Transcripts For BLOOMBERG In The Loop With Betty Liu 20140113

Will be harder. Before we continue, lets bring everyone up to speed with the days agenda. You want to play t pay close attention to what is happening in detroit. The north American Auto show will open its stores. Matt miller is there talking to Industry Leaders like alan mulally and bill ford. He will be a with us in just a bit. 12 40, there will be a speech on the economic outlook. At 2 00, the treasury opens it looks on how the government did in december with Monthly Budget statements. Speaking of budgets, i have my mind on something. Bank budgets or balance sheet. The biggest banks will report earnings. Jpmorgan will kick it off tomorrow morning. Ian, perhaps this is a good place to start the conversation. Things are kind of stuck. The u. S. Economy is picking up speed. That seems to suggest that banks will have a good year in 2014. The curve is beginning to steep in. They can bore short and lend long. I feel better. There is no question. Every ceo i have spoken to says that, despite the dysfunction in washington, they will double down on the economy. I think that the budget deal, as limited as it was, is getting us through 2014 without having to worry about a Government Shutdown or debt crisis. The simple fact that washington dysfunction goes back into a traditional we have midterm elections coming up if you are an american shareholder, that has to make you reasonably happy. I look at the banks now. It is a tough environment. Hopefully that will move higher. The economy is picking up speed. Inflation is on the horizon. They should make more in terms of spread. Assuming that they keep making loads and the economy is growing. It is challenging. You are in a regulatory environment. These banks have been forced in a utility mode. Goldman sachs and Morgan Stanley the traditional investment banks, are not able to use their voice as impressively as they could before. You could make the argument that we have also heard that they are cutting their mortgage because of the offsetting. What is the demand going to be like . Yes, they have been forced into utility mode. There is no such thing as concentrating on wall street. If estimates are right, the only inc. That will report a lower profit in 2014 is goldman sachs. If you take the six biggest banks, it will be the most profitable year ever. Doesnt feel like the kind of environment the legal fees are up to 18 billion. Allocating the legal fees and bad mortgages what worries me is you graduate from college and grad school. It used to be that your brass ring job was goldman sachs. That is not true anymore. They are not getting the talent that they used to. Theyre not offering the money that they used to. They are telling junior bankers to take the weekend off. They say you only need to work two weekends, not all four weekends. I see that as saying we are not going to pay you. They are not saying that in chinese enterprises. Theyre saying that i goldman. If you are hustling to get into harvard, you are used to grind get out. They save you do not want the working grads any longer. They come in and do two years of service, then they decamped for a private equity firm. You are investing all of this money in training. I am watching breaking news. Centauri is buying jim beam for 16 billion. That is a 25 premium. It will be the worlds Third Largest spirit company. That will be coming from japan. It will help to open up the overseas expansion, even though there is not a lot of cost synergy for suntory. I think that they will be much more consistent. Really . Is that the outcome . There is no way they will that allow that level. And analyst pointed out, the reason this yield to place now is a strong yen and low interest rate. 25 premium. Ay a theres not a lot of cost synergy. Whiskey. The report on japanese whiskey. You are not a japanese whiskey drinker . I will be now. They are sitting on a lot of cash. They will feel good in 2014. They will pay higher wages. They understand that the japanese market is not where they want put all that cash. This is the key. We could see more Japanese Companies do this crossborder m a. They need to find more customers. They are not going to china. We have another company. Wendys. A huge jump in the free market. Their outlook is on the high end. I could make . 30 per share. Comcast is up 3. 5 . Wendys has been terrible. They had a hard time staying relevant and remodeling. They are investing this new blood and remodeling their stores. 25 of their stores this year. This is a positive indication. They were feeling tired. When was the last time you ate at wendys . I am looking at you. This is the issue. You are dealing with low margins. The dollar menu drives a lot of sales. You are also looking like at the trends to organic. And the trend the pressure on minimum wage. It will not pass, but it will squeeze them. Were looking at a nine percent increase for the nation. Regardless of what Congress Ends up doing. What is the Pricing Power here . When was the last time you were in wendys . Never. It has been a while. That may be why it is so dated. If you had to choose between the fast food chains, where would you eat . Chipotle. Why is that . Three quarters of my staff has one scary day. You know who is eating their everyday . Chris christie. I was watching the weekend shows and i saw a number of republicans gracing weekend programs. They were trying to defend Chris Christie. The big scandal and concern is that this bridge issue in fort lee, new jersey take a look at what they were saying. Im a great admirer of governor christie. I thought he handled himself well in that press conference. Reality is he said he did not realize. He said he did not know. I did not think it was credible. He would not make this blanket denial a must that is not true. He stood there for 111 minutes in an open dialogue with the press. Heres my question. Lets think about this. We are all business journalists. You are a businessman. Perspective,ment if you are ceo of the company and your cfo pulls shenanigans, do they do that because they feel empowered because of the leadership role that you have set . How much response ability should you be taking . Problem withis politicians. How many things have gone wrong in the Obama Administration . This is the fault of the international community. There is not an international community. He is the president. The buck stops with him. Chris christie does not want to do that. No one wants to do that. It is not democrat versus republican. Press conference went well. I was never a believer that he would get the nomination. There is no way, what he would have to go through. He does not play in the rest of the country. We do not reflect the rest of the country. Furthermore, what i found incredible is that, if i get an email from the Port Authority if i am the Port Authority, that email confuses me. I have gotten emails like that before. Theres a pattern. If i am Chris Christie i am not saying he did not hear about it. The first time he sees that, he is not stupid. He is thinking there must have been a lot of stuff like this going on. That never came up in his press conference. I am not buying it. It is sad. America, there is more sons billy placed on the ceo in terms of leadership. With the ceo be up to get away with the things that we see our politicians get away with . Yes. They get away with it all the time. Passing the buck. Yeah. Look at jpmorgan. Jamie dimon. Jeff dailey has been thrown under the bus. It is the same kind of idea. That goes back to the point youre making. You establish a culture and set the bank. The culture often is what guides people to do the things that they do. There clearly was an atmosphere within the chief Investment Office that had the london whale trading. If you read the emails, it is shocking but people said and did. Clearly, it felt normal. There was one that stood out at me from the New York Times. Frank wrote about this topic. He said that without enough you and we, politicians him up against a world that is spelled with an eye. I. That is isolation. He just kept saying me. It upset me. I am so sorry, it affected you. I am so sorry that we had a problem. I still like him. I do not know what happened. I do not understand why the New York Times continues to use them for other things. I do agree. He was a fantastic food reviewer. The point is, he actually would have written a decent review on it. At no point did we see the Chris Christie he went to fort lee and met with the mayor. Did he actually going talk to the people . That wouldve been the populist thing to do. That is not where his interest why right now. He is all about Chris Christie. A lot of folks in the media, left and right, or hoping that this would be the excitement. You watch morning joe and Chris Scarborough has this lovefest for Chris Christie. That is what this is about. One person who is not what he used to be. Hurting his chances for 2016. We have the whole gang here. Were talking about Golden Globes next. You probably saw it last night. Everybody tuned in for the return of live television. What it means for business. Enjoy it while it lasts netflix. You will not feel so good when snap chat is appear except thing best drama. Some breaking news out of aig. They are hiring. They plan to add 600 advisers over the next five years. This is part of the effort to after thee brand Insurance Company paid its bailout from 2008. They are adding more and a lease. They already sell life insurance. They are trading lower in the free market following the news. Trish, back to you. You are watching in the loop. I am trish regan with Erik Schatzker and alix steel. Target was not the only retailer hacked during the holidays. We probably all heard about that. 70 Million People affected. It turns out Neiman Marcus was another victim. There is news that there may be many more. Yes. The news broke on friday. We learned more details about what happened. About one million Customer Credit and debit cards have been compromised. Lets put that into perspective. Targets numbers are huge. Neiman marcus is numbers pale in comparison to others in recent years. You may remember what happened bytjx, people were driving and using wifi to steal numbers. Target has 70 million, as many as 110,000. 110 million. The list goes on. And, as a new englander, it is hannaford. I am canadian. When i go back to canada, they are using smart cards. We are not. Why . Dont smartcards everywhere you go . We are americans. We do not need them. Were the largest economy in the world, we do them our way. You have a good point. It is safer and more secure. You have to enter your pin. The pin to complete a transaction. My real issue with this is not that the company with hacked. That could happen to anyone. We have to learn, did they take the necessary precautions to guard against this. Not only where they hacked, they did not tell their customers. Waited until a security blogger contacted them and financial journalist contacted them. They were asking questions. Then they came out and said that this happened. Same thing with Neiman Marcus. You can go back to 2007, when they were previously hacked. They waited two whole years before telling customers. If i am a customer a target, now i have to worry about my information being stolen and the company not telling me. I dont blame them. Sales were down. They had to lower their earnings guide. With all of the hacking in china. When did we learn about that . Least the one thing you can say about target is the brand is used to being attacked. I feel like a lot of companies are reactive, rather than proactive. What is the incentive to fix it . The ceo of ronan analytics toby that preventative action cost five 5 to 10 . The burden of responsibility lies on the card issuer. Justice Department Data backed that up. 40 of people find out because they are informed by the bank. Only in seven percent of the cases today find out look at amazon and ups. Ostensibly, the blame is on ups. Amazon wants to ensure that they have a Good Relationship with their clients. They offer discounts. It does not matter where the legal claim is. If you have people feeling vulnerable wheres the Consumer Protection agency . Shouldnt we be protecting people somehow . How is it that it is the bank issuers responsibility . They cannot stop target from being hacked. But they cant tell you that you will tell your customers. I do not want to play doubles at cricket, but it appears that the company was having struggles getting their hands around the fraud to find out what happens. They found out about it in middecember. Forensic investigators determined that they had been breached. They still do not know how many people were affected. What do you say . Raise the alarm bells by making a Public Disclosure that we have been hacked, but we have no idea i wouldve wanted to know. You want a nanny state. I actually closed my bank account. Part of it is because i shopped at target. I would like to have thought it didnt exist. You took a precautionary measure . My husband and i were going to combine things anyway. This was an impetus to do it. It is terrifying. I am using cash next time i go. We should go back to a cash economy. Bitcoin. Waiting for someone to say that. When we come back, talking about fancy cars. The Detroit Auto Show may make you want to drive. In exclusive when we come back. You are watching in the loop. I am erik with trish regan and alix steel. Our guest host is ian bremmer. It is 26 minutes after the hour. That means we are on the markets. For a look at futures, were looking at a down open. The s p 500 future is down. The dow is up by 19. Traders will not be making a big jump. Companies earnings probably climbed 4. 5 on average. Investors are probably waiting to see how things shake out. A couple of stocks that we are watching, suntory and jim beam. Suntory will buy them for 16 billion. You see that they are unchanged. Cristina alesci is with us with the latest. The worlds thirdlargest spirits company. What are the details . This signifies that we are entering into an m a a market with more of a risk appetite. This is a japanese giant. People do not have realized cash do not realize do not realize how big they are. You cannot go a day without running into a suntory product. That is how big they are. Cost are not many synergies, but they are hoping to bring the popular brands in the u. S. To the emerging asian market. People are beginning to experiment with spirits. Maybe we have run out of steam in the u. S. They can get some growth in the asia market. It is not about bringing their products here, but bringing u. S. Project elsewhere. That is exactly what it is. We may see them jump into the u. S. Market with products that were popular in japan. Japanese whiskey is very serious. I do not know if you have had it come up that it is delicious. Not just the beverage, but the whole culture around whiskey drinking in japan there is something about japanese confidence that is wrapped up in this deal. Yes. Where has it been for the past 20 years . A comes from the fact that the yen is so strong. That is what makes this deal work. The currency fluctuation risk is not there. It has always been a risky deal from a crossborder standpoint. They feel good because of the yen. Year,least for the next the bank of japan is one of the least independent. It will keepuns money pumping money. Theyre saying this is a time to look out. Thatat is interesting is Japanese Companies historically do not like to take on extreme amounts of debt. They are actually taking advantage of the fact that you have low Interest Rates to do these deals. That is what it is playing into this deal as well. I loved lost in translation. Lets turn to the Detroit Auto Show. Matt miller is in the motor city. Great interviews with the biggest players. That includes a bill ford. He focused on how the future is all about tech. It is all about technology. We have all talked about automatic driving. The pieces that will make vehicle to vehicle communication and vehicle to infrastructure communication were working on all that. I was an exclusive interview with 04. Matt miller is joining us from the Detroit Auto Show. Matt . Yes. I am with mark ruiz, global head of product. Two days left until your promotion. I saw you introducing this new truck, the gmc canyon. It looks awesome. Thank you. One of the coolest things about your products is that you will offer mobile hotspots. As we drive around, we do not have telephone signal and we can use the hotspot from the car. That is pretty cool. We have been in the business of onstar for 17 years. To put the size of its hype into the cart to enable people to do things like what you said, which is create a mobile hotspot and use your technology, it is a great thing. It is a great thing for everybody in the car. From Voice Recognition and being able to voice commands and use we cloud and use onstar, really take care of our customers in terms of bag deployment and safety. Simple things like my kids having flat tires. That type of 4g is a huge enabler for us. I have been in onstar user for a long time. They give major actions. Lets talk about the truck. You are the First American company to go back into this midsize truck segment. It is owned by toyota. What do you think . Why make that decision when people can buy a sierra or so over auto . Why would they take the smaller truck . We are about 200 pounds lighter than in 150. If you look at where we are today, what happens on the future, we do not want to offer a tear to truck. That is what a lot of people try to make work. That is different from what were trying to do today. As you saw last night with the canyon, we have a fourcylinder with 193 horsepower. We also have a turbo diesel, fourcylinder. We have not announced the worst power. Horse power. It will be the quietest in its segment. We have powertrain lineups that we are not putting in the big trucks. It is a different value equation and different capability equation. It is a different operational cost equation. People will really be interested and it will cost less. Not Everyone Needs a fullsized silverado or sierra. You guys have put out more sports car than anybody else. The corvette was the car of the year last year. You have the camaro coming out. All of these are huge competitors. Winning your competition against ford. Youre pulling the marquette of european why leave that market . There has been a lot written about this. To state the obvious, it was tough to separate volvo and chevrolet. We want to concentrate on making the global brand successful there. The amount of sports cars that we are bringing in, based on prior models, are not totally worldclass cars. That was a tough market for us. Today, what were showing with 7, as north american car of the year, we have worldclass sports cars. We do not have to have a whole brand set up to offer these. That is the approach. And the cadillac you have a lot of sports cars. I am looking forward to checking this out. And the z28. Mark reuss, head of global development. Thank you very much. He is president of north america. One thing to add, the ceo of fiat and chrysler Just Announced with his chairman that he will stick around for three more years. He will be at the helm. It would be premature if he were to leave. Ian bremmer is here with me. Ian, lets make this international. That is your specialty. , the chinese automaker backed by warren buffett, wants to bring its cars to north america. North American Companies are trying to break into the chinese market. Who will win this battle . No one will win for the time being. Chinese brands will have a hard time getting up there. There is no recognition in the u. S. Segment for them. They will build from scratch. American corporations trying to going to china they are the largest consumers of automobiles in the world. The gmsame time, you saw took their headquarters out of shanghai and moved to singapore. The intellectual property is getting ripped off. There is master it massive pilfering. This is a market where neither side is winning. Is it about revenue or branding . To say you will have a chinese car in the u. S. , is that what it is about . Sort of. Americans, do they want to buy chinese cars . We already buy chinese cars. Volvo. They are owned by the chinese. They do not hit you over the head with the marketing. No one ever has. They will not gain anything by saying this is a chinese car. In china, they can say this is an american car and it has an upside. I do not know if it has the same impact here. My parents have a toyota and they say their next car will be american. I have never heard my mom say anything like that before. She is 70. Fords deliveries in china are up 49 . Theyre beating out toyota in the World Largest car market. Not a surprise that toyota is having problems. The japanese segment has been hit across the board in china. That ifthe surprises you think about the interior of the country, those are folks that are developing cash and the ability to buy. For them, the chinese brand does not have the same negative. It does not mean no quality. If you are in shanghai or beijing, the western brand means a lot more. Note, i amgramming thinking about alan mulally who doesnt . Alan mulally is up the Detroit Auto Show. He will be talking to matt miller coming up in the next hour. January 20, that is the day that iran will be scheduled to freeze its nuclear program. That is part of the deal announced in november. There was much criticism. Alix steel will tell us about what is not in the deal. I feel like i am channeling tom keene. The standout of what was not in the deal is twofold. One, it avoided the conversation about what to do about centrifuge. You have centrifuges for enriched uranium. That is one concern. The other is the plutonium facility. Iran is connecting r d. They are still allowed to work on the plutonium facility. Is this bogus . What is good . Such a negative nelly. These are two big issues that have not been addressed. Youre right. Theres the other side, which is that the iranians are not getting much. They are still well over one Million Barrels to date. The economy is getting screwed down. This was a very big deal compared to nothing. The very fact that they shook hands they had a phone call, that was a big deal. Having the diplomats meet and having a foreign minister the fact that they came to an interim deal and are talking seriously about having a comprehensive deal over the works,of 2014 if it what they agreed to initially, with where we need to get in 2014 with sanctions removed and i ran back into the community is a big left. Does this prove that sanctions work . Yes. It shows that the United States, if it puts its effort into it, can bring together an international coalition. Now, it might work. If it does not, it will be hard to maintain the sanctions over a long time. Channing imports china imports doubled. Before this import deal went through. 7 billion they got. No. They increased by Something Like 85,000 barrels for china and taiwan. Theyre still under the one million per month one million per day on average. The iranians are not winning. The economy is getting destroyed. Their currency is in freefall. The economy shrunk by six percent last year. More this year. Congress will say that, the saudis will say that talking about congress, lets get your take on bob gates. He is the former defense secretary under george w. Bush and president obama. He has an upcoming book. Heres what he said. About president obama ordering more troops, he says he was shocked. He never heard of president frame a decision as a direct order. It is completely unnecessary. Defense, i never issued an order or heard a commander do so. It demonstrated the unfamiliarity of obama and biden with American Military culture. What do you think . I think he comes across as more of a republican than he had thought. He is certainly very frustrated and angry. He said that this stuff was too important to wait. He took criticism that he shouldve waited. Hard to wait when you know that every dollar you could make is going down. Your relevance is going down. People forget about you. You have to balance that. He is not getting younger. I like bill gates. He is a smart guy and has done Great Service for the american people. He is also a military man and a statesman. He was frustrated by a firstterm senator who did not care about foreign policy. He did not support gatess view on afghanistan. I understand that. Why would you . Given where afghanistan has gone. 82 of americans opposed it last week. Than ever inr history. I get it, but i do not think gates has done himself a service. Im going to read it. Coming up, we will talk about something that is not the political. The Golden Globes. Actually, maybe it is political. It is a tv award show. Big numbers, why they matter, ratings. We will talk about that next. Gravity is nominated for best film. [applause] it is the story of how George Clooney would rather float away into space and spend one more minute with a woman his own age. That cracked me up. I watched 10 minutes of the whole thing. This is the one part that made me laugh. Amy poehler and tina fey were perfection. You looking at Different Reasons why they are catching advertisers attention. Ratings. It is simple. It is amazing when you look at the numbers. These award shows are delivering right now. Really impressive. Live really matters. The emmys and Golden Globes up last year. The Academy Awards not as well. Offerof these live events huge numbers. I want to know, ian bremmer, did you watch the sound of music with kerry underwood. I would rather watch you guys than the Golden Globes. You are not part of the 18. 5 Million People who tuned in. They tuned in for the sound of music. It is not about dvr. It is about watching live. You cannot dvr a live show. People want a live event. You can if your apartment is a bubble and you do not care what people say. If you participate in a en you need toth watch live. I guess you are happy living in a bubble. There were sports on yesterday. That is the other example. You know who knows this . Dick clark productions. Guggenheim is getting into the bidding war. Cbs is paying 350 million. It is all sports. They will do 14 award shows this year. I want to put this out there. Theres going to be an award for the sexiest man of the year. There will be an actual chauffeur that . You want us to start voting now . Start picking out your outfits. Dont you get award showed out . How many of those do you need . I think it is a very valid point. Right now, what theyre finding is that they are delivering. You can sll watch breaking bad or house of cards on netflix. You have the luxury of your own time. These things, if you want be part of the conversation and social media, you have to do it then. It feels more like a defensive maneuver than an offense of maneuver. It is like sequels at the cinema. They do sequels because they do not have a better idea. They do award shows because they do not have a better idea. The offense of maneuver is being played by annette sick netflix. If you look at the president ial debates, it was part of a live conversation. You look at breaking news, like the way you are covering the bombings at the boston marathon. The nation was involved in the conversation. The coverage is very different. You had folks online that were actually breaking the news. It was covered and you had to be watching television. A few years before, you couldve caught it in the morning. It is changing. Ian, thank you for joining me. Ian bremmer is the founder of the eurasia group. We will be right back. It is 56 past the hour, which means we are on the markets. Im scarlet fu. Im keeping an eye on lululemon. Shares were expected to plunge. It would be the lowest price since 2012. Theyre cutting sales and profit forecasts. They have seen traffic and sales trends decelerate meaningfully. Were keeping the eye on that stock. We certainly are. Tuples and then i had an interesting conversation. It sparked a lot of these concerns. Stay in the loop marijuana is legal in two states. Stay tuned. 30 minutes to the opening bell, this is in the loop with Betty Liu Yuriko account him begins right now. Heres what were working on this morning. Alan mulally is in the loop. He is live from the Detroit Auto Show. He will tell us what is in store for the redesign of some of its most crucial models. We will also talk to the ceo of the marijuana vending machine maker. Shares have shot skyhigh. A major acquisition in the liquor market. A 16 billion deal that will suntory burgers, wendys released forecasts that were well ahead of analyst estimates. Of alix steel joins us with more. What is going on . Eat beer andld whiskey for breakfast at the same time you would not be working here. Earnings on the highend were coming and . 36 per share. It is also going to double more than the restaurant revamps. Him analysts have been looking for 25 from some of their restaurants to remodel the business. Also, sales are a big deal. When days had a really hard time staying relevant in this fast food war. Beenic declines have happening for years despite any kind of recent strain. Nevertheless, there are a lot of challenges. Menus primping those margins the come up to 15 of sales. You also have that Consumer Trend for organic. Him it may be good for chipotle but not so great for customers at wendy. Wagelso have the middle debate, regardless of what Congress Says overall. About the other Fast Food Company that we have talked quite a bit about, yum brands . , they had some major issues over in china. 60 of the revenue comes from china. There have been some food safety concerns about chicken. They also were concerned about antibiotics that the chinese didnt use. Also it is a general economics at economic showdown in china. Watching the segment very closely. We have been trying they have been trying to do purse away trying to diversify away from chicken. The question is will they continue to build up in china despite the struggling results . Alix steel on wendys. A here is a look at other company headlines. The german automaker increased 7. 5 last year. Spending up ons new models. Of and after a difficult 2013, toms 2013, things seems be looking up for lulu lemon. Last year the companys ceo resigned following the recall of those seethrough yoga pants. The move is an effort to build stability. Ralph whitworth will be renominated as part of that plan. Have you noticed this, marijuana stock has been hot lately thanks to the legalization of recreational pot use in colorado. Investors are piling into related to marijuana shares good one stock has seen a lot of action, they produce vending machines for recreational marijuana. Their stock surged 85 on tuesday. That was shortlived. It fell more than 20 on friday. And down. N up the ceo of medlock joins us now medbox joins us now. Just too much hype here. Good morning. I would have to disagree. This is about freedom, it is about individuals rights. Who is to say it is not undervalued. The market is always correct. We know that. At any one time the market can be correct. Who really knows where this industry can go. It can go soaring up in that direction and then take all the stocks with it. This is really Something Special for our country. A are talking about we are talking about huge growth. I am sure you are aware that finra issuedys ago a fraud warning on marijuana related stocks. Many of these companies are thinly traded. They gave this warning out to investors. Of some concern to you as well. It is not a concern to us personally. I dont believe it was directed towards us. There were other stocks in our sector which i would be careful of as well. I support them 100 . Lets talk about your business then. You dispense marijuana three or vending machines. You are not in the business of actually selling it, you just sell the machines that can sell it. Tell me what the business is like for you. It is now legalized in colorado and washington. Do you have those markets blanketed . Lets take a step back and say it is not just about our technology. Yes we do manufacture technology. That is the most legally compliant way to inventory control, store, and dispense the medication. Are actually an Industry Leader because we are the most successful marijuana consultants in the industry. We match entrepreneurs and investors. We dont make money off of the transfer of the meds. Where are you finding the most profit . Because of our relationships, marijuana is a growing industry. The opportunity is everywhere. Theres going to be a franchisor like mcdonalds. Theres going to be an organic or farming component. Opportunity because we are the leaders of the industry and have the relationships to literally be the conglomerate that represents all of these particular facets of the business of the industry. That is the potential. Where is your competitive lead . What is to prevent other companies from using the same technology . Industry knowledge is second to none. We have been doing this for four years. We have helped hundreds of clients in many states. Actability to move fast and set uss really going to apart from everything else. Medbox. Eo of juniper is being targeted by the activist fund scarlet fu has the breakdown. The regulatory filing just crossed. They have built up the six , which competes with the computer networking equipment. The plan here is to boost Juniper Networks share price to the range of 35 from the range of 35 to 45 per share. The timing is interesting. Perhaps an opportune moment. Some surprising news on that front. We have more of these deals crossing this morning. Is buying jim been in a 14 billion deal to create the largest premium spirits company. Christina, tell us how this came together in them a is huge in japan. It is a soft drink maker. Suntory products are everywhere. This is their attempt to become an international player. Those are the coproducing the dominate liquor and beverages across the world. This is suntorys attempt to be one of the big boys. This does mark a pretty impressive marker here. Transactionss order which is more risky from and integration standpoint. We are seeing a more risk in the be goodet, which could news to bankers and lawyers. This is the year for mnj. Four m and a a. For m to do isory is putting take these plans and even if their Growth Potential isnt as high, it may be high in asia and emerging markets. Blackmun has a holding in the use . Provide he has a legacy holding. He is generating quite a return for investors. Andave the chairman of the saying they have achieved a total shareholder return of six. Ercent we have Mario Cappelli on and a tremendous return for shareholders. Mario cappelli has been really big on mnj. He has been he has been big. Cristina alesci, our deals reporter. Moving and shaking this hour, arod will file an injunction in federal court in an attempt to block the seasonlong suspension for performanceenhancing trucks. Biogenesis founder admitted he received 12,000 per month to keep the yankee star on performance enhancing drugs. Baseball Player Association says it may file a grievance against the mlb for his appearance on the program. Coming up, ford is making a big change to the bestselling truck. We will take you to the Detroit Auto Show for a behind the wheel look at the f1 50, the new lighter version. And jimmy lee tells us what it takes to work smart and what he would be doing if he wasnt one of wall streets because dealmakers. Biggest dealmakers. Some of the hardest cars the hottest cars are being unveiled over the next few days. Down withr is sitting the man behind all of those changes. One change he will not be going to microsoft. You will continue to serve fortis chief executive officer. Im so happy for you and the customers. Now we can focus on these Product Launches. This is the biggest Product Launch of the year. What do you think . I have to have an unbiased opinion as a journalist. I am incredibly impressed. You have builtin motorcycle ramps. Taking ay you are gamble, taking a risk. What you say to them . , i sure dont think so. Mice i sure dont think so. Now we arekground going to put this on our highest volume vehicle. Aluminum is stronger than steel. The capability, the towing, this is going to be tremendously appreciated by the ford customers. Obviously he put such a huge importance on the ecosystem, the environment. He said we still have the power. Can you do it with a v6 . That is part of our durability testing. We have to make sure it is absolutely an improvement in the toughness. Offer forng to engines. We are going to have to ego boost engines. They raced this truck in the baja without telling anybody. It did really well. That will be a v6. We will have the complete spectrum of engines. Economy and the responsiveness that goes with those with a lightweight the a call, it is going to be a tremendous improvement. American car makers have not been in the midsized truck market for a long time. You think they need to go there . We think they cover all of the requirements for a truck. We have them all in the different price ranges. They can get the capability but also it is very affordable. The ranger has gotten to be a small segment. No new ford ranger . We will have that meet that we will have that vehicle here immediately. That of the beauty of the one ford plan. Class . In one of the things i have noticed is all of these new , they have created a slowdown in profitability for 2014. Why is that . We are investing more in the new products and production. The neatest thing about our planet is growth over the long term for everybody. This year happens to be our most aggressive we are going to launch 23 new vehicles in 2014. We are also expanding our production capability. We also increased our production across the United States. We have a lot of investment that continues to deliver profitable growth. You had a record year in china. Is that going to continue . That kind of hiring and growth . We will be hiring 11,000 new employees. This is increasing the production so we can continue with these complete vehicle families. Hopefully i will get to drive the new mustang. What did you think about that . Isnt it cool . Is a great car. Is the first time we are going to offer lefthand drive and righthand drive. Are 300 mustang clubs around the world and 60 that are outside the United States that dont have mustangs. And now theyre going to have that. Alan mulally, thank you so much for joining us. The ceo of ford and he will remain that until at least 2014. Thank you, matt miller at the Detroit Auto Show. We will have the top 10 traits you will not want to missed want to miss. Welcome back, you are in the loop and i am betty liu. Bloomberg television is on the markets. Julie hyman has the latest right before the bell. I believe we are looking at where the markets closed out today on friday. Futures are indicating a lower open here this morning. We did have an up week. People are trying to figure out if the valuation for the s p 500, which is trading more than 15 times forward earnings, whether they are justified. Earnings should give us a little bit of a clue. Are on the markets again in 30 minutes. Topets count down with the 10. These are the only trades you need to know about today. Three Golden Globes last night. The awards, as sony operates under intense scrutiny. Particularly from activist investor low. Theyr nine is told. Ade an unsolicited offer that the drugmaker agreed to pay 7 million. 12 stake in the biotech company. Rareexpand treatments for genetic diseases. And aig plans to add 600 advisors and theyre planning to offer to boost sales. Number six, general motors, the automakers are closer to issuing a dividend. Are expectings one according to a cfo. Gm reports earnings next month and is likely heading for its 16th straight quarter. Shares of the Third Largest hamburger chain surged in the premarket. Therefore cap came in well above analyst estimates. There also an sing also announcing a Share Repurchase program. Is ford, ther automaker introducing and all of aluminum version of its top which kicks0 truck, off in detroit. Some are calling it a risky bet. Mulally told bloomberg hes confident in the companys decision to read bigger the big truck. Shares of the athletic retailer closing after the they have decelerated meaningfully. It happened just since the beginning of this month. Number two is express. The retailer cut its for your guidance, sing the drop in Holiday Shopping traffic was eager than anticipated. Also and being, shares of the company are surging in the premarket on the news that it is being bought by japans suntory. It would make suntory the Third Largest premium. Lets head over to chicago. The founder of average joe options is standing by. Good news is good for the stock market but bad news is also good for the stock market. Yes, it is. Beside perfect example. We have people justifying it was maybe a combination of numbers. The market was able to rally. We are at a real key spots on what the fed is going to do going forward. They can continue to try to taper, stop the taper, or try to wring more money bring more money to the table. Be hardally going to for the equity markets because obviously theres no place else to go. The key to watch is the 10 year. If it continues to rally than the markets are going to have a little bit of a problem. If they can get it back down it looks like we will go higher. What about earnings season . Were really getting into it. What is the feeling about it over all at the macro in the as a macro indicator . The problem with earnings season is we are seeing a common theme. Not showing any real growth. I think that will be the theme of this quarter. If we see growth that will be great news. Then these numbers will be justified. Great numbers on cheap money and cutting back on expenses, that is not very good. That does not bode well for the future economy. Financials are building up to you theyre all near highs right now. They are all near their tops, saying were are going to be in great shape. As long as we get some real growth, i will be happy. It will be higherquality. Joefounder of average options. From the trade to the call, i want to bring out a portfolio furtherand his call is tapering by the fed is going to cause more uncertainty. You are also just listening in on what todd was saying. You also have some doubts about a rally. We have had a time where markets are pricing very little risks. We do know at some point that is going to have to tighten. Most people are looking at it and saying this is one number. Nobody has put a good explanation behind why it was such a bad miss. If you look at where we are yearoveryear. At some point it can create some uncertainty in the market. There are pockets where you are getting more and more interested. One of those is emerging markets, which is an area where you have been keeping your eye on. I have. Part of the reason is valuations. The s p 500 is trading at 15. 5 times estimated earnings. The world Index Trading at about 15. A considerable discount. The risk is also tapering and what is going to happen. The 10 year yield in yellow. As yields go up, that has been a week on emerging markets. There is this concerned that as the fed begins to tighten, that will be a negative for emerging markets. The index pulled back five percent last year, even as the s p 500 was having a monster rally of nearly 30 . It is a great point. Even with emerging markets you cannot escape the grasp of the fed. You also have to realize that they really underperform for the last several years. It was not just last year. There is a risk with emerging markets, which is as the fed begins to unlock begins to unwind record stimulus, that draws capital. Because economies are structured more rigidly, it can create some dislocation. A lot is priced in. 12 times earning is compelling. The longterm growth rates are as good today as they were 12 months ago or five years ago when they were to the darling of wall street and of wall street. You have been looking at the bears on tech. Last year was a huge year for tech. Was one of the best ipos for the year. They dont really make sense. The meeting earningspershare overall for the snp, it is 8. 7 . For tech it is less than five percent and banks it is 14 . Acording to a note from research company, Tech Companies have the most negative pre announcements of any sector in the s p by a ratio of 13 to one, compared to two to one for the s p overall. I see you nodding your head. I think there is a lot of truth in that. You do have the social Media Companies who traded very high the mode very high multiples. Behind that are a lot of the Big Technology companies that are tied to business spending and investments. Theu look at the talk Top Five Companies in the sector, four of the five are trading below 15 times earnings. Ultimately you have a tale of two markets and tact. I think it is good value. Affected byen emerging markets. If he emerging markets get better, i think that will help large tech. The nonsocial Media Companies is what i am talking about. Thank you so much. Jpmorgan chase is jimmy lee on how to work smart. He latest book and how email etiquette can get you ahead. Just a few minutes in the session, stay in the loop. We are all trying to fulfill our new years resolution. One may be how to ramp up your career in 2014. I asked some of the biggest leaders in business. Kicking off our two weeks alone series, where we focus on what we askedat leaders, jimmy lee of jpmorgan what his secret is to success. Number one is you have to work hard. Theres just no getting away from that. Number two is you have to prepare like crazy. I am a huge believer in prior operation. The sound counterintuitive to the first and maybe even the second your family has to come first. People say, well how can your family come first if you have to work all the time . A highly organized person can actually do it. Play on the school calendar, the soccer schedule, whatever turns out to be. Treat those sessions like it was a meeting with jamie dimon. One of the things is preparation. Going into that meeting with the board and the ceo, really knowing your stuff is critical. What what i, 24yearold self . Gain a fewinches, pounds, try to make it in the nfl. For more advice on how to get ahead and work smart, stay tuned all this week. Staying with the theme of working smart, someone who knows want,about what people the Senior Editor of linkedin is joining us. The key topic for users on linkedin, how do i get ahead banking, aref there a lot of discussions on that . There is. Point well over the low and still slightly hurt by the global recession. Wall street is a place people want to go. It is the major leagues for finance. Of the young people are thinking we can do this better, we can avoid the mistakes that may or may not have contributed to the terrible things. It is interesting because they used to be wall street titans used to be the people that others looked up to. It is really the innovators, the big tech ceos and entrepreneurs. Street, the to wall chances of becoming ceo of jpmorgan is kind of small. If you do your own startup, you are the founder and you can be steve jobs. Uch more possible if you are a notch a printer that create something that resonates, you make your own company. Some of your most popular influencers are entrepreneurs a lot of our popular investors are people come through the ranks. They find balance, they manage their time. The most important thing seems to be that no matter who they are with, that seems like the most important thing. That is why you at why you can be with your family, should be with your family, and they love it. Everyone thinks that is all you are concerned about. That is why when youre on the golf course, that is the only thing that matters. It is that position that position the makes it. Being highly organized. Lets talk about some of the trends on linkedin. Etiquette bad e mail etiquette can get you ahead . , evan steagall gets an email from mark zuckerberg. Very casual. To buy your Company One Day . Maybe not. Instead of saying teen and asking people what is the proper form of dear sir and all that stuff . A, when i am in town i will look you up, kind of e mail. They consider that bad email etiquette . Proper form ife youre speaking to someone who is superior but that is the point. If you dont speak to someone you equalizerior, yourself and you put a person at ease. And there is a connection there. Interesting. Imber one article, which thought was very fascinating, what boston should not be asking their employees to do. A lot of things that drives employees crazy, we are going after work preand should really come. Heres my favorite charity. Evaluating yourself. Evaluate me. Kick me under the table if i am going to a meeting. Doit seems like people dont things you do yourself. It is an awkward position. Go out there so they know how important it is. Some of these things are commonsensical but a lot of things people do not understand. Thank you so much for joining us. Page out my linkedin coming up, a major traffic jam in thailand. We will tell you more in a moment. Negotiators temporary freeze temporarily freeze Irans Nuclear program. Bill mattingly is with us now. What if the administration think this is the right path forward . Administration officials stressed that what this does is give them time. Agreed to is have they will halt they will convert or dilute their stockpile to about 20 . They will also stop the production of antinew centrifuges that are not currently in operation. This gives them time to try to work out a brighter deal. Iransts a positive on ability to get a cap capacity, they saying that have added weeks to process because of this deal. Some of their own allies are opposed to this. That is right. This threat is real from capitol hill. Lawmakers are wary of this deal. They are willing to give them the six months to work but there will watching the demonstration to sign off on legislation. President obama has threatened to veto this legislation. That is not stopped democrats and republicans from going forward. Phil mattingly in washington. The Prime Minister will be late to rest at his desert ranch. A stroke left him in a coma. Australia will australian leaders paid tribute to him. Nearly 80,000 protesters blocked major roads and banks. The demonstrators say they will maintain the blockade until they agree to postpone the secondary election and allow unelected councils to perform the country to reform the countrys political system. Thatmagazine report says the french first lady was hospitalized for rest and some and some tests. They have been in a longterm relationship. She was not very well liked by the public. That does it for today. Tomorrow joe to fit joins me. Find out how the real estate giant used his work smarts to work his way up. Is approaching 56 minutes past the hour. Bloomberg tv is on the markets. Focus,our futures and lets take a look at where markets are changing. Lowere a little bit of a open as people look at earnings for the rest of the week. Not really big declines. The s p just off two points. The markets are down a 10th of a percent acrosstheboard. As we frequently talked about, was the first was the years to was the worst year for gold. Joining me with a look at what has changed or what hasnt is greater than their page views to create that hes to trade on the floor. He used to trade on the floor. Whether you like it or not gold dust trade very technically. Traders look at the charts. As you spoke about last week, 2013 ended in a bear trap. Compared to the month before but there was no followthrough on a really low volume week. We are starting to see improving technical pictures. Momentum indicators that have not turned higher in months. The technical indicators, what about sentiment, especially on the heels of the jobs report on friday, which you think would be more fundamentally good for gold. Sentiment hasnt changed that much as far as positioning goes. The futures market and the gold etf market continues to see fund outflows, which you cannot blame traders. Because the rangers have gotten tighter. Also for my sentiment indicator, looking at fridays number, we saw the yield in the 10 year possibly making a double top at three percent. Of bonds are starting to turn up. This provides a tailwind for gold. What are some of the calendar items . Have theoff the top we fed funding, the federal budget has to get funded again for the fiscal year. Nobody is expecting much turmoil or volatility around that. You have cpi and ppi out this week. Earnings season is kicking off in equities. Gold tradershing will watch just to get up a temperature of what is going on in the overall equity markets. Technically we are watching 1270 to the upside. That could be a big level. Theres also a declining trendline. Confirm theically moment picture we are seeing. Onto the downside, were are looking at 1210. On the semioff bullish picture we have been talking about. Isit seems like the momentum more to the upside than the downside. In the short term to the immediate term, say over the next several weeks, on top of this we have the gold fix at the lowest level since april. A lot of traders look at that as a contrarian indicator. We are not sure which way it is going to be but things are pointing to the pointing to the upside. Thank you so much. We will be on the markets once again in 30 minutes. Market makers is up next. Live from bloomberg headquarters in new york, this is market makers, with Erik Schatzker and stephanie ruhle. The japanese Whiskey Company buys a name synonymous with american urban, urban bur ourbon. Midamerica is says it was a victim of a holiday breach. Neiman marcus says it was a victim of a holiday breach. A full seasons suspension