direction. we speak to an optimist. forget twitter, you should on quality stocks. hotels and motels, they enjoy an ipo frienzy. good morning, everyone. we are live from our world headquarters in new york. scarlet fu and erik schatzker. >> this is the stuff that happened overnight that you need to know now. the british trade deficit narrowed on a slide in aircraft imports. sweden raised its gdp outlook, predicting a balanced budget by 2016. economic data and the united states here at 7:00 a.m. this morning. wholesale inventories and sales. the fed releases its meeting minutes, 2:00 p.m. this

afternoon. we have new earnings after the bell. allen financial is going public. -- allied financial is going public. it will price after the bell and begin trading tomorrow on the new york stock exchange. quiet day today. futures are up fractionally. 10 year yield goes nowhere. the rogue it's a little bit of strength. a little bit of strength. nymex crude advances. screen. next last 24is better in the hours. two-year yield is better. call it the yellen meter.

tone.set the the inflation-adjusted, price adjusted, trade weighted dollar back 30 years. you can see the long-term dollar depreciation or devaluation. it is very gentle, steady, persistent. you wonder where that path will be in the coming years. an interesting front page today. a nuanced front page. here is scarlet fu with the front page. >> i like the wii you bring up the dollar. a company affected by the dollar and the yen is toyota. toyota recalls more than 6 million cars because of five different effects. -- defects. the cars being recalled include top sellers. restoreany is trying to

its reputation after the massive recall back in 2009, 2010 because of unintended acceleration. >> it is a stunning size. >> think of all the different gm recalls and become a be close to the number when all was said and done. this is all at once. >> there are so far, no deaths attributed to the faults identified in these cars. that is an extremely important distinction to be made. >> you look at the why. you wonder if every other company is trying to get out in front of the uproar over gm. is ford's next? -- his ford next -- is ford next? >> they did on medicare. -- big data on medicare. >> i am too young for this story. >> yeah, right. some doctors are making a fortune off of medicare. almost 4000nt paid

doctors more than $1 million each in 2012. million, -- one doctor got what he $1 million from the government -- what he $1 million from the government $21 million from the government. imagine?u >> i would like to see some better math. i am going to defend the doctors here. is it a few doctors benefiting or is it more than a few? >> we are going to be talking to senator chuck grassley on this. more to come on this. goldman sachs considering shutting down its start will. -- its dark pool. >> what is a dark wool? -- pool? >> it is a private exchange.

>> it is a marketplace. it is were people can buy and sell shares under the cover of darkness. the whole point of a dark pool toto allow investors transact in large blocks of stock. and today possible market it is much more difficult to go out and buy in volume without showing your hand. >> what is the back story? there is always a back story with goldman sachs. >> yes, indeed. i will not know the whole back story for another five years. >> is this about michael lewis? >> what michael lewis was talking about are some of the x.ues including sigma there are more than 40 places where institutional investors can buy and sell stocks.

to have aifficult technological or informational advantage. it is not the popular of a business for goldman sachs any longer. >> i love the name. those are our front page stories. >> our guest host is holly alima croft. it is the secret of crystal ball. joining us also, michael holland. michael, let's get started on the equity markets and the battle that is going on out there. i want you to read justify why i am a bull. it has not happened, has it? >> the big thing that people has been talking about for most of the past five years, the big correction has not occurred. we had valuations that were

screamingly attractive five years ago. we called him ludicrously attractive. -- them ludicrously attractive. these things normally do not end until we get overvalued and we are not there he is. >> you are a well read man. you to explain to our audience have you as an equity guy with responsibility to create wealth use the research of someone like dr. croft. about of the fun things being in this business over a lifetime is that everything that happens in the world has to do with your business. putin today is more important than any ceo in terms of this. would you agree? >> oh, yeah. you are using this as a template to make decisions on

how long to hold jpmorgan. jpmorgan?old any prices we talk about oil , putin more important than any other ceo. >> the north american story is really what has allowed prices to remain in this range. can you imagine if we did not have this growth the north american production and we had this problem with wooten -- putin? we are lucky to have the north american oil story. we would be in a much higher priced environment without it. >> you sit down with the equity people. what do they do with all of the work you put out? your notes are fascinating. what does that have to do with my world? >> i sit in commodities research as well. >> you care about pork bellies? >> i care about oil. >> it is amazing what you learn

on the show. erik, jump in here. >> nobody saw putin coming. >> we had georgia in 2008. >> few people saw it coming. >> i think there was a presidential candidate who did. >> [laughter] what do we see coming here? whether he actually moves into eastern ukraine. that will bring the next layer of sanctions. if he goes into eastern ukraine, that is a much more serious crisis. it will be a much more serious situation. >> you wrote a brilliant note recently on oil. i thought it was quite good on opec and the differentials.

i think this is way off our viewer's radar. what do we need to know right now about the cohesion of opec? >> this is what is so troubling in the middle east. there is a tremendous amount of confidence and prices remaining high because of problems in the middle east. we're so focused on the north american oil story, but libya went from 1.5 million of production to 150,000. >> you were alone calling for higher oil prices. >> libya has no functioning government institution. lots of armeds, militant groups, not a functioning government. we did not think that was a great environment for production. what happensatch over the next couple of weeks in terms of ukraine. if putin moves into eastern ukraine, that is a much more serious crisis. watch the iraqi elections. that's a huge oil story. >> did you sell any shares to jpmorgan? don't answer that question.

we are looking forward to this. here is scarlet fu with the company news. >> let's start with general motors. they're testing the patience of regulators, failing to respond to more than a third of requests for information related to the ignition switch recall. regulators are finding g.m. $7,000 per day as it awaits answers. capital.e onto sac a federal judge wants answers. questions relating to the individuals who profited from insider trading activities. the judge will rule on whether to approve a $1.8 billion settlement between the sac and the government. let's get to the weather channel. it is back on directv. the two sides are settling their three-month-old dispute. no financial details were disclosed. the weather channel did say would cut back on reality

programming and offer more local weather news as part of the deal. they're getting back to bread-and-butter. >> every time i turn it on, they were off doing something -- >> you watch the weather channel? >> i go to a when i want to know what the weather is doing. >> when we come back on "bloomberg surveillance" blackstone is cashing out again. we will discuss with the lucky nta ipohat the la qui means. ♪

>> good morning, everyone.

the senator from arizona is in the loop today. john mccain. a number of topics, including nato and their relationship with europe and russia. good morning, everyone. it is "bloomberg surveillance." with us this morning, scarlet fu and erik schatzker. he will be on tv for 14 hours straight this morning here at bloomberg. [laughter] wonderful to have you here. >> it is nice to be here. >> what do we have? quinta priced its ipo yesterday. this is blackstone stelling part of its stake in the hotel company. the actual pricing was $70, below the marketed range. -- $17, below the marketed range. >> have you stayed at a la quint a? where do they fit in? >> quite honestly, they are

lower than midpriced. >> ok, is this like they are unloading it? >> they are cashing out some of their stake. it is blackstone's third ipo for a hotel. >> hylton was a gigantic ipo. that may be one of the big issues. >> the video is insane. the video of the garden in front of lucla quinta looks like our side. -- versailles. >> it is not the only ipo. we have allied financial tonight. treasury begins to pare down

some of its stake. michael holland has decades of experience in the ups and downs of the ipo. i know you have a relationship with blackstone and you cannot, directly -- comment directly. the ipo frenzy is back. >> absolutely. the ducks are quacking. every time is the same in terms of greed. the two issues that came out from blackstone, both of them are trading premium. they can come out with a third. the word is from other people that they were trying to sell a privately. privately. the pricing in the public market was better.

>> has the knowledge changed? we all used to get these prospectuses. now it is the internet stuff. are we dumber because it is on the internet? >> i don't think so. i think we are still well-informed. for the people who care to do it. as you always have and his i always have. i always that. i think it is easier today with technology. >> what is the first word you would search for? >> cash. >> mine would be preferred. i want to know all of the variations of equity split up but the principles. i was taking a look at overall ipo numbers. in the u.s., 158 announced ipos. value.illion in it has been a blockbuster year. >> is this assumed fees for the

market? the banks? >> ipos are pretty good business. >> fixed income, they do not make that much money. >> thanks to not make 7% on ipos anymore. you're dealing with banks every day. they got bludgeoned. they pay a much lower fee. the old seven percent days are gone. >> this is something we will continue to watch for as the banks get ready to report earnings on friday. we will see how this all plays out into their numbers. coming up in the next hour, a government data dump shows that doctors are taking home a big chunk of medicare costs. we will get senator chuck grassley's reactions. ♪

>> good morning, everyone. ." " bloomberg surveillance." ministers defense spars with chuck hagel, the u.s. secretary of defense. hagel meets with the chinese president today. investigators believe they're closing in on the missing malaysia airlines jet. signals were picked up consistent with those consistent with a black box flight recorder.

yesterday an official heading up the -- the australian official search said he is optimistic. the uconn women's desk about ir 90 national championship -- basketball team 19th national championship. >> time for the morning must-read. material. pre-imf epistle. helima croft with us.

she looks at the geopolitics of the region. does the middle east need a stronger euro? >> absolutely. in terms of the market, you absolutely need a recovery in europe. what is interesting is how this will play out with putin. how things unfold over the next days and weeks will be important to watch. >> the imf has all sorts of constituencies. they marked down russia yesterday. did the market down enough? >> i think the big question is even if you have a big serious economic crisis in russia, will that alter putin's calculus? does he care about this much more than we do so that he pushes on? what are his territorial ambitions? >> michael holland with us as well. you have been big on multinationals. which american companies play in the region?

who do you buy to get a european exposure? >> the easy one for me to think is the big, old tech, the ibm's, the microsoft's. they are all there. putin is going to do something. these guys are not going to get hurt as much. >> we will be right back. we will take a look at the longevity of the bull market. ♪

>> good morning, everyone. "bloomberg surveillance." we welcome all of you worldwide, particularly in europe. a quick data check. it is a non-data check.

a quiet economic week after the jobs report. moves were just fractional. there is your fractional data check. let's get some movers that are more interesting. to be more interesting than what i just did. >> chicos rose 8.4% yesterday. private equity firm reporting an ownership stake. what is it with retailers and private equity? it is like they cannot get enough of each other. >> there was a lot of money. >> amazon is also notable. it surpassed hulu and apple in streaming video. i have been using amazon a lot more. >> i don't like amazon. i like apple tv. there is no amazon at. app.

the quality is the pits. i don't have apple tv. i use it on my ipad. >> i am a prisoner inside the walled garden. >> schatzker is coming over to my house to program the zenith with the rabbit ears. he will be doing that on friday. [laughter] michael holland has seen all of this before. will american business thrive? everything will be wonderful. it is positively biblical. michael holland joins us again. i looked at the jpmorgan chart. the world is coming to an end, biotech is off, twitter is off, the house of dimon is down. >> this is not a bear market. it is fair to guess that this

bull market has some significant life to it before this is over. >> i get upset at the frenzy. we don't even remember what down 10% was. 5%, it we are down 3, 4, is a big deal. what has happened because of all of the nasty things over the last 10 years, people are so afraid. they are so twitchy about everything that can go wrong, that they do what you just described. >> this is a critical question. we doing a disservice to eighte because we w twitter and biotech, when the vast majority of wealth is in boring industrial stocks and boring, boring, boring? >> i don't know about a disservice, but it certainly contributes to just what you talked about. the fact is that people do not

want to hear that ibm had a good quarter and it is up in little bit and it is really inexpensive and they will do ok here. you will not get too many viewers. it is a reality. >> i wonder about this downturn and commodities. -- in commodities. everyone talks about the long-term bear market. do you see that continuing? what does that mean for people who want to chase returns in equities? >> the big story is china. that is the rising tide. one of the reasons why we do not see oil prices cratering is that we do see, we have not seen the demand collapse in china. we do not see it crashing and emerging markets. we look at the north american oil story, but we go back to the fact that we have key producers facing serious problems. countries like saudi arabia will face serious budget crisis if oil prices -- >> is morgan stanley wrong?

is the death of the commodity business overwrought? >> we look at certain sectors and we say -- we look at oil and we still have conviction for next year. -- we look atr china and we say that is a concern for base metals. some of the fundamentals are supportive. we do not see the death growth of commodities. >> do you have a morning must-read? >> tom keene challenges me to bring it and i have brought it. the morning must-read called "powerful disruptive shareholders." by two of the most respected corporate advisors out there. here is what they say, writing about activism.

those are strong words. >> where are you on this, michael? those are strong words. >> they are likening the idea that people hid behind patriotism to inflame the communist scare. to seeks purporting long-term value, when all they really want to do is make a quick. you agree? >> yes. for a known joe perella long time. he is that quality in quality of thinking and quality of a person. i agree completely. the weinberg family is respondent -- these guys toire fend against activism. that is more of a full disclosure point than anything else. >> they happen to be right.

>> if activism is there and carl icahn is doing this and bill lachman is doing that, the boards are in the middle. do you see a new board now? a more sensitive board to outrage about what people are using their cash for? >> boards are like sports teams. some are really good and really strong in the know what to do. they do not pay attention to the noise. >> i just had a nightmare. there is a board that the toronto maple leafs? [laughter] >> what joe and peter say is that institutional shareholders like blackrock, for example, need to speak with a louder voice. capital research, fidelity, i hope you're listening. blackrock is doing it. in the public domain, blackrock really has just started. but blackrock up against bill ackman. put blackrock up against carl icahn. despite their size, they still seem fairly quiet.

there is lots of back channeling going on. the average shareholder does not see that, does not hear that. that is what they want more of. hearinginterested in what your distinction is between a good activist shareholder versus someone that is disruptive and out to make a quick buck. >> that is a great question. i believe that all of the activists we have talked about, they all believe they are the great person, that they are doing it for the shareholders. >> carl icahn? >> is carl icahn a great person? i wanted to ruin your day here. >> he has made a lot of money. >> he has benefited other shareholders. >> periodically. >> ok. it is a big, big debate. frankly, that is the op-ed of the day. >> fewer americans are going to

college. it is a lot harder to get into the most elite universities. stanford accepting 5% of applicants this year. harvard and yale accepting about 6%. rinsed in about seven percent. , about 7%.n the internet makes things easier to apply. there is also an increase in applications from overseas. they are flooding the schools with a lot of applications. >> i think it is a completely bogus analysis because of a denominator. your kids are going to apply to 52 schools? can we get there? the story is that there are 200 schools that are tough to get into. the focus is always on six names or eight names. >> ucla was the one that got apply to the most. 86,000 applicants. twice as many as in 2005.

it is easy to check out these boxes. >> i like this "new york times" article. it has all of these other competitive schools in there. >> there are schools that you had not heard of 20 years ago. there are more than 200. >> does this happen in canada to the same extent, erik? >> it was easy to apply to college when i did it. it was a check the box kind of thing. >> best i have ever seen, true story, you go to wesley and. -- wesleyan university in connecticut. you go in the room, the give you a single sheet of paper. thene side, the answer to questions the previous year. all the parents turn the page over, it is the numbers to the last five years ago. it is stunning. the improvement in student quality. stunning.

>> it is time for the twitter question of the day. tweet us at @bsurveillance. >> we already have a firestorm of response. >> we will be discussing this on the next hour of "bloomberg surveillance." when you are a mom, the debate is, do you go off to work or do you stay home to work with the kids? ♪

>> good morning, everyone. we welcome all of you worldwide this morning. erik schatzker has our top headlines. >> hillary clinton says don't expect a decision on a possible run for the white house anytime soon. >> so friday we will hear? >> [laughter] the former secretary of state is putting off making a decision because she is, actually enjoying my life. she describes the russian president as a tough guy with a thin skin.

airlines are feeling the squeeze. the price of lines has gone sky high. on united for one airlines. alaska air has dropped limes entirely from the menu. e.g. dollarswhat $22 sinceary -- january per box. >> tom is very upset about it. moste moche watched -- watched play date ever. george and the other toddlers did what toddlers do, fall on the floor. those are your top headlines. >> it is time for a surveillance correction. dress.described the

it is not missoni. it is tory burch. she is looking american today. >> i am surprised about that. >> i think it is great. the back story is a real question of what the new zealand people will do about being in the commonwealth or being a democracy and free? >> do you like prince george? >> i do. i follow kate's fashion choices. she goes for tory burch. more of the masses. lower price point. >> it is time for single best chart. helima to jump in on this as well. or aou a stay-at-home mom work outside of home mom? this is from pew research center. what it shows is that in 1967,

half of all mothers stayed at home/did not work in an office. by 1999, the share of stay-at-home moms felt to 23%. since then, the trend has reversed. almost three out of 10 mothers stay at home and do not work, higher than during the recession. >> what is the why? >> everyone has their own reasons. homeay they are staying at by choice. work.y can afford not to stand next to women with ice not in their glass, so when they throw the drink at me, it does not hurt.] this is a serious topic. >> the mommy wars. the other part of it is the cultural guilt enough woman who do work. within this and within the

generational flow, with the pressures that are out there, what is the first word of condition? what is the decision tree that a woman has to go through to say, stay-at-home? >> the first is, you need to work. if you need to, you make it happen, there is not much of a decision to make your it -- make. >> as you go up the food chain and you have a choice, what is the point of debate? >> if i take some time off now, how will it affect my reentry into the workforce? >> getting back into it when to leave. >> that is one of the tough choices. if you offramp, it is hard to get back on. now, be paying for nanny it is expensive, but when you look at the lifetime earnings, what you are doing when you leave the workforce is potentially damaging. >> does larry kantor give you a separate wing? >> he is amazing.

i loved my job and they were very supportive. >> corporations are very front and center on this. am i suggesting they are way ahead of the government? >> i think that is right. a lot of our contemporaries and younger men have figured out that to be truly successful as a business, you have to accommodate. >> what have you seen? >> younger kids, sure. now thatold enough childcare is not an issue, nor is the other big issue -- universal pre-k. that was a fiery debate between the governor and the mayor of the city. >> i think that comes down to the same issue. this is only for certain number of years of your child's life. this is for seven years, eight years, and then the kids can go to school on the run and the decision on whether to stay at home is less urgent.

>> that is like sophomore year of college. >> to sheryl sandberg help this debate? >> i think she did. she said, make sure when you leave, should it be you or your husband? that is a new debate. more men are staying home. >> that is a heated debate. they are having the same debate on "game of thrones." i am kidding. [laughter] up, u.s. russian relations at the worst point since the cold war. ♪

>> good morning, everyone. "bloomberg surveillance." i will travel to washington for three days of the international monetary fund. .ook for my commentary we will have that for you tomorrow on bloomberg television worldwide. we are really looking forward to that. >> this is "bloomberg

surveillance." i am here with tom keene and erik schatzker. the u.s. is threatening to increase sanctions on russia. doing so could have a negative impact on the middle east. russia is seen as an essential player in syria and curbing iran's nuclear ambitions. what are obama's options? >> if you look at the sanctions right now, they are pretty tame, compared to the around sanctions -- the iran sanctions. they are not sweeping trade sanctions. do we escalate to this trade sanctions? i think there will be a lot of resistance to doing that in europe. we are hampered in terms of what we can do financially to curb russian behavior. >> do you foresee a cutoff of russian energy supplies through ukraine's pipeline? >> they have significantly

raised the gas bill to ukraine. the question will be eventually, would ukraine cut off supplies to europe if you had russia cutting off ukraine? we are not there yet. we're going into spring. ample gas supplies. i don't think we're looking at 2008. >> a terrific article this morning on moldova. showing the reliance on russia. ity focused on wine, but applies to hydrocarbons as well. >> i had the moldovan prime minister on "market makers." the russians can quite literally squeeze moldova dry. >> is that going to happen? >> there is a russian speaking breakaway province in moldova. that is a potential frontline issue. >> this is an important issue. >> i want to bring in my morning

must-read. it is from thomas friedman of "the new york times." he says putin does not strike me as a chess player. he says, if we are going to play , we need to be serious. if not, we need to tell the ukrainians to cut the best deal with russia now. >> that is maybe what we should have done in syria. if we are not going to ratchet the sanctions, we should tell them to cut a better deal. if we are not going to go and surprise -- provide significant aid, maybe they should. check more into the foreign policy? >> we do not have the rest of the teammates read that germany -- they are not on the ice with you.

helima and i were talking off-camera, putin knows all this. the sanctions we are working around not even viable. the germans are not going to do them. >> does russia gets a cheap even michael holland has to look at it? >> that is a great question. the answer is yes. gas is goinghe from payment in dollars to payment in euros. that is kind of a big deal. it is a little early. >> what do you see happening with iran? talks are underway right now. >> what you want to watch his whether any efforts on the russians part to undercut sanctions? do they provide new trade deals? will russian banks deal with iran? will they sell them the air defense systems? there are all sorts of things to block the whole talks. >> thank you so much. thank you for your perspective

on the equity markets him on foreign exchange. over 1.38. ack ♪

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a toyota jones, general

motors, a massive recall. the score at general motors, 6.8 million. this is a market insurgent direction. we speak to an optimist on the american economy. forget twitter, you should own quality stocks. net clean after childcare, it is not worth it, the increase in stay-at-home moms. good morning, everyone. you are live from our world headquarters in new york. this is "bloomberg surveillance." what is today? erik schatzker, our bet -- guest host for the hour. , chief sonders investment strategist at charles schwab. we will also be talking their guests about financial literacy or lack thereof in america. trade deficit narrowed in february on a slide in aircraft imports, one of the

things that happened overnight that you need to know. in america this morning, 10:00 a.m., wholesale inventories of sales will be released. at 2 p.m. we will get the meeting minutes from the federal reserve. we have got constellation brands earnings before the bell this morning. after the bell, bed, bath, and beyond. and the former gmac will price its ipo after the bell. tomorrow morning it will begin trading on the new york stock exchange. company news? >> absolutely. toyota is calling back more than 6 million vehicles due to a series of defects. they do not know of any injuries or deaths linked to the problems. the recall could cost toyota more than 600 million dollars. goldman sachs may shut down its dark pool, known as sigma acts. the wall street journal says that goldman is trying to decide whether the money it makes is worth growing and criticism.

the firm admitted that sigma acts had a pricing malfunction that cost its customers. as far as we know, they are linking to the michael/book. >> that is very much in the background, but hard to believe that they would shut it down for that reason. >> the weather channel is back on directv. the two sides settled their dispute and they are scheduled to return to the satellite tv provider today. no financial terms were disclosed, but the weather channel said that they would offer more local weather news as part of the deal. looks like mtv is saying they will offer more using videos instead of reality shows. >> absolutely. look at the equity markets. watch what they do, now what they say. no one looks at retail flow like charles schwab. maybe a bit of exaggeration there, but bonds have provided ample competition in the stock market. must it be on the back of money

moving from bonds to stocks? that is front and center this morning. to me it is a huge question for the next 24 months. will money flow from bonds into equities? >> we saw that a bit last year. but nowhere near to a degree that we saw out flow in the five prior years. your first out flow year for bonds, equities have stayed in the black this year. bonds have also moved into the black this year. yields have been compressed. we have not been a big buyer of the thesis of a great rotation. there was supposedly going to be this mass exodus out of bonds. one of the things we talked about last time was the institutional arena. particularly foundations and endowments. the pendulum may have swung too far from the public equity market. >> with big fees. >> and less liquidity. i think that that is where you might see some reputation. >> ripping up the script, we saw

that hedge fund yesterday giving back money. sorry, i can't remember the fund. when you see the train wreck that is hedge fund performance, what does that say about what retail should do? with a look at these a suppose it sophisticates? >> first of all, hedge funds are often considered asset classes, but it is not, it is a vehicle through which you get exposure. there are plenty of unbelievably talented hedge fund managers deserving of their fees, but others have been lumped in here where i don't think they'd belong, where they are just managing traditional public equity funds and should not be considered an altar -- and altered it. >> market beta, not much more. >> can someone get a memo to erik schatzker, we cannot say beta on surveillance? >> the alpha versus beta? >> say gamut. it is a greek letter moment.

scarlett, continue. >> for those that are basically covering the indexes, late last week and early it -- early this week, does this not indicate there is a bear market coming on ? >> i don't think so. i think we have more of an internal correction among those stocks and that is the big difference. too many comparisons are being made to that 2000 era. withinre some highfliers small segments of the market, but it is neither accepting the market through valuation perspectives. >> you see it in and -- in venture capital. thomas davidson this morning, we will talk about his new project in a bit. you have got a lot of experience at the frenzy of at all. i want to know what you are hearing at social gatherings. the frenzy, is that the whole force right now, where everyone has to get to the exit? >> it has a good clip to it.

we are based in d.c., so i don't spend and i take my doses in silicon valley every couple of months. it is interesting, this incredible herd mentality exists . tamping back, thinking that we are overheating. going out now it is interesting. the billion-dollar ipo that you would have seen seems like pretty small relative to it. >> who else has gone down? i cannot remember. netflix, how has that adjusted your world? >> they have pulled back a bit, but you are still looking at a $23 billion market cap for twitter. i think that people feel a great urgency to get that currency, to be able to get out the door and get public and have that currency so that they don't miss out on the next phase. they have seen the cost of missing out on the next phase of innovation and what it means to

a friend stir or a myspace or others. people feel they have to have that oculus river or other purchases in their wheelhouse. >> that sets us up perfectly for the next point, if you are one of the companies that invested in a rising stock price, you have to use that as quickly as possible. >> you are seeing that in real time. people like mark zuckerberg are using it like a weapon right now. it is not just national. we focus here on what is hot in iowa or silicon valley, but people are looking at huge penetration into africa, india, the large penetration of the user base in china, that is the play that these large social media players are going after. >> absolutely. it just goes on and on. here we are with a market where we are 60,200 56. liz ann, do you have a call? i'mo, we purposely don't, not sure i understand the value

to the listening public, particularly individual investors, our bailey whack. i find it funny to watch those strategists. i don't know where the money will close today, let alone in the future. >> he spoke to michael holland about this earlier. let me ask you the same question. is the media distorting the clients of charles schwab? are they so focused on the frenzy that they are not investing rationally? >> there are pros and cons to the media. the media is obviously an extraordinary information source for investors. armed with that information they are better investors, but there is a tendency by the media, particularly the rapidfire trading, to point to a specific reason for every kick in the market and it is not as simple as that. question all this the time -- why did the market go down yesterday? because it went down yesterday. not every move in the market has to do with a particular headline or news story. >> if that is the case, what

worries you about the market right now? >> i have been optimistic for the last five years and i continue to be. the greatest concern that i had coming out of last year was the sentiment environment. long-term sentiment suggests a lot of worry is intact, but the attitude on investors intelligence suggests a level of froth that was troublesome. and then you had the valuation excesses in the highflying moment. economyd the hit to the from the weather. and it is a midterm election year, which has a high tendency for a big pullback. >> interesting. >> another story i want to bring to everyone's attention, fewer americans are going to college, and it has gotten tougher to get into the elite universities. stamford, for instance, has accepted a record low number of applicants this year. harvard and yell, six percent. from the seniors standpoint, the

problem here is that schools are being flooded by more applications than ever before. it makes it easier to apply, right? >> 20 per kid? >> it was like five when i went to college. >> common. my son is going to college. >> how many? >> nine. >> low. >> my deepest sympathies. no stress, right? >> he is going to college. >> well, our twitter question of the day, let's look at it. this is on education, important. do students need to learn financial literacy or just better math? this will be the focus in about eight minutes. stay with us, futures are at negative one. ♪

>> good morning, everyone. i am tom keene. this matters now. to our guest host, liz ann, she has kept charles schwab slot -- charles schwab clients out of stocks and financial cash. what matters? the key for the economy and the markets, will perforations simply invest? everybody says that this is the key thing here. >> it is. first of all, in nominal terms,

is past its prior high, but the growth rate has been slow. when you look between the spread of age and stock, it is extremely wide. across the spectrum, manufacturing plants, structures, software, you are at or near all-time highs. we know the catchword is there, we are starting to see an increase in ceo confidence at the small company level with -- with lending picking up. the leading indicators suggest we will see a pickup. >> is the goods producing simply going abroad? emerson electric is a wonderful company. are they doing it in malaysia? again, guessing. versus the united states? >> to some degree, but i actually think the trend is in the other direction. when you look at the total landed cost cap -- >> jargon alert. >> normally we talk about the wage differential between u.s. workers and chinese workers, or more broadly across the emerging

markets, which is pretty wide, but the landed cost gap is every thing else that is measurable. shipping costs, logistics, transport, you combine them together and you are at a 16% gap between the u.s. and the emerging markets. same with in china specifically. most of the consultants are at the forefront of this and say that when you get to that level, particularly if you are a domestic company, there is no more benefit. >> very quickly, cap x on serving companies like charles schwab. what is that, the wallpaper in your office? >> we have a non-us business, but it is for our non-us clients investing with their u.s. dollars, typically back in our markets and global markets. and we are expanding. we are looking at particular decisions to expand. we are however moving some of our service folks away from non-us back to the u.s..

so, we are also part of this on short. >> interesting. without question, 2014, a key issue in sustaining optimism. bonds.ties and again, i will be in washington for the international monetary fund spring meeting tomorrow on "bloomberg surveillance." and on friday as well. from new york city this morning, stay with us, this is "bloomberg surveillance." ♪

>> good morning, everyone. bloomberg -- gasping, excuse me. fu,keene with me, scarlet erik schatzker. liz and saunders is with us. tom davidson as well. we will get to him in a moment on an interesting project that you need to hear about. first, top headlines. >> yes, indeed. china says they will not compromise in their dispute with japan over a series of islands,

this -- depending on which side you take your. the country's defense minister made these comments during a briefing with u.s. defense secretary, chuck hagel, yesterday. he accused china of adding tensions to the region. he meets with the chinese president today as part of his visit to china. arestigators believe they closing in on the missing malaysian airlines jet. search crews have once again signals consistent with those committed from a black box flight recorder. the australian official heading up the effort says that he is optimistic on finding the jet in the not-too-distant future. top headline, uconn sweeps the college basketball championships. tonight the women's team beat notre dame to win the ncaa title. this was the ninth national championship for the women huskies, a record, the victory

coming one night after the men's team knocked off kentucky. uconn takes it to nights in a row. >> staying with schools, in washington this week the president announced more than $1 million in grants -- $1 billion in grants to help prepare students for today's jobs. sounds great, but what students really need is budgeting skills. tom, our guest host for the hour, he has worked with elementary schools or colleges to educate students on understanding money. our twitter question of the day -- do students need to learn financial literacy? or do they just need better math? >> a lot of things around schools make you scratch your head all the time. this is one of the ones that is bananas that we don't include in the daily curriculum of schools across the country. one of the challenges with this is that if you don't learn certain things around english, about certain various topics in

school, it is not as punishing as putting yourself behind the eight ball right out of the gate when you mess up on your finances. things like managing student loans, your credit score -- people get hit like a ton of bricks when they graduate from high school with these things. paying their first time bills, it is just not included in the daily life of students across the country. platforme technology that you use to teach the literacy is new, but the idea of educating kids on this is not. previous efforts have not exactly been successful. what is different this time? like great point. perhaps breaking news this morning? but not that exciting to a 15 or 16-year-old kid. guys likeave to do is me standing up in front of a classroom, talking about how compounding interest calculates, riveting for a 15-year-old. what we have to do and what we really have done is build it into gaming. putting them in situations where

they tear down their credit, build it back up, missing payments, the drama, building a lot of drama. >> you just described my children. >> believe me. makeis what we try to do, it interesting, measurable, test what they knew. talk to the students. they just released a study yesterday that said if you get on them early and you reinforce it with booster shots from year-to-year, there is a ton of cognitive. >> i find acute interest in 'world for kids. the startup world, zuckerberg, all of that. anti-capitalism within our secondary education system. teachers are saying we are not part of this game, not part of the capitalism game. we don't want to teach that in here. is that attitude changing? >> i would pushback on that little bit. teachers are more passionate

than anyone about preparing their students for the next wave of their life. here is what the education system has failed. >> what is that, please. >> if you look at any other major infrastructure in the country, energy, telecommunications, highway systems, there is a thriving private sector that innovates on it. hospital systems and others. education is the only place in the country that i think that doesn't welcome the private sector into the mix. we need to make sure to encourage that, allow the private sector to innovate. >> you got some of the biggest technology titans involved. they are funding ever five. how did you convince them? >> it is not an easy task. i think that what they saw was that we do a number of different things. financial literacy is one of them. we also do cyber bullying protection and other things that schools have a difficult time getting their arms around. i think what they saw was that this is the largest growing

education network in the world. these are folks who are used to scale. they want to do something that is not just around the fringes. >> i would take issue with one thing that you said, corporate america is very much in our schools. take a look at the vending machine in the cafeteria. but a more serious question for you -- does this need to be a discrete field of study? or can it not be part of accounting, for example? reallyd accounting both get you to financial literacy. >> i am not sure that that is a choice that has to be made. we have embedded ourselves in those classes. certain states are requiring financial literacy as a requirement before students graduate. i truly believe that that needs to be all 50 states. it is one of the core things that students should know before they leave. it can be embedded into an existing class, but it should be a long, definitive, 15 hour

course. >> fascinating. tom, thank you. >> tom davidson, thank you. coming up, the share of mothers staying home has climbed over the decade. is it the storage mint, or a choice? next. ♪ -- discouragement, or choice? next. ♪

"bloomberg surveillance." company news, general motors is testing the patience of regulators, failing to respond to over one third of the request for information related to their switch recall, finding g.m.

$7,000 per day as they await answers. sales, seen a surge in the luxury automaker reported a month, fueling a pickup in sales for the next quarter, cementing their hold on the number one spot among premium carmakers, outselling audi by 15,000 cars in the first quarter. a federal judge wants answers from sac capital, asking u.s. prosecutors questions relating to individuals who profited from insider trading activities, set to rule on whether the proposed insider trading settlements are between the fcc and the government taking place tomorrow. that is today's company news. fromnior executives comcast and time warner cable are headed to capitol hill to defend their megamerger today. senator chuck grassley, iowa, is the top republican on the committee, joining us now from washington.

good morning, senator. thank you for stunning time with us. this question is what i would begin with, senator -- do you have a position on this merger? are you favorably disposed to allowing comcast and time warner cable to combine or not? >> i was told this interview is about medicare, but as long as you are good -- we are going into the hearing and you are asking that question, i will be glad to answer it. this hearing is basically to make sure we get all the issues connected with the time warner merger before the public, to let the justice department and the that we are concerned that they do their due diligence. because the decision is going to be made not by the congress of the united states, but i the department of justice and the fcc. that is where it has been, most of the time. congress does not enter into decisions on whether or not a merger should go ahead or not.

we do have oversight responsibility over those organizations. so, we are having this hearing to make sure that they do their job and that all of the issues are on the table and all the stakeholders have been heard from. wesenator, you are right, will get to medicare, so forgive me, it just so happens that comcast and time warner -- time warner cable are a burning issue this morning given the fact that they will be testifying before your committee today. if you don't mind, i'll follow-up russian. the real issue for americans -- senator, i know that fairness is important to you. these companies argue that by combining they will increase competition. many people see a logical inconsistency in that for any number of reasons, but one of them is the following -- combining is going to allow these companies to wield more power over content providers. in other words, the stronger you are as a distributor, interior the cheaper you should be able to buy content. should there be some provision

somewhere that forces comcast and time warner cable, if they are a single company, to pass those savings onto the american consumer? otherwise there is no guarantee that that will happen and consumers will not benefit. >> i think you have to look at it this way. first of all, there is an understanding that 3 million of the customers are going to be given up by one of these companies. i forget which one. the other thing you want to remember is that the way that this technology is developing so fast and furious, what we might see is a decision here that affects time warner merger down the road with new technology and everything, there his whole bit of new consumer concerns that have to be brought up. all whole bunch of new competition and ways of doing things. thether words, 10 years ago things that you brought up would be more appropriate than they

are right now. we don't know about the future. but i think you have got to have some faith in the free-market system in america, that free competition will make a difference. the other thing you want to there is a lott of other competition out there where they are developing content as well. >> pardon me, i have to interrupt and ask you a question about medicare. you have seen the latest data from the obama administration. one percent of doctors responsible for 17% of medicare billings. is that a fairness issue to you? after here is just to get this information out to the public, so that the public can review it. transparency brings accountability. we think that it is going to make sure we have less fraud, abuse, and mismanagement in the medicare system. basically, we are talking about taxpayer dollars being paid out, 77 billion dollars per year.

the public ought to know where that money is going. just like we have transparency on commerce getting participation in the farm bill. >> i know you know we are coming up against a hard commercial break. thank you so much, senator. >> good morning, everyone. bloomberg surveillance, all of our interviews are on our digital platform. look to bloomberg.com for much of that. with us this hour, lizzie and saunders with charles schwab. this is just like a huge debate. >> more moms are staying home with their kids rather than entering the workforce, reversing a historical trend. to what extent is this a result of the recession? jodi miller is an expert on the future of work and trends. she joins us from los angeles.

jodi, there are a lot of different ways to interpret this . some of it is cultural. part of the helicopter parenting. others say it is structural, where mothers cannot earn enough to afford health care. -- childcare. >> the biggest story is still that 71% of women are working out of the home. we don't want to forget that. that is an overwhelming majority of women. while we are seeing some changes, most women are either by choice or necessity working outside the home. for those who are not, what we is aeeing in the study troubling increase in the number of uneducated or less educated women who are not in the workforce. i think that that suggests a number of different possibilities. 71% of mothersid are working outside the home. 29% is a high.

going higher than what we saw during the recession. shift that we see culturally. for those who eventually want to return to the workforce, how do you get people to look past the fact that they were out of the workforce for a number of years? >> that is a huge problem for men and women. recent studies have shown that if you are out of the workforce for more than six months, you are automatically less attractive to employers. that is a general issue that is an unfounded bias. personally, we have hired many people who would be etc. classically unemployed and they are fantastic long-term, loyal, productive members of our team. we are seeing new evidence that our experience is not unusual. >> i want to ask you a direct question. liz ann sonders from charles schwab is with us this morning as well. what does the united states need to do to provide an underpinning and template for women not

making $185,000, 380 $5,000 per year. i don't hear enough discussion about what a woman does taking 60,000 dollars per year. do we do that right in america? or is there another nation doing it better? >> a lot of scandinavian countries do this better. clearly affordable, quality childcare is a big piece of the puzzle. clearly, just more compelling jobs, which come from higher minimum wage and more education. could be policies helpful. minimum wage policies. and, of course, health care. >> what does charles schwab do? i would argue that you are more famous than charles schwab himself. i think you are. what does charles schwab do about this real problem? for women who don't know whether to take their own pair from beijing, or slovakia -- au pair

from beijing or slovakia. >> i only come into manhattan if i have to. i have a home office and i can be there. largely because i don't manage people. i don't manage a p&l. i am reading and writing when i am not traveling. i could do that anywhere. i think that schwab has done an extraordinary job of flexibility and women, beyond just one of the factors of financials determining whether it is worth it. a lot of very senior people are women -- >> are flexible -- >> it is just as important as the financial part of it. >> flexibility is certainly a a key component. jodi miller, we want to thank you. talkve got a lot more to about here on "surveillance." imf meetings be in tomorrow? >> we will go out tonight, there will be a panel with citigroup.

honored to do that panel to get it started with ted truman. >> and christine lagarde? >> tomorrow, on bloomberg television and radio. >> in the meantime we will be discussing what is on our agendas, including ipo pricing. we will be right back. ♪

>> good morning, everyone.

"bloomberg surveillance." erik schatzker is with me this morning. >> hillary clinton says not to expect a decision on a possible house anytimeite soon. the former secretary of state and former first lady is putting off making a decision because she is -- actually enjoying life. she made her remarks at a san francisco event when asked about vladimir putin. she described him as a tough guy with a thin skin. airlines are feeling the squeeze . because of liens, the price of them have gone sty -- skyhigh. the price of limes, has gone sky high. alaska air has dropped limes from their drinks menu altogether. they are selling for $100 per box, up from $22. look at that, $22 in january? i could have made a fortune investing in lines.

bad temperatures and drug cartels have created a shortage of the citrus fruit. the most-watched play date ever. i know you love this one, tom. prince george and his parents stopped in as part of a get-together in new zealand. formalities were cast aside as the top mothers did what toddlers do, getting down and dirty and crawling on the floor. >> he has got that hair. likeey had a picture from 30 years ago, whatever it is -- >> what, william? >> it was shocking, the similarity. it was absolutely shocking. >> what is address? issa? >> tory burch. >> how do you know? >> i was advised on this by our "surveillance" fashion advisor. it was a weak moment. what can i say? [laughter] we go to betty liu, "in the loop," what do you have today, betty? >> are we all frustrated by our

cable bills? comcast, time warner cable, going to the senate this morning where they say -- look, if you merge these companies your bills will go lower and this is better for consumers. others say no way, including arizona senator john mccain, who will be joining us, as will harry sloan. >> did someone die? you are wearing black. >> what are you talking about? >> she lives in new york. of course she wears black. >> liz ann saunders this morning, tend in connecticut -- i love what you are wearing, what is it? >> alexander mcqueen. >> let's go to the surveillance mac monitor here. here is the same fabric that saunders is wearing. 1842, part of what is called a victorian hoax. not a relationship, but a tartan. >> i bought mine more recently than that. >> i am norwegian, not scottish.

>> there we are, what you needed to know. >> crucial. like that would make a nice bowtie. >> i will wear plaid if you will wear plaid. >> yes, let's do it. >> very good. >> you have to watch us for the bowtie alone. coming up, allied financial -- >> i am wearing a kilt next week. >> a kilt? that would be good. ♪

>> good morning, everyone. from new york city, tomorrow i will be in washington. a conversation with christine lagarde. this will be the most interesting conversation as the imf celebrates its 70th anniversary, spring meetings for christine lagarde clouding all of this discussion, russia, ukraine, crimea. look for that tomorrow on bloomberg television and bloomberg radio am a worldwide. >> this is "bloomberg surveillance." our guest host for the hour, liz ann sonders of charles schwab, as well as charles davidson. let's get you some company news right now from the files of "

bloomberg west." apple says they are employed -- entitled to two point 2 billion dollars from samsung. they say the figure is justified due to the scope of the offense, claiming that the infringement covers 37 million smart phones and tablets sold by the rival. intel is cutting half of its workers as the chipmaker slashes 1500 of its 2500 jobs in the country, that job reductions are part of an effort to consolidate operations in asia. they began investing in costa rica back in the 1990's. "the weather channel" is back on directv tom of a have settled their dispute and are scheduled to return today. no financial terms were just -- were disclosed, but they did say they would cut back on reality programming and offer more local weather as part of the deal. good.y front and center, high frequency trading. michael lewis had some important comments last week in the debate. liz ann saunders is with us from

charles schwab. the little guy, that is the basic theme, he does not have to worry about high frequency trading. do you agree? what does the research say? >> we as a firm, chuck schwab, we have been front and center in this debate, for the most part against the most egregious high-frequency trading practices . this well predates the michael lewis book. what they have particularly focused on is stepping. the fact that 95% of high-frequency trades were canceled last year. there were simple things that could be done by the regulators. simple as slapping cancellation fees. if you are a long-term investor, alternately the entire system is not rigged against you, but many investors feel they need to shorten time horizons. like you are such an authority on this. if i do 500 shares of twitter this morning through charles schwab, am i affected by

high-frequency trading? >> probably not. is the worry for america if a bunch of institutions are playing around in this space? >> certainly the high-frequency traders would argue that part of the reasons that costs have come down, they probably would have come down anyway thanks to technology. the whole notion of frontrunning and the potential for someone -- >> and the lack of confidence? >> that is something -- in erik bring schatzker. >> walt and chuck have been out front, they put out a statement last week after discussing high-frequency trading is a growing cancer, critics pointed to the fact that charles schwab, like other discount brokerage firms, cell overflow to firms that then subsequently make that information available. >> payment for order flow and high-frequency trading are being conflated. >> yes, they are.

how does one respond to those critics who say -- how can one from criticize -- >> you do what we have done with is public statements, which first and most importantly explain the difference between what we are talking about with high-frequency trading and particular things, like payment for order flow and liquidity costs that that provides at a firm like a ubs, which bundles the trades. differentwo entirely things. again, what we are really trying to do is explain the difference between them and the advantage to our clients. it was a different thing. >> michael is focused on how regulators have not done much to stop this problem. tom davidson, you went from college to the maine state legislature. you were in politics for a while, then you joined the

technology startup world. you know the public and private sector worlds. i know we are not talking about high-frequency trading with you, per se, at how big of a divide is there between regulators all in problems and the private sector? >> listen, i was a democratic state legislator. >> fullest closure. >> life in the real world has taught me some other things as well. >> surveillance exclusive. [laughter] doing a mcgovern. >> fair enough. i think you can set the policy agenda all that you want. laws as youes many want. but even things like we were talking about, empowering women, hiring -- if you don't have leadership in the company, companies stepping forward and making that the core of their business, the practical reality is never going to meet policy desires of any legislation. i think you are starting to see that happen.

>> the limitations. ok, let's get to the agenda, where we take a look at the stories that shape today. eric, let's start with you. you are going on to host "market makers close at 10 a.m.. >> indeed. with a liking to control of by beingone, -- la quinta taken control of by blackstone, thisalance will be with us morning. >> is that a shameless plug? >> of course it was. i am nothing more than a shameless plug. >> just wanted to be clear. >> later tonight, laquinta prices today, and general motors will be pricing their ipo this evening, part of the treasury starting the exit from the company. >> does this mean the government is all clear? --no, i think they won't they will own 18% if the deal prices sells as many shares as

they want to in the ipo. it is worth pointing out that these shares already trade privately the way that facebook did beforehand. not on the second market, it trades in much larger blocks. this is the public's first opportunity to get up taste. >> what about you, tom? >> i think the imf and world bank meetings. we forget that the world bank is involved. to me it is a toggle switch meeting. it will either be really interesting, with a lot of different comments -- the backstory is always off mike and away from seminars. or it will be beyond boring. >> i hope it is not the latter. >> lagarde is fired up. the managing director has an isency to her -- mostly it the europeans telling the former french finance minister to stop criticizing us and stick to your knitting. it is a really abrupt dialogue

right now between the imf and madame lagarde. the seminar i am doing this afternoon with ted truman is also interesting. it talks about the u.s. contribution. >> we will look for that at bloomberg.com, once they release the highlights. let's get to our twitter question of the day. we asked you all the students need to learn financial literacy or if they need better math. compound -- ask grads what compounding interest is? it is a wall. that's been the experience. the second answer, from one of our frequent guest hosts, most students find applying math to financial literacy boring. finally, it is possible to succeed by learning financial literacy without math, just become a stockbroker or

politician. some cynicism there. tom davidson, you guys provide financial literacy in your platform through schools. have you considered offering it to athletes? they seem to need it as well. >> professional athletes get singled out a lot. they come into a lot of money. closely with the nba, who is very focused on this across-the-board. they have sponsored over 900 of our schools in low income, high need communities. they are focused on not just training the players, but the ground game of students across the country. it is extraordinary. they have players across the classroom -- across the country who work with kids on a monthly basis. it comes to when students in elite colleges, do they need financial literacy more than students at your colleges? >> absolutely. we work across the country. georgetown, stamford, it knows

no boundaries. i could not get into any rate school, so the kwak [laughter] -- -- >> [laughter] davidson, thank you. eric, thank you for filling in this morning. it's always a pleasure. "surveillance" on radio continues. ♪

>> good morning. wednesday, april nine and we are live from bloomberg world headquarters. we have a great program and some great guests. wery sloan is in the loop as

talk about media, policy, and what he is investing in now. we will be joined by one of the leading voices in the republican party. john mccain will weigh in on the proposed comcast-time warner cable merger. and why he criticized the white house's foreign-policy agenda yesterday in a crash with john kerry. much more on that in a moment. here's a look at our top headlines. tech stocks rebounded from a three-day selloff. the 23 ridges silicon valley billionaires lost a total of $11 billion in the last few weeks. a promising sign of the search for the missing malaysia and jet. a ship in the indian ocean has reacquired electronic pings that maybe from the plane's black boxes. one of the biggest recalls in automotive history. toyota recalling 6 million vehicles to fix a variety of defects. none have been linked