>> live from bloomberg headquarters in new york, this is "market makers." stephanie: the first person to officially enter the race for the white house. matt: the pizza chain that is targeting the upper crust. california pizza kitchen goes uppercrust. i'm matt miller. olivia: i'm olivia sterns. i'm so excited about ted cruz. matt: are you excited about ted cruz? olivia: i'm excited about ted cruz. i'm excited about existing home sales. scarlet: the sale of previously

owned homes is falling short. the consensus among economists we surveyed was four point -- 4.9 million. economists were looking for a 1.7% rise. that had been ratcheted down from last week. existing home sales are tallied only when purchases are closed. they do account for more than 90% of the u.s. residential market. perhaps harsh weather played a role for the disappointing read. when it comes to effect on the market stocks are not showing much change from this latest report. the dollar remains weaker. the 10 year yield is pretty much where it was before. off its low, certainly. this kicks off a week of lots of housing numbers. we will have that for you

throughout the week. matt: thank you so much. we will dig deeper into that story in just a moment. olivia: let's start with the bulletin. the top business stories that you should be watching. this week could prove decisive for greece. prime minister tsipras is meeting with angela merkel this week. the bailout money is not likely to happen unless tsipras can spell out the reforms his government will undertake. ted cruz has tweeted his way into the 2016 presidential race. a little left of midnight, the republican senator from texas became the first major candidate to announce he is running. senator cruz: it is a time for truth. a time to rise to the challenge just as americans have always done. i believe in america and her people and i believe we can stand up and restore our promise. olivia: ted cruz will formally

launch his campaign at liberty university in lynchburg, virginia. he has been an outspoken critic of obamacare. he once spoke out against it on the floor of the senate for 21 hours straight. vivendi has rejected a call to spin off its music business. universal music was suggested to be spun off. vivendi will examine another proposal to raise the dividend. the fate of radioshack may be decided at a bankruptcy auction that begins today. they have proposed saving 1700 radioshack stores. other companies want to liquidate the remaining assets. a bankruptcy judge will make the decision. march madness now we are down to the sweet 16. a pair of number two seeds lost.

wichita state beat kansas. it was the first meeting between the two schools in 22 years. michigan state beat virginia 60-54. the spartans will face oklahoma in the east regional semifinals. matt, i am going sooners all the way. matt: you are? olivia: yes. all the way. matt: i am not winning in my bracket challenge, although i was on friday. olivia: congratulations. matt: to get back to the housing story, let's take the temperature of the markets. we head into the spring selling season. our economics editor, dead last in the bracket challenge, is here with us. he is much better at econ. susan joins us as well. her estimate was almost exactly right. very good guessing there.

mike i want to go to you first. you have a bull and bear case. mike: if my teams had one, my bracket would look a whole lot better -- hasd won, my bracket would have looked a whole lot better. you get all of the news you need from the weather report. going forward, the weather fades away. we get into the spring selling season. there are reasons for optimism and pessimism and they balance each other out. reasons for pessimism at this point -- start with the fed. they say they are going to raise interest rates. that means mortgage rates are going to go up. we are at 3.8%. how is that going to affect people? mortgage credit still remains tight. price gains are slowing. that is going to restrain inventory. it is still at very low levels.

without a lot of houses for sale, you don't see as much turnover. reasons for optimism, consumer confidence -- jobs have been going off the charts. we are starting to see some income increases which means people will have more money available. rents continue to rise. rents are getting so expensive that it makes housing look a little more worthwhile. household formation. we are waiting for you to guys to go out and get married. [laughter] olivia: no. both of us are -- mike: everybody stayed home and lived with mom and dad and now people are starting to form households. matt: that sounds pretty positive. professor, let me ask you, if we have the fed possibly going to raise rates, that has to be impetus. if you have rent going up, that has to be impetus.

if wages are going up that has to be in the'tis. are we going to see a big bounce back? >> i don't see a big bounce back. i see spring coming and the weather turning, but i think it is more than the weather. i think it is a strained mortgage market. i am sort of in the middle of the road where we just heard. there are pluses and minuses. interestingly, once rates start going up, that could be a plus. counterintuitively, you start buying when you see rates on the rise. that is a push to get going. olivia: if rates to go back up to 5%, as they low is saying they will, you don't think that will cut the life of the housing recovery? >> i do, if it happens precipitously. there are lots of reasons why the fed is going to postpone postpone. i see the start of a rise, the low start of a rise that could

help bring the market back to strength. otherwise, i see slow, steady recovery continuing in this market. olivia: mike, it feels like a tale of two housing markets because we have new home sales surging and we have existing home sales coming up a little bit soggy. what is going on? mike: the new home sales is much smaller and it has not an has affected as much by the weather, but it was recently. now, we will start to see them balance out as the seasons get underway. the new homes market, they cut prices a lot. they raised home prices significantly. now they are pushing less expensive homes and we have seen a big rise in existing home sale prices. that should start to even out. matt: does raising interest rates have any positive effect? i can't imagine that a 50 basis point increase to interest rates would dissuade anyone really from getting a mortgage?

i can imagine that the idea that interest rates are going to go up further and further would get someone into the market who was on the fence. >> you are absolutely right. i see 25 basis points as a positive but it is getting to the 5% that is a problem. the initial response is going to be a plus for the market. olivia: we were joking earlier about household formation, but the trend is clearly real. it is at its lowest level since the 1990's. are we beginning to see that turnaround? >> yes we are, but that turnaround is happening, but it is not a spectacular takeoff and we still have millions of households out there on the sidelines, who are still living with their parents, their friends. that eventually can be a source of readout gains in the market. for now, it is still on the sideline. matt: a lot of them are renting.

you think the rental market is going continue to go well. when is that going to push people out of apartments and into homes to own? >> well, the constraints mortgage market is a problem here. the millenials have made their move. they are behind a surge of rental and that will continue and we will see the constraint mortgage market continue. that is a longer run trend. i don't see that resolving through the spring. olivia: of course these are aggregated national numbers, but the housing story in the u.s. is different from region to region. what margin -- part of the country are you most concerned about? >> the south is actually doing really well. we are beginning to see affordability problems in part of the west. that is a question mark. the economy is really strong in the west. it depends on the underlying economy. the northeast's high wages, high

housing prices, slow growth. matt: mike, how far have we come from the bottom? have we come anywhere? mike: it is a very interesting point. you don't want to go back to where we were before the financial crisis because that was a bubble. so how high up do you want to go? existing home sales are getting close to a level that people think is reasonably normal 5 million annual rate. we are a little bit below that. it is the new home sales that are still way, way below what we saw before. a lot of those are going to be starter homes and that reflects the idea that we are not seeing as much household formation. olivia: ben bernanke was joking that he could not even get a mortgage. how strong is credit demand? mike: credit demand is stronger than credit availability. you have to have excellent credit to qualify for a reasonable mortgage and that is much higher historically -- then

historically. if you could get $250,000 per speech like ben bernanke, you probably don't even need a mortgage. matt: princeton professors are not reliable credit risks. thank you so much for joining us. we really appreciate it. mike mckee, always a pleasure regardless of how you are doing in the bracket challenge. olivia: still to come, matt and i are just getting started. we will head down to lynchburg virginia. ted cruz has made it official. he is running for president. we will have live coverage. mark halperin and john heilemann will be anchoring coverage online. ♪

matt: time to bring you up-to-date on the top stories of the morning. sales of previously owned homes came up short for a second month in a row. sales were up one .2% in february but below in annual sales rate of 5 million homes. the real estate industry is struggling because of higher prices and a lack of inventory. the president of the cleveland fed says in interest-rate hike in june remains a possibility. she told the fed's removal of the word patients made to june -- patience made june a viable option. >> we are not on a preset path. this is a new way of doing

policy. we are data dependent. we set the interest rate for what the economy can support. matt: last week, janet yellen said next month is unlikely for a rate hike but june should not be ruled out completely. singapore its first elected prime minister is being hailed as a political giant and will turn the city state into an economic powerhouse. he died at the age of 91 and he was prime minister for 31 years. that time included a split with malaysia and separation from great britain. coming up in 10 minutes' time, ted cruz has become the first two declare his -- first to declare his candidacy for the republican nomination for president.

california pizza kitchen goes upscale. we will talk with the ceo of the fast casual dining group to see if he will move it to just plain casual. [laughter] olivia: as you know by now, ted cruz is in. the freshman senator launches his bid for president with this hour with a speech at liberty university in lynchburg, virginia. he is the first candidate to jump into the 2016 presidential race among making an official in a -- race, making it official in a campaign video. senator cruz. if you want more of the same there will be plenty to choose from. i hope i can earn your support. olivia: we will have live coverage of the speech right here on bloomberg television. we want to bring in our chief washington correspondent peter cook. peter, we have ian bremmer on

"surveillance" earlier being a little bit flippant saying he can increase the speaker fees that he charges. on a more serious note -- matt: that sounds pretty serious. olivia: is ted cruz a viable national candidate? peter: anyone with his name recognition and grassroots support is a viable candidate in the republican fight for the nomination particularly because the early states like iowa and south carolina are places like conservatives like ted cruz can play. he is no slouch when it comes to debating. he is a smart guy. everyone knows that. he may be too conservative to win the general election. that is why big republican donors have held off giving him their blessing. the big question is, can he raced the kind of money? matt: i've got to break in. we are going to toss to mark halperin and john heilemann. they are doing live coverage of ted cruz's speech at liberty

university. you can follow it on our website, but we are going to live stream some of that right now. guys. >> this is his announcement speech for president of the united states. the first major candidate to get into the race. some of you are joining us on bloomberg television. i mark halperin with john heilemann live for this speech. he is now with the podium. let's listen in. senator cruz: god bless liberty university. [applause] senator cruz: i'm thrilled to join you today at the largest christian university in the world. [applause] senator cruz: today, i want to talk with you about the promise

of america. imagine your parents when they were children. imagine a little girl growing up in wilmington, delaware. [applause] senator cruz: it is during world war ii. the daughter of irish and italian catholic family. working class. her uncle ran numbers in wilmington. she grew up with dozens of cousins because her mom was the second youngest of 17 kids. she had a difficult father. a man who drank far too much and , frankly, did not think that women should be educated. and yet this young girl, pretty

and shy, was driven, was bright, was inquisitive. she became the first person in her family ever to go to college. in 1956, my mom graduated from rice university with a degree in math and became a pioneering computer programmer in the 1950's and 1960's. [applause] senator cruz: imagine a teenage boy. not much younger than many of you here today. growing up in cuba. [applause] [laughter] senator cruz: jet black hair, skinny as a rail.

[laughter] senator cruz: involved in student council and yet cuba was not at a peaceful time, the dictator batista was corrupt. he was oppressive. this teenage boy joined a revolution he joined the revolution against batista. he began fighting he began fighting with other teenagers to free cuba from the dictator. this boy, at age 17, finds himself thrown in prison. finds himself tortured, beaten and then at age 18, he flees cuba. he comes to america.

imagine for a second the hope that was in his heart as he rode that ferryboat across to key west and got on a greyhound bus to head to austin, texas. to begin working washing dishes making $.50 per hour, coming to the one landowner that has what -- land on earth that has welcomed so many millions. when my dad came to america in 1957, he could not have imagined what lay in store for him. imagine a young married couple. living together in the 1970's. nine are one of them has a personal relationship with jesus -- neither one of them has a

personal relationship with jesus. they have a little boy and they are both drinking far too much. they are living a fast life. when i was three my father decided to leave my mother and me. we were living in calgary at the time. he got on a plane and flew back to texas. he decided he did not want to be married anymore. he decided he did not want to be a father to his three-year-old son. yet, when he was in houston, a friend, a colleague from the oil and gas business invited him to a bible study. invited him to clay road baptist church. there, my father gave his life to jesus christ. [applause] senator cruz: and god

transformed his heart and he drove to the airport, he bought a plane ticket nt he flew back to be with my mother and me. [applause] senator cruz: there are people who wonder if faith israel. -- if faith is real. i can tell you in my family there is not a second of doubt because were written not for the transformative love of jesus christ, i would have been saved and i would have been raised by a single mom without my father in the household. imagine another little girl living in africa, in kenyan nigeria. [applause]

senator cruz: this is a diverse crowd. [laughter] senator cruz: playing with kids. they spoke what he laid -- swah ili, she spoke english. [applause] [laughter] senator cruz: coming back to california. [applause] senator cruz: where her parents who had been missionaries in africa raised her on the central coast. she starts a small business when she is in grade school, making bread. she calls it heidi's bakery. she and her brother compete making bread. they make thousands of loaves of bread and they go to the local apple lorch erred, where they sell the bread to people coming to pick apples. she goes on to a career in business, excelling and rising

to the highest pinnacles. and then heidi becomes my wife and my very best friend in the world. [applause] senator cruz: heidi becomes an incredible mom to our two precious little girls caroline and catherine, the joys and loves of our life. [applause] senator cruz: imagine another teenage boy being raised in houston, hearing stories from his dad about prison and torture in cuba, hearing stories about

how fragile liberty is beginning to study the united states constitution learning about the incredible protections we have in this country that protect the god-given liberty of every american. experiencing challenges at home. the mid-1980's oil crisis crater. his parents business go bankrupt . heading off to school over 1000 miles away from home at a place where he knew nobody where he was alone and scared. his parents going through bankruptcy meant there was no financial support at home, so at the age of 17 he went to get to jobs -- two jobs to help pay his way through school.

he took over $100,000 in school loans loans i suspect a lot of y'all can relate to. [laughter] senator cruz: loans that i will point out i just paid off a few years ago. [applause] senator cruz: these are all of our stories. these are who we are as americans. and yet for so many americans the promise of america seems more and more distant. what is the promise of america? the idea that the root -- the idea, the revolutionary idea that this country was founded upon which is that our rights do not come from man, they come from god almighty. [applause]

that the purpose of the constitution, as thomas jefferson put it, is to serve as change to bind the mischief of government. [applause] senator cruz: the incredible opportunity of the american dream what has enabled millions of people from all over the world to come to america with nothing and to achieve anything. and then come of the american exceptionalism that has made this nation a clarion voice for freedom in the world, a shining city on a hill. that is the promise of america. that is what makes this nation and indispensable nation, a

unique nation in the history of the world. and yet, so many fear that that promise is unattainable today. so many fear it is slipping away from our hands. i want to talk to you this morning about reigniting the promise of america. 240 years ago, on this very day a 38-year-old lawyer named patrick henry -- [applause] senator cruz: -- stood up 100 miles from here in richmond, virginia and said "give me liberty or give me death." [applause] senator cruz: i want to ask each

of you to imagine imagine millions of courageous conservatives all across america rising up together to say in unison "we demand our liberty." [applause] senator cruz: today roughly half of born-again christians are not voting. they are staying home. imagine instead millions of people of faith all across america coming out to the polls and voting our values. today, millions of young people

are scared worried about the future worried what the future will hold. imagine millions of young people coming together and standing together saying, we will stand for liberty. [applause] senator cruz: think just how different the world would be. imagine instead of economic stagnation booming economic growth. [applause] senator cruz: instead of small businesses going out of business at record numbers, imagine small business is growing and prospering. imagine young people coming out of school with 4, 5, 6 job offers. [applause]

senator cruz: imagine innovation thriving on the internet as government regulators and tax collectors are kept at bay and more and more opportunity is created. [applause] senator cruz: imagine america finally becoming energy self-sufficient as millions and millions of high-paying jobs are created. [applause] senator cruz: five years ago today, the president signed obamacare into law. [buooing] senator cruz: within hours liberty university went to court filing a lawsuit against it. [applause]

senator cruz: instead of the joblessness instead of the millions forced into part-time work, instead of the millions who have lost their health insurance, lost their doctors and faced skyrocketing health insurance premiums imagine in 2017, a new president signing legislation repealing every word of obamacare. [applause] senator cruz: imagine health care reform that keeps government out of the way between you and your doctor and makes health insurance personal and affordable and portable. [applause]

senator cruz: instead of a tax code that crushes innovation that imposes burdens on families struggling to make ends meet imagine a simple flat tax. that lets every american fill out his or her taxes on a postcard. [applause] senator cruz: imagine a polishing the irs -- abolishing the irs. instead of the lawlessness and

the president's unconstitutional executive amnesty, imagine a president that finally, finally, finally secures the borders. [applause] senator cruz: and imagine a legal immigration system that welcomes and celebrates those that come to achieve the american dream. instead of a federal government that wages an assault on our religious liberty that goes after hobby lobby, that goes after the little sisters of the poor, that goes after liberty university, imagine a federal government that stands for the first amendment rights of every american. [applause]

senator cruz: instead of a federal government that works to undermine our values, imagine a federal government that works to defend the sanctity of human life. [applause] senator cruz: and to uphold the sacramento marriage. -- the sacrament of of marriage. instead of a government that works to undermine our second amendment rights, that seeks to ban our ammunition imagine a federal government that protects the right to keep and bear arms.

[applause] senator cruz: instead of a government that seizes your e-mails and your cell phones imagine a federal government that protects the privacy rights of every american. [applause] senator cruz: instead of a federal government that seeks to dictate school curriculum through common core -- [applause] senator cruz: -- imagine repealing every word of common core. [applause] senator cruz: imagine and embracing school choice, the civil rights issue of the next

generation. that every single child regardless of race, regardless of ethnicity, regardless of wealth or zip code, every child in america has a right to a quality education. [applause] senator cruz: and that is true from all of the above, whether it is a public school or charter school or private school or christian school or parochial school or homeless school -- every child. instead of a president who boycotts prime minister netanyahu imagine a president who stands unapologetically with the nation of israel. [applause]

[applause] senator cruz: instead of a president who seeks to go to the united nations to end run congress and the american people, imagine a president who says, i will honor the constitution and, under no circumstances will iran be allowed to acquire a nuclear weapon. [applause] senator cruz: imagine a

president who says, we will stand up and defeat radical islamic terrorism. and we will call it by its name. we will defend the united states of america. now all of these seem difficult. indeed, to some, they may seem unimaginable. and yet, if you look in the history of our country imagine it is 1775 and you and i, we are sitting there in richmond listening to patrick henry say "give me liberty or give me death." imagine it is 1776 and we were

watching the 54 signers of the declaration of independence stand together and pledged their lives, their fortunes, and their sacred honor to igniting the promise of america. imagine it was 1777 and we were watching general washington as he lost battle after battle after battle in the freezing cold, as soldiers with no shoes were dying fighting for freedom against the most powerful army in the world. that, too, seemed unimaginable. imagine it is 1933 and we were listening to franklin delano roosevelt tell america, at a time of crushing depression, at a time of a gathering storm abroad that we have nothing to fear but fear itself.

imagine it is 1979 and you and i were listening to ronald reagan -- [applause] senator cruz: -- and he was telling us that we would cut the top marginal tax rates from 70% all the way down to 28%, that we would go from crushing stagnation to booming economic growth two millions being lifted out of poverty and into prosperity and abundance, that the very day he was sworn in our hostages who were languishing in iran would be released. and that within a decade, we would win the cold war and tear the berlin wall to the ground. that would have seemed unimaginable.

and yet, with the grace of god that is exactly what happened. [applause] senator cruz: from the don of this country and at every stage -- the dawn of this country and at every stage, america has enjoyed god's providential blessing. over and over again, when we faced impossible odds, the american people rose to the challenge. you know, compared to that repealing obama care and abolishing the irs ain't all that tough. [laughter] senator cruz: the power of the american people, when we rise up and stand for liberty knows no bounds. [applause]

senator cruz: if you are ready to join a grassroots army across this nation coming together and standing for liberty i'm going to ask you to break a rule here today and to take out your cell phones and to text the word "constitution" to the number 337 33. you can also text "imagine." we are versatile." [laughter] senator cruz: once again, text "constitution" to 33733. god's blessing has been on america from the very beginning of this nation and i believe god is not done with america yet.

[applause] senator cruz: i believe in you. i believe in the power of millions of courageous conservatives rising up to reignite the promise of america. that is why today, i am announcing that i am running for president of the united states. [applause] [applause] [applause]

senator cruz: it is a time for truth. it is a time for liberty. it is a time to reclaim the constitution of the united states. i am honored to stand with each and every one of you courageous conservatives as we come together to reclaim the promise of america, to reclaim the mandate the hope and opportunity for our children and our children's children. we stand together for liberty. [applause]

senator cruz: this is our fight. the answer will not come from washington. it will come only from the men and women across this country from men and women from people of faith, from lovers of liberty, from people who respect the constitution. it will only come as it has come at every other time of challenge from this country, when the american people stand together and say, we will get back to the principles that have made this country great, we will get back and restore that shining city on a hill that is the united states of america. thank you and god bless you. [applause] ♪ >> well, when you want your

presidential campaign announcement is to show the country who you are and what you are about and what you think your strengths are i think ted cruz pulled it off there. less a conventional announcement speech and more of a mega church sermon. there he is on stage with his wife and his daughters. a rousing conversation. as best we could tell, a teleprompter-less announcement speech. >> yes, there have been people who have said the ted cruz is the rock star of the right. there is certainly a quality there. prowling the stage. speaking to four different sides of this arena. as you said, seemingly without teleprompters, seemingly without notes, doing that from memory,

on pure style, a very strong performance, i think. you and i have both talked about ted cruz's need to project some optimism. there was some of that there. there was a lot of biography. he opened with biographical details, telling his family's story in compelling detail. i think we are lacking programmatic. there was a lot of abolishing and a lot of tearing down and a lot of repealing, not a lot of affirmative vision for what he would do as president. he does not have to do it all in the first speech. very strong on style. a little less strong on substance. he shows that he has the game, as a performer to be a real factor in the race. >> the language that he used speaking from memory, he is a very good speaker from memory without notes. that is his preferred method. i don't ever recall seeing anyone giving a presidential

announcement to that effect and without a podium. wandering around the stage. >> a little madonna mike on there. it is something to watch. he is among the many republicans who are going to be competing for the republican nomination. not a lot can do that. >> talk about some issues that people will start to size them up compared to other potential candidates. this is a guy who was not ever going to be the establishment favorite, but he and his favorite -- advisers believe he can be the republican nominee by raising sufficient amounts of money from the grassroots and his super pac, as well as a robust message about the three legs of ronald reagan's conservative stool. this speech today will be followed by many more just like it all over the country. >> two things we learned from

the speech about the choice of liberty university is a venue, one of which is that it works out really well in terms of invoking liberty as a theme to do it in a venue that is called liberty. you get a rousing cheer every time you invoke liberty and of the second, ted cruz, many of us had forgotten about this, that liberty university filed a lawsuit against the affordable care act and he was able to invoke that and get a big applause line. many of us were puzzling why he was puzzling -- why he was doing it here. >> as we have covered ted cruz, one of the things we have looked at with great interest is whether he would be more optimistic. the big word in the speech today, the refrains were led by the word "imagine." a lot of people associate that word with john lennon, who i suspect would not be a big ted cruz man, were he still alive. [laughter] >> that notion of imagine and thinking about a better future is the essence of optimism and i suspect we will hear that word

throughout the campaign and in advertising. >> the question for a guy like this, ted cruz, who as we say has strengths and weaknesses, is whether you you open yourself up to parity. there are people who will parity himody him on the left. does this ring close enough to our image of ted cruz? we want to be visionary, but feel natural to the person. ted cruz has created a public image for himself in a limited time he has been in the senate not of that kind of person. he is trying to reframe himself in a certain way. the question is whether that will have traction and seem plausible within the republican party. >> he will go through iowa. we will see if that type of speech plays well with iowa voters. it involves beating people like

rand paul, mike huckabee, rick santorum, scott walker, other candidates who will be appealing to the same kind of republican nomination voters. he talked about protecting citizens from the government in terms of surveillance. that is a play for rand paul voters. very strong against common core. that is a play to be the anti-jeb bush candidate, as well. olivia: thank you so much. quite a debut for ted cruz. launching his bid for the republican bid for president. you can continue watching coverage live online. matt: i hope john heilemann brings his wu-tang clan shirt if he ever interviews ted cruz. i'm not sure what ted cruz thinks about the wu-tang clan. maybe he is a fan. "market makers" is going to take a break. we will tell you about a new strategy for the california pizza kitchen. the chain wants to go upscale. we will talk to cpk's ceo.

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>> live from bloomberg headquarters in new york, this is "rocket makers" with erik schatzker stephanie ruhle. >> time is running out for greece and so is money. the greek prime minister goes to germany to try to get the bailout he needs before going broke. olivia: and we will talk with the ceo of cpk. matt: imagine a world where russia is falling apart. it's just one of the global threats in the next decade. we will talk to the head of the forecasting firm who came up with a list in the next 10 years.

i'm matt miller. olivia: and i'm olivia sterns. we are in for erik schatzker and stephanie ruhle. matt: existing home sales fell short of the 5 million annual rate for the second month in a row. there's a combination of factors going on. home prices have been rising and there is not enough inventory out there. loretta messer says june rate increase is a possibility. messer told bloomberg tv she's more outlook about economic activity but any information is still driven by data. mester: we will look at how -- at the outlook and how to move on the data. it gives us more option outing. matt: and an interest rate hike in june should not be completely ruled out.

and an iconic ran in baseball has been sold to a foreigner. louisville slugger, the price was $70 million all in cash. they own a number of sporting goods brands already, including wilson. secretary kerry has not finished the finish line -- reach the finish line in the nuclear talks. meanwhile, in an interview with the huffington post, president obama said there was still a major sticking point. president obama: what will have an impact on whether we get a deal done is one, iran needs to be prepared to show it is not developing a nuclear weapon, and whether we can verify that in an intrusive and consistent way. matt: as part of any deal, the u.s. and europe want sanctions -- as part of any deal iran

wants sanctions to end immediately. the u.s. is said to be balking at that. ted cruz's spoke at -- ted cruz spoke at a baptist university and said his vision for presidency is about reigniting america. ted cruz: it is a time for truth. it's a time for liberty. it is a time to reclaim the constitution of the united states. matt: cruz was elected to the senate in 2012 with the help of the tea party. meanwhile, an insider says his wife, heidi, has taken an unpaid leave from goldman sachs. heidi is a managing director at goldman in houston. and starbucks has backed away from its first stage of controversial efforts to spur relations about race. they will no longer right the words "race together" on their

cups. the company will still hold employee forums and commit to adding stores in urban communities. olivia: prime minister alexis tsipras will meet with his german counterpart, angela merkel. it's the second meeting between them in five days as greece lose ever closer to bankruptcy. hans nichols is our man in berlin and joins us now. we have so many one minute to midnight moments here with greece. do we know when they will actually run out of cash? hans: no, and that is part of the uncertainty. we cannot make it to the end of the day is what mr. tsipras said last week in brussels. he said it would be impossible for them to make their debt payments and -- if they don't get a nuother tranche of the bailout.

the living we know, they have about $1.6 billion they need to pay at the end of the week. they need to pay pensions and salaries. it looks like they have that covered, but starting in early april they could run into real difficulty. olivia: how much support is there in germany for a third bailout for greece? hans: very little, right? to even get to the conversation of a third bailout, you need to get through these what was four months starting february 20 when a signed agreement, and now it's closer to three months. how is greece going to implement the reforms of the old bailout program? when will they come up with a list? greece expects to submit a list by the end of the wii, but at that point we party lost five or six weeks. -- by the end of the week, but at that point we have already lost five or six weeks will.

brussels wants to know when they will implement the reforms they have talked about and only when they show concrete steps toward those reforms will they get any additional support and money. mario draghi is speaking right now and has some pretty harsh comments directed to greece. he says the total outstanding loans to the greek banks, 104 billion euros. he says it is a bit rich for the -- for greece to accuse the ecb of blackmail. which is a comment that mr. varoufakis made couple of weeks ago in the press. matt: you are in berlin. the last and i was in germany a few months ago, greece was not a popular country. -- the last time i was in germany a few months ago, greece was not popular country. what is the feeling on the ground? hans: the direction is toward negativity. on the question of whether or not reese should -- greece should leave the row is now

creeping up into the upper 50 pots. the direction is clearly anti-greece. the direction, the wind, those things matter. olivia: what is the latest on the actual reforms that the press is going to put forward. -- that's the press is going to put forward. -- tsipras is going to put forward a? nothing before looked like something angela merkel could take seriously. what has changed since then? hans: nothing. the countries involved want to see a list that is going to be implemented in good faith. they simply have not seen that. olivia: hans nichols, thank you so much, joining us from berlin. that: coming up, more than just a branding change.

california pizza kitchen is going upscale. we will talk to the ceo. olivia: plus, who will be europe's strongmen in the next 10 years? it might not be germany anymore. ♪

olivia: welcome back to "market makers," and we start with the top stories of the morning. the rebels in yemen have seized the third-largest city. have accuse the leader of being in the with united states. 125 special operations advisers have been removed from yemen. it has been considered blow to

the counterterrorism campaign. and prime minister alexis tsipras in greece is meeting with angela merkel and other leaders for the next two days. he wants them to come through with money promised in a bailout package, but it's not likely to happen unless alexis tsipras can spell out the reforms his government will take. they could run out of cash in just a few weeks. " francis says all he would like to do is go to a pizzeria without being recognized. since that's not going to happen look at what happened on sunday. the beat serena -- a pizzeria owner ran to the books medicaid -- motorcade and handed him a pizza. no word yet on whether the pope actually had a bite. and president loretto minister says she's more optimistic about

the outlook for the economy. loretta mester: we will assess the outlook and then move on the data. again, gives us more option alley. glad you got the options and -- >> you got the options and downgraded. do you really believe the u.s. economy is that strong? markets going to this frenetic moment every time someone mentions a rate hike. is it really that strong? mester: i was thinking the way i interpreted that way the dots were changing, we knocked down -- we marked down near term. i think the many transitory impacts of whether the u.s. is terribly impactful.

never west coast foreclosures -- there were west coast foreclosures -- sports closures -- there were west coast port closures. i see business balance sheet looking good, banks are recapitalized. i see some strength in the economy. yes, lower oil prices will change the amount of money invested in the oil sector and lower that, but the rest of the economy in terms of consumer spending, that is a tailwind. i am more cap for this -- i am more positive about the u.s. economy. matt: let's go out to the newsroom with scarlet fu to get a look at the new movers today. scarlet: kansas city southern is the worst performer in the s&p 500, down as much as 8% on almost double the average volume.

what happened yet how they now see low digit growth for the rest of the year. slowing sales and the reason is because of the plunge in oil prices. slower growth in the energy sector. a 20% declining coal revenue. also the stronger dollar at play. the weaker mecca -- the weaker mexican peso is also affected. this is one of our most popular functions, relative go on the bloomberg terminal. i know it is difficult to see here, but this column right here, the percentage change for today indicates that kansas city southern is off by 7% and the red here shows a decline in the canadian and other u.s. rail companies. they are all falling on the back of his reduced forecast. kansas city southern has a pollen -- has fallen almost 10%

in the past month. union pacific off by 7%. csx of by 6%. kansas city southern has had a 20% growth in the past year, rivaled only by canadian rails. if you look at u.s. rails, 9% down to 3.4%. i want to highlight union pacific, up by 3.2%. b moe capital markets wrote a note saying that the kansas city southern -- excuse me universe of it is the pacific rails and that canadian rails actually have some of -- of side -- have some upside. something to consider if you are switching between the different rail companies here.

that: when you think asu, i think about my bracket. scarlet: kansas state. everyone else's thinking about kansas city southern and your think it about university. matt: you are not in the bracket? scarlet: i do not know much about ncaa basketball. and while i run -- i realize there is no necessity for that to flat out the bracket. matt: nothing. scarlet: my think right now is the badgers because jamie, my producer is an alum. matt: i'm going with kentucky. you don't have kentucky. olivia: no, i've got wisconsin and the sinners. i the only one. -- and the sooners. i'm the only one. matt: the dax is down one full

percent. olivia: the story in europe overall is that equity markets have been ripping and crossing 7000 for the first time ever just last week. the dax is up more than 21% since the start of the year. that is incredible. it is march 23. matt: it is the highest it's ever been concise started my career here at bloomberg 15 years ago. in the year 2000, that is the first time you saw the dax up here. and of course, thinking crashing down, which i started covering for germany, the miller mark. olivia: the matt miller benchmark, i love it. if you are an american investor buying those stocks in dollars because of the enormous euro-dollar move, you actually have been making about 20%. net: -- matt: right here you can

see the euro is at 1.882. olivia: deutsche bank thinks we are going back to 1.85 by the end of the year. matt: what you go that is crazy -- what? that is crazy. loose nuclear weapons is one of the risks the world faces in the next decade. ♪

olivia: business is taking off with major tailwind for private jets. i hitched a ride with the ceo of xo jet. insiders know it at the fastest

ride money can buy. if you've got money to spare, but no time to waste, there's only one way to fly, the cessna citation 10. quite intimate with one purpose to create the fastest lane not operated by the u.s. military. olivia: it looks like a fighter jet. craig is the current ceo of xo jet. craig: people want to fly for three or four hours of more. they tend to buy -- fly for business rather than pleasure. they tend to be men and women who run their own company and need that extra 30 to 45 minutes , which for them become citizens between making the job work or not. olivia: it's like the 700 miles per hour. the right time from teterboro to

l.a., four hours on the dot. a commercial flight at six hours will still cost you several grand. can also fly deslauriers challenger. -- the bombardier challenger. credit: integrate plane to go to the mountains or to the islands. olivia: you're looking at about five hours from teterboro to l.a. craig: 10% of the 1% can truly justify the cost. it's mostly business owners and ceos. they can to have $30 million to $40 million or more at an annual income of $5 million. olivia: private jet business tends to track the s&p.

stewart says business is great. craig: is the golden age of private aviation. olivia: if the golden age of private aviation. matt: i want to be in the 10% of the 1%. olivia: who doesn't? xo jet is very interesting because it is actually a different business model than netjets and flex jet. the -- instead of buying into a fractional ownership, it is all a cart like the number of private jets. -- the uber of private jets. matt: are they all pretty accommodating still? olivia: you can ask for pretty much whatever you want. matt: you can -- we should do this at some point. coming up one of the stress

that the world faces in the next decade, could the end of the eurozone becoming? ♪

matt: welcome to "market makers." i'm matt miller. olivia: and i'm olivia sterns. matt: we are about two hours in the trading day. scarlet fu, the santiago winner for us. scarlet: on the dow industrials inc. pfizer. it is trading at 11 year high. jeffries traded it to the franchise picks list. it is based on a better-than-expected launch of its breast cancer drug, and also adding the global part of the

business, existing treatments receiving more durable growth than other libels. -- libels. an interesting thing here, it intends to separate part of its business from the rest. a bigger boost for pfizer over the longer term. keep an i on pfizer, 2.5%. also, another note from raymond james. olivia has been following this one. alzheimer's drug treatment i don't know how to say the name of it. you want to buy generously on that drug because -- you want to buy jen worth -- genworth's option on it. assuming the biogen idec

treatment is successful, this could be a way to get in on that. matt: everyone is hoping for the best. scarlet thank you. olivia: sometimes it seems the world is falling apart. we have real or geopolitical crises in ukraine, pakistan, and elsewhere. it is useful to take a look at the big picture over the next decade. i'm pleased to be joined by george friedman, joining us from his office in austin. his new book is flashpoints, the emerging crisis in europe. george, let's get right to it. you said the biggest risk in the next decade is the disintegration of russia. how do we get there you go -- how do we get there? george: the russian federation

fell apart primarily because of economic failure and one of the major failures was the drop in energy price. right now, we are looking at a major financial problems inside russia a russian failure in ukraine. both of these will overtime delegitimize the regime and as the regime weakens and has less money to send to the provinces and cities, these cities will drift away into their own formulations. what we are looking at here is a very weak country punching above his weight having had a history of disintegration already from the soviet union. a lot of secessionist pieces there. the country could fall apart. matt: why would you call it a failure in ukraine? hasn't vladimir putin got what he wanted in terms of the crimean peninsula? and i think is approval rating is something about 80% right now. it seems that aside from the low

price of oil he's holding pretty strong. george: before the events in key of, the russians controlled all of ukraine through the government. they now hold onto crimea, where they've always had by treaty 25,000 troops in a small sliver of the east. the idea that they didn't take a beating in ukraine is not the way the russians look at it and it's not the way we should look at it. matt: understood. george: as to prudence ratings, george w. bush had 91% popularity ratings in 1991 and lost the 1992 election. matt: let me ask about your decade forecast. it's a fascinating read. one of the things i found interesting is that you almost seen to call the failure in europe already. do you think it's that close? is already callable?

george: unemployment increase is 26%. in southern italy is 22%. in spain, 24%. these are the unemployment rates the u.s. experienced during the great depression. southern europe is in catastrophe. eastern europe is facing the russians without any support from the rest. feeling countries really doing well are germany and austria. they're unemployed with rates -- their unemployment rates are 5% and the germans are very vulnerable. olivia: why are they very vulnerable? with the chief euro, -- the chief euro, things are looking pretty good. george: in the short run, the chief euro -- cheap euro matters. but germany is exporting to europe in a massive disarray. it is not possible for germany

to maintain these levels of exports. especially with the united states, south korea, japan and so on. the way it will go is down and as a goes down, employment in germany will rise to stop right now, the big variable -- will rise. right now, the big variable in europe is unemployment. matt: i'm assuming after this crisis shakes out, you are saying poland is back on top. or is on top for the first time in recent memory. george: if you look at polish economic performance in the last 10 years, it's been for -- fairly phenomenal. by fragmenting russia, poland by default becomes a major nation. but also, poland has a strategic relationship with the u.s. that is getting deeper and deeper. we know from a come tree -- a country like south korea that in 1950 was a country of rice farmers and by 2000 was one of

the major industrial powers in the world what it means to have his rigid relationship with the world's leading power. : is now in that position and will exploit it -- to have a relationship with the world's leading power. poland is now in that position and will exploit it. olivia: we had a guest couple of weeks go that was making the point that everyone in the world to mrs. any expression of a security -- that dismisses any expression of a security threat from russia is hyperbole. we forget that from their eyes nato has been on a very aggressive marched eastward. isn't there something to that narrative? george: absolutely, and ukraine is fundamental to russian national security and the west has shown no secure -- no concern. ukraine is fundamentally important to them and they have lost control of the situation. they did not get an uprising in the east. when they have a fundamental

national interest, like russia has, and you are not able to assert the power to create the environment that you want, this is where governments in the long run run into trouble. olivia: you could say that they are getting a lot of what they want, it seems. it appears that vladimir putin has gotten more of what he wanted, including more territory. george: in the end, kiev is now a pro-western government. the crimea is an isolated area has a lot of russian troops in it and has always been russian in a way, but is not decisive. the russian military performance in eastern ukraine has been pathetic. they have not been able to defeat even poorly trained poorly armed ukrainian troops and breakout. when you take a look at the russian position, minced one minsk two, all of these

things. russia is now battling for a sliver of influence in eastern ukraine and has the united states all over it. it's not a great position for russia. matt: this is why we have the foremost expert on, george friedman. thank you so much. we will take a quick break and bring him back here and tell you what he is not worried about like the iranian nuclear confrontation. we will also give you his views on china. stay with us or more. ♪ -- for more ♪

olivia: welcome back. george friedman is back with us, the chairman and founder of stratford, a global risk forecasting firm. we have been talking about his forecasting for the next 10 years. we have to talk about iran. why are you not concerned about a nuclear iran?

george miller we heard about a nuclear iran since 2000 -- george: we heard about a nuclear iran since 2005. every year they were going to get it into years. they have not gotten it yet because building a nuclear weapon is much will complicated than enriching uranium to stop you got to miniaturize it. you got to ruggedized it. you got to launch into a vacuum reenter the atmosphere, and that it has to explode. this is really complicated. the most porton -- the most important thing to bear in mind is that they really believed what they were saying, they would have attacked before. this is -- that they would be able to base their fighters much closer to iran, and there are much -- many countries that would cooperate with them that are worried about iran. they would use special forces to take it out. the israelis would not let this

go on if they believe they really had a nuclear weapon. netanyahu statements and actions go completely counter to each other. olivia: the fighters into chris -- in tikrit are taking their cues from revolutionary forces. is iran are ally in iraq? george: there are no allies. we have common interests. we don't want diet -- want isis to dominate and they don't, but for different reasons. the fact of the matter is, the u.s. is not going to send another 130,000 troops to iraq for two reasons. one, no one would support it. and secondly the troops failed. you would have to have a much larger force. if isis is to be defeated, i've got to be by those countries in the region with an interest, and that is iran. matt: this conversation is fascinating, but i want to get to china quickly.

you said the age of fast growth low-wage china is over now. how do you see that playing out in asia? you do not see china as a military power or an economic power going forward. george: it is certainly major economic power. japan remains the third largest economy in the world. i don't understand why japan is always the list. china will be a major power. but it has reached a new normal of more sustainable growth rates , and as its rate -- is wages have risen as has inflation, it has become less competitive in the world. right now, mexican labor is cheaper than chinese labor. and chinese factories are relocating to mexico and other countries because of that. it's not to say that china is not a major economic power, it is. it will not grow the way it has for the past 30 years.

matt: fascinating research here. i highly recommend that you reach out and get it. is this exclusive to us? olivia: you have to pay for it. you will be happy to know that my father, bill stearns does pay for it. all of your work. you want to pick up his book. matt: the real estate industry is still struggling to gain traction. for the second month in a row, home sales fell short of the 5 million rate. two issues, and that is, slightly higher prices on inventory, and the lack thereof. the national association of realtors said the median house price rose 7.5% from 12 months ago. and revenge he has rejected an activist investor on his music business.

vivendi says it will explore another proposal to raise its dividend. and lines gate, the young adult franchise, the weekend winner in the box office. the divergent series "insurgent," was in first place. cinderella was in second almost $35 million. it has made more than $120 million in two weeks. have you seen cinderella? olivia: not yet. would you like to go? matt: thank you for the invitation. stay with us. ♪

matt: the ncaa tournament is down to week 16, instant ohio state lost i won't be watching anymore. olivia: i was never watching. matt: i have to tell you the truth i really wasn't either. i have been watching the bracket challenge because i'm involved so i'm interested, but also stephanie ruhle and a couple of other people got together $360,000 worth of donations for charity. it's a $10,000 a shot deal, and a bunch of big ceos and hedge fund managers were involved. olivia, and a huge shout out to stephanie, who would be back soon. -- two will be back soon. the current leader is john donohoe and behind him, jimmy duncan and then bruce richards. matt: maybe these guys are

basketball fans. maybe they filled out their brackets because they like the jersey colors of the teams. i just sort of randomly filled out my bracket, and i was winning on the first day. after the first day of play i was ahead of john donahoe. now i have dropped back to 41st play. olivia: and where am i? matt: about 25th. olivia: that is not that bad. matt: i chose kentucky because i grew up in an era when kentucky was hot. tom keene is coming in third place, right? olivia: tom dark or skiing coming up in the -- tom dark horse keene coming up in the brackets. i had smu in the final four and the obviously lost already to

ucla. nobody's bracket is intact at this point. mescaline and i had gonzaga. olivia: and -- matt: and i had gonzaga. olivia: and you cannot change it at this point. : no, you can't. it's been a pleasure to be here. ♪

scarlett: it is 56 past the hour and that means bloomberg

television's taking a snapshot. the nasdaq bounced between gains and losses not making much progress at the moment of pushing past the record close. we will keep an eye on the index as the trading day continues. joining me is jim strober, derivatives analyst. the bigs is at 13.36. that does not show a lot of fear about swings. jim: absolutely. a lot of opposing forces out there. as you said, the fix, and the end the volatility of the vexed also at the -- of the vix also at the bottom of its range. and going back to 1990, in the

lungs proceeding the beginning -- in the six months preceding the beginning of this move, this spread between the fix and currency volatilities is as wide as it has ever been. we still see the volatility, the net of all of that is still a lack of clarity. scarlet: the dollar is weak right now. instead of -- and what the fed did instead is a game changer for trade. what you think it means? jim: in june of last summer when across asset classes everything was highly correlated, implied volatility with his work we love. we just on how that degree of correlation. even though equities are up here and europe is lower, the cross action is not there, which makes it more at risk.

scarlet: we got existing home sales today and there will be a lot of housing data later in the week. your trade for us today is on homebuilders. tell us what that is. jim: homebuilders themselves have worked. we wanted to be very stock specific. we wanted to own katie holmes and beginning of this spring trading season. -- kb home's at the beginning of the spring trading season. overall, it's been a steady beginning of the spring sale season. it's not fantastic because there is weakness in different parts of the country, and also the weather as well. what we want to do now is robust position into momentum trade. we want to use the us home construction etf to do that. implied volatility is relatively low and we want to look out to july and by 30 -- buy 30 strike

calls. there's not a lot of implied volatility. the issue we think here is that there still a lot of steadiness behind home sales, but we don't want the single stock rick -- risk. we want to play the more as a momentum trade. scarlet: and very quickly, i tbg ? correct --you are shifting from value to momentum. jim: exactly. scarlett thank you. "money clip" is next. ♪ \

him: -- pimm: welcome to "money clip." i'm pimm fox and here's the rundown. in politics, ted cruz will now be running for president but can he raise the money and can he win? around the world, singapore mourns its founding father lee k wan yeuw. and in motors, rolls-royce once the world to forget about the