Obama and Putin Faceoff at G-20: Surveillance (9/6)

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Sept. 6 (Bloomberg) -- Full episode of "Bloomberg Surveillance." Guests: Barclays Geopolitical Strategist Helima Croft, Harris Associates Chief Investment Officer David Herro, Creative Consultants AndrewAndrew, Former World Bank President Robert Zoellick, EY Americas Managing Partner Steve Howe, Manpower Chairman & CEO Jeff Joerres and Bloomberg’s Paul Sweeney. (Source: Bloomberg)

The two presidents london st.

Petersburg, obama and the putin.

They are one serious up part.

Content is king -- cbs and time warner cable got it done now it is yes pm/disney who wants dish to pay up.

Madrid and tokyo via for the olympics.

Good morning everyone, this is " bloomberg surveillance." it is friday, september 6. joining me as always, scarlet fu, and our economic editor, michael mckee is in for sara eisen.

It is all jobs day and it is very exciting.

You are in a good mood because of it.

There was a baseball game last night, two.

There was, it is a lovely time in the easternunited states.

Red sox-yankees.

Time for our morning news.

The french are supposed to be the most miserable people in the world but consumer confidence is rising for a second month in august.

European bond yields are falling today.

We will see how u.s. bond yields react when we get the jobs report at eight or eam 130 -- at 8 a.m. -- 8:30 a.m. we are watching the takeover of smith field foods.

The president is in st.

Peter's berg trying to practice his dale carnegie moves.

Real drama.

You were with orbit job and reagan.

This is like that.

This is a little like that and the stakes are lower but the difficulty is higher.

Very interesting.

We will go to hans nichols and a moment but let's do a data check.

Commodities are flat and quiet.

I will come back to the 10-year in a moment.

German industrial production is a little light.

Nymex is $107. a mix within equities, bonds, and currencies.

Higher yields, risk on, the old gets hammered over the last few days.

We miss sara eisen.

Help me out, this is something as you go back to june, 2007. this is the 10-year yield.

A heart the above three percent.

What is the significance?

It's more psychological than anything else.

It shows the economy is either normalizing or the fed is losing control how the markets interpret that.

Let's get to the front page.

We scour the papers.

Jp morgan is ending its student loan business which will take effect october 12. wells fargo would remain the only major u.s. banks making student loans.

President obama said the federal government would be more active making loans students.

Private lenders share of this one dollars trillion market has fallen seven percent.

This is like a changing landscape.

They feel they cannot make money with the government getting in and congress capping student loan rates.

Why would you want to?

Is is really messed up.

That is safe to say.

That is what has happened with banks overall.

Our second front-page story is a lot of space on the idea that ford is making a bold sale when car sales reach 17 billion after august domestic sales top annualized rate of 16 million pre-crisis levels.

Alan mullally is pointing to pent-up demand.

He spoke to bloomberg earlier about production demand.

We are sizing our production to the real demand and would believe the actions we have taken do that.

We follow the same model in the united states and around the world which allows us to produce the vehicles and the quantities people really want.

We think we are the right size for now but we will continue to watch this carefully.

He also told bloomberg he plans to stay on as president and ceo of ford until the end of 2014. there was speculation maybe he would take over microsoft.

Would he be a shock at microsoft?

It might not be a good cultural thing.

Maybe not.

Our third cover story is president obama will likely wait to announce his nominee for the federal reserve chairman until after the serious issue is resolved and congress votes on military action.

Obama has not yet decided who we -- who he will nominate.

They are holding off on some kind of decision.

Now is when the debate should start.

They have to get it started because they have to get someone confirmed by the time ben bernanke leaves at the end of january and congress only has a few days left in session before the end of the year.

They have to deal with the budget crisis and the fiscal cliff.

They don't have a lot of time to do this.

" the wall street journal " says that they will oppose the nomination of larry summers.

This makes for really interesting fed betting, almost betting.

It is like a horse race.

There was uncomfortable body language at the g-20 language between president obama and russian resident vladimir putin.

Hans nichols is there.

How bad was the frostbite as you stood by the two presidents?

There was no fraud because there was so much friction from the palace behind me, so much disagreement it actually warmed us up.

I have covered a number of these summits and this one is remarkable because all of the friction, all of the conflict is out in the open.

It is about syria and quantitative easing and it is remarkable that it is this far out and the u.s. wants to get it out more in the open.

White house officials want a roll call on the 20 nations that are here and find out if they are with them or against them on syria.

It is quite remarkable.

Is there someone in the middle trying to broker some sort of detente between the two presidents?

Not that we know of.

No one has emerged as a go- between in part because the camps are so far apart.

. you have russia and china on one side, clearly arguing for the un and you have the u.s., france, and the uk on the other side.

If there is a go between country, look at the prime minister of italy.

He seems to be straddling both sides the most.

They had a dinner late last night.

We are trying to get a better read on it and the disagreements were pretty obvious and quite intense.

We are trying to get a sense of whether there is anyone back and forth between the two camps.

When does the president returned to the united states?

He gets back late friday evening your time and wrap things up with a press conference here and we will have dueling press conferences.

Everyone will give their view of it and we will be able to sort through the rubble and see how bad and how disastrous summit was for obama in an attempt to get international support for a military strike in syria.

Thank you so much.

Let's introduce our guest host for the hour, halima cro ft, formerly with the cia.

With the g-20 split over what to do it syria, there are reports that the syrian initiative and initiative is being driven by interests in oil and gas pipelines.

I think it is a great game for the middle east.

This is where they have a middle east post.

Russia does not want to use -- loose strategic influence.

I don't think it is about natural resources.

What is the u.s. stake?

President obama has laid down the clear red line so is about u.s. credibility.

When you look at this, you were the outlier, no but i believes you -- grimace a crystal ball of where we will be in two years or five years -- give us a crystal ball of where we will be in two or five years.

You want to watch the scale of the intervention if we get one.

It might involve b-52 bombers.

If it's a short and limited strike, you are looking at potentially this dragging on like lebanon.

It could drag on for years as a de-stabilizing force in the middle east.

When you hear of a limited effort by the united states, you are skeptical?

Potentially, it is stalemate.

In some respects, that serves in and just because there are concerns about the rebel forces.

There are reports of extremists in the rebel ranks.

It is a tough choice for the administration.

It the best case scenario is a stalemate that lasts for a long time, what does that do to oil prices?

The oil market will be looking at this affecting any neighboring oil producers.

Syria does not produce that much oil.

You want to look at iraq and the iraq security situation has gotten worse.

A lot to talk about on the strategic future for the middle east.

Let's go to strategic company news.

Another win for shareholder activist -- the company had opposed a move belt just -- backed by ken whitworth.

New charges of poor working conditions at one of the apple iphone suppliers.

In china, workers work the maximum hours and some were forced to work overtime.

Apple is investigating the allegations.

Nelson is working with the ftc to win approval of its arbitron deal for the company is negotiating concessions with regulators over how to license its rating technology.

An agreement could clear the way for nielsen's buyout of arbitron.

I wished i could have stayed up for the opening game for the nfl football season.

Peyton manning threw seven touchdown passes to lead the denver broncos to a 47-21 win.

He is the sixth letter to toss that money touchdowns.

It has not been done in 44 years.

They rallied in the second half.

Who was the last cornerback to do that?

Y,.a tittle., what does y.a. stand for?

Very good.

With this is our guest host, paul sweeney of bloomberg industries giving us perspective on the media stocks.

Who is the denver broncos of the media?

I think it's going to be espn and cbs, all the partners for the nfl.

This is their time of year and the programming that will produce a record year.

Live programming is what it's all about and sports is number one and the number one sport is nfl.

Not baseball.

In terms of the viewers and the advertising, it is the nfl.

We are looking forward to a trip -- to a terrific show.

We want to get your thoughts on what is going on in the re- transmission battle.

Disney will have a showdown with espn over dish networks next on " bloomberg surveillance congo streaming on your phone, your tablet, and bloomberg.com.

? good morning, everyone.

Charlie rose tonight at eight and 10 p.m., a conversation with james gorman of morgan stanley.

That is a company in change in an industry that is changing.

That is tonight.

This is " bloomberg surveillance." michael mckee is in for sara eisen.

Content is a cliche -- it is king but it is also true?

It has been true days proven true especially between the deal struck between cbs and time warner cable.

Disney versus dish is the next showdown.

They have a contract that expires september 30 and this matters because disney owns espn and espn is the must-have channel for pay-tv providers.

They currently charge five dollars 50 four cents per subscriber which is the most expensive basic a bit -- they currently charge $5.50 per served scriver which is the most expensive basic cable channel.

That's part of the business model.

What happened with cbs-time warner channel is a significant for disney.

There was a significant price increase and also they held onto digital rights.

Charlie ergon is the chairman of dish networks and he is -- has been willing to talk about not paying for sports rights.

I think he needs them more than he needs them.

What is the thing i need to know about the media wars?

You started off your segment with content is king and we see it time and time again.

The more just tradition platforms there are in terms of broadcast, cable television, hulu, amazon -- these are all entities that are bidding for content.

If you are sitting in hollywood with your cable networks and studio output, you are in a very good position.

Is brian robertson in the best physician for distribution at comcast?

He spent $20 billion of the last couple of years buying nbc- universal to get the cable tv networks and the studio and get content.

It is not just a pipeline.

He actually has the content.

Contrast that with dish because it is just a pipeline.

They don't really supply broadband services.

That's exactly right.

Charlie ergen told his investors that his business is a dying business.

That's why he has to get into the wireless business and that's why he spent audience of dollars buying wireless spectrum.

He has thrown in the towel on his core business.

You say the dish on the roof is dead?

It is dead in the u.s. because there are so many ways to get content.

It is a good cash flow business but they are losing subscribers.

Is cable going to go away?

Will we only watch on the internet?

I don't think the near future.

The cable companies don't call themselves cable tv companies anymore.

They are broadband companies.

They are bringing high-speed internet into your home, that is their growth as ms.

And most profitable.

Their core video business is slowly dying but the broadband business is growing nicely.

The due date is september 30 for the current contract to expire.

We have more coming up.

Here is a number for you -- $14 billion, athens spent $14 billion hosting the olympics and coming up, the economics of hosting the summer games erie it many cities are vying for their shot in 2020. ? good jobs day, it is " bloomberg surveillance." we will go but need the headline data on this jobs day.

Michael mckee is in for sara eisen and scarlet fu is here as well.

I think we need some jobs day information.

This is not related to jobs but your computer.

The nsa has been able to decipher detected information.

The story is based on documents leaked by edward snowden.

The pentagon will not need any additional funds for a military strike on syria because the weapon systems they will use are already in the inventory.

Defense analyst estimate the cost of a strike about $300 million or $1 billion.

Those are your top headlines.

Very good, it is a jobs day, though, a lot going on at 8:30 a.m. and then we go on into september.

I have my morning must-read -- he talks about how common courses are vital.

I think it is more a cultural thing.

People need to push the idea that families are responsible that education is important.

Harvey miller was with us yesterday, the bankruptcy attorney, making clear that he agrees but liberal arts matters as well.

I will turn back to syria.

An interesting piece by timothy egqan - i used to travel a lot for bloomberg years ago.

It was a joy.

I am in the war museum in london and there is the map where lawrence of arabia took a black marker like in the movie as they made syria.

How messed up was it when they made the borders that are serious today?

Everyone talks about that in terms of colonialism and countries are struggling to deal with that.

As we talk about imperialism, we are at a great point in the middle east.

It is a great game between countries like saudi arabia.

I think it is and iraq played a big part of that.

I think it is playing out as a multi-nation war.

With the g-20 meetings in st.

Bernard -- in st.

Petersburg, we will continue this discussion.

We will talk about economics and hosting the olympic send the return on this investment.

? good morning, everyone.

Our twitter question of the day -- it is" bloomberg surveillance, co.

On bloomberg television, streaming on your phone, your tablet, and bloomberg.com.

Scarlet fu and michael mckee are with me.

You have a data check.

The question seems to be how long can you hold your breath because nothing is happening.

Everybody is waiting for the job numbers.

The s&p futures, you need a microscope to see how much they have moved.

The 10-year crossed three percent overnight but it is now back down and everyone is waiting to see what happens today and the same with the euro and the dollar.

One currency traders said they are waiting as well.

Crude oil has a little bit of a serious affect.

Do people getting to bet on 8:30 a.m.? they are, they are positioned and that's why you get wild swings after the number.

It is like what he money on a roulette number.

-- it is like putting money on a roulette number.

How about jcpenney which gained yesterday, up 5.3%? this was after glenview capital management raised a stake in jcpenney and is now the biggest shareholder on a bet that jcpenney will recover.

This has been a losing bet for others.

It has had a fairly decent week.

Newmount mining was cut to equal weight from overweight at barclays.

I love bearishness over these mining companies -- a lot of bearishness over these mining companies.

Ok, yankees -- red sox that is the focus in new york city and across greater red sox nation.

Elsewhere, it is the quadrennial soleus known as the next city to host the olympics.

Our economics correspondent, michael mckee, turns his attention to istanbul, madrid, and tokyo.

A decision on saturday -- why would any of these cities want to spend this kind of money and lose it?

No one has ever really made money.

It is a pretty easy question to answer.

Each of the city is committed to spending billions on the games, between two and $4 billion each to stage the games.

A leave out the cost of building all the facilities.

Those are billions more.

"structure, highways -- the infrastructure, highways and to satisfy the olympic committee, they have to improve their facilities to olympic specifications and they have to pay for security.

London alone was $1 billion for security and got a guaranteed 40 million hotel rooms and paid money to make sure air and water pollution standards are up.

Who is out front?

The oddsmakers are putting tokyo ahead.

Each of the cities has advantages and disadvantages.

Istanbul is the exotic favorite because it would be the first one that would straddle two continents and be the first one held in a muslim nation.

Security is a concern there and they had demonstrations earlier and you look at the border -- it is a long border with turkey.

There is some concern there and people think that maybe tokyo would be a good fallback.

They also had the nuclear disaster not too long ago.

That counts against them.

You cannot go to south korea.

They built a lot of the facilities in madrid at maybe by 2020, they are coming out of an economic crisis.

Paul sweeney is with us on the media and halima croft of barclays.

I love the idea of the first muslim olympics.

I think it would be fantastic in terms of promoting turkey.

Turkey claims leadership in the arab spring promoting the democratic -- muslim model.

It has taken some hits after what has happened in egypt.

This would be a great to put the turkish brands out there.

There is that music in our heads.

Nbc makes money.

It depends on where they hold the games.

If they are in a times unfriendly to the u.s., they make more more money but if they go to tokyo -- if you are any of the broadcast partners for the olympics, you love to have it in a market where you can tap into the u.s. advertising.

The asian games presents a challenge.

Sydney, australia was terrible.

That was tough.

If it was up to the nbc executives, it would be in los angeles every four years.

It is all about helping nbc promote all their properties.

It is great programming every four years and it is something they have held onto.

How long has it been?

We associate the olympics with nbc.

It is coming up for bid.

Other partners are thinking of getting into the olympics.

It has always been nbc.

It has been their marquee sports event even when they lost nfl football.

I think you will start seeing some other broadcast partners look at it.

I think fox will be more aggressive.

They need a lot of channels.

Nbc can play all kinds of sports of the same time because they have so many different channels.

That's right, what you see from the international olympic committee, they want every event shown all the time live a possible.

If you sit back, you've got these cable channels, you can put a lot of programs on.

At the time new york city was potentially looking to host the olympics and new yorkers were big it was a -- were thinking it was a big pain, when a city like his temple potentially wins the olympics, they want to be doing this?

I think it would be fantastic for turkey.

It is about the turkish brands and promoting a place for investment.

I think it would rally the country.

They are the least known but the economic study shows it does not have a boost to tourism because everybody saves to go those two weeks and they don't go earlier or later so it evens out.

Why are there note u.s. cities in this horse race?

Atlanta lost 2 billion dollars total.

Sydney lost almost five.

Athens lost between 15-nerdy $2 billion on the olympics.

It is not a moneymaker.

You just sold me.

This is wonderful.

Will we see this tomorrow?

This is st.

Petersburg, the leaders of the g-20 nations are are getting ready for their photo shoot.

It is a little bit awkward this time because we know that putin and hope, met for maybe 15 seconds and said they got along.

They have to choose their spots carefully area they have to stand there while the cameraman gets ready.

There is some distance between a couple of leaders.

It is divided.

It is like a family reunion.

All kinds of awkwardness.

I don't see vladimir putin standing next to obama.

There is franc½ois holland.

We will be covering this and have much more.

Here comes dr.

Phil.

It's david cameron of the united kingdom.

The g-20 gathering for their 2013 class photo as they wrap up in st.

Petersburg.

We'll see if anybody does rabbit ears.

Did ronald reagan and miguel herbage of get along -- mikhail gorbachev get along?

They did.

In the next hour, andrew andrew will join us.

This is " bloomberg surveillance, co.

Streaming on your phone, your tablet, and bloomberg.com.

? good morning, everyone.

It is jobs day.

Michael mckee and scarlet fu is with us.

Iran is plotting revenge of the u.s. strikes syria.

The u.s. is intercepted an order from iran to militants in syria to attack the american embassy and other locations in bag dad.

The japanese fishermen have rejected a plan to release contaminated water from the fukushima nuclear plant into the ocean.

The atomic regulator said releasing the water may be necessary, part of the cleanup of the crippled nuclear plant that the union of fisheries as any release of contaminated water would be unacceptable.

In sports, peyton manning opens the nfl season in record fashion.

He threw seven touchdown passes.

However, he is the sixth player in league history to throw seven passes and i said the last one wasy.a.a tittle but joe cap was the last one.

Elway or manning, who is better?

That's like choosing between michelangelo and picasso.

Michael mckee is with us.

Let's get to our single best job day chart.

This is put together by our star reducer.

-- producer.

This shows a change in percentage terms and part-time workers which is the white line.

And full-time workers which is the yellow line since 2007. full-time workers fell and then recovered but they are still four percent below the 2007 level but part-time workers rose during the recession and recovery and there are 12% more of them.

One in five u.s. workers today are part-time.

I hear this from every single economist that i part- time job can be equivalent to a full-time job.

Do you buy that?

No, full-time workers fell and then not in terms of income which really matters.

However, talking to ubs, they said we make too much of this because we are getting these people back into the workforce.

It is a way to get started at least.

Paul sweeney is with us from bloomberg industries.

Is part-time america in the future for corporations?

I don't think so, do earnings have been good over the last several quarters and if the economy stays here, i think profits are pretty solid.

Goldman sachs said small business job creation is a fiction, it is about others like big companies.

Does small business create jobs?

Absolutely, we have seen this over many cycles.

It is a combination of the large corporations which have been bleeding jobs and we need to see that subside but small businesses is the source of growth.

The jobs report is at 8:30 a.m. this morning.

Betty liu will be here on bloomberg television and i will be looking at wages and wage growth or lack thereof.

See as we await the jobs report, let's take a first look at some photos making news today.

At the g-20 summit, there have been tense discussions on syria but the leaders were treated to a lavish water, music, and fireworks show at the palace.

Let's go to the netherlands where the dutch artist and his team put the finishing touches on a massive statue of an aardvark laying on its back.

This is 100 feet long as a gift from the royal burgers zoo.

It looks like a dragon.

It makes me speechless.

You might know about the artist because he had the world famous robert.

Floating in the harbor of -- he had the world famous rubber duck floating in the harbor of japan.

It toward 13 cities and is 50 feet tall and has landed in beijing yard and expo park and will swim to the summer palace in a few weeks.

This is art.

We need ernie there, too.

Let's change gears -- we want to get back to the news at hand.

Coming up, behind the violence in syria is a contest between nations for strategic power.

Who is taking what side and why?

This is " bloomberg surveillance tom cho on ," streaming on your phone, your tablet, and bloomberg.com.

? this is " bloomberg surveillance, come --," walt disney is facing a september 30 deadline to reach a new deal with dish network to carry its programming.

The talks cover many of us images that led to the time warner cable pulling the plug on cbs in some markets and that standup was settled after a month-long.

Disney owns the most expensive a tv channel, espn.

It is a must-have for cable and satellite broadcasters.

Nielsen is working with the ftc to get approval of its arbitron deal.

It is trying to formulate concessions.

An agreement could clear the way for their proposed $1.25 billion buyout of arbitron.

Apple is close to an agreement to offer the iphone through japan's largest mobile carrier.

It could be offered later this year.

A deal with them would leave china mobile as the last major asian carrier that apple does not have an agreement with.

That is today's company news.

Next tuesday is the apple announcement, september 10? yes, but there is talk that apple is working on something bigger.

Usually, it only has one version of every product.

Now there is talk that apple is working on a bigger iphone, maybe a six inch screen.

More than one?

They are saying perhaps there will be more because you have talk of a lower end.

Samsung has a whole range of prizes -- sizes.

It is something bloomberg industries covers.

Paul sweeney is with us, director of u.s. research for bloomberg industries.

You must have many people looking at this.

How critical is international expansion to apple?

I think it is critical for a lot of the technology of hardware and software players.

They are trying to figure out how to tap into the growing middle class of the chinese consumer.

When you think about a ubiquitous wireless device such as a smart phone, all the operators are thinking about how to get into that market place and they know they have to segment the market a little bit is what apple is trying to do.

Samsung is doing well.

Everyone was carrying a samsung device and my younger nieces and nephews were saying that they could not go back to an iphone after seeing the bigger screen.

A wireless analyst has faulted apple for not thinking about the screen size.

That is something samsung has seized the market momentum a little that with their different product lines.

We will be keeping an eye on september 10 because that is the day of the new product launch and we will make sure that paul sweeney joins us with more on that.

Let's switch gears and get to the news of the day.

Behind the debate over samsung is doing well.

Everyone was carrying a military strike on syria, there is a battle among major powers over strategic control in the middle east.

On one side, you got iran, has below, and russia, long-time allies of syria and on the other hand, saudi arabia,qatar, and the u.s. what we have seen in the last couple of days and weeks is the various tactics within the strategic interests of the middle east.

Helima croft is perfect for this from princeton and her work at the cia and now barclays.

How distant is riyadh from tehran?

They both claim leadership in the middle east.

They say they stand up against went through just western interference in the saudi's were the custodians of the holy mosque.

Iranians say you accommodate to the saudi's. the cultural aspect here has not been discussed.

I guess the turks are arabs, persians i guess are arabs thomas and the saudi's say they are arabs.

That is the fact that they are not sunnis.

Both claim leadership in the middle east.

They say they stand up against wentthey say they are arabs.

The turks are not arabs so why are they trying to assert leadership.

It is playing out in syria but also egypt.

This is a legacy of the colonial orders and what it comes down to is sunni vs shia.

Can they bridge their differences?

You always hope we will get some type of accommodation so we don't get these conflicts but it is a legacy of the iraq war.

That was something that started this up again in earnest.

You have the saudi's and their allies and it was flipped to being a shia country in iraq.

Since 2003, this is played out as a real rivalry.

That the president speak prematurely when he discussed the red line in syria?

Some people say he may have spoken too early when he said assad must go.

People thought we would do what we did in libya.

But it has been this horrible protracted civil war.

Is there any way the u.s. comes out better off at the end of this?

If they don't use chemical weapons again, maybe you have reestablished the red line and credibility on this issue.

If it gets worse, it will just generate terrible headlines for everybody.

It is september, 2013 -- you have one of the calls of the year.

You were very lonely in january, looking for high-level -- higher oil prices.

You amended that but you were early and right on oil.

Why will oil rises sustain higher?

We are discussing syria but the egg issue in the oil market is libya.

We are down to 150,000 barrels of libyan output and they have a capacity of 1.6 million barrels.

If we don't get them back on the market, the market will be tight.

Saudi arabia is producing 10.5 million barrels.

That is the highest ever for saudi arabia.

They are eating into spare opacity and the market is tight.

Asked why we are concerned.

-- that is why we are concerned.

Brilliant, thank you.

Paul sweeney, thank you so much.

Let's do the fourex report.

You can see the ruble, the president has to exchanges rubles as he comes back to the united states, mr.

President it will get you.

There is the rupee, the indian rupee, doing better.

Sterling is $1.55. sterling is having a pretty good week.

Those are pretty good indicators economically in the uk u.s. stocks are headed for the biggest weekly gain in months.

How do you invest in these markets with the critical jobs report at 8:30 a.m.? ? this is "bloomberg surveillance." obama and putin are a serious up part.

It is job state.

We speak with a company planning to hire 10,000 next year.

33% of their professionals from linkedin.

It is a digital new york fashion week.

Andrew andrew is trained routing -- trend spotting.

Good morning everyone, this is "bloomberg surveillance . i'm tom keene, we are live from our headquarters in new york.

It is job state, september 6. joining us as always, scarlet fu . michael mckee is in for sara eisen.

Our guest hosts h is davidarro.

He has a single best track record in international investing.

Give us the jobs stay briefly, if you would serve.

Let us start with some croissant.

Rising for the second month in august, another positive side for europe.

Yields are down in europe right now.

We will see how yields to in the united states at 8:30 this morning when we get the jobs report.

180,000 jobs are forecast to have been created in august third in the event calendar we are looking at earnings from smithfield foods.

The chinese want to buy them.

The other big story of the day is the president in st.

Petersburg.

Trying to win friends and influence people and try to drum up support for an attack on syria.

Let's go to scarlet fu with a job stay company news.

Let's talk about jpmorgan getting out of the student loans business.

Last year jpmorgan stopped making loans to noncustomers.

Just the latest big bang to leave the student loan business since the government expanded its lending.

Wells fargo is the last major u.s. bank still making u.s. loans -- still making student loans.

Foretells a auto -- foretells "the new york times" that it's forecast is positive.

The ceo alan mullally provided the forecast in that report.

Workers at a facility in china worked more than the maximum hours allowed by apple, some of them even forced to work overtime.

Apple is investigating these allegations.

And that is today's company news.

Speaking of investors, whether one person should hold both positions of chairman and chief executive officer.

It is one of the enduring debates of the postcrisis era.

Charlie rose sat down with morgan stanley ceo james gorman.

Here is gorman on the ceo role.

Can you run when an organization is very talented and tom i think it is very important to have that centering of control with one caveat.

You better have a strong board and you better have a great the director.

That is classic james gorman fired up.

You can read the entire interview tonight.

Charlie rose with james gorman.

Erik schatzker is with us.

You know him from "market makers." he will pick up the debris of job stay.

What is the james gorman distinction.

I think the gorman error in your world is the least known of these guys.

What is the gorman distinction between what we know together, blank fine?

I would say gorman is becoming better known because he is making a name for himself as a different kind of ceo.

What is the distinction for james gorman?

Look, he can be brash, a brash australian now and then.

At one point in his career he certainly had a temper.

It is moderated somewhat as he settled into the ceo's role.

What makes them different is that he is not a traitor, right?

-- he is not a trader.

When dominic barton was here recently, i was talking to another guy who worked for mckinsey, james gorman was a manager and director of that firm.

David, you look at companies companies, companies.

How important is that corman energy when you look at a ceo?

That sets the pace.

That sets the culture and how the entire company is going to behave over time.

You really need a leader that can set that tone of the business.

Not just through word, but through example.

I think employees really looked to someone for that.

Does gorman need to be the chairman and the ceo to address a question that charlie rose posed to him.

Different bank, different worlds, it is europe.

In europe the chairman and particularly the chairman of credit suisse is a partial individual.

No question rated dougan is the ceo, brady dugan is charting the strategy, but there is another man behind him.

On the issue of chairman and ceo i think it is important to recognize that the chairman's job is to represent the shareholders.

Those are the owners representative.

Then you have so many runs a business.

That is the ceo.

I think there was a commission many years ago that examined corporate governance.

This is the distinction that you should have someone who is responsible for the board of directors, the chairman who represents the shareholders interest.

We pay them way too much.

How did that change the way you look at financial companies as investment?

Financial companies, especially those of a big investment banks, if you have a when you win and and if you lose you lose mentality.

These traders and these managers got big bonuses if they want, but they lost there was no clawback.

David, quickly, do you own the banks?

We own some banks.

We do own some u.s. banks.

The question has become, and to banks become too competent at?

Do they depend too much on what people call gambling?

They were depending on gambling but i think a lot of that has gone away.

To some degree they have learned their lesson.

In 2000 one and 2002 credit suisse got their hand slapped pretty badly.

Since then they it investment bank has become a fairly stable organization.

They wanted to be more like coupon clippers and dealmakers than gamblers.

There is always a little bit of that, a little bit of improv trading going on.

I think what you really have to do is get rid of the mentality of rewarding people for success and doing nothing for their failure.

You have a skewed probability just to bruce and then -- you have a skewed probability distribution then.

These global financial institutions are incredibly complex.

I was in washington yesterday speaking with the comptroller of the currency, tom curry.

He is the top regulator in america and he said the complexity rose exponentially with size.

We are talking about an institution with million's of dollars on its balance sheet.

That to me sounds like something of an indictment or it if you have trillions of dollars on your balance sheet than you are infinitely, exponentially more complex than a smaller company.

This is what you have to divide business units.

If one business unit goes under, they destroyed that units capital winner.

Please continue.

You can advocate a british approach, ring fencing.

You can control and operation so it doesn't become so infected.

David, what are you looking for at 8:30 this morning?

What will you look for?

Clearly, the evidence supports a slowly improving job market.

People, some are satisfied, some are not.

They are looking at this jobs market to perhaps understand what the fed will do next.

The real clear thing we should be looking for is are we ever going to get to the next level of job creation?

This has been an extremely , for recovery.

We need to do is look at why we are not going up four or five percent and getting three or 400,000 -- and getting 300,000 or 400,000 jobs.

We have to look at what is so prohibitive for the labor market.

There are some really bad things that are done in four years for the labor market.

Erik schatzker is, thank you so much.

8:00 and 10:00 p.m. tonight on charlie rose.

It is time for data check ahead of the dobbs support -- and of the jobs report, right?

Nobody wants ticket position before the 8:30 number.

The 10 year yield is 2.96%. i don't want to overplay that, though.

It is fashion week in new york, so we take you to the cutting edge of what is next.

? good morning everyone, this is "bloomberg surveillance." david herro, he has flat out the single best track record in investment, certainly in international investment which is where he focuses.

Wonderful to have you here.

Once again, you like they companies and once again it starts with the and w. y? look at the quality of the business as defined by the returns, the capital allocation, the growth.

At the management team has been able to do the business.

Compare that to price and what you are paying for that business.

Business is simply an entity that produces cash flow.

To be have a board of director that wants to distribute that flow intelligently?

Are the more accurate than they were five or 10 years ago?

There is a fairly heavy family influence.

What they have basically done with access cash -- with excess cash is grown their business.

They have grown their business without minimizing or without diminishing their return on capital.

That is the key is to keep growing and adding capital without making the rest of the capital less productive.

Mike colleagues just mentioned credit suisse of switzerland is not like jpmorgan.

Why do you favor them over jpmorgan?

Credit suisse -- well my mandate is more international.

Credit suisse has a very important annuity like business within the grand total and that is the private bank.

It makes good money and probably grows in the mid-single digits.

Your income in year out, some years are worst in some years are better.

It is a very strong private rank that creates a nice, free cash flow stream married next to a somewhat tame investment bank.

It is a fairly nice combination and a trade under 10 times normal earnings.

Right now you are patient on australia.

Minors, australia, gloom.

China, relative gloom.

Australia deep down is a growth country.

They have a decent population growth.

They do have good exposure of the mining sector.

They have an agriculturist sector and a tech sector.

Because they have not been in a recession in 20 years or so and because they have benefited from the mining boom, for a long time their central bank has been running a very tight monetary policy.

They have had really high real interest rates which have made their currency artificially strong.

We will have to leave it there.

Coming up, folks.

A conversation with robert zoellick.

It is "bloomberg surveillance." good morning everyone i am tom keene with scarlet fu.

Michael mckee is in also.

Right now that's joined some top headlines with michael mckee.

They know what you are thinking, tom.

The nsa cannot crack many of the measures connecting personal information to the internet.

Everything from trade secrets to e-mails, all of this according to reports from the new -- from "the new york times," and "the guardian" ." personal cost already on the books.

This according to people with knowledge of the matter.

Defense analysts say the cost of the strikes the train 300 million and 800 million.

Peyton manning shredded the record book in the opener of the season with the denver broncos in their win over the baltimore ravens.

He becomes the sixth player in history to throw seven touchdowns.

There is your sports trivia.

It is fashion week in new york city.

Tried fashion is trending.

Andrew andrew think for a hard about what it is to come up with any given part of the selective tribe.

Whatever tribe you are in, what they know is you are drowning in digital.

Andrew andrew joins us worldwide on bloomberg television and bloomberg radio as well.

You guys go out and really think about trends.

You dress the same, as one.

It is a wonderful concept.

Why are we drowning in digital?

Well, the thing about where we are now on is that trends are dying.

What is trending?

We are hooked into the five blogs that we go to, the people that we follow, so we are in this feedback loop of positive reinforcement about the things that we are to know that we like.

It is changing, it always has to be changing.

The idea of the trend of what is hot this year or next year or in the next season is dying because we are seeing the death of the idea of the trend.

You pick a tribe, whether you are preppy, rocker , rockabilly, gothic.

I did gothic a year ago.

Really, it was controversial.

But the death of the trend is in next big thing.

The death of the trend is here.

All these companies are soon saving designs of dollars on big data.

They're looking for ways to capitalize and monetize from what they see users during.

If it is one big echo chamber, what are we getting from big data?

Every time you tweet, facebook pages, information you sent out on the internet is used by the companies to find out what you like, -- but it reinforces itself costs only, is a telling you something new?

It is telling you what you are.

I'm going to bring david in, here was in chicago, i live in new york.

Trending is associated with london, paris, new york.

How does this translate to chicago as a major midwest city, a major u.s. city, but also across america?

We are not localized anymore.

It is not about the new york rock scene.

It is about the global rock scene.

If you identify as a rocker, you are linked in with everybody all over the world who also likes your facebook page, is following the same people you are on twitter.

Are corporations going to win on facebook?

Facebook is sort of dying out, i think him personally.

I think the future is with twitter.

Facebook is a lot of feeds, a lot of news, a lot of news feeds that are quite boring.

Twitter is where it is that.

Twitter is immediate and twitter is now.

But who doesn't write?

Who uses twitter and other social media correctly.

At this point you have to have a strategy.

The companies strategies are not working.

Twitter has other services that are so much more convenient.

They're talking about how they're made service will have you clean your chandelier.

It is tongue-in-cheek because if you don't own a chandelier then you are ha ha that's funny but if you do then you are like, oh, that is helpful.

You're both wearing the striped shirts and you are with the blazer.

I cut the bloat -- i got the bowtie wrong.

Bowties are very much on transfer fashion season this year.

No they're not, that is why we are wearing them.

Your say we are exhausted digitally and we are going to description.

Describe.

Food, fashion, even marijuana subscription boxes are out there.

We are obsessed with -- start with netflix.

The ability to binge watch whatever you want whenever you want.

You have played it, clutch, franken oak.

Franken oak, they are like jake through crew.

How are they utilizing linkedin and other forms of referral.

That is our twitter question of the day.

How do you find your best employee?

Good morning, everyone.

Boy is it busy.

9:45 this morning.

President in the news conference.

We will carry that news was -- we will carry that nationwide.

As world leaders gather in st.

Petersburg, robert zoellick is arguably the american with the most diverse experience in public service.

Esther zoellick joins us from italy.

Mr.

zoellick, good morning.

Good morning, glad to be with you.

When you look at our foreign- policy as we are all riveted on st.

Petersburg and syria, how would you identify america's foreign-policy?

At least where i am today in italy in europe, there are a lot of questions because there is a recognition that president obama really tried to avoid intervention in syria, but now he is leading the effort and with a lot of questions about the response to the use of chemical weapons.

Senator mccain will be speaking by video conference later today.

I think people are asking the same questions that are the -- that they are asking the united states.

You have had terrific expense in explaining compex issues to congress.

How fast to the president state his case to the senate and to the fractious house?

This is an interesting one because he has problems on both the left and the right.

First off, it will be very important for him to make the case given his reluctance before about why it is important to act now.

That has to focus on the idea of trying to deter and stop any future use of chemical weapons, not only in syria but in other places in the world.

But second, to try to build support with people like senator mccain.

He's got to relate this used to the broader policy in syria.

How does this relate to try and support the anti-assad forces.

Where does he see this going where it is not just seen as a one-time strike rate on the other hand he has got to reassure some of those on the left or frankly some on the right that he is not going to put troops on the ground and he is not going to get the united states into another war.

Ultimately, i think he's going to have to rely on the fact that most americans, most members of congress want their president to have authority in national security.

Some feel he should've done that on his own without the congress, but now that he is gone to congress i think in the end most will feel they don't want to abandon him and weaken him.

All right, mr.

Zoellick, front and center is saudi arabia.

Sunni majority.

What do the american public need to know about the saudi royalty?

What is a thing we get wrong and what do we need to know right now about the state of saudi arabia leadership?

I think where the saudis fit in, and this is part of the overall explanation that the president is going to have to give, is how they are going to work with others in the region that are against assad.

The saudis have been against him, other gulf states and in against him, they have been financing some of the rebel forces.

Now some of those rebel forces seem to have links to al qaeda.

That obviously frightens people about supporting those who have attacked united states.

Again, part of his explanation is how he is going to work the diplomacy with countries that could be our partners but in the past might also have had differences.

The saudi's are key to that.

Mr.

zoellick, thank you so much.

Robert zoellick coming to us from italy.

David haro is our guest host today.

We don't own any big oil.

The reason is that oil prices seem too high.

The marginal cost of oil around the world is somewhere to produce a barrel of oil is 75 or $80 a barrel, depending.

We seem to be awash with new supplies of oil.

I heard the earlier discussion in libya, but there are places not only the united states but up north, east africa and even a rock who have this supposed potential of 8 million barrels a day.

Where is the biggest bully for david harro ? these are areas which are somewhat economically sensitive.

I think a lot of the executive investment community has behaved as if the end of the world was going to fall off.

It is still growing at three percent a year which is enough profitability to have some traction.

The sectors consumer discretionary, industrials, even i.t. and technology have really been bypassed by the larger part of investment community.

We think there is some very good value there.

For a good.

David herro, oakmark international.

The consensus among economists is for 180,000 jobs for the month.

A reported 160 2000 jobs in july.

Good morning everyone, "bloomberg surveillance yuriko all of our views on the ipad.

Bloomberg plus worldwide on itunes and android as well.

I am tom keene with scarlet fu pla.

We are pleased to have michael mckean with us.

We're going to look at one company, tom and mike.

You wide formerly known as ernst & young is going to be doing a lot of hiring.

Advising is going to make up a third of their recruitment in 2014. they are hoping that half of their companies will be referrals.

The company believes that referral candidates perform better and stay a third job longer.

The company has paid out higher wages.

E y , formerly ernst & young.

You've got interns, you've got recent college graduates, they are all smart and eager.

You want a referred experienced employee.

How do the young kids get that experience?

The first thing we have to do is provide a good experience at ey.

Our culture is important, it needs to be a great place to work.

You want the referral and the person 28 or 30 or 32 versus a newly minted 23-year-old?

We will hire 11 thousand people this year just in the united states.

About 40% will be experienced and referred heard there will be 6000 coming off campus where we need to have a great brand as well with faculty and students on campus.

I doing this with linkedin right now, this idea of stem.

Everybody needs math come everybody needs engineering.

Does ernst & young need liberal arts as well?

Absolutely.

We hire people in business performance and managing risk.

We are hiring all kinds of students with that sort of background.

Can you find the people with the skills to fill those 10,000 positions and are you having to pay more to get them these days?

We have been hiring a lot since the downturn.

It has become more competitive which is a good sign for the economy in the last couple years.

We are still finding them.

Are you having to pay a lot more?

Yes, i think it is competitive.

Some of our business hires we are offering six-figure salary to people with the right expense.

Profits of the big banks are coming back and pay hasn't suffered all that much at the low end.

How do you get those guys to go over and do advising an auditory work?

We have launched a strategy vision 2020. we have really excited about our purpose.

There is an excitement to join our business.

How do you retain them?

Exactly.

Great question, it is development.

They have to believe they're going to develop themselves, traffic opportunities, learning on the job.

How do battle boredom?

Ice cream at 3 p.m. doesn't do it anymore, does it?

That's right, it is friday the expense as well.

Our people are working on exciting situations.

And it is geography.

We have bloomberg lp . geography is your best weapon?

Oh, would you like to spend six months in dubai?

That really works doesn't it?

We have more than 700,000 people worldwide.

Every city, mobility and experience is an opportunity.

How do you respond to people that don't have ui skills?

They're never going to work for you, they're undereducated, we have to get the employee and what would you suggest is the best prescription?

This is where we suggest other people give back as well.

We are upping and communities.

People want to see a vibrant economy top to bottom.

All right, we have so much more to talk about on this job stay.

Thank you for joining us this morning.

We have been speaking with manager atey, formerly ernst & young.

What are you looking for michael mckee?

Hours earned and wage growth rate 7.4% the unemployment rate.

What happens with the fed and tapering?

That is coming up as well.

Coming up on "surveillance," who is hiring and whose firing.

? -- and who is firing.

Good morning everyone.

You know them from the hbo show "girls." i had to crash your bowtie party, tom.

I don't think a lot of people know how tall you are.

How tall are you?

Under no, it depends on whether my children need money.

What is the reason for the bowtie.

? tucking your shirt in, all these things are back.

Michael mckee has hit the ball out of the park.

Why is a safe thing in fashion right now?

While the economy is stagnant and slowly growing, people don't want to look to for -- don't want to look too poor.

How should people brand themselves, how should they dress?

Bowties.

I just love this look.

I think we need to take a picture and put it on your twitter.

Speaking of twitter, if you are looking for a job, it is all about creating your own personal brand, you know?

Did a clout score.

Get followers.

Make yourself -- you guys are very visually appealing.

When you go to a company like general motors, how do you get taken seriously?

Make yourself a brand.

Preemptively create a brand for yourself before you even go into the meeting.

You guys have the glasses, mine are getting fixed in germany now.

I have these black ones that i've been using.

I see all the kids going warby parker.

You guys look like the second set at wimbledon.

It is this desire to go conservative like mumford and sons and luminaires.

This is new for them.

Coming off the 90s which was all techno and raise and house music . when we talk about music, music is made on computers and laptops.

Kids have as much that -- kids have this nostalgia for this organic music made with instruments.

We have a friend who is 10 years old.

You know it she does echo she writes letters.

She rejects social media and she writes letters.

This nostalgia thing is great.

Football is on the program.

Betty liu at 8:00 a.m.. it is job stay.

? -- it is jobs day.

? good morning, everyone.

"bloomberg surveillance." robert wolf, what an interesting guy.

Frequent golf partner of president obama.

Robert wolf.

Democratic already supporter, former ubs executive.

He will join us on "bloomberg surveillance" on monday.

I am scarlet fu as always here with tom.

Michael mckee here for sara eisen.

We've got some company news for you from the files of "bloomberg west." disney to reach a new deal with dish network.

They are doing with the same issues that led to time warner calling the luck -- pulling the plug on cbs.

Disney owns the most expensive pay channel.

Espn, which despite its high price is a must-have for satellite broadcasters.

He was and is working with the ftc to get approval for its arbitron deal.

They are making concessions with regulators to how they are using their technology.

Nuisance proposed one $.25 billion buyout of arbitron.

Google has a new headquarters in london.

It will feature a swimming pool and a running track on the roof.

There will be room for as many as 5000 workers.

Construction is scheduled to start at the end of this year.

Google is set to move in sometime in 2015. that is today's company news from the files of "bloomberg west." this is one of our favorite things of job stay.

We routinely go out to grand rapids michigan where they are hiring, well, maybe they are hiring across america as well.

Where are the jobs?

There is a good outlook and then there is a worse outlook.

He spe

This text has been automatically generated. It may not be 100% accurate.

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