We dont know if this is politically motivated. There are some indications that it could be. Threatgovernment cited a posed by the Islamic State and raise the terror rating. A sweeping victory in japan gives the Prime Minister a mandate for his reform package. It forced leader of the opposition to resign. Thirdsnt more than two of the seats in japans parliament. Obama congress is getting a green light for stricter sanctions on russia. It allows them to send russian weapons to ukraine. It is the largest leveraged buyout this year. A group led by a British Company is buying petsmart. Beat out another firm. Petsmart has been hurt by other retailers. Holidays,et near the its the busiest day of the year , mailing day. This is a rush for the Postal Service. Henan 40 handle a six million cars and the packages today. The post office as you can wait until the 20th. Amazon is saving the u. S. Postal service. Lets do a day to check. A nuanced data check. Yield does nothing. Its back to where it was on friday. West texas gets a bid. That is up . 33. Vix is showing attention. It is 62 a barrel. The ruble goes just to 59. With a bid on oil, russia continues to deteriorate. India has a difficult weekend. We dont often look at that. Indias currency weakens. Never go to australia. The news that we saw last evening, they confront islamic terror. Behind elizabeth street is martin place. Five hostages have escaped from a chocolate shop. Juliet, tell us about downtown sydney right now. As weere be any normality going to tuesday . That is what the new south policeremier and the commissioner have called for in the last hour. This is a tense situation. A number of hostages are still being holed up in the cafe. Pedestriane is a place. It was shut down by police. Area, itu work in that will be business as usual tomorrow. They are expecting public will operate as normal. Weve been reporting that the shooter has ties to the Islamic State. Q telecine else about him . We dont know if he does have ties to Islamic State. There has been unconfirmed reports from some of the five that escaped earlier today. S flag. Asking for an i he was getting them to hide up another hold up another flag with arabic writing on it. That was not linked to the Islamic State. It is other terrorist organization acclaimed to that flag. Police of said that the gunman is known to them. They are trying to lock down a number for that persons social media account if anyone it could be tied to him. They are confident there is only one location that he is taken hold of. There were reports earlier that there could be bombs throughout the city. Police are not worried about that. You have been there recently. My former employer was there right in the area. This was a big pedestrian mall. It was a great place to stop for coffee on your way to the office. Its not an accident. This is the financial heart of australia. Is the equivalent of something happening on wall street. Its right next to the central bank. Its near a financial hub. Its not a chance location. We are thrilled to bring in guy kawasaki. He knows a little bit about social media. He is known with apple and facebook. How money books of you written . 13. When you look at the sky, the linkage here of terror to the speed of your social media. They are entwined. Information is fast and free and you cant stop it if you wanted to. We saw this with the rebels in colombia. What did you observe in sydney on your last sojourn down there. Popular city. Its a great city. No one on this desk would have any idea. Obviously, they have had these sweeping raids. An 18yearold was shot. The terrorism alert was raised. Are shocked people by this . Are people in australia racing for something terrible like this to happen . I dont think so. I spoke to one of my colleagues this morning. He assured me that everything was fine and they had been locked down the office and dismissed early. There was a sense of calm. The most troubling aspect is we dont have any sense of one of the hostage taker is actively and i could to a group in the middle east or if he is a pretender. The government has not has been worried about increased recruiting it. We will follow this throughout the morning. The markets are front and center. Carl is with us. Its the bounceng in oil. Would you think about over the weekend . How low can oil go in the first part of next year . Until one of the major producers blinks, we are going to see a decline. Will it change the fed meeting . Tothey should not respond price spikes. I dont think they will significantly respond to this. Wordsy wont say three about it. Item the statement will reflect that. She may highlight this in the press conference. Low oil prices are positive for the u. S. Economy. Oil pricesthat lower make it harder to get to inflation. That something economists are aware of. Thats not the type of reflation they should be responded to. They should be responding to longterm trends in a onetime spike or trough to to a dramatic move in the price of any commodity. This flies in the face of what bill gross told you friday. Absolutely. There is some real disagreement with the fed will do. The u. S. Is a net oil importer. It hurts some sectors. This is a positive for the u. S. Economy. That. Udley believes we will see more in Janet Yellens press conference. Had you see this rippling across emerging markets . We are not sure how to take this news. That oil importer or exporter. If its an exporter its a problem and if its an importer, its an economic stimulus. It should make a big difference in india. We will see. I am looking at the russian ruble. Its 59. 23. Its depreciated since weve talked. It is outpacing last weeks jokes about Vladimir Putins age. Get the hummer one. I need to worry about elon musk more than anybody else . Do you think this will have an on Renewable Energy . Is the tesla high status by . Both. We look at face back in apple here in a bit. On surveillance, petsmart has been acquired. We will discuss the financials next. This is bloomberg surveillance here co we are streaming on your phone. Good morning. We are in better shape than we were thursday and friday. Futures are up 101. Here is olivia sterns. The biggest deal of the morning is the largest of the year. Petsmart will be acquired. Tom is on the brink of buying a cockapoo. That is a 39 premium. We have not really seen a lot of private equity leveraged buyouts this year. The stock market has been doing so well. It made little mergers and acquisitions a little bit more attractive. This was a very competitive option to buy petsmart. They beat out apollo and kkr. Nobody could figure out why petco has been doing so well versus petsmart. Petco has already been taken over. For like the website petsmart. You are not supposed to feed the dog people food. We are in trouble. The 500 pound gorilla is amazon. They have been driving down prices. Can anyone be amazon . Hard to imagine. Pets. Com one steroids. They want to sell you everything. I wife ordered something on saturday night and the Postal Service sunday morning livered. My lord. Can you imagine this with apple years ago . We hear a massive debate about retail recs and mortar and amazon a. To you by the retail analysts on the channel . Is this just a bunch of baloney . I think amazon wins. The chew not browsing toy and then actually going into the store to feel it . There is a value in having points of presence. They have a warehouse. You have been trained to think of it as a warehouse. You still go into apple. You dont go to apple. Com and buy everything. I love that. Best case, look at apple. Thats not fair. I am going to get the lab a bed that prevents it from snoring. Not a lot ofn sleep because i have a snoring lab. This really shows you the paulson enthusiasm. We last sawhen these private equity firms compete to do these big leverage buyouts. It won out against kkr. It was very competitive. I wonder if this is a sign. There is an activist investor driving this. Has been urging petsmart all summer long dont take out any new debt. Lets deal with your problems by getting a sale instead. Here. Winners is there anybody not of the list . Everybody was involved in this deal. Isthe way you win in the end taking a little piece of every deal. Petsmart. 8. 7 billion. Thatat a they getting pets. Com missed . Its the example of a failed and annette company. Internet cap he. Internet company. Amazon has critical mass. Its a kneejerk reaction where of a low equals safety and amazon equals binary thing online. Whos counting . Coming up, we will speak to pamela paul. This is important. It still works. A New York Times book review, i look at it every week. Its the one thing from the 70s that still make sense. What is your book of the year . Well be back. Are you kidding good morning, everyone. Bloomberg surveillance. Right. Ok. [laughter] the russian ruble is weaker this morning. Was . E you know what that else on a shelf, tom. The elses everywhere. Else is everywhere. Is everywhere. It is sending a list to michael bloomberg. You are going to like this one. Minister writes an oped in the wall street journal. Physical0, our consolidation has been accompanied by an increase in business in investment. I was over there and our member talking to him. He is due to speak at the new york economics club. He appears to be on a victory lap. I dont know if i would subscribe the same solution to a lot of economies. Austerity in the early stages of an economic recovery. Men the economy and then further down the road you with the austerity. That is what they did in britain and it worked. Rarelyid it here and we squeaked through. We did qe as well. It is a bad way to slow the economy down or hit the brakes as you are trying to accelerate out of a recession. The standard paul krugman how much pain to cause in the meantime . A lot of unnecessary pain by weakening the recovery. Distant wishing between the economies that it will work for and the kind it wont. Board, i think very recklessly. Quickly, california. California was in terrible shape and its doing better. All in all, its gotten itself out of the mess. Maryu tell i watched poppins this weekend. Thank god for social media. Does it feel like you live in an austerity freezone . Its lala land. At least you know it. Like every word is feted. A little bit. Im looking forward to it. He speaks tough. I am looking forward to it. Olivia sterns is going to get them off script area. Im so happy we are not talking about petsmart. That is my quote of the day. Come, we will talk about linkedin with guy kawasaki next. Is this the undervalued social Media Network . Applel ask the chief evangelist after the break. What is your book of the year . Tweet us. Make the best entertainment part of your holidays. Catch all the hottest handpicked titles on the winter watchlist, only with xfinity from comcast. Futures up big. Olivia sterns and Brendan Greeley with me. A hostage crisis unfolding in Sydney Australia at this hour. With ties to the Islamic State holding a group of people inside a chocolate cafe. As many as 15 others are still being held. Hong kongs prodemocracy protest appears to have ended for right now. Authorities have dismantled the last rating protest site. Than 10 holdouts who refused to leave were taken away. Demonstrations blocked hong kong roads for more than 11 weeks. Service inn the uber france. According to the ministry judgeman a paris rejected to do just that. It is a popular Smartphone App that allows users to get rides with private cars. This does not affect uber generally in paris this is about uberpop. Thank you for your great comments on social media guy kawasaki says shut up. That is his advice in what one should do with certain kinds of social media. Will linked in15 have. It will have a fabulous 2015 people are needing realizing they need to be someplace were they are serious and they are who they are and are aware of the consequences of what they are saying and the integration of slide share a big deal. What are the worst practices of twitter that linkedin can learn from. Such a wildecame west phenomena. Everybody is running and gunning and linkedin if you are thinking at all, youre thinking what are potential employers and potential customers thinking. Nobody thinks like that on any other social Media Network. For the sake of argument, i love my job. [laughter] hypothetically. I love my job why do i need to be unlinked in . On linkedin . Your job might not love you. [laughter] am i really going to endorse tom for mixing a martini top on my list. Or for being a friendly skipper there are a lot of things that dont make sense to me. Some of it does not make sense but a lot of it does for broad professional areas. Whats great about this and their dispense defense some of the things are ridiculous what is the benefit to corporations . Has it literally become a jobSearch Engine . It is a great job Search Engine for a company trying to find people but a great way to give references. If summary says these are a bunch of my references by definition that person is giving you someone who will say positive things but it you can find out i know other people who worked at apple and lets see what they say. The great challenge of social media has been, how do you keep people staying rational and good . Has a great 2015 how will it retain this sane, sober reputation. Fundamentally youre on linkedin for business reasons you are not there to show you are drunk and had a great party. That is a powerful tempering source. Maybe there are 10 people or with that can really talk any credence about the shift from steve jobs to tim cook. Tim cook just announce as men of the year and we had drama here on Bloomberg Businessweek where tim cook wrote an essay and our team your thoughts on this transition from mr. Jobs to mr. Cook . In a sense he has full that pulled it off the numbers and market share are great. The longerterm question is Product Development . Does your six plus get it done . I have to say there are parts of android that i prefer. While the stock is up 37 this year do you think apple can have a good 2015 . Every year i say no and every year i am wrong. s apple a luxury brand or technology . Luxury. Did you know that when you were there . Know it wasnt when i was there back then it was supposed to die. When did you see the shift . With the iphone the i whatever. It took out lets fight all those ibm clone computers and took it out of that into a brave new world called smartphones. You think it was a good idea to never let the price of the iphone be driven down . Yes in hindsight but i would never have predicted that. Within this is the idea of ecosystem how does guy kawasaki defined ecosystem . Anuntil two weeks ago i was Android Phone user then i found out they have one particular application that is very powerful for their platform and without it you cannot post efficiently and i need to post efficiently so i switched phones. I switched a couple hours after. What percentage of android are switching to apple now or in the next year . Very low. Very. The traffic is going the other way on to android. I think there is a growing if you are a believer that it is a luxury brand, you should stick with it. The irony with macintosh people defaulted to windows it was an unthinking decision. Now it is true about ios. Weve want home and another one here the computer has had a pretty good year, right . The argument is the phone is helping the computer as opposed to vice versa. Once you are locked into a system you stick around. Its entropy. Did you say entropy . I did. Thermodynamics on a monday. The second law . Thats right. Ok folks, nerd alert here in the next hour, robert engle will join us. On bloombergome surveillance. Were speaking with our guest host guy kawasaki, will twitter ever catch up to facebooks popularity. And we are talking about the elf on a shelf. Have one here onset looking as to whether or not tom is on his best behavior. Futures up 15 you think it is green on the screen forget about it. Russia is to seriously deteriorating this morning. Here is olivia stern. Facebooks crushing it, we are focusing on the social media. We know they are the most popular social Media Network, but as todays chart shows it is growing the fastest. Calledmes from a firm shareaholics. Role in traffic pales in comparison to facebook. The secondlargest source of social media traffic is pintr est. I tried it and left. It doesnt if you started one about your bowties you might get some. Guy kawasaki says you are not on interest as though he is shocked. He is the author of the art of social. Interest is the least amount time and you would be awesome there come. I tried it and no one was there. There is no there on Pinterest Pinterest is a quiet social network, you pin something and. Olivia that i of like best. This one is lovely. Thank you. Tom and i we talk about this a lot facebook losing relevancy we go on lefts and less. Less. Nd lists i will tell you one thing wrong with this chart it shows such a decline from twitter but many people use Something Like tweetdeck. If you are using an app to access twitter you do not get counted. Its not exactly the real world. I want to talk about facebook here in the newsfeed what will they do to dominate . There already dominating. They will pull the New York Times and every News Organization and dont they become the front page of the world . One of the dangers of facebook is theyve decided that fewer of their followers will see growth they want you to pay for that so does that kill the golden goose . That is a dangerous thing. Can they be as responsive in terms what we want and continue to dominate . It depends which facebook you talk about. It seems i could change the terms of Service Every week that is a tricky thing. That almost seems like a feature, not a book bug. I dont see how thats a feature but ok. Facebook him on board when i was in the middle of college along with it came lots of photos from acapulco i dont have a turn those off. Member sending my first email in a lonely computer lab yes facebook in college, continued. What is Brendan Greeley doing wrong hes a news anchor what are the best practices . Promoted posts to get more likes. So i have a private Facebook Page i need a public one as well. You absolutely need a public page. Ones, i need to put people. Give commercials on tv and do those people pay to get the if this is part of my job, how much time i was famously very wrong about twitter deeply wrong about twitter, how much time do i have to be spending on social media every day you dodged this question before, how much. I was a 50 minutes in the morning and 15 minutes at the end of the day. Its really not that timeconsuming just like that and that an ab workout and i am done echo an ab workout and a little 3d. How muchstrong time you spend on social media . Try to do less and less and i think im succeeding, my major message is facebook, i completely underestimated it has itse much more profound, fascinating where they are the end of next year. I was offered a chance in 2006 to help facebook figure out how to work with journalists and i put the phone down and i turned to my cubicle mate and said i need to tell you about the dumbest idea i ever heard. I would be retired today. Number three frodo, i will be running my own drone business expo,s the first drone our number three photo, sponsored by the commercial Drone Association as we all the, known by the actor issue here is the faa is reticent to give licenses to drones for commercial use, theyre behind a lot of other countries there. I want a pizza delivered to me by drones. One flew by my window last night are you kidding me . That one of the things we can opaque plea predict your future behavior . Thats a great idea. When you do that well call me . Practicing drones. Cover two photo on the desk. 25,000 people. In new york city following the death of Michael Brown and eric garner that marched through Washington Square park and the brooklyn bridge. They coincided with demonstrations in washington dc and chicago. This continues to be important. I could not believe the amount of people i thought tens of thousands crossing broadway just supposed to marry people as like this for mrs. Clause. Thisu worldwide explain this is our number one photo, this is santa con, if you dont know what happened this everyone dresses up like santa claus is drunk and santa rampage is the most amazing thing that has it is a if you are much of drunk people wearing red. Commented that help the in a santa suit. Like the running of bulls. You should come on every morning. Belly laughs, i like it. Coming up, the holiday phenomena built on social media and running my life. Were talking about elf on the shelf you have to move it every night because i get up early it is my wifes job. Good morning everyone, bloomberg surveillance. In our next hour, one of the most interesting american nobel laureates, robert engle will join us on the mathematics of our linkages. He is the expert on correlation. The perfect time to speak with angle. This is bloomberg surveillance. Russian ruble is simply in freefall we may get to a 60 ruble if this keeps up. Look to our top headlines. The longtime ceo of bob evans is stepping down the company says he is said resigning under mutual agreement with the board. Davis will remain with the company through the end of the year. The number of Airline Seats on offer in nations hit by ebola is plummeting. A new report by flight saysuling database liberia, sierra leone and guinea will see a total of 95,000 fewer available seats than one year ago and liberia was see and 81 drop. Ebola has killed more than 3000 people in that country. Sony pictures has a message for news at news outlets everywhere, stop exposing confidential information. The famous constitutional lawyer says Media Companies should destroy the information. They will be held responsible for damages from its publication but how could we resist the smack down on angelina jolie. Youll be held responsible for practice of the First Amendment . Sony shouldve secured the system little better. Upthe futures improving 16. If you are an elf on the shelf family, remove your children from the room because on the set with us is china bell who in 2005 wrote the book about the elf that monitors behavior. It is a brandnew and universal christmas tradition are the children gone . Im conflicted. Children under five and the elf on a shelf is an amazingly effective shock collar on their behavior they fear it and its wrath and yet there is so much work to do every night we have to remember to move the elf what have you done to me . Elves of course use christmas magic but what i like to tell people is, the elf can become located or simple it matches the personality of your family. In our home, the elf flies and talks to santa in the north pole and lands in a different spot. Did it get away from you a little bit . One of the things we saw was that through social media it became something more than you had imagined. I think what makes a great tradition is the idea that a family can incorporate it in a way that makes sense for them. Her family like i said flys to santa and lands in a different spot. People are embracing the tradition to make it their own. Sounds like brainwashing. [laughter] we have a lazy elf, sometimes he stays in the same place. You were talking about how it spreads. On interest its really popular and people share ideas. There it is. Im sure he has special permission from santa. Im a bad boy . Christos badgett is very fragile. Christmas magic is very fragile. How do you also run a company . How do you take it of that without puncturing the beauty of tradition . Is about being passionate about the tradition and to guarding it. My sister and i run the company together most people dont know we are still a familyowned business. We started it ourselves. The book is self published . It is. Wow. Im surprised for you, that elf on a shelf is such an a norm is popular hit there have been ripoffs. I found a mensch on a bench. It andre talking about this is for jewish people who want their own tradition mensch on a bench. They should. Elf on a shelf is from the 50s, correct . This is summing that was brought back something that was brought back . When i was growing up santa would send a shelf to our home. During thed to watch day and report to santa at night and in the morning fly back. Thank you for ruining my life with a beautiful thing. You are following us on facebook and twitter, instagram, we are everywhere. X,thank you so much, four the ruble on the move a much weaker ruble. Monday evening in sydney, australia. They face a possible terrorist situation. Five hostages escape. Could receive further depreciation in this hour of the ruble and there are 10 shopping days until xmas. When in doubt, looks. Books. Scarlet fu is buying books this morning, olivia stern is with us. Time for the top headlines. Situation in sydney, estoril you where a gunman with possible ties to the Islamic State is Holding Hostages in a chocolate cafe. Five hostages got out and it is not clear if they escaped or were released. Been holdinghave up a black flag with white arabic lettering and there has been a report that he is demanded to speak with tony abbott. Plan and our only goal tonight is to get those people currently caught in that building out of there safely. September, abbott cited the threat posed by the Islamic State and raised the terror alert to the highest level in a decade. Has paid shinzo abe off in spades. He called for early elections and the results were a sweeping victory that give him a mandate for his abenomics reform package. Seatthan two thirds of the in japan. Congress is giving president obama the green light for tougher sections on russia they sent the president a bill with new restrictions on energy. The key is that the bill authorizes president obama to take action but does not require it. Year, largest buyout this the group has agreed to buy petsmart. Priced at 8. 3 billion, they beat out jk are and Apollo Global management fell into the black last quarter. The chain like everyone else has been hurt by competition from amazon. It is a mailing day today, the busiest of the year and the holiday rush is on for the Postal Service your member them . Cards, 639,942,000 are olivias cards. That is 500 more than last year. Her procrastinators, the post office says you can wait until the 20th and they will get the meal mail there. They had a high level momdebt summit and set all presence will be ordered today. My closet is full of amazon boxes. I got the post office to deliver on a sunday. Things change. Equities, bonds, currencies and commodities rebound off thursdayfriday carnage. Oil itdollar and is ever so fragile, 58. 39. Brent crude is 62. 85. To the seriousness of the moment in australia, they confront terror. Street is theth fancy martins place. You go there when youre in the financial business to get a cup of coffee, five hostages have escaped. Know about do we this lone gunmen . What we do know is that he is known to police the number of Media Outlets do say that they have been told that the hostages have given them enough havemation that they worked out who he is but police are asking that the media did not identify this man there are reports he is known to police and is out on bail. Tactical partthe of police separation is to keep as much as they can close to their chest as we are now into the 13th hour. This is not the first incident in australia and the last year, can you give a sense of a height and awareness they have had . Handlice were very much on and ready to act because there had been an increase in terror alerts in september when they carried antiterrorism raids across new south wales, queensland and in melbourne where one man was shot dead in an antiterrorism raid. When those came to light, they were on foiling a plot to behead isis. E by the group this had been indicated as a central target and is the hub of the city. A lot of people going to the shops as well. One more question, what will happen tonight . It is monday evening in australia what is the plan of the story into tuesday . Unfortunately, we have not heard much from the police for about one hour and a half. I would imagine the operation will continue and they do have contact with the gunman and are keeping their operations close to the chest. Now you cann cindy imagine how frightened the family of those being held in the cafe are feeling. There probably going to be spending the night there. The cafe was seen switching the light off, whether the police told her to do that or the gunman did it is getting quite frightening. Australia. Om sydney of late lastnage week, bonds and oil he has enjoyed a nobel prize from f i will never understand but first, our collective Breath Holding on oil there was no other topic this weekend but the future of the highyield market how much is a challenge of the energy highyield leaked over to the rest . It has leaked over and you are seeing body yields rising to the most and more than a year. Clearly the names not related to energy are getting hit. Mattersf a sudden price , are they seeing redemptions . They have been seeing redemptions last week was a big redemption week. My sources are saying that probably redemptions will be ongoing to some degree just because if you have a miserable investor the highyield bond is relatively risk fee and theyre starting to see losses and their significant. For those of you who dont have a cfa when he says price matters he is saying people are starting to panic. You should have a nobel prize. Win for abeno mics is seen as an endorsement, doesnt it have the endorsement of robert engle . I think it does, he came into power with a plan three arrows and it. It was quite effective in the beginning, it lower the yen and the stock market was happy, that it stalled. It stalled in part because they raised sales tax and he wants to do more. That is what exactly is needed. Institutions and managing the story and the plot olivia you and i were talking about this morning, a stunning reversal in the russian ruble, dramatically weaker. Not so much white is the ruble going down but is the bond market going to become so destabilized we dont have the control that are lesser angle speaks of . This is a big concern of the businessmen and russia they have been lobbying washington politician saying, no more, no more. You can see this movement in the ruble what happened is the one thing nobody expected which is that Congress Gave the president the green light with his own authority to vote for sanctions. To me it was really telling that the businessmen and russia were lobbying washington directly they will let get an audience with putin. Moscowrting from our news bureau, that the economic elite are still separate from putin . There is certainly a diversions, putin will dig his heels and and not give up so easily. Clearly the sanctions have been eating into the russian economy and plunging oil prices are causing a huge point of concern during its gone up up. Many think the penny will drop for putin when the elites change their tune because they have suffered enough pain. We had this great interview he thinks there is a 5050 chance that putin is pushed out of power in the next decade. The next decade . [laughter] and the jets will win and the cubs will take the pan it pendant. The lead opposition and some of the Opposition Forces will exile him. Time for the twitter question of the day what is your book of the year . Tweet us. Lots going on on monday morning particularly when robert engle shows up this man is now to Professor Robert engle. Re looking at singles signals and hopefully they clarify but can a single american model workout with two or three or four americas . About that there could how about that bell curve . You got your first gray hair your sophomore year in college. All of the models are based on one curve usually a simple bell curve. But john edwards and others say thing forget about one curve when you have many in america the you buy it . Do you buy it . We use many analyses. We allow the possibility of much more extreme events than would be predicted. That is the way the world is the world is continually a surprise so the bell curve does not capture that. Fistfight going on among 300 people about who to blame for the financial crisis and steve roach and rabin he and all that robert engle stood up and quietly said we learned a lot. What did we learn . All thatrned first of the whole economy could be brought to its knees by a weak Financial Sector. Its correlated together in the bell curves once we figure that out, everything moved together. All the correlations moved between countries and sectors. Are we there right now with oil and russia . I thinkt think so there are big diversions is across the economy the u. S. Economy is pretty strong, china is weakening, europe is fragile and they are lowering Interest Rates in some places and changing them in others and we are not going the same path. The reason for oil it seems like that is the Common Future but that is responding to the weakness of the european and chinese sectors. Does anybody on wall street even read engle . Is there any humility . I think there is a lot of humility on wall street. Where are the biggest opportunities . In management and regulatory processes these are the things people are concerned about. Robert engle of new york university, stay with us with rubel on the move and a better equity market. Good morning everyone, bloomberg surveillance. Im tom keene and scarlet fu is off buying books. Olivia sterns is here and Brendan Greeley as well. Top headlines. Then hong kong prodemocracy protests appeared to be over, authorities have dismantled the last of the protest sites. More than 10 holdouts refused to leave were taken away by police. Demonstrations blocked the roads for more than 11 weeks and a number of Airline Seats on offer in countries hit by ebola are plummeting. Oag says liberia, sierra leone and guinea was he a total of 95,000 fewer available seats in january than one uric one year ago. Preparing for the 2024 according tocs, italian Prime Minister. He tells the italian newspaper, our problems should not stop us and dreaming. Last year rome pulled its bid for the 2020 bid and then the permits are said it would be a drain on Public Resources and publicly im skeptical whether hosting the olympics in the coliseum is the right move to get it out of its budget woes. A billashington we have a palpable bill. Bill mattingly is the White House Correspondent this was a bill written a script written this was a script written a year and a half ago, did we learn anything about the senate . Things, first, what ted cruz and republicans had going on open the door to harry reid to move nominations through. What we learn from this is something we should of known, harry reid is a master of senate or seizure. He will be the minority leader in here year but he tied republicans and not stashed just imagine what he will do when he no longer has to deal with his own majority and the white house. Elizabeth moran we have always known she has major sway with the grassroots of the Democratic Party and over the last weeks we recognized that not unlike ted cruz with different tactics she has power over the broader them a craddick lawmaker base and that is a big deal and means a lot in the house. The final thing we learned is we hope wall street enjoyed the repeal they were able to get out of this bill because what they ought but slipping this into an appropriations bill was heat and light and raised Elizabeth Warren profile 10 times. With that speech about citigroup i guarantee that will have a million youtube hits by the end of this week and wall street will have Major Pressure into january. That is the one fact repeated again and again which is jamie diamond whipped votes in the house. But thede calls interesting thing on that is jamie dimon was lobbying on this and he has great relationships on capitol hill and has had them. Just watch the Senate Hearing on the london whale where nobody took a shot at them at all and you recognize that this is an individual with great relationships he was making the calls but Elizabeth Warren never mentioned him on the senate floor she mentioned citigroup and citigroup only which is an interesting dynamic. Is it the easier target . But jamie dimon makes the calls and does all the major lobbies and citigroup is the one that gets hammered. For the Public Relations team based on how that was happening. That was a slip but an amazing one, the city floor instead of the senate floor. Poll, the oped called wall street revenge, how bankers got washington to bring back moral hazards. Handing president obama more authority to ratchet up sanctions, does anyone think that will happen . What we saw is the white house was very concerned about initial drafts of the bill they knew it would move through congress and move through the senate and the house unanimously but it changed for the end of the process and there are key changes. They give the president the authority to impose new sanctions specifically on broad Energy Sectors which is very problematic for the european allies but dont require him to do it. The White House Position on this has been, they dont want to make moves without the eu and they feel they are most effective when they have a unified front. I think the white house maybe likes the fact that this is working them a little bit but you will not see as much as ive been told up to this point, it is very unlikely you see the white house move forward on new sanctions even the sanctions they have been given the authority to impose if they do not have eu allies with them. Of all we have learned of the doubt democrats during the spending bill is that elizabeth morans message has poll, what weve learned about the republicans is ted cruz was able to get 23 votes for his useless parliamentary and over, one from rand paul and arco rubio. 26 2016 matters and it is only on their minds. Look at the vote on the final spending bill itself, if you are possibly being mentioned as a candidate possible for 2016, you voted against the spending bill that is Elizabeth Warren, ernie spenders, rand paul, marco rubio people are already taking into account 2016. Positively miserable for anybody who covers this process but it is noteworthy because every vote evening forward Mitch Mcconnell as a leader working with john boehner and a speaker, the 2016 dynamics are already playing out and all that will do is cause problems for any dealmaking republicans want to white house. Near rubel very ruble very near a 60 print. Here, part holiday sense looking around at some of the elements of the market, economics. Then there are telling moments, let it go, let it go she stood on the stairs and looked down it clark gable and said let it go, let it go. That is the worst southern accent i have ever heard. You should be ashamed for what you just did. Fear that tom keene has lost the south for a generation. Are talking about this, 75 years ago today, the theater in atlanta opens for the premiere of gone with the wind. Streets andned the clark cable was there and so was vivian lee, the actress who today helped define the American South. Witness, immy going to live through this. I will never be hungry again. If i have to lie, steal, cheat or kill then god is my witness, i will never be hungry again. Thats really got elsa from . Yes, that is her holding a a for after the war real film, that is before the intermission. The film is screening today at the gone with the wind is he him and marietta there are a lot of reasons why this film has an doer and it is part of the way the American South still defines itself today. Anybody in the south can quote almost all of those lines. My mother was addicted to the film and said it was changing for america ec the passing of the southern democrat guard in the south which alludes back to this 75 years ago. This is a reason no southerner will support the Democratic Party. One of the things that i learned it took until i saw this movie to understand a lot , a lot ofabout her feelings model directly on the film. Julia was undergraduate and i was in colorado and it was boring but what people today dont understand is it was even meadows down there. A totally different space. Here is something to point out, had a mcdaniel the black actress who won the Academy Award was not invited to the premier. Thats why i think the question of its relevancy is a good 1 i was reading a good aticle on nprs website about reporter who interviewed georgetown film students most of them had not seen the movie and they said look, it is a movie that is inherently racist that portrays an artificial view of slavery for my gender perspective she is raped by her husband and wakes up in a great mood the next morning. It questions relevancy to 2014. It is interesting and as you said, even back then the fact the cast members could not use the same bathrooms. Clark gable made a point of that onset. Some of this with respect to time, is it so much of this movie is framed by carol burnett. The curtainsusing and she comes down the stairs with a curtain rod. Carol burnett i think you are alone at the table. [laughter] i will offer another Academy Awardwinning art actor who played brashly. Keep talking. Here is another opinion, Robert Osborne is a film critic in the l. A. Times, trying to explain to me about all the things wrong with the movie and there are some things he gets right it is about survival in the 30s when europe was going to war and just before we went into the war. Everybody has had someone and a life that they love more than they love them back. Was almost four hours long, when was the last time any of use sign movie longer than three hours. People didnt have smart phones in their pockets to check the twitter on a sleepless night in 2001, i was up and this was playing on cable and i watched all four hours it held up. I agree with all the things that are wrong with the movie, deeply racist and deeply sexist but incredibly compelling. Was it the southern girlfriend the major watch it . I talked to her after and she said you learn how to flirt from scarlet ohara. Let me do a data check right 75th anniversary of gone with the wind, the 75th minute of markets churning on a monday. Futures up big but that barely describes what we are seeing, oil catches it big and only then in the best story the ruble simply implodes. Russian ruble 59. 80. Everyone, bloomberg surveillance. Im tom keene and markets are churning in. Butler onot have rett stage but we do have robert engle. He won his nobel prize for finding a better way to model volatility. Thousands of economies have added bits and parts since he published he turned it into a tool. The v lab shows which banks in which countries contribute the most risk to the economy. Talked her angle, you dont believe in stress tests. Engle, you dont believe in stress tests. I do but i dont believe they are often done very well. What we do it the lab could be interpreted as a stress test. We let the market determine what the value of the firm estimate what the value of the firm is rather than accounts. Of the things about the market data in the last eight months is the big shift was japan was the single biggest contributor earlier this year and it is now china. China has a Banking Sector which is in need a lot of help. If you think about what we worry about in the u. S. We worry about them being too big to fail but in china they are already state owned and there is no possibility they will fail. In china did they recognize this . The Volatility Institute that i run has now set up a branch in shanghai called the Volatility Institute at nyu shanghai. Weve translated the whole website into chinese it has loads of chinese assets and is getting a lot of attention. It talks about the weak banks in china and what can be done. To be honest, with your great acclaim, Peter Bernstein wrote against the gods and put you in one of the last chapters it was a great honor. But between risk and uncertainty can we model china . Are we talking and china more about nonprobabilistic uncertainty rather than the certitude of some probability distribution . We are always talking about of ability distribution in china . In every market. If you are the in china you have to be a risk manager. What if im it bank of america and i want to deploy capital, do i have a clue . You of course you have a clue. Of the risks in china . A lot of the banks have not moved to china because they know the risks are high. I think one of the things that would be very important part of the policy mix in china is to take some of these free trade zones and make them include reminbi conversion. So give us data to work off of. And give us a way in and out. She measures value risk and bond yields. Wondering how much of the risk has moved away from the banks and into the hands of investors and whether the market is safer you think that is the case . We look at the leverage of the banks, that is one of the key features. How much equity compared to liability and also how much volatility in this equity to see are you on the verge of failure . You and i sat after midnight one night in a piano bar. Things only tom keene says. We were at a piano bar at davos, and someone standing near said they are bewildered are we still bewildered about the markets . 2014 . I dont think so, i think what we are is different experiences in different places. In the u. S. The banks are putting aside more capital and their leverage is coming down and in europe they are static with nothing happening in asia they are increasing the risks particularly in china but also japan. I bumped into you in davos at and a. M. In the piano bar you told me to read Peter Bernsteins the economist. What is your book of the year . Olivia sterns is in for scarlet fu and Brendan Greeley here. Olivia with pictures. It is official, burger king has crossed the border and are now canadian. The 11 billion buyout of tim hortons is complete. Stands to save 1. 2 billion in taxes in the next three years. Weve seen some he inversion deals fall through this year, but this one was not just about taxes it was also about tim horton coffee. Procanadian like he is. One final step in a company that has been successful and able to move their headquarters overseas. In this case over to canada. It is just another statement about Corporate Tax reform here. People say that on the agenda, hopefully congress will tackle Corporate Tax reform in the meantime, it looks like whether or not there will be more restrictions on companies and whether they are allowed to move their headquarters you will continue to see this. And, who is an these inversions and says, frankly speaking every single other country in this world has better tax rates than the United States better tax rates to Keep Companies in our own country. The other people understand what an inversion is but there is a bigger Political Risk with trying to attempt one. You think that has changed at the Way Companies present these and plan them . They does change the way present them because they look at this as a continuing job creator. Theyre not saying that we are doing this even though they are to save money on the bottom line, they are doing it to reinvest the money into their own companies to create jobs eventually. Hopefully for those in the United States. I want to company that says we will do this because we will lose jobs. You are an expert on fast food, icing video of you itpping big macs what is that this 35yearold ceo of burger king is doing right . Incredible right . Im not sure they are doing everything right they had to make this move to buy tim hortons. Burger king and mcdonalds are facing the same problem. Wendys, interestingly enough, has seen seven quarters of positive sales growth. They are selling their burgers even more than they were a couple years ago, how are they doing this . They are emphasizing fresh food, vegetables, salad, chile, they are going more premium than mcdonalds or burger king. We should remember you can still buy a Pumpkin Spice latte at mcdonalds with your American Express points. You are like the salesperson for them. Betty, thank you so much. More on bloomberg surveillance. Good morning everyone, breaking news. To 60, an the ruble ever weaker russian ruble. Greeleytart brendan with what a 60 ruble means for germany this does destabilize that relationship. This is a problem germany has had they need to learn how to lead and with every drop it becomes more urgent for Angela Merkel to do something. Andhas been doing bits pieces and is our lifeline but at some point germany will have to reference recognize that dramatically it has to lead. Ruble weakens beyond 75 versus euro it is not just about dollarruble it is about their entire relationship. Towardything is headed 63, vladimirs age and the price of oil. 60, congress agreed this weekend to pass the sanctions against russia. Brendan greeley, within your reading, is russiazimbabwe, name another country. Venezuela. Even if oil was selling load they have oil to sell but the question nobody can answer is at what point is a drop in the ruble or the price of oil does putin freak out and the answer seems to be never. He has a 260 Million Dollar warchest he is bending it slowly helping to refinance but that is a drop in the bucket to 250 million. I think one of the things were seeing is theyve made it a just decision they cannot protect the price of the rule. That is the key question for economists. They stop or to support the ruble they said they will not anymore and as a result it is losing value dramatically. When they talk about inflation versus stability you get the sense that they are talking about russia as if it is a normal country. Is it time for the dumb question of the day . So illdit default swaps liquid that they are not as accurate a measurement than the bond market . I think it depends which youre talking about, it also depends when youre talking about something moving so quickly, it is very hard to get an accurate gauge there are different investors. We will move on but this is history being made. Unbelievable. Biographies of Vladimir Putin are selling out and china, which is the perfect segue. That was very cool. Only a few days left in the year how will you look back at 2014, Time Magazine put the ebola fighters on their cover and we will always member Kim Kardashians bum on the cover of paper. But this is tv or else i would show it to you some of you actually did read some books, the New York Times book of the top 10. Pamela paul is a book review editor and joins us now. Thank you for joining us, i did see a graphic novel on the list are people still reading books . They are still reading books and them glad you not asking me about russian ruble. There is a graphic novel among can we talknd it is about something more pleasant which is a graphic memoir about her dealing with two aging parents and their death. It was a nominee for the National Book award and the only nominee by a woman it is interesting because this is the most recent of several books that have dealt with aging parents. A sign that they be boomers this point in their lives. By phil clay, a Marine Reserve and iraq and my father was a career marine and i know he and his friends have been emailing these short stories around and incredibly powerful. As enough time passed to see weve seen are few in the last couple of years and more coming out the book redeployment is a collection of short stories and he is a warmer marine one of several. Kevin power also wrote a book called the yellow bird. One of our top a couple years ago. I think what is amazing about the book is that it deals with both soldiers in iraq and also when they come back here and that rotation. Im fascinated by what is not isthe year book, might Henry Kissingers book. No idea who you are talking about. I thought he given a nice alans review of the pros and cons how do you pick the books . Hard, this year what is notable is what is missing. There are no doorstop looks on this year, best nonfiction. Last year there were a huge number of books on world war i and books on the Financial Sector and harry potter. We have a Childrens Book last. Thats where she put the kissinger book. When tom king rings up john nickel for weight, our new boss what hes saying is i welcome our new english overlord. There was a book called on immunity did i get a boost from ebola . I think it is really an extended essay about vaccines and all of our fears around vaccines and our fears around science and what causes anxiety and our fear that there is something toxic and i do think that the a bowl of fear may have played into and hit and a good moment, i will tell you one of these books that i read with terror which was the six extinction from elizabeth colbert, it was a terrifying book, al gore reviewed it for us on the cover and she basically by the sixth extension she is talking about the mass extinction of species and there have been five previous in our history, luckily when before we came on the scene but that we are basically going to see about 20 to 50 of the species currently on the planet die off. 24 months ago i aggressively went back to reading hardcover books, within your world and your expertise what is the trend . Kindle win, book industry . Youre talking to a partisan but i think when you look at the trend in terms of tablet reading, there was a steep increase and that it leveled off. It is still increasing but i think that what is happening is even people reading on the readers there is a trouble between formats were they might take the reader with a travel on business where do you read . I am in ereader i think it is clutter. Its blasphemous but i think i have so much stuff that i dont want all the books collecting dust, i would rather read them on the couch. I buy them in hardcover and stack them next to my bed so i can never read them. Radio has been predicted for a million years and it has not happened and the death of books happens every day. Video killed the radio star. My book was the goldfinch. This is the first thing i do sunday. Dont you buy a bagel . Thomas scouring wedding outfits. What is your book of the year . Winners by bill mcdermott. Got edge of eternity hands down the best book of the year. Capital he answered some important questions but left enough room for further inquisition. Quaids even made bill bill gates stop. He makes interesting points. . Wire none of those books on your list . Not every book can make it. Is there a lot of screaming when you pick a list . Which bar depict the sin . Pick thisar do you in . We just roll the dice. [laughter] i go to many bookshops i still go to barnes noble, i go to looks of wonder which is a local bookshop for children and i go to the strand and there are some great bookstores outside the city, politics and prose in washington the maple leaf bookstore in new orleans. This is great, have i read any of these . I need to get a life. I think with Childrens Books i would prefer the hardcopy and i do not see that ever moving to digital, thank you so the marketmore on this morning, futures up 13 and watching the russian ruble, betty liu next on television worldwide. Tweaks in the market so far this year. Looking to tackle the growing let in the Democratic Party for everything in banking regulation than the market. Lambasting the white house again. Plus, another uber has emerged. Is calling itself the uber of private jets. Why they will succeed where others, including a competitor,ailed just about a year ago serving the 1 . First, heres a look at our top stories this morning. A gunman continues to hold hostages, displaying a flag with