>> let's get to the first word news. a law-enforcement official tells the associate press the gunman who killed 12 people at a southern california bar posted to social media during the attack. he posted to facebook and instagram about his mental state and whether people would believe he was saying. authorities have not determined a motive. president has signed an order denying asylum to migrants who enter the country illegally through the u.s. mexico border. he wanted to come to the u.s. legally. the president spoke to reporters before leaving for europe. >> we need to the kratz to bring us up to date.

worst laws in the country has anywhere in the world. it is only because we don't have the democrats vote. we need democrats vote so we can change immigration. >> the move was spurred in part by our -- caravans of central american migrants moving forth on foot. the lawsuit argues the new rules are legal and will put families in danger. say a stabbing attack was linked to terrorism. a man stabbed three people before being shot by a police officer. the attacker died inside one of the victims. french officials aren't sounding the alarm over a sharp rise in anti-semitic acts. hasprimitive said there

been a 69% rise in the number of anti-semitic acts reported to police the first nine months of 2018 compared to the same time last year. they are planning to increase punishments for perpetrators. global news 24 hours a day on air and on tictoc on twitter powered by 2700 journalists and analysts in 120 countries. this is bloomberg. scarlet: this is bloomberg markets, the close. caroline: we have 30 minutes from the end of the trading day and the trading week. the nasdaq the key laggard. ,echnology shares underwhelming

forecasts coming from a number of companies. down by one and a half percent. energy index, a downward pressure on oil. we have the longest selloff in oil ever on record. nasang at the pound, the rations are concerned that if we will get a brexit deal or not. scarlet: let's dig into the markets. we come up close heading to the close. it is a winning week but on a day of a lot of red. , disney is the best performer in the dow. that are than expected fourth-quarter revenue growth. on the flipside pg&e, the worst performer, they serve northern california. wildfires are taking place across northern california. volatility trying to claw its way back. scarlet: 90.3.

>> the worst month in seven years. many are bracing for november 15. that is a deadline to put investors on notice to get their money at year-end. , peggy collins. this is if investors are looking at statements, saying i want to get out of this before the end of the year. they have to let the hedge fund managers know they want to withdraw. >> essentially this is the time when investors are able to say i want some of my money back. i need it by the end of the year and they put it in now. some hedge fund managers have been already saying a string of redemptions. it is coming on the heels of october when they didn't really have a good month, when things were more volatile and we were anticipating hedge funds with volatility that a lot of them had been waiting for would benefit from that that we saw a

number of hedge funds caught flat-footed. we are wondering if this will actually be the straw that breaks investors backs. caroline: worst month in seven years. how much money has been pulled? >> i do have a total figure but the industry itself is still at $3 trillion. that number has flatlined. is still large but investors are being more intentional about who they are going with. the hedge fund managers still doing well and the newer managers that are coming up. >> like to? >> element capital has been doing well. he is one of the hedge fund managers. some of the newer hedge funds that started this year that we have been on watch for, exit his

point, samsung, from a reporting they started with some record billion in capital. >> with increased volatility some hedge fund should be able to capitalize on that. hedge funds are meant to hedge. that is the idea. surely this would be an opportune time for many, assuming they are positioned correctly. >> a couple of things are happening. over the last seven years as the market was surging, hedge funds got more long been short. they were in a lot of things in order to get the gains. not a short as some may have thought they were. the other thing, we have seen a lot of quantum hedge funds emerge. they had been able to move fast but the reversal we saw in october may have been too fast for some to reprogram algorithms

or spot a downward trend versus a downward spike. scarlet: the wrong direction. caroline: exactly. rectifythe industry itself? we turning to see a change? if we keep seeing bouts of volatility you don't win out? >> reporting is showing investors are feeling this volatility is going to continue. one of the things they are saying is you may not want to necessarily give up entirely on the idea of having downside protection but the thing that is emerging as well is how much do you want to pay for that downside protection. the fact hedge funds have not been able to knock it out of the park gives investor pressures on how much they're paying for hedge funds. >> we have the co-ceo of goldman sachs on. he said actually, institutional

investors are straight look at hedge funds. >> you have to look for alternative ideas in this market given so many people were position for faang stocks to continue climbing. thank you. our u.s. investing editor. caroline: blizzard plunging the most in a decade and taking other video game makers with them. we have details, head. -- ahead.

scarlet: time for our top calls. first up, we have general electric. a 2009 low. bear market low that is. shares were cut to six dollars. andng liabilities,

third-quarter results. it is a strong company. for ave ubs downgrading $50 price target. it is skewed to the downside. tripadvisor off by 5%. j.p. morgan downgraded to neutral from overweight. the analysts citing weakness and paid advertisers and rising competition. those are your top calls. >> not leveling up. and blizzard plunging the most in a decade coming off a quarter -- fourth-quarter report. they are also falling on the news. let's welcome laura martin. she has a buy rating. great to have you on the show. time now to get in on the stock?

becauseve this stock these are basically franchises. each of these games have twenty-year lifespans or better. call of duty to date has generated twice the revenue of all of the star wars movies added together. these are long businesses. are afraid of fortnight. franchisesy has 12 big or bigger. i would say this looks cheap. appreciating.der talk about call of duty black ops sales. when they first came out there was confusion as to whether it was disappointing or exceeding expectations because the bulk of the sales cannot be until the holiday shopping season. >> that is true.

they got 3 million users. an average start of 14 months. duty, the most successful weekend. but to your point people by that as a christmas present. 2 have to wait until december call whether can be crushed friends and call of duty are failures or not. overeople are elongating which they buy these games. actuallyredemption is speeding up. people are went a play that 100 hours and then play call of duty. they may just push off when they buy call of duty. >> red dead redemption. i like saying that fast. >> hard to say fast. >> what about the longer-term drivers?

undervaluingwe are the addiction to these key ones in the portfolio, where does this company go? they own 100% of their i.t.. , their rapid pub g consumer adoption is teaching companies some things. as soon as they bring their ip to the mobile stage they can get that as long as they want to get that right. some of the innovation in the games comes from kids who drop out of stanford and harvard but activision and ea can follow and they don't have to be fast

followers. is long-term valuation story tech. has grabbedtnight the attention of so many young people and changed the videogame industry overall. about whether it is peaking or reach saturation point? >> there is some stuff we know raised $1.2they billion in the private market. they are making 3.5 billion this year. so, that is a very successful gain. the game is free. all that money is being spent with in game purchases. we also know activision does 4 billion a year in in game sales. these businesses are much more

diversified compared to a single title. >> thank you for joining us. with the u.s. market moments away, the close, we are looking at down arrows for u.s. stocks.

caroline: this is countdown to the close. scarlet: we are heading to the close. joe weisenthal joins us as he does every day at this time. consumers are feeling just fine. joe: the market continues to be volatile. the data is fine. consumer sentiment coming in better than expected, slightly down from a high level. nothing that reeks of

deterioration. we have producer prices today hotter than expected on the headline number. that may give people anxiety if it is seen as diminishing margins or something passed along. caroline: overall we are in the .reen joe: which is kind of amazing. scarlet: things feel like they have calmed down a little bit. looking at a second day of declines. if you look at the sector breakdown, groups doing well are more of the defensive companies. household and personal products. excited -- eling >> and a lot of momentum on tech names.

when you look at how the intraday index is shaking out the nasdaq that laggard here. >> that is what we saw with a disappointing forecast. check is being crushed. scarlet: we are moments away from the close. let's take a deeper dive and start with sarah. what are you watching? >> we're moving. we're moving full steam ahead where do to stocks go from here? i want to bring you statistics. if you look at the past 30 years in the fourth quarter what does performance look like come s&p 500 has only fallen five times. 80% of the time the s&p 500 has been in the green in the fourth quarter average returns are 5%. at the same time during an election year this can sometimes

.ouble s&p 500 can gain 10%. if you consider the october 29 low we have gained 5%. we are almost there. >> thank you. i'm watching two of the largest etf's tracking energy stocks. took a big hit today dropping 1% in intraday trading. they did manage to gain back a bit as we watched crude oil hit $60 a barrel pushing further into bear market territory. that is a big difference from the prices we were seeing in october just a month ago where we were seeing crude oil hovering around $75 a barrel. since then it has dropped. both of these hold some of the losers in the energy

sector today. exxon mobil and marathon. earlier, after trading started marathon fell 3%. it did game back a bit but both falling down. we can't talk about the stocks without mentioning we will be watching the opec meeting taking place in abu dhabi. the organization is under pressure to cut supply once again. we'll be watching to see what happens. abigail: solid declines for the major averages. the apple complex. take a look at this. 7.8%, theker down worst day since 2016. a disappointing guide for the fiscal first quarter. smartphone weakness weighing on the apple suppliers and apple down 1.9%. the biggest drag on the nasdaq 100. apple on pace for its worst monthly performance when they put up a disappointing quarter that had to do with the first decline in revenue in a long

time. fiscalde, apple's fourth-quarter was disappointing. some bearishness here for the apple complex. it points to the possibility we can see more declines for apple. april 2016. this is the latest boom cycle. the buyers are in control in relation to the moving average. we were near the top of the channel. it has ae crosses that history of going right below. concerning the area of congestion, being generous quite frankly. thejust the waiting on averages but this pattern is going straight down. really tells you the sellers are taking the opportunity to pounce. staying with the text

theme, s&p 500 information tech center. let's talk about the tech route in general. michael regan, you have a great about volatility here to stay. >> i make the point i don't think it is any of the big bang complexes. it is not like these companies are in trouble. we have seen the straw down in faang stocks on the market was so quiet. drawdowns.se they seem to always recover quickly. this one does not like that. just the depth of the drawdown is bigger. looking for the growth rates that have come down a lot. facebook, google, alphabet. they are just not the growth rates that may be the market leaders.

looking for new leadership. underperforming even with the market getting more stable after october. tack has not been able to catch a bid. it is a make some something going on. >> when you examine the company, they are still doing great. that is endemic of what this whole situation is. they have gotten so big and saturated. there was so much crowding from so many different styles. things are the top of the hedge fund. whenever there is a crowded hiccupbviously one minor and he can have a freak out.

it is not clear the crowding is all that is left. it is not the best set up. go beforeo minutes to the close let's bring in alex. thisdo you make of commitment? not just because of valuations but i host of structural reasons as well? >> this is about where we are. we have to start paying attention to some of the details. that rotation starts to come into play. , puttingeing investors protection around it. in case you bump into something that gives you pain. that is a what i think we are seeing. that is what we are seeing today. >> the oil dynamic, we

started to see that come off. i have not seen much weakness on the demand. are. is based on where we ,riends like accepted m&a buybacks. we have not seen things just yet but we are deal with a flattening yield curve. that puts it in the late cycle bucket. thinkould be curious to goldman would be the record your friday us. you have uber coming, airbnb. from the.commory crisis was that oversupply of equities is part of what tops the bundle. supply,backs shrinking

[indiscernible] when you see the sudden surge of ipo's, private equity firms on venturessh in they have been sitting on for a few years and trying to time it at the top of the market. i think we have some upside from here but going back to when i talk to asset allocators, it is about positioning where we are in the cycle. they are willing to sacrifice the upside to give them a bit of downside protection. i think that is what we have been seeing in the last couple of weeks. caroline: we are 1.7% on the the placetech is not you want to be but it has been up on the week to the post-midterm elections. when i look at sector

performance, we have been talking about technology being the worst, but you have consumer as well asry communication services and materials. maybe upside, the value, more defensive names like staples, and utilities. joe: and netflix off 4.5%. they cannot catch a break. star deeper into the market action with our reporters. >> today i'm watching the largest etf tracking the mexican stock market, that is the msci mexico etf. has seen massive selling volume and pressure over the past couple of days. you can see it is up a little bit on the close. at one point, it was falling as much as 4% and dragging the etf down to its lowest level in almost a decade. yesterday we saw huge outlooks for the fund as investors yanked the most cash in five years

following a surprising proposal from the president-elect party to limit the fees mexican banks can charge customers. the 90 day volatility for mexico's benchmark equity index has surpassed its level during the u.s. 2016 presidential election signaling's mexico next -- signaling mexico's ex-president has great and more volatility than donald trump. abigail: let's take a look at the s&p 500. this is a five-year chart. we will see some bullish that bearish factors. let's start off with the bullish because we have the s&p 500 closing above its 50 week moving average. that is the equivalent -- 200 a moving average. issuing a sell signal if you will. i would like to point out that going into this year, the white line, the difference between the 12 week and 26 week moving

average, is the highest ever going back to 2000. the difference between the near-term buyers and long-term buyers and the fact that it has fallen off quickly accounts for this year's volatility as the dippers are facing -- phasing out of the way matching the buyers, but we are still issuing sell signals and if we go back to the correction of 2015 and 2016, it suggests there is more bearish action ahead in the s&p 500, scarlet. scarlet: thank you so much for putting that all into context for us. still with us is alex dryden of jpmorgan and mike regan. i want to talk about retailers. joe was talking about the university of michigan sentiment showing things look good and d people feel good. next week of the tail end of earnings season with home depot, norstrom, and others reporting retail sales numbers on thursday. how much weight will be put on these numbers given technology is no longer a driver of growth

to the upside and stock price action to the upside. we have been seeing is that investors reward the companies deceit topline revenue growth. if you beat an earnings per share, you get a little bit of a reward, but the company to manage to grow their topline this light seems to be getting rewarded. that is the theme -- late seems to be getting rewarded. that is the theme. investors are getting that nervousness scraping in. it is not to be unexpected. scarlet: so you can't cut costs for wage growth. joe: rights. how much is this the fed's fault? [laughter] slow the want to economy down and maybe the economy is slowing down a little bit. >> i think with the selloff we saw today, we cannot judge it just in equities. much of this economic cycle has had no alternative but to buy

equities. they 3.2% off of the u.s. tenure. there's alp but think little bit of equity into bond rotation happening. we can thank the fed for that one. caroline: you have got a call that 3.5% is where that. alex: yes. that is where the pain will start to kick in. at 3.5%, the risk-adjusted return coming out the fixed income is quite exciting from an asset allocation point of view. that will begin to occur as we move through 2019. we had a target for the end of this year and we're just about their. the .5% at the end of 2019 is achievable. joe: mike, what are you looking for here? october is out of the way, midterms out of the way, fed decision out of the way, most of earnings except for retail out of the way, so what our our next cues? mike: i'm glad you mentioned home depot. i have been droning on about the

housing market. scarlet: as a leading indicator or coincident indicator or lagging indicator? mike: sort of leading and and coincident. homebuilders have just gotten killed. the mortgage applications fell to a four your low -- year low. gone.fi boom is you could blame the fed, the usual suspects, you can also blame the tax reforms and the deductions on the coast affecting the housing market. to joinit is a mistake the comparisons to the financial crisis because we don't have this adjustable rate mortgage, issue we had back then and we do not have the structured finance issues. if i'm the fed and i'm looking for something to pause, the housing market is not looking great. caroline: the fed has been in some ways driving rates but also driving the dollar. alex, where does the dollar go

and what does that mean for other asset classes? alex: i think there's a little more upside in the dollar in the short-term because the market is still pricing interest-rate hikes for the next year. the fed is trying to talk up interest rate expectations. at maybe onericing or 1.5 i expect here -- hikes next year. there's an interest rate differential between the u.s. and the rest of the world at multi-decade highs and can really only go one way. for us, the long-term trajectory is the dollar is down from here. we estimate over the next 10 to 15 years the dollar will fall 2% per year. scarlet: you are also saying with yields offering something it is time to look at fixed income. within that space, where do you want to be and how much risk you want to take on? alex: there is risk floating

under the surface. what we have seen over the last tourism whered investors have gone on holiday to destinations they don't really understand. they picked up based on the yield and had done little research. i'm concerned with the fed raising rates and fixed income watching an attractive yield. i'm concerned on what will happen in some of the emerging market debt spaces and european high yields. just being cautious and your fixed income, going back to the bubble wrap in thing. it is not her. to hold core fixed-income at this stage it will give you not bad to hold core fixed-income at this stage. it would give you balance. [over talk] joe: in terms of the weak areas, are there any sectors within credit that particularly continue? alex: within the investor grade

u.s. space i'm concerned about credit qualities. go back six or seven years ago and it made up about 30% of the u.s. investment-grade space. passport to today, that number is over 15% -- 50%. cycle you are owning those triple b papers and before you know to have a fire sell on your hands. caroline: you are man of caution. a rally or not because goldman keeps saying we will see record ipo's and that one point said the risk rally is off. mike: i think after the midterms, everyone was teaching the trend saying the day after the midterms here comes the sad reality and year end catch up. after a day like this, i do not know. i think this is taking people back to some degree. i don't know and i do not think

we seen a mess of capitulation yet. i don't want to predict it. joe: some people change their views after. mike: right. i will tell you at the end of the year. [laughter] scarlet: mike regan, thank you so much. and alex dryden of jpmorgan asset management. that does it for the closing bell and for me. we will be looking at the high-stakes opec meeting in abu dhabi. this is bloomberg. ♪

caroline: live from the world headquarters in new york, i am caroline hyde. how the snapshot of u.s. stocks closed today, down. tech is the underperformer. scarlet: the question is -- joe: the question is "what'd you miss?" on itse: crude is longest decline ever turning up the pressure from opec and its allies as they gather in abu dhabi this weekend. containing the shockwaves, mexican stocks and the peso have losses after the president-elect says he will not change banking laws in the first three years. and a chill in crypto. initial coin offerings face governing issues and we talked to a ceo of a big blockchain company -- keep watching company about the road ahead. crude declining for the 10th day in a row. longest slump for wti in the the bti.a month --

in the space of a month, it slumps into bear markets. one point does oil price heard credit and equity markets? >> the u.s. high-yield market will come under a bit of pressure because it has a large percentage of issuance in the energy space. weaker oil prices, if they were to be extended, will hurt that market and that is probably one of the more talk about or vulnerable parts of the fixed-income market because it with the rising u.s. treasury's. if we look back to the last price crash, it was the emerging markets, significant hits and those areas where production is -- it is would expect hard to put a finger on it but being in a bear market, we will certainly catch the attention of the markets. >> all of the parts of the equity market that have been producing some of the highest free cash flow, out of them, it

has been the energy stocks. those companies have been in the balance sheet recession mode. they have been running their businesses for cash and offer some of the highest free cash flow yield in equity market. even though the oil price is not doing very much, was not a favored area for equity investors. joe: our next guest says the selloff in the oil market has gone too far. our guest is a global energy economist and joins us now. we wereast block, talking about how narrative falls price and that is so dramatic in the oil market. five weeks ago, the oil and sanctions and maybe hundred dollar barrels and now we might see 30 and the u.s. is pumping like crazy. what is the reality? >> i think this is overdone. overdone five was dollars ago.

we are in their territory. we have the 10th day that we had not had in a row, and it looks more oversold than we can go. caroline: what is the catalyst changing the direction? >> that is the right question. what caused this in the first place? there has been a temporary blowup in supplies. number one, we need more signals that the saudi's say we put too much oil into the market and we will take oil out of the market because of it. that may come on sunday. it kind of came on monday when they raised their official selling price. number two, seasonally, we find oil demand picks up. we find this demand picks up for crude significantly. that is another analyst giving us a signal -- catalyst giving us a signal. if we are going to wait for u.s.

crude oil production to stop growing, that will not work. ago,you said five dollars how do you derive a fair value? had you figure out where the price is where you say ok? jan: that's another question. what is fair value? i like midcycle. normal. $65 gives everybody enough to keep the supply jingling. get anr that and we will inverse reaction. $60-60 five dollars is fair range. for brent next year, it is $10 higher. dollars -- $75. anything over that is and overshoot. we expect and overshoot to last until the end of next year. joe: you mentioned there is no

point in waiting out the end of u.s. apply growth. but, earlier in the year, there were a lot of stories about bottlenecks so even though it was cheap to get it out of the ground, you could not its anywhere so what is the point? it sounds like lately there is more optimism. sundaythought ahead of it would go to a religious theme. [laughter] jan: discipline in the space did not work. there are pipeline bottleneck constraints. they are looming over us for two q and three q next year. that should constrain growth momentum some that we have a little more space in january and february. oil production growth will sustain, we think, at the beginning of next year at the first quarter, level of a little bit in q2 and q3 and go off in the fourth quarter. caroline: how much of a concern

was the keystone pipeline headlines today? jan: in a market like this, it is yeah, whatever. but, if you look forward and from the vantage point of less of canada, you have yet another problem. that was not part of the plan. that is a big pipe they were looking forward to. west canada doesn't have enough pipes. joe: what about the referendum in colorado on tuesday signaling a more liberal attitude towards fracking? jan: it was another thing where some of the markets were thinking maybe we will get less , some boundaries put on things, but as it turns out, people like making money first so that did not happen. caroline: you say one of the noises you hear -- need to hear for the catalyst is the saudis. why did we ignore them earlier in the week and will be ignore them on sunday? jan: it is almost like a dynamic . the market is pricing the argument.

joe: finally, iran. not really a factor? jan: that is another one where i think the market is misjudging this. the intent in washington is to really squeeze iran. we granted waivers from washington those waivers did not add to a whole lot. there will be a big impact from waivers and sanctions. those waivers rolloff. we learn from the trump administration that they are pretty good at messing with iran. it seems they really want to go that way and i do not think it will be any less impactful in 2019. caroline: jan stuart, thank you for joining us. jpmorgan says couldn't talk -- gutentag. why they plan to move across

country lines, this is bloomberg. ♪ bloomberg. ♪

caroline: banking on an exit. imorgan is leading a move many major investment banks to frankfurt as a result of brexit. .et's bring in michael it is not just jpmorgan. which banks are starting to move and what is the scale we are talking here? michael: you are seeing citigroup, goldman sachs, morgan stanley joining that movement. reporting,o our collectively about more than 250 billion in assets. this is a major move on the trading side. if you look at jpmorgan, what they have in the u.k. right now, you're talking about a third of that. these are significant moves.

joe: what we talking about personnel wise? do we know how much that asset management move associates with jobs? michael: the job moves have been in the thousands, but a lot of that depends on the details of the exit. how many bodies you need on the ground there. it does look like a lot of the banks are preparing for a hard brexit and then they can scale back if needed. caroline: we have heard of certain trading venues going to amsterdam and the repo market. how big of a knock is this to the city of london? is it as big as many feared? michael: it looks like it is getting there. zynga mental thing over the last couple of years, but it looks like it is going to be a significant blow to london and that sector. with the caveat this could all change. if there is some sort of more reasonable deal that may be some

of these plans are scale back. these could be worse case scenarios or contingency planning and we don't know what would -- what it will look like. michael: right. a lot of these asset moves are to satisfy regulations. if you are not in the eu, you have to have bodies in the you -- in that you. isthe that ship that relaxed, perhaps not all of that is needed. is the interesting hub fact. does frankfurt become up? you have bank of america who has picked paris for their trading operations in that you. to they miss out from not being where all of the other major banks are or is it an advantage? caroline: are there any winners -- frankfurt is obviously winning, are there any calls

liquidity or certain exchanges that suddenly without because euro clearing will be somewhere else for example? michael: that is a good question. it remains to be seen. you've seen people start to move but who the winners are, we will know little more into 2019. caroline: michael moore, thank you for writing down the brexit affect. a quick check on the latest business flash headlines. in germany, -- a company lowered its guidance for an investigation into steel price-fixing. that is the latest blow for the ceo trying to move forward with restructuring plans. american express says the people's bank of china has approved its license to be the firstborn for payment company allowed to build the network in the nation. the deal will let charges on american expresses charge be settled in china.

shares of [indiscernible] drop the most in three years. it signaled sales growth in china had slowed and the trade disputes could hurt demand for expensive necklaces. joe, a key question as you are about to fly to hong kong. i'm assuming you will come back with plenty of cheap watches. joe: i'm probably not going to buy it for everyone but i like to say the word. richemont. caroline: tiffany is off by some percent. joe: these are some of my favorite to watch from a global macro perspective. these are the first thing you'll probably cut back on his expensive watches and jewelry so very interesting to watch. caroline: you will go along saying at least. richemont. [laughter] caroline: why mexico won't be

seeing financial banking laws. this is bloomberg. ♪

>> i'm jenna dagenhart. a fast-moving wildfire has killed at least five people in northern california, and officials were the death toll will go higher. fire authorities say the blaze has practically wiped out the entire town of paradise. about 150,000 people have fled their homes including the city of malibu which has been ordered to evacuate completely. the fire has destroyed hundreds of structures. president trump says he is not spoken to his new acting attorney general, matthew whitaker about the russian investigation by robert mueller. there has been speculation whitaker was trying to rein in multiple -- mueller.

a law-enforcement official tells the associated press the gunman who killed 12 people at a center in california posted the social media during the attack. he posted to facebook and instagram about his mental state and whether people would believe he is saying. authorities have not determined a motive. the european union negotiators say there is broad consensus with the u.k. on the structure of the brexit treaty. that is according to the financial times who says the two sides of to see approval for next week -- hope to see approval for next week. global news, 24 hours a day on air and on tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am jenna dagenhart. this is bloomberg. jenna, thank you. no changes from mexico. the president-elect is now no new there will be n

changes in banking laws over the next three years. this is news that sent mexico stocks down for a second day before this announcement. damien, thein credit strategist at bloomberg intelligence joining us by phone. in the had a term around mexican peso and we are up have a percentage point on the day and we saw a turnaround for the banks -. >> we definitely overshot the downside in mexico. think at these levels, you have to give it a good look. if you look at a lot of the assets, the risk invesco assets them canceling the airport project and is a bit ofe banks

good news here. they've come a long way in a short. of -- in a short period of time. joe: you got at the concern and there is not any individual that i'm low is going to do or has done. he is making moves and perhaps doing things that will spook the investor community starting with the airport. now it is a back-and-forth on banks. is there a bigger concern there? the premiumlike you're getting paid to own mexico, but do you worry he could take governance in a different direction than what we have seen? damian: you make a great points. there is a heightened sensitivity to all things emerging markets. this is more of the same. this is not argentina. this is an investment grade credit. talking about mexico. while there has been political might have aarkets

lack of fiscal discipline with some of the things bally about -- valleyed about. it is a pretty decent time to be giving a look at some of these assets. there are a lot of good things going on in mexico. money closeazilian up even though it was a down day for the emerging markets. damian: europe hit the nail on the head. it is an uphill battle. they passed a hugely unpopular pension reform bill and given he does not have near the votes he needs, you will need a coalition. that is not something the markets think he is able to do. this will be an uphill battle for brazil. they are just getting started here. i happen to be estimate stick, but they were trading well to the four handle one month ago and now we are seek -- 373 so it

has come a long way and you might 20 be taking over the profits if you have been invested in cashing in. don'tne of the things we talk about anymore, you mentioned it when we talk about mexico, is turkey. we not talk about it in several weeks. they have had a nice rally with the lira quietly without getting much fanfare. in some of these really distressed countries from a couple of months ago, is the work behind us? damian: i don't think so. this is margaret 2019 story. things are going to get very liquid as we get into the holiday season. we have a month left. these really afford markets, particularly turkey and argentina? you run the risk of underperforming in risk on environment and we will see a few of those getting into the new year.

you need to build a meaningful position of time and it takes -- size and it takes time to get there. we see a little bit of the buying heading into this year and now that the midterms are behind us, it might have been a previous environment. caroline: things are not particularly shaping up nicely in terms of data coming out of china. where do you think china goes because it is such a bellwether for emerging markets? damian: china really is. [indiscernible] they have their work cut out for them. i don't think anyone knows where the bottom is in dollar yuan, but they have been selling nonperforming loans. they have had a lot of private equity buyers, but the fault are rising. no one knows what a restructuring process looks like in china. they have their work cut out for them. caroline: damian sassower, we love have you on the show. thank you for joining us.

staying with china, a chinese company has come up with a way in poundsir creditors instead of cash. filing oncording to a stock exchange. --t a good way joe: what is the catch? i would take it. anyone can you be cash, but not everyone can give you ham. caroline: in the u.k., they had this chart the company starting the fact that you'd be repaid in bonds with chocolate rather than with money coming back. the interest would always be that way in kind since they won. you have to be a chocolate lover, but you are off to hong kong psalmist you want to be eating ham? joe: you are very right. more on new regulatory

concerns facing ideas ahead. this is bloomberg. ♪

caroline: it is time for the business flash. setback for the xl pipeline project. the federal judge has blocked construction pending further review. transcanada has been trying for a decade to build a pipeline to deliver oil going to refineries have a gulf of mexico. u.s. regulators are cracking down on e-cigarettes. an official of the fda said the agency will restrict sales. the fda says young people having e-cigarettes is in the -- is an

epidemic. ico's with the hottest thing on the market a few months back with initial point offering raising $22 billion this year, but that number has dipped nearly 80% off the peak. thingrm issued a report 2017 ipos were 66% of their value over the year is in question was too much money being poured into an overhyped market? blockre let's bring in one cofounder and ceo from chicago renowned for this operating system. you say it is one of the most value cryptocurrencies -- valuable cryptocurrencies. when you raise money, you raised $4 billion worth. did you turn it into fiat and lock in the gains? >> most of our treasury justement is moved to fiat for conservative treasury. if you take a look at how we use the token, we did a token sale so it was through the business.

you can use tokens for a whole host of different mechanisms like fundraising events, invitations, this about anything imaginable. joe: and you have transferred most of that money into fiat. one of the pushes was all i ceos and the degree to which anyone had visibility into what you have done with the money. how do the holders and anyone not involved directly with your company see how that money is being held? brendan: as you go forward, you can see the things we are doing. we had announced a billion-dollar commitment to a program which is designed to start investing in business is building on the protocol. if you look at other networks and how they created tokens, a lot of it is done through proof of work spending lots of money on electricity's that ultimately gets burnt and contributes to a lot of environmental negativity. we are able to capture that value that other networks are intoe to do and deploy it

developers that are building on the protocol itself. we structured it similarly to proof of work networks outside of the fact that the we were able to capture that value as opposed to it getting burned. caroline: you said one billion will be invested in to future projects, what happens to the rest of the 3 billion? have developers got it in their hands or spent to a certain degree? brendan: we are building a large technology business. blockchain has the potential to create a new infrastructure for the internet. that is a tall order. we have been having up our development team and doubled the size over the last four months. we sold these tokens so they were revenue to business too much transparency into what we are doing in an ongoing business can take away the competitive advantage when we put out new types of technologies that allow people to take control of their privacy. joe: what are the problems with

so many of these blockchain platforms? nobody. seems to be using them for anything. . many of the most popular ones be like 100 or 200. what is going to change that? brendan: i think we are very early days. this is sort of like we have been building straw and hay and now we have cement. the first things you put together our leaky and wobbly, but if we want to build skyscrapers, we need to build cement. whole group of developers learning new technology, how to assemble it for the first time, and you are seeing hundreds of projects whether it is our platform or other starting to take place but it will take time for that infrastructure to get built and those business models to get in place and the users to adopt. the masses will experience blockchain the first time when they find the first product they use, when they find an insurance organization delivering something at half

cost and has a more equitable policy for their holders, and they realize this the blockchain-based project. it will be that introduction to bring the masses. caroline: we hear again and of bank saying it only cryptocurrencies but they like the blockchain and the technology underlies it -- that underlies it. what other applications are you seeing right here right now on your product and your protocol bearing fruit already? brendan: if you look at what blockchain is, it is a secure way to store and transfer data, where is the internet was a fundamentally insecure way. you keep hearing about hacking than data privacy leaks constantly and continually because in the old world, it is an arms race between the organizations and people in the fairies activities. blockchain is going to slowly create a new infrastructure for just about everything.

the technology is creating a social movement and social revolution driving new types of business models that align interests, where often times they weren't. they bring shareholder in user basis together. in combination of that technology and its are beating the value amongst stakeholders are going to lead to new business models that can be autonomously operated by the communities themselves as opposed to a centralized organization of shareholders. joe: you hinted there talking about the question of governance onehe blockchain and company is well-known for having constitution for governance of the blockchain. your own cto said that constitution was flawed and needs to be scrapped. what have you learned so far about getting governance right and what makes you think you will be able to find a workable model? brendan: i'm glad you brought that up. protocolhed the ourselves. eos is just one

implementation of the protocol and it leads to a set of rules. we do not post or put out a public constitution so the public blockchain has a constitution created by the community and they are iterating on it. we continue to give advice here and there but the reality is there will not be one blockchain for all purposes. different types of governance will tailor to different types of industries. i think you will see different things emerge. at the end of the day, whether you have a constitution or not, when certain things happen like having toal network change directions, it is about creating transparency as opposed to leaving that up to a small group of people making decisions in nontransparent ways. brendan, block.one cofounder and ceo joining us. thank you.

singles' day is the longest -- largest online shopping day created by alibaba. someone about their forecast of the event. that11 is not an event relies exclusively on anyone market in the u.s. or around the world. we will be working with over 200 of thiss as part enormous event. we do not expect anyone area to have a huge amount of influence other than china. trade not too concern of tensions between the u.s. and china as it relates to this event. in terms of the china economy, there is more concerns being expressed today and uncertainty about what will happen going forward. having said that, and economy of growth of 6.5% is growing well. -- we reported earnings and we talk to people about some softening in the

big-ticket items like consumer durables, washing machines, televisions, and big-ticket items like automobiles. in other sectors, particularly in things like cosmetics and food and fashion and apparel, we still see a very strong growth. there will always be cyclical impact that we will have to deal with. long-term secular trends are big part of what we're focused on with more and more people coming into the middle class over the next five years. andt another 300 million more of our business incorporating online and off-line expanding the pie in which we are participating. our 53% revenue growth seems to confirm things are holding up nicely. >> i want to zero in on american brands which are hugely popular on the alibaba platform. to be lowert sales as a result of china retaliatory tariffs on u.s. goods and

consumer sentiment dampened? >> i'm not expecting those sales to be lower at all. there are about 10,000, a little more than that, american brands on our platform. our consumers love american products and american brands. for this event alone, we have 180,000 brands. chinese and from around the world, who are going to participate. anything a market or brands within the single market, including the u.s., not have a significant impact on the but we are very excited about the brands that are participating whether it is johnson & johnson or any of the other u.s. brands that are going to be showing up this year because their products are used demand by chinese consumers. caroline: best the alibaba president with selina wang there.

coming up, cannabis investors have plenty to digest after a hectic week. the weekend is a short reprieve for earnings. we will talk that next. this is bloomberg. ♪ ♪

joe: it was an up and down week for cannabis stocks. voters approved to some degree --nabis use and legalization jeff sessions resigned. the big for canadian cannabis companies report earnings next week. forget all of these referendums and jeff sessions, now we can talk real business. what do we expect to see? , is it goingrter to encompass any canadian legalization time or what? >> we will finally see fundamentals. this is not been trading on sales and price of sales and eps

or anything like that, it has been speculative to this point. legalization just happened october 17 so you will see some indication of production and price you're getting so you will get the percent of what this looks like in an actual industry. caroline: $61 million is what we expect in second-quarter revenue from canopy. is that generally going to be the story with these companies? craig: i think that is right. it will mainly be losses and little to no sales. when you're seeing now is it is starting to mature. are and more u.s. companies asking do i really want to --est in a canadian this will give investors a window into what is happening. joe: do we know much about market share yet in the two or three weeks of league is lasix and -- of legalization? craig: we don't.

we don't have much of a window into what is happening. are licensedes producers so they have the right to grow marijuana and sell it in canada, but the more people i talk to, they bring up the idea tomato farmers do not get rich. it's the people that make heinz ketchup are the ones that could rich. joe: and there are not a finite isis the tomato growers. licensed-- finite tomato growers. craig: if we ever got federal legalization in the u.s., maybe growing the plants will not be the place to be. it is such early days and we will have an early window. caroline: it was an incredible story on the bloomberg showing some some almond vehicle companies will benefit. craig: you heard stories out of colorado with guys driving around with $200,000 of cash in a trunk.

in u.s., the industry is not bank. and canada you see how this plays out when the federal prohibition goes away. caroline: talking about money, looking at what the analysts are saying, when you look at gm -,- em, we are expecting a 250,000 growth from canopy. that will continue for the next year or so. we will see $1 billion or so in revenue. how much is that got legal risk baked into it? craig: that's a great question. that stems in the canadian market. the big question is how does this look outside of canada? these canadian companies made a big deal about potential to export to some of these medical markets opening up but i just do not think sitting in the u.s., the canadian market -- canada has drawn and people from california. the market is already bigger than california. inestors will poke around these companies but they are waiting to see the next shoe to

drop. caroline: great perspective, greg -- craig. that is all for "what'd you miss?" "bloomberg technology" is a next. joe: have a great weekend. this is bloomberg. ♪ is bloomberg. ♪

>> i'm alix in new york in four emily chang and this is "bloomberg technology." the biggest shopping spree in the world? not like friday, it is alibaba's singles' day this weekend. we speak with the president. plus, the race for amazon's second and potentially third headquarters is reportedly narrowing. while there is excitement in the cities on the shortlist, are they