One company will focus on hardware and services and the other are personal it is and printers. The wild weekend. The Virtual Currency plunges to its lowest level in a year. What is behind the fall. A professor who says an elite education is not worth the cost and those goals are creating a generation of religion career zombies. There is one sitting next to me this morning, olivia sterns, and erin wegraduate have a great love show graduate. We have a great show tonight. Bitcoin is follow falling on its own. Time for the newsfeed. The top is stories from around the world. Hotel, andelling a the buyer is a Chinese Insurance Company paying almost 2 billion. Hilton says it will use the money to buy other assets. Agoon bought it 42 years and will continue to manage it and the hotel will undergo a major renovation. A new report underscores the risk of a slowdown in the worlds is largest economy. On especially fell the most since 2009. German Economy Ministry blames the geopolitical risk and a slowing economy. Speaking of bitcoin, gold is up slightly after hitting its lowest place this year. It fell before rebounding. Dollars are getting stronger. Firsts heading for its backtoback loss since last year, the most in three decades. Thehe vague story of morning, hewlettpackard is breaking up. One company will focus on products and services for corporations. Hewlettpackard enterprises, the part that the ceo will continue to run. She will also stay on as chair of the printers. Joining me now is cory johnson come outside the companys headquarters. Good morning, cory. Thank you for joining us. Forecessor has been calling this for years. Let it take womens so long for this to come around . Interesting. Make suggested this could be a possibility someday. At the same time, saying she was not going to do it. Worrying one of the reasons she got the job was that she screwed up the job so poorly by announcing it before we had somebody ready to buy the company. It is a reflection of the markets here. Hewlettpackard has been here for decades. The spinoff of 1999 is forgotten. That was supposed to be the change in hewlettpackard was going to secure the future, focusing on the pc and the printer. Now make his announcing there really is no other idea for the company. They are not able to do buybacks in the Conference Call they have this morning. So they could not do any buybacks and would continue to be unable for the rest of the year. They face a big pile of debt with all of these acquisitions, they have spent tens of billions of dollars in acquisitions over the last 15 years or so. Revenues barely budged in the last few years, trying to find a way to gussy up the company into because no one else is willing to buy that pc division. Poorly executed. They lost a billion dollars on that one. You want to talk about autonomy. Forget autonomy. Contact at 25 billion. Companies like snap fish, threepart, Electronic Data Systems for 13 billion. They have acquired Companies Like tracy and yet we have not seen Topline Revenue growth yet let alone it is always to come it always next year. They announced a 600 Million DollarRestructuring Program today. In other 5000 people will lose their jobs. There will be more opportunity for more layoffs here. It is a sad day for the workers who have made the company. Not for shareholders. The stock has kicked absolute but not only this year but last year as well. Love with ac. Today is no different. Promises keep coming and investors keeping the stock up. The results are what the results are and it has not been very good for the company, whether it is topline or bottom line. Theyve reshuffled the debt as well on pushing the got up. Cory johnson, thank you for joining us. Our bloomberg west editoratlarge. For more on what the breakup thes for hp, lets talk to president of Market ResearchFirm Creative strategies, a. Onsultant for hewlettpackard he joins us from california via skype. Let me ask you first about this strategy. It seems like the decision could have been taken much earlier with an earlier ceo. Digg meg whitman take too long with this idea . She had a huge task to turn things around after leo left. The company needed to be stabilized. That stabilization has somewhat taken place. As she said in her call and the material this morning, there was a lot of work that had to be done to lay groundwork for Something Like this. A bigger question i got when you look at Something Like this is, will it work . The division is obviously still strong. There is still great demand for building on a next generation enterprise. The printer side of the business and the pc side of the business, that is where growth has slowed. Sticking it out does not necessarily mean it will be successful by itself. It needs significant investment and a tremendous, strong strategy. Their competition right now has gotten stronger, especially with what lenovo and dell has been doing since they have gone private. It creates, i think, a lot of interesting new challenges. The other thing that is interesting is potentially, it sets the company up for maybe this merger at the enterprise level and potentially, maybe some of the other pc companies who actually want to own a greater piece of this, maybe now more interested in the pc division. I do not know. Survivede pc business by itself . Does it have to grow or is there a way to get rid of that after the spinoff . It can growly in the sense that he sees are not going away and there is demand. A lot depends on what the roadmap is. What other products to they have in the pipeline . In that context hold on a second, sorry. Context, what you have got is a solid base to build on. Again, printer sales and pc sales stabilize and are not growing as fast as they have in the past. That is a challenge. Ibm put up their business in 2005. They sold from tuna lenovo. Are they putting the business on the block . That is not the intention at the moment. If someone came in and offered them a significant sum, i suppose they might do so. It sounds like at the strategic level at the moment, that is not the case. They really want to see who will be the new ceo of the pc division who came from a nobel and is a verys smart guy, can actually not only keep the Company Growing in its own right, but growing it. Enormouss obviously an company, north of 300,000 employees despite all the layoff meg whitman has seen over the past two years there. Of the new think Leadership Structure . Does it make sense for women to maintain the role as ceo at the New Enterprise this is that also saying on a chair . A very good question and i was wondering the same thing. Is the point of splitting up the company to give these managers time to look at each business separately so they do not have as full a schedule . Liked myappy you question. I was wondering the same thing. Yes and no. It is still an hp company. She still has a chairmans role. In the context of guidance, she is not an executive of the pc company. That is a legitimate role to play. The bigger question is how she drives what goes on with the enterprise. That will be a real daytime job. Time will tell. At least in this transition time, it makes sense. That, they will have to give great assurances. When are the next elections for the governor of california . A lot of people are questioning whether or not it makes sense here it she will have to spend some time as chairman of the pc business and that time is what to focus oneeds enterprise business. The chair of the pc and printer legacy business. Go ahead. Again, she is a nonexecutive. That is more of an oversight position. I think he is so good, and he it around him, i think they will be able to solidify the business by themselves. Thank you so much for joining us. Creative of strategies, he has consulted hewlettpackard. Coming up on Market Makers, a story matt miller got out of bed for. Are talking about a surprise in brazils president ial election. Brazil has his business candidate has made it into the runoff. And bitcoin bounces back, the Virtual Currency rebounded today after his biggest all in almost a year. Just fall in almost a year. Stay with us. Investors are cheering results election results. It would be the best performance for index since 2008. A second place finish. He will face off now with the incumbent in a runoff later this month. Us. He ground for us, tell who is this guy . Why do investors like him . He is one of those people who talk about the idea of things like centralbank autonomy. He says he will get inflation under control. Tosays he will bring it down 4. 5 , more in line with what the Administration Currently says it should be aiming for. Those are the kinds of things investors seem to be happy about. Sawry lastminute surge he to get to 34 yesterday. Polls thatago, i saw said it had a doubledigit lead and then here comes out of nowhere, second place. Yes. I was looking at some charts today. Fascinating, showing how low his support was, his probability of winning the election. One thing to bear in mind is late august, when she died in a plane crash, she saw a huge surge. She was experienced as she flipflopped. Number two is also on the attack until last week or so. That may reflect a desire to win her voters over in the next election later this month area what is next . When is the next round . The 2010 election and she came in third with a similar portion of the vote, 20 . Four years ago, she decided not to back one of the other candidates. Whether she will or not is an interesting question. A lot of proposals she put forward, the other candidate said there were very similar proposals to it he made. They may feel they could win over some of the supporters and help repel him toward victory in late october. How is the economy faring under the rule there . Been a pretty shocking result in terms of stock crisis. In terms of the lowerclass, they have seen 36 Million People pull out of poverty over the last 10 years for the last question he is and especially running around 4 annually, now much lower down around zero and to the negative numbers in the Second Quarter of this year. We will leave it there. Thank you. Ben bernanke, he has spent years defending the aig bailout. Necessary to save the financial system. Chief washington correspondent peter cook has more on the case. Take the stand this morning . Were has taken . Yes. He has taken a stand. It has been interesting to see him live relive the financial crisis one more time. You can see the anguish back in his face as he remembers all the choices, including among those bad choices was the decision to bailout aig. Getting into a just as i was leaving the courtroom some of the details there. You can see him arrive earlier this morning in the white house. The famous litigator, what he has been doing so far is get paulson to showcase the fact that others see financials at the time. Trying to engage hank paulson with the notion there may be other options out there. To chinese were prepared invest in aig and hank has been challenging that notion, saying it was not a real offer from the chinese. Hankwonder what greenbergs presence has been like . He is the impetus for this question mark for this . He was not when i was in there a short time ago. E was last week we do expect at some point during the trial. All ofhe focal point in this. Hank paulson was asked about the relationship with Hank Greenberg and said he had a very high regard for him. He asked why he did not take Hank Greenbergs call at that time because it was Hank Greenberg arguing he was trying to relate information about china wanting to invest in aig again. A possibility of another option. Hank paulson made it clear he is not seeing other options. Thank you very much. I am jealous he gets this courtside seat. Follow be incredible to and we will continue to have peter on to talk about it. Thank you so much. By the way, we launch our brandnew political show tonight. , you very first guest might remember him, he ran for president. His name is mitt romney. We have exclusive reporting about jeb bush. We said hes not running. I am almost more excited here, john and mark talked about politicsnpolitical with mitt romney. Talk to him about other and more fun stuff here it is looks like a great show. Including whether or not he will back jeb bush, not running. That is more the political stuff buried i am looking forward to, for example, his car collection. Coming up, man versus machine. Will a problem for equities. Is it coming to the bond market as well . Stay with us. It is time for bloomberg on the markets. If you take a look here, you will see at least a couple of the indexes gaining right now. The nasdaq is down. The industrial average is up as we see a slew of corporate deals. Two weeks of declines on the s p, still only up three points and the dow up 40. Will we see triple digit swings again this week . Presley got a nice bump in equities overseas. Hong kong trading higher after it was like roughly restored to the streets. A rollover in commodities. Look at the gold trading below 1200. Trading below 1200. West texas trading below as well. Slowing growth coming out of china, and in particular, we have got a very excited matt miller because platinum prices are going down. They will be cheaper. That is right. We continue with combustion engines and we talked to coins bumpy ride. The currency following the most in almost a year before bouncing back this morning. Live from bloomberg headquarters in new york, this is Market Makers. Welcome. I am matt miller. Bitcoin took a dive over the weekend. The price fell over 20 yesterday. Thisin bounced back morning, but still near 2013 lows. Many people are wondering what is going on. Why the incredible crash . Lets bring in a Technology InsideBitcoin Conference in las vegas. I imagine everyone there is a , gossipwith excitement about what is going on behind the crash. What are they saying . The day. S the talk of most of the discussion is about some of the shorterterm drivers and the fact that the Network Knows to support the bitcoin infrastructure, the one referred to as miners, the escalation and have beensing speeds so pronounced, they have to sell more of their bitcoin to cover those costs. That puts downward pressure. There is also good reason that the price is going down. More people use it for paying website. A transport of u. S. Dollars for retailers. Additional supply coming onto the market. Those things are driving the price down right now. It could very well continue for a while. Eventually, as consumers use up their bitcoin, they will start replenishing and there will be a rationalization of the miners, some capacity will go out, remaining miners will be more sufficient. So are you optimistic . Investor. Bring in an bill gates last week was talking to Erik Schatzker about bitcoin. Bitcoin is exciting because it shows how cheap it could be. Bitcoin is better than currency in that you do not have to meet physically in the same place and for large transactions, currency can get inconvenient. Am i the only one who heard that last week . I was impressed a guy with 85 lien dollars is out there preaching the virtues of bitcoin and we still see this incredible crash. Keep point to what is really important and that is technology and what it does. Technology will make it possible to do 12 . Nearly zero,ts at and then there is farreaching complications. One in the latest line of technologist that believe in it coin. A short little to do term. Just believing in technology, the price will follow. In the short term, convert it could be worth 1000. That is just the base of transactions happening today. Longerterm, it is applications of technology that matter. Tried to convince me bitcoin is selling off because the dollar is getting stronger. That is one of the reasons. That is no longer expanding its balance sheet. The u. S. Economy is relatively stable. The dollar is getting stronger. There is no reason to run for the hills. That is all true. Does that issue put any pressure on bitcoin . Lot of othera additional factors, concerns about the health and wellbeing. F the u. S. Economy that could lead some people to sell. Sure. Having other highgrowth assets like alibaba probably lead some people to sell. Factors and at of lot of these factors are shortterm. Price fluctuations will be great. I do not think that will change. Is more important is Venture Capital and Software Engineers continue to invest their time and money in these technologies, and we will see great results. I wonder about regulation and how much that is suffocating the utility of bitcoin. Some of the officials in the state of new york seem to be stuck in the 19th century. But there has not been regulation yet. I wonder about the possibility of etf trading. Breathwaiting with david to see when the etf will be approved and then start trading. Do you think that kind of thing is important . Surely the liquidity will help us far as adoption. Yes. Absolutely. Make accessible in a direct Way Investors and Retail Investors and to the extent it does pass and they approve it, it will have a very positive impact. Regulation is limiting the ability of companies to grow. Regulation right now is a limiting factor. Even more so, the draft for the regulation for the license in new york is scaring a lot of people. Some of the requirements there are so onerous that a lot of people who would otherwise start or expand a company are hesitating to do that. Time theytant by the are finalized, they get scaled back to reasonable levels. Otherwise, that will scare activity out of new york state and possibly out of the u. S. What about the issue of cyberattacks . There have been three breaches at target and home depot. Cases earlier this year were people literally had bitcoin stolen as it just vanished from their online accounts. To what extent do you think that is spooking investors . And mount docs. Gox. What happened . They could have been selling anything el