taylor: coming up on "bloomberg best," the stories that shaped the week in business around the world. politics moves markets. brazil elects a new president, while germany's leader announces plans to step down. >> we may be looking at months of uncertainty still here to come. taylor: central-bank decisions come down from england and japan. the latest u.k. budget proclaims an end to austerity. ibm makes a major investment in the cloud. >> this is, to me, all about resetting the entire cloud landscape. taylor: tech giants are front and center in a packed lineup of earnings reports. >> this next era of basic investment is going to take people away from those newsfeed

ads. >> i think what you are seeing is alibaba is not necessarily entirely hitched to the economy and the consumption trends. taylor: at the end of an anxious month for investors, conversations with high profile guests provide insight on what may come next. >> if you own stocks, have good protection, have some kind of way to limit your downside. >> lots of talks about trade wars, but if you look on the ground, the chinese machine is still working very well. >> there's going to be issues. i love issues. more issues. just give me issues. taylor: it's all straight ahead on "bloomberg best." hello and welcome. i'm taylor riggs. 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 to day look at the top headlines. monday began with an unexpected shock when one of europe's longest standing political leaders gave notice she will be leaving the scene. jonathan: the end of an era for europe. angela merkel stepping down as the head of the christian democratic party in december after nearly two decades at the helm. merkel also announcing this morning that she will not seek other political office after her term as german chancellor ends in 2021. if she is not the right person to run the party, why is she the right person to run the country? >> well, that's a great question to put to her. over the last 12 or 13 years, she has consistently said that the party leadership is necessarily bound with being chancellor. and now she is stepping down, or at least not running again for reelection as the party leader. she said that she's going to stay in office as chancellor, and she wants to serve her whole term through 2021, but you are already starting to see competitors pop up. >> depending on who gets that leadership, they could

potentially challenge merkel for the chancellorship. unless you get someone in as party leader who is strongly supported and is able to get the social democrats behind them, we may be looking at months of uncertainty still here to come in germany with this governing coalition. >> there are a host of political developments hitting specific markets around the world today. in china, while leaders are bracing for an escalation in trade tensions with the u.s., sources say that the white house is planning another wave of tariffs if talks between trump and xi fail. we are seeing a selloff continuing to ramp up, and it's been big tech, falling off the week with a downturn. amazon, netflix tumbling today, extending the worst month for tech -- get this -- since october 2008. a decade. >> we've got a lot of trepidation going into the midterm elections. add to that that we have a lot of other unresolved issues, from brexit to the italian fiscal situation. we have added some risks in

there in terms of angela merkel's resignation. there is a lot going on, and, of course, a pervasive weight on markets is concerns about trade as well as fed tightening and neither of those have gone away. >> facebook shares swung from losses to gains in late trading after third-quarter earnings. revenue and user growth fell narrowly short of estimates, although profit beat. so investors seemed to like what they saw. what stood out to you? >> zuckerberg knows that this next period for facebook will be a big investment period, that they are going to have to figure out how to grow in areas beyond facebook itself, but that he understands that although revenue is going to slow down in the short term, there are bigger opportunities ahead. what he sort of said on the earnings call was that the way people are sharing on facebook, it's going to shift and be more in the ephemeral kind of sharing, like on instagram

stories. he is showing that, basically, this next era of facebook investment is going to take people away from those newsfeed ads, which have been such a big growth driver in previous years. >> the bank of japan left its monetary stimulus unchanged as it updated price forecasts that confirm it won't be meeting its inflation target for years to come. policymakers seem to be a little bit concerned about rising risks. lots of noises about financial stability there. >> yeah, and of course, financial stability is a very important question coming into this, and it has a lot to do with the expectation the boj has to maintain extraordinary stimulus for so long. they are creating instability risk because it is very tough for banks to make money in that environment. no change in that key rate at the short end, being just ever so slightly negative.

no change in the 10-year jgbl being anchored, still firmly at zero, yield curve control. but it's the change in the inflation forecast, because now the boj doesn't see inflation having a chance for 2%, until at least 2021. their forecast for 2020 was reduced to 1.5%. >> and there we have the closing bell. you can see a recovery in stocks, the building of a second day of gains as well. the nasdaq up by better than 2%, the dow adding 241 points, the s&p higher as well by 1%. >> interesting that the nasdaq closes up more than two percentage points, the longest winning streak, two days, back to back gains, the longest we have seen since september 28. facebook needing the tech rebound today after one of the worst months for the sector. why today, a second day of green? >> these were stocks that were just so beaten up in the selloff, so now we are seeing some nice gains. and if you look at the nyse fang index, which holds the faang names, plus a couple others, it's 10 members in the index. every single one of them is higher today. if you look at the gains from

yesterday and today, it is the best two day streak since 2016. but if you look at the month, it is also still the worst month since 2016. so two days, compared to one month. vonnie: the bank of england has hinted there may be a need for faster rate hikes in the coming couple of years. it held rates at .75%. brexit dominated questioning at the media conference after the decision, with governor mark carney signaling that business remains more wary than consumers about the outcome of the u.k.'s exit from the european union. >> he was definitely more hawkish than he needed to be. he actually had the help today -- assuming that he wanted to be more dovish -- he had the help that we had a disappointing ism printout of the u.k., the lowest since the month after the referendum. i think he is right, with the kind of unemployment data that britain currently enjoys and with the history of being more prone to inflation than the u.s. particularly, thanks to sterling. if some kind of acceptable job

can be done on brexit to avoid a total cliffhanger in march, he probably is going to have to tighten more than people have currently been expecting. >> apple has taken a beating in late trading after posting an underwhelming forecast for the holiday period. shares were also hit by news that the company will stop providing unit sale numbers for iphones, ipads, and macs. in terms of that iphone unit number, it barely budged from fiscal fourth last year, even though last year we didn't get new iphones, and this year in the same period, we did. >> that's exactly why it's a very disappointing number to investors and analysts. if you step back and think about it, last year at this time, the iphone x had not even come out yet, right? so the fact that the iphone xs, xs max already went on sale for about a week and a half, almost two weeks, and still the numbers are flat, sort of concerning. but if you look at their revenue numbers, up 29%. it's interesting -- you look at their data chart, 0% unit growth, 29% revenue growth.

you can see exactly why they will stop reporting unit sales. jonathan: the economy adding a stronger than estimated 250,000 jobs in october. the unemployment rate holding steady at 3.7%. solid jobs report. the highlights for you? >> highlights are first a solid jobs report that points not just to higher actual growth, but higher potential growth. you see this in the labor participation rate going up. second, it will make the fed policy discussions even more interesting because that will be the whole question of how much slack is there still in the labor market. and finally, it will make markets more volatile as central banks continue to remove the noise cancellation headphones they have given us for so long. great for the economy, it complicates fed policy discussions, and will mean that

markets will remain volatile, up and down. taylor: still ahead, as we review the week on "bloomberg best," avenue capitals' mark lasry explains where he thinks investors can find opportunity if the economy loses steam. plus, nassim taleb sees another financial crisis coming, and he tells us where it could come from next. and up next, we dive deeper into the week's flood of earnings reports. general motors was one of the companies with a lot to like in the quarterly numbers. >> it was was an absolutely outstanding quarter. we had strength across all of our core operating segments. taylor: this is bloomberg. ♪

taylor: this is "bloomberg best." i'm taylor riggs. let's continue with our global tour of the week's top business news with a look at some more earnings reports, starting with results from credit suisse. francine: credit suisse's turnaround is running out of steam, just as the bank enters the final stretch of its restructuring overhaul. now, revenue and net income missed estimates in the third quarter, and, of course, a lot of the banks are now asking questions about global markets, which posted an unexpected loss. >> what's happening in global markets is they have been very good at cutting the cost, cutting the risk without destroying the franchise. we are still number one in asset financing in the u.s., number 2 in average finance, still number 4, 5 in prime come in -- in prime, in cash equities. so we remain a very, very good place to invest. francine: so you will hit your targets?

>> one year late. we said that in q2, a 10% return on capital in global markets. at that point it was to o ambitious given the market conditions. >> hsbc ceo, john flint, has finally delivered the growth investors were going for. adjusted pretax profit was up 16% with revenue up 9%. the jaws figure is moving in the right direction for the bank, indicating the lender has managed to increase revenue faster than costs in the quarter. hsbc also said it was on track to deliver positive news for the year. >> what's confusing the market to an extent is all banks have a huge investment program at the moment, multibillion-dollar investment programs. part of it is investment for growth. but we are still struggling to understand the roi on these huge investments. so if you are investing so much that actually all of your revenue growth is offset by cost growth and the market does not understand what that cost growth is for, it is technically value destructive. if the market buys into the fact

that investment is accretive, that is a positive for the shares. >> let us give you the numbers from b.n.p. paribas. the buffers of capital up .25%, up 25 basis points. but net income, $2.12 billion, and global markets had its second-worst quarterly revenue since 2016. sixth straight quarterly contraction in bond trading. >> of course, there are some lackluster environments in europe on some of the activities and we compensate by deploying our resources efficiently. that is why if you look at the cost, you see the costs are picking up in the specialized business of retail to a company that growth that i talked about, or that they are reducing in retail to face the pressure on the top line. >> national australia bank's earnings fell the most in a decade on restructuring costs and the bill to clean up after misconduct exposed by the bank inquiry. >> i think our underlying

results, stripping off the one-off lumpy items, profit down 2%, we have grown revenue nearly 2%. investment means that costs have gone up, but that is to invest in technology to make the bank simpler. i think it is a incredible underlying results, given the situation. vonnie: ge missed estimates, and is losing its unit. it also now faces an expanded sec investigation. >> larry has earned a lot of respect from wall street, from what he did in danahur. but honestly, he was in building mode there. now he is inheriting this sort of labyrinthine conglomerate that he has to unravel. he has balance sheet woes that were never a problem at danahur. i think he is up for the task but it will certainly be difficult. i think investors were certainly hoping to hear more from what he did than what they actually got.

i think maybe they were too optimistic about the ceo hitting the ground running. david: general motors came out with earnings earlier today, and they are being rewarded by the marketplace. stock is up 7% because they reported really a beat on expectations, a big beat on earnings-per-share, revenues are up 6%, attractive margins. what are the highlights for you as cfo of gm? >> it was an absolutely outstanding quarter. we had strengths across all of our core operating segments. north america was extremely strong, 10.2% margins, driven primarily by the strength of our pickups which we just launched. we have had a strong pricing environment as well, and when you look at china, we had a strong third-quarter equity income of $500 million. gm financial, it continues to perform exceptionally well with a record earnings before tax of

$500 million. so what you are really seeing, david, is our execution in what has been a challenging environment, and those are the numbers we have put up on the boards today. >> vw third-quarter operating profit beat estimates, sales also be estimates as robust results from porsche helped stem the fallout from trade tensions. a cooling chinese market and new emissions tests in europe are also headwinds. you did not cut your outlook, and your competitors have. what separates you from bmw and daimler? >> we knew from the beginning of the year that the second half would be more challenging. i think we laid a strong foundation and traded fairly well, exactly within the range we expected in q3. i think the situation might be different, particularly if you look at bmw and mercedes, who have an issue with import duties and the tax on exports from the

u.s. we don't have that, but we should not comment on other people's business. we have to fight for every customer, and that is exactly what we do until the end of the year. >> chinese search giant baidu forecasting revenue that fell short of analyst estimates on fears of slowing economies and trade tensions hitting advertising sales. take us deeper into the numbers. >> baidu actually reported better-than-expected revenue, but the outlook for the fourth quarter disappointed. this is on concern that ad sales are going to start to slow amid the weaker economy and trade tensions as well. there is a sense that customers for baidu are starting to become more cautious on those sales, particularly around the search engine and the newsfeed aggregation product. shery: let's turn to samsung electronics now. they just posted a quarterly profit that topped analyst estimates, but warned of weakness in the chip industry. how good are the numbers?

>> definitely a record high, both in terms of operating profit and, i believe, also from the semiconductor profit. having said that, as you pointed out, there is some concern, in fact, increasing concern that dram prices will start softening in the next two quarters, and it will be challenging for samsung to sustain such a high growth rate in terms of profit. alix: bp having its best day since 2016, earnings crushing, reporting a surge in profit that smashed estimates and giving the company the confidence to fund its $10.5 billion u.s. shale oil deal with cash instead of having to raise equity. >> things look well underpinned. we've had a strong quarter in on back of the six previous quarters in terms of the plans we laid out. the financials are strong enough to say that we have optionality

when we created the deal to use cash rather than shares. this is a much cleaner transaction now. it will let our gearing drifts up towards the top end of the band. it may go through that, and then will use it investment proceed to let the gear and come back down again next year. jonathan: alibaba reporting second-quarter revenue that fell short of estimates, and cutting its sales outlook for 2019. the chinese e-commerce giant blaming macroeconomic conditions, saying the global economy is in "a state of uncertainty." >> i think what you are seeing is alibaba is not entirely hitched to the economy and the consumption trends because what we are doing is digitizing not only our own platform, but also the traditional retailer's platform, enabling our retailers and partners to capture more customers and operate their business more efficiently. that is what we call our new retail strategy. so that is an area where we are very excited about. ♪

taylor: welcome back to "bloomberg best." i'm taylor riggs. this week, avenue capital cofounder and ceo mark lasry sat down with bloomberg's erik schatzker for an exclusive interview. they discussed volatility in the markets on the eve of the u.s. midterm elections, and lasry said a slowdown in growth could create opportunities for bond investors.

mark: in any slowdown, you're going to have bonds drop pretty quickly, and for us, what we will see, is we think we will be able to buy investment grade bonds trading today at par. once there is a problem with bonds moving up, it will be to raise those at about $.60 on the dollar. >> yes, $.60 to $.70 on the dollar. mark: that means that there will be issues. more issues, give me issues. >> when does that happen? by how much do rates have to rise, and where on the curb are we talking about -- are we talking about what the fed is doing, or a repricing of the middle or long end of the curve? mark: i think as rates go up, i think it will go up about 100 basis points. they will. >> market rates, or? mark: just fed funds, and they have to raise rates by 100 basis points. as they do that, the cost for companies, because everything is

a floating rate, it starts moving up. what everybody will focus on -- right now what people are focused on is how much the economy is growing by. >> 3.5%. mark: right. >> if rates are 100 basis points higher and the economy is only growing, let's say, at 2%. mark: that means the economy is contracting by a third. so all everybody will talk about is a slowdown, as opposed to the fact that you are still growing at 2%. so once that changes, the psychological change happens, what you will see is the markets will start to focus on hey, when will we be hitting that? >> you don't think the psychological change is happening now? we can look at what the fed is going to do with interest rates and if you have a confidence in that, predict that 100 basis points, it may only be 12 months, may not even be 12 months away.

mark: i think it is starting. i think it has started, but you need more issues, you need to have more problems. and i think we will start seeing that. >> is a 100 basis point increase overnight lending target enough to trigger the distress cycle? mark: i do not think it is enough. but i don't know if it is the beginning of the cycle. to use a baseball analogy, if a great now, we are in the second inning on the distress side. >> very early. mark: yeah, very early. you want to get to the middle innings but we will get there. the question is how long does it take? taylor: coming up on "bloomberg best," more of the week's business news from around the world, including downbeat economic data from china and the eurozone. and as signs point to a slowdown, could the global economy be heading towards another crisis? our guest describes what the next crash could look like.

>> the first casualty would probably be real estate. taylor: this is bloomberg. ♪

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150 dollars off and free shipping too. sale prices are available right now. go to buyleesa.com today. you need taylor: this is "bloomberg best." i am taylor riggs. the author of "black swan" is renowned for assessing financial risk and finding vulnerabilities in the markets. and as he did prior to 2008, he sees problems of mounting today. he spoke exclusively with erik schatzker about why he is sounding the alarm on government debt and the effect it could have on the global financial system. >> 2008, we transferred from individuals to the states. all right? that is 2008. so you had a way to do things, and we could lower rates as monetary policy to zero, which because the cure of the structural problem was monetary

policy and should be there is emergency measures. now, 10 years later, we are starting to raise rates because you have to raise rates. you cannot keep them at low levels. it is unhealthy. somebody is going to pay the price. who is going to pay the price of higher rates? a lot of people benefited from that free money. many corporations. it will first be real estate. real estate is very sensitive. the higher-end of real estate has been going down worldwide. everybody knows, -- people notice when they talk about it, it is not showing in the numbers. because quantitative easing increases among other bad things inequality, and -- >> real estate is most vulnerable. >> higher-end, and then the rest of real estate. >> you predict a collapse in the real estate market?

>> possibly, and then -- >> what comes after that? >> the stock market, think about it. >> is that what we are seeing today? >> no. you cannot maintain the stock market in the presence of high interest rates. plus, interest rates typically, from my experience as a volatility trader for 35 years, the problem is high interest rates. you always observe on high interest rates volatility masks low interest rates. so we will see some volatility. >> if interest rates go higher, bond prices go lower. there is no safety in the bond market. is there anywhere you can see that is actually safe? >> i own some gold but i am confused about it. i own it just in case. just to be safe.

i own some land that has not depreciated. but i do not see anything except watching your cash inflation hedged, and also if you own stocks, some kind of way to limit your downside because tail risks are as big, if not bigger, than they were in 2007, and before that. taylor: on a more encouraging note, mining executives at the international metals and resources conference in melbourne, australia see positive trends for commodities. this is despite the ominous overhang of trade tensions between the u.s. and china. industry leaders spoke with bloomberg, starting with the ceo of rio tinto. >> the mood is still pretty

good, you know? a lot of talks about trade wars, but if you look on the ground, in terms of aluminum and iron ore, in copper, they are full. the chinese machine is working well. you have to be clear -- and it was not really surprising that the chinese government are putting more money into the system. what did surprise us was putting in so little. we did not expect it, but it does not matter. if you look at the statistics, china will produce their own iron ore and 175 millions tons of steel which is the highest ever. so the demand is strong. are we concerned at this point? the answer is no. looking forward, which is more important, we have no doubt that china will lead the way. that means additional demands in terms of aluminum, copper, and some of the minerals in relation.

so we see significant upside. even if it is not clear-cut what will happen in particular terms, it will generalize more demands for our product. we are a long-term business. we take the long-term view. are we overly concerned about the medium to long-term? the answer is no. >> it feels like a shift from optimistic into investment, despite everything going on with the trade war. >> that's right. what we are seeing is that china, there is very strong demand. steel production is still at record highs. we are seeing strong demand for iron ore on the back of strong steel production in china. so we are investing in our business. we announced earlier this year that $1.275 billion project, which is another indication of our ongoing investment and confidence in the industry. >> if you look at the physical

demand of copper, especially in emerging markets, if you look at growth of copper demand in china, north of 5%. we believe the market is quite strong and robust despite the uncertainties around the trade war. some of that is related to the fact that most of the copper that is going into emerging markets stays there, is not reexported, it is put into properties and infrastructure and into the expansion of the electrical grid. so we have a favorable outlook on copper and therefore believe what is happening in the short term with price, which came down from june onwards and has been trading sideways is mostly the result of the uncertainty around the trade disputes. fundamentally, the outlook for copper in the medium-term is very favorable. the question that remains, copper will not be impacted directly by an escalation of the trade war, but to lower economic growth globally, that may have an impact. it is dissipating that uncertainty which i think has the price where it is today.

taylor: with the u.s. elections coming up next tuesday, a ballot initiative in san francisco has been causing a risk in the tech -- a rift in the tech community. proposition c would generate up to $300 million in tax revenue per year, specifically to support homeless services. it would raise funds with a special tax on companies with an annual revenue of $50 million. twitter and square ceo jack dorsey has come out against prop c. marc benioff, who supports the measure, if he thinks that charge has merit. >> i see a crisis of inequality in san francisco. that is what is striking to me. we have 70 billionaires here in our city, that is incredible. we have companies you report on with hundreds of billions of dollars of market cap. salesforce, we are the largest employer in san francisco, not

just the largest tech employer. the largest employer. we have a $100 billion market cap. you just talked about a few companies -- square, worth $30 billion, twitter, worth $20 billion, stripe, $20 billion. the amazing thing is these companies can afford it. for us it is a $10 million tax. these are immaterial amounts to us. $10 million does not mean anything, that is less than the plane jack dorsey will fly around on. it is the money we need to make a difference in san francisco. >> jack dorsey is saying at a certain point for square, it becomes unsustainable, and they will not be able to stay in the city, which in his words would be heartbreaking. >> that is what i see with the homeless, the homeless are not getting the treatment they need. that is they need shelter and mental health treatment. they need treatments for their addiction, and kids who are on the street -- that is the most

touching part. kids have to get into homes. we have the plan and know how to do it. we have been running successful programs in san francisco for the homeless now for years. you know that. i have been involved with them. i have funded tens of millions of dollars, we know how to do it. but we need more funding now. i was on the phone with the mayor. she needs an emergency funding of $6 million from me to get a shelter open in the tenderloin because she is out of money. if you look at other politicos supporting this, nancy pelosi is supporting this, dianne feinstein is supporting this, jackie speier is supporting this. and not just me, chuck robbins, the ceo of cisco systems, we are all supporting it. the region's, nation's two largest tech employers here, we are both supporting prop c, it is right for business because homelessness has been tough on our business.

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taylor: this is "bloomberg best." i am taylor riggs. let's resume our roundup of top news in business and finance. voters in brazil went to the polls to choose a new president, and the results were not close. >> brazil has elected far right candidate jair bolsonaro as its next president. the former army captain had almost 56% of the vote and will take office on january 1. he has spoken about wanting to privatize state assets and in and perform to fix this ailing economy. do we have any details, because the markets on brazilian assets have rallied as though this is a

one-way bet. >> the market rally is in response to his economic advisor, a liberal economist who wants to privatize everything. we do not have a lot of specifics. i believe they want to privatize a little over 100 state run companies in the first year of government, but probably none of the major ones. not ones like petrobras or the banks. we do not know how they will do this and how much money it will raise. >> philip hammond has declared that austerity is coming to an end for taxpayers in the u.k.. in his last budget before brexit, the british chancellor tried to reassure voters and shore up morale by peppering his budget speech with spending pledges and a surprise income tax cut. >> the most important thing to remember is the way this money became available primarily was through a change in the calculation linked to the forecasts. we should think of this as per unit of gdp, more money has been

created because things are calculated a way that has been amended. this money has been created and will largely be going to nhs. all of this is uncertain. if growth were to change, if brexit were to go badly and this budget becomes null and void, we are back to square one. so budget is really an area of great uncertainty, especially when you have brexit risk looming. >> the euro economy grew at its weakest pace in four years. growth in germany and italy almost ground to a halt. what we did have was german inflation data, which came in at a 6.5 year high, which poses something of a problem for the ecb. if you are mario draghi, how do you square that circle? >> it would be relatively easy. the main mandate of the ecb is inflation. they have been looking to

restore inflation in the euro area for years and have been using qe and negative rates to do that. now, inflation seems to be here, so mario draghi will have an easy answer and say we look at inflation, inflation is finally there so there is no reason for us to change course. of course, if the euro area really starts to be cooling, and draghi said last week it was only a temporary slowdown, there was no fundamental change in momentum, it will be a big problem with high inflation and low growth. that could be a big problem for the ecb in 2019, but for now, no reason to change course. >> the official gait of china's manufacturing worsening in october. the effects of the trade war with the u.s. hitting home. frontloading is the excuse. >> softness is clearly emerging across the board. across the board, new exports,

new orders for exports is weak. but the real critical take away from these numbers, there is only expected to be further downward pressure on china in the months ahead, because the trade war is only getting going in earnest. the stimulus measures chinese officials have taken are in the early stages and will take a wild before they impact -- take a while before they impact more growth on the ground. china will have more pain in the near term before it gets better. >> china's leaders are signaling additional stimulus measures are in the pipeline as disappointing data shows recent steps to shore up the economy have not worked. >> meeting yesterday evening, putting out this statement which cheered the politburo by xi jinping. it says the economic situation in china is changing, the downward pressures are increasing, and they need to proceed with "timely steps" to

counter this. it seems china's policymakers are up in terms of their levels of concern, and now view a more aggressive approach as potentially being necessary. >> auto stocks are getting a big boost in the session today, surging on a bloomberg scoop that the world's largest auto market, china, is proposing to halve the tax on autos to 5%. how meaningful is this? >> it could help. the trade war has bigger tariffs on cars and parts, and that has raised prices on vehicles in china. but the market itself has been slowing down. in some of the big cities, they have had limits on registrations because of congestion in the cities. so that has slowed sales down. this could really help pick things up. the trade war will create headwinds for anyone selling

cars over there, but when you are talking about a tax going from 10% to 5% will get people out to buy some cars. >> yesterday, ibm announced it would acquire the open source software redhat for $34 billion in cash, marking the second largest technology deal ever, ibm's biggest acquisition by far and a major step forward in ibm's cloud strategy. >> we have been reshaping ibm for this moment. this is, to me, all about resetting the entire cloud landscape, and this is the inflection point to do it. if you look at our clients, chapter one of the cloud is over. they have moved the easy 20%, the cost saving they wanted to get done. that is done. but the 80% ahead is a $1 trillion market, and this is the moment to go after it. to go after it, they need a hybrid cloud, they need what jim and i do together. we are the true open source portable answer for them. >> what we have lacked is scale in the market, a depth of

customer relationships because we are a new player coming up. we have lacked deep industry vertical expertise, and lack the overall level of investment we need to meet our full potential. ibm brings all of that. >> the rupee saw losses as india looks to defuse tensions with the central bank. the annual reserve bank of india has been locked in a standoff in recent days as a bank regulation and bad loans. this comes in days when india's currency is the worst performing. what has led to the latest spat? >> it instituted a leverage state on banks and hit the power sector companies. what that means is that the state-run banks, which have 70% of the banking sector, cannot lend.

remember, india is going into an election next year. the government is trying to say, the banks need to lend more. can we have them come out of these lending restrictions that you have imposed on them and get them lending so we get growth going into an election year? >> the bulls are back with hopes of global stocks gaining after it trade truce between the u.s. and china, after one phone call between the leaders. president trump has asked his cabinet to draft a possible trade deal with china ahead of this month's g20 summit. >> china responded today, and we had some very diplomatic language going across the news services there. i think the next thing to look toward will be a speech from president xi jinping on monday at an export exhibition. it will be crucial to see how president xi responds there, if he makes any comment on the

trade. he is unlikely to mention the u.s. by name, but he will mention if china is willing to play its part or open up its market to technology and the like. but as always, there is a degree of caution in all of this. it is still the early days. >> what we have seen in the earnings season that is about to wrap up, some clear signs of stress related to the tariffs. and to the trade war with china. that is being noticed in the white house. there will be a lot of internal debate, this is not something resolved and set in stone today. ♪

taylor: this is a function in the bloomberg on the month, and we see nine of the 11 s&p 500 sectors lower.

we have four sectors down 10% or more. official corrections just in the month of october. there are about 30,000 functions on the bloomberg and we enjoy showing you our favorites on bloomberg television. maybe they will be your favorites too. this function will lead you to our quick takes, where you can get important context and vast insight into timely topics. here is a quick take from this week. >> in june, 2018, saudi arabia, the only country that did not allow women to drive, lifted the ban. women in the kingdom rejoiced, but many expected it was not meant to bolster women's rights as much as the economy. this could make for a formula that brings improvement for women in the mideast. this is your bloomberg quick

take on women's rights in the mideast. the saudi kingdom's crown prince mohammad bin salman wants to diversify his country's economy, which includes adding women to the workforce. >> if women are going to participate more actively in the economy, they need to be able to drive. before the ban was officially lifted, a lot of women who were very active in campaigning for the right of women to get behind the wheel were detained, and many have gone into exile. >> but just because it is a plan to get more women working does not mean it will happen quickly. societal pressure for women to stay at home remains strong. and a guardian consent requirement makes women dependent on their male relatives. women cannot marry, get a passport, or travel without getting permission from a guardian who could be the father, husband, uncle, or even her son.

12 of the 15 countries in the world with the lowest level of female workforce participation are in the mideast and africa. yet getting more women into high-paying jobs may be the key to cultural change. >> the thinking is the more active women are in the economy, the more they will have a say and entrenched norms, and reshape how women are seen in that part of the world and elsewhere. >> many advancements that women have made came as a result of the arab spring uprising that began in 2010 and 2011. >> women were on the frontlines of the arab spring and fought to have a say in how their society -- which generally tended to favor men -- was shaped. >> progress is most pronounced in tunisia, where most of the uprisings began. the parliament overturns legislation prohibiting muslim women from marrying non-muslim

men. but many pay for speaking up. in 2018, a woman was jailed in egypt for four months after complaining about sexual harassment. >> in the optimism that the uprising brought to egypt, i talked to an academic who cautioned about being too overly optimistic. she said women have been revolutionary in moments in the region. >> that was just one of many quick takes you can find on the bloomberg. that will be all for "bloomberg best" this week.

take you for watching. i'm taylor riggs. -- thank you for watching. i'm taylor riggs this is bloomberg. ♪

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david: so, you met your wife in high school? michael: we met in seventh grade. david: so you did not date around when you were in seventh grade? you just -- [laughter] david: can you explain how you invented high-yield bonds. michael: to de-risk america, to you don't want to be dependent on a handful of banks. david: you came down with prostate cancer. michael: i lost 10 relatives. david: what helped change how we finance things? michael: first you collect the data. david: do you regret anything about your financial career? michael: sure. >> would you fix your tie? david: people wouldn't recognize me if my tie was fixed. but, ok. [laughter]