really notice. latest,us with the very we will continue to monitor these headlines as we get them. we will be back on the markets in 30 minutes. ♪ >> bonds, markets bombshell. pimm could he's phil gross leaves the firm he co-founded to join rival janice capital. hundreds of billions of dollars hang in the balance. we'll tell you what's behind the stunning move. >> mason builder. he built up a personal fortune valued at five billion bucks. o'brien wants to rebuild an entire country. >> gender gap on the gridiron. it's the national football league going to win more fans, they are not going to be men.

you're watching "market makers" here on bloomberg television. friday in new york city. i'm eric schatz sker. >> i'm stephanie ruhle. this bill gross news is huge. >> no other way to describe it. an earthquake hit the bond market this morning. the bond king himself, bill gross, is leaving pimco, the money management powerhouse he co-founded which turned him into a billionaire. he's moving to january us in -- janus capital to work for his former colleague. pimco said fundamental differences led to the departure. gross says he wanted to spend more of his time managing client assets. bill powers is a former pimco managing director who has built his own property investing bills since leaving the firm four years ago. he joins us from nantucket. great to have you on the show. glad you could take time out for us from nantucket.

tell us, what seems to make the most sense to you? the idea that there were these fundamental differences between gross and pimco? or this notion that gross is putting out there he simply just wanted to spend more of his time managing client money? >> well, the announcement certainly raises more questions than initially delivers answers. i would have to think that at some point in most manager's investors' careers the idea of spending more time managing money and less time managing the business has to be a nice way to think about your last chapter. bill at 70 is probably younger than most people at 55. so he has a lot of energy. >> a lot left. >> so i would think that probably some of each. >> what do you think about the fact that this could really affect retail investors? right now we are watching the

market get slammed because he's been one of the most active guys in the credit market. what does it mean for retail investors who think bill gross is the bond king, the face of pimco. do you think they could redeem? >> there is tremendous steps that pimco recently saw the new additions of deputy c.i.o.'s, people i' close to, scott, andrew, dan among others and their teams for them this is probably very good news. they will be able to absorb a lot of new responsibilities. and they have a skill set and now they are obviously been pushed to the fore. as they are being pushed to the fore, those behind them will have to -- have the first opportunity to increase their role on the stage as well. what this means to retail investors is really dependent on

what they do with their money. if people watch pimco versus taking money out, there is no reason to believe that the script of pimco will change significantly. pimco has always relied on income, whether in mortgages, primarily, but secondarily in corporate bonds. >> but the deputies need to get public quickly because pimco has been the most long in the credit markets. this is the weakest week we have seen in the high yield market in months. right now it seems like it's getting worse. do they need to get public quickly? and still back the positions they have on? > if you look at the cast of remaining significant stars at pimco, they include many fixed income managers of the year. mark was a fixed income manager of the year. you have a number of others.

i don't see this as a mass exodus from credit and therefore spread widening event. i would not make that conclusion. >> bill, of the names that you mentioned, these deputy d.i.o.'s, six of them i believe -- c.i.o.'s, six of them i believe, who strikes you as the successor if it will come from within. will it be dan or mark or somebody else? >> i would say scott mather. he's been running the grobal group now for -- global group now for close to 10 years and has the greatest experience over the broadest range of fixed income. >> tell us a bit -- >> that's my guess. >> let me interrupt for one second. sanford bernstein analyst said they may get 10% to 30% redemption. i know you said that shouldn't be the case given the bench we have. if we are seeing analysts coming out with views like this, what does pimco need to do today?

>> i think what they do is continue to do -- obviously they have governance issues on the inside the factory of who the new c.i.o. is or -- i hope they don't but they could decide to do a co-c.i.o. arrange. . governance is the first order of the day at pimco. the second is a that they will continue to do what they were doing before after bill leaves. >> bill, tell us about dick. you were at pimco for many years. you worked with him before he left. what's he like and what's his relationship with bill gross? how is it he was able to lure bill from pimco to janus where he is the c.e.o.? >> i worked very closely with dick when i was at pimco. the two of us did two of the most important things that i did in my career. one was broadening the products at pimco by expanding the number of specialty products and fixed

income. not only across sectors of the market, but globally. so dick and i traveled a lot overseas. dick is like his mentor, bill thompson, who is c.e.o., very much like bill thompson. he's very measured. he's a great listener. he's strategic. he has a legal background so he comes from a deep depth. think this is a masterstroke. >> was he getting fired anyway? >> stephanie raises a good question. when pimco says there were fundamental differences between the firm and bill gross, is that just code for the fact that bill gross was going to be on his way ut regardless at some point? >> that's a very good question that you have to write a script when someone departs. this was their script. there can be differences and i

think it shows in bill's choice of what he's doing what he really wanted to do more of and wanted to do less of. >> i want you to stay with us. we have breaking news off this pimco story. take you to our newsroom, our colleague betty liu has been on the phones. >> that's right, guys. i have been talking to some people very close to pimco, very senior folks close to pimco. this is what i have for you right now. they said the reason why that bill gross left the company is that essentially some very senior people within pimco were getting increasingly frustrated at bill gross' behavior. his erratic behavior at the firm and they threatened to quit. they threatened to walk out if bill gross didn't go. essentially bill gross was being pressured to leave the company. they also said the fact that janus put out the press release earlier that pimco showed this

was a complete surprise move that bill gross wanted to control the narrative. he wanted to leave the firm guns ablazing. he went to janus first and made this move which caught pimco by surprise. that's why you saw the press releases afterwards. the other thing i want to tell you about is muhammad aryan. there is speculation perhaps maybe he might come back to the firm. well, he is not interested. this is not coming from -- this is all coming from senior people within pimco, essentially he is going to stay and do what he's happy doing, which is spendling time with his family. he's working half of his time, but not directly at pimco. he essentially has been advising them on global economic issues. his name will not be one of those that will be announced in the next few hours as an executive coming back at pimco. it will be others who will take over from bill gross. you can kratch muhammad el-erian's name off the list now

as running back to pimco. >> the amazing thing we are seeing in the markets right now is the fact, remember, the fixed income markets, credit markets, are thin at a time like this. bill gross the largest seller of those markets, their positions are getting buried right now. people have figured i.g. is one of the biggest positions, brazil, insurance companies. they are betting against them thinking even if they don't have to redeem they may have to flatten out their positions. >> anticipating an unwind. bill, here's a very -- a question for you. this is the second big name manager to leave the firm he was for so many years associated with. i'm thinking of jeff begunlock leaving t.c.w. to found doubleline. he has managed in a fairly short space of time to build up more than $50 billion of assets at doubleline. now that gross is at janus, a much bigger firm already. how quickly do you think he can gather assets? >> i think bill could very

easily and will accumulate assets. my starting point is as we came out of the deep recession pimco had under a trillion in assets. very quickly as their track record, their team, and the flight to quality of assets moved pimco to double that, to two trillion. which was astonishing growth in a very short period of time. what little money has left pimco under the current rancor, if there is another $50 billion that leaves out of the $1 trillion of new assets that pimco got post-2009, $50 billion is a lot to a company like janus. $50 billion is a small percentage to pimco's assets. >> fair point. bill, great to have you this morning. thank you for taking time out for us. you're in nantucket on personal time and we appreciate it. bill powers is the former managing director at pimco. left the firm four years ago to

start his own real estate investing company. dick, the man who hired him at janus capital. >> obviously people are saying it was his time. he wasn't making the best investment decisions. right now it appears the credit markets are frozen. you are only seeing the indices trade. remember the week we just had. remember how the market performed in the last four days. this is horrible timing if you're a guy running a portfolio at pimco right now. >> sure. >> you're going to get a promotion. >> lots of people not trading today. for further reasons. >> there you go. tough day in the market. >> an amazing development. bill gross, the bond king, leaving pimco joining janus capital to be with his former colleague, dick. enormous complications. ♪

>> welcome back to "market makers," i'm stephanie ruhle. few members in congress are as polarizing as our next guest. minnesota republican michele bachmann. she ran for president back in 2012. first elected in 2006. and is not seeking re-election. congresswoman bachmann is standing by in washington with our own peter cook. >> thanks so much. i'm joined by congresswoman bachmann. thanks for the time. want to start first ask you about your departure from congress in a moment. want to start first with current invents. you're a member of the intel committee. pretty outspoken. you're pritsism of president obama and taking on the islamic state. what is your reaction to his plan. you would like to see american boots on the ground? >> i don't criticize president obama taking on the islamic state. i wish he would take them on earlier. sitting on the intelligence committee we knew about the lamic state, we knew and presumably the president did.

a lot of this jihadist tempo was up-tempo for the last year, year and a half. we knew it was coming. that's why it was patently obvious the last thing the president should have done is pull u.s. residual forces out of iraq. they were there for one purpose. maintain the peace. now we see the lack of wisdom. >> the decision the iraqis made -- >> we were the economy. we were the backbone. for us to put nearly $1 trillion into iraq and leave, we don't even have rights to an air base, we had a lot more leverage than the president was willing to use. >> what about the policy going forward? you have said, listen, the president's strategy at this point is inadequate. you called for congress declaring war on the islamic state. you are talking about american boots on the ground. you think that would be the preferred option here? >> the preferred option is to defeat the islamic state as quickly and decisively as possible. that's why i think the president's strategy is not the right strategy because it's a dribs and drabs vietnam

war-style strategy. that didn't work well in vietnam. i believe we need to engage in a world war ii-type strategy wherein we get serious about this issue. we have the finest military in the world. why wouldn't we use it? instead when we are doing is proactively -- >> a fellow member of congress -- >> and putting a gun in their arms and thinking somehow they are going to defeat a very large, very senior trained islamic army? it's going to be very difficult to do. that's why i don't want to see us goofing around and wasting very valuable time. >> you know some of your fellow republicans in congress very leary and opposed to the idea of putting u.s. boots on the ground. the cautionary tale for them is the iraq war. they don't want to put americans in another sectarian conflict. >> we are already doing air strikes with american resources. the way the war's progressing now, because it is a war, the way it's progressing, eventually

the united states will have to come in. even the white house admitted that over the weekend. the white house senior advisor said, yes, we may have to go in in the future. but if we do, we won't go in with a combat mission. and our troops will only be able to fire if they are fired upon. well, that doesn't sound like a winning strategy. no combat strategy. and not being able to fire first. you have to wait until you're fired upon. that's never going to defeat the islamic state. i think we need to have a realistic view and we need to take them as serious as they are and defeat them and defeat them early when they are at their weakest. >> switch to politics. you are set to leave congress. you will be speaking to the value voters summit here in washington later today. are you going to shock the world and announce you're running for president again? >> no, i will not. i was very grateful for the opportunity and privilege i had to run in 2012. i intend to be very involved in the election, but perhaps from a media point of view. >> do you have a candidate in

mind right now? >> i will by the time 2016 comes around. we have a plethora of riches. we have great candidates that are expressing interest. obviously no one has declared. by my count there's about 16 so far that have expressed very serious interest. that field will probably winnow a bit as the months go by. it's quite a task to put together a presidential effort. i think we'll have a very good candidate on the g.o.p. side. >> do you think mitt romney should run again? >> mitt romney is a great candidate and he may be the candidate if he chooses to run. but we'll see. >> let me ask you finally about congress. you are departing. speaker boehner, do you think speaker boehner continues on as speaker of the house in the next congress? will his fellow republicans elect him speaker? >> i don't know. i'm not sure he will. he may stay on and do what former speaker denny hastert did and resign after the election. i don't know. it will be up to the speaker to make that choice. but i think, again, people are

looking for a bold, fresh vision and whether they want to give that mantle to john boehner or another member of the house. we'll have to see. >> if you were there would you vote for him? >> i have to see at the time. i have to see what his vision is. what he's planning to do, and who the other candidates are. >> congresswoman bachmann, thanks very much. your final weeks in congress. appreciate you joining us here in bloomberg. stephanie back to you. >> thank you so much our own peter cook and congresswoman michele bachmann. bloomberg politics is coming to bloomberg tv. with all due respect is coming on october 6 just in time to cover the final weeks before the midterm elections. >> coming up here on "market makers," stocks bouncing back after the big selloff, multiday selloff yesterday. the worst for u.s. equities in two months. ♪

>> we are back. you're watching "market makers." i'm stephanie ruhle. we are approaching 26 past the hour. time for bloomberg to take you "on the markets." we have got to talk for a minute about janus and pimco. >> have a look at the price action. janus capital hiring bill gross away from pimco. the stock trading up 33%. the expectation here, clearly, stephanie, that bill gross at janus will be able to attract so much more in the way of fixed income assets than janus has ever had. $177 billion in assets under management. bill gross himself in the total return bond fund managed $220 billion. >> janus has always been legit. when you're thinking about fixed income market, who are the real money players? black rock, pimco. fidelity. those are the guys right now who could get hurt because they have the real money.

it's henning funds that have been smoked in the last few months. in the next two days is when everyone will be in a complete panic because these guys have to mark their books. if you are on the market going this week and watching the credit markets widen out. i'm hearing dealers, have more inventory today than they have had in over three years. the goldmans, morgan stanleys of the world were under pressure to sell in their positions. tough at this day -- tough day to do this. elian didn't talk about el- owns pimco and they are pricing in exactly the same thing. not just the possibility that janus capital will accumulate fixed income assets, but those stampede out of pimco where bill gross has played such an instrumental role. >> bill gross is the face of the income markets. whether you like his performance or not, retail investors connect

fixed income markets to bill gross. >> on the move. that's that on pimco and ilianz right now. back in two minutes. ♪.

>> you're watching "market makers" on this busy friday morning. i'm eric schatz kerr. >> i'm stephanie ruhle. get to the market. it appears to be rebounding after global anxiety broiled markets earlier this week. yesterday was the worst day for u.s. stocks in over two months. the question was this morning is the worst over? with us from boston, david kelly. chief global strategist and head of the global market insight strategy team for j.p. morgan funds. david, let's start with what's got you the most focused, most excited this morning?

there's so much news asecretarying the tsh-affecting the markets? >> i think the u.s. economic numbers are important. we saw an upward position to g.d.p. growth. everything we are looking at suggests we are going to have about 3% growth or more for the third quarter. finally after years really disappointing economic recovery, there are signs that the u.s. rehe covery is gathering a lot of steam here. >> if the u.s. recovery is gathering a lot of steam, david, what's been going on these past few days with stocks selling off as hard as they have? >> well, it's very hard to rationalize the day-to-day. i think it's -- to say there's global tensions increased yesterday that caused a big selloff is silly. we have been dealing with the same issues for the last few months. the market just doesn't go in one direction. occasionally there's some pressure to have a selloff or start of a correction. what's happening is every time one of these corrections gets going, it can only go so far before people say i better it

in. >> you raise an excellent point. we built a chart specifically to illustrate it the idea that there have been three selloffs, three previous selloffs this year. one of them earlier in the year was almost a 6% selloff. then we had two that were roughly 4% selloffs. right now as of the end of yesterday's trading we were only at 2 1/4. nowhere near where we were before. what was it those three past times and presumably this time as well that gets to investors? this notion that perhaps valuations are a little too stretched which is why you almost always see techs or biotext or social media stocks leading those selloffs? >> i think within the market there are things that are cheap and there are things that are expensive. i think it's a crowd mentality by which from time to time you see there's this urge -- all good news is priced into the market. i don't think there have been any big items of bad news to

force the market down. i think the market's becoming less sensitive to bad news. back in 2009, 2010, i remember, what's the next shoe to drop and the market will fall in huge ways when people got scared. now after years of the market crying wolf, we only get these very small corrections. i think that's where we are. right now the focus is still "on the economy" improving and that will put upward pressure and interest rates over time and that really makes it hard to keep money away from the equity markets. >> where are you most bullish specifically? >> in the short run i'm pretty positive on the u.s., but for a long term investor i would be upping my investments in both europe and emerging markets. europe because i think europe is engaging in long-term economic recovery here. i don't think it's going to falter. i think it's going to continue. and as it does i think you'll see a big jump in european earnings over the next few years. then in emerging markets, they have not been popular recently.

they are selling rather cheap. and the key point is the u.s. -- this is an indian summer of u.s. economic growth. we think next week the unemployment rate could be reported 6.0%. that's below six-year average. within almost half a percent of the fed's view of full miami employment. we are running out of capacity for fast growth in u.s. economy. we'll get a year or two. but that's about it. a lot more room for long-term growth in europe and the emerging markets. that's where some of the investment opportunities lie also. >> how long term are you thinking there, david? there are lots of people who look at europe and say, it's going to be a mess for several more years. tony james, the president of blackstone was on with us earlier this week saying he can't see our rop exiting its current malaise for three years. is that what you're thinking when you say long term? >> no. i think markets will to better within that period of time. europe is populated by

policymakers. i think that by the end of this year the e.c.b. will be done with its quality review. we are done with the debt cry sifments we are done with austerity and unemployment is beginning to come down in europe. 2015 will be a brighter year for europe. over timeure peaian investors will feel better. the time to get in is not when everyone feels great it's when they feel badly. i think they are underpriced because people don't realize the economy will recover if policymakers don't make a mistake. >> even if europe is still policymakers, if if they send out the message we'll do whatever it takes, isn't that the massive safety net that makes everyone want to be in the market? >> no, it's not. the curse by policymakers, the european economy will recover by itself. that's what people don't understand. it's only in the last 10 years or so that people around the world have got convinced you

need the government, central banks to fix the economy. economies fix themselves. you got 11 1/2% unemployment, there are people who want to work. people want to grow business, buy more stuff. an economy left alone will gradually heal itself. i think policymakers would be more calls for problem in europe than the solution. the unemployment rate is coming down. if the e.c.b. give the banks a thumbs up to lend at the end of this year, you'll see stronger growth in 2015. >> stronger growth in 2015. david, so much of what underlies the valuations in u.s. markets is the expectation that the economy will continue growing quicker. you pointed out that .6% g.d.p. number we saw earlier. a lot of it has to do with margins as well. do you think profit margin can be kept at current levels? is it possible they might even be expanded from here? they are a historic high. >> i think they'll probably be

steady for the next year or two. it really has been about profit margins so far in this expansion. we see an extraordinary surge in profits over the last five years. mostly through margins. i think going forward over the next year, particularly as we go into 2016, there will be increasing pressure from rising interest rates, rising wages. i think you'll still have enough opline g.d.p. growth to keep margins steady. the big margin expansion is behind us. earnings growth will be ok. confidence will move up. multiples will move. they are high right now. they are just as average. i think they'll move up. i do recognize that over the next year or two the u.s. is running out of room for fast growth. that's why people have to have an international perspective as well as a u.s. one. >> david, thank you so much for sharing your insights this morning. david kelly, chief global strategist at j.p. morgan funds. >> when we come back, irish billionaire dennis o'brien. why he's spending so much of his

time in haiti. ♪

>> welcome back to "market makers," i'm stephanie ruhle. i can't believe i just said that. focus on news today. he put cell phone towers across much of the developing world. now irish billionaire dennis o'brien is focusing even more attention on one of those countries. he wants to help haiti attract investment and nudge the country towards democracy. i sought down with him earlier this week and asked, why haiti? >> i think all the building blocks that haiti needs are now in place. more than -- the economy is 75% of their budget on education, up from 2%. the they are attracting more and more foreign direct investment. and the biggest issues for haiti is investment and attracting jobs because unemployment is

around 40%, 45%. so the challenge for haiti is in a very globalized world, how they attract investments into the country. the economy is growing at about 4 1/2%. there is growth. so there's a lot of good things happening in haiti that needs an extra spurt. >> why haiti for you? puerto rico is in in need of investment. virgin islands have positive tax incentives. why haiti? >> the 10 million people living in haiti, they had a bad government up until recreptly since they got their independence. i think in 1840. they were the first of the countries to lift that. haiti has met its time in history. it has a good government. it hat challenges in terms of the parliament because there's a lot of blocking and maneuvering within the parliament because a lot will see they will lose their seats in the new haiti. legislation is slowly grinding its way. there's about 50 bills waiting

to be passed. it looks as if the government in january will probably rule on the decree and have an election in february. >> you put cell towers hot just in haiti bus basically across the entire third world or developing world. is there a true economic case that once these countries have wifi, cell service, it's an economic game changer for them? >> completely. if you don't have broadband going into a country, submarine cable going into a contry, then you have no access to modern telecommunications. it's the fundamental of any economy. if you want to attract foreign direct investment, you need keckivity and -- connectivity and reliable i.c.t. provider otherwise it won't happen. haiti has that. jamaica has it. a lot of these countries now are seeing that this is going to stimulate growth. >> people who criticize the likes of google or facebook for trying to help the developing world get the internet, we shouldn't be criticizing them

because it's good for these countries? >> i think that would be stretching it on those two. they build some infrastructure in the developed world. they are trying to do so in africa. in reality it's down to the telecommunications operators in all of those countries to roll out broad bands. the problem with those guys, google, facebook, all these people, they are having a party in our house. >> what do you mean? >> effectively they are not giving us any revenue share for us to connect with the customers. we pay all the networking. a we being whom? >> teleco operators. they are having a fantastic party but not bringing any drinks or food to the party. >> how do you stop that? >> i think it's going to happen very quickly. i think there is a big move in talking to teleco's around the world today, they said we have had enough. they have had loads of conversations with google and facebook about paying their way.

broadband and network, by paying some sort of revenue share. and they just are -- more and more we are all getting together to say enough is enough. >> is that the case? when i look at apple, people just continue to buy into them. even though they are terrible to their partners. they are terrible to any industry that they partner with. it always seems like apple wins. is that ever going to change? >> we have seen in the airline industry that model changed dramatically in europe where getting your two fingers to your customer is not a great idea. not a business strategy. apple will hit that point and it's going to happen quickly. >> when? i'm seeing people lined up around the block to get the new iphone. >> technology is moving so quickly, stephanie, there will be somebody else coming up with a better product for apple. that's always the risk for any company that's the market leader. nobody will be ruling the roost forever. some may be a little bit more

humbleness would probably come along with a greater product. >> does blackberry have any life left in it? >> i still like blackberry. >> me, too. >> the technology is great. they need to go to android. they are a very -- at the enterprise level they are great. they need to make a phone that's cheaper. somewhere around $100. even countries like venezuela, blackberry is huge. even some of our markets, trinidad, prepaid blackberry is a huge part of our business. we are all willing them on to come out with a broad that's going to be needed to go to the next level. they need to take their security protocols and system and layer it on to android. that's where the future is. >> what do you say to the u.s. government and all these companies who are looking at these tax inverse plans. leaving the u.s. who want to take advantage of better taxes abroad. you are a man who built his business around the world. you spend your life on a plane.

what's the right thing to do? >> i think there are certain abuses -- abusive things going on. like the double dip and things like that. at the end of the day the world is globalized. everybody talks about globalization. we have climbed up to it. we are living the mantra. taxes should be a part of that. you cannot stop a u.s. company going to canada and registering there. you can't stop an irish company going to bermuda or wherever. that's the way of the world. the germans are a little iffy about it it. >> that was denis o'brien, founder, chairman, and c.e.o. of digicell. >> why the nfl can't fumble its legal issues. women will be the driving force in its audience growth. ♪

>> welcomeback to "market makers," i'm stephanie ruhle. the future of the until depends how well it can raise its game

with women. females are the fastest growing fan demographic for the league. here to talk more about how important it is for the nfl to court the ladies is eric shemmy, he also knows a bit about courting ladies. eric, give us the story. >> i don't know what to do with that intro. if you look at the data -- >> we control it. >> the growth rates of women watching nfl versus men watching nfl by far favor women. if you look at the last five years, growth rate for women, 26% compared to only 18% for men. they are the driving force. >> are these warped numbers? the market is already saturated with men. what men would you go after you didn't have? >> every man who wants to be a football fan is is man. the ratio in terms of tv audiences is two to one. it's definitely the women are growing share. 3430% a few years ago.

now 36%. they are taking away share from the men audience. >> that's because why? we have to acknowledge the male audience is bigger so it's easier to grow. >> they are saturated. >> what is saturation? are there truly as many male nfl fans in america and elsewhere as there are ever going to be on a percentage basis? >> if you're not already a fan from that point. the numbers show it. >> i know you're never going -- >> hang on a second you came here to peddle conventionle wisdom? >> i'm trying to connect with you on a place that's not data driven. the data supports that conventional wisdom. that's what all these issues in the last few weeks are a big deal. >> because men don't care if football players beat women, only women care? >> in terms of the public relations. >> hold on, one more time. let's get this straight one more time. let's say we are both potential football fans. it's going to upset me more if a

player beats his wife? it's going to affect me about whether i like football as a player -- if a player punches his life in the face than erik? >> equally poorly. equally badly. it's not good for anybody. if you look at the strong surge -- if the growth is coming from women so the sponsors from the corporate level in terms of who they are trying to reach down graphicwise they have to be sensitive to that. you think what procter&gamble has done in terms of not putting their on-field sponsorship in play. >> does football need to grow? it seems like it's a massive market. a multibillion dollar industry. couldn't we say, hey, we have this locked? >> roger goodell said he wants to triple the league's revenues in the next 15 years. they are trying to grow. they are greedy people. they want to go to 18 games. >> that's the word. >> there you go. greedy. >> they'll take the money wherever they can get it. last year it was the women audience that went up by 2%.

the male audience dropped by 3%. the nfl viewership would have gone from 2012 to 2013 if not for women. >> why is the nfl losing male fans? >> "monday night football" has been going down in terms of a prime time broadcast. the sunday night games, thursday night games, those are all growing. but the monday night is the place of weakness. it's a prime time weak night audience not the weekend viewership demographic. >> do we know a demographic within women? what's pushing women start liking football? fantasy football. >> engagement is way up. if you look at the difference from 2012 to 2013, you are looking at an extra 600,000 women playing fantasy football. >> there's a much higher chance i'm going to join a fantasy football league than sit home by myself on monday night. >> if you join the league, this then you'll be more likely to watch because you are minimum waging that money on the line. >> are female fans graph tating

toward any particular teams -- gravitating toward any particular teams? >> i don't have that data particularly. i'm sure it's probably -- >> what would you guess? >> you're a redskins fan. >> i'm related to a redskins fan. i don't have a choice. i would guess dallas cowboys, new york giants. >> the basic stuff. >> yeah, the basic stuff. i'm guessing there's not that many women dying to go to green bay. there you go. thanks so much for coming on. >> what? >> she called you chummy. >> thank you, steph for having me. >> you know what? someone is sending me a boomberg message right now. why? it's my 30th birthday. i blew it when the giants were in a playoff game. i didn't know it was a problem. now i know. i'm not coming. the giants are playing. guess what? i didn't want you to come if you were watching the giants. thank you so much. speaking of birthdays, do you

know today is my third anniversary of bloomberg. >> congrats. that's worth celebrating. >> pretty good. there you go. >> you're still here. >> still here. it's approaching. 56 past the hour. >> we'll look at blackberry, everybody. blackberry reported its smaller than expected loss. it's the analysts doing the expecting. two krentz a share in the most recent fiscal quarter. -- two cents a share in the most recent fiscal quarter. shares came in lower than the anticipated level. that doesn't seem to be causing any concern among the blackberry faithful. stock is up 7.3% today. the passport, that new blackberry we were showing you on wednesday, it's the size of a passport, it's got a square screen, is already sold out. not because blackberry expected to sell 10 million like the iphone six, but because they had 200,000 in the pipeline and they are already spoken for. good news for blackberry. >> even better, it wasn't a

giants game, it was a.f.c. championships and the jets. i can't get anything right.

>> live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle. >> bill gross rocks the bond market. januss cofounder heads to capital. who will manage the $220 billion fund that he ran? >> tangled up over taxes. rules keeping companies from moving overseas to lower their tax bills. is there a better way to do it? we put the question to former white house budget chief. -- if yourbudget

bucket list involves travel, we have the man to see. welcome to "market makers," i'm stephanie ruhle. >> i am erik schatzker. 11:00 on friday in new york city. >> in newport beach, we heard stories about rising tensions at pimco. no one was speculating it would end like this. the man known as the bond king has quit the firm he cofounded and signed on with a rival. for almost three decades, bill gross has run the world's biggest's bond fund, pimco total return fund has more than 220 billion dollars in assets. he will be running a fund at janus capital. many are wondering how much of the pimco money will follow him. with us, an all-star cast. sheila, tom keene, and they live. a cover story on pimco. you spoke to bill's wife. >> when he and i spoke a few

months ago, it was obvious that he was deeply unhappy. he had been incredibly successful as an investor but that success brought all sorts of new management problems. his firm got so big and unwieldy he needed a lot of help to run .t he is sort of an introvert. he likes to look out bond prices. he does not like to go around making sure everyone is happy and doing hiring decisions, hr. >> he doesn't like to travel much. does not like to surround himself with a lot of people. routine.a man of he eats special k with blueberry every morning. >> stephanie raised a question -- >> he has a cat. >> how much money will follow bill gross to janus? i did some math. i know that that scares you. >> canadian math. >> until yesterday, shares of

janus were trading at about one point 75% of janus' assets under management. they have a new market cap today, stock is up 35%. if you do a little math, you come to the conclusion that the market is implying, using the same multiple that janus will have 200 $35 billion of assets under management. making bill gross a $60 billion man. that is a legitimate calculation. he's a marquee name. many people have said that. this is a true rock star. he cane tough years but bring in new money. moving money is a fascinating question. a number of interviews make clear that retail could move. >> if he is the bond king and the expert, wyatt leave and go to janus?

why not start his own fund and go hedge fund style? collect 2 and 20. that is abond market tougher proposition than in the equity market. >> why? there's a ton of credit hedge funds. >> bill gross works in the full faith and credit market. it is a different bracket. is, he where sheila wants a smaller -- >> i disagree. he's the biggest player in the credit market. he could start a credit hedge fund. >> i want to chime in here. first, why janus? it is a chief rival to pimco. there is a relationship between wyle and bill gross, he was the coo of pimco. this is a classic bill gross move. this guy is not interested in and quietly going away.

he had something to pro. he was being pressured to leave pimco. his behavior was getting worse. >> there's a question as to why janus? rival tortainly a pimco, has been something of a pathetic rival. pimco manages almost $2 trillion in assets. janus, historically a growth equity business, manages $177 billion. 10% of the assets. >> go back to july of this year, janus announced they were taking the nobel laureate. that is people that bill gross likes to be around. it is not a small idea. i was one day at pimco and michael spence walked through the hallway. pimco is structured like an intellectual hothouse. they really value the exchange of ideas. that is something that bill gross loves. there's been some turmoil in recent months. there are folks there who have

reported to bloomberg and other outlets that he was not necessarily dealing with contradictory points of view very well. all the turmoil made it into the press. >> that's a nice way of putting it. this morning, there was a scathing note about bill gross. he is 70, he is down the road, all reports are that it has been an immense challenge to run .imco ft to mohamedes el-erian, mohamed el-erian left-hander is no indication he is coming back. >> mohamed el-erian's job, what was bill's job? >> bill gross wanted to run the fund and manage. he was the thought leader at pimco.

not that mohamed el-erian was not, he was out there in the press like an ambassador for pimco. he also ran the operations. >> as we all know, bill gross is not an operator. he's not a ceo. >> we have a piece of breaking news for this conversation. sources, bloomberg sources, are telling us that dan iversen, one of the deputy chief investment officers appointed with el-erian is likely to succeed bill gross. that will not surprise to many people. . the not appears to be going to daniel ivascyn. >> do you know him? >> i've met with him. he's very impressive, very well-regarded. promote ahey did he

number of people into the chief investment officer role and they were taking steps to plan for the moment when bill gross stepped away, daniel's name was always at the forefront. a huge job ahead of him. we talked about the possibility that retail money will exit pimco's total return fund. the retail investors can do -- so much ofions pimco's money is institutional and not in the total return fund -- is subject to review. every institutional manager has to initiate an asset allocation review and decide whether to keep the money in pimco. ivascyn is going to be the man of the front lines trying to keep the money from walking out the door. we've seen this before. at putnam when it blew up. guardianfunds capital

trust in los angeles, when mr. lovelace moved on. there's a hierarchy shift. ivascyn is the kind of person -- that is what he gets paid for. cats.he get everyone in order while hiring intellectual firepower. that is what mohamed el-erian did. involvedd el-erian was in investing. he would come in ungodly early, do his market analysis, write whatever op-ed's and then sit on the trading floor until 9:00 a.m.. at 9:00, he would move to the executive suite and do management duty. not was the part bill did like. >> this is the second enormous job opportunity in today's that has come up where mohamed el-erian was a potential candidate, running the harvard management company, which he was dead. it was thought he might return. now pimco, which he once ran.

>> maybe he does not want to do any of those because he loves being a bloomberg view columnist. happy with what he is doing right now. workings half his time on other things. he's happy to be doing the things that he said he wanted to do, spending time with his family. >> in london, the article on his 10-year-old daughter. the idea that this was about his family. we all know the crushing hours. you look at stephanie ruhle's 35 hour workweek. working 35 hours a day. >> he wrote this article for "worth" magazine speaking about his work-life balance. now in europe, the telegraph and guardian have picked it up.

he's now trending in europe. as this beacon of work-life balance. >> sheila, i have a question. claim -- i've had the privilege of being in their morning meetings. el-erian note,, there. >> there were complaints that or mohammed or not there, it would have a chilling effect. afraid toould be speak their mind. like they werelt too authoritative end of the power balance was not fostering the kind of intellectual -- en, a fixeditz income manager, today said bill gross had a call on macroeconomics that folded over to the sweat of trying to make alpha. he brought the economics world

right into finance. that always is contentious. always. >> you know it is not contentious? this conversation. >> he said did i not get the memo about blue? he is wearing blue. you are wearing blue. i love you, tom keene. thank you so much. >> this is derek jeter blue. excuse me, toronto maple leafs blue. >> better. >> thank you. great conversation. why is it great to work at bloomberg? people know what they are talking about. ♪ house beould the white having second thoughts about new rules on tax inversions? we put the question to president obama's former budget chief peter orszag. ♪

>> this is "market makers." i am erik schatzker with stephanie ruhle. on paper, it sounded like a crackdown. the treasury department's new rules aimed at stopping u.s. companies from moving overseas to lower their taxes. companies including pfizer and burger king do not appear to be deterred. burger king is going ahead with its deal with canada's tim hortons. the rules have not stopped pfizer if it wants to pursue an inversion. let's bring in president obama's former budget sheet, peter orszag. good morning. we have a lot to talk about. do with corporate

taxes. inversions would be a good place to begin. presumably, you gave this some thought when you are the budgets chafe under president obama a few years ago. carl levin had a bill that would claim to recover lost corporate tax revenue if it would be apply retroactively. is that credible? >> you started with legislation -- it is hard to tackle this problem without legislation. the limits of the idea that willess is polarized so we do things administratively or through regulation, we're seeing the limits of that. you can only do so much without legislation. jackat being the case, did lew take the right approach? both he and the president have spoken out against inversion. they talked about it being

unpatriotic and felt he had to take action. from where you sit, did those new rules make sense? need to use inflammatory rhetoric. they tackle part of the problem you definedt -- if problem as the incentive to invert -- they only attack a modest part. they do not do some of the things that have been proposed. there was a harvard law professor who proposed they do things through regulations that would be more front and center in attacking inversions. i think the reason they did not do that is because they did not feel like they have legal standing. even these rules, this is a notice. they will go through a comment period, you have to make sure you are not exceeding your 30. they tried to walk the line of what they could do. >> are they doing it for

political popularity? if you do not have congressional action, what is the point of saying anything? >> this does not have no effect. this will have some effect. ofyou believe that a flurry inversions is not a healthy development and you want to clamp down, you do what you can. >> peter, legislation would be a much better way to address this problem. i know you have given thought -- >> 0.000 probability. >> of tax reform. in the next two years? before the next general election? >> i'm a skeptic that we will see any significant corporate 2017 andm hbefore administrationew

could get corporate tax reform done if they prioritize it at the top of the list of the various agenda items. that is not guaranteed. it is very easy. it is always popular to say we should do corporate tax reform. pie.sounds like apple the problem is that the effective tax rates vary from one corporation to another. when you try to broaden the base, you are taking away a tax break that is benefiting some corporation. it got there because there was political power behind it. have taxe not going to reform before the next election, what makes you think you're going to have it after the election? things are going to be just as difficult. a difference, a new administration has what colin powell has turned the tractor pull part. the tractor is accelerating and the mud is flying before the mud settles, the honeymoon

period. was in the top two or three items, it could get done in 2017. either party is going to have promised tons of things. when you go through the transition process for the incoming administration, they will have to prioritize this is as everything else. i do not know that this comes to the top of the list. inversionsthe reason have traction for the democratic party and even some republicans, they feed into the notion that america is becoming a more unfair place. certain parts of society, whether it be people who have accumulated wealth or corporations that are not doing their part for the rest of the country. you tackled this issue in "bloomberg view" any way that i found provocative. wee of the inequality perceive in american society has

to do with the kinds of companies that have been born in america and the kinds of companies that are currently flourishing in america. could you explain? >> this is it that surprising. i think our sense of inequality is within a firm, people are getting page automatically aid dramatically different wages than 20 or 30 years ago. 90% ofere between 2/3 and the rise in earnings inequality is not within a firm. average pay across firms is becoming much less equal and much more unequal. oft explains the vast bulk the rise in earnings inequality. at the same time, we've had a very disturbing and surprising decline in labor market dynamism. the share of people who move across state boundaries is declining. this has been happening for two or three decades. gross job creation and job destruction rates are down. despite what the rhetoric

suggests, people are moving jobs less frequently than two or three decades ago. these two things might be related. once you find yourself in a high-paying firm, you do not leave and that precludes other people from joining the high-paying firm. thateates a labor market is one of the biggest issues we face. the lack of dynamism, not only in the labor markets but in terms of new from creation is a problem. >> if we address this, what it?ld be done to combat >> the question is what is driving it. there are a variety of things. some of which have to do with technology and are beyond policy. addressable. the share of workers in the u.s. who require a license in order to perform their jobs is up substantially over the last two decades to three decades and it does not make any sense in many

cases. that kind of regulatory environment is create frictions in the labor market that can create these sorts of problems. the danger that the u.s., that the labor market mobility that america has always been famous for will erode. i'm not sure what verb to choose. so that we will end up where australia is our candidate is. eu. worse, -- or worse, the abilitye amount of our to respond to economic shock and to generaten ounce -- productivity comes from having a flexible labor market. if something bad happens in one part of the economy, we can shift people and resources to other parts. if we lose that, we will lose one of the significant engines of economic growth in this country. i way of putting it. there is less churning under the

surface, the topline growth number ultimately is going to be lower. >> yesterday we sat down with david stockman. should wipe out corporate income tax, cut payroll tax and add consumption tax. >> a wealth tax. david has -- >>. you were watching >> lots of testing ideas that he put forward his most recent book. it is academic to be debating those kinds of proposalsl bringing us back to the political system. none of that is going to happen. we have to come back to what can we get done. just to say we should not do x and have no prospect for doing it -- >> you still care deeply about this. what do you think is possible? what do you think the next congress might accomplish? >> i think the next congress, we're going to be talking about very small things.

small fixes here and there. i wish that were not the case. i cannot say a very high probability of any significant legislation despite the need for immigration reform, tax reform, all the other things that we've been talking about. i am hopeful that we can make some progress on things like reinforcing the fabulous trend we have been experiencing with medicare costs. with small additional reinforcements to move the medicare system away from fee-for-service payment. >> thank you so much, peter orszag, formerly president obama's budget chief and now at citigroup. >> quite a week on "market makers." do you catch our interview with eric schmidt or david stockman? that and a lot more, when we come back. >> time to play the europe again. look at this man. an apparel executive. graduated from cleveland high school in oregon in 1955. us figureu to help

out the answer. tweet us. >> i don't know. i need help. >> no. ♪

>> it has been an extraordinary week. >> let's begin with the extraordinary news of today. bill gross left pimco. he is going to work for his old colleague. pimco is the firm with management built by bill gross.

he was among the cofounders. he managed the fund. he is now going to manage an unconstrained bond fund that does not really exist yet. it is in its infancy. the big question is how much money. this is the fundamental question , how much money is he going to take with him. stork --he reason the stock is storing today. when we spoke to bill powers earlier, he said there is an extraordinary lineup of talent in-house. bloomberg is reporting that he is likely to be the successor to bill gross. we are expecting an official announced that in the next few hours. the bench is huge. the issue is going to be what is

the perception? especially from retail investors. will there dollars follow? >> part of the problem is back in january, there was a high profile falling out. point, they had both been a public spokespeople for pimco. since then, bill gross has been the sole spokesman. not in a way -- >> nobody has been out there the way that bill gross has been out there. an unknown. that is an important consideration for a firm where so much of its asset comes down to perception. >> we spoke to some other major people who are proud to get out there. some of them are who? and --e to leon coburn

cooperman. >> people cannot dismiss the significance of zero short-term interest rates and 2.5% tenure governments. it is telling you the returns and equity going forward are going to be modest more than they have been historically. bonds are up five to 6%. that ift keep making the interest rates are going to be zero. picker. a stock you no longer have the opportunity just go long in the market. the guys performance says he is doing something right. talking about is low interest rates. that has been vexing bill gross. he has had some not so great years, including this year where he is in the 44th percentile.

that is something that used to be 97 or 98 or 99, he was the top fund manager in the world. he can't find his way in the world. the former ceo of google. he was talking about his new book. book was the most important. as fiercepetition is as it ever was before? us into eric schmidt. brutal competition has an arm its benefits for consumers worldwide. when you look at the innovation, that competition which i think is the defining fight of the computer industry, it benefits billions of people. >> you love to hear from tech people here.

they think competition makes things a better lace did david stockman joined us yesterday. part of the morning with david stockman was at the end of the show we played word association and no surprise, he had some strong views. account thatvery is imaginable from the disaster that he has underway in syria to the failure of the economy. you can't say enough bad things about this administration. >> janet yellen. >> the worst disaster yet. bernanke made it worse. somebody who hasn't learned anything since her thesis in 1969. >> that was the best part about my morning.

jailsly thing worse than economics department is princeton's. >> he was getting after it. >> i want to talk about matteo renzi. this is an interesting guy. if you have not seen the new italian prime minister, he took over in february. you need to get to know him. he is young and charismatic and stylish. he represents a new generation. italy has become a chair and talk received. it was old by -- run by old people. italy can't create jobs or attract investment. renzi has fashioned himself as the man who can drag italy kicking and screaming into the modern era. if there is a prime minister, this is not the message for the age. of this is a message for the

change. can invest in a new generation against the old generation of the past. some people love the past and believe in the future. >> i can't think of a starker contrast than renzi and the man who symbolized italian politics for so long. >> just as you were saying charismatic, i thought to myself i think he has a lot of charisma. >> no question. it is worth point out that he still leads or the largest arteries in the senate. renzi is going to have to find a way to build a relationship with that party. i think it is extraordinary to see a guy that old looking to take the boulder and drive up the mountain. back, a bucket

list. you can sign up with the black tomato. you will hear from the founder. ♪

>> "money clip" with adam johnson starts in about 20 minutes. >> dollar strength. the dollar is up again today. it is 7% year to date. it is at a four-year high. mario draghi is building the balance sheet. that is what is driving this thing. >> why does this upset you so much? >> for everything we have done it wrong at the fed, investors are saying it is worse elsewhere. when you think about japan. >> we are the best of the worst. >> this is a big deal for u.s. companies that are selling abroad. this is what i am going to focus on. profits at toyota have doubled in two years. at honda they have tripled in

about three years. as the yen has fallen off dramatically, this is a big move. yen, it isok at the at a six-year high. look at this thing. that is why the exporters and japan have been able to -- >> a strong dollar works to a disadvantage here in >> exactly right. we talked about u.s. companies. they are selling here in the u.s.. they are not hurt i that foreign exchange whereas today i will talk about the japanese exporters. they want to buy this. at 12.ey clip" starts coming up, meet the man who can arrange the bucket list vacation. >> you are watching "market makers" on the wennberg tv.

♪

>> what do you want to do before you die? swim with the sharks? one luxury travel company can make all of this possible through a new account list service. you have to be willing to shell out. the company is called a black tomato. let's start with that. it came from when i lived in moscow. i would go at the dinner and i would see this a black tomato on the menu. my colleagues would say it was a rare form of fruit. it is an amazing taste. we wanted to offer the black tomato of travel experiences. they were rare quality, mind blowing experiences. youhen people say how could launch this when there has been such a tough slog financially,

it is not affected you because your clients are the uber 1%. company,e started the it was just before the first recession. that made us learn a lot. great value for the trips you are offering. it is about an urgency that people need to take. travel is there dna. this is the last thing they want to give up in challenging economic times. market yourself to these people? they are not that easy to reach. they are not going to pick up a phone and call you after dropping in on your website. >> we learned a lot on how to engage them. we deliver great service that bills word-of-mouth. we have a lot of customer recommendations. it needs to be something that people will take. it >> this is the kind of thing

that does not take off on social media. >> you are sharing some special access trips. recommendation is ultimately like anything. >> let's say i want to play tennis with roger federer. imus much is a cost may? it is in the hundreds of thousands, but it depends on how we negotiate. and say i wantu to play with roger federer. there is not a set price. there is a link up between the various hearts involved in the experience. at playinglooking tennis with a superstar or going to a part of the world that is impossible to access, we work with our suppliers and share it with you. >> it doesn't have to be roger federer specifically. let's say it's an equivalent. what would he want to get aid? >> it depends.

it is about circumstance and when they are available to play. >> what's in it for you guys? is this service that you provide that much higher margin than other personal travel agencies? have an obsession with the experience first and foremost. >> if you didn't make money -- >> you have to have a business model that gives you a return. you have to make money from what you do. that is the only thing that we can do. that is a service that people pay for. we are on hand to make it special and make it work for you anytime of day. >> you came from ernst and young. you don't have a background as a concierge. many years was born

ago before we started. we traveled the world extensively and built on those contacts. withtablish relationships people all around the world who could deliver these experiences for us. we want to make sure that we are on the cutting edge. >> you have got to be looking for something new. the most amending customers will always say what have you done for me lately? how do you divide your time? some of it has to be in search for new experiences, i presume you have to experience your self in order to be able to sell them incredibly. highu are dealing with a touch market like that, a lot of it has to be customer service. isthe opportunity for travel clearly a motivation for us to start this business. delivering great products means you have to have people on the road. we have an extension -- extensive search process. >> how can you afford to pay for

that kind of research and development? >> there are suppliers that want to work with us. >> do they offer you free trips? >> we set aside a budget. greaturns into experiences we can offer and that keeps us ahead of the game. we are only going to market a few trips. there are always new things. there are new things being discovered. to be yourford client. i am volunteering to be part of your r&d team. what is the most extraordinary trip you offer? the craziest thing. >> i can talk about couple of things. travel is a very personal thing and. where you go out and camp and go in search of elephants.

it this is the only part of the world where this happens. >> black tomato. i congratulations. he is the cofounder black tomato. stay with us. ♪

>> that is going to be it for "market makers." >> friday is your birthday.

we want you to look at this executive who graduated from leland high school in portland, oregon. he is no longer a young man. this on ouring producers. i would not characterize them as an executive. >> no. no i wouldn't. >> sports apparel executive. >> phil knight from nike. thanks for watching. >> there are some people out there who don't have what are accounts. either they don't want them or they can have them. i got an instant message right around the time. kevin, you get equal credit. >> did you know is phil? i did neither. i am blaming our executive producer because i don't think of phil knight in that way.

>> we're going to start the week off right. do you like donuts? we will have the ceo of dunkin' brands. it is time to wish everyone a great weekend. it looks like it is going to be a beautiful one here in new york. is going on the markets. are diving straight into derivatives. it is time for the options insight. joining me is the head of derivative strategy. this looks like stocks are stabilizing after a rough drop yesterday. what do options indicate in terms of the length of this weakness to mark >> the applied volatility is around 12%. this says on any given day we can have a move of plus or -7/5. this is once a month.

that is an implied volatility says. investors get caught by surprise because they don't know what the options market is realizing at any given moment. we are heading into the end of the third order and the start of the fourth quarter. protection. protection. protection. is one of thely most popular areas that investors like to protect. on a tenure basis it will cost you 500 basis points. it is on the bottom quintile where it has been for 10 years. when you look at it as a cost. the -- i want to finance this. what we have seen is the upside call gives you sustained value is only up 2%. that concern about those drops is much more so than the crash. >> i want to talk to you about

one name. there is a way to get into the stock for much less. need is one of those who examples. it is a hard to buy stock. the stock trades at its price. you can't pay that money to shore it. they recognize where investors believe the stock is going. proon't cover go fundamentally. if you are were to look at the december options, if you owned that and you are short the 80, we call the combo. you are going to buy stock at 80. you're going to exercise that. andre going to be assigned pay 80 regardless. cost you nog to

money. it should be close to whatever the interest rate is. in december, you can collect money. for investors who are considering, we would look at the options if you want to do it. >> you can't short it by buying the stock. thank you so much, stacy gilbert. we will be back in 30 minutes. "money club" is next. have a great weekend. ♪

>> welcome to "money clip their co-bill gross leaves the company he founded for another. is not the only one jumping ship. down.older is stepping who is going to get his job? the ebola treatment fails. how the u.s. government screwed up the drug for this deadly virus. this bug hits computers and guess who is volatile. derek