from bloomberg's headquarters in new york, i am david gora. the u.s. and france vowing to eliminate the islamic state aspirations wonder how long it will take before their lives return to normal. marriott and by starwood hotels for $12 billion. starwood capital barry sternlicht joins us in a few minutes for an interview on the deal. and berkshire hathaway cutting a deal in walmart. why the company is backing up its cash. ramy inocencio has the latest on the markets. ramy: good afternoon, we are at session highs, looking at the markets, a bit of a surprise. the dow and s&p reaching toward gains of 1%. .6%.asdaq is up this might be a bit of a

surprise after paris but there is growing proof that markets are getting more resilient to terror attacks ever since 9/11. concerning what happened, it might be a surprise that the cac 40 closed pretty much flat. . couple movers to talk about consumer discretionary was the biggest loser, investors pulling example.mh, for energy stocks on the other side. an interesting lack of reaction for the most part. i wonder how the markets have reacted with past terrorist events? here is a look at past events. markets have sharp reactions and then increasingly short-lived. you to the s&p, oil, and the dollar after 9/11. the s&p 500's performance right

after september 11, 2001, you see a drop of 12%. here on september 24, the index starts to pull back up. at levelsr, basically before 9/11. looking at oil, similarly, the price jumped 6% right on september 11. once trading resumes, it took three days for it to get back to pre-9/11 prices. the same thing with the u.s. fallingand s&p as well, right after the attacks, but pulling back a month later. all of this pushing the idea that the markets, the dollar, oil, all resilient in the face of terror, and we are seeing that in the cac 40. there is an article on bloomberg right now that is great, talking about this. david: thank you.

let's check in on the first word news with mark crumpton. mark: president obama is resisting calls to put ground forces in syria and iraq to fight the islamic state. speaking in turkey, the president said such a move would be an error. >> folks want to have opinions about what they think they would do. present a specific plan. if they think that somehow their advisors are better than the chairman of my joint chiefs of staff, and the folks on the ground, i want to meet them. and we can have that debate. mark: the president called the a sickeningible and setback in the fight against the islamic state but says his current strategy will ultimately work. in belgium, prosecutors have charged two suspects in connection with the attack but added additional searches have

so far failed to turn up more suspects. the identity of those believed to be involved have not yet been relieved -- revealed. there have been 23 arrests in france, seven more in belgium. french authorities are identifying a belgian man as the mastermind behind the violence and more victims are starting to be identified with the official death toll rising to 129. french president francois hollande said that the violence targeted youth in all of its diversity and the victims represented 19 different nationalities. global spending to curb the impact of climate change increased eight can -- 18% last year. spending surged to $391 billion with much of that being used for solar parks, wind farms, and other renewable energy projects. the legal arguments over funding of planned parenthood would not be heard by the u.s. supreme court. justices have rejected an appeal by abortion opponents seeking

access to internal documents from the health care provider. new hampshire right to life wanted more information about a $1 million grant to a planned parenthood chapter in the state. the latest on these and other breaking stories 24 hours a day at the new bloomberg.com. much. thank you so three days after terrorist attacks, parisians returned to work. the city security presence is heightened, especially a key transportation hubs. brendan greeley is in paris. early and rode with commuters, spending the day talking to them. now it is nighttime, the eiffel tower eliminated. what have you heard from parisians today? brendan: parisians are going back to work. i rode the train with some commuters. said what people said after

september 11 in new york, we are because weto work have to. there were fewer people than normal, but people are going back to work, but their world has changed. what you see behind you is the plaza de republique. hebdothe charlie massacre, there were huge demonstrations, candlelight vigils, and that you have smaller groups of people. out inare afraid to be small groups and they really want change. president francois hollande spoke to the national assembly. day and the congress need to get together to change the constitution of france. he wants to make changes in the way the state approaches its citizens. people are ready for it. about what have they set some of the proposals he has made today, such as heightening the amount of counterterrorism

money, the amount of defense money in the budget? yesterday, i spoke to some parents in a part of the city, who are watching the kids play soccer and with light sabers. i was asking them what they would expect to see change. they said they would never lepin, but they said that she had said a lot of things that they wanted france's leader to say. remember, this is a country where, in may, they allowed a law that allowed the collection and storage of metadata. the entire country is much farther to the right than we are. mark: thank you, brendan greeley. peopleattacks unfolded,

around the world wondered if similar attacks could happen elsewhere. aniel benjamin was coordinator at the state department, now a dartmouth college. i want to ask you about the quantity of raids that took place over the weekend, more than 150 of them. what do you make of the response from france so far? daniel: that suggest that they were going after a large number and wereradicals simply not going to wait until network analysis had provided them with three suspects who they should go after. under the circumstances, that is appropriate. it is in for -- important to remember, there is a pretty significant number of radicalized individuals living in europe. france has a very large muslim as,rity, and that minority unfortunately, spent an outsized

-- sent an outsized number of recruits to isis. so it's not surprising the french, after such a dramatic event, were going after all the known suspects. early days still but it has been striking to me how many of these raids took place in belgium. you take a look at what is happening in belgium. is that a surprise to you? daniel: not a surprise. belgium has, per capita, if you will, send the largest number of recruits to isis. there is a really vibrant extremist milieu there. we saw in january were there was , that in a belgian town there were a lot of suspicious characters around. there have been extremist activities, terrorist plots in belgium going back to well

before 9/11, including one against a u.s. airbase. so it is not surprising at all, and frankly, our european friends, belgians in particular, have been slower than they should have been to get on top of the threat. david: it is easy when you live in a big city like new york and the aftermath, to think that it could happen someplace here. is that reasonable, to think that something that happened in paris could happen here? daniel: of course, there is no perfect defense. the perpetrators were using automatic weapons. the u.s. is awash in automatic weapons. but i think it is considerably less likely that it would happen here because, first of all, it is much harder for extremist to get into the u.s., than it is to get into europe, from syria or iraq. they only need to go through turkey, which has a pretty

porous border right now, to get to greece. to get to the u.s., they would have to take an airplane, and we have layers of security on aviation. we also have many fewer extremists in our midsts. in rate of radicalization the united states is a fraction of what it is in europe. we are sending people, unfortunately, to isis in iraq, but the numbers are roughly r, 100,000,d per however you want to count it. spent anon, we have enormous amount of money, law enforcement, and on border security, and that is something the europeans have not done yet. david: i want to ask you about that. is expectingande to ask for more money to be spent on counterintelligence, defense. you have written about how a

huge problem in europe is just the disenfranchisement of muslims living there. when you look at how resources could be allocated, should they be allocated more evenly toward defense and counterintelligence, and trying to rein in that disenfranchisement? absolutely, europeans have been reluctant to spend big money on security, whether it is conventional military security, or intelligence and law enforcement. the numbers they have in the problem are quite low compared to what we have done. of course, they think that we have overdone it. i think now maybe they are reviewing the conclusion. europeano true governments have been working to m ely among their muslim iorate the, -- amel feeling of monks muslim minorities. islamophobia, of

a lot of discrimination against muslims in europe, and that does not help, and in some cases, drives some to be more extreme. david: thank you, daniel benjamin. marriott says, bigger is better as they become the world's largest hotel chain with the purchase of starwood. what barry sternlicht has to say about the deal. ♪

david: welcome back to bloomberg markets. i am david gura. ramy inocencio has an update on some deals. good afternoon. liberty global has made a rumored buyout of latin american company cable and wireless. right now, liberty global is down by 1.7%. a $5.3e talking about billion market share in the caribbean, as well as expanding its own share in latin america. as you can see, liberty is up on the news, 3.3%. and john malone moving some assets into latin america. interestingly, warren buffett added 500,000 shares in his from thisrelease

morning. switching over to retail, urban outfitters has decided that selling food might be a good partner to selling clothes, but investors who were in it for the long game are not agreeing. shares are down by 8.8%. the retail chain is buying a family chain of restaurants to add to its portfolio. major news in a hotel industry, as you were talking about, david, marriott international buying starwood hotels for $22 billion. marriott is up by .2%. starwood is down by 4.6%. you would expect starwood should be higher, because that is usually the case with a company isting bought up, but paris waiting on the industry in general. at any rate, the new hotel company will be the biggest in the world with 5500 hotels, i

think about 1.1 million rooms. david: thank you. as you mentioned, the hotel world is buzzing on that news. let's go out to the investors conference with stephanie ruhle. she has barry sternlicht, ceo of starwood capital. stephanie: thank you. who better to opine on the subject than barry. this is like watching your child grow up. barry: and disappear. ofhought the stock was sort overvalued, started to get a lot of calls from hedge fund friends of mine asking my opinion. i was surprised. i knew that they were not going to do it, but i think they did a smart transaction for them because they used stock, trading at a multiple premium to starwood hotels and now spinning of the timeshare business. .here were enormous energies

i thought it would be either hilton or marriott initially. then both companies downplay their interest in the company. changed his mind. he called me about it and we chatted about it. i founded the company and ran it for 10 years. i think it is good for starwood. i think the world is going this way. while i hate to see the company not be around anymore, i did not want to see it flounder. you don't want to see your kid grow up, -- you want to see your kid grow up, get married, have lots of nice brandon davies. arne has done an amazing job with the company. stephanie: why are they floundering, do you blame airbnb? >> no. i would blame lack of focus on the basics. createdated and always noise around the customer, changing the industry with w

hotels and the heavenly bed. a lot of technology innovations, but maybe they forgot about the customer and the brand started losing market share. and they did not keep it fresh. ao successive ceos, maybe third, if you include adam, who were not really celebrating our heritage in the space. they did not really go that way. we had all the brands reporting separately to me. the namerid of that in of efficiency, but they lost the brand integrity, the individual brands. they stopped innovating the way they should have. stephanie: why does brand integrity matter when you are in a time with airbnb? airbnbonly way to fight is to have an emotive experience. ne hotel,ay at a w or o you feel differently about yourself.

you are not seeing that with airbnb p review are staying in somebody's home or whatever. at least in this evolution, this is a different play. bring up theu baccarat hotel, which reminds me of chinese bidders. it was surprising that the deal did not go to a chinese bidder. do you believe it did not happen because they're hamstrung by government approval? i was contacted by several chinese bidders, and they are just slow. it is hard to run a company without a permanent ceo. it is still possible they could show up. there is now a real bid for the company. stephanie: you think it is not over? no idea.have i saw when marriott and helton dropped away, -- hilton dropped bit, i thought the next would be from the chinese. there are not many of these companies. these are rare jewels. this is one of the great growth industries in the world.

if you think the middle class is developing, travel is what they will do. no technology will rue the desire of somebody that wants to go to the beach. stephanie: for you, it has always been a retail play. is it the hotel operators not owning a business that is their mistake? barry: they have to add value. y's earnings, nordstrom -- you really have to wow the customer, or they will do it online. i think the bar is raised or travel. the scale of this merger was done to fight the online travel agents and the potential threat of airbnb. --do you really want to leave the starwood system? you can now stay at the w and get your points. two powerful programs merging together. you will see global consolidation.

this probably will not be the last deal. stephanie: you think we will see more m&a? airbnb and the threat of it is only getting bigger. barry: you could. there were the obvious candidates interested in starwood. you can guess who i am talking about. i think they are doing fine. i think you have to think about the next 20 years and how the business will involve. there are just not many of these public companies to buy. it is a big industry. the joke is they do not have the airbnarket cap of uber or b, but they will have more leverage now with the ota's. that was the battle with me, are we going to have a price battle with expedia and the others? companies try to pull off both systems and they lose customers.

if you get big enough, can you pull off an expedia? stephanie: you are long and hot on the rental market. barry: changing topics. we bought $7 billion of apartments recently. stephanie: why? barry: the country is producing 1.5 million households a year, 300,000hose we have apartments, and the rest of single-family. hasproportion of families dropped. people are renting, not buying homes. we think that is a function of the change of demographics. euros, athese 18 to 30 bubble of them -- year olds, a bubble of them, and their propensity is to rent. we pick some exciting geographics like florida, denver .

and seattle is cooking with gas. stephanie: are you following the demographics or airbnb and this major rental, service, don't own anything movement? barry: we are not thinking much about airbnb. these houses did not just appear. people were renting before. anotherey were on service, using a local broker, listing agent. this is not like a million rooms that showed up overnight. many of these units were already in the pool. some of this is more talk than reality. i thought airbnb when do really well in europe, which has the culture of bed and breakfast, but it is pretty tough to host a group in an airbnb flat. stephanie: donald trump has been doing a lot of talking.

one of your investors is a supporter of donald trump. what do you think of him? barry: what is the next question? [laughter] i think donald speaks some truths. i'm not sure i want to really answer the question. he is a unique person. i get a kick out of him, he is funny. i don't think everything he says is right and he makes it up as he goes along, but you know donald. i agree with him, this is our fault this happened in paris. everyone in the middle east has been telling him differently, and today he is looking the other way, and no ground troops? stephanie: barry, we have to leave it there. ♪

david: from bloomberg world headquarters in new york, i'm david gura. let's get the word news with mark crumpton. one of three brothers a

link to the carnage in paris is speaking out and expressing disbelief that two of his brothers were involved in the violent that left 129 people dead. he spoke to reporters today. i cannot tell you why, i cannot tell you how they did what they did. we are an open-minded family. we never had any problems with justice, and you also must understand that because of the tragedy, my parents are in shock and do not quite realize what has happened. his brothers died after detonating a vest in a suicide bombing, and the other is a fugitive and a suspect of a manhunt. president francois hollande says he will ask parliament to expand the state of emergency which would expand police powers and limit public gatherings. today he outlined details about products assault. -- friday's assault.

>> what happened on friday was something that was decided upon, that was planned, in syria. it was something that was organized in belgium. and it was something that was carried out on our territory with the complicity of french people, and there is one aim through these attacks. , topread fear and terror make sure we will be divided, and also to exert pressure and forbid us from acting in the middle east in our fight against terrorism. mark: president hollande also said the u.s., russia, and france must join forces to defeat the islamic state and called on president obama and vladimir putin to unite efforts. the symbol of paris has been relit and a splash of red, white, and blue. the eiffel tower dimmed its lights following the attack but they came back on earlier today.

as you can see, featuring the colors of the french flag. it also reopened to visitors. an emotional moment for president aland as members of e andament -- holland members of parliament expressing their grief together by saying the french national anthem. singing the french national anthem. you can get more and these breaking stories 24 hours a day on the new bloomberg.com. thank you. as world leaders contemplate how to target the islamic state, president obama vows the u.s. and its allies will defeat the islamic state. he says ground troops are not part of the strategy but sharing intelligence is. already a strong counterterrorism partner and today we are announcing a new agreement, streamline the

process by which we share intelligence and military information with france. this will allow personnel to pass threat information, including on isil, to our french partners more quickly and more often. joining me live from capitol hill is senator ben cardin. thank you for joining us today. ben: good to be with you. david: i want to go back to the call about more unity between the u.s., and russia. do you and your committee members have an appetite for that? ben: the concentration right now is on isil. we want to contain, diminish, and eliminate isil from the middle east. russia shares that agenda. where we need russia's toperation is bringing assad

a diplomatic solution so we can get an interim government to represent all the people of syria, and a future without assad in syria that will be a part of the diplomatic solution that can bring syrians together and concentrate against isil. then russia, the u.s., france, and all about global partners can concentrate our military efforts to constrain and eliminate isil. we sawe saw -- david: the footage of president obama sitting down with president putin. you speak to secretary kerry, visit seem like that is where russia is headed? ben: i think they understand that the future of syria is without assad. they need to ensure there is no vacuum of power that is created. thank you to create a government that could control the country and stand up to isil. we want to have a strong government in syria that represents all the people of

syria. there are areas of common ground. i hope it we can reach it quicker rather than later. president obama saying in turkey that he does not foresee roots on the ground in the fight against isis. counterpart, senator feinstein, saying that military efforts are not sufficient to protect our country and its allies. do you agree that more needs to be done militarily? need the international community working with us and our military operations. our operations are basically air attacks to contain and eliminate isil. within syriability to defend itself and to go against isil. part of that is getting a diplomatic solution to the civil war so they can concentrate on isil. do we want combat boots on the ground? no. we saw in iraq, that was not very helpful. as king abdullah said, this must

be a battle by the muslim countries, not a western battle, to ensure they have a country that protects the rights of its citizens. david: we were seeing some footage of the french strikes over the weekend. in europe, you can move from area to area without a passport. do you see what happened on friday changing that ability? do you think that kind of inter--country transit is going to change? ben: there needs to be some more intelligent sharing. you need to know when there is a foreign fighter coming back to thatart of your country, that person is known and apprehended and taken off the streets so that person cannot commit terrorist actions. i don't think the confidence exists among european country that that is the case today. that has to change. david: after what happened on friday, how much pressure is there to act? are you and your colleagues able

to take stock of what happened, or is there pressure to change course in light of the attacks on friday? ben: we need to work on two fronts. what do we do in the middle east? is needed tosponse contain isil, but we also need to work on a diplomatic solution to the civil war in syria, which is very much optimizing our ability to go after isil. on the homeland security side, we need better intelligence sharing information. the president announce that today between the u.s. and europe. we need to be able to know where these foreign fighters are and apprehended before they can do harm in our country. extremelyt is an important part to protect the people of america. david: lastly, the refugee crisis is widening. 10 states in the u.s. have said and they will not accept syrian refugees. how much damage do you think the attacks in paris have done to the progress of refugees getting into europe?

ben: the humanitarian crisis is well understood. part of it is financial commitments by the u.s. and other countries, part of it is accepting refugees. in the u.s., we will only accept refugees who are carefully vetted by all our agencies, so we know their background, we know that they were not part of any terrorist network. we wish europe would use the same type of vetting process. obviously, with the numbers come in would be difficult to do. as far as refugee resettlement to the u.s., we will use strict vetting to make sure that anyone comes into our country has not participated in any terrorist activity. david: do you see any changes in funding for that in light of friday? ben: i'm certain some members will use this as justification to diminish the u.s. response. i hope that this country will continue to be a leader in dealing with the refugee crisis. david: senator ben cardin, thank

you very much. we will have more from bloomberg markets in just a bit. ♪

david: welcome back to bloomberg markets. i'm david gura. it is time to look at the biggest business news. raytheon and bolling will sell more than $1 billion worth of cell phones and spare parts to saudi arabia. the pentagon has said the state department has approved the deal , reflecting the deal to bolster saudi allies. american congressman wants to question for valid employees about the deal with philidor. elijah cummings wants to .uestion employees he sent a letter to the valley

of ceo requesting the interviews. microsoft will use its best selling computer game, minecraft, to teach kids programming. they are teaming up with code.org, which provides free programming software to children. you can always get more business news at bloomberg.com. let's go back to the market desk where ramy inocencio has the latest. ramy: can you believe we are at session highs right now, especially what happened with -- especially considering what happened in paris? here, marketsght have gone past 1% for the s&p and the dow. the nasdaq is not doing too shabby either, up by .8%. this might be a surprise after paris but there is growing proof that markets are getting even more resilient to terror attacks ever since 9/11. you can look into the bloomberg

terminal to get that story. me in my terminal, and you can see the health of the s&p. this is the imap function. all sectors are in the green. energy is up by 2.6%. they are being helped by consol energy, which is up by 7%. david einhorn reiterated a long on them today in new york. taking a look at oil and the roller coaster ride. it seems to continue today. nymex crude as turned positive. up by 2.5%. it had been up by 2.8% earlier today, and then it was done by nearly 1%. they cannot really make up their minds. says the world has a surplus of 3 billion barrels of oil. falling about 46% from last year. gold, we see the safe haven

where all of its gains from the earlier reaction that we got from paris. by .1% but experts are saying that any game that we did see for safe even investment would be short-lived. thank you, ramy inocencio. warren buffett today, looking at his stock portfolio, according to a regulatory filing, has trimmed their stakes in goldman sachs and walmart. the stake in walmart dropped to in number. joining me now is noah buhayar. why do we -- what do we know about why he trimmed his portfolio today? great question.

he came out publicly and said the reason for trimming those stakes was to get some cash in hand. he is getting ready to complete one of his biggest acquisitions aerospace parts manufacturer called precision castparts. he will be paying $30 billion for it. he wanted extra cash on hand to do that. i spoke to analyst and investors today and they said that did not totally out of. berkshire has more than $60 billion cash in hand, lots of businesses reducing lots of cash. possible me, it's buffet may have wanted to trim back the holdings and, when he sells something, sometimes the stock can take a hit. maybe this is a way of softening the blow. he is still a major shareholder in walmart and goldman sachs. you aboutanted to ask that broadly, when he makes a move like this, how it tends to affect the company's stock.

noah: it is not perfectly correlated, but news organizations notice, we talk about it on air. often times when he makes a major purchase, it can send up the value of a stock. when he sells something, it he could drive it down. the reaction today was a little mixed. goldman sachs was down, walmart was up. certainly, that is a consideration. he must take into account. david: going back to the acquisition of precision castparts. i understand standard & poor's was looking into berkshire's credit rating in light of that. noah: buffett has said he wants to use of more than $20 billion in cash to finance the deal. standard & poor's came on with a note saying they are putting berkshire hathaway on credit watch for a downgrade. they have not made a decision recentlyhey just decided to extend their review period another 90 days, so we

are still waiting for the final word. david: how common is this, for warren buffett to trim like this? i know he has professed want to hold onto stocks as long as possible. how rare an occurrence is this for him to trim the portfolio? noah: it is not too rare. it all comes down to opportunity cost. when he buys a business, like he is doing with precision castparts, he fully intends to hold it for ever. stocks, he likes to hold on for as long as he can, but he is more flexible there, and has been willing in the past to sell to make a purchase. david: anything else of interest in that filing with these two companies? noah: a couple other headlines. now a major shareholder in at&t. they were big shareholders in they supported the merger with at&t.

as a result of the deal getting closed, they are now a big holder of at&t. for your time,u noah buhayar in seattle. questions about the sony playstation network and its use in terror. ♪

there is some skepticism about how much isis supporters would be using something like this. there are secure and encrypted messaging out there, like telegram, the messaging platform that ice is used to claim responsibility for these attacks.

it is much easier for them to communicate on those. it is difficult to know what kind of success law enforcement has seen in tracking down terrorists in game networks. david: you look at the array of gaming platforms. does sony standout, offering more capability? emily: it is because it was specifically mentioned by an intelligence official in belgium. but it has also been pointed out that the microsoft xbox, you can do the same communicating. call of duty, activision has, previously saying they don't allow intelligence officials to monitor gamers on their platforms. if they were monitoring u.s. citizens, they need specific permission to do so. very murky but could present another opportunity for these guys to communicate sight unseen. david: you look at sony the corporation, any history working with governments when it comes to this situation?

emily: sony found themselves in a difficult situation with a hack attacks, they have to communicate with law enforcement, respond to those requests, but they also have a difficult line to walk when it comes to the privacy of their users. if you are looking at 110 million users, the vast majority of those people are not doing anything wrong, so they have to weigh those concerns. david: thinking back to second life, a place where the government realized all of this action was happening and they had to show an effort to find a way around it. emily: another one of those old-school virtual reality games where apparently there has been some good fodder for potential terrorist communications. again, we don't know. that is why the cia and fbi are looking into it. something that we will dive into more on "bloomberg west." on the one hand, you have people

opening their doors on twitter providing shelter to people in paris. on the other hand, i ran one statistic, 90,000 accounts on twitter by isis supporters, not all active. twitter is also a place where they have been communicating. david: thank you very much. emily chang, anchor of "bloomberg west." ray kelly weighs in on the terror attacks and when it takes to keep the city safe. ♪

forgive him in new york, 9 p.m. in paris and 9 a.m. in hong kong, welcome to bloomberg markets.

from bloomberg world am ready luke. here is what we are watching this hour. french president francois hollande calls for a united front to defeat the islamic state following a devastating attack in paris. >> we will eradicate terrorism. terrorism will not destroy our republic. long live the republic. long live france. we speak with ray kelly about keeping the streets of america safe. stocks surge higher. the s&p is on pace to stop its three-day slide as traders away the implications of the paris attacks. and