diplomatic. amazon takes their retail share at the expense of amazon profits. and the value of viral. american business goes in search of the viral's secret sauce. good morning, everyone. this is "bloomberg surveillance." we're live from our world headquarters in new york. it is friday, friday, friday april 25. i'm tom keene. joining me, scarlet fu. and adam johnson joins us as well. adamn a very brief brief, with news out of ukraine. let's get right to the briefs. >> i want to tell you about u.k. retail sales, unexpectedly rise march. we've got the market u.s. and then at 9:35 come at university of michigan confidence numbers. we have colgate, a mullet, ford, and burger king. >> let me do a data checking. we have news out of ukraine. tures -3. -- fu

the markets are moving a little bit, but they are moving, , nymex crude1.38 goes nowhere. vix 13.3.- nears 836. apple up 8.2%. here is the backstory into the weekend. this is on china. the president not visiting china. renminbi, hereed is the stronger currency, and here is the move up. adam, this is the new breakout. ambrose evans pritchard stead. this move makes it harder for druggy over in europe. this makes it -- harder for mario draghi over in

europe. that this is happening as president obama leaves japan. insults the chinese by saying i will side with the japanese -- >> not installed, but you wonder if they are trying to stay with the dialogue. he is speaking right now in seoul. it is a busy morning particularly on the you crane. belongs tot page what is happening in ukraine. a warning for russian president vladimir putin. secretary of state john kerry says putin is running out of time to do with the crisis in ukraine. he did speak yesterday in washington. take a listen. >> be window to change course is closing. president putin and russia face a choice. of russia chooses the path o de-escalation, the international community, all of us will welcome it. if russia does not come of the world will make sure that the cost for russia will only grow,

and as president obama reiterated earlier today, we are ready to act. >> and of course kerry spoke out as putin warned ukraine against continuing anti-separatists that killed at least five. >> nine wounded, one dead is one of the reports. we need to be careful with these headlines. they are from numerous sources. asmany open to new sanctions well as talks. i have not seen that. >> the president is in seoul right now, and he has made comments that he will speak with key european leaders later on. >> is it safe to say that ukraine is overshadowing the president's good efforts in japan and south korea? >> once again, the crisis of the moment taking over the pivot to asia. >> you look at what is happening in japan, japan is dealing with the tax issue that has gone up and then the island dispute with

china. those are very regional issues whereas when you look at what is happening in ukraine, that is a much more global concern. >> he delayed the trip onto malaysia for one day, sunday, i believe, first time since lyndon johnson was president. -- then >> there is a lot of military in that region as well. we will continue to keep an eye on headlines coming out from the president's trip in asia, but we want to move onto our second front page story that brings us home. blending it that a 14-year low. 15% because the mortgage is now 4.5% versus 3.6% last may. >> first of all, that lending would drop 58% year-over-year, and second of all, it would go to a 14-year low. that is lower than in the crisis in 2008 when all of a sudden the market shut down. it does not feel that way in new york city --

>> shout out to michelle meyer him a bank of america, merrill lynch. i think we have seen that in the interview after interview, we solve that in existing homes, a disappointing new home sale this week. >> yeah, all new numbers trailed off, existing home sales, new home sales, and mortgage applications. >> you are going to pull back and not go for the five bedroom, seven bath. guy, fourreasonable bedrooms is enough. >> the big banks are still dealing with all the legacy issues from before. bank of america, for instance, under pressure right prosecutors stoop a $13 billion to resolve mortgage backed securities in the lead up to the financial crisis. >> and there is a lead up in terms of jobs going to labor and that is the area where we may see the most. >> and cuts in home lending and increases in hiring and compliance. our third company story -- microsoft beating profit estimates. the company excelling its push into cloud computing under its

new ceo satya nadella. unit, 80%.he >> it is there, and i love his raise -- ambient intelligence. >> what does that mean? >> steve ballmer never would have said that. ceo >> right. >> what did he say? >> ambient intelligence. >> of those are front-page stories. >> these headlines are too good to pass up. the president, putin increasingly seeing the world through cold war prism. the president -- i absolutely would save mr. putin if he were drowning. >> of that was a strange comment. >> there must have been a question -- >> and with the backdrop of the

korea --and south >> the followthroughs even bigger. i would like to think that putin would also save him. >> these are delicate. the way, they have been talking over the phone quietly behind the scenes as mr. kerry and mr. lavrov are the ones out front. curious what is happening. >> of the back channeling. we want to introduce our guest humor.he ceo of social he is better known actually as a pioneer of viral media. he is why you cannot resist opening cap videos and cad videos. online journalism startup is circa. as you look at how useful that income how do you go about making something like ukraine headlines viral? is not about

viral. virality for news and something based on fact and making sure people get reliable sources over and over again. that is how you build trust. it is about getting credibility, trust. onyou are way out front this, and i suggest everyone is catching up to you. i would be honored to have your thoughts of the new news. we see it at box.com, upshot at "new york times," bloomberg's quick taken others, are they playing catchup that is hopeless or can they have an impact with these new rapid news sources? >> we just threw the first pitch of the first game of a brand-new series. >> do we use pine tar? [laughter] >> let's not go there. we are figuring out that we do not read newspapers anymore, we tablet and iews, at west devices. that has to change the way we deliver the news. that means not long articles,

but something short, something something that explains things. that is complicated. >> how important our pictures, videos to that storyline? >> the storyline has the right amount of pictures and the right kind of videos, but if you talk about a generational gap, between millenials and the old ialsration, the millennial will always want -- >> help me here. i have got to try your glasses on later. , this isly here incredibly important, is there somebody with best practices in this new news? >> and there is no single best practice. there will be multiple best practices as there were multiple types of news being delivered. >> can money the made at this? >> you bet. >> but is that an ad-based model or is it a sponsorship model, is it a pay for content model?

>> it is all of the above. i would like for to be all of the above. >> i still focus on the idea that there is a distinct between butertainer and news, that is blurring. >> i really hope it comes back. i think it is better for society when you do not confuse humor and news together. i know jon stewart does a great job, but we are not all jon stewart here. we need to have news that is credible and entertainment that is different. >> vertically important as all this new stuff you are leading the way on, you are the king of viral, fine, is an overweight on traditional media, or is it old media drifting away? a really good question. i do not think old media is going to die, but it is like radio. you're going to have to find a neat if you are old media. if you are a magazine, you have to find out what you are going to do. you see forbes selling itself to media buddies. >> glasses switch. here we go. oh, my god, he is blind. >> how about you?

adam, you never looked so good in my life. >> or you, tom. >> my eyes are really blurry, he looks really good right now. >> were you like, three years old when you -- >> yeah. >> you need pine tar. >> kenny reidy teleprompter? -- can you read the teleprompter? >> corneille, i cannot read the teleprompter. ben will be with us through the hour. let's go to company news. offer $13 billion -- a ge may offer $13 billion for the alstom company, the biggest acquisition ever. the world's biggest the bank card network, which makes visa, posted fiscal second-quarter profits that beat analysts' estimates.

the ceo, charlie sharp, says a stronger u.s. dollar will hurt its earnings growth. and starbucks is showing that it is not just about coffee. the world's biggest coffee shop chain has raised its forecast. big suites held by and breakfast images. it climbed 6%. that is today's company news. is awesome.venues that is the overlay on ge. >> that is the real deal. amazon sales up 23%. guess what, costs are also up 23%. maybe it takes money to make money. we will debate that. this is "bloomberg surveillance." on bloomberg television, streaming on your tablet, your smartphone, and bloomberg.com. ♪

>> good morning, everyone. "bloomberg surveillance." it is a busy earning season. robert shanks, ford ceo, will join "market makers" at 11:00 a.m. we will see how dearborn, michigan is doing. at 11:00 a.m. this morning with bob shanks. this is "bloomberg surveillance." i am tom keene. with me, scarlet fu and adam johnson. the president speaking in seoul, korea. >> we're keeping an eye on amazon this morning. the shares are down 1.5%. the theme seems to be spent and you shall receive. nothing to become a's business model. sales rose 20% but their expenses increased by even more, limiting earnings per share to about half of what it was a year before. anthony joins us now by phone, and victor, there seems to be

this idea that amazon is spending money as fast as they can make it. shipping cost grew 31%, which was faster than what revenue increase, how much longer can amazon keep us going before investors throw their hands up and say enough? >> you had accelerated revenue growth, which topped our expectations you had gross margins, which expanded for the 10th consecutive quarter, however, as you noted, this was a heavy investment quarter. they called on china specifically. seeuge opportunity -- they huge opportunity there. they are also investing heavily in cloud services business, so as a result, the margin did miss x relations for the quarter and they guarded margin contraction in the second quarter as well. however, when you look at that, my key take away from this call in my key picks for investors is you invest along with amazon and you will be rewarded on return.

you do have a business that is fundamentally strong, 20% plus and returns an investor capital, and investors have been rewarded in amazon investing heavily over the past five years. i think they will be rewarded going forward as well. >> victor, well said. chart,t up a courtney, if you would. victor, how long until amazon essentially corners the retail market? do they have years and years of growth to come? or have a almost taken their fair share of retail america? >> i think it is the former. when you look at e-commerce, i think it has a 20% interest growth curve globally, so there is a lot more retail off-line that has to be moved onto the internet, and amazon is in the

pole position to benefit from that. so i think the runway for amazon is long and wide as well. so you should continue to invest and i think amazon is a company that takes a multiyear approach to its growth and investment strategy. you will see them continue to invest, but this is a model that has leverage. they are choosing to invest the cash and that growth because quite friendly if amazon does not do it, someone else will. quite victor, as i look at the consensus assessments for the current and third quarter, amazon is forecast to make 36 tons versus a loss in the last two quarters of $.11. are they turning be corner? they typically guide conservatively, so i expect them to beat that and probably report a positive number. i would expect those numbers to come down in the second quarter. mine certainly has. i think the key message for me

next you look at over the 2, 3 years, you are actually seeing margins expand as a gain leverage on a lot of these investments that they are making today. >> all right, thank you so much, we appreciate your joining us, victor anthony of topeka capital markets with the latest on amazon. our guest was for the hour is ben huh, a pioneer of viral media, and he is the operator of social media site cheezburger. you have got to wonder whether it's inventions live there. >> it seems like the news front, the war, the high-tech companies is physical, real space. you see facebook trying to obtain a drum maker, which went to google, you have google trying to work on cars, and you also have the battle for china, which is interesting because facebook to spend $19 million on whatsapp.

the way to get to china right now is through mobile phones. >> you are from seattle, right? >> yeah. >> it'd go down to serious pie, what do people think about there?in >> it is amazon territory, see willie are nothing but good things or not at all. >> it will not say anything bad. >> i just want a handle on how amazon is perceived in seattle. >> pretty good, they are building and investing downtown, so they are buying a lot of goodwill. it into aurning high-tech corridor, so that is a good thing. but what are they doing in terms of investing in the economy? onok, ben huh with us amazon, on seattle. >> northwestern football players are heading to the polls today to vote on whether to become a union. we are talking about the pay for our powerfulith

attorney, jeff kessler. tweet us, we want to hear from you today. growth simple. are college athletes worth more than a scholarship?. tweet us @bsurveillance. this is "bloomberg surveillance." on bloomberg television, streaming on your tablet, your smartphone, and bloomberg.com. ♪

>> can morning of everyone. "bloomberg surveillance." garlic the a really important must listen for us. >> good morning, everyone. "bloomberg surveillance." scarlet fu has really important must listen for us. >> present obama is in seoul, korea. vladimir putin said he thought the u.s. president would save him if for some reason he were drowning because even though

they do not have a close personal relationship, the president of the united states is a good person overall. here is what mr. obama said -- >> i absolutely would save mr. putin if he were drowning. if anybodye to think is out there drowning, i'm going to save them. i used to be a pretty good swimmer. i grew up in hawaii. i am a little out of practice. >> i don't know. that does not sound like a ringing endorsement. "i would like to think if anybody is out there drowning, i would save them." >> after what we saw this week, i mean -- >> there are still hundreds of people who drowned in that ferry. >> ben huh, you are korean, -- still trapped,re and this is a terrible question in the terrible time. community much more

related. it is everybody's loss, not one family's loss, and it is a public issue. >> that was delicate by the president. >> that was definitely a faux pas there. >> not a faux pas, but tough. >> no, i think it was a faux pas, given the tragedy. we have more coming up on "bloomberg surveillance." summer will be soon upon us and along with the weather, global growth momentum looks to heat up. we will be discussing that was our guest next writer on "bloomberg surveillance." ♪

>> good morning, everyone will stop our footer question of the day of course having to do with the northwestern wildcat varsity football, college athletes. are college athletes worth more

than a scholarship? an emotional uniquely american question. are college athletes worth more than a scholarship? this is "bloomberg surveillance." i am tom keene. let me do a quick data check here on a friday before we get to gainers and losers. very simple, futures -2, yields come in a risk off feel, a 10-year yield. >> apple up yesterday 8%. last time again that much, two years ago, after tim cook at announce the bonanza of cash return to shareholder. increasing dividends, increasing buyback, and splitting its stock 7-for-1. you wonder how long before -- >> the world is coming to an end at $400 a share. >> no, it is not, actually. >> so typical. >> remember these moments?

amazon is done, they are finished. >> and bank of america at $4.78. probably going to zero right now. probably not. be happy. worry, global center banks are plowing -- >> are you talking to me? banks global central lowered money into the system according to our next guest, former of credit suisse, now one of the heads of the bahamas-based celtic investment. great having you appear from the bahamas. how much central-bank stimulus still need to get this local economy back on track/ isliquidity growth right now running about zero percent year on year, so we are affecting the cover -- over the coming months were to start to improve. real global, if we look at that equation, it should improve. even if we assume that the feds stay on the current course, you look at the people's bank of

china and they do not know what they are doing although they did cut some local banks, but looking at the ecb potentially increasing liquidity and eventually the bank of japan increasing liquidity, so that should come all told, start to improve. >> is mario draghi more important than ben bernanke was? >> right now he is the reason being that europe right now is stabilizing, but you need more stimulus to really get a stabilization to turn into a solid recovery. if you look at what is happening in the u.s. right now, even if we assume that the federal states on its current tapering path, we believe the u.s. economy has enough roads and rate of growth to really get us into a stronger -- >> one of the things you are so good at is synthesizing all of this. i have got a morning must-read, folks. watch, this is really the price dynamics of the system where foreign exchange tells us about inflation. this is in the "telegraph," i thought it was brilliant, the

u.s. treasury clearly suspect authoritiesnese have reverted to their mercantilist tricks, driving down the exchange rate. it is no mystery why the world is drifting ever closer to deflation. >> to an extent, it is, but we do not really believe that the world is moving toward deflation in a very significant way. from running plays and -- from an inflation part, if you are looking on the inflationary front, there are a few technical that maybe inflation should increase, but you need stronger economic growth. when you talk about utilization, u.s. around 70%, unemployment around 7%, on implement in 12%, there is no reason to be worried about inflation unless you are more worried about growth. >> atul, you say the best opportunity is growth in u.s. for activity photo companies have squeezed out all they can

in terms of gains from job cuts and all that. business spending is left to pick up the slack. >> that is really the point. if you look at productivity growth, that is the single biggest opportunity that we will see the global markets over the last decade. the next idea to increase productivity growth is through investing in productive assets, that is technology. we can take capex at something that will improve. >> and ben huh, that goes over to you and what you were seeing with the entrepreneur, innovation, the viral. you guys take away the capex. it does not cost that much to do what you do. >> the idea of starting a website is just a thought in your mind, you have that web services coming basically turn on the machine. capex however is moving the big companies. you see public companies taking on more than ever before. >> we saw yesterday with the capital goods orders, x defense

up, which is double the exultation. all that said, atul, where are you putting money now? >> right now the single best opportunities remains developed markets over emergency markets. earlier this year we were not as positive. we're getting more positive. it is not the time to pen your years and by yet, but we are starting to see it improve, liquidity improve, u.s. over emerging markets. >> eisai developed markets over emerging markets. does that include japan? because mine is from bloomberg thoughts about visiting japan, the things they did not talk about with the economy. the great reformer, continues to treat the symptoms of japan's funk with ultra-loose monetary policy rather than addressing the rigidities and direct the competitiveness. the third era looks like a nerf dart.

>> if you look longer-term at japan, the biggest issue is demographic. we have demographics moving into, it is very difficult to grow. term, if youhorter are affecting the rest of the world to pick up, that will pick up japan's export. we are not looking for an internal recovery in japan, it is more external. >> out of the blue, carl icahn is happy, is it a name changer for all of american corporations, does use of cash become a different story? >> we think it does. interest rates move up, companies will be forced to start to look at investing in growth rather than just buying back shares. >> in other words, capex has gone up because it has to. rights absolutely a stew. industrials? where is the sweet spot? >> u.s. industrials is more attractive from a cyclical perspective.

from another perspective, capex is where you want to be. you look at software and services, they're all cheap compared to the crisis aggregate. >> explain where you are in terms of finance in the bahamas? is it a boom business? >> we think it is. we are trying to create a hub because we can service u.s., latin america, europe. it is quite attractive geographically. jurisdictional es well i'm of the bahamas has been very strong in trying to -- jurisdictional ly as well, the bahamas has been very strong in trying to attract businesses. >> in the polar vortex. >> why is this guy so smart and we are so dumb? [laughter] >> i don't know, it is not a bad thing working in the bahamas. flyingle, thank you for up and coming to talk to us today. >> coming up on "surveillance," we are giving you the probably

these of ukraine coming up in our single best chart. this is "bloomberg surveillance." on bloomberg television, streaming on your tablet, your smartphone, and bloomberg.com. ♪

>> good morning, everyone. "bloomberg surveillance."

this fridayne morning with scarlet fu and adam johnson. mr. johnson has our top headlines. >> standard and poor has junk,aded russia to i am sorry, one step above junk. s&p says further downgrades are possible if the economy gets worse and the conflict in ukraine leads to more sanctions. mortgage lending at a 14-year low. it fell 58% in the fourth skirt or -- first quarter from a year ago. toerest rates have risen four point five percent. and football players and northwest university decided today whether to change college sports. they will vote on whether to join a union. last month, the national labor relations board regional director ruled that the northwestern players are employees and could unionize.

those are your top headlines. >> ben, our guest was for the hour, ben huh of cheezburger, you went to northwestern. he went to a couple of football games. >> i went to almost all of them the first two years. i went to a lot. they were trying to break one of the worst losing streaks in football at the time. we were just trying to be respectable. >> was this the keg, where beer was consumed? you are at the keg, you are lighting in the muck, explain to us the place of sports and particularly football in the culture northwestern. >> at northwestern, students first, athletes second. we did not lower academic standards to let our football players in, and we actually went to the rose bowl. >> this is different than michigan. >> yeah, i hear about that, but we are not one of those guys who play sports first. the unionization thing is weird.

>> the federal government made us put a graduate of purdue in our control room. >> i heard there is a wildcat in there as well. >> yes, there is. >> but football at northwestern it's not like at usc or florida state. >> it is not a religion, this is not a big thing. this is the perfect way for unions to test out the idea because you have division one a, which is proper football, but you have one of the smaller schools in the big ten, so you have got the best a testing ground. >> well put. actually, this all has to do with our twitter question of the day. are college athletes worth more than a scholarship? do they deserve perhaps a salary? tweet us @bsurveillance. >> a big deal. we will cover this. big deal. let's do single best chart. >> we will look at what is going on in ukraine. in fact, we will quantify the ukraine crisis from anders

court. they provide strategic and international brisk alliance to businesses. what he has done since he arrived on the ground in kiev is discuss the probabilities of various events with different context. the user to build a model showing the probability over what would happen over the next three months. sustained attempt that destabilization, 90% odds of it happening in the next remarks, get everything else that is more extreme than that whether it is a tank invasion into the eastern or southern part of the ukraine ora preinvasion selling bombing or civil war, those are below 50% odds. a tank invasion into moldova, tom, you have been talking about that, 40% odds. >> look at this headline just across the bloomberg terminal. ukraine to "resist and liquidate russians if they invade." that is from ifx. that is a serious headline.

>> what jumps at me as being so strange is all of these "master masks, are all wearing yet people are waving russian flags over masked gunmen. it is kind of trippy, you know? what are we actually seeing here? there is no precedence for this. they army of one sovereign country goes into another and pretend it is not there. >> i'm not going to go there. we do not know who they are. >> we do not know who they are. >> although russia has spun it a very big tale. they have done a wonderful job controlling the messaging in ukraine. what wethis counter to are seeing now because russia is using traditional media to control the message. difficult to control messages across the entire internet but russia is basically

establishing a buffer zone that they lost during the cold war. you have the war in georgia establishing a new buffer country, and now you have been doing ukraine and others. >> your world is different here than it was it in the air of spring. the twitter vigilantes are different, write? -- right? >> and russia announced they would regulate every single blogger without them giving access to the media. this just happened. >> let's move to photos. >> we have got a number of them, starting with our number three photo, veterans and dignitaries gathering to commemorate the 99th anniversary of australia and new zealand army corps, anzac day. that is when allied first world war forces landed on a peninsula. is part of the empire. this is baby george returns to the united kingdom. >> you could absolutely look at it that way.

number 2 -- president obama is welcomed by japan's emperor and empress at the palace in tokyo, part of a four country tour of asia to advance specific nationstates. >> our office looks down on the imperial gardens, and there is no place like it in the world. pageantry of this, as you compare this with ambassador kennedy and you compare eisenhower's historic visit, all of the emotion of the middle 1950's after will war two. >> and credible pageantry. when ambassador kennedy announced she was greeted by the emperor in a horse-drawn carriage, that is the way they do it. tremendous honor and pageantry. >> number one, am a lighter note, ronald mcdonald has a new look. known for his baggy yellow jumper, he now has a new wardrobe, which includes a red boards coat and get this, a bowtie. >> which guy in las vegas looks like that?

>> tom, you don't even know where i am going here. here is ronald with his "surveillance" doppelgänger. are you ready for this? we could not resist. >> i remember the day that photo was taken. i had no sleep. >> you look good in that photo. look at that. you are lean and mean and on top of your game. it looks like mcdonald's in brooklyn, a little hipster, tight jeans. >> look at that! >> there he is. i like it. >> you should smile like that every day. >> which way to burger king? >> value mill only for one dollar. i am not sure how much longer. >> let's tweak out that picture. maybe it will go viral. >> ben huh, maybe you can help us with that. >> coming up, how can you can tell when a story is going viral and when it is authentic.

the key ingredient for companies to get attention. we will be back with more from our guest house, ben huh, the king of the meme empire. this is "bloomberg surveillance." on bloomberg television, streaming on your tablet, your smartphone, and bloomberg.com. ♪

>> a good morning, everyone. "bloomberg surveillance." it is a gorgeous friday. you that the feel of a later spring. it is a little chilly, but that spring is coming on on the island in manhattan, the metlife building, the empire state building, downtown in the distance. this is one world trade. this is "bloomberg surveillance." keene, with a scarlet fu and adam johnson. let's get right to it. this is a fascinating topic. i am not up to speed. >> you promote your personal brand, promoting your personal andnd or a corporate br and avidly means grading a meme or jumping on the bandwagon. ben huh is our guest house, the ceo of cheezburger and a pioneer of viral. style," unflattering

photos of beyoncé, vladimir putin baring his chest and petting a leopard. what is a common thread linking these ideas? >> some are ridiculous. you talk about vladimir putin undressed, that is kind of weird. the weirdness always works, but what we're doing is people are taking things out of their original context, inserting them into a new hilarious context and sharing with others. i would argue that the vast majority of what you think is viral is not viral anymore. true virality is rare. style" is viral. but beyoncé, many organizations thing let's see if we can push this, broadcast this to lots of people, but the participation that people remix it and engage with it. ask how do marketers engineer virality of their contents? >> they engineered the content of their brand, they're blurring the lines between advertising

and entertaining and figuring out they can get more dollars for the buck. >> does the message gets cured in that process and reinterpreted? >> that is a good point and it often does. one of the problems with virality if they take a message and target it at a different audience or wrong audience by twisting the message out of context, so when you see a lot of viral marketers, they might not be the right one. >> so you wonder into gm, i believe they have talent is right now, what is your advice to mari barrette to get a viral or sort of viral message out that is gm friendly? >> zip it up. she does not want to be the one making any news. you decide twitter hashtag called #mynypd. boy, that did not go well. at some point, you have to understand that your brand has a negative side to it, and you have to do defensive pr instead of office of -- >> what is defensive pr? >> i am sorry, i want to tell you that you are unique

customer in an easily recognized and not put ourselves in the forefront in the public for civic and amount of time until you know that your brand some road to recovery from it. >> so you can is in your something whether it is offensive or offenses, but how do you get people to spend money on it? for instance, american greetings, the card company coming out with a video that celebrates mother's day. >> very touching. >> it is called moms have the world's toughest job, it is gotten a lot of traction online. your mom called in during the commercial break. she has got a tough job, right? how do you translate that, those views into going out and buying cards or using their online website? >> you are looking at the best integration between the message of the viral video in the actual product you have to sell. this is a great tie up. this is about mother's day, the timing is correct over the emotional impact is there, and even at our company where we have seen everything and anything, when people are tearing up in the office, that is a big deal.

>> i am honored to ask you this. do you think apple will work on facebook? am i going to want to look at ads on facebook? >> people are trying to take your attention and move it somewhere else. facebook is working because you actually take action in line, in the facebook newsfeed, you can sit there you go yeah, i want to install that app, why not? that engagement in stream is what is bringing roi. just asement is beholden to the laziness of as anything else. if you make them do more things to get your ad, it is going to be hard, so let's just do it right eric a pretty my friend's baby's photos. >> he founded a lot of companies. some have worked better than others. what is the key take away? >> consistency and when you look at failure, you keep trying. that is the heart of entrepreneurship. >> thank you. really interesting. >> a lot to think about over the weekend.

and to build up your personal brand. wife i have got to figure out how to be viral. 35.98, that is a weaker ruble within the last hour. we have much more. howard ward with us next on "bloomberg surveillance." ♪

>> this is a "bloomberg surveillance." >> tensions mount in the ukraine

as kerry and lavrov are less than diplomatic. the stock market loves apple's use of cash. the fighting northwestern wildcats want to get paid. good morning, this is "bloomberg surveillance." live from our world headquarters in new york. friday, april 25. i am tom keene. joining me is scarlet fu and adam johnson. our guest host is howard ward, 's ceo. so much about these equity markets. let's get right to a brief before we dive in. >> overnight, u.k. retail s ales rise. economic data in the u.s., 9:45, pmi index. a lot of people are watching the university of michigan confidence number.

colgate, palmolive, burger king, and ford just crossed the tape. in terms ofs first-quarter profit. adjusted earnings per share of $.25, analysts were looking for $.31. automotive revenue later than expected, under $34 billion. analysts were looking for 3 $34.2 billion. by severalimpacted factors not representative of the underlying business. maybe there is some noise like gm. >> outside the u.s., losses will continue to grow in south america as well. asia-pacific operations had a record pretax profit in the period. north american operating margin, 7.3%. ford was leading the way among u.s. carmakers. >> interesting how visible mr. feels is. -- mr. fields is. >> speculated to succeed out

mulally. >> exceeds its pretax profit guides. >> it will make it up in the second half of the year. >> they took a ride off for the four to reno in the 1970 -- for the ford turino in 1970 where i took a bottle of champagne all over my father's car. >> what was the movie he drove a grand turino. >> clint eastwood. >> driving a grand turino. >> thank you. >> next on "bloomberg surveillance," looking at the ford pinto. autos.s move beyond prosecutors want bank of america to pay a record settlement to resolve investigation into the sale of mortgage bonds from

before the financial crisis. according to people familiar with the matter, 30's are seeking $13 billion. moreank has agreed to pay than $9 million to resolve other claims. microsoft's push into cloud computing is paying off, they posted third-quarter profits that topped estimates. revenue from the cloud-based version of office more than doubled. netflix cracking the cable market in the u.s.. online streaming service has signed deals with three small pay-tv operators that will offer netflix through set-top boxes made by tivo. that is today's company news. $.68 on $.68, the international makeup of american earnings and revenues. howard ward, gamco's chief officer of growth and

investment. your thought on the earnings season? it is an interesting income statement. >> their earnings season is very solid. there have been problems with some companies, mostly weather-related. for the most part, the earnings are exceeding guidance. >> is very an underestimation of cost cutting? you take it out in the middle of the income statement. >> there has been an underestimation for the last couple years. >> continues. the company's continued till surprised. >> what are you buying? >> i can't tell you that. >> do you want to be more exposed to consumer spending? >> our thesis is that the economy in the u.s. is accelerating. you want more of a cyclical till to your portfolio. industrial names like honeywell or union pacific. andnology, of course, apple

google. those have been my two biggest holdings for years. a 20% correction actually got down to 15 times other days ebitda the before rebounding a little. for a company growing at the rate it is growing, north of 30%, that is a very defensible valuation. becauseou go to mid-cap blue chips are so overvalued? >> there are values but let me say this, the big caps that have shined lately, but they have underperformed the overall market of smaller caps. for the last 10 years. they really have room to grow from here. they're much cheaper relative to the other sectors involved. >> another sector that has flagged is industrials. now we find capex spending going up, is this a driver -- industrials? >> absolutely.

stocks, the industrial have done pretty well. very surprisingly. their stealth winners for the last six months or 12 months. they continue to represent good value. honeywell had 15 times forward earnings with a 2% dividend yield. there you have got exposure to aircraft and auto and construction, residential and non residential. the industrial theme will continue. >> you and i remember a time when we spent all weekend talking about stocks. is it such a changed world, including geopolitics in ukraine? >> the geopolitical factor cannot be ignored right now. that is a pressing matter for the market. i think it is very difficult to say i am only going to focus on stocks. you have to look at the macro

situation, whether it is geopolitical or what is going on in china or japan. all these factors influence the global economy. the market maybe are not perfectly correlated but they are connected. >> does that mean buy american? >> the u.s. has the best demographics of the best growth story. the emerging markets do not have a good story. >> to what extent are executives looking at what is going on outside the u.s. as they rush to strike deals or go ipo? >> they have a big cash toward overseas and the u.s. will not let them bring it back without a 35% tax. you get frustrated and decide to put that money to work overseas. will buy a french company or bristol-myers and by a foreign drug company. this will be the next wave of mergers, u.s. companies using foreign cash to buy foreign companies. >> that will help boost profits but does not contribute to jobs recovery at home.

>> this is a lost opportunity for americans. we are losing jobs and losing profit with evidence. all this money is going overseas and it is going to stay there because of our stubborn policy in washington. >> you just gave me an idea. u.s. companies with a lot of foreign cash that are potentially going to buy cheap companies abroad -- is industrials? >> are you asking a question for your 12:00 noon show? >> absolutely. >> that is terrible! >> shameless plug. >> we have a global radio audience. >> the radio audience will listen to you until 10:00 and then at :00 they will -- >> timeout. >> is industrials? >> europe has lagged our recovery here. you're going to find some cheaper industrial names there.

there is a big caveat that goes back to the russia-ukraine situation. it has to do with the dependency europe as for the oil and gas coming out of russia. over 1/3 of the supply. if the situation there gets increasingly problematic, which is likely, russia -- >> germany was talking tough on sanctions this morning. we have not seen that, how do you interpret that? >> that is trying to tow the line with the u.s.-nato policy. intimidation. of we have no intention of being militarily involved with russia. we are trying to intimidate them. i don't know if what american can be intimidated -- i don't know if vladimir putin can be intimidated. >> 9 wounded and one killed out of ukraine. let's look at a data check. stocks, bonds, currencies, commodities. -6, as were flat,

challenge turn within the hour. 10 year yield was at 2.72,lower yield. 37, renminbi weakens. the ruble, yes, 36 on dollar ruble. >> finally. coming up on "bloomberg surveillance." northwestern football players vote today on whether to join a union. we will be speaking with jeff kessler about what this means. that brings us to our twitter question of the day, our college athletes worth more than a scholarship? ♪

>> this is "bloomberg surveillance." i am tom keene. this matters now to howard ward. was and is an apple bull. billions and billions of dollars this year. cash laden corporations, will they follow? everybody follows, is that true? all the other corporations? >> this has been an ongoing trend.

companies increasingly returning cash to shareholders through dividends and share buybacks. child forhe poster this. no one has more free cash flow than apple, $45 billion of free cash flow. increase in their share buyback program from $60 billion to $90 billion, 8% increase in dividend stock. they are the poster child for it this week. it is going to continue. they have also indicated the opportunity -- we talked about cash overseas. they cannot bring it back but they can borrow here and use that money to buy back stock, retire the stock, limited the dividend and me the after-tax benefit of the interest cost. so it becomes a very lucrative deal. michael holland were way in front of what they would do next. financialhas the

firepower, they generate a lot of cash flow. they do not have the mindset. >> the mindset is a blue-chipization of stocks. >> in the case of google, the companies continue to grow at a high rate and they do not feel compelled to return cash to shareholders. they are very inquisitive and using cash and other means. that is the good news. the bad news is the shareholder does not get immediate cash. >> in 2014 we will see less buybacks across america then p1013? >> yes, some of that money is going to be spent on capex. you cannot avoid capex. you can do for it or postpone it. companies have done that, that money has got to -- it has got to buy equipment and increased plants.

>> what is the pharmaceutical m&a binge of this week signaling? >> the government is a big buyer, sellers need to bind together to get more leverage against the government. >> howard ward with gamco. the president continues his tour of asia. he is in korea and he missed to malaysia and the philippines. this is "bloomberg surveillance." stay with us. ♪

>> good morning, "bloomberg surveillance." a busy morning. with me as scarlet fu and adam johnson. our guest host is howard ward, chief investment officer of growth equities. a busy morning in international politics. adam johnson here with our top headlines. >> rising rates have pushed up 14 year lending to a

low. higher rates, lower lending. this is according to the newsletter inside mortgage finance. fell 58%.of loans the average fixed 30 year home loan has risen almost a full percentage point in the last year to 4.5%. john kerry has a warning for vladimir putin. out of putin is running time to comply with an agreement to use tensions in ukraine. russian troops in military exercises on ukraine's border. ent obama in south korea but tensions with ukraine's overshadowing everything else. obama responded to reports that vladimir putin said he thought obama would save him -- >> i absolutely would save mr. putin if he were drowning. i would like to think that if anybody is out there drowning i am going to save them.

a pretty good swimmer, i grew up in hawaii. i'm a little out of practice. are your top headlines. obviously a very awkward moment for the president, the ferry sunk in south korea. the whole thing was very -- >> he was almost set up for it. he did a good job of getting through it, it was painful to see the ballet there. comments putin would say in the first place. in the first place, i would save president obama. >> we should emphasize this, the headlines are coming fast and furious out of ukraine. theill keep you up-to-date, ruble has weekend. we have a 36 point on ruble. that shows the tensions this morning in ukraine. >> the pay for play debate is going for an incident today as northwestern football players vote whether to unionize. jeffrey kessler is a powerful

figure in this debate. he recently filed a lawsuit against ncaa schools for anticompetitive behavior, arguing that scholarships cap what college athletes are worth and amount to price fixing. jeffrey, so much to talk about but let's start with what is happening at northwestern. what would football players gain from collective bargaining? >> all of these struggles are about the same issue. which is, right now in men's basketball and football, you have very large amounts being generated. in what amount to businesses. you have everybody sharing in those benefits except the very people -- the athletes -- to generate the money. >> what is wrong with simply letting their portion of the sharing be a full ride scholarship? and an education. aren any other business, we

talking about businesses here, that is what they are. overrsity of texas makes $175 million a year just in football. it is a pretty good business they run. they have their own cable television channel. in any other business, no one would say -- because it is illegal -- that competitors can get together and say workers will only make this. fix the wage. that is what this is. what we are really seeking -- >> share the wealth. >> that's right. what we are really seeking here, we are not seeking to mandate anything. we are seeking a free market. let the schools decide. to put asideants money for a player every year and say if you graduate i will give you a bonus and i will give you extra money for staying in school every year, what's wrong with that? the ncaa right now would say you cannot do that. >> where do you draw the line?

we will give you a car and pay you salary and pay for vacation, too. >> we have faith in markets. in letting schools make the best judgment. the ncaa used to say schools and conferences could not do tv broadcasts of football. the supreme court said that is an antitrust violation. the ncaa warned it would be chaos. what happened? an explosion of tv programs that consumers and fans love. >> you are a northwestern alum, what do you think about this debate? what effect the way you give donations to the school? >> i view this -- i don't know where i come down -- i view this as no one has to play football. this is a voluntary agreement. being recruited by various schools, you can take

your pick or you do not have to pay football. if you want an education, fine. theseschools, most of schools depend on the football programs to subsidize the rest of the athletic programs. if you are going to take amaya generated from foot wall to pay football players, what happens to the other programs? >> they all survive and do wonderfully. >> the market -- >> not even the market. the revenues today are 10 times what they were 10 years ago. we are not saying the players should get an unfair share. they should get something. there will be plenty left over to support the other programs. maybe the coach, who is making $5 million, will make $4 million. but there is enough. >> we will keep this going, can you stay with us? we have got to take a very quick commercial break. a lot to talk about.

>> northwestern football players get ready to vote on whether to join a union. ever twitter question of the day, are college athletes work more than a scholarship? tweet us. this is "bloomberg surveillance," on television, radio, and streaming on bloomberg.com. ♪

>> good morning, "bloomberg surveillance." a gorgeous day in manhattan. ourists. loads of tourists. >> the polar vortex is over. >> what a concept, they have

children? >> are you back from europe? >> mentally, not really. let's get the company news. france, the board of alstom meets to discuss a potential sale to general electric. ge may offer $13 billion for the maker of power plants and transmission gear, making it ge's biggest acquisition ever. the world's largest bank card network visa posted profits that the estimates that revenue came up short. shares of visa felt more than 3%. the ces is a stronger u.s. dollar will hurt earnings growth. starbucks is showing it is not just about coffee. its full-year profit forecast. starbucks being helped by sales of breakfast sandwiches. u.s. comparable sales rose 6%. that is today's company news. >> continuing the discussion on

northwestern varsity football. is fromard northwestern, acclaimed equity investor. he has a unique perspective of what they do in evanston, illinois. jeff kessler with us as well. iconic in sports law. it's like one of the klest places on the planet. here's a kid in c-gate who has 800 s.a.t.'s and he's going go to northwestern in fist six and there's another kid who can move a park around or tennis or whatever. should we treat the kids differently? frame that within this ncaa debate. >> we should allow the schools to treat each student exactly the way the schools want to. right now -- >> isn't the risk as a star full pacquiao from some school in texas, where's rg iii from?

r.g. grift? washington redskins. >> baylor. >> i don't think that's what the marker would generate. if a kid wants that kid from c-gate and let's say the kid is a great musician and you want to give the kid extra housing, extra benefits, guess what? there's no rule to prevent it. the only people who are subject to these restrictions are not the rest of the student body. it's only the athletes. so we have to -- go ahead. >> no, i don't mean to interrupt but at boston university, there's a domer that's like a five-star hotel for c-gate rooklyn. >> let the schools provide additional incentives to try to bring people in so the schools are competing with one another? >> that's what they're allowed to do and everything else. if they want the top scholar for

their depradge what schools, they could give him a package, special benefits, housing, nything they want. >> the ncaa is a cartel. they want to stop the high revenue schools in these sports for being able to compete. >> but nfl and mlb have salary caps for sergeant that purpose to keep these smaller teams from being disadvantages. isn't that fair? >> that was negotiated with the union. or in the settlement of an anti-trust litigation. if the ncaa and the conferences wanted to negotiate with a union and worked out a salary cap or if they wanted to settle any anti-trust litigation and work out a salary cap, that could be done. >> ok, carlton college of minnesota doesn't want northwestern to go through with this deal. what does the rest of the big ten or big 12 or whatever it is, what's the back story within this vote today?

do the other schools want this? >> it's very interesting. five power conferences have a proposal right now before the ncaa to break away and maybe run themselves on these very issues because they perceive that it is unfair, i believe, that they generate all this money and they can't even feed their players, feed them as much as they want to. >> howard, your thoughts on this. you've lived this at northwestern. >> you know, i don't know how you get around who gets paid what, how much do you get paid and if you have a free market, how do you prevent the very biggest schools with the most money from dominating the athletic field. and northwestern wouldn't have a chance against the michigans and the ohio states, not that they -- >> you got through whole whole thing without mentioning the evil notre dame as well. >> jeffery kessler of c-gate,

brooklyn. >> let's get your data check. we've got university of michigan coming out at 9:55. looks like we're going to have a lower open. futures down. ♪ >> good morning, everyone. look for all of our interviews, our conversations across our bloomberg digital product including bloomberg radio plus. i'm tom keene with me. scarlett fu and adam johnson. honored to fwreng you howard ward after this tumultuous use f apple. >> colleges have selected their class of 2018le and these incoming freshmen need to decide on weather whether to enroll come fall. before the ink can dry, soon to be high school seniors are knee-deep into s.a.t. prep.

last time you came on, it was because the s.a.t. overhauled its exam. talk to us the standard of a test like this. does it offer a benefit or is it a college entrance exam used to boost college rankings? >> thanks for having bemack. the s.a.t. is a test that is a porthole test for college admissions. it has a couple of different purposes, one is to give a standardizing metric for students across the country so that grade inflation, for example, will be diminished. and the effects of inflation be diminished. the s.a.t. also has the purpose of serving as a college readiness exam. and the big changes in the s.a.t. have to do with the disjunction between the preparedness of students for college and in fact, by the time they get to college, they find out that they're not prepared so the s.a.t. actually gets them

ready. >> but a lot of colleges increasing or making those s.a.t. scores optional. is that a good or bad thing? >> the s.a.t. is a good test in general. and the evolving changes are good. it's becoming more rigorous. optional, a lot of the colleges have decided to do so because of the criticism of the test but the changes are moving in a good direction, generally. >> my experience with three kids as a tester everything. and then there's the psat and soon the ppsat's. eighth graders take the preliminary exam? >> it's the 10th graders that take the ps.a.t. it's a preliminary test. it's sort of like the s.a.t. >> to get you ready for it? >> to give you an idea of where you stand. >> what's the best practice for parents in getting their kids coached for this stuff?

>> long term rigorous preparation is the best way. >> just make the kids grades? >> to get a good score, it's not going to happen by itself. there are some people who are gifted but it's not an aptitude test. it's an assessment test. so if you prepare in the long run, you'll get better. >> there is linear algebra on the s.a.t.? >> lynn ya algebra -- there are linear equations. >> i'm all over that. > i guess you are. >> i think you would do terrifically well. >> what an absurd game you've got. s.a.t.'s, practice s.a.t.'s. you've got grade inflation and yet they're dropping -- >> but that's why the s.a.t. -- >> that's the game. >> but now we've already prepping for it and yet they're dropping the writing. why are they dropping the writing which is the place where people distinguish themselves?

>> it's an option test. it's an optional essay and it's going to be more difficult and challenging. it's a 50-minute essay instead of a 25-minute essay. i would take some exception that it's a game. what we're trying to do generally and in long-term preparation is elevate the standard for preparedness for colleges so what we have is a lot of students preparing anding better and it's an educational uplift for the entire society. if we exit commit to that, we will get better. >> i was looking at the bios of your tutors and it's pretty impressive. science, yale law, how do you get these high pedigree guys tutoring students? is it a sign of the times? >> sign of the times is people are looking for emotional ress ans in their work. that's a very excelling aspect

to one's job and it is highly compensated. >> very necessary in this room. coming up, u.s. secretary of state john kerry says russia is running out of time in ukraine. ♪

>> the rate of growth of data that is generated is phenomenal. it's incredible. in order to get value, you need to understand the data and what it means. you need to understand your business. you need to understand what data bears on your business and have some ideas of analyses. conduct experiments, it's a science.

>> with us right no, -- now, it's betty lui. what do we have? >> ben kaufman, a quirky founder and c.e.o. -- i don't know if you've seen any of their products, guys. >> the name of the company is quirky? i thought he was quirky. >> >> they allow anybody who has an idea, you or adam, or scarlett. they may collaborate with you to bring that idea to the market. they've got lots of products and targets with bed bath and beyond and last year, they partnered with general electric. >> and you have some guy at harvard as well? >> larry somers. >> yeah. >> of course. yes. you threw me off for a moment. yeah, he's going to be joining us. they're releasing their product that has been collaborated on with g.e. >> betty lui, thank you so much. 8:00 with lawrence summers of

harvard. adam? >> earnings edge. are you ready? here's some earnings edge that are going to come out. we've got g.n.c. and lion's gate. if you spin it forward and look towards monday, you've got charter communications and herbal life. herbs life. and in the ongoing battle between ackman and icahn. one says it's a fraud and the other says no, it's a real company. > all right. we're talking about colleges, college prep. aruin, advantage testing has been around for 28 years now. college tuitions have skyrocketed here and people are questioning the prices. just what have you seen in terms of the change? how much more competitive is it now? it's certainly more competitive. you know, one misconception is that these aye see league

colleges, for example, are inaccessible. in fact, they have very robust financial aid packages so the average student, for example, who goes to princeton university and is on financial aid is paid $50,000 on graduates without a loan. >> these are elite schools. just to pick one access, these kids are not going to get that package. they're going to have to write out -- ride out $45,000 or $50,000 a year. >> $60,000. lone was -- m my loan was greater than my father's salary. we believe in the central of education. >> very quickly. do you believe in the s.a.t.'s? >> yeah, i do. the rich kids gel -- get lots of

one-on-one tutoring. is there a online low cost high quality tutoring application that the less privileged prospective college students can use? >> delighted to hear that question. the college bhoords partnered th the conn academy for free online work. >> please come back. >> thank you so much, aruin. ♪

>> our guest host is howard ward. all right. let's get you some company news now from the files. amazon don't seem to mind that interests are rising more than revenues. shares are higher. and also expenses both increase in% in the last quarter. the company has been building warehouses and adding new services all of that eased into profits. ali baba make -- may make its i.p.o.'s the biggest ever. that could push the size of the

i.p.o. past $20 billion. the all-time record is $22 billion in 2010 for agricultural bank of china. and shares of pandora falling. it would spend aggressively to defend its lead in online radio. that is expected to hurt profits in the first quarter, pandora spent 63% more to attract and keep listeners. >> good morning, everyone. good friday morning to get you ready for the weekend. let's look at the banks. where game four 2009 with 20-20 hindsight? it was a no-brainer. bank stocks did a moon shot. and in 2014, see what bank of america talked about today. now with the financials. howard ward is with us looking at value, looking at industrials, looking at the might of america are the banks, pat of his optimism. do you like the banks? >> you know, i think they're

uninspiring, you know. the fire sale is long over. the big increase in earnings isn't there. it's not that attractive. the lending business is not a growth business. et's be very clear about that. it's not what it used to be. i think you can do better elsewhere. >> if they are a utility business and you do better elsewhere, does that mean utilities, if i don't want to play facebook or that upstart google, where is the safe that the banks used to be? >> you know, there's risk in all of the markets. so the banks, wherever that safe value either. so, you know, i just think that there are lots of more attractive areas in the markets than the banks. >> well, here's one number that jumped out of me from the federal reserve.

is there an argument to be made that plays into your industrial theme where you buy banks that are loaning to central companies out in the heartland? >> well, you know, let's remember that yes, c and i loans are at an all-time high. that is important. but the very largest companies don't really borrow from their banks too much. >> but that's a key point. in america, we have essentially jumped around the banks unlike in europe. >> right. the big companies don't really need the banks from us these days. >> then who needs the banks? >> the middle, small business. so a ball bearing manufacturer with 40 employees out in toledo. whatever. >> yeah. but there's a large number of companies that fall below the fortune 500 that use their banks. >> to what extent could we look at the bank for what's happening in the overall economy in markets? >> the banks have become such an

almost tentacle of the federal government that it's very hard for them to grow the way they used to it's very hard to get a home lon -- a mortgage right now. you have to probably sign 40 different pieces of paper the litmus test for passing the grade is unbelievable. so, you know, we wonder why housing is doing what it's doing. how getting a mortgage these days. >> explain how the media gets all lettered up about millions and billion dollar fines and morkt pro deposs yeah, ok, great. that's news. so what? why is that? >> it's a one-time event. you don't penalize the stock like that. >> to be fair, it feels big for some banks. >> we're penalizing the shareholders who have nothing to do with this. that's unfortunate that the shareholders suffer when the banks business went down the drain.

>> so you're equating that dollar for dollar that was buy-back? or shared >> yes. the shareholders have been hit multiple times here. i think we're still early on in the mna wave and the i.p.o. wave. if you look at the number offense the i.p.o.'s, it's half of the market. and things are building. we're going to reach that point but we're not there yes. >> a report was talking about how six out of the eight recent tech i.p.a.'s priced at the lower -- i.p.o.'s at the lower

nd of the range. >> the pull-back in a number of the higher flying tech, social media and biotech names was 20%. now those stocks had done very well for the most part so it was overdue to have that pull-back and it scared people so if you were trying to come out with an i.p.o. in the last few weeks, you were coming into a hostile environment for those technology stocks. >> one final question. it's interview season. what do you look for as a candidate to work from gamco? what do you look from a kid who walks through the door? >> going back to the s.a.t.'s, mario looks at your s.a.t.'s, folks. he wants those s.a.t. scores and that g.p.a. very important. >> wow. >> he was number one in his class. and he is a great believer in education as the leveler in society. >> yeah. >> so you know, for hungry and

driven with great s.a.t.'s. >> there's your lesson for this friday morning. let's get to the agenda. and tom what, are you focused on? >> i'm looking to what i was not focused on monday and tuesday and that's ukraine. you saw it in the secretary kerry's face this morning and the president disrupted on his trip to asia. different headlines coming in stay tuned to bloomberg television through the day as they go into the ukrainian weekend. this was very difficult. i think we underplayed that right now. >> yeah. that's right. my agenda, president obama as you just mentioned in asia. so he leaves japan without any sort of trade deal. >> a disappointment! >> admittedly, a disappointment. but what he did do was tell the japanese that the u.s. is with the japanese on the disputed islands but china not happy about that. so now, he's in south korea. what's he going to do in south

korea? is that also military statement where he's got the north practicing as we speak? what comes out of south korea? >> well, i'm looking ahead to ford's conference call. takes place at 9:00 a.m. this is after the company reported profits that missed analyst estimates and warranty costs. and bad weather. we want to keep an eye with what happens with mark fields. will he be the next c.e.o.? >> i'm fascinated to what they see about the american economy. this idea of where is nominal g.d.p.? it's a strea. we've got deutsche bank, hugely optimistic. >> hugely. and a lot of other people not sharing that. >> well, having said that, ford afirmed its america profit forecast for the year. that's one indication. >> i got an e-mail that i said fascinating too much. i'm sorry. >> come up with a new word. >> no, but i'm fascinated by

where we're going. >> we have a fascinating twitter question of the day. are college athletes worth more than scholarships? northwestern football players voting to join the union. here's an answer. college is not for minor league. it's for learning. repeat chemo the classroom seats for student who wants to learn. >> traditional view. >> based upon the seeker deal, the coaches say yes. based upon the schools make for tourneys, yes. imagination runs wild. >> so cynical. >> i'm shocked to learn there's gambling in schools. >> i thought jeffery kessler was very upfront about market forces. >> yeah. howard ward, northwestern alum. are you paying close attention to this as we head into the vote? >> not really. it's not the most important thing on my radar but it's a complicated subject. and they'll straighten it out.

and go cats. >> go cats. >> go to the rose bowl and then we'll pay you. >> "in the loop" on bloomberg television is next with betty lui. have a great weekend, everyone.

captioned by the national captioning institute --www.ncicap.org-- >> good morning. it's tgif. you're in the loop and i'm betty lui. we have a great show with you today. larry summers will be joining us and we'll get his thoughts on

the economy. and the impacted sanctions in russia. and are you dying to get an idea out into the marketplace? listen to what quirky c.e.o. ben kaufman is going to say. he helps inventers bring their products to the market. and he partnered with g.e. and dixon doll flying in from san francisco to be my co-host ater on the program. the u.s. and its european allies may be on the verge of imposing more sanctions against russia. president barack obama is in south korea and said he will talk with european leaders today about the crisis of ukraine. it will pave the way for sanctions against key russian industries. >> it's important for us not to anticipate that the targeted sanctions that we're applying now necessarily solve