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tv   Bloomberg Markets Americas  Bloomberg  November 27, 2017 12:00pm-1:00pm EST

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welcome to "bloomberg markets." ♪ from bloomberg world headquarters in new york, go to top stories in the bloomberg and around the world that we are following. cyber monday is in full swing and stocks are admit securities as investors focus on the busy week ahead, particularly for fixed income. the koch brothers are back. meredith corporation is all ofng time inc. and its brands for $1.8 billion in cash. more details a little bit later. past $9,000. blows the cryptocurrency showing most no signs of slowing down. is it just the beginning or the bubble about to burst? all that in the next 60 minutes. asgail doolittle is with us the trading concludes at the end of the month.
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abigail: we looking at the end of november. we are at major averages and we are looking at mixed trading action when we had been looking at games for all three major averages. putting in a set of all-time highs, but behind this choppiness is the fact that we are looking at small declines from s&p 500 and the nasdaq . a report from tokyo broadcasting system saying the japanese government received a signal that is same as north korea's preparation for a ballistic missile launch. a little bit of a risk off tone to that message. not sending stocks spiraling down, but we will be tracking the story. we are coming toward the end of the month of november. for the dollar, we might be looking at the first monthly decline for the month of november in a decade. down nearly 2% on the month, on pace for a source month since july. not clear what's behind it. perhaps with the change at the
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head of the fed and that how will b how will will be more dovish than expected. let's take a look at the commodity complex and we will see some weakness. not down in the big way, but nonetheless down with the dollar. the declining dollar should boost commodities. take a look at copper down more than 1%. crude is down 1.7% come on pace for its worst day since early october. this is ahead of the opec meeting and investors are wondering what will happen. there had been a bloomberg scoop on friday talking about russia and opec. the output cuts that could be the case. investors are uncertain as that report had taken oil to a two-year high. even wheat is down 1.2% so it's interesting to see that. one bright spot on the session -- ge. ge is having its first
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three-day upswing since that disastrous third-quarter earnings report. they slashed guidance and cut the dividend by 30%. seem toestors because the sleep heading back into the shares of ge. finally let's take a look at some other stocks, certainly helping the dow. we looking at lowe's and home depot. lowe's is helping the dow. behind this, we had a strong new homes report for the month of october. that was a bit of a surprise. it appears that there is still strength in the south as they rebuild from this hurricane. this is giving the home-improvement stores a bit of a boost. julie: thank you very much. sorry, vonnie. we have some breaking news on mexico. the finance minister is resigning from that post. this was reported earlier by bloomberg that he was planning likesign and it looks
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there is now speculation that he could become the ruling institutional revolutionary party's candidate for president. his resignation has been officially announced. it is not yet clear if you need will become that candidate. his replacement is the ceo of pemex. se gonzalow jo santonio. as a little bit of a political mexico ahead of the next election. we will keep you posted on this and it does not look like it there is much currency reaction because we earlier reported that this was likely to happen. vonnie: a little tiny strength for the peso, but it has been that way all day. another round of elections. it's going to be fascinating. markets are keeping and i'll capital here and the u.s. for two reasons this week. president trump is set to meet with republican leaders in the senate finance committee.
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that's ahead of a marathon debate on the tax reform bill. chairly that, but the fed nominee is facing senate lawmakers for his confirmation hearing tomorrow morning. here with more on what to expect out of all this is the head of global interest rate strategy. thanks for joining. what would be the one question that you would ask jay powell tomorrow from either side of the aisle? priya: i have lots of questions for him because i think the fed is looking at immeasurables here. they are hard to measure and hard to determine. be if we doe would get a tax bill, how does the fed respond? i think chair yellen was pretty clear that the economy does not need fiscal stimulus so the fed would high castor. ke faster. the fed is projecting three
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hikes in 2018 without much of the fiscal stimulus. should we be looking at for hikes? the market is always going to be a little less than the fed. i think that's a big market question. do they hike more if they get anything from congress? julie: these are all great questions. do you think he will answer them tomorrow? what kind of insight you think we will get from him? it's one thing to anticipate questions, but it's another to anticipate how forthcoming and verbose he will be in his answers, . priya: with any sort of testimony an in front of congress, he will have to not stake out a claim because these are very model driven issues. i think what i will be watching is how much does he tv it. deviate. with the way that the fed has been operating the past couple of years, if that is the way he will go going forward, the market will be able to handle it. if we are looking at some change here and the market is not
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looking at jay powell all that different from yellen, but if he stakes out that he's pretty different and terms of some of these issues, i think the market is not going to find that easy. vonnie: no, and it's very interesting. to a nobelaking winner earlier today and he was same. the little take a listen to what he had to say. >> the fed has been so timid from the easyoff trillion.the $20 that's a shame because i think they should be more forceful and be selling off long-term debt at a smart pace. vonnie: you are talking about maybe an extra interest rate increase. is that also in the cards? priya: if we are talking about changing the balance sheet, the
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fed has communicated that pretty clearly. there's not a lot of disagreement from the minutes. maybe they should be selling assets, then i think you would be seeing big reaction. the fed has been slow and normalization. where is the inflation? i think that will be the big question next year. the fed expect the pickup in inflation. do they get that? if you don't get that, what is the threshold for may be slowing the pace before we fully run off wor or hike? i don't agree with that yes option -- assumption that we should go higher. julie: let's talk about the curve or lack thereof. if you take a look at the bloomberg, we have a simple 530 spread. i know you have been watching that. it's the same story wherever you look that we are seeing flattening. predictedthat you earlier in november that we could see a trend of 65.
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right now we are around 69-70. is that still your outlook? there are people calling for an version next year. priya: we are not in the inversion camp. the five-year will selloff. , i have good strategist extended my target and i making it closer to 50. the main reason for that is that the front and basis of the hiking pressure while the long and the staying low because of global rates. global rates and the lack of inflation keeps the long and anchored. i think the other question is investor minds is we don't know how the treasury will fund it. outthe treasury is coming clearly and saying they are not issuing a whole lot of long in bund and bonds. i think that is being taken off the table. and we we get that cut get more deficits next year, we should see more in the zero to five-year part of the curve. the curve can keep flattening and that would be a clear fed
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policy mistake. run off andortfolio then i think we are talking about an version, but that's not our call. we are still thinking to hikes next year. julie: really quickly, you don't think tax cuts would boost gdp ? priya: i think inflation could be a little bit of it. the reason we don't have a big gdp boost is that we are at full capacity. the economy is at full capacity. we have a .2% increase of 20 basis points and increasing gdp, so it's a small increase. fed would potentially perceive that as additional stimulus, which of the economy does not need. one additional hike is quite possible with tax cuts. julie: thank you so much. iya misra is td securities head of global interest rate strategy. a programming note -- we will
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bring you coverage of jay powell. vonnie: let's check in now on the bloomberg first word news with mark richt and. mark: mick mulvaney, present trump's pick to lead the bureau, has told steffes to disregard leander english. part, "if you in receive additional communications from her today, please inform the general counsel." miss english filed a lawsuit sunday night in federal court in washington. she cited the dodd frank act, which created the cfpb. she said that as deputy director, she became the acting director under the law. president trump will not campaign for alabama's republican senate candidate roy moore. that is according to the associated press. roy moore hasn' has been accused of sexual is conduct. specifically campaign
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for him, but he blasted the democratic candidate in the race. the special election in alabama is the sum of 12. -- december 12. angela merkel says she is willing to copper must to get reluctant members on board. ofkel says there are number urgent issues facing germany and the best way to face them is with a stable government. the current hurricane season in the united states has been the most expensive ever. that's according to disaster modelers chuck wasson and mark johnson. they said hurricanes cost $20 billion in damages this year. for the first time ever, three category 4 hurricanes, the second strongest category, hit u.s. soil. global news 24 hours a date howard by more than 2700 journalists and analysts in over 120 countries, i am mark richt in. this is bloomberg. vonnie: thank you for that. congress coming back from thanksgiving with a full plate.
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how gop leaders plan to get their tax plan to 50. that's next. this is bloomberg. ♪
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♪ julie: this is "bloomberg markets." i'm julie hyman. vonnie: and i am vonnie quinn. congress trickling back into washington, d.c. with 12 legislative days until the end of the year and 11 more years of funding for the federal government. desperate for a legislative oil, it's in now or never moment for the gop tax overhaul. we are joined now by laura davison from capitol hill. list and may be up to a dozen senators that were a no on this, but a soft no. where are we now? laura: this is the week that
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senate leadership is hoping to pass the bill. they are listening to senators withn-one and meeting folks like senator susan collins who is concerned about the individual mandate. maybe they are worried about state and local the directions that the house passed. it's something they will have to figure out at some point. senator collins is looking to see if that will happen now. also meeting with the deficit side folks like senator corker and langford to make sure that this bill will meet their standards is not cause long-term fis fiscal problems. julie: susan collins has reservations about the mandate repeal. rand paul once the mandate repeal. it is in the sam senate version and not the house version. what are you hearing about how that debate is going to end up? laura: it's really going to come
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down can you get to 50 votes in the senate with that? the only hard know is senator susan collins. lisa murkowski who voted against the obamacare repeal this year said she would be for a bill potentially as long as there was other market stabilization's for insurance markets. i would bes a vote, open to repealing individual mandates in the tax bill. at that is the case, they might be able to smooth sale this through without keeping that provision and. that gives him $320 billion of savings. if they take that out, they will have to figure out how to make that up, whether that means delaying more tax cuts or having the sunset earlier. vonnie: the congressional budget office says that they have not been able to score this yet. how then can you make the argument that growth will pay for some of these tax cuts? how can you in good conscience come out there and support this pretending you know this is going to be true when you don't have any figures to back that
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up? laura: this is really the fundamental intellectual argument we will see play out this week. the joint committee on taxation won't have a score that details the macroeconomic effects. how much does this grow the economy? this is what folks like bob corker have said. he wants to see that their reasonable estimates of growth that offset the tax cuts that are happening. there are outside groups, but each outside group comes with a little bit of a specific event and is not an official score. it's unclear whether these people will vote for a bill whether they have firm data to back it up. julie: is there any talk of when the cbo could get that to members of congress or is it growing up its hands and saying we just don't have enough time? laura: they are definitely working hard to get it done, but this could take several weeks. the bill was introduced a couple weeks ago and it has undergone several revisions since then. folks at the cbo have not had the time to get it done.
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realistically if they were going to do list to the standard they like to, they would need several more weeks. that is unlikely given a vote that could happen thursday or friday this week in the senate. vonnie: laura davison, thank you. the president is meeting right now with some members of the senate finance committee beginning in about 10 minutes. that was laura davidson of bloomberg tax. julie: it is time for the bloomberg business flash, a look at the biggest business stories right now. , bravo is buying barracuda network for $1.6 billion. it 16% higher than barracuda's closing price on friday. barracuda offers cloud-based security and data protection plans. the transaction is expected to close next year. cable companies have a new strategy when it comes to streaming video services such as hulu. if you can't beat them, join them. operators comcast and charter are in talks to offer hulu through their set-top boxes. viewed theanies once
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streaming companies as existential threats to their businesses. that is your business flash update. the companyl ahead, that owns fortune and people magazine will have the owners. among those owners are the koch brothers. meredith buying time inc. for $1.8 billion in cash. this is bloomberg. ♪
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vonnie: this is "bloomberg markets." i vonnie quinn. julie: i am julie hyman. on wall street its merger monday and it's time for the merger report. meredith has agreed to buy time inc. for $1.8 billion in cash, supported by a cash infusion from the koch brothers. here now to talk about the next chapter is ed hammond. to me the crux of this -- at least this is the buzz in the media -- the koch brothers said
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there is not going to be any editorial influence, but no one seems to buy that. ed: no one seems to buy that. right-wingotoriously guys and a obviously buying a media property that is predominantly to the left, but fairly in the center. the expectation is they would try to exert some influence, but that said, they are telling us this is just the financial investment. meredith came out with a statement saying there is no influence, saying there is not a role despite investing $650 million. they have gone out of their way to supposedly put a layer between themselves and any editorial control. vonnie: what is the play? ed: for the koch brothers, this is a straightforward financial investment. i think the play for meredith is very simple. they are taking an old line that's ina business
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secular quicksand and marriott to a business that's doing much better in terms of a tv product that's relatively successful. they sort of cracked the digital advertising model as well. the one thing that's going to be interesting to see how they monetize this and they said they're going to do $400 million of synergy in the first two years. that suggests a lot of job cuts. vonnie: could there be some kind of -- we note that the coax are going to get a lot of people elected in the midterms and not just in the house and senate, but way down ballot. can local media presence in tech that in some way without -- impact that in some way without an over bias or whatever? ed: this is a fascinating question. they said they are not going to have any influence at all on time, but does this investment along said meredith, does that approval over
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meredith that has a completely different kind of stable of magazine and tv products? obviously we know that they love having political influence. they haven't talked about almost nce if you were to become president. the road will never be questioned throughout this in terms of how they use this investment. at least for now on the face of it, they are being going to be completely hands-off as regards to time. julie: let's also fascinating about that is that even if they are hands-off, we are seeing more and more media control from more right-leaning investors. sinclair would be another example of that. don't they now have a more conservative investor? ed: that's right. you look at how successful the right-wing sector is doing particularly under trump. you look at breitbart, which has been a runaway. not just ideological but also financial.
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ed: exactly. it's a very successful product. we have seen a more recently with all the news around fox and whether murdoch may or may not sell. the one thing that time has hold onto is fox news. you have seen this enormous migration of people towards news outlets that you would say are traditionally quite far right. that would match up with the koch brothers and their politics. julie: ed hammond, thank you so much. lots to talk about with media and m&a. vonnie: speaking of media tycoons, coming up, amazon with the battle between amazon and the retailer kicks into high gear today. jerry storch will be on. this is bloomberg. ♪
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vonnie: live from bloomberg world headquarters in new york, i vonnie quinn. julie: i am julie hyman in for shery ahn. this is "bloomberg markets." let's get a quick check on major
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averages as we have a little bit of a dip on the s&p and nasdaq the dow ca. the dow continuing it run. sort of a drift in the markets as the tax debate continues in washington. vonnie: now let's get us to the first word news this afternoon with mark crumpton. mark: the u.s. supreme court has steered clear of the controversy over guns for now. justices turned away to appeals from gun advocates. one was seeking a constitutional right to own a semi automatic assault rifle. the court also refused to let florida openly carry pistols in public. syria and its allies continue to deny allegations of carrying out the chemical attack in april. at a meeting of the organization of prohibiting chemical weapons, the syrian foreign minister denounced an investigation launched by the global watchdog group. more than 400 migrants, including 90 and children, have
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been rescued from a boat off of tripoli. all the migrants received medical assistant. the united nations high commissioner for refugees estimates nearly 3000 people theng to reach europe via mediterranean sea have lost their lives so far this year. it is the biggest online shopping day of the year here in the united states according to one estimate. monday is on cyber expected to rise on the 17% from a year ago to $6.6 billion. online spending during the holiday season is projected to make up more than 11% of total retail sales and that is the most ever. news 24 hours a day powered by more than 2700 journalists and analysts in over 120 countries. i am mark crumpton. this is bloomberg. julie: bloomberg news has learned that ubs is withdrawing from an industry pack that would
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allow financial advisors to change companies without being sued by former employers. that move further destabilizes the accord after morgan stanley left last month. michael moore is here with more. first of all, what exactly is this a court and how has it worked and how long has it been around? michael: it was kind of a dr -armament.a de we will not hide all these financial advisors and lawsuits over poaching clients from one place or another. it really allowed the free movement of advisors between these big firms. ist has happened over time in the last for years, a of the big firms have scaled back their outside hiring. they have found it cheaper to hire young employers and groom them. they're not getting as many of the benefits from this accord and a lot of the smaller firms
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that have signed up are doing a lot of the poaching. they are benefiting from the accord. you are seeing some of the big firms pull out of this. vonnie: how big is this industry in general now? it feels like it's not maybe as lucrative or sexy to goin into. michael: it depends on which section of the market you are in. the high end of this market serving the ultra-elite is very attractive. firmsve a lot of competing for those very high-end clients. in the middle market, your typical wealthy individual, you are seeing a lot of competition whether it's from independent advisers or from these new upstarts or the robo advisors. you have passive etf's which are managing their own money. there's a lot of competition on , but they're still has been an explosion of global
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wealth so it is a growing business to manage that well. julie: morgan stanley just pulled out in october. ubs is doing it now. do we expect lawsuits to start? pulling out of the pack is one thing. aggressively going after former employees for example is another. michael: it gives them that option. ofie: was there a a lot suing? michael: it is something certainly that we will be watching to see, especially if some of these independent advisor firms try to poach from the bigger shops. whether there will be more suits or arbitrations over these exit agreements. vonnie: are shooting themselves in the foot a little bit? by pulling themselves out now, that opens the floodgates so that have to offer massive incentive packages to get them to move. michael: right after the crisis, they were offering very
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attractive to people and you saw a lot of movement in that 2009-2010 timeframe. a lot of people still on those deals because it's structured as you get this upfront bonus and then you work it off over time. there was a lot of movement in , but recently there has not been much movement in part because the firms have not been as aggressive. as you say, that may not be the case forever. maybe down the line they may have to revisit some different kind of accord or restructure something if they want to do more hiring from each other. for now, it seems like they are content to hire more junior people and work their way up. julie: michael, thanks so much countingll be on you to let us know who pulls out from this agreement. vonnie: black friday is over, but the feud between brick-and-mortar and online retailers will reach fever pitch today.
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amazon and walmart trying to outdo each other with cyber monday deals. e-commerce spending is expected to jump almost 70% from a year ago to $6.6 billion today. this is according to estimates from adobe systems. our own michael mckee saying that these numbers are guesses at best. these projections are to be taken somewhat with a grain of salt. torch weighed in on the beginning of the holiday shopping season and what it means for retailers. jerry: it was interesting. i saw a lot of traffic. this was a very robust weekend. black friday remains a mark a event -- marquee event in retail and cyber monday in online retail. we saw huge increase in sales across retailers over the weekend. was not as expected was that brick-and-mortar were resilient. some was a decrease at retailers. someone up and someone down.
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by and large, there were a lot of people in the store s. when you add that with the double-digit growth online, you saw a big increase in black friday spending. >> is it enough? this is the s&p general index at the debt outstanding with $222 billion. that redline is the average and we are well above that. my question of the week and is -- the weekend is is it enough to offset the massive amount of debt that's coming due in this industry? jerry: it's much more complicated than one weekend results. black friday is holding up and it's the holding up for the whole year. people are coming out and enjoying it and shopping for the bargains. retail faces a very rightormational period now and an underlying causes the growth of the internet. what's happening at brick and mortar that they are losing some of that business. they are getting it back through some of their own growth online. sites like macy' or or all the others.
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that unfortunately comes at a much lower profit rate. even if the sales hold up in these traditional retailers, their profitability declines because frankly nobody makes money on selling goods online and selling to people houses. >> you have had an incredible career and i want to talk about toys arrest and your experience -- toys "r" us and your experience. are there any lessons as you look back on things with toys "r" us? is there a lesson that these retailers need to be applying? jerry: i would never second guess the current management. it's a very leveraged situation as many of these situations have become. i think you have seen the private equity by a large is now shunning retail as an investment because it used to look like a place with tremendous cash flow generation and now looks like a place that requires huge investment in order to win the ongoing battle taking place. it's just the huge growth of amazon. you go back five years and
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amazon is 4% or 5% of the toy market. today they have four times that much. it's either 16 to 18%. they had to take that share from somewhere. they took some of it from target , toys "r" us, and elsewhere. >> what happened with toys arrest was like the retail equivalent of a bank run. that's a conversation i had with many people around the country and vendors one by one wouldn't deal with them anymore. needany companies to maintain the trust of vendors to maintain the life blood supply of business? jerry: it's important to maintain those relationships. retailers always run into trouble when vendors balk. when they understand you can pay them, they prefer to sell something and make money rather than not to sell something. vonnie: jerry storch on "bloomberg daybreak: americas" earlier.
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the happiest place on our is preparing for life after eiger. who is the next contender for the next disney ceo. that story next. this is bloomberg. ♪
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julie: this is "bloomberg markets." i am julie hyman. vonnie: i vonnie quinn and now it's time for our stock of the hour. teaming up for a licensing deal for multiple sclerosis drug. analyst call it a win-win for both sides. shares were up as much as 5% this morning and they are now as up 2% as far as i can tell. joining us with maurice taylor riggs. analyst from ever core saying it was a win-win deal.
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makes strategic and financial sense for them to partner up. it is down 2% like you said probably because of the terms of the deal is maybe what this comes down to. biogen gets exclusive worldwide license to commercialize. they will pay a royalty in the midteens. mes will be reimbursed for 50% of the development costs, but buyers are saying they give out too much up front and they could've taken market share instead of takin teaming up with biogen. it's good for biogen. they had what was a minor overhang in terms of the competing drug that they have on the market. inse sales are about to peak 2019 at just about $4.2 billion. this sort of eliminate the minor overhang. this extends the patent life and they can maintain our could share in the multiple sclerosis base saw analysts are certainly excited about biogen. julie: in the statement this
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morning, the ceo said that the doing this would allow the company to refocus on other drugs in the pipeline. what areas are they looking at and what drugs are we talking about? taylor: they are traditionally focused in the psychiatry area. as we know with the opioid crisis, they have done very well and expected to increase market ofre as a percent of sales total revenue from 20% to 38%. they also have a drug that treats schizophrenia so this two-pronged approach help them in the past and the ceo says they can continue to work on that and perhaps return to profitability. long askey for them as her current marketed drugs continue to perform as expected. in terms of the pipeline, a depression drug, they are looking at fda approval in january so a lot of things in the pipeline can make or break the difference for these companies. vonnie: al ks is the ticker. that is taylor riggs.
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julie: disney has until next summer to find a new ceo to seat bob iger who insists his retirement for real this time. now a contender is emerging. he oversaw the companies debut in shanghai. we are joined by the reporter who broke the story, christopher paul merry from los angeles. how did he emerge as a possible successor since he has not been someone talked about before? christopher: two reasons -- one is that they went through a lengthy succession process earlier and a lot of the people who worked as prime candidates ended up leaving the company. tom stags was the previous heir apparent. he also left last year. they lost a lot of that bench that people were thinking would,. his performance has been really
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strong and he has the most well-rounded resume of senior management at this point at disney. the parks division has been on fire lately. it has been the strongest performer of all the disney units. vonnie: on performance alone, he's really standing out. before that he was head of consumer products and head of distribution. he has been around the company for a long time. how might he be accepted as a successor by investors? christopher: i think that investors at this point would look at him as sort of a seasoned veteran who has proved himself and understands the disney culture. i think he would be a sort of safe choice and investors would react positively. julie: chris, we jokingly said in the intro that he says he's really leaving this time. this has been a problem because potential successors have been leaving. what do we know about that? how much conviction he has an investors have in iger finally stepping down? christopher: since i started
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ago,eat five or six years he was originally supposed to retire two years ago. now it's july 2019 and it's not that far off if you think about wanting to give investors and employees the sense of who's taking over. he has three times postpone his retirement. he has been emphatic in public statements recently that this is it. vonnie: how is his name only coming up recently? he would seem to be the perfect contender reading about his bio from your story. christopher: disney has played this thing close to the vest. they're are not giving away anything about who is being considered. bob iger takes this process very seriously. they are very tightlipped and its a very behind-the-scenes process. julie: as we see all this consolidation going on in media like meredith and time today for
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example, do we have any insight into his experience with m&a or does he have any experience in that department? christopher: no, he's not a big m&a guy. people considered a candidate was the head of strategic planning at disney. he is the architect of a lot of -- big deals like lucid film lucasfilm and marvel and all that. he does not have the operational experience that chapek does. he has run two of the largest divisions and proven himself at that. that was always something critical in the succession process. iger would move people around to give him that experience of managing people. vonnie: thanks. julie: chris is our los angeles bureau chief for merger news. vonnie: it is time now for a latest bloomberg business flash. a look at the biggest business stories in the news right now. oark capital is raising its
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bid for buffalo wild wings. they are offering $155 a share. that would value the restaurant chain i close to $2.4 billion. the opening bid surfaced around november 13. the firm owns arby's and investment chains like carvel and cinnabon. shakeup at teva pharmaceuticals with three senior executives leaving at the end of the. they will merge the two operating units -- generics and impotence drugs. the company has nearly $35 billion worth of debt. that is your latest bloomberg business flash. julie: coming up, bitcoin. we are talking about it again. it's approaching $10,000. the cryptocurrency is up more than 45% just over the last two weeks. what, if anything, can slow it down? from new york, this is
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bloomberg. ♪
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vonnie: this is "bloomberg markets." i am vonnie quinn. julie: i am julie hyman. vonnie: bitcoin well on its way to meeting its forecast mentioned on "bloomberg daybreak: americas" last week. >> we and a $10,000 at bitcoin and we and the you're close to 500 and theory. vonnie: still another few percentage points. to weisenthal joins us now talk about what might be ahead for the currency. the thing is we don't know. they could crash tomorrow. joe: it could crash 80% tomorrow. i noticed over thanksgiving that mike nova grad tweeted that he was thankful for a number of things like the macy's day parade and he was sure to give that thanks. , his targets are
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basically almost already here. julie: we have seen more retail investors. about just guys talking it. it seems like everybody's talking about it and it seems like we are at taxi driver level where your cap driver is recommending it. joe: i kind of think like this with mostkwards mobile start with something that wall street people get into mma fan out into the world. the next thing you know is that this that famous seen in "the big short" where he finds out that there's a bubble. there's tons of people in the real world who have bought cryptocurrency and guys like mike are still relatively rare. in the new thing, they would be like the stripper. vonnie: shouldn't people be going around screaming at people to get out of bitcoin and other cryptocurrencies if they are in them? joe: probably not.
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there is an evangelicalism about this. this kind of like this religious fervor. people get into them and they just hound their friends and families to buy themo come up too. this probably happened at thanksgiving where a student comes back and tells how much money they've made and how their parents. there will several thousand sign-ups. i think it was 300,000 or something. this evangelical thing where everyone's tried to get more people into it. julie: you have looked a lot at the history of other bubbles. this one is different because it's almost crowd sourced. it's like the social media age. does it always sort of end the same way? joe: no, they don't always end the same way, but they always end and painfully. the important thing to recognize is that it's just really difficult to call the top of them. you see these signs here and
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there like someone said this and my taxi driver said this. it could go up another 50%. you think back to and there were signs in 1998 of people losing their minds over it. it went on for another two years. while they do ultimately end in tears, it's super hard to know what you will be the one holding the bag. vonnie: are we sure this is going to end in tears or is there a lot of us with egg on our faces? joe: there's going to be a lot of people in tears either way. julie: on one side or the other. joe: on one side or the other. [laughter] i don't know. the future is tough to tell. julie: it's tough to tell whether wall street will get more deeply into it. once it becomes more institutionalized, they could. vonnie: what would be the level in which we would they take -- need to take it seriously? joe: every day this new stories about it. it's fairly small as a
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thing. the total value of all bitcoin is somewhere around the level of ge. we don't talk about ge every day. uniform was a stock going up, we would not talk about it every day. the speedde and even of the acceleration aside, it's the newness and unfamiliarity that drives a lot of conversation. the zeitgeist -- well play. vonnie: joe weisenthal, thank you for that on bitcoin. julie: still ahead, john emerson, former u.s. ambassador to germany, will be here. his take on the political standoff coming up at 1:00 p.m. vonnie: go on to tv to see all of our interviews this week on bloomberg. ♪
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in washington, 6:00 in london, 2:00 in the morning and hong kong. i'm david westin. >> and i'm julie hyman. welcome to "bloomberg markets,
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balance of power." david: here are the top stories we are watching. getting to 50, the senate returns from the break with republicans scurrying to make sure that they have their by thisof tax overhaul thursday. who is in charge question mark not one, but to acting directors ignore theff to other. next step, the d.c. federal courthouse. angela merkel goes back to the drawing board. once again working on a coalition to govern the country. the party said they didn't want to team up with ms. merkel again given how badly it worked out the last time. ♪ davi


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