Live from bloomberg headquarters in new york, this is "market makers," with erik schatzker and stephanie ruhle.
Welcome back to "market makers." i am stephanie ruhle.
I am alix steel, and for matt miller, and for erik schatzker.
The world's largest mobilephone company is paying the price for expansion.
China mobile fell 16%. that is due to rising costs to attract new users and to build out high-speed networks.
Beats music, dr.
Dre signed up 1000 paying customers a day in the first month.
Beats was started by dr.
Analysts say streaming music services need at least 5 million paying customers to become profitable.
It does not sound like they are there just yet.
If you have problems getting presents over the holidays, don't blame fedex.
Carriers like his company took the heat for late arrivals.
He says online retailers are guilty of sloppy packaging and not putting labels on correctly.
People who did not get their presence in time for christmas, they are mad at fedex and santa claus.
Executives from google and paypal are in berlin.
So is hans nichols.
Use boat two big names -- you spoke to big names in the business.
Give us the highlights.
The take away is that berlin is not the tech scene that it wants to be.
Namely, it does not have the funders to spread enough money around and to spread it deeply.
On top of that, you have companies where their founders leave too soon.
All of that said, peter thiel said the city has a lot going for it.
It is probably the place where it is most acceptable to try to do something new.
If you say that you are an entrepreneur and you are starting a company, people will not say, why did you fail at your last job, why are you so incompetent or something like that.
You cannot talk tech in berlin without talking edward snowden and the nsa revelations.
Peter thiel is a bit of a libertarian.
He said it would not have a lasting effect, but the main take away on the snowden revelations, incompetence.
People are disturbed about the intrusiveness across the board.
The crazy thing about it is the sense that we are not dealing with a big brother type state with the nsa knowing everything.
It was intrusive, but it was massively competent.
It was on autopilot that simply come -- collected all of the data in the world because it could.
I don't think it did much with it.
The best part about doing an interview, he lapses in and out of german.
You must love that because you go in and out of speaking german.
While he is saying that some of the entrepreneurs are selling too quickly, isn't it tough for us to swallow when you look him -- at the valuation of these companies.
How does a young entrepreneur say it is too soon?
These are huge numbers.
What's apt was focused and they turn down a lot of offers.
They were focused on growing their business.
Another ceo said he talked to too many ceos that want to be bought instead of doing the buying.
There is an idea that you want to have a quick payout and have a quick exit.
Berlin has not had a big ipo.
There is an idea that people are trying to do it for the wrong reasons.
They're trying to build a company to get bought out.
You build a company that is not that valuable.
How many times did whatsapp turned down or rebuffed facebook's offers?
It was good 18 months.
What is going to be the next hot item?
The one i think i am going to use is transfer wide.
It allows you to transfer euros into dollars at very low fees.
I am going to get a berlin makeover.
I want to see it.
What do you call those dresses?
What i am going to wear, it is probably not safe for bloomberg television.
It is a family program.
We are really excited about seeing whatever that outfit is going to be.
Thank you for joining us.
I hope it involves long, blond braids.
I want to see hans nichols, long legs, short skirt, it would look great.
You will need to pay more for margaritas.
Those are fighting words.
Alix steel will have that story when we come back.
If you miss any of our interviews, you can watch them on apple tv.
Bloomberg tv -- it is everywhere.
Stay with us.
? welcome back to "market makers." i like my margaritas on the rock with salt.
Don't forget the lime.
The cost could be on the rise.
Alex bang -- alix is here to break it down for us.
I have some data.
We called some local stores and they range anywhere from four dollars to $11.50. a 4: a reader that is pretty cheap.
-- a $4 margarita, that is pretty cheap.
I don't know if you will pay more for your limes necessarily, but the issue is that the u.s. imports a lot of limes.
Most of that is all used for alcohol.
The majority of the lines come from -- limes come from mexico and the prices are through the roof.
You basically have lime growers creating a monopoly.
They say they're going to control the price to get the price they want and they're restricting their supply.
This is a commodities issue.
I was in whole foods and saw a bag of the cutest limes.
It was $9. that is not that cute anymore.
It already costs about $.44 per pound per line.
It used to be $.31. we are seeing this continued increase as we eat more lines.
Could this spark growers in florida to get back in again?
We are approaching -- what does this mean?
Cinco de mayo is coming up.
They still have to deal with the hurricane issue.
Don't forget, tequila is really tricky.
That i got a plan is fragile.
It takes -- that agave plant is fragile.
Tequila is also very trendy right now.
Bob pitman has his own line of tequila.
Just how much it costs.
$58. for a shot of bob pitman's tequila.
"entourage" -- avione.
Coming up, thank you for the update on limes and tequila.
Cinco de mayo, that is the fifth of may.
When we come back, the hotel chain that has plans for overseas.
It is the one that gives you big chocolate chip cookies when you check-in.
If you have not been there, you're going to want to.
? doubletree is expanding its roots.
It has almost 150 new hotels in the pipeline.
You are in new york as part of this grand expansion plan.
What is it?
We are celebrating cookie care.
The launch of the global program to introduce the chocolate chip cookie to people who may not have sampled one.
What exactly is this?
We are going to 25 cities worldwide to distribute cookies to introduce the spirit of hospitality to people around the world.
It is for people who have not had experience and one of our hotels.
We will be opening 60 hotels this year around the world.
When you say europe, asia, it makes me think it is not a matter of the cookie.
Do people have the money to be vacationing?
Our business is strong.
We are opening hotels around the world.
Turkey, canada, we have open for hotels in australia.
China is our largest growth market.
We are opening in countries around the world.
What is the distinction between business travelers and leisure travelers?
Are they near airports or in the middle of nowhere?
We have locations around the world.
We have city center hotels, hotels of focus on groups.
What is the ratio?
Most of our growth is in the city center hotels.
What is a business traveler while right now?
And experience they can customize and of the people in the hotels can deliver to them.
What does that mean?
They want to know when they check into a double tree that doubletree knows the seven things they like?
If they are a health and honors member, we do.
When a guest checks into our hotel, we focus on the little things.
It requires a different sense of service.
We call a care culture where we are focusing on what you need or want and we listen well and communicate with guests and a way that other hotel chains do not.
It seems increasingly people want to check in and out using their phone, they want to put their preferences on their phones.
We have had e-check in for quite some time.
That is an area we are focusing on.
Social media for us, it is a key way we communicate with our guest.
We promote our brand and we listen to communications from guests while they are in the hotel.
I am hearing personalization.
There is nothing more personal than this -- grace.
The massive number of people that list their homes.
What kind of a risk is it to your business?
When you are staying at a doubletree by hilton, we have core set of standards that can be the same.
You get a little bit more comfort and customization.
With doubletree by hilton, we have no two hotels that are alike.
Staying with us, we will give you that.
The core standard, like the bed and the chocolate chip cookie, it transcends different cultures.
The business center, fitness center, the services that we provide are consistent that can be -- in environments that can be different depending on where you are.
The journal is reporting it could raise enough to value it at $10 million.
That is an enormous growth and valuation.
You have to be thinking about how to compete.
That is one that is very important, getting a lot of publicity now.
We have not seen an effect of that on our business.
It is a different kind of traveler for a different trip purpose.
The focus we have on business transient travelers midweek and then group travelers, predominantly families on the weekends.
It continues to be strong.
What is a cool, new thing you're putting in your hotel?
People like experiences.
They like to sit in the lobby.
They like to work on ipads.
They're not looking to go to their room.
What is the special thing doubletree is offering that is driving customers?
We have a new food and beverage concept that we are testing.
It takes the grab and go concept and puts it in a hotel environment.
We have common tables where people can sit and work.
We have a food and beverage menu open 18 hours a day.
It is a different kind of food and beverage concept that talks to the kind of experience that people can personalize.
If you are there for social purposes or a social trip or with your family, gives you an opportunity to take advantage of a flexible menu.
Even if you are in business travel, going to your room and only having that minibar, that is a downer.
I ate at my hotel every night for a week.
It was pathetic.
I love the cookie concept.
John greenleaf, he is the global head of doubletree by hilton.
The next move for stocks.
We will tell you.
Bloomberg will be going "on the markets." ? that is it for "market makers." we had alix steel talking margaritas.
Hans nichols, his upcoming makeover.
Matt miller joined us.
What are we going to do with jobs?
We are going to speak with the chief market strategist, david zervos.
He gave janet yellen ac minus regarding her comments yesterday.
It is "on the markets." scarlet fu has more.
We are driving in -- diving into derivatives.
Stocks are recovering from a drop sparked by janet yellen's comments yesterday that interest rates may be headed higher sooner rather than later.
What is the read from the options market.
I am joined by the managing director of -- capital.
Talk to us about what the options are.
Volatility has returned.
The vix -- monitor volatility.
Today it is around 15. the longer-term is around 20 on the vix.
Low vix means low level of uncertainty.
Does this move us in the direction of 20? the comments spooked the markets initially.
We have recovered from that today.
Rates will go up at some point.
The market needs to slow down.
Everyone showed up right into their forecast.
What are you seeing in the trading of the sp why and what can it tell us about the next couple of months?
Things will settle down and you will not see a ramp up until later on in the year.
Spdr options are preference to our clients.
It is an active etf for our clients right now.
Lots of the quiddity in the etf.
That helps us.
Exxon mobil, a lot of trading and options of that company.
The underlying stock has been stuck in the mid $90 range for the last five weeks or so.
Why so much action in bullish options?
It can be used as a tracker of oil prices overall.
It is generally quite low.
Bullish call options indicate prices could be at a higher in the near term.
This is a way for people to trade on oil prices without actually having to trade on oil futures.
Let's get to your trades.
The site is trading at a record high.
You think there is a reason for caution.
We do not like to enter new bullish positions.
We like to see a pullback.
The stratagtegy that we have -- is this a stock substitution strategy?
We would like to use it as an income strategy.
We do not like to own the security.
We seek to generate income.
We want -- and all the premium that we receive.
Let's go back to the chart that shows the profit and loss opportunity.
The loss potential is much higher than the profit potential.
The pullback that we might get would allow us to be a seller.
We are willing to accept a degree of loss, but we are bullish on visa over the longer-term.
The risk is a little bit higher if you do.
Thank u so much.
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