david: from bloomberg world headquarters in new york, good afternoon. lisa: here is that we are watching this hour. david: u.s. stocks are fluctuating as the dollar continues to rally against the yen. but taking on higher interest rates could actually be true. lisa: pandora makes management changes at the top while he considers its future. the name to the cofounder as chief executive. investors do not like what they hear. david: why the largest rough diamond producer is seeing a glimmer of hope despite a rough global economy. let's go to the market desk with the julie hyman. julie: we are looking at the market that is not moving very much. volume is down sharply versus the 20 day and 100 day averages.

it is still a vacation week for many. we saw a lower volume last week and is characterizing trade. we are getting a little bit of steam as we head further into the session. up 0.2%.nd s&p overall, mark's do feel a little stuck in neutral. -- markets to feel a little stuck in neutral. 714. this is something bloomberg saw in a story today. it has been 10 months that the s&p 500 has gone without making a new high. despite the recovery, it is still 100% -- 100 points below a record. something that is relatively unusual. it is the longest streak of this kind of thing, not making any new highs outside of a bear market since 1995. we go back to 1976 and look at the bear market and these streets we have had, stocks going without making you highs

-- streaks we have had, stocks going without making new highs. if you look in the performance of averages, we are still se eing gains in the dow and the nasdaq is the laggard on the year. given the fact that technology tends to be the leader on the up and down side. nasdaq still not gaining back all of its losses this year. lisa: there has been quite a recovery in the u.s. market cap. julie: we have met a new high, themhere is a balance of last month and a half ever says the low on february 11. the u.s. market cap, we have seen a recovery of $2.5 trillion over this period of time. it has coincided with a batch to an early assets, oil areas we talked about the correlation between oil prices and stocks.

they had an enormous bounce after enormous downside in the prior couple of years. still 40%. it is sort of a good news, bad news scenario. we have had this degree bound that has not yet retained again. david: i will talk about that in a few minutes. lisa: let's go to first word news. mark crumpton is over there. mark: passions and tensions running high on both sides of the debate. the general says he will veto eight religious bill protecting opponents of same-sex marriage. >> i do not respond very well to insults or two threats. the people of georgia deserve a leader who will make sound estimates based on solid regions -- reasons that are not inflamed by emotion. mark: a number of major companies will threaten to take their business elsewhere if that bill became law. among them, disney, intel, and time warner. filedy rights groups have

suit against north carolina. they say a lot requires students to use bathrooms assigned to their biological sex endangers transgender students. takes away protection from general identity. in president obama's choice for the supreme court is meeting with two more senators today. this includes joe donnelly of indiana and ben cardin of maryland. kirk illinois senator mark or if you will be the first republican to sit down with judge garland. the senate leadership is refusing to consider the judge's nomination, saying the next president should choose the uccesesor to antonin scalia. justices left intact the man's conviction on 13 counts.

he is serving a 14 year term, although that may be short. global news 24 hours a day, powered by our 2400 journalists in more than 150 news bureaus around the world. met to you. david: u.s. stock swings continue. the s&p halted weekly increases since november as rates will rise as soon as data warrants. scarlet: here is john manley. $15 billion under management. i have got to wonder, equity markets have largely rallied since the ecb announced more stimulus and the fed coming out suggesting they may not raise as quickly as they thought. at what point will bad news stop being good news and good news stop start the bad news. >> if we lose faith that they can get it done. they almost always get it done. the federal reserve, the ecb now

have limitless say. they have the biggest pockets in the world. when they push, they are actually pushing money toward the economy. capitaled to the markets. it is not like we anticipate. there is a powerful difference. when the ecb announced the buybacks, sure, it is heading for the economy. ecb,he economy and the white the critical market? david: sticking with central banking, that yellen is speaking tomorrow. we will have that speech noon tomorrow. what are you going to listen for your ? >> i want to address this thing that they know and she does not. she is a very smart and accomplished woman. the problem is, when you are you at something as you know on tv, you can say something that does not come out quite the way it

would happen. but you get better at it has ago along. i think she will be as transparent as she can. she will say that she will raise rates whenever she thinks she can do it without it being tightening. that is important. ask yourself a simple question in the next 12 months, the fed want to encourage or discourage economic growth? that is the impact it will have. lisa: what stuck markets still have the run given the central bank stimulus? markets have the most room to run, but they cannot even walk yet. lisa: what about specifically? >> i am not wild about latin america, latin makes the -- africa makes me worried. but there is room in southeast asia. maybe china is not going to grow that fast, but they are not in control. india is going to grow well. i am not playing resources.

it is far too soon to play inflation or resource appreciation. there are real values there. if you want the balance its meantime and potential, continental europe is still very attractive. it has been cheap for three or four years. but the reason it was cheap is going away. and that is when you lose the value. david: we of economic data about consumer spending. sentiment seems to be there is a lot of apprehension of the equities market. you have got converse, equities looking at economic data that is so-so. how do you process all of that in your capacity? >> that is i you break your neck, looking over your shoulders twice. the day, the consumer is also looking at the better job market, housing market. savings rates they have not seen for a while. but are not involuntary unplanned. the money trickled in when it did not go out the door. they cool the house, run the car. that is what gets people to

spend. once the american consumer gets going, he or she is like a russian army. they are hard to stop, very powerful. he gets the consumer going. the animal spirits return. the fed has done what it set out to do all those years ago. lisa: what do you say to people that say fundamentals do not show gains but suck markets are suggesting, we are worried about the level? .> i don't see a bubble i have been told that myself. i don't see a bubble. i see markets are stalled. valuations are neutral. they are bullish and fair value. ofget significant advance the stock market, stock needs the overvalued. that is not hard. it would not be fair value if it was over evaluation or undervaluation. the market has been dead flat for 10 months since the last new high. earnings have to -- earnings have been dead flat.

there is no bubble. the market is quite rational given the lack of change in earnings. accelerate or decelerate. i think the economy gets better on the accelerate side. if i am wrong, that is where i am wrong. david: thank you. that is john manley of wells fargo. in the next 20 minutes, new management at pandora. the founders as ceo, but the move is creating static among investors. lisa: diamonds have lost their luster, but one of the word is -- largest producers says that is changing. ? a clean sweep for bernie sanders, but is it enough? ♪

david: welcome back. the pleasant hotel auction is said to have been canceled as lenders grant an extension. that was going to be doing by david rubin, the brothers who own the hotel. it was auction canceled as leaders just lenders grant an extension. university's $6 billion investment is losing since 2010. aj edwards said the chief investment officer posted march 31. it is lagging behind ivy league gears and they will collect his permanent replacement by april 15. rate.ng chicago's the illinois supreme court talked about cutting the -- this ruling was among the most difficult. tickets for the opening day of the new shanghai disneyland sold out within hours after going on

sale. the park opens june 16. they are targeting 300 million chinese within a three-hour car or train ride. that is your bloomberg business flash. let's go to the market desk where julie hyman has company numbers. julie: they are going down. i want to start with pga partners. this is creating quite a buzz on wall street. a former managing director at this partial group in the bank. he was arrested and charged with defrauding investors including a charitable foundation, and we are talking about $95 million that he allegedly sold. moneyegedly sold the through private equity investment. he lost millions through aggressive trading in his own account. he was fired from the firm on monday. that is today and was arrested on march 26. earlier andof this

began investigating and alerted the authorities. p j t has publicly traded and shares her plunging by now 11%. also looking at the rental car avisnies today, hurts and -- hertz and avis. a drop in pricing according to the m analyst. there is we commercial demand and wheat inbound travel. that is domestic travel as well as international into florida because of the mild winter and what we have been seeing happening with currencies. both of the stocks are lower today. and pandora media has been exploring a sale of the company. the cofounder will return to the company as chief executive officer. that is more than a decade he departed the company and replace d brian mcandrews.

the stock has been going down after he says he does not favor a sale of the company. there are questions about that. also according to paul sweeney, one of our analysts, they are reigniting growth but it is trickier. more into this issue, but it is an interesting ongoing story. alisa: thank you. david: let's continue the discussion of pandora. reporter who covers pandora. westermann bring to the table? >> tim westermann has really been very much up front for pandora. that is the inspirational jazz pianist, musician founder talking to employees inside of pandora, talking to artists outside of pandora. i think that elevating him to ao is something that has been public persona of the country

and puts him in charge and that makes him a higher profile phase for pandora and the vision of where they need to go. alisa: what is his first step need to be when he gets into work tomorrow? >> i have to defer to him, but the sense i get is that there is not a lot of change. he is a very senior executive in company. he has formulated a strategy to add a pricey at least for pandora expensive proposition for building an on-demand service. spotify and apple are like this. who areed by cfos adding the president title and a couple of other senior executives hired by mike andrews. the tenets set the strategy pursuant -- pandora is currently pursuing will not change. who is anot someone

inspirational face at the company, cofounder, who i think validly seene as as someone less interested in seeing pandora acquired then maybe some investors might prefer at this point. david: how comfortable are you with the sales targets, $20 billion by 2020? is that feasible? >> yes. i think pandora is very well-positioned in half of the business. their ad-based radius "trending business. they had 81 billion active users. there is a lot of opportunity for free music, people that do not want to spend $10 a month for on-demand, and pandora is there go to destination. that is a business. the cost structures that at a very favorable level by a really long, complicated government proceeding that wrapped up at the end of the year. they are in a position to make money in that aspect. the question is, whether their

investors in on-demand are something they can yield through. is base case they can work realistic. they have got a lot of investment and music genome technology to give a personal playlist that can be expanded to on demand. they have a large user base to acquire subscribers from. that is competitive. -- spotify isstop big. even western grand would prefer to remain independent. targeting these strategies, this is a company that would be valuable potentially in the hands of other companies with as to grow in music. alisa: do you think the sale is off the table? >> no. i don't think it is a base case tergren, but if it does work out, a sale is there and could yield great value for investors. david: who might be interested?

other countries interested in acquiring pandora? >> music is becoming software to drive ecosystems and devices. apple has got apple music. they don't have a free radio service. pandora started that. buildht be interesting to an on-demand service like apple or google. combining pandora and modify makes industrial logic. relative valuations would be hard to work out. david: but the basic statements to drive the business, and acquisition can be taken off the table down the road. thank you so much. alisa: still ahead, we look at the health of the community bond market and why some got burned in the search for a higher yield. ♪

♪ alisa: welcome back.

in this age of low interest rates, a tax-exempt bond paying 5% may seem attractive. but as many are discovering, yield could get burned. brian takata joins us now. brian, this is a fascinating story. tell us, louisiana pellets. what happened? reporter: this was one of those file, 300igh pro million dollars work eventually sold for wood pellets in a small overtown in louisiana. it was from a german pellet maker in the largest in the world. it did not work out because of bad weather, construction ever's -- errors, and it does not make a sense in low oil prices and low natural gas prices. david: what does that tell us of a community market at large? reporter: not a whole lot. you talked about chicago being

downgraded earlier today because of the pension risk, and puerto rico has a large fiscal crisis going on. these one-off projects don't work out, and for high-yield funds and even kkr was brought into this initially. alisa: why is a would pollute bondsy selling municipal and have certain benefits. -- why don'ty just they just go to the public markets? reporter: they say it sucks the bonds, the size of 3.1 trillion bond markets. have jobs we create, facilities we create, it is right to be a win-win opportunity. they have a fertilizer plants. it is all over the country. even large names, oh,, exxon.

they have worked this way in the past. alisa: you have seen this real selloff in the riskier debt markets. this comes back somewhat. people are counting for potential default. are they accurately or adequately allowing for potential default in the $100 billion field of bonds that are riskier? reporter: they are not. these corporate backed bonds are not in line with the taxable counterparts. that is because there is so little of it out there, and the high-yield funds have been in float for the 94 of the past several weeks. -- $.10 on at 100 the dollar, based on going to sell at $40? no, you hold at the bottom and see what happens. david: we have addressed the weirdness of the market. trader last week, saying not very many committee bonds available. reporter: that is the way it has

been for the past several years. when you look at 2015, on markets to better than commodities, and that is not accounting for risk adjustment basis. they had the lowest volatility because there is a lot of individual investors. it does not account for the tax exempt interest benefits. a lot of people like to talk about -- returns are everything when it comes to that, it is missable bonds. alisa: thank you so much. municipal bond reporter brian takata. david: the diamond industry is seeing full. others see a bright future. that is coming up next after the break. ♪

david: from bloomberg world headquarters in new york, this

is bloomberg markets. mark: republican presidential front-runner donald trump is planning to make his first campaign visit on tuesday. ted cruz is positioning himself in tomorrow. he'll be a first time since as for delve it -- delegates, mr. trump has 739, mr. cruz has 400 zusi five, and john kasich has 143. side, bernieatic sanders has raised more than $4 million, winning caucuses in washington state, hawaii, and alaska on saturday. it was one of senator sanders largest postelection during the primary season. hillary clinton is urging people to consider the future of the supreme court. in wisconsin, she plans to

--ress republican leaders say they have no plans to move lower on the nomination of merrick garland. global news 24 hours a day powered by our 24 hundred journalists in more than 150 news bureaus around the world. markets closing in new york. let's look at the biggest movers starting with oil. wti fell for a third day on news opec could curb -- iran and libya are the two opec members that have not pledged to attend the production toss. trading's of gold today, investors are backing away from the precious metal on signs the u.s. economy is resilient enough -- prices are closing at 1219.

a consummate to gold after lenny $2 billion, standard charter is asking client get payment insurance or provide 100% collateral. the industry has been marred by default and bankruptcy with small firms overextending themselves. we want to bring in joe with our medics and -- metals reporter. why are they making these demands? >> there is a lot going on in general, among the many think they are trying to rein in. looking at the diamond industry specifically, trying to the ante for the standard. essentially take loans they need to buy rough gems from the minors. going to try to rein it in. in 18% drop in diamond prices just last year. you are seeing there is a moment when we will see some watching out.

>> who are these middlemen and what do they actually do? >> they are family-owned. a numberalking about of them being large, family-owned businesses in india. they need the loans to be able to buy. they polish, they cut, and they trade the diamond. get, if somebody theuying diamond out there, middlemen know and they take it -- i'm thinking in a metals world. they make it look ready. david: we are talking about the , a very small and competitive marketplace with few principles. can you extrapolate a lot? >> one thing it does tell us is it is tough in the diamond industry. demand has and dwindling.

china is seeing slowing growth amid demand across. i think what we're seeing in terms of these specifics is it could be more for longer. >> everyone is talking about negative yields. some people just want to park their cash in a vault and escape at all. it seems like it would be a pretty good way to do that. if anyone out there is optimistically will see a resurgence? recently said last week they are optimistic and i think demand will come back into the market or that is fine. there are still a number of analysts saying that maybe isn't to be expected, you are yes, they actually choked off supply last year expecting prices to continue to decline.

the question is where does the demand come from? china or the u.s.. lisa: these loans to diamond middlemen, they do not make up a major proportion of standard chartered alone? >> it is something like 1%. it is very small but they are one of the biggest players in market, one ofe the biggest lenders for middlemen. for standard charter as a whole, one present is not huge. david: it seems like it is as much as standard charter story tohe see a company averse risk. thank you so much, joe. the u.s. dollar used today after showing retreating inflation and a downward revision to consumer spending. speculation mounts that the fed could consume rates. earlier, the dollar's rise may be over. >> our main concern is a

negative feedback loop. is doing finemy pair the problem is every time you have the dollar rising, concerns about china devaluation, concerns about growth, concerns about commodity markets, those start to resurface. that is what will stop the fed from hiking and really lifting the dollar for now. mark: pretty much no hikes for the next two years. is a call in 2017 at really catches my eye. talk to me about the scenario and how that pivots and transitions into what you think will happen with the market? >> in the short run, it is about risk sentiment. every time you get close to the point where the fed might be hiking, we -- the fed does not have the courage to do that. there is a movement to the second half of the year, starting to slow a bit, unemployment rates.

currencies such as the euro and the yen. be -- aussie dollar, canadian dollar, those are the kinds of currencies that should do well the risk environment. >> a commodity currency call or a risk currency call? >> i think it is both. they should do well across the board. if they are right, preventing the fed from hiking, those currencies will do badly. because of the commodity and risk sentiment. let's take the scenario. dollar strengthening on the scene. dollar weakness. the dollar goes down. you tell me if i'm doing this right. dollar down and oil up, stocks lot moreet paid a

money to do something much more complex than that. classes straightforward. you may dollar strength. as well as feedback loops and emerging-market credit. it is back to this, what can you predict and how much certainty do you having outcomes? the reality is there is a lot of uncertainty in the dollar. our argument is why mess with that stuff than focus on things with a high probability of success. fedn a scenario where the is not height for a few years, do you see it going lower or stabilizing? >> i think we have another side of the equation still. super easing monetary policy, bank of japan continuing policy. there is not a lot of good news elsewhere to start. we may be talking slightly weaker more than the weakening dollar. lisa: coming up in the next 20

minutes, bernie sanders fans are cheering his sweep over the weekend. he is still trailing hillary clinton's delegates by a wide margin. at 15 hundred dollars, who is buying it? lisa: home sales rebounded february. will the momentum sustain into the spring buying season? ♪

david: senator sanders scored big wins in washington, last the, and hawaii. . there is still the issue of

delegates. live with us from milwaukee, wisconsin. what is the plan going forward, mark? mark: better to win then lose. -- than lose. bernie sanders will have to win. even his advisers have gone on the record and saying the state requires a record -- a win for him to gain momentum. after that, other northeastern states. this is a state where the team is playing down expectations. i do not know if they are doing that as trickery or if they do not believe they will win. this is a state with a lot of progressive voters. she has been organizing here for a long time.

this weekend, trying to win a week in wisconsin. what do the polls say about his chances in wisconsin? mark: the clinton campaign is insistence this will be a very difficult state for her. if you look at the demographics of states were sanders and clinton have done well, this should be a good state for him. she is putting in an effort even though some of heard visors do not only this will be a state she wins. he needs momentum back. hampshire, then we moved to delegate phase, where she has a commanding lead. it will be difficult for him to catch up based on fact democrats or their delegate i proportional allocation rather than winner take all. difficult for him to come back. what he needs is momentum. he can start trying to win dates by margin so he can cut into her delegate lead. he did that a little bit this

weekend. he needs to do well. first in wisconsin and then use that momentum -- momentum to go into new york, the home state to try to get big delegate halls. then again heading toward northeastern states any hopes only to june when he is hopefully having the momentum. david: what does the political terrain look like? i'm curious how they will be received. mark: there are chump voters here. trade is a big issue throughout the region. immigration as it is through what is interesting about wisconsin is this is the first state since donald trump,

ted cruz, and john kasich. all three are looking to win. all three look at the demographic makeup of the state and make a case they could end of the popular vote winner, which is important. this is not a winner take all state for republican spirit trump clearly has strength in the state. some of the most prominent conservative talk radio hosts here are against trump and for cruise. -- four ted cruz. you will see a spirited contest with all three of them for the rest of the week here in wisconsin. >> a bit of breaking news, virgin america set to attract interest of jetblue and alaska air. we reported last week here on bloomberg news that it was in fact weighing a sale, a company that went public 18 months ago. cory johnson reached out at the time and said, they are a public withny and have a policy

mergers and acquisitions involving corporate america -- virgin america. they have received two bids, one from jet lou and one from alaska air. here, youstion mentioned new york is on the radar. bernie sanders hoping to get another debate with hillary clinton in new york. >> i like all three of the airlines. hillary clinton was desperate for a debate in hampshire and sanders agreed with one on the condition they do two debates on the road. he would like the nest want to be in new york and her campaign does not wanted to be for reasons they have not fully explained. but he would very much like to see a sequence, a win in wisconsin and then use that in a way to get attention in the media hothouse that is new york and try to beat her there. david: do not miss with all due respect tonight five :00 eastern. mark will be hosting from milwaukee, wi.

guest at 5:00 p.m. here on bloomberg television. now a look at some of the biggest stories right now. a fight with a tax revenue in the government of puerto rico. a modified tangible property tax invalid. the ruling comes as they seek new sources of revenue because of a decades long crisis. trouble for valeant, michael received a subpoena from the special committee on aging. due to testify as part of an investigation. it is the same committee that questioned executives at a hearing earlier this month. making a comeback for the first time since 2006, americans eat more red meat than they did a year before. the average american will lead about 54 pounds of beef, half of how more than 2015. beat has gotten cheaper and

protein centric diets are becoming more popular. that is your business flash. david: julie hyman has the latest. you have been looking at the virgin america news. julie: shares spiked on this. lastly, bloomberg news reported they were considering putting itself up for sale with talks with potential buyers. america, we are reporting they got takeover offers from jetblue and alaska air. could potentially get news of a deal. you can see the shares spiking right now by 11%. jetblue and alaska air, we are seeing stocked reactions from those two companies. jetblue shares also spiking up in the wake of it.

i can tell you or you can take a look at the bloomberg here that jetblue is up by about 3%. breaking news. roadt a little bump in the . as for some of the other movers we are watching today besides the breaking news that was coming out, we have been watching facebook and netflix today. both stocks are going higher. day it beginsrst shipping its virtual reality device. there is positive analyst commentary on this. also saying the increasing importance of messaging for facebook. business insider sighting numberd saying that the of titles available on netflix has fallen over 30% since

january 2014. that means lower costs for netflix. it brings the idea that netflix may charge more. in retail today, we're watching dollar general. people heard a presentation by the dollar general management last week and said the company's margins are poised to stabilize or even expand in the coming years. those shares are up 2.5%. retail broadly is doing well today. bloomberg intelligence coming out with the numbers. saying e saw an improvement overall of 2.4% in comparable basis. and sporting goods retail. david: thank you. a bit more breaking news here, reports of shots fired at the capital business center in washington, d.c. other areas of the capitol on

lockdown according to capital police in washington, d.c. fairly new building, mostly underground on the east side of the capital there. reports of shots fired at the capital business center should be to to capitol hill police. customersn some doorsteps today after four long years and $2 billion from facebook, that is coming up next. ♪

david: welcome back. oculus has done something it has never done before. two years after mark zuckerberg and nasty would buy the virtual reality technology company for the oculus rift will arrive on doorsteps today.

johnson.ow to cory oculus is also rising in terms of interest. itally shipping some units is interesting, the shipping of the device seems like my chair talking about what virtual reality will be, to be first in market with a somewhat functional advisor. they're using a next bus controller. playstation 4 will have its own virtual reality headset. only two thirds say it will be 600 -- 400 rather than the $600. in 37.5also come million playstation's out there. curious to see how this all

plays out in terms of sales of units and also in what content with which devices. lisa: what distinguishes this from anything else am a market and how much does it cost? cory: $600. 500 and nine dollars. i like exact numbers. -- $599. i like exact numbers. these and itple of is neat to be able to immerse in the moment of virtual reality and look around and participate in the entertainment as it is. we will do a special dive and look at the different ways the devices will work and what kind best on them.ks it is entirely possible entertainment is not the best used of these things.

there will not be whatever else has driven new technologies in the media. there might be uses in business and manufacturing. thank you so much. that is cory johnson. he will be hosting bloomberg west all week. right here on bloomberg television. coming up in the next hour of bloomberg markets, is the rally inequities running out of steam? recapping a bit of breaking news this hour, shots have been fired at the capital center. the capital is on lockdown according to capital police. more after the break. ♪

oh, hi! micky dolenz of the monkees here, getting ready to host the flower power cruise. (announcer) we're taking the love generation to the high seas and reliving the '60s. we'll celebrate that unbelievable era with the music that made it so special. there'll be over 40 live performances featuring eric burdon & the animals,

micky dolenz, the monkees lead singer and cruise host, the 5th dimension, the lovin' spoonful, rare earth, spencer davis, three dog night, and many more! imagine enjoying all that great music on the fabulous celebrity summit, leaving fort lauderdale and making ports of call in jamaica and the bahamas. you'll be back in the days of bellbottoms, peace signs, and so much more, with special theme parties and 20 fun-filled celebrity interactive events. cabins are filling up fast, so come on, relive the era you remember so well. the flower power cruise, february 27th, 2017. let your freak flag fly. don't miss the grooviest trip at sea. >> welcome to bloomberg markets. ♪

carroll: good afternoon. i'm in for betty liu. some headlines crossing, shots fired at the u.s. capitol visitor center court and to capital police. the capital and white house are in lockdown. one report of a shooter down. that is what we know at the hour. we will continue to monitor the situation and bring you the details as they are known. business and economic front, we did get some data on the housing sector, pending home sales in february. will momentum sustain into the spring buying season. an executive charged with 95 nine dollars in fraud. the latest details on a scheme to dupe investors and major ramifications coming right up. are crowding into the u.s. hedge fund market and that means volatility cod