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tv   Bloomberg Best  Bloomberg  March 30, 2018 10:00pm-11:00pm EDT

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>> coming up on "bloomberg best ," the stories that the week in business around the world. >> global stocks in glut, with investors on edge around the world. >> headlines around trade war, emergency players coming into play. and the tax sellout, there is this drama in markets. >> pressure mounts on ceo mark zuckerberg. >> mark zuckerberg said if i am the right person to answer these questions, i will do it. congress said, uh, you are the right person. >> autonomous driving faces a check.
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>> there is a lot of speculation. we should be cautious. >> nothing is more important to us than safety and the brand itself. world the u.s. stands with allies in getting russian diplomat the boot. kim jong-un pays a surprise visit to china, while the u.s. and china tangle over trade. >> i think if it keeps going, this could be very disturbed. i hope the temperature can be taken far down on both sides. >> we could have an impact on global gdp. >> imf managing director tells europe to get it together in the capital market. >> they came to a close accountability, but is still short of what is needed. host: it is all straight ahead on "bloomberg best." ♪
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abigail: this is "bloomberg best ," your weekly review of the most important business news, analysis, and interviews from bloomberg television around the world. let's look at the top headlines. the week began with western allies punishing russia for a nerve agent attack on a former spy in the u.k. >> the west clamping down on russia in a coordinated response to the chemical attack in the u.k. earlier. the european council president donald tusk said 14 countries would expel russian diplomat. >> the white house retaliating for the response to the chemical attack in the u.k. earlier. the european council president donald poisoning of a russian spy in britain, ordering 60 russian diplomat to leave the u.s. and closing a seattle consulate. >> the russians have been looking forward to seeing cott
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corporation, and what they got -- seeing cooperation, and what they got is expulsion. i think the kremlin will respond in kind. it has lost a bit more hope they can find a way to work with donald trump after so much of trump'sessed after mr. election. host: there is no shortage of superlatives for the game today. the s&p 500 making its biggest one-day gain since august 2015. u.s. stocks rebounding sharply from their biggest weekly selloff in two years. >> to a certain degree, what happened last week was the trade issues and broadening of trade. it was not just tariffs, it was the fear this would become more significant. it became to the point people were suggesting donald trump was no longer program, pro-business butro-growth, pro-business, part of the problem.
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then the headlines changed, the chinese are willing to work with americans on tariffs. >> asian stocks following the united states. remember those words from steve mnuchin, the u.s. trade secretary, he was hopeful a deal could be reached with china? president trump is trying to get the chinese to reduce tariffs, carving out the financial services industry. this is starting to look more like "the art of the deal." >> global indices back from the biggest weekly rout in two years. >> from this starting point today, equities can go higher before we get the next fullback. >> stocks lower into the close. the nasdaq down nearly 3%, whipping ba from the gamesck we
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saw yesterday. -- back from the gains we whipping saw yesterday. the risk off rally continues. >> there was the big stock selloff and come back, but today felt different. critical yield levels, 2.8% broke. i think that was the last straw for people who are traditionally risk off investors. it is just capitulating to the bal volatility we have seen. talk of trade war, emergency powers coming into play, the tech selloff, all this drama emerging in markets. >> the nasdaq begin to take lower -- to tick lower, leaving to the worst day since february. the nasdaq 500 had his worst day none on a daily basis were as bad as today. it makes the rally look like a
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dead cat. >> mark zuckerberg decided it is time to face the congressional music. the facebook ceo will appear before a commerce committee to answer on facebook's role in the cambridge analytica scandal. his decision to appear before congress has not helped facebook time to face the congressional music. stop, which dropped by as much as 4% trading tuesday, on top of the $90 billion loss facebook has seen since the scandal broke. what do we know about his appearance and what will he say? >> we know zuckerberg has come to terms that he will do this. he said last week, if i am the right person to answer these questions, i will do it. congress came back and said, uh, you are the right person -- we want to hear from from. >> no one could blame asian markets for playing follow the loser overnight. you look at the effective write-down, it -- effective
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breakdown, it continues to the tech selloff. beginse fangs really rattled by a host of factors. iscern over technology spreading globally. >> once again, technology leading the way, but this case, leading the way up and down, all over the place. 1%.nasdaq off 9/10 of >> you look at trading action today, you told me the curve would flatten, the 10 year coming down and the kb bank index would hold up, but tech stocks selling off,it shows how localized this is in a re-rating
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of tech. expel u.s.ill diplomats from its consulate in st. petersburg. >> we have seen that he was kicked out diplomats -- the u.s. kick out diplomats from the u.s. and russia has responded in kind. now sanctions against russia for what happened in the u.k. you see this broad-based response. a couple of justin points -- --couple interesting points, the white house wanted to take credit for bringing other countries on board. shift in terms a of how the president is willing to push back on russia. >> we've got some last-minute gyrations in the last hour of trading, with the index is peaking around 3:00 p.m.
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nasdaq closing up 1.6%, still the best performer for the day. >> volatility is repriced. earnings remain very strong. valuations have come down. i see the risk to u.s. equity a lot better than three months ago. ahead, as we review the week on "bloomberg best," an exclusive conversation with imf managing director christine lagarde, and why she has urging -- she is urging european countries to spur integration. >> they need to go a little bit further. host: first, more of the week's top business headlines. will restructuring at the top solve deutsche bank's problems? all that and more coming up. this is bloomberg. ♪
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>> this >> this is "bloomberg best." let's continue our global tour of the week's business story with china shaking up the wheels futures market. oil futures market. >> the markets getting a shakeup, china futures as the world's largest oil futures mar. >> oil consumers. it is a first for chinese commodities. the question we are asking, does is mean china will get a bigger say in pricing? >> this is a massive win for china, but very much a long-term one. we can't expect this to implicate features in the market in the short-term horizon. i am not saying weeks, saying
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the next few months or years. a serioushe yuan as currency. it helps chinese bond market. it helps the entire financial system in china. they have taken a long time to get there. they want to wait to the right moment, until they have full support from the gcc countries. this is big news, even though it is very long-term. primedsche bank may be to replace its top chairman, according to those with knowledge on the matter. why do they want to replace john cryan? he is in the middle of this apparent new turnaround push, and as i talked to him in frankfurt, it is taking hold. >> there are many voices saying cryan is not the right guy, some saying he is the right guy.
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he stabilized the bank and that is no small feat. bankworried about deutsche hitting a wall years ago. he directing -- he is bringing down legal issues, bringing down costs, those are all good things. but can he return this big tanker to growth? >> some say germany's biggest lender is conducting a review of its investment bank that could lead to cuts across its trading businesses. >> they are drilling down into the business to see, where are we still competitive? where are the focus points is the u.s., where they are facing strong u.s. rivals. the question is, do they still have predictability to compete simply -- ar is it re we going to scale back? >> the latest poll by a japanese
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news network shows prime minister shinzo abe's approval 32.6% overfallen to the past month. his disapproval rating has risen by 13 points, to just shy of 55%. over this is a scandal over public land and its value to a nationalist school operator with links to his wife. >> a former finance official who also rose to the head of the national tax office. he oversaw this questionable land deal where documents were forged, words used by the prime minister, that according to the finance ministry, removed the names of the minister, the minister's wife, who was to be an honorary of that anniversary, and also remove the name of the finance minister.
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>> he seems to be playing very well. he is still playing sacrificial lamb. maybe this scandal may not be enough. there are other scandals lined up. think it is becoming more likely that prime minister think it is becoming more likely that prime minister abe will have to resign before the end of the year. >> china conference kim jong-un did indeed travel to beijing this week, and president xi, four day stop of a pretty four day stop of a pretty secretive trip. what do we know? >> kim jong-un and his wife spent four days in beijing, including travel days, so about two days. it is a slow train crossing from north korea into china. this is what chinese media normally does. they do not reveal the details of such a trip until after kim has returned to pyongyang.
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at least, that is the protocol they used with his father. kim jong-un had never been to beijing, at least since he was the leader of north korea, so this is a significant one, because it also gives china a chance to consult with kim jong-un ahead of what is likely to be a summit with president trump sometime in late may. >> we had confirmation from kim that he would be willing to meet with trump. this is week after -- weeks after trump himself said he was willing to meet with kim. we have that on the first point. secondly as you mentioned, a suggestion that he is willing to discuss giving up nuclear weapons in these talks with trump, whenever they may occur. that is a significant step for a country, that about six months ago, says it tested a nuclear
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weapon. >> bumpy ride for tesla, and that is understating it. shares at one point falling the most in nearly two years, following a fatal accident involving one of its vehicles. the crash only leads to ceo elon musk's list of challenges. oninvestors are looking tesla's future, not its present, as a ridesharing and mobility autonomous company. on if there is a big setback in then thatechnology, is a real problem for the company long-term. >> once again, tesla urging workers to prove haters wrong. it is pulling out all the stops to hit its production goals. it is giving workers an option to work on the unlimited three lilne. >> they indicated in this email not on pace to hit
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their targets. they have some ways to go. they used this idea of, we have short-sellers down in us. let's prove them wrong. >> saudi arabia has earned secondary emerging market status. it could attract billions of dollars of investment and help the kindgoms move away from an oil dependent economy. >> this is a recognition by the international investment community for the reforms that the saudi stock exchange have taken in the past 18 months to address the requirements of opening up the saudi stock morenge and pursue a we more attractiveness platform for international investors. see the biggest market in
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the middle east. we are adding q8, see adding the saudi market gives greater exposure to the middle east. investors have shown a real interest in this region. merge,an in talks to creating an automaker under one stock. the chairman of both companies is thought to be driving negotiations, and would head up the new combined entity. >> the french government also plays a role, the japanese government. that is the one to watch -- how will the french government respond? will they want to relinquish their stake in renault? does this water down their control? the alliance has been lopsided. has traditionally thought
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and more of the money. there is something that has to be done. by merging them together now, -- thatthat first is the first big step. has relinquished some authority over nissan to focus on the alliance. watch him as the continued strong man in this. renault nissan has as a unified company will be a formidable force. >> barclays has agreed to pay $2 billion in civil penalties to settle a u.s. civil investigation. stephen morris is here, u.k. banking reporter for bloomberg news. waiting to settle this case paid off for barclays, didn't it? >> most paid what the department of justice asked them. barclays took a contrarian bet -- take us to court, because we don't think we should be paying any more money on this, and it has paid off. in 2016, they wanted to cut the penalty to $2 billion, and it
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paid off. a rare gamble for a bank paid off. ♪
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>> welcome back to "bloomberg best." bloomberg sat down with imf managing director christine lagarde. they met in berlin, where la rgarde gave a lecture on strengthening the european withg director christine union. >> why has european integration been so slow? >> i wouldn't say that. i would say in times of crisis where there is a necessity, they eventually moved very fast. the euro area was clearly incomplete and needed to be strengthened. they put up a firewall. they reinforced the banking
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system. i think they came to a close accountability, but it is still short of what is needed. they need more trust. they need more accountability. more to the point, they need to strengthen three things. one is the capital market, two is the banking union, and three is essential capacity that will signal to the rest of the world that they are shoulder to shoulder together, and they will face the next crisis with that rainy fund we are advocating. >> on those three points, the capital and banking unions, will we get a real capital markets union and the banking in our lifetime? >> in your lifetime, yes. in mine, probably so. those are the two most likely to happen. capital markets union, i think
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they are getting very close. i do not think they should set aim at closing and complete the job only when the bankruptcy law has been harmonized between other states. my suspicion is they should set a few targets that operate as a common platform. many elements are there already, common standardized documents, access to the entire market, but they need to go a little bit further. given what is happening on the other side of the channel, the fact that brexit is going to happen, whatever the terms afterwards, some of the is going totivity move to the continent. it is important that the euro area be a joint properly operated union. thanking is going to move to the continent. market might take -- banking market might take a bit
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more time. one thing i think is there is this fiscal backstop, which will be very welcome. where it is going to be more gradual is on this issue of the common deposit insurance mechanism, where if a bank falls, then the depositors are protected by a mutual fund financed and operated by the banks. fiscal capacity will be more difficult. >> coming up on "bloomberg best ," conversation on trained and tariffs. business -- >> the psychological degree of friction right now could be quite serious for markets. >> plus, another exclusive
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interview, this timeinterview, i aramco ceo. >>
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abigail: you're watching i am abigailst." doolittle. in the days that the president against china,fs business leaders have been waiting to the potential consequences of a trade war with china. it was the topic this week. let us start with sergio ermotti. they start to get concerned. i think for the time being, the numbers are modest in respect of the impacts. the deliberation of these
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tensions on a bilateral basis. potentially escalating. this will not be good for growth or geopolitical reasons. at this point in time, we do not see financial markets of being overly impacted by this protectionism, i do think if it goes on, it it will be very disturbing. >> the market selloff on friday was pretty severe. why was it priced in? >> at the end of the day, you look at this and how it is difficult to understand the corrections that are coming as a consequence of those announcements. being, we remain constructive on growth.
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as i said before, we have to pay attention if this should escalate and create retaliations. particularly if it goes beyond tona and the u.s. and starts touch other countries. that could become problematic. abigail: former treasury secretary larry summers says the u.s. and china need to wild down the rhetoric in the growing trade tensions. dial down the rhetoric in the growing trade tensions. >> i don't think trade sanctions need to have a large impact on the global economy but does psychological impact could be quite serious for markets. it is both a matter of what actually happens in terms of psychology.the i hope the temperature is taken down on both sides. >> it sounds like you do not think china will escalate. >> i will not handicap or china
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will do. i hope everyone acts with restraint. acertainly hope it is negotiating stance. as ronald reagan said of nuclear wars, trade wars can never be won and must never be fought. >> some are wondering how this will factor in two policy at this point. >> i don't think the impacts are large enough to affect the fed. she is concerned about trade sanctions. as much as 90% of the products move between the two countries. the trade war would affect global gdp. absolutelytrade is essential. we believe in free and fair trade. that if youdoubt want to create wealth, free
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trade is an important driver. if you look at the example of the mining business, it is absolutely essential. we have two key drivers for business. gdp and the other is trade. the me give you an example. 80%-90% of our product at rio tinto is moving from one country to another. trade is essential. the recent announcement of last night, clearly if you are going to ask me if i am concerned about this, we are at -- we are watching this carefully. both china and the usa are great trading nations. i am sure that if we understand hope andof trade, i i believe common sense will prevail at the end of the day. i hope these countries sit down together and work out their differences. are we concerned? i stiller is, yes but
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believe common sense will prevail at the end of the day. let us see what happens in the next 45-60 days. they will be essential. international the stability of the trading system, it is critical that china stops dealing in -- stealing international -- intellectual property. and that they end the pernicious practice. .t is a minority joint venture that does not work for long-term corporate growth and earnings. all the president is doing, all president trump is doing is asking for fair and reciprocal trade, free trade, fair and reciprocal so we can have stability in the international trading system. tradenow, we have massive imbalances. he is going to change that. >> peter, i'm going to ask you a final question. -- the united states
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are going to unveil the tariffs on the chinese products. which products? high-tech goods? >> certainly, the focus of the on the chinaocused 2025 industries. china has brazenly released its china 2025 plan that basically told the rest of the world we are going to dominate every emerging industry of the future and therefor for your economies will not have any future. artificial intelligence. robotics. computing. all of those things. and the section 301 on intellectual property theft and forced transfer is specifically designed to address those kinds of things. and i think the world should welcome back. europe is being hammered by the same thing as well as japan. we are trying to add trade peace
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where we can have a regular free market system where we don't have to worry about things like that. give us any clarity about what we are expecting in on chineseriffs products or restrictions on chinese investments in the united states? >> the purpose of the whole thing is to try to curb the problems we have found with intellectual property rights. forest technology transfers. forest partnerships. forced licensing. cybersecurity breaches. all sorts of problems that are thegned to penetrate intellectual property rights of american high-tech companies. answertariffs the though, sir? a lot think the technology they use is used within china. the incomingn
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goods will not crack down on what we are seeing. >> i do not think that is quite true. there are codes and things embedded in high-tech situations that are not that easy to get from the outside or by designing backward from the finished product. if there were, the chinese would not be requiring all of the massive technology licensing and technology transfers that they do. so, the fact that they are doing it speaks for itself. >> what is the message we are trying to send to china at this moment, mr. secretary? look, the united states is preparing for a possible trade war or we are ratcheting up the pressure and we want to bring you to the table to do a deal? >> i think it is something quite different. in terms of steel and aluminum tariffs, the message was that we our trying to protect
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present-day products. in terms of intellectual property, the message is -- we are trying to protect the future. the intellectual property of today is the important finished product of tomorrow. so, the message is very straightforward. we do not mind competition that is fair and square regardless of where it comes from. we do mine competition that is on violations of fundamental intellectual property rights. feeling of how important this is, the u.s. patent and trademark office which is also part of the department of commerce, sometime this summer will issue its 10 millionth patent. there is no country on earth that has ever issued anything remotely like 10 million patents. that is the key to a lot of america's success. the technology -- the
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technological leadership. we cannot afford to have that stolen or strong-armed away from us. >> i understand that, sir but now it feels like the strong arm is coming from the united states. that is the caret here. ist about the caret -- that the stick. carrot?hat is the >> there is no strong-arming. we are trying to make this fair, the practice of years and years. ♪
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of the big global deals of the year is the highly anticipated ipo of saudi aramco. have been reports of investment skepticism around the offering. and possibly a delay.
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the ceo of saudi aramco is not concerned. he defended plans for the ipl in an exclusive interview with bloomberg's jonathan ferro. >> i think a lot of the questions and the media coverage about the ipo and when it will of demand fort the listing of saudi aramco. in terms of performance. show whentail that we we go on the roadshow. ultimately, that is how our reform is and how we are the highest and most efficient and reliable producer. this is a great company that the data will show their performance. >> when i speak to people, they are not talking about when it will happen, they are talking
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about if it will happen. perhaps the whole ipo will go into the deep freeze. >> there is still a lot of ongoing work. the company and the government did all of the paperwork to make it a joint stock company effective january 2018. that is an indication that the ipo is ongoing. aramcoparation by saudi never stopped. say auld be as we always company ready for listing in the second half of 2018. we are doing a lot of work to prepare the company for listing. at the same time, there are committees from the government that overlook what we are doing. making sure that we are ready for listing. accounts set a set of all ready? >> for the sales? >> for the whole company itself. >> the only requirement for --ting in terms of auditing
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we will be availing all of the necessary documents. >> it is not your decision ultimately when this will happen. i am trying to understand when it will happen. >> the government will decide on the timing. this is a very complex process. a company the size of aramco with its complexities. it requires time. news to a lot of listing. we are going to evaluate all of that and decide on the timing. the push for the time is facing fresh skepticism following the fatal crash of an uber self driving car last week. this dominated the conversation at the new york auto show. we asked car executives about the future of the autonomous vehicle.
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>> there was the tragic incident in arizona with the autonomous driving story. do you see the regulators putting the brakes, excuse the developthe efforts to that technology. , we dofirst thing believe in the technology. where everyone is getting lost is they view it as a race. we do not. we view it as making the car and the automotive environment safer. been ones that expressed caution. there is a lot of pt barnumerism . we should be slow and methodical. we always test with two engineers. one at the wheel and one in the backseat. you need to work with consumer understanding and with regulators that it is not a sprint. getting it right is what winning
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is to us. >> i think many people share that view as well. to what extent many of these developments have had free reign to develop this technology and whether the legislators will clamp down on this? >> that is what you are seeing in arizona right off the bat. the best thing with regulation is to have absolute transparency. they need to see the data. the biggest word we keep using is trust. do the regulators trust the technology? do the consumers cap -- trust the technology? and can we deliver? the other thing we need is we believe strongly that you need a federal standard. that will get away from bill states coming with -- coming up with different initiatives. caution is the name of the game. we are talking about people's lives. ford right now with
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respect to autonomous vehicles? waymo has done a deal with jaguar. >> ford is one of the top companies. inhave developed in ouargo pittsburgh. we are developing exclusive product based on hybrid technology so we can run the vehicle 20 plus hours a day. that vehicle will be unique for automated use. we are also betting on not just moving people but also goods. post-maidsing with and dominoes and lyft. we are in miami right now mapping the city and running the business model with drivers in the car operating the services. the drivers cannot leave. avy are simulating the experience. >> do you anticipate more
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regulatory oversight? >> the accident is really unfortunate. the reality is that ford is a 116-year-old company. to usg is more important than safety and the brand itself. for example, we have two safety drivers in every one of our vehicles. this is important because it is a new technology. test on public roads and in difficult situations. we are learning a lot and we are taking every precaution we can to protect not only our customers but also pedestrians. jaguar land rover making its way at the new york auto show. to be involved with waymo. the first all electric offering from the luxury organization. the chiefned by
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executive officer. why did you choose waymo? it is a prerequisite for modern mobility. cannot be done in isolation anymore. modern mobility needs partnerships with government, academia, and industries. we are leading in the electrification. and we look for partners who lead in their respective fields. at the end of the day, we are all on the mindset -- share your vision about mobile mobility. arewherever two partners coming together, they are creating something special. your choice isay unfortunate given the tragic news that we have gotten. rollouts slow down the
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of this ride-hailing service that waymo wants to implement? >> not at all. from my point of view, we are doing everything we can from the side of the car manufacturer. is outstanding in performance. and it delivers everything in the segment of security that you could expect from such a premium car. on the other hand, waymo has the most advanced data, algorithms, and safety and security systems so this would be a very good development for the future. >> chinese consumers in the past, when there were tensions with japan or south korea, they would boycott some of the cars. are you concerned about what a trade war between the u.s. and china could entail for chinese consumers and had lack?
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dillac?haca >> free trade is the growth engine for rising prosperity levels around the globe. in order for free trade to be sustainable, it needs to be based on fair roles of trade. i think that is a universal truth. >> there was a tragic incident and an autonomous vehicle in tempe, arizona last week. i know general motors is very active in this area. will this increase the level of regulatory oversight and slow down the process? >> general motors and cadillac specifically have been very conservative. believe thatlly beta testing and development is to be done in a controlled environment with the hands of control -- experienced
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engineers. if this means we have to slow down the rollout, then so be it. we are one of the leading proponents of autonomous capability. we have to be very circumspect precisely for the reasons that you articulate. to ensure the that the way we roll out the technology builds confidence in consumers and regulators alike. ♪
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♪ we are looking at the
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imac on the bloomberg which highlights this red versus green. the price ofg technology. the worst performers off by 2.9 percent. the biggest component of the market here. abigail: there are about 30,000 functions on the bloomberg and we always enjoy showing you our favorites on bloomberg television. a.b. they will become your favor. here is another function you will find useful. quic go. here is a week take from this week. ♪
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♪ abigail: that was just one of the many quick takes you can find on the bloomberg. you can also find them on bloomberg.com along with all of
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the bloomberg business news from the day. i am abigail doolittle. thank you for watching bloomberg television. 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 near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver.
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♪ emily: hello, i'm emily chang and this is the "best of bloomberg technology." an important step on the zuckerberg apology toward. u.k.eo's note the parliament but decides to testify on capitol hill. plus, uber agrees to sell its operations in southeast asia to a local rival. we will talk about what uber will get in return. -- questions

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