i am mark crumpton. the is "bottom line," intersection of business and economics. samsung unveils but latest galaxy smartphone. former imf official discusses what is next for the ukraine here to visit rheem court looks at president obama's time and change policy. -- climate change policy. to our viewers here in the united states than those of you joining us from around the world, welcome. we have full coverage of the stocks and stories making have lines. justices of these of rheem court

heard arguments on greenhouse grass -- greenhouse gas regulation. peter cook a looks at the call for a smaller army. raking developments at the world congress in barcelona. >> good afternoon. one of the comments has been from mark zuckerberg -- sort -- mark zuckerberg who did this. this is a company that positions itself as a leader in mobile communications. no surprise to see mark zuckerberg at an event focused on mobile here it they're trying to reach out to phone carriers to see if facebook in the near future can find more partners to basically get the internet into the hands of work he will. working between three and five carriers to help a spaghetti people who do not have access to data on their phone access to it. a big factor from that would need facebook.

if successful, it would get facebook in the hands of more people. the company looks to grow. example was last week's $19 billion purchase of the messaging app. he was asked about the purchasing price. he thinks despite all the wall street controversy that the business could be worth more than $19 billion just because if it is a platform that could get to one billion people, which he seems confident it will, then there are few examples of those kinds of platforms around the world. there are some questions about where this company's future growth is going to come from. this is one of the areas they could be looking forward to that. >> but look at the other companies. tot is microsoft doing broaden its presence question -- presence? in the case of microsoft, one

of the questions, given that more people are going to be discovering microsoft and windows through their smartphones is how do we get our windows software and more software devices? to this eventgone with a focus on trying to focus more phone partners around the world and where it could potentially offer a lower-cost devices. it has been there both with apple and google are android. she gave the market should they hope will keep them relevant going forward. this is the another part of that strategy. this story on a -- roku idea.to >> apple tv has a comparable

project. we have learned that while the company has not made a final decision on doing an ipo, it has spoken to bankers and is certainly thinking about the idea of potentially being the one company in a fast growing that would be a standalone, a company that investors could look to and say this is the company that truly specializes in this area. the company doesn't necessarily need money right now. they have some high-profile venture capitalist backers. tune into "bloomberg west lowe's quote two days a week -- to times a day. is back ine court session. this morning the justices heard oral arguments about whether the environmental reduction agency permit right to place

requirements on factories. we are joined my from outside the high court. who is required to get these permits? about 700re facilities required to get them right now. not for greenhouse gases. we are talking refineries and power plants. inht now they are limited how much other pollutants they can put out and what the epa wants to do is required then and getting them to agree to limits on big greenhouse gases. overallig a part of the epa climate change efforts are these requirements? >> it is relatively small. it is not nearly as important as the nationwide standards for power plants that the epa has performed -- propose. thenhave potentially told you have gone too far. that would have a lot of symbolic significance. these are in place now.

the supreme court would be rolling this back. was a clear indication from the justices which way they might roll? likes not real clear except that they did not seem to want to issue a big ruling. they were exploring the possibility of something narrow. into thenot call question in 2007 when they said the epa does have general authority regulate greenhouse gases. you might have a narrow victory for the industry. you might have a narrow victory for the epa. >> what are the economics of this? industries are saying that there is a real potential that millions of sources might be limited. we're talking about tens of billions of costs. they are not just attacking this

narrow provision but other provisions as well. there is a huge amount at stake over how to limit greenhouse gas emissions. >> greg stohr joining us this afternoon. coming up, the challenges facing the ukraine. a closer look at the economic and financial hurdles ahead for the country's interim leadership. tom lipsky points meet when "bottom line" continues in just a moment. ♪

>> ukraine's finance minister says his country needs $35 billion to survive this year and next. my next guest says while there is a war for international assistance, world leaders are looking for the government to commit to reforms of first. john lipsky is the distinguished the johnscholar at hopkins school of advanced

international study and also served as the first deputy managing to rector of the international monetary fund. welcome back to "bottom line." what are the economic and political challenges that ukraine faces right now? akes the economy has been in modest recession. most importantly with big dislocations including a budget deficit of about 8% of gdp, a current account deficit of about numeral a percent of gdp, energy subsidies of almost 8% of gdp. bige really have to be changes. they are on the verge of having to default on debt and their international reserves are very low. >> the $35 million that the country needs to survive, with a request run international aid from tf to be turned it down with our reforms in place first? >> it is hard to imagine the international monetary fund could agree to a support package for the ukrainian government

without a commitment to some significant reforms. they have been on an economic road to nowhere. but what does it entail? >> it is easy to know what they need to do. it is not easy to do it. they need a competitive exchange rate. they need to fix their energy subsidies situation. they need to clean up their banking system and put their budgeting policy on a sustainable basis. very straightforward. admittedly, not easy. recent governments have not been willing to confront the need. summit this weekend. we will get more in depth in a moment. george osborne called on -- toped nations to call provide aid to ukraine. is the political aide there, it is seems not. does that mean his request was meaningless? >> i do not think so. it is a very complicated

situation. it is not a trivial country. it is almost 45 million people. important geopolitical location. it is one if they got the policies right it should be a rapidly growing economy for years to come. is a will tohere support it the ukrainian authorities are willing to do their part and institute the obviously needed reform. >> before we came on air, i interviewed stewart eisenstadt and. the eastern part of the unit crane -- of the ukraine leaning towards to more moscow and the other side wants to side with the ee. the eu/russia split was the reason we see ourselves in this turmoil to begin with. perhaps the politics is above my pay grade in dealing with the ukrainian authorities.

i had a strong sense that ukrainians are in favor of ukrainian independence. russia has very significant economic interest in ukraine. the west is hoping for future relationships of importance. there needs to be a collaborative approach, not an us versus them let's visit the cold war. >> talk to me about the balancing act under way there now. how does the international monetary and ensure that ukraine pays the hvac and at the same couldnderstanding that it be a painful process for the citizens there and also inside are the rebellion? run, it is very clear there will be difficult adjustments. there will be difficult adjustments in any case. they're running out of reserves. they have a hard time paying their debts. their economy is going nowhere with the distortions. have got to fix that one way or

another. the imf has faced these kinds of situations before many times. as i said in this case, the recipe for improvement is quite straightforward here the for a better economic performance for ukraine in the future are very concrete and palpable. there is every reason to move forward with real support it the ukrainian authorities are willing to actually implement the policies that are needed. >> you talk about reserves. i guess that will fall under the purview of the central bank year and they named a new guy today. what would he need to do to stabilize the economy? what type of capital controls should be implemented? they arenot clear that necessary. there will need to be a very explicit and concrete program to deal with the external debt to read as i said, these are the kind of situations -- debt. as i said, these are the kind of

situations of the imf has a lot of experience dealing with. the imf and its members and allies will be reeling to supply necessary funding for a solution, including near-term adjustments if the policies are in place. >> let's get active this week and d 20 meeting. there was an anticipated fight over monetary policy and emerging markets. the fight did not materialize. what happened? >> we saw the g 20 at it that spirit on the one hand, when you are dealing with the finance ministers and central bank governors and a host whose goal among other things is to make this process by keeping the agenda focus and concrete, consider being a venue for conflict, the g 20 is a venue for communication, cooperation,

collaboration, convergence of what needs to be done. if you read the documentation that accompanied the communique that was issued over the weekend, you will see exactly a recognition that more needs to be done all around. 20 may have noticed the g documentation set the output today is 8% below trend, 2% below what the downside scenario was envisioned back at the toronto summit in 2010. the world economy is not performing well. what is needed and laid out in concrete terms in the documentation is a cooperative add 2% to global gdp over the next five years. that is $2 trillion of additional output. >> you notice it is not working the way it should. does that mean that america's leadership is needed? what is the u.s. role in this?

>> the u.s. needs to be supportive of the collaborative effort through the g-20. it was the obama administration in september 2009 that created the framework for strong, sustainable and balanced growth. >> why hasn't the u.s. been able to adopt any of the imf reforms? >> i think that would be too strong. it seems to me there is convergence around the kind of that areinitiatives needed over the next few years. there needs to be agreement on actually implementing them. in addition, only the united states stands in the way of adoption of the imf quota reforms that were agreed in seoul in 2010. the u.s. needs to step up and put its political mind behind the collaborative and cooperative effort that could produce better economic results. >> we have about 30 seconds

left. the tablesummit set for the main summit that will happen in november in brisbane? >> exactly. there are a set of meetings of both the finance meeting dutch governors and the sure person -- governors and the sherpas. capfinance ministers produce concrete advances. what is really important is that the politicians and the heads of government put their political impetus behind really accomplishing something. >> it sounds i sometimes they need to get out of their own way. , also served as first deputy managing director at the imf joining us in the studio for an extended interview. it is a pleasure. miggy so much for your time. congress continues to hold its purse string tight as the defense department get an early campaign for the budget. we will get that win "bottom

line" continues in just a moment. ♪

thehuck hagel has unveiled pentagon latest budget plan and it is already coming under fire. --cher cook joins me on the peter cook joins me. >> he is proposing to shrink the u.s. army. they are doing more with less overall here it is sequestration doesn't go over, it will get worse. it will be a particularly tough sell in congress.

some lawmakers are promising to alter the land at this point just to see releases it. spending next year. he is proposing to reduce the .rmy from the current he is looking to save as much as $3.5 billion over five years by retiring the popular tank killer. drones will replace the spy plane. he is proposing benefit changes for current and private members of the military and housing allowances. choices would be even tougher is sequestration did not go away. >> sequestration requires cuts so deep, so abrupt, so quickly, that we cannot shrink the size of the military fast enough. in the short-term, the only way to implement sequestration is to sharply reduce spending on readiness and modernization

which would almost certainly .esult in a hollow force >> sequestration is the law of the land right now. he is not killing any major weapons. this is a blow to lockheed martin. problem will drone continue to grow but not at the levels first anticipated in this budget. will not take a major hit despite the high-profile problems. that is a big plus for law he -- lockheed martin. basically is looking at this, saying things could even be worse. investors are betting some of these reductions outlined could be reversed i congress. >> what about congress? where might they take aim? ati think they will take aim almost every single line. two areas in particular, the

if itsation changes, then changes, those of the controversial and ultimately be decision to lower or reduced the u.s. army totals. that will be controversial. i expect that to be challenged by several lawmakers. >> peter cook in washington. thanks. bloomberg is on the markets. julie hyman is standing by. hi. for the another record s&p 500. a big rally today. not for any macro fundamental reason. we do have health care insurers leading some of the games. the s&p is rallying by 19.5 points. the dow gaining one percent. a big update today. individual other stocks, we're also looking at the owner of taco bell taking owner mcdonald's. likeenu includes foods

invitations. the offerings will be available at nearly all stores later this month. we will have more in 30 minutes. we will have more coming your way next. ♪

>> welcome back to the second half hour of "bottom line." let's check some of the top stories we're following for you. ukraine's acting government has issued an arrest warrant or victor unico pitch. he's accused of mass crimes against protesters who stood up against his rule. russia question the authority, calling it an armed mutiny. he himself has reportedly fled to the black sea peninsula of crimea in ukraine. traffic has come to a halt in parts of venezuela's capital

after opposition protesters set up barricades. opponents have been staging --ntry right protest countrywide protests. they blame the government for the country's high crime rate and economic trust. after a warmer than normal weekend for much of the united states, the polar vortex is making a comeback. a blast of freezing air is forecast for the central and eastern u.s. this week. two storms threaten to bring more snow to the northeast. that is a look at the top stories. commodities the reports. su keenan is in the news and for the details. >> good afternoon. this is driving across the board. it is sending natural gas on another ride. oil is back above 100. 11 times sincehe february 7. they talked it up to a one-two punch.

the stock market charging higher, all of this is providing this out. check the hits keep on coming. we saw wide swings in both to wretch in spirit it is up 10%. we are down now. the polar vortex causing hedge funds to piland. they are pushing this 15% higher. bullish that are up for a fifth time in six weeks. the big oak as traders say is the end of the supply. a hot summer. something to think about. already it is summer in brazil which had the highest or driest january in six decades. chart.ut the highest in a year and a half. more rallies absolutely weather driven.

would you believe gold is up roughly 11% since the end of december? february is on track for a second month of the gains. it is boosting safe haven demand. >> winky. john dingell is announcing his retirement today. it is the longest-serving member of congress in american history. he has served in the u.s. house since winning his late father's seat in 1955. he became the longest member of congress in june 7 when he eclipsed the record held by robert byrd of west virginia. he master legislative dealmaking and was fiercely protective of detroit's auto industry. elsewhere in michigan, they're working on the strategy to emerge from bankruptcy. they foul the plan of adjustment, promising to shed billions of dollars in debt. at the same time, investing millions in technology. sandy is the president and ceo

manager.int regional welcome. it is good to have the back on the broadcast. >> thank you for having me. the chamber called the actions outlined in the plan reasonable and unprecedented. union leaders called the plan unfair and unacceptable. it seems there is no gray area here. some retirees are going to feel some pain. are you confident the plan of adjustment was the best available strategy? >> yes. this is very much the right course of action. the reason the city is a bankrupt is because the resources do not exist to pay all the obligations. no one goes into bankruptcy think they're going to go out whole. toy have the best story tell. it is tragic that they may only get a 75% of what they are truly old. the resources are not there.

get $.20nly going to on the dollar. this is pain that is shared by everyone. >> it the plan is eventually and we find out the bankruptcy judge will hear the final arguments on this sometime late spring or early summer, if the plan is approved, what message is it going to send to other municipalities who workers believe they have been guaranteed a certain level of retirement benefits? that is up to the unions represent the workers that are doing such this to really ensure solid.e pensions are we have not funded this, especially at the government levels. we need to invest now in these pensions. it is a wake-up call for wake-up

calls all across the country. they need to be protected. >> it seems like the shame of this is that there have been warning signs for decades. this is not a new occurrence. this has been building and building over time. the people say i leases 1960's. how have things been so violently out-of-control? >> we as a city did not have any focus on user at all. at the what we could pay moment. we never looked to the future. we never did any long-term planning. governmentegional all across this country. there is one right next door to detroit that has done an amazing job managing its finances through the good times and the top times. the city has not done that.

we are in the worst possible situation. the city workers who are owed money will not get everything they are owed. creditors are going to get pennies on the dollar. there's really no other option. the plan envisions detroit spinning things for repairs and upgrades. if the city cannot pay pensioners, how can they, with that amount of money for other things? >> municipal bankruptcies are a little different in the sense that in a corporate bankruptcy you can liquidate the company and not worry about the viability of the company. inducible bankruptcies in federal courts are very different. judge must take into account the viability of the city going forward. if the judges not seeing the kind of investments necessary to he or sheity viable, has the opportunity not to

approve that deal. there is a delicate balancing act that needs to be hit. we need to have the right investment to ensure the ongoing success. we need to do everything we can to protect the pensioners and pay the unsecured creditors. >> we have a little less than a minute left. -- do you convince destroyed detroit residents to stay? what can you say to them right now if they are thinking of leaving to let them know that you are sure that better days are ahead for their city? just elected a new mayor. he said to be all, give me six months to help fix the crime problem. give me six months to help fix some of the systemic issues in town. >> is that overly optimistic? >> i don't think so. to bel the problems going solved in six months? absolutely not.

you're going to see tremendous progress, especially on the crime front. we have a new chief of police who is doing a fantastic job. we are seeing a lot of private capital investment. downtown university housing is sold out. you cannot get housing downtown if you wanted. downtown now has traffic jams. we are seeing a lot of positive progress but a long way to go. please, let's stay in touch. this is a story that has some legs and hopefully has a positive outcome. thank you for your time. >> thanks. "bottom line" continues, television viewership surrounding the olympic games when we come back. ♪

fax harold ramis died earlier this morning for complications .f auto you mean -- auto immune he is also closer to bill murray in the comedy stripes" wrote "national lampoon's animal house." his directing credits include groundhogack" and " day." we turn our focus down to the winter olympics. by all accounts it was a win for nbc. as of last thursday, nbc racked up the most of yours amongst its competitors. is at horizon media and joins me here in the studio with more. it is good to see you. the good news, nbc dominated the ratings for seven days. it will make money unlike vancouver. the bad news, the median age was 55. what is up with that? likely let things on

broadcast tv, they are getting older. we're going to have the academy awards this sunday. the last two years this has been above 50. the broadcast networks this year are averaging about 54. i think the young viewers are migrating toward online video. in this he provided for the olympics. america's poor showing in hockey and ladies figure skating. lindsay vonn did not ski because of injury. did that hurt viewership? what i think so. if you look at the highest-rated event every year, it is ladies figure skating. lipinski.o tara a -- thehe there is thursday night at about 30 million. tara lipinski is the youngest ever to win.

>> online videos and social media. did that impact your ship? >> it did. i think that is what makes the olympics so appealing. are better than to reno, online video is very popular with hockey. it was on during the daytime. "house of cards" had a number of streamers. did 10.1 semi finals million users which was a record. >> i mention vancouver. why? what was the difference between sochi in vancouver? >> one was in this he paid more money for vancouver. they paid more for rights. marketplace is much stronger from 2010. the deals were 2009. they were coming out of the great recession. the economy dictate the advertising market. >> we will be back with right aggie talking more about in bc

-- would brad adgate. talking more about nbc. >"bottom line" continues in just a moment. ♪

>> we are back with the senior vice president of the georgia research upper rise in media. we are talking the tonight show jimmy fallon. it debuted last week you're the numbers were impressive, a point 5 million viewers. what is the historical content for -- context for viewership that large? conanis larger than what did in his first week in jay leno second first week. this is the most watched week since 1993 which was the cheers finale which got huge numbers because it connected with the tonight show. this is one of the halo effects of the olympics. it promotes the late-night shows. it serves as a platform for seth

meyers. the very least people know jimmy fallon is hosting. there is a very high awareness. >> would have done so well without the olympics leaving? >> i do not think so. i think tonight we will get a better opportunity to see how strong. >> is the honeymoon over? >> he did a .5 million viewers. jay leno was averaging about 4 million. he do more than double that. that is a pretty strong in number. you have to go back years to see a late-night show develop -- deliver that kind of audience. it was an atypical week. >> tonight's admirers is going to be on at 12:30 a.m. what are your expectations? >> i think he will win the time. he will be up against craig ferguson at cbs and nightline. not as much competition or people watching television at 12:30 a.m. he should do pretty well. i think he is well known.

be ank there will curiosity factor because he is never done something like this. he said himself that he had never been on camera so long that one time. >> he's another disciple of lorne michaels. now the king of late-night. >> he is. >> the kingmaker. >> exactly. that is so fractional eyes. the other thing is that viewership is very stable. i think it is really important that jimmy fallon started out strong. hopefully the sampling people will stay with them for nbc's estate. campbell and letterman are very strong competitors. they have been there over a year. the viewing patterns do not change. as is a volatile part. >> you have fallon and myers. what does it mean for letterman and camel? >> for them to try and maintain the audience they have. as anan let to this opportunity to take some of the

audience that may not want to watch jimmy fallon. is a very disruptive time when you get a new host at a new time. it gives you an opportunity to take as many viewers as you can from the other guy. >> what about the generational split, is it obvious? >> yes. broadcast tv is kind of like the olympics. the younger folks are either watching adult swim or they are watching cable with comedy central or conan or they are on their dvr playback. >> no doubt. brad adgate thomas director of research at horizon media joining here at the studio. it is good to see you. stay with us. another check on the market movers is on the other side of the break a. "bottom line" continues in just a moment. ♪

>> get the latest headline streaming on your tablet and on bloomberg.com. that does it for this edition of "bottom line" on bloomberg television. i am mark crumpton reporting from new york. thank you for joining us. i will see you tomorrow. "on the markets" is next. ♪ you caught up on where stocks are trading. we do have a record for the s&p 500. that is something we have been watching throughout the session. the stock set been hovering near the highs of the session for much of the last few hours. the s&p 500 up nearly 20 points. the dow gaining about 175 and

the nasdaq up 45 right now. in terms of individual stocks, let's take a look at the micro devices. the surging to a new 52-week high. they are buying a semi conductor for about one point $6 billion. it will give them a larger share of the market for chips. shares of jcpenney are down not just a day before the it straight session. they are set to report the fourth quarter earnings on wednesday. investors have not been optimistic. the company reported preliminary results earlier this month that fell well short of analyst estimates. we want to turn to commodities. hedge funds have changed to the highest level since 2012. investors bet on higher prices for raw materials ranging from boulder to copy. elizabeth campbell is joining me . it is hard to say a rally in my duties broadly. that is where it is right now. where is this?

global weather is threatening crops across the world. cold blast across the u.s. is increasing heating oil demand. that has helped spurred this rally him bullish commodity bringing them to a 17 month high last week. cold in theeme midwest. we have a drought in california and south america. of weather is a big driver commodities right now. investors are putting their money where this analysis is. commodity fund flows are expected to be info for the first time this month since september of last year. >> what commodities in particular are investors expecting to rally here? are we seeing mostly the stuff affected by weather or other commodities, too? bywhat is really affected weather is coffee. investors have trouble there bullish bets on the most bullish and may 2011. this is because of the drought

in brazil. it is the world's biggest producer of coffee. it had its driest january in six decades. right now it should be getting rain.ign -- that is most important. is why investors are betting that prices are going to continue to rally. they have rallied. lastly, they saw a 19% gain which is the biggest weekly increase since august 2001. it expects yields and quality to be constrained the season and neck season. also, very quickly here. are there any commodities investors are not bullish on right now? they came out last week. they are projecting record harvest. that means we could see more supplies. prices will not rally like some of these other coffee and

drought affected areas? . >> thank you so much. we appreciate it. we will be "on the markets" once again in 30 minutes. ♪ 500 raising to a high. welcome, everyone, to the most important hour of the session. we have 59 minutes to go until the closing bell. desk, carlery big icahn joining us exclusively to talk about his open letter to shareholders on ebay. that is happening in the next couple of minutes. >> you mentioned it all rally -- already, at a big, big rally. lookis going on when you at the broader indexes, let's narrow