haidi: i'm haidi stroud-watts in sydney. welcome to "bloomberg daybreak: australia." shery: i'm shery ahn in new york. we are counting down to asia's major market open. ♪ haidi: please other top stories we are covering in the next hour. oil will be in the stock -- in the spotlight. saudi arabia is reducing exports starting next month. alibaba delivers a shopping sensation. sticky -- seeing a record $31 billion of sales in 24 hours. the lehman brothers, the fed

says u.s. banks are still falling short on risk management. check oft's get a markets closing on friday sessions. we saw u.s. stocks being pulled down to we saw the s&p 500 lose 1%. the dow also lost 8/10 of 1%. we had weak earnings coming out of the tech sector, which pulled down technology shares. the nasdaq losing more than 1.5%. the energy sector was also down. the 10thound for consecutive session which was the longest losing streak ever. we did see saudi arabia signaling potential production cuts during the weekend. we could see a rebound in oil. let's keep a close eye on that market. we will keep you updated on that story later in the program. also sawantime, we disney's strong earnings offset all those losses on the dow. sort of minimized the damage and the dow falling only 8/10 of 1%. we sawrth mentioning,

a weak friday committee was the second consecutive week of gains for the s&p 500. all of this leading into the asian markets on a monday. haidi: yeah, on a monday. looks like a muted monday morning and australia. wake of u.s. stocks losing momentum after that postman terms pop. week on the data front. domestic activity indicators out of china. jobless numbers out of south korea. as well as a flurry of central bank decisions out of southeast asia. ahead toso looking third-quarter gdp out of japan. lots for investors to contend with. we have geopolitics front and center with the aipac economic leaders and leaders make -- meeting taking place in new guinea this week. sydney futures come on the back foot. 6/10 of 1%. oil looking like the indicator 1%.side close to

new zealand, we are seeing the downside of 3/10 of 1%. as well as weakness across the aussie and kiwi currencies can let's get you to first word news with ramy inocencio. ramy: good morning. president emmanuel macron called for greater international corporation is a world marked 100 years since the end of world war i. occasion to criticize the protectionist policies embraced by america under president trump saying patriotism is the opposite of nationalism. nationalism is a guitar -- visit the trail of patriotism. angela merkel warned the world is regressing on human rights. opec and its highlights have become laying the groundwork for a pert curves next year with saudi arabia announcing reduction in crude shipments from next month. after the meeting in abu dhabi, the minister said the group was responsible and would work hard to balance the market. the kingdom will export half a million fewer barrels a day in december with wider cuts seen in following months. >> we will only cut if we see a

andistent glut emerging, quite frankly, we are seeing signs of this coming out of the u.s. we have not seen the signs globally, nor can we protect that they are coming. ramy: to the u.k. and sterling open weaker in early east training as theresa may fights to keep her brexit plan alive. pro-eu conservatives say it is the worst of all worlds, while eurosceptics are demanding a clean break. hen-claude juncker says thinks a deal will be struck soon because a disorganized split would make things worse for both sides. online shopping and alibaba set a new record for singles' day with $31 billion of sales in 24 hours. the online extravaganza featured mariah carey and cirque du soleil with apple and dies among the most popular brands attracting customers.

singles' day is a bellwether for the chinese economy offering a gauge of consumer sentiment alongside the trade war between the u.s. and china. global news, 24 hours a day, on air and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm ramy inocencio. this is bloomberg. thank you. is said to have told associates he will not cut mueller's to robert investigation into russian election interference. joining us out of washington is bloomberg editor ros krasny. what are whispers about what we are asked and what comes next, what is the latest? democrats are very concerned about the appointment of matt whitaker come as you know from the last couple of days. they have written to the trump administration suggesting he recuse himself from the special -- from overseeing the special counsel probe. which pretty much is why people think donald trump put him into

the position into the first place. or sourcess said, have said that he does not intend to cut funding. in force today, kellyanne conway from the white house and lindsey graham, saying they do not think his past comments criticizing the probe would have any impact going forward. it is looking like another big partisan battle in washington. because matt whitaker has been critical of the probe and now he is in charge of it. i think democrats would like to see legislation passed to protect the probe. on what lot will depend happens with the final results of the midterm elections. we are now hearing that we are seeing a recount on some of those racist pig give us the latest update on the midterms? ros: it is very interesting. for those of you who recall the it islection, in florida,

a flashback to hanging chads, going in the same direction. the senate race in florida. partisan swiping battle or president donald who is the outgoing governor and possibly the incoming senator both had harsh words over the weekend. thedeadline to finish recount is thursday. keep an eye on that. just a bit of a mess in florida. trump on the weekend also lost another lieutenant in the house of representatives, another longtime republican in rohrabacher was defeated. he could also lose the arizona senate seat that had been held by jeff flake. we know that from tuesday's elections, there was a wave against republicans.

maybe not as strong as some thought. but definitely a shift. on final count this week various house races and senate races may show that that is continuing. president trump is in europe attending the commemorations of world war i. it certainly seems to be cutting something of an isolated figure. ros: he certainly was. as remy said in the previous president macron and angela merkel of germany both pointed remarks about nationalism, patriotism, and putting themselves on the other side of the coin from president trump. it should not be a surprise, it seems like whenever the u.s. president goes to these multilateral meetings, he seems to be the outsider. that was certainly the case is week. coming up in the next few days, trump is passing on two big

asian summits in singapore and new guinea. he is sending mike pence in his place. don't knowuntries where they stand in terms of the u.s. commitment to trade, to defense, and any of its other multilateral agreements struck over the past few decades. in paris, america first is definitely president trump's credo and he is not going to be swayed from that by an election or anything president macron might say, i would think. shery: thank you so much for that. ros krasny in washington. joining us with more insight is jacob kierkegaard, senior fellow at the peterson institute for international economics. always great to have you with us. thank you for your time. ros, theseom diverging views coming out of europe this weekend. we also heard from the eu hasident saying he

different views from president trump when it comes to the global order. what is the fate of transatlantic relations right now and is there any hope for a breakthrough here while president trump is in office? jacob: no, i think the best we can hope for is essentially a cold piece if you like, where we are now, there is not a cease-fire on trade. they are feeling each other out on the prospects for a broader zero tariff agreement on industrial goods. willeality is i think it be very difficult for the european side to actually enter into meaningful trade negotiations with the united states because of the upcoming european election season. a new commission, etc. the question is, does donald trump have the patience to wait maybe 18 months for that to be over? or, is he going to wake up one

morning and say, i want all those tariffs? if that is the case, you will have a full-blown trade war between the united states and the eu. ofry: it was also a big show reconciliation. we have heard that chancellor merkel is going to quit as head of her party after nearly two decades. what does this mean for the future of europe and the relationship with the u.s. once chancellor merkel leaves power? that: there is no doubt angela merkel is the longest-serving european leader. she has clearly been a political leader of europe for the better part of the last decade. i think at the same time, we should be clear that at least the early signs of her battle inside her party in germany suggests you will have a choice between candidates that are broadly

pro-european and broadly shares her views. both with respect to the eu and certainly with respect to transatlantic relationships. which means i think we are looking at a scenario where ultimately, the role of germany in transatlantic relationships is one of pretty much continuity. the asia-pacific, we are setting up for summit season as we have come to know it. week, there will be an elephant in the room, the absence of present trump. does the fact that he is sending his vp suggest this pivot away, or a less important engagement with asia? jacob: i think it is striking that he does -- that president trump himself goes to a set of celebrations in paris and then skips most of the events there, and does not quite frankly bothered to go to meet with the other aipac leaders, but senses vice president instead.

all, a few weeks ago gave a speech in washington where vice president pence essentially called for what i would characterize as a new cold war between the united states and china. i think this is about the worst possible political signal the united states can send to its asian allies. and i am quite frankly flabbergasted. does that mean some of these middle economies, particularly if you look across southeast asia, will they be forced to choose and perhaps there is an argument they should be choosing australia, for example? there are more important trading partner which is china, not the united states. jacob: i think there is no doubt that if the trade friction between the u.s. and china degenerates into traditional great power rivalry, and something that begins to look like a new cold war, yeah,

absolutely, everyone will be forced to choose. certainly, america's allies in asia, but also in europe for that matter, that have strong trading relationships with china, will be in a precarious situation. administrationp has also talked about withdrawing from the 1987 intermediate range nuclear forces treaty with russia. is this the right way to address the unintentional result of that treaty, which was giving china and advantage in missiles into the pacific? jacob: no, again it is a very bad signal to send. even though we can certainly debate whether or not russia itself has been adhering to that treaty. but for the united states, which traditionally has been the guarantor of the multilateral world order, if you like, to once again unilaterally pull out of a very important arms

reduction treaty, sends a signal to the rest of the world that it really is america first. and if that is the case, then it increasingly will be america alone. haidi: always appreciate your time and insight. jacob kierkegaard, senior fellow at the peterson institute for international economics. still ahead, another record-breaking singles' day. all of thecrunching numbers from alibaba's latest extravaganza. shery: the fed sounds the alarm on risk management's short -- risk management shortcomings. more on that next. this is bloomberg. ♪

counting down to the start of trading this monday morning. a new week of trading. a lot for investors to focus on. geopolitics at the apec summit

taking place in this part of the world. we are looking like we are setting up for a sluggish start to trading. new zealand trading lower on the monday session. sydney futures setting up for a downside after tech drove a selloff in the friday session on wall street. i'm haidi stroud-watts in sydney. shery: i'm shery ahn in new york. you're watching "bloomberg daybreak: australia." the federal reserve has more to worry about than just inflation rate in its first report on bank supervision, it is more than 40% of major u.s. lenders are falling short in critical areas of risk management. our global economics and policy editor kathleen hays has the details could we marked the 10th anniversary of lehman brothers. bankers are falling short. but they will not tighten the rules? kathleen: not just yet. i think they want more time to see how this is going and perhaps pointing out that there are still misses that might encourage big banks to take another look at their practices and get them more in line with what the fed is looking for.

it is interesting, 40% of banks are failing on broad measures of risk management. the fed does give the banks high marks on the amount of capitals they are holding and liquidity reserves. this is one of the biggest pushes coming out of the fed, coming out of basel. have to hold more capital to be safe in a big downturn. banks -- the bigger risk from it -- from mismanagement, that is surprising. cyberattacks, not surprising. and some failure to protect the banking systems. they see more things -- say more things need to be done. scored well. randy quarles spoke in washington on friday. he sees possibles changes whending not announcing they failed to be allowed to increase their dividends or do share buybacks. make them more transparent. things like that. he does not see any need for new countercyclical stress capital

buffers. a new rule to cover that. here is what he said on friday. areinancial stability risks moderate currently and therefore in our -- and therefore are in a methodical framework. again, randy quarles is in favor, as expected, he has been seen as someone who thinks the rules are too tough. but maybe eases some rules. meanwhile, an announcement from the fed that the end of this month we will be getting a new report on financial stability, that they will be issuing every fall and spring. is putting ae fed big spotlight on this. 10 years since the last crisis. no surprise that a lot of central banks are focused on financial stability and the risk that might have been created by keeping policies lose for so long. numberit is probably

three on the list of indicators that the fed watches to gain inflationary pressures. friday's report was better than expected. does this give us an indication of what this week's consumer price index could look like? kathleen: it is a good thing to think about it we look at is wholesalees, it prices, business to business prices, not in the same spotlight as consumer prices. they leapt higher in the month of october. let's take a look, i have this up on my bloomberg right now. here you go. prices rising the most in six-month spirit the monthly increase was 0.6%. it was supposed to rise 0.2%. granted, oil prices, gasoline prices rising up a good amount. even ask food and oil, they game was healthy to what is going on? a look at bloomberg economics and what are u.s. team was writing on friday. what they are looking at is seeing that there are bigger

margins between what people were having to pay for their inputs and selling for their outputs at the wholesale level, in services. services prices did not used to be part of the ppi. that is the part where we see the increase, a lot of the pressures is in services. labor market, services, i think it is very important for the consumer price index later this week is that services prices make more than half of the cpi. pressures are starting to show more there. that is where we can see lift in the cpi. haidi: kathleen, thank you so much for that. coming up, we will talk oil. longest losing streak on record. movingd friends are closer to supply cuts next year. saudi arabia is leading the charge despite oil prices are we will get more on that. this is bloomberg. ♪

haidi: shery: i'm haidi stroud-watts in sydney. i'm shery ahn in new york. you're watching "bloomberg daybreak: australia." let's check the business flash headlines. web pack says china bears are shorter on proxies such as the aussie and kiwi dollars as risks of central bank intervention grew large. the chinese currency is edging toward it's a decade low. they are more flexible, liquid and less affected. also say it is bearish on the aussie as the most liquid proxy for china risk. haidi: volkswagen and ford are said to be nearing a framework agreement to join forces on electric and self driving vehicles. --rces tell bloomberg they vw is poised to shery electric vehicle technology with ford piggybacking on to tens of billions of dollars of the german company.

chairman isand's teaming up with companies from asia and europe to bid for a $6.8 billion high-speed rail links connecting thailand to three international airports. it is one of the largest projects entire history -- in thai history. opec and its allies have been laying the groundwork to output when saudi arabia announced a reduction in crude shipments starting next month. is one of our regular commentators here. great to have you. i want to talk about that too cut -- set the context of the bracket -- of the backdrop of what we are seeing, the longest losing streak for crude. when you look at oil demand versus supply and what has been happening with prices, it is anprising because is

indication of the supplier side. even though they are -- there are concerns of what is going on in china and the demand side. jason: i think the biggest part of the story is the demand side. has happenedt what historically with oil prices over the last number of years, you see the oil prices tend to lag aluminum prices. and aluminum prices have been under pressure all year because china's manufacturing is slowing down and oil prices have also finally after the driving season , we have seen now, the full pressure is coming on oil. oil prices have just recently crossed below levels they had seen the last time china and heard a menu fracturing recession which was in december of 2014. i think that is where we need to be focused on. that is what i think opec is worried about. what happens to global demand? manufacturing has

been slowing down quickly and i think we are at risk in the near term of a chinese manufacturing recession where the recession goes below 50. get more blows this week when we get those industrial productions. jason, on the supplier side, saudi arabia is reasserting itself as a spring producer. announcing it will ship fewer shipments starting next month. does russia play bold? do they have any incentive to back down? jason: i think this is a really important difference between what is going on now and what happened at the end of 2014. at the end of 2014 when china slow down and dipped into a manufacturing recession which lasted a year and a half, the oil prices and they fell and fell and fell. now you have opec and non-opec members working together to contain supplied to prevent the

oil inventory buildup that you had which happened in 2015 in the -- in the early part of 2016. that happened because china's demand did not grow as much as expected. now you have opec and non-opec members watching this. the are really holding a tight. i think the yes, you will see non-opec members play ball because they have seen what happened when the demand side and not have any controlling input on the supply side. i think they will try to prevent the run-up in inventories you saw when china was last in a recession. this gtv library on the bloomberg is showing how the u.s. became the world's top oil producer in august. of course, we have continued production from saudi arabia and steadilyia, increasing. what are the chances that other countries, not only saudi arabia as you have indicated cutting production, but other countries will come to the table?

jason: i think there is a high chance. i think this will be a front-end members -- i will also be at the next opec meeting in december. this is actually going to be a critical concern, what happens with the u.s.-china trade war will determine what happens to oil prices. if we get a detente, prices will rise, demand will rise, manufacturing in china will pick up. if things continue on the path we have been on, there is more downside for all members. we know what chinese manufacturing does to oil prices. it clobbered them in 2015 and 2016. they are watching, and they will play ball. yvonne: last week we had -- shery: last week we had rumors of an opec breakup. we were hearing the saudis had a think tank. is this even possible at this point, and what would that mean for the oil market?

i don't put any stake in it happening. there is a lot of different strategic plans that entities have done from time to time, but the cooperation between opec and non-opec members in the last couple of years has been unprecedented. i don't see the group moving away from the importance of maintaining a unified front to the risk of a downside, downturn in demand. haidi: always appreciate your time. jason schenker, prestige economics president, joining us. ramy: first up, acting attorney general matt whitaker is indicating he will not cut the budget for the robert mueller investigation. it is a signal that fears on the inquiry will not happen in the perceivable future. he couldast year

imagine an attorney general reducing the budget so low that he is -- his investigation grinds to a halt. hot dry winds continue to drive the worst wildfires in california's history with jerry brown calling on president trump to release new federal aid. 25 people are known to have died and a quarter million have had to leave homes and seek safety. the governor's call comes a day after the president threatened to withhold funds because of what he called gross mismanagement of the forests. china's export-import last week was a success with $57 billion of deal signed. state enterprises in energy, autos dominated as president xi jinping promoted china at home and abroad. this is up the core of president trump's to satisfaction with beijing -- dissatisfaction with beijing. and a commercial mission

launched from new zealand and what will be a new era for affordable space flight. -- north island, carrying the rocket blasted off from the north island, carrying satellites. it has 3-d printed engines. global news 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am ramy inocencio. this is bloomberg. shery: thank you. this week on wall street kicking off with a fresh round of earnings, continued pressure on oil prices and questions about market direction. su keenan is here with more. we know the bond markets are closed on veterans day. su: earnings are likely to be a key driver, although we are entering the end of the latest earnings season. the direction of the market, whether it takes its cues from what cea's are saying, and we are finding earnings better than

expected, or whether headlines from the trump administration weigh on the market. bonds will be closed, but there whether the inflation risks remain or are overstated. it will focus on the cpi later in the week. the semiconductor index and nasdaq, the tech heavy indexes, down a big way. that will be a question as we head into this week. check out the earnings that are in focus. home depot, walmart, nvidia, tencent, bayer, a number of companies reporting. they will be testifying before congress, the vice chair, that will get attention. let's go into the bloomberg gtv. showns a chart we have several times but it is more important now we are after the midterm election. prior elections, 2018, 2014

volatility has come down. that was the case during part of last week. does it last this week? it is something many will be watching. haidi: we are watching oil as well. prices in focus. the word is saudi arabia, opec moving closer to oil cuts or laying the groundwork. su: we heard from jason schenker there is a concern by opec and its allies who decided to push a big decision to december to come up with a way to deal with the fact oil fell into a bear market in the last month. shery: thank you so much for that. let's get you some breaking news on the bloomberg now. private equity firm breach us capital and elliott management are close to a deal to acquire a athenahealth for $125 per share.

transaction could be finished monday. this will be identified as a athenahealth shares closed -- this could value the company at $4.9 billion. haidi: it has been sort of underexplored since june -- it has been sort of under exploration since june as the ceo has stepped down following accusations of misconduct. let's get more on what we are watching in asia with adam haigh. , u.s.st-midterm pop stocks under pressure again, tech, where do we go? adam: global equities in general. we had that rally off a brutal october. it has opened a can of worms for a lot of investors. although the midterms give you a divided congress that might ease

inflationary concerns and keeps the fed on a gradual hiking cycle, it is bullish across the board for equities. people wanted to add more risk incrementally. we saw in the u.s. equity market it was a tech driven selloff. growth versus value idea coming back, and value is turning to outperform significantly. we are still some way off, the fed value for the s&p 500. you can see the chart, but overall we are starting with a little bit kind of a dampening of risk appetite and sentiment. asian equities are looking to tort the week down reasonably muted. china is at the other end, continuing how the policymakers are adapting -- addressing the slowdown. the move was weak for faang

stocks and is reasonably significant. eak for stocks -- w bank stocks. shery: you can find his charts on the gtb library, gtv , on the bloomberg. it is a big week politically in the asia-pacific with back-to-back summits in singapore and papua new guinea. morrison's first on the global stage since he became prime minister. our to tell us more is managing editor for australia and new zealand. what is morrison's agenda? reporter: that is right, a busy week in the diplomatic calendar kicks off this week. we have the association of southeast asian nations gathering in singapore before -- action moves support

moves to papua new guinea. trading likely to be high on the agenda as the region tries to navigate its way through the u.s.-china trade dispute, and we have a wave of dignitaries coming, among the dignitaries, narendra modi, vladimir putin, .hinzo abe, china's premier lee eventswe absent at the is donald trump. he will be the first u.s. president not to attend since 2013. in his place will be the vice he isent mike pence, but raising questions about his commitment to the region. the u.s. pulled out of a major trade pact in the region, and allies are starting to question his commitment. .his is pertinent for australia the growing reality of china stepping up its diplomatic and

perhaps even military muscle in the south pacific region with a wave of infrastructure spending and concessional loans for countries like papua new guinea and fiji. haidi: this is our patch. will we see a more assertive person in the region? ed: he made his first keynote policy speech. we had the event at the bloomberg office in sydney two weeks ago. china wasabout how trying to change the balance of power in the region and pledged to make the south pacific australian policy the overwhelming one. it up with some new announcements, a $2 billion infrastructure fund to increase australian spending in the region, increased naval deployments and military exercises with these nationstates and all putting --

opening five diplomatic missions. it will be hard for australia to counter china's rise in the region. president xi will be holding a string of bilateral meetings with the island state leaders. prisons making president trump -- presence making president trump's no-show more apparent. haidi: australia struck between its key ally and the trading partner. ed johnson here in sydney. stay with bloomberg because later i will be speaking with the australian prime minister. that is at 1:20 p.m. sydney times. 20 past 10:00 in hong kong. shery: alibaba's annual shop gpon sets another -- shoppin holiday starts new records. this is bloomberg. ♪ ♪

haidi: i am haidi stroud-watts in sydney. shery: i am shery ahn. you are watching daybreak australia. alibaba rounded up $31 billion in sales in the singles' day extravaganza, setting a record as shoppers swarmed the online bazaar. numbers, and it is coming after 10 years of this event. they still hold off another record. what were the key takeaways? tom: another record, 27% increase from the number we saw in 2017. they racked up sales of $4.2 billion in 2017. $30 billion last night when this ended at midnight. some of the key lines we have been hearing from alibaba, they said around 500 million consumers took part in this consumer online consumer event.

they said in terms of the big-ticket brands, you had probably not a big surprise, apple phones, xiaomi phones, dyson vacuum cleaners. those were the top three on sale, purchased by consumers over the 24 hour timeframe. in terms of countries shipping goods to china, the top three nations included japan, south korea and the u.s. as well. we heard from the cofounder of alibaba last night before this whole event wraps up. he points to the changes from china's consumer group, talking about appliances that were less popular this year. cosmetics, more popular. he said potentially that was a case for the real estate sector slowing in the big goods becoming less popular for chinese consumers. and the share price is down almost 16% year to date, alibaba

stock, a reflection of people's pessimism about the chinese economy, saying it was stronger than people thought and alibaba was well-positioned to capitalize from a maturing consumer sector. they had online and off-line assets to leverage this whole event. there was also concerns about the environmental impact your one billion packages are expected to be delivered as a result of this shopping festival. alibaba set up 5000 recycling centers around china to deal with the environmental impact of this consumer festival. people were worried because we saw chinese online sales growth slowed you were there any other hints of the strength of the chinese consumer from these results? tom: looking at this, you would say it is a way of engineering a

spike in sales. potential you might see people holding off on purchases prior to this big event, buying through the 24 hours and then holding off another few months. some of the big-ticket items or less popular, linking that to the real estate sector. you saw a growth of 27%, in 2017.to 40% you are right to say online retail sales growth has been put ag, but alibaba has big focus on its expansion overseas as well as the online and off-line. a company based in singapore playing a big role making sure the numbers came in for another record for this company. tom mackenzie in shanghai for us. thank you. let's stay with single day. i want to bring in the head of research here. great to have you. you say, we have a decade of

strong numbers, each year stronger than the last, merchandise sales grew 27% amidst a difficult macro environment for china. are we reading too much into these numbers? are there too many variables? >> 20% percent -- 27% is impressive, based on the high 2017 that was 40% year-over-year as he mentioned. there is soft macro, but where we can get comfort from this number is chinese consumers are slowing, not collapsing. it is important to keep in mind the expectation right now after a few weeks of difficult lowered from october investors' expectations. so they were looking somewhere from 20% to 25% year-over-year

growth. the number this morning, 27%. that is clearly upbeat. that is just demand. let's look at supply. merchandisers are clearly being more aggressive in keeping up the promotions to keep the perhaps thatng, so is also why we are seeing a slightly higher than expected gdp growth this singles' day. but is the snapshot, and we will get a better idea of consumer appetite with retail sales later this week. in terms of how the company -- isurally highs performing, every single day we get another record, investors don't react the way you might expect. in terms of where the profits come from, we see strength across entertainment, cloud computing. in the future is this a company not so dominated by retail

components? junheng: i think if we are looking to the numbers a little bit deeper, $35 billion during this event, although it sounds massive, but based on china's 1.4 billion population, that is about $20 plus u.s. spending per capita. if you think double 11 is the equivalent of black friday ,oliday season shopping, u.s. average americans spend $900 u.s. per person on holiday. it is aonly about -- function, a very small number, $20 u.s. compared to $900 u.s. that is a piece of interesting information for investors. as chinese consumers grow, and hopefully they will, the sky is still a limit.

there is a lot of upside for china to grow its consumption. shery: alibaba's efforts to push into the u.s. market are sputtering. that pledge to create one million jobs in the u.s. seems to have evaporated. where will growth come from? i think china, alibaba is first and foremost a china retail story. china retail is still about 70% of total alibaba valuation. it tries to push into southeast asia, but that is still a small portion of its overall valuation. it tried to come to the u.s. with the infrastructure, the but it, technology, seems to be at a halt given the tensions between the two countries. given the numbers i mentioned, $20 u.s. only per capita spending during this huge

shopping holiday compared to what it could be if we only get u.s.ou know, 10% of christmas shopping season, $900 per capita spending, we still have three baggers. i think we can get more dollar value from china retail. jd.com reporting earnings on the 19th. how does alibaba compared to smaller rival? -- compare to smaller rivals? junheng: they have to smooth internal issues. of twoxistence drastically different and somewhat conflicting business model is what kept the growth the sexom and also scandal and the pending outcome is also causing some internal management issues.

not optimistic about distinctivedd has a is this model. it is unclear where there is going to be profitable amount, but the damage is done on existing e-commerce players. it is clear, taking shares from jd.com, alibaba to extend. shery: great to have you with us. from jd warren capital. this is bloomberg. ♪

i am haidi stroud-watts. shery: i am shery ahn. you are watching daybreak australia. -- one m b one mv saga continues. they now say the culture of secrecy at the bank led to the wrongdoing among client staff. this is part of his guilty plea which was revealed on friday.

ramy inocencio has the details. what stood out? ramy: the fact he admitted to conspiracy not just with agents for goldman sachs but also with his own fellow employees. not only that he admitted to lying about the role of one man who we have been talking about a lot, joe low. but the admission of conspiracy, he said he told the judge he took part in money-laundering, buybacks, and this was over two years. he admitted this was to get business from malaysian officials so goldman sachs would get one mdb's business. in a quote he said i conspired -- he is saying himself with other agents and employ use very much -- goldman sachs can conceal the facts. admittingout joe low

to lying there. he is the alleged mastermind behind the one mdb scandal. he is now hiding as a mouse. they cannot find him. he is trying to avoid charges in the u.s. and malaysia. tim leistner said he knew concealing joe low's involvement as an intermediary was contradictory to goldman's entire -- internal procedures. we go back to the conspiracy ring. this up, goldman sachs' spokesman didn't have any comments, but they did say they believed the proceeds of the sales underwrote work for development projects and they are saying leister himself withheld the information. we are -- they are trying to push the blame away. haidi: sounds like we will hear other employees outed as well. a reminder that later this morning i will be speaking with

the australian prime minister as he kicks off summit season with asean and apec. lots more to come from sherry and i on daybreak asia. this is bloomberg. ♪ a. this is bloomberg. ♪

haidi: very good morning. i am haidi strong -- haidi stroud-watts in sydney. shery: i am shery ahn in new york. welcome to daybreak asia. haidi: our top stories, oil is in the spotlight as producers signal curbs on output. saudi arabia reducing exports starting next month. 10 years after lehman brothers, u.s. banks are still falling short on risk management. alibaba delivers