How stone brewery is tapping the barrel some of the biggest markets for beers. All of that and more, but first, my cohost. That meeting would rue all around a 54 billion hostile takeover bid. Set for october 6. Williamssonoma trades are down after hours. Retailer another falling during afterhours trading. Fighting a sluggish economic environment. Thanks very much, carol massar. The American Family is an insecure one, that is what Marianne Cooper discovered when she looked at how the recent recession has affected the American Family. The title of her new book is titled cut adrift families and insecure times. She teaches gender research at Stanford University and was the lead researcher on the book lean in women and work and the will to lead. That was coauthored by sheryl sandberg. Why did you decide to write this book . I decided to write it because most of the discussion about inequality and insecurity is statistics and its presented in graphs and charts. But theres a lot of humanity in this story, so i wanted to but the human face on it. Putting that human face on Financial Anxiety and stress, in doing so, what did you discover . I discovered we are weighed down by something very similar, which is the anxiety generated in hard times. From wealthy Business Executives to lowpaid domestic workers, everyone is feeling insecure. We just deal with it differently. Lets talk about some of the ways in which people deal with it. Have we learned anything through the recession about what is and is not important when it comes to money . I think, after the recession, median Family Income is down. Many families are doing this belt tightening and they are trying to get by on very little amounts of money. This is worrisome from an economic perspective, because then they have to turn to credit to get the things they need. We saw how that worked last time, which is that they take on too much debt and they buckle under the weight of that debt and our economy goes down as well. There are some elements to this. Lets talk about someones jobs. Do you have any longterm assurance that he will have a job . Not even longterm assurance, but whether you will get a good wage and benefits. It used to be that we shared risk with our employers. They used to provide us with benefits, health care, retirement, all these things that enabled us to have a good, and secure life. That has begun to unravel and the risk goes on to the families. Does that encourage more individual responsibility . It does, but it leads to is insecurity for families. Families need to have a Foundation Upon which they can plan and execute toward longrange goals. If they do not have stability, its hard to plan. One of the longterm goals can be providing for the education of children in the family. What did the book reveal about people who anxiety there . There is only a portion of americans that can set aside anything for sending kids to college, and that is upperclass families. Many wanted to send their kids to elite educational institutions. That cost a lot of money. Harvard and princeton is close to 500,000. They are worried as well. What about the notion that the things that used to be considered luxuries are now considered necessities . Whether it is entertainment or clothing or travel, in previous recessions or even during the depression, those things were unheard of. I think a lot of americans have reduced their spending on several things. Most of us are focused on the basics. I found that people were trying to make insecurity seem more secure than in actually was. They were talking themselves through insecurity and putting a brave face on what was actually a very sad reality. What is the role of the u. S. Government when it comes to providing some kind of foundation for peoples financial future . I think its central, and Public Policy has failed us. When people experience insecurity, they often experience it as a personal failure. It is not something they did wrong necessarily. It is that policy has failed them. Policy needs to change to get us out of it. Is it other institutions, maybe social community groups, or religious institutions can provide the basis for this Financial Health . Religious institutions are right now. Welfare has been outsourced on the federal government out to state based and faithbased urbanizations command they are doing an amazing job providing people with food, shelter, and clothing. The problem is, people in need that should not be only place to go. It can lead to people feeling like they have to say things or believe in things that they might not necessarily believe in order to get the help they need. People need to be able to turn to their employer, their community, and two other types of institutions to get these things. It is obviously a mosaic and there are different pieces to the fabric of wealth in america. What about the upper income brackets . What do they worry about . They worry about creating an economic firewall between their family and this economic insecurity. The problem is, affluent families respond by pushing for more and more. Workingclass families actually lower their expectations and try to get used to less. We actually make inequality worse. And then we do not have the political will to come together and stop it. As far as education to lift people out of this morass of Financial Anxiety that you have described, is this successful . Is that the right path to try to alleviate these kinds of worries . Its one thing we absolutely need. We need more americans in higher education. What we are seeing is that middleclass and workingclass kids are enrolling at lower rates and graduating at lower rates. That is opposite of what we need. As far as the prognosis, after coming complete circle with the book, are you more or less encouraged . Im optimistic because it is something people are talking about. We need to come together and realize we have a problem. We need to create, like a 12 step program to get out of it. People are talking about it, and that is the first up in addressing it. I want to thank you for giving us his research and enlightening us about this issue. Mary ann cooper, sociologist and author of the book cut adrift families in insecure times. Coming up, taking a look at the Central Government and whether these are being shifted to the poor. We are talking about poverty capitalism next. This is taking stock on bloomberg. Im pimm fox. There is always been a relationship, for example, between defense contractors and the United States military. What happens when services are shifted to the poor . We are joined by tom edsall, a professor at columbia university, and author of age of austerity. He joins us from washington. I wonder if you can just describe to people what is poverty capitalism. It turns out that the government and private companies are finding that the poor are a great source of revenue. You can shift the costs, in missouri, for example, 20 of the City Government is financed through Municipal Court fines that are imposed way disproportionately on the poor are records that the poorer residents of ferguson. You also have Court Services like probation overseeing, and collection of fines. And they dont charge the government anything. What they do is make their profits by charging the people on probation, or the people who owe money to the Municipal Court a fee for services. You have two mutual back scratching processes where municipal governments are reducing their costs both through fines and transferring services. You recently wrote an oped piece for the New York Times and you gave a description of an Electronic Monitoring Service that is employed by orange county, california. I wonder if you could describe what you found. The company, which actually has over 200 contracts across the country, sentinel offender services, tracks people on probation, provides all the services basically of a probation department. The City Governments can then stop paying the cost of maintaining their own probation department. Sentinel then collects a finance system, they call it, where the offender pays for the cost of electronic monitoring, the costs of drug testing, the cost of a fee whatever fines they owe. All of these costs are shifted to the defendant or probationary person. And the Company Comes out making money and the invisible government comes out making money. I wonder if you could also describe these private Probation Service companies and their relationship to government oversight or regulation. Well, theres a big problem in that they are not subject to the same kind of transparency requirements that governments are. And in many cases, it is very difficult to find out what fees they charge, how much profit they are making. They are usually closely held companies, so you do not see any public annual reports. You have a Public Function taking place in the private sector without any real oversight. And in addition to that, these companies, when they are collecting money from people who owe fines, they use the threat of sending someone to jail for failure to pay the fines as a true Collection Agency tool. Sometimes that is appropriate, but sometimes thats inappropriate. It scares the bejesus out of people. What regulations for instance, with judges . For judges, they want to keep their taxes down and have a lowcost system. Its to their advantage to turn to these companies. And there is making this calculation, the people paying the penalty, in other words the defendants and those paying off fines, often dont vote and in most cases cannot vote against they have committal records. Many states prohibit them from voting. They are not a constituency that judges have to worry about, and they are not a constituency that the general public cares much about. It is kind of a free shot for the judiciary to turn to this kind of process. Much appreciated. Tom edsall, a professor at columbia university, and author of the book age of austerity. Coming up, alibaba is set to go public in september for a potential 190 billion. How is the Company Actually going to sell its stock, and what happens to yahoos stake in the chinese online giant . Find out next. This is taking stock on bloomberg also im pimm fox. Alibaba going public has boosted its spending on public platform. Joining me to discuss this ipo process is leslie picker, who covers ipos for bloomberg news, cory johnson. Leslie, i want to be in with you. The steps that will be taken, once the roadshow, you know, the kind of entertainment portion of the ipo takes place, where they try to dazzle potential investors with all the wonderful things alibaba is doing, what does that look like echo the circus is set to begin and what im hearing from sources is that this will take place over the course of two weeks. They need to go as many places as possible because they need investor byin and Investor Feedback much more so than with the average deal. It starts in hong kong and moved to london and then the u. S. , and not just big cities like new york, boston, san francisco, but places like kansas city, denver, some of the smaller places in the midwest. Why . A broader exposure to do for class of investor base. On the roadshow, they get a sense from investors were they are essentially modeling the shares for a year or so. And then they will have a set range and a perspective to see the best place to price the shares. And the goal is to price them in a way that pops a little bit on the first day and shows a good outcome for the investors that bought into the ipo. Cory johnson, more art than science when it comes to initial Public Offerings echo theres a point where they will have to take the temperature, but yes, this is such a big deal. They have a lot of stock to move. The individual investor wants to get involved, and only the banks best customers will get them. In this case, so much stock will be offered that they are looking at a price that will take this deal down, but also looking to anyone to take it, because they got to sell so many shares. Leslie, anyone can take it. All right, lets describe what would happen if you were a Retail Investor and you want to buy 100 or 200 shares of alibaba. Im assuming that you can do pretty easily. Is more complicated than that. It is very difficult. You have to request it through your broker, who will then get allocated a certain number of shares. I would certainly characterize alibaba as being one of those. It is much more to the goal to get allocation. The way the bankers are devising this deal is, they have two clients. They have the Institutional Investors on the one hand, those who come deal after deal and buy the shares of the company. And on the other hand, they are advising the company and they have to borrow against both of those interests. As you can tell, in that equation, there are no Retail Investors. There is no incentive to get Retail Investors in there. And it has been ruled that those are ok. Ipos are a risky asset class and getting more retail involvement in there may not be a good outcome for everyone. What about institutional . You go to one of the cities on the roadshow and decide alibaba is a good investment. You raise your hand and say, ok, i will take 500,000 shares. There are a couple of dozen investors, the big names. And they will be doling them out to their customers. Exactly. Alibaba will follow the money. They will go to baltimore to visit t. Rowe price and they will visit fidelity. But it is a step letter allocation where they say, i want this many at this range and fewer shares at the high end. It is called the Book Building process where bankers gather that information be able to tell exactly where they price it. Once they do price it, certain institutions will get allocations that they may or may not expect. They may say, i want this many shares at this price, and its given to them and they may keep it until the next day and buy more shares, thats the goal to get the firstday pop, or they may flip it. One company that will be selling some of its shares is yahoo . They have a stake in alibaba. How does that work, cory johnson . In this case, yahoo has been looking for a way to get out of their stake and looking for a way to do that. They will not be selling all their shares. They are threading the needle by keeping some to participate in any of side Going Forward in terms of their valuation. At the same time, getting cash out into corporate offers. Leslie, lets say, you want to buy as an institutional investor, you you want to buy and then sell your shares. Is there a ready market for . Will you be able to move large blocks of stock . That is where the trick comes in. Remember, with facebook, that of course, was 16 billion, so on par we are looking at alibaba. Certain Institutional Investors said, actually, im not taking any allocation here. And other institutions heard the same rumor. They also decided not to get allocations, which led to, of course, the spiraling effect the firstday. Investors realize when they were not joined by their marquee investors, they also had to sell. And guess who picked up the brunt of those sold shares . The Retail Investors. There you go. We have to leave it there. Leslie picker and cory johnson. Coming up next, i will tell you about houlihans restaurant. This is taking stock on bloomberg. Im pimm fox. Carol massar. But Russian Hackers were able to steal data from Jpmorgan Chase and at least one other bank, according to people familiar with the case. The fbi is investigated whether was meant as retaliation against economic sanctions against russia. Members of the Central Workers Union are blocked major thorough fairs in a protest over taxes and wages and the overall cost of living in argentina. And a town in eastern spain were awash in red pulp as people pelted each other with 125 tons of ripe tomatoes. The event was inspired by a food fight between local children in 1945. Nonresidents for the second year in a row were charged to join in. The money was raised to help pay off some debt. Thanks very much. Houlihans restaurant, big expansion plans. The company owns for restaurants four restaurants and has grown. The chief executive, bob hartnett is with us. And also with us, leslie picker. I will let her tell you why she still here. Lets Start Talking about houlihans. How did you get involved with the Restaurant Group . With houlihans . Yes. But i was the co of einsteins. Einsteins bagels. But we took that through bankruptcy and i was looking for something to do and in 2001, houlihans was in a bit of trouble. I got recruited by ge capital to take a look at it for 30 days, and that turn into a 14 year career. 30 days turned into 14 years . Yes. How do you compete with the competition . We have an upscale menu and what separates us from the competition is that our menu is a bit broader than most. Our check average is about 16 and a lot of other casuals are in the 20 range. And we have a robust bar scene. Most casual diners have about a 15 liquor mix. We are at 25 will stop you can go on one side of the restaurant and get a casually elegant meal. Or the other side of the bar is cool and hip with a lot of energy and you get a drink and an appetizer. Its the best of both worlds. Leslie picker, not only are you an expert in the world of initial public offering, but you brought polish to houlihans. You said you worked at houlihans. It was my first job at 16. It was the first job i ever applied for. The reason i went there is because we ate there all the time and i said, ok, its close to the house. I have this fancy dr