guy: coming up on "bloomberg best," the stories that shaped the week in business around the world. a banquet of news from central banks gives markets plenty of decisions to digest. >> keeping low rates in place for an extended period of time. >> this is the right decision for the economy given the track it is on. >> the plan for rate increases is being further cemented. guy: lots of noise and some ggressive signals around trade and tariffs. >> and they also said they believe in negotiations. >> don't underestimate president trump's determination to push through. i'm just telling you. guy: earnings season rolls on

with another raft of results. >> we remain disciplined and conservative in our original estimation. >> a new manufacturing footprint. >> feet on the ground, people are pleased. guy: a new firm with bold ambitions and high hopes. >> i have a feeling it will be a slow grind and pop. guy: plus, expert insights on trending topics in business and finance. >> we will see volatility and expect some pullback. >> i'm not sure if america is really serious in negotiating a trade deal. guy: it is all straight ahead on "bloomberg best. ♪ guy: hello, and welcome. i am guy johnson. this is "bloomberg best," your weekly review of the most

important business news, analysis, and interviews from bloomberg television around the world. let's start with a day by day look at the top headlines. the previous week posed a selloff in tech stocks and the decline continued monday. >> tech stocks are falling, sliding after silicon valley favorites including facebook and netflix delivered disappointing results. looks like a three-day selloff on the nasdaq composite, now 3.8%, the most since march. > i would describe this as the karma quarter. if you could look at the pent-up ill will toward these names, it almost correlates with the drop. the tech sector got out a little over its skis and the market was ready to unleash some fury, pecifically on facebook.

>> the question is whether there is a re-rating of tech names or if this is a bump in the road. >> it looks to be a fundamental change. not only the broad-based selloff in tech, but some rotation within the tech names. this was a crowded trade. we knew that. hedge funds have piled into this, pension funds have, a huge retail set of investors pile into this. when people start heading for the exit, everyone else goes out the door with them as well. >> the bank of japan has left its key interest rates unchanged while announcing policy tweaks. governor kuroda and colleagues said they will maintain the 10 year bond target at 0%, but will be more flexible in bond operations. analysis says this is the longest wait since september 2016 when yield curve control was announced. this seemed like tweaking around the margins, but what were the important tweaks we need to pay ttention to?

>> the flexibility in bond markets operations, july 20, all kinds of press reports in tokyo including from bloomberg news, that this debate was underway. they need to allow the 10 year yield to go even above 0.1% because of the negative side effects this was happening on the bond markets, regional banks dealing with a flat yield curve. that came through. even though there was a big debate, that is why they had to debate at least an hour longer than they usually do because they had to come to some decision and how to communicate it. very important, as well, they said they would keep this depending on conditions in the economy and markets, but they will keep these low rates in place for an extended period of ime. that is the forward guidance they added. that is the federal reserve sending the signal, this is a policy that is going to be around for a while. >> apple jumping in extended trade after delivering an earnings beat in the third quarter and a strong sales forecast, high-end iphones and

services. let's start with the good. >> higher revenue, 53.3 billion, iphone sales up 23% year-over-year, strong sales in the services and a clear path forward for the services segment for apple. wearables up 60% year-over-year. very strong all-around. some bad news, mac sales, the lowest unit sales reported by apple since the third quarter of 2010. that is revenue down 5% year-over-year and ipad down 5% year-over-year in terms of revenue. >> according to a bloomberg scoop, china and the u.s. are aiming to restart trade discussions after a nearly wo-month stopgap, possibly averting a full-blown trade war. this comes as the treasury secretary steven mnuchin and the vice secretary of china held

conversations on the matter ahead of the next wave of tariffs set for this week. >> anything agreed so far? >> nothing agreed so far and i would note this is also still under discussion within the cabinet in the u.s. what we are talking about right now is really the logistics of who will talk to who? when will we talk? where will we meet to talk? nothing has been decided. for example, will the president of the united states and the president of china get involved because we are at the point where it needs to go to the highest levels if talks are supposed to move forward and avert a full-blown trade war. these are the questions being discussed in the u.s. cabinet as we speak. >> the united states threatening to more than double planned tariffs on chinese imports. china warning the u.s. to stop blackmailing and pressuring it over trade. >> what a difference a day makes. president trump hitting back

against china. china also hitting back this morning saying "if the u.s. takes measures to further escalates the situation, we will surely take countermeasures to uphold our legitimate rights and interests. that is from the ministry of foreign affairs. they say they will not be "blackmailed." >> for all their strident rhetoric, they say they believe in negotiations and that the solution is if both sides meet on the basis of equal respect. perhaps a hint from china that they are willing to come to the negotiating table. >> we are moments from the fomc decision. there is a lot to chew on for the central bank, including a 4.1% print on gdp in the second quarter. we have fallout from the ongoing trade war as well as changes, tightening in financial conditions. >> there is no new trade on this one. no change in rates and no change to forward guidance. the phrase monetary policy remains accommodative and there is no reference to chairman powell's july 17th testimony

that gradual rate moves are the plan for now. >> the biggest issue is growth is not just solid, but strong, acknowledging that both consumers and investment are picking up. >> their comments around growth indicate they think things are getting stronger. what it is telling us is the plan for rate increases is being further cemented. >> the bank of england, presenting a united front. policymakers voted unanimously to raise rates and governor carney indicated brexit could lead to policy being adjusted in either direction. it has been interpreted as a dovish height. >> i think that is correct. there is a fundamental change in policy. they are starting the slow process of normalizing rates. moreover, they are now starting to focus on the balance sheet. the boe's balance sheet and how they actually start the process of unwinding it.

this is not going to happen right now. it is something they are discussing again. it is a fundamental change from where we were a few months ago. >> the important thing is, this is the right decision for the economy given the track it is on. there is a wide range of brexit outcomes possible and we all hope that by the end of the year, we will all be much better informed on which path the u.k. and eu are taking. >> golden apple. the iphone maker has just become the first u.s. company with a market cap of over $1 trillion. apple crossed the threshold this morning when stock passed over $207 per share. >> a trillion dollars is a psychologically important number and shows how far apple has come n 40 plus years from a company that nearly died in the 1990's to a company that is the most valuable public u.s. company in history. >> hiring cooled in july with

150,000 jobs added last month, less than estimated. annual wage gains holding steady at 2.7%, the jobless rate 3.9%. >> i don't think there is any reason for alarm when you look at the top line number. private sector is up 170,000, the numbers will be volatile month-to-month. we will have to see a ratcheting down eventually of job growth to around 100,000, 125,000 a month given our demographics, given what we are doing with our mmigration policy, given the aging in the workforce. i think this is in line with the other economic indicators. >> china, punching back on trade, and announcing plans for tariffs on $60 billion of u.s. goods. >> the chinese are saying they will increase between 5% to 25%. wilbur ross on fox earlier saying "the reason for the tariffs to begin with was to try to convince the chinese to

modify their behavior. instead, they had been retaliating, so the president now feels it is potentially time to put more pressure on. >> i am going to make the case that they are in a weak economic position. that is not a good place for them to be vis-à-vis the trade negotiations, first point. econd point, they better not underestimate president trump's determination to follow through on our asks, ip theft, no go. forced transfer of technology, no go. nonreciprocal trading on tariffs and nontariff barriers, the president has said many times, no tariffs, no barriers, no subsidies. we want to see trade reforms. china is not delivering. their economy is weak, their currency is weak, people leaving the country. don't underestimate president

trump's determination to follow through. i can't speak for the communist party in china. i can speak for our president. do not underestimate his determination to change trading practices on a fair, reciprocal plane. guy: still ahead as we review the week on bloomberg best, mike speaks exclusively about his latest venture, a merchant bank focused on cryptocurrencies. plus, the u.s. treasury unveils its refunding strategy for the coming quarter. next, more of the week's most interesting earning reports. european banks announce results and top executives explain them. >> compared to a year ago, the economic context is less favorable. uy: this is bloomberg. ♪

guy: this is qut bloomberg best." >> credit suisse's chief executive is giving investors reason to stay with a bank through its restructuring process. private banking on the swiss unit compensated for a little trading weakness. >> we are very much focused on -- more than 60% comes from our -- and that is the heart of the strategy. we need to bring institutional like advice and services. we have created a joint venture between wealth management. 25% in the second and ccelerating. that is a good spot for us in these results. >> barclays reporting better than estimated second-quarter results. the ceo telling bloomberg his turnaround strategy is paying

off. >> one of the best quarters we have had in years to generate a 12.3% return on tangible equities is a great result. over 1.4 billion pounds of after-tax earnings. across the board, barclays' u.k. consumer business did quite ell. the corporate and investment banking well, particularly the investment banking side and the markets business. uy: socgen's investment bank showing signs of emerging from the doldrums, better-than-expected second-quarter earnings, income from financing deals and trading topped estimates. >> there are risks and that is why we might not be that far from the and of the cycle in the u.s. and that is why we remain conservative in our risk-taking and it is reflected across our risk, which is low across the board.

>> bnp paribas reported second-quarter profit, beating estimates. revenue falling 17%. are you disappointed with the performance in the fixed income side of the business? >> you have to take into account a negative effect and also the fact that compared to a year ago, the economic context is less favorable in particularly in europe. nevertheless, the bank keeps on ontinuing its transformation plan ramping up to 2020 and continuing sustainable finance. >> standard chartered, one of the biggest financiers of global trade, has reported a 34% increase in pretax profits for the first half of the year, that beat analyst estimates. the chairman also played down he trade war threat. in a statement, saying its direct exposure to the risk of u.s.china trade tensions is

limited. talk to me about cost. this is what investors are worried about. where will you spend the money in the future? >> cost is a second order issue. we are improving the profitability of the business. eturn equity is up, which is where we wanted to be. the costs were up about 7% year on year, a little less than the constant foreign exchange basis but that was very deliberate. we brought forward investment to improve the business and for the full year, we would expect to be at a similar level in the first and second half. >> bp reported second-quarter results that beat estimates the numbers come a week after the oil giant announced it would buy bhp shale assets for $10.5 billion. >> we exceeded results, and were -- our gearing is coming down, gave us the confidence to raise the dividend for the first time in 15 quarters. good momentum and people are pleased. >> what are you hearing from

investors about the deal? >> initially, people were concerned we would break our financial framework and the message that we would structure this and we would stay within the $15 billion to $17 billion capital framework and continue to divest assets to offset part of this deal and increase distributions for shareholders. discipline is the main word and we are still planning the company in the 50 to 65 range rather than these higher prices. >> samsung, confirming profit and sales falling short of forecasts. the demand for galaxy devices hit and rivals in china ramping up competition. why the miss? >> the galaxy s9 sales missed estimates and other than that in terms of sentiment, samsung cut down the number of models available, probably a way for them to streamline their operation and at the same time,

rising competition from the chinese headsets. hat is why, in terms of both shipments, second quarter is quite a disappointment. >> baidu posted a strong set of results despite a string of xecutive departures. walk us through these figures. >> it looks like things have basically matched or beaten expectations on the top line and the bottom line. that is good news for baidu because it lost its chief operating officer and group president not long ago. he quit after less than two years on the job. baidu is a company that remains in transition. it has only recently started shedding units that don't make any money, such as food delivery, and really concentrated on its core, which is technology, using things like artificial intelligence to try and make money. there is still plenty of uncertainty for baidu to come but this is a good sign things

are still on progress. >> volkswagen was a rare bright spot in july u.s. auto sales, jumping 13% for a seventh straight month of growth. the ceo said the carmaker needs a titanic effort to meet global delivery targets this year amid trade tensions and stricter emissions rules. x to adapt to new trade policies, to adapt new manufacturing footprint is hugely costly. so i would be very happy if trade and tariffs could remain on the same level and i am really thankful that those negotiating partners are really ooking for a solution. >> tesla shares surging in late trading after second-quarter results missed estimates, but revenue beat expectations. the electric carmaker burned through $740 million in the

period, but that was less than the $900 million analysts predicted. the headline seems to be the words about sustainable profitability and cash flow positive, but is it possible? >> absolutely. the big question on profitability is when will they start making investments in these future products? elon musk has talked about a smaller suv than the model x and a pickup truck, a semi, a chinese factory. all those things cost money, but it appears the big expenses aren't going to come until next year. maybe he will be able to swing it. ♪

♪ guy: you are watching "bloomberg best." i am guy johnson.

cryptocurrency merchant bank galaxy digital traded on wednesday on toronto's venture exchange. it could be a milestone moment for the industry and for the company's founder. the former goldman sachs partner discussed his plans for the business when he talked to bloomberg's erik schatzker in toronto. > our real purpose in the long run will be to help raise capital for people in the system. the crypto revolution, this decentralized movement will not fulfill its destiny with $300 billion of market cap. it is going to need lots of capital and we want to be the credentializer who raises capital. asset management is doing great. we have $450 million under management. external capital. we have a $325 million venture

account that operates around the eeoc ecosystem. it was a specific mandate. we have a cash management account and we have our bloomberg galaxy crypto index fund, which tracks the index we set up with bloomberg. erik: a year from now, how much will you have in em? >> i hope a lot more than we have now. erik: of course you hope, but i am trying to get a sense of what the ramp looks like. >> we will not raise another venture fund because we have venture on our own balance sheet and this eeoc venture fund. i think the bloomberg galaxy index will be one of those things where you are grinding in money and it hits an inflection. we are spending tons of time educating institutional investors about the space and we are hoping that all that elbow grease and education comes back when they start buying. this is a really good product for institutional investors. i have four sales guys, i call

it the boiler room. they are on the phone, traveling all around the country and the globe, sitting with people and saying this is how it works. this is why you should invest. this is your first step in. we raised more money this month than last month and i have a feeling it will be a slow grind. then it will just pop. guy: that was galaxy digital mike speaking to bloomberg's erik schatzker. bloomberg lp owns and operates the bloomberg galaxy crypto index in partnership with galaxy digital. coming up, more of the weeks compelling conversations. if you are having trouble figuring out where markets are headed, you are not alone. ubs investment bank's chief says there is plenty to be confused about. >> how do you price trade wars?

how do you price brexit? how do you price protectionism? guy: this is bloomberg. ♪ two, down and back up.

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simple. easy. awesome. stay connected while you move with the best wifi experience and two-hour appointment windows. click, call or visit a store today. guy: welcome back to "bloomberg best." i'm guy johnson. throughout the week on bloomberg television, leaders in business and finance have offered their perspectives on the most important issues facing the global economy and financial markets. let's begin our roundup with top interviews with the president of ubs's investment bank. francine lacqua asked about his outlook for the second half of the year. >> we're going to see more volatility, we expect to see some pullback, but to finish the year up. >> but you are not predicting a recession, that would be the end of the cycle coupled with the central bank or anything like that? >> at this point in time, absolutely not.

>> what do your clients ask of you? >> i think it's the difference between an economy and a background that is very buoyant, and markets which are a lot more volatile, and how do you navigate that? specifically in europe and in the u.k., events that are keeping this block behind the u.s. in the emerging markets. >> if you look at m&a in europe, how is that going? >> it is going quite well. people can extract synergies reposition their portfolio, improve their prospects, become more efficient by merging and taking out cost or refocusing the way they do business. that has been quite good, and actually, we are said to have a -- we are set to have a record year this year. europe in particular is driving that trend. so i do think the fundamentals are quite good. it's just that, day after day,

the market environment is quite volatile and filled with uncertainties that we don't know how to price. how do you price trade wars? how do you price brexit? how do you price protectionism? how do you price events in italy over the budget? you try to price them, but it's difficult to forecast and adapt to. >> the trade war is a two-edged sword. first of all, if it is only between the u.s. and china, i don't worry that much. i think trade is a very rational thing, there's a lot of room to negotiate. as far as nontariffs, who knows what they are. in the end, china may be ahead. on the tariffs, i believe they will be very happy to make donald trump look good, but what about all the non-tariff stuf? who is winning? who knows? i think if it is just between the u.s. and china, but what i do worry

is donald trump is picking on everybody, mexico, europe. and when that happens, it can disrupt the supply chain in the world, and that is dangerous. it reminds me of 1920's. that is how the great depression came about. i think it's important that donald trump knows how to stop, and don't just pick on everybody. >> do you think this is going to continue through the midterm elections in terms of election posturing, or do you think there will be some push and pull to a real agreement? >> well, first of all, i don't think donald trump wants an agreement. all he cares about is the midterm election. after the midterm election, it is his own reelection. two years down the road. i'm not sure if america is really serious in negotiating a trade deal. there is so much domestic politics getting in the way. the rest of the world just suffers because of domestic policies in america.

>> when you are looking at the oil market, what are you looking at? what do you think is firmer? >> i think it used to be political, geopolitical uncertainty was not clear. i think everybody is watching this now. you look at the uncertainty in the iran sanctions, what that means for the market. venezuela is a human tragedy unfolding, and that will affect the oil market. you have outages in nigeria from time to time. and you've got tensions coming out of the persian gulf. on the other side of it, demand is keeping up, production is keeping up. u.s. production will rise. it is bottlenecked in the permian basin. there are offsetting factors here. but it just feels like it's firmer rather than softer for the rest of the year. >> out of all the executives that i speak to, you have a really unique insight into what's going on with china. when we first met, you were sorting out the multibillion-dollar trade with

the country. a lot of people trying to understand what's going on, and i'm wondering what your insight is. >> it is clear that the economy is slowing down, as expected, as forecast. at the same time, you saw a few weeks ago, the chinese government deciding to put in a similar system. today, when i look at the others, i do not have any concerns whatsoever. the chinese situation, as far as we see it, is pretty good. my personal experience -- i go there three or four times a year. last time i went with the chairman who controls most of it in china. he was pretty clear in his discussion that the restructuring of the industries are here to stay, which means that china will continue to buy high-quality products. it is a great piece of news. >> do you see them hitting an inflection point, where they start to boost demand by shifting toward the stimulus and pulling away from deleveraging?

is that something you can see playing out? >> yeah, i think it could happen. it could happen, absolutely. they are managing the debt in a pretty good way. i am one of the most optimistic persons on this program. i have been saying it on this program in the past. the economy keeps growing full. 6.7%, if you look at it by any other standards, it is a massive number. >> talk to me a little bit about some of the market reaction today. the pound is down. are they skeptical about your ability to raise rates, or should we not read into it? >> i think many in the market recognize this, certainly the bank of england that the equilibrium interest rate globally is lower than it was previously. there is also, in the view of the mpc, there is a wedge

between the overall level of the equilibrium rates and where it is in the u.k. a lot of that is caused by the uncertainty around brexit, which -- you look at what's happening to business investment in this country right now, it should be on fire. it's just moving very tentatively. take away that uncertainty, one would expect using business as an example that they would adjust quickly to the new realities. investment comes in, you start to move up between the equilibrium level and global rates. so that's the other element. if you're sitting in the market, you have to make a judgment. do i agree with that framework? the crucial thing is, what do i think will happen with brexit and that uncertainty and the impact of the economy? in fairness, a lot of the risk premium that exists in the u.k. assets and a lot of the shorter

term moves in markets are being determined by different views on where the crucial negotiations will go. ♪

guy: this is "bloomberg best." guy: this is "bloomberg best." i'm guy johnson. turning back to our view of the week's most important business headlines, there was plenty of important economic data for investors to analyze. lead by manufacture numbers from china, that came in soft. >> china's official factory gauge weakened this month amid tightening credit conditions and trade tensions. what can we glean from today's data? >> the manufacturing pmi for july came in at 51.2%, down from 51.5% in june. the forecasts have been 51.3%.

nonmanufacturing, but also softened to 54% from 55%. that's the construction and services sector of the economy. it seems there is pressure now on the factory sector in china, domestically and externally. you have this the deleveraging campaign in the first half of the year, really aggressively attacking the shadow banking sector and of course you have the ongoing trade tensions of the u.s. raymond young thinks we will see a gradual slowdown in the second half. that really comes into line with the views of many economists, it seems. >> a lot of data out of europe this morning. we were a little higher than expected on inflation, a little lower than expected on growth. the markets didn't react too much. there are some positive numbers. >> i think it was a headline miss in terms of the economic growth, but it wasn't a miss in terms of the ecb's expectations. if you look at projections earlier in the year, it was half a percentage point, quarter on

quarter. something like that. so for the ecb, it is reasonable news. same thing for the inflation data. a lot of the strength we see in inflation coming through in energy prices, the ecb had been telegraphing that. not a ton that was unexpected. >> turkey trading sharply to the downside this morning, and european stocks exploding. this follows what happened in the united states. yesterday, washington following through on threats to impose sanctions. this after the detention of an american pastor. >> the lira is hitting a record low against the dollar. istanbul is down, and the worry of investors is that this is the first step, and there will be more sanctions to come. what the u.s. wants is for the u.s. pastor to be released, but

ankara is refusing to do so. what more is there to come? investors are already concerned about the central bank's independence, and they are not doing enough to rein in inflation. now they have sanctions as well. >> the u.s. treasury has unveiled its latest refunding plan, with a total of $78 billion in sales. the move is sending the 10 year treasury yield above 3% for the first time since mid-june. this is the third consecutive quarterly increase. give us some details. >> what the treasury decided to do was issue $3 billion more in two-year notes and three-year notes, and that will over time probably have the effect of flattening the curve. there's going to be more short end issuance. the other interesting thing was come october, the beginning of the new fiscal year, they will be issuing new bills, another instrument to raise more money.

given how high deficits are. >> facebook says it has identified an ongoing effort to influence the u.s. midterm elections. the company shut down a number of inauthentic accounts while the investigation continues. what's the latest on this? how extensive is this effort that facebook has identified? >> we are being let in on this effort in the very early stages. this is earlier than they would bring people in from the public, but they have been informing congress, the fbi, they have been trying to work with the government to figure out who's doing this. i think the biggest question is what was the actor behind this? we don't know enough yet, or facebook tells us they don't know enough, to say whether this was russia. of course, a lot of congresspeople and senators are saying they believe this is russia. >> the trump administration rejected canada's bid to join

high-level nafta talks with the u.s. and mexico this week. the country's attempts to join the negotiations were either ignored or spurned by the u.s. trade representatives. president trump has suggested he might go for a bilateral trade deal with mexico before turning to canada. so what's happening? is a bilateral or trilateral? >> if we got a deal by august, it would be a bilateral with mexico. it is probably not going to be a full deal, it might be an agreement in principle. the mexican government is in a transition period with a new president taking office december 1. the old administration would like to get it off of their plate. the new administration would like to not deal with it when they come into office. there's motivation to get something done with the mexicans, but there isn't with canada at this point. the u.s. feels canada hasn't done enough to come to its position, and if they can strike a deal of mexico, they feel it will put pressure on canada to make concessions.

>> will cbs sideline its chief executive? the board is meeting today to discuss the future of les moonves, following sexual allegations posted in the new yorker. what are we expecting out of today's meeting, and how long does les moonves have had the company? >> sherry whetstone has said she wants there to be a thorough and open investigation. she's not calling for him to be sacked right away. we expect they will hire an independent law firm to carry out the investigation, and also appoint specific members of the board who will be in charge of the investigation. >> the cbs board met today, decided at this point it is not going to make a decision, and is exploring hiring a counsel to head up an independent investigation. but for him monetarily, what could he stand to lose if indeed he would be let go? >> there's a lot on the line for les moonves. just last year, he signed a new

employment agreement that spans through mid- 2021. if it were that he steps down tomorrow, or if the board decides to fire him for cause, he could lose out on as much as $300 million. >> the china tower has become the second high-profile company in a month to price its hong kong ipo at the low end of the range, with the sale set to raise $6.9 billion usd. it looks like china tower following the footsteps of xiaomi a little bit. is this a softening trend? >> it has definitely been following xiaomi in terms of ipo's posted in the last month. it's highly unusual that two deals of this size priced in july and august -- but compared to deals like six or eight months ago, like china literature, like good doctor,

the reception has definitely wind down a lot. >> starbucks is teaming up with alibaba to strengthen its position in china. they are working to improve food and coffee delivery, and starbucks is hoping the tie up or help stem a red sales declined last quarter in its second-largest market. >> we are in a phase of growth in china where it is about store builds. as we build 600 new stores per year and expand the portfolio, that is where we are growing our reach. this enabling of delivery and weaving this digital experience, this virtual starbucks store, in every alibaba property, that really opens the aperture to reach 500 million active, registered users of alibaba and bring the starbucks experience to them.

>> in february, 2016, a travel brand shipped its first suitcase, and since then, they have sold over 300,000 pieces of luggage. and with $31 million in venture funding, it's ready for more growth. the cofounders described their journey as small to big. >> it's a global travel brand to make travel more seamless and more enjoyable, and we started by selling luggage. with our first product, we wanted something that would make packing and prep a lot easier, to empower you to focus on the travel. we interviewed hundreds of people to get their feedback on how they pack, get to the airport, what they do at the airport. that research turned into product design, manufacturing. within a year, we shipped our first suitcase. >> we started with the carry-on, which was one suitcase in four colors. we went really narrow with the product, and over time, we went to different sizes, more colors,

collaboration. >> the first production line, we made 4000 carry-ons. we thought it was a ton, it was not enough. we were totally sold out within a week. the first year of the business was basically a recurring theme of us underestimating what the demand was and selling out and rushing to get more. we have gotten better at that. >> we are definitely born online, but we found out early on that people really wanted to interact with the brand and the product off-line, and that is how our retail strategy was born. >> right now, we currently have four stores in new york, san francisco, new york and austin. all of our stores are standalone profitable. it's great brand awareness and great marketing. because of the experience, we also sell a lot of suitcases. >> faa issued a new regulation earlier this year that lithium-ion batteries can't be in check bags. our carry-ons all come with a lithium-ion battery in them.

luckily, we made a design change that our batteries popped out, but the earliest versions were removed from the inside. we came up with a way to convert all of those early suitcases into having injectable batteries. we have been able to offer the whole program at no cost to customers, and the response has been overwhelming. they appreciate that we are refitting their suitcases for free, so they can continue to travel. >> since the business has exceeded our expectations in every way possible, there were four of us, and now there are close to 150 people. >> in the next year or two, we are focused on a few things. we are listening to our customers to expand our product line into everything they need to travel. we are also focused on expanding geography. a third thing is expanding our retail footprint. >> what excites us more about the future is the potential to change a lot of things in the travel industry.

there are so many things wrong and the many points -- from where you stay to how you get there, there is a lot of opportunity for us to go into different spaces of travel. >> we want to be the biggest travel brand in the world. if there's any part of travel we can make more seamless and enjoyable, we will do that. ♪

>> check out gtv go on bloomberg, where you will find all the exciting charts we highlight here at bloomberg. if you want to check out the magnitude of the drop in the faang stocks, you can check this out. it is just unbelievable. guy: there are about 30,000 functions on the bloomberg, and

we always enjoy showing you our favorites on bloomberg television. maybe they will become your favorites. now, let's wrap up this edition of "bloomberg best" by noting a business master. this week, apple became the first publicly traded u.s. company to reach a market cap of $1 trillion. bloomberg technology's mark gurman explores what that means. >> after months of waiting, it has finally happened. apple has become the first u.s. publicly traded company to hit a $1 trillion valuation, leaving the likes of amazon, alphabet, and microsoft in its wake, but not far behind. apple's milestone is significant and a testament to the rapid growth spurred by the success of its product like the iphone and ipad, as well as tim cook's leadership after taking over for

the visionary cofounder of steve jobs. >> we are calling it iphone. >> but let's not forget that what is now the world's most valuable company was on the brink of bankruptcy as recently as the late 1990's. that was until the cofounder, steve jobs, returned to the fold. since then, it was one success after another. in the seven years since his death, the company was steered to new heights by launching new devices like the apple watch and iphone x. he has also pushed the company deeper into new services, like apple music. which is now a key revenue driver. and cook and his team aren't stopping there. they are keeping apple on the technological edge. delving into self serving cars, augmented reality and health care. what this he think of its latest milestone? "i don't think about it, that's the truth. i still view apple as a pretty

strong company the way that we operate. i know it's not numerically, but the way we function is very much like that." to grow beyond $1 trillion, apple has to keep churning out cutting-edge smartphones while still finding its next big hit and growing the digital services businesses. a larger version of the iphone x, and a cheaper model with many of the x's features is on the way. beyond that, it could revolutionize personal proceedings, with the big online video push coming soon to an apple screen near you. guy: bloomberg technology's mark gurman on apple attaining a market cap of $1 trillion. you can follow this story and find out more business news and analysis 24 hours a day at bloomberg.com. that will be all for "bloomberg best" this week. thanks for watching. i'm guy johnson. this is bloomberg. ♪

jonathan: from new york city for our viewers worldwide, i am jonathan ferro with 30 minutes dedicated to fixed income. this is "bloomberg real yield." ♪ jonathan: coming up, another solid jobs report in line with the federal reserve's outlook for gradual hikes. trade tensions building. larry kudlow says the president will not back off china. and china stepping in to support its currency, closing in on a record weekly losing streak. we begin with the big issue, another solid jobs report. >> this truly is solid as a rock. >> you had a good jobs report today. >> the big surprise this