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tv   Market Makers  Bloomberg  October 22, 2014 10:00am-12:01pm EDT

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>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. new frontier -- the sporting goods market catching fire, women's activewear. we have an exclusive interview with mark potter -- parker. tells "i've got posts higher! revenue. >> johnson & johnson takes a shot with an experimental vaccine for ebola. you are watching "market makers ." on this wednesday, i am erik schatzker. >> i am matt miller. we will hear from stephanie later in the hour, an exclusive
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interview with the ceo of nike. with the kick it off top global stories we are following. the cost of living barely rose in the u.s. last month. the consumer price index increased just 0.10% in september. energy prices fell and will probably drop more this month. cross your fingers -- the average cost of a gallon of gas is the lowest it has been in three years, $3.09. consumer prices were up just 1.7% over the last 12 months. shares of yahoo! are trading higher. the internet portal posted third beat -- quarter sales that estimates. marissa mayer use the opportunity to defend her turnaround strategy and she says yahoo! will keep making acquisitions. strategye a clear m&a and we will continue to seek
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opportunities and be smart about it. >> morrison meyer might have been taking a shot at star board who wants yahoo! to split up. hisloeb has a new target in sights. stakeoint has boosted its in the company and wants amgen to break up. amgen said it appreciates the perspective of all shareholders. dan loeb just sold stake in sony. the company rejected his push to spin off a portion of the entertainment business, but third point says it made close to 20% on the investment. inmler bonds sold its stake tesla. the electric model s actually outsold the dime member cities -- mercedes -- daimler mercedes.
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with might prefer working bmw. finally, one of the legendary figures in journalism has died. guided thee washington post during the watergate scandal. he spearheaded the stories that eventually led to president nixon's resignation. they also won pulitzer prize. marissa mayer -- >> marissa mayer has a message for her critics -- "it is all good." yahoo! the five expectations by posting an increase. analysts expected a drop. marissa mayer told investors she has a clear turnaround plan that is already starting to work. the shares are up this morning by almost 6%. we are taking a closer look with an analyst from stansberry research. you have come effectively, a
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hold rating on yahoo! shares. what did you make of the comments on the conference call -- it is as if they were a point by point rebuttal of everything jeff smith, the activist at star board has demanded, without actually saying his name or star board's name. >> as he said, it is all good and they beat their estimate. the algorithms said bye-bye. that is why it is up today. >> momentum. >> yeah. there were a lot of things that troubled me and i was concerned. >> do tell. >> there is the hockey analogy that you play to where the puck is going to be not where it is at and i feel yahoo! is playing where the puck is that. and thatfocused on ads was the story five years ago. it is not really where it was -- where it is in five years. >> what about the fact that she
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says we were able to reap the fruits of what we have been selling over the last few years -- sewing over the last few years. i scratch my head because if you have made billions of dollars in acquisitions, shouldn't your revenue rise more than 1.5%? >> right, we paid for,, and they will make $100 million, and that means that will take them 10 years to make money off of tumbler? andare looking at google facebook that has instagram. what have they gotten off of tumbler? >> if you take out the game from is sale of ali baba, which $6.3 billion, they basically made $500 million compared to 297 in the previous quarter, not so bad. >> not so bad, but the operating income fell. what is troubling, when she talked about cutting costs --
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the activist investor said we have to cut costs. she said we closed eight offices, carlsbad, oshkosh -- how many people were in those offices question mark seriously -- offices? seriously? they were also asked what were the traffic cost for mobile users. if simple question, but they fumbled their papers and said we do not have the number, we will call you later. like the cfo does not have that money. you know -- that number. you know they have that number and it is costing them a ton. >> what is the path forward? do you agree they should break up and investors deserve to realize the gains that are built into the alibaba stake and the yahoo! japan stake, and we should really be given an opportunity to know what yahoo!'s core business is truly worth? >> i think what she is doing is good for the company right now.
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have is a reason to yahoo!. opportunity, but i feel what she is doing will not pay off. she is spending an enormous content, andey for the numbers will show she is not making the number -- amount of money she is spending. chart backup. yahoo! japan, 7.8 and dollars in cash,, it has to be worth more billionative $4 question i have not used it in -- since i was a kid -- $4 billion? i have not used it since i was a kid. >> it do you go to yahoo! -- >> do you go to yahoo! for
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searches? >> no. >> let's go back to the wayne gretzky analogy. ?here is the puck going what does marissa mayer need to be looking at, buying, building in order to compete where -- with where facebook, instagram, and maybe other platforms are going -- going? is to be visionary and look at what is drawing people. if she could afford it, i would go for pinterest tom or hip.hing that is young and i wouldn't go that route. >> you support the acquisition strategy. >> i think she will have to. she said several times about how legacy businesses were holding them back, the technology business was old. >> do not forget the office in oshkosh. that was holding them back.
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surprised they did not spend a lot of time talking about snapchat. there is a world out there for snapchat, and there is where you cap sits in. tumbler is longform and that is not what people are going right now on the internet. >> thank goodness. i'm going to check it out. it sounds like it is up my alley. >> if you are 15, it is up your alley. >> debra borchardt, thank you. finding common ground -- a crisis or two is enough to bring the u.s. and france closer together. we will hear from the french ambassador. biggest the ceo of the sporting goods company in the world. mark parker of nike. it is a bloomberg exclusive. ♪
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>> slowing economic growth in europe, the ebola crisis, and the fight against islamic state -- just some of the issues bringing france and the united states together. peter cook is standing by with france's ambassador to the u.s., gérard araud. >> thank you. i am joined by the ambassador, gérard araud. welcome to washington. a big tragedyut
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in france, the death of the total ceo. i wanted to get a sense of how this might impact french-russian relations. we had tensions over the ukraine. do you see this as adding to the tensions, or do you see this as a tragedy on its own? >> i think it is a tragedy on its own. ceo, so charismatic, his death is a personal tragedy. chosen aow, total has new president, immediately, who actually was the previous ceo, so now total is in a transition period to adjust to the new reality. >> he made a lot of headlines in the united states because he was that questioned sanctions against russia over the you can -- ukraine. does france any reason to ease up on the sanctions? >> no. it is very clear.
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we said we would accept sanctions easing only if russia take significant steps on the ground in the ukraine and for the moment, unfortunately we are not saying that. weapons are flowing to the ukraine. there are still bloody incidents between forces caret we are still far from it. -- forces. we are still far from it. >> what are the sanctions' impa cts in france today? what will happen with the air carriers deal? >> the french president has had, it is really based on the situation on the ground. we have put the delivery of the missile system on hold for the moment. we are looking at a situation -- as we have said, there is no reason to use sanctions -- ease the sanctions. at the moment there is no reason to diverge on this path. >> another issue you are working
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with united states, france as part of the coalition taking on the islamic state in iraq, but not in syria. what is the distinction? >> we consider it is not possible to strike in syria without having a syrian strategy. striking, think that conducting a military operation in syria does not have a consequence on the civil war and especially situation of assad. we want to know what is down the road. at the end of the slippery slope, are we going to become de facto allies of assad? no. it is not possible. what are the roots of isil? theally it is the sun or daughter of the civil war in syria. ,f you want to defeat isil first we are convinced you have to solve the civil war in syria and that means you have to get rid of assad.
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>> are the airstrikes the united states is conducting in syria counterproductive, do you think? >> nooks, because they're necessary to weaken -- no, because they are necessary to weaken isil, but they are to be soducted on the long-term, it will have consequences on the civil war sooner or later. we want to have a strategy. we want to be clear about what it means. >> president francois hollande and president obama spoke recently about not only the fight against the islamic state, but also the ebola crisis in west africa. if you could give us perspective, how is the ebola crisis been received in france versus the united states question might do have a unique vantage point where you have seen the reaction here, and there is planet in -- panic in places like texas harris what is your -- texas. what is your assessment? >> we have not had any cases in france, so there is no panic in france.
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we are serious about it. we have put in place an organization to face it. we have a national exercise about ebola, but for the moment there is no panic, but again, maybe because we have not faced it on our territory. >> what about the president's call in the united states for the next -- for the international committee to do more to stop it at the source in west africa? >> with the american president told my president, and other members, the british, the german, italian leaders, is that we have to break the exponential curve of infections, which means isolating the infected persons, so, the u.s. is doing it in liberia. the british are doing it in sierra leone. uinea. is doing it in g that was, in essence, the -- of president
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obama. >> let me go to questions about a slowdown in europe and whether there are questions that -- steps that can be taken in france and germany. the united states has been delivering that message. is that helpful? >> yes. they're not the only one. the imf is delivering the same message. there is a dialogue between the french government, which has announced significant reforms, especially in the labor market, and also telling the germans to do their part of the job, in terms of expenditures, in terms of investment. we need to boost the demand in europe. >> will we see a trade deal between the united states and the european union in 2015? >> i hope so, and the french are committed to it. . >> thank you again for joining us. >> peter cook, there with french ambassador gérard araud.
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i am, of course here with erik schatzker, because stephanie is going to be with nike. correct peter is in washington -- >> peter is in washington, so it is understandable he did not know that. correct and also, you look -- >> and also, you look like stephanie. johnson & johnson is about to start the trials. fascinating work. ♪
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>> there is not a whole lot of inflation out there, nevertheless today consumer price index report came in higher than economists had estimated and that was enough to give the dollar a boost, and also to interest rates and inflation expectations. that is important. michael mckee is here to explain. why such a reaction? >> everyone has been concerned
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about this inflation, particularly the fed, and james bullard said if expectations keep falling, we might see the on hold, andaper there was an expectation of a drop in the cpi to 1.6%, and instead we get no change and a slight pickup in inflation. it does not mean disinflation is off the table, but at this point it does not look like it will be a problem. very few things fell in price -- tobacco, used car prices, energy -- not much else went down. airfares, but that is not a long-term issue. >> i mean, we are flatlining at 1.7%. flatlining, but the question is do we see it go back up? number, of the headline that will be and inflation story. oil prices are not flatlining. you do not see movement in oil prices between the $85-$90
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range. >> we would not have seen this inflationary impact yet of oil prices. now, that will affect the headline cpi. >> and there is a real contango. they were saying it is going to ifbelow $80 comp question is it goes down to $75 or $70. >> that is the real question, but the fed looks at all inflation. that is not falling. a lot of things that americans pay for they see rising, and i be interestedd in this one, the beer index. the air prices have started rising. that will build into americans minds. gasoline, food, that goes up, people get concerned. inflation expectations start to rise.
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>> necessities, gasoline, beer. >> would we not see the inflationary impact of rising beer prices offset by the disinflation or quality of dropping oil prices? >> that is a question because gasoline prices have gone down a lot. aslation expectations, measured by the tips spread have started to rise again. that was james bullard's concern. we cannot let inflation expectations fall. if they are rising again, that will take off the idea of the taper pause. >> i was wondering what effect that would have on equities. he did not see much movement in the equity market today. datame you get economic recently related to the taper or lack thereof, you see movement in the markets. out ofother news we got the report was you did not get wage increases. people's weekly wages stay
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unchanged for the years -- for the year and it has been a long process. >> mike has been beating the drum ever since i met him. >> i have not figured out that you cannot give me a raise. >> we will take a break and then talk about big pharma big battle, or maybe asterisk the move. stay with -- altruistic move. stay with us. ♪
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>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. >> it is 10:30 a.m. here in new york city. i am erik schatzker. >> i am matt miller, in for stephanie ruhle because she has a fascinating, exclusive interview with mark parker of nike. johnson & johnson has emerged as a leader in the race for an ebola vaccine. they will have an experimental vaccine by may. working outine is
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how to produce enough of medicine already being tested. we want to look at the jj strategy with its chief technology officer and our health reporter. paul, i will address this to you, although there are skeptics on wall street, it seems like a straight up, all joystick move, like -- all joystick -- all twisted move. they are looking to be world good -- good world citizens. >> the case is an important one. ebola is a global epidemic. --is out of control, it and out of control, and we are trying to provide a response to that. we were asked to accessories because the disease is out of control, and since we have to capability, the capacity, the
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science and technology, we are gearing up the max we can to make as many vaccines as possible, as soon as possible, to help the world protect against ebola. >> and will you make a profit on this? is absolutely not the first objective here. we do not know. we're working hard in response to a global crisis. afterwards, we will seek if it becomes a global used -- see if it becomes a global used faxing. the first thing now -- vaccine. the first thing is being assessed as possible to help the world get control of this disease as the first and foremost objective. >> paul, described for us where the development is right now. as i understand, j and plans to have these ready by may, but what do we know today? >> testing has shown 100% detection if you use two different vaccines, a prime
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boost. it, we have been able to show in preclinical models 100% attention. what we -- protection. in test batches we have been doing the last few weeks, we have been able to significantly of skill the we were able to produce 140,000 vaccines in a 10-meter vessel that is now used to do the preclinical toxicity, the evaluation that is needed to bring it up to the next round of production. the we also know is that the nordic can follow with that reduction in parallel with us. we now have to do is safety trials in patients that will early-january, as early as possible in january and that three months two to
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to learn whether it is well tolerated and gives protection that we can measure in humans by taking blood. if we know that, we are ready to start large-scale phase three studies in may and we will have 350,000 vaccine combinations available to be deployed in the world to protect health care workers and people at risk living with family with ebola. buthis all sounds great, there is a lot of risk around vaccine production and you are moving at an unprecedented rate. we have not seen anyone produced this type of vaccine this quickly under the circumstances. what are the risks, the cautionary things people should be thinking about? humanstill need to test for safety and that we will know in the first three months of next year. we know that we can make it. we know it is a factor in animals. the risk is the next step on safety. if that works out, i am confident that we will be able in the course of the next year to deliver the faxing which will
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help -- vaccine, which will help people protect, and we know we can scale up to at least one million during the course of 250,000r, about 350 -- per quarter, and we are working with industry partners to go further if we fight -- find the capabilities to do that. let's talk to me about that collaboration -- >> talk to me about that collaboration. you are working with other companies. you are considering if, glaxosmithkline, for instance, gets on the right track, to who these competitors. what is that collaboration like because it is something you do not see office -- often? >> we have seen some precedent with helping each other, and that includes not only >> smithkline, but also pfizer and other companies that are bringing the production capabilities to their. we -- to bear. we are discussing it as we speak to accelerate more than we are
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today. once you are meeting with, talking to the chief scientific officer said his other countries? >> yes, and alex is talking to all of the ceos, so we will make sure everyone is working together to get the possible ash best possible results. -- best possible results. >> given the resources, time, and effort that j&j is pouring into the research for an ebola vaccine, what do you have to back burner as a result? >> nothing. the engagement you get is fantastic as everyone will put in the extra hours on top of what we do today. there will be no impact on any of our other programs. our team is very dedicated, very encouraged. , the 125,000&j employees, all are committing part of their time on top of what they do normally for the company. i wouldn't worry about that.
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>> now, you're looking for a vaccine, which would help to protect hundred of thousands, and potentially millions of people from contracting ebola in the future. is there anything you are learning in the development process that could be applied to the work being done right now on ebola treatment? >> i should highlight that the vaccine, of course, is to protect people who are not yet infected. .> right >> and that will take time to deploy, etc.. of course we have capabilities in other areas and they're the industries are pulling together across all the pharmaceutical companies to learn how quickly we can do what we do with vaccines now -- bring to bear for drugs. there will be more news to follow in the coming months because there will be an unprecedented effort from industry to get this done. thisul stoffels, should elaboration have been happening sooner? we are on a chair factory where
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we could have 10,000 people a week infected by -- on a trajectory where we could have 10,000 people a week infected by december. what it is. we worked under the radar very hard for months. what we learned in the last few weeks and we are confident now to talk about is we were able to upscale the production because we have a very unique sideline that could have huge results in canue -- volumes and it help accelerate this and i am confident to talk to the world to say we are committed to do this in the shortest possible time now that all of the technical elements have been validated. rest reassured that this is not started yesterday. this started months ago when we knew ebola was going to be a problem in the world. >> paul stoffels, the chief scientific officer at j&j. thank you for your time.
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this is one case where we can all be wishing you the best of luck here and we hope your work is done as quickly as possible. shannon pettypiece, thank you for joining us. the bloomberg of care reporter. we'll take a quick break. >> s, and when we come back, he had -- >> yes, and when we come back, he has been doing it at nike for 35 years. you will hear about the companies asked big push from the ceo mark parker. ♪
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>> there are just a few days to go until brazil's presidential election runoff. it is a dead heat right now. the polls show a statistical tie
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between the current president and her challenger. investors, for their part, zppear to be hoping that neve wins because whenever the polls show him gaining ground, the stock market moves higher. both sides agree on the need for program.welfare as willem marx reports, it is simply because it has proved so successful at combating poverty and results. have -- in brazil. have a look. walks absolutely everywhere in the brazilian mega-city of são paulo. that is because for many residents, public transportation represents an extravagance. >> there is the bus. the boss does not get the money for the bus, so we walked. day,e works six hours a six days a week as a domestic servant, doing household chores
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for middle-class families that live far. thanks to labor regulations introduced by the workers party, in today's brazil, she is registered as a formal employee and qualifies for the minimum wage. >> things have improved a lot for me and the other people. i feel it is much better than before. at least now i am working. >> improving the rights of workers has been one of several policy priorities that in recent years has helped to reform brazil economy and reduced its wealth gap. her small family, like millions of others struggling to make ends meet receives a monthly payment as part of a government program, the family fund. the payments do should be to dead center like this one currently benefit almost one quarter of brazil's population, but are still economically cost-effective. >> when you compare it to the
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problems, it is pretty small. he previously headed economic policy at the brazilian ministry of finance. tre andfa -- famlia is important for quality. the drop in quality is almost entirely due to the labor market. in the so-called informal labor market. a good month here is the equipment around 400 u.s. dollars. the minimum wage as a made that's the equivalent $294. then, after including $14 a month extra for the aree-year-old, they add further $45 to the family income . >> it helps to pay the electricity bill, health insurance for my son, to taken
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to the doctor, to do a medical examination. >> some critics say it is a vote-buying mechanism, voters to to woo poor her workers party, and as brazil's recessionary economy continues to contract, the provem's popularity could useful at the polls. >> you cannot show good economic in the, so the effort political debate is to say look what we have -- social policies. increasinglye polarized politics, both candidates have said programs will be preserved, proving that nonpartisan a policy decisions could make poverty hear a thing of the past. >> willem marx, back here from brazil is to talk more about the upcoming elections. >> it is going to manage stingrays on sunday.
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-- it is going to be an interesting race on sunday. all of the other polls have the incumbent very slightly ahead. too close to call. >> let's not forget this is an incredible come-from-behind performance. initially, it seemed the main challenge would be from the left. >> if you look at the support, up until one month ago, it was very low, and then finally marina silva fell behind him. she was attacked by the incumbent, and he took over. tendlot of wall streeters to think that nevez would be a better candidate, but recessed is closely working with petrobras and both of them are for continuing this social security, the social welfare program. >> radcom of that petrobras --
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right, but petrobras will be a problem. there is a huge scandal about it next will be looking -- kickbacks. we'll be looking at that in our reporting tomorrow. damaged allegations of corruption. the former president was in charge of petrobras so she is taken some flak for the moment. >> kickbacks in brazil. never. i'm shocked to hear there's gambling in this establishment. >> thank you, willem marx. draine come back, bring -- brain drain -- there are plenty of israeli companies going public, however they are not doing it in israel. it is happening here in the united states. we will see with the tel aviv stock exchange plans to do about it. ♪
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>> israel has one of the most vibrant entrepreneurial cultures allhe world, so why aren't
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of those tech startups going public on the tel aviv stock exchange? just four companies held ipos, atn from 66 in 2007 home and the same time the number of israeli companies going public here in the united states, tripled over the past year. we are joined by a ceo. so, what are you doing? >> you are right. israel has the most vibrant startup culture in the world, and we have seen over the last few years that some companies, when they reach a mature stage and can go to world markets, they prefer to do it in the u.s. or sometimes in london. that is ok. if the company is large enough -- can't attach -- attract and can attract global investors, they should do it. if you look at the effect of 600 2000 -- were created in in 2013, and about 5000 are active now, it is natural that a
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lot of them will not mature to be large companies, but at some stage in the cycle, they have exhausted the angels, the neighbors, the grandmothers, and they are at a fork -- where do we go? sadly, what is happening is they tend to be sold. this is where we should step in. small to that are medium size, not big enough for the large markets, should find a very good home in tel aviv. >> i do not feel like it is a problem unique to israel because we see companies in the u.s. putting off ipos much longer than they promise -- previously what have. -- previously would have. >> correct. >> i imagine that would be a problem for companies in israel as well. obviously, they will wait until they have grown big enough to go to new york. >> unless a regional exchange like ours can find a niche and can nurse them to go to the world markets after that --
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nourish them to go to the world markets after that. in order to do this me to create the right environment on the demand side and supply-side. effort to give them a combination of tax incentives, easing their listing requirements a bit, allowing them to file and do everything in english so that they are ready for the world markets. we will provide analysis because if a company is small in number, nobody cares, nobody does analysis, and investors will not come. gradually, the market will mature enough to be interesting niche to bridge the gap to start up nation with small companies and companies that are large enough to come to the world companies. >> take off your ceo hat for a moment. >> ok. but pretend you are a venture capitalist. what is wrong -- >> per tend you are a venture capitalist. what is wrong with m&a?
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from a company perspective, it might not be the right answer. they want the ability to grow. they want a little bit of the abily to do some work on their own with stock they can use and potentially benefit their employees in a better way. of course, companies will do what companies do, but i think if we can create a market that is vibrant for these kind of companies they will come. at the end of the day there is an equation -- what do i get? the price of being a public company, is it higher than the valuation that i will get as a private company? >> you say you are trying to ease the listing requirements for israeli companies to go public. have you studied the impact of the jobs act here thus far? do you think it has worked? >> i think a version of it for israel would do wonders. >> when you say wonders, what would constitute success? >> a lot of times -- and i have been in a couple of startups in my life -- you do not know anything about the market.
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you go to your lawyers, your accountants, they tell you to do this, this, and this, but think about the idea that as a private company you have some connection to the exchange. they may do some work for you, run your tables, helping you with your options program for your employees. at that point, you begin to be interested in the conversation is much easier. it will say why should i go sell the company? maybe a public offering is more interesting. >> it does seem like the wrong side of the equation to work on -- you have falling volumes. companies will want more liquidity. you have a sunday through thursday schedule at it companies will want to trade on the same schedule as the rest of the world. >> as you know, we have talked about moving the schedule from monday through friday. >> why not do it instead of just talking about it? >> is as you can imagine nothing is as easy as it looks when you just say it.
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copies have to change what they do, advisers not have to work at different times. >> we have run out of time. yossi beinart on the tel aviv stock exchange. ♪
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>> live from bloomberg headquarters in new york, this is "market makers." it's not just about the shoes. nit is engaged in a multibillion-dollar battle over women's sports apparel. -- nike is engaged. a wild ride for hedge funds. the violent swings in the market . we discussed that further. he is the academy of the iconic investor. carl icahn sits down with bloomberg for a wide-ranging discussion on activism and the economy.
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it's 11:00 in new york city. you are watching "market makers ." >> i will take it off right now with the ball. more shots have been fired near the parliament building in ottawa. a soldier was shocked at the nations war memorial. police return fire and killed that gunmen. no word on the wounded soldier's condition. earlier this week, two members of the canadian armed forces were hit by a car outside of montreal. the government says the attack was linked to "terrorist ideology." one of the largest energy companies in the world has named a new ceo. patrick will succeed christoph
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who was killed in a plane crash in moscow this week. been running the refining business. he will have to oversee a round of cost cuts. profit has been drinking because of lower oil prices. ballmer about his time as microsoft ceo and he sounds like an old sinatra song. but not he has a few, too many. he puts himself in a unique class. jobs,l gates, steve obviously. they are amazing. i was not just a passive participant on the ride. i feel really good. all of thatatch interview with steve ballmer tonight on trolley rose at 7:00 and 10:00 p.m. eastern -- charlie rose. to see whoin a race
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has an ebola vaccine first. johnson & johnson plans to have a quarter million doses of its expandable vaccine ready for clinical trials in may. that may put it ahead of glaxosmithkline. they will spend $200 million to speed up and expand production of its ebola vaccine. glaxosmithkline will put those resources behind a competitors efforts. you think about nike, you think about shoes. nike gets to 5% of its revenue from women's apparel. revenue last year. that could double over the next five years and nike is looking for ways to grow it faster by lululemon.ith stephanie ruhle is standing by with the nike ceo. >> forget lululemon entity does. i just watched the nike
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presentation flanked by new york's most important fashion magazine editors. >> we are first and foremost a sport brand. sport is moving into lifestyle in a clear and present way. sport is all around us and its influencing everything. tights are the new denim. you see sports wear all the time. we are a part of that. >> you mentioned the nike female athlete. missy copelandnk is the face of another brand. do you see your self signing athletes that could be dancers? are represented in traditional sports. use the athletes every day. -- uc athletes every day for we are focused on the best athletes in the world. we are also focused on everyday
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athletes. -- you see athletes every day. we are focused on the best athletes in the world. york with here in new under armour. nike's firstink and others are following. why are you second to the game? >> we have been working with female athletes for over 40 years. athletes amazing covering a range of sports today. sports and health and fitness is not new to nike. it happens to be one of the most vibrant and fast-growing parts of our business. we are incredibly excited about where we are. to 65 are connected million women digitally. do you see yourself as a tech company? >> social is everywhere. everyone connects with each other socially.
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nike is no different. we create platforms or we work with different platforms to connect with 65 million women. we also have women signed up with nike+. it's the fastest growing app category out there. 85% more than any other app. nike is part of all of that. clearly, the nike customer, the female customer is important to you. was she a factor in your decision when you severed ties with ray rice? >> women athletes have always been important to nike. fitness is becoming more a part of everyday lifestyle. it is permeating every aspect of culture and society. this is not a trend. it's a movement. it's a cultural shift in a way.
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we have a very close relationship with the world's best athletes, but women in general. that's where the insights we drive our innovation come from. >> you have a close relationship with the nfl. can you help change nfl culture? that we haveidents all heard about and talked about are very troubling for everybody. not just in terms of sports, but society. we made our position known with the nfl that we don't tolerate any sort of domestic violence, child abuse. that's really important. i see the commissioner responding. this has been a great lesson for the nfl. he has it knowledge that and is moving forward. i'm optimistic they are moving in a better direction. >> you have not severed ties or make a statement -- made a statement with regards to hope solo. >> we keep close with current
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situations. we assessed based on the knowledge we have. ties with what's going on in that situation and make our judgment when the time is right. theust two weeks ago was female half marathon sponsored by nike. they are more the athlete sponsor. when i look to the world cup, adidas was the name on the marquee. you are the number one seller of cleats. is that the direction you want to be in? >> we have always been close to the athlete. it's what drives nike. it has been that way since day one. it continues to be that today. we are less concerned with sponsorships of events and more focused on the connection we have with athletes. >> do you want to sponsor
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more women? the support of women and sponsorship of women and women's sports is a natural part of who we are as a company. culturala growing shift going on with women's sports and health and fitness. a growing awareness, a movement that transcends sports in a way. the numbers are amazing in terms of participation. jim memberships are way up. -- gym memberships are way up. it's amazing. buy.c. yourself looking to the reebok brand? -- do you see your self looking to buy the reebok brand? the one thing reebok has going for it is crossfit. >> i'm happy with the
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opportunity nike has as a brand. we have nike, jordan, hurley, converse. that's where our focus is. jordan? lebron outsell >> mj is a tough act to follow in that sense. never say never. the business we have established around michael jordan. i have been there since day one when we introduced the first jordan shoe. he is the athlete other athletes love. when he walks in the room come everybody's jaw drops. it's interesting to watch that. >> you've cut 30 steps out of production.
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can we see the production of these issues moved to the u.s. because it so simple to make? >> the techniques and methods that are advancing very quickly, that is a possibility, absolutely. to see manufacturing and parts of the world we don't see today. >> while lebron is such a big name, so was kevin durant. there were huge headlines over a $300 million deal. nothing.'t say it's kevin durant is an amazing athlete. on the court and off the court, we are all big kd fans. was there ever a chance he would lose the contract with kevin durant? was under armour really in the game? >> i can't really say or speak -- we were focused on
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what we do best. we have had a great relationship with kevin. he is a big nike fan. we were confident in our relationship. even more confident in what's possible. >> you mentioned converse. you have 22 lawsuits out there ralphalmart to lauren because they are stealing your jam. i.t. properties incredibly important to us. we are taking the steps we need to there. we are very bullish on the converse opportunities going forward. >> have you thought about resale value? there are secondhand jordan that
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go for $2000 apiece. why let that go in the secondhand market? would you open up a nike second-story platform where you can resale and capture those profits? reallyn't think we are focused on trying to capture that secondary market. that is always going to happen when you have a popular brand where products sell out quickly. are there some things we can do to take advantage of that? possibly. that has not been our fixation. it is to create the best product we can and let the consumer decide. >> is there another way to work with apple again? is an extranet rebrand. nike is an amazing brand. it seems like a marriage made in heaven. >> i'm quite bullish on our relationship with apple. tim cook is on the nike board.
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with steve jobs. as i look ahead and what's possible between nike and apple, two amazing brands, technologically, we can do things together we could not do independently. that is part of our plan. to expand the whole digital frontier in terms of wearables and go from what we say is tens of millions of uses. >> do you believe wearables are the future? >> i think it will be a big part of the future, absolutely. what form it takes is the big question. people getting more information in a simple, user-friendly way, getting feedback that helps them understand themselves better is a way to improve your self. i think wearables -- the form it takes is what is critical.
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things that are more stealth, more integrated, more stylish and more functional. >> one sport we have not hit on is golf. rory, maybe you're overpaying. is he going to be the new tiger for you? non-golf fans will still say who plays golf? i think tiger. there have not been other marquee names. will rory breakthrough? >> i think he will. i would not say he will be the next tiger. they are both unique and incredibly talented in their own way. tiger will come back. doy will continue to incredibly well and have a fantastic career. >> nike is selling so well.
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nike's marquee stores, what can you see in five years? we have and integrated marketplace. that integration of all of that is really what is critical. i don't foresee a point where all of that will be nike owned. ofo think that integration all of those channels, all of those forms of retail will be critical. how they playoff each other and how we segment those various channels to work better together . >> what is your number one favorite nike product now? you have to. >> i'm a big fly net can.
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-- fly net fan. the best is yet to come. >> sneaker heads, get excited. thank you so much. an extraordinary event right here at nike. stephanie ruhle wrapping up an exclusive interview with the ceo of nike. >> he loves the fly net. i'm not so sure. i'm a classic jordan guy. >> matt miller is wearing jordan's right now. we are going to take a quick break. thank your portfolio has a rough last few weeks? we talked way former hedge fund talk to a former hedge fund manager.
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>> it was a full on rush to the exit last week. stocks plunged in treasuries sword. treasuries soared. a former hedge fund manager and adjunct professor at columbia university and a bloomberg television contributing editor. what was it like to be hedge fund last week? >> it was miserable. it was a stress test on the system. everyone has known about the potential for rising rates. ofre was very little anything new or shocking at the time.
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a lot of funds failed. >> i want you to listen to what the re-think told me yesterday. he is not a hedge fund guy. fink told me yesterday. he watched this stuff from a position of relative called. >> much of the blood was fast money. it was leveraged money. best of the professional hedge funds have lost limits. many of them hit their triggers. all those triggering mechanisms created an aggravated market. therewind was serious and was some major blood as a result of it. >> there has been a weeding out over the past couple of years because of so many strategies have not been working. now, we see market volatility and hedge funds are failing. darlings are fund
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absolutely going to come under pressure. you'll get at something like special situation or event driven funds. -- reality is the performance of the event driven funds over this time was absolutely abysmal. they say we don't need to hedge because we are in such a specific positions. you know, when the market pulls outcome of the average event fun d shown to be in no way market neutral. fund is downvent more than the stock market was overall. we are in stocks that are so special and different they won't move with the market, that fell by the wayside. you look at the returns, how much of the returns have in fact
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been the most expensive data in the world? ?ow much have you been adding market was up 30 and you were up 15, you still took 20% of that 15 and pocketed it for yourself. there are managers out there doing it legitimately. it has been a challenging environment. the number of deals in the public market is much less than people think. it's a lot of private activity. keeping that flat positioning has been what people claim to do. --se midweek results everyone sends a weekly update now. they saw these numbers. >> how bad were those numbers? paulson, numbers from
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who is not having a great run for the last half decade -- >> one big hit. >> the house in the hamptons is paid for. on thatit down 22 front. i've heard down 11 on some other funds. --this is only last >> since midweek. >> we have a chart of hedge fund activist strategies versus the s&p. what far underperformed the s&p 500 looks like alone. >> how much is really alpha? how much of it was not? discovery was at one point down around 11%. these are big numbers for these guys. how many of them got stopped out?
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how many of these losses did not come back with the rebound? timesou're leveraged five -- >> a harsh lesson of leverage. worth, even after the post crisis shakeout, at least -- there is too much leverage. maybe that should make you sleep better at night. is elsewhere. >> the concentration of those in pinions -- those opinions is intense. what are they most bullish about? it's highly concentrated the two years, 10 years and other traits. everybody is long s&p short russell. there's a lot of smart hedge funds taking systemic short interest rate use. if you do that, you have to be willing to write this out.
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if you are taking a huge short bet and you get squeezed, you are going to get killed. >> we are taking a quick break. stick around. ♪
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>> there is breaking news in the canadian capital. the parliament and other buildings in the area are on lockdown right now. you are looking at a live shot outside the parliament buildings. please in ottawa are saying they are investigating several shooting incidents. one soldier's condition is unknown. two members tweeted that a gunman has been shot and killed. there are multiple reports on twitter of other gunmen. chief is onureau the phone with us. this is a breaking news situation.
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what do you know right now? >> what we know for sure is that a soldier was gunned down at the war memorial across from the bloomberg offices. gunman with a long rifle went up to two soldiers on guard. rifle cameth a long up to them and shot one of them. it's not clear whether the soldier survived or not. witnesses at the scene said the gunmen fled towards parliament hill where we know -- we don't know if it's the same gunmen. there are conflicting reports on how many shooters there were. we know there is at least one. possibly the same one that shot the soldier at the war memorial.
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which is a few hundred meters from parliament. ranrding to witnesses, he toward parliament hill. who enteredshooter parliament hill and was shot down in parliament exactly where the government caucus was meeting at the time. >> there are choppers in the air and dozens of police cars on the ground. that's where our bureau is right across the street. we don't know yet, cannot confirm there were multiple shooters. it does appear from the information that is flowing through twitter that there might have been a sniper on the roof of a building? there may have been somebody running from downtown ottawa. running is somebody
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through downtown ottawa with a rifle. we don't know if it was the same man who shot down the soldier. are conflicting reports. there have been reports of more shootings. nothing has been confirmed yet. we do know the police have locked down downtown ottawa. they are on high alert. there are gunmen outside of our offices -- >> gunman or police? >> police. do you know about the condition of the soldier who was shot? >> we do not know. >> a few reports of people giving him cpr. there are some photographs we can find on the internet. do want to share some video that appears to have been taken with a cell phone inside our limit.
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-- inside parliament in the middle of the canadian parliament building. this was taken not very long ago. you can hear live shots being fired inside the canadian parliament building. witnesses who we have spoken to who say there was a gunman who entered the main parliament building, literally feet from where the government was meeting at the time. the images you see there are room whereont of the the government was meeting at the time. you see dozens of parliamentary security shooting at this individual. >> one of the maintenance workers who is mentioned in the bloomberg story -- is there any significance of that? ,> i have heard various
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conflicting reports from eyewitnesses. one thing he was wearing a bandanna come another saying he was wearing something on his head. he had long hair. gotten aot really confirmed sense of what this -- we know he was a man. >> thank you very much for bringing us up to date. saying,t goes without one of the reasons this situation is as serious as it is is that it is so rare north of the border. gun violence does not happen very often. police officers are almost never gunned down in the line of duty.
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they're doing their best to respond to a situation that is incredibly unfamiliar >> it would be rare here as well if there were gunman shooting in the capital. considered a safe place. which is why you can walk right in. >> our thoughts and prayers go out to the soldier. i hope he pulls through and we will continue to bring you any headlights on this as they break. one gunmen issues in there were quebec, soldiers killed. >> we will take a commercial break. "market makers" will return in a moment. ♪
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>> moments ago, we brought you the breaking news out of ottawa.
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shots had been fired on parliament hill. now, we have an update on that story. the military officer who was guarding canada's war memorial and was shot by an unknown gunmen this morning was killed in that attack. the gun man went into the houses of parliament and opened fire. is reporting the canadian forces bases are being shut across the country. not sure if that is a precautionary move. you can see live pictures from parliament hill in ottawa. police are searching cars leaving ottawa trying to go to the neighboring province of quebec. we will bring you more information as it becomes available. >> we are going to turn now to carl icahn. of the most active activists in the world over the past few decades.
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stirring up the pot at companies like apple, ebay, dell, clorox and netflix. stephanie ruhle had a chance to sit down with carl icahn for a 40 minute conversation yesterday. she started by asking him about the fed's zero interest rate policy. really holdings the market up, we are long and we keep a big hedge on. it is concerning. the fed turned this market around because it let it be known that the rate is not going to be raised in march. you have to be concerned. i am concerned about the high-yield market. i think that is in a major bubble. you have been in the market for decades. ,hen you look back in history you assume history repeats
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itself, is there a period in history you can say i have seen this market before? where8 was the only time i was really worried the whole thing could bust open. that was the only time in my whole history i was nervous. the fed did a great job in saving it. is giving thed patient to much medicine and does not know how to stop the medicine. every time they start saying we are pulling back, something happens to the patient. the day is going to come when they can't keep doing it. zero,ep the fed rate at you can't do that forever because you are going to start having consequences that you can't even think about. >> i will give you a name and you will tell me -- tim cook.
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>> one of the best ceos i've ever met. >> because he listens to you? don't think tim listens to anybody. he listens to himself. i've met him once or twice and watched him. he's what silicon valley should have. they are venal guys, pernicious to the system. cook is on the other side of that. saying -- i think donahoe should have done it three years ago. how does a guy get away with it? he told that the
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new york post, i'm very pleased with what i've accomplished at ebay. he took away $5 billion from the shareholders and got away with it. you might be pleased, too. >> you got your wish, you got the four seats, now what do you think of ebay? >> ebay is very interesting. donahoe. i think donahoe wants to do a good job. he has made a lot of errors. -- the an error keeping error that was just made it now, which i think is more telling than most people know is he is out of the apple ecosystem. apple is going to make apple pay work.
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apple pay has a very good future to it. it,ou really understand that use beside mastercard and a few others. they don't use paypal. i think donahoe was crazy to go now, they should be involved with apple pay. he has made other errors. toughe going into a very situation with ebay. >> is this silicon valley euphoria? the money coming from the sky making you feel -- almost despicable what goes on. guys like the old alchemists.
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they take this crap and say they are making gold out of it. they try to get this reputation injur. like dell and like i said on tv before, they screwed more people -- that's what they do. i'm not going to hold back. stephanie having a tough time with carl icahn's commentary. >> amazing television. >> you can catch his full interview with stephanie ruhle this weekend. a great deal more than what we just saw. >> i assume it's already up on
11:47 am i couldn't not watch. i couldn't pull my eyes away from the screen. no matter you are a value judgment on what carl icahn has to say or what he represents, watching it is priceless. >> are hedge fund expert is still with us. thing that needs to be pointed out, part of the reason carl icahn feels free to say what he does is because he owes nothing to nobody. he manages his own money and that's it. he was not the right guy to ever run a public hedge fund. can you imagine somebody sitting down and saying you're bringing negative attention? you have to listen to quarterly investors. not anymore. he's got some amazing
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characteristics. he cut his teeth on twa. union. phillips, western traits from years gone by that he was involved in. two things he's got that i think make for asus x full fund manager -- a successful fund manager, he doesn't care. he will talk about how warren -- he's criticizing warren buffett. care deeply about a lot of things. shove, heush comes to will say what's on his mind about anything and he is deeply passionate. people have asked him time and time again -- >> this is his life. -- whens talk about
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carl icahn wakes up, he is working. when he goes to bed, he is working. the guy is constantly working all the time. >> i have been to their offices. has come it's he a small, collegial, couldn't be nicer in person. >> now is a family business. >> it will be interesting to see that transition to his son. thinkerery independent who is passionate about what he does. , a brilliant activist investor, clearly. carl icahn come a brilliant macro investor? i don't know. we have a neck served -- an
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excerpt from the conversation hiswhether janet yellen -- analogy was give the patient too much medicine . better macro a investor? >> where the macro comes into play sportfolio. play is he uses credit default swaps as a hedge strategy. think of them like a put on credits. stress,imes of market they will widen out and perform beautifully. the risk he has in that portfolio -- the kinds of names he rolls, the energy names, ebay , herbalife, the difference
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between the credit default swaps not widen out may when he gets hit in those names. , peopledoes something start heading up the door, he is the elephant in the room. he does have a basis risk their. do you think about his record as a strategist? when he goes to aol and says you need to break up or goes to tim cook and says give that catch back to investors or goes to donahoe and says you have to spin off paypal, every single one of those managers fights back and then two years later does exactly what carl icahn prescribed in the first place. to bere is no better way successful than to be right.
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you look at places where he's failed, he still made a quarter billion dollars and he "failed." we are going to take a quick break. "market makers" will be right back. ♪
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>> that is going to do it for "market makers" today. here.was a pleasure being
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thank you, stephanie ruhle, once again on assignment. has been a busy couple of hours. we are continuing to monitor what appears to be multiple gunmen situation in the capital of ottawa. the hour.ast here is scarlet fu. the turbulence of last wednesday, the s&p 500 has sense.every single day does that mean the volatility is behind us? joining us is the equity derivative strategist. the s&p 500 not only has gained every day, it has more than made up the losses from last wednesday. s&p showed a v-shaped for price action of the last two weeks.
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it sold under 16 and we are trading picks now that vix now as well. since then, the correlation sold off it shot up to 75 and now it is back around the 50 level. the markets back to where earnings are going to dominate individual stocks are going to be -- one of the most actively traded stocks today is yahoo!. shares hitting a one-month high. this is after third-quarter earnings topped estimates. what is the action you are seeing when it comes to options? >> yahoo! options have been busy
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for a week now. we were anticipating some sort of push move. a lot of call spread buying. we saw the numbers were good, but not really blowout numbers. there is a lot of work that still has to be done. what we are seeing today is taking off the risk of those call spreads. one trade i would like to note is the january, the selloff of 4550 spread. they were selling the call spread and buying putting 1% of stock. -- 21% of stock. --we want to stick with reports coming from the carriers .
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numbers from southwest and jetblue. you have a particular trade on one of those names. southwest. southwest,llish on but worried about the valuation here. trade ine a leveraged case it performs to the upside. 37,nt to buy the number buying the number 37 call and selling one each of 39 strike calls and 41 strike calls. around a 7%implying move, which is relatively quite high compared to how much southwest has moved in the past come around 3.5%. i'm a net seller of options and i want to plate using -- play it using out of the money calls. $.39, myock rallies to payoff is quite strong.
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>> let's put the chart up again. band. is within a narrow the stock moves ahead of that number command some point, you want to go into the underlying , too. post 41.t to give back i can't see how the stock goes to 41 from here. >> we are back on the markets once again in 30 minutes. ♪
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>> welcome to "money clip." i am olivia sterns. icahns investor carl sounds off at the robin hood investors conference. is wild aboutard business and wild about life. steve ballmer opens up on charlie rose. in politics, there is one issue one issue that politiciann


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