emily: live from her three welcome to "bloomberg west. " today, retired neurosurgeon ben carson formally announced his candidacy. yes become a grassroots conservative favorite and is known for strong opposition to president obama. he spoke earlier today from detroit. ben carson: i will probably never be politically correct because i am not a politician and i do not want to be one. [applause]

because politicians do what is politically expedient. i want to do what is right. emily: also announcing today former hewlett-packard ceo carly fiorina. carly fiorina: i think i'm the best person for the job because i understand how the economy works the world, who is in it, and how the economy has works -- works. corrupt bureaucracy. emily: afghan security forces are suffering record casualties in the first clashes in the taliban. nato says the number killed and wounded so far this year is about 70% higher than last year. the performer raises questions about the ability told off tell

ban and the u.s. plans to further scale back its role there. bill gross says it is the beginning of the end for the market. it protects a super cycle for the stocks and bonds that will soon run out of steam. the forecast -- favorable for monitor policies. investors are not loving mcdonald's turnaround plan, which includes the leadership shuffle, cost cuts, and return to shareholders. promising to remove bureaucracy and listen to customers as the chain tries to reverse a sales slump. >> we can no longer afford to carry legacy structures, commitments, or attitudes. that is why i'm changing the structure. our new structure will be simpler and more concentrated around the reality of where the operating income comes from. emily: mcdonald's and should be

more restaurants to independent owner -- owners. job cuts are on the way. the company plans on eliminating more than 1700 jobs around the world, or about 3% of its workforce. dow has planned cost saving measures after agreeing to split off a big chunk of its chlorine business. the coming estimates it will save about 300 money dollars per year once it is done cutting jobs. to our lead. after leading cisco for two decades, john chambers is stepping down as ceo naming the cisco sales letter and chuck robbins as his replacement. he has worked there for 17 years. recently leading the global sales and partners team, which cisco says generates $42 billion in business. chambers and robbins shared their thoughts in a transition video released on the website this morning. take a listen to what robbins had to say about his plans going forward.

chuck: maybe a little tougher than what you did. john: shareholders will love that. emily: for more, cory johnson joins me from new york and john butler is with us from new jersey. john, i will start with you up it what you know about chuck robbins and how he will leave his company? john: we do not know a lot. for investors, he really was not front and center. my guess is he is a very good choice. i say that because cisco right now is trying to really push and make a renewed push into enterprises. i think having a salesman at the home is probably the right person for the job if that is your objective. emily: cory, put this into context for us. a guy like john chambers leading the company for two decades. what does the transition actually mean? cory: i do not know when the right time is to celebrate.

it has done well as a lot of stocks have. this john chambers came to run 20 years and one quarter ago, an emerging company in this emerging world of the internet. the internet has changed and technology is changed radically since then. all of cisco's competitors have fallen by the wayside at that time. if you think about who those competitors were the four horsemen of the nasdaq during the.com bubble, we have talked endlessly about cisco, wrote,, and that he throw in somebody else, maybe enron was one of those companies people like to talk to about -- a lot about. you look at wayne ascend somebody companies that try to be bit -- big companies. cisco owns that and keeps that. their technology evolved largely

through acquisitions were they made sure they were not being left out of anything happening in the world technology. as a result, cisco is still a big and strong and dominant company. one of the biggest and most important enterprise companies in the world. i think investors might knocked down chambers, but cisco was a relevant company then and more relevant today and none of their competitors have been able to pull that off. emily: and yet shares are lower than they were 10 years ago p or lie is that? why are investors so hard on cisco right now? john: they were a victim of their own success in many ways. the company did so well, you get so big it is apple's conundrum now. it gets tough to grow also ever larger base. i would add networks right now are undergoing a big transition from the hardware intensive design to the new software design networks. i'm sorry software defined

networks. it is more of a software decline going forward. the cisco is in the mists of that transition. they are doing well so far but in order to stay relevant, they need to stay ahead of that whole wave. i think it will be robin's biggest challenge going forward. emily: what should the first thing on his agenda be? what should be priority? cory: i think that is really important here. the way the networks work have changed a lot in the last couple of years. the virtualization of networks virtualization, at a different level. security matters so much more as networks are software defined, if you will. it is worth noting that the accounting the company has used to stay on top of technology has hurt the stock. what they have essentially done and i will oversimplify it, they issued a lot of shares to the

company that they acquire, and they have used free cash flow to buy back shares to lower the share count. the result has been not a lot of free cash flow found its way to the investors, ultimately. it has kept the company in a central position in the network, but at the cost of shareholder return. emily: what will you be watching for over the next weeks, months, years? what clues will you be looking at to see how chuck robbins leads the company? john: wes talks months -- let's talk a months and years. that is most important to investors. you look at a horizon of a year to two ears, my feeling is cisco needs to step up apples -- acquisitions. it's early success was based on being a great acquisition growth story. they remain so, but they are making smaller acquisitions recently.

i think they have got to move on to bigger acquisitions to grow and dominate this market again. particularly, as we make the transition we touched on a moment ago over to software. emily: john butler of bloomberg intelligence and cory johnson will be back with us later in this show. coming up come the world's savviest investors gather to share strategy. we sit down with some of the biggest names of the hour. ♪

emily: this is "bloomberg west." uber drivers their cars are confiscated. it is ruled that uber is a taxi service. cooper argued it is a platform rather than a transport company. a criminal complaint was filed against the company and please were urged to shut down in

december. it is taking the lawsuit and this latest decision seriously. goldman sachs is planning an expansion into the online lending business for individuals

and small businesses. according to a memo, the bank hired former discover financials who ran the division. the exact type of products goldman plans to offer is still under development. the 20th annual investment conference is underway in new york. the event today is bring together the world's is savviest investors to share insights and strategies. stephanie ruhle is standing by with the managing partner. take it away. stephanie: you just left two ideas. walgreens to start. do you think they are doing better, are they poised to be successful since the merger? >> i think it is a transformed company, like night and day. this company has a shareholder base completely turned over. a board that is refreshed. the board members have been weaving and new members have been coming on. direct and relevant experience. the old management team has turned over. one of the great entrepreneurs of all time is running the company today. stephanie: that sort of for the claim prove met for what they need to do, is that the right strategy?

>> i think there are both internal changes that need to be made and will be made, and are being made. there are costs coming out of the business. there is a lot of capital allocation decisions being made that are more efficient. but there is austro -- also is -- strategic decisions that need to be made. stephanie: are the store makeovers enough? barry: i think they will make a difference. there are plenty more thanks. -- things. the cost is out of control. this company stopped growing its store base in 2008 but continues to grow its base. there are billions of dollars of excess costs to come out of here. never really looked at the strategic position and come up with coherent strategies to address changes in health care. stephanie: you feel they are addressing everything and are on the right. barry: for sure. the company >> -- crushed it. i think it is not coincidental. stephanie: another name you

talked about today and we heard in the past, qualcomm. we know they are doing a buyback. is that enough for you? barry: no. that is the first step. we need to get it done quickly before other changes that made and the stock stops working. that is the first thing. there are a lot of similarities between walgreens and qualcomm. i could take the walgreens and just write qualcomm on top of it and would pretty much work. there are costs that need to come out. this company has a bloated cost structure. rmb has not been run efficiently or rigorously with a return on investment capital discipline. the company needs to change how management gets compensated. stephanie: how are they responding? it seems when you came out after qualcomm, the response was, thanks, we are already on it. i do not think that is what you're looking for?

barry: no. we are looking for substantial change. i do not think there was much they could say when we first came out, but i am confident they get it and they will make those changes. that they need to make. stephanie: management is open to reducing how much they get paid? barry: i believe so and i certainly hope so. they need to right now, they get paid on operating income and whole numbers. they do not get paid on a per-share basis to they do not get paid him return investment capital basis. [indiscernible] in the form of shared distributions. stephanie: could one make the argument that is just how you need to pay top talent? that is what people at that level expect to be paid. barry: if they perform.

stephanie: what needs to be done? do the businesses need to get separated? barry: i do not know yet. they need to check out whether it makes more sense to keep it together or derive more value separating them. the company trades at a market discount that is pretty meaningful. something is not right. stephanie: how did they respond when you basically said, your board is old, white men. barry: i did not say that. stephanie: i will say it. barry: we told them they need to turn on some of the longtime term members and they need to bring in a cost and shareholder perspective and people who have direct industry experience. stephanie: for you as an

activist, it sure sounds like walgreens is a lot more responsive and positive to work for? barry: we are well over a year into the situations. it took time for a lot of those changes to take place. stephanie: is it easier for you to work with bigger or smaller companies? barry: i ironically find the smaller countries are more responsive. you have board members who have reputations of their own and run their own companies. they do not want to be on the board of the company underperforming. they do not want to be put in that light. so we find they act pretty quickly when we show up. they do not fight us too much. stephanie: is berkshire too big for an activist? barry: i will leave it to somebody else. stephanie: carl icahn and larry. carl came out yesterday and said larry, -- a lot more for

companies than you ever did. what do you think? barry: did he say that question mark i'm not quite sure he said that. buybacks are good if the management is good and is creating value. but i thought he agreed with larry that is a company is just buying back stock and the management is not capable of generating value and investing the capital in a more attractive manner than buyback stock, then there is no point in buying back stock. stephanie: our traditional money managers just rubberstamping boards and saying, good enough? barry: i think it is evolving. i think activism is changing. that is a good thing. stephanie: thank you so much for joining us. emily, we ran out of time, but i really feel like barry was going to say, maybe more women on

those boards be a not sure, but i feel like he was going to say that but we ran out of time and what do you think? emily: you tried. thank you so much for that interview with barry. more after the break. ♪

emily: this is bloomberg west p i'm emily chang. executives are able to attend the funeral of dave goldberg. he died suddenly on friday after collapsing while exercising in mexico. he was just 47 years old or he was the husband of facebook coo sheryl samberg, also a disney board member. disney will announce its results at 8:00 a.m. eastern time on

tuesday. dave goldberg was one of the most genuine ceo's's i've ever met. a man of fierce intelligence, a doting father of two children, a loyal friend and colleague, and a dear friend of our show. his life was cut to short, but every day lived -- he lives fully. i want to welcome our special guest host. thank you for joining us today. are you ready for your hour of fame? dave goldberg joins us now with more in our monthly segment, the survey monthly shakedown. >> i took my first company public. we had $10 million in revenue. a lot of companies went public. they used public markets to

raise p are now all the bankers they tell you if they do not have a billion-dollar valuation, do not waste your time. i had a long background in online music heard for a long time, we were upstarts. for now, pandora in this case for online music is mainstream. when i was a kid, i build model rockets. a drone is way cooler than a model rocket. if i could just push a button and call it self driving car that is one of the ultimate futures we want to see. ♪ emily: tributes have been pouring in, painting the picture of a talented leader

compassionate, universally adored, a man who was kind and good, generous with his time as he was with me and us. in one of his last posts on facebook, he talked about how proud he was of his life leading the fight for gender equality at home and at work. he was in that fight as well. we will miss him. ♪

emily: this is "bloomberg west" where we focus on innovation technology, and the future of business. let's get a check of the bloomberg top headlines. federal agents investigating a shooting at an event outside dallas sunday night. incident took lace at a community center hosting a provocative contest for a profit mohammed cartoon. fatally shot by police and one officer was wounded. a video purportedly from al qaeda has named india's prime minister as its latest folk. the voice and the video said he

along with entities like the french satire newspaper charlie hebdo are waging a war against muslims. the prime minister faced criticism for his handling of muslims and christians since taking power last may. comcast profits beat estimates in the third quarter after abandoning plans to buy time warner cable just 10 days ago. the cable giant and a fitted from signing up for hundred thousand internet providers. comcast now has more internet subscribers than cable tv subscribers. staying with cable companies, they say they are feeling the pain. the base is down nearly 2.5% from a year ago. still, cablevision posted a quarterly revenue game of 2.5%. company targeted viewers dropping the service. a pay-tv provider will offer hbo's standalone service.

turning it over now to stephanie ruhle in new york at the investment conference. take it away. stephanie: thank you. you just left the stage. your top five investor. what is it specifically that you are betting on? >> yum is a fantastic company. kfc, taco bell, pizza hut. i am a piece of that guy. we will come back to that. but the business is currently under earning because yum moves to china, twice the size of mcdonald's and china, but there have been three successive food safety scandals in china, which have caused earnings to be at these levels. to put in contests, about a dollar per share of earnings today to when they get back to 2012 levels of revenue per unit, we think it will do over three

dollars of revenue and earnings in china. great business in china. a way of investing for the urbanization of the middle-class, and to grow from $6,500 units to maybe three over a decade plus. we have invested in a great business with a management team going through change being discounted by the market today because the markets are looking at today and not tomorrow. stephanie: how about the fact that all three black -- all three brands -- it is one of the problems plaguing mcdonald's. keith: yum's brands are in a different position than mcdonald's. it is appealing to millenial's. k of c, pizza hut, pizza, much better than hamburgers outside the u.s. five stores a day. three in china and he doesn't the rest of the world.

no days off. there is massive growth globally. america is ahead of the rest of the world and betting on this thing and fast food. it works. they moved quickly to embrace it. success in china has caused them to evolve in a different fitness model, because there is not a mature franchise market. different volatility and different risks, but still a fantastic as this. stephanie: are you and dan loeb on the same side and are talking? keith: i have a lot of respect for dan but we have not spoken that yum. also has a big position. figuring out how to implement corporate change.

often, companies will be able to take one step back and learn from it. taco bell has a motto. we think they can think mosque. do not become full attempt percent eps growth in the next decade when you could have 20%. stephanie: why should they be running for the border when you come knocking on the door? keith: we have done two active investments. we invested in commonwealth and an american realty capital partners. the chairman of equity commonwealth is repositioning the company. i think you get to buy a great collection of assets at a discount with a great ceo and chairman for free. why is it they have had this occur? there has not been a same level of governance and liquidity in the asset classes.

in order for it to grow, increase accountability were enhanced value. the onus is on real estate owners. if you do, it will be worth more in public form. if real estate does not have good governance, it does not need to be a good asset classes. then it should exist, it should raise capital and become a living organism. i think at one time, the whole market cap was the size at ge. an amazing asset classes has become a great look market asset classes and i think one of the reasons is government transparency, disclosure, and the line of interest.

stephanie: you are a carl icahn protege. he said he was mildly bearish on equities and majorly bearish on a clean markets. where does he stand? keith: i would defer to carl. i think equities are reasonably valued. we have had a good time because liquidity has driven -- interest rates are low, central banks globally are accommodating. if you put money in your wallet and it gets taken out every week and every month, that is what negative interest rates are, if money goes to your wallet and disappeared, you'll take that money and do different. people are buying equities. as long as the playbook is low rates and accommodating central banks, i think you will see equities begin to depreciate. the challenge will be when we start to see inflation, which we have not, or when we start to see asset bubbles ills which is the other risk of free and loose money.

i think equities are attractively priced for now. i agree that it does not justify credit. i would rather be a borrower than a lender. the best way to me is to invest in a great business that will borrow money and reinvest itself. owning an equity that will take advantage of cheap capital, invest to buy business -- as mrs., buy back stock, pay dividends come i think that is a great way to shore up credit. stephanie: you still think there is consolidation in the energy industry? keith: the challenge is having buyers and sellers meet. the majors have unlimited capital, but not the right assets a lot of the companies with right assets, shale assets do not have the right balance sheet. it makes sense, but i think you will always see a little less during times of price volatility. people with really good assets will not sell and people with bad assets want to sell and

people do not want to buy p or do i think it will take a lot longer. stephanie: thank you for joining us today. i will see you in just a few p or when i return, i will be sitting down with the one and only bill ackerman. stay with us. the 2015 conference here at the lincoln center. do not go anywhere. ♪

emily: let's get a check of bloomberg top headlines. casino revenue has fallen to its lowest revenue and clutter years, down 39% from a year ago. investors must believe it cannot get worse. casino shares rose 3.5% today. the tech focus private school chain here in san francisco, $100 million have been raised. mark zuckerberg entries hollow

it's are among the backers. also founded by former bloomberg executive and uses technology to allow teachers to create more personalized learning plans. tuition cost about $21,000 per year. and it was america'second-biggest movie premiere ever. "avengers age of all try on" took in second place. it would have done even better if not for the big pay per view boxing match saturday night. we continue our coverage now of the investment conference. stephanie ruhle is standing by with bill ackman. stephanie: thank you, emily. bill, it is always great to have you here. i've got to start with a friend or foe of yours, carl icahn. carl is making comments talking

about his view on activism and what it is doing to ceo's is. what do you think the value of activism is right now? bill: i think it is critically important. stephanie: what about the argument that corporate ceo's's are not making responsible decisions? bill: the kinds of changes and excellent activist proposes they are changes that fundamentally improve a business over many years. they are long-term changes. there are some shareholder activists that push for large leverage buybacks that have a short-term benefit that might be long-term detrimental. for the most part, most that i know, look at nelson phelps, the kinds of changes he is

proposing, these are long-term business changes. look at howard hughes and the other companies we invest in. these are changes for a benefit over the long term. management should be able to ignore short-term -- short-term driven and damages to business. those changes should be ignored. if he or she is underperforming it is likely an activist will show up not for short-term but for long-term reasons. stephanie: you had huge success and burger king. d want to get in the game? you know well how this works? bill: it is one of the great businesses of the world. run correctly, previously burger king, they have done a fabius jobless burger king and will continue to do the same and we like that team. i hope keith does very well with the yum.

a lot of potential. stephanie: are they going to get bigger than that? bill: it could be. health care companies have never been run, many of them are not run with the benefit of the owners. many are very wasteful in a way that they operate businesses. it makes you much less disciplined about cost control. that has created an opportunity. you also have the pressures to keep health care costs down. those combined are creating a lot of opportunities for accommodations and efficiency. valiant has really been leading the charge changing that whole sector. activist is doing similar things. you see in industry doing a transformation in a dramatic way. stephanie: re: seen the changes you want? bill: he has joined the board.

the company will announce earnings within the next few days or so. i cannot comment, but i think it is a great company and we will do well over the long term. stephanie: do you have more success with smaller and larger -- or larger companies? bill: if our ideas are good managed mint teams and boards are generally responsive. stephanie: for you to look at it berkshire hathaway would you say, too big, could never get real control, it does not make sense? bill: i think one buffet is one of the great ceo's's of all time. it is one of those few cases where you could justify the conglomerate structure of the business. i would rather be a shareholder of berkshire. the real question is, what happens after buffet is gone?

what does the company look like 20 or 30 years from now? it is rarely while the founder is alive at a major shareholder that a business needs a shareholder activist. it is when there is no longer a holder in the boardroom. i'm not worried about it being a jet -- an activist for generation. stephanie: are you worried post-warren buffett? he is not a young man. bill: a remarkable job setting up the company to succeed even after he is gone. various subsidiaries run themselves on an autonomous asus. it is a decentralized company. they have got important guiding rentable's. it spoke a lot on building a culture. i was there this weekend. i got a lot of value out of it. he has done an incredible job in graining a culture in the company with the goal of surviving him. i am sure he had those kinds of concerns. it is when sam walton is gone

that is when you worry. and when warren is gone. a lot of companies have not done a good job transition to the next generation, which has created the opportunity. stephanie: you have said in the past, you do not see yourself watching into a campaign like you have with herbalife again given what it overall it has in. do you still feel that way? bill: i think it is very good for outing fraud but not a great and productive use of time. all -- not a p are no matter what the tracker of the short seller is if you come a public win say the companies violating the law, people are skeptical of your motives and so on because you have an opportunity for profit if the business fails. they say you are saying at sibley because you are trying to have a profit. it is not worth the brain damage, i would say. i would have to work very hard

before a public short. i will finish this one. if we get involved in another is a big question. stephanie: you still think shortselling make sense. what about regulatory? bill: it is good for regulation and outing fraud. you do all the work and suffer all the spotlight and the criticism and some amount of reputational damage from inaccurate articles in the press. is it worth that investment in exchange for make -- making a profit? there are easier ways, i would think. stephanie: isn't that significantly easier than a regulatory short, when you're in a black hole of the u.s. government? bill: for sure. the good thing is the fundamentals in the case of herbalife will likely take the company down probably before the regulators do. you expect a back order tomorrow. we continue to expect deterioration in the business to a would love to see the

regulators finish their work. stephanie: worse than regulators not doing their work, when it comes to fanny, that is not the regulators not risk on it. it is the government saying, we simply disagree and we are the rule make a where you stand on that? bill: we think it will make a good long-term investment good eye under -- i underline long-term. preserving the housing finance system in the u.s., if you want a 30 year repayable fixed rate mortgage, a fixture of the housing finance system, i do not think you could have it without fannie and freddie. therefore, the truth will prevail. the best outcome here for the text there is that the company is preserved. the best outcome for the credit market is that the company's preserved. the best outcome for the shareholders. i do not see who is heart by fannie mae coming in -- staying in existence. it should be about how much capital fannie and freddie holds. stephanie: are people even

willing to have that debate? are they looking at what fannie and freddie are doing, or are they too overwhelmed, saying i just do not want a rich guy to get richer. it seems like the issue people are taking. bill: i do not think so. most of the common stock is held by original investors. millions of people own fannie mae stock. 80% of the company is owned by the test there. the only way the shareholders of fannie and freddie get rich if you will is if the taxpayer does very well. stephanie: clearly a long-term tray for you. herbalife is a long-term trade. it is taking a while. do think people do not have a correct perception of what activist investment -- investment is? you are not in and out of anything. bill: no. we are long-term.

we are a long-term holder and will on these businesses for years. it used to be that you criticize an activist for being short term and perhaps there are long-term investors, people trying to create long-term value. stephanie: last week, carl icahn said he is majorly bearish bill:. bill:--bearish. bill: i agree. credit rates are pretty tight. the absolute yields you could learn owning a low investment grade credit is very low. it is hard to make a lot of money borrowing a bond with a coupon unless the credit will improve. that is still a tough that you could be right on improving the move. i do not like fixed income as a category particularly into a's interest rates. stephanie: somebody walking by.

does the timing on fed action mean anything to you? bill: not really are we focus on a few companies p are we are not trading in the markets. stephanie: what is the most important thing to your business? bill: integrity, doing the right thing, focusing on the businesses we own, making sure the right management team is in place, companies making smart agents about the way they run their business and allocate capital. those things matter to us. finding the next big idea per we will have something new to talk about in the next couple of months. stephanie: 100 nine dollars on an apartment hit what will you do with that place? bill: it was an investment. think i bought it at an attractive price, believe it or not, and i think it may be the best apartment in the world. stephanie: using $100 million was a good price? bill: it was like 90. apartment on the park the new building selling at $10,000 per

square foot p are i marty 50% in the money. it is by far the best apartment. if you're interested -- stephanie: you never plan to live there. bill: no. i live a quiet life in a nice family apartment. stephanie: you have got to be able to negotiate that down. thank you so much. bill will be speaking later this afternoon here 2015. stick around. it is getting warmed up. emily: thank you so much. i want to get to julie hyman our senior markets correspondent in new york. some of the companies ackerman was talking about there, take it away. >> one stock that is reacted today that it will now be talking about is the railroad operator who said in an earlier

interview that the despite some expectation that he might talk about it with relation to his investment in canadian pacific he was not going to talk about csx today and those shares are lower as a result of that. some of the other companies we heard about earlier included fracking companies, david einhorn coming out very strongly with eight there is case on those companies, saying their spending too much money, that they have not really adjusted expectations for oil and natural gas prices. in particular, he called out pioneer natural resources, whose shares have been down sharply today. on the bullish side, we heard from barry rosenstein calling out walgreen and qualcomm as his two long picks for today. much more is coming out today on what the investors do and do not like. emily: thank you so much for breaking it down and thank you all for watching this edition of "bloomberg west." we will see later.

-- you later. ♪ .

mark: from bloomberg world headquarters in your, i am mark crumpton. this is "bottom line," the intersection of business and economics with a main street perspective. to our viewers here in the united states and to those of you joining us from around the world, welcome your it we have full coverage of the stocks and stories making headlines on this monday. we begin with greece racing against the clock again three days before the european central bank's next decision on emergency aid. greece and its creditor