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tv   Bloomberg Markets Asia  Bloomberg  November 27, 2017 8:00pm-11:00pm EST

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-- says he wants stability at the bank, not a top-down shakeup. 30%bank investing in over, the current -- 30% below the current valuation. we have a special report. this is bloomberg markets. >> just about half in our way
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from the start of the session. let's have a look at what is going on. done.ally is not average. the today it can go higher. we have the shanghai stock exchange positive. a clear outperformance. this is what we have in the moment. -- let's take a look at the here and now. find out what is going on in
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singapore. -- subdued.ubdue mostly lower when it comes to sessions there. the deck one races to 10,000. not look like it is helping in taiwan so far. take a look at the big picture. very much as -- crude focuses on a two-year high. taking a closer look, the end holding gains that we saw overnight. this is being thrown into the next.
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-- in tokyo, we have pharma falling by the most since 2011. -- is president of the company to hold a press conference at 10:30 a.m. local time in what you take a look for the sox, your seating trading volume over a hundred percent over the 20 day average. it is a good day for other companies to show you.
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are -- >> as we head towards the china -- , >> thanks. levelhas raised its alert after receiving notification that north korea may be planning a missile test. forsuggest preparations possible launch, yet satellite images don't show anything normal -- abnormal. authorities in bali have repeated warnings that a volcano is about to explode and a hundred thousand people are told to evacuate. threatia race its
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warning to the highest level. travel and tourism make up 10% of the gdp. ireland is facing a growing political crisis. in males from the justice fitzgeraldsuggest may have known more about plans to discredit the source then appeared earlier. she said she has done nothing wrong. praised the saudi prince who was arrested in the anticorruption -- he said he is only aware of what he has read in the press and cannot speculate. his commitment to philanthropy
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is inspiring all global news powered by more than 2700 journalists and analysts in more than 120 countries. >> jay powell is at the state for his confirmation hearing. -- his curse to me is this very important confirmation hearing by laying out what he sees as monetary policy and what he thinks about bank regulation and planting his feet firmly on the ground. on monetary policy, he expects interest rates to rise further. sheet anded a balance
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no reason for him to deviate from that. look out below if there is a recession. financials, very important. he said it is stronger and more resilient than a decade ago. -- makes thegher capital fed better able to deal with the risks and says he will look to ease regulatory burdens. he wants to preserve performs. we don't know how how will will asked.questions will be
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earlier, he said he is very positive about how the fed is staffed and where they are headed. sayingsident of new york they are very knighted on an appropriate policy path. today, one more person wrote an essay saying he thinks another rate hike soon is appropriate. i think he is in line for a december rate hike. again, we will wait to see what he has to say tomorrow. next, the bank of japan .overnor speaking
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>> i thought it was a lovely speech. he went over things that went wrong in classically i think one of the things people point to is are we short in u.s. dollars and lending and local currencies and currencies i use. said asian nations have in theylot of steps have boosted. he says nation -- asia is more resistant -- resilient and will be at the core of global growth. capitalization of is three point 7
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billion u.s. dollars, more than 100 times bigger than before the crisis. we have certainly made progress. economies have become more resilient. says asianrnor also nations have come a long way in developing local markets. members isfor looking at another issue, particularly for the boj. he says earlier the boj should aim to reach that target by 2018 because if there is a sales tax increase, the boj needs to be in place to help the economy
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withstand it. japan and the rest of the world and potentially new fed chair faces new problems. much.nk you very storiesfollow all the terminal.e bloomberg you can get a market rundown in and you can find out what it is affecting your money right now. strategy.arket it is the hong kong rally really over with? more on that later in the program. this is bloomberg.
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>> back with bloomberg markets. a look at the latest headlines. to sharesas offered of uber for less than 30% of its value. offer would be significant and a number of shareholders having great to -- have agreed to sell. lamon is saying a report -- the comic or says it has not been charged with any offense and is still operating fully.
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-- 900 positions may go to the retail banking as a result. about $475 of million. that is on top of the two and a half pounds. -- it further destabilizes -- the president saying the banks priority is keeping business up, not retreating from the competition. powell's prepared
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remarks, is about to shake things up with the fed. chris is it chief market strategist in melbourne. city is she goes i suppose is the message? case.hink that is the transcripts from the confirmation hearing, we have not learned a lot. it is not giving us any new insights. most of the conversations he's had has involved regulations so the question which comes at 3:00 markets. time will be
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programming jay powell on the economy. they did it will be a few more inside then we know. >> that is one way of looking at it, but it is a row speculation. , he might have a battle on his hands because dodd-frank is needed to repeat in 2008. dodd-frank can be improved, but he's not favor of repealing it. what he says about regulation is i suppose what many people will be listening for. >> i suspect so. i agree. part of the reason he has been -- een given the
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it will be steady as she goes with mental changes that will happen. speechellen in a recent proud about the banking system and we have a much stronger banking system in the u.s. so what needs to happen now is the regulation and i think he is the man to do that. >> there is a growing body of thought that central banks on top of that are really not looking at inflation properly and people are getting more complacent about inflation in the future.
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the bond market is about 186 at the moment. that said, i think if you look at the composition of the fed next year when we get the changes and we get some of the replacements as it stands at the moment, the only person who has got as you in line with the is comingveryone else in and it is much more hawkish. if we do see inflation picking they will have to raise even three or four times next -- oned market pricing of the risks for next year is that we see volatility picking up.
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that willing to cause be a tick up in real yields across the board and tightening of financial conditions and that comes behind the curve. we're just going to have to see if inflation is the missing piece. in,e do see a kicking ,pecifically europe and japan it really should move up and that will put a lot of pressure on things like emerging markets as well. >> this has in -- invitations on bonds and the equity market. the background, very low volatility at least now. >> that is right.
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there are so much to suppress volatility from these structures from hedge funds -- hedge funds and various players. it continues to feed the data that keeps coming through, particularly what we have seen in europe and japan as well. kicking insigns of a and that will continue to keep volatility low. earnings should be ok for next year. you're going to get about seven to 8% coming through. it really pretend -- depends on the multiple of market. veryal banks still gradual. that said, if it doesn't, i
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think that implied volatility structure is going to be key if we do -- i know that is a hedge type view, but the reality is there are some much money involved that if it does come unwound, it could be a punchier there. >> thank you for that. joining us from melbourne. you can catch up on tv and watch us live. if you're a bloomberg user -- check it out. it is at tv .
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this is winter -- tens of thousands of migrants are being evicted. many of the tenants has left beijing. they told me beijing does not to stay, so we are going back home. here it as a heavy-handed campaign to drive out beijing's migrant population as part of a push to beautify the city. these people are construction workers, delivers divers and a
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little forced that keeps things running and services cheap. >> they had about a week to pack their bags and move so they have been moving -- living in some situations for decade and the conditions are great, but they been given very few options. to find homes have seen their rent more than double. >> to ask us to move out in such a short notice will increase living costs. higher several times them up for. >> many have no option but to take their few belongings and return. >> taking a look at the premarket auction and this is
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how it managed to close out. that.ints below stocks are generally subdued. more on this right after the break. retail.
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start of the trading day here in hong kong. there is a lot going on, even though markets are -- we have geopolitical tensions with pyongyang seemingly rattling the state. they could be preparing for another missile test. opec meetings get underway this week. oil stable as we look at this deal between opec and russia and whether it can damage test of time. and itsng the senate tax overhaul plan. on top of that, we have jay powell's confirmation hearing coming in a bit.
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pricedp, jobs data, numbers as well all likely to be occupying the attention of market participants. let us get to the start of this trading day right here from hong kong and find out what is going on. >> it is continuing in china and hong kong. let us show you the action in shanghai as the small-cap g aged for chinese equities. we can see how large caps on extending the drop after they fell to a three-month low on monday. losing it is that 300, 0.4%. coming some gains through for the small-cap gauge. flipping the board to show you the action and hong kong after a two-day drop. these down by 1% so far this morning. through in hong
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kong. if you look at history, the rally stocks may not be over. if you look at the bloomberg, the recent rally we have seen and hong kong, this is the third mainland liquidity-driven rally hong kong has seen durin. during october, it was at a 42% premium above its 200-day moving average. that is the line in red. it did hit an all-time high in that month in 2007. as of friday, that cap stood at 14%. there may be further to go. mind,'s china security regulator is suspending approval of some mutual funds that invest equities.ng that may dampen the appetite when it comes to the flows and how it may have to indoor more ups and downs. taking a look at the market picture, look at what is going on with the hong kong dollar. 700 $80 after the
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biggest two-day gain in september. it was accompanied by a jump in local rate given liquidity. checking on early movers in hong kong, we have chinese characters, air china. expanding losses for a second day in china and hon hong kong d shanghai. flipping the board to show you tcl multimedia. on a rights issue to raise around $2 million. powell'sl look at jay confirmation meeting coming up. trump's nominee to head the fed says he expects the central bank to continue raising its benchmark interest rate and trimming its balance sheet under his leadership. in the text of remarks he will deliver later to the senate banking committee, powell pledged to protect financial stability through the fed's role
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as a banking regulator while reforms.regula he says he plans to take a more prominent role in the tax reform debate. he is hoping for a vote on legislation this week. several gop lawmakers have not committed to supporting the bill. if it passes the senate, party leaders will meet house republicans to reconcile differences. london is becoming less affordable than ever with homes at 14.5 times earnings. the average cost of the first home in the capital is still up 66% since 2012, as supply fails to meet demand from suppliers and overseas investors. oxford and cambridge also have price-to-earnings ratios in double digits. two reactors fired up early in the new year. to keep themon
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back online. reactors three and four will be revealed at the start of next month. japan's 42 workable reactors are currently operating. global news 24 hours a day. powered by more than 2,700 journalists and analysts in more than 120 countries. i'm paul allen, this is bloomberg. getting further and further away from the level. what we're witnessing is sort of a big cap stocks in the main shares. 32 index is 14% above its day average. it is suggested that i can go higher. summaries putting a lot of money where their mouth is with regard to this rally going on. >> correct. --t to be sure, i have >> you indicated twice?
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last week on thursday. >> yes. the problem is the liquidity of trade. mainland chinese investors have traded 1.7 trillion hong kong dollars through the command this year. 250 billion hong kong dollars into the market. there were two episodes in which the hong kong market received the mainland shares. the first was in the spring of 2007. the second was the spring of 2015. both times, the hong kong index at 40% above the 200-day moving average. the other time was trading at 17% above the 200-day moving average. chinese investors love to look at the technical charts. based on history, they would say the house index has not kept and
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that is my argument. >> as you mentioned, it is all about liquidity. they've all different trading here in hong kong. shuli: correct. your rights. according -- you are right. according to one study, it only contributed to 14.8% of trading this year, down three percentage points from last year. but they are saying is this year, we are seeing a lot of wealthy retail investors trading on their own accounts rather than mutual funds. this money will still be coming in. of the mutualor fund crackdown will be right muted -- quite muted. >> what are other market participants seeing? shuli: it is volatility. think about it. retail investors will go a for chinese new year, they will, go away for western new york
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celebrations which means that the liquidity would not be coming in. we will see more volatility at the month's ends, which is right now when they have to close. we will see more volatility as we continue. >> thank you so much. let's move to another rally. this one is just looking unstoppable. $9,712 to buy yourself a bitcoin. asian technology could. reach the benefits arguably, this -- technology could reach the benefits. i am not making any sense myself when i am saying this. let us bring our markets reporter. >> the way cryptocurrency mining works is that you have all these computers that are solving mathematical puzzles in order to earn tokens. as you mentioned, we are watching bitcoin approaching that $10,000 milestone. >> you have to have warehouses
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order to getrs in this, which sucks up so much money. justina: exactly. it is becoming a lot more competitive at this point. bitcoin mining is designed so it becomes more difficult as the dissipation increases. it is a comparative -- participation increases. >> tummy about the agent companies who are in the mining supply chain. justina: it all begins with a study conducted -- semiconductor. you're still talking about taiwan, which is apple's chip supplier. and then you have chip designers. of course, there are also the graphics card makers. normally, they are making ,raphics cards for gamers but now the gamers can turn into an amateur minor. er. >> tell me something here.
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are these counties he mentions actually mining bitcoin themselves? justina: most of them are not. i think a list of companies are probably still watching this closely, but you have a few asian companies that are trying to be the pioneers here. for instance, you have japan's gmo internet, and online services company. they said they will start their crypto mining services next year. and then you have a shoe lay in have a company in china. that thousand saying, but their stock has searched or hundred 60% since they announced this project. >> what about the price of bitcoin? let us finish on that. it is down a bit. the jury is out. nobody knows. someone think it is worse. he was saying this could be worth $1 million at one point. justina: there is no way to
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discuss the fundamental value. it is not becoming a payment currency. what is probably going on is even though we have had some good news and some bad news, all muses good news for bitcoin because it turns people's. attention to the staggering rally now you's -- people attention -- people's attention to the staggering rally. >> bitcoin futures are perhaps coming on as well. on top of that, you get etf's based on that. certainly more money to go in. thank you so much, indeed. coming up, more on asian equities with china's biggest private world manager. beijing's new business world will change companies for the better. this is bloomberg. ♪ ♪
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>> you are back with bloomberg markets.
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we will check in with the latest business flash headlines. communications says it is surprised by the untimely actions of the development bank, reportedly filed a suit in india. the company defaulted on dollar bonds earlier in the highest debt failer since in india's new bankruptcy codes past. world's biggest maker of generic medicine. it is splitting its business across three regions, the united states, europe. they will try to pay back nearly $30 million in debt. u.s. imports of chinese eel help -- steel.
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the metal arrives on american shores in october. they will be examining whether these imports during u.s. national security. these started last year when the obama ministration pass an audit. china'sdings for biggest company. this was listed on the new york stock exchange. it manages around $18 billion in services 150,000 high network individuals. group's president is kenny lam. great to see you. tell us about what worries you. you have all these high netwo assetdividuals and management projects. how much of a threat is that your business, and how much of a threat is it to the market in general? kenny: you will be surprised. i sleep better now after the regulation papers that came
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out. what happened in the last two years was a tremendous growth in the market. you have a lot of players coming in with questionable practices, products that may or may not default. what the super regulation does is to make sure the risk profile of the clients are properly vetted, make sure that the product that comes out is done well. all of that is good for the market. there will be short-term downturn. what it does is it helps the market grow in a healthy way. rishaad: the point being also here that we have a lot of people who invested in these products. they may well lose their money. kenny: we have seen that. withve seen that starting them stock market being volatile. clients started investing from fellow players and their products. what you see is their starting defaultthe potential to
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them products and they are making sure it is done well so good product will be guaranteed. that is what the government came up with to say that there will be no guarantee. there will be short-term impact on some declines and mark term. pain forshort-term gai long-term gain. >> exactly. rishaad: it has only been halfhearted before. now they're saying let us stick around and create new ones. kenny: i think what is different this time as it is cross regulated. it is not just cbrc. records are coming out with super regulation, saying there needs to be a unified change the wealth management market and i think that is a good and. -- thing. rishaad: there also noises emanating that they could have their own fund managers investing in hong kong. 120 asset managers here. what is the danger of that is
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you are sucking the liquidity out of the system? kenny: overall, if you will get the long-term economy, you've seen a capital outflow continuing. what it means is the globalization of currencies and the chinese economy. there is a short-term control that leads to some kind of balance. overall, i think a long-term opening up of the market. rishaad: lovie smith the other dangers and other headwinds we might -- let us move to other dangers and headwinds we might see. corporate debt. we have seen how yields have been spiking up for corporate bond in china. does this worry you? kenny: short-term, yes a bit. but long-term, no. what it means is short-term there needs to be restructuring of the economy. there is still some overcapacity in the economy. that is why we see this spike in the corporate debt. g term, i think this
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is necessary. rishaad: do you see bankruptcies? kenny: i cannot see where it is going to happen. rishaad: i'm not asking that. kenny: i feel if could be some bankruptcies. rishaad: does that mean the death of the so-called beijing put? kenny: it is difficult to say. what i can see is the government -- rishaad: the moral hazard that could be created. kenny: yeah. what i'm trying to say is governments that could determine this can make sure the economy is restructured well. i think what we see coming out is in the next five years, it is all about making sure we have a strong basis for growth and, therefore, if we have a restructuring complex, let's do that. if we have to make some coming bankrupt to make sure they're healthy, let us do that. rishaad: institution money goes into the bond market, and we equities being driven by retail primarily. don't we? do you see that changing? kenny: slowly but surely.
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the retail market would have to be supported by institutions. we are starting to see global institutions spiking up exposure to china. that is a good thing. i, think the bond market is still quite small, so there needs to be a lot more support. is, we keep onon saying the same thing. it is going to be jammed tomorrow but it will take the pain now. how long? we have a system in japan -- sorry, china involving a becoming more and more open. went we have capital control? what do we see more flexibility for the currency? making it more market orientated? all of these things. kenny: if you ask me -- if you asked me the same question a year and a half ago -- now, i think it is a lot more complicated. the government has a lot more control to do something. the super regulation two weeks ago was one example. you really see cross regulated companies.
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if they do deregulation this way, it pushes the market in a fast-paced manner rishaad: -- fast-paced manner. rishaad: how would you describe the chinese economy at the moment? >> i would say it is a slower growth but healthy growth type of economy. rishaad: i'm going to ask you why i asked you that question after this break. stay with us. he is the president of it no a group. -- noah group. this is bloomberg. ♪
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rishaad: we're back with bloomberg markets. as we continue our conversation with kenny lam, you characterized chinese goods as being healthier but slower.
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is this better in the chinese economy than it was two years ago? kenny: i'm going to saound like a fan of china. rishaad: but you are. [laughter] kenny: two years ago, regulations and the way the government approach the economy was still in the learning phase, so there is a lot of changes in how you approach it. i think what you see in recent policies that came out, for me that is whyr me, i say it is better. i cannot say that about it two years ago. rishaad: this will make me so much a china fan, as well. with all these changes in regulations, is beijing doing a right thing? is actually amending this roof? kenny: i think you can ever say they are doing the perfect and right thing. what the regulators in the government have done, it is different here in china versus others. they said they are willing to -- they are learning from
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mistakes. they are looking at advice from the private sector, which is actually unique. that is something that is refreshing for me. rishaad: let us talk to about this other phenomenon here. it is amazing that tencent countries are becoming the goal. some ideas recently have been frenzied on the market. it is not just tencent. it is everyone across the board, isn't it? kenny: there is still of potential that is untapped about tencent and alibaba. they're growing at 60% plus year and here. -- year. it is a platform that can expand into many different things. i think it makes sense. rishaad: what about tencent, itself? are you a fan? kenny: i cannot go on a day without we chat.
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it goes to show that china is a big untapped market. thatit does right now is tip of the iceberg and they can do a lot more. would you see it behind all tencent related stocks? i think it makes sense. the releases the potential of a bigger platform. rishaad: what about another aspect -- i get many complaints from non-chinese investors who want to invest in china saying nobody makes money there. it is very difficult to make money there. only the chinese make the money. what is a response to that? kenny: it is. many of the funds i work with globally is saying that china is still a big black box. the companies have three factors. the directors are constantly changing, it is highly policy driven so it is not really just isrivate sector, the third
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demands of the consumers in the market. they change what they want in a very short period of time. those three factors make it very difficult for anyone to come and understand the chinese market. invest eight shares in hong kong, but they have -- a shares in hong kong but they have been underperforming. kenny: that is why we have to -- that is why we say you have to come to mainland hong kong in china. that is what you see a lot of people coming in to china. rishaad: thank you so much for joining us. kenny lam. group president of noah holdings. china'sdescribing economy in the better positioned than it was two years ago. coming up in our next hour, we
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have bitcoin. move.e cryptocurrency can this is bloomberg. ♪
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rishaad: jay powell, fed nominee, saying he wants stability at the bank, not a top-down shakeup. bitcoin reviewed its relentless climb, despite continuous warnings of a bubble. $10,000 now within reach. the broken dreams of china's migrant millions. the report from the streets of beijing. this is bloomberg markets. ♪ rishaad: a look at that and
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other things coming up this week. opec getting together to discuss oil prices and this agreement on manage oil in to the market. look at russia right now and have a gander at what has been going on here. we have this coming through from a former central intelligence agent analyst director. croft saying putin is calling all the shots. this chart exemplifies this. the wetland is showing russian oil production as soon as they decided to cut and have an agreement with opec. nearly 11.5 million barrels a day. with that, we are seen a gradual recovery in the oil price here, as well. the 14 members of opec will be meeting these independent producers, such as russia and
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mexico, indiana. cuts.ill be discussing we have a participant in the accords collectively pumping something like 60% of the global oil production up there. that is a nettry will importer now is indonesia. things are getting underway there. >> we will look at the trades in jakarta. we are seeing it fall 0.33%. the move has turned left sour -- less sour as it came to trading in japan. we will show you how it is trading for this. morninge raised the losses and they are now gaining ground. this is trading at the 111 spot. chinese take a look at markets, we are also seeing gains in shanghai and shenzhen, and a small cap gauge that china
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is on a nearly 1%. we are seeing the large gap index marginally lower as the morning session wears on. look at what is moving. consumer staples and i.t. shares. energy and financials. we are seeing clay chow part of this rise. that stock is gaining ground after a seven-day losing streak. this is gaining on most 3% so far this morning. this one, however, remains a negative territory. we have tco multimedia falling the most since december 2015 on its issue plan. that is falling for a second day. air china is falling in both hong kong and shanghai. the stock was downgraded to neutral. china under pressure. developer with both beijing and shanghai and their concerned --
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they are concerned about jpmorgan. china's war on the property bubble. in tokyo, we're seeing tori industry plunging by the most since 2011 as the company 149 cases has found of falsified data at a unit that makes manufactured tires. 13 companies were affected. boeing is not among those affected. we do not know just yet. thei pharmaceutical is lowest. take a look at samsung shares, continuing to drop out into monday's 5% -- adding to monday's 5% tumble. extended losses giving the -- given the downside risks that morgan stanley foresees. that is not weighing on the cost sees, that is down around 4%
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this morning. rishaad: thank you for that. let us go over to sydney with the first word news. japan has raised its alert level after receiving indications that north korea may be planning a missile test. news reports say radio signals have adjusted preparations for a possible launch, yet satellite images show nothing abnormal. they say that the market file in during -- fire a missile president trump's asian trip but nothing happens. think something is about to explode with 100,000 people about to evacuate. thousands of tourists are stranded at the airport close until at least wednesday morning. indonesia raises concern about the taurus industry. tourist. industry --
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ireland is facing a crisis that could bring down the prime minister. voteaces a no-confidence over the handling of a police whistleblower. emails suggest francis gerald may have no -- fitzgerald may have known more about plans then appeared earlier. she says she did nothing wrong, but the controversy could mean a snap election. bill gates has praised the charitable work of the saudi prince, who was arrested in the kingdom's anticorruption drive. in any bill stiritz bloomberg, gates says "i am only aware of what i have read in the press and i cannot speculate. he has been an important partner in my foundation's works to ensure the kids around the world receive life-saving vaccinations. his commitment to philanthropy is inspiring." global news 24 hours a day. powered by more than 2,700 journalists and analysts in more than 120 countries. i'm paul allen. this is bloomberg. chinese stocks are
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looking for signs of a north korean missile launch. big whe thattcoin ending close to $10,000 mark. bitcoin has been grabbing all these headlines. absolutely. i think we are still in this bubble phase that could last a long time. it does seem funny that people are calling arbitrary levels to be the resistance level -- the resistance level to be the target. we have an in uncharted territory all year. there is no reason for it to be $10,000t with $3000 for and $30,000. i saw overnight the manager who was setting up a bitcoin fund talked about $40,000. $10,000 would have seems crazier earlier this year.
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it is important to know when we're in this environment where people are purely buying for the momentum and higher prices, not for any other purpose that doesn't yield anything, it is not particularly useful. it is only for the prospect of gambling purposes. there is no reason to have a limit of how hurricane bill before the bubble will collapse. rishaad: absolutely. this could turn into props other bubbles out there, as well. 300 cryptocurrencies. i will not ask you that will let us move on and talk about market sentiment today. what are we looking at? low volatility? we're looking at very subdued equity trading. mark: absolutely. markets are very quiet at the moment. overall, i think there's a little bit of a hangover from the turkey season before the weekend. a little bit of holiday market. i think that is partially because people are gearing up for potentially large moves on the horizon. there is a chance we might make serious progress on tax reform.
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there is expectations other might be a vote this week, and it is very tense whether it will pass. explanations in the market for the perceived tax reform by the end of this year are extremely low. correctly, i think the expectations are low. however, that does mean there probably is a greater chance of positive surprise than a negative surprise. if none of those get past this week, not much will come out of the markets. i think overall, the markets will trade -- there will be difficult equity trading into the year ends. it will be a wonderful year, so a lot of people will be tentative. because they have a divergence between what the fed is talking about with what they want to do next year marked the market is pricing in, that means any u.s. data point has a risk reward to skew negatively for equities. i think it will be a tougher market for equities going into your end as we look to those from tax and what the policy will be next year and what from china is doing on the deleveraging drive. thingd: there's one other
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which is about asian stocks switching from under study to leading roles. i'm curious why that has been written up given what you just said, that they are waiting on u.s. tax reform, which is something we are have been taking the lead from in this part of the world. mark: as i mentioned, another thing is china deleveraging, which is very important. there is a long health seen that the u.s. drives stock sentiment. of course, asian equity markets have grown so important that the four largest in the world are in asia. we also have the fastest-growing economy. because we have the fastest-growing retail economy and consumer sector, this health asia. this is an asia region. asia is becoming the most important driver for global economics, for global trade, and for global markets. it should be dominating this
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much more often but still, we seem to be stuck in this kind of old world were asia just takes its need from u.s. u.s. markets rally in asian markets rally the next day even if there is something that happening in asia. we are starting to notice a little bit more that china is deleveraging -- that china's deleveraging drive may be as important going into your end as the tax reform development. rishaad: thank you. mark joining us. you follow his musings and others in the day's trading on her markets -- on our markets live blog. nou can get a market rundowni one click. you can find out what is approaching your investments right now. powell aheaderome of his hearing. we will be asking if that is the right move. more liquidity into the dough
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currency market. gatecoin.d this is bloomberg. ♪
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rishaad: this is bloomberg markets. we are in hong kong with the latest business flash headlines. japan has taken another hit because of the fiber and materials in the industries admitting that it had falsified data. fours fell the most in years on that news. it affects 13 customers. client think you -- include boeing, for whom it makes carbon fiber for the 77 dreamliner. they're denying a report that he could be fired for manipulating french text, saying the
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allegations have no basis and vehicles comply with the law. the newspaper is saying that anti-fraud france's office. the carmakers says it has not been charged with any offense and it is cooperating completely with the french authorities. general expected to push charges in the fourth quarter related to tax changes and drop more than 900 positions. it will result in a charge of about $475 million. generale already said it will eliminate. skeptics, asfined well as warnings about a bubble rising. 45% over the past fe -- two weeks. the return so far has been 850% this year. what is a fair value for
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bitcoin? how long waill it fly for? gay coin is a cryptocurrency and block chain that can be coin ised here -- gate a cryptocurrency and block chain that can be exchanged here in hong kong. >> we were the first exchange in the world for -- we will service of the coin -- bitcoin and a variety of other tokens. other i feel tokens as well. we are one of the first exchange is to underwrite initial point offering. we have an expertise in that space. growingbeen focused on our presence in asia and europe over the last few years. rishaad: where is the demand coming from? for bitcoin? thomas: if you look at what has really been driving the markets over the last few months, it is the philly japan. there is definitely japan.
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there's been a tsunami of trade activity coming from japanese exchanges ever since the they said they would invoke a licensing regime. we thought really taking off, japan being one of the biggest markets for retail in the world. the japanese housewives, which are speculating on this and now moving into crypto. months innt two tokyo in witness this myself. i've noticed 85-year-old women who had bitcoin. .that has been contribute into a lot of the activities at the same time, we are also seeing a lot of institutional investors starting to dip their toes in the crypto water. they're been expressing interest in this for some time, but now they are starting to get involved. u.s. once aen the
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year coming out saying that you don't believe that it existed and the next day thomas: announcing the derivative base of the coin. thomas:exactly. at the end of the day, this is a speculative market and the financial institution cannot ignore the assets, which have grown and so much in a short value of time. rishaad: they've done exactly that. that is the point they seem to be making. thomas: true, but i think if you look at the face of bitcoin out of technology, it is still early. less than 10 years old. there are other platforms that are much younger, as well, for technology. i think it is trying to get involved in the open source at a very early level and recognize the long-term potential value of these technologies. rishaad: what is the value? there is an intrinsic value. playing doubles advocate, -- playing devil's advocate, you
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could also say that gold has no intrinsic value. 95% of goal disease for equity purposes. sure.: to a certain extent, a lot of the activity driving the momentum in bitcoin markets is purely speculative. ullare seeing a growing p of investors which are heavily -- to hedge against sovereign risks. the fact that you have the currency which is outside of the purview of any centralized institution. misunderstoodften about the coin is you can build other applications on the specific block chain. forcan have other companies side chains or enabling bitcoin to be another computing platform. rishaad: that is just what is behind bitcoin. thomas: of course i would agree
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that if you look at the fundamentals in certain valuation metric, it is a very illogical market. it is very difficult to come up with a logical way -- rishaad: absolutely. this is the thing everybody grapples with. you value was and that is impossible. nobody knows what a fair value is. thomas: exactly but i will still argue it is highly undervalued. if you look at the long-term potential of the technology in the next 10, 20, 30 years, $10,000 is cheap in my opinion. what is also important to number .visibleuite is up to eight decimal places if one is worth $1 million, you can still have one u.s. dollar worth of bitcoin, which you could transact. i think he will are willing to look at the coin in that way with that long-term view, but also to recognize some of the more underrated clip -- cryptocurrencies such as light
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coin. with light coin, what is interesting is the founder is very visible. he is present. he is engaged in the community. coin -- the are, like in the year, like when activated something that created a lot of -- that's it not create a lot of infighting in the community. this is why we have seen an emergence of different areas, which to a certain extent is fine to have a decentralized ecosystem.this is just a demonstration of free market. rishaad: that is placed on -- based on watching as well, isn't it? like wayne as bitcoin and away but with some upgrades in terms of transactions been an efficiency. rishaad: how far is bitcoin really about on block chain technology? thomas: it is not because you
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need to think about it as the bitcoin block chain. computingther platforms. if you look at a token of the syrian platform, the value of either is tied to how many people are building up on this etherian platform with all these decentralized places and ipos and token sales, whereas bitcoin and bitcoin's value in the block chain will be tied to the developments of bitcoin either is a digital currency or even as a computing platform. suit was paid for by bitcoin. to do that would be a political point more than anything else. thomas: exactly. cannot actually buy it legitimate goods and services. i have made several purchases with bitcoin. some of them i regret now, given the current price but i bought this suit from bitcoin and made
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many other purchases with bitcoin. now it is quite expensive. i'm switching to light coin. rishaad: thank you so much. do you think it will go up further? i guess it depends on how long the piece of string is. gate coin had a business for the asian pacific. you can catch more of that interview and other interviews using our interactive function, tv . you can watch us live. also, if you want to become part of the conversation, there is instant messaging during our program. this is rick bloomberg subscribers only. check it out. ♪ check it out. ♪
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rishaad: softbank may be to buy cooper shares at a much lower price than expected.
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reporter has the latest. what do you make of the offer price, and what are others making of it? uber has certainly had a really tough 2017, and i think this discount certainly reflects that. they sell the company and ceo leave after a series of scandals and lawsuits. they are still locking horns with alphabets over self driving cars and continue to clash with regulators worldwide. it is also telling that stock deal issoftbank's closely linked to expanding uber's board and a whole raft of governor reforms break even at a 30% discount,, this would be a windfall for some of the early
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investors who have been for a long time awaiting an ipo that is a few years away. the deal has yet to be completed so that my u.s. colleagues are reporting a few investors have already agreed to take the deal .it will likely begin on tuesday. at which point, a lot of major investors are likely to wait until the very last moment to the willingness to leave the deal on the table or perhaps move forward. rishaad: we'll may have around 25 seconds. softbank is successful in buying this -- if softbank is successful in buying this state, what do they plan on doing with it? >> i think the potential will be on southeast asia. how will softies asia reconcile their stake in uber? there are opportunities for consolidating markets and perhaps even picking winners in particular countries. rishaad: thank you so much for that. looking at softbank trying to
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buy a stake in uber. this is bloomberg. ♪ retail.
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under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store
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near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. ♪ i am paul allen with the first word headlines. president trump's nominee to hit the fed said he expects it to continue raising its benchmark rate. pledged toalso protect financial stability through the federal as a banking regulator while refining post price regulatory reform. president trump has indicated he intends to take a more prominent role in the tax reform debate. senate republicans are hoping on a boat this week. they have not publicly committed to supporting the deal.
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if legislation passes for senate, party leaders will meet house republicans to reconcile differences in their two bills. london is becoming less affordable than ever with now 14 of the average earnings. even with the recent slowdown, the main cost and capital is up 66% from 2012 at supply fails to me -- failed to meet demand. have also notdge earned earnings ratios. cap are electric is firing up to reactors at the plant earlier in the new year, the company one permission to bring them back online despite objections from local people. that is three and four will be your from the start of next month. north,about 90 villages only four of japan's 42 portable reactors is currently operating following the disaster in 2011.
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level news, 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries, i'm paul allen, this is bloomberg. let's look at the markets, subdued at the moment. they are fluctuating with thenese had a higher than yen. the market goes down and the other way around of course. they are making -- heading to the tokyo lunch break. >> we are seeing stocks in manila leading the regional drop. the worst-performing major benchmark is the housing. real estate is the hardest hit in hong kong, this as they report that china securities thelator is helping approval of some mutual fund and invest in hong kong equity. when you look at the other side, we have shares in seoul, tokyo and sending climbing the topics and the nikkei raising as the yen is back.
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mixed as investors assess how much further this chart guys had to go. when you look at this current dollar, that is holding steady over uncertainty over the u.s. tax debate. asian currencies are generally lower. pyongyang is preparing a fresh missile test. rateare limited and of the decision due out on thursday. the hong kong dollar is leading the most ground, his biggest two-day gain since the start of september as we are seeing, money market rates are rising liquidityening concerns and taking a look at the commodities space, we are seeing a lot of this continued for oil. you have a certainty over opec's toying with investor sentiment, they are one of a slide in oil prices which have been inflated
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by assumption that an applet deal will be extended and thewe are seeing for base metals in shanghai while steel is rising amid low inventories by copper, that is still on the best year since 2010, we are keeping the sentiment upbeat among investors -- he agent aboutd: a growing outcry forcing marvin workers from their home in beijing. called cityg cleansing. the workers say they have nowhere to go, tom mackenzie has a special report for us. who build and women and service china's capital are being forced out of their homes. tens of thousands of migrant workers are being evicted with a city cleansing drive -- the
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biggest city cleansing drive in nearly a decade. >> we still chat on social media, they tell me that beijing does not want us to stay so we are going back home. >> the authorities say this is about tackling dangerous housing and unlicensed businesses. many here see it as a heavy-handed campaign to drive out beijing's migrant population as part of a broader push to beautify the city. these people are factoring construction workers, delivery drivers, a labor force that keeps the city running and services cheap. >> people were given very little notice, they were told they had about a week to pack their bags and move out of homes they have been living in for up to a decade. the conditions aren't great but they have been given very few options about where to go to -- from here. those who have been able to find new homes have seen their rents more than double and they said they will struggle to make ends meet. to ask is moved out on such
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short notice will increase our living costs, it will go up and00 yuan with the rent total, that is several times higher than before. >> many have no option but to take their few belongings and return to their villages. tom jones from beijing, this is a long way from the chinese dream. i think this chinese dream idea brings pretty hollow. as i pointed out, these are men lived andwho have worked in beijing for years, sometimes more than a decade. they played a central role in driving beijing's economy and then they have been told and given very little notice, sometimes just days to move out of their apartments and they have been given no help at all from the central government or the beijing authority.
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the government says this is all part of an attempt to tackle health and safety concerns around where these people live and work. a number of questions arise from that and that is why they have allowed people tens of thousands to live in unsafe conditions for years and secondly, why has no provision been set up, no help at all for these people when they have been worst out of their homes, those are couple of key questions that this campaign to continue. certainly there is and has been a broader push by the authorities to gentrify the city as i mentioned and state media has made great play of the 30 million square meters of illegal construction they say has been demolished in the first half of this year and certainly there is a push by the beijing authority to cap the population as well. 8 million margaret workers have been believed to be living in beijing. they want to cap the total population by 23 million. the way this campaign has imposed on people, the way it has affected people on the
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ground is creating a lot of resentment and there is no surprise that we hear from some people that they had one person turnaround and they said that when the communist party is who we blame. what is the reaction from the authorities to that public outcry? onwe did hear from them sunday, beijing's party bus has the that in some instances, campaign has been pushed through to quickly, it should not be rushed, it in no is suggested that it was going to be stopped or halted and what the authorities appear to have spent more time on his censoring online comment on social media, anything surrounding this issue. we heard there was a petition signed by over 100 academics here in china saying that this was a serious violation of these people's rights and condemning authoritiesn so the
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are under pressure not just from the people on the ground who are angry about what is going on but also from the academia and artists here in beijing, interestingly, some in the business community are reaching out to some of their workers, they are delivery company, they have said we will strive to help you find him. we will put money aside to help you find rented accommodation while this is going on, it is affecting services here in beijing. we are talking about a use number of people, more broadly this is touching on a crucial fault line in chinese society and that fault line is between those who live in relatively prosperous cities like beijing and have the registration papers that allow them to live here and get the benefits of living here and then those from the countryside who come to work in the cities and there is a clear divide between these two sets of people and this fall and has been exposed by this rather ruthless campaign that is going on in beijing at the moment. rishaad: tom mackenzie in
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beijing. .e will continue with this marcus says could fall for the first time since 2014. jp morgan is coming out and saying that credit is tied to next year. they do assist here. one of the wrinkles -- what are the ripples better coming? >> china's campaign to call the property market predates some of his more recent moves to cool leverage and credit in the financial system and what you are seeing is the convergence of these two campaigns that will take -- analysts are inspecting was a a lot of wind out of the sails out of the property market.
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seeing the, you are existing campaign take away either demand but you also see developers struggling to pay developers. >> it goes beyond the housing market. the wider economy is bound to be affected by that, what are people saying? >> any slowdown in the economy will have ripples to the financial system. the flipside is that if the property bubble goes unchecked, it will have a disproportionate impact on the economy and it presents these bubbles. it is a very delicate balancing act that the government has to embark on, on one hand, colin sentiment and speculative buying to an extent that it doesn't pose a bubble risk. at the same time, not choking up
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one of the key drivers of the enemy. rishaad: what about the world of prices? the verdict is that it is going to continue to be among the world's priciest markets next year, there seems to be no slowdown in demand. we have seen some records as in hong kong over the past month or so. that is not just on the residential side where you see all things snap up or almost 1%. are also seeing records on the permit -- commercial property side and you are seeing land prices going through the roof. in hong kong we will see another big year in 2018. still ahead, we will be thatssing emerging markets is next, this is bloomberg.
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♪ >> you are back with bloomberg markets. president trump spoke to the fed and it wasn't pretty clear as he prepares for his confirmation hearing, he is not here to check things out. aim isell says that our to sustain a strong jaws market gradually toward our target. we expect interest rates to rise somewhat further. angeles, over to los this is the head of portfolio credit management. tell us about the market view of jay powell and whether he will be rocking the boat in any way because it seems that he won't be.
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perhaps it is deregulation with the story lies. >> i would say that the regulation is a big story because what they will ask about is the dodd-frank regulation being not dismantled but at this being as easy or community banks. if they could be more capital into themselves and the best, all of this is part of this overall view of how that policy goes from here i toward the economy, not as low interest rates that we have seen on the previous cycle, also with the idea that gdp estimate is boosted and the trumpet ministration is very clear.
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rishaad: how people -- are people too complacent? >> i think what is going on with inflation is this research they came out to the fifth -- san francisco fed. driving thems are lower, this could change as we get a significant change in the legislation. that doesn't seem to be happening at this point. i think inflation is subdued because of structural forces and we also have falling inflation and a lot of emerging markets because of a few years ago.
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this is more like a behind the curve you on where growth will be in the u.s. next year. like a stronger gdp. that has evocations to emerging markets with a fight as we have been witnessing and the dollar is treading water. >> it is. i think the flatness of the curve is a signal of something changing. we have the economy growing relatively ok but we have a flattening you curve driven by short-term interest rates. there really strengthen the dollar but rather, the weakness of the dollar. that has been very favorable to emerging markets in addition to the emerging markets. so far that doesn't seem to be
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any significant weakness there. in addition to the dollar itself, the dynamic of that is a portion of strength in emerging markets but at the same time some political center that still surrounds the tax reform. interestingly, this is on north korea and those headlines. those are going into next year, these will continue to have the dollar on the weaker side rather than the stronger side. >> if we see equities again it couldstellar year, have a more stellar year. if we have a bad year for equities coming in 2018, what are the implications for emerging-market benchmarks, is it that they are strong enough to outperform and not to thank you for what is going on that the -- in the developed world? these evaluations
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among investors and they start going back and emerging markets would be impacted by that too but to that point, there is still a relative evaluation difference for emerging-market and equities in general. a lower valuation, there is scope for a performance with e.m. versus dm. i think they will emphasize a gradual tightening, not too much of a change in that relative value difference at this point. other than that, their scope for emerging markets to outperform the developed markets. abouthink he wrote dollywood and being a big year and risk. end risk.n >> you have a tightness in
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dollar markets, that means dollar funding markets because a lot of banks and corporations fund of the year-end. last year, some of the more senior, this is building, what is happening is because of the short majority interest rates rising that put a little pressure on dollar funding and that in itself could cause some tightening of financial conditions. i think the movement we have had in high-yield and even in local currency and emerging markets were impacted by the dollar according which is really demand for dollar funding and that may pick up a little more over the course of the week as we approach the year of the -- the end of the year. aboutd: i will talk to 2018. i have -- i want one idea for you or one big thing that you think will happen. breast asking the
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question, i do think that the big thing that will happen is we closer -- etiquette will be a big event because does signify economic change that has been historically the case that will be important to watch. the other big thing is the secret has growth same and how it will develop next year and we have had some pretty good growth everywhere, most regions and so if that continues, that will not be an important thing. my sense is that it will but it could be derailed by if you're getting more tightening measures as the year goes on by central banks across -- not only developed markets but emerging markets as well. pleasure, there are partners there from los angeles. more to come including a look at insolvencies viewed
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brought to this company. this is bloomberg. ♪
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♪ this is bloomberg markets. i am rishaad salaam.
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surpriseds has been by the untimely and premature action of china development bank which is reportedly filing an insolvency suit against this wireless operator in india. the embattled company controlled by billionaire defaulted on dollar buys only this month. pharmaceutical shaking up its management banks in a company wide reorganization with was biggest maker of genetic medicine, this is emerging to its operating division this is across the regions. this is what they call growth find morehey need to than double in the market value. have held thenese lowest in almost seven years. they have been examining will if
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china still imports threaten u.s. national security. but the at least on the last year, that is when the obama administration passed import tax. trucks app emerged. ae deal uniting these two is remarkable turn for these companies that accused toyota of underhand tactics. they will no fund expansion in an industry that is estimated to be worth $750 billion in china alone. it is david up next on bloomberg markets for the next hour. what are we watching, what is on the agenda? collier on.ve karen
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they said equities is not the place to be, he still thinks it is asia. i'm going to ask him how those two things come together. the other thing we are following is another case of data falsification. singapore is actually losing its advantage to hong kong when it comes to ipo. that will be interesting, especially when you have a lot of these fintech ipo's come into the market next year, interesting narrative of course.
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>> it is a must 11:00 in hong kong, 2:00 p.m. if you are watching out of sydney. welcome to bloomberg markets: asia. ♪ >> jay powell defending the status quo. he says he wants stability and not a shakeup. looks at the broken dreams of china's migrant millions. we have a special report from the streets of beijing.
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they want a 30% discount for over. that will be very interesting if you want to look at that. we will be putting out the story , it's stored of levels off more stabilized, it is the samsung story. yesterday, long story short, morgan stanley came out with the we haveand since then had six other brokerages come out and say morgan stanley you are wrong, the stock is a buy. very interesting, we brought this up. we have morgan stanley seeing equally 2.8 million was the price targets. the average still about 3.4 million, the stoxx are flat, a 5% drop. we are ahead of the 100 a moving average. two -- we between the
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had back in august when mid august of this year. that is where the whole narrative is word comes to this semi conductor store. stocks look to be the new pillar of support sophie will tell us what that is all about. the insurgency, the cost has been maintaining gains throughout the morning by a third of a percent. investors are not only shrugging off these for samsung but these concerns that north korea may be preparing a fresh missile test, we see consumer stocks lead the way, helping discretionary shares in about 9/10 of a percent this morning. perhaps there is a developing picture of residence for the consumer space. orhad the sector recovery
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concerns, we have the rising household confident also being a last friday, this is consumer goods. spot, banks are a bright checking on movers, we have an agency investment same a good or risks is easy. this as measures to contain household debt. >> obviously, we will this morning, a lot of this comes down to daughter moves. >> for the dell you had that ongoing u.s. tax debate going on in the senate. we are look for it -- looking for a potential bug. the market has been directionless for a couple of weeks now and as you can see, .olatility has awakened
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we could see the yen attempt that 110 handle again before the week is up. cover asars may take opec meets on thursday. what is the story there? we had that big meeting on thursday but anxiety is creeping in. this is further away from a two-year high. 1975,n see this on #btv goldman adding to those warnings say that we could see a downside when he comes to oil prices was goldman says has been inflated by an uppercut deal being extended. membersrussia and opec with an outline of an agreement. it is. so just yet.
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-- it doesn't look like they are so just yet. >> they agreed to buy buffalo wild wings, 115.7. -- out to about 2.4. 146.40.heck, we are looking at 157 -- this worked out to possibly 5%. we will follow this. let's get you updated on the first word news with paul allen. : there have been repeated warnings that they are about to explode with 100,000 people are to evacuate. stranded tourists are until of these wednesday morning. indonesia raised its threat of a warning.
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gdp accounted for 10% of with the most popular destination. island is facing a growing political crisis that could bring down prime minister the overwrite cap. his deputy faces -- hello companies about after the handling of a please was about. the nose for the justice and may noy suggest they more than it appeared early. she says she did nothing wrong but the controversy could mean a snap election. the white house is said to be considering banning personal mobile phones at work. president trump has repeatedly complained about the lakes since taking office. the resources -- sources say they are driven by cyber concerns. said personal bonds are not as secure. bill gates has praised the charitable work by saudi's.
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in and he knows them into bloomberg -- in an email statement to bloomberg, he says he is enjoying the kids around the world receive life-saving vaccinations. his commitment to philanthropy is inspiring. ,lobal news, 24 hours a day powered by more than 127 journalists, i am paul allen, this is bloomberg. powell hasjay his hearing today. he was defending the status quo. but bring in our managing editor. we have to talk about powell first. the key takeaway? takeaway is that he
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is telling wrapping no change. even putting at the statement well in advance of the hearing to calm any kind of fear that this was going to be regime change at the federal reserve. almost a full day beforehand to make sure that everybody understands that he is on the same page with the current federal board of reserved stance. i think we can expect that he will go back to this prepared statement as a key -- at the q&a. this is when people start pressing him on the policy outlook that the tracking of the balance sheet will be very gradual, the move up in interest rates will only be a somewhat higher terminal rate than what we have right now.
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what market players will be looking for his questions that address the presumptive reaction function with regard to policy. let's set that aside, we understand your policy outlook here. viewis going to ship that russian mark if things move in the economy in certain ways, if things move inflation with the unemployment rate or if things moving markets, there is a in someng narrative analyst notes that jay powell they put more focus on financial stability and what is going on in markets and lending with his banking background and his private equity background, his thingsreet backgrounds, like inflation, that those curve and more economic theoretical
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perspectives that janet yellen brought as a career economist. >> i'm guessing a little less academic in terms of focus. he's really more for the markets. he is essentially underscoring that it is not just powell we need to talk about, there are a lot of other most be filled with the next year. -- said that year. -- fed next year. janet yellen said she would leave the board when jay powell is confirmede he and takes her leadership position in february. she will vacate the board and that will lead us with just three, they're supposed to be have powelley will
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who is a trump appointed and another who is in up -- obama appointee. the kashkari who is said thats president the first two picks have been good with powell for chair and randall for quarrels as another board member, we need to keep that pace going and flush those out. the policy setting committee, the fomc has 12 members seven of those are supposed to be from the board and five are from the february,anks and in there will only be three on the and of the five district bank presidents, one of them is to new york and the new york fed president bill dudley says he is out of there in the middle of
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next year, we have a lot of vacancies coming that need to be filled and he is putting a spotlight on the need to keep going on this point. >> we are talking about mr. corroded today, why? he was out there this morning, i think it was one of the anniversaries, marking two decades since the asian financial crisis began. he is also up there later. what is interesting about that a fewroda is years back, there would be a lot of focus on his appearances at parliament, there was a lot of angst over the bank of japan not doing enough to support the economy and later on that it was doing too much, the yen was , the boj wasast shaking things up with negative interest rates which spooked some of the older population
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that focuses on savings and returns from pensions but nowadays this just isn't getting the pension that it once did, it of the fact that the economy is doing somewhat better in japan now so the pressure is off the boj a little bit and boj policy looks like it is essentially on autopilot, they had the yield curve control with a 10% target for tenure yields. they don't appear to be moving anywhere for some time to come. ondon't see the focus governor kuroda's parliamentary parents that we once did. >> thank you for wrapping everything up. several singapore in companies chose to list in hong kong rather than back at home, we will ask why. we will be speaking with the ubc are presented at about the
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current bull markets, this is bloomberg. ♪
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♪ >> breaking his right now, the bottom of your screens is the domestic holdings. now said to be exploring while preparing to sell is 20% stake in pharma, we are looking at a $1 billion transaction. that is a going to people familiar with what is going on at the moment, we could see some interest from strategic buys including matsui, that is the japanese trading house. the stake sale is $1 billion in pharma, that is the asian-based drug just a bitter, they found in 1922.
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we will set that aside for the moment. the other thing we want to talk about is the fed. we'll be waiting for jay powell. comes pick to head the fed. -- trump's pick to head the fed. " our aim is to sustain" he was to move it up toward our target. he expects interest rate to rise somewhat further over belichick to gradually change. tell us how this actually affects their assumption. kieran, nice to see you. i am looking at your conviction trades right now, we will talk about them in detail, i wanted to get your thoughts on how assuming these fed hikes, does that affect your decision at
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all? inknow, we think that is line with our expectations and probably the market, from the markets point of view, everyone says that the market hates uncertainty but the markets are about uncertainty. in this case we have a little bit of uncertainty that the fed will stay the course for a while. it is supportive of our positive you for next year. >> one of your key conviction trades, i have asked this question to just about all of our market guests the past two weeks or so, none of them can come up with a single reason not to be around japan, kenya? -- can you? >> the reason we think that japan is a story for 2018 is driven by the earnings recovery story that started last year as more than a year old, earnings in japan are at an all-time high despite the fact that the yen has not been particularly week
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and we think this continues into the first half of 2018 and we ay get the extra kicker of slightly weaker yen if we do see the fed rate a little bit and the bank of japan keep in the yield curve control target of the jgb tends had zero, that should weaken the yen. that could be a bit of a tailwind. to add your question, do see a reason not to be wrong bus and mark anything that would upset that earnings recovery story would be a reason to reevaluate. >> the other thing out to point out is that you are also seeing the making of a long cycle turn when it comes to commodities at if i was six years if it is not really being supportive. what signs are you seeing that this is about a start? >> this is one of the themes has a few years of
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legs and we have introduced it in our 2018 outlook. we think the global commodities so we probably get a slow rise over the next couple of years. one of the main drivers is what has been going on in china with which isy side actually slowly taking a pass of the of the market and coming into a supply and demand balance. for the viewasis we are seeing a long-term -- we have been in a bear market for five or six years already. we think that is set to turn. i would just bring up bitcoin, not because it has been in the news and a lot of people have been talking about it, is it worth looking at equity proxies a bit? other any proxies that you may be looking to examine?
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proxies are not really obviously, there are a couple of etf's out there which trade is a big and premium to the underlined, you can look at that a couple of ways i didn't actually overvalued or reflecting equity premium or vehicle theyat their price to go quite a bit higher. to the are recommending clients from an equity point of view, there is nothing that correlated. -- bitcoin related. >> do you ever call your making for 2018, is there -- has the bar been set to high when it comes to earnings? andhave the slow-moving tightening fed, possibly even the ecb.
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those things don't quarrel -- coexist. the backdrop to that is that the earnings recovery story that we have seen in japan, that also -- ies to asia the quantum is not as high as japan and we are not at an all-time high in asia but we are doing well and that is still there are rising rates in the u.s.. a year ago, back the market was expecting 3% this time and that was inspected be quite a headwind. the dollar weakened significantly, number this -- headwind or
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tailwind for the earnings recovery story, we are seeing in asia. we are hoping it remains a little benign through the course of this year. corporate sets time to adjust, certainly a headwind, potentially. >> think you so much for coming on the program. ,he head of is equity research bloomberg is playing hardball. we are looking to drive away with a discount, we will have details, next. stay tuned, this is bloomberg. ♪
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may offer to buy shares of bloomberg at a much lower price than expected, peter had the latest, talk about cyber monday deals. in terms of the softbank
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investment, it looks like it to be quite a bargain. offermpany has made this tubers investor, they are a discount for about 30%, they will put that offer in and then they will let days, wer about 20 will see whether it was investors will be willing to take his big discount to the latest fundraising price which is about 69 billion dollars. they are trying to buy in at for substantial discount uber which is the largest ride hailing company in the world. >> it is successful and they do manage to convince the investors that it is a good price for the company, what will softbank do ? making the case that there should be a discount
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because it has been a very rocky year for over -- the former ceo resigned this year in part because of pressure from facttors, they have this that exposed data from about 57 million people including customers and drivers and they are saying it is a recovery time for uber right now, softbank with the portfolio of right having states would be in a position to encourage the companies to collaborate with each other, a are also in places where they want to merge operations, for example in southeast asia they compete softbankhe two properties and then maybe it would to combine those. >> thank you so much, peter joining us live out of tokyo with this financial deal. one thing we are watching went out your reopens is tokyo plunging over 3% in the morning session.
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the 13 client affected are still the company's customers, the reopening of tokyo and reaction next, this is bloomberg. ♪ is this a phone?
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♪ david: this is "bloomberg markets: asia." lot of eco-data to parse through today. china, time to step back and get a sense of where the china macro story is relative to g10. chart 2267. g10 top, china at the bottom, the feel-good factor has disappeared on the chinese mainland. everything else over the last
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six weeks has missed expectations. pmi gives us a kick. down to thes feel-good factor out of europe. let's get a check of markets. 30 minutes to the lunch break in hong kong. tokyo, some swings with the nikkei 225 and the underpressure --tom: pressure. shares remain under pressure amid chinese regulators halting approvals of mutual funds that invest in hong kong equities. authorities are likely aiming to prevent financial risk by
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discouraging investors from putting all their eggs in one basket. inancials of tracking banks underinese pressure after the regulator couldedly said penalties be possible. by kospi being led higher property and discretion stocks. investors are able to contain it against the kospi's moves today. easing for the industry as the government added measures to contain household debt. on the back foot today with most asian currencies today. the dollar little change with tax debate this week.
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the central bank seen tightening this mee week. currency, they weakening anticipated in the second quarter of 2018 as export growth has forecast to slow. , slippingk at the won chinese tenure bond yields. we are light on eco-data, but looking ahead to data this week. a mixed bag when it comes to the session and china, stocks, and the rest of the region. david: food for thought. thank you so much. let's get you an update of first word news.
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the breaking news earlier. singapore state investment fund explained the sale of its .take it has been seeking advice about offloading its 20% stake. uellig markets them to hospitals and pharmacies across the asia-pacific. japan has raised its threat indications north korea may be planning a new missile test. radio signals have been intercepted that suggests preparations for launch, get satellite images show nothing normal. president trump's nominee to head the fed says he expects the raisingbank to continue
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its benchmark rate and trimming the phone under his leadership. remarks, jerome powell also pledged to protect financial stability as the fes role as banking regular has was refining post-crisis reforms. plans to takep take a more prominent role in the tax reform debate. several gop lawmakers have not committed to supporting the bill. if the legislation passes, party leaders will meet to reconcile differences. london is becoming less affordable than ever with homes at 14.5 average earnings. is still up 66% meet 2012 and fails to demand from domestic buyers and overseas investors. also have cambridge
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price-to-earnings ratios in double digits. global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. this is bloomberg. david: j.p. morgan out with a note. china's efforts to cool the property market means home prices could fall next year. developers could find credit tighter and harder to come by next year. our initial financial editor joins us now in the studio to talk us through what this means and how the property market is looking and where we are likely headed next year. >> the government is going to keep these curbs they have rolled out over the last 20 months. there will be no lead up there. they have had success reigning in price gains, but the market started to cool as we have
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already seen monthly declines in sales and analysts are forecasting next year will see orgnant or may be no growth a slight slide in sales. the issue for the government sure they don't slow down too much. a manageable declined that does not hurt economic growth too much, but in the background will always be that concerned about how deep does it go. it is always a fine balancing act when it comes to property. ?iggest risks out there this renewed drive to drive out asset leverage, management products is a key source of financing for developers. is that one of the bigger risks out there? >> one of the big risks is an
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excessive slowdown which hurts is in, but another one the affordability area, having adequate rental housing, more sort of social issues. there are risks for the feelingnt, from people in the big cities that housing has become so unaffordable. bloomberg economics, some of their research was saying 22 years to pay off a beijing apartment on average income. dealing with public concern about that and dealing with public concern about some of the very inadequate rental housing and these problems in beijing recently. david: this is a question they have grappled with for some time. what is the long-term solution?
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>> two main factors, one with the government pushing ahead with the rental development. as more people are prepared to rent long-term, as more people rent and delay it buying, they think that will take some of the heat out of the market. . think analysts are divided the other solution is a property tax. a property holding tax so a cost would occur if you are speculating buying a house and keeping it empty. those two factors would be important for trying to deal
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with bubbles in the long-term. thank you so much for coming on the program right now. are staying in the property space and looking at india, have beatenpers just about every single industry group out there. chart.look at my this is the real estate index , it seemserall sensex the bears are running amok in india, 26% gains. it has been one of the best-performing markets overall, but of that together with property stocks, it makes you rethink that thesis. let's get more on this. people think it might be a little bit over done, but one
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sees thisout there continuing. who is the brokerage? >> it is not a brokerage. it is one of india's oldest money managers. the sector has beaten every other industrial group on the sensex and headed for its best annual performance since 2007. outlier. the typical of cycle in real estate lasts about 4-5 years, and the current uptrend is only a year old, so he clearly expects this rally to extend into 2018 and beyond. david: beyond that what will drive the rally? what else did he say?
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>> essentially two things. size, which is huge, and the refunds the government has put in place earlier this year. drives a very large swath of unorganized players from the sector. that will be a clear shift in the unorganized market towards the organized sector, benefiting developers that this fund is interested in. the size of the market itself can potentially be very large. you might recall the sector was amongst the worst hit by the currency ban last year, and a couple of things have happened since. the government to prop up the has brought in the
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program it launched in 2015, bringing affordable housing to every indian. could spark ae boom that reaches $1 trillion over the next seven years, so they are looking at a very large e.rket siz the second important thing is we have protections in place to protect the rights of homebuyers. that forces compliance. there is so much to talk about, especially given the sky high numbers we are talking about potentially. thank you so much for coming on the program. just an update on the other breaking news.
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roark is said to be planning to buy buffalo wild wings, a premium of 34% to the last close. the other piece of news is the merge buffalo wild --arby's but keep the two brands separate. that is the latest on this potential transaction coming through. coming up, another blow to sapanese manufacturing' reputation. details coming up next. this is bloomberg. ♪ is is bloomberg. ♪
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♪ the carbons look at fiber manufacture down in tokyo after the company admitted fake data on its products for more than eight years. month we became aware of posts on social media and had inquiries from customers . we felt we needed to disclose the facts rather than have rumors spread further delay the public announcement until we had all the facts. david: let's understand what those facts are. let's bring in our tokyo bureau chief. japan, another blow, what is happening? >> indeed. toray has admitted they falsified data for eight years,
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which has affected 13 clients. were over 130 cases of falsification, but no safety issues raised as of yet. in a series of corporate scandals that hit japan this year. previous to this was mitsubishi material. we are still trying to figure out what has happened. toray has not disclose details on why this came about. the question is a foul it one. -- is a valid one. david: it seems like we're getting one a week. you look at the nature and texture of what they are saying, it is not so much they did it last year. they have been doing it for years. why are we seeing so many of these things come up recently? >> i think there is more than
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one factor for why that is. every case has its own specific reasons, but a couple love underlying factors which people ,ave raised that are legitimate the corporate culture has prohibited workers to speak out about wrongdoings has been cited as a reason for some of these cases. another is the factor that in companieshese events, are now being forced to come forward with some of the information they might have known previously. the fact the scandal itself has now become a spotlight is true bring more of these cases to come out. david: we will keep an eye out for new ones to come out. thank you for coming. let's switch gears and give it
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to new energy. bloomberg new energy finance has released its latest report on clean energy investment, which countries did well, did not, and which stepped up to the mark. let's bring in our analyst live out of shanghai to talk about this. i have seen the report, solid numbers. give us the key takeaways. >> hello. in summary we have two main takeaways, good and bad news. clean energyhat investment in emerging markets dropped by $40 billion from $150 $110 billion15 to in 2016. the good news is that for the first time ever emerging nations
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have installed more solar capacity than wind capacity. have capacity additions 234ed from 22 gigas gigawatts in 2016. 34 gigawatts in 2016. david: help us to understand the relative changes. over the last four years, china tops the ranking and is the most attractive market for clean energy investment in emerging markets and probably in the world. although china tops the ranking every year, what is interesting to see how the other top countries are doing.
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yearyear again after one going down in the rankings we have brazil in the second position. thewould have jordan taking third position with a record energyr clean engine and investment, and in position number four is mexico as a result of strong policy framework that has opened up the country to clean energy investment, then we have india. top five.t is your thank you for coming on the program to break down that report. breaking news out of india, rcom lower.r co there is your cap there. has askedlopment bank an indian tribunal to
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place reliance, underications stewardship. more coming up. this is "daybreak asia."
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♪ city seems to be losing its home advantage for listings. let's have a look at this battle between singapore and hong kong as financial hubs. what is the headline and why is it happening? the number of singaporean companies coming to hong kong to list is up dramatically from previous years and so far 13 in hong kong and 14 in singapore. david: any slight difference
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between the two? the numbers speak for themselves. we have not seen this many come here, but what are we missing? >> the singaporean companies have raised $2.5 billion, whereas the ones who have come to hong kong have raise $700 million. you can certainly see singapore is still in the lead. it seems the ones in singapore have an edge. david: is this something we should expect next year? in that theing bankers will be happier here than singapore? the world's is fourth biggest stock market. we have had $15 billion worth of ipos. hong kong is a bigger market.
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we had a quote in our story from the ceo of razer. he said hong kong is the perfect place to raise capital and down the line you have the prospect possibly of some kind of ipo connect with the mainland. we did a story earlier this year and that is definitely in the hong kong exchanges plans. if you can access mainland money, that will make an attractive proposition. what is the counter argument? what is the attraction of singapore staying in in the context of this story? >> the home team, home soil, .ules and regulations they are doing everything they
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can to encourage startups. they are trying to ensure the company stay home grown. the next big thing for hong kong would be to see if they can get the funds raised anywhere people to singapore, but for now the home team has the advantage. david: thank you. yousef gamal el-din is with us and by. >> we have quite a few key themes. jerome powell and the confirmation hearing ahead. looks like he will be defending the status quote. theut through all that with managing director of global markets for a pack. c. apa we widen out the currency conversation and get views on
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oil ahead of the opec meeting and some of the middle east strategy ideas. that is all we have. bloomberg markets: middle east is just ahead. this is bloomberg. ♪ bloomberg. ♪
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♪ jerome powell it defends the status quo and says he wants stability in fed policy, not a top-down shakeup. >> janet yellen is due on capitol hill, defending her record in the postcrisis recovery. arroyo is snoozing through middle east tensions ahead of the opec meeting. softbank plays hardball

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