you should be in the stock market. biking to work is all the rage. good morning everyone. this is "bloomberg surveillance." we are from new york this morning. i am tom keene. joining me, olivia sterns and brendan greeley. top headlines, here is olivia. olivia: angela merkel has a message for the prime minister of greece. you need to follow the terms of the bailout agreement. george sir says is a lose lose game. he says the possibility that greece leaves the eurozone is a real threat.

>> if it pushes greece out of the euro it would hurt itself. olivia: chuka umunna --chuka umunna --soros says --. an american educated former world bank official. the obama administration's use him as an improvement over his predecessor. gone he wants the u.s. to slow down its military withdrawal. israel was spying on the united states talks with iran over the country's nuclear deal. the wall street journal says the white house was not that upset

because both countries regularly spy on each other. israel shared the information with u.s. lawmakers in an attempt to sink any deal. john kerry returns to switzerland to continue talks. brendan: deutsche bank shrinking trading businesses to groove -- to boost profits. higher capital requirements have cut into the profits and wait on the inc.'s stock prices. the nfl making moves aimed that those who do not go to the stadium to watch games. huge news, all games will be televised in local markets even if they do not sell out. a pro football game will be broadcast on the internet. finally, angeline jet -- angelina jolie out with an announcement.

she spoke about having a double mastectomy. she has taken the next step. she has had her ovaries and fallopian tubes removed. she writes it was not easy to make those decisions, but it is possible to take control of any health issue. tom: a huge deal. i don't have strong knowledge or opinion, but it bears the closest discussion. brendan: the importance of preventative care and early testing that changes tragedy and expense and the other thing is changing the role of a doctor with all of the tests and markers we have. a lot of what you do is counsel people on how to work through these decisions. tom: had a you take this? how do you adapt to a superstar like this visible on the issue. olivia: i think it is wonderful

she is using visibility to shed light on an issue women think is taboo. brendan, your wife is in this field. brendan: one thing that is changing men are moving out of the field and women are moving in. you want someone who can walk you through these issues whom you can trust. tom: angelina jolie. let me do a data check. the euro, i do not believe we got there. a better german data. nymex crude, look where we are. crisis over. those aches -- though they -- the vuxix. let's get one key -- wonky.

this is a bloomberg function. this is a little hard to see. the blue line is way up through the zero bound. a tailor role is one measurement by john taylor codified in economics of what the federal reserve and central banks should do. brendan: you cannot really see this well. i would argue that you have put this green box in the right place. the taylor rule is saying rates should go up now. it had it way down. here we are. we have the actual rate parked at the zero bound. this shows the power of politics. politics say you cannot go below

zero. tom: you argue the message. 2003 suggesting this is one of the flaws. olivia's: why would janet yellen do anything that ties her hands? brendan: can we go back and lower rates? was the speech yesterday this is tom at the speech, like a 10-year-old girl at an ariana grande concert. tom: i begged him to come on the show. he said no. i am so tired. the spinach was very good. here is the plug-in of the taylor rule. this is beyond squishy.

lots of add-ins. you need to speak to an expert. they hung on every word yesterday. today, global wall street must recalibrate. they have to figure out what the reactions will be. feist chairman fisher mentioned at least three times, we need to go to --. -- is the head of equity strategy at bank of america. that barely describes her abilities. when you look at the squishy nests of the taylor rule, why should we listen to stanley fischer? >> janet yellen has been transparent about what she is looking for, wage inflation, strength in the global economy. relying on one arbitrary measure might not be --

tom: do you link interest rates into what stanley fischer spoke about yesterday? savita: we are off the grid and how odd things are now. i do not think the fed hiking will be bad for the stock market. it will be good. it suggests the trillions of dollars of said has spent on healing the economy has actually worked and we are in the all clear zone where the fed can start to hike rates. olivia: equities do rise. savita: they do. we looked at what do markets do. we found that you get multiple expansion in some cases during fed hiking cycles, which no one acknowledges. we could have multiples continue

to expand, even if the fed is hiking. the markets r.o.k. and then it rolls over. we have another year or so of strong market returns ahead of us before we see things turn south. brendan: what does the dollar do when the rates went up? savita: it generally goes up. this is where i think the playbooks don't work that well. there is a knee-jerk reaction to equities when the fed tightens. don't lie multinationals because dollar strength is going to hurt the big exporters. it doesn't actually work. here, it is important to look at what happens in past dollar cycles. multinationals can do well in those environments.

olivia: you say bearish sentiment is that extreme. savita: here's one barometer that we track. we look at southside strategists and what they are recommendeding. they are recommending you only put half your money into stocks. i find that low. tom: the pros are 5% or 6% in stocks. savita: the benchmark is closer to 60 percent, 65%. wall street has been much more bullish on stocks. cash balances are high, which is

a bullish sign for risk assets. olivia: what do you think -- greece could go down the drain. do you agree? please tweet us. we are streaming on your tablet, phone, and bloomberg.com. good morning. ♪

tom: futures up five. top headlines. brendan: angela merkel has a message for greek prime minister.

we want your country in the eurozone, but greece needs to follow the terms of the bailout agreement. president of afghanistan may face tough questions when he meets with president obama. the obama administration wants him to take tougher steps against corruption in the drug trade. crossing the bloomberg terminal, two terms at the helm would be enough. david cameron's as he wills are of a full five-year term, but he will not seek a third term. convict sentenced to death in utah could face firing squads. european companies opposing capital punishment will not sell the drug to u.s. prisons.

the new york times says facebook has been holding talks. the goal is to speed up delivery of news content. it did not look like the third day of spring in chicago. some parts of the city got half a foot is no. hundreds of flights were canceled. those are your top headlines. olivia: still a come, new york times, should you stay in the stock market. we will ask bank of america's equity strategist. we see why so many homeowners are still underwater with the chief economist of zillow. a man on a mission. the leader is meeting with president obama at the white house. the top priority to convince obama to slow down the pace of withdrawing u.s. troops.

>> that decision will be made by president obama. what we have emphasized that we are a strategic partner. we are bound by common interests and we will act together to ensure the safety of the united date in this idea of afghanistan. olivia: let's bring in peter cook. peter, you used to work for him at his think tank, but for those less familiar with him, who is president obama dealing with? peter: he has been on the job for six months he is someone who understands the united states, used to live here lived in maryland. he understands politics. he understands the strains on president obama and the possibility the resident might walk back his decision to reduce

u.s. troops or alter the number that the u.s. has in afghanistan between now and the end of his term. this is a big moment for the president if he can convince our president to make some flexibility. he has thanked the united states for the sacrifices made. olivia: what is president obama want in return? peter: he has been pushing johnny to crack down on corruption in that country, to do more and try to bolster the security of the country. there are certain things the

president wants to check off of his own list. it would be an interesting discussion to be a fly on the wall in that room. a different discussion than president obama would have had with president karzai. olivia: what is the mood in washington? what is the appetite for keeping u.s. troops in the region? is there a rethinking going on in washington about the value of keeping american forces in afghanistan? peter: the iraq experience has had an impact on members of congress on the fence or inclined to bring troops home. some want all troops out of afghanistan and some want to bolster the number of troops in afghanistan.

the fence-sitters believe it would make some sense to leave a bigger number during the fighting season that is about to kick off and do everything possible to help their president as he begins his efforts as president. his appearance in front of a joint session of congress will make a big impact, but because of iraq, lawmakers are more inclined to keep u.s. troops in afghanistan than they were a few months ago. brendan: there is an economic relationship with afghanistan. the world bank is worried about what happens to afghanistan. is that part of the talks? peter: it is. the u.s. bolstering the armed forces is about a $4 billion a year bill right now. there is a lot in terms of economic development, what can be done to foster the economy.

there will be a new fund kicked off by the united states. the goal is to tie it to reforms that might help unleash the afghanistan economy. it is a far cry from what afghanistan leaders are hoping to see, but it is an improvement over where it has been. olivia: thank you. peter cook joining us from d.c. tom: robert joins us. we will speak to the professor about leadership and the conundrum, the yes men or yes women. boy, can they get ceo's into trouble. stay with us. ♪

tom: good morning, everyone. let's get to a morning must read. brendan: tom cannot let go of ariana grande. this was written to a mailing list this morning. europe's machine from hell. it will not break. if everyone else is to behave more like germany, then germany must behave a bit less like germany. germany is not prepared to do that.

what i thought timothy was good at pointing out, this thing we all except it comes up against culture, which is that germany is not going to change. what is to be done? is it a machine from hell? savita: it is messy and will create opportunities for investors. one thing everyone is focused on is the dollar versus the euro. the fed is not doing anything and ecb is easing as fast as they can. one thing i noticed everybody shorts europe and china exposed stocks to expose negative bets on europe and overseas issues. they never go along on u.s.

stocks to express a positive that. olivia: we had george friedman on for the geopolitical risk. he said he thinks this is going to hurt germany in the long term. he thinks: is going to be the new economic engine and germany's days, the growth of europe is numbered. tom: we will continue this discussion in the next hour. alan on a massive strong dollar call. stay with us. ♪

tom: good morning. a headline across bloomberg. tone between germany and greece improving. it is improving. brendan: what does that mean? i did not see any deals inked. tom: here are your top headlines. olivia: angela merkel gave alexis a red carpet reception. she told the leader he needs to set -- needs to follow the path

set out by the leaders. merkel has insisted they stick to the terms of the agreement. >> neither are the greece lazy nor the germans responsible for the drawbacks in greece. we have to work to break these stereotypes on both sides. olivia: who breaks that news across the wire that the tone is improving? both sides has something to ask for when president obama meets with the president of afghanistan. the obama administration sees him as an improvement over his prentice is her. he wants the u.s. to slow down the pace of military withdrawals from afghanistan.

the white house is disappointed with his efforts to and government corruption and drug trafficking. a preliminary deadline of march 31 to come up with an agreement. there is report israel was spying on the talks. the white house was not that upset about this lying, but the administration was unhappy that israel shared the information with lawmakers to and the deal. brendan: robert durst link to a four decades old disappearance of a college student. she disappeared in 1970 one. he appeared yesterday at a quarter. he is being held without bail. a symbol of the national pastime and now louisville slugger will be owned by a company in

finland. they are buying the that maker for $70 million in cash. they also own wilson. 60% of baseball players use louisville slugger bats. $240 million in private sector grants. they designed a battery-powered page turn to help people who are paralyzed or have arthritis. tom: what is it about the greece officials. there are informal diplomatic meetings. what are they thinking? brendan: it is hard to explain how angry germans are at --.

he is like the devil. tom: when you go to dad for the check, you wear a nice stress. olivia: i do not take money from my father. if i asked for it, i would dress up. tom: there we go with our analysis. brendan: i have been here for six months and i do not know whether to tie or not to tie. olivia: with the germans be less mad if they perceived him as less respectful. brendan: i think they would be less mad if he had not brought up for debt. tom: this is serious. this is the world we live in. that headline came across yesterday and i was thunderstruck. he said that on stage.

olivia: he has been repeating it. says robert shiller -- tom: robert shiller. the stock market is of good value the ender of all bull markets, the great rotation has not happened. that is when everyone goes sell bonds, buy stocks. it has not happened. savita: rates have not meaningfully risen. tom: rates up, prices down. savita: it is a tough call.

we are at a point where the average individual investor is over allocated to fixing income and under alkylated to equities. money is flowing freely and violently into bonds that it has equities. we have seen a nascent bid on stocks. what investors are buying in the stock markets are the most bond like stocks they can find. anything with the yield, whereas the average stock tech companies or industrials, have not cut a big -- brendan: is it possible to describe these as normal times. the rotation went into really risky debt. savita: if that is the case there is more money likely to flow out of risky debt poised to

not do well once we start to see a move-in rate into at these, which are better. our call on stocks is the idea that where else can you get growing income? olivia: they are assuming we are at the front end of a rate hike cycle. that is the place to be. savita: we should wait until they have times. you do not want to be there along the way. tom: your quantitative analysis, the call is dividend growth and share buybacks will and. you are suggesting it will not end? savita: share buybacks are starting to and should and. the market has re-rated meaningfully. it does not look as cheap as it did a couple of years ago. the companies that were buying back stock that depressed valuation was smart area the

thing that is surprising is that the payout ratio for the s&p the amount of earnings companies are paying at the dividend is almost a century low. tom: can we get a savita: and schiller hour? brendan: we will discuss the details of that during a break. coming up, it is officially's ring. as the temperatures rise, so will the number of high was. we are talking about the booming bike-sharing business. that is up next. this is "bloomberg surveillance." tom:, on. every tab would hit me. i would be a target.

it would be like -- kill that guy. terrible. ♪

tom: good morning, everybody. let's go to a single best chart.

brendan: let's look at a picture. that is the eiffel tower. if you can find it, officials are calling for measures to fight air pollution. the bike sharing program is free on sundays. it is the subject of today's single best chart. this is the number of cities that are offering a bike sharing program. it is such a beautiful, easy chart to interpret. this shows growth. savita: it does. i wonder what the overlay of pedestrian -- bicycle-related accidents would look like. brendan: this is a real problem. everyone believes it is a good

idea but it is easier to set up a bike sharing program than to change the infrastructure of a ditty. tom: the one in london is way better run than the one in new york. olivia: london is much more bike friendly. we have bike lanes, but i feel way safer. paris is perfect. tom: you do not look right, look left? olivia: you approach the zebra crossing. you have to stop. i look right, then left. brendan: i look both ways. i have given up on my ability to figure out what is right and what is left. i look both ways.

in london, i did a piece on the folding bike and there is a hierarchy of london bike riders. olivia: if you ever commute to work from west london into the city, you see a hierarchy of guys on the fast bikes and then the heavy bikes, it is a wonderful thing for the city and reducing congestion. london also has a congestion surcharge. brendan: let's pull up one more chart. we have been talking about the u.s. europe, here is chart number two. that is where the growth is. china. the biggest place, 100,000 bikes in china. if you compare china in terms of olivia: i think it needs a

population adjustment. tom: and wealth adjustment. brendan: we are talking about a basic consumer good. we are talking about the installation of bike sharing programs. tom: do you feel safe riding a bike in manhattan? olivia: no, i do not. brendan: i commuted on the city bike. i commuted carefully. i only used crosstown street designated as bike lanes. tom: well done. let's go to top photos. olivia: king richard the third. this is the actual procession of his body, and dug up in a car park a few years ago. this is the second burial. more people came out to attend this. brendan: and one of the most

reviled kings and the -- how sometimes you have to rewrite history. brendan: i am looking at wikipedia on your terminal. tom: kenneth branagh beat him up in a movie. olivia: this aircraft carrier making a visit to a harbor. our final picture, what do you think that is? tom: london.

olivia: it is an unexploded german bomb. tom: france, another airplane crash. it crashed in france. this is just out right now. we are going to break and come back with more on the crash. we will have much more on this. this is "bloomberg surveillance." ♪

breaking news. an airplane crash south of france. this is a lufthansa. it is a low-cost carrier based out of germany heading to barcelona. there were 142 passengers on board plus two pilots and for cabin crew. french police have confirmed the crash. tom: brendan, jump in here with

what you have learned. northeast of marseille. brendan: dusseldorf is a little further up there. this is one of the lower cost carriers. it is on an airbus a320. india just ordered about 400 of them. last year, a chinese company ordered 100 of them. there are about 4000 of them in the air. olivia: it does have a terrific safety record. i believe lufthansa owns german wings. that is why we are seeing shares falling in german pn -- falling in european shares right now. it has crashed in digne. tom: we will have more on this.

olivia: underwater homeowners sinking deeper into debt. if you look at prices, they are recovering. the lower end of the market is a valerie -- is a very different story. stan humphries -- falling homeownership. what is your overall read on the housing market? stan: it was better than the january numbers. we are expecting new home sales

to be down slightly. we're seeing a slight upward trend in interest rates. existing home sales are doing about as well as we can it back. house and formation rates are starting to recover. we still have millenials delaying marriage and kids. olivia: what are rising rates going to do to housing recovery? stan: i am optimistic. i think when rates rise, it should because you are starting to's the income rise. i am concerned most buyers are looking at these home prices rue a distorted lens which lead them to bid up the price of housing. if you look at southern california, those markets look affordable because of low rate.

olivia: if home prices rise, raise will come down a little bit? stan: you will see the heated market slowdown to more reasonable rates. brendan: we looked at data from the department of housing and urban development. we assumed homes were getting smaller, but that is something you find on the culture section. people are building larger houses. stan: it is more than an 80 year trend. we saw a one to two-year decline in that, but after that, it went back to its increased, where people are wanting bigger and bigger homes. that is colts rolled. it has to do with the privatization of leisure time.

families spend their time in their homes and they want media centers and larger living rooms, great rooms. they spend their time in their homes now. savita: how about student debt? the net worth is lower because they are sitting on debt. is that playing a role? stan: it is finding some delay, but it is just that, a delayed. we find your salary is hiring you are in a better position to earn a home. it will end up being a wash area did people are getting more education because the job market has been bad. they will be making more money and that will yield higher household formation rates and more ownership in the future.

tom: we need to get back to our breaking news from france. a plane crash. let me show you the flight. this is from dusseldorf down to barcelona. the passes over here, northeast of marseille. it is south of provence. olivia: the plane had diverted trying to -- had diverted, disappeared off radar, and was lost around 7000 feet of. tom: much more on this as we learned more information. this is just breaking from france. we greatly appreciate this.

tom: much more to talk about. we will talk about the controversial call of a stronger u.s. dollar. robert kaplan from harvick -- from harvard business school. ♪ . .

>> this is "bloomberg surveillance." tom: good morning, everyone. neidichneidich"bloomberg surveillance"

from new york city. a plane down in france, breaking news within 20 minutes within a number of 140 some onboard. this is digne france, north of marseille. olivia: it crash in the northern part of the country near the city of digne. it was on a flight from barcelona to dusseldorf. authorities lost contact with the plane at about 6800 feet. it appears the plane was carrying 142 passengers with a crew of six people. german wing is a low-cost carrier owned by germany's flagship airline what times a. it is a short two med -- to medium plane.

german chancellor angela merkel has advice for greece's alexis's press. she did not -- alexis tsipras. she did not give indication that greece is getting the emergency paid it needs. george soros us is as the possibility greece leaves the eurozone is a real threat. george soros: europe also pushes theis out of the euro -- would h urt itself. francine: is in a 50/50 possibility? george soros: i would think so, yes. olivia: her interview with george soros coming up later on "bloomberg surveillance." the president of afghanistan is expecting tough questions. he is in a measure -- american

educated former world bank official. the obama administration sees him as an improvement over karzai. ghani wants the u.s. to slow down its military withdrawal. brendan: deutsche bank may cut back its interest rate and the prime hedge fund. in sports, the nfl is taking away one of the roadblocks to watching pro football at home. for next season, the league is suspending its blackout rule which means all games will be televised in the local market, even if the stadium is not sold out, and for the first time, a pro football game will be broadcast on the internet. finally. angelina jolie is up as mind with another personal announcement for stuff you might member two years ago the actors and director wrote about her decision for a double mastectomy.

she was at risk for ovarian cancer. now she is sega next up. she writes in today's "new york times" that doctors told her to see a surgeon, and she passed those five days in a haze working to stay calm and focus. she ended up having to have her ovaries and fallopian tubes removed. she said it was not easy to make that decision it but it is possible to take control of any health issue. tom: the president of friends that with a headline. what does president hollandee say? olivia: it is unlikely to be any survivors from the airbus german flight crash from barcelona to o the also dorf -- to dociledusseldorf. tom: to describe it again, for those of you on bloomberg radio it is simple -- from

dusseldorf it appeared the plane was moving off path west toward marseille. there it is. let's go to hunts nichols now in europe. please describe for us the relationship for this airline. hans: this is the german operation of lufthansa. i have flown it many times across europe. excellent safety record. lufthansa stock went down 3.1%, airbus' stock went down 3.1%. and also be personal tragedy to present all -- personal tragedy that president hollande has said. this does appear to be a

tragedy and potentially 150 lives have been lost. tom: in flying around europe, you can look out a window at any european flight and you can see two or three of these smaller airbus planes. brendan: that is true there has been tremendous growth prompted by ryan air in these lines. give us a sense, is this a bread-and-butter routes carrying german tourist? hans: it could be. also docile dorf -- dusseldorf has a lot of tourists, so is a popular tourist route, and as you are saying, it looks like the plane was close to capacity. olivia: i want to update with a few more headlines coming across to bloomberg terminal. france wall lawns, the president of france, is concerned that there were 148 people on board

this fight. he is going to speak to chancellor merkel. he says there may be other casualties from the crash presumably wherever the scene of the pregnant -- the wreckage is outside of digne. and again, francois hollande saying there unlikely to be any survivors from the crash. the flight departed barcelona at 9:55 a.m. again with 148 passengers on board. tom: we will continue to cover this story through the morning on bloomberg television and radio. hans nichols, thank you so much from berlin. we moved to the quiet central bank investment, be central bank of the world. ice fischer yesterday at the economic club of new york stanley fishermen it quite clear that we are moving from an altar

expansive to an extremely expensive society. robert kaplan is from harvard he maintained his calm when alan ruskin fell off his chair. what did you glean from the smoke signals we heard from stanley? robert: i would not say it wasn't patient. i would say he was just telling us that even when the fed goes policy is not going to be tight at all. policy will be highly a comment it is, and it should be agreeable for growth going forward. tom: how has this changed and adapted robert kaplan's world? the world of alan ruskin when you look at altra expansionary policy, what does that mean for business in america when there is money that is free? robert: the good news is the cycle is very well-balanced. we can have trend rates for a projected period of time, severe

is sustainability in this recovery, and that helps for planning and businesses and robert's world. tom: rubber come in your world money has been free. does i give you a degree of confidence? robert: just because the fed is starting this not mean this is going to be done very aggressively. i think they just need to get started. there still remains -- there is an enormous deleveraging going on the western world, and he said -- which is creating a headwear and for economic growth. the fed is very aware of that, so you know they start, i think was stanley fischer said will be very accommodating policy even know they started raising rates. olivia: alan janet yellen has officially lost her patients. does the strength -- her pati ence. does the strength of the dollar make her wait a little longer? alan: a lot of people are saying hey, we have a little hick up

here at our is the strong dollar is concerned, maybe the trend has turned. we have not even started the said rate hiking cycle. at least against the euro for the next five years, so the strong trend is here to stay. brendan: i heard both you and robert say the same thing, which is there will be tightening but there will be waiting and caution. are we learning how to communicate them is that what that is -- tight and see what happens? alan: yeah, i think push a little bit and see what happened. stanley fischer made a very prescient a mark in suggesting we will get hiccups, and the fed will have to react, so the path forward is not likely to be smooth. people look at these trends and say you will have some sort of smooth path, when markets always intervene. brendan: i am always amazed to learn what is not the right way.

you think it will be a science but it is not at all. alan: no it has become a big factor in over communicating. tom: alan ruskin, we will speak to alan ruston on the dollar and we will talk to robert kaplan about the surprises that come to a ceo. not a correction, but within the news coming out, olivia, the direction of this rain is from barcelona to düsseldorf. we want to make that clear. olivia: airbus eighta-320, a low-cost carrier of lufthansa. francois hollande saying the crash site will be difficult to accessible to we will continue to cover that story ended back with the latest after the break. "surveillance" back a moment. ♪

tom: good morning everyone. "bloomberg surveillance." i am tom keene. brendan greeley and olivia sterns with us get to a morning must-read. olivia: my morning must-read is from robert reich of the university of california. he is writing in the "huffington post" about why college is not for everybody.

professor robert kaplan of the harvard business school still upset with us. professor kaplan, what do you make of what the professor is saying? robert: well, all the data shows that college -- more education, college education is helpful in terms of the rest of your life will stop i think the biggest article he cited is these skills mismatch in the united states. in many cities, there are unemployed and they are skills that have not been employed, and he suggests that more kids go to two-year vocational colleges will stop he is trying to address that. tom: what is the why? what is it about america where we are embarrassed of -- olivia: embarrassed of two-year. 46% of recent college graduates were in jobs i did not even require a college degree. robert: yeah, the reason this is going up in the united states now is he over $1 trillion of

student debt. that is why it is a bigger issue. olivia: will we be charging less for college? no. i think this is an argument for vocational training printed ships, and two-year college degrees. robert: the local skills mismatch is and the $1 trillion of student debt has become a real economic issue. brendan: there is an argument about what college is america, one way is it is a finishing school, learn to say and do to have a certain kind of job, but i do not think any of us at the table are using the stuff we used in college, and i know for a fact i am not. olivia: i am! brendan: i have not at one point been able to quote goethe at this desk. robert: i do not think it is intended to get you ready for your first job. tom: the germans do this better, don't they? robert: there is no debate

there. they have a huge emphasis on higher education there, but the united states is still the best. people from around the world are coming to this country from every country in the world to get educated here. we are still the leader in the world in higher education. tom: i think the skills mismatch thing is a really important issue. we have more news here on the airbus crash. this is a difficult headline. olivia: it is, indeed, sky news assaying the german wing a-320 sent out an emergency signal before crashing the southeast of france. we will be right back. ♪

tom: good morning, everyone. "bloomberg surveillance." let's get to our top headlines right now. olivia: breaking news from france -- and airbus a320 has crashed in the southern part of the country near the city of digne. the plane was operated by the airline german wings, flying from barcelona to düsseldorf. authorities lost contact with the plane is 6800 feet. the plane was carrying 142 passengers and a crew of six.

the president of france says the crash site is difficult to access, and no survivors are expected. in german chancellor angela merkel has a message for greece from minister alexis tsipras -- we want your country in the eurozone, but greece needs to follow the terms of its bailout agreement. merkel did not give any sign that europe is able to give greece the emergency aid it needs to keep from going broke. also crossing the bloomberg terminal -- britain's prime minister said to terms of the helm would be enough. david cameron saying he will serve a full five-year term if he is reelected in may but will not take a third term. he took off for us -- he took office in 2010 leading a conservative liberal coalition. and during last week's parliament elections, benjamin netanyahu warned voting in droves against i.d. systems -- against accusations of racism in the country. he won reelection. a crash has killed dozens, at

least 37 people died after a bus swerved into oncoming traffic. at collision triggered a pileup with two more buses and a truck. 84 people were hurt overwhelming nearby hospitals in peru. facebook has an offer for media companies -- let us host your news conference and set of sending users to another site. the "new york times" says facebook has been holding conferences for months. butzzfeed and national geographic are looking to it. at 7:30 a.m. new york time, we focus on stanley fischer then we see why george soros thinks greece will go down the drain. and at 7:50 a.m., we look at dollar dynamics with alan ruskin of deutsche bank. brendan: the recess at starbucks no longer have to write the words "race together" on their coffee cups. malcolm xpressos and some of my

best friends are black coffes es. robert caps on reached deep into your bag of case studies -- how does an idea like this happen? robert: i know howard schultz well enough. he cares about this issue he cares about gridlock in washington, so his intentions are good. the issue is -- race is a difficult and complicated topic as there is. people are very -- even the most qualified people are very careful about entering into it. we are in a difficult period as it is with ferguson, so to suggest an action where people are not equipped to have a conversation and secondly to put it on your packaging or make it part of your commercial process i think they have been well served to focus on doing things regarding race in the community and doing away from the branding and commercial aspects of the product. brendan: it is easy to poke fun

of this and lord knows i've been poking fun at it, but it came out of something that was well-intentioned where they held a series of town halls within oakland, but one of the things unaddressed in the country was racial issues, saw the manager, you have a decision to make. you say do not put it on your packaging, which sounds like sound advice. how do you handle it -- if you do not make it part of your outside britain -- how you handle it inside the company? how do you talk about? robert: every company deals with us. you will get very well prepared. you train people. you create forums to have the discussions and itin a constructive way. all the processes that addresses, that is how you do it. tom: you have a course at harvard business school, i will say it is in the second year the third most important is your

fall term. it is called yes-men 302 and you talk about the corporate he throws, which is where somebody comes up with a good idea but it needs amendment or adjustment or somebody to say, "no," and that check and that balance is not there. that is what happened here, right? robert: yes. tom: a guy like schultz needed a "no" man. robert: you need to create an environment where people think like owners and if there is an idea, they raise it. starbucks must've had people who did this but for whatever reason, they still went forward with this idea. i am sure there had to be debate in starbucks about this. i would hope so. brendan: it is a little tone deaf in a sense that starbucks in the u.s. is associated, if not with race definitely with cost. it is very expensive coffee. so you are starting from a point where you are already a target. robert: it is a place where you

go to relax, you go to get a cup of coffee, you go on your way to work -- it is not a place where you want to stop and have a conversation about one of the most difficult and sensitive topics you to possibly discuss. brendan: starbucks also has an interesting business model because they talk of rubbing a third space, and other private nor completely public. it is a space where people gather as well, so they have in a way in obligation that walmart, for example, does not have. robert: they are going to get it out of their place of business and they are going to start doing something -- they have been doing something in the community to have this conversation. i think that is probably where it should have stayed. tom: robert kaplan on leadership and the challenges. in six minutes in a we will have a complete recap of the plane crash in france. olivia, you see new information. olivia: i am reading from a twitter account of a newspaper in france, and they say the flight that crash was in fact 24 years old. they also say this was the first

major plane crash in france and 15 years. again, francois hollande, the president of france, has confirmed that all 148 passengers are likely to be dead. the crash site difficult to access in the southeastern outs of friends. we will cover the story in bring you the latest after the break. ♪

just because i'm away from my desk doesn't mean i'm not working. comcast business understands that. their wifi isn't just fast near the router. it's fast in the break room. fast in the conference room. fast in tom's office. fast in other tom's office. fast in the foyer [pronounced foy-yer] or is it foyer [pronounced foy-yay]? fast in the hallway. i feel like i've been here before.

switch now and get the fastest wifi everywhere. comcast business. built for business. tom: good morning, everyone. "bloomberg surveillance." chairman fischer speaking yesterday. let's go to the bloomberg monitor. it is a little clear. help me out. it is a measurement, a mix of inflation, output, and price

dynamics against the zero lower bound. we never had this dispersion have we, this distance? brendan: this is the difference between me and tom, tom has put the green box here, where he says the taylor rule should have the rate going up come i would put the box here where the taylor rule had away below 0. politics a you cannot go below the 0 amount, but if we are going to the ironclad taylor rule, let's follow it where it leads us. tom: alan ruskin at deutsche bank, more than qualified, this is blurry on the screen, but this is a fabulous bloomberg function of the squishing us of the taylor rule. alan ruskin is also a plug-in for smart guys like you or smart guys like stan fischer. "surveillance alan: alan: yes, they are. we in the market are narrowing down as well. tom: this is the efficient unemployment rate.

what is deutsche bank calling that right now? alan: about 5.5, the last fed estimate before the latest one is about right and terms of where we normally expect inflation to accelerate. keep in mind a lot of special factors, and the special factors that exist right now, the international factors like the dollar like oil are going to play themselves out the next 12 months to 18 months or so, so they are important. tom: alan ruskin, taylor rules, we heard a clinic yesterday from stan fischer. let's get to top headlines with olivia sterns. olivia: breaking news from france -- a german airbus has crashed in the southern outs. french president francois hollande says there are unlikely to be any survivors. it was formed by german wings, a budget carrier owned by lufthansa. in crash near the city of digne france. that is about an hour north of marseilles for stop the airbus a320 is a single plane that

flies short to medium distances. the 320 is the world's best-selling single mile airplane. and greek prime minister alexis tsipras came away from his meeting with angela merkel into hannah. the german leader gave tsipras a red card but no money. merkel telling the greek leader he needs to follow the path set out by greece's creditors. he has been trying to come up to them alternative to the program to the bailout. tsipras saying neither side is to blame. tsipras: neither are the greeks lazy, and we have to break hard to break these terrible stereotypes on both sides. olivia: greece may submit its latest proposals later this week. creditors have to sign off on them before greece gets any more emergency cash for the bailout. and the president of afghanistan wants american troops to stay in his country longer. ashraf ghani is in washington

when he plans to meet with the white house. all troops are withdrawn by 2017, but ghani wnaants then there is long as possible. brendan: murder suspect robert durst is also links to a four-decade-old disappearance of a college student. litchfield disappeared in 2001. a symbol of a national pastime, now louisville slugger will be owned by company. amherst sports already owns another big american sporting is good brand, wilson. 50% of major leaguers use louisville slugger bats. and the white house did a science fair day. president obama used the opportunity to place 250 million dollars for science, technology, engineering, and math education. he also met with this group of

six-year-old girl scout from tulsa. they designed a battery-powered -- to help people with arthritis. they cannot up with the idea during a brainstorming session. when they asked the president what he came up with, he answered "health care," it is the anniversary of when the president signed the affordable health care act into law. those are your top headlines tom. tom: it is always interesting to do a data check when there is no data check. the news right now is churning, and that is headlines to everybody within global wall street tuesday futures up 4, the euro a dash the $1.10 this morning. we will speak to alan ruskin later in the hour about their claw from massive dollar strength. nine myths -- nymex crude down from 48 to $47.75. brent crude was a $55 on $254, now $56.99.

the yield, particularly the 1.90% 10-year yield really showed the interesting trends right now that we see across equities, bonds, currencies, commodities. olivia: good morning. this is "bloomberg surveillance." i am olivia sterns here with tom keene and brendan greeley. more on the breaking news of the lane cross. hans nichols joins us from berlin. the 40 give us the latest, i want to give us the latest -- before you give us the latest, i want to bring up a tweet from president francois hollande. this is a mourning, a tragedy. he does not excite any survivors from the 148 people on board that german airbus a320 plane that crashed in the southeastern outs of france. with that said hans, what is the latest? hans: the latest is out of the

spanish airport authority saying there are spanish and german nationals on that plane. they have not released to the identities of the spanish nationals. they do not say they do not know the authorities will stop it was flight 9525. moments ago, we had the ceo of leptons a, -- of lufthansa, the parent company of german wings, pledging to work with authorities to find out more. it seems like the most best mystic line is coming out of president francois hollande, all but assuming that 148 people have lost their lives. where he has dispatched his interior minister down to the region as you mentioned, it is in a southeast of france, gathering information, there was a local tv report from french television saying that wreckage was spotted on the ground. suspect that might be the crash site and where some investigators will be focusing in on their efforts, guys. brendan: hans, give us a sense of the business back round of what is happening here.

we are at the end of a 10-year period of expansion and low-cost carriers around europe. german carriers like lufthansa was fine to ryan air right? hans: leptons a -- lufthansa has doubled down, they want a long-distance german wings model. an ounce that over the summer sometime, june, july, so they clearly like this idea of a low-cost model. german wings have a very good record i have flown many times, but they are under pressure. all of the european carriers are under pressure from the low cost pressures on the outside ryan air, then the gulf state carriers are eating into not only their margins but some of their routes, and that is emirates, qatar, and others. those three big gulf state carriers are putting the squeeze on lufthansa. leptonsufthansa has had the most

difficult time. they have been on pressure after that, this is for the parent company, they have had labor issues, a series of strikes throw the year. their last one was last week. it is an issue of retirement age, how much they will be paying their pilot so this is clearly an airline that is -- it is not in trouble, in flux and is transitioning, and has some pressures from both above and below. olivia: i want to jump in here we have another headline breaking across the bloomberg terminal from the interior ministry in france, they are seeing debris has been located in the southeastern outs it in the country of this -- southeastern alps in the country. earlier i saw on the twitter feed, the airbus a320 was 44 years old and this is the first major plane crash in france in 15 years. brendan: hans, when we talk bloody business background of this, we are also looking at airbus it up. these planes, the a320's have

been made in toulouse and hamburg, so this will have an effect on the german economy where you are right now. hans: look airbus has basically been printing these airplanes. one of the most successful if not the most successful airline in its history. it has been a q2 says, very -- it has been a huge success, very popular. it has clearly been a moneymaker. most of the a320's start off in toulouse and and finish off and hamburg for so most of the jobs are left in hamburg but i want to double check all of that before i take that -- with a little bit of caveat. olivia: the a320 has had a terrific record. the weather was calm in the region near digne when the landed crash. brendan: there is tremendous competition right now, if you look to the german wings twitter feed cover ss please go to our website for more information. their competitor, ryan air, says flash sale on flights.

there is tremendous competition and growth right now. tom: very good. olivia: hans nichols, our chief international correspondent, thank you very much, joining us from berlin with the latest on this tragic plane cries, german wings flight from barcelona to düsseldorf. we will be right back. ♪

olivia: good morning. it is "bloomberg surveillance."

it is time to answer our toward a question of the day. we asked -- is george soros right? could greece "go down the drain"? for more, let's go out to our -- the anchor of "the pulse" in europe, francine lacqua. she spoke to george was a great to see you as always. please give us the highlights of your interview. francine: olivia, thank you so much. we spoke about greece, ukraine, and on griese was not mincing his words. he basically said there was a 50/50 chance for the country to leave the eurozone. he said this is a country that may "go down the drain. he says this is some a that has been festering for a while because greece has been mishandled from the start. george soros:'s greece performance has deteriorated so doing what they are doing, they are hurting themselves. and europe also if it pushes

greece out of the euro would hurt itself. francine quotefrancine: is it a 50/50 possibility? george soros: i would say so, yes. francine: he says there will be no primary surplus because greece is going down the drain but they continue going up indefinitely, and that is the real problem so if the two sides cannot agree, this just keeps lingering without any real resolution. olivia: george soros made a fortune shorting the pound where is he placing his big bet these days? francine: you know me, i tried to get it out of him. he talked a little but a lot currencies and the fed and says he thinks the fed will raise interest rates this year but he was very vocal about the strength of the dollar, and you know what, he said it is a great

market for hedge funds, but i am not a hedge fund manager anymore. tom: francine, within all of your reporting out of london how exposed are the european banks away from the major banks to what would happen in greece? francine: look, tom, we talk day in and day out about the esff about how the ecb has controls in place. they would be exposed because whatever happens in greece will put panic on the markets. when markets start panicking, it dries up that pipeline that you need to put the channel from one bank to another, so could be a disaster. tom: francine, i was talking yesterday about the likelihood of a european restructuring. that thinking comes out of your london. are we going to see that? when you talk to called a bar at london school of economics, is there any greater likelihood of restructuring? francine: when you talk to professors and economist's,s

they want restructuring. people on the ground will say restructuring will be so unpopular at a time and we are already voting very right wing are very left-wing, it may not be something that will be on the cards. olivia: all right, fran, we will leave it there. francine lacqua, to every much. you can catch her full interview with george soros online at bloomberg.com. in the meantime right now, please answer a reporter question of the day -- is george soros right? could greece "go down the drain"? please tweet us @bsurveillance. ♪

tom: good morning, everyone. "bloomberg surveillance" from new york. olivia: breaking news from france, airbus a320 has aggression the southeastern apps near the -- alps near the city of digne. the german carrier owned by lufthansa was flying from barcelona to düsseldorf. the plane was carrying 142 passengers and a crew of six equal. france president francois hollande says it is unlikely any survivors will be found. and german chancellor angela merkel has a message for greece's alexis tsipras. she says greece needs to follow the terms of its bailout

agreement. merkel did not given any sign that europe is able to give greece the emergency aid it needs to keep from going broke. police say there is no evidence to support allegations of a gang rape at the university of virginia. "rolling stone" magazine described the attack in graphic detail in an article published last year. that set up a national debate about sexual assault on campus. police say a there are discrepancies between what the magazine alleged and what they found. they also said the accuser is unwilling to quote rate. any takeover for a drugmaker means a huge payoff for its cheap. -- its chief. the deal will pay robert duggan more than 3.5 billion dollars. and china's economy is showing more signs of slowing down. a measure of china's manufacturing has fallen to its lowest level in 11 months. that suggests more stimulus may be needed to boost factory output. the government has said the central bank will take action is growth slows down and cut into

jobs or wages. and three structures hidden in argentine park may have been a hideout for nazis. researchers are studying images. whether that use these buildings is not known for sure. those are your top headlines. still to come on bloomberg television, 8:00 a.m. time, we see why investors are loving mcdonald's. at least this week. at 8:10 a.m., are we ready for hillary? at 8:20 a.m., we look at the dollar's impact on earnings. tom: and of course considering of the coverage of the crash and bloomberg radio. ruskin making the cover of the "ft." deutsche bank suggests a further move in dollar strength, a strong dollar policy that all will adjust to. alan ruskin's global head at strategy at georgia banks, and every american's life will change at $.90 per euro. i wanted to call and

congratulate you and doing what i do not see enough, which is going out a couple of years. when you go out a couple of years, how does your analysis change from the next six months ballet that we see? alan: in some ways, one coming more confident about the longer-term. i know that sounds slightly bizarre, but some of the trends, the policy divergent trends taking the strong dollar view are actually help with more confidence as you go through. it is tougher to tell the fed is going to tighten in june or september, but we know they will tighten multiple times owing forward. tom: i learned from michael rosenberg's classic book on currency forecasting that it is about one of the other -- money moving around or a relative interest rate started. which is it that gets you to a strong dollar? alan: i think it is both actually tom. interest rate is the key driver driving capital flows, and of course do not forget what has happened here. we have had negative rates in europe, which is unique and that is really driving substantial outflows from europe.

tom: is your policy janet yellen friendly? alan: i think it works with the idea that the fed can go slow, that inflation pressures will remain subdued partly because the dollar is strong. tom: a stronger dollar imports disinflation and deflation into the united states. brendan: exactly, but let's take a look at europe, alan. over the long term, we know that the longer euro is good for german exporters. is it also good for the tourist economies? alan: it should be. this is one of the perverse elements that germany was resistant to keeley. -- to qe. germany probably benefits more than anybody else. you have a going up against 10% of gdp -- stunning numbers really. brendan: this is germany's way of saying please do not throw us into the briar patch. "in the loopolivia: it is time to answer our twitter question of the day. is george soros right? could greece "go down the drain"? first -- you do not have to be

an investor guru to know where greece is heading. greece will sell. -- will fail. second -- you cannot come it will struggle if that is desired, let it go. these are answered as if he does come it will lubricate the drain and make it easier for others to follow. we are very privileged to have a divergence of opinion. we have been debating to what extent the ecb will be on the hook for the exit. professor caplan, you say not so, alan ruskin, you say we are going down the drain. robert: by the way, allen has convinced me. with that we have been debating off camera is the secondary effects of greece failing for european banks have reduced the directory exposure, but allen, you're seeing credit is spread -- tom:alan: 17 trillion euros of interest european capital flows that is hosed is greece effectively leaves and the market starts to think that other countries could leave. that is the big problem. if greece leaves, people say

women a minute, is it possible other countries leave? tom: let me direct you francisco mays clear greece is front and center. a lot of people disagree with him. do you agree this is a front and center issue? alan: this is a front and center issue. i do not agree with george soros' views that this is a 50/50 bed. hopefully the author a lot more in favor of greece staying in the euro, but if he is right then italian yields and spanish 10-year yields at 1.25% do not make a lot of sense. brendan: alan since syriza was elected, we have in hearing if the markets think other countries will leave the euro, but the other markets have not thought that. he spreads are not widening and portugal spain, and ireland. alan: yes, i think the market is on the right side, but it is difficult to take into account the low probability of a

massive event. it is difficult to effectively price that in. that is the problem the market is facing. olivia: all right, i want to recap the tragic breaking story we have coming forward about the plane crash, the german wings airbus a320 flight that crashed en route from barcelona to düsseldorf. i'm getting some tweets from the lufthansa account, german wings flight number 9525. this is a dog day -- this is a dark day for lufthansa. we have heard from french president france all along that there will be in fact any survivors. he spoke at a news conference on the crash. take a listen -- president hollande: it is a new tragedy. we are going over the tragedy. we need to go over all of the causes and tell the relevant authorities in the spanish as well as german, and the families of the victims. it is a sense of morning that we feel because it is a tragedy

that took place on our soil. olivia: we should point out that the french interior ministry a thing they have located some debris in the southeastern part of france in the mountains at an alternate of about 2000 meters. francois hollande has said the crash site will be difficult to access, but there are reports that emergency crews are headed there now. i do want to point out a few tweets i have seen from the account of a newspaper in france. they are saying this is the first major plane crash in france in 15 years. they are zynga specific airbus a320 was 24 years old. they are also saying this is the first crash of a low-cost air carrier in europe. tom: you go to the separation within society of the kind of airline. we see this of course in asia with korean air -- not korean air -- korean airline crashing in san francisco that level of airline is a really important issue. brendan: we also talk about how the a320 is a workhorse of these

fleets. the airbus is selling these planes because the fleets are growing. you have increased pressure from ryanair on europe ryanair of course famous for cutting standards, offering lower pay packages to its pilots, and that is one of the things that lufthansa is trying to adapt to. first it was not worried about ryanair at all, note is very worried about ryanair. tom: we wait to see what the experts say brendan: about it. i should say -- experts say about it. brendan: i just want to say this hat lufthansa has a sterling record. olivia: as far as the a320, it has a terrific safety record. tom: francois hollande saying -- i want to express to the families of victims of the air crash my solidarity. this is a mourning a tragedy. we say thank you to alan ruskin

of deutsche bank and robert kaplan of harvard business school for their perspective this morning. stay tuned worldwide to bloomberg radio and bloomberg television. we leave you with futures improving come up 6, dow futures up 53, and the beauty of manhattan ♪

betty: good morning. it is tuesday, march 24.

you are watching "in the loop." let's get to the top story. the airbus crash in france. it is unlikely anyone has survived. >> it is a new tragedy. we are going over the tragedy. we need to find out to tell of families of the victims. it is a sense of morning that we feel because it is a tragedy that took place on our soil. betty: the jetliner was flying from barcelona to tussle door. we will update you on the story as we get more details. in the meantime in europe, angela merkel says she holds greece can become a stable player in europe's economy.