What a painful end to last week. This is the worst week for the markets since 2012. It wasnt just u. S. Stocks. Equities slumping around the world, extending the worst slump since 2009. Blame emerging markets, slowing growth in china, the devaluation of argentines. Peso, you name it. Global markets have been swallowing this for weeks. On friday, enough with enough. Enough enough was enough. The themes we are trading off of our old themes. Chinas weakness, we have expected that, we knew that. Just an overreaction . This is not Extraordinary Movement in the market, we have seen movements like this before. This is gary cohen. Second and secondincommand goldman sachs. We have seen the tenure move about 25 basis points in this move. We have seen normal reaction through growth markets. These are growth markets. They are not developed markets. What about what some markets are calling consolidation . Consolidation is a typical charting pattern. They talk about charting forms. What you tend to see big movements, and then you need to get used to that level of price. You need price activity around that level which is called a consolidation. We had a 30 plus move in the u. S. Industries inequity. In equity. You need to get used to those 30 higher prices and the decide if the world likes those prices, if those prices are too high, if they to cheap . Than the market recalibrate itself based on the consolidation, and that is normal. Fairpoint. Need another reason to relax . Were going to bump it up a notch. Ceo lloyd blankfein. I spend 98 of my time wallowing in anxiety over the two percent worst possible event. Of course these things might happen, if you ask me what is going to happen, i would say that it would be very abnormal if we did not have consolidated moves in the assets that about so much. We have heard a lot from goldman sachs, but lets hear from someone whose business it is to bet against stocks and markets. 30 up, 3 down. We havent immediately we have an immediate panic. Any volatility scares people. They are like, oh, this is the big one. Is this the big one . In the analogy of maybe a forest, we have not allowed it to burn for a long time, and theres a lot of dead kindling on the ground. All it is going to take is a bolt of lightning to set it off, and it will be harder to put out. Is this a sustained pullout, or just a correction . There has been a title shift of sorts. It was easier money, easier money, whether with the ecb, or the bank of china. Now it is not. Is trying to taper. Easier money but less of it. China is trying to tighten. All of a sudden, volatility starts up again and in china you are really seeing bankruptcies. We have one trust that really represents about 4 billion dollars or 5 billion in china. We saw 20 Trustco Bank Corporation last year that went unreported because the news ever gets outside the chinese firewall. Youve have also seen plenty of pullbacks. 10 to be exact. The average decline the street. 8 . Last week made 11 so we will see if history repeats itself as to whether we get another bounceback. Farmed and dangerous, were tochipotle bullys new unconventional marketing play. Speaking of pop stars, Justin Bieber wasnt on the red carpet, he was on a beach in panama after his recent arrest. Justin bieber was not on the red carpet last weekend. He has been relaxing and enjoying the water sports. He is down there with his whole crew from drag rate dragracing a yellow lambeau. Surfs up. . This is lunch money, live on Bloomberg Television and streaming on your phone, tablet, and at bloomberg. Com. Sunday was the 56th annual grammy awards. Music power couple jayz and beyonce opened the ceremony, big winners included daft punk. They won record of the year, album of the year, best pop you will. Duo. Macklemore and ryan lewis won best rap album. This year there was also a unique addition, Queen Latifah officiated 33 heterosexual and samesex weddings. Exchange rings to signal their commitment to one another, shared by the music of love. It was a lot of effort to make the grammys relevant. Here is the president of the wardrobe. Of the award show. I think there is a lot of engagement that is happening way beyond the show, especially with consumers. When we got the grammys six years ago, it was called the grannies because it was not relevant. None of the youth wanted to watch it. Now we have a 65 increase in tune in, and now it is the number two social events in terms of social mentions behind the super bowl. What about award shows like the oscars . The distinction is that we figured out our audience. By figuring out how they want to interact with music and that it is an engagement process, that we got them garnered around the show and all of the events that are happening around it to a much higher degree than the other music award shows do. Billy early joby kicking off his residency at Madison Square garden tonight. Joel kicking off his residency at Madison Square garden tonight. Piano man has performed 46 shows, breaking the record for the longest run by a single artist. Believe it or not, he is just one year shy of being able to collect social security. Billy joel is 64 years old. This guy is not alone. The team here at bloomberg rankings which brings everything which ranks everything from most common chinese surnames, found that 12 of the top 25 music tours had one member over the age of 50. Even britney is getting older. 15 years ago she notched her first number one on the billboard hot 100 with baby, one more time. She is a long way from collecting social security. Thee going to sit down with chipotle cmo. Coming up, we hear about the unconventional Marketing Strategy that is working for chipotle. Secret island coming up later in travel. The seahawks and broncos have landed. A touchdown in new jersey for next sundays new game. Once you figure out a point in your mind, that that youre cold, that is when youll get it. Yet to block it out and get in the moment. . In company, caterpillars forecasting sales that beat the estimates. Theyre are considered a bellwether for the world economy. The ceo tells us what he sees out there. When the world grows up the pace that it has been growing so many years, less than two percent in some cases, it does not allow for any expansion of any employment gains. That is the root cause of all this around the world, whether does the united states, emerging markets, europe, there is no growth. That means that companies, businesses of all sizes and do one thing to survive crosscut. Cost cut. We are trying to do everything the most efficient way possible. We are lucky. We worked hard on restoring our balance sheet. It is the strongest it has been in 25 years. We had about 6 billion in cash last year. In the first quarter, we will b uy about 1. 7 billion. We will announce a new program over the next five years or so for another 10 billion. We are investing, we are pretty well set for our capacity around the world. If we see economic growth, we are ready to take it on. I think a lot of companies are in that same position. It really gets back to a anemic world gdp growth levels. That is what we have to see change before we start investing again. Anemic is not a word we want to hear. Another company in the news, chipotle, known to do some pretty unconventional marketing. They dont do tv ads. Today the company is releasing a four part mini drama that is called a farmed and dangerous. You are feeding cattle petroleum . Nobody was oil in the food change. Sure they do. Theres all of oil. Of olive oil. They pay us to fix their image, not the cattle. Cattle explosion video . Why are my cows exploding all over the internet . Would you say was promoting that video . The young man behind the number one viral video. Im part of an organization committed to farming practices. Why create a video of a cow exploding . Actual security footage. I wonder if we can find some way to get through to him. What are you suggesting . You are my dad. I would never suggest that as her dad. As your employer, however exploding cows, a little weird. Where do they hope it will go . This was definitely uncharted marketing territory for sure. The basic idea is that we believe that more people know about where their food comes from, the more curious they will become and the more likely they will be to seek out restaurants like chipotle. It is highlevel marketing, but to create change and curiosity, and indirectly drive them to the restaurant. This is much less about nearterm traffic and limited time offers, it is about changing the way that people think about food. What are the demographics that are happening that makes this message resonate . For most of my lifetime, people have not cared about what goes into their food. The young people that we think of that are 1434 years old are interested in the environment, in animals, and particularly in the food that they eat, more and more these days. This is marketing that is designed to help them become more curious about those issues. That is the audience that we are most interested in with this particular show. People are more curious about food. Why are you not nervous about criticism that youre opening up your self to potential scrutiny about chipotles own practices . Did that ever crossed your mind coming out with this Advertising Campaign . Most of the advertising that we do in this vein generates that type of criticism, so we expect that. Chipotle is far from perfect, and we are on a journey that we call food with integrity. It is neverending. It may take us forever to achieve this journey. It is about constantly seeking better and better quality ingredients, ingredients that are raised with respect for the animals, the environment, and the farmers. And we are further along in certain aspects of that than in others. It is a journey we are on. We never claim to be perfect and were just trying to change the system we are a part of. How was the advertising changing the actual system . It is not advertising that is changing the system. What is going to change the industry is demand for better quality, sustainably raised food. That is what were after here. As the public becomes more interested in these issues, and actually demand better quality food, that is where the change comes from. The marketing is simply designed for them to become curious about our work. We are just one little restaurant chain. Admittedly, we have a lot of restaurants but but we are not going to change the world. What is going to change the world is demand for better quality ingredients. That is what we are after here. Just a question, sustainably raised food, i salute the goal, and i think it is great that you guys are trying to dig a leadership position in this. It cost more. How do you think of that with respect to margins . How do you think about pricing . Can you raise prices . Do you want to raise prices . Will people pay higher rises for the sustainably raised food . You are right. The ingredients we serve tend to cost more. We spend more on our ingredients that are the restaurant change restaurant chains. It is right about 34 . We spent considerably less on our marketing than other fast food chains. It is important for us to do the type of marketing that we are doing today because it has viral potential. We do a lot to offset the cost of the ingredients, and frankly we do think we have Pricing Power at this point. Leave what we might do with pricing to our ceo. I think people are ready to pay more for better quality and judeans quality ingredients. I do not think it is more expensive to go to chipotle than other places. Event to animated shorts, you have 20 million plus views on youtube. Echo you do next next . Thefar do you take to content push . We have talked about movies before, i am not sure we want to go there yet. Getting this Television Series off the ground was quite an effort. We have been working on this for more than two years. I would like to see more seasons of this particular show. This was just season one of this particular show, but the storyline was written so that it could expand it further seasons. That would be great if we could generate an audience for the show. It is entertainment, not advertising. It has a chance to do that. Willarmed and dangerous debut on hulu. It is not often needed to sit down with a billionaire tech titan alone in a room. We sat down with the global chairman, trying to pick his brain. The easiest way to look for talent is to decide if you like to talk to them. The someone who you meet to you something new . Ityou know everything and onto you anything interesting, why do you want to work with them . Work with people who are curious, do bring something new to the party. I was first an executive, i would watch people blessed really negotiate. Saying that you are an idiot, and all of the namecalling. I decided that that was a terrible strategy. The best negotiations are serious, direct, and representative of truth. If youre not going to do it, say no, but also be prepared for them to accept no. I worked for the smartest Computer Scientist of his generation, and he spoke so fast that everyone elses speech was rated in a fraction of how he spoke. I was always underestimated as a businessperson because i did not have a business degree. With the success of google, that ended. The president s state of the Union Address is tomorrow evening, but washington is already abuzz. Details on what to expect. How the other side of the aisle may react. Call him the snowman. Here is the guy behind the flurries and blizzards in your favorite flicks. A this is lunch money, live on bbg television and streaming on your phone, tablet, and at bloomberg. Com. I am adam johnson. Todays moving pictures now where the video is the story. Activists have taken over a Third Ministry in the ukraine. A pipeline explosion in manitoba over 10sters have taken municipal buildings in the city. A pipeline explosion in manitoba has left thousands of people in the canadian robbins without heat. The pipeline exploded was one of two applying natural gas to the area, and the other one had to be shut down to allow the damaged pipeline to be repaired. No word on what caused the explosion. A longshot wins the 61 the australian open. The 661 shot to win the tournament came out on top. Rafael nadal was hampered by back pain to receive treatment during the match. Tough match. He is forecast to shoot up the world rankings. All eyes are on washington ahead of the president s state of the Union Address. That will be tomorrow night. There is a lot on his agenda this year, from Immigration Reform to raising the minimum wage. A divided congress may hamper his efforts, as it did last year. What we saw last year in 2013 was a washington that did not deliver for the american people. The president sees this as a year of action, to work with the people, and bypass congress if he needs to. We are working with congress were recanted and moving on our own where we can. Going toesident is not wait. Give a pan and phoned he has a pen and phoned and move the ball forward, create opportunity. Lawmakers do not like it. If the president was to give a candid state of the union this week, he will address the fact that his economic policies are not working. They are exacerbating income inequality. They are hurting the people who are struggling the most. If that is hard to get congress to do anything, it takes consensus, but that is what he needs to be doing. The democrats say they want everything, citizenship, everything they can get all at once, or nothing. I think there is an inbetween, where we could find work visas for a lot of people who are here, normalize their existence as long as we do it depended on , border security. There are a lot of things that we can do but the question is do we have to have everything that the democrats want, or what are they willing to go partway . Over the last five years president obama has crisscrossed , the country using real people and their stories to promote his signature initiatives. Were he to look back at some of the workingclass americans that he has highlighted. He might see some mixed results. Six months after president obama signed the Affordable Care act, he stopped to talk about a new provision. He is a hemophiliac, and his medical bills to prevent lifethreatening bleeds could reach 1 million a year ago which was a cap for some insurers. He arty mentioned the issue of lifetime limits. At one not be the rule anymore. He jokes about being the lost poster child, but he was happy to help. When the satellites came out, that is when i started thinking i was a prop, and exposing my medical condition publicly made me feel confident that it was right. He was worried that he might have to rely on obamacare if he loses his job. When i looked on the different exchanges there are , still a lot of unknowns. He is concerned he will not see the same specialist or given get the medications he is used to taking. A lot of providers and plans will not even carry them because they are so expensive. Lets look at the president s housing record. During the crisis, the state of nevada led the nation for foreclosures. The kellers were underwater, but one of the administrations programs helped them save 3000 a year. That savings kept them in their home, and the house is now worth what they originally paid. But obama has not gotten congress to extend the program to help other families. What about the president s a job record . In february 2009, obama paid a visit to the unofficial unemployment capital of the u. S. , elkhart, indiana. Ed, who was laid off just four months before, introduced him. There are too many evil in our community whose way of life is at risk. Too many people in our community whose way of life is at risk. The stimulus helped and brought more jobs, but at 67 he has found work too. He drives his pickup truck to the local Grocery Store to stock shelves, and then is off to a bakery. He ends each day after cleaning a local medical clinic. It is 150 less than what i made in the tractortrailer factory. Even though the glory days are at thing of the past, he feels fortunate. Everybody will ask how youre doing, and i will say i am living the dream because five years ago i could not even find a job, and now i have three. The president s aides say that his speech will love this on income and inequality, and figuring out how to lift up americas middle class. You can watch our special report on the state of the union tomorrow at 9 00 p. M. Enough of politics, lets talk about movies. One of the coldest jobs at hollywood making snow, how it is made. You can find plenty of snow on everest and ice as wind. You can go there for mere 90,000. This is the ski slope style competition from aspen. This is lunch money, live on Bloomberg Television and streaming on your phone, tablet, and at bloomberg. Com. I am adam johnson. Legendary stage and screen actor langella gala frank has played count dracula, richard nixon, and is now playing king lear. Most of us live behind a mask of a persona that is not really just a poor naked wretch as shakespeare would say. We walk around carrying this persona. That happens when you are a king. Youre carrying a crown and it is easier to see. You can catch him at the Brooklyn Academy of music through february 9. But is only a Bloomberg Television, so tune in. Kevin harts police comedy ride along was a win. I, frankenstein was a total flop. It was the only wide release debut over the weekend. Do you ever wonder how movies control the weather, like how you get a blizzard going during a scene . Here is the man who makes the snow. Mother nature is pretty unpredictable. A lot of times when they think theyre going to have snow, all of a sudden she does not come through. We are standing by to make sure it happens. We built a truck all the snow maker truck. We chip and shape block ice at a rate of 800 pounds a minute. It comes blasting out of this hose. And then we paint everything with the ice. That is what snow is frozen particles of ice. Sometimes it is extremely warm, and we need to hold it for a couple of days so we use Something Like and so we use water sculpts or highexpansion snow foam. There are many materials we use depending on the application and circumstances. Tells about using snow honeymoon snow in the movies. Fargo used your snow. Fargo was an interesting movie. About half of that Motion Picture is manmade snow. We were up in minnesota, and they had one of those winters where it wasnt cooperating too well. There are many places up and down streets and fields and parking lots. The academy of Motion Pictures, they gave you an oscar for snowmaking. What did you do for that . Back in the earlier days, the only thing we had as far as materials with things like styrofoam, plastic polyflake, things not good for the environment. There was a time in the 1990s, where we came up with something that was truly environmentally safe, something biodegradable. That also dissolved after a time. We came up with bio snow, and wholeind of changed the direction of the industry to be more conscious about what we put out there in the environment. If you do not have enough cold or snow, you can head to everest, it will only cost you about 90,000. Then we have the other extreme. Sun, sand. I like this. This could be your next secret island getaway. This is lunch money, live on Bloomberg Television and streaming on your phone, tablet, and at bloomberg. Com. In travel from the highest peak , to the deepest sea, were taking you to the extremes. Mount everest is the crown jewel for adventurers. The man who has done it six times will take you, it will only cost you 90,000. Pimm fox asked him how he got into it. Startas lucky enough to climbing when i was 12 years old when i was living in massachusetts. Things just go. You start climbing small thing, you want to keep going. How much oxygen is there at top of Mount Everest echo there is only 33 of the oxygen at sea level. There is this intense urgency to every thing you do, because it is so much more difficult to breathe. You know that you cannot survive there for very long. Talk about the preparation for you and the people that you guide on these trips. That is an essential part of the puzzle. Team members have to have experience and they have to grow on small amounts before they do the bigger peaks because because Everyone Needs to have be a Competent Team member. How do you measure the risks involved . Experience, time on the mountain. We know what we should expect that there, and when things do not fit we weigh those things as they come. The weather can shift dramatically in moments. What do you do . We have a swift team of the urologist that normally forecast for jet airliners but they forecast for us because at 30,000 feet we deal with similar weather as big jetliners. If we do not like it, we go down. I keep talking about your six trips to the top of Mount Everest, but the kind of equipment that youre using now compared to sir edmund hillery, tell us the difference. It is maximally different. Both exhibitions used expeditions use oxygen. But in terms of clothing and footwear, we have such a safety built into our clothing that he did not. He was much were exposed to the elements. Whats what about the cost of the strips . Not only for you, but the people that are traveling . Quite expedition is expensive. It is 90,000 per person. We are small. I think is essential to having the best experience. What does small mean . The most members we would would be nine members, 3 guides and 9 sherpa. Extreme he other sun, sand, and see. Secret islands. Domenica is close to martinique. It is known as nature island. It has the gorgeous oceanic rain forest where you can go hiking, there are waterfalls, so it is a cool place to explore. They have a really beautiful resort there called secret bay. You can take a Puddle Jumper from a nearby island, that is the only way to get there. Say you want to go to andrew silent. Silent andros island. The largest island in the bahamas is less developed than the other resort towns. It is very much a diving island, so if youre into diving or snorkeling we should go to it because it has these sinkholes that you can go into that are completely clear. You dive in and it becomes an underground cave, and there are so many cool wildlife species down there. Is perfect for people who love diving. What about the cost . It can be very expensive, particularly when it is cold in the northern hemisphere. They know that. They make money. The thing is that they are not necessarily because the hotels are not as luxurious, they can run slightly less. The hotel on the main bahaman island runs about 200 a night. That is not actually very expensive. The hotel we talked about on dominica can run about 500 a night. You can save on hotel costs with this but the initial travel in flight, fair, and another ferry might add up. Lets go. You can read more about all these islands on the current edition of boomer business week. For lincoln australia is full this time of year. The annual tuna troughs toss world championship. This thing weighs 17. 5 pounds, like throwing a bowling ball. This is one heavy fish. It is 56 past the hour which means Bloomberg Television is on the markets. I am mark crumpton. But get you caught up with todays action on wall street. This kind of a rocky day early on. The markets trying to regain some of what they have lost earlier. As you can see, a down day on the street. Markets were lower. Nasdaq was down by 1 . Nearly. 5 was down at 1781. At dow jones falling. 25 15,837. Todays fluctuation follow the biggest drop in the fcc this month. To help us make sense of the markets, i am joined by michael james. Thank you for your time. What was behind todays bounce echo i think a lot of anxiety spilled over from thursday and friday. A little unsure of what would happen on monday after they went home friday afternoon. Things did not start out positively in the overseas market. Emerging markets fluent everything. Before more concerned about managing positions, reducing liquidity, and preparing for what potentially could be a further downturn from what weve seen the last two days. Would i continue . Will that continue . Right now it is risk aversion. You told us earlier that you believe that there is a lot of bullish complacency to the start of the year. What do you mean by that . People had ast pretty good 2013. We had a pretty good december to close the year. I think most people in general kind of came in at the beginning of the year feeling like, well, we will probably have a decent market this year. Up 10 seemed to be the predominant opinion. To worry lot of about in terms of q4 guidance. In feeling that they will have a great europe we will probably have a good year again. You had a lot of cold water thrown on you from earlier nowings reports and everyone is going from not really being too concerned with, whoa, now were down 3 in january. I was not counting on this. Fore i should prepare things to get rock youre going forward. About this volatility that we have been seeing since last week, a lot of people say this is just not so much a micro macro event, excuse me, but it is one that is a correction that has been long overdue. Certainly, the market was due to pull back. Its is going to be a shortterm correction like we saw multiple times last year . Several pullbacks lester was meant to be bought. You saw the market kind of shrug off whatever the concerns were and just keep marching higher. Is that going to be the case again . Think it is going to be a little different. Were getting to market concerns that we have not in several years. There is more anxiety because of this. Not because companies had this point versions disappointing earnings. There is no real answer or much clarity. Is this something that ends after a couple days or is this something we need to be concerned about . There are a lot more questions than answers. Were going to have to leave it there. Michael james from l. A. I am mike