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tv   Charlie Rose  Bloomberg  November 13, 2015 9:00pm-10:01pm EST

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>> coming up on bloomberg's best government the story that took the week in business around the world. imagine -- a megamerger, alibaba had its best day ever. it has been a volatile week in politics. our weekly roundup of interviews featured some well-known faces. plus, a glimpse at the year a head a peak at some revealing charts. this is bloomberg's best.
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hello, i am alix steel and welcome to bloomberg's best, a hour touriew of the of the week's top stories from the u.s., europe and asia against with news that has implications for banking security across the globe. >> federal prosecutors are calling this the largest death of consumer data from u.s. financial institutions in history. suspected hackers were named yesterday. joining us from dz with insights is tom kellerman. perhaps, you could put this into some context as to what the ramifications are. >> he called it breathtaking. that is accurate. this was a crime syndicate, much
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like the mob of old that had its tentacles in all kinds of businesses. they were hacking into financial institutions and financial publications to collect all kinds of consumer data. including security manipulation. howo we have any sense of they were able to track them down? packs, wereof these being investigated individually. the early ones included e*trade. that was being investigated out of atlanta. at some point, they thought it looked like something else at j.p. morgan. fbi officers and prosecutors honed in on the group. it had tentacles around the world. there is an israeli component. servers were in egypt. it has really got many layers. westin saty, david
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down with moynahan, chief executive at bank of america and we asked him how this effected his company. what we do is we defend. in terms of indictment from one of the things that i see going forward is the cooperation among institutions and governments has continued to move forward. >> i want to turn to tom kellerman to ask what moynahan was talking about. that collaboration. how strong is that and could it be stronger? why is brian moynihan so reluctant to say when he has been targeted? financial institutions need to believe in preserving trust and confidence in the security of their systems but more importantly, the secure that the -- the- the sexed or sector does have collaboration with the government.
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these hackers are not actually behind bars. mr. and mrs. big behind the syndicate are still walking freely behind the iron curtain. beer, beer, we want more beer. manus: $107 billion. the merger will make the industry's biggest deal. let us get more details on the deal. is a relatively complicated agreement and it has taken a number of years to get there. it, it hashink about been exactly eight weeks since miller came out and said -- intends to make an offer for it. executives and shareholders of both companies started disappearing for meetings before that prompting speculation.
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you can go back to last year when as a b miller failed to buy heineken. what was seen as a real defense to prevent its acquisition is really kicking the merger talk off. -- itreally to understand is easy to understand why. sab miller is the world's second largest brewer. the economist said they will be a behemoth. part of the world's top 10 companies, also with 30% of the world's market share for the beer market. one in three pints will come from this combined entity if it goes through. the combined entity would have a footprint that extends right throughout the world. it is easy to understand why this took a while and easy to understand why regulatory hurdles, there are still many to clear particularly in china and
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the united dates. they do not expect a completion until the second fact -- second half of next year. china, 11 week highs today. a volatile time when it comes to markets on the mainland. what is going on here exactly? a five month freeze on ipo's and it came up amid that equity route. since we have had the rebound, it looks like authorities in china and beijing, the security regulator are a bit more confident. they have announced that by the end of the year, ipo's will to makeith some changes it easier for investors and companies listing and also easier and more structured for the market overall. giving lift to stocks today. the agent shares turning positive. swinging between gains and losses of the chinese market is
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doing particularly well. the shanghai composite and the csi -- are key gainers. come asshare offerings the security regulatory commission deems that the market is healthy enough after that 5 trillion -- after that $5 trillion rout in the summer to sustain new listings. individual investors will see some rule changes that will reduce the amount of cash that bidders need for ipo's. --t may a late the concerns foreign investors not necessarily convinced. we have not seen a huge amount of four and in lows. we have seen for an funds pulling money out of these equities. a are not convinced that the there haveve seen -- been some notable predictions that this market could see a big
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drop by the end of the year or at the start of next year. a roller coaster ride in d. issue ofthe larger valuations. how chinese companies are valued. evaluations are 23 times earnings generally. that is the level that these stocks have been priced at. that guarantees gains on the first day. in true reflection of where the market will be headed. csrc has come the up with some tangible rule changes that will make the market more accessible and transparent. that is what foreign investors will be watching as china resumes ipo's. ♪
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alix: welcome back to bloomberg best. we continue our review of the top stories from the trading week with the day of record-setting else for the chinese e-commerce giant, alibaba. the 11th of november turned out pretty well for china. alibaba's single day promotion --e world -- three wrote
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>> big numbers in d. by midday yesterday, they had passed through last year's record of $9 billion and by the end of it, there were nearly 2 million delivery men on the road in china delivering goods. final tally from $14.3 billion in sales. it started off with this star-studded variety show, adam lambert, kevin spacey on a youtube video and they actor from the james bond film. what is significant besides the corporate success is that the chinese consumer is powering ahead in it time of the chinese economy slowing down. it shows the movement from the old to the new economy as the government tries to power the -- and power -- empower the consumer. they are looking at becoming global.
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let us see what jack ma had to say in china yesterday. >> 11-11 from this day starts for china and will go to global. in the next five years, we may be in tokyo, paris, and maybe new york. that 11-11 is a great day for all consumers and every small business. >> this was touted as a successful first visit by modi to the u.k. our business there is extremely strong. we have been there in one way or another for 80 years. we have -- it is our eighth largest market. we have $600 million in revenue there. 50% of the market there. strongest world market share the
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-- there. india is under branded. india, we have 50%, only 600 million. my view, it is extremely strong. it is extremely attractive. if you look at the 25 year and gdp for population growth, india will be the third-largest world economy and it will have the largest economy i population. it clearly is full of promise. i tend to believe that in a 200 year blip in history, going back to the early 19th century, the bricks of the next level that that is where they will be again by 2025. we are bullish on india. india is the last brick standing. russia is in trouble and brazil is not good, china i am a raging
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bull. by -- but having said that, there will be bumps. india for us, the numbers are growing by 10%. october was extremely strong. it should have been because october was a week month last year. china was strong. counter to what we saw a earlier in the year, october was a strong month. india, i hope the strength will continue. they were a virtue a year ago but now they have become a bit of a vice. the future depends on the success of india. we have a vested interest. >> it was a record night last
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night where a china's -- a chinese billionaire paid for a painting of a reclining nude. $491 billion worth of art still. a mixed night. there are concerns that the booming art market may have peaked. >> $500,000. >> gavels are pounding at new houses thisuction week. more than $2 billion worth of art on the line. outcome may hinge more on action in washington, beijing, and moscow than on the kosovo andliechtenstein -- picasso liechtenstein on the walls. >> you will not see the kind of death-defying from collectors in the past five years. art guru grewal -- are
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says she is holding her breath. it came in at the low end of estimates. $377 million. ae morning after, here's think 6%. auction houses will have to fight harder to tempt sellers to part with their art. >> it is a dance to the death. >> a guarantee is the top weapon. the seller gets to walk away with a promised amount regardless of whether the piece itself. sells.her the piece the seller agreed to part with the work on the condition that christie's would do a special option around it. event was a success. the reclining nude be pre-sales.
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there are factors that auction houses cannot control. at the macro level. janet yellen impacts the art market. >> you have individuals with a tremendous amount of cash. you have artificially low interest rates. the era of cheap money may soon end and with that the power to buy top and art. futures are pricing a 70% chance for december interest rate hike. >> if i were a seller, i would say sell now. >> mixed sales could be a sign that the bubble is going to deflate in 2016. ♪
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alix: welcome back to bloomberg best. it has been an eventful week in politics around the world but the effects will be felt in business and finance. british in europe where prime minister david cameron is seeking to redefine the relationship between the u.k. and the eu. the story.et back to david cameron set out his demands on european union membership.
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it will happen midmorning. he is due to publish a letter. for tighter welfare rolls. that may be resisted by many of the countries in eastern europe. let us get down to the details of how this will be received. what are the early indications from brussels. we have been waiting for this letter. this is the starting gun being fired in a process that could take a while. it may actually produce some results by the end of the year. >> that is the hope. the hope is that at the next summit meeting in december in brussels that they make some good progress on the negotiations with the u.k. and cameron over the demands about a renegotiation of the uk's relationship with the eu. the first -- they talked about it in october and they asked cameron to put it into writing.
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supposed to come today. other eu leaders will be looking at the details of that to see how far cameron wants to push it in terms of trying to renegotiate how the u.k. fits in to the eu. >> does any of this record are a treaty -- require a treaty change? >> what cameron has said about what he is thinking about in terms of welfare payments and welfare eligibility and migrant from other eu countries coming in today u.k.. that is technically illegal under the treaties as they stand now. as they push forward with something like that, you'll have to see some kind of treaty change. tookw, to a handshake that 70 years to create. leaders of china and taiwan met race to face at -- during the weekend since the civil war split. singapore was the host.
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>> you can call it a handshake that painted a thousand words. it lasted just 80 seconds but was negotiated for more than two years. something few thought possible. acknowledgeder taiwan's right to rule it self. that conflict considered one of the biggest unsettled complex of the last century. they had a 15 minute closed door meeting. the talks to be pragmatic and straightforward. he stressed the need for more dialogue. interesting to note that there were no national flags. both referred to each other as mr. as opposed to president. they went dutch. they split the bill for dinner after that meeting. it all shows how delicate the protocol balance really is. that we may be a
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step closer to a possible reunification? >> there are two sides to the coin. it could be seen as a step closer to china's dream of reunification at the meeting is more symbolic than significant. go monthsled to before taiwan's general elections. the nationalist party, he is trailing way behind the opposition party leader. this meeting was intended to shake up the race. public opinion polls show that most taiwanese prefer the current state of relations with china. they reject reunification. reunification is at this point just an idea. not a pipe dream. >> paul ryan. i want to cover a lot of policy
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stuff. guantanamo oh. the co-equal branches spoke once again and said guantanamo should not be closed. the administration is being a little bit vague about whether the president may use executive action. you have been critical of him using executive action on immigration issues. what is your message on whether they should use executive action? >> they can't. passed a billay with 91 votes, well over what is necessary to override a veto. the language is clear that he cannot transfer prisoners during this is language that was put in the defense bill by democrats when they ran congress. in the early part of the obama administration. the president said, mr. speaker, i am trying to fulfill a campaign promise. >> the president has written an op-ed on bloomberg's view of the the benefits
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transpacific partnership. i want to read you one part of his op-ed -- companies that sell their goods around the world tend to grow faster, higher or employees and pay higher salaries than companies that do not. on average, export supported job take up to 80% more than other jobs. what is your view on that? it stands to reason in the sense that a lot of things that are non-traders like haircuts are not high value added sectors of the economy. exporting -- in the way of primary products. you are exporting sophisticated things like technology. readdisclosure, i have not the dpp. -- tpp. it is enormously long. deal andomplicated
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most people have to read their way through the small print. >> they did try to summarize parts of it for the american public. i agree, it is a slog to get through. will it get through congress? to bet ad like significant amount of money on smallecause, however the print read them it is going to be relatively easy for the president and his opponents in congress to find things to object to. the president's power is beginning to end and it was not that great and congress to begin with. there have been of you i am ratheress -- pessimistic about how this will fare in congress as we get towards the final phase of the obama presidency. anyone who is uncorking champagne in anticipation of tpp
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, is missing a crucial point. it still has a huge hurdle to get across in washington, d.c. >> good to have you on the program. after yesterday's vote, how long would it actually take to get a new government in place? a lot of power is in the president's hands. >> now is the time of the president. there is no set timing and the constitution for this part of the process. the cop -- the president gets to set the timing. he does have wide discretion on what happens next. he does have to meet each of the parties before announcing a decision. the socialists say they can form a minority government but the president cannot appoint a socialist p.m. -- prime minister. he could try to find the prime minister elsewhere. also, no early elections can be held until may or june of next year.
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he still has to deal with the parliament as it is. ♪
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♪ "bloombergsipra best". i am alix steel. here are some of our favorite
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interviews this week. >> we are very thankful for the united states. without the american tourists who come to my city, i would never learn to speak english. -- people say why doesn't alibaba come to america? when are you going to compete with amazon, ebay. >> if we go there, we want to help small businesses. ofhave such a huge demand china consumers online. we need good products, unique products, and the usa has a huge
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potential. years, i want our team to be able to invest in high technology, helping them to grow. helping them to grow not only by money, but to come to china. emily: amazon is also going global. they are focusing on india. you are focusing on russia. when do the world's biggest e-commerce companies collide? alibaba have a different model. we are a platform. we have 10 million small businesses. we believe every company can be amazon. if amazon is a great apple. we are the apple tree.
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computing, using our logistics system, using our payment system, these are the services. we want to enable every company to be e-commerce. we are not an e-commerce company. i don't think amazon and us would compete. a lot of companies like amazon. emily: should amazon be worried? >> i don't know. if they worry, they worry. >> how do you see the media landscape? isthe biggest issue is who in a good position where the consumer is going. ofyou are the opposite old-fashioned, fyi. >> thank you. facingue the tv guys are is that 75% of millennials watch tv down from 95%.
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by the way, our ratings are up 10% year over year. our broadcast radio stations that are digital are up more than that. the consumer clearly -- and one of the issues with tv, what is tv? it is changing. it turns out the networks are retailers of programs. a new retailer showed up, called netflix and others. i think that has had a big impact. toy have a lot of levers pull. they are in the content business. i'm not holding any benefits for them. on the other hand, radio has always been america's companion. we are sitting next to you in the car. >> we depend on burning fossil feels.
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everybody is at a computer. you have your electric cell phone, everything depends on electricity that is produced largely by burning fossil feels. we have an extraordinary contingent and the united states of people who deny climate change. so we are not moving fast enough. if all the energy in the u.s. were renewable, we would change the world. windnexploited resource is energy off the east coast of the united states. there is enough to power the whole place. caffe from minneapolis -- kathy from minneapolis asks overhang thatible the game may change. reason we are
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raising capital is to have a allows us to that withstand a black swan event. unless you have a strong balance sheet, you don't have a business. from the bottom of the industry in terms of capital strength to the top. that is very important. we are very careful about our risks. we have been reducing our positions good it is quite likely positions. there will be a dramatic event. >> dramatic how? >> there has been a long time of low interest rates. it is likely they will rise. there will be impacts. as a financial services company, we have to position ourselves
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defensively. >> there's a lot of speculation regarding the futures market that there will be a rate hike of 25 basis points. if that happens, what would it do to bank of america's business? when you have fiv $500 million and rates going up, it's a good thing for a bank. that being said, we have positioned the company and built the earnings stream. made $4 billion plus in the last quarter. it would make our life a little easier. ♪
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♪ >> welcome back to "bloomberg best". you can always find fascinating features on bloomberg television and bloomberg.com. we begin with a glimpse into the year ahead.
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facilityrt visited a that could be a solution to the states persistent drought. sam: this is the pacific ocean. it is definitely in my top five. surf on it, in it, or just stare at it and think about your place in the universe. one thing you might not immediately thing to do is drink out of it. 2016, that is exactly what the residents of san diego county will be doing. we are at the site of the ,arlsbad desalination project the largest in the western hemisphere. it will produce up to 54 million
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gallons a day. that is enough to fill an olympic sized swimming: every 18 minutes. sam: everyone knows that california has been going .hrough a serious drought desalination has never been an obvious solution. commonof this scale are in saudi arabia and israel, but in the united states there has never been anything like it. fair to say that southern california is facing some of the same challenges in the middle east? that southern california sold their water resource issues historically was to import. that is not as reliable now. the majoritygets
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of its water from the colorado river. the last years have been drought years. the low hanging fruit is gone. sam: now you have to create new sources of water. >> that is correct. sam: this is where it all happens? >> this is where we take out the salt. sam:, this is how a desalination plant works. you take in seawater, reverse 50%sis, 50% freshwater, super salty wastewater, which gets dumped back in the ocean. convertingdea of seawater into drinking water then runs into trouble. >> reverse osmosis requires pressure. that pressure requires energy. megawatts between 33
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and 38 megawatts of power. we are the largest power user in san diego county. sam: all that power cost money, and that is why desalination has never worked in the united states. the developers of the carlsbad plant have spent $1 billion trying to make it as efficient as it can possibly be. one key part of that efficiency is this room full of orange tubes. >> it is still under high pressure. we run that through our energy recovery devices. by doing that, we are able to recover about 40% of the energy used in the plant. sam: it mitigates a considerable amount of energy that a plant like this requires. >> correct. sam: in spite of this efficiency, disseminating water 30% more than importing it. it means water bills will go up when the plant goes online.
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generating 54 million gallons of water a day may sound like a lot, but it is only 10% of san diego's water needs. if you ask is desalination the solution to california's water crisis, the answer is, well, no, but it will probably be part of the solution. as climate change makes dry places even drier, we will reach sources arer water available, even those that seem impractical today. the future of california's drought is uncertain, but one thing is for sure, people will keep looking out at that water and thinking, that could work. ♪ >> no pain.
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will increase from week to week the velocity. >> that allow for detecting collisions. sure that make certain things are not exceeded. [speaking german] ♪ >> this is a robot that is
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suited for contact to humans. it safeguards against collision. if i contact the robot, it stops. there is a proximity sensor in the griper. it will also stop. the robotse my hand, will go back into the intended operation. ♪ >> to support elderly people in the workplace, you need technology like robots, but you can only support them with robots when this type of support is safe. projector ise, a curtainng a light around the robot. once it is interrupted, the
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robot will stop. avoid any contact between a human and a robot. it makes the workplace more flexible. you see were the restricted space is, and where the robot is moving next. it must be achieved so that the robot cannot harm the human. this is for safeguarding the robot. movings where people are and where the objects are located. this kind of floor can be used spaces,lish restricted especially close to the robot. if i go to these spaces, the robot stops.
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perspective of , collaboration in a highly structured environment, where people are working. towardsthe first step collaboration in a domestic area. especially in such environments, -- ♪ it hit thatthe icon put the district on the map for the rich and stylish. these days, dancing to a different tune, drawing a crowd that is hungry and ambitious. is offering infrastructure and support as a financial hub. now the number of businesses is increasing steadily, rising 12%
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in the first eight months of 2015. >> this is one of the communal workspaces that have launched. some critics point out that quantity does not mean quality. >> the number of entrepreneurs and government support has increased, but the quality of startups has not improved much. >> he is a venture capitalist. he says many can't grow profit because of the limits of the domestic market. firmslogy and information made only 15% of all new businesses launched in august. these are considered key to economic growth as they have the potential to expand overseas. tell us about this. >> show me your hand. >> you can feel a slight
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vibration. what is it telling us? >> that it is dry and you need moisturizer. it assesses the condition of our users skin and environment and offers advice. they companies are chasing a piece of the action. way says it is getting $26.5 million from major firms. >> i was cautious about corporate with big firms. the way they work so far, they are cooperative and offer good advice. >> many startups remain wary. have deepolumbus pockets and deeper political connections that can make life if a cult for a potential disruptive. still, moon has high hopes and is optimistic about her existing with more established businesses. ♪
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♪ >> as we wrap up this edition of>> "bloomberg best", let's look at some of the charts. ceoterviewed the t-mobile about the new streaming video service. your subscription growth has been crushing the competition, but you have been able to sustain margins because you have been able to sign up so many people. how many do you have to set up to upset the cost -- offset the cost? >> you said shrinking profit margins, our growth has been huge. >> if you look at your average it is loweruser, than the competition because it you are able to sign-up so many subscribers. that is ok for you.
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what happens when you run out of levers to pull? >> it is about solving customer pain points. you really think we will run out of room to solve pain points? the most important part is that your questions are relative to horizon and at&t, who are losing customers. they had excess margins and are in a heap of trouble. >> i will take a look at a chart of portugal. we have some portuguese data out today. as you can see, quarter on quarter, portuguese data fell to 0%. there is a big disappointment. the other thing in portugal, political strife, stability of the government. here we have a chart of german-portugal 10 year spreads. it has been headed higher. it is at its highest level in
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four months, so uncertain government and we growth, back to trouble. >> this is the commodity spectrum. i asked you what will stop the .lide goldman sachs said only a substantial rise in chinese demand will be sufficient to balance the copper and aluminum markets. thestrial metals are at lowest levels in 5-6 years. the selloff is not confined to industrial metals. the bloomberg commodities index is at its lowest level since 1999. commodities from the index down by 20%. the worst performer is nickel, 38% lower. crude is down 24%. gold has fallen to a 2010 low. there is only one commodity that has risen, cotton, up by 2.9%. >> that is it for "bloomberg
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best" this week. you can always get more business news at bloomberg.com. i am alix steel. thank you for watching bloomberg television. ♪
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♪ announcer: from our studios in new york, this is "charlie rose." charlie: joining me on the phone from iraq, embedded with the curd troops in the fight against isis. tell me what you have seen and heard today. what is the future of this fight? >> all day long what we have seen mostly are these tremendous themrikes, dozens of striking sing. we have a

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