tv Whatd You Miss Bloomberg September 6, 2018 3:30pm-5:00pm EDT
-- overrule the court is. kavanaugh says he is not afraid to invalidate executive branch accident -- action in his 12 years as appeals court judge. he added a court order is the final word in our system. back in thees are u.k. assessment of the russians by poisoning. authorities have accused to members of russia passes military intelligence service of poisoning the former spy's -- and his daughter. may have accused russian government of orchestrating that attack. tona reiterated it is ready retaliate if president trump goes with a tariff hike on chinese goods. a government spokesman says china is confident it can maintain what it calls steady and healthy economic growth. the trump administration is to the post wi-fi percent penalties this week on $200 billion worth of chinese goods.
china haschina has announced a 0 billion list of american products targeted for retaliation. actor burt reynolds who starred in films including deliverance, the best little horror house in him -- and but unites. the actor suffered cardiac you -- arrest. global news 24 hours a day on air and on tick tock on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm mark crumpton. this is bloomberg. ♪ caroline: live from bloomberg world hecklers in new york, i'm caroline hyde. stocks pretty mixed. joe: the question is what did
you miss? index forrging market a second day cutting the threshold of the bear market. flex the chips are down. their worst day in two years amid concerns about weakening industry demand. cryptocurrency paring debt pay nearly 10%. >> despite major policy moves from emerging markets, officials could temporarily offer stability. the underlying their trend remains the same. let's welcome the global head emerging markets. great to see you. thank you for coming in. let's talk about whether we could see a balance here or if we could just go down. i want to look at a valuation just to show what it looks like when we get to these levels in
emerging markets. looking at the emerging market here, we have see got these evaluations. >>'s past performance indicates the future of results here. >> i think it is temporary. idiosyncratic -- continuing to hike rates. we have these that are not going away anytime soon. to me, those conditions are not conducive to any sustained balance. overextended,are but i think i remain merck -- on emerging markets.
joe: it's klein, but at some point, if you wait for all of the signs to turn green, and say ok, trade war is resolved in the fed tightening cycle will go to miles out and china is doing stimulus, most likely they will admit a huge leg up. by that point if they wait for it. what is the best way to play it? safest players, do you go for the countries that have been beaten down the hardest, like what is the best way to be exposed? now, i thinkght this has legs until into next year. 2019, i think the words get cloudier. full steam ahead in the u.s., so i think that quarter is good. when will the next recession be in the u.s.
>> i'm guessing late 2019. that is when the fed would start cutting rates. mostly the real problem countries are somewhat isolated. argentina and even turkey is somewhat large. the paper trail in the u.s. is quite long. it is hard to dry line of impact. , hardening insk china, we do know the economy is slowing. have enacted some stimulus measures. for now, it models through.
>> even if we get the dollars >> is not good for global economy. that is a good thing, what the fed has done. the next downturn, we have a juice to help the economy. negative interest rates, bank of , and the u.s.'s only -- the only game in town to deal of the session. a lot of moving parts. months,, -- it6 looks vulnerable still. >> are there any that you like? >> it is relative. despite slowdowns in china, asian country -- companies isolated. at bigre, you look
financing, external or budget deficit, within asia, you have india in trouble. not in trouble in terms of turkey and argentina, but one of the worst performance since asia. i would say we have the five worst obviously. argentina, turkey, brazil, south africa, and russia. they all have political risk and economic risk. i do not see this going away anytime soon. >> it seems to me has you lose and tails you lose. it is not looking so pretty. at what point does that relationship and? when does policy enactments such as argentina, according to the rulebook, it is doing the right things, when do we start to see the separation you can only game with emerging markets at the u.s. stops --
>> i have been around it for so long. i remember when we first started out, it was a diversification play. you could put some money into e.m. sold tradetime we and financial ties, a correlation between developing markets, quite high. much higher than i first started. soldjoe: has the correlation increased as exposure to e.m. -- >> yes. a lot certainly reflects that. it is interesting how the markets have evolved. people thought frontier might be the next countercyclical play but that has not proven to be the case either. even the higher data on global growth -- growth in emerging markets -- >> i quickly want to ask you about nafta and bilateral
agreements. we're getting headlines and maybe progress in mexico. as you look at the landscape, is there a play with peso or mexican stocks? >> everyone was very optimistic. once the news hits, it sold off. my view in mexico, i think it is underestimating the risk of ammo coming in december 1, and a do not think the snap story is inviting over. legislative and legal battle, that mr. trump says we can just go ahead with mexico, many in congress are saying no, we prove next and many go out. i like the mexican story. >> it is only the emerging market in the green.
legal dispute with viacom over the future cbs. our next guest is one of the only analysts on the street with a sell rating. craig hubert. he joins us now. does any of them news moving on or a deal to be done with the likes of i come make you look more positively upon the stock question mark -- the stock? >> i think like him has not pushed upon cbs, that would be a positive for cbs. it is an unfortunate and into a great career if it is all true and he is leaving and stuff. he has some great job running the company, no doubt. it would be a big hit. >> it seems as though if indeed
he will be stepping down, that wouldn't potentially make it more likely that we would see some sort of viacom cbs, nation, that we will see the ceo take you're cbs as well, already at a sell, do you go deeper at a sell, or do you think there is an opportunity for a bounce here at some point? why thatk the reason stock is up today is a change for family trust to make it -- we will see of that happens or not. in terms of who could actually run the company going forward, i think putting in place joe as interim ceo, i think that is smart. it would be even smarter however to make him a permanent ceo.
joe: in your note, you characterized the best house, cbs as the best house on the street. ultimately, our secular justinds facing the area too much for the best management team right now? >> real most of the words right out of my mouth. are, evens assets cannot overcome all of the problems out there. say netflix a thousand times but that is not going away. amazon prime, etc.. i give them a lot of credit on cannot overcome all of the problems out there. caroline: we have seen twitter and facebook and those guys under pressure. you're underweight when it comes tothat's -- on that front. twitter but overweight when it comes to facebook. where do we go in terms of concerns and also netflix as well you just brought up? >> i think just in general, we
have such a rotation going on with stocks out of the sector spooked,le getting some extra regulatory pressure is put on them by the government and stuff, holding in front of twitter and facebook's case, it is not very comforting from an investor standpoint. the question comes down to, can they self police given what they are being accused of, or will the government have to get involved. i have been great versus the rest of the market and people look for any excuse and here we are. >> and it looks like people are pricing in at least a chance that that regulation is coming to thank you so much. thanks to hubert research partners founder and analyst craig huber. a look at some of the biggest business stories in the news right now. activist short seller andrew is suing tesla and its chairman elon musk for inflating its stock price.
he wants to represent a class of and -- class of investors from august 7 and august 17, manipulated the prices of stocks to hurt short-sellers by issuing misleading information. after to be purchased burning a planned takeover by blackstone are the total value of the deal is $5.2 billion. boston and park central in new york. that is your bloomberg's newsflash. theline: time enough for stock of the hour. shares are falling on its biggest decline in two years. despite beating earnings expectations and revenue -- what is the company to do. know that is the big greeks. they make a lot of them. reported very good numbers
actually to their selling a lot of trucks and doing a lot of good things. sort of a cyclical company in any time you have a cyclical company putting up these numbers, you always have people thinking, is this as good as it gets? joe: i thought it was a huge demand in trucking right now. >> yes. i think we asked have a chart. at official data from the industry and government data, it shows you there has been huge increases in orders of trucks on a monthly basis. we are basically a record. but again, you have two factors. the cyclical issue, but some of this has actually been boosted by tax cuts. there was a capital expenditure deduction in the tax bill which prompted a lot of folks to upgrade their fleece and trucks. also makes school buses and dump trucks and these other big industrial vehicles,
so he got a bump from that. a lot of folks are may be thinking, this might not last. keep in mind, this was a company almost near death a couple of years ago and then carl icahn got on board and volkswagen took a huge stake. it really comes back to shares are down 8% or so today. they were still up prior to 28% on the year. it is not doing awful when you look at it over the longer term but for today, i think there is concern maybe they did not bump their forecast as much as people would like to see. basically the forecast they gave was right in the range. covered the stock in the opening bell in and rose as much as 7% initially. started,ially when it >> a lot of folks when they saw the numbers in the police, they were not necessarily impressed but were hoping maybe the ceo or the cfo would stay on the call. it might seem a little more optimistic.
caroline: what did you miss question mark some of the worst performer in the esper for -- are chip stocks. removed -- from its top semiconductor idea. chip stocks fell, let's bring in bloomberg intelligence semiconductor analyst. there are worst performance. is this the beginning of the end or a tipping point? >> that is a great point. look. if you look at the semiconductor sector, -- cycle, i think the fear is irrational but the question is what do we have, it still remains to be seen.
a mutedave more of cycle downturn at the end of the last few years, then you have a little of a correction, you pause and there are inventory clearances, that is option a. b, this is the beginning of a very extended weakness. the caveat is everyone is looking at supply. how much is it this year and how much is it last year. how much of supply what it take i think that is people -- i think they are not looking as aggressively. how much -- what is the relative content of memory in the average how different is that in cloud versus corporate ideas. these are all demand factors, therefore muting the cycle.
joe: it looks like investors are being somewhat discriminating. really applied materials getting hammered. something like nvidia, more specialized and graphic, it is down today but not nearly as much. still close to all-time highs. >> in a muted cycle, there is an opportunity. market share gains to be had ahead of it. case for aiullish but, in an extended downturn, people are not going to differentiate much between a and b. right? muted reaction -- >> in a real downturn, no one is safe. >> i am looking at a 10 year chart, it is up and up and up.
you have that tenure chart. it has been a long time since we saw any kind of substantial slump in these stocks as a group. >> right. semiconductors are the new building block going into everything. look at where semiconductors are mostly today, 30% of the debt revenues come from these and from smart phones. if you look at autos industrials, these are new greenfield areas. the stuff in the gizmo is growing. joe: so one day in past cycles where you have the boom and bust of computers and then maybe phones, now one day this chair will have a chip in it. >> look, yes. industrials have expanded substantially and so have cars. these are areas where the growth of semiconductor revenues from these segments is
disproportionately higher. 2-3 times higher than the unit growth of these devices in these sectors. joe: is it possible that sometimes you get a bit of an order and supply niche -- mismatch. the story is in tech but for whatever reason, these are complex supply chains with very long lead times and you have to make predictions quarters or years in advance about how much you need and how much to invest. intelligencemberg are certainly believers in that part unless we see a dramatic economic retrenchment of sorts and we don't think they will 20, 30, 40, 50% in negative returns from where we are today. we think there is negative potential for sure but it is hard to see from here. >> all right. thanks. i think only two stocks in the stocks today are trading higher.
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caroline: "what'd you miss?" stocks mixed as semiconductors fall as the nasdaq holds his 3rd avenue losses. the dow clings to small gains. julie: i am julie hyman in for scarlet fu. caroline: i'm caroline hyde. joe: and i'm joe weisenthal. welcome to the closing bell coverage everyday from 4 p.m. to 5 p.m. eastern. julie: we begin with market minutes and stocks. we are seeing this divergence once again with the dow performing better here because a lot of the selling is concentrated in technology. nasdaq is down for the third tense -- is down for the third straight session. this is the deepest three session slump since july. it is notable that we are kicking off september here. a period of increased volume when people are getting back to
work. the volume in the nasdaq specifically about 22% above the 20 day average. if you look at the 100 day volume, about the same level above. people are selling in tech in relatively high volume. speaking of tech, we just talked about a semiconductor maker, the worst stock in the industry currently. there is analyst pessimism we are seeing within the semiconductor industry. we are also seeing pessimism in the casino industry with when resorts walling -- wynn resorts falling. they cut their las vegas revenue per room. high alert has been issued for a fever. twitter is down about 11% over
the past few sessions. we heard from jack dorsey before congress and their concerns about regulation. finally, cbs with a potential after les moonves. joe: let's take a look at government bonds around the world. a little bit of nibbling in u.s. treasuries but not a lot of action. two year yield is down one basis points and 10 year yield is down to basis points. we talk about the breather in the em space, not so much. indonesia include the 30 year yield up 56 basis points and the brazilian tenure up to 12.6%. even on a quiet day, some backing away from long bonds in em. caroline: we saw some reprieve in the currency market and
that's largely because we have the dollar index on the downside. it was up 2/10 by 1%. i'm keep in -- keeping an eye on the loonie. the top officials are debating whether to accelerate the pace. get discussed whether to rid of the turn gradual and the canadian dollar strengthens. the argentinian peso is also strengthening. 2.7% higher against the u.s. dollar. it's the second a day gain. they met with the imf and will they get more of the credit line sooner? the ruble was weakening down 1.5%. the ruble is tumbling to its weakest in two years. they said the nerve agent attack by the kremlin and monetary policy issues at play.
joe: let's take a look at commodities with oil and gold. not a whole lot. oil is falling below $60 per barrel. it has been in this range forever. gold is up a little bit on the day. those are today's market minutes. caroline: let's get more on the moves bringing in our investment chief global market strategist. is it a dollar story? >> it is more than just a dollar story. it is an intervention from the imf story. e.m. for at least the rest of the month will come under pressure. i expect the fed will hike rates later this month and i think the fed policy has a lot to do with what is going on in em in addition to the countries specific issue invulnerability. joe: what would you look for that would say to you it is time to allocate more money to em
given the risk reward potential? kristina: that is a great question that is hard to answer because i think this pressure could last a significant amount of time. having said that, my expectation is we may see the fed tickets put off of the accelerator after the september meeting. i think that's will give some relief to emerging markets in general. go in andunity is to find that which was painted with the same brush as turkey as argentina and find the opportunities there. joe: to be clear, when taking the foot off of the accelerator, would that be something represented by something where they see that is close to what they see as neutral? kristina: we are hurtling toward that. we have seen participants say they are getting close to a point where policy is no longer accommodating. i'm looking where the feds decide not to raise rates in
december or slow the pace of the balance sheet which i would argue it's more powerful for em. julie: does that then equal the rising tide helping all boats or will we see u.s. stocks resume a strong rally on that as well? one would think that would cause relief. kristina: we could see u.s. stocks, but i think it would be a time where we see money flow outside of the u.s. because what caused a lot of the u.s. stock strength is a relative safety play. we're not risk on or risk off, we are risk aware. that has driven investors to the u.s. for what they believe is harbor safety. if they believe the fed will ease up in terms of the tightening policy, i think that money flows out of the u.s. to a certain extent and moves to em and other parts of the world. caroline: what about the flow to europe?
we have brexit, italy, so there is a concern on that. kristina: what did tates whether or not money flows to europe is where the ecb goes -- what dictates whether or not 20 flows to europe is where the ecb goes. they have been a powerful force. going back to look at the greek debt crisis, systemic stress went up dramatically but came down. ecbink i would look to the to drive whether or not we see slows into europe. people who have diversified portfolios have done really well on their u.s. equity any ofns and nothing in their other positions whether it is em, other non-us developed markets, bond positions, so probably a lot of anxiety. do you go u.s. higher or allocate elsewhere in general from the big picture?
people have got to have pretty unbalanced ways compared to where they start the year. what do you do now? kristina: it depends on when they started. 2017 was a great year for em. i would advise to continue with a plan of broad diversification even though u.s. has been a strong performer as of late because that could change. you need a significant exposure to alternative's and all outside of the u.s. -- and risk outside of the u.s.. caroline: the first eight months of this year have been strong for ipo, will it close out badly? we will tell you -- close-out that way? we will take next. this is bloomberg. ♪
mark: i am mark crumpton with first word news. after two days of a tense atmosphere, brett kavanaugh's confirmation tumbled into highly charged arguments today over whether key documents were being withheld. askdemocrat of new jersey for discipline releasing in email on brett kavanaugh. they said senators can be expelled from office for violating confidentiality rules. >> if what we -- what he said was sincere, there are senate rules governing behavior of senators. if you feels i and my colleagues that were with me have violated those rules, then bring the charges.
go through the senate process to take on somebody you said is unbecoming to become a senator. one senator called senator booker's action irresponsible. four people are dead in cincinnati including the gunman after a shooting at a bank. police say the shooter opened fire at the fifth third bank building. >> we know an individual entered the building and fired inside and proceeded to where he was engaged by several of our officers. there were gunshots exchanged. mark: it's unclear police killed the gunman or if he shot himself. a computer programmer has been charged in connection with the in 2014.ack and sony the justice department's at a north korean man conspired with
others to conduct a series of attacks that still $81 million from a bank in bangladesh. the u.s. believes he was working for a north korean sponsored hacking organization. the attack involved release of personal data, emails, and executive salaries. brazil's presidential candidate was stabbed during a rally this afternoon. his son confirmed on twitter his father was stabbed in the abs but is fine. brazil will hold general he hasns in october and recently begun campaigning with the bullet-proof vest. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. joe: as mark mentioned, the stacking -- stabbing, it appears he is going to be fine.
,e're looking at ew see here the brazil index etf jumping a little after that headline. not something you see typically after a politician gets stabbed. , a lot of people have been anxiously watching this closely. caroline: we will continue to keep an eye on that asset for you. deutsche bank hedge fund clients have had a front-row view of the problems. the lender is gathering some of its most important customers in new york to offer reassurance that it still wants to serve their needs. let's bring in steven arons on the phone. cfo has come to town, what did they want to say to these key hedge fund managers that have been lacking the prime brokerage that they need?
messagei think the key they want to deliver his we are still with you guys. deutsche bank has announced a big restructuring of their bank and that includes big cuts of prime brokerage and they want to say, look, we have cut the people and clarence that's kleins we don't want to work with, but you guys that are here, we still want to do business with you. joe: also clients that are currently with deutsche bank, what are their biggest concerns? steven: are you still with us, are you still here? the new seo announced the withucturing including prime brokerage. many people in the investment bank part of the company have left and many have been fired. others left on their own
fruition. there has also been the fed result the deutsche bank failed and they will have questions around that. on the positive side, deutsche bank casino rating operate. that is something they will like to point to a saying look, we are there for you. joe: there are a lot of questions about deutsche bank's big strategy. some people are wondering if it will one day be a german bank again as opposed to a company trying to be an international investment bank. i guess these hedge fund clients in new york do not want to be with them if they are concerned that one day they will be abandoned and be a domestic player. steven: i think that is correct. there's a sense that deutsche bank is trying with germany to run the bank. the bank said we are basically turning away from it to a certain extent.
that is why they bring out the big guns and the people to the city to tell people yes, that part is over. it was not that big of a turn away. we want to be with you as well. caroline: the big guns and people. thank you steven arons. son billionaire masayoshi is asking banks to open the pocket banks if they want to be part of the biggest ever public offering. softbank is seeking an ipo of its japanese wireless unit and they say they should offer to lend parts of the parent company. let's bring in alex. softbank isith mind-boggling and on a scale like anything in history. what is going on alex: there are a lot of big numbers here -- on? alex: there are a lot of big numbers here. hundredpotentially the
billion dollar vision fund that soft rank as. to put this together, they are trying to line up underwriters for that ideal in tokyo and are saying, look, if you want to have a role on this blockbuster deal which could top alibaba's ipo, you need to lend to other parts of our business unit. this is all according to people familiar, but the discussions include potentially lending division fund or other parts of softbank. it is interesting because you have seen this kind of happened before with snap. they gave a lot of boost to the underwriters when they went public. this is not about the company that is going public. this is them asking to lend to other bits of the company. the collateral is not clear in these loan discussions whether that would be private or public companies. all of the discussions are going
you have to shell out cash over here to get cash from us over here is a very interesting proposition. julie: in the case of snap, you could see why we need a little lever to get credit. why doesn't softbank need -- it is already a huge business. why does it need to offer that? alex: that is the question folks are asking. hundred billion dollar fund and potentially another, why do you need this? it gives additional capital to softbank without having to tap the lps. i know to question folks would have. if i'm in lp, perhaps i'm asking this question as well because if you have access to cash, wire usingu -- why are you not the cash you have access to? because of the sheer size of the ipo, if we could squeeze a little out of the banks if they want in on this big deal, why
don't we. caroline: they have been a huge player in london and they have been a big person at the table for european tech scene. i have my eye on one particular ipo. alex: is that the far-fetched deal? a deal is on the road. they set terms and their raising as much as $638 million. neil is another company coming out ofa asia. it is the competitor to tesla in china. they're looking to raise more than a billion dollars. that is adding to the really intense deal flow and one son -- one i'm certainly looking for is tencent music. tons of deal flows coming to the u.s. julie: it's going to keep you busy.
was 162,000. are we expecting a similar underachievement tomorrow? >> i think so. usually august is a very strange number. it's might be a statistical quirk, who knows, but the august number usually comes in below expectations, below the recent adpd in below the estimation for the month. it doesn't necessarily mean economic momentum is fading. we expect payrolls to continue to bring in 200 k plus readings for the remainder of the year. julie: what about the manufacturing part of the economy? the numbers there have been more positive recently, but the payrolls number not necessarily. does that hint at an increase in manufacturing payroll? there's a lot of concern if you look at different areas for example.
the nonmanufacturing area was another example where people raised concerns about terrorist impact -- tariff impact. i bought a chart showing goods producing payrolls. you can see on the chart the white line is picking up and that is telling us we're not seen much of an impact from tariffs in the goods producing sector including construction and manufacturing. -- forw's for report tomorrow's report, the most important thing is the indication. julie: what about the balance between the two? services by far the larger part of the economy. even if you have goods producing payrolls coming up, it is the services producing payrolls that is the problem. >> we need to continue to see momentum in that aspect as well. the chart showed this has faded
a little bit. i think it is temporary. the economy is growing at a very high growth rate. that should bring in jobs at a decent pace. joe: every month or like five years now we have been getting these are the solid reports on the top line and a solid drop in the on employment rate. the wage growth continues to be mediocre with no particularly expected change in tomorrow's number. do you have a favored theory? and d have any sense of one of my kick into -- do you have any sense of when it might kick into a higher gear? >> the rate of unemployment is way below what the fed and economists estimate. i think another theory that really make sense is that there may be nonmonetary benefits .laying a role here
things i companies providing to employees instead of a pay raise. that is another thing being discussed so we don't see the numbers, but that does not necessarily mean workers are not being compensated. julie: we will continue to not necessarily see it in the number tomorrow? >> it will take some time. we are not seeing a big surgeon earnings numbers this year. we might see one spike, that i don't think it will persuade the fed to start hiking rates faster than they are expecting. julie: get ready for a quirky month in august. thank you, alina. hesitation from institutional investors is weighing on cryptocurrencies. we talked to of geo-exchange about the state of the digital lgo exchange about the
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limited time get 150 dollars off and free shipping too. sale prices are available right now. go to buyleesa.com today. you need this bed. mark: i am mark crumpton with first word news. the trump administration is planning to scrap a long-standing court agreement on how children are treated in immigration custody meaning families will be kept in detention longer. the agreement currently requires the government to release immigrant children after 20 days in detention. the white house says it will adopt regulations that will allow for changes regarding migrants in illegally crossing the u.s., mexico border. the political whodunit is in full swing in washington as politicians and others try to figure out who wrote the anonymous new york times op-ed that rocked the white house. press at separate
conferences, the speaker at the house and minority leader weight in. serves fornistration the president, it is a person living in dishonesty. that does not help the president so if you are not interested in helping the president, you should not work for the president as far as i'm concerned. it's probably hard to figure out to wrote it, the vice president was my first thought. [laughter] pompeo, they denied it was an by process of elimination we will come down to the culprit who has the most knowledge of president in the white house. mark: in a series of tweets today, top administration and cabinet officials denied writing the anonymous op-ed. burt reynolds who starred in films like deliverance and
others is dead at the age of 82. that is according to his agent that said the actor suffered cardiac arrest. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am mark crumpton. this is bloomberg. julie: let's check on after-hours movers. we see activity that is interesting in some quarters. you are looking at the regular session to the left of your screen and after hours to the right. the stock is bouncing around but at the moment was up 3%. one company is starting a film division trying to address the long-term critique in the fact that it has not turned its toy franchises into successful film branches. they hired the producer of the dallas buyers club to head of the division.
one doesn't necessarily think of toys, although, it was a very serious dramatic dome. it is interesting we see -- dramatic film. it's interesting we see this. okta is an internet application software company coming out with numbers that have beat estimates. that is why those shares are higher. five below is sharing higher in the wake of earnings. on the larger side, we have broadcom numbers out as well and that companies adjusted earnings are beating estimates. the shares are up better than 3%. continuing on, some of the other movies we're watching, a fiber-optic company is up 6% and zooming is illustrating higher zoomies -- zumies was trading
higher. be particularly interesting given the bloodbath in semiconductors today to see what followthrough there is tomorrow. joe: "what'd you miss?" a report that goldman sachs may be delaying plans to start a crypto trading desk which might be a possible catalyst for the brutal crypto selloff. it shows how much crypto investors want institutional money to pile into the space. for more on this, let's bring in frederick, the cofounder of lgo exchange, a crypto trading platform. frederick, thank you so much for joining us. what is it that your -- you are building? there are a lot of solutions whether it is the trading desk, decentralizing exchanges, etc. what are you bringing to the page? frederick: the thing is that
when you are institutional investors you have to meet some requirements and plan a platform to trade on the platform to meet these requirements. especially when it comes to transparency, security, and privacy. most of the platforms on the market don't meet these. joe: with the plunge of cryptocurrencies, it is obviously a rough time. one company is laying off at the seven employees. what is it like building something in this environment? i'm sure when you launched it, it was a very different environment. frederick: i've been in the space for six years. joe: so you see lots of crashes. frederick: i've probably seen a crash 50 times during this. when you are considering this market, it's important to not
look at the up-and-down of the past 24 hours, but to remember the whole cryptocurrency and blockchain industry is about solving a real problem we have on information systems. the regulation will not be able to solve the problem by itself. the cryptocurrency and blockchain market is all about solving this problem. caroline: what interests me is it is all about decentralization. we are now seeing people having to move away from decentralization who were completely focused on it. people don't trust facebook because it is centralized. , bornseeing shape shift out of one of the key players back in the day, and he has had to move away from anonymity in because ofading regulation. theey square the fact that
very means of decentralization go out the window and you have to exchange with institutions? square the fact that the very means of decentralization goes out the window and you have to exchange with an to duchenne's -- with institutions? frederick: we need to decentralize the government -- governance of the software. that does not mean everything needs to be decentralized. some parts need to be decentralized because when you want to deal with financial institutions, you need to have a real relation. you cannot decentralized that. i think we will see in the and some things can be completely decentralize like bitcoin. about you have talked seeing the cycles and cryptocurrency. when we were at highs in bitcoin for example, the knock was that
there were not these options available to institutional investors. they wanted to get in but they did not have a reasonable way of doing so. now, there also seems to be a lack of demand because of the decline we see in the price. do you think those institutions will come back again if we see a rebound in price or do you think because of the highly visible crash we have seen that they will be more cautious? frederick: i don't think it's just about the growth or down of the cryptocurrency. it's more about can you connect your existing system to what cryptocurrencies are about. friction tol of buy, trade, everything, you will not do it. funds areand hedge playing with a very small portion of the capital because it is smaller terms of friction in the market. we want to reduce the friction. to deduct, we need to understand how to guarantee that you are
not taking 100% risk. when you are putting your money on the shares currently, you're taking 100% risk. we try to solve that. we want you to put your money on the shares but you have control of the money. caroline: hide used to sing with yourself -- how do you distinction yourself with others? how do you get yourself in front of future clients. frederick: we is the blockchain technology to make sure we bring trade.the people in sometimes having to make adjustments on the platform in real-time, the regulator will be able to verify there's no one teaching on the back form.
when it comes to custody -- cheating on the back form. when it comes to custody, it's a to have really good quality --. we tried to meet this requirement live partnered with tanks would make sure our --ents everything the customer has is their own account. we have big customers and can do that. same thing for cryptocurrency. we design technology with the signature. we take what exists and put that in the crypto space. julie: hopefully we will have you back when there is another bad -- another bounce.
thank you. coming up, the most exclusive boys club in america. money is not enough to join the club of the nfl owners, we hear from the author who spent four years investing in the league in what he calls one of the great untold stories of american business. from new york, this is bloomberg. ♪ bloomberg. ♪
this reaction in his book. >> he is everywhere. colin kaepernick is a problem --y wish he would go away would go away. a lot of people who generally are not great to be brought in public, i.e. nfl owners, will have to testify an answer uncomfortable and pretty privileged questions. they did not want that. i still think they would like to avoid that. i think the president will weigh in at some point if he does not already -- hasn't already. that will take up a lot of the oxygen going into the season when they want to keep the folks focused. >> you talk about support of the kaepernick movement in the league. correct me if i get this wrong that some owners are more sympathetic to players grievances than other people realize. >> i think they are.
nfl ist is that the diverse in the sense that there are thousands of agendas. there are over 30 markets. there are a whole different set of interests. one of the reasons big game was familiar that with me is that i do politics for a living. you realize it is all the same swamp. this town is a swamp. donald trump ran against it. football, everyone is part of the same deal. you have the usual suspects, owners, journalist, and it is a lot of the same stew of humanity. i wanted to dive in. >> did you go into the project looking for parallels or did they find you? >> they found me. i went into this project looking for an escape from politics. i was sick of it. i knew it would be another dispiriting campaign.
i love football and wanted to jump into that for a while. all thate not long at you cannot escape politics by jumping into football. even before trump, the league politics and backbiting, ego, and same thing you see in washington, you see in the nfl. then, colin kaepernick and donald trump come along and politics are unavoidable. >> and it is a smaller group because the membership is exclusive. the nfl kinds -- find itself in these culture wars. you write about how insecure and paranoid the league is and its relevancy. is the nfl set up to handle things in any other way? there is a lot of diversity in terms of different owners with different agendas, but in terms of background among the owners, they're one in the same. >> everything one of them is basically aging white men except for one from pakistan. people who set of
have their fingers on the pulse of the american culture, know, you do not want this. beyond that, this group of nfl owners is a great untold story of american business and culture. ande are 32 people who own are some of the most powerful entertainment executives in our country. the second orbly third biggest entertainment company in our country. in their individual markets, their tight. -- they are tight. they are all billionaires. donald trump desperately wanted in for decades and cannot get in. as a consolation prize, he pointed himself in the white house. he can't be in the club, but he gets to live in their heads. >> and you go about it to ask this question, rhetorical question, about the nfl. you think anyone in the nfl recognize these existential issues at hand? >> i think they recognize it intellectually, but i don't think any of them have a sense
of urgency you would want from a younger, a person who feared the feature -- future. someone accountable to a board that could get rid of him or her in a few years. these nfl owners are like politicians in that they are used to a level of difference and power. the one difference is none of them have to run for reelection. they are installed. you cannot get rid of some of these people. really daniel snyder, he would probably lose by 50 point. >> what would be the tipping point as things deteriorate slowly? >> i think it will happen slowly. concussion is driving sort of a big wedge into who plays football and youth leagues. i think ratings are seeping down. cord cutting is a technical issue. politics is a much bigger factor in football than it was 10 years ago both on the left and right. trump made this a big culture
cause for celebrities on the right. i think the game is great. it is a great to be -- great tv sport. i think it will survive because of the greatness of the game. in spite of many of the people who run it actually. >> which owner is the most understanding of owning -- the most likely to understand the business and see the beauty of the game as you put it. >> some of the most impressive people i met are some of the number twos like jonathan kraft, robert kraft's son. mccabe, tony con, rich these are all much younger -- they have a more holistic and really more activist -- they are people have a sense that have been to business school or have the sensibility. largely, these are not people you want to put on a corporate running apple,re
fedex, bank of america, or something like that. julie: the interview with mark leibovich, author of the big game, the nfl in dangerous times. how market land investments ended up being more trouble than they are worth to the world richest university. that is next. this is bloomberg. ♪ this is bloomberg. ♪
transparency around the rules and there is plenty to be digested. twitter stocks are not reacting after hours. some investments are coming back to bite the world richest university. harvard has invested at least $1 billion in farmland in the last decade according to reports released. some farmers are suing the local companies harvard has invested four controversial land grab. michael mcdonald joins us from boston for the story. michael, talk to us about how this has been brought into the public sphere. this was supposed to be the way harvard was going to get an edge over its rivals like yale. they went into these markets, set up local companies, controlled them and cut out the middleman.
instead of going in with a fund manager with expertise, they went in with their own staff. they bought farms bigger than the state of massachusetts. these places are huge and we are seeing the results of taking these outside risks. now we see disastrous results on their performance from some of the bets they made. that these court cases they have been dragged into and inherited when they went into these markets. they are still fighting them today. joe: the huge university endowments, over the last several years, have put a lot of money into farm land and forest land because they are perceived to be real, uncorrelated assets which huge institutions like. they can produce value enough cycles or down cycles. that only works if you expect positive returns. how specifically do the returns go bad? case, therethis
were expectations built into some of the investments. if you look at the performance of the portfolio, before they made a big change at this particular endowments, they brought in a new team to overhaul the operations. when the new team came in, they found this portfolio, took a hard look at the assets that i wrote about today and said, well, these are not worth what we thought they were worth. these are not performing at the level we thought they were going to be performing and they decided to write them down. after they did the right down, -- write down, i was working with my colleague in brazil and we dug into these investments and found why they were producing such bad performance all of a sudden. this. like a legal battle back to 2004
before harvard are just the company that owns the assets. we found some of the problems that have plagued this portfolio. harvard's billion-dollar farmland fiasco is what reporters are calling it. michael mcdonald, a great writeup, thank you. joe: coming up, what you need to know for tomorrow's trading day. this is bloomberg. ♪
julie: "what'd you miss?" a continuing selloff within technology. we are not over with the tech hearings yesterday. it kept going. don't miss our exclusive interview with alibaba's founder and chairman. think i'lla little the august jobs report is out at 8:30 a.m. tomorrow. caroline: and don't remiss the forum, the gathering of economists and foreign ministers in italy. julie: lucky them. that is all for "what'd you miss?" caroline: "bloomberg technology" is up next. joe: have a great evening. this is bloomberg. ♪ ♪
emily: i am emily chang in san francisco. this is "bloomberg technology." forget the scandals and scrutiny from congress, facebook's shrinking margins are making investors think twice. can they jumpstart earnings as user growth by those? plus, bumble puts women first in the online dating game. the company is turning that attitude to investing. we hear from the ceo on her plans to invest in other women.