fantastic. it's kind of tricky. people are hoping the growth will accelerate but not too much. so much fornk you providing perspective on the fixed income markets. again on the markets once in 30 minutes. market makers is up next. ♪ clock slide from bloomberg headquarters in new york, this is "market makers with erik schatzker and stephanie ruhle -- from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> steve ballmer, we know what he is doing. he won the bidding war for the nba los angeles clippers. record $2 billion. we will be asking questions. let the force be with chicago

or san francisco? this two states are locked in battle for star wars.ted to it is friday in new york city. stay -- how do i say i am stephanie ruhle in spanish? they will be a rate friday. -- it will be a great friday. time for the news feed. let's get serious. from around the world. president obama is meeting at this hour with the veteran affairs secretary. a serious have conversation about the ability to deal with mismanagement problems at the va hospital. more than 100 members of congress have asked obama to fire the head. lions gate could use another hunger games. the hollywood studio reported results that missed estimates.

ishares opened a bit lower this morning. and former ceo steve ballmer has found something to do in his retirement with all that energy. he won the bidding war for the l.a. clippers. he will pay a record $2 billion for the nba team. nba owners were expected to force don sterling to sell the clippers. >> $10 billion, that is how much prosecutors want a french bank to pay among criminal allegations of violating human -- violating sanctions. not far off him a $13 billion that jpmorgan paid last year. is here to talk to us about the rising cost of criminal activities. it is significantly above the rate of inflation.

>> we have doubled it since a week ago. $10 billion is so big. it is so much bigger than other bank finds we have seen. we are still not really sure what is at the root of this. we haven't seen a love of evidence. i can't wait for the complaint to come out when they do settle this. i am looking for to seeing what about this case lawrence 10 billion dollars. analysts are saying the bank can take about $7 billion before it starts to impact capital ratio. >> this is well above that. there are pretty tough negotiations going on between the bank and regulators and the department of justice right now. >> we have rocked the issue of what it is exactly they did settled aause hsbc similar set of allegations. we don't need to go into a whole lot of details about it. they did a whole lot of thought. . -- of all.elieve

. -- of awful stuff. really is a case of when are we going to find out exactly what bnp did? french authorities have said bnp rules oriolate any regulations. transactions, dollar rules. the government is coming down very hard. >> if you want to do business in america you have to play by the american rules. >> people are asking now if this is overstepping the cost of doing business. i think e&p is going to have to ask itself what we were doing in terms of the business you were doing and if it was worth the $10 billion fine. does the department of justice have to explain how they came up with that number? critics are saying this feels -- $10 billion, let's pull this number out of an airplane these

are the most evil fatcats out there, let's take a giant number. do they have to justify and explain how they came up with that? >> not necessarily. this is a number that comes from negotiations. they do look at what the bank can take punitive -- can take. >> why not cash and if you are the doj? -- cash in if you are the doj? >> cutler was the former head of enforcement. on the other side come extracting penalties out of banks. not that long ago when we saw numbers like $10 billion this is what he had to say. what stevend to cutler had to say in a moment of frustration. -- let's remind you what steve

cutler had to say in a moment of frustration. what is another billion? to a trillione and i think people lost a sense of how much money it really was. >> we hate the banks that they took this money and nobody is going to hang -- to hate the government. really is a feeling that banks are down. they do not have any leverage with regulators. withreally just have to go the pressure that is being put on them. at one point they have to be like ok, we have to pay and go on. it seems like they got off easy with the $2.6 billion fine. they really do seem to be putting forth this back to business let's get back to normal. be cut to see what happens with bnp. this number could affect their bottom line. >> always great to have you here. banks and the law

here at bloomberg. it >> moving onto retail. target is still reeling from that data breach last year that left him vulnerable 40 million credit card customers. john mulligan has been handling the fallout since he took the reins earlier this month. spoke to bloomberg tv earlier this morning for an exclusive interview. us take a look at what he had to say. >> what we have done is unacceptable. nobody feels that more than the team up there. we have a new leadership team that is focused on fixing technology and supply chain. the we are looking at everything we have done there. the assortment, the promotional cadence, how we promote, how we display the merchandise. it has to be holistic review of everything we have done. >> who better to ask than surveillance anker tom keene? he joins us now with more creative congratulations on the exclusive interview. what was your biggest take away?

>> my biggest take away was a chief officer acting like a chief executive officer. he was very direct paid he answered every question and added value. very direct. he answered every question and he added value. >> are you wearing new glasses yet though -- new glasses and? >> i cleaned them. i think the june 11 meeting is important for the to recalibrate as they go through the process of finding a ceo. it is obvious mr. mulligan does not want to be ceo. >> they also talked about this issue, how are they going to regain customer trust? >> we need to regain our trust. withd that we were pleased that in canada. we have work to do in front of us. to bring in julie hyman pitch has been covering

the target story. hyman.e she has been covering the target story. i am a big target customer. i want to look at the recent numbers. look at the recent bloomberg poll, showing most target shoppers are not going to change their target shopping habits over the next year. there are underlying issues with target. said he has three priorities, draw sales and traffic in the u.s. because they have not been good for quite some time, fixed -- six canada, and transform into an on the channel retailer. fix canada, and transform into an omni-channel retailer. if you look at them versus walmart, the perception of walmart is it is going like

gangbusters. it is seen rapid growth. the growth last year was larger than that of amazon but it was still dwarfed by amazon in terms of the online business. target is growing at a pretty good clip. at it is about two percent of sales. in an't john mulligan awfully awkward position, not just because he has and i in front of his title but because he has -- but because he is working for the board. this was a board just two days shareholders -- get rid of seven of the 10 records. >> i thought he gave -- with all the interviews he gave a very direct answer. he said this is a far more active board than the critics think. he is going to talk his book there. is they arenveyance on a short timeline. they're going to move this thing forward.

the most important question is what did he learn from jcpenney. he said they went too fast on everything. if that is the one message they are going to be a graduate us .pproach >> jcpenney was truly trying to change their brand. does targets need to? >> he says he doesn't. camera with tom is well. he said the problem over the last few years is we have been taking big risks and not taking the smaller risks. target has lost its mojo. we took a big risk going into canada. that's not go well. -- that did not go well. he says he is now refocusing on just basically shoving a lot of products into the stores. especially in test markets. and seeing if it works. take those small risks to shake

up the assortment. that is what made target. you wanted to buy what they had there. it lost that. how do you get it back? you see what works. it is a trial and error approach. >> i love target. it is a great store. and tom keene, congrats. >> coming up we will be talking merger mania, looking at what is behind them and eight at -- behind them and a activity in the second quarter. >> hedge fund shocker. not taking a chance on one of europe's -- europe's real basket cases. and they are scoring big. this is an on bloomberg tv. stay with us. we are streaming on your phone, tablet, bloomberg.com. we are on amazon fire tv as well.

>> the deal is that. so far this quarter $831 billion of them and they has been has beend -- of m&a announced. we are asking what took so long. and kenneth last? -- and can it last? why did it take so long? bankers have been telling us for years already. >> they have arty done reparations of the balance sheet. we were ready and nothing happened.

i believe the recession this last time was so deep that it took a long time for corporate confidence to return. mergers was a late cycle business for a reason. you have to wait until corporate ceos are ready to take the risk. >> have they been somewhat living in fear? there's more shareholder pressure and more threat of activist investors than at -- than ever. >> it is pretty normal for you to go through something really awful. 2008 was the worst thing they have gone through in their lives. it just takes longer. had -- we had all sorts of things that made taking on risk more difficult. when oil prices go way down it takes eight years for them to come back.

it a matter of time heals all wounds? it is not like the economy has turned around. of >> the economy is not all that much better. it is one of the places where people can get growth. >> do you worry at all right now, maybe we are getting too aggressive. timeyou are looking at a -- no one wants to be eating sausages and processed foods. i don't understand the social and financial message here. as we continue to see the strategic deals, the deals are when companies start becoming conglomerates. or when private equity gets really hot. 40% of the deals were private equity. financing got worst.

or if it happened they went into bankruptcy. we are not in a crazy. yet -- in a crazy period yet. this is the beginning of the merger cycle. 10 days ago krill shire was a $3500 talk -- he'll shire was a $350 stock. was a $350 stock. >> you can have huge synergy. if you look at the joseph bank transaction, they had the same amount of synergy then they had to begin with. was it crazy for them to pay a huge price at the end of the day? >> you think this combined the beautiful massive vanity play and they are worth all this? stocks -- bothes

companies stocks went up. >> when you look at the opportunities that these events present, how do you act? >> we love bidding wars. we have two bidders we automatically increase our position and increasing rapidly. position coming in yesterday and we increased the position yesterday. is thegest position result of a bidding war in canada. it was a relatively small deal but there were two bidders. going to think we're see more of these multiple bids for companies because of the pressure that the ceos are under to deliver earnings growth in a slow economy? clock's combined with a whole bunch of other factor -- >> combined with a whole bunch of other factors -- >> a shareholder like yourself

that cashes out when you're stuck gets tender, you are happy. do you think it will work out for the longer-term shareholders? >> as long as we retain strategic deals. strategic deals means you're or youn add-on product are combining two companies that are similarly face. >> can you give us an example of a deal you are looking at and say this makes no sense? a nonstrategic deal. >> a lot of the tyco deals. when they went into -- they brought -- they bought commercial credit, which is different than anything they have ever done. they use high-priced stocks and multiple businesses. it is the nonstrategic and private equity. private equity has, for the most part, they're not strategic. for the most part they are

nonstrategic. those deals are a little more worrisome. the only reason for being is financial engineering been >> thank you very much. have a great weekend. >> he is president of havens advisors. >> forget about priceless artifacts from the nation's history. there is a fight about where to put a new museum, the one museum i can actually get my kids to go to. one dedicated to star wars. we will be back in a few minutes.

>> it is time from bloomberg to take you on the markets. at msg.ed to look madison square garden, the company that owns the rangers hockey team, which beat montreal last might and will play in the stanley cup final, it also happens to own madison square garden. >> just wrapped up a multibillion dollar renovation. >> this is all about the clippers. steve ballmer buys the l.a. clippers. -- aupon a time a baseball basement plumbing fastball team. forenly they are available $2 billion, rewriting the book on sports franchise valuations. >> l.a. teams do not draw the crowds that new york crowds do because of the weather. if you look at the dodgers, they are known as a hollywood team. to see a price tag for this, what does it mean for an organization? it is a big positive. >> that sounds like a judgment to me.

>> i make them all the time. is now valued at almost $4.3 billion. >> sounds like a -- sounds again thinking fine. we are talking activism. stay with us. ♪

captioned by the national captioning institute --www.ncicap.org-- >> yes, it is a friday morning here on bloomberg television. >> time now for one of my favorite topics -- activism. the value vision proxy fight is heating up. activists from the clinton group is looking to oust top executives at the struggling home shopping network and are place them with nominees of their own like music titan. so will the campaign prove success nfl lest ask the man who s leading the charge, greg

taxon. help me understand. >> we've got a great group of nominees. tommy has got a lot to add to this business who we think brings particular insight in entertainment, live events, commerce and web base and television based commerce. >> why? you think the key is home shopping network style? bring in celebrity brands, have them sell their own wares? when i see iman on the home shopping network, i'm interested. >> right. that's exactly right. what they have done so expertly is to develop proprietyly brands that are unique to their channels and it causes viewers to come back and back again and to be loyal and to be interested. when you mix it with interesting pemple this and live events, you have the formula for lots of viewership and lots of commerce. and value vision has failed to develop these brands. having someone like tommy involved and others can help to

attract personalities and celebrities that will lead to interesting product and interesting brand that will -- >> and in order to do this, you need to kick out current management? >> our view is the management team has been there for more than five years. they've had a shot at developing propertyry brands and they have failed to do so effectively. our fear is in order bring this business to the next level you can't, rely on the current team. you've got to get a new team in there who has the vision and willingness to work hard to get the business to the next level. this team, by the way, 12 members of the senior management team of this company live at least 900 miles away from the company. and they fly in on monday -- >> j.c. penney style. >> they leave on thursdays and fridays. they're not working full-time five days a week at this struggling company. >> and you think tommy would? >> tommy's got a lot of energy for this. he's going to be a director if he gets elected and his job

would be to oversee those managers. >> greg, you're a very well spoken guy and it makes me wonder how important are presentation skills in this goldman-sachs age of activism? -- golden age of activism? >> do you need to be able to put together a killer 4 46 page deck and, you know, a super pervasive five-minute video in order to make your case? >> it's pretty important. we did a five-minute video with our nominees. part of what we're trying to do is to sequins convince our fellow shareholders that they should vote for change and voting for change is never comfortable and to get them there, wept to lay out the case in as clear a way as possible and in this case, we used video because we thought our nominees

show so well and have so much to say and so much to contribute. let's get them out there in three dimensions. >> i love the argument. where do you stand? so you made the video. you got the 4-mage pitch. what happened? >> the meeting is june 18. we'll know in three weeks. we expect -- i.s.s. and glass lewis to come out soon with their rec decisions. -- recommendations. it's up to share holds. >> when you look the institutional share holding in valuevision, how important is that to the way that you make your presentation and what you believe ultimately will be the response? >> well, let me first say the institutions in valuevision are good-looking, attractive, smart, wonderful people. no. we definitely look at them. we're interested know whether they're willing to change, how whetted to management they are. are they willing to entertain conversations about the future of this company? and we think value have been

vacation, you've got an investor based for creating values and re open to change. we love everybody. they're all great. vanguard does a great job. we have to concern that really, anybody on the list won't at least hear our arguments. and, you know, increasingly, even these investor types are open to anything that can help create value. it's one of the reasons why i think incumbent directors are so fearful these days of someone having an opinion because they know that people with opinions can persuade shareholders. >> if you're an incumbent

director at this point, shouldn't you wake up? the days of simply being a white-haired homeboy are officially over. if activism investors aren't going to out you, we are. >> the first rule of being a director is self-preservation, personally. -- apparently. >> that's seriously have volting. >> people say that to me all the ime. we find director who is think about how do i stay on this job? >> because it's such a racket? >> i'm not casting aspersions here but on the valuevision board, the chairman makes $417,000 a year. >> and how much does she have to work? 85% of it is -- work. >> what's the job? for $400,000, what is the job function?

are what are the hours? >> i don't know. >> give us an idea. >> last year, there were 20 or 30 official board meetings and there's check-ins in every week or month. but it's not a full-time gig. there are a lot of hard-working people who worked full time for $400,000. i count myself among them. we values a management team there, as i mentioned that some members are making over $1 million and flying in monday afternoon and leaving thursday on the 2:00 delta plane. >> amazing. >> so you have to wonder as shareholders, i've never seen a great business or met a great business where the management is strewn to the wind, flying in occasionally to kind of, you know, tough it out in the office for a couple of days. >> you've got to be in it to win it. >> it's not the way to build a successful great enterprise. >> i'm buying what you're selling, brother. >> i like it. >> greg, thank you for joining us. greg getting ready. what is it? >> june 18.

>> the valuevision board meeting. ouch. coming up. >> coming up as well, not on june 18 here on "market makers," the dispute that should be settled with light sabers. two cities are battling it out for the right to host a "star wars" museum. ♪

>> this is "market makers." we're talking about the greek economy isn't contracting the rate but it's hardly healthy. more than 25% of the labor force is unemployed. and the country's credit rating as you probably know is still deep into junk territory. yet some of the world's smartest investors have made a killing on grease and they continue to pile in. why? thisis with us from london

morning. great to see you. love to talk about grease because everybody has -- greece because everybody has forgotten about this country. why do investors still see so much promise? >> hi, eric and stephanie. well, it's interesting because 24 months ago, i'm sure you recall there was a debt crisis in the eurozone and in the periphery in particular. and people were obviously, stressed ann growth, fiscal crisis, etc. and hedge funds in particular and i would say particularly in the u.s. were very worried, very concerned. the eurozone banks were highly undercapitalized. >> and they were. let's be honest, a year ago, banks were highly undercapitalized. >> and that's being addressed to an extent.

not to the extent that some people wanted and expected, but through equity raises, as well as liability management involving subordinated debt, etc., and new issuance of debt instruments, they've obviously increased their capital levels. and in the case of greece during 2013 and early 2014, no less than 34 billion euros has gone into the greek banks. now there's been an incredible consolidation. they used to be 35 bank licenses in greece. there are now five. and really there, are four large banks left, which are a result of forced mergers, engineered by the greek central bank. and of that 36 billion that's been raised through to april of 2014, not in the past 18 months, 11 billion has been raised from the private sector. the balance was essentially a rescue fund that was put

together. so what we've seen since last summer is a very abrupt u-turn, partly on valuation grounds and we'll address the greek economy in a minute, which has resulted in an estimated $10 million -- i'm sbitch from injure roes to dollars now. and that represents one of the largest bets that the hedge funds have played. >> what's hard for people to understand is why did the trade turn around so rapidly? is it because -- is it the same situation as we've seen with lehman brothers? hedge fund spotted an opportunity because everybody thought there's nothing left and as it turns out, there is lots left for creditors. is it the same attitude that hedge funds are bringing to greek have brought and continue to bring? there's still tons of money to be made and it's just the chumps who aren't willing to do the work or take a look don't see it? >> well, i think there are some

similarities in the sense that obviously, hedge funds believe they've identified a case of deep value and i believe and i've spoken to a number of them, they think they can tribal the money on a two or three-year view and maybe aud drama their money. banks are levered. but the big difference with lehman is they're a close structure. you're buying something at a zount face. and you have the upside that was appropriate to a liquidation whereas here, the returns that you might make will be driven by economic performance of greece. >> all right. >> there are so much that the banks can do. >> here's a heartbreak. let's say the download, the g.s.o.'s of the world are cashing in big time. what does the economy look like in greece? for those who are truly suffering just two years ago. how has it changed for them? >> well, in q-1, the g.d.p.

contracted just over 1% year-on-year. so clearly, we've moved on from the deep recession of 2010 to 2012. so things are better. there is confidence in capital markets digs to these investments in the banks. hedge funds have invested in some property companies, hotel businesses etc. there is some level of foreign investment going into the country. but in terms of the vast majority of the population, they're not seeing the benefit. now, this year is expected to be a big year for tourism. so people to an extent are banking on that recovery. but i think it's fair to say that it's very much a case of hoping for a strong economic recovery. and i don't think there is any tangible evidence of that's happening today. i mean, we're talking about banks that will be making to at least 2016, possibly 2017. obviously, on a preprovision

places, they're profitable. >> theo, it's a move we've seen so many times in the past few years. financial investors making out great while the man on the street continues to sufficient. thank you for bringing this to us. >> when we come back, it will be a museum like no other. i'm not sure how many class trips will be headed there but families sure will, which is why people in the two cities are hope the force will be with them. i'm talking "star wars." stay right here. you are watching "market makers" on bloomberg television. ♪

>> welcome back to "market makers." it's not jedis and storm troopers beating it out for "star wars" creator, george lucas's latest saga, it's cities. the former lucas film c.e.o. and owner is now working on his namesake museum. san francisco, home to skywalker ranch should be the top contender. the windy city is blowing in with a challenge of its own. we traveled to chicago to size up the unlikely competitor. >> chicago, known for wrigley field, the bears, and deep dish pizza now wants to be home to chewbacca, r2-d2 and everything else that comes with the george lucas museum. >> it's a win-win for the city of chicago.

>> the mayor set a target of $55 million chicago visitors in 2020 with $48.4 million last year, lucas's museum could help close the gap. >> of all the things that i've seen in my years in this job, this is one of those game changers. >> the proposed lucas cultural arts museum would be a $300 million showcase for lucas's personal collection of art and memorabilia featuring names like rockwell, parish and vader. a vision is in place even if the location isn't quite yet. a task force recommended 17 acres of lakefront property currently home to the bears' soldier field parking lot. chicago would lease this land for $1 arc bargain for george lucas but city officials hope that the force of the museum will attract visitors and revenue. the "star wars" empire has already earned $27 billion and with another movie in production

and two more planned, there's no apparent end to the interest in the franchise or the man who started it. ? san francisco where "star wars" was born, federal officials rejected george lucas's original proposal to build his museum in a national park overlooking the golden gate bridge. still, local leaders are hoping home team advantage could win. >> it's a national tie, the digital media and the amenitys and it's lucas's home. >> but ever since it's marriage to aerial investment president melanie hopson, lucas has called chicago his second home and chicago has its advantages. >> for all the people that this museum is going to drive, getting to chicago is easier than getting one coast to the other. >> to quote a small but powerful jedi, lucas is expected to select a location this summer. >> well, there you have it.

chicago, it's not like we're talking about san francisco and toledo. melanie hobson, george lucas's wife is one of the most powerful influential people in chi-town. so, it's not out of the question. >> stands to reason that chicago would be in the running. >> i'm going to guess wherever it is, my family will be taking the journey. >> i know of one city that woke up pretty happy this morning, feeling maybe pretty damn good. new york city. the rangers beat the montreal canadiens 1-0 last night. the stanley cup finals for the first time in 20 years. yes. i was there at madison square go en watching the afters down -- avenues go down. >> just one period. scar is looking tide the finals and how much it will cost to see her beloved rangers face off against the l.a. kings or the chicago blackhawks. >> we don't know who it's going to be. >> did you come on live tv just to say that, eric?

in your face! >> there you go. >> canada! the whole thing. >> team u.s.a. team canada. >> i do have a chart. i did cook one up here. >> hold on. do you have more canadian prize for a team of montreal or a new york team? >> this one is from scarsdale, new york. and i came here to say in your face, eric. >> but nevertheless -- >> we can be civil or pilot. unlike the subhuman amounts of fans i saw in m.s.g. last night. >> you should know better. >> we're talking hockey fans, brother. >> we're talking new york city hockey fans. >> i actually think philadelphia fans are the nastiest. >> a lot of people have said that before. >> let's get to the numbers. >> new york is going to host three games in the stanley cup finals, three four and six. and the only one where there might be a cup awarded is game four or game six. so if you look at which game --

>> i'm counting on somebody winning at least another game. >> we'll get an actual cup, you're looking at game six in new york. and the average price for a ticket is $3,176. >> yeah. that's right. >> does it say where that seat is? >> no, that's the average price. that's everything. the highest price -- >> i don't think there's going to be that many subhumans paying that price. >> that's amazing what a hockey game to do to a new yorker. >> there's limited seat. and new york end up facing off against the kings. >> bicoastal series. >> huge. huge markets in and of themselves. and the other sports teams in both of those cities are not doing anything that great. >> are you going to step it up? >> i'm happy staying at home watching it. >> are you going to sub it up? stay to the end of the game? >> she's going -- we want her to stay awake, eric. >> scarlet fu, congratulations. >> in your face!

>> once again, yes. >> we'll be right back in two minutes. ♪

>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. >> the former microsoft ceo will be the new owner of the l.a. clippers. he is spending a record $2 billion for the team. courtside seats just got a lot more expensive. typical employee is white and male. we will see the transparency about its workforce will bring more diversity to silicon valley. >> it is super mario in a mercedes. game is's classic video

going upscale. the company needs all the help it can get. welcome to "market makers." we're going from star wars to super mario with a little basketball. the sounds like a friday. we had to get to the top business stories from around the world. a surprise drop in consumer spending last month, household purchases dropped 1/10 of one percent in april. goes -- pimco is tipping their hat to the previous and current fed chairman. they say ben bernanke and janet yellen have rescued the u.s. he is now the firm's economist. is runningberg around his fortune. the facebook ceo and his wife million tog $120

public schools in the san francisco bay area. the money will be used to support innovation and give students more choice. stevemer microsoft ceo ulmer known for his hyper emotional presentations has a whole new court primed for his antics. i cannot wait to see the pregame and halftime shows, because the biddingr won war for the l.a. clippers. his bid to set a record price for the nba team, and joining us to talk about this fascinating situation is the economist from onth college, and the author the phone with us. andrew, $2 billion, we are stunned. are you. ? >> yes. this is a vanity purchase. it is a toy, it is akin to what

the gentleman worth $3 million did when he bought manchester city. thinking and be hoping is that the clippers will get a deal like the dodgers and the lakers got from time warner, but time warner is taking a erious downgrade on those deals, losing a lot of money. there is no way that time warner would up the pay for the clippers to that level. you may see new television contracts owned by the clippers, but the dodgers are getting $340 million a year. without that kind of television money, given the fact that this arena,nd somebody else's they do not have their own arena which means that they will generate less arena revenue, it is a team that might be worth

900 million or $1 billion, but not $2 billion. >> why is guggenheim in bidding? ones who understand how much the company is worth. >> there's one argument when you get your money when you get out. the franchise values keep going up. i think that starts to get stretch when you get to these kinds of numbers. you could look at it like a piece of art. it does not generate anything while you have it, when you sell it you get a return, and while you have it you get a bit of pleasure. there not going to get 14,009 hundred percent that the two rulings will get out of this . >> when magic johnson bought the dodgers, we were laughing, saying that these fools were , what morons.

we're not saying that now. >> the dodgers had in their back rocket 25 year television offer from time warner that is worth money to the dodgers. are indeed worth $2 billion. that deal is losing time warner a lot of money. the other television cable distributors were not taken up -- will not pick it up. there is no way that either time theer or others will do dodger deal or the laker deal. they will not get that amount of money, and therefore it is silly to compare the franchise values. keep in mind as well that the dodger bread and the laker brown -- dodger brand and the laker brand is much stronger than the

clippers. >> if there is no economic basis for a $2 billion valuation on the clippers, does that mean deal does not change the games as much in franchise values and professionals ports -- sports? we woke up this morning and thought they were worth more, maybe not. >> steve alder is a basketball fan, is one of the pre-poll on earth with billions of dollars, doing this with no partners. else outis someone there that wealthy that was the team and wants to put it on the balance sheet, it limits the automatic that you could attribute to be other franchises in the nba. aeve ballmer is saying i have shared a strong business, and i am not going to take it back on this. >> look what microsoft did when he with the ceo.

he still felt like the man on top, but nobody else thought that. andrew? figure outry hard to what steve ballmer is thinking. it is very clear this is a vanity purchase, not a business purchase. after all he was sent a package by the sterling's two days ago of financial information. this is about 17 pages long, it is unheard of that nobody was making a serious is this investment for hundreds of millions of dollars would not do further due diligence. if you look at the typical financial statement and you know something about the sport, you have a lot of questions you want to follow-up with. the very fact that he has made this offer on the basis of two days of information and no interaction, and no time to go out and explore new television contracts suggests that this guy about owning a basketball team.

>> maybe he is not crazy though. incrediblyin a permissive time, he can go get a low-interest line, and it is almost like he is buying it for free. >> he is an adrenaline addict. he can afford not to care. he is in a situation where this is sort of a rush situation. he has lost out before trying to get a team. he has hoped this would push through some of the interference. maybe donald sterling look at that tag and said i'm not going to fight. i know does not make sense if you're trying to look at return and investment in the near immediate medium term, but it makes sense for me. >> he is now putting the ball in

ballmer. why not do this? what does $2 billion due to changes life? nothing.e >> will they go to seattle? >> no. >> why would he want to move? and situst be mr. cool courtside, what better time to do it, if he cannot do it in new york? of course you want to stay in l.a.. you think jack nicholson is going to make his way to seattle to see a game? no. it is about setting courtside in l.a.. >> i think that is what he told wall street journal. he is now free of seattle because he does not work for microsoft. he can go to atlanta court i like you said. >> thank you.

>> does that not make you want to go to a clippers game and watch steve ballmer at his best? >> if we see him, i'm definitely going. >> when we come back, silicon valley forced to look at diversity in the workforce. ofplus, you have heard madmen, meet the mad hamsters. ♪

it is time for some of the

bloomberg west top tech and media headlines. musk and a reusable capsule that should be able to take the astronauts to the space station within two years. taking steps to make sure you have the right to be forgotten online. for europeans who want their they mayon deleted, ask google to remove after this ruling. theppeals court upheld right to sue apple is a group. that trial is set to begin in july. back the is drawing curtains on employee diversity figures, and it is not pretty. women make up 30% of its work or

smile the dean dozen african-americans make up to five percent. but our next guest said those figures are good news. he joins us now. google releases kind of information? >> they have been getting so pressure to release this data. silicon valley has a big spotlight on it right now because of sexism and arrogance . they want to lead the pack and say that the numbers are not very good and we're going to do something about it. >> surely you jest. silicon valley, arrogant? a tinge of racism when it comes to african-americans. >> when we look at the numbers, are there and enormous amount of

women and minority candidates for these silicon valley companies that are being turned away? i am guessing that the human resources departments have huge initiative to hire them. workforce is 70% women. women. take it picke to from the available pool. everybody wants to join google. you could have 50% women to really put your heart to it. starteve they're going to announcing these types of things. >> i am just guessing that what is -- would really choose >> i'm sorry we have to

interrupt you, the president is making some remarks. >> we have just finished our review of the ba facilities nationwide. the misconduct has not been limited to a few veterans and ministrations of the sultans but many across the country's. -- veterans and administration facilities, but many across the country. hinsekiry shall set has begun the process of firing those responsible. bonuses, and we have ordered the care they deserve. a remark ofick take

action and public remarks. he took responsible for the conduct of those the saudis and apologized to his fellow veterans and to the american people. a few minutes ago he offered me his resignation. it is those considerable regret that i accepted. he has served his country with honor for nearly 50 years. he did two tours of combat in vietnam. he has left a part of himself on the battlefield. he commanded the first cavalry division, served as army chief of staff, and has never been afraid to speak truth to power. hassecretary of the v.a., presided over record investments in our american veterans. making it easier for veterans with automatic stress, mental

health issues the management rain injury to get treatment ourt improving care for women veterans. at the same time he helped to reduce that in homelessness and help more than one million veterans i'm a service members, and their families pursue their education under the post-9/11 g.i. bill. veteransmitment to our is unquestioned. his service to our country is exemplary. i am grateful for his service, as are many veterans across the country. he has worked hard to investigate and identify the problems with access to care, and he told me this morning that eva needs new leadership to address it. to be anot want distraction because his priority is to fix the problem and make sure that our veterans are getting the care that they need. judgment onk's

behalf of his fellow veterans, and i agree. we do not have time for distractions, we need to fix the problem. now, the leader that will is sloan us forward gibson who will take on the reins of acting secretary. sloan became deputy secretary just three months ago, but he has devoted his life to serving our country and our veterans. his grandfather bought on the front lines of world war i, his father was a tailgunner in world war ii, and he graduated from west point and earned his airborne and ranger qualifications and served in the infantry. presidenttly he was and ceo of the uso which does a remarkable job supporting our men and women at war, their families, our wounded warriors, and families of the fallen. of told, he has 20 years experience he brings to bear on our ongoing work to build a 21st century v.a.

i am glad he wants to take on this task. i made it clear that reforms should not wait, they need to proceed immediately. i have also asked rob neighbors tuesday temporarily to help the department through this transition, and to complete his own review. in the meantime we will look diligently for a new come a permanent v.a. secretary, and we hope to fill that post as soon as possible. we will do right for our veterans across the board. as long as it takes. --will not stop to stop working to make sure they get the benefits they deserve. we have to do better, and we will. receivingeterans care, deserve our best efforts.

our week i visited some of men and women in uniform in different stages of their service. our newest army officers who graduated from west point, our troops currently serving in afghanistan, our veterans and our military families at arlington. what i have seen every single service member, veteran, and military spouse that i have had the privilege to meet. clear eyed commitment to serving our country, the best way they know how. they are the best that our country has to offer, they have to do their duty. they expect us to do hours. -- ours. i want every man and woman who served under our flag to know -- to know that we will never stop working to do right by you and your families. let me take a couple of questions. leo shane from the military times.

whatlitary president, changed in the last few days? he was confident coming in and would resign. >> is judgment. would be athat he distraction from the task at hand. that what make sure is broken get specs so that his fellow veterans are getting the services that they need. reiterate, he is a very good man. i do not mean he is a published man, yet do not mean that he has been and is leading soldier -- he is a good person. he has done excellent where he worked -- exemplary work on our behalf. under his leadership, we have seen more progress on more

.a. and a bigger investment in the v.a. than just about any other v.a. secretary. he brought in folks who have been exposed to agent orange who had been waiting for decades to get the services and benefits that they had earned. post dramaticat brain injury was dealt with in a serious way. making sure we had facilities for our women veterans who were not receiving the kind of specialized services that they needed. champion of our veterans, and where there are problems he has them ready and willing to get in there and fix them. thatthe disability backlog had shot up as a consequence of the admission of the agent

orange veterans as well as making it easier to apply for posttraumatic stress disorder disability claims, when its fight he went at it in a systematic way and we have cut last year orr the so. he is not adverse to admitting where there is a problem, and going after it. environmenty a not that not just calls for management fixes, we also have , and in >>h congress rick's judgment he cannot carry out the next stages without being a distraction. my assessment was that unfortunately he was right. i regret that he has to resign

under these circumstances, but i have confidence in sloan and i assessment that the number one priority is to get problems fixed so there is a veteran out there that needs help can get a schedule and come in and see a doctor. if there are facilities that do not have enough. as, nurses, or that that information immediately gives in the day -- it's in the hands of the decision-makers so we can help folks. that is the biggest problem, the thing that offended him the most during this process. he described to me the fact that when he was in theater, he might have to order and tact is based on a phone call based on 20-year-old corporal, and

yesterday dressed he is getting good information that is life or death. i think he is deeply disappointed in the fact that bad news did not get to him. in placetures were not for him to identify this problem quickly, and exit. -- fix it. he feels new leadership would be serving our veterans bet, and i agree with him. phil mattingly? based on these early-stage audits that the secretary presented to you, is there criminal wrongdoing? how much responsibility do you personally bear as this is an issue you campaigned on, now that we are at this point? the will leave it up to justice department to make determinations and there has been criminal wrongdoing. in terms of responsibility, as i

have said before, this is my administration. i always take responsibility for whatever happens. this is an area that i have a particular concern with. this predates my residency -- presidency, when i was on the affairs committee. i heard firsthand about veterans who were not getting the kinds of services and benefits that they had earned. i pledged that if i had the privilege of serving as commander in chief, we would fix it. organization big that has had problems for a very long time. in some cases management problems and in some cases funding problems and what we have tried to do is that the man likely go after the problems that we were aware of and fix them. ourwhere we have seen veterans not being properly served, weather was too many homeless veterans, or a disability claims process that was taking too long, we would go at it and chip away at it and

fix it. funding, we have increased funding for v.a. services in an unprecedented fashion. we understood that it is not just enough to give lip service beour veterans, but not willing to put our money where our mouth is. can say confidently is that this has been a priority, it has been a priority reflected in my budget, and that in terms of managing the v.a., where we have seen a problem, where we have been aware of a problem, we have gone after it and fixed it and have been able to make significant progress. --t is absolutely created issue ofthis scheduling is one that the reporting systems inside of the dha did not surface to the level ware of it. was a

this was not something we were seeing. i do not hear but when i was traveling around the country. see we are going to do is how do we get information about systems that are not working? i was just talking to rob nabors and he was describing in detail how we have commuter systems dating back to the 1990's, situations in which one scheduler might have to look at four or five different screens to figure out where there is a slot and where there might be a doctor available, situations in which they are manually passing requests for an appointment over to somebody else. you have in many cases old systems, broken down systems. eminentlyuff that is

fixable, but we've got to know about it. the bigger concern i have got and what i will be interested in that inout is how is it a number of these facilities, if in fact you have veterans who are waiting too long for an that information didn't service sooner so that we can go ahead and fix it. one last point i want to make on this -- when veterans have gotten access to the system, the health care itself they are receiving has gotten high marks from service organizations and the veterans themselves. it is important to keep in mind that what the review indicates so far at least is that there have been great strides made in the actual care provided to veterans. the challenge is getting veterans into the door,

particularly for their first appointment in some cases, and where they don't have an established relationship with the doctor and they are not in the system. part of that is going to be technology, part of that is management. shinseki himself indicated, there is a need for a change in culture within the vha and perhaps the va as a whole that makes a short that bad news -- that makes sure that bad news gets serviced quickly so that things can be fixed. i was the attitude of secretary shinseki and that is what he him,nicated to folks under but they didn't execute, and that is a problem. christy parsons, last question. >> you said it was the general's own judgment. if i remember correctly, secretary sebelius offered her resignation after healthcare.gov

failed and you declined to take it. i wonder if there is a little bit of scapegoating taking place here. >> meaning? >> the dysfunction in the department could have been very deep and widespread. head reallyff the the best step to take going forward? what i'm asking is is there a political reason for removing him other than going straight to the problem in the bureaucracy. >> the distractions that ric refers to in part our political -- are lyrical. i want somebody at the va who is not spinning time outside of not spendingems -- time outside of solving problems for the veterans. i want somebody who is spending every minute of every day figuring out how we called every single veteran that is waiting? are we fixing the system? what kind of new technology do we need? have we made a realistic

assessment of how long the wait times are right now and how we are going to bring those wait times down in certain facilities when the wait times are too long? if we need more money, how much more money do we need to ask , and how my going to make sure that congress delivers on that additional funding? that is what i want somebody at the va focus on, not how are second-guessed and the speculation about their futures and so forth and so on. that is what ri agreed -- that is what ric agreed to as well. with respect to secretary sebelius, at the time i thought it would be distraction to the place somebody at hhs -- to replace somebody at hhs when we were trying to fix the system. down on it and got

folks enrolled, it would work. in each instance, my primary decision is based on how can i deliver service to the american people and in this case, how can i deliver for our veterans. because they are people of integrity -- i think in both the cases of secretary sebelius but certainly in the case of ric shinseki, they've got the same irony. the -- same priority. is how to best deliver on behalf of the folks who have been let down. >> she had so much knowledge about what had gone wrong that you cannot afford to lose that. ins somebody with 3 months the bishop of the department have the capacity to attack the problem quickly now -- in the leadership at the department have the capacity to attack the problem quickly now? >> there is technology that he will have to learn and deal with. but the nature of the problem that has surfaced and has been

the cause of this attention is one that we can start tackling withoutay, and completely transforming the system we can immediately make some progress. my first step is everybody who is out there waiting, get them an appointment. if we need more doctors, let's figure out how to get some doctors in there to make sure they are getting the help that they need. what we want to make sure of then is that even if it is still , how do we make sure there is no slippage between some many making a phone call and then getting an appointment scheduled. and let's have a realistic time when they can get an appointment. those are things that don't require rocket science.

it requires execution and focus and those are things that sloan has full but there are broader issues we will have to tackle. the information systems inside the vha, that will have to be changed" money and take some to be changed and that will cost money and take some temple to the have to be changes with the culture within the vha. they are providing very good service, medical treatment, to our veterans when they get in the system. but they don't have, apparently, operationsf-the-art that you would want to see in a major medical center or hospital. who in mind, those of us are outside the v.a. system and try to get an appointment where the doctor in the private sector and try to get an appointment visit, there are probably some way times as well.

we have to figure out what are realistic benchmarks for the notem and my suspicion is only with the veterans from iraq and afghanistan coming back, but also the aging of our vietnam vets, who may more have -- have more chronic illnesses and need more visits, we may need to get more doctors and nurses, and that is going to cost some money , which means that will have to be reflected in a veterans affairs budget, which i have consistently increased even during fiscally tight times. there has been no area where i've put more priority than making sure we're delivering the kind of budget that is necessary to make sure our veterans are being served. but may still not be enough. forwards -- before we start spending more money, let's take

care of basic management issues that i think can be fixed. thank you. of the unitednt states announcing that veterans affairs secretary eric shinseki has resigned, falling on his sword over the disgraceful scandal at veterans affairs hospitals. the president said that in general shinseki tendered his resignation as money, describing him as a good man, but this -- tendered his resignation this morning, describing him as a good man, but this clearly doesn't make this chemical away. you saw phil mattingly asked if he took responsibility and he said that as commander-in-chief, he does. peter cook is also following the president's remarks. peter, is it clear to you at all -- difficult for me to tell the way the president phrased it whether shinseki was told to resign or whether he actually tendered his resignation to relieve some of the political pressure on the president and the democratic party and the administration as they head

towards the midterms. veryll, this was a difficult situation for the president and obviously for eric shinseki as well, but the hints from the white house have been crystal clear all week long. when we heard jay carney yesterday at the white house briefing failed to step forward and say the president still had confidence in shinseki, that is when the writing was on the wall. this is a political requirement basically at this point, given the scandal that has unfolded and the way republicans and even some democrats had to join in the calls for shinseki to go, ause he wasn't an admirable servant, a four-star general, but that he was a distraction at this point and this would continue to be an distraction for an administration on other fronts with regard to climate and form policy. -- foreign policy. it is pretty clear that the hints from the white house required or dictated what took place in the oval office earlier today. >> peter, you read this report,

we haven't yet. what did you think? >> this report is scathing. it is very troubling. the president talks about the care that the veterans receive at these hospitals is pretty good but you have to get into the system, and what this show, the phoenix vi in particular, 1700 people on an unofficial only -- the, not allegations are that the people running that system were worried about their bonuses because they were tied to performance because they were tied to people getting into the system, smaller waiting lists and reduced wedding lists were a consideration and how they got paid -- reduce waiting lists were a consideration in how they got paid. this is a problem not just in the phoenix v.a. but across systems, systemic problems. there will be other heads to go, and the justice department is looking into this. quite likely we are going to see the real prospect for criminal who pution in of anyone

people on these waiting lists on purpose. >> is this going to relief political pressure on the president and the democratic party? there are a number of democratic senators up for election -- mark warner, udall from colorado also calling for shinseki's reservation. -- resignation. speaker of the house boehner pointed out yesterday that having a shinseki walkaway does not get to the bottom of the problem. >> but from a political standpoint this is the outcome that a lot of those democrats running for reelection wanted. this is more a bipartisan issue of getting to the source of the problem and maybe the question for funding of the v.a. going forward. it is noticeable that almost all the democrats in the senate who stepped forward were democrats running for reelection. it is less of an issue now even though it is not entirely removed from the equation. .> peter cook, stay with us i want to bring in washington correspondent phil mattingly over the phone. moments ago he had an opportunity to ask president

obama question. this seems like more bad news for the president. on a bigger scale, what does this mean? atwell, steph, when you look the v.a., something that the president campaigned on fixing and correcting many of the systemic problems that were clearly apparent during the bush admin attrition, legacy-wise this is a problem for them. the president and his team devoted a lot of money and at least talking point to the veterans affairs administration and this clearly shows that it didn't work. it is still flawed on a number of different levels and both politically and policy-wise, as is where they came up short in a major way during an otherwise pretty difficult year for them. , does that add fuel to the fire or applet by the criticisms that the -- amplify the prisms that the president -- because as you pointed out, the president had claimed to care about veterans affairs, that he is -- i hesitate to say

incapable, but there are some people who say he is incapable of running his an administration doesn'the eyes of many give these issues the appropriate amount of attention and oversight. over andsue is that over again there are things, to your point, that they just weren't aware of. you heard from secretary shinseki this morning that he didn't have people he can trust. you heard the president say that when he was traveling around the country he wasn't hearing about these issues. without question that is a talking point used by republicans, that the president is not in control of his own indiscretion, that they are not aware of so many the problems. -- not in control of his own administration, that they are not aware of of these problems. the republicans the center on a cartoon of him getting everything and it is him -- getting a briefing and it is him reading the newspaper. in terms of an issue,

particularly in a political season we are in right now come up more often you hear the president of the united states say he was not aware of a major systemic issue, it is problematic for the party and the presidency. >> thank you very much, our white house correspondent phil mattingly. he was in the room asking a question of the president, describing general eric shinseki's resignation as secretary of the veterans affairs, and of course, peter cook bringing us insights on the political fallout. we will be back with more.

>> welcome back to "market makers." what could be cuter then tiny hamsters? i say a lot of things because they are rodents. how about tiny hamsters eating teeny burritos? will this translate into big

dollars? cofounderbring in the of a social campaign start up behind the video. he joins us behind los angeles that she joins us from los angeles. i actually love these -- he joins us from los angeles. i actually love these tiny hamsters but i have no idea what company they promote. >> we basically made it as part of our independent content channel. we have been working in viral advertising for the past 4 years, doing branded campaigns for all of that time and we wanted to allow ourselves some creative freedom and to sort of open ourselves up to being able to make things that we wanted to without needing to worry about brand approvals and anything like that -- >> but you are an advertising company. what i don't connect to this -- listen, i love this, i will watch these hamsters all day long, but at the end of the day,

whoever is producing this wants to get paid for it. what am i supposed to buy? what is this supposed to incentivize me, to go from acci -- to go for mexican? >> if we can get more people to eat mexican food that is a full success in our opinion. the main reason is to draw attention to ourselves as an ad agency and demonstrate what we can do with the internet as a medium, our understanding of it as a medium, our creative talents we can leverage, the exposure we can get from a relatively small budget. >> joel, i want -- >> raise awareness for mini burritos. >> you guys clearly have an objective here. you were sitting around for however long it took to come up with this idea. why, exactly? burritoshamsters and and he wanted to put them

together and this is something that you dreamed of doing, or it is just clickbait you wanted people to see so that you can tell advertising firms -- your clients, rather, that you can get 7 million-plus views on youtube? bait" is a "click pejorative word for it -- >> i use it intentionally. >> what we want to do is make things that people want to watch and will bring people -- bring their day up a little bit. everybody is sitting around doing tedious excel spreadsheets and things like that and what we can do to bring that up and bring people little bit of happiness brings us a lot of happiness ourselves. there is also just the fun of making something that people will share -- going right, joel, we are to run out of time. i have to ask you, what is next? we've got the mini burritos on the hamsters. what is next? >> we are working on episode 2

and i will keep it close to the vest on what it is -- >> a clue, nothing? >> no, no clues, but there is a lot of content coming from our channel, original and branded stuff, so stay tuned. >> thanks for joining us. we will be back with more.

>> that is it for "market makers ." a lot we covered today. >> started with a great series

of interviews from the georgia bank financial services conference -- >> ended with little hamsters. >> the president announcing the resignation of eric shinseki as head of veterans affairs. on monday, apple is kicking off its annual worldwide development conference. it is in the past use it to unveil new hardware. and we had to prematurely finished our interview because of the president and that was an important press conference. will be here talking about diversity in silicon valley. when it comes to diversity, google may not be good and apple ain't so great either. >> who is? bloomberg television is keeping you "on the markets." our own -- help me out -- diehard rangers fan scarlet fu. >> it is a friday. we dive into the world of

rodents with the chief -- the world of derivatives with the chief risk strategist. what are you seeing any options market that tells us about the direction next week? >> i was going to say it is more thehe same, but 2 weeks ago nasdaq was looking like it was breaking down and things have happened since then. dennis gartman pointed it out well on monday, saying "i was short and now i am going along because i don't know what to do." people seem to be buying the index like the s&p and nasdaq and selling calls against it and buying puts against it. essentially, the way that is reflected in the markets is that puts are getting really expensive. options market makers again throwing their hands of any air. -- throwing their hands up in the air. >> if you take a look at the

vix, lower lows and lower highs. if you look at the 10 year yields, also drifting lower, currently below 2.5%, how much of an interplay is there between the low yields we are seeing in treasuries and the asset classes including stocks and derivatives? >> that, again, is a reflection of confidence. if the yields are dropping in the 10-year, folks are saying we are ok. it is difficult, scarlet. i don't think there is a direct correlation between the 2. i was trying to put together something in my head but i don't think there is a direct correlation. we don't have any news or hard facts that would send the market sharply lower here. again, drifting higher in the indices and lower in the visx is that -- vix is the trend that is going to continue. >> how about the russell 2000, iwm, the ticker for the etf that

tracks the russell 2000? >> ok, so the iwm is a bit of a different story. it was breaking down in a bearish pattern like the nasdaq but all of a sudden it broke up through its 200-day and recently through its 50-day. we see much more bearish bets on the iwm because it is just hovering about that 50-day. breakk that index will down again, perhaps next week, and that is the options action, mostly what we are seeing at least from my end. derivatives play on the 3 billion-dollar purchase by apple. it does not involve apple. >> it is not involve apple, does not involve any of the usual suspects. what it does have to do with is and with -- is bandwidth. a lot of talk we have heard about netflix eventually having

to pay, and this increase of streaming data. a company like level 3 communications stands to benefit. they are one of the bigger players in the industry but level three in its current valuation, i think it is very attractive. for them i am looking into july, the call spread. >> gotcha. >> cheaper way to control the stock. >> i'm sorry, we have got to leave it there. we will be back "on the markets" in 30 minutes.

clip."ome to "money i am adam johnson. the interim ceo of target talks about troubles in canada and what he has learned from jcpenney. this, by the way, is a bloomberg exclusive. a dragon is unleashing in the space race. we will take you to the border of russia and china and see how 2 very different countries are living side by side. and back at pimlico, but his double be more -- his double be more