district. 10 were killed, eight of them german. the state has seen an insurgency by kurdish militants. in the u.s., president obama delivers his final state of the union tonight. is expected -- he is excited to lay out a broad vision for america's future. you can watch the speech right here on bloomberg. the house has secured enough votes to go ahead with sanctions on companies that do business with north korea to punish the country for its latest nuclear test. california said notable to volkswagen's plan to recall engines from 2009 to 2015. picked aommittee proposal by oakland and san

diego to move a team to l.a. the raiders and chargers agreed to share a stadium in carson. ♪ emily: i am emily chang, and this is "bloomberg west." spending spree. chinese company break out the checkbook, snapping up a major movie studio and dating app. twitter ups periscope. we can watch live videos inside actual tweets. i sit down with ceo kayvon beykpour. tify gives users the stories

behind songs. chinese companies are continuing a wave of m and a. nlun bought a stake in studios.d legendary two separate companies are bidding for ge's home appliance unit? what is behind the merger mania? joining me now, jeff mccracken and brian buckwalter -- buchwald. diego, paul kedrosky, contributing editor. welcome back. jeff, i will start with you. what is driving all this? >> it is not just about china. it is about the united states.

japanese companies want to buy more assets in the united states. so do companies in europe. it is not going through the roof. it is 2%, 2.5%. it is still the largest economy in the world. still pretty good compared to the rest of the world. this is a desire to have more exposure to the united states. right now, it is chinese. a month from now, we might be talking about japanese companies buying assets in the united states. this has been going on for a couple years. emily: let's talk about what is going on in china domestically. does the domestic slowdown meeting we will see fewer of the deals down the line? >> i do not think so. i actually think we are going to see more. it is a broader phenomenon than access to the u.s. market weiss.

-- marketplace. this is patriot nation of the yuan. the same phenomenon is driving up year-over-year real estate in vancouver. data last week, 26%. there with london in terms of price appreciation. we are seeing the same phenomenon with respect to chinese currency finding new homes where they can translate the currency into something that feels like a harder asset. 20 years ago, it might have been the japanese. how much does prestige play into these kind of deals? >> a good question. let's separate the two. the question of a film studio, ogul that does not

own their own film company? prestige was a part in regards to legendary. that thento the fact chinese digital media market is becoming hotter and hotter, more and more competitive. the value of those assets is actually decreasing. we continue to see appreciation in the states. likeially for an app grindr. emily: what about time warner? would that be a target for the chinese? >> i guess it could be. that is a ridiculously big deal. bid,meone in china made a you would see rupert murdoch show up and make a second run at time warner. he would have to do it in a friendlier way than perceived in 2014.

chinese companies have to be careful. if they tried to buy energy assets or something in the structure, if you will, the government will get involved. oosy.have to be ch emily: buying the studio, there's concerns about censorship, content problems. app, whichdating would not have been acceptable a decade ago in china. aboutt shows you less than thechinese mores abject panic about the currency flow. i have to buy something. it has to be relatively liquid. it cannot have regulatory issues. here comes your list of candidates. right at the top is a bunch of unicorns and other things, tech companies with high valuations.

companies like grindr and others. i would not be surprised to see more stakes in larger, expensive technology companies. emily: would you agree with that as someone who understands how chinese cultural attitudes have shifted over the years? >> it is an interesting question about a gay dating app. how open could that have been 10 years ago? in china, it is more permissive underneath artificial layers. gayink there is a lively scene in shanghai and beijing, just less obvious. it has more to do with chinese investors looking for a safer haven in the dollar, in u.s. assets, at this point. emily: jeff, what is the next target? >> you mentioned ge.

that will be a three plus billion dollar deal. that is probably the next deal to happen. i would keep an eye out for jack ma and alibaba. ofy have been in and out hollywood, so i would not be surprised if something comes from that. emily: i asked jack about that in beijing. he said he did not try to buy a studio. now we are seeing legendary letting go. >> they like taking stakes in companies where they buy the whole thing. that would not surprise me, a 30% stake in something down the road. emily: jeff, brian, thank you both. paul, you are sticking with me. gainstocks staged a late with the nasdaq snapping and a day losing streak. julie has a rap. the leaderaq was through up session, staging an

early rebound and continuing the leadership as the day went on. if you look at the nasdaq on an intraday basis, it was a rocky session. a lot of volatility as investors watched oil. performing well, apple coming back. -- bank of america and piper jaffray saying it is a good buy. microsoft and google contribute into games. performer wase also one of the top performers in the nasdaq, and information consulting company. it reaffirmed its forecast following flooding, saying it would not affect numbers.

back to you. emily: julie hyman in new york. anotherp, spotify adds layer to the listening experience with the help of a startup and eminem. lifeeriscope stream new into your twitter feed? ♪

emily:emily: in today's version of out of this world, spacex hoping for repeat success after a successful landing of an orbital rocket back on earth in december. willmusk says spacex attempt another landing on sunday, this time on a barge in

the middle of the ocean. has unsuccessfully attempted this kind of landing three times before. it is arguably more challenging a land attempt because it is a moving target. the company websites at the attempt would be like trying to balance a rubber broomstick on your hand in the middle of a storm. elon musk is out with comments on apple, saying, "bring it on." secret they are developing a rival electric vehicle. apple as ae sees player that will expand the industry. apple has not said they are working on such a vehicle just yet. afterl be back with more this break to talk about the state of the union. ♪

emily: genius is an annotation

startup backed by andreessen horowitz and marshall mathers, eminem. it is known for breakdown of rap lyrics but is moving to other genres. change the it will user experience in a fundamental way. here to discuss, tom lehman and the head of consumer products. i am definitely someone who here's a song and has no idea about the song. what do you think is the point? what are you hoping users will take away from this? >> what you brought up is what it all comes down to. andare listening to a song ask yourself, what does that mean? you think to yourself,

what went down in the studio the day it was recorded? these are the questions that drove us to create genius. is partnership with spotify about putting the answers at your fingertips whenever and wherever you listen to music. emily: how do people use their phones when listening to music? are they looking at their phones when the spotify is on? >> this is our first chance to experiment with that. fundamental goal is to deepen the relationship with artists and fans. one way to do that is bring a little more soul behind the song. we are hoping people engage a little more. it seems like spotify is trying to create a viewing experience. are you? saying weooted in have a lot of context around music that fans love. if we can bring that to life,

sometimes it will be about leaning in and reading, which is what genius represents. the playlist has not evolved in a long time. we are excited about looking at the format and seeing what kind of engagement we can layer on. emily: what further potential bc from the steel -- this deal? >> one thing that excites me is the artist component. you cannot truly understand what is going on in a song without hearing it from the artist. it is exciting to watch artists like diplo and pusha t. my hope is that this becomes a core part of how artists express themselves. if you are listening on spotify and want to get another expression of that artist personality, you need to leave spotify and go to instagram or somewhere else. wouldn't it be cool if you could get that experience where you listen to music? shiva, do you see it

becoming a core part of spotify? >> we have to go where the music fans want us to. if they are excited about learning more, we have to give that to them. we have to see success and engagement and expand it. are really excited about it. emily: tom, i want to talk about genius's integration with the white house, of all things. you will be annotating president obama's state of the union address. what will we be able to see? >> the white house collaboration shares a lot with our collaboration with spotify. jason goldberg, chief digital officer of the white house, talked about what he is excited about with the genius partnership, which is meeting people where they are. it is meeting people on spotify or as they experience

union- the state of the or whether it is people who disagree with the speech or mentioning the speech coming together and discussing it as it is happening. emily: you might have president obama's former speechwriter on their, joe biden. but members of the public -- how contentlan to curate and make sure it is a polite experience? >> that is a great question and a big part of the genius magic. town of experience doing this from a community perspective in music, in rap. there are crazy debate in that world as well. resolving flame wars is something we have figured out how to do, and we are excited to apply these techniques to the arena of politics. emily: you can check it out tonight. president obama delivering the state of the union for the first

time ever annotated on genius. shiva.ou, tom and politics and technology, with the iowa primaries only a couple weeks away, presidential hopefuls are beefing up presence on social media, but what is the return on investment? sprinkler helps politicians manage their strategy. paul, candidates are leveraging digital platforms more than ever. donald trump has the most likes on facebook. ben carson, not far behind. they have twice as many as hillary clinton. , it feels like kids on your front lawn. you want to shout at them, get the hell off my lawn.

i was looking at some of the numbers this morning. it is remarkable. ad spending is up 20% since 2012. that is nothing like online. 5000%2008, it has gone up from $2 million to $1 billion. it is surprising it is only 10% spending is digital. emily: hillary uses snapchat. carson are big on facebook. which candidate gets the best grade? >> they are all trying. a lot of it is still going through traditional media, which

is strange for me. what the politicians can learn from large brands is that the world is radically different. for the first time, we have the opportunity to really engage with people on a one-on-one basis. the most important part about what you just asked, emily, is that the candidates need to go to where the people are. you do not get to select the channel you are using. folks are selecting the channels you are going to be on. emily: that said, you have to allocate your time, your money. which of these services has the best return on investment? >> they all offer very different things. we know that snapchat was launched by the white house last week. there is the big event happening tonight. if you go to snapchat, you get a real behind-the-scenes. i think it is event-driven.

it depends on what you are going after and what channel you end up selecting. emily: do eyeballs translate into votes and action? paul kedrosky, maybe you like donald trump on facebook, but will you actually vote for him to be president? >> just try to stop me. [laughter] trump is a great example of someone who has mailed using social media to promote his campaign. it is like a magazine comments section come to life, just shouting at you from twitter. it works perfectly for the brevity of the type of messages he is trying to get across. it works really well. it does support his message. people are repeating the things he is saying endlessly. 139 characters are

viral almost instantly. it is working flawlessly for him. trump,carlos, beyond does social media action translate into votes? what are you finding? >> if you take a look at the previous election, social media had a very big impact on president obama getting elected into the white house. in the last four years, technology has evolved immensely. the ability to engage one on one with people that you want to engage with is really very doable. a i am really surprised that most hundred percent of this band is not going to digital. you can get much better return and see your spend translating

in engagement, which would logically translate into votes. will be thely, 2016 year of what when it comes to politics? >> shouting. it is the year of twitter. mp is the core of the tru phenomenon. maybe they will get bought by china. emily: carlos dominguez from sprinkler, thank you for joining us. tune in to the state of the union address tonight on bloomberg television. coming up, the pinch for real estate here in san francisco could be impacting our gdp. we will explain. ♪ we live in a pick and choose world.

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so your sleep goes from good to great to wow! only at a sleep number store... find the lowest prices of the season, going on now. save $600 on the #1 rated i8 bed. know better sleep with sleep number. emily: i am emily chang and this is "bloomberg west." let's -- sources say that the

pboc repeatedly bought the currency in hong kong on tuesday causing a record surge in the money market rates to better bearish investors. let's follow earlier investors by senior officials to talk up the currency. up 7/10 of 1% versus the dollar at one point. its longest winning streak since march. they are not concerned about the market turmoil in china. it has expansion plans and will add 500 new stores by september. starbucks says it has up and hurt by the yen volatility, and is expecting a jump in sales. pther companies including sa and others have expressed optimism about growth in china. independente an committee to inspect facilities after scores of workers fell ill

at semiconductor factories. i have been the victim of rare cancers. they agree to monitor and report on working conditions. fund at samsung to compensate work -- sick employees. the issue dragged to the courts for years before samsung abruptly apologize last may. and they will step up the fight against car sharing apps. the ceo downplayed the influence that uber and lyft may had -- have. nissan said they will not facilitate the trend. ceo's you rarely hear publicly say they are not embracing innovation. how does he plan to fight back? yvonne: he says it will get personal, at least with the cars. he says he will not facilitate this car sharing app trend. instead he will push for more

connected vehicles that drivers can personalize. they will make the more sexy, more attractive, and see how people will react. he big knowledges that over and lift will continue to grow, but when it comes to the future he a substantial portion of cars that will globally continue this trend. what he thinks is the next big thing is the connectivity of cars. if you can personalize it to look more like your office or your room you will not what to share it. emily: maybe they both can be the next two big things. thank you so much for the update. san francisco office rents are the most expensive in the united states. it is not just commercial space

hitting all-time highs, demand for housing continues to outpace supply. that limited supply can be impacting gdp, of all things, here in the noted states. one report -- in the unites states. one report estimates that limiting housing and separatist go, san jose, and new york would lift gdp 9.5%. in new york, justin fox. you just wrote an interesting piece about this issue. you lay out a remarkable argument. briefly lay out the argument for us. >> the argument is when you bring smart people together, you get more innovation and more economic growth. the idea is that if new york, san jose, and san francisco could grow faster and at even more tech workers, we would get cooler innovation and more economic growth. emily: colin, this is an issue

that -- from an anecdotal perspective, anyone in san francisco looking to buy a house or office space -- it is a huge problem. it is hard to find anything affordable. what do you make of the argument? >> he has a point because san francisco has traditionally been a supply constrained market and has been tech driven in terms of real estate. the tech industry has phenomenally grown over five years and we have seen 50,000 jobs created. there are not enough jobs to satisfy that demand. and rent in the office market has doubled. you are seeing similar trends in the rental and purchase markets as well. emily: justin, i wonder if reports like yours will push the people of san francisco and other cities to be more open to this kind of development. >> i would doubt it, initially. in san francisco

care what some guy lives in new york about what -- about how big they should be. the issue is more that, as a country we used to embrace growth. when a country had opportunities like this, they would jump at it. starting in the 70's, we switched to this more slow growth, zoning oriented, careful way of growing. cities like san francisco, new york, los angeles. we might have pushed that too far. there is a huge opportunity in san francisco. colin has a new report that shows while the tech industry is mostly based in silicon valley, the newer tech companies are increasingly looking to locate and san francisco. there is this opportunity to become a global epicenter. it is clear a lot of people in separate cisco are uncomfortable with that. emily: talk to us about -- in san francisco are uncomfortable with that. emily: talk to me about what you are seeing. basedstartup wants to be

in san francisco, it seems. >> it is a very hospitable environment for tech companies. emily: except it is extensive. >> a lot of people want to live appear and work in the city. it is a vibrant environment. there is a number of firms who nre here that create an innovation hub. wonder, if the bubble bursts. the regulations make for a softer -- do regulations make for a softer landing? >> the regulations limit the amount of supply that can be built. i am not sure that constraining supply will soften the landing. it could have the opposite thect where it is causing market to rise much faster in cost than it needs to. it is supply we are able to adequately respond to the demand. emily: what about the argument that perhaps these regulations or protections are here for a

reason? >> they are here for the reason to protect operative value for people already there. to a certain extent, to protect people there and renting -- who are protected by rent control from getting pushed out. i don't think in general, they overbilled, we have a bust. then what happens? they have affordable real estate. it is not a bad thing. emily: colin, your research shows no sign of a slowdown. ?ith the prices keep going up >> without see any major slowdown in the next two years. we don't see a large amount of supply change the supply-demand balance. have an thing that will impact on the market will be some sort of external thing -- that will affect capital and these tech companies growth. emily: what will happen after two years? >> after two years we expect some sort of cyclical slowdown.

emily: 25% of office space is filled with tech tenants. that is two times the.com boom -- the dot come boom. >> it is alarming from the perspective that if the tech industry becomes the industry that continues to grow quicker, we become less diversified. there are certain growing pains as we discussed with that that there isn't enough space to house their businesses or for people who want to live in this city. emily: how do you see this argument playing out? a lot of folks have blamed this on the simple physical imitations of san francisco or new york. san francisco has weather on

three sides. but if it were as dense as brooklyn it would have twice as many people. area in the the bay 60's and 70's. in those days, the bay area was a place you can because it was really lovely and your career was not your primary emphasis in life. what's happened is the bay area has become this global center of technology. it is really having this identity crisis. pleasant place to settle down or is it global economic capital? >> we continue to watch it layout. thank you so much. 10.et windows is seeking a residential upgrade. the microsoft ceo is listing his home. it has florida -- floor to ceiling windows.

panoramic views of lake washington, mount olympus, and the seattle skyline. according to records he bought the house two decades ago for $1.835 million. coming up, why you will see a lot more periscope videos directly in your twitter feed.

emily: the decline of the pc continues. worldwide pc shipments fell more than 8% in the third quarter to fewer than 300 million. that is a low not seen since 2008. this number has declined every year since 2011. on -- held they help

onto their lead of 20% -- periscope is streaming new life into your twitter feed. twitter users will now be able to post and view periscope feeds directly from the mainstream. previously you could only see a link to your periscope feed. acquired periscope last year, launching it in march. it has already attracted 10 million active users and hosted more than one million fewer guests. earlier i sat down with the ceo of periscope for an exclusive interview, which we also periscope. i asked why it took so long for the platforms to merge. >> when we first cited talking about twitter last year we got on the whiteboard and said, what can we do together that we could not do a part? apart? this was one of the biggest ideas. the reason it took so long was, we were focused on a lot of other things.

getting periscope to a place where it was fundamentally at its core ready to be built into another product. and in taking and shipping it into twitter. this was no trivial task. emily: talk to me about the technical undertaking. >> we had to rebuild the framework. establishing the connection, putting everyone in a chat room -- we had to cordon all that off into a framework. men we shipped that framework -- then we shipped that framework to a third-party app, which happened to be twitter. the process of separating all of that into a framework, and shipping it to twitter was the basis of that work. know he personally convinced you to come to twitter. what is it like having him as a boss? >> it is interesting to work for a company where the founder is the ceo. jack has a personal understanding.

to have someone with that experience, wisdom, and passion at the helm is not just amazing to be around, but important for the company. emily: twitter user growth is challenged. the stock is at an all-time low. do you ever think we could be bigger if we were not tied to twitter? >> i think the opposite. i think we are bigger because we are tied to twitter. this lunch is a testament to that -- launch is a testament to that. we are giving greater access to other people, and broadcasters. we are allowing them to have a broader audience. orders of magnitude more people that use twitter then periscope. is way people use twitter true to our mission of seeing the world in real time, and seeing what is happening. it is important that when emily not only, she's

sending personal notifications to people with periscope, but hundreds of thousands who follow you on twitter. emily: maybe in order of magnitude less, i appreciate that. how do you see yourself integrating with moments? >> there are a lot of ways now that periscope renders in twitter. if you are on your timeline you see it. if you look at emily chang's profile, you see native periscopes. moments is another one that is important. what more important thing that a moment, looking at a breaking news event, than seeing a periscope live. emily: what kind of content is getting the most engagement? that is a broad question. >> the answer is broad. we have incredible diversity of usage. jimmy fox at the golden globes -- jamie foxx at the golden globes by the scenes, running into johnny depp and jake

yllenhal. you don't see that elsewhere. it is -- there are important subject for the world to hear about. comedians,cians,, actors connecting with their fans. it is really broad. emily: we are about to hear president obama's last state of the union address. what kind of action are you expecting? >> i hope that one day at the white house uses periscope. emily: locking up to the podium with periscope live. >> i wonder if they even let him have an iphone, but that will be the day. with politics in general, the behind-the-scenes stuff is amazing. to see political candidates using it themselves has been great. one of my credit -- favorite broadcasts was kevin nealon

doing live commentary of the debate. consider hearing the politicians speak, you were seeing kevin commentary. commentate.lon it engages more people than would have otherwise been interested before. emily: kayvon beykpour. the ceo of periscope. thanks to the 3000 viewers who tuned in to watch the sneak preview. i got all of your comments and ask them some of your questions. -- asked him some of your questions. ♪

emily: now for the second part of my review with arris group ceo -- periscope ceo kayvon beykpour. >> we are not used to politicians being real. i would like to see carly, or hillary, or whomever on the car on the way to the event saying

this is the most stressful day. i think it is that genuine interaction that periscope can allow for. emily: you were apple's app of the year. what is the big milestone in 2016? the year of what? >> you will see a lot from us. you will see us invest more in content discovery. it was just announced this morning that we had 100 million broadcast on periscope. we are proud of that number, but that is a lot. when you have that content, it is important for content discovery to the fluid and powerful. you will see more from us in terms of letting you discover content that is interesting, that you are likely to want to watch. we want to give broadcasters more creative tools. more integration with twitter. emily: how much are you focused on periscope's monetization?

is it going to happen through twitter and promoted tweets? periscopes that you can see within twitter? >> right now the focus is building a product that people love to use. it has been serving us well, because we have been enjoying this explosive growth. we know that if we do it well, we have built a product that people love to use, we can make that into a sustainable business. right now, the focus is making people love periscope. whether that be through integration with twitter, or investing in periscope real estate itself. emily: the hearts and comments will live on. cool,ve feedback is super but can be problematic. harassment is a problem. as a woman on periscope and twitter, i have experience that problem. what are your plans to deal with that? >> we have learned a lot.

harassment and trolling is a problem on the internet, and it is important on live video to make sure that is addressed and handled with care. releases, upcoming the biggest aspect is improved tools around moderation. emily: how do you do that? >> i am excited, because what we have implemented in the upcoming release is a clever way of relying on algorithmic intelligence, which is important but not infallible. you cannot perfectly predict whether people are being abusive or not, but the commendation of algorithms and -- a combination of leveraging algorithms in the community. and you can create transparency. you can say, this person was marked as being abusive and they will not be able to comment anymore. the tribe has spoken. emily: you might ban people from

commentate? -- commenting? >> there are a variety of implications depending how severe the crime is. there is a gradient. we will conviction, work on solving this problem. there is no one that is a silver bullet, but you will see a series of improvements to direct the problem. emily: on twitter, questions. any plans for a web interface? or desktop users? >> periscope is possible on the web, but the springboard is that you see of tweet with a link, it goes there. we are excited about doing more beyond that with web. and this twitter integration -- there will be upcoming wedding to gratian and elders -- upcoming web integration, and other integration. emily: any plans to integrate

with iot devices like drones and cameras? >> we are excited about this space. no specific lands now. emily: i would love to stream my kids soccer game from my camera to his grandparents, or something. >> apple tv was our first foray. i don't know if you use the app, but we are proud of that. we are looking for other things we can do with other cameras. emily: how about working with vina? e? you could save small clips from or archive something permanently? >> archiving permanently is something we have thought about. we have seen broadcasts that deserve to live on. whether the refugee crisis, -- we think broadcasters should have the choice to keep content around.

emily: so you are going to allow it? >> we have not announced the availability yet, but we would want able to have the choice. emily: you heard it here first. the ability to save your periscope coming soon. out, i want to leave you of a glimpse of what your instagram might look like if you posted a video with 8 million followers. ceo -- that is all today from san francisco. ♪

>> good evening, i am matthew dowd sitting in for charlie rose who is on assignment. president obama will deliver his final state of the union on tuesday. he is expected to touch on three themes, the economy, and civic participation. his chief of staff said it would provide a contrast of what he called the doom and gloom of the leading contenders in the republican presidential race. the gop