>> from bloomberg world headquarters, i am scarlet fu. >> and i am alix steel. will prices falling again before recovering slightly. are we closer to a floor? >> america's top -- returns. we will see what he is vying for his third champion. >> and not everyone is enjoying the mild winter. retailers are feeling the heat from the warm temperatures. i love the heat. on today's activity, we want to head to matt miller for the latest. we are grinding our way higher. we are still in the negative column. the reason is apparent

when you look at the oil charts. first off, oil. here you go. we dropped down at 7:00 this morning. 36.85, i am looking to alix steel for confirmation. we jumped up more than $38.50. now we are unchanged. but the markets are still down. if you take a look at brent, that was the headline this morning. it fell below $40 a barrel. the markets have recovered substantially. the dow jones industrial average was down 250 points and now it is -- can we pull up the major indexes? to see where they are trading? no. in any case, the markets have recovered substantially. if we take a look at a longer-term picture, we were

morning, doess the market need oil to rally? i looked at a 30 year chart of the smp versus oil, oil here in yellow and it doesn't necessarily -- there is no correlation. it doesn't need the market to rally. especially over the year, we have seen the smp jump while oil came down. >> today, the energy separate -- is -- it is financials that are having the biggest drag. so it is not a perfect correlation. matt: not even close to perfect. probably less than half. let's take a look at the biotech. they are big movers today. up to the upside, the biotech index is gaining 1.25%.

if you look at the numbers in that index, you see celgene or alexi on putting up strong points. there are big stories of winners today, it is not all about the losers. $36.64 as the low. you were close. were oh, i thought you telling me the correlation between the oil and the s&p 500. >> that would be awesome. >> checking in now, mark crumpton. john kerry says that he has confirmed with the united secretary on the state of global climate change talks. is there to create an agreement by the end of next week.

-- is reviewing the visa program which allowed one of the california shooters into the united states. admittedmalik was one into the country last year to a mary -- to marry an american citizen. it is among the smallest visa categories managed. they typically focus on marriage fraud. oscar pistorius is now free on bail. he will remain on house arrest until appealing his murder conviction for killing his girlfriend, reeva steenkamp. south africa's supreme court overturned the lesser charge of manslaughter. healthns who don't buy insurance would be able to avoid the penalty next year. the deadline is january 31. the penalty has been waived previously but officials say the

rule will now be enforced. define is 325 -- $325 or 2% of the household income. you can get more and other stories on the new bloomberg.com. from the bloomberg first work desk, i am mark crumpton. oil prices are gyrating. there is little change here after tumbling to the low and reaching as high as $38.58. they will keep outlook elevated. >> free for all. that was the outtake. us now with more information is liam denning, from our new fast commentary section. he is joining us here in studio. good to see you. it seems like all of the analysts seemed to be cutting their forecasts over the next couple of years.

what does that tell you? close to a bottom. if you look over the past year, in the second stage of grief or andal, go back one year thanksgiving 2014 -- it surprised everyone i saying that we are going to stand back. even coming into this meeting there was some hope that they would do something and that has gone away. we are in uncharted territory for some people. it is a genuine competitive market in oil. no one is sure what the floor will be. i think it could be going down further. everyone says we need to reach a point of no return. does it depend upon the prince and saudi arabia? sense forakes zero saudi arabia to cut. they need to take back market share. capitulation comes in different

ways. one could be a geopolitical shot economy, i'mhe thinking like venezuela tipping over the edge. it is more likely to come from producers like the exploration and production sector in the united states. they kind of made their way through them this fall but they will talk to spring and it will be harder. we will see more companies scaling back production, even going bankrupt. >> goldman sachs talks about this, the three stages needed to happen. one of them is financial stress. we have seen that stressed lead to production being cut. stress, is operational at which point operation is so low, you have to cut because of your cash costs. do you feel like earnings

estimates for oil companies next year have come down far enough? liam: it is hard to say right now. part of the problem with integrated companies is that they get support from refining the market. in the last quarter, they made more of their money downstream the end they did upstream. i think that will crack going into next year. fourth quarter results are not going to have that sort of tailwind. as we go into the second quarter willxt year, oil prices come down materially, people will start to take down there estimates more. to what extent has the old model of funding collapsed and is no longer relevant? whether it is funding growth or dividends through the equity market because share prices are high and they can continue doing that? or the debt market where things are not as robust as they were? liam: they are closed up for

now. isood example is -- which discussing what to do with the dividend. it has always been a high dividend payer. cracks started to show months ago and that is the signal, along with what is happening in the production sector, that high-yield debt markets are saying, you can't come to us. for some companies, they will be able to do that. can cut itsn dividend and be fine. >> which is why you are seeing the debt rally. that is the charge we have here. you need more money to service your debt. the bondholders might be excited about it. liam: yes, it becomes a tug-of-war between the two groups. when prices go up, equity holders are fine. now they are trying to make sure

that each of them gets looked after. >> what i find fascinating about kindor mr morgan -- story is that it is a templateorgan -- it is doing worse than the actual oil price. why? what is your take away? the oilcause apart from price, they have been about equity markets when they need them. the model was always paying out high dividends and go to the markets. now, not only are people worried about whether they can afford their current dividend, they are worried about whether they can afford to grow. you have to ask yourself, why am i buying the stock? >> thank you so much. liam denning, the energy columnist on our new fast commentary section. , search fast commentary

bloomberg -- on the web. i read liam every day. still to come, the economy may be in a freefall but it is not stopping the trading. we will be hearing from the ceo of ats. -- to be driving gas guzzling suvs? does that make sense? what we will keep it i oil and see how much farther prices could fall from here. ♪

alix: welcome back to "bloomberg markets." i am alix steel. scarlet: i am scarlet fu. alix: job cuts are on the way at

morgan stanley. they will cut workers worldwide and take $150 million severance charges in the first quarter -- in the fourth quarter. scarlet: the identity of the mystery that are of the california chip company is revealed. china resources holdings is offering $21.70 a share. .hat is $1.70 higher fairchild's board is considering it. says they think it was a normal virus that made students sick. they close their restaurants after more than two dozen students became ill. they are already reeling from an outbreak of e. coli. you can get more business news at bloomberg.com. scarlet: matt miller has more information on individual movers. particularly ones in forming

carl icahn. matt: i have the correlation of oil to the s&p 500. the green line is the correlation, coefficient and if it were perfect, it would be up here at one. but it hasn't gone close with the exception of 2012 and 2013. right now they are negatively correlated. wow, i am surprised. that is fascinating. has big stakesn in -- the biggest commodity they make is oil and copper. they don't just make them, that would be making them super rich. carl icon has over 100 million shares. $13 57rage price is

cents. right now they are training for $6.90, down 56% over the time that he has purchased them. he also purchased a stake in should near energy. they are having a tough time of it. andtarted buying in august he is up 2% right now. since august 31, they are down 31%. , carl icahn took a share in pep boys. they are up today because he has started a reading work with bridgestone for the purchase. part of that is the fact that he has bid $15.50 a share to buy the rest of the company. today, pep boys say they like his bid better. is the first company that has liquid natural

gas. thank you for bringing that up. notil's economic woes are stopping america's system from launching a new brazilian stock exchange. america's trading group will be the first competitor to the country. scarlet: joining us now is alan handling. still the big launch of the new entity has been in the works for a couple of years now. it hasn't come into fruition until now. first of all, you have to look at the big pictures. wasfirst brazilian exchange 1817. in financial services, i have to say that the exchanges are the ones that lasted more. so when you do something like

this, it has to be to do something right. and brazil has been a monopolistic market. a lot of things have changed and they are changing. it done, we will get it right. so that is the reason why. we really did the first full innching with regulators january 2014. we expect to get approval within the year of 2016. so quite frankly, it will be a little bit over two years which is not bad. for a country like brazil. like a reallyms tough environment to push forward with this plan. down about 23% since the beginning of may. and the brazilian boy out is down this year. these are really tough economic conditions. we have learned by

watching and trading with brazil. things are never that good and never that bad. alix: that looks pretty bad. [laughter] alan: it is bad. it is time to trade the extreme. we get into a situation that may be a good entry point. investment for the economy. to buy stocks. scarlet: are you calling the bottom? alan: i'm not calling the bottom but i see how things happen. despite the fact with everything that is going on, it the economy is in good shape. they have -- in reserves. reserves of $40 billion. they can phase nine times their external debt and still have change. so the crisis in brazil started thata corruption problem turned into a political problem and now it is affecting the

economy area but the economy is not in that bad of shape. alix: you take a look at the recession, it will contract about 3%? if you try to yield to a investor who wants to invest in the stock exchange, how do you -- when it is down 23% and how do you do that when the economy is in a recession? all, in itself, the exchange might be monopolistic. it is extremely expensive. so by the time you launch an , that his wife -- you will be able to attract others. in terms of whether it is the right time to step in or step out, brazil has been come back. hopefully, the volatility will

go way at some point. we do have the impeachment process right now and a lot of political turmoil that involves economic but we will get away as we always do. scarlet: so this is nothing new to brazil, i get your point. what is your single biggest advantage over the rest of? you ask for a single one, we are really much better than they are. we have a newer technology and we have much less people. scarlet: more efficient? make you mores efficient. at the end of the day, if you company -- so a many years and hasn't changed a lot, not even their technology, we are talking about a speed -- cloud, it is a whole new world.

lot.es change a it goes from the sixth biggest economy to the eighth biggest of the but it is one biggest economies in the world and it deserves an exchange that is what the country is all about. so you didn't call the bottom in the stock market but you were close. what is the single biggest thing that people get wrong about was ill. you say it is in good shape when the numbers disagree. right when they are they look at the abstract numbers. go deeper into that and see the reasons why things go that way and there is a fiscal problem on their, it can easily be turned around is the congress involves some expected measures. scarlet: with the right

leadership in other words? thank you so much for joining us. china'sill ahead, pollution problem -- we look at that picture and we look to the economic impact, next. ♪

scarlet: welcome back to "bloomberg markets," i am scarlet fu. alix: i am alix steel. beijing has issued the first --lection -- first pollution scarlet: you can't see anything. no wonder. if you want to come inside the bloomberg terminal, you can see it. this shows the increase in pollutant concentrations.

last monthcovering and there is the big spike in december. mentioned, the red alert has gone on and there are coal burning that is driving a lot of this but also the increase in cars on the street. alix: if you come inside my terminal, you can see the bizarre correlation as the air quality gets worse, car sales pick up. the gas guzzlers, around a record high now. it is not to tearing putting more cars on the world -- the road. scarlet: we have much more coming up on "bloomberg markets," after this. ♪ sure, tv has evolved over the years.

it's gotten squarer. brighter. bigger. it's gotten thinner. even curvier. but what's next?

for all binge watchers. movie geeks. sports freaks. x1 from xfinity will change the way you experience tv. alix: from bloomberg world headquarters, welcome back to loom bloom."

-- welcome back to "bloomberg markets." six syrian refugees have settled into their new homes. texas officials said they wanted to ban syrian refugees after the paris attacks but federal officials say states are not tohorized to deny safe even refugees displaced by wars. is relieved and eager to start a new life. there are new signs that a shooter in colorado may have to target planned parenthood. --an accused of three people accused of killing three people at a planned parenthood says he asked for directions. paul ryan is joining the group condemning donald trump's ban of muslims to the u.s.

he says it is not what the party or country stands for. donald trump has drawn strong criticism from democrats and republicans, including dick cheney. donald trump is not backing down. the iowa caucuses are -- days away and their arguments over who the presidential front-runner is. donald trump has a 13 point lead. showstest university poll ted cruz leading trump by five --centage points on like cnn voters inarly poll of republican primaries. that is a look at the first word news, you can get a look at these stories at others running for hours a day on bloomberg.com. back to you. scarlet: thank you so much mark crumpton. alix: we continue to keep an eye on oil prices today.

opec voted to keep pumping oil -- but whony kind of is selling? why would you sell at $38 a barrel? two illustrates that come inside to i that come inside the bloomberg terminal. llust -- is people betting on a lower oil pricerate and the yellow line is the wti price. this is unbelievable, much bigger than 2008-2009. scarlet: you wonder when you will see a short squeeze in oil prices. why has oil become a popular short trade in the way the euro was a short trade? to put the oil price

weakness in perspective. come inside the bloomberg terminal. we are in the fifth month of averaging below $50 a barrel. in august, right here, we started above $50 but we lost our way. -- then it crept up to $45 and some change and then it crept ofher to $46 in the month october. in november, we went back to $32 $39.56 is the average. alix: -- just put out a note saying they need to close above in order to argue that it was a reversal day. so that the downside is over. day? dollars in one it will be hard to get above that. i want to point out the damage that has been done. brent forward curve, the orange line is the current curve and

the green line is what it was six months ago. there has been significant damage done over the last six months in terms of oil price expectations. scarlet: and you wonder when that capitulation is going to come. what is it going to look like? alix: the markets are so negative and so short, we saw this in august. scarlet: we have much more oning up on loom bloom -- "bloomberg markets." returning to the big apple for the 1920's. alix: and you may be loving the warm weather but retailers are not. chinese imports the drop off 9% after falling for a straight month. you do already see the impact in commodities. ♪

scarlet: this is "bloomberg markets," i am scarlet fu. -- two american cup championships and going for a third. let's go to cory johnson. with -- whoined now i have not seen since he crossed the finish line in the thrilling victory. as fun as it ever gets with team oracle. jimmy, we are glad to have you. tell me about mounting the defense for the america's cup? >> thank you for having me.

it is great to be back in new york. the next america's cup will be junermuda in the summer of 2017. which is not in america. [laughter] >> but it is very close. it is paradise. having just experienced traffic here, i think all of you deserve a break. it is a great racetrack. it will be incredible. regattato us about the that is going to happen in the hudson river? yes, that is why all of the skippers are in town. we are very excited. it will be held in the hudson, in front of the world trade center and the statue of liberty. these boats are in -- are incredible. 50-60 miles per

hour. they literally fly, powered by -- >> these are the same both as last time? >> a little bit smaller. it is all the same design. we can fit in the small areas. >> what do you think about how technology has changed the race with sailing, as you will, in terms of the sport. it has certainly made it faster and more interesting. >> it has changed it. it has taken a quantum leap in terms of where we have been. -- especially the mainstream sports, our engineering and construction is up there with the latest technology but frankly, i were boats have not been the f1 on the water. the case.is not

we have the fastest boats in the world. we have the best athlete and there is a lot of risk involved and the race is 20-20 five minutes long. in the past, you could look away and not miss anything. >> in the san francisco bay, it was a wonderful -- i wonder, there was criticism over the last america's cup that the boats were too expensive as it kept a thick field of competitors out there. what are the boats going to be this time? have they addressed those concerns? >> it is a great point. -- spectacle, we have hit that market. non-sailors can turn in and watch this. this time.ig push there is one designed to all of the components that -- it doesn't matter to the performance of the boat. the tiny little gains that you -- so you have agreed to have

the same components of the boat? >> exactly. have left open a few things that are really cool, for instance, the hydra cools. >> at a certain speed, basically when you are going -- or above, you can get the boat out of the water? >> we only need about 10 miles per hour of wind. 2-3 times thedo wind speed. that is incredible in it self. the boats are the stars of the show when you watch it. but now the athletes -- in the past, we didn't have a boat full of athletes. now it has separated the field. there is no hiding now on a boat. so where do we go in terms of technology when it comes to sailing? >i am a traditionalist.

but i appreciate how fast and how great these devices that are full of technology are. where do you go next? >> that is what is exciting. who knows? >> how much better can they get? >> we all wonder that. each day, we wonder where we will go. for us, that is what is exciting. we are finally on the forefront of technology and are leading the way as opposed to following the other sports. that is great for us. people who think have been non-sailors have struggled to watch the show but now, clearly you don't have to be a sailor. you can keep listening to this conversation on bloomberg radio. alix: let's get to the global business report. ♪ scarlet: you are watching

bloomberg, i am scarlet fu. here is what we are watching. olivia blanche art is taking a stand on when the federal reserve should raise rates. slumps as the second-largest economy struggles. scarlet: a mining giant is scaling back in a big way. because of a commodity crisis. with start with comments olivier blanchard a. he warned that they need to take action now. you have to start before it is too late. that is the difficulty of it. even when we have increased the rate by 25 basis points, we are still very far from the rate with which we should end up. for these reasons, this is the time to do it. china's trade its club

keeps getting worse. it fell in november for the fifth month in a row. the trade data comes after a report shows that china's factory conditions fell to the weakest level. worsens, johnmp brown spoke to bloomberg in london about where he thinks oil is going in the long run. nothing is impossible. i think long run -- $20 in today's context is probably wrong. but that is as far as i would go. alix: anglo american is scrapping the dividends for the first time since 2009. they will suspend evidence for the second half of this year and all of 2016. they're pledging deeper spending cuts to help them withstand a collapse in commodities. time now for the bloomberg quick takes where we provide background on issues of interest.

today, breaking down abenomics. -- expanding rather than contracting. but still, record high profits and rising stock prices. japan's economy has been stuck in neutral for 20 years. china overtook japan as the largest economy. took office, he had a plan. abenomics is a departure. uncompromisedd of monitoring easing and deregulation. the next phase will help boost to the safety net at a time when the country's population is aging and shrinking. japan's real estate and stock market bubble burst in the early 1990's and then it stagnated. to two long decades with no economic growth and inflation that -- confidence.

then came the earthquake, synonymy and nuclear breakdown. abe returned to office in 2012. -- government debt is the only way to continue. the point to the fact that this tragedy has worked in other countries, including the u.s. the nikkei index doubled since he took office. -- says that japan is still avoiding the economics needed. such as taking on farmers and utilities. they are looking for him to take more tough steps in 2016. thank you so much. this has been your business report. for more stories go to bloomberg.com. let's go now to abigail doolittle live from the nasdaq. abigail: thanks so much.

qualcomm shares are getting hit once again. it has been a tough year for the chipmaker. is part of the news that south korea accused the company of file eating local trade flaws. now we have the european union tactics mayqualcomm have unfairly crushed rivals. a trend could be rising. shareholders may want to wonder how they will address this situation and will it affect the numbers? at this point, investors are not so happy. this is the biggest yearly decline since 2001. tesla shares are down today. there has been a lot of noise around this stock between recalls and upcoming competition from porsche. bernstein is out saying tesla could struggle on the manufacturing scale. these are good long-term

concerns but more relevant to stock today is whether they can hit the 2015 production targets. returned to cash flow positive status in 2016? many investors think not that betting against elon musk has so far not been a winning investment strategy. the stock is up almost 850% since the ipo in 2010. scarlet: thank you so much. abigail doolittle reporting live from the nasdaq. we have much more coming up from "bloomberg markets." alix: they always complain about the weather. if it is too cold, you don't leave your house but if it is too warm, you don't buy stuff. why the warm weather is putting retailers in a sour holiday mood. ♪

lulu --ill go back to ick to "bloomberg markets," am alix steel. i was cold this morning. scarlet: retailers who sell cold gear prefer to see frost on the ground. inocencio is outside with detail is on the retailers weather woes.

what is the vibe out there? i see a big sale sign. >> yes, that is right. they put out this sale sign in the past few hours. sales of 25% off or more. we could see even bigger discounts if this warm weather does continue today. we are pushing about 50 degrees. it turns out that the actual average temperature is only 43 degrees. so we are several degrees higher. that doesn't bode well for columbia. ever since august 1, the share prices have tumbled by 37% and that is because of the warmer winter weather. people aren't buying the hoodies or jackets or sweaters. earlier i spoke with planet alytics. they have interesting numbers, based on year over year from

this november at last november. boot sales are down by 7% and the winter weather accessories from loves and hats, they are down 10%. share prices have tumbled and bank of america merrill lynch has downgraded the stock from a buy to a neutral. right now it is around 45 degrees -- $45 mark. excuse me. several only rising by dollars. 45 degrees is what columbia wants to see. [laughter] there are some retailers who benefit from the warmer than average weather. tell us about home depot. depot is a standout because of the warmer weather. november through this month, share prices have risen. 14%.s risen by about

it is logical. if it is warmer weather, people will do stuff outside, including do-it-yourself home repair. people are going to the stores and they are going to their roofs and lawns. doing things to improve their home. that is one bump that home depot is getting out of that. fromally across the sector data, it turns out that the diy centers are seeing a bump year over this november to last november, more than $100 million in revenue compared to specialty merchants and mass merchants which are losing about $150 million up to $200 million. you can see the up and down. the national retail federation predicted it would be a banner year. what would we have to see for that to be the case? ramy: they have a prediction out

, that they expected for this billion.eason, $630.5 thanis $22 billion more 2014. so it isn't that the warm weather is stopping people from buying but it is shifting their dollars to something else. and in this case, they are saying that money is probably going into technology and automobiles because we are seeing lower gas. also, experiential things. scarlet: thank you so much. on idea of spending money things like seeing a broadway show for christmas inside of a ski jacket. sale signtheless, the is something we will see more of because we have a lot of inventory. come inside the bloomberg terminal. i am looking at the inventory to

sales ratio in apparel. you can see how high it is. so much intock up the first half of the year, expecting demand. the demand didn't materialize and they are left with extra stuff. they have to offload it. scarlet: it is part of the bizarre way that retailers manage their timetable and inventory. you sell the winter gear in august and september and then you sell the spring gear in january or february. alix: when do the bikinis come out? is douglas yearly from toll brothers. whether he has seen growth in city living. ♪

1:00 p.m. in new york, 6:00 p.m. in london, 2:00 a.m. in hong kong. scarlet: welcome to "bloomberg markets."

scarlet: from bloomberg world headquarters in york, good afternoon. i am scarlet fu. alix: i'm alix steel. a big dent in middle today. commodities getting crushed as china continues to pull back on imports of all material. scarlet: cold comfort for investors. oil prices rebound ever so slightly, stocks still in the red. dwyane1-time all-star wade isn't just known for his skills on the basketball court. he is also becoming a big shot in business. look at that shot! oh, stephanie ruhle for the win. scarlet: let's go to the markets. matt miller has the latest. that?u do a swish like matt: no, absolutely not. i failed out of basketball as a kid. let's look at markets, my strong suit. we're not looking at the

250-point decline we saw earlier. that is mainly because oil has come back a bit. look at the dow intraday. the chart pretty well traces the decline and rebound of crude oil, as you will see. if we pull up the crude oil chart than we have that loaded up as well. tode goes green and manages stay there, it has been a rough couple of days. we were at $40 in change on friday. friday, huge laundry yesterday, huge moment, and this morning, just a drop. bit of a recovery today. scarlet: we often hear people say that the routing oil -- you have long-term charts that suggest otherwise. matt: i shared with you guys the correlation. it is not strong. right now it is a negative correlation. you can see here is the s&p in yellow, oil here in orange. real divergence in october. that is why you have a negative

correlation of .17%. versus the energy sector, i should say, a real divergence there. that is going back to the middle of 2015. energy index breaking way from the major index. quickly want to touch on the biotech index. you see a little bit of recovery in the nasdaq. 1.5%, one of the biggest gainers in the session today, as far as industry groups are concerned. alix: thank you so much, matt miller. scarlet: let's check on first word news. markup and has that from the new stuff. -- mark crumpton has that from the news desk. mark: secretary of state john kerry's in paris were officials, including you and secretary-general ban ki-moon, are trying to reach an agreement

to fight global warming. erry: the k secretary-general and i talked about negotiations and the steps we need in the next few days to be successful. he has been working diligently with the delegation and we appreciate his leadership. also secretary kerry criticize those who doubt climate change is your, saying the refusal to recognize it is in his words, insane and insulting to everything we learned in high school about science. vice president biden told ukraine's parliament today that the united states has the country's back in the border battle with russia. the vice president said the u.s. will never accept russia's takeover of crimea, but he warned lawmakers to keep their own house in order. pro-russian president's letter last year during anticorruption protests. after 40 suggest money, the prosecution has rested its case against one of the baltimore

, maryland police officers charged in the death of freddy gray. prosecutors say william porter failed to call for a minute despite gray's plea that he needed help. death ignited of riots and looting in the city. porter is the first of six officers to stand trial. oregon residents are used herein, but not this much could the streets of portland resemble creeks after the wettest day of weather. 2.7 inches of rain fell yesterday good forecasters say it won't stop until the end of the week. you can get more on these and her breaking stories when hours today at the new bloomberg.com. i am mark crumpton. alix, scarlet, back to you. scarlet: investors are adjusting to the weak economic data out of china as well as the gyrations in oil prices. joining us is tina davis, who specializes in energy and commodities.

what really confused me today as we get the week import and i for #china, and everyone freaked out -- oh, my god, they are not buying commodities, but that is kind of a lie. goodwere actually fairly year on year growth. did we totally misinterpret what we saw in terms of the import data? tina: a lot of the things that are driving the equity side is fear of what happened with the anglo american and that spreading in terms of other companies that need to cut dividends to make huge job cuts and really rethink the strategies, given the route we have seen in metals throughout the year. china obviously is a big part of whatever happens in the metals market, whenever they show any sign that a man is not going to grow in double digits from that is a concern. alix: but he doesn't seem like that is slowing at all. it seems like you have iron imports and 80 million tons, big growth in terms of oil demand.

the demand story in terms of china is actually much stronger than the underlying metal price would suggest could what do you think about that? operating still in neglect. we have a lot of producers unable to get back to me as the market might want them to because shutting a mind is a con vacated endeavor -- complicated endeavor. we have seen the ceo at half of the output now is it profitable. they are selling at a loss of half of what they are producing. for the industrial metals, it is a case of boom-bust, where 10 years ago when prices were very you saw a lotgh, of of reaction to that and now trying to sort of taper the supply in terms of demand growth that is not as strong as everyone thought. scarlet: it is a supply story and less of a demand story. is a supply story, what is the catalyst?

aat is the one thinking for -- one thing people are looking for? tina: we have seen china itself say they will cut the output of aluminum by 5%. there is acknowledgment even there that there is a little too much -- and he started to see some of that -- eventually being withdrawn. we have a story of how it may take more mining bankruptcies at this point. alix: what is interesting about the data out of china is that the oil profit at rose to over one million barrels a day. what that seems to me is they are buying a lot of stuff and raw materials but they are making it into fedex the product. -- making it into product. sign that is another the demand is maybe not as healthy as we want it to be because we are seeing a lot of

the teapot refineries, smaller refineries, to get commissions to export in ways that the government has not been allowing for. all the distortions in the market added to the excess supply. the first time you talked about it. thank you so much. scarlet: coming up in the next hour of "bloomberg markets," toll brothers mcwhirter profit missing expectations.we will look at the numbers. president obama and hillary clinton class on tech companies to help in the fight against terror. scarlet: canada not happy with u.s. beef industry.

alix: welcome back to "bloomberg markets." i am alix steel. scarlet: i'm scarlet fu. time to look at the biggest business stories right now. job cuts underway at morgan stanley. they will take a $150 million severance charge in the fourth quarter. there are paring back the fixed-income trading business. alix: canadian pacific has made a revised takeover to norfolk southern and the u.s. real war has turned it down -- u.s. railroad has turned it down. norfolk southern says the new offers less than the $20 billion bid -- 20 $8 billion bid the railroad has rejected. suspendedn boston, the operating permit of such a fully -- chipotle near boston college. chipotle is reeling from an e. coli outbreak that made dozens

six. you can get more of that strain on the business news at bloomberg.com. alix: matt miller has a check on the company movers. you have got to start with chip otle. matt: i almost went there for lunch. of my personal feeling on the companies they make delicious burritos. but you have to be careful right now, or at least if you take into account on the news that is come out good boston college says 80 of its students are sick , or atting chipotle least all 88 at chipotle, and they are all sick with some sort of gastrointestinal issue. chipotle said the last known case of e. coli that was linked to its food was november 7. that was a long time ago. they still don't know which ingredient caused it, and there is no news from chipotle about what is going on at boston college. you have to be careful if you are concerned with that sort of thing. down 3% but it got

so the question a slew of analyst downgrades over the weekend. to me take you forward children's place, as it is called. now,lly gaining 12% right even witnessed third-quarter earnings estimates and it missed sales comps for the third quarter. it has to be the outlook. the caprices fourth-quarter sales in low single digits and dollar threene cents in the third quarter. the estimate was $.99. toll brothers said that profits are up in housing prices climbed but that stock is down again. it is a -- it is an issue of the outlook and eight by on the buyr, sell on the trade -- on the river and so on the tray.

alix: and we will have yearley douglas yearley -- douglas yearley on in a few moments. matt: i look forward to that. scarlet: we are joined with the managing director of blackrock america fixed income group. amer, we need to ask you to put the data in perspective. last week u.s. manufacturing numbers showing that we are at a three-year low. inflation data tonight is likely to confirm the weakness. qualify for us this persistent weakness of china. amer: listen, the data this morning confirmed to us what we have known for a while. this is stabilizing at fairly mediocre levels of growth. thee are serious risks of economy falling off a cliff, the kinds of risks we thought were occurring in august don't seem to be there anymore. at the same time, as evidenced by the weaker earnings in exports and make manufacturing and the sluggish investment

spending, it is selling us this is not an economy that is creating much dynamic to a global economy. it is not a danger but at the same time it is not excitement we were looking forward to in china. alix: how the other asian nations opposed to export and import to china factored in this new normally -- this new normal yet> amer: almost certainly. you are seeing it in terms of sluggish growth out of koreas and taiwans and indonesia's of the world. at some point in september or october, we thought there were some green shoots. we thought there were experts on , and, u.s., europe unfortunately, the data in october has confirmed that even their, the impulse out of the rest of the asian countries is

not very dynamic. --re back in the new normal not exciting, but at the same time, not dangerous. scarlet: what impact do you see from china's stimulus? do you see it showing up in the data anywhere? amer: of course. the steam assisted instrumental in making sure that those sectors remained buoyant, not collapsing, and more importantly, ensuring that sectors are recovering and growing. you think of china today as 2 economies. you have domestic consumption and government spending doing quite well, probably much buttressed -- very much buttressed by monetary policy. at the same time, another economy in china, and the summits in, the housing economy is reeling from excess capacity and the excess weight of leverage as well.

stimulus is a way in which you ensure that the first group continues recovering what the second group doesn't fall off a cliff. it seems to me that they've been able to thread the needle and maintain that level of stability. seems the other part of the needle has to be the u.n., now that it is included into the imf special drawing rights basket. pboc cut the reference rate by .1%, very different from the 1.8% cut we saw in august. how much more depreciation do you expect more volatility, for that matter? amer: my best reading of the situation as they have attempted the anchoring effects policy. at some point in mid-august they lost the anchor. that created massive amounts of capital flows and importantly, stop them from being able to engage in monetary policy. they wereuidity

creating was going through the buying of dollars and capital outflows. at this point they seem to have regained the momentum by stabilizing the currency and not allowing it to weaken the way they did in august. this is the playbook for the next few months. the exchange rate stability, maybe volatility on the margin, but no longer the kind of weakness we saw in august. alix: such a pleasure to have you, amer bisat. scarlet: still ahead, purchases of new homes jumping on 11% in october. we will be speaking with douglas yearley next.

scarlet: welcome back to "bloomberg markets." i am scarlet fu. alix: i'm alix steel.

toll brothers announced earnings today, announcing it will build 1800 homes this quarter at the average price of $790,000. scarlet: carol massar and cory johnson a bloomberg radio join us with more. ol: thank you so much. we welcome everybody on bloomberg tv. i'm carol massar, along with my cohost, cory johnson. toll brothers are out with the latest quarterly results today. keep in mind that the overall broader market is also down. joining us right now is doug yearley, the chief executive officer of full brothers. time will give you a little bit of a promotion there. he joins us from -- i almost did you a little bit of a promotion there could he joins us from company headquarters. talk to us about the quarter. carol.hanks, great to be on with you again. we had a really great quarter. frustrated by the stock move

today, but we can't worry about the day today moves like this. our orders are up, our first five weeks of the new quarter, which started november 1, new contracts are up 21%. exceeded margin in 15 the gross margin of 2014, and we have guided to an even better gross margin in 2016. we have reposition the company with a lot more action out in california now get city living in new york is still doing really well. i'm really proud of the year end product the quarter and i'm very positive about where we are headed. talk to me about expansion in terms of geography and how many places you are going. doug: right now we are in about 20 states, 50 markets. we cover all the luxury markets f the u.s. there are no new markets we are

no new markets we're focused on entering this year. we want to get bigger and better where we are. i mentioned california is about 20, 20 5% of our company. we are thrilled with what is going on in northern and .outhern cal we are also in seattle, phoenix, dallas, houston, denver, midwest , the big markets there, and then of course we dominate the c-boston corridor, which is our home, and a north carolina and florida. i'm thrilled with the footprint. looking to do markets here and there, but no great strategy for 2016 to enter new geography. it is just a get bigger and better where we already are. carol: what about acquisitions? the chapelle homes acquisition was a big deal for you guys. do you feel like there is additional acquisitions to be made along those lines? doug: there was once in a career type deal, carol. carol: huge, yeah. doug: finest land in california.

that is what is made has big us -- as big as we are in california. we are looking for land committees who may have a portfolio of land. we are not going to find 5000 lots in coastal california, which is what they represented. again, there are not committees out there that have that type of portfolio. the m&a market is pretty heated right now with small builders. there have not been to many except foractions the riley pacific merger this past year. we are always looking and we have acquired a builders in our history -- eight builders in our history and i'm sure there will be more in the future. i know the california market is important to you and important to me because it is my home as well. on the conference call, kind of a surprise, love talk about the slowdown in asian buyers buying in california. it seems like to have had a pickup and a sizable one. doug: yes, very interesting.

the fourth quarter, when percent of the 20% of the northern, 40 buyers were foreign nationals come up from 13% in the first three quarters of the year. in southern california, running at about 20%. 15-20% for a year. slight increase in the south and a more significant increase in northern california. part of that might be the price point. we are building homes in special locations and good market or bad, internationally, we still tend to attract lots of international buyers. carol: we are all anticipating that the fed will start raising rates next week. what is the trickiest part of the housing market? be quick if you click. -- if you could. doug: the trickiest part for us is labor. we went through the worst housing depression ever in 2007

to 2011. so many workers left construction. it has been slow to get them back because of all the big builders who have ramped up production. there have to labor shortages around the country and we are managing it come it is getting better. carol: great to check in with you. thank you. doug yearley, chief executive of toll brothers, joining us from the headquarters in pennsylvania. i will pass it back to you guys. scarlet: thank you, carol massar and cory johnson of bloomberg radio. toll brothers down 7% in intraday trading, the biggest drop since august. alix: much more ahead on ."loomberg markets ar political leaders urging companies to conduct terrorism.

from bloomberg world headquarters in new york, welcome back to "bloomberg

markets." i am alix steel. scarlet: i'm scarlet fu. mark crumpton is that our news desk. the federal government is looking at the visa program that allowed one of the san bernadino shooters in the united states. testing the leak was one of the mal was one of the pakistanis allowed into the country last yearik. officials typically focus on marriage front. 6 syrian refugees have settled into their dallas homes. comes after arrival taxes officials said they wanted to ban new syrian refugees following the paris dexcom of the federal officials say that states are not authorized to deny safe haven to families displaced by war. sayrnational rescue groups the family is religion eager to start a new life.

speaker paul ryan says the house will pass a short-term bill to prevent the government from shutting down this weekend. the investment came as talks on the government-point spending bill continues. the government is operating under a short-term spending measure that expires midnight on friday. americans who don't buy health insurance won't be able to avoid the penalty next year. the obamacare deadline for getting coverage is january 31. the penalty has been waived previously but federal officials say the role now be enforced. the finest $225,000 to the other $25 or 2% of households in -- $325 or 2% of household income. you can get more on these or other breaking stories 24 hours a day at bloomberg.com. i am a mark crumpton. back to you. oval president obama's office speech on terrorism included a plea to silicon valley to make it harder for terrorists to skip from justice. scarlet: we heard from hillary

clinton, presidential hopeful, urging leaders to get to work on innovations. alix: carol we did not hear detn how this could actually be accomplished. reedet: with us is stevenson from san francisco. they have not made clear the details. one of the hinting at? -- what are they hinting at? >> what they are hoping for his access to encryption technologies, ways to sleep in on conversations and find out what people are planning and what they might be working on. but it is easy to ask this but much harder to get it into an actual practice. scarlet: is it feasible? reed: it is certainly feasible. it would involve creating backdoors that the government can use to access conversations. but not practical

because it adds another layer of complexity. it attracts -- to tracks from the security of these technologies. you have for member a lot of encouraging technologies are made so that the companies implementing them can access communications. alix: i'm assuming tech companies are saying, guys, we can't do this, or we don't want to do this. a, is that accurate? b, what does the government have to do to foster cooperation? reed: this is under the envelope of addressing the symptom rather than the problem. on thes of keeping a lid speech that incites hatred and whips up a frenzy -- for example, youtube removed 14 million incendiary videos last year from the services because they were deemed to be offensive or aiding terrorist acts, etc. scarlet: is there only so much silicon valley can do?

there have got to be other applications that are beyond the purview of silicon valley. reed: there are technologies such as machine learning and deep thinking data where you look for patterns and trends and things that are already available to figure out what is happening, what is going on. example, -- it is in those areas that they will be able to work with silicon valley and work with the government. there are so many moving parts and it is no slamdunk. aboutwhen he talked encryption, they don't want to give data over, and apple and facebook cannot even access themselves -- are we going to see changes in this kind of thing? reed: i really don't think so.

the tech companies are resisting this and it is not going to fix the problem. it is going to potentially make it worse because encryption can be broken by other entities as well. if you think about it, encryption is not that hard to implement. even if you created a backdoor into these secure communications , people can go and create their own encryption, encrypted conversations or technologies. it is like playing whack a mole. scarlet: especially with the twitter handles like the cropping up constantly. has worked on the 350th iteration of its twitter handle. reed stevenson, thank you for joining us today. alix: coming up in the next 20 minutes of "bloomberg markets," canada is in a battle with the u.s. over meat labeling

practices. how much impact will this have on these imports? scarlet: lebron james signed a contract with nike but dwyane wade jumped his contract last year. there is steph. alix: we missed it. she makes the shot. one of the world's biggest mining companies taking drastic measures. what has the company ded

scarlet: welcome back to "bloomberg markets." i am scarlet fu. alix: i'm alix steel. the identity of industry bidder -- the mystery bidder for california chipmaker is revealed. it is offering $21.70 a share. that is $1.70 higher than last month by the semiconductor. united airlines is offering a guaranteed to its biggest corporate customers, promising to be as reliable as american and delta next year,

discount, united will offer credits for fees. united says it has moved from the bottom of the industry to the top, not yet number one. alix: consumer groups is that advertising campaign is deceptive. t-mobile promises to give up service contracts and and hidden fees. the t-mobile chief says that the company stands by the end. -- ads. you can always get more business news at bloomberg.com. scarlet: let's get to the markets desk where matt miller has the latest. we have to focus on oil. alix: the price action was stunning, for sure. the volatility has been nuts today. this after a real decline on monday and on friday after opec

failed to really put any kind of production now that they have had one for the last couple years. to $36 64 ame down barrel. jumped back up. $37.61, whereat we close yesterday. look at gasoline. the derivatives scarlet was referring to, and similar moves here. we saw other things like natural gas, although it stated negative. .asoline up half a percent important to think about what happens when the crude goes down or up and the effect it has on other companies. usually airlines are the big beneficiaries of crude drops. we have seen this precipitous fall over the past couple of days in crude. airlines have been big gainers the past couple days. they are taking a hit on the chin big-time. delta is down 3.75%.

jet -- jetblue up 2.5%. bounces back up, that is negative for them. they have had such a big games buy on the river and sell on the news kind of thing. it should be mentioned that most of the airlines also hedge. the crude prices don't affect them as severely as the market thinks. norfolk southern, a great story that we are all following. the ceo has been pursuing a takeover. the first takeover attempt last week, they did against -- when he came back with a sweetened deal, and now bill ackman has gone into the fray, ladies, and he has said that hunter harrison is the greatest railroader of all-time and he doesn't believe norfolk southern can improve its efficiency as well as canadian pacific. alix: part of that, of course,

related back to energy as well. the demise of goal, how much energy is transferred by rail and how much demand there is and if there's any kind of supply issue that will impact it as well. transporting my train can be quite expensive. if they rise, you can eat into business. take my bloomberg terminal right now, i can show you how much revenue the company gets from coal. here you see norfolk southern, the orange is revenue from all things but the blue is from coal. you can see it climbed up in 2011 and is coming back off. the same is true from the intermodal revenue. , such ae real problems big chunk of the revenue falls, and you see it on all railroads across the nation. alix: that is a structural

change. that will not bounce back when the oil price goes to 50. this is a structural shift in the economy. scarlet: lower for longer and the different railroads have to adjust. consolidation might be one option. matt: that is what hunter thinks. scarlet: this one out there. -- best one out there. matt: according to bill ackman. what a great title. i would like to be the greatest railroader of all-time. alix: greatest cargo. --car guy. matt: such a manly title, although the woman could be the greatest railroader. scarlet: canada has got beef with the u.s. beef industry. the countries that to impose retaliatory taxes against beef imports on a trade battle on meat labeling rules. alix: this comes after the organization ruled against canada and mexico. we are joined by pamela ritchie,

bloomberg tv canada anchor come in toronto. what were these issues to begin with? pamela: back earlier this year, alix, canada as well as mexico applied to the wto, the dispute we are not happy about the fact that everything that comes from canada, beef and pork, is labeled with country of origin labels. it essentially means it is not made in america, which is true and there is nothing wrong with that. but it puts producers at a disadvantage, going to the wto.. grocery distribution companies, just don't buy canadian meat because it doesn't sell with these labels on it. thathe wto has rolled is canada is allowed to retaliate in the amount that it feels it has lost under these labeling because of these labels.

canada is allowed to retaliate by $781 million, and mexico by the amount of $228 million. the wto did say that what canada and mexico claimed they lost is a bit more in the dvinci out didn't think they deserved quite that much -- and the wto didn't think they deserved quite that much. but the government needs to decide if they want to abolish this form of labeling. scarlet: what is the idea behind the labeling to begin with? well, you can understand how consumers all around the world want to know where the food is coming from, and that makes perfect sense, and more and more come i would say, in many western countries, this is something that is absolutely demanded commended grocers and the people at the point-of-sale want to make sure they can offer all information to their customers. from a trade perspective, though, we see that losing

access to markets in canada and mexico -- this is u.s. beef producers would have trouble exporting to canada and mexico in the amount that they say they are retaliating. from the trade perspective, then, it would cost american beef producers $.10 a pound immediately, according to the u.s.-based national cattlemen association. if from the retaliation sign of things went through, it is quite critical for the beef association there. if the senate doesn't reveal these labeling rules, u.s. beef exports face a 100% tariff in these countries. u.s.ately, canada and the largesta is the u.s.'s trading partner -- you would see how they would want to find an agreement on this. this is the trade dispute they are in the midst of. alix: in terms of the prices come that is what i did because i love commodities. . any sense of what it would do to

be prices there -- beef prices there? pamela: well, because beef prices are up, we have the dollar to take into consideration your good it is harder and harder for canadians to make sure to import more expensive reef. there is that side of it as well. this is the high level, association levels. alix: thank you, pamela ritchie, bloomberg tv canada anchor. scarlet: coming up, nba star dwyane wade goes one-on-one with our own stephanie ruhle. hear what he learned at harvard business school and what he plans to do when he retires. ♪

scarlet: welcome to "bloomberg markets." i am scarlet fu. alix: i'm alix steel. scarlet: nike hasigned lebron

james to an unprecedented lifetime contract. michael jordan's former agents as it could be worth half $1 billion, and it could be similar to michael jordan's nike deal. sales of air jordan shoes top $2.2 billion last year. alix: nba all-star dwyane wade of the miami heat once had eight but ditchedth nike it to form a partnership with the chinese copy. in an interview with stephanie ruhle, wade explains it was more important than money. nike, congress when i was with congress, and then i went to jordan. i was at a point in my life when i was turning 30 and i was like, you know what my want to do something that leaves a legacy. how can i build my own legacy for my kids? for me, it was like, you know what -- stephanie: kevin durant's shoe deal come that is a lot of money. dwyane: that is a lot of money. i wasn't getting that money

could that is a different kind of legacy. how do i start to build his legacy? for me it was more looking at the bigger picture -- it wasn't about the shoe deal, wasn't about the actual contract. it is about what i can build and howbrand globally, to open up doors and windows for me. scarlet: stephanie ruhle joins us on set. stephanie: or is alix steel likes to call me, "you guys." alix: you guys do this now. about hisade thinks first nba career and he has made steps to do that during his career. stephanie: we see that more and more. these are the days of when the athlete retires maybe he will buy a stake in auto dealership it kobe bryant, who announced week, he hast last been a major investor for years. a $375 millions shoe deal.

dwyane wade partnered with the chinese company because he has got shoes, bowties, wine. they are all looking for the next chapter and many point to a guy like magic johnson, the only athlete who actually has an ownership stake. take a listen to what we heard from kobe bryant. dwyane: kobe, as he said it has conference, is a triple og. we are the old guys. we are the next ones up after andkobes and tim duncans dirks retire. it is scary from that standpoint but from a guy who is a role model to me, somebody i can call a friend, his career was amazing. -- the real question, though, is what is these guys know about business? stephanie: this is the sad truth about sports, athlete after athlete hired the wrong guys and invest and ideals and go".

remember, the heat didn't have lebron last year. what did dwyane wade do? take a look. dwyane: i wanted to be educated in the field i want to go in so to go and talk about business and marketing and all these things come it was great for me to go in and be in a room full of people from different walks of life, different companies that have the same month money, or more, then i have come and to pick your brains and get the pspective has the talent but also to hear from another site, too, as octomom how they think as well,ity, how it -- on how they think about equity, marketing, all these different things. i wanted just to me like my brain on the other people think. stephanie: didn't go to disney world at the end of the season. harvard business school. scarlet: i love that he did that over the summer. i'm thinking of sean avery who had an internship at "vogue"

magazine between seasons. stephanie: the amount of athletes that have gotten injured -- listen, if they make tons of money, they live big lives. to have an actual business plan when you look at what guys like michael jordan -- michael jordan -- we have seen the 30th edition of air jordan shoes. he continues to make money off the brand. yesterday night the announcing that lebron -- nike announcing that lebron will be a lifetime athlete with them. these guys have marketability long after their careers. alix: how does nike make a long-term commitment? say is it that makes nike want to hook up with you for the next -- stephanie: clearly they saw lebron james in "trainwreck" because he was amazing. if you are nike, it is cheaper because you know they will get into a bidding war and it is cheaper for companies like adidas and under armour the next few years.

nike has competition. if you lock a guy like lebron in, lebron will be hot forever. scarlet: and prevents other people from locking him in later on. an athlete like lebron has proven he will be prime time foreva. alix: did you make that shot? stephanie: i like to point out that last year i raced usain bolt and he may be faster than me but right here, right here, you wonder if she will make it in a cocktail dress. alix: that was really impressive. he is one arming it. stephanie: laser was to try. -- blazer was too tight. alix: coming up, pennsylvania senator bob casey. sure, tv has evolved over the years.

it's gotten squarer. brighter. bigger. it's gotten thinner. even curvier. but what's next?

for all binge watchers. movie geeks. sports freaks. x1 from xfinity will change the way you experience tv. tand that's what we're doings to chat xfinity.rself, we are challenging ourselves to improve every aspect of your experience. and this includes our commitment to being on time. every time. that's why if we're ever late for an appointment, we'll credit your account $20. it's our promise to you. we're doing everything we can to give you the best experience possible. because we should fit into your life. not the other way around. >> it is 2:00 p.m. in new york. welcome to "bloomberg markets." ♪

>> from bloomberg headquarters in new york, good afternoon. i'm david gora. u.s. markets taking investors on a wild ride. oil rebounds from a near seven-year low with volatility continuing. chipotle shares falling for the fifth straight day. forced to close their boston location after 80 college students got sick after eating there. it is beginning to look a lot like christmas, but it does not feel like it with above average temperatures across most parts of the country. what that could mean for retail. let's head to the markets desk. matt: we have seen markets go down big this morning. we recovered somewhat this afternoon.