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tv   Bloomberg Surveillance  Bloomberg  April 30, 2015 6:00am-8:01am EDT

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greece looks to ease demand. german bonds are crushed. yields surge. oil and saudi arabia. what will be the new normal for opec? good morning, everyone. this is "bloomberg surveillance." we are live from new york. joining me, olivia sterns. do we have some headlines? let's take a look at time warner cable. olivia: the numbers on the revenue side of the topline appear to be coming in a little bit shy of analysts'estimates. the bottom line is also a miss. we are going to speak to our licks sherman, the expert on the subject. tom: a banner just came out. a 90-day nightmare with comcast. olivia: we will speak with alex sherman about time warner cable
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and comcast. tom: salesforce will be interesting. let's get to the top headlines. olivia: it was a night of relative calm in baltimore. there were a few scuffles about the curfew. the worst writing was on monday. most protesters went home. on friday police will turn over their investigation into the death of freddie gray to the state's attorney's office. it will not be made public. gray died of injuries suffered in police custody. a prisoner who share the police van with gray could hear him banging against the walls. he believed he was trying to injure himself. that report came from the "washington post." safety concerns led to a first for major league baseball. a game played without fans. the orioles beat the white sox behind closed doors, eight-two. the death toll has climbed behind -- past 5500 in nepal
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after the deadly earthquake. aid workers are delivering food, water, and medical supplies. rescue crews pulled a teenage boy alive from the rubble of a collapsed building. it has been five days since the quake rocked nepal. the first quarter gdp numbers don't seem to be bothering the fed that much. policymakers left open the chance of an interest rate hike in the second half of the year. the economy was at a virtual standstill for the first three months. janet yellen and her colleagues blamed the slump on transitory factors. they said the growth will pick up to a moderate pace. bill: it is often june. if we get a strong employment port -- report perhaps it will be sooner, but i think it is off.
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they want to prove that they can get out of bed and stand on the run to legs. that means 25 basis points. olivia: in japan the central bank has decided not to increase monetary stimulus. the bank of japan pushed back its timetable for raising 2% inflation because of the collapse in oil prices. may be considering a sale. it is working with bankers to field takeover offers after it was approached by a potential acquirer. salesforce has a market value of $44 billion. it would be the largest ever public software company. tom: we are two days away from the richest fight in boxing history. welterweight's floyd mayweather and manny pacquiao go head-to-head on saturday in las
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vegas. it may gross 300 million large. >> i am a fighter. i have faced so many different styles. we will see how everything goes on saturday night. >> are you excited? [cheers and applause] >> don't get nervous about saturday. i am the one who brings the fight in the ring. relax. take it easy. tom: the body language could not be more different between the two. retail sick it -- ticket prices are falling. the cheapest ticket was $3400 on stub hub. it is a fight. there it is. it is a big deal. let's look at the morning brief. personal income and personal spending. interesting dynamics. it has been secondary.
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we get the savings rate gleaned off. initial jobless claims. we see that every week. those have been stunning numbers for the recent months. the weekly bloomberg consumer comfort index is out at 10:00 a.m. that shows a step to the american consumer but you wonder about it after the brutal first quarter on nominal and real gdp. let's do a day to check. not much to talk about. we arrange-bound. -- we are range-bound. greece moves forward and things move in europe. crude elevated. $60 per barrel on west texas intermediate. euro-yen is the global litmus paper. strong euro, weaker yen over the last couple of days.
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it is an outrageous sterling as well. this is a great chart. this is oil. we are going to do a lot of commodities today. oil, adjusted for inflation. the era of olivia sterns, we are richer now. [laughter] tom: then we were when i was your age in 1940. collapse of opec, persian gulf, china, 2008. the point is that where we are right now. we are back to $63. olivia: oil is as cheap as it was in the 1960's. there is still zero appetite for a gas tax hike. tom: the infrastructure battle the brendan greeley was talking about you wonder where that is
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going to go. it is amazing how cheap we are going back 40 and 50 years as well. it is a range bound world. the fed opined yesterday. joe weisenthal monitors transitory factors. it is boring, but it is not. range bound and yet german bonds. joe: incredible timing. in the last few days, they have been crushed. german bonds are inching close to negative yields. the yield has exploded. tom: price lower. you and i talked to talk about yield, yield yield, yield. bond owners look at price. joe: there are a number of factors that could be in play. perhaps it is because they're
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closer to getting a great deal perhaps because the greek finance minister has been sidelined. after this incredible bull market we have seen some pretty sharp reversals. olivia: i saw the report on bank lending. how about here in the u.s.? we heard about transitory factors. how much of the slowdown in the economy 0.2% growth -- that is brutal -- how much of it is that and how much of it is the long-term things? joe: we definitely knew it was going to be a bad report. analysts' forecasts had come way down. it came in worse than what people were expecting. there were some clear signs of transitory factors. exports probably affected by the ports. other weather related things. there was a lot that seemed to
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be related to the oil crash. cuts in mining expenses, stuff like that. oil seems to have stabilized. tom: when you and tracy distilled this yesterday for bloomberg markets, the assumption was like the fed things are going to get better. the tilt is that things will get better and this is a one-off. joe: it is hard to say what would make things worse. oil has come down a lot. it is hard to not see it as good. there are still bullish tailwinds in terms of household formation. there was a lot more room for the economy to rely for, compared to what we were during the financial crisis. it is hard to see what would drag us down. tom: joe weisenthal, thank you so much. we have a special guest for you this morning. we will speak about nato and ukraine.
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first, we need to play battleship or stratego. a cargo ship flies a flag from the marshall islands the ship was commandeered by iran, what should the united states navy do? we go to war college with a good admiral from tufts university. this is the real deal. what happens next? >> you just showed a chart of the rise and fall of oil. it is really a rise and fall of geopolitics. it is the revenge of geography that comes back to the markets. the narrowest point that the big oil tankers flow through. this is a provocative act by iran. you show the split between the iranian government and the iranian revolutionary guard. it was the revolutionary guard that took the ship they were holding it, supposedly a business dispute.
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we are monitoring it. this is not something we are going to go to war about. tom: when you look at it, the iranian diplomat who was in new york city -- you know this better than me -- he is greeted with open arms. olivia: to the admiral's point that is because there is a normal -- an enormous amount of daylight between the iranian government and the royal guard -- revolutionary guard. >> you have the ayatollah on one side and you have the more moderate forces represented by the foreign minister in new york. tom: everything was fine, go britain, down we go. is it a risk to our ships. >> crude missiles absolutely
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are. we have seen the markets react to the slightest incident in these straits. olivia: the u.s. has reached out to iran to try to get help for a deal with the rebels in yemen. is there scope to partner with iran militarily in the region? admiral stavridis: i don't think so. this is a game of risk. the game that is going on is sunni-shia. we need to stand with our sunni friends. egypt, saudi, the gulf states. that is how yemen is going to play out. it is the 40th anniversary of the fall of saigon, when refugees run out over and over. you may see that play out in yemen. there are 65 warships in eight
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nations -- from eight nations circling yemen looking to take their nationals out. tom: very good. admiral, stay with us. olivia: we look at what could be the largest takeover ever of a software company. this is "bloomberg surveillance." good morning. ♪
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tom: good morning, everyone. "bloomberg surveillance." olivia: the crew of the international space station will have to wait a little longer. an unmanned russian rocket went out of control and burned up while plunging back to earth. spacex is scheduled to launch another supply rocket in june.
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apple's latest offering may have a problem with your tattoo. some customers say tattoos on their wrists are interfering with the device's pulse tracking . i know you have an anchor on your wrist. "the wall street journal" says apple has found a defect in key components. apple is not commenting. elon musk is unveiling a new generation of batteries at a convention in california. he is turning the batteries in tesla cars into upright pillars so they can store growing volumes of solar and wind energy. it could launch another business for tesla. those are your top headlines. tom: i want to get to the view forward. olivia has smart comments on salesforce coming up. we will see russia at the bottom of the hour.
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oil predictions later in the hour. we will look at oil. we are going under $40. that did not work out. the future of opec. we will talk about the future of opec after the drama scene in riyadh over the last 48 hours. olivia: time warner cable reporting results a few minutes ago. alex sherman joins us for the background on the phone. a little bit of a miss here. tom did see that first positive quarterly net ad of residential service subscribers since first quarter 2009. take us below the headline numbers. what is the story? alex: the story really does not have much to do with the operations of the company. part of the reason for the subscriber gain is that time warner cable drastically cut prices, which led to a big pop in numbers. the only thing investors care about is what is the m&a story?
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there are two things at the top of the press release. we are a far stronger company than we were. two we can create more value for shareholders. those seem absolute warning signs, triggers, headlights to selling the companies. why would he refer to five quarters ago? that is when he reached a deal with comcast to begin with and now they may turn around and sell the company to charter communications. it is a signal to charter. you better pay a higher price. olivia: very interesting. you are a better man -- busy man alex sherman. who are the suitors for alex: they hired banks because they got an approach. i'm not sure if they are up for sale or not. someone wants to buy them.
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the theoretical suitors are oracle, microsoft, possibly s.a.p.. we are trying to do our work and figure out who may be approached. if that approach is still alive. all of those are still questions that are going to require a little bit more reporting work by our team. olivia: what about the price? salesforce has a market cap of $48 billion. what is it really worth? how to potential suitors figure it out? alex: it is a huge hurdle to any deal. it would be the largest acquisition of pure tech of all time. a company would really have to really pay up. it would be a totally transformational acquisition for a company like oracle or ibm that has struggled to get into the cloud. salesforce is one of the best in
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class, market share-wise. a lot of these legacy companies have struggled to get into that area. olivia: watch this space, as they say. alex sherman, thank you so much. tom: in our next hour, one of our most popular guests will join us -- barbara corcoran. good morning. ♪
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tom: good morning, everyone. "bloomberg surveillance." admiral stavridis: with us today. a smart morning must-read from "bloomberg view."
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i will let olivia help me. it makes sense for mr. putin to find this kind of equilibrium allowing his country's investment to rebound to gain momentum, while keeping ukraine on the hook. that implies a frozen conflict scenario. nato's equilibrium in this moment. olivia: he is saying that putin is stuck. kiev is stuck and he likes it that way. still with us on set, admiral stavridis:. you think that the right strategy is to send deadly weapons to the ukrainians. that is a strategy that the eu opposes. admiral stavridis: it is the right move because when a bully comes at you, you need to stand up to the bully. the best thing we are going to end up with is a frozen conflict.
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you have a higher propensity to freeze the conflict if we send deadly weapons. olivia: what about the response that putin is going to just send more weapons if we do? admiral stavridis: i think it is highly unlikely because he cannot buy that level of conflicts. he will get more sanctions from the eu if he rolls tanks across that border. olivia: how do you deter putin? joe: you continue with the sanctions -- admiral stavridis: you continue with the sanctions and targeted personal sanctions. you use -- move the weapons to the ukrainians as part of the deterrence matrix. tom: who are you looking for as leaders in europe? admiral stavridis: angela merkel. she carries the water. she has been very firm on putin.
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a further mush and roof to -- russian move to olivia's great question, he will not move tanks because it will trip massive sanctions from the european union. tom: coming up in this hour, helena croft -- jalimahelima croft will join us. what a pleasure. stay with us. "bloomberg surveillance." from a bloomberg -- beautiful new york city. ♪
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'ght to top headlines. olivia: overnight in baltimore, protesters were on the street
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but there were not as many and there was no widespread violence. there were some scuffles, but most protesters went home. hundreds of police and right gear were on the streets earlier in the day. maryland governor larry hogan said he expected tensions would behind. governor hogan: we are going to continue to be careful about staying on top of everything that is happening. we are going to continue to meet with community leaders and that we are protecting the city. we don't know what is going to happen. olivia: on friday, police will turn over their investigation into the death of freddie gray over to the state's attorney's office. a prisoner sharing a police van with gray said he could hear gray banging against the walls and believes he was trying to injure himself. this is according to a police report obtained by the "washington post." in manhattan, hundreds marched
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to protest a gray's death. or than 60 protesters were arrested. greece and its european creditors are trying to break the impasse over bailout aid. they are hoping to have a deal by this sunday. a key factor the great prime minister alexis tsipras has decided to play a major role in the negotiations. greece may face a cash crunch as early as next week. financial professionals have grown more pessimistic about greece's prospects in the past few weeks. 52% surveyed in a bloomberg poll said greece will leave the euro at some point. that is up from 31% in january. hillary clinton now has a progressive challenger from the democratic desk for the democratic nomination. senator bernie sanders will announce that he is running for the white house. he is a socialist to usually votes for democrats.
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sony is forecasting annual profits at lower than expected. sony is increasing sales of its games and camera sensors. tom: it is a three-day extravaganza known as the nfl draft that begins tonight in chicago. chicago is hosting the draft for the first time in 51 years. 51 years. that is like dick butkus. the first quarterback to go will be james stavridis. no, jameis winston. [laughter] olivia: it has been a wild ride for russian rates. tom: there are certain issues like inflation.
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olivia: the ruble has been the best-performing currency. our european editor at large francine lacqua, joins us. good morning. give us a sense of what the outlook is for the european economy. i heard that someone say russia is out of the penalty box. francine: right. it is still in a very difficult position. thank you so much. we had the news from the russian central bank. this is an economy that is still on its knees. it is not an critical territory, but we are expecting gdp to fall by 3%. this is an economy that has had to do with sanctions and lower oil prices. they had a budget based on $100. the ruble is the best-performing currency this year, but it is still gyrating finally, -- violently, especially if you
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look at last year. they are trying to figure out how much they can take rates lower without jeopardizing the bigger picture, which is making sure that people have enough food. olivia: another story rbs still not making any money. what is the back story? francine: rbs is very important. we are one week from the u.k. election. this is a bank that is owned by taxpayers. we would have hoped but -- that by this point we would have had a little better view. it is a political story, as much as it is a banking story. they had a bigger than expected loss and it is going to take a lot more time to restructure this bank. at the moment, it is still not working. it could take 2-3 years. tom: tell us about big oil in europe. tell us about royal dutch. francine: the figures were
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not great. but they are traitors -- traders. this is how big oil works. they have traders. that is almost a natural hedge. it has been paying off for bp earlier in the week. olivia: thank you so much. francine lacqua joining us from london. tom: very good. joining us now, helima croft. we will speak to her about the state of oil, more than anything. you are just back from riyadh. do we get to her goldman sachs is at $39? helima: i don't think we are going to get to $39. i think we will have a recovery to around $70 by year end. that is the feeling i got in the kingdom.
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we are not going back to $100, but we will be getting up to $70. u.s. production growth will slow and demand will pick up. i don't anticipate going to $20 or $30. tom: critically, the supply dynamics in the united states, has that market cleared out? helima: six weeks ago, we were moving to floating storage and we are going to hit $20. if we look at the latest numbers, we are starting to see a little bit of a drop and easing of concerns. at what point do we really start to see u.s. production growth slowing? are equity analysts had a great report -- our equity analysts had a great report. the material slowing of u.s. production growth is important. olivia: still to come, we
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continue the conversation on oil. there were bold predictions about the price of crude in the past year and most of them were way, way off. we will show you where their predictions stand now. we are streaming on your tablet your phone, and don't go away. ♪
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tom: good morning, everyone. "bloomberg surveillance." the 10-year yield off of the fed meeting yesterday. gyrating. more stability today. let's look at the single best chart. here is olivia sterns. olivia: nobody saw it coming. in october, the future looked bright for oil. oil was averaging $97 per barrel. all of those analysts were very wrong. that is the subject of today's single-best chart. what you are looking at on-screen is the current price in white. yellow is the median estimate. once again, it appears that analyst might be looking at oil with rose-colored lenses. with us on set is helima croft. we have ed morse coming on
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saying oil is going to hit $10. rbc has been a relatively accurate forecaster. what did you see coming? helima: to be fair, i was super bowl a sean oil. rbc was having equity analysts make the call. they have been very good at understanding the u.s. supply. a lot of us who came from more fundamental perspectives did not understand the resiliency of u.s. shale production. one of the things i find fascinating is at what point does it start to slow? tom: you bring up an important point. you go to the heart of the debate. at the end of the day, the entire industry -- it is all about microeconomics at the end of the day, isn't it? helima: people were so bullish last year on the price of oil -- you had 3.5 million barrels off the market.
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when you had the situations in iraq in the summer, people thought, oh my gosh, we are going to lose a lot of iraqi production. there was a reason why there was a run-up. you talk about budget break evens. they would not allow this to get this low in the middle east. tom: this goes back to the saudi's. at the end of the day, someone like dr. croft is overwhelmed by the royalty of saudi arabia. to me, it was all most a one-off move. am i wrong? helima: i think there was a decision. there were certain fundamentals that had been shifting since 2008. if you look at the and norma supply growth out of the u.s., it was a total game changer. at what point would it bring the price down? when you go back to october, up to october, prices had already started falling and there was a
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sense that the middle eastern producers, the saudi's would defend the floor. the decision not to defend the floor caused a moment of panic in the market. how loken this go? we were overwhelmed. olivia: that was the moment no one saw coming. if you go to, you can read this great piece. there was an $80 brent case. everybody got it wrong on the bottom and the high end. let's take a look at the photos making news today. number three, ho chi minh city. the 40th anniversary of the end of the vietnam war. south vietnam was captured by the north. the event ended decades of violence. 58,000 u.s. soldiers and three million vietnam me is perished -- vietnamese perished. tom: there it is. that is something. olivia: bud light recently
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withdrew their newest slogan after it received backlash online. the brand said it was "the perfect beer for removing 'no' from your vocabulary for the night." some people said it connected alcohol through sexual assault. the label went through five layers of approval. probably not the right marketing strategy. our number one photo of the day is a song. warren buffett serenading the annual shareholders meeting with a ukulele. >> ♪ i would like to teach the world to sing in perfect harmony ♪ ♪ i would like to buy the world a coke and keep it company ♪ ♪ i would like to teach the world to saying ♪ olivia: you can play a ukulele,
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right? tom: i can fake a ukulele. i think it is a pile of folksome. olivia: you think he is shilling for coke? tom: he does light interviews with light answers. he is folksy. i want to rip up the script. admiral stavridis:, you cannot post vietnam. you had the courage to join the military post vietnam. what was it like to join the u.s. navy as we collapsed? admiral stavridis: we still had a draft at that time. tom: i was in the last one. admiral stavridis: as we tried to edge into this all-volunteer force, we had huge discontinuity, huge drug
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problems, huge alcohol raids. we had jimmy carter cut the defense budget massively. the 1970's were a nightmare. ronald reagan rebuilt the military and things started to improve. the first years after vietnam were dark for the military. tom: thank you for those comments. let's look at our twitter question right now. this is on real estate. where is the best place to invest in real estate right now? good morning. ♪
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tom: good morning, everyone. "bloomberg surveillance." let's get to our top headlines. olivia: american officials raising questions about the pilot who crashed an airliner last month. in 2010, the faa hesitated to give andreas lubitz a flying license in america. george soros may face a huge bill because a tax loophole is now closed. official filings show that a
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soros fund gained $6.7 billion thanks to deferrals. he may oh $6.7 billion. good problem to have. goldman sachs is becoming the first major bank to make a big investment into bitcoin. goldman's partner in the deal is a chinese investment firm. those are your top headlines. tom: into the 7:00 hour, she darkens the door -- barbara corcoran will join us. we will speak to her about her new york city. we will also look at this continuing debate oversee class officers, how to motivate and retain females on the corporate ladder. there is a commodity conference
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at bloomberg today. dambisa moyo will join us to talk about commodities in brazil and china. it was an abrupt changing of the guard in saudi arabia. the old and aged are out. the new royalty is in. it is profound for domestic relations and just as profound for opec. james stavridis. helima croft. as a doctor in economic history at the university of harold james. who is harold james? helima: he wrote "the history of the imf." tom: what did he tell you about saudi arabia? we all read our history of saudi arabia. get away from peter o'toole and omar sharif. [laughter] helima: it is not germany, it is
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not europe. the question of having to make that social contract with your population is so enormously important. as saudi look set oil policy they are looking out over the next decade and saying, we have to maintain the social contract. what is the best policy to maximize that? tom: the distinction here -- abu dhabi and dubai, it is literally a tribal distance of 100 miles or so -- it is the same in riyadh. these are collective tribes. will that attitude continue? helima: i think some of the new guard have a very nationalistic, what is best for all saudi's -- a saudi nationalism. tom: interesting. helima: i think of the technocratic excellence they are so invested in how do we use the fruits of oil for the betterment of the population?
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they have big programs to try to improve health, education. tom: this is a critical issue. the idea of nationhood and nationality coming out of three generations. olivia: yes. the borders drawn in the post-world war i settlement. the new gentleman who has been promoted to number two is leading the charge of the sunni coalition dropping bombs on yemen. why is that such a significant move? admiral stavridis: the thing i would add about saudi arabia is their view of iran and the geopolitical competition that they face, which has religious roots with sunni and shia, but it is great power politics. it is an arab coalition. it is a sunni coalition to stand against the shia world. that is the uber story that is unfolding. tom: two olivia's point on
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yemen, how does the united states respond? admiral stavridis: we have to maintain our connection with the saudi's. they are leading the sunni coalition. that is why we are providing intelligence, error refueling, that is why our warships are off the coast. we are at choice point in the middle east and we need to continue. olivia: how do you justify the alliance with saudi arabia? admiral stavridis: my view is geopolitics trumps. we always look at internal policies. we will continue as friends to criticize where we think it is appropriate. tom: how does this change opec? the cartel seems to be working, but it is a new cartel. helima: what was so fascinating was the decision not to cut -- it is saying, i'm going to take a bet. when prices fall, another
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producer will bear the burden of readjusting. let's see how much high cost oil will come off line. i don't see a near-term shift in that strategy. we have rebounded off the january lows. if you don't get that recovery sustainably into than $70 and $80 they will look back at it. i don't see a shift right now. tom: can they raise the price of oil? helima: what they could do is they could come in and do a coordinated cut with other members and basically take 1.5 million barrels off the market clear off the supply overhead. the saudi's say, if we would have done that, russia would have kept going full pace. we are only going to cut if other producers like russia join us. we are not doing this alone. if the russians kept going, it would have been ineffective. olivia: can you give us an
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update? the conventional wisdom is that islamic state is raging in the country but in the south, everything is fine. helima: i think iraq is a story you should be worried about. iraq is supposed to account of 40% of supply growth in the coming decade. if they underperform, the market will tighten. production is up, but their monthly revenue intake is half of what it was a year ago. they struggle to pay civil servants, the military, oil companies. in order for iraq to go to 8 million barrels by 2035, it is going to require $530 billion of investment. tom: you two want to talk for another two hours. you guys move offset. the two of you, thank you so much. let me look at the forex report. we are migrating. a lot of interesting things going on front and center.
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a battle euro across all markets. euro-yen shows it with a stable yen and a much stronger euro over the recent days. i cannot afford to go to london. stay with us. we will do commodities and oil in the next hour. ♪
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tom: they delay tough decisions. greece adapts come amends to eu demands. on the future of new york city can each and every square foot be gentrified? good morning, everyone. this is "bloomberg surveillance ." i'm tom. joining me, olivia sterns. let's guitar top headlines. -- get to our top headlines. olivia: enforcing the curfew at the scene of the worst rioting on monday. most protesters went home. please will turn over their investigation into the death of freddie gray to the state attorney's office. it will not be made public. great died of injuries he suffered while in police custody. -- gray died. a man could hear gray baking against the walls that should
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banging against the walls and believed he was turned to injure himself. safety concerns and baltimore led to a first for major league baseball. a game played without fans. a game behind closed doors at camden yards. greece and european creditors -- they're hoping to have a deal by this sunday. a key factor, greece prime minister alexis tsipras trying to play a more major role in negotiations. both sides are at odds. the government will not discuss cutting pensions or imposing a sales tax hike on the greek island. that policymakers indicate those first quarter gdp numbers are not a sign of long-term weakness. policymakers ended their meeting by leaning over a chance of an interest rate hike. the economy was at a standstill
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for the first three months. they blamed the slump on what they called transitory factors. growth will take up a moderate pace. this is what bill gross said. bill gross: if we get a strong employment report, perhaps it's back on, but i think it is off. they want to prove that they are healthy, but they can get out and stand on their own two legs. olivia: in japan, the central bank has decided not to increase monetary stimulus. the bank of japan pushed back in timetable -- a timetable for inflation because of the collapse in oil prices. may be considering whether or not to sell itself. the business software company is working with bankers to field a
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takeover offers after it was approached by a potential acquirer. it had a market value of $44 billion. a token of her would be the largest ever of a software company. -- takeover. tom: it's the richest fight in boxing history, the most hyped welterweights going at it saturday night. the two got together for their final press conference, one more chance to talk up the fight. it may gross $300 million. >> i don't really worry. i'm a fighter. i've faced so many different styles. >> are you excited? [applause] >> don't get nervous on saturday. relax. take it easy. tom: what a difference in those two moments.
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resale prices falling on step up. the cheapest ticket down 19% to $3400 per ticket. we have all sorts of economic data today. jobless claims. all in all, showing a better america over the last number of months. i want to get to a data check. josh right with us. risk on in europe this morning. josh wright is with us. all of a sudden, better than good in europe. you see that in greece three year yield with a huge move here. this was a surprise that helps everyone.
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josh: you have to take a look at what's going on on the greek side. these people are turned to make some adjustments. that has to say something about their position. they might make some concessions and we could get some progress. that has been an important part of the global risk trade for the last several months. tom: it better europe -- barbara corcoran with us as well. i would suggest that helps new york real estate. barbara: all good news helps real estate. i don't care where it comes from. say it in language that i can barely understand. josh: tom's point about a stronger europe is in our interest. it's an important one and one that people have been talking about -- if you dig into the details, there is a change in the composition of growth and that is part of this long-term
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story we have of a global rebalancing. demand from abroad is essentially going to come back and help us. tom: how does currency play into barbara corcoran's world? strong dollar, i'm supposed to go all europeans want by new york city real estate. -- won't buy new york city real estate. barbara: i will hire some greek people. all that money comes here and finds a home here. tom: you don't care about currency movements, do you? barbara: we really don't. there is always some sucker out there that will always overpay for the next condo. olivia: i have been outbid by two foreign all-cash buyers. barbara: you should be looking at a co-op. you get a better deal. come with me after the show. olivia: gdp did grind to a halt.
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there was the weather and the port strike. josh: but that is hoping this will blow over. it might get revised. mr. gross was talking about how they want to make a move. i think they also want to talk a lot about the move because part of their job is to keep the markets honest. especially with the imf breathing down there next. -- their necks. tom: if we get a u.s. that move barbara coker and -- barbara corcoran's mortgage starts going up. like we are seeing in germany this morning, how did that adjust janet yellen future path? josh: one of the big changes for
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the first quarter of this year was the first quarter of last year, housing. housing is a lot stronger. a lot of that was because rates have risen so much. tom: all of it was because of barbara corcoran. what is your minimum property? barbara: roughly $600,000. you can get a nice, small, cozy studio. on the upper east side. south bronx. olivia: how about the consumer numbers? 1.9% did look relatively strong. josh: it's a big slowdown from 4.4% in the first quarter. we've all been saying the consumer is really our hope to get us through this rough patch. that is the big question. consumer sentiment is still high. where is the spending? tom: i want to talk about a great moment yesterday. robert was with us with a
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piercing pull on a wall street that feels underpaid. does new york wall street still at the margin matter in the world of new york real estate? barbara: when wall street is happy those bonuses are big, we feel that immediately. tom: you see a pop in february? barbara: everyone is already spending in their head. they get a lot of big bonuses and they can't wait to show the world how successful they are. what is the biggest statement in the world? did you see my cool penthouse? they will spend anything to make that statement. tom: the energy, that emotion that animal spirit is still here with josh right near 1%? what is the betting right now? ? september?
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josh: september. the distribution of expectation is like head and shoulders -- everyone is talking about september right now, but we have to wait and see. remember, those compositions, it could be later in the year. i would like some real estate trips, too. olivia: get in line. tom: we will continue with barbara corcoran talking about too many americans seems that are out there. -- themes that are out there. where is the best place to invest in real estate? stay with us. good morning. ♪
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tom: good morning, everyone. i'm tom keene. olivia sterns with us. olivia: my morning must read comes from the financial times. how to get more female chief executives. she writes "ask a group of schoolgirls to close their eyes and picture a surgeon, chief executive or a pilot. ask those who visualized the woman to raise their hands. only one or two will go up, if any." how do we get more female executives?
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barbara: it's not an issue of getting executives in the first place because so many are coming out of business school. how do you keep women in that position or on the career path long enough to get to the top office? there is one great reality in life called having children. anyone who has a high-paying job and is a moment home at the same time can tell you how hard it is. that is the real issue. women are smarter than men. they get to a point saying, is this worth it? olivia: what is the fix? josh:barbara: start your own business. they succeed. olivia: what's the difference you noticed between male and female -- barbara: they're much more competitive than the women. the women feel sorry for
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themselves when they take a hit and that is the downfall. tom: what do you mean by that? barbara: if you are going to build a business, it's a matter of jumping over a million obstacles and having the stamina to stand back up and say hit me again. women tend to pout a bit more. tom: you overthink and overanalyze? barbara: they are more genuine and heartfelt than men. that can get you out of the game -- i shame them to death. olivia: mentoring. barbara: i shame them to death. get the heck up. i badgered them. tom: what do you think about lean in?
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barbara: it's a great phrase and it's really true. it is a headset that you belong there and have a right to be there. it is controversial -- i'm all for it because i think it is really true. lean forward and push your way and when you have to. olivia: i lean in to argue with this man. ♪
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tom: good morning, everyone. a special radio moment. we are showing on television and we can discuss radio -- a perfect new york day. barbara corcoran has listed every single property. you probably have. barbara: i would be flying over in my learjet. olivia: the international space
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station will have to wait a little bit longer for supplies. the russian rocket went out of control, burned up while plunging back to earth. space x is scheduled to launch another rocket in june. the new apple watch may have a problem with your tattoo. some customers say the wrist tattoos are interfering with the devices polls tracking function. it's because apple found a defect in the key component. the park is made by acc technologies. apple is not commenting on the story. you on musk unveiling a new generation of batteries at an event today in california. -- elon musk. turning the batteries into upright pillars. it could mark another business for tesla built on the back of
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technology originally designed for electric cars. tom: let's look forward. the bank of japan with changes. what mr. baker greets as he returns to tokyo. -- mr. abe. your twitter answers. where would you put real estate right now? this is a lot of fun. a wonderful bloomberg commodities panel. it was winner take all. now, the commodity world -- iron or down 50% since early 2014. she knows -- she holds one of the toughest undergraduate degrees known to mankind come a degree in chemistry.
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>> totally unrelated. i have no idea. it's been a long-winded journey. absolutely interested in what's going on in the commodity markets. massive dislocation. tom: the idea of the commodity boom oil -- is brazil done? is australia done? >> there is lots of skepticism about what happened. the demand story has been eroded. brazil, south africa, a lot of importers, russia -- exporters. is that demand story going to extend to developed markets? what we've seen in the u.s. with gdp yesterday and also around the story of the u.k. and other european countries showing lackluster growth. olivia: how closely is the commodity story tied to the dollar?
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there has been a pause in the dollar rally and you are seeing iron ore -- copper -- the biggest bearish signal for commodities is the stronger dollar. >> the question you are posting is really a tactical short-term question. it was a few weeks ago when we were talking about the strengthening of the dollar and the story was different. my approach is more structural and long-term. we should be looking at supply trends, demand trends and that's where i think the story gets much more compensated. -- complicated. i'm not here to say we should trade up gold versus dollar or oil -- the more interesting story is where we see these commodities in the next 3-5 years. stunt as constructive as it has been. -- it has not been as constructive as it has been. tom: can the mining companies
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adapt to your cautious view? >> of course. we've seen significant impairment across the mining industry. gold, copper, iron ore. real significant way down on the industry. there is significant upside for companies because there is a lot of room to maneuver around operational efficiency, moving around from the let's sit and wait for a rally -- tom: they clear their balance sheet, clear their mistakes and they move forward. how do you know as a strategic thinker when to get more enthusiastic about these companies that are malleable and shifting? >> the question is relative versus directional. the companies that will show a lot of value are the companies that have done the balance sheet
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work, they cleaned up their financial story, reducing their debt, focusing on long-term opportunities but in a constructive way. the companies that are going to sit back and wait have to do that because they don't have the right management to say -- those companies will struggle. a lot of commodity companies the ones i see doing the hard work reforming their -- >> you were talking about the apple watch. the tattoo is right here. olivia: michelle a when shell agreed to buy bp -- what is the move in the market? >> let's wait and see. commodities companies, because of impairments and a lot of stuff we talked about low prices, there is significant appetite. we have seen a number of deals
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that have been priced quite expensive. the one that people have been talking about has been -- olivia: don't go away. ♪
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tom: we are thrilled to have dambisa moyo with us. this is oil come adjusted for inflation. then come adjusted for the -- this is back to 1950, fixed oil.
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here is opec one, opec to. the persian gulf war, then up we go with the china boom. with rising developed country wealth and income come aware back to oil being pretty reasonable. we are better off. dambisa: are we? i would argue that the real question -- if your question is where do we think this is going next, to me the support and demand is going to come from the emerging markets. i would argue -- you pointed out already that the opec move in terms of china -- my concern is the support is not going to be there because the emerging markets are not participating. 90% of the worlds population lives in emerging markets.
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look at the top 15 countries all are showing 3% -- tom: you question demand dynamics forward. the demand might not be there. dambisa: who isn't? the erosion of demand in developed markets -- it may be because of the supply issues. we have not talked about fracking and shale which people are raving about. the real question is where does demand -- tom: we will discuss asia in a moment. let's get to some top headlines. olivia: the city of baltimore is not back to normal quite yet but the run as any protesters out overnight and things were relatively calm. if you scuffles when police tried to enforce the 10:00 p.m. curfew. edges of police were on the streets. larry hogan said he expected
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tensions wouldn't be as high. >> we will continue to be careful about it stay on top of everything that's happening, meet with community leaders make sure we are out there protecting the city. olivia: on friday, police will turnover their investigation into the death of freddie gray to the state's attorney's office. a prisoner sharing a police van with gray says he could hear gray banging against the walls and believed he was trying to injure himself. you can read that story in the washington post this morning. hundreds marched to protest gray pot staff. 60 protesters were arrested after police warned them not to block traffic. -- gray's death. it has been five days since the earthquake devastated nepal.
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the death toll has climbed past 5500. more than 11,000 were injured. foreign aid organizations are delivering food and water to remote villages. a socialist from vermont will challenge hillary clinton for the democratic nomination for president. bernie sanders will formally announce today that he is running for the white house. he is listed as an independent and usually votes with democrats. he could force clinton to deal more seriously with the party's left wing. sony's recovery plan going slower than expected. sony smartphones are struggling to compete with models from apple and cheaper chinese makers. sony is increasing sales of its games and camera sensors. tom: diehard pro-football fans will be glued to three days of an extravaganza -- the nfl draft in chicago. fans are ramped up about this. chicago's hosting of the draft
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for the first time in 51 years. tampa bay will use a first pick to go after it better than good quarterback from florida state, mr. winston. those are the top headlines this morning. the data check this morning is really rich. we have been really range bound. it features at negative six, the 10 year yield not doing much. the story this morning is in europe. a risk on field. greece get some courage to speak to germany and eu authorities. way away from the parity call up two weeks ago. nymex crude pushing near 60. the vicks showing the good markets -- brent crude is something. really getting back up to a range we've seen -- the euro
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strong versus the yen. we've decided we can't afford to go to london anytime soon. olivia: this is "bloomberg surveillance." tom: on japan, all day and obama -- abe and obama. the prime minister returns to tokyo. dambisa moyo is a global economist and author. here for an important panel on commodities are also with us, barbara corcoran. that must have been quite a decision. barbara: i said i would take it right away. i signed the contract without
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reading it. tom: congratulations. abe goes back to asia and it's a most interesting relationship between south korea -- we see it in the currency markets. what is the backstory of how this new japan deals with asia? dambisa: i was at a conference last week where people were talking about the global macroeconomic situation. they somehow missed japan. is this a really new japan? we are very hopeful in the sense that i think so many expectations that there might be a turnaround in terms of monetary policy and the fiscal moves in terms of are they going to do the move along with the reforms they need to do. we are trading sideways in terms of our expectations. tom: i bring your world over to barbara's world. middle class, middle class, middle class in tim cook's call.
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china is buying most of the west coast of the united states. is the asian investment that we see in vancouver, seattle, los angeles moving to the east coast? barbara: it is already on the east coast but it's more dominant there. when i was in l.a., i toward wine country new wine country -- the chinese have their own wineries and they were buying huge mansions custom built with acres and acres of property that had never had wine before because they want the bragging rights that they have their own winery. tom: what is the critical distinction between the japanese buying pebble beach one million years ago and this new wave? what is the new asian distinction? dambisa: it is a different world in the sense that we have technology as an investment opportunity.
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i would say, as a more cultural social norm, it's much more assimilation. in the japanese -- it's a different context. that was much more integration. the chinese approach in terms of buying a property in moving into neighborhoods is relatively new in the west coast, but they've been doing this across the rest of the world. olivia: what exactly are they buying? everybody wants to get into -- are they buy middle-class houses in new york city? barbara: in places like queens, buying them by the dozen. that has the most upward potential of all the surrounding manhattan areas. they are buying the top of the market to the bottom of the
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market because they have great confidence that their money is going to be safe. tom: it would be a responsible if i did not ask you about the u.k. elections. what should we look for in the next week? dambisa: the two key numbers are 270 and 290. at 270, labor is an. -- in. that would be challenging for britain despite the relatively poor gdp print this week. the other number is 290, the conservative minimum number they have to clear. whatever the case, this is not great for the uncertainty of the general public policy and the policy issues that britain will continue to face. frankly, there are significant challenges that the world community -- economy will continue to deal with. you want a lot more certainty. olivia: only a few more days to
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go. dambisa moyo thank you so much. i've twitter question of the day -- our twitter question for the day where is the best place to invest in real estate? ♪
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tom: good morning everyone. olivia: an mba is one of the
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most coveted degrees you can earn in higher education, but it is expensive. is it worth it? barbara, you have lots of young eager onto benares -- entrepreneurs. does it make a difference? barbara: i think it is certainly worth it. harvard is $50,000? olivia: two years all in. it's a quarter million dollars. barbara: i don't think it's worth it unless take retention all to get promotions. -- unless it is a credential. it gets in the way because you are setting the theory of how to do a business. you understand all the language the fancy talk and what you don't get is street smart because you are busy in the classroom. tom: those who can't do, teach.
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you talk for a year -- taught for one year and said enough of this. breeds a car yes as we all need a liberal education. -- farida zakaria says we all need a liberal education. barbara: you don't really use algebra and calculus to start a business for your self. most of my successful entrepreneurs cannot read a financial statement. what we are very good on his thinking on our feet, being street smart and sizing up people. tom: you go back to statistics and type one, type to construct -- she is doing that model. you have a rough findability, running a business day-to-day to say no people have a hard time
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saying no. barbara: i'm pretty much a yes girl. i say yes and yes and then will it and manipulated my way as a no. i have to say again, with all the entrepreneurs making a ton of money on shark tank -- i've invested in 32 companies and there are seven widely -- that are wildly successful. olivia: what is that quality that makes you want to bet on somebody? barbara: thinking on your feet is like an obstacle race. not feeling sorry for yourself. tom: tell me about uber. barbara: i'm jealous. i wish it was mine. tom: i talked to a guy from pakistan with two restaurants going under in new jersey and he said his work in uber saved his
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to businesses. barbara: i don't even know how the car services will stay in business. it is ridiculously successful. i wish i had invested in that business. tom: barbara, thank you so much. come back again. the star of "shark tank." olivia: still to come, the conversation about mba's continue. ♪
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tom: good morning, everyone. a pretty cool number after the panic of $43 a barrel not too long ago. let's get to our top headlines. olivia: for the first time in six years both houses of congress agree on spending. final approval is inspected next week on a budget deal reached by house and senate negotiators. the gop plan puts more money into defense and less than to the mystic programs and promises balanced spending. -- less into domestic programs.
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industries will have to reduce smokestack emissions and utilities will have to use more low pollution sources. some business leaders say the plan would put them at a competitive disadvantage. goldman sachs becoming the first major bank to make a big bet on bitcoin leading a $50 million deal to back a bitcoin startup. laments partner is a -- goldman sachs partner is a chinese investment firm. tom: looking forward, 8:00 a.m., looking at the u.s. economy after the fed meeting yesterday. a lot going on in tesla. most interesting, having to do with batteries. continued discussion on what the american economy will do. in june-september-december rate hike gaime.
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ok, enough. new york city. olivia: new york city has gone condo crazy. citywide spending on apartment construction soared 73% in 2014 to a record $11.9 billion. that is $5 billion over the previous record. the average cost per square foot in manhattan now stands at an eye watering $1800. barbara corcoran build a real estate empire up this relentless demand to own a piece of the big apple. now, she mentors entrepreneurs. what is going on? is this sustainable? barbara: it is not in a bubble right now because does we will have to wait and see. the demand is there.
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no one really knows when it's going to happen or when it will burst. everybody takes their wild guess and nobody is ever right. between now and then, let people buy these apartments, they are spending a ton, parking a ton of money. olivia: we spend a lot of time focusing on the ultra wealthy -- what about new construction for the middle class? is there any new affordable housing? barbara: not in the new york city area. the average new home in america is $220,000. can you imagine? parking spots are selling for $1 million in soho. tom: you have to go across the river -- did you sell brooklyn when you started out? barbara: we were the first company to open in brooklyn and people thought we were crazy.
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that market was hot and it was the first time i ever made a profit in three months. tom: move forward 20 years, do you assume a further gentrification of the five boroughs? barbara: of course. it continues all around us. as long as you are within an hour commute you are considered part of new york and the prices keep going up. olivia: i dated a guy briefly who argued in favor of the poo rridor. this is the only thing that makes sense for developers. it's a solution to affordable housing -- developers having a separate door -- they live in the same building and go in a separate door. barbara: socially, it sounds ridiculous. there are projects like that. the minute you go in through the
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right door, you forget about the poor door. it brings down the cost. tom: you walked -- there is too big holes in the ground. are you a believer in their value? barbara: of course it will go up. they're building the most expensive construction at the most expensive time in history -- its lycoris racing. -- it is lycoris racing. -- like horse racing. tom: the carlyle hotel looks down at those tall buildings and says -- barbara: it is ruining her view. she wants everything to be as beautiful as the day she moved in. it's a complaint. file it. tom: what is your number one
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advice to olivia sterns looking at real estate? barbara: she has lost two apartments. that is a broker stream. when you get a customer who has lost two apartments, they will pay virtually anything for the third. tom: how does she not make a complete fool of herself? barbara: she will overpay for the next apartment she falls in love with and then will justify it by the time she closes and it will be worth another 10% three months out. tom: do i care about granite counters? barbara: it is outdated. she could buy a dump and as long as she convinces herself she is smart about it, she will be happily ever after. olivia: i shouldn't worry about overpaying? barbara: the last sale has no bearing on what you should be paying. you should become parent what is out there.
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tom: what happens to your world if mortgage rates go up? what happens when we get this rate left? -- lift? barbara: does it affect the real estate market? definitely. one percentage point would not do a thing. suddenly, there is a deadline. olivia: where is the best value in new york city? barbara: the closer to the george washington bridge and the more west, the more value. if i had a ton of money and i wasn't blowing it on shark tank businesses, i would be up there every day of the week to shop real estate. the views are amazing -- they are so grossly undervalued. tom: the 2nd avenue construction
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-- what is going to happen there? barbara: i think it is grossly overrated. all those buildings dropped in value relative to the rest of the city because it's been such a mess for so long. tom: should you buy 2nd avenue or madison avenue? barbara: second avenue will go up the most but who wants to live in construction? tom: a modest twitter response today. olivia: we asked, where is the best place to invest in real estate? "a coin toss. go where they will come." barbara: that is safe. olivia: "switzerland. stay away from moscow." barbara: who is that person?
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olivia: a tough one. "where i am investing." tom: they got that deal with hulu this week. what is the worst practice people go on "shark tank?" barbara: they start speaking in fancy words that no one understands. they borrowed money from their parents and have no qualms about the fact that they are not making money and will never hit back. -- pay it back. wacky engineers with ideas that make no sense. the first to bug me. the fancy words -- it isn't so much harder for rich
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kids to succeed. first generation immigrants have nothing to lose. tom: >> "bloomberg surveillance" continues on radio. good morning. ♪
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omberg world headquarters. you are "in the loop."
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we have a great show lined up for you this morning. a huge week -- fed and economic numbers. jobless claims and wage numbers out in half an hour. we get the ball take with adam parker -- bull take with adam parker. john kline is "in the loop." the time warner cable talks to why kim kardashian's worth $800 million. a lot ahead. will you buy the package to watch the fight? a story of survival brightens a grim recovery effort in nepal. a teenage boy is rescued from the wreckage of a building that collapsed. the death toll now over 5500. much of the country has no power or running water. 70,000


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