>> welcome to "lunch money" where we tied together the best stories and business news. take a look at the menu -- in motors, make it 2.6 million -- gm widening its recall. jeep -- the chief dignity for near full in washington. talk about an earful -- chris christie, the governor of new jersey says the facts speak for themselves. in turkey, the prime minister may have a beef with social media, but can still win the elections. one of the largest makers of faucets, toilets and seeing is right at home in wisconsin.

in sports, amari means business. we will talk about his ambitions off the court. we will talk about -- we will kick it off with what everyone is talking about. >> the stock market is rigged. the most iconic market in global capitalism is rigged by whom? by a combination of stock exchanges, the big wall street banks and high-frequency traders. >> that was michael lewis, nonfiction author on "60 minutes" last night. you've probably heard about his books as of experience as a bond trader and baseball. most recently, "the big short" about the housing and credit bubbles of the 2000. now he has a new book called "flash boys -- a wall street revolt." it's about flash trading in the high-speed algorithmic

strategies. here he is once again. >> insiders are able to move faster than you, able to see your order and play it against other orders and ways you don't understand. they are able to front run your order. >> what you mean front run? >> they are able to identify your desire to buy shares in microsoft and buy them in front of you and sell them back to you at a higher price. it all happens in infinitesimally small periods of time. the speed advantage the faster traders have is milliseconds. fractions of milliseconds. but it is enough for them to identify what you want to do and do it before you do it at your expense will stop -- at your expense. >> he's not alone in his analysis. we decided to ask some people what they thought of his comments, including this man.

>> high-frequency trading of securities is good. produces liquidity. frontrunning the market is bad. >> that was the new york attorney general. two weeks ago he said he's looking into the conduct of high-frequency traders and the stock exchanges that work with them. he spoke with "market makers" crew this morning. >> the game has gotten very complicated. the sec is looking into this and commissioner spoke up pretty forcefully about this. they need to make moves to change the regulatory structure. we have a system with more than 60 private and public exchanges interlinked and there are cracks in the system. high-frequency traders in this race for speed try to use the milliseconds they have as an advantage to front run markets and take advantage of the cracks. the sec has to look at some new regulation in my view, but there are other things that could be done like putting speed bumps in, and there are a variety of ways to this, just to slow down the process and take away the arms race.

>> but it was the sec that created reg mms and this system that has the cracks in it. when i look back at the way specialists operated, they knew so much information and could control bid ask and now it seems it's more fair than it was 15 years ago. >> i don't think so. i do think it is important to distinguish between high-frequency trading, which is a good thing. extra liquidity presses the bid ask range and are those folks trying to take advantage of things to front run the system. if you can get information that someone is dumping, i think he's uses microsoft as an example, and you have the ability to know that a few seconds before people can execute the trade, just milliseconds. the other piece we have to look at is the race for speed is inherently dangerous.

that leads people to take more and more chances to take advantage and can lead to destabilization. >> you describe it as an arms race. is it by definition dangerous? i ask this question only because in every other industry in america, we celebrate technological advance and celebrate the use of technology to solve problems and build better mousetraps, except in the equity capital markets. lewis says from his perspective, he's now the attorney general, but he says from his perspective it is legal. >> we are not prejudging the situation, but your point on regulation is a little bit off. we tend to be market centric in new york. we have speed limits on airbags and celebrate technology. we have systems so you can

cancel your credit card if it is stolen. there are ways to have checks and balances. what's being proposed is in the way of speed bumps. it's a new conversation and i support this idea of frequent batch auctions. you have all the trades up for one second and then it allocated by price, not you got it a few milliseconds before the others. this exchange was featured and they have their own way of putting a speed bump. this conversation is just beginning to prevent frontrunning and to ensure markets are safe. >> while the new york attorney general looks for answers, the debate is going on and we had our own on "surveillance" with the ceo of high-frequency trader white's speed and a former morgan stanley agent chairman. >> i don't think the market is rigged. i do think you have an issue with executable

orders and phantom orders that he does bring up in the book. that is a problem because you go to execute an order and you think you can execute and it's not there anymore. >> who gets the demised in that situation? >> we're pointing a lot of fingers and saying retail guys are getting victimized. but they are sending in order to add high-frequency trading firm or using a strategy behind it. they are contacted by -- >> this is not about the little guy? who is it about? michael lewis wants to sell a book. he's on "60 minutes" saying it's about the little guy. is he wrong? >> it's about lock orders. why would you put the block order up when you could have a

table order? >> this is just pure journalistic sensationalism. flash traders are bit players compared to the biggest raider of all -- biggest raider of all which is the fed. the fact he saying the market is rigged sounds like a computer and back room conniving to squeeze this guy or that guy. >> this is a good debate. michael lewis is going to make an appearance here on bloomberg. he will be on "market makers" on wednesday and then on "surveillance" on thursday, right here on bloomberg television. from wall street to washington, gm's new ceo is set to testify before congress. did the company reject a plan to install new ignition switches -- and interview with the star super -- star basketball player. at the box office this weekend "noah" grabbing the number one spot.

the biblical epic at the starring russell crowe rang up $44 million. >> man corrupts this world. >> a great flood is coming. ♪

>> general motors recalling 2.9 million cars because of faulty ignition switches. newly released documents show the company decided not to fix the problem all the way back to 2005. the reason was supposedly it was too expensive. our resident car guru matt miller weighed in on what this means for g.m.'s bottom line. >> g.m. kicked it off with the corvair and their battle with ralph nader. that started mitzvah. then they have a problem with side saddle tanks in their trucks causing explosions which is always unsafe. now this. it's not a new position. >> as a company, it's not a new position.

>> for mary barra, it is interesting. we tend to think of general motors as this company that has a reputation for putting cost-cutting before safety and always fights against safety probes in washington with rick wagner and previous heels, so it's a new company. it went through the bankruptcy organization and was run by washington, d.c. for a while. now coming out the other side, it's new and the way mary has responded is different than gmc owners responded in the past. she was very contrite and hired an outside investigator to look into these things. she's put a vice president in charge of these issues. >> she has apologized, and she's also been forthcoming with information that has not been flattering to general motors. >> which would not have been the case in the past. she's taken the bull by the horns in a different way and

maybe general motors is going to show their colors in a real new companies out -- new company now than they have a pass. -- in the past. they can't be good for their sales numbers because when consumers hear this, they don't want to buy the product. >> bloomberg will have live coverage of the testimony with the q and a that will be with the house energy and commerce subcommittee tomorrow right here live on bloomberg television. another automaker facing challenges is tesla. the general manager for china has just resigned. our auto editor, jamie butters, talked about how his could complement -- could complicate elon musk's plans for expansions overseas. >> it is certainly a setback. he has lost people. along the way, building the company, they've had departments in serial. it's not general motors where

they have a massive organizations. right now is when they need good salespeople. to position the brand and speak to the customers -- it is a setback. i don't know chang and i can't speak to how gifted he is, but this is not the kind of thing he wants when he trying to hit the ground running in china. >> in the u.s., tesla just inked a deal with andrew cuomo. it's going to have to limit its direct sales approach. >> from now on, everyone has to use dealers. it does not create a precedent, more importantly for a chinese and indian brand, to bypass dealers altogether. at the same time, it provides some competition to new jersey. when you put up the map and as long as the states are a patchwork. when you can drive to a state

for another car, a gives tesla much more strength to negotiate with new jersey to encourage new jersey's legislature or regulars to allow them to do business or lose it to neighboring states. >> new jersey has already delayed the date from april 1 to april 15, the effective date of the band. is there some negotiation going on in the end it might be able to sell? >> there's a lot of action going on in the legislature as well with the administration. these are administration appointees mostly on the board. it seems like it would be hard for the board to resource -- reverse itself, but things happen, don't they? >> yes, they do. let's talk about fiat were the ceo claims deliveries will rise as much as 55% annually thanks to the finalized merger with chrysler. the announcement was made today. fiat bought full control of

chrysler in january. the ceo is to combine the two manufacturers in a cut -- into a company that will be registered in the netherlands though its primary stock listing will be here in new york. things are looking up at bmw. they're celebrating their 25th anniversary of manufacturing in america by announcing a big expansion at its south carolina plant. >> spartanburg has a special place in the bmw family. for this reason, i'm pleased to announce that between 2014 and 2016, we are going to invest $1 billion in this facility. spartanburg will become the largest plant in our production network and a new milestone in the history of the bmw group. >> that means bmw plans to turn out 450,000 vehicles a year by

2016 down there in spartanburg. the company will have to hire 800 additional workers, bringing total employment there to 8800 people will stop i like it. putting americans back to work. bmw is not the only ones feeling home in the usa. we will take you inside kohler, the brand that has been here for 140 years. governor christie speaks out for the first time since the release of his controversial reports. we have the details coming up. and a show of force shows unity on the coast of south korea. those are some joint exercises with south korea earlier today. also earlier today, south and north korea firing artillery shells into each other's waters. the north calls the drills a rehearsal for invasion. washington and seoul insist the exercises are not designed to react to any clinical situation. here are more of those drills in the raw. ♪

>> governor chris christie faced reporters on friday in his first appearance since the bridge gate scandal. as usual, he was his old charming self. >> the premise of the question is so infirm that i'm not answering it. it's amusing to me when you guys write stories about what you think you are entitled to.

what i think you are entitled to is the answers when i get them. >> the premise of your question is so riddled with inaccuracies and it's hard to respond. i'm up here trying to carefully answer your questions and i don't know if you can't take notes or you're not listening, love for you to characterize my last answer as i didn't want to ask because i didn't want to know is so awful. it is beneath the job you hold. >> that's mr. christie. report commissioned by christie and paid for by new jersey taxpayers to the tune of a million dollars, by the way, was the result of 70 interviews and sifting through 250,000 documents. >> it's an exhausting report that follows the mandate i set out when we reach -- when we commissioned the review. one thing was clear from the beginning. i told him to find the truth, no matter where it led and turn over every rock they're able to get to to get to the bottom of what happened and let me know

what the truth was. >> the truth, the whole truth, and nothing but the truth. according to the report, it was all bridget kelly's fault. she is christie's former deputy chief of staff. the report characterize her as emotional and weepy. the report also blamed port authority's david wild statement did not characterize him as being emotional or weepy. the report suggested kelly's poor decision was because her alleged boyfriend, also a christie staffer, just broken up with her. kelly and stephanie became personally involved. -- it is important to note none of those three were actually interviewed for those -- for this report.

neither kelly, wildstein or kelly's alleged boyfriend. if the report sounds gender biased to you, you are not the only one. kelly's lawyer said -- a reporter at the press conference asked governor christie about he thought the way the report treated kelly. >> i think the report laid out the facts as the investigators found them. however everybody wants to interpret those is up to your particular interpretation. >> christie's offensive against kelly may not be the best strategy. her lawyer has said if given certain legal protections by the u.s. attorney, kelly will cooperate with his investigation. her testimony can either corroborate christie's version or david wildstein's. it could be critical to

identifying competing versions. they -- yesterday, mr. christie flew to las vegas to woo sheldon adelson. he made a gaffe and described the west bank as occupied territories. the israeli government and mr. ailsa and would not consider those regions to be occupied. christie apologized and adelson accepted. nothing like a little bridge gate to give you foot and mouth disease. next, we're going to turkey and its ban on social media. ♪

>> this is "lunch money" on bloomberg television, also streaming live on your tablet and smart phone. i'm adam johnson. today's moving pictures now, where the video is the story. u.s. secretary of state john kerry says russia has to pull its troops back from the ukraine border if progress is to be made. he met with his russian counterpart yesterday who stressed the u.s. position on ukraine. >> in a frank conversation this evening with the prime minister, i made clear the united states still considers the russian actions to be illegal and illegitimate and russians

actions over the past several weeks have placed it at odds, obviously, with the rule of law in the international community and we still believe, on the wrong side of history. >> both men agreed a solution was essential to de-escalate the crisis in ukraine. additional meetings between the two have been planned. antigovernment protesters battled police in the streets of venezuela. demonstrators set fires and through molotov cocktails at security forces who responded with tear grass -- with tear gas. violence has been raging in the country for more than a month. two more people killed, bringing the death toll from the and rest 233 people. two spanish journalists held for more than six months in syria have been reunited with their

they were kidnapped by islamist radicals well covering the civil war in syria. they arrived at a military airport imagery and to meet their families. circumstances surrounding their release are still clear. -- still unclear. turkey's prime minister is celebrating -- his party won the meet its bull elections, but with only 46% of the vote. he's been powerful more than a decade and told thousands of supporters that the time has come to weed out traitors. i wonder if that's the other 54% who did not vote for him. elections took place after a delusion of recordings flooded the internet accusing him of corruption. understand when you don't like internet leaks, and you name is erdogan -- he vowed to illuminate twitter, youtube and facebook. >> twitter doesn't have much to do with the price of fish.

it has dominated discussions about these elections, especially since it was blocked a week earlier. >> i don't think this was a good move as people were communicating with each other. it was not a good thing to do. >> he did the best thing, not just for him but for other people as well. he's protecting their rights. >> by blocking twitter and youtube, he managed to deepen the divide between his supporters and opponents. >> the people who immensely dislike him are the ones who are outraged and affected by this ban. the rest, his base, are so mesmerized by his persona that they are ready to do anything he wants to do. >> this time around, he just wanted their vote. and there were corruption allegations reportedly implementing him and his -- implicating him and his family.

these elections came down to who voters trusted more. for those keeping the faith with footer and youtube, what happens next could be equally epic. >> elections, corruption cases, it will probably be a move after the elections to criminalize usage. otherwise, technically, it cannot be stopped. >> the government could unblock twitter in line with court rulings, but he's not a man known for backing down. >> there were hints after last night's results that he might seek the presidency. the elections will be held in august. he has promised to serve the nation no matter what his position. next on "lunch money" -- made in america. we'll take you inside kohler, a household name that has been

there 104 years. and another american success story -- we will tell you what he is looking to tackle, coming up next. talk about tackling -- the grass is always greener for house speaker john boehner. he posted this on instagram on friday. >> i love green grass. ♪

>> this is "lunch money" on bloomberg television, also streaming on your tablet and smart phone. i'm adam johnson. our bloomberg series "made in america" looks at global companies choosing to manufacture here in the good old u.s. of a. today, we will go inside kohler. you probably know the name from washing your hands are doing the dishes. they're one of the largest producers of every household

item having to do with water. kohler is made in wisconsin and it has been made right there since an austrian industrialist founded the business in 1873. the kohler family founded a community in 2012 and it was called kohler, wisconsin. history has shown kohler is going nowhere. >> we have a simple mission, and that is to improve the level of gracious living for anyone and everyone who comes in contact with our product. i have a son who is president of this company. he thinks i'm getting too old. >> our company has a long history of pride for american-made products. the family started the business

here and these products are made here and will continue to be made here. >> the kohler family is keeping it here because the work ethic has been here for 150 years. when it says made in usa, when it says made in wisconsin that says something. you know you are getting the best. >> our biggest market is in the united states and they are served primarily by the factories in the united states. we import very little. all the plants we have elsewhere make for the regions in which they are located. >> this is the original kohler pottery built in 1927. what we do here is manufacture everything here from toilets and urinals to kitchen sinks. in this facility, we make about 100 different products every day, 30 different colors, for a total of about 20,000 different sku's at any given time.

porcelain is made from different clays coming from the kentucky and tennessee area. the products goes to these dryers and then we apply the glaze to it. the glaze gives it the color and the smooth, shiny, glossy surface. after the piece get sprayed, it's ready to go into the kiln right away. the kiln is basically a 100 yard tunnel and in the center of that tunnel comes in at 2250 degrees. after it goes through the kiln, the porcelain is a solid piece with no air in it,is or anything. over the past 20 years, we've invested a lot in this facility. brand-new dryer technologies him a brand-new kiln, a lot of spray robots have been installed.

>> we are refurbishing this and it's -- the best pottery, we could compete with virtually anyone else in the world. >> competition is always out there, even for toms shoes. they donate a pair for every one bought. now they are branching out with coffee. the founder and ceo joined trish regan last week. >> this is an entirely new business for us. when we looked at how he wanted to expand our one-for-one model, we are looked at -- we look at countries we are heavily invested from an infrastructure standpoint. we've been giving shoes away at places like rwanda, malawi, guatemala and peru for years. the areas you can have the most economic impact is supporting coffee farmers by trading

directly with them in these countries where we are already working. then the ability to sell the coffee here and invest in water systems here makes for a good one-for-one model. >> it's a commodity like everything else and we've seen coffee spices -- coffee prices spike. how are you going to price, how are you pricing this giving -- given what you've got to pay on the ground? >> when you see coffee prices spiking and the impact it's having on your superpremium bean and we are charging a rhenium price, we are going after market they call the third wave of coffee. it's like an intelligent, uptown, blue bottle. >> how are your margins on something like that? given you've got to pay more and you've got to provide these countries with clean water. >> the margins are much slimmer

on the wholesale level. we have a contract with whole foods. the margins are better in our own cafés. we've opened two cafés, one in venice, california and one in austin, texas. we're opening one in new york on elizabeth street that will be open in june and now we have portland and san francisco coming later. the key to that is we have footwear for sale and eyewear for sale. those of the two products toms has been in, so building a café experience around not only selling the coffee but also hoping people will buy our footwear and eyewear when they visit. another revenue stream to fund our retail growth. >> what is your goal? do you want to take on starbucks? >> i don't think anyone wants to take on starbucks. there's a real opportunity in this third wave of coffee brewing.

looking at the cities we go to where we can really create a community space, we want people to come enjoy coffee and i feel i have to rush out or they are in an environment that feels overly commercialized. the cafés feel like my living room and have artifacts from our trips. even though our customers can go to rwanda and meet the people we help give sight to, they do to see pictures and videos from the trips and have the experience and feel like they are part of it. >> coming up in sports, the final four is set. we will tell you who is in and who is out. we will also hear from the knicks forward and his off court ambitions. it's billed as the world's richest horse race.

the dubai world cup. here's how it ended. take a look. ♪

>> this is "lunch money" on bloomberg television. we are also streaming live on your tablet and smartphone. in sports, another bracket busting weekend for march madness and the final four is all set. aaron harrison hitting a three-pointer with three seconds left, giving the wildcats a 75-72 win over michigan. all five wildcat starters are freshmen. we will see a lot of these guys in coming years.

saturday in arlington, texas, it's going to be kentucky versus wisconsin and florida versus connecticut. florida has won 30 games in a row. connecticut was the last team to beat the gators. that will be an incredible game. the new york knicks amar'e stoudemire -- relativity media known for its shows, but it's also a large sports agency. jon erlichman sat down with him whose agent is ceo happy walters. >> i'm a behind the camera kind of guy. but relativity brings great opportunities to get involved in the film world which would not have been there if i wasn't involved with relativity. >> we brought his ideas -- i don't know if a lot of people know, but he was one of the producers of rock of ages which has been on broadway for five or six years. they were chasing him down the street after the show. >> did you hear about the movie business being this big money

thing? you're looking at places where you can be investing and building on your career, what do you think about the film business? >> you want to be smart about what you are doing. >> we talk all the time and i say here's a project we're working on. it's pretty cool. read the coverage and the three or four page summary of the script and see if you like it. blackbird, which is the movie we did together which comes out in november where he's actually a partner of ours and produced -- we shot that last summer. that's the first one we've done together in that capacity. we don't want guys investing on things where there's any risk at all of not being successful. >> sometimes you guys do these digital shorts and team up with other members of the relativity

family. what is the goal of the like that? just to get the word out and show a different side of yourself? >> absolutely. it's one thing when you can just show your acting skills and have a humorous approach to it. >> it's not basketball, but it's got bounce. we're talking about today's mystery meat -- the latest exercise fad. you can't make this stuff up. trampoline workouts. ♪

>> it is 56 past the hour, which means bloomberg television is on the markets. let's get you caught up on where stocks are trading -- equities are rising. 1872.g at

the dow is closing a triple point again. 1648. the nasdaq is the best performer. closing.1% or 43 point spoke in chicago and she said the fed is short of reaching its goals. , the founderestor of loophole to strategy and he told betty liu that he is worried. >> history tells us you cannot keep running the printing presses without tipping into something that could be much worse. we are seeing signs very early signs of inflation attornment in the commodities every right now out of the 20 commodities we monitor. as they are still negative and on balanced by a little bit. look at what is happening in terms of food prices and when you go to the supermarket. and the fact that

no one is concerned about it makes me concerned. aretephen mentioned we saying inflation and food commodities. let's look at how the widely used food commodities are trading so far this year. corn futures entering a bull market up 20% to stop juice up. coffee has searched -- surged d ue to a drought in brazil. adam johnson. >> a new month tomorrow means we find a new stocks to buy today. a little insight in action. fresh off the portfolio. i want to share an observation that carter shared earlier today. bully --n their invariably --

aww, the open word -- upward li ne. it has been a flat year. ,ll of the people running big that means a lot of selling. here is an example. netflix. it has been up big. it has a recent correction. that is what he is talking about. the correction right here. it has gone back to the trendline. there are strong earnings growth. that observation got us wondering what else is out there. here is what we did. we look at the s&p 500 that is up least 200%. that as a profit-taking candidate to at least down 5% over the past few days. earnings are forecast to buy at least 10% in 2014. i found 22 names that fit the bill including netflix which made my cut.

here are 10 of them. kors,s, expedia, michael trip advisor. they have had huge run ups over the past couple of years and have traded down. they are candidates for a new month. i post all 22 on the twitter handle. a >> check of the treasury market. a little strength on 2-year note. down by about the three basis points. where on the marks a dan. that is it. i am olivia sterns. ♪