tv Bloomberg Technology Bloomberg November 30, 2017 5:00pm-6:00pm EST
trillion to the federal deficit over a decade. it finds economic growth from the tax cut only will offset 407 billion dollars of the $1.5 trillion total cost. increasee bill will growth more than other models so far, but the analysis complicates the gop argument that the overhaul will pay for itself. house republican leaders plan to seek a two week spending bill to fund the government until december 22 two of lloyd a shutdown. current spending is set to run out on december 8. the plan has not been finalized, but it will buy more time for negotiation with democrats on a longer-term funding plan. trump will deliver his first state of the union address on january 30th. paul ryan formally invited him today. he called it an opportunity to lay out the work that needs to be done for the american people.
john kelly has denied reports of that the white house is planning to remove rex tillerson and replace him with cia director mike on pao. global news 24 hours a day powered by more than 2700 journalists and analysts. this is bloomberg. emily: i am emily chang, and this is "bloomberg technology." coming up, the bitcoin waiting game. the ceo gives his take on the volatility of the world's most traded cryptocurrency. shines onspotlight google. how will big tech respond? and a if i front -- ai at the front lines.
how machines have affected social media. inhnology stocks rebounded thursday trading from the worst drop in more than a year. while the nasdaq is recovering, the dow staged the third triple digit gain in a week. where are we in the market cycle? our equity strategist joins us from new york along with our guest host for the hour, david kirkpatrick. gina, i will start with you. where are we? you said these stocks could be subject to rotation risks at the end of the year. is that what we are seeing now? >> we saw a little bit of it in november. unlikely, given history, that stocks that outperformed in january-november all continue to outperform the way into december because you typically see rotation in december and january.
they may face a near-term headwind. that said, when you look out over 6, 12, 18 months, tech is generally ask acted to produce robust earning growths and market expansion. the fundamentals are there. there is nothing to suggest in the price trends, even with the modest pullback yesterday, that there is anything ominous on the horizon yet. of months last couple we have been debating whether the issues around fake news and election meddling would impact the markets. we have not really seen that yet. do you think there are big risks at play? >> i think there are, but i don't think there is any impact on stocks in the short term unless there was a dramatic development we don't know of now. i do believe -- and i have been talking to people about this recently -- that unless the big morenies take much
concrete efforts van they have taken so far to address fake news and other issues causing great concern, their stock will be affected. this is a long-term social trust and whether that would be impaired. i do think they will probably ,ake some gestures over time but at the moment, it is not looking that promising. annalee: how would you differentiate between short-term and long-term -- emily: how would you differentiate between what we will see in the short-term term and to the long-term? >> with investors who are looking to catch up and find opportunities, they are looking at value stocks to give them pop at the year end. that makes sense given what is happening with financials, regulation, potential for tax reform, and what we are seeing in inflation and the 10 year treasury. when you are looking over 12, 14, 18 months, what you see is
the earnings growth rates for tech are really tough to ignore. even though valuations are high, they are nowhere near where they were in the peak, and a lot of not to get into text. frankly, fundamentals were much -- are much stronger and we have intoeen that embed itself stock prices. there is still a longer tail i think, secular tailwind for the tech sector. but you cannot ignore in the tremendous gains we have had over the year that continue to power the sector. emily: with fundamentals being strong, david, what signs will you be looking for that some of the risks you are concerned about are having an impact? i think it's long-term. we have seen some interesting stuff in recent days and weeks
from the tech giants. i actually think it is a matter of what congress decides to do, and that seems to be more or less nothing in any near-term scenario. to be honest, i do think we have , but it's not going to be reflected in the stock price certainly within the next few months. ask me again in six months. gina, say there is regulation. would that have an impact? would.ink it the reason i say that is because other sectors, especially financials, have actually decreased in regulatory pressure. general investor sentiment perspective. we have not seen any real decline in regulation for financials. we have at least seen a decrease
in the rate of regulation and maybe even a halt to regulatory pressures. in that relative comparison, just the perception that regulation may impact the tech defeat it compared to financials. to's --d, if we start when you compare to financials, it is a little bit of a headwind. gina martin adams of bloomberg intelligence, thank you very much. david kirkpatrick, you are sticking with me for the hour. aanwhile, bitcoin has had roller coaster week, soaring before crashing. lloyd blankfein, ceo of goldman sachs and mike bloomberg, founder and majority older of bloomberg lp, sat down with alex steele to see -- alix steel to talk about if they see value in the cryptocurrency. >> it's not for me, but there
were a lot of things that weren't for me in the past that worked out very well. if you told me it was 20 years ago and it worked out i could tell you why it worked out, but based on everything i know, i am not guessing that it will work out. but i am not going to say it's a fraud. i can't. >> i think people confuse bitcoin with bit chain. -- block chain. there is a technology where you can have different accesses to data, different people control it, you can see who is doing what and that sort of thing, and there are places were that is useful. in fact, the bloomberg system is a block chain. it's just that instead of having users control it, we control it, but it has all the asked -- attributes of that. ofhole bunch cryptocurrencies are started. every day you have a new one. that's something different. whether or not the governments of the world will lose control
of monetary policy, i am skeptical. something that moves up and down 20% in a day doesn't feel like -- the currency, but it's a commodity. you move up in the commodity business. talk to me about the unregulated trading world of bitcoin. where is the fraud going to come. >> the whole concept is -- well, first of all -- >> is it buyer question mark seller? price discovery? people are using it to perpetrate fraud because you cannot trace it. so it's cash. it's hard to pay with cash sometimes. >> the world is going in a different direction when you think about it. look in china. everybody is paying with their smart phones. streets really
need help. instead, they are begging for money. they have a sign with a code, a qr code, if you want to give them money, point your cell phone and they have a bank account, and that's the way they are getting their money. china is heading in that election, and they have gone a very large way, as has india, doing the same thing, getting rid of cash. you canhe reasons is stop the black market, stop the drug dealers, track where currency is going. america may not be ready to go there, but we are going to be left behind if we don't because this is a much more efficient way of paying for goods and services. they are going to know what everybody is doing with their money. >> of course they are going to know. the google already knows. >> and amazon. are you not talking to any of your guys?
know, we'll see. if it works out and gets more established and trades like a store value and it doesn't move them there is% liquidity and it, we'll get to it. small business people have to think about their bitcoin strategy? i would worry about opening the doors to people who want to do business planning. ceo oflloyd blankfein, goldman sachs and mike bloomberg, founder and majority owner of bloomberg lp with alix steel. we are watching shares of the semiconductor. apple designed its own power management chip to use in the iphone. dialogue relies on apple for about three quarters of its revenue. coming up, serious shakeups at nbc could have serious repercussions on ratings. we will have all the details
story rocking a the media world, the fate of nbc's flagship morning show. matt lauer was fired for sexual misconduct. the today show is locked in a fierce ratings battle with abc's good morning america. matt lauer was likely to anger much of the network's coverage of the olympics in -- anchor much of the network's coverage of the liv-ex in january. olympics in january.
new revelations are still coming out. how much will this hurt nbc? what investorsly in comcast will be wondering. the station had been a leader in the ratings. it had started to die down in key demographics. the cost of effectively having for people just talking to each other meant it was a real revenue generator for nbc. there are lots of names floating around. as you mentioned, the winter olympics are something he was going to be heavily involved in. that was very important for nbc. that could be an opportunity for them to roll out a new lineup. emily: let's talk about the ratings in the revenue here. are we expecting an actual impact in the numbers?
>> it's interesting. matt lauer is not as popular as he once was. he once had strong recognizability among viewers. ofre were a number, like 11% him as ars who listed favorite tv personality, but he has not been as popular recently. weekend -- weak ened. nbc is going to have to contend with finding someone to replace him, but he has always been a polarizing character anyway. emily: cbs this morning also reeling after charlie rose was fired. also over sexual misconduct and similar allegations. how do you think this will shake up the morning show seen in
general? you have two shows essentially reeling with their main star gone. time in a fascinating tv. we have seen on the cable news bill o'reilly got kicked out because of misconduct and allegations that they still denying. fox news hasn't really found a think the same footing. that's still the number one leader in cable news. , it'sarlie rose show probably too early to tell. but it is an opportunity to bring new, fresh faces to the network. it's going to be interesting to see if they are going to be able to find the talent. from some i have spoken to, agents, they have said it's not
to find stars. they are hard to come by. bloomberg has ended its production and distribution arrangement with charlie rose. replacement talks to come shortly. thanks so much. now, to another story we continue to watch, and reports about the culture at google and a history of inter-office relations that have been a focal point of frustration for employees. by our techd officer and our guest host for the hour, david kirkpatrick. alastair, i will start with you. relations this week about andy rubin leaving after having an inappropriate relationship. have another bigger picture story about how inter-office relationships have been a longtime trend at google.
that is not necessarily new to many of us, but in this climate, it is really hitting home. >> in a story written by a former colleague of mine. he basically reported a long history of top google executives butonsensual relationships, often relationships with subordinates. these were often not reported. some came out in the media a few years ago, and the general effect on other employees at that they felt it was not as much of a meritocracy as may be outwardly google looked, and it caused a lot of concern to women. some women, for example, did well, but they had to spend a lot of time with male executives. gotas implied that they time with executives because they were good looking and things like that.
>> many of these relationships were well known. melissa meyer, amanda rosenberg, a new relationship with david drummond. the chief legal counsel and one of his subordinates. think this is problematic? and if so, how problematic? >> it seems problematic for google. outinformation also pointed that the company is making a very determined effort to change its policies to enforce its rules much more methodically. but i think all of us, as you ,now, as you mentioned yourself who have covered this company have observed that we are in a different moment now. i think the entire industry is moving toward more awareness of
what is proper and what isn't and to try to really come up with rules and policies that men in particular from abusing their power over women. i think it's worth noting that , more thanrobably any other big company, the most effective machine for producing extremely talented and effective women leaders in tech. so, that's a weird possible sort of contradiction. see they have can had problems with these power relations and potential abuse, they also have generated a next ordinary number of very talented women technology -- a very, very extraordinary number of talented women technology leaders. have spoken to women who think it's the best place
they've ever worked and some who think it can be sexist and misogynistic. alastair, what you think about the way they have handled things recently? these are very recent situations where people were allowed to leave quietly. >> 1.i wanted to make, there was a quote in that story that i one point i wanted to make, there was a quote in that story that a woman said she experienced bad things but less bad things than at other companies. google's approach to this type of thing changed four or five years ago. think people being asked to leave is an example of that. the problem is, they allow them to go. and in and andy rubin's case, i $100 they gave him million and he got a great job at uber. emily: thanks so much.
is in talks to invest in a chinese facial recognition startup. they are keen and owning a sizable stake but have no interest in exerting control over the ai startup. it is valued at more than $2 billion and is considered one of the more it fans to players in machine vision technology. will goes through, jack ma have corralled to major facial two major facial recognition startups.
morgan stanley shows apple gained shares of activated smartphones this year. is battlingig tech online extremism, and now they say they are making major progress. how are they doing it? that's next. if you like bloomberg news, check us out on the radio on bloomberg.com, and on sirius xm. this is bloomberg. ♪ retail.
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of videos posted by britain's far right extremist group, britain first. >> extreme violence and extreme terrorism are something we know to be very real and it's something the president feel strongly about talking about every single day. >> u.k. lawmakers are urging theresa may's government to form only -- formally cancel the for a state visit to president trump. the u.s. has delayed the trump trip because of the concerns about the scale of potential protests. the saudi energy minister says the kingdom's output capacity remains relatively normal. he spoke to bloomberg after the opec conference in vienna. >> there is no erosion to speak of.
smallis only one injection, and it's in the .rocess 12 and a half is basically intact. >> global news 24 hours a day 27ered by more than hundred journalists and analysts in over 120 countries. we are joined by bloomberg's sophie kamaruddin with a look at the markets. k. dow hit 24 it happened here in the states. sophie: it happened. hk takes the that queue and starts on an upbeat tone. from thesee a recovery selloff we saw thursday in asia. plus, a proverbial laundry list of things to watch.
removing tens of thousands of sermons and lectures by an al qaeda recruiter. facebook says it's ai tools are spotting 99% of islamic state and al qaeda content on their platform, something theresa may mentioned. >> we must also step up our efforts to crack down on terrorist use of the internet. companies have made tremendous progress on this. improved its ability to detect and remove terrorist content. anly: joining us now is advisor to the counter extremism project and my guest host for the hour, david kirkpatrick. explain the significance of some of the content removal we have seen more recently. >> absolutely. i remember being your with you in studio a couple of weeks ago
after the tech hearings. we have seen some progress. we are not all the way there yet. the move by youtube is pretty significant. it's something my organization has been pushing them to do. we have been writing letters and putting pressure on them. there is an op-ed today by our and presidento bush's former homeland security adviser pushing to get this content off their platform, and they finally did it. now, when you search for videos that were there by an extreme jihadist cleric who inspired all over the globe, those videos, which violate the terms of service, are no longer up there in most cases. having said that, he is not the only individual, not the only terrorist, not the only problem on these platforms. but this is something we have been calling for for a long time. emily: we have a quote from that
op-ed. they say it's only half the battle. companyfocus is policies, industrywide standards and technologies that will be paramount in keeping the public safe. how much more of this content is out there? how hard is it to spot? how quickly does it go up online? >> there is a lot of content that is generally problematic, but we are talking about the worst of the worst. individuals and organizations that are on the terror organization list from the state department, individuals on the treasury department sanctions list. individuals you cannot do financial transactions with we don't think should have safe haven to operate on facebook, twitter, wordpress or smaller platforms. and there are solutions out there to get some of this which, that
content violates the terms of service in our opinion. you need to stay on top of it. it's not an imaginary problem. we have seen it across all the cases of terrorism that occur, most of the homegrown cases here and in europe, there is an online radicalization element. it is something we have been very focused on and i think capitol hill has been very focused on it in right of recent tech company hearings earlier this month. it is certainly not an imaginary problem and it has been a problem for a very long time. david, what you make of this? david: it's interesting considering we have just come through a time and are possibly still in a time when tech companies, facebook and google in particular, have been getting regularly hammered by politicians and the media for a variety of antisocial projects taking advantage of their software. when youg change intel
have theresa may saying something very flattering about-face but and an op-ed from the new york times praising google and youtube taking this on. but there is so much more to do. i am excited to think that software can make a significant but i getis problem, a little nervous about the general notion that the companies need to be the arbiters of what is allowed. ultimately, i don't know whether companies should trust nonprofits or corporations to decide what speech is or should not be tolerated. emily: i know you have been working on ai to combat this problem. is ai equipped to do this or do humans need to be involved? >> there are technological solutions out there. our organization has been officiallyt is not
ai but is a database technology solution. it was developed by a doctor at dartmouth college who is an advisor to our project. for child pornography, they images.y filter out you can imagine a similar system set up for terrorism. they take the worst of the worst and the technology filters it from ever resurfacing again. this can be done with videos, audio, still imagery. that's one solution where you don't have to have a debate over how smart is the ai. in this case, it is a human identified problematic content, you archive it, and the content cannot resurface or perpetuate indefinitely online. that's what we are pushing for. one of the main issues here is there has not been as much
transparency as we would like. you are exactly right, david, makingompanies are not national security efforts, per se, but we might need an independent arbiter to house a database for this. that sort of how the model works on child per not her fee at the national sent -- child pornography at the national center for missing and exploited children. we propose an analogous model where there would be a database that can do that. i would say one other point. you said pressure from the hill, pressure from the media, pressure from organizations like us, but also advertisers who started pulling their ads off youtube because they were running in front of problematic content. it's a case study of how multidirectional pressure from a variety of sources can make an impact. i think we are going to need to keep pressing at it for more. david: do you think -- does your
group believe that government ought to essentially push for or legislate the creation of the kind of body you just described, or is this something you think that in should emerge simply from industry activism question mark i mean, i am frankly skeptical about the latter, but what do you think? >> right now, there is a collaborative effort between the tech companies. we are not caching -- pushing, per se, for legislation, although you have seen a recent sex trafficking bill that the tech companies are on board with and be honest ad act about ad buying on these platforms. it might take some regulation on the margins or at least even reporting or best practices to get them to act. having said that, there has not yet been legislation and we have seen progress. there may be legislative solutions out there. we have not pushed for a
specific piece of congressional legislation on this. lots of work to do, and good work that you are doing, senior adviser for the counter extremism project. david kirkpatrick is sticking with us. top this weeke for blue apron. they have appointed glad dickerson as new ceo and president. he served as cfo since joining in february last year. the stock price has been struggling since june, the share price losing nearly 70% of its value. announcedalphabet has that intel's former exact well -- one of intel's former execs will help run its new business. a datahis year, she led business.
the bloomberg 50 is out. from finance to politics, entertainment and tech, bloomberg is highlighting the people who defined global business in 2017. this is the seventh year of the bloomberg 50 and the second year bloombergeared in businessweek. megan is here to tell us who made the cut in tech. so, megan, who made the cut in tech? you areell, someone just talking about, elon musk. i am personally thrilled to hear about the transit between o'hare and the city. when you look at what he did the rocket space as well as in the driverless vehicle space, he was a clear choice for us. he is someone who, even when we tried to make a list where you get rid of the usual suspects, he still stands out.
another one, jeff bezos. of course, amazon, the washington post, and now potentially the total reinvention of the food and grocery market with the stunning move into whole foods and that space. i think we are all watching to see what shakes out there. those are just two of the people who stand out from tech as well. emily: other tech notables, the founder of softbank trying to negotiate a big stake in uber as we speak, the senior vice president at google. david, what do you make of these picks? david: i think they are great. i think maybe it's the first list of this type in a long time that didn't include mark zuckerberg. that's got to be controversial. i'm curious what megan has to say about why they left him off? get intoe wanted to this space, we wanted to say ok, we don't want this to just be the people you read about every year. i think mark zuckerberg could've been a candidate this year
because of what facebook didn't do in terms of safeguarding the what they process and have done in investigating it. what we do have on the flip side whatussian botnets and they have done in terms of driving the conversation in 2017. mark zuckerberg makes the usual suspects list, but in terms of who really influenced and drove the conversation in 2017, russia influenced our democratic process and the democratic process elsewhere as well. as you guys talk about all the ife, we're fascinated to see money is going to be driving the trends, innovations, the ai of tomorrow, where he is going to go with that. and the photography in this issue, really capturing him, i think it is one of the best spreads on him i have ever seen. emily: the diane greene pick, obviously, she is running
google's cloud business. some thought that struggled for a long time. it is gaining ground. aws is really the giant in the room. why diane? you are discussing earlier another diane coming on as well from intel. when we look at this list, we wanted to pick out some of the people who, as i said, are driving the next iteration of these companies, and tech is no different than finance. we feel diane in terms of cloud and what they are doing, the core of the business not only in the next year but the next 10 years, she is really at the forefront of that. that is a big aspiration of this list. if you don't know who these people are now, you should. she is one of the names we think really fits that category of people, you should know this person. they are driving the conversation. they are driving the way you live, the way your business works, in ways you don't even know right now. emily: agree, you should know.
david, final thoughts. these things shift every year, but our effort here is to bring it forward and look at what bepening next and who will driving future business transformation. >> there are great names on their like bobby codec of activision, one of my favorite people. gaming doesn't get mentioned as often as i think it deserves to be mentioned. he is a great leader. he has built the company. its stock has been performing fantastically. i think that -- i was pleased to see him at some credit. everything elon musk does is about climate change in the end. i find a fascinating and i think he deserves a lot of applause for that regardless of valuation or whatever. he is a unique, superb leader in society. diane greene, too. that's somebody i have followed for many years. she doesn't get much attention at all and she is one of the major definer's of the world we are living in. it's a great list. i have to credit you guys.
>> great to hear. anyone who plays games as much as we have been will mention activision. emily: he's been playing games for a few decades. megan murphy, thank you so much for bringing us that list. david cook ettrick you are sticking with -- david kirkpatrick, you are sticking with me. coming up, alexa is heading to the office. amazon plans have voice technology incorporated into the workplace. this is bloomberg. ♪
be coming to a workplace near you. the company announced its voice activated tool will handle common office tasks. will allow users to begin a videoconference or prudent documents among other functions. or print documents among other functions. do you make of alexa moving into the workplace? david: first of all, let us knowledge amazon's extraordinary ambition and continuing ability to execute in more places than we could possibly imagine. that said, i think it makes perfect sense. it's almost inevitable. the biggest battle in tech going intelligence assistance that is generally going to be voice controlled. alexa are too much to find the category. we have siri, of course.
facebook is supposedly working on something and will come out with that soon. the idea that this would not go into the office is crazy. giants have to go to ubiquity. the faster they can get these kinds of systems into all of society, the more any individual company that does that is going to get an advantage. with one ofho works amazon's partners employing this idea, i think it would be great to control a printer, which is one thing they mentioned. it makes sense to have alexa pretty much everywhere we go. is amazon staking out new territory? do you think apple and google will try to follow, as they have? david: absolutely. microsoft, google, facebook, apple of course, will be in the workplace, in our personal lives, on our phones, on our
watches, in our car, pretty much everywhere. but the workplace is a logical place for it to go. i credit amazon with getting there first and getting this going first. they just keep defining this space and making everyone else follow them, which is supremely impressive. emily: indeed, right on the heels of breaking into the physical grocery business, it's certainly seems like amazon, more than any of these other big ish companies at the moment, willing to define new territories for itself rather than following others. david: it's unbounded ambition, and successful execution. me, do you asked think amazon is the best managed company in the world? i said it's definitely a contender. it's impressive. emily: impressive indeed. david kirkpatrick, we will be
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♪ >> asia-pacific markets look like they are starting on and upbeat note after more highs on wall street. topping 24,000s points after john mccain signaling his backing for the republican bill. extends the oil curves with saudi arabia and russia standing together. the restriction runs through the end of next year. >> and goldman