>> live from bloomberg headquarters in new york if this with erik makers" schatzker and stephanie ruhle. >> tech selloff. some of the nasdaq said he gives names. what has them so concerned? the saturdayt night live treatment. the lawsuits are piling up. on the vine. the 19 old college freshman with millions of followers. companies like pepsi and eight you are hiring him to help their brands go viral. you are watching "market makers"

on this monday. vine ist to say that lost on me but when you watch you cannot help but crack up. they're pretty awesome. time now to get to business. the top business stories from around the world. stocks are dropping around the globe today. a tech selloff is leading the way. the s and p, dow jones, and nasdaq all down across the board. investors have been selling some of the bull market best performers. a management reorganization of charles how it is now copresident and will develop a new era of leaders. a total of 10 executives will have new roles. the vice chair told bloomberg tv

this does not signal the ceo is preparing to step down. >> i can be very clear on this. i have spent time with larry. i have never seen an executive as committed, intense as lately. he is not going anywhere. >> in sports, kentucky is a 2.5 the ncaaorite to win men's basketball championship tonight. neither team is favored when the tournament started. kentucky was seated eighth in the region. all five of kentucky starters are freshman. what does that mean? they are going to have a huge run. they have another three years. they have so many seniors on the team. >> are you wearing kentucky blue? >> maybe i am. trouble.s in the nasdaq was the worst in two months and it continues this morning. you have heard this before.

a correction may not be a bad thing for a frothy market. he is had at technology, equity research. correction? good thing? at thing? -- bad thing? >> it is not surprising. more stocks in more speculative areas have been indicative of some excesses. we are seeing a lot of those last wrong off over the couple of days. we do not think it is that unhealthy. it is somewhat of an exaggeration to suggest there is a massive tech selloff going on. you look over the last month. we have seen declines in the market you're the ones in the technology sector are not that much more significant. >> perhaps not yet. there are an awful lot of momentum players. what is the risk that this continues? >> i think the concerns at this become a just the fed

little more proactive in some of the actions that could result in higher interest rates? people were thinking about earning season around the corner and wondering if technology companies are going to be able to deliver not only results but favorable guidance as well. >> let's break this down. let's say this is a minor correction. what tech companies are a buy for you? >> there are a number of technology names we like. we like bellwethers like emc and qualcomm. we think it makes sense to look at companies that are larger, balance sheet and are well positioned across a number of different categories. in the case of qualcomm mobile. >> how about things you do not like? facebook, for example, sold off butst 20% in the past month

is almost trading at 50 times forward earnings. 165on is trading at earnings after dropping 13% in the past month. >> we have not recommended amazon or facebook or twitter for some time at this stage. we have actually had sell recommendations on amazon and twitter within the last couple of weeks. we have become less negative on some of the names. another name is webmd. we think it is a name that is overvalued. another is adobe systems, more of a traditional software company that being valued as an on-demand cloud software company. we do not see that. >> let's say i am a holder of twitter. i want to sell out to some of my positions? them like wecall see them. in the case of twitter, we covered the week after the company became public with a

sell opinion. we have that until a couple of weeks ago at most. we have a neutral opinion. we expect which are to perform in line with the s&p 500 over the next 12 months. it means we're are not positive. we are not saying sell but we are seeing neutral performance. >> here we are. the market had a big move on friday. if you wanted to get investors a prescription, what should they be doing in tech? evaluatingt thing is what they have and why. one of the aphorisms we use around here is this notion that when you are in the midst of a market storm you want to be on the bigger boats. emc and qualcomm makes sense. it makes sense to come up with a wish list of names that you are interested in and might want to see certain prices on.

other names we like, by the way, include symantec and western union. strong balance sheets. ready substantial dividend as well. that is an increasing theme in the sector. >> speaking of deep value, what about hewlett-packard or microsoft? considerably this year and beating the market handedly and both trading at single-digit multiples. opinions of both of these stocks. we did not see the turnaround coming in hp. we do like intel here. we have a buy opinion. we think the are a lot less levered to the pc category then people might think. that is another example of a name we like. another name being hit right now and over the last couple of days is yahoo! we upgraded that stock around $35 a share.

it is trading below that. we think there is a lots of potential with the alibaba ipo. we see potential for reducing value related to a turnaround. >> what kind of moves? some say alibaba is the only true value at yahoo! and you take it out of the mix and what do they have? i would leadnow if with that exactly. i think it is fair to say you are right. alibaba has been the driver of that stock train for the last couple of years. we continue to expect that to be the case. also consider that they have a substantial stake in yahoo! japan, which is a market leader as well. last but not least, we think that people are assuming that yahoo! in terms of the u.s. business and international reach are going to continue to decline. that might be the case. tomarissa mayer's is able stabilize and improve metrics and operations, there is an

opportunity. the company has a tremendous amount of allen's sheet flexibility. there are a lot of options for yahoo! at this point. need to leave you there. do you think marissa mayer has the ability to do that as a ceo? >> so far it is really too early to tell. a lot of people have been penalizing her because we have not seen the turn yet. she said from the get go that it will take years to turnaround yahoo! we think within the next year or two we will know more about the progress they have made. >> scott kessler, head of equity research at s&p capital iq. the small selloff in tech. three days worth almost good for 4% and the nasdaq. >> if you are ceo, you know things are not going well when you get skewered on saturday night live. that is just what happened to general motors. we will find what that means. believers are

gathering for a conference in new york. we will talk to one who invests in bitcoin startups. we are streaming on your smart phone, tablet, bloomberg.com and on apple tv. ♪

>> welcome back to "market makers." no mercy for mary barra. gm in theleaders put hot seat and so did the cast of "saturday night live." >> the first rule of new gm is you never talk about old gm. >> are you even familiar with the defective switch? >> can you use it in a sentence? >> are you attempting to roll away? >> i believe the floor is slanted. >> are you attempting to roll away? not a good thing when the crisis reaches punchlines that is. i want to bring in matt miller.

in detroit we have jamie butters. i want to start with you. we are laughing about this year it it is serious. when saturday night live makes you their opening skit, that cannot be a good sunday morning. >> you are there. hearingsthere for the and watch for two days. it was not amusing for mary barra. it was very difficult. it is a blue difficult for her. it was very amusing to see it replaced. >> she claimed to not know anything. her i gmis itch of headquarters telling people to be quiet around her so that she does not accidentally absorb any knowledge. she went out of her way to know as little as possible. >> the great thing about satire is that it is basically true. how close did that come? did not want to talk about anything related to the

main problem at hand. she has had three months to figure it out. she said she found that in december. it is amazing that the head of manufacturing, engineering, product development, purchasing and supply does not know about this. someone became ceo, told her about it. in the last three-month she still has not figured out how we did not get to the top. it seemed a job that would take a matter of days. she does not want to hear anything else. >> do we need to give her a break? she has no other option. i suspect the gm internal/external counsel has her surrounded and said to put a muzzle on. she deferred repeatedly. it was, at times or painful at watching the hearings because people kept asking questions about things she probably does have a pretty good handle on but she does not want

to get out ahead of the investigation. not want to say "it " and itke this guy lied turns out something else happens. they want to spend their two month to really nail everything down. not look really good sitting there in front of congress being asked questions and not answering them. saturday night live would be on the thing she would not answer. >> that is what makes it funny. >> she's not even know who her predecessor was in the skit. she did not even know who her predecessor was in the skit. >> they did a great job. they were very funny. what you think about the fact that she sent a statement out the day before saying she was going to be as transparent as possible and then she was not as all transparent. what is the point of practicing prefacing it s --

with transparency? >> she was being transparent that she was going to deferred to the belugas investigation and that she does not want to presuppose what the feinberg solution is going to the. before the hearing she announced whosead hired feinberg specialty is making sure that people get paid and complicated situations. she did not want to commit to saying we're going to pay people we do not legally have to. she's waiting for the process. you can say she's not being transparent or is about what the process is. they have hired these guys, brought them in to do their things. when they do, they will proceed. >> we understand this. we follow this for a living. you and matt are very close to the situation. we know what mary barra said in

the testimony. the rest of america is judging her leadership on the basis of a saturday night live skit. how much of a problem does that goes for gm? >> it is never great when you're out there. stephanie said that in the opening. the four winds ceos of the detroit automakers went to see the bailout back in november of 2008. john stuart jumped in a little bit quicker than snl. they cannot resist the natural drama of having the worlds colliding, corporate world, gm ceo, coming to congress. there is a lot a good theater on both sides. it creates an image that people can hold onto. >> this is something we will clearly all keep watching. it but itghing about is not funny. >> 13 deaths have been linked to

this. that is just what we know about so far. they are recalling 2.6 million vehicles. people are still going to be driving them around until they get into the dealers. is not even a safe situation going forward. .> thank you matt miller and jamie butters joining us. diving deepns are into digital. the technology they hope will help them reclaim the white house. ♪

>> welcome back to "market makers." the republican party was willing to admit they had major flaws in areas in the

elections. the question was how they would try to fix it going or words. went inside the gop's retold data operation to take a look at their new and improved technology. it is the first in the series "powerbrokers. >> the 2012 postelection headlines told the story about president obama's data team's victory. officials and their donors wasted little time demanding the resources and talent to match tech savvy and avoid a repeat. enter chuck. is the team that they left. we have not only the people that work with our data, who aggregate it into the quality control, and we also have the scientists, the people building model off the data. >> he is overseeing a new model for political parties efforts to

streamline the massive about of voter data. he is working with $70 million in a recruiting effort that has reached the top engineering schools in the country as well as facebook and linkedin. >> we're making the right investment to make sure they have the data they need, predictive analytics they need. a platform building designed to streamline the reams of voter information comin. he plans to utilize constantly evolving sets of apps. meet the chief data officer. he point to republican david jolley's special election big tree as a positive direction. >> we are multiplying upon it. >> it served as a beta test for the rnc data platform. they have access to the

real-time data collected or purchased from vendors including your home or car purchases. >> we can observe a lot of it passively. >> the rnc inc. they can match of the obama 2012 data mining systems and improve on them. >> how do you gauge numbers wise what you have done? to the question on the wall. does this drive data and dollars? is it helping us put them on a path to vote for candidates? notepublicans are relieved to have to take obama's team had on this time around. no longer have the imperative of getting an incumbent president reelected sense ofa less urgency. we have a significant chance to win in 2014. >> phil mattingly is here from d.c.

what are democrats up to? >> when you talk to republicans and the folks over at the labs, if they think with president obama not at the top of the ticket this is where they are is a brain drain. it is basically cyclical. in 2004, republicans spearheaded public eating -- spearheaded this. they claim they're getting all the obama for america information and they will use it for all their. a lot of skeptics. >> why would there be skeptics? why what an team obama want to successfully pass the ball? >> the rents is does the technology, is a dit dated? the technology is often made by the candidates.

candidate transfer that in whole and have the dnc use it for hill candidates? >> phil mattingly, love the package. we have a lot more to cover. coming up, private equity firms jacking up feed. ♪

is monday here in new york city. i am erik schatzker. >> i am stephanie ruhle. time to cover private equity. private equity firms may be basing sanctions after the sec found a majority of them charge inflated fees and expenses. cristina alesci has been following the story closely. come as a surprise? if you look at how phenomenally they have done and how well they

i know they have grown their business a lot. they have benefited from the financial crisis. there is a huge difference. >> absolutely. i do not think this comes as a surprise to too many people in the business. there was and mandate to increase oversight and is very opaque area of finance. these contracts between theirors and the firm and portfolio companies are not really standard. custom edge toa it. because of that and the fact that investors were making so much money alongside the steve schwarzman's of the world, they fees andscrutinizing expenses. now the dynamic has changed from the regulatory front because of this mandate -- to what your rule fees can be?

if you look at the high-yield market, you cannot make more than x. that is still the market making the decision. it is not an and forced to roll -- enforced rule. >> there are some industry standards. exactly. is are youoint disclosing to your investors exactly what you are targeting? that is where the sec does have authority to save i do not think so. we are in the second phase of this. thepast two years have been "get to know you" phase. he have requested information to understand the business better. now they are inside. they're in the weeds. they are trying to make heads or tails of this. they have found over 50% of the 400 firms they have analyzed

were missed charging fees. they were either charging too much money, the investors too much money, were not disclosing it properly. this will become a take story at some point when one of the big firms get dragged into this. the firms obviously have a reputation and a standard. they will be more careful about doing these things. once a big firm get dragged in, then you will see the headlines role. >> i know someone who can help us figure out what is right and you is wrong. he is cohead of the management group. as christina pointed out, it was inevitable that this would get a lot more scrutiny. result, 50% of the firms not disclosing adequately to their limited art news, surprise you?

it does not surprise me. the concept of disclosure are not the same. the sec looks for much more specific as closure. this is a clash of closures. >> we spoke earlier this morning. we spoke about the big firms getting dragged into this. you have your boots on the ground here. what do you think the potential is for this to be dried into an inquiry? >> it is hard to say what they're going to do in terms of enforcement or action. this is across the board. they're looking at all kinds of companies. tend to putompanies more dollars into compliance. hard to knowis where the sec will come out in what they will find here it >>

even if more dollars are coming decide the type of fees they are going to charge. what does the client have to do with this? >> basu not decide themselves. the custom. large institutions and what expenses get charged in which do not get charge. institutional investors are taking a much closer look at that. particularly with the bigger companies. ofis it strictly a matter disclosure? i was under the impression that some people have problems with the kind of fees they are needing. it seems absurd, charging a per

folio company for the pleasure of the acquisition. easier time had an with it. >> can you do this again? >> the two more conventional fees are the deal fees, charging a portfolio company for the pleasure of having been acquired by the private equity firms. does this adequately explain it? of what the sense sec has the biggest problem with? have this with certain type of fees. understand why portfolio companies are paying the fees. here issdiction disclosure. it does not have jurisdiction to set fees. it does not have jurisdiction to

save this kind is appropriate and this is not. be charge and expenses can be taken as long as they are exposed appropriately. it is a fair amount of specific disclosures. mind ishing to keep in the fees that the private equity firms charge these companies sometimes go back to the investors. >> that much i understand. in all cases it does not flow into the pockets of the managers themselves. >> that is worthy disclosure comes in. you know this better than the two of us. yes they go back to the lps in many cases. many times it is because the lps have been pushing back. >> in some instances they could

go back to the private equity companies themselves. it depends on the degree of negotiation. in the larger private equity plans have been much more diligent and harder and are looking to get these paid back to the fund. a dairy specific exam into these fees and expenses. muchow the sec wants to go broader and deeper. what is next? what do private equity firms have to be worried about next? one is the area of coinvestment. they are taking a hard look at what investors who are arty investors in private equity funds, what do they get to invest alongside the funds so that a private equity manager may find out that there is a

need for a $500 million investment in the fund may only want to invest 300 million. back.nd manager may go it raises a number of different issues under the securities. the least of which is disclosures. heardy quickly, i have from some private equity managers that certain sec offices were making it very clear in their examinations that they did not like the concept of the deal fee. do you think there is the possibility that it could be effectively outlawed? do not think the sec has jurisdiction to outlaw. --t they can do is assist insist on disclosure that is so clear, so involved that companies do not want to make the disclosure and do not want to engage in the this.

in terms of being able to outlaw, they do not have the jurisdiction to outlaw. thank you very much. own cristina our alesci here with us in new york. onwhen we come back, betting that coin. the value has dropped but the porters want to create an economy based on the currency. you are watching > "market make" on bloomberg television. ♪

with 68 teamsted vying for college ask about biggest tries. then march madness happen. two teams left. helping make it all happen.

ups. just not the way you might think. a call themselves a logistic company. expanding beyond packaged delivery. look massar takes a closer . >> two weeks ago this was a football stadium. 63 truckloads and 10,000 square feet of floor weighing 33 times. all that making its way to the at&t statement -- stadium outside dallas. >> anything that is not nailed it down to the stadium has been delivered by ups. has been working with the ncaa since 2010. they make this. >> logistically there is. we have been trusting our little baby to them totally.

ups is responsible not just for the floor but also to be balls and new spirit >> they bring these to put them in the right place. >> it means ups acts were like a coordinator. it can also include warehousing and inventory management. >> is there a day when it is important to impacting delivery? >> there'll always be a need for small package delivery. split.uld be a 50/50 >> possibly. >> ups. you have to give them credit for diversifying. >> no question. for ups to really make it, i think the team will have to start wearing brown. >> nobody wants to do that.

>> come on. coming up, one of bitcoins biggest backers. we are talking the founder of bit agenngels. stay with us. you are watching > "market make" on bloomberg television. ♪

>> skeptics always go back to the fact that digital currency plays a small portion in financial markets. that coin stand as a currency relative to more conventional offerings? at the end of 2013, this chart came out showing the biggest currency is of course the u.s. dollar. just as a basis of comparison, the australian dollar is about 1/10th in dollar supply.

he had the guatemalan currency. -- and then you have the guatemalan currency. as big of a deal. 6.75 the onion at the end of february. since the end of 2012, the money supply has increased 11%. bitcoin israte of about 50 times. it has gone from a very small amount. most has come from the price appreciation. to a much smaller extent. a new bitcoin is being mind as well. full credit to fitch as well. they put that together. we did not just come up with this on our own. >> thanks. expert. bring in an it is not just for buying and selling pizzas anymore. do not tell matt miller. a startup called bit angeles is

betting this can be used to create any kind is sharing economy. joining me is davey johnson the founder. at 28 years old, the are the expert that knows all things bitcoin. what do it angels do? more than as currency. it is more than a payment network. this is a technology platform that we can use to build all sorts of disruptive technology. we are starting to see people take the equine model of open source and apply it to all sorts of different technologies. we talked about the share economy. instead of having number or left lyft you replace it with a token system. >> what are your credentials? so many people are doubting bitcoin, it you are saying it is coming from outer space.

why should we trust you? it is fair. >> sure it is. i've been in technology for 12 years. i remember the late part of the com days. we have this incredible open-source protocol that people are using to do all sorts of things we do not imagine at the beginning of the project. remember fromy i 97 or 98 is what i feel today. i would say bitcoin is more like 1994. it is still kind of geeky. try to cast her eyes into the future. in 1994, people were talking about some of the things we saw in 1999 and 2000. what do you see? fund thata venture just recently close. our vision is to take the bitcoin technology and take it to its logical conclusion. we're seeing people launch

projects for sharing the extra hard drive space on their computer and getting paid for sharing the internet from their phone or mobile device. we're going to see this technology stack by technology stack, disrupting the way we get storage,power, hosting all the drop boxes of the world. >> this is possible because of cryptography? >> that is right. >> exactly. because bitcoin gives us a secure way to transfer value it makes it easier for us to create other tokens that represent other values. let's go to storage. there is a project about to be announced tomorrow at the conference. >> what is it? >> i cannot say it. they have a scoop about to drop tomorrow. they have an amazing project we can share storage from your computer and get tokens back from that. consider paying for dropbox, they are paying you to share

storage on your computer. using cryptography from bitcoin. >> this technology and you are describing is central to bitcoin but bitcoin does not really have to exist for this to thrive? >> it is true. we will have a lot of protocols that work on top of the coin or in conjunction with. this is an application working on top of that going. they are issuing tokens on top of the bitcoin lecher and using it as a technology to transfer the coins around. >> the value right now is still measured in bitcoin. >> correct. isfor those who say bitcoin the internet and money, what does that even mean? hd cpilar to the way gifts as a way to transfer data around to put up websites, it is a general way we can transfer value across the internet. imagine all the things you can do with that, whether it is

stocks or bonds or financial instruments. all of these technologies are being experimenting with. you will see all the technologies coming out. these projectsl are super: everybody loves them but bitcoin is in the middle. what happens if the bitcoin collapses? the protocol has been pretty well tested the past five years. the risk of technical collapses pretty small at this point because of the number of security experts leveled at the technology. you are talking about an economic collapse, every time somebody build something on top of bitcoin it increases the value. in more projects that succeed, the more valuable bitcoin will become. >> are the guys who created the protocols going to be appropriately paid? you have an opportunity to make a lot of money here.

is any of it going to flow back? for all the open source developers, this is an opportunity for the first time to monetize open source. they can release these open source systems and attach this tokenized system and get reworded by people using their software. we are going to see an explosion for all thesen developers who are doing the open source projects. >> that is pretty cool. >> exciting. impressive. you have been working on this for 12 years. >> 15. is zeroi was 16, there shutout was thinking of something this innovative and complicated. another reminder that i am old and unimpressive her. congratulations. welcome. will be backkers"

in a couple of minutes. the secret source of "captain america" at the box office.

>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. >> imitation is the sincerest form of hollywood. focused onown is sequels like the record-breaking "captain america." is short videos attract , andons of fans s intention of because -- best known brands. >> the only way to go is up. we will talk to the ceo of one of the nba's worst teams and find out his plan to get back on

top he i'm smelling moneyball. welcome back to "market makers." for the:00 a.m., time newsfeed, these are the top business stories from around the world. new york's top banking regulator is now investigating credit suisse overt tax shelters. they focus on whether credit suisse's private banking practices resulted in tax evasion. world wrestling entertainment got smacked down. its new $10 month online video fell well short of an estimate. asres are as much -- down much a 70% today. another crash for hbo go, the online streaming service. they had problems last night because of demand. this is a purveyor of game of thrones.

the same thing happened last month with the show the detect that -- the detective. >> i want to point out that i have been a critic of all of the fans before last night and seeing it. i maintain my position. anyone who says they love the storyline, the history of the is the costumes, it something to get over. >> get to watch all three seasons. myi'm just saying because son won't get into bed because they show was on, and we're just waiting for a scene where they're all new government that is what that's euros about. it is a good reason to left of that is just why you shouldn't get why so many people love it. >> that is why many people love it. >> the story, the hottest. tory, the nudity.

is addings xbox team big on television. xbox entertainment studios unit told bloomberg and his -- it has committed to six tv series series.g a halo why are they doing this? we got a sneak peak. take a look. ♪ low-key santa monica office building, they're planning their db future, and it ties to this. xbox entertainment studios is a unit of xbox created to make original tv shows. >> this was created with the help of microsoft. >> xbox studios is developing lots of shows. a steven spielberg produced hello sears, a robot theory or series series, a robot

called human. to watch you will fire up your xbox updated you're one of the 48 million members of the online wtertainment an network would play interactive video games the same way. cells will be injure, if you up for you would be able to do low-key stuff that gamers like to do that is different from lying on your couch watching cable. microsoft is doing this to keep xbox loyalists happy. one thousandorth dollars in purchases to microsoft of a number that would tv was tv -- if part of that. tv runs on the wall.

>> adding to that tech office get them a ping-pong table, a well-stocked lunchroom, and require week commemorate all of our successes by ringing the bell. >> let the games, make that tv goes, -- shows, begin. >> jon erlichman joins us now from los angeles. it is not just xbox and we learned this weekend that yahoo! is getting into the original scripted programming game as well. so this argument that we love to hear content is king have it really is. >> everyone has a different reason for doing it. we just highlighted their that for the xbox of a ud dvd originals that keep people playing xbox can be using the xbox live service, in the case of yahoo! this is the time of year when they try to get the advertisers excited and what better way to do it than to say we're going to be a big splash into television. it is sometimes easier said than done. one of the biggest questions in this new world of television is what took -- where do you watch all of this?

what are the challenges yahoo! has had in the past because it has invested money in originals, is where do these air? is that on the main home page, do you have to look elsewhere for them? some of the talent that is worked with yahoo!, we've heard their frustration on the placement of this. that becomes a very important or a place like yahoo! microsoft which has this content housed in that world of xbox, but what of other people want to watch it? what people want to pay for it elsewhere? have to figure out the distribution just as much as they have to figure out the shows that they will do. >> pigging out distribution -- speaking of distribution, they can say that microsoft and yahoo! are tech dinosaurs trying to be relevant, but microsoft hundreds ofn thousands of living rooms. we do log onto yahoo!, but to your point, where is it going to be?

on the xbox and we know it will be on submenu that should in theory, it is easy to access as an apple tv. >> absolutely. we were talking recently about amazon making its own that top box. u devices, apple tv devices, and now the xbox were most of the netflix users are streaming the content. microsoft knows that people are watching television to the xbox, and they are saying to themselves, how do we differentiate ourselves versus sony and the playstation, and any other device? they feel this is the way to go. they will all be easily take some time to build the shows to secure the xbox fan for the long road. >> those binge gamers and tv watchers who currently playin willfor six hours a time just bundle it all up together and not leave their homes for days. >> i just want to know if microsoft can build or make a tv show as cool as the surface or

the zune. >> not so much. they can use amazon to deliver food to their home, so no one will ever leave the house again. --will look from the people like the people from the movie wall-e. thank you to jon erlichman. we're going to stick with entertainment, because we have a big number to share with you, $96 million. that is how much "captain 2" made in its opening weekend. movies used to be where went to die, not the case any longer. alix steel has been digging into these numbers. longve been saying for a time, nobody has an original any longer. not only are we on chapter two of "captain america," but this is a, book that came out in the

1950's. >> this movie was awesome. i would just like to point that out. that aside, they did revive a sequel -- >> people went to see it because they already knew and trusted the brand. >> comic book sequels have not always done well. originals and not done we like the hulk. this is a new advent not only for sequels, but also for superhero movies. they are a little critic proof. fansbout what their think and not the critics. the other thing that has to do it is marvel studios in particular. they are sticking with the amex, and this is a novel idea. this used to be a way to sell the ties, and now it is only being storylines and that is making a difference. >> is it a chicken move for the studios? they are not taking a big risk. they're using a proven

successful entity to build off of that. people did go to see the whole movie because they knew what it was -- >> but it is the franchise. to have to think about where it is going go on here. it is streaming, on-demand, all of these superhero movies they tie on another film, and it gets people excited. .hey watch the tv show shield is based on the vendors, and they will have netlist original programming as well. all of the other studios are trying to copy what marvel has done. we're having an x-men that is relating the past in a newbie. -- the past to the future in a movie. >> this is good business. >> my family could go see the captain america movie and the cost of they already own. >> exactly. but they are the number two franchise right after harry potter for all time. mad/.ole situation

yes thor, captain america, iron man. >> what about daredevil? >> they messed up on a lot of comic books before, and they are now locking actors for long-term contracts, was helpful the cost. >> a lot of great actors. >> they also tie these movie together and they are backed by disney. that gives them a huge powerhouse. they have theme parks behind them, product placement, not just about his division commanders about the franchise. -- the distribution, it is all about the franchise. come tomorrow

dressed up. >> people would tune in for that. >> game of thrones is not about the costumes. that is baloney. but i liked the books. >> alix steel with the science of sequels. >> making it to the top of the nba, it is no slamdunk or the philadelphia 76ers. we will ask the ceo what his plan is. >> selling and six seconds. the video sensation that is one est things on vine. ♪

>> welcome back to "market makers."

let's just say that the philadelphia 76ers are on track for one of the worst seasons ever for professional basketball. they lost a record-tying 20 games. it may be all part of a much bigger strategy. ceo of'neill is the 76ers which is owned by private equity giants. they do not make mistakes. welcome back. talk to us. this is a back record, but you have said before you're waiting for the season due at -- a bad record, but you have said before you're waiting for the season to and. what is the strategy? >> if you dig a position in the company, and they were managing their business week the week of a month-to-month, or even quarterback over, i am a seller not a buyer. you need a plan. had we had this year, we two lottery picks.

recruitment -- the rookie of the year, but the number one pick last year. he will be coming back up an wave two lottery picks this year. in the deepest draft, and we have managed the cap. >> how hard is it for you to recruit lawyers -- players? >they want to be in the hot ities. >> new york, l.a., miami, after that we are really comfortably with chicago, dallas, boston. >> from an arena standpoint? >> absolutely. >> you are a building plan? >> absolutely. the matter isf that other teams are trying to do the same thing as you are. orlando is trying to do the same thing, boston is tried to do the

same thing. milwaukee has the worst record then you guys, and pretty much trying to do the same thing. bottom, a race to the can everyone get to the top as fast? >> their different ways to build up a championship contending team. austin had a -- boston had a tough draft. if you look at oklahoma city, they get to read it within the get west root, then they get hardened, and now the team comes up together. there are several different ways to build a chairmanship contending team. there are teams active and aggressive looking at this draft of and for us it is really about how do we build a culture? how do we get a discipline, how routine, workout nutrition patterns, how do we get a coach that can really work with players? we have that. we have a lot of the building blocks and pieces and a wonderful city and a passionate city where the fans come and cheer for us despite our record. >> philadelphia has less fans out there.

they have the most passionate fans out there, but you cannot argue that, but are you intentionally losing games to secure a higher draft big? >> you cannot do that. quick you are celebrating it. >> we embracing the position that we are in. we have been really transparent about who we are and what our plan is. different marketing strategy that most people take. we are staying together we build. we say to everyone that will listen for we are all in. we know what we're doing, we have a plan, and that is where it is. it is different. it is really different from what other people have done. >> is there something wrong with the game? that there is the perverse incentive for people who are doing badly to stick with being at the bottom to help with their draft big? >> i think it is like any other business. this is really cyclical. it is like any other business. time look at this point in and they had a reset most effectively? a reset now to focus on other things and judge our success or

failure vanity differently than the world is judging us, which is wins and losses. we are on the back page on the front page when things happen, and we are came with that. it is a very different situation. >> and is not the same for the nba, as it necessarily is for other sports. you cannot build a baseball team on the back of one player. but you can build the miami heat on the back of king james. , even one more man on the ice, they're rotating all the time and basketball uniquely certain -- is uniquely suited to this type of approach. quick that separates it from other sports, absolutely. >> is that just because of the way of the game? you only have five players. with the football team yo u have 11. >> with the order back printer

that comes run within a decade or 20 years, there might be a strategy that says what are some other thing that we can do to develop and build our franchise. >> is the only way for you to do this through the draft? let's go back to the king james example. cleveland, where it seemed like they could not build a winning franchise to miami, for all kinds of reasons. he was already an established layer. what are the chances that you a james to a philadelphia instead of having to do it through the lottery and the draft and losing a lot of games? >> i can tell you that most of these guys want to win. more than anything else. of us,ncumbent upon all with these lottery picks and these developers to build a foundation and a coaching staff where free agency they can go in and when. >> you have been in this business for a very long time. now here you are, art of an

entity, private equity, who own a hockey team and a basketball team. you see a big difference in strategy echo >> absolutely. >> how so? >> there's is much more emphasis and discipline about the business of winning. >> one more time? >> there is much more emphasis and business around business of wedding. that's winning. they are extremely competitive guys, but there's the patient and discipline that is not yet been seen in this business. there is a strategy and a plan, and we will stick to it. we're not going to end up on the back page of the paper for a dubious drink about or espn shows us for guidance in a row on sportscenter, and not in a positive life. >> i am unfamiliar with this espn. [laughter] into ae will not fold jar strategy, because we know the plan is right. >> the fact of the matter is that everybody who takes over 18 says that. and no overdue on our ceo says we are only going to win a certain number of games because we have decided that is what is

going to enable us to have the fattest profit margins. the reality is that that can happen. when the maple leafs were owned by ontario teachers, they were managed with media. -- mediocrity. everybody wants to win. >> i believe that 100%. the billion-dollar branches is, you can get bigger returns elsewhere, you're either here because you're competitive and/or you want to win. i want to win it josh and david went to win. >> good luck. thank you for joining us. scott o'neill, the ceo of the philadelphia 76ers. ♪

>> coming up, will he or won't

he echo madea regulations about whether paul ryan will run for president. we will ask our man in these the -- in d.c.

>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. >> welcome back to monday morning on "market makers." made in america. you are hearing more and more these days. companies are choosing to manufacture in the u.s. again. we're have been profiling some of these companies, and mastercraft, the largest producer of indoor ski's and producers of powerboats, they have kept all their production in a single factory in tennessee. have a look. ♪

>> we make very high-end waters board enthusiastic toys. of votes wide variety for wake surfing and wake boarding. i am the president and ceo of mastercraft. choose to produce here in tennessee because there is such great availability of labor. very competitive wage environment for us, this is a low-cost place to manufacture. a lot of our dealers are on the east coast. it certainly has been a push to manufacture abroad, but for our product we think the control and quality is critical for us to manufacture and supply locally. >> you want to build it right can be up build an america. youasy access to water, could go anywhere in the world from this waterway.

good take the tennessee river right on down to the mississippi. >> we are built from the outside in. they are actually built out of a mold, so we spray the colors on the outside, and they go in the it isirst, and then reinforced with fiberglass, and would pull it out of the mold. it is built in two parts. the dac and the whole, and when the work is completed, we literally pick the deck up, roll it, andle underneath th screw them together. not have any robots here, it is all manually done. >> there's no better skill set than the people here. quick now starts to look like a boat. not only is the performance of customer,nd board for but what happens behind the boat is equally as important. >> this is the fun part of the job.

we watered check every single vote that we manufacture. we get to enjoy little bit of surfing. >> boating is a lifestyle. you get to do what we generally love, every single day. it is not work. >> are you a good wake boarder? >> i used to be a good water skier. >> did you do it old school in short shorts? >> no. >> coming up. republican congressman paul ryan and obamacare. does ryan think it is a done deal? we're going to go to washington to talk with al hunt. ♪

>> paul ryan is already one of the most important members of the republican party. you can expect even more from him next year when he's expected to come to -- to become the

writer in the house. here's what he has to say about the affordable care act. chris the problem with obamacare, as we are watching the slow rolling fiasco is that rates are going to be really high. you're going to kick a lot of people on endurance, you're putting people on a broken system like medicaid, and oh by the way, providers get hit with massive provider cuts which means according to the actuaries at cms, providers are going to start to go out of business. this is not going to work. al hunt is with us this morning. even after the administration met its 7 million person enrollment goal, clearly republicans like paul ryan are not letting up. i know you and ryan talked about what republicans will do if they win both legislatures in the upcoming midterms. what did he say? >> he says they're going to keep trying to repeal obamacare.

you don't understand that the real world is that so they have no possibility of doing that. so many provisions will be so entrenched that they can change it, they can radically transform part of, but they cannot repeal it. why can't paul ryan give a very straight shooter in many ways say that? if you want to be a leader in the republican party, if you want to run for president, which he has not ruled out yet, you cannot say that we are not going to repeal obamacare. to accept andt like obamacare, isn't it a risk that he continues to be out ?here he echo they jus they've reached their goal. moree longer it goes, the problematic it will be to say repeal repeal after -- without a substitute. what will you do about the ban on people of pre-existing conditions, and keeping your kids on your policy until

they're 26 years old. those are provisions that are very popular. if premiums skyrocket and there are some providers that go out of his this, then they are going to have a stronger case with the rhetoric. this is primarily a posturing because they are not going to undo, or repeal, the affordable care act. >> is what ryan says about obamacare just a matter of having to say it? is what the republican message is right now, and paul ryan rather talk to you about taxes? that is absolutely right. paul ryan is going to face a choice covenant is going to be a choice he has to make for the -- that's pretty darn soon he has to make pretty soon. he can beat the house chair, or run for president.

whatever he does give you would like to talk about other issues, but you cannot do that come he cannot ignore the republican base. the mouth at at the mention of affordable health care. >> and he does take over wiens amico is he going to follow through with the tax plan? ande is going to try variation of it. here is his problem the u.s. to lower the rates to 25%. we would all love that. dave camp worked like mad, and the lowest he could get was 35%, and that was with a a lot of pain. limiting or doing away with some popular deductions. if you get to 25% of it would have to eliminate the state and local tax deductions, home mortgage deduction, really chip into journals. that is tough stuff. >> al, terrific as always. he is the host of political capital, and that is exclusive from paul ryan.

>> when we come back and i hope that kerry is watching because this guy can make you laugh or make you want to buy something and just six seconds. he made a vine just for bloomberg. ♪

>> talk about your overachievers. we are meeting with one of the against -- biggest stars on vine. yes 3 million viewers on his own utube channel, and some of the biggest rants want him to create content. >> let's do this. >> i want you to enter and six

seconds, what do you have that makes companies think you can sell for the? m? >> great content that is quality, clean, energetic. four seconds. >> why? >> something about the pants ripping, able think that they can sell. the production quality is top-notch. it is more than just a six second. d video. people want to know what happened. but the ants are always on before the vine can vibrate them off and then people asking what is happened. >> you jumped in some sort of pipe. >> have you ever hurt yourself?

>> yes. i want to put a little more humor and did things than just hurting myself. these are grazing clips -- crazy clips. but i'm a pretty funny guy. >> were you a dancer to start with? >> everyone asked me that, they asked if i was in jail later origin is, and i'm not. i was just flexible. -- i was a dancer or a gymnast, and i am not. i just flexible. studio for 30 our minutes, you created something, i want to see it. course. gosh.my >> that looks like it really hurts. >> the jeans and boots made it harder.

>> are you making a fool of these companies? if i'm a big-time ceo, and i said i will pay for this, art of me feels like that ceo feels shmuck. rants, that is what they're trying to do. make people laugh. surprise or amaze you that take so much trouble to reach that audience? >> it does. a that is so easy. i am my own demographic and because i know what is funny. that i haveimes spent hours making something, and if it doesn't work, it

doesn't. forinutes to three hours six seconds. a lot of people do not expect that. >> three hours for six second sound like a lot, but things about what goes into a commercial, months and months and millions of dollars. as we all know of their the best car commercials of the single most uncreative thing. are you going to get a job out of school to do this full-time? >> that is the big question. >> are you going to drop out of school? >> the only dilemma i have is necessarily sustainable. >> you could migrate to another platform. >> that is what we're trying to do. >> where do you want to go? >> mainstream. outside of anything

strictly social media. >> do you have a whole team? >> yes. >> how does all of this happened? do you consider this 15 minutes of fame, or do you think you want to take this -- plan to be how you define this business. >> my fans have come to love my personality. my engagement on all of my social media is awesome because i have people who love me more acting in agan paul movie, or on instagram, they fall in love with my personality. >> i can see why you want to do something that last longer than six against -- seconds. why go with old media like tv or movies? --'t a platform like

>> it goes back to the whole sustainable thing. >> you flipped backwards over a car? >> it goes back to the whole sustainable thing. that social sure media sustainable, but movies and television is. fast-forward seven years, this was a flash in the pan, and you look like a fool. what is seven years from now you decide to pursue an engineering career, and these videos live on forever. having thought about those consequences? the movies that snoop dogg was thinkrls gone wild, i they were a great time, but most people cannot -- >> probably a big mistake. i'm not too worried about that, i am the person that was my mind

to something and it will happen. if i want to pursue this, i will make it happen. >> or your parents. when you first started doing this every even what a smart kid you are, and he got into engineering school, did they think this was a good move? >> they didn't think it was a bad move. they are neutral about it. what a thousand dollars, ok. $1 million, they thought it was kind of series working with big brands. >> how lucrative is this for you? >> pretty lucrative for a college students. exactly howt to say lucrative, but for a college students we can get our hands on anything. working with the biggest brands in the world is incredible. they're trying to reach a younger demographic of their tried to expand into places they have not hit. vine is so new and primed for those kind of emotions --

promotions, they can find me and i am popping. celebrity, is a vine and on bloomberg tv. i think eric needs to do a flying dutchman to keep up. >> when we come back, something else. ♪

>> that is it for "market makers ." we have run the gamut. >> tomorrow's something

different the logan bulk of the imf releases its biannual world genvec outlook -- economic outlook. is 56 past the hour, liberty media stake you on the markets. we're going to send you to the newsroom or alix steel has more. >> thank you. we're looking at starting the week in the red here. the 50daq is behind day and 100 day moving average. for a look at what the options market is telling us about where stocks are headed from here, the derivative strategists at mk partners. what is the option market rising in? >> it has been a tricky couple of weeks for observers of the art should market and

volatility. two factors behind that, we have seen modest volatility advance since dues number of 2012 -- ball agility events since december of 2012. with the riskre was commanded specifically to technology company few look at the nasdaq etf, it is down just over five percent when i came in today. contrast that with the s&p 500. has clearly technology taken the brunt of this pullback so far. we would want to stay cautious over the near-term. >> what could this further drop indicate? >> what i could tell you is that this five percent pullback that we have seen is really among the deepest since december of 2012 we always talk about 2012. on that metric you could always argue that we are new the bo

-- near the bottom from a volatility askepect. if you look at the s&p 500, just down two percent or so, we could be looking at a deeper pullback there as well. that is what we keep an eye on. >> the nasdaq and kind of lead the other indexes that are lower there. we are going to be watching yahoo!, one possible catalyst is highly bob is ipo -- alibaba's i.epo. is a well-known story, that's nothing new about the alibaba ipo. really tells you that there is not a ton of activity in the option market, and a ratio of put-call open interest is indicative of significant the shooting along yahoo!. -- positioning along yahoo!.

there is a nice asymmetric set of cover that is to say with the alibaba ipo out there, downsize risk pretty well mitigated, and at all about i -if alibaba comes at a high er valulation. >> some kind of call spread? >> we're looking at to june, we do not know when they will file. recent speculation has been april. that would put it late april or may can we do not want to get to tricky as far as timing goes. we're looking onto june with yahoo! 33 and change right about now. in june we want to buy a 35, 42 call spread. you could do that for about $1.50. you're creating a payoff that is 4.6 to 1. longer-term, are there any

options that you're looking at a price on the outside? >> yahoo! is going to spin off of 50% of its stock. 24% of ali baba. at $120d valuation billion or so. you guys reported as recently as million.ks ago 200 wewe appreciate your insight are on the market again in 30 minutes. "lunch money" is up next. ♪ live on bbg television and streaming on your phone, tablet, and at bloomberg.com. now on apple tv♪

>> welcome to "lunch money." i am adam johnson. in companies, blackrock shakes things up. what does that mean for ceo larry frank? guess who fires the latest shot in the battle for content. we will tell you. the republican party plays catch-up in the race for data. we take you a board mastercraft. captain america nl