>> welcome to "lunch money" on bloomberg television, where we tie together the best stories, interviews, and video in business news. i am matt miller come in for adam johnson. let's look at the menu. in socks, could it be the best year ever? that shows noy signs of abating. big machines hard at work. we will show you the biggest earth crunching equipment on the planet. a nation, the regulator gary gensler gives his final word on the new roles for wall street. in fashion, one hot hoodie, is it the greatest hoodie ever

made? ise over celine, elton, this the new face of vegas. we will kick it off with the world. two days, discusses that bombings in southern russia. a few hundred miles from the site of the winter olympics which began in six weeks. the first bombing came yesterday at a train station in volgograd. this is a video. the time of the explosion, a suicide bomber with himself up near a metal detector. 17 people were killed, 40 five were injured. investigators say the toll would have been higher if it had not been for barriers that kept the bomber from reaching a waiting area. the second bombing this morning during rush hour. a suicide mission in the same city on a trolleybus. at least 14 people were killed and .7 were injured. here is your geography lesson. wered why seven -- and 27

injured. volgograd used to be called stalingrad. it sits above the north caucasus, one of the most war-torn territories of the last two decades if not the last century. an insurgencyeen going on going back to the 1990's. this is the most recent manifestation of that conflict. by carrying out these attacks outside the north caucuses, the terrorists are trying to show that people anywhere across russia are vulnerable and that they can take advantage of the media spotlight that is going to be on the country because of the olympics to really show that this is not a local concern, this is something much broader and that they have a much wider reach. >> that is the second reason the location of these bombings is so important. the winter olympics and sochi begin in six weeks. the black sea,n is 400 miles southwest of photograph.

the distance between new york and cleveland. moscow, we have a problem. many problems. to russia in risk terms of its public relations and its economy. i think in that regard, the games have already been a massive failure. the other question is what about the safety of the visitors and the athletes? everybody is terribly worried about that. as you have been talking about, you have the north caucasus region, you have separatist groups, you also have bordering closer to sochi, georgia and the separatist region and the insurgents in alkhazia. vladimir putin's pet project. here he is meeting with dmitry medvedev this morning.

he sent his top ministers to investigate, that has been his only response. >> is has been his immediate reaction. we saw that when he released khodorkovsky, it was without any request, clearly due to his immediate embarrassment. internationals reputation seriously. he wants to be seen as a serious man a strong man. that is hard when things like this happen. >> what does putin do when it comes to sochi? >> they have plans for the olympics themselves. there will be about 30,000 police officers and troops stationed in and around sochi. going to haveow to look at the whole southern extra and try to put in resources to prevent these attacks from taking place. experts are fairly confident willthe games themselves

be secure because there are such stringent security measures in place. the problem is that extremists will try to stage attacks outside the security zone. this is ther that most expensive winter olympics in history. more than $60 billion invested in these games. what if investors and sponsors start getting cold feet? investment a lot of in these games, not just the $60 billion that couldn't and his hisarch -- that putin and oligarch buddies have invested. there is investment from companies and corporations. i think people will wait until the last moment to pull out. >> the security at the actual games at sochi will be tight. difficult for anyone to get in and out of the city starting in january, before the games begin.

does that mean insurgents would try to disrupt the olympics by turning to softer targets elsewhere, perhaps close by to the games in a symbolic gesture? >> that is something to be concerned about. the russians have invested a lot of effort and a lot of procedure in seeing that the games go off successfully. part of that means securing possible.he extent there will be a massive security presence there. it will be a difficult target for insurgents. russia is a large country. you cannot lock down everything at once. likely that you are going to see an uptick in attacks in places like volgograd, moscow, elsewhere around the country as the insurgents try to get their message out. even though the games themselves is going to be too hard. >> what more can putin do? >> that is a tough question. this is an insurgency that has been simmering now for 20 years.

they have managed to tamp it do wn in chechnya that have caused it to expand outward. it has infected the north caucasus as a whole. their socioeconomic problems, tensions. most of the ethnic russian population has left. there is growing ethnic strife within russia between status of and ethnicaucasus russians. there is not a simple solution, >> deep-seated problems, sochi is at the same attitude aas nice in france. mild winters. what was the rationale for hosting the games in sochi? dacha in sochi. he thinks it could be a

year-round resort. they have high mountains 15 miles from sochi. he found an opportunity to turn sochi into a resort. not many people believed this was a good idea, including some of his oligarch buddies who have been making the investment to area.up the ski they are calling for subsidies from the government and asking the government to buy them out. it is a very large question mark. enough snow under thermal blankets so if it does not snow at the time of the x they will be able to use artificial snow. only time will tell what happens. i do think that a $60 billion investment for this is something that has already not paid off and has only brought bad pr and area as aity for the touristy venue. there has been a lot of corruption -- a lot of pollution in the black sea.

local residents are complaining they cannot swim anymore. >> are investors concerned yet ndex is up after the attacks. stocks are a big story in the u.s. as well. what are the pundits forecasting for 2014? we will have the answers to that. later on "lunch money," something chewing up the earth under manhattan. the best of big machines and 2013 is calming up. before we had to break, if you are heading to central america, you may want to stay away from el salvador. volcano erupted, sending a column of gas and ash three miles into the sky. flights are canceled. drive or swim. ♪

stocks, new year's resolutions are getting made and analysts ands, academics, are making market forecasts. one guy who got it right and 2013 is a finance professor at wharton. here is what he saw in 2013 and his predictions for next year. be as good asot 2013, this was one of the very best years. we had three worries of the market that passed. tapering, it did not prove to be a tiger. with democratswn

and republicans coming to an agreement. there will not be a debt ceiling height in february. iran in the short run have been defused. that was hanging over the market. with those three items neutralized and stronger data in the fourth quarter, i don't think anyone should be surprised at the big rally. >> you were predicting it. what are you predicting next year? >> 10% to 15% up. my look at fair market value -- >> 2014? >> 10% to 15%. is theing is is 18,000 fair market value. we are a lot closer than we were years ago when i made a prediction on that. certainly, in the short run, we could go up or down. >> making the right call is not the norm. the best part about watching forecasts from stock pickers is knowing how wrong they will

eventually be. >> when you look back at what was predicted for wall street, you have to laugh. 'ou look at the stock pickers forecast for the s&p 500 and then were the s&p is today. look at how far off they are. the immediate forecast was a ofs of 17.5% -- a miss 17.5%. analysts said they did change their forecast as the year went on. this is as the year began. n> you did not believe kreski anyway. you have to put faith in analytical forecasting. >> what about stock analysts who come up with earnings forecast? they did -- forecasts for three quarters ahead. this is what they thought per share would average for the s&p 500, this is what it turned out to be. no better at forecasting the

future. do not necessarily take their advice about where it will end up. economists, the academics, surely they can get the forecasts right? >> economists are just as don and forecasting the future as inck -- just as dumb forecasting the future as a stock pickers. they were no better at picking the future then stock prognosticators. not.viously even outgoing fed chairman ben peers'e poked fun at his inability to forecast. >> given the difficulties economists have in forecasting. [laughter] even the next few quarters, i will point out an advantage to making a 100 year forecast, i won't be around to explain why it was wrong. [laughter] >> if you make a bad forecast,

hide under one of these popular hoodies. miami super sizing its port for big business. ♪

>> there are massive machines working less than a mile from here underneath the streets of new york. it is the biggest transportation project in the country, the 8.2 billion dollar east side access project. the most annoying in the world.

>> fire in the hole. [explosions] done!

>> and traffic will be horrendous until 2019. after that as well. 1300 miles to the south, miami is making room for big ships. three football fields long. an expansion of the panama canal means behemoths like these will need a place to unload. the port of miami wants to real in this business. carol massar shows us how. >> it is a big day for port miami. the long-awaited delivery of cranes, costing $40 million. they traveled more than 90 days from shanghai, battling storms along the way. >> these cranes that are coming in, they are huge. world's largest. they have a reach of 22 containers across.

they are the big boys. >> the cranes are needed for big ships, which now mostly doc in california. -- whichded chamomile now mostly dock in california. miami is hoping more goods will arrive in an enough. ships carrying triple the volume. >> this means digging out port miami. feet, thell go to 50 same depth as the panama canal. to shore ishe goods one part of the strategy, getting them out as fast as possible is the other. to digook us two years the tunnel. >> more than a quarter of the money the port is spending is being spent on this title under

the biscayne bay. >> we will provide a link from a major interstate right to the point. -- the port. loaded onto not trucks will be on a ramp fanning out to destinations all over the country. a bigami is hoping for payoff, a doubling of container yearsss over the next six and 33,000 new jobs. critics say that might be to have, considering miami is one of several ports vying for the business. >> we are the first port in, last port out. we will be big ship ready. >> carol massar, bloomberg miami. want to buy big machines, there are a few companies that make them. caterpillar, the world's biggest maker of mining equipment. they make some of the biggest

earthmoving equipment on the planet. here are the top five biggest from the "lunch money" archives.

>> you can catch all of our best of bloomberg 2013 videos online or on our mobile app, bloomberg tv plus. cftc oversees the 400 trillion dollars derivatives market. its chief is stepping down. an exclusive interview with gary gensler. the stage in to vegas in her new life show. we will take you there later. 26 minutes after the hour, bloomberg tv is "on the markets." let's get you caught up on where stocks stand after a blockbuster year. not much action right now. little change. if you look at the individual tire folly after

the company ended its merger with india's apollo tyre. apollo was supposed to buy cooper for just over $2 billion. ♪

to "lunch money," where we tie together the best stories, interviews, and video in business news. i am matt miller. today's moving pictures. mostel schumacher, successful driver in formula one history is in great condition following a skiing accident in the french out. he underwent brain surgery after falling at meribel. 44-year-old shoemaker retired for a second time in 2012. he won the world championship

seven times. arctic air blasting the upper midwest, winds as high as 50 miles per hour in north dakota, is creating lizardlike conditions. the windchill temperature plunged 250 below zero stop -- 50 below zero. the temperatures are forecasted to last until next year. the philadelphia eagles held off a comeback by dallas to secure the last playoff spot in the nfl. the eagles' win clinched the nfc title, they will host the saints on saturday. one of four scheduled for this weekend as nfl postseason gets underway. gary gensler is about to step down. under his watch, sweeping new rules were adopted for wall street and transparency was

pushed for. gary is still battling banks and fellow regulators on a number of new rules. >> we had five or six go into the courts and we struck the right balance, particularly across quarter. think of it this way. aig who up and 180 billion u.s. dollars had to go into it. out of london with a french tank license. the lessons of finances, we have to cover the offshore operations of u.s. financial institutions. >> one of the most contentious topics they had to consider was the volcker rule. >> it was probably amongst the most challenging. we were involved with 68 final guidances in rules and orders. that is the most challenging. to prohibit on one hand proprietary trading record raise

the risk of taxpayers. it does look like that one is in the courts as well. >> you were not afraid to but heads with the folks on wall street, former colleagues there, and regulators overseas. i heard dan gallagher said at one point in -- among european regulators, your name is like a curse word. are you ok with that? >> we are good friends and we used to commute from baltimore together. we chat about it and laugh about it since he said those words. i am all right and we remain good friends. >> you had to throw a few elbows along the way. >> i look at it this way. are really important matters. the financial market derivatives is 400 trillion dollars in size. that is nearly $25 for every five dollar in our economy. there is no doubt there will be differences at times. we were trying to bring transparency to the markets that

inevitably might take away a little of the information advantage of wall street but help the rest of the economy. it was the 8 million people who as well.r jobs we found compromise. two thirds of our final rules were unanimous. two republicans and three democrats came together unanimously and 85% were bipartisan. ready good ratios for this town called washington. >> you can watch the entire interview, the exclusive interview, online. you can also watch on your mobile device, by the way, with the mobile plus app. the goto favorite casual friday attire, everyday attire for mark zuckerberg. we will hear about the hoodie next in fashion. do not pack. just rent. rent the runway goes to vegas. ♪

>> in fashion, we start with an american wardrobe staple at least to the mark zuckerberg's of the world. it is a hoodie. the greatest hoodie ever made. customers often have to wait months to get their hands on the $89 fletcher. what makes it so special? industry and a lot of other businesses is when you get in the this and this of rolling out a lot of retail between you and the customer, you are adding layers of cost. any business deciding to support the hundreds of retail stores across the country, make a decision about their business model that will be paying for all of that, which, by definition, to tracks from either quality or retail price, if you eliminate those things, it gives you a new way to approach an old problem.

>> your price point is not too far off. quest that is right. we make top-of-the-line quality and sell direct to customers, bypassing all traditional distribution models. no stores and no retailers. >> a lot of buzz around your product but you have a lot of trouble keeping up with demand. does that show the limitation of manufacturing in the u.s. as opposed to the apple model? >> you would think so. unlike the apple model, where it might be as simple as downloading an app, manufacturing requires an interesting matchup between consumers finding out about brands rapidly, matching up against manufacturing, so if someone tweets about our sweatshirt for clothes, thousands of customers can hear about it in an instant and then we have to make the product. it is an interesting dynamic in against, we have

been growing so fast that trying to forecast the amount of demand we will have is also difficult. you are right we are back ordered on products in some cases up to a month. we are scaling rapidly and opening up new factories. we hope we get in front of the product that's the problem. >> you have done work in manufacturing for a while. you started setting out to make the world's greatest hoodie. what prompted you to do that? >> one of the interesting things about the apparel industry is that there is a dirty secret that the vast majority of what you are paying for when you buy clothes are things unrelated to the manufacturing process. i felt there was a real opportunity to eliminate those and build a great product and keep the price reasonable for great american-made clothes, which i think there was a lack of in the market. >> this next company is doing the opposite of the hoodie. rent the runway is expanding with a new showroom in las vegas. the founder of the retail site

explains why. on the dresses and we figured it was a place where everyone wants to dress up so opening a store there made a lot of sense. >> what is the purpose? do they sustain themselves or is the point to drive business online? >> they are different cases. we have our location and women are coming in for 30 minutes and trying on a ton of dresses and booking things within five up.ts coming they are making sure it fits but getting there whole season plant. in vegas, it will be a lot of same day rental. among showing up and saying, short enough, tight enough, right enough. they come into our showroom and then try on our dress. >> is this to deepen the relationship you already have with customers or branch out for new customers? >> we have already started to do both. received both of these cases. existing customers write more

frequently and then new people were nervous and are now coming to us. >> you also have a cool new collaboration with the onset. tell us about it very class herself hasueen bee ticked out styles that reflect her personal style and you can rent those looks. with an partnership world tour, actually in the new york area right now. >> did she design anything? do you have dresses in there as well? class she did not design them but she and her stylist take them out. most reflective of her fabulousness. >> is she come to you? >> this is a partnership so we worked out terms that were mutually beneficial. newou have new 8 -- a pricing engine. explain how that will be different. >> we have rises that are 10% retail price. we have special pricing going on right now, $20 and $.14.

you cannot beat that. these dresses cost thousands of dollars. >> while you are trying on the expensive new year's eve dresses and suits, here is some fashion advice. >> one of the things i get asked a lot about is fashion faux pas is and what you should and should not do. there are no rules anyway so it is up to do -- up to you. know your personality and body shape and job. the safest thing is a white shirt with a tie. personally, i like -- mixing patent with pat -- with patent. it is about you. if you are in a creative graphic, graphics -- design and film, more adventurous. tried to get the shoulders. to the end of your shoulder, and

not hang off. probably the is biggest mistake most people make. you will often see photos of weddings and the sleeve way -- sleeve length is wrong. of yournot the bottom thumb and that is. it is where your thumb meets the that is where you finish. look for suppression, closed that have some shake, so the shape should end up where you have suppression, hopefully, if you have not drunk too much year. know yourself and know your character. if you are a joke the guy and a moreu can wear colorful tie and fun thoughts. if you are classic, do not take risks. do is haveng you can a suit with a funny side. libby just little things you can still do. that is it.

>> in vegas, still a lot of skin there. not least the cousin britney spears just opened her new show. we will tell you about that performance next. ♪

>> in pop, britney spears rocks las vegas. she launched her new two-year show at the planet hollywood casino friday night. a sold-out crowd. what can you expect if you go? 90 minutes long. 21 hits. vodka.service for she performs with a four piece band and 14 dancers. she is the first artist in residence at planet hollywood's newly renovated access theater. show? -- into bernice to britney spears's show? it is massive. seven set changes and a ton of elements and technicolor video

content. a large team. folks have been working under the creative director for almost nine months to request why britney? why bring her to vegas? >> we love britney for vegas. vegasging demographic in from an older generation to a younger. it is driven a lot by the nightclub scene in vegas. what we are seeing is younger customers are coming to vegas more and more. the average was 51 years ago and now it is 46. we are capturing the trend. set.ey is the perfect align with her grand planet hollywood? >> it is perfect. all about fame and the celebrity element. we think it is the perfect fit. >> once you get all of these

people there, because it is a different and younger crowd that may be new to casinos. how do you keep them there and spending? what is the hook? >> it is easy here in vegas these days. capital in the world. it is vegas. folks are coming here to be here for the bottle service and the parties and the tj's. folks are here. instead of doing nightclubs two nights, they will do one night and britney on saturday. not a difficult thing. >> what is the next that? theater is for this to have a rotation of pop residence. she is the first contemporary pop artist to have one. what we are doing here is looking for artists that fit the different demographic. it is easy. open up billboard magazine and find the top 40, folks charting

doay or could potentially residency with us. >> britney is not the only one looking to create a unique life experience. groups are going holographic, as cory johnson found out. >> old dirty bastards young again and alive again. ♪ the hologram trend started at the music festival. tour tickets spiked and 15 million people watched the hologram on youtube. album sales jumped five percent. 75% boost in two weeks. why set the stage with a hologram? >> with digital music destroying the industry, old business models, live concerts

have become the bread and butter of the industry. >> a vital part of the business. >> rappers are using the hologram technology to create an intergraph this live performance with their long dead mentor for the rock the bells tour. --bringing the live elevate the live element in with the avatar and the whole existence of his life. we had to share that 18 years later. it is off the hook. >> this technology is an old trick. here is how it works. images of the artist performing our projected above the stage onto a mirrored surface. the mirror reflects those onto an angled transparent screen. class you cannot pay for this. it is worth your money. >> cory johnson, bloomberg, san diego. >> today's mystery meat, go for the burn, christmas is over, but santa is getting a workout in

serbia. >> your snoring sounds like a freight train and it is

♪ it is 56 past the hour and we are on the market. let's take a look at where stocks are trading on this day of 2013. stocks are little changed right now. trending home sales rising but coming in short of estimates.

the s&p and the nasdaq are off just slightly. in terms of individual movers, we want to highlight a couple for you. genetics, a company that provides gene tests for breast cancer, they are trading at the lowest level in two years after the u.s. suggested cutting off reimbursements i almost half. disney is trading at a new all- time high. guggenheim securities raised expectations on shares. of sevenh price target dollars per share. we are watching shares of crocs groupng after blackstone offered $200 million investment in the struggling footwear maker. it tries to revive its fortune after some sources say it tried to sell the entire company. cristina alesci have been following the story. explain to me what happened. a heard they were looking for

buyer for the entire company but they get a partial investment from blackstone group what do we know? let's blackstone is giving investors confidence. they could not come to a likely evaluation meeting of the minds about how much the company is actually worth, so they settled on the deal of a private investment. less because of what crocs will do, take the investment it was getting from blackstone group and repurchase some of the shares publicly traded. that is why we are seeing a positive reaction to the market. isp in mind also that this an approval from a big and well- known investor that says we are confident the company can turn itself around and introduce new expandingnd continue internationally. chrysler does the confidence come from? crocs have been struggling and

it is seen as a data's product. in a?oes blackstone see >> a very good question. you have to look at it as a financial investor would. they probably ran the numbers and said, ok, if they make the investment, we will probably get a certain percent yield on it. they probably do not need to turn around the company completely. do is see a need to little bit of topline growth, may be in asia. the ceo is on his way out. a bet on management. blackstone has two members on the board now. they will probably help hire someone they think will be able to boost that a debt. maybe the bottom line as well. >>) another deal today, bob's furniture. >> yes. another deal in retail consumer similar sectors, not the same thing. bob's discount furniture. this is buying it from another private equity firm. because private

investors do not like to see private equity fall from one company to another. but this may be a play on housing at the end of the day. more people have confidence buying homes and seeking out mortgages and potentially buying furniture for the new homes. that is what the bed is here and that may have given confidence to pay the premium the private equity seller may want. >> and plastic shoes. a big day for private equity today. >> smaller deals. quest that is fine. once againhe markets in 30 minutes and bloomberg west is next. ♪

♪>> welcome to the early edition of "bloomberg west." johnson coming in for emily chang. our focus is innovation in technology and the future of business. let's get straight to the rundown. from alaska to meet your -- just green light.he business opportunities for the robots in the sky. share buyback plan before shareholders. then he urges shareholders not to vote for it. could apple have a plan p