we are on the markets again in 30 minutes. "market makers" is up next. ♪ >> from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> paying the price -- bank of america will be hit with a record penalty to settle the case over toxic mortgage bonds. as much as $17 billion. >> investors get the picture, snatching up fine wine, stocks and -- looking for alternatives to stocks and bonds. >> equinox is buying luxury gyms from coast to coast. we talked to the ceo. ." is "market makers i am erik schatzker.

>> i am alix steel. we are one day closer to the weekend. it is time for the news feed. another sign the legal market is getting stronger -- first-time claims for unemployment benefits hit and eight-year low and the number of people receiving jobless benefits fell last week. a clash of the tech titans over books. google is teaming up with barnes & noble to take on amazon -- shoppers will be able to get same-day delivery of books ordered through barnes & noble delivered by google shopping express. mexico has approved final roles in the opening of the industry -- final rules in the opening of the oil industry which will open up for companies such as exxon mobil and royal dutch shell. by all accounts, the bank of america ceo brian moynihan just lost a battle with the u.s. government on how much will cost

to settle claims on toxic mortgage bonds. bfar a tentative agreement, would pay at least $16 billion. bill cohan is our contributing editor with us from skype to talk about eric holder's latest victory over wall street. it is not really a fair fight, is it? >> it has never been a fair fight. if you go back, he prescribed this when he was an assistant in the justice department. memo wheree holder he laid out, i believe in 1999, this whole strategy for how to deal with corporations that violate these kinds of laws, and basically, the idea was to get them to settle, more or less, more often than not, but he is playing the playbook out and it is not a fair fight. not even close. >> if you are either a customer of bank of america or a shareholder of bank of america, how do you look at this?

, this has to get behind us. let's put it behind us. let's get out with the basic business we have of being a wall street mega-bank and these huge settlement or lawsuits out there do not advance that cause. when j.p. morgan settled for $13 billion last november, the stock went up and jamie dimon got a raise. i'm sure brian moynihan is well aware of that. >> is that to say that jamie dimon got a good deal back in november when jpmorgan paid $20 billion, 13 billion dollars of which went to the federal government. it looked like extortion. and now bank of america, which is similar to jpmorgan bought companies, one of its own volition, one at the urging of the federal government, $16 billion to $17 billion as opposed to $13 billion.

>> there is always a first mover advantage and in this case jpmorgan got the advantage. we also do not know the documents that say what these banks did wrong. we will never know. that is one of the downsides. the complaints they threaten to file never get filed and therefore we never know what really happened. these settlements are interesting, which are supposedly good for the government, these huge influx of cash, supposedly good for the companies, but it is bad for the american people because we never find out what really happened. att is what dennis kelleher better markets has said repeatedly and i think he is right about that. the biggero ask question, why do these big banks keep getting analyzed for making purchases the government try to get them to make during the crisis. bank of america made 4% of the loans that went belly up. how is that fair? >> we do not know the details. that is one of the problems with

these settlements. that iose off something can america itself, not merrill lynch, not countrywide might have done. we do not know what jpmorgan itself did wrong versus bear stearns or washington mutual. part of the thing that is going on here is they are closing down information we would normally expect to get. if there were a trial or a complaint filed, we would see the details, e-mails, documents, and it would hurt the idea that we were just doing what the government wanted and did not do anything wrong. waxing this case, it is a little bit different. it is fair to say it is a little bit different than jpmorgan. >> look at countrywide. >> bank of america bought countrywide had its own volition -- on its own volition. in the case of merrill lynch, the government was trying to save lehman brothers, not really merrill lynch. the world did not know what trouble merrill lynch was in.

of bank of america the time thought he was doing the right thing and probably getting a great deal when he bought merrill lynch, although we look back at that and say thank goodness he did even though the favernment had to bail out bo twice, at least it was a backstop for the massive losses. >> we can debate what ken lewis new and what -- knew and when he knew it. there have been lawsuits that ken lewis new shareholders were losing money and they had lost and than had been let on the information should have been disclosed to shareholders before they voted on that. look, the bottom line is when you are negotiating with the federal government, you use the word "extortion." i would agree with that. you do not have any choice. they are going to get their pound of flesh if you look at the history of these negotiations. some sort oft low,

reasonable number, and then it immediately moves up to what eric holder wants. that is the blueprint and he wrote in 1999 and it is still operative today and it is been implement it. these banks have to get a b them, and did not have much choice. -- beyond them, and they do not have much choice. >> i want to share a stunning figure -- if the justice department extracts $16 billion to $17 billion from bank of america, total amount they would bee spent four claims would $71 billion or $72 billion. it takes bank of america on an operating basis at least three years to make that much money. >> it goes to show you that the countrywide deal might have been one of the worst deals of all time, and the merrill lynch deal was not much better, although you could argue that if it were not for merrill lynch now -- merrill lynch is now offering a powerful engine to bank of america now, but countrywide -- oh, my god, why they spent that,

who knows. indeed.my god," >> $71 billion. that is unbelievable. stunning. it is a most $50 billion before you add the $16 billion -- it is almost $50 billion before you add the $16 billion. russia is striking back -- the prime minister is restricting things like meat, cheese, fruits and vegetables. we're looking at what the impact will be on the u.s.. scarlet fu, overall, the farm export market is 150. dollars. it is huge. what will russia do for us last >> this might be a case that the bark is worse than the bite, because the headline sounds fooding, this ban on

products, some partial, some complete. it does not count russia as a big market. russia makes up less than 1%, 0.9%. in terms of dollar value, that works out to $1.3 billion in u.s. exports shipped to russia in 2013. are a of reasons why it is small -- rush already restricts u.s. beef.turkey, and >> there was some concern about a feed additive from countries like the u.s. and brazil. what struck me was chicken because we still export about 7% of chicken to russia. it is not that much. you could argue it is not that big of a deal, but somebody is losing money. >> somebody is losing money from that in the united states. you wonder -- what does it mean for u.s. multinationals operating in russia -- someone like mcdonald's, for instance.

would you they get their supply? reasonably they were getting it from local producers or producers in europe. -- presumably they would be getting it from local producers or producers in europe. they would be hit with the sanctions. that is a big question -- who is the pain going to be on. if it is not on u.s. companies, the u.s. agriculture industry because it does not count russia as a big market, will it go on ordinary households. >> sure, you cannot just snap your fingers and have a chicken. it takes a while to grow. >> the pain will most certainly be on the russian people. >> it is some thing to watch out for. there are different views. >> they have opened up imports from brazil at the same time. >> good for brazil, but you make the argument he could be bad for us -- other european countries like poland. >> eastern european farmers will be hit harder than western european nations and the united states.

>> and economy minister says these farmers need some sort of compensation. >> the next thing you want to watch out is the ban of western airlines from transit flights over siberia on the way to asia. that could hurt because you're talking about longer flight times, fuel costs. a different story. >> scarlet fu, thank you. love talking about commodities. >> coming up, rupert murdoch says he is done trying to buy time warner, but nobody really thinks we are finished with media consolidation. >> plus, equinox is getting pumped up -- we will talk about the health club chain's latest acquisition with the ceo. ♪

>> first. bloomberg. " onhis is "market makers bloomberg television. i am erik schatzker with alix steel. you not often see two multibillion-dollar mergers disappear in the space of a half-hour but that happened when

fox dropped its bid for time warner. the media world is reeling and wondering what comes next, and so away, so we turn to our roundtable. "bloomberg west" editor-at-large cory johnson is in separate cisco. paul sweeney, bloomberg and out -- san francisco. -- paul sweeney. let's begin with chase carey speaking yesterday on a conference call. , firstto say something saying "let me be clear, we are done. we have no plans to pursue a third-party content company as an alternative to time warner." do we believe him? >> in the near-term, i say yes. those are strong words. if they were to buy a third-party content company at this point some people would question, what are you talking about.

there is nothing else out there that foxx wants in the united states, and that is why i believe him. a lot of the companies that are theoretically for sale do not match up to time warner, which was not for sale, so they cannot get that done, i do believe him. ande were talking yesterday you were talking about fox being interested in b-sky-b. >> i spoke to a lot of investors after the call. the message was modeled. we do not need scale. , we do not need scale, which to a large extent this true, but then why did you bid for time warner because investors believed you are doing it to get scale. investors thought it was all about scale, and other company is saying we do not need scale. i think everybody step back and said we did not get this deal done.

there were probably missteps, that advice, and i suspect as alex, they will reassess at some point, line. the.ok at the statement, he said "as an alternative to time warner." to me, that did not categorically say they are completely done with time warner. >> but they did say the decision to dump time warner was resolute. i do not know, what is resolute cory? mean, >> i do not believe that rupert murdoch has made a strategic decision about where you want to take his business and at the first sign of resistance he says we are done. >> i think part of the scale confusion is -- i think fox is trying to send the message that we do not need scale for the

sake of scale, so do not expect amc, but scripts or time warner, we asked it in because i -- we are interested in because they offer something others do not. >> you have been following the , what does it say to you that we could see two deals of this nature go up in smoke so quickly? two deals that seems so logical on the surface -- 20 years ago, rupert murdoch would have done this deal no problem, shareholders, bondholders, be dammed. what explains the sound reasoning behind not pursuing time warner? is it activism lurking in the background? think it 83 years old rupert murdoch has really learned a new trick and that is to work for shareholders and that has made him much richer. >> it all about self-interest.

>> instead of being an empire builder, he turned into a new lease, work for shareholders, grow our business, and return cash to shareholders in the form of buybacks and dividends. when a strategic deal comes along, we will take a look at it, but what has worked for media companies and media moguls is to return cash to shareholders, much different than the 1990's and early-2000's , when they were an empire-building mode. >> i spoke to one person close to fox who said the hacking scandal was a turning point. he has been more disciplined. , keep us honest. you do not believe it. >> i totally cannot believe it. i think the situations are different. i thought the big news about the sprint-t-mobile deal was really the fcc's chairman comments the day after saying he thought it

best for america to have four andrate carriers of scale, i think that is an empower -- an important and powerful statement. it shows you how resolute the fcc would be in opposing this thing. >> as i said at the outset, it has left us wondering who comes next, who will step into the fray, and this is bob iger, the ceo of the walt disney company talking to jon erlichman about this very question just two days ago. >> we do not typically, to about the potential for an acquisition. that should not mean we are interested in this. they have some great assets, by the way, and we like content, but that, again, should not in any way mean that we are looking to acquire them or any part of them. >> so, that makes it feel as though disney is taking it aht out of the ring. if it is not going to be disney,

could it be comcast? >> or amazon, or netflix. >> or google. >> when this deal was being talked about over the last several weeks people were saying is this going to be they opportunity for a big tech company to do a transfer marginal transit -- transformational transaction? i hate to reference the aol-time warner deal, but would google or apple look at this as a one-time opportunity to establish in the media space with time warner and we have heard nothing out of silicon valley. , go ahead. >> a lot of this business is the cnn, hbo, not -- just as the content creator, but as a ditch of each and network. , important assets part of the cable industry, and i do not know that anyone in silicon valley wants to get into

that highly-regulated, wonderful cash flowing business, but slow building system. >> we know that goldman was invited -- advising fox. they would love to find a way to capture the fees they would have earned if this deal had gone through. >> there is no question that every single media banker for the last six months has been coming up with different combinations and pitching them to all of the media companies out there to try to say, look, this is the best synergistic fit. pimm fox and --fox and time warner -- that domination makes as much sense as anything out there. the two go together. takes $6 billion and gives it to shareholders, that is a little harder to pull off her >> -- pull off. >> agreed. in the near-term, it has been

said wait until the time warner comcast deal goes through and that we could see more deals. >> thank you to the three of you. and sherman, paul sweeney, let's not forget cory johnson in san francisco, our "bloomberg west" editor at large. we have already forgotten about you. >> never. coming up, our hot wheels a place to put your money? some might say yes. we look at the best alternative investments. ♪

-- a drinkp for some for some, an investment for others -- how fine wine can be one more way to grow your money. >> plus, the russian hackers that stole more than one billion

usernames and passwords -- we're going to see how they go they threatened they actually are. threat theyf a actually are. ♪

>> from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> i am erik schatzker. >> i am alix steel, in for stephanie ruhle. when you want to diversify your portfolio, alternative investments are what we talked about -- only truly alternative assets like fine wine, art, stands, and sexy cars. we crunch the numbers to find out what worked for investors and what did not. noon wrote the story --

suspense, the number one alternative asset class. >> extra space storage reits, complete supply -- surprise to us. >> it should be. >> this is when you do not have enough room and you buy a little cubicle. as ant is packaged investment. >> there are several, graphic trends, the first is the lack of homeownership, 67 .4% homeownership rate in the second quarter, the lowest in 19 years. >> it all makes sense. >> people are not upsizing. >> they are downsizing to apartments. >> or they are living with their parents and need the extra space. extra space, the things you accumulate, kids toys, furniture, gifts from in-laws -- all the things you want to keep but not in your home. what about private equity. >> it has done well.

it was second in our ranking over the past three years. private equity is owning companies all around us and all of these companies have done well as the stock market has done well. ipos have done well. private equity of these have turned holdings into public holdings to sell them off and they have done well as the markets have done well. -- the financiers who run some of the financiers who run private equity firms have been telling us over the past year or two that those returns will go down because market multiples are rising, they're being forced to pay more. even though they could get leverage, it is possible that over the next 3, 4, 5 years, those returns will not hit 15%. >> they are selling a lot, but not necessarily buying a lot. >> sure, let's be honest, this is backward looking. we are looking at with the best was four three or four yours if you're smart enough to get in three years ago.

looking at the next five to 10 years, the entry multiple you are looking at is a huge variant i never return. it is difficult -- variant on your return. it is difficult to find bargains. >> what did not work? >> hedge funds, designed to provide protection when rockets are not doing well, they have not been doing well on average. , oddities have not done well if you think about --, oddities have not done what -- commodities have not done well. >> although pigs, if you invested in lean hogs, you are a happy camper. >> you have to figure out the driver. in the pigs case, there was a supply issue. there was a disgusting virus that killed pigs across 27 states. supply was dwindled. >> what about some of the stuff that i refuse to call alternative investment, and i am pleased to find so do you -- you

call them exotic, things like stamps, line, cars, for example. >> as we were talking before the break, we are talking high net worth and ultrahigh net worth, people that can buy a garage for ferraris as an investment. these have done well. spent 2009, said i 2010, 2011 working -- worrying about my company, trying to get my business back on its feet, and now that it is back on its feet, i have money and i will look at cars, my passion. >> that is the thing, he is looking at cars because he is passionate about cars, not necessarily because he believes the car will be a great investment. >> that is true. >> it is like gold. it is confused by the way people feel about it. >> it is only worth what somebody is going to pay for it. >> everything is worth what somebody will pay for it. >> it does not have intrinsic value like hong -- hogs.

>> when you look at a couple of hundred bottles for a bottle of wine, if you are an amateur investor you think you might able to make some money and some have done well. >> what about contemporary art -- in the last graphic we had shown that was down but all we hear about is blowout auctions that somebody's and christie's -- sotheby's and christie's. what is going on here? >> you're talking about doubling your money. >> like jackson pollock. >> sure. , theirff from these guys art is on exhibition this year. they are doing very well. >> how do we find the data? --the markets tracks several bloomberg markets tracks several indexes. our looming terminal has several indexes. >> thank you data rich. >> for -- thank you data rich.

>> for hedge funds, data reits. >> i guess you're going to have to buy some cars. >> i buy wine to drink. >> at some point i will again. thank you, devin banerjee. >> a russian hack attack -- more than one billion usernames and passwords were stolen. you probably heard about this. we'll talk about how to prevent it from happening again. ♪

>> it could be the largest known no, that isate -- not what we're going to talk about. we're going to talk about working out because erik schatzker loves to do it and equinoxes building up its empire, and joining us to talk equinox, harvey spevak. avid working out guy. >> i am in equinox customer. customer.inox

>> you're making in a position. what is the goal? >> we acquired six clubs in locations,ities, and new york, l.a., separate cisco, and theyiami and d.c. fit well in our collection of trophy assets. the members are aligned. it is a great opportunity to serve members better. >> is this a real estate play at the end of the day? you're getting a lot of square footage. >> we are getting square footage, but we are an operating business. --re is underlying business real estate, but it is an operating business. >> how profitable is the gem business? that depends on where you operate. it is a mom-and-pop business. there are more bad stories than good stories. we are one of the few good stories. >> why are you one of the good stories? >> we have profitable, have had a successful run and we have a good future ahead. >> to what would you attribute

your success because there are some small competitors, larger competitors -- and the city alone there is crunch, new york sports clubs, just a big. you are to a degree competing with them, and to a degree not. you are going for a different customer. >> it has trained -- changed genetically. -- dramatically. in theboth by definition fitness club industry, but equinox is positioned in terms of who we cater to a we offer dramatically different than others. >> we tend to see a lot of fads that come into play. currently it seems to be crossfit. what is a trend you want to invest in? >> we have expertise and talent and industry. we have 13,000 employees. we are constantly either starting or observing. it is a trendy industry. some of the things that you see today like studio cycling, spinning, it has been around for

a long time. yoga has been around for a long time. what it is as more people more aware of healthy living. people are more aware and engaged than ever before. >> how do you define your customer question mark who is this person, where is the income level, -- customer? quizzes person, what kind of income level -- who is this person, what kind of income level? i know the -- >> i know the answer. it was an "men's fitness." it is erik schatzker. >> it is true. that is where i go. there are people in this town that are high-end, that go to private clubs. where is the cut off? end consumer,igh

median age is 40, household income is north of 250,000, net worth is in excess of $1 million. they are luxury buyers. this is a high net worth individual and part of what individual wants is more so they are willing to spend on more programs and services if we provide a valued and help to get the results. >> clearly they want results, which means they have to have access to equipment and they want to feel like their money -- they are being rewarded for the amount of money they are spending, between $150 and $200 a month at the equinox as opposed to $50 somewhere else. how do you keep it exclusive enough, because i will acknowledge that some of the equinox facilities that i have gone to are looking a little worn around the edge and do not feel as exclusive as of the locations. >> i do not -- we do not refer .o ourselves as exclusive we are high-end, and i will say in new york he had had a great challenge wearing demand is

outstripping supply -- where demand is outstripping supply. we pride ourselves on never overcrowding clubs. we are trying to stabilize that. >> does that partly explain the slightest -- latest acquisition? >> that helps, certainly in the new york environment. yorkill see in the new market, we are opening new clubs , bryant park, brookfield place, at the end of the year. we are working at -- on other deals in the east 90's and hudson yards. we are expanding rapidly to handle the demand that we will be said actually an existing locations. >> a lot of traders that i talk to, who seemed to be the client you are referring to, are opting for something grittier and something more like a community like crossfit rather than higher-and gems. >> obvious that, but what i

talked about we complete -- compete favorably. it is cyclical. at the end of the day, we deliver results for our members, and a lot of those places are unsafe or do not deliver the same results. if you want an equinox experience, there's only one place to get it and our history speaks for itself. >> you are here in new york city, in los angeles, northern california, boston, florida, toronto, london -- where else are you going? >> outside of the united states we are looking at vancouver. we are doing well in toronto and london. we have your plans for london. we think it could be our third biggest market. there are other cities in the u.s. we have not entered yet. >> like what? >> seattle is what we are looking at, we signed a deal in houston. we are not growing is for growth's sake. we are continuing to answer some of his other cities. >> harvey, two workout routes

next to me. want to check you out erik schatzker and find out his workout regimen, pick up "men's fitness," on stands right now. >> coming up, we will talk about something else -- russian hackers and their online hall than one billion usernames and passwords. you will find out how serious it really is. ♪

>> it could be the largest known hack of private internet information ever. reportedly, a group of russian hackers has stolen 1.2 billion usernames and passwords from websites large and small commentor and here to explain what it means for you and what we can do about it, the cofounder of crowd strike, a company that identifies cyber threats with us from las vegas

where a major hacking conference is being held. is this the largest known hack? >> the numbers are obscenely large, up to 1.2 billion usernames and passwords are stolen, but what your users need to realize is these things happen at good regularity, unfortunately these days. over the last year, almost $200 million -- 200 million usernames and passwords have been leaked. >> we need to cover a couple of different things. a lot of people will listen to about oneat or read point 2 billion usernames and passwords been collected, and say what should i do? should i bother conducting business online at all, or do i go back to cash? >> there is something you can do. for individuals i recommend having random, secure passwords and different passwords for every site. sites like banking

sites, are rarely compromised in this fashion. might not have leaked from that site, but if you're using a password for a site you signed on to get your magazine subscription or download free software, and you use the same password, that is a problem because criminals will steal it from the insecure site and tried everywhere they can turn that reuse will really -- they can. that reuse will really hurt you. >> it is also -- is it also a case where the passwords themselves are not that the tomato, but what they could tell us about identity in the big picture? >> it depends on where those passwords can lead us to. if the password can get the criminals and your dmv records or other government records where they can retrieve personal information like your date of birth or social security number, that can lead to identity theft

can lead to identity theft and cause you big problems down the road. >> dmitri alperovitch, why haven't more providers, service providers, which is to say websites, or the online versions of stores and companies that we combine business with, gone with two-step authorization -- like when you buy a concert ticket -- you have to enter your account these and then fill out screens to get to the point where you buy the ticket. >> that does not help as much. they just slow you down and prevent criminals from trying a lot of passwords again and again. what is known as a two-factor identification system where you have a separate token. it might be on your phone, or hardware, that you need to use, and companies need to use the two-factor authentication.

>> we do that here at bloomberg, as you would expect, but i cannot see myself walking around with a j.crew token that i will use to log into j.crew.com one i want to buy a tie, shirt, or some boxer shorts or something. >> these days you do not have to have a hardware token. free software called google authenticator that gives you different tokens for different applications. it is very easy to use. the solutions have evolved quite a bit. the thing that companies need to realize is the credentials for the user base have likely already been stolen in the credentials can be used to try to target his company's, break too companies like bloomberg steal sensitive information. so, they need to operate on that assumption, and any to use secure solutions to look for intruders on their networks, solutions like proudstrike -- crowdstrike's software can do

that really well. >> what is the likelihood that companies will be able to stay ahead of it? the average total cost is 15% this year. can they outsmart the hackers? >> i think they can. the thing they need to use is proactively looking out for hackers, and utilize intelligence, look around the corner, understand who is targeting them, how they are foreting them, and use that resource allocation. you cannot defend everything against everyone. you need to prioritize, and intelligence can help you do that. >> dmitri alperovitch you have had experience yourself exposing hacks. in this case, it is another company called old. businesstitive is that trying to expose security breaches? of security a lot companies doing this in a way

that is responsible, notifying victims first before coming online, and doing this is a so thatervice individuals can understand, and companies can understand who is attacking them and why. so, i think there are really good-- there is a really responsibilities and security companies do have to educate the public, and if it is done correctly, i think it provides a good public service. >> what is the role of government? we were talking about russian hackers -- it is an offshoot group in the country, but what is the responsibility, or the complacency here, of the country? >> we have had a lot of problems with russia, and odyssey today we have a lot of problems with russia, cyber crime being one of the smaller ones today, but the challenge is russia has not prosecuted cyber criminals and they've created a cesspool of highly organized, no operations that are doing this day in and day out and they are doing this with impunity, and that is a big problem for us and for u.s. law enforcement. >> dmitri alperovitch you say

people like yourself and the folks at hold are providing a public service, but with some hackers it is not so clear. they call themselves black hat hackers, who are they, and what does that mean? >> typically, when you have the word hacker, it does not always have a negative connotation. the white hat hacker is typically tried to do good, responsible. the black hat hacker is doing this for criminal notoriety, financial gain, and this group falls in that category. wearing hisou are white or black? >> i'm definitely a white hacker. >> or gray. >> dmitri alperovitch, he wears the white hat as the cofounder of crowdstrike. when we come back on "market makers," arrogance in silicon valley -- surely, no, but there is an article on this in the new

"bloomberg businessweek." when we come back we'll have more on that in just a minute. ♪

>> from bloomberg world headquarters in new york, this is "market makers" >> from bloomberg world headquarters in new york, this is "market makers" -- >> from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> arrogance on silicon valley -- the price we have to pay. the billionaires had better watch out for the pitchfork. >> the next big thing in cancer research -- we will talk to the cofounder of one of the best funded startups in biotech history. ," onis is "market makers bloomberg television, and once again i am erik schatzker.

>> i am alex hill, in four stephanie ruhle. happy little friday. -- alix steel, in our stephanie ruhle. happy little friday. time for the newsfeed -- bank of america might have to pay as billion.0 -- $17 the justice department has threatened to take the matter to court if they did not come up with more money. facebook is taking steps to detect themselves against hackers. the social network is acquiring makes software. it was started by security veterans from google. president vladimir putin is retaliating for the u.s. and eu sanctions over ukraine. russia is banning a wide range of european and american food products. last year, u.s. food made up just four -- is 4% of the total imports. >> about one month ago we brought you a venture capitalist

that was causing a big stir, not so much with his investments, but with his rabble rousing, and columnjust penned a entitled "the pitchforks are coming." we wanted to know more about this man, who he is, and how he made his fortune. that is why nick hanauer is with us for the hour. tell us about yourself. who are you? >> well, i am a serial entrepreneur and venture capitalist. i have been starting companies , and i was a wee boy have either cofounder founded 35 companies in a wide range of industries, but i grew up in a family business that still exists that makes pillows that i had a very early interest in the internet. i was extraordinarily fortunate to have a friend that shared the interest, and his name is jeff

bezos. toended up sending his stuff my house and i was the first and best -- one of the first investors in that company. i cofounded another company that is a internet advertising company that we sold to microsoft. >> how did you know that this was the thing that was going to take off, and that amazon was going to be the ticket? >> or did you? clear, --nd in, to be well, i mean, to be clear, i knew internet advertising and internet retail would be huge, but i would be lying if i told you that i knew they would be as huge as quickly as they were. thatse i ran a company sold to every kind of retailer in america, i had a unique perspective on the dynamics of retail. department stores, mass merchandisers, wholesale clubs, catalogs -- i could do strategic

arithmetic that few people could , so i could see when the internet came along and software improved that buying things onlinewould give retailers a massive advantage over conventional retailers and, as luck would have it, jeff bezos had come to the same conclusion and i begged him to let me help, and, you know, as luck would have it, he let me do that. that early look allowed me to see that online would allow advertising to be accountable in know,me way that, you some other forms of advertising were at the time, and that would overwhelm traditional advertising, so we started a quantum. >> are you still in amazon investor? >> i am not. >> are you and jeff still friends? >> yeah, yeah, yeah. you know, he is a hard man to see. i do not really invest in

private -- public companies. i only invest in private companies. when i was no longer a board advisor i sold my stock. i did extraordinarily well, although i wish i saved some because it has gone up from there. i tend to sell stock in companies after they are public. >> and repurpose the capital. >> yeah. >> you are more an early stage investor. >> our idea is a one-page summary and a couple of entrepreneurs with an idea. we do not need any proof of concept. we want to be the first money into one inch an idea backed by good people. >> what is your biggest mistake? >> there are thousands. my favorite mistake and i have a sock puppet to prove it, i made in50,000 dollars investment pets.com two weeks before it was going to go public because this guy told me i was special, we have a special deal for you -- you can put 150,000 into this

company, and pets.com, the -- who idea in the world wants to buy pet food online when you're going to the grocery store anyway? in a matter of week the stock price from pets.com went to drill bits, seven hits, three --rters, one half seven/eight, three quarters, one half, and then it was all gone. in my office i have this marvelous sock puppet that pets.com used to sell. puppet, $150,000 sock the most vested in history, although others probably sold more -- invested more. it is a great reminder that you should keep your wits about you. >> what about your experience in the.com bubble and the bursting of that bubble that has prepared you better for what has happened now question the the you see the same stuff -- happened now?

do you see the same stuff happening now that you saw back then? >> these business cycles are cyclical, they go up, they boom, and they buzzed. i think what you have to do is be very disciplined about how you think about investing. you know, my own theory of investing is that i look for opportunities to bring transformational value to customers. that is to say a product that is either 10 times as good, or 1/10 as much as the alternatives. if you do that, if you invest in those things, over the long term, i think, you're going to be quite safe. they may look like they are worth less than you think it sometimes, and they make be worth more -- they may be worth more than they should be at other times, but in the long haul they will be ok. we went to that progress -- process when we went public. we were valued at much too much

-- far more than what we were worth, then the whole thing crashed, and we were a fraction of what we should have been. over time we proved the business model -- we became a big company that generated a huge amount of cash and we were bought for a lot. >> at -- if you look at the investments you have made, are there common factors that explain success? the beauty is your downside is limited to what you put in and your upside is almost infinite, but if you put too many chips on too many numbers in the roulette wheel, you will not make any money. >> the big secret of venture capital is if you look at the returns on venture capital, they are actually terrible. if you take out the top 10 performers it is a terrible business because most people, actually, are not very good investors. but i believe, and what has made us successful, and me successful, is this notion of creating transforming amounts of value for customers.

whoever it is that you are serving, doing whatever it is you do -- you have to find a way, and i believe there is no example of a great is this anywhere in any business that walmartstart out, from on, by offering a transforming amount of value for the customers they were serving. >> is that your roadmap? >> totally. >> what you sell them with? >> how much value we will create for the customers that we serve, and we are reasonably consistent in our approach to that. now, the thing is, of course, you can be totally wrong. [laughter] you can be wildly, completely wrong about the amount -- your ability to do that. you can make technology mistakes. you can make execution the stakes. >> nick, you may money, clearly, in your amazon investment, lots of money, and elsewhere along the way you have made money.

how is that change is a person? >> my wife and i have worked very hard to avoid what i think one of the biggest did -- they pitfalls of -- wealth is -- i have a life that only most of the can only dimly imagine. >> he can qualify you as the .01%. >> to be clear, i am worth less than $1 billion. i'm not a beginner. i am not sure that -- billionaire. i am not sure there is a real difference with how one lives. we hang out with people more and more that i like that. i think that is a bad thing. i think it is super corrosive to the democracy to have this unique manner cut off from the cut -- this elite who are off from the real, live and experience of what we go through. it is a problem that we face as a society. >> we will talk about this after

a short break. we'll income inequality lead -- will income inequality lead to disruption? nick hanauer is here. and the former that romney advisor lynn chen. >> will talk to a company cofounder as well. ♪

>> first. bloomberg. >> welcome back to "market makers." i am alix steel here with erik schatzker, and our guest, host for the hour, venture capitalist nick hanauer. we want to talk about the inequality debate. make has been outspoken, and it wantproblem people should to solve to protect from a populist revolution. we want to bring in lanhee chen, a fellow at stanford university, and he was the top domestic advisor to mitt romney in 2012. thank you for being here.

from a want to read column you wrote that went crazy -- 300,000 views on facebook. you say "if we do not do something to fix the glaring inequities in this economy, the pitchforks are going to come for us. no society can sustain this kind of rising inequality. in fact, there is no example in human history where wealth accumulated like this and the pitchforks did not eventually come out. there are no counterexamples. none. it is not if. it is when." are we looking at a french revolution here question mark what are you thinking -- french revolution here? what are you thinking? >> to be clear, it is somewhat tongue-in-cheek. the problem is not that we have any quality, but it is at historically high levels and growing every day and the trend continues the top 1% will go from 8% of income 30 years ago,

two over 30% today, to another 30% in the next 50 years and the 12%, to go from 18%, to 6%, and then you are looking at a new meal feudalistic society like pre-revolution france and we have to find a way to mitigate that because it will either lead to social destruction or it will destroy any semblance of a real capitalist economy. >> before we get to the solutions, lanhee chen, you seem like you fundamentally disagree, that inequality might not be on the rise at all. what is your thinking? >> it depends on the measure -- mobility,k at intergenerational mobility, i think what you see as we have a relatively upwardly mobile society in america today. i do not think there is any question that we have any quality in america, and neck has a sport -- has a point and can speak to that, but the degree,

the nature, and how to we deal with that is the question. , from a political perspective, doesn't make sense to argue about measurements? make sense to argue about measurements? there's been criticized -- thatcism about datasets were used to reach conclusions, but at this point is that not the ship has sailed, that inequality has become a buzzword and whether you were anyone else likes it or not, it will be an issue in the next election and the one after that, and we have to find a way to talk about it, whether you are a gimmick right or a republican? >> -- whether you are a democrat or a republican? >> it certainly said -- has. there is a perception that we had a problem with any quality, and the issue becomes how do we deal with that, creating more upwardly mobile society and that is what the debate should be --

over policy, the right solution. that is a fruitful debate to have. >> let's get into it. nick, one of your solutions is raising the minimum wage to $15. why are you so convinced that will solve it? >> again, to be precise -- >> precision, by the way, is a good thing. -- $15 is agood halfway number between if a track for inflation and productivity growth. we know $15 is supportable by the economy. the point is not that the higher the minimum wage goes the better things will be, but the point is we have to bring low-wage work back into balance with the rest of economy. if the minimum wage tracked the weights of the top number 1% it would be $28. so, $15 nexturf sense in a high--- makes perfect sense in a high-cost city like seattle, and less sense a town like kansas.

is to goequitable way at the same time. all businesses get the benefit and can compete. >> lanhee chen? >> well, we have seen the outcome of interventionist policies like raising the minimum wage. over the last couple of years, we have record high poverty, record high usage of food stands, lots of people on welfare. the answer, i do not think, is for government to get more involved. i think raising the minimum wage is an interesting debate because obviously in some jurisdictions it does not make a lot of sense, and in others it might. i think jurisdiction should have the ability to make those decisions, but at the end of the day do we want government to be in position to say it will be the one that will come along and solve this problem because i think the last four years have demonstrated it can not. , i thinklanhee chen that is just ridiculous. we have poverty in the united states because we have not done anything with the minimum wage

in really, very long time. the real point is it is just ridiculous to say that if we keep paying workers poverty wages than they will not be in poverty. obviously, if we raise the wage, those workers will be much better off. it is just ridiculous to say the government has no role in trying to create a virtuous cycle rather than letting the most rapacious capitalist lead a dust , and you know, it just does not work like that. ?> why what's here's the thing -- washington state has the highest ,inimum wage in the country $9.30 an hour, and it is not just normal workers, we take it workers nine dollars to two cents an hour -- nine dollars to two cents -- nine dollars and

$.32. seattle is the fastest-growing big city in the country and washington state is generating stateobs than any other that the fundamental law of capitalism is when workers have more money, businesses have or customers and need more employees. .hat is what is happening >> well, i think that assumes that the only factor at play in how well workers do and how many workers are is the minimum wage. obviously there are a lot of attractive things about leaving -- living in seattle or the bay area. if the answer is raising the minimum wage, let's raise it to $28 or $30 an hour. we can never raise the wage high enough to support the kind of solution to an equity. >> i did not say raise it to $28 or $30. >> i realize that. -- idid not say to raise said to raise it in balance with the economy. i am not saying it is the only solution. i am not saying we will fix

everything, but it is a tool available to us that sensible capitalist should support. when workers earn more money, businesses have more customers and need more workers. when workers earn a reasonable wage, taxpayers are spared the expense of funding footsteps, medicaid, and rent assistance that we now have to pay for. it makes common sense. >> i think there is a reality here that the raising of the minimum wage above a certain amount will have a jobs and packed. how much we can discuss, and some of those arguments get overblown, i agree with you. but let's face the facts. you can never raise the minimum wage enough to solve the problem. >> i am not saying it will solve the problem. >> then what of the other solutions that will go beyond raising mm wage, because i can tell you something, that will not be the end of it. if you begin with a discussion, why not raise tax-free, top 1% to 50 percent or 60%, create

more. taxes on income earned through income -- raise taxes on earned through capital. that is where your argument will leave -- a lead. you can never raise taxes enough, minimum wage enough to solve the problem. you have to invest in early education, some of the things that will create a different. >> we are in agreement. you have to do those things, but where is the money going to come from if you do not tax the people who have the money? think lanhee is dead right. abovehould be taxed at 50%. by the way, whether it is capital gains were carried interest, or dividends, or regular income. the country would benefit massively from the investment that those higher tax rates would bring.

there is no truth to the claim that that will kill growth because that is not where the growth comes from. >> what do we do about the other problem, which is stagnant real household median income? there, we are talking about the middle class. when you're talking about the minimum wage, you're talking about people the bottom end of the labor force. >> absolutely. >> so, why don't you start question mark >> --why don't you start? >> we have to find a way to get american companies to more value split. traditionally we had unions that used to do that in our country and we stand a much more robust middle class because unions successfully negotiated better splits. now, i'm the first to a knowledge -- >> you can make the case at a competitive cost. you can make the case. keep going. eight could make the case at a competitive could -- at a

competitive cost or not. walmart has workers that among the biggest recipients of food stamps in the nation. walmart could afford to pay those workers more, earn slightly less, and there is no impact to consumers. we just have to split the money in a different way. >> but, again, the walmart worker is not the guy at the median of real household incomes. >> you are talking middle-class. >> something closer to middle. >> here is the thing, if walmart workers paid their workers a little better, two walmart workers together would be middle-class. earn $15 an hour working for walmart, two those people make 50. , we all agree a focus on education is a good thing, but it is a generational transformation. these are political issues today.

how do we address the median income problem now? >> is a great question. we have an economy right now that is not generating the right progress for the middle-class. the reality is we need to set a policy that will encourage middle-class job growth, manufacturing job growth, and that means fundamentally looking at our tax code and getting the orbit welfare, loopholes, making investments in a regulatory structure that is up to date so that businesses can grow, invest, angry the kind of jobs they need. the answer, again, is not to say "hey, walmart, pay your guys more and maybe folks will rise into the middle-class." the answer is to create conditions where businesses will want to create upward mobility and the kind of middle-class jobs that will make the economy stronger. we have been devastated last two years and we have seen the results of interventionist policy on the government, and it has not been good. >> nick question mark >> -- nick? are inink lanhee

agreement that there are a of policy options we need to consider, but the majority of jobs are low wage service jobs and unless we find ways to bring the wages up, it will not work out. >> great rotation, everyone. -- conversation, everyone. lan chen, thank you force taking -- being with us. ♪

makers."s "market biotech company is making big strides in the hunt for a cancer cure. therapeutics has made its second investment around for a total of $300 million in 12 months, making it the largest early stage health-care funding in years.

dr. jensen, good morning to you. will you tell us how juno's technology works? >> yes, it has been a long sought after goal in cancer therapy to convince the immune system of the body to eradicate cancer in the same way that it protects us from the common cold. technology is one in which a small number of infection-fighting white cells called t cells are isolated from the patient. while they are outside of the body, they are genetically reprogrammed to have in incense -- in a sense an app to go back into the body and hunt down cancer cells and destroy them. >> how successful have the treatments been? you have made a lot of people in never hood capital excited. is it based on results or promise? in the has been decades

making come understanding how the immune system works and using the tools to tweak the immune system. isthe present time, as juno emerging, we are in human clinical trials with the first iteration of this technology. in oncology therapeutics development, you look for a signal that it is having an effect on the cancer. the trials thus far with acute mental blasted leukemia in children sends a subtle symbol -- sell signal. eight out of 10 are going into remission. that is not a subtle signal. >> complete remission after treatment. what made you such a believer in this company? >> my wife and i were lucky

enough to end up funding some of dr. jensen's work at children's hospital. thought, well, surely, there is a company connected to this technology and there was and we made an investment. that company turned into juneau therapeutics -- juno therapeutics. the other scientific cofounders have trials going on all over the country and there are dozens of people who have been treated who are essentially inches from death and were given this treatment. two weeks after getting a fever and a headache walk out with what the call molecularly clear, which is completely cancer free. >> do they have to go back for more treatment? >> thus far, these patients are given a simple the -- a single dose of the therapy and results

are achieved in 10 to 14 days after that treatment. these are early days for these trials so we don't know to what extent the remissions will stick. but some are over a year now and are still in her mission. >> you are part of the medical establishment in addition to being the manitoba center of a start up like juno. the rightompany vehicle to conduct this research as opposed to a university or hospital laboratory environment? the academic research environment in which we go out and try to secure grant funding is incremental in its fiscal support for this work. we have been moving at a snail's pace in essence by having those fiscal restraints. what a company like juno does through its large amount of funding is to be able to

accelerate the trajectory of getting this therapy ready for prime time, that is mass production and having many patients be able to benefit from a revolutionary new form of cancer therapy. >> neck, you are an investor this company. at some point, you will want to make money. how do you do that? socially conscious individual that you are and an investor at the same time, how do you strike the right balance? as we have seen recently with gilead and the debate over the $1000 pill treatment to fight hepatitis c, there is a line that one can cross at which profit becomes excessive process -- excessive profit becomes a little unseemly in the world of health care. you want tovestor, make maximum returns. >> we will see where the pricing for this product ends up. but here's what i can guarantee you. whatever we charge for this therapy will be some de minimis

fraction of what people are currently spending and what the health-care system is currently spending on treating cancer. no matter how much we charge for this transfusion, it's not going to be 10 years in a hospital bed. and multiple bone marrow and radiation therapy. . we misunderstand how economies work by achieving growth to gdp. if juno is successful end of trivets are successful, hundreds juno isons -- if successful and other treatments are successful, hundreds of billions in spending will go away. that thensen, would

the hallmark of success for you, wiping out oncology wards? >> you don't have to say it, mike. [laughter] give you an answer from the pediatric oncologist perspective. children withat cancer today utilizing radiation and chemotherapy, we are not curing all patients and the therapy itself is converting children with cancer into the chronically ill adults of tomorrow. patients need curative therapy that leave the body unharmed and i think this therapeutic platform gives patients hope for that. >> thank you very much for spending time with us this morning. themichael jensen is cofounder of juneau therapeutics. >> they call it they brogrammer culture.

>> i would like you to take a look at the latest issue of louisburg business week. valley,nse of silicon and -- what do you make of the backlash against silicon valley? i think it's understandable because disruption, even positive disruption, is very unsettling to people. people living their lives have a right to expect a little bit of continuity and so on and so forth. create a lotwe do

of value in society but we can be excessively arrogant. >> what justifies the arrogance? what justifies the attitude? you are not emanating that kind of attitude but we know what it's all about. >> i don't think you can ever justify arrogance but it doesn't of same -- >> so why should we forgive it? >> i am not advocating that you forgive the arrogance but i don't think that we will ever be rid of it. because it does take a certain kind of personality to do the things that people in silicon valley do. things thatortant change a society are things that most people disagree with or think are insane. and it takes a certain personality type to be comfortable doing it. most people like to just go along. >> is it also the fact that a lot of these entrepreneurs are in their 20's and probably dropped out of college and our

young kids and at the same time are making all this money? >> yeah, it feeds the ego. that part of the irony, that a lot of these kids have not made that much money but happen to work for people who made a lot of money? >> the attitude is infectious, unfortunately. again, you take a group of young guys -- you are going to have these characteristics. i don't care what group of young guys you grab in general. to stanford and princeton, it will be more than usual because these are pretty --itled and desolate >> pretty entitled. >> is it worse than wall street? >> for different reasons. i am more sympathetic to the silicon valley culture because i think we do do different things. i am in new york city and i

don't want to deride your people but there is something different about making products that transform people's lives and rubbing money together to make more money. there is a difference between those two things. it isn't all about wall street. there are a few companies that create the concept -- [laughter] >> i am not disrespecting it. , whoere are artists, too need all the funding they can get. >> what about those who liken the pursuit or the persecution, as he called it, the number 1%? nutty. is just >> people like you are charged with the same thing. >> in any large group of people there will always be people who don't care about other people

and there will be all sorts of ways to justify their narrow self-interest. and anyone who challenges that narrow self-interest they will azi or position as a n whatever it is. citizens in san francisco have a legitimate concern about skyrocketing rent, about the transformation that is happening in their city. if you don't make $1 million a year, it is getting very difficult to live in that city. >> that happened very quickly. >> it all happened very quickly. the people in silicon valley, if they have any sense -- >> how do we start those inequities? conversationis with your interest in raising the minimum wage and your concerns about inequality. those are inequities, too. and raising the minimum wage ain't going to fix housing in separate cisco. >> at -- in san francisco. >> how we split up the benefits

that capitalism creates is an open question and i think one of the great challenges of our society in the present moment is how to have more capitalism that generates more prosperity and yet find a way to split the value it creates in a way that makes the society grow together, not just a few people get rich and everyone else left behind. and splitting it differently as a mean we will have less capitalism. in fact, more as more people are enabled to participate. people arek silicon there to help make things better but not everything is like that. >> right. there is the arrogance that comes with products that aren't that amazing. >> of course, there is a huge amount of junk that is created, useless, corrosive junk that is created in this process. but all technology is, editorial

monatorial. it is the assembly of other things. sometimes you need that stupid, useless thing to tack onto something and then you have something brilliant. better to make the people in san francisco better first? >> this is why i advocate for rich people paying higher taxes. if you have a higher tax base, you can support a bunch of things that make ordinary people's lives better and that is good for everyone. it's not just good for the people whose lives are being made better. idiot ashley comes back you the plutocrats like me. >> what about the politics of the valley? >we often talk about whether the tea party fits inside the gop, the american phenomenon of the departed -- the tea party not feeling at home. it seems the democratic problem

-- the democratic party has a similar parproblem in california. self-interest and a free market while having something akin to more liberal social values. where does that person belong? >> our politics isn't functioning at a very high level today and partially the reason isn't a is that there spot for a lot of people to fit. you raise a very interesting point and that is a really important challenge. i know a lot of my silicon valley rather in our libertarian and i think libertarianism is nonsense. if there was a shredder chewed to it, there would be a libertarian paradise. >> so you don't want to make silicon valley its own state? >> no. silicon valley people like to talk about making it their own state but who were they sell

their stuff to? go ahead, make your own state and then you can sell snapchat to the 15 people in your state. good luck with that, but he. -- buddy. it is all good having your own world until you need the market that includes everyone else that you don't want to include in your own world. this is the idiotic arrogance of some of these people. it's just stupid. surely you've got a lot to [indiscernible] >> it has changed. when i first heard a talking a lot economic inequality, people startedhen i first talking about economic inequality, people got really angry. that has changed remarkably in the last five years as people, as smart people, smart and thoughtful people have started to grapple with the reality that

this is truly a threat to the country, to the democracy, and ultimately to business. >> does this mean you will run for office? >> no, no. i have a great life. i am not going to mess it up. when it comes to people who are part of the giving pledge, someone with a lot of influence who are giving up for the benefit of others. >> my idea is to change the debate that will lead to policies that will make the country better for everybody. my goal is to change the frame of the debate so that even lonnie will agree that we should tax rich people at a higher rate so that we can fund all the programs that he rightly believes generate prosperity in the long-term. >> wouldn't you have more success if you were able to recruit more rich people to agree with you? >> i would and slowly, by little, it is coming. you would be surprised how many

people actually agree. >> what changed? >> why not start a movement? >> in this day and age, the super pac is the way to go. i don't want a super pac. i want to write books and change the frame of the debate. >> being political without being political. is that possible? >> sure, i think it is. we raise the minimum wage to seattle -- in seattle to $15 an hour. if i told you we were going to do that a year ago, you would have laughed at me and yet here we are. in one year, the minimum wage fight has gone from nothing to now 35 different states and municipalities negating minimum wage. -- litigating minimum wage. redid that by changing the frame of the debate, by reminding people that when workers earn better wages, businesses have more customers and need more workers.

so it is happening and it is changing. >> so great to have you here this hour. thank you so much. >> thanks for having me. it was very brave of you. [laughter] thee is the cohost of venture capital from 2nd avenue partners doing his part to and inequality -- end inequality.

>> that was a really fantastic hour. >> it was a little friday.

>> yeah. hearing someone talk about taxing people at 50% is staggering. >> and a lot of people have different views on the inequality debate, which parts of it they like and which parts of it they don't. it is good to have somebody who has stretched wrong -- such strong views from that position. someone who has hundreds of millions of dollars in wealth as a venture capital investor for years to fix what he perceives is an inequality problem. : 56 pass thet is art which means bloomberg markets -- bloomberg television is on the markets. >> stocks give back their gains this morning as geopolitical tensions overshadowed corporate earnings. l.a.ng me now is james rmb rimelli.

tell us what you are seeing in the options market and which way equities are headed from here. >>. it has been a little bit thin and it has been that way all week. we have seen some choppy price action, especially after we got the news about the situation in ukraine escalating a little bit. the selloff on that news was exacerbated by sell programs. we have a pretty strong open this morning. to me, that is not panic selling. it looks like sell programs. we see a big trade around 16.5, which is not a panic level by any means. show me a vix over 25 and i will tell you we are in a panic mode but we haven't seen that action yet. two stocks in the news today

making a lot of waves in the options market are fox and time warner. -- are who are will betting that we will see a merger will see their bets vanish. what does the hangover trade look like on fox and time warner? >> we see a lot bullish flow and stocks. investors are liking that this deal fell through. i think the consensus was that rupert wanted this deal to get done and that there would be a higher bid coming in. fox also reported a really good quarter. investors really like it. stocks are up another 7% on this report. money calls expire in a day so a lot of traders will lose a lot of money in those. >> yes, but interesting to hear

that there is also a segment out there of options traders betting that murdoch will come back with bet.her back -- higher cbs reports after the bell. what is your strategy on cbs? >> like you said, a very strong stock on earnings. it has rallied six times in the last eight quarters. market makers are implying a move higher by two dollars. everyk the stock can move bit of that, especially since we saw such a strong quarter from fox. i can double my money overnight if the stock gets they pop on earnings and trade above $60. >> how about further out? how are you playing cbs? >> i am still thinking cbs will head higher. it is a week chart at these

levels. on earnings do miss and the stock sells off, i think $57 is a good level for me to come in and get along on the stock again, especially with the big support level and the buzz around media companies right now. >> james, thank you so much for joining us. that optionso hear traders are betting that rupert murdoch my come back with a bigger bid for time warner. that does it for on the markets. "money clip" is up next.

clip" whereo "money we tied together the best stories and video on business news. deals come undone even in a hot market for mergers and acquisitions. the number two in sports gear looks for traction in pursuit of number one nike. around the world, hackers strike and they get away with 1.2 billion passwords. and politics, midterm elections are around the corner but the gop is still at war with itself. porsche