We are going to talk to the cio of capital. It with some of the atlantic you want to put your money in . We will talk about that in the United States. U. S. Labor market continues to be a big focus. The jobless rate is 10. 2 . Ofs is quite a bit shutdowns, a lot of hotspots. Jonathan ferro talked to larry his take in that. He was raising that point about the hotspots and how good he thinks this number is. Is july 20. Thesurging hotspots in south and west in other places began in the back end of june and lasted through july. There was some pullback of reopens. 1. 8 million. That was a big decline in the Unemployment Rate. This will move the Single Digits easily in the summer and fall. That is larry kudlow talking to Jonathan Ferro earlier on. Larry kudlow is trying to put a positive spin on things. This looks like a good report. Is a good report . We made progress. Thats the important thing. We didnt backslide. It was a very wide range. There has been a lot of noise coming from a variety of different sources. Survey,he Census Bureau which ended. It went to the reference week. That was suggesting a decline. The home base is starting to show a flattening out of people reporting to work in key service industries. We had the unemployment claims which continue to be in the millions every week. Leading up to this data, there was a lot of reason to suggest that the pace of increase had slowed. Slowed, the good news is its continuing. Some continuing despite slowdowns we see around the country as a result in cases. To put this in perspective, you can look at this with percent change, you look in the second and third derivative. If we look at levels, on a percent change basis, we are down 8. 1 on it gdp. We are down 8. 8 on jobs. That is still a big hole in the economy. This Unemployment Rate that we are at, its where we were in the peak of the financial crisis. The question that needs to be asked now is what part of the economic damage that we see is covid induced, what is general recession. Have a the goes on longer, that starts to impact other parts of the economy. Levels and mentioned derivatives. Its only 11 00 a. M. Talk to me about those levels in those First Derivatives going out forward. I keep hearing we are bound to slow down a little bit and this might be the last good report we see. The indicators i love to look at is the diffusion index, which tells you the breath of the jobs change. It was at 75 in june, indicating we had a very raw increase in jobs. That was a big increase. We got almost 25 of the jobs that were lost. If we look to where we are now, that has fallen from 75 to 61. 4. You see that is shrinking. Unless we get the virus under control, i would expect us to remain in this lower breath of job gains. There is some worry it could fall. To look to the problems of the virus and as it theads out, we see that in employees that are temporarily unemployed versus permanently unemployed. That number is ticking higher on the percentage of those that are temporarily unemployed. There is room for concern and worry. Whats driving that concern is the virus. Tomorrow andaccine we could distribute that vaccine by the end of september, we would have a very different outlook. There is part of the economy that is being dictated by the virus, then there is whats being caused by the virus. Guy many people will no longer be getting 600 in the government. We see the arguments raging indecency about which way the stimulus package should go. What impact is that going to have on the u. S. Economy . The savingsee is rate has gone up significantly. People that would be spending on things like travel, restaurants, concerts, people just are not spending on that. That tends to be the higher income earners, at the people getting 600. The majority of those are ,pending it on food and rent and that is where the concern is. If we have significant fall out , that is going to end the firewall that we put around the covid damaged economy. Its going to bleed out into other sectors. Commercial real estate is affected. It will affect residential real estate. We dont want it to bleed out into these other sectors. We want to keep that firewall around the covid impacted part of the economy. Taylor im curious if you are worried about deficits we are running and that leads to higher inflation when companies are heading out wage increases. What is the impact of rising deficits . There only three ways to get a date. You can inflate your wet, pay your wet, default. If we get inflation that is full inflation, bets for a welcome in the face of this debt. If we get inflation that is pushed induced, that is much less healthy and not good for the economy overall. It depends on what type of inflation we get. I am not terribly concerned about inflation. Said, we are extremely levered. We have a lot of tailwinds to a full recovery when we get a vaccine. I mentioned the increase in savings. We have seen money supply increase much more than during the financial crisis, up over 25 . It was china that led out of the Global Financial crisis, now it is the u. S. Leading of the covid crisis. We have the fiscal stimulus. Its not really stimulus. Its more relief. Its plugging a whole. The most important thing is to keep that firewall around the covid impacted economy until it so it doesnt bleed out to the rest of the economy. Growth, the debt is an immediate problem. If we managed to stave it off and we can engineer some growth coming out of the covid impacted part of the economy, we have some possibility of growing our way out of debt. Taylor thats always well said it. Thank you so much, constant hundred constance hunter. About covid out cases in europe. This is bloomberg. Federal Appeals Court have given House Democrats of victory that congress consumed to enforce subpoenas. Revises those triggered when his aides were immune from congressional subpoenas. That hobbled has to get testimony during the russian probe. The matter will likely go to the supreme court. Details on a new Coronavirus Relief bill is on the verge of collapse. The two sides are far apart. The talks are rather stalemated right now with a better tone earlier this week. There had been any breakthroughs. Thats unfortunate. No new talks of been scheduled. Sticking point is the 3 trillion in aid. The Trump Administration is imposing the sanctions will be carried out under an executive order that President Trump signed last month, seeking to punish china for its moves against dissent in hong kong. Moresh tourists bring destruction to their Summer Vacation plans. The bahamas is loaded to the quarantine list. To quarantine for 14 days, its already on the list. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries, this is bloomberg. Guy lets talk about that pick up in case counts we see in europe. Associateed by the professor. Thank you for your time today. Pickup ofing a certain parts of the continent, certainly spain has been in focus, frances come into focus. What is your assessment of what is happening here . What were not local lockdowns can achieve what National Lockdowns achieved earlier on, contain the virus . If they are done right, they can. We are seeing localized upticks in the number of infections. Thats how they start. They dont start everywhere. They come up in Little Pockets and localized areas. Outget a general nationwide break, it spreads from there. Taylor how are you thinking about a more targeted approach versus mass lockdowns . We continue to think we cant read shut down the economy all over again. How do you think about appropriate ways in which to do this . To do first way to try is localized lockdowns. We had that in the u k arguably, theres been success. Whether that will be as successful in a bigger outbreak you might geteak, in the fall or winter. That remains to be seen. Its worth trying smaller shutdowns before contempt it contemplating going nationwide. You have looked in the past at what is happening with this spirit of this is one of these key conversations because a lot of us are trying to figure out whether to have kids go back to school, what role kids play if they are asymptomatic. New york is about to make a big decision on whether or not kids go back. What is your assessment of how school,kids back to should we be sending them back to school . They have to go back to school at some point. They cant stay off forever. We know that children do get the virus despite what some people are telling us in the late winter or early spring. Children dont seem to spread it is much as adult groups. Adults are more likely to spread it. Kids have got to go back to school. Its got to be managed right. There has to be a discussion between government level, schools, teachers about how to do that sensibly. Its not without risk. I do think it has to be done. For a vaccine. Are you confident in the timeline that we have for vaccines, january 2021 . I think that would be an incredible achievement. Even if it were early spring, that would be quite an achievement as well. Its not impossible. Its unlikely. Spring or summer of next year is more likely. Even that would be a pretty hefty achievement. We should be disappointed if we dont see one in the new year, but we do see one of the spring or summer. Phase 3 is pretty tricky to get through. Lets talk about what happens in the absence of a vaccine. What is your assessment. About wesilly to talk are clearly still experiencing relatively i case counts around the world. What happens in the northeastern United States, here in europe, when we can no longer enjoy the beautiful weather i can see outside right now . What happens when we are all stuck inside . What do you think the pitch will look like . People are going to start mixing more, but indoors. Pubs and restaurants in the u k or elsewhere are close. They will do it in their own homes. We know thats a really good place to transmit the virus. Risk associated with autumn or winter is going to be more what likely people mixing indoors rather than outdoors. That is just a guess. We havent known about this virus for a full year yet. Aroundably shouldnt go making seasonal judgments. We just dont know. Its not an unreasonable hypothesis to assume things will get worse in the autumn and winter. Taylor thank you as always, tune in for a balance of power special with dr. Anthony fauci. 7 30 tonight. This is bloomberg. Guy im guy johnson. Taylor riggs is in new york. Lets turn to turkey now. Authorities ending a tumultuous week in the Financial Markets. This has helped the lira pullback against the dollar. Joining us now is our Turkey Bureau chief. Lets talk to the week weve had and put in context the comments earlier on from the president. It feels as if this week has taken turkey to a crossroads in terms of decisions its got to make. Does it backtrack on some of the rig geopolitical decisions . Does it backtrack not to raise rates . Where are we in terms of the conversation that is happening with the policymakers in turkey right now . Which direction will they take us in next . Its like 2018 when the lira was in freefall. The was on the back of rates. This week is very much like the week we had in 2018. It doesnt backtrack anything in turkey. From record falling lows the past few days. A stealththe back of with the financial banks today. Taylor are the policy decisions you talk about, the policy shifts working . They seem to be for now. I do think we have seen an and to depreciation. Seems to haveon come to a pause as of today. There been some interesting decisions by policymakers. Today it looks like the central bank has tightened access to credit by forcing lenders to aro from more extensive borrowing windows. This comes after the decision i turkish authorities to tell the ask they dont have to lend aggressively as they did for the past few months. Thats one of the reasons that resulted in the heightened demand for dollars domestically. Just very briefly, is there domestic dollar savers are going to take those dollars out of the banks . That would be a pivotal moment. That is true. There is no sign turkish will have any russia take back their money. There is nothing like that at all. Taylor ok. Guy we will check in over the next few days. Thank you very much indeed. Thank you very much indeed. We are approaching the end of the day in europe. Equities are bouncing around, driven by the story in the United States. We will deal with all of these details and give you a sense of the week we have seen. Light volume, equity markets are high. This is bloomberg. What happens when a wireless carrier puts its customers in charge . Well, the good news gets shared. And it gets rated 1 for customer satisfaction. But dont just take our word for it. Take theirs. Its your wireless. Your rules. Only with xfinity mobile. Call, click or visit a store today. Yeah. This moving thing never gets any easier. Well, xfinity makes moving super easy. I can transfer my internet and tv service in about a minute. Wow, that is easy. Almost as easy as having those guys help you move. We are those guys. Thats you . The truck adds 10 pounds. In the arms. Okay. Transfer your Service Online in a few easy steps. Now thats simple, easy, awesome. Transfer your service in minutes, making moving with xfinity a breeze. Visit xfinity. Com moving today. Guy we are nearly done for the week in europe. Lets talk about the numbers we have seen in terms of the session and on the week to give you an idea of what is going on today and the context behind that. Lets start off with the session we have seen today. Broadly we are higher. Finishing your session highs. Up near. 2 . The markets trying to figure out a bunch of things and it felt today as if despite the betterthanexpected payroll number, the market understands there are risks that are growing around the stimulus story in the United States and what is happening with the growing sense of dislocation between china and United States. Xx 600 up. Lets take a look at what we look like on the week. A drift sideways. It is august. We are treading on light volume despite the fact we continued through the earnings season relatively unscathed. The market does not seem to have a strong sense of direction. The stoxx 600 up nearly 2 . In terms of the individual markets around europe, lets talk about what has happened. We have seen underperformance from london. The Mining Sector and the Big Oil Stocks adding weight to the downside for the ftse 100. Decent data out of germany. It has outperformed the cac 40, fairly flat on the session. In terms of the sector story, lets break it down. The main drag. Heavyweight names like bp and shell in the mix. Seeing giveback in terms of the oil story in terms of the numbers. , oil and gas are the big drag. Tech and industrials are treading to the top end of the market. A lot of weight at the bottom. In terms of some the individual names, the u. K. Housing market bouncing back. Better maybe than the market was anticipating. That stock has done relatively well. Hickmato talk about pharma. It has a deal with gilead on helping administer remdesivir. That deal certainly allowing decent share price bounce today. The numbers looking good as well. Ppi this is interesting. They are pointing to a relatively muted trading story going forward, which is not what we are seeing elsewhere in terms of some of the trading numbers. A positive weight for european equities a positive week for european equities, a fairly flat friday delivered with low volume. Taylor we turn to what is trending. It is all about the uncertainty of the stimulus bill. Bloombergs Jonathan Ferro spoke to President Trumps economic advisor, larry kudlow. Kudlow if the congress does not act, if there is no deal, than the president will take his own actions. The solution is to come to a progrowth, common sense, pragmatic compromise. Thus far that has been elusive. In that case, the president , who is a great leader and makes good on his promises will exercise his leadership and all of his executive federal authority. You can count on that. You can take that to the bank. You did note thing say is what you would do with executive powers on state aid. New york state has said if they do not get the aid the austerity begins immediately. You are an economist. You have way more experience than i do on wall street. You know the federal government is the only one that can act counter cyclically. States do not have that benefit. They do not have that option. You also know if they do not get the aid, the austerity starts immediately. What is the federal strategy when the state level austerity kicks in because we cannot find an agreement on state aid . Dir. Kudlow it is hard to say that the care is bill and other bills in the last three to four months is austerity. Ofput out 3. 5 trillion fiscal assistance in many forms. The Federal Reserve has put out over 7 trillion to the money supply and their lending facilities. This is not austerity. Jonathan not from the federal government. I am suggesting the states will have to cut. Dir. Kudlow i will say this. Because of the pandemic contraction, the income statements of state and local governments and the federal government have deteriorated. Absolutely. What is the solution . ,ome of the solution is in aid some of the solution is economic growth, where the revenue will start pouring in and more people go back to work and they pay taxes and so do businesses. States,given the through prior deals, hundreds and hundreds of billions of dollars. I do not want to secondguess. Im not here to negotiate. We are looking at all of these asks from our friends across the aisle. I know the president is especially interested in making sure there are sufficient resources to get the kids back to school. If we apply the guidelines of distancing and masking and testing and good hygiene, the kids can get back to school. If there is covid related expenses, i think there is a chance the president would be happy to pitch in. The bill we have been given from the other team goes way beyond that, and there are a lot of democrat asks that do not make sense, certainly not in the present context. We have to separate that out. It is not so simple to