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 to $55.

let's get to matt miller who is live at the new york stock john elkin who just rang the opening bell. matt: good morning. an important day to day for you but also for the family. you are now the biggest shareholder. plan to sell part of this or remain the biggest shareholder? >> it is a great day and we definitely look forward to staying and remaining the largest shareholder offerrrari. matt: i think you have a 23.5% stake and 34% of the voting rights. what's most important for this brand going forward? you have already said you will make a few more cars next year, possibly 9000. >> the brand is extraordinary

and the importance is to keep it as it has been. there is no doubt that whatferrari means and with we have seen this today with the incredible interest from everyone and the general buzz and excitement about it. that will be kept. is the market becoming weaker without ferrari. >> this makes a huge amount of sense and enables ferrari to and a life of its own allows the shareholder to have clarity between these two businesses who have been very successful together. now they both have a great journey ahead. matt: you have unlocked billions and billions of dollars, the fda will end up getting about $4 billion from this deal. do you see anything else like this? you have so many brands that could end up the same way. >> ferrari is very unique and

has been always independent. the fact that it has a life of which has something been thought through and worked into the many years where ferrari led the world. has a large family of brands but they were together in no doubt >> this is important. did you expect such a huge interest from investors? it was over subscribed before going to the market. is there too much and doozy as them over the shares? too much and doozy as them over the shares? -- and louisiana's him entusiasm. >> i was excited about>> the brand developing and it's about many new shareholders and what

they believe. matt: there will be many new shareholders. shares are up since you floated the idea about this a year ago. how will that work? ipo f,e sold 9% in the has a 10% stakeerrari and the other 80%, how will shareholders be able to get that and when? then beginning of january, fca 80% stake will be distributed to shareholders. that's when we will become the largest shareholder. we look forward to have a strong association with the son of the founder. and being able to be good stewards as we have been, as our family has been for the last many decades. let's talk about what you

have done which was remarkable. you have done more in the last are than the last tenures. is the portfolio completed or are you looking for something more? >> we have a lot to digest. -it hasook at this year been a busy year. now --much look forward there is not that much capacity left to do much more at least for now. question me ask you a about sports. ferrari is racing, the most iconic name in the sport. how important is winning races company?u as a will the fact that is publicly owned her durability to invest in winning races? racing is very much within

what the essence of we are. achieved improvement this year and that demonstrates how they are on the right track. matt: thank you so much. that was the chairman of fiat chrysler, the larger shareholder in ferrari. scarlet: thank you so much. the ticker is now at $55.93 and it had opened up $50 and climbed as high as $60. looking at the broader market, no real economic data came out today. about half an hour into the start of trading so let's check in with julie hyman. it is really stock driven by all the earnings coming out so that means we are seeing a mixed picture unmixed earnings that continue with the dow and

the s&p slightly higher and the nasdaq slightly lower. posted its biggest quarterly drop in sales since 2009. the shares are down 4% and yahoo! says the alley bob a spinoff of its stake my not happen until january. it had targeted the end of the year. investors had wanted more clarity and wanted that spinoff to happen sooner. le sinceop for chipot april. they cannot with earnings and saw a negative reaction in the shares. profit came in short of estimates even though sales were up 12%. the company said higher labor costs and marketing expenses cut into their operating margin which shrank by 50 basis points. you can see the growth has moderated to a sharp degreec hipotle was such a rapid growth

stock at one point that the more piling in but investors have less of a reason to own it now. 33 companies in the s&p 500 are reporting today which is the most so far this season. give us some winners. julie: one of them is in biotech. into the thick of reporting season for the biotech companies, experts say we would see the stocks bounce back and move past concerns. put upsis not of usually nearly 2% after the earnings per share blew away estimates. it has had a tough year. it's also doing restructuring, cutting 11% of its workforce in rio allocating resources for the drugs they think of a better chance of success and pulling back on some of the others. we are also looking at boeing. it is seeing higher jetliner deliveries and it said dreamliner costs are growing

less than projected. the shares are now pulling back so that's a switch. they were higher earlier. maybe something is coming out of the conference call. scarlet: thank you so much. let's check in on the news. vonnie: thank you so much. we start with the crisis in syria. it will be the focus of a high-level meeting friday in the and i would secretary of state john kerry sitting down with the russia, andsters of turkey. president assad sat down with vladimir putin. the russian jets are targeting rebels. says they areial holding two suspects in connection with an amp flight

103. the two suspects are believed to be imprisoned on unrelated charges. a total of 270 people including 11 on the ground died when that plane exploded over lockerbie, scotland. the iranian leader is signing off on a deal with the west. it was read today on state tv. warned his government to be vigilant saying the u.s. cannot be trusted. house conservatives and not rushing to back paul ryan is the next speaker. will take the job as the party unites behind them and to get conservatives on board behind him. rallying appear to be around hillary clinton since the first presidential debate. she is thesays party's most electable candidate. nearly 80% of those surveyed have a favorable opinion of him

-- of her. you can always find the latest news on bloomberg.com. scarlet: thank you so much. you are looking at a live shot of john boehner in washington. he's getting ready to come out to the podium. this is the morning news conference where we will likely hear his thoughts on whether paul ryan will succeed him as speaker of the house. we will monitor this from headlines and bring in the latest in paul ryan indicated he would be open to the leadership job with a couple of conditions. we'll get to the details coming up. let's take a sneak peek at what's coming up. snapped upital standard for $19 billion. it's a big semiconductor deal. we will get the buzz from the west coast and that and more is coming up. ♪

scarlet: good morning and welcome back. it's time for the bloomberg business flash and we look at the biggest business stories right now. toyota says it is recalling another 6.5 million automobiles worldwide to fix power window switches. they could short circuit potentially leading to a fire in vehicles were produced between 2005-2010 and they've already called 10 million cars for airbags. america's love affair with pickup trucks is driving general motors earnings. the third-quarter profit beat analyst estimates. truck sales were up in the u.s. and jim overcame a tough car

market in china by boosting sales of more expensive suvs. spain of earnings, coca-cola posted third-quarter results that eternal staff -- the analyst estimates. they have been on a cost-cutting binge. it is now selling smaller containers of soda at higher prices per ounce. you can always get more business news at bloomberg.com. as promised, we will go back to the market desk with julie hyman. m so much&aave had activity within technology in the past week. this deal is done in the chip industry. sandisk was in talks and could be bought by either western digital or micron. western digital one it, $19 billion is the price, $86.50 per share and we are not seeing it rise quite to that level. it was a cash and stock deal.

investedity in china in western digital so it's not clear up maybe western digital is using part of the proceeds for that. china said it wanted to make more investments in other companies outside its own nation. we also have a chip equipment deal l, research is buyingam shares core and the kla are up considerably. we have had some smaller mergers in this industry halted over antitrust concern so we will see if there is anything that could be a potential roadblock. the shares are not performing as though investors are concerned about that. looking emcbm with dell in the process of buying emc, coming out with numbers that missed estimates. the bookings fell short so those

shares are down sharply. battered lready been after the agreement to buydell emc. scarlet: thanks so much. we will dig into the big deal news. western digital agreed to buy sand export $19 billion. this helps western digital with a supply of chips and computer storage. say this sets up the scene for the future but sandisk was still making the flash chips for iphones. >> the growth has slowed but part of that if you turn the tort iphones and ipads, that's what sandisk marketed and then tablets and computers and mobile phones. apple has stopped using some of

to sandisk chips and decided buy the samsung chips and are thinking about making their own. that hurts the sandisk bottom line. they're trying to figure out who else to go to. apple is sort of the king. you put together western digital which is more of a dinosaur in their core business. they build the hard drives, the spinning will hard drives. scarlet: no one upgrades those anymore. >> it's a technology that's getting antiquated. the growth prospects there are not as good. at least you. that with flash technology which conceivably will be around for the near future. scarlet: they are putting together 2 chip companies to make a bigger one and western digital got a big investment from a chinese university. what does that do to their ability to strike deals? >> there is a clause in this deal. it is almost all cash for this deal and of that investment does not go through because of

regulatory pressures because ofpr western 15% digital, they will only significante-amount of the company together. ,f the deal is not go through it would be about 60% cash and of it does go through it's about 98% cash. it's fairly transparent. offering $3 billion and they told them to do am&a transaction and they wanted a piece of the larger company to have access to technology in china can build its own tech franchise to rival the u.s. terms of pressure from investors, we have seen how activist investors have played a big role in some of the biggest deal so far. they have gotten into commodities and consumer space. do you see that in the chip business? so, it's prevalent in

the software business, but we heard that sandisk had hired a firm at activist expensive and the may have been pressures behind the scenes. there nothing really public that indicates that. we will see more software companies targeted by m&avists to push for transactions. the one thing that's noteworthy is this is another huge debt raid it will be over $14 billion of. that. -- debt. that's a lot of tech exposure on debt. it calls into question -- will we see other large tech deals because maybe the money is just not there anymore. scarlet: there will be a lot of supply coming from these tech companies in terms of new debt. breaking so much for the news on western digital buying sandisk for $19 billion.

we've got much more coming up next. ♪

scarlet: welcome back. washingtone you to where speaker of the house john boehner is holding a news conference. kevin mccarthy, the congressman from california, will speak in a moment but dropped out of the race to become speaker of the house not so long ago and we are still waiting to hear who would come in in his place as a candidate. we have heard that congressman paul ryan is looking to join the race. he has a couple of conditions. we want to bring in phil mattingly for perspective. phil: thank you. scarlet: glad you could be here because we we have news on paul ryan finally.

his got a lot of conditions attached. will he go for it? a large portion wants to go for it but it's all about 40 lawmakers known as the freedom caucus. they have decided to back one of their own for speaker, daniel webster, a two-term florida congressman who announced would compete against kevin mccarthy. he is not taking its of out of the race on the paul ryan conditions are first-come he wants to spend time with his family on the weekends. the speakership is a huge fundraising job. john boehner is on the road every weekend raising tens of millions of dollars for the party. party leaders say that is fine. they will take over the fund-raising duties. he also want to unify the entire conference. there are blocks, moderates, conservatives and this hard-line group. two of the three are probably ok for paul ryan except a hard-line group that is raising a problem. in the third and crucial condition, he wants a rule change to take the threat of lawmakers voting him out of his speakership off the table.

that is a crucial problem for that hard-line group. they want to maintain the leverage and paul ryan wanted to disappear. he is saying if you don't give me what i want, i don't want this job and i don't care. the leaders hope that will be enough to sway that caucus. scarlet: we are about two weeks away from the deadline to raise the debt ceiling. what happens of john boehner is still there? john boehner has said he will remain's they name a replacement. october 28 will be the vote. paul ryan has given a deadline of friday to figure out whether he has a unified caucus. by over 28, house republicans should have decided on the speaker. republicans right now are going through a process. it's very familiar. scarlet: it's like a broken record. putting upboehner is a bill that will allow the payments.o prioritize

they have done this over and over and the senate will take us up and the obama administration will veto it if it happens. but this is the process they have to go to. give your members what they want and it gets rejected and eventually, it will come down that they have to approve a clean debt ceiling increase. how they do that, we got a couple of weeks. scarlet: that's what they get paid to do. let's talk about the freedom caucus, 40 guys in congress, how united are they? what is their mission beyond disrupting business as usual. phil: they have a caucus role that 80% of their members come if they support one person, the entire caucus backs it. if they stick behind daniel webster, paul ryan loses 40 members and he won't run for speaker. they want to fight. they want to have these battles. they want to force president obama to veto a prioritization bill on the debt ceiling. that's the big issue and he want to distribute power more evenly. they don't want to take off the ability to recall paul ryan.

they want to be able to say to the speaker that you mess around with us, we have the power to get rid of you. that's what they did to john benner and that the leverage they hold. it's tough to see them giving that away. scarlet: thank you so much. p paul ryan has until friday? hil: the clock is ticking. scarlet: thank you. raisingrari $893 million pricing the shares of the top end of the market range after investor demand outstripped the available stock. the shares just began trading about an hour ago. we want to check in with matt miller once again. stock is up about 8% in matt miller is live from the new york stock exchange with sergio marchionne who just rang the opening bell. away i hate to break it from the excitement of washington to talk about the dull world of automotive

manufacturing. e is here andionn congratulations on the positive outcome on the ipo which was smooth and quick. >> you have raised $4 billion? wait a minute, we raised $1 billion. matt: you'll take out $3.2 billion question mark >> the calculation is been exaggerated. fca butit is funding that's not the entire story. the number is smaller than that. don't worry about it, it's a significant reduction in desperate the more important thing is we have treated our shareholders in a way that i think was long overdue. you called it the automotive errari isdefine f perhaps an exaggeration. it's a unique piece of animals that have four wheels and a steering wheel.

this is not really a car. of artunique expression and technology, very exclusive, very properly priced but not inexpensive. there is no equivalent to this in the world. andeeded to show this world the market has reacted to it. it would have been ashamed to live it buried inside a large car market. ker. they have only made 7000 cars last year. it's a different business model. we need to give it an opportunity for the shareholders to benefit from the association with the brand and from the valuations and the economic matt: i'm going to let me ask a question. >> that's my job. what does it change the ferrari

ipo with the spinoff from fiat chrysler now? sergio: i think it has purified the portfolio. that is one piece of the valuation equation. ofhink there was a lot speculation as to what this business was worth. hopefully, that issue has not gone to bed. we have seen market values around 10%. we will seem the market value assignment when we lose complete thinkl ferrari and i ferrari can be in the luxury space with its peers. is. is what ferrari it cannot be viewed as a carmaker. ferrari known car foructs other than ferrari errari? sergio: we are not in that

talent full today. we will need people to build it a piece at a time. i expect in the medium to long-term that we will build a business that is capable of those products. matt: for those viewers who do not know, tommy is a bloomberg news reporter and he is following sergio around the world. stockerse called them in a majority of cases. in the case of tommy, he is an alker.ionate stock if it matt matt: do you plan this push to combine with fma? some people say is not beneficial to shareholders of his company. sergio: i do not know mr. stevens and a lot of people outside of general motors. i look at the data and try to make industrial brands. answer you

specifically about g.m., do i tonk the analysis pitch the markets in april about excessive use of capital by carmakers is still valid today? the answer is absolutely yes. do you think we are trying to use it this world? yes. we have affirmed a right to raise capital. i think we need to correct our ways. but it is general motors or some other solution, it doesn't really matter. we need to go straight. if we do not go straight, we will run the risk. one thing -- i saw their earnings and a column at them. they have dimension of this job. issue for me is not to make decent money in good times. we had done this. this is now breaking sound varies within the u.s. environment. there is no doubt a down cycle. when that happens, the reality

that we have managed can be completely of a different color. unless you really secure the utilization of capital in the most efficient applications, i think you are going to fail and delivering the returns that shareholders have what you once you money. case, case of gm in our the money was eventually shifted out to the capital markets, but it was given a chance to the taxpayers. chrysler paid it back. let us not forget the failure. failure happens and you cannot ignore the event. , youu manage that crisis realize how tenuous your life is. in a business that makes relatively acceptable mar gins and suffers like a dog in the down cycle, you do not want to go back there. >> we mentioned the ideal parts. sergio: on their analysis, they

offer greater spending that associate with the merger. that's of the paris that i looked at. matt: what do you think about volkswagen now that they have been hit so hard? >> either tremendous amount of respect for volkswagen. they had done things for a technical's endpoint -- technical standpoint that should be commended. this last set of events indicate that the government system found that volkswagen was not working and that things can happen unbeknownst to the leadership, but it was a governance earlier. t's people are saying i affiliate of diesel. i do not think it is true. i derive no joy from the failure. we collectively are going to pay the price for that failure. once -- compliance engagements that this industry will have on and will be forced

on us because of the cost to the public is going to become tremendous. it will go up exponentially. we are all going to pay the price, which ultimately will be passed on to the consumer. but it is our fault. he brought this on ourselves. matt: i want to ask one more question centered on ferrari. you say that ferrari is a different animal than a typical car. as a formula one fan, i wonder how important it is for you to invest in winning races and how much does being a public company affect your ability to do that. sergio: it is absolutely crucial to ferrari to win. i do not think ferrari has skimped on the investments of formula one. i can also tell you with a degree of certain seat -- certainty between 2008 and now, that capital was not well spent. what we have done now in 2015 is brought in new leadership and refocused and retooled the house. we are beginning to see the results of those efforts.

in 2015, a number of podiums for the team. we're going to walk into 2016 ofh a much greater degree confidence and we can put them a debt and mercedes's track record. ferrari will try to do its best to stop them. matt: good luck and thank you so much for spending time, sergio. that is the ceo of fiat and ferrari with a successful ipo on the new york stock exchange. that is matt miller outside of new york stock exchange. we want to head over to julie hyman has breaking news on value. valley of pharmaceuticals, which has been scrutinized by investors and congress for that matter on pricing practices, has a damning report that contains the smoking gun and asks if this could be the pharmaceutical and run? enron?

this is well known for publishing reports on stocks. the stock dropped very sharply by about 27%. right now, it is down by 21%. i'm still going through this report and it has to do with telling of a pharmacy in california. this does not have to do it drug pricing practices. this goes to the allegations about right fraud on the part of citroen. among other things, it is looking at parallels that enron saying they doeo not have any experience running a business fo before this. it's mixed for a document and its based on research that another company did earlier last week that then citroen picked up on. when wend to remind you talk about value, it has some prominent shareholders. take a look at my bloomberg terminal. right here, pershing square capital, bill ackman -- his

stake sell as much as $585 million at one point today because he owns about 19.5 million shares in this company. the operator of the sequoia fund is also a very big holder. this value act holding, which is an active it manager, john paulson's company, if a lot of prominent holders in this company are taking a bath not just today, but they have over the past year. we have seen the stock down very sharply. about breaking news that came out that has to do with oil inventories here in the united states. it is a larger than estimated bill and -- in inventories. twice whate than analysts estimated. we are seeing oil come off the lows of the recession, but it is down sharply today. oil has fallen for seven of the past eight sessions. we have seen it rebounding over the past month or so.

that rebound has come very swiftly to a halt as oil supply and thecerns do persist inventory number does not do anything to reassure investors on that glut. scarlet: up to our eyeballs in oil. that is how tom keene would describe it. julie: sounds about right. scarlet: thank you so much. we are working on getting comment from valeant on those accusations from citroen. now i want to head to vonnie quinn with the first word news. vonnie: comments from john boehner speaking moments ago. he says that paul ryan would make a great speaker and this is after ryan would seek the position but on his own terms. he will do the right thing for the people of the country. he is looking for the speaker job said. -- next wednesday. prime minister benjamin

netanyahu meets with john kerry in germany. is their second meeting and less than a month. 46 palestinians have died. that includes 25 israel identifies attacks as attackers. dilma rousseff and a group of high-powered lawyers have begun proceedings. lawmakers will decide whether to go ahead. she is accused of doctoring fiscal accounts and markets have worsened the economics want in brazil. that is a look at our first word news right now. you can always find the latest news on bloomberg.com. scarlet: vonnie quinn, thank you so much. victims of bernie made off ponzi scheme will see more money. the trust is preparing to allocate another $1.5 billion to victims. it is the second-biggest retribution today. when it happens, 57% of the lost principle will be repaid. joining me now is irving pickard

and his chief counsel. thank you so much for coming in. ir, irving, let me start with y. you're more than the halfway point here in the effort to repay victims. are we and the fifth inning or the sixth inning and is a chance of extra innings if we go with the baseball analogy? irving: i'm not sure about extra anings, but we have anothe number of innings left to go, perhaps three or four. scarlet: does it take longer with the last couple of innings with the distribution? irving: there is some litigation pending and that will draw out making future distributions. scarlet: a little bit of a competition in terms of waiting for that to settle. david, went you anticipate finishing the distribution and how me cents on the dollar will ?eople finally get back o david: $.57 on the dollar.

at any is $200 million in this case. we anticipate anything now is probably somewhere in the mid 80's, about 85. it could go as high as 90%. it depends on the outcome of some of the litigation that irving is speaking of. i'm very confident that we are going to do well. it will take another two to three years to get through the rest of the litigation process, which has been pretty arduous up to now. it is going to continue to be so. i would say two to three years that we should be in good shape. we are pretty close to the end of distribution. there will be a lot of wrapup in the case afterwards. scarlet: a lot of things to clean up again. i want to read you something and consumerfrom protection said that the recovery today foar exceed the expectations since the beginning of the case. irving, how have they changed over the years? first: early on, in the

couple of months, it was hard. within a year or so, i think we thought this would be more like maybe $.10 or, close to $.15. works a result of the good that the members of the legal teams and our forensic accountants have done, we have been able to a couple of what we have done. scarlet: there are still people irvingre who argue that, picard, you're leaving some victims out in the cold. they say the amount on their final statements from bernie made off was inflated by state transactions and products. it should be amount that they claim. why are they wrong? not something they decided or i did, but the courts decided a long time ago.

it's called a ponzi scheme for a reason. there was a guy who created this whole utilization of other to find hisey scheme and that goes to the turn of the last century. it ultimately ended in the supreme court and the supreme court decided it is a zero-sum game. is only way to rectify that if we took scarlet's money and give it to irving, i have to get back from irving to give to scarlet. it was not that we looked at it and said let's do it this way. of preordained. coupled with the fact that if you did utilize the fictional creating, that he was you would be reinforcing the fraud and letting the fraudster decide the outcome. it certainly would be far from fair under any circumstances. scarlet: good explanation that. we talked about the litigation and how that is still a lot pending. or supremeeals court court made any rulings in your case that you think will have lasting impact on industry that would go beyond this distribution? irving? -- well, think that

the supreme court has really not decided. they have denied in our cases. that ends that particular piece of litigation. cases one of the the safean impact is harbor under the bankruptcy code where we are only able to recover payments over a two-year. eriod rather than a six year period and that will have an impact on the recovery effort and the ultimate amount available. david: to pick up on your question as to whether the industry will be affected, i believe it will be, not just the brokerage industry itself.

there has been a very broad interpretation of section 546 b of the bankruptcy code, originally created to deal with buyouts. it has been expanded to reach commercial paper and write into our case where there were transactions. the literal application of the statute is so far-reaching that now, we are finding that that was -- it often happens with congress. they went into this thinking ever going to solve a problem and, in effect, they have created another issue. scarlet: got it. this is a question for both of you. hbo and abc are producing their bernie madoff story. who would you want to play you in the retelling? david: george clooney. scarlet: of course, i see the result wa. think paul giamatti, he of wonderful actor in many great roles. scarlet: paul giamatti, the call

is out. thank you so much. david: thank you for having us. scarlet: irving picard and david han on bernie madoff and the payoffs to customers who lost their money. getting rid of your 401(k) plan? tony james will be joining us live next to tell us about his big plan to save big for your retirement. it may not involve any more 401(k)s. ♪

welcome back to "bloomberg market day." we are going to head over to europe where ryan has the latest from london. update us on how the european markets are doing. it's a battle between the

green and red and geographically speaking it is even right now. the majority of the bowls are optimists and concentrated there. i want to take you to italy because we hear ferrari, fo ferrari irving, . can see the you shares are down, one of the worst performance in milan today. some people out there thought may get arrari better price than it did. fiat chrysler is a direct beneficiary of the price they got in that. i couple of people think that they would like to see a higher price going into today's trading. one other place we have got to go today is switzerland. the reason for that is we did hear from the new ceo of credit squeeze this morning, announcing for restructuring,

including the universal bank. investors are not certain. one of the worst performers in switzerland today. take a look of the stoxx 600. overall speaking, we are pretty much where we were yesterday. nobody really has too much conviction in the market right now. tomorrow, we are going to hear from mario draghi and company. that press conference coming at 1:30 p.m. london time. he will be speaking in malta. everyone trying to learn his position into more qe. they are staying on the sidelines until then. just axx 600 is down tad. that is the benchmark for european equities. i've got to leave you with this. this is one of the world's largest producers of chemicals for the agricultural sector. the market closed yesterday, before the market opened today, we learned that the ceo is going to step down. his name is mike mac. what did shareholders do?

they said, good riddance. they applauded him. it's one thing to say you are quitting and it's another when your shareholders rejoice in the action. why were they so displeased? he lost in takeover talks with monsanto. they like the news that he is going to leave. chilcote, thank you for the latest on what is going on in europe. in the meantime, we want a check of the u.s. market and we check --with abigail the little too little. you are focused on the chip sector. abigail: actually, we are looking at other stocks today. we are looking at mixed markets. the composite index open slightly higher. it was down almost half a percent and we are flat. have a lot going on, including the chips. i would like to first talk about yahoo!. the internet media giant reported third-quarter earnings yesterday after the bell. disappointing on both the top and the bottom lines.

they also got it down for the fourth quarter below analyst expectations. on company gave its update its stake in the alibaba spin off, saying it is likely now to happen in january 2016, a little bit later than the initial target of later this year. one bright spot is that they did announce an agreement with alphabet, also known as google. all of this was not enough to shares from ang neutral to abide. still overweight and he even raises his price target to $33 from $32. the stock fell about 4% are not. still getting over to those chips that you were talking about. it's a story we have been talking about all week. sandisk and western digital. western digital did announce plans to acquire sandisk this morning for about $19 billion. this would put western digital firm in the space of giving it access to a conductors in the eeart of a fast-growing typ

of computer storage, as it tries to offset weakness in its core space. it is a year that is shaping up to be the biggest for m&a in the semi conductor space. both stocks are up at this time. scarlet: abigail do litter, thank you so much. in the meantime, it is time now for the bloomberg business flash. it's a look at the biggest business stories in the news right now. we begin with biogen. it is cutting jobs. the massachusetts-based company will/11% of its workforce and shutdown more research programs officials say the restructuring will save about $250 million a year. pharmaceuticals wants to raise about $7 billion in its stock sale to pay for its deal. that is according to people familiar with the matter. they are buying the generic drug business and the stock sale is plan to launch next month. bravo lake partners and, foreign half

million dollars from solar winds will sell at $10.60 a share. that is where the company closed and that is before and the news emerged that the company was in talks to be taken private. moren always get business news at bloomberg.com. let us switch gears here. imagine a world where elderly poverty rates reached levels not seen since the great depression. you are not alone. blackstone has a plan that does away with lower term 401(k)s and replaces them with gra's -- what are those? guaranteed retirement accounts. mandate 3% from workers and employers and the federal government would guarantee a minimum 2% attempted they would invest in long-term plans. betty liu sits down with the ceo , tony james, in washington

right now where he was speaking at a center for american progress event. betty: thank you so much. to see you great today. i know that you just came up of the panel and i was reading through some of the points. scarlett was mentioning gra's. how are we going to fund this? tony: the minimum of 2% does not cost anyone anything. goering team 2% has no cost essentially. charge ant to insurance premium, you can do that. that's for the first few years only. remember -- this is someone who puts money in every year, year and and europe for 50 years. betty: you start early. it's mandated right? tony: every year, they put 1.5% thearnings and, largely by $600 credit. employers put the money in and of the cumulative time. that money will be invested and

invested well. it should earn 7% to 8% a year. a minimum 2% promise of a return -- >> guaranteed by the government. tony: should not cost anyone everything. scarlet: how can you guarantee that, tony? tony: there's no certainty in life. i agree with that. eriod ofong enough p time, it's almost a certainty. if you want government bonds, ukip on that. scarlet: not lately. why is this important to you? tony: why is what important? scarlet: talking about retirement prices important to you? tony: i think it is going to be terrible for my kids. none of them are going to have the kind of retirement security in that generation that our parents generation had. we are somewhere in between. you go back 50 years and most people in america work for big companies that had pension plans to two things happen. companies do not get pension plans anymore.

all they do is defined contribution plans and 401(k)s. people are not even working for the companies. they are working for entrepreneurial things and are independent contractors could they don't even have that. path, embarking on a which is slow death and away. no one is going to realize how bad things are until they are close to retiring and then it's too late to do anything about it. scarlet: are you basically suggesting that americans do not know how to invest, how to take care of their own finances? maybe they have been scared away by the markets and what has happened in the past two years? tony: i think what i'm suggesting is that americans do not like to say or cannot say. middle-class and below that have had stagnant incomes for 40 years and have student loans and have rising health-care costs and every thing else, it is hard to save. one problem is that we just don't save. a better jobs do

saving. we are not great at saving. why should these people have the expertise to know how to invest? if they're going to earn a very good return over a long-term, they need to do not plain vanilla things. they cannot just put it in a savings account or by government bond or mutual fund. those kinds of investments will leave them with a long-term return of thre 3% or 5%. they need to do better than that. scarlet: to play devil's advocate, if the government is going to mandate a minimum of 2%, blackstone could benefit from this, right? you put that money into blackstone and they get all this money flowing into their own fun. our clients are institutions and not individuals. let's face it. if there is more savings, there will be more asset managers of all sorts. black stone is one of them.

-- the answerto is to not have old people poor. betty: to have poverty rates among the elderly. so let's speak a little bit about blackstone and business. we just saw on the news one of the biggest property deals in new york city. how important was that deal for blackstone? tony: i think it's a remarkable achievement, friendly to do that deal that no one else in the world could have done. scale -- $5.5 billion, which is huge. not many people could write a check for that. it's very complex. we needed to work it out with the city and the tenants and the city council and the government and senator schumer, our investors. multidimensional, highly converts transaction. maybe no one could have done that.

especially with the speed and scale that we did it. number 3 -- having patient capital is essentially permanent capital. we do not have to try to squeeze the last juice out of that limit. we could be very patient and very responsible as a landlord. we can guarantee 5000 units and almost half of the units are for the housing. betty: was that key to getting the deal? tony: totally key. and it's a wonderful benefit for the city. if the city were to build new buildings to replace those affordable units, it would cost billions. betty: and you are comfortable with the price paid for it, not too much different from 2006? tony: not too much different from 2006. we will earn a responsible return and it will be to the city as well. betty: what is that type of deal and that there is such a huge demand for real estate? what does that tell you about the economy? tony: i think the economy is doing pretty well.

i know people are worried and i'm not sure where the worry is coming from. what we see in real state of all sorts -- betty: and you're talking about the housing data. tony: mostly multi family. we see all sorts of real estate in the united states. we see once going up and we see incomes going up. people are using more real state and there are more buildings. the building is exley good because it's creating good construction jobs. betty: you just set a moment of that you are not sure what people are worried about. it seems like the economy is doing well. it's well enough -- tony: it's not growing like a rocket ship. it's like a tank. betty: its study. tony: it's not going to go fast, but nothing's going to stop it. betty: steady and solid enough that it should be raising rates by about this time? tony: i think the fed raising rates is way upper bound. i think how they raised rates in quarter of a percent in

september, it would've been fine. they didn't. it's fine. i think almost now that people want to see the rate start to go up because they are tired of anticipating it. they just want to get that done. they are only talking short-term rates. i do not think it will make much difference. betty: talking about short-term and this is sort of the theme of this conference, to try to get people out of the short-term thinking into the long-term thinking. we are here in washington. you want to talk about short-term? theain what is going on on hill. you are very involved yourself in politics, right? not as like to think politics but as helping the country. first off, to hold pending fight over the debt limit. how devastating do you think that is going to be for the economy or is it? tony: i think this will play out like before. i do not think at the end of the day that too many people down here are truly suicidal. betty: they have done that a lot

of times, too. this country obviously is going to pay its bills. at the end of the day, i think frankly the republican party, when they realize they have more to lose, will reach some kind of accommodation. you have been in the press very supportive of president obama. are you just as supportive of candidate clinton? yes, i am supporting -- am supporting hillary for the election. i think she will be a good president. betty: do you have any interest at all and government? either the best job in the world. betty: do you like what you're hearing so far in the clinton campaign? do you like what you are hearing about economic policy? tony: they came out with a new set of regulations that are

related to the financial services industry. generally speaking, i thought it made sense. i did not love every part of it. what gets people like me a being used as a political punching bag. think secretary clinton came out and talked about shadow banking. shadow banking sounds kind of nefarious and sounds like you are trying to run regulations and do something lurking in the shadows. isnt of fact, shadow banking really just market-based. it is where the bank selloff andts on the balance sheet creating lots of leverage. they sell it to investors who could own it. it's a safety mechanism that disperses risk. financesn the american are much started in europe. betty: thank you so much for joining us. tony james a black. that to you guys. scarlet: thank you so much.

i want to get to julie hyman for some breaking news on carl icahn. he is very active in putting some money together. it looks like details are coming up. be forming al super pac within an initial commitment of $150 million. icon says it is a no-brainer for congress to pass a highway bill as well. letter whereed a he is making a lot of different political comments. he says that it's going to focus on the affects of corporate tax inversions. that is really the target of it. he is concerned of corporate tax inversions of companies leaving the united states. he does plan to raise a third-party fund as well. other comments that he is making is that the fed has kept rates too low for too long. scarlet, when he talks about this, it's interesting. when you first see the headline, my assumption is that it would be in some way to support donald trump, because yes talked about his endorsement.

yes talked about the need to keep money and workers in the united states. this would seem to be in-line with some of trump's campaign platform. scarlet: instead, it has to do with stopping corporate tax inversions and companies from leaving the u.s.. carl icahn making some comments about the u.s. economy being fragile and not a position to do much. thank you so much, julie hyman, for the latest. to theto head over bloomberg radio studio where tom keene is speaking with angus deaton. ,e is of princeton university as well as neil ferguson. we join them now. good morning everyone on bloomberg television and bloomberg radio. tom keene here as we talked to angus deaton of princeton .niversity professor deaton, first of all, congratulations on your award. what want to talk about fundamentally is what it was like at the university of

bristol when you did so much of your formative work? you have the courage to go against bell curve and aggregation. you have the courage to go against the macroeconomics of the time. what was it like at the university of bristol 40 years ago? angus: it was terrific. i had a lot of good people who worked with me, a lot of inspiration. i do not think it took a lot of courage. it was just following my nose and doing curious things, that seem to be interesting and things that might pay off. tom: it is common understanding now that inequality and pushing against what economists call aggregate analysis. what you did that was so original is say that the individual and the household are micro economic matters. give us a sense of your first papers on what you study about individuals. angus: i think what happened in much more intond

the 70's was the government started making available the household survey data and the individual level data that we did not used to have before. that was very exciting to try to work on that and the methods that we had worked very well. alongis a real feeling with a bunch of other people and we were having a lot of fun trying to find out how you look at individuals and how individuals can together to make the macroeconomics. tom: it is something i tell folks all the time of the data always being there. it was not there until something like 1977. as had to move forward professor deaton talks about. i love this phrase because i said it at school. carefulness of measurement. what is carefulness of measurement? angus: well, it's being suspicious. it's not taking the numbers -- we call them data, which means they are given.

a really are never given. they are put by someone with some purpose in mind and you want to be suspicious. you want to be careful and crosschecked. you want to triangulate. you want to make sense until some story behind them. all that is carefulness. it is not taking these numbers that the data has given, but trying to pull them off hard. tom: i think of william easterly from new york university being quoted, "what is wonderful about deaton's work is that there is no agenda." you came out of scotland. i have to deal with angus deaton and now i have to deal with neil ferguson. it is a scottish hour. how did you get to a point of no agenda when anybody within a lose second -- anglo-saxon economics has an opinion? accidentthink it is no that the living british-born

economists who are laureates, both of us are from scotland. tradition ofg thinking hard about money in scotland. tom: very good. let's talk about the item most acclaimed within your award and that is inequality. theeems to the widening political debate in the united kingdom and the political debate in america speaks of a new kind of inequality. what is different in 2015 from your seminal paper of 1980? angus: i think it has gone on. there is much more to worry about now than it was then. it was sort of the beginning to start. there has always been an equality. there was inequality a long time ago. now we are going through a phase of rising inequality. aparting that delights me from the prize is that this will help push inequality even further into the debate.

i've been interested in inequality all my working life, but it has not been a central topic in public debate. it's wonderful. i think the fact that there is not really the point. i think that both sides in this debate have valid points to make. we have to find what is the ideal level of inequality. we have to have some inequality, but not too much inequality. we have to struggle to figure out where to be. tom: neil ferguson coming on. and professor deaton's book, and constant theme across what professor ferguson writes about is that the rich get to write the rules. it reminded me of angus madison and the idea of our inequalities going back through all of western civilization. prescriptioneaton to narrow the inequality of income or inequality of wealth? lots of think there are

possible tools that we have if we want to use them. i think this is a lot to do with political questions, which is why the debate is actually so important. that is the debate that we are having. be veryction will important for where people come out on that. fore are plenty of tools inequality. there are lots of things that we could do. the question is whether people want to do them. it is whether our political system can do that. i do worry and i think the phrase that you quoted about worrying about the rich writing the rules. i do not think we are there yet, but it's something to worry about a lot. tom: you were an eisenhower professor at the school and institute of princeton university. those names carry an awful lot of weight. with the idea of the policy prescription that is required,

are we searching for a policy prescription within a modern plutocracy, a modern gilded age such as woodrow wilson reacted to in the early part of the century? exactly think that is where we are and i love that analogy with woodrow wilson because he opposed inequality when he was president. the rich people that ran the university ran modern rail and went off on the president of the united states. woodrow wilson was far from an ideal president, but he did things to tackle inequality and had a mandate to do that. maybe that will happen again, maybe it won't. a lot of what we are seeing now happened 100 years ago. tom: professor deaton, thank you so much. the most recent nobel prize winner, angus deaton again, the e eisenhower professor could we

. we now move onto to another scsi. was that fun was aiming to -- listening to deaton? neil: one of the interesting things was him becoming a historian. tom: what is in the air in scotland? i go to attenborough and think of the wonderful buildings and that is that run down monument there. what is it about scotland that delivers a deaton or delivers a ferguson? neil: i do not claim to be in the same league as angus deaton but we would both agreed that scotland was one of the great intellectual events of all history. it produced a great deal of both economic history and economic history in the person of adam and david hume. although not much survives of the enlightenment in scotland in 2015.

there was enough around when i was getting my education to inspire me to want to study. you bute seen more of in heathrow luggage. we are bouncing off of each other as you go on this tour with this acclaimed book. i love what they said in "the new york times" about henry down and being broken there is a revisionist theme and i love that concept. when you are writing kissinger, was there a feeling that you are setting the record straight? niall: that is what i always set out to do. this was a book inspired by a subject, henry kissinger himself. he clearly felt the need for a scholarly biography. i agonized on whether to take on such a difficult task. one reason i thought i should is that there was this mythology that had sprung up inspired by

the likes of seymour hersh that he was the dr. evil is not darth vader of the late 20th century. it seemed implausible the way that he was being represented. critics represent him as a machiavellian figure. i thought that was a bit derisive. i even call him in the biography of an american machiavelli. once i read at his private letters and diaries and published and unpublished works, i quickly realized this was all wrong. at least in the first half of his life, he was much better described as an idealist. that sounds pretty of yourntuitive to most listeners, who probably cannot imagine kissinger as an idealist. when he realized that he was by turns of refugee, a soldier, a nazi hunter, a student of philosophy and history, long before he became national security advisor, it starts to make sense.

tom: you and i have talked about this before about how he came to america. what we are observing that the scale of refugees and economic migrants in europe, how would you presume she was formed by ,ow he came to america literally escaping the threat of the nazis in the late 1930's? niall: today, the refugees are pouring into germany and then they were pouring out of germany in the 1930's. the kissinger family were amongst the lovel lucky ones to get the united states. there were quotas on the numbers that could come here. henry kissinger arrived here as heinz kissinger in the late summer and early fall of 1938. in a remarkably short space of time, he became an american citizen. six years later, he found himself back in germany as a g.i.. in the letters he wrote home to

1945 andts in 1944 in in postwar germany are some be most astonishing documents. tom: just read this book. read the whole book obviously. the basic idea of the first 80 pages, they literally read like a movie of the niall: young henry kissinger. it's a very dramatic story. you have to imagine that he not only participates in the battle of the bulge, but a few months later, he is in the deliberation of a concentration camp. tom: what was his reaction to that? niall: a very stunning one. he wrote a very short essay in response to the experience, which takes the form of an address really good it's to one of the inmates, a 16-year-old victim of the nazis. it's one of the most striking documents in the book. i think it is the first clear sign of the passionate idealism that motivated the young man in

what became a crusade against utilitarianism -- totalitarianism. with hisre here outstanding kissinger 1923 to 1968. there are sharp reviews pro and con and a lot of debate. have you begun the second volume yet? niall: i have. i've done a lot of the research. tom: is he is evil as detractors say? do you call it 1968 to the present, the evil one? niall: i think i'm going to call it the realm of power. i think the key difference between being at the wrist and a professor and being a national security advisor and secretary of state is that you are in the realm of power. few academics do this and most are content to sit in their studies pontificating about policy, but when you exit entered the realm of power, you find that your idealism must be compromised, not least because you are working, and kissinger's

case, for president next him who had strong views about foreign policy. it seems to be an unhealthy one in this discussion. tom: let me stop quickly. i love this quote we found. he is quite a sight as he struts back and forth across the lecture platform, alternately praising and castigating kennedy and tossing words to kissinger. the evils beset our foreign policy. that was written in 1963. it could've been written in 1993 of dr. kissinger. niall: the difference then is that he was an academic. he was basically in the kennedy administration and had a terse -- first taste of foreign policy them. that is why when he was still a professor at harvard, i still think that he had to fully appreciate the realities of power. that would be a big theme of the second novel. tom: we all live differently --

the vietnam war. there are talks about it and the important thing is that 1968 was not the end of vietnam war and did he have any illusions that could have ended vietnam earlier? did he know and 63 or 64 there was a need to move on from vietnam? niall: absolutely. one of the most exciting things in the first volume is the realization that kissinger knew as early as 19 65 of the war cannot be won. there would have to be a diplomatic exit for the united states. he was working actively for that already in 1967, trying unsuccessfully to get the north vietnamese to negotiate. the notion that he could just sort of switch to switch and end the war in 1969. richard nixon could've done that. i think that is not historically plausible. one has to ask the question -- could that somehow have been ended sooner? the north vietnamese were extremely tenacious and very determined to ultimately conquer south vietnam.

it was not as if they were ready to negotiate in good faith in 1968. tom: it's on the list of five books that every kid must read. you have to go through. of dr. kissinger, love him or hate him, he speaks of that time on the road to despair. he does not see micah a guy who easily goes on the road to despair. how did you walk that road with lbj and onto richard nixon and on after that five years after the war? how did he walk that road of despair? the diaryyou read that he wrote on his first visit to vietnam, you see the beginnings of the road. kissinger realizes with the shock just how badly the war has been waged, how different american agencies are falling over one another, and how the south vietnamese government was chronically corrupt. i think that is the beginning of the long road. ultimately, there is no way. there was no way.

to get the united states out of vietnam with honor. to his credit, it was simply the fall of saigon. i cannot say that kissinger did not try and try sincerely. that cameration o in age in 1968, the baby boomers, it was an conference call that he and richard nixon sought to use force to try to achieve peace. this is one of the keys to the story. a huge generational gap between the men who had fought in world war ii and the next generation that came to college in late two 1960's and early 1970's. that would be the big theme of the second volume. it is striking how quickly he lost illusions about the world. that is turn the following weeks were to travel around in the hair-raising locations held by the vietcong. tom: could he be a quickie -- could het to be

possibly want to be secretary of state in 2015? niall: i think in 1992, he would be the first to admit. tom: he could do it. i was with him six weeks ago. at 92 years old, he could do it. niall: there is no question he has astonishing energy and thought power still there. the one considers difficulty of u.s. foreign-policy and 2015, there would be nobody better equipped to reformulate our strategy in ways that would regain the initials. we face three huge challenges -- the rise of extremist islam, the surgeons of an insecure and unforgettable russia, and above all, the rise of china to be a real economic rival to the united states to right now, i do not see a coherent strategy for dealing with those challenges. and his recent piece in "the wall street journal" shows that he has a better grasp of the strategic problem. it is the three-dimensional chest of foreign policy. tom: i spoke to him at length about this. there was an off the record

conversation and i'm going to respect it from dr. kissinger. i sentsclosure, folks -- to read this book cover to cover or you do not get any money. i do not know if i can say that about kissinger. the kits will not read the length of your authoritative effort here, but the basic idea of world order is the most interesting foreign countries in it are the united states of america. he literally writes about our andon as a different nation search of strategy. what would you suggest should be that strategy? niall: a recurrent theme of kissinger's work going back to the early days is being the inability of the united states to consistently pursue a strategy. partly he says because they lack of historical knowledge that is endemic. he callscause of what the problem of conjecture. the problem of conjecture says that if you do a difficult thing up front to preempt the disaster, nobody is grateful.

nobody is grateful for never to disaster so therefore it's an attempt to play the time and kick the can download. that has characterized our policy since the so-called arab spring began. when itplayed for time comes to syria. the longer the president has waited over these four years, the worst the situation has got. it seems to me that the crucial -- ands to try to stop this is a point that kissinger made in his recent op-ed -- to stop isis getting more powerful . tom: and he was right for isis against all the factors. nial to allow the islamic state to become a more prominent islamic state would be an absolutely catastrophic foreign policy error. we are terribly close to doing that because the airstrikes have not degraded their ability. it now control substantial tracks of iraq and syria. that should cause's for your listeners on bloomberg, tom because the instability of the

entire region is in play. saudi arabia is in many ways vulnerable to the rise of extremism and it would be a very, very crucial target for the islamic state. it has to be on the list, the holy places. tom: the kissinger critics talk about bombs on the ground. in writing this book and working on the next volume, what did you learn about his statecraft and boots on the ground? that is the phrase right now. tsme suggest that the booo need to go to turkey first before the middle east. what did henry kissinger think? niall: the recurrent lesson of a mechanistic is that you cannot get everything from the air. ofsinger has the advantage the most intemperate decision-makers and that he was one of those boots on the ground in 1994 -- 1944. tom: and there is no substitute for that. niall: it is critical to

understand that his attitude toward war and use of force -- that generation that fall the world's worst conventional warfare had a very different view of what could be achieved. it is certainly not possible, i think, to imagine the solution to contemporary problems that can be achieved solely by the use of unmanned drones. sometimes i feel as if that has become our solution to the problem posed by islamic extremism. this president has carried out drone strikes in pakistan. the effect certainly does not seem to diminish the appeal of islamic extremism, but quite opposite. tom: what can john kerry get out of this book? he is a little overworked. he has probably got some airplane time to look at your book. what is one thing that john four: i think there are

key lessons this book has to offer. the first is coming definitely history. more historical expertise, please. no more of this, we don't need george cannon right now. most of your choices are between evils. there are seldom nice options. tom: the book is "kissinger." good morning. emily: thank you so much, tom keene. on had naill ferguson. let's go to julie with breaking on valiant. julie: it remains low. it is the biggest drop since 2006, down more than 24%. it has fallen as much as 28% today.

the volume is about 11 times the one your average. all of this, on a report coming out from citroen research that ask for this be the pharmaceutical enron. a report came out from the southern investigation on its website. a look into the company practices. it has to do with ownership of a specialty pharmacy company and eantgations of whether val is dumping inventory in these special pharmacies and reporting it as sales. it is not actually moving towards consumers. all of this is just allegations at this point. the new york times raise questions about these practices earlier this week as well. with this inflammatory language, it is fanning the flames. i think it is worth mentioning, the holders of valeant, like the

holder fund, the top owns 10% of this stock. owns 5%.r form we are seeing this spread to other biotech and pharmaceutical companies. it is a specialty pharmaceutical company. endo pharmaceuticals holdings taking a big hit in the session. it is down by 11%. it is following this trajectory for valeant. other specialty pharmaceuticals have been mentioned as well in the new york times. they're questioning practices. we saw horizon pharmaceuticals fall as well. allergan has hit, come up a bit. they do not use

specialty pharmacies in order to sell their drug. allergan was- already lower after they said they were selling to fund an acquisition. it is a fascinating story. it is a ripple effect. we are trying to get comment from the company themselve reporter: i want to head to vonnie quinn for the first word news. bonnie: thank you so much. we start with carl icahn, he is putting his money where his politics are. he will form a super pac with a commitment of $159. $150,000,000. house speaker john boehner says

he does not know if congressman paul ryan will run for speaker. he will back him if he does. boehner says he will have an announcement tonight. >> i was going to get the support he was looking for. he laid out a vision of how he would run a speakership. i thought the numbers responded well. he works hard, he is bright. he has good relationships with all of the people in the party. reporter: he wants to leave congress by the end of the month. president metna's with camera -- david cameron. blame chineseions steel for the loss of thousands of jobs. and brazil, the president is one step closer to being mp. a group of high-powered lawyers to decidea request

whether to go ahead with the impeachment. he's accused of doctoring government accounts. the european union is cracking down on taxes. chrysler is on top of the list. the automaker must pay $34 million in back taxes. given rules they were illegal tax deals by the netherlands and luxembourg. you can always find the latest news at bloomberg.com. scarlett: thank you so much. another story we are watching carefully is the emc dell deal. dell founder and ceo michael dell says he does not think it is doomed. emily chang set down with a titan at the annual leaders conference for his take. dell: i believe that the highlytion is of two

koppelman three companies. we become a leader in the current domains of i.t.. the servers, storage, virtualization pcs. we are also well-positioned in , visual of tomorrow transformation, converged infrastructure, the software combines data center, security, mobile. this is a powerful combination. we also bring together highly koppelman three market engines. emc is well-known for architecting solutions in the top companies in the world. dell has credible -- incredible reach an breath. emily: some say virtualization is a commodity. michael: virtualization is about software. one of the key aspects is dm where -- ware. emc's innovation has certainly

been much more software development over the last five or 10 years than hardware. hardware plays a role, but when you build these ultra-powerful systems there is in a more -- and norma's amount of software. you add to that the incredible vce, thisrom vmware, is a dream commendation. combination.am illegal -- emily: george looked at you yesterday and said that compaq took them down. michael: we spent one year working on this. we looked at it every which way. i am confident we are building

an incredible company. just af all you have whole different dynamic as compared to other big transactions. -- obvious differences difference is some of those other transactions did not have principles of the center -- at the center. i've think -- i think the overlap for the companies will work. this is not about combining existing businesses, there is a piece of that. posted together very well. this is very much about how we address the challenge and opportunity for our customers have any iger -- have any future . emily: how quickly will you pay off this debt? michael: i think what you will see in the first 18-24 months, a rapid deal of merging --

emerging. as we go through our process. we did this when dell went private. we are determined to take the steps necessary with both revenue synergies, cost synergies, the revenue synergies or three times larger to ensure that this company operates with investment grade policies. scarlett: that was michael dell speaking with emily chang. we have more coming up on what bloomberg market. yahoo! shows no signs of turning around their slowing sales. we will talk about what is next for marissa mayer and the company. ♪

scarlett: welcome back to "bloomberg markets." julie hyman was talking about shares of valeant pharmaceuticals getting hammered. they were looking at specialty pharmacies creating fake sales. they declined to comment on the report.

teva pharmaceuticals is considering a stock sale. up on theferrari are first day of trading at the new york stock exchange. the majority shareholder, cr chrysler sold a 9% share. >> the most important thing to me is i think we have treated shareholders in a way which i think was long overdue. asset that defines for ari pure automotive, perhaps it is a exaggeration. this is not really a car, this is a unique expression of art and technology. furry race almost $99 in their initial public offering. you can always get more business news at bloomberg.com. lessig a look at the european

market close. it was a mixed day. we will head to london where ryan chilcote is standing by. ryan chilcote: a real mixture of green and red. and evenly fought battle between the optimist and pessimist. you can see that geographically here in europe. most of the polls are in germany ls are in germany. the postal service that they would raise their prices stands next year. sharesy, fiat chrysler -- the parent company of ferrari fell by almost 5.5% today. why -- as you know, the price that the shares in ferrari went -- was to do two dollars $52. some investors thought they would get a higher price, then

when they did not get the higher price, they set the shares down. we need to talk about the stock 600. i said it was evenly split. we are ending exactly where we ended today. down 100th of 1%. everyone is waiting for the big announcement. the big press conference from mario draghi tomorrow will he will give us a sense of what he thinks about the need for more key -- cutie. -- qe. i want to set up -- show you syngenta, just before the open this morning you can see the shares down here. the ceo of the company announced he is stepping down. shareholders rejoined and set the shares of 6%. it is one thing to say you're quitting, it is another one everyone is happy about it. they did not like him because he had effectively balked at a takeover from monsanto. now they think there is a more

-- a bigger chance for a deal done the road. shares of the most in five months. scarlett: some parting gift. thank you. ands move back to the u.s. take a look at u.s. markets. we will check in with abigail doolittle with the latest from the nasdaq exchange and manhattan. -- in manhattan. : we have become positive index open down, then it went down, now we are up. there are two stocks on the move. one is a surgical company that put up a great quarter, beating analyst estimates on the both -- top and bottom line. the company reported that robotic technology procedures grew 16%. news,ors seem to like his shares are up 6%. another stock is micron technology.

this follows reports yesterday that intel is planning on entering the flash memory chip business in china. it will start making those flash memory chips in direct competition to micron. as a result we have seen downgrades, be of a to neutral -- b of a to neutral. all of this comes the background of a difficult year for this stock. shares are down as much as 63% from its december peak. today, down once again. that is all. scarlett: thank you. abigail doolittle reporting. it is insane with technology companies -- there was no silver lining out of yahoo!'s result. they're wondering if yahoo! will exist in the next year or two.

i think this company will probably be sold in the next 12-24. this is a soap opera that has gone on too long. >> i cannot figure out who buys it? scott: verizon, aol, one of the cable companies. scarlett: cory johnson joins me from san francisco to talk about yahoo!. what did we learn about these results? bristol myer, -- marissa mayer, as ceo is struggling with the company. johnson: this is a ceo who got to do what she wanted with the company. she tried to get expensive big names. couric to do a web broadcast show. they spent a billion dollars to buy tumbler. they bought a number of

companies. i talked to her last year and she said she was buying companies but she could not hire the height -- high-quality engineering talent fast enough. spend tens ofg to millions of dollars for every acquisition, just to get the quality of engineers she thought she needed. when we look at the financial results we recognize the copy is struggling -- company is struggling. the value per click is declining substantially. they are holding onto a big audience. they are getting more display ads. but click growth is slowing. that is concerning, you want to be number to accelerate. you really have to add a lot more business, just to stay afloat. yahoo! made the announcement about this deal with google on an agreement with

advertising search services to google. cory johnson: it is unclear. it depends on a scale to which they roll it out. yahoo! will pick certain search results from the yahoo! site, farm is out to google -- this out to google, the search results will come back to the yahoo! site. so will ads. the revenues will be split between google and yahoo!. the yahoo! users will not see it, but they are doing some searches on google. the yahoo! user will not know this, it could happen to yahoo! mail. it could happen on the yahoo! homepage. it could happen on yahoo! sports of finance. -- and by -- and finance. yahoo! makes a nod that this could raise antitrust concerns.

google is promising to cooperate with any questions raised about antitrust. yahoo! isshows that in the shadow of another company. scarlett: shareholders not necessarily liking that news. the shares went down more than 4%. coming up later, wells fargo ceo will be sitting down with eric on the outlook for bank lending out of wall street. a desk should be a great conversation, 3:00 p.m. eastern time reiki are on bloomberg television. ♪

scarlett: we are creeping up on new and here in new york. here is julie. julie: let's take a look at what is going on with stocks at the top of the hour.

the dow is the most positive of the three as we have several dow listed stocks boosting earnings. the senior equity strategist. we were talking about an issue about not too many folks in the market have been talking about. that is this debt ceiling that we are now once again approaching. the negotiations for this. you think there is a potential trade to be made on this. guest: it is a nimble opportunity. in past episodes in the last five years, we have seen kind of the same movie over and over again. very hard line publicans in the house stake their claim and dig their heels. things get down to the midnight hour and a rich -- initially -- eventually they raise the debt

limit. when people start to think about that, unthinkable risk, you see a bid for volatility. the vicks below 15, at looks like the market is not pricing with that at all. julie: does be short-term. -- this would be short-term. typically they come to some sort of 13th our agreement -- our agreement. i wanted to talk about trade today, it brings it back to earnings. skechers is what you're looking at, they are out with numbers tomorrow. we heard from wolverine earlier in the week, they had negative numbers. what is your outlook? jerod: this is more of a big picture call. reports this morning supported this as well, companies with a lot of international exposure are not having a backorder that investors feared they would have.

people worried that weakness in emerging markets in china would hit companies in the third quarter with a lot of international revenue. there are a lot of names with really heavy international exposure that have done well. gm saw robert margins increased and china -- profit margins increase in china. stock where it is today we are looking at 42-44 foot bread. -- spread. it gets you exposure in case the company --? julie: thank you so much. bloomberg market day is next. ♪

reporter: it is noon in new york. welcome to "bloomberg market day." ♪

reporter: from bloomberg headquarters in new york, good afternoon, i'm alix steel. here's what we're watching at this hour. plunging after a report saying the company is pharmacies to make their sales higher. we will speak with former treasury secretary, larry summers. shareskluster ipo market for ari going public. -- ferrari going public. for more on the activity, we will head over to julie hyman. again, not a lot of momentum.