>> we are 30 minutes into the u.s. trading day, here are the top stories we are following. boeing's big shakeup. dave calhoun will step down as ceo as the company grapples with crisis. however calhoun will stay on through the end of 2024 and have a say in who his successor is. chips under pressure. after china has adopted new guidelines, designed to limit the use of u.s. microprocessors and intel and amd shares fall. in spring break in full swing. we will check in with priceline ceo brett keller about the state of revenge travel and how the outlook compared to last year. ♪ >> welcome to bloomberg markets.

a look at markets on this monday morning and it is a sea of red behind me. we are talking about huge downdrafts year, the s&p 500 currently off by about 2/10 of 1%, even more so if you go down the list. those big tech names, that benchmark under pressure as well, currently off by about half of 1% and a love that ties back to what we are seeing in the chips face with intel and amd which we will discuss. the philadelphia semiconductor index currently off by about 6/10 of 1%. but we want to get back to boeing, one of the big stories today after announcing sweeping management changes with ceo dave calhoun set to leave the company at the end of the year. the airplane maker is grappling with a safety crisis centered on's most important product, the 737 max jet liner. joining us to help break it down is guy johnson. where does this leave boeing without calhoun at the helm? >> nowhere good.

we've effectively now got a lame-duck ceo at the helm of boeing. stan dio has departed at the head of commercial being replaced by stephanie pope, one inside her another insider. calhoun apparently is going to get a say in who replaces them. is that going to be good enough really? people are asking questions about who that replacement will be and whether or not he should really at this one have a say. this is a crisis going on for five years. it was five years ago those twin accidents killed so many people in 737 maxes when the aircraft first came out. it has been a crisis on going, back at the beginning of this year that we had the door blowout that put so much pressure on dave calhoun and the rest of the team that this wasn't so many ways the ineffable last come. customers have become more and more annoyed with what is happening. listen to the message coming out of the european carrier and united airlines as well. these are the customers getting

more and more annoyed, putting more and more pressure but it is a wholesale change we are seeing at the top of boeing. the ceo is going to step down, the head of commercial is going to be stepping down and actively this leaves boeing rudderless at a critical moment in terms of getting a safety on board, safety sorted out. it needs to get the machinist back on board, it needs to get the engineering back in terms of where it was years ago, pre-pandemic, before we focus on the financials rather than the engineering. boeing has a lot to do and now it is left with a gaping hole at the top that doesn't look like it is going to be filled anytime soon. >> you make it great points, and earlier we heard that he welcomes the much-needed open management change, so let's talk about who could replace they calhoun. like you said, we effectively have a lame-duck ceo at this point slated to stay on through the end of 2024. we don't know who will replace him, but who could? >> there's a suite of names

being talked about this morning and it is interesting to see some of the big insiders as being potential external candidates. the first thing i think a lot of people have got to figure out is is it ok to have an internal candidate come in and effectively replaced it calhoun? catch shanahan over at spirit, which remember, is that the center of this crisis in so many ways, he is currently running spirit and remember, there are talks underway for spirit to be effectively required by boeing. but his seat too -- is he too internal? then you potentially look elsewhere. stephanie pope, looks like she is going to be replacing stan dio. again, that is internal for internal. the name that potentially is being floated around is larry culp of ge. that will be in really interesting one because the rumor in the aviation sector is larry doesn't want the job. he has just come out of a

crisis, he has just fixed ge. ge in so many ways is a bigger, better company than boeing at the moment, why would he want to swap one crisis for another? he has the engineering background, he has that kind of skill set that is made wire, but does he actually want the job? which then raises the question, who would want this job? boeing is any of difficult place. you got customers, staff, regulators, politicians on your back. this is a difficult job to take on at a really difficult time. >> it is a joy to talk with you. of course we don't know who the ceo will be but what we know right now is that boeing ceo dave calhoun is stepping down at the end of the year. joining us now for a broader look at these markets, we're joined now by alfonso, the macro compass ceo. i want to talk you about boeing but i want to talk about this line in your notes since it did give me a chuckle. you write that if you take a look at market right now they

are priced as if the next three to six months will be one of the most boring macro periods ever. so that is what the pricing is telling you. do you think that actually will be the reality, though? >> not really. that can be fun for investors because one thing i notice is that if you look at the implied correlations priced within the s&p 500, they are not priced at the lowest level almost of the last 10 to 20 years. what that means is that investors are happy to sell a jumper risk, to sell an event in which you some off rapidly and these correlations will go all of a sudden back to investors are betting against this. it is another way basically to monetize. it seems no one is worried about anything anymore, including they are not worried about upside anymore. also if you look at options, they are particularly cheap as we speak. basically we have investors betting on the fact this is going to be one of the most

warring macro environments, it like 2017 or 2019, where stockmarkets slowly drift on the right and higher, but in a very boring, predicable way. while there are actually quite some risks for macro volatility both on the upside, the downside. so the setup is quite interesting. katie: to meditate a little bit longer on the point you made about correlations within the s&p 500, it sounds like what you are saying is that stocks are responding to their own idiosyncratic factors rather than the whole index moving together as one. >> yes, also due to the fact that the index is now heavily skewed toward a very small number of components that drive most of the returns. but in reality, this correlation we just discussed is a way to try and monetize basically the odds which are lower and lower according to investors. why? because in a rapid drawdown, generally you have deleveraging

events, which force investors to sell any type of stocks. so when the stock market starts having a drawdown and there is a lot of debt especially behind the stock market that precedes the rapid drawdown, during the drawdown stocks will be sold regardless of their nature. in that case, the correlation amongst the s&p 500 constituents goes up every rapidly toward one. and investors now are settling this risk, pocketing in a very low amount of premium, effectively backing the probability that such a drawdown is very, very low. that is another way to basically understand how people are very keen on selling a drawdown. the emerging-market credit spread index is at the 97th percentile over the last 20 years. anything that is basically a well -- a way to sell volatility betting on the fact the market is going to be very boring is extremely popular right now. >> let's talk about what

specific risk could break us out of this. you talk about jump risk. really boosting those correlations back to one. when you take a look at the next six months or so, what stands out to you? >> there are two ways to look at risk here. the first is that powell is potentially making a policy mistake, where he would still back three cuts this year despite nominal growth taking up. we've already seen a couple of inflation prints a bit hotter than expectations were especially the housing market to restart its engine, while powell proceed to head with cuts, this could be a risk which investors could back into the long end of the curve. so while the federal reserve has nominated growth picking up, along end of the yield curve could pick up, and that could cause volatility in equity markets as well. think of the real estate sector or any other highly leveraged sector of the stock market which can suffer if long in interest rates move out rapidly. another way you can generate the

exact opposite. fed funds have been north of 5% for almost a year now so if these macros are still at play, then we are just waiting for the moment they unfold in a more serious way into the labor market, then the macro volatility could express itself on the downside, getting rid higher. obviously it is hard to tell which direction, but my point is both on the upside and all the downside, it is priced extremely cheap. if you are an equity investor running risk, it makes a lot of sense to look at these correlations and try to find some protection for volatility spikes due to macro in your equity portfolio0. jonathan: sit tight for a couple minutes, we want to take a quick look at what is moving underneath the surface of these markets. we are going to do that now with bill. tell me what is going on with big tech. >> a little the selling the likes of apple, google and meta. down about 3/10 of 1%, this

coming after the european commission said monday that apple and google's app store rules could be targeted in the first probes under the digital markets act. the thing that stood out to me is that new subscription fees for instagram and facebook platforms being targeted, firms could be hit with fines up to 10% of global revenue or up to 20% in the case of repeated breaches, so that is really kind of why we are seeing a bit of a risk off mentality this morning volume not too high so it doesn't seem like investors. katie: this was something that was reported last week, but now we've got the official confirmation and it has teeth with. like you said, some pressure. what is going on? >> taking trump media public. friday shareholders approved the deal vote so it cleared your final hurdle. stocks off about 40% now. the big thing if this is a meme stock. the fundamental value you can debate all you want, it is not there.

the big thing is keeping an eye on this deal and if or when in the coming days or weeks trump media will debut under the ticker djt. and all things will be kind of considerate on how this is the last, i would say, meme stocks back trading north of $40. katie: never say never, you just jinxed it, by the way. but let's take a look at reddit. shares actually surging right now. when we call this a meme stock? >> it is still a low float ipo. the thing is going to be what drives meme stocks? options did debut are ddt, looking at the lms t function, leading the most actively traded options, so that is betting on a huge rally in the day one session on thursday, a selloff

on friday, now up 11%. it is something we will keep an eye on. katie: absolutely, going to be fascinating to see the options develop around that name. thank you so much. coming up, chip stocks getting sought after reports of a chinese crackdown. details next. this is bloomberg.

♪ katie: check stock targeting hit this morning following worth the chinese crackdown on u.s. chips. china reportedly adopting new guidance to limit the use of u.s.-made micro assessors and servers and government computers according to reporting from the financial times. alex webb joins us now with the

details, and it feels like this has been one of the main arenas where the chinese-u.s. tensions have been playing out. putting it in that context, how big of a step is this? >> clearly a big step the target to of the u.s.'biggest because even together they're always in magnitude smaller than nvidia. but it's interesting to see what they have targeted. data centers and pc processors essentially, these are quite commoditized spaces in the sense that it is relatively straightforward for chinese companies, for domestic companies to offer a competing product. it is harder to do something like that with the chips that the u.s. is trying to stop china from getting their hands on. this really leading-edge process, ships made by the likes of tsmc, also increasing the by samsung. they are putting the block is on

something that is easier for them to block because they have a domestic alternative. katie: talk to me about how much intel and amd rely on chinese consumers. of course, the chinese business. it is a big step, but how bad is the bite? >> china represents about a quarter of intel's business, a little bit less for amd, so it is clearly not nothing. about half of the business comes from computing. the next big section is data, so it is clearly a meaningful part of that business. it's unclear whether this means intel won't be able to sell any chips into china. i suspect there will be some others were they still have the capacity to do so. the thing is, those chips will be less commoditized ones where there will be a higher margin profile. so they still have some scope to do. if they want to get back into this space, they have this scoop. intel and amd will have to

submit all their r&d documentation and code in order to get on the approved list of suppliers in this particular space. that is not perhaps a fairly obvious reason companies would be particularly willing to do. if they lose this business, there is not an immediate and obvious path to see how they get back into it without china changing significantly. katie: intel shares currently off by 2.5%. amd trying to flip positive. we will continue to keep an ion the story. alex webb, thank you so much. and we are back now with alfonso. let's talk about leadership in this market. when it comes to the equity market in particular it is tech, it is these check names. and a lot of people have compared this to the late 90's and call this a bubble. where do you fall on that argument? >> around once a piece -- i wrote a piece once about 1995.

not a substantial amount of cuts. and then it pause for about two years, and if you look at the returns of the stock market, you will find the dominance of large-cap stocks. maybe they're not exactly the same names as today, but big tech's large-cap stocks by and large. so you can say why are investors going for the sake of assets? get it interest rates remain high, people are looking for quality stocks that deliver predictable earnings unpredictable cash flows guess what? big tech does exactly that. there's always the question of investors of yes, but valuations are very stretched. my answer is yes, that is correct but if you look at 1998 or 1999, equity risk premium can get the levels very close to zero. so people don't want bonds, people want upside when it comes

to earning potential growth in this very particular macroenvironment, and that is how the market is behaving a bit today. it is very easy to say valuations are stretched, but the answer is if people have animal spirits, if people are willing to put money at play in this type of environment, they would be looking for quality names, good cash flows, balance sheets and big tech actually delivers in all these aspects. katie: it sounds like what you're saying is they are expensive for a reason, that valuations alone aren't a reason to walk away from the sector which has really been powering gains for quite a while now. > the other way to look at it is valuations are high. whatever type of timeframe you want to put on forward price earnings, for example, you will see that the stock market trades at about 80%, 90% when it comes to expensive valuations. for sure not cheap and i am not arguing it is cheap that i am saying what if investors think that earnings are going to grow, so basically the market and big

tech are going to grow their earnings into their valuations? this could also be a scenario but in general, it is my way to question looking at valuations especially if you are a more short time oriented equity investor were stock investor. valuations are not a great particular forward returns looking at three to six months ahead. they get fired for the next three months if they are delivering returns. so it basically becomes a big momentum trade. an environment which favors big tech quality names and big tech belongs in this basket so you need a catalyst to reverse this and the moment there is nothing going on. the flipside is as there is

nothing going on, more people who go to the momentum basket, and we discussed before the previous segment, both downside and upside protection becomes very cheap and it is an opportunity to think for smart investors. katie: is fantastic momentum trade in the u.s. equity market, how does that compare to what we are seeing. >> if we look at emerging markets, the share of their portfolio was 2020 that show they only own about 7% of their equity portfolio in emerging-market. for comparison, emerging markets represent what he percent of global gdp, so it is very large and there are certain emerging markets are particularly attractive, both because they have a policymaker set up that is pretty stable, which is what investors are looking for, and because valuations are pretty cheap. i would say i would put two names in particular. one is poland and the other is

indonesia. in general, emerging markets or something to look at as an equity investor. katie: really enjoy this conversation, thank you for your time on this monday. our thanks. still ahead, we take a look at the companies making the most social us today in the social climber segment of next. this is bloomberg. thanks to avalara, we can calculate sales tax automatically. avalarahhhhhh what if tax rates change? ahhhhhh filing sales tax returns? ahhhhhh

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>> time now for social climbers. a look at the stocks making waves in social media and first up, chick-fil-a. going to be more like chick-full of antibiotics. they say they will start using antibiotics because of my challenges. remember chick-fil-a serve antibiotic-free chicken at all of its restaurants 2019 but when it comes to this change, there's no specific deadline on when it will rollout. next that we have walt disney

upgraded to overweight. the company is seeing a narrative reset which should result in positive earnings and finally, buying a small german biotech company for a little over $1 billion. the deal is intended to strengthen the cardiovascular pipeline and help the drugmaker expand outside of its core diabetes and weight loss markets. and we did want to keep and i am what we are seeing going on with video, a big place there as well as lucid. take a look at what is going on with lucid shares, of 7% or so after the company is of course receiving an investment from saudi arabia. coming up, a major shakeup at the top, we're going to discuss what it means for air travel. ceo brett keller joins us in an exclusive interview. this is bloomberg.

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♪ katie: boeing is stealing headlines this morning after it announced president and ceo david calhoun will be leaving the company at the end of the year. for more on the stock reaction we are joined now by abigail doolittle. abigail: we're looking at the type of reaction that ceos probably don't love what they are leaving, although david calhoun will be leaving until the end of 2024. this of course has to do with all of the safety issues over the last few years, but recently over the last few months, smaller safety issues but ones of great concern possibly in the manufacturing and supply chain. as a result, we also have other shakeups including stephanie pope who is now going to be stepping ineffective today as the head of commercial airline. spirit getting a nice cruise from all this, plus state

calhoun earlier this morning saying that they are in talks still for a potential deal to reacquire spirit aerosystems and in the separate interview, the cfo of airbus talking about interest in parts of spirit aerosystems. either way, that is positive news for shares of europe. into the bloomberg terminal, we can see the boeing and airbus and back in 2018 ahead of the urgent events, the tragedies around some of those 737 maxes, you can see pretty closely aligned, and then airbus has steadily taken off to the upside, up 69%. boeing on the other hand down 39%. clearly investors want the situation to be fixed. finally we are going into the all-important summer travel season and to some degree, a large tree, we do have travel stabilizing. 2021 numbers after the pandemic, i should say, and then up and away, nearly 190 million people

expected through march 25 of this year, but ahead of that summer travel season, so maybe in the future it will be even higher. katie: thank you so much. for more on the state of travel i'm pleased to say we're joined now by priceline eo brett keller. brett, through march 25, we are in the heart of spring break. what has general demand for travel look like this season? brett: demand has remained consistent and generally healthy. when you look around the world, asia in particular is very strong right now. they were the last three down coming out of the pandemic and really last year, this year is there year. many u.s. travelers are making their way to asia, especially in 2024. europe remains stable and the u.s. has settled more into a traditional pattern where you have a very strong holiday periods and weaker in the trough on the off-season when people are traveling to quite the same degree. katie: i want to get to

international travel but let's focus on the u.s. a little bit because i'm sure you saw miami beach's breakup with spring break campaign. they are really imposing harsher curfews, more drunk driving checkpoints, etc. did that have any noticeable impact on travel to miami over the past few weeks? >> when i look at travel trends into florida, generally they are very strong. spring break always attracts people to warm weather, and multiple cities around florida are at peak demand right now, including orlando to fort myers, fort lauderdale, pensacola. southeast and miami beach have had a little bit of a hit but really look reasonably good going into that market. clearly they are trying to tamper misbehavior in things that go on in that area especially from students coming in, but by and large things remain relatively healthy across florida. katie: good luck to that marketing campaign, not sure if

it has worked just yet. let's talk about the desire to travel because coming out of the pandemic a lot of people have said that is physically revenge travel, that people have been pent up for several years wanting to get out and see the world. demand to asia is quite healthy at this point you see that revenge travel and pulsating anytime soon? brett: i think that was absolutely a term we used coming out of 2022 into 2023 where zoomers were throwing all caution to the wind, spending anything to go anywhere. i think we move past that. consumers are moving into a more traditional pattern and they are planning a little more carefully and confer ways to ensure that they really watch the budget because obviously where things are from an economic perspective, people are watching their dollars. the -- we are seeing more people come in and use coupons on the website, but they still want to travel. they are going to take their vacations, that certainly

remains a priority over physical goods. katie: a good reminder that even though the growth of inflation has slowed, prices are still quite high. but looking abroad and the demand to travel overseas, you do have high prices and ongoing wars in the world right now and then factors such as the olympics coming up in paris. what is the outlook for summer travel as it compares to make the last year or the year? brett: i think the outlook is still relatively strong. u.s. consumers in particular wanted to go to europe. in fact, the prioritized europe over many of the prior destinations that people would go to over the summer like hawaii, florida. so with the demand now still strong to europe, even stronger to asia, many u.s. travelers are moving to some of the top markets in asia. they are going to taipei, they are going to bangkok. japan remains one of the top

search destinations. tokyo is one of the top destinations on the website right now in terms of interest outside of north america, which is unique because of the distance and the cost required to go there. but that is what consumers are looking for right now. >> really interesting dynamic that it is asian travel demand to europe. we opened the second talking about boeing. boeing is the news that the day and it has been the news of 2024 really kicking off with the alaska airlines incident in early january. are you seeing any impact on booking or maybe behavior pattern changes when it comes to flyers trying to avoid boeing planes? brett: very little on that topic. as you saw with tsa checkpoint data, travel strong in terms of u.s. airlines and where consumers are moving across the country. on average, we've seen data up about 6%. consumers are traveling at a high pace, planes are full.

we have more capacity than we did in 2019 and more than last year, but the airline for successfully feeling that. consumers don't have a lot of choice when it comes to be highly selective about which air traffic by i am large accepting that travel very, very safe and something they are comfortable doing especially on vacation. katie: it is a specific type of person checking what type of plane they're actually flying on. some other news, the faa is considering curbing new routes at united airlines and also from my main customers on newly delivered aircrafts. this is preliminary but if it goes through, what impact could that have on domestic travel? >> i suppose it depends on the number of life that is impacting. supply is up over last year and those airlines have more

capacity in the air. you have a number of new low-cost carriers, for example, breeze airways coming on board. they just joined priceline. they opened up over 170 routes in the last year. with that kind of supply coming on board it really helps to offset any potential challenges we may find. katie: i appreciate your thinking. i do want to talk about ai. hard to have a conversation these days without talking about ai. i know that you've incorporated ai tools. have you seen any change in how people book through the chatbot vs. traditional search? >> we haven't seen a material change in the way people are booking, but they are asking a lot of questions to the chatbot. she's fielding thousands of questions a day for consumers as they move the booking process. what it has proven to be is a

very nice helper that sits on the side to answer any action you might have. you're trying to book a hotel, go to a new destination, can quickly answer questions about your destination, the hotel you've selected, even the rooms that you might stay in. she could help apply coupons and discounts. if you're a hopeful utility from that perspective. in terms of changing the entire dynamic of how you book, consumers are still entering through the traditional format. but ai is a great tool to help uncover new destinations that you may not have considered. you hear about the top destinations but there are many dupe destinations very similar in nature but might cost less because they are not quite as sought after. ai is very helpful in helping you find destinations that you otherwise would not have selected. katie: that a good place to leave. really enjoyed this conversation, hope to speak to you again soon. really interesting conversation out of what is expected to be a

very busy summer travel. before we get there, let's get a check on these markets with abigail doolittle. >> s&p 500 down about two tencent 1%, nasdaq 100 down just a little bit more. the vix in the green ever so slightly but still signaling that we have lots of complacency as we have the s&p 500 near record highs. the ten-year yield of four basis points, so bonds are selling off. interesting that we have stocks and bonds selling off on the same day. were we had real weakness before was for the chips, amd in particular. might have been the worst day since january when it was down more than 4% on the news that china is the ring may be limiting or in chips, but you can see we've seen lots of recovery here, so here is the rally that we had last week. just to show the depth, you can see the big tip down more than

1%, just fractionally down 1/10 of 1%, so investors really thinking about that. of course, boeing united airlines, boeing at this point of 8/10 of 1%. including ceo dave calhoun out by the end of 2024, stephanie pope will be in. effective today, the head of commercial airlines hopefully fixed a lot of the safety issues and incidents they had. speaking of safety incidents, a bloomberg exclusive, united airlines down 5.7%, the worst day since january. the faa may take steps to temper their growth in the near term at least. temporary steps that could include not allowing them to use newer planes and also not putting new routes into effect and that of course ahead of that all-important summer season, could be part of the reason that we have united airlines down so much. katie: big time shaping up to be

a very lively day for united. abigail doolittle, thank you so much. >> coming out, the fight at the house of mouse. the latest on disney's proxy battle. founding director of the weinberg center for corporate -- corporate governance at the university of delaware is our guest. this is bloomberg. this is bloomberg.

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>> this is bloomberg markets. you're looking at a live shot of the principal room. coming up, scott o'neill joins bloomberg tv today at 4:30 p.m. new york time. this is bloomberg. ♪ time and effort are wall street week daily segment. today, we are taking a deep dive into the proxy battle brewing at disney, pitting activist investor nest -- nelson pels against bob iger. pleased to say we are joined by charles thousand, founding director of the weinberg center

for corporate governance at the university of delaware as well as wall street the coast david westin. david westin, that annual meeting at disney is fast approaching. david: i worked there for quite a while. i've worked with bob iger quite a bit so i know something about it i don't know very much about proxy fights. charles, apart from who is going to win this, in general, what determines who wins these kinds of battles? charles: it is really the large institutions in most cases. the index funds that own a good chunk of any company. in the end, they really decide this thing one way or the other. if it is really, really close, sometimes the retail base can swing it one way or the other but generally it is a large institutions that make the decisions you. katie: so ultimately the large institutions. with that in mind, what do you make of the campaign by pels so far in swaying them and how do you weigh that against disney's

response? >> he just got the endorsement of iss, institutional shareholder services is really the largest proxy advisory organization. iss carries a lot of sway. they could carry 20, 30% of the vote. the other large provider i think goes the other way, but they are pretty persuasive. a lot of institutions will follow it or, more importantly, will follow the same analysis that iss got to how they got to the recommendations. that is really the secret. this really is a story not necessarily about nelson pels, but disney actually pushing that line. but really it is more about the governance of the company itself. and i think using that sort of analysis i think is why iss came out and favored mr. pels. it is not the messenger, especially when the messenger is

aching and role the company, but simply seeking a look in it, if you will. it is the message, and the message here is pretty clear. both the board and this company they believe did not live up to its role to monitor the management. in taking a new ceo, frankly, the new ceo was picked by the old ceo and remained around for a good chunk of the time the new ceo was there and ultimately was part of the termination of the new ceo and coming back as ceo. that was eerily botched process and a think that the process should be laid at the hands of those who are engaged with the old ceo and the board, who went along with his direction. >> if the goal of nelson pels is better governance, is that going to be achieved by putting nelson pels on the board?

there is no love lost that i could detect between bob iger and nelson pels. is that really going to work in the boardroom? >> sure. a dissenting voice in a unitary group is probably a pretty good thing. if this group had done such a great job we wouldn't be having this discussion. obviously if there is dogma in this wardroom, ceo-led dogma, if you will, because ceo dominates this board, the majority is still the group that was there during the mass. and look, this disney board issue goes way back. this goes back to mike eisner's days. michael eisner's days with the same sort of thing. shareholder revolt as to what was going on. i think bringing a different voice into the boardroom would politely challenge what was going on i think would be great productive i think that is the story here. that is what we have to focus

on. katie: just to meditate on that point a little bit longer, when it comes to the disney board, the sort of issues have been going on for quite a while right now. so is nelson peltz the solution to this corporate governance problem? >> i think he will shake things up a bit. again, he may end up agreeing with the strategy. maybe in the end he says this is the right thing. the point is, you need an outside voice, and outside, active voice to look at it and raise the important questions that need raising here without fear of the ceo saying you're no longer on the border i would like you to leave. which is a concern at many companies where you have a very dominant ceo. i think the fact that he could ask the right questions, he's obviously well-prepared for this, he's been on other significant boards, and generally when he has shown up, things have turned out.

in the end, this strategy for the pond was eventually what the company did. so he wasn't that far off. he and the ceo, oddly enough became pretty good friends. the point is that you need someone to ask the right questions to shake out, if you will, the dogma of the board to force re-examination. once that happens, i think the board itself begins to open up and get refreshed his time to bring some new folks in can do an effective job. in other words, the old board got the company and the ceo lost in the woods. do you really expect those who got you lost to get you out? >> it got them lost in the woods, but how much was it ceo and how much the nature of the business. other similar businesses are not doing much better. warner bros. discovery, how much

is that really a decline in the linear media business? >> if they did such a hot job, why did he get fired? you have to ask yourself. in other words, it is not the fault of the leader of the organization, but a broader factor, then why did the board and the former ceo insist on his departure? that is the issue. obviously all was not well in disneyland, so to speak. katie: unfortunately, we have to leave it there. hope to speak with you again soon. david, it is going to be so interesting of course to see how this proxy battle goes. that iss recommendation for peltz is pretty meaningful. >> aerial showdown come next week. so tomorrow we turn from disney to apple and talk about that

antitrust lawsuit. bill baer, the former assistant attorney general. on friday, we talked to glenn hubbard about exactly what is going on with the alternatives of fighting and trump and investor policy. that is coming up fri. when you automate sales tax with avalara, you don't have to worry about things like changing tax rates or filing returns. avalarahhh ahhh

♪ katie: let's take a quick look at some of the stocks hitting higher this morning and we have disney getting 52 week high. we were just talking about this company. upgraded to overweight at barclays. a narrative reset coming out of first-quarter earnings. fourth-quarter earnings, rather. shares currently up about 2%.

we also have ferrari up about 1.3%, hitting 52 week highs afterwards waste target was boosted to a high of 463 euro over at rbc. the analyst saving significant opportunity, definitely heard that one before. let's assume out and take a look at the broader equity market right now. you take a look, it is a down day, down about 2/10 of 1%. the nasdaq 100 off a little bit more, 3/10 of 1% or so, kind of a down foot start to this trading week, a holiday-shortened week at that. but take a look at the semiconductor index, those chip stocks are back to positive territory even with eft reporting about chinese limiting some of these u.s.-made chips. in any case, coming up we have jack mallard's, he joins bloomberg technology with ed ludlow coming up next. this is bloomberg.

>> from>> the heart of where innovation, money, and power collide, this is bloomberg technology with caroline hyde and ed ludlow. ed: i'm ed ludlow in san francisco. caroline hyde is off. coming up, facing bigger fines. the european union opens investigations into apple, google, and meta in the first probes under the digital markets act. we go live to brussels. we will take a deep dive into the justice department lawsuit against apple. the case is missing