♪ >> coming up on "bloomberg best," the stories that shaped the week in business around the world. leaks, tweets and memos cause chaos in washington and raise concern on wall street. >> they better change here. >> they are talking the how much you will actually be able to be taxed. >> we could do with less drama i think from the white house. julia: the british government takes a hard stance on brexit. political crises erupt in brazil. and china bets big. >> i believe the u.s. will have to join this effort and join the one road program. julia: as markets leave investors to react. >> trump trade is coming to an end here. >> it is nothing to run around

with. >> everybody wants to sing come kumbaya and wants to hear that melody floating through. julia: and we recap another wild week of earnings reports. >> it is not turbulent. we are very stable. >> there is an absolutely an opportunity to drive through. julia: it is all ahead on "bloomberg best." ♪ julia: hello, and welcome. i am julia chatterley. this is "bloomberg best." your weekly review of weekly analysis from bloomberg television around the world. the week began with important news from oil global markets. saudi arabia and russia signaled oil cuts are likely to continue. >> he is going to head straight to beijing where the saudi a

a oil minister is speaking. let's take a listen. >> we have come to the conclusion that the agreement needs to be extended. we will not reach the desired inventory level by the end of june. and therefore, we also came to the conclusion that ending will probably be better at the end of the first quarter of 2018. with the same volume allocations that were included in the december 10 agreement we entered into of december of last year. >> saudi arabia and russia are making strong statements, including a joint statement that they will do whatever it takes to get to their long-term goal of reducing global inventory. >> the market is fresh and healthy. it is able to get a rally. this bullish news came at a good timing for the market, especially on the back of u.s.

data showing u.s. inventory continuing to decline. david: reactions in the markets and elsewhere to reports to the washington post and wall street journal that president trump disclosed classified information to the russian foreign minister. national security advisor mcmaster publicly denied the reports outside of the white house. >> the story is false. at no time were intelligence sources or methods discussed. david: as i understand the facts, what "the washington post" is reporting that they specifically talked about a specific threat from islamic state and identified the city which was important for this purpose in terms of inferring the sources and methods. >> that is right. the mcmaster denial was a nondenial, denial. he was denying something the washington post did not actually report. >> you just saw an hour ago a tweet from the president that says he believes he had the right in terms of sharing

information with the russians. he says he did it for humanitarian reasons. and to help russia to combat terrorism. so, the white house is scrambling to straighten out their story now that the president has contradicted his national security officials. >> i think we could do with less drama from the white house so we can focus on our agenda, which is deregulation, tax reform, and repealing and replacing obamacare. >> i think it is another example of the president being a loose cannon. and sometimes, it is not clear when he is going to shoot, or what he is going to shoot, or where he is going to shoot. emily: breaking news happening right now in washington. "the new york times" reporting president trump asked the fbi director to shut down the federal investigation into trump's former national security advisor, michael flynn. the white house has denied this report. >> the confluence of events, it

couldn't be a more tumultuous time in d.c. and the drumbeat is just going to continue. and of course, the white house is denying it ever happened. so, it does sound like something donald trump, the real estate ght say if one of his employees got a traffic ticket. but he is president. you just cannot do that. >> the u.s. dollar has fallen for a sixth day. futures are pointing lower after the latest controversy involving president trump. >> want to talk about the deep crisis -- what is your sense of the magnitude of what is happening? >> it is amazing to think that any one of these things, the emergence of intelligence information, this bombshell development yesterday, it would be almost impossible for the white house to get traction and to regroup. we are dealing with the

deepening crisis. even republicans saying that the white house is in a spiral. that they cannot seem to get out of, much of it on their own. >> it is not about comey or trump, this is about the united states of america. this is about our democracy. we must have an independent prosecutor. we need a serious investigation now. >> volatility awakened from a period of dormancy. stock three closing at lows with the dow tumbling 300 points. the 10 year yields are lowest since the brexit vote. >> talk about how this is a risk off moment and the biggest decline for u.s. stocks since september. a 370 point drop. >> there has been a change here. some people have been saying the rally has been holding up nicely. only because of earnings and because of better numbers on economic growth around the globe.

and that we didn't need trump's new proposals to take the markets higher. i think that people were saying it is ok that a gets pushed up a little bit. it was ok as long as it came in 2018. with this new scandal, or possible scandal, that pushes everything out further. all of the talk we have heard has been about timing. now, they are talking about how much you can actually get past. it is a bit of a game changer. jonathan: -- mark: volatility surging. stock markets across the world declining. the white house trying to get a handle on this latest scandal. the u.s. justice department has appointed former fbi director robert mueller to oversee the investigation into russia's alleged meddling into the 2016 u.s. election as well as possible collusion by trump campaign associates. the s&p 500 plunging by the most in eight months yesterday. asian and european markets

following the downward trend overnight. >> mueller is a very respected figure and enjoys bipartisan support. one of the longest serving fbi directors. so, he is a very reassuring figure. >> the last eight days in washington with the white house were unsustainable. i have been talking to republicans. you saw a really important mood shift. the fact that you couldn't find any republican lawmakers ready to defend the president after that explosive story about the comey memo hit, and now that there is a special counsel there is some breathing room. he can try to be the president again. >> i respect the move, but the entire thing has been a witch hunt. there is no collusion between certainly myself and my campaign. but i can always take from -- but i can always speak for myself and the russians zero. vonnie: steven mnuchin giving his first testimony to the

urban affairs committee of the senate. >> i believe that a goal love 3% -- of 3% gdp or higher economic growth is achievable if we make historic reforms to taxes and regulation. vonnie: did you feel we learned anything new about this administration or its plans? >> well, i am not sure. the secretary was very general. in most of his remarks. there is a lot of discussion. i think everybody has their own concept of what tax reform would look like. but so far, it has been very difficult to get everybody around a single plan. especially given the concerns of blowing up the debt deficit. david: at the end of a long week, the president is getting out of town, traveling for nine days to five cities in four countries. as the president setting out -- if he goes all around to change and sees back initiative on the foreign-policy front, something

that he can really do? >> there is no action that they -- have spent a considerable -- >> there is no question that they have spent a considerable amount of time planning this trip. i will say that this president's staff has not shown tremendous ability at logistics. this kind of trip requires intense planning and advanced work. things can go wrong, and they better not if he wants to make his message clear. david: as president trump his way to saudi arabia, today is a big election. voters will decide whether to keep incumbent masson honey -- incumbent hassan rouhani will be a good choice for second term. >> they look at this election in iran. >> in terms of what is at stake, it didn't go well under barack obama. it was a tense relationship and the saudis and donald trump are looking to revive this. they see a lot of gains that could be made. look, in terms of big deals, 10 possibly big deals with saudi

aramco, the state owned oil company. you look at the bigger banks like morgan stanley. they have a slice of the cake of what could be the biggest ipo in the history of the kingdom. julia: still ahead on "bloomberg best," more on china's belton road forum. it was a big deal, but will it lead to big deals? despite distractions in d.c., legislators talk to us about tax reform. and investors weigh in on the setting -- on the siding return -- on the sudden return of market volatility. up next, more of the week's top headlines, a rash of cyberattacks rattling businesses and governments around the world. >> it brings home how vulnerable the economy is on a global basis. julia: this is bloomberg. ♪

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julia: this is "bloomberg best." i'm julia chatterley. let's continue our global tour of the week's top business stories in china, where the government hosted a summit to advance its ambitious belton road initiative. >> more than 60 countries involved in the belton road initiative have issued a joint communique promising to expand trade and investment after the chinese president said the plan is already in full swing. how much progress has beijing made to move this usually a -- this hugely ambitious plan forward? >> we are getting now is a solidification of some of these parameters and getting some of clarity around some of these parameters and questions that need to be answered. we have this communique was put out by the belton road members who came here. they said and vowed to continue to push forward with globalization, trade, and investment.

we also had details around financing proposals, concerns being voiced by the germans that the bidding process process may not be transparent or fair. the germans are pushing for more clarity on that. the question is around whether the u.s. is going to participate? they gave their backing to this trade deal. emily: over the weekend, a global cyber attack snowballed to infect 200,000 computers and in 150 countries. it hit systems ranging from the u.k.'s national health service to the russian ministry of the interior. what does that tell you about the actual target and intention behind the attack? >> i think it reinforces again that cybersecurity is a very important issue. it reinforces that it is a weapon that can be used in the wrong hands, and a way that is very bad for the global economy.

in the breadth of this, there was nothing novel in this attack. it was leveraging a set of things that had been known for quite sometime, but it was done in such a broad way that it brings home how vulnerable the economy is on a global basis. >> momentum in china may be softening. factory output, and retail sales growth slipping from the previous month. what is the key takeaway here? >> the numbers are fairly good but they are decelerating from march. march was a real blowout number as we finished the first quarter with higher-than-expected gdp growth at 6.9%. what you are seeing is that march was the peak. we are seeing a deceleration. retail sales coming in at 10.7%. industrial production -- 6.5%. we were expecting 7%. march was 7.6%. we were not going to get that. that was the fastest since december 14. -- since so 6.5%.

december 2014. if you take of march, it is the pace of growth for factory output since march of last year. vonnie: a rocky decade for aig. the company is starting to show some signs of stability this year. just in time as the company names a new ceo. he secedes peter hancock. who is he? >> he is it well-respected leader. one analyst said he is the white knight coming in. vonnie: they said there may be the white knight. >> people are wondering if aig will bring another reserve charge. he said the reserves look reasonable. people are wondering if that will continue because he's coming in to invest. unlike carl icahn who said in 2015, he wanted breakup of the full insured.

he said he's not there to break it up. scarlet: ford is cutting its workforce with plans to trim 10% of global workers. the move is part of an effort to boost profit in a lagging stock price. we know auto sales have been disappointing. they appear to have peaked. is this in response to the slow down in auto sales? >> auto sales are turning down after seven years of growth. there is particular pressure on ford and its ceo mark fields. the ford board of directors scheduled extra time to have fields explain his strategy because profits were down 42% in the first quarter. they are going to be down for the year. they wanted to know what fields was going to do to turn things around. and now, and looks like one of the things he will be doing is cutting staff. >> lloyd's banking group has

returned to full private ownership, almost a decade after it was bailed out by the u.k. government for 20.3 billion pounds. should the government have waited? are there more great things to come? if you are a pragmatic shareholder and you think things are getting better, hold on for a little bit more? >> there is lots more to do, but i don't think governments should be shareholders of banks. this was a bailout which was required by rbs northern rock, , at the height of the financial crisis. taxpayer's money was used because it was a major crisis. tax payers money should not be used to bail out banks, and taxpayer's money has made better uses to it. the government did well in selling their shares. they used a good plan and sold everyday a part of the daily flow, so progressively, they diversified themselves. they got their money back. 20.3 billion pounds and around

900 million pounds more than what was put in the bank. so, they did the right thing. >> in the u.k., prime minister theresa may has committed her party to a hard brexit. she outlined the party's manifesto today, promising british voters she would deliver a clean break from the european union, and warned no deal with the e.u. was better than a bad one. theresa may: we will leave the european union and take control of our money, our borders, our laws. >> this is theresa may sitting out her grand vision for the future. not just what is going to win her the election, but the policy she believes in, which are pretty radical in some ways. she is directly trying to appeal to all of these people who voted for brexit who feel left out and left behind by globalization. no single market and immigration curbs. that's one of the big things. she is talking about doubling the levy on how companies higher

re skilled migrants. that is the kind of language that makes big corporations nervous. matt: stocks, bonds, and brazil all tumbled as president -- as the president became embroiled in a new political crisis. trading and briefly halted yesterday. sinking the most since 2008. he denies the claims he endorsed the payment of hush money to the former house speaker. in a televised address, declared he would not step down. >> this is the biggest event we have seen an emerging markets in the last six months because brazil was the flag bearer of reform. it was the leader of the pack last year when emerging markets came back from the dead. if investors get disenchanted with emerging markets because they thought it was of reform story, that has an impact as far

as korea, russia, south africa because of brazil. i think this is coming in at a bad time for emerging markets. ♪

julia: welcome back to "bloomberg best." i am julia chatterley. policy conversation was diverted, but republicans on capitol hill insist they are moving forward with their economic agenda. this week, bloomberg spoke with key legislators about the prospects for tax reform. kevin cirilli sat down with senate majority leader mitch mcconnell. kevin: the president is proposing a massive tax cut. seemingly, there could be some tension on visions. is there tension and what is the timeline? are you confident we could have comprehensive tax reform by the

end of the year? >> it will have to be revenue neutral. we have a $21 trillion debt. kevin: a lot of money. >> yeah. amount ofremendous debt during the obama years, so we will have to be revenue neutral. i don't want to put a strict timeline on it. the last time it took several years, but we want to try to complete it this congress. we want to make america more competitive. that is what it is about. we did not have one year of 3% growth during all of obama. kevin of the most controversial : one issues of tax reform has been the border adjustment tax. i have spoken to a lot of senators who seem against it. what is the chance of this being involved in all of this? >> it probably would not pass the senate, but the way we are trying to go forward is the secretary of the treasury, the speaker, and myself are trying to reach an agreement on a proposal we can all agree to start with. it will start in the house.

we have not reached that agreement yet, but we will at some point. border adjustability is a controversial thing in the senate, but we will see what is in the final thing we agreed to. >> i am not as caught up in revenue neutrality as others are. i would rather have this country go forward and take a chance than sit back and not get anything done. i agree with revenue neutrality as a goal, something we should try to meet. we will probably have to do that because of the revenue neutrality around here. david: meeting that goal, the house has proposed this border adjustment tax. a number of senators, including the republican side, expressed skepticism about it. is it feasible for a border adjustment tax to make it to the senate? >> i'm not sure that one has been proposed as much of a chance of going through.

i am open to finding a proposal that people can come behind in a bipartisan way and do. it is going to be hard in that particular area because there are all kinds of trade-offs, and whatever you do on tax reform, especially with regard to that. i am very concerned about that. i'm not sure that our citizens are not going to pay the price if we do that. if we do that, it has to be thought through and something that benefits our country, and not foreign countries. ♪ julia: moore of this week's compelling conversations straight ahead. mark mobius speaks about the impact of china's belt and road initiative. plus, some of the biggest names in trading sat down at the salt conference in las vegas. you will want to hear what they had to say. >> those companies will be in a lot of trouble.

your viewers can figure out who they are. julia: this is bloomberg. ♪

♪ julia: this is "bloomberg best." i am julia chatterley. this week's belt and road forum showcased china's vision of a new economic order backed by billions of dollars in private and public investments. will it achieve its ambitious goals? bloomberg spoke with investors about the program's potential, starting with an exclusive conversation with china national petroleum's chairman. >> cnpc is working on 50 projects in 19 countries within the belt and road framework.

of the 12 projects we are signing at the summit, some are upgrades of existing projects. some are completely new projects. depending on local resources in different countries, we mainly invest in gas projects in russia and central asia, but oil operations in africa. >> how do you think the country can mitigate its dependence on overseas energy supplies? wang: on one hand, chinese oil and gas companies like us must continue to play the role in domestic oil exploitation. on the other hand, we need to speed up our efforts in collaborating with resource-rich countries to jointly develop assets to replenish our country's ever-growing demand on oil and gas, balancing imports

with better use of resources. ♪ >> is there a financial crisis in china? >> with all these outflows, it impacts the exchange rate indirectly or directly, but at the end of the day, they have levers to change things and to regulate and make sure money does not go out too quickly, and they have already begun that effort so that when money goes out, it is targeted and specific. francine: can they displace the u.s. and trump administration as the most global country in the world or is it far-fetched? mark: the u.s. will be impacted. i believe the u.s. will have to join this effort, the one belt, one road program because there is a lot of benefit to be achieved by u.s. companies in this program.

the chinese will be careful not to favor chinese companies unduly, so there will be enough for everyone. francine: who benefits the most, neighboring countries, or africa? mark: if you look at the central asian countries, considering where they will come from, they will benefit quite a lot. believe it or not, i think europe will benefit because the europeans will get a piece of the action, and trade will increase dramatically once the whole program is completed. julia: also, many of the most powerful members of the investment community came together in las vegas for the annual salt conference, amid a backdrop of political turmoil in washington. erik schatzker gathered thoughts and insights on the market from some very special guests. ♪ >> the trump trade we have embraced and that has driven the markets to new highs in equities is coming to an end.

because -- erik: it is coming to an end? >> the bloom is off the rose. it may have to be that we need to get through this so we can see whether we get these policy measures. erik: is there a new trump trade? >> it would be a retracement of where we rally to. that is the risk, how much equities have rallied on this and the confidence of foreign -- confidence of claim of capital into the country. europe is getting enormous flows of capital at the expense of u.s. equities on a go forward basis. erik: really? we haven't seen that yet. we have seen economic recovery in europe. we have seen macron beat le pen. you are saying equity market will sell off? >> the equity markets are starting to flow more towards europe because the equities are undervalued. look at there and's this week,

-- look at their ends this week, buy europe, it is undervalued, frontpage, cover page. erik: even after rallies of 14% in spain, double digits in rants, double digits in germany? >> the situation has stabilized in europe between macron's election and what we see in germany, so we think it will be a stable place to invest. we will start to see capital flows move towards europe as the euro rallies relative to the dollar, and as the equity market in the u.s. has rallied so much, european equities are undervalued, so it could be a relative value trade that becomes the "trump trade." >> you gentlemen were expressing surprise at how long it has taken for financial markets to become sensitive to developments in the white house. why? why do you think it has taken so long? >> everybody wants to sing and hear that melody floating

through, and it happens all the time. you said why did it take so long for the stock market react to the white house, but it is much more than the white house. it is north korea, chinese islands in the south china sea, venezuela, ukraine, the middle east -- there are all these headwinds, and the nyse pretends they don't exist. erik: how do you behave as investors? >> you stay away from things that don't make sense. if i don't understand something, i will not invest because people say it's fine. i want to invest in things that i understand. if i do not think i'm not getting paid enough for the risk, i will stay away. erik: you agree? sam: yeah.

in our office, probably the most frequent question asked is, are we getting paid for the risk? we are in the business of taking risk. erik: you need to get paid for it. sam: you just need to get paid for it and you need to get paid adequately for it. >> you allocate to strategy. as opposed to individual securities? >> that's right. erik: i have been asking how the turmoil in the white house that is spilling over into financial markets affects the way they are thinking about investing. does it affect the way you are thinking about investing? >> look, when you look at the potential progrowth policies that could come out of washington, regulatory reform, tax reform, infrastructure, so our thoughts have always been you can count on regulatory reform. tax reform, maybe, maybe not. infrastructure, overblown and 2018 at the soonest. where we sit today, we are not terribly concerned yet. obviously more details emerge -- it comes back to basics. we have a good investment process, a good security or

theme that could do better if you get tax reform or better outcome if you get infrastructure, that is a good place to be. but still do fine without. erik: i see. troy: we step back, and it is becoming more apparent that regulatory relief which the executive branch controls, and they are becoming more muscular in the financial services area, particularly regional banks, and also energy, you don't need tax reform or infrastructure to do well in select opportunities there. erik: how much concern have you discerned among the participants at the conference here about what has come out of the white house the last several days, and of course, the way markets are reacting to it now? troy: the starting point is volatility has been extremely low. for some time, there has been tax reforms pushed back, revenue neutral, big fiscal stimulus? it is unclear. whose plan goes forward?

one of the mystery's why volatility remains so low. it is nothing to run around with your hair on fire. it is evidence the markets are pushing back further, if not discounting completely, two or three -- sorry, one or two progrowth reforms. some concern, but not near panic. >> years ago when the aca was being crafted, obamacare, i remember speaking to one of the staffers who helped write the bill. she told me something interesting, when i said why is there no single-payer option? she said there will be in 5-10 years. i said why? she said because of the way obamacare has been crafted, everybody will be paying higher co-pays and deductibles than they are now -- this was back in 2010, and when the public realizes how much this stuff costs because they start paying for it themselves, there will be single-payer, and i've never forgotten that discussion.

i think, actually, we may be headed that way. erik: speaking of obamacare, is there a trump trade for you in the unwind, if you will, of obamacare? >> i think one of the factors that will happen with the aca if it is repealed along the lines of the current house bill which will be watered down i suspect in the senate is that there is a raft of companies providing what are called essential health benefits. erik: hospitals? jim: well, more like psychiatric, drug addiction centers, all these things were mandated, and now they are looking to water that down as a major cost savings. a number of these companies all saw their profits explode from 2010 on. those companies will be in deep trouble. erik: can we name some of them?

jim: in addition, some of the leverage hospital companies. we will see people return to using services and not able to pay for them was so bad debt expenses go up, just like the bad old days. i will not name them. your viewers can figure out who they are. ♪

♪ julia: you are watching "bloomberg best." i am julia chatterley. it has been another busy week for corporate earnings reports. investors holding their breath for the results of retailers, and the biggest did not disappoint. >> wal-mart gaining momentum against amazon, online sales stock up over 2%. it was the e-commerce this is that killed it, 69% volume up in the last quarter. >> there are couple of things behind that. a big thing is marketplace.

walmart has been able to add more stuff to their website through third-party retailers and sellers, the way amazon has done. the old-school metrics that walmart used to be good at, return on investment, dividends, share repurchases, those investor-friendly things are taking a backseat, and we are seeing they are investing in sales growth, so it is big and hard to do both at the same time. >> tencent's investment in blockbusters and gaming is paying off, the largest video game company in china posting record quarterly sales and profits the top investments. honor of kings drove one billion plus users on wechat. >> we are seeing tencent become this hybrid of facebook, amazon, marvel, and netflix. they beat all estimates for revenue and profit this quarter. most of the growth was bolstered

by their mobile game, specifically honor of kings. that game was the top download and top revenue grossing game in the ios store in march. analysts are expecting it to make as much as 3 billion yuan in april alone and will contribute more than half of revenue for 2017. >> shares of alibaba falling in thursday's trade despite strong quarterly revenue growth and plans for a $6 billion share buyback. investors focused on the chinese e-commerce giant's quarterly profit, which missed estimates due to a tax bill and investments in cloud computing and digital entertainment. >> the minute their earnings were announced, we saw a huge drop in share price because of this earnings per share miss you mentioned. a big reason was because of the big tax hit, investments they had made and that a tax break had expired. another area of concern is

pressure on the margins. alibaba was core e-commerce business is still growing quickly, but they are rapidly expanding out of retail into areas like cloud, entertainment, and that is putting pressures on margins. there was hope and bright spots in terms of that revenue and numbers show they are able to squeeze more dollars by getting better content targeting users much better. >> often described as the twitter of china, weibo has outgrown the moniker in more ways than one. it has a larger market cap than its u.s. peer. it has more users, as our. this is looking pretty good. >> they have been able to do what twitter has not been able to do, grow its user base at a rapid rate and managing to turn a profit. they have a walled garden in china because of the great firewall, but there is plenty of

competition domestically. they have managed to beat them. shery: what does it mean in terms of competition with others like twitter? david: weibo does not have major plans to go overseas at the moment. it is china-focused. you have to ask if that is a future area for them, or at least targeting the growing chinese population outside of china. ♪ >> toshiba releasing delayed earnings, saying it has to sell its flash memory chip unit to stay alive. the company facing legal action over the chip unit itself. what is going on here? this is a company with the venerable history looking seriously challenged. >> toshiba has deep problems because of the troubles in the westinghouse nuclear business. in the process they are trying to sell off their chip business to fill the black hole with earnings, and they are trying to also figure out what they're going to do with that westinghouse unit.

over the weekend we had southern, the u.s. utility agreed to take control from toshiba, which limits some liabilities toshiba may have as long as they are able to finalize that deal. at the same time, their partner in the chips unit is -- western digital is filing for arbitration to slow down the sale. >> they want a say in terms of who it will be sold to. you have got to say, at the end of the day, it is a perfectly valid request if you are a partner. >> the points that toshiba would make is that western digital was not its original partner. they became a partner in that joint venture because they bought sandisk, and toshiba did not have any consent rights over that sale, so toshiba is saying you can't argue for rights we never got in the first place and they say that is part of that contract that there were no consent rights in the contract either way. >> japan's three mega banks are rising today despite forecasting a fourth straight fall in combined annual profit.

it comes as the impact of negative interest rate eases. >> all three banks achieve their full year guidance, down a fraction from a year earlier. the profit forecast for this year are also down 4.8% combined. the breakdown of that, two banks are forecasting lower profit, while mitsubishi ufj is forecasting an increase in profit next year from this year. i think the banks are being conservative as they typically do, and that is why they our -- are forecasting profit. >> a little worse than expectations, 236 million pounds in the red. is this as bad as it gets, and

what is your expectation for the story going forward? >> there were no real surprises in the first half loss. 19 out of 21 years, they have lost money in the winter. break it down, easter has moved from the first half into the second half, that is racing. 45 million pounds of loss, and the foreign-exchange headwinds is 80 million pounds, so before we started the first half, the market knew there was 127 million lost against easyjet, that is a normalized lost in the first half, so not turbulent, very stable, navigating our way through the referendum. we know what we will do about that, and what we have said is the second half is that we are holding guidance. cisco, the biggest maker of what runs the internet, beat earnings and revenue estimates, but the stock moved down because its sales forecast was cautious. part of the reason why your stock did not do well is because

you said going forward, it is looking soft in terms of purchases. are there mergers and acquisitions you could do with c --ash shareer -- cash share holding to can fix that problem? >> we have more than doubled the amount of dollars sitting on our balance sheet from software and subscriptions in the last eight quarters, and it was up 87% last quarter, now $4.4 billion, so that transition is moving. we put 500 million on the balance sheet in the last 90 days, so we are accelerating that. technologies we have built internally that are contributed to that balance, we have acquisitions like appdynamics that we closed last order that will contribute to that. absolutely, there is an opportunity to drive m&a to do that. as i said earlier, we see our own internal ability and m&a that will be the strategy we will deploy going forward. ♪

♪ >> this is the commodities price forecast function on the bloomberg. it charts 35 analyst view on oil price and where they see it headed. >> take a look at the bloomberg. this is the curve of the vix. the green line is about a month ago, and the orange line is where we are right now. >> the number of tweets containing the word impeach and trump together has spiked overnight. you can grasp these things using the nt function on your bloomberg. >> there are about 30,000 functions on the bloomberg, and we always enjoy showing you our favorites on bloomberg television. maybe they will become your favorites too.

here is another function you useful, quic will lead you to quick takes where you can get important insights into timely topics. here is a quick take for this week. >> japan is the world's senior citizen. birth rates are falling, and people living longer, meaning japan has a population aging and shrinking fast. now the government is encouraging people to have more babies and industry to use more robots and ways to bring in more foreign workers. here is the situation. japan's population is forecasted to tumble by one third to below 100 million between now and the middle of the century if the current trends continue. over 64-year-olds currently account for a quarter of the population are expected to reach 38% by 2048. the demographic shift is causing a shortage of workers and starving the economy of labor. employers are struggling to fill

job vacancies. in tokyo alone, there are two vacancies for every applicant. the prime minister is introducing policies to curb excessive working hours and improve care facilities for the elderly and children. progress has been slow, and it cannot make up the labor shortfall. other reforms include a robot revolution, encouraging automation in everything from rubber factories to medical care. his moves to loosen labor rules have had had some impact, doubling the number of overseas workers to more than one million in the eight years leading up to 2016, but that is still not enough. here is the argument. an aging population brings dire fiscal implications, including unsustainable debt and contributing to deflation. the electoral muscle of the elderly who are far more likely

than the young to vote, meaning it is hard for politicians to do more to trim benefits. while the japanese recognize an aging population is a problem, most are wary of immigration. the reason for that is a desire to preserve the country's unique cultural identity and a fear of increasingly ultra low prime rates. according to a united nations report, japan needs to attract 647,000 foreigners a year to maintain its population, yet with other asian countries aging rapidly, experts say japan may struggle to attract the number of foreigners it needs. ♪ julia: that was just one of the many quick takes you can find on the bloomberg. you can also find them at bloomberg.com, along with all the latest business news and analysis 24 hours a day. that will be all for "bloomberg best" this week. thank you for watching. i am julia chatterley. this is bloomberg. ♪

♪ david: do you get tired of people asking you what it feels like to be a woman c.e.o.? mary: it a question that gets asked more than it should. david: do your children treat you with more respect? mary: my son reminded me last mother's day that "your most important job is mom." david: the government put money into general motors. did the government get its money back? mary: we will be forever grateful for what the government did. david: your board of directors -- [indiscernible] mary: if it is from general motors, i think yes. david: people would not recognize me [indiscernible] let's leave it this way. ♪