>> from bloomberg world headquarters in new york, i am mark crumpton. this is "bottom line." intersection of business and economics with the main street perspective. searching the most since 2012. the congressional budget office global is the projected costs of obamacare. and, a look at tax preparers who take advantage of low income clients. to our viewers in the united states and those of you joining from around the world, welcome. full coverage of the stocks and stories making headlines today. looking at the role in the gm

technicians which investigation. peter cook reports on how the health care law is helping to bring down the deficit. bringing with michael -- starting with michael mckee on details of the stronger showing for u.s. retailers and 18 months. >> good afternoon. good morning. we sell retail sales rise more than expected. we have not we might see a good month but no one thought it would be quite this good. 1.1% increase overall in retail sales. auto sales up a lot, 3.1%. the report was strong all the way through, even discretionary items like eating and drinking places saul an increase. saw an increase. gdp much stronger than forecast. we thought we would see a half percent increase. instead we see .8%. while it may be not enough to do the first quarter, the second quarter starting off on a strong

note. >> there has been a lot of talk about the weather affect at work . you see the hand of the taxman as well. >> the weather has gotten better. it is tax refund time. stronger --g stronger tax refunds. last year depressed by the fact that week ended the withholding benefit from congress. now running $40 refund in terms laste average higher than year. money that will probably go directly to the economy. as electronic filing continues to become the way of choice for most americans, we see refunds go out earlier, up from what we saw last year significantly. is this the turnaround in the economy everyone has been waiting for? >> too soon to tell, but looks like we're making progress in the right direction. not only the weather and taxes

but starting to see income start to rise. non-income personnel seeing significant wage gains over the past couple of months. if that trend continues and continue to seek strong job growth, we could see the economy take off this year as a lot of people have forecasted. >> michael mckee. thank you. more on retail coming up. david strasser, managing director in retail analyst with janney montgomery scott joining me in about 10 minutes. make sure to stay with bloomberg all day today for special programming on everything from the future of the mortgage deduction to how you should handle your bitcoin products. taxing america all day today. coming up later, i will speak to the senior research associate at the urban institute. we will focus on how mom and tax preparation stores are cheating unsuspecting clients.

new is coming up at 2:40 york time. the federal deficit is falling again. the congressional budget office year.evised for this also dropping the price tag for the affordable care act. peter cook took a look at the numbers. the deficit picture seems to be improving once again. term.roving in the short the long-term outlook not quite as bright. the new deficit number for this 400 $92ear, going to be billion. put that into perspective. that is about a third lower than last year's deficit of 680 billion. down more than 20 million from the forecast in february. why the improvement? namely lower outlays for discretionary programs in net interest payments. as a share of gdp deficit will stand at two point eight percent. lower than three point one

percent of the past 40 years. the long-term picks are not nearly as encouraging. the deficit is expected to be even lower in 2015. then it will start to rise. up to about $1 trillion per year starting in 2022. the escalation and federal health care spending at the top of the list. warning of serious negative consequences of washington does not deal with the long-term issues. rightnow no indication that the sides are prepared to sit down and negotiate the bigger budget deal. new numbers for the health care law. that price tag dropping. >> and the short-term it is dropping. the congressional budget office now tells us the 2014 net cost of obamacare will need $36 billion. that is down $5 billion for what they said in february. the tenure price law -- price

is coming down. also upgraded information with regards to enrollment. there are projectionist 6 million all will be covered on average by the exchanges over the course of the full year. measuring differently than the administration which told us just last week the number is at 7.5 million people enrolled. in terms of how many covered, 80% of americans would be covered. 84% in 2014. 89% by 2016. a white house is hailing this as good news. >> this is historic rye grass and shows how the affordable care act is working as it was supposed to, by helping more americans get coverage while making historic progress. >> one other number in this

plan, the price tag for a silver plan of one of the exchanges am a $3800. that is the estimate from cbo. lex peter cook. thank you. >> documents released in the general motors investigation into an ignition switch flaw reveals new information about regulators failure to act. onre in washington with more the story. the documents released by the energy and commerce committee, they were not just critical of gm button suggest the national traffic safety administration made mistakes, to. >> the document showed this by claims that gm was not forthcoming enough back in 2006. the national traffic safety administration noticed warned to claims over chevy cobalt airbags were four times higher than its peers. ignition switches could turn off when chart, deactivating the airbags.

they received 29 complaints about airbag failures. year 2000 three-2006. even with all of the complaints and crash reports, in 2007 a review group overruled the defects of the division and determined there was not enough of a pattern to open a formal probe. -- actingd administrator said did not recommend starting a probe because the cobalt and ion did not stand out compared to its peers. clarence bit low call the numbers off the charts. the department of transportation inspector general is reviewing whether the agency acted properly. >> the document release was quickly followed by key management changes at general motors. what can you tell us about that? few hours ago gm announced the head of human resources and communications were leaving the company to pursue other

interests. john cook truong was named senior vice president of global human resources. -- john cultrone. besides touting his virtues, mary barra also said that his background is invaluable as we create lasting change that puts the customer at the center of how we work and measure ourselves going forward. gm has yet to relay -- announce a replacement for the communications post. they have hired jeff eller come a former director of media affairs in the clinton white recallo help with the crisis. management changes are always expected of new ceos. on mary barra to surround herself with the right people is greater than ever. lex thank you.

gm will join the other automakers at the new york auto show beginning this wednesday. that is on bloomberg starting on wednesday. coming up, strong retail sales for the month of march. we will take a closer look at the numbers and find out if retailers can keep up the momentum in the months ahead. stay with us. you are watching "bottom line" on bloomberg television. ♪

>> welcome back. this is "bottom line." i am mark crumpton. turning back to our top story, u.s. retailers post the strongest sales in september 2 thousand 12. the commerce department reported a pickup and 10 of 13 categories with auto dealers leading the way. jimmy montgomery scott, imaging

direct david strasser joins me to break down the numbers. good to see you again. is this a case of consumers coming out of winter hibernation? >> that is no doubt it is part of it. there were a couple of numbers where things were pretty weak. if burrell should be a good month as well. a late easter. i think we will get a much clearer picture of how strong the consumer is when we get into may and june and get out of the weather related stuff. thanll know a lot more we're into may and june. >> you mentioned late easter. that does not happen a lot. how does that change that dynamic? >> some people are open late into easter. the later easter, the closed that people wear, more of a spring look. so i think it definitely helps being later in the season. especially this season or you have march and early april.

like we justend did in new york, we should have had a very good weekend. >> what does that tell us about pent-up demand? >> when i talk to people, there is no question. people are on the street. more is happening. some of that is good -- discounting. there is a lot of discounting left out there. how much of this was heavy discounting? how much of this is real true demand? >> they want to get this off the shelves? bylast month increased led the biggest gains in auto purchases since september of 2012. what does that tell us about consumers and willingness to go out and purchase big-ticket items? >> there is no question you see it in the confidence numbers. the consumer feel somewhat more

confident. you will see the higher and much lower than the lower end. we watch what walmart is saying versus nordstrom. you get a sense the higher and guys are still doing far better than the lower end. wage growth at the top has been a lot stronger than wage growth at the bottom. housing has been stronger. the economy is doing a lot better at the high end. obviously that tends to be a trend normally but high-end is growing better than the low end. >> talk to me about the internet retailers. did they reap the benefits of consumers taking indoors? >> we will find that out of a couple of weeks when we hear from amazon. the numbers were pretty good. even those numbers, online nontraditional retailers, seems to be spreading out.

a lot of the brick and mortar out growth. what is the likelihood today's numbers will translate into more hiring? will we see a boomerang effect into the jobs market? >> i think the retailers will take a wait and see. they know the calendar shifts are weird. they know march felt better than february. i think people will wait a couple of months to make sure they are comfortable that this is a real trend. the wage growth numbers, higher and getting better in lower and not so much. i think people will still take a bit of a wait and see. there any negative factors that are looming on the horizon? realusing has been a struggle the past couple of months after a really strong -- the majority of 2013 was really strong. it really slowed. let's see how that goes. there are headwinds there.

i think that is one that could put a wrench into it. lex what is the outlook for the rest of the year? >> i think it will be decent. will startple getting more confident. the interesting thing is a lot of the ordering for holiday starts in may, june, july. so if we see a pickup, you will see better interest pickup. >> it is going to sound a little pedestrian, but the fed's role in all of this with a tapering and how rates might rise or fall , what is that doing to the consumer? is a giving the consumer the information they need come a transparency they need. what is it doing to retailers? >> i think the consumer for the most part knows one thing and that rates have gone up. up.ar ago they are

i do not think they watch a day to day, worry about it that much. up, thatrket goes takes money out of the pocket. i do not think the average consumer cares all that much. what about retailers? >> it is tough for the retail stocks to perform that well on a rising rate environment. if rates go up, over time it doesn't take money out of peoples hands and will not be good for retail. interesting when rates started going up last year, homebuilders got hit. you saw names like that bath and beyond, peer one they got hit pretty hard in christmas in first quarter this year. like home depot and lowe's, that tend to lag by six months, you could see slow down there from the weakness in housing we have seen. >> david strasser, channing montgomery scott managing retail analyst. coming up, retirement --

account firm looking to expand into the mutual fund business. that story is next. ♪

>> we have breaking news from citigroup that says the consumer bank head count will drop i-4 thousand and the end of this year. the news comes after shares rose as much as 4.6%, the most in more than 15 months. they posted a surprise increase in first-quarter profit and revenue that beat analyst estimates. citigroup saying the consumer bank head count will drop by 4000 by the end of this year. a big deal involving a world provider for retirement services for teachers and nonprofits. iaa cref financial

6.25ng nuveen for billion. what does this mean for them? >> they will be one of the top 20 managers in the world. they would have $800 billion under management. what it really means is they are able to offer other products, products they are not able to offer and could expand appeal offer.the current they are known for having very good distribution relationship. >> madison dearborn is the private equity firm. what are they looking at?

>> this is a really tough deal for them. they bottom of the financial -- the height of the buyout limit just before the financial crisis started. result, they paid a lot. this can help the asset management business quite a bit. because of that they had to do a lot of work on the investment. they are selling it today for about 6.5 billion. when you do the numbers and math, they are about breaking even. maybe breaking even losing money. we do not know because the numbers are not public. >> what does this mean for financial and institutions. will we see more? >> dealmaking has not really recovered since the financial crisis. this is a big he'll. it will really move the needle on volumes in this industry. what we have in the pipeline

right now is smaller deals. the indexelling business. we are not seeing a ton of megadeals in the industry. that is for sure. tiaaristina alesci with cref story. olivia sterns is standing by with details. rising, stocks are rebounding after last week steep selloff. we are off of today's session highs. the s&p up a 12.5 points. the nasdaq up by 21 points. decent gains today. this comes after resolve the nasdaq fall more than three percent. watchingl stocks we're . the first is herbalife. rebounding off of friday's 14% drop. a person familiar with the matter told bloomberg news the fbi was probing the marketing

practices. showing you what is happening with citigroup shares. the bank planning to shed 4000 jobs in the consumer banking division. though shares are trading four percent higher after the results eat estimates earlier this morning. ♪

>> welcome back to the second half-hour of "bottom line" on bloomberg television. i am mark crumpton. the u.s. military official says a russian fighter jet made multiple posts range passes near an american warship in the black sea. this purportedly happened for more than 90 minutes saturday. it flew within 1000 yards of the uss donald cook, navy destroyer him and 500 feet above sea level. this prompted ship commanders to warnings.ral

they appeared to be unarmed and ended without incident. foracting president called the deployment of united nations peacekeeping troops in the east of the country where pro-russian insurgents have occupied buildings in nearly 10 cities. and a telephone conversation with the u.s. secretary general, suggesting an antiterrorist operation could be conducted shortly -- jointly. lew said the united states is prepared to slap more sanctions on russia over the incursion into ukraine. secretary lu signed a $1 billion debt guarantee agreement with the ukraine. >> we're fully impaired -- prepared to impose significant sanctions as they prepare to escalate the situation in the ukraine, including apparently through support through a campaign through the militants in eastern ukraine. >> ukraine central bank raised

the discount race to nine point five percent. it was 6.5%. thefirst change in benchmark since august. check in the other top stories we're following for you at this hour. search crews sent a robotic submarine into the indian ocean to begin scouring the seabed for the missing malaysia an airline. the move comes after no signals from the black foxes have been dissected for six days. officials were investigating an oil slick three miles from the area where the last underwater sounds were it. timothy geithner will not be the only person on stage for the upcoming book to work -- tour. predecessor and his will be among those appearing with timothy geithner as he promotes his book. this will mark the first time he has made public appearances with ben bernanke or john paulson since he left the treasury in 2013. phelps felt -- michael

coming out of retirement at the 2016 rio olympics. the 22 time olympic medalist will compete for the first time since the 2000 12 london games in a meet in arizona at the end of the month. stearns 29 in june. he captured 18 gold and 22 overall at the last three summer games. that is look at top stories in the news at this hour. time for a commodities purport. seen a lot of volatility in oil, particularly over the weekend. trade to a nymex five-week high. again, closing right above $104 mark. the unrest justifies the level one veteran trader says. meanwhile, the spread between west texas and brent widens to a five dollar spread which narrowed to just over three dollars friday. meanwhile, summerlike conditions

in the city over the weekend. natural gas following on while them -- milder weather ahead. >> goldman sachs striking a bearish tone. why? >> principal terms, the calm after the storm. expecting commodity prices to fall. got their boost from the mobile tensions, boosted demand for a safe haven. tensions and ukraine also boosted corn prices. a 20% jump so far on speculation supply would be disrupted. this has propped up prices. weather is another. in the chinese, you just row in concerns.e credit all of that bullish for commodities. that is about to change goldman sachs says. helping to drive down the

correlations. that only with other asset classes but also the commodities space itself. bottom line, jeffrey currie sees the keys commodity index falling four percent over the next 12 months. annals down 16%. than the percent lower previous forecast. >> you do not hear that a lot. thank you. america. in all-day special report. we will show you how the wealthy and shrewd aren't dodging the taxman and all perfectly legal.

>> time for today's latin

america report. a fresh aftershock called concern in nicaragua. the geological -- geological survey said it occurred just before midnight sunday with an epicenter on the outskirts of managua. the shaking stirred memories of the 1972 earthquake that killed 10,000 people. chile may turn to sovereign wealth funds to finance the expansion of the state owned copper company. the strongest signal since the president assumed power that she will back the investment or a grant that requires more than 20 billion dollars to increase output by 10% this decade. the move and also ensure the company's title as the world's biggest copper miner. your latin america report. on the eve of the in will deadline to file taxes in the united states, bloomberg tv has your guide to the big, small and curious. we are calling it taxing

america. the wealthy and shrewd hop ways around pesky financial obligations like paying taxes. with a little planning they can sometimes exposure to zero. the best part is it is completely legal. explaining how clever law-abiding citizens have managed to get the taxman the slip. taxes thispay your year? if you did, you are a sucker. here are three clever and completely legal ways to get the taxman the slip. an executive negotiating his employment contract. the company might offer millions in shares but will look to pay taxes -- but who wants to pay taxes on millions in shares? that means the executive control wednesday and whether the tax bill comes. it is not just icing either.

often it is the cake. larry ellison earned one dollar in salaries in 2013 and was awarded the 26,000,008 hundred 93 thousand $600 in options. the estate tax eliminate or. a wealthy parents with millions invested in the stock market wants to leave future earnings to kids but once to avoid the estate tax. who doesn't? step one, the parent sets up a renewed and -- an annuity trust. step two, the parent contributes $100 million. step three, profits. earnsr returned the money in excess of interest remains in the trust and gets passed on to the heirs for he is the state in gift taxes forever. the nose sale sale. has $200executive million of company shares. he once cached but does not want to pay the 30 million in capital gains taxes for selling. two hundrede are as

million dollars from an investment bank and uses the shares as collateral. now he has cash to freeze about you. he buys and sells options, granting him the right to buy and sell shares leader at a fixed price. if he ends up keeping the cash, he has to hand over the shares that this comes years after the initial borrowing and money has been working for him the whole time. let us now go to the other side of the spectrum. my next guest says there is separation iscost disproportionately concentrated in low income neighborhoods. he joins me from washington. welcome. thank you for your time today. next thank you. glad to be here. >> how big of a problem are we talking about? is this about predatory tax preparer's?

>> we really do not have good information on how widespread and the problem is. we have some insight on anticipation loans and tax, to high-cost tax products out there that do not have an entire picture. we areome instances talking about overcharges. are we talking about hidden preparation fees or hidden filing fees, what? >> they go by so many different names, it is hard to keep track of them. document preparation fees, electronic filing fees. it is really different from the airline fees. and you get on the airline, you know how much to check your bags for. and this not clear what the fees are or when they are being charged. the irs does not charge any file electronically. they prefer it. not clear what some of the charges are for. >> how much do the overcharges eat into the earned income tax credit?

and that was designed to help low income taxable. >> the fees can range. total a can be several hundred dollars. it is important to keep in mind the air and -- the earned income tax credit and other benefits can be up to one third of a low income annual income. taking bites out of the funds is siphoning off a large share of government dollars. >> we should point out their storefront tax preparation services that follow the rules and do serve clients well by abiding by the strict is ethical standards. are they being unfairly demonized because of the actions of greedy and unethical preparer's? >> certainly a lot of well-respected preparers out there and anyone would be remiss to overlook that. but there is so much confusion out there and uncertainty. for example, the government accountability office and out with a report last week and went undercover to 19 different tax

preparers to see who was calculating refunds correctly. only two of the 19 were successfully to correctly calculate the right amount. only two of the 19. there is a lot of confusion, repairers.the paid >> is this a question of the need for more government oversight or better enforcement of regulations currently on the books? >> we do need new legislation to look at this. has testing and standards in place. the irs has some oversight but not sufficient. another study that the government accountability office that looks at oregon at the testing and credentialing found the tax preparers did 72% better than others.

>> >> they did have a hearing test last week on the matter. you know, always a stressful time of year for americans. how much more so is that for low income household? >> it truly is a stressful time in some regards, trying to figure out where to get the taxes prepared and how to do so fast. people do not understand how to comparison shop well. or just is made only once per year. a lot of information asymmetries. the tax preparer knows a lot more and the individual client does not know as much. also, psychological burdens. you get your forms together and bring them there and do not want to walk away after a couple of hours of sitting down with someone. >> what advice do you have for

people who have not filed their taxes yet? where can they go in the next 24 hours? >> a couple of options available. volunteer taxre preparation sites. income qualification, people taxes.lp you repair library, churches and other communities. online diarist facilitates for free, electronic filing. you can check that out. important thing also if you want to go for the paid preparer, shop around. comparison price. feel free to walk away. if need be, filed an extension and tackle it when you have more time. >> senior research associate with housing and indications policy at the urban institute. thank you for your time. we appreciate it. >> is sure to stay with bloomberg all day today for our special programming coming up. should colorado make or money on

marijuana? every time is tinseltown. the tax incentive-based war over film production. strategy to bring corporate cash back to balance sheet. taxing america all day today on bloomberg television. coming up, an oklahoma teenagers ambles upon a gem. we will explain next. ♪

>> time for hot shots. a look at the most compelling images of the day. in arkansas, teenager goes to the park and ends up 22 thousand dollars richer. a high school student from 3.85 caret -- carat diamond at crater of diamonds state park after sifting through the field for two hours. she named the yellow diamond god's tool.

and arc isnt i've part of the eggs from the heart project and has become a must-see attraction. he stopped to share a cup of argentinian teeth. stay with us. another check of the market movers on the other side of the break. we will continue in just a moment. ♪

>> get the latest headlines of the top of the hour on bloomberg radio and the website. that does it for this edition of "bottom line." i am mark crumpton. thank you for joining us. i will see you tomorrow. the hour, which means bloomberg tv is on the market. i am olivia sterns. getting you caught up with where the markets are trading. u.s. markets are rising. equities getting a nice smooth start after retail sales came in better than expected. retail sales rose for the month of march by the most since september 2012.

overall stocks rebounding after last week steep selloff. highlighting a couple of big movers. the first is staples. announcing the partnership earlier this morning. 3-d printing services will be available in new york city and l.a.. they will let consumers and small businesses create personalized products such as businesses. watching shares of tonic following -- falling to the lowest level. a price target of $14.35 per share. cost.ed high upfront mixed results from the expansion into a new market. taking a look at where the broader markets are trading. once again stocks in the green. looking at technology enjoying the rally after watching the nasa called to the most since 2011 last week.

thank you for coming along. make aroit sellers killing after the stocks. >> certainly investors made good money. alarming and surprising is how very few short-sellers there were and technology stocks. interest on stocks like facebook and netflix, some of the biggest buyers of the rally were microscopic. about less than one percent. is how shortng interest was. >> what is the reason behind that? >> it has been such a one-way market. going nothing but up for the past few years. it has proved to be a losing bet. short theoney to stock. just was not worth it. >> just nervous to pull the trigger. >> do you think the selloff with all last week, the biggest draw

for the nasdaq at hundred and 2011, do you think it had been worse if we have them in the market? >> hard to say but a lot of people saying they not has been as bad. >> if you are short the stock, remember you borrowed it to short it. whenever there is a crack in the rally tom it is a good time to go in and cover the short by fighting the stock. a lot of times you see stocks that are very heavily shorted, once they start falling, it gets arrested by short-sellers coming in to buy the stock. that is possibly why the declines are a lot bigger. pretty big declines. >> what about the trajectory of the markets overall? we are not there yet. >> a lot of the moving averages one way last week. averages areoving still intact, which is one thing to keep an eye on. >> all right.

i agree again, stocks editor, thank you for joining us. on the markets again in 30 minutes. street smart coming up next. ♪ >> you are shopping, i am stopping. the worst losses we have seen in two years. retail sales increased the most in stew thousand 12. street smart starts now. >> welcome to the most important session of our -- session of the day. ukraine unrest rising. the u.n. hold an emergency meeting as pro-russian forces stormed government buildings. worries