carol: welcome to "bloomberg businessweek." i'm carol massar. jason: and i'm jason kelly. we are here at bloomberg headquarters in new york. carol: in this week's issue, general motors signing a winning strategy in china. jason: that's right. i don't think many people have heard of it outside of china. carol: exactly. jason: first, we get to a really interesting story about a deal that died. the art of killing the deal, you

might say. a $6 billion bdeal, and a cast of characters. carol: a bunch of companies, on-again, off-again deal. we got more from our reporter. >> carl icahn bought a-shares in xerox back in 2016. at that point, xerox had gotten into the outsourcing business by buying a company that been started by another colorful billionaire, who will be a character in our tale. carl icahn bought a-shares thinking there was an opportunity that these two companies should split. they did. and the standalone xerox is basically left as a pure play copier maker. jason: before we get too deep into the story, remind us who carol icahn is? >> sure. some people call him a corporate raider. he prefers to call himself an active investor, and he has made a name for himself by taking

over these companies, often and finding trouble a way to get his money out. sometimes that involves selling off assets, sometimes that involves taking over the companies, sometimes it requires demanding stock buybacks. but he is very successful, and is willing to be very confrontational. so what happened here is that he, a year ago, had a dinner with the new ceo of xerox, a man with the new ceo of xerox, a man named jake jacobson. he basically told jacobson that he thought he was not very good at his job and that he needed to sell the company or he would be fired. and that kicks off this year of intrigue and bumbling that ends up with xerox selling itself to this long-time strategic partner, fujifilm in japan, and then unselling itself after carl icahn and another person, through a legal proceeding and a proxy fight, basically put pressure on the company to get it undone. carol: who was in charge,

though? it feels like you have the board thinking one thing, the ceo thinking one thing. who was in charge, or who was talking to whom? >> that is a good question. one of the most remarkable things about this process is that jeff jacobson, the new ceo, is fired by the board midway through the talks. the board pretty quickly decides he is not the man for the job and starts looking for his replacement. tells him that he is basically being dismissed, but then he basically pleads to be able to continue these negotiations, ,aying basically without him there is no deal. jason: because he at that point has been talking with fujifilm about a potential deal? he flew to japan. he sat with another colorful figure who runs fuji, and they hatched this whole scheme to a that he sees potentially as a lifeline for him? >> right. it is reasonable to assume that he saw this as some sort of

reprieve, that if he could get a good deal that maybe he could keep his job. the lawsuit that was brought strongly argues that basically to jacobson it no longer mattered if it was a good deal or bad deal. in effect, he would lower the fuji's team and started negotiating on their behalf to get a deal that they would like, rather than a deal that would make sense for xerox shareholders. carol: up next, why higher oil prices do not sting the way that they used to. jason: and why birthrates aren't rising with the strength of the economy. carol: this is "bloomberg businessweek." ♪

♪ carol: welcome back to "bloomberg businessweek." i'm carol massar. jason: and i'm jason kelly. you can also find us online at businessweek.com. carol: and on our mobile app.

in the economic section, we have to keep an eye on oil. up, and upnitely from a year ago. jason: right. it is confusing. all of the movement, who is winning, who is losing, what is at stake and where? carol: we got more from our editor. >> the imf is forecasting global growth picking up to 3.9%. so, that is a good thing. that is one of the factors driving demand, in fact. thealso importantly though, global economy is not as energy-intensive as it was in 2008, which was the first time we got $100 oil. that is a big difference. industry in the developing world, less energy intensive industries, more energy choices because over the last decade at least in the developing world and china, more solar, more biofuels, or renewables. carol: let's talk about china. they are the world largest importer of oil. >> yeah. carol: so, this can potentially

hit them harder than others. >> yes, it is certainly going to have an effect on inflation. that is the first place we usually see effects. and so, already forecasters have anticipated that inflation in china was going to pick up to something like 3.2% this year, i think it was 1.7 last year. and we may see that number trend a bit higher than that. developing countries have ways to mute the effects on consumption. so because the drag, the economic drag from higher oil is gasoline usually for most people, but in developing countries, there are subsidies and other ways that governments can mute the effect. carol: i thought it was interesting in terms of europe, because we are already seeing growth moderating there. i am curious if they feel more of an impact? >> europe is definitely vulnerable, because we see the pace of industrial production and growth slowing. and the whole region is the a net importer of oil. jason: and while you talk about

net importers, it may hurt producers as well. russia potentially. >> in some countries. russia has a mechanism where it suck away oil revenue at a certain price. the government will not get as big of a windfall that it can spend. saudi arabia is deadly going to benefit. i mean, although that country has been in the middle of an austerity program, which it is trying to reorient it away from oil. this will be a temptation and we will see how the government navigates that. jason: that is a really interesting point, given all of the noise that the crown prince has made about this diversification, sort of more political openness. >> right. so, i mean, people have had to accept in the public sector, salary cuts, things like that. so we will see how, whether the temptation is to restore some of those cuts, or whether to take that money and use it to find

fund new industries and new ventures. jason: i feel like not a day goes by that we are not talking about venezuela. obviously, the elections last weekend. it is incredibly important from an oil perspective. >> yeah, except it has been a more than a year that that country has been pretty much on the margins in the oil market. and you know, production has fallen to a 30-year low. it could go lower given the u.s. , the trump administration has threatened an oil embargo. on havingery intent regime changes in venezuela. also, conoco phillips is maneuvering to get a judgment in its favor enforced. it was one of several companies that was expropriated by the nicolas maduro regime. so they had a $2 billion settlement and have been trying to take oil stored in caribbean terminals, venezuelan oil stored in caribbean terminals, waiting to be processed. that would be an interesting precedent for a lot of countries

to look at. carol: what about the united states pulling out of iran nuclear deal? how does that impact stuff? wildcard. is a it is a very big producer. so, what is not clear, we know that the oil embargo that preceded the nuclear deal was quite successful in holding down iran's exports. however, it did also reorient the country's pattern of oil trade towards china. so what remains to be seen is when sanctions come back, as a trump administration threatened they will, whether china will abide by that effort, we think the numberso india, two buyer of iranian oil. , what is india doing? india is a closer ally of the u.s. and may tow the line more. jason: staying at home, obviously oil prices are going to factor into potential inflation, which factors into decision-making on the fed.

how do you see that playing out, especially as it relates to inflation? >> well, i mean, it is going to be more difficult in asian countries where oil makes a big part of the cpi. , of the consumer price inflation basket. in the u.s., it is not as big. also, what is going on in the u.s., actually this whole trend is most interesting for the u.s., because in the span of the last decade the u.s. is almost at the tipping point of becoming a net exporter of oil. jason: right. >> that means that the country used to get hurt by higher oil prices. now, it is on the margin and it will benefit. so, the fed will benefit. carol: shale. jason: the shale revolution. >> that's right. the fed already has a measure that strips out energy prices, and food prices, which sometimes add noise to inflation. we don't anticipate that the feds' schedule of tightening is going to be affected yet, but in other countries, for sure. jason: let's stay in economic section.

really interesting story here about millennials. high home prices, tough to find a good job, and also a lot of student loans. what is the effect? carol: they are not having babies. the birth rate is the lowest in decades. we got more from our economics editor. >> the data just came back that center fortional health statistics that the birth rate in the u.s. fell again in 2017, back down to its lowest level since the 1970's. and this is a surprise because the birth rate fell back in the financial crisis of 2007, 2008, 2009. things are really bad. carol: everybody pulled back. jason: people couldn't afford to have kids. >> but it was widely expected that it would recover along with the economy. so now, we have the unemployment rate down to 3.9%, the second longest expansion in history, and yet, the birthrate rather than a rebounding is continuing to go down.

to go down. so, why? that is what the story is about. and i tried to argue that it is because the general health of the economy is very good, but masks problems with the young people, who of course are the ones who should be having the babies. carol: are we blaming the millennials again for this? >> it is not a matter of blame. they are actually the victims in this thing. i will give you some examples. it does not show up in the unemployment rate, which is not particularly high. where it shows up is the employment of population ratio. so this reflects the fact that people are staying in school longer. when you are in school, you are less likely to start a family, or you are dropping out of the labor force entirely. so, for both the 20-24 age group and the 25-29 age group, the employment to population ratio is more than two percentage points down from where it was when the last

business cycle peak. jason: you also point out that when people do not move out on their own and move back in with their parents after college, less likely to start a family. a little awkward. >> it is very awkward. actually, that was one of the most surprising statistics. this is census bureau data. these are all real numbers. these are not anecdotal stuff like strolling through neighborhoods and seeing strollers. [laughter] jason: he is practicing real empirical journalism. carol: he does not like my standard deviation. i can feel it. [laughter] jason: we are talking to peter coy. carol: bow down to peter coy. peter: the data from the census bureau shows the ratio of young people who live with their parents, not only has it not rebounded, has it not gone back down the way it was expected to, it is actually at a record high. records going

back to 1960. so, yeah, if you are living in the bedroom you grew up in, you are probably not in the mood for starting a family. carol: the other thing that i think is important, too, you talk about the amount of student debt. >> yes. carol: i can see people hold off until they feel like they can do it the way they want to do it, or can afford to. peter: this is a change of events starting with states cutting back on financing for schools. most people go to public colleges that are supported by states. when they cut back, the burden fell on students. tuition went up, students cannot could not afford it, they borrowed money. according to the new york federal reserve bank, the amount of student loan debt carried by young people under age 30 is up 75%, again going back to 2007, which was the last business cycle peak. that is a lot. jason: and so, you also argue that the longer it does not be bound, the less likely it is to. >> right. well, think about it.

if you are a woman who is 25 and you say you are not quite ready to have a baby, fine. you can have it when you're 30. but if you are starting to push yourward 30, 35, 40, window is shrinking. so we do see in the data with , the numbers that came out last week, the birthrates for the older age groups, 35-39, 40-44, are up. but they are not enough to compensate for the decline in the younger ages. carol: so, do we become -- i mean, we see the numbers in problems in china limiting the number of births and what that has meant for their workforce. jason: a policy they are thinking about changing. peter: right. i mentioned that in the article. the u.s. situation is nowhere near as severe as china's. china had a strict one-child policy that they began to ease up. they are talking about getting rid of it altogether. they are too late on that. china has a huge problem mounting in the coming years

because they are going to be aging while they are still a fairly middle income to poor country. germany has an interesting story. they have had along with a lot of western regions, extremely low fertility. but over the past years thanks in part to immigration, and also thanks in part to more child-friendly policies, their birth rate is the highest in 20 years. carol: is that what the u.s. should do? i mean, i think about immigration. peter: right. carol: how that might potentially help the situation. peter: it does to some degree. it helps the size of the population overall. what sense to happen is that families that come from other countries that tend to have higher fertility rates than the u.s. tend to converge on the u.s. rate. so that is why one of the biggest declines in the birth rate is among hispanics. they came over here in their first years, and they had babies

at the same rate they were having back home, but now they are having rates of nativeborn americans. jason: up next, general motors find its stride with china's new middle class. call for calm as italy calls for investors around the world to worry. jason: this is "bloomberg businessweek." ♪

♪ jason: welcome back to "bloomberg businessweek." i'm jason kelly. carol: and i'm carol massar. you can also find us on radio on sirius xm channel 119 and in new york, boston, washington, d.c., and in the bay area. jason: and in london, and asia in asia on the bloomberg radio plus app. in the business section this week, this is a brand not many people outside of china has

heard of, a big hit for gm. sales have increased tenfold since 2013. carol: which is pretty dramatic rose. it is all due to an increasing middle class in china. jason: here is david welch with more. >> we have a rapidly growing brand. they make small cars and make npb's which is like a minivan over there. and it has grown 10 x since 2013. it is up to about one million units per year. that is the good news. the bad news is buick has kind of stalled out. and that is really their big brand. so has chevrolet. the brands that are growing our our cadillac on the top of the market, getting nice growth. in china right now, that center part of the market where buick competes against brands like volkswagen and others, there is still growth there. this is china after all, but most of the growth that you will see next year will come on the lower end and higher end.

so the fact that that gm has a domestic brand, a domestic chinese brand, that is growing in the middle of the country, where there is a new middle class growing up, it is a good place for gm to be, and the brand itself is getting better prices and putting out more expensive vehicles. so, this is a nice story for gm. it is just that these are not hugely profitable vehicles because they are small and pretty cheap. carol: talk about it. that's what i thought was interesting. when you talk about baojun, this is a $6,000 a car that they are selling. and it is great if you are selling a lot, but where they see better margins is on the price of the cars. talk about the branding and selling in china. >> baojun started out in 2010 selling the small, cheap cars. the cheapest one was a small hatchback that sells for about $6,000. they have since moved up the range, so now they are selling a full-size suv that goes for about $10,000 or $11,000, and

goes up as expensive as $17,000. they had the seven-passenger van that sells close to $20,000. so the vehicles are getting more expensive. and from a profit standpoint, the other part about this is that they make them inland, which is about a two-hour flight from beijing. that is pretty far inland china. are lower there, and the supply chain is cheaper there. the vehicles of still not the same margins as you get on say a buick suv, or a cadillac, but the president of the company described it as a solidly profitable business for them. and they do expect to see a lot more growth. a company called lmc automotive sees the chinese market growing by 5 million units over the next five years. 2 million, a little more of one will be where

one brand is, and a lot of the rest of them will be on the luxury end were cadillac is. so gm is in the right place to compete for that growth. carol: this week one of the biggest global stories is political uncertainty in italy increasing volatility in global markets. jason: that's right. we went out looking for the best voices to put it in context for us. francine lacqua had an exclusive interview. here is what he have to say. >> i think the selloff is not justified. we are in a situation today with the fundamentals of italy are very good. the economy is growing at a good pace. corporates are positive, and the consumers are positive as well. of course, there is political uncertainty, but i think the idea of italy leaving the eurozone is something which is overdone. and this is what is prompting the selloff, but we should go back to reality. italy will not leave the eurozone. and we need to look at the good fundamentals of the country.

francine: how much is your exposure to italian sovereign debt, and are you changing any of that exposure? >> exposure to italian sovereign debt is around 42 billion euros, which is less than our total capital. it is an exposure which has less than a three-year duration, so it is short-term exposure. we are very comfortable with it. francine: is there anything that politicians can do? is there anything that bankers can do to actually appease the markets right now? >> i think it is important that we pass the proper message to the market, that the current situation in italy is actually stable. the economy is growing very well. every corporate client i see , every corporate client i see tells me that they have gotten

not gotten a better quarter than they have had for the past 11 years. so the page of the crisis in italy has been turned on the situation is actually very good. italian companies are exporting at a rate which is higher than the rate of other countries. they are gaining market shares. in italy, the retail clients are consuming very well as well. so when you look at the fundamentals, there is no reason to be worried. carol: up next, an indonesian mogul learns that trump's deals come with complications. jason: this is "bloomberg businessweek." ♪ two, down, back up!

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"bloomberg businessweek." carol: we are going to talk about u.s. sanctions and why they may have reached their limit. jason: also, we dig into indonesia and president trump's partner there. carol: i love this story. this is a man that is similar to president trump in many ways, and you would have thought that working together would have been a lot of fun, but maybe not.

>> in 2015, just as trump was starting his presidential bid, he was still doing business with billionaires around the globe. one of them was this indonesian partner of his. he decided to do two developments with trump. two trump branded hotels and a, -- and golf courses, one south of jakarta, and another in bali, overlooking an ancient hindu temple. both of those developments paid trump as much as $10.5 million between 2015-2017 according to trump's financial disclosures. when he signed this deal with trump he thought he was signing a deal with just trump the businessman. obviously that situation has changed since then and complicated his situation in

indonesia. carol: let's talk about those complications, because you are right, now it is president trump. they are still moving ahead with these developments. talk about the complications that exist for him now. >> in 2016 he brought in a couple of chinese state-owned companies to help with the resort. first of all, the resort is not just a trump golf course and a hotel, and a clubhouse, but he is building a mini city there with a theme park, and a couple of other hotels. he brought in a chinese state-owned construction company to begin the construction and do some of the infrastructure. at the same time, he signed a letter of intent with a chinese financial institution to provide about $400 million worth of credit guarantees. he later in october 2016, as the presidential race heats up, he traveled to china and met with bank of china officials to get

that financing going. now it looks uncomfortable for president trump to still be profiting from that deal he did in indonesia, that is benefiting -- although not directly, indirectly chinese state-owned companies. that people are criticizing trump for being in violation of a clause in the constitution which bars government officials from accepting gifts are -- gifts or benefiting in any other way from foreign governments. jason: his role as a businessman and investor, but also as political figure as well. >> right. the interesting thing about him is that he has a political party behind him. he has built his own political party in indonesia. it is the world's most populous

muslim majority country. he has his own party and made a failed attempt to run as the vice presidential candidate in the indonesian elections of 2014. after trump won, he started about, he could become president of indonesia just like trump could. i think that complicated his -- this situation and his standing within indonesia. he was backing political opponents of the current indonesian president, and then a few months after that he ended up facing a series of allegations that he was involved in tax fraud at a company that he once owned, and he sent threatening text messages to a prosecutor, and he was

restricted from traveling for a while as those cases rolled on. last autumn, he came out and said he would support the president's bid. suddenly, those allegations went away. when we asked the president's office, they said that had nothing to do with it. now formally endorsed jokowi. it has certainly helped his standing in indonesia by backing the current leadership. carol: up next, a story about an off the books operation that may have helped put trump in the white house. jason: and signs that the global economy may not be bossed around by the u.s. forever. carol: this is "bloomberg businessweek." ♪ jason: welcome back to

"bloomberg businessweek." carol: you can also find us online at businesswek.com. jason: and on our mobile app. online, an investigation into steve bannon and a guy that he hired for the trump campaign, a black activist named bruce carter. carol: the idea was to persuade black voters to vote for trump or sit out the election. jason: campaign finance laws are pretty strict about these things. >> bruce carter was an african-american businessman who gets very excited very early about bernie sanders, and starts

to do a lot of activism among the african-american community to try and get them to come out and vote. as bernie's challenge of hillary clinton fades, he begins to connect with the trump campaign in a series of interesting ways. he ends up going on the road and doing a lot of outreach for donald trump to the african-american community. thing innot an easy 2015. as you pull back layers and layers, it tells an interesting tale of how the trump campaign worked. he was basically recruited by a breitbart reporter who at first feigned interest in interviewing him, but then started talking about coming over to trump, and how trump could do a lot for urban communities. he connects with steve bannon,

who by this time is running trump's campaign. he coordinates with him on what places to reach out to the african-american community. there is a little bit of a twist because in their analysis, it was great if you could get a black voter who would normally vote for a democrat to vote for trump, but it was almost as good if you could get them to stay home and not vote for hillary. this partly became a campaign of voter suppression to try to convince the black communities in places like philadelphia just not to support hillary. jason: i am glad you mentioned that. that was a fascinating piece of the story. if you could get them not to -- if you get them to vote for trump, it is the sensually plus two and if you could get them not to vote at all, it is at least plus one, and if you get -- at least plus it helped to one. turn the election, right? >> absolutely. it is one of the untold stories of the election. if you look at a handful of states, florida, north carolina,

and pennsylvania, all of which trump won by a slim margin, the african-american community played a really important role because it did not turn out in the same levels that it did in 2008 and 2012 and that essentially was a math problem that the campaign was really aware of. they knew that in order to win, they not only had to create a very different map, but they had to get blacks not to come out in the same way that they did for obama. carol: you also talk about campaign finance. we are all learning an awful lot about it because of stormy daniels and president trump's lawyer, but this is also a case that may be looked at, in terms of what bruce carter did, and whether or not there were violations. michael: it is an important way to look at exactly at how ad hoc the trump campaign was in the way that it was operating.

and how it really did not care much about what the federal election laws said. there is a basic tenet of federal election law that if you are campaigning you cannot coordinate your activities with independent groups that are funded in very different ways. in this case, we gut through emails and other documents, we are able to show that there was a very close coordination between carter's efforts and the trump campaign through bannon effectively, but also through other forces. all the money that was going to carter's campaign was a coordinated contribution. nobody paid any attention to the election laws, the limits, and the fact that individuals could only donate very limited amounts under that scheme. they did not really care. we talked to an election expert who said, look, this is basically the way that trump

does business. they were shooting from the hip and they did not really care what the law said. carol: we take a look at u.s. sanctions power. jason: or the lack of sanctions power. here is matthew philips. >> we wanted to look at the past 15 years, the increased use of sanctions as a political and economic tool to get what we wanted over the past 15 years. you really see it ratcheting up after 9/11 for a way to go after terrorists. that brings us to today, and the news that the president is going to pull out of the iran deal. we thought it was useful to look back at this era of increased sanctions and question about whether they were still the best tool to use to get what we want out of the world, and whether they were losing any of their

power in the way that allies react to them, and the way the rest of the world reacts to them. particularly, the use of the dollar as the currency in the world. jason: let's go back one step briefly. you mentioned that 9/11 really ushered in this era of much stronger, much more frequent financial sanctions. what did we do before? >> [laughter] sometimes we invaded countries. we worked with our allies. it was particularly calibrated to go after hezbollah, or countries that were harboring terrorists, and to cut some of these off the grid networks of terrorists, make them even more off the grid. and cut off their ability to access the global financial system. it was pretty useful. it isolated them even more. i mean, that was a problem that had been percolating for years

and years, but really came to the fore after 9/11, and was something that the treasury department really built an entire unit around. it was pretty effective in the minds of most people. carol: right. that is the point, right? it is pretty effective. you have the u.s. currency is kind of the global currency. it is the global currency. you have so much of the global financial system working its way through the u.s. system. does the united states not still have that leverage? >> we still do, but it is not preordained that it will be forever so. this depends on two key ingredients. the fact that our allies are going to go with us on this, and that the entire global financial system will use the dollar as a reserve currency. we are starting to see both of those start to wane a little bit. we see a lot of sniping of europe about the u.s. pulling out of the iran deal, and then we see china basically doing a

lot to build up its currency, and build up some of its ability to become -- maybe not a one-to-one competitor with the dollar, but to become more of a reserve currency. jason: on the topic of european views of this, this is about to come to a head in a couple of very specific ways, correct? there are the pipelines and the cross-border payment system. this could really come to a head fairly quickly. >> when we look at what we have done with iran, it is different from when we all went in in 2012, 2013. by we, i mean the european allies and the u.s. it cut iran and its banks off from the swiss cross-border bank system which is the

international standardized way that banking transactions get processed. when we cut them off from that, that was a huge blow to the economy. it meant that they cannot export their oil and get paid in dollars. it made life miserable for them. now because we are not joined by the europeans, the russians, and the chinese, that remains. iranian banks will still have access to the swiss banks. the point is, even though the trump administration is talking tough about these being the strongest sanctions ever imposed on iran, they are not going to have nearly the punch that they had several years ago. we are doing it alone. carol: up next the app that pays for drinks and, shocking, it is winning over twentysomethings. jason: we will introduce you to the best lap track racer in america. carol: this is "bloomberg businessweek." ♪ carol: welcome back to

"bloomberg businessweek." jason: you can also listen to us you tonight on the radio on and -- on sirius xm channel 119, in washingtonoston and into bay area. jason: we caught up with our have a bloomberg editor-in-chief. carol: we're talking booze and in coffee. >> everybody knows coffee is big business. $1.20 rightor about now. there is other things, before you get to the beans, everyone is throwing it away for years as trash. turns out the husk is turning into big business. for thellars a pound

stuff. we are starting to see a trickle t placest trickle in an like bluebottle and starbucks. it is this little accent that people are using because of the flavor. carol: hibiscus. >> papaya, green apple. these little nuances that coffee heads have always associated with coffee, the husk had some of those characteristics. jason: is it going mainstream? >> it is a beverage that can complement the coffee or stand on its own. it is going mainstream. for coffee growers this is the , thing they always throw away. it turns out to be big business. carol: there are some folks that think it could be a fad. we just do not know yet. >> totally. for them, the economics of this is actually the best part of the story. when trash becomes more valuable than the thing that you're growing. jason: they are getting their

drink on in a different way, in a different way enabled by technology. >> this is free cocktails. >> one thing we always try to do in the magazine is talk about strategy. the cocktail story is about how when you go into a bar, we don't actually know that much about your behavior, what you order and what you do not order. they are starting to back apps that try to give you an incentive to share who you are and what you are drinking. there is an application that if you share your name, gender, you r email address, you can get free drinks. jason: i would imagine that is catching on with the kids these days. carol: it is also catching on with some beverage companies. >> what this does is allow consumer behavior to be monitored in a new way where maybe we can figure out if there are new cocktail trends, new

liquor trends that a company might be able to create new products, or interact with customers in a new way. carol: i had to write it down, because there is competition. pubster, chugg, slugger, hooch. there is not just one application. >> no comment on the names. one of the things that is interesting about this is that there are already new models. one of them is free and another is subscription based. they are actually trying to figure out maybe there is a whole different model about how you interact with bars. could you think that the bar might get disrupted, but that might be where we are going here. jason: we talked about cocktails and coffee, let's head to the racetrack. carol: we have got a story about a woman who might be the best bike racer in america. >> she is from pennsylvania, 27 years old, five feet, and that is interesting, because she can barely touch the ground when she is on a bicycle. she has been doing very well in races, and so i went down and

spent time with her. she has grown up flat track racing and is emerging as someone to watch. >> you watched her, right? what is she like? >> very nervy. it is interesting. she is very quiet. she is a person of few words, but not because she is shy. she is very deliberate when she speaks. that translates to her riding style when she is on the track. she is not flashy at all, you have to watch for her, but she is so nervy. she will find a little spot to get in front of people, and over the course of the race you see her kind of quietly work her way to the front. by the end of the race she is usually in second or third, very far up. very nervy and quiet. jason: how did you find her in the first place? >> to be honest, social media. i ride motorcycles and am friends with a lot of people who are interested in flat track, and her name kept coming up.

people out in texas, ohio, california at this evening dirt track events. it is very americana, very cool. especially during the summer, people are out there, drinking beer. her name kept coming up. it is unexpected. usually she is only woman in the race, sometimes there is another woman, but usually it is a field of 20 guys and her. >> and she is winning? >> yeah, she is winning. she usually gets on the podium. right now, points are counted for the entire season so she is in fifth place for points and the race i saw her compete end, she got second and she had the fastest lap of anyone the entire day. jason: tell us what it is like. you ride motorcycles. you were on a bike at some point. >> yeah. there is a fantastic rider and instructor who let me ride with him around texas motor speedway.

he let me ride multiple laps with him. i basically sat in front of him like a toddler and had my hands on the handlebars. he told me to hold onto the handlebars, don't do anything else. we had the full gear on, helmets, the suit and everything. carol: how fast did you go? >> i was not as fast as he went to race speed. maybe 60 miles per hour. it is enough to give you a feel for the track, and it is really interesting. you can feel the variation in the dirt as you are going around the track, how sticky it is, how wet it is, how deep. you start to feel the bike slide out from under you, it is really exciting. carol: "bloomberg buisnessweek" is available on newsstands now. jason: and on businessweek.com and our mobile app. carol: i enjoyed spending time with our editor matthew philips and the use of sanctions by the united states. it could be a powerful tool, but

not necessarily, especially if you have europe and china pushing back. i felt like it talked about a bigger, broader story, we talked about the shift in global power. jason: that's right. it is very much in the news on a week we're talking about north korea, tariffs. carol: must-read for you? jason: i love a great deal saga. this xerox and fujifilm deal, a lot has happened and a lot may still happen. carol: this is a story with a cast of characters. jason: more bloomberg television starts now. ♪ >> the following is a paid

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