Continue to move higher today. , e is that pesky news going after Apple Computer in europe. There is a lot of apple business in europe. Is peskyot know if it or warranted, i think the antitrust probe will lead to a conclusion. We saw the french watchdog a couple of weeks ago say they are looking at syntax. This is something we are concerned about when it comes to apple pay. Whether other can have access to this. To sees a probe going on whether there is an unfair advantage to apple. We are not having these discussions so much in america. Right now, it is our first word news. One of the largest provocations north korea has made in years. Kim jonguns regime has blown up an office on its side of the border, according to south korea. Anth korea has issued escalating series of threats against the south. It is unhappy that the south backs the u. S. Led sanctions. Jerome powell is expected to give another downbeat view of the economy. Hearings two days of on capitol hill before the Senate Banking committee. That is at 10 00 a. M. New york time. Policymakers held Interest Rates at near zero and said they would probably stay there through 2022. The administration is preparing an they plan to spend almost 1 trillion on infrastructure. Money would be set aside for roads and bridges, it would also spend on 5g networks. The u. K. Antie. U. Believe they are one step closer to a brexit deal. And the eu call has injected momentum. Johnson is willing to soften his position. Officials say they are willing to do the same. Global news, 24 hours a day, on air and on quicktake by bloomberg, powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. We really can say so much. I go to keep this short. We have a great set of guests this hour. Equities surged higher in the last 24 hours. We have seen 10 big figures on the vix from a 24 to 830 four, now even under 34. Futures up big. Another percentage point moves there. Yields across all bc, higher. Francine i am also looking at yields, they are significant given what we saw yesterday. I am looking at this global stock rally continuing, europe gaining 2. 2 . The pound up after positive talks around brexit. 1700. Gold, 1700. Joining us is kevin cirilli. What a joy to actually talk about policy. Not the protests, not the pandemic, but may be something to be done on capitol hill. Lets begin with principles on infrastructure. Why does infrastructure fail to pass on capitol hill . Kevin because of the price tag. Republicans prior to this that were skeptical of this type of stimulus as it relates to infrastructure. Those folks are still at the table. Infrastructure is something the president has suggested he would like to get done. That is a 1 trillion investment. Funds would be set up for 5g. The funding is set to expire september 30. Broaderabout the economic stimulus, the Trump Administration saying if we are unable to get to a coalition of early august, may be stimulus coming ahead of november would be something they do. Something from an american policy perspective that, regardless of who is in the white house, will likely come to fruition. is the way this work there is going to be a bridge to nowhere in florida, a bridge to nowhere in kentucky, and a bridge to nowhere in san francisco. Maybe Speaker Pelosi will get a bridge to nowhere in baltimore. This is politics 101, and it gets done. Who is against this . Kevin more conservative members who are worried about the price tag. You make a good point in terms of pork and political favors. That traditionally has been done, but this is a different time. We are in the middle of a massive economic downturn. The president wants to inject fuel in the economy. When i talk to sources in terms of stimulus, they are saying lets give out the funds already allocated before they pass another round of stimulus. 5g, from anderscore 5g perspective, with the administration is saying is that it is not just about roads and bridges. Worried the Biden Campaign has been pushing infrastructure stimulus for some time. Wins inss of who will november, infrastructure likely in the next 1216 months. Does it give an advantage to the Trump Administration because they are in charge now so it will be seen as a trump thing . Kevin that is a smart point in terms of the messaging heading into november. Ae political reality is that massive type of legislation typically does not pass before november. , it willlly speaking be difficult to get something done before november, but we are not in a typical election year. The dust is still settling. Francine what does President Trump think get him reelected . Is his success still with stocks, how much of it is on the economy . Kevin reopening. Economy. The i spoke with a source on the reelection campaign, they told me to look for saturday at this rally in tulsa. There has been controversy, but this rally i am told is going to be massive. There are going to be individuals from across the party on stage with the president , really showing from a republican perspective there are moving to put the virus behind them. Contrast, this is an opening bid to the Biden Campaign which has been reluctant to hit the campaign trail. quickly cure, dose quickly, two books, one on the first lady and one from mr. Bolton. They will be extraordinary . , with the administration regards to john boltons book, they are saying not so fast. It could end up in the courts. This is pure washington. If your book is controversial, that means you are going to land on the New York Times bestseller. Stephanie grisham, a spokesperson for the first lady said it is pure fiction. Tom ok, thank you so much. Never pure fiction from mr. Cirilli, our chief washington correspondent. Coming up, Kenneth Rogoff. Stay with us. Futures elevated. This is bloomberg. Bloomberg surveilence, from london and new york. Chairman on the hill for two days, used to be called humphrey hawkins. Always interesting to get the q a. It will be interesting to see. I wonder if they will address negative Interest Rates. I do not think it will come up. We can do that with our guest, Kenneth Rogoff joins us. He has been a wonderful supporter of bloomberg over the years and we are thrilled he could join us. Your o ask you about the curse of cash. It was my book of the year a few years ago. Update give us an update on the efficacy of negative Interest Rates in the United Kingdom and United States , given how they are fine it given how they are Financial Systems are so different. Would negative Interest Rates help . Ken right now, there is so much going on, i dont think it would be a good idea to do something so experimental. Years, after the government has gone through many ,ore stimulus spending measures after the Federal Reserve has tried to guarantee it has been a credit provider of last resort for a long time but things are not growing. I absolutely think this should be on the table. It is silly to take it off the table. It would work, but it has to be done right. I dont think europe has done it right. You have to deal with cash hoarding so you can make Interest Rates very negative. , the studiesed coming out of the European Central bank have been finding negative Interest Rates work well. They have not caused the problems people said. Through oneen paths the Banking Sector from healthy effect ony find the investment similar to the normal monetary policy. I think that is what we can expect in the United States and the u. K. Tom are we nationalizing the bond market . That is the question chairman paulison will get from the center today. All of these programs including the announcement yesterday they will lets say they buy is it bonds anything but a nationalization of debt . It depends on what happens next. If it turns out things get better quickly, this will look like a low cost move. Funny, usually in crises before this, they would say, here is a company we think is solvent, but there is a liquidity problem so we are going to provide liquidity and make sure they can still get financing and not go bankrupt. On, there areoes a lot of companies that will need to change radically. They will be liquid because of the fed, but not solvent. They are going to run into trouble. They are taking a gamble. Buts a smart gamble, absolutely it is a gamble. Of course, this cant go on forever. You cant just have the taxpayer guarantee every credit in the economy. Francine good morning, you could also have a situation where you have a second wave but only pockets of the economy are closed. How likely is that we have a second lockdown like we saw . Ken good point. I dont know. Do iter if we have to again, if we locked down in the same way there are papers floating around that there are smarter ways to do it. I dont know. It is not just what the government does, it how people react. There are just localized problems that can be contained, it is not an issue. The likelihood is the likelihood of a major second wave is very high going into late fall and winter. Maybe we will be able to deal with it better, but that is the concern. Enoughmething that was to scare people back into their houses. There are things like restaurants, hotels, cruise ships which feed into those which are going to need to be restructured. The question is how far that is going to go. Are we going to still be in cities the same way we were . I do not know. I suspect there is going to be a lot of restructuring. We have not mentioned the political change which is going to have an impact on corporations. I do not think this is just i think we are going to see an acceleration of the movement for redistribution of income, deglobalization is going to have impacts on some firms. Talking we have been about deglobalization, do you think it will be a very stark globalization deglobalization, or are we going to quickly get back to normal . How long will it take to go back to normal . Had waves of globalization and deglobalization in the past. My view is that we are headed for deglobalization anyway, for political reasons. Trump 2016 catalyzed that. There are things going to be brought onshore for National Security, and a lot of other things brought onshore supposedly for National Security reasons, like canadian steel. I think it will be significant. A lot of countries are nervous. To strengthenry labor unions, that is hard to do when you remain highly globalized. Harvard, youhat at free lunchourse 302. Free lunchlain the of zero bound . Plunge goes to zero, who knows . There has got to be a price. Ken it depends on what we do. Now, the global normal real Interest Rate is negative. Andn that inflation is low they are not prepared to use negative Interest Rates, which is the only way to raise inflation if they wanted to. Concern really is this idea that therefore companies can borrow as much as they want and the government will bail them out. The government can borrow as much as it wants in the Federal Reserve will bail it out. Of course, that is nonsense. There are limits. We are doing the right thing now, but it cant go on forever. I suspect we are going to see it go on for a long time. Tom ken rogoff. We are thrilled you can continue with us. We have a wonderful set of conversations for you with professor rogoff and other than adam tooze will join us. And then, the secretary of labor will join us. We will speak on the job economy and the Supreme Court ruling. This is bloomberg ncine biggestthe second tmobile shareholder says it is considering the sale of its stake. The firm says it may sell some of its share through public offerings. Is part of as softbanks offering to sell 1 billion in assets after record losses. Number learned of the firm was preparing to sell 20 billion 20 billion of tmobile stock. As a tense comfortable tense couple of months for ray dalio. His hedge fund suffered a 15 drop in assets during march and april. That was because of heavy losses at the firms flagship trading strategy. That is the Bloomberg Business flash. This is what markets are telling us. A little bit of focus on the pound after we had positive move positive news on the phone call between the commission and Prime Minister boris johnson. Continue to rally, as we have been saying all morning, is on the back of the americans to the meal us. The american stimulus. Gold, 1731. Oking at tom up we go. Green on the screen. Up 484. Res s p futures up 1. 3 . 41 points on the spx. Kenneth rogoff of harvard university, stay with us. This is bloomberg. Senator scott of florida at noon. This is bloomberg. Francine this is bloomberg surveilence. Were talking about the world economy, also the u. S. Economy with ken rogoff. We are back. I wanted to ask you, professor, about china. How is china changing because of the pandemic and what is going on in hong kong, and the fact that they were blamed by many countries for letting of the pandemic it out of control . The u. S. Was probably the main culprit in the 2008 financial crisis but seems to have come out of it stronger than the rest of the world. The dollar is more powerful than ever. China will be blamed, and probably should be for this pandemic, but it may come out stronger. We do not know. Certainly, they are going to have a tough time exporting with the world in recession, roles growth slowed. I think there is going to be more trade restrictions on china. There are trying to run their economy with restrictions on movement, trying to prevent the disease. They are not going to have an easy time maintaining growth. People who think they are going to come roaring back in a year, i do not see it. Tom with your Public Service to the imf, and your iconic textbook on international economics, is that the era of multilateral over . Ken i hope not. Clearly, we need it more than ever, although there is change in the landscape. Has become a huge issue, even in the financial sector. Of way tome sort cooperate over that. In conventional finance, i am expecting to see a lot of bankruptcies in emergency in emerging markets. We are going to need the imf where you have such financial problems. We are going to see a food crisis. That seems to be on the horizon. We are going to need the world bank for that. I hope not. The United States has been less interested than ever in these organizations. We need them. Rajeev tom this is tom these are important comments you are making. Are we not preparing for those troubles because of derivative instruments, securitization and nations andt is not corporations representing interests . We have literally financial is those relationships with the emerging markets. Helped emerging markets in developing economies by being open to trade. That has brought billions out of poverty. Been the most has important Foreign Policy of the United States. We are now running that into reverse, becoming a lot more focused on ourselves and more willing to block trade in various ways. Also, they need help. I think there is a humanitarian crisis shaping up in the third world and developing economies the likes of which we havent seen since the 1930s. All of the forecasts are showing this is the worst or second worst recession since 1870. Talking about spending 3 trillion, 5 trillion, 7 trillion in our own country, there is no discussion of foreign aid. There is no discussion of multilaterals right now. That is going to come back to bite us. It is not just humanitarian, but civil unrest and political problems there is certainly even if we managed to get out of this at 95 of what we were, which would be good in a year or two, the rest of the world is not. Doy do not have the money to stimulus, to keep people dont haveto they resources for the collapse in oil prices and global trade. There are 6 billion people plus living outside of the advanced economies and they have been thrown off the track they were on the last 30 or 40 years. This is a huge issue coming up. Are we going to talk about debt release . Ken we are talking about debt relief, but not doing much. G20 did some debt relief for the very poorest countries where theres is not a lot of money at stake. The private sector has not kicked in. Maybe china has. We are at loggerheads at the moment. There are going to be defaults. The question is, how will be try to make that happen faster . Restructuringbt unwinds over years, i think seven years is the average. At the least, we have to try to make that happen faster. Ken rogoff, thank you for joining us. Ken rogoff of harvard university. We will speak to professor rogoff more. Lets get straight to first word news. Today, President Trump will sign an executive order on Police Conduct and reforms. It is his response to nationwide protests over george floyd. The order will lorch will urge police to restrict force policies. There will be grants for departments who curb chokeholds. The Federal Reserve is stepping up its emergency lending. The bank will begin buying individual Corporate Bonds. Until now, the fed has only about Exchange Traded funds. The fed says it will allow a diversified market index of Corporate Bonds today. Out ag trying to single new coronavirus out rick. Coronavirus outbreak. Beijing closed and food market after a case linked to the original cluster was discovered. Invard has joined its peers a major shift in college admissions, it wont require standardized testing for the fall of 2021. The pandemic has restricted act. S to the sat and the harvard says the changes temporary. Glo