Transcripts For BLOOMBERG Market Makers 20150520

There was also the Lilly Pulitzer collection during this quarter. Brian cornell, the ceo, has been focused on areas of the store where they see more demand they are raising the lower end of the earnings forecast for the year two for 50 to 465, that is the range they are looking for. They have presumed buybacks. A target ive hundred 62 million their own stock in the First Quarter in that their first back since 2013. Erik it looks like this is a margin story because target samestore sales came in line of 2. 3 and revenue is in line with estimates. The bottom line is much better than analysts thought it would be. Julie some of that might have to do with the trajectory of target, if you will. Remember they had the big data breach that lost a lot of customers. Not just because of that but because of the target actor was waiting to some extent. The company is trying to get that back and they are looking at the data breach and they may not have to be discounting as much to get shoppers through the door. Erik thank you very much. We will come back to that story. Stephanie they had a good quarter but its hard for me to get that much credit to the Lilly Pulitzer collection and they did that much for the store . Erik thats what motivates people. If it drives sales and those sales are highmargin, fantastic. Stephanie thats what may target special eight years ago. They were one of the first extorts to do those collaborations and it has worked for them. How about some headlines now . How about five of the Worlds Largest banks will be paying the price today. Just two hours from now the Justice Department is holding a News Conference on that investigation into currency rating. The banks are expected to get hit with several billion dollars of fines. Among them citigroup, jpmorgan barclays, royal bank and ubs. Ubs will also pay more than 200 million to settle a case involving Interest Rate. We will find out more at the News Conference at 10 00 a. M. Eastern. You can watch it here on bloomberg tv and we will be speaking to the reporter first broke that story in just a few. It is now the biggest auto recall in u. S. History. The japanese airbag maker takata im having a hard time is a grain to double recalls. The reason airbag explosions blamed for at least six deaths. They will work with automaker and the highway Auto Safety Agency known as nisa to fix the problem. Takata has agreed to enter into an order and requires the full cooperation of the agency going forward. They are launching a Legal Process that will allow was to bring together auto manufacturers whose vehicles are affected, along with takata and other parts suppliers. Stephanie the repairs will not happen quickly. U. S. Regulators say there are 11 different carmakers and a shortage of parts and it could take years to make all of those cars save. The European Company all to use is expanding into the u. S. Cable market. They have agreed to buy 70 of them indications in a deal that values the company at more than 9 billion. Suddenly they have 1. 5 million customers and more than one dozen states. Altice has approached Time Warner Cable about a possible takeover. A person familiar with the matter says talks are at early stages. Altice is controlled by a french billionaire. Erik United Technology is looking at potential buyers for their helicopter unit. Among those interested according to the wall street journal boeing and airbus. No surprises there. Sikorsky makes the black hawk millet helicopters and marine one. We are about to reach the age where they are investing and help support u. S. Stock rises. Citigroups equidistant strategy equities has because people move into saving years between 35 and 39. The millenials are most of their. They will surpass baby boomers at the largest u. S. Population group. There is no bigger story than the settlements coming hours been out and currency and Interest Rate manipulation. Ubs is playing more than . 5 billion. What we dont know is how much u. S. Regulators will extract from four other banks. It is possible quadruple plead guilty to criminal charges that they rate affects wrench marks. Lehmann is the bloomberg reporter who broke this story wide open two years ago. He is with us from london. Leon lets talk a little bit about what we expect out of the fed and the Justice Department. This is being driven out of washington. Guest the expectation is as you alluded to just now. Another four institutions from the u. S. And u. K. Will be charged for billion about 4 billion each in their part in manipulating Foreign Exchange over a number of years by a chat room that they used. Quite erik why are british regulators not involved as they have been in previous settlements . Liam we are expected to seek lots of the same misdemeanors outline from the Justice Departments sentiments later today. To be fair they got there early but our expectations in the Justice Department will have a deeper dive and a more thorough look at some of the behaviors we have seen. Stephanie help us understand when we get this announcement and 10 00 a. M. Today, what is in store for these banks future in terms of what regulators are coming after . Liam i mean, you know, they will be guilty pleas. U. S. Institutions will plead guilty to criminal charges for the First Time Since the late 1980s. It sounds very dramatic but actually, the lawyers of these institutions will have negotiated very carefully to make sure that the impact of the guilty plea is fairly limited. In the past, if you pleaded guilty to a crime you might have expected that impact on your ability to do business in a certain place and your ability to maintain business but that does not seem to be the case anymore. We are seeing more Financial Institutions having guilty pleas but it seems to be a cost of doing business and i would suggest that even the fines will be the bigger hit. Stephanie could that be why ubs, after we saw the fine earlier today, the stock went up . Wouldnt one thing you see a guilty plea headline and the company would get hit . Liam to be fair, it has been triumphed what to expect. I think the market will react in as it is expected rather than no negative surprises in there. I do think that, yeah, it is a kind of reflection on the situation we are in one large Financial Institutions admit to fraud and copper a guilty plea and the share price goes up and business as usual. The thing is, the Justice Department, there isnt much further you can go. This is the most onerous, apparently, onerous agreement you can do with the Justice Department and for the banks it is business as usual. Erik keri geiger, that raises an important question, what is the value of the guilty plea if the banks and their lawyers can behind closed doors, negotiate these waivers with the necessary u. S. Regulatory authorities such that it can continue doing business away they were yesterday . Keri we have entered uncharted territory. In the spent every year, we went from no banks on wall street with guilty pleas to eight banks if everybody plead guilty today. We dont know what the consequences are. We also dont know what the department of justice is going to do for the future of regulating and enforcing wall street. If everybody has a guilty plea at this point, what happens at banks have to guilty pleas for three guilty pleas in the coming years . As we all know, there are always investigations happening. There is a debate happening right now if the Justice Department has basically gone a little bit too far with this because now the value of the guilty plea doesnt mean as much. The way that they tie things up with regulators to make sure businesses can continue no matter what happens, even with these lt please, it really takes the question of what is next on wall street. Stephanie essentially, banks will pay these big fines and they are paying to play . Keri it seems that way so far. If they are allowed to operate their businesses and have no basically causes and what they are doing, then although getting a guilty plea is a major, major, big, huge deal for a bank it is really hard to see what the longterm impact of that is. What prosecutors are always telling us on these types of things, these cases are ways it to get banks to change their behavior. We dont want banks manipulating Interest Rates. We dont want banks manipulating foreign currency rates. For not really sure if this will do it and if that is the case what is the department of justice going to do next . They cant keep handout guilty pleas, how did they curb those bad behaviors and rain wall street and . Erik excellent question. Color me a cynic. Thank you both. Bloomberg is all over this case, the News Conference starting at 10 00 eastern we will have much more for you on this major announcement of the course of the next two hours as we beat the drums toward 10 00. Stephanie lets take a look at the five things you need to be watching. Ive got number one, the dollar strengthened to a twoweek high against the euro, ahead of the release of minutes of the feds april meeting. Said do fed officials expect the economy to bounce back from a dismal First Quarter . The strong dollar has been hurting u. S. Exports. We would we will be getting that at 2 00 p. M. Today. Now more than ever, they go through these minutes with a fine tooth home, but when you talk to the big bowls in the market, the warren buffett, who are wrapped up in american flags and loving the u. S. Economy and on the same token, you look at the data and its a matter of time. Erik they just dont matter for the american market, look at burberry for example. Today, burberrys results dramatically affected by currency moves. Whether it is a u. S. Dollar, the british pound, this swiss franc, the yen, the euro it does not matter. Rapid moves in currency great habit for companies. Of course, it is fixed income traders and fx traders who wants to know what the fed is thinking when it comes to the dollar because janet yellen successfully talked to the dollar down a few weeks ago but the implications are farreaching. Stephanie burberry editing pricing so they can normalize the fluctuations because of that week euro, theyve got travelers and tourists taking advantage of this fine and selling in different regions. Do you think burberry wants to focus on that . Well, thats what he is doing. Erik number two, it is all about oil. Oil supply and america is moderating. The government will release the latest data on u. S. Crude inventories at 10 30 this morning. Stephanie, that always has the potential to be a market mover where the Market Makers. Stephanie you know it. Erik we are paying close attention. Stephanie i guess you will just watch bloomberg all day. Julie hyman has number three. Julie we are looking at salesforce, the company will be coming out with firstquarter earnings after the bell. At the tech company is said to be working with two investment banks. I dont know if you guys saw it, but the ceo talking a little smack this morning and he said salesforce is unlikely to be acquired by Large Technology company. He says salesforce is susceptible to falling revenue and weaning pricing power. Analysts dont see it that way. They are projecting the will report the 21 increase in sales this year. Stephanie all right, julie. I got to get to number four and it is a euro plunge. In less than three days, the euro has tumbled 3 against the u. S. Dollar. Erasing one third of its gains ands march. This comes after the European Central bank announced its plan to step up purchases in may and june. Erik maura but we saw yesterday, the European Central bank announcing it will frontload quantitative easing. If anybody is going to manipulate the market, no better way than to do it at the central bank. Stephanie if you are the ecb and continuing to see the euro not work you, then announcing these asset purchases and the fact that the market does not like it has got to start to make you feel concerned. Erik lets talk about greece, number five. The European Central bank, same actor there, meeting today in frankfurt on the subject of a greek banks. The official at the ecb will discuss whether they should be tightening rules on quick access to emergency liquidity assistance. Just a quick read, stephanie, we all know if they cant sort out the situation and grace will hurtle towards in that greece will hurtle towards a bad and if they can sort out the vent problem. Stephanie maybe they got to get real. We are very close, really . Where how . We will talk about burberry again after the break on unfavorable currency move and uncertainty in china. Its not like able like trenchcoats, damn currency. Is the market in trouble . We will find out, next. Stephanie burberry is getting burned by currency volatility and an economic slowdown in asia. Today, the company lowered its full its for your guidance and they are trading down about 5 today. The question we need to answer is what does this say about the Overall Health of luxury market . Lets ask our own editor of bloomberg luxury. Chris, when we look at these numbers out of burberry, burberry has done so well in the last 10 years. Really they got a new ceo, what is this really kospi and what does this say about the luxury market . Chris burberry is the model. They usually are doing very strong and they are doing all right it is just they are getting hit by Foreign Exchanges and by the downturn in the chinese luxury market. Youre making a lot of good decisions and it is a world situation hitting them hard. Stephanie our luxury buyers still willing to pay high, high prices . We are seeing this race to the bottom. Mickey drexler was sitting here and same its the worst time for retailers because people are addicted to discounting. Is this the case and luxury . Chris that is the massmarket. People are hooked on Online Shopping and discounts. In terms of luxury, there are still markets out there. Some companies are doing very well, particularly in japan and north america. Erik this raises the question to me about burberry and china. We have seen a Luxury Brands hold up so well in the face of slumping economies in the post crisis world, so is burberry really doing that well if they cant keep chinese sales moving at the same pace . Because why wouldnt the Chinese Market be as resilient as other luxury markets have been . Chris its a cultural thing, a tax thing. I think burberry was later than some other companies in terms of changing International Pricing. Chanel got there first and now burberry is doing it. Erik how did they change International Pricing . Chris they lowered prices in china and raised prices in the United States and britain. Burberry is based in britain and it is strong and the top situation to be in. Erik to adjust pricing it has become the game . Like rolex doesnt do that. Chris some of the resale watch brands have had trouble and trying to adjust. Stephanie when you think about all the tourists that take advantage of the price cap because of currency fluctuation, youve got to Pay Attention. Why is it though, when i look at france like hermas, they seem to be bulletproof. Erik they are chris they are changing with the time. Erik chris, thank you very much. Chris runs our luxury coverage at bloomberg. When we come back everybody, the count on for the final late show with David Letterman. Bill mary paid him a visit and fellow new yorkers dont want him to give up his spot. Julie welcome back. Today we are talking oil. Its finally higher trying to snap the longest losing streak in two months. Wti has fallen for five sessions, plunging more than 6 . What is the best way to navigate these volatile moves . Joining me from joining me is a scott, Senior Market strategist at trading advantage. Scott, we had this fiveday losing streak snapping at the moment. Of course, we get Inventory Data at 10 30, do you think oil will be able to stay higher . Scott actually, julie, the pressure has shifted not to the downside a little bit. We recently have seen the long oil short dollar tree be on the last few weeks and that has shifted now. I think of we see the eia data come out with any kind of increase in supply here, there is going to be continued downward pressure. We had the rollover of contracts yesterday, so to contracts ended yesterday and only extended volatility in the marketplace. Oil up a little bit this morning but the pressure is to the downside now. Julie in the direct expectations that we will see a supply in that inventory report . Scott i think we will see a slight build but it will be a slight builds. If there is any build at all. I see downward pressure and actually, i know it is far below , almost 10 below, but really 53. 5 to the 54 area is the next critical level of support here. I would not be surprised if we trended theyre going into the long coming weekend. Julie given that you think oil will go down toward that level how exactly are you playing that . What is your trade to take advantage of that bearish position . Scott julie, i actually like to look into the uso etf which is the u. S. Oil trading fund. It is so liquid. I am a plane actually some of the downside in there. They are around the 19. 5 strike or so. U. S. Oh is trading about 19. 80 or so. You can go out to weekly options, regular monthly, one month out or so. I am playing the downside there. Looking at the crude futures really 53, 50 is the level here. If we approach just above 59, 59. 5, that definitely would be a place i would be selling and shorting the contracts. Again, 53. 5 54 is my target area. Julie scott, i know by virtue what you do, you look mostly shortterm. If you are looking further out, we had Goldman Sachs coming out and saying toward the end of the year, we could see oil coming down toward 45 once again. Does that seem like a reasonable scenario to you . Scott that almost seems like the area the capitulation area that we saw six to eight weeks ago when it hit down there, i really think that the 50 to 60 range is probably where we sit the rest of the year. I think if anything, the trend will be more toward 50, 40 five i think would be extreme. I am not want to fight Goldman Sachs but we are looking at the charts and looking at volume. That was really more or less the capitulation area, so 50 to 55 is probably more likely. Julie thank you so much. Scott bauer talking oil with us from chicago. Erik thank you. Time to catch everybody up on top stories. The u. S. Government is cracking down on five of the worlds biggest banks accused of breaking currency and Interest Rates. About 90 minutes from now, we will find out more and the banks are expected to pay a total of several billion dollars in fines and penalties. Among them, citigroup, jp morgan, barclays, world bank calling, and ubs. Ubs has already disclosed its exposure. They are paying more than 200 Million Dollars to settle a case involving Interest Rates. As i say, we will find out more. There is a News Conference by the Justice Department coming at 10 00 eastern time. You can watch it right here on Bloomberg Television. It may take years to fix all the cars involved in the biggest u. S. Recall ever. The japanese air bag maker toccata has agreed to double the number of u. S. Cars being recalled to almost 34 million. Those airbags have been blamed for six deaths. Regulators say because of a shortage of parts, drivers may have to wait for years to get the cars fixed. Stephanie wall streets number one girl, Elizabeth Warren wants congress to play hardball on that asian trade deal in an exquisite interview with bloomberg tv, senator warren said congress should demand that president obama release release the draft of the deal before he gets fasttrack approval authority. The president has criticized senator warren opposing the deal but says it was not personal. Echo wawrinka go to that sentence. Elizabeth warren this is about protecting American Workers about protecting americas ability to write regulations for health and safety, regulations for the american people. Stephanie warren has become the democratic partys most prominent critic of that trade deal. Those has come out secondbest in the spring battle with home depot. The home chain posted Quarterly Earnings that missed analyst estimates. Those cannot send off a home Depot Campaign that involved instore discounts and online promos. Those are your top stories of the hour. Erik latenight fans, tonight is David Lettermans final late show. It will be his 6028 show and he promises lots of surprises. Last that was not an exception when bilberry paid letterman a visit, jumping out of a giant cake. Bilberry spoke about filming classics like patty shaq. Caddy shack. Things appear to get sloppy with them together. I dont know if that is right, dave. I appreciate the sentiment but one wonders if it is the vodka talking here. Well, we will find out. You have had the heads of government, George Clooney was here. You are here. Im here. Everyone is trying to get you to stay. We want you to stay and not give up. Just one more, dave. Stephanie we want you to stay and not give up. I want to know how many people watch that animal watch tonight live, late at night. Or how many will watch it the next day digitally or online because that is where we are moving. When i was a little kid, my mom and dad watch those shows at 11 30 at night. I dont know too many people that do that anymore. Erik i agree. That is why it shows like letterman dont seem to resonate as much as shows like fallon does today. Stephanie jimmy fallon creates content that goes viral. Erik kimmel does the same thing. Stephanie kimmel does the same and that letterman leans back listens and lots. Erik thats why it works. Because you do stuff you can monetize outside the box. Stephanie then maybe it is daves time to go. We will be back with more. Stick around. We will be talking about debate over trade. Erik today, the Senate Resumes consideration of a measure that would provide fasttrack trade authority to president obama. Democrats have been opposed to this bill. Among them, massachusetts senator Elizabeth Warren. Senator warren spoke with Bloomberg Television yesterday. Elizabeth warren i really dont understand. For me this is about core issues about the problem with this trade agreement. One big part of it has been the lack of transparency in the whole process. We are being asked to move these trade deals forward. Without showing what the trade deal is. Erik for more on this trade bill, capital managing director and former commerce secretary wrote an oped in the New York Times about this issue entitled free trade is not the enemy. Bill, thank you for spending time with this. It is obvious to everybody that the president is having trouble persuading democrats including Elizabeth Warren to get onside when it comes to the Transpacific Partnership and fasttrack authority. It is this the debate about ideology or fax . Bill you have got to separate the trade Promotion Authority and the ability to move forward with the trade agreement and bring it to congress for another and down vote. I think someone can honestly vote for tba, give the President Authority and landed this agreement, if an agreement is finalized to see that agreement and make a decision that they dont like it. To deny the President Authority to bring this if he ever gets it finished, to the congress for an up or down vote and not have months and months of amendments being thrown out and tearing this thing apart because it is a negotiation of 17 countries and you cant come to an agreement and then say to the parties you negotiate with, well, this may all be changed by 535 members of the congress when we put it forward. That is just not going to work so i think youve got to separate the tpa in some ways from tpp. Give the President Authority to continue to move forward. See if we can get a deal. And senator warren and others talk about environmentalists and labor issues, no president has been more forward on environmental issues, labor issues, much to the consternation that we view from republicans and some democrats. He has been there on those issues. I think he will have an agreement if they reject that will be very different from nafta and other trade agreements. Stephanie can you actually walk us through what that difference is between the tpa and tpp . There are Many Americans out there who dont understand the details but they are backing Elizabeth Warren because they are concerned that if this is fast tracked and passed, it will take jobs away from the United States and make it easier to do business with asian countries. Bill what they are trying to do and what trade agreements try to do is open countries who have barriers to our products. The United States has been open from goods around the world and our economy has benefited from that. Have there been job losses over the last 30 years or 40 years because of technology, because of mobilization of the world . Absolutely. You cannot roll the world back. The Economic Growth in the future is in the developing world. Not in the developed world. If we have an opportunity to grow our economy, it is going to be because we can go goods and excel goods and services around the world and country that historically have barriers to our products and services. Is it all to win, win . Not always. It is not a win win. There are opportunities and challenges in trade agreements. As there is of globalization going on but you cant turn the clock back. Stephanie bill, is the president s mistake or dare i say failure, that he simply has not been able to lay out, for the american people, what specifically tpp is . From those who i have spoken to who know it, they say this is a nobrainer and very good for the u. S. Economy but those who dont know the details are thing i need to hang onto Elizabeth Warren, she is going to save my job. Phil when you negotiate with 17 other countries, you cant totally in public. If you are negotiating a deal with the company, you cant do it publicly. You can do this on cspan or on bloomberg. Its not going to work that way. Youve got other countries who also have their internal issues where their agriculture issues manufacturing issues that they have got to deal with and they have got to make judgments over onto labor rights, or environmental issues. It is not in all a total secret they have access to see what has been done so far but in tpa, this congress has demanded they will demand if they pass tpa, that this agreement, if there is a final agreement, must be out for at least 60 days for discussion debate and then move forward. I think its an honest position if a member of Congress Says i will give the president the authority to try and get a deal done, but i will hold judgment on whether or not i will vote for the deal when i see the deal. I think that is totally honest and the right to do. If they denied this resident the authority, he will be the first president , other than richard nixon, since roosevelt who has not gotten fasttrack authority and i dont think that is right in this difficult economic time. Erik what about the specific criticism raised by Elizabeth Warren, that the treaty the Transpacific Partnership if signed, would allow for a backdoor be right of the doddfrank because the treaty would supersede congressional legislation. Bill well, i have not seen the agreement, obviously, or proposed parts of the agreement. But the thoughts that this president would undercut doddfrank which he proposed and fought or in which he has quite frankly, taken an enormous amount of heat from those of us who are in the Financial Services sector is totally ridiculous. Erik what why is it ridiculous . What if he has been persuaded by some of that criticism . What if he is decided for himself, yes, i signed that bill. Yes i think some of the criticism is valid and perhaps this is a way to allow to give something, if you will, to some of those critics because they have a point . Though i know this president. I spent a year with him as chief of staff. That is not in his agenda at all. If anything, and you reported earlier about the actions being taken today by the Justice Department on the banks i dont think this president would do anything that would undercut doddfrank and the ability of our regulators and our system to approve the Financial Service sector. I just dont believe it. I know him and he is not going to do it. Other precious . Obviously. The thought that this president on his own in an agreement undercut doddfrank and that which he fought for, is just i dont believe it. Erik we wanted your opinion so badly and we thank you. Bill daley. He led the negotiations or led the fight for the north American Free trade agreement. Thank you, bill. Stephanie i agree with phil. He is not going to try and turn by doddfrank. Maybe he needs to get a little bit of the clinton in him and get people in a room, talk them through ideas and get them on the same page. Maybe. We will be back in a few. Homer bloomingdale ceo will be joining us. Former bloomingdale ceo will be joining us. Erik time now for top headlines. Five of the worlds biggest fans will have to pay billions of dollars to settle an investigation into currency rigging. Citigroup, jp word jpmorgan, barclays, bank of scotland and ubs. Ubs is paying more than. 5 million in total for the case and a separate case involving Interest Rates. We have not yet heard from the other four banks. We will find out more at the Justice Department News Conference at 10 00 eastern time. You can watch it live on Bloomberg Television. Meantime, we are revamping the product line is working for target. They posted firstquarter earnings that beat estimates. Target ceo ryan cornell has tried to get shoppers into his store with exclusive merchandise such as the Lilly Pulitzer collection. Target said Children Products sold especially well last quarter. Hillary clinton has broken her media silence. The president ial candidate has not answered questions from reporters and yesterday in iowa, she did. She was noncommittal on the trade bill and dismissed criticism of her familys foundation and defended the millions of dollars she and her husband have made it in speeches. President Hillary Clinton stephanie we will be asking could it do the same to online video . We will tell you about spot of five next man. About spotifys possible next plan. Stay with us. Stephanie stephanie welcome back. I stephanie ruhle. We are talking facebook and youtube. Watch out, there might be a new player in the video space. According to reports, spotify will launch a Video Streaming Service at an event later today in new york city. Brendan greeley is all over this. I did that myself be. Spotify will be watching this sounds we are listening to, will be will we be watching those on our phone . Brendan very likely in addition to that, spotify has been in talks with fox viacom vice. Not just to produce music videos but short videos that will go on spotify. Sort of listening to something on your phone and watching a program are different behaviors, so i went to understand better. Erik its a new business for spotify. Brendan heres whats going on streaming. Stephanie who . Brendan right iraq. Spotify has video google bought songza and you have been moving into audio and streaming at the same time. There has an pressure from the labels to keep the Monthly Subscription price for streaming music at 10 and that seems to be a hurdle for a lot of people. Stephanie does this mean that spotify could be a takeout target for google . If google has a place to put youtube, if spotify is going to get into shortterm video space, who is the best added . Youtube, why would this not be a move for google . Brendan five years ago when i wrote about spotify i talk to kids and how they watch music and even when spotify was available, they went to youtube. Right now, spotify is fired at 820 billion and private. Goldman just got in on the action and so did the Sovereign Wealth Fund of abu dhabi. There have been going to financing rounds. They were supposed to go public but its off the public. Its off the table. Erik it was spotify looking at and saint we went to be more like them . It could be used to but i wonder because primaries are pivotal but brian was on the best of the weeks ago say, you know what, by my calculations, youtube doesnt actually make google any money. Seems to me like one of the greatest acquisitions of all time but it has not paid off. Google cannot monetize youtubes video content in a way that actually improves the bottom line. Who does spotify really want to be . Brendan i profiled the founder of spotify four years ago. Shortly after they launched, he got a call from shaun parker that sean parker. I think he really believed that spotifys model is spotify. I think that he thinks they will own audio and video streaming, and we know last year, it the Digital Music caught up to the physical good market last year. We are also seeing apples model where you sell physical copies of the music that lost a percent last year. Streaming is the future. I believe that spotify thinks they have the best technology and they will own it. Erik i like spotify. As usual big calls on the street this morning. Scarlet fu is here with some analysts action you need to know about. Scarlet specifically has to do with alibaba because yesterday they reported that an irs official praises questions on whether the company can go forward with its plan to taxfree spinoff of alibaba. Specifically what the irs officials that is the government is looking to perhaps change roles on these taxfree corporate spinoffs. They are recalibrating the likelihood and of the taxfree spinoff. Some of them are interesting proposals. Anthony diclemente says yahoo could spin out the core business , leaving behind the business with the untaxed asian assets. That alibaba shares. Erik that was actually in the letter that they wrote to yahoo , the very first letter. Scarlet that was one of the options. The thing is, its not as clean and operating company would probably be taxed upon the spinoff, so that is not ideal situation but you get the separation of the two business is without the alibaba tax. That 40 tax rate which is what everyone is looking up because yahoo was going to distribute 384 million alibaba shares and that is worth 34 billion as of yesterday. Erik what are other analysts saying . Scarlet theyre saying it is unlikely this is how the irs would communicate material used to the investment community. Some senior technician reviewers picking at a d. C. Bar Association Event is probably not how the iris will go about it. Having said that, this is a buying opportunity according to rob peck because they would get the core assets for free, so he says going into this about 41 a share which is almost where yahoo closed yesterday, just below 41. You have already priced the worstcase tax rate scenario. Erik alibaba bouncing back, up two dollars. Thank you. Chief market correspondent scarlet fu. Announcer live from bloomberg headquarters in new york. This is Market Makers, with Erik Schatzker and stephanie ruhle. Erik good morning once again. You are watching Market Makers on Bloomberg Television at our new time. I Erik Schatzker. Stephanie i am a stephanie ruhle. We have a lot happening all day. The Justice Department making an announcement about settlements totaling billions and billions of dollars. The banks involved, some of the biggest. Citigroup, j. P. Morgan chase barclays, rbs and ubs. We will get that an announcement at 10 00 a. M. On bloomberg tv. Erik still a developing story and needs our focus. Ubs repairs to plead guilty with a fine of 342 million. This comes with four other banks that are ready to settle for 1 billion each for asset manipulation. Airbag maker to got to agree airbag maker to conduct the grain to the largest recall in u. S. History. The recall will almost double. Yahoo down today. A rule change that might complicate alibaba, the move could affect the existing plan for a taxfree spinoff. Saturday night live. I am colonel sanders. And i am back, america. Stephanie in other top stories right now, policymakers at the ecb says a gets tougher every single week. They are discussing today whether to tighten rules on greek banks account on the ecb as a lifeline. Central bankers are aware of the get if they let banks get in trouble, you could make a political crisis over greece worse. The greek government is trying to work out a deal with european leaders to get the rest of the bailout money that has been promised. Erik the European Company altice is expanding into the u. S. Cable market. In the deal, the buyers could total more than 9 billion. They have about 1. 5 million customers in more than one doesnt states. It is controlled by french billionaire. Stephanie speaking of cable, the chairman of Liberty Global things they could have an ideal partner. He believes vodafone would be a great fit but he did not say whether they are in official talks. Vodafones market fight was 93 million bucks and that is slightly more than double liberties global valuations. Erik revamping the product line appears to be working for target. The discount retailer posted firstquarter earnings that beat analyst estimates. The new Ceo Brian Cornell has been trying to get shoppers into target stores with exclusive much and ice such as the Lilly Pulitzer collection. Targets as children product sold especially well last quarter. Stephanie los angeles has become the against u. S. City to raise minimum wage to 50 an hour. The increase will be phased in over the next five years and expected to boost the salaries of about 800,000 workers in l. A. Seattle and San Francisco have approved similar pay hikes. Los Angeles Chamber of commerce opposes the room the role saying it should be based in in a longer period of time. Erik the draft pick impact on auto industry. Barclays eight sales could drop 40 in the next 25 years. The study finds families will cut back to one car because its self driving cars would transport each Family Member during the day. The result, ford and General Motors would have to slash output to survive. Stephanie president obama goes from tweeting newbie to twitter record setter. Watch out, rihanna. Right after getting his potus account, he reached one million followers in five hours. Thats lashes the mark set by Robert Downey junior. He needed 24 hours to do it i guess that means the president is stronger than a superhero. Those are your top headlines for the hour. Erik lets return to our top story, the government crackdown on five of the worlds biggest banks accused of rigging currencies and Interest Rates. These banks are Citigroup Jpmorgan barclays world bank of scotland, and ubs. Keri geiger with us. It is understandable if people out there have Bank Settlement fatigue. We have seen settlements and Money Laundering over Mortgage Market manipulation. Now its about liable and foreign currencies. Why is this important and why should people care . Ker i this is a pretty historic settlement. We have five thanks huddling on all one day which we typically dont the. In the period of a year, we have had no banks on wall street with you to please on their records now eight. We will probably have five today. We will find out more at 10 00 when the doj has their press conference but this is uncharted territory for wall street. It is also uncharted territory for the department of justice and the bank regulators. It is hard to see what is going to be happening with the banks and with a nintendo collateral consequences. The regulators unprecedented collateral consequences. The regulators will want to continue operating business as usual and tired the deals. Thanks probably are probably not going to have disruptions in their businesses. That calls into question, what is the point of going down this road and how much can you change behavior . If it is just a as usual at the end of the day. Stephanie we spoke to traders and thinkers and some of these institutions and they would say im guessing, sure, there were individual guys and you could find their instant messaging chats and there was wrongdoing there was foul play, so why has department of justice decided to go after the banks and not the individuals . In this case, you can actually find those specific in dual individuals doing this . Jkeri thats a great question. We need to find out what individual charges will be. Are people going to jail . We are expecting people to get charged on fx and quite frankly i think there has to be charges to make sense of this historic settlement. Erik let me bring in New York University school of business who specializes in antitrust and regulation. Rosa 2. 5 years ago, i spoke to randy brewer, he at the time was the assistant attorney general and he outlined, at that time, why the government hadnt pursued the criminal charge against hsbc. The government got 1. 9 billion added hpc but declined to go criminal because of the Collateral Damage. That is what they were worried about. What has changed in 2. 5 years at the doj has gone from worrying about Collateral Damage to having absolutely no fear of charging as many as five thanks on monday criminal he . Criminally . Rosa good morning and thank you for having me today. August the, i dont know what exactly what is the reason exactly the doj decided to pursue but my guess is that the doj may have been founding finding that this type of behavior is widespread across institutions, widespread across benchmarks and it has been going on for a long time. We may be talking about a whole lot more than prices on fx. Given the seriousness and the extent behavior, that may have triggered a change in policy by the doj. Stephanie could the cynics say the reason the doj is going after the banks and not the individual traders is because they cannot get these kind of a dollars from individuals but they can find these banks billions . Rosa yes, that may be one of the reasons. Another reason may be that it may have been found that the banks did not have the inhouse programs and compliance to be able to detect this type of behavior which they may have been presumed to have. By not attempting to detect, by not supervising these types of activities, the banks may then be responsible at the end of the day for the behavior of their own individuals. Erik lets talk, rosa and kerry, about what changes, if anything. Lets say these things get charged criminally but at the same time a, they obtain waivers from other regulatory agencies that allow them to continue to do business in just as they are today. What value is that . K keri i think you have two interesting points, you have bank of america and wells fargo as outliers. It could be very difficult to get clients to change their banks, particularly large institutional clients at the could be a way to pull clients out, particularly if a bank like jpmorgan or citigroup, two of the largest banks in the u. S. Got a second guilty plea. We have no idea what happens if the bank gets another one of these. Repeat offenders typically get harsher sentences. If you get to convictions, you get a harsher sentence the second time. We dont know if that could happen, so there could be some client draw on this. Stephanie when we see hedge funds in terms of what they think on these clients, they are looking at whether or not they want to giant by jpmorgan or citibank. I have not heard from a single client same that guilty plea means i will not do any more highyield business with jpmorgan. Keri i dont think that discussion has come but it is an unknown we have right now, particularly with the entire erik rosa, very quickly, you look at this, guilty pleas, business as usual, what do you say . Rosa i say this is very worrying. It is important to have the guilty plea so we all know Financial Institutions are subject to the same roles that everyone else and they are not immune. On the other hand, it is concerning for those who believe, as i do that we are finding that financial benchmarks that are relevant for many of hundreds of millions of dollars of transactions and contacts that may have been systematiccally rig and that is a concerning finding. Erik thank you so much. Coming up at 10 00 this morning, the Justice Department announcement of these settlements and possibly those criminal charges. Stephanie still to come, greece has until the end of the month to and the stand up with creditors. Two end the stand up with creditors. Stephanie welcome back to Market Makers pickle a live shot in new york city and we are talking europe greece in fact. Crunch time for grace and eight is surprising that they have not been crashed. Crunch time for greece and it is surprising that they have not been crashed. Policy makers are meeting today to discuss greece aid. They gave greece just 12 days to reach a deal and at the end of this fourmonth standoff between greece and creditors, we are going to find out if it can actually be achieved. We are joined by very i can green, professor of economics at the university of california and joins us from cambridge we are joined by barry eichengreen, professor of economics at the university of california and joins us from cambridge. We may find out this weekend which of two scenarios develops. Number one that the bank Heads Together and we also have a greek government in which case we will have a deal. Number two, we could end up with capital come in greece capital unfortunate and grace which could end up on restrictions from greek Bank Accounts and no greek exit and a problem that will not resolve itself anytime soon. Erik you have said that a greek exit from the euro would be equivalent to Lehman Brothers squared. That is a bold statement. Why would it be worse than Lehman Brothers . Lehman brothers is the worst thing that anybody has seen in the Financial Markets unless you are 85 years old. Barry i said that back i think european policy makers have been running as fast as they can to prepare themselves. At the same time, look at what happened in the last couple of weeks. Small shops greece is only 2 of the european economy and they can still have very big consequences in markets that are not as liquid as they used to be. In a situation where greek asset would cast a pall over the future of the european union, i think no one wants to go there. Neither the greek public, 75 of which still supports the euro nor policymakers in brussels and berlin. Erik however, those are known risks. The thing about Lehman Brothers back killed everybody where the unintended consequences. The things that people could not foresee or neglected to foresee. What are some of those things . Barry number one, it begins in the balkans, number two, a lot of European Investment banks debt out there that greece could end up defaulting on. A lot of markets that people have only become to Pay Attention would be impacted. Greek exit would be a disaster for grace and it could for greece and it could well still be a Lehman Brothers for europe. Stephanie really . What do you think the probability is . Barry of a greek exit . I think in 2015 it is very, very low because there is widespread support and grace for the euro in greece for the euro. Im not ruling out the possibility of capital controls not ruling out the possibility of restrictions on withdrawals from greek big accounts. Look at what cyprus did in 2013. It did those two things and kept the euro. I think that is still the most likely outcome now for greece. Erik thank you. From cambridge of this money, university of california professor. Stephanie coming up, target is back on track. We are asking former bloomingdale ceo michael goal and he will give us his take on how the retailer is getting shoppers in their doors. Stay with us, you are watching bloomberg tv. Erik coming up this hour, former bloomingdale ceo will be here to continue our coverage of this weeks retail earnings. Almost 2 million College Grads will hit the real world this month. We will talk about the recruiting business. Stephanie lets get straight to the top headlines of the hour. Indonesia and malaysia are coming to the rescue of stranded migrants. They have agreed to take thousands of them in until they can be sent home or resettled in another country. An estimated 8000 migrants are still at sea, many trapped on rickety boats. Some were abandoned by traffickers after a crackdown on human smuggling. Erik American Airlines plans to compete with low airfare carriers. Ceo doug parker says america will not lose customers based on price. A falling feel price has helped discount carriers to up there is an they are completing the merger with u. S. Airways forming the Worlds Largest airline. Stephanie when we return target tops estimates. Erik we are a few minutes from the opening bell. Livedeals former ceo and Bloomberg News editor at large. Michael, i will begin with you. What matters to investors right now . Michael the main event is the fed this afternoon. I love the way are fed reporters handled it. They started saying is the Glass Half Full or half empty . If you look at Economic Data the fed has been observing, job data is pretty good, housing data is pretty good. On the other side, inflation data is a low and the question is, will these show that they are confident that this deflationary pressures have been transitory . That is the big issue for people in the fed. Erik michael, do you see inflation out there . Michael certainly not in the apparel business. It was interesting looking at the home depot numbers that they showed better than a 6 increase and better than the 4 increase in transactions and the average sale was up. I think the good retail is managing to figure it out but i think certainly in the apparel business that deflation has been around for so many years. Stephanie its a problem that good retailers are figuring it out to coupons, discounting promotions which gets people in the store but not necessarily helping their bottom line. Michael if you look at apple, they have no discounts and their earnings and a couple of a couple weeks ago were phenomenal. You have disney with no coupons and their performance was unbelievable. If you look at brands for you have some discounting i heard they had a good report, look at home depot. I think it gets back to some of the great interest and i started a blurb on cocacola giving a talk at a meeting in las vegas a couple days ago. He talked about cocacola in the past as big supporters of things like the olympics, the world cup. Now they want to move those dollars to what they called connecting with the customer. I find it interesting with Apartment Department doors Stores Coming out with earnings. No wood talks about the customer. They talk about product, but no one talks about how am i going to connect with the customer better than i have in the past . Erik lets talk about target. Michael pretty good earnings be by almost 8 . Stocks up in premarket trading. A couple numbers that popped out for the buyback vigilantes, target spent more than 140 of their net income buying back dock and pay dividends. Another number that popped out visual channel sales grew almost 40 , so less than the percent of revenue of really good growth on their website traffic there. Erik what you see . Michael i think target is like pennies. You have to see how much they get back from all they dropped. Everyone decide if pennies are picking up a few Percentage Points but a fact of the matter is they dropped 6 billion in 18 months a few years back. How do you look back over a period of time . I think it is hard to look at those numbers and say, well they really turned the corner. Erik i know you also have your eye on the solar market. One of chinas highflying stocks, up over 500 in the last year, came down crashing today. They lost about 19 billion in market cap. This is after the chairman failed to show up at a annual meeting. There have been questions about this company over the last year. Stephanie he failed to show up at an annual meeting . You need a new alarm clock, brother. Michael there have been lots of questions about the accounting. Here is a stock that got to be bigger than sony, basically. Two Analysts Covering it, there has been a lot of skepticism in the past. The press. It is amazing it took this long for the stock to come crashing down. Erik thank you. Lets go to julie. The market just opened. What do you see . Julie the dow closed at a record yesterday. The s p 500 just shy of one. Keep an eye on the levels whether we see any gains. Im watching the bank, as are we all as we await any news on potential settlement and guilty pleas with the government over the currency rigging probe we have been talking about all morning long. Jpmorgan closed at a record yesterday. Citigroup at a six month high. We are going to be watching, at 10 a. M. , and we hear from the department of justice and officials there, to see if there is any further reaction. Ubs already came out and said this morning that it is going to be paying 545 million to settle those u. S. Investigations into whether it did manipulate currency and Interest Rate as well. The libor investigation. Those shares aree rising because the settlement is smaller than what analysts expected. Erik you have to love it when a bank pays settlement. Michael gould is the former ceo of bloomingdales. We talked briefly with michael regan. Lets talk about what is going on at the higher and of the market. Their disappointing results at burberry. Is it the canary in the mine . Michael i think a lot of people are slowing down in china. Even companies that have good performance in china, it is not coming from the first tier cities, the fourth and fifth tier. Everyone has talked about the issues of china restricting some of the purchasing outside of china the gifting, the lack of gifting, etc. , etc. I think burberry is a class stock and company. Erik why . They havemichael they have not mortgaged their future. We had the same talk last year about Louis Vuitton. Stephanie and gucci. Michael the Louis Vuitton business is stronger. Look at nordstroms, which reported earlier in the week. Business was up half a point, their Online Business was up 20 . That was appreciatively better than the other retailers, the department stores. I think with the Better Stores that have something to offer the customer, that connects with the customer, where there is energy going on, that is apple, that is disney. Erik it is fascinating that you put apple and disney in the same cap. Stephanie they are great brands. Michael they are brands and people want brands. And burberry is a great brand. The growth we had. See out of china cannot last forever. Part of the growth is in europe. You can go to paris and see the lines of chinese waiting outside of the chanel store. Stephanie it is tough these days to retail. When you look at what new and marcus is doing, building a brandnew fax ship store and hudson yards is it a good move or bad one . Michael they probably had a wonderful real estate deal and they are looking where the market is. Bergen endorse is one brand and niemann is another one. I think it is an interesting market. I do not think it is something theyre taking away from Something Else they are doing. How are you going to grow . You cant just grow. Niemann and nordstroms are in a box, is the only way to grow in the outlets . Nordstrom is adding outlets. Stephanie these department stores, people are going in them less and less and are going to wreck way to american eagle, h m, zara. What does it mean for the Big Department stores . Michael if you can create excitement for the customer, an environment where nordstroms has a 20 growth on the Online Business, but also growth in the store business, those two things go hand in hand. An online and instore customer is a better customer than one customer shopping one channel. How do i get to dispel just at bloomingdales get you to shop just at bloomingdales . I want you to be a core customer and have the loyalty. That is what the vp of cocacola was talking about in las vegas. How do they create excitement with the customer. . Stephanie what does the customer want . Michael service. They want to and experience. If you go to disney, you go for an experience. Stephanie going to the disney store is a destination. Michael if you go to apple today and i walked into the apple store at 7 30 p. M. , there were more people there than yankee stadium. Stephanie it was like a nightclub. Michael the experience and connectivity. Erik price . Michael i think price is fair. If i go to a dollar store, i will own it for a dollar. But no one is going to apple for the price or disney for the price. The price is fair. It is not just about price. None of the stores is going to are going to win if it is just about price and products. It has to be experienced. Stephanie dont your daughters love going to the apple store . Erik sure. Stephanie my kids want to go there like an afternoon activity. Erik the question is, how much do you spend there. Michael gould is the former chair and ceo of bloomingdales. Coming up it is graduation season. How easy will be for the graduates to find a job . Julie welcome back. Lets start with the lows. A trailing home depot in terms of its growth last quarter. It is not what analysts anticipated. They came in four cents shy of what analysts were anticipating. During home depot, lowes. The deals at home depot were apparently too good to resist for Home Improvement customers. Lets take a look at etsy. Not doing so hot. The company came out and said it was hurt by currencies, like so Many Companies have been. The company went public last month at 16 a share. It had a huge gain its first day and now it is coming down hard. And Computer Sciences is splitting into two companies. One will look at the commercial sector globally and together well look at the Public Sector in the United States. As part of the split, it will pay its shareholders a special Cash Dividend of 10. 50 a share. Stephanie thank you. Prepare for resume overload. It is College Graduation season, meaning almost 2 million freshly minted graduates will be soon jobhunting. How should the class of 2015 negotiate what is an increasingly competitive job landscape . Read this book, it might help. It is a career manual first firing professionals written by jim citrin. With 21yearolds graduating, havent they already missed the boat . Jim it is different than 30 years ago when i graduated college, when kids try to get a job with entrylevel Training Programs. It is typical now to graduate and then mount the search. Stephanie right here in the office, we have 15yearolds and turning. By the time they have ready, they have seven internships and already have a job offer by senior or junior year. Jim the good news, it is a better market for this class of graduates, but it is hypercompetitive. Harvard has a 5. 9 except its rate to get into the school. To get a job at johnson johnson, metlife, Goldman Sachs, much less google, it is less than 2 . It is brutally competitive. Stephanie are these kids can getting ready . Theyre not doing things that give you life skills or problemsolving skills, as opposed to be interns being interns. Jim it is hard to figure out the right balance of real experience and internships. The keys to getting jobs, whether it is interview s strategies erik i want to know what is different today. Stephanie there you are graduating. Jim that is me at vassar college. At that time, Many Companies came to campus to interview for Training Programs. Stephanie they still do. Jim but the numbers are much shorter. Because of globalization, consolidation, and Competition Training programs are not as frequent as they used to be. There are more companies that look for kids with 24 years of experience. It is tougher getting the first step. Erik so what is the secret . Jim first to have a relationship mindset. Stephanie how is a 21yearold going to have a relationship with Goldman Sachs, assuming they do not go to harvard, duke or princeton . Jim just because they did not go to the schools or the parent is not a ceo of a fortune 500 company, does not mean that they do not have a relationship. They first need to know what they want. An elevator speech. I have been interested in the market since i have been a kid, im interested in going to work for a financial institution, im passionate about the environment, i want to work for a notforprofit. Stephanie iran recruiting at i ran recruiting at deutsche bank. I do not feel interested in that. Jim to get those jobs are very competitive. Kids have to work harder to get your attention. He can do that if they are creative. When i say to have a relationship mindset, it is not just for Training Programs. 50 of the grads we surveyed got their jobs through referrals. You need a snippet of yourself. You plant that seed with your friends, families, friends of friends, fellow alums professors. That is not only chew with your first job, but over your career. I was one of the lucky ones. I was one of the 50 applicants at vassar interviewing for Training Program and i got the one job at Morgan Stanley in 1981. Stephanie there you go. Jim i was lucky. But many of the others started in other ways. They worked hard jobs, started the salespeople,. Erik thank you for sharing your insight and stories. Stephanie and college photo. Erik heres a look at the top stories this morning. Ubs is going to be paying more than half 1 billion in penalties to settle to u. S. Government investigations. This was bank will plead guilty to fraud from it relating benchmark Interest Rates. Ubs violated an agreement that would have avoided prosecution in the first place. They are paying another settlement in a probe. Citigroup, barclays the royal bank of scotland, coming up at 10 00 eastern time. That is in the Justice Department will have a News Conference into the settlement with the five banks. Stephanie and report underscores just how tight household financials are in the u. S. Most americans do not have enough liquid assets to withstand shock, such as the drop in earnings or big expense. Liquid assets include cash or money market accounts that can be accessed at little to no cost. That means they would have to take on debt or tapping to other assets, such as their home cars, or longterm bonds. Erik it is the end of an era. David letterman closes out his 30 year career. More than 6000 episodes. No word on who will be his final guest. All cbs says is that tonights show is going to be full of surprises. Those are your top headlines, folks. Stephanie she must be flawed but that is all we got. That was from the sentiment on from a specific focus group. On Hillary Clinton. And we are going to have on tonight. Butcher guesses and put your guesses in. Erik coming up in the next hour, David Letterman prepares to host his last show tonight. You will hear from bill carter. And the former ceo of Limited Brands will discuss burberry, target, and lowes. I dont shop there. Stephanie no one does. Erik that is the problem. A focus group found that democrats in iowa are behind Hillary Clinton, saying she is qualified to run and has survived it all. Mark halperin is here. Tell us about the study. Mark we do a lot of polling. Focus groups put a human face on what democrats think. Erik or republicans. Mark in this case democrats. You hear democrats be combat clinton, they respect her, they like the fact that she has moved to the left on some issues, they think that she is the only hope for keeping the white house. That they are cynical, realistic about her ethical scandals. She is a strong, confident woman. She knows what she is doing. She is not afraid to step up. She is qualified to run this country. I think she would probably do a pretty good job. What did she accomplish as secretary of state . Secretary of state . I cant name anything off the top of my head. She is not perfect. But she has been in the i4 a long time, in the public s eyes. She has great policies and knows how to get stuff done. Mark we will have a lot more but you get the flavor there. They are skeptical in some ways, they wish you do not have so much secrecy but they are totally invested in her because they are smart, a think she is the only one who can win the nomination, the only one who can keep the white house in democratic hands. Stephanie as they said, they dont like that she is captive to big money. Last night, you and john sat down with one of the clintons favorite bigmoney men, mark lazari. Is it a positive or negative but they have him in their corner . Mark they never want to be outraised. They always feel like they are vulnerable. Theres a chance that republicans will raise more. Mark lazarus thinks that she will be out raised. Mark shes giving a little bit to the left, and i think that is fine. He blew it money to her understand that. Obviously, some people have issues. Mark people in the focus group love that she is moving to the left. They want to more progressive candidacy. She is moving in that direction on immigration. Mark says that donors do not care. We will see. Erik when you hold these focus groups, are you looking for runofthemill democrats and republicans, or Party Activist types who would vote in a straw poll . Mark we look for people who say they are going to turn out at caucus. Theyre not the most activist. It is a representation of the thoughts of democrats or republicans. Stephanie i know what im going to be doing at 5 00 p. M. Im going to be tuning in on todays all due respect to her. It is going to be great. You want to stay here. Why . We are going to be all over the Justice Departments News Conference at 10 a. M. Eastern. We will have that coverage in just a few. Host good morning. Big breaking news this morning. Five of the big biggest banks plead guilty. It will all be announced at the Justice Department any moment. Olivia breaking news. The guilty pleas have been announced. Jpmorgan, barclays, the royal bank of scotland all pleading guilty to currency rating. Ubs will plead guilty to manipulating Interest Rates. We are hearing more about the penalties and fines they are hearing. Julie has the headlines. Julie the totality of the fines, 5. 8 billion to settle with the u. S. Five are pleading guilty to criminal charges. Of the things you mentioned, citigroup, jpmorgan, royal bank