pimm fox: from bloomberg world headquarters in new york, i am pimm fox, in four mark crumpton. this is "bottom line" for friday, march 6, 2015. we have full coverage of financial markets and details on apple. scarlet fu, bloomberg chief market's correspondent, explains why it has taken so long for the world's most valuable company to join the dow. and peter cook is covering president obama and the commander in chief's view of today's better than asked acted

employment report -- expected employment report. a strong u.s. jobs are word for february -- jobs report for february. details of the report show the number of jobs created in the previous two months needs to be revised down by 18,000. the chairman of the president's council of economic advisers had this to say. >> we have now had 12 straight months of his is adding over -- businesses adding over 200,000 jobs each month. we have not seen since the 1970's. we are going through an extraordinary streak. we are keeping up the same pace this year. it is something most people did not expect. pimm fox: wages rose .1%. what does the report mean for interest rate policy?

here is bill gross. he'll grossbill gross: i don't think a jobs report like this importantly, as you point out, with the gains, i don't think it threatens inflation. it is far under what the fed needs. pimm fox: the 2% gain matches the increase since the economic rice began in 2009. john williams is a member of the policymaking committee who delivered a speech in honolulu today in which he said the u.s. will reach maximum employment by the end of the year or sooner, lifting wages and inflation area he said this is mind that -- inflation. he said this is a sign that the adderall reserve should raise

rate -- federal reserve should raise rates. the nation's outstanding debt will reach its statutory limit on march 16. he says he hopes congress and adjust the limit without controversy or brinksmanship. and nasa's spacecraft will be given a 16 month exploration of the asteroid belt between mars and jupiter. it previously visited the asteroid fessed up. in july, another spacecraft, new horizons will have its closest encounter with pluto. that is a little bit of today's top stories. apple stock will join dow jones industrial average when markets open for trading on thursday march 14. for more, here is scarlet fu.

scarlet fu: that's right. apple is in and it rose as much as 1.6% on the news. meantime at&t saw the biggest drop of the year. according to the guys who compile the index at dow jones, apple's inclusion was a long time coming. >> apple was an obvious choice for the dow. it is the largest company. it is a strong leading technology company. if anything, we have been getting comments over the last few years, why wasn't it in the dow? scarlet fu: the reason it was excluded was because of its split price of $525. apple would have been the most influential name by a long shot. right now, visa is the most influential and heavily weighted because its share price is $270.

goldman sachs is far off at $187. last year, apple split its stock 7-1. the reason the dow is taking the change now is because visa has a split that will take effect on march 18. apple's inclusion will help offset some of that. in the meantime at&t is the fourth smallest constituent in the dow jones industrial at 33 dollars, so it had a pretty small impact on the movement of the dow overall. pimm fox: thank you very much chief market correspondent on the inclusion of apple on the dow jones industrial average. for more on the jobs report, i'm joined by a chief economist at

standard & poor's in new york. welcome, beth. what stands out to you in today's jobs report. beth: first, i just want to say wow. we were surprised to see something close to 300,000 gains for february. we thought the weather would be a drag on it. we saw pretty much job gains across most sectors, so that is a positive. we are seeing more of a broad reach across the job readings. one of the concerns we want to note is that while it is nice to see the unemployment rate droppe, if you look at the detail, the reason that drop was the case is because a lot of people left the job market, a significant amount. that is not good for people or the economy. pimm fox: will today's report influence fed policy? beth: i think the fed is certainly watching every number

and will take a look at that. the jobs numbers are becoming like the new norm. the real reading is what is happening with wages. year over year 2% not a great reading for the fed. they want to see something stronger than that. there are also suggestions if you look at the income wage readings, they were a bit stronger. if you take out mining and particularly energy, they were stronger than that. i would expect a rate hike in june. pimm fox: june. what about consumer inflation? that is something the fed is also watching. beth: their baby when it comes to inflation rating is personal expenditure. that is food and fuel. it is currently 1.3 percent-one .4% year over year. they would like to the it closer

to 2%. they also don't want to get behind the curve. keep in mind that interest rates before the recession were at 1%. if they move it up now that is really just recessionary policy. pimm fox: can you explain any correlation between interest rates and the strength of the u.s. dollar? beth: it is not just interest rates. what we are looking at there is quantitative easing. the fed is looking at moving away from the balance sheet. they were adding about $80 million a month at the time and then they lowered it to zero. the balance sheet was one factor as well as quantitative easing. that's one reason the dollar was strong. another reason is what is happening on the other side of the pond. the eurozone. the ecb has started talking

about doing quantitative easing of their own. pimm fox: we are looking forward to the conclusion of the first quarter. what can you tell us about your insight into corporate profits? beth: well, we will see what happens with the weather. we were surprised it did not affect february numbers. we will see what it does to economic activity. it might delay some profits among corporations. i have to note that i am an economist not somebody who follows companies. i can say that while we might see a slowdown, i don't expect to see this recovery going away anytime soon. pimm fox: what is your take on energy prices and the price of oil? beth: the drop in oil was certainly a shock.

it was around 100 dollars in july. now it is holding around $50 in terms of the west texas spot. that is hurting some areas, particularly energy. as i mentioned a little while ago, overall, i do ask wages to -- expect wages to increase. but some of the drag is in the mining industry. i also think there will be a continued lack of investment in energy that will weigh on the sector in the region in terms of jobs. but the overall economy, it's a net gain for the economy. we still are net importers of oil, and if you go to the gas pump you can see that the money is staying in your pocket and not going to the pump. it gives people more money to spend, and certainly they are. pimm fox: thank you. let's go to president obama. he is speaking about the economy

and today's jobs report. he is in columbia, south carolina attending a town hall event and benedict college. president obama: i want to thank gianna for the big introduction. give her a round of applause. we have all kinds of luminaries and it carries, big shots. -- luminaries and dignitaries, big shots here today. i want to mention one of them, one of the finest legislators we have in the country, your congress in, jim clyburn -- congressman, jim clyburn. your outstanding mayor, steve engine and. -- benjamin. the president of this great institution, dr. david swinton. go tigers.

now. it has been a while since i was in south carolina. and act, it has -- in fact it has been too long. i am not going to lie. you know, i love you, and i have been loving you, it's just that i've had a lot of depth to do since i last year. -- last saw you. but it was wonderful to be backstage because i got a chance to see so many of the wonderful people i work with act in 2008. if it were not for this great state and all the people who, at a grassroots level, went door to door talked to folks, got everybody fired up and ready to go, if it had not been for all of you, i might not be president, and i am truly grateful for that. i hope that you don't mind i

also brought another good friend, the attorney general of the united states, eric holder. we decided to take a friday road trip together because eric has not only been a great friend but an extraordinary attorney general. as some of you know, he is going to go enjoy himself. he is going to retire from public service but i know he is still going to be doing great things around the country. i am really going to miss him. i am not here to make a long speech. i am here to make a short speech, because i want to spend most of my time interacting and taking questions. i want to hear what you guys are thinking about. this is a good thing for me to get out of washington and talk to normal folk. i thought it was important to

come here because tomorrow i will be visiting selma, alabama, for the 50th anniversary of the march across the bridge. one of the things i want to talk about -- i am still working on mice each, -- my speech but it might come up is the meaning of selma for your generation. because selma is not just about the past. selma is now. selma is about the courage of ordinary people doing extraordinary inks because they believe they can change the country and shape our -- store generic things -- extraordinary things because they believe they can change the country and shape

our future. it is about asking what we can do to make america better. historically, it has and people like you who have led that march. john lewis was 23 when he helped lead the march that changed the country. in birmingham, a 12-year-old boy who was elected head of the naacp youth chapter grew up to be jim clyburn. it was young people who stubbornly insisted on jobs stubbornly refused to accept the world as it is, and transformed not just the country, but transformed the word. you can see that reflect -- the world. you can see that reflected in the poster put out by the

nonviolence committee. it is john lewis kneeling by an all-white. -- all quite cowhite pool. it reads, " come let us build a new world together. " insisting we live up to our highest ideals our deepest values. that is why i want to come here to columbia and to benedict college, because we all know we still have work to do. we have to ensure not just the absence of formal, regal oppression but the presence of an active, dynamic opportunity,

good jobs that a good wages, a good start for every child health care for every family the higher education that prepares you for the world without leaving you with crippling debt, a fair and legal criminal justice system. [applause] now the good news is, we are in much better shape now than we were six years ago. this morning we learned that our economy created nearly 300,000 jobs last month and the animal diamond rate went down. -- unemployment rate went down to the lowest it has been since the spring of 2008. [applause] our businesses have now added more than 200,000 jobs a month for the past year and we have

not seen a streak like that in 37 years since jimmy carter was president. all told, over the past five years, our businesses have created nearly 12 million new jobs. what more the unemployment rate for african americans is falling faster than the overall and of limit rate, which makes sense -- overall unemployment rate which makes sense because it also rose faster. but it is still too high. the unemployment rate in north carolina is higher than we want, which means we still have work to do. we have to make sure there are good jobs that pay a living wage and benefits. we have to do everything we can to keep this progress going. this community is doing its part to prepare students for this new

economy. programs like youth build give young people a chance. city year is working with public schools to increase graduation rates. benedict college is doing outstanding work beyond your walls. we put you on the higher education community service honor roll. you earned that honor. so, along with your president, we are going to keep doing everything we can to make sure that young people like you can achieve your dreams. we cannot do it for you. you have to do it yourselves but we can give you the tools you need. we can give you a helping hand a sense of possibility and direction. you have to do the work, but we

can make it a little easier for you. that is why one year ago we launched "my brother's keeper." it is an initiative that challenges community to bring together nonprofits and businesses to create a pathway for young people to succeed. this week we put out a report showing the progress that has been made. nearly 200 local leaders have accepted the challenge. they are doing great work mentoring young people, giving them a new for success. i am hugely optimistic about the progress we can make this year and in the years ahead, because ultimately, i am off mystic about all of you -- i am optimistic about all of you.

young people in this country make me optimistic about the future we can build together and the world we can build together. im proud of you, but we have a lot of work to do, starting right now, because i am going to take your questions. thank you very much. pimm fox: president obama has been speaking in columbia, south carolina at a town hall meeting at benedict college, speaking about the 50th anniversary of the civil rights march in selma, alabama, and also talking about today's jobs report. let's go to peter cook for analysis. he continued to talk about the economy and the unemployment rate saying it remains to high and that too many people are left out of the benefits of the improving economy. peter cook: he is a president who is sounding a lot more comfortable about the economy and the recovery than he was

just a few weeks or months ago. the economy has turned a corner but it still has problems in places like south carolina where on them ointment is 65% -- unemployment is 6.5%. it is higher for african americans. he was speaking at an historically black college. but he is speaking with some confidence that the economy is doing much better. the 200,000 jobs plus over 12 months the last time we have seen that was 1977, that is a number the white house is talking about a lot today. pimm fox: inky very much, peter cook -- thank you very much peter cook, for monitoring the president's remarks. let's talk about debt. $14 million worth of debt was

sold by exxon. the last time energy companies sold in excess of $10 million was 2012. laura has been following this story, and she joins us now. it seems like at the beginning of the year, we saw the price of oil decline and a lot of companies got hit with a decline. companies were facing a cash crunch. laura: everybody is going in and trying to get more money and have more money go to work. what you identified was a little bit of a contrarian view out there. some people felt like the price was overpriced, and they were selling out a little bit. pimm fox: making some money taking the profit. laura: exactly. they were saying there is so

much money coming in. pimm fox: the amount of bonds issued by companies such as exxon or energy 21, is there anyway to understand in detail whether this is money that is going to be good or refinance later? laura: i don't know that we have one strategy. energy is so many different companies. drillers, servicers, even banks when it comes to houston or north dakota. you cannot find just one stream of consciousness there for strategy. on top of that, you have $250 billion of debt growing out there. pimm fox: are you seeing that people are starting to move into

different asset classes because the distressed debt market looks to be well picked over? laura: people are going to comb through those for opportunities. beyond that, maybe do direct lending. there are firms that have the capacity to do that. we are starting to see that. the other thing that is interesting is we are starting to see stressed strategies come out like loan to own. they are probably a little underpriced. if you believe oil prices are going to go higher, that's great . get those equity returns. pimm fox: now, those bonds that would then turn into equity would a bank or something like that change the disposition of the asset? laura: generally, for something that located, you're probably going to have to go into bankruptcy. pimm fox: and you are going to

be patient because it is going to take a long time. laura: yes. these are not necessarily restructuring events in 2015 maybe 2016, but you have to get in while the prices are good. pimm fox: based on the amount of money being spent on these kinds of investments, connect that with the debt being issued. our companies taking advantage of the fact that -- with the debt being issued, our companies taking advantage of the fact that this is the time to do it? laura: some of these are junk rated. go ahead. pimm fox: we want to know the details of always companies to invest in. thank you very much. coming up, white house in your advisor valerie jarrett talks about the obama administration's e-mail policy -- white house senior adviser valerie jarrett

talks about the obama administration's e-mail policy and whether hillary clinton broke any rules. that's coming up. ♪

clicks welcome to bottom line. i am pimm fox in for mark crumpton. let's take a look at our top stories. tghe justice department will charge robert menendez with criminal corruption. cnn start -- sites sources alleging the office was businesses of the democratic donor and friend in exchange for gifts. the expected charges will come

in the next few weeks the official said. let's check the rice of crude oil. down about two point 25% -- 2.25%. the news as at&t is out and apple is joining the dow jones. shares fell more than 4% and it has been in and out of the dow jones industrial average. inclusion is supposed to link a stock influence to its price per share. apples shares traded at 520 five dollars each indicating it might dominate the index. there are reports of fraud involving apple pay. that is the new pay system. banks will make changes to customers' credit.

some require users to telephone the banks to activatebanks -- banks require users to telephone the banks to activate apple pay. medical johnson added more than a million dollars worth of verbal livestock. the purchase demonstrates confidence in the future success, the company said. herbalife lost its -- half its value. an activist calls it a spirit would scheme. that is a look at today's top stories. sunday, march 8, is international women's day. market makers anchors erik schatzker spoke to valerie jarrett, the white house senior adviser in one of the obama family's oldest and dearest friends. they began by discussing the employment report. >> wages are going up so even if

the overall economy is doing better until it is reflected in your pocket books you're not going to feel better so what the president has been doing is looking for ways to increase rages -- wages. >> increasing the minimum wage would help for some people but what we see happening is the prosperity that the corporate sector and investors are enjoying in terms of profit and stock prices is not being passed on to ordinary americans. raising the minimum wage might help son but it is the middle class suffering as well. you have seen the statistics. middle-class incomes have been declining. what can the president do to fix that? >> the entire state of the union address this year was mostly directed to just that. we have to grow wages. that helps grow the economy. we need to make sure there -- the workforce is trained for the

jobs of tomorrow. we invest in education. the president made clear point of making community college free for the first couple years for students who are making -- taking their work seriously. infrastructure is very important. that creates jobs right away. we have been trying to get congress to focus on the needs of infrastructure. there is lots we can do if we can have congress as a partner but we are not going to wait and that is why the president is calling on mayors and governors around the country to do with they can do. when we talk about getting ready to celebrate women's day, there are 42 million americans who do not have a single paid 60 year. we have to start investigating and that is what will help get the economy. >> look at walmart, walmart is

raising the minimum wage and we have not seen that happen across government. >> you're saying it now happening in governments. there are cities that are passing laws raising the minimum wage. the private sector is important. we were very supportive. t.j. maxx also followed suit and the gap has followed suit. that is why the president put the spotlight on the us issue. we can raise issue and make sure we are leading by example. >> you are shining another spotlight, let girls learn. >> the president and first lady launched a new effort this week that is building on efforts that are ongoing throughout our administration and preceded but we will have the whole of government approach to ensure that all girls learn. there are currently 62 million girls in the world who are not

in school. the first lady has taken this on as her cause to put the spotlight on this issue and help remove the barriers that are keeping girls from school. it is the difference from being a survivor of human trafficking and turning your own business. the fact of the matter is when young girls have an education and the complete that education it is good for the economy and society and the world will be stronger and more vibrant and more safe when women are well educated. >> we need to ask about state department e-mail policy. you received e-mails from her. the president -- >> i did not. i have not received e-mails from secretary clinton. >> did members of the administration received e-mails? >> that i do not know. the president has a firm policy that e-mails should be kept on government systems.

he believes in transparency and the state department is working with the national archives to make sure that all of secretary clinton's e-mails are captured. >> does that mean she broke the policy? >> i differ to the state department. we leave it up to every single agency to determine how to it here to that policy. >> if someone on your staff was conducting white house business using their personal e-mail account, would you fire them? >> i do not want to get into a hypothetical. we have training on a continuous basis to make sure that our staff understand the importance of keeping it on the system. we believe in transparency and public records that they need to be captured. we constantly are having training to make sure they know what is going on and we encourage other agencies to do the same. >> valerie jarrett, obama administration advisor. ahead, the latin american

report. we go off the charts with color with -- scarlet fu. details next. ♪

>> bloomberg tv plus is available on roku tv and it is streaming free. you can also watch on your phone, tablet, and apple tv. it is time now for the latin american report. brazil reported the fastest acceleration in inflation in a decade. consumer prices in the largest economy rose 7.7% in the 12 months to february. the most since may of 2005. brazil's real currency has posted the biggest decline among major did -- currencies this year and the drop in the rail makes imports more expensive

area the government has allowed some regular prices to rise after posting its record budget deficit last year. that is your latin american report for today. next, encore. your guys with the most important newsmakers of the week on "bottom line or go."

>> it's time for today's top stories. the world's most valuable company is joining the dow jones average. apple replaces at&t on thursday march 19. the inclusion raises to six the number of technology companies in the 30 members of the dow industrial average. shares of at&t fell more than 4% last year. a strong jobs report for february. the u.s. economy added 295000 jobs well above the forecast. unemployment fell to 5.5%.

workers are not saying an increase in their hate checks. hourly earnings were up 1/10 of euro 1%. those are today's top stories. we do have some breaking news with the decline in equity prices. i want to go to the breaking news desk with scarlet fu. tell us about the sellout area >> as the day continues and we head toward the close we're looking at indexes accelerate their declines heading into the 4:00 p.m. close. look a -- take a look at the terminal. all drifting lower in the final march toward the close. when you look at the industry groups it is still very much segregated along the lights -- lines of stocks. dividend payers look less attractive in a rising interest rate environment. the jobs report putting the timetable back in the calendar for february increase that would appear to be something that savers financials and disfavors

other dividend payers. i was looking at the average in all 30 members of that measure are lower as well. if you look at what is going on in treasuries, 10 year yields are higher. i was speaking with peter sure -- and he said theat people are less inclined to move along those lines and pricing in one in interstate increase might need. also on the effective companies selling debt in using that to fund the stock buyback. and what that would mean for earnings going forward. >> thank you very much scarlet fu at the breaking news desk area -- news desk. at one point he was in line to become the next chief executive of intel. that was before he suffered a stroke. he has moved to raise money for

stroke awareness and victims and he has a $5,000 mind -- bicycle racing event today. tina fey has a new comedy. the show focuses on the woman who was freed from a doomsday called and has to adjust to modern-day life. it debuts on netflix. >> i am liz lemon so i am excited to see what tina fey brings elsewhere. they were not totally sold at nbc so they worked to go to

netflix and sold the show there. >> the same model where you pay $7.99 for all that you can eat that is something the broadcast networks it are experimenting with. >> cbs has been experimenting and hbo will do some kind of subscription service perhaps on apple tv or other areas as well like on consoles or that would be $15 a month. that would be to reach the corner cutters. i might cut the cord. everything i need would be on my apple tv. >> perhaps more relevant is it not only cuts the cord to the cable operators, it cuts the connection to the advertisers. >> interestingly enough, if you take a look at what netflix is

doing in that area, you can see movies and distribution. you can watch the same movie in the theater. >> for example, "the interview" on demand. >> what does that do? and the second "crouching tiger" movie. >.> we will forward -- look forward to more on "street smart" coming up. it is friday so we bring you encore, this is a look at the most nobleness makers from the last week on bottom line. >> i think trust but verify is the policy that the obama

administration is adopting for this negotiation. a major part of any agreement should one be reached would be interested of inspections on iran's program going far beyond traditional standards. trust and verify is part of the policy towards the negotiations. >> they have been selling poisonous wood in the have been trying to get alarmed -- around the law by coming up with their regimen which is not consistent with the standards they say they are following. they have been doing a different kind of test and claiming that they are in a tesla does not show the formaldehyde levels. they have come up with their own test mechanism not consistent with what scientists say is the right way to do it in the are trying to weasel their way out of this but it is not legitimate. >> the prime minister is wrong on these issues and president obama is right. the idea that the israeli prime minister came to derail these

negotiations which are not just u.s.-iran negotiation, this is u.s., u.k. france china, and germany. it is not as if this is a naive group and to come through this is absolutely inappropriate and the idea that you just told sanctions to try to undercut any chance of success and negotiations has been shown historically to be wrong time and time again. >> some companies have a difficult time quantifying the loss. with intellectual property is stolen the other issue is people do not know quite what to do. there are a lot of solutions out there but the question is which solution and how much do i need to spend and where we need to do some work is to lay out some clear standards and a roadmap so companies and even individuals know what they need to do and what they need to buy in order to protect their particular assets. >> coming up, scarlet fu has off

the charts next on "bottom line." ♪

>> apple will join the dow jones industrial index replacing at&t. joining me is scarlet fu. give us a little history lesson. >> we post a height of them -- hypothetical question.

if they could add apple when the bull market began. we will set the scene for you a little bit. there has not been that many changes to the dow industrials over the past five years. no changes in 2011. in 2012 united health came in and craft was taken out. goldman sachs replacing alcoa. no changes in 2014 and today apple will replace at&t effective march 19. we reached out to s&p and dow jones and they said they did not run the numbers so they could not answer a question but the presumption here is that the dow would have been higher. >> there is no shortage of math expertise. what are the results? >> one of our equity specialists ran the numbers and came up with

an approximation. let's show you the charter of the dow jones industrial average since the start of 2009. the y-axis is not the actual level. the dow jumps 162%. we figured out what would have happened in here is what he got. that is the yellow line, a bigger gain. 221% increase, a difference of 59 percentage points. this is an approximation and the chart reflects price appreciation of the dow's constituents. we not making a claim on where the dow would have been and this does not include reinvested dividends and all of that. >> whether it is the dow or the s&p, fund managers are matching the index. >> i have been looking at research that says that is not always the case.

it is the conventional wisdom but being added to the dow is not all it is cut out to be. he analyzed past editions like cisco and united health and chevron and found that since 2008, stocks that were added to the dow underperformed the return of the market. not the dow but the s&p. the reason is there is a lot of buying to the lead up of the conclusion and they are selling once it is a done deal. for apple because he covers apple, he said the next catalyst for the share price is not necessarily the apple watch that will -- we will hear more about on monday. but the use of cash. what it does with its dividends and buybacks and how that affects the share price going forward. >> remember to set your clock ahead and in anticipation of the

iwatch on the ninth. does anyone care or benchmark their results against the dow or do they go against the s&p 500? >> more money is benchmarked to the s&p 500 but the dow is -- resonates with them. there is more sentiment attached . >> thank you very much. the latest news always available on top of the hour streaming on your tablet and bloomberg.com. i am pimm fox. ♪

>> welcome to the most important hour of the session. i am alix steel and this is "street smart." investors bet on when the federal reserve might hike interest rates. a strong job report adding to speculation as to what the fed will do. and the most important months. i will write it down -- break it down. "street smart" starts right now. here are the top stories we are watching ahead of the closing bell. blue crest capital fired one of its money