>> from bloomberg world headquarters in new york, this is bottom line. the intersection of business and economics with a mainstream perspective. to our viewers here in the unit is days, and for those of you joining us around the world, welcome. we hope will coverage of the stocks in stories making headlines today. matt miller is at the new york stock exchange were fiat chrysler begins trading. lisa analyzes the gyrating equity in on markets. we have the latest on trading on

this columbus day 2014. >> good afternoon. that wiped off $1.5 trillion, they are fluctuating between gains and losses for most of the afternoon. the s&p 500 did drop below its 200 day moving average, but it did rally shortly after that. technical analyst look at this --el since november 12 september 2012, since it has withstood selloff. currently a flat session, and the nasdaq also trading in the red as well. >> what is behind the movements we are seeing today? >> investors adjusting comments from fed officials. u.s. rate increases could the

delight by slowing growth elsewhere in the world. today, we heard from the fed president, and he said that the central bank should be especially patient on rates. this is not a concern about whether the u.s. can withstand the foreign weakness market. >> let's get you right to the top stories of this columbus day, 2014. president obama has scheduled a white house meeting with senior administration officials next hour to discuss the ebola case in dallas. this as health officials the difference of five -- intensify the monitoring of those who care those infected. of the firstnce case of ebola spread within the u.s. changes some things and it does not change other things.

the fact thatge we know how ebola spreads. thates not change the fact it is possible to take care of ebola safely. substantiallyange how we approach it. >> a hazardous materials crew was seen the contaminating the woman's apartment. officials say she was not among the 48 caregivers who were being watched as they saw the patient before he was placed in isolation. the woman's condition is stable. day one of the, oscar pistorius sentencing hearing. the paralympic gold medalist was convicted did a couple home aside the shooting death of his girlfriend. his lawyer says that the client is a broken man, and should not face any prison time.

a sentencing of correctional supervision was recommended. but it is being called shockingly inappropriate. -- sentenceld we could be 15 years in prison to a fine. we will announce the investment in the couple of months. ackman's comments come as billion --o $.7 raised $2.7 billion. least 27 people have died and 25 have been seriously injured in crashes involving general motors cars with defective ignition switches. kenneth feinberg, who was hired by g.m. to compensate the the dems updated the totals today.

ctims updated the totals today. for desiring a hundred 50 workers to build aluminum bodied f1 50's. they pledged they would recruit 12,000 workers by 2015. fiat chrysler began trading on the new york stock exchange today under the ticker fcau. theill be registered in netherlands. this is a new chapter for chrysler which has been the automaker --you always euros u.s. automaker.

>> chrysler, now in the hands of fiat is reappearing on the stock exchange. so how have they been doing? millionthey sold 1.8 cars and trucks, that is way not 2005.n 2009, but chrysler has been the smallest of the big three, and that has not changed g.m. remains the biggest, ford is number two, and chrysler's in third place. in 2013 two other top-selling division was dodge. iny invented the minivan 1983. bestler's next selling division was cheap. -- jeep. last year the best-selling one cherokee.rand

model almost a one division, which explains why the vast majority of its sales is ram pickups. the worst-performing division for chrysler was chrysler. once again, it's minivan dominated which was a good and bad thing. they capture the largest market share in that category, but that category is shrinking. and matt miller's on the floor of the new york stock exchange with more on fiat chrysler's wall street debut. what is the ceo want to achieve with this move from the milan stock exchange to the nyse? >> one of the first things he was to be able to do is to be benchmark fiat chrysler against the other detroit automakers.

than half of more their combined sales from the u.s. market, so that makes a lot of sense. but he is making an extremely international labor more capital when he wants to tap those markets. he is registered now in amsterdam. the company's actual headquarters will be in london, and the stock will trade both in the lawn and here in new york . they want to tap a wider capital base, and they will be able to do that with this listing when they need to. this is not the best time to do that, considering that the broader market has been in a real slump for the past week. ve hadocks in general has hav a real problem since the recalls. they one car that sergio has up his sleeve is jeep. it is shocking to people that

the growth has been 27% or year. that is the fastest-growing retail auto brand in the world. hoping to double that 2018.feet deep -- they have already got a plan to invest $61 billion. is $12 billion debt loan not huge in comparison to what other automakers will have on their books. it actually works in sergio's favor. he is been talking about consolidation, and says it will happen. right now they do not have enough money to make a major debt loanbut the access a poison pills and no one will come and buy them while he is trained to turn the company around. >> thank you. he will be speaking with sergio an hour elkin in about

on street smart. in thened volatility financial markets. what is driving that and find out how investors can take advantage of buying opportunities. ♪

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>> investors might be feeling whipsawed from volatility in stock and bond markets. joining me is a global investment strategist at a financial services firm with $844 billion in assets under management and bloomberg's lisa. she covers the debt market. let me start with you. the executive summary part of tiaa cref's quarter, you wrote the following -- "the long

anticipated transition to a post-qe world might have finally begun." what leads to that? >> with the end of qe in october, we look to the fed for justification of interest rates being so low. it worked over the last couple of years because of qe and how it works in the future will be different. we are seeing volatility in the equity markets as a function of that. inis going to be different different returns. >> a lot of the volatility is coming from the concern about deflation in europe, concern about the fact that the global economy is slowing down so much that the central banks will be unable to ignite growth with their stimulus. isn't that playing into it? >> i think it may be more of a transitory effect.

people got a little bit too excited with what was going to come out of the ecb in terms of quantitative easing. in terms of what they were doing, it should not have been a surprise, but it seems to have been when you had the last press conference from mario draghi. i think that is playing into it. i think it is more transitory. when you step back and look at the macro picture, it is going to be what the fed is or is not doing. last week, the imf downgraded its outlook because they feel europe is at risk of slipping back into recession. year, 2015, how is this going to impact the u.s. economy , especially if demand for exports starts to drop? >> this is where globalization has two sides. positive is when everyone is growing. this is also when it is good that the u.s. is a relatively unexposed economy when it comes to trade. trade does not make up a big

part of gdp. on the margin, it does not help, but it does not mean there will be a big slowdown in the u.s. >> the fed is signaling that they are concerned about the global economy. one reason why 10-year and 30-year yields have come down in the u.s.. in the bond market, people are to pushwe are going back expectations for when the fed is going to hike interest rates. the fed is concerned about the strengthening dollar, potentially what the slowing growth in europe might mean. although, there is a little bit of a bounce back. if you look at the etf shares, a little bit of riskier assets. but people are gravitating back to the safe havens, particularly because the fed is signaling they do see a connection, perhaps more so in the past with the global economy. in the past, it was not this frequent and strong.

it came out that we are going to look at the global economy to determine our own move. changed is,t has when you had qe going on, the fed ignored the effects of qe on the rest of the world. they were focusing on what it meant for the u.s. economy. i think that is still the case. if you think about what the impact europe will be on the impact, butt has an broadly speaking, the fundamentals for the u.s. economy are solid. it suggests moderate but increasing growth in the u.s.. on the margins, slightly worse out of europe. >> what about emerging markets? what adjustments are they going to have to make? >> the good news is that we went through this last year with the taper tantrum. we are going to see that to some degree. interest rates are rising when

the dollar is strengthening. that is typical for emerging markets and countries with large current account deficits. that does not change. i think they are more prepared this time. ,t is going to be a struggle but we do not think it will be something that will be unduly harsh. willu do think equities continue to perform well, right? with the bond market, what will cause interest rates to rise? 10-year, 30-year yields, do you see them rising significantly in the next year? >> not at this point. there is perhaps underappreciated risk in the fixed income market. even though we are back down on the 10-year, we did have a 30-basis point run. and in equities, if we did see a , the market is3% not ready for that. the risk that we see their is

moving in that direction. >> do you think there will be more volatility on treasuries going forward than in stocks? maybe more for both. it is going to be a factor. in the domestic economy, but what european investors are doing. you cannot get any yield in europe now. there is not a whole lot to be had. you do see the spillover effect into the u.s.. what happens with the ecb will happen with the treasury market. >> we have about 30 seconds. you mention fixed income. if u.s. interest rates rise, where is their support coming from? >> you know that interest rates are going to rise. we are counseling are investors to look for those parts of the market like high-yield or emerging-market debt. , lisa abramowicz joining me in studio. thank you so much. when "bottom line" continues, we

will hear from the latest nobel prize winner for economics. how his efforts show how governments can best regulate industries that lack competition . we will be right back. ♪

wechsler this year's nobel prize for economics goes to french economist jean tirole, awarded for his work on market power and regulation. is and what he has discovered. it is a good day in france. they are celebrating. the 61-year-old head of industrial economics at toulouse university, a former m.i.t. professor, a guy who started with an engineering degree, got

a doctorate, and then went on to get another doctorate in economics. this is a very smart guy. he was awarded the nobel prize for his work on market power and regulation. many industries are dominated by a small number of large firms, what we call an old godly -- an oligopoly or monopoly. it produces undesirable outcomes like excess prices, excess restraints to competition. he used game theory and mathematics to show the common wisdom that one size fits all. thing ton is the wrong do. >> he is going against the grain of prior theory. what does this mean? >> suppose that you want to control the cost of a contract that you left with a company. you could put a contract cap on spending. if it is a firm with high fixed cost, they are going to demand high upfront payment to make up for that. a company that cuts costs may

take less up front, but will still make windfall profits because they will aggressively cut prices. you have to figure out a way to regulate all of them. companies --le, what if they were sharing patent information to make life-saving drugs? that would be a good thing. you cannot make one size fits all. industries have to be regulated on a case-by-case basis. >> wall street always keeps its eye on the economics prize. what does he think of doug frank and that kind of thing? >> it highlights another aspect of his work, how government highlights a vital industry whose participants care more about what is going on in their industry than the regulators do. here is what he told me today. >> for the banking industry, we the crisislize that starts before the crisis is self. it is prepared. we need strong regulations that

are going to prevent banks from money, not only retail banks, but investment banks. they have to be regulated. >> the europeans are just getting their banking regulations in place. he says it is too early to know how those are going to work out. is "onast the hour, it the market." .> let's get you caught up u.s. stocks fluctuating today. the s&p 500 did swing between gains and losses throughout the afternoon, trading on both sides of the 200-day moving average. 1904.05.ee, we are at to highlight some individual movers for you. first, t-mobile has -- there are plans to buy a majority stake in the company. door to telecom, which owns

t-mobile, used to entertain offers. go pro shares are falling by the most in more than two months. " will be back in 2.

>> welcome back to the second onf-hour of "bottom line" bloomberg television. i am mark crumpton. thanks for staying with us. it is time for the commodities report. su keenan joins me with the details. >> it has been under pressure for most of the session after iraq followed saudi arabia and iran for cutting prices. we are getting a late warning from the caribbean and that is turning things around as we had to close. let's go to the charts. starting with oil again, it has

almost produced all of its losses. earlier, it was cut -- it was trading below $85. it was down as much as 2% earlier in the session and is near a four-year low. the national average for retail gas is continuing to fall because of the pressure we see on all prices. now below $3.20 a gallon. in january of 2008, the record price was $4.11. opec is not ready to act, according to one analyst. industry veteran michael lynch says that until opec suggests they will stabilize prices, the market will probably keep falling. meanwhile, a positive bounce towards the year-end. they see it rising this morning. the gold story is a simple one.

it is all about the dollar and interest rates. gold jumped almost 2.5% as the dollar fell. >> let's talk about the turnaround. it mother nature have anything to do with this question mark >> it has everything to do with it. a change in the forecast. last week, we were talking about a record that had corn down. showers and it is a dramatic bounce for corn futures. weather can really delay or disrupt the harvest. almost 3%-4%. it is going to be wet and soggy. the only question is how many we are looking at. $85.50.ing right at >> ebola screenings began at jfk

with four other airports following by thursday. joining us is a principal at a global security and risk admin advisory firm. he is also the former acting commissioner of u.s. customs and border protection. welcome to "bottom line." thank you for your time today. >> my pleasure. >> should homeland security be the agency charged with establishing a single ebola protocol in the united states? >> certainly, they play a key role for people coming into the united states. layers,e several beginning with trying to control it in the overseas environment. -- ichael wolff her home wolsterholme. he told usa today, "the state is in charge of public health at the state and local level. it is a constitutional issue. the cdc cannot just walk in on these cases. a have to be invited in."

how can a response to ebola be better coordinated if there is confusion or lack of shared information at the federal, state, and local levels? not sure that there is in conflict -- >> i am not sure that there is confusion. respecting the sovereignty of states is something that has always factored into plans. each one of the entities has a different responsibility. department of homeland security has the primary responsibility for screening people coming into the country for whatever they might have. once they enter into the united states have the privacy and the responsibility at that point in time. but i do believe it is coordinated. >> we mentioned that five u.s. airports, beginning with jfk, are ramping up ebola screenings. should that be extended to more airports in the u.s.? >> i am not sure.

one of the things we need to take is a thoughtful approach, with the security overseas and the highly-infected areas. and then also take a look at where these individuals come into the united states. about 275,000 people a day come to the united states by air. 150 through the area of west africa. ton you trace their travels five airports, i believe it is about 90% of the individuals arriving in those areas. continueto be done is to target individuals and look at the flight patterns to see if they change and then deploy people to other airports if necessary. right now, i believe the five volume airports that have been identified are the best way to deal with this. >> should ebola patients in the u.s. he transferred to biocontainment units? that is the view of any thompson, ranking member of the

homeland security committee. do you think that would need -- that would lead to general panic among the public? >> that is outside my area of expertise. the ranking member does have some points that should be considered. i leave it to the professionals to find out where they can provide the best level of care and also the best level of corn team. >> -- of quarantine. >> david evans estimates that ebola's economic toll could reach $32 billion by the end of this year if it spreads from guinea, sierra leone, to the rest of africa. one of the areas is supply chain security. could these countries ever recover from the crippling economic impact of ebola? >> that is something we need to thoughtfully consider. emerging markets in these areas of west africa are critically important. there are a lot of natural resources there.

-- eed to continue why they pass away in those countries is because they do not have the right infrastructure. they do not have the right medical care. they do not have a way to dispose of the bodies. to make sure those economies are bolstered and continued to flourish is a decent strategy going forward. every move that is taking into consideration -- that is taken into consideration needs to be -- i would not advocate a move like that because of the economic impact of business in those areas. taking a thoughtful, risk-based approach is important in those areas. >> the former acting commissioner of the u.s. customs and border protection joining us from fort lauderdale, florida. inc. you for your expertise. we appreciate it.

>> we will be back in just a few moments. ♪

>> we have some breaking news on fidelity investments. more on that story. >> the latest from fidelity investments. the current vice chairman is going to be the ceo of the company according to the wall street journal. she is no stranger to the firm. she started working there some 25 years ago, initially as one of the first women on the trading floor there. she started answering the phones and worked her way up. this is fidelity investments, founded by her grandfather. it was the nation's biggest mutual fund company at one point. of course, it has many funds that they manage. the magellan fund is popularly known by a lot of individuals who put their money in these products. according to the wall street

journal, abigail johnson named ceo of fidelity investments. according to the bloomberg index, we are talking $9.2 billion in what she currently has for her wealth and this is another designation in terms of her resume. >> thank you. it is time for today's latin america report. gas and natural has offered as as they seekllion to expand in a new market with its against acquisition in three years. they have agreed to acquire 54% controllingcome the stakeholders. the acquisition will make it chile's largest electricity distributor as well as the country's biggest power transmission line operator. in third in brazil's presidential elections.

his opposition candidate has a runoff set for october 26. came from -- nieves behind and beat silva. he needs to capture most of silva's votes to win. that is according to two separate polls published last week. rose," ian"charlie bremmer. he had this to say when asked about the recent cyberattacks. --the conventional is him the conventional wisdom in russia is that the attackers have links to the russian government and the conventional whether the idea russian government is behind it. at >> you can see the entire interview tonight on bloomberg at 7:00 p.m. and 10:00 p.m. new york time.

the state of iowa propelled obama to the white house in 2008. now they have apparently turned against him. results of our exclusive poll. >> i am mark. >> and i am john. >> we are going to show you some of the top results in a key iowa senators race. justated in our poll by one point. that is effectively tied, much .loser than the september poll >> next, we look to the 2016 presidential election and ask voters to choose between hillary clinton and a raft of republicans.

we also wanted to know who the most favorably-seen politicians are in iowa. on the republican side, terry branstad. 44% in thatn at state which once loved him so much. there is plenty more on this poll on bloomberg.com. check it out. >> and remember, our new bloomberg politics broadcast is p.m.ht at 5:00 and 8:00 new york time. check out the new bloomberg politics site, with new content, articles, and videos. reminder, "taking stock" is now on a 5:30, new york time. coming up, the imf valuations are frothy and investors react. ♪

>> on this columbus day, u.s. stocks continue to drop. in the s&p 500 has fallen below its 200-day moving average for the first time in two years. betty liu joins me now. what is going on today? >> everyone is trying to figure it out. if i could figure it out for you, i would be earning millions and millions of dollars because everyone wants to find the answer. what is going on? look -- lots of speculation. our people finally realizing that the fed is going to start pulling back and hiking interest rates? and that is causing investors to

say, you know what, i am going to take the prophets i have earned and i am going to do it now -- or is it the earnings season? be surprised that that could present -- >> they are talking about draghi -nomics, too. >> and china. there are a confluence of factors right now. to help us sort it out, i pulled up one of our a writ bloomberg columnists. he joined us at the open and said this is what he believes what the fed is thinking. >> the fed and others are worried about the weaker global outlook, economic especially as the balance of risk is on the downside. second, they do not want equity markets to correct to quickly -- too quickly. therefore, they are coming off -- coming out with reassuring comments. >> they were already walking on a tight rope.

a are walking on and even thinner tight rope, you could say. the market is on pins and needles for what they will do next. we are going to be all markets during "street smart." i am filling in for trish regan. and analyst is joining us and he is still bullish on the markets. he sees 2125 on the snp in the within theths -- s&p next 12 months. he has not changed that. >> that has got to be a mistake. >> we will see if anything changed for him in the last 24 hours. >> conventional thinking has been, at least by the middle of next year, they are going to move on rates. have you heard anything that is moving people? >> we heard stanley fischer say that if markets continue to decline overseas, that could

frombly delay the fed raising interest rates by the middle of next year. this is a moving target i always find it funny how people think that, once the fed says it's something, they are going to ignore the factors leading up to that change, that they are going to be stuck on that one forecast. >> a betty liu will be joining us, filling in for trish regan top ofeet smart" at the the hour. matt miller is at the new york stock exchange. fiat automobiles making their debut, giving u.s. investors the opportunity. they are hoping to increase vehicle sales by almost 60%. matt is standing by at the exchange with the ceo of fiat, sergio marchionne. >> i am here with sergio and john. they started trading their shares on the nyse.

congratulations on that to both of you. let me ask you what you think this does for you, a listing here. you are already trading the stock in milan. it is not an ipo. you are not selling a lot of shares. finally taking chrysler back to the u.s. market after it was delisted back in the late 1990's. it is a comeback story as well. i think they need to be here for a variety of reasons, to access the biggest capital market in the world. home.ls like being i think we are in the right place. >> it kind of is being home for some of you. you have a residence here in new york. >> i was born in new york. here on the new york stock exchange is where we should be. capitalabout tapping markets? is that something you want to do

relatively soon? >> we are going to tap these debt markets for sure. i think the question about the equity piece of this depends on discussions we need to have with about our plan going forward. technically, we do not need equities. we may issue some just as a safety. a slowdown in the industry or whatever reason. it is all up in the air. i think the prospects are good. i have seen some rather nefarious notes on the prospects for the rest of 2014 and 2015. are indications are otherwise. we are going to wait until the end of the month. we are not as negative as the other guys. situation in russia does not concern you as much? >> it does concern me for geopolitical reasons.

it may have some impact on our volumes. different.etely our position in latin america is different than anyone else. we are the busy -- the biggest carmaker in brazil. so i think we going to do better than anybody is expecting in 2015. we will wait to give you a , but therecast negativity surrounding the car stocks is unnecessary, i think. >> let me ask you about your take on the five-year plan. a lot of people are talking about lofty goals. do you think they seem easily achievable or within reason? does it take perfection to achieve them? are do not think they easily achievable, but i am sure

that they are achievable. it shows a very strong commitment that we have with fiat chrysler coming together and being the company it is. i am confident about our future. >> one of the things that has got to make you confident is jeeps sales. you are well on track to sell a million this year. the fastest-growing retail automotive ran in the world -- brand in the world. you can overshoot that without a problem. park.is not a walk in the it is 900,000 cars. >> about a year. sold 500,000e cars. intentionsthe best and the same level of optimism. we may even blow through it. but i do not think it is a walk

in the park. ,his is the great value in jeep the fact that they are a global brand. finding acceptance outside the united states of the brand. we will have the first plant up and running by next year and the second coming out in 2016. it is a glorious future. >> one of my main focuses has been the offer of mail -- alfa romeo 4c. >> they are on their way to the u.s. goal and iabout your hope that you achieve that. it seems like a very lofty goal. >> the only way you will be able to gauge that is the first car coming out of alfa in 2015. you can mark the date now.

the first midsized car for alfa. the best is yet to come. >> im excited to try it. what do you think about the prospect of alfa's growth in the u.s.? only the car snobs know the brand well. >> we just celebrated the anniversary in l.a. this weekend and saw how much passion there is for ferrari. i'm sure that if we have the o has products, alfa rome a bright future in the u.s. >> i share your passion for ferrari as well. i have been rooting for alonso as well. it does not seem like he will be driving for your team next year. who is going to drive the other car? >> i think we have two drivers now. next year.e two i would not worry about

anything. >> are you excited about the prospects of getting back on the podium with sebastian? >> i do nothing ferrari has confirmed anything about the change of drivers. >> just trying to get a little bit out of you. confirm that we have every intention of getting back on the podium. for sadie's has done a great job with the 2014 car. i think we have a few months to clean up the 2015 vehicle. this season is gone. .here is nothing you can do we need to work on next year's car. i feel comfortable. >> i wish you the best of luck to read obviously, ferrari has the biggest fan base in auto racing history and the best track record as well. for spendingmuch some time with me on the new york stock exchange floor. betty liu, back to you.

>> thank you so much. matt miller on the floor of the withork stock exchange sergio marchionne and the chairman of the chrysler. welcome to the most important power of the session. major averages down a half a percent. the dow is off the least. will stock snap out of their funk and get back on track? time to buy the correction in small caps? we will hear from the chief equities that it is adam parker. -- strategist adam parker. ♪ 60 minutes left until the closing bell. to u.s. and turkey agreed help trains. rebels and allowed use of