Editor in chief of Bloomberg Businessweek, joel webber. Lets start in the business section. A story that is fascinating came out a couple of weeks ago. It is about a trifecta of individuals, well known individuals, warren buffett, jeff bezos, and jamie dimon talking about fixing the health care system. Right. The biggest guys around. The details around this still remained kind of hazy. What will actually be the solution in health care . How are they going to try to fix this . Theyre trying to find a ceo who can spearhead this initiative in the three companies. Amazon. Com, berkshire hathaway, and jpmorgan. What has been interesting, and where we try to pick up the narrative is the reaction within the industry. Because the health care industry, amazon is at the door, this is a big deal. That is where we picked up. Julia this is not what we were expecting as a foray into the health care. We should make the point that at the moment they are tackling the situation with their individual companies. As you point out, what does this mean ultimately for all of the individual players here . The insurers, the pharmacies, particular . In carol pharma, right . Right. All of this is a massive cocktail of what is happening in health care . Why do prices keep getting so much higher . And consumers feel like they are getting the shortest straw of all. What the speculation is there are middlemen, pharmacy benefit managers, and that is where there seems to be a focus that this triumvirate can bring to bear. Julia yes, because the big pharma say look, we are not mispricing the drugs. A lot gets creamed by the guys in the middle, the insurers. The guys in the middle, the benefit managers as you point out. Carol when it comes to drug pricing, this does not totally makes sense. The Drug Companies set up pricing, then there are refunds that come into play, and the relationship between big pharma, the pbm, and the Health Insurance companies has been a cozy relationship. Joel and it is very opaque. Carol right. Joel that is why this triumvirate is causing turbulence in the market. Carol yes. Joel because what they could bring to bear, what if we negotiated directly with pharmaceuticals . Carol cut out the middlemen. Hypothetical. We dont know what will happen yet, but if you could do that you would put downward pressure on a bunch of this opaque market that is proving to maybe be a little too lucrative for some players. Julia in the middle of this you have a u. S. Administration talking about repealing and replacing obamacare. Obviously, we have seen some failed attempts, and the president talking about drug pricing as well. Joel this will be an ongoing story that all of us will be watching. And this is just the appetizer we want to give you, because we are just trying to inform you. Because this story will be one we will be watching throughout the year. So think of this as the appetizer. Understand the players, and we will get to an entree soon enough. Julia yes, what about the main course . Lets jet to the u. S. Cover and the asia cover this week. We are honing in on boeing, a huge industrial. Joel it is an amazing story, in part because of what boeing has been able to do as a business. And if you look at the dow, it has basically been the Top Performing stock in the dow in the past year. Carol shareholders are happy. Joel investors are ecstatic about this. How did they do it . That is what the story is about. And there is a lot of nuance to that, because basically everyone else in the world, other than investors and employees, are like, boeing is hurting us. [laughter] julia yes. They are flexing some muscle. Joel that is an understatement. Carol on that note, lets go to this story about the boeing ceo. He is driving everybody crazy, except for investors. We got more from julie johnson. Julie we think we know boeing. They had been around for 100 years. But in year 101, they have overtaken ge to be the most powerful and largest industrial company, and they have really started to shake up the marketplace in ways that we are just now exploring, and whose effects we do not know. Julia their old slogan used to be working together. How far does that slogan apply to them today . Julie boeing today is really in every speech you hear a Senior Executive give, that the phrase comes up, compete to win. And this is a company that seems unafraid to play hardball, to knock heads together. And if people do not like the consequences, they dont seem to care. Julia how much of this has to do with the new ceo . I mean, i call him new. He has been around since 2015. Dennis muilenburg. You described him as turning unapologetically hardnosed under his reign. Julie i think boeing has always been a tough competitor. But dennis is a driven person is very driven, personally. He is extremely charming in person and charismatic. But again, he just he has this goal of making boeing a Global Industrial champion, sort of a 1990s era ge. He is you know, his foot is on the gas. This is a company that seems right now determined not to let up. So i think in some regards, companies reflect their leaders. So that might be true of what we are seeing at boeing today. Julia the share price has doubled since january of last year. It is the best performer in the dow, so investors clearly rewarding them at this stage. They are happy. Julie yes, absolutely. And one of the things that is kind of fascinating is ge has imploded. For shareholders who want to have Large Industrial stocks in their portfolio, boeing has sort of become the only game. And i think boeing has, in terms of their share price, benefited tremendously. But at the same time, its sort of reflective of the underlying strength of the business. They are very focused right now on profitability. Really shaking up the Supplier Community with some of the ways they have gone about gaining that profitability. And they are contracting. But that is a very highlevel picture, you know, with a thousand Little Details needed that have sort of made it come together. Julia the Cost Initiative they are running now, partnering for success, critics have called this pilfering from suppliers. Just give us a sense of what they are doing and what they are achieving, because it is creating a fundamental reshaping of boeings business at the same time. Julie yes, that is absolutely true. This started in 2012. So under jim mcnerney, the previous ceo. And i think at that time, boeing was going through tremendous soulsearching after the 787 dreamliner. That was enormously draining on the company. Their early issues with that plane, the manufacturing problems that led to it being three years late. And so i think boeing took a look around them and said, why, like other Large Industrials, why are we plodding along with singledigit operating margins when our suppliers are earning double or triple that . I think there was a sense that , you know, we have to put our needs and profitability first. Carol the design director put boeing on the cover of Bloomberg Businessweek. We had this excellent shoot with the boeing ceo, and he has a beaming smile. We kind of coupled that with this junkie typeface chunky typeface to give you a feeling that they are just kind of julia the sky is the limit. Carol its great. Its a wonderful picture of him. He looks like he is happy. He is glowing. How many pictures do you take of a ceo when you do Something Like this . I mean, it is a lot of photos, as much time as the ceo will give us. We will take as many as we can. Carol do you change the backgrounds . Yes. We also shot throughout the factory. You will see inside of the future, we have all of these photos of them making planes. Its really beautiful. Julia that is the big story. The Cost Initiative, the cost of partnering for success and the pushback on suppliers. You have been cute with that and the plane in the background. This is the fundamental part of the story. It really places us in the environment he is pushing for. Julia and shaking things up. Yeah. Julia up next, why moscow is not talking about the hundreds of russian mercenaries killed in syria this month. Carol and the global ambition of wwe. Julia this is Bloomberg Businessweek. Carol welcome back to Bloomberg Businessweek. Im carol massar. Julia im julia chatterley. And you can find us online at businessweek. Com and on our mobile app. Carol in the politics section, u. S. Forces killed hundreds of russian mercenaries in syria. Carol julia and the incident is raising the possibility of greater conflict between washington and moscow. Carol heres editor matthew philips. Matthew it has been an active start to the month of february. We have seen an escalation in tensions. We have seen some actual , real shooting going on. We have seen aircraft being downed from iran and turkey and russia and israel. They have all seen aircraft shot down over the first part of february. The most interesting event, the most seismic event, happened on the night of february 7 when it seems that a battalion of what by all accounts seems to be russian mercenaries, numbering in the realm of 200300 were killed by a u. S. Backed force led by u. S. Forces and the kurds in a failed attempt to take oil fields the kurds have been holding for the past few months. Carol who was behind the russian mercenaries . Do we know . Matthew it is pretty murky. The kremlin, a putin spokesperson would not address this. They are not official russian troops. But as we know, given some of the incursions russia had in ukraine, they often are not wearing official Russian Military gear. It seems that these few hundred mercenaries were under the control of a firm known as wagner. Which, to put it in blunt terms, is kind of the russian equivalent to the u. S. Based blackwater. These are private mercenaries. Not unlike the folks we sent into the ground in iraq. They were not part of the official u. S. Military, but they were there to fight. Earned and wagner is an organization that is known in man who ised by a known in russia as putins cook. He owns a Catering Company that does business with the kremlin. He also seems to have control over these military units that are controlled by wagner and have been operating in syria and helping assad shore up his game. Julia i think you said it best. What is so surprising, puzzling , to use a word that you used in here as well in this this is , for all intents and purposes it seems to be some kind of rogue attack. But if you look at the response from the russians, not surprising given that they deny knowledge or involvement. But the United States response also seems pretty weak, despite action on the ground. What is going on here . Matthew defense secretary mattis, all he would say on the record was that this is perplexing. In an after action report. And i think that is an accurate assessment. They were very confused by what happened. We have by we, i mean we have the United States forces on the ground and embedded with the kurds, and we are in communication with the official channels with the Russian Forces that are there. This is like a jigsaw puzzle of a battlefield where proxies of big powers, the u. S. , turkey, russia, iran, israel are all waging wars. And there are lots of interlocking alliances and things like that, and especially when it comes to this part of the country where the euphrates cuts between here, the u. S. Is with the kurds, and on the other side, you have Russian Forces that are with assad. And our people are in communication with the russians, and it seems like communication broke down. And this is by the way, fantastic reporting from our moscowbased reporters, it seems to indicate this was a rogue operation. We are not sure who gave the go ahead on this. But there was communication throughout, during, before, and after about, why are you moving . Stop moving. We are going to attack. And that is what happened. There is a lot of mystery about the incentives and impetus and who called this in. But you are seeing hospitals in st. Petersburg and moscow filled with hundreds of wounded these past few days. Julia up next, the problem children of Exchange Traded funds. Carol plus, how one entrepreneur leapfrogged his Payment Company into the mobile era. Julia this is Bloomberg Businessweek. Julia welcome back to Bloomberg Businessweek. Im julia chatterley. Carol and im carol massar. You can also listen to us on the radio, on sirius xm and on and am 1130 in new york, and a. M. 960 in the bay area. Julia and in london and in asia on the Bloomberg Radio app. In the finance section, investors are finding reasons to worry about certain Exchange Traded products. Or etps. Carol over 400 of these use derivatives to raise outside returns. Julia and that is raising red flags for market watchers. Here is our reporter, rachel evans. Rachel last week, we had the blowup in xiv. It bet against volatility. So it was betting on car markets. What that brought into focus is how some Exchange Rate products Exchange Traded products have a complexity at their hearts. They are not as risky as vix but there are some products that include derivatives at their heart. I have people questioning a little bit of what do they own in their portfolios . Julia there are a lot of technical terms in there. Just explain exactly what investors were doing when getting involved in these products . Rachel sure. First up, lets talk about volatility. Volatility is a way we can measure exactly how active the markets are in terms of price swings. Julia the up. Rachel exactly. When markets are calm, volatility is low. When markets start moving, volatility moves up. Carol markets have been, in terms of volatility, low for a long time. A lot of complacency in the market. Rachel very much so. We saw that suddenly change. That creates problems for products that bet on an against volatility. Julia they were betting volatility will remain low. It has been for a long time. Exactly. The short trade was popular indeed. And we really that start to get we really saw that start to get washed out on monday afternoon. One place we saw that was in the Exchange Traded fund, or product world. We saw Exchange Traded notes. Etf. etn versus ecp, Exchange Traded products. An etn, which is a debt obligation from its issuer, it started to run into trouble because the index it was tracking really moves so much over a short period of time. Credit suisse, on tuesday decided it would wind up the product to so anybody who had carol by winding up the product , you can say it can go down to zero. Rachel right. This is what we saw. Anybody who had come into the note over the previous weeks or months, in fact those who had come into the week before this happened, over 500 million flowed into this note. All of those people were sayingith Credit Suisse we are accelerating this note we are terminating. Julia does that mean they lost money . Rachel absolutely. This product went down 90 in a space of a day. That will now be liquidated later this month. And people will get back whatever the price was at that point. Julia who was actually invested in this product . Was it sophisticated investors or was it momandpop . As we talk about, the Retail Investors invested in is to. Rachel it is difficult to know who owns these things. If you look at the holders on the bloomberg terminal, youd be left with the impression it was very sophisticated investors. That is who it is aimed for. However, talking to a number of Retail Investors, it seems like that was not necessarily the case. There were chatting forums about this online, talking about how xiv was making people a huge percentage every year. People were piling into this, putting all their savings. I have spoken to several people who lost thousands of dollars. Carol that is what is really tremendous. Because while the markets were complacent, you have done great reporting on all this, that while the markets were complacent, people were making crazy amounts of money. That inverse volatility index was making so much money. Rachel i think, in fact, on monday, when volatility started to spike, that was something that people thought, markets have been calm for a while. We will see that spike disappear. Now is a great to go short. Time to go short. No is a great time to go short. Instead, they got washed out. Carol in the pursuit section, this weeks game changer is steve street. Julia first he invented prepaid debit cards, now he has reinvented his company to help facilitate mobile payments. Carol we got more from our reporter. Denny steve is the founder and ceo of a Company Called green dot, a company that probably not a lot of folks have heard of, they provide prepaid cards. But they are a bank, and they have been making a lot of interesting deals in silicon valley. They have worked at apple and to build out their platform. Julia take a step back. Because he is kind of a visionary, i think. He foresaw the shift to mobile banking. But it was in a situation where he was like, i will not be quick enough to take advantage of it, so he made some pretty bold moves. Jenny correct. Yes, back in 2012, he could see that the Banking Experience was moving to mobile phones, and he felt that his company was not going to get there in time with the technology they had. So he went out and he did an acquisition of a company that was called looped, it was a pretty weird one at the time. They were a dating app that had failed. Jenny but it had a lot of Geolocation Services and Interesting Technology. But the bank basically said, i dont care what technology you have, i want your t