Toy are trying to raise up 9. 6 billion to buy a stake in italys largest phone company. Rules on major benchmarks. Banksere imposed after were accused of rigging libor. The u. S. Has attacked 12 refineries controlled by the Islamic State in its latest attempt to degrade and destroy the sunni militant group. Peter cook joins us from d. C. What do we know about these strikes . The third day of airstrikes by coalition forces. This involved both u. S. Aircraft, saudi aircraft, and aircraft from the united arab emirates. They went after modular refineries. There are 12 of them in eastern syria. These are refineries that the Islamic State was using to fuel forces in their own that part of the country. This was basically an attempt to hit them right in their pocketbook. These are refineries that are producing revenue for the Islamic State. These are targets that had been looked at for quite some time. Involved, as well. The initial take on the strikes were successful. Do not be surprised if more refineries and more of the infrastructure is targeted Going Forward. Buzzinge are still about president obamas speech at the u. N. Yesterday where he took direct aim at the terrorists and said now it is time for forceful action. It is very different than what he has talked about before and it echoed his predecessor. The white house is pushing back at the notion that the president sounded a lot like george w. Bush, but the president sounded a lot like george w. Bush in terms of language and tone. It is the most direct he has been in his appeal to the Muslim Community and his description of the muslim state Islamic State and the extremist groups and the threats they pose to the global community. It was a much more forceful take on foreign Going Forward and americas role in the middle east and the obligations of the rest of the global community. The message was certainly delivered to the World Leaders in that room. This is a speech people will be talking about for a long time to come, the president spent a good deal of time preparing for this speech. It was a new town that echoed from what we heard previously from president bush, and language alone. Figure so much, peter cook. Stay tuned right here on Bloomberg Television. The iranian president will be speaking. After a historic meeting with the u. K. Prime minister David Cameron. That was the first since the in 1979. Evolution we will bring you all the headlines from his talk starting at 9 00 a. M. Back to the market. The euro is weakening, nearing a twoyear low. The dollar is rising to a fouryear high. Are betting that mario draghi will weaken the euro to fight off inflation. More on what is going on in the forex markets, Jonathan Ferro joins us from london. Mario draghi plans to boost the ecb Balance Sheets. That is what is causing the turmoil . It is on one side of the trade. You also have to talk about how he is going to boost the ecb Balance Sheet. Cut ratese aggressively. He took the deposit rate negative. He has come out with a new asset purchase program. The bacon phone it the big component is funding for the eurozone banks. There is not much appetite. How does he expand the Balance Sheet . For a lot of people, the narrative right now is that he is going to have to conduct quantitative easing. I want to emphasize this point. The perception that he could do tot, that he should do that, bring the euro side of this trade lower, for the First Time Since november 2012, the move lower has been stunning. It has been predictable. In the meantime, the dollar seems like it is seeing pretty strong gains, hitting its fouryear high. Is this Dollar Strength or Euro Weakness . If you look at the dollar index, it is weighted against a basket of currencies. The biggest waiting is the euro. You are looking predominantly at the euro. If you look at the dollar separately, it is up against every single g 10 currency this morning. This is very much Dollar Strength. We are seeing it play out for several weeks. On the one side, you have the Federal Reserve with a new forecast for rates. There is a bit of weight being put on that. One of the reasons the dollar has moved higher. What a think we should Start Talking about is the impact of a stronger dollar on business, on markets. This is going to push down import costs. It is going to push down inflation. It is going to make the foreign earnings worth a little bit less. The dollar and the strength of the dollar could star biting the u. S. Economy and it is something we should Start Talking about. If it does, the rate hikes that everybody is talking about, you might have to push those back in little bit. That would be huge and significant here. Thank you so much, Jonathan Ferro of Bloomberg News. Moving and shaking this hour. It is apples ceo tim cook. What a difference a few days makes. Thats basking in the glow more than 10 million of his iphone 6s were sold. Now he is dealing with reports of the iphone 6 plus bending if you sit on it. The company pulled its new mobile Software Update after the program caused some people to lose cell service. Promising a new version of the Software Update being few days. In a tonight, be sure to catch my exclusive interview with former aig ceo Bob Benmosche. It is part of her latest edition of titans at the table. Is the largerthanlife wall street character who turned around the almost broken insurance giant. He is going to spend his retirement currently in croatia where he has a villa and a vineyard. In the piece, he has disclosed that his doctors gave him a most recent prognosis of 912 months to live in his years long battle with cancer. In one of our conversations, i asked him how hard it was to personally deal with cancer. I never was in a dark place. The hardest thing is telling denise. Then telling my son and my daughter. It was very hard on me. Then close friends. That able to say to them unfortunately, there is going to be a time frame here. Lets think about all the things we could celebrate of what we have already done. Thoughts went to keeping them from going into a dark place. Ask me, how are you feeling . Im feeling fine. Are you sure . There was a lot of that in the beginning . It has not ended yet, betty. [laughter] everybody asks and i say im feeling great. Doesnt get irritating . Very youre taking. When somebody has a terminal very your dating. When somebody has a terminal irritating. When somebody has a terminal illness, had you think they feel . What can we do to do exciting things . It is about thinking of your life and to join your life until you dont have a life. You can watch much more of my exclusive interview with bob in motion then motioned a Bob Benmosche tonight. Another titan. Derekl good night to jeter. Scalpers are looking anxiously at the weather as to whether their prices will go up. I bet you never had a boss like richard branson. Way to you here what he told employees about vacation time. After a historic twentyyear career, derek jeter is getting ready to play his last home game at Yankee Stadium. Baseball fans it is going to hit derek jeters on parade. Taking on the weather up in the bronx. It looks like it is kind of holding up there . Kind of holding up. It is raining. We have already seen some rain this morning. The National Weather service is calling for a 74 chance of rain. People are legitimately worried. Even mlb commissioner is worried. This is not any game. This is derek jeters final homestand. His final game in pinstripes. People have been talking about this moment since february. Ticket prices for this game skyrocketed. They fluctuated throughout the summer and then according to our friends before rain was a big factor, the average ticket price for a cd and Yankee Stadium tonight with 642. That is average. Wereighest price people willing to pay with 6,000. This cheapest ticket was selling for about 250. The numbers have come down a little bit. The prices have come down because of the rain. People are willing to pay world series prices to wave goodbye to derek jeter at Yankee Stadium tonight. This game does not even affect the postseason. The yankees are out of the playoffs. It is a huge game and a lot of money at stake with tickets. It has been a disappointing season if you are a yankees fan. What happens if the rain comes pouring down and all those hundreds of dollars of ticket prices . What happens to them . That is what everyone is looking at and everyone is worried about right now. Basically everybody loses. The yankees want this game to go on. It is a big deal to the city and a big deal to the same to the team. Exchanges would have to reimburse about 12 million worth of sales. Holders will only get reimbursed face value of the ticket. They will lose out as well. Shelby, thank you so much. Many Companies Paying tribute to the allstar athlete. Nike and the Michael Jordan brand started a trend earlier this year with this really touching, starstudded farewell at. Yankees,tting for the number two, derek jeter. Number 2. Yes, had to get that music in there. That was very touching music. Jeter has meant as much to nike as jordan has. Ellwood. Bring in mark he knows nothing about sports, just about shopping. [laughter] just about shopping. Tell us how important derek jeter has been to the nike brand. Incredibly important. He saw baseball through a pr crisis with the drugs and the steroid era. Mr. Clean. Ofeverybody had a shadow doubt cast upon them except for derek jeter. He was a great player. He was a mainstay for 20 years with the most valuable and most recognizable franchise. He did it completely clean. That is something that is truly valuable. Mark, you asked an interesting question. Maybe this whole Business Model of sports athletes endorsing brands and it has worked for them for this long and it is now kind of coming under pressure, maybe that model is starting to get broken. Like derek jeter comes along once in a generation. Now that we can access the endorsements sometimes through other than an ad, there are other things in play. Not tweeting were something drunkenly at 11 00 at night. They were beating up their fiances in an elevator. They were beating up their fiances in an elevator. They were not beating up their fiances and elevator. Might have been, but we would not have known about it. There are questions in the headquarters about whether it is worth hitching your brand to an individual. It needs to depersonalize. Anke an amazingly amazing sporting event moreeir lives are so much out there and it is so much harder to control the story of the athlete. Comparing how much derek jeter gets an endorsement versus other star players. He talked about tiger woods. Scandal, of course, not, 33 million. Why is derek jeter so behind these guys . A lot of it is the sport that he plays. Basketball reaches so many people and a younger demographic. Theybody is trying to get young consumers. A lot of it is baseball. There are concerns in 20 years about where baseball is going to be. You cannot say that about golf. You cant. [laughter] tiger woods launched the nikes golf brand. He is the one that they hitched their entire golf network to and it was phenomenally successful. I dont think derek jeter is ever going to make that money. Regardless of the fact that tiger may have had personal issues. Forion per jeter jeter per year is not bad. Especially for a baseball player. How would you rank certain athletes and their brands versus other celebrities and how successful they are in promotion promoting brands . When you look at kmart brand endorsements. ,f you look at Sofia Vergara she is the highestpaid actress on television, not because of modern family but because of what she makes out of bilingual ads. , lot of the fashion lines which are very identified with their endorsers, they make more money because they are creating their own company. When derek jeter is working with nike, he is not taking over the company. That is different. That might be why Michael Jordan is the king of endorsements. And hes after he retired is still endorsing. And better than anybody else. It is incredible. Wearwhole athletic becoming fashion. That is going to be a big boon for Companies Like nike . I think it is. Problem is that those close close that are perennial are not going to benefit from this. Should i wear my yoga pants on tv . I dare you to. [laughter] all right. Thank you so much. Mark ellwood. Evan. [laughter] of turning brands into profit, turning disneys frozen into cold, hard cash. Hasbro gets a shot at it. You are watching in the loop. I am betty liu. Our topa look at headlines. Regulators and china have found as much is 10 billion in fraudulent trade financing deals. Forge, andake, illegally reused documents for exports and imports. It gives criminals and illegal channel to move funds. Overseeing more than 36 billion , harvard picked an insider to run their fund. Theard branson is in running fors of the year. He told 170 employees at the virgin Group Head Office that they could take as much vacation as they want. As long as it does not harm the business. We will see how much harm we will see how long that lasts. We are on the markets. We did see a pretty big rally yesterday. Are going to good jobless claims in a few moments. We are on the markets again in 30 minutes. It is a question that affects all of us. The stock market is going up and the economy is getting better, so why arent americans getting a raise . Maybe they deserve a vacation. Mike mckee says you may be right to blame your boss. My boss is pretty generous. I dont know about unlimited vacation. There are a number of reasons. One of the most painfully ironic , the tyranny of the stock market. Unlike your paycheck, it keeps rising. Companies do need to maximize benefits to shareholders. The stock price up . You can increase revenue, cut expenses, or buy back stock. Hass the latitude that dominated. Since the recession, gdp has has beenrote growing, but topline has not. If you can boost the topline, you cut on the bottom line. One of the best ways is taking out of labor. Slow to hire, quick to cut. Here is a labor costs were rising during the last expansion. Here is what they are doing today. The other option, buy back stock. Billion inached 276 the first half of the year. Sinces the second busiest 1998. Companies also reducing number of shares. You put it all together and you get a graph like this, unfortunately. Corporate profits are near an alltime record. The s p is near an alltime record. The ever falling share is going to labor. Picking up,onomy is shouldnt revenue and income be going up . That is the hope. Janet yellen is banking on that. Attracts may have to workers with higher revenue growth. Revenue forecasts have gone up with the economy, but not as much as they were growing during the last time the economy was expanding. As private wages and salaries have been rising. What about janet yellen . Can she do anything to change that . She is hoping zero rates and qe are going to lift them in. The other irony here is that Company Analysts blame the fed for all the buyback. All right. That is certainly something to think about as we head toward jobless claims and the jobless market. Initial jobless claims, as we always look at on every thursday, they come in at 296,000. That would be below that key 300,000 level. How important are these jobless claims . How will they factor into the jobs report next week . They wont matter quite as much. They will add some data is what we are looking at. But Everybody Knows that we are not firing right now, but hiring. And continuing claims continues to be at 2. 4 . The market is fluctuating at a range. They did rally quite a bit. 293 thousand claims, below the 300,000 level. The 2. 4 million. That is also a little bit below what economists estimated. It is good news, because we are not seen a crash and jobless claims are not rising a lot. It does suggest job growth remains healthy. The more interesting number on a percentage basis is durable goods. It is down 18 . But we knew that would happen. It is not something we should worry about at this point because it is pretty much all boeing. Boeing had a really good month of july. They sold 374 airplanes at the farm bureau airshow. Borough airshow. You can see the difference in the numbers between reporting last month and this month. At the good news about durable the numbers is going to gdp are still rising at. 70 percentabout a rate. At a 7 10 rate. People are ordering more than they are able to deliver right now. Digest allcertainly of that Economic Data analyze how that plays into the markets today. Tonight on Bloomberg Television, we have Something Special for you. It is our next edition of titans at the table with the former aig ceo Bob Benmosche a. I travel to croatia to meet up with him. The larger than life wall street giant has turned around and almost ailed out Insurance Company following the financial crisis. This is the latest part in our series, which airs at 9 p. M. Eastern time tonight. Compared to other wall street titans, Lloyd Blankfein and jamie dimon, Bob Benmosche is less rested less recognizable, but you could not here where people came up to the hoping 64 co2 take it photo. Im really nobody. He talks about taking on the job of turning around aig. When you first get your hand on got your hands on the books at aig, what did you see a perplexed i did not actually look at the books. I had what did you see . I did not actually look at the books. I had a pretty good idea of what was in the books because i spent a lot of time with jim milstein. Jim was the restructuring executive who was handling this for the u. S. Treasury. I spent a lot of time with sarah dahlgren, who was also handling for the new year the new york fed. Was they did their due diligence. When milstein and dahlgren briefed you on what was going on and what they knew of the financials, were they better or worse with than what you thought . In line. The world thought they were worse than they really world they really were. Is, if thestion outside world thinks its that bad, got to get you to stop talking about how bad it is. Today, aig is a slimmeddown version of itself and profitable. But does it still pose a threat to the Financial System . Another aighink will happen. We will not see another aig crisis again . No. Weve been in this position for over two years. I dont think you will see a bank failure. I dont think you will see a securities industry failure like their early men. Lehman. Ike bear or up toyou give a thumbs the industry than. I give them a thumbsup, but a thumbs down for not telling the public. Why dont you talk about how much progress youve made since 2008 . Their answer is, well, were not sure that something can go wrong. Cant go wrong. And i said, shame on you, because you should be sure. Im sure. But hes sure, hes sure. Hes sure about a lot of things. You can see more of this exclusive interview with Bob Benmosche. 9 p. M. Eastern time only on Bloomberg Television. And speaking of titans, another wall street titan is now under pressure. Gross from pimco. We will bring you more on why his bond etf is now under sec scrutiny. Thatrage to come story to come. A drum may be coming to a neighborhood near you. Heres a look at tech stories. Apple is a public is apologizing for a glitch in its new system. Lost cellular service. Isgles Android Software apples biggest rival in wireless. About sales on Bloomberg Television. I would say that this brutal competition between apple and google has enormous benefits for consumers worldwide. That competition, which i think is the defining fight of the computer industry today, but if it benefits people at the global level. Boosted hisison has amount of stocks to almost 10 billion, 250 million shares that he has pledged. That he isannounced stepping down as the cio and a Technology Officer for oracle. And small Unmanned Aircraft for filmmaking. This is according to people with knowledge of the plan. That would be the first on the commercial drone flights have been approved in the continental u. S. I thought they were doing that anyway. And the wars are heating up after partnering with mattel for its merchandise, disney is now going with hasbro for it frozen and princess brand. Why go with hasbro . This is a major coup for hasbro, which has typically been known in the industry as the maker of toys for boys. Now it is looking to make a submission into the girls category. The company has to ask has to secure exclusive licenses for the frozen and princess brand. And it is taking those from mattel, which has been making the merchandise traditionally. The deal will not go into effect until 2016. Over the next two holiday cycles, mattel will have exclusive rights to the merchandise. I spoke to a couple of analyst this morning and many were surprised by including stephanie with that from piper jaffray, who says mattel has been the third priority after barbie and the monster hide all. This is a huge victory for hasbro. She is concerned about the weakness she seeing in the overall barbie category. She has put underperformance on the stock. I also spoke to linda bolton at bde who said this will hurt mattel Going Forward. I imagine, something as big as this. How big a market is disney . Doesnt stands, mattel provide the contribution of revenue to their overall sales portfolio, but according to needham, about half 1 billion last year. That will depress 201516 estimates. And he is surprised that mattel did not go all out trying to secure this license for the next couple of years. Perhaps one of the reasons is they think momentum will slow down for the frozen brand. To which i said, have you seen any playground . I dont think thats going away anytime soon. Dont tell that to little girls. My question is my question is, how did hasbro wing disney over . The co is telling bloomberg that it is because they provided new innovative ways to showcase their merchandise. They said they provided a fresh look at how you can provide this content. Also, they said they would prioritize this as number one. That is very important. It sounds like they are throwing a lot of support and a lot of money. It is a huge industry, 22 billion. It is. Winning the frozen line. And somebody needs to win around pimco, because they have been under the microscope and under pressure. Regulators are investigating one of the firms most popular funds. We will dig deeper into this case. We will be back. Today, we are learning that sec dove into investigation into pimco is separate. This is targeted at pimco. This is a look at whether pimco bought smaller bonds and then marked them up. I want to bring in eric, who covers etfs for us here at bloomberg. What is going on . Intoe sec is looking whether pimco marked these bonds up. But really, if the Pricing Service they used. On our subjective. The Pricing Services looking at more liquid bonds. When you do that and you are calculating, you get an. Mmediate pop it is priced a little higher. This is pretty normal practice in the etf industry. To me at worst, this is pimco exploiting a little loophole. And industry practice . Yes, and at best, it bill gross being the best at his job in the world by providing value to shareholders. What caught the attention of sec and our attention is that when this first came out in march, 2012, it went on a mad tear. It turned 12 in its first eight months, which is a lot for a bond fund. But was it outpacing its peers . And did beat the s p, which was up 5 , and the mutual funds, which was up 7 . Do you think it is because of this pricing . I think so. But at the time, a lot of the bonds were very liquid. I dont know how big an effect it had. When you first start of fun, you dont have any assets. It has a more it has more of an impact, this thing, then say, when you get bigger. As you get bigger, this practice becomes more deluded and has less of an effect. If you look at mutual funds since 2012, its a lot closer. Its beating it, but not by the stretch it did early on. Is a pretty illiquid . Are, but the bond market in general applying equity like trading in the bottom market has caused a lot of questions in the etfs. Its just a different kind of market. But its pretty illiquid. Its not like senior loans. Matt levine, whos one of our bloom bloomberg review columnist, wrote a defense sort of. It kind of opens of how the etf world works. Column that came out yesterday, he said, for stuff that does not trade every day, the market price is a bit of a fiction anyway, and pimco was up front that it would use Pricing Services to value its asset if they dont trade much. If pimco things the price they itst at was wrong and Pricing Service was right, then why shouldnt they use that price . Right, if you are a pimco shareholder, that is what you are saying. If you are a mutual Fund Shareholder and you see the etf just literally doubling the performance in the first three months, you are like, hey, why are we getting some of this . Why arent we getting some of this . It might not be a question of this being a bad practice. I think its a good thing to do if you can get value for your shareholders. The thing that i think that is not just that its with etfs, per se. Its when you first launch a son a fund and you look at performance. The thing is to say, look, did you do this just to get a little extra pop for your fund. Yes, and did you do any misleading, or was it just a valuation loophole that was an extra way to get value just beyond getting picking good bonds . Are we watching this case cap up bill gross this case . Ogroats is a rockstar. Asset wise, hes up bill gross is a rockstar. Is only 3, it he billion. In the realm of the relatively managed etfs, he is a big deal. The first wave. That is why they are watching. It. You for explaining what is a very complicated story. Goldplatedamerica is fighter plane finally gets to show its stuff in combat. We are going to talk about the f22. Les, a surprising meeting in iran. Plus, a surprising meeting in iran. Todays big number, 67 billion, that is the cost of the f22 fighter program, one of the most expensive in pentagon history. It finally made its debut in combat. It took part in air raids on Islamic State targets in syria. It is considered the most advanced fighter in the entire world. U. S. E meantime, other companies are trading at record prices. Investors say the sales will rise because of fighting in syria and ukraine. Ankheed martin sales hit alltime high last week. They make the f22. Raytheon, andan, General Dynamics also hit record highs in their stock prices. It is six minutes past the hour, which means bloomer television is on the markets. Bit higher than last week, but still below the 300,000 level for employment. Durable goods falling 18 . Again in 30e market minutes. Coming up, apple just lost a lot of that goodwill. , iphone in the software set band if you sit on them. That bend if you sit on them. We will tell you what is going on. We are about 30 minutes away from the opening bell. Im betty liu. Here is what we are working on. Equities bounced yesterday after a threeday slump. And this morning, firsttime jobless claims climb to less than forecast, increasing 12,000 up to 293 thousand. Claims are still below 300,000. And executives on three cotton and make a 9. 6 billion dollar bid on three continents make a 9. 6 billion bid. After announcing record iphone sales, apple is awash in problems. It is having to fix glitches in the new operating system, and users complain that if you sit on the new larger iphone, you will bend it. Maybe, do not sit on it. In the market, though, in the s p, three straight years without a correction. A minor freak out has sent the s p down 1 13 times so far this year. Its not enough to derail this five year bull run that has pushed the index to record levels. The dips have shown some common characteristics. We will parse through what they all mean. I want to bring in our Bloomberg News stocks editor, mike reagan. Commentary when we see these 1 decline, right . Soundst, and 13 gets, it like a lot. We actually had 19 last year. These are gifts that occur over one or two days, and about 1. 7 on average. Getting any worse or more frequent, but they are showing some fascinating similarities. Consumer discretionary stocks, you know, the group that includes retailers, hotel chains, restaurant chain, they tend to be among the worst performers of all of the steps. Of the 13 gets this year, nine of them in Consumer Discretionary stocks have been among the worst three groups. Not coincidentally, its also the group that is of the most in the bull market since 2009, almost 300 . Is it because its been up so much, thats why its down . Bike that is part of it. Its also about the consumer that is part of it. Its also about the consumer with rate hikes coming. Goldman sachs report shows that about one quarter of Hedge Fund Stocks are Consumer Discretionary. Its a very Popular Group for hedge funds. And what about the other sectors that are getting dumped . Side, utilities are performing the best, which is a bit surprising, considering they are ratesensitive. Their dividend yield start to get a lot of competition as treasury rate rise. These are the out performers then. Yes, 10 times they have dipped among the three best groups. And consumer to staples Consumer Staples are on the good side. Thank you so much, our stocks editor mike regan. We are about half an hour away from the opening bell. In the meantime, you tim cook may feel like pulling the covers over his head after just three days of apple announcing they have sold record numbers of their iphone 6. Now they have reports of crash rates and loss of service. Pull the apple to software. And then there were the viral iphone 6 showing the bending. Andrew levy this with is with one of the First Companies to of the system. Also with us, gregg harper. You this morning. Andrew, let me start with you. You have some new steps on the amount of crashes weve seen with this update. What are they . Good morning. Yes, weve seen about a 3. 5 failure rate of apps on ios running on ios eight. Over half the revenues are coming through mobile channels. Ebay is driving over 50 billion in its commerce platform. These companies depend on a mobile for it the revenue, and users are pretty unforgiving. There are 1. 3 million apps in the app store. If an app is not working, you will move onto the next one. But that crash rate that you just quoted, i mean, is that rate wehan the crash saw with the update in the ios 7 . It is slightly higher. A lot of changes have been made in the platform. Various changes with supporting the screen the different screen sizes. The gpu, they have improved Graphics Performance significantly. We have seen a lower rate on the but on the older devices its causing more issues. Like mine, the iphone 5. The dealbreaker, the iphone crashing or the bending . The iphone software, they will fix those crashes. Im not worried about that. Its a pain to me, too. I have a six. Dont upgrade to an 8. 1. They have pulled it, so you cannot do it anyway, but dont be the first on the block. It is then. Spent, it doesnt bend back. Once it is bent, it is bent. It doesnt then back. When you bend it, it is aluminum. It bends and creases. You have the iphone 6. That wont bend, right . It will, too, but its not bigger. Laws of physics larger surface, easier to bend. Their sitting with it in back pocket, not a good idea. But with the iphone 4 with the antenna gate, People Holding in a certain way. The answer is, dont put it in your back pocket. Dont sit on it. Its pretty simple. Andrew . I would say it is apples first tablet. They are new to the market there. They may release another case. Like with antenna gate, to help there. If you look at ios 7, there were two updates in the first month of the release. They really do care about user experience. They are trying to move fast. It looked like they may have moved a little too fast for this latest update. Areou said that consumers very unforgiving, though, right . I mean, they are. You look at the number one reason for bad reviews in the app store and it is performance problems. They will try to download a nap and then just move onto the next one. If you look at the top apps in the app store, they are pulling in millions per day. Their lifeblood is having users you know, user retention. Usingcoming back and their Services Month after month. Greg is shaking his head. People want to be part of the adventure. Throughthat is getting these software crashes. I think they will be much more forgiving. Its a pain in the bud right now, but not the end of the world. Youre right, Consumers Want to be on the leading edge. Being used fors pointofsale devices. Retail especially has adopted iphones and ipads. Its a big deal if you cant check out. If your employees cannot do their job. Greg, how do you like the iphone 6, by the way . I like it, but not in love with it. It definitely has some issues. For example, there is a new way to disable some of the iphone features. One of them is these emoticons that show up on the keyboard. Im constantly typing and then suddenly, this smiley face pops up because the keyboard is different. There are some new things that i dont like too much. Ive had crashes. It happened in the middle of the day recently and the only way to solve it was to reboot the phone. You have guys phone six you have the iphone 6 with the new software. Not be a. 1. Not the 8. 1. It came with eight software. And it brokeupdate some things. But there were other problems before that i stayed even happened. It sounds like you two are critical, but also forgiving. I think at the end of the day they will sell quite a few pieces of this product. And i think people will say they are part of the adventure. Its a nice story to tell and i was there. Benthe bending, once it is it is bent. Use it carefully. Are people returning it . Some are successfully. But they will say, maybe we will do this once if it looked like it was not purposely bent, like the blogger on tv. But they will probably come up with the case for this. This one has slipped out of my hands multiple times already. Gregg harper, thank you. And andrew levy to my joining us from it san francisco. And a reminder, tonight at 9 00 p. M. Eastern time, my exclusive. Nterview with Bob Benmosche details on his stepping down as the ceo. Iranian president rouhani is set to speak at the u. N. And just about 15 minutes. He is excited to speak about the global threat of the islamic sanctions. Lso you can see it at bloomberg. Com. Our next guest is the harvard researcher for science and international affairs. He met with rouhani yesterday. From cook also joins us washington with the white house angle. Gary, lets start with you. You met with rouhani and a group of other war and policy advisers , and later you met oneonone with his staff. Tell me what the meeting was about. What i found most interesting is that the iranians are very ambivalent about president. Bamas campaign against isis on one hand, they are happy we are killing their enemies, and i hope they can gain some advantage in the nuclear negotiations. But i think they are nervous that the u. S. May be able to increase its influence in baghdad. And of course, they are very worried about u. S. Efforts to strengthen the opposition to will eventually be successful in overthrowing a thought. Peter, give me your take in overthrowing assad. Me your take. What will the president do today . Does he have any plans to meet rouhani . That would be very big if they were to meet facetoface. There have been rumors and speculation in the past couple of weeks that maybe they would. There was a famous phone call they had at this time last year. There is no sense at this point that the president will meet up with rouhani in any way, or that they will even have a phone call. It is such a delicate moment right now. The Nuclear Talks, and at the same time trying to if not coordinate with the iranians in dealing with the islamist state, at least working in the same direction to confront that threat. If they met today, that would be big news. I dont see it happening. And you dont either, right, gary . No, i dont think it was it was preclear that rouhani fell to the there was it was pretty clear that ronnie felt there was not much to gain by meeting with obama. And particularly on the nuclear issue, the two sides have hit a brick wall in terms of their disagreement on the fundamental question of the nuclear program. That was one thing that David Cameron mentioned as well in his meeting with rouhani yesterday. I want to play one part of what cameron said after his meeting. Iran should also be given the chance to show it can be part of the solution, not part of the problem. Earlier today, i met with president rouhani. We have severe disagreements. Irans support for terrorist organizations, its nuclear program, its treatment of its people all of these need to change. But irans leaders could help in defeating the threat from isil. But will they help . Will they cooperate . I think they have an interest in seeing isil defeated. They will cooperate in that the shia militia on the ground will be defending shia territories. But they have their own vested interest. But yes, and they will act in ownr they have their vested interests. Yes, and they will act in their own interest. But it will come down to what the government will look like. I think the iranians will be wary of a government that is too inclusive in iraq. Thatirans standpoint, could weaken their position in baghdad. But that would be a nono for them. What about that would be a nono for them. What about congress . What are they saying about the Nuclear Talks with iran . There are particular members of the senate watching very closely. There are republicans and democrats that are highly skeptical that these talks would ever be successful, and skeptical that the administration will drive a hard enough bargain. They are watching it like hawks right now. And they are ready to, perhaps step up sanctions or take action themselves in congress if they see the administration, in their view, cutting a deal that is not in the countrys best interest. Peter, thank you so much. Our chief washington correspondent, peter cook. And also to you, gary, director of research for science and international affairs. Make sure to watch bloomer television this evening. There will be an indepth interview watch Bloomberg Television this evening. There will be an indepth interview with Hassan Rouhani at 8 00 p. M. A traffic jam that means even some billionaires have to act just like us. We are talking about Boehner Blackstone ceo Steve Schwarzman. He could not deal with the traffic jams caused by the u. N. Session, so what did he do . The Steve Schwarzman hopped on the subway. That is the picture that ended up on twitter. He is said to be going to a meeting with heads of state. That is certainly one way to get there, good old york metro. Coming up, the Islamic State is now targeting oil facilities. We will talk to tom harper of delaware. Plus, to inventions that were made for each other, drones and Action Sports cams. We are 11 minutes away from the opening bell. As we head toward the bell, moving and shaking this hour. This is a happy man. The sports camera has become industry standard. Plus, shares are up within 2 since the ipo in june. Now we are likely to see an increase in business. Government regulators are going to let seven movie and Television Companies to use drones in filmmaking. Its the first time regulators have okd commercial use of drones. Go pro is among the companies that have lobbied the government to do just that. In the meantime, it looks like oprah will face in competition with polaroid go pro will face competition with polaroid coming out with its own camera. We are just a few moments away from the opening bell. Welcome back. You are in the loop and im betty liu. Liver television is on the market. Here is the latest Bloomberg Television is on the markets. Heres the latest. We had a huge runup yesterday, so it looks like that bull rowdy rally is intact. We are on the market again in 30 minutes. I want to make a quick correction. Yesterday, we said it centered itself, putting the downbeat on competition from new contracts from rivals like ibm. Writing about earnings said that. Abouture made no writings that in his call. Toplets count down to the 10. Scarlet fu joins in. Ford. 10, the auto giant hired more than 14,000 Domestic Workers since 2011, topping a pledge it made three years ago. Ford had promised to include 12,000 workers by 2015. In may, hiring was ahead of schedule and it would likely overshoot that number, it said. That is one way to overshoot. Number nine, the toymaker is partnering with disney to make dolls for the popular movie frozen, in 2016, thus leaving rival mattel out in the cold. Its been a bright spot for hasbro. Bad news for barbie. Bad news, indeed. Number eight is intel. , making it surged the best performing stock in the dell. In the dow. And at number seven, citizens financial group, a u. S. Subsidiary of royal bank of scotland. Gearing up for its ipo. Shares gained more than 7 in its yesterday debut on the new york stock exchange. This is the second largest ipo after alibaba. The biggest ipo since 1999. But he got none of the hype. Nobody cares. Number six, something you should care about, in the farm affect her. Closing a licensing deal for commercialization of its inhaled insulin products. That is a huge game changer for anyone with diabetes. It will receive a 150 million upfront payment within 10 days of closing the stock. Of closing. The stock is surging. Seven, benefiting from small strong sales. Four, softbank owns about one third of the chinese ecommerce giant about one third. The chinese ecommerce giant has fallen. It must have been used as a proxy in the lead up. They did not sell any of their stake in that ipo. Yes, they are all in. Number three, valley pharmaceuticals. The company name and activist investor to the its board. This in its hostile takeover of our den, the maker of botox. Number two, apple. A few days after announcing record iphone sales, more than 10 million in its first weekend, the tech giant awash in problems. They had to pull their Software Update after it caused some people to lose cell dont sit on it. And dont update your software. Number one, nike. Reporting after the bell today. Fourthquarter earnings at . 88 a share with doubledigit growth in future orders in emerging markets in western europe am a nike shares trading at alltime high. Scarlet is an yankee blue because derek jeter, when of the big endorsers for nike. We will see if the game gets played tonight. Are you going to cry . I will be teary. An entrepreneur, the former chief equity strategist recently ifided that she told mrs. Years ago. You wanted to get out on your own. This is the first time youre on Bloomberg Television after you started this. We feel honored by this. Ask i am honored to be here. What made you pull the trigger . I think it had a lot to do with feeling was the right time. I felt pretty good about the cumulative work weve done a jpmorgan. Jpmorgan is a great place, but i was also realizing i am at an age when i still have a chance to do a couple of careers. I am 44. You are young. Yes but old enough to have to think about it. Thought, now is a good time to take the risk. We are building what we want to be, really research centric, Strategy Research house that partners with our client. You are to have some calls out on the markets. You are said the fact now on your own, you can make some contrary and calls. What is a call that you can make now that maybe you could not have made it david morgan . Our work is different because we do topdown work. We try to find practical ideas for clients. But we could not really say, hey, heres a stock that we think is a buy, but her analyst has it as a. We could not include those names in our list. Now we have the freedom to say,ey, here is a bunch of ideas history says these are great ideas, theres a great setup. By the way, we can show you the broker, theat every target prices, and we can say this is a contrarian idea. What is a contrarian idea then . Country inhe biggest call to make is is is ok to be long right now all the way into a tightening cycle. The contrarian make right now is it is ok to take risk. When you look at sectors i think where we are starting to think we could be contrarian is on consumer cyclicals. It may be time to actually dive into them again. Into a fed hike. We have a lot of details and upcoming reports on that call. Too, value is really going start outperforming from this point Going Forward. I think people think you want to be buying growth stocks. You like macys. I even looking into some bearish reasons for why you might want to be more cautious. Three reasons slowing sales gains, competitors like nordstrom and jcpenney have caught up to macys on the channel model that blends the in store with the online experience. And sources say it is unclear after macys has outperformed its rivals over the last four years. Chuck pretty well. He is a guy i knew a jpmorgan for many years. He will know more about it than i will. Even after the runup. Another stock you like his microsoft. The stocks head in a credible run, up over 40 last or come up over 25 so far this year. He was to move into mobile and cloud. The trouble is, clout is very competitive these days. More and more people are getting into it. They dont have any cut of hardware device that is going to rival android or apple. Then you could back to their core business, pc plus arent going to back down to pcs arent going to bounce back anytime soon. It is built into the computer as a default, that is a problem for us. What i think microsoft is an interesting case study in how a new group of investors is going to discover technology stocks. Everything you have said is true. Technology is a competitive space. I think a lot of people perceive microsoft may be in the wrong places or where theyre trying to grow it is competitive, but you have to keep in mind it is a bluechip company. Huge profit margins. It is some highly talented employees. When it comes to looking at industries that have similar gpfiles, stables is a study type sector. Tons of competition, but look at what you pay for stock. Microsoft is an example of an old tech name that will probably research. And dividend as well. Getting back to your contrarian call, why do you think we should continue to add on risk going into a rate hike . Im speaking before have maybe all the ducks lined up, but i was a history argues donttrongly that markets fall because of rate hikes themselves, their actually responding to the underlying conditions. In other words, if the fed is going to begin a rate hike cycle because the economy is going to be stronger, yet to realize the on is a dependent variable underlying conditions, so you want to belong equity. Or pressures are building then that is a different story. I dont think we are in that environment. Maybe that is one of the ducks you need to get in a row. And wherelot of data excited to Start Publishing it, but i dont want to give all of our secrets away. We will have to have you back. Tom, congratulations on the move. Tom lee. Thanks to scarlet and olivia. Coming up, the u. S. Is targeting the Islamic States. We will talk to the chairman of the Senate Committee of Homeland Security and Governmental Affairs about the strikes in just a few moments. 9 00 p. M. Eastern, my exclusive interview on the latest installment on titans at the table. Stay in the loop. The president has been strengthened his rhetoric on the Islamic State. Degrade and destroy the sunni rebels. The carried interest speech yesterday at the u. N. , calling for Worldwide Campaign against the Islamic State. There can be no reasoning, no negotiation with this brand of evil. By only language understood killers like this is the language of force. The United States of america will work with a Broad Coalition to dismantle this network of death. The only man which is a language of force. For more on the president s speech yesterday and the support by Congress Committees airstrikes in syria, i want to bring in democratic senator tom carper of delaware was the chairman of the Senate Committee officeland security and of Governmental Affairs. He served as a naval flight officer in the vietnam war. Senator, thank you for joining us this morning. Did you support the president plus much sharper, much harder line against terrorism yesterday . You bet i do. Bill clinton used to say, better be strong and wrong than weak but right. I a very much encouraged. However, there are others who ,ay, it is a little too late that he had not defined his foreignpolicy clear enough until now. Is that going to hurt the president , senator . As harry truman was set, dealing thing new in the world is the history never learn. If you go back to the invasion of kuwait by saddam hussein, we march in and attack the forces of iraq and saddam hussein, we put together an international coalition, which at the United Nations for the blessing, sought to convince the iraqis to withdraw without further a do. They did not. After a month or so, we just put it all together and we were ready to go after the bad guys, push them all the way back to baghdad. What were doing here is similar. Were beginning to practice this is a little like football. It is not a sport, but it is like football. In the airstrikes, working with the saudis, the folks from uae, Ground Troops in iraq am a kurdish Ground Troops. It is like going into right of a season of nfl and not having an exhibition game. We are getting together and putting the coalition together. We are not practicing. This is regular season. It is dangerous and difficult. You heard the u. S. Ambassador to the u. N. Samantha power over the weekend saying she has gathered more than 40 allies in the airstrikes against syria and in syria against Islamic State. Do you believe, senator, where going to build a taker of this with limited airstrikes and in fact, were not going to have to go in there with Ground Troops and if we do, does the president need to go to congress . Troops on 1000 or so the ground in iraq. Theyre providing not just defending our emcees and consulates, but providing training and support and intelligence, if you will, for the iraqis, for the kurds. That is an appropriate role. There are plenty of iraqi troops that we have equipped and help train. Here are kurdish troops we are doing more in training them. There are jobs for us to do. A lot of what we can do is from the air. Their others i hope theyre prepared to do that. Senator, a gymnastic issue that you have been or has been a domestic issue on your radar any of them pushing through congress, hard to see how they can focus on this because they have so much else, but overhaul the postal system and try to get through this building congress. Now you have these private players like fedex and ups all competing for the business of Companies Like amazon or walmart or others. How do you see your bill being having any chance at all to pass through congress . It is a bipartisan bill. Waiting for action by the full senate. One of the things that Postal Services needed to do in recent years is right size the enterprise. With the internet, they no longer carry the same amount of firstclass mail they used to, for example. They reduced by roughly halffull, place and the number of Mail Processing centers. They transferred a lot of the rural post offices. Our role in congress is to make sure we pass a law and i think our bill does this that enables the Postal Service to get full value out of a totally unique 200yearold just reason network. Is it headed for bankruptcy . Not if we are smart about it. We have legislation and able to make money, capitalize the Postal Service and end up with billions of dollars in the bank, pay the money they own if we will just do it. The old nike saying, just do it. Thank you so much, senator tom carper of delaware. Staying on this theme, president obama would love to come in support of a time for minister Prime Minister in the fight against extremism. Erik schatzker sat down with renzi. Think about it this way. What is italy . It is a peninsula, a food jutting southward from continental into the mediterranean just above north africa. That puts into perspective and context for you what youre about to hear from matteo renzi. I think we must fight against withrism in syria and Iraq International coalition, but also in other countries, for example, india, and get the message of hope for these countries because after the arab spring, nothing has changed. There are a ranking of problems. He is with the west when it comes to syria, but he is just as concerned about the potential terrorism in libya and potential problems in egypt as well. Does he have support at home for his agenda . He has support for things like that but that times are much more concerned about what is going on internally. 12. 6 in employment. Unemployment. You tie in economy is a mess. Matteo renzi is thus concerned in the constitution and reforming italys antiquated they were laws, which make it very, very difficult to fire anybody as a result italy has trouble attracting capital for Investment Purposes and cannot get the economy going. That is his number one priority. Erikank you so much, it schatzker. Thank you. Still ahead, the ryder cup gets underway tomorrow. Phil mickelson already causing some drama. We will have much more, next. Time for the global outlook. Regulators in china have found on this 10 billion in fraudulent trade financing deals. The government says company stakes illegally reused documents for exports and imports. Authorities are the traits get criminals and illegal channel to move funds. Golfs ryder cup gets underway tomorrow and Phil Mickelson of the u. S. Is poking fun at the european team. He says u. S. Doesnt litigate against each other. Wo were injab at t court because roy mcilroy left a Management Company partly owned by mcdowell. We will see how that goes. That does it for today on in the loop. Tomorrow, former chairman of Nbc Universal bob wright will join host. A guest Bloomberg Television is on the markets. Were 30 minutes into the start of the u. S. Trading day. Stocks are falling. In fact, the losses keep accelerating. P 500 now off, down 15 resuming the decline that we begin. To treasuries, Economic Data that was pretty much in line with what economists were looking for. The reversal in the 10year. The stronger dollar theme continues. Dollar index at 85. 26. Gold futures at a fresh 1215 an ounce. , lets start with the equity market. Down 3 4 1 . Not a big number, but it feels like it is the new 1. 5 lower. We have seen declines like this all year. The people bought back up yesterday. Now we are back down. If we do see a print there, we did see this slide. You been talking to Money Managers and investors and analysts. What do they say is the tone of the market . Was yesterday a better indication of what we were headed for the first three weeks first of the week we saw losses . Despite the price action we us in the last few days, theres speculation when the market does dip, it is an opportunity for the bulls to buy on the dip. Strategists on wall street are thinking s p is going to rise by the end of the year, but in of 2015 everyone is still constructive. People are just waiting to see the next big catalyst to the up move. You can trust it when alibaba was going public and there was a lot of anticipation. You and your colleagues wrote an excellent story on how it has been three days since the stock has been trading, which means people are now studying themselves to perhaps that against the stock. The first38 spike in a. People might be thinking that is a little ridiculous. We all know how they treated immediately and went public. By contrast, gopro, another big tech ipo this year, 70 . It has to be taken with a little grain of salt. If you want to play the downside, looking at about 67 . Proxy made an interesting observation, people arent looking at yahoo as a way to hedge against alibaba. If someone was to be constructive on yahoo , they might want to put on some sort of might want to borrow alibaba shares as a hedge to that position. Thank you so much. We will check in with you after the report and jobs coming up next week. Back on the markets in 30 minutes. Apples epic fail. Iphone that bends when you sit on it. An operating system that doesnt work very well. We will see what tim cooks next move ought to be. Italys Prime Minister vows ,o overhaul the labor market pitting him against the countrys most powerful union. Slam in the skies. The designer teams with nike and comes up with the ultimate travel experience for pro sports teams. That doesnt select a bull market, i dont know what does. You are watching market makers. Lets get to the news. The top business stories from around the world. An executive who has run phone countries on three continents may spend 9. 6 billion for at