♪ nejra: coming up on "bloomberg best," the stories that shaped the week in business around the world. a terror attack devastates brussels. we examined the global impact on sty, politics, and markets. >> clearly it is in our business interests that borders remain open. >> the cooperation between european countries has to be strengthened. >> people should not overreact to this. nejra: a big week in tech as iphone goes small while twitter celebrates a big anniversary. bloomberg covers it all, from apple to xiaomi. >> it was a profitable company for a long time. nejra: and in the week's best

interviews, influential people speak on topics of critical importance. >> you would rule out the possibility of using nuclear weapons against isis? donald trump: i am never going to rule anything out. nejra: it is all straight ahead on "bloomberg best." ♪ nejra: hello and welcome. i am nejra cehic. this is "bloomberg best." a weekly review of the most important business news, analysis, and interviews from bloomberg television around the world. in retrospect, this week has been dominated by tuesday's tragic terror attacks in brussels. but on monday, attention was focused on silicon valley and a major product announcement from apple. emily: apple unveiling a new iphone called the se at its event in cupertino. the latest model has a smaller screen and a smaller price tag, starting at $399 for the cheapest new iphone ever. what are your big takeaways? cory: i think it's just interesting. i was making an analogy with the golden state warriors.

how rather than go big or go home, the old traditional basketball adage, they found that small ball works well for them and they won a world championship doing that. you can see apple tried the same strategy. apple is finding ways to go small. they are playing off advantages that got like 30 million people last year and that was a shocking number. 30 million people bought an iphone 5 last year. they have dedicated users who want to use smaller phones and want to pay less for it. >> they should take away that they are being slightly more aggressive, maybe appropriately aggressive, with a price that should be more in line with emerging markets. this is a great price point because it is going to be more attractive, but at the same time, it is not going to be at the cost of their margins. >> once again, europe wakes up to the threat of terrorism, once again in belgium, and we have to try and understand the scope of what we understand are probably coordinated attacks and how big this network is. tom: you really wonder how they will adapt, how europe will adjust. two now london to paris and now

brussels. >> this certainly seems like a coordinated attack. it certainly appears to be in response to the apprehension on friday of the main living suspect in the paris attacks last november. of course, you know the belgian government has been under continual criticism since november, in terms of its terror, anti-terror campaign. why did it take four months to apprehend abdeslam? it seems like he was here if not in molenbeek, at least in the greater brussels area for that time. they did get him on friday. they thought they had made a major breakthrough in the terror campaign, and this seems to be a big setback that we have today with these multiple explosions. scarlet: belgium is on the highest terror alert level after three bombings in brussels today. at least 31 people are dead, more than 180 are injured. the city is at a standstill as police search for more bombs.

>> this is where many of the 31 people were killed in the two attacks that took place in brussels today. we had one attack here at the subway station, which, to put things into context for you geographically, we are right in the heart of the european union, the european commission. i'm actually right now surrounded by buildings that belong to the european commission. if you think about it, this is really the first large-scale terrorist attack, the largest terrorist attack that has taken place in this country since the second world war, and at least one of the attacks happening right in the middle of the e.u., the european commission's headquarters. >> credit suisse is accelerating its restructuring. the bank has announced it could cost savings of $1.7 billion since 2016, costing an additional 2000 jobs. credit suisse is one of a number of banks struggling to boost profits. >> back in october, credit suisse said we have to kind of triage what we are going to

tackle here and we need to improve our macro business first. credit is doing ok, but then the fourth quarter came, credit fell off the cliff. that continued in the first quarter. they had losses on distressed assets. now they are saying this is moving up the priority list. francine: you said you were surprised by your illiquid positions. tidjane: yes. francine: when did you find out about them? tidjane: in january. francine: why was this not clear before? tidjane: as i said on the record, this was not clear to me and to many people inside. that is where we need real cultural change. it's completely unacceptable. there have been some consequences around that. francine: are the people trying to withhold information or was it just -- tidjane: it is a very interesting question. it is linked to a cost problem. if your costs are too high and you are not taking them down, you will lead a river in your strategy. a lot of the problems with investment bankers is that people try to generate revenue at all costs, if i may say so.

it was a high-yielding book, and generating a lot of revenue. so people were reluctant to reduce it because it would expose the cost problems. rishaad: chinese premier, looking to asia to be the growth engine of the world, calling asia the growth engine of the world. he had a lot to say. steve england is at the forum, and he really, really kept banging on about growth, didn't he, steve? steve: the outcome looking from -- the outlook coming from the chinese leaders tends to be a little more sunny than in previous months. they are seeing signs of stability. that is the point that he made to the delegates in the forum in asia. mostly it is a chinese conference, but it is intended to kind of be china's version of the world economic forum for asia. ok, and he kept on hammering the

point that they are seeing stability. the quality of economic growth, according to him, is improving. he emphasized that china has enough tools to ensure "stable economic growth," and he is confident that china can maintain that pace of growth, 6.5%, over the next five years. he says, in his estimation, the fiscal deficit is not too high. he also said on the yuan, they will not devalue the yuan to boost exports. and on the property market, he said we want to avoid major fluctuations in the property market. he is aiming for steady development. nejra: coming up on "bloomberg best," a close-up and comprehensive look at the impact of tuesday's terror attacks in brussels. ♪

♪ nejra: welcome back to

"bloomberg best." i am nejra cehic. the investigation into tuesday's terrorist attacks in brussels continues. go to bloomberg.com for the latest details and analysis. throughout the week, bloomberg television tracks the impact of the bombing on global markets and gathers insight from experts around the world. let's look back at the best of that coverage. francine: when we first heard about a possible explosion, futures did not do much. and then we saw a clear but shy risk-off mood. are people now dealing with this kind of thing in their stride? are we mispricing terror risk? themos: it is one of the hardest risks to price. typically the short economic impact tends to be quite visible. the economics of things always point to the fact that economies tend to survive these things. markets don't tend to price a persistent long-term impact. however, near-term you do see flows and price actions, such as

the one we are seeing at the moment. stephanie: as we look back, whether we are talking san bernardino, paris, or 9/11, the markets have taken a leg down following attacks, but we have also seen a very strong rebound. we are asking, is this time different? themos: the market that seems to be reacting most is what we will call the brexit trade. the weakening of the pound, the widening of the bund, the sterling, too. that is because we have an election coming june 23, whether or not they stay in the euro. now you have political sides that can take advantage of this. if this happened a year ago, there isn't any political opposition that could take advantage of this. but now, not only do you have it in the united states, but you also because of brexit you have it in europe, too. they will take advantage of this, and that is why you see more of the political trade having a bigger move than the standard playbook, how do i play a terrorist trade? >> the markets are usually or have been at least in the past

two years or so pretty resilient to these terrorists. david: that is the right thing to do and it also turns out to be the more profitable thing to do. we should not be terrorized. the actions of a few sociopaths, it is horrible and we have a member of my team in brussels -- he is fine -- but at the same time, the reality is it does not change the overall movement of the global economy. it does not change the outlook for profits or interest rates. so people should not overreact to this. >> borders will be strengthened initially. the topic of schengen will come up again. as a businessman that operates within the european union, how important is schengen as an agreement and as a pillar of the e.u.? do you consider it under threat, and what does that mean for business europe-wide? david: as a european and also u.s. media company, we operate in many european countries.

and clearly, it is in our business interests that the border remains open and free trade continues. and is applied to all of the businesses i know. clearly, our objective has got to be that despite everything and despite concerns about security, borders remain open and people continue to travel and trade continues to flow. stephanie: does an attack like this or in paris get those governments around europe to point fingers or to try to act more in a unified way? thomas: i very much hope to see the latter. we have seen a real weakness of europe in the last weeks and months. in particular, with regard to the euro crisis and the refugee crisis. i very much hope that this is one positive thing that will come out of what is happened in brussels, that this will lead to a more unified approach combating terrorism. >> i do not think this has significant implications for

europe's policies in the middle east, which of course is the reason why we are having so many of these problems, nor do i think it has an impact on a divisive u.s. presidential election in the states. emily: you do not think it is? >> i do not. no, i don't. we have already had these two major paris attacks. we have had a number of major terrorist attacks in turkey. we had the german assault, and now we have brussels. i think by next week, frankly, i would be surprised if in the united states, this is the kind of headline that we are still actively talking about. i think we are increasingly getting inured to this kind of violence in europe. god forbid we have an attack like this in the u.s. it would be very different and would have a political impact. certainly a number of the political candidates, trump included, are going to try to to make a little bit of hay on top of these headlines, but i do not think it will be significant for

the u.s. presidential election. no, i do not. >> there are statements from leaders all around the world, including from president obama in havana, about a response to this terrorism. what do you think government needs to do in order to defend our allies against attacks like this? >> i think we have to identify with what has happened to the europeans because it has happened in this city before. god forbid if it could happen again. the terrorist group islamic state is a threat both to the u.s. and canada as well as to all the europeans. what it means is, we have got to rally around them. so judicial cooperation, law enforcement cooperation, and making sure that our intelligence agencies are working together, that is the best way probably in a situation like europe, where you have homegrown terrorists in the city of brussels, in the suburbs of paris, the best way to help europeans. alix: pound falling today, posting its biggest decline in major currencies, all of that on speculations that the brussels explosions will boost the case for a brexit, the result of

closing more borders, curbing immigration, all of that fear potentially permeating what we might see in the june referendum. >> indeed it feels like a repetition of that particular occurrence. we had the bombings, the tragic events in paris that led to an increase in support for the out vote. in the brexit, if you look at the polls, we did see a swing in favor of the leave vote. in the subsequent months. that was reflected in a sustained selloff in the pound, against the euro. the repetition of that seems likely in the near term. that said, some of the negatives are already in the price, so if anything, unless we see a very significant swing in the polls, the pound downside from current levels did not exceed what we have seen so long ago. >> lots of people talking about the future of schengen and the political pressure that some of europe's leaders are under. how do we see the euro trade and

what does this tell us about how people are perceiving the euro, a safe place to put money in the euro? >> what we saw yesterday was the euro not performing well at all. you can explain that by saying that concerns about schengen and the e.u. have been going on for a little while. they have been going on for a little while, perhaps this brings it to a head. i think positioning explains why the euro did not perform well. if we go back to about a year ago, when the euro started to perform well when we had risk off events, that confused the market at the time, but we must remember that if we go back to the start of last year, the market was very, very, very short in the euro. and i think what we've had is a big correction in positions since then. and now the market, i think, it has recovered to more normal levels, meaning that the euro is more vulnerable on bad news. >> it's not quite the safe haven

play it was a few years ago. >> i think it is very difficult to say that euro is a safe haven, even a year ago. it was exhibiting safe haven behaviors. really, i think that was short covering. >> david cameron, the british prime minister, making it clear yesterday that we should not conflate the issue of what is happening in brussels with the issue of brexit. other people not taking that view. you look at the financial market reaction and that line was drawn fairly quickly. how does this story play in to what happens with that debate as we work our way through the next three months? attacks like this, how do they actually impact the story? >> they impact it exactly as the market showed yesterday. the pound went down minutes after brexit. against all its major rivals. the reason is people will draw that line, whether rightly or wrongly. david cameron has been out in recent weeks saying that the -- leaving the eu makes britain safer and stronger. something that occurs like yesterday in brussels challenges that view. there are other parties that will draw a thick line between that and there are others that will draw in inference or raise

an eyebrow. >> what is the mood like in the belgian government, ambassador? there has been criticism of the handling of this both of the government and the security forces. the spotlight, of course, has been on belgium since the paris terror attacks in november. it has led to the question, how is this allowed to happen? amb. verbeke: we may be, given the openness of our society, we are one of the most open countries in the world. as a matter of fact, we happened to be the most open economy in the world, and that openness normally is an asset, but sometimes it becomes difficult. because when things are right in the world, you benefit from it. when things are less well, you are subject to problems, as we right now face. >> what needs to be done on a europe-wide level to combat terrorism? amb. verbeke: if there is a lesson to be learned from the recent past i would say, it is exactly that the cooperation among european countries has to be strengthened.

i think increasingly most of the countries are fully aware of that. as you know, our prime minister spoke with mr. hollande yesterday. that was one of the topics he addressed. what is the point? the point is that intelligence should not only be gathered, it should also be exchanged and beyond the exchange of information, the intelligence should be actually used by the final destinations. that is not always the case. so there is some work to be done, but i think the awareness is fully there. ♪

♪ nejra: you are watching "bloomberg best." i am nejra cehic, highlighting this week's top company news. new developments and ongoing stories. last week, a chinese insurance giant made a surprise bid to top marriott's offer for starwood hotels. this week, marriott raised the stakes.

mark: starwood shares of the hotel company soaring today after it accepted in improved takeover bid from marriott. valued at $13.6 billion. are we in the middle of a takeover battle here? ed: very much so. this is a classic takeover where we saw them coming with this improved offer last week. obviously marriott has just come back to match it. they've gone slightly over it. i think what is interesting is the door has clearly been left open for starwood should they choose to come back. i think it is very likely that we will see anbang come back to the table on this one. mark: is there a game changing price, ed? what is the ceiling here? how high can both companies go? ed: it is a really good question. i think from our point of view, we think that marriott would have put more money on the table if they really wanted to put this knockout bid on there. clearly by just bumping this a small amount, it suggests maybe

they have some more room to go, but maybe the chinese come back in first and there is more of a bump for marriott. the chinese have shown themselves to be incredibly ambitious buyers in the space. they have done the strategic hotel deal with blackstone. i think this is going to be one that will run for a while, and i think we are going to see another bump for sure from anbang. rishaad: the first chinese company to sign up as a major fifa partner and also has been a major theme of the football body since the corruption scandal. roz has got more in put. roz: last year xi jinping made football a national priority. since then, we have seen some wealthy investors from china really put money behind the sport. the chairman and founder, china's richest man, according to bloomberg data.

he has been aggressively investing a 20% stake. last year with the deal with fifa, it's running through until 2030, worth hundreds of millions of dollars. rishaad: is a good value for money? is it a good use of that money? roz: he says it is very worthwhile. he says other chinese companies could sign up to become top fifa sponsors also. >> valeant ceo mike peterson is stepping down after a series of controversies that culminated in a 61% drop in shares last week alone. we know that mike peterson is out and bill ackman has two new board seats, but there is not a new ceo yet, correct? doni: we do not have a new ceo yet, and pearson is going to be staying in until they find one. but we know that the board has asked the former cfo, howard schiller, who is still on the board, to resign because they have accused him of financial impropriety, which is leading them to restate some of the results. >> shares in valeant rising

after a second day of news that michael pearson will be stepping down. hours after that news, pearson was said to have sat side-by-side with billionaire investor bill ackman and how they will adjust hundreds of workers in the new jersey office. what do we know about what they said? drew: months ago bill ackman was talking about how they were involved and interested. it seems to be mostly passive. bill ackman himself is sitting on this board after yesterday's announcement and doing a town hall style meeting with mike pearson, who has been outed as ceo and chairman of the company. they are saying there will not be major layoffs. debt is the priority to pay down here. they are looking for somebody to replace pearson as soon as possible. >> what is happening to former cfo howard schiller? can he be made to leave the board? drew: it starts to get really messy. howard schiller, former cfo and current board member, they have accused him of impropriety and how everything is handled with some of the restatements there

and have asked him to resign from the board. he has refused. he has $26 million in bonus he is sitting on. it is probably a lot easier to fight that, fight a clawback from inside the board than from outside. angie: sharp shares tumbling in tokyo. nearly a month and since it's its board voted in favor of the bailout proposal from foxconn, but the deal has been held up. peter, is there a risk that the deal could fall apart? peter: there is. as you mentioned, we are coming up on a month now since sharp's board voted in favor of the bailout proposal from foxconn, but the deal has been held up. peter, is there a risk that the deal could fall apart? peter: there is. as you mentioned, we are coming up on a month now since sharp's board approved of the deal from

foxconn. it is 26 days to stay. it is a growing list of issues that foxconn is going through before it signs this definitive agreement to proceed with the deal. they looked at some contingent liabilities that sharp has had. they are looking at some of the loans that sharp has to see if they can roll those over at lower interest rates and perhaps get some more favorable terms. they are also looking at the company's performance in the current quarter. there are reports out there that foxconn may try to decrease the amount of money it is putting into sharp, in additional equity. that was originally proposed at ¥489 billion. so we may see that number go down a bit. angie: so the timeline, when can we expect a decision or an announcement? peter: march 31 is a big day for them. they have credit lines and loans expiring on march 31, and next month we will probably see some movement with foxconn on the front to see if this acquisition does indeed proceed. vonnie: activist investor starboard value is saying they will nominate nine new members to the yahoo! board, effectively trying to replace the current board entirely. this is the 1.7% shareholder that is growing frustrated. impatient with a possible turnaround at yahoo!.

so we know a little bit about starboard's plan. they plan to take over, basically, right? erik: yes, it is effectively a palace coup. it is worth pointing out, vonnie, starboard has done this before, in 2014, when they nominated new investors in darden restaurants. it was in the process of selling red lobster and currently owns a olive garden. succeeded, and says then, darden shares are up 50%. that is not the way it is going to play out at yahoo!, because starboard is not interested in a turnaround at yahoo! what starboard wants yahoo! to do is to sell the core business and then we will see what happens. vonnie: it is interesting to see who starboard is planning to put on that board. if it can, of course. that's a shareholders agree. one would be the former head of tech m&a at deutsche bank. and then somebody who used to run directv. erik: it is not a question for shareholders, and it will be for shareholders to decide if the proxy fight goes forward, is whether they like these directors better, whether they

think they can do a better job than the current board. the current board does not have a great track record over the past 18 months. nejra: still to come on "bloomberg best," an anniversary assessment of twitter at 10. up next, the week's most important interviews, including a conversation on terrorism with u.s. presidential candidate donald trump. ♪