day two ofcovers janet yellen's congressional testimony. and recovers -- silvio burwell's nomination hearing. and we have an update on the crisis in ukraine. but first, the president says vladimir putin plans to go to for a ceremony marking the 70th anniversary of d-day. if president putin makes the trip, it will be his first meeting with president obama and other western leaders since the start of the ukraine crisis, which has longed relationship -- relations between russia and the u.s. to its worst since the start of the cold war. of president putin's inner circle have been slapped with travel bans and freezes. said he wastin pulling back troops from the border and today he says he is testing his army's combat readiness. what is he really up to? >> it is clearly a skin of fred six message. i would love to be a fly on the wall with that d-day celebration and prudent having to sit next to all of the other leaders. putin having to sit next to all of the other leaders. back, vladimir putin came and said, actually, i'm testing the readiness of my eye -- my entire armed forces, including a nuclear deterrent. and there were reports that two nuclear submarines had actually tested ballistic missiles and that the airspace defense of russia had repelled a mock nuclear strike. at the same time, we have russia's foreign minister, sergei lavrov, contradicting what his boss said yesterday, saying any elections on may 25 would be premature and the country is not ready for them. and we saw the separatists saying they would go forward with the referendum on may 11, yesterday, attin least publicly, urged them to pull back on those. >> and how are governments and investors responding to that mixed message? message frome investors already today, that some of the perhaps misplaced euphoria that we saw yesterday has the rally of the micex been tempered today. we saw the ruble dropping today for the first time in four days and the ukrainian currency also going down. and in the same way that investors are not so sure what prudent is top -- putin is talking about, we have seen some wariness on the half -- on the part of western governments. before putin said he was going to be testing his military forces, he had a german envoy saying, yesterday's message was great and maybe we don't have to go forward with sanctions. but after what he said today, i think governments are really deeds, whoa, let's match with words before we pull back on our sanctions or any other policies. >> you covered the congressional hearing this morning with the senior state department officials and the treasury. what was their message? >> that was their main message in the beginning. we have the secretary of state and other saying that what he is saying is fine, but we will judge him by his actions. and there was more talk about electoral sanctions. -- sectoral sanctions. it is harder to get the europeans on board when you have a big group trying to do sanctions together, and the u.s. assistant secretary explained it is also because of the legal constraints that europeans are under. the u.s. can move more quickly with it sanctions than europeans can. at the same time, both officials said that the u.s. is trying to work like a score out -- a scalpel and not like a sledgehammer with the sanctions. and that is really important because they are trying to get the message to american and european businesses that this is not directed at them and that they are trying to and minimize -- to minimize the impact and this would be on investment going forward, not those already in place. >> thank you. we will have more on sanctions and the ukraine crisis coming up. gary hofbauer,th senior fellow at the peterson institute. he will be my guest and about 25 minutes. with al hunt, treasury secretary jack lew will join him to discuss the russian sanctions and the u.s. economy. that is friday night at 9 p.m. right here on bloomberg television. billionngton, the $40 comcast-time warner cable deal once again came under scrutiny. america's number one and number two cable providers made bigger case for thetheir merger. yang yang joins us from capitol hill with a recap. >> that afternoon. comcast executives and time warner cable executives were quite literally in the hot seat is afternoon and this morning. there were air conditioning issues in the hearing room. senator baucus, chairman of the antitrust subcommittee of the house judiciary committee, actually took a moment to's the hearing and explained that if you saw any sweat on any of the that if you saw any sweat on any of the four heads of any of the witnesses, it was because of the air-conditioning problem. that was theh, but only one. but it was not that tough of a grilling as far as hill hearings go. lawmakers made clear that they are not in the position to judge the deal. that decision rests with the fcc and doj regulators. they said that their goal today was to get to the bottom of whether the merger is good for customers. , executive vice president of comcast made his case that the answer is yes. beneficiary of service andd investment is the american consumer. specifically, it will bring customers faster internet speeds, more programming choices, more robust wi-fi, and our best in class x-one operating system. and business consumers will benefit as well. >> another point that we heard comcast making is that there is no overlapping coverage between time warner cable's network and the comcast network. at, however, was an argument that the opponents would not buy. antitrustormer doj official saying that was bogus. take a listen. >> the fact is, comcast and time warner cable do compete. the two companies compete in a number of ways. for instance, they compete to carry local and regional sports teams and they compete for advertising dollars. >> other opponents were well represented at the hearing as well. other arguments that they were making is that it gives comcast anti-competitive leverage them and that comcast could become both judge and jury in this hearing where congress has no say. this is really up to the fcc and the doj. >> thank you. --ing up, beating animals zillow beats analyst estimates in the first quarter. and we will talk about the recovery of the economy in the united states. ♪ >> federal reserve board chairman janet yellen spent a second day on capitol hill spelling out her latest views on the u.s. economy and defending the central bank's actions. bloomberg's chief washington correspondent peter cook has more on her testimony. stray fromlen wednesday's message? >> she didn't stray too far, especially when it came to the economy. she reiterated many of the things she said to the joint economic committee on wednesday, but she did get dragged into some other areas during the q&a session with the committee. but to the larger question, the economy, she says is doing better after the slowdown we saw in the first quarter. it is doing well enough that the tapering of the bond buying program can continue, but not well enough for the fed to start talking about raising interest rates. >> in life, there is a considerable degree of slack that remains in the labor markets -- in light of the considerable degree of slack that remains in the labor markets, a high degree of accommodation remains warranted. >> senators today were pressing yellen on the fed ex's strategies. specifically, she ignores, that it could take five years to reduce the numbers to precrisis levels of $800 billion. interest inno returning to that of the 1970's. fedon the broader issue of policy in general, she pushed back at the criticism that it is creating uncertainty in the economy and doing more harm than good. >> i think there are a number of sectors of the economy that have responded favorably to a policy of low interest rates. it has helped stimulate demand and job growth. it has been one factor that has been helpful. again, i would not say it is a panacea. >> senators tried to drag her into the budget debate at -- on capitol hill. she largely steered clear of that, as did her predecessor, ben bernanke. and one piece of news that will cheer up folks in the banking community, she said she supports on the the position board of governors with someone from the banking community. taxpayers will get billions in profits from fannie mae and freddie mac, the government owned mortgage companies. they will pay the treasury more than $10 billion. the two companies are required to give the government all their profits. fannie and freddie received $187 billion in taxpayer aid. staying on the housing front, the zillow reported earnings after the close. it eat estimates and raised its full-year guidance for 2014. the founder and ceo of zillow joins me now from seattle. welcome back. >> great to be here. >> the results exceeded even your expectations. what is attracting users to mobile? what ise is definitely driving our growth. this little thing has been a godsend to our business. 178 homes are viewed every second on zillow on mobile now. we went public three years ago and it was 21 homes per second. there is massive mobile growth. and the reason why is that real estate is the ultimate mobile experience. when you are driving around looking for homes in the neighborhood, that is when you want to have the power of zillow in your hand. that is what is propelling our audience, and then in turn, advertisers follow audience. that is why revenue and profits have followed. >> your premier agent sales saw a big increase as well, mainly due to agents buying more advertising. how does that translate to monthly revenue per subscriber? bighis quarter was a quarter in terms of new subscriber ads. we now have about 53,000 real estate agents that advertise on zillow. also, our revenue per real estate advertiser grew to a record as well. and the reason is that more and more advertisers are buying more inventory from us. 60% of our bookings this quarter were existing advertising -- advertisers choosing to buy more inventory. and the reason is the cause it is working. it is working for them, and they on theirng a great roi investment. >> i'm speaking with the cofounder and cto of zillow. spencer, talk to me about the forecast and how it is changing the way homes are valued. >> this is an exciting feature that we've just launched. we have known -- been known as estimates,y with z which shows how much each house is worth. you can go and see what we say it will be worth in 12 months. and for a homeowner looking to list their home, this is important information. for a homebuyer considering buying, this is very important information. the good news is that 96% of people at their own home will find that their forecast is estimated to increase the next 12 months. it is mostly good news to comedic eight. it is an exciting feature we've just rolled out. >> -- it is mostly good news to communicate. it is an exciting feature we've rolled out. he said in his words that only homes are overrated. he added that young people are settled with more debt and less likely to enter the housing market. what is your reaction to those comments? >> housing is cooling somewhat. year-over-year, sales are about six percent and we project an increase year-over-year of about three percent. the rate of increase is slowing, but i would reject the peopleent that the way value perceived real estate or that we have shifted to a renters society, our data does not prove that out. colleague wrote a fascinating story on bloomberg.com. it says that the so-called trophy home market is shattering price records this year and that an increasing number of residential properties change hands for more than $100 million. what does that tell you about the luxury home market? and what does it say about the amount of money that is still on the sidelines? home market is on fire, particularly in the new york area. it is being fueled by financial buyers, people from the financial community. but increasingly, by foreign buyers, russia, middle eastern buyers. it -- ofhas plenty of challenges to our economy, but it is still a stable place for foreign assets. that has generated a lot of foreign buyer interest in owning u.s. real estate. that is what you see with the super high-end, the $150 million part of the housing market. ceohe cofounder and cto -- of zillow. thank you. ofing up, more excerpts betty liu's exclusive interview with sheldon adelson. ♪ >> this reminder, there are multiple ways to watch bloomberg tv. we are on the web on bloomberg.com, on your mobile device, apple tv, and amazon fire tv. allisonagnate sheldon -- sheldon abelson is one of the architects of sin city's famous strip. in this excerpt of betty liu's exclusive interview among mr. abelson talks about being such an outspoken man. you ask me a question and i try to be honest. maybe i flunked diplomacy 101. i could never be a liar. i can only tell the truth. i could be -- would be a very bad liar. >> mr. adelson also says he knows it takes more than gambling to draw his customers to his hotel. >> i look at las vegas, and my first time here and i see that -- >> it's the capital of adult entertainment. >> that is right. there are shows, restaurants, all forms of entertainment. there's a big ferris wheel i see dotting the skyline. >> by the way, i don't think the ferris wheel is going to do very much. there are ferris wheels all over the world. >> have you been on that? >> no. >> do you ever plan on it? >> no. we have a ferris wheel, the singapore flyer, right next our property in singapore. it's for the kids. to go was a kid, i love on the ferris wheel. i'm still a kid, but a little bit older. >> what i'm driving at, though, is that there is this need among casino operators to try to diversify, to try to get people into their resorts. outside of gambling. >> i did it. >> but why would you do it? >> because i'm competitive. to be competitive is to do things differently. >> stay with bloomberg television throughout the day for more highlights of betty liu's exclusive interview with it vegas sands ceo sheldon -- sheldon adelson. we are coming up on 26 minutes past the hour. that means bloomberg television is on the market. alix steel is standing by with details. >> let's get you caught up on where markets are trading. are seeing stocks pulling back from their earlier rally. the dow jones industrial at one point actually hit an all-time record high, but now only 0.2%. driven by a reversal in tech stocks into negative territory. a couple of actions we want to highlight. the first is, discovery a 50-50 joint venture with libya media to buy all thee medias, which produces tv programming. it has a deal valued at $900 million. both companies are contributing $150 million and will continue to operate under its current name and executive team. tesla also watching today, because shares of the electric car are tumbling after first-quarter deliveries trailed estimates. tesla has delivered nearly 6500 cars, but a constraint on battery supplies actually prevented it from shipping more. we are watching the markets rolling over, and the s&p up by almost one point. we are back on the market in 30 minutes. ♪ >> welcome back to the second half-hour of "bottom line" on bloomberg television. i'm mark crumpton. thanks for joining us. alex steele joined me again with some breaking news on time warner. >> time warner is actually spinning off time incorporated on may the -- may 23. it will be listed under the eie.r time what does this leave time warner with? media division, cable tv, network, movie division -- and of course, your member the lego movie came out and helped to boost was quarter earnings for time warner. shareholders will get shares of the new company as of may 23. >> we will continue to follow this story throughout the day here on bloomberg television. let's check some of the top stories we are following for you at this hour. the number of americans seeking unemployment benefits fell by 26,000 last week to 319,000. its latest sign that the job market is slowly improvement in -- improving. it looks like mostly temporary lay offs around the east are holiday. allocations are a proxy for laos, so the klein suggests companies are cutting fewer jobs. the abduction of 276 schoolgirls from their dormitories by the islamist militant group boko garneringbeen attention. protests were held across nigeria. and here at home, first lady michelle obama joined a viral media campaign under the #bringbackourgirls. syrian state television said an explosion struck a hotel in the an edgent owned area of of the contested neighborhood in the old part of aleppo. there were injuries. the biggest rebel alliance claimed responsibility for that attack. top is a look at the stories this hour. let's turn back to the crisis in ukraine and sanctions against russia. haltdent obama plans to russia's eligibility for trade benefits under a program that assists developing nations. gary hoffpauir is a senior fellow at the peterson institute for international economics and a sanctions specialist. he joins me from washington. mr. hofbauer, welcome to "bottom line" and thank you for your time. >> thanks. >> when do sanctions work and when don't they work? >> this is the case i would categorize as a military venture. we have looked at some major cases in the last 100 years involving military ventures where a big target country was -- the attempt was to deter a big target country. there are very few successes in this category. to --bout the u.s. trying one was the u.s. trying to deter britain and france from bidding did in 1966, and that succeed. there are a few other cases of note that are successful. i suppose the big reason is that when a country embarks on a military venture, as president putin has come a presumably he has calculated that sanctions will be imposed and he has taken that into account. putintainly, president and his inner circle would have to know that one weapon to be used would be economic sanctions. putin notent concerned about the impact sanctions could have on the russian economy? themthink he anticipated at a certain level and i don't think the level of sanctions imposed so far has been above his threshold. i doubt that he wants to trigger very heavy sanctions, such as have been imposed on iran. he may go slow in his effort to ,ibble away at eastern ukraine but i doubt he has given up the effort at this stage. >> talk to us about his power base. inner circle his allow this to continue? glug he has two power bases. one it -- >> he has two power bases. one is the kgb. those people are dedicated loyalists. they will not be deterred one way or another. the other power base are the -- it is, and the about 20 to 30 people who have a lot of wealth of their own and they hold a lot of putin's well. they could be concerned. but so far the russian stock market has only dropped by 15% and it has been up the last two days, yesterday and today. this is not a crushing blow to these oligarchs, not yet. but they would be concerned about sanctions that could cost them another 50% of their wealth. >> i'm speaking with gary hofbauer, senior fellow at the peterson institute for international economics. ordinary russian citizens, are they caught in the middle? will sanctions cripple their economy to the point where they will suffer? >> sure. they don't have any power, but they will suffer, and that is often the case with economic sanctions. the imf has reduced its forecast of growth for the russian 3.5% to fourabout percent at the end of last year -- -0.5% now. that is not great for the russian people. the economy there has been hurting for the past couple of years and this is more of the same. but i don't think their voice is very strong. >> we have about one minute left. the west, as you know, has interest in russia. is it possible that sanctions could backfire? how much of a reciprocal action by russia could hurt the west? >> russia stands to lose a much more than the west. russia does not have a big economy. it is fragile. wills to what you say, who suffer from the backlash, there is a lot that prudent can do to -- that putin can do to hurt the western particular europe. it has about $200 billion of commerce with russia annually, and about $250 billion of investment in russia and all of that is at risk, and the western europeans know it. that is why they are not to -- to enthusiastic about stiff sanctions. senior fellower, at the peterson institute. thank you so much for your expertise. obama's come, president nominee for health and human services secretary faces a senate committee. how will sylvia mathews burwell do in her first. -- first appearance on the hill? that is next. ♪ >> this just in, the federal election commission has allowed -- voted to allow a political action committee to make decisions about bitcoin. there were lingering disputes and a long-running debate over how to deal with bitcoin transactions under federal campaign law. both republican and democratic commissioners were debating whether they should be subject to the $100 limit in place for cash comp pain country since. human services secretary kathleen sebelius on her way out, the nominee to take over the job sylvia mathews burwell -- sylvia mathews burwell testified for the first time. what did she have to say about the future of obamacare? >> this is still a very incendiary topic here in washington. she tried to walk a line. she defended the law in her testimony and said it would be her job if she is chosen to implement that law, but she also said she will be trying to engage both parties if she gets the job. even still, republicans on the committee, including lamar and scott, use this hearing to voice this -- their grievances. nozick tries is there. we also heard from democratic senator kay hagan -- no surprises there. we also heard from and it genetic -- democratic senator kay hagan. she is under fire. here is what she said about the rollout. >> there are a number of things in thinking about i.t. procurement as well as delivery. one is, you don't connect the business owner and the i.t.. that connection does not generally occur and it is a problem i have experience in the private sector. -- have not experience in the private sector. >> not a lot of complaints about burwell herself. she was commanded for the work she's done in the past with the bill and linda gates foundation and the walmart foundation. several lawmakers knew her well as the former deputy chief of staff under clinton, or in her capacity as the white house budget director. by the way, she was confirmed unanimously for that position. it's likely she will have an easy time here. it is important to point out it is actually the finance committee that will vote on her nomination, so not the committee that held the hearing today. that is yet to come. >> megan hughes in washington, thank you. it is time now for today's latin america report. security rces raided camps in caracas today. the camps were installed more than a month ago to protest rising crime, shortages, and inflation under the government of the current president. that is your latin american report for this thursday. coming up, the 2014 nfl draft gets underway tonight. here in new york, joe flacco's agent joe linda joins us next. ♪ >> be sure to check out the latest edition of bloomberg businessweek. it hits newsstands and your tablet today. you can read it on the go with our new businessweek app. and the nfl draft when he 14 kicks off tonight. here to walk us through it is joe linta, who represents 40 nfl players. he negotiated joe flacco's $120 million contract. line" and "bottom good to see you. what has your phone and like today? has your phone been glued to your hand? >> pretty much. lots of phone calls not so much for those guys that are in second or later rounds, but the media guys. it is exciting, because you are impacting these kids lives. i'm privileged to work with them. >> you mentioned those low rounds where sometimes you find a gem, like a tom brady, some folks who get overlooked. you and i were talking before about pittsburgh, and i went to school there, and the late mr. nunn was the scout for the steelers. he looked at historically black colleges and a lot of great players, namely john stallworth .or one why did the smaller schools not get the recognition that the bigger schools are getting? >> it's hard to look under every rock. we have a good network of people, but still it's harder to find the kids and smaller schools to work with. it is a lot of luck on our end. >> in this year's draft, at least two big ones. the heisman trophy winner and linebacker from south carolina. talk to me about the economics of the draft for these two young men. what is at stake financially in terms of a signing bonus, salary, and endorsements? >> the endorsements are huge, especially if you are a quarterback. touchdowns are much more rather than if you are just sacking the quarterback. >> why is that? >> you get more tv time, and the marketers like that more. the draft now is a very cookie-cutter approach. the first pick in the draft is getting x, and pick number two is getting x minus a certain percent. >> talk about how the salary drops precipitously if the name goes lower in the draft. if your projected to be three or end or you -- but you up at about 15 or 16, we are talking millions of dollars. >> yes, but you really have no control over the process. the kids can't get caught up in reading the newspapers and looking at the pundits, what have you. >> how do you calm them down? say, 20 theou greatest days of their lives, but it's got to be unbelievably stressful for them and their families. >> i liken it to labor. you know you are going to have a baby, but you don't know when. >> [laughter] fromepresent a quarterback lsu. he is coming off a torn acl and there was somewhere that he failed a drug test, this week that came to light. what can you say about this controversy? fast came back amazingly from surgery. with regard to the test, it was a positive drug test. it was called a dilute sample, which means his sample was diluted with water from being hydrated. we provided the league documentation of that from the doctors. of course, you don't hear that in the media. >> his doctor said, you need to hydrate. >> yes, he was drinking a allen and half of water for the two weeks leading up -- a gallon and a half of water for two weeks leading up to that. >> you negotiated the huge contract for joe flacco, as we mentioned. he was the 18th overall pick in the two thousand eight draft. he admits that he always felt slighted and has had a bit of a chip on his shoulder, which you can see him standing there .olding the lombardi trophy he proved all of the naysayers wrong. is the negotiation even more complicated than it seems? >> actually, not, because in his case we attempted to do something before and we couldn't come to an agreement were both satisfied or happy. we decided to table it throughout the season. once you win the super bowl and and yourtouchdown contract is up, you have a bit of leverage. whategotiation was simple, is the highest contract ever and let's move on from there. secondsly have a few left. who do you think will go tonight? >> i think the texans will go. -- the texans logo. he is a great player and a game changer. if they go with jj being clowning, that is fine, too. >> what happens to manziel? >> i don't want to get into it. there won't be one, don't think. >> mr. linta, thanks for your time. stay with us. another check of the market is on the other side of the break. "bottom line" continues in just a moment. ♪ >> be sure to tune in to bloomberg tv this friday night at 9:30 p.m. new york time. we will take a look at the next space race through an in-depth journey into the booming business of space exploration only on bloomberg. get the headlines at the top of the hour on bloomberg radio, streaming on your tablet, and at bloomberg.com. that does it for "bottom line" and i'm mark crumpton. we will see you tomorrow. ♪ >> it is 56 past the hour and we want to get you caught up on the markets. i'm alix steel. time warner is splitting off tiny inc. -- time inc. moreholders will get shares. the new company will be listed as duty -- under the new york stock exchange ticker pie time. they're also looking at more job cuts and real estate consolidation. and a quick look on the broader markets. the nasdaq has picked up by 0.3%. the dow jones industrial average slipping from a record high it hit earlier in the day. we also want to take a look at the home builders. it is the sector most impacted by janet yellen's testimony on capitol hill over the last two days. there is a potential problem for the economy, saying "the reason flattening could prove more protracted than expected." how concerned should we be about the housing market? joining me now is bloomberg analyst drew reading. is do we know if a slowdown a blip or an actual contraction? >> at don't think we have learned anything new from janet yellen's testimony. what she did was vocalized the trends we have seen in the markets in the last couple of months. things have definitely slowed down and there are challenges in the market for homebuyers. affectingity is some people. there are still strict standards. and we will need to see continued job growth. >> what will be the catalyst to help the housing market recover? we have seen a household formation rate to continue to fall off here. does that correlate with jobs? >> what we need to see is a return to the first-time homebuyer. historically, this buyer accounts for 40% to 50% of home sales and in the past couple of years it has only been 25% of 30%. in a typical housing recovery, it starts at the entry-level buyer and works its way through the ecosystem. we are kind of at a standstill until we get that first homebuyer in and get things going. >> where is that going to come from? will it be government driven or the fed playing well -- playing around with rates? or is it just that jobs will get you want tone thing look at, particularly with first-time homebuyer growth is job growth. be a forward, that will catalyst. if you talk to some of the employers, that will drive things along at a quicker pace. >> in terms of slowing homeownership and slower demand, is there any way to play this? >> typically, homebuilders are a kind of rising tide lifts all boats. but going forward, you will have to look at any specific initiatives and what builders hatch -- have access to geographic tailwind. those homebuilders exposed to the markets in texas and northern california are doing better than the rest of the country. >> thank you. we are on the markets in 30 minutes. "street smart" is next. ♪

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