Skip to main content

tv   Market Makers  Bloomberg  October 30, 2014 10:00am-12:01pm EDT

10:00 am
environment going into 2015. active management and multi-asset. >> thank you so much. we will be back on the markets again in 30 minutes. ♪ >> live from bloomberg headquarters in new york, this "market makers."oop >> the luxury retail scene is en fuego. >> a fall classic. why didn't more people watch the amazing world series? you are watching "market makers
10:01 am
." good morning. i'm erik schatzker. >> i'm stephanie ruhle. did you watch the world series? >> i did, but not much. i am part of the problem. morning'sart this show with a bulletin. the top stories in business and finance from around the world. the u.s. economy has not grown this fast and more than a decade. gdp expanded at an annual rate of 3.5% in the third quarter, more than economists had forecast. it grew at a 4.6% rate in the second quarter. combined, the two strongest back to since 2003. household spending slowed down a bit. cook says he is proud to be gay. he has an editorial in a new of bloomberg businessweek.
10:02 am
he writes that he has always tried to maintain a level of privacy. that has held him back from doing something more important. here at bloomberg businessweek -- >> he ultimately decided it is more important for him to step out and represent within the world and say "i'm gay and proud." pick up a copy of bloomberg businessweek or go to the website to read the entire essay by tim cook. apple is now talking about growing the iphone in iran. they met in london with potential iranian distributors. more economic sanctions are still in place. the government has lifted the
10:03 am
ban on consumer to medications technology. mastercard posted third-quarter profits that the estimates. more consumer spending and mastercard has signed a new deals with retailers, including walmart and visa also had a great quarter. it was everything you could have hoped for in game seven of the world series. attom of the ninth, giants 3-2. madison bumgarner on the mound. it's all over. the giants won their third series in five seasons. course, he is the mbp. >> we have another m.v.p. here. >> i wasn't thinking about how
10:04 am
many pitches or any of that. i was just thinking on getting outs. we had some pretty quick ones and they gave me a chance to stay out there. >> he seemed kind of tired. we have another m.v.p. with us. the qe era is officially over. the end of easy money might not be far behind. the fednomists expect to raise rates next year for the first time since 2006. that will have a huge impact on banks bottom line. jimmy dunne, how about notre dame right now? >> absolutely. everything is going well out there. the rankings are not appropriate. how they came to that decision, i do not understand. we have to win the games. we have a great coach. things are going great. >> how are things going for
10:05 am
banks? are banks positioned for an increase? >> absolutely. there is not a bank in the country that says it does not anticipate rates to go higher. this action was the right thing to do. it is a year late. bank --think there is a >> he's talking about the fed. >> they really wanted some elements that were ok. when you look at america, we are in much better shape than europe. the american economy is in decent shape. i think it's also going to take too long for it to be of limited. it will help rising rates and help all the banks. what it's really going to help more than the banks is the m&a business. rates are going to go higher. that is terrific. about time. grow, they are not
10:06 am
going to go higher fast enough. you will have to acquire assets. if you are too small, you will have to sell. >> explained to us what the interest rate environment needs to look like for banks to make more money on the difference between the bonds and loans. the plasma to the bank is the net interest margin. it's a much bigger weapon to control your deposit course than razor asset pricing. -- raise your asset pricing. himn moynihan -- take as an example. they are not going lower. that is a bigger problem. >> if you were to draw it on a
10:07 am
chart, they should be negative. >> absolutely. that's not going to happen. that is the real inherent problem. what we need is a sustained period of higher interest rate. they are too low and everybody knows they are too low. it will take a wild to get there. that will take time and that is not as good of news to the banks . it's going to be a bit longer. saying july, the beginning of next year. --hink at least >> if all they do is to five basis points in july and another in the third quarter -- >> if you were writing everything on the rising rate environment, it will take much longer than you thought. company, it'sg going to take too long. you will have to buy some
10:08 am
people. if you are smaller company, you will not get that benefit and you have to find the right currency to trade into. great company, great credit, young management team. they can look at the horizon and say is going to be -- we are better off joining force with a bigger company with a good currency and in a year when we could have gone public, we will be that much further ahead. they did a great job. look at samer o'neill and say it's time for us to partner with a bigger company? >> i think about what we should be doing all the time. hopefully. >> hopefully. >> the thing about us is, we don't really need capital to do what we do. if it was something we are not doing that i wish we could be doing if i had a bigger partner, i would think that.
10:09 am
we sort of mark ourselves in the market every year. we don't have people that are grossly underpaid. we don't have a real need to go public or a need to do something with someone else to bail us out . would we be a good asset to a bigger company? oh, yeah. mind? have one in things are starting to happen. there still is not a whole lot of consolidation in financial services. >> for the secondary and tertiary, there is. >> enough to do more than pay the bills? >> hopefully we can buy a few titles. we are going to do very well when our clients do well. if you look at the snl this 25% ine are up about
10:10 am
deals this year, generally. with today's announcement, that puts us at 48 deals for this year. we did 47 last year. >> with a couple months to go. is it the massive regulatory cost they face? >> for the longest time -- i've been doing this too long. aboutrs ago, i would talk size being important. it really wasn't. i did not understand it so much then. it is important now an important mostly because of the regulatory side. banks,look at the 7400 6000 are $1 billion or less. with all this too big to fail having a much higher burden on the smaller companies.
10:11 am
you can go on a long time and do whatever you want to do, but if you really want to show a double-digit return to her shareholders, whoever they may be, it will be difficult to do that the smaller you are. or 5ave to be at 2 billion billion. there are 400 banks between 1,000,000-2,000,000,000. >> how many should there be? if i had my way, about four. fragmented -- do we need 5000 banks? >> need is not the question. >> what would make more sense to the industry? >> small banks don't hurt the economy. >> you have larger institutions -- it's precisely for the reason you make the argument, to save costs heard if there is less
10:12 am
cost built into the industry, the mooney saved is finding its way to the economy in another way. or they have fat profit margins and shareholders are very happy. >> the smaller banks, if they are shareholder conscious, private or not, they will be driven to merge with other people. in the end, they can exist for a long time in service the economy -- it's an issue of who are they running it for. >> are you surprised we have not seen more bank consolidation in europe? we were looking at the stress test and the number of institutions in europe, their economy is not tugging along. they are sitting on a pile of garbage. >> europe -- we interface with europe to sell them a lot of companies. they have not done much of that
10:13 am
since 2006. i don't anticipate them to be back in the near future. the thing that concerns me about that, 10% failed this year. the thing i'm uncomfortable with is i don't think people really know what really is going on there. ecb and the european banking authority look at 119,000 bar worse and employed -- borrowers and employed -- after conducting that exercise, somebody who is as well informed as you are still does not have confidence in the level of transparency at the european banking industry. >> it doesn't mean i'm right. i don't have any confidence. i think europe is not as far along as people thought it was six months ago. you're not just mark, but
10:14 am
humble too. -- you're not just smart, but humble, too. >> you think it's been a wild month for investors? try running an exchange. the executive chairman will be with us in about 15 minutes. ♪
10:15 am
10:16 am
10:17 am
>> it's "market makers" here on bloomberg television. we've got the ceo of sandler o'neill and partners. talking about m&a. what is your dream of merger? if you can take to firms that exit lewdly blonde together -- absolutely belong together. >> this is getting so nerdy. >> i can't give a name.
10:18 am
is, a threeof it -- ar is the recognition dream of merger is a recognition that you need a better vehicle to get to the next place. the idea that people are starting to recognize, you are taking stock in another company, you are not selling anything. you are buying that company. you are taking your assets which you built and changing it into a different vehicle. seas say you were out to and they are fairly called. -- they are fairly calm. you want to be in a good vessel because the world can change. mergers are win one plus one can equal for and you can take a well run company and
10:19 am
broaderinto a bigger, diversified company and that stock goes up 30% when the index is only up 15%. it is happening more now. the hardest thing in the world is when you go to board meetings, they will all tell you , we understand, we understand. and then they say, but pay me a big premium this one time. that is the issue. you are taking cash, you are selling your company and you are either from the industry standpoint or other opportunities come this is your best opportunity. the dream mergers when you put to two compass together -- >> two weeks ago, sitting in these seats, it felt like we were falling off a cliff crying
10:20 am
and screaming back to 2008. are we really back from the brink of disaster? what was that? >> sandler has a different perspective on top waters. through 2006 and 2007 and 2008. that was something to go through. there were moments you thought it was going off a cliff. been through 9/11, so we had a different psyche. the market was too calm for too long. -- theblem with that volatility helped a lot of the middlemen like us. activity occurs. was, i don't know if investors really did that well. whipped andguys got that real calm, a lot of
10:21 am
volatility and real calm again is not in their best interest. >> isn't that the moment when real investors shine? our ceowe try to tell is you want to run the company for the investors being there tomorrow, not just today. if that happens, that is terrific. delineate -- i think longer-term, real investors will do fine. month inavor of the silicon valley is to best teachers. -- is divestitures. is that going to come to finance? >> i think the larger companies are not going to do a lot more acquisitions. they are going to continue to rationalize their balance sheets. if they have pieces of business that can't hit double-digit
10:22 am
return, you'll start to see that being spent out. it makes a lot of sense. i love donohoe and carl icahn. i think banks should rationalize their balance sheets. >> so great to have you. >> when they rationalize it, they should work with jimmy. >> absolutely. i'm here for you. >> thank you very much. >> the world series was great, if you were watching it. very few people were. woes.ll's ratings ♪
10:23 am
10:24 am
10:25 am
10:26 am
>> we are approaching 26 passed the art periods time for i to take you on the markets. -- visa --shares are we wanted to show you what's happening with the dow. the s&p 500 and the nasdaq are down. lisa is having a heck of a day -- visa is having a heck of a intention back of an that it plans to charge some u.s. banks higher processing fees. visa is a $230 stock. the real stock market is down. >> the tao needs to be revisited. ow needs to be revisited. in my opinion.
10:27 am
return, luxury boom and miami getting some retail therapy. that and more when we come back. ♪
10:28 am
10:29 am
10:30 am
>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> good morning once again, folks. >> luxury retailers are descending on miami. the city does not have enough retail space to meet the demand. so developers are breaking ground on at least 20 new retail buildings in the next year. what is driving this luxury boom? i want to bring in craig robins, the head of the company that runs the miami design district, including product, cartier --
10:31 am
da and cartier. your reputation is only getting bigger. what is so special? >> we are doing a beautiful project in the miami design and its ins merging -- merging culture and commerce. restaurants are opening and we are in the process of building the buildings for 120 luxury stores. >> is there a risk that things are getting top-heavy? brazilians come in and buy some much real estate. here we are five years later and i'm looking at apartments listing for $10 million. who is buying all this? >> miami is totally on fire. bubble.ense, it's a inside that bubble, the real major city is emerging. that is what's exciting me. >> do you envision this as being
10:32 am
that growth or are you taking and building this designs district by taking things from elsewhere? situationas a unique in miami that does not exist anywhere else in the united states. it was the most underserved luxury market in the country. there was absolutely no product and there was only one location -- the second or third biggest luxury market in the country. there was only one place to go. we just offered something where there was actual real demand and it is super exciting. they're getting out of the malls and onto the streets and the brands are doing beautiful buildings. in a way, it can change retail in the country. >> why not do it in south beach? beach anded in south love to. it's a very commercialized destination.
10:33 am
for something that could be a regional draw, the design district right over the bridge and central to everything in miami is the perfect place. city should have one really cool, creative laboratory. the design district is clearly that. initially, i partnered with a fund that co-owns the design district. as we started to have made a gp,cess, when approached by gdp we saw as a will opportunity to have another great, strategic partner. what i've learned about partnerships is, they are not easy, so they have to be really strategic. in the case of general growth, we thought one plus one would equal five. >> you don't see the risk of a
10:34 am
housing bubble being that much of a blockade for you? here >> the housing market will go up and down. , miami ispening is becoming a dynamic place to we have interesting institutions and people want to be there. it's a real city and it's a real place to visit. that will continue into the future. we will be impacted by cycles. muchu are plowing investment, millions and millions of dollars into real that is veryisland close to a rising ocean. whether you believe in everything about climate change theory or not, glaciers are melting, oceans are rising in miami has been identified as one of the city's at risk. does that concern you? >> it does come in general. in the case of the design are at the we
10:35 am
highest point in miami and we are off the island, on the mainland. if the water was to really rise, we would end up with waterfront property. >> when you think about what you ,ant miami to be, realistically 10 years from now, are we going to talk about luxury and design hubs? >> i feel it's already happening. miami is the gateway to latin america. it's an exciting, sexy city. it has become recognized as a global place for cultural substance. the difference between miami and new york is miami is a much newer city. being a new city, there are advantages and disadvantages. we don't have the depth that new york has. but we are building great things. there are wonderful institutions popping up in miami. it is taken more and more seriously all the time around the world. >> you are clearly an important
10:36 am
figure in the miami scene. do you get confused for people all the time -- for pitbull all the time? >> all the time. >> thank you so much. great conversation. >> thank you. i will come back. >> for sure. >> coming up, record volume. how did the exchange deal with this month's volatility? ♪
10:37 am
10:38 am
10:39 am
>> the best business to have an financial services? nature is not banking. is not banking. credit cards are hot for sure. stock trading volume may be
10:40 am
anemic, but futures trading is not. that's why shares of the cme timesare trading 25 estimates. terry, great to see you. you know what's on everybody's minds? volatility. 15, cme traded a record 25 million interest rate contracts, way above your average daily volume of 7.2 million. give me youring -- perspective on the outlook for volatility. it was so low for so long. now it has dropped back down again. >> it does not surprise me. when you have a market that is going to extreme highs or extreme lows, it has a big movement one way or another.
10:41 am
when you look at volatility, let's try to look at it as a trade. volatility has been anemic over the last several years. all of a sudden, we start to get spikes and we have a lot of geopolitical events going on that are now making this volatility become more front and center. the government is announcing they are out of the quantitative easing business. it's a whole different ballgame today versus just six months ago. when you can do 39.8 million contracts in one day, that is a ,uge amount of risk management of which 25 million of that was interest-rate futures contracts. important, even though we are not doing 39.8 million every day, we are up in october, our products across all of our asset classes, treating 50% higher
10:42 am
than one year ago. it's a big change of events. >> people on the services side love volatility come in theory. they want you to believe volatility is a good thing. what about short-term volatility? is it a good thing or a bad thing? people andares drives them away from a market they just returned to. you cannot say as either a good thing or a bad thing. it is a reality. it has been around for hundreds of years and it's going to continue to be around for hundreds of years. it's one of those things that scares us off. it comes fast and furious. you never eliminate volatility out of any equation.
10:43 am
it just gets quieter at certain times and busier and others. >> why on the conference call did it seem as though there was a fair amount of attention to costs? how much cost can you still take out of the cme? very just did a significant cost reduction, 5% of our workforce. you don't want to get yourself into a situation where you can't take advantage of the opportunities in the marketplace. we have been treading water like a lot of other folks for the last five years and the markets are starting to move right now. do isst thing we want to put ourselves into a situation where we have $22 trillion in our clearing and take that down to a skeleton crew and pose risk to the system or to the company. we can grow from here.
10:44 am
we have put ourselves into a good position and we will be very mindful of costs. we came out today with guidance around 1.3 billion for 2015. >> are you under pressure from investors to focus on cost? because of the extraordinary cost cutting opportunity your principal competitor has at the new york stock exchange. they bought the cash equities business. considered by many to be too fat. and theyorking hard have demonstrated there are some good results to be had. >> there is no question that cost cutting is an important component of every company. aen you are managing quadrillion dollars in risk on an annual basis, you have to be very careful not to go down to a handful of folks. my competition who has a big component of credit default swaps with no offsets against
10:45 am
them need to be mindful of how they will manage that risk. we are sitting with $22 trillion of interest rate swaps which we can offset against our futures portfolio. we are already saving clients $4 billion. you can take cost down to the bare bones and have a race to the bottom, but you better not present more risk to the system. it's not fair. >> terry duffy is the executive chairman and president of the cme group. coming up, the san francisco giants were the big winners last night. americans and care about an exciting world series in seven. ♪
10:46 am
10:47 am
10:48 am
10:49 am
>> the san francisco giants beat the kansas city royals 3-2 in game seven of the world series last night, winning their third championship in five years. san francisco may have come out a winner. the series had been a losing battle for ratings into last night. a battle between two small-market teams. however, game seven turned out to be something of a redemption. matt miller is here with a look at the numbers. walk us through it. >> if you don't do well in game seven of the world series, it's a sign of the apocalypse. you have to do well in terms of ratings in game seven.
10:50 am
do fairly well. they got a 15.2 percent nielsen rating. that is the best they've had since the last game seven of the world series. >> the non-nfl rating. >> exactly. the tide has turned as far as america's favorite pastime. football is everyone's favorite sport to watch. remotewho control the are watching football. hasmajor league baseball shifted its world series schedule this year so as not to compete with too many football teams. played on the traditional wednesday, they would have competed with four different nfl games. they switched to tuesday and only had to compete with sunday and they got blown away on games by midseason nfl
10:51 am
come even though it was a world series game. seven,y not had a game this would have been the lowest world series in history. they've only had about 12.4 million viewers on average. before this, the lowest was 2012. things have been getting worse and worse. the spike down there is because series that year. it's just on a downward spiral. >> what is the game plan? >> they have a new commissioner coming in. there are a few rules that baseball does not adhere to. the batter is not supposed to step out of the box after the pitcher gets set up.
10:52 am
the batter steps out of the box as often as he possibly can and for as long as he can without it being totally annoying because he wants to get more based time. they are able to squeeze more commercials in a game that's well over three hours. in the past, they were only 2.5 hours. they have really stretched it out. >> you wrote a campaign about that. >> yes. football, butfer they prefer to watch soccer. which is insane to me. >> between san francisco and kansas city, do we know who is reading -- >> do you even have to ask that question? what else besides barbecue and the blues does life have to
10:53 am
offer and kansas city? people in san francisco have much more to do. >> they have apps to invent. 38% were watching baseball. the rest were inventing apps. >> they were coding at the time. city% of people in kansas were watching the game. this speaks for emily. -- for mlb. that has come back a bit in this world series. five of the six games were the best rated program for the night in the 18-49 demographic. >> i want you to stick around for this. it has been to five years since michael lewis wrote "liar's poker." michael has a touch. he lets anecdotes and characters do the storytelling.
10:54 am
he is a very different person off of the printed page. opinionated, especially when it comes to wall street. talking tohael lewis charlie rose about the difference between wall street and silicon valley. wall street attract people who are very ambitious but don't know what they're ambitious about. they have something specific they want to do. you have to know about computers -- they tend to come with a clearer set of skills. there is a slightly different crowd that trips that way. does providetill colleges of the best in the country a place to go when they don't know what they want to do with their lives. >> wow. michael lewis. you worked on wall street.
10:55 am
is it just a destination for wayward -- >> you don't think that's the case? i think he is right. >> why? usually just get out of ivy league colleges and want to make a ton of money. capital "n."th a there is a lot of people out there who might not be that impressive. i'm not saying once somebody works on wall street they should -- there are some extra narrowly talented, smart people. it is the banking system that fuels the u.s. economy and has for years and years. spare me the sanctimonious silicon valley bs. it is loathsome and tiring.
10:56 am
let's talk for a minute about -- in addition to being one of the smartest minds in the financial industry, he is going to go down as one of the greatest philanthropists in his generation. what is he? a wall street guy. i'm sorry. you can't say let's have a party for silicon valley and dam wall street. because he's given a large chunk of dollars away -- it's not a black or white. there's a ton of bad people on wall street and bad people in silicon valley. >> i love gross generalizations, though. >> i know you do. i enjoyed being in the middle of this.
10:57 am
i accused michael lewis of being opinionated. >> there are bad guys on wall street. ♪
10:58 am
10:59 am
11:00 am
>> live from bloomberg headquarters in new york, this is "market makers." >> gridlock or compromise? will be next two years like in washington if the republicans grabbed control of the senate. she made frozen red hot. what is next. drink up. we celebrate the birthday of one of the most crucial inventions of the 20th century. single barrel bourbon. good morning once again. i'm erik schatzker. we start this hour with the top
11:01 am
business and finance stories from around the world at this hour. shares of the set are rising the most in three years -- shares of visa are rising the most in three years. low double digits for the current fiscal year. mortgage rates rose slightly this week. two basis points below 4%. the fixed 15 year -- the government's home purchase and is at its lowest level in seven years. apple's ceo is gay and he is proud of it. he wrote an opinion piece in the new issue of bloomberg businessweek. in it, he says he tried to maintain a level of privacy and not call attention to himself but says he has been --
11:02 am
here is bloomberg businessweek editor josh earlier. >> he ultimately decided it is more important for him to step out and represent not only within the business community, but within a world, because apple is a global company and say "i'm gay and proud." of cook's read all essay in the new issue of bloomberg businessweek. the latest entrant in the crowded wearable devices field, microsoft late to the party. the company unveiled an activity tracking wristband. microsoft band is relatively expensive. it works with the company's free health app. it is time to start asking, what happens when the republicans take control of the senate next week?
11:03 am
odds appear to be solidly in their favor. what happens? what would this mean for the final two years of the obama administration? compromiseing about or gridlock? let's ask peter cook. >> there are two options here. you mentioned them both. the prospect for gridlock on steroids or maybe, just maybe the opportunity for the two sides to cut some deals on some important issues, especially issues important to the business community. arepeople i'm talking to now predicting we are looking at gridlock on steroids. so dividedes are right now, conservative republicans are pushing so hard for some big boots on issues -- votes on issues. boats to improve the keystone
11:04 am
votes to repeal obamacare and boats to approve the keystone pipeline. you are definitely going to see the president breakout his veto pen on republican priorities. i don't think he is going to want to change anything regarding his obamacare bill. on some major energy issues come he is not going to want to change anything. we will see what happens. i think you are going to look at trench warfare over the next couple of years. for the nextfare couple of years does not bode well for anyone who wants to see some deals in washington. a lot of it will rest in the hands of potentially new eader mitch mcconnell. there is no question, republicans and democrats don't see eye to eye on any number of issues. are some issues
11:05 am
where there is room for compromise. is the narrow possibility here. the pathway to compromise, having republicans in control might afford opportunities -- business tax reform. an area where both sides have ideas. using offshore profits from u.s. corporations and devoting that to infrastructure. the biggest obstacle has more to do with congressional democrats like harry reid. , immigration. there is a possibility that republican leaders want to get this issue off the table for the 2016 election. they know it's a hurdle for them. >> peter, thank you for the update. the election next week will tell all.
11:06 am
guess what tomorrow is? stephanie's favorite day of the year. halloween. we have been inspired to look for spookiness in the corporate world. i'm talking about zombie companies that look like the walking dead. halloween, but i don't like horror, blood, gore. i just like a little freakiness. >> you can look at our twitter feed. plenty of examples of what's happened in the past. in retail, there are a lot of different examples of these retailers that have stumbled along. are they actually going to eventually die or just keep on going in this way? i have found some specialty retailers. toys 'r' us and claire's.
11:07 am
i talked about another example. another company that at one point when private, took a lot of debt, became public again. you have this cycle where they are struggling to generate enough cash flow in order to pay down that debt and pay the interest on that debt in the meantime. in the case up was arrest, they have a lot of competition. -- in the case of toys 'r' us, they have a lot of competition. amazon and target and walmart. toys 'r' us embark on a strategy of trying to collected more of its babies r us stores. there is some optimism that they are going to come back this holiday season. they also just completed a refinancing.
11:08 am
when you are using your cash just to pay interest on your debt, that is not an ideal scenario. >> do these companies need to hit a home run? >> it depends on your perspective. we have talked about jcpenney and sears. it depends if you are an or someone who likes to shop there. radioshack is the other one we've talked a lot about. they just got a new rescue package from standard general. harry wilson is a turnaround specialist. they have brought him in. he is a former u.s. treasury department official. miller thinks they should change their name to the
11:09 am
drone zone. >> there are a lot of concerns about radioshack. you see what the problems are. double-digit decline quarter after quarter. even this latest rescue from standard general just forestalls the inevitable, perhaps. charte been looking at a for price and yields on toys 'r' us fonts. triple c minus. they are trading at $.76 on the dollar. a 22% yield. looking atyou are any big companies, they looked worse. they just got that refinancing. that did improve the numbers to some extent. >> thank you, julie. >> zombie retailers.
11:10 am
tell thee return, truth. you cannot wait for the sequel. the codirector of "frozen." ♪
11:11 am
11:12 am
11:13 am
>> welcome back. frozen came out of nowhere to become disney's top grossing animated film. its success propelled the writer and codirector to the top of the rings of hollywood and she is featured as part of the new issue of marie claire magazine. jennifer is here with us now along with marie claire editor in chief. how does jennifer make it to the
11:14 am
be the prominent woman on this list? it's a kids movie. >> when we created the new guard , we wanted to redefine power. power is normally about how big your office is or your paycheck. these women are redefining power in terms of how they are getting things done through their networks. to creating content or businesses where no -- jennifer's story and how she changed the story and became the director of the movie puts the bill. >> it was not your first film. nemo, shrek, brave. how have none of them compared to what frozen has done? >> we are still asking ourselves that question. one of the great things about frozen, we love the classics. we were antsy for what we can do fits today's
11:15 am
audiences we took a lot of risks co. saw saw my writing and they in me this way of loving the old but a feisty authenticity approach. going?you keep that feisty authenticity. madeat's what you think frozen what it is, fantastic. if i were john lasseter, i know what i would want more of. make money for all the major studios. is that what they are asking of you? >> chris and i are dreaming up something new.
11:16 am
every week, i get asked a frozen two's wester. 2 question. there into shaking it up and keeping things new. was and whatisney disney wanted. pixar, outside of toy story -- >> the audience now wants to hear some courageous women who were not damsels in distress or princesses waiting to get taken away by prince charming. >> absolutely. thathappened with frozen you changed the characters to become more complex. finding these authentic stories, i think authenticity is resonating with audiences now.
11:17 am
you are seeing that with another group of women on the new guard. >> we sat down with bob iger a few weeks ago. frozen costumes have been crazy since the movie came out. we were not fully prepared to meet that demand. we are definitely prepared this season. thanld 36,000 in less three hours. there were lines outside of disney stores. similar to apple, 36,000 costumes sold in three hours. what gives? and it did not resonate the way frozen has. >> and/or brave. -- i and/or brave. -- i adore brave. i think it paved the way.
11:18 am
-- is story resonates elsa's story resonates with people. superheroe a female with no powers. >> why do you think we have more female content creators? is it the quest for authenticity? seriesave seen in the tv , they have taken over thursday night. you are seeing a real authentic female experience. we are seeing that it's raisin we arethat resonating -- seeing that it's resonating. i think a balance is perfect.
11:19 am
chris and i together could challenge each other and push each other. he might go to a more familiar place. we are like, girls would not do that. we are having a voice in the room. the women in the room are getting more and more vocal. >> can you give us an idea? for the disney live-action version of "wrinkle in time." a feisty, young, early teen girl who sets out to save her dad. i can't say what chris and i -- we are doing a frozen short. we are doing that. olaf costume would not
11:20 am
work with the sexy costume theme. do you have more women to choose from than ever now? >> absolutely. it was like here are those 10 girls again when you started. >> a lot of those great female ceos were in the top of their fields. we all know who they are. we wanted to find the next generation. find out how they are creating what they are doing. new content and new adventures. >> congratulations. i love the movie. can you believe it's the boys who love the movie? congratulations. thank you so much. jennifer lee. >> when we come back, we will
11:21 am
bring you up-to-date on all the latest. ♪
11:22 am
11:23 am
11:24 am
>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. approaching 26 minutes past the hour.
11:25 am
it is time for bloomberg's on the markets. let's show everybody what's happening across the board. the s&p 500 is finally turning green heard nasdaq remains in the red. >> barely. why? it's all because of visa. it's a $235 stock. reporting earnings yesterday that said it expected revenue growth in the current fiscal year to be up in the low double digits. it plans to charge banks more. outlook is improving. there is more currency volatility. it had been the geopolitical events that we have witnessed over the past several months weighing on the amount of card
11:26 am
transaction volume. some of that has abated. , thestercard second-largest u.s. payments network posting third-quarter profit beating analyst estimates. the ceo has signed new credit card deals with some retailers. including walmart. that has caused a huge pop for them this morning. >> it has been a tougher year for those stocks. visa was up 40% three years in a row. even with today's pop, only up 5%. drugexperimental cancer improved survival rates for lung cancer patients. here are the statistics. 5.5 percent of patients who historically have survived over the timeframe studied under this drug became a 41% survival rate.
11:27 am
41% of patients alive after one year. >> a lot more important than a stock don't know. good news. ♪
11:28 am
11:29 am
11:30 am
>> live from bloomberg headquarters in new york, this is "market makers." with erik schatzker and stephanie ruhle. makers."e to "market every day i have to sit next to a canadian and it is freezing. finally we have got to get. >> there is a reason we are dressed like this. marmot, mr. of yankee coleman grills, candle, dozens more. for a look at the strategy
11:31 am
behind this diverse portfolio of products and brands, the ceo is here. >> thanks for having me. >> the question everybody asks ,hen they come to jarden is explain the crazy quilt of brands. lines, yankee candle, how does it all go together? thet is about leveraging channel for the consumer. having relationships with retailers and bringing a sister company to a new marketplace to help them grow their business. >> you are marketing and merchandising experts. >> look at that cute little thing you got. >> stephanie is pouring herself a mason jar. >> is our draft mark system built with inbev. stephanie is using a jar from our home canning business that
11:32 am
we have modified to be a beer mug. makes mason that jars, do they make the canisters that a yankee candle does in? thef you think about all glass we make, lanterns, jars, yankee candle glass, it is about theraging the scale of system. drive gross margins up and creating incremental distribution. >> what do you think the u.s. economy looks like right now? we sit here with experts. you are talking about price points that affect different types. >> he has as good a view of the consumer as anyone. is pretty healthy. 6.4% organic growth for the quarter. the consumer is pretty healthy. they are doing much better domestically than internationally. europe is a couple years behind. we see strength and latin
11:33 am
america and asia. the consumer confidence is pretty high. >> your stocks at a record high. >> thanks to the power of being on bloomberg. >> obviously. >> the consumer is healthy. i don't think they are afraid of losing their jobs. they are heading into the christmas season with a better attitude. consumer confidence is high. i think all things are good. consumer saying today that is different from two ago?ree years >> you've seen a return of 401(k) balances, i don't think people have a fear of losing jobs. that gives them confidence. clearly the fed feels that way. we've talked about it being a , a gradualcovery recovery as opposed to revolutionary change and that is what we've seen. >> i love skiing. >> he loves fishing. >> we can get to that in a moment. , in many cases,
11:34 am
it starts on thanksgiving. what is the outlook for ski season? you have got a great portfolio but fewer and fewer americans are skiing. >> why? what are we doing? snowboarding? , a publicly traded company, they say that fewer and fewer americans are skiing. participation is flat. it is a market share gain. good of snow trumps a down. if you look at 2008, we had our record performance. people who use it as a family pastime, they're going to do it. we are expecting snow in the northeast this weekend. there has been snow in aspen. i think our brands will do well. >> is that why you are in so
11:35 am
many different businesses, to hedge? people might not be skiing, they are drinking beer. >> there are a lot of natural hedges. if the winter did not come along, our fishing period would extend. heat, our jar business might not do well but our cooler business would. >> did you design it that way? lucky.s easier to be but now we are certainly looking at opportunities to hedge within the business. >> of all the brands i'm looking brevile, great appliances. best one what is hottest right now? >> the crown jewel.
11:36 am
>> a great christmas gift is going to be the draft mark system. is 4999.e, it people still like baseball. aroundf enthusiasm baseball. a lot of letters from our new ski products. a lot of innovation. e products at every price point and lots of opportunities to meet consumer needs. >> where else do you want to expand? >> we're just looking for opportunities. of companies, we have some cash outside the country. deploy thatng to cash as opportunistically as possible. i was at a meeting domestically, aretential acquisition, we looking at things and latin america. >> what qualities does the
11:37 am
company or brand need to have to appeal to jarden? >> good cash flow characteristics. margin and creation, something that is not going to take us backwards. businessel the forward. we are looking for a presence in a country where we can bring another brand. coleman australia is introducing the ball jar. we are leveraging that platform to grow organically. we made an acquisition in brazil. we are putting more products, first alert is going into brazil. you establish an acquisition that gives you a ehold in a country, you can export this products there anyhow. brazil is more complicated because of the import taxes. a place like south africa, where we had a subsidiary operation, we are putting all sorts of
11:38 am
products into that. which is primarily be fishing business. they will leverage the front office. >> geographically, what is the most attractive worldwide? >> we are bullish on the u.s.. we think the consumer is strong. we feel great about europe. >> you are the first person who feels great about europe. not ais a marathon, sprint. we are looking for opportunities that can establish the long-term presence of the brands and grow the businesses. europe is a couple years behind us. whether it is taking the rawlin brand into japan, extending another brand into china. we are looking at opportunities where we can have the number one position in a niche market. we think that will carry us to times and good times. -- will carry us through tough times and good times. jarames lillie, ceo of den. meet the master distiller
11:39 am
behind some of the most expensive bourbons. ♪
11:40 am
11:41 am
11:42 am
>> 30 years ago, bourbon was not a trendy drink it was today. that is when a distillery in kentucky made the first single barrel bourbon. is a big seller. here with us is buffalo trace's master distiller. what kind of lightning are you trying to capture? what is it you are trying to appeal to any taste of a bourbon drinker? >> it is a single barrel bourbon. >> explained to the uninitiated. >> there are several different styles of bourbon whiskey. one of the premium categories is
11:43 am
single barrel bourbon. , a personat works goes into the warehouse and selects a barrel based on taste. it is very high-quality, superpremium. that person is the master distiller. there are a lot of companies that do single barrel bourbon. we were the first in 1984. there are other companies doing the same thing. >> bourbon is so hot right now. >> why? >> going faster than white rum or vodka or gin. what is it that the liquor drinker is looking for that has made bourbon so popular? >> i think what people are looking for its quality for their money. and authenticity with bourbon, you get that. you get a lot of stories, and a
11:44 am
lot of history. high quality. i think that will be the difference between a lot of spirits. >> fly now? -- why now? from 1984 until two years ago, why is bourbon hot now? >> it has happened over time. because it has grown a lot in the last two or three years. but really it has happened after the last 25. you are sitting there as the master distiller. you must talk about the prospects for the market. do you worry that peoples' tastes are going to shift? they might shift from bourbon to dark rum or canadian whiskey. the canadian whiskey makers want a piece of the action. they see brown spirits like bourbon taking off. didn't we invent rye? >> we do not worry but we look
11:45 am
at all the variables. demand isok like the going to remain strong into the near future. we are doing things to ensure that. ensuring quality. >> bourbon is popular, rye is hotter. there was a good reason that rye was not popular, it is-a particular taste that does not appeal to that many people. what explains that popularity. >> rye is a big flavor for cocktails. that startedcraze 15 years ago, it allows the makers,rs, the cartel to have an ingredient was a lot of flavor. hepeople watching could say knows bourbon, he is a kentucky boy. you have degrees in chemistry and chemical engineering. does that influence what you are doing?
11:46 am
the magic you are creating. >> it does. when i first started about 20 years ago, and allowed me to understand the business. why do we do what we do. it helps ensure quality and processes and things that we do to make sure it is consistent from batch to batch. , you really learn on the job. most of the things you learn are on the job. >> what is the next trend? what are you making now? >> when the things we are known for his variety. we are trying a lot of different things. what we do know is the public is interested in something all the time. something new. >> like honey flavored bourbon. honey flavored bourbon is popular. we tend to look at a more traditional style offerings.
11:47 am
bourbon made a different way or distilled a differently, not just flavors. >> are you looking at different grains? >> we are. >> what do you think has real promise? ohio theourbon made in other day. and a real bourbon be made in ohio? >> bourbon can be made in any state. -- ithas got started has got spelted wheat in it. different grains, different installations. we look at different ways of aging a barrel. a big contributor is wood and how does the wood interact with the bourbon. >> how much does that cost? >> it probably averages $50.
11:48 am
new york city, maybe 55. >> your average price is around a $55 bottle. $30.obably around we had a lot of bourbons around $25. some that go for -- >> couple that go for a couple hundred bucks. >> thank you so much. harlen wheatley -- we will be back with more "market makers" in a few. ♪
11:49 am
11:50 am
11:51 am
>> welcome back to "market makers." there's been a story in the -- iines this week around will not say our headlines. really, in the tabloids. >> serious tabloid fodder. >> tout health care banker stage
11:52 am
kelly at jefferies going through a nasty divorce. a custody battle. not something we will talk about in terms of the financial industry until today. sage kelly, a top health care banking team. a switche team made and moved to jefferies. such a good team that ubs sued jefferies. an extraordinary divorce proceeding. wife is alleging that there were other members of the jefferies team involved. >> these are just allegations. >> these were sealed court documents that have now come out. why is this jefferies problem? as soon as clients and businesses are mentioned, it becomes a problem. he is leaving voluntarily. >> that is the news. >> just allegations.
11:53 am
think about this for a second. think about all the volatility in the market. if you are rich handler and this has to be the most important thing you are dealing with. >> he's the ceo of jefferies. put out a statement. "we cannot express how deeply we regret the agony and distraction this has caused all of us, not to mention our clients." here's one thing i will point out. clients, these are ceos of publicly traded companies who have been maimed, or an officer of jefferies. if they are lying and denying what they have done, they could go to jail. if you're an officer of a
11:54 am
publicly traded company and you like, you will go to jail. is sage leaving on his own or are they forcing him out? >> it is almost immaterial. >> it is ugly. >> it creates some difficult decisions for a guy like rich handler. thisare all allegations at moment. we do not know who is telling the truth. you want to give somebody the benefit of the dac. innocent until proven guilty. the worst this gets and it is getting worse by the day, the bigger the threat it poses to your business. >> when there is this must smoke it is hard to imagine or is not fire. >> we do not know. you need to read this for yourself. >> if i ran a health care company -- number onees was my banker or my number two and morgan stanley was my other
11:55 am
choice, if there was a coin to be tossed, are you going to do business with an institution with this much noise and ugly color around them? i think sage did not have an option. this is ugly. >> yes. >> michael lewis might have a point. >> that will do it for "market makers." -- it ising halloween. we speak to a real estate agent who sells haunted houses. i take you to a coffee shop for the 1%. >> almost 56 minutes past the hour. "on the markets" was scarlet fu. 56 minutes past the hour, let's get you on the markets. a mixed day, need dow is getting a boost thanks to visas plan to charge some u.s. banks higher
11:56 am
card processing fees. the s&p 500 has been bouncing around. we continue to monitor that. joining me for today's options insight is the founder of the day after the federal reserve ended its quantitative easing program. the vix is at 14 .78. is it quiet until next friday? >> i think, but who knows. if you look at where the vix is pricing itself, still in numeral 1% daily move. options are pricing in demand for insurance. relatively high. maybe he market sits here in orx bouncing between the 50 100 day moving average. any type of major surprise, i think this market is so skittish. we could take another nosedive.
11:57 am
all other things being equal, i think it will be slow until we get data like 80 p next week -- like adp next week. record stock is baidu, high after reporting results. results that were not a slamdunk. a sales forecast my treo forecasts. are you seeing conflicting options activity that indicates investors are not sure which way the stockholm is going forward? is very heavy. i'm seeing taking profits and rolling. people that don't cause -- people that owned calls are selling the winning ones. people that owned puts are moving them. reportro and linked in after the ballot. are these bullish options? >> it is a mixed bag.
11:58 am
stockall into the loved category -- amazon, apple, twitter, tesla. they are developing their own chart. go pro is getting weight. then into earnings and the stocks get slapped. within a couple days, they rally back. which leads me to facebook. >> you have a trade on facebook. a rough go with results. loved stockhe y.ttern -- rally, smack, rall a trade i like is a blue diagonal. call, $2.75. sell the $77.5 call.
11:59 am
collect $1.10. $1.60 on that diagonal. if facebook makes the rally higher, i will do well. is it eases back, i can close my november and turn it into a calendar spread. i am playing for an increase in volatility and a bounce in other liars. shares down this week. inare back "on the markets" 30 minutes. "money clip" is next. ♪
12:00 pm
>> welcome to "money clip." we tie together the best stories, interview, and video in business. i am matt miller. tim cook comes out. the ceo of apple says he is proud to be gay. number oneputs the or tries to get the number one on toyota in its auto plant in germany. in politics, gridlock or compromise? the scenarios for republicans in control of congress. au m


info Stream Only

Uploaded by TV Archive on