Inflation is going up. Expect a Quick Movement from the stopand the old plan to the reinvestment of materials is off of the table. Willare worried everyone overreact as if they wrote rate increase was imminent. They are just going to raise rates. Debate,e is a bit of a but the interest on excess reserves they will just leave the excess cash at the fed. They will taken cash from dealers, in exchange for lending securities from their portfolio, and keep them in trade. This is still a possibility. Thatare just going to let four dollars trillion 4 trillion rolloff. This is just one man, even though he is very influential. See when those fed minutes are released with further discussions they will have. Howelocity is the terms of fast you want to raise your rates, what are you hearing about that . Slower and lower than in the past. Slower,s going to be inflation is going to be lower and with the new regulations, you will need to raise rates as much. Rate,n keep the benchmark which is well below to be below the average level, it was around two percent. Speaking of the fed you will have janet yellen. They will get some extra help today. We have confirmation of Stanley Fischer to be the feds vicechairman. If they didnt do it today, theyll be going on vacation in the fed will have three members, less than before. The stupidity question continues because no votes are being planned for the other nominees. We just hope that they can get it done before the next fed meeting. They continue to discuss an exit strategy. Michael mckee, we will be keeping up with you throughout the morning. We you have earnings breaking right now, coming in at . 50 per share, lets go right to julie hyman with the latest. Mentioned ise you a 15 rock, and they are also cutting their earningspershare for the year and the second forward, and going target still remains quite cautious. Part of this still has to do with the data breach in which many of the customers had their information compromised and the company is now saying theyre unable to estimate future expenses related to the data breach in the First Quarter. Critical payments associated with the potential claims by the network for counterfeit and fraud losses. They are still trying to get their arms around this thing. But they continue to struggle. Recently, bloomberg did a poll on customers and said that the majority of them said that they were not going to change their shopping habits, and if you look at the comparable sales numbers, this is actually the bright spot in a report, it fell 3 10 of one percent but analysts were looking for a drop of 1. 1 . The profitke shortfall has more to do with expansions and markdowns that the company also said in their statement today, but actually in that is the stores not as bad as some were expecting. Thank you very much. We will have more on target throughout the hour. Netflix Ceo Reed Hastings launched the companys biggest expansion in almost three years. Online Video Service into germany and france this year, and he wants netflix to establish global dominance for the amazon prime instant video and three quarters of their customers are in the u. S. They are hoping to sign up almost one million customers overseas. At t plans to buy directv for nearly 49 million. The deal hinges on football. The nfl sunday ticket package ends this year. At t will call off the merger if this is not renewed. Christina, you and i might not watch a lot of football, but lets get this in perspective, how important is this deal . It is very important. There are 2 million subscribers, paying anywhere from 240 to 330 a piece for the service that lets you watch out of market games on sunday. What this means for the top line is the revenue generated is around 660 million based on the numbers that we have. But they do not officially break those numbers out. Because powerful consumers are willing to spend 1000 to get their football. Is, whyuestion really did they not just wait until the deal was done . Not only this, but leverage is actually on the side of the nfl now, because they can say, we can charge whatever we want, you need us to get the deal done. This was a bit of a head scratcher. But direct has been going for months they had talks with the nfl, moving forward at a pace that is positive, and we saw the nfl commissioner say the same thing. It seems like the expiration is at the end of the year, the nfl and directv are in talks moving forward, this does give them a lot of leverage. Leverage they dont really need at this point. I wonder what kind of similar deals we can look at, how much more directv will have to pay to renew. In 2000 levin it was interesting, there were networks are renegotiated their rates with the nfl, and this led to increases of 5060, even 70 in some cases. This could be a bigger number because there are so many other networks, that would like to have this package. The nfl has argued that they could go to google, and verizon had a product they offer on mobile for some nfl content. There is plenty of competition for this. Although we see those historic deals coming up at 60 or 70 we can even see a bigger number. Unbelievable. It is all about sports. Cristina alesci, thank you so much. They had two options for customers, you could pay 10 per month for a limited content, or get the service for free and see advertisements pop up. Spotify will announce that they have signed the 10th million and you canber, read that article online, right now. John. Re im joined by 10 million subscribers is a lot. But they dont benefit in the way that we think that they will. People are paying and they are making more money. They are sort of on the hamster wheel where you think that you are company and the more subscribers that you had that are paying to watch that content, the bigger your margins will get. But the way that royalties work is the more subscribers they get the more they actually have to pay in content costs, about 70 in royalties. And the contract is structured so that this doubles they double as well to keep that 70 . Because of that they have about 200 million songs since they were founded, you could see apple coming by down the road and they have a lot of deep pockets. What does this mean for spotify . It has not been confirmed and we are not absolutely sure what brokeed, but when that there was a certain perception that maybe it is better that if you are streaming, you are sort of off for a company that makes money other ways. They would be willing to lose the money and spotify eventually it turns out they will not. Spotify will buy this . They will absolutely not. The last time they raise money was last november which would make them expensive. They will be able to stand on their own but that is a lot of growing. They have sort of partnered those worsts one of carriers, they have parted with at t and verizon. Is this going to be a deal for them . A deal andhas made sprint was the deal they wanted to make, they have a discounted spotify subscription and hopefully that will drive the number of subscribers higher. Have been would better to do a deal with verizon. Sprint really needed music and never making a push and they and sawing a push, streaming music as a way to build their strategy. What is the growth strategy, to keep getting subscribers . What is the endgame . They are looking outside the United States. They are trying to grow other markets. A 30 cuttually have in revenue that they work with, so presumably if they get enough customers, they will turn a profit but that seems far off. Is a bigger overseas than in the u. S. . Spotify is easily the leader in every market for streaming, and or is a really big player as well on the radio, but if you look at the monthly subscriptions spotify is in a class of its own. Will solvency ever be an option for spotify . Option for them, they cant get that market overseas. The worstcase scenario is you have to find a way out with an acquisition or somewhere down the road, they would have to think about that. But they are very well capitalized. Thank you so much, we appreciate it. You can go online to read the entire story, this is a great read online right now. Still ahead, luxury on wheels. On hollywoodsde alist. Inter drink up right now but the future there may be a shortage of good whiskey. Stay with us, we are in the loop on this wednesday morning. Target is struggling to rebound from the hack attack and posted firstquarter analyst estimates and forecasts, and a bloomberg poll shows that shoppers are not scared to swipe their credit cards at the store, so what other issues are actually weighing on this company . Julie hyman jointly with the covers and also, dash the credit card industry for bloomberg news. Lets look at the numbers first. You have a disconnect between the sales and the profit numbers. ,ales in the First Quarter fell but this is not as bad as analysts had feared. And the First Quarter was a tough quarter for everyone. This is not uncommon but profit missed estimates, in the First Quarter and target is also coming out with a secondquarter forecast that is below estimates and cutting the fullyear forecast. This does seem to deal at least partly with repercussions of the data breach, and the company said in a statement they cannot estimatefer an exact of exactly how much is going to cost in the end. When you talk to analysts, do they think that the data breach is behind this . It is on top of so many other issues and when the ceo said he was leaving most of the people i spoke to said it is not about the reach. This is just the straw that broke the camels back. If you look at the list, yes, the data breach. Thehe Canadian Division and head of that division that took lace yesterday. The lack of freshness is something a lot of analysts talk about. This is not what customers are looking for and it also ties into the commerce game. And even though both have about the same percentage of their overall sales coming online, target is behind the game in terms of how things look and offering instore pickups, waited to do that with walmart and other competitors and they have to get that new, permanent ceo. Your expertise as well with target, migrating to chips this is something that they use a lot, in terms of credit cards. Can target accelerate in the u. S. . That is often used is a wakeup call. To upgrade card security to make the transition to chip technology. The reason the u. S. Has been slow to adapt to technology is cost. It has been slow for the banks and retailers with interesting technology, this is a huge task and there has not been a Business Case for going through that transition and now there is. They are looking at target and the fallout, with a reputation challenge for the company and what is the impact they have on management, saying i dont want to be the next target. Tell us how this actually works, how much they have to upgrade and how much this costs. At the end of the day, who is responsible . The cost estimates that we have seen, the cost for hardware for the new cards and the it would be the retailers, this has been estimated to be about 1011,000,000,000 dollars. This does not include software costs. But then you look at how target has costs of about half 1 billion. That is how big of a cost it is for the bank. Talking to analysts, they talk about the upgrade. Do we see that in the short term . I had not heard analysts talk about this as an essential problem. If i could ask the question when you get the cards with new technology, do you still have to have your old cards . How is this going to work . The bank will be reissuing the new cards with new technology. The chip is the central component but there is a new verification measure. There is a signature that customers are used to, where they pay something and sign their name, the other thing is interesting that entering the pin number. You can use the additional layer of security if your card is stolen. When they reissue the card, not every point of sale is going to have upgraded their system. Work,l this card still not an target but in walmart or something . That is why this is so complicated. This is such a huge undertaking. This is across the system and right now you hear about the deadlines and the reliability of the network, they have put this in place and october of next r, if you are the retailer where the issue does not have the technology, there is still a lot to do. Thank you so much, elizabeth. I really appreciate that. We will be back in just a few minutes. Good morning. You are watching in the loop. I am trish regan, and for betty liu. Here are the top headlines. Firstquarter profits topped analyst estimates. And the second largest u. S. Home retailer reported a 2. 4 rise in Quarterly Sales after the harsh winter weather. Fullyear earnings have exceeded estimates and the new ceo outlined his vision for the company. Them as abeen with chief executive since 2009. He took the helm this month, replacing who went to join apple. New york rangers fans will have to pay up to see their fan play team play the Montreal Canadiens tomorrow night. 601, aare as high as 15 increase from the start of the series. The rangers are just a few wins away just two wins away from a spot in the stanley cup finals. Lets take a quick look at futures. Futures are a bit kinder at higher after equities fell yesterday. The fed minutes will come out at 2 p. M. New york time today, we will be watching the market for be on the will markets again in 30 minutes. One stock we are watching this morning is bnp paribas, frances largest bank is being investigated for breaking u. S. Sanctions against doing business with iran and the sudan. U. S. Authorities are seeking nearly 5 billion and a guilty plea from bnp. Joining moore is terror joining me with more is terri geiger. This is one day after Credit Suisse pled guilty to tax evasion, they agreed to pay a 2. 3 billion fine, and this is the first time we have seen any criminal charges against the bank. Does this mean more sanctions . It could be the same for other banks and what is interesting about this, is that the superintendent of the new york banks the top ranking cop in new york state, he feels a little bit differently and has signaled in the past he wants to name individuals in this case, which is something that people you and i have talked to over the last several weeks you had this criminal indictment and the guilty plea, and yet nobody is actually personally coming. I dont know if we will see prosecutions for individuals in this case, we will see people named and shamed, that is a possibility but the other interesting thing is they may restrict bnp paribas from doing certain things in the u. S. For a set amount of time. Did not do that with Credit Suisse. That may cut into their revenue a little bit, maybe not nearly as much as the 5 billion fine, you wonder how political that this will get. John mccain came out and issued a statement basically criticizing the government for not going after these individuals. He said, how can you have this guilty plea and not one person is being faulted for. And now the government is trying to change that . I dont think we expect individual prosecutions on this case, not to the extent that the American Public wants to see this. They may not have a case for this. They could come out after but that is where the criticism comes from. They are criticized heavily for allowing the banks to be too big to fail. And now they deal with the banks that essentially seem to not not even a firm that they are too big to fail . They dont have their licenses and things like that, and they are not going far enough with these banks. Where do you draw the line . On the one hand, there are penalties involved and on the other hand, all this regulation is only going to wind up making an industry that is incredibly focused on this country, smaller. I wonder what the other banks are looking at and thinking about the United States . It is hard to be a Global International bank and not do business in the u. S. But you do think, how do i fit into this regulatory environment. You also might say, how do i better my compliance, and make better standards and protocols so we dont get into trouble like we see here at bnp paribas and Credit Suisse. There is some uncertainty because of they go after one bank, your than other find yourself saying, where am i in this process. Go back to 2008, bear stearns not saving lehman brothers. Thank you so much. Ill be talking with you, maybe at 3 00 on street smart. Perception a public change, burger king is trapping have it your way for the your way, and mcdonalds has a new creature and to get people to to get kids to eat more healthy food. For more on the rebranding, i am theby our editor chief marking officer at kodak. Mcdonalds is getting a lot of negative attention and feedback from social media. Is this too soon to call it a failure . It will take a while and mcdonalds is a big company. What is going on in the u. S. And other parts of the world, they like this. I cant think of a character as scary as the burger king king. He was scary. He was creepy, quite frankly. The intention is good because they want to get kids to eat less fries and more carrots. You go to mcdonalds because you go to mcdonalds. You arent going there for health food. No matter how many times you try to put a white brush on this, this is still the same color. That is what you are going for. That is the way that it is supposed to be. Aat is a good thing about brand problem burger king is trying to change that. This is called happy. Not a meal, you just want a happy. A lot of the kids who go they have some research and those kids are going there for the toy, and so whatever you put in that does not make a difference to them. Being that safer meal makes the parents feel better. The new slogan for burger king, be your way. A good model, be yourself, be your way. That is good, they have set them selves apart from mcdonalds. They say, have it your way and if you want a hamburger for breakfast, they will give it to you. I personally like the original chicken sandwich and i will go for that. We are talking about the fast food image, this is seen as bad for you. Mcdonalds,ing and there are plenty of salads on the menu, you can eat healthy if you want to, do they need to rebrand themselves at all . S mode take themselves there. A lot of parents will take their kids there. 56 of the business at mcdonalds is try but, because it is fast and if you want to get those carrot sticks or apple slices, do that, but no matter how many incentives we have where we tax them or ask them to do it, people want to get where they want to get what they want to get. It is very hard. You can encourage and educate people, but at the end of the day if they want fries theyll be able