♪ mi: -- emma: coming up on "bloomberg best," the stories that shaped the week in business and around the world. >> more tariff trauma as the u.s. and china escalate the trade spat. >> we are hearing china will not engage. >> truth or dare between donald trump and china. >> north and south korea hold nuclear negotiations and the boj on stimulus. >> the doj would be looking at whether any criminal fraud laws were broken. >> the ceo of ubs says his bank is planning for the worst. >> you don't know what is going to happen, how can you invest?

emma: plus, perspectives on global trade from leaders in finance and politics. >> everyone is worried about the trade war and should be worried about trade tensions. >> it is more the impact on sentiment. >> the impacts on investor confidence. emma: and the conversations with the new president of zimbabwe. >> we feel the world is opening up. emma: it is all straight ahead on "bloomberg best." emma: hello and welcome. i am emma chandra. this is "bloomberg best," your weekly review of business news and analysis from bloomberg television around the world. the week began on a familiar note with trade tensions rising between china and the u.s., and reports of another round of tariffs.

>> the u.s. trade spat with china heating up. president donald trump threatening to impose tariffs on an additional $200 billion of chinese goods. china, ready to retaliate. >> president trump tweeted tariffs have put the u.s. in a very strong bargaining position with billions of dollars and jobs flowing into the country and yet, cost increases have been a noticeable. -- unnoticeable. if countries will not make fair deals with us, there will be tariffs. this is one of several tweets the president has tweeted in recent days. >> what we are hearing from our sources is the chinese absolutely will not agree to have any more talks with the u.s. if these tariffs go forward, at least in the short term. there was invitation extended to china from the treasury secretary. we heard there was goodwill on the china side to engage in the fifth round of talks since june -- since may, but if these tariffs go forward, we are

hearing china will not engage and again, we will be stuck in the standstill situation with china, expected to retaliate immediately. >> president trump, ratcheting up pressure on china by ordering a 10% tariff on $200 billion worth of goods and threatening more if beijing retaliates. a pretty fierce statement despite trump saying he has respect for president xi. >> right, but he is certainly trying to keep pressure on president xi with these new tariffs. they are 10% now, designed to give u.s. businesses some time to adjust supply chains and the like. they are scheduled to take up to -- kick up to 25% next year. the have excluded some items from those tariffs, including smart watches, bluetooth devices, children's car seats, and that is designed to ease weight for u.s.

consumers. tariffs effective september 24. i am losing count. where are we? how many goods and what tariffs? >> it looks like we are playing truth or dare between donald trump and the chinese. the president, imposing $250 billion and saying they had $257 billion in reserves. this morning, the chinese said they would go with $60 billion upping their total tariff products to pretty much sends them.he u.s. about 130 billion dollars. this will impact china carried they seem to be willing to put up with it for the time being. a cut from their gdp to 1.5% if the president imposes additional tariffs. >> the offshore yuan has

extended gains. >> china will never go down a path in stimulating exports by uatingaluating -- deval its currency. >> did china's premier offer any concessions to the u.s. in his speech? >> there were a couple of nods to the administration in this speech. you had the chinese premier talk about the need to crack down on intellectual property violations, saying they will be dealt with strictly, saying foreign firms in china would face a level playing field and really, the key takeaway, saying the yuan would not be devaluing. saying that is being used to boost chinese exports is not true. saying devaluing the currency would be more painful than not.

>> eu leaders are meeting in salzburg ahead of a potential brexit summit in november. time is running out. there are issues to be resolved, like the irish border. u.k. prime minister theresa may said she would soon announce a proposal on how to avoid a hard irish border, but gave no details on the plan. >> for sure, we will never accept the deal which will damage the european union and its integrity, for sure. >> what a difference 24 hours can make in politics. theresa may walked into salzburg yesterday hoping to get to the next phase of negotiations, to get a roadmap to a deal but most crucially, to get support from her european counterparts. now it has been the opposite. european leaders have told her , your plan does not work. rework it, it is not acceptable. european leaders have said we

want to see real progress and to do a november summit that would get us to a deal. >> president trump is said to deny exemptions for the latest round of tariffs on $200 billion of chinese goods. >> the white house saying it is giving companies time to adjust supply chains away from china. what is the importance of product exclusions for u.s. companies? is it something that we are not going to get? >> that seems to be the state of the play for these companies that don't want to be subject to tariffs and certainly not the 25% tariffs due in january. that puts pressure on them to source cheaper supply chain and move manufacturing out of china. the problem is, that is easier said than done. moving supply chain is quite a complicated operation. you need to get staff up and running, facilities off the ground. >> it takes years.

>> exactly right, it takes time. most importantly, china offers scales that many countries do not. tariffs inou can say china, let's make it somewhere else. that is more problematic than it sounds. >> we've got a stalemate after salzburg. theresa may this morning saying she expects respect and will push ahead with her plan. >> donald tusk said our plan would undermine the single market. he didn't explain how in any detail or make any counterproposals. we are at an impasse. guy: she looked really cross. >> she was very annoyed and at the end of her short statement, she turned on her heels and walked out. i thought that was emblematic of how she felt. it has been a humiliating week for theresa may. they went in thinking they would get warm words. this is two weeks before the conservative party conference,

which is going to be difficult for her. she wanted to go in showing , and instead the league humiliated her. she woke up to gruesome headlines this morning saying she failed in salzburg and this was her attempt to clawback some of that respect. emma: still ahead on "bloomberg best," reaction from the latest flurry of tariffs from investors and policymakers. plus, liam fox thinks britain will put together a brexit deal and the country's prospects could be fine. first, more headlines. devastating storms hit the u.s. and asia and the costs are likely to be steep. >> these are historic floods. emma: this is bloomberg. ♪

♪ emma: this is "bloomberg best." i am emma chandra. let's continue our global tour of the business top stories. in japan, the central bank stuck to its stimulus script. >> the bank of japan has left monetary stimulus program unchanged after adjusting its policy settings for the first time in two years in july. the central bank maintained their 10 year bond yield guidance on interest rates by all economists surveyed by 51 bloomberg. the decision leaves the boj behind its global peers, who are moving to return to precrisis monetary policy. >> the boj is behind everyone else normalizing but the reality is the boj is tapering. asset purchases are falling. they are not buying as much, but

they have this slightly conflicted policy-setting where they had the yield curve controls and the yield target at an amount to buy. there is a tension between those two things. there is reluctance from the bank of japan to drop their asset purchase target because they are scared of looking like they are tightening too much. >> the big news this morning out of the two korea's meeting was the second round of talks culminating in the military agreement. >> we heard promises from kim jong-un when it came to denuclearization. will he follow through on his word? >> that is the question at stake. if you look at the joint statement released by moon jae-in's presidential office, it mentions specific nuclear facilities kim jong-un has agreed to dismantle and he has also agreed to invite professionals from related states, nuclear experts, other

parts of the military agreement include withdrawing some of the troops -- guard posts along the border separating the two korea's, as well as the military efforts to excavate war remains in the demilitarized zone. we can see kim jong-un stepping up to really achieve the credibility within the international society. >> saudi arabia is comfortable with brent rising above $80 a barrel, according to people familiar. brent rallied on the news. housing advocate is the shift on saudi arabia? -- how significant is the shift on saudi arabia oh? >> the saudi's aren't necessarily going for a $90 oil, but earlier in the year, we saw tweets from donald trump about crude saying he wasn't happy with the high prices opec had created an now the idea saudi's are creeping above $80 and are content to see if there. it is an important shift because

it suggests that in the short-term, the saudi's aren't going to step in and curb brent above $80 a barrel. >> oil, high after u.s. refiners eroded domestic stockpile to a new low. what is the push and pull here? >> what you see is based on u.s. stockpile numbers. we saw opec watching the cushing number with extreme attentiveness before they made their decision to curb production output. what you are seeing is refiners stepping in and chasing the margins while they have them, and you are seeing a lot of exports. it is hard to think of the u.s. as a major oil exporter, but you are seeing that. >> brent, up 1%, the second week of gains. that is before the opec meeting in algiers. it is a joint, technical meeting, however the , conversation will be about

politics overproduction with president trump setting the agenda. he tweeted yesterday, we protect the countries of the middle east, they would not be safe without us but they push for higher oil prices. we will remember. the opec monopoly must get oil prices down. how does opec talk about this this weekend? >> the saudi-russian view is that those that can, saudi arabia and russia, plus others, should take production that others can't make to bring the total to where they want it. the iranian position is that no every country has an individual , target, each country can produce to that target. that is where the tension is coming. what i think we will see at this meeting is the saudis and russians arguing that there is still less production and they -- then they have agreed, there is still more to make up, and this will feed through ultimately into an increase in production again from both russia and saudi arabia over the next couple of months.

>> the saudi arabia sovereign wealth fund has signed an agreement to invest more than $1 billion in an electric car startup that could challenge tesla. we are talking about lucid. why has saudi arabia gotten into a tesla rival in the already got into bed with tesla to an extent? >> they are trying to diversify their portfolio away from oil, which is not the way they had been managing their wealth for the past several decades, but realizing a lot of the political tide turned against them, some of the climate change concerns, so to hedge themselves and try to provide for the future, they are making sure they get invested in some renewable energy, some clean energy options and maybe they don't want all of their eggs in one basket. with tesla, we've reported they are a little annoyed that elon musk really hung his funding

secured tweet on informal conversations among them. maybe they are wanting to hedge their hedge a little. >> hurricane florence tore the carolinas on friday and state a -- and stayed a while, don't about 30 inches of rain killed , at least 17 people in north and south carolina and did more than $18 billion in damage. it is not done yet as some rivers won't crest until wednesday. >> we knew this would transition into an inland flooding event and that is what has happened. these are historic inland floods. even when the rain stops, the flooding will continue because the rain has to go somewhere and in those rivers that are already at maximum capacity, are going to continue to overflow and grow -- and going into populated areas. this is an evolving process. >> cleanup starts in hong kong and southern china after they were hit by the world's most powerful storm this year. it left at least four dead,

damaged buildings and forced suspensions in the casino over the weekend. any read on the damages inflicted and how long it will take to repair? >> we can put some numbers on it. the casino closed on saturday, fairly unprecedented for casinos there. they were closed for 33 hours, estimated loss of revenue $86 -- $186 million and one analyst said it may shave two percentage points off the revenue growth rate for the third quarter. kong is macau and hong , slowly coming back to normal. the casino is getting back to normal and the airport, clearing a backlog there. there is not a dollar total on the damage, but it is significant. >> norway's central bank has raised interest rates for the first time in seven years by .25. our people ready for it? >> the country is ready for it.

we have solid growth in the economy. more people entered the labor market. we have even lower unemployment looking forward, and wage growth is on its way up. also, in light of the international picture, which is also positive in the sense that there is growth and normalization of interest rate in policy, it is time to gradually raise our policy rate, as well. >> the japanese prime minister has won his third straight term as the head of the ruling liberal democratic party. the win with almost 70% of the vote takes him a step closer to becoming the country's longest-serving premier. was this the majority expected? we knew basically he was going to win. it is just a question of the margin. >> it was better than expected

and moody's is out with a note saying this pretty much offers stability for policy of shinzo abe. it also wipes away any uncertainty about next year's planned value added tax increase, which shinzo abe has pledged to put toward more social welfare projects and he will also push to change the constitution. >> another day, another trade deadline missed. u.s.-canadian talks for post eight nafta deal has failed to reach an outcome. >> in order for the deal to be signed by the new mexican president in office, they have to get everything published by the end of this month. that means any sort of deal text would have to be agreed to by the three principal parties here fairly soon. the u.s. continues to signal it wants to keep and preserve the

ability to use these national security tariffs if they need to on auto imports. it remains one of the sticking points between the two sides as they continue negotiations. ♪

♪ emma: you are watching "bloomberg best." i am emma chandra. ubs has selected frankfurt as its post-brexit hub. the bank will have offices in milan.at paris, and sergio ermotti spoke withsergioh haslinda amin as the deadline for a brexit deal approaches. >> whatever solution is coming,

it may make it a little bit softer is no longer relevant for us. a few weeks ago, we had to make a decision to execute for a worst-case scenario. the financial system is already operating under the assumption there is no agreement so whatever is going to happen from now onwards will not make the exercise less expensive, will not make the feeling about the disconnect and resolving those issues, we go back to what we started at the beginning. a complication that undermines the willingness to make investments. if you don't know what is going to happen, how can you start to invest? i would say in the u.k. and in europe, this has been something that has prevented people from taking actions and investing in

the future. >> is it confirmed that frankfurt will be the choice for you? sergio: yes, confirmed. we have an existing operation in frankfurt and have a multilocation strategy where frankfurt will be the base. we are branching out and some people are going to be located in madrid and in paris and milan, also a good chunk will go to frankfurt. haslinda: there is expectation out there that a hard brexit could lead to the next banking crisis. what is your take on that? sergio: i think the system is well-prepared. first of all, i do not really believe the next crisis will be a banking crisis. the banking system is very resilient and you may have some banks here and there like the past, the insurance sector was

also part of the problem. i understand that the financial system is more resilient and ready to absorb any shock. i don't believe the brexit can be a trigger for a financial crisis or banking crisis, but it could undermine investments and trigger a slowdown in the economy. that is clear. yes. emma: coming up on "bloomberg best," we cover the week's top company news. the ceo of danske bank stepped down amid scandal and a japanese billionaire may be the first private citizen to travel to the moon. first, more conversations. burgess -- british trade secretary liam fox thinks the u.k. economy will thrive after brexit. he says the pessimists have all been wrong so far. >> the armageddon predictions that came with the referendum

result have not materialized. in fact, the opposite has happened. emma: this is bloomberg. ♪

♪ emma: welcome back to "bloomberg best." i am emma chandra. the tariffs tit-for-tat with the u.s. and china. we discuss with guests throughout the week and the there is a sampling of those interviews starting with the jpmorgan asia pacific chairman. there is a lot of unknowns in this environment, how are you placed how are you making business decisions amongst all of this escalation of the trade dispute? >> good morning.

the last two days, i was beginning to talk to a lot of people. i am less concerned about the direct impact of the recent announcement, the announcement a few hours ago. it is more that impact on sentiment, investors confidence, is so the second derivative what we track a bit more closely. right now in this event we have over 100 cfo treasurers trying to gauge what is happening, it is important. path that we have to do going through discussion. i do not think it will be resolved in the short term. there is no so verbal it, we just make sure we have a roadmap with specific milestones to be achieved in terms of what they're trying to achieve, how they are trying to do it, and

what happens if those milestones are not hit, what are the consequences. >> what does this do to risk appetite and financial stability in the world? >> if you look at the global economic outlook, overall, it is a positive outlook. also in europe, we expect economic growth in 2% or 2.1%. we have already indicated that this kind of trade conflict are actually raising downside risks to the economy. we expect that is going to have negative effects. >> how do you see it expecting eu-china relations? -- were inbeijing, beijing to come are you encouraged about their pledges to the eu for market access? >> indeed. chinese authorities have

and we are encouraged with the political signals and the meetings to discuss the , but it iss important to see the implementation. >> there is uncertainty being into theected environment and with respect to the u.s., can i pass those c consumer?gh to the will see anot, you squeeze and corporate profitability. >> how worried are they about trade war? >> everyone is worried about the trade war and everyone should be about trade tensions. we have not yet seen the mathematical affect of the impact of all of this noise on our portfolio companies.

i am worried about the second and third order effect of what this does to confidence, investment spending, supply chain plans in terms of where andput your factories, there is a level of uncertainty that is injected. faire strong believers in trade and hopefully the authorities can figure something out. >> trade in europe is also a concern as negotiators struggle to put together a post-brexit framework. confidencepressed that a deal will get done and he explained his optimism. we have seen the movements in recent weeks towards an agreement under a number of reasons driving that, political reasons. with the stability italian government, and potential instability with the state elections in her area --

in bravariam crossfire of the there is adispute -- strong desire so that we can have more time to be with the others. the mood music has certainly improved. warningse have had from major corporations about what would happen in the event of no deal. do you think those are overdone? look back to the referendum and we were told that if we voted to leave the european union, just the action of voting to leave would cause a shock that are investors would desert us and our economy would go into recession. we continue to grow and we added 600,000 jobs. i understand the nervousness, i

just think we need to be rational and balanced about the armageddon predictions that came -- they have not materialized. sittingis week, down with the president of zimbabwe. he hopes to restore investors ousternce following the of the longtime leader. became such a perception of the country, we want to move fer theom that and of international community. china is a big investor in you at the moment. are you concerned about the relationship between the u.s. and china and will china remain a key investor, do you hope? china remains very friendly

to zimbabwe and we will continue that friendship and have no problem. but i am embracing the entire community to say that zimbabwe is open to business not only to china, but the entire international community. investors coming in from across the world. in the past, the eu had sanctions against us. so the entire international community is closed out because of the eu. out, butas closed today is the time

with a woman prime minister in britain, things change. she has sent another minister -- coming back, the british prime minister here. we feel that their world is opening up. several high-level officials from the u.s. administration who i've met and i also believe that to be green signals coming from washington indicative of engagement between zimbabwe and the administration. ♪

♪

emma: you are watching "bloomberg best." i am emma chandra. the top business stories with a focus on company news starting with a scandal at the danish bank which claimed the ceo as a casualty. -- dansk of the 200 billion euros floated through the central of a money-laundering scandal. also considering stepping down. >> the big question is how much of the dirty money was flown through estonia and baltic regions? they are saying the flow is $200 billion, but how much of that was illicit funds. some are saying the fact that the bank has not given them of figure means that they do not know what they are looking at. the ceo is on his ways out, so

analysts are saying that today, they have left investors poor but not much wiser. -- theirew investigation has been completed, so we are not planning to put out any further reports, but obviously, we will report any findings for review customers --ink the remaining customers, and that will take time. considering taking tesla private afford a $20. $420. now the company is that the focus of a federal criminal probe. tweet andsent that tesla is facing inquiries from the doj. >> the justice department is

asking questions of tesla regarding the tweets and what were behind it. it is common for doj to run a parallel investigation to the sec. doj would be looking at whether any criminal fraud laws were broken which would require an intent to deceive investors. if anything was found, you get into the next stage of what evidence is there and two new what and potential fines -- and and- and who knew what potential fines. >> the first private citizen to go around the moon. the 42-year-old is ahead of japan's largest e-commerce company. he will make a journey that only 24 astronauts had been on. >> i'll be flown to the moon. [applause]

our bfr system is intended to be able to care anyone into orbit, so he is helping pay for the average citizen to put travel to the other planets. >> you have got this really feel good atmosphere going on, this young, dynamic japanese billionaire and he wants to bring artists along to peoplehe experience the people who cannot experience it. >> the german government is getting behind idea that we could push deutsche bank and to a merger. takes german government an economic review and they say that german companies need a strong domestic banking market. that is why they want strong banks and that is what they

would like to see. they are looking at the european level, and they would say, the european merger is a long way off and it only makes sense if we had a banking and fiscal capital market union. at the moment, they are favoring a deutsche bank merger. ride has been a dizzying for investors. doubled only to see all of that game go up in smoke less than an hour later. even though was a volatile day, they managed to gain at the end of the day. >> yes. 40%. to was the high hitting exactly 300 bucks. $300 a share and than 45 minutes later, and lost all of that and went negative. the in the last 45 minutes,

u.s. market session rising again, 40% to close at $217.75. ♪ >> it is up against some of the almost $3and it lost billion last year, but it says its core business will soon be profitable. core business is growing superfast and also very close. on the third sentiment, we have believed that we are going to be the largest e-commerce with local services. we are going to become a more

mature business. the battle for control of sky could be settled by a one-day action. auctionon takes -- the takes place on saturday. >> the lowest offer have to go first, that would be fox at the moment. they are at 14 pounds per share at the moment and then comcast has an opportunity to respond. and if the auction is still a finalout, there is round of bidding were each party could send their best and final offer and then it will be over. auction,happens in the he would like comcast to bid high, he can sell the 39% stake to comcast and he is a winner. if disney comes with a high bid, then he can win in a good place this weekend. justeepless in seattle,

amazon --ing the cap, it is all about alexei. she is learning new things. >> amazon does not have a smart phone. they are really going after the where people live and even cars to try and be that platform that you use in your home. this is a market that is estimated about $100 billion investment in smart to -- smart home technology. amazon wants to be at the center of that. $40 billion is at the center of the u.s. amazon is flooding the market with these devices to see what works and get people familiar. >> here is one more companies story featuring a start up. to work on a family's

and he made a critical decision. it is one of the top egg brands in the u.s. he spoke to bloomberg about the journey. i was in college trying to figure out what my next step would be. my parents had actively discouraged to meet from coming back to the family business. a small, egg farm. time, we had a few hundred thousand dollars in annual sales. they were nearly bankrupt, nearly going out of business. we started to make the conversion to organic as i was graduating. i describe it as they hail mary throw for transitioning the business. we used one of the barns that my grandfather had built in the

1950's. we repurposed that barn for organic production. outdoor space, scratch areas, roosting -- all the things that go with an organic egg production facility. we were taking a step back, revenues, to take a step forward. much tomuch to my surprise, the business has grown far more than i ever could have imagined. two dozen 3-2007, -- 2030 -- 2007, it did not feel right to have that many barns concentrated in one place. the next move was to expand our farmers whowe found were just interested in being farmers and not marketers or processors or distributors of natu, so it was a

ral fit. we had mitchell a beneficial relationships with farms and we did not have to build up our farms. we have added anywhere from five families a year or two almost 15 family farms a year. we are up to 125 family farms. we are in most major retailers all the way to the west coast. the future for us will be a national expansion into all of the retailers that makes sense for our product. we see the category and segment growing double digits year after year. the growth areas are organic eggs and free range. it could take up to one third of the entire category in dollars.

we should grow close to $200 million this year is what we are projected free at i see no end inside for the potential and i'm actually optimistic. ♪

♪ look at the commodity complex, this is a terrific function that you can use in the bloomberg. what we are looking at here, three different areas of the commodity complex, and we see pretty much every single commodity here green exception of natural gas that had been up big yesterday. about 30,000re bloomberg andhe

we enjoy showing you are favorites on bloomberg television. here is another function you will find useful, qui bloombergt will lead you to our quick takes . here is a quick take from this week. >> decades in the making. computing is a technology that could make today's fastest supercomputer look like an abacus. teams around the world are racing to build the machine. it is still too soon to tell, this is your bloomberg quick take on quantum computing. the computer you are using now processes information in bits back in our present 1 or 0. bits.m computers use two this is called a superposition. position a change to one that is a change to another. it lets quantum computers represent multiple

answers at once. >> if we actually figure out how to do these types of calculations, we can solve complex and unfathomably long calculations with a quantum computer which would take a traditional computer thousands of years potentially. >> there is a lot of hype around quantum computers and researchers continue to make advances. they promised machines that could break the most andnetrable messages diagnose and treat disease, but there is still a way to go. >> it is difficult to make these physical computers, the hardware for these kinds of things. a lot of these are in material science figuring out what is the best hardware to use. we talk about quantum computer, you are not just talking about traditional silicon chips. loopsufacturers use tiny

of semiconductors, or even strange approaches like twisting subatomic particles into a braid. can only exist in temperatures colder than deep space. company became the first of sell quantum computers in 2011 but their usefulness is limited to certain kinds of math problems. microsoft is investing heavily while china is throwing hundreds of millions of dollars into the technology. knows the promise of the technology can help it and get excited about it and even if it is many years away and even if it does not work out the way that it could, this is something that people think is worth spending a lot of money on. the: that was just one of many quick takes you can find on the bloomberg. you can also find them on bloomberg.com along with all the latest business news and analysis 24 hours a day. they'll be all for "bloomberg

best." i am emma chandra. this is bloomberg. ♪

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♪ carol: welcome to bloomberg businessweek. joining you from bloomberg headquarters and new york. -- in new york. carol: this week's issue is the pay gap, and wait until you are about the gender gap that comes to stock options. jason: president macron once likened himself to the god jupiter, but lately, his powers have started to falter. carol: first, we start with another jampacked week in