Tom is italy, the Unemployment Rate dropping more than expected. Imf we have to go to the because it plans to raise Global Economic forecast. Christine lagarde telling reporters yesterday in nairobi, kenya. Chinas gasoline exports may rise 18 this year, according to an Economic Data in the u. S. Employment kicking off three days less claims tomorrow at 3 00 p. M. We have a read on consumer credit. Earnings before the bell constellation brands, monsanto, and after the bell, bed bath and beyond. Lets look at stocks, bomb bonds, commodities. The vi x nicely under 19. Nymex crude distances itself from 100 a barrel. Vix under 13. Winter wheat we did an interview yesterday, winter wheat, the snow protects it. Maybe 20 of the crop is affected. There is brent crude. And the dollar index, a little over 81. That is a big deal. Not like dow 10,000 but it is a big deal. Here is a quick look at the euro. Cristina alesci said flat unemployment. But here is the drop a big through 1. 36. New doubts about European Growth after about of good news. You finally go to italy shopping with he gets there. The Cristina Alesci shopping that is you, you have to go. An eye on a couple of jackets. Has been. Busy day it a lot of focus on las vegas but lets look at the front page. Your scarlet fu. Jpmorgan. Topped 29billion 29ow billion dollars. Big numbers. The latest settlement is 2. 6 billion dollars to resolve criminal and civil allegations that failed to stop bernie made offs ponzi scheme. Of that, jpmorgan will pay 2 billion to the government and half a billion to settle private claims. The st as on the front page that jpmorgan had known about report to failed to authorities. As i have been saying, prosecutors are pushing banks to knowledge that they did wrong. Excuse me continue, i have a throat thing. What happened to you . Tom, take a breather. Alan mulally, taking him off the microsoft short list because he has taken himself out of the running. He says he plans to stay with ford for the next rest of the year and will not be leaving for microsoft. Internal both people. The head of clout computing at microsoft. Insider, ve an the former nokia ceo and he used to work for microsoft before he worked at nokia and now he is back now that nokias handset business has been purchased by microsoft. This has been going on for four months. An long time for an executive search, creating a lot of uncertainty as both we and the wall street journal is reporting, really distracting employees. It puts ford employees at ease. Stock is the doing ferry fairly well since the ballmer said he was going to retire. A lot of people looking ahead. We will continue to monitor that. But the final frontpage page story, airports across the nation, airlines slowly getting back to normal. For anyone flying around, winter storms and subzero temperatures have called airlines to cancel about 11,000 flights over four years four days. How was your experience . Was it one of those nightmare experiences . It was fairly smooth considering united email me and said it was canceled they did book my eightyearold son on a but overall, jetblue had canceled all flights from 17 hours are monday through tuesday to reposition. Fortunately i did not have to go through that. Wouldve been quite an ordeal. Page are our front stories. Lets bring in our guest host for the hour, bob gault, chief equity strategist at nuveen bob doll. And former ceo of enews. Out ofthe latest data europe showing unemployment still a big problem, 12. 1 for the eurozone. I know one of your things for 2014 is the idea we will get the global synchronous recovery. When you see numbers like this out of europe, doesnt put it at risk . Not at all. Europe is recovering but it will be one of the most anemic european why did you tell me to buy stain by spain last month . Wrong guy, wrong guy. No question the u. S. Is still leading the way, but the rest of the world is a bit better. Of this is really important. Bob this is a key question for everyone watching the program. We are all told we need to buy international stocks. They have been out of favor. I am not giving up on the the u. S. When Economic Growth is moving from roughly two to roughly three. You are still on the u. S. Boeat . Yes. The s p 500 is made up mainly from multinationals that gets most earnings from abroad. Where does it leave them . I would rather own domestic content. That, adam, i think the idea of domestic content, your world is one of the great expert vehicles. That is, entertainment and copyright. Where will it be over the next 12 months . Is copyright threatened, and are we still going to have the cliche, content is king . I think content is absolutely king. I think what you are seeing is going to manifest in different formats. Huge growth in video, video online, video streaming, streaming format, mobile format absolutely taking off as but that means if we do that would you watch, Downton Abbey 18 hours a day . If i am streaming, what am i not doing in your world . A lot of music. A lot of this is in the background. It does not always have to be your total focus. So, i think you are continuing to do a whole lot of what youre doing. You are snacking quite a lot. Looking at stuff and popping across stuff. Same thing reading the media and the news. I teach at columbia, the graduate Journalism School and 100 of our students now say thereve primary source of access to ms. Is through a mobile device, the starting point. You smack, smack, and then you dig deeper. Is that the idea of snacking versus dining on a main course moral lucrative for the Generation Company . Bit onepends a little their business model. If it is an advertisingbased is this model snacking could be quite good because you could be refreshing rapidly. Still not getting great cpms the advertising revenue per 1000 i think that is our surveillance word of the year. Snacking davos. I love the phrase. Great to have both of you. A lot to talk about. Lets get to company news this morning. A new obstacle for bitcoin. Alibaba banning the Virtual Currency from it shopping website. The chinese ecommerce giant will stop users from doing deals protectins, trying to interest of its members. It follows a crackdown by Chinas Central Bank last month. Aereo gets more money to expand. 34 Million Dollars in funding to fuel expansion into new cities. It is in 10 cities and plans to add five more by the end of march. Also awaiting a decision from the Supreme Court on whether it will consider a request from broadcasters to shut the service down. Word could come by the end of this week. Is scaling back in china. It was not selling garnier in the country. It faces growing competition from domestic and south korean brands in china. It comes just a week after revlon said it is leaving the country entirely. So muchina alesci doing on mergers and acquisitions. You were one of the first to , reallyme about aereo gaining traction. Very much so. It does not seem like there is anything traditional broadcasters can do to stop this it does not seem like they have legal grounds. This am taking hold. Again, diller guy once disruptive. Yes, that diller guy. Blame a lot on him. Up, pandora shares at an alltime high. Taking a look at the strategy to keep them in your car. And you can watch her interviews on bloomberg and apple tv. This is bloomberg surveillance. Good morning. Good morning, everyone. Bloomberg surveillance. 8 00 a. M. This morning, robert nardelli, always interesting. A lot of executive experience. The view for 2014. Maybe we will see a little bit more combinations across american business. At 8 00 a. M. This morning. This is bloomberg surveillance. Im tom keene. With me scarlet fu has finally returned. The gulf stream is back in the hangar. And Cristina Alesci, get us started. Of things keep changing in the record label and Music Distribution business but one thing was pretty constant in 2013, investors were tuning into pandora, and that continues into he seems to be continuing to 2014. Pandora is rolling out these in car advertising this month to run commercials from bands ford, taco bell. The ceo candela talk to Jon Erlichman who is covering ces in las vegas and this is what he told us. The ad partners we selected to rollout initially were ones that are very familiar with radio advertising. Able to understand the importance of using the captive audience in the automobile and adding on to that, the targeting layers that pandoras first party targeting segments can do, really is an intriguing opportunity for advertisers. When you are stuck in your car, you certainly are a captive audience but it speaks to the strength of local radio advertisement and how big the market is. 15 billion dollars spent annually by u. S. Advertisers. That is so crucial. We will see if pandora can figure it out because it has a lot of competition. Spotify is out there, itunes radio, and people are really looking at the merits of these Different Services and trying to to dedicatehich one their time to experiment on. Us, formerly joins online indie music retailer and all sorts of experience now with his own consultancy. I guess it is a new juggernaut of choices for consumers. What do you observe we are doing with these radio products . The one thing you heard from the cfo of pandora, he is saying we have a way to collect huge amounts of consumer data and then leverage the data to focus on you, to focus ads on you which i hate personally, but thats ok. While i dont see the sustainability of the pandora business model, to be honest, that conversation i think he is absolutely right about. Google radio, apple radio, spotify, theyve got just the same amount of data. They cant use the data to get the music selection right for a lot of the users, which is what the major complaint is for pandora. What is the believe you have the data to make advertisers target customers . Better . I think that is the weakness in the argument. Because their selection of music is very bland, very ordinary, and it is not very personalized, which is what people are looking for. Adam, i wonder, music versus news. The customers willingness to tolerate ads depend on the type of content they are digesting . It depends hugely on who the customers are. On facebook, there is huge push back by people saying, wait a second, i did not come here to get ads but i came here to participate in a social experiment experience. So dont suddenly use the data you got me to manipulate me. A huge pushback. You goother hand, if onto spotify and you take the free service, you expect there to be ads. That is part of the deal going in. So, it somewhat depends on what deal you cut with consumers when you start. Because that is the relationship they develop with you and the brand. You cant switch with a lot of difficulty. One thing is clear, the streaming Servers Services are the winners. Should Companies Stop the Business Models of downloads . Have customers moved away from paying for music that they would rather stream . For the end of last year you did see a little bit uptake of downloads sales. So there is still a market to own a certain amount. The argument that those in streaming have always given is, if you stream, you hear more stuff, and you are more selective than you do buy a certain amount. Very different classes of customers out there. Again, there is a group that loves the top 40 music that came to buy very little music. There are those who love slightly more indie, slightly more a click it, and they tend to buy a little more music. So i think streaming is part of the future. It is a big part of the future. Not only, by the way, in music but also video. A huge part of the future. What do you expect us to do with our time . What i dont get here is where we are going to find the time for all the little stuff . Whereas the time in the day to do that and do all the other stuff as well . I just dont see it. Some of it is multicasting we have used the term for years but if i am listening to Justin Bieber, i am not multitasking. But in all due respect, you are not the core audience for this conversation. S . Not listening to the bieb damn good intense bit like stephen stills. Youre killing me. The king of streaming in all teleplays out, our twitter weston has to do with it. If you are listening to Justin Bieber over pandora and you are trying to watch movies what would you sacrifice for a lower cell phone bill . You are doing a lot on your cell phone. What do you give up . Weet us bsurveillance we are streaming on your tablet, your phone, and bloomberg. Com. , i will not eat no meat or cheese after the show. We are not doing it. This is bloomberg surveillance. Im tom keene with scarlet fu and Cristina Alesci. Are you kidding me velveeta cheese, are you kidding me . We will get that in a moment. President obama is not discussing clemency for edward snowden, according to unofficial. In recent weeks advocates have been calling for leniency. The news comes as the president is close to announcing the limits on nsa surveillance programs. The new rules could come as early as next week. Nbc is looking for a new face for the winter olympic coverage now met lindsay von is out. The download downhill skier is out because of a knee injury from a training accident. A Network Executive says nbc is open to having her provide coverage from sochi, color, terry, i guess. Tom, this is for you. Backup now because the supply of velveeta is running low. Some east coast Grocery Stores is running out of the orange colored cheese food. Quick that is not the proper description. It is not the proper description. It is like a fine gourmet item. They say it is a shortterm issue possibly due to seasonal demand from a football watching parties. Isad no id idea velveeta a seasonal issue. So many things i dont know about football. A tear in my eye. Cheese is not cheese, either. That i recently found out. Whats up with that . Morning mustread, what do you have . Slightly different topic. You can buy the products in your Favorite Television show. It goes back to tv shopping and why it has not caught on. This is from bloomberg view, and she says a very compelling idea for advertisers. Obviously if you could just imposed by the outfit your favorite sitcom actresses wearing, it is pretty powerful. A linkage with technology and commerce. Quickly, adam klein, doesnt work . Am i really going to buy stuff directly off of my tv . Not for a while. What you are starting to see is what they call the second screen. I think that is where it is going to start happening. But on the tv itself we are allowed to have something that fail. What is not failing now is the equity market. What will 2014 bring . Bob doll joins us next. Good warming morning seem more attractive temperatures across america this morning. Im tom keene. Followthrough has returned from the west and Cristina Alesci is with us as well this morning. Scarlet fu has returned. Claims, then the jobs report on friday and bill gross will join me friday on Bloomberg Radio. There is the data. I dont have to say anything. It is there. The euro a little bit weaker off of Economic Growth or reason europe. Scarlet, you have real news. A couple of losers all on the back of sony announcing he streaming gaming service. Gamestop tumbled in the wake of that. Evil necklace cutting it to hold from a buy and netflix stifel it to hold from buy. Netflix down. Also sony streaming game system and this cancer drug developer partnered with johnson johnson, the leukemia trial stopped because it met study goals. Something they like to hear. Get anything off of the bloomberg, folks. That quick. To finish out your holiday shopping, by a bloomberg terminal. Lets get serious with equity material. It has been an outlier call, an easy call for four years, measured optimism has paid off. The bull market has turned my and back to a 401 k made others look like geniuses. 2014 will not be so easy. One senses has taken on the doll view. The legendary robert doll joins us. We got spoiled last year. The market went up a lot in it was a straight line. Hardly any bumps along the road. I think we are going to have an ok year. I think stocks will be up but it will also be a bumpier year. On a weighted average, as everyone consumes what scarlett and i do every day, will we be beholden to chairman yellen or willoughby will companies do . I think more the latter. The fed does matter and the debate on the back cap will be ok, boys. Three percent growth. Percenta half or two inflation, which is five percent nominal, how can we have zero Interest Rates . The question will come, when are you going to raise rates . A bluechip guy. Last year was a small chip year. Is this a year for big stops again . Still not get at think you want to be down cap. Jargon alert, excuse me. Earlier, theing new jargon. Down cap it goes with velveeta cheese that is down market. Are you going after my mother . So, my benchmark is mega, large, and midcap. Im overweight mid, underweight mega, which means i am down cap. Like a morningstar moment. You read a lot of your competitors reports and you put a lot of time into the 2014 investment outlook. What is fundamentally different between your outlook versus the other ones out there . Think a lot ofi people are of the view the stock market is going to be really good this year yet again. Then you have some people in the bubble school, the in between, that you are going to have an ok year but it will be bumpy and you have a lot of picks mr. Ell, as mr. Wein and yet have 10 or 12 picks. One is that gold will continue to suffer. Do you see another down year for the metal . I do, scarlet. Gold was up 12 years in a row. It has been an unbelievable bull. We dont have an inflation problem, the system did not all apart. Both were one of the two reasons people glommed onto gold. Rising dollar, rising Interest Rates and an economy that is normalizing, not great for goinge is the gold chart back to 1950. Thetina, when velveeta boom in the late 1980s, nominal charge. Nothing happens in here and then down we go. You assume we just come down and have nothing happens for 10 years in the gold market . Init depends what happens global inflation in the monetary conditions. I am not sure it will be that quiet, tom. I just think in the near term we are still unwinding i got to have gold because the world will fall apart. It is also the year of midterm elections as well. I lot of focus in washington on that. Congress likely to do less than they got accomplished this year. What is your position on the power . Of i think it is a consensus view. House republicans will gain a few seats, get a few more in the senate but not capture. The deficit is falling every day and we have a dovish fed. Lets go to the technology sector. Adam klein is with us as well. We take Big Technology not twitter or facebook are they going to be part of your world as well in 2014 . The infrastructure, servers, and all of that stuff . Advertising technology, there will be a lot of activity in that area. The infrastructure of your world has got to happen. Within that, how do you play adam kleins world . I think you need a broadbased selection of technology stocks. Tech is a huge it captures all kinds of things. The hardware, the software. Even in the world you are talking about, unrelated to so many other parts. I think you just need a wide swath of them because that is where we are going to get some more spending. Whether it be from the consumer or corporate sector. My theme for this year is a little less fear and a little more confidence. That is good news for spending. That is what the ceo of cisco is saying at ces look at the infrastructure play, we are wellpositioned to run the pipe and manage the networks and the linkages. The macro picture for a second. Im scratching my head because i hear so many good things about this year, about the markets and whatnot. But yet the middle class is will bill has notf fully recovered. Do investors not care . I think they legitimately do because middle classes were all the spending power takes place. Will he be Going Forward . It seems like people are paying less attention. I think they have to the 2013labs spent more in than 2012. They will spend more in 2014 and 13. Last year, 10 to 20 normal above stocks and this year five to 10. On stocks, bonds, currencies, and commodities. Best chart individual investors pouring money into equities. How does it compare to the allocations to bonds and cash . The single best chart was not the same without you here. Im back now. It is all good. His is bloomberg surveillance on Bloomberg Television and streaming on your tablet, your phone, and bloomberg. Com. Bloomberg surveillance. You,e thrilled to tell bloomberg west is on the mistake is a look at the coverage 1 00 p. M. Eastern time onto the evening hours bloomberg west is in las vegas. Us withfu is back with top headlines. News out of europe. Unemployment in the region is stuck at a record high. The jobless rate, 12. 1 last month. It has been stable at that level since april. With Economic Growth rates are forecast at one percent this year and next, economist dont expect a significant drop in joblessness. Dubai plans to crack down on home flipping. This move comes after home prices climbed 30 last year and are forecast to be the same this year. Officials are trying to prevent a repeat of the real estate bubble that burst in 2008 and send values plunging 65 . Sending 800 more troops to south korea. They are part of the white house plan to rebalance u. S. Or says in the asiapacific region. There are more than 20,000 u. S. Troops stationed in south korea, according to secretary of state john kerry. Why do i think we will be talking about north asia this year . Big themes. Finally she has returned. A vacation to the west coast. Xis is best for the y and x a single best chart. Picking up on one of the other big themes, more money going to equities as of as opposed to cash and bonds but it equities make up 60 of allocations versus 64 in november. The historical average is 60 . It sounds like things are getting a little lopsided. But our chart producer reconceived the data on a 100 scale. What you find is the stocks allocation, the light gray university of pennsylvania blue. What is that about . He is a little bit biased. But it works out to be more than the majority. But you look at the darker gray, cash and bonds, and they are Still Holding on pretty well. The light blue line is the s p 500, how quickly it has moved certainly in the last 12 months. From nuveen cash, selby audience on why they should not be in cash . Because it is returning zero. Inflation, negative. If you think the world is going to hell it in a handbasket, i guess having cash in your mattress make sense. What is your alternative if you need cash . You can go into things that have higher returns on a shortterm basis. In other words, combine both parts of your portfolio. I need some growth and any some cash. How about some income bearing what about executive arguments on how they need to be in cash and they will not deploy any of it. I think that is part is part of what is going to change. Bought a lot of stock back. The raised dividends pretty busy i think they will also spend money on capital. Bricks andl mortar. And m a. But if the economy does not grow beyond three percent a year, do they need to deploy the cash and Capital Expenditures . If they see it growing three instead of two, there will be lots of places to put money. Gloves or mittens when it is this cold . Definitely gloves. A glove guy. S Cristina Alesci will have a first look. We will stay with that. Your favorite topic. The weather. To start with lake michigan. This is what it looked like yesterday. Thick sheets of ice. And that is the late. Rink. E a hockey the water kind of froze as it shot up. Crazy. The blackhawks could not skate on that. I dont think i would survive. Degrees. Res of 16 only tom keene could survive that kind of weather. It was cold yesterday. Like on the edge of buffalo. I was surprised and you say it. 10 degrees in chicago right now. The next picture what do we have . Weather. This is in england actually. It continues to suffer from rough weather, predominantly lots of flooding now for over two weeks. This picture is actually the welsh coastline. Flooded towns have been. No scenic driving along coastal routes in wales, which is really pretty. Quigley beach. And then we have chancellor merkel, certainly a trooper. I thought she was supposed to be on bed rest. Apparently she had this injury and she did not complain about it for a while until it got much worse, and now she is on crutches. She is supposed to be not moving it i never had the pelvic thing but the tailbone and hockey i heard this is like that on steroids. Much more painful. Out doingng to be meetings anyway. We need to say thank you to somebody who actually mail 2013, bob doll, thank you for showing up. Dont be a stranger this year. We need the market to go down 400 points to create excitement, the world is coming to an end. We will have some of those days. He is actually calling for a correction. One of the few people. Of nuveen asset management. Coming up, we will talk about tmobile ceo john leger. The twitter question of the day what would you sacrifice for a lower cell phone bill . About 380 a month. A mortgage payment. Weet us bsurveillance this is bloomberg surveillance. Tomscarlet fu here with keene and Cristina Alesci. Lets get company news. Facebook does its first deal in india. Buying mobile Technology Company that develops software that improves the performance of apps running on googles intuit system. No financial terms were disclosed. Sony will launch an internetbased Television Service that will bring live in demand programming two tds and playstation consoles two tds and playstation consoles. Fuel rate 34 million to expansion. It plans to add five more at the end of march. That is todays company news from the files of bloomberg west and. Talk aboutto tmobile. Shaking up the Wireless Industry and not just because the ceo got himself kicked out of a ces party thrown by competitor at t monday night, but because ledger calls himself an tmobile an uncarrier, unlimited contracts, earlier smartphone upgrades and putting others on the defensive. With us from Bloomberg Businessweek he writes about what we really need from a carrier. This guy is making it pretty ugly for at t and verizon. Ellis how successful. He is so consistently strategically wacky that i had to become the chief tmobile correspondent, where chief john leger correspondent. Are you going to follow him around . You sound like he is fun to follow around. For a long time, there was not much effective competition in the u. S. Cellular market. If you look at average revenue per user, it was pretty consistent among the big four which meant they were not really competing on price. Tmobile for a long time, the subsidiary of Deutsche Telekom here in the u. S. Was having trouble getting a foothold in the market. Not get spectrum and could not really pick up customers and did not have a very good network. Going down the tubes. And then a bizarre thing happened was at t attempted to buy them. The deal fell through but as part of the deal falling through 7 billion of cash goes to tmobile as part of the breakup fee and now theyve got the money to buy spectrum. Give them spectrum, which is even more worth. Tmobile build the network and that did something crazy, which is they started dropping prices. It proves the Justice Department was right, in a way, and did not let tmobile merge and has potentially a strong competitor forcing the two major monopolies to do things a little bit differently. Question can the strategy backfire . It is a pretty bold one for him. We will see. Will margins suffer, and other words . He has been picking up customers. But i think all of the carriers are recognizing they can no longer charge anything they want just because they have an Amazing Network here at i think verizon by the sale of its spectrum to tmobile shows that marginal improvements to an Amazing Network dont actually get you anything. So, once everybody has realized that and realizes we are all converging on potentially the same Amazing Network, then they have to differentiate themselves. I dont think anybody why they choice but to get dragged down into a price war with john leger. To your point, people do not want to pay extra for incrementally better coverage. Verizon keeps talking about a Great Network coverage and you wonder how much returns. They expect billion of dollars on it but it is not paying off because ledger could come in and say we are unbundling everything. Giving a choice. Fascinating you are willing to sacrifice a bit of network polity for a huge drop in price. I had a family plan with at t for more than 300. I now pay a hundred and 20 with tmobile for the exact same plan. 120. A slightly worse network for 200 a month. I think it is a choice we are seeing in the numbers. They are picking up subscribers. Was it him or at t to toss john leger out of its party . I feel like the whole thing mustve been scripted like a reality show. It was all over twitter. How he saultweeted john leger being tossed out. He crashed it, still wearing a pink tmobile shirt. Is a big reason why tmobile has come back from the dead. His personality. The strategy is working the personality is working because we are talking about it right now. He gives great interviews. What he said when he got kicked out was, i just wanted to see macklemore. Nothing more. This brand for them is really actually working. He is strategically crazy. He knows a hawk from a hand saw. He knows exactly what hes doing. But it is working because we are talking about how much cheaper than our right now. Adam kline, what do you think about somebody like john legere touting tmobile as an un0 carrier . I also moved family plan for the same reason. In the service is better as well. Yes, i think it does. We are going to be using more and more data. We do want unlimited data plans and and family plans, you have kids, you want unlimited data plans. He has targeted it and understood it and delivering it. A big impact. Brendan, you have something to add . All the carriers have a longterm problem, though. Cisco said in 2012, a third of data went over wifi and by 2017, it is supposed to be half. There is another network competing with the big four, what we are building in our own homes without own routers. Most of the calls and make you make at work when you dependable wifi and at home with the same. It ends up being a really effective cellular network. Brendan from Bloomberg Businessweek. Significant movement on foreign exchange. The yen is not the story. Canada really moves. A weaker canada, from parity out dollar you me dollar loonie. Asia, right on strong you want support. Big deal. Dollar index higher as well. We want to thank adam klein, ceo and media leader. The president sees an improving economy for elites inequality is his economic theme for the year. Stocks, they advance. The job market, too. We will look at the markets in this hour. Exclusive news at t wants netflix to pick up the dreaming make cristinad alescis life happy as she watches 18 hours of Downton Abbey last weekend. That would be very cool. This is bloomberg surveillance. We are live from our World Headquarters in new york. A less frigid wednesday, january 8. Im tom keene. Scarlet fu has returned, flying over the polar vortex to get back. Over, under, through it. And we have founder and chief executive officer of tree. Com, and lending tree. Com as well. Kicked off in europe, because we are looking at Unemployment Holding steady at 12. 1 . Italy standing out, coming in below forecasts. The imf plans to raise the Global Economic forecast pretty that is what Christine Lagarde told reporters yesterday in nairobi, kenya. China has a gasoline exports may rise 18 this year, according to icis. Economic data here in the u. S. , seven 00 a. M. , Mortgage Applications and 8 15 a. M. , adp employment, kicking off three days of employment data, then at 2 00 p. M. The fed releasing it minutes, and at 3 00 p. M. Consumer credit. Before the bell, consolation, men cents, and after the bell, bed, bath, and beyond. Changing of the guard from bernanke and yellen but every nuance of the minutes now is interesting. It is pretty boring text and you end up looking at words like some and several to see if it was in this version. Or is it that computers basically scanning it the computers basically scanning. The computer look at it and you go into the pencil and you circle these strange words. We need to get you a super ax inter so he can just f the fed minutes bloomberg is the supercomputer comparison but you andlooking at several lets look at several stories. The only scarlet fu. At jpmorgan boston legal bill just went up, the latest settlement is to resolve allegations it failed to stop offs ponzi scheme. More than a half 1 billion to settle private claims. 29 billionmount top dollars. You can take alan mulally off the shortlist for microsoft by synnex ceo. He has taken himself out of the running, saying he plans to stay with ford through the end of the year. Who doesnt leave as candidates for the top job at microsoft . Internal guys mainly former no egos ceo, the Cloud Computing okiaf a former n ceo. Bitcoin, alabama banning Virtual Currency from its websites. It will stop users from doing deals in bitcoin starting 2014. It says it is trying to protect the interests of its members. It follows a crackdown on bitcoin by Chinas Central Bank last month. While you were gallivanting around the country, with all zynga going the other way. They will use bitcoin. Las vegas, Consumer Electronics show. One big media blitz. Some actual news came out of it. Pandora announced it will run advertisements in cards. Pandora stock jumped on the news. Told jonancial officer erlichman they already have major advertisers lined up. Here is what he said. Select itpartners we to rollout initially i once that are very familiar with radio advertising. And so, they are able to understand the importance of using that captive audience in the automobile. And then adding on to that, but targeting players that pandoras first party targeting segment can do, really is an intriguing opportunity for advertisers. Herring reading the script. He stayed all night partying with marissa mayer, bloomberg west are of las vegas, Jon Erlichman. What is the distinction this year at ces . What is different . I think we got some technical issues here two obvious stories. The hardware, the gizmos, gadgets that are everywhere you look. In the case of the music industry, the stereo equipment and headphones, then you got the other side, which is content. There are players like pandora that are very important part of partners to all these providers are hardware because if you try to get someone to buy something, you want to get them to buy something that is equipped with that they use in their everyday life. Pandora has been here for a long time. And the advertisers get more excited as they get more integrated. Equipmenthe music above the car industry, which is a huge presence here at ces. We spoke to another player in the music industry, bob pitman who runs clear channel, which competes with pandora and we talked about what gets advertising excited. The same thing with facebook and twitter, the more targeted ads. Thank you so much. Jon erlichman up ways to early in las vegas. Douglas will does this morning, founder and chief executive officer of tree. Com and lending tree. Com. He looks at the economy and he is kneedeep in it. We are going to talk about your Business Plan and where you are five years out in a moment. What we see all of this socalled disruptive joy of las vegas and ces. It speaks to a buoyant consumer. Are you observing that . Are the animal spirits there . I do think it is. There is some remote ends on the consumer side but there are all these great new innovations. Pandora, the fact you can get advertising in your car and can program the radio. People pay for that. I will pay for that myself. We are seeing it in lending tree and we see it across the board, consumers are getting i think consumers will, for innovation. If there is an innovative product and what is the innovative product and mortgage lending these days . At least for us is, we will give you choice and competition. You dont need to take whatever you bankruptcy. You have been doing it a while. Now what we are going to do is make a much more interactive. In givingmpare travel you ratings and reviews on different things, providers. We are going to bring a lot of those things consumer back in housing . Back but still reluctantly. Not fully throated like they were in 2007 when they were flipping houses. But the innovations are now around credit and understanding all of your loans. You dont even need to apply for a loan anymore. If we can save you money come on, stop. If we can save you money, we will save you money. You started in 1996 shameless in six months i dont think you will need to apply for a loan. We will hide your data, your credit, we know your current loans and if we can save you money we will let you know we can save you 50 a month. It may be the case when they go through you but through the big tank, not necessarily the case it could be the case incorporating it into how they offer mortgages . They make money by overcharging you. With the alternative the offering, what can they be picking it up as well . They will try to pick it up selectively. They do interesting little tricks. For example, whenever you request a payoff on a refinance is, which means somebody going to refinance your loan, they jump in and offer you a better deal. But they only do it selectively at the time that you will actually transact. Enough for the lending tree commercial. But, thank you. Tighteningon on the of the standards the government is imposing, these lending standards. Case, is it really going to impact the availability of credit at the end of the day . A lot of Consumer Protection people out there saying the government did not go far enough. It will not impact the credit in the short run, because it has already happened. What is coming in is called the basicallyion, which a lender, when they make alone, you are on the hook if the guy cant repay it, essentially. But they put in a safe harbor around consumer conforming loan limits in credit saying if the loan is in this box, it is ok. The challenge is going to come in a few years when you start to have private securitization and loans are outside of the qm limit to lower income borrowers, credit borrowers, loan to values, and those loans will be at substantially higher rates because lenders are going to be trying to protect themselves against the risks. I like to talk about. We will talk in a moment about doug lebda about the bigger banks in the response to the new initiatives. A new and Innovative Data check. Equities, bonds, currencies, commodities that features doing nothing. The euro moved. Had a weaker euro this morning. The bottom line is questions on european Economic Growth. Nymex crude does not really budge. Doug was just talking about this, the new mortgage regulations that come into affect on friday. Do they increase your Closing Costs . Do they help or hurt the Housing Market overall . Good morning, everyone. Im tom keene. This matters now is our death thet host, douglas lebda, force behind cnet, and lending tree you know lending tree, they have the muppet guy. True disruptors in banking and loans. Where will where will banking be in five years . Rg gaining credibility every day or is there a battle every day to beat wall street and the big banks . Definitely a battle but we are seeing a major shift. The shift is happening after the credit crisis. Throughout the boom days, banks and Mortgage Companies had all the customers they could handle. What we are seeing now is as and rates areoff now rising, they need us more and more. Bank of internet, round Point Mortgage company, these are not household names. How do you get a customer from bank of america all the way to cebonic financial . It is not that difficult. You do ratings and reviews from other customers. They get a fivestar rating from lending tree like ebay. And how do you buy something from joe smith123 on ebay . You did it because hes got great ratings in history. The differentvet banks you have so five years from now you will really be competing with jamie dimon . We basically see ourselves as an exchange or market do you let everyone on . We make sure they have good licensing and practices. It is very difficult to compete on lending tree because the technology is you have to be able to give a realtime pricing, realtime phone call availability to consumers, Great Customer service, great rates. If you have that, a little guy cant compete with the big guys. What we see time and time again is the little guy wins. Do t will little bank it jpmorgan will go to china or citigroup going to check republic, i guess you are killing the regional banks and those smaller than that . How are they responding five years out . A lot will come on. What will see with the banks in particular, the mortgage they will come and go. Strategies change. Some days they wanted to consumer lending. Some days they wanted to branches. Some days they like mortgages and some days they hate mortgages. When they like mortgages and home equity loans, they will come in, and if they offer great price and service, they will win. What is the appetite in america for 2014 . Do you really see loan demand finally clicking in . An nonmortgage area, particularly nonrefinance. Mortgages are going to go up because housing is doing fine. You will see it in auto and home equity as well. Thank you so much. We will continue this discussion. Coming up, steve is back on the news. Sac capital. Theur twitter question of day, what would you sacrifice for a lower cell phone bill . Casino bank, how much do you pay . , itsant even say embarrassing. We are all paying hundreds of dollars a month. What would you sacrifice . Last network coverage, texting . Kids, i imagine a data plan must be through the roof. Tweet us with that answer. Everyone. Rning, im tom keene. We have a lot to talk about this hour. Futures, negative two, dow futures, 16. Our guest host, doug lebda, founder of tree. Com and lending tree. Com. Here is scarlet with a top headlines. Unemployment in europe stuck at a record high. The euro area, 12. 1 last month. It has been Holding Stable at that level since april. With Economic Growth rate forecast at one percent, economists dont expect a significant drop in unemployment. Soccers world cup in qatar will be delayed in a few months a few months in order to play the games and cooler weather. Body nowthe governing says the games will be played between the middle of november and midjanuary. That will be a change. Stock up now because the supply low. Lveeta running some east coast Grocery Stores running out of the orange colored cheese food. Kraft said it is shortterm, possibly due to seasonal demand thanks to the all watching parties. I dont like the single slice. I go with them brick. How the eat it as a brick . We have it at Bloomberg Radio all the time. Another scenario where i will have to call out bs you dont eat velveeta. Yes, and we headed at Bloomberg Radio. Ken prewitt and i had it all the time. Tried to pull the wool over us. Has torow thing have a counterbalance. Eta one of the four food groups. The other is genesee cream ale. This is important as the truth in lending act may not lower your Mortgage Rate but age after pays it deters socalled risky practices. I would like to translate it into higher Closing Costs and fees. Robert from Rbc Capital Markets with an historic call on the Housing Market and the homebuilders in late 2008. He is continually optimistic on housing. Legislation as well. Do you care about what washington does and mortgage legislation . You absolutely have to. And getting the mortgage is the absolutely most crucial step to buying a house. That in our opinion this has been well telegraphed by d. C. As lenders had good runway to prepare for this so we do not expect this to be a disruptive event. There are other factors like continued admission in the job market that are more troubling and wage growth, which a bigger headwinds. Let me cut to the money question. In lending acth and increased fee act . Will it cost more to get a mortgage, closing cost . There have been changes in the Mortgage Market that have been incrementally more costly since regulation introduced the liquid to the financial crisis. So our question is, is this a Good Development and hasnt been telegraphed and two people understand what is going on . Are guys like doug ahead of the turk curve . Absolutely. We dont see this as a shock in terms of what is going to unfold. This is digestible. There are other concerns out there. It is really, what are you now expecting in terms of the slope of the recovery . What does the trajectory look like . I think expectations are a little high. I think Housing Starts will go one 900,000 in 2013 to million. Hopefully the d. C. Issues are out of the way and looking for returns. One thing you pay close attention to is wage growth. Why is everybody focused on the unemployment number and what do you look at to really gauge wage growth and the quality . Really goodth is a starting place but we also look at continued dislocation and the labor market as being a big headwind that is impeding household formation. With that situation we have a lot of people still out of work, a lot of people underemployed, and these folks are trying to and they are stuck permanently as being renters. They cannot make the transition to home ownership. If you look at household formation, it is consistently depressed. That is the Biggest Issue we are trying to work through. Hopefully we get to in a half, three percent gdp growth growing Going Forward. Inflation remains stable. It will take a long time to cure. Not an easy way out of a good setup going to 2014. I want to go back to the new morning rolls. How do fannie and freddie fit into this because they finance most of the mortgages in the country. Thef you are able to get safe harbor provided by conventional mortgage if you are a conforming loan, you can be ok. But what happens if you move outside of the bottom if you go into private securitization, is there a mechanism that will effectively facilitate credit outside of the conventional would then change all the roles we want outside of the nonconforming loan space, but it will not move the needle all that much until we reform fannie and freddie. I agree with that. Like i said, i dont perceive this as being a disruptive event Going Forward. 10 seconds before i have to make money. What is your single best buy . Theme repairing model. Fortune brands, mohawk and the leading makeri of impact resistant doors and windows, based in florida, fantastic smallcap company. These guys do a great job. A handyman 2004 thanks a much. If you want to watch more on your mobile advice without taking on a loan to pay your bill, we will talk about one Companies Plan to do just this. This is bloomberg surveillance. Tomscarlet fu here with keene and Cristina Alesci. Lets get you company new starting with jpmorgan. Its legal bills just went up in the latest settlement is a 2. 6 billion deal to resolve allegations it failed to stop ponzi scheme. S they will pay more than a half billion dollars to settle private claims. The bill over the last two years now past 12 9 billion. Loreal is scaling back in china. It will stop selling its line of garnier beauty prizes in the country. It is facing growing competition from domestic and south korean plan brands. It comes just weeks after revlon and announced it was leaving the country entirely. Take alan mulally off the list of microsofts next ceo. He plans to say at ford proven through the rest of the year. Who does that leave for candidates . Guys pretty former nokia ceo who is now back with the company. The Cloud Computing chief as well as executive right vice president. Here is something we never see. Cohenpital founder steve talking about Insider Trading just as another insidertrading trial involving a former sap employee gets underway. Pbss frontline documentary to catch a trader has never before beingast video of cohen deposed about what he knows and doesnt know about Insider Trading and the sharp comments from former sec chairman harvey pitt. Understand the rules of trading inside information is very vague. Are you familiar with rule 10 b fiveone . You would have to explain it to me. This you understand possession of material nonpublic information are you ever allow to train . Way it wasnot the explained to me. The way i understand the law is it is very vague. It is an interpretation of the law. I think every Hedge Fund Manager knows what material nonpublic information is, and if they dont, i sure hope they are not managing your money or mine. Pretty incredible. You can watch frontline online, just go to pbs. Org frontline. Harvey pitt is a real expert on this. A 26 chairman of the securities and Exchange Commission and clearly a lawyers lawyer. His comments are germane but what was really important about said hisat mr. Cohen interpretation. The reason these executives dont know the details, there are no details to mail. You can read through it i have done it, cfa exam, all three levels and general it is all about detail. But Insider Trading an incredibly squishy and purposely squishy area. Technically, but he was being asked on a very broad basis, can you trade on material nonpublic information . Himhat is not what i heard he was being asked him indirectly perhaps, maybe not, as clearly as you would have asked it, but still at the end of the day, fundamentally, a person who is managing that much money may be should not be getting into the detail but they should know right from wrong. Well said. Perfectly said. When you look at the insider saidng area, as mr. Cohen and the peace knowing right from wrong, there is not toggle switch logic theory within Insider Trading. There is the dangerous word. Ask martha stewart. Doug, this word interpretation comes across in a lot of it. It is very unclear, but at the same time it is one of those, if it walks like a duck and quacks like a duck, it is a duck. I know when i am talking to an investor, i talked about before, what is material on thisdealt withreg fd in the world changed on what you could say listen, given the fact that was on the knew it governments radar, wouldnt you have a punch list from the general counsel right by your computer . These are the three things not a chance. You are giving this guy way too much slack. Nothing to do with sac capital. There is no general counsel who would put their executive in that position. That to their job. Protect the client. Squishy, squishy. And heavily lawyered. I think it is billable by the syllable. Lets get to a data check because there is Economic Data off. Ck things adp employment numbers coming out at 8 15 a. M. , kicking off three days of job numbers because tomorrow we get jobless claims and the challenger job cuts and friday, nonfarm payrolls for the month of september. The consensus is 195,000 added. Features a little bit lower. Down by a point. 10year yield, inching higher but still below the three percent level right now. Good morning bloomberg surveillance, everyone. Here on Bloomberg Television good morning, everyone. Bloomberg surveillance good morning, jim and yellen, if you are watching soontobe chairman yellen. Not back to 2006 but it shows some of the effervescence early here in for the 14. Us,las lebda is with founder of tree. Com and lending tree. Com as well. To talk about at t because it is unveiling a new service. Contentany is hoping providers like netflix will cover the cost of streaming may be to promote their own new shows. But bottom line coming users will pay in this model. This obviously would disrupt a dispute existing model. Craig moffett, Senior Research analyst covering media. Telcost reeks of trying to find another source of revenue. Lets not forget, that is their job. Ways job is to try to find to get people to pay for data. The way they would characterize this and it is a comparison this is essentially 800 service for data 1800 number. Exactly. The same way when you call your Insurance Company and it typically has an 800 number so you dont pay for the outgoing calling charges, that is essentially what they are doing here for data service. Interestingly, you mentioned it netflix. Netflix is not part of this deal. To get it is hoping but the First Company they released, and i think very wisely, one of the First Company in the partnered with was actually an Insurance Company, United Health care. It is trying to make clear to consumers, by choosing the partners very carefully, that this is not something to be scared of. I know that once they start dealing with Media Companies they will start getting into the Net Neutrality issues. Anybody who read your 70 page or Research Reports over the last couple of decades knows it is a really physical body combat within your area. Media, cable, the different wireless people and all of that. Who has the high ground in this debate right now . No, you are going to pay, no, you are going to pay, the customer is going to pay. Who has the high ground . Adage hascally the been content is king and distribution is just a commodity. Where distribution is actually a constrained commodity, it is not a bad thing to be commodity. Cableroberts and the operators actually have power. It is a little harder for the Wireless Companies because the wireless business tends to be a somewhat more competitive business than the video distribution business. What is going to be really interesting is remember, we are proposing a model where they are going to start charging the companies for sending data as opposed to the other way around. What is going to be interesting is whether or not we emerge with a model where the content companies have to pay for transport as opposed in the model we have an paytv today where the content Companies Get paid you mentioned Net Neutrality early. Where the regular stand on that a regulator stand on that . The bigger players have an advantage. Up until now, tom wheeler, the new chairman of the fcc, said let 1000 flowers bloom. Let some experimentation happen with the new models. It is a very fuzzy area right now also because of verizon has actually challenged the whole concept of Net Neutrality in court, and that case is currently in front of the D C Circuit Court of appeals. A month ord know in so whether or not Net Neutrality ually exist as a concept probably because of Verizon Wireless is basically calling out the fact that Internet Companies are hiding behind Net Neutrality in order to not pay for this kind of streaming, right . That is a great point. I would argue Net Neutrality has never actually been as a concept about the kind of nondiscrimination and fairness and access to information and the First Amendment kind of issues people like to wrap around it. It has really been a debate about who has to pay for transport. And the companies that dont pay for transport want to make sure they dont start paying for transport. Lets come back. Craig moffett will join us. Important comments on john malone. Our twitter question what would you sell their sacrifice for a lower cell phone bill . I think i have a else i am paying for. What would you sacrifice for a lower cell phone bill . I would say the middle child is my answer. Do that bsurveillance. Middle child, just for sale. Dont forget, three days of jobs data. We have adp that will come out at 8 00 a. M. And then thursday, jobs report. Look for it on Bloomberg Radio, Bloomberg Television, 8 30 a. M. Friday morning. The interpretation of American Labor leacock labor lead time he. American labor economy. Whose new years resolution was to lose weight . [laughter] quick see a looking at me. He is blowing it with velveeta. Did you call the shortage . Ok. Bagels, the stores around the country, they are coming out with a smart choices menu that is basically creating bagels that are less in calories. Hey are trying to help people as a native new yorker, i would love to hear that. Be talking going to about that. Also, thinking about housing and whether there is a bubble brewing in new york city with tom shapiro, with a private equity firm that invests billions in real estate. Time for morning movers. Cristina alesci gets us started. Microsoft taking a little bit of a hit because they cant find a ceo. Taking a bit longer than investors would like, may be spurring some uncertainty internally and maybe some distractions. Talking about the fact that when Steve Ballmer left, the stock went up. Now the fact it is taking too long to find a ceo is may be hurting the company. And the fact that alan mulally is out of the running. He himself says he is not moving anywhere and will stay at ford through 2014 and is not going to microsoft. I would point out 27 billion in operating income last year. This thing is huge and hugely profitable. Theye enterprise but are a utility at this point. Micron movingt in the premarket, yesterday saying revenues topped earnings estimates following its acquisition which boosted sales of its products. Micron, one of the best performers of 2014, doing it again, moving higher and the premarket, indicated to open higher. Also watching at ts seeing how investors may react to the news that is trying to get content providers to foot the bill for streaming some of the data. It has not hit in the Media Industry yet, but it is certainly an indication that at t is trying to diversify its revenue stream. Doug from lending tree what is your biggest nightmare . What is the exogenous thing you are worried about for next year . I think the biggest nightmare would be government regulation. For us, it is all about whether the government is doing something irrational but the good news is i am not too worried. I think we are actually settled. There is so much fighting that nothing will get done, which i think is good. Thank you so much for coming. , lending tree, really revolutionizing the loan business. Talking about the changes coming up in the cable industry. 80 billion in acquisitions according to john malone. Coming up tomorrow on aloomberg surveillance, young dude in venture capital, he has smart stuff to say about the new new in innovation. Im scarlet fu here with tom keene and Cristina Alesci. Lets get you some company news from the files of bloomberg west. Facebook doing it first feeling indeed. The social network is buying mobile Technology Company little eyes laughter that develop software that improves the performance of apps running on the android system. No financial terms were disclosed. An obstacle for bitcoin. Alibaba is banning the Virtual Currency from the shopping website. The chinese ecommerce giant. Users from doing deals in bitcoin starting in 2014. Alabama says it was trying to protect the interests of its members. Apple will open which tend to store and mainland china, in a beijing mall, the fourth in the city. China accounted for 15 of china sales last year but the Company Apple sales last year but the companies that as it was scaling back plans. You know what we havent talked about lately . Big deals. Your favorite topic . Yes. And we cant talk about big deals without talking about Liberty Media chairman john malone. He is moving chest pieces and companies backed by malone are preparing for more than 80 billion worth of acquisitions, making me very busy. Fromsirius to but what he is producing a Time Warner Cable. When you look at mr. Malone, but decades of experience, this is a different story than most mergers and acquisitions, the land of transactions. Electrical engineer out of yale. But what john malone is really considers is the absolute arch financial engineer of Media Companies. For decades ago, he began to move the financial deck chairs of media with a telecommunications, class a, class b, that was iconic, and he has shown a real record for really not caring maybe how to operate businesses. Right moffett has followed mr. Malone for decades. He is with moffett nathanson. This guy is different, isnt he . He is. First of all, he has the history you describe. The cable cowboy history, really the grandfather of the modern cable industry. But as you said, john once said it is a crime against humanity for a Cable Company to be levered at less than four times either. Now you have the whole industry with the exception of chartered, which he partially controls, with relatively low levels of leverage. One of the things he wants to do is bring back the leverage himotally pushing against in a consensus. The leverage, forget about it, want to leverage up and make things happen. Word athat the vogue the moment, disruptive is a disruptive in the industry or does it embraced activism and the ability to shake things up . He is actually talking about something i think the whole industry will get behind. He wants the cable industry to return to the heyday of the 1990s when it Cable Operators work much more collaboratively. They dont compete with each other. They are in separate geographies so they dont directly compete. But they dont necessarily collaborate and all the ways he thinks they could and should. Yesterday, for example, you heard comcast say they were going to start growing subscribers again, for the first time in 20 six quarters. One of the reasons they are doing that is the Technology Platform they developed for theo and demand for and user interface. John thinks everybody should be licensing that platform from comcast and the cable industry should have a much more uniform face to the american public. Theres a lot of what others would cost synergies that he thinks is just running the business is better, just getting the companies to work more collaboratively and share best ideas. Who is on board with him in terms of collaboration. Now, his vehicle is charter and the ceo tom rutledge. But the whole industry actually i think in races that concept. The devil is always in the details, and the question is, right now, if the prizes Time Warner Cable, Time Warner Cable for obvious reasons has their own view of whether or not they should be controlled by someone else or independently. Comcast is still considering getting involved. And all of them are looking at it in part because a look at this as, well, what should they moreing a friendly with scale . Should we be negotiating differently with programmers. Should we be deploying technology differently . All of those in the table and everybody has the own vision. The big question of whether malone was able to pull up the deal was at some point financing, because chartered was a much Smaller Company and obviously time warner is much larger. Had charter communications, now that he has deal potentially and he potentially could go out and raise financing from banks, what else is standing in the way . Because regulators seem like they would be ok with it. Price. I dont think financing itself could ever been the limitation. The limitation is whether the board at Time Warner Cable was able to sell for the price charter is willing to pay, and the answer is, we dont know that. This is something we will continue to monitor and we hope you can get instant analysis when it does happen, when the price is met. It is now time for the agenda as we look at stories shaping the day. , something Craig Moffett lives and breathes who was the big winner in 2013 question marco was the Media Executive of the year . Remember, i am on the distribution side but you look at the whole thing. Moonves . E is les they still have runway left. But most but both my partner and i look out longerterm and say while we dont see anything that will radically change the equation in 2014, start to be wary about the fact that the wholeescalation in this ecosystem has gone out of control and there is concern about the afford affordability. The mall liberal model of Philip Morris decades ago cable bill, i will grounded out not happy. Ey are when does a change in how does it change . I think it is already changing. The phrase cord cutting that most people think of it is not a technology phenomenon. Everybody likes to say it is because of all the great choices on the way. It is an economic phenomenon. There was an article in the wall street journal that i saw last night that is shocking, says during the course of the recession, almost a third of all americans spend at least some period of time below the poverty line. That is an astonishing thing. I think it is a reminder that a lot of us are out of touch with the reality of so many americans. And when you say 100 and 60 for the cable bill 160 for the le bill it doesnt make sense. Youve got to be kidding killing me. I know, tom, you have to head off to radio. Go get your velveeta cheese. Im auditioning a show. The velveeta show . Will see you later. Looking atyou are the Consumer Electronics show. Seeing headlines not just about products but the personalities. Legere getting kicked out of the at t party. Obviously we are going to get more today, so we will check in with our west coast correspondent Jon Erlichman who will have more on that front. We are looking forward to that certainly. On my agenda, i am going with boring economics because we have the adp employment change numbers at 8 15 a. M. , kicking off three days of jobs numbers. We have jobless claims tomorrow and on friday we get the december jobs report. The question is, will we surpass 200,000 once again for job growth . This is to your point, one third of americans have lived at some point below poverty. Loyment is fundamentally employment fundamentally has to get better for everything else. And housing. The companies we look at, distribution companies, are dependent on household formation. And in the earlier segment, we heard household formation has been stagnant throughout the recovery. And it plays nicely into our twitter question of the day. We asked everyone and we are glad you are here because you can weigh in what would you sacrifice for a lower cell phone dont . The answers ranged greg, it goes to how wifi is taking over a lot of network congestion. What do you do when you get one of those messages from your cell phone provider that says you have used 75 of your data . Whatesnt matter demographic or socioeconomic group, everybody answers the same way, which is, you stop. Or if you are a parent, you tell your kids to stop, and you move to wifi. That is actually the challenge that all the wireless operators are dealing with. The industry is now relatively saturated in terms of penetration. Smartphones are nearly penetrated. So, what they are trying to do is drive volume but customers are not necessarily willing to pay. Craig moffett, thank you so much. That does it for bloomberg surveillance. It continues on radio. In the loop is next. Welcome to the 8 00 hour of in the loop. It is wednesday, january 8. Im stephanie ruhle. Betty liu will be with you in the next hour. Joining us this hour, bob nardelli, and now the founder and ceo of accelerate. Give us all of the agenda items. We want to look at the top stories in the market today. A first peek at the jobs situation for december. Report at 8 15 a. M. Then the fed releasing minutes from them from the policy meeting. They decided to start trimming the bond buying program. Will they continue . That is out at 2 00. Hed then