♪ caroline: from bloomberg's will headquarters in new york -- bloomberg's world headquarters in new york. romaine: let's get you caught up on the markets right now. the russell 2000 right now about four points away from an all-time high. caroline: is it time up for big tech? on one hand, we see the starting of this rotation away from growth stocks. they were the favorites during the first wave of the pandemic.

now, the nasdaq slipping, posting the worst two days in months. adding to that, tech regulation is tightening across the globe from china to the eu and here in the united states. just today, we learned that amazon faces an antitrust complaint in europe. big tech faces a new administration in the united states. this time around, joe biden seems to have a different attitude to the last time he was in the white house. the rotation, we are seeing that from the center of the market. joe: if you look at one of the hottest areas with tech, it is some of those cloud computing names, very rate sensitive because so much of their earnings are backloaded. up until now, one of the hottest etf's all year, down over the last three days.

really, over the last two days, with the vaccine, with the rates moving up, people not willing to pay as much. caroline: the s&p 500 index valuations are phenomenal. 21.9 times future earnings. maybe with yields taking a little bit higher, only 1%. but, nevertheless, maybe this looks a little bit expensive. romaine: i think it will be not only a big talking point but a real driver here of market prices for the foreseeable future. joe: for more, we welcome bloomberg news cross asset reporter katie gry filled. two days of pretty heavy selling for the nasdaq tech stocks. but that is it, right? >> we will see. this is typically the point where other rotation has started

to die down. today was pretty solid. in the green comedy dividend. etf, the russell 2000 value etf. s islargest weighting energy, industrials, financials. some of the biggest losers this year. have growths, you and momentum, traits that have worked all year. a broad economic reopening and laggards stand to gain the most. >> the market cap type factors. when we talk about this rotation and what people are specifically flocking to, is the general sense that not only are they buying into an economic recovery

story but at the same time, about rising -- >> i think, yes. that is behind the big move in treasury yields this week. you heard from goldman sachs that they are all in on the yield curve steepening train. the calculus there is similar to the one i just described. should we get a reopening of a hopefully growth will follow. organic growth that will naturally drive rates higher. we also know that the fed will be pretty reluctant to hike rates for a long time. they have moved to that average targeting regime and they have a make upast misses to for. once inflation does hit 2%, the fed will not automatically hike. they will have to make up for first.ast misses

caroline: speaking about the nasdaq underperforming, when we return to a post pandemic lifestyle, probably relatively like the pre-pandemic one, big tech will still be a growth story. are these investors just taking a pause? are they questioning the valuations? uglierve not sort of got in a post vaccine world. >> you should see big tech continue to outperform. it is really more about the valuations. the fact that the nasdaq has had such an incredible year already. still up to the tune of about 30%. it is more that if you look at what is underperforming, the down index, it is still over 5% for the year.

there is a lot of catching up to do. that is sort of the thinking i am hearing from analysts, what has not done well this year? what has not participated in this and what does it stand to gain? romaine: you know, i found out this morning that joe weisenthal was a dinosaur truther. joe: don't say that on air > i don't think i have seen that on twitter either. caroline: he is not on twitter. he is using the rival. romaine: we will continue talking less about dinosaurs and the truth about them, as josie's it come and more about what -- as joe sees it, and more about china and tech. this is bloomberg. ♪

romaine: today, we are focused on the pressure out there on big technology companies not only in the u.s. but really around the globe. the big news today was out of the eu and amazon but china has been pushing back as well. joe: i was kind of under the impression that the u.s. would go after its own big tech giants for regulatory, antitrust reasons while china would allow theirs to flourish and get larger. bigaw the anti-ipo, the fintech's have to raise more capital. now we see that regulators may put pressure on some of the internet giant.

they be this phenomenon is going global. caroline: is there any safe space for tiktok? who knows? romaine: that is still around? joe: i saw one today. i want to bring in shery ahn, daybreak asia anchor. in the u.s., we know there is a whole range of issues, whether it is political interference, antitrust, and so forth. already regulatory concerns about some of these giants? shery: these giants take up so much of the industry. they really have spread their wings amid all of this chinese consumption. we have seen this trickle of regulations, rules, whispers of what might happen. the ipo pullback, as you

mentioned, $35 billion. just a few hours before it was supposed to start trading, it was suspended. investigatingies the music arm agreement with publishers. looking into all of these potential anticompetitive behaviors. this is nothing really new because we had seen some hints back in january. theseion of governing internet giants and restrictions involving targeting specific customers through online behavior. more updating of their laws for the internet era. usedxample, if china market and revenue share to determine who is holding a monopoly, now they will consider other facets as well such as the control of valuable information that has yet to be monetized.

romaine: as an outsider looking into the chinese economy, these were sort of companies that at least the belief is that they had help from the government in their growth. they were sort of national champions, national ambassadors for the chinese brand to the world. i am sort of confused as to why the chinese government would want to rein them in at this particular point. shery: there was hope the ipo could give a boost these new exchanges that had become sort of tech of this. of letting these entrepreneurs flourish like jack ma. we have talked about before that perhaps policymakers in beijing are feeling that they need to , these these giants

billionaires cannot go around whatever they please. not working, then we saw the ipo. this was a critical question. , that theseer entrepreneurs could flourish. for now, they are getting this public feedback on what sort of regulation they are starting to see. they have until september 30 together the feedback, then by next year, they will come out with more regulations on these internet transactions. caroline: we will get a lot of them tomorrow with singles' day. andy: the clock has turned

it is already singles' day in china. 30 minutes into the shopping $56 billion, how much merchandise. we have talked about all of concernsulatory throughout the quarter. talking aboutare china, 400 million people middle-class. a perfect --t regulatory concerns. they already added three extra days to the single day festival earlier in the month. we saw these foreign companies like nike, apple, they made millions of dollars in sales. analysthear from an

later on about what this means not only for the chinese economy but also the foreign firms that want to tap into the chinese market. joe: our thanks to shery ahn, the host of bloomberg daybreak australia and daybreak asia. coming, under a binding -- underrate bided restriction, we will discuss -- under a biden administration, we will discuss with the former chairman of the fcc. this is bloomberg. ♪

caroline: today, we are focused on the pressure on big tech. we focused on the regulation in china. in the united states, big tech could be meeting with a slightly different attitude. in the obama years, silicon ofley as a driver

innovation. a biden representative lashing out at facebook in a tweet alleging that the social media giant is shredding the fabric of our democracy in the aftermath of the election. it is interesting the bipartisan nature of these feel about big tech. joe: everyone has their gripes with big tech, whether it is sideserence, which both have problems with. romaine: you have not seen any real regulation or legislation advanced. you do have this lawsuit that was pushed just a couple of months ago. joe: joining us with more insight, in washington, the distinguished fellow at georgetown law institute for technology law and policy. before that, she was a counselor fcc.he

there is a lot of perception that the obama administration was very tight with silicon valley. as the you see relationship between facebook alphabet and so on, and the bided administration -- the biden administration? >> the obama administration was very tight with google in particular. but those were not what they are today which is extremely big, extremely powerful, and able to use that power in a way that is anticompetitive, in a way that sometimes promotes hate speech and violent speech. these companies collect so much

data from us that not only is our privacy be in compromise. you will not see the same relationship that the obama administration has with tech. i think the folks who will be working with joe biden will be much more skeptical and much more willing to act in a more regulatory power and use antitrust law, advocating restraint and antitrust law but also using antitrust law. her authority, her cloud, going after amazon and google. leading the charge here. -- it is notable that mark zuckerberg has time and again set, sure, regulate me. look at gdpr in europe, he is talking about section 230 being

reformed. >> i think the first thing that needs to happen is we need a national privacy bill. we need to confirm what they give to these companies and what they don't. i think that is job number one. job number two is we have to strengthen the antitrust laws. they essentially rendered anullity, and particularly for the tech companies, they are powerless. the google case, such a weak case. i believe that google will prevail in that case. section 230, whether they need to be modernized, again, this is the law that gives companies like google and facebook but also like reddit and yelp immunity from content that

customers post, and allows them to take down and tag content. it is a very important law. it may need some updating. that are important is that we cannot harm the small companies in an effort to go after the big companies. romaine: a lot of the proposed regulations and legislation out there would to a certain extent estimate some of the smaller companies looking to become the market and be a competitor here. how do you balance the idea of reining in big tech in a way that does not inadvertently create additional antitrust issues. >> i do think that a lot of the conversation around section 230, republicans and democrats, when you listen to them talk about

this, it is about restraining the power of these companies. to keep out certain voices. the subcommittee in the house put out a 450 page report that has help but have prescriptions for dealing with the competition problem. the question is, will republicans sign on to it? they like to complain about the companies, they say there is but will theyias, get onto the train, do antitrust law through measures, possibly structural measures like ?reaking up the company

i get is very hard to find a remedy that both parties agree upon. cases comeantitrust up every once in a while and it always seems like there is something minor. could you actually see something profound in terms of the breakup of some of these? >> people have to realize how long it takes to break up a company. it took eight years to break up at&t. it wanted to be broken up. i am not sure this is the first line of attack. the regulatory agency like fcc but for online platforms. you have these companies that are so important to the public discourse. they are used every day by billions of people around the world. why is there not a regulatory agency that oversees whether they discriminate against smaller companies are not?

that oversees some of the content moderation practices. in the united states, we have a first amendment. saygovernment cannot easily , we are making you take down this sort leave that up. democrats want platforms to take more down. republicans want them to leave more content up. but setting that aside, why don't we have a regulatory agency that oversees these incredible powerful companies? we used to have one that oversees at&t, verizon, media companies like fox and disney. caroline: when you look back your time at the fcc, do you think, we could have done some things differently? >> as far as this is concerned? no. the fcc was formed to regulate access to networks, things like

the broadcast network, the cable industry, the broadband industry. it was not intended to regulate companies like these. authorityroad fcc when it comes to regulating the things congress intended to regulate. entities thate ride on the pipes. the fcc regulates pipes, it should not regulate content. caroline: we have got to ask, how is your brand-new life, joe, going on in the new rival conservative minded platform? joe: i am trying to appeal to all audiences. no bias here. just want to talk finance, interest rates, charts, the great rotation, qqq, all that stuff. sharks, chicken, crab, crocodiles, sea turtles?

what did they all have in common? caroline: back to the dinosaur debate. meanwhile, happy birthday on bloomberg. many a year and many a year more. .oe: "bloomberg technology" ♪ are you frustrated with your weight and health?

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