live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> house and before your cash is trash? apple pay and did coin -- bitcoin are the start. we will see how soon until a truly cashless society. >> republicans are the favorites to capture the senate. we will talk to bloomberg's political gurus. >> luck of the irish. they have been attracting american companies because of

low tax rates. if that goes away, what does ireland have to offer? welcome to a very special monday morning on "market makers." happy november. i am stephanie ruhle. >> i am tha matt miller. erik is on assignment. we will be hearing from him throughout the program. we will kick it off with breaking news. >> economic news. we have big numbers coming out this morning from the manufacturing sector. michael mckee has the headlines in the newsroom. how is the heartbeat of america? >> it is beating very loudly and strongly surprisingly. we were expecting a decline in the index. to 59., it goes way up we thought this was going down. we get a big jump in new orders,

a 5.8% jump. also a jump in production up to 64.8 and employment rises to 55.5. these are really good numbers. manufacturing had a slump at the end of the summer. seems to be coming back strongly with new orders that should keep it going. they are starting to hire again. this is the kind of number that should make investors very happy. good news for the manufacturing sector. probably good news for those stocks as well. >> new order, one of my all-time favorite bands. >> joy division is what happened to new order. >> michael mckee, thank you for giving us the latest. top'm going to give you the level business stories you need to know about this morning. a mixed bag of results for october auto sales. increases for utility vehicles led by a 2%

increase for chrysler's jeep brand in the month. general motors says sales were flat coming up short of estimates with cadillac sales down 8%. ford sales fell for october but still did better than the drop analysts had forecast. federal safety investigators are months away from figuring out why richard branson's experiment to spaceship crashed. he says the ntsb said it was not a problem with the engineers. a lever was pulled early deploying the boom. the spaceship disintegrated after that. branson spoke to bloomberg an hour ago. >> they told us to push ahead with the building of the next spaceship and to testing it as quickly as possible. we are absolutely confident ande is no fundamental flaw our team will be working 24 hours a day to get back on track.

>> the crash was the second accident involving a private spacecraft last week. and unmanned orbital science rocket blew up three days earlier. shares of hsbc following in london. the bank posted third-quarter profits that missed estimates. they set aside almost $1 billion for costs associated with the probe in the currency rating elevations -- politicians. republicans are on the verge of capturing the senate. americans for tomorrow in midterm elections. according to three models, there is a 70% chance the gop will pick up the succeeds it needs to have a senate majority. no need to check models for the house. republicans have a big majority already and are expected to add to it. >> more on the two commercial space disasters raising a lot of safety concerns about the for-profit space travel business. mia has more on what these could mean for the future.

those who are waiting for the first commercial flight, space tourists, are the streams up in smoke? >> not necessarily. a lot of people who shelled out close to $250,000 for virgin, many of them have been used to waiting and being patient. initially he wanted to go into the end of this year. that got pushed back to early spring next year. i spoke to a couple of space analysts. marco said timing is going to be an issue. he thinks one to three years will be the pushback. another analyst essentially saying three to five years. >> can people get their money back? >> yes. richard branson's heart is out there also. this is an emotional decision for him to say he wants to launch the first tourists in space. he's willing to refund. it is not a money game for him. he is doing this because he

wants to be innovative and a pioneer. he really is. perhaps one or two people pull out. is that a big deal in the long scheme? >> for branson, it is truly all tourism. he has competitors in this space? >> i spoke to marco at teal group. he said there are four top players. virgin galactic is the pioneer. they will be the first commercial space line. others. three blue origin is interesting because it is another one founded by a billionaire, jeff bezos. they have not given the timeframe on when they want to launch the first spacecraft, but they are looking to offer low-cost offers. taking a page from the amazon book of finding the low-cost provider. >> are you going into space anytime soon? >> why wouldn't you if money were not an issue? >> excuse me.

why? i have no interest. to me it is unsafe. it is not something i want to do. if nasa is behind it -- i don't personally feel comfortable with private space travel. >> i would be there in an instant. >> safety is the biggest issue. they need to delineate clear safety standards to the public as well as the faa. they have to do a lot more tests. this is the fourth time the virgin galactic had a test on the rocket engine. they wanted to launch in the spring of 2015. that is not enough. analysts say there have to be hundreds of these tests. that will cost money. they need to have that before they put people up in the air. >> i have kids. i am not jumping out of planes or getting on rockets anytime soon. thanks for breaking it down for us. coming up, we are going to

talk about the cashless society. did i hear bitcoin? >> my favorite. 12 days of bitcoin. moneyare heading to the 20/20 conference in las vegas. >> it has been one of the favorite tax shelters for american business. what happens if ireland raises its rates? ♪

>> locum back to "market makers." --welcome back to "market makers." onre is a revolution going in how we use our money. thousands of people are in las vegas this week to examine that issue at the money 2020 conference erik schatzker is in vegas standing by with one of them who is betting on this revolution. >> you would love it out here.

all those financial technology nerdy types you think are so cute are hereby the thousands talking about the future of money. that is what i'm going to talk .bout now with jordan let's begin with this. most people don't understand anything about financial technology beyond apple pay and possibly bitcoin. where is the investing opportunity? >> i think there is a lot. when you talk about apple pay and bitcoin, we are talking about consumers and merchants. littles ago, there was of it. it was hard to crack in. 10 years later, it has been bearish on mobile payments. over the last 10 years, a lot has evolved. with apple pay going after consumers, it gives a nice opportunity to help with point of sale merchants accept

payments through mobile phones or other mechanisms. >> apple pay looms large over this event. is it not much of a game changer? >> i think it can be. it is still very early. less than 10% of merchants have terminals. needr's need -- consumers and iphone 6 so that number is relatively small. there are now over one million people using it. they are making the bet if you deliver great products to consumers, they will use it. that is the bet apple has always made. they have signed up large merchants like whole foods now accepting these apple payments. i think it is starting to work. it is still early days. you have to give to the merchants and consumers. there has got to be a real value proposition on both sides. >> as you point out, it is not like everyone will have an iphone.

it is not like every merchant is going to have this terminal for at least another couple of years. there is the big date next year which will force transition. the transition in 2015 could have a big affect. there are people working on next generation terminals that would have the technology. it could be sooner than you think. for small merchants to pay $500 $500 to upgrade today, probably is not going to happen right away. thatat about the movement rite-aid to opt out of this exchange? solution, currency is what they call it, what is your view? >> i think we have a mobile payment war going on. it will take a while to flush out. i would not bet against apple.

have their work cut out for them. i will say this. the idea that merchants would from 1.5% tonge 3%, that is a big value proposition to merchants. apple pay has done a great job with consumers. they have early adopters on merchants but they need to continue to give to the merchants to have this two-sided network take hold. i think what is going to happen, i don't know with cvs and rite-aid, but apple is keeping data on consumers. if they get smart, they will ditch mcx may be. and in turnhesis ask apple back for the data. pay 150 basis points is worth

the cost if you can get that kind of data in return. >> what is your take on bitcoin? >> i get asked that a lot. lensin is all about the through which you view it. it is down off its peak as value but is off to 2% year-over-year from today. i'm not a global macroeconomist and will not comment on historic value. i will say the technology is interesting. today you can only three-party transaction online and narrow that down to two parties and eliminate the middleman, that is powerful stuff. there are certain technologies being built on the block, things like micro-payments and cross-border remittances. cross-border remittances, $650 billion get transferred peer-to-peer. the cost is anywhere from 9% to 11%.

is it efficient? yes. do consumers need better and cheaper products? yes. >> bitcoin potentially threatens western union and money gramm. what other legacy platforms or business models are most at risk as a result of what is happening in financial technology? >> i think that is an interstate question. everyone is still trying to figure out how the world shakes out. i think that is an interstate question. they could be at risk but they could be smarter and figure out how to adopt the queen earlier. aret of technologies selling to banks to help them get wise to what needs to happen. in and around commercial payments, there is an opportunity for other people to to paywith card networks other businesses on existing

rails. there are opportunities to pay , but on steroids with remittance data as an important key if electronic havens are going to work. and banks understand this are trying to work with new players in the market because they don't want to be disrupted. in other cases, there are banks that feel like they can build this internally and keep it as a walled garden. we will see how that works out. >> of those three buckets, payments, investment, lending, what do banks consider most attractive? >> we think they are all interesting. with apple pay, on the payment side we are most interested with the b2b payments. lending, it has all been exciting.

i think a few things are going to happen that we find most interesting. one is products will get more public it it. we see new companies focused on commercial real estate, residential real estate, nonqualified mortgages. that is interesting because unlike consumer term loans that are micro-based lending, the mortgage industry is complicated. the data you need to collect and how the process works. we think that is interesting. the second piece in lending is this next-generation supply finance, dynamic discounting, reversed supply chain finance. all interesting stuff. on investing, we have just begun to scratch the surface. we have an investment in a company being termed a global advisor. andhink on the consumer institutional side big data has not been leveraged. it has not been leveraged in investing at the way it should.

if you think about the average consumer, they typically pay too much in fees and are exposed to too much risk. all this can be solved through better products and technology. >> there is fascinating stuff happening in technology. jordan bettman is the senior principal at bain ventures. we talking about technology, innovation, change. did you notice there's one word i did not use? >> disruptive innovation? disruption? >> thank god you did not say disrupt. i hope we have all moved past disrupt. >> we are going to come back to to with few will talk you throughout the entire day with more exclusive interviews, my own partner at money 2020. coming up, republicans on the verge of taking over the senate? paging my mother! we will tell you what to look for tomorrow. ♪

>> welcome back to "market makers." i am stephanie ruhle. matt miller is here for this one. this is the talk of the financial industry. i am not talking about the markets or in versions. i'm not even talking about carl icahn. in hongy takes place kong, a tragedy, where a former bankamerica and plenty has been

charged with the murder of two women in an exclusive apartment building. one woman was found inside a suitcase. the suspect is a british citizen. we have they said it previously had an employee by that name. from a b of e-mail a account says he's out of the office indefinitely. it recommended contacting someone who is not an insane psychopath. i don't know how up to speed you are on this story. it is amazing. in a high-end apartment building wereng kong, two women found in this guy's apartment. how does this happen? it sounds horrendous. i immediately think of "american psycho." i immediately picture this guy is christian bale. it is much worse. it is alleged he killed at least

two people. i don't think being a psychopath means you are incompetent to stand trial. it would stille be liable in a court of law even if you are a psychopath as opposed to the insanity defense where you would not have to serve the traditional -- >> the glamorization of "american psycho" or sociopathic ifavior of wall street guys, that kind of thing leads to this to happen is horrible. >> maybe michael lewis picked this up after our discussion last week. >> here is somebody who would not be impressed. no one would. when we come back, ireland's pro-business strategy is more than tax breaks. >> how to dine and dash. we are not talking about running out on the check. we will have more on the future erik at money

2020. ♪

>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. welcome back to "market makers." i am stephanie ruhle. i am matt miller. erik schatzker is that the money 2020 conference in las vegas. we will be hearing from him shortly. >> ireland's low corporate tax rate has attracted major multinational companies to legally base operations there even as they keep actual headquarters in u.s. a lot of people do not like that. with mounting pressure to end tax inversions and reform the

tax code, will their luck run out? ida ireland is the government agency responsible for attracting foreign investment. welcome to "market makers." tell us why it is so attractive to do business in ireland. >> multiple reasons. i have been hearing these calls for the last week. wepanies say the talent, have lots of good talent available. >> in the first instance, don't they mention the tax implications? >> surprisingly not. >> an open secret. >> in my mind, i would think a lower tax bill would be one of the big reasons to move their. >> you have to be able to do business first before tax incentives come into play. disproportionate attention paid to tax in ireland. talent is the first thing that comes into play. second, we have an extremely

pro-business environment in ireland. the rule of law is important so you can protect your investment around regulation. that is important. taxes do come into play. we have a competitive tax regime. that is one of the reasons companies come to ireland. >> what is going to happen if we do change the laws and is more attractive for u.s. companies to stay in the u.s.? what is that going to do to ireland as a business hub? >> i think all jurisdictions compete on tax. it is not just about the u.s. >> we lock people in. >> you have your own tax regime which is different to ireland's. in terms of corporate tax, it is higher. in terms of personal taxation, it is lower. we have a 12% general rate that applies to everything. we have made changes in the recent budget. we have changed our residency rules. if you're going to have your company registered in ireland, you also have to be a tax resident in ireland.

we have introduced new competitive initiatives around taxation. >> like what? introduce aing to lower income tax rate that will apply to income derived from intellectual property. that is going to be in place by this time next year. >> your new regulations have gone the other way. companies are going to have to and also arehere going to have to foot a bigger portion of the bill, right? there are certain loopholes in the past which are no longer going to apply. >> we have not had any loopholes, just to be clear. >> i honestly did not like the word loopholes. >> i don't like the word. had certain tax treatments in the past that will no one replied. >> there are differences in international tax regimes. ireland has taken the initiative

and closed off one of those possibilities. we expect others may follow suit. i think what that will bring into focus is not really about tax to be honest. i am looking at a pipeline of some of the top-tier companies coming into ireland at the moment. i asked the affected continuing to next year. >> how dependent is ireland's economy on foreign investment? >> foreign investment has been really good for ireland. there are over 585 u.s. committees based in ireland with 118,000 people employed. investment, so it is really important from the perspective. we are also seeing recovery and other parts of the economy in ireland. foreign direct investment worked well the last number of years. we are now seeing returns in the domestic economy and consumption. ireland is to post the highest growth rate in europe this year. >> let's take out foreign investment. let's take out apple and u.s.

businesses having businesses there. what is your economy look like? what are the big businesses other than hubs? in theo very well indigenous economy in the sectors that are strong. i.t. and medical devices. we have a strong developing cadre of developing businesses -- indigenous businesses. we have unique advantages around agriculture and tourism. >> it is simplifying it to say pubs. it is more than just a pub. you can live there. >> you can argue it is one of our better exports. >> i wonder about the talent part. you highlight this as one of the most important reasons for companies to move to ireland. i am irish so i get it. stephanie who is new jersey german might not understand.

how do you get this kind of talent? is it because of the school system, the work ethic? >> i think there are a number of things. we have a strong history of good education in ireland. we have one of the highest participation rates in the oecd. we have access to the european labor market of people can work in ireland. we have prioritized math and engineering and incentivized students to go into those areas. they feed directly into the around i.t., farm, and medical devices, financial services. >> there is a lot going on. >> they make beautiful sweaters. >> thank you so much. we are going to take a quick break. when we come back, we have breaking news from the automotive industry. mia, what have you got?

ford mustang? >> breaking news coming across the wires. we are talking cars. kia is a subsidiary of hyundai. they have been claiming 40 miles per gallon sports cars. that was an overstatement. they will have to pay $100 million in u.s. fines for overstating fuel economy on the stickers consumers see in the server's -- showrooms. these companies are based in seoul. they share engines. overwill have to fork greenhouse gas emission credits and will have to certify future mileage. these companies facing fines in the u.s.. >> that is interesting. more importantly, for just said it will be selling its new mustang at dealerships in six days. that is the headline i am watching. you watch the hyundai-kia

story. >> you started the advertisements early. we did not start a commercial break at. >> isn't that something you grew up wanting? did you ever want one? >> mustang would not be popular in ireland. >> do you have an irish car you wanted? >> not particularly. we go for the german brands when it comes to cars. >> what was your first car? >> a baby blue volvo station wagon from 1984. really classic. then a chrysler lebaron convertible. we are going to take a quick rake. stay with us on "market makers." ♪

>> would have more breaking auto news out of toyota -- we have more breaking auto news out of toyota.

6.9%a u.s. auto sales up in october. possibly more interesting to investors is china sales up 27.1% year-over-year. toyota china october sales up 27.1%. investors watching that relationship closely because japanese cars are not really welcome in china these days, but these numbers may something -- say something different late. we will continue to watch auto breaking news, including anything involving the mustang. >> coming out in six days. >> we are hours away from the midterm election that is heavily tilted towards republicans. final polls show the gop gaining momentum in several states. tot analysts expect them gain control of the senate and increase their majority in the house. let's take one last look at the campaign with bloomberg managing

political editors. i know you are busy grinding it out over the last 48 hours. any surprises in store? >> if there were surprises, we would not know about them. the two most likely surprises, one is a much eager republican year than we are expecting where they might win governor's races in places like illinois and massachusetts and maryland. is forer surprise democrats to do a little bit better than the current best case where there is a path where they keep control of the senate, which is a big battle. >> would say republicans do when the senate. winet's say republicans do the senate. could there be more gridlock? >> i think that is beyond the realm of conception. i think the president will certainly not want the last two years of his time in office to be completely wasted.

he is not going to throw away those two years. the question is what the attitude of republicans is going to be if they are in control of the senate and house and whether they want to legislate, score political points, and of both those things factor into how they want to set up their party and presidential candidates for 2016. >> ted cruz gave an interview this week in saying he wants the republican senate to be more confrontational. he is not really running the senate if they take it back. but he seems to have a lot of power in this party. >> he does. that attitude is going to be one a lot of republicans coming off a successful midterm would take in january 2 new the new congress -- to the new congress. for republicans, any deal with obama is a bad deal. i think it is going to be up to mitch mcconnell, if he is the senate republican majority leader, and john boehner

returning as speaker of the house to decide what they want to do. politics matters. governing matters, too. if republican leaders care about getting things done, they may have to stand up to ted cruz's if those people say we do not want any deals with barack obama no matter what. >> do you think republicans will again use the threat of a government shutdown to try to repeal obamacare? >> i cannot imagine the republicans will do that. oute is nothing that came of the last government shutdown good for republicans. increased their margins in the house. it was despite the damage done politically with the last shutdown. i do not think there are many republicans who think the best thing to do would be to shut down the government or repeal obamacare, although many have said they would like to do that. a lot of people in the country do not like obamacare in principle. many of the things it is doing are popular.

republicans are faced with the difficulty of trying to navigate through a law that is quickly becoming embedded in american life. >> are you saying republicans have gotten over it and accept obamacare as part of the system? >> they don't. i think they are trying to figure out a way to repeal it and replace it with something more rocket oriented while they wait for a republican president to start largely from scratch. the ted cruz confrontational republican party, is that the way of the future? are we going to get over this super partisan politics in washington? >> that is a we will see kind of thing. is a faction of republicans in the house that are off occasional and do not want any kind of deal if it involves getting the signature of the president. that is a much smaller portion of the senate. ted cruz is an outlier in that regard. most republicans in the senate are closer to the conservative

mainstream. a lot of people like mitch mcconnell who will be leaving the caucus recognize the fact that in order to win a national election, something republicans ave not done, they will be to need to show they can get things don. there will be strong pressure to legislate. >> we are 14 months away from the iowa caucuses. when do you think we will hear from potential candidates announce that they are running? >> some in january and february. i think the vast majority will be in by then. some of the bigger candidates may wait until the spring and summer to see who else runs and avoid being in the spotlight longer than they have to be because that comes with scrutiny. >> do you have a thought on who may announce first? >> i do, but it is a secret. >> [laughter] all right. >> i don't have the faintest

clue who will announce first. there has been discussion about chris christie going early. i can imagine that happening. >> besides voting tomorrow, i will be watching bloomberg politics. it will be never ending, awesome tomorrow. close, ipolls start to hope you are going to be watching bloomberg politics all nighter. of thell have coverage races across the u.s. starting at 7:00 and going all night long. >> sounds like a lot of work. i will be watching that from my couch in my pajamas. my heart goes out to all of you. >> coming up, no more waiting for the bill. we will meet an entrepreneur who can make it happen. ♪

>> welcome back to "market makers." i am stephanie ruhle. take you back

to vegas for the money 2020 conference. thousands have gathered to discuss the revolution of how we use money. erik is there was an entrepreneur who is a big part of it. >> it is your favorite bar and restaurant. don't you hate waiting for the check? i hate waiting. but jeff macgregor really hates waiting for the check. that is why he started a company to solve the problem. explain how this works. >> thanks for having me. in bars and restaurants is a uniquely frustrating experience. you're handing your credit card over to a stranger. if you're splitting the bill, you are putting it on five different credit cards. really painful. apps allow you to check in, view your tab in real-time, split the bill with friends, and pay with one press of a button so you never have to hand your credit card over again. >> what is the difference between what you are doing and

what opentable is trying to do with payments? >> opentable is going after a more high-end venue. they are using their capability to do reservations. you're typically seated at a table and paying on your phone through the app. it is a feature of an existing app. dash is built from the ground up. we found it is much better and pain in bars and restaurants. if you made a reservation, you have been eating for two hours, so you're not in a rush. at a high-volume bar in new york, much easier to pay on your phone. >> how do you make money? forith process transactions so many venues that we get a lower processing rate. we take the difference in processing rates. the angle is we have this captive audience we can bring into restaurants and bars to give them more business. leveraging that temple to bring people into the merchants and

the merchants pay a fee for that. there are about 50 new york city. we launched in chicago last month with 30. we are moving east coast to west coast and expanding nationwide. >> two or three years from now thanks to technology we are seeing right here at the money 2020 conference, biometrics, digital wallets like apple pay, nfc, all of that will be on everybody's phone and that every merchant. isn't it happens, easier to pay with apple pay? >> very challenging. apple pay is focused on using technology where you're paying at the register at the terminal. >> that is where the terminals are today. >> very different in a restaurant. >> there could be a tiny terminal under the bar or table. >> at the table, it could happen because we know what table you are seated at. for bar, very challenging

the point-of-sale system to know who you are and what you're paying for. there is a lot of time before the technology catches up. it could be upwards of eight or nine years. betting the rate of adoption will be so slow that you are able to build enough of a business between now and then, that there is a stickiness factor they will not be able to get over. >> absolutely. our technology is built and we are rolling it out nationwide so we can leverage that technology. >> right now, you are only solving one problem. it is a problem we all share. but it is only one problem. once you have the merchant relationship, what else can you do? >> for merchants, it is about yield management. we can increase average ticket price so people are spending more trhrough dash. our average tip is 24% which is a great indication people enjoy

using the app and are spending more. we have increased average sticker price upwards of 30% so people are spending more. some of that is providing incentives to the user to go out and dying through da -- dine through das herbalifh. also being able to bring more people in is important to us. >> i will have to try that in new york. jeff macgregor is the ceo of dash at money 2020 in las vegas. >> you're always in a rush to get your bill. how about the european way? i don't mind waiting for the bill. i don't like restaurants trying to turn my table over. i don't want to rush. i want to stay and have another drink. you did not like that? we have lost you. we will see erik in the next hour. he is in vegas. "market makers" will be back in a moment.

how can we spend time talking cashless society without talking bitcoin? ♪

bitcoin.g on supporters say you cannot have a cashless society without it. we will speak with the three people behind the bitcoin boom. butot just three people, three people. there are so many people behind the bitcoin boom. americans in love with suv's. gasican gas prices -- lower prices are fueling sales of suvs. >> narrowing the digital divide.

have republicans found the secret of how to win elections using technology? do people who vote republican use computers? we will find out. schatzker is on assignment that the money 2020 conference in las vegas. he will be speaking to those three bitcoin moguls, enthusiasts? we will get to that. first, we start with the bulletin. course, theing, of public and use computers, tea party members, libertarians. the top business stories this morning. another sign that u.s. factories are withstanding slower global demand. manufacturing rose in october at a faster pace than forecast. one gauge of production was the

highest in more than a decade. lower energy prices and a stronger job market are likely to keep assembly lines busy. apple is considering another bond sale. for the first time, the company may sell debt in euros, not dollars, according to someone familiar with the matter. apple is holding calls with investors today. transactions in euros would allow them to borrow at the lowest rate relative to debt. virgin america is seeking $320 million in an ipo. the airline has been flying for seven years and is partially owned by richard branson. the timing may be good. airline ticket prices are up and so are profits. planes are fuel and jet fuel is headed for its first annual decline in six years. secretary of state john kerry says bombing is not the only thing that can slow down islamic state. the west has stepped up the

offensive against the groups financing. he spoke to charlie rose. >> we are working on the measures that need to be taken in concert with many other countries to close down avenues for banking, transfers, to identify people who are large and to blocking that, identify the means by which they are collecting money and smaller sums but from larger numbers of people. all of these avenues are being pursued. >> you can watch that interview tonight on "charlie rose" at 7:00 and 10:00 p.m. eastern. here in new york, one world trade center is officially open for business. the first tenant moved in today. .ondé nast the building is on the site of the twin towers that were destroyed on 9/11. 6 feet high, the

tallest building in the country. falling oil prices means lower gas prices for americans. apparently that is sending them back to the auto showrooms to cars.vs and big ford, chrysler, and nissan reported better-than-expected october sales think a large part to growing is uv sales. gm was the only carmaker to miss estimates. with me this morning is a deputy jalopnick.com. i spend a lot of time on that. i wonder what you think -- we think about sales as compared to wall street estimates, but if you look at it, ford sales fell in october. what is going on? >> they are in an interesting area because it is a traditional time. you have the new mustang, the coming into the

showroom. you are starting to see those sales pick up but people will not be by the 2014 model. >> but you get it at a discount? >> the idea is that the f-150 and the mustang are so revolutionary to the old ones, why would you get the old one? a great piece about this. it has basically become the iphone. even if the iphone 6, the five s is half off. you have to have it, and that is what we are seeing. >> you want the newest of the new. if you are going to buy a new car, buy a new one. >> so what happens to the 2014 models? >> somebody will buy them, but sales will continue to slow down on those until the 20 15th are in full force. >> if we are seeing increased sales -->>

>> [indiscernible] let's talk about hybrid sales. if you are going to buy more ofps, more silverado's, all these big suvs and even smaller crossovers because of cheaper gas, does that mean that you buy fewer prius'and hybrids? >> i think it means that you buy more cards in general. right now we have lower gas prices that we have had for a long time, so people are thinking, gas is cheap, i will buy something bigger. we see how low gas prices have held truck and suv sales. do you see a decline in the previous -- priuses of the world? >> i don't think so. i think those that want able to buy it here but some others will think about a bigger car.

>> what about tesla sales? is that altered by gas prices or is that a complete anomaly? >> you brought up the apple thing before. i would have to say tesla is the newest and coolest thing out there. people are going to buy no matter what. >> how big of a threat is tesla really? we love to cover it, we love elon musk, but in terms of auto sales, how much are they impacting automakers? >> for the premium brands, soking at the bmw 5 series, series, they are definitely a factor. you see these manufacturers bringing out hybrid options in order to compete with what tesla has. they will not say outright that they are competing but they are. >> i do not want to get too far off subject, but let's talk about the model d. horsepower, 650 pounds of

torque. would you rather have that or a bmw i8? >> i8. >> why? it is so much smaller. >> help us understand why fiat had to sell for ari -- ferrari. >> they want to create more value and bring in more investment. when they initially announced it, i was perplexed, but it seems to make sense to bring in that extra investment. >> sergio wants to put a bigger value on ferrari. he thought he was being undervalued. can they still use the ferrari cache when they are selling maserati's and jeeps? past, one of their brand used ferrari engines in their car. maserati has for ari --ferrari-today engines.

>> ferrari has such a winning history in motorsport. will they continue to have that or can they get it back if they do not have the kind of investment that the output behind their formula one team? >> first of all, they need to begin winning again. this weekend, they were kind of nowhere. it is tough, there is only one other formula one team with public investment and that is williams. they are doing as great. i would be interested to see how public investment would make them do well on the track. >> is a reimporting cars going to become a big thing? i think so. >> sergio could be at the forefront of that. that is a part of his plan, to be reimporting cars. we will see if that works out for him. it would not be a bad idea with

the euro. >> technically they are not building in italy. the dart and the chrysler 500 are fiat cars being branded over here. we like bigger and wider things here in america. >> that was asking for it with matt. i know you will say this is complicated, but if you could have one car, what would you pick? >> we would probably say the same thing. i would pick a 911 gts. >> i was going to say mazda miada. it is the best car in the world. >> i have inside information that travis is possibly about to buy a new car. miata? color is your >> dark blue. do you listen to kenny g? >> nobody listens to that.

they listen to regular music like regular people. >> thank you so much. a picture ofeet his miata. did i mention i am going to be a judge at the jalopnik film festival? >> we are having a film festival with user generated films. a huge party on wednesday. thursday, we are taking overnight talk cinema this. was my favorite animated film. we go backcome back, to vegas for more on the future of money. first, we look at the technology that makes apple pay run. >> how soon before bitcoin is in your digital wallet. what it would take for the virtual currency to go mainstream. ♪

square, google wallet, bitcoin, there is a revolution going on in how we used honey. thousands of people are in las vegas to examine the issue at the money 2020 conference. erik schatzker is there with the ceo of first data. he formerly worked for citigroup and then jpmorgan for eight years. since 2013, he has been the ceo of first data, one of the world largest payment processing companies. first data is playing a key enabling role in apple pay. how is that going? >> fabulous. we are processing close to 100,000 transactions a week. as you would expect, it is a ramped up, but the embracing by merchants and consumers is very large. i think what is really important is it is all about enabling the

merchant, the consumer, giving the client a chance to do business the way they want to do business. 100,000 transactions a week, is that where you expected to be? >> closer to what we expected but i would consider this a constant ramp. you will see a lot of enablement at the point-of-sale. you see a lot of enablement on the web. you see the in-app solution growing. everybody is picking about it, embracing it. it is a great start. >> october 2015 is a key date because merchants around the country are going to have to start putting in these so-called chip and pin terminals. emb technology. will that drive the uptake of things like apple pay and other digital solutions? emv is a huge point in time for everybody to embrace change.

it will change at the terminal, change at the point-of-sale. there is a huge embracement. if people have to switch out a terminal, they would think about a solution. we have built solutions like clover and move, from a point-of-sale to a point of solution. i think you will see huge enablement at large merchants and small. it is changed. y2k for the point-of-sale. >> clover is your company's alternative to what others may have seen with the square stand, the tablet at the point-of-sale at merchants. small business, they have something on the desk, you flip it around and you sign. over does the same thing? >> yes, and we are coming out with a version today that will operate on mobile. you can expect us to enable software at the point-of-sale. the great thing about clover,

it's an open environment. we are here at money 2020 embracing the development community. we like to create solutions in the crowd and then ask everyone from silicon valley to silicon valley to join us. in queue.er 100 apps 40 developed on clover. >> what about the merchants who are trying to keep apple pay out of the stores, is that going to work? >> i embrace all the merchants. we had 6.1 million merchants globally. we view ourselves as a grand collaborator. we view ourselves as an enabler. there is always choice. i think they are making a choice. there is a lot of work that goes behind mcx. decker is speaking here, in fact. >> we will be speaking with him, are you working with mcx? >> yes, our job is to enable our

clients. think of us as a grand collaborator. >> first data was one of the largest leveraged buyout of all time. almost $30 billion. it has been a tough slog for kkr. how long do you figure that they are in the black on this deal? >> we did a $3.5 billion equity raise. statistically, the largest private placement of its kind. we did it at the current mark, no discount. the largest equity transaction before us was facebook. after us was alibaba. i am not saying we are the company, but don't feel that having that as your bookend. parker.been a fabulous if you saw what they did, they invested kkr money. this is a long-term investment for them and me. >> here is what people do not

understand, they look at mastercard up 20 times since its ipo, lisa is up six times since ipo four years ago and they wonder, on the backend, is first data processing the transactions? why hasn't your company benefited similarly? >> this is waterfront property. we came up with the lbo and hit the worst financial time in the world and, at the same point in time -- >> so did mastercard and visa. >> a lot of money was chasing payments. the position of the company was not designed to invest. now it is designed to invest and grow. we have built seven products over the past year. payment is a growth industry and you will see us continue to grow. >> what role will acquisitions play in the future? you have but three companies in the past year? >> yes. they are all technology

companies, all someone startups that we enable. i am proud of the work our technology team does. the fact that we can embrace the silicon valley, silicon alley companies, integrate them, there is a technology business. it is not a payment business, this is the technology industry. to be the chief information officer at j.p. morgan. it makes me wonder, you have got some best in class technology guys working for you. if they were still at j.p. morgan, would they have suffered so badly from that hack attack? company,an is a great i love them. jpmorgant is citi or -- >> would they have been more vulnerable? >> there is a ton of talent there. you have to think about how many people make great things happen in that company every day.

i think hack attacks are real, they are happening everywhere. >> including an first data? >> we spend every day working on cyber security. two years ago, leon panetta stood up and called it warfare. he said it is by air, sea, ground, and now cyber. i was at the dinner when he did it. i think it is real, defense is all you can play. you have to protect the perimeter to sell the interior. everybody is working hard. lots of talent in every institution. your institution, too. >> indeed, we are. good luck with everything you are doing. the ceo of first data, runs one of the worlds largest image processing companies. >> excellent, thank you. --will be coming back to you

day forthroughout the more exclusive interviews. of course, you can see us on bloomberg.com and on your ipad. >> we are also streaming on apple tv, amazon fire. we are back in two moment. ♪

>> when we return, the rise of the digital currency. what it will take for bitcoin to go mainstream. gap, and now republicans try to bridge and other that has hurt them in the past. >> stay with us. >> the mustache gap.

♪

>> live from bloomberg headquarters in new york, this is "market makers." with erik schatzker and >> welcome back to "market makers." >> i matt miller >> a shout out to our producer. "market makers" during commercial breaks is a special treat i am sorry you do not get to enjoy at that moment. we were live on air. wereank god we not. looking at a future of money.

how new technologies are changing the way we pay for everything. one of those technologies is bitcoin. moneychatzker is at a 2020 conference in las vegas. talking to three people behind the bitcoin boom. >> the only thing as big as apple pay is bitcoin. we put together a panel, the kings of bitcoins. jeremyite of coinbate, of circle, and nick of blockchain. blockchain has been seeing record traction. we are seeing more and more a dailysing bitcoin on

basis. despite the fact that the price has dropped a little over the past few months. we dodo not look at what as providing a while it. we think about providing a consumer financial product. and usean store money it for payments. people use the phrase wallet because it is associated with what you have in your pocket. we are trying to do products other products consumers use on a day-to-day basis. is a first application, we will see a applications over the years. you will need a digital wallet to hold that bitcoin. beyonddo you get bitcoin its fringe appeal. how do you get more people to want to use it as a currency? we want and developers, api andneurs to use our

built products with bitcoin. a monthunched about ago. it is interesting to see the kinds of users. and a lot of the design for cervical after we moved from early adopters to mainstream users. and a lot of users are still early adopters. think mainstream use is using value --or its utility secure, instant, global, free payments. we have not seen a shift. >> why? factors.are a lot of price volatility is a huge factor. i do not want a spending money account where the value is changing by the minute or the day. interest-rate -- industrywide they are trying to address that. but that is a barrier. obligation to

make better software. we've made improvement over the last year. was ones ago there bitcoin company at money 20. last year, there were six. this year, there are over 20. 16-year-old kid who built a service that helps reduce the volatility of bitcoin by locking it to other assets. these people are not thinking too dimensionally. there's a lot of exciting stuff. what is exciting to me, a reminds me of the early web. these are open technologies. perate onn open o then. that is a fundamental shift in payment systems. have been closed and run by governments or global corporations. that is not the way the internet rounds. is built on free

intellectual property. anyone can participate. it is a very democratic ethos. bitcoin brings that to the financial system for the first time. of the beautiful things about currencies is that they trade in a market. driven other market instruments like stocks, the last price paid is a report card on the value of that product, whatever. the price -- i look at the price of bitcoin as a report card on his prospect as a digital currency. >> we try not to focus too much on price. >> it is an obstacle to mass adoption. >> there are certain companies that have removed the issue. went to receive the payment because it is low cost

but they do not want to deal with volatility. we have services that sells the bitcoin when they receive it said they are not exposed to the currency risk. in thee are companies u.s. and europe trying to reduce those risks. we are seeing traction in emerging markets and frontier markets. bitcoin provides an opportunity. >> important to think about its prospects outside the u.s. or europe. we are focusing on international markets. >> what is the biggest threat to bitcoin? >> there are a lot of challenges. scent a really na technology. people have a lot of expectations. needs improvement in terms of scalability to support the scale

of transactions and commerce that people want. important that we be patient with the technology development before we get too far ahead of ourselves. >> i think regulation is one of the biggest threats. we are seeing new york say how can we develop regulations that does not stifle innovation but current standards. that is moving in the right direction. lawsky is going to be here. do you approve of what he announced last time -- last night? see where that legislation goes. we want to seize thoughtful legislation -- we want to see thoughtful legislation. some companies are building others areks, building software. there needs to be a distinction. >> i agree. i think regulation in new york or any other country is nascent.

everyone is watching to see if there is a framework, is it the right framework. >> you used the word "free." once bitcoin has to adhere to anti-money-laundering regulations and terrorism finding regulations and the cfpb gets involved -- >> there is a difference between venture companies that are building financial intermediate services and people innovating on the software like blockchain ./ to the that.l in a world of open intellectual property that people are able to continue to do that. the regulation does not change that in theory. if i'm a developer in a dorm room and i went to improve that,n or build on top of i do not need a license. that is critical. that is different from other

payment systems that are very centralized. >> a quick survey. do any of you get paid and bitcoin? >> my entire company gets paid in bitcoin. >> i do not get paid in bitcoin but i regularly purchase bitcoin . a large part of my paycheck in bitcoin. >> what percentage of your lives to you conduct in bitcoin. >> i flew here on a ticket paid for with bitcoin, i paint my landlady in bitcoin. >> anytime i need to pay someone, i pay in bitcoin. babysitters, allowances, all kinds of stuff. ,ny time i have the opportunity i do. if there are merchants that have it, i use it. >> i force bitcoin upon all my friends. >> you would love these guys. bitcoin not just as

entrepreneurs but in their personal lives. nic, 100% paid in bitcoin. babysitters in bitcoin. it is happening at money 2020 in las vegas. bitcoin panel, back to you. >> i have a hard time finding a nanny willing to be paid on the books. >> you don't have to pay them on the books if you pay with bitcoin. >> we are going down to a bad place. commercial. has want to point out erik an interview with benjamin lawsky coming up. very important to bitcoin. as well.coin stay tuned. we will talk about masters of the digital domain. in politics it has been the democrats' turf. republicans have learned how to use computers, i guess. >> they always knew how. back with more "market makers"

in a few. ♪ ♪

>> welcome back to "market makers." last-minute calls maybe on the republicans' side. one thing has them worried, technology. the democrats to have perfected using technology to get out there that. the gop is trying to match it. -- philnly took a look mattingly took a look in north carolina. >> speaker tillis should be ashamed. >> millions of dollars in tv ads. t may all come down to the guy and a nap on his iphone. >> we appreciate your support. we are probably getting a little annoying to people. we've got to make sure people

get out and vote. people say they do not like phone calls but it works. volunteer forld the republican party. a state that is deadlocked between kay hagan and thom tillis. thousands of volunteers from both parties trying to get voters to the polls. he knocks on doors, he makes is an everyday test case for whether the republican party's technology investment is working. >> we've opened a number of sources we are using to collect data. it is more important how we act on that. republicans lost the data wars in 2012. there is hope their tech trees and may pay off. call, you having to can go as you please. the app makes canvassing easier.

>> a paper walk book was the old way. whereical book information had to be manually updated. a far cry from real-time data. it shows our location and tells us to walk down the street. what we are supposed to say and how we say it. >> each visit produces new data, that influences decision-making. the voters update the canvassing list. >> whatever they answer, you are going to put that in. it is going to put it into the system. it will take them off the list. investingrats heavily, whether democrats are working on the best information may be the difference. there is a tried and true way to find out. >> our work will be judged by how we do at the polls. >> phil mattingly from washington.

great having you here. are these volunteers really enough to swing an election? with a down the street suburban guy and an iphone does not feel like it. are so close. when you think about the money comedys been dumped in tv ad market is saturated. the debates are over. able toe the people turn out base voters for each party. what a democrats did so well and 2012. it matters. republican billionaires be spending all this money on traditional tv ads or should they funnel some of those dollars into embracing the next generation of the rocker s? parties have recognized the need to spend millions of dollars on technology.

in two thousand four, the republicans were way ahead of the game. recognizedfter that they needed to dump money in to change the dynamic. that has paid off. you are seeing republicans try to match them. right now they feel like they are in a good position. >> thank you. tomorrow is a big day. i will be watching bloomberg politics. phil mattingly from d.c. we will be back in a few. you are watching "market makers." tomorrow, stay with us. the election all nighter with mark halperin and john heilemann. tomorrow night at 7:00 p.m. ♪

>> that is it for "market makers." >> it has been a pleasure. >> tomorrow it is going to get more exciting. erik is in vegas. two guys, cameron and tyler link of us. talking about their back on bitcoin.

>> they have an etf based on bitcoin. straight is taking you to the markets after a quick break. it is almost 56. >> thank you from "market makers." ♪

>> 56 past the hour. olympic is "on the markets.z"

stocks fluctuating between gains and losses as in october consumer demand. the dow coming off its biggest weekly gain since january 2013. the s&p 500 recorded its best two-day jump in three years. joining me for today's options insight is jim, derivatives strategist at an km holdings. let's talk about the action we are seeing in the options market. >> i think investors have not shapedhe phrase v recovery as much as they have over the last couple weeks. it has been violent for equities globally and certainly in the u.s. 8.5% percent since the october 15 lows. our framework is on the volatility side. we think there's room to run.

this was the most intense volatility we've seen since 2012. it is going to continue to unwind. if you think about spot vix, it has not even got below 14. it's implied volatility is elevated, realized volatility is elevated. volatility metrics have a ways to unwind. as much as stocks have moved up, we think there's more to run. >> does it surprise you that hedge funds had a ton of cash does itugh october -- surprise you that hedge funds had a tough october? will cause yous to miss both ends. unless you are fully hedged going into october, you've got dinged up. what happens if you that l--

got less net long. even the smartest investors get tripped up. >> november to january 10 to be better for volatility and finding better opportunities. you have a play on aig. what are we seeing? aig reports earnings after the close. a fair amount of option activity of the last five days or so. it is heavily biased to the call side. the market is implying a 2% move. it is a big hedge fund name. this could be people with good intelligence to have followed this closely. implied volatility relatively low. and they want to position long directionally, out to january with stocks around $53. they are bidding up to $60 strike call. some players see a fairly significant upside in aig ever the short term. >> up from 4% this year.

we also have alibaba reporting as well. is going to be the first time in six weeks since they've gone public. we will get a snapshot of what is going on behind china's largest e-commerce company. are you expecting a strong result? high on the street price target of $125. a lot of moving parts. we want to be a little cautious on earnings. if you look at six of the ipgest internet related years including facebook and twitter, on their first earnings as a public company they traded down 13.8% on average. the worst was twitter, down almost 24%. the the last several days, firms involved in the ip a iposaction -- the transaction -- >> they've been able to start

rating. 85 putcalls, buy 95 spreads. commit to selling 10%. that protects the downside. >> interesting stuff. $100.5 is very bullish. it is a high target price. >> it matches the high on the street. >> big earnings day tomorrow. thank you, jim. "on the markets" again in 30 minutes. "money clip" is that next. ♪

>> welcome to "money clip." together the best stories, interview, and video in business news. richard branson tells me there is no fundamental flaw with his spaceship that crashed. the virgin galactic founder valves to push on. tighton day races are that it looks like republicans happy age. the future of money is more than just apple pay. we look at innovations in digital payment and sweden's dream of going cashless.