tv In the Loop With Betty Liu Bloomberg December 18, 2014 8:00am-10:01am EST
rally in stocks taking shape, thanks again to janet yellen, the fed chair he tries to give the world the best of both worlds. a rally was sparked yesterday and it continues into today. on a much enthusiastic front, sony has -- on a less enthusiastic friend, sony has canceled the release of "the interview," caving into the threat of hackers. it has hollywood of in arms. hacking, one year since target's massive cyber attack. is it cyber war? is cyber war the new cold war? have we learned anything in the past 12 months? worst, a look at our top stories. a global rally taking place. give credit to janet yellen and the federal reserve your janet yellen said the fed will be patient when it comes to future interest rate hikes here that sent u.s. stocks up 2% yesterday. futures indicate that there will be a positive open.
the s&p, dow, and nasdaq all healthfully in the green. .n europe, the major markets up asian stocks closed higher, as well. vladimir putin is trying to reassure russians about their struggling economy. at his annual press conference, he predicted the current prices will last two years. he criticized the central bank for not moving faster. pretend lanes outside factors -- vladimir putin blames outside factors. >> this is caused by external factors, first and foremost. but we believe that a lot has not been done by us of which we planned for our economy. >> you would expect him to say that you he accused the u.s. and european union for trying to undermine russia with the sanctions. he says it is response will for 25% to 30% of russia's problems. toece is one step closer
early elections. the greek prime minister failed to get enough support in parliament for his choice for president. there will be two or chances. if he cannot get support, the parliament will be dissolved. opening the doors to cuba could be a bonanza for u.s. businesses be a obama says he will normalize relations with cuba, easing restrictions on trade and travel. american companies would be allowed to export telik on commodities, and building materials. the president told abc news he knows his decision when the completely popular. >> if you are a cuban exile and you saw, you know, your families driven from a country that you feel you are going to strongly about it and emotional about it. there are people who are friends of mine who feel that way. is what i have said to them we have the same objective. we want to seek greater freedom,
greater prosperity, greater opportunity for ordinary people. >> the president is faking -- facing opposition in congress. senator marco rubio says he could hold up the ambassador or block funding of the embassies. andrew cuomo has banned hydraulic fracking for oil and natural gas after the state's health department said fracking cannot be done safely. fracking is now allowed in it least 32 states. back to our top story this morning -- for investors, interest-rate increases are coming but do not count on any lift off until after april. that was the big news from fed chair janet yellen in her latest news conference. peter cook was one of the reporters who got the chance to question yellen and joins us with more on her press conference in the results. teacher, even on the message seemed to be loud and clear on interest rates and not anytime soon, the markets took it well. overall, economists said her
messaging itself was kind of messy and clumsy. >> it took a little time to get to the real news of the day, which is that there will not be an interest rate increase until april at the earliest. this is important because you saw that statement, out, first of all, and then the fed was committing to be patient, but at the same time it was not dropping the considerable time language. there was confusion with the statement. it may have been clumsy, but to her credit, janet yellen did provide clarity. it took a while it she said it will be a couple meetings until they raise rates. then she said a couple meetings means, you know, two. why they cannot have said that in the statement itself will be one of the lingering questions from this press conference. but she did provide parity, the fed will raise interest rates in 2015 here at everyone better be ready for that. , asill depend on inflation well, and how low it gets. whack's i know you also pressed her on what happened after interest rates --
>> i know you also pressed her on what happens after interest rates rise. how quicklyoking at rates will move after they go up or that is one of the big questions here it i tried to get her to weigh in on the measured pace from the last tightening cycle. the 25 basis point increases we saw under the greenspan fed. there have been questions about whether or not the head can move in a similar fashion or whether she feels strongly about the pretty clear she is not a fan of a major pace. >> i have seen quite a few people looking back on the use of that language in the -- i cannot remember if it was 12 or 16 meetings where there were 25 basis point moves. we would probably not like to repeat a sequence in which there was a measured pace in 25 basis point moves at every meeting. i certainly do not want to encourage you to think that there will be a repeat of that. >> that means less addictive
bill of the -- less predictability arguably. they could sit on their hands to see how inks shake out. that is the message she wanted to convey. she wants flexibility to the fed. i think she probably got it after the news conference. >> thank you so much, peter cook. let's return overseas to vladimir putin's speech. it just ended a few moments ago. it was carried live on tv around the world. putin voiced confidence that the plummeting wrubel -- r uble will recover. as he spoke, it did that. his marathon speech just wrapped up. .yan chilcote joins us now this was a wide ranging press conference. putinexpected, vladimir blamed outside forces for russia's internal problems. it isaking of the ruble,
interesting that it strengthened almost despite the russian president's comments. it is important to keep in mind that this was the first time that vladimir putin really weighed in on his country's currency crisis since it went into hyper drive earlier this week or so it was important to hear what he would save your to that end, he really said absolutely nothing that was supportive of the ruble. he said it was important for the budget to pay people that needed to get paid. but nothing that would drive up the ruble on its own. have a listen. we will is no doubt distract all our social undertakings based on reserves we have to the central bank reserves, $419 billion u.s., the central bank is not going to waste those reserves. >> he sort of criticized the central bank of russia for not stopping spending its reserves
earlier. he also said -- there has been a little bit of talk over the past couple days that the government should compel the big exporters, the companies selling nickel and oil and gas, when they repatriate the dollars that they sell it for, that they should have to convert that into rubles .uickly to support the ruble he said he was not a very big fan of that. it is clear that vladimir putin is pretty much fine with where the ruble is right now, i think. part of the reason for that is, and he said this before, a weak ruble helps russia meet its budgetary requirements. >> there is this first russian billionaire to be arrested. it raised some eyebrows. yes, it is an interesting story. he was the owner of the big oil company in russia. he was arrested a few months back on charges of money laundering. then he was put under house
arrest. a lot of people saw this as a raid on his possessions by people close to the russian president. yesterday, he was unexpectedly released. the timing was just before the president's press conference, and that was lost on no one today, when the russian president was asked about it, he even said he was going to invite him to a meeting and that he is not been proven guilty of any money laundering. these shares in mr. evtushenkov 100%lding company went up at one point that he did lose his oil company and he was a double-digit billion air at the gaining of the year. he has about $1 billion now. >> all right, thank you so much. he takes on a lot of topics, including his love life, during this press conference. ryan chilcote, thank you so much. moving and shaking this hour --
overseas, north korea' as leader kim jong in. sony has decided not to release "the interview," a comedy about a tv crew sent to kill the korean leader. sony backed off after hackers threaten violence against any theater showing this movie. the film will have cost sony and fortune. $80 million to make and market "the interview," and that does not include the money the committee will spend to redo the computer networks. u.s. officials planned to announce this week that north korea was behind that cyber attack on sony. while tensions may be heating up with north korea, they are cooling down with cuba. president obama announcing yesterday that he will listen the more than half a century old trade and travel embargoes against cuba come effectively wiping away one of the last political traces of the cold war. white house correspondent phil mattingly joins us with more.
the administration is making a number of changes here. does the white house point to any of those as most important or are they all important right now? >> the establishment of relations, the establishment of a bigcy and havana is deal. on the policy side, the telecommunications part of this, u.s. companies selling telecom, and them opening up the internet a little bit, that is a key component of the broader u.s. foreign-policy under this administration. they want to reach people, particularly younger generations, and they feel like this is a key issue. if they can figure out a way to expanded within the country and also work to capitalize on it, younger cuban generations will be more inclined to be supportive of the u.s. it is a long-term project that one administration officials have been pointing to is one of the biggest pieces of this. >> not too long ago, i remember gonzalez case in
florida. it shows how the u.s. feels about cuba. but there are critics to this decision by the president. >> strong could experience there at two part spirit one is the prisoner swap at three cuban agents were swapped for one u.s. intelligence as that in the country. and there is the broader foreign policy, yediot of capitulation to cuba. what has the castro regime done to deserve this? there will be a lot of pressure from congress and the administration. keep point, with the president did is within his executive authority. congress would have to pulled on the broader trade embargo. what the president did yesterday, very little congress can do to stop it. >> thank you very much at staying with cuba, it was the first thing a lot of people started talking about after the president's announcement -- you got it, cuban cigars. you may now get some good but investors agree, when it comes to the fed, patience is a virtue. ♪
>> this was the word they got the markets moving, the word of the day -- patience to janet yellen used it to describe interest-rate spirit she said the committee judges that it can be patient in the beginning to normalize the stance of monetary policy. i want to bring in carl tannenbaum who study financial risk at the chicago fed and the federal reserve system in washington. good to have you back on the program. i was saying to peter cook earlier, the initial take on wasen was that her message clumsy, kind of messy, before she got to the real point. did you feel the same way? >> she does not have the polish that perhaps other central bankers do, but i think she got her point across. let the economic outlook evolve in a proper manner, patience with what is
going on in the financial markets and with russia, and also patience with her own committee in which there seems to be a diversion's of opinion. i think the fed did a nice job of saying it remains focused on long-term fundamentals for both inflation and employment here in the united states or by those metrics, the choice to begin making a small step towards tightening interest rates was the right one. >> before she does that, it sounded -- by the time she does that, it sounded as if it was not going to be until june. would you agree? >> she went out of her way to say would not occur in the next couple of meetings. others on the committee have sort of centered their expectations around the middle of the year. of course, there is a lot that can go on between now and then. she took care to note, as always, that their decisions are data-dependent. in our view, having some of the uncertainties in the outlook him a likely the latter half of the year will be the jumping off point. that markets should perhaps not focus so much on the first step
but how the rest of the progression will look. i thought she did a nice job of suggesting that it would not be the stair step that we saw 10 years ago and that they would be very cautious and review the consequences of their actions. you say, a lot can change in the next several men's including -- what else? oil. change in the next several months. let's talk about oil prices. >> the decline we have seen in a netices is likely to be positive. it is something that is certainly good for families, for households. it is putting more money in their pockets, having to spend less on gas and energy. so in that sense, it is like a tax cut. it boosts their spending power. ,> would you agree that perhaps, oil is a net positive, and it is not also going to
lower inflation expectations? on the first front, certainly, it is a net positive for the united states to while we have a burgeoning energy industry of our own, we still do import oil. to the average consumer, this has been a nice benefit here at the holiday season. it should boost consumer spending going forward. it is also fair to say, and the data show it, that falling energy prices are correlated, at least, with market-based expectations of lower inflation. but some of the survey data of professional forecasters or consumers have not shown such a big shift in inflation expectations. the fed's economic rejections show their long-term inflation expectations have not changed all that much -- projections show their long-term inflation expectations have not changed all that much. it will find a new equilibrium, and then price increases should be more normal. >> there are critics, and among them is bill gross. awares the fed is not as
as they should be of some of the macro factors. he was tweeting out several times during and after her press conference. one of those tweets i will read to you -- he said -- yellen and her fed seem fixated on historical models and less sensitive to current leverage, oil, and global imbalances. oil prices, historically, can be very volatile. in addition, some of the fundamentals that have brought europe to the brink of deflation are not present here. we have much lower levels of unemployment. raises are starting to rise -- wages are starting to rise between should be con this end of the global forces, but i do not think the fed should be overwhelmed by them. >> what about russia's influence question at what if russia continues to implode? >> great question. chair yellen took care to note the limited nature of our trade and financial relationships with russia. the thing we should be concerned
the second order types of affect spirit europe is very exposed to russia in some spots. if the contagion begins that way, it could get closer to our shores and attentively affect financial stability, something to watch out for. >> thank you so much for joining us. carl tannenbaum, chief economist on the fed. much more on the fed. vladimir putin wrapping up his marathon speech. some western automakers say they have had enough of those wild swings in the ruble. we are going to tell you how they are responding. and amazon raises the stakes in delivery war spirit customers in manhattan will now get a one-hour delivery service. in one hour, you will get your goods. i will bring you the details. ♪
>> you are watching "in the loop " live on bloomberg television and streaming on mobile and bloomberg.com. i am betty liu. general motors and jack wire on to avoid becoming burned by the ruble' is collapsed -- general motors and jaguar. russians have been snapping up foreign-made cars so they can convert the ruble savings to something tangible, something they can hold onto. amazon is now offering one-hour delivery for some products in manhattan. amazon plans to roll out the prime now service to others it is next year. among the products included, toys, books, and what amazon
calls daily essentials. more questions about the way uber screens its drivers. a boston man who works as an uber driver is accused of raping a woman waiting for her ride. uber has had lots of questions about its background check policies. 26 minutes past the hour, so bloomberg television is "on the markets." equity futures holding onto gains but coming off a little bit from the highs of the session after the fed meeting yesterday in which policymakers said, yes, they are going to raise interest rates, but they becauseng for patience it does not seem like rates will rise any time soon, at least the next six months. s&p futures up over 1%. "on the markets" again in 30 minutes. russian president vladimir putin addressing the nation and world in an annual press conference this morning. he pointed outside factors and also admitted russia was
responsible for solving its own problems. this has been provoked by external factors, first and foremost him a but we believe that a lot has not been done by inof which we planned diversifying our economy. >> with me now is paul saunders, coo at the center for natural interests where he heads the u.s.-russian relations program, as well as projects on energy. , we hearderesting what we thought we were going to hear, which is that he is blaming the west for what is going on in russia. but he seemed to go out of his way not to really address the 's collapse. why is that? is in a i think putin very difficult situation. on one hand, you know, he
certainly needs to try to use the situation to make some economic changes in russia. knowon the other hand, you , he does not want to take too much of the blame himself for the situation that russia is in now. , foren as he was saying example, that, look, we do not really succeed to the extent we wanted to in diversifying our economy, he was also saying, well, it was not really so much our fault because, of course, the energy sector is the most attractive part of our economy, so why are we to blame if that is what people want to invest in? >> what will he do next? will he get more hard line or will he back down? >> well, you know, his main message to the russian people in the press conference appeared to be, look, relax, don't worry, i got you through the financial get youn 2008, i will
through this one and we will do the same thing. the real problem for putin is a problem of time. of course, in 2008, oil prices actually bounced back relatively quickly. if they bounce back relatively quickly this time, then maybe he will be fine. if they do not, then russia will be in a very difficult situation. yesterday,re told look, there is no exit plan. is there to stay and he will live and i in the kremlin. but he might back down if the elite starts to turn against him. what would make them do that? faces two putin pressures. one is from the elite and one is from the russian people. his basic social contract with both the elites in the russian
andle rests on prosperity the continued flow of money. certainly, the longer this situation goes on, the more pressure he faces in both directions. is, yoution, i think, know, whether putin would back down, and what does backing down actually does it mean changing policy in ukraine, which most russians back? i doubt it. the austerity program assuring foreign investors but would probably alienate russia, probably not. >> thank you so much. we are getting breaking news right now. paul saunders. breaking news, jobless claims are out. -- nt to
, a job ofn estimated 6000. the level is the lowest in six weeks since november. the forecast is 295,000. claims,saw continuing the four week average coming in lower than estimated. point one weive look at the data. this is commensurate with what we have seen for the monthly jobs report as well. like there is some hiring going on out there. >> ok. how the nba might beginning shelter to one important russian billionaire. thing on cubanig
vladimir. and theece of megaphone collapse in the stock market of megaphone price, he has fallen off his urge. vladimir, the chairman of that company. click yes. his big benefit here is that it >> yes. -- his big benefit here is that it is cash. the $19ion after billion in dividends. this guy is basically sitting on $7 billion cash. parked offshore, naturally. be meeting with some of russia's most important business people tomorrow.
i imagine these guys will be in the same room with them -- with him. we are discussing earlier whether the elites like these folks will turn around to putin and say, wait a minute, you were supposed to help me protect my fortunate help me get richer. look at what is happening. how much pressure will be on him? went back on these guys. he basically said, you purchased these things and unfair price. we want it back, bring that money home. basically, i will let you have your fortune and you need to take care of things at home. there is still the sort of tension. when this first half -- first happened with sanctions in march, they said, listen, there's only so much pressure to put on vladimir putin.
because he actually holds all the cards. >> there is clearly a push and pull here between the richest and also putin. speaking of some of the richest, one of the top 10 richest billionaires in russia also owns the brooklyn nets here, and the nba has actually helped him protect some of this as well. >> they each internally -- each internally value -- each journal the team.ly value that element of his fortune has propped him up a little bit. he cannot get the net. -- nets. >> thank you so much. on to our other story,
rejoicing, tobacco products are among the goods allowed with cuba. will it start to lose some of its feel? joining us from our atlanta studio thomas written on this, and 80 smoke some cigars in his life, who knows, how much of this was built on the fact that you could not get any legally? yesterday i talked and he said, a lot of it is just scarcity and scarcity is just a man. -- just demand. couldwas a time when you bring some in but that was lifted a few years ago. these newre seeing regulations coming down in an f couple of weeks, people will be able to bring $100 worth of these at and more people will be
able to travel to the country. to they will only be able bring it back for personal use. >> right. will not be a flood of them coming across the border. part of the appeal is that you go to a tax room in some places and you buy some of those cigars and you get some of those. penalty forat bringing in illegal cuban tobacco products. >> it is pretty stiff. if you're caught now as an individual, you pay up to a quarter million dollars in fines and pay jill finds as well. corporations can face up to $1 million in fines. it is pretty steep. a lot of those restrictions are not going away. but it said anywhere from 20-30% arehe cuban cigars who
actually the main there, a lot of counterfeits are there as well, actually made their way into the country. sitesn find internet where you can buy $600 for a box of 10. $5,000 for as much as because of the scarcity we talked about. >> this will not only offer a trade for cigars, but companies are ok with this new announcement. coca-cola may be one? yes, this is an economy stuck in 1960. companies are looking for the opportunity to go there and sell the product. coca-cola has a long history there. working for coke, she fled in 1960,ap -- he fled in came here, and became a ceo and taking the stock rise to an all-time high. it is kind of a special place for coca-cola. eager for pepsi to get in there
and theirregresses relationship becomes more where the embargo is lifted, where they can go in there and operate fully. it opens up a considerable market for them and cruise lines, people who make tractors. a lot of consumer countries will watch this very closely. you can bet they have lands on the shelf on how to attack market fully. >> thank you. got breaking have .ews right now. a new ceo julie hyman has more. >> the chairman of the board of directors will take over as ceo from tony vernon, who had set -- shepherded the company ever since it split. it happened a couple of years ago. tony vernon will be leaving the company as of the end of the
fiscal year. is previously the chairman and ceo of pepsi bottling group. he has been in this consumer pack -- package products business before. he will be taking over as of december 27. tony vernon will stay on as senior advisor and will also remain director until the company's next annual meeting next year. >> julie, thank you very much. still ahead, stephen colbert filed his last report on comedy central tonight. a look at the changing faces of late-night television. weighaking to twitter to in on sunny patches decision to .ancel the interview,
>> today's bloomberg big number is $200 million, what a hack attack could cost sony. sony canceled a movie because of threats from hackers. million. then the computer network lost and damaged -- the private security firm. it is estimated that may add up to more than $100 million. more on this view about sony canceling the movie. joining me now, the director of research at a rising media here -- media. >> it is unprecedented. if you are a proponent of the first amendment, you can say -- >> how can they do this? it is self-censorship.
>> it is. there are some concerns about people who go to movies. attendance in movies is down this year. err probably feel they will on the side of caution. it is christmas day. probably a lot of factors went into that. what is surprising also is a will not distribute it. the big media investor tweeted out, watch it on ott. but comcast says they will not allow that. >> whatever group at sony and -- otherng people company's website, and getting unflattering comments made being public, and you run the threat of other terrorist activities with these companies that decide to distribute it. it is not surprising sony will probably have a right off of
$200 million. >> that is huge for sony and a studio that has not had that many hits and has and struggling. it is an upfront cost to them. what about the longer-term cost for sony? >> typically, a movie studio breaks even in the theater. that.tflix now is part of it is generally where they make their profits. obviously, none of this will happen. it has been a tough year for movies, but next year looks really good. the star wars trailer had 40 million views in three days. the terminator. >> so they can get through this? you think so? >> yes. another type of movie about north korea that was in development with steve carell, they just scheduled that project.
basically, lesson in hollywood, stay way from north korea. >> for the time being. >> as long as they do not stay with him star wars. -- stay away from star wars. i want to play a part of what stephen colbert said last night about his show. >> tomorrow, i will conclude my final broadcasts, say my final farewell, angry adios, and my lukewarm later, and walk out. then everything in here will be shredded and sold as industrial meat filler. >> ok. however, he is stepping into letterman's shoes. so he says farewell and hello to late-night. >> the biggest damage to late-night has been the dvr areback. 8.5 million people
on their dvr's between 11:30 and 12:30 every night. a very competitive time. it is a great time to watch and catch up with their favorite shows that they missed. that colbertng is is very good with streaming. very good online. have seen how popular jimmy fallon is and jimmy kimmel. conan o'brien just had one billion views on his youtube channel. you have to look at this long-term. audience erosion, and people who are watching broadcast television. all these late-night shows in broadcast tv are in their 50's. letterman is 66. 67.
the audience is a little older and the younger -- the younger folks are the ones going around watching the little clips, the some ofop quartet and the other topics. the other guy replacing craig ferguson is also very good at this. many -- hend of like is unknown, but he can get a and fergusonn cbs by 1.2 million viewers, but if he can get a presence online and streaming, that can be financially leveraged their yellow thing is cbs will own these shows. this will be cbs's own show. something very important for cbs shareholders. >> thank you so much. great to see you. much more ahead, a bad day for one billionaire.
>> bloomberg television is on the markets. equity futures are higher. after theyd higher came in a little better than estimated. fewer people filed for claims than last week. ec futures up now over one and a quarter percent. inare on the markets again 30 minutes. coming up, one year since target announced a massive data breach. we look at the known -- the new normal. not a cold work, but a cyber work. you are watching "in the loop."
>> welcome back. we are 30 minutes away from the opening bell. look at the top story this warning. a rally after the fed said it was so patient on interest rate hikes. falling to a six-week low. and who is the bad guy in a crisis? vladimir putin says it is a u.s. and european union together. the russian president held a conference today accusing them of helping to undermine russia. at the same time, trying to reassure russians of the threat of inflation and recession. long will this take?
in the worst possible scenario, it will take around two years. after this, growth is inevitable. economic factors will change -- the growth of economic >> he criticized the bank, saying it should have acted quicker. the greek prime minister, whose candidate for president cannot get enough votes. and cannot round up enough votes by the end of the month, they wind up holding early elections. back in the u.s., a new ceo, the company's is nonexecutive chairman replacing tony vernon, who is retiring their last month, a sales declined. includes miracle with and phil vida. movie "theng the new interview" will not be cheap.
sony pulled the movie after hack and -- hackers threaten violence for any theater that show the movie. we are showing clips of it. , hitting minutes away our radar before the bill. matt miller and olivia sterns. lossfore we move on, a sad that sony is throwing in the towel and letting the terrorists win. i do not understand this utter failure. >> we will talk about that. >> good. >> number 10, more problems for consumers in japan. yesterday, we showed you this mcdonald's french fries shortage . andcan only buy small fries not large. you are not limited in japan to just two packages of butter each ahead of the holiday season.
>> it serves them right. it is their own policies. perhaps there is a pressing , >> i like some of the reasons for why aging farmers and rising costs in trade, but also stressed out there accounts. >> right. they're overworked because they have these massive tariffs that have any dairy coming into japan. so they have to work as hard as they can. >> i do not know how i feel about that. number nine, mcdonald's rose the most in nine months. world'serman said the largest restaurant chain could be managed better. he said this on our program, on our network their feelings adulation that he will buy a stake and push for changes. here are the exclusive comments he said yesterday on "market
makers." >> are you sure you do not want to say what you would do with mcdonald's? >> i am sure i cannot comment. >> the stock went up 3%, just based on what are really pretty mild comments coming up. >> so they need to appoint 23 euros to their ports? we love and bill ackerman comes on bloomberg. he always almost shares these exclusive details. if you are smart enough, you can assess out what he is doing. classic scenes i give any company needs an activist push right now, it would be mcdonald's. eight, president obama. it could mean new business for
companies such as carnival, nike, coca-cola, walmart. also, recruits for major league baseball, the most popular sport in cuba. >> baseball all-stars are growing like weeds in cuba. >> i do not care if walmart or kmart goes cuba. it is not interest me. more importantly, you can go down now and license cars and bring them back. and other thing i am not sure about, they make delicious from. i have never had cuban rum, but i would love to get some of that. >> is this a statement on us americans that, given the historic nature of the announcement, the only thing we care about is cuban cigars?
havana ando visit check out all the old cars. how awesome? i'm uber excited by this. the people who hate cuba the most in this country are cubans. backed byseven, warren buffett, plunging 21 -- 29% in hong kong trade. they said they got calls, why is your stock going down and they said, i do not know. .own 30% they are nottopic, doing that well either. >> it is being valued as an election car company. tesla is valued at 72 times earnings. it still had a great run, but it is not valued like that.
valued carmakers are eight or nine times earnings. made this choice. maybe he has not played out yet. it is not a daily business for them. if they can crack the chinese market for electric vehicles and tesla cannot, they will obviously sort. >> i just got a 10% stake in the country. but he gets the most attention because he did buy into the unusual investment. staying in autos, uber will determine where greater than in safeties is required. and instanthecks, response teams also provide some support. after backlashes on various and includingncidences, an uber driver who has
apparently raided a passenger in boston care that is the latest case. >> terrible news and terrible allegations. the issue is, does uber want to do the same background checks? if so, it is hard to and it on uber. uber drivers in new york city are given the greenlight by the medallion company. the samey are given background check. it is for sure a horrible story. if it is true, it is awful and probably the guy should be given the death penalty. a taxidriver, we might not be talking about as much. taxi drivers do this kind of thing occasionally as well. .eople of all walks of life >> how much is uber responsible for this? it is the same question you ask about facebook or twitter when someone commits a crime or say they will commit a crime on facebook or elsewhere, how much is the company itself
>> we continue our countdown to the opening bell and we are more than halfway through. one year ago today, target plus massive data breach sent shock rate -- shockwaves throughout the world. a series of other cyberattacks on major u.s. companies. home depot, jpmorgan, and sony is the latest company to fall victim to hackers and not lead a trove of embarrassing e-mails. they also send to attack theaters and now that has been scrapped. the founder and chairman of identity that 911, a provider of
data breach and identity theft recovery services. we were just talking. -- it is incredible when you read through the details, how vulnerable sony was in the first place. the company was so volatile, it essentially said, here is our server, his name is bob, and the passage -- and here is the password. and yet, it was an incredibly sophisticated attack. it was a carrier -- it was carried out, really, and work of art by the folks who carried it out. >> lifted sony do wrong? several things, but what did they do wrong? believe other companies to the same errors. >> 90% of companies in america could not have withstood the attack at all. you have to start with the
premise that hacks have become the third certainty in life now. this is the way we're going. companies need to have a completely different way to think about things. by breaching a subcontractor and here, there was a massive attack on sony. they may have had inside help because these folks went into every nevada cranny of the system of sony. they knew. the problem was they had things passports and databases not encrypted, in plaintext. even want to go through all the insanity with .he information this was a delicious feast for
the media. >> now they're actually adding on more resources to it? >> some are. there are companies still making what i think is a very foolish announces, saying it costs us less to do with the results of a breach and to do the security. for instance, we are hearing more that there are information security departments, as opposed to just i.t. departments, that there is just more sophisticated software and more sophisticated testing, where they are now requiring reports not just to be capped at the i.t. level, but these reports are now to see sweet and also to the board, because this now has to be a board problem. >> what about target? we learned a lot of things from target, but what did we change
specifically on the retail front after the target attack? >> retail has not been terrific at storing data. they spend more money trying to get you in the store than to get you information and they kept it for too long and things like that. happened is not only are more and more retailers trying to clean up their act even though a lot of retailers have been hit and it is estimated there could be at least another thousand retailers out there who have problems, but now we are finally shifting technology for credit cards. we had been using magnetic striped bass credit cards. we are literally one of the last countries in the world to go chip and 10. it proves it will significantly reduce card fraud. and we are only now putting in. >> is interesting. i got in the mail my american
express card and the new one has a ship on it. they are finally starting to wake up to this. >> they said if a retailer has not shifted, and a shift of signature, that if there is a breach, the liability will fall on the retailer. as a result, that is always a motive. that is leather has been a problem. it is a whole issue of money. they did not want to issue a card where the retailers do not and to put in the readers, this is just a continuing fight. the reality is, things have to change between business, government, consumers, and media. we're all in this together. this is very serious. shivers downend the spine of every leadership group in america.
>> welcome back. let's get back to bringing you the most important stories you need to know before the bell. join me.erns we were just talking about the cyber attack with target and with a response to that and a threat by north korean hackers, sony has given him. , thecanceled the interview seth rogen led comedy. >> all you need is computer skills and know-how to dial 911 to get what you want with sony. gigantic, was he wussy move.
if north korea can do this, anyone can do it. come on. side. me take the other there were threats of bodily harm. >> anyone can make those threats. fax number two, is it worth it over a seth rogen movie >> first of all, yes. have you seen pineapple express? >> it was a big investment for them, but i agree, they threaten bodily harm. >> you cannot give in to terrorists. if you start like this, who knows what happens next. >> number three, a russian billionaire cheering for the brooklyn nets. the tycoon bought the team for $225 million.
it is apparently worth $2.7 billion. and he is protected at least a little bit. and is is a great story do not know if it was off the lastd or on the record week, he said, look, these russian oligarchs for a decade have been wondering money and getting ripples out. they do not care how much they pay for these assets. does not matter to them if they drop 50%. this guy made a lot of money in the deal, but the point is, they need to get the money out. >> and obviously fueled huge london, worthoss 100 billion pounds. you cannot fault him for wanting to own the next. -- nets.
and remember he ran against him for president. >> i would not call it money laundering, but there is an overall problem with them and others who have too much money. ikea stop selling products in russia. ikea being the latest. holliday told me this were able topeople buy $50,000 audis for $27,000. when it collapsed, the severe, you get extreme deals. click they were able to
>> bringing you the most important stories you need to know before the bell. number one, we have to talk about the fed. janet yellen pledge and -- pledging the banks will be patient when it comes to raising interest rates and will likely keep rates near zero. remember, we were talking about this a few days ago. bloomberg put out a survey among economists and they hinged on that word, patients. something was brewing in the market and there you go, in the release, that was the word. >> on surveillance this morning,
he made a great point that this kind of trickle-down monetary policy, if you will, takes time. the big mistake, from his point of view, would be to take their foot off the gas now. these things, the benefits are finally tricking -- trickling down to people who are not rich stockmarket investors, and they have got to leave that for a full recovery before we finally see wage increases. >> we are continuing to move toward full employment. it seems like the economy is heading on the right track. >> citigroup said, the more you explain it, the less i understand. i think that sums it up. >> ready to kick off on a high note thanks to janet yellen. i want to bring in the chief investment strategist of blackrock. rather than us talk about what
janet yellen said, let me just play part of the news on britain's, comments she made yesterday on rate policy. >> in particular, the committee considers it unlikely to begin the normalization process for at least the next couple of meetings. this assessment is completely data dependent. if incoming information indicates faster progress toward the committee's employment and inflation objectives, then the committee now expects, then increases in the target range for the federal funds rate are likely to occur sooner than currently anticipated. picking herrefully words. what exactly was your against takeaway from the conference yesterday? takethink the biggest
away, everyone focus on the word patients and how you compare that to considerable time. the fed is trying to extricate itself from unusually low rates, but they have leeway. one reason they have leeway and can exercise patience is the fact that we have seen a decline in expectations, a decline in realized inflation, and even economy we robust are experiencing, which is a good thing, they have time. i think the fed will probably go sometime next summer, but they can be measured in how they approach this. >> what really changed? she basically said what the market expected. why did we see this triple digit rally? >> i will pass this one to you. i cannot answer that well. >> i was not asking you, matt.
>> it was less what she said than what she did not say. absorbing a lot of bad news, a lot of body blows. what you have is a continuation of dovish policy. instances, aother dovish fed is making up for a lot of at news from europe and other parts of the world. this is why you have a rebound rally. >> maybe we will see this volatility continue. 200 points things may be the new normal. >> i completely agree. it is not so much that volatility is spiking. we are going back to normal. that is the key word. going back to that 20 range, that is where it needs to be. we had an unusual time of low volatility. as the fed normalizes, volatility should normalize as well. >> anyway you cut it, there is a's dagger and golf -- gulf --
there is a staggering gulf. how do you explain the enormous disparity? >> i think you will see the market probably start to adjust with the data. the reality is, the market is skeptical for a couple of reasons that are reasonable. one of which is that the fed has been very optimistic throughout the recovery at least in terms of their official forecast. that is one reason the market is a little more dovish than the fed. the second is the market does not count them all the same and they are putting more weight to height chairwoman yellen, with the belief she will take her time to the extent that low inflation environment persists and the economic data does not force her hand to act more aggressively. >> what about overseas? you see prices early. china is slowing down. growth enough to continue
the rally in the markets and some of the small implosions we are starting to see? much theynds on how implode. the u.s. can certainly withstand the slowdown in china, as long as it is a gradual slowdown, which is our expectation. i think the risk in 2015 is less draggingna or europe us down through slightly slower growth. it is more about the potential for shots, whether that comes from european politics or russia or some other source. that to me is a bigger risk than the fact that you're seeing a slowing in china. now, everyone knows that will happen in china. now, the logic has been, everyone wants to buy in, but now suddenly the british papers are writing about greece and thethe euro
collapse of the russian economy is. what is your take? ecb -- they will help the european equities. we had a year in 2014, which is where european politics were largely absent as a risk factor. that changes in 2000 15 not just because of the situation in greece. in see a similar pattern other european countries. italy, germany, a rising anti-european parties, more of a populist sentiment. that will focus markets once on whether or not european constituencies can keep them together. >> much more ahead.
>> let's get back on the retail front. nike reporting after the bell the holiday shopping season with disappointing results. some of it is due to the mild weather, but that might all change. ushave two experts to tell how consumers will behave just before christmas. , the author of how to shop in a discounted world. crunch weathero data in big retailers like walmart so they know what is in stock for the weather companies. good to have you with us. tell us what the weather data
is. what does it point to you on what retailers will sell going into christmas. chris going into christmas, we have -- >> going into christmas, we have cold weather. it has been very mild. that compares to the polar vortex of last year. the pattern has completely changed. it will all change and will become more seasonably cold. you throw on top of that the expected increase of traffic to your there are people out there getting ready to spend a lot of money. there will be a massive surge this week and going into the holiday. people will start buying differently because they will start buying things they had not been buying, which is outerwear >> shopping, they were
just not buying the cold winter clothes, essentially. now retailers have to stock up more and make sure they are prepared for the onslaught. yes. from a consumer and markdown perspective, a great deal, especially right after the holiday. >> so you are the king of this retail. tell us, will we see a lot of markdowns? yes we are, but it was makes me laugh. when retailers blame the weather for full sales, it is almost like a kid saying a dog ate my homework. enactrkdowns they will after christmas, sure, there is a little bit of weather but things get marked down because they were not good enough here they should have known a little bit. they should have listened to people like you a little bit. >> to be fair, retailers are getting more sophisticated in the way they are leveraging details -- and they are getting
better. but it is hard to be perfect. the supply chain systems that it is gradually getting better. with the onset now of mobile shopping and online, it brings all sorts of new ways to leverage weather. you are exactly right that the weather is traditionally used as an excuse and it is more and more becoming a really bad excuse. >> yes. the weather company has a partnership with walmart. you are crunching weather data for big retailers like walmart. tell us a little bit like, what are the scenarios you gained out for them. come in relation to the weather data you give them. >> in general, with all of our customers, especially on the advertising side, we work with them specifically to help them gain understanding with the analysis of data exactly how weather is influencing my customer. it can become very specific when it relates to demographic.
to you, in pointing here, for instance. 75 degrees, perfect conditions, sales are high, is that right? >> a walmart graph. walmart is famous years ago talking about the fact that the threat of a hurricane had on strawberry sales. that almost became an urban legend in the industry because walmart is so far ahead in terms of being able to understand how important data was to actually merchandising and marketing. they have taken that obviously both onlineew level as well as from an advertising perspective. >> i love that when there is rain or storms, stay sales go up . if you are walmart come you have to make sure your meat department is pretty well-stocked era classic ackley. what we know is that the forecast actually tries behavior. the way we use the weather forecast is to plan. if there is a prediction of a big snowstorm, an obvious
example of hurricane is it will shape what we buy and where we go. >> what about oil prices? we are seeing the oil prices are impacting the people driving to the store, more readily. they will make multiple trips. it will be interesting to look at some of the impacts next year. thatnot really seen softening. a little bit now and a lot later. haspeaking of retail, there been a lot of interesting news lately just ahead of the holiday season. does it getting booted out at american apparel, speaking of walmart, the chief of their merchandising unit before last friday. what is going on? >> the problem is retailers are facing a lot of new pressures, fresh pressures. they realized, well, we have to
integrate it into our business. old-fashioned retailers are coming back. and you have to get really granular. you look at the way the department stores are succeeding worldwide, the ones doing well, there are a lot more challenges. >> it is all about the local consumer and what they want. all right. thank you so much. great to see you. well fromthank you as the weather company. breaking news right now the king of consumers. the consumer confidence index just out now. julie hyman at the breaking news just -- news desk. >> we're seeing a seven-year high of consumer confidence. making a fresh seven-year high. i am not surprised here. falling gasoline prices, and as we have seen, and improving job market. you would have and improving consumer confidence as well.
>> a website called secureinvestment.com. before vanishing with millions of dollars in client money. bloomberg markets magazine broke the story and bill teamed up with them to track down the stolen funds. wanted tosomething he put money into and did not want to take it out of. >> the returns were so great. >> father of three david kane invested $2500 in the website. it promised massive returns, managing more than one everyday.
profit so good, people all over in may of last year, it is -- it vanished. we set out to find where it went. worldors all around the on why that hit. during the second half of 2013, more than $5 million flooded an account year, register to smart integrity limited. the company dissolved soon after . an office in london. comedy -- and the registered owner living in latvia. customers say they also lend money to accounts in louisiana -- lithuania. longer historic crossroads between east and west in recent decades, the island became a magnet for foreign money. >> money laundering is becoming an easy way to do things for
those companies because money laundering was a major problem. secure investment was no different. accounts used in the scam were closed by bank compliance individuals. they were forwarded that to the money laundering unit. that unit prosecuted nobody and the funds left. as the economy here teetered last year, the bank desperately sought new business, sometimes without enforcing the rules meant to protect investors. >> they are there. practicing attitudes, if you want.
their client and follow the procedures of the law. >> financial regulators have investigationswn into secure investment. the web of anonymous show companies and complex transactions will provide a challenge. >> it is like trying to chase a t in a windstorm. he will never catch it. who is going to do it? >> the u.s. department of justice has recently begun looking for those people, a process that may well lead them here to cyprus. >> the foreign-exchange scandal. that does it for us today. tomorrow, a venture capitalist joins me as guest host as long -- along with one of the founders of the venture capital world in new york. allen is joining me as well. that is all tomorrow starting at 8:00 a.m. eastern time.
>> it is 56 minutes past the hour. bloomberg television is on the markets. i'm julie hyman. let take a look at where stocks are trading 30 minutes into the session. another rally on our hands. one and one third percent on all the major averages. keeping rates low or at least until the second half of next year. take a look at the other things we are watching. larger than the overall cap, which is not unusual. crude oil is giving a little bit of a rebound theory the 10 year yield is rising.
eventually, the rates will go up. for more on the markets reaction, lisa, now that there period investors have gone through, what is the read on what the fed had to say yesterday? >> there seems to be a feeling that the fed is moving toward a plan of hiking interest rates around the middle of next year. that is actually a little bit different than what the market had been expecting heading into the meeting. they thought they might push back when they would start hiking interest rates. the statement was not clear. .hey are not coming out it was a muddy statement. they were trying to basically have everything they want. "don't worry, the economy is doing great, but we are not totally tone deaf to the fact that global warming -- that it is slowing,."
was one of think, the biggest points out of the whole conference. she said that patients meant a couple of meetings, which takes us to april. after that i'm a all bets are off. that is earlier than the markets were starting to price in. the biggest move we saw is probably the 10 year. at one point, the yields rose the most since september of last year. there was more volatility in the 10 year. reaction inso a big the high-yield market. >> that is not surprising given what you were talking to us about or sometime. >> absolutely. basically, janet yellen was laying the groundwork for a high-yield bond to do well. slow and steady growth here they ratcheted back, should they would raise interest rates next year. that is also good for high
yields. you also had oil prices. >> that is the fly in the ointment. the fed is also only going to be able to do so much. slammed high yields has been the bedrock in oil. >> this is the catch. the fed is not tone deaf to the price of oil. they did say they are watching that and are watching the decline. but they think it is temporary and not a long-term drop in oil prices. they seem to think that oil prices are rebounding. look more athey do a measure of inflation that does not include commodities. this is not unusual for them to discount the drop in oil prices pulling down consumer prices. keep an eye on it, as they do. >> ok. thank you. and i on fixed income. "market makers" is next. ♪ >> live from bloomberg headquarters in new york, this is "market makers."
>> turning up the heat on kim jong-un. the obama administration intends to blame north korea for the hacking with sony. how they italianate. guess who gets the blame, the u.s. and europe. >> follow the money, that is what bloomberg did. behind a foreign-exchange ripoff that cause investors millions. makers" here on bloomberg television. i'm erik schatzker. >> i am stephanie ruhle. >> let's take you right to the breaking economic news. scarlet fu is out. we have lead economic indicators. >> yesterday weaker than expected read for the month of december 24, half of what we got with the consensus of economists surveyed was the 26th.