another president may be impeached. micros systems a talk about that big acquisition and a whole lot more. it is a bloomberg exclusive. ♪ welcome to the second hour of "bloomberg ." >> i am from michigan, flint. stephanie: i have to talk about the last hour. i have to talk about paul ryan for a moment. the sentiment about paul ryan, and i am not just saying this because i am a woman and a mother, but i need to know that i can spend more time with my family, saying that his massive. it is bigger than all of these

initiatives and campaigns. that is someone saying this is what matters. this is what i need in my life. so true in business that the urgent drives out the important. when i took way from that is he that it is urgent but not as important as his kids because he may have other opportunities. i really respect the fact that he was going to say this is maybe not the most important thing in my life right now. thatanie: i like the point maybe if more of his political leaders were moving their maybees to washington they could learn to be cordial and work together. david: sounds nice. stephanie: i am really nice to people at cocktail parties. coming up in this hour, we have

and its was of interview with the dell ceo. emily chang will be sitting down with him coming up in 45 minutes. vonnie: it is a record year firm mergers and acquisitions and i got a lot bigger this morning. western digital has agreed to a $19 billion acquisition. separately, lab research is buying kla. both of those companies based in telephone california. syria's president met with the wretched president vladimir putin in moscow. it is the first known for a trip since serious civil war started in 2011. because without russian military help, terrorists would have

taken more territory under the control. the head of the european commission is calling an emergency meeting on the refugee crisis. the surge of migrants is deepening in the balkans. leaders will meet in brussels. slovenia is requested for help to cope with the refugees. border posts are overwhelmed, they say. that is what unit to know for the moment. stephanie: a quick look at the futures market. less than 90 minutes until the open. i like to start our way that we try to bounce back after yesterday's down day. investors are moving to earnings for clues on the strength of the economy and they will get it y results s&p compan today. how about twitter? investors are getting sharecial with

this morning after the stock was undercut. there is a reason why he would go negative on a company. people are saying there's no way jack dorsey could be ceo of twitter and square. look at jamie dimon. look at ceos of conglomerates out there. twitter and square are significantly smaller than many fortune 500 companies that have lots of articles that have nothing to do with one another. david: it is an exceptional problem more than a management problem. stephanie: twitter has problems, by the problem is that jack cannot handle both verticals. david: let's go back to general motors. we broke the news on their record third-quarter earnings this morning. we now go to matt miller who has the cfo. matt: i am talking to chuck stevens right now, chief financial officer at general motors joining us from the joint. let me ask you about the margins. 11.8%.

that is better than the 10% you were shooting for next year. you have already be in the incredible north american margin. can you keep that up as you continue to overhaul the future on huge productis line? chuck: we reached our objective in advance and we plan to maintain that. we continue to drive on efficiency in the business and we are hammering the heart of our lifecycle. it will fundamentally change the entire passenger car and crossover portfolio over the next couple of years. we are confident we will be able to maintain the kind of performance we have seen in 2015. oft: trucks are a huge part your $38.8 billion sales. americans want them. gas prices are low. it enables us as well as financing.

when you revamp your product line, do you think about a day when got prices to be higher or financing costs go up? chuck: sure. today, we are seizing the opportunity being presented by the market, but long-term, we are driving our earnings and business so that we have quality of earnings across our portfolio. that is why it is important when you think about the next generation cruise or malibu or crossovers to understand that these will be more profitable than the ones they replace because someday we will back to more normalized gas prices and the truck market will not be as robust as it is now. the way to continue to drive to present margins is quality of earnings across the portfolio and intense focus on cost. matt: gas prices are a huge tailwind for you as our loan financing costs. how much of a headwind is the strong dollar for general motors operating in markets around the world? chuck: clearly on a

year-over-year basis, we have experienced headwinds from a foreign exchange standpoint. you have seen it in the revenue number. our revenue was down primarily because of her in exchange -- because of foreign exchange. we have enables offset that by pricing aggressively in the markets were we can offset the effects. it is not stopping this from achieving our objective, which is to have year-over-year profit improvement and margin improvement and generating more than $10 billion of profit and a company level in 2015. matt: you would have had $2.3 billion more had it not been for the strong dollar versus other currency. talk to me about the situation in china. they went through a devaluation in the quarter but your margin there are up 9.8% from 9.6% in the previous quarter. chuck: as we said after our second-quarter earnings, we had

been monitoring and expecting the industry in china to moderate. with a very proactive actions starting earlier this year to drive out cost efficiency. the results prove themselves with our third-quarter results. we haven't had a billion dollars of equity income. 9.8% income margins. 1.5 billion today and we will continue to execute on the plans we talked about in the utter. matt: let me put you on the spot. i'm about to go to the new york stock exchange and wrangle sergio marchionne for an interview. he plans to push ahead with this idea that fiat chrysler should combine with gm. how do you think that would work financially? what kind of since the think that would make for you? chuck: management's view

unanimously is it will not work. our focus is on executing our plan to drive the best outcome and most shareholder value for our shareowners today. to underwrite an unprecedented level of risk from integration and a cost perspective is not in the best interest of our shareholders. we are focused on executing our plan which will drive the most shareholder value. matt: i appreciate your candor. general motors blows away earnings estimates $1.50 a share versus $1.15. ceo of a next, the company weighs in on the real estate market and beyond.

i think we will get to 1.2%.

however, before just believing, i must say that i will do everything to achieve 1.2%. i will do my utmost, but it is not just a matter of believing. it is a matter of political action. stephanie: that of course was brazil's president speaking with bloomberg editor back in april. impeachment papers are expected to be filed against her sometime today. she is accused of manipulating accounts. we are joined now from são paulo i believe a -- by fully philipe. unless this different? the threat of this sounds enormous. we don't know what it is like in brazil. >> this is a very interesting situation right now. there have been dozens of similar filings so far.

this is very significant because two of the writers of this filing at this moment, one of them is a prominent former , soer of the workers party it is basically -- he was one of the founders of the party and is a very influent name in brazil's public opinion. the other is miguel real junior. he is a former justice minister and a very respected and well-known name here in brazil. aty are also being backed this moment by the biggest opposition party in brazil. it is a situation in which you find info and names within brazil's public opinion. one of them was a supporter of the workers party. but of them are claiming

dilma rousseff and hair administration did not fulfill all of the fiscal rules they were supposed to last year and this year. stephanie: thank you so much for joining us this morning. from brazil's abu dhabi, our next guest has his pulse on the real estate market. joining us now is jeff blau. university of michigan alumni like david westin. david: go blue. stephanie: except last weekend. jeff blau: they found a new way to lose. i have never seen anything like it. david: the last play of the game botching a punt. stephanie: tell us what you are seeing in a would noabu dhabi. we kind of study the trends around the world and having one of our partners from there, they suggested we take

a look at what is happened and it is amazing the growth that has happened in the region. our partner is one of the sovereign wealth funds there. they started a project that would relocate the stock exchange and build four office towers and a four seasons hotel. they asked us to come in to bring our expertise to help them develop and curing the retail component. today, we are building over 2 million square feet of retail, restaurants between the four seasons and the rosewood hotel. we announced a first ever macy's and bloomingdale's in the region. it is incredible the buying power that is there. the average person in the u.s. spends 45 minutes in a mall. the average person in the region there spends four hours. those trends are what attracted macy's and bloomingdale's. stephanie: hours? david: this was featured and they mention how excited they

are about this. jeff blau: it is the extra three hours and 15 minutes they are excited about. stephanie: everyone is warning us about the global economy slowing down and how everyone is spending less. we see it with companies like burberry and china sales down. why is this a different picture? jeff blau: what you are talking about is here. this is not only the 1% we are building for. when you have 2 million square feet, you are across all economic sectors in terms of categories of retailers. if you look at the amount of retail square foot per person in the region and buying power in the region, it is far less than here. david: there are people coming in. jeff blau: coming in from the region. dubai is a large tourist place where people go. dhabi is a be -- abu

40 minute drive. people are coming to the region. stephanie: take us to london where people say that real estate market is belo bulletpro. jeff blau: i would view london like new york in terms of the real estate market. we were attracted to london early because of that fact. the most interesting thing about london, they had a housing shortage in london. here, we focus on affordable housing. it is always in the press and we are talking about it. there, they talk about a shortage of units, a shortage of residential housing. the government mandates are a little different than here. it is just to produce housing because there's not enough places for people to live. what you also see there is a very immature rental market. institutional owner market. what you see is it is a mostly owned market and you have a lot of individuals that rent out their own units.

we created a brand where we focused on creating the best rental experience that can exist. our product is very attractive to investors. that product does not exist in london. our goal is to bring it there. david: please stay with us. we are talking real estate with jeff blau. take a look at a live shot this morning of -- stephanie: new york city. all of new york city. david: coming up on "bloomberg ." oil prices find to avoid a third day of losses after closing low yesterday. this ahead of an expected increase in crude inventories and a meeting by some of the top world crude producers. joining me is scott bauer.

he joins us from the cme in chicago. joininthanks for joining us. this trend is down here. will be rally back up today? >> i will say we will buck that trend. will get the data that will show a build. we saw that yesterday but there is too much geopolitical risk out there right now, and i think there will be a lot of short covering from the people that have been shorted at 50 plus. i think the 45 level, even though we will see that build later today, will be a short-term support area here. i don't know that we will rally all the way back up to 50, but i think this range of 45 to 50 is fair. the geopolitical risk is great to see oil fall much further. matt: if you look out midterm,

longer-term, is there a geopolitical risk outweighing the incredible oversupply we are facing? scott: probably not. oil go with the oversupply in the height of the oversupply? it barely reached the 40 mark.that is why i think or i-5 is a fair level. may be over the next two or three months we see it dripped into 42 or 43 territory. matt: when is this cycle turnaround --when does this cycle turnaround? these things take time but you see producers shutting down and rig counts dropping. ene does it hit bottom? -- wh does it hit bottom? scott: if you take the opposite look at it, one of the worst happens, when we see the shutdowns and the rig counts going down, that usually signals. that accelerates.

matt: do we keep enough volatility to make it with their while to trade this? scott: for right now yes, but we are seeing volatility wayne a little bit. it is definitely still worthwhile to trade. we have 45-50. i think it will more likely be 43-48 or so. still right now it is a decent trade. matt: thanks very much. more "bloomberg " next. ♪ david: welcome back to "bloomberg ." let's get back to good old nyc. the hudson yards largest private development? is that correct? jeff blau: with control about 28 acres of land on the west side of manhattan.

and $25 million development when it is all said and done. office, retail, residential, schools,ome up are -- parks. coach is our anchor for the first tower. they will move in march of next year. stephanie: those who were warning us saying danger ahead, we are heading to volatile times, we could be facing massive bubbles, for you, your bed is made. jeff blau: you have to recognize that we will go through some cycles between the beginning and the end. you have to set yourself up for that whether it is financial structure, capital structure, leasing. i am sure karl is right and we will go through some downturn between now and the time we are finished with hudson yards, but we built in possibility to stay through the. david: and you have some big partners. jeff blau: ontario municipal pension fund is our partner. lots of institutional investors

on a building by building basis. david: how much do you have committed? time warner is moving in. back with we bought gic and abu dhabi's idea. we will lease that space when they move out. time warner is committed to 1.6 million square feet to anchor the building at hudson yards. stephanie: in terms of commercial real estate, capital flow means a lot to you. as we face a possible rate hike, what will that mean? the value of debt will change. jeff blau: one of the most interesting things when you talk about all the places around the world, will we have seen happening in new york is something we have never seen before. the capital inflows from new york --to new york are greater than they have ever been.

we have over the course of the past two years, obviously with a project like hudson yards we are an attractive investment, but it is more than that. david: the you see that easing at all? jeff blau: no. the more instability that happens outside of the u.s., the more attractive the united states comes from a capital flow perspective. as difficult as we might see times here, or a political environment we have here, we are better than the rest of the world. stephanie: uber luxury building. is this building fully sold? the price blows your mind. jeff blau: we just launched sales right on the highline. starteddid when we hudson yards is require as much land around as possible because we saw the halo effect at the time warner center and we wanted to control as much around as we can.

we wanted to do something spectacular in advance of hudson yards so we can show the market how special a big plays it is going to be and how great architecture and design is. we started sales two weeks ago. property values seem to be quite high, but valuation is not. are you in the market? jeff blau: we do have a funds management business. we have gone through this before with some of the public companies and they think there is some is pricing in the market today between asset pricing and repricing. it would not surprise me to see some big transactions. stephanie: stay with us. we have more "bloomberg ." we are talking the internet killing cable. ♪ buddy- nice place, nice car what happened?

well, it all started with my free credit score from credit sesame.com. they gave me so much more than a free credit score. credit sesame's money management tools and personalized offers saved me tons of money and helped me reach my goals. i just signed up with their free app. what's my credit score? your credit score is 650. that's magic! no, that's credit sesame.com you get so much more than a free credit score so do more with your score at credit sesame.com david: welcome back to "bloomberg ." stephanie: guess who this guy is. we are still here with jeff blau

, the ceo of related companies. we have a lot going on. an exclusive interview with duff's ceo and chairman peter emily chang will be sitting down 's ceo and chairman. emily chang will be sitting down with him. li group of high-powered awyers set to begin the proceedings.

>> higher jetliner deliveries during the quarter. bearingmliner costs less than projected. that project has been a big source of costs for the company. the fact that costs are coming down would be good news for boeing and the shares are trading higher by 2.75%. , their earnings beat.

analystthe average forecast. the company is doing a big restructuring as well. allocating less toward its experimental medications. news.ors like that general motors also beating estimates. $1.50 a share in earnings. those shares also hire. stephanie: we hear what key banks are looking at today. jason joins us now from their new york headquarters. -- and tooking in how the internet is changing the media business. what are the top three threats? >> you have been flowing into the system can also will flow to

the web. you have profit margins coming under pressure from the pay-tv distributors. they are beginning to drop cable networks outright. there's only three distinct pressures. stephanie: we sat down days ago with less moonves who says this is understated. people are watching more content than never. those networks offering multiple platforms, that is more dollars in the door. cbs is in a unique situation in that they are not a cable network. they are a broadcaster. it's not overstated. a lot of the cable networks don't have the luxury or flexibility to put their content online. and earn the same amount of money. if you go through that analysis, you will find most companies 20-50% ifill fall they put their cable network and charge ane

profit maximizing price. that's why the incumbents are seeming incapable of competing with these new internet companies like netflix. stephanie: when we talk about what's bulletproof, you've been saying live events, sports, no one can touch them. espn will be having cuts? what does that say? sports aren't as super as we thought? jason: life events and sports are the most durable parts of the value chain. when people are court cutting, technical adjustments are made to make up for that. is thel durable part last mile internet providers. through four potential rival technologies. all of them fall short.

fixed wireless falls short. using your mobile device. . -- falls short. stephanie: thank you for joining us for this morning's meeting. thank you very much, stephanie. we are back with jeff blau from related. they have real estate assets valued at $20 billion. we talked about abu dhabi, london, new york, let's talk about the rest of the united states. where do you see the most promising possibilities for real estate? jeff blau: we do follow the large urban markets and job growth. real estate is a byproduct of economic growth and jobs. san francisco is a strong market. we are doing fiber six different

development in san francisco today. -- five or six different development since emphasis go today. rentss evidence of why are rising, people want to live in san francisco. herenies are relocating because that's where the talent is. --phanie: you have no fear these techons of eas companies are through the roof. all they are doing is raising money. this that factor into your decision-making? jeff blau: it does. you think hard about that. that's not all the companies in san francisco. there's true demand for jobs and job growth they're and that's what we track. there.growth david: we had an analyst on

earlier this week who had some disturbing numbers, percentage of lower income people's income being given over to rental and it is growing. jeff blau: the percentage of income being spent on housing -- not just rental. housing in general, becoming higher and higher. that's one of the policy issues in the country that we are facing. in terms of the market demand in those cities and the product we focus on, it's very strong. julie: i've been looking at wheat stocks and they -- how they've been doing. yesterday exploding. you can see the clear outperformance here, regular other reads. orange.500 in

you see apartments do much better. when you are looking at these urban areas, apartments versus office properties come on curious what can a been a mix you are seeing. we know multifamily housing is exploding. jeff blau: there is a strong belief in the investor side that the future growth in the united homes is a bit away from ownership and more towards multifamily housing. if you talk to people in the millennial generation, that desire to own the home is not there anymore. an investor perspective, we've seen a lot of capital flows into the multifamily sector. if you go into the markets where there are shortages, new york and san francisco, you see the supply demand pushing rents up. stephanie: what is worrying you? what stinks in your world

besides your football team? david: our football team has been doing just fine. jeff blau: we all have to worry about about overheating in the united states. you have to choose the markets -- we don't view real estate as a macro. it's very micro and local. we focused on the areas and opportunities we see that can be the most profitable. we are in for a bit of a downturn across the united states. we have to be careful. our investing has to be flexible enough to whether those things. to weather those things. we have two different markets. the high-end, 50 seven st these tall towers. that is a very speculative market and a market we stayed away from. our focus has always been the very high end domestic buyer.

new yorkers people across the net states -- if you look at who is buying a 50 seven st, it's not a lot of new yorkers. affordable housing is the backbone of our company. we are one of the largest affordable housing owners and developers in the net states. -- in the united states. important that you focus on affordable housing, not just high-end. --s good for the committees for the communities. it's the right thing to do. related has been a valuable partner in yonkers. stephanie: jeff blau of related. i wish i bought up new york city real estate in 1985. he did. today is back to the future day.

dayber 21, 2015 was the that talk and marty mcfly -- doc and marty mcfly traveled to. athill valley, california 4:29 p.m. on wednesday, october 21, 2015. >> 2015? you mean we are in the future. stephanie: lots of companies taking this as a branding opportunity. getting into the spirit. lyft teaming to pick up new yorkers in the signature the lori and. -- delorean. pepsi releasing pepsi perfect, beverage party drinks in the film. -- marty strings in the film. the original bloomberg terminal. how about that outfit?

in 1985 business suit. the chicago cubs win the world series commanding a 100 year drought. looks like that is a long shot. it is amazing -- there we have it. the chicago cubs in the mix. jeff blau, what did you think of that look? jeff blau: great. stephanie: congratulations. next time we see you, we need to do the show from hudson yards. jeff blau: i agree. we've got cuba and hudson yards. stephanie: nike has the innovation lab. you can back out. -- can't back out. our interview with

michael dell, we will bring it to you live. that's 11:00 a.m. on bloomberg tv. ♪

stephanie: you are watching "bloomberg ." return to an exclusive interview with dell's ceo and chairman, michael dell. emily chang is with us live from downtown austin, texas at the round rock company annual conference. you so much. thank you for joining us today. great to have you. an honor to be here at dell world. you just agree to the biggest deal in tech history. big tex deals have a history of going horribly wrong. why won't history repeat itself here? michael: we have to highly

complementry companies. we've become a leader in the current domains of i.t., today's i.t., servers, storage. we are extremely well-positioned nit of tomorrow. of tomorrow. infrastructure, software defined data centers, hybrid clouds, security, mobile. this is a powerful combination. we bring together highly couple emctor -- complementry -- cmc is well known. dell has reach across businesses of all sizes around the globe. some say it is just a commodity -- michael: it's a lot about software. one of the key aspects come if i look at our resource and

development innovation, emc's innovation, it has been much more software development over the last five or 10 years. hardware plays a role. when you build these ultra-powerful infrastructure systems, there is an enormous amount of software. fromo that the software dcetal, rsa, virtue stream, , we believe this a dream combination. italy: people out there say this deal is doomed -- emily: people out there say this deal is doomed. compaq hp took carly fiorina down. you have to be thinking about that. we spent about a year working on this. looked at it every which way. an confident we are building

incredible company. first of all, you have a whole different dynamic as compared with the other big transactions. one obvious difference is those other transactions, there were not principles. i'm all in on this. the level of overlap between the companies is quite minimal. this is not so much about combining existing businesses, there's a piece of that in those bit together very well, but it's also very much about how we address the challenges and opportunities our customers have in the future. including things like security. emily: you are taking on $50 billion in debt to do this. how quickly will you pay that off? michael: what you will see is in the first 18-24 months, a pretty

rapid deleveraging as we go through our process. godid this in the first dell private. a two notch upgrade from the rating agencies. we are determined to take these steps necessary with revenue synergies, some cost synergies to ensure this company operates with investment-grade policies. emily: what if the fed raises rates? you?uch did that concern michael: that is something you put in your model. emily: you are assuming the fed will raise rates? you can figure that out. that is not a big driver here in terms of what the fed does within some margin of outcomes.

hp is weeks away from splitting up. what do you think of their strategy? michael: this is a business where scale metal -- scale matters. we've seen the power of scale. if you think about what goes into the data center, its microprocessors, memory and storage. those are the main ingredients. those are the same ingredients that you find in client systems. in the internet of things, this explosion in devices. i think the scale matters. at the point where there is this explosion in the number of devices, the connection between all of those notes and the data

center becomes even more important. emily: they are saying they are doing this to become more nimble. michael: we will see how it plays out. as part of this, we are taking emc private. they will have the benefits we've had as a private company to not focus on the next 90 days as much as the next three years, five years and 10 years. emily: make whitman came out and wrote in a memo to her staff that she thinks you are the one making a mistake. you will spend $2.5 billion in interest alone. that's $2.5 billion they will allocate away from r&d and other business-critical activities which will keep them from better serving their customers. ishael: that $2.5 billion tax-deductible.

i think you know how these transactions work. hp itself last year spent more than $4.5 billion on dividends and a purchase. if hp were to go private, it about $2.5 billion -- that it could reinvest in r&d . her argument is ridiculous. if one goes and does the math and compares what companies are spending today on share repurchase and dividends compared to the costs we are financing in this go private transaction, i feel very comfortable. even more so on a tax adjusted basis.

emily: if hp is spinning off its pc business and they are the ones making the mistake, what happens to those assets? michael: that is a better question for them. emily: they are spinning off their pc business people -- business. ibm did it. you are doubling down. who will be on the bright side of history here? are --: look, there emily: you say you we will keep making pcs. michael: 300 million pcs sold each year. they are changing form. pcs embedded in all kinds of intelligent machines. there are virtual pcs and gaming pcs. for the last 11 quarters in a row, we've gained share in the pc sector. actual workk at how

is done, how productivity occurs , i'm a bloomberg user, it's really hard to get all the power of a bloomberg from a mobile phone. even though you have a nice mobile app, i love accessing bloomberg on to dell 30 inch screens -- two dell 30 inch screens. the same is true for all knowledge workers around the world. it's not about this device replacing that device. we have multiple devices now. you might have 3, 4, 10 devices. you go to this world of billions , tens of billions, hundreds of billions of devices, those devices are generating enormous amounts of data. businesses will be defined by how they can turn that data into real-time insights that allow them to succeed. emily: what will your role in

the future of the pc market be? michael: we will keep getting share. we will keep consolidating. if it goes down a bit in terms of the overall industry, goes up a little bit, that's fine. we will keep consolidating share, serving our customers, growing around the world. we are more commercial focus. we tend to work with businesses. we have a growing consumer business. our xps line, 12,000 l exclusive stores in china -- dell exclusive stores in china. in india, 10% of homes have a pc. compared to 35% in china, 67% in malaysia and 90% in the united states. when i look at any country in the world as its gdp advances a little bit from 1000 per capita the amount of0,

technology that gets consumed by governments, banks, energy, retail, consumers just skyrockets. if you were to be in the modern age, you need technology. an: will we see dell making mobile phones? michael: no plans. emily: why not? michael: this has been a very difficult sector. one of our competitors got in there is one company that does really well in mobile phones and a whole bunch of companies that don't. emily: you must be talking about apple. michael: we don't plan on getting in the mobile phone business. and likely to this company private two years ago. emily: you took this company private years ago. is there anything you miss about

being a public company? michael: no. and legal and why not -- emily: why not? michael: there is speed and agility we can operate in. we do inside dealt with our customers come a survey called net promoters. highestes are at the they've ever been in company history. we do an employee survey across all of our 100,000 team members in the country. those scores are at the highest levels ever. in the 15 years we've been doing this. when you line up the investments we are making in innovation and r&d with our leadership and ownership and they are completely aligned and there are

no disgruntled activist shareholders telling the company what to do, it's extremely powerful. our people are very energized, we are growing and investing. emily: what do you think of the carl icahns of the world? michael: there is a role to play for activists and investing. canhing taken to an extreme be a bad thing. i don't have a particular fondness for carl icahn. and legal and you do have investors and they got on board for a reason. -- emily: what do you think their timeline is for an exit? what you know about their strategic plans? michael: there are lots of ways to deal with that. when the time comes. i'm not too worried about that. emily: you cannot be private forever. what are your plans to take this company public again?

michael: i'm not here to discuss that. emily: what about layoffs? you don't have to go public with your plans. do you see redundancies here? how do you address layoffs as a private company? michael: most of what we are doing in the combination of dell and emc is about growth and revenue synergies. those are three times larger than cost synergies. there are some. we will address those as we've always had. you do it in a thoughtful way and responsible way. life goes on. amalie: are we talking thousands? -- emily: are we talking thousands? michael: we are hiring thousands of salespeople. we are adding sales coverage around the world. we know when we get in front of

more customers come our sales increase. >> is the board going to change? you would to a slimmed-down board when you went public -- private. how does the board change? michael: there will be a few changes as our filings come out. emily: i mentioned carly fiorina. she is remembered for that bad deal, hp and compaq. how will we remember michael dell and this moment? michael: this is the second act in what i'm pretty excited about as our future. hopefully will come back next year and we will have more interesting things for you. we are just getting started here. i'm very excited about putting

these great companies together. we did not talk much about the other things that occur in this, nation. emily: let's talk about that. what stays and what goes? starto we see you selling? haveel: within this, you an incredible software company. vce, rsa, there's a has new business that emc created called pivotal. we've been incubating lots of new businesses like secure works. there is a model here where you business andge

businesses and you want to incubate new businesses. you don't just roll them all into a giant company. you let them operate independently and pursue unique missions. has done, attract additional capital into those businesses and allow them to grow and flourish. emily: you've been doing this for 30 plus years. you started selling computers out of your dorm room in austin. when you look into the future of technology and the giants that have arisen along with dell, do you see more m&a and consolidation or more breakups? michael: i think you will see there is another large deal announced this morning in tech, there's lots of discussions around that. a number of the tech and other

ceos come and ask me about the whole going private thing. a pretty attractive option for some of them. emily: what do you tell them? michael: i tell them it's great and explain what we did and how it worked. emily: where do you see more deals? michael: i thought that was your job. emily: you are the guy who's been doing this for 30 years. michael: in our sector, we've been saying for a long time that converged infrastructure and the breaking down of silos was going to occur. combination is a significant step in that direction. there could be others as well. emily: are we getting headlines about yahoo! going private? private --o! going

do you see yahoo! going private? people have speculated that yahoo! could be going private. that could be a way out for yahoo!. michael: i have not spent a lot of time studying yahoo! to give you a thought on that. i spend more time on the business and enterprise and commercial i.t. i understand what yahoo! does. they buy a lot of our equipment to power their network. as to whether it's a good idea for yahoo! to go private, you can find -- emily: where is dell 30 years from now? michael: it's really exciting is how i.t. is jumping beyond its traditional role of making companies efficient into enabling this new transformation where product and services companies are becoming digital

companies. that is the next big leap for our business and the opportunity we have to help our customers. you have to turn this information into outcomes and results. the big new role for the i.t. industry and our company. emily: michael dell, chairman and ceo of dell, thank you for joining us. looking forward to seeing you on stage in just a few minutes later today with soft yet -- nadella.elatya stephanie: how about michael dell? erik schatzker is in san francisco this morning. erik.orning, tom giles is with us from bloomberg news.

let's break down some dell, delmon. -- gentleman. >> they now have scale. -- everybody has scale in the business. one of the interesting things that remains to be seen is going private a better way to provide a solution. that i have not heard from hp. dell is better added. i've not heard the answer from dell, either. david: i did not hear much discussion about the club. that word did not come up. >> this is a big bet on the data center. that they will provide a combination of solutions that people will want. there's a lot of equipment that goes into these data centers that feeds the cloud. in that sense, it's a smart merger because it is forward-looking. we are doing so much work through the cloud in the data

center. what might big take away was he loves being private. he loves being out of the glare of the public. he told emily in a very hard-hitting interview, we like this idea of being able to do our thing and get our thing done without the glare of the public markets and those pesky activists. --phanie: the data center what they are doing is in the back end where and users -- e> we've moved from a universi being proliferated with gizmos to the back end driving those gizmos. however experience isn't shaped by how fast we can access the internet, how fast we can enter -- access storage and how many apps we have. those are driven by the back

end. it is more in the picture. david: he thinks he will get out of debt quickly. >> a lot of banks are benefiting from that. it's an expensive deal. he will not have to tell everybody every quarter this is how we are doing on the sales. word "debt." the michael dell is among a number that notho believe only is it ok to take on a lot of debt today to finance deals like emc, but they expect they will be able to pay this down aggressively over the next 2-3 years. i want to put this question to tom. that seems to be predicated on a view that things will be rosy enough for them to generate enough cash flow and sales growth that you can actually do .hat deleveraging

with the global economy where it is and the pressure that faces , is that too optimistic? makes aebt argument tremendous amount of sense because these companies have revenue growth challenge. capital structure becomes a big deal. the other point that michael dell made which made a lot of sense is that buybacks historically have not worked in technology. technology companies spending a lot of money issuing debt to do buybacks have not been effective. if there is a better use of that , i'm all for it. it seems to be more effective. stephanie: was it ineffective for ibm? >> a lot of technology companies , rather than being specific about individual companies, a lot of companies have bought back stock. rich balanceh

sheets. erik: i wanted to reference the point that michael dell made about the expectation that we will see more tech mergers. points to the sandisk western digital deal announced today. we've had two others. another $10 million deal. -- $10 billion deal. that has to court the are of the antitrust cops because they shut down applied materials earlier this year. >> there will be some deals that will be parsed more carefully by regulators than others. --re is a china angle with on the whole, they will be more

involved, the regulators looking at non-us interests. on the whole, this is a relatively fragmented market that is revenue growth challenged. if you can put together these companies can extract cost synergies, liberate up to some degree -- lever it's up to some degree and offer a better option to customers -- stephanie: the amount of technology deals, took a look at m&a to measure this -- julie: the green line is the number of deals, blue line is the value of deals. not only -- this goes back several years to 2010. not only are we seeing the number of deals increase, but the value of deals increasing frequency and size.

in technology, it has been very concentrated. companies are finding an attractive to ring these various benefits of these deals. >> benefits being cost savings. that is huge. we asked dell about stock cuts -- that is where this growth will come from. you are having so that's slow sales growth. you will have to cut costs. -- you are having slow sales growth. david: this sounds like a maturing industry. you have consolidation and cut costs. you buy growth. us tonie: he will turn the next thing we want to talk about, yahoo! people looking for the next chapter. the only star in that organization seems to be ollie alibaba.olli

>> we ultimately need to work to improve a relevance to end-users and how many times they come to us. we have most people online over the course of a month or any given day coming to yahoo! either on the web or on mobile. the focus will shift even more towards mobile and getting more users -- more usage per user every day. >> she puts her finger on it. david: they have huge reach. 700 million people every day. they are checking their e-mail. they don't stay. >> reach does not equal relevant. that is her biggest challenge. she inherited a troubled company.

it has been difficult to turn around ever since. the focus has been on alibaba. what is left? there's one other challenge, monetization. she missed her revenues a little bit, but not that dramatically. she is standing still while digital advertising is doubled. yahoo! is going nowhere. when you are flat in an upmarket, you are in trouble. >> marketers want to put their money on facebook google, twitter. it's not yahoo! david: we thought mobile would hurt them -- stephanie: ipo day, the achilles heel, what are they going to do with mobile? it's now a shining star. grissom meyer has been in the job four years. mayer has been in

the job four years. david: she may have a challenge finding relevance. >> doesn't someone come in and buy them? do they get taken private? david: why doesn't softbank by them?-- buy bae market cap without aliba -- >> verizon just bought aol. uy yahoo!?b stephanie: thank you so much. only a bloomberg can you get experts like this to break it down. what are you doing in san francisco? erik: when the sun comes up today, i will be sitting down with the ceo of

wells fargo, the best run bank in the nation, talking live. stephanie: he is running a victory lap. people took them as the plain-vanilla guy. he is now in the cool club. emily chang in austin, texas. we will stay with you. ferrari'sour rate -- u.s. ipo off to the races. ♪

stephanie: welcome back to "bloomberg ." check --wo major deals changing the tech landscape. sandisk is a leading maker of the flash memory chips.

kla for $10.5 billion. general motors has a profitable third quarter. gm spends $1.5 billion -- fiat chrysler and starbucks getting huge tax bills. each company owes about $34 million. that is the latest bloomberg business flash. stephanie: i think today is the best of bloomberg. tom giles and brendan greeley in the house. give us an update. brandon: i was at a conference -- looking at the depth of the treasury market. it is insanely drive. since last october when there was a sudden spike in yields or drop in yields on treasuries,

the fed has been wondering, do we know just how deep these markets are? do we understand how the treasury markets work? there's a lot of different things going on. we are waiting through these reports. u.s. treasury market is one of the deepest and most liquid markets in the world. --, we are a little worried one thing going on is the traditional broker-dealers are -- their holdings of treasuries have gone down. there's a couple reasons why this might be. they've had to increase their leverage ratios. it becomes harder to hold onto assets. we have to reform. frank -- dodd frank. david: there was a study that came out from new york fed officials who said no problem. this plenty of liquidity.

-- there is plenty of liquidity. brendan stephanie: there is a disconnect with market practitioners in those markets. we sit here every day with investors saying i need to sell 5 million high-yield bonds. brandon: we have talk about corporate debt. s, the harder it it is to do it, the harder it is to place them. stephanie: given the nonsense returns they are getting from treasuries. an: maybe this whole thing will clear up one rates go back up again. david: the people we've talked to say it because we don't have as many players number anymore. brendan:- high-frequency traders are now

engaged in this. they are providing all the liquidity. they have different motives. people who saye we are worried about liquidity. you don't really know, is this an attempt to reform dodd frank or is liquidity really a public good that they accidentally provided to all of us? david: could be a bit of both. stephanie: when that liquidity gets tested, who pays? when the financial crisis happen, lots of people pay. banks did. it could be retail investors. you talk about high-frequency trading and dts, that's who own those products. dan: you have to hold a certain amount of liquidity. you are the buffer. there's no good answers right now. david: not yet predict you will

go back to the conference and get some. we will be talking to the harley davidson ceo. we will bring you the latest, next on "bloomberg ." ♪ the only way to get better is to challenge yourself,

and that's what we're doing at xfinity. we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around.

>> pearson company stories. one, shares of credit squeeze are falling today. the third-quarter results missed analyst estimates. credit suites is trying to satnd and francinelacroix down with the ceo. >> it's unusual for us and me to do more.

we need to create a swiss universal bank where we have everything, a big investment bank and our number one. we have been for 20 years in switzerland. we have a really good return. where number one in ultrahigh net worth. in business, it's easier to do more where you are strong and where you want to grow. the notion that we need to put more capital in switzerland and invest $400 million over the next few years is right. brendan: you know this world really well. stephanie: this is a human capital business. they don't make computers or tv sets. this plan may be good for potential shareholders because it's good long-term. you have to say to your employees this is a whole new world. how you use to get paid, that party is over. the supertalented people that highhere, the people in

net worth sales which was a great area or investment banking, two of those individuals want to work in the organization and when they say no, that's it. might adopt the same leverage ratios that the u.s. picked up. david: you got other things that you have to do. stephanie: it's the regulatory environment. and the waynged they do business has changed. to change the way they compensate their employees -- banks used to be organized to employees. now they are trying to make a shift to serve their customers which is the right thing to do but maybe they lose their top talent. erik, we have not heard from you. stephanie: hold on a second. the only destined one and only sergio marchionne rang the bell.

erik: i think we have to raise questions about the future of the credits we trading and investment banking business in the united states. this is your almond moderate, you know the one that philosophy they were trying to create --, major alm -- they havea offer the financial advisors, high net worth guysmater. bonus to go tog wells fargo of all places. it reminds me of dean witter by morgan stanley. their goal is the one bank philosophy and i wonder if it can hang together in the united states as well as they would like. stephanie: cross selling is the name of the game and if they are

getting out of 50% of the prime services business, it's exactly how you win over hedge funds. what message is going across. julie: i have been looking at u.s. banks as well as european banks. it looks like you are talking about regulations on both sides of the pond but european banks of underperformed more than u.s. banks so european banks are the green line. this is global financials on the bottom part of the screen. european banks you've seemed to worsen u.s. banks have been paced more broadly in the u.s.. brendan: the u.s. has higher capital ratios in europe. does not sound like the entire story. we are from banking to manufacturing. number 2, general motors strong light truck sales. chinaales beat the

u.s.. matt miller as the cfo of general motors about the impact of china. >> we have been monitoring and expecting the industry in china to moderate and we took very proactive action starting this efficiency.e cost the results of that prove themselves out with our third-quarter results. we said we would sustain our performance in the second half of the year. thus far, we have half $1 billion of equity income, 9.8% net income margins and we will continue to execute the plans that we talked about in the second quarter. there is doom and gloom in the oil industry. hadnder if the oil prices

not been as low, maybe they would not have as good sales. brendan: we saw light trucks surge in the last few quarters for gm. that's a relatively old story. what strikes me is china. trying toting around figure out when china will rebalance and buy more consumer products. it's a huge beat for them in china and that stuck out. david: that's another data point we have heard is that consumer demand in china may be holding up. we hear little nuggets about that. consumer demand is still up. brendan: if we decide we cannot trust these official numbers, we hear -- david: it has been rumored. brendan: it shows a shift toward consumption but we can use these numbers. stephanie: what's number three? it's the aerospace company that reported a big heat. it showed progress, boeing controlled costs of its 787

dreamliner. orderave airplane backlogs and boosted its full-year profit outlook. there are a couple of things going on here. we have these orders coming in from the international carriers. you look at these long capital projects, 25 years of development for the dreamliner. ,ou have this unplanned exhaustion is shock which is new international carriers eying up the supply is buying up the supply. stephanie: we will look further into the aerospace industry. it is very morning, good news for boeing on just about every conceivable front, a very strong quarter. that the focus is more on deliveries. that's where the companies like boeing and airbus make their money. orders have tempered a little bit this year.

had been freaking out investors. there were concerns that aerospace might be nearing the end of the cycle. we will have to wait to hear what boeing has to say on that team but in terms of factory boeing is moving in a high gear now. this $500 million backlog, walk us through the carriers, who is buying? julie: remember, those are orders that have been amassed over this amazing run for aerospace. it has lesson about a decade. it has lasted about a decade. the backlog comes from all over the world but china is an important part of that, a very strong player. been cut someve concerns in certain parts of the world, so far, activity out of china seems to be very strong and holding up. looked at a report

about chinese projections going out in terms of air passenger traffic projections over the were10-15 years and there dramatic numbers about the number of airplanes they think will have to be ordered over the next 15 years. julie: yes, absolutely, it's mind blowing. china is poised to overtake north america as the largest aviation market. we were the birthplace of aviation. that is a big moment. it's coming very soon. got this invigorated chinese middle class. they want to get out and see the world. erik: did boeing have anything to say about what it will do with this cash, this extra cash that it is now able to generate out of its backlog? will they raise the dividend or intor&d? starker plow julie: catches them the

investment story for boeing for a couple of years. it is starting to turn over cash to shareholders at staggering levels. they have spent $6 billion on buybacks this year. they bought back 41 million shares and have another 6 billion under share repurchase authorization. david: thank you very much for joining us. let's check in on the markets. we are seeing all three major averages in the green today. what we have seen recently is it's not a macro focused market. people are focused on individual companies that are reporting earnings. on any given day depending on the balance, that's where we see stocks going. earnings tend to be mixed. you have the major averages. we have been talking about

general motors and the shares are up by 4.5% after the company beat in terms of earnings and sales. the shares are definitely benefiting. i have been looking at biogen. there has been volatility mostly on the downside, the price action we have seen. biogen's rebounding after declining more than 20% this your because the company beat earnings estimates by a wide margin. at the same time, it is restructuring because this past quarter was good but it has been struggling. the company is cutting 11% of its workforce and says that will save it an estimated $250 million and its refocusing its attention on the drugs it thinks will have the highest chance of success. thehat front, one drug is hallmark and the sales were better than estimated and yahoo! is another one. that is one that's on the downside after the companies sales fell the most since 2009. everybody wants to know about

alibaba. company says maybe january which will be later than the end of your target that yahoo! had originally set. still lack of clarity. david: thank you. coming up next, we will sit down with the ceo of harley davidson. we will talk about how the motorcycle maker is spending -- is fending off his rivals. ♪

stephanie: you are watching "bloomberg. go" julie: we are starting to get for re: shares, $62. -- for rory shares. -- ferrari shares.

they are trying to figure out with the opening price should be so even after stocks open for trading, it can take half an hour or 40 minutes or sometimes as long as an hour to figure out with that price will be. i sold those shares at $54 apiece which is above their normal range. it has gone up since then. we will see where they open up. david: we will watch with bated breath. here at with us is the group president at the new york stock exchange. win this?u i like your jacket very much. >> thank you. congratulations on the new show. we are having a blast down here. we've got the ferrari family mre and johnalkin and sergio

archionne who stepped in and saved chrysler. we had the first trade for further irate -- ferrari. at $52.d it looks like a textbook open and very smooth. is still trading in the $59 range is what you want when you open your stock in an ipo. we have a blend of human and technology and we don't rush the ipo's. we only open it when the moment is right and looks like this was a good one for ferrari. david: how did you get this? way when most international deals that come to the united states. we have about 80% market share whether in ali baba or a colombian bank and when those the twos list here,

primary reasons is when you list on the new york stock exchange, you're associating yourself with in tales. and what it it's a great network of well governed companies with very high standards and you can take that back to your home country and it gives you good credentials. being a part of that incredible network of companies is a benefit we have that no exchange around the world has. stephanie: it looks like a party but this is no joke or a game. this is serious business print we have seen a number of companies pull back. there was a backlog of ipo's. many have said maybe they need to hold off. was the actual outlook as far as what you have coming down the pipeline? we don't know what things will look like tomorrow or next week. iposst like we don't rush on the listing day we took two hours, 50 mins with ali baba, we don't rush ipos in terms of

which day they choose. we don't advise companies to go ahead and go public. the right answer is different for different companies. we have had a number of successful ipos over the past week. does have traded up 25%. first data was large and that's trading within a couple of percentage points of its ipo price. why look at the company that did not ipo and there is a handful of them, these are great companies and they can afford to stay private and continue to work in their business and find the right time to come out and have their debut. brendan: two dimensions specifically are albertsons and neiman marcus. what is the right level of volatility they should be waiting for? if you do a chart of volatility in the number of ipos, the lines run in opposite directions. as volatility has heightened, you'll get fewer ipos. that is what we are seeing now.

2015 has been a more volatile year than last year. iposve done roundabout 50 and we did twice that last year. in the last couple of months, volatility spiked to another level and the number of ipos we fewer. that trend will reverse as volatility comes back down and companies think it's an appropriate time. albertsons will come back and we will wait for them. stephanie: there you are geared -we and youferrari have a dozen hot rides lined up. ar outside the exchanges were occupy wall street took place. we have presidential candidates continuing to go after wall street and demand more regulation. where is the balance? this feels like the rich guys getting richer. >> i'm glad you asked that. the cars are lined up at wall street and broad street. where george is

washington stood in 1789 and took the oath of office, the first capital of the united states and the bill of rights was ratified. at the same time, the new york stock exchange was founded in 1792. when you think about the great attributes of the capital market, there are too many to mention. nearly all the great innovations in this world over the last two centuries have come from america and that's because of the deep, rich capital markets. innovations accept ferrari. the improved quality of life we have been able to exploit around the world is because of the capital markets that were formed here. brendan: thank you very much. david: that is a very dashing jacket. let's move from one form of transportation to another. harley davidson shares fell the most in seven years yesterday after the company missed its third-quarter estimates and trend is worldwide shipment forecast by 11,000 motorcycles. to fend off its rivals, it is

pouring tens of millions of dollars into marketing and product development and will add up to 200 dealerships in emerging markets by 2020. we have the harley davidson ceo and he joins us now. >> thanks very. much. david: tell us where you are and what these plans are because you are making a substantial investment. >> we have been working diligently since the down torrent -- since the downturn are doinge view is we fantastic work getting our house in order and we are pivoting to the marketplace and making a strong statement about our plans to lead in every market we are in and putting the investment dollars behind it we believe necessary to lead. that is holding our market share position in the united states and that is investing to grow the sport of motorcycling in the united states because it still 2/3 of our business. we have been a leader in this market for decades.

almost everyone on a motorcycle is on a harley and to grow in the united states, we need to invest and grow the sport and need to defend our market share. david: what is the market share now? >> around 50%. 601 cc's in the heavyweight class. david: is that growing faster? >> we have had great growth in this quarter. in the asia-pacific region that's growing. latin america is struggling. the economies in brazil in particular affected that. we have invested a lot to grow internationally coming out of the downturn and will continue. you mentioned the 200 new dealerships and was determined this opportunity for growth and distribution internationally so we are investing in that.

increase the region the impact is what we say. brendan: you don't have to brand a harley in the united states. who rides a harley looks like you and me. when you're selling a harley abroad to a new audience, how does that brand change? >> it is one of the most fascinating strengths we have. been in india in our history until we got there in 2009. i was there for the launch in delhi and we did not have to ask plane to anyone in india with the harley davidson brand stands for. it's personal freedom and a dream that every human being has the crosses borders and cultures and generations. we see that here in the united states and we see it in india and we do not have to invest to tell people what harley davidson stands for. brendan: in india, you're competing with a lot of established brands that are beloved there. yes, there are a lot of

motorcycle brands that are unique to india. it's an incredible two wheel culture. we don't have to invest to teach people how to ride motorcycles. their first powered vehicle is generally a two wheeler and a lot of small displacement so as the middle class grows and disposable income grows and infrastructure improves, we have seen a migration from the small to premium brands like harley davidson and we are having great success in india six years in. stephanie: you've got an engineering background, let's get your take on mobile wagon scandal. -- volkswagen scandal. >> it's a big disappointment. our company is relatively small but the volkswagen situation just reminds me and every leader to make sure you understand the tone and expectations within your company. as the ceo, you cannot know everything that's going on but what you have to know is that you have the integrity and value

structure in the company so that people are making the right call every day, every time. this ise: do you think just a couple of engineers? >> i don't know and i don't want to speculate. it is conceivable in a big company like that. case, i think there is a tone coming from the top. what's the company about and how do we do business? david: you are investing a lot of product development. have you considered -- you have a high end product. the expensive in marketplace for it have you considered having a second product line that would have a different brand that would be more economical? >> we haven't. the harley brand has incredible strength and power as i alluded to. we are expanding our reach and

appeal and their impact through product development and the new street 500 and 750 is a phenomenal success in india. it's our number one seller in australia. inamia andsix seller we are 18 months into this new product that is physically more accessible to people of different physical height. we use it for our rider training program in the united states to bring new people into the sports of these are investments we are making to expand the reach of harley davidson and their impact with customers. brendan: one of your challenges in the u.s. is a weaker yen and imports from japan. of thethe criticisms trade pact was that it did not look at currencies. are you happy with the trade pact? sorteryone of these deals of has a two-sided effect. we look more at the positives and what it opens up in asia. we will work hard.

we have seen a lot of competitive impact due to the currency swing in the united states this year. that's a lot of the reason for the market share giveback we have had. our commitment to put our foot down and invest to defend our leadership position in the best to grow it applies. this is another factor. it also helps us on the other side in opening up trade in what we see as an incredibly high growth market in asia-pacific. stephanie: we know you clearly drive a harley but what kind of card you have? >> i have a ford f1 50 raptor. stephanie: there you go. thank you for being with us. that does it for "bloomberg go." join us tomorrow at 7:00 a.m. ♪

scarlet: welcome to the bloomberg market day.

from bloomberg world headquarters in new york, good morning. ferr are making their debut at the new york stock exchange. ari we will take you there live in a moment. he did not steal it all, some of the bernie made all investors will not lose a dimon we will explain. the blackstone blockbuster, get rid of your 401(k) and get -- and replace it with a retirement account that has guaranteed return. we've got an exclusive interview with the blackstone president. ferrari raised 890 $3 million in its first initial public -- 800 $93 million in its first initial public offering. shares just begin trading and are currently up $