>> coming up on bloomberg best, the stories that shaped business around the world. a split decision in the midterm elections. the president's party keeps the senate and the voters put the house to the democrats. >> question for democrats, will they legislate or d -- the f1 see hands down it's november rate decision and tesla decides on the new board chair. decisions made in last quarter show up on the bottom line as companies report earnings. >> the substantial justification

for the price when it comes to strategy and revenue growth -- >> growing with customers and volumes is the right picture. >> brags it probably the most unwise decision for decades. ramy: willie divided -- willie divided government have an effect on markets -- will a divided government have an impact on markets? bit think you have a little more of a mixed message in their. >> we have an atmosphere in washington is not good. ramy: it is all straight ahead on "bloomberg best." hello and welcome. i am ramy inocencio and this is bloomberg best. your weekly review of the most important business news, analysis, and interviews around

the world. let's start with a day by day look at headlines. on monday, china opened its first international import fair in shanghai. investors watched closely for in xito the trade issues jinping's address. >> xi jinping is promising further tax cuts on imports to affect trade imbalances. this will be at the import expo in shanghai for calling on inclusive risk. >> in a world of deepening economic cooperation, practices like the law of the jungle in winner takes all only represent a dead-end, and inclusive growth for all is surely the right way forward. ramy: he talked about opening up the financial sector, agricultural, and mining sector. he talks about additional removingopen up

foreign caps on ownership and education, and reform of the global trading sector and rules. repeating the stock phrases we heard him say and almost two years ago and saying he was to see reform of the wto. whether or not this will come to the point where those officials in washington and brussels see this as being enough in addressing those issues is yet undecided. it looks unlikely at this stage. this is more about moving, edging in a direction of openness rather than a wholesale big bang. >> united states ramping up pressure on iran's banking sector with sanctions on 700 entities. >> the maximum pressure exerted by the u.s. is only going to mount from here. companies from around the world need to know we will be strictly enforcing our sanctions. >> enforcement in the u.s. has been significant which is what is driving this. you can be fined upwards of $9 billion for violating these sanctions.

for secondary sanctions, it could cut an entire company out of the market and take institution and ban it from doing business in the u.s. i can put other measures in place to freeze assets in the u.s. so it can have an impact, but it has to be enforced. enforcement is light this year. >> what changed the market today? >> i don't think a great deal did change it. disappointment in that we have not got the details that matter so much to the market. what was missing? hard numbers. and what proportion are the going to have to reduce imports. how do you price oil six months out if you don't have answers to those questions? ramy: midterm results overall have come in where the market thought they would with the democrats picking up 26 seats in the house and republicans gaining seven seats in the senate. >> this is the outcome markets were expecting. we really said midterms would be

more of a political signal than a market signal. i think that has probably held up so far. >> what does it all mean? tax 2.0, obamacare reform, infrastructure and investigations as well as the potential for some trade alliances with the white house. the populace streak that exists in the trunk coalition also exists on the left. are democrats going to legislate or investigate and can they do both? >> nancy said last night about bipartisanship and getting together and uniting. she used the word uniting and whichisanship statement is so important because that is what we should be doing. >> you know we have requested information from the treasury sanctionsything from to deutsche bank and we know --tsche bank has identified been identified as one of the biggest money laundering banks

in the world and one of the only ones who were amenable to providing loans to this president. we want to know something about that. >> administrative shakeup hours after the polls closed. jeff sessions announced his resignation. is this really resignation? >> it appears jeff sessions was pushed out. we've all seen publicly what led up to this. try has been hammering his own attorney general publicly in tweets and statements for a long time because he is upset sessions recused himself from the mueller investigation. matt whitaker will be the acting replacement. trusted trumps a ally and critical of the mueller investigation. there are a lot of questions being raised as to what this new individual is going to do. >> we have the s&p closing

higher for the sixth time in seven days. we're getting a little bit of an extended relief rally as well closing basically at session highs for the major indexes. by the depth of the market move overall because results were generally what was expected to happen. to have this much relief that an election is over is a bit of a surprise. we first started talking about midterms, health care and financials were the key sectors to watch. i would say the big stunner for me is how much this out performances on a day where we got a result we thought we were expecting. we are moments away from the rate decision and officials are widely expected to keep rates unchanged and with no news conference scheduled in no updated forecast to be released, investors will only have the statement to look at for any

signs to the outlook. >> the fed counselee's policy statements to send a clear signal. in this case, there were tweaks but nothing to change the view that this federal reserve on track for a rate hike in september. business investment has moderated from a rapid pace. previously they said how strong investment was, but it pulled up sharply in the third quarter and they said household spending has continued to grow strongly on the unemployment rate. overall, here's the most important part. they see the economy rising at a strong rate. >> inflation has slowed again in china and the economy drags in the trade war escalating. atyou have inflation holding two point 5%. it is the highest since about 2014 if you strip out the -- 2.5%.

it is the highest since about 2014 if you strip out. the pace of growth declined up to 3.3%. what you're starting to see is a trickle-down effect of the trade war starting to slow the chinese economy coinciding and hitting the pricing power at factors. >> the chinese government has noticed a slowdown and is doing what he can to try to prop up the markets and the economy. they are saying should be done is large banks should put one third of their new corporate loans to smaller companies, private companies. that did not go over well in china today. chinese banks down 40%. they own directives on who to lend to -- directives on who to lend to don't go over well. outputs on thell

iran sanctions. as opec lost control of the narrative? how does a gain control back if so? >> it does feel like they have lost control of the market at the moment. they thought they had a deal with the u.s., and the u.s. would be hard against iran which was a common interest. what happened at the last minute, they issued wavers which added about one million barrels back onto the market. they will have to get back on sunday and they will make a decision, but they will have to come out with very strong language to show they are still in control and can still balance the market and do it without too much friction. still ahead, as we review the week on "bloomberg best" instant allowances of mid--- instant allowances -- instant analysis of midterm results and more of the week's top business

headlines. a positive momentum from pot. theyople are saying expected to be a cluster affect. ♪

ramy: this is "bloomberg best." i'm rainy inocencio. let's continue the global tour of the top business stories with what could be a major twist in amazon's quest to choose a city for a second and third u.s. headquarters. very public year-long search for a second headquarters could be coming to an end. online learned the retailer is close to agreements that was set up an hq to but possible hq three. one city will be the possible city of arlington and northern

virginia. the other is in queens. amazon is scheduled to make an announcement by the end of the year. what you make of not one but two quarters? hq2b. and- hire 50,000ing to people in another city, you're probably going to bring the same problems there. they need to tap areas of technical talent, bc and new york being the two biggest cities. couldrobably decided they go smaller in each city and get the tax benefits and tap the resources of talent. >> let's talk a little bit about italy. they will not budge on a budget even after the finance minister urged for them to reply. the european commission and

the italian government continue to but heads over the spending bill for 2019 which includes aipac and public spending. they want them to submit a new version of the plan and i spoke above head that said anything else, italy needs to show it is credible. >> credibility is the word. we need credibility in the numbers and strategy. we need credibility into the future. >> in italy, the company's finance minister insists the budget will remain unchanged. he said this after meeting with the euro group's president. >> the government intends to confirm the main pillars of the budget plan. >> it's clear at this point they cannot make any serious changes. it won't make any changes and that is mainly a political reason. they have to keep their voters happy and this is a populist government. making those changes is

basically imperiling the government. what do you do? for political reasons, they have no options. >> the big shorts, steve eisman has earmarked to bank banks as targets. he says the u.k. is the biggest threat will not say the bi banks here shorting. -- he is shorting. he has a list about -- of about 50 companies he may bet against when jeremy corbyn becomes the prime minister. >> for the u.k., he is talking about u.k. stocks in general. there is concern about nationalization and that is what he is pointing to. it's interesting to point out testwo banks in the stress on friday, the european stress test, were two other european banks.

clearly, no deal scenario being a factor that could play a significant role in the for those institutions. toppeda's exports estimates in yuan in dollar terms. >> the top line was the export number of which came in at 15.6%. front loading seems to play a big role. 10% of tariffs on $200 billion worth of goods and they are expected to rise to 25% on january 1. there's a sense that the orders are pushed through ahead of the event. the yuan is down 7% year to date. the month ofin october compared to 17 and a half percent back in september. their policies around boosting infrastructure which may have played a role. most economists think the picture will be early -- different early 2019.

tesla has appointed a man to be chair of tesla. what do we know about the new chair? >> he has been the cfo of a big australian telco so he does have experience -- she does have experience for a few years. she even herself is an accountant by trade. there's possibly some disappointment. >> big changes for the top of citigroup. the board named john dugan to be the new chairman.

john dugan comes from a regulatory background. talk to us about what that means in terms of oversight for citibank. >> don't miss the forest and the trees here. you can have a more optimal scenario and think of somebody who is more of an investor or somebody else who was not involved in regulation. they made the decision to keep the ceo position separate from the chairman position. citigroup shareholders, including myself, still have a nexus that of eyes looking over their welfare. move to keep a position separate. ge is selling its commercial lighting division. they are streaming the manufacturing portfolio here. it does not commit much in terms of overall revenue for ge, but it is an important post coming from larry called. -- colt. >> they have been an investor

mode for quite some time but this business is one they said they would not sell. viableonsumer business has been on the block for some -- quite a while. they want to keep the commercial parts they are selling today because that has more of a digital aspect to it. it is about rethinking traffic lights and streetlights and the way we do traffic management. they sell lighting and software to municipalities and state regions like that. that was a growth story. onyou see ge pulling back spending and research and development, this is probably not a business that made sense for them to keep. the u.s. marijuana market just got a lot greener. michigan became the 10th u.s. state to recreational eyes. and missouri and utah -- pot andonalize missouri in utah come on board. how significant where these

passings of legislation? this seems to be a big reaction. >> it is a big deal. michigan is important as the 10th largest state. in the first in the midwest. people say they expect to see a cluster effect. here comes illinois and ohio. it becomes an anchor in the midwest as the industry expands to different regions. the former goldman sachs boss personally held times -- ties with will asia. years before, -- malaysia. years before, and i'd identified high-ranking executive and to do in u.s. court documents attended a meeting with the then malaysian prime minister. why is this important? >> it is important because it shows goldman's defense, they would be in negotiations and

their defense would be that tim leistner lied to them. it was not their fault and we did not know and we have no idea that the money we raised on behalf of them would be stolen and plundered by the prime minister and his cronies. , a fact that their ceo detail oriented guy, had this meeting is more embarrassing than an illegal problem. it looks bad in the rearview mirror now that we know the what -- know what happened. ♪

ramy: welcome back to "bloomberg best." bloomberg new economy forum to place in singapore this week. leaders in business, finance, politics and policy rather to address the most important

issues and the biggest challenges. all that in a time of huge political transitions. on the second day of the , results-- conference were coming in and erik schatzker set down for an exclusive conversation with the carlyle group cofounder. what the new balance of power government might mean. >> hopefully we will bring together democrats and republicans. i've been interviewing great historians once a month and we get democrats and republicans having dinner together, sitting with each other, and it is a small way to make a difference and hopefully they will work together better. >> there the effort of yours and the proper solvents -- problem solvers caucus. are they making a difference? >> it is a small difference but it takes a while. you cannot change the atmosphere

overnight. >> is this the worst atmosphere you have ever seen? >> i've not been around that long, but yes. i worked in the senate in the late 1970's. bipartisan legislation does not happen now and it will not change overnight. --s congressional gridlock is congressional gridlock by for business? >> the economy is doing well. hand, everybody wants things to work together better than we are now. business people want congress and democrats to work better. has said maxine waters if the democrats win control of the house and that is the job she gets, she will do to banks " what you did to us." she is not necessarily referring to carlisle and when i see you, i do not mean david rubenstein. what do you think she means by

that? >> i've not talked to her and i don't know. a lot of people say things and campaigns. let's wait and see how the election turns out and see what happens when congress has to legislate. you think democrats will be hostile? >> i don't think so. sometimes democrats have been financial to the -- done things beneficial to the financial industry. i don't think you'll get legislation that will hurt the financial industry. ramy: coming up, more political reaction from the new economy forum. another weighs in on the midterm vote. >> it looks to me in some respects that the economic issue did play into the election. ramy: in global trade stays a hot topic. was at thesecretary china import expo and so the outlook is bright despite brexit . >> countries are lining up for

the u.k.. ramy: coming up on bloomberg -- this is bloomberg. ♪

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♪ best.s is "bloomberg i'm ramy inocencio. let's revisit global reaction to the u.s. midterms. control of the house swung back to the democratic party. a number of important investors were at the new economy forum on election night. schatzker began his exclusive interview with the goldman sachs ceo david solomon by asking what he thought of the results. ♪ >> i think from a market perspective and from an expectation perspective, even in historical context, not unexpected. here, look forward from i'm not a big believer that this

will have a big impact on policy or action or washington or where we are in the next two years as we moved to the election. >> what if, as some people have said, the democrats, now that they have the house committees, they begin a never-ending series of investigations with subpoena into things that the trump administration and from family -- maybe even the republican party -- has been doing? that would probably slow down the business of government. it makes me wonder whether it would be bad for the economy. back -- i think balance can be good in government. both sidesis balance have to work harder to get things done. i would say is i don't think it would be an effective strategy for the democrats to go down that road, but if they do go down that road, i think that would be a missed opportunity.

candidly, i would hope that the path in the process forward from is one that gives balance to shared responsibility and governance, a focus on where we can find compromise. ♪ >> your former boss, what do you think you going to say about this? >> which one? [laughter] >> you said you wanted to have fun. >> donald trump. fullthink donald will take credit for the pickup of seats in the senate. looks like the senate could go 52, somewhere in that area. mainstream incumbents losing. he will point out that he campaigned in those states hard. he will say it is a complete ratification of his policies and

that his policies are working. >> ok. if you were there, would you advise him to say that? my personal opinion is you got an election that gave you two results. a senate that is going one direction, a house that is going a different direction, and the makeup of the house right now is getting more and more interesting, much more diverse, many more women, women voters came out and voted and they voted for women, which is a very good thing. the suburban population came out and voted. i think you've got a little bit more of a mixed message in there. but it does look to me in some respects that the economic issue did claim to the election, the fact that the u.s. economy is strong did play into the election. >> ok. the markets open in new york tomorrow morning. what's going to be the impact?

markets up or down? [laughter] >> you want to coin -- want a coin? >> i don't think the outcome is a big surprise. the markets obviously had a big setback and is reassessing itself, the market is trying to re-stabilize. said, i on what gary think the big narrative will be women. they haved for women, a much more diverse house. it's not just women voting, more millennials voting, and i believe that will shape the election for the next two years and many years before. ♪ what did the midterm elections mean for markets? softer dollar? >> i think the markets will react to this as back to fundamentals. when you look at it, it is not that surprising for an incumbent government to suffer setbacks.

when you look at the history of presidential terms they make one or two major reforms per term. now is markets go back to fundamentals, it may mean there is no longer another is of fiscal stimulus but not necessary given whether the economy is performing, where inflation is. into thee will get election cycle in markets will react more to the fundamentals for the next few months. ♪ >> you talked to the president on election night. how serious is he about truly compromising with democrats? >> i think he's amazingly serious. one thing we have learned about this president is he is practical in the dealmaker and he puts aside the traditional

republican for loss of fee of practicality. i think it's an interesting time. -- thentry and it country is in debate and that's not a good thing in one sense but participation has never been higher. voter participation has never been higher, the of minorities has never been better and the news agencies, the dialogue has never been higher. the democrats are smart. taking on this president -- for sure there will be investigations and rhetoric but he is pretty good that game. 2020,en game going into it's not good for them. full-scale, for example, on infrastructure. turns ony, because it

a dime. i don't think you will see this long tail of him continuing to stay on the fight, he will get things done. ♪ >> now that the u.s. elections are passed, attention focuses more sharply on brexit negotiations between the u.k. and eu and what may happen to trade in the wake of their divorce. stephen engle caught up with the u.k. international trade record terry in shanghai this week and got to ask some very direct questions on the subject. ♪ >> have you spoken to the chinese governor or officials about their opposition to the plan to have its own terrace? chineseything, the officials we speak to regard brexit as an opportunity, and they see that the u.k. will be able to set its own trade policy for the first time and the further you get away from the epicenter of more people can see

the opportunity that it brings. we want to replicate the eu andffs as much as possible there will be some disaggregation and we have a methodology in mind. described asat we disaggregation -- >> but that could delay the process quite considerably -- i heard some europeans throwing their hands up in horror in my own party that we are currently trading on schedule as an eu member. since 2004 ine 2016. the services schedule that we are trading on, --

>> how important is that to you? it's very important for the butre of the united kingdom we have countries lining up to talk to the u.k., with the benefits of free access to one of the biggest economies in the world. there was that in financial services in particular and want to ensure the u.k. cantilever. is, is where the advantage some have been complaining that they didn't get high level talks from the chinese government and we had the chinese president, the foreign minister, and trade minister. i think that's indicative of the attraction. ♪

♪ this is "bloomberg best." i'm ramy inocencio. let's get back to our roundup of the week's top business stories with highlights from another flood of earnings reports, starting with results from disney. ♪ strong, itsme in fourth-quarter profit beating the highest estimates fueled by movies and theme parks. bob iger is betting on the future built on streaming. >> these are great assets we are buying, that are not only doing well today but we believe can do incredibly well in the combined entity as we move more and more in the direction of direct consumer businesses where intellectual property will become critical in brands will become critical. as well as the talent required to make this kind of product,

all very important. is substantial justification for the price when it comes to strategy, revenue growth, and bottom-line growth. there are opportunities for cost savings. there is the overlap in our businesses, but this is largely going to be driven by having the ability to operate even more successfully going forward, and when you think about all the transformations going on in the media landscape, having this kind of scale, it's vital to the success of this company and its ability to grow long-term. ♪ >> big day for european bank earnings. unicredit recorded third-quarter profit that missed estimates, writing down its turkey unit. there are five consecutive quarters of contraction as the key equities trading business had a 19% drop in revenue.

what exactly happened at unicredit? >> unicredit is at the tail end of the turnaround focused on the cleanup of the bank. now investors are looking for sustained growth and unfortunately there seems to be a bit of a slow down in that expected expansion. it was right across the board, and i think that is evidence that they are much further down in terms of focusing on their core businesses to levels of profitability. ♪ at commerzbanknd is being slowed by cost and competition. falling revenue from corporate clients and low interest rates. spending, or spank is on marketing to acquire new customers. >> more even in the first nine

, the strategyyear is growing with customers, albeit in a difficult and competitive environment. what would i expect going that we i would expect have to deal with lower interest rates for a while and in that sense we left out basically unchanged. i think you will see something boring. ♪ >> credit agricole says it is on track to meet targets after a strong third quarter. at theosted earnings investment bank for the second straight quarter, driving up revenue by 5%. give us more detail on why you decided not to buy back shares. committed to a 50% cash payout dividend.

we think it's a fair remuneration for our shareholders and we think we need to keep the remaining part of our earnings to fuel you all the organic growth of our business lines and we are in areas where there is growth and credit demand. to fuel and finance acquisitions as we did already in the last someears or maybe to say potential regulatory headwind that could occur from time to time. this is the reason we think the dividend between 50% and 50% earnings is fair and reasonable. ♪ is seeing the benefit of its tech investments after they exceeded analyst

estimates, but they are facing tough questions about the relationship with saudi arabia, the biggest investor in his $100 billion vision fund. >> this year we've had masayoshi son talk about something two or three years -- that first fund, may have $45 billion, there a huge investment in this program. depending on how investors react, what we see about the scandal could be critical to whether they can come in as credible investors, whether they will be able to accept money. >> softbank founder months ago she son announced they will not be cutting ties to saudi arabia. intead, it is doubling down the kingdom. softbank announced plans to develop a $1.2 billion solar plan and saudi arabia expected to generate 1.8 gigawatts of power per year. thosea year ago, all

members were detained and a few days after we learned that we learned that softbank plans to invest $25 billion. masayoshi son she skin is scared in the wave of negative news to announce these partnerships, and that appears to be what he's doing again now. ♪ >> adidas has increased profitability for the year as the company relies on sales from north america, china, an online to make up for sluggish revenue in europe. they are on course for their fourth straight annual gain. you are guiding higher on net profit but what is the overall message? how positive is the message you want to get across? >> we are coming out in the and we aremonths continuing to accept strong growth in china with 18% and

online 76 for five. china online in north america continues to be accepting strong, sluggish in an economy probably theexit most unwise business. overall, a very strong quarter and strong year in 2018, -- ♪ >> lehman's has raised dividend to put a positive spin on that years outlook after games on forstrial software made up the struggling power and gas operations. buy back 3lan to billion euros of shares. positiveually a because that will show the with the representatives

in structuring and this is what we are executing on. iswe take away the charge actually about 5% which is very hard to find an industry like that. so obviously it's going to be a constant struggle, it is quite a set of capacities. on the other hand, we have a very robust and well-established service business which will help us in the new business environment. ♪ $73.2 million is what aramco nevers has delivered, forget the 28 at the end, that's the key thing. they are to be acquired by barrick gold corporation. what will the new benchmark be

when this company gets together? how are you going to grow and deliver value? ,> it's all about quality quality management, quality financials. that is what i've always said. mining, at to be in good place to start is with high quality assets, then you can survive the cyclicality of the industry. ♪ shares of cbs moving higher with the strong prescription. that looks good. what about the future? that is the big deal that everyone is thinking about right have been going to this lengthy antitrust process, not only getting signoff from the feds, but to go through 28 states.

they say this thing is going to close by thanksgiving so we will wrap that up. we are likely a couple weeks away from one of the more transformative deals and health pharmacy andg pharmacy benefit manager with a pretty massive health insurer. ♪

♪ join the mliv team. it is on your bloomberg, join it. this is the question. what will markets may of the midterm election? >> there are about 30,000 functions on the bloomberg, and

we always enjoy showing you are favorites on bloomberg television. maybe they will become your favorite, too. here's another function, to uic go. it will lead you to our quick takes, where you can get important context and fast insight into timely topics. here's a quick take from this week. ♪ ♪ it can letter sidewalks, menaced pedestrians, and endanger the writer's lives. over the past year, at enabled electric scooters popped up in cities around the world, inviting a wary public to hop a ride. indignant local governments are scribbling to regulate. it may come as a surprise that they can be exactly what traffic choked cities need. this is your bloomberg quick take on east scooters. download an app, find a scooter, unlock it, go for a ride. when you are done, leave it behind. rights can cost less than two dollars.

both over and left have scooters now. by their estimate they are all over the place. if you aren't using them, they get in your way. because people are just learning how to use them, they tend to ride them in obnoxious ways. it annoys people. >> cities like cleveland, san francisco halted operations for several months to create a permanent system that cap the number of scooters allowed. but growth has continued. there are new apps offering scooters and 40 cities. but despite the controversy, they have their defenders. in dense urban areas, cars often are the fastest way to get around. many cities have turned to buy c-shares systems because they take up less space than cars and save on carbon emissions. see urban planners also scooters as part of the future of city transportation. >> the hope would be you would eliminate a lot of hardships

that would get cars off the road, create more protected lanes. that would broaden the demand. it would be a virtuous cycle. >> but despite each company being valued at more than $1 million, it is too early to say if they will become viable. >> you have to look at how long it takes to pay off the vehicle, how long the vehicle stays on the road. we don't know exactly how much it is, but it does seem like you can pay these things are fairly quickly. they are relatively inexpensive. but they also get completely trashed quickly. you will take care of your own bike or car, but no one ever washes a rental car. ♪ ♪ and that was just one of the many quick takes you can find on the bloomberg. you can also find them at bloomberg.com, or with all the latest business news and analysis 24 hours a day. that's all for "bloomberg best." thank you for watching.

i'm ramy inocencio. this is bloomberg. ♪

♪ >> i'm alix in new york in for emily chang and this is "bloomberg technology." the biggest shopping spree in the world? not black 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 ready for the giant to set up the digs? we will see what is next for hq and what that meaor