♪ >> asia-pacific markets look like they are starting on and upbeat note after more highs on wall street. topping 24,000s points after john mccain signaling his backing for the republican bill. extends the oil curves with saudi arabia and russia standing together. the restriction runs through the end of next year. >> and goldman sachs says a wild

ride still means it is far too early to say hello. welcome to "bloomberg: daybreak asia. >> i have some breaking news. south korea data coming in. gdp numbers first. the final reading of the third quarter readings. they have been quite bullish in the preliminary numbers driven by exports growth out of south korea. 1.5% are the final numbers, slightly better than the preliminary figures. also, above what the preliminary numbers weren't that were reported earlier. inflation also coming out pretty tepid. a decline of 0.7%. a retraction. no change was expected month on month. and year on year inflation falling short of forecasts, 1.3%.

it was estimated to be 1.8%. and core cpi year on year toling short, 1.2% compared the estimation of 1.7%. happening asion is the bank of korea raises things by 25 basin's -- basis points. have raised said we rates but it is still very accommodative. paul: it will be interesting to see what the bank of korea goes to next especially considering the weaker than expected consumer prices. let us look at the markets that are open on the asia-pacific. new zealand. strong dayer the from wall street. the kiwi dollar a little lower than the greenback. underwayst getting

here in australia. hard to say where we are placed this early. early. looking good, up 0.2%. it might be worth taking a look at telstar today. they have revised their guidance. elsewhere, we at the aussie dollar still showing a bit of strength. 75.5. the aussie 10-year looking like this. we are also counting down to the open in japan and korea. let us look at japanese futures trading out of chicago. higher. and the nikkei 225 also higher. us take a look at how we traded here on wall street leading into the asia session. of thepretty much all major groups on the s&p 500 rising today. a lot of optimism about tax reform and we saw the tech sector rebound quite dramatically. su keenan is here with what a

big difference today was. su: yesterday, almost every major tech name was down. high from a record the dow jones industrial. the s&p 500 in their -- in its longest monthly streak since 2007. kroger was surprising, a grocery store. a sector under pressure. a big winner on positive results. -- of a word of a day deal in the works. western digital is still reeling from the comments from analysts. the bloomberg world growth forecast. while this is interesting -- world gdp forecast. barclays suggests this is as good as it can get. bullish. predicting the

fastest expansion with a sharp upturn. and gradual acceleration is being seen in price pressures instead of a surge. because ittle clunky is not frequently updated but you can see the massive upsurge expected to flatten out. as good as it gets is the take away. we had a few economic reports earlier today. they showed that consumers are shifting into the slow lane. what happened? big surge in auto buying and other big-ticket items post hurricanes. it certainly seems like we are slowing though analysts will say it is still decent spending coming off of the robust numbers. we also have claims falling. you're looking at fedex video because fedex is often an

indicator of the economy. as we look at those workers, decreased in the new york area. in terms of consumer optimism. -- there was a bump up. interesting that the fed numbers are starting to near the target that the fed has set. that is positive for the latest data. look ahead to the friday job data. oil, we areg about seeing the fight -- the prices surge as opec extends the cuts. su: what you're looking at here is the up and down we have seen this month net positive. you are seeing it come off the bottom. opec does extend. the real surprise was with the two non-participants including

nigeria. those are allies outside of the group helping to extend the campaign to pull control back regarding the output. let us go into the bloomberg. oil supply production. mission accomplished is what this target is being titled. mission being accomplished is the operative word. mobil oil and inventories have been cut. you can see that this is the output. yellow is the opec production. that clearly has come down. fundamentally, the cuts have worked well. there are still some questions in the u.s. but oil is supporting a price of a $58 which is positive at least as far as the bulls are concerned. let us get the first word news now. here is courtney collins. house and the state

department are both denying speculation that president trump is preparing to dump secretary of state rex tillerson. administration officials tell us the subject has been under discussion since at least september with relations breaking down midyear. at the official line is that the rumors are not true and the men continue to work together. and its allies have agreed to extend production curves until the end of next year. to balance oil market and pull back the initiative from american shale drillers. a day of talks showed the unprecedented alliance between saudi arabia and russia which russiand and the president had said that moscow was reluctant to keep the curve going. the kurt -- the curb going. >> we elected for an amendment in january of 2018. there is going to be a when your

agreement with tweaking of the language to strengthen the eachtment to conformity by and every one of the participating countries. i can say that the discussion process around the proposed project and the declaration of operation is moving forward. time taken to the adopt this was very short. >> goldman sachs says the wild ride joined -- enjoyed by bitcoin this year. lloyd blankfein said excessive volatility does not make the cryptocurrency feel stable or have long-term value. bitcoin jumped 50 percent on wednesday before plunging more than 20% from that level and then rallying again. blankfein -- blankfein feels no pressure to create a plan. we will see.

if it works out and it gets more established and it trades like a store value and it does not move up and down 20% and it has liquidity, we will get to it. jay powell will face his confirmation hearing next week. he is widely expected to pass. thes seen as maintaining strategy of janet yellen of gradual rate hikes and says the case is coming together for a december move. he is also expected to review some of the regulations put into place after the financial crisis. global news 24 hours a day powered by our 2700 journalists and analysts in more than 120 countries. i am courtney collins and this is bloomberg. l: the senate tax bill headed for a marathon debate after republican leaders brought the measure to the floor hoping for a final vote by the end of the

week. joining us from washington with the latest is bloomberg reporter , joe. are you digging in for what may be a long night? what can we expect from the procedural vote? reporter: there has been some drama in the senate. the vote was held up for about an hour as a negotiated with the parliamentarian regarding a trigger which would have increased taxes if the growth estimates that they are based on , at the tax bill is based on, did not come to fruition. they are going back and having of theome rejiggering bill. writing in some automatic tax increases in the future. it is unclear if it would be the corporate taxes, a step up in those, or a step up in the individual rates. or a combination of those. whether it will satisfy some of the deficit hawks in the senate

is likely to cause some consternation among other senators and certainly in the house where conservatives have a little more sway on what is in the final bill. betty: what is the timeline now? before we might possibly get to a vote? it is looking like that will not come until tomorrow. sometime during the day or into the evening. they have not gotten around to --t is called the voter rama dealing with the amendments that people want to offer. they can cut off debate tonight and adjourn temporarily and come back at it tomorrow. it does not look like anything will happen tonight. looking more and more likely that it will be tomorrow. betty: is that unprecedented, joe? joe: there have been similar holdups back during the bush

administration with medicare. there were some long votes with obamacare. this is a pretty complex piece of legislation that has been put together in a very quick period. a matter of weeks versus months. such hangups are not that mayual though this one become problematic as we try to progress to negotiations with the house. you so much.hank we will continue to monitor this. joe, our bloomberg congress reporter. we will continue that tax discussion in a moment. looking ahead, the next hour of "bloomberg: daybreak asia" we will be joined by the commissioner as he attends the um and we look at his outlook for 2018. mel gohe boss for

resorts joins us to discuss his plans for japan. he wants to open a resort called the "city of the future. this is bloomberg. ♪

♪ we are counting down to opens first major market this morning. japanese futures. nikkei futures -- looks like we will see quite a big rally at the open in tokyo. this is "bloomberg: daybreak asia" and i am betty liu in new york. paul: and i am paul allen in sydney. more on the tax plan. we are joined by university of california berkeley professor of economics brad. he was the secretary deputy of the treasury under bill clinton. into somen difficulties in the senate by the look of things.

one of the potential stumbling blocks is the trigger over raising the tax rates if measures are not met. -- canfficulties can use you foresee? >> a great many. the trigger has failed the birdbath and has been removed from the bill. floor areicans on the frantically trying to come up with a substitute that is acceptable to the more deficit caucus members of their and to the more supply-side optimistic members. in a way, it is crazy. chancel still has a 70% of passing. and bill, certainly, the stock market in the u.s. thinks it has a 70% chance of passing. but, we should not be here at all. 12re are something like democratic senators who would gladly sign onto a corporate tax

cut that broadened the base and lowered the rate provided they could be convinced that it was not just another shift in the income distribution from the non-rich to the rich. and yet mcconnell is rolling forward with this republican only thing that truly is down to the wire. well, professor, let us assume that the tax cuts get through both houses. we have had a couple of fed speakers that questioned the benefit of the plan when it comes to economic growth saying that the impact will not be that big. you suggested might be a little misleading. >> the problem is that the provision expires. and a lot of the growth oomph comes from the expensing provision. if you have the expensing provision expire, you get

corporations to push a whole bunch of their investment spending into the near future while the window is opened. and then, after the window is closed, they cut back on investment spending. you are almost guaranteeing a small blue and then a small bust in the economy simply by the way your tax bill is structured. and republicans say that when the time comes around for expensing to expire, it will not. a terriblyre not trustworthy group and that would require that they maintain control of all three affect the branches of the government. which, they will not. but, it is not only the case -- that there are 12 the democrats in line for the support. there are also ways to design it that do mean it will provide a significant plus to economic growth. and yet, the group -- the joint

tax committee report that is out 0.08we are talking about percent per year. barely enough to oversee the next decade and that is for gdp, what is produced in the u.s. for how much flows into america for americans, it is a zero or almost a minus. there are benefits from rationalizing the corporate tax system. i am flummoxed that we are here. with this technocratic late bad proposal -- technocratica lly bad proposal. you don't dof like your homework until the last minute. seems to be. cannot break those bad habits. betty: i want to ask you though

we were talking to stand: earlier. in his view, this whole tax reform package is not helpful. we do not need this kind of reform. he sees a recession around the corner in the u.s. do you? >> i want to ask if my friend , mentally to be fully glued together these days. he made a career as the highbury of talkingigh priest about how the budget process runs and now that process has crashed. been extremely irate about it whenever i have spoken to him. has he calmed down? or is he still irate? betty: i will let him know that

you are questioning his sanity. "recession" is a bit strong. there is a significant minus coming from the expiration of expensing. and there is the possibility ont -- each time you load the national debt a little more, you increase potential financial instability and you add a little dangerous.ssionary interest rates are still extremely low. do benefits of this tax cut indeed come from the non-rich and do flow to the rich and those who would be financially leveraged as well. i say slower growth rather than a serious risk of recession. betty: brad, we only have about a minute. tell me your thoughts about washington andn

his testimony earlier this week. what was your impression? think jay powell is an excellent choice. he was an extremely effective undersecretary of the treasury in the george h.w. bush administration. he has been a very responsible and positive contributor to federal reserve board discussions and debates over the last 10 years. and he is a very good administrator. he is going to be a polite and affective manager of whatever the consensus of the federal reserve open market committee happens to be. the question is, is the federal reserve open market committee -- does it have the right model of the economy? in that debate will continue to roll forward. he will not be a strong advocate on any side for that. but then, if he is a consensus chairman, that is the appropriate role for him to take. betty: we will leave it there.

thank you so much. professor of economics. you can get a roundup of that story and interviews and much more that you need to know to get your go -- to get your day going. they are available on your bloomberg terminals. youran also customize settings so you only get the news on the industries that you are interested in. this is bloomberg. ♪

♪ is "bloomberg: daybreak asia." betty: a quick check of the latest business flash headlines. billabong has received a .onbinding proposal it is worth one aussie dollar a share. to a expected to lead formal approach in the coming weeks. billabong has hired goldman

sachs regarding the offer. excel -- it says it's rival is unwilling to take on the debt to complete what would've been a $10 million deal. the biggest shareholder is warren buffett's berkshire hathaway and the company has failed to seal two separate deals. betty: american airline says it is down many pilots to fly the holiday season. raising fears of thousands of cancellations. says many' union flights still do not have a full crew. american has offered 150% of hourly pay to encourage pilots to come back. who has defined global business this year?

we look at the 50 people who merit recognition and even applause. this is bloomberg. ♪

♪ a.m. friday in0 sydney, the first day of summer. warm and sticky out there. we are 30 minutes away from asia's first major market opening. betty: quite chilly here in new york that markets closing nice and warm for the bulls today. beautiful skyline there in new york. i am betty lou in new york. paul: and i am paul allen in sydney. watching "bloomberg: daybreak asia." the jobless rate for japan in october holding steady at 2.8%. the job to applicant ratio rising to 1.55.

cpi also out and also in line with expectations coming in at 1.2 percent for the month of october. everything in mind excluding fresh fruit. up 0.8% as expected. cpi coming in at 2% in line with expectations. also, bang in line at 2.8%. we are counting down to the opening in japan and south korea. >> clearly a reaction in the dollar-yen trading at 112.60. undern was already pressure on u.s. tax reform expectation and it was weighed by talk of rex tillerson being replaced at secretary of state. the yen is looking at a fourth date of losses. futures in tokyo on the back of this data. the nikkei 225 perhaps extending thursday's ain't. the kospi could also open higher

as investors have a laundry list of data to consider. asian stocks could take cues from the alleged selloff on thursday in the u.s. are takingie stocks a cue from wall street and running with it. we saw particularly banking shares flying high in the u.s. what is moving in sydney? banking shares in sydney recovering somewhat the losses we saw on thursday triggered by the royal commission but deutsche bank says the probe under this government would be less damaging to the big for banks. when you take a look at the leaders, the sectors in sydney, it is energy and health care stocks aiming the most ground. over 1% so far today. the aussie stocks could be making another stab at 6000. when you look at the bar picture, it is 11 months of straight gains.

winning 11 streak for asian stocks. it comes down to the rally in i.t. shares, still up over 50% for the year. slight concerns though that the rally may be petering out there. the inflows to hong kong hit a record for the month of october -- for the month of november. the hang seng is expected to hold 30,000 in the month of november. they might markets performed poorly over concerns of a bond rout. -- those markets performed poorly over concerns of a bond rout. -- thisrchant banks does not look like a reversal of the downward trends for chinese bonds. betty: thank you for the early look at those markets. let us get the bloomberg first word news. first up, the republican tax

plan looks closer to becoming law after senator mccain indicated his support. gop leaders continue to work on winning over a dwindling number of holdouts. debate over the legislation may continue into friday morning washington time before ending the unlimited amendment period. trump administration is calling on other major economies. washingtoncomes as seeks asian help in corralling north korea and follows a period where the president scaled back his public criticism of china. the treasury is concerned that recent economic liberalization has slowed or even reversed. >> they are putting too many of their marbles in state owned enterprises, in the party structure. -- we know that what

they are doing is not working for u.s. workers. that is the impetus for the change. >> chancellor merkel has held her first meeting with the social democrats in an attempt to form another partnership. this comes two months after the inconclusive election. spd leaders were initially wary reviving the grand coalition after both parties emerged from the vote in a weakened state. the uk's efforts to compromise the irish border is under threat. democraticeland's unionist party is opposed to any compromise with dublin and says it will abandon may if necessary. and i respect him as spokesperson says the u.k. still has not produced a net progress on the border issue. the eu has set a monday deadline for may to deliver.

the mass shooting in las vegas in october led to a fall, a 4% fall in visitors. open formained business after the shooting on october 1 casino operators stopped operating for more than a week out of respect for those killed and injured. and gm says bookings are starting to improve. mgm says bookings are starting to improve. global news 24 hours a day powered by our 2700 journalists and analysts in more than 120 countries. i am courtney collins and this is bloomberg. its: south korea underlined strengthening economy with third-quarter gdp expanding more than expected. throughame in at 3.8% september. inflation however slipped slightly after a bank of korea dissenter expressed concerns about sluggish prices. the chief of north asia correspondence, steve engle is

here. it is interesting because the gdp number was widely expected to show 36% but we got three point 8% which matches the first quarter of 2014, the fastest space of growth since the first quarter of 2011. the inflation number was key as well for the rate decision yesterday to hike. that the paceaid of inflation was creeping up toward the 2% target and it had been. cpi was about 1.8% the previous month. core inflation was just 1.3% when you strip out food and energy. these numbers that came in significantly below that as well kind of fits right into that loan dissenter -- lone dissenter's on the be ok board.

bok board.th i was looking down the sub indices of the various components of cpi. all the major components rose month over month and year over year except for recreation and toture which could be tied the significant drop-off in tour is them in mainland china. betty: steve, what are we expecting though? expect from the numbers coming out of the top of the next hour? steve: a return to double digits. dippedvious month, it

down to 7.1%. we are expecting it to come back to 10.3% for november. halloween nine consecutive months in double digits september.5% pop in there were some aberrations because of holiday distortions. the export machine has been driving the south korean economy to that growth in the previous quarter and driving the wan. up 11%. the best performer against the dollar in asia. and even yesterday, the bok indicated the semiconductor cycle, a big part of the economy with samsung, is still going strong. betty: steve, thank you so much. our bloomberg chief north asian consultant. code to global business in 2017? bloomberg's reporters and editors around the world put together a list of 50 people worthy of recognition.

on businessweek's special issue. bloomberg 50. joining us now is brent. the names which include everyone from nikki haley to others. how did you get to the bloomberg 50? polled oure editors across the world to say that this person has to do -- has to have done something spectacular in 2017. we had to establish that they had done real work in 2017 and there had to be a numeric underpinning. a quantitative measure. betty: give us some highlights of some of the more unusual names. >> one that i loved was geoffrey hinton. year 70 years old and this , in canada, they announced the

construction of a 100 million dollar institute for artificial intelligence research. if you have ever fired up an autopilot on a tesla, it is because of research that geoffrey hinton did starting in the 1980's. someone like anthony tan, also in southeast asia. when we started doing the reporting of this, his company grab was in 87 cities. and by the time we went to press, it was in more than 140. paul: you have done some great work putting this list together, but who can we look out for in 2018? >> james jeff yeah. he founded supreme in the u.s. and around the world. streak label. hot the carlyle group took a 50% stake in this which allowed them to expand more internationally. keep an eye on him.

and i think other people you want to keep an eye on our in the sector of millennial's and online shopping. you have people that are doing -- for millennial's and across the board in car and self driving cars. there are so many people getting into this business. thank you's much for joining us. don't forget to check out bloomberg businessweek's specialty dish and, the bloomberg 50. the people that defined global business in 2017. up next, do tech stocks recover? -- we will speak to michael about his outlook for next year and how tax reforms they affect the industry. this is bloomberg. ♪

betty: we are counting down to asia's first major market opening this morning. japanese futures looking pretty bold here in tokyo. just about 15 minutes until then. this is "bloomberg: daybreak asia" and i'm betty liu in new york. paul: bitcoins wild ride this dramatic highsn and equally remarkable declines. we saw one just 24 hours ago. after hitting a thousand dollars in trading it has dropped to 9500. the fed watchdog said they are far from embracing bitcoin currencies pointing to the why pointing to the wild volatility. as you weresting, talking, the price flipped up

and down that psychological 10,000 line showing the gyrations and that is what is giving investors pause. some nobel laureate saying the rise and- saying the fall of this reminds one of the great depression. let us look at the lifetime of the bitcoin. we are here right now, but it 2010.art up in we can see the gyrations that we have been seeing on the order of about 10% or 15%. it does not compare to what has happened in the past. look at 2013 for example when bitcoin jumped by as much as 100% and then fell again by as much as 100%. in 2011, in its infancy, up by 130%. let us go a little further into the past two weeks. that long timeline compressed down to the last two weeks.

the 17% jump happened when the cme futures reporting came out related to december. november 29. 3% but itust a pop of was at the close and it does not talk about the gyration intraday. it was up and down by as much as 20% on this day. november 30, down 6%. at the close, down by as much as 11%. to my next bloomberg terminal charge. we are talking about this bubble. is it a bubble? with that said, look at the last bubble we had with bitcoin. we have been here before, guys. this is where we are right now with regards to the bitcoin praise. i must exactly four years ago, this is where we were. plus 20,000% over two years from 2012 through 2014.

right now, we are up only about 20 -- 2000%. from 2016 through 2017. deja vu all over again. couple, athere were a couple, stocks that actually beat bitcoin. four to be specific and they were all in asia. look at the white line. the china investment fund in hong kong up 1333%. one in hongother kong and another in india. if you were smart enough, you may have beat bitcoin. is like picking needles in a haystack. year,head toward the new the new technology such as augmented reality and voice activated personal assistant.

the tech outlook came out highlighting what to watch in technology. i want to bring in the cofounder and ceo, michael. what about bitcoin in 2018? michael: right now, bitcoin is a speculation phenomena. --re it becomes important is is it really a currency along with the other cryptocurrencies? incrediblybeing an efficient vehicle for payments of across borders, for trading in goods. in a speculative phenomenon. i would not be surprised if it rises and falls. where it gets more practical is where is it being used? betty: the wild volatility. that is a deterrent to it being more widely adapted. look atvery time you cycles of inflation and deflation, we are seeing that in real-time with bitcoin.

stable, people will be able to use it. and once there is a market where there is not just liquidity from trading but vehicles where i can buy something or pay for it with bitcoin, it becomes much more valuable. betty: that is bitcoin. i am sure a lot of people are looking at that but what are some of the big trends that will be different in 2018? , first ofe will see all, the digital assistant. alexa and siri -- they will all break free from the speaker. year,, we think that next towards the end of the year, we will hit peak speaker. the speaker sales will peak -- betty: they have only just begun. michael: but more and more, the digital assistant -- who gets to own the front end of really

artificial intelligence -- all of those systems will be embedded in your tv, refrigerator, and car. if you look at the price of the digital assistant, the prices are already falling. to the point that just last week, the google or the echo. -- they were just around $20. that is one trend. the other is that we will see a huge explosion around augmented reality. we look at virtual reality with the oculus rift in the other headsets -- that is not going to take off. the prices of those are dropping but the usage is not rising. augmented reality which is what people are getting used to. using their phones, iphone or use augmented reality applications. we don't think it will just be about consumer applications but

enterprise. that is where this is linked to become an enormous business in the next couple of years. and finally -- consumers will spend more time using tech and media. paul: michael, you mentioned a turf war among these tech giants. that could spread into other areas like entertainment, movies, and sports. how damaging do you see this turf war being if it happens? think it will continue because each of the major technology companies believe it needs to be in the entertainment business. theirre all ramping up spending on original content. they are all spending more on distribution. we have apple which has said it will put a billion dollars into entertainment. spende netflix which will

$6 billion next year. and we have facebook which has launched this one tab, the watch tab, and they say they are also preparing and producing television programming. it is going to be a battle. a war. what is driving it is the huge amount of money that people are spending today, not just on advertising, but the amount of people people are spending to get television in their homes as well as paying for video. the cofounder and ceo, michael. thank you for joining us today. don't forget our interactive tv function, tv or you can watch us live and catch up on past interviews as well as dive into any of the bloomberg applications that we talk about for you can also send us messages during the shows. this is for bloomberg

subscribers only. check it out on bloomberg tv go. this is bloomberg. ♪

♪ this is "bloomberg: daybreak asia" and i am paul allen in sydney. betty: a quick check of the headlines. telstar is cutting its four-year headlines. it is now expecting a $600 at the end of june and a countrywide broadband network is being rolled out. the company said the latest delay only affects the current year. said to becom is delaying its support of qualcomm until next year. it does not anticipate raising the bid until closer to qualcomm's board meeting in march however it does plan to

nominate directors on qualcomm's board next week. qualcomm, meanwhile, is facing opposition to its support of a bid for --. health jumped the most in 15 months after reports that it has agreed to a deal with at no. -- with aetna. bloomberg has been told an announcement could come as soon as monday with cvs likely to pay at least $200 a share for aetna. 30% of that would be in cash. bsp looks like this in sydney. the joint venture with the company in brazil. he could not agree with the terms. we are told another option is to divert waste into a nearby valley while a new dam is built.

coming up in the next hour, we ,ad the european commissioner who joins us on ahead of his speech in hong kong. this is bloomberg. ♪

♪ betty: asia-pacific markets look like they are starting december on an upbeat note after new highs on wall street. paul: tax optimism is playing a role. 24,000 after john mccain shows his backing for the republican bill. betty: rate hikes. saying,ed jay powell in the cases there. paul: the goldman sachs tells bloomberg this year's wild ride

with bitcoin means it is too early to say. betty: this is our second hour of "daybreak asia." i am betty liu here in new york. paul: i am paul allen in sydney. we have breaking news. export numbers for korea for the number -- month of november, weaker than expected, 9.6%, year on year. the market was expecting 10.3%. wheres weaker at 12.3%, 13.3% had been forecasted. 7.84 billionance, dollars, the market was expecting 8.4 billion. these numbers coming after reasonable gdp figures, slightly disappointing inflation data. trade balance for south korea billion,mber, $7.8

exports coming in weaker than forecast. betty: we have seen how much exports have propelled the south korean economy so far this year. let's get to the first word news with courtney collins. >> the white house and state department are both at denying speculation that president is preparing to dump secretary of state rex tillerson. officials tell us the subject has been under discussion since september, with relations breaking down the since midyear. the official line is that the rumors are not true and the two men continue to work together. opec and its allies have agreed to extend production curves until the end of next year, the balance the oil market and wrest back the initiative from oil drillers. it was an unprecedented alliance between saudi arabia and russia, who can't founded analysts. they said moscow was unwilling to keep the curbs -- curbs

going. >> we elected to call it in 2018,ent in january through december 31. it will be basically a one-year agreement, tweaking the language to strengthen the commitment to conformity by each and everyone for participating countries. the discussion process around the proposed subject was straightforward. the project presented by a group of ministers was accepted by most. the time taken to adopt this was very short. >> goldman sachs says the wild ride enjoyed by bitcoin this year means it is too soon to lay out a strategy. by blankfein said excessive thetility does not make cryptocurrency stable or have

long-term value. , after dropping 20% and rallying again. says -- >>nkfein something that moves up and down 20% in a day, we will see. store ofdes like a value, and there is liquidity in it, we will get to it. >> bitcoin is not the only stock on a high. these four lesser-known companies have dropped -- jumped more than 1000%. risennese steakhouse has to $1 billion this year, pepper food. heg makes electrodes to turn a scrap into steel. , and also china investment. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries.

i am courtney collins. this is bloomberg. betty: let's get back to the markets and how asian markets are trading, as we open in tokyo and south korea. sophie kamaruddin has more. >> after the dow cruised to 24,000 and u.s. tech stops -- we have seen them kickoff december on a more cheerful note. tech stocks gaining ground in tokyo and seoul. the nikkei 225 rising 0.9%, the kospi rising 0.33%. it has already been a busy friday with data from japan and south korea. we are seeing the yen barely budge after japanese inflation rose. third quarter business spending rose more than forecast. the dollar little changed as the

market awaits next steps. the korean won still on the rise. levelthat the strongest of 2017 on wednesday. third-quarter gdp, the final read revised higher. cpi missed the estimates, exports rose less than forecasted. we saw new york crude hold. opec extended cuts through 2018. it is a bit more of an optimistic mood through december. paul: let's get back to the u.s. senate, where republican leaders are aiming to get their reform bill passed by the end of the week. it has been held up by a series of divisions and delays. jodi schneider joins us from hong kong. what is the latest? how are republican leaders trying to get it over the finish line? wouldy are very badly

like to get to a vote in the next day or so. they have to consider a lot of amendments, it is called a vote-a-rama, where they vote on a string of them. but there are still divisions. , aredo not want to see concerned about the effect of this will have on the budget deficit, how much it will cost. $1.4 trillionare over 10 years. they have to get this to comply with budget rules, and that is tricky. susan collins of maine, a moderate republican, is concerned there is not enough for the middle class in this, and the effect of having the repeal of a key part of obamacare, the individual mandate, in this bill. they still have to sabotage some republicans in their caucus to get this passed. they can only afford to lose two republican votes, because no democrats are expected to vote on it.

betty: a razor thin majority. support for the bill now, how important is it? jodi: that was a key obstacle. he surprised everyone with his no vote, his famous thumbs down, on the health care bill. that basically bottled it up in the senate. they could not get it passed because of that. now he says he will vote for the tax bill. it is not the final hurdle. they have more republicans to satisfy, given the razor thin margin may have. but this is key. he is saying he will vote for it, means it is one less worry republican leaders have in getting this past -- passed. paul: there are many more hurdles to come. the if it does get past in

senate, there are plenty of other obstacles as well, aren't there? jodi: reconciling this with the house will not be easy. they have to pass the exact same bill in both chambers. the house bill is different than the senate bill. how will have to deal with they deal with state and local taxes in the senate. they would not have an exemption for them, there were limits in the house bill. there will be tough negotiating. they are up against the clock. if they want to get -- get this done by the end of the year, there are not many days left on the legislative calendar. paul: could be a late night in bloomberg editor jodi schneider in hong kong, thank you. we will be examining whether opec's agreement to extend production cuts will be enough to raise oil prices. our guest joins us in around half an hour. betty: an in-depth look at the

challenges of sweeping new financial regulations across the e.u. those are coming in early january. we will be speaking with the european union vice president.

paul: this is "daybreak asia." i am paul allen in sydney. betty: i am betty liu in new york. financial firms are facing an uphill battle, for the vast overhaul of european trading rules. it comes into force next month. many are calling it a soon on the of regulations that benchmarks will have to comply with. topnext guest is a financial services official for the european commission. he rolled out an extension of the january 3 deadline. valdis dombrovski joins us now from hong kong.

thank you so much for joining us. there has been a lot of talk about whether or not to extend this deadline. how confident are you exchanges around the world in the u.s. and asia will be able to comply with mifid rules. good morning. as of january 3 next year, the rules are entering into force, or mifid ii. the industry needs sufficient time to prepare. date has been for -- postponed already once. they are getting ready for implementation. what we're doing here is implementing international commitments, g20 commitments, for our trading obligation, increasing transparency, consumer protection, basically

implementing what has been agreed internationally. betty: there is a desire and the goal. but there are lots of reports on bloomberg and elsewhere that the , as they see how complex some of these requirements are, are having a difficult time seeing whether that january 3 deadline will be feasible. how are you going to smooth out that transition, if there are significant disruptions? we are currently also working to make sure all practical preparations are in place. the industry has done when we, during a time have already extended the deadline once. still emphasize there was sufficient time for preparations. we are ready to work closely with industry to ensure there is

a short introduction. [indiscernible] preparing necessary decisions. officialse e.u. warning against granting equivalency to alternative trading systems here in the u.s., for instance. i am curious what your stance is on that? you had several of your colleagues write in, warning against granting that equivalency. in asia, are some of these trading venues going to be granted that equivalency by january 3? currently working on those equivalents decisions. i cannot comment on a detail of each decision. extent aim is to the

possible, by december. curious, you mentioned you moved the deadline once already. you are working with partners to make sure everyone is ready for this. shove, would to there be willingness to move the deadline again? valdis: they are currently not moving the deadline, since it is set in e.u. legislation. we want to work closely with industry to make sure it is a smooth transition. we are able to react if some difficulties arise. plenty -- paul: there are plenty of other e.u. considerations. are you confident a deal on the exit bill and the irish border can be reached by next week,

another deadline for you? as you know, brexit conversations are reaching an intense stage. the aim is to achieve what is called sufficient progress in the first three issues. citizens rights in that u.k., u.k. citizens rights in the e.u., and the irish border. hopefully we will be able to report more progress. what really matters is the substance of the agreements. as the european commission, we will only be able to report significant progress to the council, if there will be substantial agreements. the u.s. is concerned about regulatory developments in the e.u. after brexit. one is about access and how it will affect countries.

do you have specific concerns to asian trade partners as well? ,aldis: i am here for e.u. asia-pacific dialogue, which is about to start, to discuss how we can further our corporation and ensure global integration of the markets. opense we are very [indiscernible] on equivalencies. the e.u. has been open in recognizing their country rules as yielding the same results. we hope this will continue. betty: i want to switchgear's and talk about a topic that is of the moment in the financial markets. that is bitcoin. i want to get your view, from a

regulatory point of view, on bitcoin. valdis: from a regulatory point of view, as you know, we do not treat bitcoin as a currency. there is only one currency in the eurozone and that is the euro. it is rather to be treated as a commodity, where the price is determined by demand and supply. we are not commenting on the price at the moment here. betty: i understand that. but my question is more, are you looking at this, do you believe it is something you may eventually have to regulate? we are looking at bitcoin and other currencies from another angle, from that angle of anti-money laundering. we have already put the virtual

currency holders, the virtual currency wallets and so on, they're helpful at reporting the requirements, so law enforcement can reach the data on those digital currency transactions, if there is suspicious -- suspicion of money laundering. paul: if i can just talk briefly about greece, we have not heard from them in a while. i you confident they will get full market access from august, as planned? or will there be need of yet another bailout? workingwe are currently on the big programs. a third program is ongoing. it must be said that broadly speaking, things are on track area -- track.

it is over achieving its fiscal targets, also. next year's budget is being prepared, with respect to the primary surplus target of 7.5% of gdp. after successful completion of the third review, which we hope can be done in a short time, we will need to start preparations for the successful conclusion. i would say all the preconditions are there, that we could actually complete the program as seen in august. after which, greece could return to the market financing. paul: not just greece, but some of those other countries in the eurozone that are carrying some pretty high debt. have any concerns, once interest rates begin to normalize? valdis: that is exactly the reason. if you look at our priorities,

it is to stimulate investment, increasing competitiveness, and fiscally responsible policies. fiscal responsibility is the point we are making, with member states. especially those countries that held high debt levels, because there are deficits and debts on a downward trajectory. it is said it is already happening. our budget deficit in the euro area already next year is expected to be below 1% of gdp. clearlypublic debt is on that trajectory. [indiscernible] are in a fifth consecutive year of economic growth. it is important that debt and deficit levels continue to be reduced. betty: i have one last question, i want to get back to bitcoin,

because i know it is on the minds of many people. bitcoin is that these record highs and there are concerns that if it crashes, it might destabilize the financial markets. are you worried at all that bitcoin, if the bubble bursts, that it could jeopardize financial security in europe? all, we are not with regardsting to bit going. we see it still as a relatively limited phenomena. what we are more looking at to reportingre are requirements, should there be a need to track those transactions. is the what i would say angle we are assessing with bitcoin. betty: thank you so much for joining us, valdis dombrovski,

the e.u. vice president in hong kong. you can find in-depth analysis and the day's newsmakers on bloomberg radio. app,an download the bloomberg radio plus, or access it via bloombergradio.com. this is bloomberg. ♪

paul: a quick check of the latest business flash headlines. call it "harry potter and the disappointing sales." a sharp drop in sales last quarter. it is putting the blame on the young magician because 2017 did not have the boost of a new book, unlike last are with "the cursed child." barnes & noble said the sales fell 8%, fueling a loss of more than $30 million. , they jumping in tokyo

said their rival was unwilling to match the perceived value and take on the debt needed to complete what would have been a $10 billion deal. their biggest shareholder is warren buffett's berkshire hathaway. they are said to seal two separate deals this month. paul: american airlines it said it has found enough pilots to fly most of its planes this season, after scheduling glitch created the fear of thousands of cancellations. but many flights to not have a full crew, and american says it has offered 150% of hourly paid to it -- encourage pilots to pick up the slack. cleveland fed president says u.s. consumers are holding up well. we will hear from her. this is bloomberg. ♪

paul: it is 8:30 in singapore. we are half an hour from the open of treating their. i am paul allen in sydney. betty: i am betty liu in new york. you are watching "daybreak asia ." senate republicans are scrambling to salvage their tax proposal after a key compromise collapsed. rule makers rejected a so-called trigger proposal, designed to win support. at least three holdouts had tied their votes to the mechanism which would have raised taxes automatically, if revenues were not met. john mccain indicated his support. he helped scuttle the appeal this year.

the trump administration is asking for other economies to offer a response to china's slow embrace of market principles. washington seeks beijing's help and corralling north korea and follows the period where the president scales back his public criticism of china. the treasury said it is concerned recent economic liberalization has slowed or even reversed. >> they are putting too many of their marbles in state-owned enterprises, in the party structure. we know what they are doing is not working for u.s. workers. that is the impetus for the change. >> chancellor merkel held her first meeting with the social democrats, in an attempt to forge a new governing partnership. the talk happened more than two months after germany's inconclusive election left merkel short of a majority.

they were wary of bringing back the coalition, both parties emerged from the vote in a weakened state. a compromise on the irish border, under threat from the party that supports theresa may's government. northern ireland's party is opposed to any compromise from dublin, and says it will abandon may, if necessary. an irish government spokesman said the u.k. has not produced enough progress on the border issue. the e.u. said a monday deadline for may to deliver. global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. i am courtney collins, this is bloomberg. paul: thanks, courtney. time to see how asian markets are shaping up. we have had reassuring data out of japan. a mixed bag out of south korea. here with more is sophie

kamaruddin. sophie: a busy friday already. thented kick off with aussie dollar 0.7%. the survey is due out later this morning. they are betting on an aussie rebound, just not any time soon. the downward momentum is easing. we had mixed data out of south korea. the korean won, investors considering the latest data dump. than forecast,ss although gdp did strengthen in the third quarter. that rose upward for south korea. the yen little changed under pressure as risk appetite is reemerging. inflation sticking below target for japan. japanese stocks climbing for a third day. you have energy and materials leading gains. the nikkei 225 eyeing 23,000 points. checking on nippon paint,

jumping the most in over a year. ended come up but they are still on the lookout for an m&a deal. sharp jumping as much as 8.1% earlier. join the tokyo exchanges on december 7. looking at the crude, the sunrise stocks, recovering from thursday's drop. another rising the most since october 12. kansai electric is slipping. betty: thank you so much. japan's inflation rate may be moving higher, at a glacial pace. but today's news on prices shows it continues to move in the right direction. bloomberg's global and economics policy editor kathleen hays with a look at those numbers. another fed official endorsing

what paul said. kathleen: absolutely, the coalition is forming rapidly. let's start with japan and look at these inflation numbers. i am an optimist, to me the glasses almost half full. what inflation is doing, the key rate is almost half way to target. take a look and see what i mean, g #btv 7942. here is the 2% inflation target, here is the latest reading on core cpi. see that nice, steady climb? it may take a while to get here, but it is moving in the right direction. one of the reasons could be the tight labor market in japan, g #btv 4596. the job applicant ratio is up to 1.55%. and the unemployment rate is low. to get that kind of rate, you have to go back to the mid-1990's.

to get that job to applicant ratio, you have to go to the 1970's. pretty nice numbers for japan, for a tighter labor market, eventually boosting inflation. 4.2%, it wasing up surprised -- supposed to rise over 1.2%. the boj meets january 22 and 23. they are getting more positive signals on the way to that meeting. betty: breaking news on two separate fronts. president trump's nominating yelena nick williams -- mcw illiams. on the previously been senate banking committee. she is currently the chief legal officer of a bank. she is being nominated by the president to become the next chair of the fdic. on the tax front, mitch mcconnell, the senate he

majority leader, saying the next four votes will be held at 11:00 a.m. tomorrow run --sobczyk had , this is notus going to happen tonight. the vote is going to go into tomorrow. the next four votes will be held at 11:00 a.m. tomorrow, that is friday in the u.s. area kathleen: -- the u.s. kathleen: a republican was fierce on the banks, it will be interesting to see what mcwilliams is like. betty: trump is putting all the pieces -- all the pieces in place. the cleveland fed chair endorsing a rate hike in december. kathleen: just like jay powell, the incoming fed chair. let's listen to what loretta mester said earlier today in washington. case for been on that

a while, we need to be moving interest rates up gradually, given where the economy is. growth is that a sustainable pace. labor markets continued to improve. consumer spending slowed down in november. let's look at inflation. g #btv 6897. here is the fed's 2% target. you will see the key measure, the core pce, is up 0.1%, year-over-year. nevertheless, she is ready to move. another said the fed would be wise to take a step on tightening in the near future. even some who have been moderate in the past, finally getting more thoroughly on board. andquestion will be 2018,

if that inflation shortfall makes more of a difference than. then.n -- bitcoin, the wild ride has seen dramatic highs. equally remarkable declines after hitting a $11,000 this week in asian trading. it slid to $9,500 in new york. the feds bank watchdog said policymakers are far from embracing cryptocurrency, and this volatility we are talking about. is remysense of it inocencio at the wall with bloomberg charts we need to know. sounds like i am in a bitcoin storm. with all the ups and downs it does seem especially for investors getting pushed here and there. take a look at g #btv 6021. these are the ups and downs a

bitcoin over the life of the cryptocurrency, starting back in 2010. 70% upbeen as much as earlier this week, and down by as much as 6%. you think that is volatile? happeningat has been since 2013, when it went as high as nearly 100%, and as low as 50%. in 2011, uptions 137% there. it looks fairly tame, relative. this is also the same terminal chart, but just for the past two weeks. we can see where that pop when they said they would do cryptocurrency for the end of this year. not terrificnd 30, or amazing ups and downs. but intraday, it was large.

november 20 nine, this was as high and low as 20%. november 30, the closing date today in the u.s., it was as low as 11%. we are pushing for percent -- 4 %. take a look at where this is, relative to the last bubble we saw. a shout out to our bloomberg 4033 --g crew, g #btv #btv 4403. we were in a bubble, four years ago, to the day. it is interesting to see it had popped by more than 20,000% from a year and a half ago. during this time, it is not as much. but looking at where it is, we are still being blasted with a record high of 11,000.

just crossing 10,000 right now. those are the terminal charts you need to know. cany: it seems like nobody not say something about bitcoin. everybody has an opinion. lankfein ofh is b goldman sachs. up andthing that moves down 20% in a day does not feel like a currency. we will see. if it works out in gets more established and trades like a store value and does not move up and down 20% and there is liquidity in it, we will get to it. betty: sounds like for many folks, ink quoting -- including lloyd blankfein, it is speculative. we spoke to a tech consultant who said it is, it does represent a new wave of buying

and selling. maybe wall street has to wake up to what these tech strategists are saying. paul: there was a lot of interest in the blockchain technology behind this. but in terms of the currency, perhaps not so much. valdis dombrovski says the e.u. does not consider it the currency, but a commodity. another weight in with one of my doesite questions, when this in pinch on the sovereignty of nations? let's take a listen. authorities at the global level have not yet focused on the dangers of the development of this scam. when they do, i think some people will get hurt. it was a new invention to lose money. betty: you have been warned. paul: scam. we have not even talked about

electricity usage. they estimate one bitcoin transaction uses as much energy as the average american house in a week. could that have a future? betty: you might be wanting to buy electricity futures, given that, energy futures. paul: could be. plenty more to come. and its in arms, opec allies agree to keep production cuts in place until the end of next year, as they battle to take control back from u.s. shale producers. details from vienna. this is bloomberg. ♪

♪ is "daybreak asia." i am paul allen in sydney. in newi am betty lou york. opec and allies agreed to extend oil cuts until next year.

the decision was announced after talks in vienna. it signals the strength of the new alliance between the world's top producers, russia and saudi arabia. we have this report from the austrian capital. as the meetings draw to a close here in vienna, opec in position to extend the agreement with an non-opec for production cuts for 2018. you are looking at january 1 to december 30 1, 2018. they expected a nine-month extension. libya and nigeria will be asked to be part of the agreement. not with cuts or curbs, but budgets. they will not increase production beyond current levels, 2.8 million barrels per day. the group will meet over the summer to review progress and what they call, recalibrate, according to market realities. what we did not hear was any it will be wound

down once they feel inventories have come back to an accessible level, which so far has been a five-year average. yousefhat is bloomberg's in austria. let's bring in our guest from jpmorgan. the deal is struck, the production curbs extended. the u.s. reports a surge in domestic production, bringing the total to 9.48 million barrels a day, the highest since the 1970's. in that context, will production cuts be somewhat blunted? >> it is a very good question. , a few weeks back we had a shale names of their. said $60 wti, which is

roughly around where we are at the moment, shale could grow to one million barrels a day. not just for 2018, but beyond that. , we arethe agreement seeing gradual rebalancing of the oil market. i think the agreement was not so much of a surprise. we could see in the year term, after the initial euphoria when they drift down, as we start the new year. thinkwhat price do you u.s. shale becomes [indiscernible] scott: i think there is a broad range of breakevens. so points around the 30's or . we did a big technology tour in houston. the key message i got from our team in the u.s., there are still productivity gains to be

had through shale. if these prices are supported around this level toward $60, i still think you have got shale growth, which cap's upside to oil prices. the opec nations are heavily dependent on oil exports. production cuts, surely weighing on these countries. does the price boost gain from cuts, is it enough to increase output? scott: if i look at saudi arabia, jpmorgan has done a lot of work with saudi arabia, the key for saudis is to diversify their economy. saudi around this oil price level is comfortable. any higher, you incentivize delay subsidies in the kingdom.

any lower, you get more social, economic issues in the kingdom. arabia,are with saudi it is a weak spot. curious, given these 2018,uts into the end of what do you think of the global oil -- who will outperform and who will underperform? if we have the near term oil weakness as we start the year, i think investors should be positioned more with those names. reflect somerkets of those. you see australia, and hong kong. they are the ones i would watch. if we are at a level sustainably around the mid-60's, something

where constructive around. a look at refining stocks, which have really sold off recently, around macro concerns, as well. before we go, and kerry is how you think this will affect the u.s. shale industry, given these extensions. i think it is supportive because you have price support at whatever level next year. we did work recently for the small-cap stocks. 40% are hedged already. certaintylittle more to spending plans as we go to 2018. and also in production outlook. thank you so much, scott darling, head of regional oil and gas at j.p. morgan. after the news of the opec oil cuts that were wild -- were widely expected.

bloomberg subscribers can go to dayb on their terminals. you can customize your settings to only get news on the industries and assets you care about. this is bloomberg. ♪

♪ lively senate a

floor, not too late into the evening. but it has been a long debate, since 10:30 this morning. debate on tax reform continues. voting on the tax bill has been a.m., on until 11:00 friday. we thought we might get that voting as early as tonight, even if it might stretch into the early morning. but instead, they will be adjourning at some time after the debate and coming back to restart friday morning. postponed.a-rama they made it sound fun, didn't they --vote-a-rama? wait 24 hours to see the outcome of that vote, and the debate, as well. let's get a check of the business flash headlines. qualcomm facing a new hurdle in its $47 billion bid for

semiconductors. it is close to securing regulatory permit -- approval, but not getting support from stockholders. they collectively owned more than 20% and want to press qualcomm to sweetness offers. qualcomm is trying to defend off

>> it is 12:00 p.m. in sydney. 9:00 a.m. in hong kong. i'm haidi lun and this is bloomberg markets: asia. asia-pacific markets start the last month of the year in positive moves. stock are supported by tax optimism. new highs on wall street. brothers in arms. saudi arabia and russia stand together as opec extends the curve to american shale producers.