Kicking it off with what everyone is talking about. Just a day after the u. S. And the eu imposed sanctions over crimeas vote to leave ukraine. Vladimir putin launches a counterattack. [speaking russian] crimea needs to be under strong, stable sovereignty. I can only be russian sovereignty. The defiant putin marching through golden doors and opulent setting. He spoke before russias political elite and some politicians who had been sanctioned. Reminds me of czarist russia. Many of the world work under the rule that might is right, not international law. They think it is their privilege to decide the fate of the world. And the fates of those who live in the world. Is Vladimir Putin saying russia did not use might when he put 3000 troops on the ground in crimea . Have we violated something . What have we violated . The upper house of the parliament did give the right to use armed arms in the crimea. It is not as though we brought in troops and arms, they were already there. We did reinforce them, yes. But we did not go above the figures which had been agreed for our armed forces in crimea. Vice president joe biden, along with western leaders, seem to think otherwise. Russia has offered a variety of arguments to justify a land grab. Including what was said today. But the world has seen through russias action and has rejected the logic, the flawed logic behind those actions. That does not stop the nato from flexing a little muscle. Nato Training Drills in northern norway. Soldiers from countries including the u. S. , sweden, canada, and the u. K. Here is what they are up to in the raw. [tires screech] [gunfire] that is intense. Those drills are part of the u. N. Approved exercise response 2014. John kerry weeks ago this is not rocky iv, one other person seems to think this is the cold war. I have recognized him for what he is, he is a cold warrior. An old kgb colonel who wants to restore the russian empire. He himself said the greatest catastrophe of the 20th century was the breakup of the soviet union. We just have to understand him for what he is. Margaret thatcher said, Ronald Reagan won the cold war without firing a shot. We have to show a strong approach to him. That means economically and diplomatically. That means militarily, in some respects. And then i think he will curb those ambitions of his. So, what is the prescription . Longterm, we need Energy Independence for our european friends so they are not dependent on this country that is a gas station masquerading as a country. Second, we need defensive weapons in to ukraine. We need to return to the missiledefense system in the Czech Republic and poland. We need to have strong and severe sanctions on these people, expanding the socalled magnitsky act. The act targeted correct russian officials, banning them from traveling to or doing business in the u. S. It was named for sergei magnitsky, a whistleblower who died in a russian prison. Is the u. S. Doing enough . Here is al hunt on Market Makers earlier this morning. There is not much he could have done. John mccain is right that there is a lot more, early sanctions are rather tepid. The thinking all along was lets do this now, give him a chance, then we ratchet it up. It is an effort to give him a chance if he wants to to back down a little bit. This guy is a thug, no one knows if he will back down. Some people are skeptical. The bottom line is that there is not that much that america or the west can do. On the other hand, it is true that it adds to the notion that somehow obama is not as strong as people would like. It is a conundrum, there is not a whole lot of ways to get out of it. How much criticism from republicans is just campaigning into november at this point . Mitt romney is not future oriented, he is past oriented. Hes bitter that he lost. John mccain is a cold warrior. He is for an aggressive, interventionist, internationalist approach. Whether it is syria, china, or ukraine. That is not any surprise that he has a different perspective than the obama administration. Are a lot of people in washington cold warriors . It seems the Younger Generation is asking the question why does the u. S. Seem to champion democratic expression in other places but what happens on Vladimir Putins back doorstep, we ignore a vote. I think it is going the other way. I do not think it is antidemocratic, it is more of a neoisolationist feeling. I do not think americans want to get involved elsewhere. There is a sense we have been too extended. That might be a dangerous view, but that is a growing sense of the American Public and political community. Gms Ceo Mary Barra doing damage control after a massive recall. Her message is next in motors. Putting up mad back in march madness, we hear from the lead attorney suing the ncaa over pay or play. Kate winslet was honored at a ceremony in los angeles, star 2520 on the walk. [applause] this is lunch money on Bloomberg Television. Also streaming live on bloomberg. Com, your tablet, and your smartphone. I am adam johnson. Today in motors, gm adding more vehicles to its roster of recall. This time, citing faulty brakes, seatbelts, and airbags. Americas second Largest Auto Company recalling over 1. 5 million vehicles on top of the 1. 6 million cars already recalled this year due to ignition switches that can turn off. Gm has been criticized for taking 10 years to recall those cars. As scrutiny intensifies, Ceo Mary Barra is stepping up. She created a Global Vehicle safety position and promoted an executive to run this group. She posted this video on the company website. We have to latch to cooperate while we work to make the recall as smooth as possible. Something went wrong with our process and terrible things happen. As a member of the gm family and a mom with a family of my own, this hits home for me. We have apologized, but that is just one step to resolve this. We mailed recall letters to owners on march 10 and 11. We will send a bulletin to dealers the week of april 7. We will send followup letters to customers to let them know parts are available. We are adding a second production line and our supplier to double parts availability. We are completely focused on the problem at the highest levels of the company. We are putting the Customer First and that is guiding every decision we make. That is how we want todays gm to be judged. Our system is going to change because of this. Were using this opportunity to change much more about our business. The bottom line is we will be better because of this tragic situation if we seize the opportunity. I believe we will do just that. How well did mary barra do . Here is founder of a Consulting Firm for the auto industry. She did great. She demonstrated that she is intent on finding what went wrong and trying to fix it and the new gm will stop Auto Companies have massive amounts of data. They have recalled data and warned today that i can result in a later recall. If they mine that data, they supposedly have been mining that data to get ahead of problems, it is all there to see. They just have to have the internal process to look at the data and say lets fix it. How is she going to fix this . With chain of command. She can make this a priority. In the past, for decades, General MotorsSenior Management came out of the finance business. Their knowledge of how a car works is limited. She is an engineer coming out of the car side of the business, the business of making cars. She has a better appreciation of what a particular problem could mean in the performance and safety of a car. That begs the question, how did gm get into this decadelong mess . General motors was in turmoil in north america a decade ago. Most of its earnings were coming from its mortgage banking business, not from building cars. It was under pressure to cut costs. There was a notion of all parts had to be at chinese costs. They were cutting corners . They were also shedding thousands and thousands of General Motors whitecollar engineers and administrative people. They were given the opportunity of early retirement or simply cut. A company that was under enormous financial pressure. By 2004, people were speculating that gm might file bankruptcy. That is cold comfort for the families and the four people who died. I am trying to figure out what happened from the time they first knew about this to 10 years later. Why wasnt there anything done about it . You had a culture a decade or more ago where bad news never filtered up. Especially when the bad news had a Cost Component to it. As they do more investigation, they are going to find that either people who were in charge were no longer with the company after a period of time and it just fell through the cracks. Some of the memos have blamed to the customer. That is a characteristic of the auto industry. Get letters from disgruntled customers who would complain about a problem with a car. The Auto Companies would say it is the customers fault. That is the kind of attitude that existed at that point. Today, you are dealing with a different General Motors. The u. S. Wants more rules for bitcoin. A top treasury official lays out his plan. When you think of design, you might not think of biology. Using both to cure cancer. That is later on lunch money. The rise of the Digital Currency bitcoin has raised a lot of questions in washington. Is it a currency and currency rules apply . Then there is the issue of bitcoins used for illegal activity. One of the highest ranking officials in the government spelled out what needs to happen to answer those questions. George cohen, treasury undersecretary for terrorism and financial intelligence. Virtual currencies pose illicit finance risks. Most significant is the risk that Virtual Currencies pose because of anonymity. Illicit actors have always sought to exploit anonymity to hide their financial trails, making it more difficult for institutions to detect suspicious activity, identify those involved, and collect transaction records. The basic tools used to weed out bad actors. For terrorist financiers, Virtual Currencies are appealing. The funds could be swiftly sent across borders in a secure, cheap, and secretive manner, it would suit their needs. Sanctions only work if we can detect efforts to evade them and respond accordingly. If a sanctioned entity could use Virtual Currencies to transact anonymously, our sanctions would have a weaker bite. How does the government want to regulate them . Is it possible . Heres undersecretary cohen with matt miller. The existing legislative framework is sufficient for us to address any of the financial products, Financial Industries out there. Including Virtual Currencies and Virtual Currency exchanges. The evolving Virtual Currency environment. I think the regulations we currently have an effect and the guidance that has been issued regarding the responsibilities of exchangers and administrators is sufficient for today. I was highlighting in my talk that we are watching how this industry grows and develops. And the analogy to cash is instructive. The volume of cash transactions compared to the volume of Virtual Currency transactions is dwarfed on the cash side. It is certainly dwarfed in terms of altogether the Financial Transactions that are not Virtual Currency transactions. We had different tools we deploy an different regulatory requirements we deployed in Different Industries and for different financial products. With Virtual Currency, where we are today, we are comfortable that we have the appropriate regulatory tools in places. Just as this industry continues to evolve, we are going to continue to look at our regulatory approach and evolve to ensure we are staying abreast to risks. Attorneys general telling stories to quit tobacco. Coming up in nation. Should student athletes get paid . There are so many other uses. Do you think of it only as a Virtual Currency or as a currency . There are a lot of other things you can do. You can transfer ownership of things. I am not sure Virtual Currency is a currency. Currency has a particular legal definition. I think there will be others whose are swans ability it is to make those judgments. They will weighin on that. Matter. Not really from my standpoint, it does not matter whether Virtual Currency or its seashells or currency. It is a way to transfer value. What we are concerned about is ensuring that this value transfer mechanism is one that we have the appropriate tools in place to address the risk that that particular transfer mechanism presents. Attorney general are telling major superstores to quit tobacco. That is coming up next in nation. And should student athletes get paid . We will hear both sides of the argument, coming up next. This is lunch money on Bloomberg Television. A Helicopter Crash near the space needle killed two people earlier today. The news chopper crashed just feet away from the landmark and was engulfed in falmes. A third person was hospitalized. And relatives of passengers aboard the Malaysian Air jet demand answers about the plane. The executives ended the meeting abruptly, ultimately getting up and leaving the room. A layer of smog has blanketed paris. At one point officials banned half of all vehicles from driving in the city. The Tobacco Industry is coming under fire. 28 attorney generals across the america are pressuring Major Retail Stores and pharmacies to stop selling tobacco products. Cvs announced it would do so, heres why. The ceo said it is fundamentally incompatible with their mission as a provider of health care services. That can killts you. He is one of the attorney generals leading the movement. We have a bit of credibility in this area. The attorney general of the original cases against they get tobacco and in 1998 reached a master settlement agreement, which is still in place now. Were possibly going after big tobacco. They are trying to push their products on kids. In fact here in maryland we are bringing about 125 million in a year as a result of the 1998 agreement. The idea here is yes these are stores that are Healthcare Providers and its inconsistent and even hypocritical to sell tobacco at places where they try to cure people. The real idea is to try to get them to not have access to children to sell their product. 98 of the people who smoke began before they were 26 years old. 90 began before they were 18 years old. The idea is to make it less accessible for young people and not to send this mixed message. Why wouldnt the Health Department get involved saying we want to have a voluntary ban on all these products . They sell cutlery, they sell electric motors at walmart, things that can do harm. When do you draw the line and say why is it a legal issue . The Health Department can do it too. These are deadly and addictive products that we feel like we need to protect the people of our states from. We are able to get education and awareness out there with the platform we have as attorney generals collectively. I am the media past president and we are able to do this, to go after the big tobacco companies. There is a reason why kids get addicted to cigarettes and smoke for the rest of their lives until they die from it. As an attorney general we feel it is our moral and fiduciary legal responsibility to promote this. This is not a lawsuit, this is something we are asking the pharmacies to do. Rite aids response, we appreciate that the attorney general took the time to share their views. We are always evaluating options and programs for our stores. Rite aid offers a wide variety of Smoking Cessation products. What about other products, sugary drinks, trans fats . Heres the idaho attorney general. Tobacco is the only product that when used properly, as it is marketed, it will kill you. Tobacco is unique in that regard. There is about 480,000 premature it deaths per year from the use of tobacco. It impacts our economy and about 298 million per year. According to the cdc, more than 200 teens try their first 3200 teens try their first cigarette per day. How do you fight cancer . With a virus. We will take a look at the company leading that charge. This is lunch money or coke we are streaming live on bloomberg. Com, your tablet, and smartphone. The Bloomberg Business week to sign conference was last week. Meet the man who is designing viruses to help cure cancer. For me, design is the ability to envision and then create that design. The beautiful part about design is the learning that comes from realizing your designing. Autodesk is a tool for modeling and visualization. I am looking at a subset of those tools that could be applied to genetic engineering and cell biology. Many people look at genetic engineering in a negative way. I dont. The more we can grow the things we need as human beings, the more we will be able to keep the world sustainable. I am particularly interested in how we can design living things very fast and very cheap. I have been fascinated with viruses. I have been learning how to use Software Tools and some of these print technologies to go and make viruses that allow us to do positive things with them. I want to see viruses used to hunt down cancer cells and kill them. Looking at life from the bottomup, its actually a lot like the lego bricks in the dinosaur you may have an frame here. By themselves they may not seem like that much but you can make really complex structures when you have these bricks and can assemble them in different ways. By understanding the very fundamentals of living systems, of living cells, we have this Incredible Opportunity to make and design beautiful things around us. That is cool. Watch our design series all week right here on lunch money. Coming up, in sports we will break down march madness. We will meet the attorney who believes College Basketball players deserve to get paid. And a skiing in austria. Competitors are called on to ski and to send with rock climbing gear. And descend a cliff with rock climbing gear. Thats intense. This is lunch money on Bloomberg Television. We are streaming live on bloomberg. Com, your tablet, and your smart phone. Sports are easing into march madness. The ncaa fastball tournament starts tonight. A lot of money is going to change hands. Kyle from Bloomberg Businessweek knows who will be cashing in. It is march madness, which means on april 7 we will have a new College Basketball champion. There will be plenty of winners and losers off the court. Cbs and turner agreed to pay almost 11 billion over 14 years for exclusive rights to the tournament. That is almost 900 games. The tournament draws more ad dollars than the nba playoffs, then the super bowl tv advertising, and the super bowl. Each regional Conference Get a payment from the ncaa of 250,000. Conferences generally pay that money to the schools competing. The payments are spread over six years, so there is a big incentive for schools to go deep in the tournament every year. Last year nike had its gear on 52 of the 68 top teams. This year the teams are undefeated and all eyes are on them and their nike gear. Some 86 of workers say they will spend part of the day checking out the tournament, which equates to 1. 2 billion in activity. Warren Buffetts Berkshire hathaway is offering a 1 billion offer to those who hit the perfect bracket. They dont think anyone is lucky enough or smart enough to go all the way. The fbi estimates americans will illegally wager 2. 5 billion on the tournament this year. With all that money moving around, should some of it go to players . Hes the lawyer that one free agency for nfl players back in the 90s. He is representing a group of College Player suing ncaa for compensation. He sat down with an interview with our very own erik schatzker. Right now most of the players at the top level of football and top level of basketball help the schools earn billions of dollars and what they end up with is nothing in return. Most of them dont graduate. None of them dont get financially compensated. Almost none of them have a professional career afterwards. They end up at the short end. The schools would argue that most if not all of these athletes get scholarships and there is a value to the scholarship. Why is that insufficient . The scholarships the players get, the athletic scholarships, and are not valuable if they dont graduate and get the education that the scholarships are supposed to provide. If you look at the statistics, what happens is most of these players are used by the schools to generate all this money and then they basically are discarded at the end of that process. Who are you fighting for here . Are you just fighting for the top Football Players and the top asking ballplayers in collegiate america . This is about the big business of college sports. That has to do with the revenue of generating sports. Yes we are focused on division i mens basketball and the top tier of College Football. Having said that, most of the players in those sports are not stars. Most of the players in those sports will never have a professional career. What we are trying to do is create a system for thousands of players who are not stars. I think some level of reform is needed. The college is not a minorleague, it is a complete falsehood to go on camera and say that most of these kids dont graduate. The reality is student athletes in College Campuses around the country graduate in a higher percentage than nonstudent athletes do. The premise that the model is in that college is the minorleague doesnt give credence to the College Athletic experience. It is based on a false premise that the College Education doesnt matter to these student athletes. I would beg to differ. The number of student athletes in College Basketball and College Football but go on to play, they go on to play professional sports, its still less than five percent. How about how vulnerable the scholarships are . They can be revoked any year. If you get injured, duke or unc can say see you later and then you no longer have the opportunity to go to college if you potentially got injured. I think one of the reforms that the ncaa has looked at is whether grants ought to be for more than one year. I think that ought to be on the table. I think there is more integrity in the business than we are giving credit for in terms of honoring scholarships for kids who get hurt. The reality is a great number of student athletes going transfer to other places. There is more of that than coaches chasing players off. The first four games are tonight. These are the wild card games that get you into the brackets. Do these athletes get paid . Todays mystery meat. We are coming up on 56 past the hour. That means Bloomberg Television is on the markets. We did have a rally today. Home sales are being revived. And some of the rhetoric coming out on russia and the ukraine, not as severe as some investors had year it did he did talk about the annexation of crimea. There was a rally today led by and thegy, health care, nasdaq was the leader. Lets take a look at the treasuries, as well. We did not see a lot of change today. See the dealsr, move a little lower. Some people are looking for safety in the treasury market. Oil prices rising the most into weeks. T is after take a look at what happened with gold prices today. We had a little bit of a bounce. The biggest decline in two weeks. Interesting, we saw a little bit of buying of treasuries. That theysafety there were not looking for in gold. If you look at where the yen was, you did not see an enormous amount of change. At the dollar is lower against to be yen. It is time for insight in action. Adam johnson has a History Lesson for us. , history doesnt repeat itself but it does tend to rhyme. Time for a little insight and action. Thank you net Davis Research or pointing out the three patterns we have seen before, which are all converging. First you have annual seasonality. The team at Stock Traders almanac talked a lot about this. Q1 and q4 tend to be best. Now that we are at the end of march, it means sit tight. That is the same message coming out of the president ial cycle. In Midterm Election years you tend to be sideways. Until you get the election at the end of the Fourth Quarter and then you trade up. Then you havent heard of this one, not a lot of people turn about this one. The decennial cycle. This is data going back to 1891. If you just look at the decades typically in the fourth year it is midsingle digits. That is my typo, it should be year four. The team has used this cycle congress it to effectively predict markets going back to 2010. You can see their prediction and the actual markets. They have been pretty good. Not exact but pretty close. When in doubt, just go with what is working. Health care has been on top over the past year. If you have a market that is going to be flat and not move until year end, go with what is working, health care. Health care was a great performer today, along with technology. If we continue to rally the rest of the week when we hear from janet yellen, we will see if the market can get in other like a