officials say shorting the and is doomed to fail. is doomed to fail. follow me on twitter. trading volume of that the lower in china. another look at markets in this .art of the world on there seeing volume shanghai composite down around 6%, nothing like the 15% we had yesterday. a little more calm in the first half hour of trade. index up .9%. seeing quite good support

coming through from the likes of galaxy entertainment. still some weakness though. china resources down on the hang seng index. yesterday, there was only one stock in the black, so at least a little more positivity coming through. yesterday, entered into bear market territory, so coming back off that take selloff. jakarta just coming online and joining the game, up high seven -- .7%. every market is high except japan. the nikkei two to five currently down by 1.8%. 225 currently down by 1.8%. we are watching sharp, rising on reports that it is considering restructuring its lcd operations. #'s that nothing has been decided at this time. says nothing has been

decided at this time. sharp is one of the best performers on the nikkei 225, up almost 1%. is one ofetal mining the worst performers in the region today. airways one of the best performers, up 5%. we are seeing a little more risk appetite today. getting back to the hong kong exchange and how the markets are faring, let's go to heidi. yes, certainly the sense ,f what juliet was saying little more risk on, particularly when it comes to the chinese markets today. this coming on the back of the news flurry this morning out of the pboc.

weittle stronger than what had been expecting, but nothing that would spook investors the way we saw happen last week in that terrible week of trading in. had the pboc conducting regular money operations, quite common to see this ahead of chinese new year when my quiddity becomes quite tight ahead of the seven-day golden -- when liquidity becomes quite tight ahead of the seven-day golden week holiday. the chinese authorities certainly trying to encourage the idea that stabilization is coming to the market and there is no need to panic. that is the rhetoric we have been getting from the pboc as , the chief economist coming out and saying look, it's all a bigeen misunderstanding. it look at this in the context of the u.s. dollar.

while the yuan has been weakening against the dollar, it is stronger against all of its other trading pairs. that was also one of the reasons for the devaluation, to bring it back in line in relation to these other currencies. it's also why we saw the pboc -- bring about it of out a basket of new currency indexes. not a lot of detail had been given of that -- about that. saying yousically need to change your mindset and stability should be maintained for the rn be. to be fair, this would not be the first time outsiders have criticized the pboc, not just for policy missteps, but for communication missteps. joining us at the

hong kong exchange. commodities have not been spared. crude trading a 12 year lows. could they go lower? -- morgannding stanley sure seems to think so. oil continues its very poor start of the year at the moment. wti and brent are both down more than 15% since the start of the year. morgan stanley is considering the possibility of $20 oil. that's not the first time we have heard someone talking about $20 oil. goldman last year said it might fall to $20 a day. they were talking about supply. morgan stanley puts it down to damage being done by the dollar. the first month of 2016 has long been flagged that it's going to be a tough year for oil. thinking about $30 oil, and we are there.

the next wildcard is iran t.tting exports to the marke the first six months, tough. many are thinking about the next six months as being a rebalancing. it looks like it's going to be a long time, a long time before we get there. rishaad: thank you for that. let's take a look at some of the other stories we are covering for you today. quakes hi there. it's the unofficial kickoff of earnings season. all color was the first to step up and they beat for -- alcoa was the first to step up to the plate, and they beat fourth-quarter estimates. profit included one-time items that beat estimates. expect to see record

demand in 2016 and the need for aluminum growth in the auto and airline industries. boeing said its deliveries rose to a record in 2016. trading near six-year lows, separateplanning to itself into two companies to deal with the commodity prices. downick a boot has stepped just a week after the electronics retailer collapsed. shares have not been trading since friday and discount sales during christmas failed to generate enough cash to prop up business, forcing deck smith into administration. refused to honor gift cards sold in recent weeks and investors were given little

warning by management that the company was in peril. dick smith failed just two years after it was evaluated. it has nearly 400 stores across new zealand and employs nearly 3000 people. has posted a surplus for the 17th straight month. one point ¥1 trillion or $9.7 billion. , or $9.7rillion billion. the currency has been able to stay in the black over the past year helped by a weaker yen. we also saw falling energy

prices trim the nations import bill. japan has a deficit larger than billion. about $2.3 exports still struggling to keep up with lingering concerns on emerging nations. there is no place like home for indian oil refineries. tappingycoons are surging demand amid a global supply glut. idea thatals next the the yuan is only heading one way. you are watching trending business. ♪

rishaad: the yuan little

changed. the third day china has done that. they did come out swinging to protect the currency. one pboc economist claims china is weak on a misunderstanding of its policy. what are you making of the noise coming out of the pboc and surrounding the yuan? pboc has beenthe squeezing the liquidity condition to force a long liquidation, to force out some of the speculated positions that have been shorting the market. this has been resulting in a decline. if we look at the basis this , it is now only about 300 points, rather than 100 yesterday.

-- 1000 yesterday. our view is that chinese officials are trying to calm down the market and curb the cnh for the time being. ultimately, what is their goal? >> i don't think they are trying to strengthen the currency artificially or by threat. indeed, chinese officials have been changing the way they manage expectations. in the past, typically a comes into the market directly via onshore or offshore markets, and during those days, typically, conditions would be clear quite rapidly. this time around, it is a different story. is going on? we saw high-volume overnight and record levels yesterday. what did you make of that? thethat all down to activity of the pboc the previous week? >> exactly. of managing

expectations. instead of directly intervening in the currency, what they do is disconnect the cnh and cmy liquidity. they want to keep liquidity flush to support the ongoing slowdown of the economy. on the other hand, they have to squeeze the cnh liquidity condition on the taxpayers in order to make the negative carry higher.t positions instead of directly intervening with the currency in the offshore market, they have to increase the cost. absolutely, and we have some financial institutions in hong kong who can indeed swap currencies, but those swap lines are closed. ,> yes, since last november they have been largely closing the channel to tap onshore liquidity, one by one. they stopped foreign banks from tapping the onshore liquidity market. they also stopped them from from onshoreowing

affiliated banks as well. rishaad: they don't publicize this. >> not really. it's more a window guidance so far. the latest round of liquidity is due to direct intervention by the pboc. when they directly intervene in the market, they will be mopping up liquidity in the cnh market. ultimately, the idea is to bring cnh and cmy together, is it not? >> the market has been looking --this in agency and why on looking at the cnh and cmy on the basis of expectation. the market will continue that trend. with the regulators would like to do for the moment is narrow the basis to increase

expectation in the foreseeable future. what about the banks? how badly are they in need of the yuan funding right now? if we look at slightly longer-term funding, they are in need, but not that bad. banks,r of hong kong especially major banks, have direct access to the liquidity program. called it theust cnh liquidity program. the second is called plp. approach can liquidity. so far, the amount is not very sufficient to deal with conditions. , we see the current levels. rishaad: there could be short covering on top of that. we have a situation where if

this is prolonged, what are the of locations? >> the application is that also growth in the cnh market will further slowdown. -- asset growth in the cnh market will further slowdown. -- weak sinceek august of 2015. this year, if you look at the bond market, outstanding issues will mature before the end of this year. if the primary market does not keep coming, then this market is going to shrink. for the moment, it is most likely to shrink in 2016. areaad: right, but we talking about offshore. we are talking about singapore and london. >> growth in those centers will offer -- also slowdown.

tothe past, no one wanted borrow and appreciating currency at a higher rate. for the moment, the offshore rate is higher than the domestic borrowing costs. the long growth and aunt market growth have slowed down not only bondng kong come -- and market growth have slowed down, not only in hong kong, but in these other markets enters. we could see liquidity increased the -- centers. we could see liquidity increasing. behaad: how should investors taking this? >> they have some liquidity facility. rishaad: they could flood the market if they chose to. >> they could because they do have a swap line with the pboc that is about half of the hong kong deposits at this stage. liquidity fund is supposed to be enough -- getaad: but they have to

the nod from beijing to do that, don't they? rishaad: typically, what we see is a volatile swap line. keepingis an act for liquidity tight, which is what kong mightires, hong not want to activate the $400 billion. rishaad: your skills at diplomacy are fantastic. thank you very much. >> here are the stories making headlines around the world. south korea says it will strike back immediately if attacked by the north. the chairman of the joint chiefs of staff spoke at the air force command. has raised the alert status for forces in the peninsula after the north claimed h-bomb test last week. korea, japan, and the u.s. will discuss the

situation in tokyo on saturday. it has removed the core of its nuclear reactor and filled it with cement. the international atomic energy agency expects to consider -- confirm the news in the next few days. tehran has always denied trying to develop nuclear weapons and says the heavy water was used to create isotope for cancer treatments. sean penn says he has nothing to hide about meeting with el chapo . hisican police claim that interview helped them track guzman down. whose money may now be extradited to the u.s. guzman one --

may now be extradited to the u.s. ♪

we are just getting some details on this situation. $3.5 billion for production of one do. they want to start the ipo process soon. we will monitor that and bring you details as we get them. david bowie was an enormously creative force in music and fashion. he also brought innovation to business itself. first artist to bet on future royalties.

>> david bowie is one of the most influential musicians of the last 30 or 40 years. he appeared in movies. he managed to take a lot of different sounds and use them in his music. he clearly was an omnivore and someone who continues to have an effect today. you can see just by the response to his passing. from a business perspective, he created this idea of a celebrity bond market, where he sold securities tied to the future performance of his royalties. he leveraged his popularity and people's belief that he would sell music in the future to raise money in the short term. something replicated by people like james brown and iron maiden. the question is whether those celebrity bonds will be as popular for musicians now, given the way the music industry has shifted. when cds were90's flying off shelves, it would

seem a safe bet that royalty -- royalties would keep flowing in. as the music business has contracted in the past 15 years, i wonder if you could get the same money selling a bond based on future royalties or if you would have to give people a piece of your touring money. yvonne is having a look at the social media reaction to the death of this icon. an inspiration. a lot of shock over his staff death. he kept his diagnosis -- over his death. he kept his diagnosis a secret. fans were shocked, many not believing it. this was two days after his 69th birthday. his last album was just released on friday. you could see some clues in the lyrics of his new songs that

were hinting that he was dying and wanted to leave a parting gift for his fans. one of his lyrics, look up or, i'm in heaven. -- up here, i'm in heaven. -- fan said paul mccartney, a close friend of bowie's left this message -- so, i think a lot of musicians today saying that his morphing personae really inspired them. madonna, lady gaga, those performers were inspired by the legend. madonna called him talented and unique. he was known as a songwriter, but his songs were about being an outsider, an alien, a misfit. there really was no one quite

like him. rishaad: thank you for that. up, oil, predicting more pain ahead. we will go to kuala lumpur and get the details on that after this very short break. ♪

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rishaad: mixed picture on the asia-pacific market. shares in shanghai are up. shares overshadowing losses when it comes to mining companies. oil holding losses near 12 year lows. expansion in u.s. crude supplies.

rose by 2ckpiles million barrels last week. down.ushed crude some are predicting $20 a barrel. china coming out swinging in defense of the yuan, saying the -- fall of a large call in the currency are ridiculous. meanwhile, the pboc economist say that this is based on global currency moves. let's get straight to market action. what a short relief rally that was. we are seeing stocks in the region down for a seventh consecutive session. no winners so far as we continue to hold at these levels for the regional benchmark. a pretty solid start to china yesterday.s

but we have seen a switch into the red. kong looking a little better. the hang seng up by .4% in the first part of trading. you can see the winners have not changed that much. galaxy entertainment fell. philippines a standout today, up by 1.8 percent. entering into bear market territory yesterday. a little bit of a pickup on the itspi, but-- really is japan leading things lower. the worst of performers. we are continuing to see a switch out of quite a lot of those mining players. the had a solid start to session, but is paring back with those losses we have seen.

it's worth looking at the airlineg asia-pacific index. it is quite high. we are seeing a lot of support coming through. china is in a little bit of trouble. doesower crude oil price help the airlines out. profit margins become a little more profitable. this is what we have been seeing on the shanghai composite, down by .3%. we have seen it break through the 3000 level. the low, 2990 today. volatile trading once again. at 12d: crude trading year lows. one oil company says it does not see a recovery for another few years.

petronas saying oil prices could average $30 a barrel this year. how would that affect not just company, but malaysia itself? >> oil prices are coming down approaching $30 a barrel. it's not going to be over soon. we are trying to improve procurement practices, but it still remains for the long haul that there may be some tough years ahead. cutting back on capital spending as a consequence of all this? that's normally the response. cuthat they plan to do is on operating expenditures. as much as $80 billion over the next five years. they are saying that the

industry as a whole will have trouble meeting demand when the global economy recovers and the market picks up again. when does petronas expect a recovery in prices to actually take place then? >> not for the next two to three years at least. when may be sometimes prices go up again, but it may be 3, 5, 7 years for a full recovery. they have to wait a bit longer for that. 4 thank you very -- rishaad: thank you very much. a look at sharp share price today. take a look at that. some wild gyrations with this equity. we have reports it is government a bailout. multiple parties are involved in discussions, but no decisions

have been made yet. let's get over to bloomberg asia and the managing editor. peter, what's going on? peter: the company is finally talking about about the potential restructuring in the media reports at there. they are not saying a lot so far. the company is saying they are not the source of the media reports. they are not giving them this information, which is sort of boilerplate. what they are saying is that they are in talks with multiple companies about turnaround plans. this has become one of their most valuable businesses. smartake glass panels for phones and tablets, including for apple. theaad: how bad is situation at sharp? what are people telling you? somee company needs financial support.

they are talking with at least two different parties about a possible restructuring. they are talking to in j, which is a government led fund that has supported other japanese companies that have gotten in trouble and needed financial support as they restructure. they are also talking to foxconn, the tie when he's company that supplies apple. foxconn -- taiwanese company that supplies apple. years they said for would like to acquire sharp. it would probably mean radical restructuring. restructuring would probably be more gentle. the fund tends to be more protective of japanese jobs. that would probably be an easier path for sharp. not surprisingly, sharp is leaning toward the easier path in this situation. when we actually get a

formal announced that of the plants -- formal announcement of the plans? peter: we are not sure. we are told they both have a long way to go to hammer out some sort of agreement. one of the big hurdles is that inc. j also owns a big stake in japan display, which is the other big lcd maker in japan, and so there would be some antitrust concerns. but they do need to get the talks going. there is debt coming due in march and they could use financial support when that comes around. rishaad: thank you. we are going to check in on some of the other stories we are following. son -- samsung has missed earnings but one person says it could rise by more than 40% this year.

snapchat starting to rival facebook for daily video views despite enjoying only a fraction of the viewers -- ewers. -- users. had 8 billionit daily video views and 1.5 billion users. s.a.p. says it has doubled the number of uses of its software in the quarter. news today in aviation right here in the asia-pacific. is talking to vietnamese airlines later this year. the enemieser -- takingater this

over vietnam means airlines later this year. how significant is this? is one of the world's fastest-growing aviation markets. the airports here are full of passengers in the know i and ho chi minh city. with --orts are packed annoi and ho chi minh city. they are seeing double growth every year. 49% of these passengers flew last year. it's a growth story. why is this japanese interested in vietnam in particular? john: it views it as part of its

growth strategy in asia. something like one in five vietnamese in a country of 90 million are flying today. within two decades, virtually -- all enemies will be vietnamese will be taking to the air. for vietnam airlines, tying up an elite carrier will not only give it a larger market but help the airline increase its standards. it had a goal to become a four-star, five-star carrier in the future, and it is facing very tough competition from vietjet, which could overtake vietnam airlines as the leading domestic market carrier. t aream airlines and vietje

fromg the newest aircraft airbus and boeing. it seems like it's a very symbiotic relationship for both. is it because it is a low base that we are seeing it grow so rapidly? few: certainly relatively vietnamese are flying, but when you fly around vietnam today, packed, frome economy to business class. capacity is increasing every year. the economy is growing. you also have a situation where the ground transportation infrastructure isn't very good. it's difficult to travel long distances in vietnam by vehicle. kind of efficient time.

the railways here are not fast. in a way, the only option many if they want to get somewhere in a decent amount of time is to take to the air. while vietnam airlines was initially looking for a 20% stake from a strategic partner, the ceo of vietnam airlines told ana has takentake could expand later on. taking theming up, lead. we will be talking to obama and head ofclinton's innovation. ♪

rishaad: a look at stories from around the world. the red cross says aid tracks have entered three besieged syrian towns where residents are starving to death. images of malnourished people have been drawing attention in recent days. the border has been under siege by forces loyal to president bashar al-assad. aid has also reached to shia towns controlled by anti-al-assad rebels. messi has been named the world's best football player again. rinaldo had won it for the last two years. up every 70l or so minutes. is up fory mansion sale for $200 million.

the property includes a 29 room home at with wine cellar, theater, gym, and zoo license. as well as this infamous grotto. hugh hafner bought the mansion over $1for just million. robotics, internet cyber security, and big data are becoming increasingly important influences on business in the 21st century. a key role ined president obama's tech and innovation strategy and was one of hillary clinton's top advisers. he spoke to our very own stephen engle. much. thanks so we have five minutes to predict the future of the world. we are going to get right to it with alec ross, the author of thebook "the industries of

future." i have a seven-year-old daughter. what should i be teaching her other than manners? >> languages. foreign languages and computer code. and not just code for the sake of knowing how to code. if you think about what some of the industries of the future are, one that sticks out to me are genomics. we are going to be programming with our genetic material the we program our computers today. >> are we going to be able to solve cancer? and david bowie live to 120? >> we are going to be able to solve cancer. a way thatwe have doesn't eliminate cancer but can find it and treated a lot sooner.

>> how about robotics? artificial intelligence. you are 44. i am 49. are we going to see androids walking on the streets with us in our lifetimes? of the movies and cartoons of the 1970's are the reality of the 20 20's. there are two reasons. one is cloud robotics. you don't have to have a $3 million robot to do incredibly sophisticated things. the second is modeling belief space. things that used to be very difficult for robots, like grasping, because it was very difficult to model done.atically, now can be >> digital currency is something dear to the bloomberg universe. how do we get beyond the cash in our pockets to a secure digital currency future? >> this is interesting. let's talk about bitcoin, for example. i think about bitcoin as a search engine from the 1990's.

altavista, like a, all who faded to near nothing, but the category of search endured. there is a thing called the block chain. it's a computer science breakthrough that came from bitcoin. i think part of what it's going 99.99% of trust in electronic commerce. i think there are going to be big developments in the next two or three years. developments in big data. >> land was the rom interior of the agricultural age. iron was the material up -- raw material of the agricultural age. was the material of the industrial age. data is going to be the material of the next age. we are still on course to artificial intelligence. was interesting, here we are, january of 2016, and their --

what is interesting, here we are, january of 2016, and there are 16 billion connected devices in the world. that number is going to go to 40 billion. put moore's law on top of it. we are creating a pacific ocean's worth of data and analytics. predict theile to industries that will be driving the global economy in 20 or 30 years from now? 20 or 30 years ago, we didn't know the internet would be so entwined in our lives. >> predictions are really hard, especially when they are at the future -- about the future. i graduated from college, i wish someone had written a book about what the internet could be. when i predict the next 20 years, i will be right about some and wrong about some, but i

do think we need to future cast a little bit so that we can prepare our kids. industries do we think our children will be in? one.think genomics is the next trillion dollar industry will be created out of our genetic code. i would also flag ciber. cyber security. we had a pretty good 20 year run of the internet being relatively open and not having to think about security overtime. i have a feeling we now have to think about security in ways we haven't before. the weaponization of code is the most significant development since the weaponization of material. the difference is that with nuclear weapons, you have to have access to the scarcest of scarce elements.

with ciber, any hacker can do bad. >> a la grasse. all right, that wraps up our day -- day two coverage. why does india expect energy consumption to surge? ♪

are watching the world's diesel supplies. india's refinery tycoons are betting on a jump in consumption.

bloomberg has been tracking all of this from the indian capital. good day. most -- is one of the largest crude importers in the world. almost 77 percent of crude oil requirements are imported. any movement in the price of crude oil impacts the country. will give the government room to continue unwinding subsidies in the sector. predicts like sra oil a rapid recent domestic will continue. indian purchases are emerging as a bright spot and providing the --ions refiners with what is with a light in what is being seen as a darkening outlook.

expected the push will continue as far as 2016. the company has spent a massive amount on expansion plans. in an upturn, which will help the company maximize its profits. india has been one of the worst impacted as far as crude oil prices go. rishaad: thanks very much indeed for that. let's have a look at some of the markets. let's have a look at what's going on. a positive start turned negative indeed. the shanghai composite up by .6%. moderateseng up by a .25%. closed out its session up by just over 2%.

weaker.i remains a tad stay tuned. angie is going to join me to recap the big stories of the day, including the swinging mood and asian markets. ♪

♪ >> from our studios in new york city, this is "charlie rose." charlie: in nine months, the country will elect the 45th president of the united states. national security is dominating the campaign in a way we have seldom seen. many challenges are bound to face the president's successor. mike morel has served as cia's deputy and acting director. he has served several presidential and vice president candidates. he has written a fascinating new book called "the great war of our time." i am pleased to have him back at this table. welcome. mike: always great to be here. charlie: let me just talk about january 2017.