tv In the Loop With Betty Liu Bloomberg February 23, 2015 8:00am-10:01am EST
and we are 90 minutes away from the opening bell. we are talking about the oscars and network television. we have two people who know the network tv game very well. bob wright and mike dolan both joining me in a moment. another day and another deadline. greece has measures. bellow funding will keep flowing if so. sippers -- cyprus told greece there is more work to be done. >> we want to battle that's we won the battle, but not the war. the real difficulties including those related to the negotiations in our relationship with our partners are still ahead.
>> cyprus says the new agreement wiped out previous budgets. it is murder monday. at pharmaceutical group has agreed to buy another four billion dollars in cash. valley and was stored in -- valeant was sorted from buying the maker of botox b. announcement will be made later this afternoon. a change at the top of dish network. charlie ergen is not going to be the ceo of dish at the end of march. he is replacing joe clayton who is retiring. they keep losing tens of thousands of subscribers while
they are investing up to $50 billion in wireless airwaves. that is his next big bet. a pay cut for the ceo of british bank which has been hit by lower profits and a tax evasion scandal. it has been cut 5%. the 2014 earnings fell 17%. the bank is dealing with fallout from a report on how it handled swiss accounts for tax evaders and criminals. the oscars went to -- drumroll -- bird man. and 14 oscars last night including those for best picture and best director. julian moore won the oscar for best actress for her role in the movie "still alice." >> thank you so much. i read an article that said that winning an oscar could lead to living five years longer.
[laughter] if that is true, i would like to thank the academy because my husband is younger than me. >> good for her. the best actor went to eddie redmane hoover trade stephen hawking in the theory of everything. back to business and greece. the greek prime minister has less than 24 hours. our international correspondent is back in berlin after going all over continental europe. what do we know so far about the proposals? >> we know very little. what we do know is the government has made announced they will talk about re-imposing a higher minimum wage. the minimum wage could be one area where there could be a little give because that will not directly add to the deficit. there is talk about labor reform.
the important thing out of athens this morning as they spoke in terms of red lines. these are commitments that the new government made to their voters. at the same time, there are red lines here in germany and berlin. if there are not enough specifics the eu leaders and finance ministers can vote this down in a conference call tomorrow morning. we have to wait and see what the document is and whether or not it will be specific enough, not just for berlin but also madrid and brussels and other capitals that want to see greece stay with their imf reform program. >> what about is being enough to satisfy the germans? >> that is the crucial issue. the key issue is how much specificity will we get tonight? there isn't a whole lot of optimism on why this will be different other than the fact that everyone came out of the meeting convinced that they
could potentially have a deal. there are a lot of hedges on that. the first is tonight and there will be another 14 months down the road -- another one four months down the road. there is also the spanish economy minister. it isn't just berlin versus athens. this is europe versus athens in some cases. >> thank you so much. the latest in washington, the obama administration taking a big fight with wall street over the handling of $11 trillion worth of retirement savings. the administration wants to change rules for brokers who give retirement account advice accusing them of putting their interests ahead of their clients. peter cook has more on how the white house wants to change that dynamic. they accused the brokerage industry of having charged excessive fees for years.
>> that's right. they suggest there is a conflict of interest for the last 40 years. the administration moving today through the labor department at the urging of the president to move forward with a change in the legal standard that those brokers need to follow going forward. the standard right now is a suitability standard. if you are offering investment advice to retirees use of we have to offer advice that is suitable for them based on their age and income. the white house says that is too low and allows for brokers to basically offer products or recommend products that give them a higher compensation and may not be in the best interest of the client. the administration is proposing this fiduciary. they have to put the client's interests first. it is a very big number and one
the wall street firms will challenge directly. the white house says this is a change that is long overdue and they are moving forward today. the president will talk about it in his middle class economics push. >> they hate this proposal and i have been fighting it for years. >> they have been fighting it for years. there was an initial proposal in 2010 i got tabled because of the criticism from wall street. they are making the case this will hurt retirees and limit their choices in terms of products available to them. they will say for folks with smaller accounts and lower-income americans who are trying to save for retirement that they may not be able to offer advice to them at all if the standard moves up to the fiduciary standard. they are making the case it will do more harm than good. was obviously a lot of line -- a lot on the line. they get a big cut of that right
now and terms of the investment advice they offer. this is a big deal to wall street right now. >> billions of dollars in fees collected. thank you so much peter cook. a big deal on the farmer space -- on the pharma space. a deal valued at $10 billion. valeant will address to its stable of offerings. they had a whole in this area and that is why they went after this company? >> right. salix is the leader in this gastro intestinal space. >> this is kind of a surprise. they bid so hard for allergen and they didn't get it. most people thought things would slow down here in the
acquisition front. >> valeant came out and said they will step back and focus on what we already do. the kind of came out of the blue with this. this has been in play for a long time. the question now remains whether or not they go after something else or stick with what they have. >> what do you think change their mind? other than the fact that this was a for sale and if it's a nice hole in their repertoire. when change their mind at valeant? >> they are notoriously inquisitive. they went with an experiment where they teamed up with an investor. even though they said we are happy with what we have and we don't need to do a deal, this is
a company of scale with a very good portfolio of products. they thought this is one we cannot afford to miss out on and so we will do it. >> will they do more? >> that is a good question. these guys love to do deals. they have said they will not. when they see something they like, they will move quickly and aggressively to get it done. if the right thing comes on the market, these guys are in. >> edit, thank you so much -- ed , thank you so much. moving and shaking this hour. warren buffett likes a deal. he is a ligety morris possibility to executives at berkshire hathaway. at least four of the recent acquisitions will be seen by his deputies. that includes duracell and a german mortar cyclic women retailer. -- german motorcycle equipment
retailer. who is going to take over for warren buffett? that has always been the biggest question at berkshire hathaway. the stronger u.s. dollar may be the final nudge acquirers need. a company has a presence in 150 countries and why the u.s. dollar is helping. a new leader is still an insider. much more on that story in a moment. ♪
greece has until the end of the day to come up with a new list of financial measures. some other stories making news. a series of recalls have caused the president of honda motors his job. the retailer was plagued by major recalls of defective airbags. here is his decision to step aside. >> honda is ready to make a hugely forward. i believe honda needs to overcome challenges under a new younger leader and team. that is why i have decided to be succeeded. more placement will lead a honda's six regional operations by expanding each region's businesses utilizing experience and knowledge he has a committed over the years. >> he led the company for six years at honda. security tighter today at the largest mall in the u.s. after a terrorist threat. and a video, a terror group
calls for attacks on the u.s. canada, and the u.k.. specifically mention the mall of america near minneapolis. secretary jeh johnson says the threats must be taken seriously. 11 students at lesley university in connecticut have been hospitalized after an apparent mass drug overdose. the students took the drug known as molly. one student is in quickly condition. those are your latest top stories from around the world and here in the u.s. the stronger dollar may be weighing on some company's earnings. american suitors are now getting more bang for their buck in other parts of the world and they are starting to take advantage of the stronger dollar. last week, we heard the u.s. beverage company ball corp. agreed to by committee for $6.8 billion. that is much less than it would
have cost a year ago. and joining us now for more with his perspective is mike dolan. he is the former ceo of img worldwide. he has served as the cfo of viacom or i am sure you had to take a look at currency fluctuation. >> we did. it makes you appreciate being in the united states. >> so the dollar has gained like 21% against the euro. you flip that around and maybe have had a fifth of a discount out around the world. is a make a difference for you? >> i think it does. maybe less so for bacardi because it depends on when you started internationalizing. if you started early, you already have made the acquisition and filled out the product portfolio.
if you are starting out late now and are looking to do acquisitions and international markets, the timing is putting good. >> are you looking to do acquisitions? >> where always alert to opportunities. we like to think we are alert to opportunities anyway. we feel the portfolio we have is pretty attractive and broad-based and has been around for years. >> is it hurting you at all, the stronger dollar? >> in general pretty naturally hedged so we are ok. venezuela and russia you get these incredible distortions. those are probably the two biggest markets where there is no natural hedge. >> what about cuba? i don't think we have had you on since the announcement was made by the white house that they were normalizing relations with cuba. mccarty famously kicked out of the country. you have your cuban heritage.
are you trying to get back into that market? >> it is too soon to say. these are the early days in the relationship. it is too early to call it in terms of which direction it will go. i think everyone hopes that whatever the outcome is that the lives of the cuban people will be improved as a result of it. >> you have a special link to cuba. >> we do. the company started in cuba. the rum is synonymous with cuba. >> it is in your tagline. >> absolutely. the parties have made a huge contribution -- bacardi has made a huge contribution to cuba. it is part of the dna of bacardi rum. >> you haven't looked at that market specifically? >> too early. we will keep an ion and see how it develops -- we will keep an
eye on it and see how it develops. it is like hedging currency. a natural. -- onunnatural. we would like to see more concrete performance by the cuban government and responses by the u.s. government. >> before we go, there was a great profile written by bill cohen, a contributor here, on the merger which you helped put together. it outlines your relationship with mark mcdougal who apparently you fought with over the direction. let me read you a quote that bill had. you said " i was sitting there
waiting to collect a check from the sale of the merger and he still didn't have the balls to say it will not work out and we wish you well." >> this was a very entertaining article. there is a lot and it that may be true. >> that wasn't? >> i don't recall that specific line. i think they did a very entertaining job of taking what is a business story and making it into something -- >> it sounds like a hollywood script. >> it does. it is something the average person would be interested in. >> the former ceo of img and the ceo bacardi. before you want to take a good to disneyland, you'll want to hear about how much it will cost you. it is three digits now. they are upping their park fees. upon takes a bite in europe with its biggest investment there. what is the tech giant building
>> you are watching "in the loop " live. good morning. i'm betty liu. today's big number. $105 is how much it will cost to get into the disney's magic kingdom now. the basic $100 barrier for the first time ever. changes when it to affect on sunday. they include a 3% rise at the other three resort parks in orlando, florida. disney has been investing $5 million in its parts over the past five years opening new attractions and doubling the size of magic kingdom's fantasyland section.
attendance is up 3% over the last fiscal year. it will cost you to be in the house of the mouse. as we had to the opening bell, i want to get to scarlet. he went to disney world recently. >> that's right. fortunately got that in before prices went up. let us focus on crude oil which is trading below $50 a barrel this morning following his first weekly decline in a month. for most of february, it has been stuck between $40 and $54. most recently, but gold has been under pressure after citigroup came out with a $20 oil call. my next guest says people are ignoring the fact that the economy is improving. that should lead to higher oil prices overall. will talk with todd.
are you a little bit bewildered we are stuck in this range? >> good morning. as i look at oil, i thought the range is solid. 40 727 to 55. i am a buyer. i think we have a great chart setting up. i think the lows are in. i go back to the citigroup call. those are guys that are really looking to buy oil and not sell it. what we are really seeing is the market should be breaking a lot harder based on the overall dollar. the call by jp morgan -- why are we down to $35 a barrel right now. the truth is there is still a demand an oil is the over strength of the u.s. dollar .
they will start to adjust for this oversupply and oil. red cows will go down. they will not let these prices fall down further in my opinion. i was willing to buy a 50 nine getting a better price now -- by at 50 but i am getting a better price now. >> to what extent is oil a hostage of the bigger macro trends that investors are grappling with now? >> if you look we have certainly come way down. where were the big sellers? as we pull down, we made a nice bottom somewhere around 43 to 45. i think that a solid. the big advantage here is we are starting to build a base and moving our way higher. janet yellen speaking on tuesday
and wednesday with her testimony could create a little problem because the dollar has been exceptionally strong. the problem is the dollar. that is the real focus. the overall too much strength of the dollar. we can start to see oil pickup a little better. >> we want to get to our word of the week. we talked about oil. how does that factor into what we are seeing right now? what is this relationship to another word we often talk about? >> backwardation is what we are were at. if we go to next march's oil, it is trading at $63 a barrel. it is turning into a premium. that is called contango. it is a normal rotation. >> moving forward, we will see
how it plays out. thanks so much. we will continue to keep an i on oil prices trading below 50 at the moment. >> thank you so much scarlet fu. if you're are just joining us here's what you need to know. the government greece is now trying to satisfy voters and euro area finance ministers. they have until the end of the day to come up with new financial policies in a change for funding -- in exchange for funding. here is greg we are in the process of compiling a list and we will submit them in due time. we are pretty confident actually, very confident that the list will be in approved by the institutions and we are
embarking on a new phase. correct the group wants to raise expectations under the bailout. 150,000 cars recalled here in the u.s.. the problem? and problem that could cause an engine fire. coming back to work after a labor dispute. it may take a weeks to clear the backlog of ships waiting offshore. and you will be at his biggest investment for in europe -- ever in europe. they are building 200 data centers in ireland and denmark for some facilities will run itunes and act. -- and mac.
and victims of scam artists bernie madoff will get an additional 1.5 in dollars back. the money had been held up while long-term it off investors sought to get more money than short-term victims. an appeals court rejected that. so far, they have gotten back 17 billion of all that had been lost in that ponzi scheme. the winner of the daytona 500, 24 years old. and much more ahead, a different kind of race, more eyeballs are drawn to digital. will traditional media be able to keep up? we will be back. ♪
>> who gave this man a green card? bird man >> a little bit of it joke politically last night. we are joined now by two media heavyweights for big questions that are affecting hollywood. bob rice is the former chairman and ceo of universal, and now serves as cofounder. mike tomlin -- and mike dolan now at bacardi. and you get a chance to watch the oscars? and was there a big surprise for you?
>> the lowest box office movie of all time womn. >> [laughs] of all time. >> i don't know it was, but close. what i think it's very good for them, and a very good signal to hollywood that the overproduced over -- all of those things are just -- >> i was surprised that boyhood did not win. >> i can tell you that movie just for ever to make. and that is an independent film. i'm surprised that they didn't do much better. >> i was the gray -- i would say congratulations to patricia arquette for getting best supporting actor. will rupert murdoch make another go? if you done? -- is he done?
>> first of all, he's got two more weeks for making discoveries. are we going off the empire state building tomorrow? >> is thereshading his appetite? >> i would think so. i don't know about the third time around at time warner. >> that seems to be what is being speculated right now. what do you think at the >> i think the money is available. this is a good time to do it. we will never see these interest rates again. >> you mean these low-interest rates? >> yes. >> that's why i'm saying you have to jump on a bandwagon. it's a good time for acquisition. >> i heard he's interested in bloomberg. >> oh. no comment on that. his nbc going to pull out of its ratings?
-- is nbc going to pull out of its ratings? and now with brian williams being suspended for six months this hits close to home. what do you think about that? >> brian had almost 10 million viewers. when you think about that, if you go by 20 years, that's not so great. to have 10 million viewers today, that is four times what fox gets in the same time frames and so forth. that was a very big show. brand's personality was very big. that is why he appeared so many other places. on the other hand lester has only been there a few days and his numbers have held up pretty well. >> they have, surprisingly. >> he will have a ratings loss no question. >> will he come back? >> well, he can't. they made it so he cannot come back. six months is a long time. brian is a person that should get out there. i think he would like his chance to apologize and do some of
those things perhaps, like bill o'reilly did right off the bat. it will be a sad thing. he will be on the air, i predict on some channel with a buddy -- with somebody. >> on some show in some form or other. >> in six months. >> acting people forgive and forget over time if people handle it well -- >> i think people forgive and forget over time if people handle it well. as bob said, the direct about it and then move on with your life. >> what about the broader it to nbc? it has been hard hit. it has been in a slump. >> i think it all goes back to great content. you have as then flows -- ebbs and flows. all of the networks have lived through it.
the key is to sit through it. mtv is going to same thing, by the we -- by the way. -- and tv is going to do the same thing, by the way. >> tv has had content providers at battle with charlie ergen for a long time. where is charlie ergen, who is now taking over as ceo of dish -- why is he the most hated man in hollywood? this is a man who has been sued by all for broadcast networks. he drops the channel at the drop of a hat if he does my carriage fees. almost every one in the media auto hops. this guys making enemies left and right. why is he such a man?
-- why is he so much of a hated man? >> if you work for charlie, he's always the ceo, no matter what particular title holds at the time. he's got huge amounts of airspace in all kinds of different areas. what's right, airwaves. >> television, cable, cellular. he's got ends amounts of it. what do you admire in the? >> i admire his aggressive in this -- his aggressiveness, but he's very difficult to deal with. >> i thought he and his wife were both delightful. we took a hike in the width -- in the woods and he could not have been more pleasant.
>> mike, thank you so much. mike dolan, the former chairman and ceo of ing, and right now the ceo of bacardi. we've got less than an hour away to the start of trading. scarlet fu is taking a look at some of the early movies -- movers. >> that's right, i want to take a look at the influence of overseas movers. we will be taking a look at europe. the ftse touched a record high moving as much as 4/10 of 1%. it did give up its advanced after hsbc reported profits that missed analyst estimates. i also included the nikkei there because it made a fresh 15 year high in tokyo. we cannot get a close look at the bailout extension in greece because it closed today.
after surging more than 10% on friday down. volume was at three times the average of almost -- of the last three months. the wrubel also sliding, -- and the wrubel ruble -- and the ru ble also sliding. correct much more ahead. to vaccinate or not to vaccinate? 10 years of research on autism. and much more on that straight ahead. ♪
top stories the power. a major deadline today in greece. they have until the end of the day to outline reform plans for international creditors. the extension of the greece bailout plan is at the stage. and ukraine says it's starting to pull things and troops off the front lines. ukraine says rebel attacks have not stopped completely. president obama calling for major changes on wall street. the administration wants to reform the way brokers handle retirement funds. the white house says some brokers give money from small investors and give by and for financial advice. and the 69 people are dead after a ferry sank. the double boat was hit by a cargo ship. eight children among the victims. the dental could rise. seven months ago, about 100 people died when a ferry
capsized in the same river. investors pulled about $2.5 billion since october. the funds had ceased since last year. and hollywood's fascination with itself has been revealed once again. bird man was named best actor and captured three other major oscars including best rector. it's the story of a washed up actor's come back. it's the first time -- third time in about four years that the film about hollywood to the biggest prize. and in health care, the country is still in the midst of a debate whether to vaccinate your children against disease. the debate was ignited after an outbreak of measles at a disney theme park a few months ago.
now there was a call for all kids to be vaccinated, not just against results. there are concerns that it can cause other conditions, such as autism. the story is close to home to bob wright, who is marking 10 years of progress at autism speaks. it's the largest organization benefiting autism research. bob and suzanne, thank you so much. great to see both of you here. this is a timely topic to have you on discussing autism. for a long time, even me as a parent, you hear about fears of vaccines causing conditions like autism, even though there is no science kind that yet, right tackle >> back -- right? grexit vaccines are very important. there is no question about that.
in the case of autism, we have done research of our own and a lot of the research that has been done has not been able to determine any direct link between vaccines and autism. nevertheless, you have to remember that parents are the ultimate decision-makers with the vaccinations of their children. and there are cases of situations where parents have a particular situation was an infant or child or reaction to some other situation and they have to make those decisions. if they choose not to vaccinate, there are consequences from that. and local medicine valleys -- local municipalities this is all local and state law. you will be impacted in terms of schooling or education or maybe joining other activities. parents have to know that. >> how do you feel about it, bob and suzanne? >> i don't think you should ever be mandating vaccines. that has a very nasty theory to it, especially when there are 30 of them will stop -- when there
are 30 of them. i don't believe in mandates, but i believe giving parents education and letting them make the decision. >> tell me about the 10 year -- marking 10 years in autism speaks. >> is pretty remarkable. >> it is remarkable and we are much more aware of autism now. what about the next 10 years of how we treat and possibly -- is there a cure here? >> we are hoping. with the awareness that we have given not only around the country, but around the globe there is 50% more awareness for parents with children with autism. that is because the ad council has taken on one of the most successful campaigns they've ever had, led by linda robinson, who is the ceo and on our board. this has changed the lives of so many people with children with autism. we had no idea that it was one
in 166 at the time and we had no idea what they were talking about. and we have changed it. >> now that people are more aware, have we swung in the other direction? where people feel like they're over diagnosing kid these days? >> i don't know that overdiagnosis is such a problem. >> if you have it, you have it. if you don't, you don't. correct it very difficult to diagnose post-up what we've gotten better at diagnosing. >> -- >> it is very difficult to diagnose. >> we've gotten better at diagnosing. >> suzanne, thank you so much. and bob, thank you as well. we will be back two minutes. ♪
>> welcome back. we are 30 minutes away from the opening bell. in the u.s., little change in stocks at the open. and the clock is ticking for greece. the government has until the end of the day to come up with new financial policies in exchange for funding. the agreement extends bailout funds for four months. reese's primary -- greece has finance minister spoke in athens. >> it will be submitted in good time. we are very confident that the
list will be approved by the institutions and therefore we are embarking on a new phase of growth. >> they must show they will be able to raise expectations of the current agreement. an agreement to buy phthalic the maker of gastrointestinal drugs. the obama administration going after wall street again. this time it has to do with retirement facing. a new labor department proposal will make it harder for brokers to push mutual funds on those saving for retirement. apple making an investment in europe, almost $2 billion building data centers in ireland and denmark. the facilities will run services, such as itunes and
mac. and tighter security at the largest mall in the u.s. after a terrorist threat in a video. the terror group culture bob called for attacks in the u.s. canada, -- the terror group al-shabaab called for attacks in the u.s. canada, and u.s. secretary jeh johnson is urging caution. >> if anyone is planning on going to the mall of america today, they have to be really careful. there will be enhanced security there that will be apparent. >> federal security as well? >> there will be enhanced security there. >> the terror group, a year and half ago, it attacked a shopping mall in kenya. and bird man was flying high last night at the academy awards. it's the story of a washed up actor trying to stage a comeback. it got four oscars, including
best picture and best director. and best actor went to the actor portraying stephen hawking in "the theory of everything." >> thank you. i don't think i'm capable of articulating everything up feeling. i am fully aware that i am a lucky, lucky man. >> you love me, you really love me. meanwhile, julianne moore one for her -- won for her role in "still alice." cleft he is no love here than i am. i am luckier than he is. -- >> he is no luckier than i am. i am luckier than he is. >> some investors are losing
patience and dreamworks. apparently, katzenberg spent $1 million on a campaign to win the oscar and has come home empty-handed. collect and million dollars might sound like a lot of money to us. -- >> $1 million might sound like a lot of money to us. i think the main number there is "two," in that it is "how to train your dragon2 2." don't make sequels. >> i agree, $1 million to dreamworks and katzenberg is not a lot of money, but $1 million is a lot of money for investors who are sick and tired of seeing this. they want katzenberg to do more with it. >> awesomeness tv.
>> awesomeness tv, for sure. but somebody has probably work out how much oscar is worked -- is worth. $1 million is not that big. >> a trip to disney's magic kingdom will cost you extra. they just hike ticket prices to $105 for single admission. it's the three digit barrier for the first time ever. it will not keep the crowds away for -- the crowds away, right? >> a 3% increase, no, it's not going to stop anyone from going. i hate to play the old man. back in my day, we used to sneak into disneyland. don't pay attention to that. the first time i went was in 1975 and it cost seven dollars per ticket. i went to kick my dollar -- my daughter to a concert there and
it was $50 per ticket. >> people are paying up for experiences, but inflation at disney world is still staggering. the cost at the magic he knew doubled since 2003. -- at the magic kingdom has doubled since 2003. >> but they are doing well. >> it is about one third of their bottom line. >> they should have scholarships to send kids. >> a coca-cola and disney world is going to cost half of that $105. changes at the networks. the ceo is stepping down and charlie ergen is taking his place at dish network. let's be real here.
>> why do people say he is the most hated man in his media -- man in media? >> shall i go down the laundry list? he has been sued by content providers, by all four networks. he drops channels of the doesn't like their carriage fees. he sided with dario --aereo against the networks. he's hated by the advertising world. it -- the list goes on and on. >> and alex sherman, who covers media for us, he likes to say he's the cheapest man in media. >> if you are going to watch tv on this baby come and only on this baby -- >> that is my iphone. >> it was sitting right here. if the prop. -- it's a crop. a -- prop.
>> he has spent $50 billion on buying airwave spectrum. union workers rejected the seventh contract offer from show last week. workers have been on strike for three weeks. it's the longest u.s. refinery strikes in 1980. -- since 1980. >> almost 20% of u.s. refining capacity now faces a shutdown. shell is doing the negotiating on behalf of all of these oil majors. the union has rejected their offer seven times. the last time in 1980, the strike lasted three months. hopefully, it doesn't go that far. this time, the issue is because of oil prices. the refiners have less -- it's bad timing for the workers to be trying to get more from refiners. >> still, with the still
workers, they represent about six percent of the capacity in the u.s. refineries. -- 60 percent of the capacity in u.s. refineries. how will this affect the price of gasoline at the pump? we don't really know, but it probably will at some point. >> and that is why we are watching it so. something else we are watching closely, number six according to the "wall street journal," investors have told about half $1 billion from a hedge fund owned by carlyle. this after fannie mae and freddie mac did not pan out. it is yet another sign that as private equity firms are trying to diversify like everybody else, they want to -- they have
problems with setting up these hedge funds. >> the story of 2014 was that overwhelmingly, manage money and hedge funds underperformed the benchmark stock >> oil had a lot to do with that, i'm sure. a lot of the private equity firms did pump a lot of money into -- that is kind of a pun isn't it? they pumped a lot of money into oil, and they didn't pump a lot of dollars back out. again it remains to be seen what will be winning this year. >> coming up, the container store is speaking out of the box -- seeking outside of the box but investors want to put a lid on it. say "in the loop." -- stay "in the loop." ♪
into number five which is the wage debate. just leslie, walmart announced it would raise its wage to nine dollars per hour beginning in april for some of their employees. amidst all of this, the container store and ceo have been working hard to sell paying front line workers is good for business. the average receives a salary of $48,000, nearly double the typical retail salary. but investors only seem to be focused on a massive slowdown of sales and plunging stock prices. one of my favorite stores, by the way, the container store. we sat down with the ceo for this latest article. will investors put the lid on the container store generous wages? >> since the company went public, sales have definitely
slowed. but chip kimball says the wages are part of the whole business model that he had, which is that he hires very educated people and gives them a lot of training and pays them while. and ultimately, he expects them to be more productive than the lower paid worker will be. what investors are asking is, but we haven't seen that. what has been happening? what he says is that his business -- and he's been running the container store for more than three decades. it's only been public for a here and a couple months. he says our business doesn't go like this, but like this. and he says there are down cycles. unfortunate for him that he went public just as a down cycle started. >> right, so investors are frustrated. and they are trying to focus on any issue that they think help the bottom line. would it help the bottom line i
guess, directly in people back on this wages? >> the argument is possibly in the short-term, but not the long-term. a lot of these companies that pay well, suggest costco -- you can make it argument about a lot of different companies -- but they all say you need to look in the long-term. we will have bad quarters like every company. but we don't want to make decisions based on those bad quarters. we want to keep our ion what we think is still most important. we want in -- we want to keep our eye on what we think is still most important. we want investors that think the way we do. >> what is he doing to get the company back on track after >> -- back on track? >> they have a couple of initiatives underway now and they should be going soon. the first is where they send an organizer into your home and organize everything for you. and the bigger initiative is the premium closets called tcf
closets. it's kind of a walk-in closet would -- wood, and it could sell for several thousand dollars. he's hoping that will boost sales for, let's say, the next three years. >> does he regret taking the public -- the company public at all? >> anil think he likes the scrutiny but i think he thinks it was the right choice for the company. >> you will get a lot of heat for that as ceo. thank you for this week's article on the container store. coming up, apple spent $2 billion for data centers in europe. and big pharma just gets bigger. more on that next. ♪
>> let's get back to bring you the most important stories ahead of the opening bell. olivia sterns is joining me. number four, apple is making the biggest in vestment in europe ever. the iphone maker will spend almost $2 billion building data centers in ireland and denmark which they plan to open by 2017. >> they only have $168 billion. >> they could make 80 more of these. >> regulators in europe are pushing to have data centers located closer to home. that is one of the reasons facebook google, and now apple are now trying to move servers closer to europe. another reason is quite possibly the weather. they are installing them in
colder climates because it cheaper. >> li na what i like about this -- do you know what i like about this? the renewable energy part of this. these will have huge solar panels for renewable energy. it's about time that big companies did this sort of thing. >> does that get into your -- >> that's my thing. i keep hitting my microphone. i'm an amateur. let's move the direction of not fossil fuels. >> harbor neutral there. good on apple. judging by the barometer of hedge fund interest, there is less excited -- less to be excited about in gold these days. with a strengthening dollar and growing equities diminishing the bull jan store as well -- the bullion store as well.
you have to be kind of paranoid to believe -- correct these are analytical, very rational people. >> are you a gold but? -- biff? -- are you a gold buff? >> no, i don't think i own any. i will have to check my basement will stop >> with everything going on, ukraine, middle east why don't you want to invest in gold? >> the fact is, the dollar is doing so well. and janet yellen in the basement of the federal reserve is just printing this tough. >> it is merger monday. speaking of the dollar, maybe that is helping some.
valiant agreed to buy salix for about $10 billion. we have been talking about how the big pharma deals are likely to continue to happen. valeant said that they are apparently not done. >> and salix had exposure to one drug, the drug that treats ibs. >> what does ibs stand for? >> irritable bowel syndrome. isn't that a nice thing to think about as you are eating breakfast? >> it's better than botox or botulism. there, i said it. >> the stronger dollar is helping these companies. >> the criticism of valeant is
>> welcome back. let's get back to the most important stories before the bell. number one, once again, the clock is ticking on greece. the government has until the end of the day to come up with a list of new financial policies in exchange for funding. that is part of the extension of the bailout for four months. the world hangs in the balance on what they've proposed. >> there have been so many one minute to midnight moments for grief. whatever happens, it looks like it will be politically bruising for alexis tsipras.
he has drawn so many lines in the sand. he's going to have to backpedal on some of those. >> is gemini a greek god? doesn't have to head? -- doesn't it have two heads? he saying one thing to the populace and the other to the negotiators in europe. how does he reconcile lease two things? -- these two things? >> because he's in politics and he's going to act like a regular politician stop -- regular politician. >> and maybe play a little good cop/bad cop with firefox -- verify varoufakis. >> gina what do you make of this? >> until something happens, it's
just a lot of noise. and there's not a lot of recent position for a greek to sell. there's not a lot of reason to focus on it until something truly does happen. >> are you selling your precooling? >> -- selling your greek holding? >> i don't have any. i have a u.s. equity market strategy. cracked for a while now, what happens to greece doesn't really affect the u.s. consumer. -- >> for a while now, what happens to greece doesn't really affect the u.s. consumer. >> they could make some pretty significant financial impact if they exit the euro. you will have a financial market fallout from serious currency disruptions in that event. anil think there's any reason to position for that. and there's very little real economic impact that we are expecting from anything
happening in greece. i think the more important news will be yellen's testimony before congress. if she starts to guide a little more harshly the, the market will not be happy -- more hawkishly the market will not be happy. >> you are at 2.22 by the end of the year for the s&p. >> yes, 20 to 22. -- 2222. we have an adjusted for oil prices. keep that in mind. we have to adjust for lower oil prices. we only do that after our earnings. it should come down a little bit, given the direction of oil prices. and actually put these estimates together in late november, we were looking at an average program price in the 70's this year. it looks more likely we will see
some 60 as the average per barrel price. that will take our energy estimates lower. i don't expect to see any changes in the earnings estimates for the rest. it is really what is happening in the energy complex. in my mind, energy stocks are still very volatile. the earning streams are still pretty dicey. i think the vast majority of the pain in the energy sector has largely subsided stop >> -- subsided. >> how do you change -- trade in your energy portfolio? >> i think we go overweight in the industrial in -- the investment in materials. >> aren't they cutting back capex? >> they are but the consumer gets this windfall as a result of oil prices.
everyone is focused on the capex reduction. the reality is, there are lower oil prices that are we are largely ignoring. there is a segment that is pointing us to industrials and materials. a lot of that has been priced in as earning estimates have come lower. we think there is a significant chance that these groups could beat expectations as the year progresses. and relative to how the market has shifted in last three-month, i think within the consumer space, you want to target some opportunities in the lower and middle income consumer. but i don't think oil prices will result in a massive consumer spending boom that truly benefits retailers that much. >> getting back to yellen, you mention her and her testimony this week. are there specific words that you are looking for that you will sell or buy? >> the key investment word right now is patience.
if they drop that word, we will probably have a little bit of panic mode. i don't think yellen will do that in her testimony. i think she will say something like remaining patients data dependent. focus on employment conditions. i don't think yellen will surprise us by suggesting something is more hawkish. but any indication that they may remove that word patience from future statements -- >> all of your colleagues will go toward the seller by but in the minute she twitches her eyelid. what do you think she has of the store is out -- >> do you think she has a thesaurus out? >> what is interesting is this is the exact repeat of the sequence of events that occurred
in 2004. remember, six months ago we were all focused on considerable time to patience. it's not actually a easy in today's world to focus on patience. it's a repeat of 11 years ago. you could argue that for 30 years, the fed has been airing on the side of extreme that wishes. -- erring on the side of extrinsic dovishnes. >> have you pushed back your timeframe on raising interest rates for the fed? >> no, we haven't. our economist still think they start in june and go very slowly through the end of the year. and including a decline in
energy costs, they probably start to raise rates in june. some of the measures this year will probably be very token like, going from 2.25% to 2.5% is not a huge change. >> june is now four months away. it was easier to say that six months ago. then you get to three months also as nicolas "her to june, i think it will be -- as we get closer to june, i think it will be a lot harder for the fed to raise rates. >> i would agree. they would have to remove the patience word. march will be hugely important providing yellen does today but we expect her to do. >> and so glad you have the decoder ring. >> is all guesswork at this point as to what the fed is
>> writing just underway here. we are little in the red -- trading just underway here. we are little in the red. >> tesla is extending its gains to a six straight day but one analyst says the company's strategy on issuing lofty long-term target is difficult and will lose its luster. he sees a long and challenging
road ahead. tesla is down 2% so far this year. another bearish analyst call here from goldman sachs ongoing. -- on theboeing. boeing is declining for the first time in seven days and backing off of record highs. it has seen its worst drop in a month the cousin had rallied to as much as 158.75 last week in anticipation of a deal at salix. ritual pharmaceuticals is up as well as celldex therapeutics.
>> huge run-up in some of those pharma stocks that you showed. now in washington, the white house picking a big fight with wall street over the handling of americans $11 trillion of retirement savings. the obama administration accusing brokers of skimming significant sums annually and is calling for new protections against biased financial advice. in an internal memo last, the chairman of the white house council of economic advisers said in a statement that incentives costs savers billions of dollars a year. we want to bring in our guest from washington. ken, what you make of comments like that that brokers have
skimmed off billions of dollars and it's about time they paid back? >> it is unfortunate that the white house would engage in this kind of political discussion when in fact, they are picking a fight with the 58 million households that deal with the representatives across united states to get the education they need to save for retirement. statistics are quite clear that the vast majority of american investors, retail investors, choose commission based accounts because they tend to be buy and hold accounts and are much more cost efficient. the department of labor's proposal has always been in their previous proposal that they would cut off access to education for investors. and force them into higher costs advisory accounts, which many have said our services they don't want to buy. and on the lower end of the scale, it would cut them off
completely from any education. >> help me make sense of that. why would that do that, though? >> it would do it because of the way the department of labor structure their original proposal, which would ban all sorts of communication between a financial advisor and a client. in order to avoid that dan, you would have to put them in to what is known as -- in order to avoid that ban, you have to put them into what is known as an advisory account. the majority of investors tend to buy and hold. this is highly regulated by the fcc, by thin rug, by state regulators in some cases. what the department of labor has done is to ignore the existing regulatory architecture in place that protects investors and provides them with redress, but also allows them the choice of
how they want to buy and pay for the services they want to buy. >> why is this such a bad thing for the white house to say that these brokerage firms and these brokers have to put clients first? i mean, that's the way wall street and business operates. you put your clients first. why is that such a bad thing? >> as a matter of principle, i think firms try to do that. but the bottom line is what you the tory structure do you operate? if you are acting as a principal as many brokerage firms across the u.s. are, when you are making -- underwriting transactions and acting as a principal, firms all across united states do this for the benefit of their investors, and then you operate under a different regulatory regime highly regulated by the fcc and by sandra --finra.
on the other hand, if you are taking a client's money in and giving them full discretion to charge on your behalf there are different approaches that investors take napa a different fee structure -- and they pay a different fee structure based on what they want. that is where the fcc is trying to -- the sec is trying to regulate. >> we've got to leave it here. thank you so much, ken benson. still ahead, the eurozone in -- agreed to extend the greek bailout another four months as long as they propose new financial measures. erik schatzker is on the ground in athens. stay in the loop. ♪
continues. they scramble to come up with new financial measures by tonight. if they do not come up with new fiscal policies that into the day, they can forget about four months of bailout funding. erik schatzker is on the ground in athens right now. tell me first what you are seeing there in athens. >> well, what i've seen so far is anticipation anticipation for what is going to be in this proposal that is coming from y anis varoufakis, the finance minister. that could be 7:00 or it could be midnight. you could turn this moment -- term this moment right now i've the call before the storm and after the storm. greeks are very eager to see what is in this proposal.
remember, the party in government pledged to the greek people that it would roll back austerity. the likelihood of that is almost zero. and we have heard from the government today assuring greeks that they will not experience more austerity, but the devil is in the details. they need to know what is happening in the way of taxes, revenue collection, all the things that the government will need to put in this proposal to meet the deficit target set out by the eurogroup stub >> is anyone talking about the possibility that the eurozone creditors could reject the proposals from greece? and then what happens there in athens and beyond? >> yes, of course they are talking about that, but you have to hope the likelihood is all, because the alternative to success is serious failure. we are talking about a banking crisis, a sovereign default. yanis varoufakis is certain of
what he's going to put on the table because the alternative is certain. grexit it looks like we've lost the signal there. he is entering his program live -- >> it looks like we've lost the signal there. he is anchoring his program live from athens. do we have him back? >> i'm here. >> we only have a little bit of time left. tell us what is coming up on your program. >> we have a shipping tycoon. greece has a few shipping tycoon. i was able to find one. you will hear from him how he feels about the prospect of the deals coming from the eurozone and whether greece will make it through this crisis moment. ask thank you so much -- >> thank you so much. much more ahead. why is tim cook traveling the world so much these days? more on that next. ♪
considered no amateur. he is one of the top two stars on the major league eating tour. cory johnson, our bloomberg west editor at large. before we get to tim cook and why he is traveling so much, are you a bacon lover? >> i was until a 20 seconds ago. how could you take the fun out of bacon? that is a record. crack i know, by eating 86 pounds of it. that is how you take the fun out of it. >> i believe every meal should have a sacrificed pig involved but that ain't right. >> there are real efforts to sell the apple watch all over the world. this comes as apple ceo tim cook is said to meet in brussels today.
why is he traveling the world so much? >> is a different -- it's different for apple, and not just because they are cash forward. the release of the apple watch was said not to go beyond the united states, but we are getting that suspicion. we know some of the globetrotting happen in mexico. some of the issues were does -- that were discussed were revealed, because the government is required to do so in those private meetings. and they said they would meet with health care officials about the role of development in the role of health care. similar meetings took place in the u.s., but also in brussels and also on the agenda in israel. when issues of privacy have been raised, not just by apple in the breach of the celebrity accounts at the oscars the regulars want
to know what they will do in terms of privacy and what this medical device will do and whether it should be regulated in the country's it is sold. >> and the overall international market is hugely important to tim cook. >> and the cash that apple has -- is increasingly overseas. -- that apple had stashed is increasingly overseas. this issue of privacy is something that apple is ending a drum on. they have a different take on privacy than competitors like facebook and google. they gather a lot of data on their users as they use their services, and in a mind that data save that data, and a search that data, and they sell things to their users as a result. apple takes the and that we don't make money that way. they don't make money -- we make money by selling devices. we don't want your data.
as they are building a business around the world, this starts to differentiate them and they want to make it clear to regulators as regulars look at this issue of privacy that is coming a bigger and bigger deal. >> cory johnson, thank you. that does it for "in the loop" today. my guest host tomorrow weighs in on all of politics playing out in his hometown of chicago. and they run up to tomorrow's vote, that is coming up. ♪
>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. stephanie: greece is playing in the clock. the government has to come up with a list of new economic reforms by the end of the day. we will take you straight to athens with our own erik schatzker. >> dish network chairman charlie ergen takes the reins of the company he founded. stephanie: and drink up. america cannot get enough bourbon. welcome to "market makers." i am stephanie ruhle.