♪ rishaad: coming up on "bloomberg best," the stories that shaped the week in business around the world. historic handshakes and warm words as trump and kim met in singapore, but good -- but are good vibrations a step toward real results? >> they can't ignore the elephant in the room, denuclearization. >> on the question side, will kim honor the agreement? >> 400 words that don't spell out how denuclearization takes place. rishaad: a path for immediate megamerger. >> this is a stunning victory for at&t. >> a chinese tech company struggles to cope with penalties. rishaad: bitcoin worries as

security worries rise. >> they call it a cyber intrusion. rishaad: plus, 1-2 punch for investors as central banks issue rate decisions. >> a lot of signals sent by the fed. as -- not as much noise this time around. >> they are trying to give as clear a signal to the market as they can. >> this announcement will put more downward pressure on it. rishaad: this is all straight ahead on "bloomberg best." ♪ rishaad: hello and welcome. i'm shot salamat, and this is weeklyerg best," your review of important business news, analysis, and interviews from around the world. the week began with donald trump and kim jong-un heading to singapore for their long-awaited face-to-face summit, but on there was still tension in the monday, air from the g7 meeting over the weekend. >> this year's g7 summit might

not have a unanimous communique, after all. canadian prime minister justin trudeau said at the summit's closing press briefing that his nation was insulted by u.s. tariffs. meanwhile, president trump en route to singapore slammed trudeau and the other g-7 nations, saying the u.s. would not sign the communique. how are we to interpret these aggravated tweets coming left, right, and center? >> it did seem hard to believe. before the summit started, trump called dressed in two -- called indignant and lashed out at his allies. i was at the meeting and we were preparing for a lot of fireworks. and then it turned out that trump actually seemed to really get along with people. at one point, we did not think there would be a communique at all, but by saturday, we heard there would be and of course, there was. justin trudeau said it shows we can deliver when people thought we couldn't.

and it was quite shocking movie got the tweet minutes later from trump saying, "this is an insult , and justin trudeau is weak and meek." in the grand scheme of things, not agreeing on a communique does not change the world, but it will be very hard for the leaders of the major countries to trust that trump will commit to what he said he would. rishaad: trump meeting kim. that summit and the potential for progress, which could ease one of the world's biggest sources of geopolitical tensions over the years. >> they shook hands, took photos, smiled. the issue pretty much the details. will the agreement be good enough for both sides to sign this joint declaration? >> they can't ignore the elephant in the room, and that is denuclearization because that is the strong point that the united states is insisting on,

and it really is linked to what the north koreans want. it all comes back to the big d word, denuclearization, and the timetable kim jong-un can offer. matt: president trump and kim jong-un have signed what has been described as a very important document, following a historic one-on-one meeting and working lunch between the two leaders. pres. trump: this is complete denuclearization of north korea , and it will be verified. we signed a very, very comprehensive document, and i believe he is going to live up to that document. >> president trump said he has been able to assure a long-term commitment from the north korea to denuclearize. have.s. is saying it might some military exercises might be suspended. >> president trump said the summit has exceeded expectations , and there have been strong words of encouragement from south korean president moon, who said it is a huge step

forward for people across the world, and saying president trump has achieved a feat no one else has delivered. >> president trump called this agreement a comprehensive agreement, but really, it is 400 words that don't really spell out any kind of deadlines or timetables for how denuclearization takes place, or what the next steps are. >> at&t shares are slipping in clearedde after a judge its $85 billion takeover of time warner without conditions. at&t says the deal will fuel its evolution into a media powerhouse that can go head-to-head for the likes of netflix and amazon. >> this is a stunning victory for at&t. it is kind of embarrassing for the government, if you look at it. the government staked its case on the deal, it said, would raise prices for paid tv subscribers. the judge today absolutely

dismissed that, and said the government's case was gossamer thin. >> the department of justice took a risk when they brought it, but this was a new head of the antitrust division. this was something that he felt very strongly about, anyone -- strongly about, and he wanted to take that risk. it is a first loss in a big case and is something that shapes antitrust laws going forward. >> the fed is picking up the pace of tightening this year and in a clearly telegraphed move , and taking the further steps signaling four rate hikes for the end of 2018. >> we have a solid economy on our hands here. so what we are doing is we're trying to conduct monetary policy in a way that will sustain that expansion, keep the labor market strong, and keep inflation above, sorry, not above, but right at 2%. >> i think what powell was trying to convey is the idea that yes, we are recalibrating monetary policy.

it is not new news. we had been doing that since we were lifting off from zero some years ago, and we are not doing this in the hope and expectation of halting this economic expansion, just keeping pace with it. >> a lot of signal sent by the fed, not so much noise this time around. the most important thing in the news conference was they are going to do news conferences after every meeting in january. that will change thinking on trading desks because now you won't have off meetings were you figure nothing is going to happen. a 60 $5st has made billion offer to acquire much of 21st century fox, top any previous proposal by disney, and setting up a bidding war for rupert murdoch's media empire. what are the key terms of the offer? $65s you said, it is billion, the headline figure, billion that52.5

disney had offered. the other key thing is they are matching an offer disney had made. if it gets blocked by regulators, disney said it would pay. comcast said it would match that , and also reimbursed disney $1.5 billion that fox would need to pay disney for breaking up this deal. and the other thing is, they have given some guarantees our reinsurer pathway to rupert murdoch and fox shareholders that their deal can get through the regulatory process. they have talked about divesting u.s. assets, talked about divesting their regional sports network, and possibly their interest in hulu, as well. vonnie the central bank is : ending its bond buying program. in a press conference, mario draghi said the ecb would wind down the decade-long program by december. the ecb will hold interest rates unchanged through the summer of 2019. this is probably the most transparent central banking we

have ever seen. is it good for the european economy and financial system to be this transparent? >> they are trying to give every signal to the market they can. they are trying to tell them what they are going to do, and what they might react if things go wrong. for now, their assessment is that the economy is doing pretty well. this will probably allow them to raise rates sometime in the thend half of 2019, but at same time, they have clearly said, uncertainty is growing from geopolitics to trade. we know what is going on in the u.s., italy, and all that and this means they want to keep their options open to change their program if needed. caroline the bank of japan left : monetary policy unchanged and lowered its inflation assessment at today's meeting after raising in january. governor kuroda she's core prices in a range of 0.5% to 1%

down from around 1% previously. that pushes japan behind its global peers when the fed raise rates, while the ecb plotted the end of bond buying. >> i think it is more of the same from the boj. they have cut their inflation outlook a bunch of times, one more won't change things a lot. they will keep the 10 year yield at zero, like you said, this highlights the contrast with the fed. the fed said they would do more, the ecb said they would stop their bond purchases this year, so for a central bank that is raising interest rates as in the u.s., the currency rates should rise and the dollar is rising a whole bunch. for ar a company -- and country like japan, where they have monetary easing, and for as long as we can see, the currency is falling, and this announcement today will put more downward pressure on the yen. jonathan: the u.s. is slapping

tariffs on $50 billion of chinese imports. china, planning to announce retaliatory measures. >> president trump's china tariff plan will implement more than $50 billion worth of tariffs on more than 1300 products. the president said those products to be finalized, despite pushback on capitol hill. meanwhile, $100 billion more in the pipeline. >> he is imposing tariffs on 818 items from china. $34 billion worth. and they have another 284 items new to the list. they will have to go through public comment, that would add another 16. you get a total of $50 billion. and most of these things are intermediate goods, inputs into other manufactured product. it is kind of a global problem for everyone, and we have not heard from the chinese yet. they say they will retaliate in kind, putting more companies on notice because they will be actually targeting specific u.s.-made products. >> china's finance ministry has made this statement following

the announcement of those tariffs on the united states. the u.s. measures violated the relevant rules of the wto and it is contrary to the consensus reached in the sino u.s. negotiations. it seriously violates our legitimate rights and interests , and threatens the interest of our country and people. >> the chinese just released their list, saying we have $34 billion ready to be on hand july 6. we are still translating the list, but what we have seen so far is a lot of it is agriculture. pork is on there. the pork producers here had been anxious about that potential retaliation for a long time now. automobiles are on there. the chinese list was very targeted the pork producers have in terms of where to hit, and where to hurt the u.s. rishaad: still ahead as we review the week on "bloomberg best," david rubenstein is getting anxious, saying the

booming business cycle in the u.s. can't go on forever. >> at some point, we will have a slowdown. i just don't know when it will be. rishaad: this is bloomberg. ♪

♪ rishaad: you are back with "bloomberg best." i'm rishaad salamat. let's continue our global tour of the top business stories. in britain, where prime minister theresa may faced a vote in parliament on the future of her brexit plans. >> theresa may has escaped the brexit build defeat after promising concessions to rebels in her party. the british prime minister has reassured members of the conservative party that she hears their concerns over the possibility of leaving without a deal, but the balance could be tough to strike as the clock ticks toward brexit. so, what concessions has theresa may made, or has she said "trust

me?" >> we're used to last-minute compromises, it is a tendency -- it depends who you speak to. we are getting different accounts of what was offered for the pro-eu tory rebels, but in the end, theresa may brought the 15 rebels into her office. to, they say she committed giving them a new amendment, which will go back into the bill before it goes to the lords next week, that will give the commons a veto over know bill. in way of pulling britain back from the brink, what they say is the worst outcome. the brexit department left my put out a strong statement, ripping that up, saying, nothing like that was offered. we just agree to keep on talking. mark, theresa may is done compromising with tories. the deal fell apart. brexit is holding their ground, gambling the rebels will extend.

is theresa may confident that she has rebels on her side? she says she will get through this potential stumbling block. >> according to our reporting, the cover meant does -- the government does think it has the numbers to avoid rebellion next week, but we shall see. it will be a knife edge vote. let's hope that they can count. this iswhat a lot of about, isn't it? it is about counting on your own side and the other side. we will have monday and then the knife edge vote on wednesday. >> bitcoin sells the most in three months after a hack on a south korean crypto exchange. coin rail. this year alone, the virtual currency has slumped more than 40% -- 50%, more -- 50% four , times its rivals. >> they have called it a cyber intrusion on their system. the latest we can tell you is

70% of the cryptocurrencies they had under their umbrella is in a cold wallet, which is taken off server so that the internet cannot access them anymore. the other 30% were the tokens affected, and of that, about two thirds were frozen or recovered, is what the exchange has said. that leaves about 10% that is unaccounted for, and as far as we can tell, the tokens that were stolen. but in terms of dollar value, we don't have a specific figure yet. we also don't have details on how the attacks were done, who perpetrated, who the victims were. the company says they are quad -- they are cooperating with authorities to get to the bottom of this. inflation factory rose faster than expected in may on rising prices for commodities, including oil as well as metals. does this mean that china is out of the woods in terms of any concerns for growth? >> i think the first half of china will be outperforming.

at least the official target of 6.5% income gdp, the ppi rebound is a good sign. we know that china has gone through 4.5 years of deflation, starting from 2016, and the ppi helped revive the economic momentum. in the had some concern past couple of months, whether there would be a drop of the ppi, but the number released over the weekend is very welcoming. basically we think the ppi will , be 4%. >> china's central bank has held off from immediately raising borrowing costs following the fed hike. the pboc decision came as economic data came in worse than expected. the world's second-largest economy showed signs of losing steam in may with an unexpected slowdown in factory output and lackluster retail sales and investment. >> it was a surprise. they could still move. they don't have to move the

money out of the fed, but leaving that aside there is a , view we had a soft numbers out of china, indicating some moderation is going on. at the same time, the pboc governor speaking to shanghai, making poignant remarks for the need for financing smaller to medium-size companies. so the takeaway is, the pboc could yet move, but perhaps the broader focus is not on overextending or over tightening too much, and to make sure that is enough juice flowing through the wider economy. come for the soccer, stay for the oil diplomacy. russian president vladimir putin and salman are discussing a game plan for next week's opec meeting. saudi arabia's oil minister today expressing optimism that would production will be reached. he said, i think we will come to an agreement that satisfies, most importantly, the market. i think he will be a reasonable

and moderate agreement, but nothing outlandish. >> they will definitely raise production. but the question is, by how much? my guess is, it is about one million barrels a day they increase because they will try to offset declines from venezuela. they are at a crucial tipping point because they are at a point where demand construction could take place and they know that. they need to balance things, and they realize opec is once again relevant in the oil market. they'll want to play this very carefully. >> argentina has named a new central bank chief after the surprise resignation of its chief. is argentina running out of options? >> it looks that way, doesn't it? because they have done pretty much everything they can in this current phase of the peso's weakness. they have a $15 billion standby loan from the imf. they raised interest rates substantially a couple of weeks

ago to 40% in one 600 basis point move. now, they are having ahead change of the central bank -- they are having a head change at the central bank, someone who had suffered a little on the popularity front and in terms of credibility from investors, as well. >> former trump campaign chairman paul manafort sent to jail by a judge. mr. manafort has been accused of many things, including money laundering, but he is going to jail today because of something else. >> yes. within the last several weeks, paul manafort was accused of witness-tampering, and that is why he is going behind bars today. that court order coming in the last hour. this is the most monumental development so far, and the most notable fate of someone close to president trump's political orbit. now going to be sitting in a jail cell. we can't understate that enough. ♪

♪ rishaad: you are watching "bloomberg best." i'm rishaad salamat. david rubenstein is coexecutive chairman of the carlyle group. which won't its fourth student this week with tim cook as special guest. he is uneasy about the rising level of government debt. >> we are running a $900 billion deficit this year, next year maybe $1.2 trillion. we could see a $2 trillion annual deficits if we don't get the growth waits the government is projecting paragraph 20 when trying dollars of debt and we could in a decade gets 35 three dollars of debt.

that is something the federal reserve has to work -- worry about. i don't think the wall street traders and bond people are as concerned as maybe they will be in a year or so. you never know when these things will come back to hot you. right now it is something to watch and the fed is worried about it. re: underestimating or overestimating the strength of the u.s. economy? orare we underestimating overestimating the strength of the u.s. economy? what are they getting wrong? know.is hard to we are growing at close to 3%, which is pretty good for the economy of our size. the biggest concerns people would have is the debt they were growing and how much longer can we continue this? where 109 months into a growth cycle. point would say at some this will slowdown. what cause it to slowdown question is it emerging debt? is it tier four's? or growing --

is it tariff war's? the nextcauses recession to occur, it clearly is something we can see in front of us now. we just do not know which of the things i mentioned are likely to cause it, or maybe geopolitical factor. at some point, will have a slowdown. famously said, is something cannot keep going on forever, eventually it won't. this growth cycle has been terrific. or two, ther year recession has been pushed back because the tax cut bill and favorable economy for at least a year if not longer. >> coming up on bloomberg best, more of the week's top of the news and conversations on two of the weeks topics, the north korean summit in singapore and central banks. >> i think they are taking the opportunity to normalize interest rates. i have to say personally that is

something i welcome a lot. this is bloomberg. ♪ what's a gig of data?

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rishaad: welcome back. there were plenty of promising optics at the u.s.-north korea summit in singapore, although few details were resolved, and the negotiations still remain. bloomberg television spoke with several experts on geopolitics and global diplomacy about what the summit achieved, and what lies ahead. >> i think people are overanalyzing this. we have a framework now for discussions. the one, i think, significant benefit we have that no one is talking about is a reduction in tension. i haven't heard president trump mention fire and fury. and i haven't heard the north

koreans talking about turning seoul and washington to a sea of fire. we have had a significant reduction in tension. is of value. nobody is talking about the brink of war. i haven't had anybody saying that they were saying it a few months ago. this is just the beginning. the devil is in the details, no question about that. we will know when we get the north koreans to the negotiating table how we move forward. there's a lot of heavy lifting to be done, and i think mike pompeo will have a significant amount of work to do. like i said, this is just the start of a very long journey. there will be potholes and speed bumps along the way, but i think it is fair we should test north korea's diplomatic intentions and see if we can come up with something that will advance american interests in the region. >> when you boil it down, what did the u.s. or its allies get, with the suspension of u.s.

rok military drills? this is something that caught south korea and its government offguard. >> that was a surprise to me, too. i think most experts felt that we should not trade our legitimate exercises with an ally for commitments from the north koreans. we think they shouldn't do that. i was surprised that that. i think it is a mistake to make such a move without consultation, without allies. -- consultation with our allies. we will have to see how that works out. the president uses a vague term, war games, i don't know whether he means all military exercises, all joint exercises, or just certain exercises that improve the movement of a great deal of equipment. this is something that needs to be worked out and certainly

requires consultation with south korea and japan. i'm glad that pompeo went off to consult with our allies immediately after the meeting in singapore. >> on the plus side, let's give president trump and kim credit for meeting and for having a collaborative session. the atmosphere was very good. on the question mark side is will kim actually perform as he indicates and move toward denuclearization? on the negative side for the u.s., is if there are moves to take u.s. troops off the peninsula or cancel military exercises absent similar and equivalent moves from north korea, that's a loss for u.s. and u.s. allies. >> how about the other, peripheral parties in this, watching from afar? did china get a good victory here and is japan asking what we have here? >> i think china

would say anything that reduces u.s. military presence in the region is good news. and secondly, any step that reduces confidence in u.s. allies in u.s., if it surprises south korea, if there wasn't a consensus, then we gave a good friend a shock, and that is good news for china as well. you have to manage a relationship. >> my concern, of course, is the south korean relationship. i think we have to be very careful not to create a situation where south korea thinks we were taking them for granted. a lot of people have pointed out that the south korean president is very concerned that the show goes on. this is something he pushed for. but he is equally concerned about showing to the south korean public that he can manage the u.s. relationship. there's a major disconnect like this, and that's not going to help him. so i think it is appropriate that secretary pompeo go to south korea first.

there are also big issues for the japanese, who have some real concerns about the fact that there's nothing in the agreement about missiles. and finally, if this is ever addressed, and if we really get traction with north korea, and we look back and say how do we do this, i think china will be part of that picture. i think that is also something the administration has had trouble getting their minds around. rishaad: central banks and central bankers were another focus of attention this week, with policy decisions coming from the federal reserve, the ecb, and the bank of japan. here's some of what distinguished guests on bloomberg television had to say about developments in monetary policy. >> i want to get your initial reaction, not so much to the 25 basis point hike, because that was expected, but the hawkish tilts from the fomc and the expectation that there might be

four hikes total through the end of the year. >> right. well, when you read the statement, the language, especially in the first paragraph where they describe the economic outlook for the next tee years or so, lots more hawkish wording. but what was striking to me was when you go to the numbers, the projections that the various fomc participants provided, really not much changed at all from the last time they did a dot plot back in march. it's not much. it's true that the sequence of dots for the current year, 2018, now suggests that there are four rather than three, but that is just the movement of one dot. when you look forward at the projections, their projection for gdp growth really peaks in 2018, then there is a

deceleration in 2019 and a further deceleration in 2020. the unemployment rate comes down a little more, so that's a little more robust. but the inflation rate is flat throughout this period. really, not much changed in the numbers themselves. so yeah, it is a somewhat more hawkish tone overall, but is especially when you look at the numbers, it's not a hugely hawkish position, in my view. tom: let us talk about the institution we observed yesterday, the central bank of the united states. boy, are they trying to get out front of the data and game and guess. within your years of research, can any central bank do that? >> well, i think what's unusual -- it's difficult to look back to the past and to find a clear

model of this. i think that they are taking the opportunity to normalize interest rates, and i have to say personally, that is something i welcome a lot. perhaps here, we have missed a few chances to do that. my concern is that when we do next enter a downturn, the central banks don't have a great deal of ammunition. the more headroom they have to respond if we do have a more serious market situation or economic situation developing, the better. i rather welcome what the fed is doing. it is clearly a little bit risky, but as they point out, monetary policy is still quite accommodative at the moment. i'm in favor of what the fed is doing. vonnie: emerging markets benefited, really, from this decision and this press conference today by the ecb, and almost from the fomc decision yesterday. how does the divergent story play out now in the next three to six months?

>> one of the things we are seeing is one of the ramifications is dollar tightening. when the global economy was doing so well last year and outperforming the u.s., the fed could raise rates in the dollar was weakening. now when the fed raises rates, the dollar will strengthen. that's an additional form of tightening, an additional form of potential pressure in terms of dollar funding globally. there is some tightening of conditions globally, fed tightening is starting to be felt. it's proceeding as planned. they want to tighten policy, they want to cool things off. it is working more outside the u.s. than inside the u.s. right now, but that means we should probably continue to see the dollar strengthen through the year as they proceed with rate hikes. mark: why would there be an urgency to make a statement on rates? the economists we surveyed before today said it wouldn't

come until december. why did he feel the need to make an announcement on rates, or give guidance on rates? >> i think maybe he wanted to push back the rate hike expectations because of what he mentioned about the external environment, the geopolitical situation, the soft data in the euro, especially compared to the u.s. i think it made the balance smooth. in qe on the other hand, not being too hawkish and not moving too far from the interest rate. i think expectations, given the way the council gave some space, to move next year. i think this is the main reason. i want to see more data from the euro area, more positive data, and i think they want to see how the u.s. develops and whether or not this affects the euro area. as you mentioned the forecasts , are not taken into account at the moment.

♪

rishaad: you are back with "bloomberg best." i'm rishaad salamat. let's resume our roundup of the week's top stories with an emphasis on company news, starting with a significant announcement from electric carmaker tesla. >> tesla titans. the electric carmaker plans to slash around 9% of its workforce. the ceo, elon musk just tweeted , this, saying it is part of a, "difficult but necessary we organization. just to be clear, this is salaried staff and does not include production associates." is that right? >> that's right. when he explained this in his letter, he made it clear it is not production workers.

the model 3 won't be disrupted, they won't pull people off the assembly line, anyone who's directly involved in the production of the car. maybe some of the support staff around it might be touched, but it will not be production workers. >> thereby answering the question all investors have, which is will this affect the production targets for model three? no. >> that is what he is strongly saying. >> daimler has been ordered to recall 774,000 vehicles in europe following an accusation it used illegal devices in its diesel engines. the move follows consultations with the german government in berlin yesterday, which the ceo called constructive. the carmaker escaped more costly measures, such as fines or a hardware fix that has been very important to the auto industry and the german government. >> the cost is very low. it will cost them something like $75 million, $80 million max. the software will be approved by

the german authorities. we have seen that before, in multimillion vehicle recalls from audi and volkswagen. they have a solution now. they make peace with berlin and , they get the cars properly fixed. >> shares in chinese telecom equipment maker zte took a dive after it agreed to pay at least $1 million in penalties and overhaul its management -- one penalties ands in overhaul its management. this as part of a settlement that allows it to resume business after two months hiatus. apart from the billion-dollar fine, what are the implications for zte? >> well, $1 billion is an extra fine, and to put that in context, that's about equal to four years of operating income at zte. beyond that, the implications are that they have to fire their

whole board of directors, all of them have to go, according to the deal they signed with the u.s. department of commerce, and they need to get rid of all their senior management. anyone in a senior vp position or higher. in addition to that, any staff or executives involved in the deals that sold equipment to iran or north korea. that's a got them into trouble in the first place. i calculate we are talking 30, 40, maybe 50 different people could be caught up and fired from the company. that's quite a lot, and would make it difficult for zte to get up and running quickly, even if the sanctions are lifted against them by the u.s. department of commerce. quit -- >> -- has agreed to buy envision health care. it's a provider of physician services to hospitals. it's been a long time coming. walk us through how it has done. >> sure. this is really the culmination of a month-long strategic

review. it started last october. one activist disclosed a stake in the company and was pushing for takeover options. the company said today that throughout the strategic review it contacted 25 different , potential buyers, including carlyle, onyx, different consortiums. united health was also considered as a potential buyer. and kkr emerged as the leading bidder, and we will see where it goes from here. >> the rolls-royce is said to be cutting 4000 jobs as they try to simplify their business in boost -- and boost profit margins. the retrenchments would bring the total number of jobs to nearly 10,000 since 2015. >> we know that they will focus predominantly on hq. rolls-royce has already said they are looking to shift their headquarters in victoria to central london, which will help

them shed costs. but on a bigger scale, the bigger question, why now? i think the ceo, who came in about three years ago, has been quite frustrated by the lack of progress that rolls-royce has managed to achieve in terms of the turnaround. this is kind of a crucial next step in what they hope to achieve. >> hainan airlines plans to raise a billion dollars by selling shares to investors. this is part of a restructuring plan. they are offloading up to 20% of its listed shares to 10 investors. what is this money going toward? >> hainan has been in this really aggressive expansion mode, flying to nonstop destinations in the u.s. and europe. obviously, this money they will be racing from their shareholders will help them in buying planes, and probably addressing some of their pricing

going forward. >> -- stock fraud. muddy waters was involved in $20 billion in overseas stock exchanges. today he is back with another. >> so we are short tal education group, which is a china-based core -- for-profit education company. the stock is up some 2500% in the past five years. you say it's a fraud? is that right? >> yeah. it's a real business, but its profits are fraudulent. when you look at the appreciation in stock price, some people might say, why would they do this? i would point to the value of the chairman's holdings. three years ago, his holdings were only worth about $900 million. today, they are getting close to

$8 billion. there's your answer as to why. to be clear, it is a real business with real students in real learning centers, it's just not able to grow nearly as profitably as its been portrayed. -- as it has been portraying. >> qualcomm has cleared the last hurdle for its $43 billion-dollar takeover of nxp semiconductor. bloomberg has learned that chinese regulators have okayed the deal that has been pending for more than 18 months. acquiring it means qualcomm can lessen dependence on the slowing market for smartphones. >> we understood china had approved the deal, which is important to qualcomm. is it in jeopardy? >> it could be. this deal has been a political football between the united states and china for some time, at least that's what qualcomm believes, although there are legitimate reasons for antitrust authorities to look at the combination. it's a little bit ironic, too,

because qualcomm has blamed the u.s.-china tensions for holding up the merger, but at the same time, qualcomm has also benefited from u.s.-china tensions because it's squashed this hostile takeover broadcom was trying to do for qualcomm. qualcomm has been on each side of this divide. ♪

>> we are getting the first live pictures. if you are a bloomberg user, go undo your reckitt. be you can choose who will the winning team. >> there are about 30 thousand functions on the bloomberg, and

we always enjoy showing you are favorite on bloomberg television. maybe they will become your favorite. here's another function you may well find useful, quic go. it will lead you to quick takes, where you can get important context and fast insight into timely topics. here's a quick take from this week. >> after the end of the korean war, north korea was virtually cashless. everyone worked for the state and was provided for by the state. and in the communist bloc context of the day, it worked. in 1989, north koreans were more than twice as wealthy as their comrades in china. >> now we think of them as a hermit people. >> william brown spent his career analyzing north korea for the cia. >> they were integrated reasonably well into the soviet plan system of countries. >> the loss of support from the soviet union after its collapse in 1991 led to a series of great famines in north korea. >> the famine pretty much ended

help -- the public distribution system, in which the north korean state fed everyone through the ration system. the government couldn't supply food, so people went off on their own. >> since then, a strange hybrid economy has emerged. part government controlled, where rations are allocated by the state, and part graymarket, where currency is earned in the market economy. for example, a textile worker in the state-run textile mill earns around 3000 won per month, which has a street value of about $.40. but the worker pays nothing for housing, utilities, and receives food rations. her sister might legally work for an export company. she's allowed to get 30,000 won per month, with fewer perks. another sister could work for a chinese company and earn 300,000 won per month, but with zero perks from the government. >> all state workers get paid through this incredibly low wage

system and are dependent on rations. the ideal situation is for one person in a family to work in a state system, and other people in the family work in the marketplace and earn real money. >> it's a highly inefficient system, and per capita income, north koreans are eight times poorer than chinese and 20 times poorer than south koreans. rather than reform, the government sought to fill a shortfall of hard currency by trafficking illegal goods abroad. according to numerous reports, this illegal business is run by an agency known as office 39. >> it's an office that organizes principally to raise u.s. dollars for the ruling kim party. >> a study from a washington-based human rights group traces the criminal ventures back to the 1970's, when about a dozen diplomats

were expelled from scandinavian for smuggling. countries later, the government switched to foreign organized crime syndicates to sell things like counterfeit pharmaceuticals and heroin, manufactured from state-mandated poppy farms. north korea's government has dismissed such claims and some , analysts have also questioned it. since 2005, intercepts of north korean smuggling have fallen sharply, though more recently, claims of cyber theft have proliferated. meanwhile, kim jong-un has started speaking to south korea, about opening up for investment in restricted economic zones, and is talking about switching to a more china-like economic system. whether that is a true change of heart or a tactical retreat in the face of sanctions remains to be seen. rishaad: that was just one of the many quick takes you can find on the bloomberg terminal. you can also find them at bloomberg.com, along with all the latest business news and analysis, 24 hours a day. that will be all for "bloomberg best" this week. thanks are watching.

-- thanks for watching. i'm rishaad salamat. this is bloomberg. ♪

♪ david: you get a call from steve jobs. tim: there was a sparkle in his eye that i had never seen in a ceo before. david: did your friends tell you this was not a good idea? tim: they told me i was nuts. david: warren buffett still uses that flip phone. tim: i told him i will personally come to omaha to do tech support for him. david: you exposed your own personal life a bit. tim: i thought i was making the