♪ betty: the only way is up. all 12 asian future markets gained after wall street set record highs. china's inflation situation has been accelerating. apple closes at an all-time high with hopes of a next-generation iphone with sales and growth. akkei says toshiba will issue risk morning after charges set to top $6 billion.

this is the second hour of daybreak asia. yvonne where it is just after 8:00 a.m. betty: i'm betty liu. as you mentioned at the top, we are waiting for inflation numbers coming from china. and a little later, we will get confidence confidence index out of australia. we will see how sentiment is there. in the u.s., we are waiting the of steveion vote mnuchin, the treasury secretary nominated by donald trump. the economy is missing a treasury secretary from that treasury secretary from that department. that is being awaited by the markets here. y of steve vonne: they will have to do quite a bit of catch-up.

the markets have been waiting. no doubt, we have seen bullishness in the market. talk about inflation as well. we had south korea, taiwan report inflation figures. one set of deviation. china, maybe we can see some prices rise when the numbers filter through. let's check the market open here in tokyo. here is david. david: it might come down to pork. we have to talk about pigs later on. currencies, the broad story is the dollar is a little higher overnight. it is very early right now. aussie-dollar is a little bit higher. might be a little bit of the lift as we continue to see this positive commodity prices. let's take a look at the rally across the metal space. three metals and oil, receiving a little bit of pressure. a drop overnight with output

from the u.s.. again, when you look at the ,ommodities space -- iron ore $93, highest level since 2000. again, densities supply to thesens -- down supply disruptions. the commodity markets tend to dance a little wildly. to these supply disruptions. you have japan, south korea not as good as australia and new zealand. i'm seeing momentum coming down ever so slightly. maybe a notch or two. 1/10 of 1%. we are seeing this rally -- i me ntioned this early. we could have 10 markets over the terrain. buy at your own risk, i guess. yvonne: you could make a lot of money.

we will be previewing chinese inflation and a little bit. we will see how this shiny data plays into other economies and the market. david: absolutely. this is one of my favorite charts. it is on your terminal. this is really a good way to explain what happens in china -- we will see how thiswhen china n china. this is the bloomberg version of what happens in vegas does not stay in vegas. we will be talking about the preview. here's your period of deflation. it affects everything. you have korean exports. you have caterpillar sales in asia. hitachi machinery, heavy equipment. the amount of loans japanese banks have to dole out. with this turning positive, it does seem, it could add a

little more reason for investors to buy. yvonne: thank you. let's continue the conversation with the upcoming inflation figures out of china with stephen engle. talk about a higher base affects. is there weight to be put on these numbers when it comes to determining these prices? stephen: it is interesting because we have already seen that the authorities are starting to do targeted tightening. the benchmark rate has not moved in a long time. the requirements of banks have not stopped in a long time, but the authorities are moving to much more targeted tightening measures not to affect the broader recovery. they have to talk about ppi. i want to bring up cpi inflation. it is well below the government's four-year target, but it is still creeping up to the highest expected since may

of 2014 which is 2.5%. we are up to likely to .4% since january of this year. 2.1% since december. high demand raising those prices ahead of the lunar new y ear. food prices coming down a bit so that has maybe tempered what could have been a higher rise. now to ppi, this is likely rising, quite sharply, for a fifth consecutive month after four years of deflation. the forecast is for 6.5% rise year-over-year. commodity prices feeding into the input cost. flat at industrial markets. it helps boost profits for these chinese industrials, but raising the prospect of tightening. betty: it does indeed. we were talking about with our last guest, but it also depends largely on these prices creeping

into consumer inflation. stephen: that is right. these industrial companies will have purchasing power. why are we not seeing a sharp rise in ppi inflation, which could be down the road. it could help explain one of the reasons why. the white line is the bloomberg inflation food tracker. as you can see, food accounts for one third of cpi inflation. when that goes up, cpi goes up. down,rrices are vegetable prices are down. down 6.4%. i could even get into meatier detail. zucchini down. chive, 13.3%. that is keeping a lid on what could otherwise be a sharp rise in cpi inflation. betty: you were making me hungry

for a moment. yvonne: let's get the first word news with nina. nina: thanks. president trump promises to respond to the latest melissa missile launch by north korea. trump has vowed to prevent them from creating the capability to strike the u.s. with a missile. president trump: we have problems and a lot of people have no idea how bad they are. not only internationally, but when you come right here. korea is a bigh problem. we will deal with that very strongly. nina: china says it opposes north korea's ballistic missile restraintcalls for ahead of the un security council

meeting. it could give the trump administration and beijing common ground. japan has urged china to take action against north korea. china is the largest trading partner. the u.s. has imposed sanctions against the venezuelan president following years of investigations into his alleged participationjapan has urged che action in drug trafficking and money laundering. he is the highest ranking venezuelan hit by sanctions and consistently denied all other allegations. iron ore prices has raised to a three-year high which could impact the aussie dollar. australia's finance minister says the value of the dollar is of no particular concern. >> the value of the australian rised as it has been. of theperceptions

economy, all of those things valuationthe markets of the australian dollar. it is what it is. day: global news 24 hours a powered by more than 2600 journalists in more than 120 countries. this is bloomberg. betty: thank you. apple shares closing at the highest level ever. on optimism the next iphone will drive sales. let's go to alex webb. as we talked about earlier, is this. lee about the iphone? alex: largely about the iphone. every iphone they sell, they can sell more services. they can push the app store. it accounts for two thirds of their sales. they remain the iphone company. there is this chart for our viewers to see as terms of

the growth we have seen. it is not superseding output alphabet's market cap. bullish on where the stock move over here? $10: i think it is about a difference between the price now and the 12 month forecast, average forecast. the thing is quite interesting. even though the stock is highest market's, the valuation is not. they have done a lot of buybacks and dividends. that has reduced the free flow and therefore not a record market capitalization record.

it is not said they are the highest capitalization company in the world now. betty: alex webb, thank you, joining us from san francisco. yellen's testimony to congress for the next set of rate hikes. plus, our next guest believes a long dollar rally is entering its final phase. more with chase morgan asset management, next. this is bloomberg. ♪

betty: this is daybreak asia. i'm betty liu in new york. yvonne: i'm yvonne man. south korea's special prosecutors office says it will decide soon whether to seek a new arrest warrant. he was question for 15 hours on monday over allegations including bribery. they also faced interrogation. they cannot comment on a prosecutor's details as s

hares dropped lower. betty: sources told bloomberg that sinocam may take a stake. is interested in the international trading business. noble feels it is in a stronger position to negotiate a deal with its equity price stabilizing and rising bond yields. yvonne: prada with more than a year of sliding prices behind. they saw positive results last month despite a 9% drop in annual sales. the luxury goods maker says europe and asia were the most dynamic markets. china shows clear signs of recovery. betty: stocks and asia are gaining this morning after wall street surged. let's get more on the markets with the head of asia-pacific asset allocation at jpmorgan.

taking a look at all the gains we have seen, i don't think we this sinceevel like june of 2015. it seems all directions .2 up point to up now. what do you think about his rally? this rally? guest: it is opposite of what is driving the asian markets at the moment. i think that is one of the reasons we are seeing strength. if earnings do not actually materialize, and right now --king at 12%, 15% this year if that does not materialli ze, we may see an uptick in equity markets. the u.s. dollar has been key as well. we have seen the recent ball market. we think we are at the tail end of that. recent action would suggest we are. but we do see a resurgence in vis-a-vis asian

markets, we may see a tail off in equity markets. betty: you are saying -- couldn't go either way? we are still seeing if donald trump wants a weaker dollar policy or stronger dollar policy . that should be announced in the next couple of weeks. ayaz: the valuation against other currencies. we look at the u.s. dollar valuation and we measure it by real value. there will be some politics, but fundamentals will ultimately prevail. isht now, the u.s. dollar its 10 year high. politics can drive it a bit more and that is why we are saying it may be in the final stages. u.s. interest rates are likely to increase for a while. its 10 year high. politics can driveas long as t'y we think the u.s.

dollar may have a little bit left. yvonne: we were talking about the velocity we have seen in these index theses in asia. we have seen some solid gains. the signals seem to be sounding large and loud now. the big thing driving this is the mainland investors. they are slowly snapping of these hong kong stocks in the city. do you expect that to continue? why is there such a surge from mainland investors? ayaz: they still have very limited opportunities and where to put their savings. this is putting their money into an international market. chinese saver the can own property in china and buy i bank deposits. this is a new investment opportunity for them. second, although they had rallied, we put in valuation

context, it is pretty reasonable. they've been down for a long time and we are looking at the average at 10 or 11. we're looking at a stable macro environment in china at the moment with all the numbers coming up. i think, yes, they have come up a lot, but they were beaten a lot before. -- you areant to ask not the only guest that has come on and said emerging markets are a good opportunity right now. perhaps the dollar will not k havoc like last year. david was on yesterday, but he said it's coming back. david: there is a lot going on.

your concept is interesting because we have talked about that element for i don't know how long. this should pick up one by one. they have short elements to be investable. betty: we thought it died with the financial crisis. do you think they are coming back? ayaz: it is lovely to hear that term again. i know a few things. -- brazil,ct brick russia and china. ine macroanin f stability in china. india, the whole demonetization part affected the markets. i was in india recently and a lot of it has gone back to normal. if we look at the last quarter results, it is on the upside. iflows will continue. part affectedvis-a-vis brazil ae

whole commodity space will be capable in russia. we're looking at a deflationary world led by the u.s. we look at what the new administration is doing, looking at tax reform. on trait will be good for commodity space. yvonnebetty:on trait will be god for commodity i want to focus oe u.s. markets. you mentioned investors, the vix index or volatility we have it indicate perhaps what might really be going on with volatility? i want to focus on the u.s. and what we usually measured or volatility, vix, really at near all-time lows in the last several years. down to 11 right now. what are you seeing with volatility that is not being portrayed when you look at the

data itself? difficult tolways predict what will shock the market and went to take out volatility again. certainly, if we start looking at a more protectionist policy, that ultimately will not be good for earnings globally. i think that could cause a bit of a shock. right now, the markets are not looking at that very closely. i think a more protectionist world will perhaps lead to more volatility in equity markets in general. yvonne: thank you so much. ayaz, the head of asia-pacific equity allocation at j.p. morgan asset management. much more ahead. president trump edges closer to getting one of his more controversial cabinet picks conference. irmed. they are voting right now for steve mnuchin. ♪

yvonne: this is daybreak asia. betty: now, the senate is right now voting on the nomination of steve mnuchin as treasury secretary. there is a live picture of the senate vote happening at this moment. confirmed,ted to be pending one of the top or nomination battles for president trump's cabinet picks. they have been pretty tough so far. confirmed, pending one of the top or nomination battlesjoining me no. ramy: three weeks ever since the u.s. actually had a working secretary of the treasury. it's actually the biggest gap ever in terms of their wait peri od because of democratic opposition. we are still waiting for the vote count, but they expect it will be along partyline votes. we are still seeing that come in. it is expected very soon. we are expecting him to be

confirmed. and then, investors, the financial world is waiting for him to get on board to say this is what we are going to do. or thetax regulations regulations. ramy: we are still waiting for that. yvonne: i think you can add repealing the affordable care act. talk about this meeting between trump and trudeau. the canadian dollar strengthened. altogether, this meeting was quite positive. ramy: very positive. it was very amicable. they shook hands. they nodded at each other statements. very different of what might have been expected with mexico's president and donald trump. economic policy and trade policy and security policy has been strong between the two

countries, the u.s. and canada, and they will continue to be strong. they talk about nafta and trade. let's listen. president trump: i pledge to work with you in pursuit of our many shared interests. a stronger trading relationship between the united states and canada. 35 u.s.nister trudeau: states list canada as their largest export market and our thetry benefits from two-way trade that takes place every single day. ramy: i'm getting breaking news now. we are confirming there are enough votes to confirm steve mnuchin as treasury secretary. breaking news right now live on the senate floor. nowsenate treasury nominee having enough votes to be the treasury secretary. yvonne: widely expected.

ramy: we'll know the exact number but expected to be along partyline votes, 52-48. we will continue with this developing news. ♪

>> 8:30 in singapore. now just a half hour from the open of trading there. looking to be a very sunny valentine's day there this morning. i'm yvonne man in hong kong. >> brightening up a bit there in singapore. i'm betty liu here in new york. you are watching "daybreak asia." breaking news out of australia. looks brighter as well for business there. the nab business conditions index up at a multi-year high at 16 where the index reading is for the month of january carrying over from a positive numbers we saw in december. business confidence also up -- also higher up to 10 is the reading. higher than the six that was back in december.

we've seen these numbers, or seen the confidence increase, given the higher commodity prices, higher oil prices helping australia but of course there are lots of concerns about how long that will last and whether we might see it petering out later this year. also on the residential side as ell is that going to start affecting the australian economy. we'll go to the first word news now. >> thank you, betty. toshiba shares are falling in -- there r the nikkei is already a huge loss and broadcaster nhk says an impairment charge on its nuclear operations could top $6 billion. the nikkei says the loss will probably wipe out shareholder equities. saudi arabia has told opec it cut oil production by the most in more than eight years going beyond its obligations under a deal to reduce supply.

however, opec's only analysts estimate saudi arabia made a smaller reduction though still in line with the agreement. oil prices rallied in the weeks after the output deal but have since faltered on concern over the increase in u.s. shale production. the water level at the tallest dam in the u.s. dropped monday. easing fears after collapse that saw 200,000 people ordered to leave their homes. california officials may use helicopters to drop loads of rock on the eroded spillway at the lake, 240 kilometers northeast of san francisco. heavy, recent rain forced the use of the dam's emergency stow away for the first time in almost 50 years. taiwan's capital has seen 32 people killed and several injured. the bus flipped off an entrance ramp in eastern taipei tuesday night. most on board were senior citizens who had been on a trip to view cherry blossoms.

cnn said no foreigners are believed to be involved. this is bloomberg. >> time to see how the asian markets are shaping up this morning. and see if there is any reaction to the australian business confidence numbers. i see a little bounce with the aussie dollar right now. >> yeah. and i guess you're being generous there but yeah. i mean, when you look at the broader markets though and talk about the yen and japan in just a moment because there is some pressure coming through the last few seconds or so. that being said i'll get to that and have a look at singapore futures. opens up in 30 minutes' time. we're getting a fairly large chunk of this market already above the 200 day moving average. 3/4 of stocks on the index, 73% above the 200 day. one of those markets i mentioned earlier, having a sell signal if you will, that is something to watch. 30 minutes' time.

all right. flip the boards. and let's have a look at equity markets. two of the four on the way up. again, seeing some pressure now on south korea, flat. most stocks are down. japan is just raised the gains the last few mints or so. heavy selling in dollar/yen at the moment. we basically came from about 113.70 about 113.59 at the moment so when you look at the yen, dollar/yen coming down or falling if you will, obviously it will weigh on the nikkei 225 at the moment. let me give you a breakdown. we're down what, 10, 11 points. movers, bringing things down. just a minute. a quick lead. there we go. most stocks are still up though you have a fairly decent portion under pressure right now. 96 out of the 225 on the way down. now, flip the boards again and let's have a look at the commodities space here. some of the movers of course and we'll get to this in just a moment. this really speaks to this

rally in commodity prices, right? you have 3.5%. the mining, a little of both. return to profit. a weaker yen. higher metals prices feeding into the stock right now, gaining the most in three and a half years. nickon, camera maker down 12% cutting the full-year forecast here and getting a downgrade from mcquarry to neutral and setting the profit target here analysts lower than expected. let's wrap things up with commodity markets. we're looking at metals prices on the way up. copper, iron ore for example. two contracts here. you have the pricing setting overnight of course the highest level since 2014. guys? >> thank you, david. ors around the world

are going to be watching the fed chair jannet yellin's testimony to congress later today. for any hints on the number and timing of the interest rate hikes this year our economic editor kathleen hays is here with a preview of the markets. we are expecting two rate hikes but there is a narrow consensus we may get three this year. kathleen: it is always an important testimony. twice a year the fed chair has to go before congress representing the view not just of his or herself but the entire federal market committee. talk about the economy, the path of monetary policy. we expect jannet yellin to say number one it is really hard to tell you what i see because we aren't sure because we don't know what donald trump is going to do. if he can put through fiscal stimulus and get the economy going that is one thing but if he doesn't that is another thing. potentially, she'll tell us she wants to keep her policy options open and not lean too heavily to increases or just two, slowing down. a look at the chart. she has said recently we're near the fed's goal, the

duellman date. this is # 3476. the purple line. isn't it beautiful? unemployment falling. labor market getting tighter. the white line kind of flat the last couple years. core p.c.e. what are the key issues? here are three of them. two or three hikes this year. what kind of hint does she give? happy about the eek sni okay. ready to move quickly. for example. maybe not so worried about the economy over heating. balance sheet management. despite trillions of dollars by the fed, if they start hiking rates part of the policy path is you got to start selling off the bonds. they haven't talked about it yet, safe to say. maybe janet yellen will talk about that before congress tomorrow. you mentioned key issues for er then but you hear, too, the fed bank presidents have said that march could be a live meeting. is she going to have to agree during this testimony? kathleen: i don't think she has

to agree at all. i think it would be great if her comments even if very subtle give us an sense the fed chair, the most important vote, is in line with the two fed bank presidents or not. the market is not in line with the two fed bank presidents. you'll see as we call this up far upper left-hand corner shall the next meeting march 17, probability of hike, 30%. betty pointed out, an astute fed watcher now, betty was lower. it has moved up a bit. betty: a hawk on words. kathleen: there you go. i love it. we'll turn the world into fed watchers, yvonne. the market is not expecting it. if she signals she is onboard i think you'll see moves in markets particularly in bonds. let me share with you some thoughts from a world fed watcher university of oregon economist. he said no the fed won't hike in march. the employment rate just dipped up to 4.8%. that is not a bad sign but really not oh, you must hike rates right away sign. core inflation? three months of the year at the end of 2016, only moving average 1%. far from 2% and the fed isn't going to do a preemptive hike.

i think that is a good point. why do that? one more chart if you'll bear with me to illustrate something that the president of minneapolis fed, a voter, says, one reason he is not worried about inflation. there is no wage pressure. those are two big labor market indicators. average earnings and the employment cost index, they are both kind of flatening out aren't they? if you look at the far left hand that's where we were with the financial crisis. it is a long way to go to get back to there. >> what about when it comes to rolling back dodd/frank? certainly weef a he heard from the trump administration that is possibly on the chopping block. are there any senators on this banking committee that are going to push for that? kathleen: chopping block is a great analogy. i have a picture in my head for dodd/frank, yvonne, because i think that is what donald trump wants to do with it. just lop a lot of it right off. central bankers want to keep higher capital requirements for banks. it is very interesting the chair, the republican head of the senate banking committee is considered a centrist.

kind of a moderate, let's constructively change dodd/frank is what he has said in the past. the ranking democrat has been, has railed against big banks, too big, too powerful, but wants to keep in place the consumer bureau of protection to keep the financial transactions safe and transparent for consumers in this country. tomorrow, the head of the house financial services committee, a big proponent of really gutting dodd/frank. i think that's when you see the fireworks. at any rate, that will be potentially a very interesting part of janet yellen's testimony as well. >> all right. kathleen hays, thank you. we'll talk about earnings here. singapore's ocbc which we broke a couple hours ago missed fourth quarter estimates saying continued stress in the oil and gas industry led to higher provisions. we'll go to our southeast asia correspondent for a breakdown of the numbers and we have been talking about how challenging the banking environment has been for singapore in particular. we're hearing bad loans once

again being the culprit. >> well, yvonne, like you said, it's been tough. profitability, limited pretty much by warren buffet. for the fourth quarter, allowed to jump almost 60% for ocbc. i want to show you this shot. you can see how lendors in singapore have been putting aside more and more money. we've been talking about the struggling energy sector here. at least four companies have defaulted and recently ezra came out to say writedown amounting to almost $2 million. banks yes feeling the heat. and here's the break down for ocbc for the fourth quarter. profit coming in at $553 million versus $606 million estimates. fell 3% year on year. loan growth grew at a slower space than deposits. now it is all coming at a very bad time. the domestic economy as you know is slowing, impacting loan demand. ocbc is the first singapore bank to report earnings this

week. its rival expected to show a similar trend as well. yvonne? >> despite the concerns over the bad loans are bank stocks like ocbc, they've been rising, so what gives? why is that? >> well, it's a bet on higher rates, betty. ocbc and other bank stocks getting a boost from expectations rates are going up. that's why ocbc has gained more than 10% since october. d.b.s. doubling the increase in the same period. if and when rates rise, borrowing costs will rise in tandem boosting interest income. if you take a look at the recommendations boy the way, 20 out of 24 have a buy or hold rating on ocbc including the likes of morgan stanley and mcquarry plus banks like ocbc have been boosting other businesses like wells management, like private banking, to help offset the challenges from the energy sector.

that strategy, so far, seems to be working. betty? >> thank you so much. much more ahead. toshiba may reportedly issue a warning that it can't continue as a going concern when it reports a huge loss later. we'll have details from tokyo, next.

>> this is daybreak asia. i'm betty liu in new york. >> looking for ways to reduce debt, sources say the company is considering options including a sale of its branded general e. unit which could be worth $7 billion. we're told they may also sell other noncore assets such as the active ingredients business.

teva's debt ballooned to nearly $36 billion last year after a series of acquisitions. >> the united a-emirates is known for its love of glitzy super cars and now tesla is joining the show taking orders for summer delivery. tesla also plans to open its first service center in the middle east in july and will support online sales with a popup store in the you buy mall. >> singapore's month story says it will do more to strengthen finance channels for companies. the m.a.s. says it wants to simplify the rules for venture capital managers to support start-ups and is also studying the possibility of introducing dual clash shares that would help support high tech companies. unsolicited ng, an bid from a movie and

entertainment group. tvb raised and cut the number of shares to be purchased. share holders have to reject the share buy back plan to accept the bid from tlg. >> take a look at toshiba shares now. it is falling some close to three% in tokyo this morning. this is on warnings of a large loss related to its nuclear unit. hk says large could mean 6.2 billion dollars. for more, we'll go to our tech reporter in tokyo. how bad is it going to be i guess is the big question. >> you know, the funny thing about today is that it's all basically a self-assessment by toshiba. there was no real outside pressure for them to review their nuclear operations. it all kind of is internally driven. so what they come out with today would be a subjective opinion of what they think about their nuclear power business. you know, on the one hand they could throw from in the towel. it's been going terribly for the last decade. they could say, hey, we give

up, we'll restructure this, going to try to sell this because we don't know how to do this right. they could say, hey. it looks pretty bleak. give us time. we see the light at the end of the tunnel. we think we can turn this around. i think based on reports that, you know, what the media is reporting it does not look good. it looks like they are getting ready to throw in the towel. we'll find out in about a couple hours here. >> we're going to find out a lot we hope, right? or these share holders hope in the next few hours. you mentioned the two options throw in the towel or try to turn the company around. tell us a little bit more about this and the decision that it is likely to make. >> yeah, you know, toshiba got into this about a decade ago when it bought westinghouse. the nuclear power plants have been around since the 1950's. to the 1970's they built a couple hundred all over the world and then you had a bunch of accidents. 3 mile, chernobyl. and so after a hiatus,

companies like westinghouse, which toshiba owns, they said you know what? the previous, old power plant models we used to build were always over budget and behind schedule. we have a new way to do this. we'll build this little lego pieces and bring it all together at the end instead of building it all at once and everyone bought this including toshiba. that's why they made the bet on westinghouse a decade ago by paying $5.4 billion for the company. now, that hasn't worked out. the new design is still unproven. all of the older plants are behind schedule and over budget. it is not looking good. the question is are they going to throw in the towel or do they think they can turn it around? >> thank you. ertainly a lot of questions. coming up, a.i.g.'s former c.e.o. hank greenberg settling a decade long lawsuit. but there are still hard feelings. hear more of my interview with hank greenberg next. this is bloomberg.

>> this is "daybreak asia." i'm bettyly in new york. >> i'm yvonne man in hong kong. time for a quick look at the next two hours here on bloomberg. the inflation numbers in china at the bottom of the hour. >> about 37 minutes away from now having looked at the implications. it is still positive. look at 6.5% for that. that should tell us more about

inventory overhang disappearing and the excess capacity in china perhaps being whittled away. a look at u.b.s. and then a look at the trump effect and how the campaign fits with america first from donald trump. the two are perhaps contradictory. university of maryland's professor will join us with a look at that one. in six or seven minutes the singapore market opens and we'll look at ocbc's latest set of results. that is all on the way. >> that's a lot, rish. thank you so much. coming up on "bloomberg markets." the former c.e.o. of -- hank greenberg saying he never admitted to fraud in settling a decade long lawsuit and he said he was surprised when the new york attorney general said greenberg admitted to two fraudulent actions. i spoke to him earlier today about why he agreed to settle. >> well, we agreed to do

mediation and the mediator has been working for two months. >> ken feinberg. >> yeah. went back and forth. mediation. eed to nd so it was finally done. betty: did you think it would get done during this practice? mr. greenberg: it was hard very hard to say. betty: are you happy with the settlement? >> i'm glad it's over t's gone on for too long. 12 years. betty: 12 years of your life. >> yeah. a lot of people spending a lot of money. think about that. e settled for $9. -- for 9 million. my guess is that several hundred million was spent. betty: on your part? >> on our part probably about 200 million. i don't think it was less on the state. betty: all to settle for $9 million. >> what does that tell you?

betty: what does that tell you, hank? >> how unimportant this thing really was and how wrong it was. the act is a disaster in new york. just a disaster. betty: that's what spitzer used against you. >> see what happened. a great company was virtually destroyed. a largest insurance company in history. thousands of people lost their jobs, good paying jobs. we were the leading company in the world. 137 countries. we were a national asset. and now it's a shadow of what it was. betty: hank, i want to get to a.i.g. in a moment. you are running c.b. star now. you left a.i.g. and started this or continued to accelerate the growth of c.b. star. so settling this lawsuit, what does that allow you to do differently than before or does it not make a difference? >> i have more time. betty: that, true. were there things you couldn't

do before because you were fighting this case? >> well, taking time, i just had to pay attention to it. i have more time now. betty: so the a.g. office when they issued their statement on friday said that essentially ust to paraphrase it, this is, to paraphrase, essentially it was, finally hank greenberg admits to these allegations that we have been pursuing against him for the last 12 years and you and your lawyer came out and said that is absolutely not true. we didn't admit to anything. so where is the disconnect here? what is going on? >> listen. the a.g. signed and agreed to the wording of the agreement, of the settlement. they signed it. betty: and that wording did not say -- >> anything like fraud. there was no word of fraud in anything. there was no fraud. betty: no admitting fraud. >> there was no fraud.

betty: so did they just go off the reservation in this statement on friday? >> you have to ask them. betty: we did actually and they reiterated their statement on friday. >> well, they were wrong. betty: okay. you are going to continue your defamation case against eliot spitzer. >> yes. betty: where does that stand right now? >> it's in the courts. we're waiting for an opinion from the appellate court. betty: are you relieved this is pretty much behind you now? >> i thank relieved is not the term. i'm glad the truth is coming out. i feel sorry for thousands of people who lost their jobs. i'm sorry what happened to a.i.g. as a result of all that. i'm sorry for the loss to the country of a great asset. it's wrong. the barton act should be abolished. it's a disgrace.

betty: again, former a.i.g. c.e.o. hank greenberg. yvonne, hank mentioned he feels like a.i.g. as shell after company now. it is not quite a shell. it is certainly much smaller than it was before but it used to be this big insurance giant with a huge presence as well in asia before it started selling off assets and offices around in japan and elsewhere. greenberg of course with close relationships with government officials and china and elsewhere had made a, had a big foot print but not so much anymore. yvonne: thanks for bringing that interview. to really hear his take on this . ter 12 years bloomberg markets, next.

>> it is 9:00 a.m. in singapore. midday in sydney. i'm in hong kong. this is "bloomberg markets asia." asian stocks marching forward, more than a year after a new wall street record. going to be breaking china's latest inflation data this hour with consumer and factory prices both set to accelerate and watching o.c.b.c. shares after earnings missed estimates after surging bad loan provisions.