Stocks and stories making headlines today. Tom keene is in washington today with highlights of an interview with Christine Lagarde. Julie monitors equity markets and oil dipping below. Petergton correspondent cook and a preview of president obamas speech on the economy. Good afternoon. Good afternoon. Speak to Business School students outside chicago in just a few minutes time. Really, this is an opportunity for the president to try to change the conversation back to the u. S. Economy. So much focus on foreignpolicy issues. Airstrikes against syria, even arriving hereat in the United States. The president trying to refocus again american attention on the u. S. Economy. The jobsday away from report, about 30 days away from the midterm elections. A big focus right now for democrats, trying to talk more about the economy. We have heard from some of the president s aides already. A top economist, jason furman, telling me in the last little bit that the president will not offer new policy prescriptions in his speech today. Things he has been trying to do but has not been successful on, higher immigration wage reform. Those kinds of issues. And he will highlight the sinceement in the economy the financial crisis and a chance to reassure americans things can get better but there is more to be done. It is not much of a mystery that people do feel more confidence but their incomes are still lower than they were in the late 1990s according to the sense of numbers. When that is the case, people are frustrated and the solution to that is not any one thing or any two things. Economic agenda the president is pushing. The entire economic agenda the president is pushing. Republicans in control of the house. The reality is is is a tough sell for the president trying to convince americans there are still concerns. The situation with unemployment still at 6. 1 . Americans are still struggling to find jobs. The challenge for the president is to try and change the conversation back to the economy and the white house has more in its toolbox to fix the economy. With the prospect of republicans taking the senate and the midterms, is in the white house looking at gridlock for the economic agenda . You have got to get past election day. I asked jason furman about that. Nothing has been passing in recent months. Democrats in control of the senate. What prospect is there for some of these and and these initiatives . He mentioned specifically tax reform, business tax reform. There is an opportunity, shared ideas that both sides can agree on. So many details stand in the way. Will be a heavy lift. That is one area he mentioned specifically. Peter, stand by. We will speak to you shortly. The former governor is a professor of economics at the university of chicagos school of business and he joins us live. Professor, welcome. Thank you for your time today. Great to be here. President obama is expected to point out the United States is showing more economic progress than other nations. That message not seem to be resonating with americans on main street . True we are showing some progress. I think the reason is the Unemployment Rate is not showing the full amount of stress American Workers are feeling. 6. 1 is not that high. If you look at broader measures of unemployment, jenny allen and the said have been emphasizing, and it includes parttime workers who preferred to be fulltime, and if you include people giving up looking for a job and would really like one, Unemployment Rate is 12 versus 6 . That is a lot of pain. Wages for American Workers are flat, adjusted for inflation, average Hourly Earnings in august were up only 4 10 of 1 from a year earlier. Middleclass income have still not returned to prerecession levels. The question is simple but the answer appears to be complicated. If the economy is doing well, why arent workers getting paid more . I said the labor market is not doing nearly as well as the Unemployment Rate might reflect. If you look at the broader measure, it is 12 and not 6 . If you look at the years before the crisis, that number would be higher than the regular Unemployment Rate but it would only be 9 or 10 , rather than 12 . What we are seeing is firms being unwilling to make the moretments to really build strength in the recovery. Part of that is a lot of economic uncertainty, in particular, policy uncertainty. There continue to be pockets of weakness in the labor market. And how have they convinced the recovery from gaining strong momentum . You have a lot of workers who have found jobs. We hear about roughly 200,000 jobs being created are much. A lot of those are parttime jobs of people who preferred to be working parttime area fulltime. That is positive theyre getting some compensation but not nearly as much as they would like. Another aspect is very low labor force participation. The percentage of people actively looking for work is was in thethan it past. A lot of people feel fairly desperate and are not being included in the 6. 1 unemployment number. Im sticking with the former fed governor, professor of economics at the university of chicagos will business. Last month, you are on Bloomberg Radio and you said a fed of fed policymakers, they are not sure about how the economy will evolve. It is really about the data. If it were not about the data, how else would janet yellen and her colleagues be reaching decisions on Monetary Policy . Is always about the data. Some people have the view that there is a fixed timetable the fed has. They have all those things they put out for where for craft are, but this is really not the case. They really are looking at the data each month and updating. They will respond to the data as it comes in. Lets go overseas for a bit. Mario draghi today announced economic stimulus measures. He said the ecb would keep Interest Rates in the eurozone at record low levels area the bank would also start a new Bond Buying Program to help increase this is aemand area page from Ben Bernankes playbook from a but would the effect of overseas . Effective overseas . They have allowed their Balance Sheets to shrink over the last couple of years. That has been accompanied by slowing growth as well as inflation getting dangerously close to zero or negative territory. Lotso, the ecb has to do a to try to respond to that. In the u. S. , the fed could buy u. S. Treasury securities. In europe, politically and economically, much more challenging. How much debt agreed that greek debt live by relative to spanish jet, french its it dead, french debt ear that is an element the french did not face. Who gets credit for the american improving Economic Data . The reserve . Ma or the fed board . You will have a biased because irom me served on the fed board. I think the fed gets you can credit. The fed tried to prevent inflation outcomes the European Central bank is facing, as well in the japan has faced previous 15 years. That is helpful, but a necessary condition are not sufficient area having good, program fiscal policy, good, progrowth arelatory policy them reducing policy uncertainty, that is something that is very important area i do not think we made enough roberts on that for some of the other actors in washington to get as much as that i would as they would like. Professor of economics joining us from chicago. Professor, thank you so much for your time and perspective here and we appreciate it. Thank you. Days before World Leaders arrived in washington, the imf managing director Christine Lagarde says she worries about the disconnect between sluggish Global Growth and financial markets. She made her remarks in an interview this morning with tom of bloomberg surveillance. In a speech you gave, you said we will not return to the crisis world. Divinations, are they finally catching up with lagarde . I amwas concerned then and still concerned today. I talked this morning about the risk of the new mediocre that we to avoid. How is that is how is that different . What is your distinction of the new mediocre . Exit has three components him a few well. One is that it still has the legacy of the crisis very high index crisis. In debt. Ndex then we are facing serious clouds on the horizon. A lot of uncertainty. If you combine the legacies, and the uncertainty, we have a rising of a new mediocre, where we are revising potential growth. The urgency i heard in your speech is almost on a calculus basis, a first and second derivative. And immediacy we saw and the stock market yesterday. I saw it mostly in the running modity price debt crisis commodity prices. How concerned are you about what the markets are telling them about the new mediocre . Leslie the markets with a concern and a lot of hesitation. There is clearly a discrepancy between the points of the markets in many ways. Points of the markets, asset values at the highest ever, volatility is very compressed and low. And the other end, we see a real economy where the recovery is not really strong and we the of fragile recovery. There is a discrepancy between the two. It is quite worrying. How the market reacted to his nonnews. Someone besides yellen. Rest of them i totally agree with you that these ladies and gentleman you mentioned have done their best. It cannot be alone. Pace and mixight of fiscal measures in those countries that refused to stop public finance. We need serious Structural Reforms in place to unleash the potential economies have. Our recommendation, in order to shortterm demand issue, as well as the improvement in the mediumterm investment in infrastructure, needed across the world. I like how you parse that about infrastructure. We have not seen that in the united. You were critical of the United States a year ago in new york. Your your criticism criticism away from these meetings . The u. S. Is doing better. Do you give the United States a victory lap . Lets it is clearly one of the bright spots. Vast economies, the u. S. Pops out in a much better condition and the u. K. Does as well. Clearly, on the investment and infrastructure front, more needs to be done. The imf managing director, Christine Lagarde, speaking with tom keene this morning in washington. You are looking at a live pitcher from Northwestern University, the order the in illinois. President obama discussing the economy, live on bloomberg television. We cant help but visit a campus like this but feel the promise of the future. That is lacking here. It will be young people like you thatniversities like this will shape the American Economy and set the conditions for middleclass growth well into the 21st century. Obviously, recent months have seen their fair share of turmoil around the globe. But one thing should be crystal clear. American leadership is the one constant in an uncertain world. It is america, our troops, our diplomats, that lead the fight to degrade and ultimately destroy the terrorist group known as isis. It is america, our doctors, scientists, knowhow, that lead the fight to contain to combat the evil eye epidemic the a eboli epidemic. We attract so many people to our shores, the studies of businesses, and tackle some of the most challenging problems in the world. Alarms go off somewhere in the world, whether it is a disaster that is natural or manmade, when there is an idea or invention that could make a difference, this is where things start. This is who the world calls here in america. They do not call moscow or beijing. They call us. We welcome that responsibility of leadership because that is who we are. That is what we expect of ourselves. But, what supports our leadership role in the world is ultimately the strength of our economy here at home. Today, i want to step back from the russian global events to take a clear eyed look at our economy. Its successes, and its shortcomings. And determine what we still need to build for your generation, what you can help us build. As americans, we can and should be proud of the progress our country has made over the past years. Here are the facts. And imes, noise clutters think confuses the nature of reality out there. When i took office, businesses were laying off 800,000 americans among. Our businesses are hiring 200,000 americans a month. [applause] the Unemployment Rate has come down from a high of 10 in 2009 26. 1 today. [applause]. 1 today. [applause] our businesses have created 10 million new jobs, the longest, uninterrupted stretch of rival sector job creation in our history. Inc. About it. Applaud,t have to because i will give you a lot of good statistics. [laughter] right now, there are more job openings than at any time since 2001. States hashe united put more people back to work than europe, japan, and every other advanced economy combined. I want you to think about that. We have put more people back to thanhere in america europe, japan, and every other advanced economy combined. Has in hard, but it has been steady and real. It is a direct result of the American Peoples drive and their determination and resilience, but also the result of decisions made by my ministration. It is indisputable, our economy is stronger today than when i took office there at by every economic measure, we are better off now than we were when i took office. Time, it is indisputable that millions of americans do not yet feel enough of the benefits of a growing economy where it matters most. That is in their own lives. These truths are not incompatible. Our broader economy in the aggregate has come a long way. Of recovery are not yet broadly shared. At least not broadly shared enough. We can see that homes american unities are selling for more money in the stock market has doubled and maybe the neighbors had new health care or a car fresh off an American Assembly line and these are all good things. But the stress that families feel, that is real as well. It is still harder than it should be to pay the bills and whenway some money, even you are working your tail off, it is harder than it should he to get ahead. This is not just a hangover from the great recession. I have always said that recovering from the crisis in 2008 was our first order of his nest. Our economyaid would not be truly healthy until we reverse the longer and profound erosion of middleclass jobs and incomes. Here is our challenge. We are creating more jobs at a eddie paste. We have got a recovering housing sector,a manufacturing two things that are critical to middleclass success. We have also begun to see modest wage growth in months. All of that has gone the economy rolling again, despite the fact the economies of many other countries around the world are softening. But as americans, we measure our success by something more than our gdp or a jobs report. Measure it by whether our jobs provide meaningful work, we give people a sense of purpose, and whether it allows folks to take care of their families. Too many families still work too many hours with too little to show for it. Job growth could be so much faster and wages could be going up faster if we made better decisions Going Forward with the help of congress. Our task is to now harness the momentum that is real, that does west, and make sure accelerate that momentum, that the economy grows and jobs and wages grow. That is our challenge. Family is notal bringing home any more than it that means it is harder for middleclass americans to climb the ladder of success. It means it is harder for poor americans to grab hold of the latter into middleclass. Ladder into the middleclass. That is not what were about. If being american means anything, it means we believe even if we obviously a little bit of a technical hit there as the president was making his comments at Northwestern University in illinois. I understand we have the feed back to the president at northwestern. And then come. Kids can as well. That is about more than just fairness. It is more than just the ideal of what americas is about. When middleclass families cannot afford the services and goods our businesses sell, and makes it harder for our economy to grow. Our economy cannot truly succeed if we are stuck in a winner take all system where a shrinking few do very well where a growing many are struggling to get by. Historically, our economic greatness rests on a principle, when the middleclass fries and people work hard to get into the middleclass, then america thrives. When it does not, america does not. Be a central to talent challenge of our time. You have to make it work for everyone in america. Every policy i pursue as president is aimed at answering that challenge. Over the last decade, we learned the hard way it was not as it was not sustainable to have an economy where too much of the in home prices, bubbles burst, and a casino mentality on wall street, where the reckless as of a few could threaten all of us, where income at the top skyrocketed. That was not a formula for sustainable growth. We need economy that is old on a rock that is durable competitive. Of good, steady source middleclass jobs. When that is happening, everybody does well. That is land day one, when i with dick durbin and others who were working with us, i said we would rebuild our economy on a new foundation for or for growth and economy. We have been laying the cornerstones of this foundation. Iry single day since mentioned earlier that there is not an economic measure by which we are not better off when we took office. Let me break down what we have been doing structurally to make sure we have a Strong Foundation for growth Going Forward. The first cornerstone is new investments in energy and technology that make america a magnet for good, middleclass jobs. Right off the bat come as soon as i came into office, we upped our investment in American Energy to strengthen our own ene