tv Bloomberg Markets Bloomberg June 11, 2015 12:00pm-1:01pm EDT
the title to his son james. we will look at what it means for the future of his media empire. pimm: the president of the european union accuses alexis tsipras of playing games. we will tell you how pimco survived following the departure of bill gross. ♪ pimm: good afternoon. matt: let's begin with a look at the markets. right now, as we speak, we see gains across the board. s&p up about a quarter percent. gaining just a 10th
of 1%. commodities are down this morning. you can see crude is off $.93. gold futures falling half a percent today down six dollars $.70. pimm: let's take a look at the bond market and see what is going on there. the little bit of buying. buying on the 30-year. let's take a look at the u.s. dollar and see how that is performing. the dollar is losing strength against the euro. it is getting a little bit against the pound sterling. the yen strengthening against the dollar. let's take a look at some of the top stories crossing the bloomberg terminal. he has been a commanding force in newspapers, television, and
movies and rupert murdoch is now taking a step back. up his title as chief executive of 21st century fox and he will hand over his job to his son james murdoch. still drive strategy. the international team negotiating with greece has left brussels after failing to reach a debt deal. there are key differences and now the ball is in greece's head of the european union is accusing greece of playing games with its future in the eurozone. whene day is coming someone says that the game is over. think that the upcoming euro group is really crucial. it should be decisive. have no more time. i'm absolutely sure. >> the greek prime minister is
in brussels to name beaning with european officials. prime minister alexis tsipras met through the night with the officials from germany and france. the highest ranking official prosecuted in the chinese corruption crackdown was sentenced to prison for life. the american consumer is getting back in the game after being on the sidelines for much of the year. inppers were back in force may. retail sales rose 1.2% last month. the matched estimates and increase was broad-based. automobile dealers, clothing, and building materials stores were all up. matt: another sign of strength in the labor market. first-time claims for
unemployment stayed below 300,000 for the 14th week in a row. employers are holding on to workers in anticipation of a pickup of demand. are goinggulators after people who raise money on crowdfunding sites and do not make good on their promises. the ftc settled a case against a to buildaised $120,000 a board game that never materialized. --ositively epic bait baseball tantrum to show you this afternoon. torii hunter goes bonkers after being ejected from the game last night. he threw just about everything, including his batting gloves, elbow pads, and his jersey. his twins lost to the kansas city royals 7-2. these to do that all the time.
maybe he did it because of the undershirt. did he have a brand he was advertising? was a marketing suggestion by brendan greeley. coming up in the next half-hour, the imf says it has major differences with greece in key areas. we will get the end i'd on the tense negotiations from ian bremmer, the founder of the eurasia group. pimm: bmw is turning to technology to win more customers. we will tell you how the top-of-the-line, seven series sedan can respond to your hand gestures. pimcowe will tell you how survived a flood of redemptions following the departure of bill gross. we are talking about $100 billion in redemptions. is planning murdoch to hand over the reins of his media conglomerate to his younger son, james murdoch, solidifying the family-run future of the entertainment empire. matt: timing of the move has yet
to be determined. here to discuss the changing of -- martin,ith us thank you for joining us. i was watching previous segments that you did with betty liu. you said it would go this way. that rupert woodhead more back toward news corp. and that james was being groomed to take over this side of the business. he is 84 years old at some point and you have to step aside. with james running the show and chase not so much running the show, what does this mean for the business? is there a change in what they do for cash? investors have loved share repurchase. it is unclear were james has come down on that debate. seems to beme chase
out? is it because he is rupert's right-hand man and james needs to get his own right hand man? >> i know that chase was loved by investors and another that james is like the lot. people have been expecting it. pimm: james murdoch. willful ignorance was the term jim related toe the phone hacking scandal in the united kingdom. is that aarti done and dusted? much done andy dusted for this american-based company. do think that the good thing about the transition is that he has had time to put that behind him. they split the publishing stuff off.
andver embarrassing troubling the whole incident may have been, it did not do anything to compare -- impair his ability with investors. he had a good track record here? he has been at bskyb. he knows how to run a big business. thepublishing stuff publishing stuff was unfortunate, but people remember more what he did at bskyb and what he has done within star. pimm: this has been asia, right? >> india has been a great business. i am cautious for a lot of reasons to do with the secular changes of tv, but if you're
going to be bullish on fox, you love what they are doing in india with star and he has been front and center of developing that aspect. children havethe voiced real this taste for what goes on at fox news. beent murdoch has always strong in his insistence about making money ahead of good taste , for lack of a better term. do you think they will be able to continue to do that? with james have that bent toward making money and not as much a vacant turn about his legacy? >> i'm not going to go to the political world, but from an investor perspective, absolutely. newsare the top rated network. they are killing it year after year. there is every reason in the world to continue the formula. what about splitting up the business? what does that have to do with having a broadcast network in the united states?
>> if you are an outsider looking at fox, you could ask the question, could you optimize value by splitting up the company? could you optimize it by putting .ore money in share repurchase these are things that you can speculate on. i don't think they are going to happen. i think under this family control, they love all of these assets together. todid take some steps rationalize the skies. they sold sky italiana. they have raided a very logical combination where they have a minority interest. not heard them talk at all about any separation with sky business. pimm: i want to thank you very much. us fromrockett joining capital markets. coming up next, the european
pimm: welcome back. the: let's get a check on markets with olivia sterns looking at the best and worst performers in the s&p today. rising citrix shares are on news that elliott management has written a letter to the tord calling on citrix overhaul calls, buy back shares, and so back units. elliott also unveiling a new 7.1% stake. elliott is saying, the stock has
been trading at a discount to its peers. another big performer in the hess -- the most active jailer in north dakota block -- block in shale formation. create hessg to infrastructure projects. on the downside, we are watching transocean. shares are falling after barclays started covering the was a negativers view on the entire sector. the price target is four dollars below where we are trading. the rig market is heavily oversupplied.
let's show you what is happening to shares of chesapeake. gas producer was cut to perform from outperform. this is a note from her friend over at oppenheimer. lower oil prices have been hurting the cash flow. year to date chesapeake shares are down 35%. much for that.ry we have a lot of oil news today. pimm: yes, we do. matt: those opec guys continue to pump. pimm: yes, they do. marchionne is looking for other merger candidates. anhas been working with advisory group to see of investors would be interested in a gm deal.
gm has already said it is not interested. is seeking a plan marchionne is seeking a plan b merger. whole foods smaller chain is going to be called 365 whole foods market. some of the proposed names included clever egg, daily shop, and sprint goods. has been cleared for lululemon founder chip wilson to sell his stake in the yoga wear maker. wilson and his wife own 14% of lululemon. wilson and the lululemon reached an agreement, part of which involved selling his stock. by filing and enables him to sell his stake if he wishes to. that is a look at the top
matt: this is "bloomberg market day." no more gambling. donald the message from task. he is abandoning his neutral role and urging the greek government to cut a deal with creditors. withmf team negotiating greece has left brussels after failing to make a debt deal to help the country avoid default. pimm: when will this game be over? let's get some of from ian bremmer. of a new bookor
entitled "superpower" and the head of the eurasia group. thanks for being here. you were to advise the greek government, the european union, and the imf, what advice would you give them? ian: that is a horrible question. pimm: that is why we saved it for you. ian: we are not ready to deal yet. we still have several weeks. ability ofve the both sides to make it seem like it is more urgent, like it is more of a crisis. if you are the prime minister of greece right now, you cannot cut a deal when you still have a couple of week, where there still is not super pressure. you absolutely need to have the press u.s.rnment hard against the wall as humanly possible, the imf as well, so that when you do capitulate, everyone in greece understands that you did as good as you possibly could. pimm: this is all for show?
rather than anything constructive? they are not talking about overhauling the pension system or the tax collection system. they are not talking about privatizing state-owned assets. substantivea conversation about the details of figuring out things. ian: there have been substantive conversations. you have not seen it on pension reform yet. say theyn't the greeks cannot go ahead and do this? ian: on some of it. the imf today, the reason you are seeing the headlines in the market go crazy is because the imf is formed often said we are really far apart. you are going to see negotiation
on both sides right up until the wire. the deal is going to only last for a few months. matt: the imf has a key role in this situation. we have seen the imf giving advice to a lot of governments, including the fed. do you think the imf should have such a strong role or doesn't need to be reduced? ian: i like the imf having a strong role. i believe they are long-term. pimm: what is their track record? ability to follow through on implementation and assure that governments are going to it here to policies after a deal is constructed, that is a different story. if you ask me, do i think that , the answer the imf
is absolutely yes. pimm: they are not politicians. ian: isn't that good? pimm: whether it is better or worse, it is a question of what is real and what is not real. advice should come from people who don't have to be beholden and lie to you. matt: does tsipras faced pressure from the left or has he lost that support already, now freeing him to make more of a centrist deal? that is why this is still so dicey. he still feels the pressure. ensure that he does not have too many defections. he does not want a minority government. the deal will fall apart.
the biggest mistake he has made his has been some of the people who he has appointed, the finance minister -- who is incredibly smart, but does not have the experience and is not a team player. they do not think that these guys are really up to it. that could be a bummer for greece. ian: when they won with a near majority, these are people who have never governed before and they are not really in coalition. you do have to worry that everyone in the greek government are people with no experience actually working with the europeans. if the meeting goes badly, you don't have a number two or number three behind him that could call the germans. you don't have anything to grease the wheels.
and the germans were facilitating that for a long time. blame it on the greeks. pimm: you talked about the roles these institutions play and you talk about the role of the statesstates the united remained a superpower. ian: indispensable is the notion that if we don't lead, no one else will, and therefore we have to support alliance is, support big institutions like nato and the imf and support our values.
, if the europeans don't want to pay for nato, nato is going to matter less, take big bets on the places that matter to us. -- the ideaamerica is to focus much more of the united states -- we will talk about this in the 2016 election a lot and we seek candidates coming out with each of these perspectives. excellent. thank you so much for joining us. ian bremmer, the head of the eurasia group. and the author of "superpower." pimm: my one choice is to leave it all in your capable hands. matt: we are back with more after this. ♪
a stepmurdoch is taking back. murdoch is preparing to step down the ceo of 21st century fox and will hand over the job to his son james. he will remain the company's chairman. a person familiar with the matter said he will still drive strategy. greecem negotiating with says goodbye. they have left brussels after failing to make progress on a debt deal. there are major differences in key areas and the ball is now in greece's court. the head of the eu is accusing greece of playing games with its future in the eurozone. house speaker john says the asian trade deal is about more than just commerce. he calls the deal away for the u.s. to counter china's economic and what. the house is beginning today's debate ontion -- trade legislation. john boehner says he has tried to compromise. >> we have worked to address the
concerns of members on both sides of the aisle and we have accepted substantive and procedural changes proposed by house democrats. this boat is about doing what is right for the country. the demand for new airplanes continues to soar. boeing says airlines around the world will need 38,000 new airplanes in the next 20 years. that is a 3.5% increase. two out of every five planes will go to asian airlines. actor christopher lee has died. he appeared in more than 250 movies and was best known for his role as count dracula early in his career. he later appeared in "lord of the rings." those are your top stories. , bank of korea policy makers cut interest rates to a
low as the spread of middle east respiratory syndrome threatens the economic recovery there. j.crew is cutting jobs and shaking up management as sales decline. onwill have the latest reports that fiat chrysler is looking at other potential merger candidates. funny thing happened when pimco's $293 billion return fun got slammed with $100 billion in reductions last year. many of the bonds never hit wall street trading floors. investors bailed on pimco after founder bill gross left the firm. they used securities law and sold the bonds to other pimco funds instead. miles is here to look at the strategy with me. miles, let me start with you.
you wrote the story. you said that funds can do this if the buyer and the seller are both winners. how is that possible in this case? basically, the buyer and the seller would agree on a price that is in between the spread on the bonds. lessuyer ends up paying than they would pay only open market. the seller ends up receiving more than if they went through dealer. matt: it is not all about price. a price is determined by how much you want the asset. if you need to hold it, if that is part of your strategy. >> it is not willy-nilly. we have to remember the need of the different funds were very different.
is the one fund needed cash to handle redemptions, the other fund was looking for asset that would help with strategies. they are not going to make decisions that go against it. , the managers are more focused on that responsibility than they have although area matt: they essentially held up the price. everybody except did -- expected a fire sale and pimco managed to withoute bonds -- bonds the fire sale. >> the bonds did fall somewhat in price. internally, they allowed them to get a good price rather than outsiders. how much is pimco in touch
with people at treasury? this is a large amount of bonds. we are talking about $100 billion in outflow. how closely was this regulated? that it was at all. pimco has had a program in place can dote a while with a cross trades between the different bond funds. matt: kevin commented that cross your mind? sense that they would be in contact with the fed, be in contact with regulators? this leadership change was no surprise to them. clearly, these are some of the most sophisticated investors in
the world. place tostrategies in deal with any major redemption. the age that we are in, the short-term shots are more common than they have ever been. they're prepared to meet redemption calls when they come here. to ensure that market stability remains is a huge focus. matt: you do say it was a surprise exit. obviously, there was tension. think pimco gets props for dealing with it very well? the fund's performance improved. shut --lows have
welcome back to "bloomberg market day." we take a look at the european markets. here is mark barton from london. 600 lost morex than half its gains. asc in athens, the biggest gainer in the world -- out of 93 global stock indices. the biggest rise since february. it is all about the banks. look at the gains for the three big banks in greece. the move came before the comments from the imf. still, massive gains. these banks of fall and 99% since the height of the financial crisis. i want to show you the impact of the imf comments on the european
stock market. as i said, they came in our before the close. tsipras about to step up efforts to find reforms and budget fixes. a majorsaid there are differences between us and greece in most areas. that is exactly when the dax heard the news. it is still up i 0.5%. i was going to tell you that it had its best today gain in three year. it finished up by two consecutive gains after falling by 11% in the preceding two months. matt: the bank of korea cut rates to a record low as the spread of the middle east respiratory syndrome threatens to dampen the country's economic recovery. the bank of korea lowered key .nterest rates to 1.5%
the central bank took a preemptive move against mers. the virus poses an imminent threat to consumption. yuan it is set a 17 year high against the currency. the wave of easing in asia continues. the bank of new zealand cut interest rates for the first time in three years. let's go to olivia sterns for the big story of the market day so far in america. olivia: u.s. stocks are moving modestly higher right now. the dow is up by about 0.25%. the nasdaq, little changed. there is concern over greece. there are headlines that talks with greece were going that badly. we have had a lot of economic
data that shows that the u.s. economic recovery is well underway. jobless claims coming in below 300,004 the 14th straight week. good news is good news. right now, a significant move lower, trading at a yield of 2.42%. investors way when they think the fed will go ahead and raise rates. let's show you what is happening in the forex markets. the dollar is rising for the first time in four days. the dollar is rising as its peers fall, in particular. asthma just told you earlier, the south korean fullback that it's rates. perhaps one the dollar gaining a little bit of strength with of
its peers fall. i wanted to end up on the commodities market. oil is moving a little bit lower. down 1.5%. there was a report out from the international energy agency saying that they are not so sure that oil's rally is sustainable because opec's biggest member countries are still producing oil at near record levels. gold futures are down a little bit -- by about 0.67%. there is a fun story on the bloomberg terminal saying that retail investor demand for gold coins is just trying up. copper futures off by about two point 5%, trading at their lowest level since january amid a new report that, once again, you should be worried about how demand there is on the
market. matt: where do you get gold coins? olivia: my mother. they had gold coins under the mattress -- my grandmother did. matt: she saved them and passed them down to you? olivia: something like that. matt: very kind of her. bloomberg news is reporting that wells fargo, capital one, u.s. corp., and toronto dominion are among those interested in the ge have $40 billion in loans. amazon.com is facing a probe into its e-book contractors. contractor may be insisting that publishers cannot give them better terms. the probe is the latest clash with the eu for amazon. it was recently probed about tax loopholes for multinationals. a warning from the international
energy agency. opec's biggest members are rally.ning an oil opec ministers decided last week not to lower output, choosing to defend market share. let's take a look at your top stories. >> i think he has done an excellent job. i have to say he has acted very professionally. diligence and his financial areas. the international monetary fund. on tothe president went say he will announces final decision in december.
joining me now is bloomberg anchor mark crumpton with more on this. midterm elections were held over the weekend. what is the take away? >> interesting. there was some sense that people .ight not be pleased it was interesting about mr. carson's. it did not seem that the president gave him a ringing endorsement? he has cut rates to a record low 3%. the economy has been repeatedly below forecast. inflation has slowed to the lowest level since 1968. back in may, it was a 2.88%.
he said he would accept a second term. matt: is it not the case? you are a political historian. it is know what is interesting. it is not a ringing endorsement. if the president says we stand behind you 100%, you are usually one foot out the door. but we will have to wait and the. you can city interview on bloomberg.com. i have not seen the whole thing yet and i am looking forward to it. matt: if you haven't and you are not still to 70 -- two tech savvy, you can see it on bloomberg television tomorrow. also, we will see each other again at 1:00. we will talk a little bit about
the middle class. is it vanishing? is it disappearing? what can be done absent any legislative achievements. on ing is going washington. does this mean that the private sector is going to come in and fill the void? .'m looking forward to that the author of "american mojo lost and found" is joining me. matt: look at that. he just up for the picture. [laughter] in just all see you moment. retail sales rise in may, but j.crew is not doing well. they are cutting jobs, but will that be enough? stay with us. ♪
for thet a bad year bloomberg retail in text. just going up, up, up. retail, sales rose 1.2% last month, matching estimates. and includes a 1.5% gain clothing stores. one company not doing so well is j.crew. sales fell 5.2% in the first quarter and that has the company cutting 172 jobs and shaking up its women's designers. >> thanks so much, matt. j.crew was doing so well for so long. fashion simple as bad like the tilly sweater and naming a new head of women's design? great merchants have to take
risks. when you take risks, there are often consequences. i think this is really a huge short-term thing. they went in a direction trying to make a shape difference and their classic fit and they identified it and they are making changes. will bethink this something that is long. they are a wonderful company. scarlet: do they need to make a bigger risk or a bigger change? i don't think that is something that is really on the cards. foris an incredible force all of their brands and assets and everything that they do. this is really a more technical issue around products. they have secular tailwinds behind them because all of the international growth. j.crew has kept prices on the higher end. do they hold the line on prices
even as the 30% off e-mails flood people's mailboxes? price andy hold deemphasize marketing the luxury side of their business. scarlet: at the center of j.crew is mickey drexler. could it be that an argument is made that he is really good at and maybe nothing as good as sustaining it? >> not at all. he is one of the greats in the industry. there is a lot of space ahead of him. scarlet: j.crew went private last year because mickey drexler
wanted it to. they were considering an ipo. does it change what they are planning to do. this is predominantly a north american business. they are just dying to think about those things right now. >> there are a lot of things for them to do. does the bad press spillover globally? >> no. people know them for the reputation. and ition is repetition think this is a blip. scarlet: within j.crew, one of its units doing well is made well. product, theell way it is defined, what it says to its customer and the consistency of that message continues ongoing.
madewell had the consistency of the message. scarlet: a bit of a stumble on some fashion risks. matt, back to you. matt: i did not realize that we had a j.crew across the street. scarlet: i did. matt: i have been working here for 10 years and i never saw that. we have a tour de force of 2016 candidate interviews. today, we are interviewing rick santorum and scott walker. tomorrow, we will be entered to viewing -- interviewing john kasich him lindsey graham, and mitt romney. ♪ ♪
preparing a step down as ceo of 21st century fox and handing the title over to his son james. we will talk about what it means for the future of his media empire. matt: fiat chrysler is looking at other potential merger candidates, not just general motors. mark: what can be done to reinvigorate of the middle class -- middle class. hello, i am matt miller. mark: stocks rising today. bolsterings confidence. all of the major averages are in