wewelcome to "lunch money," tied together the best stories, interviews, and business news. i am matt miller in for adam johnson. googler in chief, larry page is tremendously upset and super excited all at the same time. sports, is the ability, who will pay? the stadium business comes to spring training. the two sides of a herbalife story. carl icahn gets more seats, bill ackman about to break even. man who isthe

building a $1 billion empire out of vice media. , a fender bender to find out how the classic guitars are made by hand right here in america. let's kick it off with what everyone is talking about today. the search for malaysian air flight 370. it has been just over two weeks since the plane disappeared after taking off from kuala lumpur. multiple countries have searched the waters of the southeast by boat, plane, and by satellite. investigators have analyzed mountains of data. at most, there has been only speculation as to what happened. today, we heard from the malaysian prime minister on the latest analysis of data from a british satellite provider. here it is, in the raw. , weased on the new analysis

flewconcluded that mh370 corridor anduthern that its last position was in the middle of the indian ocean, west of perth. is a remote location. possible landing place. it is therefore with deep sadness and regret that i must according toat mh370ew data, flight ended in the southern indian

ocean. malaysian prime minister speaking earlier today on the search for the missing passenger jet. while he gave no concrete answers. theave this -- he declared search will be married to the southern indian ocean, some debris was spotted by chinese and australian search kiecrews. by objects could be received tomorrow morning at the earliest. the prime minister will hold another news conference tomorrow. the other story is the ongoing chess match between russia and ukraine. they, president obama and netherlands with leaders from europe, china, japan and other countries. he spoke earlier at a news conference with his dutch counterpart. >> europe and america are united in our support of the ukrainian government and the ukrainian people. coste united in imposing a

on russia for its actions so far. oute minister recep pointed ringthe sanctions would rin consequences to the russian economy. we will continue to coordinate with the netherlands and our european partners as we go forward. the big -- question now is rush's continued aggression in crimea. russian military forces stormed multiple ukrainian military bases today in crimea. >> we are very much concerned the climate of russian troops on our eastern border. the ukrainian government is trying to use all their peaceful means and of pneumatic means to stop russia.

but people are also ready to defend their homeland. >> that is what lawmakers are worried about as well. everything from fuel to tires to sleeping bags. ain't ukraine was inastated by -- this army ukraine was devastated by nyukovych. let's help the ukrainian army get on its feet as a self-defense force. >> even with all this discussion about what is going on in russia and crimea and ukraine, the markets have not been hurt at all. the question is why? i would think, this would be negative for risk assets. one reason is because it looks like russia really has the leverage. we are not going to put boots on

the ground in ukraine, they are not a member of nato. it gets more serious if russia moves into a confrontation with nato, then it is an enormous impact. atukraine will dominic talks the group of seven industrialized nations meeting today in the hague. the u.s., canada, france, germany, italy, japan, and britain. at the beginning of the month, the group of eight were planning their meeting in sochi. have beenthat meeting suspended on the number has been trimmed by one. german chancellor angela merkel says that russia is still a member of a larger group. what makes google cofounder and ceo very excited about the future? believe it or not, it involves balloons. we will hear from him next. sports stadiums worth the millions and hundreds of millions, even billions of

dollars dished out to pay with them? we had to fort myers, florida, where the red sox are finishing their spring training, coming up in sports. teen warriors topped the muppets at the box office. "divergent" took in $56 million latestet sales, the feature from lions gate targeting a young audience. wanted" rangm most up $16 million in second place. ♪

months sincen nine edward snowden made public the nsa's surveillance packages. released a statement condemning nsa attacks on its network. friday, tech giants like zuckerberg and

former ceo of google eric schmidt wemet with president obama. google cofounder and ceo weighed in, sitting down with charlie rose for a rare interview in vancouver. >> it is disappointing that the allrnment secretly did this stuff and do not tell us. i do not think we can have a democracy if we are trying to protect ourselves from the government for stuff we never had a conversation about. --on't mean we have to know about a terrorist attack they are worrying about protecting us from, but we have to know what kind of surveillance the government is going to do and how and why. we have not had that conversation. has done aent tremendous disservice to itself by doing all that in. lex never coming to google to ask for anything.

>> not google, but the public. we need to have a debate about that. where we cannot have a functioning democracy. it is not possible. google is in the position of protecting our users from the government doing secure things that nobody knows about. then there is a privacy side of it. >> the privacy side -- the world is changing. carry your phone and it knows where you are. so much more information about you. that is an important thing and it makes sense why people are asking difficult questions. we spent a lot of time thinking about this and what the issues are. i am a little bit -- i think the main thing we need to do is provide people a choice. show them what data has been collected. the search history, location data, we are excited about

incognito mode in chrome. giving people more choice and more awareness of what is going on. all right. something else larry page is passionate about as artificial intelligence. it used to be the stuff of science fiction, but the 40-year-old billionaire wants to make it more of a reality. >> this is one of the most exciting things i have seen in a long time. the guys who started this , he has a neuroscience and computer science background. he went back to school to get his phd and study the brain. we are seeing a lot of exciting work going on that crosses computer science and neuroscience in terms of really understanding what it takes to make something smart. and do really interesting things. >> where is the level of it now and how fast do you think we are moving? >> this is kind of the

state-of-the-art right now. understanding cats on u2, proving voice-recognition. we use a lot of machine learning to improve things incrementally. reallyxamples are exciting. it is one program that can do a lot of different things. >> we have got the image of a cat. this is how machines look to cats. there it is. can you see the cat designed and seen by machines? >> this is learned from watching youtube. there is no training or notion of a cat, the concept of a cat is something you would understand and now that the machines can understand. >> weird. one google project that has taken off, literally, the balloon project. the mission is to bring internet connectivity to everyone. andocusing on access

talking about the future. we recently released the balloon project. it sounds totally crazy. i can show the video here. it actually, two out of three people in the world do not have good internet. we think this can really help people. >> is a balloon. >> you get access to the internet. >> why does it give you access to the internet? you had to figure out how to make balloons possible. they did not have to be tethered. >> this is a good example of innovation. we have been thinking about this idea for five years before we started working on it. it is really how do we get axis , cheaply.igh normally you have to use satellites and it takes a long time to watch them. you saw how easy it is to launch a balloon and get it up. using the power of the internet,

i did a search and found that 30 years or 40 years ago, someone had put a balloon up and it went around the earth multiple times. i thought why can't we do that today? that is kind of how this -- >> are you at the mercy of the wind? out, we didns weather simulations. if you control the attitude of the balloons, which you can do by pumping air into them, you can control roughly where they go. i think we can build a worldwide mesh that can cover the whole planet. >> that is freaking cool. full interview with larry page tonight i :00 and 10:00 p.m. eastern. only right here on bloomberg. still ahead on "lunch money," a conversation with the brain behind vice media. thethe news outlet won backing of rupert murdoch.

the pros and cons of building sports stadiums. we hear both sides of the argument, coming up in sports. ♪

-- of the stadium debate. if you build it, will they come? stadiums can cost taxpayers millions of dollars or billions of dollars, like the jetblue part in florida, where the red sox have their spring training. some argue it is worth the business and it attracts. phil from the university of south florida says it is not. he spoke with mike mckee. >> we have never found that

spring training has to do with the amount of spending that goes on in any location. we see teams moving around and you can look at a county and see whether or not the team comes to the county, do their sales go up. the team leaves the county, do their sales go down? we have never found real evidence. even if the claims of all these people are true, the amount of tax revenue generated by the spending that the state claims is not enough to cover the operation and maintenance costs of a stadium. >> do we go from here to additional sports palaces? are the american taxpayers starting to get to the limit of what they will pay for these things. >> i noticed an interesting trend in miami and dade county, they build a new stadium for the baseball team, not necessarily the most favorite team. they built the marlins a baseball stadium. the marlins immediately cut their spending on players to the bone. the team was abysmal this year.

the stadium has mired the city and debt. they turned around and asked for funds to improve dolphins stadium and the taxpayers and legislatures said no. maybe the trend is changing. >> mike spoke with the lee gavey organization that the red sox the subsidy for the 72 million dollar stadium, he says it was an investment and for his own. unlike major league baseball this ises in hometowns, a tour as a venue. it draws hundreds of thousand people from boston. we also manage and operate the minnesota twins facility and it draws many people from the upper midwest. when spring training is over, our office uses the facilities to program 200 days of amateur sports events. paid for the construction, you have got to

pay for the operation. do you make a profit? >> no, we do not. we spend about $1.5 million per facility on maintaining the facilities. at the same time, that one $.5 million is generating around 50 million dollars of economic impact for our community through these amateur sports events of the rest of the year. >> when this is all paid for, you will have on this paid half a billion dollars for this, couldn't you have done something else for the community with that kind of money? with bed taxlt dollars, which are restricted by state statute to only certain things you can do. there are people who think that maybe we could have used the dollars to two additional beach and shoreline nourishment projects or we could have spent him,marketing on tour is international tour efforts. it was a policy decision and we have been in the business of

spring training since the early 1900s. our elected officials at the time thought that using 20% of our bed tax to host spring training was important. the minnesota twins also play in fort myers. the president of the team says it is good for lee county and for the fans. roihere is a significant for lee county when you consider that 60% of our fans, game in and game out, are coming from well outside of the county. they are spending money on hotel rooms, restaurants, and at local attractions. it is a significant driver of economic development. it is a win-win. >> the red sox got their new stadium a couple years ago. can get upgrades here. did the twins ever putting money into it as well? your own equity? >> we are putting money into it.

we have about $8 million that will be invested by the team, not to mention that we will be putting dollars and every single year in terms of people buying homes, players training here year-round. there is an economic benefit to the county beyond spring training. >> what do you get for the money and the stadium? x there is dollars in player development, the training and conditioning elements. the dollars are going into fan amenities. expectations have changed. they want a wider concourse and better concessions. they want the opportunity to have technology and wi-fi, things of that nature. a lot of dollars are going into enhancing the experience for baseball fans. it gives us an advantage, we are doubling down and investing on that. we are building a player development academy as part of this. we think that will be a game changer as players involved.

we do believe that spring training, and specifically a partnership with the community in southwest florida, is a difference maker for the twins. the new york yankees stadium in the bronx is the most expensive major league. 1.5 billion dollars, taxpayers put in half of that. the franchise does not pay sales or property taxes in the bronx. pastime,ll-american rock 'n roll. you cannot have rock 'n roll without guitars. we will show you how the offender is made. [guitar music plays] >> 26 minutes after the hour, bloomberg is "on the markets," i am olivia sterns. stocks are falling for a second

.7%.the s&p off by about a lot of feeling on the nasdaq being weighed down by biotech stocks. back "on the markets" in 30 minutes. ♪

this is "lunch money," on bloomberg television. streaming live on bloomberg.com, also on your tablet and cell phone. i am matt miller. today's moving picture, the video is the story. a mudslide in washington has killed eight people and a dozen more are missing. it occurred in a rural area north of seattle. it destroyed at least 30 homes and started when a large chunk hillside split away. the millard is 15 feet deep and has slowed rescue efforts.

channel inping houston remains closed after a weekend accident, nearly 170 thousand gallons of oil spilled after a barge collided with another vessel. the channel connects galveston and the gulf of mexico and handles as many as 80 ships a day. no timetable for when it will reopen. subway train jumped the tracks and ran up an escalator at o'hare airport. the early morning accident injured 30 people. the train was traveling faster than normal when it entered the station, crossed the platform, and skilled escalator. authorities are questioning the operator and reviewing footage to try to determine the cause of the accident. no fatalities reported. isht activists, carl icahn at it again. >> we need to bring you up to speed in the title over herbal

life, the nutritional supplement maker has agreed to give carl icahn three more representatives on its board. step closer to gaining control over this company and raising the stakes one more time in the standoff with bill ackman. "herbalife," it because he is canadian. bill ackman is close to breaking even on his bet against hls. bet against herbalife in may 2012. job, as dan loeb and carl icahn came to herbalife's rescue, the stock battle back. the federal government opened an investigation into herbalife and the stock has fallen. the news from carl icahn has

sent the stock back up. you were over herbal life goes on. dwayne stanford explained it to "market makers." >> these board members all come enterprises. to our executives with the company and the other is a n enterprises.cah he is beefing up his visions 5 on the herbalife board. this comes as bill ackman has been able to get this investigation he has called for, the ftc now looking at the company. the stakes have been raised and we are going to be in for quite a battle. you were reporting that after a year of losses on the short bet against herbalife. might be near break even, no longer losing money. >> that is right. based on our catchy lay-ins, he

is somewhere near breakeven. a lot of that coming in the last week as the ftc says they are asking for more questions of the company. it creates uncertainty among investors. a considerable amount of scrambling as people tried to figure out what is going to happen at the end of this investigation. you could have some sort of finding along the lines of what bill ackman has asked for in terms of it being an illegal pyramid scheme, or it could be a slap on the rest. perhaps they come back and there is no action at all. that is what people are waiting for. be aboutrtain can we ackman's financial position? you put about $1 billion on a short position against herbalife to start off with in 2012. hard to believe with so much time has transpired. then he restructured his trade

to limit his downside, presumably that cost him something. at what point, if ever, will we be able to know where bill open stance? stands?ere bill ackman >> the picture is more cloudy from when it was a simple short bet, the options make it very difficult. we have done some analysis looking at some of the average prices in the period he was buying the stock. he started buying may 1 of 2012. this was while david einhorn had asked questions on the conference call that sent the stock down. he started buying dan and it was december of that same year that bill ackman decided to act as his own catalyst, as he said, to bring his allegations to light. the company toed about $1 billion. later, as the stock increased,

he did add some options. right now is that he is very close to breakeven. >> by the way, erik drinks herbal tea. how it behind device, went from punk culture media outlet to major media player. how you can own a piece of rock 'n roll history. a collection of guitars, including eric clapton's gibson, are going on the block. no luck for jimmy kimmel, he tried to get an answer from hillary clinton on whether she is running for president in 2016. she would not say yes or no, but we all know the answer. >> will chelsey get her old room back or will you convert that into a home gym? [laughter] >> you are throwing me under the bus. what is this? didhis is what my parents

to my veteran, i am staying with them in arizona. ♪

media.g story in apple in talks with comcast about teaming up on an internet-based television service that would get special treatment to bypass online congestion. that is according to the wall street journal. as bloomberg reported months ago, apple had been in talks with time warner cable on creating a streaming products before its merger with comcast. brendan greeley and jeff hasl yzlett talks about what it means for the industry on "surveillance." >> it did not have to cut any deals with comcast or time warner. once netflix is big enough that i can cut deals and pay for this, i do not know how the netflix -- helen next netflix is

going to happen. they have a huge barrier to entry. >> this is a barrier to entry to pick up on this. horse, it istrojan a smart move on apple's part. they are trying to move their ecosystem. when you are watching television, when you have these over-the-top televisions where shows we might develop digitally, they are online. i will have to go through through itunes or the app world, go for apple to deliver it. >> all right. v from msg getting more popular by the week, a new player making an offer to buy the channel for $350 million in cash, surpassing bids from j. lo and p. diddy. have notny says they

lined up financing yet, but they have met with them hungry, blackstone, and disney. another company giving traditional tv a run for its money is vice media. jon erlichman sat down with its fearless leader asking him if a cable network is in the cards for vice. i would have said no up until recently, but we have been selling so much tv around the world. whenever we look at something, we were doing so many events in london that we bought a pub and events in the pub and that came our most successful venture. we are creating so much ip now that it is always smart to on your own platform if you can't. we are looking at various opportunities. there is such a destructive it in a media right now. we are throwing a lot of cash and we can look at buying distressed media assets and seeing if we cannot turn them around.

are a profitable company. what does that mean? does that mean you are a wildly profitable company? we are wildly do, profitable. we have been profitable since day one because we came up in a recession. we believe you have to make profit or you do not exist. we have been doubling our top line pretty much every year we have been in existence. that gets harder because there is a lot more zeros in that now. our margins have gone up. as we are now licensing to mobile, online, and tv and film, our margins are going up. 34%re running at around margins and trying to get about 40% or 44% next year. the holy girl is 50% for an 50%ne -- the holy grail of for an online company would be huge. >> catch the interview with shane smith on "bloomberg west"

at 1:00 p.m., 6:00 p.m., at 11:00 p.m. eastern. those times are different in the west. here is something shane smith can buy with all his money. a piece of rock 'n roll history. some of the rarest guitars, vintage guitars going up for auction. we are not stopping there. we take you inside the california factory where the legendary stratocaster is made. all that is coming up. ♪

>> ever wanted to own a piece of rock 'n roll history? here's your chance. starting april 2, more than 250 vintage guitars are being auctioned off at eight today is that in new york city. auction house's president stopped by "in the loop" to preview some of the items. a finely tunedth

ear, every guitar that is handmade, these are not electric, mass-produced instruments, handmade instruments, they have different sounds. some are higher and they are very discernible to the aficionado. they are gems. ofwhat makes an aficionado guitars? are these people that play them? them, who areplay passionate about them. we have sold the guitars of jerry garcia for about $1 million apiece to people who grew up with jerry and thought of him as almost a godlike figure. to have something he treasured was enormous. wentu mentioned that they for one million dollars each. there is nostalgia and a personal connection for the people bidding. this collection go for? what are you anticipating?

>> there are instruments in this collection, the finest collection ever to come to auction, a range from 7000 to a high of what we expect to be a seven-figure amount. garcia is an actual god. the lecture guitar maker fender has been in business since 1946. we take a look at where rock 'n ,oll staple, the stratocaster where those are made. [guitar music] >> i started playing guitar when i was 12 or 13. der is the worlds largest producer of guitars and amplifiers. from the 1950's and the birth of rock 'n roll to today, artists like john mayer, jimi hendrix, they have all held the fender. >> everything is so classic about it.

first guitar triggers all these memories. it is a fender guitar. >> this building produces the quintessential fender products. interesting, there are not a lot of industries where globally, an american made product, is the most premier and prestigious, aspirational product. fender guitars are. people will save for years to be able to afford a usa made fender guitar. that is no question sometimes running a business in california is challenging. is a lot of regulatory issues. but you know what, we have so much pride in our heritage and in our roots here. we have always been a southern california company and we are not going anywhere soon.

the two main components of the guitar are the body and the neck. each of those start off as raw pieces of wood. they go through a process. this is a spread of ash from the southeastern u.s. wese are the samples that used to make sure that we have the shape of a neck exactly right. you might have heard of him a thousandthis of an inch off, they can tell. >> it gives me chills to see the machines that have been used for years. >> it goes through paint, a curing process. this is where it all comes together. now we start addressing the frets, putting the electronics in.

then it goes over and is packaged to go out to the next rock star. [guitar music] >> we're going to stick with rock 'n roll for our mystery meat. producerinterview with mark hudson, here is tom keene rocking out. >> you ready? >> ♪ again and again 1, 2, 3 listen on the edge living on the edge ♪ >> isn't that great? 4 ♪ 1, 2, 3,

♪

past the hour, bloomberg is "on the markets." i am olivia sterns, halfway through the trading day. let's get you caught up. also made benchmark indexes in the red. the nasdaq being dragged down by a selloff in biotech stocks.

highlighting a couple individual movers for you. to nominatereed three people proposed by activist investor carl icahn to its board. carl icahn and related companies owed nearly 70% of herbalife stock. they will have 5 of 13 board members if they are approved. shares of pandora following the most since february. this comes on reports of competition from apple, reportedly getting ready to launch an itunes app for android that will carry npr. from stocks to commodities, let's look at precious metals. monthium surging to a 31 high on supply concerns. brush is the top source of the metal -- russia is the top source of the metal, concerns that sanctions will reduce the supply. let's look at gold, trading lower today, close to a four-week low.

selling off last week as the fed signaled higher interest rates. a great start for the year for gold, up 21% into last week. it seems to have turned around after the fed meeting. as the rally petered out? year, beginning of the people were worried about the weather and they were not sure whether the economic data was actually a slowdown or related to the weather. there was also russia and the crisis in central america. there were a lot of safe haven bids coming into gold. the fed signaled higher interest rates. nobody really thought about interest rates, you do not get higher interest rates. that took people away from gold because higher interest rates are not good for gold. >> in an environment of rising rates, who wants to bet on gold?

where does it go from here? >> the forecasters who predicted gold would have a rout, they are saying the fall in gold was because of the weather and was only temporary. some of them are saying gold could even go down to 1000. >> it is trading currently at 1340. overnight we have more economic data out of china, more disappointing news about the manufacturing sector and the health of the chinese economy. aboutch is the concern the chinese economy weighing on the gold market? you safedown can get haven demand, but china is the biggest consumer of gold. if the economy is not doing well, there will not be money to buy gold. they became the largest consumer last year.

we heard data from the china gold association that they younded a 17% -- that tells that if it falls the first quarter because prices went higher, we could see that in the chinese demand. >> thank you so much for joining us on gold, trading at about 1311 per ounce. "on the markets" again in 30 minutes. "bloomberg west" is next. ♪ ..

♪ >> live from pier 3 in san francisco, welcome to "bloomberg west." i am emily chang. technology and data analysis has helped malaysia determine that the missing malaysian airlines flight crashed into the southern indian ocean. we are taking a look at how tech help crack the case. larry page talks about everything from robots to self driving