France, a mixed picture factoryhe world, tmi activity contracted. As 7 00, we get the Weekly Mortgage applications. At 9 45, the market u. S. Anufacturing pmi basically, either expanding or contracting. The 10 00, new home sales. That is the big one i will be watching. We will get png, six flags, boeing and delta before the bell. Facebook and apple after the bell. President obama begins his tour releases itshe nfl 2014 schedule tonight at 8 00. We wait with bated breath. We just wanted to mention, the president has arrived in tokyo. He will be meeting up with the president of japan, Prime Minister of japan at seven 15 for an arrival ceremony at the imperial palace and then have dinner with abe. Look at the shameless plug for ana. Walk up the latter thing. Mr. President. Y i dont think that is the president. This is in downtown tokyo, essentially. Not necessarily downtown. It is about 2. 5 hours away. It is the worst right. Bumpertobumper, three hours. There is the president ial stairway. He has a lot to talk about. Can i point out, it is somewhat reassuring to know even the president has to wait for slowness at airports. They dont have everything ready for him. Lets do a president ial data check. A little excitement with futures on the screen. The euro has gone nowhere in like eight weeks. Our next screen is more interesting. A quiet complacency. Terrific vix. 19, number. Under 1287. Im watching that carefully. Look at the gold chart up to 2009. Gold peak. This is technically a nightly chart. Youower highs will stop really wonder if we are going to test these two weaknesses in gold. Right now we are going to test the enthusiasm of scarlet fu to give you the front page. The u. S. Is ratcheting up pressure on russia. Sending 600 troops for exercises in four countries that border russia. U. S. Airborne troops will arrive this weekend. Everything is supposed to last for about a month. But they could stay there until the end of the year. That certainly sends a message. Ukraine resuming its offensive to get rid of prorussian militants in the eastern part of it country. On thoseeep an eye developments. Our second front page, the corporate boardrooms, allergan, the maker of botox, fighting back against a joint takeover offer from valiant and bill ackman from adopting a poison defense. That means if any unapproved shareholders own 10 or more, other shareholders can buy discounted shares. Bill ackman, they have 9. 7 . Bill ackman will be joining us at 10 00 a. M. Today. The work on is a superb. I cant convey enough, if youre part of global wall street worldwide, you have to read matt levine in Bloomberg View on bill ackman. Bill ackman should read matt levine. You have described this as a seminal deal going back to the 1980s. s idea. Is levine we go back to the hostel, true hostile takeover. You wonder why more people dont do this and whether it will open the floodgates. No third frontpage story, longer unionfree. Pilots voting to join air line pilots association. 70 voting in favor. , there will be contract talks. Investors dont like it because the stock was up 2 and once the word got out about the vote, the stock dropped. Why do i feel squishy if i know my pilot is making 37,000 a year . You would rather they make 80,000 . Well, i dont want to pay for it. Did we say this on the show like a year ago . What . Airlines are ridiculous. With the addon fees. I dont like that. I dont fly, but we scaled back. To saveat a g5 or g4 money. Those are the frontpage stories. Thats good start of on the American Economy lets get started on the American Economy. Ellen zentner joins us. Mortimer singer is with us as well. Ellen, i want to rip up the script. They talk about the american middle class. Is it as ugly as the New York Times says it is . I think you probably cant be described ugly enough. The middle class has been disappearing for decades in the u. S. If you look at wage growth by decades, consistently slowed every decade. Keptt a credit expansion the middleclass alive until the financial crisis, and we decided to start paying down debt. Specifically, in the article they target income so you would think that is wage and salary growth. In the middleclass and lowerincome groups he is talking about rely almost solely on wage and salary income. That is tied to the weak labor market and wage growth that is been fairly stagnant. You did not show up with 300 pages of notes. Defines Ellen Zentner middleclass . In the u. S. , family of four making around 40,000 a year. By new york standards, that doesnt sound like middleclass, but when you go outside of the you island that we live on, can make a fairly good living for a family of four. Unfortunately, other costs and costs of living have gone up wearing comes have not. After downturns, especially, e feel much more pinched and wage growth is barely keeping pace with inflation. Middle income class in canada was behind the u. S. In 2000 the dow appeared to be higher. What is canada doing right . I think canada is one of those countries that did not quite experienced the Global Financial crisis to the magnitude that other countries did. That is not to say they wont have their own sort of correction at some point. You have a lot of concerns around, is there Housing Market bubble in some areas of canada and there is credit expansion there, but they have a stronger labor market that is closer to full employment them we are here in the u. S. And they did not suffer the downturn canada banks had a problem back in the 1980s. We are behind them. Shameless plug. All whole new trend in journalism. Getting smarter on a topic fast, whether it is of shot or quick take. Our other guest host is mortimer singer. Business Development Firm focused on growing in the retail industry. How much do you see a apparel companies, retailers focusing on the middleclass or have they had to decide, lets just go for the aspirational, the highend or stick with the massmarket . The statistics sound pretty dire here. The global middleclass or those described as having disposable income is much lower than even described here now as being 10 world ound the that is the global middleclass. Disposable income of 10 a week. That population has doubled in the last 20 years. What is the store on fifth avenue . The japanese gap. Is it the future of apparel middleclass . Ultimately, just like j. Crew, it is effectively an aspirational luxury. , not aot a luxury brand high ticket price, but effectively gives you the buy in to that way of life. Very good. With us for the hour, mortimer singer and Ellen Zentner, James Glassman will join us in the 7 00 hour. Company news. We have word of the biggest junk bond sale in history. Is lookinge company to raise 11. 6 billion dollars in the offering that would easily surpass the present record of 6. 5 billion set by sprint last year. Theta is number one for Third Straight quarter, outselling every other car company last quarter thanks to rising demand from japan and china. Sales increased 16 for the 6 for the period. Massive job cuts over at barclays. The firm could cut 7500 jobs at its Investment Bank according to report. About 5000 of those job losses may come from the fixed income and commodities business. That is todays company news. This is something we continue to see out of the big banks. A shout out to meredith whitney, nail this 18 months ago. She did. And the headline, barclays getting out of the commodities business. Dfrank. Dod and to be clear, this is an analyst suggesting they will have layoffs. Somebody always knows. Coming up, we are going to double your earnings pleasure. Apple and facebook report after the bell. This is the pulse. Bloomberg surveillance. Ellen zentner and James Glassman on bloomberg surveillance. Warren buffett at 3 00 p. M. The major interview of the day, William Ackman in the 10 00 a. M. Hour. Read matt levines oped before you listen to a conversation with bill ackman. Look for them today on Bloomberg Television. Good morning, this is bloomberg surveillance. Fum tom keene with scarlet and adam johnson. It is a quiet day and earnings. No. Apple and facebook reporting after the close. If you look at facebooks chart since its ipo in 2012 come the stock is up almost 65 . Apple, kind of flat during the same period. A Business Insider did a great sum up of this. Im fascinated to see what happens. This is the perfect order for them. To surprise everybody and use some cash. People are expecting some kind of decision on increasing the existing buyback plan, maybe to 30 billion. The dividend could go up 10 to 15 . I think that is a big my idea is it is a migration. We have heard on the show, take six or seven quarters. It sure does. Walked into the apple store and i feel like that is the ultimate retail expense but if i look at the Sales Estimates today, the numbers will be reported flat. What is apple doing wrong . You know a lot about the fact they havent come out anything terribly new recently. Theyve had eight quarters of slowing growth, except the last one which was a slight uptick from the one before. Ultimately, their American Business is huge compared to the rest of the world. There are still a lot of opportunity to push the chinese business. Would you suggest the chinese or Indian Business would be less Fourth Quarter waited than in the u. S. . Are they going to be a company that lives and dies october to january . Many of those and india, the festival of lights is in the Fourth Quarter. . . What about facebook the big issue with facebook apple, is whether they release units. Wo larger screen that could result late june, maybe. Out ofgenius on twitter greenwich, connecticut, the goto guy, he has been blogging and tweeting about the new iphone and says it will be larger. Theyre going to take the screen all the way to the edge of the case. Do i want a larger screen . I think at your age, you need a larger screen. Harsh. Even i have a screen twice the size as that one. Back in the day, the tinier your cell phone could be, the better. And now it is getting bigger and bigger where it looks like people are holding their ipads to their year. Ear. Theres more room for facebook to advertise to you. More and more people are using these big phones and facebook has this dominant position as the most engaged mass reached. Their 52 now and mobile revenue. The consensus is seen as achievable but user growth will be difficult, challenging because theyre moving off such a large base. I go back to google and mobile growth, and negative 9 . You do wonder, given how the stock has performed. We talked about how facebook is up 65 since its ipo. Highgrowth tech stocks have stumbled of late. Even if they do beat their numbers, will they get the uptick in the share price . Not necessarily. Looking at the past three earnings announcements, facebook has been anywhere from 15 to 35 . And how much their expenses have increased as well. 19 billion for whatsapp. You look at the stocks, if you did not know the title, you would say that is a great company. You look at the stock bingo, can i buy shares . Another company with a greatlooking chart is six flags great adventure. Coming up, were going to be joined by the ceo himself. There is rachel and colby. I have ridden all of those multiple times. This is the guy who brought six flags out of bankruptcy. Clocks are you kidding me . Theyre going to dubai. What do you think . I like it. This is bloomberg surveillance. Comee everywhere you are your tablet, iphone, you name it. We will be right back. Good morning, bloomberg surveillance. I am tom keene. Scarlet fu and adam johnson with me as well. Adam has a busy morning. Chinas manufacturing segment struggling. Factory activity increased just slightly. Indicating contraction. Different story in the euro where manufacturing and services expanded faster than forecast. Almost a4 in april, full point better than estimates and close to a threeyear high. Any time you see the number of 50, that is expansion and below 50 is contraction. Any faction and services in germany showed growth. Manufacturing and services in germany showed growth. Ols becomes the 26 major leaguer to hit 500 home runs. The washingtonites stood up and gave him a chair. It was classy. Earlier in the game, pujols hit 499. Use the third youngest player to reach the 500 milestone. 60 minutes did a story on his great charitable efforts. Did you see what happened last night at fenway . Yanksdline is great, edition torment. They all did very well. I will start sweating may 1. Tom friedman writing today in the New York Times in other words, we know what they want to do, but trying to get that to happen in the Political Party takes time. Ellen zentner, with us. Why hasnt oil moved . It hasnt moved because the world is a scary place, and we still have concerns about growth in many areas of the world. Specifically, countries that drive prices of oil. Concerns over what might happen, russia and ukraine, that is been more concentrated in the Natural Gas Based in the oil space. There hasnt been something to drive a spike in demand or prices. What is driving is the outlook for jobs and the economy. We will be back with Ellen Zentner. On the island of manhattan and the bronx as well. 3 and 0. Who is first place . Thank you for mentioning that. Neenew york yankees, first plac. Thats do quick data check. Not much to talk about. Signs of aher, maybe better economy. Gainers and losers. Up 15 yesterday, giving a bill ackman a 1 billion paper profit so far. Hes teaming up with italian to make a hostile takeover for the maker of botox. Allergan is seeking a poisonfilled letters to fend off this acquisition. Allergan up. Netflix, after its results yesterday, the results better than anticipated, but would everyone is focused on is the announcement of a price increase for new customers, one dollars to two dollars one dollar to two dollars. Mcdonalds turned out pretty good 90 days given the weather. It is the great mystery of american economics, how the rest of the year will fare after the ugly winter. In recent years, it has been a summer swing. According to Morgan StanleyEllen Zentner plus, looks good to robust. Starting with an early may 2 jobs report. She senior u. S. Economist at Morgan Stanley. Am i right, 250,000 statistic for nonfarm payrolls . What we felt was march and april would be the strongest months for job growth because they would both have some of the payback from the three months and rohit had weather. In march, the weather was comparatively much better than earlier in the year, but still wasnt quite back to normal. The low level of jobless claims is something that informs that view as well. It fell or has fallen to very low levels. Tomorrow when we get initial jobless claims data, dont be alarmed because it will jump probably around 20,000 on the headline. They typically always happens in the week that includes good friday, but it does reverse within a few weeks after that. The word at the moment is slack. Slack, slack, slack. You push against that. He suggests the American Economy is doing better than slack. Theres less slack the latter private a lot of private forecasters think theres less. We think gdp has slowed to 2 . Nd 2 full employment is around 6 . Some believe it is 5 or lower. We do believe there is less slack in the economy than the fed does. Books i want your take on what is said about how the fed can improve medications. Can improve. It makes more sense for all Central Banks to tell the world with the economic forecasts are competitive these inputs are quickly influence policy. Arent we doing that now . 19 dots we have to follow and guess and put of floating head about each dot in which longs to whom. It has been suggested, going more reliance on the materials unless reliance on the statement. He has said he would love for them to publish central tendency estimates instead of all of these dots on the map. Give us a pinpoint estimate. This is critical. Deutsche bank has a hugely optimistic call. Do you agree on Economic Growth . Arehat i would call, we optimistic on growth. We dont have accelerating in 2015 going into a rates hike. The fed has growth accelerating and 2015, typically as you get closer to the first of tightening, think housing, especially, Interest Rates slow. Fairly growth strong, but not accelerating. You are the economist. Your productivity at about 6. 5year high. And you have labor force per dissipation still at 35year lows participation still at 35year lows. Productivity may be higher than it was as it plummeted after the financial crisis, but still fairly low historically. It looks like it is starting to climb will stop we need to be closer to 1. 5 or better in productivity. The Labor Force Participation has been the biggest focus after the financial crisis after shrinking labor market, Smaller Labor market, aging population, women that have gone back. Childcare Services Spending drop because there are less women in the labor force. Rates haveon dropped. More kids are going back to school or staying in school longer. There are a lot of moving pieces to lower the participation rates. That is one of the things that informs our view. The natural rate of unemployment has moved higher since the financial crisis. It was already on that trend. As we talked about the use of the word slack come a what does that mean to you and your clients when you advise them on what to do next . The consumer, as we talked about earlier, is sluggish in general. Our whole notion is global brand, global brand. Take your businesses around the world to benefit from just focusing on the United States and, frankly, the west. Look at this chart. You talk about shadow labor. You take the ugly number and subtract regular unemployment rate. This is the differential between the 12 are sent and the 6 unemployment rate. To janet yellen plus defense, we have a long way to go back to normal. Correct. It has been improving, but still fairly disappointing. She is absolutely right. This chart it takes some of the complication out of full employment, how much slack there is in the labor market. Look at that differential and you can see what it means for wage growth. Maybe we should just look at shortterm unemployed . The sum have to look at of the jobless . I think we have to look at it all in. Janet yellen was asked that question at her lunch and and said, look, i dont necessarily believe longterm employee or unemployed should not matter because they dont exert downward rusher like shortterm unemployment. Now there is a competing fed study that is just come out yesterday. Inmate in the day before that says, no, both matter just as much. Im glad she took a balanced approach. Taking that spread between the broad specter of unemployment and the narrow bring back the chart. Lets make it central. Why does it have to be so complicated . Yellen 1994 janet transcripts for fun bedtime reading said, we dont know where the natural rate of unemployment is, so lets look at wage growth. This way it takes out who is estimating natural rate of unemployment, who has a right and wrong. Ellen zentner with a great chart. Have a long way to go to get rid of that shadow were talking about in the chart. Levinday, representative of michigan join us and said, its different this time. You have to extend the and Employment Benefits will stop good or bad decision . I think the program has shrunk to such a small rate, they missed the boat on extending it by not doing it before or around the start of the year. I think it is a dead issue that is not going anywhere in the house. Behink their time could spent better elsewhere. I think they missed the boat. Implications for consumer spending. We want to bring Something Else coming up on surveillance, businesses are starting to spend big as well. Are we seeing the real industrialization of the American Economy . Our single best chart is next. And our twitter question of the day as we look at food prices, ingredient prices going up mostly it is vintage champagne. What does that fall into . It is being very pragmatic. Is it a food group because there are grapes . Good morning, bloomberg surveillance. We need some top headlines this morning. Ukraine moving closer to a new push to try and drive militants out of the eastern cities. The countrys acting president has called on Security Forces to move against separatists after two bodies were discovered in the Eastern Region showed signs of torture. Ukraines president said they had crossed the line. Theu. S. Is resuming some of military aid to egypt that was stopped last year. They comes after the with certified that egypt is abiding by its peace treaty with israel and working to combat terrorism. Some military aid was suspended last year after each of them postits democratically imposed elected president mohamed morsi. Malaysia, International Investigation team for the missing flight 370. Malaysian officials said they were adding asset to the deepsea search for the jet. Crews are focused on the lack led asked leg of the search zone to find traces of the aircraft. Amazing it just gets sadder and sadder. They still havent found it. It is mindboggling. To think about a plane disappearing like that. What is the single best chart . This is a good economics 14 Ellen Zentner and morty singer. It comes from Robert Albertson will sto. It tracks yearoveryear in personal spending. They strongly recovered. Hours and points out business spending as measured by growth, the yellow line, is growing at a similar level to personal spending despite the fact it is four times smaller than consumer spending. The question here is, are we moving toward a Less Consumer consumption driven economy . That might be one conclusion you could draw. He says is strongly reflects americas reindustrialization. I have aged looking at this question. Are we finally going to invest . We think we will have stronger investment this year, but the two are linked. You will not have strong Business Investment without stronger consumption also. Sort of the chicken and the egg. Consumers spend more, so businesses have to produce more. Theyre basing it on consumers outside the u. S. Picking up the slack . Were seeing manufacturing coming back to the u. S. Because of needing shorter lead times. You cant have everything being manufactured in china. The cost of manufacturing in china is rising. How much is shipment . To make a pair blue jeans in china, how much is it to move . Is it a big deal . The percentage depends on the price of the product. I would put 10 to 15 . Did you say 300 jeans . Are you kidding me . There are 500 jeans, too. How much are yours . They are not 500. At j. Crew, there are 98. I just bought them. When they are on sale, they are cheaper. I will buy more than one pair. We will discuss more about business spending. James glassman will be joining us. Last night on the late show, David Letterman had stephen colbert. Im going to do whatever you have done. No, no, no, no. You dont want to do that. It seems to have gone pretty well. It has gone on. Well, i am thrilled. Im thrilled as well. In a situation like this, paul and i have been doing this for a long time, and they could have just as easily hired another boob like me, but they didnt. They hire a guide they hired a boob like me. Every boob is like a snowflake, we are all unique in our own way. He is going to have fun. You are a branding guy. What is it about these two brands . What makes them so good . I think it is the spontaneity. As it pertains to what is going on today in our environment and industry, is the comedy or comedy in general has taken over music as the number one cultural touch point for the generation. That is why youre seeing a younger flow of these guys coming in to take those top spots in the big shows. They took a selfie with Stephen Colberts iphone and posted that as well. There it is. Theres a point at which selfie is going to become hackneyed. We have all done selfies, even with the oldschool cameras, we just never called it that. The money that is involved here. The minting of money of late night or early morning. Is it going to be colbert or colbert. None of us they up and watch this. I know that for certain. Im going to miss his show on comedy central. I watch that when i am at the gym. There such a belief that will go out and find a replacement. There have to be 20 people lined up. Lets hope it is Something Like tina fey or amy poehler. That would be great. Up, the current state of Luxury Brands and how they can continue to grow in the face of economic headwinds, not just in the u. S. , but across the world. This is bloomberg surveillance. Took irony it is a busy morning here at bloomberg surveillance. Our twitter question of the day really interesting discussion. Here is scarlet fu with company news. We are techfocused. Netflix is going to france from introducing its Online Video Service in the country by the end of the year according to a person with knowledge of the situation. Theyve been talking to french regulators about how to pay for content and comply with streaming rules in the country. To roll out Internet Tv Service in u. S. This summer. They have in telling programmers that a late summer release date is possible. Up walt already signed disney for the service and spoke to other networks including cbs. Charter is closer to a deal to buy about 1. 5 million cable subscribers from comcast. They will form a company with another 2. 5 million customers according to people familiar with the situation. Buys part of its deal to time warner cable. That is todays company news. Global luxury spending could reach 1. 2 chilean provided china keeps growing and Luxury Brands get better at selling at the front line. For helpingst Premium Fashion retailers develop their business, mortimer singer with his own brand which is a star in its own right, a big store on madison avenue get only last month finally went online. What has taken a guy like tom ford so long . Point, 1. 2 trillion by 2020, one quarter will be direct Consumer Online. The other is the multichannel customer. More likely between two times to five times more. Effectively, these guys slowly but surely and quickly will all be online. Your said burberry doesnt well does it well. What do they do write online . They have a Digital Marketing plan that engages the consumer and creates a viral sensation by making content which can be shared. They end up becoming Media Companies in a way, communicate in ways that grants never did. Isnt there a contradiction and Luxury Brands going online . If its online, for consumers that means it is available, every size and Colors Available at any time you want it. Yet luxury depends on this being the heir of scarcity. Rocks effectively, when they have a buy for the store online, they buy exclusive to that store that you cant find anywhere else. Will they turn off people by having something say this is not available at this time . Will they turn away potential customers . If its not available, they just dont show it. The same thing, but a little different. Quality . You convey you walk into a store in the carpet is plush, it smells good, sexy music, lighting. How do you do that online . , what theyre using today coming back to the notion of developing content, is video. They are bringing the designers themselves from behind the curtain, to talk to the consumer. Theyre doing a matter of things to have Fashion Shows brought to the Consumer Online so you can effectively see the model walking toward you, doing a turn. In your world, after fashion week in new york and des moines and london milan, paris. What did you learn . Retails the sum, for people, out of the show of all of it . I tend to be someone who doesnt think that whole circus really brings much to the question. I think it hinders the luxury industry. Why is it . s showsains the h m them what is coming down the pike six months from now and its up to the consumer two weeks from now. Ellen zentner, would you do that . Not going to buy from Alexander Mcqueen and wait for zarra . I dont, but im not your average consumer. One thing morning made an important point on, bur barrys interactive experience. It is the videos that get me to buy online. When i click and can see the model Walking Around and posing. Today change the equation . And i was a ralph lauren. There were two of the pioneers of creating the content online. And dont forget the burberry executive apple, too. What about sports where . Whenever we see what is going on a bloomingdales, tends to be on track pants. High end, but track pants. Activewear is the word. Percent,own nine versus apparel in total at one percent. It is a lifestyle. People are crossing over to sharing the fact they want to take care of themselves. I cultureust an but an we culture. Do you do soul cycle . I dont. Something for all of us look forward to. Our entire control room. We will look forward to doing it together, mortimer. Thank you for joining us, mortimer singer and Ellen Zentner of Morgan Stanley. Sustained economic weakness. China considers growth on a downtrend. I am going to six flags that will be when hell freezes over in dubai. I am tom keene. , scarlet fu and adam johnson. We will talk food through the hour. Adam, we have a brief this morning. A mixed picture of Economic Data. Pmi. N my Economic Data helped send the you on to a low. We should tell you france manufacturing factoring activity dropped. In the u. S. , we have a number of Economic Data points. We just got the Weekly Mortgage applications down. 3. 3 last week. Were going to get our own a manufacturing pmi. We ares before the bell, waiting for png, six flags, boeing, and delta. Busy day. President obama beginning his four nation tour of asia. The nfl is releasing the 2014 schedule. That will be tonight at 8 00. Scarlet, what do you have for company news . The maker of botox is adopting against a takeover gallon pharmaceuticals. Pershing square has acquired a 9. 7 share state. They have made a 1 million paper profit. Jetblue no longer union free. They have voted to join in the pilots association. The union won the support of 70 of jetblues pilots. Investors did not like the move. A prediction of massive job cuts at barclays. It could slash 7500 jobs. About 5000 of the job losses may come from the fixed division. That is todays company news. It still gives pause the president of the United States will be greeted in tokyo by the imperial family at a state dinner. We will look for that in the coming days. Margaret, what is the goal of the president . What is the number one goal as he comes to japan . Goal is to try to breathe some progress back into the tpp. The other one is to convince the allies in asia and china that what has been going on in russia and the ukraine is not a roadmap is to proceeds. In china gets more aggressive with the islands. What does it mean to president obama . He have been trying to pivot to asia for several years and keeps getting pulled away for situations in syria or egypt and now it is the ukraine and russia. The pivot is supposed to be the u. S. And redirecting a combination of its economic prowessd its military towards paying more attention to asia, theme works and rise of china, and start bringing together japan, south korea, and some of these dollar some ofthat we have these smaller nations that we have growing alliances with. Things keep happening. Part of the trip is to assure all of these countries, including me for that he is the four that he is visiting that he is serious about redirecting energy. There has been a tension between china and japan over the past six months over those disputed islands. What is the obama message on those islands to japan . Morning, the japanese open up their newspapers to see an interview with president obama in the japanese press, check hagel and john Hagel Chuck Hagel and john kerry have been doing this islands time these are in minister by japan and that is the u. S. Position. Thank you so much. She travels with the president on his trip to asia. Procter and out with its results. Growth to be about 1 . Ceo it is something the ceo talked about. Theres more importance on productivity improvement, and that means costcutting. In terms of the numbers, core eps was 104. That be the concern since. Not a busy earning day. Stay tuned to Bloomberg Television and radio this afternoon. Apple and facebook with the Important Technology earnings. Right now, we go to food. I have given him way too much money. Wonderful to have you here. Were going to talk food. Of food rightne now. It is a time of angst . You talked about fashion looking good, eating healthy. We are in the organic industry. You look at that segment, there is a lot of excitement in that segment today. Numbers came out yesterday, growing to 12. 5 . The consumer will spend on Higher Quality products. Where did Coconut Water come from . Did you invent this . We invented a lot of those things. Organic baby food, juice. Gerber is not good enough. One hour is going to be big shameless plug. Will spend for Higher Quality, but when they lose their job, is that where they cut back as well . You need to make choices. There are 700 billion of food sold within the u. S. Consumption. You come back and look at the Companies Like coke, we are not drinking soda or reducing soda. We are not eating ways potato chips. Foods walk through whole and you look at a bag of terror chips, it is like 10 or . 15 more. The nine dollar tail green juice for nine dollars . A bottle of our blueprint green juice, there is six pounds fruits and vegetables. It is a meal. And i go to chipotle panera, i am spending more than nine dollars on my lunch. Nine dollars for a bottle of juice that is six pounds of organic fruits and vegetables that go through a cold pressed. Is the shameless plug a button broken today . What is your bestseller right now . I have a four kids and i love all of my kids equal. I love all of my brands equal. We have 2200 products and whole foods. We introduced infants and toddlers to their first foods and we have nine to 12 million mothers a month that are on our site, learning about our products. You have four kids you do not have to worry about the middle child. Nordion dubai 24 pounds of vegetables nor do you have to buy 24 pounds of vegetables. Our twitter question of the day what drives your grocery choices . Price, quality, or convenience. Tweet us. A data check. If i had a fourth kid, i would not have to worry about the middle child. Futures are little bit negative. Hydrocarbons down to a 101. A pretty reluctant job recovery. Business is growing more optimistic. We will be joined by jim glassman. This is bloomberg surveillance. This is bloomberg surveillance. I am tom keene. Hain celestial is a whole foods company. The beef is free range and free to roam. You have been hugely successful with upscale. Can you go down skill . Can walmart sell organic . They said 94 of their consumers would buy organic if it were available to them and affordable pricing. Thebig thing is availability of organics. There are 4400 walmarts out there. Buy think the consumer will it . If they have the choice, i think so. Of a discount doesnt have to be . You have to shave off 10 or more . A 10 to 15 higher price right now. I say the consumer still will pay 10 more for an argument product because it is a much better product. There is no genetically modified ingredients and there are no pesticides. The concern is does walmart want to make it a football . When you look at the uproar , how impinged in hain celestial is america . Great question. If you look at genetically modified ingredients, there is no science that says hey, because i am having a genetically modified ingredient that my kids will be smarter or going to harvard. If you look around the world, u. S. And canada are the only countries that allow genetically modified ingredients. How many kids do you know that are glutenfree . I am a big believer that food is the cause of a lot of issues. The consumer should know that they are buying food that is genetically modified. The largest provider of genetically modified free ingredients. Do you make when someone does a juice cleanse . That gets married has to have a fiveday juice cleanse. They get married and when they have babies. We feed them baby foods. Over to whole foods, and you buy the fruits and vegetables that are in one of our juice cleanse, it is 20 if you buy them by the cells by themselves. Im going to do a juice cleanse. Sticker shock at the grocery store. An important day of important interviews. This is great. We are looking forward to them. Mohamed elerian and warren buffett. In between, William Ackman. This, went a primer on will get you ready for that interview with bill ackman at 10 00 a. M. This morning. Look for those three interviews. I havetreated tweeted it out a number of times. Host, irwin simon, ceo of hain celestial. I have agreed to do a juice cleanse. That will be a painful week for you. A week . It could go nine days if you want to do it right. Chinas may factoring sector is struggling. Her to sing manager index shows manufacturing increased weekly. A composite index tracking both indices jumped to 54 and april. That is a full point better than the estimates and close to a threeyear high. Inufacturing and Services Germany show growth. In that malaysia they are in appointing an International Investigation team before flight 370. Theyre adding assets to the deepsea search. Crews are focused on the last leg of the search zone in an effort to find traces of the aircraft. America is forming jobs, but it has been a reluctant job recovery. James glassman is jpmorgans senior economist. Off of your middle market Business Leaders outlook. Thank you for joining us. This is a report of optimism. It is. Tough, smalle businesses get squeezed a lot. They have been klim planing complaining for a long time. Bigger companies are talking about financing needs for Capital Expenditures and theyre talking about converting some parttime jobs to fulltime jobs. To shift yourh optimism on gdp . The economy will be speeding up. It is more color that the recovery is far broadening. It confirms the whole economy has momentum. They may be spending more, are they going to hire more . Were not seeing dramatic change in the hiring. It does look like they are talking about stretching some parttime jobs into fulltime jobs. A lot of people are working parttime because their business is slow. If this is in transition, we will see more declines in parttime. This is the key of the ministry of the mystery of the second quarter. I am reading this correctly, the survey that you just did for jpmorgan customers on Global Economy, national and local economy, everyone is more optimistic. More optimistic this year than last year. What is interesting is where you know the most your own business, they are the most optimistic. About get further away what they know, they are optimistic, but less about their own business. You know a lot about your own business. It is interesting. I have never seen optimistic readings like this before. At a time when the economy is still in the fifth inning of recovery is telling that small and midsized businesses are does this mean gdp estimates are too low . The middle of the winter disruption, counterbalance to what happened in the first quarter. It is a reason to believe that the recovery has more legs to it. Spendinge heard pickup. Do you hear from these small and mediumsize businesses . What do they tell you that the big businesses do not say . They are squeezed. They do not have pricing power. Find regulatory issues and Health Care Issues more challenging. The big guys do not. That is the big difference. We have not seen much change on this and theyre optimistic, even though they face the same challenges. To guys like you, that is an important thing. What is the stock market telling you about the next four quarters of americas economy. The recovery is underway. We are going to get there. They smell the recovery and that is why were doing what we do. It is not just about the u. S. Even though we worry about europe and china, is telling you that the Global Economy is back is back. Consumption is up over 12 . That is mainstream, supermarket, you is you mentioned have a big operation in europe today. We see good growth in europe. Thank you for your jp morgan report. Good morning, everyone. 8. 2 of People Living in that view of new york city our juice cleansing as we speak are. I will be juice cleansing why am i doing this . It is good for you. It is bloomberg surveillance. A Beautiful Day on the island of manhattan. A lot to talk about. To company news. It is number one for a Third Straight quarter. They are outselling every other Company Thanks to rising demand. Toyota sales increased six percent. General motors and volkswagen selling about 2. 4 million vehicles. Deutsche bank is shaking up its latin america business. It is reducing its Equities Team and may cut its Equities Group entirely. Staff as eliminate part of restructuring. A prediction of massive job cuts at barclays. They could 7500 jobs. About 5000 job losses could come incomes fixed currencies and commodities business. That is todays company news. Can blame drought, disease, and demand pushing food prices higher. Fruits and vegetables are facing some of the highest food hikes we have seen. Kale caesar salads are hot, but berries are even up 14 . Your juice clean is going to cost you. We are here with our guest host, erwin simon. Foods largest supplier. A drought in california has caused a lot of issues. Almond prices have almost doubled. We just bought this rice company. Today almonds have gone up 18 . Imagine taking a 15 or 18 price. We are taking prices at three percent pricing. The big thing that we have come productivity. Is we the biggest things are the largest producer of natural products. Quick compare your dialogue versus kelloggs or some other packaged giant. At a 10 to 15 higher price because i am buying organic mo free. On the other hand, it is easier for me to get a higher price and easier for me to walk in and get price increases. Why walk into costco and say i need a price increase on almonds, costco is one of the biggest buyers of almonds. They know i am not going in there to increase my margins. Everybodys friend. My father taught me to hug your customer, your wife, yourself, you will be a happy guy. How are you doing with and wild oats coming together . Makeheyre going to packaged foods. There are challenges out there. One of the things walmart has to do a sources ingredients. Are these price increases here to stay . See crops and here. Es yes, i see it out of our cost products . We cannot sell all men but are and think the consumer is going to buy it. Is Almond Butter something i. E. Doors at something i put on my face. You put it on your toast. Lets get breaking news. Boeing reported its firstquarter results. Consensus. Ng the revenue coming in higher than estimated. Its forecastsing because of the benefit of a tax settlement. Talks a little bit about the backlog. 19 billion of net orders during the first quarter. Jim mcnerney is an animal. Boeing shares are moving higher in the premarket shares as well. Good morning. Bloomberg surveillance. Look for our Digital Products across a wide swath. Bloomberg. Com, Bloomberg Radio i am tomombergtv plus, keene. With me, scarlet fu and adam johnson. Me. N simon with he is the chief executive officer of hain. 25 more people bought season passes and return more frequently and spend an average of seven percent more each time that they go back to the parks. The ceo of six flags joins us from dallas. We can talk about roller coasters and the expansion into dubai and a moment. Which parks are doing best right now . Many of our parks have not opened yet. We are early in the season. Only five percent of our full years of attendance have gone to the part. It is a good start overall. We have seen a 25 increase overall. Listening to erwin, we have seen an average per capita increase of seven percent in the quarter. This follows a string of records. Fivefold. Is up most importantly, our Guest Satisfaction is at an alltime high. We have walked around the park in new jersey. Some of the stuff you do. We had a tremendous time. You have heard me say that innovation is in our dna. Our people think it is in rides. This year, we have four new recommend recordbreaking rides. In addition, when you look at our parks, we got that reading and we are proud of that. Were doing so much in the parks. We have all season dining passes and a membership plan that is a first in the regional theme park. Informationweek stall the progress were making them put us in the top hundred. Theres this great article about how the american middle class is no longer the worlds richest. How do you adjust your operations for this shift . One of your guests talks about the fact that Global Brands are moving globally. We have a tremendous brand in north america. We have a great value offering. We think there is room to grow on the price front. How wecareful about price. We want to make sure that consumers dont feel like they are doubts, but were seeing nice increases in spending and we anticipate that to continue. About the broader picture, we will be more international. Dubai expansion into smooths out the bomb that you usually have an firstquarter earnings. Explain why dubai. We are looking at different asia, latins in america, and other markets. All focused on how we can take the brand globally. You brought the company out of bankruptcy. We appreciate you joining us. Do not forget the five percent yield on our dividends. Thank you. Ackmansl discuss bill latest takeover attempt. Makers,e on market to discuss his position in alle rgan. Good morning, everyone. Warren buffett in the afternoon. Betty liu will be speaking with mr. Buffett. As is nothing compared to what she is doing this morning. Mohamed elerian. He speaks. What is your first question . I dont know why . Had the perfect see where he can run the whole world. The story is well told. We want to hear from him. Why did he leave pimco what happened between him and bill . What is he doing now . One piece of news that he will be sharing his his new book. He has signed a contract and i will be telling you who bought the book. First interview since leaving. The last time he spoke was in january. I was before this whole thing blew up. He has been writing commentary, but he has not spoken out on tv. Beple like us are going to asking him what is going to be going on between him and growth. He has to talk about this. Otherwise, it will be the elephant in the room that all is him from this on out. Mohamed elerian. You also be speaking with warren buffett. Also, at 10 00, we will be to talkMarket Makers about his bid with allergan. This is a big, central figure in a momentum stock rise and collapse is a gilead sciences. They had firstquarter Sales Numbers firstquarter earnings numbers that were much better than next but did. Dan expected. In i think it is a thousand dollars per pill. One rated biotech analyst. They are pounding the table on gilead, saying they got to cheapen the selloff. You see why he was right. The market is an indicator of where we are. It is amazing. A very busy earnings day. Earnings after the bell. Apple, zynga, facebook. Tomorrow, cocacola, time warner cable, microsoft, starbucks, and amazon. Thery good glimpse of consumer over the next 24 hours. I am looking at how the stocks are trading. Apple shares have changed little. Market is struggling this year. We have cost we have crossed the flat line looking for direction. President obama beginning his four nation asian tour. What does he hope to accomplish . Our agenda is up next. Coming up tomorrow, looking forward bob nardelli with depot. R, with home the new activism that is out there. Are we going back to the 1980s . Much watch must listen. Bob nardelli tomorrow on bloomberg surveillance. Irwin guest host is simon, the ceo of hain celestial. Netflix is going to france. They will introduce its Online Video Service by the end of the year. Been talking to french regulators about how to withor content and comply streaming rules in that country. Dish hopes to roll out its Internet Tv Service the summer. They have been telling programmers that a late summer release date is possible. Up walt disney for the service and has talked to other networks, including cbs. Charter is close to a deal to buy about a million and a half comcast subscribers. Comcast has said it plans to as part of its deal to buy time warner cable. Lets get back to the store you were referring to. It was a wild story yesterday. Fend offan trying to the joint hostile takeover bid from why are you looking at me when you say that . You are getting sensitive. It is the juice cleanse. Our guest host has handled carl icahn in the past. Shockingly, they are still on speaking terms. Icahn will come into this because bill ackman is in there as well. Carl likes a good fight and a Good Opportunity and he likes to make money. There is money to be made. When there is a fight to pick with bill, karl will jump in. I lived with activism for three and a half years. I had every banker wanting to be part of my team. You heard what they said before. Get yourself a poison pill, spend lots of money on bankers and lawyers. I sat down with carl and said heres our plan and how were going to execute it. At the end of the day, if you do not execute, carl will force you or want you to sell the company. That is good for companies that are not well run the need to take costs out. And we executed well. Carl sold the stock at 80 and made over 430 million. Not every company as well run today. We go to our interview with bill ackman at 10 00 a. M. This is my morning must read. Spectacular from matt levine. Good for valeant and pershing square, who saved some money and improved their chances with clever structuring. You can call this a hostile takeover. Say am ieo and next . What am i changing my business . Business is tough enough to be worried about who is going to attack you from a financial side. We say we do not run our business for every quarter, but we do. This is important. Or owns your shares, are they complaining about what carl icahn is doing . They are along for the ride. They are a longterm player. Up 30 , they are going yes. Are they selling 30 days later . I am not sure about that. If they believe in a Growth Company, there are companies that are in there because it is a Growth Company or a dividend company. In is a Growth Company. There is activism and hostile takeovers. That is a big thing to look at. Our companies are teaming up with private equity to go out after certain companies. How do you feel about a hedge manager going to a company and saying i am going to buy a lot of stock and i want to to buy it . How do you feel about that . Companies today you have to execute. You have to have a great model. Jim Reid Anderson talking before, he took six flags out of bankruptcy. That is the same with hain today. If youre green, youre growing. If youre going to rot. A great conversation with irwin simon. Elerian at 9 30. Bill ackman at 10 00. Buffett at 3 00 p. M. Those are going to be interesting. Particularly bill ackman. Look for matt levine again. Elerian is making his first comments since he left pimco. What he thinksow about europe and disinflation. To do now . You going mohamed elerian, he is one of the Brilliant Minds of the bond market. Warren buffett on, are we going back to the 1980s . Lets get to our agenda. President obama arriving in tokyo. He is having dinner right now with the Prime Minister of japan. This was the first stop of his tour of asia. That does not include china. China will be the backdrop to all of this because of the disputes over different regions in the area. Newhome sales. There is the president and ambassador kennedy. Cool. T is newhome sales. We will see if they are cooling. Yesterday, existing home sales were slightly weaker. What about newhome sales smr those numbers come out at 10 00. We are looking for 450,000. That will be an increase. In other two numbers we have the past two hours have been weaker. For reportures was fascinating. Full coverage of the Apple Earnings this afternoon. The use of cash exercise come boring, no new products. People expect iphone sales have tapered off because s5. He launch of the galaxy people say a big screen will drive the next upgrade cycle and they will win back market share. We are going to hold ipad minis up to our years. Do get a loth of pressure on this from Board Members . We are doing lots of acquisitions. We have doubled our employees in three years. Opening an midst of office in india and adding 80 employees in india. Do you need to plug a basmati rice . Lets stay on that topic of groceries. Our twitter question of the day is what drives your grocery choices. The first answer is discounts. The second answer, the number of ingredients in a given product. Less is more, maybe. Finally, convenience. I think convenience is a premium for me. Where did cale come from . . Where did coconut, pomegranate. The stuff is been around for many years. Kale. Bloomberg surveillance continues on the radio. Betty liu will be speaking with mohamed elerian. Warren buffett caps off at 3 00 p. M. Have a great morning. Good morning, it is wednesday, april 23 and we are live from bloomberg World Headquarters and you are in the loop. We have Must Watch Television interviews. First up is my exclusive interview with mohamed elerian. We will hear for the first time how he feels about his famous exit from pimco. It caused an uproar in the financial world. Then activist investor bill acton will join what Market Makers at 10 00 and at 3 00 this afternoon, i will talk with warren buffett. It all starts right here about an hour from now. Here is a look at our top headlines according to david einhorn, we are in another tech bubble he is getting that she is betting against tech stocks that he thinks will fall up to 90 . Does not say which stocks those are but you can figure those out. Boeing has firstquarter earnings that Beat Estimates and sales rockets fell. Sales profits fell