tv Bloomberg Markets Bloomberg May 15, 2015 12:00pm-1:01pm EDT
the challenges of operating in a new frontier. winner istucky derby the favorite to win the preakness. we will get his odds of becoming the first triple crown winner since 1978. ♪ pimm: good afternoon i am pimm fox here with betty liu. let's take a look at the markets at this moment. 18, down by six
points. following after a rise this week, kreuz do -- crude down. those disappointing numbers, consumer sentiment that was also some reasons you saw the yields come down. you could see that they are in coming off ofnow some of the highs we saw for the greenback. the euro is stronger here against the dollar, and that overall weakness based on some of those economic numbers. pimm: a big rally in the
euro-dollar. get a look at some of the stories. it is official, russia's economy has had its first decline in almost six years. they shrank 1.9% in the first quarter, better than all of the survey. in a bloomberg the forecast that the economy will slump for three quarters, growth stalled last year after the united faith and western european nations imposed sanctions because of fighting in ukraine. plus, oil prices collapsed and the ruble currency plunged. a judge may end up deciding how much money victims get from tuesday's results amtrak were derailments. cap total damages at $200 million. eight people died and more than 200 were injured. investigators say they may get the trainrs about why
was beating in the next few days. >> i'm very pleased to report that we have contacted the engineer, and he has agreed then to be interviewed by the ntsb. we look forward to that opportunity. we will be meeting with him in the next few days. pimm: the lawyer for the engineer at the throttle says his client suffered a concussion in the crash and recalls little, but he says the engineer was not under the influence of drugs or off a whole was not using his cell phone. in nepal, the u.s. marines are confirming that the wreckage of a u.s. helicopter has been found. helicopter disappeared earlier this week while on earthquake relief missions. marines anding six two nepalese soldiers break they found three bodies near the crash. they say this unlikely anyone survive. earlier this week, video showed marines delivered food supplies to earthquake victims. ofty: the prime minister india is calling on china to reevaluate a disagreement
between the two asian giants. concern specifically about a long-running border dispute. they had a major standoff last september. ranging from trade, to railways. investor carl icahn is raising the stakes in the car booking lyft, hetween uber and of put the largest amount financing in this latest round of lyft. consumer confidence has fallen this month by the most in more than two years. the university of michigan index was lower than the lowest estimate of economists surveyed by bloomberg. news that the u.s. economy stalled in the first quarter shook many americans outlook. gas prices in march also hurt. people are more concerned about losing their job in 2009 --
since 2009. unchanged in was april, and for the fifth straight month total production decline. manufacturers have been hurt by the stronger dollar. your top stories at noon. much more in the next hour. as the -- has the bond selloff run its course? u.s., advance for the second day. pimm: we will look at the challenges of operating a business in myanmar. betty: and this weekend, the kentucky derby winner is a preakness. win the can he goes all the way and when the -- when the trouble crowd? crown?the triple
is there and the economic andngth to most stocks high keep interest rates low? betty: we want to bring in mr. goldilocks pimm:. he is sitting right next to us. let's answeroff, the question. did we see a temper tantrum in the bond market? >> i do not think this temperature interval looks like last year's because it is increasingly clear that the fed once, after almost seven years of zero, once to start normalizing rates. maybe not bring them up 4% or 5%, but they are telegraphing us that one or 2% is not going to damage the economy. what was the most recent daddy?
tudy? betty: the number of people who thought it was marginal in january. that has grown to almost everybody thinks in september they are going to raise rates. >> sometimes the ecb chief or chief wants to draw down markets when they are too frothy. here they have been very successful in bringing the fixed income market. this temporary condition, and i think most of us think temporary was a year or two, it is six years, it is time. the economy is getting better, but it is a post credit crisis recovery. it is soft, weak, that is what history has done. pimm: i want to go to julie hyman in the newsroom, she has news. dan loeb exiting his
stake in alibaba. the deadline is the end of the day, and these are all sorted based shot in time as of the end of the first quarter. we've been hearing from a lot of different managers. the billion dollar and does not seem to be having a lot of effect on stock which is a big company. it seems like the bigger the company, the less of an effect this has. report contrast, a third , the stock has been spiking in clayton williams if you take a look on my screen. also he is tracking a stock and brands. in yum! there are analysts saying it is more of a probability that a
would spin that they off their china business. those shares have been up throughout the session, and now they are about their highs. we're going to continue to monitor. pimm: thank you. holde here with very roots ritholtz.rus are they motivated by the same thing as the stock market? >> yes and no. the classic allegation folio was 5040. 60/40. that is one of the things that have been keeping a bid on bonds even as the market rallies. if we were to drive ends diagram, there would be an overlap. investors,ed income
who are therefore safety and yield an income, not that there is a lot there these days, that tends to be a different audience than equities because there is tremendous overlap over the two. you actually highlighted theychart recently, where looked at the spread between the 10 year u.s. treasury, and the 10 year german bonds. essentially, since the crisis, look at how close and correlated the spread was the first three years when we started to recover. look at how the spreads have why idened.wh what does that tell you? fore can talk about this hours. when you have japan at deer zero ive,switzerland negattiv
and the u.s. over 2% over there is only one of a couple of things that will happen. either the u.s. will follow to everyone else, or we are corrected everyone else will start to meet us. we are one of the biggest. betty: what do you think will happen? >> i could not even guess. it is dependent on 70 variables we have no idea about. if u.s. going to continue shrinking its annual deficit? one normally used to happen, we would have a surge of spending, and that would gradually reduced. we really did not see that as much this time as. s, soss financial crisi the fed was the only game in town. , and japan exiting
endorsed that wholeheartedly so they are number two behind us. europe is now following japan. the baton has been passed. to guess, i would tell you since the u.s. this done with few weeks ending for you to rates in europe and japan is your church is ahead of them in that process. bureau follow each other but on a bit of a line. that is just a because there are so many variables. we could talk all day about it. thank you. >> my pleasure. pimm: still ahead, president obama's trade agenda is on track to move the democrats are not giving up the fight. ♪
pimm: welcome back to the bloomberg marketing. betty: let's get straight to a check of the markets. thee just talked about download filing. but what about food that gets -- boone pickens? julie: one of the stocks he is buying is a contract ruler of america.uth that is one of the ones he is picking up. not seeming to have that much on the phone -- the stock.
remember, this claim are we always offer is a snapshot of guysay in time, but these are buying and hold investors. these are snapshots as a the end of the first quarter. one of the other stocks that he is lower last quarter but not traded. pimm: thank you. the trade bill may be advancing the senate, but many democrats are not giving up the fight. they are throwing a procedural roadblocks. betty: it would give president obama be the issue restaurant --
to fast-track trade agreements. they are in a civil war over trade. >> and all my years of covering capitol hill, i cannot remember an issue that divides democrats like this. it has been interesting to see democrats taking shots on each other. and the fact that hillary clinton has not weighed in, this is how sensitive it is right now . biggest one for the press to see if we can hope that it when allies whoclose disagree on a policy issue.
they are still some of michael szymanczyk supporters who disagree with me on this. i understand. >> we spoke with the other bloomberg reporters. one of barack obama's earliest supporter, when he was a state senate candidate was she cannot understand where the president is on this issue. she is opposing him on this and promising to fight him. betty: thank you. ahead, myanmar is open for business. so erik schatzker sought for himself. flood of theide first companies to set up shop. we will hear from one of the top executives. ♪
pimm: myanmar is open for business after a decade of economic isolation. betty: worldwide is the first up. hotels aren giant to set shop. erik schatzker went there to see the potential and challenges of operating in this new frontier market. erik: for almost 50 years this country was closed to the west. imagine the billions of
dollars to get infrastructure. that by default is a tremendous opportunity. it has been only three years since the u.s. lifted sanctions. helton moved fast. already there is a 200 room hilton and the new capital city. a beach resort on the bay of bengal, and plans for three more hilton. >> there was a great interest from a business perspective to come to the country, and also from a leisure perspective. erik: for decades, this is what the world's irma. knew of burma. now tourism is taking off. growing by more than 400% in 10 years. the rest of the world is starting to discover the
breathtaking beauty and rich history and food. size of that, the color, they do not smell. they are very sweet in flavor. erik: what is missing our first world standards. after so many years of isolation, they can barely meet the basic needs of western companies. blake shelton. trying to make five star from scratch is quite a challenge. getting supplies to the hotel, a lot of logistic challenges. erik: they want to more than double tourism in the next five years. the government has enlisted it runs a business to help -- it's friends in business to help. tell me about your strategic partner?
>> we have great respect for each other, a lot of digital goods is done before we select business partners. so far so good. byk: their gdp may triple 2030. can see the new ambition in the capital. forest in of farms of just a decade. judging by the barely used international airport, and the deserted 20 lane highways, helton may have to wait for years to get a return on its investment. betty: these are all these frontier markets that are just right for investment. myanmar is one, cuba is another. vietnam, we were just
rattling off the list of other countries. about realing frontier market and countries smelling the opportunity now. pimm: i thought it was very illustrious that eric was standing in front of a 20 lane super highway, but there were no automobiles. so the idea of spending all of on things that would benefit the government, but not the people, i wonder , ifher the farm business that will make up for the lack of government support. betty: in the meantime we would be remiss to not mention the political problems going on right now. pimm: the refugee crisis coming can see that on a regular basis. their neighbors not wanting these refugees.
they are escaping political persecution. pimm: this is a continuation of the persecution of muslims as well as the ongoing fighting. betty: that is a risk for business. i'm going to leave in a very capable hands. what is coming up? coming up, netflix taking a step closer to the chinese market. predictingts are shocking subscriber growth. how about netflix as a $100 billion company? ♪
russia's economy has had its first decline in almost 6 years. growth stalled last year after the u.s. and western europe impose sanctions over the fighting in ukraine. oil prices collapsed and the ruble plunged. a judge may end up deciding how much money victims get for al amtrak tot relevant. if people died, and more than 200 were injured. meanwhile, investigators say they will get some answers about why the train speeding in the next few days. >> i'm very pleased to report that we have contacted the he has agreed to be interviewed by the ntsb, and we look forward to that opportunity. we will be meeting with him in the next two days. betty: the lawyer for the engineer at the throttle said that his client suffered a
concussion in the crash and are members are a little. he was not under the influence of drugs or alcohol, and was not using his cell phone. carl icahn has put $100 million into lyft, the biggest chunk of the latest round of funding. one of the managing directors will now join the board of lift. the art world has never seen anything like this. this painting went for $50 million last night at christie's. wasn't auction record for a modernist painting and it sold at the end of a record two-week frenzy. art haslion worth of more than the, previous record set last november. but with a look at the top stories at this hour. much more in the next half hour.
netflix now looking to enter china. we will have the latest on the the world's most populous nation. and we will get a preview of tomorrow's preakness stakes in baltimore. american pharaoh is the favorite. china's sixyeing billionllar bit -- 6 dollar video market. they are looking to jack ma to help them navigate the licensing rules. this is according to people familiar with the matter. they also came up with a report predicting netflix will be the company --illion
$100 billion company. thank you for joining me. let me start with you. this prediction of $100 billion, is this far-flung? a i do not think it is far-flung idea. -- ave a $900 million price that would value the net $60 billion. growth, because people love it in the u.s. and internationally. verycan entertainment is exportable, and they are right at the nexus of that. say a not only do they $100 billion company, they also will be a $2000 stock.
martin was just talking about the international potential. you have this news today that they are in talks with chinese partners. to ignore theord chinese market for netflix. they are the largest global market. they have 190 million broadband households. it is impossible for netflix to ignore, and they have realized they have to do it with all of the regulation and all the strict and trolls of the chinese market. the best way to do it is to go to a local partner. just to navigate that strict regulatory environment. we know that no major internet company has a presence in china, not google, not facebook and
this might be the strategy for them. betty: their head of content and china is too big to have terisk next to them. they have to be an important part of the strategy. how much will this impact earnings? china is a market where there's about 200 billion broadband homes. that is twice as many subscribers than that the u.s.. there about 600 million broadband drivers outside of the united states. that is a huge opportunity. for every one million netflix's, that each one dollar leverage on pricing, where china is a less envelope opportunity the other markets, that will add to the bottom line.
once you are at scale, and at the bottom line, there is a ton you can add. betty: they want to could ruble the number of markets by next year. they said they will complete their expansion by 2016 so that takes them from 50 to 300 markets. say this as someone who is now on a television network, netflix single-handedly wants to put in your television out of point linear television out of business? >> i think you're talking about
a change in television. what netflix sees ending is the idea of linear television. television will follow that change would bloomberg will be on demand, cnbc will be on demand, all of this stuff will be on demand, and they want to be at the lead of that. also in asee this week where verizon has bought aol. how much of that is the netflix effect? >> the discussion is really pivoted in the past year because the consumer is loving on-demand video. people are spending two hours a day watching netflix. the time spent with netflix was up 25% year-over-year. grownbscriber growth has vertical. regular television is declining. if you as a subscriber if they would rather have netflix or
pay-tv, it would be netflix. what about the price point? came in with $14.99. >> the grandfather done in for two years. we are not we to see the entire effect of the price hike take effect until 2016. they definitely have some potential to raise prices, but nine dollars and nine cents has been working great for them. betty: thank you. ahead on bloomberg market day. stocks turning negative.
betty: welcome back to the bloomberg market day. let's take a look at the markets at this moment. equities have been fluctuating near the record. slightly down right now. the dow off 15 points. ,he nasdaq down by 2/10 of 1% given the disturbingly low consumer sentiment numbers because this morning. let's take a look at your reaction to that number. let's wrap up the trading
day in london. i'm looking at 5100 that is right. the whole map in europe this dark color red. the 5100 off a 10th of 1%. benchmarks the stock 600, a week of losses delivered by equities this week. rolling over, accelerating into the close. exasperated by that consumer confidence number. the dollar drops, the euro pops, there is the move, the complete u-turn in the euro. story in play.o a relationship that was not in play today. stocks dropped, bonds did not. a rally in european fixed income throughout much of the day in the periphery and in the core. likewise in france, french bond
yields down by five basis points, 0.93%. that bond from them in the big callsd market, no about that recently. here is a big call for you, we could be close to the end of that bond route right here in europe. that is a big call. betty: as we have been reporting, shares of neck looks -- netflix higher today. we have much more from hong kong. netflix is talking with possible partners of china as a looks for ways into the countries 5.9 billion dollar online video market. according to bloomberg sources, among those netflix have been speaking with, a company owned by jack ma. they are expected to triple the $14.5 billion 2018, but to take
advantage of that growth, it is essential to have a local partnership to teach them strict controls over licensing and content. betty: netflix is of a record high now. the united states, julie hyman has a big story of the day. after ups is on the rise an analyst upgrade. saying that that reflects at least what goldman analysts expected, better pricing power on the part of ups. we are seeing those shares higher today. yesterday tumbled after it came out with earnings and is rebounding today. upgraded to market perform from underperform. analysts increasing confidence that it can meet its 2017 target of reaching $1.2 billion in even. -- ebita.
according to people familiar with the situation, anadarko petroleum is ready to choose cvi as the main contractor for a mozambique project that would be big for both companies. chicago bridge, you can see when that news crossed, the shares did spike. going down, green mountain. it is the worst performer in the s&p 500, after the company said that its cold brewing system is going to be rolling out or slowly that investors had been expecting. it will be coming out in different phases. will not be in the full retail channel until 2016 holiday season. investors are not very happy. what am i going to do? julie: there are other ways.
[laughter] betty: thank you. now we look at the top stories on the bloomberg terminal this afternoon. we begin in israel where benjamin netanyahu has begun his fourth term as prime minister. he is still not named a foreign minister. he is holding up the post as the in order to get another party to join his coalition. he survived a confidence wrote by a to vote margin -- those by a two vote margin. pharaoh is a 4-5 favorite. no horse has won a triple c rown since 1978. chiles wants to appeal to the social media crowd. they are revamping the look of their dishes to make them appear better on social media.
diners like to take pictures of their meals and then share them on twitter, instagram and facebook. that is a look at the top stories at this hour. earlier this morning, we spoke part of theut what world he is not betting on. >> this year i had the euro for the first time in 13 years. because for the first time ever, there is a crash coming. betty: what makes you think that? inwhat has been happening europe and what mario draghi was saying he had to do. even though he has not done a get my believed he would. i believe that with the oil price decline that the u.s. economy was going to do better and interest rates would rise. we had a euro to dollar 24. that looks pretty smart right you but i always say that
never know you'll be right at the end of the year. betty: smart, or luck? catch the full interview on bloomberg.com. mark crumpton will be joining me in the next hour, talking about the u.s. economy and what david just said. everybody, from the billionaires to the ceos down to the debating ande all confused about what this means for the economy and the market. stockthis is a man whose was up 17% over the past year, 70% in the past quarter. he was concerned about what was coming out in europe, specifically there was some unease about that quantitative easing program that mario draghi undertook. wasn't enough, was it too much? included in effect in a timely manner? investors in my operating
businesses need more certainty with this type of volatility. betty: good luck. you have heard ceos over and over again say we need more certainty in washington, in the data that we are getting, but let's face it here in a new age where there is a lot of uncertainty. mark: very much so. coming up i will be speaking with a panel on what's today's consumer factory data says about when the that is going to move on interest rates. it will not happen in june, probably not july. a lot of people are looking at september. they have the charge, they are looking at the dots. betty: much more ahead on the bloomberg market day. we will give you the inside preakness.he
betty: the elusive triple crown begins tomorrow again with the preakness and the kentucky derby winner american apparel has been described as a freak of a horse. pharaoh has been described as a freak of a horse. this horse really is a freak of nature. talent,s extraordinary the way he moves, it is almost like a cat over the ground.
it is a big cat, like a pu ma. i think he is a standout talent. if he does not win tomorrow or in the belmont, one of issues may be that he is also facing a talented crop of three-year-old. only three-year-olds can beat -- compete, and the whole crop is very good. if he has a bad day, there are other horses who can beat juhim. the kentuckybout derby where he was whipped 32 times? >> i think he was whipped way too many times. i think the horse did not have a great day. jockey is used to exploding he got ahorses, and
little anxious and nervous and kept flailing away. you need to put the whip away, ride this horse with your hands, and write him more confidently. the courses are posted to the outside, so he has to breakaway and not get boxed in. betty: say jockey? >> unless he gets fired. if he whips and 34 times, he will be off the horse. the trader has said do not expect them to get the whip 32 times in the print this. betty: what is your batch that this will be the next triple crown winner? >> he is a big favorite. he would have to win the around, and the odds are
4-1. it is hard for these horses to put together back-to-back to back big efforts in a short time. if he gets it done tomorrow, can he then defeat other horses three weeks away? there are horses skipping tomorrow who are waiting for the belmont. we make this every year such a big deal, but no one has won the triple crown since 1978. is any horse ever going to? are they just too fast these days? >> it is going to happen at some point. california chrome. same jockey. you had very close calls.
you had a horse lose by a nose, via half a length. it will happen at some point. if it will happen this june, we will have to see. such a deep field of three-year-olds that any number of horses could jump up and beat him. betty: fascinating. thank you. much more ahead, it is getting hot in here. find out what the home depot ceo is all fired up about. ♪
mark: coming up on the next half hour of bloomberg market day, ken langone sounds off and tells us what he wants chris christie in the white house. consumer confidence falls this month by the most in two years, is this a temporary blip? --will the fed beef theire forced to raise rate hike this year? mark: and we will check the success of this year's tv's upfront. ♪ betty: