sany: i am emily chang in francisco. coming up, doom and gloom. we will bring you the latest in the market with details about how the tech sector made out. office space company has filed for its ipo. and the chair of the u.s. federal trade commission says he will break up big tech companies

if need be, but get ready for things to get messy if he tries to. first, our top story, u.s. another deepng selloff, surging as massive signs of an economic global slowdown stoke fears of a recession. and be tech driving the losses. amazon and microsoft deep into the red. president trump rekindled the trade war with china at the start of august. the s&p 500 down 1% intraday for 11 straight sessions and is now down six are sent from the july record. -- 6% from the july record. we are joined by an expert. a lot of blonde buying today. lot ofes that mean -- a bond buying today. what does that mean? record low, at the same time seeing a long

rally to we see the inversion between the two-year treasury yield and the 10-year treasury year to for the first time since 2007. no, we are no longer in negative territory, however, that does stoke concerns, so what does that mean going forward? if you think of some of the most high beta areas of the market, tech is largely put into that group, maybe not as much software, but when you think of semiconductor stocks, even apple, they are so intertwined with china as well, some of these areas are really intertwined. youfact of the matter, when think of the messages we are seeing, one, the inverted yield curve, sure, this time, you see flows from foreign money into bonds. also, some say the yield curve completely is artificially lower because of what central banks around the globe have been doing, but in the past come it receded a procession -- preceded 12 to 18 months

out, that does not bode well for some of the big tech names. emily: we have been talking about how this bond activity can be a sign of a recession. what does that mean for text, especially? so technically when we do see the us signs, you do not see a reaction right away. well, you do see a reaction right away, but that is not me and the stock is completely peaking right away. look at the philadelphia semiconductor index, for example, we do see a pretty state fall, falling into correction territory, now down 11% from the highs, plummeting through, 150-day moving averages. day is still pretty far away. software,k at hardware, those two areas the thanlly fell even more

semiconductor stocks. you have to take into account the gains that we saw yesterday in hardware stocks led by apple, because yesterday, we were dealing with the news that the tariffs were going to be delayed. now we get the flip side of that, not so much about the tariffs, the tariffs are still delayed, but whenever you get a steep selloff of the market, you will see that come right back. emily: all right. let's talk a little bit about cryptocurrency, because the week ago, we were talking about bitcoin potentially being a safe haven, and as the rest of the market was going down, bitcoin was coming up. for the last three days, bitcoin has climbed, so is that not the case? sarah: i do not know that that is absolutely the case. we have heard that statement made. when you look at gold, higher today, japanese yen higher today, very strong gains, but look at bitcoin and say, oh it is a similar story, to gold, you can look at bitcoin as a safe then, but the fact of

matter is, bitcoin is extremely volatile. no one can debate that statement. to look atdifficult bitcoin as a true state haven because of the volatility that you see from day-to-day, strong swings one day and then huge, huge falls the next, so i do not know if you can go as far to say that big one is a true safe haven just yet. sarah: all right, across asset reporter sarah ponczek, sara, thank you so much. the company just filed for their ipo. they are expected to raise closer to $3.5 billion. that would make it the year's second-largest ipo behind uber. of $690of a loss million in the first half of the year and almost $300 million lost in the last three years. joining us with all the details, our very own l hewitt, who has

ework to this w point here what was the surprise? elle: there were a couple of things we already knew. they were giving out financial information quarterly for the last year or so, so we knew that, for example, and 2018, to $2 billionose while making it revenue around $1.8 billion. so there were some surprises. we got some details about some of the loan and complicated structures between the founder, adam union, who is also the ceo, one who had famously been a landlord if the properties that wework had rented, but we learned about loans the company had made him, the succession plan if he were no longer able to serve, that sort of thing. a complicated corporate structure, and on top of this, they are offering free classes

of stock, one with 20 times voting power as another, which, even today step further than what mark zuckerberg and the founders of google have done. ellen: right. one, class a, has one vote for share, as you would ask, a great consolidation of power. it is all or not all but largely in the hand of adam neumann. voting control over the company, and that is kind of by design. people who support the structure of a fed adam has the right vision, the boldness and the leadership to take wework even farther than it has been, and obviously for some of the people, they will look at that and raise their eyebrows, thinking that might be too much. emily: the other thing that is interesting is they lay out exactly how many of the buildings are fairly new. 30% of their locations are mature, as they save your 75% are two years or younger. ellen: yeah. dr. bin bishr: the vast majority

-- emily: the vast majority of their space is relatively new. they have changed the definition of a mature location, and even with expansion, you are right, it is only 30% of their office locations. they are focused only on mature locations. they say this is where you do not have to rely that much of marketing to fill the building. that is only 30% of their portfolio. it starts to raise questions about how sustainable their growth is and how easy it would be for them to get to profitability if they stop growing. emily: and they say, and there risk factor, they may never be profitable, with we heard similar to uber and lyft. are they excited? ellen: i see a lot of activity

on both sides, the growth is really exciting, and other people cannot wait for it to go public, so they can short it, right? emily: [laughs] ellen: it is a divisive stock. the price will be decided soon by the public markets, and a lot of people are wondering if it will meet the $47 billion private valuation. emily: how quickly do we expect it to go to market? when does the roadshow launch? ellen: we had reported that we expect a september ipo, and that is just around the corner. emily: all right, bloomberg you will be huet, covering every step of the way, thank you. lowes fell to a record wednesday. fallen by more than half on one-fourth since its ipo. much of that has come in the

weeks of the company reported earnings. uber missed earnings. listen on the app, bloomberg.com , and on sirius xm. this is bloomberg. ♪ this is bloomberg. ♪

emily: all right, we have often covered how big u.s. tech companies are lobbying spending on d.c. attic is going up. now even the embattled chinese uawei isgiant h working as it fights for the right to do business in china. -- as another company is fighting for the right to do business in china. we have been brodie and our global executive editor for technology, tom giles.

ben, what exactly is huawei doing here, and why do they want them on board? ben: they have hired that group, and they have hired another group, federal advocates, that have ties to washington in the public and leadership, and they want to lobby on expert controls that are stopping them from buying into the u.s. markets right now. are close -- are a little bit vague about it, but law firm working with him and some other cases, and we also have telecommunications issues they are working with with the other lobbyist, so it seems like they are trying to break the back. down their shut aerations last year, and now full 180 because of the resident putting them on the black fight. like.hat is what it seems they had gone down to three

staffers and downtown washington, d.c., a little bit over from the white house room where i am sitting now. they had basically gotten rid of their outside consultants, or they were not having been doing anything or having them spend any money. now they have three law firms to add lobbying on to their mandate as well as the sort of trump-connected firm, federal andcates, and michael another who is on the top fundraising committee for the trump reelection campaign. meanwhile, tom, the president delay in tariffs on some goods until september, things will take effect in september. impactthis continuing to tech companies continue to impact the supply chain, you have the maker of ap laptop saying they are moving their

production out of china. sense to lookakes for an alternative out of mainland china. what we have seen over the last several months is tech companies looking to bits and pieces of their production, 5% here, 10% there, kind of do it around the edges. problem that a lot of tech companies are encountering rain now with u.s.-china relations is no matter how this gets resolved, it shows you the vulnerability of -- and the risks of keeping all of your supply chains in mainland china at a time when the u.s. havoc withan wreak u.s.-china trade relations by threatening the trade war, imposing sanctions, ratcheting them up, rattling them back, there is what looks like a game happening here, and if you are reliant on china, you can not be subject to the whims of one administration or the chinese government on the other hand,

whatever the case may be. result ining to truly better trade relations between the u.s. and china? is this all a negotiating ploy heading to the 2020 election? it is so really hard to tell. all that aside, if you are relying on china, you need an alternative, and i think that is what is happening here. no matter how this gets resolved in the short-term, longer-term, u.s. companies are saying it really does make sense for us to look outside. and so we are seeing almost every day that passes, every week that passes, another u.s. company talking about are showing one way or another we are looking for an alternative, so you are increasingly seeing the emergence of this alternative second supply chain. you haveantime, ben, got the u.s. government leaning on allies to not rely on huawei, to push huawei out of its plan for a 5g network, a sort of

pawn in this u.s.-china trade war. are those u.s. allies coming on board? whose side are they on? thatyeah, i think that map you have up there really tells the story, the u.s. has really struggled to convince allies that they need to make this move. that it isrd reports a movement potentially with india, that india might be willing to go up against china in that particular move, but when it comes to europe, when it comes to the top allies, those countries that we share intelligence information with, it has really been a struggle, and it is not hard to see why. huawei is cheap and reliable, and huawei keeps coming out and saying my gear has no more cybersecurity risks than anybody else's. there is always the possibility of backdoors. and for the most part, allies might be improper conversations,

in private conversations, we are a little worried about it, but i think you are out of luck and are going it alone here. emily: tom? tom: there is a big question mark about how much of a threat while way really is, and what they they are sure of is huawei equipment it seems is pretty darn reliable, pretty good, and pretty cheap, and what are the alternatives? that is the question that is paying over the deployment of 5g. like: i mean, it seems there are no alternatives of the same quality level. tom: that is what we hear time and time again. you have people like nokia, like erickson, who do provide some of the infrastructure, some of the equipment, but is it as reliable, fast, and cheap, and the answer seems to be no. we want to see more evidence that huawei is going to create backdoors, and they are not seeing it so far.

emily: is it a security risk? is the question. bloomberg's tom giles and ben brody, thank you for following that huawei, in. globalup, the alternative meet market is expected to skyrocket your competing with other companies like beyond meat and others next. this is bloomberg. ♪ oomberg. ♪

emily: t-mobile's closed takeover of sprint has now move forward to a vote by the federal communications commission. it is the last hurdle for the deal, you still, it can be challenged in court. some say it will reduce competition and raise prices. beyond meat has seen its share of hits in the last couple of now about concerns global growth and strength of the consumer appeared the stock

is still up, though, more than 550% since the company's ipo in may. it has helped move plant protein out of the periphery and onto supermarket shelves. the problem with beyond meat and the alternative market is that is about to get more crowded. roast is brand prime planning to roll out its "super protein" meat next year. unlike existing plant-based markets on the market, it is using fungi to create meatless options, from chicken fingers to lobster. how is this possible? joining us now, prime roo t's founder and ceo kimberly read. tell us about the size and technology behind this product. kimberly: we are creating no compromise meat and seafood alternatives. we are using an 8000-year-old japanese super food, and we grow whole food it is a

and micronutrients that you cannot find in plants. able to replicate everything ranging from lobster to be to everything in between. emily: how do you replicate it? kimberlie: the texture comes from the koji, the shape and size of animal muscle fiber. protein, they are saying you can make everything in the same kind of mushroom? kimberlie: yes, and we have made all of that. we are able to make products like no other meat alternative company in the united states, and we are building our brand on our diversity of products and bringing into the mainstream. emily: you have not launched products yet, but you are actually asking consumers to vo te on which you should launch a 2020 online. what has been the most popular?

has by farso bacon been the most popular product. emily: really? [laughter] kimberlie: ebola love bacon, and a lot of people are vegetarian e-- kimberlie: a lot of people love bacon, and a lot of people are vegetarian except for bac on. it is important for us to listen to the community. emily: what sets you apart from beyond meat, if possible food? kimberlie: the space is growing really fast. trail --king the old some are taking a culture ancessed -- some are taking ultra-processed approach, and that is a large concern for consumers and the people looking to buy these products, and we are really taking that to heart and making a product that is completely natural, not gm oh,

and naturally made. i started the company in actually grew and made all of the products in my kitchen. this is reality, and this is also food that everyone can get behind. emily: what other applications do you see of this kind of biotechnology and the future of food? kimberlie: i see, in food specifically, for our technology, the options are endless, but we are focusing on meat and seafood first, because koji has that texture. emily: and you are planning to sell this to consumers directly? kimberlie: yes. emily: rather than put it on store shelves. ? why? kimberlie: i felt like another top-down way of thinking about the consumer, so we are taking a bottom-up approach, so everything from the product building to how we are interacting with the consumer.

what we have not launched products officially yet, we have been doing a lot to build the community, and over 10,000 people have tried our products. emily: we will be waiting for that bacon to hit your shelves next year. kimberlie le, founder and ceo of prime roots, thank you. willing to do it come under what circumstances? we will discuss. and the global market selloff. as tech is sparing -- faring recession fears mount. this is bloomberg. ♪ this is bloomberg. ♪

emily: this is "bloomberg technology." back to our top story -- what delay giveth, the yield curve taketh away. both theatters worse, u.s. and u.k. yield curves in verdict for the first time since the financial crisis. here to tell us more, "bloomberg tech's" chief equity strategist. what are you reading into this and what does it mean for tech? in a we have been

correction on the s&p 500 since july. this is just an indication that the correction persists. we started talking about this last week when we had a 3% correction in the s&p 500 on monday. we were down nearly 3% again today. these type of panic days usually happen in the midst of bigger corrections of 10% or more. what that means for tech is tech unfortunately is one of the highest beta sectors and unfortunately one of the sectors china.posed to as a result, semiconductors and equipment names are going to get damaged more in a selloff. i think software names are at risk as well only because this is a place where everyone has hidden in tech. this has been a place of support, software and services. as a result, the fact they have continued to power higher this summer, they are also pretty high data, so they tend to get thrown out with the bathwater when markets are in sort of a cell now, think later mode,

which is the mode we are in now. emily: what do you think has been a bigger driver of the tech selloff -- trade fears or recession fears? >> good question. up until the last few weeks, it was really more about trade. we started to see pretty significant deterioration in theomic data overseas, and yield curve and the significant meltdown invades globally over the last couple of weeks would have suggested that this may be more about those trade concerns leading us into recession. it started with trade, and it has become this ongoing drag. trade, frankly, that's the real takeaway -- this uncertainty is going to constrain the system that has been keeping activity from accelerating and as a result, we may start to tip over into recession and i think that's what the market is most fearful of right now. will continue to follow markets as they open in asia.

thank you so much for joining us. now to a story we continue to washington targeting big tech for antitrust violations. the chair of the u.s. federal trade commission is weighing in. in an interview with bloomberg, gilles simon said his agency is ready to get down and dirty if necessary. if you have to do it, you do it. not ideal because it's very messy, but if you have to, you have to. the member that the ftc is currently investigating a's book, including its acquisitions, and an antitrust probe. that is just one of the big tech companies being targeted by the trump administration. , adiscuss in washington former member of the ftc antitrust commission. given the studio, we've got sarah frier, who covers, of course, facebook for us. what do you read into joe

simon's comments? >> it's hard to read much into it. if you have to you have to? that some was a tautology. i think he's talking about how it can be difficult to force significant divestitures, something we would call a breakup. in order to get that type of remedy at court, you need to show that it's really necessary. tautologicalf a comment, but i think that is what he means. emily: would you agree? there have been questions given that the ftc recently find facebook $5 million -- $5 billion for violations, but critics say that fine did not go far enough. do you agree that he has what it takes for the agency has what it takes to make that leap if they have to? >> i think he was really stating the fact that that is a remedy antitrust's need to consider.

i would not expect it out of joe simon considering how he handled privacy violations. $5 billion sounds like a lot, but it's not going to change anything or protect the american people from privacy violations. i do not expect to see anything aggressive coming out of the said ministry should, but these investigations take a long time. it may not be joe simon ultimately making the recommendation over what the powerful remedy is. emily: meantime, you have a new piece out in bloomberg businessweek that speaks to how facebook has evolved underscore new from regulators after this ftc.ty was levied by the >> if you think of it logically, the data is the most important part from facebook's business model. that is what is that the bedrock of the $70 billion advertising business this year. the ftc is basically telling

facebook it is very important they not share their most valuable asset with any third and facebook had already buttoned it up. i already don't want to share their data with third parties anymore. they understand that owning the network and owning a much bigger network and making that network figure is the most important thing for the future of their business. really, what the ftc did is let the company continue on its current path and have an excuse to do things that are anti-competitive like combine .ts messaging apps emily: first of all, would you agree with sarah's assessment? >> yes, i think that is a major concern, something i was hoping the ftc mike duke would be have some requirements with -- might do would be have requirements for interoperability. i think that is really important. emily: at what point do you think the ftc would say ok, this

is the company that needs to be facebook orf it's joe simon specifically spoke to amazon in particular and the issue around third-party sellers . >> it takes years of investigation before an enforcer is going to break up a company. in our history, when it has been done, it has taken time. like i said, it may very well be after the 2020 election and we could have even a different decision maker making the ultimate decision. the concern that he voiced about amazon think is also important, that it's not a love to enforce basically rules that it said it was not going to do in terms of low pricing on its third-party sellers in a different way. emily: as someone who worked at the ftc, how concerning is the amazon issue in your mind? well, the ftc certainly wants to make sure competition is

happening fairly on the amazon platform, so small retailers ought to be able to compete and not worry that amazon is going to anti-competitively interfere with them. i think that's the kind of thing the week ob looking for. ftc will be looking for. emily: plea former chief security officer at facebook had a pretty striking tweet -- the former chief security officer at facebook. he said he could not believe facebook did not pay more for this. >> he means that basically, this is a valuable asset that facebook is no longer allowed to share, so it's good for facebook to have this rule in place. the facebook of five or seven

years ago, the one that resulted in cambridge analytica, that is no longer how facebook works today. in his current world, facebook third-partynts the apps or quizzes. it wants to keep what it has built mostly for itself. emily: you just came out with a fascinating piece yesterday about how facebook contractors are listening to audio of users talking over facebook messenger, and yet, today, the story about facebook only getting stronger. i'm wondering, why don't these bad news stories seem to hurt facebook more than they do? >> i think the reason why the bad news stories don't hurt facebook is because the enforcers are not making facebook changes business practices. when they got the fine and it

was just a fraction of annual revenue and it was able to keep doing what it has been doing -- mining user data in a way they do not expect, and that is how it makes billions of dollars -- that is why that settlement was a win for facebook. until an enforcer makes them actually change their business practices in a way that affects profitability, their stocks will not be affected. emily: what is your expectation of how this ftc antitrust investigation of facebook will play out as well potential investigation into amazon you can >> of course, it's hard to predict. we do not have access to the nonpublic documents they are reviewing at the ftc, but i do think we should not expect it will lead to huge changes, as sally mentioned. the track record here is not strong on that. antitrust is actually a very narrow and difficult area of the law.

our hope is there will be a new agency with new regulatory powers in addition to antitrust, and i think that's how we really will address the power that facebook has. emily: thank you all, a story we will be covering for the next few years apparently. coming up, tencent out with disappointing revenue growth. we will discuss how china's slowdown is weighing on the company. this is bloomberg. ♪

emily: tencent reported second-quarter revenues

grappling with increasing and a broader economic slowdown. meantime, it was a busy quarter for the tech giant. barely a week went by when they were not making deals of some kind and tieups involving everything from super mario to lady gaga. spending looks at its spree. >> back in april, tencent struck stalling salese with nintendo. in may, it was one of a few chinese names that pulled the right strings with the hong kong managerial authority to win a virtual banking license. back home in shenzhen, equally bullish, sending an agreement stock exchange to work on cloud computing research, and it kept out the fountain pen to sign an zte.ith in june, it teamed up with a

singapore investment giant to invest in a start up in the u k last month, it went mobile in invest $100 million in a local streaming company. it also partnered with bmw to develop self driving cars in tona, and it said go go go pokemon. they are developing computer games to help the kitchen become -- pikachu become pika-china. it's currently tapping into the catalogs of lady gaga and taylor is notand if all that enough, sources also tell us it is planning to come back to the loan market with a bang, seeking $5 billion for banks. with so many fingers in so many pies, it's a loan is approved, there will be plenty of ways for tencent to spend the money -- if the loan is approved. emily: i want to bring in selina wang who joins us from beijing. what do investors focus on here?

seems to be a mixed bag? even the profit numbers beat expectations, the focus was really on that decline in growth in ad revenues. very promising area and we're starting to see it get hit by some of these broader macroeconomic issues in china as .ell as competition what was interesting on the call was where the company pointed ad saleslowdown in buying. this is from the auto sector, the real estate sector, the financial sector, which is not a surprise, given the string of weak economic data coming out of china. rival has been on a roll in terms of getting big companies to buy into their as -- buy into their ads as well as eyeballs.

emily: gaming has been a controversial part of the business in china. the chinese government has cracked down on the gaming industry. what have we learned about the gaming segment at tencent today. selina: for tencent, the worst is over in terms of the gaming sector, which is important given that this is the company's most important revenue line. we did the them start to monetize on some of their very important games, the new game including peacemaker a leak. for those who did not know, this is the new less toned down, less violent version of the popular battle royale game that did not get approval from chinese regulators. are expecting that to pick up later on in the year. fromentioned censorship the gaming content,

entertainment media space, they have to deal with government censors and governments have not fastapproving game titles enough. we also heard from the ceo that they will be focused on making less violent games and trying to the time by keeping a more balanced profile with these gains, especially when it comes to teenagers. as we await china's big national day, they are cracking down on what can be shown. emily: the crown jewel of tencent, sort of a super app to which there is no equivalent in the united states. how is wechat doing? >> in china, we rely on it for everything. ist is shocking is that it

definitely reaching penetration, but it is still growing. it actually group 7% -- group -- grew 7% in this most recent quarter. they are trying to introduce more services and content into the app. they are also focusing a lot of energy on the many app, apps withinlight the app. anything from booking a car to ride-hailing as well as bike sharing, so that has been an area of growth for tencent. emily: thank you so much for that update. shares of pivotal software are soaring in late u.s. trading wednesday. this after vmware and pivotal are negotiating a tentative agreement to acquire all

outstanding class a pivotal shares for $15 a piece in cash. up until now, pivotal shares had .nderperformed in 2019 still ahead, our conversation with grab's cofounder on the ride-hailing company's ambitions to become a super app. plus, how it plans to spend the big money it has raised from softbank. that's next from bloomberg. ♪

emily: is ride-hailing companies have battled it out for new turf around the globe, grab has slowly build its own empire in the southeast. won overny has softbank in asia, defeated uber in a turf war and now want to become not just an app but a super app modeled on tencent's

wechat. i asked about the company's $14 billion valuation and how they intend to put their new money to work. >> it's not just softbank. if you think about it, in fact the first $3 billion was raised from toyota, oppenheimer. we are very blessed with some of the global best names one can imagine. >> why continue to raise money rather than going to the public market? >> because of our ambitions which involve a much broader set of services for our customers. there needs to be additional innovation and additional investments. those are investments that our partners identify the , and they understand

and want to encourage us to go bigger, bolder, so we can serve southeast asia more consistently. >> tell me about your relationship. you say he has told you you can have unlimited capital from him, and yet, i assume you are probably not asking for unlimited capital. >> know, that means unlimited dilution. we are blessed to have both powerful mentor and friend and partner in this journey, but i will not right now need or want wet capital today because have enough capital to invest in what we need today. emily: you recently told me you revenued $1 billion in last year, that you are on track to double that this year. where will that come from? >> countries and regions in southeast asia. growthgest trajectory in

we have seen as indonesia and we are doubling and tripling down there as well. >> how far away is profitability? >> in certain markets, it's already profitable. for us, it's important we build and create market value. it's easy to say you are the most popular app and just be like, "oh, chill," as opposed to saying we're the most popular app, but there's lots of competitors, so we need to make sure we deliver more value so that we earn the right of customers to keep us as the single most popular ride-hailing app. emily: uber cannot say when it will be profitable and that has been a problem for investors. are you learning from that? >> it is different. the majority of their business is ride-hailing today, plus obviously for delivery.

we see ourselves as more competitor of wechat. emily: other plans to go public? >> for us, choosing long-term s, working and co-nationbuilding is when we talk about nationbuilding, it's not five months. it's the next 5, 10, 15, 20 years. grab cofounders. you can check out the episode on the wednesday night edition of "studio one point zero" regular on bloomberg television. that does it for this edition of bloomberg technology. we are live streaming on twitter . check out bloomberg technology globalsure to follow our breaking news network on tictoc.

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:: welcome to "daybreak australia." sophie: we're counting down to asia's major market opens. paul: here are the top stories we are covering at this hour. dark clouds gather over the global economy. a string of disappointed -- disappointing data flag this width that the world is headed for serious downturn.