Are Consumers Recovering from a Recession Hangover?

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April 7 (Bloomberg) -- Bloomberg’s Olivia Sterns and David Donabedian, CEO at the Atlantic Trust Company, examine future economic growth and the stock market in "On The Markets." They speak on Bloomberg Television's "Bottom Line." (Source: Bloomberg)

Welcome back to the second half-hour of "bottom line." i'm mark crumpton.

Thanks for staying with us.

An australian official says underwater sounds detected by a ship in the southern indian ocean are consistent with the pings from the aircraft's black boxes.

Officials wanted to take days to confirm whether the signals picked up by the australian navy ship are indeed from the black boxes that belong to flight 370, but they called the discovery very encouraging.

The jet has been missing for a month.

Carolyn the e -- paraylympian oscar pistorious took the stand today.

He is accused of murdering girlfriend reeva s teenkamp.

He says he shot her because he thought she was an intruder in their home.

Attributes are pouring in factor mickey rooney, who died in his california -- for actor mickey rooney, who died in his california home.

He made his debut at the age of 6 and became one of hollywood's biggest box office draws in the 1930's and 1940's. decades later he launched a comeback on broadway as senior 6 -- as he neared 60. he was nominated for 4 academy awards and received 2 special oscars.

Actor mickey rooney died at the age of 93. private equity firms may be facing sanctions after the securities and exchange commission found that they charged inflated fees and expenses.

Cristina alesci has been following this story closely.

What is this about and is it, says a price?

It comes as a little bit of a surprise, but largely speaking we know that since.

Frank mandated greater regulation of the industry, this was going to happen at some point, that the sec was really going to dig in and find out about its practices.

What is happening here is it took about 2 years for the sec to understand the private equity business, and in this stage of the examination, what we're seeing is getting into the weeds . in this case what we found is they reviewed 400 firms and over 50% of them were somehow charging fees that really weren't disclosed correctly or were perhaps a little but overstepping their boundaries.

What i mean by that is the private equity firms charge 2 kinds of fees -- one to their investors, the other to their own or for their companies.

At the end of the day these firms buy and sell companies.

But these clothing -- the holdings they have and those committees charged the companies for that.

They found that the fees were missed how good, in some cases inappropriate.

We're seeing a ramping up, and this is not stopping here.

There are other things that the sec is going to look for with these firms and how they do business.

How is this been allowed to go on for so long and have any big firms been implicated?

To a certain extent this has been allowed to go on so long because investors were happy with the kind of return they were getting from the private equity firms.

Now we see investors more tuned to the fees being charged and whether they are sharing in the fees that the private equity firms are getting it that combined with increased regular tour scrutiny has brought a lot of the practices july.

-- a lot of the practices july.

As for the bigger firms -- carlyle, blackstone, all publicly listed -- they have had to deal with this agency for quite some time because they are publicly listed.

They have compliance departments they have built up and are more tuned into got headlines.

The firms have become very sophisticated in how they handle things and this is more of a concern for the sizable and midsize firms.

Cristina alesci, thank you.

For high school graduates and their parents, it is that time of year.

Colleges and universities around the nation have send out acceptance letters, and now it is time to take schools.

Iran education reporter janet lauren is tracking the trend for the full school year and she joins me now.

Good to see you again.

Is there less competition for the ivy leagues?

This year you saw harvard's administrate drop slightly.

-- and minutes rate dropped slightly.

Harvard had a decrease in applications by about two percent but it is still tough to get into any of those schools.

Is an ivy league education so worth it?

Chances are if you go to one of those schools and qualify for financial aid, you're not paying the sticker price by any means.

They have the most generous financial aid packages out there that i think a lot of parents would still cut off the left arm to send their kid to harvard.

Princeton is offering a great deal for students to get accepted.

How does that work?

Princeton has offered this amazing deal.

It is called the princeton parent loan.

For parents they offer a deal of 1.2% interest rates variable and 1.2% fixed rate, and no origination fees.

If you were to take the government parent loan, the student loan, the rate is significantly higher.

You will also be paying a 4.3% origination fee.

Why is there such a difference.

You will be filling out a loan application.

For the loan it is not underwritten.

You the higher rate because you don't have the same kind of underwriting capacity.

The financial aid is incredibly generous but not everybody will qualify for it.

Say you are still required for your contribution to pay $20,000 for your even though the total cost will be around 60,000, it is hard for families to be able to write that can check.

It gives you a bit of liquidity, and princeton says we do it because we can.

[laughter] yes, amazing.

They have an endowment and are able to secure great rates for families and they don't have any fees.

Who is making use of the loans?

Not a huge percent of the student body population.

About 10% of the families.

They are borrowing for those who do qualify for financial aid about $19,000. some arbitrage going on?

For those who do not qualify for financial aid is about 36,000. if there were arbitrage going on you would see that number a lot higher and you would see much greater but is a patient in the program.

Other universities -- why aren't they doing the same thing?

It is a very good question.

Winston is the fifth largest endowment.

There are 4 -- princeton is the fifth largest endowment.

There are 4 other school systems that have larger endowments.

Janet, you were talking about harvard.

Look at the screen and see that number to the subtotal of bills cost, $58,607 per that is why you and i are sitting in talking right now, isn't it?

That's an enormous amount of money.

And harvard does have a generous financial aid program.

If you make under $60,000, you're not paying anything.

It is a good question why other schools don't offer this.

You either have the government plus loan or you take a home equity line of credit and that just isn't as available anymore.

The home is not an atm the way it used to be.

Higher education reporter janet lorin, thanks so much.

Thank you for having me.

When "bottom line" continues, the validity of collectible trading cards.

We talked to a manager at the topps company.

Koch industries, the company led by billionaires charles and david koch, is in discussions to buy a print group.

They are in discussion with the goldman sachs group private equity fund.

It is likely to be more than the flint annual sales of $3 billion last year.

The sales of coke industries and goldman sachs would mark the end of a years long attempt to exit flint, one of the world's biggest suppliers to the printing and packaging industry.

It is time for the latin america report.

Costa rica opposition leader won a landslide election victory and he promised to tackle the corruption that fueled the voter frustration with the government of the president.

I history professor and former diplomat, he wants 70% of -- he won 70% of the vote in the runoff ballot.

He will be sworn in on may 8. 2. smuggling tunnels with rail systems stretching hundreds of yards across the u.s.-mexico border have been discovered by law enforcement officials.

No contraband was found in connection with the tunnels, which would've the linked warehouse -- which reportedly linked warehouses in a tijuana, mexico and san diego.

Coming up, collectible trading cards.

The major league is underway and soccer's world cup kicks off in june.

We will look at what a company like topps is doing to tap into those events.

We wanted to let you know that bloomberg is the only business news service being offered on amazon firetv.

If you missed any of our enemies, you can watch them on bloomberg on apple tv -- any of our interviews, you can watch them on bloomberg on apple tv.

Derek jeter may retire at the end of the season but he will live on forever on a collectible trading card.

The topps company has evolved over the past 75 years from a family gum business in brooklyn to a classic american sports company could the trading cards continue to foster a connection between fans and their sports heroes.

A brand manager at topps joins me in studio.

Welcome to "bottom line." good to see you.

We are in an age of social media.

How do you make trade cards relevant?

Great question.

One of the biggest problems we have is appealing to a younger demographic, and the way we do that and keep ourselves relevant with the younger consumers through our digital trading card apps.

We have also partnered with bloomberg sports to provide advanced analytical information on the back of our training cards and our mls set just came out last week.

Information, exciting -- new information in exciting -- we will get to that in a moment.

You are a privately owned company.

How did that give you an advantage during the session?

Great question.

Privately owned -- from a professional backing, a report from the business to keep lugging along without any doubt from ownership it and the personal investment cap is moving forward -- kept the business moving.

How did you have to change with the times?

75 years is a long time for kids to be opening cards and eating a lot of gum.

That is what a lot of people remember about topps, how it was once wax packed with bubblegum -- it is a nostalgic thing, part of your childhood.

But the industry has evolved over the past two years so now as opposed to just the trading card feature, it is about autographs and relics and pieces of jerseys and bringing fans closer to the game.

That is what we built ourselves on from the competitive advantage standpoint over the past 15 or 20 years, bringing consumers closer to the game and not having it just be about the card.

Rookie cards are valuable, the veterans hall of famer is an all-stars.

Also, that memorabilia card -- they can't take the collector and bring him closer to the game.

The memorabilia aspect, is that what has turned this from just a collectible card company -- now you have made the pivot.

We're talking big business and big dollars.

Exactly, that has been the linchpin of our success over the last decade or so.

The memorabilia aspect.

Now we look at what we can do to stay relevant within that younger demographic moving forward and i think you see some opportunities with digital.

You also see staying true to traditional collectors, the loyalists who love the trading cards and love the tangible impact of opening a card trying to find a delicate balance.

You talk about major league soccer.

As you mentioned, for purposes of disclosure, your company is partnered with bloomberg sports.

Our sports department provides analytical information on the backs of your mls cards.

This information is pretty advanced.

This isn't your grandfather's stat sheet on the back of the card.

No, it is completely evolved and advanced analytically.

On the back of certain cards you can have passed efficiency, goals shot percentage, saves from the goalkeeper insert the quadrants -- in certain quadrants by taking a step further than we have in the past we think it brings fans closer to the game could that is a bit of the theme you have heard me mention.

It also keeps the card packet relevant.

Exactly.

The statistics that were once on the backs of cards were a linchpin in the 1980's. that information became so readily available on the internet.

What type of feedback have you gotten from fans?

The advanced analytical piece has just been featured on our major league soccer said.

That was released about a week and a half ago.

We are gathering information on how that has done.

I think collectors will be very happy.

It is more interactive.

Bloomberg has hosted website of the top 50 people.

It is an analytical equation.

We have about 30 seconds.

Why mls?

For all of the efforts to get american fans into soccer, it is still a football nation.

It is, but if you look at mls, and the age demographic, 12-24, mls trends very favorably.

It is the second-highest sport about everything except for nfl -- above ncaa football, major league baseball.

In terms of that demographic, i think it is an opportunity for us to grow our consumer base to attract the 12-24-year-old that was once interested in the company, tried to reattach them to the brand and keep them collecting cards well into the future.

Brand manager at topps -- i'm just getting an update.

Derek jeter has scored a run at yankee stadium.

Thank you so much.

Another check of the market movers is on the other side of the break.

To the latest headlines at the top of the hour on bloomberg radio and streaming on your tablet pen to bloomberg.com.

I am mark crumpton in new york.

Ask for joining us.

"on the markets" is next.

See you tomorrow.

56 past hour, which means bloomberg television is "on the markets." i am olivia sterns.

Stocks are firmly in the red.

The s&p has erased its losses the start of the year.

The benchmark is off by about 1.20 five percent.

The nasdaq is continuing easing the biggest selling among the benchmark indexes.

Let's also sure you what is happening to the treasury market.

The treasury rally sending the yield little bit lower.

Trading just below 2.7%. i'm joined by a chief investment officer at the atlantic trust company.

David, you save the consumer is still recovering from its recession hangover.

What do you mean by that?

The great recession was really driven not by the normal cyclical forces.

It was joined by the bursting of the credit bubble and the decline in the credit environment.

That takes many years to repair itself.

We had a very slow economic recovery, including by the consumer.

Importantly, we're bianca season green shoots of better activity from the consumer.

What kind of creatures are we seeing?

The economic data has been quite mixed as of late.

It has, and in the december-february period, weather was a big factor.

When the weather in pizza spending or manufacturing activity, it tends to be activity that is delayed rather than lost forever.

In march we began to see a pickup.

We saw vehicle sales moving back above $16 million.

That is in it portend for him or.

-- that is an important barometer.

The jobs report for march was not great but it was pretty good.

Improved pace of hiring, people coming back into the labor force.

The iss survey picked up in march as well.

Indicators are turning more positive and we will see more of that as 2014 progresses.

The focus for messengers -- the focus for investors will turn to earnings season.

What is your outlook for the first quarter?

Generally, first-quarter earnings will be on the soft

This text has been automatically generated. It may not be 100% accurate.

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