Paribas, and considering slavering slapping charges. Plus, professional boxer, Floyd Mayweather junior, currently undefeated World Champion repairing for a fight this weekend. Also throwing his hat in the ring with Oprah Winfrey to compete to buy the l. A. Clippers. Do we want to buy the clippers . Yes, we do. There he interested in buying the clippers. We will keep them right where they are at. We will have all of that ahead. Getting to the market right here. Gocks were watching as we into the close. Julie hyman keeping an eye on them. Avon shares declining sharply. Million. Will pay 130 5 million for a justice criminal Department Investigation and noncriminal investigation, similar investigation. The company reporting a wider firstquarter loss as sales fell in all of the regions. We have been watching a lot of pharmaceutical deals recently. A Company CalledMerrimack Pharmaceuticals reported in a study that patients treated with the experimental cramp cancer longereated lived than those who receive standard chemotherapy. No approved drugs. If it were to get approved, that would be a big heal. Shares are surging. The other deal talking about is in telecom. At t has approached directv for talks. Hares are at a record of course there has been a lot of merger talk in the industry. This reportedly also approached directv. Our big story,to a megamerger in the Telecom Industry could be in the works. Softbank planning to move forward with a bid for tmobile. The company met with them this month to make that arrangement for the tmobile offer and could be a pretty big win or sprint. The acquisition target added more subscribers in the First Quarter than at t and verizon combined, adding 1. 3 million new monthly subscribers. Joining me to discuss, jeff mccracken, Bloomberg News managing editor and tina moby. Also, emily chang. I know you just sat down with the tmobile ceo. What did he have to say about potentially running the tmobile merger . Kudos to the team for breaking the story and also breaking the scoop john leger is a leading cavender asked canada to run up potential merger. I love interviewing john because he never minces words. Always provocative. Any other ceo might not have done the interview at all after we broke the story but he came out swinging, not just on television. Run theing candidate to combined company. I . Tweeted back at me, am . Consolidation is one path forward or this company. I will not comment on any individual talks that may or may not go on. With the approach we have and the options we have, consolidation is one good option. Our shareholders and owners would consider any opportunity. I am not privy to any of what you learned there. The individual speculation about me, you know my own opinion of myself. It will be easy for me to comment on that. He thinks pretty highly of himself. When i asked him a couple months back, what if dan has he become ceo . He said that would be like reading cory johnson in charge and noberg west one would ever do that, right . What do you think about the potential for this to go through . One of the more unusual situations in that 30 billion dollar megamergers are not usually this will telegraphed. Meetings with big regulators. He got pushed back regulators weeks ago. Or julyframe is june when you would get a deal announced. Really not trying to hide the deal from anybody. Isnt he going to change the pricing by being so public about it . His view is he wants the regulators to know he is coming, and he wants them to know here is the proposal i will make him and be prepared and be ready, and i dare you to block me. Thats quite a character. Do you think regulators would be ok with this . I think it will be a tough sell for regulators. More important theme is what this means for pay tv and wireless and skate. I think it is all about the race to offer consumer integrated bundle services. You can make the case that a combined tmobile and sprint will be a much more level competitive Playing Field with verizon and at t. Thatwould agree consolidation is the main driving theme right now. I know you spoke to him about whatands for the company, he would do differently if he was running sprint. Tell us what he said . Twitter he has bashed all of these guys. At t and verizon and even sprint. Up. Ays sprint is frucked him what sets him apart . What he would do differently if he was running sprint. Take a listen. Is nothing more than another way of touching individual customers, listening to them. The difference with me is i listen to them and then i walk in and use that as the strategic input for how i run my company. It is not mckinsey, bain but individual customers on twitter telling me what to do, creating the next phase. I would do that in any of these big companies. Wrinkly, i just do not know if the companies are ready to change. Frankly. Like even that sprint is ready for it, who knows what regulators will say. The argument has been they need for competitors, four players for there to be real competition. Tmobile says if you combine the underdogs, you have three real competitors rather than a doowop list and underdogs. Talking about another deal in the making. Rumors at t is approaching directv. What with that gain for them . We reported weeks ago that dished and directv have had merger talks. I think it is inevitable in the next 12 months you will see dish and directv. You will see a merger between one of those three. Broadly speaking telecom and Satellite Companies are coming into the same Playing Field. What will that mean for the consumer . For the consumer am i think such a merger is questionable in the sense that you have more choices that is better than less. More importantly, for investors, a very important aspect, we upgraded directv today rummel hold to abide. A buy. A hold to we believe it makes the potential margin merger to be more plausible. I would think there would be other candidates out there that audiosay being the sole provider as directv is, granted it is doing exceedingly well, we think the future is wireless broadband. Reading all of that together. All of that together. You said we will probably see more rumblings. Is this something specific to the media sector or merger and Acquisitions Development . It is really like the dam is broke. Merck looking to do deals and pfizer and astrazeneca. Confidence out there . Behalf of ceos willing to make the acquisitions. Cash has been on the Balance Sheet for a long time. Investors have been rewarding deals for a long time. Seems like at the board level theyre willing to go forward. The changing lets double size of my company type deals. A big deal. Sticking with me. Tank you for being here. Terrific interview. Thank you for sharing the highlights. Coming up next, the pepsi ceo speaks to bloomberg tv about hedging her bets when it comes to inhome soda makers in standing her ground with activist investors. We will go inside pepsi next. Plus, is chinas economy about to eclipse the u. S. . We will hear the heart of the debate that may redefine relations between washington and beijing next. Pepsico fighting a multi front battle. Dealing with nelson peltz who wants to see pepsico spinoff the struggling Beverage Business. Betty liu spoke with the pepsico chairman and ceo about dealing with activist investors, and she joins us now. Still on set with me is jeff mccracken. T does he say about how she say about bringing back the carbonated soft drinks could affect the business . Both pepsico and pepsico cocacola dealing with a deflated soft drink market. There is no secret to the trend. There is diy Home Improvement am a cars and now diy colas. That seems to be the next trend. Shes wanting to see if this markets in the market will really grow, and if it is a misuse open to looking at technologies being developed, including the one game developed by soda stream. They are the target of a lot of acquisition talks. The things she said to me on that which i will play for you in a moment, pushed the soda stream stocks up to an intraday high. Let me first play for you what she said. Inhome soft drink manufacturers could be something that is a significant force into the future. When that is going to happen, we do not know. I think our goal is to make sure when this category becomes of factor in the marketplace, we are playing with all of the machinery manufacturers. It is an open system and we can supply great tasting products for all of the people so consumers can get pepsico products whatever machine thereby. Clearly investors in soda stream are very sensitive to any kind of talk that might open the company up to acquisitions. Starbucks might be interested in taking a 10 take stake can soda stream. That hass a Company Really been under a lot of challenges. Nelson peltz wanting to spinoff the snack business, carbonated average business not doing as well. People around the globe looking into other kinds of beverages. It is she going to do here . Nelson has a pretty good track record. Heinz tot correctly on dr pepper and kraft and other Consumer Products as mrs. He has been right a lot more than he has been wrong. When it comes to Consumer Products and beverages he has made a lot of good investments. What is the advantage . He thinks they are very bloated. He thinks the headquarters is bigger than it needs to be. He thinks youre the number two Beverage Company and Snack Company that on their own will be just fine and can start to do acquisitions. He would like to see an old craft business be coupled up with the snacks business of pepsi once they are broken in to two. You do have synergies, given that pepsi is on shelves all over the world and can then put snacks on the same shelves in the same Grocery Stores and that is a bit of a synergy that benefits that it would not have if it was separated. That is right. All of the arguments nelson peltz has put forward as to why the company should be split up into two are the reasons why andrew newly says it should not. Beveragea softening markets. We need the snack food market and innovation being put in place and other segments. We need that to help offset some of the slowing growth you are seeing in other areas. Some of the stuff you are seeing about leveraging, you do not see it out front as much. More behindthescenes. She can bring both of her businesses to various distributors. Happens when you are looking at the bottling system for instance. I want to play another part of what she said. I asked her about nelson peltz and so there are for postals and what do you think about them . Anytime a shareholder gives us any sort of feedback, we take it very seriously. At the end of the day, we are all shareholders of the company, too. If anyone has an idea on how to create more value, we are the first people to take that to heart. I own 20 of my salary and pepsico stock. Jeffs point, what nelson peltz has said is it is a cash cow for the Beverage Business and should be a standalone company. He said beverages would do much better on its own and much more focused on the carbonated soft drinks market and be able to innovate more. That is his argument. Here at pepsico, they disagree. Like thank you. Thank you. Jeff mccracken, thank you. I have a feeling i will continue to see you more. Inc. You. Next up am a new report says china may change its path. The data may tell you another story. The Justice Department said to be preparing the first criminal charges against the global bank since the financial crisis. Will we see a Lehman Brothers style followup as some have predicted. That is next. Time for todays global outlook. China could surpass the u. S. Of the Worlds Largest economy this year. That is an attention grabbing headline. Comes from a new world bank study. The trouble is, Michael Mckee says it is ridiculous. Everyone talks about 2027 as the key year they take over as the Worlds Largest economy. Measure itis how you and whether it means anything. Gdp obviously is the sum of all the goods and services, the value sold in a year. Something else called purchasing power header parity. This is what it cost to live in a country given the differences for what you buy in what you pay for it for exchange rates. The world bank compared ppp to gdp. They recalculated the numbers it, sayingnd updated it could happen this year. The problem is, that is nonsense at this point. No one believes the chinese Economic Data are any good, not even the chinese leadership. A cousin that, hard to use the numbers. Were good, they do not use them for a couple of reasons. Things that come from overseas. Also, in the case of china, not fully convertible. You are guessing at what the value might be and what you buy internally may vary from what you buy in the United States and variety and quality. You are really left with gdp. By the traditional measure, chinese economy only half of hours. I the traditional measure, twice the size. Can we anticipate 2027 is still the year . You look at the growth rate in china, and whether you trusted or not, still probably better than what we are growing at. Growth rates very. It is true, they will pass this. 20 of the world population. No reason to believe they would not pass it. Only a question of when, not really if. Looking at a different measure, and that is national wealth. Not just what we produce in a year but what we have accumulated. The chinese have all of the people but not very much national wealth. You do not care really about what the countrys gdp is, you care about what youre part of it is. What are you getting out of it . By that measure, the chinese are still well behind us. Kind of like who cares if the economy is growing fast or if it eventually is bigger . If the standard of living cannot rival ours, you would still rather live in the United States. That is what the chinese are focusing on. They said we do not agree with the methodology and will not publish it in this country and do not think it is an official statistic because they are focused on trying to raise the Living Standards of the individual people. They have fast defenses. Another report of the inequality level is greater. Yes, clearly. Issues theylot of will have to deal with. The United States will remain an important economy whether we are second or first. Thank you. Coming up next, big banks in the crosshairs of federal prosecutors weigh criminal charges. Critics warning of a Lehman Brothers style fallout. Do criminal charges main more fallout . More on that story coming up. Welcome back. I am trish regan. Prosecutors setting their sights on big rings. Paribasuisse and pnb could be looking at litigation. On big banks. Joining me now to discuss whether the concerns are legitimate, richard farley, hardware at Paul Hastings and carrie geithner. Great to have you here. Is there a chance it will get willbad that prosecutors put people in jail . They may put people in jail, we do not know. I know nothing about the merits it the case other than what i read in the paper. What we are seeing, particularly as a result of the bank of america case against individuals, ken lewis and joe prosecutedworked because they cooperated with the government by acquiring Merrill Lynch and then accused of not disclosing how terrible things were to the shareholders, and these individuals were banned from Public Companies for yearandahalf and find the 7 million. Fined. If you have an environment where if i cooperate with the government and do what they tell me to do to save the Financial System and i am going to get prosecuted for what i think was a minor offense, i think that is a toxic environment that will reduce the ability for private bailouts going forward. Eliminating the ability of a change of law and public bailout. Who will be there to pick up the pieces . Also a question, do prosecutors want to push it that far . Arthur anderson. A lot of fallout. Posing ds of people losing their jobs. We do not know what will happen if they do indict one of the banks. If they do, what is the fallout from that . That is where you see a lot of controversy and debate over whether or not it should be the way forward for how prosecutors are treating the cases. We have some idea. I think we know prosecutors are working with the regulatory authorities so that any unintended consequences are avoided. There is always a wild card, which is a person who have not necessarily thought of, a regulator in north dakota who can decide to do something with a consequence no one thought of before hand. I think the regulators are pretty as possible and thoughtful in terms of what they are intending to do. Being thoughtful and very intentional when they go after foreign banks here . Are talking about a swiss bank and french bank, no american bank. That is very true. Another issue is these particular cases do not have anything to do with the financial crisis is what people were clamoring for to see a case against banks, major ceos and those angst. So this is a way forward and possibly a test case. However, it may not be the kind of case people are really clamoring for from the fallout of the financial crisis. Backing up for a moment. You have done a lot of reporting on this. Iscribed actually what transpiring. Credit suisse that has been a target for prosecutors going back to 2011 him and the concern is they are allowing people to evade taxes. We have that issue, and of course we have a Senate Hearing about this, which has probably put more pressure on prosecutors to bring action and brought more attention to this case than there was previously. Then we have issues with sanctions. Several banks have settled over similar sanction issues. Will be really interesting to see us that case unfolds what really is going on with that and the behavior they are really honing in on that would basically merit an indictment of the banks. What do you think will really transpired . Are prosecutors aware they can push but maybe not push too far . They are very aware of how far they can push. They are working handinhand with regulators. A prosecutor, isnt there some heroism for going after the quote unquote thatbad guys . Whether they are bad guys or not. The environment is if i can get a scalp of a large bank or senior executive, i will get it. I think that has been on the agenda since 2008. Have done what they to jpmorgan. Billions and billions in fines. Same thing of bank of america. Case,think if they see a i think theyre going to go for it. I think if they think they have a case and discretion involved tom and they will go ahead with the case. When they are looking through and trying to find the evidence, you do not think they are influenced by the idea that it makes sense to go after a bank . Of thing versus another corporation, i think there is currency to be made and political pressure. No one is in jail as of yet as a result of 2008. I think it is a real pressure that is on lovall levels. In 2002. Anderson back 85,000 people that were put out of work. That one mention earlier as well. A company pioneered junk bonds. To six counts of fraud back in 1989. What was the fallout here . With drexel, the charges brought to the prosecutors by the prosecutors went to the core of the franchise. If you took junk bonds and out of leveraged finance, what you had left was not anywhere near the business you had before hand. The stigma of being under indictment and the enormous fine compared to the capitalization of drexel, these things are much larger. See the fines as significant nowadays . I do not see it as much of a nexus then show it x essential threat. The fine issue is controversial. Fines come out of what is essentially shareholder value. Whether or not but as a deterrent to future bad behavior is definitely a debate. What a lot of people say about the issue is you have to go badr individuals to detour behavior. If these do go forward, and we do have indictments, there can be a lot of planning and a lot of ways to try to safeguard the fallout from that, but the whole point is, what are we missing and what can happen we do not expect . I think those are the concerns the market is feeling with the issue. Thank you very much. Next, google is pushing a new and efficient way to target advertisements for youtube. Find out what it means for the viewing experience. One of the top strategist on wall street, adam parker with your youre with me. Find out what he thinks the market will do when we come back. Media giants like hulu have dissented on new york city at a brand cast event. They unveiled a new Service Called google preferred, which packages the top i percent of the content on youtube for advertisers. In joins us from los angeles with more. Here is this work . How it is going to work. The traditional world of television and the advertising, i think the advertisers understand as a big show we want to advertise on the big show. One of the challenges from the other players out there, despite the fact that all the people consuming stuff on youtube all the time is try to send the same message. If advertisers will move money away from traditional tv and move it to youtube, they need the message to hit hard. What we have seen of the brand are event this week, they getting bigger and bolder, and what theyre talking about in this case is if you want to reach the top five percent of weff consumed on youtube, will put your advertisements in front of that and you can tailor that specifically to one area or another depending on the audience youre trying to get. Advertisers have always told us they want us to help them by advertising easier. So we created google preferred, the top five percent of channels on youtube in 14 different had a glorious. What it really does is help advertisers find the content most popular, the content shaping pop culture and growing fastest on youtube. You go. Very much trying to steal the spotlight. There is a Young Youtube star who was at the event. Tell us a little bit about her. I loved the story of bethany mota, basically she will say i will be somewhere, and literally huge lineup of people will come to find her. Five years ago i do not know if this would have been the case some up but they do it because they subscribe to her on youtube. 6 million plus subscribers. Started making the videos on her own and started talking about fashion and trend and now there are big rants that want to team up with her. Youtube is really pushing this, the fact that there are youtube stars the way there are big tv stars. We believe advertisers will always follow the viewer. Today we have more people 1834 years old then cable tv. A lot of the things we talked about tonight, with google introducingnd advertisers to the great creators in the lineup are really meant to help them buy into advertising easier. Same they still do not have the same sex appeal as compared to the broadcast networks when they say give us your advertisement money, but they are getting better. Certainly something people are talking a lot about. Ex very interesting stuff coming up next, introducing you to the ford ceo. What investors need to know about mark field coming up next. It is official, Ford Motor Company have announced what analysts have been anticipating for quite some time. The ceo will pass the baton to mike field mark fields. Matt miller caught up with him and now joins us. Basically, this was telegraphed, shall we say, pretty well. A long time. Someone was at a dinner event pretty recently where mark fields was speaking and the announcer said lees welcome the next ceo of ford. I do not know who it was. Apparently there was a chuckle around the room and not really denied. Everyone has known he would be ceo for a long time. The question was the timing. Hadame down to alan mulally been in talks with microsoft and everyone knew it. Mark fields had been running the company for so long. Since november 2012 he has been running the daily meetings in day to day operations. They were grooming him for it. The company was well enough positioned to make the change. The question was whether or not they were really sure it was him . I asked will forte if they thought about hiring anyone else. Around the world. We looked at executives inside the industry and outside the industry. We kept coming back to the fact that we thought was the best candidate. That is why i feel really good about the transition. Our due really did diligence. The more we date, the better we felt about mark. Like he makes the point they did look around. His family is the controlling shareholder. He also told me in the first meeting with alan they talked about mark as a potential successor. That was eight years ago. Eight years ago at bills house come overbor alan had to discuss the possibility of working for the ford family and the Ford Motor Company. They apparently talked about mark then. A rising star. Then at the company for 25 years. 28 years old, straight to detroit and ford. He has been in asia running mazda. Running the big luxury brand when he had all of them and then an amazing turnaround. They brought him to the u. S. Women have record bosses. He turned it around. How is he going to take the company to the next level . , whatne has been asking will he do that is different . Aat you are seeing now is product of mark and allen together. The one fordim do plan. He has been leading the thursday meetings. On hiss really taken philosophy and Business Leadership style. Is there some hesitation out there about mark without alan still going to be the ford company . I asked bill and he said he probably will not help people as much as alan does. Alan is a hugger. A very affectionate man and i respect that about him. , and i feelhug honored. He loves the ford flex for example. Ark loves the taurus sho, high output model. There is a slight difference in personalities and maybe we will see that come through a little bit. Finally. T is official work fields taking over. Thank you. From fast food to fast cars, the top 10 stocks you need to know about. Moments away from earnings out of linkedin. The closes next. I will see you back here in two. I am trish regan. We have the close coming up. Heading into it with three minutes 45 seconds to go. Number 10, like medicine legg mason after posting revenue thatr missed analyst estimates. Astinuing to struggle investors turn away from fixed income. Number nine mastercard. Thatd firstquarter profit beat analyst estimates. This as Consumer Spending rose and the labor market saw improvements. The ceo did note he expects u. S. Tensions with russia to have a small impact on this years earnings. Number eight, yelp pouring almost nine percent. Soaring almost nine percent. Fourthquarter revenue beat predictions of 75 million. Sided tony outperform. Brandsber seven, yum down slightly. The Company Announced greg creed will be appointed the new ceo am effective january 2015. He will replace david novak. The man responsible for bringing the doritos locos taco. I preferred the doubledecker myself. The soft taco with the heart taco. 88 beef. Number two, pfizer. Set to be sweetening the deal for astrazeneca. The offer will come through next week. More on the story later in the roundup. Down. Mber five, avon they have agreed to pay 135 Million Dollars to resolve u. S. Probe on whether or not it paid bribes in china and other countries. The fiveyearold investigation has cost avon almost 400 million. That is a lot of money. A lot of mascara. A lot of lip gloss. A door to door . Today comes around . It is really big in emerging markets. When he said he emerging markets, i thought you meant misery and alabama missouri. In ohio, i grew up with the avon lady coming around. I remember that sort of thing. Number four, Abercrombie Fitch up three percent. They have named four new independent directors to the board after numerous by activist to change of management. Twouncing plans to hire president s. Wears adam johnson always it. Shirtsllister t on the weekend. Number four, number three thomas ford. Shares in the red. Sales fell. They have announced officially finally that mark fields is the next ceo. Toyota posted a sales beat, citing them in some number two is tmobile. They added one point in the First Quarter. More than at t and verizon combined. They may be planning to make a purchase. Lets move on for number one stock as the closing bell rings. It is directv. They are considering a bid to acquire directv. The talks follow comcasts agreement to purchase Time Warner Cable for 35 million. Yesterday was a new record high for the dow. You are looking at a dow that was unable to hold on. It is higher for the Third Straight day. It was led by internet stocks. Cristina alesci has more. Been i haveas been paying attention to the nasdaq a lot. That will determine the fate of the stocks that are planning to go public. We have seen so much volatility. We were looking at how offerings were pulled. The market is an important indicator for a lot of angst. It had been on fire. Were talking about this today. It is very unusual when the buyers and the sellers increase. That is what we have been seeing. Everything through the prism of them and a. Theres a lot of activity happening. You will be busy. I want to bring in the managing director at morgan stanley. We are looking at a market, new alltime high on the dow, three Straight Days of gains, and we have seen a little bit of recovery after a recent selloff. What is your prediction . I am bullish. I continue to be bullish. The economy will slowly improve. Will continueet to make new highs. 5 . 10 . In 2014. Rget was set you and i can remember that. 8 . Is between 7 and remembering the anemic growth that we saw the economy has to do better. A lot of people say that a Strong Economy is the biggest barricade. They think that the fed will not be able to convince people to act earlier. That is ridiculous. The biggest barricade as when u. S. Equity becomes weak. We are forecasting some improvement in the economy of stop that translates to better growth. E using 8 go ahead. I was talking earlier with christina about this. She expected to see a new high everyday. Ou wonder how much she expects to see another new high everyday . Another new high, another new high. Those expectations are not necessarily good. That could portend danger. That has been my concern. I am probably spouting the opposite. I worry that the economy has not caught up to the market. You do not want a lot of capitals ending. That creates volatility risk. You want a slowly approving economy. Then you are fine. Slow and steady. He do not need a fix was of recovery. We have a nice excuse with the weather being bad. You buy that excuse . For some companies more than others. Loan growth will improve slowly. That will help the economy. I think growth will slowly improve. That is not a bad actor on. It is not a heroic place. Sit tight for a second. I want to talk to you about specific factors. We are breaking them down. Xp a looks like it beat expectations. It is up 24 . Areedin looks like they beating estimates as well. That is unbelievable for linkedin. We have seen the stock take off and stand out. You have to remember that in with is bundled different media stocks. Dirty eight cents versus estimates of . 34. They are coming in there for linkedin. We are watching the stock. This is top by the way. There has been quite a ride. You talk about some of the momentum players will not this has been one. They have seen a recent selloff. People are watching carefully. We have revenue you can see why the stock is moving down. After hours. Do we have the sale numbers . We may be looking at the revenue numbers and eating that they are not what do you think of some of these Tech Companies . We have seen a pretty wide selloff in names like lincoln linkedin, recently. Youur work shows that when seek value, that typically lasts. We went back and we study and we saw this reversal, what happens. I average, growth is up. It outperforms by about 8 . There is more to go in this reversal. Energy is important. Longterm, you probably still want an investment in software. Right, companies are not spending a lot of capital. They will probably invest in productivity. I like software. Million versus 67 million. Revenue is coming in better. There this may be tied to people feeling like the news is out and they will take money off the table. Companies can react to profitability and there are number of issues at hand. More broadly, if you are managing money, you have to look at the growing industries. The fastestgrowing industries are biotech, internet, and software. You do not want to have no exposure. Everybody knows that and they are trying to time it out. As an investor, you Want Companies with three attributes. They are gaining shares. You have to figure out which ones fit the bill. It looks like linkedin is lowering its revenue forecast. 2. 06 forecasting between and 2. 08 . It is not that big of a deal. Getting intots Little Things like this . Im trying to make the generic point that this is part of what matters. You cannot just look at revenue and earning numbers. You have to consider profitability. What i have noticed more broadly is that the penalty for missing on guidance has been harsher than the reward. It is a guilty until proven innocent mentality. Investors are taking these companies to task for specific numbers like we have seen of twitter. How fast their user growth is. It is interesting that they are taking them to task for guidance for the performance. These companies are obviously trying to under promise and over her form. Apple always has guidance lower than it will hit. I am not trying to beat you. But Tech Companies in general do that. It is every company. This earnings season, we have seen on upside in revenue. It is a lower bar. You clearly lower hurdle. It is versus a much lower number. I think investors know that. Years that at the 38 they have been asked to meeting earnings, on average, they think that it will be 40 of january. By december, it is 6. 5 . Those numbers come down all year and they do not freak out. What makes him freak out is if the change occurs. People arent used to that lower hurdle. Who knows what people are doing . A you look out, there is Business Model of accelerating revenue. Do they have improving margins . You should not put a premium on growth. It is true that in slower growth, the industries with last year,remiums our outlook was more neutral. I get nervous about the premiums we are paying. If we are going to be in a faster growth world, you want value. If we will go back to this mediocre cycle, growth will get the beta again. What would you tell people . , we are bigst that and health care. Medical distribution of pharma. I do not own any biotech. We own a lot of software. That has been bad lately and her performance. I look at businesses that need to share. People are not hiring a lot. I like chemical. It really rallied in this late cycle. T will be quarried at corroborated by the fundamentals. In terms of the revenue, the annual forecast came in slightly lower. That might have been what investors reacted to. It goes back to the flat wide. We might be moving into positive territory. Adam parker, thank you so much. Pfizer isnext, seeking an offer from astrazeneca. We will have more details and tell you when to ask that this eel. Deal. We are here on bloomberg tv. The head of research is kicking it off. I will talk about pfizer. I am surprised we are not talking about this. Billion deal06 that they are building today for astrazeneca. They want to order them back to the negotiating table. The pfizer ceo is on the Charm Offensive with regulators and british lawmakers. They are trying to turn that around. Pita s are often a takes overr astrazeneca, they could be domiciled in the u. K. The government is incentivized to let them do the deal. Pfizer get a discount. And what is really interesting to me is that if this deal goes down, pfizer will be the erred biggest acquirer in the history of companies. Verizon, blackstone, bank of america. Wow. Warnerto was aol, time austin mark that was a big acquisition. Pfizer is a big company in general. You are talking all time stop it is often just about tax. It is strategic, but there is a big tax incentive. Wouldve other companies do the same thing . They already have. There are 19 companies this year. It is a new trend. It makes sense. If you will charge in so much money, they may as well go out or. What do they have keeping them here . The army, defending pfizer after mark i dont think so. If they want security, tight you can get a better tax rate in the u. K. It is a big issue. We talked about it a lot. Corporate tax for orme. It seems to be something we should be addressing. I want to talk about another issue. A different drug story. Torontomewhere mayor rob ford has taken a leave of absence. A new video shows him smoking crack cocaine again. Is the guy who admitted to smoking the drug and apparently that somehow. Himug dealer secretly taped allegedly smoking crack in his sisters basement will stop the dealer copy video. It was in his sisters basement. Allegedly. Dealer apparently will not release the tape unless someone pays him six figures for it. s brother is on the city council and he is the campaign manager. He says that people dont care about it. His Approval Rating is 40 . Those canadians. They are really liberal. He might be able to affect that. Race has pulled out of the , but he is not technically on the campaign trail. He could be. Busted,irst time he was he claimed it was a onetime thing. Now it is an excuse. He says he is getting help. I do not find it difficult to believe. All joking aside, and lord knows we can joke about rob ford all day long, i do not find it hard to believe that if you have an alcohol problem and you get blackout drunk, you do things you have no idea about. That he is smoking crack habitually. It is a good line. I like it. Maybe voters will say that he is going to get treatment and he will have a comeback. Moving onto music and coldplay. They may want to visit the local library. They will promote their upcoming album, ghost stories. They have hidden lyrics in libraries around the world. Some fans have found the handwritten lyrics. The new yorker found another one in the new york public library. That is kind of cool. In america, only 54 of people have been to the library in the last year. In england, it is 67 . They are much more prolibrary. They go to a wedding reception. The clues for the new York City Library was, in a library where ghosts were famously busted. I like that. They are trying to get involved with social media. People are talking about it. Guerrilla marketing. They have not put out a good records and parachute. Everything has been job since then. Have you listen to the new stuff . It is pretty good. We will take his offcamera. He has dealt a blow to the business of boeing and Lockheed Martin. Find out what the spacex founder did after the break. Break thes effort to Lockheed Martin and boeing monopoly over the sale of rocket engine seems to be showing some results. Yang yang joins me right now. Saying the russia card may have worked out. It certainly does. A complaint in federal claims court and a judge answered Late Wednesday night and issued a preliminary injunction blocking the air force and the United Alliance from buying any rocket russianmade rockets. A joint venture of Lockheed Martin and boeing, it uses that are supplied by a Russian Company and control i at the Prime Minister dmitry were goes in. Rogozin. Engine argument is one that hes using in his case to test the monopoly over the pentagons military satellite market will they are the only venture certified to operate within the program. They were awarded another contract back in december. It is that contract that elon musk wants to reopen for competition of stop the injunction is the core of spacexs argument. They released an argument said ula will work closely with the department of justice to resolve the injunction. Fighting words. I guess so. Thank you very much. We will continue to watch that story. Coming up, who will own the clippers next event . Donald sterling is banned for life from the nba. Is there a fight to retain ownership . He bought the clippers for 12 million. We will talk about that coming up. Oprah winfrey, david geffen, larry ellison. The list keeps getting bigger for investors interested in buying the l. A. Clippers. Who are the realistic buyers . Will Donald Sterling even sell . Here to break it down is bloomberg businessweeks respondent and the Division Chair and rector of the graduate Sports Program at a university. Who is really willing to pony up the amount of money they are talking about . It is north of 500 million. Donald, would he sell . I think his decision to sell will be a legal one. There are two aspects to it. His decision to sell will be a legal one. He will be forced to. He will have no sponsors. He will have no coach. Everybody has been pulling out. We saw that with sponsors and ticket races. What happens if they try to get a tv deal on a local network . Theres revenuesharing, but no one will come. What happens to venues vendors . He may not have a choice. There may be economic pressure. He bought this team for less than 20 million. 12 million in 1989. He should be incentivized to sell the stop one of the big issues is the tv rights deals. That expires in two years. It is way undervalued. They are only getting 20 million. The lakers get 180 million in the same market. They are more popular and they have higher ratings, but a good estimate would be 60 million. That will increase the value of the team. I wonder if the value of the team is somewhat increased. I know you have been looking into ticket sales because people feel like they want to get behind the clippers. I think a lot of people feel for the players. They are going out and having to play a game, given what your owner has allegedly said, that is tough. That shows the professionalism on behalf of these players. Might it sort of help the value of the team . Exit might help. If they know he is gone. If you know he is definitely gone, and you assume the legal assets will play out. You can operate and people feel good about the team. Not going away. He may do something about it. To bewill continue sponsors pulling out. Who wants to be part of that . You mentioned earlier that he might not have a choice. If done effectively what it has come down to . He could stay there from a legal perspective. He may want to get out because sponsors are getting out. What is the legal issue at stake . Like the legal issue is if he wants to fight, my understanding is that he will probably file some sort of antitrust suit. In the past, courts have been pretty liberal about antitrust rules as they apply to professional sports franchises. I think if you wait too long, will happen is sponsors will no longer come back. Fans may decide to boycott. Im curious as to what players are going to want to play for the clippers. It will be pretty hard to recruit. Betsy was a lawyer before he got into this. He loves litigation. What you are saying, it will probably happen. This is a guy who has never sold anything from comics collections as a kid to apartments. He does not want to sell. He will go down fighting. Where does it leave all of the stakeholders during during their hats in the ring . Theyre still competing in an auction process for carcass of whether he wants to sell or not. It will be for sale at some point. They want to be ready to go. The other owners will pick them. What happens to him . Sterling . Do you think eventually if you felt it, he will take the money and go away . I think in his situation, he is one of those people where we would like to see him go away and go away quietly. As you said, his history is to fight, fight, fight all stop for the good of the team, he is trying to maximize the value of fighting. It is a losing value that battle. I thank you very much. Thank you. Speaking of people who have the money to buy the clippers, at the Warren Buffett shareholders meeting, tens of thousands of investors will descend on omaha. For many, mr. Buffett is a paragon of capitalism. They seek to follow his example. A 29 euros activist investor working for mr. Buffett when he was 12 years old. Lets take a look at this. My name is ryan morris. Im 29. I am worth 15 million. Warren has said that he lives like you makes 150,000 a year. Except for the private jet. Before the berkshire meeting, to pay hours that to the great church of frugality, it was for guys who work at hedge funds and kansas, flew to which is cheaper than omaha. We drove to omaha altogether. We stayed in the crappy his hotel. You go to these events where they have free drink some free food. We got it down to 48 a night or the four of us. It was the busiest weekend of the year. Was 11 years old, i had an idea that i want to change the world through science. My father introduced the idea that you will not make it happen. The guys with the capital will make those decisions. So that sort of flipped a switch for me. Theres this guy, Warren Buffett, and he sounds very deceptive and simple deceptively simple stop the fact that it was accessible at all to a 12yearold is amazing. That speaks to the power of how we communicate in a way that is very primal and accessible. He says, trying to choose your euros wisely. He has been my hero since i was welkers old. He has said 12 years old. He has set the best example that any business or son has had. I will be joined by the ceo of a company attempting to shake up our education system. Hes only 23 years old. The cofounder of code academy. That is coming up next. Backs it is the language of the future, coding. It is changing the way we look at the classroom and the content. Company thatis one is shaking up this industry. It has 24 million coders and growing. It is a website teaching students and individuals how to code. Now it is redesigning its website in an attempt to educate and become the linkedin of coding. , and itned by the ceo is good to have you here. Tell me about the website. 24 Million People are now on their encoding. What is it that you are doing . Reallyanted to make it simple for anyone to learn the skills they need to find a job. It is easy to learn and easy to use those skills to build things. What are the demographics . 70 are outside the u. S. Percentage is female. The big concern is that there are not enough young women that are looking at Computer Science and engineering. That is something that we have tried to work on. How have you done that . We have made entry easy for anyone. Regardless of where you come from. We are building a product that works. What do you mean by wanting to become linkedin of coders . What we are doing is building the easiest way for people to lose build the skills they need for a job. Something that they are teaching in middle school . When is it appropriate to start learning coding question mark you should be in middle school or earlier. Some countries are starting to teach programming from the age of 10 or 11. It is this language of the future. How do you think about coding . Do you think about it as a language . It is the literacy of the 21st century. Everyone will need to know this. Definitely. Would you need to know code for . It enhances your Critical Thinking skills. Every industry has been reinvented by programming. Understanding that is critical. What is an elementary strap that . People want to learn simple adult algorithms. How younger some of these people . We have people around the age of 13. This is an opportunity for them. I remember taking a coding class one summer and being really into it. I went back to school, and there was no continuation of stop there was no website for me. If you can get kids young, that is important. Is about getting kids and adults were looking to learn skills. They are on their phones and computers. You are telling me also about the demographics. 36 female. 70 outside the u. S. What is the age range . It is between 18 and 28. We are seeing an even distribution between every age level. People are using this for a variety of different reasons. You are 23 years old. When did you start this . I started it two and a half years ago. I was 21 at the time. I was learning programming and i was very frustrated. I saw my friends lacking the skills they needed to find jobs. Users,deeper million that is a big success. What is your future plan for the company . We are looking to teach anyone, anywhere these goals they need to be successful stop we are the market leader. We are reaching more people who have the skills. We wish you luck. Ceo and cofounder of code academy. Hisceo of bonobos started clothing company. Believes in the power of fashion and first impressions. He is the focus of our latest installment of what i wear to work. We cannot walk around naked. That means we have to were close wear clothing. It is an expression of who we are. Im in the business of making men feel awesome about what they wear. My file has been to overdo it a little bit. Sometimes i wear too much color. I only wore a pink shirt today. Finding the right balance is the key. I was not able to really stand with my shoes. But if i wear it formally up top, it is an open question on whether it was achieved. I am proud of these genes. Is a clean pair that fits well and is dark. That is the staple of how i think about denim. I was about often and i found his vintage rolex. I was debating whether to get it to stop he said it is from 1979. That is the year i was born. It was Retail Therapy confirmation, but i went or. Lot of how human beings operate is on first impressions. We need people quickly and the way that you care yourself is in order. Important. Next, there are reasons to celebrate. The weirdest celebrations in may. Stay right here. Street smart is back in two minutes. It is may 1 and a lot of people are celebrating. We will take a look at some of the strange celebrations happening. All of those lost socks. If you want more, you can go to bloomberg. Com. That is it for todays edition of street smart. Tomorrow we will be talking to a lot of interesting people including the president of americans for tax reform, grover norquist. We will also talk to marsha blackburn. I will see you there, live from d. C. That is tomorrow. I think i just saw you all. It is time for on the markets. Im trish regan. Stocks are relatively unchanged. The dow closed at a new record high. The nasdaq was the best performer. Now closed higher for the past four consecutive days. It has boosted earnings. Stocks and return to bonds. Some mixed economic report of the investors looking for a safe haven. The yield on the 10 year fell to eight two week low. A two week low. It is not just u. S. Economic data that is moving the market. Adam johnson took a look at another big influence from overseas. Take a listen. It turns out that china may be having a much bigger impact on u. S. Companies then you realize. It is time for a little insight and action. Lets look at the headlines. Pepsi, china sales are up double digits. The u. S. Declined. Growth in china. Salesna sales rival u. S. And apple computer, we learned in their earnings for or that china sales are up 13 . That sent apple shares up about 8 . We spoke earlier with the man who founded and runs an investment group. Add agency group in the world. We look to china for a lot of technological developments. 73 of smartphone platforms are entering. Google has penetrated china in a subtle way. What we decided to do is take all of this under consideration and try to figure out how we tontify chinas exposure u. S. Investors. Here is what we did. We started with the s p 1500. We found 82 of those companies are selling in china. Of those 82, 45 yards adding their business in china. We narrowed the list further. 22 companies are expanding at least by 10 . Here are the top 5 . Diodes, semi conductors. Boeing, it gets 12 of its business out of china. Alliance one, terror, sothebys. Check it out. U. S. Companies are selling and growing in china. China is also having a big impact on crude oil dropping to a sixweek low. U. S. Crude inventories extended a record high. Gold also felt. Fell. It was the longest losing streak in a month. Improvingnomy highlighted by todays data. For on the markets, im trish regan. Forhis is taking stock thursday, may 1, 2014. Im pimm fox. Today was a day of emotion. An emotional day at ford where ceo officially named the next to get the next chief executive. More on the band behind more on the nba dan of Donald Sterling