Allimportant unemployment number. Only one to speak up, apollo education after the market. One final note, this is for you. Do you know who is going to the white house today . The red sox. Their gameees begin season, to. They have president ial support. Stocks, bonds, currencies and commodities to get your second order beginning. What a market day yesterday. S p futures continue to fall. Does not do much. Hydrocarbons still elevated. The fix nicely below 1400, showing the power in the markets. Continues. A stronger ruble and gold. Story under 1300. The king at the dow. Up 14 months. A certain character to it. The blue chips as well. Janet yellen industrial average. She telegraphed yesterday in speaking that the fed will be therefore longer times. The actual word was like considerable. At t announced it was not small potatoes. This is the kind of thing that continues to drive share prices higher. By the way, adam parker pointed out 2. 9 of the shares outstanding are being brought back the sheer. Evaporate like that. What a busy day for the front pages of the web. So many stories of top contenders. Leading with the fbi. Now investigating whether highfrequency trading firms break the law. Are they acting on nonpublic information to gain an edge . A question about timing because Michael Lewis is trying to sell his book on trading. This stems from a multiyear investigation of highfrequency trading that has resulted in 79 infractions. You look at all of the articles. Sam i Bloomberg News did us fabulous did a fabulous job to make you smarter on the debate. I put that out on twitter. Absolutely. Something that will continue to rattle the markets. Whether it is or is not. The basic thing is there are examines. Micro my theme is goliath versus goliath. Big versus little. Little guy is less removed. About big guys and public stock exchanges. It is the twitter question of the date. That is a good question. Something Michael Lewis brings up as well, what is the best response to highfrequency trading . What is the response from a regulator point of view . The best response might be make sure you use limit orders. Tweet us with your response on that. Second page story is enrollment for Affordable Care act begins the same way it began, with computer crashes. The federal website crashed at least twice after a Million People visited before noon to meet the deadline. Everyone was rushing at the last minute. More than one million did sign up. 3. 4 million added to medicaid. Jammed in that the very end. Only america. Said the thing about americans, they get it right, eventually. Story,e third front page the company has widened the recall. The ceo getting ready to testify before Congress Today about faulty ignition switches that have been linked to 13 deaths. If you add it all up, yesterday gm announced the recall of one point 5 million vehicles for faulty steering. So far this year, 6. 3 million vehicles recalled. I have vague memories of cars years ago where the power steering would just go. I have memories of that. The model t, the model a. Those are the front page stories. We need to go to a important phone call. Kerry geithner is with Bloomberg News and following the fbi story. When you look at this story, talk about a new fbi investigation or is this an Ongoing Investigation . Looks like an Ongoing Investigation. Like you said earlier, the flash and the the announcement that the attorney general new york state had opened an investigation into the same area. A lot of movement going on in the space. A lot of people trying to figure out what is going on here and if there is illegal activity happening. You have seen these crimes are for. Do you look at to this as a twoyear, fiveyear, 10 year investigation . Where do Something Like this lead to . Hard to say how long it will go for but we should look at the insidertrading convictions and the string of insidertrading investigation some prosecutors have had on this matter. Those go back to 2007 and possibly before. These cases have built on each other, and you get more and more as you go along. I think this fits nicely into that area of the investigation. Insiderwe talk about trading, we think about knowledge of the company. This is knowledge of trading activity. Have we ever seen anything like this before . You do see things where you can take order of information and french run on that and use that information to get it ahead of your own order of information. Typically you are right, for insidertrading you get information about a stock price. You trade on that and not necessarily legal. The actual fact of it is a little bit different. Investigationbia going to litigate the flash is this may 2010 fbi investigation going to litigate the flash crash of may 2010 . I do not know if this will the flash focus on crash. That is something we saw the sec and other regulators focus on. It is hard to make that assumption at this point. I am not sure what else they are looking at or what specific, so we are really in wait and see on that. One final question if we could as you begin your day on this. Look at the idea of exchanges of public entities. Would you describe a lot of what thate ascribed this these are very much for profit entities with the board of director that once the most gain . Gain . Nts the most thinkingis definitely of how you set up a system to create a fair and equitable system as well as have profitability. Highfrequency trading and types of services for data feed, those are Revenue Streams that the revenues have. So you probably do see a tension there. I think that is what the investigations are trying to give the heart to. Guest host this morning, ian shepardson. Also joining us, ken senna and record managing director. We will talk to him about the Technology Space doing better than good in the equity markets. It is about confidence in the system. Right now there is a complete upper or about worn exchange trading. These do have an effect on the Financial System and the economy as some point. Correct. It is also a political problem as well. Lack of confidence or that it is rigged. This undermines confidence in the whole array of financial activities. Michael lewis laid to this. He has a story about the guy at the royal bank of canada. There is a guy and a white hat. I get that. Within that, this widens the gap when we say it is rigged between main street and wall street. No other way to put it. Moneyke a teeny bit of from a lot of people every day and begins to give the appearance fully version of confidence, too. Ken senna of Evercore Partners, you follow the big Tech Companies. A similar sense the game is rigged against small investors when it comes to Tech Companies and how you pursue projects . I think there is an interesting parallel between highfrequency trading and how display advertising is bought now. Ands all about realtime transparency across the space. You are right, it is not like most advertisers better small. They do not have the tools themselves but using advertisement networks to give them the transparency and slight edge in terms of realtime data. Again, has to do with technology. We did not have these tool toys five years ago. The idea of things being realtime our fact. To get you innt trouble at Evercore Partners at if you do not want to talk about highfrequency trading, just say that. Uniform. Man, red sox that would be terrible. Do not want to do that. Getting to company news. Starting with the senate had investigation subcommittee says that caterpillar dodge billions of dollars in tax says. Carl levin says caterpillar avoided paying more than 2. Illion in taxes by shifting caterpillar says it complied with u. S. Tax laws. Company executives will be on capitol hill to face lebanon and the hearing on his report. Bank of america may face another lawsuit tied to the housing crisis. A judge has recommended be a lack of receipt. The bank failed to us close the nature of 800 55 million of Mortgage Securities and sold back in 2007. Bank of america trying to dismiss the claims. Obama and errol area on Mohamed Elerian on plans to write a book about the rise and fall of banks. The first book was a New York Times bestseller. His resignation from pimco triggered a leadership shakeup within the firm. That is todays company news. Coming up, amazon green lit six of the amazon prime services. We will tell you how this retail giant tried to branch away from the way we think about how amazon does business. This is bloomberg surveillance. Streaming live on your tablet, phone and at bloomberg. Com. We will be right back. It is new york city, the buses run on time, the streets are spotlight and adam johnson goes to bed at 8 00. April fools. Which far did you shut down last night . Earlyhetic i go to bed so. Which 3 00 restaurant if you shut down last night . The beginning of the Second Quarter here in new york city. Coming up, robert new delhi former chairman in the loop and of generals travails motors. Good morning. I am tom keene. With mia scarlet fu and adam johnson. You get more sleep than my kids do. I have to go to bed early to get up early to do this job. Good news for tv bingers. Moren has highlighted videos for amazon prime video. They have renewed a Second Season of all the house, one of the first pilots it launched last year. Inspired bycomedy chuck schumer. Living together with colleagues in washington, d. C. Amazon did not review you were data but User Feedback was fairly positive. That was one of the deciding factors in whether amazon would pick up the series. Ken senna covers amazon. The strength here is it is consumer data. They know more about what we watch, what we buy and what were thinking of buying than anyone else. There is the near term opportunity in terms of amazon having a lot of data as far as what media we like and being able to use huger consumption or current consumption around shows they are producing to produce more shows but after tremendous amount of consumer data in terms of everything we do buy. I think that is an opportunity for them if they decide they want to move away from charging content and moving more to addbased models. I think right now they are monetizing the content more through layering it into prime subscriptions. And the u. K. They increased from 49 to 79 and included prime instant video. No time. I would love to watch it. I think there is a lot of opportunity to experiment with other models depending on what consumers choose. Some consumers would rather not pay for prime. Do you think this fits in with the strategy overall . I think so. When you look at amazon for me you look at the businesses. The Retail Business produces a tremendous amount of consumer data. The infrastructure business is doing ever higher levels of algorithms etc. You put those together and clearly there is a big opportunity for advertising as well. Do we need to start thinking some of the as parts. The Retail Business, effectively a tv business and back Office Business providing cloud support for other retailers out there . I tend to think of amazon, and they will describe themselves as very consumer centric. The retail or consumer tries to satisfy on basis of price, selection, convenience but with a look at the enterprise a chief technology officer, it should not be as hard for them were much harder for them than for the average consumer. If they want software, it should the integrated with the infrastructure theyre buying. I think the mission is to place a Software Marketplace on top of the infrastructure that they give away. This is classic destruction. Massive creative destruction. Someone is losing. Numbers of tvted watching going on every year. Amazon is gaining market share from somebody. Who is the losing party . I still think for now you could argue it could be amazon because they are buying the content. I think the mission is to say we want to make sure were bringing folks to the platform. At some point the scale will start start to turn in our favor. As it amazon because theyre pricing things below market . That is a very long game. We will continue this conversation later but one to tell you coming up in the next hour we will come up and highfrequency trading conversation. Larry taff joins us. Says the market is complex but not rigged as Michael Lewis alleges. This is bloomberg surveillance. Good morning, everyone. Im tom keene. We have a plethora of morning must reads today. Listening to a smart one. Jumped out to me from frank bruni writing in the New York Times. Here is why. You know what is happening this week, this is when you find out if you got into college. College admission notices have gone out. Do you remember what when you i do not know what else to say but the envelopes. You either open you open them and are either it or out. Ian shepardson you have one that is about ready to make the plunge. The same britain . It is becoming almost as manic as it is here. Since i did it was a very lowkey thing. Now it is the fullcourt press situation. Is it important to say that you write code . I think it is great for almost any student who have experience writing code. Beats lacrosse. Wrench and spanish do not matter. It is code or chinese. I cannot remember anything from that. It is something i wouldve rather spent more time on. You have all this to come. Lex i am looking forward to it. Who will pay for all of this . I am so glad i am mostly beyond it. It was painful. 59,000 dollars at an ivy league. The average price you pay is a lot lower. Princeton will give loans at 1. 3 variable rate loan. There you go. Coming up, the u. S. Economic recovery remains stuck in the slow lane. We will discuss how janet yellen plans to boost spending coming up next. Bloomberg surveillance. With mia scarlet fu, adam johnson. Fu, adamia scarlet johnson. Us thomas aill join lightning rod of criticism. He always starts a good conversation. Doing a data check now. Beginning of the Second Quarter. Equity markets flat and miserable quarter. The dow 18,067. Adam johnson has some april fools gainers and losers. Two of each on the plus side. To stack to tech stocks, micron up about eight percent. Different report saying it is going to be a solid quarter. Software sales will be up 4. 8 . Oracle was up almost three percent. On the downside, curate keurig selling one point 4 million shares. Test thing. It had a huge runup. Buy one. Liu will it would have its own car. Doing well for us, no question about that. Janet yellen spoke as the markets responded. Made it pretty clear Central Banks will keep low. Fridays jobs report set to show an increase of 200,000 payrolls according to economists we surveyed. The guest host for the hour is ian shepardson. Let me get you the take on it on janet yellen and different approach to Monetary Policy. A little storytelling thing going on there. The mood music was very dovish. If you look at what she said, no different than the standard headline about tapering steady pace and contingent upon the data. The thing is, you can only push this so far. The data ultimately tells them what to do. If we print friday to 50 instead of 200 and the next one is 200 as well. The mood music will count for nothing because they will stop pushing for the fed to be more aggressive. What she is trying to do while you have this data behind you, the self mood music and it works. If the data starts to move beinst you you have to nimble on the way back. Homophones like she is stating the obvious. Absolutely. When the data tells you things are still in the low market, you go out and tell stories about individuals whose stories that the big victor data. The fed is driven by big picture data when it comes to policy. Individual stories do not cut it in the macros move the other way. It has a limit. The limit is driven by the data. Where do you see inflationary pressures . We talked about rising prices, coffee and orange juice. Why does that not count as inflation . Unless it comes back to wages, it is just a relatively price shift relative price shift. The biggest thing is rent. Is says there is pressure building because we have a very tight markets and are seeing a steady acceleration. Here is the headache right now. We begin the Second Quarter. Idea of core pc inflation. Down we go. Thus inflation. Is this the nightmare, the idea that within that all the blather in the mix that you look at every day, when inflation stays level we can see further disinflation . I would be surprised to see further disinflation. Some of the things pulling the , Financial Services prices slowed down and picking up again and rent is gradually grinding up. Window receive wage growth . See wage growth . Anytime now. With unemployment falling toward six percent, we should see a little bit of a report for sure. Small companies complaining they cannot get the people they want to hire. Usually that means they have to pay more for them. I would suggest that is the most emails we get. Someone in a suit and tie says a lot of Small Business people tell us we are crazy. Small business accounts for two thirds of the hiring according to john growth. Here is something that jumped off from one of the reports. I read this overnight that healthcare services, effectively hospitals, account for 11 . And that hospital expansion goes up. They have been going down. They have slowed a lot. Part because of the sequester and part because of obama care. When the wage bills are rising at two percent per year and effectively seeing a margin squeeze, so weve seen consolidation, laos and this is not sustainable. In the 1990s. The game is over. The pressure built became unsustainable. I think that will happen this year or early next year as well. Such a big chunk being displayed. So friendly and favorable coming down, down. The margin pressure is too intense. I want to go back to wage pressure and how they are not building up. Ken senna covers financial co