at 8:00 thisorts morning. they will ask 300 jobs. -- ax 300 jobs. adam johnson moving to the cayman islands. tax day is upon us. we are live from bloomberg world headquarters in new york. joining me is adam johnson and alix steel. scarlet fu at home doing her taxes. getting us started with a ukrainian mormon -- morning break. what happened overnight. mario draghi said the strengthening of the exchange rate requires further monetary stimulus. and of the words come getting too expensive. -- yetongest stance yes since they began complaining. >> one of the high points was

the french bank with the ecb. he came out and said europe is not in japan. just a start if he could be. issue with the euro trading at 138, the goods are not cheap enough to the rest of the world. >> a backstory. what else do we have? >> a lot of data today. retail sales. business inventory comes out at 10:00. earnings, citigroup. talking a lot about financials. prize winners will be announced at columbia university at 3:00. i am in need of a good book. booke most talked about for the imf capital in the 21st century. a both book. every year there is one. check. data

stocks, bonds, currencies and commodities. we continue friday sluggishness. futures negative for. flight to quality. euro weekends as does the russian ruble. nymex crude still elevated. the second board is fx oriented. the vix over 17. yet in but still 101.70. the ruble near 36 a big deal. here it is back 20 years. they tried to be stable. weaker, weaker. move matters.e we are really up there. what does it mean to wheat prices? >> they are huge. a huge wheat exporter and concerns of unrest.

the cost of four percent white earlier today. -- it won up by four percent earlier today. >> mario draghi worried about the euro. when you are looking at the chart, it is effectively the same story for the ukraine. your dollar is fighting more and more of those. >> you have enough problem as it is anyway. >> he has like 10 in his wallet. over the weekend to scour the papers and looked at the web. here is the front page. the first front-page story is the violence escalating in eastern ukraine over the weekend. meanwhile, deadlines passed for pro-russian militants to leave government buildings. there was an emergency meeting at the un security council last

night. this in a bit.to to me it is job owning. thomas shannon saying lovely things about the germans in germany. have the russian foreign minister speaking earlier this morning saying russia will not interfere in the internal affairs. on the the blame more u.s.. >> who was sanctioned by the u.s.? . senator mccain had a strong comment for lack of involvement. he's oak on face the nation. >> we ought to at lake for god's sake gives them weapons with which to defend themselves. so far this administration has not only not done that but will not even share intelligence with the ukrainian government. i can tell you from my conversations from people in the government, they feel abandoned by us. this is shameful.

really raises the question on what is left to do. the second front-page story, citigroup cutting up to 300 jobs in division handling stock and bond trade. basically the global markets unit. two percent of the workforce in the global markets business. of course the questioning is cannot recover? differenttion and investor needs. that will be a key question when the company reports. jpmorgan has the worst start of the year to the fixed trading revenues construct financial crisis and a quarter that typically does quite well. >> amazon expected to release a

smartphone in the second half of the year. unbelievable. we do not have any details on what it looks like. dude has details on what it might have. more sensors to track what you're beating as you go. >> new york the encore just this weekend. i am seeing a new level of this. ofi am so sick and tired people almost bumping into me because they're looking like this. how do we get five for decades without homes? >> i go hide by the post. but this is a disease. >> it is. what i do with the three dtv? >> you may not need glasses for this. new book is the cell phone affect.

ducking for that. ukraine tock to the give you a briefing this morning. statements by ukraine and russia intensified over the weekend. four killed. richard falkenrath has teddy the tension between the forces. a former white house adviser joins us an hour as we look at the headlines. diplomacy headlines. how much at risk are we that these become forceful, military headlines? >> very high risk. the situation continues to get worse. really no way to get it under control absent use of force by the ukrainian government and that brings with it the risk that they will cross the border. >> i met with an attorney who works out every morning with madame lagarde. what would be your advice? what would the imf need to do to protect advanced story?

>> they need to provide immediate near-term fiscal assistance. they have to do it for foreign-policy reasons. lex to me, everything is sped up. >> normal checks and balances that would go on have to be suspended because of the situation on the ground. >> what is the key distinction between the offense in crimea and what we saw over the weekend. >> are ready part of russia. control over it. this is part of the ukraine. the question is, will it remain part of the ukraine. so that is the key question now. a little historical perspective coming to us from the wall street journal. 1654the first time since when ukrainian contacts four and a fateful alliance with moscow against polish rulers, ukrainians are heading back

west. >> this is brilliant. is senator mccain wrong? in thisnk he is wrong case. he takes a position that is very appealing. if you're not ready to go the distance and alter the military balance, you are throwing fuel on the fire that is not going to go your way. viable does not have a the lee terry solution to the problem. >> help us with your perspective and ian bremmer as well. should use prism we to focus on the x number of square miles? >> i think it is more than the x number of square miles but the overall direction of ukraine itself, the heart of the russian concern. no one in the west wants to see what i am about to say. what vladimir putin is really about is the new --

neutralization of ukraine. something along the line of belgium in a war period. >> i like that. this is before your time. lex i am only 12. an important conversation. chief investment strategist at blackrock. should i have gone to cash over the weekend? >> no, i do not think so. ukraine is a wildcard. a lot of angst. i think part of that is justified but let's look at the broader market. it is down four percent. this has not been a disaster. people are conditioned to an unusually strong market. >> i bought twitter and 63 in early january. i am looking brilliant. , which the biotech index

has been crushed under the math ashe past month and a half, still hanging on slightly up. >> the past 12 months still have huge gains. these are pullbacks a very extended levels. >> is a correction 10% or is it less than 10%? >> i do not think the market can refer to janet yellen fixing this. not think they will rise to the rescue this type. >> every time i he -- hear or see the word hopeful, i circle it. it is a dangerous word to your capital. getting to monday morning news. here is adam johnson. >> we have trapped fun and acknowledge what happened yesterday. golf. bubba watson. his second masters tournament in three years. he shot a three under 69 in the

final round. win multipleo masters. this is worn by on the champions and members of the club. speakond place, jordan and jonas blitz. he would have been the youngest player to win one of the four major tournaments and 80 years. >> i loved it. i do not know why other sports did not do it. .idney crosby likes it is exciting. stay awake. golf to me is beyond exciting. >> there is something kind of zen about it. >> i am alone in this. talking like my dad in that golf

is boring -- boring. the long rumored amazon smartphone may be coming to consumers very soon. phone, to sell your shoes, diaper. we will discuss it. this is bloomberg "surveillance." ♪

>> good morning, everyone. it is bloomberg "surveillance." .etwork coverage worldwide taxing america today. front and center, your taxes and my taxes. adam johnson moving to the cayman islands i believe thursday. taxing america. we will do that all day.

grover norquist will join us. >> how do you prepare your taxes? my answer is gotcha. >> bourbon. >> my husband does it. >> a bit of a copout. 3-d sensors to track your eye movement. the company could ship phones by the end of september, just before the holidays. competing with apple and samsung. david kirkpatrick bloomberg contributing editor and author of the facebook effect. good morning. what heart of this is the ecosystem for amazon versus just selling a phone? >> the ecosystem and the competitive landscape is the way to look at the story. there is a small number of companies that are attempting to have a relationship with us

close to every american is possible. google, facebook, amazon. almost apple, yahoo!. make the -- maybe microsoft and their dreams. trying to keep an ongoing relationship for all kinds of commercial relationships with everybody, you have to have a phone. there is another side of it. i think there is something really interesting that i thought about. you. facebook is down 18%. i had an epiphany on this. of amazon, critique which could be the achilles' heel is the idea they are killing local retail. they are ready have a product i have talked about on the kindle fire tablet. if you really wanted to compete with ebay, paypal, square has

incredible inroads. have a phone with all of these relationships with the americans who shop online, which amazon basically artie has. you can start making more money when they go to regular stores. >> it is brilliant. amazonhat business model is retail stores becomes the place were you pick the thing up, not anymore. >> i think would amazon would like is local resale still thrives. you want, make money, help you, service you. good thing for amazon is they have these incredible economies of scale and could make loans and effectively give them away. about pricing. apple cares about margins.

>> wanted to be the bmw of computer business for apple. >> who should sell him as the most? >> walmart is fear amazon a lot. everybody should fear all of these companies. they all have overlapping ambitions. is android in trouble? at ang? >> just looking statistic comes 16% of americans use google and they try to buy something. more than 30% use amazon. you want into a position where you get into transaction because that is where the money is. >> well i want to upgrade this to an iphone six? -- well i want to upgrade this? >> gekko. thank you. coming up, we will talk about why air pollution may not be the

worst problem to have. this is bloomberg "surveillance." ♪

>> good morning, everyone. it is bloomberg "surveillance." scarlet fu during her taxes. adam has top headlines. u.s. traded the accusations over time within the meetingat an emergency of the united nations security council. russia blamed the u.s. for unrest. the u.s. that russia was behind recent clashes in the region. investigators will the ploy and unmanned summering in the search

for the missing galatian debt. it will scan the ocean floor at 16 hours at a time. this decision came after they stopped picking up underwater signals that may have been from the black rocks. captain america held off a challenge to win the weekend box office. rang up more than $41 million for walt disney. rio 2 came in second. those are your top headlines. speaking on the usual obligatory diplomatic headlines. headlines. the one that really attracts my attention is the foreign minister from russia who says russia will not intervene in ukraine's internal affairs. >> going around the world to

china. thought this was a very important must-read. i really recommend bloomberg you to make you smarter. writing up this morning, if you thought china's air was bad, note cheap and simple shutdown. water pollution likely to persist long after china skies have turned blue. when does this begin to affect change innot one china business. have you seen it yet where water is an issue? >> so far, no. when it affects the overall growth of the economy, talk about more sustainable growth in china, but like everything else, china's timeframe on this issue is very different than most investors. >> i like that. richard alton draft. does the new government have a

different timeframe than the previous regime's? >> i think they feel the problem more acutely than others. air pollution result in the olympics. they could clean up. >> they will shoot you if you do not shut your factory down. >> this is not the only one. the case where the flags -- pigs were floating down the river. unbelievable. >> council on foreign relations. i recommend the classic the river runs black. >> value investing and why growth stocks have completely stopped. we will be right back. ♪

>> good morning, everyone . bloomberg "surveillance." we need a data check. futures make it up to. a lot of this off of the ukraine

headlines. nymex crude of abated well over 103 per barrel. ugly basedeads are off of reports out of the ukraine. talking stocks here. growth stocks have completely 3.5%.he mentum, don the s&p value index, essentially up here today. talking about companies like at&t, exxon. boring stuff but they are good. you remember that movie. value is working. i want to know how you define value. >> there is no one metric. did you look at four or five different things, price to book him a free cash flow. it is probably easier to find what is not value. >> biotech or social media,

other internet names, it is very hard to make a value argument on any of the stocks. >> yet you are telling clients to effectively rotate from momentum into value. what was the signal to you that said you need to do this and do it now? >> derivative valuation. of february you have the growth universe trade a 40% premium to value. >> shouldn't it because there is faster growth? >> it should trade some premium but should not be that high. in the past that has been a problem. a lot of the value trades are supported the momentum trade. once it broke him it created a lot of selling among hedge funds. >> what does this do for the large cap communities. it seems as you get safety play to value play, i want pointed they get overvalued? >> i think you can go much

further with the large-cap names. if we expect an environment where real interest rates start to rise again, generally the large names have been more resilient. you do not get the same compression you get on small and mid-cap names. >> you mentioned hedge funds. a lot of the viewers look at hedge funds as an evil empire. should i fear them in the equity markets? >> i would not use the word fear but you should be aware of what they're doing. 2.6 trillion even before leverage. we have seen this in the past. with the hedge funds have to liquidate, the moves can become very fast very quickly. i think that is part of what you're seeing right now. it long individuals have not been selling. can be a lot of this driven by hedge funds. >> it seems like industrials have been revised upwards.

that seems contrary because it seems growth. >> you are seeing increasing. cash on the books. the other drivers. the age of the u.s. capital stock is about as old as you have ever seen a. >> alix steel would not appear with the questions on commodities. mining and material, is their true value their? >> depends on the commodity. we were talking about exxon before and oil. the oil names look very cheap to me. between the mining and metals and oil, i would rather be in energy names. >> what part of the energy cycle? nothing really new if you think about it. where do you find the new value? some of the older, larger companies. not as a the story is so fantastic.

they trade at a fairly big discount to the market. fascinating as we look at the search for value. another issue out there as well. i am not of just been honest. richard falkenrath with us on the nsa. hardly. i have read a little bit about it. a bug, a flaw. lock att is the little the top of my web browser. what does that do. >> if you are on amazon, the existent means your computer has authenticated.

what the her believe bug does is use them the right code to the company that has deployed this incorrectly. >> michael riley from the news euro. advancing the story. >> they do not usually light. -- do not usually lie. does do is pute the finger on one of the great dilemmas. when you know about a vulnerability inside the u.s. government what is your job to >> what is the cost-benefit

analysis. now they are zero days. they are now escalating much higher into the government to change for higher levels of decision. these are days that were never previously disclosed. >> how often do you change your passport yeah -- your passwords? >> almost like never. >> how often do you change your passwords? >> if i am lucky, once a year. i have a couple. i do not change them if i can avoid it.

if they're really strong to begin with with lots of funny characters and 12 characters, you do not have to change them as often. you see the monday joke there. >> maybe we can tweet the monday joke of the day. what do you think? >> i do not know. no one laughed at my jokes either. no laughingg about matter, tax day is tomorrow. we will show you how your tax burden stacks up against tax burden all around the world. also, twitter question of the day, how do you prepare your taxes? tweet us. we want to know. ♪

>> good morning, everyone. bloomberg "surveillance." with me if adam johnson and alix steel. scarlet fu doing her taxes. where is she, france?

italy? >> that works. behind schedule for the second straight year. unusually cold and wet weather has left fields too wet for tractors. typically this time of year the number is more like 70%. beijing cracks the top 10 in ranking of cities with global appeal. the chinese capital was ranked eighth of from 14 two years ago on the list. this is from consulting firm. the beautiful architecture. the jump in rankings comes pollutions.rd they passed soul in singapore to bring into the top 10. duke and duchess of cambridge tightened their -- tried their hand at cricket. look at her go. the royal couple visited a vineyard where she sipped a local wine dispelling talk she was pregnant. earlier a will or -- they were

urged by an elder to have more children. he said increase your family. >> no pressure there. >> i was stunned to learn that, queen victoria 1869. did not get their 12,000 miles in a couple of days but took months for him to get there. movie the p&l greeted him. greeted him.o >> i appreciate the reference. >> time for single best chart. >> tax day is tomorrow. as painful as it is to write that check, it is a lot more painful in other countries. single best chart looks at what economists call the tax wedge. taxes as a percentage of labor costs. the tax burden is below average compared to the other 34 it

nations. >> belgium is 55. >> i would take chile out of that. bottom dweller. grover norquist will join us in this hour. hecan script right now what will say. the world is coming to an end, we had to cut taxes. i believe the budget deficit has never owed. has the tax policy been better than good? >> the economy has been getting better. the tax policy is the same. too long and complicated. the economy has improved. you see revenue revert back to where you would expect it to be. 18.5% of gdp. >> cbo projects that later on. two or three years, around

2017-2018. you can see growing deficits as far as you can see. >> state the case for the liberals watching why we need a lower dividend tax. the rich guys at their dividends and deserve a 20% tax versus ordinary income. dividends in particular? >> i do not think it is the biggest distortion of the tax code. the broader distortion is you have too much of the revenue focused on a very small sliver of the population. you may agree with upper social issues but when the economy turns down, there are bonuses. people living on the dividends. >> for many of those people living on a pension. they have effectively killed that. facts should adam johnson

move the cayman islands as he is threatening to do? you can negotiate it out. >> yeah right. speaking to the financial services board, very few tax havens in the world. they have all gotten together. grows, theylation need more money. >> i hate him so much we are not on speaking terms. she has eight of them. here and please include the check. >> stay tuned. of the big,guide

the small, the curious and the ugly. everything that has to do with u.s. taxes. we will also be joined by grover norquist, president of the group americans for tax reform. >> what is the value of humanity fiasco we will discuss coming up next bloomberg "surveillance." bloomberg television, streaming on your tablet, phone and that bloomberg.com. ♪

>> good morning, everyone. bloomberg "surveillance." monitoring headlines in the ukraine. a lot of diplomacy headlines. adam johnson, alix steel and scarlet fu off this week. alix steel has company news. >> starting with twitter. it goes to turkey. the bp of global public policy will meet with the turkish government official today. turkey has accused them of tax evasion and accusing them of providing by the country's laws. this comes two weeks after the prime minister band the microblog or before manageable elections. before municipal elections.

for the ceo for cbs. paid 67 million dollars last year. eight percent higher than two thousand 12. the most-watched network in the u.s.. the shares were best-performing among the s&p media stocks last year with a 60 eight percent gain. that is today's company news from the files of bloomberg 'west." >> no one deserves a package like that. the ball out of the park. i just mean, the decade that cbs and the gloom. full disclosure, he draws in david rosen who ran number of the vision for good amount of time. it is the adult networks now. there is a guy named rose on there as well. >> charlie, right? >> he is there as well.

>> just looking at the earnings growth, to your point of cbs, incredible. 75% in two thousand 11. 30%, 18%. >> he is the one who tells cbs they have to talk quietly at the masters. >> no wonder you love him then. of course. >> what if we did surveillance like that one day? getting back on track. this is actually serious. should we cut federal funding for the poetry out loud national final? national endowment of art for high school students compete resuscitation contest. christine matthews of the heart of the application of this. author of the moment of clarity on the new business practices. once again, it rears its head

here. liberal arts is no good. everyone needs to be an engineer. this book was smart. you say no. why do we need a behavioral approach. is we need to understand people can be pretty help all. very few of these things work. the hit rate is pretty low. between 20-30% of new products that come out are successful. >> is it a european view you are looking for? >> my take is denmark is different. are you imparting a european view on the u.s.? >> you tell me. i think the most advanced companies -- countries are americans and europeans. they are taking in that perspective because they are fed up with failing products. understanding what it is like to

be a chinese family buying a car. do they want the same type of automation that we do? that sort of ink. >> what you are effectively doing is condemning the u.s. is not being innovative. what is your point? i am not condemning america. i am saying you can get much and on the r&d spend technical abilities of the country. you have by far the highest level of technical expertise and r&d spend. a lot of that stuff that comes out of that, ads on the phones fail. i think it will be a good idea to find out how we will make this fit into the lives of people. how we will fit it into the diverse cultures of the word -- world. there are many using the layer and lens to find out what it is like to be a user.

to your point of how humanities are important. what is the distinction between humanities and applying humanities. >> look at you now. i am on tv. the point is humanities have been awful at applying themselves. just like visit has engineering, humanities has an ex for humanities. there is a way to be helpful in corporations. liberal artse majors of blackrock casco >> we do hire liberal arts majors. one of the hardest things to -- that people that are can effectively communicate. if you have a degree to help you do that better cap and that is better. with i came to your office

my theater major degree, you probably would not take a second look. high number of liberal arts majors. if you can explain things in a very compelling way him there is value in that. >> thank you for that. really appreciated. the moment of clarity. a good airplane book on getting a new type of consultancy going. caught is a story that my eyes this morning. prostitutes are using a home sharing website to run posh manhattan apartment into brothels. one call girl tells the post an escort service is saving a bundle. they said they are cooperating with the police. if you take a look deeper, the post is reporting they want to start collecting taxes from renters in new york starting this summer. already collecting hotel taxes

in portland and oregon. this reflects how far behind regulation is from the new types of businesses and the economy. trying toe part in fix that. >> someone trashed a rented apartment. orhave you ever used it would you? >> i am going back to the fact that i could barely get into in new york in these prostitution rings haven't figured out. >> off the grid. why hail a cab and deal with peel see when you can call uber? >> i have used airbnb. i go.the first place cheaper and more comfortable. >> i'm so lame. >> you do not take vacation so why would you use it cap go >> hotel lamb cast her in paris. like thank you.

greatly appreciate your equity wisdom. forex report, no wisdom there. rubel -- 236. much more for you including grover norquist. it is bloomberg "surveillance." ♪

>> there is gunfire and death in eastern ukraine. the united states ambassador to the u.n. says, there is nothing grass-roots about it. an hour. reports in at 8:00 a.m. they will ask 300 jobs. adam is moving to the very grand cayman islands. tax day is upon us. everyone.ng, this is "bloomberg surveillance." i'm tom keene. joining me is adam johnson and alex steele. adam johnson does better than good at our morning break. what we have today? >> ecb president mario draghi says that the strengthening of the exchange rate requires further monetary stimulus. saturday marked the strongest

statement by draghi. it is getting too expensive. they want to make their products cheaper. that is why they want to stimulate. sales.m., retail that is the big when i am watching. business inventories. 8:00, citigroup, that is the big one. oats are prizewinners will be announced at columbia today at 3:00 p.m. >> we will start with citigroup. they will cut as many as 300 jobs at the bank. this according to a person familiar with the matter. the job reduction is an effort to trim costs amid a slum at the unit -- a slump at the unit. have a screend that displays what appears to be

three-dimensional images. the user could see them without using special glasses. peugeot rolls out its recovery a bid to return to profitability. their new ceo says he wants to end the practice of selling cars at a loss. lost more than $10 billion in the last 2.5 years. it is amazing. i'm going to make money. that is unbelievable. >> they make pepper and salt shakers, right? seriously, ukraine is front and center. they intensified over the weekend. at least one dead over the weekend. richard falcon wrath has studied this tension. we greet him again, sadly, in this hour. not see secretary kerry

very visible this weekend. >> he was not. the tension will return to international financial diplomacy. secretary kerry has said a lot on the ukraine and has given some support to the crane in government. the people would like a stronger line against russia. it is really not backed up by what government allied governments are prepared to do. when that happens, the white house respectfully ask the secretary of state to step off. the ukrainian currency weak instrument ackley. russian yields move higher this morning. other u.s. politicians were -- >> were waiting in. >> we ought to at least, for god's sake him and give them some weapons with which to defend themselves. so far, this administration has only has not only done that, but they won't share some intelligence with the ukrainian

government. i can tell you from our conversations with people in the government, they feel abandoned by us, and rightfully so. this is shameful. you're talking about financial diplomacy, how far off base is senator mccain? >> they shouldn't feel abandoned, because they're getting an aid package that they didn't deserve on economic merits. they're getting it for political reasons. they're getting it at least to may 25 when they have presidential elections. this is a critical. , but may 25 when they have their elections is when the ukrainian people get to decide what the future direction will be. until then, i think russia will let the ukrainians do their work for them. let the turmoil continue, see how bad this can get. only thing international economic assistance can do is prop them up. >> richard, i want to get your take.

for the first time since 1654, when ukrainian cost x formed an alliance with moscow --" whypolish rulers will the u.s. necessarily pay dearly for this? >> it is something like thomas referring to at the beginning. ukrainians will feel like they were encouraged to take this tough line against russia, but when push comes to shove, they're going to find out that the west really does not have it simply. to put this is what happens to hungary in 1956, czechoslovakia 1968. our support for democratic movements sometimes get ahead of our willingness to deal with the power on the ground. knockdowne the

effects, particularly to the baltic states in the north if routine -- if president putin the threat? >> they have nato forces on the territory. hopefully they are safe. the place to watch next is moldova. it is a country sandwiched between romania and ukraine and is a polyglot country. part of it declared independence with a pro-russian government back in the early 90's. >> for a valuable. i saw your boss, secretary chertoff in washington. looks like you guys are busy. i can imagine how the phone is ringing off the hook. it is a busy week. that and earnings, this after soggy jpmorgan report. a significant positive the bull market.

what have you changed in the last two weeks? >> not so much, tom. over the last 2-3 months, we -- >> what happened? >> it is like a hitter in the major leagues heard now there are two strikes and you're out. you get five balls before you get walked. the rules are harder on the banks. >> sr report that says a game of share buyback is over. do you agree? or will we see the use of cash prop up the buys site? >> i think you will see buyback from jpmorgan wells fargo. and bank ofiti america will struggle. even wells fargo and jpmorgan reported pretty soft numbers. >> what part of that is cyclical versus secular? ina lot of it is cyclical the sense that a year or two for

now, if the company keeps doing what they seem to be doing, which is emerged from the mire, i think you'll see the funds do quite well. >> a construct to me, and this is the talk of the -- peter guber, talking about significant economic growth rushing against the caution. that was one of the back stories of wednesday through friday in washington. >> when we have a strategist come on the show and they talk about having 3-3.5% growth it perks everyone up. is it realistic from your point of view? is a realistic to expect that kind of growth? >> i do think it is. having said that, financials are not the place you want to be because of the new regulation. i would sleep well at night with jpmorgan, i just don't think you will earn much of a return. we're been buying general motors.

>> that is a value play, isn't it? >> you have to believe those earnings will come through and if this recall is not going to kill them. >> you mentioned industrials. that hasumbers for been strong compared to all the other s&p sectors. >> it had to do with less for long time. they really got the expenses down. if you got the 3.5% growth, you'll see that fall to the bottom. >> we have to get it can actually agreement with alix steel out-of-the-way. >> how can the industrials recover when you have a mining sector unable to grow? >> we stay away from the min china is slowing, that means inflation is staying low. low, the fedstays scent. uiet ha

what would kill the data check? check is simple, folks. within this, what do you say to cash? that say i am in >> we're finally getting some volatility. here is your chance. the market predicted eight of the last 10 predictions. adam? >> less ask our twitter question of the day. how you pay your taxes? @bsurveillance. ♪

>> i'm tom keene. , doingpher grisanti better than good in equities. he's looking at general motors verity as a stockholder. shares are on sale, 22% off from the year-end peak. there is a person or a dorf that is off to a two percent. wattana byatt? >> because you're scared. we have to make educated guesses gm will keep their

market share or if people will run from the name because of the recall. we think they will keep their market share. -- they have a bunch of new models of the selling really well. we think they will earn about five bucks next year. how much has changed at management since you were at harvard law? managers talk differently than they did 10 and 20 years ago. will they sustain what seems to be a responsibility? >> i think so, it is profitable. she says that the mistakes are made. they will come out over the next six -- 3-6 months with revelatory things. --hugo long for it and short do go along gm and short dearborn? >> they just put in their

dividends. the government just got out of gm. they're poised for a year of growth like ford did last year. is the auto parts to the moon? bookworm is a good company. >> what do you advise your clients now about monster versus stacks? are you saying shift out of bonds equities or stay in bonds and grabbed the coupon? get out of bonds and move into equities. we think the market has done nothing for about 13 years. ,e are at the end of a 31 year unbelievably secular bond market which is now finally trough in. we think right now the tenure bond is in your head fake is down. we are going to use his opportunity for profit. i got to to talk about bonds this morning.

pretty cool. >> not airlines, but on's. >> will sallie mae go away? >> people are selling in january and april. let's turn it around. coming up, more unrest in eastern ukraine. can rest of the manufacturing another crimea at? stay with us worldwide. you're listening to bloomberg surveillance. good morning.

>> good morning, everyone. i'm tom keene shared with me adam johnson and alix steel. scarlet fu is off this week. with us is chris grisanti. thank you for your e-mails. adam has a top headlines. will deploy ans unmanned submarine in the search for the missing malaysia airlines jet. the subway used sonar to scan

the ocean floor for 16 hours at a time. the decision to use of asheville comes after crews stopped receiving signals. a line of thunderstorms produced at least one tornado in the great plains late yesterday. the twister was spotted about a hundred miles north of houston. the thunderstorm brought hail and high winds across parts of texas, oklahoma, arkansas and louisiana. i was quite a storm. be careful down there. >> at duke and duchess of cambridge try their hand at cricket. royal couple also visited a vineyard were kate middleton said a little wine. >> surveillance breaks loose. has massivedio coverage. you're thinking of going to cricket. >> why the heck not? kateer, prince william and were persuaded by an elder to have more children.

increase your family, tom. those are top headlines. >> assure the don't have to worry. >> what is the graduate program your daughter wanted to go to? 80 grand? >> who can afford that? my princeton tuition in 1988, senior year, i know because it paid a third of it, $18,000. i can handle that. it is the day most americans despise. it is tax day as inch closer to that final deadline on surveillance. we talked taxing america. my question, are higher taxes actually working? the budget deficit will be the lowest in six years as a government rakes in over three trillion dollars. grover norquist is the president of americans for tax reform and a creator of that tax pledge to nearly every member -- every

republican member of congress assigned. mr. norquist, what part of higher taxes is actually working we take a look at an economy where there's no recession, we are adding jobs in the budget deficit is shrinking? >> compared to what? this recovery? has had a recovery since six months into the office. compared to reagan, we are short --eral million jobs correct but a very different economy. >> reagan's accomplishments dwarf obama's. he did it with a workforce that was much smaller. a much larger workforce. by every measure this is a lousy recovery area better than no

recovery at all, but worse in every recovery since world war ii because he took the wrong road every time with one exception. when he agreed to hold down spending with the sequester because republicans insisted, the whole reason the deficit is coming down is that we went from 24% of gdp being spent down towards 20. correct grover, you broken the tony suburbs of boston when the boston marathon will be held in a weeks time. what i see within your good andcy effort is the state local dynamics. i think most of our viewers don't understand that. texas is booming. can you say it is just because of low taxes? >> no, because it is better labor law, better tort law, better tax law. ill series of reforms. you are exactly right. at the federal level, nothing is moving on taxes. in the states, 34 states have a republican governor, republican house and senate. they're cutting taxes and

reforming tort law and reforming labor law. 13 states, california , maryland, minnesota, have complete democratic-controlled. this is a back story of the conversation. federal, federal, federal, paul ryan. forget about it, its about the states. >> it is also about the individual level of taxes. grover, i just want to wish you on this a little bit. the effective tax wedge in the u.s. is 31%. that is total taxes minus benefits. at the oecd is 36%. our taxes are already lower, why do they need to go lower? >> because we need to grow faster rather than slower, because close to where europe is is not where we want to be. we started this country with an .verage tax rate of two percent

we decided we couldn't stand it anymore and the guns came out brutal the british to go away. there's been some backsliding since then. >> chris grisanti, what are your thoughts on tax policy? >> is there any deal which you would agree to, even if you got all your wish list that would raise taxes. >> grover norquist, can you come to a deal with democrats? >> of course. not a dollar in tax increase. the president swallowed it and the economy has done better. deficits have come down because spending has come down. we have had real spending restraints for the first time in a long time. by keeping spending down, the sequester last 10 years now. we don't have to do anything heroic in order to force to mystic discretionary spending to live within its means.

>> stay tuned to bloomberg television all day for special coverage of taxing america, your guide to the day, the small, the curious. everything that has to do with u.s. taxes heard hank greenberg will also be in on the loop third don't miss that. we will be right back. ♪

>> good morning, everyone. "bloomberg surveillance." alix steel has our company news for this morning. china.mart calling out do ase officials need to

better job with food inspections, this is according to the "wall street journal." the chain wants china's officials to hold the country's manufacturers accountable. a big weekend for walt disney. its captain america held off a challenge from rio to at the weekend box office. than 41 million for disney in the second weekend. captain america has now collected $477 million globally in two weeks of release. out a recovery plan. the carmaker will cut its lineup peugeot rules-- out a recovery plan. more than 10ost billion in the last 2.5 years. news.s the days company

>> the french ambassador to the yuan said russia's recent invasion of crimea may be re-created in eastern ukraine. europe, james hogan, legendary and foreign affairs, as one of advisors. now joining us is a political risk analyst with neil intelligence. she joins us this morning. otilia, what are you looking at in ukraine? >> obviously, the situation in where thegion resistance is strongest. the government has been effective in quelling uprisings last week, but it has not kept up with momentum.

of programthe makeup russian ukrainians? who are they? >> we have just seen one of the pleased units changing sides in there is obviously a part of the local citizenry that is a russian. they're been slurred -- very strong suggestions of russian involvement in organizing these -- these protest. >> what kind of intervention ramped up support is realistic right now? , butssian names in ukraine fomenting unrest in spite of ukraine and by challenging the legitimacy of the government in kiev and destabilizing the country ahead of general

elections which is scheduled for may 25. >> we see images of people approaching police stations with if you drill down deeper, what is a risk that there are only just a handful or dozens of people buying these images? >> indeed, this is the main problem with separatists everywhere. they would need to either get the majority of the population underside, which is fairly unlikely in these regions at mrs. te russian only numbers up to 40% of the highest, or get the local elite on this site, which would be the politicians and business elites. they don't have. facing isisk they're a destabilization of the region to the point of actual civil conflict. >> thank you so much. teneo political intelligence.

this reportedly would create a firm with nearly $800 billion in assets under management. this is first reported by dow jones. massive pension -- i don't think i've ever seen this, where a major asset manager is getting involved. >> is expensive to buy an asset manager. it is not a blackrock which is forging ahead with huge growth. no fee not is a backwater bond business. sickassume they have great -- great chicago cubs tickets. >> also, why would you buy a bond shot?

>> bonds aren't going away. greg is going to very billion dollars. futures are flat. >> good morning everyone. you're on bloomberg television and radio. the to all of our digital product. bloomberg radio plus on the iphone. .loomberg tv plus i am tom keene, scarlet fu is doing her taxes in orange county. --istopher grisanti at one of only two u.s. banks unable to make the cut, by the way. bank analyst gerard cassidy of rbcs joining us on the phone.

why is citi still struggling five years after crisis? >> what you have is a large, complex organization that is difficult to manage as easily as a regional bank. that is art of the challenge that this company has. last week that both jpmorgan and wells fargo have lower revenues. we are expecting today from city, revenues to be down 12%. is any reason to buy city at this point? a very we think it is attractive value play when you think about where the stock is trading relative to the tangible book value. the stock is very inexpensive. meaning near term, today and the next 30 days or so, the company could struggle. >> gerard, you are not as gorgeous as meredith whitney, do

you agree with her that there'll be a lot more cost reductions, layoffs and firings at the big banks? >> absolutely. these banks need to continue to downsize. we saw on friday to announce that would jpmorgan. their mortgage business is still losing money from a production standpoint. is going to be in the investment banking and mortgage banking. number?ly, give me a . >> i think it could easily be in the tens of thousands. >> what if they want to boost a 10%? >> this is not the same old citigroup. this is a shock from washington telling them that they still are very unhappy. they haven't broken up. to see we're going opportunities to make money here. this is not the same old the

-- the same old citibank in our view. the number one thing he has to do is be part of the resubmission process to receive the approval from the regulators. second, is to bring down the citi holdings, as you guys know. then we think that is the second thing. >> the red sox were terrible. gerard cassidy, are you loading the boat on banks? >> absolutely. i think this is a great opportunity. >> i need to cut your because of the time. christopher grisanti, you don't agree, do you? >> we have different styles. in the wake of the 09 crisis, we just like gerrard was saying. half the tangible books. >> back to you, gerard cassidy.

to those cautious on the financials, how do you respond to that. >> tom, there's one last leg up for the banks. is eight yield curve and rising. possibly we will see both over the next 12 to 18 months. >> gerrard, the upset on these banks, 10% or 15%? today to can move from that point. we think 20-30%. followed.dely discount, aing at a marginal discount. >> it on think there is a much greater than market return in the banks looking forward. we have made over 100% over these banks in the last three years, let's not get greedy. >> instagram is on a roll.

you're asking smart questions, i am doing instagram. ♪

with adamm keene, johnson and alix steel. betty liu joins us right now. >> i hate doing my taxes. who likes doing taxes? >> this year i got a $167 refund. >> hey, judging. someone is spending the cash. hank rittenberg is going to be joining us -- hank greenberg is going to be joining us. he isn't going to be speaking about his own taxes, how much he pays or doesn't pay, but corporate tax reform. he says if there's any time to get tax reform done, this is the year. click this is very interesting.

>> curious that this would be the year in an election year. curious. you ask mr.- can pozen what this means to boston? know -- i would be honored to know what he thinks. >> lots of heartwarming stories of survivors. overseas,pside, going are you guys cricket fans at all? >> yes. >> come on. to singapore and comes back a cricket fan. now they're trying to really focus on soccer or football as the college internationally.

img has just sold eight franchises in india. the loop with betty liu at 8:00 a.m.. starbucks chairman and ceo howard schultz sat down with charlie rose. here's what he said about a new tea in stores, coming soon. we're sitting at a friend's wedding. authentic and real. we have always dreamed about doing something together. never really did find it. i think her values match ours. i want to do something to elevate t, but at the same time tosomething to help people afford education. oprah chai is going to be in stores. i think is going to be big. >> you can get that full interview tonight on charlie rose. here's the question. if tom drinks that t, does he have to do yoga?

he's arching his back. chai.ah >> is interesting that he is talking about seed because of coffee prices being higher. -- talking about t because of coffee prices being higher. >> citigroup earnings, we will be right back. ♪

>> the morning, everyone. "bloomberg surveillance." i'm tom keene. alex insists that we speak commodities. she had to go out and find breaking news just to justify. she has company news this morning. >> it is taking websites hit hard by securities. to websites scramble to patch your systems. many us to rent -- many underestimated the time and cost to restore user data. aboutonves as was paid $57 million last year. eight percent higher than 2012. cbs is the most watched network

in the u.s.. amazon may release a smart phone in the second half of the year, this according to the "wall street journal." user could see three-dimensional images without special glasses. this is from the files of bloomberg west. here is what we can tell you. a 61% premium. glencore was in the news over selling its peruvian mine for 5.48 billion dollars. this is the sort of glencore xstrata rebalancing. >> from your view from 35,000 feet, due mining companies have

the ability to cut costs? >> not anymore. there's not more to cut. there's only so much you can do unless metal prices wind up recovering. >> look at this. it is in chat. >> what you're saying is a relatively small company, right? about 1.3 alien dollars. it trades in london. >> it has been a week since flash boys with michael lewis. chris grisanti is with us. have you read the book? is an esoteric subject, but he did a great job.

>> the mcgeady chance to talk your book. -- evenunts everybody harms everybody, it harms us. we make a position and hold it for five years. maybe it harms us the day we bought it. -- not to us.lost they just said don't kill the baby out with the bathwater. , there are two issues here. which michael lewis in his book sort of addressed. on the one hand you have entities that trade faster and more frequently. on the other hand you have orderes that are buying flow. that is where the conflict exists. >> another way it hurts all of us, tom, is it undermines confidence in the market area

and that can lower the pe for the entire market. if you think it is rigged, you're not going there. >> to your clients think is rate? >> after the 08 crash, i would've laughed at you five years after you said that. >> did you framework a single digit frame work? can you be more enthusiastic? >> i can be more enthusiastic than that. if you look at the last 13 years, it is way subpar. era like the late 90's, where multiples will continue to continue tofed will be very accommodating as long as the economy is mediocre. i think we can easily do north of 10%. >> what about asia? think the risk of war is

wonderful right in the united states. the economy is growing. the oil revolution and the factory revolution is all happening here. we have much more transparency than any of those places. >> you must read and -- most recent quarterly letter, you said this is the most i've made in a single quarter. what was a catalyst? >> it was the return of volatility. investors think they want straight up and that is lovely, except it is incredibly difficult to get new money. in january the market was down a thousand points and we bought six new investments. >> woodcut of volatility do you think we will see in that half of the year? >> i think this is a more typical year. last year was the least follett: 20 years. volatility is back. >> is vix a good indicator of volatility? >> i would like to see it above 20, which we never saw.

>> but would need to happen in order for that? >> tanks moving across the border. a tech fund selloff. typical. is not a scary thing if you realize that it happens to her three times a year. >> there have been 10 dips over the past two years. each has been at least one week and has gone down anywhere from -1.9%. >> ukraine is front and center. chris grisanti talks about tanks, even without the drama. what i would notice is a linkage of financial into the more drama, the military. is thel message

financials have deteriorated. that is the backdrop. that is what i heard from the eu ministers at the bloomberg news bureau in washington. the backdrop is the finances, getting the headlines that we're financialt of -- >> diplomacy is what we really need to see in the ukraine now is what i am hearing. >> russia holds one third of the short-term debt of ukraine. that is coming due in the next two years. >> it is fluid, to say the least. >> citigroup is on my agenda. the bank reports earnings in just about five minutes. of themes on the heel announcement that it could cut up to 300 jobs in its global markets division. a couple of things will be important area of the first is going to be fixed revenue rates. we said jpmorgan's revenue come in at the lowest level since

before the financial crisis. get a lot of exposure into the emerging markets which makes them a bit unique when it comes to big trading. it is also about cost. yet the reason mission, the struts test -- the stress test. ever koran particular is looking for a management roadmap. the king for a lot of clarity and how they're going to solve this problem going forward. and citibank, those are two terms are don't normally associate -- associate with each other. a couple of stats to come to us from the irs. i find this fascinating. in costs the irs $.15, whereas paper cost the irs $3.50.

>> the red sox are in last place, the yankees are in first place. you a lot to say that. i salute you. we want to point out the fact that we have special coverage today, network coverage. your guide to tax day. all day here on bloomberg television. keep the volume up very >> we ask you how you prepare your taxes. tom said it was electronically. >> no, scott. , a pencil and a dash of imagination. >> turbotax. i used it once, but it didn't get back as much as i should. >> baileys is more nutritious. thank you so much. there we are.

aloomberg surveillance" on monday. i am heading over to bloomberg radio with michael mckean. stay with us all day. good morning.

>> we are alive from bloomberg headquarters. loop." "in the

i am betty liu. ignoring a deadline for them to meet government buildings they've occupied. millions of americans are racing to finish their tax returns before tomorrow passes deadline. have you done yours? we will try to make it easy to you today. looks like the trading has led to a job cut as citigroup. it handles bonds and stock trades. up just right are now. little bit above estimates of the dollar 14 on the streets. >> in terms of adjusted earnings per share, it was better than the average analyst estimate. analyst