Welcome to the big show. You are watching street smart. Have 59 minutes until the closing bell. Russian president Vladimir Putin says he is not seeking to split ukraine, but he did sign a document to annex crimea. Then words. K louder can he save the company from the damage already been done at gm . Matt miller is my cohost today. Good day to have you. News aboutwith the gm. Good day to be here. I spoke with the undersecretary of the treasury about bitcoin . You didnt talk about it going . Heabout bitcoin as well, but is responsible for the sanctions against these countries. Great day to talk about bitcoin as well. We will have excerpts from the interview. Nothing. Tion data we got, like, crickets. How is the inflation data compiled, right . They are not counting things that you and i never have to buy like ipads. It is a little more weight given what the fed has been doing. Here are the stocks were watching headed into the close. Julie hyman is watching the technicals for us. One of the data points we got werees inflation, guys, housing starts. They were better than expected if you look at the months prior. Forever where he was betterthanexpected and it looks like things are stabilizing if you look at the february was betterthanexpected and it looks like things are stabilizing if you look at where the Housing Market has been going. If you look at homebuilders, that is one of the groups rallying as we see the overall market rallying. D. R. Horton is one of those groups rallying. Another one is general motors. We have been talking about the recall at general motors. The ceo has created a new position to be in charge of safety. It is a new Global Safety position. She also came out with a more public meaculpa culpa about those recalls. Walmart unveiled a new program where it will allow customers to trade in video games for credit at walmart and sams club stores. Are our concerns about the competitive market for used games. What will that mean for gamestop . Those shares down as a result. All right, that is our julie hyman. Talking about highfrequency trading. We have the attorney general of new york who launched an investigation into highfrequency traders who get what he considers an unfair advantage. This is not a gordon gekko like character gobbling up information about companies that no one else has. In some ways, it is more insidious. This predatory behavior gives small segments of the industry a huge advantage and allows them to use technology to reach huge profits based on very minor, but nonetheless unfair advantages. The unfair advantages they work people up, because a lot of people do not feel it is a level enough playing field. This is one week after virgin capital filed an ipo. Gone for fives years can you believe this . Without one day of losses on its books. Will the investigation seriously disrupt the model market regulators have allowed for years . Joining me is the one who broke the story for us. I will start with you. Lets back up and explain why this is a big deal for some investors. Half of all trading, versus zero percent in 1997. What is it thomas and why should people care . The issue is how these traders use technology to, as schneiderman says, gain an advantage. It equals an on level laying aying field. Evel pl you are looking at dark pools. We do not know what goes inside of those. Given the fact there is a lack of transparency worries not just schneiderman and his office so dark pools, they say, by the way, i want to trade this they block of stocks and the volume affects the pricing. It is happening behind the scenes, not being reported in a fully transparent way. Or that frommove 2011, 20 09, 20 08 why do we care again . The sec already looked into this. It was a big story i will tell you exactly why we care. Americans want to know it is a fair system. If some machine has a tiny advantage over you, that somehow in essence feels on american, feels noncapitalist at its foundation. Is there anything that can be done, john coffee, to restore Peoples Trust in the markets, foris it an off highfrequency trading . You can do a number of things. Of the question is who makes the rules . We have a conflict the tween the new York Attorney general and the sec. The practices the attorney general is focused on effectively assess order priority to the highfrequency trading. Right to put their orders and before the rest of the market. Everyone else gets information from reuters and bloomberg. They will tell the Stock Exchange the same time they tell reuters and bloomberg, which gives them a few seconds advantage. You make your purchase, you can invest that money and hold it. Highfrequency only gives someone an advantage over someone doing slightly less highfrequency trading. It is only against die day traitors. If you are a buy and hold investor, like most americans are this is like the flash crash. Felt afterpeople 2008, after the flash crash, after reports like this, they do not have the edge that the professionals have. Is that true . Is it fair to think that . They are trading in and out of stocks over minutes. I dont care if you are trading in and out or you are holding it forever. You dont like the idea is some other guy will have a better shot because he is either aiding someone to do it or there is a computer computing this algorithm whole point of the investigation of what the ag is doing right now is to figure out where those unfair issues lie and figure out if they are legal, illegal, or unfair. John coffee, youre the lawyer. Are they legal or illegal . You cannot have two different different rules for traitors. You have the sec that has tolerated this for years and now you have the attorney general saying this is unfair and deceptive. We cant have two sets of rules for the new york Stock Exchange and the nasdaq knows theseec rules . They have never stepped in to stop it. Hasnt the sec investigated . Arent they concerned . The sec has looked into this. I remember, it was 2011, right . The sec is a civil Regulatory Agency and Eric Schneiderman is the top Law Enforcement in new york. He has a different view deal with two different regulators thing to structure the market this way or that way. Does in the market prevail . Traditionally, the sec is the Principal Market regulator. We have allowed antifraud legislation by the new York Attorney general. This is a much bigger expansion of jurisdiction. You look at the volume and the Participation Rate among average americans, and it is nothing like it was. I think it is hinged by all of this concern. Great job breaking the news. John coffee, always a pleasure. This is a great story here. Im glad you broke it. Indeed. The tensions continue to rise between ukraine and russia. We will have more on this tends situation tense when we return. Plus, we will discuss Worlds Largest trade deal. See you back here. The crisis in Putin Ukraine is escalating. Vladimir officially moved to and russia isea and bolstering its military presence along ukraines border its new order. In a speech he defended russias actions and said russia has no intentions of moving into other parts of ukraine. Tone believe those who scare you about russia, who say dont believe those who scare you about russia, who say other areas of will follow crimea. We dont need the division of ukraine. Remain eo, it will as for crimea, it will remain as the russian tartars wanted. Russian lawmakers are expected to ratify the annexation by this sunday. They better, right . If they know what is good for them. The tensions are rising. Is that even possible . A ukrainian soldier was killed when on identified mastic gunmen stormed a Ukrainian Military installation, leading the Prime Minister of ukraine in two declare the conflict was entering a military phase. Joining me peter cook and the senior managing director from san francisco, pete sanchez. Further or ting is this escalating further or have we reached a plateau here . I think it is escalating further. Both what we saw today, the russian president formally absorbing crimea other nations said dont do it. They did it. Now we have real violence the between ukrainians and we are from you. Ho else in the death of this soldier should be of concern. The ukrainians responded by giving the green light to live ammunition for their soldiers and crimea. It is a tense situation. How did we get to this point . I dont know that the United States has the responsibility of and trolling Vladimir Putin. What i would say it is president , right . He has been pushing at us all along. Precedent, right . Theres a lot of fingerpointing, that this administration did not take him seriously enough. I think the same criticism was leveled at the Bush Administration during the georgia crisis. I think we have good i think we have bad and worse choices as we try to respond to this. I will say, and a lot of pundits are saying that putin is winning. I would say thats a very shortterm view. There will be serious economic consequences in terms of investment. You heard yesterday, ford is talking about not making further investments. I think you will see other companies. Do they care . You talk about the sanctions, sanctions against the oligarchs i think he does. His former undersecretary of commerce, francisco, would know more about the u. S. Interests in russia. But this is a red light for businesses doing business in russia. Businesses calling the u. S. Government and expressing concerns about this. This will hurt down the road. In the meantime, he has numbers, domestic numbers going through the roof, popularity numbers. This does not bode well threw one in he jail, invaded georgia, just like has soldiersll there, lest we forget because we stopped covering it in the media. It did not die. There have been so many times since i have been in this industry, 14 years, i have heard three times investors. Alwaysg russia, and they go back. I am not suggesting there will not be investors. The russian economy is a fragile economy. It is a commoditybased economy. Putin and others have talked about trying to diversify that economy. This will make it hard to do that. This is not just ford. You already have a fragile economy what about the argument that he doesnt care as much as we think . He cares more about his this nationalism and russia reforming its greatness . That is priority number one for him. But somewhere along the line, the economy of russia matters. Be a pinched will down the road that will harm the russian economy in a way that Vladimir Putin will think twice down the road. Whether or not he does right now. We were talking to the undersecretary today about escalating the sanctions. What can we do, what measures can we take to really dissuade them from doing this . The sanctions include freezing assets, restricting travel through visas, banking, restricting the flow of dollars releasing the spr is something people have talked about. Convincing australia to produce 3 Million Barrels a day. When it comes to gas going to europe, that is not something that will turn on a dime. It does have longterm implications for russia. The other question if we focus on the United States, we need to have a pretty strong debate on exports of oil and gas, taking advantage of the resources we have here. We haveinly that domestically. That is an industry that has been taking off and has National Security implications. Anyway, it sounds like this guy does not want to be stopped, sanctions or not. Francisco, you are going to stay with us. Peter, i know you have to catch a train. Catch a train. See you tomorrow morning. At threat. That is a big one. [indiscernible] apparently so. Treasury secretary will tell us what a transatlantic trade deal could really mean for the u. S. Economy. Thats coming up next. It could be the Worlds Largest trade deal. Week president obama and World Leaders will hold talks on bilateral trades. The deal, if it happens, would take up half of the worlds economic output and mean gains for both parties. We are still here with Francisco Sanchez who served as the undersecretary at the u. S. Department of commerce. I know that you were instrumental in helping exports reached alltime highs in 2012. What does a Transatlantic Partnership really mean for us . It means a lot of things. It creates one of the largest free trade rockets in the world. 800 Million People when you add the United States and europe. Tariffs. Just it is reductions of nontariff barriers what . E regulatory cooperation. We have regulations in europe that are very different from here. If you make your product for u. S. Standards, you may have to change it. Remember when we were negotiating a freetrade mbia, and with colo the only thing getting tariffs were our goods going into bia. Mbia colom and i was like, and yet, and yet this is going to help you sell your product. How did the unions feel . They are historically suspicious of trade agreements. If there is one they can embrace, it would be one with europe. The wages are roughly comparable, in some cases higher , then the United States. That is a concern for unions. Our tariffs are not far apart. The real value is in eliminating differences in the way we deal with regulation. Those will not go away, but hopefully we will have some corporation, harmonizing standards we will have some cooperation, harmonizing standards. If they are going to be for a trade agreement, this is the one. Otherwise they will be protectionist. That has worked out for them so far. Still to come, gm appoints a new security chief in the wake of over one point five additional recalls, but has the damage already been done by brant to the brand . Im julie hyman with breaking news on adobe, was which was due to report its earnings after the close. It looks like it did release information early on its website. Shares have been searching. 1 revenue came out at billion even. 900 70mate was for million. You can see the spike in the shares as these numbers do come out. The company also reporting segment right segment revenue. The Digital Marketing segment revenue the Digital Media revenue of 641 million. Adobe is the sixth largest Graphics Software maker and the company has been migrating its business, offering more online subscriptions. That has proved to be relatively successful. Judging from these numbers, it looks like it has been working in its favor. After we get a more full report of the numbers after the close of trading, we will get you more details. Right now, the bottom line is the shares are up. Is movingmary barra to fix problems that have led to the vehicle recalls. She names of veteran to a new Global Safety position. Joining us numbereds auto bloombergs auto editor. It seems like this is one of her first orders of business, right . She just came on board. She found out about this recall, found out about the investigation of it in december and her last weeks as developments chief. She became the ceo in midjanuary and by the end of the month they decided they needed to do this recall. It has dominated her opening months on the job. She has had to find yourself trying to get her hands on this and out the bleeding, stop the damage at gm. This is the first structural change said she took the job and everybody got their new jobs. And creating this new decision of Vice President in charge of vehicle safety, really human safety isnt it [indiscernible] i mean, they are a car company, right . There are people who do this stuff, but it was not as high of a level. This is still a few notches were not talking about chief officer, who reports directly to the ceo. This is someone who reports to someone who reports to who had marys old job. Looks atomeone who just engineering or just design who looks of the problem and says this is where the problem started and how we fix it. Ok, just because we are journalists then we are all if she does this, this may be more of a Communications Effort than something substantive . You wonder why her predecessor did not do something about it. You wonder why his predecessor did not do something about it. You wonder why the auto czars did not do anything about it. We have known about it for a long time. Jamie, this is a problem they have known about for more than a decade. Is it . More than a decade now . Problems whenound they were developing a vehicle. They thought they fixed it. They started making the models around 2003. They started getting complaints, but they thought they had a have. I doubt ed would known anything about this. There would be mechanic semi, car salesman who would know, low level engineers who would know. A lot of the pr folks in 2005 when it was getting written about in the new york times, they knew about it. The folks who came in later, they probably did not do that much reading on that level of stuff when they came in. There are questions about who knew what when. What do you think the u. S. Government might know about this . First of all, i would give the ceo the benefit of the doubt. I do not think this is a publicity stunt. Clearly this is a problem that has been around for 10 years and has not been dealt with. Im giving her the benefit of the doubt. You are not a journalist. Im not a journalist. And those folks, steve ratner, those folks from the government the board is not responsible for daytoday operations. There was clearly a problem, but i would not blame it on the board of directors. If there was a problem with the bloomberg terminal that was killing users, i feel like our board would get directly involved. Dont you think . I agree, but apparently it did not get to ms. Barra. That is the cynic in me. The headw could she as of Product Development not know about this . Journalists knew about it very well in 2005. H