tv Bloomberg Surveillance Bloomberg January 3, 2014 6:00am-8:01am EST
overnight ising obviously the snow and how it has impacted the morning commute. thousands of flights were canceled, tom. the li ee, a road i spend multiple hours on, east of new york city to get to long island, was shut down, so a treacherous morning commute. most people look like they are staying home. the roads were pretty quiet. data, 9:45 a.m. not that exciting. auto sales are a big deal. we get throughout the morning, released from the individual carmakers, and then at 5:00 today, we get an aggregate number from the government. at 2:30 p.m., rockstar bernanke takes to the night -- takes to the microphone. >> bernanke with clearly the most important speech, but we philadelphia.
jeff lacher speaks out of richmond. and jeremy sky is speaking as well. pour the tea and open the bars in philadelphia. >> rockstar ben bernanke? >> it is his final speech, and it is a big deal. you wonder if he will go back to princeton after his tenure of duty. difficulties yesterday to begin the year. stasis right now. the 10-year yield under 3%. we come in, the euro, that weak trend, and you see all currencies adding today off of the drama -- you see all currencies ebbing today off of the drama.
sub 1200.ers, we are up about $32. we made it to 3.97%. sterling we will talk about in the forex report. scour the web -- got out a snow shovel, braved it from brooklyn. erik schatzker with the front page. >> east coast, threatening blizzard conditions, disrupting travel. highways are closed, thousands of flights have been canceled. areas north of boston got 21 inches already. forecast, meaning temperatures will feel much colder than the thermometer shows. new york city -- it is 11 degrees. placid.low, lake bonnie snyder helps us out as our meteorologist. what has struck you about the storm?
>> cold wind -- i mentioned we were not seeing the most snow we have seen in a snowstorm, but wind gusts up to 45 miles per hour is stronger than tropical storm strength. >> much snow shuts down an airport? >> there is not a formula for that. the wind can make those monstrous snowdrifts that can pile up five feet. >> is logan open? turcotte logan -- >> logan is not. flights have been canceled, even more delays than that. they will take a while to catch up. >> walked us through the day. what is today, friday? friday. where are we? the week it -- >> does he taper off in the afternoon? >> it does.
we will see snow on the ground especially in the new england area. it will take a long time to plow and to shovel out. the wind and the cold temperatures that will get colder. with the windchill factor dropping down to zero in some locations, it makes a treacherous to clear out. >> we go to bloomberg surveillance. isn't it?of january, >> i don't know what everybody is upset about. it will be over in a few hours. ,o some tobogganing cross-country skis. >> it is making travel tough. >> i remember coming to new york city when i moved here in 2005. people worked in the old bloomberg building and used to cross-country ski to work. it is fantastic. we should have more of that. bonnie, you do such a responsible job, and rob on bloomberg radio. have we overhyped the angst?
>> no, not when we read about the accidents that happen and people lose their lives. he will take it seriously and i am loud that the roads are shut down and people are listening to the warning at not traveling today. -- and i am glad that the roads are shut down and people are listening to the warning at not traveling today. >> a significant vote by boeing workers today. unionized machinists, particularly in the seattle area, prepare to vote on a contract extension tied to the boeing 777 airliner. thousands of jobs are at stake here. .he job would cut benefits is this the biggest deal in 10 years for boeing? is it a huge deal or just another argument? >> this is a very big deal for the union because what boeing 777x to is shopped the
a number of states saying what are the most attractive credit and tax exemptions. >> do you think this one can be used as -- >> without question, this could be a precedent-setting incident, which is why ralph nader is all over it. facebook is being sued over allegations it intercepts users private messages and profits by sharing the information with advertisers and marketers when users compose messages that include links to third-party websites. tom is getting agitated here. information is searched for to profile. violating the electronic act andations privacy california privacy law. >> are you really that surprised? >> we believe the allegations are without merit and will --end ourselves vigorously
facebook. who is suing them? >> you are posting yourself publicly, private pictures, links, articles that you like. what is the expectation of privacy? that would be at the center of this lawsuit. what is your expectation of privacy? >> my question is -- >> who has filed a complaint in san jose? >> i don't know. look for it this afternoon and this evening as well. cory johnson in the team i am sure will have perspective on it. we need perspective on the american juggernaut general electric. we will do that in a bit. important union relationship. we want to bring you up on in the manufacturing renaissance in america. thrilled to have you here, nicholas. thank you for coming through the
snowdrifts. how big a deal is union breaking for industries? once and foring all to break the washington state unions? situation isat the oft boeing's preponderance manufacturing in the northwest around the seattle area has caught up with it. the union there is obviously looking at a strong backlog for the company and the industry, and boeing has already moved for over to the east coast -- i think they are clearly trying to reset what has been a legacy set of benefits, particularly with regards to pension, and i think if they are successful with this, i don't think it is a major change. caterpillar has already done a lot of this with their workforce.
>> this goes for detroit and also to windsor, ontario -- union scaling auto versus the new scaling in auto. how much does a union guy make per hour with airline manufacturers? >> i would imagine that if there is some place that differs, the difference between south carolina and seattle is probably 20% to 25%. not extraordinary, but it all adds up. i think the other thing here is work rules, trying to get the flexibility with regards to how to apply the workforce. job classifications. a lot of this has been done in tougher companies. ge is a tougher company about this. for are moving out of erie locomotive manufacturing. >> good to have you come in using the snowblower you used this morning. nn with us.
company news with erik schatzker. >> the request to block pigments link to it -- the requested block payments linked to the gulf oil spill. the king of the bond market, bill gross, was not the only one to have an off year. pimco had its worst decline in almost two decades. gross misjudged how the fed would scale back asset purchases, but at the same time pimco funds with $10 billion in peers inailed their 2013. and you will soon be able to buy cheerios without genetically modified ingredients. general mills says it is bowing to consumer pressure and has been making original cheerios, the original flavor without gm
o's for several weeks. >> could you tell the difference? non-gmo cheerios? >> i don't know if you could detect it, but parents will be happy about the change. >> i am told i the controller that it is gluten. >> are you are in a gluten-free diet? >> i am on a gluten-free diet. bonnie schneider will continue on the weather. it is blizzard across the northeast. also, espn and connecticut will be hosting the bloomberg "surveillance" doughnut bowl, sometime in january. worldis the snow outside headquarters. good morning, everyone. ♪
>> it is a storm. there is new york city -- or philadelphia, rather. philadelphia, pennsylvania, host to the american economic association. charles plosser seeking this morning. ben bernanke -- speaking this morning. lasternanke, arguably his speech. challenges in figure the via -- in philadelphia this month. >> erik schatzker. cristina alesci sitting right beside me. we are at the end of college football's bowl season. as people believe bowl games are ruled with an iron fist by the ncaa, but there is another
player with perhaps an even bigger influence. that would be disney. let's talk about disney. for some, like me, perhaps, the end of the college bowl season could not come fast enough, but let's go on. >> walt disney owns abc and espn channels, and this year 33 out of 35 bowl games will be broadcast, on one of those four networks, including all five of the bcs games. let's take a step back in history. in 2008, his knee had the right to 74% of the games, and then in 2000t killed it -- eight, disney had the right to 74% of the games, and then espn fox killed it, beating sports network out of the water with a $500 million bid. isthe end of the day, this no surprise that espn decided to pay up for these rights because at the end of the day college sports is just huge.
when i reported on the sale of the talent agency ing, it has a big college sports division, and the big selling point there was the fact that it represented so many universities, and that is why it was able to eventually sell itself for a nice premium. let's not forget what i was telling people at the time -- college sports fans are the most compensated out there. they make more money than the average sports fan, about $100,000 per year, and that is why advertisers are so eager. >> i find it incredibly exciting, a huge upset with the sooners of oklahoma over alabama. we have the auburn game coming up here. the end of the auburn/alabama game was the best theater i have seen in five years. espn, i want to buy these properties. my question is, where is fox?
they want to get on this gravy train, don't they? >> exactly. -- he didts channel not have a sports channel back then. what they are going to be doing now, given the fact that they are going into sports so specifically and aggressively, they could become a major competitor in terms of the evaluation of the media rights, which has been skyrocketing for the last couple of years. >> let's not forget that espn has the dough. paid $5.54 per subscriber, 100 million subscribers. the translates -- just cable sub fees alone translate to more than $5.5 billion per year. >> o your point -- >> fox sports cannot come close to that. point, disney needs espn
so badly because it drives a major portion of their profit. >> you are shaking his -- you're shaking your head. >> i don't agree. i think espn is an absolute juggernaut that has to get their expense side worked out. rationalizations over the last few months. >> it is a concern for investors, how much they are going to pay at the end of the day. but they can always pass it on to customers like you, who will watch these games. >> i just look at the stock prices. i think it is a genius property. >> how much are you willing to pay to watch the bowl games? >> i don't watch that much, but a lot of people do. >> up 53% last year, 33% the year before. manufactured is a tension within sports. they are dominant and will compete against fox and do what ever it takes to keep those properties. >> this is a great segue to our
india posco prime minister, man -- india's, india prime minister stepping down. apartment sales in the fourth quarter, sales, condos and co-ops, rose 27%. lack of inventory drove prices. up to a record $1.3 million. >> finally, the big move, up 14%. let's get to morning must read on a snowy morning. cristina alesci, -- >> this is richard waters writing about silicon valley and the fact that not only do they sometimes create doubles, but they may live in -- create bubbles, but they may live in a bubble. "insularity has its price.
it often leads to an too, approachme, in which genuine innovation can take a backseat. it creates a tone deaf society in which wider social and economic issues can feel distant." those that have not benefited from that success, against the broader contact and backdrop of the income gap. >> the heart of it is they are playing by a different playbook. heymann has -- nick experience. do they play by a different textbook than emerson electric or that ge plays by? >> i think they're pretty different. i just read the book on twitter. that was a pretty fascinating rumble and tumble series of holdups. >> do they represent shareholders in the same way as industrial america, or are
shareholders secondary to their own selfish interest? >> they have a different way of going about achieving as a business. >> is there a way to be on board and make profits? >> i think so, but it is all geared around the original controlling entities that own a majority equity. on social media. a lot more later today. coming up, nick heymann on general electric. ♪
58th street. the camaro is still there. we are waiting for the ash for the next move out. a yellowntly drove camaro. >> what was that like? >> it was not that fast. i wanted to drive it in texas, and it was not that fast. camaro is what we will focus on, all of our attention, through the morning. they are on 58th street, i believe that is, here in new york. data check right now -- stocks, bonds, currencies, commodities. 10-year yield, 3%. of 1231.ar, weaker off that is a data check here on a snowy day. --and the gainers and losers
twitter up six percent -- twitter up 6% yesterday. i don't know why he is so optimistic, but he cites -- >> on bloomberg surveillance later this morning. >> on the losing side, linkedin, down 4% yesterday, after citigroup highlighted near-term caution. it sees a limit on the key scenario sales, and i don't know, i feel linkedin has more legitimacy right now than twitter does. i think there is a lot of euphoria. --looks like ebay and google totally different business plans. got its own character, something to watch in 2014. full disclosure, on their influencers panel, i guess they have -- >> to their point, they have
various revenue streams, where is twitter only has one. has the subscription revenue. >> the general electric company are up 290% off the bottom of 2009. it was quite a bottom. jeffrey him else faced the challenge of restructuring ge capital, at the same time -- immelthim else -- faced the challenge of restructuring ge capital. nicholas heymann and william ge fromllow schenectady to shanghai. new is to set up this big reduction in sg na to allow them to overcome the dilution, which was even greater than when they exited nbc. as they set up to exit the north american super finance business. >> with a baseball analogy --
what inning are we in as mr. him immelt and keith sharon tried to stay out from under the debacle? >> there is a lot of heavy lifting to be done here. >> it is a really complicated transaction because they have to do it in a tax efficient way and it is not easy to pull off. i have a question for you on what the company is saying about organic growth projections atween numeral four percent 7%. that is a lot more than industrial companies out there. why are they so optimistic? >> they have been up 17% in emerging markets over the last four years. infrastructure is an emerging market game, so they have a good backlog. i think that they put a lot of money into a lot of r&d. r&d starts to come down a little bit as a percentage of sales, terms oferationally in
the product and in terms of the footprint, they are very well positioned. now it is about the cost side, taking the cost down to be able to better facilitate exiting 22%, 23% ofs earnings in 2013. >> what does ge do so well outside north america that we don't see? the things that allow it to build such a heavy backlog? >> the company works hard to provide and link critical infrastructure, so when they are in africa, where they have been working to build a strong base, they may target a 20 -- a $20 billion to $25 billion revenue. it should be over $5 billion here in 2013. they are working to get the angle low order, which was -- the angola order, which was a
huge win. move toon was able to 12 hours of power a week to suddenly 12 hours of power a day. then the neighboring one has to offer something similar, and ge is there -- >> why do governments like ge? works at the government level for a long time. that is a big advantage to set up the critical infrastructure, whether it is water, power, distribution of power, generation of oil and gas. where are their resources coming from? mining now. just moving through the backdoor any meaningful way in the mining sector. americans think of ge as light bulbs in schenectady, and they are a lot more than that. fortresshe number one they have built? >> this sounds crazy to say, that the number one misperception is that they are just not possible enough to do
ith the changing -- >> you mentioned sg na and bringing that -- organic revenue, given were nominal ge i jumbo -- nominal gdp is, would say that they have delivered it and you can see it in the share price. >> yes, the percentage is good. 2014, 2%, 4% meaningful growth. >> what practice do they do that other companies do not do? i attended their columbus soirée with ge capital, but what is the management distinction of ge versus 3m or jpmorgan or morgan stanley? >> i think 3m is probably the most innovative company that we follow. and ge realized it could not scrimp on r&d.
iny put a lot of money back in the last decade. >> i talked to jeff and he has some optimism for 2014. this after celebrating new year's eve with the possible the u.s. growth will remain anemic and most advanced economies and emerging-market fragility. including china's uncertain efforts at rebalancing could become a drag on growth. nouriel roubini reaffirms seven percent china. do you reaffirm at least a for the likes of ge? >> one of the things that has happened, qe has hurt the growth of emerging markets, and emerging markets saw the currencies escalate and their exports fell and they had to go internal to try to fund their growth. that has also increased inflation, and now they have to
raise interest rates in different emerging markets. >> but it is good for jeff immelt. >> it is, but -- >> you are optimistic on growth and ge's forecast for growth. but are they optimistic because they have to be because they are losing earnings from the finance division soon, or are they optimistic fundamentally because they are going to grow? they will lose a lot of earnings out of that. >> big earnings, yeah. i think they are optimistic fundamentally because they are in a position, they are in place. the next big plays is africa. the last big place was south america. , it has been and continues to be china. i think they are well enough positioned -- they are not counting on india. india has a lot of potential, but it is the biggest black hole
i look at every day around the world. >> thank you so much. erik? >> you think the consumer electronics show is so 2000? >> i do. >> well, think again. the conversation is coming later. you are watching bloomberg "surveillance." don't forget about apple tv. you can watch all our interviews live or on-demand. ♪
>> good morning, everyone. bloomberg "surveillance." we will get to the weather, but with now top headlines erik schatzker. >> secretary of state john kerry back in the middle east. he met with israeli prime minister benjamin netanyahu, trying to work out a deal with israel and the palestinians. points -- they have not been resolved yet. suingd state workers are in illinois over reduce pension benefits. limiting cost of living increases and retirement age for some workers. in college football -- what you were alluding to earlier, tom --
oklahoma tops alabama 44-31. those are your top headlines. >> and michigan state beating stanford -- it has been fun. michigan state has green uniforms. >> that is about all the nuance you have on that. >> that's it. it is 11 degrees. hour,nd is 21 miles per below zero.l is -8 logan airport was closed last night in boston, so a major economic impact from the storm. it is not over yet. i am tracking snow moving over nassau county on long island and one to two inches per hour. you see that area of green -- that is really heavy snow. if you are up early this morning
and thought the storm ended last night, it's not over yet. >> can you say it is a cold winter? can you extrapolate this from january into february? >> it is definitely below normal. is -15 degrees, and we are seeing negative five to -10 wind chills. montclair up there -- it is cold. >> i will tell you cold. >> you are starting to sound like an old father. "when i was young, i walked to school --" >> in new listener, ontario, the is -44.n the border, it put that in your pipe and smoke it. >> -15 or -10, anything like is when you have danger because within 15 minutes, any exposure to the skin can get frostbite. >> i want to talk about
something basic like shoveling the sidewalk. someone older -- you have written about this in your books -- when do you say enough is enough, don't go out? >> if you have a health condition -- i actually did research on that. most of the injuries that occur with men over 40 that have another medical -- >> are you looking at me? >> no. they are hired. on your recommendation. >> i can shove her snow. we should go out and do a shovel-off. those are brand-new. you have neville shoveled -- you have never shoveled in them, ok? is reallye snow heavy, it is not so easy to do it. ?> when does it start yo
>> i think by noon. watching in the united kingdom. coming up, we will look at currencies. in 2014 we will look at the success of mario draghi. one of our favorite guests will join us. we talk about the view forward. there is the dollar. "his is bloomberg "surveillance on apple tv, bloomberg television, and radio. look for our digital media, and all of our interviews, including with nick heymann. good morning. the camaro, still stuck. ♪
good morning, everyone. bloomberg "surveillance." christina -- cristina alesci and erik schatzker with me. >> the owners of genesis sedans say they will be able to use google glass for pre-drive operations. hyundai emphasizes google glass is not for use when you are actually driving behind the wheel.
consolidation in the computer security industry. has acquired mandiant. networksct computer against hackers. t uses the-- mandian the building outside shanghai, they believe is used to spy on american networks. fitness apps architected to be one of the big stars at the consumer electronics show to start x week. where else? --using on digital health that his company news. >> bloomberg west with a lot of coverage. nick heyman with us. william blair. cs's did you go to? >> i have been to four. how sprawling --
>> how sprawling is sprawling? >> it is about three times bigger. >> what has changed? >> it is about how technology has filtered into all parameters of our lives as opposed to just tangible barks is -- boxes and .martphones > . do they save on the income statement? >> adt is about promoting home management systems, and that is a big growth area. definitely growing in terms of importance. >> very good. let's switch gears. you remember from 2013 there was an ugly saturday. cyprus -- it was part of the financial crisis of 2013. around the world, societe provided much
perspective. as weg us from london consider the cypruses to come. can you say all clear for europe to quote a financial crisis that began in 2007? >> no, not quite. the issue is going to stay around. but it will take longer to play out. the issues in europe now? the lack of credit growth and the fact that that levels are extremely high across europe. much later on that subject. back andoing to come bite us, but not this year. >> when you look at europe and europe, whendp in do they get out of recession? are they out now with the stock market way ahead? are they recession-clear? clear inre recession
that the numbers are allowed to be positive. let's call it something like one percent this year. it is not going to feel like growth in any recognizable form. it is stagnation for all intents and purposes with consumer price inflation. we will call it non-recession but we will not call it growth. t, to thet matter, ki euro-dollar, or the overall pace of growth in the euro area or the performance of individual countries like germany or france? >> well, the performance of individual countries matters, of the japanification euro, the fact that the current c is so strong despite the economy being so weak is a of the shrinking
balance sheet, the fact that investors are no longer fleeing europe. if anything, they are coming in and buying individual equity markets that have lagged. for the currency, that has been the story. for europe, politically it is a disaster. >> in the foreign exchange area, what you and i have seen -- i know you took eight weeks off at the end of the year -- or when you look at turkey, when you look at western china, when you look at the challenges in russia around the sochi olympics, how correlated are the foreign indonesia,ents -- the brazil situation -- is this a soap opera, or is there a real message and theme here? >> there is a message and that the enormous amount of money that went into emerging markets currencies over the last few of dollars byout zero interest rates by the low leisure will -- by the low level of treasury yields rather than being pulled in.
a very good piece on this was written. i am not in love with these asset markets, i am just out of love with not getting any money in treasury. higher treasury yields sucks that money back out. anybody exposes any flaws these countries have. >> there was our forex report this morning. kit juckes, i know that is what he is focused on. with flows inore the foreign exchange market. much foreign how exchange is reporting for the ge's of the world? of companies care a lot. at ge, because of all their operations around the world, they manage probably more than anyone else to never speak about for shortfall or windfall in their results. what is your theme for
industrial america this year? are they going to create jobs for america? >> we are seeing some in sourcing back to the u.s., and a lot of it revolves around petrochemical refining, and the surge of natural gas. >> we have two rip up the .cript, nick heymann he knows a snow bank when he sees it. let's go to the analysis of the blizzard. let's catch up with the in aillance camaro, stuck snow drift. how do you shovel out a back tire of the camaro? ?hat is the nick heymann method >> i don't know. i have not driven a back wheel car in years. you expect to get it out in the morning? , on. thehat you do is get out floor mats and put them in front of the rear wheel tire.
gripped by a true blizzard with high wind and snow. the temperature of late class it is 13 belowe placid zero. ,or apple -- david kirkpatrick apple cost average at $553 per share. and we love -- would you please stay? stay! benefits to keep jobs. good morning, everyone. we are live from a snowbound headquarters in new york. it is friday, january 3. i am tom keane -- keene. joining me, erik schatzker and cristina alesci, our guest hosts for the hour. hour, guest host for the it would kirkpatrick is here with us this morning. he appreciate his snowbound attendance. you were brave. you are here. brief us right now.
>> we have our eyes on the snow overnight, causing major problems with money for anybody trying to get anywhere, including thousands of flights. >> jfk closed. >> jeff k closed when yesterday and today. major highways shut down. down.i.e. is shut we will see if that opens on the economic front. get isn numbers. car sales figures, and at the end of the day, we get the aggregate number from the government. we have to note that ben bernanke is speaking at 2:30 today from philadelphia, and they expect about four inches there. >> rob carolyn will be giving you perspective worldwide. this affects you worldwide with a lot of airports. erik schatzker whether the
blizzard as only a canadian can. boeing determines the bulk of its new 777x jetliner. a contract extension is being voted on with the union in washington state. major components like the body and possibly the wings would be made in the seattle area. 22 other states have offered incentives for boeing to relocate production. a federal appeals court will fast-track bp's request -- a the oilurt judge -- company says it is already paying out more than $9 billion. facebook is being sued over allegations it intercepts user'' private messages and then shares the data with advertisers. as co-facebook users filed the suit in california. the suit claims facebook scans the messages and up links them to other websites.
this is a perfect topic on which to bring in our guest host. >> is there married here? is this ambulance chasers going after mark zuckerberg? >> my guess is that it would be. it does not sound so shocking that they should watch the links that you put in an e-mail message because they look at everything you do in facebook. >> but then what do they give to advertisers? aggregated information. i don't see anything claiming that they are giving an outsider something that is about an individual. facebook targets people by groups. theou link to a website, to "surveillance" videos or whatever, maybe facebook could get 100,000 people who have watched "surveillance." >> do you consider this a
nuisance lawsuits? >> more or less, it sounds like it to me. the biggest get targeted, and they are the biggest, most prominent social company, and it is easy to find money there. they have settled quite a few lawsuits against them in the past few years that i consider without merit. >> what were they, the winkle? >> classic case in point, yes. >> david kirkpatrick with us. we will turn our attention to washington, describing the eighth district -- reston, alexander, arlington -- democrat james moran represents your federal workers in 2013 and this year. nothing has changed. america hates washington, each means they hate commerce memorandum's constituents. he joins us this morning from
washington. >> that is a hell of an introduction. >> well, it is. you to respond as a representative for our federal workers to the rest of america ,hat thinks they are lazy bureaucratic good for nothings. what do they really do, congressman? >> you know, edward snowden found out that america is the worst country to be a citizen of except for all the alternatives. the fact is when you go around the country, you begin to realize that we have the most efficient, most effective, least corruptible federal bureaucracy of any major country in the world. we are not perfect, and most federal employees, the vast majority, work hard every day. they are underpaid compared to what they could be getting in the private sector, and you really have to look at who we are as a country, what we have become since world war ii.
we have the shortest economy, the mightiest military, and frankly, we allow the private sector to fulfill its potential to a greater extent than any other large country in the world. >> you sound like a democrat. i like your attitude. you sound like a democrat from massachusetts, which is where you actually are. when you look at the back and forth in washington, how much are you going to need to push back against conservative republicans this year? is the battle really going to move to the senate, or is it still in your house? >> well, the house is the problem, no question about it, and we are going to have to push back to a greater degree than we have ever had to in the past because we have such a large number of members of the house who came into the government with the intent of reducing it, eliminating it, destroying it
really. it is like having a board of directors whose intent is to make the company go bankrupt, to take away the resources and personnel and money that it needs to be able to fulfill its mission. we are fighting against people who are clearly antigovernment, who are ideologues. we have never had as many ideologues in the congress as we have today, and that is really the problem. that is why we have such difficult times finding bipartisan consensus. congressman, the house has 12 days to convert the bipartisan thoughhe'll thomas small it is, into anonymous spending bill. billong will it take the to be filed, and how soon will the house vote on it? >> i think we will vote on it very soon. we will be getting back next week, and i fully expect that we the be able to pass most of
appropriation bills by january 15. there are some that are probably too problematic. the labor health and human services appropriations bill, the health and education programs are in that. that is probably too big a bridge to cross. so interior, if they insist on average -- adding on these legislative riders that preclude the epa from doing its mission, etc., that may be difficult and foreign operations may be difficult. most of them will pass -- homeland, defense, veterans -- that all will pass. >> you come out of boston politics, and when you move down to washington, alexandra, all that, where are the ted kennedys for today? where is the leadership in washington that you and i remember from another time? >> that is a difficult question. i do think that nancy pelosi,
steny hoyer, they believe -- >> give me a republican. help me with a republican that you have your eye on that can benefit here? it is very, frankly, difficult today. somebody like tom cole is someone i have great respect for. he is a terrific guy, a very close friend. there are some others, but the problem is they are few and far between, and that is why i have that kind of difficulty. republicans are afraid of being termed as moderates and being challenged in a primary, and int is why many of them act ways that are not consistent with their conscience or their good judgment. >> we thank you so much for coming on with some straight talk. thank you so much, from the eighth district in virginia. , that was fabulous. he was not on talking points. it was great.
i was just busting his chops. a democrat out of boston ever that has set a positive thing about a republican. absolutely great. david kirkpatrick, it is another world, isn't it? washington is removed. >> i agree. newe was a cartoon once -- yorkers just do not care about washington, and i am a classic new yorker. technology does increasingly care about washington, and snowden has helped that focus. >> there is a storm out there. good morning in boston and new york. all of you worldwide -- erik schatzker, cristina alesci -- tom keene. the camaro has not moved. ♪
what does it mean for microsoft and for that i wish i could start up? >> the interesting thing is, ces and theas a pc event home electronics. it has broadened dramatically. it is not getting any less important. if anything, it is probably getting more important, although people are moving out of the central halls and trying to take it vantage of the gathering without paying money to the organizers. >> how important are the products -- they are talking out themsung bringing new galaxy. >> it is important. we think of the world as being a software-centric world, but more and more creative devices are being -- are emerging to take advantage of the cloud of the software possibilities. speaker -- what does she want out of ces and
what does she want out of the industry to jumpstart yahoo!. >> i think yahoo! is continuing to try to get its feet, but i she has done a pretty good job. respect. more she has gotten a lot more respect than the company had before she arrived. i think also yahoo!, everybody wants to find a way to tap into these new devices like my fit bit that i am wearing. everyone wants to find the nexus between software and hardware. ?is the sxsw crew different by people populated selling and buying. , distributors, etc..
sxsw is more the geek fest. youngerlike coders and crazy technology freaks. and there is some overlap. >> david kirkpatrick with us for the hour. the new "business week." no surprise after a difficult week in social -- in southern russia. the sochi games, the topic of this year's bloomberg businessweek. ♪
back in the middle east, meeting with israeli prime minister in benjamin netanyahu, trying to work out a deal with israel and the palestinians. he will also meet with mock mood of boston. -- with mahmoud abbas. state workers in illinois are suing over plans to reduce pension benefits will stop last month illinois legislature approved a bill designed to fix the nations would increase the cost of living benefits for some workers. spent time saying that illinois or chicago is not detroit. i don't have an opinion on that, but there's a real difference there. -- peaks to >> the illinois legislation needs to find a way to fix this. that's all they have a plan, they do have a plan.
it should not come as a surprise to anybody. their retirees themselves, potential retirees, have some issues. >> what have we got this morning? to interestoing you, i promise. we are talking about the most valuable robbery on television, property onou book television -- the most valuable property on television, espn. espn also receives multiple tax breaks from its home state of connecticut, which is right -- which is why, i suppose, that is the obvious question. the ceo of the connecticut film center, his company organizes tax breaks for the film and tv industry. kevin, "the new york times" ran the numbers, calculate espn has over the course of 12 years received $260 million in tax breaks and credits. the $260 million
is a program you are familiar with. why does espn get this money? >> i think in connecticut that has been a recognition that there are certain industries that we are very strong with, particularly in the last three or four years. legislature has seen television sports as an area where we can be dominant. espn has been a great employer in connecticut over many years, and they pay a tremendous amount of taxes. the employees pay a lot of taxes. there our property taxes, and to stimulate the economy in connecticut.. kevin, with your experience in doing this, nbc sports in stamford as well, i think of the x-files in vancouver, toronto over the years, all of these ideas of doing movies somewhere. can you say it is cash positive
?or a state for jobs >> with any incentive program, you have to look at the individual municipality and say does this industry make sense for the state. that is where connecticut has been so good, saying we are great at insurance, television and digital media, we are great at i/o tech. let's put dollars there and choose winners and say we are going to be dominant in these industries. in terms of entertainment, tax credits, in certain states where there is a predisposition for a permanent industry, it makes a great deal of sense. new york city, absolutely. connecticut, absolutely. georgia, who has done very well with their motion picture production, it just makes sense and it returns the dollars to the state and much more. it also stimulates the economy. does -- how do they hold to develop the land
there? >> one of the best ways is to tie it to the jobs that are created. if you do not reach those job goals, you are not going to get that credit. i think it is important that we hold companies accountable, and that we keep on looking at the programs and saying does this program makes sense for us and is this incentive returning what we need it to return to be successful. >> kevin, a lot of people can understand the logic in getting an industry up and running or getting a production up and running, but espn has 4000 people in connecticut. andt there enough inertia an installed base that espn no longer needs a helping hand from connecticut taxpayers? >> it is not so much about what espn needs or doesn't need, it is about what the state needs.
the state needs than to keep growing because when they grow they are creating new jobs. they committed to a $200 million facility as a result of the incentives that the governor gave. they could have opened a facility in los angeles or georgia just as easily. keeping in connecticut, what did it do for us? it attracted nbc sports network. nbc sports network is building a major presence in stamford. we have wwe there. other networks are looking at the state. it is working to create that industry. >> kevin segalla of connecticut film center, slopeside in vermont. david kirkpatrick is with us. the facebook effect. this speaks right to your area and the others in silicon valley - london, new york -- >> we have seen the value of a concentrated industry. thatss connecticut can do
>> that is a salt trick on the back tire. does that work? >> no. >> we thank people for braving the wind and the rain. -- own "surveillance" saga the yellow camaro, stuck. bonnie schneider is with us here at bloomberg "surveillance." schatzker, cristina alesci, and david kirkpatrick joining us as well. jfk, the airport is open, so you can walk around inside, but you will not go anywhere. they are reporting zero visibility. butboston airport opened, there are no flights. >> the sun comes up, things get better, they get a lot better this afternoon. between now and then, what is your counsel for people watching? >> be patient. keep watching. >> watch bloomberg "surveillance
"? >> it is fueled up and -- >> and you can shovel it out with your boots. >> all kidding aside, we mentioned this earlier -- injuries from shoveling -- now is when you go out. this is your wheelhouse, your expertise. >> i wrote about it in my book, -- one of theer" injuries is for men over 40 shoveling snow. weathera graphic of the injuries that are common. typically we see most injuries occurring with motor vehicle accident or being caught outside off guard. most casualties are male over 40. >> so men over 40 should just stay home today. >> sorry, cannot shovel the snow.
take it slow. don't over exert yourself. we underestimate how heavy this notice. >> we should turn this into a counseling for thompson say stay home segment. -- for tom to stay home segment. young, we had a lot of snowstorms every year. there is so much hullabaloo about this one. is it really that bad compared to what we used to have regularly? >> yes, it has been bad. there have been many bad snowstorms. each one is bad because each one can cause what we see right now -- lots of accidents. >> or we are not used to it. new york used to get a lot more snow than it does today. >> yes and no. there have been historic snowstorms recently, and this one isn't that what with dangerous wind chills. maybe we are hearing about it now because we are tweeting it and getting the word out more. what windchill number is
dangerous? >> -15. that is what we are seeing in white plains, new york, right now. wind chill advisories -- you can see some of the windchill is that we have. within 15 minutes, any area of exposed skin can get frostbite. it does not matter if you are a seasoned snow person or not. you can still get frostbite because you're still human. k, the snowbird. >> that would mean i spent most of my time in florida. >> full disclosure -- when we go to. close, i said inside -- when vos, i sitoa inside. schatzker is one of the few that goes skiing. off the runs to tourists, which is why it is a great opportunity. >> i hope you go skiing this
year for me. >> you might have to join me, tom. we have a lot to talk about and we will continue to bring you updates on the weather. david, how is new york tech doing right now? i guess bloomberg gets some credit for this. when i say bloomberg on bloomberg, i mean in terms of new york, he was the mayor, did a great job. he encouraged investments and entrepreneurship. he gave a lot of real estate incentives to start up. i think the city is doing great. i am very optimistic. is theael bloomberg principal owner of blue bird llp. -- of bloomberg llp. >> are we not allowed to talk about it? >> when we talk about erik schatzker, we have to disclose that he roots for the toronto
maple leafs. stocks, bonds, currencies commodities -- the euro, 137, down 136.53. crude is lighter -- down 1.3653. good morning, everyone. this is bloomberg "surveillance ." we are on bloomberg television, bloomberg radio. all of our digital efforts to bring you the best and smartest of our interviews. look for that on apple tv and bloomberg.com. schatzker,is erik cristina alesci, scarlet fu. she will return, i hope, on monday. >> i want to talk about bowling. this is a story we -- i want to talk about bowling -- boeing. it's union, specifically the machinist union, will vote today on their future in any respects, whether boeing builds the 777x
in the seattle area or if it succumbs to the temptation of moving production into other states. this is really a clash between the new way of doing business and the old way of doing business. union is being asked to give up traditional benefits in exchange for guarantees that the production of the fuselage and 777xings possibly of the take place in the puget sound area. >> labor is upset. they want to make more money. labor is upset because boeing is doing a $10 billion buyback. >> for free cash flow. david kirkpatrick? >> it is amazing that 20 states have offered the money. who wouldn't want the jobs involved in the building of the 777? we are not talking about it problem plagued 787.
we are talking about the mainstay wide-body jet of boeing. >> the only thing about that kind of thing is monitor manufacturing plants do not use as many people. justifying in terms of jobs, it may not be as easy, but robots will do a lot of that work. justt only robots, but it takes fewer people. to mr. schatzker's point, that makes it ever more important to employ what we have got, whether it is in the carolinas or washington state. that trend is not going away. >> we want more manufacturing in the u.s., but you can have more investment with now -- without a lot more jobs. what would facebook be like with a unionized workforce? >> impossible to imagine. and i am a big opponent of unions and used to be a union guy myself, but that kind of personality -- life load of that company are programmers.
they are such free spirits, they peoplever b union -- they will never be union people. >> it did offer incentives for stayill that for people to in the city. states and cities will be fighting for big companies. >> tech companies are going to be thrilled to get incentives. they try to get them all the time. >> within this challenge -- and i guess i will call it the manufacturing renaissance -- let me give you an open question that you are eminently qualified to answer. what is our tech renaissance this year? what is the tech renaissance? >> this quantified self movement, i think it is animatic of the things that are happening with computation going everywhere, including on our bodies, and then you have the internet, where the chip in your microphone and
in my coffee cup -- all these things are really happening. i think this will be a year where we see competition spread more widely around society and we get more centralized coordination of life. google is in the forefront of that with the self driving car and other things. >> i want to tie it into the old as well. microphone -- the guy that made this is the guy who helped produce some of the ray charles electronics way back. it has great modern technology. that your special microphone that you brought in? >> no, i am honored to use it, and we paid for it, folks. >> i would not be surprised if there was a chip in their bank very soon. -- in there very soon. but can you control it from your pocket or your wrist? that will happen.
in boston, across the northeast, the continuing "surveillance" coverage of tom in the yellow camaro. out early inured the morning. this important iphone video, using modern technology, the david kirkpatrick effect. the profanity has been deleted. here we are moving the camaro. this is on 57th street and 3rd avenue. full disclosure -- after ," ourerg "surveillance entire tv crew will exit out onto the street. sophie, tom,lby, melanie -- all of them will get behind the camaro and push that puppy to freedom. a team effort is necessary. we remember when cars got stuck all the time. everybody pushes out. here, we hope you
stay safe and warm. >> we are going to start with fireeye. they went public. i didn't know that. >> they are. fireeye just acquired a closely held company called mandiant. onhave had the ceo television before many times to talk about computer security because mandiant is a firm that identify the building outside shanghai that it believes the chinese army was using to spy on u.s. computer networks. >> fireeye has not had to 32 employees. it is a merger but they are -- has had 932 employees. it is a merger but they are a small company. >> $159 million roughly in revenue. mandiant,ireeye with to they expect $400 million
$410 million next year. >> it is all about security. >> they don't need a lot of employees either. shares of fiat, it closed a deal, a five-year effort to buy all of chrysler. that was after quite a tussle with one of the unions. the united auto workers union, the health care reit union there -- the health-care union there deal in terms of getting this done and a big deal for fiat because it does need to diversify, given the bloodbath it has had in europe selling cars. we will have to see how it plays out first up -- how it plays out. >> i want to talk about the sell,-- it was cut to sprint, cut to sell at stifel nicolaus. up 81% from the october low, and
>> this is bloomberg "surveillance." i'm erik schatzker. scarlet fu is off today. why is apple brian's pick for 2014? brian, what is the deal? recently went to asia, and i think there is a lot of exciting innovation we will see in calendar 2014. return toave the ups growth. eps declined. they will see -- you will see them enter a new product.
you will see innovations in the iphone, possibly three different sizes. >> i want to jump on the iwatch for a second. galaxy gear is a bust, isn't it? be iwatch be worth it when galaxy gear cannot get into -- >> i think we will see at the show -- >> have you seen an iwatch ? >> nobody has seen it. they are so secretive. the fit that is already cool, and it really is pretty cool. >> did you just say we will see an iwatch? tech will be the thing this year. but apple will make it cool. >> the iwatch, three different that mean wees
should not expect explosive innovation from this company anymore? three different screens? how exciting is that? about four years, apple comes out with a new product category. 4 we believe it will be iwatch. >> i want to go to the international perspective here. the 777 is the going price target. times -- allly 14 the mumbo-jumbo is great, but what you say is this is the year of international for apple. >> i think china is really going to break out this year. china has about 15% of sales. i would not be surprised if it is a quarter of their business. remember, 760 million subscribers. >> what does the apple bloom
crew get long about their international expansion? >> i don't know what you are saying about it. what they have done, it is a domestic story but they have done well overseas. ios in the car initiative. they say that this year they will have a dozen carmakers using ios, their software, in cars, which we will all love because it is so user-friendly and well-designed. -- mercedes, w bmw, gm are all on board. >> are they the only ones with an ecosystem? >> apple has a better ecosystem because they have better technology, but definitely google has a very good and growing software -- >> google plus to me is not an ecosystem. >> one of the themes this year is going to be cash. they are under a tremendous
amount of pressure to return cash to investors. how much will they return? >> carl icahn has been pushing for this $50 billion. it has contracted 60% over the fast five years -- the past five years versus s&p. >> how much cash do they return under carl icahn postpone -- under carl icahn's postal? how much cash is that on $50 billion? is asking $50 billion return but they are pushing back on it. much -- they want to take out $50? that is why we love having you. >> i think what is going to happen is you will see some kind of distribution. >> brian, your price target assumes a multiple. analystwith the average
on the street, that assumes a multiple of 12.6 times. why will people be prepared to pay more for apple? >> is apple an average company? >> we could have been asking the question the past two years. >> i think the fears of them being squeezed out by competitors is over, and the return of cash argument is over because it started down that path. take something like 50 times revenues for twitter. apple is a cheap stock compared to what they are capable of doing. rose is great, but a real company is something that matters, and apple is the most reliable profit generator in tech. great point. if you only grow the free cash flow two percent a year into the future, the stock is worth our price target. >> but that is not very exciting, though. 770 -- from 533 to
>> that is the point i am making. if you use conservative growth, you still get our price target. >> is apple yet a blue chip stock? >> i think it is a blue-chip stock. 40 pert was trading at share -- i want to get you in trouble here -- it is -- is it a down component? >> ultimately -- is it a dow component? be.ltimately it could they have the brand and the recognition. >> you are a trooper. brian white from cantor fitzgerald, right around the corner. he drove through snow banks to get here. my agenda is to: 30 this afternoon, philadelphia and sylvania, ben bernanke, one of his final -- philadelphia, pennsylvania, ben bernanke, one of his final speeches.
about 1000 people in the major ballroom to hear him discuss his janet yellen and stanley fischer presumably take over. a lot of emotion. these are his academic compatriots, all the different universities. you see lots of nervous economists going around trying to get jobs, but you will see the rockstar. he is going to go in their bank. i assume stanley fischer will be there, maybe even janet yellen, all rise after what he has gone through with this crisis. >> of that, surely, there can be no doubt. to radio. we bid you farewell for the weekend. istina, what is on your agenda? >> i will be watching the car results from the auto industry, coming out through the morning. at the end of the day, we will get an aggregate number from the
government. our own reporter matt miller i am sure will be all over this. it has been a banner year for the u.s. carmakers, and they will probably post some pretty strong results -- post some pretty strong results here. obviously we have -- >> they now call it mobile on wheels. >> what car will be the catalyst for auto sales? >> i don't know if it will be a catalyst for auto sales, but it will be very important for the mobileequal system -- ecosystem. >> one of the first things car buyers look at his technology of the car. what is on the screen, how does the ge it -- how does the gps work? was in arst time i tesla, i was blown away. amazing.is the screen is beautiful. >> it is like having a 55-inch tv in your car. boeing, 31,000 machinists in the
washington area, most of them, will be voting today on a proposed contract extension. futureuld determine the of play manufacturing in the seattle area. 777x to otherthe states. the twitterbout question of the day. we put it to you earlier. what sport does not get enough coverage echo -- does not get enough coverage? dodgeball. >> that is totally hipster brooklyn, your part of town. >> sumo wrestling does not get enough coverage. watching how many new yorkers watch -- walked past a car stuck in the snow. i want to thank our guest host, david kirkpatrick. and also brian white of cantor fitzgerald, busy typing away.
betty liu. chrysler sales are coming out at any moment. last year was the strongest in many years. sergio marchionne making a bid. flagship fund for pimco's bill gross was hurt by the fed. a severe storm is making life very icy and snowy on the east coast. in feet of snow have fallen some areas, causing travel issues for many. temperatures are in the single digits. december u.s. vehicle sales on chrysler were up 5.7%, falling short of estimates of the rise of 8.4%. matt miller has more on the numbers. >> i am looking through the