>> coming up on bloomberg best, the stories that shaped the week in business around the world. investors on edge around the world. >> headlines about trade war, emergency powers. between that and the tech selloff, there is all this drama unfolding. >> tech takedown. facebook fallout continues as pressure mounts on mark zuckerberg. >> if i'm the right person to answer these questions, i will do it, but i have to be the right person, zuckerberg said. congress said you are the right person. >> autonomous driving faces a gut-check. >> nothing is more important to us than the safety and the brand itself.

>> -- low confidence in consumers and regulators alike. >> around the world, u.s. standing with allies in giving -- the boot. kim jong-un pays a surprise visit to china. haggling over trade. >> i think this could be very disturbing. >> i think -- i hope the temperature will be taking down -- taken down on both sides. >> imf managing director tells europe to get it together in the capital market. >> they came to close accountability, but it is still short of what is needed. >> this is all straight ahead on bloomberg best. hello and welcome, i'm abigail doolittle.

this is your weekly review of the most important business news, analysis, and interviews. let's start with a day by day look at the top headlines. western allies uniting to punish russia for the nerve agent attack on the spike in the u.k.. >> u.s. coming down on russia in response to that -- the european council president said that 14 eu countries will expel russian diplomats. >> the white house has taken action to retaliate to the poisoning of a former russian spy in great britain, ordering russian diplomats to leave the u.s.. >> -- been looking forward to seeing positive corporation. instead, they got these expulsions. i think the kremlin is going to

respond in kind. at the same time, i think it has lost more hope that they can find a way to work with donald trump after so much hope was expressed after his election. >> there is no shortage of superlatives for the game today. s&p 500 making its biggest one-day gain of august since 2015. -- biggest weekly selloff in two years. >> the trade issues, broadening of trade. it was not just tariffs, it was wider, the fear that this would become more significant. it almost got to the point where people would suggest that president trump was no longer progrowth, pro-business, but was the problem. that narrative changed.

over the weekend and this morning, wait a minute, the chinese are going to work with the americans on tariffs. >> asian stocks following the united states -- remember those words from steve mnuchin, who said he was hopeful that a deal could be reached with china? we understand that president trump is trying to get the chinese to reduce tariffs on imported cars, to open the financial services industry. this is starting to look more like the art of the deal. >> global equities are higher after u.s. indices surged. >> we had volatility, two pullbacks this year. from this starting point, a bit of a rally, i think credits could go higher before we get the next pullback. >> stocks lower into their close. nasdaq down nearly 3%, whipping back from the gains yesterday. a volatile day, risk off rally continues. >> what has happened over the past few days, a big stock selloff and a comeback.

today felt different. critical yield levels, 2.8% at the 10 year broke. i think that was the last straw for people who are traditionally risk-off investors. i think it is really just capitulating to the volatility we are seeing, headlines about trade war, emergency powers. between that and the tech selloff, there's a lot of drama unfolding in markets. abigail: around noon, the nasdaq started to take lower, -- to tick lower. last week, the nasdaq 100 had its worst week since august 2015. on a daily basis, none of those days were as bad as today. so the sellers are out. it makes yesterday's rebound rally look like a dead cat bounce. >> mark zuckerberg has decided it is time to face the congressional music. he will appear before u.s. house energy and commerce committee to answer on facebook's role in the cambridge analytica data scandal, according to a

congressional official. the decision to appear's -- to appear before congress has not helped facebook stock. it has dropped four percent in trading tuesday on top of the $90 billion lost facebook has seen since the scandal broke. what do we know about his appearance and what will he say? >> we know zuckerberg has come to terms with the fact that he's going to do this. he said last week, if i'm the right person, i will do it. i have to be the right person. congress said uhh, you are the right person. we want to hear from you. >> asian markets -- if you take a look at the sector breakdown, really continuing to be tech that leads the losses. -- was a quiet company.

>> things really being hit -- fangs being hit. twitter, facebook, concerning news out of nvidia. >> technology leading the way, but in this case, leading the way up and down, kind of all over the place. nasdaq off by .8%, .9%. a mixed bag. >> you look at trading action today. if you told me the curve would both latin, we would get the -- would bull-flatten, the bank index would hold up. tech stocks selling off. i think it speaks to how localized this is in terms of a re-rating of tax. >> russia will expel 60 u.s. diplomats and close a consulate

in st. petersburg, a reciprocal action. >> we saw the u.s. kick 60 russian diplomats out of the u.s., and russia responding in kind. there are now something like 20 countries with sanctions against russia for what happened in the u.k.. you see this sort of broad-based response here. a couple interesting points. the president and this white house want to take credit for helping bring other countries on board in solidarity with the u.k., and that could mark a shift in how publicly the president is willing to push back on russia. >> we got some last-minute

of trading, with indexes peaking around 3:00 p.m.. nasdaq closing up 1.6%, still remaining the best performance year for the day. >> volatility has repriced, valuations have come down. i think -- is a lot better now than three months ago. ♪ >> still ahead, as we review the week on bloomberg best, an exclusive conversation with the imf managing director, christine lagarde. >> many elements are -- standardized documents, to the entire markets. they need to go further. >> first, more of the weeks top business headlines. will restructuring solve deutsche bank's problem? ♪ >> first, more of the weeks top

>> this is bloomberg best. abigail: let's continue our global tour of the week's top business stories with china shaking up the world's future market >>. >> the global oil market getting a bit of a wake-up. china's earned oil futures, -- the world's largest oil consumer, -- for chinese commodities. the question, does this mean china will get a bigger say in pricing? >> this is a massive victory for china in the long-term. we can't expect the implications to feature in the market in the short-term. i don't even mean weeks, months or the first year or so. over the years ahead, it helps with the financial market, helps validate iran as -- validate the yuan as a competitive currency.

it is a big win, taking a long time to get there. they wanted to wait until the right moment, to have full support from the gcc countries. >> deutsche bank may be preparing to replace john cryan, the bank's chairman. they have been holding talks with the chief executive candidates. >> why did they want to replace him? he is in the middle of this apparently new turnaround push. at least he told me last time i spoke to him in frankfurt, it is taking hold. >> there have been a lot of voices saying he's not the right //guy. /let's strip that down. he has stabilized the bank, no small feat. a lot of people worried about deutsche bank running into a wall a few years ago. he has dealt with legal issues, brought down costs, bringing up capital levels. those are all good things, but you have the issue of, can he return this big tanker to growth? >> germany's biggest lender is conducting a fresh review of its investment bank that could lead to deeper cuts across the trading business. >> they are drilling down into the business to see, where are

we so competitive? one of the focus points is the u.s., where they are facing strong u.s. rivals. the question is, do they still have the capability to compete with them? can we invest money to catch up with them? or is it simply too late? >> the latest polls by japanese asahi news network shows that shinzo abe's approval rating has fallen to 32.6% over the past month. his disapproval rating has risen by 13 points to just try of 55%. a scandal over the state of public land -- links to his wife. >> you are talking about nobuhita sagawa who rose to the head of the national tax office who oversaw this questionable land deal. documents were forged, those were the words used by the prime minister, and did according to the finance ministry, removed the names of the prime minister and prime minister's wife, an honorary principle of that university -- of that elementary, i should say. and remove the name of the finance minister. >> today, he seems to be playing well, playing sacrificial lamb. maybe this scandal will not be enough. but there are other scandals like that. i think overall, it is becoming more likely that the prime minister will have to resign before the end of the year. >> china confirms kim jong-un did indeed travel to beijing this week and that president xi -- what do we know? >> we know that kim jong-un and his wife spent four days in beijing, including travel days, probably about two days. it is a slow train that crosses from north korea and to china. it is interesting, this is what the chinese media normally does. they do not reveal data or details of such a trip until after kim has returned to pyongyang. that is the protocol they used with his father. of course, kim jong-un had never been to beijing, at least since he was the leader of north korea. this was significant because it also gives china a chance to consult with kim jong-un ahead of what is likely to be a summit with president trump some time, perhaps, in late may. >> we have the first

confirmation from can that he would be willing to meet with trump. we have got that on the first point. secondly, as you mentioned, this commitment -- not a commitment, but a suggestion that he would be willing to discuss giving up nuclear weapons in these talks with trump, whatever they may occur. that is a significant step for a country that six months ago said it tested a nuclear weapon. >> bumpy ride for tesla.

shares down for the 42nd day, falling the most in nearly two years at one point as far as the fatal accident involving one of its vehicles. this only adds to elon musk's list of challenges. >> people are looking at tesla's future, not its present, and wondering, if there is a big step back -- if there is a setback in terms of technology, that is a real problem for the company long-term. >> once again, tesla urging workers to improve "haters" wrong. it is getting a -- giving a

limited number of workers the option to work on the crucial model 3 line. >> there was -- that they are not on a pace they need to be to hit their targets. yet again, they sort of used this idea of, we've got all of

these short-sellers out here doubting us. let's prove them wrong. >> saudi arabia has earned secondary emerging market status, which could attract billions of dollars in investment and helped the kingdoms move away from their oil-dependent economy. >> this is just a recognition of the international investment community, for the -- that the saudi stock exchange has taken in the past 18 months to address the requirements of opening up the saudi stock exchange. a more attractive platform for international investors. >> the biggest market in the middle east -- we recently -- adding the saudi market, i think, gives a greater exposure

to the middle east. investors are sharing a real interest in this region. >> -- are in talks to merge, creating a new automaker. that is according to people with knowledge of the matter. -- jumped 7%. the chairman of both companies is said to be driving negotiations. >> the complicated alliance, the french government also plays a role. that is the one to watch, how will the french government respond to this? will they want to relinquish the stake they hold? does this water down control? the alliance has always been a little bit lopsided and skewed. nissan has traditionally brought more of the money. there's always something that has to be done, and by merging them together, according to people familiar, that is probably the first big step to creating a big counterweight. -- has said he wants to play a key role. he has relinquished some authority -- as a unified company, would be a formidable force. >> barclays has agreed to pay stiff penalties to settle a u.s. investigation. stephen morris is here, u.k. banking reporter for bloomberg news. waiting to settle this case paid off for barclays. >> most banks fell in line and paid what the department asked of them, but barclays took a contrarian bet in 2016. take us to court because we don't think we should be paying any more than this. and it paid off. they wanted to cap the annuity of $2 billion, and that is what happened. a rare gamble for a bank paid off.

best. abigail: this week, francine lacqua sat down with ims managing director christine lagarde, meeting in berlin where lagarde gave a speech on strengthening the european union. she says integration is still short of what is needed. >> why has it been so slow? >> i would not say that. i would say that in times of crisis, when there was necessity, they eventually moved very fast. the euro area was clearly incomplete and needed to be strengthened. they put up a firewall, reinforced the banking system. i think they came to a closer accountability, but it is still short of what is needed. they need more talk, more accountability, and more to the point, they need to strengthen three things. the capital market, the banking union, and the central capacity that will signal to the rest of the world that they are shoulder to shoulder together, and will face the next crisis. >> on those points, especially the banking and capital markets union, it has been in the making, but will we get a real capital markets union and banking union in our lifetimes? >> in your lifetime? yes. in mind, probably. -- in mine, probably. i think -- are getting close. i do not think they should take aim at closing and completing the job only when the bank -- has been harmonized, because that will take a long time.

my suspicion is they should send a few targets that would operate as a common base or platform. many elements are there, already common perspectives. -- they need to go a little bit further. i think it is particularly the case, given what is happening on the other side of the channel. the fact that brexit is going to happen. whatever the transition or the terms afterwards, some of the financing activity is going to move to the continent, and i think it is important the euro area be a joint, properly united. there is one component where i

believe the members are almost there. that is this common fiscal backstop in fiscal bank resolutions, which would be welcome. if the bank fall -- to operate if needed. where it is going to be more gradual, but what i hope will happen is on this issue of the common deposit insurance mechanism where it is a bank -- where if the bank falls, the deposit is protected by a mutual fund that is actually financed and operated by the banks. sanford -- capacity would be difficult.

abigail: coming up, conversations on trade and tariff. conversations with business leaders from across sectors. >> the psychological impact of the degree of friction right now could be serious for markets. >> another exclusive interview, this time with amin nasir. >> -- in the second half of 2018. retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver.

>> they start to get concerned. for the time being, of course,

the numbers are modest in respect to the impacts. but we see the deliberation of these tensions on a bilateral basis, potentially -- that this won't be good for growth or geopolitical reasons. so, while at this point in time we do not see financial markets being overly impacted by this protectionism, i think if it keeps going on, this could be very disturbing. >> the market -- on friday was pretty severe. >> at the end of the day, you look at, it is always difficult to understand if those corrections are coming as a consequence of the announcement or they are -- as the market develops. for the time being, we will remain constructive on equities and growth. as i said before, we have to pay attention that it does not escalate and create retaliation,

and particularly, if it goes beyond china and the u.s. and starts to touch other countries, that would become problematic. >> former treasury secretary larry summers says the u.s. and china need to dow down the

rhetoric amid growing trade tensions. -- said tariffs may have a bigger psychological impact on the market. >> i don't think trade sanctions need to have a large impact on the global economy. the psychological impact of the degree of friction there is could be quite serious for markets. it is both a matter of what actually happens in terms of tariffs, and the psychology. i hope the temperature will go down. >> it sounds like you don't think the chinese will escalate their countermeasures. >> i won't handicapped with the chinese will do. i think everybody will act with constraint -- with restraint. i certainly hope for a negotiating stance. as ronald reagan said of nuclear wars, trade war's can never be won and must never be fought. >> would -- change your calculations question mark -- calculations? >> i don't think it will impact the view of the fed. >> -- says it is concerned about trade tensions between china and the u.s.. 90% of -- products move between the two countries. -- says a trade war would affect global gdp. >> we believe in fair trade, free trade. there is doubt that if you want to trade well, free trade is a very important driver. if you look at the example of the mining business, it is essential.

we have two key drivers of business. gdp, which seems to be doing well, and the other is trade. 80% of our product is moving from one country to another. so, trade is essential. in light of the recent pronouncement, if you ask me, are we concerned about trade? we are watching it carefully for these reasons. if we step back, both china and the usa are great trading nations. i'm sure if we understand the rule of trade in terms of increasing living standards, and therefore that i believe common sense would prevail at the end of the day. i hope those countries sit down together and work out their differences. are we concerned? the answer is yes, but i believe common sense will prevail. let's see what happens in the next 45 to 60 days.

>> i think for the international stability of the trading system, let us create a goal that china stops stealing intellectual property, not only from america, but the rest of the world, and they and this pernicious practice. if the european or american company wants to go to china to company wants to go to china to sell in that market, it is a minority joint venture and surrender of technology. that does not work for long-term corporate growth and earnings. all that president trump is doing is asking for fear and reciprocal trade, free trade, fair and reciprocal so we can have stability in this international trading system. we have trade imbalances driven by unfair and nonreciprocal trade. >> i have a final question and i hope you answer it, or else my producer will yell at me. the chinese, united states are going to unveil those tariffs on

the chinese products. i want to understand which products. visit high-tech goods? is that what i can expect? >> certainly, the focus of the tariffs are on the china 2025 industries. china, in my view, has brazenly -- has brazenly released its china 2025 plan and told the rest of the world that they will dominate every emerging industry in the future, therefore your economies will not have a future. artificial intelligence, robotics, quantum computing. all of those things in section 301 on intellectual property, theft, and forced transfer is specifically designed to counter those things. europe is being hammered by the same things, so is japan. we are trying to have trade piece where we can have a regular free market system where we don't have to worry about things like that.

>> can you give us any clarity on what we are expecting in terms of tariffs on chinese products or restrictions on chinese investment in the united states? >> the purpose of the whole thing is to try to curb the problems we have found with intellectual property rights. forst technology transfers, forced partnerships. that kind of thing. forced licensing of cyber security breaches. all sorts of problems that are designed to penetrate and vitiate the electro-property rights of american high-tech companies. >>'s policy the answer? some would look at this and say that a lot of the technology they use is sold within china, and actually, tariffs on incoming goods is not going to crack down on what we've seen.

>> i don't think that is quite true. there are codes and things embedded within the high-tech situations that are not that easy to get from the outside or by designing backward from the finished product. if there were, the chinese would not be requiring all of the massive technology licensing and technology transfers that they do. the fact that they are doing that speaks for itself. >> what is the message we are trying to send to china at this moment, mr. secretary? is it that, look, the united states is preparing for a possible trade were, or we are ratcheting up the pressure and want to bring you to the table? >> i think it is something quite different from that. in terms of the steel and aluminum tariffs, the message

was, we are trying to protect our present day products. in terms of intellectual property, the message is, we are trying to protect the future. the intellectual property of today is the important finished product of morrow. so the message is very straightforward. we don't mind competition that is fair and square regardless of where it comes from. we do mind competition that is based on violations of fundamental intellectual property rights. to give you a feeling of how important this is, the u.s. patent and trademark office, also part of the department of commerce, sometime this summer

will issue its 10 million patent. there is no country on earth that has ever issued anything remotely like 10 million patents. that is the key to a lot of america's success, technological leadership. we cannot afford to have that stolen or strong-armed away from us. >> i feel like this strong-armed, the aggression is coming from the united states to take action. that is the stick. what about the caret? >> we are not strong-arming. we are finally coming to our own defense against abuses that have been going on for years and years. ♪

♪ abigail: one of the big global deals of the year is the highly anticipated ipo of -- reports of investor skepticism, and possibly a delay and the 2019. the ceo is not concerned. he defended plans for the ipo in an exclusive interview with

jonathan ferro. >> -- a lot of the questions in the -- and the media coverage and what you see is about the ipo and when it will happen. there is a lot of demand for the lifting -- the listing, and the detail we show. how are performance and -- we are the highest producer, the most efficient and reliable. this is a great company that, hopefully, will show its performance. >> when i speak to people, they are not talking about when this will happen or if, that perhaps the whole ipo goes into a deep freeze and does not happen at all.

>> there is a lot of work still ongoing. the company, the government did all of the work to make it a -- company. an indication that the ipo is ongoing. the preparation has never stopped. we should be, as we always said, as a company, for listing in the second half of 2018. we are doing a lot of work. committees from the government that overlook what we are doing, and -- to make sure -- >> you have a set of accounts for u.k. and u.s. standards already? for the core company itself? >> the requirement for listing -- required by the listing venues, we will be unveiling all of the necessary documents. >> it is not ultimately your

decision when this will happen. i'm trying to understand when. >> the timing of the government -- the timing, the government will decide. this is a complex process, something that requires time. there are a lot of venues to list in other than the kingdom. there's going to be a lot of work to evaluate all of that and decide on the timing. >> the push for a taunus is facing fresh skepticism following the fatal crash of an uber self driving car. we asked car executives about the future of autonomous vehicles. >> the tragic incident in arizona for uber's accident --

do you see the regulators putting the brakes on the efforts to develop that kind of technology? >> i think, the first thing, our sympathies in the tragedy in arizona. we believe in technology. where everyone is getting lost, they are looking at this like a race. we don't do it as a race. we view it as making a car. making the automotive environment safer. we have always been the ones to express caution. there's a lot of tt barnum -- pt barnum-ism. at audi, we always test with two engineers, one in the back seat looking at the data. you need to work with consumer understanding. you need to work with regulators. but it is not a sprint.

getting it right is winning to us, and i think we will. >> i think many people share that view. to what extent, these developers have had free reign on public roads to develop this technology, and whether legislators will clamp down on that. do see that happening? >> i think that is what you are seeing in arizona right off the bat. i think the best thing for regulation is absolute transparency. they need to share the data and see the data. the word we keep using his trust. to the regulators trust the technology? does the consumer? i think we can deliver. that is the ecosystem that you are seeing broken up. the other thing we need, you do need a federal standard, because that will get away from -- coming up with initiatives. caution is the name of the game, because you are talking about people's lives.

that is what we have always said and will continue to say. >> where is afford right now? we saw -- has done a deal with jaguar. you wish you had done that deal? >> ford is one of the top companies. we have invested in argo and pittsburgh. what is different about ford is that we are developing an exclusive product based on hybrid technology so we can run the vehicle 20 hours a day. that vehicle will be unique, just for automated use. we are also betting on not just moving people, but moving goods. we are working with partners like dominoes, lyft. not only mapping the city but running the business model with drivers in the car, and non-automated cars operating services and drivers cannot leave. they are simulating the experience, and boy are we learning a lot. >> the safety of these autonomous vehicles --? >> that is an unfortunate

development. four is a 116-year-old company. nothing is more important to us than safety and the brand itself. for example, we have two safety drivers in every one of our cargo vehicles. this is important for us because it is a new technology and we do have to test on public roads in difficult situations. we are learning a lot and taking every precaution we can to protect not only our customers, but pedestrians. >> -- making waves at the new york auto show. it teams up with waymo -- electric offering from the luxury units. we are joined by the jaguar land rover chief executive officer. why did you choose waymo?

>> -- is a prerequisite, and we have a clear mission about mobility. this mobility cannot be done in isolation anymore. modal mobility needs partnerships with governments, across industries. we are leading with electrification. at the end of the day -- share your vision. share the vision of modal mobility. two partners coming together to create something special and new. >> some might say your announcement is unfortunate given the recent tragic news out of uber and tesla. does your tire may be slow down the rollout of this ride-hailing service that waymo wants to

implement? >> not at all. from my point of view, we are doing everything on the side of the car manufacturer. -- outspending in design, in performance. in delivery, it develops -- the deliveries -- it delivers everything you can expect from such a premium car. -- and security systems, so this will be a very good phase to develop this kind of service in the future. >> chinese consumers in the past, when they looked at historical tensions with japan or south korea, they boycotted some of their cars. are you concerned about a trade war between the u.s. and china, what it could entail for chinese consumers? >> i think a trade war would not be welcomed by any businessman. the reality is that free trade

is the growth engine for rising prosperity levels around the globe. in order for free trade to be sustainable, it fundamentally needs to be based on fair rules of trade. that, i think, is a universal truth. >> there was a tragic incident involving uber and an autonomous vehicle in arizona. i know general motors is active in this area. do you expect this will increase the level of regulatory oversight and slow down the process? >> general motors and cadillac specifically have been conservative in the rollout of autonomous technology. we fundamentally believe that the thing in development is to be done in the controlled environment in the hands of experienced engineers, not in the hands of consumers. if this means we have a slower rollout, so be it. we are one of the leading proponents of autonomous

capability. given -- of general motors, we have to be very circumspect, especially for the reasons you articulate. the way we rollout the technology helps consumers and regulators alike. ♪

♪ >> a look at the bloomberg, red

versus green, red indicating that technology, the worst performers. that is a big slice of the market because it is the biggest component. >> there are about 30,000 functions on the bloomberg, and we always enjoy showing you our favorites. maybe they will become your favorites. here's another function you may find useful. -- quicgo -- a quick take from this week. ♪

>> that was just one of the many quick takes you can find on the bloomberg. you can also find them on bloomberg.com along with the latest business news and analysis 24 hours a day. that is all for this week, thank you for watching bloomberg television. this is bloomberg.

♪ retail.

under pressure like never before. and it's connected technology that's moving companies forward fast. e-commerce. real time inventory. virtual changing rooms. that's why retailers rely on comcast business to deliver consistent network speed across multiple locations. every corporate office, warehouse and store near or far covered. leaving every competitor, threat and challenge outmaneuvered. comcast business outmaneuver. >> logged in to bloomberg

businessweek. i'm carol massar. is a puzzle trade work, we are talking about the battle between u.s. and china. volkswagen, skin of an, using our power to fight it. >> builds on about the cost of becoming the first billion-dollar asset. we are talking about tiger woods. >> all of that is ahead on bloomberg businessweek. ♪ >>