now the defenses are against nationstates. the threat profile has changed dramatically. cyber security, like other kinds of security, is asymmetrical. the defender has to be correct 100% of the time, but the attack only has to work once. defense is always going to be bigger as a challenge than attack. defense has to get much more sophisticated. we as an industry are still in the process of catching up to that. emily: marc andreessen, cofounder of andreessen horowitz. bloomberg lp is the parent company of bloomberg tv and is an investor in andreessen horowitz. there is a bubble in the private sector. and we have a special focus on virtual reality innovators. we are looking at one company transporting you to a virtual world. ♪ emily: and now to the cloud. another strong quarter as it pushes further into europe. i sat down with workday ceo aneel bhusri. aneel: the marketplace for financials is about twice the size of the hr market. we are excited about the prospects. emily: on your earnings calls, your ceo said you could be profitable. why focus on growth in this current cl

the cyber threats come from a range ofa range of actors including nationstates which falls in the two broad categories, those with highly sophisticated cyber programs, and those with lesser technical capabilities with more nefarious intent such as iran and north korea but who are also much more aggressive and unpredictable. then there are non- nationstate entities, criminals motivated by profit, hackers, extremists motivated by ideology. profit motivated cyber criminals we will i hung loosely networked online cyber marketplaces referred to as the cyber underground or dark web that provided a forum for the merchandising and elicit tool services and infrastructure. so on personal information and financial data. the most significant financial cyber criminal threats come from a relatively small subset of actors, facilitators command criminal forms. terrorist groups will continue to experiment with hacking which could serve as the foundation for developing market basket for these. cyber. cyber espionage, criminal and terrorist entities all undermine data confidentiality. denialdenial of se

estimate >> the biggest risk i would say, two things one is we are not used to defending against nationstates. 20 years ago, defenses were against teenage kids. 10 years ago there were against organized crime, now it's against nationstates. the threat profile is change dramatically. cyber security, like other kinds of security is very asymmetrical. the defender has to be correct 100% of the time, but the attack on the needs to work once. defenses are was going to be bigger challenge than attack. we as an industry or so on the process of catching up to that. mark andries and andreessen horowitz. we should mention that bloomberg lp is an investor in andreessen horowitz. coming up, maybe he is but someone else tells me there is a bubble in the private tech market. this week we have a special focus on virtual-reality innovators. coming up, an in-depth look at one company. ♪ emily: and now to the cloud, worked a reporting another strong quarter as it pushes further into europe. i sent him at this he had to check in on a reading from valuations and consolidation to the progress it's making in its >

use theand nationstates spectrum of capability to generate insight into the world around them. that does not mean that the use ive andr for manipulat destructive purposes is not acceptable. we have to work our way on how people develop that in a much more refined way. >> i have to say, sir, many of these issues that you raise are significant. not really in the realm of the people sitting here. we can try to speak to them. on your concern about conflating or not distinguishing between cyber threats or economic purposes, you are quite right. it's not that we don't make that distinction, but the adversaries, notably the chinese, do not. they don't see a difference at purpose forltimate which they extract data from us. i just want to make that distinction. withis a personal view -- respect to espionage purposes, i --ld caution that we think we should think before we throw rocks. as you correctly and appropriately allude, very complex policy issues. >> if i could drill down once more very narrowly -- on the latter issue, are there any rules of the road when it comes to foreign intel

i am comfortable that we will achieve this over time in the nationstate arena, but it is the state actors that complicate this to me and will make it difficult. >> what we are attached. how do we impose cost? do we respond? can we look at other ways to respond in an appropriate manner with sanctions. what would you look at? >> what we talked about previously is we want to make sure we don't look at this more broadly and think across the breadth of capabilities and the advantages and bring it all to bear as we're looking at options as to what we do and that it is a case-by-case basis. there is no single one-size-fits-all answer, but more broadly than just cyber. >> correct. would you agree? do you see a variety of options out they're? and wouldn't it be more beneficial as a country to be able to have a policy that is a public policy on what those options could be and the consequences that would be felt when we are attacked? >> absolutely. and andabsolutely. and that is what i say about a broad policy we will respond in a time,a time, place, and manner of our own choosing. there is an asymm

those are two of the main nationstate actors we worry about. and then finally, iran, we will be training a lot of our on iran's compliance with the nuclear agreement. that will be the next type rarity. host tom and i want to leave on the two things you raised. move on to iran and some of the cyber issues. , wementioned at the outset work from an old assumption in the intelligence community that most of what you dealt with if not forn secret periodire 25 or 30 year that you would see at the bottom of a classification stamp but most of that. the dni got around to declassifying presidential daily briefs lyndon johnson received early in the vietnam war. that is the old model. the cia went through a procedure, annual review of the white house that basically said, is this operation, is the data we are getting out of this operation, this effort worth what we're getting if it got disclosed tomorrow morning on "the new york of times" or "the washington post"? the nsa never went through that process until post-snowden time. tell us, go one more beat abou

how do we build a construct that works for both nationstates and nonstate actors? one of the challenges inherent in cyber is the fact that you are dealing -- unlike the nuclear world where you are dealing with a handful of actors , you are dealing with a much greater number of factors, many of whom are not nationstates and have no interest in sustaining a status quo. if you look at isis and other groups, they want to tear the status quo down. they are not interested instability -- in stability. >> this is a promising area with other nationstates. it will not be the whole solution. if there are states like russia or china willing to have this discussion, it is a profitable discussion. along with the idea of deterrence. we are asymmetrically vulnerable in this war. we are the most wired country on earth. i appreciate your testimony and the work you're doing. you've testified that you had a variety of reactions from the telecoms about retention levels. what is the shortest you are hearing? admiral rogers: i want to say something on the order of 12-18 months. >> that i

you had nationstates becoming individual groups, and even al qaeda, as mike said this morning, is now an institution and a doomsday cold which is incredibly effective as using methods that nobody could dream r then someone like charlie manson. we're crossroads of a lot of things that are happening in the world, not just in america, in a generation of you people that are looking at institutions in a completely different way. to be that george w. bush happened to be presiding over this, which did not make his presidency any easier. one of the fundamental and mr. standings that we went into iraq on was that iraq was a country. it is an agreement european powers of hundred years ago that made no sense is a country. he unrooted all of that and an analyst forces that nobody had any idea where is horrible as they were there. there was an enormous technological revolution going on around the world. the bush people just happened to be there at the time. diday that the bush people not understand technology is not really fair. that would be like saying william sheikh square -- shakespeare did no

>> the failure of the nationstate of syria and isis and the mega-drought that created the symptoms, orr the conditions of extreme poverty that has led now to the rise of isis. so, the pandemic in west africa. there are many places where we are behind the turning radius of the crisis. we are left with only military responses. >> i'm not asking you to repudiate donald trump as a person. i do not think you are as good friends with him as other people. i'm trying to understand what separates you from the others who feel this is beyond the pale? senator cruz: i'm not going to engage in the media's game of bashing another republican candidate. i'm just not going to do it. mark: some people say you want to make sure he does get into the race so you can win the support he has. is this a political population? senator cruz: i'm not going to go into the gutter with personal attacks. let me be clear -- i think policy distinctions are fair game. i will talk about differences when it comes to amnesty or common core or marriage. that is what is supposed to be the bread and butter of politics, but i'm

these cyber threats, from a range of cyber actors, including nationstates, which fall into two broadategories -- those with highly sophisticated cyber programs, mostly russia and china, and those with lesser technical capabilities, but more nefarious intent, such as iran and north korea. with respect to non-nationstate entities, criminals motivated by profit, hackers, or extremists motivated by ideology are included in this threat. profit motivated cyber committal's rely on loosely networked online marketplaces, often referred to as the dark web, that provide a forum for the merchandising of illicit tools, services, and infrastructure, and stolen personal information and financial data. the largest threats come from a relatively small subset of actors, facilitators, and criminal forum. terrorist groups will continue to experiment with hacking, which can serve as the basis of more dangerous attacks. cyber espionage undermines the confidentiality. cyber threats and acotrs, particularly criminal and terrorist tities undermine data confidentiality. denial of service operations and data d

but other nationstates. we are the only app where users are anonymous, truly anonymous.ng app, it makes it harder for us to grow. for human rights activist to be anonymous, it is so important when you are fighting dictators. we have activist fighting dictators right now. stephen: do you have a next step? that needcompanies this kind of security technology would be approaching you. >> one of the areas is to secure financial transactions that run on fsl, which any good hacker knows there are one million will hundreds. you think about a lot of the tasks every year whether your heart monitor or your skateboarding. these are bluetooth connections unencrypted. stephen: or ashley madison. nico sell: ashley madison. it was amazing to see a $1 billion company go to zero dollars. it is not the only. the business model will succeed that does not hold all of the data. stephen: she will hold your hand and educate you on the risks. stephen engle. angie: we have breaking news right now. checking stocks. just started trading and tokyo. check out the shares, followed by the most in a yea

since you do not have a nationstate that is a danger to us as much as a diffuse movement of individuals, anyone of home could harm people. you have to have this huge catch. security policy will change erratically and is already changing dramatically. finally, of course, we go back to what we have been talking about, the nature of technology changing, changing the way in inch you talk about policy the way that you talk about policy having to change, the way you formulate privacy having to change. one of the things that we notice in washington is that laws and regulations up with technology area the patriot act and nsa surveillance, keeping up with how fast technology grows. also, members of congress are not always that tech savvy. lindsey graham saying that he has never sent an e-mail, these are u.s. senators. ed: well, it is not a requirement to be a twitter expert to be a senator. [laughter] ron: i was not a great student -- ed: i was not a great student. i was in the upper two thirds of my graduating class because i'm sure the bottom floor. i was always a leader. i read six newspapers

we do understand nationstates use the spectrum of capability to generate insight into the world around them. that does not mean that the use of cyber for manipulative and destructive purposes is not acceptable. we have to work our way on how people develop that in a much more refined way. >> i have to say, sir, many of these issues that you raise are significant. and not reallyes in the realm of the people sitting here. we can try to speak to them. on your concern about conflating or not distinguishing between cyber threats or economic purposes, you are quite right. it's not that we don't make that distinction, but the adversaries, notably the chinese, do not. they don't see a difference at all in the ultimate purpose for which they extract data from us. i just want to make that distinction. this is a personal view -- with respect to espionage purposes, i would caution that we think -- we should think before we throw rocks. as you correctly and appropriately allude, very complex policy issues. >> if i could drill down once more very narrowly -- on the latter issue, are there any rules

it's like going out a nationstate. fourth, let's use the united states air force to soften up the target. i would not say would never use american troops. if isis continues to win, we may have to continue to do it, but that should not be our first resort. wish a letter the allies in -- we should let the allies in their neighborhood help. the last part is they need a president who knows when he gives his word, he is going to keep it. this president said if assad uses chemical weapons, we will take him out. then when he did and killed 230,000 of his own people, the president said never mind. allies cannot count on you and adversaries don't fear you. i guarantee one thing if i am president -- that allies will know we are friends and adversaries will know the limits of my patients. josh: let's talk about immigration. and how that also plays international security. gov. christie: there are four steps you need to take to secure the border. first is to build fencing or walling in appropriate laces. i do not favor a wall acros

other nationstates. we are the only application where users are truly anonymous.s it a little tougher for us to grow, because we are not downloading your address book and spamming your friends. but for human rights activists to be anonymous is so important when you are fighting dictators. we have activists in over 46 countries. reporter: do you have a next step as this grows? 10 million users, nearly. i'm sure a company needs secure technology that would be approaching you. guest: one of the areas is to secure financial transactions that right now run on at excel. any good hacker knows, there are millions of holes in ssl. habit on attacks a devcon every year, whether it is your heart monitor or keyboard. these are bluetooth connections that are unencrypted. reporter: r ashley madison. amazing toink it was be a billion dollar company go to zero. i don't think it'll be the first one. this is why this is a assist huddle -- business model that i think will succeed. reporter: he will hold your hand and educate you on the risk, whether it is on wheels are on the web. st

the political institutions reflect that and therefore in order for you to create the nation state nationstate with the republican government you're going to have to change the definition of what the representation mean. and it's great to have to be larger. they just think it's represented by one representative in the house which they did in 1788 that's not really representation. and so someone like ted cruz thinks yes i get this and any cluster of the political power in a faraway place is almost inherently tyrannical. >> it is well reasoned paranoia. >> it is heralded as truth and patriotism. >> let me go back because you mentioned the word republic. the words are public and democracy have different meanings at this juncture. >> we don't become a democracy. >> democracy is an epitaph that means demagoguery behavior. we have yet to see the creation of the comment. the constitution is a pre- democratic document. it sounded on a popular basis than the popular opinion has to be filtered through several leaders of the liberation because that is the difference between democracy and the public there

offers opportunities for thinking about aspects of global governance and the interrelationship of nationstates and society and thinking about controlling risks like the cigarette. when you ask about the wall and ethical issues, over 140 countries have signed and ratified the framework convention for tobacco control. the principal major country that hasn't is the u.s. as we all know. the bush administration hasn't forwarded the treaty for ratification to our senate. these are the kinds of issues we need to be talking about in order to think of new strategies to better human health and their complicated because they are often very powerful industrial and economic interests on the other side. >> i'm going to preface my question by saying thank you. as a professional tobacco control researcher and a scientist, i find a general history about this field to be really useful in framing a more specific question i ask and i really enjoyed dr. proctor's book. i want to ask you who you hope reads this book and have your publisher will be marketing it. is it academic, general? mr. brandt: i have some ambit

not just technology, not just the media but the existence of the nationstate itself began to change inhe fundamental beliefs of the people trained in the past 40 or 50 years became onboard during the bush administration which had nothing to do with george w. bush himself for the people he hired. there was not a whole lot they can do about it except play catch up. >> i go back to the point about discipline. you always want in the campaign or white house. you can't tell 100 stories. i'm sure the administration this week want to tell a story of the nuclear iran negotiations going on. a massive plane crash yesterday, you obviously have the bombing that tape place last night. all of a sudden whenever the original game plan was a different track. the hardest part is you see everybody sitting here with iphone like this and there's a temptation to go respond and as a press person or strategist, what have you, to have the discipline to say i got this text from julie who wants an answer right now. i sent a text answering her question and i would totally move away from my agenda to her agenda. th

they are the real power in the world today, not the nationstate as the -- it is a global corporationsif you want to look at the ultimate of this free market catastrophe that the world is facing at the moment, go to the shantytowns on the fringes of so many big cities around the world. look at those people -- migrants dying and the mediterranean. why are they there? why are they dying? i will take this, it is when the world bank arrives and tells them to privatize all public services, to sell off state only at, to make inequality paragon of virtue. that is what drives people away into poverty. i will conclude with this thought -- think about the world you want to live in. do you want the dog be the dog or do you want is all to care for each other, supported each other, and eliminate poverty and injustice? a different world is possible. thank you. amy: that was jeremy corbyn. by the way, his argument won. but we have this breaking news, and we would like tariq ali to respond. malcolm turnbull is set to become australia's tim prime minister after beating tony abbott by 54 votes to 44 in

. >> one of the things that preceded the failure of the nationstate of syria, the rise of isis, was theffect of climate change and the mega-drought that affected that region that created a humanitarian crisis that created the symptoms -- or rather, the conditions of extreme poverty that is led now to the rise of isil and extreme violence. amy: he was derided by conservatives for that statement. republican party chair called it absurd that some climate experts have said his comments are not so far-fetched. can you explain what you meant of the connection between isis and climate change? >> sure. it was not only climate activist that backed me up, but some of our best minds and analyst in the defense department. there was a tremendous drought that hit syria a number of years ago that drove people off arms into cities, their government could not take care of the basic needs of families in those conditions. civil war rose up as a result of protests and repression and then that led to the civil war and then the vacuum to lead to isis. these are because getting effects that happen in a world

but other nationstates. where users are truly anonymous which makes it tougher for us to grow because we are not downloading your address book and spamming your friends. human rights activists, to be anonymous is important when you are fighting dictators and we activists fighting dictators. stephen: the next step is this gross, i am sure that companies -- as this rose, i am sure that companies will be approaching you. is that we are hoping to secure financial transactions which right now in a million holes, hundreds of holes. but you also think of the attacks that happened every year, your heart monitor or your skateboard. these are bluetooth connections. stephen: or ashley madison. amazing toate was see a billion-dollar company go to zero. i do not think it is the first one we will see. that is why the business model will that will succeed does not hold all of the data. hold yourut she will hand and educate you on the risks, on her skateboard or on the web. kyushu, theges from southernmost island of japan,

resistance, of course, but i think this is the role of the commission to put on the table -- then nationstatesreact according to their national interest or populism or in coming elections. are seeing is not so much a refugee crisis or an immigration crisis. i think it is a collective action program. and the fact is that every state, nation wants to go its own way. even if this is not the problem that could be handled by a single member state, not even germany. that is the usual drama tha everybody can see what is the rationale of acting collectively. but then, national interest or national upcoming elections gets vested interest, get into the way. but i think the commission has to go forward to stem the -- extend the values of the thepean union and leave responsibility to the member states. can you remember that years ago the commissioner made a proposal for a, immigration policy? he was rejected enthusiastically by all member states, even the ones now calling for european action. so, unfortunately, this collective action, a program which is typical in europe on deepissues, is, is a problem. i

response in the case of the opm cyber espionage case, and what types of information gathering by nationstates, governments are legitimate, and what types are not? >> well, first, i am the operational commander command all three of the questions to just asked a much broader than that. >> in terms of the three things we define, the bottom line is clearly we are working our way through that. the parameters we want to use to define an act of war, my going in position is to build on the framework we have developed over time which is a good departure, a broad framework. the 2nd question was about -- my note to myself. >> proportional response. >> again, what are the parameters? is it the intent, is it scaled? is it you can do espionage at some level, but if you trip some magic threshold, 20 million records, 10 million records, some skill components of this. we are clearly still trying to work our way through that issue command there is no one-size-fits-all answer. i think there is recognition which is what has driven this broad discussion. could youcould you repeat again the types of information? >

it's not like going after a nationstate. and let's use the air force to soften up the targets. wouldn't say i would never use american troops. we may have to so they cannot come here but that should not be our first resort. we should let the allies on the ground help them to fix the problem and the last part is the need a president who knows when he gives his word, he's going to keep it. when he did use chemical weapons, the president said never mind. allies cannot count on you and the enemies don't fear you. if i'm president come allies will know america is their friend. host: take a couple minutes to talk about your plan. governer christie: there are four steps you need to take to secure the border. first is to build fencing or wallowing in appropriate places. i'm not a guy who favors a wall across the border. it doesn't make sense and it never seen a wall or fence that has deterred a human being. areas particular, you ing. fencing or wall and what i said about agents on the border. and we need to use surveillance in the most remote parts of the border to send information bac

of the sense of having a stake in the region coalition to reengage in the region as an important nationstate player in the region. >> and in your recent visit digit talk about some of this? the incursions in the neighboring countries? >> and we have a different.of view from the iranians. we see these things differently. hamas different, the such to the situation in bahrain, yemen, and that is, perhaps, not surprising. the fact that i was in tehran talking to the senior players about how we see these things differently i think is a step forward. and again, we have to hope that as iran reading gauges with the world just as a debit nuclear weapons, it will start to make decisions based upon its assessment of its own national interest to modify some of its behavior. it will not happen overnight and it has been doing so for reasons of international self-interest, not for reasons of regional altruism but actually responsible nations acting in their national, enlightened self-interest within the international rules is a game that we can all play, even when we don't agree with the policy objective o

and you can easily see how this technology might be terribly misused by other nationstates. in terms of surveillance but perhaps even more pointedly in terms of a platform for lethal fire. mr. sanger: what is the doingigence community together this intel? what we had to do was rely on partner agencies to do this and so you always run into the potential problem. the bigger challenge is digital. it is hard to -- back in the old movies, someone can show on a mask and sneak into a country, maybe they speak a foreign language. nowadays between your cell phone device that anybody can track with enough money and enough technology, with -- whether you are on facebook or twitter, everyone has visual dust. -- digital dust. just the whole kind of big picture problem, how do you even identify and meet and develop new human intelligence sources is becoming more and more difficult. i think you hit it where we are going to have to will things -- these relationships with allies and partners to try to leverage contacts within countries and people who have access into very difficult places li

muslim world or something similar to what happened in the great wars of religion in europe when nationstates to involve -- began to evolve. religion was tearing things apart. vonnie: we saw yesterday in a bloomberg poll that people are generally unhappy with the political system in the united states. but you say they do not need to be and there is a better way. what is that? john: for all the despair about politics, you have to imagine in end willpeople in the start to change government. it seems impossible for me to google inat you have the headlines, with the same revolutions that happened in the private sector, that they will not happen in the public sector. france computed with britain, competed with germany. we kept on pushing each other forward -- france competed with britain, competed with germany. we kept pushing each other forward. the west has always really been good at government. now we face it with china. tom: the pageantry we see this morning as president obama and president xi hold a joint press conference in the rose garden. viaake you there live bloomberg television and radi