♪ >> from bloomberg world headquarters in new york, i am mark crumpton. this is "bottom line," with a main street perspective. today, the u.s. releases its latest u.s. climate assessment report, and bayer agrees to buy the consumer unit of marks, and remaking the chrysler jeep and alfa romeo. ♪ to our viewers in the united states and those of you joining us from around the world, welcome. we have full coverage of the stocks and stories making history today.

there is the purchase of the merck consumer care unit, and we update the growing crisis in ukraine. we began with phil mattingly at the white house and the release of a new national climate assessment. phil, good afternoon. what does that report have to out >> the assessment lays all of the potential effects of rising temperatures, rising oceans, and climate change that could lead to more than 50% of u.s. citizens in an increasingly vulnerable state. the report breaks down region by region how changes in climate are actually impacting the u.s., what white house officials call one of the most robust scientific reports ever to come out regarding the impact on the u.s., and one nor double one -- notable one is that the northeast has seen a 71% increase in heavy snow and rain. report lays out how damages

may impact agriculture, water supply, overall economics that may cost in the billions, mark. what is the white house trying to do at this time with the release of the report? >> the white house is really behind this report for two primary reasons. one, they hope the credentials behind this report, more than 300 scientists, meteorologist involved in the creation of this report, will help settle the debate over the science. they have constantly been fighting with republicans on capitol hill about whether or not climate change exists. this report settle that debate while sparking a new one. white house officials are aware that if you look at polling, climate change and solutions to address climate change have fallen way down on the list that people care about. home and this will hit maybe spark some move forward to

press for changes going forward. correspondent phil mattingly joining us this afternoon. phil, thank you. reports that four government soldiers and 30 separatists died in the latest violence in eastern ukraine. 30y seized more than installations in the eastern in the meantime, energy ministers from g7 countries are meeting in rome to discuss europe's energy priorities, and let's look at what that means for russia. we are joined from washington. stop russia from using its oil and gas as a political weapon, but with the eu and ukraine reliant on russian energy, how do they plan to do this? >> right. it is all about finding ways to diversify the eu gas and energy supplies, and right now, you have a situation where about one

third of eu gas comes from russia, so they are highly dependent, not as much as ukraine, but that gas flows through pipelines that go through ukraine, and there are certain countries starting with estonia going down to austria and ending in greece in the southeast that are as much as gas andndent on russian energy, and so the overall plan here was to diversify in every way possible, and our own energy secretary was there, pledging lng promising to expand u.s. exports, to basically allow for those exports to europe. although wiley said this could be a huge boon to europe's energy supply overall, it would not be possible because of the infrastructure until 18 months from now to begin, and the u.s. could not be a major energy supplier to europe until the end of the decade. eu andrussia hold the

u.s. foreign-policy hostage? >> this is a threat that everyone is worried about. ultimately though, even though the eu is so heavenly dependent on russian gas, i do not think people see it going that way yet. if russia were to cut off gas, it would be cutting off its nose itspite its face, because needs all of that money, and company like buys prom -- gazprom do not want to be involved, also rose next. and there is the assistance of the imf money that we all know about, so they are hoping to try to solve this problem this month before the next round of the trilateral talks are going to be taking place. >> we also heard today that russia is calling for a decree -- delay in ukraine elections.

what is the latest on the ground ? it was supposed to be this month. >> it seems that more and more, the main game of vladimir putin seems to be to disrupt and interfere with elections as much as possible, what u.s. officials are telling us. now, on the ground today, we sought increased violence, and they say it is spiraling more and more to something that looks like an internal war. we saw the russian foreign minister sergei lavrov talk about how he wanted to delay. the wanted a delay in elections, and we have the eu calling for another meeting in geneva to come up with something better since the last was not working so well, and there is russian polling that shows that although a majority of russians still believe that crimea should have been legitimately annexed, fewer and fewer of them are willing to their the economic cost for supporting crimea and sanctions. >> thank you. forof the 21 candidates

president of ukraine is in washington today. says the u.s. and russia hold the keys to peace in ukraine. he is asking both countries too, in his words, step back from the crisis. the candidate spoke to our chief washington correspondent, peter cook, and he joins me in that conversation. good afternoon. >> that afternoon. he is an economist and a former member of the ukrainian parliament and also an adviser to victor yanukovych, although he quit over the yanukovych policies. he sees himself as a candidate -- helpedlp divide with the divided country. they hope the president's reelection take place on the 25th, even with the recent violence in the country. is quite possible that the elections will take place. it is necessary for this to happen in order for us to overcome this crisis. these elections are very needed

right now. this will help us to create new mechanisms for overcoming the current situation and the crisis, and this bloodshed has to stop. continue forward on a democratic path if these elections happen, if the new government is legitimate. this trip, he plans to meet with u.s. lawmakers in congress and other officials, but even stopping here in washington, he says he wants brussels and all parties to step back and allow ukrainians to find peace on their own. specifically, he is calling on the u.s. not to impose further sanctions. very obvious to me that any new sanctions will only lead to greater financial burden on the entire world. i see no good prospects for sanctions here. new mechanismste for political dialogue instead

to normalize the situation in ukraine. ukraine can become a bridge between russia and the west. tothat is a message unlikely resonate at the white house, which is forcing -- facing more calls to turn up the sanctions, not to do turn them down. urge president vladimir putin to look at the russian relationship with ukraine going forward and to allow the country to be more of evenk, and they were promoting a judo match, both being aficionados of the sport, not clear if vladimir putin will do that. >> our chief washington correspondent, peter cook. and north carolina kicks off a month of contest today. the senate republican nominations, we will take a look at the contenders. this is when "bottom line" continues in just a moment. ♪

>> a green high capital management representative said he found ben bernanke frightening. in an exclusive interview with erik schatzker and stephanie ruhle, he said they met for dinner on march 26. years, youd him for know, in front of congress, speaking, and i watched him on tv and 60 minutes. >> what was your opinion of him before you had dinner was tumor >> i have been critical. i have been critical about him for a very long time. in one way, the dinner was cathartic, because i got to ask him some questions that had been in my mind for a very long time, and on the other hand, it it was frightening, because the answers were not any better. thee has been critical of bernanke willingness to leave interest rates near zero for more than five years.

messages left for bernanke at the brookings institution were not immediately returned. and a contest for senate republican candidates that will define the balance of power between business-oriented candidates and the tea party movement. the cofounder and president of fromlpha partners joins me washington to set the stage. >> thanks so much. ask, the north carolina primary, is it a fight for the direction of the republican party? >> well, i think that is a little bit strong, but it is certainly a fight with the republican party. you do have a competition between the tea party candidate and the evangelical candidate and a more established candidate, tom tillis, who is the speaker of the house. you mentioned mr. tillis, the north carolina

speaker of the house, and he has the backing of heavyweights, including mitt romney, and he is backed by an techie senator rand paul, and another has support of mike huckabee. outhas this battle played so far? >> well, so far, it looks as if mr. tillis has somewhere very close to that threshold level of beut 40%, at which he would able to avoid a runoff, which would come on bastille day, july 14, and that is one reason there has been so much immediacy to this, because republicans have sort of a stinging memory about the fact that they were perceived to be in line to win as many as two to five seats in 2012 and ultimately lost two seats, in no small part because they nominated candidates who really were not viable in the general election. football,istake free mr. tillis is, again, and

established candidate. it looks like he would do better against kay hagan, and that is why you have a lot of focus on this race, but it is interesting that rand paul, a very credible candidate himself in 2016 as a potential republican presidential candidate, has actually been stumping for another. >> the irony of bastille day. of theproviding most outside money for the primary, and which candidate seems to be benefiting the most? >> well, i think a lot of the big pacs, like crossroads and others representing be established republicans are probably reviving the most. there is probably some tea party funding for mr. brandon. i do not know if evangelicals were helped along by mr. huckabee, former governor huckabee, who has really stepped up to the plate for harris. >> sir, i would imagine that their message just cannot be

that whatever president obama is for, we are against. platforms?eir what do these candidates stand for? >> that is a good question. i do not think it has been very easy for them to differentiate themselves, and it would be difficult for tillis, for example, to say i am more electable, a more established candidate, and i think the biggest fear in this primary and, frankly, another couple big ones, particularly in georgia -- for instance, on the 20th, and in kentucky, and then, frankly, moving onto alaska later in the summer, is that they do not want to have a nomination cycle wherein you will have either a nominee or a competitor that will make sort of impolitic comments. the fear is if we have a runoff necessitated by the fact that mr. tillis does not get the 40%, you could have mr. brandon, for

or, you know, harris make some comments that would call some negative attention all while they hagan, the incumbent democrat, can conserve her resources and have a civil war in the republican party. that is what they are trying. mentioned kay hagan. how vulnerable is she, and will her support of the affordable care act hurt her, even though health and human services secretary kathleen sebelius has have signedericans up? >> she is extremely vulnerable, and i think it has been trailing most of the democrats in the polls, and a key thing, as you know, republicans now have 45 55, and joeocrats' biden would break a 50/50 tied. they get halfway there by having basically easy picks in looking and southrginia dakota and montana, where three

democrats are retiring, so they need to win three out of four seats that are really seen as low hanging fruit on the tree, and in addition with north carolina, we are talking alaska and another state. >> georgia, i think. >> no, it is not georgia, but louisiana, arkansas, excuse me. mark pryor in arkansas, and they need to nominate their best possible candidates and make no rhetorical mistakes, have all of their ducks in a row and get a little behind their backs, which looks like they can do. they are ahead in the polls, but there is very little room for error, and that is why there is this sense going into this. ok, my guest joining us from washington. a pleasure to meet you. thank you for your time. >> thank you. >> coming up next, we go on the markets with alix steel, and

also, laying out a five-year plan for a merged automaker. we will take you live to michigan a little bit later when "bottom line" continues in just a moment. ♪

>> another day, another big deal pharma, the second-largest consumer help transaction in one month with they buying a merck division. bayer buying a merck division. has a very strong position in other countries across the world, reticular me in emerging markets and in europe, so we will take the

brands and bring them to other geographies, and with that, we will create a lot of revenues. >> with more on this story, we are now joined by cristina alesci. what does this say about the people in the industry now? >> all of these countries are trying to find a way to survive in a world where they are not selling the one block after drug, like viagra or lipitor. -- one blockbuster drug, like viagra or lipitor. focus on what it is really good at and sell the assets it e, for,rs non-cor example, this unit that we have seen them sell to bayer. also, they have announced they are going to cut about 1800 people to save $1 billion, and this deal will give more about eight dollars billion, $9

billion in proceeds. what are they going to do with all of that money? they are going to focus on higher margin drugs. the head of r&d says they are going to go into biotechnology drugs. they are investigating -- investing in a hepatitis c medication. they are investing in cancer medications, and this is what we will see merck focus on. >> are they acting on desperation? >> there could be an element of that. desperation, i think, how much money did bayer surrendered to get this asset, and if you look at multiples on cash flows, it is 21 times cash yer is paying for this merck business, and that is twice the valuation it had. that can be an indication there is an element of desperation out there. it was a hot auction.

people were talking about $10 billion, and it went to 14.2 billion dollars, so there could be a little bit of desperation out there. >> all right, 15 unless she, thanks so much. coming up on 26 past the hour, and that means it is time for on the markets. alix steel is standing by. >> first, i went to get you caught up on the broader markets, because we are continuing to see stocks deteriorate, the s&p trading near the lows of the session. you are seeing really financials lead the way on the downside as well as consumer discretionary, energy also giving up some of their gains, and twitter, the shares of the microblogging site are slumping to their lowest price since their debut, coming after trading restrictions were lifted on about 480 million shares held by insiders, and we want to keep our eye on netflix here, a very interesting story coming out today. the online subscription service

has reached a deal to extend its 1.4 million tivo, customers who use the that top box of tivo. we will have a look at the markets again in 30 minutes, and on the otherline" side of this break. ♪

♪ >> welcome back to the second onf-hour of "bottom line" bloomberg television. i am mark crumpton. thanks for staying with us. let's look at some of the top stories we are looking at this hour. credit suisse is getting ready settle a tax evasion case, and the government has been cracking down on foreign banks that help americans even a taxes. delta airlines will be returning more money to shareholders. has boosted its dividend to 50% and also authorized a

stock buyback plan since shares have doubled in the last year. is recalling some saturn midsize cars in the u.s. because the automatic transmission can fail. it involves some cars from the years with08 four-speed transmissions. they will replace the cable and mounting bracket at no cost to the owners. that is a look at the top stories in the news at this hour. today, the fiat ceo is laying out ambitious lands to boost others.eo, jeep, and the plan was described as bringing all the various pieces of the mosaic together. miller is inatt michigan, where he attended that meeting, and, matt, you were just listening to him speak.

how was the reception so far? the reception has been pretty good. he has been mingling with the investors in the room, hanging onto his every word, and he has of the brandse with him. the interesting point so far is they have been the italian parts, especially out for remail meo, which hasa ro in the last decades. there is the surprising little sports car, only bringing 1000 of those to us this year in the u.s., but over the next few years, he wants to not only restore the brand to its former lori but also massively boost sales. he expects to sell 400,000 of them in 2018 and introduced eight new models with over 5

billion euros worth of investment, so a real push to alfa romeo back into the brand and make it a high-end brand, like audi and bmw. that is going to be a huge part of the story, and a lot of people are wondering where the money is going to come from the investment. for ari, we thought maybe an ipo, the sale of a unit, one of the most recognizable brands in the entire world, but he said, make no mistake, we will not be selling ferrari. ferrari is not for sale, so that really answers the question we were asking him. and it is not going to be up on the block. >> what about the american brands? did we hear anything about that? >> a have been very successful

with their jeep sales, incredibly successful, and it is a high margin brand for them. jeep,han doubled sales of over 700,000 in 2013 to almost 2 million in 2018, but they have had trouble, really struggled with chrysler and dodge, as far as defining these brands and putting some growth into them. chrysler may want to aim at kind of a mainstream american. luxury, but it is also not low cost, so they are going to make that the mainstream brand for middle america, and then dodge, and one.r, sportier take away some segments but make it kind of an edgy brand. interesting, but a very ambitious plan. >> bloomberg's matt miller in michigan at that fiat meeting.

and coming up, pledging money to support veterans. i will speak to the vice president of global philanthropy about that and efforts to help american veterans and their families. ♪

it is time for today's latin america report. with just over one month until the world cup kicks off in brazil, we paid a trip to the adidas innovation center in germany. the sportswear brand is the official partner of the tournament, and we found out what goes into making an iconic tournament football. >> for football, the fans, the players, they are very emotional. symbol of the, a event. let's talk about brazil. the official match ball of the fifa what he 14 world cup.

countries,ayers, 10 with 26 different teams. the ball is six pounds. shaped, and this is the first time we have done this. when the ball is flying, it has a very nice, consistent rotation in the air. we do a great team -- a righty of tests. we want to make sure it does not absorb water and that it is consistent over the course of the game. big ones is really getting the play is used to the ball and how they feel about it, and the comments we received back were very consistent, very predictable, very playable. the method that we used to create the ball is thermal bonding. it is something we have

perfected. the ball is consistent, has very good shape, and it has excellent lability -- playability. does not win or lose. >> and that is your latin american report for this tuesday, may 6. jpmorgan recently pledged money over the next years to support u.s. military veterans and their families. upon thege builds firm's existing programs focused on education, employment, and housing for vets. manager at thep office of global philanthropy at jpmorgan chase joins me now, and welcome to "bottom line." your time today. >> thanks for having me, mark. >> this is personal for you. you were honorably discharged.

what was it like for you when you came home? what was the support like? >> i came home multiple times over every workforce, and what i saw was an adjustment, but one thing that stuck out was that everyone was there to support, coordination.no that is why we are proud of our mission, where we put together companies who are focused on hiring veterans, share best practices, and today we have made that commitment and have blown it out of the water and have gotten 117,000 so far. >> was there a moment or an episode that led you to say, i have got to do this, i have to be a part of it, i have to look out for my fellow vets, and i have to make this my life's work? >> when fighting, the individual to my left or right, they were my life line. taking care ofn them because they were focused

on taking care of me, and what we realized is that that translates well into the corporate framework, a sense of teamwork to accomplish a single mission. it has been able to identify that veterans are a fantastic asset. >> tell us about the side of the -- size of the budget. $20 million. what does that say about the size of the problem? does this nation do a enough for its veterans question the >> as i said, there is a lot out there, but it was not well quarter needed, so jpmorgan signing onto this pledge, that 20 million dollars, while it is fantastic, it is a drop in the bucket when you look at the overall issues that the servicemembers and their families are facing when they come back, and we need to make sure we stay focused on these issues in the years to come. we want to make sure we continue to invest in this community. thes you mentioned,

transition to civilian life is not easy. the daily structure of military life is gone. the concerns of finding a job, taking care of your family. they are always present. there is posttraumatic stress, and then there are the issues of learning to live your life after the loss of a limb or more. how does it help them make these adjustments? >> it comes in many ways. we have got national programs that support veterans. those who have been wounded, as you mentioned, and those who have not been wounded. the transition is difficult on intor side, but also we go the communities. helping those who need help finding employment. just because you live in a big city does not necessarily mean you have access to those things. you may not know they are there. also, in a rural network, you may not know. there is a program that we have come together with these other

organizations to say, let's work together. let's find out on a local level and a national level that the folks are getting the benefits they deserve, have earned, and more importantly, in a timely fashion. >> who else has answered the call, and what kind of momentum is it giving in corporate weices around the nation? >> are hoping this is a start and that it will grow. the maier squibb corporation is one. they are a partner in the jobs mission, as well. we have all of these different groups who have a priority focus around veterans, but they want to make sure we are doing it right. there are a lot of different tools when you get out of the military, and it can be incredibly overwhelming, so we want to make sure we are filling the gaps when they needed, and it really comes down to good timing. less than a little one minute, but i have to ask, what has been the reaction of the families and the vets?

>> fantastic. they see that jpmorgan is focused on them, and when i joined the military, i enlisted, but my family got drafted, so we are very proud we are combining spouses and caregivers. it is an encompassing program to make sure we have every aspect of support. >> the military and veterans affairs relationship manager at the opposite global philanthropy at jpmorgan chase, joining us from washington. thank you, sir, and thank you for your service. >> thank you, and thank you for having me. >> acrobats, coming up. ♪

shuttle aboutnew to take place, but nasa will not be doing it, private companies will. shuttle, bloomberg got access to them, including a tour of spacex, with ceo elon musk.

>> the first time we were racing into space, it was about national pride. >> the eagle has landed. >> this time, it is about money. stationrnational space is a near zero gravity laboratory dedicated to scientific research. the nasa shuttle program world with only one way to get there. russia. >> millions percy just to go to the space station. was bad that america had to bum a ride from the russians. >> but soon, others will be taking flight, but nasa will not be making it, private companies will. are building this in anticipation of a market emerging. >> nasa is hosting a competition for private enterprise to build a spacecraft to shuttle humans to orbit, and

that contract will be worth billions. >> i think commercial space they is much like back in late 1920's and 30's. it is being enabled by the government, but eventually, it will take off. competition is stiff. >> boeing, spacex, and sierra nevada, and the stakes are high. all multibillion-dollar aerospace companies, each determined to win the nasa contract in order to become the leader in the emerging space industry. nasa has been outsourcing work to private companies since the start of the space program among but with this new contract, they become the client instead of the boss, with private enterprise assuming all of the physical and financial risk. >> every spacecraft that has ever flown has been built by a commercial company. this is just another way of

procuring the spacecraft. i am convinced we will have a reliable spacecraft. >> the more we test ourselves and the more we push exploration, the smarter and the better we will be. >> it is in our dna to explore. we can go beyond what we currently know. >> and be sure to tune in to bloomberg tv at 9:00 p.m. new york time as we take a look with an in-depth journey through the booming business of space exploration. and it is time now for a look at some of the most compelling , hot shots.e day 2 million u.s. dollars, to be exact, authorities stopping a van along the highway and finding cash hidden in a compartment. to make sure everything was they counted,

until nightfall. police are still investigating to whom the money belonged. shine, this vendor from the eastern part of china bearing bean curd balanced on his head while riding his bike. to wheree has gotten he has forgotten how long he has head,alancing tofu on his ad still in china, maybe not michelin star restaurant but still some bragging rights. balancing on a unicycle. he said it is more important to have a job that you love. ok. another check of

markets on the other side of the break. "bottom line continues in just a moment. ♪

headlines attest the top of the hour on bloomberg radio and streaming on your tablet and on bloomberg.com. does it for this edition of on bloomberg television. i am mark crumpton. next.e markets" is

the hour, andst that means bloomberg is on the markets, the nasdaq off by about one percent, the s&p off by 7/10 of one percent, and picking up a little bit of steam to the downside, and commodities, taking a look at natural gas, it was actually clawing its way see morend you will demand for both heating and cooling fuel, so a double whammy there. and a quick check in on oil. about $.15. it was up even more during the day, above $100, basically, and eia, the energy information agency, raising their price forecast, and oil and gas are the focus of today's set to report, an all-time high today gaine boomlet continues to

momentum, and pipeline companies are so eager to get in on the action that they are building networks before getting commitments from those that will actually use them. we looked into this new trend, wouldining me now, why companies do this? it seems to me it poses a huge financial risk for them. >> additionally, the way it is done, a driller goes in, and they look at the area where they are going to start producing, and before a pipeline company commits to building a pipeline there, they want to make sure that the producer is going to pay them even if they do not. thehe money to build pipeline. >> exactly. >> what about now? >> the pipeline business is getting a lot more competitive. a lot of them are backed by private equity, and there are partnerships, so some of these, gettingroducer goes in,

10 offers, with that amount of competition, one of the ways that they all want a piece of this action and the way that they are going to get in there, they are saying, we will take some of that risk off of your hands. you do not have to commit, but whatever you pumped out of the land, make sure you put it through our pipeline. >> x years old, is it forecasting the next big thing? ,re they looking towards oil railroads, competition? what is it talking about? >> everyone is looking for the next big play. the thing about these shale rocks, they are productive, but production drops off fast, so you need to have new ones to see the growth that investors want, that means that investors are looking at new areas where they want to drill, and the infrastructure is not there yet. for gass come you really cannot do that at all. and eggrt of a chicken problem. before the producers can really

start pumping, they need the infrastructure to be there. >> you raised the question of sustainable shale. how sustainable are these pipelines? contracts, and they were going to get paid no matter what, and now, it is basically getting more competitive, it's the producers are happy to do. >> i am sure they are. we appreciate you bringing us that pipeline update. more on the markets in 30 minutes. "street smart" is next. ♪

pressure stocks under right now, falling for the third time in four days. also twitter seeing its shares slide to the lowest levels since its first trading day. "street smart" starts now. welcome to the big show, the most important hour of the session, 59 minutes until the closing bell. walmart is stepping up its e-commerce game. online sales growing