attention. i do not know if it is superlative. >> fascinating stuff. we'll figure out who is right toward the end of this month. we are on the markets again in 30 minutes. next.t makers" is up >> live from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> this is one wild ride you cannot shoot with a go pro -- shares of the company action sports fans love are taking a big dive today. >> next up for matthew mark, -- the big house. he has been ordered to start serving a nine-year prison term, convicted in the biggest ever insider trading case. >> call them the ultimate smart glasses -- the first government-approved device for the totally blind.

we will show you how second site actually works. "ou are watching "market makers on bloomberg television. >> i am stephanie ruhle. what are you most excited about? >> i want to see how these classes work. the blind.sight to >> i make fun of google glass -- i say what am i going to do, but imagine what this company does? we will have a guy that had not seen his wife in 35 years. >> until the put these glasses on. >> amazing. we have breaking economic news in the housing market. mia saini is at the news desk with more. >> we do have breaking news across a terminal. the first, as it pertains to the philadelphia business outlook, coming in at 40.8 versus 20.7, extremely bullish. paid, and the

employment index -- these are employment figures. investors care about this report because it gives you a good sense in terms of indication in of tri-state area in terms the polls for manufacturing and business reports as well. it is delivered before the end of the month, so it gives you a sense of the usually followed pmi number, a precursor of that. we are looking at existing home sales for the month of october, million.5% to 5.6 2 the survey was 5.1 5 million. the monthly report that follows the sales, it has closed. a leading indicator. a strong home sales gives you a sense of what it means for those looking in the retail sector to update their homes and the overall also the consumer. >> punchline, philly killed it. had out there and get a cheesesteak. we will broaden this

conversation and take a deeper look at the numbers with bloomberg senior economist, a new member of our family and a former colleague of mine, carl riccadonna. and our own economics editor, michael mckee. >> welcome to the neighborhood. >> philly fed. >> it knocks your socks off and the economy is doing well. people will be marking up their forecast. q2saw upside surprises in and q3, and we are on track for that thank you4. -- in q4. >> and underwhelming data for the empire manufacturing survey. >> i will take the net impact. the manufacturing sector is doing just fine. >> these are sentiment indexes,

and they are based on month-to-month executives feelings and i wonder how it is related to the big drop in energy prices because it is not just good for us at the gas prices come -- gas pump, but everyone that uses energy to produce products. a qe 4 fromtting saudi arabia in oil prices. it adds up. >> the philly fed number is the highest it has been in over 20 years. it is not like saying we are back to 2006. we have not seen this number since 1993. what you make of this? we have to discount -- >> we like overenthusiasm. >> it is still a great number. they do we are finally breaking out of the doldrums. is too sober for me.

>> he sounds like an economist with the three-month moving action -- average. but you know what will happen, the number will come down, and everyone at the trading desk will think the world is coming to an end. >> what about new home sales for yesterday -- excuse me, existing home sales. >> it is surprising. we have not seen credit loosen up all that much, and we have seen interest rates rise just a little bit. we are not seen big levels of household formation, so demand has not been great. the fact that we can eck out a game show you the economy is a little better. nonfarm payrolls -- i think we will hit that again in november -- that kind of job creation will create the demand for housing. we have seen week household formation and all of these

things the last couple of years and through the recession. a strong labor market will be the determining factor for housing in 2015. >> here is a good point -- we see people getting a break from gasoline prices. they feel a little bit more wealthy. they also get a break because house prices have recovered. home prices are getting back up to closer to where they were at the peak, which means your equity is going up. >> sure. only 10% of the homes in america are underwater right now. but the thing that has been missing so far is the -- >> the thing that has been missing is the spark, the animal. for people to go out and spend. , based on theonna philly fed, and everything else you have seen, there is still a sizable amount of people thinking the economy is growing at 2%. what you think it is growing at? >> i think we have been stuck at

the 2%-type of pace, and we are on the cusp of breaking out, and people do not realize it. the headlines are not being taught in mainstream america, we are on the cusp of a change. the housing story is relevant. the gas story is relevant. >> the biggest risk? >> anything that stalls job creation. job creation, without a doubt, is the linchpin for the economy over the medium term. >> carl riccadonna, welcome to bloomberg. >> awesome. >> let's not forget about economics editor michael mckee. >> i am glad i am here. >> not chopped liver. -- share to watch, so proud they have a secondary offering of $11 a share, 70% lower than yesterday's close, and the executives, including the ceo are the ones dumping the sales. bloomberg west editor-at-large, cory johnson, in san francisco.

i think you would be the worst go-pro shooter ever because if you were in the gopro, you would be shooting a lot of nothing. be nothingk it would because i am six foot five? i have shot a lot. it is a camera on a stick. it is a cool camera on a stick, but the secondary offering illustrates the issue the companies -- the company is having in the public market. there is a limited amount of float out there in terms of the number share that are totally existent in this company as opposed to those who trade. as much as half of the float was trading every day this week. it was really weird. then the secondary offering comes and it comes priced so deep in the hole. the stock was trading $85 yesterday morning. the secondary price was $75.

they were willing to share 10 million shares at $10 below the price of the stock. they were desperate to make this deal. this is not the kind of thing you'd see a lot, and the stock reacting as a result. the stock down from the secondary price. i think it is worth noting that the ceo himself is selling about 40% of the deal today, getting out of his shares. of course, the rank-and-file are locked up and cannot share -- sell shares. >> what is the message to board of athat the publicly traded company would be willing to ram through this deal at a $10 discount to market? >> there are a lot of reasons to sell, or the one reason to buy, thus goes the old adage. you would understand why he wants to take money off of the table because it is a lot of money. the other old adage is if they

are willing to sell at any price, it is not a good sign. pricing this deep into the hole suggests the time to get out of the shares was right now, regardless of if it was $85, $75, or something else. >> is the cause for alarm, the price, or that they are selling -- we see a lot of insiders sell once the moment comes. >> sure. this comes close on the heels of the initial public offering and selling 10 million shares -- they were hoping to raise as much as $900 million. now we're talking 780 million dollars. the company is only selling about one million shares. i think it shows they felt it was the time to take the money off of the table. this is been a hot stock. trading this week has been remarkable. the value has doubled. it was already very high.

it was trading 8, 9, 10 million shares a day, half of the float, which is uncommon for any stock, let alone a stock so close to the deal. it was a lot of people betting on where this price would go, whether they were off to the races, already for a collapse. , icori, i love my -- cory hero three, but you said it was a company that makes cameras. what about trying to reimagine themselves as a media company? >> that was a story on the roadshow, at the analysts have globs onto -- it is not just a camera maker, as i said, a camera on a stick. there is more to this thing. i did not understand that story. if they create a channel for gopro videos, it does not mean

videos. the if i shoot a video, i own the video. i realize bad news sells more newspapers than good news, but we need to note the stock has done very well since the ipo. >> what is a newspaper? >> sorry. they have had a great run. >> actually, the stock has more than doubled since the ipo and there is a lot of excitement about the deal because they are showing good topline growth than it is a profitable company, but i think there is a notion that our prospects for a media company. it does not matter what i think, but there is no revenue, not a penny, from media in their four-year report. they do not have a cash flow-your report. they do not have a breakdown -- full-year report. they do not have a breakdown of media.

it was greatly goosed by the limited float, and that all changes today. the float is not as limited because there are 10 million more shares out there. we willgreat goosing, leave it there. >> we can count on you for a great goosing. >> cory johnson, bloomberg west editor-at-large. >> are you tired of paying big fees to money managers? how would you like to name your own fee. we will see if this is more than just a gimmick. >> i do not see too many hedge fund managers offering that soon . giving the blind another chance to see -- bionic eyes with the and one ofnd sight the patients we just saw his wife for the first time in 35 years. ♪

>> first. bloomberg. >> i am erik schatzker with stephanie ruhle. no investor likes fees. into returns, but a new

online investment firm is putting that issue to rest, allowing its client to name their own fees. is this too good to be true? let's ask the aspiration ceo, andrew. >> it works by trusting customers. if we do a good job for customers, provide good results as a firm in terms of the kind of values we live by in terms of our company, they will pay us a fair price. >> a lot of faith in human nature. >> like a tip jar? vix in some ways, but it is our bread and butter. >> in someways -- ways, but it is our bread and butter. if we tell them here is the average, they will do the right thing if we do the right thing by them. >> we have spoken to a number of investors who charge hefty fees and in our opinion, you get what you pay for.

among the best, david tepper, bill ackman, they say you pay or you do not get in. what does it say about the investment professional if they say we do not worry about the fees? >> we are not saying it is free. you believe you pay what you get for. we hope we are providing a great service and doing great by our customers. we believe if we do so, we can trust them. you have a financial system where nobody trusts the people doing business there, so we are breaking through that. we are taking investment outlets to everyday investors that have been left out of the casas and have not had financial firms focused on them, their needs, and their future. we believe if we do that, people will do right by us. we take $.10 of every dollar and apply it to charitable giving. we believe there is a group of customers out there looking for something different -- an investment firm with a conscience, an investment firm for the middle class. >> who are these people, and what are you selling them?

>> everyday, middle-class investors that have not had an investment firm working for them. 20 years ago you had smith barney, there was a dean witter in every sears in the country. those kind of firms have disappeared. for some of the same reasons we do not have sears all over the country -- technology, business changes. we are creating a firm that focuses on everyday, middle-class investors. >> what about a firm like america rise -- they focus on the mass affluent, or even less, the middle class. >> some firms are touching aspect of this. is $500mum investment and we have a $100,000 maximum investment, so we focus on middle-class, everyday investors that are being left out. >> so, for you to keep the lights on -- even if what a lot of what you do is online, you have to have a lot of customers. >> absolutely. >> at the maximum investment is

100,000, comedy customers do you need at what average aum? >> we have to build a customer base among the 36 million mass affluent customers out there. >> how many do you need to make the company profitable? >> we will not discuss the exact numbers. >> just an idea for how big the scope of this needs to be? >> we are going to be building something big, and whether that is tens of thousands, hundreds of thousands, that is what we are trying to build. >> i am guessing when you need to sell is the quality of your investors, so the investment professionals that work for you, who are they, what is there pedigree? a number of firms. the flagship fund is through admiral asset management out of pennsylvania. a great group of people there.

we will use a lot of sub advisers to manage different investment products and financial products. >> what kinds of stuff -- there are a lot of products available. there are thousands upon thousands of mutual funds, hundred, if not thousands of etf's that ordinary investors a discount to via brokerage at a fairly low cost. you clearly have to be giving them something different than they can get on their own. >> everyday investors are almost exclusively invested in equities and traditional long-only mutual funds. our first fund is a liquid alternative fund designed expressly to bring down the ofatility for the portfolios middle-class investors. volatility has a disproportionate impact on everyday investors. fund. liquid alt >> there is a range of strategies, long, short, event-driven, etc.

there is an animated game called "it is a volatile life." it really shows people why volatility as a real impact on everyday investors, who when they are losing a big chunk of their portfolio, it is often the same time they are losing jobs, homes, or retirement benefits. >> what is regulation look like for you? i am guessing to set up a business like this, there has to be a lot of regulation to get through and that is expensive. >> absolutely. we embrace it. >> i get that you embrace it. how do you afford it? >> we have a great group of investors that believe people need something different in this space, that people need an investment firm that will be on their side. they have backed our company and in whatwhat we are -- we are doing and they think this is the financial sector ripe for

disruption. >> andrei cherny, thank you for sharing your story with us. the ceo of aspiration. " -- we will bers back in just a moment. stay with us. ♪

>>: welcome back to "market makers." it is 26 minutes past the hour. bloomberg tv is on the markets. partner, taken away. >> it is all about william simona. they are killing it today. >> government holiday barks -- it is delicious. >> they are killing it -- a number of reasons. earnings and sales came out way out ahead of analyst

expectations. same-store sales at west elm, which is owned by williams-sonoma, as is the pottery barn, up 17%. category killer. >> do you like westbound? >> yes, great valley. -- do you like westbound? ♪

>> live from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. " here on"market makers bloomberg television. i am erik schatzker. quicktime stephanie ruhle. big day for matthew mark,. he is the trader convicted in what prosecutors say was the biggest insider trading screen -- scheme ever and it nearly brought down his boss, billionaire steve:. callclock are -- sheila hell tar has been on this saga from the get-go. moment.is from the

he is going to the clinker. >> they have exhausted every single avenue, and frankly, heroic effort to put this off, an emergency appeal to stay out of jail. that was turned down the same day. >> heroine, or desperate? -- heroic, or desperate? mike simon surprised at the resources. >> he is a smart guy. how else would he have ended up working for steve cohan? >> how did he have that much money? when you need to hire a lawyer for anything, it costs a lot. this had to have cost him millions of dollars. >> yes, the firm, as is their policy, was paying for legal expenses to a certain point.

it is not clear, since his conviction, who is picking up the tab. it is possible he is still paying, but they are not obligated to pay. >> where is he going to prison? >> he is going to a minimum security prison near miami. the pictures look lovely. >> hold on -- that is the prison ? >> it is a minimum security prison. a prison camp. the weather will be nice, though he will be separated from his family. he has three kids. correct he has three kids, but when they get to visit -- >> he has three kids, but when they get to visit him, let's show the picture. there is a daddy-daughter dance. do not cry for me, matthew martoma. >> keep in mind the crime he he was convicted of -- it was not a violent crime or predatory -- it depends how you define auditory.

>> that is -- predatory. >> that is right. he is going with other white-collar criminals. he will not be with the murderers at rikers. >> man well-known diego served time at this -- man well-known at thisrved time institution. >> guessing will not be serving en, back on the scene. >> his company has been doing things to show the world anything is on the up and up, and they have been plotting a comeback. he on a $100 million jet .ommittee sculpture his returns have been good, though he is only managing his own and his employers money. >> he is only managing his own money. poor steve. >> he is talking about an advisory council.

that would perhaps lend it some credibility. >> that is what fascinated me most -- the notion that he could possibly manage money for the advisers that he recruits. , they this one more time agreement prohibits him from managing money for outside investors, but there is a loophole, potentially, where he could create an advisory board and then manage money for those people because they are part of the family. would he want to? why not leave well enough alone? how about manager a billion dollars -- ot toybe that is the carr get a big name on the advisory board. >> does he really needed? -- need it? >> why does he manage money at

all. >> eight could retire, but his reputation is important to him and he is taking steps to clean that off, show everybody that he is back. i have heard, frankly, that he is talking about some kind of comeback. >> there you go. not count him out. look at his returns. it is tough to be a steve cohen naysayer when you look at his returns. rain or shine, the guy crushes it. >> he has been making a lot of money. even with the loss of talented employees -- he has people spying on his employees to make sure no one is doing anything wrong. he is clamping down on what the employees can do, and you could argue people do not want to work there, but just on his own steam he is generating billions of dollars. to bethew martoma as banned from the industry forever, correct?

>> i suppose one day he could reapply. >> he could change his name a fourth time. i am just playing. sheelah kolhatkar, thank you so much. he has changed it twice already, hasn't a? >> i think it was want. >> who is counting. thank you, sheelah kolhatkar. >> when we come back, here is a question for you -- what was it like to see for the first time in three decades? we will be speaking with a man who has a bionic eye. >> pretty amazing. ♪

♪

>> just a few years ago, it was nothing more than science fiction -- bionic eyes that let the blind see. today, they are a reality. in one case, a man saw his wife for the first time in three decades. the company that makes these bionic eyes went public yesterday. second sight. ceo,us, the second sight robert greenberg, and hamdi , the man--larry hester they regained his sight. larry, tell us what it is like? >> it is incredible. then,ars, no vision, and 33 years come and

no vision, then this light comes on. i see flashes of light. before that it was nothing. even though it is basic and elementary, it is flashes of light, and that means i can see something. >> larry and i want to share with the audience the first time you got to see your wife after 33 years. we have the video. >> what can you see now? >> nothing now. >> everybody ready? 1.2, click can you see, -- >> can you see, larry? goodness, can i give him a kiss? >> did you ever think in your lifetime this was going to happen? >> no way. not in my lifetime that i ever dreamed it would be a medical breakthrough like this and how fortunate i am.

it is incredible, and what is even more exciting is what is coming in the future, and i firmly believe that second sight is working diligently to make -- i firmly believe they are going to restore sight to blind people eventually. >> bob, is that possible? >> absolutely. there is a good example of the technology we are able to do today and the patients we are able to help. we are going to do additional research and development and expand this to all forms of blindness. >> how many cases are there like this that have already been this successful. >> we have had 90 cases and the results have been similar. >> what is your realistic goal -- you will raise this money, what do you want to achieve realistically?

locks with his fundraising the plan is to get to several important milestones -- >> with this fundraising, the plan is to get to several important milestones. the device is upgradable, similar to an iphone, where you can upgrade the software. our plan is to get new versions of software in larry's implant. >> what larry has, you are saying you want to improve. >> absolutely. we are on the 14th version of the software, and we will keep going with that. >> tell us how it works? >> there is a video camera in larry's glasses and information is wirelessly transmitted to an implant in and around his eye. once the implant is in, it essentially becomes part of his eye. you cannot tell it is there, and he cannot feel it. >> this is for a specific type of blindness. how broad is it?

how many people can it affect? ,> it is approved for a disease and there are about 100,000 patients in the u.s. with this retinitis. trial forclinical macro degeneration, and we are version -- working on a version that we believe will be able to treat all blindness. >> people go blind for many different reasons, but so long as you can tap into the optic nerve, it does not matter how, for the most part, someone lost his or her site? >> for the most part, it can only treat retinal diseases, but for the next version, -- >> you can go directly to the brain? >> correct. >> how much does this cost? asked the device in the united 100es is a little more than $45,000. >> does insurance cover it --

$145,000. >> does insurance cover it? >> some of it. >> is the technology available to other deprivations? to make oculared implant for the death. --deaf. f. dea it is an extension of that idea. >> why go public? why weof the reason is are sitting right here -- get the word out for other patients and the people know about the technology. >> are there other patients like larry that simply do not know about it? if i were blind, i would be into what you are doing. >> we had about 1000 patient calls directly when it was announced and larry might have been one of them. >> larry, what is your story -- how did you find out about this?

>> well, reading through the newsletter through the foundation fighting blindness, he it said the fda -- it said the fda had approved a device that sounded exactly like for me, retinitis pigmentosa, and it seemed like i met the criteria, so the next day i called second sight, talked directly to them, and indeed they said it sounds like you will meet the criteria. >> did you think this would ever happen? take us from when you first read the newsletter to today -- did you read it and think i am going to be seen my wife in a few weeks, or was it so far off? >> it was not far off because gary at second sight said we are moving on this, setting up sites throughout the u.s., and we will have at least 13. it is coming. you might have to be patient, but we will get back with you, and certainly within a year and a half, it all came to pass. i had mine at the duke eye

center, and it has been incredible. >> bob, i do not want to trivialize and anyway the work you are doing to help patients like larry, but is it possible the technology you are developing could be applied to other industries -- again, not to trivialize it, gaming? >> for me, personally, one of the inspirations was steve austin and the bionic man. >> really? >> we obviously a long way from doing that, but direct interface is probably in the future. >> probably quite a ways. bob, thank you so much. >> congratulations. >> amazing. >> larry hester. >> amazing. >> it truly is amazing. >> thank you so much. what an extraordinary conversation.

>> i am glad i do not sell bonds anymore. this was just about the best thing i have ever exist -- experience. coming up -- you have to do it. small thingse speak volumes about the economy. hotcakes -- are they still selling like hot cakes? ♪

>> welcome back to a really great day here on "market makers ." you know the old saying, "they are selling like hot cakes?" here is a thing, hotcakes, whatever they are, they are not selling any more. kyle wrote about it. what exactly is a hotcakes? debate -- some say it is a standard pancake, and others a pancake made with cornmeal. recipe.an old time

>> where do you buy one? one -- certain items on a menu like mcdonald's are called hotcakes. you will find them. it is a matter of phrasing. >> the pancake is a subset of the hotcakes or vice versa? somethink vice versa and say it is a regional thing. >> how are hotcakes selling? >> not too well. >> i think it is a gluten-free thing. >> or a healthy thing. sayne-third of americans they are trying to cut gluten out of their diet. >> i am not gluten-free, but when there is a good egg option, i do not go with the french .oast or pancake, i go egg

>> how about you? >> same. >> i like my bacon with maple syrup. >> to think selling like hot cakes will leave -- i do not want to say the english language, but will we say banging like burritos? >> it is fun to say. it is a metaphor. >> do you say it all the time? >> once in a while. i thought about it. i will not save any more. >> what will you say? like kale.it >> i would hate if selling is like quinoa became a phrase. it is hard to buy. where do you find it? >> lots of places. >> i knew he would say that. >> bacon -- selling like bacon.

>> no, it has to be alliterative. make it catchy. >> there is a recyclable grocery yeah."t says "oh, kale >> get it started, stephanie. stick around. there is an interesting study -- here we goow -- and -- how likely bankers are to cheat and lie. one group of bankers filled out a survey about their personal lives. the other answered questions about their wall street career. they were told to flip a coin 10 times and guess how it turned out. for each correct answer they would get $20. researchers told them they were on the honor system. guess who cheated -- the ones answered questions about their personal lives save a guest 51.1% of the tosses correctly.

those asked about the career claim to have 158.2% of the time, which is basically statistically impossible. people love to hate on bankers. what you think of these results? >> they speak for themselves. i do not know enough about the data so i have to assume it is statistically sound, large enough sample size with a small enough margin of error and 58% really is close to 58%. if that is the case, and it is truly random, maybe bankers are bad people. >> or maybe good people and up in a industry that turns them that. whether you- started bad or became bad, you are bad. >> but if you're asking them butt the personal lives, the settings -- >> hang on -- guns do not kill people, it will kill people.

-- people kill people. confident is a huge asset and bluffing is huge. when they are in a professional mine said they are in this persona where they take chances. what is the mantra -- risk equals reward. >> you are right. he is right. >> i think he has a great point. -- i am asking him what his personal expenses on -- personal friends, friends of the family that work on wall street in finance, more or less trustworthy than your average joe? >> i would say it is based on the context. whether they are talking about a or -- ip >> would you trust them with your money? >> yes. >> wall street is filled with bravado and ego in in a situation like that they will push a little because they want to seem like a -- the man.

>> on a survey in -- on a piece of paper. >> tile stock. we will be back with more. ♪

>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> warning us about cars that were unsafe at any speed. the does he say about millions of potentially dangerous airbags? >> the battle over immigration is about to be joined. president obama lays out his plan on national television tonight. republicans are poised to attack. >> this entrepreneur is not singing the same old song. a con is headlining a big innovation conference in morocco.

to "market makers." >> it's 11:00 in new york city. these are the top stories in business and finance around the world. another sign of strength in the housing market trade existing home sales rose to a one-year high last month. that is the fifth straight month the annual sales pace was more than 5 million. for the 10th straight week, the number of americans filing for jobless benefits remained below 300,000. third quarter buffet -- profit beat in the lists' -- analyst's estimates. another setback for the shrinking gambling industry in atlantic city. brookfield property has dropped plans to buy a casino.

brookfield could not win a reduction in electricity payments, and that submarine the deal. jack my has a warning for alibaba investors. alibaba's cofounder says this is the most dangerous moment for the chinese e-commerce company. ma has previously warned employees about being complacent and failing to innovate. the weather is bad and getting worse in western new york state. there could be seven feet of snow in some areas before it stops tomorrow. the new york police closed the new york freeway. there is going to be another big problem, flooding. is going to be speaking to the nation tonight. the topic is executive orders to overhaul the immigration system and protect millions of

undocumented immigrants from deportation. republicans are furious about what they perceive to be an end run around congress. phil mattingly is in d.c. this morning. does the speech prove that for the president right now in his last two years in office immigration is his top domestic priority? >> for his second term, it is fair it is to his domestic top hisrity -- it has been domestic top priority. believe thisthey is is a culmination of two years of work either scenes. they were blocked on capitol hill by house republicans. out, republicans strongly agree with this assessment on things and they will fire back in a big way, starting tonight after this speech. >> what does the republican

party believe is the smartest approach to challenging executive orders on immigration? >> it depends on who you talk to. this is the problem, the dynamic they are having a difficult time figuring out. you have sent to republicans about to take control of the chamber in january. you have house republicans who will stay in control. the establishment side of the republican party wants to be able to show they can govern. they don't want to do anything that would lead to a shutdown that might alienate the hispanic vote. segmente to deal with a between 50 and 60 lawmakers in the house who are willing to do anything to push back on this, that includes trying to block government funding bills in the middle of december. there's a lot to figure out right now in the republican conference. they are going to push back. how they are going to do it, no one has really coalesced a guard -- around it yet. >> 8:00 p.m., and addressed to

the president -- an address by the president used to be a big deal. you've seen the photos. tonight if you are watching network television, you aren't even going to be able to see this. >> that's true. white house officials are upset about that. they perceive what the networks are doing right now is a push back to how they rolled this out. yesterday they announced this on facebook. they did not give it to the press. a more or less try to go around the media. there's a plan here. that facebook address has rolled through more than 5 million facebook feeds. the white house itself constantly points out they are not necessarily going for the segment watching television at 8:00 p.m., they are going for people on their tablets, their phones. key point, they have made an agreement with univision, which will be showing the latin

grammys tonight, to push back the start of the latin grammys to show the president's 10 to 15 minute speech. even though the networks aren't showing, they will be able to hit that demographic in spades with how they do this tonight. >> phil mattingly. everyone, tune in tonight. the bloomberg politics team will have live coverage. hill, senators want answers about millions of potentially dangerous airbags. these airbags have been linked to five deaths so far. one victim testified at a senate hearing. the took my car to dealership for service three times after they supposedly received the information. the honda dealership never told me about the recall. ormed ther perf repairs on my vehicle and never warned me about what might happen if my airbags did not deploy. >> these airbags are made by the

takata corporation. more than 8 million cars in this havery with these airbags been recalled. the government is demanding more be recalled. nader made's, ralph a name for himself by drawing attention to car safety. bookdecades ago, his "unsafe at any speed" was a revelation to many. ralph is on the phone. you have been focused on automobile safety for so long, relative to everything you have seen, how big a deal is this takata airbag problem? >> cars and vans and trucks are much safer now than they were in 1966. this is a great safety device. air bags have saved a lot of -type, but this takata airbag, using a compound called ammonium nitrate, which is very cheap, is now presenting a threat.

in 20 million cars, at least. they have been stonewalling this for too long, and they are in deeper and deeper trouble, along with more and more motorists. takata knew about this in 2004. it knew more and more about it as the years progressed. has been stonewalling the department of transportation on the recall. it now has to recall at least 14 million and probably a lot more. thetragedy in this is that auto companies themselves did not do quality control and due diligence enough on their big supplier. the government and department of transportation did not be the watchdog it was supposed to be. the opportunity out of this is stronger legislation, to increase criminal penalties, to provide an adequate budget for the auto safety agency, which was disgracefully low. thatlso, to make sure

congress begins supporting this great effort of safety on the highway for millions of motorists. >> you mentioned that in your opinion auto makers and regulators failed or were toelict in their duty enforce proper standards when it comes to airbags. are they doing enough right now? are automakers taking this seriously enough? >> they are now. out of the bag. the auto companies have to look into themselves and see why their engineers and quality control specialists did not discover this problem with takata, their giant supplier of airbags. a real interest in this. they will be exposed to bad public relations, more costs, litigation. and barra, they ceo of gm

the head of honda and toyota, they have got to look into their companies and see out of their own self interest. they did not catch this year after year. >> what do you think of the new nominee to run ntsa? >> we don't know enough about him. all i know is that congress led by congressman john dingell, who is retiring, and the white house under both parties have been dampening down ntsa and our national auto safety, highway safety programs for years. that is developed a culture of passivity in the department of transportation, dealing with not the regulating for safety auto companies, but the suppliers. senator richard blumenthal and other senators have put in good legislation. i hope out of this tragedy will come reform and upgrade of the national traffic safety laws. first we have got to deal with

how is takata and other suppliers that must be brought into this area going to manufacture fast enough, up to 20 to 30 million airbags. takata cannot do it by itself. it doesn't have the capacity. the department of transportation has got to order an expansion to other manufacturers to get this job done, to protect motorists on the highway. >> is regulation the only way to go here? aren't some of the private lawsuits that as a result of tragedy filed against these automakers and suppliers also incentive to protect behavior? >> berry much so. is often ability first responder because there is political pressure to take it slow and easy. when they see these companies, the depositions, interrogatories, that material spills out for the media. when the media starts reporting

it, [indiscernible] start popping up. these companies, they should have independent ombudsman who can report to the ceo when they receive alerts from engineers and other people inside the companies who now are very reluctant to blow the whistle because they will be retaliated against or fired. what i propose to ceo mary barra, that that is what she does to protect the confidentiality of whistleblowers who wish to bring their conscience to work every day and protect the american people. >> good to have you on our show today. ralph nader is a longtime consumer advocate who has brought special attention to safety failures in the auto industry. sittingp, is your car around for hours at a time, not being used? now there is an app for that, and a company too. -- latest business for akon

we will talk with him in a few minutes. ♪

>> welcome back to "market makers." the peer-to-peer car sharing company get around is teaming up with a funding round to let people rent out their cars to complete strangers, either by the hour or the day. it is announcing its first expansion into the east coast market, washington, d.c. - is theus this ceo - ceo. is this the airbnb of cars? the sharing being economy, similar to airbnb. the airbnb of cars is a good starting description. one of the key differences is that we really make the whole experience very seamless and on

demand. all throughck it the app. >> who is a bigger competitor, zipcar or uber? >> we don't look at ridesharing, as competitive. they are quite complementary. they are pioneering the movement towards transportation from your phone. car, i think they have really pioneered the industry and pave the way for getaround. we are leveraging existing cars thatare out there today are owned by everyday people like you and me. >> let's say i own a car and i decide to do this. what is a going to do to my insurance? >> one of the things we do is include insurance in every trip, up to $1 million, it covers for

collision and liability. trip, our insurance -- your insurance is not in play at all. >> say that again? >> during a trip, we include insurance. that is primary auto insurance that covers for anything that happens on your car during the reservation period. your personal insurance is not in play. >> what is your experience been, with the way your customers treat cars? you and i both know that the people who get into a rental car don't treat it like it is their own car. what about the cars of people whom they don't know and probably will never meet? >> we have been very pleasantly surprised with how people actually treat cars. we have seen people leaving notes, leaving gifts. they are thankful they can get access to a car -- >> hold on.

you are pleasantly surprised until you are not. the same thing until somebody rents out an apartment in new york city and has an all-night blowout. >> which happens. >> i believe it was called a triple x freakfest. what happens when you are no longer pleasantly surprised? >> that is what i was about to get to. that is why we backstop everything with complete auto insurance. have a pier to feedback system that allows people to -- peer-to-peer feedback system that allows people to communicate. finally, we -- our owners tell us they know getaround is very supportive and will always be there to handle any scenario that might come up. worst-case scenario, tell us

the worst thing that has happened so far. >> for us, the worse things are always accidents. they involve people's lives, and people can get injured. these are things we take seriously. that is why from day one we have included primary insurance. share with us a few numbers. how many people are in your network? how many people have signed up to offer their cars through get around --getaround? >> we have hundreds of thousands of members who actively engage in getaround. thee we have launched instant experience 18 months ago, we have seen the business grow over 10 times. we have seen the amount of cars shared in san francisco increase in the past 10 to 12 months. do you do to ensure the

safety of the cars that are being lent out? let's say i own one of those cars and i need to get my brakes replaced. how do you secure against people like me? >> we actually inspect and ensure the quality of the fleet when we onboard vehicles. we are actively involved with car owners to make sure their cars are in good repair. that is something we actively manage and work with all the car owners on the platform. >> i want to know what kinds of lessons you are learning as the entrepreneur of a car sharing company. from what uber is going through right now. >> i think uber has pioneered a lot. for ms. firesde recently. from our point of view, -- maybe made some misfires recently.

from our point of view, we respect the privacy of individuals and reporters. >> how about attitudes? you come across as a reasonably mild-mannered guy. uber is a brash company. it lets the upstart label. uber is disrupting, and they want to be seen as disruptors. sam zaid of getaround ? >> i have a lot of respect for travis, but we are different people. frompproach we have taken day one was to work really collaboratively with both public and private companies in order to legitimize the whole space of car sharing. can i ask before we go, what is the average age of a getaround user? bit, buties a little for people renting cars, typically between ages 19 to 35. >> there you go.

>> sam, thanks very much. >> sam zaid, ceo of getaround. ♪

>> welcome back to "market makers toos." >> it is time for bloomberg on the markets. a surprise sales gain last quarter amid demand for higher definition tvs, fueling optimism

that the growth can be restored. >> the turnaround story, right? it is had some ups and downs. same-store sales are up. >> there you go. "market makers" back in two. ♪

>> live from bloomberg headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle. >> welcome back to "market makers." >> i'm erik schatzker. here is something. imagine being brought in as the turnaround guy to fix a public system that just lost $40 billion of retirees' money. that is what michael sabia was in 2009. sabia has different priorities for the $200 billion of assets, such as changing the way his money managers think

about markets and risk. he is here with us in new york. welcome. >> pleasure to be here. >> you made a remark a couple of years ago that caught my attention. longer amarkets are no good gauge of value. you have said it a couple of times, at least since. what does that mean? >> that means that markets are too focused on short-term. >> are they broken? >> i won't go so far as to say markets are broken. i will go so far as to say that markets are excessively focused on a short-term outlook for just about everything. the short term not the right way to assess the value of a business or project or whatever. toomarkets have become susceptible to the latest rumor, the latest short-term effort to maximize something. of all thetion

investors -- investors have become so short-term focused. investors today are more interested in trading than they are in building. what contributes to the volatility of markets. a long-term investor, our job is to look through that volatility to see the intrinsic value of the things we are investing in. >> and do what? >> choose the best companies, the best infrastructure projects , and invest in those. earn returns from those. focus on adding value to those. >> if investors in public markets like the stock market are afflicted by disease called you seermism, what do when you look at the s&p 500? what does that convey to you? >> a lot of things. if thethem, for sure, consequences of monetary policy and interest rates being where they are and the search for yield. ask yourself,e to

is that a reflection of the fundamentals of what is going on in the near-term and the world economy. partly, butld be substantially as a result of what has happened in monetary policy. for us, do we say that becomes the sole judge, the sole measure of value in our universe? >> no, it sounds like you are saying the market is overvalued relative to where it would be if it was trading on fundamentals alone. were trading up your fundamentals, it probably would not be where it is today, which is to say lower. that being said, the effect of monetary policy is a real thing. it's not part of where they performance of the world economy is today, but the consequence of monetary policy is not something that can be trivialized or disposed of. >> has monetary policy truly affected the real economy, or has it only affected the financial market? >> monetary policy has affected

-- monetary policy has affected the public markets. it has substantially increased wealth to the performance of the public markets and through that wealth effect it has caused, particularly in the united states, improvement in consumption and improvement in investment activity. it has had an indirect impact on the real economy in the united states. is it having the same impact in europe? no. the transmission belts between financial markets in the real economy is stronger in the united states given the structure of savings than it is in europe and certainly japan. europe,tive easing in in japan, is not the same kind of tool it is in the united states. >> or does it just not work as well? >> that's what i'm saying. >> you have used [indiscernible]

the word to describe approach to investing. why shouldn't a pension plan be more radical? you don't need liquidity like many other investors do. why not match all of your long-term liabilities to long-lived assets? some of the stuff you are already investing in. >> we are doing a lot of that. of we thinkg some the best parts of that kind of strategy and putting it together with other elements. if we put them together properly, we will be able to perform better. by way of example. around the world today we are looking for great infrastructure, we are looking for great real estate. today we are investing -- we have $50 billion in canadian public equities. it is all invested today in the highest quality platinum grade global companies.

that is the kind of assets that we should be invested in, and that's the kind of thing we are doing because it's perfectly well aligned with the needs of the assets that we manage. >> the assets you're chasing, is it getting too crowded? you mentioned commercial real estate.. blackstone is raising a new fund right now. the last one was something like $13 billion. do you worry that the prices are getting too high? >> prices are high. for an investor like us, we are interested in these assets over a 10 to 15-year period. estateat manhattan real price performance over the last 15 or 20 years. it is a line that goes like that. then there is a financial crisis and it goes like that.

for a long-term investor like us, i'm fine with that, as long as it keeps going over the next 10 or 15 years, that is the platinum quality we want to be invested in. >> what about hedge funds? not worth itit is to invest in hedge funds unless you can put 10% of your assets the fees andse of complexity and human resource it demands. do you agree with any of the rationale calpers offered for getting out of hedge funds? >> we have a very small allocation to hedge funds, a little over 1%. why do we do it? we are selective about the hedge funds who we work with. fundamentally, we do it because theives us a window into latest, most advanced thinking in the investment world. ourus to allocate 1% of assets to have that window, to benefit from the expertise so that we can feed our own

thinking and enrich our own thinking, fundamentally that's why we do it. >> michael, great having you here. >> thank you so much. an honor. --michael sabia >> he is the ceo of canada's largest provincial pension fund. >> do not go away. ♪

>> welcome back to "market makers." we have got some breaking news. capital, his fund originally was funded by blackstone, standalone now. he is standing up right now. dillards, he has 4.9% stake in

this company traded is a new position for him. calling for dillards to spin off their real estate business. two standalone companies. seen this before. according to this report they just put out, they believe the two separate companies' combined value would be 193 bucks cumulatively, a share. the releases is coming out of marcano capital -- marcato capital, urging the ceo and board of dillards to look at this proposal. this is not a proxy fight. nick mcguire is not asking for a board feed here. they are saying, here is our report. time to allot some value. is a tried and often for activist hedge

fund managers, urging companies that have a lot of real estate assets to find ways to recognize more value, monetize those real estate assets in a way investors can appreciate now as opposed to waiting for the market to come around to the idea. maybe i should bid up the price of the stock. separating it in two, department store business on one hand, real estate investment trust on the other hand, in theory would accomplish that goal right away. >> stock is up 3% today. this constructive activism. shot up 7%. style, i'm download going to make a video and tell you why the ceo of [indiscernible] is running his company incorrectly. another saying there is way to unlock more value. we have seen it before in these types of businesses. the question is, will the ceo listen. >> one thing must be said.

this is perhaps less aggressive activism than the kind we see from a poison pen rudderless -- letter writer like dan loeb. gone to the board and said, tell me what you guys think about this. he hasn't seen enough forward momentum. >> so he's taking it to the public. theoretically, these conversations have been had. >> almost a certainty, right? >> i would say yes. >> breaking news on marcato and dillards. next up, we are taking it to marrakesh, morocco. ♪

>> innovation and

entrepreneurship are the focus today in morocco. conversation the is a singer-songwriter, producer, hip-hop superstar akon , who is investing in africa with his lighting africa project. hans nichols is with him now. take it away. >> we did hear about your twerking off-camera. i don't know if we are allowed to talk about that. we are going to talk about investing. i'm here with akon. are you more of an artist or businessmen these days? >> these days, more of a businessman. >> you want to electrifying a million homes is the goal? >> when we started the idea was to light up a million homes. now we are in 14 countries. likeve surpassed our goal beyond. >> you don't think of yourself as a nonprofit.

you are doing this to make money. >> clearly. i think it got mixed up in the nonprofit because everyone kept saying it was an initiative. we were doing so much good for africa itself that they assumed it was nonprofit. not too many artists to get into energy without creating some kind of charity. >> billion-dollar fund, you just started -- how has demand been? ultimately, like i said, we are in 14 countries, contract signed. it was pretty easy to get them involved and they were excited and doing a lot of stuff in africa. now the demand for it is really high. >> you have chinese investments, do you have [indiscernible] investment -- where is the money coming from? >> there have been a lot of chinese coming on board. talk to us about the

challenges of ebola. you are also doing and him it -- initiative with matt damon, morgan freeman. >> it is more about raising the awareness. there is so much like of education related to ebola -- lack of education related to ebola. just trying to raise that voice and get everybody involved in understanding what it is so we can figure out a way to deal with it. >> is there an economic component as well? >> it's more social to me at this point, and how it is being projected. normally when you are afraid of something, you don't want to get closer to it. my purpose of going at this time was to understand it so i can give the message out to the people that follows what i'm doing. >> you have a lot of fans. have you met with any young entrepreneurs here and what are you hearing from them? >> especially on the digital side, there's a lot of them here.

there's a lot of young entrepreneurs going into agricultural as well. them on that digital, tomorrow, how digital is affecting africa. >> what is the prospect for agriculture? you are starting in rice in senegal. branch offto everywhere. a lot of the areas we are concentrating our rural areas. after a certain amount of time, you can do anything, especially related to agriculture. we want to have areas where we are putting in light, where we are having agriculture. >> i thought we were talking to a hip-hop artist, but we are talking to a one man holding company with a lot of ventures in africa. money for that billion-dollar fund. back to you, stephanie. you and erik can talk about twerking and what you do in your free time. entrepreneur.

hans nichols with the one and only akon in marrakech. are you in akon fan? >> i don't know his music well enough. >> ♪ i want to love you ♪ you know that one? we will be back. ♪

>> that will be it for "market makers." >> we met a guy who had not seen

years until his sight was restored by a pair of goggles by a company that just went public. pretty amazing. >> tomorrow i won't be here. i will be getting ready for the 150th adversary of the lehigh-leslie at football game. it will take me 24 hours to prepare. >> i will have an exclusive interview with richard cordray. >> for now, it is 56 past the hour. liberty v is taking you on the markets. -- bloomberg tv is taking you on the markets. >> stock pretty much rising, after sales of existing homes unexpectedly rose and resellers -- retailers rallied on better than forecasted earnings. this is foreshadowing the weaker manufacturing we are seeing in the euro and china. it is time for options inside.

joining me is our chief options strategist. u.s. leading indicators, they increased more than forecast in the month of october. what do you think? extrase markets are perplexing at these moments because the question is now what, after this recovery, how do we will move forward and what is the next move. i'm looking higher, but how we get there is a million dollar question. the vix has been an interesting actor in this, in the fact that even though the market [indiscernible] new highs, the vix has been positive trade usually there is an opposite correlation. the overall trends are intact. funny 5% abovel

the lows made last july. >> what are the catalysts that will drive the market higher as we look forward to the first quarter? this dollarng at reversal. that is a big issue. we saw the dollar make new highs two fridays ago, and then the market closed lower. that is technically a sign of a [indiscernible] couldt is the case, we see the energy sector stabilized. that is the sector that has been holding the market back. be a catalyst for all stocks to continue upward. there's a lot more upside in stocks. it is somewhat concerning that we have not had a pullback of any way, shape, or form after this 10% strata move. itone stock playing ball, is having its best day of the month after jenny upgraded shares to a buy.

said there is more upside than downside potential. what is the options activity looking forward today? >> not seeing much in yum! itself. more upside. we are in the midpoint of the action for the last year at 75. if it continues higher, you could see a run to 100. >> you also have a trade for us. the stock is taking a beating this year, down more than 20%. it does have a ton of momentum going forward after a 10% run over the past week. do you see the good times continuing? >> i think there's limited downside, and limited risk from that standpoint, more upside potential. the target is 14. i moved to 14, then target 17. the stock was at its lowest level it has been in 20 years. i'm looking at a july 10 call,

1090 is the low this year. we saw bullish divergence. we saw new lows. combine that with the key reversal in gold. you have got a lot of things adding up that the worst may be over for gold. it is a low risk play. it gives you seven months of time for good things to happen, and that option would gain significantly. >> we are going to have to leave it there. alan, thanks for taking the time there. we are on the markets again in 30 minutes. "money clip" is up next. ♪

." welcome to "money clip we tie together the best stories and video in business news. i'm olivia sterns. the islamic state wants to go back to medieval times, but the terrorist group is running itself like a modern corporation. [indiscernible] we put them to the test. speak tompy ride, we the journalist who is accusing the company of using scare tactics against her. we head out to l.a. for the