bestming up on bloomberg -- that the house does not support this deal. >> this is a catastrophic defeat or this government. >> theresa may heads back to the brexit drawing board. >> i do not know where this takes us. this is incompetent chaos. >> wall street has something to digest as a parade of u.s. banks march out earnings reports. >> goldman had its first quarter since the crisis in terms of financial trading. >> there is nothing to get excited about, one way or the other. >> this cannot deepens in d.c.

and the government shutdown drags on. >> the back-and-forth continuing. >> neck and merger creates the world's largest gold mining company. carmakers come together at the global auto show. >> you used to have to worry about the car business. now you have all these macro issues. >> and the chicago fed president gives exclusive insight. >> i do not think there is a hurry, and you would not want to make a mistake. >> it's all straight ahead on "bloomberg best." hello, and welcome. youris "bloomberg best," weekly review of the most important business news, analysis, and interviews around the world. let's start with the top

headlines. a big week for u.s. bank earnings began with quarterly results from citigroup on monday. >> citigroup kicking off a week of big earnings. shares rebounding. the trading environment has improved a little bit. some of the concerns on the earnings call were the revenue, off 21% area remember citigroup and the other major five thanks lost $2 billion of equity tell you the last three months of last year. -- equity value the last three months of last year. another good thing about citigroup is that loans came in at a good pace, which signals a healthy environment. the cfo had mentioned there would not be real troubles until the end of this year should trade continue to weigh on economic growth. u.s. banks in focus today, with jpmorgan missing big on the

second quarter, and wells fargo seeing a decline in revenue due to shrinking loan balances. >> with jpmorgan, i thought the quarter was fine. there was just nothing to get excited about one way or the other. the capital markets business was a big miss going into the quarter. they have already sort of made up half of that in january. the key issue for wells fargo is the fact that the asset cap's, which is something the federal reserve puts in place around february of last year, the bank had been operating under the assumption it would be removed in the middle part of this year, and management is now talking about operating underneath that cap through the end of 2019. >> when asset cap went to to place a year ago, there were a couple of things we described at the time to make sure there was plenty of headroom under the asset cap. those were institutional deposit-taking businesses. we took down our balance sheet to a little bit below where it 2017. the end of

that, plus what has happened in the market for deposits this year, is more deposits have flowed into money market mutual funds, has created plenty of headroom to operate under. >> parliament finally gets to vote later today on theresa may's plans to leave the european union, with just about no one expecting her to win. the only suspense at this point is by how much she will lose. >> everyone is talking about how much she is going to lose by. some analysts are talking about 250 votes. that would go down in history as one of the worst defeats in at least a century. b? that's whatn the rest of us want to know. hinge on theng to margin of defeat, whether she has to come up with something radical, or if she can say, i just need more time to negotiate.

ayes to the right, 202, left, 432.o the >> it is clear that the house does not support this deal, but tonight's vote tells us nothing about what it does support. >> this is a catastrophic defeat. after two years of negotiations, the house of commons has given its verdict on the brexit deal, and the verdict is decisive. the most important issue facing us is that the government has lost confidence of this house and this country. mr. speaker, i have tabled a motion of no-confidence. >> i do not know where this takes us. in many ways, it would have been just as unfathomable if she had only lost by 50.

so many options are on the table . it is hard to see how these two parties are going to resolve the situation. >> i think the reason the markets are in a calm about it all is because it takes away the option of just crashing out. they have to defer, delay. i think the prospects of a ,econd referendum are rising and i think the prospects of no brexit at all are rising, because you have to go back to the drawing board. this is just incompetent chaos. america really hit the mark after banking on strains in investment banking revenue. >> i think citi and jpmorgan kind of set the tone. investors were not surprised today when goldman had its worst quarter since the financial crisis in terms of bond trading. bank of america also significantly down. investors need to look at the bright spots.

for goldman, that was on that m&a front. they took advantage of the merger boom we saw last year. for the of a, it was the consumer business. right, 306.to the the nos to the left, 325. the nos have it. >> the house has put its confidence in this government. i stand ready to work with any members of this house to deliver on brexit and ensure that the house retains the confidence of the british people. >> theresa may has to make sure she is clear on what will deliver the exit with a negotiated settlement. and make sure we then go back to the eu with a very clear ask. i think it is really important now. we have limited time. we need to use that time to

secure the type of agreement that will protect our economic interests. >> bloomberg sources tell the eu she must radically rethink her red lines to reach a new agreement. how will the is the eu to extending article 50 to delay brexit? >> the official line from the u.k. is deal, no deal, the u.k. will leave march 29 and that's it. in brussels, the music, i should say, sounds very different. they think the u.k. cannot afford to go no deal in two months, but also that period is inevitable at this point. >> it has been a week of big earnings for wall street banks, but reports from morgan stanley this morning are falling short. on shares plunged 30%. banks are saying it is because of volatility. .n this case, it was down 30% i thought volatility was good for traders. >> we have been hearing this

refrain about bad volatility. that means in the fourth quarter, we had a few periods of sharp, sudden moves that did not sustain price volatility, but just kind of happened and work on. -- and were gone. the banks were unable to make money off of that short volatility. they want prices to move around on a more sustained basis, but not too much. and in morgan stanley's earnings, we saw equity trading did not do well either. the bond trading results were the worst on the street, so we will look to see how they improve on that as things improve this quarter. >> theresa may has refused to budge on her so-called red lines on brexit, we understand. this puts her and a political stalemate with jeremy corbyn, who wants the government to rollout the no deal exit. pm's also limits the options when she goes to brussels to seek further assurances with the european union.

how important is it to the european parliament to avoid a no deal brexit, a so-called hard brexit? it is not important enough to restore the integrity of the market. that is very clear. there are many other things we can do. dealhave to say no to the and come up with a new proposal. that is not our concern. we will see what they propose. u.s. treasuries denying reports that steve mnuchin has pushed for lower or no tariffs on china. also, it was claimed that trump administration officials were considering rolling back duties to calm the markets and lubricate the trade negotiations. >> when it comes to trade talks, where do we stand now? >> did seems like, at least

temporarily, the markets were buying into the idea that the administration could be softening its stance towards china when it comes to negotiations. we had a denial from the u.s. treasury department, but it is clear that steve mnuchin has long taken a stance of caution when it comes to the imposition of tariffs. it could just come down to the whims of the president, and we should not forget that like theer is the one leading trade negotiations, and he is taking a more hawkish stance on china. he will be the one talking to china's vice premier when he heads to washington at the end of the month. and it could go to trump and how he views things at that particular time. china would be reducing its trade surplus to zero, basically, by 2024. last year, that stood at $323 billion. >> we need to put this in perspective.

the u.s. exported in 2017 a record $150 billion to china, a record at the time. how you get from the u.s. export side to meet this kind of demand from the chinese is a big question. whether that capacity exists in the u.s. economy, which is already running pretty hot. we do have some time to go in the negotiations, but this is another sign that both sides are negotiating constructively and there is a lot of momentum towards a deal. kailey: still ahead as we review the week, an exclusive conversation with chicago then-president charles evans. plus, cisco ceo chuck robbins gives a view from the tech industry on the u.s. trade war with china. and the chinese government begins to take bolder steps to shore up a sagging economy. developmentnal reform commission, they say they

will be outlining measures to support the auto industry. ♪

kailey: this is "bloomberg best." tour continue our global of the week's top business stories in china, where downbeat trade data provided the latest indication of an economic slowdown. inchinese trade slumped december, underlining the impact of the trade war and an economic slowdown. the numbers are the worst since 2016, with both exports and imports falling from the year-earlier. what did the numbers tell us? are think the key takeaways amountowing domestic coupled with slowing global demand is hurting the export sector. do not expect this to turn around anytime soon. member this is just the latest

software eating on china's economy -- soft reading on china's economy after slumps in retail sales, factory prices. the manufacturing sector is softer as 2019 gets underway. taxes on a larger scale to help the slowing economy. the statement follows a series of weak data we got. saying monetary policy will remain prudent, but flexible. they will try to make sure there is a reasonable amount of liquidity in the system. we have seen measures to ensure there is additional liquidity being pumped into the bank. there will be measures to support the auto industry. we have seen auto sales last year falling for the first time in almost three decades.

what those measures will be exactly, we have yet to find out. there will also be measures to step up household appliance purchases. we have seen tax cuts for personal incomes that have already kicked in, at the corporate level. they are going to be targeting small and medium-size enterprises as part of the larger tax cuts, as well as the manufacturing sector, under pressure because of the tariffs. >> china's richest scrambling to protect their fortunes from the newest policies. we know that china's taxman has been given additional tools to try to target the rich to pay for some of these tax cuts for those on lower incomes and small businesses. we have seen that four wealthy tycoons, billionaires, have already put aside and transferred about $70 billion worth of wealth into offshore family trusts.

amongst them are the chairman of sumac holdings, that major chinese property developer. he transferred 4.5 billion u.s. dollars to a family trust. it was also one of china's richest women who made a transfer around a similar amount. the problem for china's billionaires is that there is a guarantee that if you put your money into these overseas trusts, the chinese taxman can't get a hold of some of that anyway. >> a billionaire fighter of swan lake has broken his -- the billionaire founder of huawei has broken his year-long silence that the company helped aging spy on western governments. >> it is interesting, because he is quite reclusive. guy, theormer pla chairman and ceo of this company, and he rarely talks to the foreign media.

it shows the significance of this spat with his eldest daughter's illegal trouble in canada. on the one hand, he called donald trump a great president, and that they have to take a wait-and-see approach to see if donald will intervene on behalf of his daughter. he also went on to say huawei is only a sesame seed in the trade conflict between china and the united states. are said toecutors be pursuing a criminal case against huawei for allegedly stealing trade secrets. how serious of an escalation is this? >> this is a pretty significant escalation, and it comes after a series of steps that have been taken both in the u.s. and europe. the company is effectively tsocked from using i equipment in u.s. telephone networks, and the trump administration has been pressuring european allies to do

the same. the u.s. is trying to clamp down on huawei, which it regards as a potential security threat. the u.s. contends it could be -- it's equipment could be used to spy on americans, and it has direct ties to the chinese government. president trump nominee for u.s. attorney general asserted independence from the white house today, during the first day of his senate confirmation hearing. members of theld senate judiciary committee that he told russia -- that he believed russia tried to interfere in the 2016 election, that the special counsel's investigation is not a witch hunt, and that jeff sessions was right to recuse himself. trying to barr downplay criticism from democrats about his skepticism of the memo that was drafted prior to his nomination regarding robert mueller's investigation. he left the door open to still

have oversight over mueller's investigation, and he noted a very piece of -- very notable piece of information that he would not make public bob mueller's investigation, and that he might submit a separate draft to congress to review. finally, from a financial perspective, he said he would recuse himself from the at&t-time warner deal, as he previously served on time warner's board. >> the longest government shutdown in u.s. history has entered day 28. donald trump nancy pelosi are engaged in a better tit-for-tat. president trump canceled the delegations trips to the summit davos.os -- a summit in the president's acting budget director has put out a letter instructing all government agencies that no u.s. travel from the u.s. government should

be used during the partial government shutdown for any congressional delegation trips. the back-and-forth and whatnot, all of this would illustrate that there does not appear to be any significant progress being made on this partial government shutdown. ♪

kailey: on the heels of dovish comments by federal reserve chairman jerome powell, this week senate officials continued to stress the need for patience when it comes to the path of rate hikes in 2019. perspective from the chicago federal reserve bank

president. >> the economy is doing well. we saw a lot of strength in the december employment report, 312,000 jobs created. you are right, i went in thinking that 2018 -- we are points from being at a setting that is just a little bit restrictive. it is almost neutral, but just a little bit restrictive. that is the setting that, with my outlook for a good economy, i could say we could set that rate for quite some time until we see the economy decelerate to trend, inflation hanging around 2%, the unemployment rate still continuing to the good. timing is not a big deal, because even if we were to increase rates in june, you have in september.

i do not have any increases slated for 2020. with all the uncertainty with some other things going on, europe softening a bit, i think we are actually well positioned to sort of assess how the data are coming in, whether or not our business contacts see things proceeding and little differently than the national data, and we can respond appropriately. we can be patient. >> the thing that seemed to shift at the end of the year was the big falloff in stocks. i am wondering, was that what really precipitated this sense that we now need to communicate to the world that we are on's, that we -- that we are on pause, that we are going to wait and see now? then, wasce, until not new, and there does seem to be a shift as we get into 2019. >> you have to ask yourself, what is it the markets are seeing that we may not be

putting as much weight on? maybe they are taking on board they know that we have seen -- they have seen before we really assessed it as being on the softer side. another factor is the markets may have been slower to truly assess the deceleration to growth to trend. it may not be that different outlook for what we had, but they are assessing it differently. that is a more benign interpretation. that puts us in a situation where, if i am comfortable with the funds rate now, i do not think there is any hurry, and if -- we can look at the data coming in and be cautious. kailey: still to come, more of the week's top business news, including earnings from netflix. and, more compelling conversations. cisco ceo chuck robbins talks briefly about trade wars, and says they are too clumsy to solve very difficult problems. >> it is too difficult to

understand how to do it surgically, so i will have to do it with brute force. ♪

comcast business built the nation's largest gig-speed network. then went beyond. beyond chasing down network problems. to knowing when and where there's an issue. beyond network complexity. to a zero-touch, one-box world. optimizing performance and budget. beyond having questions. to getting answers. "activecore, how's my network?" "all sites are green." all of which helps you do more than your customers thought possible. comcast business. beyond fast.

♪ welcome back to "bloomberg best." detroit was the place to be this week for global automakers, as the city hosted the north american international auto show. new models were introduced new partnerships announced,, and there was plenty of opportunity to discuss headwinds in 2019. david westin said down with seven top executives to discuss the state of the industry in their companies, starting with the ford president and ceo, jim hackett. ♪ >> i want to tell you, i'm not happy about ford's performance. that should just be said. i knew it was going to be a difficult year because of the age of a product. moving from the oldest

product line in the industry to the most refreshed, 75% of the products, all-new in the next two years. that is going to be really important. you put that against what kind of market we expect, i think the auto business is going to be solid. signalsomy itself has iat create uneasiness, but don't think there is anyone who would say we are in any kind of recession right now. >> so when it comes to the economy, what affects your business? is it sentiment overall? concern about training complex? what drives your business? >> sentiment is a big deal, because people want to believe their jobs are safe. interest rates can matter because of the changing profit of the vehicle. -- i think it is right now things are firing on all cylinders in our economy but for

political strife over policy and some of the trade issues. 4 have had great employment, million jobs have been created with this current administration. i think it is worth stepping back and saying it's in pretty good shape and it can run for a while like that. ♪ affect vws trade america? >> it used to be a simple business, now you have all these macro issues, particularly trade issues. i think on the trade front, the big issues -- the first is the usnca. we have put what this means for us, and i think we are in relatively good shape. we have a plan for mexico and chattanooga, and the big thing we are looking at is the labor value contest. we have five years to comply and i think we will put together a smart strategy. with regard to tariffs, not very

big for volkswagen, since 96% of our volume comes from the north american market, produced locally. we have smart solutions, but like anything, you have to be prepared. ♪ wefrom car talk in detroit, turn to a conversation about bicycles in shanghai. a chinese bike sharing startup backed by jack ma is considering an ipo. the company says it is well-positioned to dominate the sector as financial woes mount at competitors. we spoke exclusively to them. ♪ >> hello bike has been the number one in this industry since april, 2018. our daily rides are equal to the combined rides of other competitors. put simply, we take half the market share. >> what is your strategy for monetizing what is essentially a capital-intensive business?

>> relying on the revenue from daily rides is enough, and we have proven this. in over 100 cities we break even from the daily rides. >> what are your future funding targets and what do you see your current valuations sitting at? short-term, we don't have fundraising plans, as we are very well-capitalized. if needed, perhaps in six months, we might consider a new round of fundraising. we are valued at around $5 billion right now. >> their spain some speculation that softbank might be looking to invest in your business. is that a conversation you've been having? have you at least entered into discussion with softbank? softbank,contact with but there's no substantial development or anything that gets us closer to a deal yet. >> is an ipo and eventual objective for the company? what kind of timeframe that we looking at? >> we will definitely go public

at the of the day. we don't have the timetable yet. our business is still rapidly growing. when the time for an ipo comes, i believe our company will be value that tens of millions of dollars, much more that it is now. ♪ >> the u.s. and china are preparing for further trade talks in the coming weeks. one of the major points of contention, china's policies on technology and intellectual property. this week's cisco system discussed trade technology and national security, and how he sees the ongoing disputes between the world's two largest economies. ♪ creates this flat world that we live in. fundamentally the technology we have built has created a flat world, and now we find ourselves with lots of conflicts around the world. the geopolitical dynamics are complicated for all of us. companies are trying to figure

out, how do ideal with this technology change that is occurring so rapidly. frankly, it is very difficult because governments around the world don't have the expertise inside the government to be able to regulate or determine what they should do. what that leads us to our very binary decisions. it's difficult to understand how to do it surgically, so have to do it with brute force. >> you are in a position to understand something that we don't. how much of the u.s.-china trade dispute when it comes to technology is trade, and how much is national security? we hear, for example, the long way -- >> i get the same information you guys get on this issue. in general, there's aspects of intellectual property, there are aspects of trade deficits, there is the view that this 5g buildout is critical to every country's future, and there's

this competitive race going on around the world. i think it's a bit of all of that. my hope is that we can get to a place where we can all move that lifts they global economy and allows us to take advantage of the technology. what it can do not only for business -- we are at a point in time where technology can help solve the biggest problems of the world, and that's what we need to be focused on. >> it was hank paulson who referred to the possibility of an iron curtain of technology. if that happens, there's a binary alternative -- but if that happens, with that hurt or help cisco? is china a frienemy? >> we have great relationships, in our business, while small, has been growing moderately over the last few years. if that happens, it is just bad. we need to figure out a compromise position to help both

countries get to what they are trying to get to without breaking down the fundamental value in the first place. ♪

♪ this is "bloomberg best." let's resume our run-up of the week's top business stories with a surprising turn of events in european banking. planssantander canceled for appointing a new ceo. ♪ >> banko santander has reversed course on the next chief executive after standoff over tens of millions of dollars. the move comes just four months after his appointed was announced. how unusual is it that there is a fight like this?

>> gets a bit of a shocker, and it's also a huge surprise. at the heart of it seems to be a dispute over $50 million of deferred bonuses. ubs is sticking to a hard-line, saying that we will -- we will not pay you for joining a competitor, and santander -- it's not something i've seen recently. ♪ >> netflix announced it is closer -- streaming giant the shares hit the highest in nearly three months, this bodes well and many people like the fact that they can pay even more for the costlier content. itsetflix is flexing pricing muscles. it goes to show that netflix is really confident in its subscriber trends and content for 2019. at the end of the day, it's a

compelling price value proposition. that is what netflix believes that what most consumers are seeing. this really does remain one of the cheapest alternatives for entertainment out there today. in thelix tumbling after-hours session after delivering a mixed report, suggesting that the company's unprecedented som spending spree may not be paying off. >> give us the pluses and,, probably the minuses. >> the pluses that subscriber additions were higher than people were expecting, and netflix, which is more than 20 years old, ol, added 29 million customers. the downside is the revenue came up short. they now generate more than half their customer base from asset. the prophet wasn't what people wanted because of how much they are spending, especially now that they are spending more on

original movies. that's more capital intensive upfront, where tv can spread out the cost. ♪ >> bloomberg sources say apple was planning to cut back on hiring for some divisions after a miss for the revenue forecast. >> apple tried to put a positive spin, saying that the iphone sale decline would help them innovate. what exactly did they say? >> so this is from sources inside apple. apple didn't come out and say this, they didn't respond to our request for comments, but we are told that with a meeting with employees, tim cook was asked if there would be a hiring freeze in place to offset the slowed iphone sales and reduce revenues. he said a hiring freeze wouldn't be the solution to the current problems. instead they would reduce hiring in some divisions, excluding the hotter markets like artificial intelligence. it underscores the deepening

slowdown in both iphone sales in the global economy. i taiwan semiconductor manufacturing -- what does this dismal outlook mean for china and for apple? >> it's not good news for apple. tsmc, apple is their biggest customer.apple designs them and they make them on apple's behalf. when they are forecasting in this march quarter that their numbers will not be as good as expected. there's a certain read across to apple,. given the tribulations that they have had in recent months, there might be a dual effect, exacerbating the problems. ♪ consolidation is the global gold mining industry. mining will board -- there will be a merger valued at $10

million. paying a percent premium based on the weighted average share price of the last 20 days. this comes only three months after we saw them moving to buy randgold resources. does this mean we will see more m&a in the industry? >> that's the expectation, especially since they will be shedding the assets. they are looking at the $1.5 billion of assets, and people are thinking that the next two deals -- people will be buying of this asset. >> may have some good, complementary assets that fit well within our portfolio. we have four operating regions, and we will go through and assess and decide which operations we will continue to work with on the value versus risk basis, and look at our own, reshape that portfolio in target of gold producer that will be set for the next couple decades. ♪ >> snapchat's parents says the

chief financial officers leaving eight months after taking the job. top concerns, the latest in a number of executive defections, where shares sank in late trade. the company isn't saying exactly what prompted him to quit, but they are saying what it is not about, and i have this memo to his employees. he says his transition is not related to any disagreement relating to our accounting strategy, management, operations policies, regulatory matters. basically he's making all the regulatory commentary he needs to make to not spook shareholders, however they are spooked. the shares are down more than 8% in aftermarket trading. ♪ >> drano is set to be ready to replace the chairman and ceo, carlos ghosn. board members are saying the

decision needs to be made. he remains in a tokyo jail. what do we know about his intentions at this point? >> he pointed to the right word, urgently. this is a company that has been operating with an interim ceo almost for two months now. they have to get someone in place who can take control and have the full authority to operate this company. it's a global business very complex,, part of the three-way alliance with other automakers. there are a lot of big decisions any to be made, so they need some sense of permanence. >> they have stood up for him in the past. they did not initially agreed to oust him as nissan had done. they are only now making the decision to hold a board meeting at which they will name a replacement for him. ♪ >> after a catastrophic three months for pg&e, the company

says it will be filing for bankruptcy in california. is it certainly won't file for bankruptcy? some politicians in california thought this was a threat on the utilities part. >> pg&e has been accused a couple times in the past of crying wolf on bankruptcy and using the threat of bankruptcy to get concessions out of state politicians. but the filing the issue today with the securities and exchange commission looks like this is the real deal, and argues that they concluded they have no choice but to file for bankruptcy. it spells out that they may be facing more than $30 billion in wildfire liabilities. there's always the possibility there would be more this year that could be tied to their equipment. 11 is the onlyr viable half forward. ♪ says it will be cutting

7% of its workforce. does this come as a surprise? i thought they were stepping up to make sure they could make enough model3's. >> we heard elon musk the last couple quarters build this case that tesla is at a turning point, where they are going to be able to make money going forward. they will make money and generate cash. he has been very confident on both those points. longnk the street was not for the ride until the last quarter when the results came out and surprised everybody. this is a dramatic shift away from that, where he is talking about the road ahead being difficult. we started the year with the company cutting prices to partially offset the tax credit in the u.s., dropping by half. this is a company that still is not in the clear after what was an insane 2018. ♪ >> jack vogel, the man who

founded vanguard and virtually created the world of passive investing, passed away yesterday. a host of financial luminaries poured out their praise, among them, david solomon of goldman sachs, howard marks, sallie krawcheck, and charles robb, saying that they stand on the shoulders of jack vogel. >> the financial industry has lost the legend and investors have lost probably their best advocate. what he did, i think, is hard to understand today, because we are so far removed from the 1970's and what infesting was like. making a portfolio of individual stocks almost at random, and here's a guy who comes along and says, own as many stocks as you can that represent a broad swath of the market and leave alone, pay as little as possible, never look at it again, and when you wake up and 50 years you will be rich. that sounded revolutionary in those days. ♪

♪ let's take a look at the description page here on the uti crude and talk about the leverage, the contract, and the trading mechanics. >> the first thing to look at the leverage, about $5,000. overlay that with the contract, that's about 10% leverage, that is what is standard in futures. >> there are about 30,000 functions on the bloomberg, and we always enjoy showing you are fit -- our favorites. maybe they will become your favorite. here's another function you will find useful. it will lead you to our quick

takes, where you can get important and fast insight into timely topics. here's a quick take from this week. ♪ china spies have a lot of unwanted attention recently, thanks in part to political in trade tensions between china and the u.s. many of those spies work for the country's main intelligence agency, the ministry of state security. in december, 2018, one of china's top tech executives was arrested in canada on the u.s. extradition request. soon after, agents abruptly detained to canadians in china, then days later, the u.s. publicly named two alleged assets as part of a sweeping u.s. indictment involving hacking on a global scale. the series of events had people asking, what exactly is the mss? this is your bloomberg quick take on china's elusive spies. ♪

>> compared with the u.s., the mss is something of a mash-up. it conducts intelligence operation abroad, like the cia, counterespionage at home like the fbi, and cyber snooping like the nsa. >> when you hear the details of how the mss operates, you think it wouldn't be out of place in a spy movie. the number of employees is classified, the exact location is unknown. it is thought to be in a nondescript building in beijing. it does not have a public office or website. >> what's clear is that the mss is clear in xi jingping's efforts to tighten control over security. the head is in next police who helped direct the nationwide anti-graft campaign. in 2015, the national security law extended the mss's power to outer space in the deep-sea, as well as the internet. >> the mss benefits from close ties between the state and chinese tech giants, all

of which have the ability to mine for small data. other government departments are required to cooperate with the mss and provide support for its activities. >> the mss operates secret detention facilities in china, and is known for its harsh treatment of dissidents. for example, the blinds civil rights lawyer was under house arrest for 19 months before he fled to the u.s. embassy in beijing in 2012 and eventually moved to new york. >> the organization has developed a fearsome reputation, based on how much power it has on the vague limitations. foreigners have alleged violations of basic rights while in custody, and some have talked about daily, six hour interrogations, not having access to lawyers, or confinement under lights that never go out. >> media reports have noted some key mss victories, including the

possibility that they monetary president donald trump's calls, made on unsecured cellular devices. there was also a report that the mss had dismantled cia operations in china over several years, killing a dozen or more sources,ency's reportedly in one of the worst u.s. intelligence breaches in decades. >> this isn't an organization that is completely under the microscope. a senior officer was arrested in belgium index related to the u.s. in 2018 on charges of conspiring to steal trade secrets. but you have to remember, this is still an organization that's very powerful. that was reportedly the very first time a spy for china's government had ever been brought to america to face charges. ♪ >> that was just one of the many quick takes you can find on the bloomberg. you can also find the metal of her.com, along with all of the business news and analysis 24 hours a day. that will be all for "bloomberg

best" this week. thanks for watching. this is bloomberg. ♪

i am a family man. i am a techie dad. i believe the best technology should feel effortless. like magic. at comcast, it's my job to develop, apps and tools that simplify your experience. my name is mike, i'm in product development at comcast. we're working to make things simple, easy and awesome. unstopand it's strengthenedting place, the by xfi pods,gateway. which plug in to extend the wifi even farther, past anything that stands in its way. ...well almost anything.

leave no room behind with xfi pods. simple. easy. awesome. click or visit a retail store today. ♪ emily: i am emily chang in san francisco. this is "bloomberg technology." coming up, tesla letting go of thousands of employees. can the competition take advantage? plus, trade hope? china makes an offer it helps the u.s. can't refuse, a plan to shrink the trade deficit to zero. talks are set to resume. amazon under pressure over its facial recognition software. why shareholders are now joining the debate.