>> welcome to bloomberg businessweek. >> we are inside headquarters in new york. movement takes roots in sweden. >> the former indiana governor take the budget deal to purdue university. >> and life lessons shaping the way he loves -- runs microsoft. t-rex we love that story. all ahead on bloomberg businessweek. ♪ carol: we are here with the

editor in chief of bloomberg businessweek, megan murphy. one of the most gender-neutral equal societies, and they are having a me too movement. >>ia: this is something -- this is something that is really interesting. it is still focused on individuals and bad behavior, outrage, anger. sweden is one of the most gender-neutral equal countries smaller gap and .abor force, a 4.5% wage gap but really focused on policies. how can we use this moment? criminal penalties for sex abuse, education, really meaningful real-world change. in america, sometimes we're not ofa dad taking these moments

outrage and connecting them to do anything with it for change. meia: what is fascinating to about this, there seems to be far more protections for women, they have a strange culture of silence. they see all sorts of sectors in sweden, too. >> this is a country that is modeled on, in part, because of the regressive paternity leave policy and making sure that men carry an equivalent burden of child-rearing. thate all the studies having men shoulder an equivalent part of household rearing, taking care of that, keeping women in the workforce. as we said, it has a much smaller participation rate issue and a wage issue. it talks about these issues openly, but still faces many of the challenges that we see in this article. a very male-dominated political

spectrum. industries dominated by men. place.ve the policies in carol: but where is the enforcement? >> we have these policies and we need to make sure there is accountability. that is what people are struggling, where these issues have come out. how do we change it and make people accountable? young mother of a daughter, how do we leave the next generation in a position where this isn't happening anymore? sweden is proven quite successful making real policy changes. hopes that other countries will use this as an example and look .or other things we can do julia: talk about mitch daniels. good is just sort of

business, perfect for this issue. , doingerm republican something that other people aren't. universities operated much more as a business with big athletic department, he has done two interesting things. he's trying to keep tuition cost down. he's encouraging students to graduate in three years, not f r ur. bought aversially , he believes it is fundamental to really changing this thing. and how the universes are operated. it is a fascinating look at someone who is going against the grain and against the trend. carol: i love this idea of stopping the increases in tuition. we have more from the reporter. mosttch daniels was

recently the governor of indiana and served two terms as governor. prior to that, as the most well-known as budget director of george w. bush's white house. the senior advisor to president reagan. he has had a wealth of experience, mostly in the public ,ector and national politics and to some extent, the private sector as well. but has had no experience whatsoever as an academic. in that sense, he sort of the unconventional university president. carol: he came to purdue and started shaking things up big time. as a mother who will send her kid to college in three years, i love what he did. he froze the cost of tuition. wrecks he was clear from the outset that the model that a lot of elite universities, both

public and private, have been adhering to. under pressure. and if it wasn't broken, it was going to break it some point. you have a situation where more and more students are seeking to attend these schools. they have an incentive to continue to raise tuition. it is saddling students with more and more debt that they take longer and longer to pay off. it is especially true in public atversities were you also, the same time, have seen significant declines in state funding. to even the flagship universities like university of michigan, university of virginia, university of wisconsin. he came in and said we've got to change this and get off this roller coaster. why don't we freeze tuition and reduce cost elsewhere, make up for that revenue.

maybe it will give us a competitive advantage. years later, proof is that purdue has benefited hugely from this. the university has seen a massive increase in the number of students applying to go to purdue. alumni donations. and most importantly, students are graduating with less debt. i would say it is an experiment that worked on a larger scale. this is fascinating to me because it sounds like a man with a lot of policy experience. at the state level in particular, taking it to an and intrusion and seeing how we can shake things up and make it work better. it is an intuitive response. applications have increased. i imagine a lot of people around people incan't get the door.

a lot of people were very concerned about that measure in particular. people saidrlier, that if we do this, it's going to look like we lost confidence in our product. that is something that any marketer would worry about. if you discount the price of , it signals the quality of that product somehow lower than it has been. theink he recognize that advantage of being seen as an institution that was actually taking costs seriously, concerned about affordability. education that costs less and giving students more options. .t was a risk worth taking

it is to purdue path advantage -- purdue's advantage. carol: he is pretty disruptive in terms of university. he's talked about interest-free student loans and future earnings from the student. an onlineught university, one that was taken with controversy. this year, purdue announced that they had acquired most of kaplan university. it is a for-profit chain of mostly online education properties. and basically, what this deal looks like, purdue is going to take over ownership. kaplan is going to create a new institution with a different still hasn't been fully resolved. they are not spending any money on the acquisition.

provideill continue to backend support and marketing. do a lot of the nuts and bolts. receive revenue going forward. assembly next, is the line a picture of peace or a marketing ploy? julia: this is bloomberg businessweek. ♪

carol: welcome back to bloomberg businessweek. i'm carol massar. julia: i'm julia chatterley and you can find us online at bloomberg businessweek.com. the company behind soda stream employs a multicultural staff at their israeli factory. julia: this could be a model for peace in the region. carol: daniel birnbaum is the ceo of soda stream. he's not just selling home soda making machines. at the same time, he's selling piece. -- paeace. we wanted to go to israel and talk to him. an israeli company and an interesting area that moved from the west bank. explain the location because this is important. the biggest manufacturing operation was located in the west bank.

which is in the occupied territory that i think a lot of people consider to be that israel is there it illegally. seized in the war in 1967. that became a big issue because there are some groups that are trying to boycott israel. and the fact that the soda machine was operating made them a really good target and the fact that they had scarlett johansson as their spokesperson in a big super bowl ad in 2014. explain that. >> have to back up a little bit. his background is in consumer marketing. he worked on the crest account.

the pillsbury division in israel. he ran nike. really great consumer marketing guy. one of the things he likes to do is start controversy. it's effective. it works. >> in this case, he hired scarlett johansson to do an ad for the super bowl where they took these jabs at coke and pepsi. they got a lot of attention for that. and it made them a target for these sort of pro-palestinian boycotters. i think he likes taking people on. he had a hipster david versus goliath. i think he's trying to turn the whole boycott and make that in soda stream's favor.

the company stock is way up. they bought this company, this private equity firm that hired them, for $6 million and it is now worth $1.5 billion. let's get back to the west bank. he was in charge of nike and given the opportunity to move away. peace, not focus on just a profitable business. he had a real cocktail of employees. that is really important. he comes in in 2007, and they have this plant, this old munitions factory. they said we need to start hiring palestinians. there was terrorism at the time, it was controversial. metal detectors.

basically, we will all go to the metal detectors. some people quit. but also, what he was seeing was that -- andl: palestinians israelis working together and getting along. he is saying that maybe what he's doing in the work they said his company is a way, a path to peace, if you will. much more broadly in the middle east. >> the leaders of the palestinians and leaders of the --aelis, benjamin netanyahu they are not interested in peas, just managing the conflict. they benefit from that. they are not seeing a future beyond that. he thinks private sector people like him, they need to take independent of the

political process to try to bring about peace. it is the only way this will happen. >> in terms of what he's doing, being welcoming the palestinian workers, is it endearing him to palestinian human rights groups? >> you put your factory on this , the biggest stole city in israel. , very welcome. do the workers feel about him? both the israeli and palestinian workers? >> we went to the factory. it's pretty amazing. it's amazing that a guy who runs this company, he is the ceo. it's not a huge company, revenues are like $500 million a

year. he knows all these people. he has long relationships with them. in theirnvolved personal lives, some stuff that didn't go into the story that i'm kind of sad about a break dancer, going to acting school. he is on intimate terms with all these folks and they are factory workers. bank findscentral itself juggling presidential politics. carol: this is bloomberg businessweek. ♪

julia: welcome back to bloomberg businessweek. i'm julia chatterley. i'm carol massar. you can hear us on sirius xm radio and on the radio in new york. d.c. m in washington, and 960 a.m. in the bay area. julia: and in asia on the bloomberg radio plus app. the turkish president has been pressuring his central bank not to raid borrowing costs and he talked up a small victory. president of turkey has a theory about modern inflation. keep inflation low, keep interest rates low, too. >> he has never explained where he got this idea. not completely unprecedented in latin america. it was a school called the

structuralist economist. argentine --as the the argument was developing economies in developed economies are different. there are structural issues that cause bottlenecks, and it affects supply and pushes up prices. those issues are beyond the reach of what the central bank can do to resolve them. so if you do push up interest rates, all that happens in an environment where there's a lack companiestion, the push up the cost on consumers and it is feeding inflation more. except mostasis economies have progressed beyond the state. they offset the cost by charging consumers more.

i get that. it does that apply to turkey? >> inflation is 13% now. >> it is double what the central-bank target is. an recently, they had interest rate decision and announced a 50 basis point increase in the markets are expecting four points. they went into a tailspin and people are saying, what's going on. we talked to some academics, one , itargue that in the 1980's was true that in turkey, the structural issues due to fuel very high inflation. that is no longer the case barriers wereof dismantled and turkey is now integrated with the world economy.

>> he talks about the interest rate lobby. a little conspiracy. . . . theory. >> the world wants to undermine us and he says there is this anyway, he says they are trying to damage the economy by lobbying for higher interest rates. the point is that the president leaned on the central bank and said we don't want you to hike rates. perhaps you need to control inflation or at least the markets as you need to. and you got an independent central bank.

>> it is more than an academic difference of opinion. turkey has a huge deficit. is about 5% of gdp and i think if you recall in mexico, it was around seven. when these get quite large, investors are on their toes, watching with going on. if you see this dynamic between the government of the central-bank, it could basically turn confidence in turkey around. carol: with turkey borrowing a quarter of the gdp to finance debt, you have that out there. if the economy falls into any trouble, they will deal with servicing the debt. that will be complicated. you also have elections coming up. you are doing these fun dances and i feel like they can manage a couple of different things. >> his priority is stimulating growth.

set up thewhere they special fund in order to lend companies and disperse billions of dollars already. with the turkish economy is that it is incredibly interdependent. go up, imports are going up as well. this issue with the current account is sort of chronic and kind of built-in. so they need to level games. they need to be playing to the local constituency with an actual election and satisfy the demands of international investors. julia:, china's roadmap for dominance and electric cars. carol: and a new fitness fad in india. julia: this is bloomberg fitness week. -- this is bloomberg businessweek. ♪

julia: welcome back to bloomberg businessweek. i'm julia chatterley. path satyaosoft nadella and the godfather of indian fitness. julia: all of that still ahead on bloomberg businessweek. ♪ julia: we are back with bloomberg businessweek editor in chief, talking about chinese companies always happy seeing

the government to foster, subsidize, and protect. now they are laser focused on electric vehicles. >> we spent a lot of time on this, china growing their own homegrown dominant industries. it feels like it is when they are really going out for that. china is the biggest buyer of electric vehicles. in 2015,assed the u.s. over one million expected to be sold in 2018. they have a really ambitious target of 8 million by 2025. ambitious goal, and it is really being pushed by the government. they see this as a the next industry. the key to china's dominance, they look homegrown to develop the best technology and really dominate their own field and look to export it elsewhere. i think we will see exactly the same thing. carol: we talk about tesla and elon musk disrupting the auto

sector but it might have to be a chinese company. have their homegrown companies competing in this space they're offering healthy incentives to do this. consumers are getting as much as 10% rebates. and we should mention there is a good business aspect. --na needs to have a massive there is a massive problem in the urban areas where it is not healthy. almost two full. that being said, the economic. how much they think they can move into this space, we see the requirements europe has put on in terms of electric vehicle consumption of production. very few people have the ability to produce and mass where we see these going right now in china is a place where you might be able to. volkswagen, gm, toyota. all the big guys that have billions of dollars. where do they fit here. obviously, they would love to

tap into the demand we are talking about for the chinese market. when china is intent on building coming have to wonder. >> they will have to pay to play in this market. the european and american brands have sort of a cachet factor among china's more elite and established class. that being said, this is really a free-for-all in terms of getting in there and dealing with that demand. if you will be offered this kind of incentive to not only produce but consume. , we talkink about this about elon musk all the time but they are still not producing nearly enough teslas to meet demand. this is about matching up. carol: three years is a long time in this space. >> it is a huge amount of time in this space and are no we've grappled with the amount of change in the ev with charging, battery -- it is so massive and we spend a lot of time writing about it. thel: let's talk about

story, i love a good business story. who knew them in the land of where yoga was created, they have a health and fitness problem? >> it is a fascinating story inut how the fitness craze .ndia, they become so much more rippling absy with . this is a great story about how they are tapping into this demand. julia: here is our reporter. reporter: i went to india in june to profile walker, the 84-year-old director of a company called "better fitness."

they are pioneering the gym industry in india. i went there and sort of look that how to sell the gym business to a bunch of indians who are not familiar with what it means. >> what do you mean by that? the gym, we are familiar with it in north america. >> a mainstay for many people. >> in this part of the world where this exercises and so common, it doesn't exist. in india, the business has exploded fairly recently. , theurn-of-the-century business really exploded. and as more money comes into the andtry, the boom continues a lot of upwardly mobile aspirational indians are discovering the gym membership. carol: i am someone who's done yoga for a long time. india is where it is created.

i assume everyone did yoga and is healthy. that's not the case. >> people continue to do yoga, but the idea of yoga that we have in the u.s., for example, as a form of exercise that has been commercialized -- that is something that wasn't as popular as you would expect. it has become popular on the west and some of these entrepreneurs are now taking it back and selling it back to india. it is a developing economy and has come a long way. that means there are people that have more discretionary income. they are eating more, potentially, but the downside is there is an unhealthy population and people that are more overweight. >> as the gdp has grown dramatically over the last few decades, a lot of middle-class unhealthyve developed habits that includes junk food, smoking, alcohol.

there is still a lot of malnutrition in the population. that persists. but within this upwardly mobile demographic, there has been a huge increase in obesity, heart disease, almost 10% of the population has diabetes. and the obesity rate increased between 1975 and 2014. they have come a long way from when they had to institute caloric a minimum to make sure people were eating enough. the issue is how to keep people from getting heart attacks in their mid-20's. >> some have called the godfather of indian fitness. and 84-year-old man, he exercises in nothing but bodybuilding and there is a very

warm and very eccentric. a country that hasn't seen anything like it before. it is through to his father, and they have over 200 gyms across the country and extending very rapidly. that.eally introduce american kids, for the most part, if they are lucky, it is not the case in india. >> when they open up, it is still a city of 1.2 million people. and have to do outreach

explain what cardiovascular exercise is, for example. what weight training is. a lot of people also come to this idea of exercise because their doctor tells them to. they're having heart problems in their 20's. , the 19 minutes that change the art world forever. julia: and exchanging gold in ecuador. carol: this is bloomberg businessweek. ♪

caroljulia: welcome back to blog is this week. i'm julia chatterley. carol: and i'm carol massar. you can find us on businessweek.com. julia: in the rain forest of ecuador, a minor is searching looking for gold. carol: using a combination of our technology and ancient maps. >> he is a geologist. they have had various successes before, and there is a dream for several decades to go find the lost cities of gold. carol: what are the lost cities of gold. >> it was established in the 16th century and mining a heck of a lot of gold.

the spaniards were kicked out by the local indigenous people. they send waves and waves. they are cities and really little settlements. each time, the soldiers would be -- each time the spaniards gave up, they lost control of that region. may have always sort of existed in the imagination of people. but they a also exist in maps ad

travel chronicles. they spend a lot of time in the vatican library. there are hundreds of years old documents. was already an working geologist. peru andsses in elsewhere on the globe, trying to take a bit of a sabbatical. taking an intensive course in spanish. , they areamily assessed with the maps. and they told keith barron about this map that dates back to 1574.

carol: the gold regions of peru as it was translated. >> exactly. carol: jackpot? >> these maps were not unknown. they would find a lost cities. they found other gold in ecuador. that is what the story is about, the search for one of these cities. hundreds of millions of dollars in the high-stakes artwork. she loved it and did the math on who made wide. julia: nobody knew what was

>> nobodyappen -- knew what was going to happen. people in the industry knew that it was going to sell. it was going to sell. they say i want $50 million for this work. says, nouction house matter what happens during the sale, you get your $50 million. julia: where does the auction ?ouse sit in the middle of this do they find someone to offer that price? how does it work in

terms of finding the guarantee? >> in the past, auction houses finance the guarantees. hope that be on the it doesn't sell. during the financial crisis, there are tens of millions of dollars. it was a bloodbath because they were on the hook for that. and they had to take all of this into inventory. so after the financial crisis, they stopped doing guarantees for a while. when they came back, let's outsource risk. let's find another person that place a prearranged bid. if nobody wants it, you will buy it. insurance for the sellers and insurance for the auction house. they are not on the hook and they don't take the risk anymore.

leonardo the case of that has this guarantee, multiple times that. what about the person -- >> they made a lot of money. this, wee details of are never going to find out exactly what happened. usually, the guarantor for taking on the risk. take givehe money and the seller -- if nobody else bids. , the bidding went for 19 minutes. it feltt felt -- julia: like longer. wasnd so the hammer price $400 million. extra, that is

commissioned. million on the outside that is shared between the seller and the guarantor. sellers mustd the love this. >> it gives them the product, the most desirable work that otherwise wouldn't come up. carol:, how to be a leader at an iconic company that has already had to ceos that are larger than life. onia: satya nadella bloomberg businessweek, just ahead. ♪

carol: welcome back to bloomberg businessweek. i'm carol massar. julia: i'm julia chatterley. it you can listen to us on the a 6.1 innew york, won boston, 99.1 fm in washington, 960 a.m. in the bay area. carol: and in asia on the bloomberg radio plus app. in the debrief, megan murphy sat down with microsoft ceo such a the della -- satya nadella. julia: filling the considerable shoes of bill gates and steve ballmer. this is the best part of my job. with him, i was lucky and had a clear place to start.

was fascinating to me because i highly recommend people read it. sort of detail about his life, which i don't think people really understand, and with his wife and disabled son. in his book and how he mulled himself to the executive is about empathy, putting up with the epic core of a corporate culture. particularly one that has gone .hrough that that's what i wanted to talk to him about. and when companies are expected to carry more of a voice. the immigration policy, infrastructure, ai. how do you wield that voice? how do you be that leader both internally and externally? the importance of listening, to be empathetic.

megan: he is the third ceo of microsoft. he follows bill gates and steve ballmer. that is not easy. he says that when the names were circulating as steve ballmer's replacement, none of the internal candidates were driving any enthusiasm among employees, including himself. [laughter] candidhe is incredibly about the cultural problems he felt that microsoft had when he came on. and how broken he felt the company was. in what way? that employees were not empathetic toward each other and there was a competitive culture that business units weren't aligned in a single direction. this is a company that we all think we know and we have all used office. we know there products. we know the bejeweled history and the place in american culture. thatve someone that candid

needs to reinvent that, i found that particularly moving. julia: how do you reinvent a culture with former ceos that were so pivotal in their own way in the time that they existed at microsoft? carol: kendall out an outspoken. megan: there were a lot of employees in the room. if you meet him, one tip i would give executives is, he's very unassuming. he is quite self-deprecating. to a fault. and describes himself as an average kid, got lucky. somehow ended up as ceo of microsoft. we know that's not true. interview ahen you lot of senior people, the people who know that the world does not revolve around them and actually revolves around their business and their employees -- he is not mistaken about that.

carol: just listening to what you have to say about empathy, something struck home for him. you talk about his son. ander through this tragedy this illness, it affects them. megan: his son is disabled, and they talked about the moment where they found out. i really respect -- his wife was

the one that said to him, it's not about us. it is about making this journey as productive and involved. it really shaped the mindset of nothing has happened to me. it is my job to go out there and try to make the world a better place in the way that i do through microsoft. but it is not about me. carol: it's available on newsstands now. julia: an online and the mobile app. we saved the best for last in this one. carol: we both love the story that megan murphy did with satya nadella. he talks about empathy in the work lace, empathy and life. it's really important. julia: the importance of empathy in leadership. a man with pretty big shoes to fill as far as microsoft is confirmed -- concerned. more bloomberg television begins now.

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