>> from bloomberg world headquarters in new york, i'm mark crumpton. this is "bloomberg west." -- "bottom line." ♪ to our viewers in the united states and those of you joining us from around the world, welcome. we have full coverage of the stocks and stories making headlines today. the lamarcus begins his series of reports on business in cuba. "bloomberg west" editor-at-large cory johnson speaks to a minnesota center -- senator al

franken on net neutrality. here are the top stories we're following. the u.s. federal communications commission. has approved new internet regulations the vote was 3-2. the rules would prevent broadband providers from charging websites to deliver their content more quickly. big internet providers like verizon, at&t, and comcast were opposed. they say the regulations would stop them from making billions of dollars worth of network improvements. winners include video streaming services like netflix. check your mail. apple has sent out invitations to an event on march 9 in san francisco. the company is expected to unveil details for the introduction of the apple watch. spring forward, the event to be held at the center for the arts theater at 10:00 a.m. apple first unveiled plans for a smart watch back in september. the u.s. senate is moving forward on legislation to fund

the homeland security department just a day before a partial shutdown of the agency. many house republicans say they aren't ready to admit defeat and approve spending for the department without demanding concessions from president obama on immigration. >> all republicans agree that we want to fund the department of homeland security and we want to stop the president's executive actions with regard to immigration. >> we have had this comedy of errors that has been going on this major amateur hour non-legislation that is standing in the way of honoring our oath of office. >> a federal judge has cleared the way for minnesota vikings running back adrian peterson to be reinstated. peterson pleaded no contest to reckless assault after striking his four-year-old son with a switch. the move potentially clears the way for peterson to return to the team, be traded, or released. u.s. consumer prices declined

last month by the most in six years. 7/10 of 1% drop is blamed in large measure on falling fuel prices. if you take out energy and food costs, the cpi actually rose. there is sign of uneven progress in the labor market. first-time claims for unemployment benefits rose by the most in more than a year. jobless claims totaled 313,000. that is well below the median forecast. that's a look at the top stories of the day. the biggest vote in washington today happened not on capitol hill, but at the federal communications commission where new rules of the road for the internet passed a crucial test just moments ago. the historic vote will affect every american's access to the web, and every company trying to do business online. steve washington correspondent peter cook joins us on the phone. >> the meeting just wrapping up at the fcc.

they're still having a background briefing to explain what would happen here. it is a historic decision for the fcc, a deeply divided fcc moving forward with this net neutrality rulemaking. it was chairman tom wheeler who first pushed this proposal. he succeeded in getting the backing of his two fellow democrats. what does this rulemaking do? the reclassify's broadband internet as a telecommunications service, opening it up to internet service providers to [indiscernible] regulations. it bans fast lanes on the internet. wireless carriers are covered by this, but there is no rate regulation. the fcc could have gone further if they wanted to. in the words of tom wheeler, this is a historic day. >> today is a red letter day for internet freedom, for consumers who want to use the internet on their terms for innovators who want to reach consumers without the control of gatekeepers for

a future in which there are rules to protect the internet and its users. >> but it was a deeply divided fcc, two republican commissioners highly critical of this proposal saying the government is stepping in where it does not belong and will do more harm than good for the internet overall. >> this order imposes intrusive government regulations that won't work to solve a problem that doesn't exist, using legal authority the fcc does not have. accordingly, i dissent. >> it was a lengthy dissent from pai. in the end, the vote was 3-2 in favor. a whole host of people in the room, supporters of the chairman's proposal celebrating, cheering at the end. steve was a knack among them. he told me afterwards this was a victory for consumers. >> how confident is chairman

wheeler that this rule will survive a legal challenge? >> we all know it will be a race to the courthouse on the part of internet service providers and other players who don't like this rulemaking. the chairman was asked about that in a -- briefing yesterday. feeling confident, but we know this will be a big legal battle. the last time the fcc went down this pathway, a court did force the fcc to reconsider its rulemaking. both sides expressing confidence in their legal position. we know this is going to court. >> peter, thank you. more on net neutrality and the fcc vote coming up. minnesota democratic senator al franken will speak live with my colleague, cory johnson. that interview is coming up at about 2:45 p.m. new york time. andrew cuomo announced today he will be the first u.s. governor to make a trade mission to cuba. the april 29 trip will focus on

potential opportunities in an untapped market of 90 million consumers. anyone who can successfully connect america's capitalists with cuba's communists could make major money as a middleman. villa marks reports. >> at the u.s. ambassador's residence in havana last month journalists from around the world gathered to hear the latest on the diplomatic talks with cuba. among them was a cuban-american businessman, hugo with a vested interest in the outcome. >> for cubans living abroad, we have a legitimate desire to come back and to help and participate in the rebuilding of our country. it is our right. >> is among a handful of cuban-americans who have come back successfully and skirted u.s. sanctions and set up businesses here. at his offices in havana, he directs a local staff of writers and editors who put out two magazines. the focus is on cuban arts

culture, and tourism, with no mention of the country's politics. as publisher, he rarely stays quiet on the subject. >> from business to politics to shaping u.s. policy towards cuba, that has been my goal for 20 years. >> in promoting those goals, he has often promoted himself. >> i like to focus on the people. it affects my family, my friends, the cuban people. >> if first left cuba in 1980 as a 16-year-old. that left him in south florida, where he joined the massive community of cuban exiles. his family ties to america go back several generations. his great great grandfather worked with the u.s. military when they briefly governed cuba at the turn of the last century. his father was also a well-known figure on the island, a member of the hugely popular group. hugo follow his father into the industry. >> we have promoted cuban

culture in this community, brought cuban artists, produced concerts that started changing the hearts and minds of the people of my community. >> many cuban americans believe the communist revolution would ruin cuba, but cancio told us that although miami will remain his home, he has changed his own mind about cuba's potential. >> i lived here for 35 years more than i lived in cuba, but i also love my country of origin. for me it's like my mother and my dad needs to get together to work out their differences. >> cancio says he is focused on brokering business deals that will prove profitable and patriotic. >> is it possible to both make money and help the people in cuba? can you do one without the other? >> one complements the other. this is the difference between me and the ceo of another company whether american or

cuban-american, that i also bring a lot of passion. >> very few discussions about cuba's future lack passion. for the moment at least, most businesses here still lack investment. >> my colleague, villa marks, joins me in studio. that was a clever and poignant turn of phrase, one is a mom, one is the dad, but you have to serve both masters. >> here is a man who has managed to position himself very well between these two nations. he has the background, the contacts he is friendly with u.s. state department officials. he's also a guy that meets with big american capitalists. this is a man who stands to win a great deal. >> which industries would like to work with this man? >> he is setting up a billion-dollar investment fund that will be looking at all sectors. the biggest wins for him will be in the telecom industry.

he has earned with a prepaid cell phone company. that will be his big entree into some big money down there. >> is he a hidden venture capitalist? >> he's a serial entrepreneur. he has moved into all different areas. he's not a shy and modest man. it is people like him who will succeed in this environment because they have the links that you need. >> cuban officials entrepreneurs, how comfortable are they with the idea of american money and businesses flooding into their country? >> people like him will tell you it's all very well for americans to go down there, knocking on doors, and say i want to invest in your businesses. a lot of these businesses and officials in cuba might turn around and say, where have you been? people like him feel [indiscernible] can make that happen. >> at the top of the hour on "street smart," you're going to talk about baseball. >> yes, and cuba's role in the major leagues.

>> young men from cuba, the boston red sox are looking to throw a ton of money at him to get him to come over. >> $60 million overall. >> thanks. villa will join us tomorrow with a focus on the rum industry and the fascinating intellectual property battle on the horizon coming up tomorrow on "bottom line." up next, a focus on retail and the struggle at sears. julie hyman has been doing some research in response to the question, who shops at sears? ♪

>> let's get you some of today's top stories at this hour. another wall street bank is being held to account for the financial crisis. morgan stanley has agreed to pay $2.6 billion to settle an investigation into the sale of mortgage bonds. the u.s. department of justice

investigating claims that morgan stanley deceived investors about the quality of the home loans in those securities. jpmorgan, bank of america, and citigroup have already made similar settlements which totaled $35 billion in cash and consumer relief. the royal bank of scotland group plans to eliminate more than 1000 jobs at its u.s. trading division. the cfo said it is part of a global overhaul of the investment bank. job losses are part of a wider plan for the investment bank to focus on 13 countries instead of 38. sears reported a smaller loss than a year earlier with store closings and asset sales shrink the company. its future is still in question as comparable sales fell 4.4% and sears burned through cash. bloomberg's senior markets correspondent julie hyman covers retail for us. who still shops at sears? >> do you still shop at sears? >> no.

>> matt miller has for craftsman tools. the company has been shrinking. the core customer at this point skews older than some of the other retailers, according to cantor retail, which surveys shoppers. the average shopper at sears was 50.4 years old and had an average household income of $57,500. 21% of them have children in their household. relatively low income, and relatively older. i asked cantor this where are these sears shoppers shopping elsewhere? if sears goes away, where might some of this traffic go? 65% of them in the past month had shopped at jcpenney. 82% of them had shopped at walmart. 67% of them had shopped on amazon. i also did a very informal

survey on facebook of my friends and family and ask them, do you shop at sears? many of them had not in the past year or so. some said, we go there are a couple times a year. maybe we get our cars serviced. maybe we buy an appliance still. maybe we buy those craftsman tools. or maybe we go to buy the lens and -- lands''s end stuff. >> you are talking about a a29- 129-year-old company. they are trying to avoid radioshack. >> yes. the latest tinker is that he's exploring spinning off 300 stores to a real estate investment trust, and either leasing them back to the retailer from that separate entity, or leasing them to other retailers. he's trying to morph it into a new entity. >> senior markets correspondent

julie hyman, thank you so much. coming up, universities are finding new ways to juice their application numbers. their tactics are drawing criticism. ♪

>> applications are surging at selective colleges in the united states. bloomberg's higher education reporter joins me now. she's following this trend. the last time you were on, we talked about extending some of these deadlines. now schools are using other strategies to increase their applications. what is different in 2015? >> it could be that colleges are feeling the pressure of the demographic. there are less college graduates coming down the pipe, 17 and

18-year-olds. they are trying different things. we have seen several colleges this year decide to drop an essay decrease application fees , and the numbers have gone up in some cases 50%, 40%. you can see in the chart the population is going down and the application numbers are surging. >> how can dropping an essay make that much of a difference? >> applications and college admissions have been less predicable in the last couple of years. you just don't know, am i going to get into this school, am i going to get into any school. kids want to add a few more applications to make themselves feel more secure. some students actually google colleges that don't require supplements. with the ease of the application, you press a button and add your application on to other schools. if you don't have to do additional writing for them, why

not? >> have these rigorous essays actually heard some schools? >> if you look at a school like haverford college, it asks about their famed honor code, which they're very proud of, and you have to do that essay and their numbers have been stagnant. the dean of admissions was very happy with the applicant pool, but they worry what the outside world thinks. are they as competitive as a school like swaths more? >> you pointed out in the story the rating agency moody's, it doesn't seem to be fooled by this application inflation artificial and inflated applications. is there a possibility that could be detrimental to some schools? >> yes. they pointed to a report that this application inflation could be not so great for colleges because they get a ton of applications and the kids who are applying may not really want

to go there. how do you protect your budget? you don't really know who's going to come. >> talk to us about drexel. it is one of these universities that is bucking the trend and seeking fewer applications. >> instead of dropping essays as you can see on the screen they actually tacked down an application fee of $50 for the first time in about a decade. the applications plummeted by more than 40%. if you look at the percentage of students, admitted students who actually come 10 years ago before they really drummed up applications, their yield was about 1/3. last year their yield was 8%. only 8% of the admitted students were coming. they realize this was creating a huge problem, and their new dean of admission said, we need to do something differently. they added on a fee. they wanted to know who was really interested in drexel to pay that fee. >> if you are a potential

college student and your parents and you are either listening to this, or they're sitting around and looking at colleges, what is the take away from all of this? >> you just have to be mindful of the schools you are really interested in. you may not just want to throw on additional application just because they don't have a supplements that you really have to want to go there. it's so very unpredictable. be mindful of what is going on. >> all right. janet lorin joining me in studio, thanks so much. coming up up, traditional publishers versus tech giants google and facebook. can content providers afford to ditch them and be successful in the digital age? that story and more when "bottom line" continues. ♪

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he's out there. there's a guy out there whose making a name for himself in a sport where your name and maybe a number are what define you. somewhere in that pack is a driver that can intimidate the intimidator. a guy that can take the king 7 and make it 8. heck. maybe even 9.

make no mistake about it. they're out there. i guarantee it. welcome to the nascar xfinity series. mark: welcome back to the second hour of "bottom line" on bloomberg television. i'm mark crumpton in new york. let's get you some of the top stories we are following on this thursday. crude oil at the close of floor trading -- crew down over 5%. google is making its biggest bet so far in renewable energy. it is investing $300 million in solar city to assist rooftop power plants. that's enough to support at least 25,000 solar powered installations. it could be the start of a proxy

war with apple which is teaming up with first solar to power its own offices along with dozens of others. in ukraine, the cease-fire may be taking hold. authorities say there were no attacks by pro-russian rebels overnight. ukraine have accused separatists of consistently violating the cease-fire. war with apple which is teaming up with first solar to power its the country has another problem in the meantime -- the ukrainian currency has been in freefall, losing more than 50% against the dollar this year will stop late yesterday, the country's central bank lifted a ban it had imposed on foreign currency trading. jeb bush would not hesitate to go to war in the middle east like his father and brother before him. he former florida governor, who is expected to seek the presidential nomination in 2016 says his family's history would not be an issue if the safety of the american people was at risk. he made his comments on the hugh

hewitt radio show. that's a look at the top stories we are following. tech giants like google and facebook are turning more and more into media companies. this is both an opportunity and challenge to traditional publishers as more content goes digital. joining me to talk about this shifting model was kirk mcdonnell. welcome to "bottom line." i recently interviewed the president of lego north america and he said one of the reasons the country had serious financial problems was it stopped listening to its customers, which i guess his rule number one. how has technology change the way people consume content? >> the reality is there's a proliferation of technology absolutely everywhere. that has changed the way consumers engage with content or services. it is now on their terms and we are talking about phones will stop your phone has become a tablet and that access point means for those service providers trying to get the intent -- tried to get the attention of that consumer, they

have to be more relevant and embrace technology themselves to make their content or service available where the consumer wants and on their terms. >> do some struggle with that? >> absolutely. traditional publishers have felt very comfortable not just owning content, but owning the distribution channels. but the technology has made distributional sewed different -- has made distribution so different, so you have two be more concerned about your customer in a holistic view. mark: you talked a moment ago about mobile. has cutting the cord hurt marketers or helped them? >> i think it has helped some marketers, not all. those that realize i now need to maintain the relationship not just in one screen but in multiple screens both as a marketer and producer of content, they have one. but this need to make -- to

bring technology to the table is what most are challenge with. mark: your company helps large publishers price, package and sell ad space in a digital matter. you use real-time bidding technology. how does that help make marketers not only faster, but largesmarter? >> the marketplace has sped up to real-time because there is now data available, information that says this person using a cell phone at this moment might be relevant to a particular set of advertisers will stop -- of advertisers. mark: have a sped up kicking and screaming? >> they have been smart. we are building more competitive and interesting environments for the consumer. to do that, we have to speak in real time. they are telling us about their interests and making sure we can control what message they see next, both content and add messages. mark: is marketing automation at

an intersection right now? >> absolutely. those who embrace it as a marketing strategy and embrace the software suppliers that can allow them to compete have a shot at maintaining, protecting and managing that relationship that a content producer like bloomberg has with all of the consumers it touches on a daily basis. mark: that crossroads, what is it called? how do you keep automation from overwhelming the consumer? >> the consumer has more control than we realize. the consumer is filtering for relevance. if they don't want it, they turn it off will stop they go to another source. that is the danger and the opportunity. mark: do they realize they have more control? believe they do. if i no longer trust a news source, i simply click. it doesn't require much to get another news source. that's for the consumer has its power. it forces an important change in

the mindset saying i have to protect that relationship. its most valuable asset i have will stop if i don't protect that data the relationship, find ways to monetize it on the terms of the consumer potentially my business is at risk. mark: we see a shift like this playing out at facebook and google. they were tech companies but they are de facto media empires. traditional publishers, can they afford to ditch the giants like facebook and google? >> it is described as a frenemy relationship. they depend on the technology but at the same time, they have to realize these humvees have seen a huge opportunity to be engaged with the consumer in a more interesting way. publishers have the ability to make a difference. mark: what is the next decade in a bushing going to look like?

>> it's going to be a more unique experience at every turn. consumers are going to expect a real-time conversation with content providers and those content providers and publishers have to rely on independent software, not confused media companies or exchanges but independent software providers to help them stay current with that consumer. mark: before i let you go, these new net neutrality rules, does that do anything for your business? >> it's interesting. we pay attention closely but it really does not affect our business. our business is about empowering the publisher to manage and protect the relationship they have with the consumer. it's not about access, it's about that relationship. mark: sir, it's a pleasure to meet you. still ahead, more on the trail and the fcc vote. minnesota senator al franken will speak live with cory johnson. that extended interview is

coming up. "autumn line" -- "bottom line" on bloomberg television continues just a moment. ♪

mark: welcome back. it's time for today's latin america report. a judge in buenos aires is dismissing charges that the argentine president try to cover up the alleged involvement of iranian officials in the 1994 bombing of a jewish center in the capital. the judge said documents failed to meet standards needed to open a formal investigation. in the meantime, three pupils knowledge of the matter told bloomberg news argentina's plan to sell at least $2 billion in new bonds has been blocked by a u.s. federal judge who reportedly cited the banks for failing to comply with subpoenas. argentina was a tempting to raise that financing after failing to sell as much as $3 billion of the dollar-denominated bonds due in 2024. that is your latin america report for this thursday. next, minnesota democratic

senator al franken will join my colleague, "bloomberg west" editor at large, cory johnson. there's an fcc net neutrality vote today. that's our story, coming up. ♪

mark: welcome back. we continue to following our top stories -- the federal communications commission's decision to approve net neutrality rules. "bloomberg west" editor at large cory johnson is joined by al franken on capitol hill. cory: senator franken was one of the biggest proponents of these title to regulations, preventing throttling, preventing companies from deciding who should be old to provide what kind of services on the internet. how do you feel about the fcc's decision? >> this is a big victory. we've been fighting for this for quite a while. this is about maintaining that neutrality, the architecture of

the internet from the very beginning, preventing paid prioritization, fast lanes and slow lanes. the invoking of title ii is something the d.c. circuit court pointed to when they twice overturned fcc regulations and rules that tried to maintain net neutrality. this is something we are very gratified about and over 4 million americans wrote in to the fcc, more than twice as many comments as a -- as they have ever received on any issue, a vast majority saying keep that neutrality. cory: i want to talk to you about that. it's a fairly intense response from the public to a fairly arcane rule from the fcc. what does the response from the populace tell you and what does that tell you about political organization on the net?

>> i think it tells you that especially younger americans, but a lot of other people really knew what this subject was about . as arcane or technical as people think it is, it's a very basic idea, which is that all content on the internet is treated neutrally. instead of fast lanes and deep-pocketed corporations buying them to get their content to you faster and a slow lane for everybody else, this is going to maintain net neutrality , which has been the architecture and why we have had all this innovation in the internet ecosystem. cory: it seems as though there are three camps of critics -- the view that government can do no good and should have no regulation -- i will leave that where it is because it seems

like that doesn't -- that applies to any circumstance, but there are two camps is that i believe the net neutrality and title ii is the wrong way to do it and the fcc decided title ii is the right way to do it. wide easing title ii is the right way to make sure the internet remains free and clear of my organization? >> when the d.c. circuit court ruled on this, they pointed to title ii as a way to do this. either because he didn't understand or for some other reason, ted cruz did this video that got a lot of play where he did an old rotary phone and a smartphone and said this was under title ii when the fcc regulated phones and this smartphone is free of that. that just not true.

the voice on that smartphone is actually under title ii. we have had all that innovation -- you are probably not old enough. i can't see you but to remember when ma bell was mob bell and you paid so much for long distance. we've gotten to hear -- we've gotten to here. i haven't read the rules, but the way chairman wheeler outline them a couple of weeks ago, they are not going to be setting rates, they are going to use forbearance, but this is meant to preserve net neutrality and again, this is what the circuit court basically said was the legal basis in which the fcc could maintain net neutrality. cory: i am old enough. i dated mob bell -- ma bell.

but people don't like what they get from comcast and time warner. we know the telecommunications companies themselves like verizon and at&t are not the leading innovators in the world of technology. >> in fact, sometimes they try to fight it as much as they can. this is an issue on municipal broadband which some of these isps have been fighting on a state level. they shouldn't be doing that. this is not going to be -- this regulation is not going to stop innovation at all. as a matter of fact, this is how we have innovation on the internet. everything we have done thus far on the internet has been while we have had net neutrality. i think people understand that and i think those 4 million people plus who wrote in understood that basic argument. we have had a lot of info -- a lot of misinformation and

disinformation put out about what net neutrality is will stop -- net neutrality is. one member of the house said we had all of this innovation without net neutrality, why do it now? you don't have to get on the floor of congress if you know something. you can say anything you want. the fact of the matter is we have had net neutrality from the beginning when darpa created thing, when the taxpayers paid for this. it has created so much of the new gdp growth we have seen. a few years ago, there was a study on this and the previous five years they studied it and it had contributed to about 25% of gdp growth around the world. this is essential that we maintain this innovation and not give the power to the isps.

this has been like ford and ups and bank of america and other really big companies formed an alliance to fight for net neutrality because they realize any business that does anything online needs net neutrality. cory: al franken, senator from minnesota, thank you for your time today. >> inc. you. --thank you. mark: stay with us. scarlet fu will have a check on them market movers on the other side of this break. "bottom line" continues in just a moment. ♪

mark: get the latest headlines as the top of the hour on bloomberg radio and streaming online at bloomberg.com. it does it for this edition of "bottom line." i'm mark crumpton reporting from new york. on the markets with scarlet fu's next and then trish regan with "street smart" at the top of the

hour. see you tomorrow. scarlet: it is 56 pass the hour and that means bloomberg television's on the markets. as we head into the final hour of trading there's some meandering any equity markets. the snp and dour drifting lower while the nasdaq approaches 5000. the dollar is strengthening the most in three weeks after reports show consumer prices excluding food and energy may be closer to rebounding. if you are to take it to its logical conclusion, that would give the federal room to consider raising interest rates. as a result, you see treasuries falling for the first time this week. we are at the tail end of earnings season with retailers reporting results and their shares are for the most part flying high. kohl's reported numbers that topped analysts estimates. other names that have recently run ported include target each of them hovering near record highs.

after the bell today, we will hear from gap and jcpenney. joining me now to talk about how it fits in with the overall market is our editor at large for the bloomberg stocks team. you say valuations are uncomfortably high? >> valuations for the stocks in the xrt are, depending if you are looking at forward or traveling earnings are the highest in a decade. there are a lot of sectors of the market at the high valuations but retailers are standing out there. the xrt is up 14% since oil peak in june. about double the overall market. pricing in some strong earnings growth that we will have to see if it comes through and if oil stays where it is to provide that tailwind. >> pricing in the benefit of oil gas prices, so many companies are focused on the domestic market and are not subject to the stronger dollar. >> that is part of it.

hand in hand with oil, the spending power of the dollar is strong and allows the imports a lot of retailers are bringing into be cheaper. scarlet: let's talk about the broader market overall. the fed testimony from janet yellen's quiet. what is going to be the next catalyst? >> a lot of people are talking about just the overall markets valuation. we had a tremendous expansion in price to earnings multiples in the last four or five years and looking at overall earnings growth, and looks like the second quarter will be negative and the third quarter is expected to be negative earnings growth. for the whole year about 2.5% earnings growth. energy is sucking the earnings out of the growth but with the market up today and earnings growth expected to be about that for the year, to get much more gains from here, you would have

to see further valuation expansion and a lot of people are skeptical about that. it explains why goldman sachs and barclays, their year-end estimates are for a 500, so they are basically saying the party is over for the year. many strategists have higher estimates, but as far as barclays, they believe valuations are going to go up once the fed start raising interest rates. scarlet: thank you so much. we'll will continue to monitor the nasdaq approaching 5000. ♪

trish: hello and welcome to the most important hour of the session. we have 60 minutes to go and i'm trish regan. we have stock hovering near record levels. oil prices tumbling the most we've seen in weeks, but tech is rallying. the nasdaq edging closer to a record high. we are counting down to earnings from jcpenney's and herbal life. "street smart" starts now. here's a look at some of the top stories we are watching ahead close -- the dallas fed reserve president says markets have overshot and will