emily: this is "bloomberg technology." president trump on the attack over gm's plans to cut jobs and factories in the u.s. threatening cuts for subsidies to electric cars and add new tariffs on car imports. plus, samsung's push from hardware to software and everywhere in between. the president ways in on the slowing global smartphone market. and, facebook under fire again.

by a former employee is going public with claims the company has a racism problem. first, to the top story. trump has been on the warpath over gm's plan to cut 14,000 jobs and shut down factories in theunited states floating idea of new tariffs saying the reason the business in the u.s. that tariffsto is of 25% had been put on cars coming into our country. gm would not be closing their plants in ohio, michigan, and maryland. get smart, congress. the president has great power on this issue because of the g.m. event and it is being studied now. he threatened to cut subsidies including those of electric vehicles. joining us to discuss all of this, bloomberg's bureau chief and celine morsi from l.a..

notd, what you make of this just the tax cut issue but the tariffs issue and the uncertainty. what is it mean for gm and other auto makers? david: trump was not clear when it said that she said he was bringing back the tax. if you would put the tax on cars wouldn't punish g.m.? only if you would agree to nafta. we have a differently named nafta but very much like the nafta we had. if you add tariffs, gm brings in the plant -- cars from the plant in mexico. but heuld hurt them would have to redo a trade deal he is already agreed to. it will not affect g.m. in that sense. he is using this for political capital to say we need bigger

tariffs on cars coming in from a variety of other countries because general motors just laid off a lot of people. that is a different issue. it would be more widespread tariffs on asian and european vehicles that he is been threatening for some time which would affect not american carmakers but foreign carmakers quite a bit because they import a lot of vehicles into the u.s. every year. emily: these tariffs on trucks date back to the 1960's when the u.s. retaliated against chicken tariffs in germany. just context there. what does this mean for the finance of electric cars and the impact on electric car sales in general? >> assuming he is referring to the federal 718 -- 7500 tax in the u.s., it would impact the industry. sales would likely decline

because this was a price incentive to these things. in the case of g.m., interestingly, they are hitting a threshold beyond which the tax credit phases out. should this tax credit be revealed -- repealed, one deeply impacted people would be competitors like ford and fiat chrysler who are way behind. as for tesla, we think they had the threshold which is a 200,000 cumulative ease -- tv sales. at markinghey hit th q3. for all of the bluster that trump is putting out there, it would not really impact g.m. or tesla. emily: trump is piling on to this tweet from tuesday or he says very disappointed with gm and their ceo for closing plants in ohio, michigan, maryland. nothing being closed in mexichem and china. the usaid general motors and

this is the thanks we get? we're looking at cutting all gm subsidies including electric cars. gm made a big bet on china when they built plans there. i'm here to protect america's workers. with tesla and nissan have been lobbying to extend some of these tax credits. where does that stand, david? that: there is a proposal would extend for another 10 years the tax credits and right now, it is being kicked around in congress. -- the republicans are really in favor of doing this so there's a lot of force trading going on. trump could really use political pressure to make sure that does not come back into the new budget and let the existing program phase out rather than re-up it.

cut gm subsidies, it is unclear how he would go after general motors and not punish other carmakers as well. tore is a proposal out there let that phaseout or veto it if congress would try to put it in the budget. emily: automakers are reacting to all of this, including the and lack of clarity on what the president means. take a look at this -- take a listen to this from the volkswagen ceo. >> even the conversation of tariffs and trade wars bring instability and unknowns. lack of stability and unknowns is not a good thing for business. we believe in free trade and fair trade. we believe in an open marketplace. 10,ake investments that are 12, 15 year cycles and you can have the chess pieces moving -- can't have the chess pieces

moving all the time. emily: one thing we can be sure of is that there is uncertainty --p into this equationedd capped into this equation. >> the global market is not hanging on every word a president trump. there are many other schemes that are pushing these into the market. we can think of the california state tax credits and other big markets like china and europe. as i said, if this federal tax credits were to be immediately repealed, it would impact a number of manufacturers. the nissans, fiats, ford's in the u.s. and sales could decline. most importantly, the bigger picture is that the fundamental technology driving these vehicles, batteries, and battery prices, are falling. years,next five to seven without any subsidies, these vehicles will be cost

competitive on an upfront basis engines.ustion it is important to put this into context. over the long-term, electrification does not rely on subsidies. in the short-term it would put a drag on sales in the u.s.. emily: what is it mean for tesla more specifically? being an electric car company building a factory in china. if you are talking about the tax credits, it does not mean much for them. the trade war is a bigger problem because tesla is exporting a lot of vehicles to china. they will build it -- they will build more there. it does not hurt them unless they intend to sell their chinese production to chinese buyers as opposed to bring them -- bringing them to the u.s.. that would be problematic if the trump administration is calling the shots on trade. salim,david welch and

much more to come as we head towards this meeting with president xi saturday. sticking with electric cars, two electric vehicles revealed this week. a pickup truck along a seven seater suv. after nine years of design, rivian plans to hire 1000 employees to manufacture the vehicles with production to start in 2020. the ceo joins lad -- brad stone to discuss. >> this is a lot of excitement. the manufacturers are looking at this and they are impressed with what the vehicles came with. because of that, part of our business be on trading is to likesome of the technology the battery system, cooling system, and apply these other applications with customers that [indiscernible]

brad: have you gotten any interesting m&a queries from conventional automobile manufacturers? that is not the objective of the company. the desire is the reason i built this company to reassure we could take technical problems and problems, things thought of as being a possible, and these innovations with a collaborative working environment to help solve them. at this point, we continue to remain focused on delivering those products. we're looking at opportunities to leverage it and utilize our technology. our focus remains on munching these products and we are close to that. for you.t question you said you guys have been at active for -- rivian

years. what is the hardest part in the debut of these two vehicles? >> the early years of putting the team together and getting this applies to come in and finding solutions for manufacturing. , this orchestra of activity, was a lot of time to get all of the pieces to the puzzle. we now have all of those pieces lined up so for us, it is an exciting time to show this because we are confident and be have those big items that do take a lot of time and effort and carry risk. brad: when can we buy a rivian vehicle? >> we have centers opened up -- opening up now and delivery starting at the second half of 2020. rivian ceo was the with redstone. trade tensions are escalating and impacting big retailers and e-commerce giants as well. from amazon to walmart.

we will talk about how. if you like bloomberg news, check us out on the radio. listen on the bloomberg app, bloomberg.com, and, in the u.s., sirius xm. this is bloomberg. ♪ this is bloomberg. ♪

cyber black friday and monday may have hit record sales but retailers are not off the hook. trade tensions between u.s. and --na are escalating some of escalating and some of the biggest retailers are caught in the crossfire. amazon and walmart have cut back purchases and orders for some of their private label ruddock's to get ahead a potential tariff

increases. while no details were given, one source told the journal amazon served the bulk of its electronics from china. trucere hoping a trade comes out of the meeting at the g20 summit later this week. here to discuss we have emma chandra and darren baker. what does this mean for amazon, walmart, target, and others when there is still so much uncertainty about what will happen? emma: you said it best. the big problem is uncertainty for all of the retailers. they do not know what will happen. tariffs are tweeted about by the president frequently. --think there will be between u.s. and china. the market often reacts and then things might get worse. i was reading a note from the head of political analysis at ever court and he said he is putting it 95% chance this

meeting between president trump and president xi is just going to be a grip and grin. we are not in the see any resolution. that is exactly what retailers do not want. they want to see some resolution. the report in the wall street journal says they are trying to cover their bases ahead of this possible increase in tariffs in january. they're are stalling to look at their supply chains. i have been speaking to a number of ceos from retails and they say the uncertainty is making things difficult they are looking at their supply chains and where they can make changes and change suppliers. it is not easy. supply chains are complex. not something they could do without. emily: as emma said, it is the uncertainty that is the one thing likely to continue. had you expect us to the bottom line of e-commerce? darren: i think it is an interesting story and there are a couple of storylines.

amazon, for all of its e-commerce dominance, still 60% of their sales come from third -- third-party sellers. emily: which means? darren: that means the sellers have interesting decisions to make. if i may 3-party seller on amazon and my cost of my product is 10% higher, do i raise the cost of the product, eat it in the margin, stop spending less on advertising? i think that is uncertainty that is interesting. emily: emma, walk us through this in the context of holiday sales happening now, deals happening now. trying to get all of this merchandise to customers on time. a holidayave had shopping weekend from thanksgiving through cyber monday draw millions of people shopping online. we saw something like $8 billion spent online for cyber monday. a lot of people say it was a great weekend and there was a

positive forecast for the whole from november through december and expected to see sales growth of 5%. weekend, oneliday of the things that came out of the report is a focus on inventory. a number of retailers are bulking up inventories in the way we see to a much higher degree. target inventories are at an all-time high. demand,that is seasonal but that is them preparing for january hoping to get a lot of products over in the states ready to be able to deal with any -- so that they don't have to pass on increases in prices through january. emily: these sales really are driven by price and price wars are in full swing. how does this uncertainty impact price wars? deren: you have to look at a

category by category. there are private labeled categories like amazon basics products. they have been less dominant in categories like women's apparel is a more decided purchase. if they are able to whether some of the storm because of the diversified stream and say i will go after the women's apparel category and cut prices on h&m and the other companies that have a much less diversified revenue stream, there is an opportunity for amazon. emily: do you expect certain categories to be impacted more than others and if so, which? deren: i think the luxury purchases will be less impacted. spend $1000lling to on an iphone, you are willing to spend $1100 -- emily: even if there are tariffs. deren: right. there are other categories like low-price women's apparel which amazon has not made good on.

amazon walmart are not doing quite as well as wait there. -- wayfarer. the giants have this as an opportunity to grow sales over time. baker and right deren emma tron drug -- emma chandra, thank you. salesforce impressed wall street with a strong third-quarter beat. we will take a look at what is next in the cloud. this is bloomberg. ♪ loomberg. ♪

emily: salesforce shares jumped the most in two years after they reported stronger third quarter results than expected. revenues jumped 26% from the year-earlier driven by an expansion in the service and sales cloud segments. earnings came in far ahead of the average estimate while billings grew 27%.

joining us to discuss is bloomberg intelligence analyst mandy. >> it goes to show this the company that has really scored big in cloud and continue to show remarkable consistency when it comes to growth rates. 20% plus all of the time. enterprise spending is going toward cloud so companies like amazon on the infrastructure side and the salesforce on the application side are the real winners. they will continue to do well. emily: what is a mean for the tech sector to see this success here given this can be an indicator for other similar emily: do these acquisitions

stand the test of time? >> cloud is such a predictable model that, especially legacy companies, if you look at somebody like oracle, they would love to acquire a large cloud company. i think they will be willing to pay these high multiples, just because you can buy predictable growth, which is very hard to get on the consumer tech side or any other hardware semiconductor segment. software cloud is the attractive will, predictable segment -- is the attractive, predictable segment. emily: what are the companies

you are watching that could be in play? ap we think small-cap to mid-c companies in cloud, like box, these are names that are single product, that have not scored big, like ones that i mentioned. they could be in play here. emily: bloomberg's mandeep singh for us in new york. it could be an exciting year in m&a. up next, at a time when facebook is in the spotlight for leadership issues and much more, a former employee is calling the social network out for racial inequality. we will speak to the employee, next. this is bloomberg. ♪ ♪ there's no place like home ♪

argh! i'm trying... ♪ yippiekiyay. ♪ mom. ♪

emily: this is "bloomberg technology." i'm emily chang in san francisco. facebook is battling criticism on all fronts, now from an ex-worker who says the company has a racism problem. a former employee wrote a lengthy internal memo explaining how difficult it was to be black and employed at the social network. in the memo, he wrote, "facebook's disenfranchisement of black people on the platform nears the marginalization of its employees. racial discrimination at facebook israel." he says he expected -- at facebook is real." he says he expected some change. instead, he got a message saying

his experience may not be representative. mark luckie joins us now exclusively from atlanta to discuss. describe what it's like to be black at facebook. mark: to be black at facebook is really finding your community, because you don't see a lot of people who look like you. the majority of facebook's population is white and asian. when you see other black employees, you look to them for support. that's where a lot of conversations that were the start of this post came from. emily: you write in the memo that not only did you feel marginalized, that you had walked by employees and two or three times a day employees would look at you, tap, and shove their hands into their pockets. why did you decide to go public with these feelings? mark: because there are so many employees who are going through the same thing. prior to the post, going internal, i would have a conversation with an employee, a black employee every single week

at least would say, you know, i'm going through this or i'm having a tough time with diversity on my team or i'm being called hostile, things like that. even if every black employee didn't experience everything listed in the post, chances are they experienced at least a little bit of it. it was tough to walk through the facebook campus and know that this is a company that promotes inclusion and diversity, but that not being reflected in my day-to-day experiences there. emily: facebook executives, including mark zuckerberg and sheryl sandberg, have had a lot to say about some of the other criticisms they have been getting recently about this delay, deny, deflect with respect to russian election meddling, leadership issues, and more. did they say anything to you about this? mark: they did not. that is really uncharacteristic of the company. usually for something that is this conversational inside the company, there is some comment from mark or sheryl or somebody from that team to say, ok, we are thinking about it.

a lot of black employees felt even more marginalized because they didn't get the same treatment or the same conversation that other issues may have received. emily: you did get a response from one of the highest-ranking black employees at facebook, who said to you, i guess i'm just confused and pretty hurt, because i voted for your hire, was inspired by your willingness to strengthen the community, and that post just seemed so out of character. haveater tweeted that many diverse experiences, diverse perspectives, but that your experience may not represent the experience of others. what do you make of that response? mark: it's interesting. about a week before i handed in my resignation, one of the employees told me the only black employee who can be there authentic self is ime. i think there is a disparity between the people who are close to mark and his team and the employees who are on the ground level. i think it's disingenuous to say that this is just my experience or that i'm out there just putting out all kinds of

information about the company that isn't true. disappointed in the company is why i wanted to put this out. i didn't want to be another black employee who left the company and didn't say anything. the day i put a post up internally, i had three different people, to me and say i handed in my resignation for the same reason. i'm doing it for them and for all these people. emily: facebook did respond. we got this from a spokesperson. "we have been working diligently to -- working in many different functions across the company is a key driver of our ability to succeed." importantly, you point out in your memo this is not just about employees' experience at facebook. you believe this extends to the expense of black users on facebook. how so -- the experience of

black users on facebook. how so? mark: because most of the people who work at the company are white and asian, they don't think of the black experience, which is a shame because black users are over performing on the platform. it's a missed opportunity, a missed financial opportunity for facebook to not engage with those users in a meaningful way and also to make their experience on the platform much more difficult through all the ways it is taking action and inaction. emily: this had me recall the incident back in 2016 where there were black lives matter slogans written on a wall at facebook. employees had crossed that out and written all lives matter. mark zuckerberg did condemn that. you also worked at twitter. i'm curious how your experience at facebook compared to your experience at twitter and whether it is more deep-seated than perhaps zuckerberg realizes. mark: the great thing about facebook is that there are

posters all through every one of its offices, particularly in its headquarters, many of which proclaim black lives matter. black lives matter matter, but you are not seeing -- black lives may matter, but you are not seeing black lives as frequently inside of facebook headquarters. twitter really made a lot of changes in the last couple of years, a lot of improvements. their black employee resource group is active and engaging with the community. someone internally asked me, do you think this problem just happens at facebook. of course, no. it facebook to proclaim that is connecting communities and really supporting these groups, what happens after they get hired? you have to think about being inclusive, and not just hiring black employees. emily: what's your response to the general leadership issues, both sucker brick and sandberg under fire for how they have handled -- both zuckerberg and sandberg under fire for how they have handled this russian situation? do you think they should still be leading this company?

mark: i think that's up to other people to decide. the leaders inside of tech are thinking the best possible use cases for their technology. they are not thinking about the worst. that's where you see issues like the russian hacking, the fake news issues, this issue about the black people on this platform. it would behoove tech companies not just facebook -- tech companies, not just facebook, but to think about how will this get in the hands of the wrong people and how can we curve that the four it gets to market -- curb that before it gets to market? emily: you are done with silicon valley for good. is that correct? mark: that is correct, unfortunately. emily: why? can an employee like you help silicon valley change? well, i tried to effect as much change as possible. andd a great run at twitter

ultimately moved on because there was more that i could do, and the company would not have been a great place to do that. facebook, i was very determined to stay there as long as possible, and i was going through issues with living in a mostly white neighborhood. i was going through issues with having my work curbed at every level. so, i said to myself, i can't give up my social life, my personal life, my health, and my security, to work for a company that is not supporting me and also not supporting a lot of people who work in diversity. they hire a lot of these people, but their efforts are being curtailed left and right. emily: black people are sorely underrepresented at facebook, in addition to latinos and women, despite sheryl sandberg's leadership. what do you think facebook needs to do about this? mark: i think facebook needs to think beyond the pipeline and think about non-technical roles. that doesn't get talked about a lot. there are a lot of engineers who

work inside of facebook, but there are many more roles across the company that have everything to do from vr to building internet in third world countries. and you are still not seeing the diversity on those teams. thankfully, i worked in partnerships, which has a significant number of black people, but they are still few and far between. i would like them to go beyond the people that they know, the people that they have worked with previously, who are more likely to get in the door, and to engage and see who else is out there that we may not be thinking of because we don't have personal relationships with them. emily: all right, former facebook employee, mark luckie, joining us from his new home in atlanta. thanks for sharing your story with us. oming up, we had to -- head to bloomberg's conference. we will talk about the slowing global smartphone market. plus, they have been at the top of the chipmaking world for decades, but are they about to lose their crown? that's ahead.

this is bloomberg. ♪ s is bloomberg. ♪

emily: we talked about the racial claims against facebook earlier. now one company is trying to reshape the workplace in order to avoid these kinds of issues. ibm is launching ibm's talent and transformation, a new ai-fueld talent business -- ai-fueled talent business. for more, we are joined by ibm's talent managing director. how exactly does this technology work? >> we are really excited about this new business. you know, as technology is continuing to advance, about 120 million workers at least are going to need to be reskilled in the next few years. this is a really important board room topic for most companies.

our new business is being launched in order to help those companies deal with that in two different ways. one way is to help them with reskilling their workforce on a continuous basis, as well as helping them change the way they are working for their employees. the second way is to help them reinvent their hr function, so that can be the catalyst for that change. emily: how could this avoid a situation like the one facebook finds itself in now? oyeeust spoke to an ex-empl who says this company has a racism problem and went public with it. amy: the fact of the matter is that ai can help with many decisions in the workplace, but the people that make the decisions -- it is the people that train ai. our belief that ibm is if we educate our employees in how to use ai, how it helps them in their jobs, they are the ones that ultimately are going to be able to impact our ways of working and make a real positive difference for bias in the workplace. emily: you are absolutely right.

it is about the people who are building the ai. this is an industry that is dominated by men. ibm doesn't release a diversity report, but it is well-known that the tech industry in general has a gender problem, has a race problem. isn't it profitable -- possible that ai could not just, not necessarily reduce bias, but re-enshrine bias that already exists in the algorithms? amy: the ai algorithms are trained by people, so it is just -- just like without technology people can have bias. technology can help this bias in a very dramatic way, if it is trained in the right way. that's why it is so important that companies adopt us, as many have, a belief system on how important diversity is, like ibm has for over 100 years, and that they train their people in the right ways to use technology, so that can help educate the workforce and help educate

decision-makers to not use by us in decision-making -- use bias in decision-making. emily: reuters published a shocking story about an amazon recruiting tool that trained itself to reject the resumes of female candidates. it simply learned that male candidates were better because so many men got hired. how do you make sure that doesn't get built into your system as you are developing this product? amy: we actually have several products that assist in the recruitment area. avoiding bias is a big part of what they do. in today's world, the entire function of recruitment has pretty dramatically changed. now that employees, instead of looking for a specific job, a candidate looking for a specific job, they can upload their resume and our products, our watson candidate assist product can look at their resume and look at their skills and identify what rules they would be -- roles they would be skilled at doing.

it opens up a whole new set of capabilities and roles that an individual would be qualified to a totally which is opposite perspective than the situation you are referencing, because it opens up a whole new world of qualification for people that perhaps, they didn't even know they were ready to take on those new adventures. emily: how much do you think this new product will impact ibm's talent business? do you think this will be a big revenue generator? emily: our business is not about a single product. our business is about helping corporations shift their model so that they can have a competitive differentiator with talent moving forward in the future. emily: amy wright, thank you so much for joining us. year aheadberg's summit is underway in new york, bringing together ceo's to tackle every topic from brexit to trade talks and the future of technology.

selina wang sat down with david to talk about the coming year for the tech giant. she started by asking about its transition from a hardware company to a software company. >> there are these designations we all used to label companies hardware companies or software companies. i believe that in the future we won't use these designations because companies will just be successful or not and products will just work or not. the most successful products will most likely have what i call a thoughtful integration with hardware and software. if youllenge is, though, think about hardware or media even, when you launch a product, when you bring it out to the marketplace, it has to be perfect. once you sell that tv in the store, once that tv show is on air, you can't really change it. but of course the opposite is true with software. to that most mot software companies live by is to launch early and iterate. you use your consumers to

provide you with feedback. the challenge for companies on either side, if you come from a hardware background, is understanding how you can be more agile and use your customers for feedback to create products and experiences that work and then on the software side, you may launch and you can iterate, but you have to cross certain thresholds of quality so that it works for people. this is why companies from both sides have not always been able to work together effectively. it is improving now. what we're trying to do is, within this hardware company, bring in people who have the software and services expertise to enjoy -- inject that dna into the bloodstream so we can have the best of both. selina: the smart phone market has been slowing. officer,innovation how are you looking at the smartphone business in the future for samsung? what is your plan to reinvigorate growth and

innovation there? david: one of the things about samsung is that, while we have a very successful mobile business tv's as -- tube we sell in any given year 500 million displays of one form or another. us, that is aor huge opportunity to connect these devices so that they can create complementary experiences. as we think about things like iot and connected homes, as we think about the proliferation of ai, with think about these displays as touch points where we can gather information and then provide experiences that are chained together. so, for example, many people the -- for many people, biggest investment they will ever make is in their home. yet when you leave your home, you have no idea what's going on, you have no relationship or ability to communicate with it

as an entity. so, what we are seeing now is not just our company, but other companies giving consumers the ability to have a relationship and a dialogue with their home. and this is supported and will be sort of fortified by having cameras and sensors and everything from climate control and energy to lighting all connected. so, when you talk about a specific device like a smartphone or a tv, they can't just been seen as standalone devices, but seen as one of a portfolio of things that can give consumers a better experience. when i'm away from my home, i might be able to send a message to my family, and it shows up on the display in our refrigerator. or when i walk in front of my tv, the photos that i took over things giving break -- thanks giving break, can easily be shown on my tv or someone's tv

that i care to share with. as we think about the future of our businesses, it is not just a pure hardware business, but we think about how we can create great experiences, which is what i call the thoughtful integration of hardware and software. samsunghow is navigating the current trade tensions between the u.s. and china, and is that impacting your strategy at all? david: i'm not in the hardware business. whilelief is that, silicon valley is fantastic as a source of innovation, for me, it's more of a mentality. it's a way of thinking. innovation can be found everywhere. we have set up offices and we have done deals all over the globe. we will continue to do that. we want to be wherever the entrepreneurs are. emily: samsung next president david eun. dominanced, intel's

in chipmaking is being challenged by taiwan semi. we will have the details next. this is bloomberg. ♪

emily: for more than 30 years intel has been the dominant force in chipmaking, producing the most important call -- component in the bulk of the world's computers. that is under threat by a company helping others shed the industry's reliance on intel's chips. taiwan semiconductor is the third biggest chipmaker in the world, though not necessarily a household name. why does intel have to be worried? >> production technology is important in the chip industry in the way that it isn't in other industries. you are not just making things more cheaply. you are not just making things more efficiently. it actually contributes to making the products better. intel dominates in computers. it makes a lot of money for making chips for computers. semiconductor's work

is better, it could make a lot of money. emily: its customers include apple. how dominant is taiwan. semi? >> if you have a smart phone, chances are the main component in that smartphone was made in one of their factories. emily: intel lost that battle long ago, didn't they? >> they have a different type of chip in apple, but the main microprocessor, the guts of the sc.one is made by tp emily: we talk about intel's dominance being challenged. do you see them on the brink? >> it's hard to say. they have faced many challenges. they have always been on the brink, and they always seem to find a way, but we have never seen them take multiple years to sort out a problem like this. emily: they have taken several months now to find their new ceo.

what's the progress on that? >> we don't know. we have done a lot of reporting on this. as you pointed out, it has taken perhaps longer than some would have hoped. emily: if you could put money on it -- i know you are a journalist, so you can't. what do you wager the chip industry looks like in five years? ian: everybody has been writing intel off for so long now. intel has always found a way. the intelligent analysis i have been given says intel perhaps isn't as dominant, but it finds other ways to grow. emily: ian king, good to have you here. talk to you again in five years and a lot in between. that does it for this edition of "bloomberg technology." you can check us out @technology . follow us. this is bloomberg. ♪

>> a very good morning. i'm haidi stroud-watts in sydney where australian markets have just opened for trade. >> good evening from bloomberg world headquarters in new york. i'm ramy inocencio. sophie: and i'm sophie kamaruddin. welcome to "daybreak: asia." haidi: our top stories this thursday, the rally looks set to extend for asia after u.s. equities surged the most since march. the s&p 500 jumping more than 2%. jay powell's comments fueling

speculation that a rate hike pause is closer than we thought. china says global trade is at a crossroads and the world must choose. they are warning growth is slowing faster than expected. ramy: let's get a quick reminder of how u.s. stocks ended the session. they did en in the greend, all rising the most in eight months. as we are looking at s&p futures, it is down by nearly 0.2%. as you mentioned just now, the biggest catalyst for this was the words of jay powell, saying that the interest rate was just below neutral and that let the doves fly. we saw investors pile in. if interest rates stay a little bit muted, more money can be channeled into equities and take a little of the edge off. sophie, i will hand it over to you.

we are seeing a little green over where you are, too. sophie: we have shares gaining about 0.3%. tech and materials helping lead that. energy stocks are under pressure given that oil prices have tracked further into their market territory, with oil traders looking past the fed to the of tech in u.s. inventory. the aussie dollar is retracing some of its overnight pop on the back of powell's dovish tone. we are waiting on private capital spending data from australia, expecting a slight uptick. in new zealand, we are waiting of business sentiment, which has not been a tailwind for the economy. we could see a pop of over 1% for the kospi and investors there on the u.k.'s lightly rate hike on friday. asian investors certainly look ready to join this rally.

a sustainable rally -- recovery ultimately hinges on how the trump-xi meeting plays out. taking aim at chinese tariffs on u.s. autos. we had caution over global growth, potentially adding to concerns. the imf says the economy faces more downside risk than a year ago, due in part to the sales tax as well as trade tensions. ramy: i'm wondering how long this dovish rally can last. sophie kamaruddin, thank you very much. let's do a closer look at the u.s. stock rally. it was the biggest in eight months as jay powell fueled bets the central bank is closer to hitting a positive on rate hikes. su keenan is here with more. su: it led the rebound. stocks heavy in software, the

tech stocks. let's take a look at the dow itself, which came slamming back. middle of the chart. right after midday when fed chair powell, began to speak. a rush of several hundred points higher, a gain of 600 plus by the close. let's go into this snapshot. the dollar was weaker. gold, actually, trading down after hours now. oil fell to almost a $50 mark -- the $50 mark. it is taking back up after hours -- ticking back up after hours. the size of the moves is notable here. wayfair, an internet sales company, had a big jump on positive earnings. amazon just blasted higher. square and many of the fintech, paypal, banks were also higher. caterpillar pacing gains for the industrial group. if we go into the bloomberg,

right ahead of the fed chair comments, the dollar trading near records. you could see that reflected by the fact that bulls have been holding their strongest long positions in some time. ramy: tech was a big part of the ack, wasack -- bounceb it renewed confidence from the bulls? su: traders i spoke to said it would likely be a mix and that you did have that strong performance by salesforce.com boosting the software and related stocks in that cloud space. if we go in to the bloomberg one more time, reaching for the stars is what this chart is called. salesforce cloud revenues continued to rise, so that area of technology, a strong spot for tech. thanks stocks, all showing sizable -- bank stocks, all showing sizable gains, even though some have been lower earlier in the session. haidi: home sales plunging in october. that underscores the rate pause picture.

su: it was rising mortgage rates and rising costs of homes that really caused this gauge of home sales, new home sales to fall more than expected. on pace for the slowest since 2016. check out how the homebuilders performed. powell'sd chair speech, they were down by almost an equal amount across the boards. this flipped it for them. lingering concern of what higher interest rates are doing for this area of the economy remain. haidi: su keenan there in new york. let's get you "first word news." >> prime minister theresa may is being warned a no deal disorderly brexit could cut commercial property prices in half. the bank of new england says crashing out of the eu without an agreement could cause worse problems than a financial crisis. governor mark carney says the bank has plans for all partial -- possible scenarios, but warns

the u.k. faces the steepest economic slump since at least world war ii. >> evidence from surveys and other u.k. authorities suggests that the country is not yet fully prepared for a cliff-edge brexit. thanys suggest that less half of businesses have initiated contingency plans for no deal and less than 1/5 of small businesses have done so. >> the dollar tumbled after fed chairman jay powell said interest rates are just below the so-called neutral range, leaving traders to ratchet back expectations for the number of hikes next year. between december 2018 and a sever 2019, euro-dollar -- and december 2019, the euro-dollar fell. lownterest rates are still by historical standards, and they remain just below the range of estimates for that level that would be neutral for the economy. that is neither speeding up, nor slowing down growth.

>> president xi jinping says the global economy is at a crossroads as he prepares to meet his american counterpart this weekend. speaking in madrid, he said the world must decide whether to continue supporting the global system, because failure to do so will lead to new barriers on trade. xi will meet with president trump in buenos aires. washington indicating higher tariffs on chinese goods in the new year. lion air is rejecting a report that the plane that crashed into the java sea was not fit to fly. it says it was airworthy. report into the crash says a faulty sensor wasn't checked, even though pilots had warned of the danger. no one on board survived the crash on october 29. global news, 24 hours a day on air and @tic-toc on twitter, powered by more than 2700 journalists and analysts in more

than 120 countries. this is bloomberg. haidi: thank you. still ahead, fed chair jay powell dialing back expectations for rate hikes next year. we will ask why the fed is taking such a dovish turn. ramy: up next, will we see a trade truce at the g20 this week? we will see what's happening on the ground in buenos aires. this is bloomberg. ♪

welcome back. this is "daybreak: asia." i'm ramy inocencio in new york. haidi: i'm haidi stroud-watts in sydney. world leaders are arriving in argentina for the g20 summit with investors watching the discussions on trade, migration, and climate change. minister about the host country's role in finding consensus.

[no audio] >> the hosts of the g20 is not to strike a deal between the leaders, but to act as an honest broker of the different positions. haidi: erik joins us now from buenos aires. great to have you here with us. a lot is at stake if this trump- xi dinner date fails to deliver. erik: sure, a lot is at stake for the global economy. the region argentina is so determined to be this honest broker is because there is so much at stake for this country, as there is for other emerging markets. argentina, as you know, finances most of its debt requirements outside the company -- country i n dollars. it has been subject to some of the emerging markets he currency

ets currencyark attacks we have seen earlier this year. argentina is desperately trying to return to the global economy as a major exporter principally of, commodities, but eventually of other things. of globalbe -- doors trade close further than they already have, that imperils the economic recovery of argentina and probably imperils the future prosperity of many other emerging markets. ramy: erik, as we approach the meeting, we are hearing a lot of chatter from within the trump camp on the state of the u.s.-china relationship. break this down for us. it's hard to know exactly who is whispering in the president's ear and what he is taking away from it. example, weand, for had larry kudlow the other day saying there had been very little progress on the trade front between the chinese and the americans.

he was hopeful for something of a breakthrough at the dinner that trump and president xi are having this weekend here in buenos aires. on the other hand, our colleague in washington spoke to another , who told andrew have in fact, trump and xi forged a very strong relationship. that's a direct quote. and that he expected the cooperation to continue and to improve over the course of this weekend. to take awaything from that is that he may not have been referring specifically to trade. he's more concerned about the way that the chinese and the united states cooperate on things like isolating north korea. getting two, in different takes from two different sides of the trump camp on the nature of the relationship at the moment between china and the u.s. and more specifically, between president trump and president xi -- of course, they are sitting down

for that dinner on saturday night. if they are able to come to some kind of a framework understanding, let's call it, on trade, then maybe the united states won't go ahead with trump's threat of imposing 25% tariffs on an additional two under six e $7 billion of $267se goods -- additional billion of chinese goods as well. ramy: joining us now is the cofounder and partner and a former deputy u.s. trade representative. from our own erik schatzker talking about what we might expect and hope for out of , whati-trump meeting would be some kind of success that we might keep within our level of expectation? >> thank you for having me. i think success and the so-called deal would be three things. parametershe basic

u.s. on trade are china and the for u.s. on trade are there. two, who is speaking for the president? that's very unclear. at times, it has been peter navarro putting himself forward. the famous china hawk. other times, it seems like treasury secretary mnuchin or larry kudlow are speaking for the administration. we need some clarity on who is doing that. if we can get both those things, hopefully there will be a backing off on the new tariffs or at least no further tariffs imposed. ramy: robert, let me bring you in here. if china and the u.s. were to designate a couple folks to speak on behalf of xi jinping and donald trump, who would you

like them to be? >> ultimately, we have learned that this relationship -- it has to be president trump and president xi jinping. they won't be negotiating tariff law. for this administration of the u.s., it is clear there is one person who is ultimately able to do it. traditionally, trade issues have been dealt with by the united states trade representative. the ambassador, who is part of the white house, is an ideal person to do that. i think the key, though, is, is there enough parameters around the type of changes that fundamentally need to be made in china for us to move forward? i think we will see a precursor to that in the broader g20 discussions about the future of trade, the future of the wto. that's the effort the global community can help set the stage for a more productive one-on-one discussion between the u.s. and china.

haidi: i think that's the crux of it. what counts as a deliverable? we know president trump likes deliverables. he wants things that can be wrapped up as a win. but some of the things that the u.s. has demanded, structural economic change in china, essentially, are pretty massive changes to the made in 2025 ambitions. we know they are probably nonnegotiable or non-deliverable in terms of being able to happen in the short-term, right? >> that's absolutely correct. the best deliverable we can hope for for the bilateral is an agreement in principle about in the engagement in the coming months to determine if they can bridge the difference. but before we get to that, we have a fundamental question. can the g20 as a whole develop a common statement around trade and the future of the wto? that also is critical. , the asia-pacific

economic cooperation forum, that there was not an agreement for the first time in the 29-year history. the g20 has an essential role to play to say that there is a future for the world trade organization and that needs to include looking at the things in the wto that work like innovation, protection of intellectual property. we need that strong reaffirmation of the system to set the stage for the longer term discussions between the united states and china and other countries. as these longer term discussions may or may not happen, i think we have agreed that the best case scenario is that we get a framework for more discussions to come. the imf is warning the world economy may already be slowing more than what we know. is there already damage being done and that will continue to be done in terms of loss of investment confidence by companies, in terms of a

diversion and chaos when it comes to supply chain? all of that goes on while the u.s. and china continue to have these on and off conversations about trade. >> there is absolutely damage being done. you saw general motors shutter some plans this week -- plants this week. that may have had a little bit to do with how much more expensive it is to get steel and aluminum because of the tariffs and the retaliation on the tariffs. when i talk to business leaders across the united states, whether it is semiconductors to soybeans, they are worried. i've never seen business leaders so united in wanting to resolve the problems between china and the u.s. on trade and get back to business as normal. having said that, i would add that the unfair trade practices that china has been practicing for many years now are real. i don't think it is too much to theft ofop this cyber

intellectual property both in -- the chinese stealing from the u.s. and european and other companies. it is not too much to ask to do reasonable opening of their markets and let foreign firms .ompete in an appropriate way those are all the things that really need to be on the table. this is not really, when you get down to it, about trade deficits , although the president often says that. it is really about fair market access. if we have a united front to touring the u.s., europe, japan, australia, we can hopefully get china to see some reason. ramy: i have to say that with the current administration, they are not one to reach out and work with other folks around the world. more to your point about imports and exports, hop into the bloomberg terminal with me. i want to get us up to speed with where we are with the tariffs. the red line would be tariffs

across all of the u.s. imports from china. in terms of the hurt for the u.s., as well as china, for the gdp, we know that china is not doing well. the u.s. also set to slow down. how much growth could we see if this affected all the imports? >> there are various studies on this. one i saw out just yesterday that i think is funded by a conservative in the united states says, if all of these tariffs are implemented, all the ones we are currently discussing, you would hav ea -- have a loss of $360 billion or more of gdp in the united states next year and something similar or even higher in china. and the rest of the world actually does a little bit better because they gain from the fact that these two giants are warring. our soybean farmers in the u.s. are hurting. soybean prices are down by 20%. the brazilians are laughing all

the way to the bank, because the chinese are buying from them. haidi: robert, i'm just wondering, having been in the position of deputy us -- how much is this based on economic grievances that exist? how much do you think it is being informed by over tours of -- overtures of an ideological battle with beijing? >> i think it is largely being driven by actual problems that exist. there is a long history in the united states having challenges related to china. those challenges are unfortunately never unique to the united states, but it is how the united states has approached those, whether they were issues around property projection in the george w. bush administration, the prospects during the clinton administration of brain china into the wto with the hopes they would become a market economy -- of bring in china into the wto with the hopes they would become

a market economy. one of the important things in this is that the u.s. is leading and the u.s. is probably paying the price for the leadership to try to make these changes. everything that the u.s. has identified as a problem with china having a restrictive economy, it's lack of respect for intellectual property -- that applies to every other country in the world. that's why the solution will never be one that is solely struck by the u.s. and china. it has to also figure out how ede wto is modernized, reform to deal with a large economies like china that is a nonmarket drive-in -- nonmarket driven economy, how it increases transparency around the rules-based system, and how it addresses some of the shortcomings of the appellate body. we have to instill greater

confidence that there is a global mechanism to deal with it. the u.s. is the pointy end of the spear. this has to be resolved between the u.s. and china, but it has to be a resolution that works well for the u.s. and all of its trade partners. this is really an interesting game, interesting play. it is two leaders, but they are effectively proxies for a larger global challenge that is playing out in the g20. haidi: thank you so much for that. great to have you both in the conversation. lots more to come here on "daybreak: asia." this is bloomberg. ♪

>> you are watching daybreak asia. take a look at trading in

australia where we are seeing the s&p trading. it taking some of the strongly from wall street overnight. take a look at the catalyst of this. the tower of power, u.s. stocks surging the most since march. ♪

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"all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast. have been trading for about 30 minutes. ae upside about 1%, taking strong lead from wall street overnight where stocks rallied after jay powell says remarks that he is considering a positive interest rates. dovish and we see a bit of repricing. : 6:30 p.m. in new york and s&p futures are looking pretty much flat right now as we head that gangbusters rally today across the market. mostow and s&p rising the

in 18 months. other them rising more than 2% on the powell dovish remark that cannot earlier today. i'm ramy inocencio in new york. and i'm in sydney, you're watching daybreak asia. >> the imf says global growth may be slowing more than forecast two months ago and is urging countries to pull back some damaging trade war. the forecast in october and new data suggesting more. it hasgarde says tightened an emerging market, trade tensions continuing to rise and significant risks are material rising -- materializing. president trump raising tariffs on imported vehicles. he tweeted that the reason the small truck businesses ago two favorite is that tariffs of 25%

had been put on small tracts coming into the country. they said that they would be cutting -- would not be closing factories and cutting jobs. for the first time since the drama began, 10 days after his arrest, executives say they remain committed to the tie up. it but reports from japan say that they want the relationship reviewed. the meeting will happen in amsterdam was japanese executives joining by video call. >> the focus right now is business as usual. the alliance of attack and direction from the mothership in japan, we are giving direction to employees to stay focused on the business at hand. >> tesla says owners have racked up a billion miles using a cars autopilot system since the

feature was first installed in october of 2014. autopilot is designed for use on highways and tesla uses collected data to improve the software. elon musk has promised to demonstrate fully anonymous driving on a road trip from las vegas to new york, although it is not clear when that might happen. 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'm jenna dagenhart. ramy: let's check in on aussie markets right now. sophie is on that. gains: in sydney, we see of about .9% for the benchmark led higher by material and tech shares. we see the i.t. index gained 2.4% and we have whitehaven: leading gains after being upgraded to hold. sinking as regulated flag competition concerns over the company's purchase.

check in on the aussie dollar that change the most in four weeks on the jay powell dovish tone. trading attend a high ahead of third-quarter this morning. credit suisse is seeing downside risk for the aussie. softer prices and anticipation from the rba. november has been kind, the investment of 2018 with a gain of 3.25%. we have bloomberg jpmorgan asia dollar index out -- heating at a gain of 1% with worst performers in the indonesian rupiah leaving that to recovery. 5%n so, the index is down after seven straight months of declines. the dollar strength may lose momentum with the potential uptrend for the yuan. we could see more ahead.

sophie kamaruddin in hong kong for us. the chinese leader made comments ahead of a crucial weekend talks with president trump. our china correspondent is in guangzhou. what is the message ahead of the g20? it is interesting, i'm in guangzhou which is the capital of the province. as you know. which is the export hub for china. trade is front and center for this province, so it would likely be on the minds of tosident xi when he went talk about the global economy. we need to choose between globalization and free trade, he said. or unilateralism and protectionism. he warned that you will see more trade barriers. itsaid china is opening up

markets but that access is becoming easier. he points to the example around the property sector and property rights. he wants to be on the stage with his european partners and wants to be able to portray himself as being the rational act of being on the right side of history when it comes to a trade dispute. the reality is more nuanced. we know that they share concerns echoed by those in washington and that those concerns are top of mind for european corporate leaders and those with exposure to the chinese market. the symbolism is strong and it is positive. it underlying that relationship remains a dynamic that needs to be addressed as well. initiative, europe has yet to sign off on that as well. regionou are now at the 's center.

how does the speech he gave tie into what is going on today? >> is really underscoring what he wants to see in terms of moves towards a globalized world. the comments from chinese policymakers, but we are in an china's export machine where they want to upgrade. they need that technology, that know-how from the u.s., from europe, from japan. getting increasing restrictions, not just in chinese investments in the u.s. and europe, but in technology from the u.s. to chinese markets. that could hamper his desire to see this province and others move up the value chain. biggest drugmaker, they want

to be able to combine at tech expert with manufacturing and logistics expert to the a high-tech any fracturing powerhouse. but they still need that technology. and there is a risk through that initiative. tom mackenzie, we will get more from you later today. to the central bank world now, and with two little words, jay powell at the market know that the federal reserve is observing how much more to hike and is not on a preset course. kathleen hays was listening to tell speaking of the economic club and said that it is just below the crucial neutral rate, a change of words that moved the markets. kathleen: absolutely. there are a lot of moving parts here. for a lot of people that are traitors and watching the fed, they say what is going to happen next. hikeset three more rate

and that is where they put their dot plots when they met in september. we want to the just above the neutral rate and they say that that is what is catching so much attention. we have a lot to do with where they stop with the interest rate increases. it seems to me there is uncertainty now over where the neutral rate is. it is in the heart of the candidate. and remember last month, it was tooff-the-cuff the remark judy woodruff that said the set is still a long way to go for neutral, but this is what he said. more measured it today. interest rates are low by historical standards and just below the range of estimates for that level that would be neutral for the economy. that is neither speeding up north slowing down growth. kathleen: just below the neutral rate. this was a speech about financial stability.

remarks majority of his -- he did start off putting this comment about how the economy looks good and inflation is where it needs to be. another thing that is important somethinglso echoed yesterday. -- two months,h saying the fed is not on a preset course. rate hikesking for in 2019 and the fed doesn't do it that way because there is always something where they assess the data. they are assessing the data to know, again, the neutral rate can get higher or lower. it is interesting that at jpmorgan, they were saying that the range is 2.5% to 3%.

at that end of the range, you had just about enough. they think there might be a lot more to go. i think we are learning a lot more about the neutral rate than we ever intended to. it'd focus for the fed. to the bank of england, mark carney making headlines with a pretty dire warning about what a disorderly brexit would do for the economy. >> i thought this should not go unnoticed. the bank of england is getting ready for the worst. in other words, a disorderly brexit. it's not their main forecast, it's what is the worst thing that happens? gdp drops 8% in the first year. house prices down 30%. 38% andal property down inflation accelerating to 6.5%.

the bank of england raising the key rate to 5.5%. remember is at 0.5% right now and will average 4% after that. saying our job is not to hope for the best but to prepare for the worst. institutionsancial are ready to withstand just about anything. and remember, carney has been criticized in parliament. legislatorare the that they are willing to risk a notrderly brexit, they are wanted to hear mark carney's warning today. maybe if you are an investor, you have to prepare for the worst, too. haidi: kathleen hays for us in new york. breaking news crossing the bloomberg. a consultancy hired has been cleared of anti-american charges. they rejected the claim that the consulting services

discriminated against american instead of staffing with indians on south asians. the verdict is a major victory, and the entire business model depends on exporting engineers to the u.s. the case does predate the andtion of president trump reducing the use of overseas workers. we will continue to watch that case is details become available. still more to come on daybreak asia. this is bloomberg. ♪ ♪

ramy: this is daybreak asia. iranian -- i'm ramy inocencio in new york. haidi: the dollar tumbled after fed chairman jay powell said interest rates are just below neutral now. our next guest says the dollar will depreciate until the middle of next year. chief currency

strategist and head of economics. that changed after hearing a surprisingly more dovish jay powell. kind of repricing expectations that we will see a the end of this bull run for the dollar? you recall what jay powell said after the september fomc meeting, in the market reaction we had was because a week after that september meeting, he said almost the opposite in the sense that we are far away from neutral. his speech overnight index of the central view which is the view of the fomc. this was described in september just below neutral. and that was exactly consistent with our view as well if you look at the fed's preferred measure. john williams sits on the fed board and it is a .6%. you account for a 2% inflation rate and that goes to 2.6%. the fed is currently 2.25%.

we will bring in 2.5% of below the 2.6% neutral rate. i think the remarks are very consistent and it doesn't change our dollar view. haidi: what if we get a significant improvement in the trade picture after this weekend? does that change the outlook for the dollar? >> not really. if you look at the other side of the dollar equation, the economies like germany, the eurozone, they are slowing. ipan and china's are flowing -- economies are slowing. the dollar is going to -- >> if you look at what is priced into the curve, that will come back a bit.

they are partially pricing rate cuts so it is no major surprise. exaggerated market reaction we saw last night was confirmation amongst some people that are still doubting whether this was the fomc's view. howell went to links to point out -- to links -- powell went to lengths to pointed out. time use the one year treasury yield, they can look at one year in advance and adjusted for inflation. it comes out a ackley at .6% which is a ackley where -- exactly at .6% which is where the fund rate is. fomc andarks by the jay powell are consistent with views of hours. ramy: i want to switch over to the r&b here. your strongest conviction remains depreciation here.

what is your best case scenario moving ahead with the trade war? conviction isst weakness in china's currency driven by two factors. the first is china's current account surplus spending to current account deficit. for the first time in more than a decade, it is a significant factor that will put pressure on the chinese exchange rate. the next swing from positive rate interactions. a negative interest rate, we have gone from a double positive to a double negative and negative interest rate differentials. that will depreciate china's currency. i'm sure it will be. help me square the circle here on why you think the aussie

and new zealand dollar williston the short-term. the -- -- will list in will lift in the short term. >> more and more, we are seeing a divergence in correlation between the australian dollar and the kiwi dollar as well. dislocated.mpletely they have lifted recently because there has been a reassessment of the economic growth in both countries. report ina market terms of trade and rate expectations have adjusted higher. this has helped support both of those currencies. there was quite a divergence atween the australian dollar the end of october.

ist we have seen recently the australian dollar have come back to where it direction -- thee it direction is, and quarter just confirmed that. the australian dollar and new zealand dollar were oversold a little bit. with regards to the correlation of china's currency, this is the big risk were 2019 as china's currency depreciate. will that drag the aussie in kiwi down at a time we believe the u.s. dollar will behave? talkedwe have basically about it being untradable given the wild flowchart about what would happen. that has limited a little bit now. that would you see a struggle from outside even if we do get what would be can through -- construed as positive results? >> we think volatility will remain the base case. even if we get a positive result , the u.k. economy is sluggish

at the moment. it carries a large account deficit of 3.5% of gdp and negative interest rate differentials. those letter factors are not disappearing. -- those letter factors are not disappearing. fundamentals over politics throughout this whole conversation. chief currency strategist richard gray, thank you for joining us. breaking news crossing the bloomberg terminal. this is with japan retail sales. trade coming in at 3.5% year-over-year. that is a blowout number, expecting 2.7% according to the survey. retail sales month on month also beat 1.2% versus and expected 0.4%. i want to put this into perspective. 3.5%, which are just told you, it is the 12th straight month in

terms of retail sales growth. we see this to the end of 2017. it is the second highest pace of growth ever since 11 months ago, back in the december reading of 3.6%. there had been some concern over whether retail sales could actually escape the slowing of growth in the japanese economy. it seems for this most recent month, we escaped the fear. just some corporate news crossing the bloomberg, raising a stake in ihh health, 32.9%, ¥330 billion, just about 2 ourion u.s. dollars by calculations. we will get you more details on that deal as they become available. more to come on daybreak asia. this is bloomberg. ♪

ramy: welcome back to daybreak asia. i'm ramy inocencio in new york. haidi: and i'm haidi stroud-watts sydney. follow to the lowest in 2.5 years, tumbling by a record in the dollar bond market after moody's cut the credit rating to junk. calling it a fallen angel with the loss of investment from greg rare. , theyvernment concerns are leaving in january after the r.b.i. refused to grant him a new three-year term. is said to have beat nestle and $4 billion consumer health unit over in india. the buyout is proceeding. the deal would boost unilever's presence and a growth market were to have strong historical roots and already controls hindustan unilever. wall street has lost one

of its most prominent characters. the fearless girl statue has to theved from her place front of the new york stock exchange by the end of the year. the artist created the charging bull in 1989 and says having the girl faced down his work has turned the bulls power into something negative. markets are seeing some upside, australia trading up by about .9%. session highs, seeing the upside there and positivity when it comes to the nikkei as well as all futures when they get trading underway. coming up on the next hour of daybreak asia, haidi, university of chicago business professor and former fed governor randy crossnore is joining us to talk about the jay

powell speech we have been talking about that put a rocket under u.s. equities, jumping the most in eight months. the japanese market open is next. this is bloomberg. ♪

haidi: good morning, i'm haidi in sydney. in the asian markets are just open for trade. ramy: and good evening from bloomberg global headquarters in new york. in hong kong, welcome to daybreak asia. ♪ haidi: the fed chairman's sentiment on dovish comments fueling speculation that a rate hike is closer than we thought. and the rally