Before we get to the vault and if you did not know, young eric had a birthday over the weekend. Happy birthday. The wrong side of 40, folks. That is just the way it is. Cannot do anything about it. Cannot do anything about the news either. The top stories of the morning. News forecast from Goldman Sachs. It will not curtail shale drilling at least not until it falls to 40 per barrel. Goldman sachs cut the forecast for the west texas intermediate rate benchmark to 39. Prices fell more than 4 today. Now below 47 per beryl. The biggest acquisition yet for a shyer for shire. This gives them treatment for rare diseases. They have been trying to boost growth since a proposed 52 billion sale collapsed last year. Genetic testing partnering with the biggest drugmaker in the united states. Sharing dna data at 350 thousand people with pfizer. The data will allow new targets to treat dizziness and diseases and design clinical trials. Maybe the end of the road for peyton manning. Struggling as denver loss in the nfl playoffs. Manning says he is disappointed and does not yet know if he will return for an 18th season. He does have the papa johns pizza if it does not work out for him. Cyber security will be on top of the agenda in washington this week. President obama will spend the next four days promoting ideas to protect online privacy. He wants to prevent half hack attacks like target and home depot to name just a few. He is in the seat. What is this all about . Kind of never let a crisis or crises go to waste and the view from the white house right now. What they have been trying to do since they have been in office get congress, private industry and the federal government behind a comprehensive set of roles on how to counter cyberattacks and have not been able to do it. What they are trying to do is use what we have seen with jpmorgan, sony and targets as a way to jump off and add new momentum to the plan. They will start off by announcing a legislative proposal that any private company will have to inform their consumers within 30 days if there is a major hacked taking some of their private information. I think the most important thing by wednesday of this week they will lay out some type of proposal talking about information sharing. That is the big issue in terms of trying to combat the cyberattacks. The white house is going to make a big presentation lots of ideas. How real are they . What are the actual action steps . This is something everyone agrees on. The fbi put on a classified demonstration inside congress for all lawmakers are they basically did the worstcase scenario. Members were walking up action based. They were terrified what it would mean. I think what the president is hoping with a push right now is legislative proposal has gotten the floor action just not the final area of agreement that this push could help. Not just demonstration stuff. The idea of being hacked over the past couple of months is a can pressure lawmakers. That is what theyre trying to jump on throughout the week. Can we go back to the substance of the proposal that atmosphere surrounding it is important but does not address another problem, which is in many cases companies do not know they have been hacked and cannot inform anybody. As you well know a criticism levied is they are not working closely enough together. Anything the president is going to say today or over the course of the week to address that . This is going to be the focus wednesday. The big issue and where stephanies point is actual details of the proposal, the frustrating part is no one can figure out the specifics of how information sharing between the private sector and government would work. The private sector on stomachs or they are exempt from liability. The white house very concerned about privacy and things of that nature. What the president says wednesday is important on that. Will they set a marker down for what they need to see in a legislative proposal Going Forward . The white house has taken executive action, talked and worked on capitol hill but reluctant to weigh in heavily on legislation. The lack of details is frustrating. The detail is whether or not the president will get behind one of them and throw the weight behind it and go forward. That is the issue i am interested in seeing what happens with that wednesday. Lex i know you are also interested everything that will be covered in the state of the union address. What else will he cover . Last week he made three stops in michigan and arizona and tennessee. They are calling them sneak peeks of the state of the union. Very rarely does the white house talk about this early what they will unveil he will lay out executive action he can take. You will see some stuff on education, what he can do on the economy and then the display to proposals. Friday we saw the Big Community college initiative. I think on cyber there will be issues to. I think he will say things are good but we can get better. Usually president s wait until after the speech. This year doing it before. Giving us the latest out of washington, i think we have a little more time sorry, all out of time. When we return going live to the Detroit Auto Show. Matt miller will be here with the Top Executive of north america to tell us how gas prices are changing his strategy. Dialin island vacation spot where crowds are never a problem. Plus the island vacation spot where crowds are never problem. Lex this is market makers. Sap shares suspended from trading and the company came out with headquarters think the Fourth Quarter software matching estimates and the Company Based in germany does not report earnings until january 20, a little bit of a financial update. What is interesting is oracle shares dropped lower following the suspension of sap shares and have since paired the losses following the latest losses. As for the overall market looking for declines of. 9 for the s p 500. We are continuing to keep an eye on the weakness in equities extending after the selloff. Like thank you very much. Talk about what is happening in detroit. Automakers flexing mode muscles and the motor city. A year of booming sales. Toward the end, plunging oil prices so it should not surprise you auto bookmakers have automakers have new hardware to show off. Who should be there but our own matt miller . I want you to share with us some of the highlights thus far from the auto show. What are the major trends emerging . For me the exciting thing is it is not so much about hybrids or Autonomous Car or cut conductivity, it is all about cars. Or conductivity. It is all about cars. The horsepower. Sorry . Who cares about the future and technology, lets go tough that asked bad ass trucks right . With dollar with one dollar 77 gas, it seems like that is what it should be about. A lot of they suvs. It is a huge car. I am a bit of a caveman. I did excited about that stuff. There are a lot of hybrids lightweight technologies important here. I think that is the name of the game disguising these big, strong powerful cars or selling them as powerful cars and the consumer almost does not even realize and right now the consumer probably does not care about. It is really all about where the consumer is putting the accent because it is not as if someone could design and manufacture prototype of a big suv in six months. This has been years in the making. That is for sure. All of the automakers are really paying attention to mpg. To them it does that matter if the price of gas goes down, they know it will come back up. That may bring in jim wentz to the discussion. Consumers have a shortterm memory but you have to Pay Attention to the bottom line as far as mpg all the time. The bottom line, you have to offer broad portfolio. The drop in fuel prices has just been in the past few months. When we were planning what to show and display, none of us knew her that was going to be. It just happened to be a lot of people bringing up performance cars and trucks. It is difficult to say, only time the price of fuel only going up. You have a consumer looking at a new tacoma excited about buying the truck, they see truck and feel like they can do it because the price of gas is low, although it is a fairly fuelefficient vehicle. What is interesting is whether it is a fullsize truck or midsize truck fire, fullsize truck fuel efficiency is about number 20 on the buyin priority. A little bit higher on midsized whatnot the key driver. This will have much better eat mpg. Midsize trucks are so hot right now. How does that happen . A really heated combat zone for the automakers, especially the big four. Tough to say what the others were thinking. We have been in the business never got out of the business. A 60 share today of the truck. This is the ninth generation. By far the best generation. I have been asking a lot of guys today about the euro and in your case the yen. The first thing that comes to mind when i think about toyota or some of the german automakers coming to the u. S. That you have tens of thousands here. Does it affect you at all . Obviously a little bit of the tailwind, it but when you build over 70 in north america, 75 part, it does not have that much of an impact. And you look at the yen it has weakened. The dollar has strengthened. I would not say one is weak one is strong. Prelehman brothers the yen was around 1. 20 and no one was talking about how weak it was. What is your manufacturing plant looking like . A lot of manufacturers new to the game from overseas getting into production over here. Tell you the producing toyota producing arrear for decades and decades. We are exporting to over 40 different countries. Just about every model made in the u. S. Is now x ported somewhere else. Obviously the Production Capacity is right around 2 million. As we see the market continuing to improve long term, we have to make new with to make decisions about whether to we bring in more products from around the world or expand in north america. Volkswagen that in her heels in terms of total production numbers. Seems to be very important to them. How important to you to maintain the crown of the worlds biggest car producer . It is not. It is a benchmark i guess. Away for you to measure how well customers are accepting of the product. But in the end, the number will be what it is. I imagine there are benefits that come with scale but also drawbacks for sure. You had recall problems before most other automakers on a big scale. How have you managed to avoid it this time . We took a step back and reexamine all of the processes major communication was transparent throughout the country and put it threeyear hiatus on building new plants because we wanted to make sure we have processes in place, utilizing the capacity and most important, that we had human capital, resources of people to run the plants before we started expanding. How do you feel about the way to conduct the tway tacata has reacted to this . Tough to say because i am not sitting in his shoes. All i can say is we want to make sure customers are safe and feel safe. As an industry i think we are all getting together to examine what happened and what the fixes will be. Were are confident Going Forward customers are safe. Focusing on the luxury brand lexus. Toyota has a crossover brand out. Are they going to regain the crown are the biggest selling luxury vehicle in america . They work for 11 years. I am not sure it will. We sold over 300,000 for the First Time Since 2007. A lot of what is what was luxury today was not luxury back then. We choose not to play in that game. A shot across the bow at the germans. It is a great vehicle. I am driving a hybrid and tremendous vehicle. Obviously almost synonymous to think of hybrids and toyota. Are you committed to gas powertrain . Is hydrocarbon a great part of your future . I think the plan all along, when we started developing the preassigned hybrid you were developing fuel cell at the same time. The plan was the short to midterm was going to be hybrid. We still believe that is what it is going to be. The infrastructure is not there. If you look at california as an example, 70 fueling stations in the right locations will get customers convenience of no more than 10 minutes to refuel and can handle over 10,000 vehicles in operation. I think hydrogen refueling, you do not need four hydrogen stations on every corner like you do with gas stations today. I am a texas native now. Enqueue. We really appreciate it. Toyota has recently left the golden state and gone to the Lone Star State and now in plano, texas. Thank you for joining us. A lot more from the Detroit Auto Show all day long. Our own matt miller back with matt fields. At 12 00 he has the ceo of nissan. At 3 30 obviously you know matt is excited about this one maserati ceo harold mason. Harald wester. I was just wondering if they would talk about low end luxury below 30,000. What is that . That is called an bloomberg. Low end luxury. The first car i ever owned . A rocky. If anyone knows what it is, i want you to tweet me right now. That was in chile. Can you guess mine . A volkswagen beetle. No. A White Chrysler lebaron convertible. Thank you, new jersey. Retails new normal. The industry likely to shrink. On the other hand cheaper gas. You know this kills me. Let me buy some jeans. Makes no sense. We just wanted to give you an update on sap, the German Software maker. It has resumed training and higher by about 4 right now in early trading. The Company AnnouncedFirst QuarterSoftware Revenue would be 1. 7 billion euros on a right in line with what analysts had been looking for. The stock higher after the announcement. Oracle recovering all of its losses from earlier. At had fallen after sap was suspended from trading. Back where it was. When we return, retail therapy. Big chain stores, will shoppers provide secure . Live from bloomberg headquarters in new york, this is market makers. With Erik Schatzker and stephanie roll. You are watching market makers. I am Erik Schatzker. This year retail facing something of a new reality. Many are shrinking hundreds of closures planned. Its oil prices tumbling, consumers might have cash to bring back to the market. With us is ceo of by manco fi nanco. Goldman sachs just came out to say oil prices will drop to 39 per barrel. There have to be retailers who feel that is great news. No doubt about that. With oil prices lower, consumers will spend significantly lower. I cannot get my head around the fact people go fill up their car with gas and say look where gas prices are, let me run out and get myself a pair of jeans and the loss . If you fill up your car once per week , the end of the month that at that. At the end of the month you say look at the money, let me head to see wonder but i cant because theyre going out of business. Help us there. Not so sure what youre going to do without them. Could be a crisis. The consumer in america has so many choices not only of storefront but online. They will find a place to buy what they need. You have lower cotton prices. Again, that may not sound like a big deal on the face of it but for the garments we are wearing, honda is a big part. That goes down and well probably see price deflation or margin expansion. How much Pricing Power how vicious is it at that end of the retail . When we talk about the extra money because of cheap task they are not spending it at tiffanys but the mid to low end of the market and competition is pretty intense. They may not be able to keep much of the extra margin. It is more of how can i capture sales versus margin . That is not even an option at this point . It is tough. They may be able to squeeze a little bit out but it is all about her motion. What about luxury . With europe in bad shape russians not spending, what will this mean for lux rebrand . I think north american luxury will be fine. Europe in the doldrums. Russia has stopped spending effectively. China with the crackdown on corruption, likewise much less intellectually. Luxury sales should be doing ok. What does that mean for the individual company . Which ones do best and which ones are most reluctant on chinese . Growth over the past 35 years has come from the emerging markets, china in particular. Now that has stopped. Does not mean necessarily they will move backwards but that growth will not be there this year. Mens wearhouse mergers activists, what do we have to look forward to . Three major consolidations and retail last year all had activists involved in them. Mens wearhouse buying joseph a banks or office april fighting officemax, all of them had officemax all of them had activists involved. Activists are involved. The staples, office depot conversation is driven in part by activists. The average market value of the three big mergers last year, up over 50 . That is a very big driver for the activists to get involved in stirring the pot. How about the individual companys ceo gas so how badly do they want to be consolidators . Depends if youre the winner or the loser. The name of the game but is a problem because of the end of the day what matters most is the shareholder value. It comes at enough of a premium that shareholders should be all for it. If you are in a consolidating industry coming your growth is flat to nonexistent. You can restructure the company multiple times or you can consolidate for a huge value for the shareholder, benefit for the business longterm. Lex what is a nonconsolidating industry . They are all right for consolidation. That is true but for sectors new and growing rapidly less means. Athletic wear would be a great example. Lululemon unlikely to consolidate that sector. It was not a thought consolidation within the industry, expanding to a new category. Flex is there a consolidation play for Abercrombie Fitch . We talked about the team retail space. Hard to sell wearing them. I think they do not want it emblazoned across the chest. Underneath my chair shirt. That is where the major shift in what the consumer wants. It is not as brain conscious. Does not want to scream out who is what i identify with. The secular trends are away from spending in that category. Two or three getting together does not necessarily solve the problem in the sector sales arent climbing so rapidly. It is and was such an awesome little store. I love going to see wonder. You can almost always walk out with something fun and unique. I think the problem was they were fairly large. A lot of different products. Very high price retail space. Price points not that affordable. You walk in and what do they really s