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tv   Bloomberg Markets  Bloomberg  June 3, 2015 1:00pm-2:01pm EDT

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realistic as they prepare a final proposal on the debt deal. -- the greek prime minister. betty: now that the fifa president has resigned, we will look at what is next. an exclusive interview with meg whitman as she talked about the challenges of turning that company around. ♪ betty: good afternoon. i'm betty liu. mark crumpton. let's begin with a look at the markets. stocks move higher in midday trading. investors welcoming encouraging news about the u.s. job market, and also keeping a close eye on greece as the company tries -- country tries to make the debt payment to the imf. s&p 500 up nearly a quarterback
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percent. dow jones of 76 points at this hour at 18,088. nasdaq composite up over third of a percent at 5095. taking a quick check of gold. gold futures falling nearly a full percent at this hour at $1182.70 per ounce. nymex crude down at 59.87. betty: pretty big drop in oil prices. yields are coming up, particularly for the 10-year note. this is in line with what we have seen in europe as well. really rising in europe. that is leading the change in the bond market. in the currency market the dollar is strengthening, particularly as we saw oil prices down. yen.ollar up against the it is also a little bit weaker
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against the euro given the talks in greece. now a look at the top stories at this hour. the greek prime minister has a message for his country and european creditors, led get real. -- let's get real. brussels will present separatists with a final proposal to a bailout fund and avoid great fault. creditors have been asking for a plan to reform the pension system. mustresident says any plan accomplish several goals. greece wants to stay in the euro. but it should be a strong agreement. a strong agreement is one that produces wrote that has social fairness, but that is also fiscally sustainable and sourcess the remaining
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and factors of financial instability in the financial sector. this will be the component of a stronger agreement. betty: great has committed its own proposal. one official told bloomberg it is not good enough. mark: earlier today we got a look at the adp report. american companies and -- added 200-1000 jobs, slightly higher than estimates. tomorrow we will get initial jobless claims. friday the government comes out with the may report. consumers may be holding back. the consumer industry expanded at the slowest pace in 13 months. i is some nonmanufacturing index came in the within estimates. it makes him a 90% of the u.s. economy. -- makes up 90% of the u.s. economy. the u.s. trade deficit and erode or than forecast in april. merchandise flows were returning
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to normal, following a port related search. it was 50.6 billion in march. betty: oil prices shot up briefly after the government report on crude inventory earlier today. stock prices dropped for the fifth straight week. still, the energy department said total inventories remain your levels we have not been 80 years. --ders from saudi arabia and at opec's mets with the largest companies in vienna. one of them bob dudley. in an exclusive interview, he had this to say about the surplus oil supply. >> fundamentally supplies at a loss of supplied. u.s. oil production is certainly up and then flat. not falling. is not the growth
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rates we saw before. there is just a lot of oil around. betty: he said he is interested in investing in iran if international sanctions are removed. look at the top stories at this hour. "market makers." a wonderful thing. coming up -- betty: you are just lurking, that is all. mark: we will hear from a california winery ceo. he started his own super pac. is it a new trend? betty: are you ending your e-mails all wrong? i ignore all of mark's e-mail. best is the worst thing you can do. with stadium construction already underway, we will look
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at the controversy over holding the 22 world cup in cutter. betty: two huge deals and telecom. para 416.7g all billion. with the backdrop, ceos are on constant lookout or new targets. whitman, ceoay meg of hewlett-packard, sat down with emily chang to discuss what is worth paying up for and what is not. i think what you are seeing quite a bit of increase in m&a activity is our industry is changing. about every 10-15 years in technology i see tech tonic shave -- shift plates go to the main server environment. nowuld say web 1.02 mobility and web services.
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we are on the cusp of another enormous change. when that happens, the industry rearranges it self. we're back in the m&a game now that we have repaired our balance sheet. we bought aruba. context stream eucalyptus. we will augment our core innovation we do internally, innovation, organic but we want to be smart about it. the aruba acquisition was perfect. a good position in networking. we add that to the core business . now we have a terrific value proposition to offer their customers on the occasion of virtually everyone on the campus and branch networks are going to wireless. does anyone plug into an ?thernet cable anymore i don't think so. >> i hope not certainly. will see moree
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consolidation? >> i do think we will see more consolidation. that is typically what happens. i cannot tell you how that will play out. i have not entirely surprised by the m&a you have seen in the recent weeks. m&aink there's two kinds of . one of them is consolidation of big, existing players. there is also the new startups coming up that are either going to go public and be great, it independent standalone companies or be a part of bigger companies . we have to be watching and thinking about what the right thing for us is and both of those areas. then a company like aruba. very successful company. probably in the long run needed to be part of a bigger company. no one has a better connection to customers globally. we operate in 170 countries.
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think you can find hp products anywhere in the world. that is the value we now can provide to aruba, who has a great product, and we plug them into the distribution system. i think you will see sales accelerate. what du you think about valuations? do things seem expensive? >> certainly in the startup environment in silicon valley is seems expensive. if you find a company that is completely disruptive and has a chance to take picture from an incumbent, the valuations might be worth it. we are quite disciplined higher's. we understand the acquisitions need to be accretive. we have to be responsible to our shareholders. i think we have been quite disciplined over the past four years of what we will and will not buy. betty: i want to bring in emily chang from our san francisco bureau.
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great interview with meg whitman. you new details about the split. what did she say? >> this is the first time we have really heard details about when she started thinking of this. how difficult it was to convince the board. she said around last spring she started thinking about all of the potential options from going private to breaking of the company even more. she said she decided splitting into two companies this way was the best scenario. she called it a long journey. this is a company that has been around for 80 years. it was emotional. as far as how she decided to become the ceo for hp enterprise as compared -- as compared to hp ink, she felt there was a strong ceo indian we work who will head up the business, and enterprise she sees a lot more potential. there has been so much
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management turnover, she felt she really needed to stay in the spot for continuity for the company and employees. what did she say about more layoffs? the possibility of that? >> there have been 55,000 layoffs since she took over, and she said there will be more. looking at 1 billion and restructuring charges. 2 billion more in the services business. she said that will lead to more job cuts. she said it is a hard thing she does of the ceo and does not like doing it. there will be more job cuts coming. she would not but a number on it. she said she would have to see how things played out over the next three years to make the decision. she did say there will be job creation coming out of the strategy. they are looking at three more years of restructuring. when does it end? she is certainly optimistic they will get to that point.
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betty: thank you. emily chang from san francisco with her exclusive interview from meg whitman. when republicans get fed up with losing? some start their own super pac. mark: we will meet one who did just that. ♪ ♪
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betty: welcome back to the bloomberg market day. i and betty liu here with mark crumpton. we go to julie hyman for look at the markets. the big am looking at movers. a couple of logistics companies
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are among the best reporters -- performers. ch robinson on of them. rated neutral in new coverage over cleveland research. not think that would be a huge vote of confidence. they enlisted talk about margin improvement. 5%are seeing the shares rise . i also wanted to point out the rebound we are seeing in the dow jones transportation average, and index these guys are a part of. you can see the dow jones transports. people often watching closely. if you go all the way over to the end of this green, the three-day rebound. right now looks like the best is april. it could also end up being the best since late january. bradley said they are having trouble attracting new
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customers to the brand. if you look at the terminal, you see a longer-term chart. the green line is the ipo. it is below the ipo price of $16. it became public back in 2010. not very good performance as of late. retailers inor general. thank you. julie hyman, senior markets correspondent. a look at the top stories. apple recalling the beats uphill speakers after customers that they overheated. eight problems with the battery. one person's finger was burned. apple says customers can apply for $325 refund. receive also elect to credit for the same amount of money. a day after announcing his decision to resign, seth blatter back at work at fifa
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headquarters. meanwhile, intercooler has added six men to ties -- with ties to fifa to the most wanted list. it will be a first for the nfl and yahoo!. the league has signed on with yahoo!, the first free global stream of alive pro football game. yahoo! was strained the game between jacksonville in buffalo october 25 in london. because of the location the game :30 a.m. eastern0 time. that is a look at the top stories of this hour. mark: a political environment drowning in cash. what if you do not trust the groups themselves? how about starting your own super pac? that is what john winery ceo of jordin
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did. phil mattingly has that story from california. >> this does not look like the washington backer of a high-stakes game of egg money politics. and this does not look at your typical washington operator. that is just fine with john jordan. >> i have an eclectic set of interests. >> high up on the list for the northern california vineyard owner, politics. his own brand of big money politics. i am a big money guy. i am not the country club sort of republican that is happy to write a check and be done with it. >> in the new world, money freezes outside groups -- donation limits rain supreme. ofdan follows -- almost republican establishment and gave cash to one of the groups,
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crossroads gps. >> do me a favor, i think everyone lost. they used to be a winner. >> now, $2.6 million across his own super pac and spend even more on a dark money group that does not disclose it all. he ditched the heavy consultant model used by most, and for one reason, politics. he backed a few losing gop candidates and 2014 and came up with his own political advertisement, targeted women voters. the attention that advertisement garnered was validation enough. >> i felt there was creativity on the republican side, so i thought i would give it a little lunch. day job is a neat any indication, creativity is something he has in space.
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-- he has in spades. yes, that is him in a parity of blurred lines. and that is him at the center of dam's off. it is all part of the marketing push for jordan winery. herly 1200 acre estate overseas. he is still mapping out his 2016 plans. >> i don't mind taking the risk your shots, because every now and then you will get one. scott walker is my favorite. i think he read percent biggest match of problem with the democrats. >> for the political junkie willing to spend millions, is does seem to be one obvious question, why do you run for office? >> because i like bass fishing too much.
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you never know. you'd never say never. certainly not the cycle. >> that means you can't run for office either. >> i don't fish. great assignment. >> i was willing to take one for the team and go to one country. he thinks, and he sees a niche where he can play. he likened the analogy to a football game. he is the wedge buster and a kickoff. runs into the opposition, frees up space for other people. an important role in what he is willing to play. mark: did citizens united have anything to do with this? phil mattingly joining us. thanks. coming up, if you and your e-mail with best, you may be
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sending the wrong message. the right way to sign off. we will explain when we come back. ♪ ♪
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mark: welcome back to the bloomberg market day. i am mark crumpton here with eddy loop. betty: how do you sign up on your e-mail? if you are one of those folks who use the word 'best" you are doing it all wrong. more and more people are using the salutation. here with the best ways to sign off is rebecca greenfield. you were telling us, you are getting a lot of feedback on this. >> some people really appreciate it, they say thank you and have changed my life. some people are really angry at and areg they use best
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not changing my ending. best butontinue using it is meaningless and empty and can come off as short. just for your self from best. betty: did she just call me meaningless and empty? mark: what are some of the other ways people are not signing off? >> people still you sincerely. no signticle i push for off, just and the e-mail. mark: i think thanks might be the best option. betty: some people do use e-mail as a formal letter. one if you are doing that and went to do it professionally? >> use your judgment.
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context really helps with all of this. i think for a lot of cases if you see it and rewrite the with ain a way that ends thoughtful thought or question, you don't need the ending. wow. rebecca greenfield, i don't know what to do now. you could see the whole story at how does the story end? cca.t ends with best, rebe that fifang up, now ter hasnt seth blat announced his resignation, what is next or the soccer organization as it goes into rice is no? ♪ ♪
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mark: welcome back to bloomberg market day. i am mark crumpton in new york. ukrainee concerns today is heading back toward
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full-blown war. separatists in eastern ukraine say 15 people in territory under their control were killed during battles around a rebel stronghold. the ukrainian government has accused one another of sparking the latest round of unrest. the internal revenue service will give identity theft victims copies of bogus tax returns filed in their name. the move comes after a bloomberg news article about one identity theft victims effort to learn how much of his personal identity identity thieves had included on a return filed in his name. the irs said the steve's -- the thieves stole the information on 104,000 taxpayers. those returns led to about $39 million in refunds. get ready for more flash crashes and market volatility. designed toules
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make this system safer have also made market less liquid and more prone to sudden swings. the report says global fixed income and equity markets seem reasonably valued. feel for warren buffett, no longer the second richest person in the world. the retailer now worth 71 point half -- 71.5 billion dollars. mr. buffett valued at more than 70 billion. ortega pioneered the concept of bash fashion retail. the ridges person in the world is still the microsoft cofounder bill gates with an estimated 85 point $5 billion fortune. a changing of the guard of the french open. djokovic beat nadal. chasing his
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first french open, the only grand slam he is not one. coming up in the next half hour, the bloomberg market day. mario draghi says his stimulus plan is working. the latest on his forecast for economic growth in europe. startschicago blackhawks their series against the lightning, why it may have been better for the national hockey league if the new york rangers had made the stanley cup finals. a news that he shows even with new regulation, corporate earnings forecast that help determine the value of stocks are getting worse. ter hast seth blat announced his resignation, what is next for the organization, we spoke to the former chairman of england's premier league. we asked him if the 2020 world cup will still have been in cutter? >> that is never going to happen.
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that is a fundamental disagreement between everyone here in europe and south america i believe. i also think north america as well. joining me now from washington is bloomberg allen cap. joining me from columbia .niversity ray katz seth blatter says he is resigning but fifa is still in crisis management mode. what action do they need to take to best manage the crisis? >> the first thing they probably need to do is come up with previously undisclosed information or data. one thing to announce the resignation. the election will probably be in four months for trying -- between december this year and march of next year. the head of the audit committee has already said everything is on the table.
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at -- his try to say annual pay, previously a very closely held secret to show they are making an effort to be more transparent. .his is really fundamental this will be far from resolving all of the issues the organization has. does the transparency that my colleague talked about, does that have to include those at the very highest level? does.hink it's ultimately given the social media environment we are experiencing in this time, transparency is absolutely crucial at every level and must consider the needs, once in interest of every constituent as is the great -- as is the case in any crisis management situation. mark: who is being talked about as the replacement and what will the president's first order of ?usiness be >
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>> there are two candidates. one is prince ali from jordan. it is said he is available to run again. ua other, the head of the european football association, very famous french soccer player from the 1980's. they are the two leading candidates. they both have issues that have been involved for quite some time. she voted to host the world 20 cap. they have both been opponents or at least recent phone is. so they have that. they have set themselves apart for at least the last year or two as opponents to the current regime. so could potentially bring a new pace -- face to fifa. ifa brand damage
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or the sport such that people will understand this is politics as it is in any other form and has nothing to do with the play on the pitch? >> i will take those into parts. i think the fifa brand has been undergoing gradual damage with allegations have materialized. but from an international viewpoint, in terms of what goes on, interest is stronger than ever, particularly the u.s. where you look at adjusted television ratings, looking at world1% on the overall coming to power and factoring in the other countries, japan and china, everyone will be voting with their pocketbooks. it is extremely strong, stronger than ever. i think it will take in my opinion a great leader to fix
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the brand and will not be fixed for quite some time. mark: my colleague just alluded to talk that they should move the location from qatar. why, and is that likely? is likely.think that that is getting into world economic and political issues i would not consider to be my area of expertise. i do not think it is likely. i do not think we need any more international incident. sponsors are concerned. coke is concerned in particular. money talks. so let's see what the sponsors do and say moving forward. talk is cheap. mark: you have a fascinating story. it is at about a bank with links to the scandal. tell us about delta national bank and trust. national bank and trust
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is a funny organization. a private bank name with her brazilians to invest in the united states. it is owned by a holding company in the cayman island and owned by a reclusive 90 plus-year-old .razilian billionaire the interesting thing about delta national is most of the that werements elucidated in the criminal information, most of this came at delta national. tota national played guilty thousand -- 2003 for failing to file a suspicious activity report for accounts for what was really going on. they have been subject to foreign inquiries for money laundering. they have offices in new york, geneva, paraguay and the geneva
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island. well situated in order to route money if you are sending money to paraguay. manageds somehow despite all of the issues to continue a long as it's nothing has happened. they have never had their charter revoked or serious issues. they areends -- says now looking at them but has not suffered particular damage. mark: i will give you the last word. scandal wask, this pushed forward in part by the action taken by the u.s. justice department. will the u.s.-based low back i would hopeis? >> not. all the qs has been looking for is a level playing field. i think the u.s. is a bit responsive over the past couple of years. some of the sponsors have pulled
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out or not renewed. these -- visa at a major controversy a decade ago with mastercard. i would hope not. i would expect some blowback. as is the case anytime the intended gets involved in international issues or otherwise. mark: i think stu ray katz. and my colleague bloomberg allen katz joining us from washington. thank you both so much. still ahead, stanley cup finals begin tonight. can the nfl score with a florida team -- nhl score with a florida ♪ ♪
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mark: welcome back to the bloomberg market day. straight to a check of the markets. julie hyman is standing by. julie: we have had stocks bouncing around a little bit. we had economic data this morning, jobs report. i is and services report. the big report friday. the ecb as well. not changing great but a lot of commentary coming from mario draghi. the s&p gain the smallest of the three major averages. also notable the move in the fonts market with yields on the 10 year rising to the highest since november. 2.36%. it has been quite a move we have seen in the markets.
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something else mario draghi talked about is the volatility in the market. he said it is here to stay. some investors are pointing out that yes, we are seeing volatility in the bond market but not this market. i have on the top in the orange line the move index. the fix, measure of volatility in stocks. 27% for the year to date. the fix down about the same amounts. yes we are seeing the enormous font volatility. we have not seen it happen in the stock market. which of bank chief international economist. that is cause for concern for equity investors. maybe it could be a signal when they finally get clued in to we will see the raise rates that we will see a big uptick and volatility and could be a problem. also wanted to check and what we are seeing in the corporate bond
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market. this tracks investment grade corporate font. the move we have seen over the past several sessions is even more dramatic. the three-day selloff the worst since june 2014. i have a chart going back to the beginning of last year. you can see the three-day selloff we have had. for since june of 2013. what happened? the so-called taper tantrum when investors started to get more concerned rates for going to go of. of course they did not. bank of america now says we are going to likely see more pain in the investment grade corporate market as we do have not a repeat of the taper tantrum, perhaps something similar but the velocity of the move of the treasury -- treasure market over the next several weeks. the top stories
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crossing the bloomberg terminal. welcome to the real world college graduates. adjusted for inflation, college graduates make out with than they did 15 years ago. the average salary just over $37,000. increasedmen barely 12 women salaries fell almost 7%. cbs is offering showtime cable -- cable channel as standalone subscription right band. it will be available next month for $10.99 per month. last month cbs launches digital service that gave access on a number of older ones. american pharrell -- ferro has pharaoh hasamerican arrived. he will try to become the first triple crown winner since affirmed in 1978. affirmed was the last of the 11 crown winners.
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that is a look at the top stories we're following at this hour. tonight 8:00 new york times, chicago blackhawks play the tampa bay lightning's. fans of the rangers are still licking their wins. although the national hockey league does not play favorites, it would have been better for the league if the rangers were in the finals. >> it always helps to have one of the original six teams in the stanley cup finals. when that has happened, ratings have gone up. tworangers had one, expansion teams would have met in the finals. boostedt would have ratings. the most recent time was 2013 when chicago played boston in a six-game series that averaged 5.7 5 million viewers. new york is the largest media market in the u.s.. chicago number three.
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tampa st. petersburg number 13. new york also the biggest city in the u.s. with the most and - - fans. fans like to dislike. that makes the matchup of big draw. what it help hockey bottom line to help other -- to have the rangers in the finals? yes. the nhl problem cannot be signed -- solved with one stellar series. hockey has devoted fans, just not as many as football, baseball, basketball. pastost watch game in the four decades was 2011. game seven of the boston bruins versus vancouver. just over 8.5 million viewers. last season at game on average -- through double that.
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the real issue is revenue. major league baseball made about $9 billion. the nhl around 3 billion. mark: money talks year. money definitely talks. you have a very core group of loyal hockey fans, present company included. , the most read stories of the day, john paulson giving 400 million to harvard's engineering will come the biggest donation that college has ever seen. we are talking about one of the largest guess in american education history. scarlet: not too long ago stephen schwarzman gave 100 million dollars to you for a new student center. harvard and yale do not exactly need the money. and harvard's case, $37 billion endowment.
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so it is doing just fine. to some extent you wonder whether all of the money going into the state of the art facility means they will have to charge higher tuition. mark: mr. paulson issued a statement to say he hopes this gift will make the school at 21st century engineering leader. scarlet: i have a feeling would've been that way without his it. we will talk about that and talk about the many facets of higher education overall. you and i will this us how companies like anthem are now offering free college education is a park to employees. starbucks started it. what is in it for the company's? in a scarlet fu, three you few minutes. coming up, the days after enron, the government try to improve the accuracy of corporate earnings forecast, but appears
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the efforts have been in vain. we will explain next. ♪ ♪
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mark: welcome back to the bloomberg market day. i am mark crumpton in new york. government action like the sarbanes-oxley act were supposed to improve the accuracy of poor burnings estimates. it turns out corporate earnings 2%ecast have actually gotten less accurate from 2000-2013 according to a new study to be published in a financial analyst journal. joining me now, josie ohley. the study shows analysts are unwilling or unable to accurately predict earnings. why not yet found >? >> the company themselves are
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not getting very accurate guidance. the analysts are only doing what they can with what they are given. there is also the idea that right after the measures were passed in 2003, people were on their best behavior. 2004 and 2005 when the microscope was on them. once they felt it had shifted, they went back to their old ways. quality started to suffer. we've seen a decline in accuracy. the test used in the study, they did not determine a cause, but the authors speculate on what is going on. run anything to show why this has been, but they inferred it has been starting with the companies and the quality of information they are giving to the analyst. i think they were planning on doing more of that in the future. have concluded the
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analyst forecasts are less accurate than they were before the measure is passed. it sounds like what we're talking about is due diligence, at least on the company's part. is there anything that can compel companies to release more detailed reports? >> i think one of the big issues is the lack of clarity. they have set the bar low, so it is an easy hurdle to jump over before they denounce earnings -- announce earnings. that may play into the idea they are not getting as good of information because maybe they notwithholding or they are being as transparent as they should be. it is ironic because that was the whole point of sarbanes-oxley to solidify criteria for financial and accounting data. mark: what impact is this having on the market? >> it is basically just resulting in analyst throwing
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darts at a dart board. you cannot really trust exactly of theey are saying all time. their accuracy has gotten worse and more difficult to look at analysts and say i think i know what is going on with the company by reading the research. mark: good to see you. thank you. coming up in the next half hour of bloomberg market day, the federal reserve releases the latest beige book. we will tell you what it says. a look at the markets, the dow, s&p and nasdaq are all trending higher on this wednesday. ♪ ♪
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mark: it's 11:00 a.m. and tempest cisco, 2:00 p.m. in new york and 2:00 a.m. in hong kong. fed raises rates?
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we will take you straight to washington for the headlines. scarlet: we will be hearing from .ber's chief advisor mark: jamie dimon is now a billionaire. good afternoon from bloomberg world headquarters in new york come on mark pocan, here with scarlet fu appeared scarlet: we have breaking news for you. the fed releasing its beige book. had to peter cook for the details. peter: this may beige book could provide jenny ellen and her colleagues at some reassurance the u.s. economy rebounded after that dismal first quarter. the anecdotal r


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