justice department any moment. ♪ olivia: breaking news. the guilty pleas have been announced. jpmorgan, barclays, the royal bank of scotland all pleading guilty to currency rating. ubs will plead guilty to manipulating interest rates. we are hearing more about the penalties and fines they are hearing. julie has the headlines. totality of the fines, $5.8 billion to settle with the u.s. five are pleading guilty to criminal charges. of the things you mentioned, citigroup, jpmorgan, royal bank of scotland, and barclays are

pleading guilty to conspiring. is pleading guilty for libor. barclays also reaching a settlement with the new york financial regulators over the currency manipulation. barclays is also reaching a settlement with the u.k. regulator. in terms of getting a little more granular, and what we know right now, we will likely get more details from the various regulatory agencies on the fines, what we know right now about the us's department find specifically, or settlements, excuse me, citigroup has agreed to pay $925 million. million,will be $710 $550 million for jpmorgan, rbs, $309 million.

out with theame details of what they are paying, it is paying a total of $203 million with the doj and 342 million to the federal reserve. those are some of the details we know already about the various settlements and fines. much.: thank you so keri geiger, one of our reporters covering the story from the beginning, we broke it two years ago, is here, as well as brad. good morning. i, we knew this was coming, we had a good sense of what was going on behind closed doors, negotiations. any of this a surprise? is interesting that the one bank regulated in york have todaylays, they

the biggest fine, $2.4 billion. the other banks, we were expecting roughly the number of fines. what interesting to see the actual charges are and what we can expect next with the case. when arad, you are up guilty plea was tantamount to the end of your business. brad: absolutely. you lost your ability to deal with pension plans. olivia: you probably would have lost your ceo. not any longer. we have a justice department making statements. you have also increased the price to the banks because of the civil litigation that is going to follow. once you have pleaded guilty, think of the issue of a

follow-on civil case. you'll never go to a jury. the banks looks like can afford it. the shares are up today. keri: ishares always got. we didn't know what the long-term consequent is it going to be. lynch: i'm joined by it of the justice, department's criminal division, as well as our partners. andrew mccabe, of the fbi's washington field office, and a tongue goldman of the -- aton goldman. we here to announce action an institution that for years participated in a brazen display of collusion and foreign exchange rate manipulation.

they will pay a total of nearly $3 billion in fines and penalties. arey's historic resolutions the latest in our ongoing efforts to investigate and prosecute financial crimes. they serve as a reminder that this department is going to vigorously prosecute those who subvert our marketplaces and enrich themselves at the expense of the american consumer. 2007,ng as early as currency traders at several multinational banks formed a group that they dubbed the cartel. it is perhaps fitting that they chose that name, as it aptly describes the brazenly illegal paid or they were engaged in on the near five-year basis. every day for more than five years, traders used a private electronic chat room to manipulate the market exchange

rates between euros and dollars, using coded language to conceal the collusion. they acted as partners instead of competitors in order to push the market in favor -- in their favor. they influenced every sector of every economy in the world. their actions inflated the bank's profits while harming countless consumers, investors, and institutions around the world. from pension funds to major corporations, including the banks own customers who placed their faith in the markets and relied on it to induce a competitive exchange rate. as a result, for the largest banks have agreed to plead guilty to felony antitrust violations. they are citicorp, j.p. morgan chase and company, barclays plc, and the royal bank of scotland plc. these for banks have

acknowledged their role in the conspiracy and committed to changing their corporate cultures starting at the highest level. have also agreed to pay criminal fines totaling more than $2.5 set of, the largest antitrust fines ever obtained in the history of the department of justice. the find that city court alone is the largest single fine ever imposed for of violation of the sherman act. these unprecedented figures appropriately reflect the conspiracies and the significant impact. to pleadank has agreed guilty and pay a penalty for breaching the nonprosecution agreement is entered in december 2012, regarding minute relation of the london interbank offered rate, or libor.

the breach of this nonprosecution agreement was based in part on ubs's fraudulent trade practices related to the foreign trade market and its collusion with other dispense -- participants. promised inds, ubs other resolutions not to commit additional crimes, but it did. this represents the first time in recent history that the department of justice has found that a company breached a nonprosecution agreement over the objection of the company. i want to be clear. the department of justice, under my watch, will not hesitate to file criminal charges or financial institutions that's resend and banks that cannot or will not clean up their acts need to understand the nonprosecution agreement and deferred prosecution agreement carry very real consequences and

will be enforced. the penalty that the banks will pay, considering the long-running and egregious nature of the conduct, is commensurate with the pervasive harm that was done and it should deter competitors in the future from chasing profits without regard to fairness, the law, or public welfare. today's resolutions are testament to a tireless effort andhe antitrust division the fbi. i want to thank all of the lawts, prosecutors, enforcement officials, and analysts, who could to be did their time and talents to achieving these results. i would expect my deep appreciation for the cooperation and assistance we received on the many agencies who stood with us in our pursuit of justice, including the enforcement bodies , thet mentioned commodities futures trading commission, the office of the

comptroller of the currency, and the financial conduct authority in the u k and securities and myhange commission and giv predecessor, eric holder, who oversaw this investigation from the beginning. hisnt to thank him for commitment to this important work. at this time, i would like to willduce bill bear, who give additional details. that was the attorney general, loretta lynch, announcing fines levied by the justice department against five banks. ubs, barclays, rbs. keri: will there be individual liability? willanybody go to jail --

anybody go to jail? there has to be individual prosecution. people have gone to jail over this. we fully expect this to happen. you have a handful of traders in small chat rooms called the cartel. they were brazenly manipulating the foreign exchange market. it is fascinating that this case ended up being a collusion case. individuals and the banks are guilty of collusion. erik: ubs, before this announcement, disclosed to the world what it was going to face of penalties. it said it was cooperating with authorities in their pursuit of individuals. keri: they were granted immunity. it is likely there are

individuals cooperating. olivia: that immunity was revoked. how about the ceos? this happened on their watch. --d: erik: many of the ceos are gone. bob diamond is gone. jpmorgan seems to be immune to this. it had not had a guilty plea before this. they had the made off settlement in 2013, their giant civil mortgage back securities settlement for $13 billion, they had a number of cases. olivia: it makes you wonder -- keri: it is an interesting point on wall street, even with this stepped-up enforcement by the doj against wall street, there is still not a call for change in leadership.

it looks like the cost of doing business. investors want the shares to go up. they go up every time we settle on one of this cases. they are up quarter after quarter in general. it does not look like that might happen at this point, even with five guilty pleas. erik: we would love to hear from we are hearing from the ceo of barclays, anthony jenkins. i'm going to give you a sense of what he has announced. barclays is continuing to cooperate with ongoing investigations into its foreign exchange when it relation. it continues to cooperate on the investigation into libor, and also into price benchmarks. the company is dealing with these issues as anthony jenkins -- says anthony jenkins, and they deeply regret it occurred. i believe barclays shares are rising. we sell this happen with ubs earlier this morning.

in the roome is with the proper reaction. julie: we are not seeing an enormous reaction for most of these companies are and ubs is trading higher, it was trading higher if and before the headlights at 10:00 a.m. the cousin ubs itself came out and talked about the fines it was going to have to pay as part of the penalty. shares have been higher all morning. you have been talking about the phenomenon when huge fines are announced and the stock goes up. it is the unknown versus the known. it is harder to price something when there is an unknown. what is the size of the settlement going to be? now that you know, it is easier to value. that is why you tend to see these types of reactions. he other stock with a pronounced reaction was barclays. you were just talking about that. these are the u.s. listed shares of barclays, we should mention. they moved higher upon the

release of the headlines and they are up by 3%. as for the other banks involved, jpmorgan, as olivia pointed out, posted a record yesterday, is down very slightly, just a quarter of 1%. city core down four cents at 1%. we are not seeing a lot of movement. rbs, the london share is up about 6/10 of 1%. olivia: rbs says they had dismissed three and suspended two more employees. brad, i want to turn to you on the point julie was making about the limited market reaction, or as is the case with ubs and barclays, the fact that the shares are rising. if the government is trying to make a point, how effective can that point the if the stock goes in the opposite direction of what most people would think is going to happen when billions of

dollars in fines and penalties are levied? rad: we don't have a microphone in the boardrooms of these companies. that is where the rubber is meeting the road. the outside directors are asking management, what are you doing about this? you all know that the over-the-counter markets are changing. they're not changing as fast as perhaps the fed would like them to be. you are seeing calls, for instance, fixed income, for listing of trading prices of the books. that is really quite unusual. -- i would you call it mean, similar to what we're seeing? brad: we are not there yet. we certainly moving in that direction. this is a very large market. it is very liquid. where the manipulation was, was

right at the ends, where he could make an impact on it. unfortunately, there is a lot of olivia: i was try to figure out if this was always going on and now there is a paper trail because of the chat rooms. peter, is this finally the end of the road for the multibillion-dollar bank fines? peter: i do not think that this is the end of the road. the banks wish that was the case that we know the doj is looking also at issue of precious metals and there is the possibility of individuals being targeted. it is not the complete end of the road. what the doj would like everyone to focus on is the fact that they did rip up their agreement with ubs and it proves they are looking at the deferred prosecution investigations, agreements, and are willing to rip up the script if

someone has an something wrong again. that is what they are trying to highlight, a tougher approach from the doj. erik: that raises the question about how tough the doj really is being. if i were a bank and the doj , thatd me of recidivism is essentially what is going on all i get is $200 billion and a guilty plea that clearly means nothing, if we were to judge what we saw with credit suisse. so far as we can tell, they're still doing business the same way they were doing before the guilty plea. the criticism, that it is still not tough enough. their went to watch how ubs self-reported some of the

violations. could they make their case against the other banks without ubs? some of the questions out there are about whether or not the doj are still tough enough against wall street. olivia: every bank on wall street has a deferred prosecution. every bank has more than one, more than likely. if there as the doj is going to the dpa. they what happens if a bank has more plea?ne guilty for repeat offenders under federal sentencing guidelines, things get worse and worse with every conviction. we actually don't know what the doj could or would do with the

banks that are repeat offenders. out: as you begin to put guilty pleas, think about the applications to your funding base, to your clients. andou think goldman sachs morgan stanley investment bankers and on the phone right now, saying, we are not in this. calling every corporate -- treasurer. they just feel fleeced. they feel embarrassed. their cfo is saying, did you know this? erik: you believe this will have an impact on the decisions the corporate traders are making on a day-to-day basis? brad: of course. we will see that when we get into the litigation, the civil litigation. will a fiduciary have an obligation to sue the banks? they have lost money.

--will see how the courts for exchange is a win lose event. if i win, you lose. environment, of will the courts bifurcate continuing contracts? but if you lost, you can see? but if you one, you don't have to give it back? on, someik some peope w people lost. sharp: are the fines enough, the teeth sharp enough? plea affects your credit spreads, your client linkages. there are a lot of sales guys on the phones right now try to explain this. calls intoso question how banks are structured. they do not want to plead guilty and pay multibillion dollar

fines. however, there is so many holes in the oversight. that is why the fed gets in a on these things. they find them for poor supervision. they do not find them for breaking the law. if banks can't supervise all of their very as businesses, and we all know that each wall street business has dozens and how does the department of justice police all of this? to culture.s back a culture of partnership, you would never have done this. you are looking at relationships with clients the go over years -- that go over years. erik: thank you. cook.sor brad, and peter coming up, we speak with the assistant general, bill baer.

you do not want to miss that. ♪

julie: welcome back. we are watching some interesting movers that have to do with the cable industry. late yesterday, early this morning, all teeth agreed to -- to acquire another cable company. one is based in france, the other in the u.s.. this has triggered a wave of speculation about who else al tice might be interested in acquiring. cable.get is time warner you can see charter is trading

lower. it might be a suit or left out of the action. we want to take on the airlines. they are providing a counterbalance to the cable increases. . we saw a downgrade for southwest. we have inventories in a few minutes. olivia: so the come here on bloomberg television, we are joined by assistant attorney general in the antitrust division, bill baer. we will be back within a few moments for that interview. lots more to come and lots of questions for bill baer on news of the big bank five and guilty pleas this morning. stay with us, we are back in just a moment ♪.

olivia: welcome back. i am olivia sterns. erik: and i am erik schatzker. what a morning it has been. banks,pleas from five

mostly connected to the rigging of the foreign exchange. olivia: it was incredible to see the department of justice ripping up the prosecution agreement. erik: that is what they are supposed to do. you break the law, you get a pass, you violate the terms of that pass, ergo you have broken the law. olivia: we have more news. the newsroom. in julie: inventories down by 2.6 7 million barrels. inventories falling 2.6 7 million barrels. 7 million barrels, distillate down. i have oil on the screen behind me. it looks like we are seeing a little bit of that coming off of

the highs of oil, not what you might expect. the drawdown in crude is larger than had to been estimated. you would think that we would see an increase on oil prices. we will see how the people look at them. it'll take a few minutes as the news shakes out in the market. olivia: little bit of a downside on supply in the tory falling. erik: let's look at what else is making news this morning. we begin with the chairman of liberty global thinking that vodafone would be a good partner. he said merging his cable empire with vodafone would be a great fit. he would not say if the companies are in talks. $93 billion value, slightly more than double liberties valuation. olivia: the european company all tice is expanding into the u.s. market.

has millions of customers in a dozen states. revamping the product line appears to be working for target. posted first quarter earnings that beat analyst estimates. the chain said that children's products sold especially well last quarter. u.s. and its saudi allies appear for a potential showdown with iran. a cargo ship continues to sail eden.h the gulf of the saudi led coalition has been conducting airstrikes against rebels in yemen since march 26. the cease-fire expired sunday. erik: those are your top stories

of the hour. problem.tsy has a shares are up 44% revenue fell short of expectations and lost more than $36 million. y is blaming the stronger dollar. alex, explain why the currency fluctuations are hurting etsy so badly? though 70% of their sales are in the u.s., that 30% overseas it's hit by the stronger u.s. dollars. was a 90% of the goods are in u.s. dollars, even if the buyers and sellers are overseas, because they have been trying to market to the shoppers in the u.s. that aetsy has been known for. said, we will

encourage our sellers in the u k, australia, europe. we will push them to sell in their local currencies to help curb the u.s. dollar concerns and grow the shopper market. olivia: is it a rude awakening for the ipo market? alex: it is a potential rude awakening. inwas almost a success story a first quarter of the year that was the slowest for u.s. ipos since the financial crisis. people are watching this and saying if they can be successful, it will be great. today, shares fell below $16. ,t is a bit of a rude awakening with some of the troubles that the closely held companies are trying to avoid by staying private longer. to call itoing something else. i'm looking at some of etsy's

aners and i cn-- alarming trend in administrative spending. olivia: coffee is expensive. erik: 35% from 22% a year ago. an apples to apples comparison, percentage of revenue, 22%, it has swelled to 35%. said, this is us trying to expand globally. they read in their organizational strategy in january, maybe to get a quick expansion as they try to appease the public market. that is something that investors are really paying attention to. expanding the marketing costs. those are up more than 40%, year after year, in the first quarter. that too, a lot of questions on return of investment.

are you actually gaining customers? how quickly are you gaining customers? is it worth it to spend all of these ipo funds? olivia: lots of questions for etsy. we got the distinction between the.com bubble and what is different today. he say the difference is that tech companies are making money. etsy is not. alex: that is the bottom line. if they cannot scale back on expenses, or boost the top line so much that it makes it worth it, investors can be fickle and may have concerns. olivia: thank you. still ahead, much more on the bloomberg market day. walmart welcoming home veterans by offering them jobs. why the retailer is a good fit for fo former servicemen and

women. ♪

olivia: welcome back to the bloomberg market day. we are one hour into the trading session in the u.s.. it is time to get you caught up. i want to start in europe and head over to john. john: yesterday, a big top-down market move. today, it is very much about individual stock stories. the banks behaving aptly, big fines and guilty pleas. byk at this, berkeley up 3.2%. stocks move higher. this morning, a tale of two stocks.

flirting with the possibility of putting those two together, vodafone goes higher. burberry moving south. the biggest loser all morning. that is a concern for that particular stock. for the, the worst day euro against the dollar since march. down by four tents of 1% against the dollar. 1.11 flat. that is how much one euro buys you hear right now. strong rally in the bond market across europe. we pulled back on the 10 year. the two-year, dropping below 0.1% early this morning, for the first time ever. in portugal, six months auctioned with the negative yield. we have had the bond shakeup, but the crazy headlines are

still coming through. at the u.s.g a look , not much movement. we are waiting for the fed to come out at 2:00 this afternoon. the dow closed at a record yesterday. againstumping up records for the major averages. in terms of the stocks and group so we are watching, retail continues to be in focus. target is out with its numbers earlier this morning. company coming in ahead of estimates, trying to improve the quality of its merchandise and merchandise mix. it seems to have paid off last quarter. e's is down pretty sharply. it did not compete successfully against home depot. those shares are down almost 4% after earnings missed estimates. and terms of looking at the

overall indices and seeing little change, on the plus side, we have a lot of the cable companies in the media index doing well. havee downside, airlines been falling today. oil prices, oddly going lower after the inventory report. drawdownthan estimate in crude inventories last week, but oil prices are not getting a lift from that, which is a bit unusual. olivia: thank you so much. in asia, the shanghai composite adding by 7/10 of 1%. in japan, the highest level since april 2000. data showed that japan's economy grew faster than expected. grew 2.4 percent from the previous quarter, beating forecasts and more than doubling the canegains. businesses are showing signs of

spending more and raising wages. it comes ahead of the bank of japan's -- analysts say that at area caution was driven by a pickup and int-- of inventory. shery: that was reporting from hong kong. guilty pleas court, heays, city ubs, royal bank, and jpmorgan. billion, much of this was known in advance, the market reaction is mostly muted, except in the case of ubs. its shares are up 3.5%.

american airlines plans to compete with low-cost carriers. declining fuel costs could help cut fares. american is completing its merger with u.s. air. deltaport says that pulled its affairs and schedules from more than a dozen sites and claims that american and united made similar moves. airlines are trying to pull more flyers to their own sites to keep revenue. olivia: those are your top stories at this hour. walmart is celebrating memorial day with a new commitment to higher veterans. it says is will hire up to vets by the end of

2020. joining us is gary, the senior director of walmart's military programs. thank you for joining us to talk about the terrific initiative. hundreds of thousands of veterans get discharged from the army every year. how many do think walmart will realistically hire? gary: we are very gratified to announce today that after two years of experience with our veteran welcome home commitment, and hiring over 92,000 during that. periods, on a promise that we what amount to a hundred thousand over five years. we are very pleased to extend 250,000 over00 --

seven years and open the filter to those who have separated since may 2013. i was merely say that this is for the next step on a journey that we have been on since sam walton founded this company over 50 years ago. we will see what the future holds. olivia: it is wonderful news that you are hiring all these veterans. what types of jobs are you hiring them for and are they building careers at walmart? is it part-time work? gary: we are very gratified to also learned that more than 8000 of those 92,000 have already been promoted since joining us. many of them are finding careers with the opportunities we have for our associates to build them through the pathways we are building here. olivia: why do you think walmart is a good fit for no terry

veterans? -- military veterans? any: i think we have interesting,, mentor a sense of findpreneurialism that we in veterans today and have found in veterans throughout the years. frankly, i think we find value in them and they find value on us. we think they are the next generation and we are glad that we see that. olivia: we will leave it there. thank you for joining us. still ahead on market day, the end of an era for late-night television. we're looking at david letterman last legacy and the future of . ♪

olivia: welcome back to bloomberg market day. no more top 10 lists, no more

stupid human tricks, no more david letterman. he is saying goodbye after more than 30 years on-air. bill murray stopped by the theater last night and brought a little cake with them to help celebrate. ♪ olivia: he also brought some vodka with them. he was the first guest on the original nbc program in 1982. we want to look at his legacy and the future of television. also with us is --

bill, how has david letterman changed late-night? him, late night was johnny carson, the tonight show, very polished and professional. he became an anything goes, clubhouse, wild ideas, totally creative, he found he went out in the street and did things with people. a reinvention. everybody since has modeled not carson.ave, his influence is expansive. olivia: i'm a big fan and i am sorry to see him go. his ratings have been in the decline for the past 20 years. what do you think is responsible for the decline? was it inevitable?

for his failure to adapt to the new world of social media and viral video? bill: ratings for all television have declined anyway. that is part of it. dave reached up point where he theed as the guy come at man, the cultural center of late-night. the competition with not just jay, but it expanded all over the place. there is no show anywhere near where it used to be. in the last few years, the last 4-5 years, it has become more andnted toward clips showing things on the internet the next day. that is not his style. he has geared down. his coming to the final turn. he has not pursued it with the same energy he used to. he is still good at it, he still puts on a great show. think ishat do you

responsible for the decline? netflix, youtube, john stuart -- jon stewart? you have a general decline of your ship. there is a lot of competition. stewart,olbert, jon conan o'brien. when dave took over, he was only the second. eight or 10e different places you can watch different comedians, not counting youtube or netflix. olivia: what do you think networks learned about the shows like david letterman? can find the right to star and build a show around him, that you can do on a nightly basis, it has always

been economically very sound. the last five or 10 years, the big money machine that these late-night shows used to be have shut down. they don't make very much money anymore because there's too much competition. tonger viewers are able wander off. it is not the same economic engine it used to be. it still has enormous cultural impact. people talk about what is on the shows a lot. politicians go on the show. president obama has been on all of the shows. they are still very important. erik: how do you monetize that? people still care about the cover of the new york news, that nobody wants to buy it. if you're influential but cannot monetize it, what is your future? bill: if you look at some of the things jimmy fallon has done, he

20 5otten 20 million, million hits on youtube, and they are not putting marshall advertising against that. i think it is going to change. have to find a way to monetize those aspects, because there's so much more viewing going on there. if he's in the jimmy fallon only get 4 million viewers a night, he then gets 20 million if he puts on dancing with michelle obama. there has got to be a way to monetize that. a have to take advantage of that. erik: we are living in the fallon, seth meyers air a. what is the next era? lucas: it depends on whoever the next funniest person is. i don't see jimmy fallon going anywhere anytime soon. i talked to a cbs executive will not be named limited she actually watched jimmy fallon's show because she connected with

him. i don't have that you will see nbc-universal selling ads on youtube. they are not happy with the ad rates they can get there. they will have to find a way to make money from all the views that he gets online, because he is one of the most popular comedians in the world, primarily because of all the little that people watch over and over again and share. there has to be a way to make money off that. if they can't, there's not much of a future for the medium. olivia: thank you so much for joining us. erik, you are staying with me. thanks so much. ♪

olivia: good morning. erik: welcome to the bloomberg market day. billions of dollars in

penalties. olivia: god who has some text problems. signals that the irs may not investors do not know what to think. olivia: six banks pleading guilty to market manipulation agreeing to play -- pay $5.8 billion. all leading guilty to currency rating. ubs is guilty to manipulating interest rates. they are runs the doj's antitrust division and he'll put the case together. he joins us now. bill, thank you for joining us. we heard attorney general lynch sath