That directors and shareholders are standing up a much stronger way than before. It is not always accountability that will come for a prosecutor or regulator. You have this massive breach at a lot ishat helps how people see how a ceo who did not prevent against it lost his job. That means something. It is not just enough to hold the id person accountable. But when people think their entire ability to run a companys way to be in jeopardy because they are not warning against this risk that people of been warning about for a long time, that is something new we have not seen in the last few years. We have to end it there. Thank you so much. [applause] Erik Schatzker with the Southern District the attorney for the Southern District of new york. Bottom line starts right now. Ati am Mark Crumpton of the World Headquarters in new york. We have full coverage of the stocks and stories making headlines today. We begin with our chief washington correspondent it are good ideas of the white house as the secret service considers new Security Check points following that embarrassing breach over the weekend. Afternoon. Certainly an embraer sing breach. In very tough questions being asked of the u. S. Secret service, in light of what happened on friday night. This unprecedented breach, a jumper over the plants of pennsylvania avenue, crossing over the lawn before making his way into the doors. Ble to actually a enter the white house. That has immediately created some changes here. We have fence jumpers all the time, but this individual was able to breach the actual physical building, the white house itself. Apprehended at that time. The president and his family were never in any danger. They had left a short time earlier for cap david. This is clearly a concern, the press secretary was asked for the president s reaction. s family lives in the white house. So he is obviously concerned by the incident concert occurred on friday evening. At the same time he continues to have complete confidence in the professionals at the secret service to do the very challenging work that i described earlier. Complete confidence in the secret service. For a tough questions being asked. And some of those immediate changes, you are seeing more personnel the fence line on pennsylvania avenue itself. There and changes within the perimeter itself. You can see investigations going on. Officers looking at exactly where he crossed into the white house property. More questions to come, including the possibility of so much more severe changes that could affect the Public Access to this building, which you know is one of the most popular tourist destinations in washington. Do we have any idea when this review will be completed . We just know that they are working with a sense of urgency, but there is no deadline set. Some of the questions and changes, checkpoints before anybody can enter. Perhaps moving a barrier further along that fence line. It would change the feel of the openness of this facility to tourist, but it is certainly under consideration. As a logo, even the fact that no cars can travel on pennsylvania avenue is still a sore. 4 point for many. Coming up, Climate Change. We will talk to the top Climate Change official on what needs to be done. Tonight on charlie rose, theater theo is one of the most Successful Technology entrepreneurs in the world. Called 021, is notes on startups or how to build a future. He says that the developing role should copy the innovations set forth the developed world. The critical thing in this country is for us to have more innovation, more technology. Computersoutside of as well as inside computers. Innovation in energy, innovation and health care, biomedical, transportation from there many different areas we can be innovating. Technology often means Just Computers today. Will we lose our Technology Lead to china, or not because they have inherent social limiting factors . Mistakenk it is a big to underestimate china. I would not say there is anything in the Chinese Culture that means that they are uncreative or cannot innovate. Problemsk the kind of we have are very different from china. China needs to just copy things that work for the next 20 years. That is true for all developing nations. They can skip a few steps. In the developed world we need to innovate. Things that copy work they will be able to improve tremendously. We need to innovate in the developed world. You can see the entire interview tonight on charlie rose at 8 00 p. M. And 10 00 the new york time. On tuesday World Leaders will gather in new york city to attend the United Nations climate summit. The goal is to institute a new treaty on the end of 2015. Thestiana figueres is executive secretary and she tries me in studio. Thank you for coming today. Tomorrows summit is not part of the formal negotiation process. What do they hope to achieve . Yesterday we had over 300,000 people in this industry. We must address tremor claimed Climate Change. Corporations are coming forward and saying they have the technology in the capital, we can adjust Climate Change. And bottom line form tomorrow, 120 from tomorrow. Heads of state under one roof for one topic, what are they going to do on Climate Change . Addressy must we Climate Change, not only will. E, representatives from china and india will not be attending. They will be there. They are just not there at the head of state level. Is tos really important, listen to what china is going to announce tomorrow. They will begin to elucidate for us what they are already doing and what more they are going to do. I think we will be impressed. Difference from someone at the head of state level versus one of the representatives . I think the fact that we have state isheads of incredible. Chinact that the head of could not come is immaterial because he sent his person in charge of domestic economics of development. He will speak for what china is doing. Yuan secretary general ban kimoon says that china and the United States should leave this debate. The Obama Administration announcing that proposal reducing Carbon Emissions from power plants by 30 by the year 2030. Is that enough . Know that is not enough. I just came from hearing secretary of state carrey announced that the United States is going to be ready to come forward with its new commitment by march of next year which is when all countries have agreed to come forward. He is actually inviting china same. Me into the that will be an incentive for all other countries to come forward also. There is a political will in washington and beijing to take the lead on this . Yes. Together they make up 40 5 of Greenhouse Gas emissions. They talking to each other for a long time. Thatgovernments understand they each need to do their best domestically. But also that they can do much more fair with each other. A pretty good collaboration that they would not be able to do individually but they can do together. They will make that public. Island up some information, ng moretions representi than 150 billion in assets have led us to do vast fossil fuels. What role do they have an phasing out fossil fuels. What does that mean for their bottom line . There was concern that maybe it would impact them negatively. This could turn into a positive. It is absolutely a positive. I just came from interviewing the ceo of apple, the Biggest Company in the world, and the ceo of idea. Kea. Tim cook said it is precisely the capacity to innovate that will take us forward. You want regulatory certainty because he understands that they need to move forward for both battlelines together. Image to be profitable and environmentally friendly. There are many products that can only produced if they actually attack both bottom lines together. Kea saidther side, i we want governments to divorce regulatory certainty in the shortterm, but we also want them to invest a longterm certainty because that is how we can make our invest. Ment. You mentioned the Global Climate rallies that were have overrun the world yesterday. Good tens of thousands and hugh ark city you had tens of thousands in new york city. The levels of Greenhouse Gases are at global alltime highs. If the policy makers get the message yesterday from people rallying all over the world . Are they listening . s i believe they are listening. Yesterday was unprecedented. I was very grateful for that Public Mobilization guest for the first time we had a very clear voice in public opinion. We need the Civil Society to come forward, we need corporations, we need the investment sector, and of course governments need to work together. This is not one sector going to islve this problem, it everyone working together. To you think you can get everyone on the same pay . I think i can. I see the evidence every day. Thank you so much. To meetpleasure you. Coming up, existing home sales fell month of august. Homeses of existing u. S. Declined in august for the first time in five months. The National Association of realtors say sales dropped to an annual pace of 5. 0 5 million homes. Ceo oft kelly is the re max, and she joins me from the companys headquarters in denver. Welcome back. Good to see you. What happened last month . As you know, the reality is it was a very slight decrease. Back, we anticipated that 2014 would have stable existing home sales, equal to 2013. Which it is. 5 prices increasing ant per year. We are at a 4. 8 percent increase. It was not a big drop. Why are they rising at a slower rate than last year . A number of reasons. First if you look at the seasonality of the market, which we have, we have very low inventory right now. 5. 5 months of inventory. There are a lot of homes in there that have been on the market for years. They are very undesirable. When you take those out of the it is evenicture, lower. And as you have low supply, and you have a high demand, the price goes up. Not as much as last year. Why are we not seeing a disconnect between home sales and home Builder Sentiment versus Housing Construction . Looking at new homes, we are terribly unbilled to under bill. We have a tremendous amount of amped up demand. Building 1. 5 million new homes per year to meet demand. Sales are about 500,000. Opportunity had the to go to a conference with homebuilders. Their confidence is actually up. But it takes quite the process to be able to get the land, get it approved, and build on what they need to do. Overall i think we will see the improvement in new home sales and new construction go up as we go into 2015. Are reporting the strongest increases in housing prices right now . Strongest, you are seeing a lot on the east coast and youre actually seeing a lot on the west coast, because the inventory in california and las vegas is so low that youre actually seeing doubledigit increases in prices there. The middle part of the country for most part, because they did not go up so high, they did not go down so low in the recession, they are very stable. Im speaking with margaret kelly, the ceo of re max. All eyes on Housing Markets in the west and south these days. The denver Real Estate Market has been doing well after years of underperformance. Why the pickup, will it move sustainable . It is hard to predict what is going to happen in various markets. Put it in perspective. As i look at the Housing Market i still believe that this year we are in a recovery that we are trying to get our foothold into. What is going to happen next year . Last year we had tremendous sales, price increases, but people keep saying is that affordable . If you look at the top 100 metro areas in the United States, 94 of them it is cheaper to buy than it is to read. Nt. But we have some holdback from people getting into the market to be able to buy. We have student loan debt, we have tight lending. All of those things are actually putting pressure on various markets around the country. Some more than others. In colorado we are doing incredible. There is a lot of building going on, a lot of people moving in. There. Want to be other areas of the country or a little bit slower. California, double digits. We have seen in real estate, is mainly due to investors and allcash sales. Do these numbers are they skewed because of that . Recession started, the majority of the buyers were investors. They were up to almost 40 of the market. Buying homes originally to flip, and then they thought they would rent because there was a huge rental market. Rightnow investors are only about 12 of the market. It is really home buyers that are in it and not just investors. They served a great purpose during the recession, but what many are now seeing as owner occupants are now buying the majority. Even with average Mortgage Rates, our families being priced out of the market . Not so much the Mortgage Rates as it is student loan debt. Thisis an interesting tuesday, home prices have increased 19 in the last two years, but wage increases are only 4 . A combination of wages, student loan debt, and tight lending. All of those things play into what is affordable for a homebuyer. Ceo of re max joining us from her companys headquarters in colorado. Always a pleasure. Thank you for your time. Minutesoming up on 26 past the hour. Bloomberg television is on the markets. Julie hyman is standing by with the details. Thank you. Lets take a look at where stocks are trading at where things some declines, as we have seen all session long. Two main reasons, we have a analyst talking about a stimulus for the chinese economy. Also in terms of individual stocks we are watching, looking at apple today, the largest overny announced it sold 10 million iphone 6 models in the first weekend. That is when new versions hit the shelf. We are watching shares of alibaba. Those are settling down in their second day of trading. Exercisingiters a green shoe option to purchase extra shares. It is one of the most Expensive Companies traded in the United States. We will be back in 30 minutes. Welcome back to the second halfhour of bottom line. Bankers, policymakers, and investors are attending the most influential summit here in new york city. Stephanie ruhle is now joined by the chief Investment Officer at pimco. Thank you. Thank you for being with us. The equity markets. Still room to run or things have peaked . Peaked is a big word. I think we have air pockets. Growth is lower, inflation is lower, and theres a lot of slack in the world economy. If you look at the world we are the u. S. And the u. K. Are slowly normalizing, but this is not a world of dramatic tight evening tightening. For market has room equities to go higher. The key thing is that earnings must be delivered and what you had in the last few years really is a rereading of expectations. You really want growth to be delivered. With ours the case, assumptions of lower rates you will have opportunities to get into the markets and benefit from those airpar pockets and positioned herself. Yourself. Are you feeling the pressure to capture investor and get them into equities . What i am focusing on is clearly performance, building is ay for pimco, and it fascinating place to do so because the intellectual capital in the firm is so large. I also think to pick stocks you really need to have a coherent macroeconomy framework. Roles works inck that framework, and pimco has that. Simply to ben goal long on these markets because momentum is on your side . I think the next couple of years are not about beta, they are about also. You want to have high active shares, you want to have stockpicking skills because the beta market is much more volatile and full of air pockets. Where do i want to be positioned . If i think of low rates, i want to have some income in my portfolio. Dividend strategies of hybrid shortages doing quite well. If i think of air pockets, i capitalhave preservation like a value strategy or a long short strategy. Is going to growth be lower for multiple reasons you also want to have some very attractive Growth Equity strategies because i think growth will be persuasive pervasive. Like geopolitical has been underpriced . We are less underpriced than we were three months ago. Exec and worst in the last three months things have gotten worse in the last three months. Oblivious people were to it. I am watching is is there any development of complacen cy. Are you concerned in any way . We saw the extraordinary success last week of the ali baba ipo. Is it a warning sign for you that this feels like a bubble . Everyone is clamoring for when they did not know the nuts and bolts of this company . The success of a Company Called . 10 which is a fantastic performer. View ofral europe the world, you really want to tap into areas of growth. And clearly with Internet Sales rising very sharply in china, rise of gdp the from basically nothing, you have a very strong growth engine. Appeal ofis is the the stock, the lack of the growth of the world. That is what you are seeing. I see growth in very specific scenes and areas. We talk about Climate Change, you talk about disruptive technologies, and all of this. I think those are areas where you can find growth and clearly you want to make sure youre not positioned on the negative side of it. There are still longterm schematics that i find appealing on both sides. Great to get your thoughts, and honor to speak with you. Back to mark. Thank you to you both. We will have more from the most influential summit coming up at the top of the hour. Coming up, fly ms. Islamic state militants fighting Islamic State militants. When the u. S. Congress returns on november 12 for a postelection session, lawmakers are expected to take on a broader debate over the use of military force to fight Islamic State militants. This morning i spoke with the about the planr to defeat isil. I began by asking her if the militants are a threat to national security. I think they are a threat. Am supportive of what the president has outlined. I hope he gets a Broad Coalition that we really need to be effective this week it i guess he is speaking to be u. N. It is very important to do. Statest read the united not just to be the United States. It is very dangerous situation. Quirks would it be a coalition of mainly arab states . Would they be responsible for boots on the ground . Ideally. They shortly should feel the threat as much if not more intently than we do. I do believe it should be there boots on the ground. I am not supportive of putting boots on the ground for americans. I did not support the original resolution going into iraq because they were not the ones who attacked us on 9 11. It was a serious mistake that we are continuing to pay for since then. Given a series of very difficult choices right now, i think the president is making the right one. Be defeated by an air campaign led by the United States . The joint chiefs of staff said that boots off the ground on the ground is not off the table. Is not whether there are boots on the ground, but whose boots. Who is involved . Is there a coalition . They cannot just be the United States. Weis there possibility that could see this expansion of the war against isil if the u. S. Does in fact decide that we need to go inside of syria and root them out . Work, do wee one have a coalition, that is what we need to figure out first of all. Getting that right. And then we go from there. Cannott he just just be americas challenge or issue. It has to be not only the middle east, the arab countries, but were being countries and everyone who cares about this extremely radical and dangerous group of people. Joined together, we will be able to make sure that they are contained and defeated. We just spoke about americas challenge, another one seems to be ukraine. The president spoke to a joint last week saying that blankets and goggles are fine, but will not do the job. This is another step by step process that will take supporting ukraine. Think he is very grateful for the friendship and support of the United States. We certainly need to be providing them with assistance, but we also have negotiation roles. Anction weortunately in the world are in the right now, things are not simple. Theyre complicated, they take coalitions, they take multiple strategies. Against thections russians working because they do not seem to be deterring president putin. If anything we should be ratcheting up the sanctions. The midterms are coming up. Says thatcal report the senate race is a tossup. What are your thoughts . It does not feel like a tossup. The congressman is very strong. It is tight and it is always tight. I will say he will be successful because he definitely represents the values and interests and people in michigan. Of what runs terms our economy in michigan. He is running against someone who thought we should not have helped the auto industry. He was one of the leaders in making sure that we can support the industry which is not only back on their feet, but roaring back. Speaking of support, there was a business summit in the city of detroit is a couple of days ago. Is detroit on the road of recovery . Is the bankruptcy going to give them a new start . Road is definitely on the to recovery, it actually was on the road to recovery before the bankruptcy to place because we have ceos running towards the city rather than away from the city. Are you surprised . Im very proud of it. I proud of those ceos that have decided to make a longterm, aggressive commitment to detroit. Michigan democratic senator Debbie Stepanov joining the earlier today. It is time for your latin american report. Citibank plans to ask a new york judge june delay his ruling regarding a 5 million payment to holders of argentine bonds. That is a comment made by a big lawyer last friday. They have threatened civil and criminal sanctions including a possible nationalization of citibank argentina if they the resolution. Ther today we will have highlights of the latin american forum. To leaders will be on hand discuss the look for their countries. And a reminder, we are only a few weeks away from the debut of politics broadcast. Bottom line continues in a moment. Inwe have new developments that white house intruder case we were telling you about of the type of the hour. Omar gonzalez has been charged with unauthorized entry at the white house. He has been ordered held without bond. He jumped the fence over the weekend, made it through the doors of the north portico. Officials found 800 rounds of ammunition in his car. Weapons separate state charges in virginia. We will bring you more developed as we get them. The World Bank Says governments representing almost half of the worlds population are now on board to do their part in cutting Greenhouse Gas emissions. Trish regan sat down with world a resident Jim Young Kim on this latest development. This is significant. I literally just came from the interview here in midtown manhattan. He was saying that we need to see more and more countries and corporations sign on to this. He wants, and does believe that countries like china are going to recognize the threat of coal, and are making efforts and strides to change some of their environmental procedures. Process, ofoing course, but the world bank is encouraged a little bit by what they have been able to accomplish this far. We also talked about mario draghi and the ecb, and the quantitative easing. We also spoke at length about crisis. A he is a former position as a lot of views on what can and should be done to fight this disease. He spoke quite favorably about the decision to put 3000 troops over there to deal with this crisis. I was speaking with christiana figueres. Does dr. Kim feel like the World Community is on board with this . He stressed that over and over again. You wonder how much is the pitch, and how much is the thing you want to believe, that everybody is very much on board. It is something that he emphasized and said that some of these countries even surprised him. Like russia, like china. I will have that whole interview be you, and i will also ms. Rockefellerw ayne. She will tell us why she decided to make this move. Thank you. Stay with us, and other check of the Market Movers is on the other side of this break. Get the latest headlines at the top of the hour on bloomberg. Com. , bloomberg event does it for this edition of bottom line. On the markets is next. I will see you tomorrow. It is 56 minutes past the hour which means that Bloomberg Television is on the markets. Lets take a look at where stocks are trading, about an hour until the closing bell. Declines deepening to some extent. Leading declines. You have worries about the chinese economy, after the lack , as wellstimulus there as data here from the u. S. That showed the first decline in five. Tech was the hardest hit of the major industries. , why sector report this is not just been today, we have seen a recent days that the nasdaq has magnified the losses of the Broader Markets. Why is this going on . First of all it is important to understand that the nasdaq is only about 60 technology. When you look more closely at the technology or as we see it, which is in the s p 500, it has been pretty healthy. It has been outperforming this ofr, it is up through friday about 15 . That is a 10 increase in the s p 500. Noteworthy is that we have not seen that outperform the Broader Market since 2009. We have in seeing some week is eakness today because we see some whole valuation surrounding technology sector, and people see this as an opportunity to reset some holdings and see if we will see that correction that people have been waiting for. Do you think it will be sharper in tech . Do you think they will come down to pace the gains in the Broader Market . I think one of the things we have learned this year is there a couple of different pieces of technology sectors. One is this newer tech area where we see a lot of high visibility, high multiple, e names. A lot of the old tech names have not only performed well this year, but have also been hanging in there quite well today. If you pull are concerned about a old back or correction, we do get is likely that full to will gravitate to some of those names that they have grown familiar with over a decade. That fall squarely into that category. It also can fall into the hot category because there is deal speculation. Why do you like emc . The thesis is pretty simple. They are a leader and a strong secular growth category. They have a big and undervalued stake. Company is going to be pushed to take steps to realize more value. All right, scott, thank you so much. We appreciate it. Street smart is up next. Ok, everyone. Welcome to the most important segment. I am trish regan. Coming up today on street smart , Property Managers beat exclusively to bloomberg at the most influential summit. And we will hear from a founder class a growing list of investors are alleging to tackle Global Warming at the historic Climate Change summit. The rockefeller charitable
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