The Unemployment Rate held steady at 5. 8 . Economic data here in the u. S. 8 30 we have retail sales. I will be watching that. Initial jobless claims, the weekly number on the jobless claims. Comfortnsumer index. Earnings before the bell, lululemon, scarlet, did they ever fix the pants . Bring me up to date. They did. And they made comments that were not flattering, so people kind of moved on. Do you wear lululemon . I have a couple of pairs. I have them in distress. Who are you wearing this morning . This is karen millen. I think she is british. I cannot keep up with you guys. And you your alpaca with your british designers. Bushe Herbert Walker turning 90 years old today, tom. That is really something. This is bush sr. , of course, one of the euros of midway. Iconic image of the submarine pulling up and literally pulling the young bush out of the water. Happy birthday, mr. President. Nba finals, game four tonight between miami heat and san antonio spurs. And as we are talking about the world cup, first game is today brazil, croatia, 4 00 in brazil. We will get a data check. A look at equities, bonds, currencies, commodities. Moving, eurodollar where they were, nymex crude, this of , brentn oil, 1. 06 crude, lets move onto the next screen, brent crude really moving in the last hour. We will hit a 1. 12. 1. 1186. There is brent crude, 1. 90 now. Pagesur the front this morning. Here is scarlet fu. We do not have to go far because an al qaeda offshoot is making more gains in iraq, raising the prospect of civil war in the country after they captured the city. Forces have moved into a city 80 miles northwest of baghdad, which is actually the birthplace of Saddam Hussein. Remember that image when they said we got him and they pulled Saddam Hussein out of that hole in the ground . That is the past. Here is a chart of the past from 2008. Here is the iraq invasion, we go to problems, down we go challenges, up we go again. You can see inching up here towards 1. 12. This is just a mess to break out above that. Technical analysis. Very good. There is our range trade. That is very good. Fancy. But there is oil from the advent of the iraq war. What is impressive here is the white house has yet to respond to requests last month from the iraq his to bomb militant training areas in iraq. The president is reluctant with what i would suggest if youre on the front praises of everything i would suggest that you are on the front pages of everything, it is about one, im guessing 2 00 p. M. In baghdad right now, and this is a story happening in realtime. And they are waiting for the white house to respond as all re we all. The cocoo is the first to step down as to whether the french bank violated u. S. Sanctions. He bangs that he is leaving of his own request. You will be retiring. Apparently he was supposed to retire soon anyway, but he has move that up. Wasyork Bank Regulator looking for his dismissal along with 12 other bm people employees. But the others are still there for now. The others are still there for now. But this is the first senior guy stepping down. They are still negotiating the record criminal guilty. The last count was about 10 billion. And that was one of the subjects of conversation between president hollande and obama. Is this a front page story or a frontpage section it is a story that will not go away because they cannot figure out a solution. And it is gumming up everything in the meantime as well. Lets stick with friends because our third front rate story is General Electric sending another lobbying push, 17 billion for Alstom Energy. And water its power unit, and also ges lead negotiator, john flattering. We already know that Germanys Siemens may potentially team up to make a joint offer for out some energy assets. This is another topic of conversations between the two president s, the french president and the u. S. President , but president s are talking about Companies Like bp and ge, but they are. Those are frontpage stories. Breaking news that just crossed the wire in the last five minutes dvr and Blackstone Blackstone continued to plow money into real estate here. Cash is free, right . There is our front page. Our guest host this hour, neil macro renaissance research. Were also thrilled to bring you anthony punter oh. O. He is kneedeep in the world cup. Feifa. He will give us a terrific perspective. With you. Me start women fed meeting june 18. I know scarlet wants to talk about jobs. What would you guess care yellen is focused on on this thursday morning . I think she is focused on wage growth. She is focused on how viable the Unemployment Rate is as a signal of labor market health. Is it a viable signal . I think so. And i think it is a very good question to ask whether it is reasonable to type Monetary Policy for lagging indicators of the economy like duration of unemployment, longterm joblessness, and it is also a question, look, we are generating a lot of jobs. Over the last 12 months, 70 of the time, the employment numbers coming above 200,000, yet Monetary Policy has gotten easier. Where is the playbook for that . Where is the playbook for leading indicators . What is the leading indicator she should look at . She should look at things like jobless claims. But it is really about the outlook. Right now the bond market in the u. S. Is basically telling us that there is no positive growth impulse from the headwinds we have seen over the last five years. There is nothing good that will come from the fact that state and local governments are no longer retrenching. Nothing good coming from the fact that households are no longer deleveraging. To havethe fed is going a communication challenge on its hands, particularly once the taper is over. There also seems to be a moving of the goal post. Chair evans saying six out of the eight of the last month, it has been above 200,000, but it may not be good enough. If you go back to Charlie Evans back in 2013, he specifically said a good labor market would be 200,000 for a few months in a row. Now that we have got it, of course, the labor market is weak. Consistency is not his strong suit. But here is the thing if were generating this kind of employment, at some point you will see wages rise. My guess is the on employment rate gets toward 6 . That is going to begin a discussion. It is not mean the fed is behind the curve, but it starts a discussion, and i think it will be absolutely appropriate to be talking about rate hikes in the Second Quarter of next year. We cannot ignore the stability. They have changed it in language, but they have not changed it in timing whatsoever. So the market thing, come hell or high water the fed is going to go in late 2015 i am not so sure that is going to be the case. The media as well what we will be keep an eye on. We want to welcome the former marketing writer for anheuserbusch. Anheuserbusch has been a sponsor of the world cup since 1986. You negotiated a deal with fee back in 2002. That was a long time ago. The way you message has changed a lot and that. Period. And really have. I left athens to go to zurich. At that time, it became a big deal. Million to 100 million for a sponsorship in of time. Od it is the Largest Sporting event. Sponsors, six other partners, sponsors. Your establishing yourself as a global entity. Who is the bigger venue for the world cup in the u. S. . Espn or univision . Univision will actually get bigger numbers, and they actually pay more money. Theyre broadcasting is better. If you listen to the playbyplay, it is actually fighting but adam johnson you might not understand it, but it is great. Goal that will wake you up. Ok. That was world cup coverage you just saw. Adam johnson with a world cup call. And i wouldve company news scarlet fu. Wife that was impressive. Impressive. As investigating how General Motors responded to the switch defect. Gm investigated 13 deaths which led to the recall of 7 million vehicles, and they have fired 15 people. Among the States Running their own investigations florida, connecticut, and illinois. Boeing may be the other big loser in the eric cantor election dispute. The House Majority leader has been a big supporter of the export import. Month, boeing said the import bank with the port 10 million in sales. The founder of lululemon voted against the rail action of the man who succeeded him as terrell and. Chip wilson says the yield aware companys board has been too concerned with shortterm results, which is why he voted against michael casey. Still, casey was reelected at lululemons annual meeting regardless. That is todays company news. All right, scar, he said forget lululemon, what are you buying now . Sweaty betty a supposedly didnt hot thing. All right, you heard it from scarlet fu. Now that cancer is out, some sweat. We will go to washington. Is out, someantor sweat. We will go to peter cook in washington. We will be right back. This is bloomberg surveillance. Good morning, everyone. Bloomberg surveillance. Coming up on the program, football,yna, nyc rather, nycfc, i should say. Joining us in the federal clocktower. This is bloomberg surveillance. I am tom keene. Congressman eric cantor said he will set down after losing a he will step down as House Majority leader after a stunning upset. Republicaneshape leaders about the party scribbles to replace it. We will target with peter cook, our chief washington correspondent, right now. Peter, what is the likelihood that infighting will take a toll and really put republicans in a bad position heading into 2016 . Leadershipthis scramble will be a real battle. It will be quick. It will happen over the next week or so. 219, a week from today, they will be picking a new House Majority leader. I could trigger if you will a domino effect down the line in terms of other positions that could open up. It represents the struggle that eric cantor faced. More conservative factions of the party, particularly those worried about immigration and perhaps more moderate aspects of the party. Watch for that battle to play out over the next week or so, and scarlet, this is an appetizer for an even bigger battle to come in november when they like people for the next term in congress. How do you buy a vote in congress in 2014 . How does one of these new leaders go get the congresswoman from nebraska to get them a vote . Well, two things. First of all, you have to make friends with these people to begin with. You have to have contributed money to their campaigns, which is what a lot of these guys have done, including Kevin Mccarthy, who is eric cantors pick to place them as House Majority leader. The other thing, tom, as you invite them to be part of your team. You asked them to serve as one of your tenants. One of the handpicked political positions as opposed to an elected positions. That is how you move up the leadership ranks. Peter, i want to share with musty morning read from alan murray writing in the wall street journal. The percentage of americans would here too liberal or conservative views has doubled since 1994 to 21 . Ideologicalin wings remain a marty, they are much more likely to work or vote on campaigns. They described eric cantor as effectively a guy in the center, and negotiator who can make things happen. Is there anybody left in the center who can make things is vocal in washington, peter . Peopleve got a lot of who can work on things like immigration . They see the results and say i cannot take this risk to be clear about my political future, at least not at this moment. Very hard to get anything done right now in its current environment. Nothing will get done between now and midterm elections except maybe a couple of spending bills. That is about it. Of that is the reality politics in washington right now. Peter, i read i think 15 48icles in the last hours, and things are moving so quickly. Simply, how is washington, how is the pentagon, and how is the white house responding . I think it is pretty clear that they did not see this coming, either. At least certainly not the speed with which the government would be losing control of major cities. That is the second biggest city areraq, tom, and there questions about what this administration is prepared to do, what can they do to help the government . There is talk about airstrikes over iraq. That is a big deal for this president who got troops out of iraq. I do not see that happening in the short term. Tricky situation for the president in a second term, who does not have a lot of political ammunition at his disposal. Is front and center with the turk hostages in the last 48 hours including three children. What is our relationship right now with turkey, and then that fractious relationship with Northern Iraq and kurdistan . Areell, the politics here so complicated, the relationships, the diplomacy. Turkey we have got a Good Relationship with turkey, but there have been challenges there as well, tom. Challenges for the turkish leadership. This is really complicated. This is a president who just know that his views on Foreign Policy going forward. The use of u. S. Force. He is looking to a lot of people in the region to solve this problem, not the United States. All right, peter cook, thank you so much. Peter cook is our chief washington or is wanted. And this conversation on the drama, whether it is eric cantor, whether it is iraq, it is not over yet. Because in our next hour of surveillance, our guest host will be robert wolf, former chairman of ubs americas. He was president obamas council. The word today is complexity. It is so complex. And speed. This is bloomberg surveillance. We will be right back. Good morning, everyone. It very busy day here in iraq. Lets get right to the top headlines with adam johnson. Most americans say the country is headed in the wrong direction. According to a new bloomberg 26 say poll, only the u. S. Is headed in the right direction. More than half of those surveyed say we are moving closer on their own goals for careers and financials. Im not sure what to make a back, but nonetheless the less, there you have it. Here in manhattan, a new report rentthe median monthly in may 2 3300. Wouldbe buyers are in the rental market. And hockey, new york rangers keep the stanley cup hopes alive. Is why scarlet fu is so tired this morning. She was up very late. They beat the Los Angeles Kings 21. Games. Gs lead 31 eyeso words soft because the puck did not cross the line. Morning mustread very quickly on an uber and london. Really straightforward. Mark champion writing for Bloomberg View this is a smart, smart essay with both sides represented. I think mark did a great job of signaling that taxicab drivers have to learn 25,000 streets. I think they call it the knowledge with a capital k. And young guys go around with maps, and their training to be cabdrivers. With uber, you have the gps. That is a great essay. I urge everyone to read it. Coming up, we are less than one week away from the next fed decision. What happens next . Host, neal dutta, writes about it. This is bloomberg surveillance. On Bloomberg Television, streaming on your tablet, your smartphone, and bloomberg. Com. Aj, and i will be right back with more. Good morning, everyone. Bloomberg surveillance. Our twitter question of the day, and we go to brazil of course what will be the big story during this years world cup . What will be the big story during this years world cup . That is out bsurveillance. Let me get to a data check. There is exactly one statistic that matters. Im not willing to say because of iraq, but you have got to believe that, oil advances west texas, 1. 0611. Right now on1199 brent crude. Youve got to watch oil also the afternoon on iraq. The next fomc meeting is wednesday, june 18. Economists are all over the map on a, who will win the world cup, and b, what matters to janet yellen . Neal dutta is head of economics at renaissance capital. We talked about this before. Lets start with the basics. When the chair says flack, what does that word mean . The level of at activity in the labor market. Basically the on implement rate relative to where the limit rate should be to generate inflation. Help me. The gloom crew has been quieted. A splash of Goldman Sachs earlier this week with a more optimistic view. Which is it . Of opinions. L where is the center tendency . I think just from all else, the consensus right now the earth quarter was a throwaway. For all. Reasons, technical economists may be downgrading be First Quarter even more. But if were generating over 200,000 jobs a month, what difference does it make . There is not a class in productivity. We know that from the earnings numbers. Is verydata noisy. I think were generating solid job growth as we have been, it is only a matter of time before wages began to pick up. Speaking about 200 thousand jobs a month number, that seems to be pivotal for nonfarm payroll. You have a talk that you brought in for us you have a chart that you brought in for us. More than 60 of the time in the last 12 months, why is this significant, and why is the fed not responding to this . It is significant because if you listen to the reactions on wall street after the jobs numbers, you see headlines like knows the price here, snoozer surprise here, snoozer. I think that is just ingenuous. Admittedly we are coming off of a deeper hole, but it is not right to say there has been no acceleration. There has been. Running at 250,000 this year, we were at 190 thousand or so last year, a little bit less than that the year before that. It is not very difficult to detect a pattern. And while all of this is happening, fed policy is actually getting more accommodative. Jim bullard brought up a really good point earlier when he said that the fed is closer to its goal than anytime time in the last five years. Jim bullard, the president of fed, a nuance voice. One of the ones like plosser and evidence that we have been following. We havevidence that been following. You wrote that u. S. Is not japan, there is a huge policy difference. What do you think the policies that have come out of washington have made the biggest difference . I think early in the financial crisis, on both sam put both feet on the accelerator in a way that japan never did, has ledinitial response to profound policy differences. Of course, u. S. Labor market adjustment was much more rapid than japan. That helped boost corporate profits, sort of restore confidence. So we have seen asset prices rise for one reason because corporate profits have picked up as well. It is hard to say where japan went, we are seeing lending pick up. So i think for a variety of reasons we are not japan, but most importantly it has to do with the speed of magnitude of the policy response in without eight. In 2008. Meeting inthe fomc june 18, number one july 30. Then there is the meeting, where i guess the chair janet yellen goes flyfishing . Something will come out of it, want it . I think so. We will get a better sense of where she stands on a lot of these questions about the labor market. Really it all comes out of the labor market. And whether we think the Unemployment Rate is built a viable is still a indicator. Lets go to tony ponturo here. What do you see in daytoday meetings . I have a guy like neil dutta looking at reams of data. Maybe i care what you think. I really want to know what you see in your client meetings. Is there a spirit out there . I think there is a spirit to do better, to move forward. Where is the attitude right now . It is one that is very good and very motivating. I think from a marketing standpoint, people are saying it is time to move forward, it is time to do better. But tony, are people getting more done with fewer people . Meeting as folks leave, theyre not replacing them. They are putting more work on the like of you. Text, peoplemore are cutting back. It have to be engineered into other kind of opportunities because big manufacturers are finding ways to restrict that. Is there anyone that has captured, anyone ad campaign, company that has captured the mood of the moment like hey, maybe we have turned . Evenys like cocacola, guys like budweiser are showing is time to have done in time to embrace and time to be part of the community. Geico ads,ose like it is insurance, let us just laugh a little bit. Within that, are we going to see that in nominal gdp, that animal spirit of the world . Seenthink we already have it, tom. In the second half of 2013, we had nominal gdp growth in excess of 5 . The First Quarter was pretty much a throwaway. If you look at the Employment Data that has come out, that is consistent with nominal gdp around 5 . We are already there. Whats ok, we are there, the fed is behind, the fed will catch up in some way. What does that due to the bond market, and then follow onto the stark market . Bonds, i think for were going to see a repricing. I would not be surprised to see the 10year above 3 before this time next year. Or equities, remember that the reason the fed is doing this is because they are comfortable with the state of the world. Neil dutta with renaissance capital. Jargon alert, adam, help me here, is repricing economics talk for we are getting hammered . Tapping me on the shoulder saying why are you losing so much money. You open it like this. Repricing. Lets reprice goober. All week long, we have seen profits from mary meeker. Today, we have one on chinas staggering growth curve. This is bloomberg surveillance. We are on Bloomberg Television, streaming on your tablet, your smartphone, and bloomberg. Com. We will be right back. Good morning, everyone. Bloomberg surveillance. It is arena corinthian in sao paulo. The rumor is the grass looks good. I saw photographs north up the amazon of the other stadium. 4 00 p. M. This afternoon. That is when they were going to play. There were photos and the showing decidedly unfinished, but they have good grass. In sochi, a lot of stuff was on potus but the games went on. I agree. But the grass is interesting. The england italy game will be an amazon and there is a real question there about the quality of the turf. I am not qualified to talk about it, but there is the stadium. We are here. Argentina. Argentina. That is your pick. Are you ready . Bloomberg surveillance, your world cup headquarters. Here is adam johnson with our top headlines. All right. The Obama Administration reluctant to get involved in military action in iraq. Last month, iraq asked the u. S. To carry out air raids on training areas. The u. S. Has not respond to iraqs request. You cannot says the fighting a something for iraq the pentagon says the fighting is a mate for iraqi forces. And in the wake of majority leader eric cantors stunning july 31. Will leave some members say the next leader should be more conservative. Stay tuned. Read while, a rare moment of agreement. He senate joined the house making it easier for veterans to get health care. Amen. The two chambers have to iron out some differences in their bills, but it is coming out of a report of mismanagement at Veterans Affairs hospitals. Those are the top headlines. At least washingtons get something done and done the right way. It is just shocking what happened to veterans. Yeah. Futures flat. What is your single best chart . All week long we have been featuring mary meeker s. Todays goes back to the early 19th century. United states and white in europe in blue have the Largest Global gdp, but china, the red line, it is on track to take its massive share of global gdp. It had a High Percentage back in 1820, so below in 1940, through the 1970s, really, and its not recovered to 16 , on par with europe. I am so glad you did this one. This is mary meeker both the most famous chart. She gives credit to angus ddison. This is the chart that she took from him, and i laud her forgiving professor maddison credit. Look at the fall of china, the rise of china, look at india, look at what happened to euro. And the motion of the redline line is the percent of the total world output that china is grabbing. It is a hockey stick. It is really a staggering growth curve and the reason why so Many Companies advertise china when they expand overseas. It goes to imf tensions over voting rights. I am scheduled to speak with Christine Lagarde on monday, and that will come up. It is a shameless plug, i will go with that, but thats how you put up for mary meeker will help. I want to get tony ponturos take. You were in charge of marketing for anheuserbusch. When you advertise for budweiser in china, it is a lot different than advertising to the heartland. Can you use boards is in china . Can you use the horses in china . We do not. It is not really relate to that in history. The chinese particularly realize if you are doing something that seems phony or fake or youre not bringing them the real deal, so you have to be really authentic and what youre doing, and they understand the heritage of budweiser. That is done quite frankly through sport and for years, anheuserbusch and budweiser sponsored big boxing events. They were aware of that. And the world cup. Of course, in china, there are so many other beers to compete with as well. Youve got the european beers that have their own heritage. And there are so many local beers. It is very difficult. Obviously it is a huge market and it will take time, but those kind of hockey sticks is why people invest in china. Yep. I have the deal of the century for you guys. You will appreciate it, tony. Lebron james doing very well off the basketball courts, and here is why. According to espn back in 2008, the miami heat superstar struck a deal to get a small stake. Small stake in beats electronics. All he had to do was agree to promote the headphones. When apples paid 3 billion for netted a profit of more than 30 million. How do you like that . Is that what it is . Just slap a celebrity on a product, get him or her to talk about it that is the whole marketing campaign. Here is the celebrity, get some peace of the action, and it just went like, you know what like what you see in identified brand like beets, do have confidence that apple can shape it or is a risk to try to appleize these headphones . Something i read is that beats now has a distribution arm in apple. They were building an infrastructure of distribution with their products. Now it will be in every apple store and it will be bringing some revenant relevance of contemporary music and arts and culture to apple with the beats folks. Not scientifically, by a mile, i see more beats headphones in the streets in new york. You see way more. I was given a pair of beads as a gift matt miller, right . Yeah. Really good. You like them . Yeah. Neil dutta, do you use beats headphones . No, i dont. I will be honest, i do have musical wit i watch my movies with my beats headphones on my laptop. I like bose. Bmw. There you go. We are a fragmented market. Well said. Lets move on because the world cup, tom, argentina, and resilience, the natives are furious at billions of dollars went into stadiums are not educated, not public transportation. Will protests disrupt the games . We will discuss coming up on surveillance. That brings us to the big story of the day, our twitter question, what will be the big story during this years world cup . That will be on everyones twitter feeds. We death bsurveillance tweet us bsurveillance. This is bloomberg surveillance. I am scarlet fu with tom keene and adam johnson. Lets get you some company news now from the files of bloomberg west. Amazon is running into a roadblock. Universal music has cut artists like kanye west and lady gaga. Universal considers the amazon offer too low. Withoutnveil this week universal music. Sony getting a boost from sports fans. The companys tv sales rose 30 in the First Quarter, the most in two years. The big reason why viewers wanting new sets to watch the Winter Olympics as well as the world cup. And pretty soon, you will get a charge out of walking into starbucks. The chain is teaming up with duracell to offer Wireless Phone chargers. Starbucks customers will bills with their phones down designated bots on their table. One hitch you will need a phone that can charge without cables. That is todays company news from the files of bloomberg west. Ive never heard of that. Wifi chargers . It is really cool. It uses magnets, like, through the air. It is wild stuff. Very cool. Some enterprising person is going to be going around picking up peoples cell phones. That is my pet peeve, when people walk down the street and they are this im just like yo, eyes up. It annoys me. Quite you were saying that all you are saying that all day long then. Argentina. You keep saying that. We have all that to get smarter. The world cup starting in brazil today. Anheuserbusch says it celebrates as one, as code of advertising, oneworld, one game. Brazilians are angry. They said billions went into stadiums, not into education. Tony ponturo, you signed the original deal with anheuserbusch several years ago as part of the sponsorship. How do sponsors like anheuserbusch and stay on point with her message and yet kind of acknowledge there is more going on here than just selling coke . Right. As he said, it is about being global, bringing the whole world together. It is about saying that you are sort of the cream of the crop, if you will, and i think what probably needs to start happening with the advertisers is to put Something Back into these communities. I mean, youre going to start hearing more and more about 11 billion paid by a country to bring the world cup, but what is happening to the people in the country. Ande between fifa anheuserbusch and cocacola and others, we need to find a way to put some of that money back into the community. You no longer work for anheuserbusch. You have your own consulting firm. If anheuserbusch comes to you and says help us figure out how to capture the moment and do something good for brazil, was illicitly as your invite t advi . Take 10 or 50 of what youre doing and marketing and put it back into the market, put it in playgrounds, athletic facilities, do something positive, and i bet you that will have more value than all the posters and advertising you can do. Tony, the most informative article i have seen is about the economist, the four nations not in the world cup or the u. S. , china, indonesia, and india. How does a major brand, lets pick on cocacola, how do they project this great events to india or indonesia . If you go anywhere in india right now i go to any Grocery Store or restaurant, you will see posters and pointofsale that says cocacola all over it with the fifa world cup symbol and everything else. It will be all part of that. And to those young people, seeing that is something to aspire to. And as the economists suggests, the next set this for the corporations to sponsor social development, infrastructure develop met with and some of these countries. Trying to bring money to high schools where students and families are actually having to pay out of their own pocket. Scarlet, why cant budweiser set up a popup bar two buildings from my house . Anything can happen. Anything can happen. About india, china, what about projecting to the u. S. Where some 60 of americans are uninterested in the world cup. What kind of Advertising Campaign can get americans excited . One of the things really effective, i think espn has done interesting things, showing people from all different parts of the Community Going to see the world cup. It is about telling people that this is something popular. Having said that, yeah, we are talking about the stanley cup and hockey. There are still only 3 million, to 4 Million People watching the stanley cup in the u. S. , so we tend to be there is so much choice that we have, there is so that youture is will only go so far. If the u. S. Is out, they will drop off, but the guidelines are there. To a pro like you, how much of this is almost cultural athletics . It drives me nuts in football, soccer, when they fall down and fake their herd. Too. At if they fall, kings gotty of the la a penalty for faking a fall. It is a penalty. They see that as a fake, they hate flapping as with the nba, and they just dont like it. Just play the game. Get up, you know, a lot in College Football where they get hit just as hard as anybody else and they just get up and go. Other parts of the world, they see it as part of the performance, i think. There is something inauthentic about in this country. Of course there is. What is your pick . Italy. Italy . That makes more sense then you going for argentina. As he said germany, i would be with you, but i dont know. Tony ponturo, thank you so much. It is not forex report, it is world cup base. A vanilla forex report. Eurodollar still 1. 35. 23. Zil off the bottom, 2. Coming up in the next hour of surveillance, robert wolf, former chairman of ubs americas joins us. This is bloomberg surveillance. He has not been accused of any wrongdoing. Nevertheless, the head of compliance at bnp paribas is shown the door. Oil purses higher. In brazil will play a soccer game at 4 00 p. M. This afternoon. Over 3 billion Television Viewers have been invited. Our number toom headquarters in new york. I am tom keene. Me, scarlet fu and adam johnson. We went to find someone who knows less about the world cup. Ceort wolf joins us, former and chairman of ubs america. Later this summer we will focus on the state of wall street. Right now we need to get briefed. Adam . We are going down under. The Unemployment Rate held steady at 5. 8 because their labor force visitation rate is falling just as ours is. Counting fewer people. Age 30 we have retail sales. That is a big one. Watch it. At 9 45 we have the consumer comfort index, followed at 10 00 by business inventories. Earnings come a we have a couple. Ulemon, items to note george Herbert Walker bush turning 90 today. Game 4 between the miami heat and the san antonio spurs. And the world cup, first game today, brazil versus croatia, 4 00. General electric plans another round of lobbying in france on its bid for Alstom Energy assets. Several top she executive several top ge executives are involved. New Music Service is running into a bit of a roadblock. It cannot reach a deal with the Worlds Largest record label. Universal music has artists like kanye west and lady gaga, and pete according to people familiar with the matter, amazon considers the offer to low. The Top Executive at bnp paribas stepping down amidst the u. S. Investigation. He is the most Senior Executive to depart so far, really the cochief operating currently the cochief operating officer. Retire, just looks like he is moving ahead. That is your company news this morning. I wonder where this story is 60 days from now. It seems to be slow motion. Hollande is saying you cannot penalize the np para bought to that extent. Bnp paribas to that extent. Cannot penalize bnp paribas to that extent. President obama says he will not get involved in a doj or new York State Attorney general issue. A bit of a mess right now. They are negotiating that 10 million fine right now. Kindest man eric cantor says he would step down as cantor says hec would step down as House Majority leader. The parties scrambling to replace him. Peter cook is our chief washington correspondent. Peter, who is likely to step into the void here . There are 3 candidates right now that have emerged as the most viable contender. Kevin mccarthy of california, number three in the house i s pick tocantor replace him as majority leader. Other names include Pete Sessions of texas and texas hensarling, bothn of them from the more conservative side. It is mccarthy who has the edge simply because he is part of the leadership right now. Which this is happening means he has more infrastructure and immediate ability to harness the votes he needs. The real contest will be in november after the elections. There is no guarantee that anyone in leadership now will be able to hold on to that post in november. This increased the odds of a budgetary battle . It does. Rankandfile republicans, they are all taking lessons from his defeat but the one lesson they are taking away is that if you push things in terms of Immigration Reform or vote for a debt ceiling increase, which eric cantor did, you might pay the price at the polls in the future. That is a stark message and one that is going to impact the budget debate going forward. May not happen in the shortterm but the message has been sent loud and clear for the longterm. Eric cantor was described by many as a moderate, a compromise her. Who of the different people that you just mentioned would be most like him . It would clearly be Kevin Mccarthy, someone, again, wes and part of leadership, has had thatt deals with democrats maybe he and eric cantor didnt like in the end. He would be seen as the more establishment candidate to fill that post. But the problem with Kevin Mccarthy said he comes from a democratic state, california. It is the red state republicans who want representation at the table and that is why havent look has a fight on his hands Kevin Mccarthy has a fight on his hands. Bakersfield, california, where mr. Mccarthy is from. Everybody including mr. Mccarthy also stunned by the speed of attack by militants in iraq. In 48 hours it has been a nation turned upside down. What is the single briefing message the president will get today on iraq . I think the message of the briefing is that this is happening really quickly and that the iraqiarmed forces that the u. S. Helped train were not up to the job and many of them left their posts and this is happening because the iraqi army isnt doing its job. The question for the president right now is what can the u. S. Do, what is he prepared to do to help the Iraqi Government . Is he considered during is he considering airstrikes, drone strikes to help mary a multi Nouri Almaliki . Peter cook, chief washington correspondent. You will keep us uptodate on the latest of elements in washington. Latest developments in washington. Rule 4b of washington politics is when the other side is in total disarray, zippeth the lip. Chairman andformer chief executive officer of ubs americas, an appointed member of president obamas council on jobs and competitiveness. Im flabbergasted by what we are seeing, as is everyone else. Capdoes Hillary Clinton and adapt to the disarray of republicans in house . My guess is a couple lines ago she felt better than most people in the political arena. You have to assume that the Republican Party has 2 different groups. You have the republicans and then you have the tea party. The democrats seem to be much more on the same script. It is going to be very difficult in a National Election for someone not to be on a proimmigration campaign. Talkheard Mark Halperin about the idea that the democrats have their own challenges as well. In your democrat party, is there a cantor equivalent you need to be afraid of . There is no question that you have the centerleft and then you have the left, a bit of a Progressive Movement going on. I think when it comes to national politics, the centerleft is where most of the country is on issues, whether it is gun control, immigration certainly the lack of having a debt ceiling debate. The markets i would say yesterday it was more of an impact of the world bank and the slowing economy than the cantor factor, no disrespect to the congressman. Nervousnesstainly that we want to visit discussions and that feeling that its all over again. Debt ceiling debates all over again. Bloomberg has a new poll out suggesting that president obamas Approval Rating is at a new low. Gallup would disagree and say it is rebounding. You have the president on speed out, literally, you two are very close, you play golf together. Cant god say that you by daily polls. We are an incredible volatile time, especially geopolitically. There are things happening around the world, whether nigeria oneday, syria another day, Southeast Asian islands. Him, like ifor would, kind of stay the course and fight for Immigration Reform define what that course is. What is the key course for him right now . The first thing is, obviously, making sure our economic rebound continues, widget feel which it feels like it is. More slowly than we would desire, but employment is looking better and wages are starting to come back. Quantitative easing is ending, a sign that the fed feels it is the right screen. On the geopolitical center, i am a supporter of not having boots on the ground and trying to do things with sanctions. I am not hawkish, it is not my mentality. I would try to continue tougher sanctions. We have a lot to talk about with robert wolf. Dow futures up 7. Redford was 112, now at 111. 65. Coming up, stadium or no stadium, airport terminal or no airport terminal, the world cup kicks off today. A team captain tells us why team usa needs to fail for american soccer to succeed. That is our twitter question of the day. This matters to our guest host, robert wolf, former chairman and ceo at ubs americas, a member of the President Council on jobs and competitiveness drones. Drones over fenway park, drones over pipelines in nebraska. He has measured a startup that will take on the faa on exactly who owns airspace. This is a topic everybodys talking about. Where are we going to be on drone 5 years from now . It is a Global Business and we are incredibly excited. It is a service run by justin as n and brandon for torres you got to have the ducks lined up, but where will we be in 5 years . Is the future of how commercial and industrial businesses work around the world, whether it is agriculture, pesticides, irrigation, flash fires, where we were in africa couple days ago and we were talking to state heads about wildlife poaching and environment. Disaster recovery. We are not looking at weaponize drones and we are not looking at civilian joystick type stuff. Were looking at things that can make a difference on efficiency in the business world. You are known as one of the great reads in democrat politics. How do you respond to viewers and listeners who say, wait, one of these things is going to get in the way of a laguardia flight path . We have to make sure it is regulated, with the faa is. They have approved only one drone for commercial use. We have to separate what we would call the joystick drones, which the truth is you can go and a poor start go in a toy store and buy. There have to be safety rules about how high they can fly and we have to be very particular. We are talking about a very different thing that will be used at farms around the world or places like the American Red Cross for disaster recovery. It is being used in Different Industries around the world already. The faa, they are not going to get into the rules until 2015. We hope that they, obviously, do a very practical and fastforward some of the permanent. Some of the permitting. How big is a drone . One of the drones were pitching for someone to use in africa is a 55pound going 4org, maybe 4 by something. There are all types of sizes. Robert wolf with us on the future come something really interesting, drones. Coming up in iraq, there is a surge in violence. Good morning, everyone. Bloomberg surveillance. Im tom keene. With me, scarlet fu and adam johnson. Batting coach with the boston red sox, worst job in baseball. Administration is reluctant to get involved militarily in iraq. Last month iraq asked the u. S. To carry out air raids on militant training camps. The u. S. Is still not responded to iraqs request. A military Spokesman Says that the fighting is something for iraqi forces to deal with. In manhattan, apartment rents have risen to a fiveyear high. The median monthly rent raised 3 in may to 3300, and that is for a onebedroom apartment, by the way. Higher prices and tougher mortgage standards are sending wouldbe buyers into the rental market. Here is one for scarlet fu. New york rangers keeping their stanley cup hopes alive, beating the Los Angeles Kings 21 yes tom keene fired up. Game 5 is tomorrow night in los angeles. That is why im wearing blue. The goal line was tilted nothing was tilted. It was flat, totally flat. You are seriously a hockey stud, you played in college, tom keene. When ice is warmer huge difference, huge difference. I was on a lousy team. We literally would keep the ice warmer to slow down better teams. That is like playing basketball at princeton. They put the shot clock at 24 seconds i played hockey in hong kong and soft ice was the only way i could play. They know it is going to bounce when it is warm. When i play tennis, i play with that balls not im embarrassed to say that even though i grew up in new england, i never learned to skate. My brothers used to take slapshot. I was the youngest kid and they would have me up with a baseball glove. Soccer right now. Tom, a soccer legend is among us. He led uba to three National Finals and became the First American to captain a European Team and lead team america in a 3 separate world cups. He joins us on set. Donna, portugal, and germany in the firstround a. K. A. , the group of death. What do these guys need to do to stay alive . The first game is the most important part of this. If they can get a result there, then they have a chance. That through when they win the first game. The stats tell at all. It will give us a chance not only momentumwise, but you have to push yourself and open yourself you you dont have to push yourself and open yourself up in the third game it was ghana in 2010 that knocked the u. S. Out. Opponents very difficult, the group of death, as you said. I have a good feeling. We are doing well, we have a strong team. They won three games before going to the world cup. Heat is going to play a factor. Humidity. I think that will even it out. Hopefully we can spring an upset here. I want to bring in my morning must read, which bridges everything between finance and sports. The chairman of these lists National Bank the swiss National Bank says that it is no longer as dull as banking. He says the team is however, the head coach has a new National Side and is brought together a collective that cannot exist were it not for immigration. Few teams are made up of solely nationals. How is the u. S. Team involved over the last couple world cups . It is interesting, there is certainly a globalization of the game and it has taken place in the u. S. As well. Players56 german representing us on the team, player who was born in norway. That is the way the soccer world is at the moment, and in switzerland they have a lot of immigrants who have moved there from various countries. That is the way it is now. Weigh in on the pin that claudio is wearing this one. You have the argentine blue on that. You control it because you are from argentina. But this is new york nine new york city ac . New york city fc. We Start Playing and 2015. Cellmate on how this is different from the lancet sell me on how this is different from the lancers 30 years ago. It is where the game is at right now. Soccer is really in a great place, the momentum it is. Thats the momentum it is gaining to grow on tv, the youth. It is a sport that is growing and has a lot of growth potential. All trending in the right direction. It is a great time to have a professional team in new york city, the greatest city in the world. With our partners, manchester city, the yankees, we can be something special. Those are formidable partners. The pastn says over several years in viewership and amortizing have gone up about 30 . What is the catalyst to get it up another 30 . That last big step in us winning. Americans like being depressed in the world at sports and we like being the best in the world at sports and we are at other sports also if we can one day be competitive and come close to winning a world cup, there would be the last big hurdle we need to jump. And we have some hurdles to jump. Thanks for joining us. You are a legend. Our twitter question of the day what do you think, scar . I dont know, there is always much talk about the facilities. Na in brazil, area corinthians. It is a television extravaganza with espn and univision. Exciting. First match, look for that this afternoon, i believe on espn across america. Good morning, everyone. This is bloomberg surveillance. Tom scarlet fu, along with keene and adam johnson. Investigators are looking into gm discovered that switch defect. The automaker has fired 15 people blamed on delays and recalling the vehicles and among the States Running the road probes, florida, connecticut, and illinois. Been a big has supporter of the Exportimport Bank and his defeat threatens the reauthorization that going council on national bo that b oeing caps on. The founder of lululemon opposes the election of the man who succeeded him. Tooays he has been concerned with shortterm results and that is why he voted against michael casey. That is todays company news. Wilson needs to figure out what to do next after making those comments to trish regan. I am actually on the president s export council, and our meeting is next week and i will be speaking about the reauthorization. Let me tell you, it is critically important for our country to have that bank working. Explain why. Because it helps our manufacturers sell goods and services overseas. We compete overseas with those banks all over the world and it is not belowmarket funding. They have had low default on their for been a profit center. Groundou find common with moderate republicans or do you just give it up to the house . I think you have to find Common Ground and our plan is for a longerterm expansion with more money, which will be incredibly difficult to get, but we at least need reauthorization. Robert wolf with us this hour. The rate of change in iraq is truly unprecedented. Joining us is Paul Sullivan from your Town University from georgeTown University, an expert on the cacophony in iraq. Missionthe president s this morning as these militants are 60, maybe 70 miles outside baghdad . You mean the president of the United States . President of the United States. What does president obama need to do to assist mr. Maliki in baghdad . This is a catch 88 situation, catch22 times 4. No matter what you do you are walking into a mess. There is discussion about possibly sending drones over and taking out these folks. There could be significant backlash towards the United States and its allies and troops overseas if this happens. The president has to consider that as well. This is far from a simple situation. It is very fluid. There could be help with intelligence and strategic thinking. I dont think the important people were just about the American People or just about anyone else in this situation wants to back themselves into this again. What are the ramifications if we do nothing . If we do nothing and nobody else does anything, that there is a possibility that these murderous people who were thrown out of al qaeda because they are too vicious could take over baghdad, many other major cities in iraq, and bring the sunn head, whichict to a could lead to possibly iran getting involved. Exactly. That is exactly where i wanted to go, professor. I saw the level of violence measurement of terrorist groups last night. These guys are out on the curb of violence even compared to other violent terrorist groups. How close are we to recapitulating the iraniraq civil war of some 15 years ago . I dont think it is going to be like that. It really wasnt a civil war, it was a war between 2 different states yes, please, force. Of course. The real scenario going on is multiple parties within the islamic world. A lot of folks think these people are not muslims, theyre just murderers, and frankly, i agree with them on that. When people hold these guys call these guys sunnis, that is a stretch of definition be on any way of looking at this. What these guys want to do is start a caliphate. They dont care about countries were innocent people or anyone else but themselves. If you disagree with them, you are dead. It is amazing what these guys professor, thank you so much. Paul sullivan on a potential caliphate in iraq. Futures not doing much right now. 1944 on s p futures. Good morning, everyone. Bloomberg surveillance we are on Bloomberg Television and bloomberg radio. 111. 75 right now on london oil. We are watching this very, very carefully. I am tom keene. With me, scarlet fu and adam johnson as well. Surprise, emerging markets well, they are not cheap, according to head of blackrocks emergingmarkets and cohead of investment at blackrock. Dr. Shenrilled to have with us this morning. I was fascinated by your note because it is so outside the zeitgeist. Every city and everyone said the emergingmarket is cheap and use it you said no. Is not cheap relative to history. Within the emerging market you find quite a bit of divergence. You have places like russia where it is cheap for a very good reason. You also have india and south africa, actually quite expensive. Air will tough question, if i could, dr. Sh a world cup quest, if i could, dr. Shen. Is brazil and emerging market anymore . I think the world cup can potentially be a turning point for the country. When you look at a chart of how emerging markets have performed, they lag behind world index for the first part of this year and then they have played catch up since then. Tom mentioned whether brazil is an emerging market. What is the distinction between an emerging and developed market these days . There is talk of korea being upgraded to a developed market. Absolutely. It is a very blurred line between emerging market and developed market. Gdp perally, 25,000 capita is a pretty good cut off him and korea is right on the cusp, somewhere around 24,000. Brazil is much deeper into emerging market. To access emerging market is important to take a global perspective. A lot of developed Market Companies have significant emerging market exposure and it is important to look at global lets bring in robert wolf, our guest host this morning, 32 advisers. I would agree. I was head of fixedincome income at ubs and was involved in the argentina emma rusher restructure argentina, russia restructuring. It seems like with the stock markets everyone is chasing yields and not differentiating between the good and not so good emerging markets, and i think that is what you are saying, then you have to differentiate local. Absolutely. There was a bit of a differentiation in may, june of last year, where we saw the strengthening emerging markets doing well. The funny thing, as scarlet mentioned earlier, is that over the past 3, 4 months, that divergence has closed a significant lead. Investors are a little but thinking, what is the next step . I think of it as three ways the emerged, the emerging, and the frontier. Thank you. Frontier being like indonesia and vietnam no, i would say nigeria. Much more they are just beginning Capital Markets. Where do you want to be . I think africa is going to boom over the next decade. Im not sure i would enter the Capital Markets rule of law is critically important and that is not necessarily here. I would be greatly numbers on tern europe right now incredibly nervous on Eastern Europe right now. Turkey jeff, can you help us understand what is happening there . Valuation in turkey is still looking quite attractive. A lot of bad news has been priced in, and the domestic story continues to be a pretty strong one. We have to differentiate the good from the back, there is a lot of dispersion within the country itself. I think that what tom said when he was talking about the oil markets was key. In the geopolitical risk Southeast Asia islands. It is so imperative or oil is for these frontier and develop markets. We will have to leave it there but we will watch oil all through the day. Dr. Shen, we would love to have you back for a longer period. Coming back on surveillance, the world cup is upon us and is brazil ready to be in the spotlight . That is the twitter question of the day. Good morning. Bloomberg surveillance. Oil is what we are watching this morning, particularly for what is going on in iraq. Joining us right now is betty liu. First the world cup, i note you will get to that, but you are also focused on the fallout from eric cantors defeat. On one side we are excited about the world cup and on one side we are excited about what is going on in washington. We are evaluating the fallout from eric cantors loss in virginia and what it means for business. He was quite friendly to big business. We have the chairman and ceo of peoples corporation, a 5 billion Real Estate Development company. Luxury properties in miami and las vegas in and in new york and one of the wealthiest black americans in this country, a big obama supporter. We will talk to him about what he thinks of this fallout in washington. By the way, he thought about buying the la clippers. He was going to go against Steve Ballmer . Maybe Steve Ballmer made him rethink the idea. You have probably both shoulders with mr. Rub shoulders with mr. Peebles. I met him a few times. He is like the west coast version of you. Going to buy the clippers. [laughter] is there a difference between the raising of the east coast, which you do, versus the west fortunately i dont have to fund raise anymore. We have developed a Good Relationship. It is one of the worst lists to be on, that fundraising list. Because they keep coming to you. The work is never done. Betty liu, thanks for joining us. In the loop begins at 8 00 a. M. Here is a story for robert wolf one of the golfers at the open will have a billionaire as a caddy. The elder Scott Mcnealy is no slouch on the court himself. I dont know he played at a 2 handicap. I dont know about gulf but i know that is good. He was a really interesting guy at Sun Microsystems ages ago. Underappreciated. He does not get the press he should get. Who caddies for you guys when you play when you and the president play golf . We are our own caddies. Rip up the script Phil Mickelsons career damaged by these allegations the other day . Not at all. Good thing about the United States is you are innocent until proven guilty. He should play golf and be the good father that he is. Were you surprised they went after him the way they did with the agents showing up at the tournament . Incredibly surprised. There are other ways they couldve done that. As someone who has been around that system, they dont care about the weight the way we think. Coming up, bnp paribas, the departure of the Top Executive. Tomorrow on the show, one of our most special guests. Ofio gabelli i the king patience. The king ofhim patience. 7 00 a. M. On radio and television tomorrow. Looking forward to gabelli. Tom keene andith adam johnson. Our guest was, robert wolf, ceo of 32 advisors. It looks like intel will have to pay that record 1. 4 billion fine in europe. The court rejected a challenge to the antitrust penalty. Sony is getting a boost from sports fans. Tv sales rose 30 in the First Quarter, the most in 2 years, and the big reason why, viewers wanting new sets to watch the winter of the mix and the world cup. The struggling tv unit may be on track for its first profit in more than a decade. Starbucks is teaming up with duracell to offer Wireless Phone chargers. Customers will be able to put their phones down on designated spots on the table and batteries will charge. Need a phone that can charge without cables. That is from the files of the reques bloomberg west. One of the great truisms of wall street part of what has become ubs americas. Robert wolf is the chair of ubs americas and knows a wall street slowdown when he sees one. An honor to have you here to get the big picture. Question,lways this should they unload the American Division . Do you suggest ubs would do that . I would hope not. It seems the u. S. Wealth management business, if you follow their earnings and leadership, it is doing incredibly well. I thinkgement they are in the top four in the United States in wealth management, maybe better than that. It is a growing business. The wealthy are getting wealthier and they are involved in stocks and private equity. I would say it is a business they should stay with. What is different in the slowdown this time on wall street . It is boring out there. What is different . One, boring is ok, because everyone is the leopar is deleervered. The problem is you need transactions to build up revenue. Slow is not fine. We are in a slow time, and the treasury market is Walking Around the 24basis point range. The interest right now is the equity market and what is incredibly interesting is in an environment where you have global slow growth, you would not necessarily think the equity markets would do well. Because acquisitions are booming, the equity markets are incredibly in a big rally. Mentioned, there are other people who will find jobs from the slowdown but there is a whole group at wall street where you wonder where they will be. When you talk about layoffs and fixed income in fixed income commodities and currencies. You talk about equities and maybe that is the only place to be. I was fascinated a research that came out of the Investment Group where they looked at the top five stocks, the largest stocks google, archer hathaway, microsoft, etc. That is where all the growth is. When we talk equities, do we just talk about a handful of stocks . It is interesting, people want dividend stocks or big blue chips. There has been a bit of a transition out of the Growth Stocks into, you know, large cap and evidence and dividends because of the low rates. Listen, im not an equity player. Im one of those boring guys that keeps my money municipals because i dont like the volatility of the marketplace will stop it seems that it is a oneway train right now. I think it is a bit scary. You see what the ecb did last week, tells everyone you have to put your money and take a risk right now. There is no alternative investment. I want to get your take on the intersection of politics and wall street. Does eric cantor go to wall street next . Job think eric could find a and a lot of places. As you know, i am not a supporter of congressman cantor, im on the other side of politics, but he is urgently business and wall street friendly and people want to understand the intersection of wall street and politics and he would be a good guide to talk to. I would be surprised if you want to work on wall street, but you never know if you would want to work on wall street but you never know. What is the dynamic over 2460 months . 24 or 60 the pendulum swings way too far one way and then all of a sudden you have to rush to hire. We are not great managers. We do well in the marketplace i think that is a break sclusive. It is a great business to focus on. It is incredibly dynamic and there will be new markets i dont mean to interrupt, but Lloyd Blankfein with charlie rose talks about paranoia. What is robert wolfs paranoia right now . Is that theia pendulum has swung too far on the revelatory side. For someone who is prorecognition and throat doddfrank, wero have to get away from rulesbased could that change anytime soon . I think it will change. At the end of the day we will open new markets, but you cannot write everything on a piece of paper and have an entrepreneurial business like we have and think it is going to work. Lets go to our agenda, or refocus focus on stories shipping today. Where we focus on stories shipping today. Finally, the world cup. I dont see an interest in america. I understand theres a whole immigrant publisher immigrant population 50 of americans just arent interested. But we hear it and well hear it over the coming days, this year is different. Ok, show me. I am rooting for argentina, i have my bracket. 4 00 have the camera cell on one of those you are a football player. The other football. By where wenated are in at 4 weeks on the world cup. Lets get to our twitter question because we asked everyone what will be the big story behind the world cup. How about these certainly that has been the backdrop. All the money that went into stadiums instead of education. That is certainly another big concern. D withy, a wide open fiel no dominant team. You go back to sochi. So many naysayers. If the structure problems infrastructure problems. If the Home Team Wins it may be a different story completely. Watch greece. Greece and argentina, toms picks. Tom, you have to head to the radio. Adam and i will continue with our agendas. Is paribas cocoo stepping down in venice of the u. S. Investigation into section violations. In the midst of u. S. Investigation into section violations. The top regular had been pushing for him to leave. He was said to retire and i guess he is pushing that up a little bit. So many questions what is the fine going to be . It would be more than a years worth of net income. That is the concern, that you are penalizing him too much. Here is what is on my agenda. At a quantity we will find out how much money we spent in the month of may month of may, right . We are in june. But 6 10 ofking up, 1 still sounds pretty paltry. What is your beach on the economy right now . I think we will have a stronger Second Quarter than most people think. We had the worst weather in like 40 years. The upside onn retail sales, consumer confidence, manufacturing payback. You will feel a little better going into the summer. You dont want equities, just bonds, mr. Low return i am boring. Himselft wolf describes as boring but not when he joins us for conversation on bloomberg also bloomberg surveillance on radio continues. In the loop thos is up next. Good morning. It is thursday, june 12. We are live from bloomberg world headquarters. You are in the loop. I am betty liu. Don pwill be joined by eebles this hour. What does he think about the fallout from eric cantor election defeat, and why he decided not to bid for the alley clippers. Here are the top headlines this morning. The coceo of bnp paribas is stepping down. U. S. Regulators are investigating the french bank for breaking sanctions. Bnp may face an historic find. Letting veterans seeking care from nonv. A. Providers could cost taxpayers 50 billion a year. Lululemon cutting its forecast even though firstquarter profits beat estimates