mark: >> from bloomberg world headquarters in new york, i am mark crumpton and this is "bottom line." ♪ to our viewers here in the united states and those of you joining us from around the world, welcome. we have full coverage of stocks and stories making headlines on this thursday. julie hyman has changes at mcdonald's that are more than just chicken. we will have a roundtable discussion on the latest stress tests for banks with michael

mckay and outs and allison williams of bloomberg intelligence. we begin with breaking news with shelby holiday where a delta jet skidded off the highway. shelby, what is the latest? shelby: we just heard a runway here at laguardia will open anytime now. they said 2:00 p.m. the plane skidded off the runway while attempting to land. 127 passengers on board and five crew members. injuries appear to be minor. only two people help to have been transported to the hospital. they say the number could change. also, authorities are not commenting on what caused the crash. they will secure the pain -- the plane. they have reported good braking conditions. they have had no problem. it is unclear what caused the

accident. the faa shut down immediately after it happened. there are a ton of passengers. 72% of the flights out of laguardia are canceled today. this is not a fun place to be. people are just waiting to get out of here. mark: shelby joining us with the latest at the airport. thank you. let's get some of the top stories we are following on this thursday. in cyprus today, the european central bank president mario draghi says the central bank will begin its bond buying program on monday. an effort to divert inflation. mario draghi says the eurozone government must do more to fix its own economy. >> structural reform is being implemented swiftly, credibly, and effectively. this will not only increase the future sustainable growth of the

area, but also raise expectations of higher incomes and encourage firms to increase investments today, bringing forward the economic recovery. mark: six june -- since june they have offered long-term loans from banks. economic growth targeted more than 15 years at the people's national congress premier league, 7% growth this year was called for it, down from simply 5% in 2014. last year, china passes economy grew at the slowest pace in a quarter-century. the number of people filing for quarter -- for benefits the highest level in more than nine months. the harsh winter wet -- the harsh winter weather. tomorrow, we will get the jobs report for february. the survey is looking for an increase of to a jet 45,000 nonfarm payroll jobs and an

unemployment rate of five points is percent. wrigley brothers elephant acts. the absolutely be phased out by 2018, citing growing public concern about the animal's treatment. 43 elephants will live at the company passes 200 40 acre center in central florida. elephant acts have been showcased by wrigley for more than a century. now, the new york federal reserve is losing power in a behind-the-scenes reorganization. the wall street journal says a little-known chlamydia is taking the job of overseeing banks like goldman sachs. the committee is headed by the fed governor. he tells the journal it was obvious that regulators had not done a good job before the crisis. that is a look at the top stories we are following this hour. results of the bank passes and stress tests begin today.

they were mandated by the dodd-frank act of 2010. they look him in two stages. today passes results will be on the impact of the tests. joining me now is michael mckee of bloomberg news. and allison williams, bloomberg intelligence bank analyst. thank you so much. it is the start of a two-day process. what are we in for? >> the fed looks at what will happen at the capital of various ranks. you have to be bailed out to see whether or not your capital ratios are hire enough to withstand the area. we find those results today. we find out next week that might not just be the level of capital. it may also be the fed's comfort with internal control and how well banks prepared in the future. mark: do you mean worst-case

scenario? >> the fed does several different levels of tests to see if they can hold on or whether losses will be such that they will be underwater if they went through the great recession again or even worse. mark: aside from a pass fail grade, what should banks be looking for today and tomorrow? allison: is when we have the possibility of getting big surprises. as you said, it is a two-step process. today is the stress tests. most banks passed last year. this might be the first year when all banks passed. next week is really going to be the more deciding week for investors because that is when the fed approves or the technical language is either do not object or object with capital lands in the banks. mark: this is week, the fed chair janet yellen was in new

york and she addressed the budget commission. she said before the financial crisis, the fed focused too much on regulating individual firms and did not pay enough attention in keeping the entire system stable. how are the stress tests stable? michael: the may 2009 is credited with stopping the libran brothers. terms of the overhaul system, they are only part of it. they are used to keep track of various banks and how those banks or relate to other banks. that is one of the reasons they relate inside. mark: when you say the culture of the bank, what do you mean? michael: it is one thing janet yellen does talk about. unnecessary risks, or are they more focused on prudent management of all their assets? it is a fine line for banks trying to take a profit and

regulators going too far. mark: is the fed been looking for banks to be more proactive several years after the crisis? allison: i think what regulators want is first of all that the banks have enough capital for adverse scenarios, as we said. the second layer comes next week. first of all, what are you planning to do, and do you have enough capital to withstand the pressure but also, what are the processes that you have in place? that has really become the bigger question mark. last year, the highest capital plan, even though it had a fair amount of capital and it fared very well in the stress tests, regulators really objected to the prophecies. that was citigroup last year. this year, i think that is a big question on investors'mines.

-- investors' minds. mark: capital standards in the u.s. subsidiaries. you might look there for any particular problems. last year, it was city. people expect they have got their house in order now and also, zions bank they had an unusual situation with ceo's is on the books. that hopefully has passed. the general feeling is most base can get through this. mark: as allison mentioned it was about the processes. u doing? what can we see tangibly? what steps are you taking to avert some sort of financial catastrophe? michael: the fed wants to make sure they know what the fed is expecting of them and that they require them to do their own test as well as the fed test so they are constantly thinking about what can go wrong.

mark: allison, are some of these two big to manage or too big to supervise? allison: that has been a question on a lot of people's mines. janet yellen made the point specifically that they do want banks to get smaller. at the same time, we heard jpmorgan and their ceo defending the value of the diversified model and actually talking about other ways they can manage the capital standards without necessarily having to sell off the businesses. mark: the stress tests, is the fed's's role one of prevention? or is it putting a turning it on it after it happens? michael: before it happens, they want to prevent any problems. we go in and look for problems

at of time. >> but the fire marshal on the beat? michael: there is a lot of pressure on them to be the cup on the beat. this is an intersection of the both. allison: one of the points timothy geithner makes is having sufficient amounts of capital is one of the best protections if not the best protection you could have that is what helps you protect the system. he was obviously part of the first round of stress tests that helps give confidence back in the system. mark: all right. mike mckee, thank you both so much and we appreciate it. next, a new ceo and a new outlook on food origins. a new era at mcdonald's? julie hyman will have some answers when we continue in a moment. ♪

mark:mark: welcome back. let's get you some of the top stories we are following this hour. a knife attack required 80 stitches to close. mark was waiting to give a speech when he was attacked by a man described as a north korean sympathizer. that man is in custody. he slashed at the face while demanding the u.s. and military exercises with south korea. hillary clinton says she wants the public to see her e-mail. a potential democratic presidential contender is urging the state department to release the messages she wrote from a

private account when she was the secretary of state. she has been criticized for using private e-mails to conduct state department business. she says state authorities will review the e-mails for release soon. coca-cola is remaking the look of its biggest drinks in europe. the company is trying to convince consumers there is more to the brand ban its best-known sugary drink. the new one branch design is intended to unify coca-cola and its lower calorie variance under a single identity in 12 european countries. that is a look at the top stories we are following in this hour. i did not know there were that many. changes to your chicken mcnuggets. billy doll's ceo announced the company will work with its suppliers to stop selling chickens raised with human antibiotics. the bloomberg senior markets correspondent julie hyman joins us now. what will this mean for mcdonald's bottom line?

julie: it is unclear. we know anecdotally the type of chicken raised this way is more expensive. it is not clear exactly how much more expensive. the folks at the national chicken council say it is five to seven cents a pound, but we do not know exactly. mcdonald's is not telling us at this point. it is not clear who will eat the cost if indeed there is an increased costs and will it be it seems somewhat unlikely. they are already not terribly happy with the company because of sliding sales. or will it do customers, people who buy at mcdonald's. according to analysts, the does not seem to be a willingness and mcdonald's. mark: what else are they

planning? julie: that is also unclear. there is a lot of speculation and a lot of talk about what he needs to do. he needs to move forward with better technology to the stores, mobile payment and mobile ordering, a better loyalty program for example perhaps at the stores as well. there has been a whole debate about the size of the menu at mcdonald's as well. that is one of the things franchisees have been upset about. there has been growing complexity and growing size in the menu. it makes it shaky and slows them down, etc. there is talk about whether he might pare it back or introduce more customization at mcdonald's as well. mark: julie, thank you so much to coming up, the world's's most powerful companies -- countries want to do with iran and its nuclear program at the end of the month. is this another one of those shifting deadlines? we will take a look at that one we continue in a moment. ♪

mark: john kerry says serious gaps were made in nuclear talks with iran. our bloomberg policy reporter joins me now in washington paired what was the purpose of the visit to saudi arabia today and what did he achieve, if anything? >> this was an opportunity for john kerry to meet with leaders as well as foreign minister is not only from saudi arabia but also the growth cooperation counter -- council. it was an opportunity for him to try to persuade all of these allies who were as worried as an iranian nuclear weapon, a potential for one, as the israelis or at least almost as

worried. the saudi's and others should not work themselves toward another type of program. that is the main idea. mark: you talked about what seems to be the start of an unlikely alliance between saudi arabia and israel. both have issues with iran. shiite, iran, the islamic republic, are viewed as a rival in the region. >> that is right. it dates back to a supposedly iranian plot to assassinate the saudi and acid or here in washington dc couple of years ago. there is no love lost between these two countries which see themselves as leaders of different branches of the muslim religion. the main issue here is not about that. it is really about the fear iran getting a nuclear weapon. netanyahu speech to congress

the israeli leader speech, on tuesday, really highlighted the dispute that the israelis have with the obama administration over the possibility of getting a reliable deal with iran and the saudi's share some of the same concerns. mark: the prime minister netanyahu's speech this week, what exactly is his dispute with the obama administration over iran and are the domestic policy the driving force here? >> domestic policy is one element. we are less than two weeks ahead of the israeli election and this is a way for him to potentially score point. and make himself look good at home. on the other hand, i think he came with a genuine reason which is that he has a fundamental disagreement with the obama administration over how to prevent iran from any a nuclear weapon. the obama administration believes the best way to do that is to have a solid deal that would last for at least 10 years but hopefully longer that would

include heavy verification and intrusive monitoring and wood for bid iran from doing you know, enriching uranium to the point that they could get a nuclear weapon. net yahoo!'s issue is he does not believe any deal taken with this could be trusted. although he said he could get a much tougher deal, in his heart of hearts, he does not believe any deal that the islamic republic science would be valid. behind that, many people think there would need to be regime change is iran before any deal could be trusted. although that is not the spoken issue, it is certainly one concern. mark: will we see a deal by the end of the month? >> there is supposed to be before the end of the month and a deal before the end of july, and we are certainly closer than we have ever been. it is not a hard deadline this month. but i think the iranians have come to realize if they have a chance of getting a deal, this is the one chance they have.

it is not impossible. mark: another big story. hillary clinton and the e-mails everyone is talking about. what i -- what is the latest on that? >> huge. hillary clinton last night we did she wants the public to see her e-mails that have been the cause of such controversy and that she has asked them to release them. we know the state department has $55,000 of e-mails hillary ades vetted themselves and said these are the only ones related to government business. they will have to go through and remove any sensitive and personal information and that could take months. the state department says they have asked for all documents related to hillary clinton's services as secretary and all they have gotten is e-mails. there may be more coming. we will wait and see. mark: all right. thank you. coming up, mario draghi's stimulus plan.

the ecb is set to begin its bond buying program next week we will take a look at whether it will successfully head off the threat of deflation. stay with us. that story and more when "bottom line" and more on bloomberg television continues in a moment. ♪

>> welcome back to the second half hour of "bottom line" on television. that's get you some of the top stories we are following. let's check the price of crude oil. the intraday chart shows crude down 1.4%, trading at $50.78. a delta airlines plane skidded off at laguardia. it carried 125 passengers and five crew members from atlanta.

they were evacuated after the incident around 11:00 a.m. new york time. early reports is that six people were injured, non-life-threatening. the runway is now reopened. pharmacyclics makes a blood cancer treatment that has been a true -- that has been approved for four different blood cancer uses. what would u.s. business the like if warren buffett had become a journalist/he talked about it in a video interview as part of a new iconic voices series at arizona state university. >> a fly didn't do what i do, i would want to be a journalist. i consider myself a journalist

to some extent. i assign myself a story. >> for someone who did not get to become a journalist, mr. buffett has quite a consolation prize. berkshire hathaway has more than a dozen newspapers. the ecb governing council is committed to starting its first asset purchases next week. welcome back to the bottom line. good to see you again. the ecb president, mario draghi, discussed the extent to which the central bank may by government bond with negative yields. policymakers did leave the rate

at -2/10 of a percent today. what is your reaction to his remarks? >> i think the most surprising part of those remarks was how bullish he was in terms of their ability to solve the deflation problem and how the assumption was that all of this was going to work. well, good luck. i suspect it has taken a lawful that's an awfully long time -- i suspect it has taken an awfully long time. i suspect we will be back again saying this will be going on for longer, will have to do more of it. they really don't know what the effects of these policies will be. a little late and it will be on for longer than you think. >> did mr. draghi have another viable alternative to bond buying? did he take a page from the u.s. federal reserve? the transcript came out yesterday and they revealed the

sentiment seem to be as far as qe was concerned, go big or go home. >> i always thought sooner rather than later. so they failed that one. bigger rather than smaller. that's part of it. and perhaps you would say be very broad in what you buy because you don't exactly know what they are going to do. so they've been pretty brought about what duration things are going to buy. they are going to buy and see what it does and keep trying again. they certainly have taken that book. but i think it has taken them six years to do what they bank of england -- the bank of england took six months to do. >> mark gilbert wrote a thoughtful piece that poses the following scenario, that the euro region economy might be recovering at a sufficient enough clip that the bond buying plan might be obsolete even

before it is up to speed. >> i think we have seen an initial mood in the markets because their program was announced. i think mark is a little too optimistic. this is about taking blood pressure medication. dear go to the doctor and you have taken the medication and you say this is working. can i stop taking it and the doctor says no because, if you stop, the blood pressure will come back. so i think mark is a little too optimistic. i think a lot of what has happened has been propped up on the expectations of what is coming. i certainly don't think it's too much too soon. it's too little too late. >> you mentioned the bank of england. as you know, the u.k.'s watchdog has started an investigation the fraud office looking into

the failure to spot the rigging of global markets. >> i'm not going to comment on it because it is an ongoing investigation. obviously, this is a concern. we will have to look back at all the things that happened in all the mistakes that happened, in regulation and in policy pre-2008. but let's see what happens. we shouldn't assume guilt until it is actually proven. >> fair enough. let's talk about greece. investors are still nervous. will this be a non-virtuous cycle what is going on with greece, where we are looking at another 11th-hour short-term fix or short-term reform finally be implement it? >> i just don't know. it's very hard to believe that that serious reform is coming. seven or eight years ago, i was writing and talking about the fact that they don't really have

a serious tax collection system. and since all the new government has come in, people have stopped paying their taxes. so it's not clear that very quickly this is going to get changed. and there are lots of issues, too. so this is an ongoing situation. if you are going to keep giving them loans, you have to have fundamental reform. you have to have competition. you have to have a tax collection system. i don't see that. you and i will be back talking about this over and over again. [laughter] >> professor, always a privileged to have you on the broadcast. up next, the latin america report. later, we will talk cyber security with michael chertoff. ♪

>> be sure to check out the latest edition of "bloomberg businessweek" with the cover story on russian president vladimir putin. you can read on the go with our news business week app. brazil's central bank raised borrowing costs to the highest level in almost six years on price pressure from a weakening currency. the vote was unanimous to maintain the pace of signing for the half-point increase to 12.3 5 -- 12.75%. president dilma rousseff's economic team is allowing prices to rise in an effort to shrink last year's record edit deficit. that is your latin america report for this thursday. coming up, michael chertoff, the former secretary of homeland

security. we will find out why he says e-mail privacy is no longer safe because of a 30 --year-old -- a 30-year-old law. ♪

>> let's get you some of the top stories. a delta airlines plane skidded off a runway at new york's laguardia airport today. it carried 125 passengers and five crew members from atlanta. they were evacuated after the incident, which occurred around 11:00 a.m. new york time. six people were injured. they were not said to be life-threatening injuries. the supreme court will hear arguments over same-sex marriage on april 28. and something new -- the justices will make audio of the proceedings available later that same day. but the court is continuing its ban on providing video of its sessions or even live streamed audio. the gay marriage decision is expected before july. the number of people filing

front employment benefits rose to 320,000 last week, the highest level of more than nine months. tomorrow, we will get the u.s. government's jobs report for february. bloomberg survey is looking for 235,000 nonfarm payroll jobs. we will have live coverage beginning at 8:30 a.m. washington time. tomorrow, a special edition of "market makers." for three hours, erik schatzker and stephanie ruhle will be speaking with some of the most powerful women in business and politics. guests include white house advisor valerie jarrett, group founder and academy award winner when it tell joe and karen katz of neiman marcus. we turn our focus to cyber security. my next guest says a 30-year-old

law is compromising the safety of e-mail privacy. michael chertoff is the former secretary of homeland security. he is now cofounder and executive chairman of the chertoff group, a global risk management advisory firm which advises clients on technology and cyber security. he joins us from the houston bureau. thank you for your time today. >> good to be on. >> this week you wrote in "usa today," "how privacy expectations and social practice have changed but the law has not." how has the electronic and medications privacy act outlived its usefulness and what are you hearing from your clients at tech companies? >> this act was written decades ago at a time when there was not a widespread use of e-mail and very limited storage capacity. the rule that the congress passed at that time said, if you are looking for e-mail that was 180 days or less, you needed to

get a warned, like you would need to listen to a phone conversation. but if the e-mail was older than 180 days, it would be like a piece of paper you can subpoena. that is a much lower level of requirement in terms of what law enforcement has to show. what has changed now is much more e-mail, much more storage and it's time to bring all of the e-mail into that higher standard of privacy that was required for fresh e-mail in the old days. >> for all of its best intentions, how has the cloud public hated matters particularly when it comes to free speech and where companies choose to locate their servers? >> in the old days were people spoke had a particular country and that country controlled whether they had free speech are not. now it can be anywhere in the world, the servers. the question is whose law controls?

if certain countries for bid political speech, does america have to comply with that law if the data is stored in that country? we need to sit down with a number of our partners around the world and come up with a way of rationalizing the law so we have a uniform standard that protects our free speech rights. >> from what i understand, from your writing, that would be a data localization role. how would -- localization ryke -- localization rule. >> what you want to do is say, wherever the eta is located what matters is who owns the data, who generated the data. that is the law that ought to apply. otherwise, you fragment the internet. you encourage every country to say all of our data should be kept within our own borders and that defeats the purpose of a globalized internet. >> a study published last june by the security software maker mcafee said that hacking cost of

the global economy some $575 billion a year. why are some companies still not giving the cyber security threat the urgency that it demands? >> i think some companies have a difficult time quantifying the loss. if intellectual property is stolen, another issue is that people don't know quite what to do. there are a lot of solutions out there. the question is which solution and how much do i need to spend? and where we need to do some work's layout some clear standards and a roadmap so that companies and even individuals know what they need to do and what they need to buy to protect their assets. >> the government accountability office released a report that said the nation's system for guiding planes and other aircraft is at "a risk of being -- a necessary risk" it's use

me. why has the system not been centralized by now? >> they have been working for some time now to pull together a 21st century system for air traffic control. there again is one of the issues that you build security into the system. as we move into a world of the internet of things so to speak where more and more devices talk to each other and get on the network, we have to be sure to build security into those networks or we could run a serious risk of personal injury or economic loss. >> we started talking about e-mails and that has been the big story in the news this week. the state department said it will review thousands of messages from a private e-mail account that former secretary of state clinton used for official government business. did secretary clinton break federal law? >> i am not a specialist on what the federal records act is and i'm quite sure that there are lawyers all over this from the very beginning.

i think the key is again, to recognize that much more is being done by e-mail now than was created tenures ago. and the rules for how you create e-mail, what you do with it, even the prudence of hat -- of what you write in an e-mail has to be updated along with the changes in technology. >> the former secretary of the department of homeland security michael chertoff, joining us from houston, texas. thanks for your time. >> good to be on. >> stay with us. scarlet fu will have a check in the markets. ♪

>> tonight's "all due respect" will broadcast a special report dedicated entirely to hillary clinton. that's at 5:00 p.m. new york time here on bloomberg television or live stream on

bloombergpolitics.com. get the latest headlines at the top of the hour on your tablet and on bloomberg.com. thanks for joining us. pimm fox will be here tomorrow. erik schatzker will be in on monday. i will be back on tuesday. "on the markets" widths -- with scarlet fu is next. >> bloomberg television's "on the markets." with just an hour left on the snowy thursday afternoon, we have the down at -- the dow and s&p trying to make a comeback. the indexes have been treating in pretty narrow ranges. the year road is another area of focus after the ecb came out with new forecast for the gdp. upgrading the forecast and a look at inflation ticking up as well. the euro falling be from -- falling below 110 -- 1.10.

we are seeing oil prices drift lower. the kleins over the past year is more than 10%. the charts show energy is oversold. steve, it is not just that energy needs is oversold. you are bullish on xl he. -- on xle. >> i admit that this is a hard sector to like. a lot of folks in north dakota and texas have been crying themselves to sleep in recent months. but yesterday's price action actually is telling. the fact that we got inventory numbers that suggests the u.s. is awash in crude oil, we are going to run out of storage ray quickly. -- storage very quickly.

crude oil actually rallied very hard yesterday. it's not doing a whole lot today. but it's telling. that kind of price action tells me that that is a known known. the market -- the selling is starting to exhaust itself. after a painful downside come i think there is a here, both in crude physicals and xle, the integrated names. >> crude has been resilient. well kind of difference does that kind of influence does it have on companies versus refiners? >> you are exactly right. there is a tremendous amount of churn and rotation within the space. because of that, i would rather stay with from most of that. i am not enough of an energy specter to dig into the granular part of that trade. i would rather stay broad and

stay with integrated names like chevron and exxon mobil, which dominate. because they have gotten so crushed in price, the dividend yield has gotten quite elevated. now you have one well north of the 10-year note. that wasn't the case at all for the last couple of years. in addition, you are not paying an expensive valuation. you are paying a slightly lower market. i think there is value here. >> steve cortez thank you very much. we have heard from so many people that the dividend is what is so attractive.

>> hello, everyone. investors placing bets on corporate deals. ecb president mario draghi lays out his stimulus plan which starts on monday. wall street is waiting on the first of two report cards on the health of the world's biggest banks. "street smart" starts now. first, a look at the top stories.