♪ scarlet: good afternoon. alix: here is what we're watching at this hour. partial remains of lockdown as police carry out raids in an attempt to stop a terrorist attack. seals the deal would allergan. a $150 billion merger, and the biggest and yet in using a controversial tax strategy. ratesan expected raising get an expertt we opinion. scarlet: let's go to julie hyman for the latest. it looks like we are extending this winning streak.

year --e had the best week of the year last week. all three major averages are remaining higher even if it is only marginally so in terms of macromedia's we did have data sales.the existing home we had a decline for the month that was larger than had been estimated. that is largely because of lean inventory. not as many houses out there as people want to buy. at the same time however, we have holding permits last week that showed we could see boulders staying busy in the coming months. existing home sales pulling back a little bit from a high level. touching a two-month high. the homebuilders themselves have been doing relatively well doing

-- during the session. it really feels like commodities are what are leading the day. i was talking about it last week that based gold medals continues to be hammered. the longer-term correlation of oil and stock is not necessarily high rate but on an intraday basis but if you see oil reversed during the day, you tended to seek stocks going in a similar direction. that happened today. oil spiked, came down, and spiked again. that was when we saw stocks recover because energy stocks were not being hit as they were earlier in the session. commentsme reported from saudi arabia that the nation is willing to collaborate more with opec on stabilizing prices. it appears to be helping oil

prices. metals, a loss of carnage there as we continue to see multiyear lows. alix: i would put money on the fact that opec would not quit production on december 4. i will see. five dollars. julie: i would not take that bet. scarlet: i am good. alix: let's take it to the first word news. mark: thank you. a city of brussels is under lockdown on this monday. fears of an imminent terrorist attack. schools, shops, and the cities subway system remain closed today. police across belgium are searching for an islamic state terror cell. the belgian prime minister warned that they expect a terror style attack with multiple attacks pleasing taste -- taking place at once.

what is the latest? >> hello. we still do not know what the latest is because the national are stillouncil locked in their meeting. they have been in there or three hours. people do not know whether schools will awaken many universities will overcome of the subway system start running. all of that has been a lockdown today. inwill be that way tomorrow my opinion, but we do not know. they are deliberating. they are finding out if he threats is so bad that they cannot run. mark: what do we know about the business community of brussels? whatever they've been telling the government, in this state of emergency? the trouble is it is not an

official state of emergency. it just seems to be going from one day to the next, deciding what the threat is. businesses are not happy. we spoke to restaurants on saturday night we won said we have had 80 cancellations, normally we would be packed. we have nobody walking the streets, we have had to close our doors. supermarkets, department stores are losing money by the day because people are too scared to go out of their houses. they are calling on the government to make a decision. to say if it is safe to start operating again like normal. mark: joining us from brussels, thank you so much. word look atirst news right now. you can get more on these and other breaking stories 24 hours a day. that is a new bloomberg.com. back to you. scarlet: thank you. that $160 billion merger. the deal creates the biggest drugmaker in the world rate

annual sales of about $60 billion. products include viagra and boy talks -- botox. scarlet: joining us is drew armstrong who has been following this from the beginning. do we have any idea what this gigantic pfizer will like to hear -- will look like in two years? an interesting question. they have talked about splitting into two companies. this gives them a little closer to being able to do that. they had been saying we could do this as soon as 2017. they push that timeline back by about a year to 2018. this important to think of deal with allergan as merely part and parcel of their larger strategy. that is eventually to get bigger up bigger event break itself into two companies with a little more separate identities. one of older medicine, some

generic drugs, and very innovative research and develop projects. alix: what other questions do you have for management? bloomberg intelligence say they want to see that $12 million worth of wimax in order for this deal to add to earnings in 2018. what is on your writer for what is left unanswered? we are trying to figure out exactly what his role will be going forward and the ceo of outlook again, he will be operating as the coo of the combined pfizer and allergan. he has a ton of responsibility for commercial, for strategy. but people have talked about as dash cam as a potential company. to lead the it will be interesting to see how his role develops, is there are other people he may be thinking about or if this is a guaranteed thing. how this deal was negotiated, i'm curious of that. while you were

speaking, we just got word that the m&a that we have gone this year has now a needed the annual record rate of the annual record had been 3.4 trillion dollars in 2007. we're now at $3.2 trillion. alix: as for my see in 2009 when bought and tee up. when glencore bought extra out of. but those deals signaled the market top in the quantities they were buying. does this sound similar to you? --w: i was just this morning in some ways this is the biggest pharmaceutical deal of all-time. ago, years ago, four years a 10 billion dollar deal would be an extraordinary thing to happen. and now over the last year and a half in the drug industry and

other places in health care, i would of every morning to one of these. it has been an unbelievable time of consolidation in the biotech industry, and the health insurance industry. hospitals have been merging like crazy. amount of deal activity that has been going on in this sector. it is nothing i have ever seen. everyone we talked to says this is going to continue. they ask what happens if they raise interest rates? tois not necessarily going change the position for these companies in a meaningful way. the fundamentals have not changed. if anything executives are waiting for the stocks to get cheaper on the market. it makes them easier to do for an m&a perspective. we could be seeing more. there are a couple of more mondays in the year to go. there's the health care retail channels like walgreens and

write it. what other parts of the health care industry has yet to see consolidation? has consolidated everywhere. there is no one who is not been touched by this trend. i will say that we probably will continue to see a lot of activity in biotech and people are looking to see lots of catalyst in the pipeline for all of these companies. what else is interesting for big drugmakers to buy. everyone is chasing the scale. i would not be surprised if we this text version. a 35 percent corporate tax rate. i would like to get out from this somehow and i do not trust that congress will take action. you are looking at one of the targets of significant scale abroad that would allow you to do that as the menstruation does everything to it can to limit these transactions.

one is left out there? there are other companies left out, a handful of others who have not converted. pfizer will not be the last company to do this. scarlet: thank you. great perspective. drew armstrong reported from washington. later today at 2:30 p.m. we will be speaking with sylvia matthews are well from the department of health and human services. alix: it is the dawn of a new day in argentina. overhaul to undo years of currency controls. we will look at what it means for investors. scarlet: jack ma is taking a page from fellow industry tycoon rupert murdoch. why he is considering a stake in an unprofitable newsmaker. alix: the federal reserve governor tells us what could sway the decision to lift off. ♪

alix: welcome back to bloomberg markets. scarlet: let's go to our markets desk. a check on company movers. julie: let's start with tyson foods, the big meat processor. the company shares are surging. come out withthey earnings that beat estimates, having everything to do with chicken. ef business is struggling, but the demand for chicken is helping matters as is the idea that feed prices are declining. take a look at my bloomberg terminal. take chicken wings as one example.

prices of the past year are down about five or said it would not be a great thing for tyson, but at the same time corn prices are done 2.5%. soybean prices, the other may component is about 17% down. andprices are going down demand for chicken is going up. chipotle the -- t lost 12% on friday. some analysts are saying this is a buying opportunity. maxim group is upgrading the anera to buy.p alix: thank you. election ofentina's a conservative leader marks a movement for investors.

he campaigned on the promise to over haul the ailing economy. alix: investors are happy rate participation, it fell to an eight year low. the stock market rally to a record high. bruno, andnow is our bloombergs intelligence reporter. do you expect to see the inflows we have seen over the past two days to continue? >> idea. there is a lot of excitement from the investment community about the elections. investors were looking for change. this the data that is very strongly looking for change, some of the policy changes. scarlet: he is very ambitious. he actually won a very small

margin of victory. does that mean it would diminish his effectiveness? >> i do not think so. govern does not depend upon the margin by which he won, but his ability to negotiate with leaders on the key policy reform seems to implement. i think he needs a position to hethat because given how still has a lot of leverage to influence congress through the provinces, because they depend a lot on the discretionary funds. negotiation, some and it will be pragmatic. alix: how long does he have until he loses credibility for not getting things done fast enough? >> he just needs to make the right announcements from the start. potential good thing

going for him is that expectations are very low. i think one of the things that this is a very negative campaign in the first round. it let a lot of people to believe they might lose their social benefits. that there would be a backlash and the world would go back to financial crisis in argentina. i think that that might be a blessing in disguise because by making some sensible changes he expectations that he would have a very taxing social policy which we do not expect. scarlet: we have seen the election of a reformer that the global investment community really gets behind. they wait for things to materialize and we have seen a big jump in etf tracking. does that reflect the successful

election? what about the share prices? ares a lot of the policies going to take some time to be implemented. we didn't see -- we didn't see the run up on the market pretty significantly. in argentina as well. this person will really open up the market to investors and the national community. open up trade which is very important to the economy of argentina. about layout the stock market in the upcoming years. chinese demand, the routing commodities, if we see a recovery in argentina, do we see it in the emerging countries? >> in an investment basis we see it already. a very significant investment in

.rgentina other investors jumping into argentina. .ut merely a substantive demand it is so restricted in argentina right now because a lot of the , any changes to that would be a net positive. notlet: implementation is critical for the new president. what will you be watching for in the coming weeks? hea point would be that makes some cabinet announcement so that we know who will be an charge of implementing economic policy. and then the first announcement they make in general terms. they will have to announce a credible reform of the statistics. a fiscal plan, i financing playing, monetary policy plan. lift toer that, i will -- go to lift currency restrictions.

scarlet: any policy he might have to expend? >> he will need to continue the social policies of the previous administration. he said he will make some changes to the way those policies are implemented and evaluated. but not necessarily expanded. there are many expectations. alix: thank you so much. much more coming up on bloomberg markets. jack ma following in jeff bezos footsteps? ♪

scarlet: welcome back to bloomberg markets. to buyack ma is in talks

south china's morning post. scarlet: this is something that emily chang asked mom about earlier this month. >> we need leaders to help our small and medium-size companies. and our advertisement dollars are huge, gathered from small business, using our data, they can tell the economy to go the right way. companies.ng many alix: what changed? our reporter from san francisco. what changes in a week? >> i do not think anything changed, and he was being a little coy a week ago. but the rumors were out there the alabama pictures group,

there have been investors in department stores and electronic games. confidence, almost arrogance that alibaba can come into some of these once glorified franchises and restore them to former glory. can investigate newspapers pay off, like for jeff bezos? certainly done a good job with it. the circulation of the post now exceeds the new york times online. amazon has been using the post to strategically further their own interest. they are looking at that and thinking of similar things. alix: you and think that companies would be trying to get an online instead. forget brick-and-mortar, we will go digital. why now? >> we cannot dismiss the political influence that papers

have. it is a small circulation, but enormously influential. fall in love with the government, but do not marry it might be relevant here. increases as influenced by buying into a really well known influential franchise like this. scarlet: good stuff. in an as init was the south china is that i found my job at bloomberg. alix: full circle. coming up we will talk about the u.s. economy. ♪

alix: welcome back to "bloomberg markets." scarlet: let's start with the

headlines. let's check in with mark crumptos. alix: this monday, things are going well. matt: in belgium, five people a been arrested following police raids across the country and more than 20 suspects are now being held. the belgian government has warned that an alarming state terror cell is planning a paris style attack in brussels. the belgian capital is now in its third day of a lockdown. schools, stores, and the subway system are all closed today. nato's headquarters is feeling the effect of heightened security in belgium following the terror attacks in paris. some alliance staff members are being asked to work from home and external visits and visiting groups have been canceled. on saturday, belgian authorities raised the alert level in the brussels region to the maximum level. british prime minister david cameron wants that u.k. to join the fight against the islamic state in syria. p met with the french president

in paris today. right to takely decisive action to stop terrorists when they are threatening the lives of innocent citizens. the united kingdom will do all in our power to support our friend and ally, france, to matt: this evil. he will meet with president obama at the white house on tuesday. an islamic militant groups is only 2 gunman carried out the attack last friday on a hotel in mali. a statement was received claiming responsibility for the attack. it identified the two gunmen on the scene and some witnesses and officials thought there could have been up to 10 gun man. drivers planning trips during the upcoming holiday has something to be think of for. the price of gas is $.70 lower than it was era go. the national average for a gallon of regular is down $.11 in the last two weeks at $2.14 per gallon.

that is a look at our first word news. you can get more on these and other breaking stories 24 hours per day at the new bloomberg.com . back over to you. scarlet: thank you so much. the markets reacted strongly last week when minutes of the latest that many revealed enough confidence in the u.s. economy for a december rate hike even if it's a small one. scarlet: daniel tarullo joined us early today to talk about what impresses him about the was economy. >> kit has shown by the latest jobs report that it seems to be chugging along with modestly above trend growth. some of the fears that many august and in the early september time have not been realized. having said that, i think it's still a mixed picture. -- we seeing can send you are seeing continued improvement in the translation, it's still one where there is uncertainty.

obviously, we are still not meeting the inflation target and are not close to meeting the stated inflation target of the fed. there is a school of thinking that depressing effect of unemployment -- of disinflation from the dollars less transitory and that as those forces dissipate, there will be a push up in inflation as the output cap narrows and there will be a push up. others, myself included, have thought it might be better to wait for some more tangible evidence that we are going in that direction. . stephanie: what about the fears around unintended consequences of rates being so low for so long? >> you want to watch whether those unintended consequences are being realized. there can be unintended consequences of any policy action or failure to take policy action. that we in analysis

the fed collectively but each of us individually have been doing for the past several years are whether the risks to inflation and financial stability and balanced andughly whether accommodation and more accommodation is appropriate or less accommodation is appropriate. i want to say that as i noted at the outset, probably too much attention is being paid to particular months and particular meanings and not enough attention paid to what will be the trajectory of rates when we begin to raise them. with respect to inflation in particular, when we do raise rates, i think it will be particularly important to be watching carefully for the effect on inflation and whether the expectation that inflation will continue to rise back to 2% are being met or not being met. david: talking about that pathway beyond what happens in december, it's the end of 2016,

where would you expect rates to be an inflation to be? going to give a personal prediction because i don't have to until the december se i will point you back to the septemberp. participants the in the fmo say. -- fomc. you can see the norm was for three of four incremental hikes over the course of the year. back toation, still not 2% by the end of 2016, not close. in our senioring bloomberg and analyst. >> we know he is among the more dovish members of the fmo see. he has accepted that left office likely happening in december.

i don't think there is a consensus on what the trajectory of rate increases will look like in 2016 but we have heard across the spectrum of fed meeting participants that they are ready for liftoff in december. scarlet: paul moore more lee says perhaps the fed is too late and they should have raise rates sooner and are being caught flat-footed because inflation will pick up relatively quickly once they begin liftoff. are more people starting to move to this idea of thinking? >> there is a significant share of market participants who subscribe to that view. i think with that mrs. is your asymmetric risk of the fed. in normal economic circumstances, they probably would have been satisfied to orrt hiking policy in june september. however, in the unique environment we are in more most global central banks are pushing up against a zero balance giving a higher hurdle to add

additional stimulus, it's a different environment and therefore i think the policymakers have been inclined to let the economy run a little hot. the best insurance against having to cut rates in the future is keeping them lower for longer now. -- that from them a whole host of characters i think that is correct. alix: i continue to read what is the real interest rate. how low is it? what will be the right interest rate over the next five or six years, the new normal? what is the policy risk you see as the fed begins to hike? as we saw in the minutes of the last meeting, there was an extensive -- an extensive discussion and no consensus region where the neutral real interest rate is. normally, the neutral nominal rate would be about 4% or maybe 3.5%. policymakers seem to think it

could be significantly lower than that. if they are cognizant of this problem, that argues for them to move even more slowly when they start hiking. about4-5 rate , hikes were penciled in. i think we will get a much softer modification in the december meeting may be signaling only 2 rate increases. alix: so the dots will come down. scarlet: what happens in 2016? what happens when a whole new group of people come in for voting members? which way will the fed start to lean? >> you have a slightly more hawkish rotation next year but i don't think that will significantly increase the cost of policy. sentsght mean you get 2 dis that there is still a dovish core. will't think that

significantly impact the course of policy. alix: how concerned are investors on what to do about the fed's balance sheet? they signal they would consider changing it or letting the reinvestment run off once it started to hike. will we get clarity of that in december? >> we have to get some clarity at some point in the future but i don't think there is a need to do it in december. there has been some hand in public comment that the fed would not address -- begin to unwind the balance sheet until they get closer to 1%. if we are talking 2 rate hikes next year and one in december, we will have this discussion next year but not in the next couple of months. to let would like the market no advance what the policy will be in and i don't think they have reached a conclusion yet. alix: thank you so might, it will be an exciting couple of weeks. scarlet: coming up in the next 20 minutes, the best way to tested debatetly

on a missions. what is the best way to deal with this issue? alix: the new york rangers goalie let his national team to olympic gold in several men are so what's next for the hockey star? scarlet: home sales have climbed more than expected last month and we will break down the reasons. ♪

scarlet: you're watching bloomberg. alix: this is your global business report. here is what we are watching -- a massive deal in big pharma is

official -- does the pfizer/allergan transaction signal more conversion? scarlet: internet latest tycoon, jack ma is eyeing a 112-year-old newspaper in hong kong. pfizer and allergan agreed to combine in a $160 billion bill -- deal. that will have a tax address in ireland. the pfizer ceo says the deal will help counter foreign competition. >> a combination with allergan is the right opportunity for pfizer because it optimizes our capital structure by giving us substantially improved access to our existing cash and future cash flow and expanding our ability to make an investment in the united states and leveling with ourng field

foreign competitors for a more competitive tax structure. argentina votes for a big change in the opposition leader has been elected president setting the stage for economic liberalization and improved relations with the u.s. he has promised to lift the currency controls and attract international investors. governor daniel tarullo says economic data that's come out since september has been mixed. he said continued low u.s. inflation tempered u.s. and busy as him in lowering unemployment. >> i think it is still a mixed picture. we certainly see continued improvement in the labor market but the environment for inflation is still one where there is a lot of uncertainty. scarlet: finally, alibaba founder jack ma buy a stake in a hong kong newspaper. advancedns are at an stage in the newspaper was once

the world's most profitable newspaper but has followed the path of other newspapers with falling readership and tracking circulation. quick whereor our we help you get smart fast on an issue in the news. the focus today is carbon pricing, a hot topic for the upcoming climate change talks in paris. here is the situation -- carbon dioxide emissions are choking the planet but we still need to burn fossil fuels. the question is -- how do we tax the industry without putting it out of business? there are two ways countries are doing this. you have a flat carbon tax which is simple and if you pollute you have to pay. mexico has a tax of three dollars per metric ton and swedish taxes $150 per metric time. the goal is to get the tax high enough to get companies to act but not so high they close their doors or relocate. the other solution is cap and trade. government set a target for

pollution their economies can tolerate and then distribute or sell individual rights to release co2. the ideas if you clean up, you will have more credits and you can sell them in the market. there is a debate about which approach is better. the issue with cap and traders you get a mission cuts no matter what which is good and the free market finds the cheapest ways to curb pollution. the problem is carbon markets can be very hard for governments to regulate. the eu was the first to require a missions permits in 2005 but when the global recession hit, energy demand fell creating a glut of these permits the cause prices to collapse. to price has crawled back $8.55 per metric ton. 30 countries or jurisdictions have developed a plan to start these cap and trade systems like california, new zealand, and china but the price is probably not high enough to change

behavior. 15 others have a straight up tax in some countries like the u.k. and most of scandinavia have both cap and trade as well as taxes on really dirty fuels like coal. scarlet: thank you. for more global business stories, visit bloomberg.com. go to abigail doolittle live from the nasdaq. >> at the nasdaq, we have stocks trading basically flat, modestly higher, but we have been watching one group go significantly higher and these are china-based stocks. there appear to be a few things at work. one analyst is out with a macro note saying the macro rebound for the all country world index could be a tailwind. she highlights baidu which is up nicely as well as seatrip.

quarter gain.st she does not highlight or mention specifically j.d..com. ons stock is up nicely followthrough to its record single day earlier this month. comings that momentum is back to the china-based stocks and most are trading above their 200 day moving average and something that could be considered ironic in light of the commodity selloff. alix: thank you so much. scarlet: coming up, the national hockey league is the international game of north america and we will sit down with henry lundquist next. ♪

alix: welcome back.

the national hockey league is better positioned than the u.s. other major professional sports to capitalizing globalization. 25% of its players were born in other countries including new york rangers goalie henrik lundqvist. he is a hero at home after lead desolating the national team to a limbic metal but is putting down personal and business roots in new york. i sat down with him recently and asked where he plans to settle in his playing days and? >> that is the biggest question. me and my wife talk about it if we moving back to sweden or staying here. it's a big difference when it comes to lifestyle. and a lotove new york of the u.s. and the lifestyle is here and i could see myself stay in new york i think that will decide also what i want to do after my career. scarlet: vanity fair and people magazine have named you as one of the best dressed athletes in professional sports. what are you wearing today? >> today iszcegna.

scarlet: what will you not wear? >> you can't go wrong with anything in new york. it's easy to blend in. that's the beauty of new york, you can wear whatever your wants and people don't really care you can be who you are and be comfortable. scarlet: you are known as a positional goalie with a structured approach. how would you describe your investing approach? >> i don't like taking many risks. it's more about securing the future. it reflects a little the way i play. i don't over challenge. i try to be focused and be in good position on something that happens. scarlet: in investment, you learn more from your losing investments than your winners. if you were to apply that to hockey, what have you learned from the last years of getting really close to the stanley cup? >> you just have to be able to let things go. you make a quick analysis when things go bad. being able to be level mentally all the time is key in the playoffs. it's intense and hard.

scarlet: are all your t3 look? >> they are real. scarlet: is a hockey marketers dream. he still has all his teeth. he will be a major drawing card for the 2015 world cup of hockey. alix: here is commissioner bill daley. scarlet: the world cup of hockey is a joint effort with the nhl and the players association and the international ice hockey federation. usually we see these two at the bargaining table. there have been two player lockouts are the last couple of years. as a challenging to work together to get this permit sorted out? >> i don't think it was, we have a long tradition with the players association on the international business ventures and they have been our partners at the international business table. for the world cup of hockey, it was more of the same. think we are probably more aligned with their players

association now than we have been since my career started. that has to do with our business model in terms of we share 50% of our revenues with the players. are 50/50 partners with everything we do and they understand that helping us grow the business is in their best interest. internationalo and the bulk of the players come from the u.s. and canada but increasingly, we have seen more coming from russia and the czech republic and even sweden. whenever hold the world cup of hockey outside north america to help monetize your global presence? world country staged in 2004 and 1996, we had games hosted outside north america. years and by the time we have this world cup of hockey. we felt to give it the best chance to be as successful as a could possibly be, we should put

it in the center of the hockey universe which is toronto. we hope and plan to have future world cup tournaments overseas as well. first kicking of the new can of the world cup hockey and we wanted to be as good as it can be. scarlet: players like henrik lundqvist are very excited but it's still not the olympics. >> i hope so, that's the plan. i still think the olympics is the biggest platform for hockey. scarlet: you want a gold medal there in 2006. it was a great experience and when you get an opportunity to play for your country, it's a special feeling. also a the world cup is great step in the right direction to try to keep building the brand of hockey and try to reach new fans. alix: what is the future of the nhl and the olympics? >> it still to be determined. we have a lot of olympic experience now going back to 1998. we have participated and

shutdown hourly to participate games. separate winter the next winter early the gains in 2018 are in south korea. the following winter olympics were just awarded to beijing, china. opportunity isan something that excites us to a certain extent. certainly, the awarding of the olympics to beijing created a new level of interest in terms of trying to make the elliptic equation work. it's challenging. shutting down the season halfway through to play games half a continent away, it's challenging. alix: thank you so much. scarlet: coming up in the next hour, the latest raid on the u.s. real estate market, stay with us. ♪

it is 1 p.m. in new york,

6 p.m. in london and midnight in hong kong. scarlet: from bloomberg world headquarters, good afternoon. alix: here is what we are watching at this hour -- belgian is on hilar as police hunt for a suspected terror cell elite to be planning terrorist attacks. scarlet: existing home sales fell more than expected in october. are the homes becoming too expensive or buyers? alix: what you pay $19 for a ticket out of hair por -- airport hell? scarlet: let's go over to the market desk and julie hyman has the latest. it seems that the impact on existing home prices are not having the effect on the market we think it should have. stocks are in the green but it's sort of a mixed session.

taking a look at my terminal, energy is now the best-performing group in the s&p 500. oil prices have recovered. is also staples contributing significantly to the gains. utilities on the downside as we see a race to the shorter end of the curve working higher. it's an interesting dichotomy we see. we want to dig into consumer staples. son foods is rising after they beat estimates and kellogg's is gaining after credit suisse up graded the stock. also gottion brands an upgrade. consumer staples a big part of the rally, such as it is. we have the fed governors coming out of making headlines. julie: we had dan tarullo talking about being concerned about low-inflation. it seems as though we see more of a reaction to john williams,

president of the san francisco fed against the notion that december looks likelier than not. we have seen a reaction in the euro which is trading sharply lower, it's at his lowest since april versus the dollar. we have also been watching the bond market on these fed governor remarks. the 10 year yield is a little bit lower today, 2.26% but it's not a big change but the two-year is where we see a reaction to any kind of fed commentary. it's 0.93%. i believe we have seen that yield rising for about six sessions in a row as we have things taking root that december is more likely. movinghe two-year was before this came out but was it at 1%? thank you so much. scarlet: let's get a check on first word news. matt: thank you. mark: police and belgium have

arrested more than 20 suspected terrorists. they cannot find the man authorities believe was behind the deadly attacks in paris. the city of brussels remains locked down, schools, stores, and the sun we are closed. the belgian government warns that a paris style terror attack is imminent. let's go to our brussels bureau with the latest. the streets are still quiet this hour? absolutely, it is about 7:00 p.m. now. people still have no idea whether shops will be open or the subway will be running or they can get to their companies to work tomorrow morning. the national security council are still locked in a meeting and have been there for four hours. they are discussing whether they can allow the arrangements they put in place since saturday to

stop people going outside to the subways in gathering and large numbers. as yous no word yet, say, they still have not found the chief suspect involved in the paris bombings from 10 days ago. fact that her, the is at large, that means that a lot of brussels is paralyzed by fear. subways are not running and we still don't know whether schools will be open tomorrow. you give us a sense of the nato involvement in this manhunt? nato headquarters are in brussels. >> that's right, nato is based in brussels. their offices are here and they've got absolutely no involvement in the investigation itself or hunting for the suspected terrorist. that is the job of the belgian national police. it's a worry for nato to have so many u.s. citizens based in brussels being told that you cannot get on the subway, you should not go to work perhaps,

and that is a worry and that's why the u.s. embassy over the weekend said people should shelter in their homes and not go outside and it's necessary. you, what doesk this mean for the mindset of the people of elgin? is there a sense of the people being annexed that the terrorists have one? >> the people of belgium are pretty tough. they are not easily cowed into submission. there are still people out there walking around in bars and cafes. over the long term, life will return to normal and belgium will say we are not going to let them beat us. mark: thank you. that's the latest first word news. you can get more on these and other breaking stories 24 hours per day at the new bloomberg.com . alix: thank you so much.

scarlet: fewer americans bought homes last month in existing phone -- home sales fell after hitting the second highest level since 2007 in september. alix: some of the largest declines were in regions that have the biggest price gains. the chief economist joins us from washington with more. what is the reason? is it supply or demand? >> let's call it all of the above. the widespread downturn was surprising and somewhat abrupt from what we saw in september. what we see is that writers are reaching the top of their budgets in terms of what they can buy and we see a transition in the market away from the move of buyers who have wealth to put in the table and towards first-time buyers who have less bargaining power. at the same time, sellers of not been willing to budge. ist we saw in october

evidence of a still made between buyers and sellers. will that be resolved in the future as they get on the same page? scarlet: there are also new mortgage regulations in place in october with more paperwork up front. did that gum up the works in the short-term? >> it is still too early to tell. real estate agents say that slowed down some deals that were expected to close in october and were pushed out to november or we could see more delays as the title companies and banks work together to figure out these new regulations. the other external factor is the possibility of an el niño where the winter would be warmer. what would be the effect of this in the housing market? >> hopefully, the biggest effect would be seen in housing starts which we know are underperforming relative demand. housing starts took a step back last month. let's hope that winter weather would increase those builders

breaking new ground. let's also hope it means that buyers are still looking for new homes. we see a huge surge in the number of people going out but it is not often translating into people making offers. what's needed is supply so we get more supply, we know the demand is there, and maybe offers and sales will follow. scarlet: why are those visits not translating into offers, is it pricing? >> the best way to describe it is what an agent told me last week area and people nowadays are looking for a good deal, not necessarily a good house. there is a difference. with prices going up so high, many people cannot afford to buy. they are looking for that deal, something that would lead to increased appreciation going forward. that is a shift in the market that we are just starting to see. alix: what kind of power do the sellers have for squeezing out concessions from buyers? has that reached its max? >> to be successful as a buyer,

you have to give away a lot of concessions to the seller. that involves waving inspections or waiting financing. as we go on and on in the cycle, fewer buyers can do things like wave financing especially for a first-time buyer. you cannot wave financing. l you are dependent on an fha oan,, you cannot wave an inspection. october big increase in and buyers willing to concede to sellers but i don't think we will see this going forward. scarlet: the final question -- is there anything you see that is not captured by the commerce department or the national association of realtors? >> we see a lot because we see in the market. people are windowshopping and fewer are willing to close on the deal. there is a hesitancy that we had

not seen here before. we wonder if that hesitancy, that anxiety about the market on the part of buyers will translate into slower sales next year. alix: thank you very much. scarlet: much more coming up in the next 20 minutes. the london metals exchange has fallen to its lowest since the financial crisis of 2008. alix: at least the trade has. you want to a debt to the times or die. it was not a hard choice for deluxe. we will find of the company strategy and how it is seeing growth into its centennial. scarlet: as brussels continue its third day of luck in, as the city economy felt the impact? we will get the details. ♪

alix: we are looking at live pictures from a press conference in brussels where the belgian prime minister is commenting on the security situation there. the city of brussels is under lockdown because of fear of an -- ofe -- of an animate an imminent terrorist attack. scarlet: they expect a peristyle attack with multiple attacks taking place at once and this is the third day the city has been locked down. alix: we will continue to monitor for any headlines and bring them to you. scarlet: it's time for the bloomberbusiness flash with a look at the biggest business stories. petro bromley issue $1 million in securities backed by future revenues. the brazilian oil giant has $24 billion in debt coming to in 2016 and 2017. the plan would create a special purpose vehicle to issue the securities and as a way to protect bondholders. ma is set to buy a

stake in the south korea -- in a hong kong south morning post newspaper. earlier this month, he may have tipped his hand in an interview with emily chang. media to help our small medium-sized companies to way, it'sd, by the huge. we gather from small business and can help the media. can tell data, they the economy enough. >> are you going to buy the south china morning newspaper? >> i did not say that. alix: a sale would make him the latest internet tycoon to pursue the revival of a traditional newspaper. scarlet: former employees of were convicted of aiding his ponzi scheme but the

theirdecision to reduce sentences do not that -- does not affect his prison sentence. you can always get more news on that story and other business news at bloomberg.com. alix: let's go over to our markets desk and julie hyman. julie: i'm looking at gaming. i have bad news that has to do with "star wars," the game associated with the movie. alix: we own it. apparently not enough people are like you. gamestop came out with earnings that missed estimates and it blamed some of the shortfall in part on early sales of star wars battlefront for it it just came out so it's a forward-looking indicator. -- halo 5 isnot

not selling as well. there is a ripple effect in the industry. other game makers are falling today. , electronicblizzard arts, we see a migration of gamers to more mobile as well. that is something on a secular basis. it is affecting the gamestop business. we've got the supply chain, splc , what companies are most reliant on gamestop for their sales. take two interactive's reliance on gamestop getting about 21% of its sales from that mpany. arts is 11% and nintendo is 10%. it's tricky to read that those of the companies that are quite reliant on gamestop as a main selling channel. if their sales are down or disappointing, that is not proving to be good news for the other stocks. scarlet: thank you so much.

row gige metals getting deeper. it's slipping 27% this year which is the most since the global financial crisis in 2006. if you take a look at zinc, copper, and go, it has been a horrible time for these commodities. zinc in particular -- nickel is at its lowest level since 2003. here,n see that around you have the green line which is nickel. its lowest level since 2003. where cutting supply in zinc and not seeing the kind of response you would expect in prices. are we looking at a weaker demand story? is that what is driving commodity prices over the last few weeks instead of supply? scarlet: the supply story is

pretty well telegraphed. when you look at oil, opec has a meeting coming up december 4 in vienna. hedge funds are betting that opec will not do anything to boost the price of oil above $40. they say they may raise quotas to accompany -- to accommodate indonesia. tox: iran says they want have room made for them when iranian oil starts coming on the markets of that's a lie story continues and demand has to be that much better. ahead, theill checkbook was invented a century ago but with mobile deposits and online shopping, how can do locks survive? -- how can do locks -- deluxe survive? ♪

scarlet: welcome back. the beer of the checkbook over? the company that created it says no.

the check book company deluxe has overhauled its services to include marketing services and is celebrating its 100 year anniversary today. scarlet: carol massar and cory johnson it more. carol: we welcome everyone. this company is celebrating its 100th year anniversary and they did so at the new york stock exchange today. let's bring in the company ceo. deluxe and we all have checkbooks but i've don't write as many checks as i used to. your founder created checks as we know it today. talk to us about the business. is it growing in this environment? no, it's a declining business for us but one of the smart things we have done as part of our transformation is we figured out how to gain share in a declining market.

that has been one of the catalysts for our transformation. we are getting stronger even though it's a declining market and doing better and winning share in the financial institution market and the small business market. cory: to what end? eventually the market will catch up with you. what do you do with those successes and where does it lead you? businesses like registering websites which have low margins. >> it is a very profitable business for us. through our small business, more access point tos the online but major account markets and we have a distributor on the street market. we can get the check business to be bigger with an small business. we have won banks. take of suntrust , citizens,zion's bank and by

winning those deals where you would stem the rate of decline and that has been at a big foothold in our starting transformation. carol: you do logo design and web services and fraud prevention. what is the fastest-growing and most profitable business? >> they all are. if you think about the small business marketplace, we do everything for websites to printing to marketing. we host 910,000 websites for small businesses today. where growing an e-mail marketing we are growing in search engine optimization and search engine marketing. also on the financial services side, we have been filling out our portfolio to add more than just the check part of the business. think of us as a financial institution. you are trying to get consumers deposit account holders and help them acquire those folders and we want to do marketing and engage them.

you think of engagement being the check part of the business but what we have done is we bought pieces of the portfolio in to bring in direct marketing, print marketing and analytics, and then we engage the consumer with the financial institution. we bring them the checks they want and we help to retain. we bought a rewards and loyalty company. citibank is one of our largest customers and verizon is as well. the rewards programs they are running our deluxe rewards program. cory: talk about fraud prevention. i look at publicly traded companies which have a hard time garnering and keeping fraud protection clients. try to put fraud protection around your checking account. it's an important baseline product for us. then we add identification theft protection.

what we help the banks on is screening services, something called deluxe detect. if you walk into a branch is a teller, we help with a screening service which says carol is a better fraud risk then cory, for example. carool: that's a given. you have acquired different kinds of businesses. will you continue to acquire businesses? when you have been a check company for 95 years, we knew we needed to find different areas rusted get into. yes, we think it will supplement the organic group debt growth we are thing to get we also stay in that business of acquiring as it makes sense as we keep organically building the company. carol: congratulations on 100 years. scarlet: thank you.

i use a lot of checks now because when you have to pay to anything related to your kids in schools, they only accept personal checks. alix: that's good to know. i have them. had, belgium is extending its highest threat level for brussels. is belgian prime minister updating the security situation at a press conference in brussels. the city remains under lockdown for a third day and we will bring you the latest. ♪

alix: from bloomberg wealth -- world headquarters, welcome back. scarlet: let's start with the

headlines --mark crumpton has those. mark: thank you very much. belgium has extended level three which is the second highest threat level for the rest of the country. that's according to the prime minister. he is speaking to reporters in brussels. this is as the city remains on a lockdown. belgian authorities have charged a fourth suspect with terrorism offenses and have detained 16 people on sunday. federal prosecutors said the suspect who was not notified -- was not identified was charged with participation in the activities of a terrorist group and a terrorist attack. authorities have charged three others with similar offenses last week. the other 15 people detained on sunday evening were released. the attacks in paris are having a major impact on tourism. initial figures so -- show 10 tickets arehat

down 10% and there are no lines of people waiting to get to the top of the eiffel tower. the french prime minister will be meeting with industry officials to come up with a plan to limit the damage and keep visitors coming to paris. russianroops backed by airstrikes are advancing further into islamic state held territory. the victory today in2 helpsassad' towns troopss. into ice'stest bush stronghold since the russian aerial campaign started two months ago. are planning another offensive to retake another town. tough talktrump appeared to be benefiting him in the polls following the paris terror attacks. he has reclaimed the outright lead in iowa with 30% support according to the latest cbs poll. ben carson who was leading trump in some polls is now in third

place with 19%. in new hampshire, donald trump has a commanding lead with 32% support. the florida senator marco rubio is in second place with 13%. other recent polls have trump surging as well. in these andore other breaking stories 24 hours per day at the new bloomberg.com . brussels whereto belgian prime minister has extended the highest threat level for the capital region. scarlet: this unprecedented lockdown has brought business to a standstill for the past three days. ingsenior economist at belgium has been working from home and joins us now. house?u left the have you been able to get any sense of what activity is on the streets? is anyone at work? >> no, today it was working at home because we had a research

and to stay at home if possible. with new technology, you can work from home. wasrly, in brussels, there nearly nobody. about 70 people were on the street so in brussels, there was nobody. this situation is only in brussels. for the other cities, there are less people on the street but of course the situation in brussels is very extreme today. alix: can you talk about the short and long-term economic implications? >> on the short-term, companies are speaking about millions of certainly for hotels and restaurants and shops. it's very important at the end of the year for shops.

this is the direct impact for other companies when home working is viable but it's less of a loss. there is a short-term loss. tomorrow itthat will be a most the same situation. we hope to start again on wednesday. the metro will work again. schools will be open or partially open on wednesday. this means that there will be at completeull days of stoppage of economic activity in brussels. that is the most important point. what will be the situation in the next week? if you don't go to the shop today, or you have to go in a few days. the loss can be compensated at

least partly. if the situation lasts for several weeks, the situation becomes much more tricky with a negative impact of consumer confidence on consumption and consumption is the pillar of the belgian economy. scarlet: that's a good point, what kind of activity gets pushed to later on this month or early next year versus what kind of activity gets disrupted and cannot happen at all? course, this will be fully dependent of what happens. with christmas and the end of the year, it's a very important time for all the shops in brussels. 50% of theiry make income of the full-year income and these two or three last

weeks of the year. of course, it's very important. other companies can a depth themselves but for hotels, restaurants, or what happens with consumption in brussels, this can have a negative impact. that, itay more than means there is a long-lasting terrorist threat in the country as in other countries in the , we know that a long-lasting trend can have a long impact not only on consumption but also on private investment. moment, it's the short term impact but it's a big question of what will happen in the coming weeks. should we have to live with this --eat or should we adapt

this is the question. scarlet: thank you so much for joining us. for more perspective, let's bring in security policy rafano at theca heritage foundation. he joins us from washington. what do you make about the brussels lockdown when there have not been any terror attacks? can you talk about the policy prescription for that? >> this is the ultimate hobson's choice when it comes to security and public safety. we had an attack in boston but of therds in pursuit bombers, boston decided to do a lockdown and there was controversy. i am always with officials who are on the scene. they have to make these tough calls. i think we have to trust them. discussion you had about the

impact on the economy in brussels, this is not sustainable over time. oftennnot just do this and you cannot do it for a prolonged. p -- a prolongederio of timed. scarlet: people are comparing this to the days after 9/11 in new york. washington, d.c. during the sniper attacks in 2002 is a decent comparison. >> talk to us about that. that was a little different because it was a persistent threat. the city kept operating even as people had a heightened sense of security. that is the only thing, if it's going to go for days and weeks, people have to learn to live with the threat. theexercise caution but pulse of the life of the city has to continue. it's not just the economic activity. look at the pressure on law enforcement. they cannot keep this up

forever. people cannot work 24 hours per day. they have to do other things. the european shopping habits are different. people don't go to costco and stock up for weeks. they are used to going to the market every couple of days. you can do this for a little bit but if there is a persistent threat, you have to go to a different model. scarlet: did belgium back itself into a corner by extending the terror threat day after day? there are so many issues at stake. did they learn something in paris which allowed them to connect the dots which they had not seen before? to roll ofing them some threats that they now know about and it's an over abundance of caution? is it a deterrent value? when you shake things up like this, if someone is planning an attack, they probably rethink this. they will probably go in a different time or do something else. this could buy them some time.

the big problem for belgium and france, they have known this -- they have large extremist communities that are deeply embedded. you have to have -- you have to ask, why did you not go after this before? if you allow this infrastructure to build up, you have to pay the price just pay the piper and that's what's happening in belgium now. alix: thank you very much. scarlet: coming up next 20 attorneythe new york general is investigating possible manipulation and foreign-exchange trading and we will have the details. you pay $20 to get out of airport misery? one startup is using big data to alleviate your travel. scarlet: we'll also take a look at the biggest acquisition and talk about what is next for m&a and health care. ♪

scarlet: welcome back. time for the bloomberg business flash with a look at some of the biggest business stories in the news. shares of alcoa are climbing higher after elliott management bought a 6.4% stake. elliott favors breaking up the company and says it's seeking instructive dialogue with them. scarlet: carl icahn says he may try to make way for the leadership at aig. theirunhappy because

leader rejected his plan to split the business into three companies. not willingceo is to take bold steps. aig says it will accelerate its strategy and provide more details before reporting fourth-quarter results. alix: global mergers and acquisition activity path and annual record today after the pfizer agreement to purchase allergan. there are five weeks left in the year and m&a this year was three point $46 trillion. -- $3.46 trillion. alix: you can always get more business news at bloomberg.com. scarlet: let's check in with julie hyman. kellogg's, it at is being affected by an upgrade over credit squeeze this credit

suisse. it says the stock should reach $76 over the next 12 months and called it the best risk reward in our space. the space is consumer staples. credit suisse says the kashi business focused on more natural healthy foods should return to give the 2016 and business a boost. on the other side, we have go pro and once again the stock is declining, down 4.6%. it was commented on by analyst brad erickson says the quarter is tracking to the low end of the company's forecast. this is in line from what we have heard from other analysts. he checked at stores and said the stores are showing higher inventory on relatively flat volumes over the past several months. how go pro has done since its ipo in june, 2014.

it has had rocky times but lately, the declines of sent the shares below the $24 ipo price and the stock is down 69% this year. we are also looking at panera. maxim.been up dated at the shares are up 3% and it stands to gain market share because of that e. coli issue at chipotle. maybe panera can stand to pick up some of those customers. viacom down credit to a buy at deutsche bank. the stock has performed well notntly and its advertising just sports and live program but it will continue to decline. scarlet: thank you so much. alix: new york attorney general eric schneiderman is looking at manipulation and foreign exchange trading in his investigation looks at brokers in a technique. scarlet: what is foofing?

explain what spoofing is? >> spoofing comes in slight variations. generally speaking, it is when you put orders into the market with the intent to cancel them. if you're going to do that and large numbers using algorithms are doing it manually, it is illegal under dodd frank. if you put orders into the market that you don't intend to execute and you cancel those orders, that is illegal. you can go to jail for it now. sounds hard to figure out improve. how do you do that? >> it's easy to prove now. in the equity futures market which is different from what we in looking at in this and -- this investigation, stunned by algorithm so people program the algorithms to cancel orders in large quantities. is becoming easier to prove this. this investigation is looking at a slightly different part of the market, the fx options and

emergent market currencies which is not a high-volume market like the dollar or yen or pound would be in the options market. this is the interdealer brokers who go between traders for these options and they are putting fake trades and posting fake buys and sells on the market as a way to generate interest and get more activity. it is being looked at from a legal standpoint as a fraudulent practice if it's proven. this is a new investigation and they are looking into it but if it is happening, it could be seen as them trying to artificially create hype around the market that is more quiet. scarlet: are they trying to create liquidity around the market? >> that is the bottom line. typically, they do it in markets in currencies were you don't see a lot of trading on a day-to-day basis. youru're getting

counterparties interested in getting them to call you and getting excited about certain trades on the market, is generating a false sense of demand which can be considered fraud. a broad law that new york has to crack down on white-collar crime. how is this different from the big four and exchange settlements we have seen over the past several years? >> this year, the wall street banks paid over $6 billion for colluding to fix foreign exchange market. that was different because that was on the wall street side and that was traders at banks talking to each other about their client orders and colluding in order to get prices on those orders to benefit their own books. the legal part of that was just the talking and sharing client data back-and-forth. this is the posting of false bids with goes back to spoofing. thatis a form of spoofing schneiderman is looking at

compared to collusion. mentioned the attorney general schneiderman, what does this tell you about his power? >> he is taking on a lot. he took on hsbc. with high-frequency trading. we saw him take that on and take on dark pools and look into that thread that seems to go through these various investigations is unfair market practices. it's getting market manipulation or unfair advantage in certain parts of the market. fx options, high-frequency trading, dark pools, that is the overarching theme of the things he looks at. alix: what kind of price tag can be put on potential investigations like these? >> it's hard to tell the what we know from the last couple of

years of covering settlements is it seems to get bigger every year. we have crossed the $1 billion mark this year and last year with the federal government and now the ag office will settle on lower amounts. it can be anywhere from one dollar to multiple millions. scarlet: the settlements include them not admitting any wrongdoing? , but that can be a component of these investigations. scarlet: thank you so much. she covers financial crimes of bloomberg which means she has been busy the last couple of years. up, a new startup says it can get you flying in no time for just $19. we will tell you how. ♪

alix: welcome back. scarlet: we have all been there before sitting in airports dealing with delayed flights in the hassle of rebooking. it's a million times worse during the holidays. now, a new start of his easing the burden for passengers for $19. it's called free bird and the cofounder and ceo joins us now from boston. what are you doing? empowers travelers to instantly rebook their trips for free on any airline they want when their flights are canceled or significantly delayed are they having missed connection. scarlet: how is this different from travelers insurance that the airline tries to sell you? >> existing travel insurance does not cover travel issues. they cover things like hospitalization, death of a family member, losing your job and things that have nothing to do with your actual trip.

these are things that don't cover weather, maintenance, and other issues that people encounter. free bird flips that model on its head with zero paperwork and we help people get the place they need to. alix: what do you do with the ticket? >> we purchase customers a brand-new ticket. we do so at no additional cost to the customer. free bird charges customers a small fee before they take their trip for access to our rebooking services. when we go through the process, we are purchasing customers the new ticket and it's up to the customer to decide whether they want to seek a refund on the original ticket or whether they want to keep both tickets as a backup or whether they want to grab a bite to eat. whatever they decide to do, they have a way to get to where they need to go. scarlet: how are you gearing up for this upcoming holiday? do you have inventory already? did you already by back up tickets? we have not purchased any flights in advance.

wendy to have a customer's name to purchase that flight. when a disruption occurs, we notify customers with a text message the moment their fight is disrupted. it's up to the customer than to open up our text message and go to our tool and pick a new flight. at that point, we purchase them a new ticket. alix: thank you so much. i will never travel again because i have a one-year-old. scarlet: he will be busy the next couple of days. coming up in the next hour, we'll talk to sylvia matthews burwell, the secretary of the department of health and human services. we will be right back. ♪

>> it is to :00 p.m. in new york. welcome to "bloomberg market." ♪

david: good afternoon. here is what we are watching this hour. combining to create the world .lus's biggest drug company how much you pay for prescriptions. commodities continue to collapse. the bloomberg commodity index traded at its lowest level since 1999. how low can they go? obamacare,season for secretary matthew burwell joins us for an exclusive interview to talk about the program after the world's largest health insurer said it continued to cut ties. let's check with the markets desk for the latest. julie: a little bit of a pause after the biggest rally of the year weekly last week. things have been fluctuating in a tight range for much of th