>> live from bloomberg headquarters in new york thomas this is "market makers" with erik schatzker and stephanie ruhle. >> merger mania. usnson since he will tell what is hot and what is not. we will see more those international appeals driven by tax breaks. >> cashing in on cannabis. we do.talking

in another state opens a door to legalize marijuana sales. we are looking at companies who will see profits go up in smoke. bubble?at a burst of a welcome to "market makers." news, ie we get to the are i'm glad to see them leave. i live downtown on the west side. that line wrapped around magnolia for those cup cakes. i am glad to know i am no longer the only one. now we need to get to the news feed. these of the top business stories around the world. >> germany's commerzbank is the u.s..nvestigation of the they may have to play a penalty of half a billion dollars.

struggling retailer american apparel is rejecting claims it has defaulted on a $10 million loan. the firm says american apparel by oustinghe fall their ceo last month. they want the ceo reinstated. pope francis a shaking of the vatican bank. he plans to replace the board and executives after profit dropped 97%. last year the bank was tainted by the arrest of a clerk. >> the art of the deal. it is back for the first time since 2007. the values of mergers and acquisitions topped $900 billion. the expectation is that there is more to come, possibly much more. here to talk to us is the m&a

catalyst. he is the senior manager director. he could be mistaken for a millennial. i don't think so. good morning. >> it is nice to see you. >> let's talk about the m&a business. it is hot. some people are drawing comparisons to 2007. >> i think the comparison is 2000 and one. the most interesting time in 14 of 15 years. you've also got a couple more characteristics. prices,only have share you also have much more muscular boards today than you had 15 years ago. 25 yearss today have more m&a experience. boards are willing to make hostile deals. they're willing to deal robustly. >> does that make the transaction better? >> boards are much savvier and

more astute. you have the greek chorus of the activist in the background. the greek chorus is playing a very constructive role. >> the activist is playing a constructive role? we heard that from you before. udc transactions like the one that sticks in my mind. tyson buyingnt is hill shire. aat was a deal that put blackstone interest in an awkward is edition. i keep saying this because i can hardly believe it. a $35 stock becomes a stock worth 60 plus dollars. where were the activist there? where is the sane conservative activists saying what you doing? >> you've got a lot of people looking for longer-term brand demographics.

people are looking for certain brands to sell certain demographic categories. >> let's talk about this creative dealmaking process. if we are talking about tyson or bill ackman, what motivates companies right now? >> people are a lot more muscular. they're much more confident. >> i don't know what that means. balanceave robust sheets. you have low interest rates and a lot of cash. for the last five years companies have had a lot of time to fine-tune their strategies. boards of smell a lot of time listening to chief executives discuss the strategy and their implications. >> do you get concerned when you say they are more muscular? in 2006 it seemed like they were super muscular, to confident. >> would you be happier if i use the word center --fitter?

it means you are aerobic. >> do we run a risk? >> people today are very confident. there is more checks and balances today, more than there has ever been. you have much more robust governance. the chief executive is not always sitting in the same seat. you have a senior independent directors who are providing a check and balance to the board. i would say that boards are functioning better today. , when people launch a hostile deal it is a much more informed investment. it is a more thoughtful situation. >> let's talk about what is making those investments. what are the principal catalyst for corporate m&a? is it tax arbitrage? , old-stylexample

corporate synergy? these companies are complementary and we can cut costs and grow our customer base. sitting a ton of cash around and they need to do something with it or the shareholders will get angry? >> all of the above. there is no question there are a lot of deals driven by tax. certainly in the last two years than men 11 or 12 tax-based transactions. we have seen a couple lately that have failed. i think on the other hand washington and the next presidential administration will with some type of assessment or reassessment of

corporate tax. >> a lot of people hope so. >> wouldn't it be interesting if it were bill clinton? he raise the corporate tax to raise the budget. it would be interesting to see if his other half lowered it. >> it would be ironic. in terms of national priorities, what countries are creating the best environments for risk-taking? companies to do in hong kong and singapore and new zealand and australia. people are still much more comfortable with the north american environment. north america has become toreasingly more cumbersome a d start a business. >> what do you see happening?

that,he boards recognize not anticipating a change and taking steps in an m&a deal or otherwise? do they avail themselves of the opportunities through looser regulations and taxes? >> people will still be focused on their strategy. ony'll be focused demographics. they will focus on market position. they'll deal with antitrust. they won't run a file of antitrust rules. they are going to be much more aggressive at redeploying capital. john, morgan stanley has an op-ed online in the wall street journal. it says that anchor going to get bigger. he may be referring to american banks. i think he is thinking globally.

the response that they come up with as result, do you agree? >> i think it focuses on something to make use to do. it used to be the center of the community. the bank is are people went to find trust and empathy when you're looking for a loan of or to find a mortgage. big has to berd defined in terms of capital structure and its role in society. i think they are trying to redefine the role of the bank. banks, the the u.s. get muchor five, will bigger. once there is more transparency and more broad-based disclosure in europe there'll be a wave of banking consolidation across the board era. quicklyl happen pretty in the next two or three years.

opinions ofpopulist banksial industries, ken like jpmorgan -- can banks become a trusted advisor again? >> people want to see a human face. the reason why jpmorgan is so well respected is there are good people there the deal of customers. people trust the people they are dealing with. you have to translate that and figure out how to scale that. i think that is what james gordon is talking about. about the 97,000 bank franchises in america shrinking to 10,000. that is fewer human faces. >> it is like buying gucci online. to buy your gucci shoes online but you still want

to go to the flagship store and see what they look like. >> you want the experience. >> you will go to the flagship bank of america store to meet the people who have responsibility for your financial wherewithal. i think that is what he is talking about. noiseu think it is just the young people who don't think they need banks anymore? >> we have to be careful. adding there will be a reaction to dealing with bush won a, push two, bush three. people want to deal with people at the end of the day. they want to deal with them on an efficient basis. >> i take my kids to the bank. it is awesome traditional experience. >> jonna, when we come back we will talk about --

>> stay with us. israel is pounding gaza from the air. it may be on the verge of launching a ground offensive. joins coloradoe in the sale of recreational marijuana. we are headed to seattle for opening day. you're watching "market makers." also on your tablet or smartphone and streaming live on apple tv and amazon fire. ♪

>> welcome back to "market makers." i am stephanie ruhle with my fabulous partner erik schatzker. there is a crises breaking out all over the world the summer. we are seeing a major escalation in the battle between hamas and israel. editor is here.

how tense is a situation? >> it is incredibly tense. life is going on as normal in tel aviv. when you get toward gaza which is just a short way down the coast from here and you are in range of the more revenue rockets that are being fired, things are impacted. that represents manufacturers in israel is putting up a war room. impact on thehe stock market. we have had a decline of 1.5% over the last couple of days. bomb shelters are opening up just in case. happeningl that it is although life continues as normal. thingsto the gaza strip,

are very much reliving the escalation which is the biggest we have seen since 2012. i would be curious, in the event of what is happening in respect to serious if jordan is further destabilized and it becomes the oft area beyond the refugees military intervention, how do you see the deked position of do youand jordan, how see the israeli government responding to that? >> israel wants stability and jordan has been an island of stability in the arab world. there is so much turmoil in egypt and syria and lebanon and

over in iraq as well. is atability of jordan concern. that what isard it going on in iraq might spill over there. the situation is people are focused on the escalation and what might happen. has reportedly gone with egypt and tried to focus on a cease-fire between israel and hamas. certainly, it is just another headache for policymakers in this region and in the west. i suppose there are concerns that things could spill over into jordan. we have not seen that yet. reassuring how unstable things are in serious and in iraq. one hopes there is another headache to deal with if jordan

does become the stabilized by what is going on. >> thank you for an update. serious, talking israel, different parts of the middle east, how much are these affecting your business every day? last five spent the years talking about domestic politics as it relates to stabilizing the u.s. economy. now everybody has this uneasy time flipping to geopolitics. i think what you see is a number of very successful american companies that really wouldn't see the business model rise above geopolitical tensions. when you look at a coca-cola or they have a, business model that wants to

rise above any sort of short-term lyrical or geopolitical aberration. >> how do you do that? business goes on as usual in tel aviv. the israelis have seen countless -- come and go and live with it. how does that become part of the mindset of the corporate ceo? >> the successful ceo manages this global balance very successfully. the brand is very much a local brand and a local business country by country around the world. it might be a global strategy or it might be a global r&d , that brand is managed as a local brand. are pepsi in russia or

coca-cola in a number of parts you are not seen as an american brand but is a local brand. >> how do they evaluate that risk? when the political climate is so toertain, do companies start say it doesn't make sense to be there right now just because of the political uncertainty. how can you be a local brand when everything is up in the air? >> it's hard to generalize. people need food and beverage. people need consumer products. if you are a defense manufacturer, you're going to make a lot of money with what the prime minister is trying to india.ish in japan or if you're in the u.s. aerospace and defense space, you are looking forward to a much more robust business over the next five years.

recognition of geopolitical risk going back to what we start the conversation with? driving more mergers and acquisitions? >> and is a funny combination of things happening at once. you have the geopolitical risk but $2 trillion in cash office the -- offshore. >> that is a great point. >> thank you for staying with us. up.e've got more coming do yourant to hang 10 time off or do you want something a little less strenuous? we have a list of the world's top vacation spots. it are watching bloomberg tv. ♪

>> coming up, the home of

microsoft and starbucks got a brand-new industry as of today. recreational marijuana goes on sale legally in the state of washington. >> that is connected to this next story. crumbs is going out of business.

>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> i am stephanie ruhle. hotoday in washington state becomes legal. -- pot becomes legal. regulated heavily with only 7% of retail licenses approved by the state. jon erlichman is outside one of the approved pot stores in seattle. in the the only store washington largest city. is conveniently located

across the street from a denny's. we have watched the pot industry develop in colorado. it willxpectation that be similar in washington? >> i think there is that expectation. context, both in of these states gave the thumbs-up about 20 months ago. case ofken in the washington a lot longer to get up to speed in part because they have a lot of work to do. at, itore where we are is not like there is the most luxurious retail location. we are basically in an industrial part of town. there are strict limitations on how much potsay, is mentioned outside the store.

additionally, there is the factor that you have to make and hott pot stores growers and the distribution is taken care of from a regulatory standpoint. i think there is the expectation that they will push forward the way they have in colorado. >> it sound like it is costing them a lot of money to be repaired for this. what do the economic impact be on the state? i think it is going to be interesting to watch. you were talking about a store owner who says the investment was $50,000. a lot of that is going into buying the pot. we will see how the demand plays out. high rated at a raises questions about how many people will choose to come legally to stores as opposed to ifng to the black market or

you're approved for medicinal marijuana by it that way. to your point stephanie, colorado had high hopes for tax revenue. they are not generating as much as they thought. in washington they had to bring down their estimates as well. it is a new business. that is the key. that is why there is a lot of curiosity. >> why is there a security guard behind you? he is not as tough as the other guy. >> does this say something about the kind of business they expect? >> people who have been supporters of this argue that this industry has been unsafe. you don't really know what you are buying. now there is regulation with respect to that. you're supposed to be able to go into a regulated store and buy

this safely. having a security guard out front hammers at home. i think now they want to maintain some crowd control. they will open the doors around noon local time. >> i can't see past that. is there a huge apple store type line? >> i was joking with betty liu about that earlier. this is not like opening an apple store so far. maybe people don't know that this exists. this is something the media is covering closely. we are in industrial part of town. there is not of signage. people's this will get attention. that theylso the fact are concerned about how much supply they will actually have. restrictions some on how much you can actually buy. >> may be don't wake up that

early. thank you so much. jon erlichman is standing outside one of the first stores. i want to talk with one man who wants to cash in on this pot boom. he invests specifically in the canvas companies. he is also in seattle this morning. brandon, what does this mean for you? we are excited about this experiment in democracy. this is unfolding before us today in washington state. >> give us specifics. over a year-and-a-half ago the residents of washington state voted. now we have 21 stores that had been approved and will be over 300 eventually. it is another migration from a black architect of illegal

market. just like alcohol to lace 75 years ago. branding?is have the you were saying it was difficult to find a bank to deal with. there was still a black cloud around. people did not want to be in the pot business. now that it is legal, how much does that help? >> it helps a great deal. we have two operational retail states. this week we saw governor cuomo in new york legalize medical cannabis there. legalizea we will see in november. we will also likely see oregon and alaska legalize recreational cannabis. it is a slow migration towards the end of prohibition. out, therean points are number of states in america

that allow for legal medical marijuana. you have two states were recreational marijuana is allowed. does it make sense of the financial services industry is so reluctant to bank the marijuana business? be?hy should it this is probably going to get clustered in one of those sin industries. >> but we have bank tobacco. >> let's be clear. it took some time to develop those track records. i think it is interesting to listen to brendan's discussion. i think we need to see where this demand levels out. where it is coming from demographically over the next six to 12 months in the state of washington. i'm sure he has his own models and views about how this will evolve.

it'd be interesting to hear him comment about that. the banking sector banks things that have a certainty of cash flow. there any questions in your mind about the certainty of cash flow from the businesses that you are investing in or the ones that are active? >> that is interesting. currently we are in a situation where 58% of americans think cannabis should be legal. it should be taxed and regulated like alcohol and tobacco. it is far less harmful to individuals then alcohol and tobacco. you even mentioned the sugar. it is a safer product. people the been using for 5000 years and we will see a situation in colorado and washington where it will no longer have expenses to incarcerate and prosecute people. it is a slow shift.

after november a number -- majority of americans will live in a state where cannabis is legal. that is a great shift. there are still risks. there are some shenanigans. hopefully we will overcome those in the coming months. this businesssee evolving from the standpoint of the cash flow characteristics? i am assuming that as an investor you see this long-term as being stable and established and very bankable and refinance a bull. >> that is exactly right. over the short term it will remain a profitable business due to a lack of supply as move from under regulated market to a regulated one.

ultimately, it will be similar to any other american industry in that brand is where the value is. that is what we look for. we look for mainstream brands that match of mainstream industry. >> what is fundraising like for you right now? months to raise our first 7 million. wille end of this month we raise an additional round of not less than $50 million. it has gotten much easier. >> what you have to have an way of assets to be a viable money-management business? for a fund, we are looking to raise a fund that is

approximately $250 million to $500 million. >> thank you so much for joining us. back, five-star vacations will tell you where to go for the best of everything. you're watching "market makers" right year-end bloomberg television ♪

>> if you're looking for the best city in the world, go to japan. a the ancient city of kyoto is number one. the magazine asked to rate cities and airlines and the results are in the new issue hitting stands july 18. we have a sneak peak right now. did kyoto surprise you? >> it is the first time ever. not really. american travelers

today are looking for something distinct. and memorable. places morew distinct and memorable than kyoto. it is anns, interesting place because it is very traditionally japanese and modern at the same time. it has great restaurants and a fun scene. if you want to immerse yourself in the beauty of this asian country, and experience something very different from anywhere else, kyoto is the place to go. >> i totally agree. kyoto is one of is beautiful cities in the world. it is real japan. it is one of the ancient capitals of the world. there are no tall buildings. during world war ii, the japanese took all of the shrines

and they numbered all the pieces and wrapped it up. it was buried 30 feet underground. the city has never been damaged during world war ii. there are things like the golden house with wonderful the floor. as you walk on the floor it twitters like birds. the shogun's palace. it is unbelievable. mostpanese is the meticulous people on earth. kyoto is where they really exhibit that. >> what does it tell you that ?eaders would choose kyoto it's not visually stunning like rio or cape town. it is not something trendy like

oslo. what does it say about travelers? i think they are looking for an experience of the world. they can immerse themselves. >> is that how they felt five years ago? >> five years ago it was the age of sydney. sydney was the world's best city for a number of years. then it moved to bangkok. they got a little but more interested in the exotic. now they have settled on kyoto. is number two choice charleston in the united states. >> they love food and beautiful women. >> the food, the people, the

experience. it has the top four small hotels in the united states. i think it is about authenticity. go to a place that feels different from where you have been. there is something joyous about charleston. >> now that we don't use travel agents for the most part, are your recommendations more important? >> why would i use a travel agent? >> there you go. >> you are adept at doing things on your own. can deliver a lot of perks that you might not be able to get. they can get you a room in a hotel that is booked. they can create an itinerary for you. it is seamless.

they can intercede if you're having a problem. we still believe in travel agents. have a problem i at a hotel i will tweet at the hotel. top super list of the agents. we checked them out. we check them out very carefully. we checked out their relationships with their customers. i believe in travel agents. >> they had better be good. >> i think it is a terrible word. travel advisor. there is an element the one summit is going to think through the entire experience. start off with what you want to accomplish. the advisor thinks through the different places and hotels and

the people who can make sure that you do things that are off piece. the rise of travel specialists who are specialists on certain destinations. they really earn what they make. they know their stuff. now travel advisors need to be very confident digitally and need to be aware of social media and all of things that we consumers. >> thank you so much for joining us. "travel andditor of leisure. for one.a topic >> designer cupcakes. ♪

>> someone was listening.

it become take a battle is humbling. crumbs bakery shut down for good. they were delisted by the nasdaq. julie hyman has been looking into the cupcake industry. what went wrong for crumbs? people realized four inches of frosting was awful? >> people have been talking about the cupcake bubble for a long time. he is the founder of crumbs bake shop. he was asked if there was a bubble and this is what he said. >> we think cupcakes are part of it is other culture. there are no different than cookies or brownies. we believe in our product and we will continue to open up stores throughout the country. >> everybody else did the same thing. we did see a lot of cupcake chains open up.

there was a lot of competition. know the locations in manhattan were relatively large locations. they were expensive locations. that was an issue. the sales started waning. it has been through two ceos. turmoils been a lot of and they tried to have a partnership with bj's. this cap cupcakes does not sound like a good idea. >> if you look at starbucks, coffee is only one of the many things they sell. >> look at dunkin' donuts. they have been successful convincing people that a donut is breakfast even though it is a treat on par with cupcakes. they are selling breakfast stuff. >> ever since i had two friends

have type two diabetes because they were eating too much cake i've been very cautious. they were just big cake consumers. i wonder if they could've gone through a motive caret cake and other models. healthier cupcakes that people -- it is an efficient way to run a children's party. instead of having a bizarre big cake, you just have cupcakes which should be less than 600 calories. you could probably bring it down to 200 calories if you managed it right. >> he also knows how to plan a children's party. baking,e spectrum of they are the easiest thing to make it home. julie, thank you. >> thank you john a. it stick with us.

>> "market makers" is back in a moment. . .

>> live from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> taking stock -- congress dives into the dark pool and debates new ways of trading equities. >> the meter is running -- sharing service uber cuts prices and says it's now it's cheaper than a new york city taxi. we put the claim to the test. >> golden oldies -- four decades ago -- you want to feel old -- they took us to the dark side of the men and now pink floyd is planning a comeback with the new album. "market makers." i'm stephanie ruhle.

>> i'm erik schatzker. >> just gearhead around that one more time -- four decades ago. 40 years ago -- and cloyd. how are you feeling now. >> pink floyd has been around more than 40 years. since 607i think. dawn." >>the gates of now time for the top business stories around the world. a sanction probe is focusing on .ermany's second-largest bank commerzbank may have to pay half $1 billion to resolve a matter. the mp para bomb was fined for doing business with blacklisted nations. the ceo of jefferies group warns that cancer may be returning to financial services groups. he says they should not repeat behavior that led to the last crisis. those who take risks, he says, are out right cancers. israel has launched its biggest

rounds of attack on -- biggest round of attacks on gaza in years. they pounded hamas and what they say is retaliation against thomas. calling up more reservists. >> on capitol hill, some of the biggest players in stock trading or telling senators how to improve america's equity market with ideas that could reshape the booming business of high-frequency trading and stunt the rise of dark pools. our chief washington correspondent, peter cook, is on the hill. what's been said so far and he was testifying? >> it is really a who's who in terms of the stock trading business -- ken griffin from ceodel sitting next to the of ice which owns and operates the new york stock exchange. you got the top stock trader for invesco. a long list of market participants taking part in this hearing today. the general takeaway so far is

all the improvements in technology, the speed with which stock trading takes place has largely been a good thing for investors, both institutional and retail investors. but there have been problems recently and questions about fragmentation him of the rise of high frequency trading, and whether or not, as michael lewis "id it in his book "flashpoint -- whether things are rigged. we've heard about suggestions for regulatory changes. suggesting more transparency for retail investors and where their orders go. >> we believe the sec should require brokers to publicly report consistent, standardized execution quality metrics in a way that allows retail investors to easily compare performance. we can empower retail investors with information about brokers execution quality and position them to make informed choices.

include ideas restricting orders to regulated list exchanges away from dark pools. he says that transparency is important to everyone. other ideas include more transparency for high-frequency trading, tougher standards for high-frequency traders. not a tremendous amount of agreement among panelists other than more changes need to be made or investor confidence will suffer. >> do you get the feeling listening to senators ask questions of these witnesses that perhaps congress is beginning to embrace the idea that legislation is required to fix what is broken the equity market or are they for the moment still prepared to leave that to people like mary jo white, chairman of the sec? >> i think what is pretty clear is that this is a complex subject matter in most senators in the room with a few exceptions do not understand a whole lot about what is happening in terms of the technology that -- technology

and changes that have taken place and are willing to defer to the sec. hearing is important because they will put pressure on mary jo white to act quickly in certain areas and this puts the onus on mary jo white to move the ball forward. three hearings in the senate in the last three weeks tells you congress does have an issue here but the main interest is lighting a fire under the sec. >> thank you very much, peter cook, on the hill for the testimony on high-frequency trading and equity market structure. >> for more on this, let's bring in a one-time financial regulator who served as a commissioner at the commodities future trading commission. he steps down in march and now he may be on the dark side, we are talking dark pools. he's a senior policy advisor at dla piper bart. you taking a are different stance now that you are sitting on a different side of the aisle?

>> no, that is one of the nice things -- i'm able to keep my integrity in my new job but i am really enjoying it. whati have been saying is i have been saying for five years as a regulator. high-frequency trading is something we need to deal with, but we need to deal with it in a balanced way. we want smart regulation and to ensure investor confidence is increased and there are no nefarious activities. i think that is where the senate is coming from and where regulators are coming from. trying to find that right allen's that can increase investor confidence, not something that's overly burdensome. we have seen nutty ideas, particularly some in the eu recently. we are trying to steer away from that. >> your op-ed in the new york times, you talk about how high-frequency trading moves

supply and demand among traders quickly and efficiently. when you are still at the commission in sit number of 2013, you made a remark that stuck in my head and stuck in the people said -- high-frequency cheer traders are killing them. i just want to make sure they don't kill other traders like end-users or markets. asyou still think of them cheater traders. -- cheetah traders. >> it is cheetah as in really fast -- not cheater. >> yes. >> they are very fast. there --super fast and and they are impressive. hurry ingo bad in a modern markets and that's what we need the appropriate regulations, the investor confidence, and one of the reasons i wrote the op-ed is that i'm really pleased that

there seems to be some in the high-frequency trading community embracing the idea that smart regulation is the answer. these are the white hat guys out there trying to say more needs to be done. >> if you are watching a guy like tim griffin of citadel talking about doing things fair and for retail investors, are you raising an eyebrow? tim griffin does not have a reputation of someone trying to create an even platform or the greater good for all. >> one of the things i've done throughout my whole career, particularly at the cftc, as watch out for consumers and average folks will stop if you talk to tdm or your blackrock, they will say retail investors have never had it better. aen vanguard says it saves billion dollars year for retail investors. but that does not mean it is all

good and well. there needs to be smart regulation and i have been calling on this for four going on five years. that is what the senators are struggling with on the hill as whiteak and what mary jo and the cftc are dealing with right now at their independent agencies. >> who is getting hurt here? there's a lot of people to believe the argument retail investors have never had it better. intont some time looking high-frequency trading in the retail investor doesn't seem to end up on the short end of the stick. vanguard, one of the largest institutional money managers in the world has benefited the market. i'm having trouble understanding who is getting screwed here. >> i'm not sure anybody is getting screwed, but the market is different and things that are different are scary to people.

clearly, the floor traders, the old-school guys are shifting, moving into more electronic trading. been raising all these questions over the years about what is the appropriate response. overall, did ask spreads have tightened them a transaction fees have dropped over the last 20 years. it used to cost $75 to make a transaction and now it costs less than $10. everybody should not just say all is well and good and go away. god-frank, pages of not one word in there but high-frequency trading. morphing market and regulators and lawmakers potentially need to keep their eyes open and be looking around the corner to see what is next to be ahead of the curve. >> do lawmakers know what they should be looking ahead for?

>> is part of this pack finding -- part of this fact-finding mission to several committees are involved in. three hearings in as many weeks. they are trying to figure out what's what and it's a complex subject and at times it scary. is increased transparency. the folks i speak with support increased transparency. that's what i have always been about, so i think this is a good thing happening in capitol hill cftc.g good thing at the >> always great to get your perspective. it's a former commissioner from the commodities future trading -- commodities futures trading commission. >> coming up, dinosaur rock -- why does the music business thing now is the time for a pink floyd comeback? >> it's always time for a pink floyd comeback.

always time to spin dark side of the moon. >> it's not just frozen yogurt anymore -- the founder of red mango is expanding beyond yogurt. you can seeal -- our stories and interviews on bloomberg.com, on your tablet, and streaming on apple tv and amazon fire. ♪

>> this is "market makers" on bloomberg television. i'm erik schatzker and this is stephanie ruhle. the band on the second-best selling album of all-time, "dark side of the moon" pink floyd is going to release their first album in years. these are mainly instrumentals recorded in 1993 and 1994. the big question is why western mark we're going to turn to andy kershaw on.

he discovered the smashing pumpkins and white stripes. is a musicg us editor from bill berard -- from billboard. >> is that the most famous album cover of all-time question mark >> certainly one of them. >> that and probably sergeant pepper are probably the two most iconic. >> so there is a good reason to talk about pink floyd. dark side of the moon sold 14 million copies. million copies. it was on the billboard top 100 charts for 14 years. >> given that the fact that the band once upon a time had that kind of residents with the listener and that kind of resins in the music scene, does it make oute they should be pumping what was left on the cutting room floor 20 years ago?

>> i think there are a lot of people who were thrilled to hear the news there was a new pink floyd album coming out will stop a lot of people would say it has been 20 years too long. >> really? >> they are a beloved and then cross multiple generations. i grew up with them, you grew up pioneerm -- they are a of alternative music and they are still incredibly relevant even today. i think what people are hoping for is they have an album coming out and maybe it's 20 year leftovers, but where is the tour? david and roger touring as pink floyd would probably be the biggest tour other than led zeppelin getting together. >> right now, the money is in live events. >> but there's not a tour that

accompanied the announcement. >> and roger waters is not involved in the project. barely talk to each other. you are talking about two original members, not even the founding members coming together to kind of pick up the scraps. for a 75 word press release that ime across my desk yesterday, could not have been more excited about ambient and instrumental music ever. >> i think it will be interesting in the key for pink floyd, where this is going to be valuable from my standpoint is with a streaming service. this could be a great marketing opportunity for spotify or pandora to stream the material. manynot going to sell that records. the new paul mccartney record sold 67,000 records. inon john's first new record

years was off the charts within 68 weeks. , it's sales standpoint kind of a jan. and a music standpoint interest standpoint, it's great. >> if anyone were to go out and buy a full album, whether it's on a cd -- it's going to be somebody old enough, the kind of floyd.who grew up with >> or just appreciating the format of an album. the long listen, the hour spent, concept from beginning to end. for the was an argument album from taylor swift in "the wall street journal." >> her argument was people should listen to it as a complete project. >> except they are not putting their heart and soul into it. that's the issue. these are outtakes from a lousy record.

>> do you want to write music reviews for "all board?" >> division bell was not a terrible record in the tour that followed it was incredible. >> but let's put this on the spectrum -- division bell and momentary lapse of reason compared with the wall and dark side of the moon -- >> all bands have that incredible time of just is. they had dark side of the moon, wish you were here and into the arguably.nimals, i will give you animals but at the end of the day, it was an incredible piece of work in those years will stop they are never going to measure up to it. should picasso stop painting after the blue period? they still feel creatively they have something to say. whether the audience is huge about it remains to be seen. you think about

taylor swift sharing her views in the wall street journal question mark >> i thought it was really smart. i'm sure some editing when intuit because it was a very well-written story. >> you could say that about anybody. we should not dog on her because it was edited. >> i thought it was very well written, but i think she was making an important point from down is when an artist sit and compose a piece of music that goes from track one to track 10, expected to be listened to as a complete unit. a lot of people don't. they cherry pick songs and that's not what she was going for. >> she's got a full breakup story to tell. >> that is the whole thing with taylor. she talks about being authentic in writing from the heart. that,ling a story like for taylor, that is what makes her connection so special. >> if pink floyd is successful

with "endless river" who else should go back for the outtakes? >> i feel like my heroes who i would love to see like the velvet underground, they are dead. it's unfortunate that is what happens and even with pink floyd -- >> even if they are dead, there are outtakes somewhere. >> we saw michael jackson's album and how that came together through scraps and little pieces of music and i don't know if that worked so well. it depends on the artist. in cloyd, i'm just about. >> a lot of these artists have already scraped the bottom of the barrel. i don't think there's anything left for led zeppelin to do. they are remastering the remasters. >> i want to see the long rumored electric "nebraska." >> what is your summer anthem this year? >> a calvin harris song called "summer." >> i think that is probably it.

>> thank you both. such a treat. >> we will be back in two minutes with market makers nascar canut a race only dream of. versus the new york city taxi. ♪

>> we are approaching 26 minutes past the hour here on "market makers." >> let take a look at today, falling almost 8% breaking below critical technical levels. bingo how the market is doing overall -- you've got to wonder why. >> i'm no expert in technical analysis, but if you look at a fibonacci retracement over the

past month, the next support 36.62.ould be away.ot that far >> those looking for dip, maybe it's here. ♪

>> live from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> welcome back to "market makers." i'm stephanie ruhle. >> i'm erik schatzker. it's time to talk about uber -- the company is launching a new attack on the new york city cap seatback taxicab business. they're slashing fares by 20%, which they say makes it cheaper than a new guard cap. we sent to bloomberg and turns on a race around the city to test the claim. have a look. ♪

>> so it does look like uber came out on top, just barely. i want to bring in the general manager of uber's new york office. i feel like i have two have a disclaimer when you are on. i'm not involved in the company, but i love it and use it all the time. how did uber get here today? >> we've been in new york for three years. we introduced the low-cost version in about july of 2012. we've always been the most reliable ride on the road but we have not always been the most affordable. his change says let's be the most reliable and most affordable. by cutting the price, we are bringing more value. >> how did you get here today? >> i got here by uberx.

>> who is eating the cost? you or the drivers? >> here's the interesting part -- we have all of this great data on what happens when you cut price. cut, so everyone is getting paid less for. but because drivers can do more trips per hour which is a trend we have identified in all of the cities we've done this in, we know that drivers will do more up onper shift and and top. so each ride is going to be less but they will do more trips per shift will stop >> so this is coming out of the drivers park it question mark >> yes -- coming out of the drivers pocket? >> yes. this is an experiment. if it doesn't work, we won't keep it up, but if it does work, it is here to stay. theho is your enemy? is it taxi and limousine commission? >> i don't categorize it that way. we want to bring more choice for

people in the city. the more choices, the better off they are. >> what is your number one roadblock? is the regulations and government? >> the number one roadblock is keeping up with demand. people love it, just like you. while we are adding globally 20,000 drivers a month and a lot of that is in new york city -- it's very difficult to keep up ders as oure see ri customers, but drivers are customers also. getting that many drivers is hard. >> are there violations you face in terms of employment laws having drivers for massive amounts of hours? >> the independent contractor .odel is common it's how new york city works and our laws around that. taxi, drivers on uber have the flexibility to work when they want.

there's no minimum commitment, they can log in and out when they want. they are truly small business owners who can use uber to expand their business will stop versus a taxi, they are committing to certain ships. >> what percentage of the fair do you take? >> we take 20% on uberx. >> and uber black car? >> slightly more. 30%. >> an suv? >> 25%. >> if somebody wants to be a new allow them, do you to partner up? >> we can hold drivers with bad credit get a loan to buy a car. because they are affiliated with uber, the credit risk is lower. otherwise you would have to pay a egregious lee high interest rates or you could not get access all. >> you talk about the greatest challenger can meet faces is

meeting demand -- the greatest challenge your company faces is meeting demand. hamid jobs are being created? >> 20,000 jobs are being created every month on this platform. there are other things you're offering -- is a you mickey? >> i think are our ways that we can leverage the logistic fabric being built. it yet.e not tried >> if you have something and need to send it across town right now. do uber ice, we cream. the app is in your pocket and let's explore other things we can do. >> what is the risk you are charging too little? i loved when you are delivering ice cream for less than nothing. they went out of business.

>> we make a 20% commission and we are in this for the long haul. business and our partners make money and so do we. >> last time i did and uber search, i was not asking if they were charging too little. it got me where i needed to go. >> if you don't want to face the prices, put on your trainers and walk. >> you can take the subway everyday. and itransportation nerd will take whatever the fastest way is. i work in long island city, during rush hour, the subway is better. >> congratulations. i am man uber enthusiast. >> we will be back in a couple of minutes talking about the cold treat that has turned into hot money. we will speak with the founder of one of the biggest frozen

yogurt chains around, red mango. ♪

>> it is time for hot money -- we're looking at businesses that thrive in the summertime. today, we are talking about red mango, one of the world's largest frozen yogurt chains and now they're trying to expand the on frozen treats. the chief concept officer from red mango joins us. why did you decide to transform it into a café? >> when i started the company, i wanted to be much more than frozen yogurt. we wanted to deliver fruit seller help -- food that was healthy and delicious in a stylish way, we are expanding the on that to juice bars and cafés. our first foray was into smoothies. >> is that because you've got too much competition? it seems like there's a frozen yogurt shop, three on a block. the last time that happened was in the tcby craze in the

mid-90's. >> competition is definitely a factor, not just in new york but across the country. the red mango brand is versatile enough to go beyond yogurt. we just launched our first iced coffee. >> is it possible -- we hold these numbers from the international frozen yogurt association. as of last august, they are about to update these numbers again. they had you at 471 outlets. the list goes on. are we going to see happen to frozen yogurt what is happening right now with cupcakes? effectively a bubble bursting. there are too many cupcake shops. >> cupcake atm machine was the signal there were too many cupcake shops. frozen yogurt is different because people eat it for healthy reasons. there are a lot of shops that have the -- that have effected our performances will stop >>

are you really healthy compared to a cupcake, you are -- but one of the biggest problems right now is sugar consumption is very high. >> we do have sugar-free options to meet different lifestyles. other people want natural products, but that is why we are going beyond yogurt. >> smoothies and ice coffee are filled with sugar. ask our ice coffee is not. usually you drink it without any sugar or milk. our express juices, there's no sugar added. --i'm sure you have spent 1 you have spent lots of time studying your demographic. who is your customer and why do you believe that person wants to trade from a smoothie or for yogurt to these other healthy options you're talking about? >> our typical customer is female, educated, -- >> what age? >> 20 240. they are really into eating

healthy and looking for things that are not only healthy but good for you. juice is a good example a lot of our female customers have navigated toward because they realize that a first -- a fresh squeezed apple is sweet. but how do you get men more interested? i would like it -- but the stuff you are describing is something that appeals to me and lots of guys will stop but lots of guys and not go to red mango ordered kale and red beads. he says the typical customer is female and once all the options -- how do you get more guys likeested as to mark >> buffalo wild wings. wings buffalo wild smoothie. >> that is the craziest and most sex -- most sex is thing -- >> the coolest thing is seeing men come into the store and order six kale juices.

>> because they where a lot -- it is manlier. >> they realize how healthy it is and they are not embarrassed anymore. they see with their girlfriends and wives are doing and they want to be healthy as well. >> why do you have 97 locations in mexico? >> we have a great art are there. we teamed up with the theater company, cinemax and they're very aggressive. we are in almost every one of their heaters. it's something people love in mexico. they grab their popcorn and frozen yogurt. >> that is a weird combination. >> what about el salvador? >> latin america in general is a great market. they love fresh fruit, they love yogurt, juice and coffee. it is a great platform for our café program. >> and you are going to expand there? >> we are expanding their. >> thank you for joining us. you can be manly and order a kale at red mango. if you order six, you are tougher to stop thank you.

>> "market makers" will be back in a couple of minutes. ♪

>> las vegas may rule in america when it comes to gambling, but macau rules the world. that's where big casino companies get most of their revenue these days postop betty liu talk to some of the billionaire gaming moguls placing those big bats on the island off the coast of china. betty is here because the newest edition of "titans at the table" debuts tonight and it's all about macau. >> who knew that this former portuguese enclave would become the place where a billionaire would fight against a billionaire all for the chinese

gambler? revenues in macau are seven times more than las vegas -- $45 billion generated in macau every year. it means that people like sheldon adelson, who has made his career building a huge casino empire in las vegas, it means that he generates most of his earnings now from a cow. he's a billionaire aced on the chinese consumer. made 22% of his income in macau. tiny enclave and they are building big and spending bigger. >> if you talk to them and they say there are no limits. we've toward his city of dreams in macau, but he has another resort they are opening up on the high strip.

sheldon adelson says it's going to grow by two or three times more and is putting even more money into macau. andof these guys say -- owns the mgm macau with mgm in vegas. they say they are piling billions in their because there's no stopping it. chinese consumers want to find a new place to gamble. >> what does this mean for las vegas? >> it isn't as if people are going from las vegas to macau. it means las vegas has to keep getting bigger and better and mirror what macau was delivering to its consumers there. is forming a model for other gambling meccas around asia. adelson has sheldon property there. they are doing very well. not quite macau numbers -- japan is the next place they're looking at.

>> which one is cheesier? [laughter] how atlantic city is. >> why do you got to call it cheesy? you are judging and they are making billions. i'm siding with the billionaires. >> "titans at the table" tonight with bloomberg's eddie luke. ♪

>> that would be it for "market makers those quote but i want to share the most special moment of

k'say -- when eri pronunciation was corrected -- let's relive that moment for one second. >> for the record -- it is not kyoto. >> kyoto was the place they really exhibit that. >> what does it tell you that readers would choose here though and not -- >> kyoto. [crosstalk] >> i just love that -- erik schatzker, linguistic superstar getting corrected. >> don't you think i took that pretty well? >> i'm just saying it was a little moment of joy. >> for me, is just another day. , pink floyd,uber frozen yogurt and erik schatzker got corrected.

>> it could turn out to be disney's billion dollar bargain or billion dollar bust. we will speak with the head of youtube channel producer maker studios will stop disney bought it just a few months ago. >> that is going to wrap us up here. it is 56 past the hour and that means bloomberg television is taking you on the markets. scarlet fu has more. in retreatcks are with the s&p 500 and dow jones .8%.y the indexes are suffering their biggest losses since may. doing me for today's options insight is max breyer, options through the -- and options and derivatives strategist. is this the long-awaited correction everyone has been waiting for? >> i think it's a healthy correction. board,are off across the and the markets not telling us much except people are somewhat

disinterested and there's not a lot of interest in the market right now and not a lot of catalyst. and lackng of interest thereof, we've got earnings season kicking off today and you've got wells fargo reporting on friday. does that start to change the tone? >> hopefully. expectations are a little higher than last order and/or a lot of weather-related issues, so we did not know how that was going to shake out. bit highers are a and the expectations and other economic indicators have been positive. a significant deviation from expectations to cause volatility in the market. >> we do see the mix coming back, but that is with a two-day loss we are experiencing. airlines slumping. is across the sector. what are you seeing in the options world. >> the second major airlines carrier preannounced negatively.

this time it was air france that lowered their full-year profit this followed a similar warning from lufthansa about a month ago. this is on the back of overcapacity issues, weak cargo ripplingnd this is across the airline space into the u.s. >> let's get to your trade right now, and it has to do with oil, specifically the etf that tracks oil production companies. they have given back the gains they made since the islamist mozilla. seized >> the so-called iraqi premium has come out of the market. crude rose about five dollars on the back of most old being captured. that five dollar premium has has raised will stop -- been raised. volatility in crude oil is at all-time lows and it looks similar in expiration and production companies also reflecting low volatility. someact is, there are

risks out there. there's tension in the middle east in a number of areas. libya, and of course a rack. we are looking at a potential spike in oil prices which would .e a positive for enp names so an etf that tracks the 82-87ies, we look at the call spread. that costs a dollar and is a nice place to get some spread. >> thank you so much. we are on the market once again in ready minutes. "money clip" is up next. ♪

medically" where we tie together the news and video. the obama administration world tour. in the media, the transformers are invading china. the ceo of imax is smiling. undercuts yellow taxis. and the rise in macau. finally in sports, would it takes to run a euros biggest in