Right e hyndeo is and it might pass north of right monday or behind, and it might pass north of hawaii monday or tuesday. I authorize two operations in toq targeted air strikes protect american personnel, and a humanitarian effort to help save thousands of iraqi civilians were trapped on a mountain without food and water, and facing almost certain death. This is anmistake, escalation of the u. S. Role in iraq. Houseerg white correspondent Phil Mattingly joins me now from the white house. What was the single Tipping Point that led to the . Residents decision u. S. Officials i have spoken to are genuinely surprised at the sophistication and efficiency of the latest Islamic State attack. They felt like they had to react, and you also heard from the president , there is a humanitarian crisis. Tens of thousands of people are spot. Ad it is something the president address last night. Take a listen. Let me be clear about why we must act and act now. When we face a situation like we do on that mountain, with innocent people taking the prospect of violence on dash facing the prospect of violence at a terrific scale facing the prospect of violence on a scale, i believe the art states cannot turn a blind eye. The humanitarian side and the strategic impact of a potential nearby are. S. Forces reasons the president decided there was no reason not to act. The u. S. Has already completed its first humanitarian air drop. Are we likely to see more of that aid . It looks like it. In a conference call, senior Officials Say what was dropped yesterday was the equivalent of enough food and water for 8000 people. We have seen estimates that there are tens of thousands on this mountain nor in this region, and the u. S. Officials made it clear that there is a real possibility future humanitarian airdrops will occur in the future. They did not give a timeline, but 8000 is not enough to feed tens of thousands of people. It is safe to expect further airdrops will occur. The limit here to his operation. Within a rock it was q. Thin your act within ira there were questions about whether this includes syria, and the answer was no, but it goes throughout entire operations in iraq. If there is a threat to baghdad, where strategic assets, there is a possibility the u. S. Will use. Irstrikes there, too it will be with incorrect, but there will be further escalation. Markets are red around the world. We seem to be seeing a bit of a comeback taken early in europe. For todays session, it has been volatile. You saw stocks getting crushed early in the morning. Was getting hammered. Lastat the dax over the two months. In june, there was a lot of happy talk about the ec peep. Since then, we are down almost 10 . Yieldss, german bond went lower. Were looking at record lows for german bond yields. The movie and oil is the move i find interesting. Is the move i oil find most interesting. Most of the tension is in the north of iraq. Is this a fundamental concern, or a kneejerk reaction . We have to differentiate what is happening in iraq, and what is happening in russia. One is a sentiment issue, and another is fundamental. The russian issue is not just noise, it is news, and that is driving markets. Lets talk about the russian issues and the impact of sanctions announced by russia yesterday. Are they starting to hurt european businesses . It is starting to show up in some earnings numbers. Talking about food imports, it sounds like comedy, but we are talking about 10 of eu exports going into russia, and that is a big deal. That we are talking about escalation risks, and we are talking about the possibility of russia actually banning flights through the territory. Lufthansa, air france over 200 weekly fights flights from both of those airlines that traverse to the region of siberia. If that flight path is closed, that means a longer flight route and more time equals more money, and that will have a Serious Business impact. The numbers are speaking to the tension in russia and if the erect situation is just a sentiment issue, listen to me, russia, there is something much more fundamental. , thank you. Ferro with a death toll of at least 900 42, the world health this aation has called public concern. That mean . What does it means there needs to be an international response, but what that could and should look like we do not know. The who says the threat is particularly serious and only a coordinating coordinated response can stop and reverse this. It was at a press conference in geneva that the director general sounded the alarm. Alerts thearation world to the need for high possible cases of ebola virus disease, but by no means implies that all countries or even many countries will see ebola cases. The expectation now is that more International Funding will come rushing in. The world bank pledged as much as 200 million. What they will do with that money is still to be determined. No approved vaccine or treatment for ebola, as you know, which makes this all the more difficult. Without one, the who outlined a long list of recommendations for toected countries on how contain it for all other states, including the united states, suggesting that Health Officials should provide travelers, the general public with relative information on risks, measures to minimize the risk, that they be prepared to manage ebola cases as needed, and that they be prepared to facilitate the evacuation of travelers and employees of companies. They stopped short of recommending a general trade or travel ban, some encouraging news. Less encouraging, the who warns the outlook is likely to get worse before it gets better. Heres the thing the outbreak happen in march. What has taken the who so long . O declare this it is a huge criticism. A question many are asking. Many say they shouldve taken a position months ago. Getting to this point was not easy. Were atl sensitivities play. The who has always viewed itself as a Technical Advisor on Health Issues to governments, and meaning they need to respect the sovereignty of the african nations. Yang, thank yang you so much. Yang yang in washington. Moving and shaking this hour, Warren Buffetts favorite banker. For at least a dozen years, starting when he was at goldman a closerott has been advisor to Warren Buffett. He has been involved in deals involving 10 of the 30 wealthiest people in the world, and among the some other midwesterners like charles and david coke. He also works with the heirs of the family of walmart. He asks for a 25 Million Investment for one of his equity funds. We will have much more on byron next hour. E some of these reporting earnings. Dan loeb is now the largest shareholder in the auction house. Olivia sterns has been looking at the challenges ahead for sothebys. They have made big changes. A little bitook like this morning, which is surprising because there have been record sales this spring. It looks like everyone was putting out tens of millions on our. Art. Has the cellsally growth, but they do not have the earnings growth, and that was part of daniel loebs critique. Spent too much time whining and dining clients when they should be focusing on trimming the fat and making things cost efficient. Saying thatps he is whining and dining is getting people to buy the items. The margins are shrinking. Why is that . Even though people have more money than ever to spend on art, the 1 is growing, but there are 300 peopleion in the world to buy or sell a jeff koons. Clients,t over these and have to offer huge commissions. That is why margins are shrinking and that is why they are focusing so hard on trying to get new clients. They are scouring the globe looking for wealthy new clients. Christies flew in dozens of wealthy chinese pet that is why they are focusing on linux and chinese. That is why they are focusing on is teaming upbys with ebay. Thank you, Olivia Sterns. Farmers under fire they just want to farm their land free and clear. The largest homebuilder in new jersey, my home state, if you know by now, if you watch the show, and the six largest in the u. S. Announced they are expanding into the charleston, South Carolina market, after unexpected drop in new home sales in the south and the north east. Chairman and ceo ara hovnanian joins us now. Good to see you. Glad to be back. You have expanded into charleston. We saw these numbers about the southern markets. Blip . At a lip it is easy to get concerned about what numbers, but in any week or month, but we fought this but we focus on longterm, graphics. Demographics. Deaths plus immigration it is predictable. That outlook, almost all demographers are in the same range. 1. 6hould be producing about million and 1. 8 million homes per year. We are nowhere near that level, so we are underproducing and that means we have to catch. It is not so simple like that. Math, we woulde all be geniuses. Longterm demand is simple, go,where they are going to and yearbyyear, that is affected by interest rate, what is going on in the economy student loan debt. Absolutely, vladimir putin, direct, that affects daytoday, but longterm shortterm, what will the rocky . I will tell you what is not rocky at all, the Silicon Valley area. It is incredibly strong thanks to job growth. Texas because of the energy corridor. Does that mean you are putting your money there . Our largest market is houston, texas, and texas overall, which includes dallas for us, is a very large market. Big issueout this weighing over the Housing Market, which is firsttime homebuyers . How do you get firsttime homebuyers and quality firsttime home buyers back into the market . That is the key because the subprime crisis really caused an overreaction, which is understandable. We were too lenient as a country and giving loans and now the pendulum has swung the other way. We are overly restrictive. Eventually, things have to go back to normal. You never want to get back to the subprime days, but you want to get back to normal, underwriting qualification standards that worked for decades. How far away are we from normal . We are a ways away still. Getting a little better every quarter is getting a little bit that are, but we are far from normal. What we do get back to normal, the first time home buyer can enter in full force and that will give an extra kick to the Housing Market. I am hearing anecdotal evidence right now in this country it has become cheaper to buy than it is to rent. Was 38 trulia said it soaper to buy than to rent, there are pockets where firsttime buyers are being catered to, told to by this starter home. Is that raise issues for you . Are you getting undercut the competition . We do still build firsttime home buying product. 20 of the home 28 of the homes are sold to firsttime homebuyers. Does the price range . In Silicon Valley, were selling to homebuyers and 600,000 to 800,000. Ishouston texas, it 150,000, so changes genetically dramatically. New jersey, where you are is leadingome state, the country, or at least has seen any strong gains in foreclosures. What is behind the . Behind that . There are different state rules for foreclosures. In new jersey, you connected a foreclosure very quickly. It is a long process. It goes to the courts. Beenhis eight backlog has held up and it is finally making its way through the system. That is why you are seeing the numbers spike up. Does that mean we are not as . Ad as new jersey as florida florida was also late, but not as late as new jersey. Cleararkets like arizona very quickly. New jersey has been slowing the recovery, but that could be a good thing longterm. Stay with me. I want to talk more about the Housing Market and get onto the california market. We are staying on hot property in california. Prices are soaring in a beach town that cut attract everyone from holiday nba stars to money managers. And, a bigger gap between the haves and the havenots. First. Bloomberg. You are watching in the loop , live on Bloomberg Television and streaming on your phone and bloomberg. Com. Good morning. I am betty liu. Resident obama has authorized limited airstrikes against sunni muslim militants in iraq to protect u. S. Personnel and minorities stranded on a mountain. It threeday truce between israel and gaza is over. Rockets were fired from gaza into southern israel is Morning Hours before the 72our ceasefire expired. Israel retaliated. Palestinian militants have said they will not end the fighting unless israel agrees to end the gaza blockade. Malaysia airlines is going private a state Investment Firm is buying 31 of the airline that it does not already 449 million. The firm plans a complete overhaul of the airline that was hit i two major disasters this year i two major disasters this year. It is 26 minutes past the hour. Bloomberg tv is on the markets. Backy futures have climbed from earlier losses this morning. Investors rattled by jill at political by geopolitical concerns around the world, everywhere from concerns in iraq, what is going on in russia, and concerns about growth in russia. We are on the markets again in 30 minutes. Ofk here in the u. S. , is one the hottest Real Estate Markets in california, where a small patch of property can spell sell for as much as a Beverly Hills estate. Is changing from a community of beach bums and bungalows to a destination for big money. We went to find out why pro athletes, hedge fund managers, and hollywood celebrities are drawn to this foursquaremile city and they are willing to wait months, even years, to find a place in the sun. When someone wants to come into men and gates, i tell the many to be patient come into manhattan gates, i tell them to be patient. The Real Estate Market is on fire, but there is no inventory. I have been a developer in Manhattan Beach for 19 years. In the past, in the hottest markets ive ever seen, you have roughly 240 homes available. Currently, we are running at roughly 40 homes on the market. We are very scarce. They are the properties that just came on the market last week. It is only 1300 squarefoot lot. It has 34 offers. Sixhattan beach has four to areas. Along the beach is an area called the strand, the oceanfront properties, and those are through the roof in terms of values. Here,is property right this just sold for 16 million, equating to about 4000 per square foot for land value alone. This property is obviously a tear down. We have some of the biggest facebooknd managers, ex people. Vince vaughn waterhouse. Well. Kimmel as a house as virtually the entire Los Angeles Kings hockey team. They prefer to live here because of the lifestyle versus Beverly Hills, where it is very flashy and fancy. Here in town it is more about family. It just has a real sense of community. It is like a micro economy itself, completely different and unaffected by the other areas of the country. I do not believe this is a bubble at all. I do not see it ending anytime soon. Blocks well, it looks beautiful to live there. Well, it looks beautiful to live there. Still with me, our property player, ara hovnanian, the chairman of one of the largest homebuilders in the u. S. You do not develop in Manhattan Beach but you have properties along the california coast. We do. Everybody always says i do not think there is a bubble and the Property Market until the bubble bursts. Lets have a reality check is there a bubble in some of these markets . Beach property along california were here in new york theres only so much fifth avenue overlooking central park poverty. It is the same property. It is the same thing in california overlooking the beach. What is the value as long as there is demand. Yes, and there is wealth creation, and there are only so Many Properties and it adds value. You develop everywhere from average price homes to the very highend. Are you seeing any kind of flipping in the highend markets . No, it has really not gotten to be a speculative market, at build. N what we see and we are selling to users, people that are not buying it as an investment or expect growth of speculative play, but people that are buying it to live in the house. When the speculation, in . Crisiscally later in the. That is when we hear there is a bubble. When your taxidriver is investing in three properties, it is time to be nervous. [laughter] in Silicon Valley we have heard so much about how property prices have gone up in that area and that has created strife among residents that cannot afford those kinds of homes. As a business person, i imagine you say prices continued to rise, there is demand, we are going to go there. I believe in the free market system 99 of the time, and it is the free market system at play here. There is a lot of growth in Silicon Valley. There is a lot of employment in the area, and that is driving up him and for housing near that driving up demand for housing near that. What happens if prices go up too high, theyre taking jobs and going out to san francisco, for example, instead of just san jose, and that is spreading demand, and some nonessential roles that do not have to be in Silicon Valley are moving out a little bit and that is typical and helpful to overall development. Is there any difference about selling to Silicon Valley owners, these newlyminted tech millionaires that might be worth a lot on paper, but they do not always have a lot of cash on hand. Is there Something Different going on in that market . They have surprisingly good publication standards overall. Qualification standards overall. There is a lot of wealth, a lot of income. As has been a solid market compared to other parts of the country. Houston, texas, and Silicon Valley are solid markets in terms of qualifying buyers. Where will you develop . What are you jittery about . I am a homebuilder, so