we can look at when we take a look at gold and relative values to other commodities. Gold to silver ratio, copper to gold ratio. Which of these is showing you perhaps the best opportunity for gold . Peter i think it comes back to silver. Because the move has been so pronounced and relentless, and the market is huge. Once that momentum starts, with it moving into silver, silver could see 30 fairly quickly. On percentage terms, i still think that is the one that has the most promise. Caroline great to have you with us. Interesting what has been happening in terms of delta, some breaking news saying they will be capping the number of seats. Notably, they are asking customers to wear a mask through the end of 2020. This is something that we understand is likely, but seeing those dates in print does kind of continue to amaze. Romaine it gives you a sense that we are in for the long haul. We heard from another airline a little bit earlier, and that was southwest. It is planning to adjust its flight schedule to match the dip in demand. Coronavirus cases rising. The chairman and ceo saying they expect air travel to remain low until there is a vaccine or proper treatment. We had a normal year. We had a very good read on trends, bookings, matched capacity and demand very easily. It is not that volatile. Now we are in an environment where it is almost like we are starting our business from scratch. We had very strong bookings in place for the Third Quarter at the beginning of this month. In the last several weeks, with the spike in covid19 cases, we have seen the slowdown romantically and also an increase in cancellations. We had assumed that more people would be traveling, and therefore we added a lot of flights. We will need to more aggressively pull back on some gethose flights and try to the supply closer to the demand. How many of those pullbacks will be forever pullbacks . Will business meetings not be in person anymore or will you have to leave planes grounded forever . Great questions. I firmly believe that we will get through this, things will get back to normal. A lot of people say that things will never be the same again. Never is a really long time. I do agree with the concern in your question, which is, i think we have to be prepared that to get back to 2019 traffic levels may take a long time. Business travel in particular is almost nonexistent. The people traveling are more leisure oriented passengers. We are offering very low fares. We just have to be prepared for a lowfare environment for a long time and just do the best we can to react when demand comes back. Then we can put more capacity in place. We are very much in lets execute, lets monitor the results, then we will have to adjust. It is very tactical compared to what we are all normally used to. At one point to those tactics have to be involuntary layoffs . At the point where you just dont see a path to positive cash flow. Right now, we are pretty far away from that. We were on a good trend in june. I could see a path may by the end of the year, then i think you could relax a little bit with the concern about layoffs, pay cuts, benefit cuts, all of those really draconian steps. Right now, we dont have any intention of pursuing those at least until the end of the year. Romaine that was the ceo of southwest airlines, gary kelly. , judy shelton one step closer to joining the Federal Reserve board of governors. That is unless mitt romney and some of the other republicans stop it. Joe weisenthal will join us after the break. This is bloomberg. Romaine it is time for that part of the show where we check in with the man with limitless cognitive skills. Joe weisenthal. Another jobless claims day. Week, that increase last something that a lot of people were not expecting. Unfortunate but it seems inevitable because in the last couple of weeks, the pace of improvement of initial jobless claims has slowed down. We saw dramatic improvement after late march. The pace of improvement installed. This week, came in higher than expected. Kind of confirms that there is backsliding in the economy. Some questions about whether seasonal adjustments may be making the number worse than it is. But ultimately, it does not change the story much that lots of people are losing their jobs. Caroline and dependent on more federal stimulus. We know that President Trump is about to hold his daily press briefing. A lot of discussion about what is being achieved. Joe it seems almost certain now that there will be come at a minimum, a completed gap. For a lot of people, the last checks go out in two days. As of right now, there is scheduled to be a drop in income for households that are on floyd. I dont think it sounds like there is any sort of consensus about what the extension will ultimately look like. We will just have to see. But this is a major income hit that as of current law is scheduled for next week. Taylor in washington, mitt romney coming out and saying he will oppose Judy Sheltons confirmation to the fed board. What now is the likelihood that she could be confirmed or not . Joe denomination in the early days was seen as unlikely to pass, but we have not ultimately seen much opposition. Big question for a lot of people is what would be the influence or impact of someone with very unconventional standards on the fed. She would just be one vote, how much would it really matter. But one could imagine various ways in which her influence could grow, particularly in the biden administration. It is certainly something to watch. Caroline always great to get your take. That is all for whatd you miss . Taylor liver technology is next. President trump sent to speak in a few moments. Romaine this is bloomberg. Emily welcome to bloomberg technology. Im emily chang in san francisco. We are standing by for a new conference by President Trump, expected to talk about reopening schools. The president just tweeted. Easternstart at 5 15 and we will take you there live when we stepped to the podium. This after u. S