tv The David Rubenstein Show Peer to Peer Conversations Bloomberg September 30, 2017 3:00am-4:00am EDT
tom: from new york city, i'm tom keene in for jonathan ferro. this is "bloomberg, real yield." coming up, will it be low rate kevin as the president meets the former fed governor. in this hour, will chairman wars keep the real yield lower for longer? yellen speaks, the nominal yield spikes higher, a little transitory september gives way to a -- october and december.
a real yield hogs, we consider the frenzy over the loan market. with a big issue carried interest rate risk in the bond market. >> during the summer, it was almost as if bond investors were making another run at treasuries. they wanted to get the 10 year below 2% more more time and it is built on the base of market is never going to grow again, we will not see any fiscal policy, it and they had it completely wrong. >> the fed is moving towards regaining credibility so investors are, we know what their plan is, we can make investments based on this and you will see people react in. >> the fed has clearly said this is what we want to do. we want to reload their cannons. sheett to get the balance down and normalize the front-end of the curve. you see the betting odds on the december hike changed dramatically. views low inflation
as a way to continue with gradual pace. the market thinks fed shouldn't touch rates unless we are at 2% inflation. >> i believe janet yellen, that the u.s. economy is time, itning and this has been well signaled and markets will take it in their stride. joining me today, we have a terrific lineup. three pros worried about the thisest rate risk and week, other potential fed nominees. jim king is chief investment officer at block rock -- blackrock. joining me, the cohead of high-yield and -- at goldman sachs. joining us, mark from timko in newport beach, california. this will be a great reset into the fourth quarter this year. rachel, let me start with you. this is an equity chart. guy, belsky, and equity
you look at the equity quiet -- there is bond quiet as well. we are at a historic monthly low at the vix. how big a headache is that for you at goldman sachs? rachel: we think volatility is due to rise in the course of the next year. it is likely to be the result of the beginning of tapering. we are coming out next week with of title live which is the long and winding road. global banks will be unwinding, not from the same starting point, but it will begin to tighten financial conditions into next year between the financial tightening conditions and the potential for political risk and policy risks, there is likely to be volatility and the spreads will be higher. at timko, the basic idea of hard data, soft data, can we
develop a theme? do we have enough confidence in the path of the hard data? >> you brought up a good point and the word confidence. if you look at what yellen said he hurt you and a and recent speeches, she is sounding increasingly confident and i think that is because the labor market is doing well in the u.s., the consumer is healthy, financial conditions are easy, and the global economy is doing better than a lot of people expected. this is giving the fed confidence that they can take a step back from this large balance sheet. the market has mispriced the fact that the fed will go a little faster than most expect. the market for december is priced at about 60% right now, and cumulatively until the end of next year, less than two rate hikes. you are going to see a little more aggressive fed versus what markets are expect in and therefore, the trend to higher rates is likely and we will
likely see the fed move and also other central banks over time start to step away from the support for markets. tom: i want to bring this in, published on friday. really pushes against the fed certitude. the market is greatly overestimating the votes and the commitment to hiking at the fomc, and then he turns within his research note and says the next inflation print has to deliver the bounceback to normal inflation. urgent is it within the fed linkage into the real yield market to finally see actual inflation data, as mark mentions? there was a lot of long-term secular headwinds to sustainable inflation. inflation is definitely picking up and i agree with mark's point. it makes a lot of sense and gives the fed confidence with are, theo where we
underlying economy, the labor markets, that they can reduce their balance sheet. that being said, there is a lot of aggregate debt in the system that will put long-term headwind on to inflation. they will reduce their balance sheet and hike, but at a moderate pace relative to the underlying economy. important part -- chart. i am looking at the ferro bloomberg terminal to make us wiser, and i want to go to all three of you. i usually don't do that, but it is so important into the fourth quarter. this is the inflation-adjusted fed fund yield. rightischer in the lower corner, looks at an altar economy date of fed that will weigh down on the euro mark. if chairman shows up tomorrow, where are we in the continuum from altra economy date of -- accommodative to normal? wei: we --
>> we will be normalizing and there is a temptation to continue to tighten, even though inflation is not cap present. -- yet present. i actually agree with my two co-panelists. tom: we have to stop the show, they all agree. we don't do that at bloomberg. let me go to you, mark. you say this is a fed that will lead the market forward. rates,re we within the even on the edge of normal. can i daresay it is 2019? i think we are headed from percent, but this is really striking and brings up an interesting point. if you look at developed markets in the europe, japan, you have negative real yields out to 10
years in the case of u.k., europe and japan. this is in sharp contrast to what is happening in emerging markets where inflation is falling in some countries. their central banks are lowering rates. you have central-bank convergence between some in emerging markets and most of the developed world. to be more you want cautious on developed market interest rate exposure and if you are going to take interest-rate exposure today, have it more in floating-rate form as well as select exposure. the i want to bring up screen right now to give you an example of where mr. kissel talking about europe different. here to themera in upper right corner, if that is possible. you have negative yields in switzerland, two year, three-year, four-year, seven-year, nine year, 10 year.
jim, that is how artificial the market is and doesn't suggest -- a more-- does it suggest normal fed? we are entering a new phase here post the financial crisis. we had a cycle where everything correlated to one and the central bank and fiscal response came at the same time. to a point where it economies are in different places and there are different levels of cyclicality in different reasons -- regions. you have sections of the world acting more regional and you will see volatility below. that said, i think he will see dispersion being high. whether different industries or regions around the world, as they balance the cycle. i do think in a longer period of time where you will have low rates and normal still means low. tom: we heard this week, the
idea of central banks in different locations in the cycle is key. , i look at the real yield, the nominal yield, where does goldman sachs think that dynamic is going? yield nominaleal yield dynamic going to work out over the next 12 months? all in 20 seconds, can you do it? press: we think they can against each other. both nominal yields will continue to rise, but we will continue to see some inflation coming through. we are believers that there were temporary inflation fact is pushing inflation down that will be coming back into the market early next year. while we believe there is going to be a lower terminal rate towards the end of this cycle, there is upward room. we are short u.s. while or positive in europe. talk about that. i know everyone wants to jump
themaple bond market -- maple leafs bond market on track to be the busiest since the financial crisis. in the middle east and saudi arabia, they raised 12.5 billion from a second dollar bonds shale as the kingdom bolsters its finances -- and the u.s. yield for a note sell hit the highest level since i over, 2008. -- october, 2008. mark, let me begin with you on the appetite for paper. only about theot strategy and economics, but the demand for paper. is it a frenzy yet? if yields are going to go up, and mr. kissel is going to tell us, what is the appetite for
paper right now? the demand for high-quality income assets is huge in the world, and simply put, it is overwhelmed by the supply. even though you have had a trillion dollars of investment grade corporate bond issuance here today, it has been met with significant demand and credit spreads have tightened throughout this year, what you will see going forward is more range bound to spreads. i don't think you will see tighter spreads going forward but most investors have on dennis -- underestimated how strong these technicals are. the demand for income in the world. central banks at the margin will gradually normalize and that will cause technicals to change a margin, but right now these technicals are very strong. ago, i heard sir john templeton say quietly in a meeting, there will be shortage of paper. that is where we are.
explain to an audience who hasn't read, explain why there is a shortage of paper. where is the animal spirit from i've got to lows -- load the boat on fixed it in paper? honestly, the equity market, as well. we are in a different environment. if 10 years you want -- if we went back 10 years ago, and you wanted to be conservative, you can cash and still receive 5% to 10%. around the world, if you are going to own fixed income assets, you will own something that is below your long-term retirement goal. so we do see a demand for high-quality assets, but that is also because you have an improving economic environment that has been buoyed by fiscal and monetary stimulus around the world. asset prices have risen, but the risk profile still looks pretty good relative to the underlying environment. tom: rachel -- and all of you
are sort of from the same idea that i don't want to lose money. i want to make a coupon and find total return. high-yield is making a run. are you more high-yieldy, are you on moderately speaking terms with your corporate desk at goldman sachs, or are you high-yield all the time? rachel: we are cautious on high-yield right now, although we don't see the end of the cycle anytime soon. we think valuations are pretty tight given there are increasing pockets of risk in the market and also the view that as financial conditions tightening in 2018, you'll see a steepening of the quality curve. tom: let's do this. this is important. ferro can't do this, i can. put your hands up like this to describe it. full faith and credit down here, this is their yield. you are watching high-yield coming in, tight. but then they both move. what happens to high-yield if janet yellen's inflation becomes less and transitory? do they go up together, how does that dynamic work? rachel: historically high-yield
has had an inverse relationship with treasuries. the economy has already been strong, and spreads are tight, so there is not a lot of room for spreads to go. and furthermore, we think that rising rates is going to tighten financial conditions, so we think spreads are likely to leak wider. not taking away the total return of the asset class, but slimming it. tom: mark, i know everybody at pimco eats kale and you haven't been to mcdonald's in three years, help me. we saw the mcdonald's auction deal. when a aaa blue-chip corporate like mcdonald's comes down, how does that deal get done? how do you get the paper you want? mark: well, tom -- and i haven't eaten fast food in 10 years, so probably not be biggest mcdonald's fan out there. obviously, investors are out there competing for supply. what is happening right now is the issuer has the advantage
because the financial conditions are so easy. many of these corporate bond deals are being met with incredibly strong demand, two or three or four times oversubscribed. so what we are doing is being a lot more select if. we talked about high-yield -- selective. we talked about high-yield earlier. we have reduce risk in high-yield. we are being more selective. we are owning more senior parts of the capital structure. we are not buying as many new issues as we were six months ago. we are owning more investment grade, less high-yield. we still like non-agencies as well. we like the u.s. housing market. also emerging markets on a relative basis to us look quite attractive. tom: we still have the final spread. let's continue with this discussion. we will call on rachel golder, jim keenan, and marc kiesel. still ahead, the final spread. it features in the united kingdom, they are arguing. jobs report in the united states. that will be a big deal as we moved to that december fed meeting. stay with us. this is bloomberg, real yield. ♪
♪ tom: i am tom keene in for jonathan ferro. this is "bloomberg real yield." time for the final spread. coming up over the next week, chair yellen will be speaking, a very important speech this week, in barcelona, the regional government else -- holds a referendum. we had a great report on that this week. prime minister may headlines conservative confidence. in the united states, we stagger forward to the friday jobs report. i want to go deeper, or as deep as i can with my brain. jim keenan of blackrock, rachel golder of goldman sachs, and mark kiesel at pimco. i want you to give us some wisdom here. article on theat
frenzy in your world of loans. describe how institutions by -- buy loans. rachel: loans are seen as a higher-quality high-yield opportunity set, within fixed income and a safer way of getting yield. there has been a massive issuance in the last few years, but most of it has been refinancing oriented, a lot of it absorbed by clo's, which are doing very well. rachel: collateralized loan obligation, it -- tom: jonathan ferro would not have done that, what is clo? rachel: collateralized loan obligations. the bank loans have a floating rate. tom: we have jim keenan. explain floating-rate versus fixed-rate, and why you need to flow now as you go into 2018? jim: it is around the duration
risk. fixed income has a variability of rate risk associated with it. bank runs give you credit risk -- senior secured credit risk that are tied to the front end relative to what you would get in fixed income. i do think it is important -- the bank loans, the secured market is giving you a good risk-adjusted return profile. what we talked about before is the volatility has been low. but dispersion has been hyde. -- high. whether you are looking at loans are high-yield or emerging markets, the underlying economy at low growth, there is still huge divergence between winners and losers. i think that is -- an important part whether you are looking at high yields or loans in having a balanced credit portfolio. tom: what is important here is the exogenous shock. is chairman war she, chairman taylor, chairman hubbard, can they be an exogenous shock to
the certitude of the floating-rate market? mark: i think they can. i think under bernanke and yellen we have had a robust environment. for financial assets. you have seen not only bonds do well, but equities do well. the challenges because the global economy is doing decently and because it is likely you will see inflation in developed markets gradually pick up, the ability of central banks to provide that tailwind for financial markets, i don't think it is going to be as robust as it has in the past. and by the way, that is independent of the new chair. but the new chair is going to create a potential volatility for markets. so it is something i think that is going to be -- a headwind for asset rices. tom: jim, i want to go to you with the last question. the non-sophisticates out there say yield higher, price lower. is anyone looking for an almost bear market in bonds? is there anybody out there talking about price down where
it is painful? jim: i'm sure there are some people looking out there. look, we are all getting used to the sense that there is a lot of debt in the system. it is just that the corporate level, the central bank is starting to remove that from the system. couple that with technology, demographics, i think there is a longer term trend of downward inflation. tom: this has been to sophisticated for surveillance. jonathan ferro looking to do this each and every week. my thanks to jim keenan, rachel golder, and mark kiesel. york, that does it for us. we will see you friday at 12:00 new york time. this is bloomberg real yield.
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♪ emily: when he took over as ceo of microsoft in 2014, satya nadella had big shoes to fill. bill gates was staying on as a special advisor. microsoft stock had languished for more than a decade. under his leadership, however, care -- shares shot up nearly 100% as he pushed into the cloud and made bold acquisitions, buying linkedin for over $26 billion. what is lesser-known, how he
made it from india to microsoft, joining the company in 1992 and rose through the ranks over the next three decades. in his first book "hit refresh," he sheds light on his career in microsoft and how artificial intelligence will shape the future. joining me on "bloomberg 1.0," microsoft ceo satya nadella. the story of how you got from india to microsoft is not your typical immigrant story. you describe yourself as a not so ambitious student. you failed an entrance to exam. he said he wanted to play cricket and work at a bank. yet here you are, the ceo of one of the biggest technology companies in the world. satya: i was not planning on looking back at my life. i was thinking of what is the transformation i am going through while going through it. with some encouragement, i went back and tried to trace one of
these hit refresh moments from my past. i think the thing i now recognize more so than when i was growing up is the space i got. i think the ability to think for yourself, the ability to follow your own passion was just trying to fit a particular mold. in the long run, has been more beneficial than any academic excellence in the short run could have. that, i think, is something i now think is perhaps as important as we think about all of what we say is needed in education. emily: the most powerful moment for me in the book are the family moments. it is a love story for your wife, your sons, he was born -- cerebralcerise palsy. how has this changed you as a person and a leader? he was born when i was
29, and if you had asked me just the like he was born, a few hours before, what was going through my head, i would have been more -- when is my wife going to get back to work as an architect or will the nurse be ready -- nursery be ready? and that night, everything changed. his he was born, because of brain damage, which led to cerebral palsy, but for the first couple of years, i struggled with it. everything i thought was my apart.n some sense, fell it was all about me and why did this happen to me, why did this happen to us? it was only watching my wife and what she did. the very next day, after a c-section, she stepped up and started caring for zane. all those years without actually schooling me, she schooled me.
nothing happened to me, something happened to saying. i needed to step up as father. me, is perhaps the most tough lesson the life teaches you. to be able to see life through others'eyes. me, is perhaps were a bit more of this need for empathy comes from. it definitely changed who i was as a person, whether at home or at work. bill gatesing with and steve ballmer over two and a half decades, what are the things you want to emulate and what are the things you want to do differently? bill and steve, one of the things that is pretty stunning to me, is the intellectual honesty. what i mean by that is their ability to see things, good and bad, but most importantly things that need to be improved -- with
such clarity. i have always felt that at microsoft, there would be lots of people who would run around wanting to be like bill and note, except that we would have that same level of intellectual honesty. is just such a high standard and more importantly, -- inspiringing standard they set for all of us. emily: when you came in, you got the job and said, there is a lot to fix at microsoft company, it is sick. the company has lost its soul. had you come in and say everything needs to be fixed, without offending them? satya: there is a courage to be able to both look at what needs to be fixed, and also recognize what is good. it is something i quite frankly learned from bill. bill in his forward probably captures the logic of "hit
refresh" the best. it is about changing what needs to be changed, that is the trick. they were clear, in fact steve's last piece of advice to me was bureau in person. i am a consummate insider. i grew up in the company that paul and bill founded and steve and bill created. me, i was part of the same journey, i am proud of that journey, yet i have an outsider's perspective as best as one can have growing up there. to be a bull to say these are things we need to change. emily: when you and bill gates disagree, what happens? satya: bill is clear, i am the ceo, he can give me the most critical feedback, but it is up to me to make sure i am leading the company. so there is no confusion on if billt i value -- this agrees, it is probably something i should look at again. emily: we are watching you take
on this huge cultural shift, and we are seeing other companies, like uber for example, struggle with making a huge cultural shift. what is your advice to someone at uber? always hard to give general advice, the context of everyone is so different. it is for companies who have been around for a while, that have had tremendous success, that is when culture becomes most important. the culture that got you the first success, may not get you to the next. being mindful of that system's problem is the job of the ceo. ceo be about how can the the first one to admit what needs to be refreshed. it is super important, and that is what i am recognizing. that is how microsoft has been able to catch a lot of big waves. they wouldn't be competing with
emily: you talk about in the book microsoft trying to relearn and be a good partner. one of your partnerships with salesforce has since soured, what is the danger of partnering with competitors? satya: i take anything we do, whether with salesforce or oracle, google or apple, or anyone of them, and say first, let's not think of everything as zero-sum. think of the places where we can actually work together to help customers and compete where we have overlaps. -- wenever this binary are all the time competing or
all the time cooperating -- for anyone of the competitors we work with, we look to try and find how we can create these non-zero-sum cooperations. emily: buying link in is one of your biggest bets yet, which you bought for 26 billion dollars. what have been the early successes and challenges? satya: the thing that was important to us and jeff was to make sure. m&a starts with whether the core asset -- is it thriving? oldedin is growing, growing in its usage, in its stop line, in terms -- in terms of its bottom line. six or sevento now months after close, we are at selector it -- accelerating growth is the thing i look at to as the marker of success. emily: what are the early challenges of integrating a large company into a larger company? a very different
approach to integration this time around because the goal was to have very tight alignment around mission and strategy and vision for what we want to do, but to have a very loosely coupled integration. i think that is one of the key "patterns" we want to follow. linkedin, he leads the integration with microsoft, which is something we decided day one and i decided we were going to do differently, and it has worked out very well. emily: the microsoft cloud is your other baby and has been for many years. behind amazon aws in terms of revenue, where you see it stacking up and not? satya: microsoft's play is not just about trying to mimic anyone competitor on one part of the stack. really taken off lately, even in the cloud infrastructure, is hybrid. multipleways claimed
years at the edge of the cloud is probably as exciting as the cloud is. and whether it is amazon or google who are strong in some layers, i would claim we are probably the only enterprise company that has strength across all the later -- layers that are key to customers. emily: microsoft has buried -- been very out front in opposing president trump's policies, whether -- or daca. how do you decide when to push back? what are the timeless values that have to translate into these principle stands that we take? when it comes to immigration, making sure we do everything it takes to protect our employees whole are contributing to microsoft and american society, in the case of dreamers, take a principled stand. that is how we pick these issues, but i am not an elected
official, i don't have a mandate . we are subject to laws, but we will fight for what we believe is the right of our people. emily: we have seen the nfl getting pushback from fighting against president trump, star back has gotten pushback from shareholders. have you gotten pushback? satya: whether it is at the border management level, perhaps the biggest recognition -- if i have learned one thing in my three and a half years as a ceo, multi-constituent nature of the job. it is not as simple as thinking of just the shareholders, just the customers, just the employees, just the government, it is all of these forces simultaneously all the time. for a large, multinational company like ours, really balancing all of this is what is required. emily: you met president trump twice now, what is your impression?
satya: both times, the conversations were all centered around -- my conversations were around immigration and why i think immigration and driveation reform can american competitiveness, making a case for it as well as the need for american infrastructure. particularly, digital infrastructure and of those conversations were good and he was receptive to those ideas and now we need to keep working and make sure there is axing on it. emily: we are seeing drive to integrate the tech industry from google, to the u.s., to europe, are you worried about the threat of increased regulation? satya: the most important thing for tech companies is not to worry about any impending regulation. we are a multinational, all it learned --it is not long-term stable. not long-term stable for capitalism. you have to be able to say, in any country, whether the u.k.,
germany, china or the united states, how do small businesses become more productive? how do large companies in those countries become more competitive? ultimately how we have to measure our success and that is what is going to cause governments to say are these contributing or not? emily: should the tech industry being doing more self policing? of change isce such and more rapid that we are absolutely going to look at the unintended consequences of tech knowledge he and make sure that we do not trade away some of these timeless values, as there are advances in technology. long before even regulation, it is important for tech companies to "self police" or create the tools that create transparency. make sure people's privacy is protected. emily: would you ever make a
emily: there has been a spate of sexual harassment allegations in tex. many revealed publicly, many more happening i'm sure than we know about. what is the responsibility of text here? satya: let's start with recognizing how important it is for our business to have the diverse workforce that is then able to do their best work, but it means you have an inclusive culture so you can create the products and services that can creep -- serve the world. i talk about our mission is empowering every person and organization, and it starts with representing every person and organization inside. if you recognize that importance, you will go to work like we are in saying, what is the representation? women'sase,
representation, which is low, we have been pushing hard and in the last couple of years, we have improved a couple points to 27.4 percent. nothing to write home about, we have a long way to go. we improved by 4% from a much lower base. all of this conversation in the tech industry is, i believe, the best thing that can happen for this industry is we are now going to tackle from tom, instead of having this be something that is not talked about, what about inclusion? it is not just the numbers. the numbers don't just happen on their own. it is only when people feel they can bring their a game. we have changed even the compensation for me and my senior leadership team around diversity and inclusion -- >> how so? bonusesaking sure our are tied to actual improvements. , but thethe rhetoric numerical progress, even.
to be able to put more weight behind this in all dimension. to be serious about it on all dimensions. emily: you made a much criticized remark in 2014 about women seeking pay raises. he said it is not really about asking for a raise, but having faith the system will give you the right raise. you apologized, spend four pages in your book talking about why that is wrong. how has that informed your views about your own implicit biases and others having the same awakening? to take a question at a woman's conference and answer it on one's own experiences, especially in the seat i sit in, is nonsense. what was behind the question is, what are you as the ceo of microsoft going to do to make the system be more fair? so that i get the opportunity to do my best work, and that to me is the real awakening, and that
is when i went back and said, how could i not get that? the deeper sense behind the question? for me, i have used it as a learning opportunity and for our company, i think we are better off because of my public messing up of that, because we take it seriously. i have had a chance to learn a lot from it. how far from it is microsoft being able to make its own hardware? emily: it -- satya: satya:it was alan kay who said if you care about your software, you will make your own hardware. emily: would you ever make a phone again? satya: one thing we have said multiple times is that at this point, what is needed is for us not to be obsessed about categories that are well served, not on current rules. what is considered a phone today will be a very different in the future. if you take hollow lens, is it a
mobile device? yes, it is untethered, battery powered, you wear it on your eyes. what is the future of those kinds of devices? me, microsoft will always be in this end to end computing experience, but our goal is to create -- invent categories and reinvent categories. emily: you talk about three strategic bets for the future in your book. reality, ai, quantum computing. on ai, are you at all concerned that google or facebook or amazon or apple could outpace microsoft on ai and become dominant in ai -- this ai future we keep hearing about? microsoft's, approach will be all around, how do we take ai? today is a little perverse in how everyone says look how cool i am because of the ai capability.
that is not how microsoft approaches any problem. it is not about any parlor trick of hours or a promise we celebrate. the most important thing to us is, are we market sizing so every customer of ours can build their own ai. if you want this industrial revolution, we now -- need to etise it soto demark that anyone can use ai to their endeavor. satya: is elon -- emily: is elon musk right to be warning about the dangers of ai, the military applications or otherwise? satya: with any new technology, there is a lot of good that comes with it and we should grab hold of it and be clear eyed about any unintended competition -- answer quenches. we have to use ai to empower humans. but that said, wherever ai runs amok or we lose control, that
could be dangerous. so i think the first responsibility we have in thinking that is going to happen, let us encode or enshrine a set of design principles, so i think we shouldn't abdicate our responsibility, like good user experience. there is such a thing as good ai, i believe what is the need of the hour is for us the creators to enshrine those principles. emily: so robots could take over the world, but hopefully not. product theone competition got to first that you wish microsoft could have gotten to first? satya: if i look back at history, there are many products. gotten to theeven relational database before oracle. if you think about one of the most amazing pieces of technology, before ibm. much't worry above -- as about the technology someone
else got two. the question is, are we able to go back to that sense of purpose that we have of what we can do with the technology, however novel and knew it is, it has to fit with our identity. to aif someone else gets quantum computer first, what are they going to do with it versus what we will do with it is probably very different. emily: you now build many of many differentor operating systems. what is the future importance of windows to the microsoft future in general. satya: there are billions of users of windows, 3 million pcs got sold last year and it continues to be a significant part of what we do. but it is not the only part. that is the change for us, which is, we now have a much more diverse, robust business. we have xbox in gaming -- which spans pc gaming and the console gaming, more than 55 million xbox live subscribers.
windows system, the fastest-growing pieces of windows are all about microsoft 365. officeously have our -- services, dynamics 365, hybrid infrastructure. microsoft in that sense is a much more diversified portfolio, with linkages between them. that is how we are going to keep going forward. , thank youa nadella so much for joining us today on "bloomberg 1.0." so great to have you. satya: thank you. ♪
megan: above all else ginni rometty is an innovator. estimated ave market of $2 trillion to make better decisions. megan: she is quitting jobs and standing on principle in a time of political controversy. -- she is creating jobs and standing on principle in a time of political controversy. d by criticism. people shoot. megan: coming up, a conversation with ginni rometty. ♪