1
00:00:02,800 --> 00:00:07,119
Speaker 1: Broadcasting live to New York Bloomberg eleventh, Rio to Washington,

2
00:00:07,240 --> 00:00:12,240
Speaker 1: d C. Bloomberg to Boston, Bloomberg twelve hundred to San Francisco,

3
00:00:12,360 --> 00:00:16,320
Speaker 1: Bloomberg nine to the countries es Exdam General one nine

4
00:00:16,720 --> 00:00:20,240
Speaker 1: and around the globe the Bloomberg Radio Plus happened. Bloomberg

5
00:00:20,239 --> 00:00:24,120
Speaker 1: got gone. This is taking Stock. I'm Kathleen Hayes along

6
00:00:24,120 --> 00:00:28,280
Speaker 1: with pim Fox. The payroll pop, that's what they're calling

7
00:00:28,320 --> 00:00:31,560
Speaker 1: it over at Bank of America Merrill Lynch. Enough to

8
00:00:31,560 --> 00:00:36,120
Speaker 1: relieve fed policymakers that the economy is not losing steam

9
00:00:36,159 --> 00:00:39,720
Speaker 1: as that may number may have suggested, but not enough

10
00:00:39,760 --> 00:00:43,680
Speaker 1: to eliminate worries about global downside risk. PIM yes, and

11
00:00:43,760 --> 00:00:46,680
Speaker 1: non farm payrolls rising by a seasonally adjusted two hundred

12
00:00:46,680 --> 00:00:50,199
Speaker 1: and eighty seven thousand in June. That's the strongest month

13
00:00:50,240 --> 00:00:52,760
Speaker 1: of hiring since last October. Right now, let's go to

14
00:00:52,840 --> 00:00:55,600
Speaker 1: Charlie Pellart in Bloomberg whose room for a Bloomberg business flat,

15
00:00:55,760 --> 00:00:58,800
Speaker 1: and thank him, Thank you, Kathleen, all about jobs are

16
00:00:58,880 --> 00:01:02,840
Speaker 1: Coverage continues right here on taking Stock, but markets responding

17
00:01:03,000 --> 00:01:05,679
Speaker 1: best level of the day right now, the now at

18
00:01:05,760 --> 00:01:09,199
Speaker 1: eighteen thousand, one hundred forty nine. It's up two hundred

19
00:01:09,200 --> 00:01:12,200
Speaker 1: fifty three points now again of one point four percent.

20
00:01:12,680 --> 00:01:15,400
Speaker 1: SMP five hundred index up thirty one again also of

21
00:01:15,480 --> 00:01:18,080
Speaker 1: one and a half percent, and has stack ups seventy

22
00:01:18,080 --> 00:01:20,880
Speaker 1: seven points again there of one point six percent. The

23
00:01:20,959 --> 00:01:25,160
Speaker 1: tenure of five thirty seconds yield one point three six percent.

24
00:01:25,760 --> 00:01:28,720
Speaker 1: As you guys mentioned, the Labor Department said employers added

25
00:01:28,720 --> 00:01:31,880
Speaker 1: two hundred eighty seven thousand jobs, far more than the

26
00:01:31,920 --> 00:01:36,000
Speaker 1: economists survey by Bloomberg were expecting. The jobless rate rose

27
00:01:36,080 --> 00:01:39,399
Speaker 1: to four point nine percent as more people entered the

28
00:01:39,560 --> 00:01:44,560
Speaker 1: labor force. Wages did advance less than projected. Bill Gross,

29
00:01:44,640 --> 00:01:47,720
Speaker 1: his fund manager at Janis Capital, He says June's strong

30
00:01:47,840 --> 00:01:51,440
Speaker 1: job report probably won't change the Federal Reserves decision on

31
00:01:51,600 --> 00:01:54,920
Speaker 1: when to raise interest rates. You know, they still have

32
00:01:55,040 --> 00:01:58,480
Speaker 1: Brexit to look into the eyes of the whites of

33
00:01:58,680 --> 00:02:03,040
Speaker 1: the Brexit eye. I guess they have problems with Italian banks,

34
00:02:03,040 --> 00:02:05,440
Speaker 1: so the Fed doesn't, but the uh, the e c

35
00:02:05,600 --> 00:02:08,720
Speaker 1: B and the you do, the problems with the UK

36
00:02:09,480 --> 00:02:14,360
Speaker 1: property mutual funds. Uh. You know, there's a sense of

37
00:02:14,400 --> 00:02:17,920
Speaker 1: illequdity and markets and and the Fed of course is

38
00:02:18,040 --> 00:02:21,720
Speaker 1: very obsessed and concerned with markets, and right now markets

39
00:02:21,760 --> 00:02:24,480
Speaker 1: are with the Dow Industrials up to sixty a gain

40
00:02:24,560 --> 00:02:26,799
Speaker 1: of one and a half percent, Gold down by a

41
00:02:26,880 --> 00:02:29,360
Speaker 1: dollar to thirteen sixty one to drop there of point

42
00:02:29,400 --> 00:02:32,480
Speaker 1: one percent. Crude oil holding about forty five dollars a

43
00:02:32,520 --> 00:02:35,200
Speaker 1: barrel up twenty one cents now forty five thirty six

44
00:02:35,240 --> 00:02:38,560
Speaker 1: on West Texas Intermediate, a gain of point five percent

45
00:02:39,080 --> 00:02:41,480
Speaker 1: to thirty two on Wall Street. Now, let's take a

46
00:02:41,480 --> 00:02:45,280
Speaker 1: look at other news from around the world. Thank you,

47
00:02:45,360 --> 00:02:47,920
Speaker 1: Charlie from the Bloomberg news room. I'm Ramy in a Cento.

48
00:02:48,520 --> 00:02:51,320
Speaker 1: One of the suspected gunmen in an ambush that left

49
00:02:51,320 --> 00:02:55,040
Speaker 1: five Dallas police officers dead has been identified as twenty

50
00:02:55,040 --> 00:02:58,560
Speaker 1: five year old Micah Xavier Johnson. That's according to reporting

51
00:02:58,560 --> 00:03:02,040
Speaker 1: in multiple media outlet. Johnson reportedly served in the Army

52
00:03:02,080 --> 00:03:05,400
Speaker 1: Reserve as a carpentry and masonry specialist. He was killed

53
00:03:05,400 --> 00:03:08,440
Speaker 1: by an explosive strap to a police robot after hours

54
00:03:08,440 --> 00:03:11,800
Speaker 1: of negotiating with police. Three other suspects are being detained

55
00:03:11,800 --> 00:03:15,040
Speaker 1: by police. Texas Attorney General Ken Paxton is calling the

56
00:03:15,080 --> 00:03:18,560
Speaker 1: attack on Dallas police calculated. He told ABC News people

57
00:03:18,560 --> 00:03:21,720
Speaker 1: should be on the lookout for potential copycats. People need

58
00:03:21,760 --> 00:03:25,400
Speaker 1: to be on guard for potential attacks and other places

59
00:03:25,440 --> 00:03:27,720
Speaker 1: and and maybe here, So I think we're definitely on

60
00:03:28,160 --> 00:03:31,919
Speaker 1: a higher alert here and around the state. President Obama

61
00:03:32,000 --> 00:03:36,640
Speaker 1: is in Poland, where he commented on the shootings is

62
00:03:36,680 --> 00:03:40,760
Speaker 1: that there has been a vicious, calculated and despicable attack

63
00:03:41,640 --> 00:03:46,920
Speaker 1: on law enforcement. Police and ballast were on duty during

64
00:03:47,960 --> 00:03:53,680
Speaker 1: doing their jobs keeping people safe during peaceful protests. Mr

65
00:03:53,720 --> 00:03:56,960
Speaker 1: Obama also called last night a wrenching reminder of the

66
00:03:57,000 --> 00:04:01,160
Speaker 1: sacrifices law enforcement officers sometimes have to make. Five officers

67
00:04:01,240 --> 00:04:04,200
Speaker 1: were killed and seven others were wounded. A judge in

68
00:04:04,200 --> 00:04:07,440
Speaker 1: the George Washington Bridge Lane closing case has ruled against

69
00:04:07,480 --> 00:04:10,480
Speaker 1: providing access to Governor Chrissie's cell phone as part of

70
00:04:10,520 --> 00:04:13,680
Speaker 1: pre trial preparation. The U. S. District judge granted a

71
00:04:13,720 --> 00:04:17,000
Speaker 1: motion by the law firm representing Chrissy's office to quash

72
00:04:17,080 --> 00:04:20,680
Speaker 1: a subpoena by former allies Bill Brownie and Bridget Kelly.

73
00:04:20,839 --> 00:04:22,960
Speaker 1: Global News twenty four hours a day, powered by more

74
00:04:22,960 --> 00:04:26,080
Speaker 1: than twenty journalists and analysts in more than one under

75
00:04:26,080 --> 00:04:28,680
Speaker 1: twenty countries from the Bloomberg News Room. I'm Rami in

76
00:04:28,720 --> 00:04:32,200
Speaker 1: a centio Charlie, and we thank you, and again recapping

77
00:04:32,240 --> 00:04:35,440
Speaker 1: down industrials up two hundred sixty one points, a gain

78
00:04:35,520 --> 00:04:38,120
Speaker 1: of one and a half percent, SMP five hundred index

79
00:04:38,160 --> 00:04:41,599
Speaker 1: advancing thirty two points again narr of one and a

80
00:04:41,600 --> 00:04:44,960
Speaker 1: half percent. I'm Charlie Pellett, and that's a bloom Bird

81
00:04:45,000 --> 00:04:49,560
Speaker 1: business flash during listening to taking Stock with pin Box

82
00:04:49,600 --> 00:04:54,120
Speaker 1: at Gatlee Hayes on Bloomberg Radio at tightening job market,

83
00:04:54,279 --> 00:04:57,400
Speaker 1: it's put up with pressure on wage growth as employers

84
00:04:57,440 --> 00:05:00,839
Speaker 1: compete for an ever smaller pool of a A level workers.

85
00:05:00,880 --> 00:05:03,960
Speaker 1: Average hourly earnings for private sector workers rose by a

86
00:05:04,040 --> 00:05:10,280
Speaker 1: modest two cents two cents in June dollars and sixty

87
00:05:10,320 --> 00:05:12,760
Speaker 1: one cent satis of about two and a half percent

88
00:05:12,839 --> 00:05:16,200
Speaker 1: compared to a year earlier, but the wages were up

89
00:05:16,200 --> 00:05:18,719
Speaker 1: two and a half percent compared to matching the fastest

90
00:05:18,720 --> 00:05:21,480
Speaker 1: annual growth rate since July two thousand nine. Here to

91
00:05:21,560 --> 00:05:23,960
Speaker 1: tell us what this means for markets in the economy,

92
00:05:24,000 --> 00:05:27,480
Speaker 1: Ethan Harris, Head of Global Economics, Bank of America, Merrill

93
00:05:27,720 --> 00:05:30,479
Speaker 1: lynch Ethan Harris, thanks for being with us, so I

94
00:05:30,520 --> 00:05:34,440
Speaker 1: give us your impression of the wage growth and what

95
00:05:34,600 --> 00:05:38,720
Speaker 1: that would mean for GDP growth in the United States. Well,

96
00:05:38,760 --> 00:05:41,479
Speaker 1: I think what we're saying now is the beginnings of

97
00:05:41,560 --> 00:05:44,160
Speaker 1: the end of the job recovery. In other words, the

98
00:05:44,200 --> 00:05:46,840
Speaker 1: beginning of a period where workers get a little bit

99
00:05:46,880 --> 00:05:51,039
Speaker 1: of negotiating power, a way to start picking up a bit. Um.

100
00:05:51,080 --> 00:05:53,480
Speaker 1: You know, we've been stuck at two percent wage growth

101
00:05:53,520 --> 00:05:56,200
Speaker 1: for years now. Now we've moved up to about two

102
00:05:56,279 --> 00:05:58,479
Speaker 1: and a half. I think it's going to take a

103
00:05:58,520 --> 00:06:01,839
Speaker 1: couple more years of health jobs to get into more

104
00:06:01,920 --> 00:06:05,440
Speaker 1: normal three and a half percent or so wage games.

105
00:06:05,480 --> 00:06:08,520
Speaker 1: But you know, I think we're finally there at that

106
00:06:08,640 --> 00:06:11,720
Speaker 1: late stage of the cycle where workers get get a

107
00:06:12,120 --> 00:06:17,200
Speaker 1: more balanced relationship with their employers. Um. This is good

108
00:06:17,200 --> 00:06:20,640
Speaker 1: news for the economy. UM. It's telling you that there's

109
00:06:20,920 --> 00:06:24,360
Speaker 1: been a real healing process here. It's taken a long time,

110
00:06:24,480 --> 00:06:28,000
Speaker 1: but UM, you know, FED policy is working. It's just

111
00:06:28,080 --> 00:06:32,640
Speaker 1: working very slowly. So basically, um uh Ethan, when you

112
00:06:32,680 --> 00:06:36,320
Speaker 1: look at the trajectory of jobs growth, it was stronger

113
00:06:36,360 --> 00:06:39,920
Speaker 1: at the end of by a good margin. And that's

114
00:06:39,920 --> 00:06:41,240
Speaker 1: why the FED. One of the reasons when they came

115
00:06:41,279 --> 00:06:44,440
Speaker 1: in looking to high grates four times this year, UM

116
00:06:44,440 --> 00:06:46,720
Speaker 1: by Marcia, was all the market and certainty right, and

117
00:06:46,760 --> 00:06:49,280
Speaker 1: they cut back, but that the pace of job growth

118
00:06:49,360 --> 00:06:52,520
Speaker 1: is also lost momentum. This was not a particularly strong

119
00:06:53,120 --> 00:06:55,080
Speaker 1: it wasn't such a weak quarter for jobs growth, but

120
00:06:55,080 --> 00:06:57,159
Speaker 1: it's one of the least strong we've had in some time.

121
00:06:57,360 --> 00:06:59,920
Speaker 1: How are you sure that there isn't a loss of

122
00:07:00,080 --> 00:07:04,520
Speaker 1: momentum here? That is going to be vulnerable too, As

123
00:07:04,560 --> 00:07:07,840
Speaker 1: you point out in your your note today global downside risk,

124
00:07:07,880 --> 00:07:10,240
Speaker 1: you say that things will be watching that well. I

125
00:07:10,240 --> 00:07:12,160
Speaker 1: think if you look at broadly at the data in

126
00:07:12,200 --> 00:07:15,080
Speaker 1: the last few months, actually there's been a slight pick

127
00:07:15,160 --> 00:07:18,760
Speaker 1: up overall, So I think you're right that payrolls have

128
00:07:18,880 --> 00:07:22,040
Speaker 1: slowed down fundamentally. I mean they're now running it about

129
00:07:22,720 --> 00:07:25,120
Speaker 1: a hundred and fifty thousand a month on average, and

130
00:07:25,120 --> 00:07:27,600
Speaker 1: they were running and well above two hundreds. So there's

131
00:07:27,600 --> 00:07:30,480
Speaker 1: been some loss of momentum there. I don't think that

132
00:07:30,480 --> 00:07:34,280
Speaker 1: that was sustainable to be creating that number of jobs

133
00:07:34,320 --> 00:07:37,960
Speaker 1: in an economy growing two But if you look at

134
00:07:37,960 --> 00:07:41,080
Speaker 1: the rest of the economy, you look at better retail sales,

135
00:07:41,600 --> 00:07:47,720
Speaker 1: better survey measures like the Purchasing manager survey, um overall

136
00:07:47,760 --> 00:07:50,679
Speaker 1: g d P in the second quarter looks like about

137
00:07:50,720 --> 00:07:54,160
Speaker 1: two point six percent growth. So you know, there's a

138
00:07:54,160 --> 00:07:56,720
Speaker 1: little bit of improvement going on in the underlying data,

139
00:07:56,800 --> 00:08:00,480
Speaker 1: even with the labor market slowing down a bit. All right,

140
00:08:00,520 --> 00:08:05,800
Speaker 1: so improvement there. But tell us about the manufacturing sector

141
00:08:05,880 --> 00:08:08,960
Speaker 1: and inventory bills, because it seems as other manufacturing sector

142
00:08:09,000 --> 00:08:12,240
Speaker 1: has been moving in a different direction than the service economy. Yeah,

143
00:08:12,280 --> 00:08:14,600
Speaker 1: I mean we're still feeling the effects I think of

144
00:08:14,720 --> 00:08:18,400
Speaker 1: the strengthen the dollar last year. Um, I mean, this

145
00:08:18,480 --> 00:08:22,119
Speaker 1: is a tough environment for manufacturing. You had very sharp

146
00:08:22,200 --> 00:08:26,040
Speaker 1: move up in the dollar, making us products less competitive globally.

147
00:08:26,480 --> 00:08:28,640
Speaker 1: It was also an environment where you had a collapse

148
00:08:28,720 --> 00:08:32,440
Speaker 1: in the mining sector, which uses a lot of manufactured products.

149
00:08:32,440 --> 00:08:35,960
Speaker 1: So the mind of the manufacturing sector is kind of

150
00:08:36,000 --> 00:08:39,439
Speaker 1: in a very slow motion recession. The rest of the

151
00:08:39,480 --> 00:08:43,000
Speaker 1: economy is doing fine though, and remember manufacturing is only

152
00:08:43,040 --> 00:08:46,000
Speaker 1: a little over ten percent of the economy, so it

153
00:08:46,040 --> 00:08:48,520
Speaker 1: doesn't normally drive the economy, even though it can be

154
00:08:48,600 --> 00:08:55,880
Speaker 1: quite volatile. Even uh, speaking of the feder Reserve, the

155
00:08:55,920 --> 00:08:58,640
Speaker 1: Marcus don't see a rate height the rest of this year.

156
00:08:58,920 --> 00:09:03,920
Speaker 1: And you get this this September on our our w

157
00:09:04,080 --> 00:09:07,680
Speaker 1: I r P page on on the Bloomberg and there's

158
00:09:07,720 --> 00:09:12,040
Speaker 1: still not an implied probability that gets to is the

159
00:09:12,080 --> 00:09:16,479
Speaker 1: market wrong or are we in some kind of stasis

160
00:09:16,559 --> 00:09:19,120
Speaker 1: where yeah, jobs are growing and maybe we just will

161
00:09:19,200 --> 00:09:20,840
Speaker 1: rise a little bit more, but inflation is not going

162
00:09:20,880 --> 00:09:22,640
Speaker 1: to rise much, and the Fed's going to look every

163
00:09:22,640 --> 00:09:25,000
Speaker 1: month and say, dang, we'd like to move right set,

164
00:09:25,040 --> 00:09:28,679
Speaker 1: but we don't, we can't or we don't need to. Yeah, well,

165
00:09:28,679 --> 00:09:30,800
Speaker 1: maybe you need to rename that the r I P.

166
00:09:31,160 --> 00:09:35,840
Speaker 1: Because it seems like the FED is dead. But all right,

167
00:09:35,920 --> 00:09:39,199
Speaker 1: pretty good joke there, right, Um, But I would say

168
00:09:39,240 --> 00:09:43,199
Speaker 1: that the market is slightly under pricing the Fed. I mean,

169
00:09:43,240 --> 00:09:45,440
Speaker 1: we think the Fed by December will be ready to

170
00:09:45,480 --> 00:09:50,400
Speaker 1: do another hike. Um, so you know they'll move. Well,

171
00:09:50,400 --> 00:09:52,280
Speaker 1: that sounds like a big difference from the markets, but

172
00:09:52,320 --> 00:09:55,040
Speaker 1: it's not that big a difference. What's going on right

173
00:09:55,040 --> 00:09:58,160
Speaker 1: now the FED is that they want to be able

174
00:09:58,200 --> 00:10:00,800
Speaker 1: to check all the boxes before they move. They want

175
00:10:00,840 --> 00:10:03,200
Speaker 1: to be able to say the job markets okay, the

176
00:10:03,240 --> 00:10:06,719
Speaker 1: economy is okay, inflation is picking up a bit, and

177
00:10:06,760 --> 00:10:08,959
Speaker 1: they want to be able to say there's no systemic

178
00:10:09,520 --> 00:10:12,960
Speaker 1: problems in the global economy or markets. When they feel

179
00:10:13,000 --> 00:10:17,560
Speaker 1: comfortable with all three of those things, then they move

180
00:10:17,600 --> 00:10:19,880
Speaker 1: ahead and hike interest rates. And that's why I don't

181
00:10:19,880 --> 00:10:21,960
Speaker 1: think they're likely to hike in the next few months,

182
00:10:22,040 --> 00:10:25,760
Speaker 1: because they really wanted some time to kind of get

183
00:10:26,000 --> 00:10:29,319
Speaker 1: get these wounds behind us um. But I do think

184
00:10:29,360 --> 00:10:32,120
Speaker 1: eventually they'll hike again. The bond market. I think, you know,

185
00:10:32,160 --> 00:10:35,360
Speaker 1: it's a little too optimistic about the Fed being completely

186
00:10:35,400 --> 00:10:38,720
Speaker 1: out of the picture. All right, Heathen here, thank you

187
00:10:38,760 --> 00:10:41,199
Speaker 1: so very much for joining us today. Head of b

188
00:10:41,360 --> 00:10:44,600
Speaker 1: of A Maryland Global Economics even says the economy, this

189
00:10:44,640 --> 00:10:47,560
Speaker 1: is a good news report today in jobs, solid footing,

190
00:10:47,679 --> 00:10:50,720
Speaker 1: moving ahead, a little bit, better wages, and he's looking

191
00:10:50,720 --> 00:10:53,440
Speaker 1: for that interest rate increase from the Federal Reserve in December.

192
00:10:54,160 --> 00:11:01,880
Speaker 1: This is taking stock and this is Bloomberg. The Hampton's

193
00:11:01,880 --> 00:11:04,240
Speaker 1: Commuter Minute is brought to you by land Rover. When

194
00:11:04,280 --> 00:11:06,960
Speaker 1: towers seem like trees and roads become rivers, the range

195
00:11:07,040 --> 00:11:08,920
Speaker 1: Rover Evil is there to guide you through the twists

196
00:11:08,960 --> 00:11:11,080
Speaker 1: and turns of the urban jungle. Visit your tri state

197
00:11:11,120 --> 00:11:14,120
Speaker 1: area land Rover retailer for special offers. Land Rover Above

198
00:11:14,200 --> 00:11:14,720
Speaker 1: and Beyond