tv Bloomberg Best Bloomberg December 6, 2019 10:00pm-11:00pm EST
♪ up, the stories that shaped the week in business around the world. trade and tariffs dominate the conversation. overere has been whiplash the past week or so over where these topics stand. >> we are coming down >> the short strokes. >>saudi aramco moves ahead with a blockbuster listing. >> the world's most valuable player. nejra: opec plans their next step. >> we should preventively lower production. nejra: u.s. payroll, a big week for economic data.
>> it is now heading in the right direction. >> expect incoming tweets. preparing for the next downturn. >> we are more cautious today than we were in 2009. nejra: elizabeth warren explains how she thinks about u.s. trade policy. >> i want to see a coherent plan for anyone who wants access to american markets. nejra: it's all straight ahead on bloomberg best. ♪ nejra: hello and welcome. this is bloomberg best, your weekly review of the most important business news and interviews from bloomberg television. let us start with a day by day look at the top headlines. china's economy showing signs of stress from the trade war.
first told of a positive story. -- new numbers told of a positive story. >> hope over the country's recovery. roseweek's official pmi for the first time since april. what do these numbers mean? squad?e swallow make a >> it is a positive headline, no doubt about it. both the official and private sector are headed in the right direction. the reason for pause is seasonal affect behind that. he holiday shopping season. has we saw in china pmi spilled over to the rest of the region, giving a bump to the pmi's in south korea and japan. it is a positive. we are not yet seeing any signs of a sustained rebound.
>> encouraging numbers out of china. a short time ago, ifn numbers from the united states that with the other way. south of 50 and going in the wrong direction. >> that is right. disappointment in the numbers pointing to a deterioration in conditions. what this number underscores is that even if we do get that u.s. china trade truce, the problems in the u.s. manufacturing sector are not going to be easy to fix. they will not go away quickly. >> donald trump is reinstating tariffs on steel and aluminum from argentina and rigell -- brazil. we're hearing from wilbur ross that the president will increase tariffs on china if washington and beijing don't reach a trade agreement. >> it is a nervous moment. adding tariffs on steel and aluminum. it's a reminder that this is their favorite trade policy tool.
they love to use tariffs to get what they want. drop for the s&p 500. record highs throughout last week. stocks are down but bonds are not up. >> i know. it is not fair. you are supposed to have your bonds to hedge out your stocks. the 10 year had been higher earlier. it stayed higher all day. stocks have been running up so fast. trade jitters. it makes it more interesting. ♪ making a comeback. hitting argentina and brazil with steel levies and a threat to slap tariffs on $2.4 billion in french good. -- goods. 12 days before the white house his china with another round of trade penalties. wilbur ross saying if nothing
happens between now and then, the president has made clear that he will put the tariffs and. the president telling reporters in london that you will have to wait longer for a deal. >> in some ways, i like the idea of waiting until after the election for the china deal. tweet.s pull a big we -- china will release an unreliable entity list which includes relevant u.s. entities but it's not just china in the u.s. crosshairs. ,et's not forget about italy turkey, argentina, australia cut -- austria, france. >> france said, we will tax big tech companies because we think that these companies are not paying enough taxes here. tax ongoing to put this these. you see several other countries follow. the u.s. said, this is it fair.
we will tax sparkling wine, makeup, cheese, quintessentially french products. index is down on the day for the s&p 500. it is the third loss in a row. 1%.y 7/10 of the dow moving exactly 1%. >> it's a risk off mood today. 0.6%. we are 2% off of the highs here. gettinget is basically a little nervous but still pricing in the fact that this is a poker move and there is bluffing going on on both sides. ♪ relations between washington and beijing are likely to see further strain after u.s. lawmakers passed a bill that could sanction chinese officials for human rights abuses against muslim minorities. it threatens to throw already tenuous trade talks into disarray. >> it damages the mood music we heard from the global times that
china is thinking of putting restrictions on u.s. officials for visas and travel. china is speeding up this unreliable entities list, that can include u.s. companies being sanctioned including fedex. >> despite the rhetoric, risk assets rebounding. the u.s. and china are moving closer to a phase one deal. >> there has been whiplash over the past week about where exactly these talks end. expectations are still said that talks are progressing and the negotiators will be able to get a deal to presented trump -- present to trump. it has yet to be seen. that is the goal as we speak. ♪ $25.6di aramco raised billion in the world's largest ipo, relying heavily on local investors. the company at
$1.7 trillion. somewhat below the kingdom's original target. did the ipo beat expectations? >> in the immediate term, they did. they priced at the high end of a very narrow range, 32 greenhouse per se or -- reality per share. immediately jumping ahead of apple and microsoft does the world's most valuable company. billion, the5.6 largest ipo, surpassing alibaba in 2014. it is a small success for the kingdom. it is the first step in the plan to diversify the saudi economy away from oil. ♪ >> let's get the latest on opec. after six hours of talks, ministers left the headquarters before a final agreement was nailed down. saudi arabia's energy minister left a promise of beautiful
news. might is it so hard to come up with a decision today? >> the contentious issue seems to be, is it just codifying what has artie happen in the market? are we going to use the october 2018 baseline? there was hubris overnight that it might be a real cut. that doesn't seem to be the case. there has been a stony silence on this red carpet. not one of them would stopped it -- stop to talk to us. >> saudi arabia surprise the oil market by promising significant production cuts beyond what was agreed with fellow opec members. >> the market requires it. it would be additional stuffing in the first quarter. the best thing to do is preemptively lower our production. >> is why we saw prices really pop. many people thought this entire cut was going to because metta. this was well choreographed. it was a little bit of naming
and shaming when the press conference happened. nigeria and the iraqi oil minister both joined. that have never happened. -has never happened. the discussions here were serious. ♪ >> u.s. investors focusing on the latest jobs report. >> a very strong report. expect incoming tweets. 266,000 jobs created in november. the unemployment rate falls back to 3.5%. earnings up to tenths on the month. that is enough to push the annual rate up to 3.1%. not only was november strong, , a total and october of 41,000 additional jobs. the key point is, america is working. america is working. despite whatever cynicism or criticism, the fact is, the jobs numbers are getting better. >> october 11, the president
said we have come to a deal subject to getting it written. that was eight weeks ago. what has the president seen? what has been agreed? >> the final strokes are not there. we are coming down to stroke -- short strokes. we are moving forward nicely. i have learned never to forecast the outcome. ultimately, it is president trump will make the final call. >> as we close out the week, it started off on a down note. there was all this talk about how the president was in no rush to sign a deal. out in the second half of this week. the s&p 500 closes out the week with a gain. ♪ ahead, democratic presidential candidate elizabeth warren takes donald trump to task on trade. an exclusive interview with brookfield ceo.
anniversary. issues discussed ranged from arms control to china. what a turnaround from president trump who went from criticizing u.s. wasaying that the prepared to walk out to now defending nato, saying it's an organization that has worked well. >> it is reminiscent of having family over for christmas. nobody gets on. there's an argument. in the end, you are family. despitehat we got to those open disagreements about the future of nato. the nato statement itself was pretty benign. , thetted to a road forward value of the alliance, for all the members. nothing like the discord we thought would come from the meeting. ♪ >> angela merkel's government has been thrown into crisis. her coalition partners elected new leaders who are demanding a shift to the left.
how much at risk is the grand coalition after these developments? >> one could say that the future is somewhat uncertain. this new leadership, they haven't openly come out to say they want to get out. that they are somewhat divided on this question. they are pragmatists. they would probably want to say -- they but his running mate is a very ideologue. she really thinks that this has brought the spd down. she thinks the government has been too conservative on a lot of issues. she would like to go out. internalo see how this dynamic among the leadership is going to develop over the next few weeks. ♪ >> japanese prime minister shinzo a abe is rolling out a massive stimulus package.
battling an export slump, natural disasters, and follow-up from a sales tax hike. what do we see under the hood? >> the figure is $240 billion. wow. that is a large number. that is $26 trillion. that is the headline figure. we have to dig deep down to trillionigure of $7.6 in direct central government spending. that is going to be the punch that comes into the economy. our economist here at bloomberg 0.4%ts the economy to grow in 2020. that is a result of these measures. the government says they will to 1.4 percentage points growth. economists are skeptical about that. they think it is not going to be quite as effective as that. ♪ >> hong kong's secretary is
painting a bleak picture for the city economy, forecasting the first deficit in 15 years. >> this is a government and economy that has been answer plus for a long time, a large surplus. now, some meat on the bones of problems here. reiterating again that this economy is going to fall into recession for the full year, contracting 1.3%. >> hong kong retail sales plunging 24%. the ongoing unrest is hitting the economy. the weekend saw a return to protests, please firing tear gas. >> we know that tourism and retail spending has been getting hit by the protests. by china's own slowdown as well. on the political side in terms of protesters, no sign of a circuit breaker. look for hong kong's economy to be pretty bleak at the moment.
♪ >> we turn now to india. the central bank to fight all forecasts and left rates unchanged. gdp data showing a sharp slowdown. why did they choose not to cut rates? >> they offered a weak rationale in our view for keeping rates on hold. potentially said that it wanted to follow a wait and watch approach to see the inflation trajectory. at the same time, they have bynwardly revised projection a massive 190 basis points since the august review. despite such a sharp downward revision, it chose to pause on interest rates. ♪ >> the federal reserve is acknowledging the year and demand for cash and boosting the size of its repo action. it attracted more than $42
billion of bids. ce?t is the significan >> they realize there will be a cash crunch at the end of the year, as there tends to be. what they are trying to do is make sure that they are prepared as much as possible to see that the volatility that we saw last year at the end of the year is not replicated. ♪ satisfying its hunger for energy. wille natural gas pipeline connect beijing to the world's largest exporter of natural gas. how much of a game changer is this? said, russia is the world's biggest exporter of natural gas. most of its sales go to europe through pipelines. that has been politically problematic as they try to expand that. thatallows them to bypass whole mess and find a new market in asia and monetize new fields
that are too far east to connect to their european system. they are not stopping here. they are already talking to china about expanding the steel. they have talked to places like south korea about possibly doing , pipeline through north korea if the two countries could agree to that. this is opening a fool -- a new branch of the world to europe -- russian gas. says the house will draft articles of impeachment against president inmp for abusing his office a profound violation of the public trust. inthe president has engaged abuses of power, jeopardizing the integrity of our elections. >> how many articles will be drafted, what will they say? what will it mean for senators who will have to be sitting in order for this process to take place? >> it's a great question. we are looking at three or four articles of impeachment.
power,g on abuse of bribery, and attraction of congress. we don't know how long the process will take. of thends on the quality defense the president percent. if he calls witnesses and fully participates in the progress that process, it could take longer. -- in the process, it could take longer. it is a consideration for the five senators seeking a democratic nomination. they will be stuck in washington with they would rather be on the campaign tara -- trail for 2020. ♪
u.s. senator and democratic presidential candidate elizabeth warren is drafting an antitrust bill that would call on regulators to retroactively review two decades of megamergers and ban such deals going forward. checking the power of monopolies is a plank in her campaign platform. we interviewed her in new york on wednesday on the topic of trade. she had blunt words for president trump. ♪ plan. president has no >> you have a plan for everything. what is the elizabeth warren plan? >> part of it is to say, we need an overall strategy on terrorists. how are we thinking about it? trade is about tariffs. it's the 21st century. trade is about regulation. what i want to see is a coherent plan for anybody who wants access to american markets. i want to ease up so that our
farmers are not being squeezed like crazy like they are now. then, have artie lost markets that will be hard for them to regain. other part of it that i think is important, we need to be working with our allies. we want to have a trade deal with china that is favorable to the west. let's not declare a trade war at the same time on canada, on our other asian allies, on our european allies. let's get everybody to work together on this to try to get china to follow a reasonable set of rules entree. >> if china is hoping to wait out the trump administration for a warrant administration, you wouldn't be willing to lift the tariffs on day one. >> we can't keep doing this as one offs. we need a coherent strategy that works with our allies and makes clear where our long-term interests lie in trade. i want to see trade occur.
i want to see trade occur in a way that is helpful to the american worker, the american consumer. i want to see what donald trump is doing. he is destroying markets in value around the world. >> would you china chinese human rights abuses to a trade deal? >> again, working with our allies, we should be putting a lot of pressure on china. part of that pressure should be diplomatic. part should be economic. we need to use all the tools in the toolbox. ♪ nejra: that was democratic presidential hopeful elizabeth warren. michael bloomberg is the founder and majority owner of bloomberg lp, the parent company of bloomberg news. coming up, much more compelling conversation. feel ceo says he doesn't see a recession around the corner but that doesn't mean there are no risks. nato's secretary-general takes issue with emmanuel macron's
♪ nejra: this is bloomberg best. gathering of nato leaders outside of london came in the wake of fractured comments by key members. emmanuel macron recently called the alliance brain-dead. for some time, donald trump has charged that many countries don't pay enough towards defense. and spoke the summit with several attendees about these internal differences. starting with nato's secretary-general. ♪ >> i welcome the fact that president trump became a strong supporter to nato. he recognized that european allies are now stepping up in
regards to burdens sharing. allies and european canada have added 130 billion euros to the defense budget. this is unprecedented. this is making middle stronger. -- nato stronger. it is having an impact. >> going back to the brain dead comments, i know the language was too much. you were with emmanuel macron last week. what do you think he's trying to achieve? is this a wake-up call or is something else happening? >> i don't agree with that way of characterizing nato. especially because what i have seen over the last years, nato was doing more than they have done for decades. we have implemented the largest reinforcement of our alliances since the end of the cold war.
troops for the first time in our history. we can easily move and reinforce if needed. increased defense spending by european allies. addressing new challenges like the rise of china which was not on the native agenda before but is now. cyberspace, and disruptive technologies. nato was agile, active every day. that proves that we are responding to the threats and challenges. ♪ , we have togree spend more. we cannot have the american side of nato be 50% of nato's economy. and the of nato european side is only spending 25% loss we handle the other 50% of nato. he's right.
pledge was that we would move closer to 2% step-by-step before 2024. when you look at the numbers on, 130 billion extra spent the non-us side of nato. that's an incredible number. >> you commit to that figure? trump would say the netherlands is a rich country. >> we are. he is right. we are spending billions more per year, 10 billion on new defense equipment. billions more in terms of our of defenseense spending. we have to keep track of the size of the economy. thatim is to achieve wealth target in 2024. nejra: not to a special series on bloomberg television, ceo spotlight. we sat down with the qualcomm
chief executive. they discussed the particular challenges of guiding a company with global reach. ♪ is spreadloyee base around the world. what we had to do 15 years ago was, the complexity of the product grew so much. it was so impossible to make it in any one site. the traditional approach is, i will take this product in this place. you can draw all these boundaries around what a site does. we can't do that. ,he product is so complex thousands of people work on one of these products. you are forced to create the product, to have every site talk to each other. what we have done is take somebody who is very strong culturally and we will have them as the lead of the site. we will have a mirror on the other side that talks to them every day. it is old, ground game.
call the person, communicate with them. we have solved that problem a decade ago. >> it feels like your business comes down to being personal and having a personal level of communication. do you think that is common in science space businesses? is it something that the outside doesn't understand? that is true. noteneral, it is communication as, i know everything and i will communicate to people. it is, you have a collective brain. figure out culturally how to pull from the collective brain. be humble enough to change her mind. you can find much more of that exclusive conversation at bloomberg.com. now to another exclusive ceo interview. head of canada's alternative asset manager,
brookfield asset management. he's preparing for the next downturn but we are not quite there yet. ♪ >> we don't see anything in the current economic environment that troubles us that there will be something happening tomorrow morning. having said that, we are close to 11 years into this economic cycle. i don't think economic cycles have been repealed. there will be a recession in the developed markets at some point in time. some countries are headed there today. particularly in europe. because of that, we have very high stock markets. there will be disruption in credit markets in stock markets. our view is, when you are in an that is more robust than you might otherwise have, you should be careful. dry powder in
funds, more cash on our balance see -- she. our balance sheets are more financed long-term. getting ready for the point where we can capitalize on situations if the markets turn. if they don't, we will be fine. we will keep investing. we are more cautious today than we were in 2009, for example. there are some places in the world today that are like 2009 in the united states. for example, india. financial crisis situation going on which is similar to what happened in the united states in 2009. the banks are not in great shape. nonbank financials are in trouble. what that means is that entrepreneurs don't have access to capital. they are selling assets. we have been buying a number of things in india lately. >> you talked about china.
one third of your assets would be in china. i wonder whether there's an thete on that, based on context of politics of human rights, of china's place in the world. does that factor in? is it more straight up? >> first, we said asia, not china. that includes india in our mind. china, specifically with look, going back to what we do as opposed to what others do. we go to a country, we move money in, we buying an asset, we redevelop it, we either own it or sell it to somebody else. it is not strategic to anyone. things don't move across borders other than money. it is not really relevant to anyone. china has an enormous population building out.
nejra: this is bloomberg best. let's resume our roundup of the week's top stories with a focus on company news. it was a busy week of comings and goings for executives around the world including an unexpected change in google and alphabet. ♪ >> google founders stepping down from their roles at alphabet. will alsoogle ceo become the ceo of alphabet. how surprised are we by this?
>> we are a little surprised. we are as surprised as we were four years ago when they announced alphabet. it was like, this was obvious. he was effectively the manager of all of google. you could make the same argument now. he's on the board of alphabet. google,n involved with 99% of the revenue of the bet. -- alphabet. gavemer googler says it corporate structure to reality. >> citibank is welcoming a new leader. you don't envy someone like him, coming into the sector at a time like this. >> he has a tough road ahead of him. the flipside, he is a new broom. he is not mired in the same scandals as the other bank
executives. it will be a very tough job for him. public trust, political trust in the sector is pretty much at an all-time low. i feel like i keep saying that every time. . new scandal will come along he has this long road ahead of him. at the same time, he has to keep investors happy. earnings are under pressure at all of the australian banks. they will have to do something to turn that around. ♪ >> another ceo out the door. executiver's co-chief is stepping down next quarter after eight 10 year at the firm. five people have held the title. >> irene has been there since 2014. she shared the title was dave mccormack for the past 2.5 years. he will remain as ceo as the company. it was a remarkable scoop.
eileen murray was considered to be the wells fargo ceo at one point. this woman has a lot of options moving forward. ♪ >> the new ceo of nissan beginning his first week at the wheel. he faces a number of challenges. what can we expect to hear from him? >> we can expect that his main goal will be to set out a plan and to calm concerns about leadership at the top of this company which is under pressure from all sorts of different directions. they have are ready set out a plan that includes job cuts. he has a reputation as being a very calm, thoughtful leader. not someone as flashy as ghosn. he came in and made big changes and it worked. there was some risk involved in that. this is a signal that they are not looking at taking big risks. they want a more contemplative type of leadership, perhaps.
someone who is not necessarily going to make big waves but is going to restore confidence. that is really what this carmaker needs to do. ♪ theefeated underestimate value of its business? that's the claim from italian tax authorities. they are presenting a hefty bill related to its 2014 restructuring following the purchase of the final part of chrysler. fiat?oes it mean for >> they are claiming that they undervalued their supplies unit by $5 billion in 2014 when it merged with chrysler. they moved the headquarters away from italy for the first time, to the netherlands and london. tax itto pay a 27% exit it means fee it could be asked to pay as much as $145 billion in extra taxes. fiat is denying any sort of
miscalculation and saying that they don't expect this to have a material impact on them because they have so many losses in the country. they can offset the eventual payment by credit that they have with ♪ taxes. ♪ >> unicredit has announced a big revamp. they have unveiled plans to launch a 2 billion share buyback. that will take place in 2023. 8000eo has also announced job cuts, 9% of the workforce. what do you think the market will make of these two banner headlines? >> certainly, the plans got plenty of sweeteners in it. they are giving investors reasons to stick with the bank. the payoff is going to increase in 2023. it really depends on whether they consider this generous or
maybe short of expectations. show that they are still in repair mode. cutting costs and bad loans. that is still a work in progress. it should be realized that you have to spend money to save money. actually paying for the job cuts will be a big expense over the next two years. ♪ scam holdings considering major job cuts. more than 40% of the workforce could be eliminated as the ceo seeks to restore profitability. they have been rattled by investor defections. his 40 enough to keep them solvent? >> the company has been trying to find its way for a while. they had a scandal 18 months ago that led to the loss of one of the biggest funds. 40% afterwards of the key moneymaking assets. what are story says today is that costs will be reduced by about 40% as well under one scenario.
if that will be enough, time will tell. the key question is, what will happen to the assets? will they go up or down or flatline? it will be enough if assets stay the same for now. ♪ >> let's get back to that glencore story. down by 9% through the close. the world's biggest commodities --der is now investigating being investigated for bribery. joins the doj and various other countries around the world investigating this company. i think that is the real story. this is one more investigation piling up on the company. onis just adding pressure management. it does reinforce the story that this is a really difficult company for someone to say, i want to invest here. there's a big question as to what will happen. will they pay a penalty? outhere news going to come
to show wrongdoing? we don't know at this stage. anyone would look at this as a high risk investment. ♪ >> the u.s. is stepping up its efforts against wall way. washington has credited guess created a new agency to help businesses purchase telecommunication equipment from other firms. how is this going to be set up? >> it's called the dfc. it replaces some other similar u.s. agencies. one of the key things is it has this $60 billion investment cap. for, it was less than 30 billion. it will be set up looking outward from the u.s. to developing nations which cover half the globe. this entity will be able to provide loans or loan guarantees our political risk insurance.
even now, take minority equity stakes in companies. there is a very large tech focus to this. the agency isn't waiting around. it has yet to be officially cleared by congress. that will happen soon. it is going straight into the debate over five g and huawei. ♪ >> americans spent $69 billion over the four-day weekend, driving sales up. the star day of that weekend was black friday. was there any doubt that numbers would not rise? it rises every year. >> analysts predicted a strong black friday given other consumer trends like wage growth and low unemployment. increasingly, people are going to online sales on black friday, not reserving that for cyber monday. >> people still go to stores for
functions on the bloomberg. we enjoy showing you are favorites on bloomberg television. maybe they will become your favorites. here's another function you will find useful. q uic go. you can get information -- important context and fast insight. here's a quick take from this week. ♪ jinpingse president xi calls of the project of the century. china's sprawling belt and road initiative. sometimes called the new silk road. dollars, ittoday's has artie cost more than the u.s. marshall plan that rebuilds world -- europe after world war ii. world bank estimates that $575 been in the works. signedure's -- nations bills of interest. it is one of the most ambitious infrastructure projects in human history. ♪
project areor the astronomical. spending willy, total $1.3 trillion by 2027, and for china's global image on the world stage. >> china would like to make a deal more than i would. >> president donald trump skills back u.s. involvement. xi is positioning himself as a champion of global cooperation and free trade. the project is not without its critics. there are accusations that china is lowering porter countries into debt traps with some countries even downsizing or canceling projects even as new deals are being signed. several countries have had to rethink their involvement after popular backlash or change of government. sri lanka borrowed $8 billion to build a new port, could not repay the loans, and gave a
state-owned chinese company a 99 year lease in exchange for debt relief. the port has little business now but provides china a strategic birth along key shipping lanes. originally -- >> china would like to get -- >> the trump administration has sought to capitalize on doubt. mike pence telling southeast asia nations the u.s. would not offer a one-way road. criticism, of president xi is calling the project a row for peace. the initiative extended into south america, the caribbean, and the arctic. in 2019, italy was the first group of seven nation to sign-up, brushing off warnings from european allies. in asia, these are the countries that approve of the belt and road project.
these are cautious and these are opposed. overall, the world bank says the revised silk road has the potential to stimulate economic growth. with that growth come challenges. some of the risks include allegations of corruption like those the kurdistan prime minister is facing and potential environmental damage. xi is dealing with china's own debt problem and slowing economic growth. he has promised debt relief to some african nations. a top chinese regulator called for greater responsibility in overseas investments. that is the kind of sensitivity china will need to show if it is to win over its skeptics. ♪ nejra: that was one of the many quick takes you can find on the bloomberg. you can find them at bloomberg.com along with all the latest business news and analysis.
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