Live from bloomberg world headquarters in new york, this is "market makers" with erik schatzker and stephanie ruhle.
Welcome back to "market makers." i'm stephanie ruhle.
Priceline.com disrupted the travel industry when it debuted back in 1997 and today, its founder is out to distract the way we think of medical research.
Jaywalker will be honored at the ceremony.
He joins us now to talk about his new initiative.
Inky for having me.
There are 40,000 medical research labs in america and yet young people have -- they can say is -- they are behind closed doors and the head of the nih has agreed to open up those labs and allow student film makers to come in and film these young scientists.
Any of them women and minorities to create thousands of new role models.
Is a business case?
Is this a nonprofit?
Who's going to pay for this question mark people usually say where is the business.
When you have a really big problem, it's never in isolation.
If you are a large drug company, you are competing against research labs and need to get your best young scientists.
By building a place where everyone can go from private industry as well as nonprofit, you open up a place where recruiting and rewarding young scientists -- i still don't get to pays for it and how you make money with it.
I love the nih but they don't have any money.
It sounds like an amazing idea.
You create the first place where young scientists can go to see what other young scientists are doing.
You then sell the opportunity for commercial companies.
You have thousands and thousands of young scientists to work on nih grants and tens of thousands of scientists who want to work for the public.
Why is it you need to tourneys people into stars today?
Is that because we have created a celebrity culture around business people?
People have been making medical advances yet there was no celebrity culture around jonas auld or louis pasteur.
You've got it exactly.
Young kids today want to grow up and be doctors.
But many people want to write apps on social media.
We need our best students saying medical research.
It is so competitive now, these kids don't even know.
They all think they can be a doctor, but who is going to cure cancer?
Some of the reasons people go to silicon valley is because of the dollars.
They are not going because they want to do really cool stuff, which they may do equally well in a research lab as an incubator in silicon valley.
They just think i'm going to become rich.
There are plenty of kids who say i want to do something useful with my life up teach for america -- the key is if you show these young kids they can be a scientists, especially women and minorities, they say i can grow up and be a doctor, but i could cure that.
It's that idea.
If we don't get these kids thinking about it, we're not going to have the best and brightest.
Don't you want your daughter to do that?
But i worry at the same time that perhaps -- i imagine you've given this some thought.
You could be setting unreasonable expectations.
I spent some time in medical labs and grew up in a doctor's household.
A lot of the research that gets done in medical labs moves along at a very slow pace will stop the world is changing.
With 3-d printers and synthetic biology, the information revolution is coming to biology.
They are not going to move that giant and the slow moving the labs.
All across the country, this idea of slow and plodding labs is yesterday.
The research frontiers and writing dna code and splicing that code into living organisms and working with viruses -- this is a completely different world in these young kids are doing stuff you wouldn't believe.
Why are you so passionate about this?
At the end of the day, america needs to compete with its brainpower and if we don't, we are not going to win in the global economy.
We've got to get our best and brightest working on the stuff that matters.
Lex one of the issues i have is this term with destructive innovation makes people like me feel like you are over the hill.
You're not creative and never had an original thought.
Millenials are shaking up stop albert einstein should get up.
You get these risible investigators that are 35 and 45. they bring the kids along.
Why is it being marketed like it is a new concept?
I'm not in charge of marketing innovator.
I hold 700 because i have props will stop i'm looking for smarter ways to do it.
If you want to call me a disruptor, be my guest.
I'm a person who tries to change things and at the end of the day, business matters but we have to move the country forward.
But america has to compete with its rain power.
Look at what is going on in china.
China has become the second largest spender on medical research.
Look at what's going on in singapore and western europe.
There's an entire generation using technology.
You don't need million-dollar labs.
At the end of the day, we are competing with the whole world.
What is your biggest challenge?
The biggest challenge is to make sure we continue to fund by keeping the funding pressure on in ways that are commercially viable.
Bringing that research to the marketplace and not only get people about the public will.
I am excited about lab tv.
Jaywalker, founder of lab tv and priceline.
I was hoping for jj walker.
Coming up, the housing market is hitting a speed bump.
Buyers and sellers want to blame . if you missed any of our interviews, guess where you can watch them?
And is on and apple tv.
? you are watching "market makers" on bloomberg television.
If you look at the data, there are signs the housing recovery may be faulting.
Home sales plunged last month and by one measure, homebuilders are more pessimistic than they have been in a year.
Bloomberg government senior analyst neil richardson is with us and says washington may be what is standing in the way of a housing recovering.
What do you mean by that?
I think washington is putting the cart before the hearse -- before the horse.
They prove their value in the housing market is slow and looks just like it does now.
And yet, next week, congress will start putting in place a bill that will eliminate freddie and fannie.
That will make a slow housing market even slower.
We all know congress moves really slowly.
Even if they start to debate a bill and even if a bill gets passed, there is no expectation legislation will be passed before the midterms in november.
It's going to be years before fannie and freddie are truly reformed.
Do homebuyers think about that now?
I grant you all of that and it's not just homebuyers.
There's a lot of different pieces that make the mortgage world go round and round.
The key driver of any market is certainty about policy.
Anytime there's uncertainty about policy or its effects, has a drying effect on the market.
It really stops it in its tracks . but we've seen in the latest housing data is a 15% drop month over month and existing home sales down.
Home building and new construction down.
Originations down, i could go on and on.
Some people feel like we are in an economic recovery.
If you look at the market in places like new york and l.a., there hasn't been a pickup -- look at the numbers two or three months from now they will look a lot better.
I agree, but right now, they look bad across the country.
There's pockets in new york, pockets and pockets everywhere.
But if you look at the national picture, you are not seeing the groundswell of growth.
There is about a month to get this bill done before congress are thinking about it term elections.
If the housing market looks sick, and going to kill the momentum.
Has the housing market really proven to be that accurate a reflection -- all markets function on certainty and i just don't know.
He had very strong numbers or stronger numbers, there was certainly growth happening in existing new home sales in 2010 and 2011. i don't think anybody would say those were times of certainty at all.
There were times of certainty about direction of the stock market, wage growth, economic growth, but there was no certainty about any of that.
Accept the place of government and housing.
Government was 90% of the market with freddie, fannie, and ginnie mae.
What the bill does is eliminate the key source of government involvement.
Those are things lenders think about.
Those are things policy makers and movers and shakers in corporate america think about but if i'm going to buy a house, i'm not thinking about the certainty.
I'm thinking about whether i've got enough to make a down payment and whether i can get a loan from the bank.
I'm also thinking about the cost of the property.
Mortgage rates are higher, higher than they were one year ago.
But more than anything else, things are more expensive.
Maybe much higher hoppity prices is what is to blame for the flows -- the slow sales.
Lex i don't think it is about rates at all.
What is the problem is credit availability has not come forth.
43% of the market is all cash hires.
First-time homebuyers are having a hard time getting mortgages.
You may be able to get a mortgage right now at the price point you want to a lot of people can't will stop you are right, but then we can get into a debate whether that's a bad day.
You could make the argument we had too much homeownership will stop in 2005 and 2006, think about all the people who are out there buying homes because they were under this arnie frank idea that it's part of one's birthright to buy a home and maybe it shouldn't be.
Maybe renting is a-ok if you can't afford it.
Absolutely, but here is where the policy comes in.
What's shown in 2005 at 2007 is that the private market could own housing whenever it wants to.
It can make freddie and fannie be relevant stop -- fannie and freddie irrelevant.
That is when fannie and freddie show up and prove their value and that's what they are doing now.
The private market has backed away, the government is here to stay.
The trick policy wise is to get freddie and fannie to shrink in good times and allow the private market to come back.
That is the heart art.
A good conversation as always.
Neil or richardson, senior economist at bloomer government.
-- at bloomberg government.
? shutter stock has a brand-new and very fitting address them.
They just moved into one of manhattan's's most photographed landmarks, the empire state building.
I went inside their new office to see how the high tech fit into the iconic building.
Welcome to shutter stock headquarters, home of one of the world are just digital stock photo libraries.
Located on the 20th and 21st floors of the empire state building.
Shutter stock brings a startup vibe to an old school building.
This is the alice in wonderland room.
Ask are you kidding me?
Its office as free food, a massage room, a secret library and to unbelievable game rooms.
Rex we get -- we get so much done here, but we like to have fun also.
Shutter stock was started 11 years ago when he took the company public in 2012 and is known as the first billionaire to come out of new york city's growing tech scene.
New york is the business center of the world.
By being here, it allows us to react biggest media agencies in the world.
That's important to us.
300 employees work in shutter stock's new headquarters but remote employees have a presence in the new office also.
Rex -- this belongs to a remote employees inside here somewhere.
He can control this from where he is and work with people in the office.
Shutter stock's team voted on conference room names and food choices, but big data determine the office layout.
Rex we looked and found out conference rooms were used by two to five people, so we decided to create a lot of smaller ones to accommodate that.
Building the office is a snapshot of a much bigger picture for snapshot.
Let me tell you how amazing that robot is.
You are sitting there doing your work and your colleague from minneapolis, brian, walks up and is in your face like a little robot.
It's eerie cool.
-- it's a very cool.
I asked ryan from minneapolis why he didn't work in new york.
He has seven kids.
There you go, shutter stock and the empire state building.
This is "market makers." ? that is it for "market makers." it was a great day but i have a feeling tomorrow will be better.
But we will talk to the top media banker at blackstone, peter cohen.
Now we're going to send you out to the newsroom where matt miller is going to take you on the markets.
You know what time it is.
Check out the markets.
Stocks rising as much as you would have maybe thought from the earnings picture due to tensions in ukraine overshadowing the strong corporate performance this morning.
We are still seeing gains across the board there.
Joining me with today's options inside is the chief investment officer joining us from the cme.
Tell me what you think about this overall market.
I came in with a traitor today who expected the top to blow off and it's not very exciting.
I think the most hated market of all time is what we are witnessing right now and the market is hopelessly resigned to residing between 1840 and 1880 until further notice.
Deeply fascinating, not just looking at the volatility of the s&p 500 but other asset class volatility.
All of them are grinding toward the bottom and seems like right now we are in a very apathetic market and just waiting for the next move and no one knows what will cause the catalyst to grind as higher or lower.
You say grinding and some it's a gold futures are rallying.
It's a very low bar from a 10 week low.
Where do you think we are going to see gold moving going forward?
I am still very bearish on gold and the overlying element to that is that the normalization of monetary policy around the world is going to act as a cross over gold pots head.
It's going to be really hard for gold to rally.
There's no concern for a wind down of tv, especially since it might cause credit breaking.
There's a premium for asia in gold and tells me there's a lot of supply will stop and at india.
I don't think it's in any rush to relax the him rotation policies they introduced last year.
I just can't see gold going any higher.
I think $1200 makes a lot of sense by the end of the year.
That is your take on the trade?
I like gld because implied volatility is very low right now.
Take advantage of low volatility and bias.
I'm looking at december -- you have seven months to play with it will stop the 120-100 put spread.
You can buy it for under four dollars.
You need a 6.5% on moved to break even on this trade.
That case scenario, gold drops 15% or 20% and you have cashed in and you are risking four dollars to make a net of 16. i think that's a good way when you look at implied volatility.
Rex one reason people are excited this morning was apple's earnings last night.
They announced an increase to the stock buyback and dividend program.
What type of action are you seeing in the stock?
Uc see implied volatility drop quite precipitately will stop -- precipitously.
Puts increased quite a bit and people were very bearish.
What not to like about the report let's might?
Increased dividend and the seven point stock split.
He put skews relaxed and implied volatility down.
I love what happened yesterday but i have cautioned over and over again -- i would buy the stock or by put spread against the old stop -- and by put spread against it.
I've stay hedged against apple.
Rex enck you for joining us.
We are on the markets again in
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