worldbloomberg headquarters in your, this is "street smart -- "bottom line." tensions in crimea escalate as u.s. and u.k. way sanctions against russia. president obama meets with netanyahu at the white house. and we see the results of last night oscars. to our viewers here in the united states, and to those of you from around the world, welcome, we have full coverage of the stocks in stories making headlines today. su keenan tracked the commodity

market reaction to the prices in the ukraine. the political ramifications here in the united dates. and julianna goldman has the latest comments from mr. obama as he meets with the israeli prime minister netanyahu. but first, let's get it the latest on the situation in ukraine. officials say russia's navy has ordered two ukrainian strips -- ships to surrender. this is the worst band office of the end of the cold war. ryan joins the on the phone from kiev, what is the latest in crimea? >> ukraine reporting that russia's navy has ordered two ships to surrender. the acting president of the ukraine says that these ships have been threatened with seizure, and ordered to surrender.

meanwhile the russian defense ministry says that is not true, there is no ultimatum. clear is that the ukraine is in control of the russian military. there has been a real steady buildup since the first eight on fridays arrived and surrounded the bases. and now they are very much a control. >> tells about the situation the capital there. they're preparing for meetings with international monetary fund. >> that is correct of they just sat down with the director. they're going to meet with the imf, what timing, eh? ,kraine intends to ask of and intends to receive a funding --llars of $3 billion in funding.

perhaps in an announcement this week, they think it would take them two to get thes to actually first cache. interesting of with this backed up,tor -- because you have investors really is earned about holding ukrainian debt. the russian military presence in ukraine is helping them to focus western minds, and soda pressuring them to impact gave ukraine this money that maybe would have taken a little bit longer to give if it had not been this way. you.an, thank a look at how united states and other european leaders are spotting to the standoff in ukraine. she will be traveling with secretary of state john kerry later this evening to kiev. what has been the u.s.'s reaction to russia's actions? >> we have seen at the highest

levels, with over the weekend resin obama having that 90 minute phone call with president putin. today vice president item -- biden spoke to the prime , and also threatened increasing double monica, i economic isolation of russia to go forward -- diplomatic and economic isolation. we saw john kerry using big words, and the state department spokesperson today said that the u.s. would hold russia responsible for anything that goes wrong in crimea. the problem is, what can the u.s. do about it? >> what is the likely u.s. response to be, is military action likely? >> it is very unlikely. you are have not even heard, even when president obama said that russia would suffer the

consequences of these actions, he never raised the threat of military force. and even though secretary kerry has said that all options are on the table, he admitted openly yesterday that nobody wants military action. even john mccain, usually a strong proponent of village or a action and getting involved in foreign consulate, even he said that he thought military action was not a likely thing. what we're going to see is more diplomatic, economic isolation. suspending preparation for getting involved in the g-8 summit meeting in sochi, russia. another thing would be following through on that boycott call the -- boycott, or expelling russia from the g-8. that would be a very big move, assetould visa bans, a bans. >> what he economic implications? >> we're seeing european stocks lunging mode -- launching the

most in more than a month. that is because of this escalating tension in ukraine and fears about it hurting corporate earnings. with exposure to russia that are leading the losses. very significant things in that the military intervention threatens to derail energy under vegan. -- intervention. the key pipelines that go from russia into europe through ukraine. we have seen energy analysts saying that it could affect gas prices as far away as great britain. >> and not to mention supply routes as well for troops in afghanistan. how is it then that vladimir putin feels he has the upper hand, that the international community is impotent? >> i think there is very little militarily that the international community can do.

when the kremlin has sent troops across the border in the past of the u.s. and its allies cried foul before. we saw this in 1979, we find thousand eight -- we saw in 2008, but no military action was taken. it is not clear they will go further than seizing crimea, but there is very little beyond diplomatic and economic isolation that the rest of the world can do at this point. it remains to be seen how the ripple effects are going to affect the economy, and also diplomatic ties with russia which we need for other reasons like iran and syria. indira joining us on the phone, she will be traveling with secretary kerry, and we will hear from her when she lands. washington, -- our chief washington correspondent, peter cook joins us now. they are not rallying to the

side, some of them even calling him weak. >> american politics are often stop at the water's edge, not this time around. the president has and probably criticize from top republicans for his handling of the ukraine crisis of and for his handling of vladimir putin over the past few years. it really crank up this sunday when senator graham accused president of bombing -- obama of and today senator john mccain telling a pro-israel group that the crisis is of presidential leadership missing in action. >> why do we care? result of a feckless foreign policy were no one believes in america's ring anymore -- strength anymore. [applause] >> even mccain acknowledged

today that there are no military actions for the u.s. on the table right now besides economics agents. -- sanctions. thugboehner called obama a -- called putin a thug, and that is a dilemma for republicans. unless they are prepared to commit the u.s. military to this they do not have anything all that different from the president when it comes to the ukrainian people. there is some political risk on the table for republicans as well. in the meantime we are going to hear a lot of criticism of the president, and a lot of mentions of that w-word. >> coming up, the developing standoff between russia and the west. we will talk to eurasia analyst about the possible conduct -- outcomes in ukraine. you're watching "bottom line." ♪

>> we continue our focus on the unrest in the ukraine. our next guest says that sanctions against russia will be effective if europe is not aboard. -- any effective if europe is not on board. she joins us now from austin, texas. welcome to "bottom line." thank you for your time. >> thank you so much. >> what is vladimir putin up to? what are his motives? is he trying to provoke a confrontation? >> no. at this time rushes to staking its claim on a country it believes is territorially imperative to brush up on security overall -- russia's security overall. handlennot economically a territory, and the number of people that are in the ukraine to be integrated into russia. it does not what ukraine to be a part of the west. nt a just think

it is imperative russia -- to russia. >> if they do not what the ukraine to be part of the west, does not therefore mean by definition, that russia does not integrity ande's the right of its people to chart their own pat? >> it respects ukraine is an independent country as long as that country does not seek to integrate with the west. the moves by ukraine, in order to try to integrate free trade with the eu would actually harm interests for russia as they are so integrated. it is just to prevent ukraine from integrating further with the west. >> i understand your point, it is well taken. what about the people to decide in moscow? >> it isn't the majority of the people that were in the street. it was the select population inside of ukraine that was in overthrew that

yanukovych's government. seeing counterdemonstration this past week and against the government and integration with the west. united population at this time. >> we have received word that russia is demanding that the cre two ukrainian warships surrender immediately or be stormed and seized. how might the international community responded this action distinction -- is taken? which russia has demanded or given an ultimatum to the ukrainian military team out of the gradient stores that has been refuted by russian forces. there has been an incredible amount of disinformation at this time. at this time there was very bold military moves on russia in which russian military units

surrounded ukrainian military units and essentially crimea has annexed, andally is part of russia's fear at this moment.- sphere at this the west at this moment is looking at trying to drop sanctions against russia. however, this is a u.s. plan. u.s. trade with russia is not strong enough to end up biting rush at all should ancient move forward. what the united states need is for the european union to sign onto the sanctions, however the europeans are not interested in that sanctions. their economies are too tightly tied into each other. told aident clinton closed nato summit back in 2008 that the military alliance was threatening ukraine's very existence by according it as a member.

the warning signs have been there all along, so why was the international community caught asleep at the switch? upit said it would not put with western meddling in their tories it deemed critical to its own integrity. united states some wording -- started supporting groups in the green. -- in ukraine. it has wrapped up its obligations in other parts of the world, and it has a freer hand at this time,. ,. . i have about 30 seconds, what is the starting port -- point for a dialogue at this point? >> the starting point for dialogue is going to have to be directly between the west,

specifically the european states, with russia. russia at this time does not seem interested in a dialogue with united states even though there is an open line of communication. it is looking at the united states is more of a threat while the european states can be more long as itr, as ends up with a neutral ukraine. ms. goodrich, thank you so much for your time and your perspective. we appreciate it. >> thank you. >> when we continue, we will get a check on the equity markets. investors watching ukraine very closely. draw moves and commodities as butrussian barefoot -- bear staples on the run. ♪

>> president obama holding an oval office meeting with israeli prime minister benjamin netanyahu at this hour. we are starting to get some comments from the president on the situation in ukraine. let's go to julianna goldman with the latest area what can you tell us? president obama and the israeli prime minister are meeting right now in the oval office. while much of the focus going into this meeting, and in the days leading up to today has been on the israeli-palestinian peace talks, now we are all waiting to see what president obama has to say about the ukraine. right now we see coming through is that the president is saying considering economic steps for russia. he says it will be costly for russia if they continue down this path. he says they are on the wrong side of history here. we know the president spoke over the weekend with the prime

minister vladimir putin, warning thes we have heard, of economic and political cost of further isolation to russia. , what the argument officials are saying, that this is a guy who is a 19th century, set thattury mind was to be integrated into the international economy. he says that i reject your claim that you feel that russian interests are in threat in work with the international institutions that we have here, we're rolling to help you get -- willing to help you get protections in crimea that will make sure that the russian speaking population is projected. -- protected. secretiana, it is no that president obama and president putin are not

depress -- the best of friends. are they talking at cross purposes here? >> i think part of the issue with the u.s. right now is that they do not know if the information that they are getting is credible. you are dealing with two different countries where you have a trust gap going on. what the administration says is that putin is acting from a position of weakness here. over the past several months, you had ukrainian people rejecting russia, wanting to be more in line with the west. putin palace in to flee his the middle of the night to get to russia, that is the position from which they are operating. >> thank you. uncertainty over the ukraine is putting oil, wheat, and other commodities to their highest in months. fuel have concerns about supply, and demand for a safe haven was all of this.

at the peak of trading oil was at $1.05. as we head to the close of regular trading, we have oil off of its high. up to the highest in four months. investors want a safe haven. speculators putting the most elysian bets on silver since 2012. check out crop futures. the ukraine is a leading we disclaimall, and the most since 2000 well. heat is climbing the most since 2012. you have archer daniels midland winning a report that if employees are fine, but natural gas is a major concern. it has come off of its high of the day, it was up as much as

three percent. and now it is down two percent. you have a big concern that russia could cut off that metals and -- that natural gas supply. >> thank you. it is 26 past the hour that means that bloomberg is on the markets. my colleague alix steel is standing by with the details. >> thank you. let's get you caught up in where the markets are trading. it has been a a difficult day for the markets of they continue to see this downward trend in stock. the s&p is on the low of the consumer discretionary and financial leading the way in the s&p. not only worries about ukraine, but china's official manufacturing gave into an eight-month low. restaurant operator saying lower sales and higher direct costs wiped about seven cents across each share. red lobster is on track. it is a parallel process to have to spin off.

ande also watching the fire security company announcing it is selling its unit in south korea for nearly $2 billion to carlisle. ♪

>> welcome back to the second half-hour of "bottom line." let's check some of the top story that we're following for you at this hour. we are watching developments in ukraine, just moments ago president obama was in an oval office meeting with the prime minister of israel. stepsconsidering economic to isolate russia, considering them on the wrong side of history. meantime, russian forces expanded their control of the crimea region today, and to possession of a crucial hearing terminal that could be used to send more troops into the area.

there also demanding the surrender of two ukrainian warships. has urged moscow to pull back its forces. severe winter weather is causing u.s. airline passengers -- costing u.s. airline passengers. lightrst time of disruptions since september 11, 2001. may be aso airlines much as $5.3 billion in increased revenue. disrupting travel plans for more than 90 million who are sometimes left strangers in cities four days. tona's president is vowing crack down on terrorism following an attack in a train station. stormedn 10 terrorists the station, attacking people with knives.

no group has claimed responsibility for the assault. that is the look of the top stories and news at this hour. staying with china, tomorrow in beijing chinese leaders will be discussing how to implement dozens every forwards -- of reforms agreed to last year. they will cover a wide range of copies, such as having families have a second trial, expanding farmer's land rights, and reducing state controls over interest rates. huge hurdles remain. here with us is someone who has discussed tight as economic goals with the president. now he is with us. goals cover a wide range. they constitute the biggest policy shifts and at least the

1990's. but they are vague. are we going to get some clarity? >> that is one of the things you're busy national people's congress. the reforms that you mentioned that came out of the planning. these are only done every 10 years. the first one was at the beginning of the opening up, and then the second one was in 1994, about going into wpo. i think what we're seeing, is what you have said, the biggest change in economic policy. we moving from export oriented event to domestic consumption. >> are those goals realistic. ? >> this is the strongest president we have seen, and he's going to push economic reform very hard, opening up the financial system. he has a free-trade zone he has announced, which he will use as a laboratory to do so in shanghai. >> you talk about exports.

talk me through the challenge of shifting to export based based.d import what are the challenges to china? >> more than 20 years they were tied into their export oriented economy. i do not think we will be seeing any double-digit road anytime soon. there would have a tough time just getting 10% -- seven percent. >> what you see on this chart? >> the following of exports. one of the concerns also, is a weakness more weakest the -- more recently in manufacturing. the challenge, the new , dealing with pollution and corruption.

not to speak of, the challenges he has with the financials this dem. you and i have spoken a lot about the problems of nonperforming loans at the major state-owned banks in the public-sector or are, and the state owned enterprises. and the shadow banking system. >> those are just problems -- part of the problem about banks drowning in debt. investments in the wrong places. what are the biggest risks facing china's economy? >> the achilles heel is the need to move ahead getting these nonperforming in order. getting some regulation around the shadow banking system. people feel that the shadow banking system is now somewhere between 25% of of which is conservative, and the more normal figure given as one third of the total financial system of china. you do not have that articular

-- articular area under a galatian, and they need to move on quickly. outlookto me about the arts. >> they are tied into politics. the first president after the freeing of the ukraine from the old soviet union, right after the time of gorbachev was a very powerful president. to oneghter is married of the leading oligarchs in the country. i do that as an example because others were tied in with you andovich -- yanukovych, forced it out of the country. even more so than you did in russia, you have these in ukraine. met vladimir putin when he was working in the mayor's office in st. petersburg.

what is he like, and is the international immunity underestimate this man? >> he is a very shrewd operator. he speaks fluent and urban -- germann, and he was ron up by a warmer friend of mine, who was a iberal. he changed the name from leningrad to st. petersburg. he ended up in the kremlin. never underestimate vladimir putin. >> how should ukraine be restructured? against --sh should russia be a part of that restructuring? >> so much of the trade, particularly for the eastern part of the ukraine is with russia. if you talk to the russians, they remind you that the founding of what we think of russia today was kiev.

we have to come in through the international monetary fund, the bank reconstruction development that worked on that out of london and europe, the european investment bank,'s government to government lending. give them support, and they will take positive economic reforms that we are not taking under yanukovych. discuss two hot button topics, it is always great to be with you. >> thank you very much. >> "bottom line continues. ♪

>> facebook's $19 billion pp has broughtatsa more deals in the online chat industry.

bloomberg's middle east correspondent spoke with life persons ceo in tel aviv. >> the world is really changing. things like facebook are acquiring whatsapp, and that is what the heart of the internet is at today. we want to provide a platform to companies coul -- communicate with their come -- customers like that. >> getting more used out of your existing products? >> there is a couple of interesting dynamics. there is a consumer out there that does not know to pick up the phone to get help, they want to chat. there is global markets, we just sent to japan, australia, germany, there is a really unique ability to go mobile with what we are doing.

enterprise customers expanding, getting more of their consumers to interact online, digitally versus acting up a phone. bank, so youe could pick up a few companies like that? >> we are based on more technology acquisitions. coming out on the market, so we are investing in ourselves right now, and executing and bring that but for out of the market -- and bringing that platform out into the market. today we are very focused on execution with our own products. we have this tremendous ability to go out through the market. it is not about one click buying, discounts, and cheap rises, it is creating a new emotional impact of customers -- with customers. i can talk to my friends, and my family, but why has not happened in e-commerce?

that is a place we can really drive. >> coming up, winning an oscar. we will take a look at the financial benefits of academy awards on box office sales, and the salaries of stars. ♪

>> the oscars may be over, but how much those academy awards are really worth has yet to be seen. at mediaing partner tech capital partners joins me now in the studio. welcome back to "bottom line." what did you think of last night's telecast? >> i thought the telecast itself was a little underwhelming. >> why so? , --t was this organized disorganized, hard to follow. they did not tell you what awards were running up -- cvoomh ng up.

half of the presenters were brand-new names to the viewers, there are not that many great stars left. >> "12 years a slave." club -- buyers club, rmb films a better investment? >> they are turning out to be a huge home run for the investors. they cost $80 million to produce, and another $30 million to launch in promotion. winners, dallas buyers club, $5 million, it is going to make its money back, it has already made its money back. it was totally funded by independent investors. >> talk much can winning an oscar add to a film's buying power? >> i think you're going to see a huge increase. fifty percent of

its box office post-oscar. -- even nebraska is going to have a nice boost from the publicity that the oscars gave them. >> sandra bullock, she did not butan oscar last night, what kind of financial deal did she get when she signed on to do "gravity?" thate was the person had to go out and be persuaded. >> why? >> people do not imagine that a 3-d movie with two characters about outer space was ever going to work. she signed on, took almost a zero paycheck about but took a piece of the gross.

so far, that is worth $70 million. making her the highest aid actor in movie history. >> how much did you make in all of 2013? >> she did $50 million on " heat" and her other films. she is really on a roll financially. >> social media the big story coming out of last night's oscars. tweeted the picture that she took with all of those stars, and it crashed the system? >> it crashed the system for about 10 minutes, it beat obama's inaugural tweet selfie. it is representative of what is going on. the oscars as television are a geezer. [laughter] ie that the best self will ever be on twitter. it crashed thet

system, what does it tell us about the power of social media? has 25 millionn followers, there were very few people over 30 watching the broadcast, tens of millions were picking it up on social media. , that is the oldest in oscar history. what do they have to do to get younger people to start washing -- watching and stop tweeting? >> short of streaming it on the net, it is asymptomatic result of the recliner -- decline of network television. >> why are they not going after this fullbore? the audience is there.

>> what is going on? >> social media has not clicked with the advertisers. it is not bringing more than a small amount of television expenditures. television is appointment viewing. you know at any given moment who is watching and senior commercial -- seeing your commercial. when it is streaming, you can see it at your convenience, and it is harder to measure. advertisers need to get on the ball and start getting some hard numbers before internet advertising explodes. >> 33 million total viewers, oscar tv telecast in 10 years since 2004. great to see you. thank you for your time. ,"ay with us, "bottom line

returns in just a moment. ♪

>> get the latest headlines at the top of the hour on bloomberg radio, and streaming on your tablet and that bloomberg.com. that does this for this edition of "bottom line." on the markets is next. is 56 minutes past the hour, which means that bloomberg is on the markets. we are looking at stocks, not as bad as they were earlier in the session. the essence feet -- the s&p is now up. jumping off the lows of the session, it was a pretty rough day, down over one percent. legendary investor warren

annual released its investor letter, giving the market insight into how he is thinking, and looking at returns. i'm joined by in the loop anchor betty liu, as well as our news expert. what's interesting to me is that berkshire hathaway stock not getting crushed as much. >> it was daddy, holding firm. i think investors are following the sentiment around berkshire hathaway and warren buffett after the letter was released. he was talking about asset allocation, being the single biggest defining factor into whether or not investors are going to be rewarded for holding berkshire hathaway shares. be doing aseems to pretty good job. you talked about some of his investments, like nevada energy.

he also talked about heinz, and the partnership with dream -- three g capital, all ways to intelligently allocate that capital. >> it is a huge things that andeholders care about, he spent a lot of his letter talking about ways that berkshire hathaway can -- >> $30 billion, i want to hear about -- i hear he wants to give up $20 billion in cash. tonight, andeep write a lot of insurance contract that can result in big planes. he liked that cash discussion. there are all sorts of risks that can be taken on, that they want that fully -- $20 billion for. at the end of the year because the $20 billion in cash. >> where is the speculation on where the next target maybe -- may be? will it be a self-sustaining one

like insurance? >> tom keene on our radio program afterwards, he has been a work sure how to make shareholder for a long time. given how many targets overseas and trips warren buffett has made, once to china, twice to your, he is not announced any -- any big acquisitions overseas. a lack ofnow if it is interest outside of the u.s. borders, or if you want to stick to this by american theme and stay in the u.s.. there are not a lot of big elephant targets here. >> the thing that does not get mentioned enough here is that it berkshire hathaway does not go out and buy a business to spend a lot of money, they have havetions that opportunities for reinvestment. they spent $11 billion last year just on lance and equipment -- plants and equipment.

>> at some point you're just too big to grow, right? >> you can grow, just not as fast as before. >> we're talking about a company that just had a tremendous compounding over the years. tremendous compounding over the years. aing that when you are company with a market value of 280 billion dollars is really hard. >> we appreciate it. we will be on the markets again in 30 minutes. "street smart" is up next. >> hello, everyone. . am trish regan tension in ukraine mounts. stock sinking on worries that there may be a larger military conflict. we have more on that story and in just a moment. you're watching the most important hour of the session. matt miller and i are scouring the markets for your last trade of the day and your