Manufacturing coming up. A lot of earnings. Janet yellen is expected to testify before the Banking Committee today. She gets a snow day every once in a while. Lets get a data check. Futures were up, now they are down. Go right on to the next screen. These are the currency markets. Yen abruptly moved on the crimean is. Crimea news. Ukraine currency is out of control. Shows anruble so injection as well. I am watching the japanese yen. Strongerews flow, a yen. That is the place to go. Buy it and sell everything else. We are still not below the 101 level. I would say, right now, it is the rate of change. The direction and the speed in which were moving. The russian flag above parliament south of kiev in crimea, that is something i will say in the last two or three hours. Here is scarlet fu with our front page. Across thestory internet is violence in the ukraine shifting to crimea. Gunmen took over parliament and other government buildings overnight, they raised the russian flag. About 120 gunmen. Has put thein military on alert and ordered military exercises. Ukraines in the part of were russian is spoken. With all of the history 1954,ed going back to saying they will give crimea to the ukraine. 92, russia says come away to minute, independent ukraine, we need to have a force there. A lot of questions about whether ukraine might be split up eventually. Crimea is a semi autonomous region in the ukraine. It does beg the question. We will be speaking about the interview with the acting Prime Minister. The ethnic structure here speaks volumes. 60 russian based in southern ukraine. Tartar. 0 it is a toxic mix. They call it a tinderbox. We are seeing an fire up right now certainly. We want to get to our second frontpage story. This is something you highlighted yesterday. Chinas weaker yen. Chinas central bank has been engineering the drop of the yuan. It is part of the financial reforms. Greater volatility, pushing for the currency to be a legitimate effect of currency in the world. That would make china less dependent on exports and investment. That is something the government is shifting away from for more domestic consumption. Is whateal debate here is share value for the you want yuan and the flow of capital around the world . We know where the u. S. Senate stands on this. About itschumer talked cutting either way. Letting it go up naturally. It has only been allowed to strengthen in a very small increment. They want to widen that. Thehey are doing this with spotlight on russia and the ukraine right now. We will continue with that. Our third story, we go back to banking. Pushing its biggest annual loss since the bailout in 2008. 15 billiondollar deficit for last year. He calls rbs the industrys least trusted leader, does the ceo. The bank. The largest bailout in europe. Still owns the vast majority of the bank and is still pulling the strings. By the way, wire pros playing in the olympics . That is what the nhl is asking the players love it. The players love it and flagwavers love it, i am not fair sure it is fair to college athletes. We need to go to the ukraine. We spoke with the new leadership to read good morning. Good morning. His name is arseniy yatsenyuk, the Prime Minister designate. Inis about it to be voted as the interim Prime Minister of the country for the next few months. Parliament is still chewing over this decision. How front and center is crimea to the management in kiev . Very front and center. I was standing in the parliament here in kiev. Meanwhile, in the crimea, the parliament had just been seized by a group of about 100 gunmen. I asked the Prime Minister about that and he said it is the first crisis he has to deal with and he will deal with it immediately. Can, will do everything we Everything Possible, we will use all tools and legal means in order to stabilize the situation in crimea. For three months, during the unrest on the streets, the worry was that some of the regions in the west of the country would secede because they did not like resident yanukovych and they did not like the russian influence and now we have the opposite situation. At this point, it is just a threat of these regions in the east and the south seceding. This new Prime Minister has an awful lot on his plate, hardly somebody that you would envy. He said he will be the least ever popular Prime Minister in this country. What will be the response of the United Kingdom to what we have seen in the last 24 hours . They have been very clear that they are prepared to support ukraine in dealing with its financial problems. All of the nato countries are being very vocal that they expect russia to stay out of it militarily. I think the real issue here is to what extent is the west going to open its wallet . We heard the u. S. Say they will pony up 1 billion in loan guarantees. Ukraine needs 35 billion. They have 34 billion to go and collection. It will beyuk his job to find the cash. Thank you so much. That important interview. You can see that in its entirety at bloomberg. Com. We are joined by our guest host, the head of the Global Research at the guggenheim partners. Also the global strategist at barclays. This is right up your wheelhouse. The factou make of that it is so fluid in the ukraine from hour to hour . I dont think that is very surprising. I think the russian angle is what scares people right now. No one expects russian intervention right now. But with the military exercises yesterday, what happened in georgia, that is always in the back of peoples minds. Isgiven the fact that there a majority of people of russian ethnicity in crimea, would you expect russia to come to their defense . The russians are coming off a pretty successful olympics. I do not think they want to provoke the type of international incident. But it is very fluid. There would be pressure for russians to come to the defense over the russian speaking population. The black sea fleet is going to be a big issue. Scarlet, you have some important breaking news. We just got results from sears. 3. 30 per share. Revenues are in line with estimates. Sales are down 6. 4 . Other company news. Set to report. The annual report could be released this saturday. Lego topping its rivals in asia. Rose by theo Single Digits in the u. S. And europe and double digits elsewhere. Dont take jamie dimon lightly. A j. P. Morgan Spokesman Says he was saying that market volume is unpredictable at times like the weather. That is todays company news. We are focused on what happened overnight in crimea. We certainly are. That leads us to our twitter question. As Vladimir Putin part of the solution, part of the problem, how does he fit into the puzzle . Tweet us. This is bloomberg surveillance. We will be right back with more. Good morning, everyone. Bloomberg surveillance. The markets get a bit off what we have seen in recent hours. The yen is trying to capture a bid to be a weaker yuan for a flight to quality. Here is the latest headline. Russia builds up baltic sea presence. That is not near ukraine. That is some more up to the northwest of russia. Over scandinavia as well. We want to talk about a couple of retailers that are in turnaround mode internally. Sears Holdings Reporting this morning. 3. 37 per share. Jcpenney reported result yesterday they give a forecast in sales that seemed to signal a little but of turnaround. Lets bring in craig johnson, the president of Customer Growth partners, which offers strategic counseling into retail and Consumer Service sectors. To these latest report cards from sears and jcpenney change the story on their turnaround efforts . Here is a real mixed bag of stories. Jcpenney has been in intensive care and at least the doctors are showing up and they are making slow but steady progress against getting out of a deep hole. With sears, you have a grand old name in american retailer and it is heading downhill and nobody is stepping on the brakes. It has been a stunning debacle. The latest numbers today were not a huge surprise. I guess the backdrop is that we live in a bifurcated america. The middle class is getting squeezed. What happens as their core customers are disappearing . The customers are still there. They are just shopping at different places. Are brandsd sears that are still deeply rooted in the past. Jcpenney underwent an unfortunate transformation two years ago under prior management that alienated the core customers. Side are the kmart brands rooted firmly in the 1980s if not the 1960s and they do not reflect the way people like to shop today. If i look at the forward estimates for sears, losses are forecast every quarter out to 2015. Where should we as investors follow the people who are not going to sears . They have lost a Customer Base in a number of directions. For folks in the mall, the macys is still doing fine. There is little upmarket. Most of these players are losing to some of the newer formats moving off the mall. On a macro basis, you go back 25 years ago and Department Store said 80 of the retail market. Now it is down to 2 . Theyre going to tjs and ross. They are going to walmart, target. They are lost and very heavily. We see those reflected in the numbers. Craig johnson joining us over the phone. Are the mostsears shorted Department Stores. They are not making any money. They have lost the customer. On the cover of the new bloomberg businessweek. The big scandal behind college athletics. This is bloomberg surveillance. Great cover. That is the kind of grade i got. We have all been there. This is Bloomberg Television, streaming live. We will be back. It is a less smoky Independence Square in kiev. Crimea, where in the soviet black fleet is. Keene. With me, adam johnson and scarlet who. Fu. Unemployment in germany falls for the Third Straight month. The drop leaves germanys Unemployment Rate unchanged at 6. 8 . Arizonas governor vetoes a bill after an outcry. The bill allowed Business Owners to refuse based Service Based on their religious beliefs. Major corporations opposed it and some companies threatened to relocate out of arizona. It looks like about not become law. Major changes in store for food labels. Calorie counts will be required to be in large type. What . Now i can see them . Are they actually going to calories know how many were in munchkins, you would not eat them, not even you tom. Sugar and you name it. Beware of what you eat. Good morning, everyone. Scarlet who gets us started. Fu gets us started. It is too early to evaluate president obamas presidency. Does the market see things this way . I think so. Since october until now, from an investment standpoint, congress and the president has stepped out of the way. The fact that we have a nuptial budget, there was not a faceoff on the debt limit this time, there was a small amount of bipartisanship i think it is important for us as investors. How does a president become lame duck . Is there a moment . I think the minute he is reelected he becomes a lame duck. He is already a lame duck. Is that what we are already talking infrastructure . There is nothing new here and i dont think we will see a lot new from an investment standpoint. I dont think the infrastructure proposal will go anywhere. I dont see a lot of prospects there. Thank you. For worldclass opinion and a wide array of business, for politics, cultural topics. We will be right back with more. Good morning, everyone. Bloomberg surveillance. Scarlet and adam with me this morning. Lets get a quick data check. I want to show you the ukrainian currency. Everything moving. The 10 year yield in the u. S. The tension is out there. Here is the tension in the ukraine. It is a hockey stick. The nhl coming back. Massively week ukrainian. We have blown through that this morning. Michael mckee is in charge of currency pronunciation. The h is silent. Here is scarlet with our gainers and losers. Abercrombie fitch rising more than 11 after profits topped estimates. They bought back 150 million worth of shares. Target rose by more than 7 . The biggest gain since 2009. It is beginning to bounce back from the data breach over the holidays. Sears and jcpenney reported this morning. Retail. A mixed bag on make easy to sit here and big pronouncements about retail and the american consumer. You have to dig down. What do we have on crimea . Very much so. It little history lesson. It is a peninsula of 1. 9 Million People and extends out into the black sea. It is part of ukraine. Overnight, 120 militants took over the Parliament Building and raised a russian flag. Croft is with us. Spy. Geopolitical strategist. Why has crimea become the latest flashpoint . This is something that everyone was very concerned about. A russian speaking population. The concern was that with yanukovych john, were you going to have the russian speaking population feel under siege and call for russia to come in on their behalf . Some are saying they want to rejoin russia. Big flashpoint for the European Union and the United States. Thee were talking about sphere of influence that russia is trying to protect. This has been a longterm story. This goes back to George Kennan and international relations. Are we trying to redo the soviet bloc . Does mr. Putin just want a russian bloc . They believe that there is a western effort to break apart the sphere of influence. Why isnt oil moved . There was no oil at risk. They are concerned about a potential gas cut off. So much of the pipeline goes through the ukraine and there was a concern that russia would shut off the flow of gas to russia through the ukraine. That was a big concern. This time, no one is thinking that is going to be the russian play. It is not in their interest to do this. That is something you always have to watch. I would say that the weapon they are likely to use i think shutting off the gas weapon theyld be a would use. Georgiacrimea equivalent . That is what is in the back of peoples minds. Would you have a situation . That is why john kerry and u. S. Officials are telling russian officials to stand down and reminding them of what the russians said about libya. You told us not to going to libya, you should stand down on the situation. Ramificationsge with regard to syria. This is a question of sphere of influence. You have a situation. Are you going to double down on your other remaining ally if you lose crimea . This is strategic. These are military bases. They do not want to lose allies. They are going to throw a lot behind assad right now. Here is my morning russ street must read this morning. A really smart essay. Putin is looking west. Now e is a discussion is china the market for russian gas . Things that he is not going to cut off the gas to europe is that he does not want to lose markets. Great conversation. How does this play in washington . It is fascinating. Takes a lot of pressure off the economy in the u. S. You do not have to worry about rates rocketing up. People by u. S. Bonds. Exactly. Should i take my shoe off and pound the table . That is where we are. Fascinating. This is a conversation that is just beginning. We will take a look at the domestic politics in washington and what the president is doing with regard to infrastructure. Our twitter question of the day is Vladimir Putin part of the solution or problem . Did constantine come up with a question . With a name like constantine. Also coming up in the next hour, a fake classes scandal at unc chapel hill. Coming up. Good morning. Markets on the move. News in the crimea. Credit bonds, lower yields, higher notes in bond prices. People assess what is going on in the southern ukraine. Adam johnson has our top headlines. Consumer andf executive sentiment rose to the highest level in the euro area. This eases pressure on the European Central banks. Sayshinese president pollution is the biggest problem. The pictures that you see daily are absolutely incredible. It is the most prominent problem that beijing faces. Seven Straight Days of hazardous levels. Venezuela hasin declared tomorrow and national holiday. Extend the holiday and the president hopes it will diffuse tension. I think it would be front and center if ukraine was not front and center. We are sliding venezuela in our news report. We will have to rectify that sooner. Ardor version is on college basketball. Are diversion is on college basketball. Shows Mens College Basketball revenue. Louisville is the top. In total, six teams with more than 20 million. Louisvilles Financial Success is largely tied to the publicly funded center. The luxury suites lease at up to 92,000 annually. College basketball is big business and the business can bring big scandal. The fake classes issue at the university of North Carolina chapel hill. Is the scandal bigger than unc . Of course. It is just one slice of life in ncaa inc. More broadly. How this 16ain billion National Industry operates. The problem is that you are taking people who are very talented athletes, bringing them to these university campuses, and they do not necessarily have the Academic Skills to match their athletic skills. I am shocked. Round up the usual suspects. Is anybody shocked . People should be shocked. The university of North Carolina is one of our most prestigious public institutions. Famous peopleld in the humanities, sciences. Whether or not you think it should be the host for a Major Entertainment business, it is certainly thought of as a leading education and research institution. If you are not shocked, you are not attuned to what is going on. Texass Football Program generates the most reve