Media moguls and rub elbows and on ballet and google is on the menu but will they be willing and dealing?
He's catskills -- former aol chief steve case on immigration reform.
Read between the lines -- barnes and noble may have a spin off while maxim goes all -- goes up for sale.
From bloomberg world headquarters in new york, this is "in the loop." good morning, it is wednesday, july 10 and we are live from bloomberg world headquarters.
We've got all the top stories.
Peter kotok is watching house republicans as they meet today to weigh in on the fate of immigration reform.
John ehrlichman as of early in sun valley, idaho where the media and tech giants could be making some deals and dominick chu has the run down of everything investors need to know and some big earnings out after the bell.
Chairman ben bernanke will be very much in focus today.
The macro big picture trade is what is driving a lot of what is happening despite the fact we are getting into the heart of micro economic or earnings season.
Stock futures are really not changed and head of the fed minutes come out this afternoon.
Today at 2:00 p.m. eastern is when we will get the fed minutes from their june meeting.
This will give us some indication of how much talk there was of tapering and may be an indication of when they will raise interest rates in the future.
Later on this afternoon, ben bernanke himself will be speaking in cambridge, mass.
At 4:00 this afternoon.
He is speaking at the national bureau of economic research and he will take questions.
That is the reason why those guys are in focus and we get a big 10-year note treasury auction with yields near their highest in two years and we will be selling $21 billion of those benchmark securities and we will see if demand is good.
Yesterday demand was good for the three-year note.
Which got a big branch report after the bell, yum brands?
It is more about was happening internationally if especially in places like china.
We have seen the stock to a nice run up here, about 15% over the past year.
We will key in to what is happening with their numbers of that demand in china and same store sales, any indication of what growth will be internationally for the score -- this food company.
There are a lot of big names in international food under their umbrella, thank you.
In washington, it is a big day for house republicans and immigration where they will meet behind closed doors to decide how to handle the issue at this out -- after the senate passed its own bipartisan bill and peter cook has more on these options.
Speaker john boehner still wants a bill this year.
That is what he is saying.
He told us that a couple of weeks ago.
What is the solution to immigration reform for republicans and how many house republicans will go along with john boehner?
He insists he will not take the senate bill and bring it to the house floor in part because there is one component of that legislation that is too toxic and that is the pathway to citizenship.
The options for him now is if they move piecemeal legislation to the house floor or put their own bill together?
We all believe that if we are going to go forward on immigration reform, the first big step is you have to have a serious border security.
Without serious border security, it is the same thing after we sought the 1986 act.
He outlined some of the options and will hear from members today behind closed doors.
You've also got the obama administration turning up the heat of house republicans, releasing a ream of economic numbers showing that immigration law reform will help the u.s. economy.
What happened to the bipartisan group in the house that was working on its own bill?
They say they are still working on their bill.
They met recently with mario diaz belart.
They say they are still working on the legislation.
They could be crucial when it comes to dealing with this issue about a pathway to citizenship.
If the bipartisan group can come up with language that satisfies both, maybe john boehner and the republican leadership would consider adding that to their legislation.
We will have more in emigration coverage would steve case.
He has been meeting with the president about how to bring and create opportunities with skilled workers.
He will join us exclusively in the next hour.
Our mover and shaker this hour is tim cook.
He celebrates the fifth birthday of the app store.
It has grown from offering 500 qapps tp now more than 900 apps over the last five years.
It has been a launching pad for software developers and companies big and small to debut there apps.
What have the most popular ones been?
You guessed it, number one is angry birds, followed by nihjas, and an netflix is the third most popular.
Media and attacked mobil's like tim cook are gathering this week at the annual allen and company conference in sun valley, idaho.
These guys love a good deal and this year's focus is on streaming service, hulu.
Jon erlichman takes a look.
A breathtaking backdrop, perfectly groomed golf courses, and the boat load of tech and media moguls.
Allen and companies annual conference in sun valley, idaho may be the perfect place for billionaires' if you do business and this year, much of the deal buzz surrounds hulu.
It will be the thing everyone will talk about.
In the driver's seat is rupert murdoch and bob eiger.
Their companies are the hulu controlling shareholder is pretty interesting bidders include directv.
Mike white is often spotted at sun valley and this is not a hot -- first-time hulu was a hot topic.
It was up for grabs two years ago before its owners decided not to sell.
It came down to what rupert murdoch and bob eiger think.
If they can act in a deal done, the moguls to work on their golf gains.
They can do all that in sun valley.
You have been there already for a few days.
What have you learned more details about the bid for hulu?
A real bids for hulu had to be in last week.
Directv made a bid and so did at&t in combination with peter chernin through his company.
Time warner bid for a stake and guggenheim digital media team up with kkr.
They were basically told they will go with a more strategic investor and that is telling.
The owners of hulu want to make sure that the content they are selling to these other players is in the right hands as we try to figure out where the media world is going.
Pay tv players i think is the name of the.
What has been the bid action?
It is next.
If you speak to any of the players, they say britain and on.
-- they say bring it on.
One better setting up -- one stockholders said he would be glad to see a new honor.
There are long-term partnerships with netflix and that might open opportunity to do more deals.
Every year at this conference, they have something these moguls like to wear like a red vest one-year -- do you know what it is this year?
The ceo of sunni was wearing a red vest.
Maybe it is sneakers.
They are not giving away sneakers but tim cook and nt q were wearing nikes and the attendees are getting younger and younger and they wear a fluorescent shoes and that puts pressure on the media guys who were the fancy loafers.
Better fluorescent shoes than fluorescent pants are something like that.
I will keep you posted.
I want to know about that, thank you.
Coming up, the former ceo of random house ways and on barnes and noble and whether the bookseller as a chance to survive in one piece.
The women of maxim magazine may not be the -- enough to wet they give buyers but it is up for sale at a discount.
These are not soccer hooligans, they are protesters.
We will tell you why they are up in arms over the sports ties to one of the richest and perhaps most hated man in brazil.
? captioned by the national captioning institute --www.ncicap.org-- ? you are watching "in the loop,"streaming on your phone, your tablet, and bloomberg.com.
Keep your eye on barnes and noble.
William wench to help them move into the digital market is out as the ceo.
Barnes and noble has been losing its e-book battle quite a long time and this question is whether the company will split up its business and return to basics.
Joining me now is peter olson, the former chairman and ceo of random house, the world's largest consumer book publisher and now the co-founder and ceo of the fullbridge school which is a training for college graduates entering the workforce.
Let's talk about barnes and noble and whether it should be split or that is the path.
The textbook business and consumer book business are fundamentally different businesses.
They're different products and different reading experience in different demographics.
They should never have been combined.
You expect those two to be split up?
The value now for barnes and noble is on the textbooks side.
Did they do with the consumer books sides?
Because amazon has won this war is whether they can survive by offering additional experiences for readers.
Many discounts and bundling -- something to match the all in one place shopping that amazon offers.
What do you mean by discounts and bundling?
Amazon offers discounts so what would barnes and noble bring that could be different?
Many readers go to barnes and noble to browse and then purchase for 30% less than amazon.
They have loyal readers who, if they were offered really attractive volume discount programs, loyalty programs, the opportunity to bundle the digital version and the print version, might be attracted -- buy an e-book and get a regular book free?
What would you expect them to do on the textbooks side?
Is that more profitable?
The textbook business is in trouble but it is a death spiral with different trajectory.
When william lynch came in, he wanted to transform barnes and noble and talked about it being not a bookstore chain but a technology company.
Was he wrong about that?
I think the idea of trying to compete with devices was a distraction.
It got bonds and noble away from their fundamental advantage.
They are a great destination place to browse and look at books.
They need to build on that.
How could they have not gotten into tablets seeing what was going on with the ipad and the kindle?
They should be a gateway to other devices and not try to have their own device.
Since you are a former publisher, how are they seeing this demise of barnes and noble?
They have already watched borders go into bankruptcy.
How're they looking at barnes and noble in terms of where they will sell their books?
Publishers should be concerned about the possible loss of barnes and noble as a customer because it makes amazon that much more powerful.
They will be stronger at negotiating discounts.
We are talking about maybe half the stores could be closed?
Half or more in the near future.
Where did these publishers go?
What leverage do they have?
Key for big publishers like random house will be developing a special relationship with amazon.
Amazon has won this game and i need to have a closer relationship, a better way of promoting their books effectively through amazon.
Tell me about william lynch and him being ousted as the ceo of barnes and noble.
Who should come in now?
I think len riggio should look for someone who knows books and on-line retailing and i would look for a top executive at amazon.
Thank you so much for joining us.
Coming up, doesn't it seem like summer just started?
It is time to start thinking about back-to-school.
We will talk with the head of staples north america in a moment.
Wait until you see the latest edition of one of the most popular video gains ever.
We will tell you about added features.
At noon, tune in to my radio program.
Howell oilwell apple shares codex brian marshall of isi group will join us and what tim cook may have up his sleeve at the sun valley conference.
Time for this vs that where we look at a store with two very different sized but we are talking about guns, drugs, and action of the virtual variety.
This is rock stars "grand theft auto iv" allows people to wander around the city to become the kingpin of the fictitious world.
That is a trailer for "grand theft auto v." gamers switch between three main characters and invest their money in stocks and real estate.
If roaming the streets it's boring, players can go golfing, cycling, based jumping between missions.
That sounds like fun.
Coming up, readers boded jennifer love peewit maxim's must cover girl but there has been little financial love for the owner and he is trying to sell the magazine.
Brazil paz big fight against one of its own, a billionaire really going for the gold in the next summer olympics.
We will tell you why these protesters are not on board with his plan.
? you are watching "in the loop,"streaming on your phone, your tablet, and bloomberg.com.
Investigators have gotten their first chance to talk to the pilot of the asiana jetliner that crashed over the weekend.
The pilot thought they had set the correct speed and did not realize they were going to slow until seconds before the crash.
Stricter capital regulations may force u.s. bank to hold onto earnings rather than boosting their dividends.
If regulators are proposing the biggest banks of have to retain capital equal to 5% of their assets which goes beyond new international rules designed to prevent a repeat of the 2008 financial crisis.
The nation's second-biggest dollar store, family dollar reported third quarter earnings that beat estimates for the chain cut its forecast for the fourth quarter and shares of family dollar if are up almost 3% in pre-market trade.
In media news, we've got details behind a spin off just announced this morning tribune will separate its publishing and broadcasting operations.
Scarlet fu joins us with more.
Beat estimates for they were trying to sell the newspapers but perhaps they do not have a buyer or one with a price they are willing to disclose.
A private equity firm is looking to buy things at distressed prices but they probably submitted lowball bids.
Tribune is now separating the utility part of its business.
I have eight newspapers including "the l.a. times "the chicago tribune.
We checked in with michael wolff, a noted media columnist and this is what he said.
The tribune company has two legs, a broadcast legged newspaper leg.
By getting rid of the newspapers, pushing them out, the broadcast leg is immediately stronger.
Earlier this month, tribune shelled out about $2.7 billion to beef up its tv stations and its 19 different stages.
Tribune says it is going to have two tribune companies that would have revenue of about $1 billion.
The separation plan will be fleshed out over the next 9-12 maastricht this is a tried and true playbook because news corp.
Split up its holdings.
They could not find a buyer for their magazine business.
People are asking if gannett is the next to employ this spinoff proposal after it purchased belo.
Talking about the publishing business, how much is the ultimate guy's guide worth?
It turns out not very much.
Maxxam is still one of the largest men's magazines in circulation and is selling for 1/10 of what its owners paid six years ago.
Cristina alesci has more.
They have a formula that sells so why can't they get a good price?
It challenges the conventional wisdom that all you need is have naked women to sell ads.
Let's look at the numbers.
Annual ad sales have dropped 18%. when you look at on a quarter over quarter basis, it would be 45% drop and this comes down to the lack of investment from its owners.
Private equity bought this company back in 2007 at the top of the market and gave up on it two years later and stopped making debt payments to creditors have gotten control over it and that has stifled their ability to capitalize on digital.
Magazines that are making an impact and surviving and potentially out there to stay are the ones really capitalizing on the digital audience.
If you go to the maxim website, it looks more like a blog post.
Lack of investment and perhaps a new owner could turn that around but it will take time.
Are talking about a $20 million pricetag, i would think they should just put the photos on their website and they would have a bunch of clicks.
The archive is probably worth something about who is the likely buyer for this company?
One of the companies out there we thought would be a likely buyer is american media which owns the men and women's fitness when magazines and have a partnership with playboy.
I am being told that they're probably not that interested.
We are learning that bids have come in on this company.
We could see a deal as early as next week.
Who is going to have the stomach to buy it.
You need to put some money behind this brand of you wanted to continue.
If they cannot do this or get a deal they like, what is next?
They will get a deal done.
No one doubts that.
It is still one of the largest men's magazines in circulation.
There is power in the brand.
Someone will pay something for it.
It will not be much in the way of a price tag.
Coming up, where up -- or america's banks able to cut their way to higher profits?
We will find out this week when bank earnings start rolling in and in sports, the rich get richer.
The nba will lead to spend more money on players next season.
? jpmorgan c.e. o jamie dimon is back and focus this week as the bank gets set to report earnings on friday.
They are largely expected to report higher earnings as cost cuts make up for weaker revenue.
Hedge fund manager tom brown only invests in financials.
He recently met with jamie dimon to discuss the businesses and capital regulations.
If he is with me now to share.
Nice to see you.
Tell me what was the tone the conversation.
It is always fun because he is entertaining and straight to the point.
One of the biggest takeaways was that we will get to what ever minimum capital leve is required and we're not going above that.
We will get to the minimum and build in a buffer and then we will pay out the rest in terms of debt -- dividends and buy back stocks that isn't that what most banks will do?
No, other ceo's are a little when they said they will let their capital holdings drift higher.
Jamie dimon says this is too much already.
Whatever the minimum is coming says we will build a cushion on that by maybe 50 basis points and that's it and we will pay out the rest of our shareholders.
Does he feel he proved his point with the london will fiasco?
-- whale fiasco?
We all look at the banks and the capital and say it is too much.
The large banks fail because of liquidity.
We should spend 90% of our time focused on liquidity for them and 10% on capital.
Qwest -- you mean access to liquidity.
We talk about adequate capital measures and it should be reversed.
What do you expect out of the banks this earnings season?
I expect good results and we will kick off friday with jpmorgan and wells fargo, two of the best high performing banks and they will be good.
It will not be strong net interest income growth.
It may be down again this quarter.
It will be good expense management and good credit quality costs.
We had a conversation with jim reynolds co is the ceo of lopp capital and spent many years on trading desk spurred we talked about the banking profits.
This is what he said -- ipo issuances are really strong this year which is really where they make a lot of money.
It is 5-7 points and we are seeing m&a activity in north america up, too.
They also make money there.
Trading revenue is important but you'll probably see less -- less trading impact a more corporate issuance impact until the last few weeks but also strong input from m&a and i.p.o.'s. would you agree with that?
No, i don't know where he sees the m&a activity but i wish it would happen.
We have seen some good underwriting activity.
We have seen some good trading results in the second quarter versus one year ago.
The second quarter will be down versus the first quarter.
It always is.
It has become seasonal that way.
It has not always been that way but that is the way it has been lately.
I expect we will see a activity.
Pickup in m&a activity in why?
There is an excess of capital and confidence has got to come back to corporate america.
They will say i will use this cash in capital and expand my business.
I hear that confidence has to come back but where did the confidence come from?
Is it from the economic data we will get in the next few months?
The two sources would be the economic data and the other source with the congress.
"our congress get together and pass something the president would sign -- what are you talking about?
And talking about regulation or the budget.
Some major piece of legislation that would give confidence the country has got itself together and is headed in the right direction.
People have been talking about the backup in yields the latter part of this year.
In treasuries and the fed coming off of qe and tapering as soon as september.
How big an impact will that have on banks?
It has a dual impact.
Rising rates will be good for net interest margins, good for net interest income.
Rising rates will cause the value of the securities to go down and that will be tough for capital.
From an income statement standpoint, the rising rates will be very good for the u.s. banking industry but from a capital standpoint, not so good.
Which will be more important?
The industry is so over- capitalized.
The industry has plenty of capital.
The capital returned story is what you will hear from banks and next five years.
Would you buy into more regional banks?
Or would you buy into like a wells fargo in anticipation of rising interest rates?
That has been going on.
The regional banks that are sensitive to rising interest rates, they see their stock prices are rising.
Now is the time to get it to those banks that you will be talking about -- talking to some of these bankers.
You will talk to banks in that -- nevada, ohio, and oregon with the bankers association meeting tomorrow.
They want to know about capital.
They've asked me to come speak to them about what is going on with capital regulation and what they expect the banks to do, the bigger banks to do, with regard to capital.
Why don't to they know already?
We don't even know the final capital standards.
What they would like to hear is the big banks will raise loan prices and that would be the umbrella that allows them to raise loan prices.
Great to see you, tom brown.
Coming up, the annual migration of media moguls to sun valley so what deals will come out of this year's conference?
We will take go look add billions that are at stake.
We will explain over the low profile billionaire making a fortune from the summer olympics at the expense of brazilian taxpayers.
? millions poured into streets of brazil last month in violent protests.
Their issue is the national government's decision to finance our arenas for the world cup and the 2016 olympics at the expense of taxpayers.
The majority of the emerging market is feeling the squeeze.
The building boom has interest a handful of lives including cesar masa perez.
We have more on the newly minted million millionaire.
He has been the target of some pretty strong protests.
Why is that?
Perez founded a company called oas has emerged as one of the biggest winners in the construction bom leading up to the world cup and the olympics in 2016. the name of his company, oas, has appeared on protest placards.
What people are upset about basically is that the government is offering subsidized loans to his company to build these stadiums and they think that money would be better spent on health care, education, and public transportation.
What has he and the company said in reaction to the protests?
He did not talk to us.
He is extremely low price fall -- a low-profile and avoids the public at any cost and we had a long meeting with his director of public finance.
He called the protesters linking of oas to government waste simplistic and ignorant.
His feeling is that oa iss participating legitimately in the only existing business model in brazil.
What does that mean?
Basically, the brazilian government needs to construct these big, large-scale infrastructure projects for the only companies available to do it our companies like oas and a handful of other family-owned companies.
The way they intend to get these companies to build these projects is for subsidized loans.
You mentioned he is a very private person.
What little do we know about him?
We know he was born in the northeastern city of salvador in 1950. he started a construction firm there.
It drew the attention of the governor at the time, a man named acm who was one of the most important power brokers in the second half of the 20th country and he married the daughter of acm and, as acm rose as a politician during the military dictatorship and after, rising to be in congress, he pushed a lot of business towards mata pires.
He lives in sao paulo today as grooming his two sons to one day take over the company.
He is a very private and avoid the press so know very little about him that i can imagine trying to stay more private given what has been going on.
Thank you for joining us.
For more on this story and track the world's richest, go to bloomberg.com billionaires'. basketball stars are jumping for joy over today's bloomberg big number which is $58.7 million.
That is the new salary cap for nba teams.
The minimum team salary which is set at 90% of the cat stands just under $53 million.
This decision comes as a moratorium on clubs' signing free agents expired at midnight last night.
In other words, if teams are cleared to play full-court press on these players.
Coming up, american companies may post some of their weakest earnings in four years.
This summer, it seems like back- to-school sales began a few days after the kids get out of school and we will talk to staples about how they are poised to profit from this.
? the dollar has been dominant but it may be at the cost of corporate america.
Earnings season kicks off with alcoa but there is pessimism in the air and you can blame that on the dollar.
U.s. companies are set to post some of the weakest quarterly results in four years?
Yes, blamed the dollar at least in part.
It has been strengthening.
It is on a roll, one of the best performing currencies so far this year.
If you are procter and gamble selling toothpaste and france or in japan, it is worth a lot less when you are bringing home last euros or yen and convert them into dollars.
Companies have been fighting the weakness in local currencies.
Apple has raised the price of ipad and ipod in japan to help cushion the blow of a weaker yen.
It is still starting to hurt.
If you take out all the financial companies and look at the standard and poor's 500, earnings are set to decline 1% this quarter, the second worst performance since the financial crisis brought a lot of analysts say they are citing a stronger dollar as the reason.
It is not just the yen, the dollar has been stronger against major currencies?
It is dollar strength across the board.
If you look of the most widely traded currencies, the dollar is stronger against all of them this year.
This was a hit for consumer- products companies and.
And blackberry cited the venezuelan currency as a reason for lower sales and earnings.
The bad news for corporate treasurers is the dollar is projected to keep strengthening as the federal reserve looks at tightening are tapering.
Coming up in the next hour, he helped put a l l on line and runs a venture capital team, steve case will join us in the next hour.
? welcome back.
Equity futures are little changed as we head towards opening bell.
Momentum has been towards the downside great . family dollar reports third quarter results early this morning, beating estimates.
We are watching the latest with the agn a flight incident.
-- asiana inciident.
Let's get straight to the markets.
Cristina alesci kicks it off.
I'm watching tribune, the publisher of the "los angeles times." the company plans to spinoff its newspaper to a separate business.
I'm taking a look at cliffs natural resources.
It's ceo said he was going to retire by the end of the year.
There's also some other management changes.
Analysts say this could open up strategic opportunities for the struggling company.
They sell skincare products, nutritional supplements.
There shares are up sharply after they come out with preliminary sales and profits better than forecasted.
Thank you so much.
It is a busy week in sun valley, idaho.
Danny will allen and company conference -- the annual allen and company concerts -- conference gets underway.
Jon erlichman joins us live from sun valley.
You had a chance to chat with the espn boss about this.
What do you have to say about all this competition?
This is a really big deal.
Fox is trying to take a page out of the espn playbook.
It's all sports channels going to be launching on august 17. they have been getting the word out to all advertisers and are hoping the cable companies will want to pay the kind of fees that espn is able to generate through its channel, which are enormous.
John skipper taking it all in stride.
When it comes to august and september, they could have special programming.
The other thing they did not talk about is how espn is going everywhere through technology.
The watch espn app is now available on apple tv.
One of the apple executives is here at sun valley.
We talked a little bit with john skipper about how the apple tv deal came together.
There has been generally a pretty good working relationship between apple and espn.
We were on the first ipad.
We had applications there.
I know you're talking about sports media and sports networks, but there's also people from professional sports there.
I just saw john henry of the boston red sox going into one of the morning sessions.
Build the width, who owns cardinals.
And then all the commissioners -- bill dewitt, who owns the cardinals.
And then all the commissioners.
When it comes to media, sports content is king.
Live programming, the very strong selling content that more and more people want to read you have seen more and more big players from the sports industry showing up here.
Thank you so much.
Jon erlichman in sun valley.
Stay tuned for full coverage of the sun valley conference.
The world's largest ad agency will be joining us at 8:00 eastern time on friday only on bloomberg television.
Our mover and shaker this morning is carl icahn, the billionaire investor had some words of advice for dell shareholders.
He said, get an appraisal.
Icahn said he believes a $13.16 a share substantially undervalues the stock.
He goes on to say that if dell stockholders get an appraisal, they will receive more.
The letter comes as the deadline for dell investors decide which offer they like best.
The shareholders' vote is set for july 18. now we turn to a nemesis, bill ackman.
He told investors he was looking to raise money for a new fund that will invest in a large u.s. company.
There's a lot of speculation that that one company in particular could be fed ex.
Dominic chu has more on ackman.
The case is raging on.
There's a lot of speculation.
There are a number of clues that cute investors into thinking that fedex might be the object of ackman's affection.
He wanted to be simple and predictable.
He wants high barriers to entry, and substantial pricing power.
Fedex might fit some of these qualities, that others up in the air.
Two of the biggest question marks here, substantial pricing power and switching costs.
Fedex has very little pricing power, and switching to a rival could be quite easy.
At this point, both ackman and fedex have declined to comment.
This is speculation.
What are the analysts saying?
We spoke to a number of them who said they see key indicators.
Fedex looks cheap.
It trades at a 15% discount.
Analysts are looking for those key positives in the fedex story.
Fedex is gaining market share in ground and freight.
Fedex is cutting its transpacific route incrementally, which should help their margin on those flights.
Air flight -- air freight trends are starting to stabilize.
One bullish factor is technology.
All of the iphones, ipads, android devices are getting smaller.
High-tech shipments about a quarter of all international air freight activity.
The more those gears and gadgets are shipped, the more fedex might rise.
I would be a big company to take on.
Thank you, dom.
Many find little time to escape the office for lunch here in new york.
There is a new player in town.
You may have their app on your phone.
Yelp has just added food delivery through their new platform.
Julie hyman joins us now.
You are a user, i believe, of seamless.
If you go onto yelp now and you are looking at a review of a various restaurant, for some of them and you will be able to see a button that, would you like to order now?
You click on it and it takes you to two cites the yelp is partnering with.
Eat 24, and delivery.com.
Delivery.com's network is 10,000 restaurants in 60 major cities.
It is not that yelp is embedding the platform on its own website, it is helping link to these other sites.
Essentially helping to not just give those reviews that you get on yelp, but also to extend that process to folks being able to actually order food.
Yelp is not going to stop there.
The company is slowly rolling out restaurants in new york and san francisco and will expand it to the full complement of those that eat 24 and delivery.com offer.
It is planning to eventually offer booking services for all the other reviews it has, at things like salons, for example.
That is the endgame.
Analysts say this is in an effort to increase the yelp brand, increase engagement on the part of its users, and improve the experience overall . not having to migrate away to make those reservations or order food at restaurants.
Isn't also going to help yelp raise ad rates for the company?
Brian blair said that ad rates will not necessarily go higher, but it's a matter of making it more attractive to advertisers.
Maybe it will get more advertisers.
It is collecting a fee every time it gets that feed through on the food delivery services.
When someone clicks on that button, yelp is collecting a fee, which at this point it is not disclosing.
Seamless and grub hub, which are merging -- if you're curious about the numbers, grub hub has 20,000 delivery relationships.
Seamless has 12,000. it looks like this is comparable in terms of numbers.
Thank you, julie hyman , our senior markets correspondent.
Coming up, a very special guest guest.
Aol cofounder and venture capitalist.
House republicans meet behind closed doors.
Case law being -- case lobbying on a plan for high-skilled workers.
Shopping season is already beginning.
? you're watching "in the loop." it is time for the call.
Finance investor jeremy siegel joining us.
He says a 3% yield on a 10-year note, that would take a bite out of the stock market rally.
Jeremy is also said to watch out for dow 16,000 this year.
It's great to have you this year -- back with us here.
Let's start with this: treasuries.
Why would 3% yield or above the bad for stocks -- the bad for stocks?
Investors have to get used to the fact that interest rates are going up.
They will as long as they're not going up too quickly.
If rates can stay around the 275 for the 10-year, i think we are hitting new highs on the averages.
If it suddenly went up to 3%, that would be a little bit much to swallow right away.
In three months, if the economy improves, if earnings go up, investors could take 3%. it cannot go up too quickly.
If it stays on 275 -- we have a great market over the next two or three weeks.
That bond volatility is what julie is looking at.
Adam johnson i talked to the chief global strategist at wieden.
He is looking at volatility in stocks and bonds and the relationship between them.
Usually they move in tandem, sometimes they don't. he says we are coming out of a time when they did not move in tandem, but he says we have seen a lot of bond volatility, increasing stock volatility will follow.
He says it will be a tough summer for investors.
That's a good point.
Professor, you're saying it would be good to have a slow and steady ride but it sounds like you're going to see this volatility for quite some time.
What's really interesting is when bad news hit on the stock market, people ran to treasuries.
Now treasuries and stocks are moving more in tandem, which reduces the attractiveness of treasury as a hedging asset.
My feeling is, treasuries are going to be a problem.
But where are people going to go?
We see bonds.
Stocks are still the asset of choice for investors today.
For investors today in particular, they're going to be watching the fed minutes that will be released later this afternoon.
That is something that dom is looking at.
Is not just the fed minutes.
This is from their june meeting.
Were going to look for any fines or commentary -- finds or commentary about tapering.
Investors want to see if there is any indication they may raise rates any time soon.
Bernanke is speaking later this afternoon at 4:10 in cambridge, massachusetts.
What's he going to say there?
We are all wondering.
Professor, could we get any further clues on raising rates?
I think raising rates are way in the future.
The figure there is 6.5% unemployment, which they don't expect to reach until the middle of 2015. i don't think that's going to be an issue.
Tapering is an issue.
September, the taper begins is paid into the market here it -- baked into the market.
It is the first time the fomc has said to bernanke, go out there and make some announcement.
We're not making the statement, 7% unemployment.
Thank you for joining us, professor per jeremy siegel.
T-mobile adding customers for the first time in three years.
? you're watching "in the loop" live on bloomberg television and streaming on your tablet, your phone, and bloomberg.com.
We are about eight minutes away from the opening bell on this wednesday.
Futures are mixed right now.
It is time for the countdown blitz.
Dominic chu is here with me.
Let's start with ubs.
It's growing in wealth management, according to a new study from london-based researcher scorpio.
The study looked at results for more than 200 firms from all over the world.
Korean stocks look attractive.
The management team at j.p. morgan asset management is starting to buy.
The mst i korea index lost over 7% last month.
Let's round out our global look.
A check on italian carmaker fiat , threatened to move production of their all for romeo cars out of italy.
-- alpha romeo cars out of italy.
The ceo says that the relaunch of alpha rom eo will happen for sure and italy has to decide if they wanted to happen there.
It is part of a big plan of yet -- fiat.
Beautiful cars, but not made in italy?
[laughter] what are the options?
Fiat has global manufacturing facilities.
They majority-owned chrysler here in the u.s.. dom, thank you.
We are just a few minutes away from the opening bell.
Have closed mixed.
? welcome back.
Our market team is ready to take up through the bell.
Dominic chu and julie hyman are here.
It is time for the top 10, the only traits you need to know about today.
Number 10, citigroup.
Loberg has learned hard it may be due to the plan to cut -- bluebird has learned it be due to the plan to cut costs.
From banking to the number nine spot, t-mobile usa.
It added customers for the first time in three years, a key milestone in its turnaround plan.
Be sure to catch the ceo on bloomberg west tonight, 6:00 p.m. eastern.
Number eight, hewlett- packard.
Cindy says -- number seven is walter energy.
The company's strengthening position.
Number six is nu skin, earnings coming in at one dollar $.20, well above analyst estimates of $.96 per share.
The final numbers will be announced on the first of next month.
Number five, family dollar.
Trading lower in the premarket after reported third-quarter earnings that beat estimates.
Family dollar cut its forecast for the fourth quarter.
Consumer sentiment climbs to a five-year high.
Number four, tribune, the media company, try to spin off its media publishing business . allowing to focus on its more profitable local television business.
Number three is zynga, the online game maker gambling on a new strategy, creating real money betting applications for facebook.
This announcement comes two days after a shakeup.
Number two, cliff natural resources, saying goodbye to joseph corroborate he's retiring by the end of the year.
-- joseph carrabba.
He's retiring by the end of the year.
Number one is fedex.
All the speculation that it may be the next target for activist investor bill ackman.
There is no confirmation that the $1 billion ackman set aside is actually for fedex.
Joining us from chicago . we'll will start with you, glenn.
We been talking about the fed and minutes coming out at 2:00 p.m. will that be important for the market?
I think it will be important for the market.
We have seen stronger earnings and employment rate we have moved temporary to -- tapering to september 13. would you agree?
I agree 100%. the last fed meeting occurred, what the fed told us is when we see better economic moves we will stop dropping of the market.
-- propping up the market.
The market dropped drastically and has risen drastically.
The market looking for answers.
When you look at the fed minutes, and any commentary coming from ben bernanke, there was such high hopes last time that we would get clarity.
Even though bernanke said a lot and the markets seemed to draw conclusions, it got murkier as time went on.
How much are we really going to learn today about what the feds going to do next?
I don't think were going to learn much in terms of absolute numbers great we will learn something in terms of what the fed is thinking -- numbers.
We will learn something in terms of what the fed is thinking.
We are looking for what the fed is thinking and what that strategy may look like.
From there, they can provide guidance with numbers later on.
I've got my eyes on three different events this afternoon.
1 p.m., footie $1 billion of 10 year treasury notes for sale.
Then you have the fed meeting minutes.
At 4:15, bernanke himself speaks in cambridge, massachusetts.
Which will be the most important that we're watching today?
I'm going to stick with the fed minutes to read.
Were going to get that insight we are looking for.
The other two events are significant, absolutely the treasury options.
But my eye is on the fed minutes.
If we see bond yields staying at this level, will we continue to get record highs for the stock market?
I think we could.
I think we could see risk markets continue to have their recent highs.
What we are really seeing here is earnings beginning to drive things.
The market is rallying on expectations of stronger-than- expected earnings.
We have to bear in mind that analysts had backed off their earning estimates.
The rates market is also looking towards numbers that lead to the tapering.
A lot of these things are coming together for earnings season.
Coming up, a lot more on immigration.
Revolution cofounder and ceo steve case joins us.
? you're about seven minutes into the trading session.
Stocks are higher right now.
Ahead of the fed minutes released later this afternoon.
Lawmakers will be meeting in d.c. today to sort out where they can agree on immigration reform.
It will be behind closed doors.
Steve case, former cofounder of aol, now ceo venture capital firm revolution has been working with lawmakers and the president on new policies.
He just met with the president last week.
The white house issued a report on the economic benefits of immigration.
Steve case is joining us now.
We know you have been beating the drum on immigration reform for quite some time.
You are meeting with the president.
What did you get out of that?
The white house, president very supportive of comprehensive immigration reform.
And other businesses have joined.
It's not just a problem we need to solve, also an opportunity.
If were going to remain the leading economy in the world, we have to win this global battle.
Hopefully in the coming weeks, the house leadership will figure out a path forward and we can get this done once and for all.
I think even you know the talking about the economic benefits of immigration, the number of jobs, the added wealth in this country is not going to bring republicans onto reform.
I'm not sure i agree with that.
There are a lot of different ways to look at this.
Republicans are very focused on the economy, trying to be pro- business.
A third of the republicans supported comprehensive reform.
Two thirds of the overall senate, two thirds of the overall country support this.
My guess is if the senate bill went to the house, he would pass with a slight margin because there would be several dozen republicans that do support it.
What tells you that?
There are a number of republicans i've talked to who believe that the economy is essential, and related immigration is essential and want to deal with these issues.
The house, i think different ills will be passed -- bills will be passed and then they will have to go into conference.
But i am optimistic that something will get done.
If you ask me a year ago what was the probability that a bill would pass with broad bipartisan support in the house, i would not agree.
It's not just trying to figure out what the political calculus is around the latino vote, which some people are focused on.
It's also the political calculus around the business boat, -- vote, and what is best for the nation.
I'm hopeful they can figure out a path forward.
It's also worth remembering that 30 years ago i first moved to washington, d.c., reagan was president.
Republicans broadly supported legislation that he brought.
We've got to let democracy work.
The house has to do its own thing.
I'm hopeful the leadership will figure out this is important and a lot of people in the business community care about -- i think, yes.
A lot of the economic argument from the republicans we have talked to that oppose the reform have said, we can see what the economic benefits are, but they are hooked on or stuck on this idea of how do they offer citizenship, a path to citizenship for the lemon million undocumented workers -- the 11 million undocumented workers in the u.s. there is not agreement on that part.
I agree with your assessment.
The senate had the same issue two months ago, and figured out a way to knit together a coalition to support that path to citizenship, support easing up -- beefing up border security.
The house has to do its own work.
The gang of eight proposed something.
The judiciary committee made some changes.
Additional amendments passed.
The house will make some changes.
Maybe there are ways to improve border security, the path to citizenship.
But we need a path to comprehensive immigration reform.
Would you be ok if we did this in piecemeal fashion?
What if we passed certain parts of it only?
I have been arguing for high skilled immigration reform for over a decade.
It has not passed in a decade.
If we deal with these things as stand-alone issues, you don't have the broad coalition to get these things past.
I think the house will take a path of independent legislation dealing with specific issues but then they will have to come together with some kind of comprehensive bill in conference with the senate.
The likelihood of getting standalone bills passed is very low.
If you care about high skilled immigration, the way to get that done is to support a copperheads of solution.
-- comprehensive solution.
Thank you for joining me.
Steve case, chairman and ceo of revolution, former cofounder of aol.
? one stock we are watching this morning is staples.
Celebrating the official start of back-to-school season already.
Back-to-school accounts for 84 billion dollars in sales, the second-biggest shopping time of the year according to the national retail federation.
The president of north american stores and online for staples joins us now.
He just rang the opening bell, kicking off the back-to-school shopping season.
What do you expect in terms of growth this year versus last year today?
This year a little tough to predict precise numbers, but we are excited about the season and ready to go with a vast assortment of products , amazing savings and deals throughout the entire season.
We are ready to go.
Are people ready to shop already?
In parts of the country, students are going back in late july or the first week of august.
What parents are telling us is, they want to get a jump on back- to-school shopping.
They want to start two to three weeks ahead of the actual date.
What will be different this year?
We have even more products, even more different colors, neon.
We have some of the neon products.
-- products here.
It's a pencil pouch.
We have a light up stapler.
There's lots of really fun products.
A lego lunchbox.
I'm holding a google chrome book which sells for $249. i want to ask you about tablets.
How much is that becoming a bigger part of your back-to- school shopping?
Students have really adapted to using multiple devices.
Is that eating into the sale of notebooks and binders?
Not so much traditional binders and notebooks.
The computer business has been under pressure.
We have an amazing assortment of tablets in the store.
The majority of college age and high school students are still using pc's or chrome books in this case and many are using both a tablet and computer.
It's easier to get around and absorb content with a tablet.
Take you for joining us -- thank you for joining us.
Turning to today's global outlook, russia's president vladimir putin is following in the footsteps of joseph stalin, at least when it comes to housing his friends.
Stalin build a housing complex.
Putin has done exactly the same thing.
It is an 11 story building, guarded by russia's equivalent of the secret service.
If you want one of the three dozen apartments up for sale, assuming you can pass his scrutiny, it will not come cheap.
You will have to spend up to $50 million to live in one of those buildings.
Up next, tesla and ford.
Both are red hot.
Could this be the best year for the u.s. auto market since 2007? ? general motors drove his way to the s&p 500. tesla started trading on the nasdaq 100. if that does not make you bullish on industry, look at the stocks.
Shares of ford and tesla both hit 100 week highs yesterday.
Let's get to the auto capital, detroit, and check in with jamie butters.
It seems like right now the auto industry is firing on all cylinders.
It can this last?
It is going on also wonders, even the cars that don't have cylinders.
-- all cylinders, even the cars that don't have cylinders.
[laughter] the growing economy, recovering from the pent-up demand when no one was buying cars in 2009 and 2010 -- we are really seeing growth in all segments, from compact cars, family cars.
Trucks are doing well.
Electric cars are all selling the best they ever have.
There is a lot of auto joy to go round.
Investors are trying to get in on that.
What is the biggest risk now?
It is different by company and by segment.
Higher gas prices could dent the overall economic growth.
With tesla, they have a lot of challenges ahead of them with the european rollout.
A lot of the fundamentals are there to keep growing, at least through this year and probably next year.
Then you start bumping up against the high plateau of the good old days, and some questions about where things can go from there.
Does that mean prices are discounting on cars is going to be less and less?
We will see.
The automakers, especially detroit, has gotten a lot more disciplined , a lot more responsibility about trying to sell cars closer to the sticker price.
As growth slows down, there's going to be attempt patient by detroit and the competitors to start cutting their prices to give more discounts to gain a little share.
Great for consumers, but not investors.
Thank you so much.
? .. .. we are about 30 minutes into the trading session.
Stocks are slightly higher because people are waiting for the fed minutes.
I have adam johnson here.
The fed minutes come out at 2:00. this is a big deal.
We're going to get another glimpse inside ben bernanke's mind when we talk about tapering and what sadly that means.
-- what exactly that means.
Yum brands is on your list.
The fed is more important than yum!
They will come out with earnings after the closing.
Down about 19%. 50% of their profits come from china.