>> from bloomberg world headquarters in new york, i'm mark crumpton. this is bottom line. today, carl icahn tells bloomberg television the real reason behind his truce with ebay. g7 finance ministers meet to discuss ukraine eight. stephen cole bear is replacing david letterman as host of cbs's late show. bert.ephen col to our viewers here in the u.s. and those of you joining us from around the world, welcome. we have full coverage of the stocks and stories making headlines today.

megan hughes has the latest on efforts to locate that missing malaysian air jet. our foreign-policy correspondent follows developed in ukraine and russia. we begin with trish regan. the few that at ebay comes to an end. >> i'm joined right now by mr. carl icahn himself. gots a bit surprised when i this news because i know you have had some pretty choice words for management and some of those board members. it now, it seems as though you are coming to an agreement. what made you change your mind? >> i look at all of these pieces. ,f you look back at our record when we got on board over the five years, all you had to do was buy the stock and you did confidentiality

. we did terrific on those. on an annualized basis, if you just bought the stock when we board --n the >> i know you wanted to see paypal being spun off. are you going to continue to push for that? -- we believe -- that ebay should eventually be separated. after talking to john in setting this company, i think there is such a huge potential in paypal right now that it's almost a mistake to do it right now. i agree because, why shouldn't they sell stock now when you believe it's going to increase dramatically over the next few years? paypal is a bit -- i like to

call them no-brainers. it's a little similar to what we said with netflix. said spinning off paypal was a no-brainer. what exactly made you change your mind here? several weeks ago, you had not spoken to the ceo. it seems you did have a conversation with them. how did that come about and why doe? >> you have asked similar questions. so many questions. with what we talked a lot. have lived with this company for a number of years. a lot of them don't want to see it split up for the following have a-- a few of them

feeling that at this point in time, why split it up? -- we are not short-term investors. 7-10 years is the new mantra. the reason they don't want to do it is they feel that paypal will be taken away from them. will come inquirer and pay the premium. they are not interested. this thing has so much potential, why do it now? i think, i'm not speaking for think hehoe, but i also has that same thought. this company is really cheap now. , i can'tdig into it grasp that thinking. -- you don't off have to do it now. i believe the question is not if

it's going to be done, but when. -- if you know you want when, why fight the war? >> did you know you weren't going to win? >> first of all, you have the chairman voting with eight percent. have great belief in this company and the potential and i don't think they would have voted for me. i might have won a seat on the board but i would not have won the preparatory anyway. it is easy to change her mind when you are not going to win. mind when you are not going to win. >> i want to make it clear, i don't say i would not have won a seat on the board. i say that strongly. i do not believe i could have won the preparatory anyway, so it's easy to change your mind on that. the company will be

spun off eventually. i still believe it should be. i don't think there is a rush to do it. >> we going to stay into the stock until it spins off? >> i do stay a long time with companies. i really think this company is greatly undervalued. i have said it the other companies i'm in. i believe apple is undervalued. i think this company is very undervalued. you can deduce from that that i will not be selling it. i might be buying it. >> david dorman is the independent director that has been named to the board. how can he become switzerland

here? -- ihave said this before was having a conversation with -- we were talking about some other business. said,ught up the fact, he he is a smart guy. why don't you start talking? i would love to talk but he never reached out to us. you don't like to make the first move in these things. i was not sure that john wanted to talk. he said, let me call him. said, yeah,hn who great, let's discuss this. that,e up with this idea ok, why don't you put a third guy on? that appealed to me. -- i thought i

might win a seat. they agreed they would give me a confidentiality. david dorman -- he saved motorola. i think he would be a great director. they like him. and had aave conversation and he agreed to be part of that confidentiality. -- i'm lockedn in. i'm not a short-termer. you can only buy and sell occasionally. you have longer restrictions.

jimmy is a good guy. of analysts,lot they thought john was an effective guy. john and i must have talked over 8-10 hours-1for about the company. was interesting -- not everyone is so outspoken against you. this particular ceo came out and was on the program with me and he came out swinging. the company came out swinging, firing back at you. did that have. anything to do with your decision? >> was on that program with you a long time ago. i don't even remember that program. i did watch it. i don't even remember what he

said. >> those board members were out there fighting back. did that have any influence? >> that had nothing to do with it. first and foremost, i want to make money for the company. this is the best way to do it. i don't think anything has changed dramatically about my views. john --speak for >> let me ask you about an op-ed in the paper the other day. saying thatfounders activists are a group of bullies that relish a fight. it would on to say, it is reminiscent of joe mccarthy hiding behind patriotism to inflame the communist scare.

what do you say? >> you are being a bit unfair about that article because i did read it. they said some wonderful things about us. they were talking about activists doing something -- it was the day before we did this. we were talking about motorola and how we helped saved motorola. it went both ways. i can't argue that there are some activists that are short-termers. that doesn't mean that all of them want to bully. i don't think they are speaking necessarily about one or two activists here. if you look at us, we have made hundreds of billions of dollars for shareholders. how can you say that we just look out for ourselves? yes, i would argue that they are

wrong about that. i can't argue specifics. they also said -- i read it thatully -- they also said large shareholders, index funds should not be that passive. they should be much more involved. >> they said the analyst community -- they were calling on every one to be more active. you have been very active in a company we have followed quite closely. ackman says he is not going to stop until the companies out of business. he has seen some success in terms of getting the fcc to take a look at this company. they launched an investigation. what is the latest on that? i know you have three board members and have stayed inv olved in this company. >> we went up to five board members just recently. we are involved because we like it. i have said all along that they

got this completely wrong. this company is undervalued. herbalife gives jobs to people. it is absurd what ackman is saying. thesis is piec completely wrong. there are things he says that defy -- there are some of these distributors that might be promising stuff, but that's not herbalife promising. they have done a great deal to change that. go in and say, we don't want you to sell leads. that doesn't mean herbalife itself is not a very exciting company. it is in a market that gives jobs. the opposite of what ackman says. they give jobs to a lot of hispanics. i can't even understand his arguments. read it if you want to.

i think i'm the only guy who loves to read the first report -- he may believe what he is saying. i don't know. i'm not mad at ackman anymore. i made $300 million because of ackman. you have been so active in apple this year. herbalife has caught everyone's attention. can you give us any hints at what you are looking at next? >> no, i can't. i will leave it at that. >> you know i will try. >> you have to ask, i know. >> carl icahn, thank you very much for joining me today. talking about the reasons why he is dropping his proxy fight with ebay. >> thank you.

trish will return at the top of the hour to speak with bill gross. we will get his reaction to the bloomberg businessweek cover story. up, look at what russian president vladimir putin may do next to show the west he is not budging on ukraine. ♪

ministers atinance the imf world bank meeting in washington are discussing more aid for ukraine, russian president vladimir putin is threatening to stop gas deliveries through the country. this latest threat from a scout -- is it his biggest economic trump card? >> it is certainly a big one. ukraine is dependent on russia natural gas. if he is talking about cutting off their supply, this is not a

huge problem now in april when it's warm and they have this supply built up. in january, it will be a major problem bb of seen in the u.k. -- he isprices pressuring the european union saying, you need to take action to make sure that ukraine's economy gets back into shape. there economy has contracted twice since 2008. here, is facing another recession. he is telling them to do something about ukraine's economy. we have done too much already. gas supplies to ukraine, he is also cutting off important pipelines for getting gas to the rest of europe. there are some alternate routes. it is not an emergency at this

point. it is a way of him flexing his muscle and saying, it's not just you. i can also use sanctions. othertalking about possible sanctions against russia. what can they do and whether than $20get the more billion package that ukraine has asked for delivered to them from the imf before the end of the month. ofthe west is accusing putin the unrest in eastern ukraine. seen that the u.s. has made it quite clear that they are not going to go to war over ukraine. the question is, what steps happen from here? putin has made it clear that he wants influence over ukraine's future constitution. he has pushed them to something like federalism that would give

the individual governors more power. toaine says this is a weight try to split up the country and relive from next-door. they don't want him influencing their constitution. the next step would be some sort of annexation of the eastern region. the worst step of all would be an outright military invasion. i don't think he's going to go that far. you never know. the west has made it pretty clear that sanctions are right there on the table ready to be used if he steps up his actions. at this point, the u.s. is focusing its attention on trying to help ukraine. them.rengthening >> the latest on negotiations over iran's nuclear program. how's it looking for getting a deal done by that deadline of july 20? of the partiesll involved have been very positive about saying it is possible to get a deal within that timefram

e. and european leaders are being a bit more cautious now in saying that were cast to accelerate to get a deal i july 20. the gap between the two sides is really large. it is something that has not been resolved in 10 years. makes thell of this whole controversy over iran's pick for its you when, who has s been involved in the u.s. hostage takeover at the embassy. there saying he is not a viable candidate and iran is saying you can't reject him. >> thank you. equity sellout in the markets at this hour, especially the nasdaq. we will have an on the markets update, next. ♪

>> it is 26 minutes past the hour. that means bloomberg is on the markets. let's get you caught up on where the markets are trading. markets are down across the board today after reporting gains over the last two sessions. investors are selling up shares biggest gains last year. a couple of individual stocks are watching -- versus gm. the automaker taking a $1.3 billion charge in the first quarter. the car isounced being recalled over the ignition switch will also have cylinders replaced. we're keeping an eye on the

pharmaceutical company. more on the markets in 30 minutes. bottom line returns after a quick break. ♪

welcome back for the second half-hour of bottom line on bloomberg television. i'm mark crumpton. let's check the top stories we are following for you at this hour. the number of people seeking unemployment benefits in the u.s. dropped to the lowest level in almost seven years. week to a 32,000 last seasonally adjusted 300,000. few americans sought benefits last month. applications are at their lowest levels since may of 2007. house committee has voted to hold an irs official in contempt

of congress. headedicial previously the irs to vision that processes applications for tax-exempt status. after providing an opening statement, she refused to answer questions at a house oversight committee hearing about irs agents improperly singling out tea party applications for extra scrutiny. she refused to answer questions at a hearing in march. the bonds returned to market. the greek government sold or $.2 billion in bonds. more than it expected. since 2010 greece has been bailed out twice. the country got more than $300 billion in aid from the international monetary fund. we will have more on greece tomorrow with nicholas, professor of economics at the nyu stern school of business. he has advised governments of some major european countries.

the insider trader settlement has been approved by a federal judge. this caps a decade of government probes into insider trading. joining me now from washington, seth, welcome back to bottom line. >> great to see you as well. >> can both sides claim victory in this case? >> sure. both sides can claim victory. wall street and the atmosphere of trying to instill confidence back into the american retail investor is a bit of an open question. prosecutors got a good deal because they have in his store to $1.8 billion resolution to this case. has beence department going sac capital for a decade. they were able to close it. only able to pay

something that he can afford, but he is able to walk a way a free man. plea, does itlty adequately punish the principle of sac capital? or has it been sidestepped in favor of throwing some underlings under the bus? ofthat is the core question the day and a great point. at the end of the day, if you step back on this the stork theyt, you could argue have fried the fish that missed the well. you have people like matthew mark toma and others who either pled guilty or fought to the bitter end and lost. surprised at matthew marotoma. not disclose the contents of that critical summer of 2008 phone call tha.

based upon that, the statute of limitations for insider trading was missed with regard to steven cohen. you had the basic architecture that ended up with a divergent result. they did close the doors but missed stephen cohen. >> what does today's action mean for the justice department? what about the size of the monetary fine? what message does that send to wall street? >> it sends a mixed message because you have these individuals who are the underlings who get thrown under the bus. if they get ripped away from their families and thrown in jail and go away for years. sells a few rare paintings and pays a fine. he can afford it. then he goes free. they changed the name on the nt 72-- now it's called poi and he goes free. this is a historic moment. the justice department's able to

without a victory. iis bittersweet for the justice department and wall street. cohen?t about stephen he is the subject of an administrative proceeding. if there is a culture of malfeasance starting at the top, why did they not charge him? >> they cannot get the evidence to have a solid case against him. a was the chance to close that deal. now he goes to jail -- all you have left against stephen cohen is a slap on the wrist for failure to supervise. which is basically a glorified employment case. he will end up settling that. when you have criminal cases, the administered proceedings are safe. he will get back in and settle it. you have very divergent

situations that are going on here. it really is not only a historic day but a day at mixed messages as far as compliance and wall street is concerned. gavee former sec chairman a compliance lecturer to sac capital employees. in a recent interview with bloomberg news, he said the following, "there are only two sorts of people who cheat under circumstances like this. the first can't do it honestly and to the second are sufficiently arrogant to believe rulesone of societies' apply." >> look at what happens today. big money one. the thing that is interesting about the article is, it's a great point. in that story, he talked about the instance of the training program. they had people that when and. guess who did not show up? stephen cohen.

it is so fascinating that you point that out. brings it full circle. he did not show up. the culture of ethics starts at the top. i think you clearly have mixed messages on what is really a very historic day on wall street. partner joining us from washington. seth, always a pleasure to have you on and get your expertise. thank you so much. ising up, stephen colbert named as david letterman's successor on the late show. ♪

>> this reminder at the top of the hour, trish regan speaks with bill gross. we will get his reaction to the latest bloomberg businessweek cover story. that's on street smart, coming up in 20 minutes. researchers are racing against time to find any remnants of

malaysian flight 370. the reason, the waning battery life of that black box. an australian plane has to a possible signal in the area where the pings were hurt. .- were heard what is the next step here? >> the next step is underwater robots or summaries. they are continuing to try to narrow down the search area. they have 14 aircraft to my 13 ships on the hunt, working around the clock, trying to find these pings. rd a search plain hea possible signal. they are still looking at that signal to see exactly what it was. it is in the same area where the ocean shielded ship lusted earlier this week. the locator picked up for signals believed to be from the planes black boxes. ger locator 25, the

same technology used to find the air france wreckage. they picked up the sounds twice this week. once on saturday and months on tuesday. each time, it was believed to be bullet flight data and cockpit voice recorders. .wo different pings the reason they believe it was the black boxes and not another underwater noise was the frequency outside the range of human hearing. tempe.a once a second very specific. the clock is ticking. they do seem to beginning weaker. the once they heard were around two hours. this has been going on since march. out pingss only send for 30 days. >> how tough will it be to get to the wreckage? >> that's why it's so important

for them to narrow the space down as much as possible. deep we arek at how talking about. from the top of the ocean, going down 828 meters. that's about the length of the tallest building of the world. double that come go down another thousand meters. you go down another thousand meters -- that's where the titanic was. that's where they found the air e wreckage. it took two years to find. at 4500 meters, that is how deep operate.t can anywhere from 4500 meters to 5000 meters. it is my understanding that that ocean floor is like mc. there is a chance that some of the wreckage could be buried,

making it very difficult for this underwater robot to even take pictures. it is certainly going to be a challenge. >> megan hughes, thank you. it is time for today's latin america report. a world bank report says economic growth in latin america and the caribbean will slow this year. the reason, commodity prices will remain flat or drop on the deceleration in china. in economy will climb 2.3% 2014. after expanding 2.4% last year. that would be less than half the pace of growth in the years before the global financial crisis in 2008. quarter sales that matched analyst estimates. france's largest retailer is focusing on price and salesience to strengthen in europe, latin america and china. winning selling a stake in its brazilian it until next year.

selecting no time in stephen colbert as the next host of the late show with david letterman retires. jon erlichman joins us now from los angeles. is let'she scoop here move this pulled the trigger on this quickly. >> we're talking about seven lettermanen the retirement announcement and this deal coming together. a five-year deal -- a lot of people are looking at stephen colbert. why is he the right fit? one of the reasons might be his contract. expires with comedy central parallel to david letterman's contract which will expire in 2015. it was letterman who said, without expiration, it will be time for me to move on. we're talking about somebody who has done an incredible job in building his audience on his

own, away from the daily show bert reportol started in 2005. while he might be older than the of the new heads of late-night, he does get that youthful demographic. the late-night shows are still in a really important part of the network story. to get people to tune in at a time when they are not watching as much and to be able to get .igital bucks that video that gets shared the next day on social media. >> it struck me when this announcement came out earlier today. stars havel of the aligned at just the right time for stephen colbert. to contract will be coming an end within the next year. he's one of the most popular comedians in america. he is a best-selling author. what can this gentleman not do? the marketing machine at cbs

must be cranked up. one of the big questions initially was, when the announcement came out, would he be bringing the persona to cbs? they have confirmed he won't be. will see a big dialog surrounding, what is he like when he is not playing the character he plays? we will have to see on that front. cbo spoke today about the next part of this or a. there is no other show that follows the late show. it was suggested that we might be seeing a change there at some point soon. people toa lot of consider for a position like that. still a lot of moving parts on this story. it is a fun one and a big one.

jon erlichman, thank you. the secret to becoming an arm wrestling champ. hot shots is next. ♪

we're at the lows of the session. you see nasdaq is down nearly three percent. to hundredial down 205 points. as time for hot shots. a look at some of the most compelling images of the day. those who think that walking to the office is just too much work, there is a solution. heel.ir w it was among the hundreds of devices on exhibit at a gadget show in the u.k.

in australia, the big guns are out. australia's biggest biceps made a beeline to the northern territory for the region's first ever arm wrestling championship. participants say diet is key. one competitors as cet 18 eggs a -- one competitor said he eats 18 eggs a day. there are competitions for the right and left arms. forget about captain america. batkid throughout the sermon the first pitch for the giants game this week. he is on treatment for leukemia. the make-a-wish foundation fulfilled his wish to be the cape crusader for a day, rescuing san francisco from the riddler and the penguin.

stay with us. another check on the market movers is on the other side of the week. bottom line returns in just a moment. ♪

>> get the latest headlines at the top of the hour on bloomberg radio and streaming on your tablet and on bloomberg.com. that does it for this edition of bottom line. i'm mark crumpton in new york. on the markets is next. i will see you tomorrow. past the hour which means bloomberg television is on

the markets. let's get you caught up on where stocks are trading. we're seeing a selloff on wall street. stocks are trading at session lows. the s&p is falling by the most in two months. erasing gains from the last few days. the nasdaq falling by nearly three percent. time now for today's report. contracts the utilities, itch are a traditional -- hit a new 52-week high earlier today but has since turned around. , it is down six percent in today's trading. trending in the red today -- trading in the red today -- what's weighing on the sector is mark friedman. you're a happy guy today because the weather is nice outside. late, but greatness. finally some spring buying going on. reportingf retailers

couple sales growth today. -- comfortable sales growth today. >> easter came late this year. we're seeing negative, but better than planned. we're seeing a lot of promotions. cap comes out after the close. -5oking for a negative 3 decline. a lot of struggles. >> why banana republic? >> they have not figured out we're they need to be today. but we will see some changes as they continue to push the international business. next week, there is an investor meeting and we are looking for them to put a spin on it. has been struggling. how will they turn that around? >> get a new ceo and merchant.

they have struggled in doing a couple of key things and getting product out to the stores without some issues. we think they are making changes. he will see that started around this fall. >> are they capitalizing on this trend where workout gear is casual for everyday? >> they have led to that come especially with the women. they're offering works very much from starbucks to the gym and back. people have adapted to that. >> we've seen a lot of retailers tarkdown to ge people into the store and buying. >> the easiest ways to cut your inventories. if you cut them too much is, you don't have enough volume for your store. that way people come into stores and see the bestsellers and they need to buy them at full price. it is a risky proposition. >> nobody wants to go to an

empty store. any surprises that you may be anticipating on your end? >> the biggest thing we're looking for is when does the sector fix itself? is probably the area where people are expecting negative trends to continue for the spring season. >> are there too many teen retailers out there? >> there is a lot of competition. it is really tough out there because they all have somewhere 0-tween 3-800 stores - 300 800 stores. ♪

>> the tech selloff is back. as stocks drop your -- here. i'm trish regan. "street smart" starts now. ♪ >> welcome to the most important hour of the session. we have 59 minutes until the closing bell. coming