Obama Delays Syria Strike: Surveillance (09/11)

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Sept. 11 (Bloomberg) -- Full episode of "Bloomberg Surveillance." Guests: Dan Frommer, Michael Wolf, Joe Daniels, Alan Patricof, Andrew Rosen, Rafi Mohammed, and Daniel Libeskind. (Source: Bloomberg)

President obama says he will negotiate with putin and assad.

The new iphones -- i like the camera, scarlet likes the architecture, sara like that it is 112 grams.

It is the engineering, stupid.

12 years after the attacks, we will speak to the man leading the design of the 9/11 memorial and museum.

Good morning, this is "bloomberg surveillance." i am tom keene , live from new york, it is wednesday, september 11. joining me is sara eisen and scarlet fu.

Most interesting day but we all look downtown.

Where we see the 2 lights.

In terms of economic data, we got an overnight report from the u.k. showing britain's unemployment rates apply singly declined to 7.7%. -- surprisingly declined to 7.7%. mark carney said, maybe we will assess our policy stance.

Sterling came up on the idea maybe we don't need lower rates and u.k. for a long time of the unemployed rate is having in the right direction.

This morning in u.s., the weekly regan mortgage applications at 7:00 and at 10:00, look at wholesale inventory.

Really nothing in the way of earnings or corporate events today.

I want to get through the data check, affected by the president speech last night.

He will go to peter cook in moments.

Futures flat.

Crude moved two days ago . let's go on to the second screen.

Bring crude, 112 come in nicely under the 116. the vix is better than good.

Nasdaq doing great.

A little u.k. optimism.

The nasdaq is on a tear.

Watching the markets go higher.

We scour the papers and the web as we always do with the most important stories.

We have to kick about the president speech last night.

And imagine how many rewrites of the speech they had to go through?

He delayed the decision on military action against syria that spared him a political defeat at home, but pledges the u.s. into potentially retracting negotiations with russia and syria.

This is a huge turnaround from 10 days ago when he asked congress for authorization to use military force.

The president spoke about this diplomatic path in his speech yesterday.

It is too early to tell whether this offer will succeed in any agreement must verify the assad regime keeps its limits.

But this initiative has the potential to remove the threat of chemical weapons without the use of force, particularly, because russia is one of assad's strongest allies.

Therefore, i have asked the leaders of congress to postpone a vote.

The rise the use of force while we pursue this diplomatic path.

Ask the united nations yesterday canceled a meeting they were supposed to hold.

It is a new diplomacy.

I am sure it will be a theme not only today but in the coming months.

And we will be discussing that further later on.

On the corporate side, on the cover of "the financial times," verizon, selling a huge number today.

It could be a must three times as big as apple 17 billion dollar offer.

The idea here of $190 million, $100 million of invitation -- indication.

Isn't it a distortion?

We got to do this deal?

Looks like it in before the fed starts to taper her we see higher rates.

You could see that rush for verizon wireless bonds.

We will be monitoring that.

Let's not forget we have to talk about what happened in cupertino yesterday.

What happened?

From the stockport of you, they seem to be disappointed with the appleshare.

The concern is the 5c , the color phone, was not cheap enough and apple did not announce a deal with china mobile -- at least not yesterday.

This was apple's first major product abuses the ipad mini last year we know product drives the share price, drives apple's growth.

Absolutely.

We will dive into this in the next block.

Especially on the price.

The camera blew me away.

This is my headline, "the camera ." you focused on the color.

White gold.

Wait into you see the camera.

Really?

I'm all about the price.

You could take a picture of the cincinnati reds.

That will be my first picture.

When you're at home or in a bar, this camera has a flash for you.

You're like product placement.

Our top story in that would be the president.

We have to head to washington where peter cook is standing by.

President obama hitting the pause button on a syria strike.

It is a diplomatic solution.

Did the president move the needle at all?

I don't think the president did on capitol hill.

Maybe with the american people, we will see to come.

It was unusual in this president was leading the push for military action just a few days ago, however thing changed with those off-the-cuff comments from secretary john kerry.

Last night the president with that mixed message, yes, we need to be prepared to strike at syria, the moral outrage over what happened that appeal to both critics on the left and critics on the right, sturdy -- pretty strong appeal to keep that threat out there, but we don't actually need the military threat just yet because we are going to pursue this diplomatic initiative.

Very unusual for the president to address the nation effectively and that 2-track approach.

Let's call it original diplomacy.

What will secretary kerry actually do?

Does he fly to moscow?

Will he talk to the syrians?

He will talk with the russians and go to geneva.

You will not had a russian soil.

Two days of talks with the russian foreign minister.

To be a fly on the wall, i would love to be there.

Listen, the u.s. and its allies want to make sure this effort, if it is legit, is ironclad and that there is some sort of enforcement mechanism to get the syrians and the russians to agree to what it is they propose . that will determine what happens next year in washington and in damascus as well.

That will be the critical negotiations.

Every thing in washington is effectively on hold until we hear what john kerry comes back with and see what plays out at the u.n. yesterday the russians tabling the security council meeting in part because they're worried about the language with what the french have offered up, they want to take they threat of force off the table entirely.

In the backorders, peter cook, is our military on board with this?

I think the military is on board in this sense, tom, they follow whatever it is washington, the leaders in washington asked them to do whether it is a pin prick or something more substantial.

This stop and start is not easy on the u.s. military.

Yes, they're ready to go at a moments notice, but this could be weeks of negotiations.

Congress is it sure they're -- there is a divide whether to pursue a more modest resolution.

Something that incorporates the diplomatic initiative yet still sets the threat of force down the road.

Carl levin wants to see that, but other lawmakers question whether they should be doing anything.

There is still a risk in my not play out in a peaceful, diplomatic way.

Any are talking about the president speech, maybe he should've canceled it.

Did he waste the opportunity for big speech like this?

He will be interesting to see.

Should he have put a pause on the speech as well.

Imagine of the president has to come back in a weeks time, two weeks time when the diplomatic effort has fizzled out and say, here we go again, let me make the case one more time.

How many people will tune in?

How more effective could that speech be if you did not deliver one last night?

Politics at play.

Thank you for the briefing, peter cook.

A diplomatic solution potential here for syria.

I wonder how much will get done in washington until there is a resolution on syria because they cannot really walk and chew gum at the same time in d.c. our guest host, really focused on technology and apple, michael wolff is with us.

Former yahoo board member and executive at in tv.

-- at mtv.

We will talk about why i love the iphone 5 as an something adjusting going on in silicon valley.

As much as we care about what you think, tom, we care about what everybody thinks.

Our twitter question of the day -- it was a big announcement for apple.

We will talk about the strategy.

Tweet us what you thought.

? good morning.

Coming up, sheila bair will join us, now the pew charitable trust, former fdic chairman.

She is opinionated, particularly five years on from lehman.

That is at 9:00 this morning.

This is "bloomberg surveillance." we are digesting the big apple announcement, a plastic smartphone for over $500? everyone was anticipating the announcement of the cheap iphone 5c yesterday, but did apple go cheap enough?

Cheaper.

Is more mid tier according to analysts.

If you get it on contract in the u.s., it is $99. but for those in emerging markets to don't get a subsidized version, it will cost $549 for the lowest version.

In china, it is equivalent to 730 three dollars.

Still fairly pricey.

The whole point was to get the emerging markets consumer by putting out a cheaper phone.

That is what wall street and investors were focused on.

We sell the stock react.

And the fact the apple could get a whole new class.

The big issue here is apple did not really announce anything in terms of a deal with china mobile, which is the world's biggest mobile carrier.

There is some speculation perhaps they will announce something today in beijing because they're holding an event there as well.

There are many people disappointed.

This is all throughout the analysts note i've been looking at.

With us, dan frommer and michael wolff as we discussed apple.

Dan, i thought the are poor yesterday was totally in every way off the mark.

Then david pogue came out with what happened yesterday.

Whenever stock analyst say apple is doomed, that means apple is in really good shape, right?

Why does david get it and everybody else is fighting the last war?

I don't understand the industry of apple watching.

He has always thought like a normal person would.

That is the role he plays, to write for the real person out there.

I'm not just necessarily the person who is trying to engineer the best performance out of apple stock or market shares, specifically, something that has hung over the smartphone industry.

If you look at the companies that have chased after market share at the expense of profitability and revenues, there is nokia, ram, and a bunch of other companies that are pretty much gone.

This was an engineering announcement yesterday of the a7 chip and the 64-bit architecture, which matters to all of us.

It was a huge upgrade in speed.

This was like a powerful computer, desktop class they said, in your pocket.

Are you willing to say this is the first phone that is a 4 computer?

I think the iphones felt like a rock computer to me, but this is probably 30 times faster than that.

-- i think the iphone 4s was like a computer to me, but this is probably 30 times faster than that.

The faster this device is for watching video in a freezing apps -- and games.

And games.

The phone comes with an accelerometer built in.

It will be part of the wave -- that is the motion sensor technology.

It will know what you're doing, where you're going.

It will know i am not exercising.

It is not just a motion sensor, but a separate chip that means the motion sensors can work without draining your battery.

I have a question, michael.

Mr.

cook, ms.

Meyer, and all the rest of them, it seems to be totally off the market at what these people are actually doing, which is meeting a need.

Ultimately, this entire business comes down to one thing, which is the user.

The most important person is the person he was holding that smartphone.

That is what these companies are focused on, not the war between the two of them.

Thank you.

Can we have him on every day?

Please.

The smartphone platform works much -- wars are pretty much over.

Apple has roughly 40% of the market, android has 50%, microsoft is 3%. this is the way this will end up being.

Would we talk about what makes apple distinctive, rbc capital markets was pointing out the true differentiation versus google and the samsung is the ios and apple announced ios 7. does that go far enough to take advantage of the stickiness of the pool of people it does have under the relevant?

I think what is most important is the apple ecosystem, the fact apple -- it is really easy to buy music, games, videos, apps.

The android market play and google play, they are not as strong.

You're wearing a smart watch.

Do you believe in this wearable technology for apple and the rest?

I think the wearable technology is going to be critical to how we measure ourselves and share information.

If apple comes out with one the next couple of years, i think it will expand the market, partially because it works with your mobile phone.

It works with your mobile phone.

Margins is another issue entirely.

When i was looking to the analysts notes, sure, investors may have been disappointed with their pricing, but they say the pricing, the not aggressive resting on the 5c keeps apple's margins in fact -- intact.

What's not to mention the brand factor.

Ultimately, apple makes money from the carrier, not necessarily the person buying the phone.

I grew up in a codex family.

I look at those photos last night on the apple website from the 5s and i was stunned.

They are not like nikon quality, but that phone -- i can't even river the last, made a phone call.

I take the tours constantly.

The slow motion video?

The fact you can now take -- imagine this, we can have sara before the show starts -- pop music.

Putting her bronzer on.

Slow motion before the show.

10 things in a row.

It will automatically since which one is most in focus and then save that one and get rid of a bunch of other ones.

But the resolution, to me, was jump condition.

This is a camera that also takes phone calls.

And has a web browser.

That is a new exclusive.

In the next hour, we will talk to pricing expert about the question of how cheap is cheap enough to capture the emerging market for apple.

Also coming up, what do nike, visa, and goldman have in common?

Major growth, for one thing.

This is "bloomberg surveillance." ? this is "bloomberg surveillance." scarlet has some company news.

Let's start with the investment from that hundred with carl icahn on dell, it has taken a stake in news corp.. they bought 12% of rupert murdoch's publishing empire.

It is closely honest $400 million investment in a regulatory filing.

Southeastern says it has no plans to influence news corp.. the management of american airlines and us airways will ask their boards to extend the termination date for their merger.

The deal is set to expire to summer 17. that is less than a month after the antitrust trial with the justice department begins.

According to the wall street journal, the carriers want a new expiration date and place a longer than anticipated trial.

Walt disney delays the next price -- parts of the caribbean film.

The latest script is still being worked on and "the lone ranger" was a bit of a disaster.

Isn't like the fourth or fifth movie?

It needs to end.

Is a moneymaker.

Hollywood has no good ideas anymore.

Moviegoers do not want it to him.

I think they want more pirates.

In less -- endless pirates.

We're going to start with the markets.

The nasdaq said a 13-year high.

Struggling emerging markets.

A research fellow at the peterson institute for institutional economics wrote in a bloomberg view -- this is a big debate right now the weather this is short- term pain we're seeing in emerging markets as the fed considers tapering or something longer-term and more worrisome.

Looking at the indian rupee , it has been rebounding over the past few days from its terrible slide.

You know how much flak i got for saying rupia instead of rupee?

They've given it a name.

Morgan stanley absolutely nailed this call.

He said it is not the brics you should be looking to.

My morning must read -- there is no nelson mandela they can turn to.

The problem was brought on by the arab spring.

We see it laying out in egypt and some of these other nations as well.

It is a tricky predicament not just for the president, but the americans, over how to be engaged.

It just goes on.

To me, it is original diplomacy.

It sounds like a leadership vacuum.

There's so much going on.

Coming up, we will talk with michael wolff, marissa mayer , next ? it is the 12th anniversary of september 11. two years ago, michael mckee and i join the world as they opened this beautiful museum, 16 acres in downtown manhattan.

Good morning, everyone, this is "bloomberg surveillance." it is a pretty calm data check with u.s. markets rising in the last few days and the biggest winning streak in the last few days.

The nasdaq is trading at a 13- year high.

Treasuries are rising.

There is better economic news we have been seeing and some relief that the u.s. will not have any military action within syria.

S&p futures are up barely.

They are still going up in the green.

A real recovery, a risk on field for the last few days.

Oil has come off of its two- year high as well.

What do we have for gainers and losers?

I want to focus on losers.

Conagra is down six percent and yesterday's trading, falling the most since november 2008 after it cut its full-year profit forecast.

Urban outfitters lost 10% of its value, the biggest drop in 20 months.

Third quarter comparable sales rose only -- it was like but -- back-to- school never happened.

Amazing.

There are more movers to watch.

Apple may be getting the buzz but we need to talk about something that has no shares of apple , the dow jones industrial average.

The biggest change in the dow industrials in a decade,. dow jones says these companies represent the dow jones more than other companies.

Goldman sachs is focused on investing more than traditional banking so they included it over bank of america.

There was no previous representation of a footwear company like nike and visa is a major technology company, a leader in payments.

Michael mckee joins us now.

On the september 11. you were at ground zero the day of 9/11 and was quite something.

We will talk about that in a bit and we will do this on radio this morning.

Let's talk about the tao.

What do we know?

It is not representative of the overall u.s. economy nor is it representative of the overall u.s. stock market but it is an effort to make it more relevant for dropping some of the dogs of the dowm, the lowest performing stocks.

They do this on a regular basis that they don't have apple in there, they don't have google which are companies that represent the economy today.

The price is too high for those two companies which means that the dow is a price weighted index.

Most pros don't follow the tao.

Ibm remains the heaviest weighted component of the dow industrials.

We will see a major change in the way the dow trays because the three stocks being dropped -- if there is a big move and goldman sachs, it will affect the dow industrials.

Is there a dow-like s&p 500? it does not change how the dow represents the economy.

Michael wolf is eric guest host who is the founder and partner of technology strategy and has been on the board of yahoo.

Does it signal a shift toward a more goods economy?

Nike and the visa and goldman sachs represent not just services but the next wave and technology.

You've got nike which is really moving into smart devices that are about quantifying what we do in terms of fitness.

Visa is not just becoming a global payment company but also it will latch onto this whole growth in mobile.

The fact that i can make it tame it with my mobile phone will make a big difference.

Visa is at the front of that.

In silicon valley, it is intellectual and human capital and visa has 8500 employees which does not sound like a dow company.

Will we have a dow jones industrial average in 20 years which is great american companies with few jobs?

All of these next age companies are focused on fewer jobs.

They are more about using technology and efficiency.

I don't know what that means in terms of the future of the dow.

In the future of american industry, i think it means leaner, faster, and much more agile companies.

Art yahoo and visa friends of the american labor force?

They are enabling workers, enabling american workers.

They are making their own companies more efficient but also the rest of the company -- country more efficient.

What happens to the companies that are now in the dow?

Not as many etf's or mutual funds are tied to the dow.

For those coming in, fund managers who have them and their portfolio and etf's that mimic the dow will have to buy them to bring their weights up.

It may hurt the other companies leaving but their stock prices are so low, it will probably not have a major impact.

Scarlet fu pointed out yesterday that the companies that have left the dow over the years tend to see their stock prices go down.

Are they going down because they were kicked out?

This is without a calculator before 10 a.m. old dow components, 649,000 jobs, new dow components, 87,000 jobs.

It is 81-8 ratio.

Since 2000 when technology became the story of the u.s. economy, job creation has been flat.

Productivity continues to rise.

We are getting technology gains but not jobs out of it.

Economists don't know why that is.

We have seen this before in history, creative disruption.

We are supposed to see old companies go away.

When auto manufacturing came in, it created hundreds of thousands of new jobs.

Apple and nike and those companies are not creating so many jobs.

Are they creating profits?

Profits and cash flow, yes.

In terms of employing america, there it is.

We are not -- it is widening the income divide because that entry into the middle class is not there anymore.

It's good for stockholders, people at the upper end of the income bracket.

There is a football game tomorrow night.

One bond fund manager in california might be watching.

We will see.

Coming up, we will talk more about innovation.

Also, our twitter western of the day -- did you like the new price tag of the 5c? did you like the new colors?

? this is "bloomberg surveillance." president dope am i has delayed a on a military strike on syria.

The president reversed course and a spatial at night saying he would pursue a proposal by russia which calls for syria to surrender its chemical weapons to international authorities.

The national security agency wrote the rules on surveillance of phone records for almost three years.

The new records show the nsa spying was broader and more frequent and targeted more innocent americans than first believed.

In sports, the u.s. men stock or has clinched a spot in the next year's world cup.

U.s. the mexico 2-0 but got help with santarus which type and monitor it it will be the seventh straight appearance in the world cup for the united states and those are your top news headlines.

It will probably boost viewership in the united states.

It will be a huge deal.

Brazil is spending a ton of money on the olympics and the world cup.

You have to watch soccer with the spanish broadcasting on.

Or with the sound off.

It is september 11, we are 12 years on and there is an impatience.

Much of 16 acres is completed but more awaits.

We have the chief executive officer of the september 11 memorial and museum and has been a lightning rod for controversy, criticism, and the claim.

He has an emotional job after penn, law, mckinsey and the robin hood foundation.

Two years ago, michael mckee and i broadcast from's -- from ground zero as you unveiled the exterior.

People were desperate to get into the museum and what you will say with the museum.

What do you hope to do with the museum?

Fundamentally, we want to tell the history of what happened on the day of 9/11 but we want to show how this country came together in the aftermath and responded with absolutely limitless compassion.

The stories of the first responders, how they went into the buildings, and how more than 20,000 people escaped and we want to make sure the victims are remembered for the lives they lived and not just the deaths.

I command " the new york post" article this morning.

In it, she speaks of the emotion including this evening an act of archaeology.

A medical examiner will be in your museum, discussed that please.

One of the shocking statistics that is out there about 9/11 is that 1100 family members never got back any human remains of their loved ones to be buried.

There are unidentified remains and we, in response to family members, are bringing back these unidentified remains to what we call sacred bedrock.

We are building a separate space for the city medical examiner, a repository for those remains to be here at sacred around zero as new identifications get made.

How will downtown new york look in 10 years?

How will this museum and the 16 acres fit into the recovery of downtown manhattan?

As a resident down here, it's amazing.

People remember the towers and what they look like and remember the day of 9/11 when the buildings came down.

They remember the horrible 9 -- month period of recovery when there was a mass of debris and they remember the empty pit.

To be at a place where new buildings are rising around us, the memorial that is eight acres with trees and water -- it shows this area is back and in some ways better than before.

The anniversary of course is something to remember those who are not with us anymore.

Joe daniels, thank you so much, with the national september 11 museum.

That was something with michael mckee to look down and see president obama and the first lady.

They were walking around this new ground.

Am the first family will observe a moment of silence in the capital today.

We have a photo in honor of the 12th anniversary of the terrorist attack on the world trade center.

It is the tribute in light.

This is what was shown last night and lower manhattan.

I saw it from my window and you can see to the right is the freedom tower.

There were memorials across the nation.

The names of the victims will be read out at the plaza today.

No politicians so they will not speak at today's events on this 12th anniversary of 9/11. ? this is "blue birds surveillance." -- bloomberg surveillance." let's start with intel developing a new line of chips for wearable devices.

The line is called quirk and will draw little battery power and fit into small devices.

Google is teaming up with harvard and mit to expand and line education.

It will develop open edx to create new education software and will create a site to allow institutions outside the network to develop their own courses for students and he were in the world with access to the internet.

Verizon will pay investors a premium on its record $45 billion bond offering.

They may sell tenure bonds at a yield that is 225 basis points higher than treasuries.

Apple was able to offer a record round of bonds at less than the market rate this past april.

That is company news.

We will talk about yahoo.

Its market cap is sort by 15 billion dollars since marissa mayer became ceo, 14 months ago.

We have two important guests to talk about yahoo.

You've been digging into some of the numbers.

Beyond the stock price reaction, marissa mayer shelled out more than one billion dollars to buy 16 startups.

A lot of criticism out there that there was not much of a strategy, it seems kind of random.

Keep in mind that all of her purchases have brought mobile content apps and services and talents.

Yahoo has shut down all but three of those companies and integrating the technology and talent and brought only companies focused on the yahoo core business.

At the same time, she refreshed some key products like search, weather, and a flickr.

Michael wolff, you help to get her with dan loeb as ceo and has made her mark.

She even created a stock market rally.

When does this translate into results and profit?

Tech companies need users and second to get users, they need the best technology.

What marissa mayer has done is she has changed the whole user experience, revising it and to do that, she's had to do aqua hire, she has to buy small companies.

Tumbler was a big one.

It was one of the few supernovas on the web, over 120 5 million people going there every day.

The comparable but the when google bought youtube.

Youtube is an enormous money machine today.

I think tumbler will do the same thing for yahoo.

So you and dan loeb are not on the board anymore.

We left after dan loeb's share in the company went 11 two percent.

We agreed to re-sign after the company went there.

How do you ensure that marissa mayer is the right set to create permanent shareholder value?

She's got a great word behindwe agreed to re- her and she has been able to recruit a fantastic team.

She moved out all of the senior managers in the company and hired new people, the best and the rightist.

-- and the brightest.

I think the path is clear and now the user growth will turn into revenue.

Where is the revenue going to come from?

I have not seen the sell side report.

The company's user base had decline for years and now that their traffic is growing think the path is clear and now the user growth will turn into revenue.

Where is the revenue going to come from?

I have not seen the sell side report.

The company's user base had decline for years and now that their traffic is growing again and now that the time users are spending on the site is growing, they will not have any trouble getting advertising.

Do you buy that, alan?

Completely, i think what she has done more than anything else is changed the atmosphere and morale around yahoo.

I remember going on a visit about five or six years ago to goggle -- to google and yahoo and i could not leave the difference in the atmosphere going from those two places.

It was so shocking as to how different.

You go there today, it is a whole different atmosphere and marissa mayer, by bringing people away from a virtual existence, living in their houses, ringing them to tether and making it a community has created excitement again around yahoo.

You have a 400 foot boat out on long island called early stage?

Is yahoo a late stage stock?

Yes.

I agree with michael about the acquisition of tumbler.

It was bringing the traffic and they need a hot new traffic.

Look at what instagram has done since it was bought by facebook.

You just saw the numbers the other day.

When you get excitement around the company, you attract technology, you attract users, you attract traffic and you attract advertisers.

Yahoo is a good example where you bring in an exciting ceo.

When we look at other big tech companies, they face challenges like microsoft.

What would microsoft need to do to look for the next ceo?

It needs to take a bold stroke.

The board needs to look at what is happening with microsoft's products and they need to start with who is using the products.

Up to now, their customer has largely been it managers in companies vs worrying about the person using the software.

With the release of the new phone, apple has given away its productivity suite.

The i-work is now free.

For anybody who's got the phone.

That could attract enterprise business away from microsoft and blackberry.

Absolutely, one of the big enterprise companies today is google.

Google apps are being used by a large number of companies.

What kind of ceo do you want to see replace mr.

Ballmer?

They still have to run the enterprise division.

Are you available to take over?

I think they've got seattle vs new york is not very appealing to me.

I think microsoft has some of the challenges that yahoo did.

It has to re-create that excitement around itself.

Microsoft is such a behemoth but it is not considered cool anymore.

Maybe they need more agitation like a damn low.

We need three names right now.

That people that meet the criteria for microsoft.

One would be robbie bach . another one is going to be -- i've got to think of other people -- i don't and have anybody inside the company.

Anybody at intel?

I don't think so.

It is too stodgy.

I think somebody like eddie cue that runs the application developments and even somebody, if you'd that would be jason kylar who started hulu.

Microsoft has forgotten about the people that use their product.

Fascinating, thank you so much.

How about a foreign exchange check?

We are closing out the hour and right across the screen, the euro is weaker against the dollar and the dollar is slightly weaker against the japanese yen.

There is enthusiasm around the 2020 hosting of the olympic games.

We sought better chinese exports and industrial output.

Same thing with the sterling.

The unemployment rate in the uk kicked down to 7.5 % which is better than predicted.

I think it's fascinating in the shadow of 9/11 and the apple news.

There is levity in the market.

September see -- is usually gloomy.

Coming up in the next hour on this september 11, 2013, daniel leafkin will be joining us.

? . ? president obama addresses the nation.

Now he will have to negotiate lift but vladimir putin and assad.

What is "the washington post" company without "the washington post"? i have to brush up right away.

September 11, 12 years after the attacks, we will speak to the man who came up with the design for the world trade center plan.

The morning, everyone.

This is "bloomberg surveillance ." it is wednesday, september 11. joining me as always, sara eisen and scarlet fu , and joining us this hour alan [indiscernible] i know that he is excited about some twitter news today.

The verizon mega bond sale attracting a lot of attention, we year.

Overnight news including the british unemployment rate moved surprisingly 7.7%, which the bank of england governor has said that they will rethink their policy stance.

Here in the u.s. at this hour, mortgage applications, weekly numbers, 10:00 a.m. pretty light data and nothing much in the way of briefings.

Let's pick up where you left off.

Verizon will put -- pay investors a premium on their bond offering.

The company may sell 10-year bonds higher than treasuries according to people with knowledge of the issue.

Allah -- apple was able to offer less than the market rate , they have taken a stake in news corp.. southeastern asset management bought 12% of that publishing empire.

According to the filing, southeastern has new plant -- no plans to import.

Apple shares are down 2% in the pre-market, disappointed with the latest apple iphone introduction.

The new low-cost model may not be cheap enough to grab market share in the emerging markets and apple did not announce a deal to sell the funds to china mobile.

They will instead be sold through two smaller wireless carriers in china.

Let's get to our top story of the morning.

After president obama address the nation, hitting the pause button on a serious strike, the u.s. will wait on the united nations for a diplomatic solution, potentially working with russia in syria.

Matthew dowd has more on the effect of big speeches.

You have been critical of big speeches before.

Did the president accomplish anything last night?

Not critical a big speeches, but it is always important to put them in context.

Looking over the span of history, the last 50 years, when a war or military action becomes unpopular it is almost unpopular to change the trajectory of the american public.

Johnson tried it with vietnam, it did not work.

Bush tried it with iraq, it did not work.

I think that the president gave an effective communicating speech.

It is not read the public is on all of this.

I think that what the president is doing today is thanking god that with this black swan event that has developed over the course of the last 48 hours and the fact that vladimir putin right now is probably the only person able to get the president out of this box is a little dicey.

A little dicey?

What is the trust factor here?

[laughter] i do not think there is a lot of trust, just a lot of hope.

Interesting things on the world stage, if vladimir putin is able to do this and is somehow able to convince assad to hand over chemical weapons, it changes vladimir prue and on the world stage.

Where is secretary john kerry in all of this?

I think he is trying to whine his way through this.

The president has himself in a box, some of it created by his words and some of that created by the nature of events in syria.

I think that john kerry is trying to get his way through this, obviously trying to catch up to some of the work he has used over the course of the last week.

The entire administration knows that they are in a quandary and they were looking for a way out.

They got the chance for it, but again, it is not in their hands.

Quickly, there is still a risk that if this does not work out the way the administration would like, what is the best for the president and the administration?

The risk for this not working out in the president feeling like he has to take military action against syria?

Very unpopular, it will make the effectiveness and the effect of all of this probably the continued irrelevancy of the president over the remainder of his term.

The interesting thing to me in all of this is that in the aftermath of katrina eight years ago this exact same thing happened to president bush and basically after labor day in september 2005 the bush presidency was over, and that could be where we are today with president obama.

They with us.

Allen is here with us from great rock.

Also, very active in democratic party politics, is this foreign- policy?

This is a bit away from your expertise, the year we are, the original foreign policy.

Your thoughts?

I am not a foreign policy expert, but it seems like the president was saved by the data sets not enough -- by the deus ex machina last night.

He has to do what he has to do or he will be left out to dry.

Is the president settled by the remnants of the democratic party post-vietnam psychology?

Or have we finally moved on to a different position?

Regarding foreign policy.

You are putting this in a very macro sense and i think the president is working in a very micro cents.

A fine line that crosses his whole image and reputation, it will be sacrificed if he does not do what he said he is going to do.

The question is, how long did they leave the pause button pressed.

Unfortunately, secretary carry -- secretary john kerry was hung out of line last week.

You go with the government policy and the next day everyone says what the president says.

I think we should all be very hopeful that it works.

The serious question has but also critical debate that congress needs to have is a country right now.

The debt ceiling, taxes, immigration.

As an investor, those are important issues to you.

Is this concerning?

The market does not seem to indicate that, does it?

The gradual employment improvement, in general the economy is looking better, interest rates reflect that to a certain extent.

I think we are in a good wave.

Matthew dowd, finally to you, how coalesce the the democrats behind their president?

Are they all on the same page?

The interesting thing is that both parties are conflicted on this and there is huge division in both parties.

There is a whole part of the democratic party that does not want to go to war at all, even if advocated by the president, and the republicans are now split.

This issue is not partisan driven.

If you look at the polls, the majority of republicans and democrats are opposed to it will, including independents.

We have huge conflicts in both parties related to this issue.

Matt dowd, great to have you with us, and alan patricof will be with us throughout the hour.

What you were looking at the issue of syria and the president, i was watching shares of apple continuing to fall this morning.

This all comes one day after their new plot -- their new product announcement read they attempted to shore up market share in the smartphone internet -- smartphone industry by introducing a cheaper, lower- cost iphone5c. would you suggest that the disappointment was mostly around pricing?

That and the fact that they did not announce a deal with china mobile.

That was going to be the big linchpin.

That does not mean that it is not a done deal yet, does it?

Many people are wondering.

It is like two different conversations.

There is a question about the innovation machine that apple is now under tim cook vs.

What it buys.

As you know, i was there at the very beginning as a lucky investor in the late 1970's. i have seen the whole world change for them and am a big believer in it, but including myself i was disappointed with the price.

I thought it would be a much lower price and, in 2 position in terms of strata pricing within that range, this coming in as a low-priced found to open up a whole new market.

Alan patricof is here with us throughout the day.

What did you love or hate about the apple announcement?

Join us to tell us on bloomberg surveillance -- "bloomberg surveillance." ? ? good morning, everyone.

"bloomberg surveillance." i am buying an apple iphone, so back on a late stage and did it.

Alan patricof, investor, early stage with intel.

He is investing in global mobile -- global mobile through vodafone?

Note, thank estonia.

What is it?

A payment system and mobile devices primarily used by game users.

We do not realize that when people play games, particularly in the rest of the world, they are paying 10, 20, 30 cents to play something and it is a very complicated process to charge people, so all of those charges are done not on the credit card, but through the carrier.

It is in about 85 to 100 countries in the view go play fight my monster, play the game, people will be playing through the system carrier.

A verizon is having lunch today with a bond trading action.

Vodafone got the money.

Can they compete with alan patricof?

Vodafone can do whatever he wants.

I would not worry about them.

Have you play around?

We are always looking for young, emerging companies.

We moved vodafone through a couple of payment companies and a measurement company, it measures how apps are doing and everyone wants to know how they are doing.

L.i. going to have it on my iphone?

It is something that the people who are developing games for applications for the iphone, android, or anything else, will be looking at daily, weekly, monthly.

It is very sophisticated technology.

Which phone does alan patricof use?

Apple 5s? you are at a time when i am in a time of change.

What are you going to do?

I have been a blackberry supporter for so long.

Are you going to buy one not to give it up?

I was thinking of buying a galaxy, and thinking of perhaps also purchasing a q10 having two phones, but i have not made up my mind.

Who should buy blackberry?

Anyone who wants a basic name that needs to be resurrected.

He will not give up the keyboard.

Alan patricof on blackberry, good morning.

? ? this is "bloomberg surveillance." i am sara eisen, here as always with tom keene and scarlet fu.

President obama has delayed a decision on syria.

The plan for russia calls for them to surrender weapons super international authorities.

The nsa broke the rules on 4 -- phone surveillance for almost three years in the records show that their finding was broader and more frequent than we thought and targeted more americans than first believed.

In sports, the u.s. men's soccer team has clinched a spot in the world cup, beating mexico 2-0, tied with panama to secure a spot in the tournament, it will be the seventh straight appearance for the united states in the world cup.

The red sox won again, tom.

More importantly, england still has not qualified.

You keep waiting for the red sox to stumble and they will not do it.

Friday.

I would predict fireworks.

Apparently the red sox always stumble, so it will happen.

All right, we are going to talk about "the washington post," right now.

The company, the washington post, no longer owns "the washington post.

What do they do now?

I used kaplan for three years straight just to try to get into college.

For-profit education is a late run for controversy.

It used to be about losing your kids s.a.t. scores, now is about keeping the government off your back.

Andrew joined kaplan in 1992, through thick and thin, he is the chairman and chief executive officer, removing for new talent.

Is there a yearning every day to get back to what kaplan used to be?

Or is it all about the move forward?

We value both, improving learning, applying it to a marketplace with that kind of approach.

Why is the education and government thinking that this is not about profits?

There is a lot of concern around the country, higher education, president obama they graduate -- now i think this skill has widened.

If we put the kaplan business in perspective in so far as where it contributes to the washington post revenue, that ti's id in -- that ties it in with your business.

Healthcare, a tv broadcasting, where is the fit?

In 2007 with education in media.

Kaplan is the largest unit.

Does anything change for you on a day-to-day basis after the sale of the newspaper division?

No, we have serious emotional ties to "the washington post" but from a financial standpoint it has not been a huge contributor for several years.

When you look at the remarkable revenue of kaplan it continues to rise and only began to turn in 2010, 2011, that was kind of a tipping point.

When you look at what is happening now, the data shows declines were the first time since 2006. is higher education facing a structural contraction?

Or is this a cyclical downturn?

Two things are going on.

One, there is a cyclical downturn with fewer jobs out there.

People and not seeing higher education giving them jobs, so fewer are attending, but in the long term people are becoming more confident as a way for it to get them ahead in their career.

You got a bachelor's degree through a liberal arts program.

I am looking at a professional presence.

They are not teaching that at wesleyan.

We are really focused on people holding the skills they need to be successful in the workplace.

Is it a true bachelors degree?

Or is it a different bachelor's degree?

There are general education requirements that are variable, but it is much more focused on the skills needed.

Way, this is absolutely critical.

Are you telling me that you are calling it a bachelor's degree but i do not have to take western civilization?

Talking about liberal arts here.

Western civ, introduction to international relations, are you teaching those?

To get a bachelor's degree at kaplan you will still get caught in history, ethics, so on, you will get that general education background, but we are going to turn it quickly.

Can the jobs numbers correspond to that?

We are having very good success with their job placement.

Our on campus, over 240% are getting their jobs.

More than the virtual law school?

Those seeking law degrees are trying to be better their existing jobs as a doctor, a businessman.

A supplementary read?

Yes, that is right.

What is the company going to be called?

The washington post?

It will not be called the washington post.

The name will come out later.

Thank you so much.

Coming up, and iphone for $99. cheaper, but cheap enough?

? ? in the early morning sun rise, one world trade center this september 11. below , on this perfect september 11, two years ago the 10th anniversary, the reflecting pool, the names around the edge.

We weighed the museum, scheduled to open next year here in new york.

In washington, american airlines flight, they still remember it at the pentagon.

Services there from the president, finding his moment of silence this morning in washington.

Good morning, everyone.

Sara eisen, here with tom keene and scarlet fu, as always, and we have a big corporate bond market story, the mega bond issue is about to happen at verizon, about bond sale that could be as much as $49 billion.

Investors have submitted almost $100 billion in orders.

The final sign for the offering on wednesday, earlier this year it was their biggest offering but verizon set up in the largest corporate debt sale in history.

There is the search for yield, but also the differential for treasury, look at verizon , look at how you gauge bonding in whether it is john enormous like this or sort of genoil mist, like the apple deal.

Here is my morning must read.

Get the complexity out of the way.

The concession on price may total 60 basis points, the average is 1/3 of that.

What do you need to know?

They are paying a big for this deal.

The founder of craker after -- greg roth, alan patricof -- greycroft, alan patricof , what does this say about rise in raising this kind of funds?

It is -- about verizon raising this kind of funding?

Someone must have just sized the market up beforehand.

If it is not in the bond textbook, if it is not in cain and markets, there is something original here.

May i suggest a distortion of central bank policy?

Chairman bernanke brought the rates down to heal the economy then this is the incentive taken of those of low rates.

Is this about ben bernanke?

I think it is about supply and demand in saying that people are looking for yields and they thought that this was the appropriate pricing.

Investment bankers pretty much know what is happening in the market.

Should we presume higher interest rates?

Certainly, because this is a strong message.

Does that mean that the window is closing also for technology ipo's like twitter?

Just the opposite.

I think that the ipo market, for the first time i have been a bear on the ipo market for companies in my area to the public for the last couple of years.

I think that that is shifting out and the market is opening to take the company's. this is what you are excited about?

Why does this interests you?

It was and inquisitions with millennium going public, rocket fuel coming up to see excited it -- seem excited about that with very strong numbers.

You and me, going public, i think it is going to change a lot of the dynamic now.

A lot of these companies are going to buy some of the smaller companies and you will see a lot of activity there.

Is there a bubble?

This is the first window that has been open in the last four or five years, so i think people are coming in through the window.

I wondered -- lots of companies.

What about all of the trouble there on the nasdaq yak -- nasdaq?

I think that the nasdaq will be an important place for young companies.

It is symbolic.

Alan patricof with us, we will continue a very discussion.

Let's get a data check right now.

Stock-index futures are mixed right now, the 10-year yield is coming down to 2.94 percent -- 2.94%. inventories coming up at 10:00. good morning, everyone, "bloomberg surveillance" on bloomberg television, bloomberg radio, all of our interviews available on ipad, itunes, bloomberg.com, sara eisen is getting the gold photos, in getting the right one.

-- in getting the gray one.

-- i am getting the gray one.

I do not know.

Hockey pictures.

I can see it now.

Clearly, iphones are out.

Tom is focused on the colors, maybe you should focus on which one will match your bow tie.

I am focused on price, and matthew is the author of "1% windfall." he has written for "the harvard business review" on the latest move from apple.

Everyone was going in looking for a price reduction, investors are disappointed that it is not competitive enough.

What do you think?

I think that apple really deliver the fivec for the in contract price.

I think that the surprise came for the off contract price.

I think that apple has had its hands tied, they have a volume deals with places like sprint and if they offered a low price of contract found it would adversely affect its key suppliers, so they are trying to protect existing suppliers as well as there may be a contractual obligation not to offer a low price of contract found.

I think that is the reason why they came out at an uncompetitive price for the of contract phone.

Yet people are disappointed with this pricing.

I know that you talked about what you would have done differently.

You look that different pricing patterns for the features.

First of all, there is a lot of hype for the gold phone.

Certainly i would have charged higher price on that.

For instance, i once interviewed a senior executive for an automaker and when they resold their used cars, they charged a higher price for white cars because they did not attract heat in the south, higher prices for black cars in the north.

But i would have done differently is this -- look, the on contract price, $100 differential, is not that big a difference in making a commitment to a cellular carrier and if i were apple i would have pushed these carriers to follow a leasing model like cars do.

They could have come out and said that you can get one for $199, plus your monthly contract, but if you do not want even pay $100 and we will add $5 per month, or you could do 0 down and $10 per month.

That kind of pricing choice and flexibility really could have taken care of this problem without ruling out a fought -- 5c. an interesting idea, but when you look at apple's history right now, back in 2007 when they launched the first iphone, $599. people were skeptical, they lowered the price, people eventually paid.

Can apple convince the emerging world to play at bridget pay a higher price while preserving their premium brand status?

The market has certainly changed over the last several years and now there is a great deal of competition and apple does not have that kind of pricing power anymore.

Their key is to be innovative in pricing.

In emerging markets, certainly the price of $600 for a confirmed, unlocked found, that was not well-received, but once again, i would be pushing contracts as the way to sell the iphone in emerging markets and have it stay for a 2 year commitment.

I think that apple missed an opportunity to really come in like a submarine here and do something dramatic in terms of pricing.

Experience tells us that it would have opened up a whole new market for apple, of which so far they have been very careful to -- not avoid, but not go after.

Think you for joining us.

Stay with us for the hour.

"bloomberg surveillance" on television and radio.

? ? good morning, everyone.

"bloomberg surveillance" this morning, this morning "in the loop," is the former fdic chairman sheila bair, always controversial.

I just got an e-mail about my boat high.

They thought it was very 9/11. i bought this that day, walked across and what this beaut tie in boston on the way home.

By where it once a year on september 11. thank you for that e-mail, greatly appreciated.

The single best chart is an exponential chart.

Or not, so much.

Tim cook likes it, he put up his own of cumulative iphone sales.

This one definitely looks like a moon shot.

But there are some flaws with this chart, it shows total phones sold, not the total number of users.

So, we recreated the chart.

We added a y access to make it logarithmic, so the previous charge looks like it is increasing at a decreasing rate, the second derivative is down-in your world.

You think bj is now a negativ -- is now in negative in your world.

They say that this is september, but calculus august is now.

It is engineering features in all of this, i wanted an upgrade.

It is still a great product.

They still design and make products that work and are reliable.

Everyone is happy with their apple that i know.

But it is on a micro economic basis.

What was interesting in yesterday's announcement is when they talk about how it would be available through the existing phones out there, creating new phones for everyone out there, what is the value proposition for the ios7? do you think that people are bringing in terms of value or features?

Going back to the 5c , i think that that would have had a real spark of making people go in who had not planned to.

I think there was an opportunity for a whole new price point and obviously smarter than i am, they decided to not do that.

A lot of analysts agree with you.

U.b.s. just downgraded shares of apple to neutral.

We are still pulling it up, but the buzz so far is -- is it cheap enough?

It is fascinating.

You have seen this before, miss pricing.

You just had someone on who is an expert at pricing, it is an art.

Interesting.

Alan patricof, giving his wisdom.

I have to admit, i am just doing this for the camera.

And i am doing it for the color.

Coming up, we better look at the new world trade center with the man who designed the original master plan, coming up on "bloomberg surveillance." ? ?

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

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