carol: welcome to "bloomberg businessweek." i am carol massar. jason: and i am jason kelly. we are joining your from bloomberg headquarters here in new york. carol: this week, the ceo of lloyd's of london response to our investigation into how women are treated inside the firm. jason: he tells us how they will stamp out sexual harassment. carol: plus, how microsoft plans

to beat google and appl. jason: and on the cover, a herd of unicorns about to go public. carol: and by unicorns, we are talking about startups valued at $1 billion or more. jason: check out this chart that shows the total value of ipo issuance for stocks listed in the united states. what a peek we are about to hit. carol: we are talking about unicorns like uber, interest, so many different ipo's, we are near the highest, record levels for ipo's. markets editor michael regan writes about this and says it could be a signal that the bull market is ending. michael: the fed surprised people by basically in their projections for rate increases for the rest of the year, they basically are projecting no more rate increases. people think the fed knows something we don't know, and, you know, something bad is coming. not too long after that, the three-month, 10-year yield curve

inverted. >> we should go from friday. michael: yeah. basically that is when rates on three-month treasury is are higher than rates on 10-year treasuries, which, without getting into all the bond market maps -- it's a worrisome sign. carol: it is not the way it is supposed to be in terms of the yield curve, right? michael: right. you are supposed to get compensated for taking on the longer period of risk. if you are investing in a bond that matures in 10 years, the idea is you get paid more. when those yields come down, it means people are buying them heavily, and the thinking is that people are worried about the near-term, about either recession or the deflationary environment, something that will drive bond prices higher in and of those yields lower. they are willing to get out of riskier assets in the pile into that longer data bond. carol: and you know this so well

-- is the equity market right or does the bond market know something? michael: the eternal struggle, who knows something and who was right? the cover and the story really discusses these unicorns, all the big startups that are finally, after years of anticipation, coming to the public market. lyft being a good example, and its competitor, uber, waiting in the wings. that will be the big ipo of the year. but there's a bunch of others, obviously. airbnb is expected. the list goes on and on. you can read the story for the list. i'm sure everyone knows what they are. carol: pinterest all of a sudden came out, you mentioned airbnb, postmates, slack. we talked about it in 2018, this could be a big year for ipo's. michael: and it is. and the projections are written in pencil and being erased and

revised higher, to a point that renaissance capital is a firm that specializes in ipo research, and they have an etf that tracks ipo's. maybe $100 billion in ipo's this year, which would put it -- it f not a record, close to a record pace. that much issuance of new stock makes people nervous for a variety of reasons, one of them being someone knows something we don't know. carol: like why is everybody running to go public? michael: right, right. and there's often a lot of conspiracy theory, for lack of a better word, that sleeps through sweeps through the market. the bankers must be whispering in the ears, this is it, this is the time to sell, because the market is looking like it is getting top-heavy. as the bond yields inversion shows, there could be a recession sometime in the not-too-distant future, the stock market rally has gone on

for a decade, it is the longest we have seen, depending on how you measure it. the economic expansion is almost unprecedented at this point. everyone will tell you, well, bull markets, economic expansions, they don't die of old age -- carol: i wish i had a nickel for every time. [laughter] michael: right. but it still makes you wonder. so all of these companies picking this moment in time to pass into the public stock market is making people nervous. that a top is coming. jason: and, carol, speaking of unicorns going public, later in the program, we will hear from an investor in uber and airbnb, the ceo of general atlantic. carol: looking forward to that. up next, the american who may have a big influence, and how much we make it to see of robert mueller's report. we have got a hint for everybody. it is the same american the report is about. plus the apps that helped alexandria ocasio-cortez

, aoc. carol: this is "bloomberg businessweek." ♪

carol: welcome back to "bloomberg businessweek." i am carol massar. jason: and i am jason keller. y. join carol and me for for "bloomberg businessweek" every day, and check up on our daily show by subscribing to our podcast. carol: and of course you can find us online at businessweek.com and on our mobile app. in the politics session, william attorney general william barr needs to decide how much of

robert mueller's report to release. jason: president trump may have a big say. here is politics editor jillian glickman. trumpism a really interesting position, on the one hand, he was the subject of a 22-month investigation but now he is the only one who gets to decide what parts of that are in are not covered by executive privilege. he got up in front of reporters on monday and said he doesn't care as long as the attorney general is ok, but there are plenty of reasons why even beyond anything in particular he is worried about having been set said or discovered, they would not want some of those things to come out. jay sekulow was also talking to reporters about how, if they released his interview questions, that would set a difficult president for future presidents.

>> as you say, trump ultimately decides -- do you have a sense of where justice is leaning? you have an interesting cast of characters, the attorney general who was appointed after he dismissed jeff sessions, who the president made his displeasure well-known, rod rosenstein who is hanging around for a certain amount of time, ultimately the president, as they say, is the decider, but what sort of advice do you think he is going to be getting? jillian: from his own lawyers, they probably would not want that much of what they provided to come out as far as from a . as from a justice standpoint, part of the job is to make sure that executive privilege is protected. on the other hand, barr has said repeatedly that he wants to make as much of the report public as possible, of course that "as possible" is a big, effective if in this scenario, because there are plenty of things he won't be able to disclose because of regulations covering

secrecy around grand jury proceedings, other ongoing investigations. he has been vocal about -- people are calling on him to release the full report, or at least a redacted version, he says he does not intend to do that. it has been hard to pin down barr on what we can expect. from the justice department on this. >> one of the interesting elements around attorney general wrote this long memo around this notion about what he's not of this investigation, specifically around the question of obstruction of justice, so we know a little bit about what his thinking was before. is there any sense that says changed, or could that be called into account by folks on the other end up on capitol hill as to what he should and shouldn't do? jillian: right. that memo was going to make it a lot harder for him to appease democrats on this question.

he hasn't said anything other than what was in his sunday memo, but he will be coming before some house members and appropriations subcommittee on april 9 for a previously scheduled hearing about his departmental budget. that hearing is likely not just going to be about his budget. he is likely to get questions about what, if anything, congress will be able to see. we should know more at that point. >> and do you have any sense of what the timing is when some larger group of people will see some larger version of this report? at this point, we should remind people, very few people have seen the whole enchilada. jillian: exactly. barr has said he intends to take weeks, not months, to complete his review of the report, to see what he could potentially release. whether he decides to release that to congress or congress decides to release it to the public -- all of those questions are still out there.

carol: and online at businessweek.com, the organizing app that helped elect alexandra ocasio-cortez. we are talking about aoc. jason: aoc in the. deed. the app is called reach, and it offers a new way for canvassing supporters. it is about to go mainstream. carol: josh green has the story. josh: reach is a new piece of political tech, and organizing app that evolved organically from alexandra ocasio cortez's campaign. in the political world, the most interesting thing about aoc, as she is known, was that her campaign was a marvel of grassroots organizing. nobody had ever heard of our, no one imagined a socialist could knock off a longtime incumbent

democrat, who was probably going to be the next speaker of the house, and out of nowhere, she organized the fourth district in queens in the bronx, essentially taking that seat away from joe crowley. one of the ways she did that was a couple volunteers on her campaign built a mobile organizing app to go out and get a registered, young socialist working class minorities who are so plentiful in her district in and were the key to her victory. now they are taking that tack and have started a company called reach, that will make this available more broadly. carol: take a step back. i'm curious what these guys were thinking. what was it that wasn't working about grassroots campaigning today that they knew they needed something different to make it more effective? josh: right. anybody who comes from the tech world from the world of politics -- the first thing they think is this is completely antiquated and makes no sense. the two people that started the

company realized that this isn't a very smart way of doing things, especially not as a way of reaching the kind of people aoc wanted to reach, people who were outside the political system, who may not have voted in the last election but could be turned on to this exciting, charismatic new candidate. they took the voter list and uploaded to an app that was , searchable, and that allowed them to go to the places where her potential voters actually congregated, places like bars and coffee shops and farmers markets and subway platforms, and lo and behold, when primary day came around, she had the votes to knock off the incumbent in what was undoubtedly the biggest upset of the 2018 cycle. carol: was it just a case of finding more people, loading up more people into the voter base? what was it that really made the difference? josh: what made the difference is the mobility, that essentially politics as it was being conducted until 2018 was based on the lifestyle that people don't live anymore. knocking on your door and trying

to catch you at home and calling you on your landline phone and hoping you will talk to a stranger. who picks up their phone anymore? a lot of people don't even have a landline anymore. what this did was take the process of canvassing and modernize it for our new era, especially to match the lifestyles of the people in that district. democrats traditionally relied on young people and minorities as two very important components of their electorate. barack obama was able to mobilize these people, but hillary, by and large, was not, because these groups of people are difficult to reach. one of the things democrats generally jos -- not just democc socialists, but mainstream democrats excited and interested in the technology is that they managed to reach and activate the voters, voters that every candidate would like to be able to reach and went over. carol: coming up next, the

loophole etf depend on. jason: and a couple investing titans. general atlantic ceo bill four. carolford. carol: this is "bloomberg businessweek." ♪

jason: back to "bloomberg welcome back to "bloomberg businessweek." i am jason kelly. carol: and i am carol massar. you can also listen to us on the radio on sirius xm channel 119 and on a 11.30, 99.1 fm in washington, d.c. jason: a.m. 960 in the bay area, on dab digital, and through the bloomberg business and. so, carol, how banks are helping etf's avoid big tax bills. carol: it's a fascinating story on the short-term trades, called heartbeats. you can see how these traits have spikes recently. jason: it is a massive jump up.

carol: alex and rachel evans explain. alex: in september, we saw this enormous inflow of cash into a technology fund, followed by an outflow. this is something we had been watching for for a while. we heard about this big index rebalancing that was going to take place in september, as it got reject. we were looking to for this and when we saw the inflow it was really large, more than 3 billion, and it got us thinking about what these traits are all about. we have seen these trades in the past that typically happen with an index rebalancing, the etf getting rid of the stocks it no longer needs. carol: a normal part of market activity. rachel: of very large trade. this is the thing that zach picked up on.

zach: there's a totally innocent explanation, which is this is how the fund needs to get rid of a few stocks, but that is actually not what's really going on. if they wanted to do that, they would just wait until markets closed and they could sell the stocks that needed to leave and buy the new ones. or they could swap with an investment banker. but instead, two days ahead of time, they are having a bank put new stock into the fund, become a big investor in the fund, 14% of the fund increases in size, and the stock that the bank is putting in includes the stock they need to get rid of two days later, so why would they be doing that? it just seems kind of illogical on its face. carol: why would they be doing that?

zach: because if they sell the stock, or swap it with an investment bank -- this is like facebook stock, they need to get rid of that has appreciated, a big, built-in gain -- if they sell it, they have to report that gain to the irs, and their investors have to pay tax on it. but if an investor in the fund wants to withdraw from the fund, and they give that stock away to the investor as compensation for them leaving, there is no tax due. they have a bank come in and be an investor for 48 hours, and that's enough to make the tax bill disappear. carol: and it is legal. rachel: it is a quirk of how etf's are structured, they have in creation and redemption which , which means the way they work when the fund expands that someone delivers a portfolio, they get shares back in return, and the money swells. if they want to take their money out of the fund, they get the etf shares and get a bunch of

stocks back. what i thought was interesting, what this means from a tax perspective. it is very much a de facto way the fund works, but the tech tax side was interesting. carol: let's go back to the tax side. it goes back to a tax law change in 1969. take us back there. what happened? before the world of etf's. zach: yes, 24 years before the first etf even existed. back then, the only thing congress was talking about was mutual funds, because they were the only kinds of funds that were regulated by this part of the tax law. congress was cracking down on tax dodging among insurance companies, and in order to do that, they said -- insurance companies in the 1960's, a big bull market, they had all these investments that had gone way up . and so they said rather than pay tax on those stocks, to share them, we will just do share buybacks, and instead of cash, we will give you appreciated stocks. you don't have to pay tax and neither do we. congress got wind of that and

said no more. that is illegal now. but we will exempt mutual fund companies, for reasons they never really explained. that didn't matter much, because mutual fund companies don't really do that, they never have. they hadn't before and they haven't since. carol: mutual fund companies are different from etf's, in terms of how they work, which is why they wouldn't take advantage. zach: right. they traded generally directly with retail investors, and investor opens an account and , and when they close that, they want cash, they don't want a 500 stocks that they have to go so. and so mutual funds don't really use this loophole very often of withdrawing investors, this pile of securities. carol: when i read this, i was thinking about the coordination that is necessary to get the bank that buys into the fund a few days ahead of when the selling is planned. so tell me about that coordination.

rachel: the understanding that we have is that a few days before the balance, before the stocks leave the fund, the etf manager or the trading desk will pick up the phone and calls a few different banks. carol: who do they call? rachel: goldman sachs, for example, bank of america merrill lynch, credit suisse. these things are what we call authorized participants. this gives them a special, privileged role within the ecosystem. it means they are the only people that will create and redeem etf shares. given that the etf manager needs to have this big creation coming in, so they can have a big creation going out and wash out all of their taxes, they call of these authorized banks in say, hey, we have this big index, rebound coming up. would you guys mind doing us a favor? the bank will look into the economics and ultimately make a decision based on the relationship they have. carol: because they don't get a lot of fees, it's really about the relationship.

fees.they get zero by law, they can't get paid a commission by the etf manager for the service they are providing, which costs them the cost of their capital to be tied up, $3 billion for two days, the cost that it takes to hedge, in and the bank is not going to take any risk. they do want to be exposed to the market. they will hedge their exposure 100%. so they are incurring these small but nonzero costs of doing these transactions. carol: because? rachel: it is all about the relationship. if you are a bank and you are doing business with blackrock or vanguard, you want to continue to do business with vanguard or blackrock, and you don't want them going to another bank. carol: taylor has another look at these heartbeat trades, and it is pretty obvious when you see them. >> it is. taylor: [laughs]

it is. let me show you one, this is the technology select fund. one of the etf's we are hearing about in this story last september, somehow they got a bank or an investor to come in, $3.6 billion to avoid taxes on capital gains, just to see them withdraw two days later. the index fund is about to change, getting to do that, you can avoid the capital gains tax after their shares more than doubled. carol: you can see why it has been standing out to our reporters and why they wanted to look into it. taylor: exactly. carol: fascinating. thank you so much. jason: up next, how lloyd's of london plans to curb its culture and an sexual harassment at the firm. carol: the ceo responds to our "bloomberg businessweek" report. ♪

jason: welcome back to "bloomberg businessweek." i'm jason kelly. carol: i'm carol massar. still ahead in this week's program, but very difficult task of beating microsoft when it comes to video games. pg'sn: plus, heavyweight t efforts to improve diversity. carol: we begin with lloyd's of london. last week, bloomberg reported on

testimony from women in the insurance industry about a deep-seated industry of sexual misconduct at lloyds. jason: the firm has unveiled a package of measures to stamp out sexual misconduct. carol: we have the exclusive interview. last year, i was very honored to take on the position at this was london, and not the lloyd's that i want to be part of. it's not the lloyd's my colleagues want to be part of either. it is simply not acceptable in

this day and age that any woman -- or man -- should not feel safe. you run through the actions we have announced. one of them is to understand through an independent culture survey what we are doing well, but importantly, what we -- what more we can do. we have to ensure everybody, whether it is a woman or a man, should feel safe any time of day feeling secure doing anything to do with a lloyd's market. i'm determined that will be the case. it is one thing to police behavior what people are at work, but a lot of incidents bloomberg reported did not happen within the building itself. john: you are right. and lloyd's operates globally. we will impose our own sanctions. if anyone is found to have acted inappropriately, we will be incredibly decisive, and as i said yesterday, that could include lifetime bans. we are being as clear as we can we will not accept this behavior. nejra: critics might say that this is crisis management or

closing the door after the horses have bolted. can you bring a culture that your predecessor, inga beale, with all her work on diversity, did not manage to do in five years? john: i think she did a fantastic job bringing the market forward. i think the inclusion pledge, the changes of the market has been incredibly significant. everyone i have spoken to has been shattered by the article. i have no doubt that everyone wants to redouble their efforts to ensure that these events cannot occur. nejra: now, it's one thing to regulate behavior. it's quite another to regulate thoughts. what will you do to change the attitudes that lead to sexual misconduct? john: i think two things, i would say. first, we are doing mandatory training for all of higher staff , so they can understand and look out for actions that are inappropriate, that are undertaken by others. how do they intervene in a situation where someone is feeling uncomfortable? so if you are, like, the experienced bystander who is able to step into the situation

and help. the other is to understand what is working, what is working well , and ensure that those lessons are learned by everyone across our business. nejra: what sort of response have you gotten when talking to industry executives? i know you had this crisis meeting on monday. john: what has encouraged me is none of the participants in our marketplace, and let's remember there's almost 100 insurance companies operating at lloyd's and 300 brokerage firms. every single one of those entities is lined up behind what i said yesterday without hesitation. i think everyone felt very, very disappointed to read the news. and determine to stand behind the actions. nejra: hmm. bloomberg spoke to 18 women with something like 300 years of combined experience between them. when bloomberg spoke to these women, some of them said that they had gone to their hr department and actually been persuaded to stay silent. do the hr systems actually need

to change in the u.k. insurance industry? john: in our hr systems, we take any form of complaint seriously. i heard that. one of the things i said we would do was set up an independently-managed and confidential multiaccess point that anyone could go to if they feel they have a complaint or a grievance. so at the very least, it can give them advice, or even more strongly than that, it can run a process with these people feel will they be heard. it cannot be right that they people feel the way they feel as reported to bloomberg. jason: coming up, his own firm started an investigation of the college admissions scandal. carol: plus, what is life like for transgender americans? we hear a first-hand account. jason: this is "bloomberg businessweek." ♪

jason: welcome back to "bloomberg businessweek."

i'm jason kelly. carol: and i'm carol massar. join us for "bloomberg businessweek" every day on the radio from 2:00 to 5:00 wall street time. you can also check out our daily show. check out our podcast on itunes, soundcloud, and bloomberg.com. jason: and check us out on bloomberg.com and through our mobile app. carol: this week, leaders in business, politics, and academics gathered at the bloomberg equality summit. jason: that is where i sat down tpg capital chief jon winkelried. we started talking about the recent college admissions scandal, which saw charges brought against a former partner. jon: a couple weeks ago when the news first broke, as you can imagine, this was pretty shocking. this is something that we had no knowledge off or had no idea it was happening. so, any time something like this happens, it sort of takes your breath away for a minute.

but we reacted as you described. we try to react in a pretty focused way. one of the things we thought was really important to do was make sure that we were communicating. so we went out to all of our stakeholders, and by the way, that is externally and also internally, because this is important thing internally as well with all of our people. or people, number one, were very supportive. they obviously understood the context. bill was involved in this scheme on a personal basis. so, our investors, number one were very supportive. our investors understand what we are trying to be part of. there is our impact franchise , which obviously has a lot to do with why we are here today. but naturally, they have a lot of questions. they have a lot of questions.

so, what we have committed to our investors is that we have undertaken an investigation internally to make sure that none of the things that built was engaged in were in any way, shape, or form leading into the business. to our that int investors, so we are working on that. jason: help us understand this in the broader context of the work that you are doing in tpg. this is something personally you have personally taken on since you arrived a few years ago. what work are you involved in internally? jon: i think, just the broader context of why i feel it is so important, and why we feel it is so important -- it's not just a question of -- diversity is one aspect office. i like to view it in a much broader context. i think in the world that we

live in today, being the few do fiduciary investing in the world we want to be a part of, it is important have an expression of , in my view, to have an expression of values. what do you stand for as a company? diversity is one part of it. i like to start more from the perspective -- what are your values as an organization? how do you think about, just in the normal course of your investing strategies, what do you think of what we are doing, how we are doing it? i start with inclusivity and that bleeds into the whole idea of diversity. are we an organization where people feel like a really want to be part of this kind of

living, breathing organism that is a firm? i feel like, when i got to the firm, we were in the beginning stages of getting our heads around that. in the past couple years in particular, i think this whole concept of value orientation, what do you stand for, what are you trying to accomplish, i think that has accelerated in a big way. not just at tpg, just generally in the market. carol: in our equality issue, "bloomberg businessweek" talked to transgender americans about the widespread discrimination they face in the workplace. jason: the supreme court may soon decide whether they are entitled to protections. carol: sierra club manager thatous lady davis is one we interviewed. her journey.bout

precious: it was hard going up being gender queer, especially growing up in nebraska, an environment where i was not exposed to diversity. i was scolded and disciplined for displaying feminine tendencies and wanting to exist in an identity that was not normative. carol: how did you know you were gay? because people were asking you in the fourth grade. how do you know, this is what i am? precious: i am writing a book. my book is titled "i've always been me." in fourth grade and people were asking, are you gay, i didn't know. i was just being me, and i think that is a fact for thousands of queer kids in the world. they are just being who they authentically are. i liked playing with girl toys. i liked playing with barbie's.

i liked playing dress-up. i did not want to be a little boy, but there was no education at that time surrounding gender identity or identifying as transgender or being gender nonconforming. and so i just showed up in the world without definition. carol: yeah. that must have been hard for you. precious: yeah, it was definitely a struggle. i was definitely bullied. i was definitely harassed. it was hard to be so strong in my personality, in who i was without having any figure to of figure to identify it with. i was just being me. it was not until recent years we that we started to have this massive conversation around gender and transgender identity. and so it was a struggle until i

finally understood when i took a took an lbege and i gt literature course we have a great history, a great history of trans and non-gender conflict conforming people. i understood there was a history i have been a part of. carol: we talked to nine individuals, trans workers that each talked about their personal experiences, including you and , and they talked about support and not getting support in what could be better, whether it is health care, government involvement, education, what . what could be better, from your own experience? precious: we need affirming health care. i think that means people need

service providers who understands their unique needs without triggering them, without disrespecting them. we need basic rights. and people deserve to serve in the military. trans people deserve to exist in our society and pursue what ever desire or dream may have. you know, there is this onslaught from the trump administration against transgender people, and i think it is about recognizing our humanity and not zing us and dehumanizing us, and i think it is about showing us in our humanity, that we are mothers, brothers, sisters, colleagues and a multitude of things. , just onere not, like thing. it is more than just recognizing our humanity. jason: up next, why when private equity tighten is not giving up on hq 2. why these that new york needs to lure amazon back. my conversation with bill ford. carol: and while microsoft may

remain king of video games, no matter what google and apple try to do. jason: this is bloomberg. ♪

carol: welcome back to "bloomberg businessweek." i'm carol massar. you can also listen to us on the radio, sirius xm. carol: i am 960 in the bay area. in london, on dab digital and of course on the bloomberg business app. bill ford is one of the biggest names in private equity. he is the ceo of general atlantic. jason: he joined me for the exclusive interview bloomberg television. we talked about the troubled ipo market and amazon and hq 2. bill: i think 2019 is setting up to be the most exciting ipo year since 2012 for a couple reasons. they will introduce investors and you have on the crowd

source, i highly anticipated next generation software companies. they introduced investors to the social media space. when you have a very constructive equity market, combined with modern volatility, the market is not too hot, not too cold, really creates the best conditions for a good ipo market. -- moderate volatility, the vix 215, the market is not too hot, not too cold, it really creates the best conditions for a good ipo market. we have seen this works, and we

have a nice condition for the year. jason: have you worry about ied about valuations in this goldilocks market? bill: it makes our job more challenging. the key for us is actually discerning -- can companies emerge as market leaders? when you get that right, history tells us you can get your investment returns even if you are paying a full valuation. where you get travel, companies have relatively small markets. you are being asked to pay. jason: you are also involved in the partnership for new york city. i believe that you guys have been very involved, especially on the back end, of that decision not to come to does on the back end of the decision of amazon not to come to new york city. bill: we have really tried to turn around amazon's decision. we are looking to see if we can turn this around.

we are worried that it sends a negative signal to business globally about doing business here in new york. new york had great momentum in the tax base. you think about it, facebook has a campus here. google has a campus here. the space had momentum, and i think getting amazon would only have distinguished new york as a leader in technology. also media. new york is a great media hub. it would be another catalyst for development. we hope we are able to turn it around, and if we are unable to come up we still want to send a really strong signal to the new york business community that they want to operate here, build a business here. jason: got to talk some hoops. you are in fifth place right now, in good company. back in the day, i believe you

rode unc all the way. this year you have duke. a lot of people have duke. how are you feeling? bill: i feel great. it's one of my favorite times of the year. brackets for a cause -- there's deep contest this year and is a great feeling. congratulations, like anderson, forgetting 16 of the sweet report team got 15 out of 16 we 16. are hanging on in fifth place. this is a super competitive field this year. we just feel coach k, probably the best college basketball player in zion williamnson, hard to go against. that got a good chance to win. carol: google and amazon both want to be netflix for games. jason: this just sums up how they can market is. look at smartphones and tablets. their dominating. carol: not small numbers at all.

gary. is reporter gerry gary: people who use xbox, playstation, pc's to play these large expensive games that take years hundreds of millions of dollars to make, the technological change allows those expensive games to be streamed, just like shows and tv on netflix. you will not need a console or pc. that lets the tech giants, microsoft, google, maybe amazon to jump into the industry and really disrupt it. jason: gerrit, when people think about the games, they think about what you're are talking about. what you planning on? when is the next big game coming

on? they are like movie releases. but this whole notion of the hardware piece, that is radical, right? gerrit: yes, we have had hardware consoles for decades. they became popular in america in the 1980's and playstation following in the 2000's. you have had a new console come out every 4, 5, 6, 7 years and it costing you between $400 and $500, and most people upgrade. some people love xbox. some people love playstation. those companies have gotten exclusive deals with games makers to bring you to the console, because you want to play halo or you want to play red dead redemption 2. at this point, if we will be streaming games, that really shakes it all out. jason: how does it shake up the videogame makers, because they s -- we talkock about them every day, whether it

is activision, blizzard, or e.a. or take two, for that matter. how does it change the equation? gerrit: like you said, in some cases movie releases. some cases, bigger than movie in some cases, bigger than movie releases. red dead redemption 2 made more , over $700 million, than the latest "avengers" movie made in its opening weekend. this is a big money production. it takes years, hundreds of millions of dollars. hundreds of workers. the with economics of the industry has worked is hoping people will shell out some new dollars or $80 when the game comes forward. at this point, those games makers, ubisoft, electronic arts, take two, they have the power because they have content. hbo has not gone away in the netflix world. if they have that premium content, they hold a lot of power. when these streaming services were announced, google last week, and apple this

they were announced without any deals with major game makers. there is no sense whether those games will be available, and if those big tech giants want them to be available, they will have to pay up to get them. carol: "bloomberg businessweek" is available on newsstands now. jason: and also on businessweek.com and on our mobile app. what is your must-read? carol: all of those products coming to the market -- we do not know whether to believe what the fed is saying, what the bond market is saying, with the credit market is saying, we are trying to figure it out. jason: that came up in my conversation with bill ford. all the is why he is so focused and what it means for the overall market, on the private and public side. i have to say i love gerrit de vynck on the videogames. what is going on with eea and take two. but this way that people are

considering the games, how they play them, it will change them. carol: more stories over the weekend. jason: and check out our podcast on itunes, soundcloud, and bloomberg.com. carol: more bloomberg television starts right now. ♪ you.

all of you. how you live, what you love. that's what inspired us to create america's most advanced internet. internet that puts you in charge. that protects what's important. it handles everything, and reaches everywhere. this is beyond wifi, this is xfi. simple. easy. awesome. xfinity, the future of awesome.

>> the following is an independently produced program. the views and opinions expressed on reflect limited lp, its employees or producers. >> either wondered how much the government has access to your social media account. i will show you how their next new status update will help them. coffee by day and cocktails by night. the latest tech might make you show your id the next time you k-cup. buy a cake top -- you do learn a new fantastic software that finds of worthless noodles and turns them into a work of art. i will also tell you how this application will help architecture and urban pla