here in new york, good morning, i'm betty liu. what we're watching at this hour, we are about half an hour into the trading session. what a difference 24 hours makes. oil is heading higher. new data this morning showing retail sales increasing for a third month in january. maybe those lower gas prices? nba techake you to the summit where we will hear from dan gilbert, and the majority owner of the cleveland cavaliers. also, kenneth feinberg telling you about his role overseeing claims from the volkswagen emissions scandal. plus, what he thinks about current practices on wall street. let's head straight to the markets desk were julie hyman has the latest on some breaking news on consumer sentiment.

it is the pulmonary reading on february and found consumer sentiment found -- fell to a four-month low. we've seen the effect of lower stock prices around the globe having an effect on sentiment. the preliminary index falling to 90.7 in february from 92 in january. what was estimated by economists. the other number in his report is household long-term inflation expectations fell to the lowest on record, going all the way back to 1979. people not looking for any inflation, especially with the declines we have seen in commodity prices and prices that people are paying at grocery stores, for example. if you look at stocks, we are seeing them hold up, although, they have trimmed the gains, even a half hour to trading when we were open this morning, we saw stocks up across the board.

in particular, the nasdaq is now showing more weakness relative to where we were earlier. take a look at the imap. financials are leading the gains, following on the heels of commerzbank in europe coming out with earnings that beast estimate. financials here are bouncing back. most of these groups are rallying. health care would be the exception, sing a little decline. on the bank front, not just financials, but banks specifically, the worst-performing group in the s&p, when you look at the 24 seven industry groups as opposed to the 10 broad ones. you can see a decline of 21% for the year. one other thing i want to mention, oil prices. in addition to financials helping buoy stocks, we're single oil prices hold up well, rising for the first session and seven, up 5%. because we have seen as correlation between oil and stocks, this is helpful. betty: it is.

we are still seeing that risk ff trade, right? julie: to some degree. gold prices rising to the highest in about a year. now we're seeing a little decline in that today in the gold trade today. also, watching the 10 year yield and it is still at its lowest in about a year, even if it is of taking a little bit today to 1.68%, which is still a very low level. finally, the dollar as well. we want to get a check on that, the dollar gaining a little bit. the sentiment number was not feel the report we got this morning. advance retail sales earlier came in a little better than estimated. betty: thank you, julie hyman the markets desk. let's check in on the news. vonnie quinn has more from the news desk. vonnie: thank you. european union countries are poised to restrict passport free travel by invoking an emergency role two years -- role for two years.

eu policy makers are ready to declare that breeze is sailing -- failing to pursue his -- failing to protect its borders. the u.s. and russia have compromised and agreed on a truce in syria to begin next week. they met in germany. the kerry afterward said truce represents a pause in the syrian civil war and not an agreement to end it. >> there many different crosscurrents underneath this that make it complicated, but we are convinced that that is the only way that syria really survives and can flourish again and that you can make peas. vonnie: coalition forces who still launch attacks against islamic states will be able to continue doing so. meanwhile, u.s. and russian planes will drop humanitarian assistance and to some of the syrian towns hit hardest by the fighting. the world health organization vaccine isible zika

at least 18 months away from large-scale trials. 15 copies or groups have been identified as possible participants. , power and today water was stopped to facility shared with the north. more than 50,000 south korean workers worked at the site. i am vonnie quinn. betty: thank you. bear marketned, the is back. the pledging global equities this year has turned into the full-blown bear market. the world equities index is down 20% from its high in may 2015. when it comes to pointing fingers, janet yellen says monetary policy is not to blame for the current turmoil. >> around the turn of the year, we began to see more volatility in financial markets.

some of the precipitating factors seem to be the movement in chinese currency and the downward move in oil prices. i think those things have been the drivers and have been associated with broader fears that have developed in the market about the potential for weakening global growth. -- spillovers to inflation is bills over to inflation. betty: cohead of equities and chief market strategist says the emerging markets turmoil may push as into a recession. first, peter, what janet yellen said, it is not about monetary policy, it is about all of these other factors. do you agree? >> i don't, as you know. it is a bigger picture, though. the fed had to act out of the financial crisis to bring yields down, to buy assets at were not

trading in line with her phenomenal value. none of us disagree with that. then of us disagree with the fact the fed has a role in situations like that. however, excessively accommodated monetary policy for as long as we have had it has led to excision's desk decisions when it comes to capacity increases that are not rational. it is the sort of the market, the price-fixing of capital. race fixing historically has not worked, -- price-fixing this turkey has not worked. undisciplined capacity coming online, especially in emerging markets, china specifically. betty: you think emerging markets will push us into recession. that is a possibility. is it likely? >> i think it is likely. at this point, global growth looks for in this. i am a has brought down the global forecast since -- the imf has brought on the global forecast. i am using them as an example, but they're not all that accurate.

emerging markets are much more important now than they ever have been. there is not a historical and a lot we can point to this has emerging markets will drug developed economies into recession, but things are different. the last time we had a scare, 1998, china was 3% of global gdp. it is closer to 14% or 15%. growth,portion of the about 50% to 60% depending on how you measure it. the fact is, emerging markets are incredibly important to global growth right now and have the ability to drag as into recession. betty: unless the u.s. goes into recession, isn't that a small chance? >> the idea is, that slow global growth leads to the u.s. recession through many different mechanisms. it becomes self reinforcing. by the way, emerging markets have taken out a tremendous amount of dollar denominated corporate debt. that has increased from 120 and dollars at the turn-of-the-century to about

$4.5 trillion. but it will affect their ability to pay those loans back. that will affect the health of the global financial markets without a doubt. betty: how scary is it that we are -- we of the negative rates, we continue to see more and more negative rates from central banks, and yet the markets just -- the global markets are officially in a bear market. how scary is that? >> it is -- it is in question at this point. doing the same thing over and over again when it is not working and when the unintended consequences, negative consequences, our the benefits, it seems ill-advised. and it is worrisome. scary may be an overstatement. the fact of the matter is, we cannot avoid the business cycle. monetary policy is designed to

smooth the business cycle, to make it less painful. it can't be avoided. capitalism requires the business cycle, requires as a price adjustments. in my opinion, at least, an attempt to prevent the business cycle over the long-term is going to be failed. they: it is distortion of other end, too. where is the opportunity? where has been oversold? of large-caprish banks. we were contrary and. we said, selby banks, short the banks. betty: you are right. but why were you? >> pundits would come on inside the fed is raising interest rates, that is good for banks. there is a causal attribution going on. it is not the fed raising rates that makes banks do better, it is the conditions surrounding higher rates. the yield curve stevens, they lend or profitably on a super curve. are these is is the curve will but an for many reasons,

flatter yield curve was going to blow that out of the water. it was not a balance sheet thesis, but profitability thesis. we're seeing anecdotal evidence it is handicapping banks. just a week ago, maybe a week and a half, we put out a piece that said the bank selloff is overdone. banks technically. betty: they are trading below their book value. >> they appear to be cheap. we of this recessionary scenario in the background, so it makes it difficult to love banks, but they are, in our opinion, oversold. betty: jamie dimon is right. >> who could say he is wrong? betty: thank you, peter. much more ahead. one of the most influential names in sports and business, dan gilbert, owner of the legal and cavs, founder of quicken loans, joins us live from the nba all-star tech summit in toronto, next on "bloomberg

market." ♪

betty: welcome back. the cross-section between sports and business, stephanie ruhle is in toronto covering the nba all-star tech summit. she is standing by with a very special guest, dan gilbert, the founder of quicken loans and owner of the cleveland cavs. stephanie: there's so much to cover here with dan. before we get into nba, let's talk again loans for a moment. in the lending business, we're so focused on the health of the u.s. economy, from your perspective, what does it look like? >> housing is doing pretty good or ok on the high end of ok.

overall, u.s. economy, i call it --t of stephanie: meth? >> i don't think there's a lot of capital investment going on by companies, huge cash on balance sheets. not a lot of investment. i think you'd like to see a lot more investment and job creation. i would give it 5.5 or six out of 10. stephanie: do you think it is worsening? we're janet yellen saying doing well, raising rates. are these jobs being created, was that are impacting the economy? >> that is a good point. the high and job creation, if you look at it by sector, probably isn't doing a great overall. copies are conservative, being very lean. are theselike there huge amount of industrial jobs or blue-collar jobs being created like there was maybe in previous recoveries.

i think that stems from the lack of investment in the last -- lack of risk-taking by companies. the question is, why? ofertainty is the enemy investment. stephanie: uncertainty is only going to worsen. as you look at quicken as a lender, are you concerned that maybe lending practices over the last five years were to lax if we're taking a downturn and companies are going to slow down? opposite,plaint is lending has been too tight in commercial and residential. there is a case to be made. we focus at again, america's second largest residential lender, we focus on technology. leaner, quicker, smarter from a quality standpoint. as far as we are concerned, our defaults are real good. where the lowest default fha lender in the united states. we are focused on what we do. that is really not a great signal in the u.s. economy overall because we are learning

primary first mortgages. people make those payments, for the most part. stephanie: who are those people? are they changing? who wants to make these big purchases? is it still the and entering to own a home? >> there is to problem with millennials in home buying. number one, philosophically, the sharing economy and want to be mobile and maybe don't want to put down roots as previous generations did. they came up in the financial crisis. they are even a little less apt to invest in a home. they saw home prices go up, up, up like previous generation or two or three, they saw the first time in 80 or 90 years were you saw a crash in housing prices. they came of age in that and saw that with their parents and all of that. there looked hesitant. we have seen a little bit of a move in the last year or so. biology sooner or later kicks in annapolis settle in a nest and get a house.

biology sooner or later kicks in and they have to settle in a nest and get a house. u.s. economyu say is like a five or six. where were we last year? >> maybe six or seven. i don't think the last seven or eight years, since the recession, the great recession, i guess, we're seen any kind of recovery like you have seen -- i don't know how many have been since post-world war ii, that many of them. this is not quite have the legs as previous ones. stephanie: if we're seeing a slowdown in increases, some cities like yours, detroit, could get hit much harder where you have new york, l.a., chicago are stronger terms of economic ties. what does it look like for detroit? >> the good thing about detroit in downtown detroit and even neighborhoods which are now recovering or recovering -- starting to recover, it has been flushed out. detroit was the biggest been visible bankruptcy in history.

that big debt burden is sort of .one you're seeing diversification like never before. he used to be all cars all the time. it still is cars dominating, but they have become technology on wheels. i think you have seen from the three-day automakers, big, big push into technology. the ces and las vegas, i was there in early june were come all about cars and technology. as long as i keeps going, the car companies i think are now andlly in the 21st century, they are technology companies. that is diversification within the auto business. then you have way more diversification in the city itself. our business and what we are doing is some of the biggest pizza makers are in detroit, little caesars, domino's in ann arbor. you have banking, and a lot of things going on. stephanie: we saw many people lose their jobs in the crisis. now those jobs at car companies and other companies are so technology-focused.

how much of the population are workers that simply don't have the skills to fill these? >> that is a big challenge. it certainly is. the good is part of it is, if somebody doesn't have a degree -- you don't need a four year degree or even a two-year degree. if you educate yourself, become a web developer or even a help desk guy or whatever it might be, you're going to be just in massive demand in this economy or any economy. we have seen that. we've seen high school dropouts and a 21 years old get paid 100,000 a lazear because they have the skills that companies are so desperate for. to me, it is not the for your college-educated degree that is going to get you where you need to go, it is getting yourself educated or taking some training classes and quickly becoming a technologist in some way shape or form. stephanie: let's talk about what is going on. you have your flinch, michigan, situation. how that is it? people's homes are being marked down to zero. >> it is a very serious,

challenging situation. 70 miles north of where we are at, but we feel the effects of that to a degree. you feel for the people. i think now you have the state and governor snyder and even the fed helping to a degree, and certainly, the business community and nonprofit community all around, southeast michigan jumping in, but it will be a while until flinch recovers. it is a snowball effect. not just the water, now you're talking about housing prices and other things. hopefully, this capital that comes in gets used efficiently and in a smart way that helps flint recover. maybe you could make a case for that it recovers better that it would have otherwise because they're so much attention on it. i would hope that is the silverlight in. stephanie: you are doing a lot of smart things in a game of basketball, not just with the cavaliers banking gems, but courtside ventures. moehring technology and the sport. what are you doing now? >> at courtside ventures, it is

a partnership that we are very, very excited about. we have some guys who have been doing this for a long time that are partners with us. we're investing in any kind of sports technology and things around sports technology. there was a company launched out of detroit this week which was really interesting thing because it is a stock market for sneakers. stephanie: it is an exchange. >> a liberal exchange. right now, multibillion dollar secondary sneaker market. epa -- literally, buyers and sellers, looking your portfolio in real time into the pricing just like stocks go up and down. it is well done. these guys did a great job with it. it just launched on monday or tuesday and there are tens of thousands of sneaker heads who have signed up and are exchanging shoes. stephanie: when kanye comes out with issues? >> it is. we will announce several large

than entertainers and a sneaker heads as partners in this very shortly. this is great because you finally get visibility. trade isn't settled until somebody is an expert looks at the very pair of shoes that is being sold before the money is released out of escrow and if you days. it is an interesting concept and nothing like it on the web. stephanie: as you grow, is the next stiletto exchange? that would work for me. >> the tagline is "the stock market of things." we're talking about watches and handbags and i don't know what i stiletto is -- stephanie: high heels. >> oh, ok. i could use those myself. not those exactly, but the heel. stephanie: do you think you could be a platform as big as amazon? model that is at the you are trying to create? >> it is funny because we talked about this in our strategy

sessions. you talk about retail for hundreds of years and amazon, buying it directly, ebay auctions. this is a completely new form of it, the stock market of things. it will not apply to everything, so it has to be a limited edition, maybe collectibles. you need enough of the same thing to create a liquid market. you -- it cannot be too commoditized like oil and gas and all that. for a big chunk of the products in the marketplace -- they somehow the sneakers to got this week, we are feeling even better. stephanie: across her businesses, when you think about what you are most concerned about, what you're worried about, what is it? especially, being from detroit were you -- you are in a relatively depressed environment. >> the biggest concern is the overreaching power of the federal government and the kinds of things that they're doing today that we have never seen before -- at least, not in my lifetime. it is very, very disconcerting to businesses. i get calls every day from ceos

of public companies, private company's, just with stories that are not even out of stuff going on. biggestme is the concern. also, this believe that companies and corporations are evil across the board. shareholders of companies, public copies, shares her own by pension funds and public unions, i mean, this is america. we create wealth through shareholder value. this concept that some folks are selling that the americans system is evil, to me, is a concern. stephanie: are we not celebrating entrepreneurship as much as we should be? >> i think a big chunk of the country is. stephanie: but the government? >> currently, not. i don't think they believe in it, friendly. stephanie: how concerned and focus are you on the presidential election? >> i think is one of the most important, biggest presidential elections -- i will just go by my lifetime -- what i have

experience. i think your list when i can remember is carter or something. that was way back before the turn-of-the-century. i am very concerned about it. i think all americans should be. stephanie: what would a bernie sanders presidency look like for you? >> it is hard for me to comment on speculation on things like that. i think we have heard some things that are very concerning for those who understand how wealth is created in america and how jobs are created and all that. i will leave it at that. i'm sure: we don't -- he wants lebron and the cavs to win the season. betty liu, i will send it back to you. i'm here to nba all-star tech summit with dan gilbert. betty: we will be right back. ♪

betty: live from bloomberg world headquarters, you're watching bloomberg television, i'm betty liu. let's check in with vonnie quinn.

vonnie: the u.s. national institute for health and needing company had the lead in developing possible vaccines for bowers according to the world health organization. the agency says no one is close to connecting clinical trials. >> in strike of the currency describe landscape, at least 18 months away from large-scale trials. linked toka has been birth defects and spread by mosquitoes. privatizing air traffic control system, advancing in congress. housel past the bill in yesterday, turning it over to a private -- private nonprofit corporation. it is backed by the airline industry. in oregon come the last four holdouts of the armed occupation of a federal wildlife refuge go before a federal judge today. they surrendered to federal agents yesterday. seven other people in six states were arrested, accused of being involved in the occupation.

minister david cameron goes to germany as part of his final push to get concessions for european union membership. he will meet with the german chancellor and attend a banquet in hamburg. next week, he hopes to reach an agreement with other eu leaders. he wants british leaders to decide on eu membership in june. after george clooney and his lawyer wife amal had a private meeting with german chancellor angela merkel. they were accompanied by david miliband, who now heads up the aid group international rescue committee. the clintons plan to meet with looneys plant to meet with refugees later in the day. betty: thank you. for look at how u.s. markets are trading, we are now just at our highs of the session. abigail has the latest life from the nasdaq.

>> it is early on but we are already seeing lots of volatility and biotech. the index opened nicely higher, only then to trade down nearly by 1%. now down just slightly, but this is the biotech air market only gets worse with the mbi down nearly 40% from the july 2015 peak on a mentality of sell the high momentum and high valuation names of everything years, a sentiment that seems to have dragged on the nasdaq overall more recently with the index not so far from a bear market itself. one of the big drags on the biotech sector, mylan, shares down today after a nearly 20% drop yesterday on the news the generic pharmaceutical company would buy another for $7.2 billion. calls it a will to destroy until. perhaps it was the 92% premium at the stock price closed that cause the deal to go through this time. jpmorgan is a little more

constructive, and analyst says the selloff is an acquisition that is an overreaction in the acquisition of publishes several key goals. betty: abigail, thank you. the fourth annual bloomberg intelligence health care event underway here in new york city, featuring leaders and pharmaceuticals, biotech, and healthcare services. one of them is with us now. chairman of former allergan before it was sold it one of the biggest deals of 2014. david, i know you were on with us when that deal was announced. great to have you back again. since then, we have seen so many pharmaa deals in the sector. is that only going to continue this year? >> one of the topics of the session this morning was will things continue at this rate or will they slow down? i think one thing that one has to contemplate is companies that

are, unfortunately, suffering in this downturn, vertically in the biotech sector not sure they look at the high point of where their stock traded. that makes you less willing, you know? on the other side, on the bi-side, one should not underestimate that it takes a lot of time to do proper due diligence. in my case, we looked to copies for half the year before we kind of -- betty: it absolutely takes time. you're saying with the market turmoil, the shine has been taken off? we may see some but not as much or as vigorous? >> if i were to predict, i would say a little slowing down. but the great thing is, in down moments, there are people who are saying, is this the great time to buy some assets at much lower than normal price? betty: speaking of your former topany allergan, they sold

generics, a legacy, to pfizer. what did you think of that deal? post impending, to vest a jerk of generics, the new allergan to a great degree looks like the old allergan, plus maybe you can add, clearly, the very valuable assets from forest labs and some of the other acquisitions that forest made. betty: ok. but let's say it a grating some of those assets into pfizer, what do you think pfizer will do with it ultimately? >> in any large-company, the question is, how do you maintain focus? i have always been very vocal on that one. i think companies should really ideally be number one or number two in each of the therapeutic areas they operate. that is how you become a partner of choice, how you maintain a situation, how you grow the market as the leader of the

market will stop and i think that is one of the key challenges to the new pfizer incorporating allergan. betty: and maybe to the point were they have to state innovative and flexible, with a have to split the company up? forhat is really a matter pfizer. i can just all of the reports just like you and the viewers, too. betty: you gave your keynote speech at the conference, and speaking of splitting, you did mention hours of possibility perhaps that you could see a scenario where italian may have to split up? >> the you're so ago, now 18 months, i was criticized for likening valeant to tyco. we all know pretty much -- i think looking back, a lot of -- betty: which is why you decided not to do the deal with the. >> and from a material point of view. 62% of the valiant offered was in their stock. we has a board of directors were

really obligated to do our homework to say, what kind of equity are we accepting on behalf of of our stockholders? and the more we did to analyze that, the more skeptical we became. in june of 2014, we pointed out the importance of price increases to that business model . of course, at the time, we did not really understand how philidor was going to develop. of course, we could not predict the amount of debt that would be taken on by valeant. i think in this risk-averse markets, it is going to make it very difficult for valeant to continue to purchase assets. it ago so the answer to the recovery is to become smaller or split off their assets? >> i read the comments made by valeant management and it is very much focusing and paying down debt. if i were there, hypothetically, i think that is a pretty sound

approach. betty: is it were you, essentially. was taken tot congress on a high drug case. did you watch martin shkreli? >> that was a bit of a soap opera. i think, unfortunately, there are a few bad actors in the industry causing a lot of distraction. but a but higher drug pricing is an overall trend, david. in some cases, the prices are 50%, 60%, 100% higher. >> i think there is the role of the generic industry. that is the job of generics to come in and offer alternatives to the originator. the second part, i think, is i think if there is a silver lining in this whole situation, i think most responsible pharmaceutical companies in this time period will be actually

careful about what kind of price increases they post. and one last point i would like to make is, of course, managed care does its job in terms of once you have a high price increase, you price increase is much lower because of the rebates that have to be paid. and typically, in the medicare part d contracts, if you are cpi, consumer of price inflation, there's usually a pretty big clawback in terms our rebate onk the excess. headline and net can be quite different. betty: that is a point that someone like martin shkreli have been trying to make, the problem is, everything else distracted from what you're saying is a valid point here that mitigates -- the drug spike you have seen. in your opinion, quite unfortunate, that you had a martin shkreli come out, a kind

of clouds, right, the ability for the whole drug industry to get a rational message across? real challenge. i'm pleased to say some of the trade associations are really stepping up to put out the real eventuallyw drugs really lead to dramatic reductions in overall health care spending. of the great examples hiv drug market, hepatitis c market, some examples of the tremendous value of medicines. betty: david, what are you doing now? are you going to start another drug company? >> no. i'm about to write a book on innovation and what happened at allergan. a lot of interest in that. hoverboard sevcon i'm working on building a hospital in africa. that ago thank you so much, david pyott, former chairman and

ceo of allergan. much more ahead. groupon trading at the lowest price in years, but is there a recovery finally in sight? look at the stock price today, surging 26% following the earnings. the groupon ceo rich williams joining us right after the break. ♪

betty: welcome back. this is bloomberg market. we are climbing ahead. abigail has the latest live from the nasdaq with a pretty big rebound. your starting with activision blizzard. >> not on the rebound, but going the other way, the stock is down sharply after the company class

holiday -- copies holiday sales plunged, causing profits to miss estimates. they made $.83 for the fourth quarter. it is being blamed on lower-than-expected purchases of the sky lender and guitar hero game, but also saying the stock should be bought on weakness. one says this is the company's first since 2011, but the core business did well. evan wilson says this is the most established gamer, attractive valuation, it should be bought. taking a look at one of the best-performing stocks today, groupon, it is a penny stock, but shares are soaring, of more than 25% after the company's fourth-quarter revenues beat by 8%. customers were up 3% in the december quarter. a held revenue outlook for the year. the stock, however, is still down about 90% from the november 2011 ipo. betty: abigail, thank you. just reporting, this is the first earnings report

under new ceo rich williams replaced the cofounder last november. he took the helm in 2013 after his fellow cofounder andrew mason was pushed out. williams, former amazon executive, faces this daunting task of making the former internet darling relevant again. rich williams joins us from chicago. good to have you with us. clearly, investors are plotting the earnings report from yesterday, that the on revenue i think suppressing a lot of wall street analysts, what more work needs to be done at groupon? >> thank you for having me, betty. we're just getting started. when we set out in november, when i took my role and we set out with a very simple plan, just a handful of things, really just four things this business and team needs to focus on in the near term and really over the stretch of 2016, and those are very basic.

our shoppingrove margins, get our goods business and that experience moving forward, make it more profitable. calories, grow the customer base and invest more and bring more customers to the groupon marketplace. there focused on improving customer experience and streamlining our footprint. i think that is what you have seen over the last 100 days or so, that we have executed on those four areas. we're starting to make progress on those four areas. faster progress than we expected. our work is not done. with a strong holiday season, ouromers responded well to groupon brand, but that is holiday and we need to prove we can do that throughout the course of 2016 outside of holiday peak will stop betty: and work to be done on your senior management team. you are still in search of a cfo? >> we are. we have an active search running. we're just really fortunate to have someone like brian, our interim cfo, doing a great job

on the spot and helping out. a great partner for me through this period. we will continue to build our management team, including the cfo role over the course of 2016 and beyond. betty: ok, so a lot of people have said, rich, even know it seems like groupon is finally getting back on track, the stock price is down over 90% from the ipo. attractive a nice, acquisition target. are you open to that? >> i agree, the stock is in a place where we feel it is undervalued, that is why we continue to buy back shares in the company, which is a great long-term bet. our focus as a team is done on things like acquisitions are being acquired. our focus is on building a great business. that is long-term, what we would have to do no matter what. we see the long-term potential in unlocking the value for shareholders. that is what we're focused on, those four things we think are going to help us do exactly that.

everything is at this point is just so far outside of our field of view, and i think that is exactly right for where we are as a company. betty: what is the value proposition of a groupon as an independent company in five years time, when you have major players -- you mentioned to delivery on the call yesterday, major players like amazon and uber and others getting into that space with a lot more money and a lot bigger resources behind them? what is that i proposition of groupon in independent brand? >> i think the value proposition of groupon as an independent brand continues to show itself. we're at a place where we talked about this before, we sold a list one billion groupon's only continue to grow in the north american business, the eighth straight quarter of double-digit growth for that business. we continue to grow as a standalone company. we have great assets. i think a set of assets that position is extremely well to play and not just play, but win and a bunch of these areas.

26 million customers in north america, 50 million worldwide. we have an extremely strong balance sheet, over $850 million debt.ith effectively no we have the wherewithal and the ability to support our initiatives and continue to grow the business. we think that is exactly where a company like us once to be at this point, positioned well with the value profit that is clear to customers, clear to merchants, and that is helping us propel growth in the company and move to a stronger place. betty: you mention the cash part. i know you're increasing your marketing spend. that is your real house, right? where exactly are you going to be spending this money? increasinged in q4 our marketing investments. we spent a little more money, about 20 finally dollars more money in the quarter. it was brought across all of the channels we operate in. we heavily focused to the online space. for the first time in a long

time, you saw it move back into the off-line world a little bit. we tested in radio and a handful of markets, outdoor advertising -- specifically, for take-out and delivery and some of our order up markets. i think you'll see that continue to play out throughout the course of the year. we have a lot to do to unlock -- i think the value inherent in the brand. it is a very well-known brand, over 80% awareness in the u.s.. if we can unlock that through traditional online marketing, but we also need a place for things like tv, longer format video advertising that can help people understand where groupon has changed and is different than how many folks perceive it to be, which is much more rooted in the daily deal path. it is a different product and company at this point. you will see is investing more in advertising to help tell that story in a much more effective way. betty: rich, they get so much, rich williams ceo of groupon after the earnings report. still ahead, i sat down with kenneth feinberg, the former

so-called pay csar. we talked everything from volkswagen to wall street compensation. those highlights just ahead. ♪

betty: banker pay and bonuses back to the forefront. i sat down with kenneth ,einberg, the former pay czar bank bailouts. structure payn and bonuses. >> there is a growing animosity, political pressure that if we don't narrow the gap between the very well-off and those less well off, there will be some sort of tax on pay, there will be some sort of administrative regulation by the fcc or the federal reserve or the fdic sheila bair did a wonderful job

warning about pay. i think we will see more and more of that. that is the pressure. betty: should the bonus structure be taken away, for instance? >> look, i think the bonus structure, if it is one to remain, ought to be based on long-term company improvement, shareholder value, not personal, individual bonuses. when i was at treasury, as you know, what we did is we said, if you're going to pay a high-end corporate official, that high-end pay off to be tied directly to the overall financial performance of the ispany that she or he administering, and not personal benchmarks or objectives. it out to be paid out over 2, 3, 4, even five years. long-term, not short-term. and i think if you're going to have bonuses, that is the way it

ought to work. betty: i've always think you're is a year your opinion, do you think the page structures of these wall street firms and also in europe, it is an incentive for people to do wrong. >> that's right. i still believe that. betty: ok. >> i guess the argument on the other side you here is that the incentive to do wrong, if wrong is not a legal, but if wrong involves risk-taking are short-term gain, that that incentive on to be discouraged. , it i did was send a signal don't think there is any long-term benefit from what i did. i think just the opposite. street, if that wall it had a little more vision and long-term political sense, it would recognize on its own that we better rain this in because otherwise, there will be

political -- political consequences in the voting booth and political consequences in the administration, at the fcc, fdic. betty: politically, you're seeing some of that, are you? don't you think? >> you are certainly seeing candidates troubling that. whether or not you yet see any hard evidence of that, i don't. what might be is a warning signal, i think, to people on wall street that they better take voluntary action or they will rue the day. betty: that was part of my conversation with ken feinberg. the european close is next. ♪

betty: it is 11:00 a.m. in new york, 4:00 p.m. in london, and midnight in hong kong. good morning, i am betty liu. close, to the european

mark barton joining me live from london as we wrapped up trade in the next hour. we have this rally going. mark: it is the second daily gain and european stocks. the european close starts right now. betty: we are going to take you live from new york to london in the next hour and mark kicks things off. mark: we are off by 2%, we have 30 minutes to go in the friday session. every industry group is rising. basic resource stocks, bank stocks are leading the rally. let's get serious, it has been another week of declines with stocks falling as much as 5% this week. banks have