grab investors from pandora and spotify. thelet: and well i do jane anju jainp asing ceo. imm: problems for distressed assets. we have an exclusive interview with iceland's prime minister. scarlet: good morning, everyone. i'm scarlet fu. pimm: and i am pimm fox. u.s. stocks down just a little bit, the dow jones industrial .2%.ge down by

encourages a lot of movement. a french officials said the president, president obama making comments over concerns over the stronger u.s. dollar. the president denied making those remarks. and of course, the dollar is weakening versus the yen. pimm: all right, let's get a look at the top stories at this hour. president obama called on greece to make what he called "tough political choices." ae president just wrapped up press conference at the g7 summit in germany. the president says time is running out. only our g7ama: not partners but the imf and other institutions represented here

feel a sense of urgency in finding a path to resolve the situation there. pimm: a great delegation in brussels today talking to investors about medium-term financing. one official reiterated the country can not accept more austerity measures. and sears earnings out this morning. 300retailer lost more than million dollars in the first quarter, but that was actually an improvement. here is senior markets correspondent julie hyman. yes, the losses a year ago were more than 400 million dollars. sears is up 20% year to date, and that is on its plan to spin out many of its properties into a real estate investment trust and have the operating company leaseback those stores. shares have been up over the longer term. however they are trading lower today, at a one-month low. even though the losses did shrink, retail operations are

still struggling to save the least. overall sales were down 11%, 7% -- 14.5%and 14 point at sears. and this has been the case for years, those sales waning and that is changing the structure -- and that is something changing the structure of the company does not seem to be fixing. julie hyman, thanks. boeing is considering building the largest ever jetliner. a boeing executive tells bloomberg that airlines want a plane that is larger and flies farther than the current narrowbody. meanwhile airline profits around the world are poised to set a record this year. up $29 billion. north american airlines account for a half of that. the reason -- lower fuel prices

and a stronger u.s. economy. those are your top stories this morning. coming up in the next hour on the bloomberg market day, these shakeup at deutsche bank. the new ceo has challenges and investors seem confident he can do it. and you can be forgiven if you missed it. the women's world cup this weekend. we will look at the tough economics behind women's soccer. and an exclusive interview with agriculture secretary tom vilsack. why he thinks the trade deal would be great for american farmers. we will have that and much more later on this hour. apple kicks off the worldwide developers conference in san francisco and tim cook is expected to unveil a new streaming music service. pimm: it may seem that apple is a little a to b streaming music party, but they can probably afford the delay. they make as much money every day that the entire show music industry makes per month. at the our guest

conference and onset, we have the chief executive of tommy boy entertainment, tom zimmerman. for is the opportunity apple in the music space? guest: they have been leaders in this music space and as they ownershipe digital sales model to a streaming model. pimm: i wonder if you can comment on what is the price point and why would the apple service have an advantage over spotify or pandora or diesel? guest: i think the advantage apple's going to have in the end will be its scale. it will have a huge amount of marketing money thrown at it. they have partnerships with big names artists. partnership with u2 in the past. you can get all of the access to all of the songs in their

library, and you can kind of share songs. it's similar to what beats music has now. ultimately it will be up to apple to convince people to switch from spotify, or more importantly if they will go after the people who have not yet started paying for subscription music service. they want to move over people who do itunes downloads to get them to pay 10 bucks a month. scarlet: adam, there are people behind you, it seems like they are protesting, wearing masks. what is going on? bit of as a little scene. there is a protester here. it's mostly developers. this is a big event for apple where engineers and software coders comment to learn what they are building so they can build apps for the phone, the watch, ipads, things like that. wonder if you can

describe the different pieces of the music business. you have subscribers, downloaders, people buying physical music. peopleere are six ways consume music. traditional radio, the oldest way. physical record sales. over 50%nyl growing at per year. downloads, digital downloads, which is what apple is. scarlet: that is itunes. tom: itunes and others, but 90% worldwide. streaming services, youtube, spotify, vevo. and other ones that are subscription, which is spotify also, but there are many more coming online now. service is apple's new try to do too much? it is this together from its whichng service, it includes downloads, its two year old radio service and also the beats subscription service.

it's a little bit of everything as opposed to a simple business model -- reason the contrary, the apple is successful is they have created an ecosystem where people can live with her music in any possible way. they can store it in the cloud. they can download it. waythey can stream the same spotify will stream, too, and i disagree they will be disrupting spotify or existing players. there is a big advantage to early movers and digital business. in every business, but especially digital. they will be launching on 800 million devices. if they can convert at 40%, xmich is how much sirius converts, they have confidence of users and their ecosystem. they are going to give a three-month free subscription, i believe. at the end of that three months,

if they can convert 40%, we're looking at quadruple the music business. and it's not going to come from spotify users. it's when to come from new people. scarlet: from new people, from iphone users. you -- appleto ask has been negotiating deals with major labels right up until the last minute. we heard from sony music that this announcement will definitely have to do with the apple streaming service. can you give us an update on that? yes, these negotiations went down to the wire. apple has been negotiating for different things, trying to get exclusive content. end, i think it's going to come down to still being a $10 a month service. there were talks earlier in the year about it being a little less expensive than what the other services offered. to work not been able out. a lot of the details today will be fleshed out. , i want to ask you

about music industry revenue. give us the outlook here. tom: you have to look at things on a per user basis. i must as a user pay for music every year -- how much does a user pay for music every year? revenue out the average per user is highest, far higher than digital downloads, and far higher than skills with subscription services and 10 times higher than ad supported services. scarlet: i need to ask you. taylor swift took her music of spotify. the beatles are not available anywhere. i know they are on itunes if you buy the album. the music industry's excited there are many artists looking at it from the old school perspective -- when you changed the mentality from a

record buying mentality and an average per user mentality, how do we maximize revenues to increase the overall value of have not beents able to put their arms around that. million subscribers worldwide. 6 million or 7 million in america. i'm sure it is up to 10 million in america. if apple comes on strong, we could be at 50 million just in america. which is amazing. there's only 27 million subscribers to sirius xm. much,t: thank you very adam, and of course, tom silverman, founder and ceo of the record label, a boy entertainment. still ahead on the bloomberg market day -- tommy boy entertainment. still ahead on the bloomberg

market day, j.p. morgan shares surging. ♪

scarlet: welcome back to the bloomberg market day. i am scarlet fu. pimm: and i am pimm fox. scarlet: let's head over to julie hyman. a lot of economic data, a lot of movement in stock prices. julie: not the movement you would expect unless you have been watching the u.s. stock market of late. it was not exactly positive. imports fell and we saw trade contracting the first five months of the year, and yet the shanghai composite up 2.2% and trading at the highest point in years. it seems like the phenomena in we see in the u.s. where bad

economic news can be read as positive, because the interpretation is there will be more stimulus. you see the entry day and then you look longer term and we have the seven-year high -- you see the intraday and then you look longer term and we have the seven-year high. and we also see the u.s. and the etf's that track chinese stocks fxi etf, andt the the ishares that looks at the trades on the mainland. all the way over here in the yellow line is japan, which has remained kind of flat, call it $5 trillion. all the way up here is the u.s. and about $25 trillion. we have really seen this climb in the size of the chinese market and it's now approaching $10 trillion. what also want to look at

has happened through the price to earnings ratio in china. just like in the u.s. you have frequent talks -- are we seeing a bubble in china. it is about the overall market. right now we are almost at 26 times price to earnings. it's not just the level of velocity where we have seen this huge climb in p/e. it is really year to date as the stock market there has recovered. it's really about the value of chinese stocks and if they are worth it -- scarlet: and that is the debate. it may not matter much if msci adds china to its indexes. we are waiting on that later this week. pimm: thanks very much. let's look at top stories crossing the terminal right now. ma isa chairman jack coming to america -- to look for more revenue. he will be in new york and chicago, pitching china's middle class as a growth market or u.s. is mrs., as well is his own

e-commerce -- u.s. businesses, as well as his own e-commerce company. 50%.uld like the htc nightmare is not over. on friday, htc cut its fourth-quarter sales projections by more than a third and that led one analyst to cut his price target by 37 present. he says that htc will keep losing market share and money. nora videogame osborne turned mogul from china has learned there is no such thing as a free lunch. the annualn won charity auction lunch with billionaire warren buffett -- the price more than $2.3 million. the money goes to a charity in providesisco that meals and housing for poor people. and those are your top stories. all right, a mandatory

shakeup at deutsche bell sending these stocks soaring. still up almost 5% -- actually 5%. and that was after the co-ceo announced he will step down. let's look at the challenges for cryan, as well as the bank, with our correspondent who covers the bank from germany and also our executive editor for finance christine harper. christine, let's begin with you. a surprise move? is a shock.his a few weeks ago they were giving more responsibility to anshu jain, and it looked like the management team was in place. they got through the shareholder meeting, i'll be it with a low percentage of the vote approving them. but it looked like they were going to give anshu jain and jürgen fitschen at least another

year to prove they could get their strategy through and no one would have picked this guy john cryan, who is on the board, as the likely successor. this was a complete supply. scarlet: how likely is he to deliver on this strategy as outlined by anshu jain? cryan is crisis experienced. when he came on board it was 2008 when the subprime mortgage market was declining. ashas this reputation someone who can crunch the numbers, understand the numbers, and pulled through the execution. that is something deutsche bank needs as they go into the strategy. does this mean, that deutsche bank will remain committed to the universal ranking strategy? christine: certainly all of the

language in the press release was this is going to be to further their strategy 2020, which is what they recently announced in april. there's no indication they are changing the strategy. one of my colleagues talk to a very top investor at deutsche bank yesterday, and he says what he is waiting to see is not only if there is execution of the strategy, but some changes reggie and there is a debate on what that should be. some people want that to be clearer. break up the bank perhaps. some people want that to be to move quicker and it's unclear how they will get there. thelet: talk about importance of georgia bring to germany. it is one of the largest private employers. talkor all the anshu jain about selling one of the retail units, i'm not sure what that was politically. reporter: deutsche bank is sort of the national champion. everyone has this view that

deutsche bank has to remain vocal and provide everything to everyone. and that is a question of how much influence that has on this strategic review and what they are allowed to do. that is one of the big questions. deutsche bank also is definitely seen as the bank that represents germany on the retail side as well. have anitely does and effect on the country. there were reactions from large labor unions and so on and so forth. it's a very heavily-watched bank here in germany, definitely. pimm: christine harper, is it n will that john crya initiate layoffs at the bank? christine: i think there is no question there will be really a us. a what to cut expenses. -- i think there's no question there will be layoffs. i do not think anyone thinks they can get there by cutting

the travel budget. but that is politically fraught. tot of what cryan will have navigate is political and investor competing desires. pimm: thank you very much. our thanks to shane in hamburg and of course, christine harper, here in new york. -- if i hasing up only percent of its budget on women's soccer in the last four years. -- fifa has only spent 1% of its budget on women's soccer. can it become a global event? ♪

pimm: all right, it is day three of the 2015 women's world cup. similar to the men's tournament it is organized by fifa, which is mired in scandal. but that's not the only issue facing women's soccer. bloomberg's david gora reports. david: seen the likes to point

out that interest in the women's game has grown since the first women's world cup 24 years ago. it is estimated 20 million women and girls play soccer today, and sepp blatter said that fifa wants to see that grow over the next four years. but fifa is still faces challenges, and one of those is money. sepp blatter has talked about investing in the game, but only 1% of the fee for budget was set aside for developing women's soccer. one of the best players in the world is 29 and has been on happened doesn't teams, half of which have folded. women's teams have a harder time attracting sponsors. sponsorship of women's soccer is valued at $5.4 million. compare that men's game. than $61 million alone --014 world cup

for good 61 million dollars of 461 2014 world cup alone -- $ million dollars. this years old women's world cup will be a chance for women soccer to win over new fans, but women's soccer has the hardest time winning over are the members of fifa itself. they surveyed the membership and only 5% said women soccer is an attractive area for investment. scarlet: thanks. pimm will be right back. pimm: ♪

to theelcome back bloomberg market day. i am pimm fox. top stories athe

this hour. president obama says cyberattacks are only going to get worse. last week the government said that chinese hackers stole data from millions of government workers. the president said that the government has to do more to stop these attacks. president obama: we will have to be much more aggressive and attentive and this problem is not going to go away. it's going to accelerate. and that means that we have to be as nimble, as aggressive, and as well resourced as those trying to break into the systems. pimm: president obama said the united states is upgrading the systems it uses to detect cyberattacks. in south africa, officials are recommending former olympian oscar pistorius be released and go under house arrest. he was convicted of a charge someone to manslaughter for shooting his girlfriend. he received a five-year sentence. prosecutors have until november to appeal his acquittal on a murder charge.

and shares of mcdonald's are little changed after shares of the restaurant chain reported sales that beat estimates. sales fell 3/10 of a percent, but still that was that are than expected. growth in europe helped to offset a decline in the united states. the new chief executive unveiled a turnaround plan that includes reorganizing management and cutting costs. and sales of the airbus superjumbo jet could be heard by used aversions hitting the market. several international carriers are seeking buyers for their a380's. sell 30 to break even, but has not landed a new customer in three years. it is the largest commercial jetliner, seating up to 540 passengers. those are your top stories at the moment. at the moment, the market is closed in europe, so for the latest i will go to mark barton in europe.

mark? a fifthwn for consecutive day, predominantly a red across your screen. investors digesting the turkish election, the impasse between greece and its creditors, and of course weak import data out of china. those three factors driving on european stock markets today. bank, not one of those stories -- it has a new chief executive, john cryan taking over from jürgen fitschen and anshu jain. shares of 3%. 7%, theou know, up biggest gain since 2008. -- diageo. a swiss drugmaker -- there is a report that a company in

ireland is interested in buying actellion. i just want to finish with a fascinating chart. the dax in germany today in correction territory. this april, the dax is down by this much. as we all know, 10 percent is a correction. what is astonishing is, from january through april, the dax index actually rose by 30%. still up by 20% over the year. back to you in new york. pimm: thanks very much, artonberg's mark b from london. could louis vuitton be teaming up on a website to rival amazon.com? well, we will have the details. 12:30 p.m. eastern,

david stern. votedd fell parliament unanimously -- but it will impose new taxes on investors trying to pull their money out. iceland's prime minister is with us on the telephone now from their capital. prime minister, thank you for being here. could you tell us what is this new tax and who will it apply to? guest: hello, yes. it will only apply to the state banks, so it is not a tax on new investors or anyone else. failed banks have been the main hindrance when it comes to capital controls, simply because they were so huge in comparison with iceland's economy. when the banks fail, they were

10 times the size of iceland's gdp. they have been in the unwinding process for close to seven years . they have been doing quite well, so to speak. because the assets have been .rowing steadily the capital controls have provided sharper and they have quite high interest rates within iceland, but they cannot just realized the profits until the capital controls are lifted. it is to everyone's advantage. but it means we will have to put stakes. on new we reached the agreements by the end of this year, they have until the end of the year to reach a compensation agreement and take certain measures, which

-- they will be except from the tax. pimm: prime minister, do you have any message for investors who purchased the debt of the icelandic banks? guest: i would like to congratulate them on the money they made from investing in these assets, because i think well over 90% of the claims on these banks were bought after the fact, after the banks begin with,nd to only a fraction of the nominal value -- it is now considerably higher than that. they have done quite well. pimm: are you prepared for legal challenge? obviously, there are all

sorts of legal issues which have been ongoing in the courts and outside of the courts in iceland since the financial crisis. that is something we were prepared for. as well as the other major decisions taken. however, we are very confident in the legislation we have just presented, and have no doubts about its legal validity. i would also like to mention the fact that it is certainly to be advantage of the to gett, the creditors this issue over with and minimize uncertainty as soon as possible. pimm: prime minister, would you have any lands to restore the free flow of the kroner? guest: yes, what we are doing

now is the lifting of controls. and in a sense, the kroner is freer than before -- it will be taken this year. pimm: this year? guest: that's right. this year. -- general public may longer may no longer feel these capital controls. course, foreign investors will continue to be open -- it will continue to be open to foreign investors, as it has been. it is all quite promising. thank you very much for your time, iceland's prime minister. still ahead on the bloomberg market day, president obama's fast track train authority. we will hear from agricultural secretary tom vilsack about the trade deal. that is next. ♪

pimm: welcome back to the bloomberg market day. i am pimm fox. to begin with top headlines. cbs is adding showtime as a partner for its set-top service over the internet. the service begins in july. it will allow viewers to watch shows without signing up for conventional a television. theanyone with claims from gulf oil spill has until midnight to father claims. so far over 320,000 claims have

been submitted. bp may have to take $10 million to settle all of those claims and warn investors the amount could be significantly higher. the u.s. supreme court has turned away a national rifle association challenge to a sentences hogan lopp. the law requires -- to a san francisco gun law. the law requires people to store their guns in a box with a trigger lock. your top stories at the moment. in washington, the obama administration is working on its trade deal. they are trying to convince the reluctant house democrats to houseim house democrat -- fast-trackhim trading authorities. i am joined by peter cook and agricultural secretary tom vilsack.

peter, is he concerned? peter: i asked if he could get it across the finish line given the resistance from members of the president's own party? vilsack: i do. i think it will make a big difference to the american economy. why is that? you have such reservations from democrats, including democrats in agriculture states. not everyone is convinced. we faced vilsack: terrace in other countries as high as 200%. this is an agreement that will lower tariffs.

our ability to have a science-based and rules-based system. it will give us the opportunity to make the case to the rest of the world on why to buy american. there is no question my view this is a multibillion dollar increase in american agriculture on top of record agricultural exports. case this isde the a win for agriculture, for the broader u.s. economy. is that a multiplier effect? secretary vilsack: you are looking at potentially $21 million being added to exports and we know exports creates higher thing jobs. if we increase exports, you're talking about 6500 jobs and those jobs pay on average 10% more than non-export related jobs. better jobs, better paying jobs. an agentalking about population that has 525 million

middle-class consumers. tremendous opportunity for us. peter: mr. secretary, why is this such a tough sell for democrats in particular? secretary vilsack: i think probably we have not done a job along the way of pointing out the benefits of trade to the american consumer, american business, american workers. it's very easy to talk about a plant closing and how devastating that is for employees who may have lost their jobs. when we are not talking with equal passion about opportunities being created. that is weighed is important that we have this trade agreement and have trade adjustment assistance to make sure we have the tools and resources necessary to take short those who are impacted negatively by trade are given the opportunity to take advantage of what the best aspects of trade are. peter: are you worried that this could be a lasting tear in the democratic party in particular? secretary vilsack: i'm not concerned about that. i think there are so many more

issues we are in agreement on from the expansion of access to health care to improving our education system to raising wages in this country to creating new, innovative opportunities -- i have no question that this will be a united democratic party, notwithstanding we have a division on this particular issue. peter: would it help if hillary clinton came out and said i'm in favor of this? secretary vilsack: what really notters and this is what hillary clinton says. it is what the rancher at home says. we need them to speak up and speak passionately about their support for this, too match their passion and there are over 70 agricultural groups and we need to make sure their voices are heard. k may beecretary vilsac confident, but they need to round up votes.

john boehner will have to deliver 200 house republicans. even if it passes, the margin will be very, very close. pimm: peter, it you also got a chance to speak to the secretary about the 2016 election. he is the former governor of iowa, for heaven sakes. peter: he has history. he ran for president himself in 2008. he is very close to hillary clinton of bill clinton as well. i asked about her challenges in iowa and if she will face of real competition from bernie sanders and martin o'malley. he said without question, she would be in for a fight. president obama: this is not a done -- secretary vilsack: this is not a done deal. she has made all of the right first steps. she has an organization running out. they have people working to build relationships that are very important to islands

--iowans. gave: remember, iowa hillary clinton a pretty chilly response the last time she ran for president. pimm,ucus system, presents challenges. also, he says gubernatorial experience does not count in terms of foreign policy experience. he knows that first hand when he came to washington. one thing to watch, when the republican start mounting their challenge -- not only to win the republican nomination, but take on whoever the democrat's. he says running a national guard is not sufficiently comes to foreign policy. much, ourk you very chief washington correspondent peter cook. thanks. still ahead on the bloomberg market day -- luxury is looking to make a move online. we give you details, coming up. ♪

pimm: luxury goods.

they are in high demand. well over $250 billion last year. now they are trying to bring their brick and more in her's success to the world of e-commerce. olivia sterns, my colleague, joins me now. do you like this idea of a team can prized of -- comprised of gucci and the company that runs cartier all online? olivia: i think it means something that they took the time to reach out to the to see if theyh could do something online. it's almost like the head of coke called beheaded of pepsi to see how they could sell soda better online. called the head of pepsi to see how they could sell soda better online. vmh, the website itself gets a

hundred million visitors -- pimm: i'm assuming that the good thing. olivia: it's a great thing. that's 1% of their total sales. people still want that experience, they want to go in the store and touch and feel the product they will spend $100,000 on. means the luxury companies need to maintain relationships with this tribute or's. these are high-end department stores. if you cannibalize sales there, why with the department store continue to do business with you? olivia: they are very concerned about managing the perception of -- exclusive this city of the exclusive nature of their product. you are giving up control, but of easily this is were the growth is going forward, and like everything, these days it really seems to be an omni channel experience. you are seeing a huge amount of conversion.

discounts online -- at least no word of any discounts. olivia: not yet. well done.ight, see you in just a little bit. thank you very much, olivia sterns. it's time for today's options in sight. for that, we go to julie hyman. julie? julie: thank you. let's look at how the major averages are performing. we have a little bit of a pullback with each of the major averages, each of them down according to half of 1%. as wech volume however enter the summer trading season. joining me for today's options in sight, a strategist at mkm holdings. we were talking during the break about how we had a little bit of in the vix,ump up and now we are back down again. guest: right, there has not been sinceversion in the vix

january. the longest prior. in this lower volatility environment was three and a half months. really the way we look at the vix, we are pretty much do for some volatility to lift. that said, it is languid. the markets are pretty quiet. to be if there's going volatility, you sort of have to make it. you need a catalyst to spark that, and it seen -- it does not seem like -- is there anything on the short-term horizon that would make that happen? guest: arguably, no. greece has been included out a couple weeks. but you had the strong report from last week from may. that had some additional rate volatility that is of the sleep feeding into currency ball -- that is obviously feeding into currency volatility. i think you can put the pieces together to get equity volatility higher. and do not forget that europe is

down now almost 9% in euro stocks -- eurostoxx. vix is as wide as it has been in the previous five years. julie: it does not mean they ually trigger volatility? is coming.hink it we are trying to position clients for that. the one metric that suggest defensiveness is the open therest put/call ratio of vix. approaching that level. times done a good job over of foretelling increases in volatility. elsewhere, very complacent, but that is one metric flashing yellow, maybe read. julie: let's go to your trade of

the week. we do not have much time -- we look at opportunities to mitigate risk. two names -- cinezar and redhat. what we want to do is give a very full valuation. -- finiesar. stock potentially for m&a, but a nice thought you were nation. a good strategy to maintain exposure, but realize the gains on the underlying stock. julie: good to see you as always. much more bloomberg market day after this break. stay tuned. ♪

pimm: in his 9:00 a.m. san francisco, and it is midnight in olivia: shares have jumped the most

since deutsche bank announced its new ceo. pimm: we will have the information from the developers conference in san francisco. olivia: and the nba finals. ♪ pimm: good afternoon, i am pimm fox. olivia: i have olivia sterns. let's look at where markets are trading this hour. the stocks are little bit off, as european leaders are pushing for a resolution to the greek debt crisis. stocks were