and she is trying to revive it. welcome to bloomberg stephanie: i'm stephanie ruhle. we have a big day of bloomberg. it is the year ahead. summit. president obama himself writing a bloomberg view piece focused on tpp. david: the beginning of a campaign to get passage in congress. stephanie: this is a huge initiative. it is a huge initiative for us to a deliver you a very special morning. our d.c. bureau chief is in the house. i'm not going to say it is a huge deal p at i'm going to say it is a pretty good deal. a bloomberg favorite of mine is here. tim cook was speaking carried you'll have to weigh in on that

and a whole lot more. corey: big day. stephanie: news first. let's go to vonnie quinn. vonnie: a federal appeals court has daeealt a blow to president obama's plan to prevent immigrants from being deported. tates try to stop it. the states led by texas would probably end up winning the lawsuit. top maybe the supreme court. the senate is expected to pass a bill that would ban moving on, bay prisoners to the u.s. prisoners.12 most of them captured in anti-terror operations. congress would have to sign off on any new u.s. facility for the prisoners. david cameron wants to redefine the u.k. relationship with the european union. today the british prime minister called on the e.u. to make irreversible changes that would give the u.k. more autonomy within the bloc. thereminister cameron: will be those who say that what we are embarked on his somehow mission impossible. i say why? i do not deny seeking changes

which require the agreement of 27 other democracies, all with their own concerns, is a big task. but an impossible one? i do not believe so for a minute. vonnie: one of his main demands -- he wants to bar e.u. migrants from welfare benefits for four years. the u.k. will hold a referendum on e.u. membership by the end of 2017. you can get more on these and other breaking stories 24 hours a day on bloomberg.com. let's get a check in the markets. re seeing futures down across the board today. really a drop yesterday and drops across the globe starting in asia overnight, bleeding over to europe. if you look at the bloomberg terminal, wei, obviously is the command to get a look at the world equity indices. you see red across the board here. only a couple of green spots. the nikkei in ajapan.

concern about china's inflation numbers. worst on the street estimated. take a look at 10-year yield can read where seeing people run to the safety of government bonds for the first time in seven days. we have seen a rise for seven days in a row. now coming down but still at 2.32%. take a look at copper. the metal as dr. copper. we are looking at a drop here, the lowest since 2009 right now. actually cooper imports -- copper imports had risen into july the the have been falling, falling. there is a concern that a premium people play to store copper in china, they are not importing as much. the premium has fallen 4% in two months. take a look at that gap. equity stories today. this is accompanied whose same store sales were down 4% over

the last quarter. its banana republic brand down 12%. gap putting up a luminary s a share.f 63 cnetent big miss. shares trading down in the premarket. are under markets pressure after the jobs numbers given on friday which raise the prospects of the federal reserve will raise its rates in december. so we are bringing michael regan from bloomberg news to explain this because i am a little baffled. on friday, the markets to not move much at all. then yesterday, they fell off the cliff. stephanie: this is a matt miller special. david: they all are. stephanie: we did great positive news. some of the market feels like, well, the fed is going to remove the safety net. that is insane. michael: what is funny is how there is this delayed reaction. fridays the markets were not bad. then we come in on monday, and i think in the u.s., the company's and investors are pretty much ok

with the idea of a rate increase. it is overseas that i think is freaky people out, especially if you have been ecb loosening further and potentially the people's bank of china loosening. so, all which could potentially upt cause the dollar to go higher. treasury yields to go up higher. you wake up on monday and you see that the oecd had cut his global growth forecast to below 3%. it looks like brazil and russia are going to be in a deeper of a recession than we thought previously. so, in the u.s., there is not a lot of reason to get bullish about overseas for one thing. and domestically, as far as earning season, we pretty much squeeze everything we can out of the earning season lemon, especially apple, amazon, facebook, alphabet. really driving that rebound we saw since the summer. now the earnings are done. we are back to focusing on the international picture and the prospects of a rate increase

which may hurt emerging markets more than they would here. it is time to re-these levels in the market. and the market never got quite at that level that we were before the turmoil in august, anyway. it is back to where we were. stephanie: if you look at some of these big global companies, usa companies, they did not have great earnings. they did not have great growth. if you dig into fundamentals, they are ok, but what are their growth prospects? if things get more expensive, that is going to hamper growth. emerging markets is where you have heard so many companies say, that will be the next great venture. not so much. you're right. most companies, the earnings were not great. but again, it goes back to the companies that have been driving the rally in the last couple months. it is a handful of companies. if you look at the market on a sort of equal weighted basis, the rebound since the august lows was nowhere near as dramatic -- as traumatic.

corey: yosemite people boosting earnings-per-share. net profits. -- you have so many people boosting earnings-per-share. theales are down 5% for companies we have seen. you in asant to bring our washington representative. w whe you're in washington, you tend to think of everything as being -- is this a matter of the fed or is this china? yellen's jt's'janet ob? it seems perverse and the sense jobsyou see a 271,000 number on friday anything the u.s. economy is starting to push to the point where it has, asi six been for the past months, the driver of global growth. they continue driver of global growth. you would think that these are prospects we would look too. but you do get the malaise coming in. the china numbers to not help.

there is the issue of where we are going to be in china -- 6%, 5%? where's the opportunity for expansion for the namebrand companies? with fundamentals, we're going to have to see the earnings -- new growth. we have to see where companies can deliver if they cannot turn to emerging markets. and how a strong dolloaar will affect these companies. i think she has an incredibly difficult months ahead. if we do not see december lift off, will we see attention in the market? -- a traantrum in the market? >> in september, they sounded very dovish. and the market fell. the rebound from that volatility stated. october sounded more hawkish and the market rose. to some degree, the market is comfortable. it goes back to china and the inflation numbers disappointing this morning. it makes you wonder, what levers does china still have left to pull? one of them being the currency

which is what spooked everyone in august is so that is a delicate balance for them to strike in china. do they want to do what is best for their domestic economy and devalue the currency and free the rest of the world ou t-- and freak the rest of the world out? corey: context is important here where back to the levels of halloween. the s&p, every time it gets to 2100. there is a sense among investors with the memory of 2008, that they had terrific gains. one of the reasons you saw the biggest selloff in the last days of august, people recognize they had a fantastic run since 2009. there is money on the table. statanie: i read a great the fed raise interest rates, facebook had 1/10 the amount of users as myspace. bet againstg to janet yellen. i'm not going to betty gets her

book and hopefuls -- against republican hopefuls. thank you for joining us to her tonight is a very big night on the road for the white house. it is the republican presidential debate on foxbusiness in milwaukee. chris christie at the kids table. not on the made stage. this is the first time we are going to see less than 10 people at the big event. before we go in one word -- would you think is going to have a big night tonight? we have got kasich, bush, trump, carson. regan is going to impress some people. stephanie: now we are going to take a commercial break. megan: i am thinking trump. big and bold tonight in milwaukee. corey: rubio, can he to be going? rubio, a lot of questions that have not been asked of rubio. he's faced a lot of attention in florida for all his deals in the statehouse in the things that

went on there. he has not seen that nationally. he should tonight. stephanie: i'm going to go kasich. join the conversation. send us an instant bloomberg tweet. a big night tonight. who is going to have a big night tomorrow? everybody and china because it is singles day. one day away from the big shopping day -- not valentines day. buy yourself something. it is always singles day here. we are going to head to beijing next for global ♪

vonnie: here is your latest bloomberg business flash. u.s. expansion may have a few years to run. a 50% chance the expansion will last 10 years. the economy has been an upswing for 76 months, almost twice as long as the average recovery. new forecast says opec's share of the oil market will expand

after 2020 and prices will hit $80 a barrel. a predicts that production growth will slow down over the next five years. flight attendants at lufthansa are turning up the heat on the german airline expanding their walk up to cover the carriers entire german network starting tomorrow. anwhile,lufthansa -- me lufthansa has found a course to put an end to the strike. stephanie: now to some take you to global today we are heading to china were consumers and retailers are gearing up for its annual shopping festival known as singles day. vpily chang spoke with the of global operations to find out what the smartphone maker is expecting. good morning, emily. 11/11 is one of the biggest days of the year for e-commerce and china. as the third largest e-commerce company in china, we have to be ready. so we have prepared about 2

million smartphones so that we can sell them in one single day. stephanie: emily joining us now from beijing. this, help us put holiday into context? this is an invented holiday. an inventedis holiday, but you would love this holiday. this is a holiday that alibaba made up to encourage shoppers to go out there and buy for themselves. how does that sound? i'm here at front of the water cube where michael phelps one8 gold levels and it -- won 8 gold medals. that is where alibaba is kicking off the shopping extravaganza. in terms of numbers, $9 billion in transactions last year conducted on alibaba. they are expecting closer to $14 billion this year. so, it is a huge chunk of cash. warfs black friday and is

the biggest shopping day of the year in the world. corey: it is not just singles day. how do they stack up against some of the other cell phone companies around the world? alibaba is of course the biggest e-commerce company in china. i mean, it certainly dwarfs basically every other e-commerce company in this country. j.d.com is a major rival. but beyond that, you do have a company like xiami. we heard from the executive vice president of global operations isking about xiami which another e-commerce company. i was talking to him also about the smartphone market and how xiami have been jockeying for the top spot. take a listen to what he had to say about that. really matternot because we are such a different type of company. i almost cringe when somebody compares as with other brands

because we are an internet copy. we are happening at a different frequency -- we are an internet company. we care about different things. we care about engaged users. we care about users consuming our services much more than we care about somebody's buying one of our phones. stephanie: what are we expected from alibaba tomorrow? emily: the executive vice president. what are we expecting from alibaba tomorrow? first of all, they have been training a number of their merchants here. and they have been taking on thousands and thousands of temporary workers. customers have been selecting online shopping coupons. a lot of those will go into effect tomorrow. those deal will go through. you have 180,000 brick-and-mortar stores participating. you goin with your smart phone and turn it on and unlock certain deals. so, we are going to be watch the numbers as they rollin. we're going to be here at the water cube.

i'm going to be sitting down ma around 10:00 p.m. beijing time, about the time when they are starting to get the final numbers. stephanie: our own emily chang working overtime, anchor of " bloomberg west." be sure to catch her entire interview tomorrow new york time in the 9:00 am. hour. outel like day in and day we are talking about the depressed economy, but if you look at the power of singles day, man those consumers are out there. corey: a manufacturing quality. last year inat reading about the coverage, some of it was kind of fake. they took orders for days and days before they recorded the sales on singles day. singles day was kind of like singles week. it is worth noting that the company missed sales estimates last year. stephanie: you are buying it for

yourself. >> what are people buying? a car? what are we talking about? stephanie: not a volkswagen. >> i own one of those. david: we are going to turn after the break to wall street bonuses. taking a big hit this season. they will be coming up next on bloomberg ♪

david: welcome back to bloomberg wall street is bracing for a bad bonus season coming up. going to be the biggest drop we think in four years. what does this mean for the future of wall street bonus? it?la, how bad is >> i think the financial industry is starting to face a future where compensation may be a litte lower.

-- little lower. dodd-frank. a lot of companies have been forced to shrink, spinoff businesses, to get rid of the lucrative areas of trading. i think a lot of the workers are preparing for lower bonuses. stephanie: but it is changing the way they think. it is not that the money is not there. it is shifting from banks to the gubugyy side. there is no safety net. if you're going to bank, they never used any clawbacks, you're going to get paid win, lose or draw. if you had an interview -- an institutional seat, that was a million-dollar seat. you will have to walk home with a zero that year. people in the financial industry are not ready for that. in the world goldman sachs's the y train employees to spend more and more money. buy vacation homes. quit buying race horses. things have changed paired your better have a positive attitude.

so many young people are leaving banking and going to the start of industry for the positive energy. we had a guest on yesterday who talked about the biggest issue at the banks is retention, particular minorities and women. they're dealing with issues of retention because they cannot get these people to stay because there are great promises for guy buy side jobs. or going to work at uber. stephanie: senior people at banks are miserable. just eating crybaby soup. if you are 25 year old out of harvard as i've lived it. -- --everywhere you every year see the headlines, bonuses squeeze. at the end of the day, from the secretary up to the executive, the money is still big. the money is still there. it may be tied up in shares. there have been studies that show that does not matter. it is still lucrative.

people still want to do it. stephanie: from the outside it is lucrative. if you look in employee satisfaction morale is very low. i'm not saying it is justified. >> i have a tiny violin i would like to get out. david: some banks are doing better than other banks. i would not be sympathetic, my boss says might -- your bonus is gone. stephanie: we are seeing a change pay superstars are getting piad. aid. do not think it has ever been a career you pursue to, for personal fulfillment. stephanie: we have got more to cover. we are just getting started 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. stephanie: welcome back. you are watching bloomberg go. we are having a great morning because megan murphy, bloomberg's washington bureau chief is with us. and cory johnson, bloomberg west

editor at large. great to have you. cory: went to be here. time for the first word with vonnie quinn. ben carson will lead a field of eight in the republican debates tonight in milwaukee. he is at or near the top of the polls. sponsors are foxbusiness and the wall street journal. at 9:00 eastern fantasy for lower rated candidates will start at 7:00. lost anotherma has round in his fight to keep more than 5 million undocumented immigrants from being deported. a federal appeals court will not let the program begin. only six states fighting to derail the plan would probably win the case. it faces a possible showdown in the supreme court. black football players at the university of missouri will return to practice today. they demanded that university of lfe resigned. wo

he resigned yesterday. stephanie: thank you. it is time for this morning's must read. i want to bring in tom keene. he's on location in new york city at the bloomberg year ahead summit. good morning. tom: good morning. i know you are in the back room always in the restaurant here having their fabulous food. we are here the bloomberg event looking forward to the year 2016. i know you will be her later monitoring a panel. stephanie: today, bloomberg view has such a special piece we are not going to let you pick your own. brendan greeley is here. the president of the united states chiming in. i think he gets three dollars a word. this is a big one.

brendan: on november 5 -- this was last thursday. he had to release the agreement. he notified congress to let them know -- the tpp agreement. he's going to sign. here is his argument for the partnership at a time when 95% of our potential customers live outside our borders. this agreement will open up new markets to american goods and services. export support 11.7 million american jobs. exports support of to 18% of jobs. what i hear there is not a new argument. hardly. >> the piece reads very defensive to me. don't worry, jobs will be ok. stephanie: it's also about strategy. if you remember 10 months ago when he was first presenting,

before a word you got out of his we alreadyding tpp, heard from bernie sanders, op-ed, open letters attacking it they what it would do to the american people. president obama's problem was not getting his message out early. >> we have to remember how central he has made this is part of his economic program and what he wants to deliver in his final year. about asdon't hear much in this piece is how fundamental this is to asia and how important he feels this is strategically in terms of keeping america competitive. ist you see in that piece the feeling of addressing that concern that trade agreements see an exit of u.s. jobs and an influx of jobs that are lower pay, less competitive. i think he's trying to hit back at some of the retail politics around tpp instead of addressing

the loftier aspect. abouts is not so much economics as about politics. one of his biggest challenges is what the date is next year. it's 2016 which is an important year. tom: there's no question about that. >> i think we may have lost tom. this is all over but the shouting. when you look at the statements coming from sandy levin in the house, it's very clear their intent is to eventually sign it after getting as much out of this 90 day discussion as they possibly can. stephanie: as much political gain. this is done. we know this is done and it will be seen as the cornerstone of his economic plan. there are so many achievements he has had or we only will know

the impact in five years or 10 years. i'm told we have reestablished munication with tom. go ahead. what had struck me about the president's op-ed this morning is the way he brought in different constituents. detroit, small businesses. and critically he brought in people away from him. he needs a collegial effort here. as richard haass mentioned earlier this morning, he needs to bring republicans in to get this trade agreement through. the reach out here to the different constituencies is so important but you are dead on david weston. he is doing this in the crucible of an election year. my guess is if sooner rather than later so he can get the process out of the way. and the timing is interesting right after a very positive jobs number. massive this recovery we have seen during

this time in office. >> they are nervous in the white house. you have not just the bernie sanders but there are also worried about losing republicans from the right. stephanie: we will see tonight on the debate stage how this gets raised. where will we see people like marco rubio, jeb bush? most people have come out and set their stance. we are in this situation where there are members of the right flank that are being seen as anti-business the chamber of commerce very concerned about this. that is a fascinating dynamic. out is theps strongest labor and environmental protections ever. what does that mean? it has been a long time since we find one of these. environmental protections were not that significant 20 years ago when we did it. it may be stronger but what does that mean? the domestic regional economics are important as well.

agriculture probably benefits the most and that appeals to some of the states that are more rural. tom keene, final thought from you about how important you believe this is in the president's legacy. tom: it's a hugely important thing. brendan is better in the transatlantic agreement to come. but what's interesting is the combination of these two agreements. a global trade agreement when you bring the atlantic and pacific ocean in. the legacy part of this is tied to get this done and move on to a far more agriculturally fractious atlantic agreement. i would say one more thing which is that this agreement is coming with further declines in commodity prices. that's something to watch as we go to the end of the year and into 2016. >> the hardest thing to do in the eu at all is to get the french to give up their common agricultural policy. >> good luck. >> tom keene, thanks very much.

i want to talk about something else the president cares about and that's social media. stephanie: i think he's a huge snapchatter. >> these numbers came out and they surprised me a bit. 6 billion views on video. these numbers are incredible. >> there actually catching up fast and i was stopped by that. >> it's a fantastic phenomenon. if you listen to the conference call whether it is yahoo! or google or facebook, it's all about streaming video and capturing eyeballs. it has a very different effect on the user or consumer of content. the numbers from snapchat are simply amazing. stephanie: from an advertising perspective -- if you are snapshot business where you stand up and say, look at the

amount of eyeballs i have, time for the ad dollars to move it. n. do we have any idea where snapchat rate? s? these numbers put them among the most viewed content on any mobile device. it's pushing up towards you to -- youtube. >> the medium is so different. youtube made sense. twitter made sense to someone who is in print journalism. i went through the humbling experience of snapchat training recently and it was bewildering. either it's a completely new medium or i'm old or both of those things are true. it was thecrest said most valuable social media platform. i'm going, "what?" ?re you a snapchatter matt: i haven't figured it out. i think you need to be under the

age of 14 to get it. the white line is facebook video usage per user. the oranges google. -- the orange is google. we have long used google for access to video. facebook is finally starting to catch on and now there's a ton of video usage on facebook. this just shows how important video is to social media platforms. >> there's no question that this video streaming is growing exponentially. cisco comes out with a report every year. this is the number i would like to throw out. 2019 itject that by would take a person 5 million years to watch the video that will be put out in 2019 in one month. you sat down and watched all the videos coming out in one month, it would take one person 5 million years. that speaks to a lot of things.

it's being made by individuals. there's lots of content for people changing harley davidson mufflers. a harley davidson muffler repair show is not something that would have gone on a network. but there is an audience for that. that's why you saw the cisco erickson deal yesterday. it's all about taking computing from local places to mobile thoses and merging businesses together. computing is going into the mobile device and away from the desktop. stephanie: i said i wasn't sure about corey being here. i'm thrilled. brendan, thank you so much. we will see you again at 9:00. corey and megan, not letting you go. you know who is leaving the building? the killer whales at seaworld. no more orkut shows ins and diego. take a look at this. seaworld announcing they will be

ending their whale shows. remember the documentary that aired on cnn, blackfish? huge attention. blackstone had a very big controlling stake in this company for a long time. ons --ruly, it a big ocean conservation is. you were with richard branson for his ocean event. this is a big positive. but those killer whales back in the sea. at the future of nuclear energy here in the u.s. when we come back. stick around. you are watching bloomberg go. ♪

stephanie: welcome back to bloomberg go. i'm vonnie quinn. foreign retailers want to cash in on tomorrow china's single day shopping extravaganza. macy's and costco are among the

foreign change that will offer far brings -- bargains through alibaba. contact --roposed contract with ford woodward -- boost workers pay and bring production of pickups back to america. members would get raises and signing bonuses if they pass the agreement finalized yesterday by uaw leaders. another sign that retailers may be backing off the holiday frenzy a little bit. h&m stores in the u.s. will close on thanksgiving for the first time. it made theys decision after rolling out a new recruitment campaign after years of expanding hours on thanksgiving. many stores are now retrenching. and that's the news you need to know at this hour. david: earlier this month entergy announced it will be closing its fitzpatrick nuclear power plant in upstate new york. this is the third nuclear power plant shut down this year.

k's energy as a group pushing for use of nuclear energy. it's cochair former new jersey governor christine todd whitman is here. good morning. there's a sense that nuclear energy is a bit in retreat in the night states is that fair? >> i think that is fair with the low cost of natural gas. prior to the explosion of fracking you had consortiums with 19 potential new reactors before the nuclear regulatory commission and those are still there but they have slowed down. using newve reactors technology that should be online by 2020. it's not with the same push that we had before. stephanie: but they are still there. >> they are not dead. it got subsumed in the keystone pipeline decision of the president, but he also on the

same day talked about the changes they were making to allow for access to some of the money for research and development to actually be put toward the cost of developing the actual hardware for these new small modular reactors. thehanie: what should government be doing in your opinion in terms of nuclear? >> in general it would be nice to have an energy plan. it would be nice if we had a national energy plan. as far as nuclear is concerned, the new regulation, the way the regulation came out from apa at the end the day did recognize the importance of nuclear and allow them to count the new reactors toward their goal. get quite don't enough credit to the outsize role in nuclear plays in clean energy. form oft is the only base power that releases no regulated pollutants or greenhouse gases while it's producing power. toward a more

renewable future which eventually we will get there, you still need to have backup base power. stephanie: do you think people realize that? i feeling when you hear nuclear people still fear fukushima and say i don't want that. david: they fear accidents. and there are also concerns about the spent fuel and how that's disposed of. which is an environmental issue potentially. >> it is and it isn't. you have to start with what are we looking at and if you take all the spent rods from the 104 reactors we have had operating over 50 years and you lay them end-to-end you would fill up one football field to the height of the goal post. it's not something the size of maine. it also is not a gas. they are pellets. you can't use them. you can take a spent rot and stick it in a missile. they are safely stored on-site now. not optimal. they should go to one repository.

they are a lot less expensive than the big ones. they are probably -- a big reactor is between $7 billion and $9 billion. these were probably in the $5 billion category. hey can be moved on-site whole and put down. they have great potential particularly in areas like the sub sahara or in the middle of this country where you are not on the grid and you don't have access to power. david: you have something for us from the bloomberg. you can see we have disclosed or decommissioned nuclear power plants around the u.s. there are a number around the east coast. especially in new york. if you look at total nuclear

power production we are now at about 76 billion megawatts. this is a trend going down -- going back to 1994. it doesn't seem like it's really coming off that much. it seems we are pretty consistent over the past 15 years in production use. >> we are about 20% of the overall energy mix nuclear today. but it's over 60% of our clean energy and that's the thing that people forget. david: that's a tremendous change. i have also read that refreshing the grid itself is another way besides building more nuclear plants is a way to have more cleaner and efficient transmission of energy. >> the grid is going to need a lot of investment overall. even if you bring more natural gas. we will need to think about upgrading the grid. that's why the small modular reactors have such an attraction. they don't have to be on the grid.

they can provide power directly to an industry or small town. stephanie: thank you so much for joining us this morning. former governor of my home state, new jersey. christine todd whitman. we will be back with more with megan and corey in just a moment. this quote is something for you to think about. failure is success if we learn from it. that of course is from the late entrepreneur malcolm stevenson forbes. what do you think about that? send us a tweet. will throw that on my whiteboard and see how my 9-year-old feels about it. up next, he probably has more opinions about this. -- says cutting free snacks will save the ailing telecom company. 600 grand annually. can't believe snacks cost that much. what you are watching bloomberg

go -- you are watching bloomberg go.

stephanie: you are watching bloomberg go. i'm very excited to give a special quote. we have to have a correction. it was from the late entrepreneur malcolm stevenson forbes. we showed the wrong picture. that was his son. i really like the quote. take you so much for joining us, megan murphy and cory johnson. we will have a lot more in the next hour. you are watching bloomberg go. ♪

stephanie: turning it around. he has the monumental task of turning around the world's best-known bank. high drama at the high court. a supreme court case today could

lead to a landmark decision on class-action suits. $170 million pay for this? one chinese billionaire did. what he's getting for his money. welcome to the second hour of bloomberg go. i'm stephanie ruhle. david: i'm david westin. to johnto welcome tee sho tidjane thiam. -- there are now 112 prisoners in theba lkup.

most of them captured in anti-terror operations. cameron wants the eu to make your reversible changes. needs to cut the regulatory burden on business. the u.k. wants to bar new immigrants from getting benefits for four years. the u.k. will hold a vote by the end of 2017. riot police have battled migrants the last two nights in a french port city. migrants are in a shanty camp trying to smuggle themselves aboard trains and trucks headed for england. you can get these and other breaking stories at bloomberg.com. i'm vonnie quinn. matt: futures down across the board after a down day yesterday.

the s&p has been down for days in a row. today would be its fifth straight loss. we have the biggest intraday loss on the s&p in six weeks yesterday. the inflation data out of china is disappointing. oil was flown over the last four sessions heading into today. prices hovering at a two week low. little bit of a bounce here. $44 a barrel. but of course it's down 40% over the last year on concerns about oversupply. gold also has been down. it was down for a week in a row but was higher yesterday. it's back up today as well. it is still near its three-month low. take a look at a very interesting equity we are watching. is a pharmaceutical company worth about $6 billion. it was down 17% yesterday

because a very famous short seller mentioned it. citroen said this company has significant more downside than valiant. it sells a drug taken from the pituitary gland of a pig. $35,000 a vial. thank you for this morning's update. now we're going to take in. tidjane thiam is joining us. plans toannounced raise capital and cut costs and restructure. we heard from a swiss media outlet that you may be cutting bonuses as much as 60%. that's a big number. is it true? >> the short answer is no. that's a very speculative story and i will comment on that.

we said bonuses by paying for performances. bonuses are set at the end of the year once we know the outcome. stephanie: what's the message to your employees? it's the most read story on bloomberg. here in new york, you are new to the bank. what are you telling them in terms of what they should expect? >> i'm telling them to deliver a good q4. i think there are tired of hearing that. [laughter] into 1,rn a small digit 2, 3, 4. we are very focused on that. we have a strategy, a medium-term strategy. we have absolute profit targets. asia, switzerland, the rest of the world. we have clarified the capital issued. we are raising capital about $6 billion.

have taken capital off the table which has been a big issue for us and we have an absolute cost target by 2018. so at least we know what we're trying to to deliver. stephanie: i'm going to embarrass you because that's what they bring me over. you were the golden child. you came in over the summer. you are the guy that turned around credentials. how much pressure did you go into looking at this huge restructure? do you feel like you have delivered? do you feel you have been misunderstood or is it just a huge job? you are the messiah. >> you knew me a little. you know i'm always focused on the medium long-term. i'm not too worried about my short-term reputation. as bad as they say or is given as they say. i tried to keep a cool head.

we delivered by october 21 a new strategy, new targets, a new organization, a new team. in three months i think that's a reasonable job. francine: it's a huge job. and limitations but also details. -- whichlking about markets you want to play in. which clients you want to serve. what products. >> absolutely. euro banks is where the money is. why do we want to be in wealth management because the world is getting wealthy. if i had to summarize in one sentence, we're trying to do is -- the world is getting wealthier. you talked about a chinese billionaire. $3.1 trillion today. we are in the ultrahigh network space. number one the middle east,

russia, number two in brazil. stephanie: are you late for that party though? >> we're sitting at the top table. stephanie: why would barclays be selling the unit? there's basically two and anotherurselves company. which i will not name because i never given a airtime to competition. we are number one in southeast asia. it's a $2.3 billion -- it's a $2.3 trillion economy. we have been growing in asia. i only work for companies that really understand the place of emerging markets in the world economy. that's why i went to credential -- prudential.

sometimes i get calls -- sometimes i'm talking to a president, what should we did? we are very focused on emerging markets and asia and china. we have been underweight and we need to do more. we are very focused on the middle east. platform to and switzerland is the richest country in the world. and we're number two in switzerland. what about job cuts. we said about 2000 in the u.s. and that's what i like. -- one i like.

i was talking about cutting fixed costs which is a big challenge for banks. you can always ask people to do the same thing for less. you really have to change the cost structure. you take $650 million. in london we are going to offer about 1800 jobs. 6600 in london. in europesometimes and you look at your challenges, the challenges of the is that actually test we're not really giving ourselves a chance to have a big global bank? europeans cannot deal with -- they are trying to retrench. do you think you can still be that middle ground? as moste really lucky of our investments are here in new york. we have 10,000 employees in new york and we are very

well-positioned in equities. we have very strong leverage credit.and we have a really good investment bank. no one has ever denied that our investment was one of the most profitable. runsenerated very strong which is why in the restructure we have been quite vertical. -- surgical. they are very key to our main business. is illiquid.a that is what most market commentators miss. if you are in america in 1960, rockefellers and jpmorgan's and the middle class is still to be 400 that's where we are in most of the emerging markets.

we need to do is a bank is monetize that. you need the loan from us and the cash. a lot of people are billionaires in asia. what they own a real assets. buildings, roads, plantations, factories. we are turning that into liquid assets and you do that with an investment bank. that's why it's so important to have a very competitive investment banking business and -- a billionaire is only going to buy from a very good investment bank. that's where there is a disconnect. if you get your investment bank,

in five or 10 years you will have a private bank business. -- you won't have a private bank business. kathy from minneapolis asks what are your plans for a black swan event perhaps persistent deflation? how do you handle this possible overhang that the game may change? >> you always have to think about that. it was a very harrowing experience at prudential. we are raising so much capital to make sure we have a balance sheet that allows us to with stand a black swan event. that's really the starting point. unless you have a strong balance sheet you don't have a business. we are moving from possibly the bottom of the industry to the top.

that's very important and we are also very careful about risks. we manage exposures. it's quite likely that there will be a relatively traumatic event. stephanie: dramatic how? >> we had this long period low interest rates. it's quite likely that they will rise and there will be impacts in the real world. companyancial services we have to position ourselves quite defensively. stephanie: but you do think a big negative event is on the horizon? every time you see in markets when you go from a higher rate to a low rate justonment you experience people are caught unprepared.

people have not made adequate plans for that transition. the slippery to happen again. stephanie: we are so lucky you are here. so much more to cover. david: when we come back, we will continue talking with the credit suisse ceo. bloomberg go. ♪

david: we are back with tidjane the ceo of credit suisse. it was a difficult quarter for banks. there has been plenty of time to prepare for a rate hike do you think there will be followed? -- fallout? been very consistent and flagging what it is going to do and that's very important. all the central banks have focused on that.

i think september was a bit of a surprise. since then the statements have come out very clear. i think today most participants expect something to happen around december. the key element is not to surprise market. -- markets. example of what happened in january, what you discover is everybody gets into a sin trade. you get days locked october 15 when the treasury moves by more standard deviations and suddenly the market dries up. what you may have is a bit of dislocation as rates move. because some players in the market will not have anticipated -- and heprepared caught unprepared. francine: how worried are you

about fallout? it is still tough for emerging markets. you have to have a long-term strategy. if you think about emerging markets, the story is about productivity. modern technology in low productivity environments drive growth and none of that is going to change in the medium-term. and as a business person i see it as an opportunity. i don't like when there are 10 western companies competing in , i'merging market ve actually pleased that it is slowing down a little bit. it will differentiate between people have a long-term strategy in those markets and people who don't. we believe in those markets. that is why we are coming out with this growth plan. when you think about

emerging markets and a global selloff and you mentioned liquidity, many of these billionaires assets are illiquid. let's say those assets are backed by oil plantations or commodities that they can't get out of and its commodities continue to slide, you are not necessarily in a great business. there is a problem. i think that's emphasized by the central banks. -- if youompanies have a big important economy you have a huge domestic market. same thing in india and china. is itsuty of asia demographics combined with very large populations. you get a healthy growing domestic market. the average age in indonesia is 28 years old. stephanie: take us to the terminal.

bloomberg intelligence put together a really cool map that shows the sensitivity of these asian countries to a u.s. rate hike. the least risky in green. most risky in red is more of a mob on the scene. you can see that china and india are not as sensitive as thailand. australia is the most sensitive because it is a big commodities producer. bloomberg why is my high?o high -- bill so look at that great stuff. [laughter] >> what you saw since the temper tantrum is that it's a hot capital -- short term capital has been throwing out. we have very good quality of long-term capital going in.

i don't think you should judge these markets by a short-term. francine: how worried are you about china? trade data is terrible. this could be a game changer for a possible global recession. >> you have to look at what the chinese -- says. they move from the one child policy, that's a very important change for china. they talked about promoting health insurance and pensions. that's vital. the reason the savings rate is 50% is china is it there is no social safety net good people say it's because -- people saved because they have to not because they want to. you have to put in place a proper safety net. i like that they have a policy response that is correct. something i couldn't say about the eurozone. the diagnostic is correct and the policy response is correct.

shifting from an investment growth is correct. it's an execution challenge. at least they have the right policies. you saw this coming out of the central bank. francine: we are seeing more research saying the right policy for china may be following the fed to zero bound rates. this would be a vastly different world we would look at. think back to what i was saying about productivity. i went to china in 1984 for the first time. 31 years ago and i don't know anybody who has been to china when there was not a china boom. i think i called my family once. i was able to make one outgoing call in two months because there were no phones and no lines. you couldn't get off a train. i have seen china go from that to where it is today. i have seen the whole journey. and it's extraordinary.

they are the best educated. we were going to get in the next generation -- quantitative growth where people are moving from the countryside to the city. now you don't have qualitative growth were the quality of human capital that you are working with is significantly higher. the wires are connected to the world. they are hyper educated and that is a huge bonus for china. which i think the world is not taking into account. 10%a was not going to grow for it. i welcome the slowdown. i welcome the adjustment of expectations because it creates a healthy foundation. expectations at a reasonable level. ago was about 2

trillion of gdp. i don't really like percentages because they can be very misleading. it's always good to go back to absolute quantities and the contribution of china to the world economy remains very material. david: we want to include the audience in this discussion. user thattwitter asks, what about the euro versus the u.s. dollar? are we going to parity? looked always very and to make any forward-looking statements. especially currencies. i think it is the most difficult financial to trade. of --meteries are full where you have a bigger disruption everything is a currency. the macro, the micro, the politics. the world. i think long-term predictions in

terms of currencies are very risky. going to take a pass on this one. stephanie: i want to talk strategy. you are coming in from the outside. deutsche bank said they are going to cut back on client relations and focus on those that are more profitable. are you going to do the same? >> i want to talk about just ourselves. we are very focused on profitability. i think that's correct. we have done that. we have to take a break. we will have more on bloomberg go tidjane thiam. ♪ 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. david: welcome back to bloomberg go. we are still here with tidjane thiam. from credit suisse.

we will begin today with president obama's immigration plan that may be headed to the supreme court. a federal appeals court has dealt a blow to the proposal that will keep undocumented immigrants from being deported. the court refused to let the program begin. eu governments are admitting their policies on immigration are not working. new policies to deal with immigrants. so far only about 100 of the plans 160,000 -- asylum-seekers. half the oil from the gulf of mexico spill may still be on the ocean sure. hurts thedropped microbes helping clean it up. than $20 to pay more billion in fines to resolve the disaster.

matt: we were talking about malik wrote earlier -- malik mallinckrodt earlier. it's veryaid insignificant. and inexpensive. you see the shares coming down a little bit. rackspace posted better-than-expected. exoneco --in the xm

exone.p in you wanted to buy a massive insurance companies in asia and it didn't happen. it would have been an extraordinarily successful deal. what do you want to do at credit suisse? how do you make your mark and why do you have confidence that you are going to be able to do it? clearly that wasn't the case at -- >> actually if i may correct that. i was allowed to do what i wanted which was to drive in asia focused strategy focusing on the middle class selling protection positions. and when i propose that in 2010 it wasn't understood. the deal failed so i did it and it worked very well. i was able to implement the vision i had. stephanie: but had you done what you wanted to do it would have been even better. >> we will never know. it worked great wealth for prudential.

i don't want to gloat. -- it worked very well for prudential. i don't want to gloat. to serve our customers. we have a very clear vision. we believe in ultrahigh net worth for markets and think we can do very well implementing that. we want to reward shareholders. are generating $25 billion over five years and we will distribute that to shareholders and physically all of our stakeholders. and build a great team which is very important for me. but possibly the only thing i really do is building a team and managing and leading. this strategy so much because it's really the product of a team effort. when i said $3.5 billion of , we didn't start by

saving and then scramble. it's a bottom-up plan. we know exactly where that is going to come from and it is already executed. formulate it. you don't have to explain it to them they implemented. -- implemented. -- implement it. how big of a role does regulation play in the strategy? much of an overhangs regulation in terms of how much capital needs to be deployed and how much regulation still becoming? it's crucial. the ability to read the evolution of regulation has become a skill -- key skill. understanding regulation and have a strong relationship with them. he saw the debate in switzerland on too big to fail. that was really vital for us.

outcome ford industry and the customers and regulation. the gdp of switzerland is $800 billion. stephanie: did you just mention a competitor? >> it was a macro fact. imagine the u.s. gdp is $16 trillion. imagine if you are a bank that has more than $16 trillion on its balance sheet. jpmorgan has $2 trillion. they are in a very unique position and it's understandable that they want to make sure their banks are -- do you feel like you are on a level playing field with banks in europe? >> i think regulators are in close contact.

they have worked together and things are going in the same direction. it's all going in the same direction at various speeds in different geographies. the direction of traveling is clear and towards more capital. francine: diplomatic. david: you mentioned too big to fail. when does concern about too big to fail make you too small to succeed? you must discuss that with your board. what is the right size? >> my personal belief on that is really -- profit and capital generation. andbest source of capital this is what i tell regulators all the time is to be highly profitable. stephanie: i like that recipe. make a lot of money. >> you have to build your balance sheet for capital generation. i think regulators understand that if you look at how the balance sheet are being rebuilt.

a lot of that is to retain earnings. we have to be allowed to make money because it makes the whole system safer. especially in europe there is an excessively consumerist approach that once banks operate without making any profit. if you get to that point you get a very unsound system because they will have weak balance sheets. from of lessons were drawn the 2008 crisis. regulators have also evolved in their thinking. i think the next 10 years are really better than the last 10. he said he wouldn't make predictions or mention competitors. he's breaking both already. francine: if i'm an asian billionaire. why do i choose credit suisse and not one of your competitors?

makingtalented people sure you can retain at competitive -- >> look. one of the reasons is we are very good at equities. i talk about the liquid assets becoming financial assets. a lot of that is done through the equity markets. if you look at the market cap of most countries compared to gdp you see as a relatively low ratio and it can only go one way. banks that will win are the banks that are very good at equities. if you look at the names of the banks doing well -- francine: that's a little mark in business. -- low mark in business. >> it depends what you do. how do you communicate this to credit suisse? credit suisse bought dlj in 2000. one of the most capital intensive businesses. credit suisse is still paying

for it. equities wasn't a priority. what's your message to the organization where the cool kids are no longer the cool kids? >> it's the same message internally and externally. i invested on equities and white is keyed to go emerging markets -- if you go to hong kong or singapore, the business we do is amazing. at nine months we were at $1.1 billion of profit in asia. that business is really doing extremely well. they want to do with the best houses in the world. we are that. think about the slowdown in china. one of the direct consequences is that chinese companies have to go broke and that's a major -- go abroad and that's a major trend. i want to buy a company in europe. i'm very well-positioned. this is ai realize

catch-22 because all of the analysts were beating up your predecessor for not doing it. if we start a rate hike cycle than fixed income becomes profitable again. can -- you have to look at things through the cycle. confident that the portfolio of investment banking activities we have selected is robust and will generate good activity. we are closing down macro. of course if interest rates go to us ofare very happy those process -- profits. you have to look at things from a cycle and not on a quarterly basis if you want to set a strategy. stephanie: we have to talk technology for a moment. where do you see technology playing a role in credit suisse and the number of employees you have in the next five years -- will technology raise or lower that? >> i think it will have two factors.

in the short-term it lowers it and in the long-term increases it. it allows us to do more business in the long term because it allows us to move faster and provide better resources at a lower price. short-term it often leads to immediate job losses. as the company grows and leverages technology you will get more jobs and more people coming in. stephanie: it also cost you a ton of money. is your board prepared to let you really invest in technology gecko goldman sachs is the outlier. the have said we are a tech company. >> exactly. i have always believed that of goldman. my chairman is even more the technology believer that i am. involvement in that comes from the media world and he understands the world of technology. i think he absolutely understands that.

stephanie: what could we look at credit suisse and expense that you could spend in tech? >> it's a material number. we sent $2 billion of saving. 1.5eated 3.5 to make billion in the next three years and a big portion of that will be technology. i'm not going to say the number. that's commercially sensitive. francine: on the day that you gently him was on bloomberg tv in london. thiamthe day that tidjane was made, you were on bloomberg tv in london. stephanie: steve gorman is crushing it. he was a consultant. anncine: and if you are investment banker it so much harder to do cost cuts. we've taken a very rational

approach and those cuts that we have decided were proposed by the investment bank. they are being implemented by the investment bank. as a team we want to be successful. and we are doing what's necessary for that. stephanie: david cameron today is outlining what things would look like if great britain -- francine: i knew you were going there. stephanie: we have the governor of new jersey here for me. we are to mention david cameron for you. what things would look like if we side brexit. people really want to get your view on this given your position in europe. >> i believe it's in the long-term interest of the u.k. to stay in the eu. i have not moved from that statement and i believe in the long-term economic interest of the u.k. to stay in the eu. and i have a lot of faith in the pragmatism of the british people and i think that in the end that

will be the outcome. francine: the referendum is so unpredictable. it's so difficult to see what will happen. let's say something huge happens only you can leave slaton is that it for london as a financial center? >> that's highly speculative. it's a really hypothetical. francine: you moved headquarters. >> my headquarters are in zurich. francine: your london headquarters. >> we are a flexible company. we do what is necessary to win. in confident that the u.k. the end will make the right decision. stephanie: i have to ask one question. in terms of late -- regulation, if there is one thing you could change that is holding your business back, what would it be? there's so much complaining here about dodd-frank. what doesn't work for you? >> i think we just need to continue to improve the dialogue and explain what we do and make sure that it is well understood

by the politicians and regulators. we perform very important economic activity and it's important that it's understood. i understand people are angry and the emotion around that. but it's important to make the right choices for the medium and long-term. david: very statesmanlike. francine: i was going to say. stephanie: thank you for being with us. david: thank you tidjane thiam for being with us. next week look at the latest case before the supreme court on bloomberg go. ♪

david: the supreme court is hearing a case today that could affect class actions it's particularly making them harder to bring. hasmeat processing company been sued by its employees for unfair workers compensation. greg stohr is in from our washington, d.c. bureau. explain the divisions of this

class action. it's a lawsuit by workers at an iowa processing plant who say they were underpaid for the time they spent putting on safety equipment and walking two there their workstations are about 3000 employees in this class and a jury awarded them almost $6 million. david: so this is one of three or four cases that the court has taken on class actions this term. has a number of cases all getting a different aspects of it. some have to do with whether authorize people to sue even though they haven't actually been harmed by something and on that question is whether that can become a class-action as well. david: you reported that this roberts court tends to be pro-business. greg: it does. the courtse cases tends to be ideologically divided but sometimes it's even broader than that.

it will be six or seven or eight justices on the side of businesses. business wins roughly two out of three cases. this is something that business does not like. it tends to be very expensive and time-consuming. it allows individual plaintiffs and lawyers to bring very big cases that involve a lot of money. hear one thing you businesses sale the time as we have the threat of gigantic rewards and we are pressured to settle. once a court agrees a case can go forward as a class actions leaders a huge risk and we are under tremendous pressure to pay off the plaintiffs lawyers. that's the argument they make. a big articleas in the new york times last week about arbitration. have arbitration agreements with potential plaintiffs that preclude class-action and get out the courts altogether. greg:.

the court has been very supportive of these agreements mostly divided along ideological lines. there were a couple of rulings in 2011 and 2013 where the court said those agreements are enforceable even if that means that the person suing doesn't really have a viable way of in suching their claims a small case that no individual would bring it himself or herself and would only bring it as a class-action. court says you have to arbitrated then you have to arbitrate. david: does that mean you have less litigation in the courts than the tribunals? greg: it does. in day-to-day life whether it is the contract you sign with your mobile phone provider earlier employment agreement, all sorts of things where you might have thought if this goes bad i can see. -- sue.

people are being asked to sign claim so they don't have the right to go to federal court to agree does claims. stephanie: we've got a lot more to cover. here's a quick photo of a canyon on mars. it was taken by nasa's mars reconnaissance orbiter. what would you title this? hanging in your living room above your mantle? what would you call this? to me it looks like a whale. or to be honest, my daughter who makes things that look like this all the time. when we get back, we will talk more about art. a record-breaking sale at christie's in new york city yesterday to the tune of $170 million. we will cover that and all the big money right here when we come back on bloomberg go. ♪

stephanie: we have some big

dollars. last night, a chinese thisonaire purchased painting for a record-breaking $170 million. it's the second highest price ever paid for a work of art at auction. this is a former taxi driver. taxi driver turned billionaire. david: they goes exactly to what tee shot tee off was talking about -- tidjane thiam was talking about with all these billionaires. white will bejo with us from d.c. and priceline will be here. the ceo to talk about earnings on bloomberg go. ♪

david: we are now 30 minutes from the opening bell in new york and welcome to the third hour of bloomberg . stephanie: we are joined by

brendan greeley and eric schatzker is in washington, d.c. live. good morning. good morning, stephanie, david, brendan. is none other me than the ceo of staple financial. he is here for the better part of the hour and we will have a great conversation but i will send it back to you for the moment. i know you did not want to sit next to me. you intimidate me. stephanie: i understand. you are midwestern and new york is overwhelming. vonnie: let's get you first reviews. marching workers are in what organizers call their biggest protest yet, demanding hourly pay of $15 per hour which would double the federal minimum wage. political organizing will help

back their cause. candidates will appear in primetime tonight for the republican debate. the sponsor is fox business and "the wall street journal." it starts at 9:00 p.m. eastern. steve jobs is a flop -- the new movie was released nationwide late last month but is being called from 2000 theaters. it's the second movie about steve jobs in three years. you can get more on these and other stories at the new bloomberg.com. let's get to matt miller. matt: we are seeing futures down across the board after the losses yesterday. the s&p 500 of its down today will be five days in a row. we hit an intraday low yesterday we had not seen in six weeks. --ouple of big stock stories

apple is moving down in the premarket. credit squeeze says channel checks in asia are showing a drop in orders for components, 10%. isonents for the iphone 6s a concern. bvaliant is holding a conference call. they say that negative press is having a modest impact on its canadian business. i was thinking about the impact on twitter on valeant stock. on bloomberg, drx you can click on this little birdie icon at the top of the toolbar and you can see all of the tweets and social media action on the company. vc --an also click bs

bloomberg social velocity and when people are tweeting the most about a stock. you can keep this up on your launchpad. right now, there is a spike on social media for erik schatzker because he is live from washington, d.c.. erik: it is time for the stories that matter most to markets right now. this is a special edition with ron krzyweski. study on by a goldman sachs that looked at the pace of expansion in the united states. we are now in the 76 the month of economic expansion in america. goldman see aat 60% chance that it will hit the tenure mark.

that's pretty remarkable. it would be the second longest atansion in american history a decade. how do you feel about the pace of the economy? >> it might be the second longest but it might be the slowest expansion also in history. i don't think we have had 4 quarters consistently that add up to 3% gdp and if you think of the financial crisis averaging 3% growth and since then, we have an expansion but it is painstakingly slow. erik: in other words, nothing to get excited about. >> when you think about what we have lost in economic output trending below 3% first seven years now, those are big numbers. i think the question is not how long the inspection goes, -- along the expansion grows, can we get above 3%? david: the number two story, according to jeffrey gundlach,

the december rate increase would threaten u.s. stock and bond markets while potentially drive up the value of the economy weakening -- drive up the value of the dollar weakening the economy. this is not a new position but he is not giving up. erik: no, he is not want to give up at all. what are your thoughts? there is so much attention paid 25 basisotion that a point increase which is expected from the federal reserve is a big deal. jeffrey gundlach is weighing in and saying it has implications for stocks and bonds. what do you think? >> i think it gets too much attention. the real question will be the pace of change. in thisthe question environment will be what is the equilibrium interest rate? what will rates go to once we start? i think people will be surprised.

in my opinion, the equilibrium interest rate might be 1.5% on the fed funds rate and echoes back to my comment about the pace of change in the u.s. economy. it's slow. erik: to clarify, we may see fed funds rise to a peak of 150 basis point? >> that is the question. the fed fund rate will be lower for a lot longer than people think, that's my first thought. let me follow up on something you said earlier which it sounds like you're building toward the larry summers secular stagnation these is. are we ever going to get back to pre-crisis growth numbers? >> i think that is the question. larry summers has one very out there about too much liquidity facing too little investment. i will not argue with larry summers. i think the real question is what do we have to do to get world going again in a

which, no matter what people say and they don't like hearing it and people don't want to talk about it, but what we have going on today is expansion into a deflationary environment. we got to change that. can we get above 3%? i hope for my kids that we can. erik: there is a lot of background noise here so back to you. stephanie: this will cause more noise. number three -- shares of the drugmaker plummeted on more than 22% yesterday when citroen mentioned that they are going after mallon inkrodt.- mall can you believe citroen that we have not heard about three weeks ago has caused this much market reaction? they are commenting on twitter, one year ago, they were not looking to twitter for market commentary.

world and notw only is it market moving, we have to look at the impact and how valid and what are the rules for all of this. there will be discussion about source selling. clearly a market participant, so to speak, these people that twitter about stocks. it's the new normal, frankly. this is a really cool screen. this, this a look at is over the last month, number left,rew the second-most the you personally of the entire month is someone no one has heard of. stephanie: you have the new ceo of barclays, phil ackman the

biggest shareholder of value and the guy from brevin howard and novograff, the biggest names in the industry. matt: welcome to the club, andrew. been talkingave about the news on twitter but there is an old world idea that this is a masterful shorting strategy. you come up with an idea and let that one float and you see what happens. meantime you got a short building somewhere else and you dribble that out. david: that's the game plan. credit squeeze may need to cut bonuses -- it's a report they would cut by 60% because of losses incurred by write-down. earlier, we heard from the bank ceo. let's take a listen. i think that is a speculative story. i won't comment on that. fundamentally, we pay for

performance. bonuses will be set at the end of the year. david: there is a lot of talk about bonuses and if they will be down in new york. what do you think in d.c.? erik: it's not a matter of what i think. it's a matter what ronkrus chwski thinks. how much pressure is there on bonuses this year? >> i think people will be fine. if you think i will tire that bonuses will be down, it's not going to happen. active people are doing just fine. it was a tough summer. china andgot about the devaluation and all that was going on. this is not necessarily one year to write home about. in financial services. one of the consultants says bonuses will be down 5-10

%.0 is that right? >> that's what i've been hearing but i would think they would be down more. i'm not sure people have factored in the debacle that occurred in fixed income in the third quarter. we will see. here a while and financial services are just fine. erik: another story came out this morning that had to do with pimco. the lawsuit that bill gross filed against his former employer at pimco makes allegations about their thirst for fees. that is a story underscores this, the idea that the pimco total return fund, formerly the largest mutual fund in the world, charged almost as much in administrative fees as it did in management fees and pimcotal value of the administrative fees charged last year equal the total fees charged by 2 of their rivals,

net west and double line. scrutiny are your financial advisors giving those fees? there are concerns about pimco. >> when pimco had the best performance in the world, there was not a lot of comments about that. comingu have performance in under scrutiny, fees come under scrutiny. i think it's valid and you need to look at fees relative to performance always. there's not much more to comment on that. nice try. in a zero rate environment, fees destroy returns. absolutely, relative to zero rates, all fees are relevant.

but you need to pay administrative fees. to.ow what you are getting erik: do you disagree? >> i don't disagree that fees need to be proportional to performance. who is going to argue that? erik: what are your thoughts? brendan: with healthy competition, you with thing fees and disclosure would take care of themselves in the market would find was comfortable with but that's not what's happening. this is being disclosed through losses. what is it about the structure of the fund market that makes it hard to figure out with the fees are? always do ae can better job of disclosure. these fun prospectuses are pages and pages. we just had a controversy in the industry on breakpoints that were not -- we had an issue about it. we can all do a better job at improving the transparency of

fees across many aspects of the industry. its controversial but i think we can do a better job. erik: while we wait for mary jo white, i will send it back to you. >> you are kicking me off for mary jo white? >> we will be back. just letting you know. stephanie: did he just say are you kidding me off? eric is not that i am. disney released a new trailer for "star wars: the force awakens." it is viewed -- it has been viewed 88 million times in 48 hours. the movie is out next month and should make one point $7 billion worldwide.

-- $1.7 billion worldwide. david: i do love "star wars." stephanie: didn't you dress as darth vader? david: i did. brendan: i introduced myself to the original movie. my six-year-old said he cannot believe darth vader is luke's father. stephanie: david will do an entire show it as darth vader costume when the movie comes out. erik will sit down with mary jo white coming up and later we will be joined by the priceline ceo. ♪

vonnie: welcome back. general motors could be forced to pay millions more in damage

is linked to its defective ignitions. a judge says it could still be liable for problems that happened before it emerged from bankruptcy six years ago. the courts as plaintiffs would have to prove a cover-up. the uaw proposed contract with ford would bring production of ranger pickups back to america. that part of a deal requiring four to invest $9 billion in the u.s.. uaw members will vote on this and it includes raises and signing bonuses. say seaights groups world plans to end orca shows but it does not go far in a. whales should be displayed in a different way. we talk about the big hit that star wars will be but lions gate was not that big with the "the last witch hunter."

it missed analyst estimates with its second-quarter results. it is going to finish "the hunger games" series so investors want to see what more it can bring. shares in the free market are doing pretty well. faith in the last hunger games from coming out. d.r. horton had fiscal fourth-quarter earnings that grew 33%. beat -- big gains as far as growth is concerned. home prices across the country set -- rose .5% in 13.5%. and then the gap is a losing story. talked about same-store sales in the gap is down 4% in the last quarter.

12% andepublic is down the gap is down 6.5% in the premarket right now. we will take a quick break and when we come back, the interview with the sec chair, mary jo white. ♪

stephanie: welcome back. erik schatzker is down and d.c. for the sixma annual meeting. less than hour ago, we sat down with the incoming ceo of credit sweeties. one thing that sticks out to me is he so centered and the same background as james gorman, both former mckinsey consultants. we have seen criticisms of bank ceos they come from organizations who have love for their legacy businesses.

it's hard for them to distance themselves from those units and see the big picture. james gorman has had huge success at goldman sachs. david: if i am worried about risk and volatility, that's the sort of person i would like to be supervising. it seems like he's got a sense of it and command of it and will not panic. in this particular time in banking, he's the right personality. stephanie: it sure seems that way. we have erik schatzker down in d.c. with mary jo white. erik: thank you very much. i'm honored to be here with sec chair mary jo white, thank you very much. >> glad to be here. erik: you are no doubt aware over the increasing or growing controversialhe role that short-sellers play in financial markets, particularly the stock market. how concerned are you that some short-sellers may be manipulating the market and

prices of certain stocks either by publishing research or making public comments that benefit their position? a specificy from matter. the marketplace is built for buyers and sellers to come together with long and short positions so short selling has a legitimate, positive purpose marketplace. that is different than if you manipulate by shortselling. if you are shortselling and manipulating by false statements you may be putting out, that is something we continue to police but bring strong enforcement actions against. it's designed to make sure shortselling occurs legitimately in an orderly way. is topic of shortselling something that continuously gets attention at the sec as it doesn't marketplace. erik: do you have any reason to believe that manipulation is taking place? >> there are some cases that involve manipulation by short-sellers.

and every other kind of market participant. in on matter of zero and the specific circumstances. if there is manipulation by putting a false information or deliberately manipulating the market, that is now something we pursue on the enforcement side. erik: one of the concerns now is that some of the short sellers are giving clients advance , that or advance word they plan to go public with a negative position on a stock. if that's the case, the wood that constitute insider trading? i would not make a generalized statement about that. we look at that across the area shortselling. any opens the sec have investigations? what about citroen research? >> we never comment on what we are looking at. erik: what do you think about

the notion that there should be more disclosure requirements for short-sellers? >> that's clearly something some market participants are urged and we are looking at that and continue to. erik: do you believe it is necessary? >> i don't want to get ahead of it. there are disclosure requirements are people who take long positions but that does not apply to short positions. >> it's a complex landscape but it is an issue that has our intense attention. mean? >>t is intense it means i'm paying attention to it. erik: that says something. >> don't over conclude. it's an area that has been discussed and it's an area that has been advocated for for a long time and is one we take seriously at the sec and we're looking at it. erik: talking about the public market where buyers and sellers can meet. with that in mind, is talking

down a stock any different in your mind from talking up a stock the way activist hedge fund managers do? there are implicit questions with respect to that. all market participants have a duty when they are in the marketplace in buying and selling securities not to make materially misleading statements. no matter what your role is in the market, no matter what your influences, that's an obligation in federal securities law. it forow appropriate is a market participant like a hedge fund manager or a short seller or someone research to send a stock soaring or plummeting on the basis of a tweet. this is 140 characters. >> that illustrates one of the challenges in the modern marketplace. informationce of

that must be policed actively. it carries the same obligations to be truthful in terms of what's required in the federal securities law. erik: is there any difference between that and a four hour presentation? >> the essence is the same. erik: so it subject to the same scrutiny. of misstatements that violate federal securities law, the scrutiny is on. 5 erik: some activists have been using in the money options to build up economic companies without having to buy the common stock and, as such, trigger disclosure requirements. it seems like a neat loophole. is it fair? there is a whole area of issues that people are focusing on with respect to activist

investors and non-activist investors and that is one of them. asked what our view is for they are viewers, they are market participants and are subject to the rules. we scrutinize for compliance and we bring in and forced on when appropriate but we are not taking sides. erik: given the fact that this allows an tactic investor like a hedge fund manager or anybody else to have full economic interest in a security with having legal title to it, aren't they effectively the same thing? i cannot go beyond saying that is an issue that we are aware of and are looking at. erik: is it getting the same intense scrutiny as short >> sellers? everything does.

erik: you have been asked about the role of activist. does the fact that they are increasingly influential require or demand more scrutiny? >> again, any market participant that is more active in more significant ways me to get greater attention because there is more to look at in terms of doing our role. a quantitative difference, not qualitative difference, if that makes sense. in some cases, is not a matter of, it's money or the size of the company they go after come a fame out the volume that's involved in the public statements. is that something you can measure? if i understand correctly, the volume of what they say -- erik: the volume. -- something at a higher decibel level may get our attention more quickly.

but it's not because it's at the higher decibel level in and of itself. erik: let's go to another issue, volatility. do you share the view that financial markets are becoming too volatile? is what you look at when you look at market quality and something we look at in the equity market structure reviews. notst 24 gave us -- we did ask for the many stress test. a lot of data is coming out of that. our trading and market step in particular but others are looking closely at how etf's d in the early morning hours of august 24. a is looking to become on permanent basis.

probably we will share some initial results from our review of that day. erik: have you come to any preliminary conclusions about gets in regulation that need to be covered or fixed? >> no conclusions. it will be of commission that comes to whatever conclusion. or any it's volatility other aspect of market structure, you never stop looking at it and trying to optimize the markets and how they work. you decide that we need to make a regulatory adjustment or fixed or you may just's need to message with market participants to approve something. we have not formed any conclusions but we're looking 24sely at not just august but other pilot rules. erik: do you believe investments need more protections from the violent moves we saw in etf's

where the prices diverge so dramatically? >> i believe in making investors as strong as we can against possible risk. month thataid last the treasury market needs more oversight and risk controls. you are making specific reference to high-frequency trading. is that a bigger problem in the bond market than the stock market? tradinghigh-frequency -- what i think i said is that all the regulators in her agency working group are looking at areas where we can optimize the regulation of the treasury markets without drawing any conclusions. high-frequency trading is important to get the definition straight. there are different strategies employed by high-frequency traders. someone you would not call a high-frequency trading could be using high-tech, high-speed

methodologies in the same sort of way. furtherneed for regulation? we don't think of it as just high-frequency traders. erik: what have you seen in the bond market that concerns you? >> i have talked about this at some length. the concern in the bond market is some of the same issues in the equity markets but also just greater transparency for the public and regulators. erik: i have one last question -- consequences of the post crisis year a is that -- our run is that dodd frank has forced risk out of regulated entities into non-regulated entities. to what degree does that concern you? i think you have to do fine, assuming the risk has moved, has it gone into an unregulated area or just an area regulated by other regulators than banking

regulators. i think sometimes the discussion is of its moved out of the banks, it is moved into unregulated territory which is not necessarily the case. as a regulator, any regulator, you have to be concerned about risk that was once in one area overseen by different regulatory regimes now moving into another and your -- and are your regulations robust enough? it is something you continuously look at. in asset management, that is something where we are engaging as we speak in an active and enhancement of our regulatory regime. it is in pursuance of our traditional mission to protect investors. the benefit, ive think of touching those systemic risks that others are worried about. erik: thank you very much for your time.

that was mary jo white in washington, d.c.. i will blame the media for the moment is we talk about market manipulation and short-sellers. in terms of short-sellers, dick calls himself a market archaeologist and if it wasn't for short-sellers, we would not know anything. many of the analysts covering valean had it as at buy. havean: she said we intense interest in greater transparency but that's not banning short-sellers. david: you have to remember her background. she was a prosecutor, the lead prosecutor in the country from a southern district.

an important part of this is what not to prosecute. she was right down the middle. you are right, she did not take a position. a fan of mary jo white and a fan of matt miller. matt: i am a fan of yours as well. markets are down but not huge movements. /100s&p 500 is only off by 2 of 1%. the nasdaq is taking the biggest loss. on yourook at imap bloomberg terminal, you can see that ip is the biggest loser. is thaton for that apple is down after credit suisse said their asian department did channel checks componentat iphone 6s orders were down as much as 10%. there are concerns about the sales of the 6s for the short

term. on the other hand, ever core said apple is among the companies that may announce a share buyback and did a cool study. that since 2003 companies announcing share buybacks have an 88 basis point gain over the s&p 500 on that day. it's lower this year but it's a cool study. let me get into the debt area and talk about the 10 year. we earlier had yields coming down with investors getting into the 10 year and government debt because they were concerned about the chinese inflation number. then they got back out again as they realized that there would be a rate increase in december. they want the new paper instead of the old paper. in equities, there are some cool stories. talking about shortselling, valeant firmest of vehicles is

holding a conference call with the co's wit with the ceo saying that management has told him there was no wrongdoing at the company and he will cancel all ties with filador. does not want to be involved in a company that has no wrongdoing. [laughter] stephanie: i said to myself you are no good, you're out of here. matt: it continues to draw a line between valeant and filador. stephanie: that is a valiant effort but does not make much sense. matt: we have a lawyer onset. david: let's get back to washington. the takeover chair does not seem to be slowing down.

let's go to steeple financial ceo. welcome back. >> thank you. david: tells about this acquisition tear you are on. know if it's a tear. it's what we do. at and are going to continue to build a firm that takes up the slack that caused the financial crisis. i would not characterize it as a tear. it seems like we do one deal per week. erik: 19 deals in 10 years. that's a tear. >> it doesn't feel like one. 5 erik: another firm that has done a lot of acquisitions is valeant. >> here we go. erik: i'm being unfair. that is a very active pace. it raises questions were some people.

why? you talk about slack but how much is left? how much more can people do the kind of business building you have been doing by acquisition? >> i think there is plenty of room. the largest financial institutions still are shrinking lr and iing with s cannot even name all the rules. that provides an opportunity for a firm to grow and pick up market share. we will continue to do that where makes sense. where exactly? you talk about slack in the to salest if you speak guys, there does not seem to be enough business to go around. the deal you did last year, these are big cultural shifts. how is it playing out?

it does not feel like there is slack in the system. it that't characterize way. you don't roll people of. what we really do is we take slack out of the system because we put people together and we become more efficient on a platform. puts us incent deal the alternative space which we were not in and we believe that's important. it provides access to alternative markets for our investors and our high net worth individuals who want to play in that market. i think it makes sense. anytime you do anything that is in growth, people will take issue. it does not impact me too much. erik: can you say something about where you see fund flows going? businessbrought on a

whose primary activity is raising money for private investment. >> not only private investments but also, they will place private stocks as well. because the market structure and the things that have occurred, there is an ecosystem for small companies which has been destroyed in the last 15 years. the research rules and decimal is asian of trading is made it difficult to be a small company. we definitely see growth in that market. hands, we are parting with eaton partners. stephanie: your stock is highly correlated with rates in large part because of your interest in stifel bank. we are so focused on is rate hike. sure, we are like most financial institutions.

we are what they call assets sensitive which means a rise in rates would be beneficial to our earnings. we are not alone in that. from that perspective, i have been looking forward to a rate increase. that said, i have been pretty said that i have not the world economy can sustain a rate hike. i may change that view on the recent jobs report which was solid. stephanie: with the 10 year at 3%, what do you predict for earnings growth? >> i'm sorry -- 5 erik: look kind of earnings growth can you generate? key for thehe real economy in general is a handoff between quantitative easing which has driven growth and driven everything that has happened in the markets. it has been that assets have been supported by quantitative easing.

that handoff from quantitative easing to actual growth in the economy which is needed to support a rate increase, that lateral is what is driving markets crazy right now. people are not quite sure whether the economy can withstand going from being fed from quantitative easing to actual growth. if there's something missing in the world today, its growth. sorry, there is just not a lot of growth worldwide today. that handoff has to happen in washington, d.c.. brendan: what you need out of capitol hill to make that work? to -- i thinke there are two issues -- monetary policy and fiscal policy. the handoff to support the short term interest rate, i don't think 25 basis points matters one way or another. long-term, we obviously need

fiscal policy. how about a little bit of tax reform? the u.s. corporate tax rates are the highest marginal tax rates in the world. if you want to talk about limiting capital formation in the united states, we can talk about that. these are things that need to be done. will they get done in washington? i don't see a lot of momentum of anything getting done. erik: i'm sorry i don't give you that feeling. >> but you are from new york, you are leaving. ronhanie: did i just hear we may have to join you in st. louis. thank you both. we have a lot to cover. david: now we will turn toward hotels. the holiday season is around the corner which means millions of americans will be traveling. the largest online travel agent in the u.s., priceline, forecast

a weaker fourth-quarter due to a drop in u.s. bookings from lower airfares and a strong u.s. dollar. darren houston is the president and ceo of the priceline group and joins us live from the year ahead conference in new york. welcome and thank you for joining us. >> hi, how are you? us about the forecast for the fourth quarter and why you are more modest than before? >> we had a fantastic third quarter. 29% on afit was up constant currency basis and profit was about the same. it has been a fantastic travel season. our business is very global so we are impacted by currencies. currencies of gotten weaker against the u.s. dollar. that's the primary reason but we still see we will have a healthy fourth quarter like we did in the third quarter. can you tell us what percentage of bookings comes from overseas? yeah, we don't reveal that

data but it's a high percentage of our business. we also have a great business with american. we have priceline.com con but we have a lot of foreigners should shout -- travel in the united states and foreigners in a visiting the united states near to the degree they have in the past primarily because of the strong dollar. this will pass at some point but that's today's reality. many americans traveling overseas are taking advantage of the dollar going to europe and heading into south america and heading into asia. that is a clear trend in the business. brendan: let me talk about pricing. your bookings come from hotels that are you seeing pricwe pressure? thatere is a little bit of but overall it's a fantastic hotel environment particularly in the united states with occupancy high and prices i. there is some data that shows in touristsr cities where

come into like new york and san francisco, there is pressure on pricing. it is a little bit related to people wanting to take alternative accommodations. on our sites, we offer more than 6 million types of different alternative accommodations and we see a major trend for business people renting an apartment instead of saying -- instead of staying in a hotel room. the water is high right now but the alternative accommodation is entering many cities in the united states. would you counter bit to buyexpedia offer home away? >> in our company, we built our own vacation rental product. we have a business as large as home away or air bnb and our product is instantly confirmable and we don't charge fees. we built it organically and is great for consumers. big players like priceline and

ex are focusing on bringing this vacation rentalpedia marketplace into the internet age. stephanie: you have your own business and you would not look to buy home away? over the years, we have built up our own business and we have a team that is built it out and we built it to reflect the friction out of booking vacation rentals making it more like booking a room room. -- booking a hotel room. you can innocently verify you've got a booking with our model and make sure you got it at the end of the day. stephanie: did you book your room tonight in new york? >> absolutely, i booked it on priceline. you have to use your product. i do it all the time. stephanie: thank you so much for joining us. we will be right back.

david: welcome back. stephanie: the incoming ceo of credit suisse, talk about someone centered and positioned to take them to the next level. he is moving things on to asset management. ma will sit down with emily chang tomorrow. you don't want to miss that. a.m.ou tomorrow at 7:00 ♪

betty: it is 10:00 a.m. and 3:00 p.m. in london and midnight in hong kong.

from bloomberg headquarters in new york, good morning and we have breaking news -- jpmorgan confirms it was one of the major banks that were targeted as a victim of hackers who are indicted and are on trial right now. some of the world's largest banks, jpmorgan confirms they were one of them. they were victims of hack attacks over the past 12 months. hackers are in a federal grand jury trial. the 4 have been identified. we will have more on this story but keep watching this developing story.