♪ coming up on "bloomberg best," the story that shape business around the world. onma continues to escalate our trade, diplomacy, and politics. >> the trade cease-fire is no more. >> we may see a freefall of oil production for it -- production. >> president trump is trying to keep a door open. to seesche bank is ready it shareholders at an annual meeting. >> facebook' g seems to be, i will get back to you. economic -- weighty

words with bloomberg. >> i concur with him fully. >> and as markets react, the experts offer their perspective for it. >> the bank continues to raise rates and it will not be good for economies. >> you have got to be consistent in terms of how you manage credit and looking for signals. >> central bank governors are good at their job. in the workforce and growth in productivity, and i do not see us making policy steps to address either. >> it is all straight ahead on, ." oomberg best ♪ >> hello and welcome. , "bloomberg best," from

all around the world. this week began with the ongoing trade battle between the china and united states. areashington says tariffs on hold as beijing significantly decreases its purchases of american goods. both sides is stepping back from the brink in putting out this joint statement delivered by the white house. itsa committing to increase imports of particularly u.s. agricultural and energy products but also services. toh sides committing increasing trade and manufactured goods. it that we doe is not have a trade war imminent but there is no resolution to anything? >> it is better than nothing.

[laughter] >> i do not know what to think of these headlines, negotiations will continue. rhetoric will heat up by both sides at some point. >> just three weeks ago, president trump is casting doubts on his own summits with north korea. trump told reporters that there is a, "a very substantial chance it will not work out and take place as planned on june 12." >> potentially in the long-term, the u.s. good advocate -- could advocate for having a one korea policy. ae chinese obviously playing crucial role on the korean peninsula and the central approving aittee measure on a 23-two bipartisan vote of an amendment to led by senator chris van hollen, a

democrat from maryland, it would prohibit changing penalties regarding the lifting of trade restriction against telecommunications firms like zte. >> the chances for this meeting falling apart are increasing. should i not expect for to take place? >> it could go either way at this point. said,korea has basically we are not just going to hand over our nuclear weapons for nothing. it is going to be a phased approach and a tough negotiation. the trouble continues and knee e.m.'s as the turkish lira hit a fresh all-time low. from a currency crisis to a country crisis. >> not yet. we seem to be in the midst of a currency crisis right now. the lira doctor more than 5%. that is the biggest -- dropped

more than 5%. the biggest the client in a decade. central bank in a series of record lows. what is the late liquidity window and what is raising its by basis points mean in practice? bank hasrkish central been and a vein of and its rate policy and has been funding the market from that rate. the question is whether that is going to be enough and whether the reaction from markets is the probably not. the president threatening on international cars. the largest importers to the united states would be the hardest hit. >> the trade cease-fire is no

more. president trump again citing national security concerns and asking treasurer wilbur ross to launch an investigation. around the world's response, it has been critical. china's trade minister has said causemposing could confusion and lead it to the breakdown of multilateral trade systems based on wto rules. has formed a task force and is considering countermeasures. meanwhile, the chinese also say they are opposing, "the abuse of national security investigation." >> president donald trump calling off his plan to june 12 summits with north koreans leader -- north korea's leader. he called it a setback for the world and through the ball back corpo --jong-un's

court. pres. trump: i am waiting. is trying totrump keep a door open and now we have to see whether the relationship continues to deteriorate from your, or whether there really is help that a new dates can be scheduled. i think kobe very much harder to schedule -- i think it will be very much harder to schedule a second plans meeting. interesting to me is what this says about china. the rhetoric was that he needed china to help make this happen. now that need is gone and we have that trade issue for -- trade issue. >> the country remains willing apparently to meet the united states at any time.

>> the chances of us summits happening maybe not june 12, but at some point, are just as likely today as they were yesterday. this is megaphone diplomacy theng from both sides and old tactic from the north koreans and that is ramp-up attention to it -- ramp-up the tension to get maximum. pres. trump: we will see what happens. watching a been session followed by a question-and-answer session with some of the world's most powerful leaders and a very serious discussion between french president emmanuel macron, russian president , and the imfn managing director. they took on issues as wide-ranging as iran, climate change, korea. >> do you have any advice for

the world in terms of how to deal with president trump? you are somebody that was andated with the election you look and see that there are many people here who are under sanctions. he has just withdrawn from the iran deal. what do you think you have got from the relationship with him? to trumpnot connected electoral campaign. donald trump has expressed concern about a new arms race and i concur with him fully. the measures that we are talking about, north korea, iran, they together, butit that is another reason to talk about these matters. >> to me, the headline was trade. the consensus of the panel without naming donald trump by name, raising wrote questions about his global trade policy. on the show,d

exclusive conversation with the wells fargo ceo tim sloan. week'sthat, more of this top business headlines. congress rolling back the dodd frank. >> it is a larger gift to the larger bank. this is bloomberg. ♪

one 800-653, -- ♪ >> this is bloomberg best. with the result of a controversial presidential election in south america. >> more of the same in venezuela, president maduro won reelection.

it was condemned by the united states and other nations. a widely expected outcome but mostly about border turnout and who came out to vote, will this legitimize the election, what happened? >> on the streets, we saw a scant crowd, there were none of the crowd we have seen in the past. when loision levels we have seen in decades. -- were the lowest we have seen in decades. forward, i do not think anyone expected this outcome to be different. debt --rder prohibiting >> a new level of sanctions on venezuela with concerns over its crude production.

>> venezuela is producing 1.4 to 1.5 million barrels a day. the situation, it is going to get worse before it gets better. be below oneld million barrels a day in the range of 500,000 to 600,000 barrels a day. point, priceshat can go up to the $85 to $95 barrel range. >> we may then see a oil-for-all -- a freefall production from venezuela. it may mean it is one of the major risks for the oil market in the months to come. >> italian president has asked northern to form a government. league whoset

eurosceptic policies are around the markets. what happens next? to members ofpeak parliament leaders and then he puts together his cabinet list and takes it back to the president. is the key manager post a people are looking at. it will be a gentleman who has expressed skepticism about the euro common currency. the government plans to confront the eu on a lot of issues so he has already said he will talk about the conclusion of the banking union, asylum-seekers, and issues such as that. they will make their presence known in brussels. president trump today is expected to sign into law the conference of banking bill that dials back on the restrictions of dodd-frank. it reduces the number of banks that are facing the tougher to has, smaller banks get relief

from volcker, and a relief for custodial banks. >> the negative effects of the regulation in terms of cost, that has been a big one. especially bait for the smaller banks that do not have the leverage so that relief is important. it saves them some of the compliance cost, but the other aspect is, it makes it more beneficial for these banks to emerge. -- to merge.ge smaller banks will get relief under this bill but that does not hide the fact that what this bill does as an unnecessary gift to the larger banks. you are talking about to release up to $250 billion in assets. cutting import duties on cars from 25% to 15%. around the world

rallying on the news. which automaker benefits the most? be theill probably makers of the high end, premium car manufacturers. rover, thed manufacturers that do not have a large production facility in place in china and rely more on importing vehicles into the market. one of the highest profile glass ceilings in finance has been smashed. the new york stock exchange promoted stacy cunningham to president. given that shey started off as an intern at the big board. >> she was a floor trader as an intern and she talked to a few to some interns about her story. she said the first day on the floor, she knew it was for her.

she stated as a floor trader for over a decade. she has executive level experience at the firm. is teaming up on a new venture and they were able to move her up quickly. the federal reserve continuing to signal a slow, cautious pace of rate hikes to keep the u.s. economy growing and inflation balanced. the message to the markets was there is no reason to rush to raise rates. , and alldip below 3% the major benchmarks cross back into the green. the federal open market committee, the fomc makes it look like a slamdunk. there will be a june rate hike. meansarticipants, that there was only jim bullard from the st. louis fed who does not think that the said to be raising the hikes at

all, agreed. coming, it will likely soon be appropriate for the committee to take another step in removing a policy accommodation. temporary inflation hike moderately above 2% could be helpful and anchoring longer run expectations and consistent with that objective. sounds dovish. they are going to say it is helpful having above targets. >> the u.s. government is dramatically rationing up scrutiny of the red hot market. the apartment is a criminal investigation into whether traders are in manipulating the price of bitcoin. they worry that virtual currencies are susceptible to fraud. >> this is a significant moment. the agency involved with working with the justice department is

the commodities commission which is not another commission which is already investigating. you have the two capital market agencies and the u.s. both investigating the processes. justicecomes to the probe, they are looking at this additional fraud we have seen in the stock market. are seeing spoofing, wash trade, all those manipulative proctors likeock to do to boost the price and get out at the expense of innocent investors. that is interesting. get to deutsche bank, the chief executive wasting no time overhauling germany. today, addressed to shareholders at the deutsche bank general meeting in frankfurt. >> we are committed to our corporate and investment banking we are staying international.

we are active in more than 60 countries. that is the way it is going to stay. >> interesting that he led by saying they are going to be a global bank because it is also true they are cutting jobs globally. we have been talking a lot about where they are going to be cutting in the u.s. first it was 10%, 20%, and now globally. equities and rates. we are going to see what they are really going to be committed to. andstock is been down shareholders have been having mixed responses. spain's prime minister said this morning that he aims to complete his four-year term but is not calling for snap elections. the party suggesting there is going to be a no-confidence vote but he is saying, i am determined to stay. what happens next? >> the whole political situation in spain with a very dramatic corruption verdict in which a

host of former officials were sentenced to more than 300 years in total. hisrunning a racket on watch. he is holding his ground. he is betting the opposition parties will not be a will to form and if you dig's his heels in, he will be able to survive. ♪

♪ welcome back to "bloomberg best." this week possibly'-- this week, a bloomberg reporter sat down with wells fargo ceo. they talked about the public image of the lender and the challenges of markets where wells fargo --

>> there are some markets that we are concerned about. auto, we have pulled back. we are going to be growing that business again. >> where else? >> we are concerned about commercial real estate activity. we are the largest commercial real estate lender in this country, we love that business. but some transactions seem a little frothy. i do not think anybody is smart enough to pick the point that credit turns. in have got to be consistent terms of how you manage credit, and you have got to be looking for signals. >> what are you keeping a close eye on to know when the cycle has turned? what is and foremost, the fundamental economic health of this country. most of our businesses in the u.s. so are we growing from a

gdp standpoint, are we creating jobs, but even in that environment, there is a lot of this location occurring because of technology and other reasons. it can impact our customers. >> there is a lot of concern out there that the yield curve may invert as the fed raises short-term interest rates. concerned because in the past, it has launched a recession. do you share that concern? >> it certainly could invert. not think that is a inverted over a year or two would be a concern that we have a recession, i think it has more to do with the fact that if you look around the world, long-term rates and in japan in particular are much lower than they are in the u.s. you could argue whether or not that makes sense and that is what is keeping a ceiling on longer-term rates. you see the yield curve flat now. the 10 year, the 10 year

treasury that through .1% today. -- 3.1% today. >> i'm not smart enough to know, eric. >> you are risk managing your balance sheet. >> we have great people in our company managing that all the time. did i imagine us in the next six to 12 months? absolutely. backup had a significant of almost 50 basis points in the last few months. the economice activity around the world is going to continue to increase, you can imagine rates getting and that range. -- in that range. >> coming up on this edition of "bloomberg best," more of this week's most compelling conversations. brexit. policy must be decisive. >> confidence and that.

this is bloomberg. ♪

best."this is "bloomberg global trade tensions weighed on markets this week and traders share their thoughts with bloomberg television. nnon, whok with ba condemned the trade between u.s. and china. definedstarted as a process because we were taking a hard line as soon as we started to get soft is vague and general. ist the chinese one to do

play for time. particularly, they want to see the political capital donald trump has and what happens in november, when happens in 2020. they have never had to face someone in a leadership position in the united states of america that understands what is at stake here in this industrial relationship we have, and trump has done more in 1.5 years than administrations over 30 years. he has put to live the fact we have no tools, so the chinese are playing for time. i have been a strong advocate that the best thing to do with china is a confrontation and not one or you try to go to war with them. they are already at trade war with us. a confrontation where we are firm and our beliefs and we will not let you steal her innovation and basically raped silicon valley. it is not going to happen. >> the prime minister is the

base of the plan, which is to get on with that project, and that is what we are going to do. what people like argentina, peru, chile, free trading countries, what they want to hear from us is that we have onfidence and we will get and take that control of our tariff schedules, and i think that is what they want to hear and what they are hearing. >> it has to be quick. you cannot be in the external tariff for long. >> i think it is important for people to have a sense of when it will happen to be able to do it as fast as reasonably possible. >> what is your bottom line? if the u.k. ends up shackled into an arrangement with the european union with terrorists for a long time, would you be -- with tarrifs for a long time, would you be prepared to walk

away? >> the prime minister has made it clear that we are coming out of the single market. >what is entailed by those promises is precise. it means we take that control of our tarrifs and we run our own commercial policy. it means we are able to do things differently if we choose when it comes to our regulatory framework. otherwise, you are not taking that control of your laws or borders. the prime minister has been emphatic about that. david: fiscal and monetary policy were also the subject of discussion this week in the emerging and developed market space. with take an overview bloomberg markets asia to talk about growing challenges countries, like turkey. >> turkey is quite worried. do you see a negative connotation? is it possible? the generaly, if

movement is down, you have the selling process going on. now, and oncebig machines stop selling, you don't get quite an effect. >> we have seen central banks turned defensive. we had bank indonesia raising rates. lastly, brazil held rates, as well. should we expect more of that from emerging-market central banks? >> definitely. you will see more of that and it will not be good for the markets, as you can imagine, if you have rising interest rates. people are less likely to put money into the markets and even in the bank and earn high interest rates. this is an important development we have to watch carefully. >> in indonesia, this has already pumped in seven dollars, and it has done little. what more can you do and how many more great increases can we

seek to help prop up the currency? >> unfortunately, central banks continue to use this tool which usually does not work because of people lose confidence in the currency, they will so regardless because they have learned the hard way in the past that continuing to hold on will not be good. it is better to get out early. i think you will see this continuing. the banks will continue to raise rates and it will not be good for the economy's. what they should be doing is giving confidence to the market by reducing government spending, by cutting down on the bureaucracy. in terms of monetary policy, it is always better for all political leaders to let bank governors to the job they have to do and preserve the income. some of the comments made alerted the international community and investors to the fact that the central bank of

turkey could be under directions, instructions, insulins, and that has created a sense of uncertainty, lack of confidence, which have found its way into the markets. >> with your message to the president of turkey say, please state the way? >> i think everybody has to do their job where they are>>, and i think central bank governors general are good at their job and they should be left to it. monetary policy in relation to interest rates and currency determination, it is best to let it be handled by the experts. particularly if they have a good set of tools. they have some strong fundamentals. it would be much better to leave it to them. >> did anyone see turkey coming in this way? where you worried about turkey before this episode or is it a self-inflicted wound? back in oury

pre-meetings in april for anybody who doubts they were published, we did say with dollar strengthening with monetary policy tightening in the u.s., we would most likely see a flow back of capitals from emerging markets where they had said in the last couple of years and last part of 2017. this is exactly what we are seeing, strengthening of the dollar in the last couple of months, capital flows moving treasurieshe 10 year at 3%, so there is a flow back we are seeing, which is going to answer to some of the emerging markets that have not taken the necessary precautions, or that are weak in the fundamentals. >> i think these underlying concerns about sort of a more

euro government involving core countries in the eurozone has always been there. we are seeing now some debate that for europe is not good. i think europe needs to commit to take europe to the next level, and any discussion about changing the underlying agreements is really not productive. we are seeing that being penalized in the markets. if those talks and rumors continue, you will see that had been continue. it is a nobody's interest to question the fundamentals of the agreement that has brought europe together. >> are we back at the european crisis? could we go back to the european debt crisis? >> know, this is more isolated. i think you see strong momentum out of germany and france to take your lord, and we always knew in that debate, italy is an important part and they are not yet on board for this debate. i think we are watching this play out.

the government that has been in been in italy has really monitoring the situation well. i think an anti-european isement in any country, really causing europe to go back and to be the focus of markets. with brexit happening, there is already a lot of focus on europe. of see the unique winner out the discussion is the u.s. dollar, which is strengthening and monetary policy continues to normalize. the u.s. is back in business moving forward and the europe has to watch that it is not that far behind. >> what are the biggest threats to the u.s. economy now? are whatggest threats is staring us in the face, our aging.ce is our skill levels in the united states are lagging in the world, we ranked 25th out of oic

countries, and the last thing goes we are highly leveraged and we just leveraged up late in the economic cycle. i am worried that will create a headwind economic growth. it means in the next downturn, we may not have capacity for fiscal policy. those ultimately mattered the most and worry me the most. >> there>> is always the question of when people think recession might be coming. i assume you are of the view that recessions do not die of old age, but there is a feeling in the market -- >> expansions, right. >> that maybe we are seeing the yield curve tell us something. >> well, there is always some not immaterial probability of recession, as you know. what i am worried about is sustainable economic growth. we are going to have recessions. my job is to make sure that ups we have maximum

sustainable employment and price stability. what i'm worried about now is not the short-term cyclical questions, but i am worried, are we doing the right things to grow gdp? gdp is made up of growth in the workforce and productivity, and i do not see us making policy steps to address either. both look like they will be sluggish and out years. muchst cannot notice it as now because we have a large fiscal stimulus and the fed has been accommodative. ♪

best."this is "bloomberg i am david ingles. let's continue with more company news and another round of comcast's heavyweight battle over disney's entertainment

assets. as atans take the ring battle continues. regulators are clearing the way for comcast's $30 billion bid from britain's largest pay-tv company. the stage is cleared by matt hancock, the minister who oversees it, and seems there is a public interest issue it comes to this offer. >> i think that makes sense because comcast is largely a u.s. cable television operator and they have assets with a substantial presence in the u.k. they could potentially have overlap, but in terms of the real public interest issues, which is around control of news media with the fox bid, this is the news i think people expected to hear. >> comcast confirming they may make an all cash offer. fox has agreed to sell to disney. the stock value is valued at $53

billion and comcast saying their offer would be larger. that would include fox news, and other businesses. comcast said today that the announced they are looking at it and they are preparing their b id. mind you, comcast did make an offer late last year and they and bidding at 60% higher, -- 16% higher, and the box board at the time rejected that in favor of the disney offer, which was lower. the fox shareholder meeting to decide on the disney bid is in the next few weeks, one of the reasons comcast decided to make this public today as they want shareholders to know they are a rival option before the vote goes ahead. ge rising the most in a month after the ceo took the biggest step yet in his turnaround plan. they will merge their locomotive

business with a tech valued at $11 billion. they are going to maintain a majority ownership. >> that is right. deal.a complicated they are selling assets to wabtec and taking other pieces of the locomotives business and merging that with the wabtec and their shareholders will own 51% but they will be largely passive will keep the name. >> ge shares are falling the most in six months. flannery is not finding it easy to sell turbines. >> the market continues to be challenging for new gas service. >> what did he say that really rocked investors? the last earnings report that came out actually seemed like he was getting things back on track. >> the comments people are pulling out of this is there is no quick fix and the power market.

to me, that should not be news to anybody. ge has been cleared they expect weak demand in the power market the next couple of years. today, he said through 2020 they are not looking for a big take up. the number that stood out for me was a 10% profit margin target in the power unit. that is down from a previous mid-teens. to that is important because moody's has highlighted a low to mid-teens profit margin and that power unit as an important goal. failure to reach that could because for a downgrade. flannery said it is a timing issue but the question is, how much patience to the credit rating agencies have? >> a motor group has canceled plans for an $8.8 billion deal with an unprecedented victory for shareholders. the second biggest conglomerate to pave to restructure the way for succession but is now on hold. what are shareholders winning with this decision?

>> elliott management, the active shareholder leading the fight is asking for $11 billion in cash return to shareholders. they also wanted increase in dividends, independent directors, and other steps to improve corporate governance. there is a lot there. hyundai did not say they would implement those, but by rejecting the previous plan, the expectation is they will move more toward the kind of ideas that elliott was proposing. more broadly, this shows that thegroup is seeing that future lies with shareholders, and going along with their interest more than the founding emily's interests'-- familys interests. >> it abide in supreme court today decided employees could give up their rights to file class-action lawsuits against employers, taking mandatory arbitration clauses one step further. give us a sense of why they decided that way. >> the court was dealing with a

an employeeere signs an agreement as a condition of employment that says any disputes i have with you, i will take this arbitration and pursue them individually. millions of employees have signed agreements like this. the supreme court said based on a 1925 statute, the employer can enforce that and effectively keep the employee from pressing suits over a small amount of disputed wages, from oppressing them as a class-action. -- from pressing them as a class-action. >> energy finance issued their latest report and a standout is china will continue to be the largest eb market through 2040. it is the blue bar you pay attention to, china's market share of vb. the other is europe and the white is the u.s. is this a subsidy situation? >> the eb market -- the ev market, we talk about tesla, and

it is 10% of the ev market. we have seen rebates and tax incentives for oemse to sell and largely, this is whatv characterizes -- tax incentives for oems to sell the ev and this is what characterizes it. >> one will electric vehicles be able to share for themselves? but will change that, batteries -- what will change that? batteries? sinceces have fallen 80% 2010. we expect that to fall another 50%. we think that is where the crossover parity is. 2025 is in the expect the upfront cost of electric vehicles to be compared it to combustion engines. basis,on an operating the total cost of ownership is making sense already. >> facebook ceo mark zuckerberg facing another grilling over the user data scandal. lawmakers frustrated by dodging questions.

> ist six yes and no questions and got not a single answer. six yes and no questions and got not a single answer. >> i will make sure we follow up and get you answers to those. >> what were some an uncertain questions -- unanswered questions? >> facebook at this hearing where all the questions were asked for about an hour and zuckerberg responded in bulk for about 26 minutes. he said, you ask questions about content, here is what i think. you asked me about data, here is what we are doing our data. it did not get to the heart of a lot of specific questions that european lawmakers prepared. all of these very sort of clear zuckerberg questions was able to answer them with general steps the company has taken to try and do a better job in the last few weeks. >> from the spectacle of nonanswers, and bizarrely,

facebook strategy seems to be go to testify, whether it is that congress and the u.s., or the european parliament, or the british committee, and then saying, i will get back to you. i will get back to you. that is a good question, i will get back to you. >> i think it is important for us to have three important engagements. to apologize of european citizens. the second point is it will respect the new data protection rules in europe. for a goodill work election campaign for 2019. hashe california jury awarded more than half $1 billion from samson in the retrial of a dispute. apple had sought about 4 billion

and samsung argued it should only pay 28 billion for infringements. >> samson has said it disagrees with the ruling. samsung hasute -- said it disagrees with the ruling. the big dispute is, what should the penalties be? should be on all sales that samsung got from the entire products sold with these infringing patents, or should they only pay for a particular component that infringes? that is the dispute we will see the next few months and years perhaps.

between the italian 10 year and german ten-year, look what has happened in the last week, the spread continues to widen,

the widest since june last year, having jumped by 34 basis points last week. david: we have about 30,000 functions on the bloomberg and we enjoyed showing you are favorites on bloomberg television. maybe they will become your favorites, too. here is a function you will find ic . john: here is a quick take john: from this week -- here is a quick take from this week. >> cyberattacks had the backing of one nation with the intent of party another. >> it is using a computer and hacking the copper something you ordinarily would need a bomber got to do. >> this takes on many forms, affecting -- infecting an enemy computer by disabling it with messages, or with good old-fashioned malware, like a virus or worm. >> shutting off power is a big one. shutting off service in transportation networks, like

real services. >> a number of countries, including the u.s., are known to have active cyber warfare programs, but -- >> russia decided to be noisy and make it known they had these capabilities and they are ready to use them. >> like causing two large-scale power outages in ukraine or manipulating social media to sway elections. >> we have to worry not about cyber warfare but information operations. that is what happened in the 2016 election with the u.s. >> attacks including information operations that go by the 2006,nds each year since and those are the attacks we know about. >> a lot more happens that the general public is not aware of. we do not know how often it happens. we have no idea. david: that was one of many you can find on the bloomberg. you can also find the mac bloomberg.com, along with -- find them at bloomberg.com, along with all of the business

analysis for the four hours a day. that will be all for "bloomberg best" this week. i am david ingles. this is bloomberg. ♪

carol: welcome to "bloomberg businessweek." i am carol massar. jason: i am jason kelly at bloomberg headquarters in new york. carol: coming up in this week's issue, we have the imposters that are hijacking twitter. jason: we have a catch 22 with kim jong-un. carol: and on the cover story, we have an unlikely turnaround in the auto industry. jason: this was unexpected from volvo. carol: i love this story. we got more from our reporter.