erik: i'm erik schatzker. hsbc makes it cuts. deutsche bank is overhauling and gets rated. stephanie: also ahead, new apple music. yes. new apple tv no. fresh from a game three victory the tampa bay lightning owner on the stanley cup and building a successful nhl business in what other state but florida? jeffrey vinik in the 9:00 hour. erik: it is time to share some of the top stories of the morning. greece has come up with another plan designed to unlock bailout funds. alexis tsipras submitted a three-page proposal of fiscal targets. one official says the plan is a rehash. there is a report out that

chrysler wants to merge with general motors. sergio markey only has been talking with hedge funds and other potential allies. for months he is argued the auto industry needs to consolidate. the journal says he sees activist advancers -- activist investors as one way to push gm into a merger. stephanie: that traitor blamed for helping caused the flash crash faces an extradition hearing. a judge made the ruling today no vendor sings around -- navinder sarao has been -- the u.s. wants to put him on trial for market manipulation and wire fraud. may was the wettest ever month reported in the united states. heavy rain that flooded the midwestern states were to blame. the u.s. got four and one third inches of precipitation. the records go back 120 years. erik: let's get you started with

the five things you need to know this morning. stephanie: let me tell you, when i heard number one this morning, it took me 25 minutes. i said, that i have read that number right? a it -- hsbc announcing they are cutting up to 25,000 jobs eliminated in the next two years, 10% of their workforce. another 25,000 jobs will be cut by selling operations in turkey and brazil. hsbc plus chief is trying to cut costs by $5 billion a year. in total, -- i thought i read 5000 jobs. 50,000 jobs. these banks have been cutting jobs aggressively since 2008. take us back to 2006.

what was going on? erik: they were hiring a lot of people. the economy and the markets were inflated by credit, not that they are not now, just a different kind. public instead of private. they were hiring like crazy. now we live in this world of tough economic -- of tepid economic growth. thanks are being regulated out of businesses. a have no choice but to cut if they want to meet targets. it is a human tragedy for this many people to be losing their jobs. stephanie: that is crazy. erik: ge is selling its sponsor finance is this -- finance business. for $12 billion. the buyer comes from north of the border. this is the largest ever deal for the cpp ib. the managers of this ge business

are going to be part of the buyout. between the ontario teachers plan, canada has some of the most aggressive real money investors in the world. a lot of americans do not know this, the cpp ib is the investment arm canada post social security. people here talk about letting social security's invest in stocks and buyouts some of they are doing it up north. stephanie: they are also americans. north americans. erik: so are mexicans. are we going to get into this today? julie: they are so progressive in canada, aren't they? let's go to china. equities are down today before the ms di decides whether it will add mainland china security jury -- securities to its index.

the shanghai index was falling from her seven-year high. the 12 month rally in the shanghai composite has added $6.5 trillion in market value to the value of the chinese stock market which is incredible. now approaching $10 trillion and still dwarfed by the market size of the u.s.. it is the velocity with which we have seen the rally in china -- on the one hand it has made a lot of people a lot of money on the other hand it is causing some to debate whether they are seeing a bubble in stocks. erik: if chinese stocks go into the mi -- into the msci, we will see more of the same presumably. julie: all of the funds that use it as a benchmark will have to add chinese stocks as a result. on the one hand, it is a vote of confidence, a validation.

on the other hand, it will have that ripple effect and because it is such a big market it will make up a big chunk of the msci emerging markets index. stephanie: i have to get to number four. i start foaming at the mouth woollies -- when we talk deutsche bank. it's frankfurt offices were searched yesterday. the search is part of an investigation into security transactions by clients. a spokesman says the bank employees are not accused of wrongdoing. i made some calls and that is the case. when there is an investigation like that one might say no one has been accused of wrongdoing yet. they are looking for something. erik: they were ratied yesterday -- raided yesterday. it sounds like investigation over russian trades. allowing people to dodge taxes -- the raid took place today.

as we learned last week under investigation over allowing -- potentially allowing clients to dodge taxes and not disclosing the proceeds to tax authorities, this is all about taxes. stephanie: and wrongdoing. erik: number five, cerberus capital management is expanding its reach into the home rental market, buying about 4200 homes in the united states. this purchase will make cerberus one of the top 10 owners of homes in america, joining blackstone for example. stephanie: if you are cerberus they have always been in the real estate space that now they are taking a bigger stake. they need to spend money somewhere and right now, if you look at the housing recovery it has been slower than many thought it was.

they are not talking about buying 4000 homes in the greater new york area. erik: this is in the midwest. the timing of this trade it could be a trade or an investment, we will see how quickly they get out of it. it is a trade for blackstone. the largest homeowner in america with the intent of getting out. they are in the process of getting out. blacks down -- blackstone is getting out, cerberus, going in. stephanie: we have to talk apple. erik: disrupted the music industry by introducing the ipod. can lightning strike twice? apple music introduced to the world taking on the likes of spotify pandora and tidal. i want to know more from you about what it is that apple introduced and how competitive or disruptive this might be to

the music industry. tim: disruptive, perhaps not. and all in one app called apple music. you will be able to gets of scripture-based music. you'll be up to play downloaded songs that you have on your phone -- subscription-based music. you will be able to play downloaded songs that you have on your phone. $10 a month. stephanie: what has the response been? tim: you have seen upstarts like spotify take some dominance in the marketplace. apple is the world possibly largest music retailer. they created this idea of the downloaded ecosystem. they made it popular amongst us all. now what is at risk as we go forward into a system where people want to subscribe to music and stream it on their

devices, they want to make sure they do not lose that ability and that place in the marketplace. it is about making sure that this device is the center of your entertainment world, whether it is music, video, reading, they want to make sure you are doing it on this. erik: what does it say that apple is going to be taking apple music and making it available on android? tim: it is a big play. one of the big surprises yesterday at their developers conference where they made this news. traditionally they have not ruled out their services for anybody outside of the fenced in world of apple. you get the scale, it will be important beyond apple. stephanie: i did not hear anything about apple tv. tim: the news of the day what was not -- was what was not announced. negotiations were underway in

hopes of having a deal to have streaming television service announced. those talks are still going but they are proving difficult. a situation that tim cook finds himself in is this changing and evolving media landscape whether it is music being streamed on your device or tv that is not being watched in traditional ways whether it is cord cutters or folks that want to download snippets of television apple is trying to find its place in this media echo system. -- ecosystem. erik: what more did we learn about apple news? tim: another example of apple trying to be a device for whatever content you want to provide. a new app that allows you to consume the printed word in a different way. a beautiful kind of layout. deals for content with such affiliates as the new york times, even bloomberg. stephanie: if they wanted to

have the most important canadian, they could've called schatzker. we know drake has been at odds with jay-z. what is drake doing there? tim: lending support for the service. they have to get artists on board with apple music. erik: tim higgins in san francisco. stephanie: i love to talk about drake but we have to go to breaking headlines. vonnie quinn has more on greece. vonnie: we have the german finance minister saying he is on the same page with angela merkel. nothing new that we have not heard before. we have heard that greece has submitted a three page proposal to creditors. this is being not well-received by the germans and we have to greek two-year yield above 25%.

stephanie: not being well-received by the germans. there is a surprise. thank you for giving us the latest. will be back on more with the economy practically spewing jobs. maybe the hawks are missing something. stick around. ♪

stephanie: still ahead, matt salisbury will join us to announce a substantial new round of funding, the opening of a distribution center and more. ron tate is here joining us on his decision to buy barclays wealth management unit. you know the story, treasury yields surged to year to date highs, much better than expected jobs report wowed wall street.

what can the fed to do to raise rates. my former colleague and friend don says -- joins us now. you say they do not need to raise rates? dom: the market is not convinced they will raise rates a lot. even in september the pricing is 50-50 and there is only one hike for the year. i think the reason why a lot of people think the fed still has to be cautious is because the economy is not firing on all cylinders by any stretch of the imagination. erik: if you look across the developed world, to you agree with the notion that bill gross has that there is going to be a compression of the differential in yield between germany and u.s. treasury market we will see overtime? he has a short on german bund.

dom: in the end, although we have seen decent compression because there has been such a massive amount of performance in germany over the past few weeks. that has been a reappraisal of the impact of ecb buying in europe. the term premium got crushed in europe. erik: will we look back on this selloff in the bund market a year from now and liken it to the taper tantrums? dom: europe is a long way away from having the same recovery. it is hard to argue that germany needs to underperform. it should continue to underperform a bit. especially if the fed raises rates. the bulk of that trade is

probably over. stephanie: where is it that you see holds not being as productive? dom: one really obvious. all the job growth we have seen has come at the expense of productivity. the answer some people give to that is we could -- the reality is gdp has been going sideways since the labor market has strengthened. stephanie: how so? dom: it is like when you add a new worker to your workplace, your output does not exactly go up. it might even go down. the result is productivity is zero not negative. stephanie: eric is nodding. that is what happened when they hired stephanie. erik: we lived through the productivity miracle of the 1990's. we are living in a transformative technology age in

this decade yet we do not see any impact on productivity let the one we thought we saw in the 90's. dom: it is difficult question to answer. when you have zero to one, it is an impact. issues like that i think are important. we appreciate a lot of the new technology we put into place. there are other arguments people use. this is not a u.s. phenomenon. the u.s. has higher productivity than anywhere else in the world. it is bad everywhere. it is terrible in certain places such as europe and japan. stephanie: in the u.s., things are not going to be perfect. does the fed have to check every box before raising rates? dom: when we had full employment -- when we hit full employment productivity ought to recover because companies substitute capital for labor. if that does not happen, either

growth is going to slow down with wages going up in which case you have a nasty outcome or it may slow down without which is going up which means you have stagnation concerns. erik: is there value in any sovereign debt market? dom: i think there is relative value in the u.s. it is a high-yield or relatively speaking. japan's looks a little cheap to europe. injured -- in general, the issue is central banks have driven premiums out of the system. that is especially true on the inflation side. your concern is that has to normalize in the long run. stephanie: rates will be raised when? dom: 2016. stephanie: thank you. dom konstam.

♪

stephanie: welcome back to "market makers." let's talk about something i never use, voicemail. fewer people in their personal and professional lives are using the surface -- using the service . companies are cutting services. >> the telegraph, the pager, the typewriter, no one really uses them anymore. and this voicemail is starting its slide into the history books. pushing this downturn are

companies like these, jpmorgan says it will drop service for about 136,000 consumer bank employees, that is 56% of all staff. savings, about $3.2 million. coca-cola says the same thing. dropping voicemail to the tune of about $100,000. citigroup and bank of america are thinking about dropping voicemail as well. voicemail service providers lik stand to lose. >> your call is being answered by arctic's. >> owned by avaya. other major providers who should be watching the voicemail slide. while voicemail use has declined, texting has rocketed.

it is faster and people are more mobile with more mobile phones. in 2000, u.s. mobilephone users and about 12 million text each month according to a study. that is nothing compared to 2014 when 561 billion text were sent each month. that boils down to nearly 500 texts per month per person up from 60 a decade ago. see how you compare the rise of the texts in the fall of voicemail are intertwined. stephanie: i am going to say at any point i probably have 10 voicemails i have not listened to. 8. when i call people, often times the voicemail says i never checked this message -- i never checked his line, call me on my cell, to send me a text. erik: i had to change my

voicemail message because it says leave a message. stephanie: he has one of those long hi's so you think he is answering the phone and then he goes, i am not here right now. erik: might be deliberate. stephanie: hi, hey, i'm not here right now. erik: hsbc cut it -- the latest on this structuring effort. stephanie: 50,000. ♪

stephanie: you are watching "market makers." general electric has taken another step in their retreat

from banking. ge has agreed to sell the majority of its private equity lending business to the canada pension plan investment board. a cool $12 billion. the unit has eye out firms lining up. it is the first sale of a major business. tough talk on greece today from germany's finance minister. he says the ball is simply in greece's court. he also said germany would be daft to play a blame game with greece. one official told bloomberg it is a rehash of older plants. san francisco officials are deciding whether to impose a warning on ads for sugary soda pop.

one ordinance calls for health warnings on billboards, calves and buses. it is one of three anti-soda proposals on today's agenda. -- billboards, cabs and buses. erik: europe's largest bank is about to get smaller. hsbc plans to cut as many as 50,000 jobs through 2017. it is part of stuart gulliver's effort to and stored -- to restore investor confidence by in a bank that has been battered by scandals. jonathan tice is with us from london. i think our viewers have been hearing two figures today. 50,000 and 25000. stephanie: both insane. erik: help us out. jonathan: in terms of what they

are doing, they're disposing of two businesses. what hsbc has said they will do is they will cut their headcount by up to 25,000 people a lot of which will be back office and they will spend a lot of money investing in i.t., web-based solutions to try to pick up some of the slack. hsbc and jobs at risk at the moment, that is the 25,000 figure. stephanie: one of the issues banks face when they decide to go to web-based services, the jobs do not go away. they still need teams of people to implement those services and protection because they do not want to have only the internet only online option. does it really cut jobs or cost more money? jonathan: if you look at hsbc relative to other banks, they have been inquisitive and both banks together both businesses

together. there is a fair bit of fat that they can cut. a fair bit of i.t. acceleration that they have not been doing to date. erik: what is the motivator for stuart gulliver? is it a single number like price to book? hsbc continues to trade at a discount to book value. jonathan: the motivator is the fact that along with jpmorgan it is designated as the most important bank in the world. that brings enormous capital charges. hsbc needs to relieve some of its capital burden. emerging markets businesses, high credit risk, those are businesses -- the bank of england stress test is targeting asia and emerging markets to figure out whether it is asking

banks to hold enough capital. the motivator is to return -- improve returns on equity which should be reflected in higher price-to-book multiples. erik: why is it that so many ceos won't make the other logical decision? just to get smaller and break up. if your bank is so large that it is among the most important institutions in the world the regulators are telling you it will be less costly to be a smaller bank. jonathan: one of the things i would answer shrinking risks assets by quarter or. they are shrieking. one of the interesting slides from the presentation, they show how resolute best mitchell how regulators look -- they show how regulators look. they facilitate a lot of client business. that is what gets them in trouble y's.

if you look at jpmorgan or barclays and look at their regulatory score, it is complexity. hsbc is shrinking. stephanie: could hsbc consider getting out? when we look at security businesses, banking businesses they have the headcounts to do not see them anywhere on the league tables. -- the lead tables. jonathan: one of hsbc's roles is to facilitate global clients there needs. one of the things they have been clear about is the dollar business, the u.s.'s relationship to world trade players, is vital to business. they are committing to improving profitability. will they shriek certain businesses -- will they shrink certain businesses? yes. they acknowledge they cannot retreat from the u.s..

they have to have a good presence there. erik: you pointed out hsbc is shrinking by virtue of giving up -- reducing its risk related assets. is that going to persuade regulators to up ply -- to apply a smaller capital surcharge? jonathan: probably not. it is not about complexity. they across jurisdictional businesses. they told us what they think unfunded capital requirements are. the 44 billion, which is a lot less than you could get if you wanted to be harsh. they are comfortable and the fact that they have given progressive dividend promise again, they're comfortable with cap ability. they would've talked to authorities. it will shrink that i think y's, they are in a good -- y's they are in a good addition.

-- good position. erik: 25,000, but also 50,000 jobs being cut by hsbc. half of those jobs will end up one else's hands. stephanie: i make the argument why do they need to be in all those businesses? they say they need to be a global platform why? clients will do business with whatever institution gives them the best ins -- the best execution in that region. erik: the optimist says that is what clients are telling them. the cynic says, a larger you are the more you get paid. stephanie: if you look at sales and trading business in the united states, it costs a ton of money to run that business. if you're not in the top five or top 10, what is the point? erik: i want to see if i can find what stuart gulliver gets paid. stephanie: forget about what he gets paid. what do you think a high-yield said -- erik: he gets paid 7.6 million

pounds a year. by the standard of a bank ceo is not that money. it is a lot in britain. stephanie: there are sales guys that get paid that much at boutique firms. you could pretend there are not but there are. what you need to have businesses where people -- if you are not generating that much business, why have it? erik: pride, perhaps. stephanie: forget your pride, save your money. blue apron's latest funding round put it to a multibillion-dollar valuation. i'm guessing they are not going to go out to dinner. ♪

vonnie: airlines were leading stocks lower today. it's like it will be the same thing today. headlines from american airlines singh benchmark revenue gain

higher than forecast. i'm going to check southwest as well out with headlines saying problems will have fallen about 6%. it is more than analysts were looking for so negative news out of the airlines. look for stocks to decline. southwest down about a quarter of percent -- a quarter of a percent. stephanie: blue apron, the meal kit delivery start up is cooking up something big. the company is announcing it has raised $135 million in new funding led by fidelity investments. how do they plan to put all that dough, get it, to work? matt salzberg is the founder in ceo. you told us the business model, we loved it. fidelity does too.

$135 million? if you like startups, instead of talking about profits, they say look what i just raised. what are you going to do with it and how we turn that into more? matt: we are just under three years old but the company has grown a lot since we started. we have hundreds of thousands of people all over the country cooking with us. the demand for what we do deliver recipes and the ingredients people need to cook is so huge. we are investing in our for film and infrastructure and our supply chain to allow us to get people fresher food at better prices. erik: by the way i applaud you for saying we are not a startup anymore. so many companies that have been around for 10 years the call themselves start ups as they think it confers some kind of innovation/disruption upon them. stephanie: and it gives them a break and they screw up. erik: congratulations.

matt: we are working with hundreds of firms all of the country. one of the fundamental components of our business model is to take waste out of the supply chain. on the consumer side, your portioning food so you're not throwing out food you're buying from the grocery store because you don't have the right amounts. since your subscription-based memberships, we are planning demand really well. we do not take inventory on perishable food. we are working so close with hundreds of farms and different family-run businesses to plan their production. erik: no inventory? matt: we have minimal inventory. erik: basically the toyota of food delivery business. matt: operation is important for us. one of our objectives is to get people fresher food at better prices to make home cooking available to everyone in this

country. stephanie: you sell the right quantities? how do you decide what the right quantity is? the right quantity for someone in new york is different. when you eat dinner in chicago, your plate is like flintstone style. matt: we have incredible chefs who are experienced in designing great meals. when i say around the right size, i mean around the recipes. when you go to a grocery store they are not designing operation around use. as we are designing and entire supply chain, we can do that all the way back to the farmer in a way that is more economically efficient. stephanie: is blue apron luxury? matt: absolutely not. we are trying to allow people to

create a luxury meal at home at prices that are accessible to everybody. our mission is to make incredible home cooking accessible to everyone in this country and we do that by making recipes easy and fun but also through our supply chain work and all this waste we are taking of the system so you can get better quality food from us than you can anywhere else. erik: are you profitable yet? matt: we are not profitable at the bottom line but the underlying economics of our business are strong. erik: when you hit your stride and get to the point where you have achieved the scale you are looking for how much money would you make on a typical meal? what are you modeling? matt: we are not disclosing unit economics of profitability but we are making money today on every meal we sell. stephanie: i guess what eric means -- in 1999, there were some businesses that as the end-user i thought they were

great, but at the end of the day the company's could not make money. how are you going to bounce the two -- balance the two? i'm going yes, but you have not reached a yes in terms of making money. matt: a lot of companies in the past and companies today that our delivery companies. the delivery business model is a complex business model and it is not extremely profitable. erik: you are logistics heavy. matt: we are a supply chain business. we are unlocking value in the entire grocery industry by reorganizing the way the supply chain is done. erik: how? matt: we are cutting out middlemen and because we have these direct relationships with consumers in a way that grocery store does not, grocery store does not know the end use of the product. stephanie: they do. now they are delivering.

matt: they do not know the dinner you are trying to get on the table. we are working with farmers to plan their production over the course of a season in a seasonal way and with market prices to help them utilize land better. we are able to reduce the cost and complexity of that. stephanie: eric in our producers will yell at me for asking. when you talk about the importance of supply chain, is it your dream to have amazon by you? matt: no. to be honest we are not looking to build a company to get acquired. we are trying to change the way that america cooks and eats. stephanie: unless you can make a ton of dough. matt: we are trying to do as well as we can but we are looking to build an independent institution and we care a lot about our mission. stephanie: if you end up selling to amazon i think i should get a commission because i think i just hit it. matt salzberg ceo and founder

of blue apron. erik: a bold call on all asset classes. ♪

erik: isn't that spectacular? san francisco, 5:54 in the morning pacific time. thousands of viewers tuning in to "market makers." it's time to give you insight into what is happening in the financial markets. julie hyman is taking a look at the analyst action this morning. julie: we have a big cross asset strategy call given the outlook for inflation. here is what it boils down to. some of the most important calls from the strategy note. they want to be long equity

volatility through the vix. the vicks has been very muted. european stock volatility has picked up. socgen thinks it is not going to stay that way. u.s. equities. what are some of the rationales behind these calls. they say inflation concerns are warming up. we will continue to see a fading u.s. dollar. i think that will be positive for commodities. they are also looking at liquidity issues we have been talking about behind some of what they are talking about particularly looking at the boone and -- the bund and u.s. equities. the chinese calls are about diversity. best about diversification.

-- about diversification. we will be talking about this throughout the day and parsing out some of the individual parts of that call. i wanted to get to a stock call that has to do with dollar general. two stock calls. dollar general was upgraded to strong by and initiated with liquori. the shares are up about 1.2%. raymond james saying the stores should see accelerated revenue growth and that should be positive for the stock. dollar general was left out of that family dollar, dollar tree deal. these calls are positive this morning on the business going forward. erik: lots of people like the idea that that stock can do well. thank you very much. julie hyman. when we come back, we are talking about tampa bay. the lightning beat the blackhawks in game three of the stanley cup finals. jeffrey vinik will be with us for the next hour to talk about

how to make the business out of hockey in the great state of florida. ♪

erik: good morning once again. it you're watching "market makers." stephanie: coming up, ge sells and stifel is buying. erik: the tampa bay lightning owner on the stanley cup and building a successful franchise in florida. his big development plans for tampa bay. jeff vinik will be with us. stephanie: the largest bank in

europe says it will cut thousands of jobs. it's a job aimed at restoring profits. they will eliminate as many as 25,000 jobs. that is 10% of the workforce. that blows my mind. they are trying to cut costs by $5 billion a year. they will sell the operations in turkey. >> brazil and turkey have limited value to the franchise and that's why we have made the announcements we have. 40% of them are in low markets. we will address that. i think the brazil in turkish transactions prove that there are no sacred cows. stephanie: he has announced 87,000 job cuts. he has also reduced the number of countries at the operate in.

greece has some problems. they have just submitted a new proposal to try to unlock the bailout money. this plan is getting the same reception as the others did. one international official told us it's just a rehash of old proposals and not at all credible. the german finance minister says that the ball is in greece's court and the country must decide if it wants to carry a difficult load. he said that germany would be unwilling to play a blame game with greece. erik: american airlines joins delta in saying the gauge will be lower than expected. revenue from the year will fall. i will cause investors concern. also, snoop dogg is suing for a share of the brand value of cult 45 malt liquor. he says his promotional deal entitles them to 10%. last year the brand was bought.

they would be happy to at least talk with him. those are your top headlines. stephanie: i think he is more than just a hip-hop star. he is a cultural icon. snoop? he has been around. 25 years? how'd you not love him? moving on it. someone almost as important is with us. stifil is buying another business. they are not slowing down anytime soon. they have agreed to buy barclays . here to discuss the deal and what the bank is eyeing next is the ceo. welcome. we never get you in the flesh. an outsider would say, hold on. a missouri bank organization buying barclays u.s. wealth

management unit? where'd you get all this dough in all this capability? ron: i love coming to new york. you think everything west of the huston doesn't line up with anything. we do have some money in the midwest. i promise. we have to go to the backyard and dig it up, but we have it. it's a great transaction. wealth management is a great business. it's a relationship and it's what we excel at. it's our core competency in that business. it's a great deal. erik: you're getting 180 brokers? that is very key. i understand your reticence. what is it going to take to keep these guys on board? ron: a good thought -- platform and a culture. it takes retention. people don't stay for money nor do they leave for money. stephanie: yes they do.

erik: 300% of the revenue generated if you're making $1 million a year in fees and commissions, you can get what? ron: by your math, 3 million. erik: you dared me to use the word rollout. ron: how do you roll up people? this is not a roll up. when we had 1200 people we had 6500 people. when you see these headlines about cutting and cutting. there are ferns that are picking that slack up. erik: your growth is remarkable. you go back 10 years ago, you had just a few more than 1000 employees. stephanie: when you hear about cutting 50,000 jobs, i try to

make the argument, why do they want to be in all these businesses? when you talk about what their headcount costs are in the u.s. they are massive. does it make for -- sense for an institution to have all these businesses? ron: it can be under regimes that existed precrisis. they built very big organizations. today you d risk. it mostly means cutting people. it's unfortunate. the businesses are too big. they were financed with leverage. when you have to replace leverage with equity, they don't earn their cast -- cost of capital anymore. erik: given that that is a true statement, why do a lift like the barclays deal? why not pick off the guys and women who are not happy any longer at merrill lynch?

even the morgan stanley's? morgan stanley has been doing better and so has ubs. those firms are still vulnerable. ron: we're doing that as well. we are not just a unique -- look , it's not shopping. i don't want to come off as it being shopping. we have a model that is the meritocracy, blob blob blob. stephanie: i wasn't going to hear that. erik: where do you want to grow your footprint? where'd you want to have more brokers? ron: everywhere. erik: in this market? ron: there is a ton of market share that we can grow into. i don't want it to sound like we want everyone. we want quality people and we want to continue to grow.

we just have 3000 and the largest firms have 15,000. this is not a numbers game. stephanie: help us understand where you can make money where others can't. we talked to traders out of morgan stanley or goldman sachs they can't take any positions and make money anymore. you were never in a position to take paid positions and you are making money. how does your formula work when those were saying no, if only we didn't have dodd-frank i would be crushing it? ron: i can't speak for other firms. our business model for years and years has been at we make money on giving advice. we do not make money on taking positions on our balance sheets. we don't. there is a big difference than what is happened. many firms make money by taking part-time -- proprietary positions. stephanie: is there really any

-- a hedge fund out there that in their missions ate met when they speak to their in vestments -- investors, is there really advice out there? ron: where do the ideas come from? it still people thinking and picking the right idea. do you think computers are doing this? do you think you can put something in a computer and it will spit up the answer? people do it. stephanie: i don't think he would say the great idea came from salesman. ron: i bet he would. in some cases. not in all cases but in some cases i bet he will. do you think we are floating around not creating value and somehow making money question mark --? erik: i like that you are doing. ron: we are growing. in there is a growth premium.

growth at a reasonable price. erik: where did that go out of fashion? stephanie: not in missouri. it is still in fashion in missouri. are you seeing sony people continue to say they don't be at a big institution because of the regulations? they are not getting paid at the end of the year because of the cost the big banks have? are they just saying mercy? i can't control my destiny here. ron: that's probably true in technology and across the board. media is the same thing. that is a growth market and of itself for people who want to give back to a smaller organization. we are still that organization. we are having a good time. erik: we are taking a big break. he will be back with us.

apple announces a bunch of new features across all of its products. these are product you might want to be buying. why this is your time to buy apple stock. ♪

erik: we are back with ron. your industry has lined up ferociously against the fiduciary standard. why? ron: first of all, the industry is behind a best interest standard. the fiduciary standard at the end of the day what it will do is significantly increase costs and reduce choice to the smallest investors. in our firm, fiduciary standard and the requirement for us to put these on our follis -- smallest accounts, over $100 million in revenue for the firm.

stephanie: i think we to explain what that is. erik: it's putting your clients interests first. you will say that's what you do every day. let's say let's just assume that your firm and the people that you work for do that. a lot of people don't and that's the problem. ron: you have to deal with those people. there are a lot of people that go to jail. the fiduciary standard at the base is a good idea. it's a best interest standard and nobody is going to argue with that. if you don't do it, you're out of business. you can't be in business 125 years without putting the client interest first. it's ridiculous to think that. erik: you can build a bucket shop on long island. you can take a lot of money and disappear and run off to wherever.

ron: that's not what we're talking about. rules can be broken. you can still do that. stephanie: we have a lot of long island viewers. ron: here is the thing. the difference is that applying it to small accounts is going to -- the results of this will be small investors forced to either leave the brokerage firms and some people think that's a good thing and i don't think it is. it will increase the costs significantly. you will have to put a fee on those accounts to take on the burden of the fiduciary standard. i think the concept is good. i think the devil is in the details and the devil in the details is almost unworkable. if it's workable small investors and people saving for retirement are going to be significantly hurt.

it raises revenue in our firm and i am arguing against it. stephanie: in any business you are going to have some bad apples. in education and in technology, you are always going to have that apples. erik: it's reason enough not to adopt it. stephanie: we have to break. we'll be back. it's time for commercial. ♪

erik: under the gear and another wwdc from apple. they introduced a new music streaming service. if you are an investor, you may have missed a golden opportunity. every year, apple stocks drops.

why isn't everybody buying apple with these underwhelming new announcements? at one point, they were down 1.4% yesterday. i went back to 2005 and every year, apple stock drops. is that the golden buying opportunity? dan: we see these reactions every year. when you look at the iphone 6 product cycle and china, we really believe they are on the precipice of seeing major growth opportunities for the second half into next year. some of the products they are announcing, like the watch and apple pay, in the streaming music, we think that's the tip of the iceberg. they will have streaming tv service. there will be a one-stop shop.

stephanie: we heard nothing about tv. dan: that was intentional. they are still ironing out some of those agreements with content with the broadcasters. there was thought that they were going to do that up until about three weeks ago. most expectations and even internally at apple that they could announce something. they could not get there from a timing perspective. now it is about later in the fall or early 2016. these streaming services are not moving the needle financially. it shows how they are heading from a software perspective and skating where the puck is going. they are putting a move around their eye to -- itunes franchise. ron: what did you think of apple music?

dan: i sort of view this, when you think about streaming music and you think about the competitors out there, at this point it's really more of a defensive move for apple. it speaks to that $3 billion beats acquisition. they needed to do this. a lot of consumers are going more to streaming. this is not something they could miss out on. it might be a little late. i think you're going to see a lot of adoption from consumers. it's the tip of the iceberg when we think about streaming. this is the appetizer. erik: we ran out of time. thank you for being here. he is in san francisco. we will right back after a short break. ♪

just because i'm away from my desk doesn't mean i'm not working. comcast business understands that. their wifi isn't just fast near the router. it's fast in the break room. fast in the conference room. fast in tom's office. fast in other tom's office. fast in the foyer [pronounced foy-yer] or is it foyer [pronounced foy-yay]? fast in the hallway. i feel like i've been here before. switch now and get the fastest wifi everywhere. comcast business. built for business. stephanie: welcome back to "market makers." i'm stephanie ruhle fit the commercial breaks are amazing. we are just a few minutes away from the opening bell. tracy is here also to jump in.

ron is guest anchoring with us. i am not going to be losing my job after this. this might be my last day. this could be the grand finale for me. what are the things we should be paying attention to? tracy: it has to be the weakness in at queen. we are seeing quite a bit of weakness in that market. it looks like european stocks are heading for their sixth day of losses. the emerging markets index is down for the 12th straight day. that is the longest losing streak in 24 years. we also have the institute of international finance with the biggest selloff. there are lots of moves going on. stephanie: you are yachting -- nodding yes and you are nodding

no. ron: europe is definitely trying to sell debt to the united states. guest: this is a preview of the fed. as interest rates go up countries become weaker in terms of their ability to service that debt. we are seeing a 4.4 billion out of those countries in africa and latin america over the past few months. emerging markets debt teams are moving very cautiously with all eyes on the fed because of it. erik: i have trouble with a lot of things. it's the trigger of these things. it's not a secret that the fed is going to raise rates. lots of markets have been reacting to that likelihood in advance of that. why the selloff now? 6 ivonnie: i think we are to

get close. there are talks about the weak gdp report. we may be pushing to 2016. wage inflation is here. tracy: number two, it's a big day for china. we had disappointing inflation numbers out of china. if that is adding some weakness to the stock market there. we have a major decision from msci about whether to include local chinese shares in some of their benchmark indices. if they do that will lead to some inflows into chinese stocks and we could see what some people say is a bubble get even a bigger. erik: any reason not to? ron: not long term. i think full employment is here. real growth in income has gone

nowhere. i think that is one of the real dilemmas. i don't see wage inflation. i run a business and i don't really see it. of course i am paying people. it's different than the 90's when people come in with raising wages. vonnie:guest: people had thought of the fed. what we are seeing in the last round of data is lowered skilled workers are starting to see some wage inflation. it's just learning to turn. we are not seeing it broadly across the board, but we are seeing the turn start and the fed wants to get ahead of that. ron: the issue will be people think the fed is going to raise rates and they are. the dollar is going to strengthen and when it does, run that across the globe. that is why you are seeing weakness and emerging markets.

tracy: i am happy that you are thrilled to talk about wage inflation. number three is signs of a coverage. there was a small business optimism survey out today. it showed the rise of 1.7 points. small businesses are optimistic about their capital expenditure plans. we have one of janet yellen's favorite indicators out today. all eyes will be on that. stephanie: we've got a get to julie hyman. absolutely we do. we need a quick look at the stocks on the move. just moments ago we saw the bell being wrong. the u.s. army is down there today. julie hyman is here. what's moving? julie: we have seen a downtrend in recent days. today we are looking the clients out of the gate.

right now there is a little change. lululemon, this is a favorite of stephanie's. the profit doubled. the ceo continues to lead a turnaround at lululemon and it is bearing fruit. we are watching the automakers once again. they are not giving up on the quest to try and consolidate within the auto industry. he has been contacting hedge franz -- hedge funds to persuade general motors to do some sort of the deal. we are seeing a fiat with little change. gm is up 6/10 of 1%. speaking of something else, airlines are in focus once again. american airlines is down 2%. it is the latest airline to come out and cut its work -- forecast for measure of revenue. it's now looking for a drop of

six to 8%. it had been a drop of fort to 6%. -- four to 6%. stephanie: thank you for giving us the latest. what you must focus on? guest: the fed as is everyone else. we have a great amount of data coming up. we are looking at wage inflation and the gdp for quarter one being a temporary downturn. there is a consumer sentiment being very high and we see that strengthen in auto sales which gives us the confidence that the recovery is stronger than the quarter one report indicates. ron: it's pretty well signaled that you will see a rate hike sometime this year. i'm not convinced its september. that's not the question. we will see a rate hike because we have to get off 0% interest

rates. i think that the question is the next series. what happens after? we are going to have a rate hike and we have to get off zero. in the messaging about the slope of rate hikes, it's going to be extremely important and that will have more to do with the future of markets and the next rate hike. guest: we are pricing at two thirds of a rate hike in september. the market has been messaged through yellen. she says it will be gradual and she doesn't want to spook the markets and have the outflow that you mentioned. erik: the analogy that people like to use it to put bullets back in the chamber. what is the bullet? is 25 basis points and of all the bullet? is it enough of a bullet, does the fed need more than two or

three rate hikes in the event of recession? guest: are you going to notice when the rate on your checking account goes from zero to .25%? erik: it's not a bullet then. guest: people are not going to notice that much. i think there need to be more steps. it needs to be gradual. at the same time, i don't think it gives them a ton of ammunition. ron: the we have had this long -- policy as long as we have looked for the recovery. we have been looking for this recovery since 2010. we have not had four consecutive quarters where gdp has been 3%. erik: consumer confidence is coming back as we discussed. ron: from what? erik: it's close to 100 now. i'm just looking at this chart.

long-term going back to 1990, 100 is more or less the long-term average. small business feels good enough about the prospects for this economy. what's not to like about the future? where we are six or 12 months from now? ron: i love the future. i just bought businesses. i would like to see gdp growth. we are leaving trillions of dollars of economic growth for error children on the table through policy and other things because we cannot get back to the 2000 73% gdp growth. stephanie: what we need to pay attention to is the fact that people are less productive than they need to be. more people are getting jobs. the output is not where it needs to be. he thinks that's the reason we need to hold off on raising rates until 2016. guest: i think what is more

concerning to me is that people look at the labor force participation rate and say that is still a little bit off. people need to get back into the workforce and we are not seen the full force of what happens when people try to find jobs. when you look at people who have left the industry with their jobs, two thirds of those left for purposes of retirement or disability. only one third is coming from people who are actively seeking work. that argues that you will have some wage inflation. there are less workers to fill jobs. that is our optimism, that we will get a little bit of wage inflation. not three or 4%. we are coming in across the board. that is really a point of optimism for us to see those converge. erik: it was great to have maggot with us. she is with jpmorgan.

-- it was great to have maggot with us. eg with us. we are sticking around to talk about the bolts next. stephanie: when you think hockey, you think florida. ♪

stephanie: general electric is trimming the fat. they agreed to sell a lending business for $12 billion. ge could use that cash to fund more takeovers. ron is the ceo and he is still

with us. guest: this is the next big chunk of capital to go after they did the real estate transaction with blackstone and wells fargo. it's a big deal. it's not small. the end goal of this as they are going to have a lot more cash at the end of the day. they've got a lot more assets to sell. erik: they are kind get rid of $200 billion? now they have gotten rid of close to 40 billion. they've got a lot more to go. guest: there is a lot more cash coming in. they are going to spend that on buybacks and dividends. some of that could go to acquisitions. erik: they are trying to shed the designation. given the conversation that we were having about global growth and american growth, is there enough out there for the

industrial business that ge wants to become again question mark? ron: you can't lose track of how much money they made in that business. there are a lot of people who are looking at the designation and that's probably not conducive to business development. stephanie: what could they have their eye on? what could be the target? guest: what you get rid of ge capital, you are going to have a very capital intensive and slow going industrial company. one industry is life sciences. phillips is moving more in that area. that is something that ge could get bigger in as well. there are laboratories that have been thrown out there. you could look more at core industrial names.

rockwell collins has been mentioned as a possibility. you can look at the pump and valve's. s. ron: or we could get world growth going so well that we need a lot more cars. stephanie: thank you so much for the latest on ge. erik: the tampa bay lightning take the lead in the stanley cup finals. they took a two games to one lead. the owner jeff vinik who is trying to build an empire in tampa is with us. jeff, you've got to be pleased with game three. you are still a ways to go before you take the cup back to florida. let's talk about what you're trying to do in florida. one of your friends, i can't disclose who he says the big question is how you make money in hockey in south florida?

the estimates are the your team is losing $20 million a year. does winning the cup solve that problem? jeff: winning the cup helps financially. you're not going to have that happen every year. when we look to our finances down in tampa bay, my formula for success there is breaking even and having a great team every year and being able to compete for the stanley cup and making a big impact on the community. by the way, we make no apologies for being in tampa bay. hockey is the greatest sport there is with great athletes and a fast pace in close games. hockey can thrive anywhere. we have talked about that we want to be the green bay packers of the nhl. there is no reason why we cannot accomplish that in the world's best sport. it's going to succeed in tampa bay and other places. stephanie: to flourish in flight hockey?

jeff: doesn't like hockey? some of them did not grow up with it, but as they learn the sport, as they learn about our players they love hockey. our tv ratings in our area are triple what they have ever been before. people are learning the sport in figuring it out. the same could be true in south florida and in phoenix and st. louis and nashville and dallas. it's a great sport and it takes time. erik: i love hockey. i am from toronto. don't you have to work harder in a place like tampa bay to make a success of your team and bring the fans in? take the lease for example -- leafs for example. they have been among the losing this teams. it's a constant source of heartache and the value of the club has risen to $1.3 billion on the back of nothing. they never make the playoffs.

they did not again this year. jeff: valuation you can't always believe those numbers. more importantly, i do think it's fair that we have to work harder. we have to dig deep into the community and we have to give our fans a great experience and do everything to an outstanding level. the sport is terrific. the athletes are terrific. it can succeed in all climates. erik: we have a st. louis blues fan with us. ron is the ceo of stifil financial. ron: hd tv has really helped hockey. you can see the puck on tv now. i think -- people going to the stadium is not what's wrong. it's the contracts for tv. i think hockey is on an upswing.

if you're going to buy a sports growth trajectory, i think hockey is one to look at. stephanie: do the players need to be wearing go pros to give us the experience? jeff: in the all-star game, a couple of players were that and the referee did. i would say that the sport can do very well in all of these areas. it's educating the youth. we are going to come out with a big youth hockey program in the next few months and get the whole community engaged. stephanie: how expensive is that going to be and how much time are you going to give it for florida to fall in love? jeff: it's an investment and i look long-term. we want to win the stanley cup this year and we went to compete for every year. we are making an investment in our region and it costs a few dollars. as people get engaged with the team and kids do and they get older and they have kids, it

will build on itself over time. erik: go pros are here and they're coming to the league. what about advertising on hockey sweaters? how long before it looks like a soccer pitch? jeff: we have the greatest sweaters in all of sports. before anything like that happens, the league will be very careful and evaluated in great detail to make sure that it makes sense. stephanie: jeff, thank you so much for joining us and good look. erik: he is staying with us. he is going to talk about how to build a business in florida. he is going to talk about real estate as well. stephanie: we are going to be back in just a few. you are watching "market makers." ♪

erik: we are back now with tampa bay lightning owner jeff vinik.

thank you for staying with us. you're up public market guy. you then ran a hedge fund or did now you are in tampa bay and the owner of the lightning. you are part owner of the boston red sox. all of a sudden, you are about real estate. how'd you make that transition? why tampa bay? jeff: i am a lucky guy. i got to reinvent myself and do interesting things with interesting people. most important thing if you are in the money business or sports or real estate it really comes down to having great people. maybe i am an expert in hedge funds and running money. in hockey, i am not an expert and i am not a real estate expert. i surround myself with the best people and hire the best advisors. we think we have a very exciting opportunity in tampa. we have 40 acres of land

downtown surrounded by water on three sides. we have a blank canvas like anywhere else in the country. we think it's going to be a great location for corporations to move into and for retail and residents and up to 2000 units of residential. stephanie: couldn't you make the argument that you got a blank canvas for a reason? if it was so valuable wouldn't some have done it already? jeff: it's a great opportunity. i don't think so. the arena was put here about 20 years ago. the convention center and the aquarium they were put here with the idea of developing all of this real estate. there was never any one owner for all of the land. there was a downturn in the mid to thousands. those two factors made it difficult to develop. now we have such a supportive legislature.

the county legislatures one owner of all of this land with cascade investments, that sets this up with the ability to really create a great environment. i know that tickle shaye, but it's true with what we are trying to create. erik: you've got something big happening down there in tampa bay. we have to wish you luck in the stanley cup finals. jeff vinik is the owner of the tampa bay lightning. stephanie: ron, i think you are focused on a basketball. who is going to take it? ron: i think that the way lebron is playing, if you were going to make me go down, i will predict the cavs. erik: big money. stephanie: i am not going to be

mitt romney and that $10,000. when this guy goes on vacation, ron is coming in. erik: everything just went out the window. stephanie: what a pleasure. our guest anchor, tomorrow is going to be pretty good. we will have the ceo of media links on big names in advertising. -- we will have the ceo of media links and get his take on big names in advertising. ♪

you are watching bloomberg market they. erik: president obama's a on

russia are working. the ukrainian government says it still under attack. we will talk about options. julie: they are trying to get you to buy more coffee. olivia: good morning. erik: it's 10:00. julie hyman has more for us. julie: we have the highest inventories in a year. for the month of march, we saw -- these are backward looking numbers. for march, we saw the number of buyers up.