Up the c suite with ceo dan has he been replaced. Hessy being replaced. And Goldman Sachs and j. P. Morgan, according to regulate us, have not shown that they can collapse without causing Severe Damage to the economy. They are still too big to fail. And as i just mentioned, a morning of failed deals, both in telecom and media. Is someone who has had one of the most successful 10 years of any media company. Bob wright is the former chairman and cto of nbc universal. He is also the cofounder of his company. Make you for being with us. Is anything happening here . The last time you are on, there was lots of media news. You always find the perfect day to come on our show. Off, what do you make of Rupert Murdochs nondeal . Speaks forhat itself. He got out there with a very attractive offer, and offer i hope nobody would talk, top, which appears to be the case. Maybe they had some expectation it would move a bit and i felt like and maybe he felt like it was negatively affecting his stock. They would return to shareholders. Yes, but that may be over a certain time frame. In which case, the stock back, if they had to use it, it would certainly help their Balance Sheet for purposes of borrowing money. You dont give all of that money to shareholders from day one. That is true. Hang on, because i want to bring in jeff mccracken, a Bloomberg News reporter, who has been working on this story for us. The big question people were asking last night is whether murdoch was really done with time warner. But i dont think this is a ploy. I dont think this is a ploy. He is frustrated. In some respects, his reputation for being aggressive, which generally helps him when doing a deal, i think it worked against him. Because candidly, no one believed him or his advisors or anyone who worked for him when he said they would be fiscally disciplined and would not overspend. He shareholders expected would spend too much, which made the deal harder to do. And time warner shares kept going up and up, even though the message was fiscal discipline and we will not overpay. Not going to work for him. Rightnow when you look at the cold, hard numbers, it is hard to justify that to the shareholders. Some of the advisors to murdoch last night, there is some pretty strong ill will toward jeff bewkes and the board. I dont know if jeff bewkes will be able to get that stock price up. His job might be on the line. Hes very confident. Hes done a great job in breaking up the company and selling it piece by piece to begin with. Weve got to give him credit for that. The thing that strikes me is time warner is three different companies. Table theld turner table properties, which is cnn, cbs, and tnt. , which is ae is hbo completely different entity. And the third one is warner bros. Studios. Both television and films. Two of these three groups generally do not trade in dont trade a double judges multiples. We are talking about film and film does not trade at those levels. The question is, they are running almost a 20 multiple. He was at 85, maybe 90. Out there by yourself now, maintaining that multiple with those kinds of his mrs. , as good as they are. Businesses, as good as they are. I just think it is a very full bed. That stake will be there for a long time. Stay with me as you will be for the hour. This week, this morning, wall street went back to the drawing board and took immediate action to simplify their living wills. Without damaging the wider Financial System. Erik schatzker joins us now with more on the reassessment. I want you to play with this analogy. The Financial System is akin to an airplane. If the captain comes over the pa in an airplane and tells you we have got a serious problem, one of the engines went out, we have an electrical failure and it wont come down, what do you do as a passenger . You reach in and pull out the one pager that says what to do in the event of a an emergency. No, i will panic. 450 pages long. That is the problem with these living wills. Elizabeth warren pointed it out to janet yellen in the recent banking testimony. Isjpmorgans is living well four will is four pages long, how can this be wound down in an orderly fashion . That is the key. If a Financial System will be collapse, the next these things have to be able to fail. Be too big to fail. That is effectively what the fed is saying. Youre living will is your resolution plan. Do not dissuade me that you can be wound down in a orderly fashion. If you cant, that means the Financial System is still at risk. Ok. What are the banks going to do . The fed of the sec has ordered the best to go back to the drawing board and come back to regulators with a revised proposal by july 1, 2015. The big question is, how do they do that . The only conclusion you might be able to draw from this is that the fed is trying in it back your fashion to force these banks to break up or at least sell businesses. Was put in Pretty Simple terms. They made up their minds. Big institutions are a major risk and need to be split up. Some are pursuing explicit legislation. Others want to burn the big institutions so much that they simply cannot operate effectively. That is the subtext here. Thank you so much. Moving and shaking this hour, the aol ceo, Tim Armstrong armstrong. Figures easily Beat Estimates to a one percent drop in profit. He says he is open to partnerships and deals but one thing hes not interested in is acquiring a company to save money on taxes. It is not something i spend any time thinking about. Is, once you Start Talking about taxes, for a company like ours focused on a marketplace, our job has to be to focus on consumers and customers. Our business at our stage right now, the thing we are focused on is providing Great Services to consumers and customers. We will hear more from Tim Armstrong in just a few moments on what he thinks of Rupert Murdoch walking away from that bid for time warner. One company decided against moving its headquarters overseas , planning to buy for 15 15 billion. The company says it will not move its address abroad. Scarlet fu has the details. Scarlett, what happened here . Blame it on politics. Wall street came under a lot of political pressure. A democrat from illinois sending a letter to the wall street ceo informing him it would be a very bad moves in terms of optics to do just that. He said management would be turning our backs on the very people who allowed walgreens to thrive and prosper. That was one pressure point. Do not forget the u. S. Treasury yesterday said it is examining whether it has the authority to stop from moving overseas while it is waiting for congress to pass a tax reform. Walgreens dropping this idea of a tax aversion. What it does is and this twoyear journey of its alliance with alliance boost. Back in june of 2012, walgreens purchased 45 of the chain for just under 47 billion and then retained it for options of a full purchase. Todays announcement, it is purchasing 55 stake, just over 15 billion. Analysts expect a negative reaction in wall street shares. You are seeing that in the market already. Down 11 now. The most actively traded stock in the free market. If the aversion had been gone forward and approved, it would have given earnings per share a boost of . 64. Walgreens was just not confident the aversion move would have withstood an irs review. That is all playing out right now as investors reassessed where they want to see walgreen shares trading. Thank you. Banker to from homeless. The former pimco managing director tested for a week to see what it is like to be broke, all in his bid to win the governors race in california. He joins us in a moment. A republican is facing an uphill battle in his race for californias governor against a favored incumbent, jerry brown. The former Goldman Sachs and treasury decided to take his campaign on the streets, literally by going undercover as a homeless person to expose economic challenges in his state. He said in an oped following his stunt, californias most vulnerable citizens deserve leaders who will fight for them. It is a fight republicans should lead. He joins me now. Also here with us is bob wright, my guest host this hour. Neil, your critics said, what is the point . Why did you do this . Jerry brown calls it the california comeback. We are back and yet the data says 24 of californians live in poverty. Who is right . I went to fresno with 40 in my pocket, a backpack and a change of clothes, and i spent 70 days looking for a job. I said i would watch wash dishes. A few times, i was recognized, but none of the stores i applied. I could not get a job. For seven days come i lived homeless on the streets, i ran out of money, had to turn for a homeless shelter for food. 24 of californians live in poverty and we have one of the worst unemployment rates in the country, i think it rings file hollow. I wanted to bring poverty, homelessness, unemployment, to the forefront. Not just the unemployment debate but the national debate. We have done it. Admit, i admire what neil did and i admire his positions as i understand them. On a personal basis, but seeing what he has been saying, whos a moderate republican is perfectly willing to take on issues and take positions that other republicans more extreme dont. The tea party . It is just group spear there are so many people that are in extreme positions and he is not there. I think that is traffic where it i just hope the Republican Party in california is able to support him economically. They have not shown their ability to do that in recent years. That is true. Republicans are not known for really identifying with the lower middleclass or the povertystricken in this country. So neil, that is who you are trying to touch in your campaign . Ok. Let me put you on the spot. I expect nothing else. Your opponent, very cynical about this. They called it a political stunt. The San Francisco chronicle wrote, a former treasury 200 y, picked up a 20,000 donation while sleeping on the streets. He also scored a host of other big contributions from business leaders. They say this is just a fundraiser stunt. Jerry brown has 23 million in the bank and is taking money from high trade vendors. There is no room in this conversation for the democrats to criticize me over modest Campaign Funding we have been doing relative to brown. Neil, they say you are being a hypocrite. You are here talking about how it is hard to be homeless. Here you are banking all this money. Not me personally. We need money to have a campaign. Jerry brown thinks he is entitled to the governorship. He does not talk about poverty or unemployment. Do you know the california courts ruled california schools are violating the civil rights of poor minority kids, robbing them of their futures . Hasou know a jerry brown said about that . Not one word. He has not said anything . Not at all. Yes it he has a choice to appeal or not and he is hiding under his desk because the Teacher Union bosses own him. They funded campaigns and he does their bidding. I am fighting for working californians. He is living large in the shadow of his father. Bob, you are smiling here. It is just that i hope you families to understand your positions as it then theo them, and party can pull itself together. In the early 80s, when i was the president of cost communications, we were the largest cable operator by far, especially in san diego. That was republican country. There was no issue between republicans and immigration. In 1984 andnged 1985. The people to cold of the Republican Party and changed it forever. Tremendous voting strength. They have got harder and harder on immigration. It brings me to another point. We spoke with the chicago mayor. What ron said to us on immigration. The goal we had is to make sure every person in every neighborhood has the skills and education to participate and join the middleclass. That is our economic strategy. The children are part of that because of a get educated, there a newscaster, in that thousand. Someone who will achieve what we want. My bed is not just some of them, but many of them. Republicans say, send the children back. I am the son of immigrants, proimmigration. I think immigrants have tremendous value in our country. If you look at the ways of kids coming here, it is heartbreaking for them and for everyone. The only way we stopped the next wave and nextwave is we send the kids back home to send a message to the next wave of kids that you should not make this dangerous journey. How do you peel with hispanic voters with a stance like that . Sameesident obama has the stance. Hillary clinton has the same stance. They all say yes, we have to return these kids home. They approach kids with passion and respect and care. Hispanics i meet, they want their kids to get a good education, they want good jobs. That is where our current leadership in california is failing. To the issues i am focused on, they are not unique to any party or race. You can unite people and lift everyone up. Great to see you. Thank you for stopping by. Sorry we ran out of time. Republican candidate for the governor of california. Theng up, murdoch and collapse of the time warner deal. We will hear from someone whose company was once to named a partner in that deal. Armstrong from aol joins me in a moment here it moments. Moment. Good morning. I am betty liu. Here is a look at our top headlines this morning. Apple is the latest u. S. Tech company to be excluded from Chinese Government purchases. 10 apple products, including the ipad and the laptop, were left off a final procurement list. Concerned about security according to officials familiar with the matter. Wall Street Company taking over the Biggest Department street chain. Boosts not already owned. The new company to be named the , and notet alliance pursue the tax inversion strategy. An aversion to crisler may be at risk. A significant number of shareholders oppose the merger and exercised their exit right. Exceed 600 70 million, it made make the deal ineffective. The hour,inutes past which means Bloomberg Television is on the markets. We are about an hour away from opening bell. Futures again in decline. Number ofke any considerations to worry about and sell stocks, whether it is earnings with the job market in the u. S. And perhaps what is going on in the overseas and ukraine and elsewhere. Were are on the markets again in 30 minutes. We just mentioned this. The intraparty battle that has been waging inside the Republican Party in the 2014 election cycle. The winners all are are already emerging. So mattingly has been following this every step of the way. Bob wright is staying with me as well. Is there one single winner to come out of the struggle within the gop . Probably Republican Campaign consultants. So much money has been spent over the last 812 months. It has been incredible. Both byl amount spent the probusiness side of the fight and buy the tea party side, it ends up around 135 million. That is just for primary spirit we are not even talking about the general election. Businesses at 100 million. Were talking about the u. S. Chamber of commerce, and super pac flick american crossroads. Aboutrty groups put in 35 million. Freedom works, the conservatives fund, right now it is a split between the two sides. A great slate of candidates they are happy they pushed through. The tea party most importantly took out House Majority leader erik cantor. The key thing is republicans on both sides of the fight feel like theyre are bringing in their best general election candidates they have had in mold election cycles. Are democrats dancing in the streets because of this . Are thrilled to see any dollar go into a republican on republican fight, let alone 135 million. If you look at what has happened , the map has really started to expand. Seats the democrats did not think they had to defend, anding about michigan oregon, good republican challengers and republican money, they might be thrilled republicans have been going after one another, but they have major problems going into november. Stay with me. Bob, you are a republican. You are trying to get through in congress. How do you feel about this infighting . The difficulty were having more the senate. You can have bills and i will talk about couples i am involved with. Bills have tremendous support across the aisle. If you cannot get the bill to vote on the floor, if the leader will not let the bill get down, it could get submerged. A lot of this is about the process of legislation, getting it on the floor so the voter can take place. It is much tougher in the senate than in the house. Even if the republicans had 60, 59 senators, they will be in the same position democrats are now. Cannot get their will that get better if the gop takes control of the senate . They might. It is not a given because of the nature of the rules of the senate. They will be able to get bills to the floor better but they still have the issue of procedural delays. The houses different pair the house is different. Billpeaker can stop the from going to the floor. The house is representative of population. You are getting a clean vote in the senate. You have a substantial bloc of people that only represent less than 20 of the population. But they dominate the dialogue. Stay with me. Mattingly, our white house correspondent. Thank you for bringing us that story. The big political headline from london this morning is from a london mayor. In an event at bloomberg headquarters, he announced he will run for parliament, ending speculation about his political ambitions. Guy johnson spoke to him today. Him up as aet successor to David Cameron as leader of the conservative party. That is certainly what Boris Johnson would like. Politicalall about ambition for him. He came here to talk extensively in or out of the european union. He then dropped the bombshell, he will be running in next years general election. He will be back in parliament. He could be the successor to David Cameron. What he also had to do today was positioned himself in the skeptic wing of the