Reported a good quarter, but the Third Quarter guidance not needing the mark. Att stopped plunging 15 , the lows, down 18 . Its worst day since 2002. Another big story, we have been talking about silver. The spotlight today gold crossing above 1900 per ounce earlier. That haven asset, also you could say a derivative of fed liquidity on the others. Painting a risk out picture for all of this, we have the yen up for a second day. Dollaryen up 1 . That tells you investors are going into the yen, which is a true haven currency. Lots of pressures gritting this risk off picture. David it is not just the dollaryen. The u. S. Dollar is down overall. It is weakening. Is that right . Abigail yes. It has been down five of the last six days. One update was up ever so slightly. From a technical perspective it has been breaking down. A weak dollar is what happens when the fed pumps a lot of liquidity, easy money into the system. The fact you have the dollar week could suggest some traders may not like that because if you have a strong u. S. Economy and a strong u. S. , the dollar should be strong. You have a real tension. A weak dollar does help commodities and it has been helping stops up until recently. Thank you sodavid much to Abigail Doolittle for that report on the markets. We are watching President Trump as he continues to make a pivot on his position with respect to the coronavirus. Yesterday he announced he will not give a live speech in jacksonville at the convention that was so important to him. We will do amp Convention Speech in a different form but we will not do a big crowded convention. It is not the right time for that. I care deeply about the people of florida and everywhere else in this country and the world. I do not want to do anything to upset it. Trump that was president speaking yesterday. We welcome jeanne zaino, our bloomberg political contributor and a professor of political college. T iona this is a big move for the president. He had fought for this. He decided to go to florida because he wanted to have a Big Convention and now he is giving up altogether. What is going on . Jeanne the writing was on the wall, you had aids convinced him , you had apprehensive donors, you had members of the gop from congress who said they would not show up. They were going to have trouble getting guests. Then you had talk of social distancing, wearing masks, and the president and his team did not want to repeat of what they saw in tulsa. All of those things combined. The pandemic numbers in florida having increased in the last several weeks. The writing was on the wall the president had to make this move, which is something he had resisted. He fought the governor of north do it inon trying to North Carolina in a way that was socially distanced and safe. He moved into jacksonville and yesterday he was forced to reverse course. It was the right move, but for the president it is devastating because they wanted to use this to turn this campaign around. Now he is struggling to figure how to do that, drowning under numbersvastating poll out of florida and elsewhere. David a quinnipiac poll has him well behind joe biden. It is not just in florida, but also several of the border states. He is also behind in texas according to some polls. Jeanne that was shocking. The put up . Poll had himpiac down 13 points to biden. There is no way for the president to win the election if he loses florida, particularly if it is 8 or 9 . Then you move to a state like pennsylvania. You have biden up 11, minnesota 13, michigan nine, these are all devastating numbers for trump. The big fear was texas, where it is within the margin of error but the quinnipiac poll had joe biden up 1 . The president may hold that off. If you imagine their team has to keep a place like texas, they will not have what it takes to do what they wanted to do, which is bring along a state like minnesota or new mexico. Those are long gone. He is fighting for states like texas. That will be tough for the president to pull this through if that is what this has come down to. They are looking for a time and a place to turn this thing around. What with his big rally off the table, he is back to these pandemic daily briefings and they are putting out ads, but they are struggling to figure out how to get momentum. David was still a ways to go to the election. A lot could change. He did not want to count out President Trump. He has shown us that time and again. What can he do . We are watching what seems like a meltdown on the republican side just to get a proposal forward. Forget an agreement with democrats. They cannot get their act together for proposal. How will that reflect on President Trump . Jeanne you cannot count him out. We are only in july. Early voting starts in five to six weeks. It is becoming the time when the numbers start to dig in. We have unemployment up. We now have people facing evictions across the country. If the republicans cannot get their act together and pass some kind of relief for people. These are things the president will have to push for, and this is all happening at a time when you have places like the cook political report, normally conservative in their forecasting, saying republicans are in serious danger of losing the senate. They will lose more numbers in the house if the polls hold up, they could lose the white house, now it looks like they could lose the senate. These are numbers that are devastating for republicans struggling for a way to turn the ship around. In many of the states, whether it is colorado, arizona, or maine, the senators look like they will not be able to hold these seats. What was a good map for republicans has become frustrating for them. David give them a little help. If they came due and said what we do to turn this around, what are the possibilities for President Trump . You cannot count him out. You assume he will come back. How does he do that . Jeanne he Must Immediately make a deal to figure out how to help people facing eviction, how people still struggling and will continue to struggle with unemployment. He has to focus like a laser beam on the economy. That is what he has to do. What is he doing . We saw him with a tweet about suburban housewives. He should not be saying that in 2020, the way joe biden is going to destroy their neighborhoods, that is not the direction to go in. He has to focus on the economy, that is where he still wins. That is what they have to do, but that is in uphill battle. Infrastructure makes a lot of sense if he can get the democrats to agree with him, but it will be increasingly hard to make those deals with the democrats. That is where he has to focus and he has to address the pandemic and taken more seriously than he has. David he has a tall order in front of him. Thank you so much. That is jeanne zaino from our bloomberg political contributor and a professor of political science. Coming up, the plight of those who are homeless has only gotten worse with the coronavirus. We will welcome someone who has part of an answer. She is Roseanne Haggerty. That is coming up next on balance of power on Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. It is time for first word news. We go to mark crumpton. At thehe chief scientist World Health Organization estimates 50 to 60 of the global population will need to be immune to the coronavirus for there to be any protective herd immunity affect. During a social media event today, a who official said studies done from some countries hit hard by covid19 show 5 to 10 of people now have antibodies. It has beentries, as high as 20 . Boris johnson is warning the u. K. Will still be dealing with the coronavirus pandemic in mid 2021. He adds his government is preparing for second wave of infections over the winter. The Prime Minister told sky news there will be tough times ahead and said he regards those who oppose vaccinations as nuts. The Government Accountability group which includes the cities of paterson, new jersey, and atlanta are suing President Trump. It is the first of what will likely be several lawsuits challenging the president s executive order seeking to exclude undocumented immigrants from census data used to determine congressional districts. The president believes counting undocumented immigrants ultimately benefits democrats. Launched a formal complaint with United Nations Civil Aviation agency after a passenger plane was intercepted by u. S. Fighter jet and syrian airspace. I ran called the incident a clear violation of international law. Several passengers were injured as the jet dropped in altitude to avoid a collision according to reports and social media posts. 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. I am mark crumpton. This is bloomberg. David . David thank you so much. Over 500,000 americans experience homelessness. That number is expected to grow substantially when the Eviction Moratorium lapses at the end of next week under federal legislation. We welcome someone who has a plan to help with part of that problem. She is Roseanne Haggerty from community solutions. Thank you for being with us. Lets start with the scope of the project. As i understand, there are 1. 5 Million People a year who experience homelessness. More than 500,000 on any given night. Describe the issue of homelessness in the United States today. Roseanne that is correct. Over the course of the year 1. 5 billion men, women, and children , disproportionately men, women, and children of color, black americans and native americans are experiencing this problem. That was prior to covid19. The situation has not gotten any better. Everyone now appreciate something that has been true all along. The Public Health emergency that is homelessness, especially having state accommodation to protect oneself and protect communities from the spread of the virus. In addition, we see new research from Columbia University showing there is a likely increase of 40 in homelessness as the result of the economic crisis. We are speaking as eviction moratoria are being lifted all over the country and as enhanced Unemployment Benefits are coming to an end. Not only is the existing reality shameful and correctable and solvable, but without federal level action we are looking at a wave of new homelessness and enormous suffering for many people. David explained how your approach might help with that problem, community solutions. Involves our work taking a systemic approach to the problem. We work with 81 cities and counties across the country who over a dozen have ended chronicler veteran homelessness. More than 40 are seeing steady reductions. Essentially we have adapted a Public Health approach, adapted ways of solving complex problems from other industries, this voluntary movement took communities involves doing five things differently. Clear shared a measurable population level goal across the community. We see is everybodys business to end homelessness. That kind of rigorous collaboration and clarity about everything adding up to a full solution is essential. Second, communities have to organize themselves in a command center like structure where everyone with the Critical Resources are sitting around the same table going person by here. What has to happen in jacksonville, florida, they will be doing that to keep lowering the number of veterans experiencing homelessness, taking everyone one by one and will be necessary to get them out of homelessness. That is the kind of work going on in all of these communities. Three is knowing by name and in realtime who is experiencing homelessness. It is a data driven process and very much about seeing what is working using data, not only does he everyone is getting what they need, but to spot and fix logjams in the system where things are going off the rails. Also using that data to drive positions around spending, around what Housing Investments are needed, what other kinds of support will create the best benefit for anyone in the community and leverage resources most powerfully. Those are the kind of elements that make up the powerful solution, and we see enormous evidence this is the way forward. David one might think the answer to homelessness is in the name. Give them a home and it is fixed. Is that enough . Do we need to understand why they are homeless . There was a study in 2015 that set a substantial portion of people experiencing homelessness have severe or seen of get Mental Health problems. Roseanne one of the things communities have realized that are part of this movement is the community is doing this work together, bringing the datadriven discipline to the problem. Housing alone and the personal challenges individuals face are not the Biggest Barriers to solving this problem. It is the lack of a coordinated system. Think inclined to analogies from the world of Global Health help to illustrate this. The world had a smallpox vaccine for 150 years, but still had smallpox. It was not until there was a Delivery System that was very precision based, very much about who is exposed and how you get the vaccine to the right person at the right time in the right place. It is the combination of having the solution and appropriate Mental Health or other treatments and the delivery mechanism that can account for everyone across the community. What is exciting as we now see communities have figured this out communities that have figured this out are reducing and ending homelessness for veterans and those were chronically homeless, meeting homeless for a year or more common beginning to expand that work to other populations. David i do not want to let you go without talking about the macarthur competition you are involved in. The macarthur decided they would have a competition to give 100 million to an initiative they think would be transformative over the longer term. You are one of the finalists. Give us a sense of the competition and where you are in the process. Roseanne we are honored and excited by that news this week that we are gapped along with five other organizations doing beingg and vital work considered for this 100 million grant, which macarthur for the second time is going to make to a bold solution to a major social problem. Happens, wef what throughmously excited this rigorous review process that has gone on that the Macarthur Foundation has validated our approach and are evidence that this is a solvable problem that requires a different way of thinking in a different way of working. Frankly, that is the way most problems get solved. It is very helpful to have this issue elevated right now, when the country is facing such a calamity and we are hoping our federal leaders will pull together. Congress passed the heroes act in may. We are waiting for the senate to come forward with something that will match the normandy of the risk that vulnerable americans are facing. We hope the heroes act will actually become part of what the white house signs off on as a next stimulus bill. David as you say, is a great honor to make it that far and we wish you the best of luck. That is Roseanne Haggerty of community solutions. Tonight at 6 00 eastern time we will have wall street week. We will be joined by Larry Summers and katie koch of goldman sachs. Ons is balance of power Bloomberg Television and radio. David this is balance of power on Bloomberg Television and radio. Time for the stock of the hour. Today is intel. It is getting hit hard after announcing it might go out of the business of manufacturing as opposed to designing chips. We welcome kailey leinz. Kailey ugly for intel today. The stock is lower more than 16 at this point despite the fact it Beat Estimates on the top and bottom line, even raised its forecast. What everyone is focusing on is another production delay. The products are these smaller seven nanometer chips, the timing getting shifted back another six months. Now see the chips going on sale at the end of 2022 or early 2023. The reason this is problematic is because this is how they are supposed to be competing. Rivals like amd always already have the chips on the market. They are losing ground in the delay risk is exacerbating that. On the Earnings Call, bob swan discussed the idea intel may move to not even manufacturing its own chips. That idea of outsourcing wouldve been unthinkable until recently. Intel had designed and manufactured its own chips for half a century. That represents a huge shift. I would note the sell side has been quick to react. Seven firms downgraded the stock spirit one analyst said this is the worst Earnings Call they have seen from intel, and whatever credibility intel hat is out the window. The stock has the lowest percentage of buy ratings it has had since 2013. David ouch. Intel is getting hit hard. Those are harsh words. Tech is not having an easy time during the earnings season. Have seen 20 companies within the s p 500 sector. The results have fallen by 1 . This is a story of expectations being so high going into these reports. The sector traits in a multiple of around 30 times earnings. Even meeting expectations, even exceeding them like we saw with microsoft is not enough to make the mark. Expectations so high it is easy to come up short at this point. David thank you so much to kailey leinz for that report on intel having struggles. That tech issue may be related to the next issue, which is u. S. China relations. Ashton will be here. Now we have to taint someone who is a researcher in california from china. Whoe have detained someone is a researcher in california from china. We will cover that on balance of power on Bloomberg Television and radio. Businesses are starting to bounce back. But what if you could do better than that . 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. 49i found you good job. Now im gonna stay here and you go hide. Watch your favorites from anywhere in the house with the Xfinity Stream app. Free with your xfinity service. Now any room can be a tv room. Stream live tv, on demand shows and movies even your dvr recordings. Download the Xfinity Stream app today to stream the entertainment you love. Xfinity. The future of awesome. David its time for bloomberg first word news, we turn to mark crumpton. Mcconnells stimulus waiting game has turned to a race against the clock. He waited until a key component of coronavirus aid was about to expire before drafting the republican version of the next release will. The relief bill. So he struggled to unite republicans to unite behind a 1 trillion plan. This is days before the federal Unemployment Insurance benefit expires. Sia promises to retaliate china has promised retaliate after the closing of a consulate have,ston, and they beijing ordering the closure of the consulate in chengdu. The coronavirus numbers in florida continue to climb, cases 402,0002 today, with confirmed infection. And a rising of people record. Ized, reaching a the Toronto Blue Jays will play their home games in buffalo, new york this season. Governor andrew cuomo said that he spoke to rob manford this morning, the team has been trying to find a u. S. Location after the canadian government declined to allow them to lay in toronto to play in toronto. 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. David thank you mark. As mark was talking about, theres arising escalation in the conflict between there is a rising escalation between china and the United States. Apparently detained a chinese researcher in San Francisco who was seeking refuge in the chinese consulate. Out. Is here to sort this i dont know if you can, it seems complicated. Give us your sense of where this conflict lies. Of thes impossible u. S. Government ordering the closing of the chinese consulate. We dont have enough information. When the state department comments on this, including secretary pompeos comment, it did not really illuminate anything. The accusation is that the consulate was a hub of spying and intellectual property theft. There are not a lot of specifics there. What we can say with certainty is that ordering another is anys consulate closed absolute escalation and tension in the relationship. And this is the most important the real important relationship unites states has, arguably the most important in the world. Not a great direction for things to be going. It was followed by the president making remarks that there could be additional consulate closings. And shortly after that, news broke that the San Francisco consulate was harboring a fugitive. That there was a chinese researcher indicted for having anditted fraud misrepresenting her ties to the chinese military. And she was taking shelter in that conflict. The chinese confluent consulate in San Francisco has released that person to u. S. Authorities and announced that they will be ordering the closure of the u. S. Closure in chengdu. A some ways i think this is relatively positive resolution of the situation. By turning over the person that was taking shelter in the San Francisco to San Francisco consulate, china may have done what was necessary to stave off any additional closings and it should be no surprise to anyone that if the u. S. Was going to , thenfirm on its position china was going to respond with some sort of reciprocal action towards the u. S. Consulate there , because that is standard in chinese diplomatic relations. But the houston consulate has a long and storied history in the United States. Its the oldest and figured prominently in the normalization the 70s. Asians in this is not to significant in terms of our relationship now, it carries a symbolic weight which is hard to summarize. Do we have a sense of whats going on behind the scenes . If anything . We have seen a very public display, are the negotiations going to be behind the scenes on how to resolve this . Are we communicating what we want . Important point. We have had two plus years of tension over trade, but there was also dialogue. We finally reached an agreement which should have put the relationship and a better place. Obviously there have been extenuating circumstances that nobody could have imagined unfolding with the way it has during the pandemic. But at this point rather than having a more peaceful and productive relationship, we have thats thetoric and predominant theme towards china. Its not clear that theres consistent and regular dialogue happening on the host of other issues outside of trade which are really driving concerns on both sides of the relationship. And its important that we get back to a place where we are engaged with china on the entire menu of issues that impacts our relationship and the world, which is which historically is how we have dealt with china. We need to get back to Something Like that. David you helpfully direct is just to the first three years of the trump administration. There was a lot of hostile language but also negotiation and we thought we had a phase one trio and now the president says hes not sure he cares about that because everything has changed. Is phase one data . Anna i dont think phase one is dead. Robert lighthizer worked incredibly hard on this agreement and works very closely with chinese counterparts. , think the resulting agreement while it does not address every issue that is important in their relationship, it did make significant and important headway on issues that we have struggled to make headway on her long time. And furthermore it involves an enormous Purchase Agreement that goodness knows what help the u. S. Economy recover right now. China is lagging in his purchases but thats expected for a of reasons. China had its own massive , this reallyreak affected the trade in the first quarter. And a lot of the Agricultural Commodities that china agreed to purchase are not seasonally purchased in the first half of the year and we would not have expected to them by now. And we saw the Energy Markets tank and so the commitment to Purchase Energy became impossibly daunting at the beginning of the year. But thats on its way to an improved place. We have heard consistently from u. S. Trade representative officials and other that the chinese continue to make a goodfaith effort to and theretheir commit is agreement that its coming along. I think it is something that the president acting he thank you will cast it aside is very concerning craig lessing americans need is for us to end up in a situation where we resume the last thing americans need right now is presented in a situation with trade tension. This would have affected all consumer goods, and if people are struggling to pay their rent , we also make it so they cannot buy groceries . David always hopeful to have you with us anna. Shes a senior director at the u. S. China chamber of commerce. We are staying with china, specifically as there is increased conflict between the two countries and we will look at the text cold war. Our correspondent has done our guest has done a correspondence on that. This is bloomberg. David this is the bat this is balance of power on bloomberg. Given us collating tension between the u. S. And china, theres more discussion of a cold war with china, particularly with technology. The question, will that cost. Our guest has done a detailed study and hasnt answered to the question. We welcome him to bloomberg. Here. You for being how much would it cost . Apjit if there was a complete decoupling with china and you had offline demand, we wondered what the cost would be . And the number comes to a staggering 3. 5 trillion. There are three segments. The first is chinese organic in demand, where china buys globally and it comes to 400 billion a year. The second is the supply chain, which china has taken four years to build their networks, and if , then get to a decoupling it has to be reestablished in other parts of the world. And the cost of that is about a trillion dollars over the next five years. Some experts believe it would take 10 years for it to move. Wallast is called the tech , if things get very tense you have rising standards globally, the chinese will have their own ders like 5g and the west their own standards like 5g and the west would have their own standards. And there would be an expectation that countries would have two sets of standards to operate. If you add the three together over five years it would be 3. 5 3. 5 billion. David Business People are notorious for being flexible and to redesign. Are there substitutes for selling technology into other countries . Are funding of the supply chains that we could substitute . Apjit yes, thats exactly what will happen. If you look at the philippines, vietnam, india, malaysia, even in south america and the u. S. , there is talk of transferring the supply chain, but takes time. He took 40 years to build a relationship you cannot switch it off in one day. It will take five to 10 years. The issue is that a lot of those thoseies do not have networks, the important thing for tech packaging is the cluster of networks together. You have moving parts and it takes time. It would take five years for things to move. Area, when is your you talk about tech it encompasses a lot of different things. What parts would be particularly hardhit . We looked at the second part of the report, which measures the intensity of the last five years and we ran it with different sectors and whether it was sending it out as hardware or software and to see what has high exposure to china and how this has reacted. The markets are fairly efficient, sectors with high exposure will be the ones hurt most whether its through chinese demand or supply chains. The one place where china has a deficit, and one of the biggest bones of contention, is semiconductors. The Stock Performance has been inconsistent with the fundamentals. When tensions have been rising over the last five years, the sector has outperformed. That is something to question going forward. Of theand thats one things that jumps out in the report, semiconductors are almost a sport, do we know why . Is thathe way they work liquidity is a driver. Things faangs with the tech rally. And they have had a strong run there is anuidity, ignoring of the risk. And the question is, the markets are looking at two different things, liquidity and risk with china. It is obviously still believing that the liquidity will be Strong Enough to disrupt the entire relationship. You do have these periods where the market would rally for five months and thats what we are putting light on. Is this figure then people are discounting . David when we talk about a cold war, the last time was the United States against the soviet union and your study took a look at what happened to Government Spending from that. Give us that analogy from the present day. What would happen if we followed that course . The cold warou had the time ofs around sputnik, you had a major leap in government r d. Spending went up nearly two times. And covid is one of those moments where the tech sector globally has not had much government support. Its been corporate dominated. The question is, will governments look at the tech . Cosystem and look at funding i think that will be the big story. The one positive of getting involved globally with tech. But one glaring difference is that we have been very integrated in our economy and that was not true with the United States and russia. So one real cost of this would be disentangling those. Apjit that is the cost. We are looking at two unprecedented factors, global liquidity which has been there , and anears unprecedented cold war. We cant exactly say what happened in the last one because the two blocks were so divided. And to be absolutely clear, you are not predict this is going to happen. The cold war you are positing is a total disentangling, an extreme case. We looked at what would happen if that did happen. Apjit we essentially wanted to put a mere to the reality, not try to predict what will happen. There are very complicated decision trees and how they play out. One thing that is true is that this is a structural issue. This is not going away anytime soon, especially with ai and semiconductor. David thank you for being with us and i want to commend this study to anyone interested. Its from deutsche bank. Thank you very much. Coming up, wall street week is coming back tonight at 6 00, we koch ande cocked Larry Summers as guests. This is bloomberg. David this is balance of power on Bloomberg Television. We are making making money in the market is no easy fee. Particularly if youre a hedge fund. Nick spoke earlier today with our colleague eric and talked about how to make money in this market. We have heard before and the reason still holds, are they in a better or worse position . Company with advertising exposure will be herded they dont do well, the question is how much. Two is asbout those an investor that cares about spreadsheets rather than soundbites, it is something that we can have conviction. Yourself and make sure you can do things where you will not get scared at the worst moment. So is amazon a Great Company . Absolutely. Would you like to be jeff bezos . Sure. Ats a Great Company, is that 165 times earnings . Im not sure anyone knows. On facebook you dont have to be a new paragon guide. Traditional multiples on traditional metrics works fine. And for them specifically, on top of it you get use facebook as an example, whatsapp is arguably one of their most important franchises, but less in the u. S. Especiallype and asia everybody uses whatsapp. They dont make a penny from it and if anything is costing them money because its an expense center and not a revenue center. So facebook is really instagram and facebook. And its to grandma still a great business that is still growing and whatsapp is an incredible franchise. Its a decent multiple and you are getting stuff for free. Google is the same way, theyve also spent a fortune on things that have not shown value but someday will. Whether its automated driving or other things you can put money in. If theres any one company where i have high confidence that they are going to have their fingers and the important products down the road, its a combination of great franchises i great price. Because ultimately, agreeing that something is a Great Company but having a price be crazy doesnt get too far. , withed some bargains microsoft i would not have a quarrel with, but with amazon wheret into territory its a great thing but i dont know how to of exxonat was the ceo Capital Management axon Capital Management. Coming up, we will talk about a congressman to talk about federal agents policing u. S. Streets and also the Texas Attorney general. He has become one of the cochairs of lawyers for trump and he will talk about his lawsuit. This is balance of power on Bloomberg Television and radio. Jonathan pro viewers worldwide, real yield starts now. The u. S. Recovery losing momentum. The fiscal side of washington commencing, sending real yield into negative territory. The u. S. Installing and europe is recovering. The u. S. No longer dominates europe in terms of outlook. The europe has been the best in dealing in this crisis. The u. S. Is allowing Health Issues to dominate the economy. It looks very interesting. You are getting real fiscal stimulus. The tailwind is less. Definitely a game changer. And need to do everything it can. This is really significant. The case for a rotation towards europe is strong. The m