emily: i'm emily chang in san francisco and this is bloomberg technology. coming up, etf's plunge amid the tech selloff -- kathy wood having her worse run in a year. tesla, square and a roku are tumbling. i will speak to kathy wood about her strategy going forward.

the global cyber crisis facing microsoft -- an attack on its exchange email software sending hackers racing to infect as many people as possible for companies can secure their systems. and the amazon backed self-driving car company says the self-driving revolution is coming, but when will it happen? we will speak to the companies ceo. we have a blockbuster lineup. it is international women's day and we will be speaking with jaclyn fuller about the jobs picture for women. but first, it was a rough day on wall street. the nasdaq 100 tumbling, ending 11% below its all-time high a month ago. for more, i want to bring in ed love the -- ed ludlow. markets not necessarily responding the way some have hoped.

ed: investors moving money out of tech stocks and into companies more closely aligned with the fortunes of the economy as the vaccine rollout picks up pace. you see that play out in the so called rotation to value. the s&p 500 down .5%, but the big drag is tech. the bank plus index, big cap stocks down and semi conductors not spared either. tesla, you nailed it, the nasdaq 100 down 11% since the february 12 he, which is a technical correction. investors are jittery about stretched valuations for tech stocks as we see yields continue to rise. i do want to look at some specific movers -- gamestop mania is back, sort of. up 40% of the day, not read it

traders driving it but the cofounder asking to move into e-commerce. the hoping to have gamestop is a brick-and-mortar business. apple down, approaching a 200 day moving average, officially in a bear market. tesla continues that terrible run with nvidia one of the biggest decliner's on the nasdaq as well. emily: walk us through how that arc innovation etf's performed. ed: they're having their worst run since a year ago when the pandemic unfolded. this is about names like tesla, one of the biggest in that etf. really closely aligned with the na which is interesting. but come into my bloomberg and look at this chart because that is not the whole picture. the etf is down 11%, but it is

up more than 200% since its march 2020 low. the intense inflows the etf saw, that bad performance in terms of price declines came on the back of a historic winning streak which attracted billions of dollars of investment and inflows. plenty of those investors seem to be sticking around and histories show those who bet against cathie wood don't tend to do particular well. emily: let's continue writing those history books. with more on the volatility the market is seeing right now, we have the founder and cio of arc investment management. it has been a while. good to have you back with us. clearly you are feeling a fresh round of pain right now. what is your strategy? what are you buying and what are you selling? cathie: we keep our eye on the price. we have a five-year time horizon and when we go through a route

like this, a rotation now is happening very quickly. it started off slowly and is happening quickly -- but i am happy the market is broadening out. this was the close -- this was the case in late 16 as well. value took off and left growth behind. whenever i see that happen, i say this bull market has rotted out. i would say concentrate our portfolios with the highest conviction name. we've extended the number of gains in the portfolio from the low to mid 30's at the bottom of the coronavirus and we are at roughly 55 for our flagship funds. we are starting to sell more liquid names and buy some of the more pure play names. the more liquid names are either more mature, facebook, apple and so forth.

or -- and -- or they are participating in innovation but not pure place. ray general and, novartis and so forth. more liquid in order to have cash like instruments to use at a time like now and move and concentrate toward our highest conviction names. let's -- emily: are you going to continue to buy the tesla dip even though it is dipping lower? cathie: yes. we can buy a stock up to 10% of our portfolios. certainly with etf's, we report our holdings at the end of every day. and we have been building whenever we can. we built up to 10% last week and the stock behaved in line with our portfolio, so we can't buy anymore here.

if it were to deteriorate at a rate beyond that of our other portfolio, drop below that 10%, we would have the latitude to buy more. emily: you said you are going to put out a new tesla price target. when we going to see that and can you give us an idea what the target will be? cathie: i'm going to say in a couple of weeks. they are getting compliance help us cross our tees and. our i's before we send it out. the two things since our last projections, it has increased its market share. when we put out our original $4000 price target, the equivalent of $800 now, we thought tesla shares would drop

from 17% from a share of the global electric vehicle market from 17% than to 11%. instead, it's share increased as others with wonderful brand names started increasing the number of electric vehicles in their companies. that was a big wake-up. in the united states, tesla through the third quarter was still 80% of all electric vehicles sold in the united states. so pretty stunning. second thing that has happened is autonomous. the probability tesla gets autonomous right we believe has increased from the 30% we had in our base case in our last model.

what's interesting about autonomous is the margins in autonomous, the gross margins are in the 80% range. the margins for electric vehicles alone are in the 25% to 30% range. this is a five-year projection. so the model changes completely if tesla gets autonomous right and we think it will. emily: art came back even stronger after the big pandemic, but we seem to be in a totally different environment. right now, it seems to be happening because of rising yields. how do you come back even stronger this time? cathie: truth wins out. we know our focus on disruptive innovation, we are focused on five platforms involving 14 technologies, all of which are moving into exponential growth trajectories.

beyond that, many of these technologies are converging. so autonomous taxi networks are comprised of three platforms -- robotics, autonomous vehicles -- they will be electric -- electric is going to be the cheapest way to go, and artificial intelligence. they will be powered by artificial intelligence. those are three s-curve's coming together and we think they are going to cause explosive and highly profitable growth. i don't think most research departments are set up to focus on innovation this way. they are silent and specialize. we are focused on platforms and they are focused on sectors. we are focused on the 14 different technologies associated with those platforms. these s curves are going to collide and create so much positive energy that we think traditional analysts are going

to be gob smacked five how powerful these are going to be. what is your relationship with elon musk? what kinds of conversations have you had? any fun and crazy stories? cathie: we did our podcast. the way we do our research -- we don't want any special treatment but we have a five-year horizon. so we are asking more technology questions about anything in the short-term. so as the stock was cascading downward, we had a fantastic -- we had a fantastic podcast with elon. that podcast is evergreen because we are talking about long-term time horizons and you will see how brilliant and focused he is on tesla.

we did talk about the crypto decision, the decision to put some cash into crypto. we were fully supportive of that. any company on the right side of change should diversify in that way. emily: should he keep diversifying or is $1.5 billion enough? cathie: i will leave that to their judgment. i know that they keep enough cash on their balance sheet to support their operations and i think with the focus on their cash, they are not going to do anything wild and crazy. emily: we are going to take a quick commercial break. cathie wood, arc invest founder ceo and cio. a lot more to come as the selloff continues with not just tesla but square and roku taking a hit. cathie wood will be back with us

next.

emily: the tech selloff continuing with tesla, square, and roku taking a hit. those are the largest holdings in arc etf's. tesla down 30%, but cathie wood said she's not concerned. the founder and ceo and cio of arc investment management. you've been coming on this show for years. in that time, your popularity has exploded. you've got your own line of arc merchandise, the media loves talking to you and about you. they've called you the antiwar and buffet. how do you feel about not being just an investor but a celebrity

investor? cathie: i don't think of myself that way. i think of sitting down every day with analysts and inking about being excited about the way the world is going to work and wanting to share that with people. from an educational point of view, to help people understand how radically the world is going to change and how it is so important to stay on the right side of change. i'm not talking about just portfolios, i'm talking about parents and grandparents guiding their children and grandchildren to the right side of change. that is how radically we think the world is going to transform. when we go through a rotation in the market like this, i think the bull market is broadening out, but be careful. this rotation into value, make sure you understand whether these companies are primed to

move into this new world or if they are going to be disruptive. we think energy and financial services which are the two best performing services this year. i think it's 37%. we think they are going to be some of the most disruptive sectors of all. given electric vehicles, autonomous electric vehicles and digital wallets. my work is really charged up, saying it's a beautiful day, let's share the news. emily: do you ever worry the rising retail interest in your funds could have negative consequences given how quickly and powerfully we've seen retail investors move the markets and the last few weeks? cathie: i did a youtube video. we are starting to do them

regularly now that the markets are unsettled. in the last one, i predicted the difference between retail and institutional investors. we are much more embraced by the retail investor. the retail investor has seen the future before institutional investors because post tech and telecom crash and post 2008, 2009 meltdown, institutions have been forced to track their benchmarks more closely or they have chosen to. that is longer term a losing proposition and very backward looking. we have found some of our strongest holders to be retail investors because they are keeping their eye on the prize. they know the world is changing and they are making the change. we are having redemptions, we are surprised at how low our redemptions have been.

emily: you have not traditionally seen outflows like you've seen over the last few days and weeks. how loyal do you think your investors are? how sticky is your model? cathie: i think they are paying attention to our research, we are going to have a market update tomorrow. if they ask us questions and understand the depths of our research and they learn they want to keep their eye on the prize as well. so what do you do in a time like this? you buy low and you take profits, sell high. but not sell out, trade around positions and that's what we are seeing them do and i think that has been healthy but frankly, as you will see in our holdings at the end of every day, we are averaging in, using this time to average into one of the most important --

emily: i'm curious if you think that is part of your secret and if you are hiring, who you are hiring? cathie: diverse points of view are critical. that has helped us without a doubt. and yes, we are hiring, we are looking for another asian innovation analyst and perhaps another next-generation internet analyst. we are hiring and we have to fill in as well, management positions to get operations to scale the way we would like them to scale. so we are excited about the talent that is self-selecting.

i have been thrilled and i wish more women would self select. that has been my big surprise. in the early days, women self-selected all the time and now that we hit our stride, i'm seeing fewer women. so i'm going to put that call out there and say we would love to interview more women. those who are interested in innovation and really understand because they have domain expertise either from a or industry, really understand and are excited about the way the world is going to work. emily: given these new investors coming into the market, with the increased retention, do you have concerns that there are all of these shiny new objects competing for retail attention?

how long do you think this correction will last? cathie: on the first topic, i don't think anyone is doing the kind of research we are. that buttresses the firm and portfolios. i am glad there is more capital moving into an ovation. it may not be as ours is, building models, five and six years worth of models. but i do think allocating capital toward it is the right thing to do. there's so much innovation taking place. the u.s., to keep competitive, we must invest in innovation and for another reason -- how are we going to get out of the coronavirus crisis?

many people would say tax, cut spending. our point of view is with the exponential growth opportunities ahead of us, we could grow out of a lot of our problems. i think our social media, social marketing and social distribution strategies are giving us a competitive advantage. most marketing and media around our research. in terms of how long will this correction involve? we believe growth is going to be explosive here. we believe value and growth will do very well. value has been more depressed. we understand that rotation, but we know there are minefields in value.

earnings, with each orderly earnings report, we will have more reasons to buy this market. emily: cathie wood good to have you back. we will keep on watching. we are just moments away from speaking to s.e.c. acting chairwoman and we will talk about the massive microsoft hack, the future of 5g and more. this is bloomberg. ♪

emily: an attack on microsoft's widely used business email software is warping into a cybersecurity crisis. it started with a chinese government backpacking group. the number of victims has already hit 60,000 according to a senior u.s. official with knowledge of the investigation. the white house is winning companies to take the threat

very seriously. we are going to act -- we are going to ask the fcc acting chairwoman on her reaction and how she plans to shape the commission going forward. jessica rosenworcel is with us next. this is bloomberg. ♪

emily: welcome back to bloomberg technology. i'm emily chang in san francisco. newly discovered flaws in microsoft software for emails have raised concerns at the highest levels of the u.s. government. at least 60 organizations globally, many appear to be small and medium-sized businesses have been hacked via the company's software by suspected chinese hackers. by suspected russian cyber attackers. joining us now is fcc acting

chair jessica rosenworcel. i know cyber is not square in your purview. but cyberattacks are on the rise and you closely follow technology. i'm curious if there's anything the fcc might take on to make sure our networks are more secure and resilient? jessica: cybersecurity is really an important part of our national and economic security and the risk we face -- risks we face are only growing. governments from the fcc on up is going to have to work closer with private industry to make sure we have the tools to address these challenges because they are not going away and this is just a demonstration of that. emily: how will the biden administration start a new chapter for the fcc? what will change? jessica: i think what has changed a lot in washington is

the recognition that broadband is no longer nice to have, it is need to have for everyone, everywhere. this pandemic has demonstrated that with an full clarity because we've all been told to go home, work if you can online, go to school online, have your doctors appointments online. nobody's got a fair shot in this country if they don't have internet access. we have to figure out how to make sure access gets to every household and where they live -- no matter where they live. emily: the ruling on net neutrality was perhaps the most controversial ruling out of the fcc. you are on the record opposing the rollback. would you propose the fcc reimposed net neutrality? jessica: you are absolutely right. i opposed the last minute -- last administration's rollout of

the net neutrality rule. there is a short-term and a long-term and the news out of california. when the fcc stepped out of net neutrality, fate -- states stepped in like california. two weeks ago, a judge in california zone net neutrality policy can now go into effect. that is big news. but in the long term, we need a national policy on this issue. that's something i intend to work with. i think net neutrality should be the law of the land. emily: i'm still at home, i believe you might still be at home. it's a good time to check in on america's broadband policy and what you are doing to close the digital divide.

you have kids who have been home for over a year. what's it going to be like as we start to come back online and how concerned are you about folks who may have been left behind? jessica: we have a digitally disconnected population in this country. so i'm proud of what the fcc did about a week ago. they did something called the emergency broadband benefit. it's our nation's largest effort at broadband affordability in our history. we set aside $3.2 billion. congress helped us do that to make sure low income households could get online. the support is $50 a month for those households so that people who have experienced job loss and applied for unemployment insurance or on medicaid or have pell grant's are not going to lose access to the world online during this crisis.

i think it is important we build programs like this because we don't solve our nation's digital divide without having programs that address this affordability. this emergency broadband benefit is a big one. i'm proud of the effort we made and i expect it will be available in a few short weeks. emily: if confirmed, you would be the first woman to permanently lead the fcc. we are all watching your future very closely. what kind of conversations have you had with the white house? are you going to be the chair of the fcc? jessica: that's above my pay grade, but i am doing my best. it's a privilege and honor to lead the federal communications commission and communication, technology is keeping us connected in this crisis. it is really important. emily: there are a lot of women

and young girls who are concerned about backsliding, concerned about being left behind in this pandemic, especially if they did not have that digital access. how much of a priority will that be for you? jessica: we've got to figure out how to get everyone online everywhere and we've got to start using every tool we have in washington to make it happen. that is something i'm working on at the fcc and there are students who fall into this homework cap have internet access at home but are locked out of the virtual classroom. congress is looking at legislation to help with that problem. i think we have a lot of progress we will see in the next few months and i'm excited to be leading it. emily: the fcc ruled that spacex is eligible for subsidies for supplying broadband service from its slate of satellites. the satellites are already

aloft. i'm curious if you think this is a good use of public subsidy and when the fcc will complete this review of whether it is funding spacex and some of these proposed recipients? jessica: it's a preliminary decision we are looking at right now. the bigger point is we need to start addressing these issues of the disconnect and using new technologies. it has always been that we only reach fiber facilities on the ground and i think we have to be open to new technologies like six wireless and low-earth orbit inc. satellites because some of those new technologies can deliver really high speeds at lower latency than in the past. and i think we can get a lot of people more connected in rural areas a lot faster if we can open ourselves to some of those opportunities like you described. emily: at the moment, the

commission's two and two democrats versus republicans. you talked about broadband, working on 5g, what will you be able to accomplish with a democratic majority? jessica: on the 5g front, i don't think this issue is partisan. a good 5g plan involves both spectrum and security. i'm working really hard with my colleagues to bring more mid band spectrum to market and the carriers have the airwaves they need to deploy. we are working really hard to make sure our nations networks don't have vulnerable foreign equipment in them that could open us up to surveillance problems. we are working on spectrum insecurity and i hope we can do both regardless of the makeup of

the committee. emily: jessica rosenworcel. thank you so much for joining us. coming up, google launches a new challenge worth $25 million to tackle gender inequity around the world. we are going to speak to jacqueline fuller about their latest efforts to empower women economically, next. this is bloomberg. ♪

emily: google.org is giving 25

million dollars to support global nonprofit and social organizations creating programs to advance economic empowerment for women and girls. the winners of the impact challenge will receive grants and mentorship from google as president biden creates a gender balance commission. it's part of our work shifting conversation today. starting us out as jacqueline fuller, president at google.org. talk to us about the challenge and what's in it for the winners . jacquelline: i've been at google for more than a decade and i am so excited about this. it's my favorite ink that we have done. it is an open call, the google impact challenge for women and girls. we are going to provide expertise from our googles 4 --

and we are looking at creating pathways to prosperity for women and girls around economic empowerment. it is open now on our site. the deadline is april 9. criteria wise, we are looking for innovations. we want really bold ideas and we want to make sure the teams have strong capacity, locally represented, and ideas that can scale and have evidence of impact. emily: president biden just created a gender policy council at the white house. what is your reaction to that? jacquelline: all that is needed in this moment for women and girls. as you know so well, we've been making such amazing progress for women and girls in education and jobs, but the covid crisis has

really set us back. we have seen women disproportionately impacted and that is true globally. they are more than twice as likely to have lost their jobs. here in the u.s. and around the world, we see women needing to take on extra duties at home, whether that is teaching kids or taking care of aging parents. we see about 10 to 15 hours more work per week women are spending on caregiving and children have had to leave school globally. we know that's happening around the world. but there are estimates that 20 million girls may not return to school after the pandemic. so this is a moment for all of us, government, civil society, individuals, to stand up and help women and girls along the economic pathway. emily: i am glad you mentioned

that because i'm concerned about women backsliding, especially as i am listening to my kids shuffle around upstairs while i talk to you from my basement. what kinds of policies do you think are necessary to get women back into the workforce, to make sure we don't move backwards and only move forward? jacquelline: here's something that is very positive. we know there are pragmatic solutions that actually work. one of them is thinking about reskilling. through the program we are helping with, we are training more than 20 million people globally and we know when people have access to these skills, they can help advance their careers. we are launching things like i.t. support to help people who have never even touched a computer get into that wrong of the ladder into tech careers. the good news is there are

solutions out there. one of the things we need to see, let me speak to my world of philanthropy, we need to make sure there's more philanthropy going to support specifically women and girls. it's only one or 2% of philanthropy is tailored to closing gaps and solutions for women and girls. we need to get more delicate -- more dedicated philanthropic old -- philanthropic capital that can help push innovation. we need to see more women in leadership and decision-making and frankly deciding where that money is going in philanthropy. it is one of these fields where we see three quarters of the staff in philanthropy is female but only half of ceos. if you look at the largest philanthropies, only 25% are led by women.

emily: a really important statistic there. i always like to lean back on the numbers. inc. you for stopping by. we will follow that challenge and how it plays out. coming up, the self-driving revolution is upon us according to an amazon backed self-driving solution. i will speak to the ceo, next.

emily: zook, the self-driving company backed by amazon has high hopes for the future of autonomous cars. the company made headlines when they announce their self-driving all electric taxi designed for cities and roadways. amazon bought it in what's reported to be its largest investment yet in self-driving car technology.

joining me now is the ceo. it's been quite a year since you sold to amazon. what has it been like being under the amazon umbrella over the last few months? guest: thank you for having me. it has been great. it has been about six months or so and our mission is intact. it's nice to not be fundraising out there and we are learning a lot from amazon, so it has been really great. emily: you been building these autonomous shuttles. how many have you built? are you testing them in the wild yet? aicha: we felt a little over 10 and we are testing them in cities, private roads and tracks.

emily: what is the vision here? aicha: division is reinventing personal transportation, making it cleaner, safer and more enjoyable for everyone. it's important to note our business model is we don't sell you a vehicle, we sell you a ride and in a dense, urban environment, that makes a lot of sense. the technology is fully autonomous because you have an app and you say i want to go from point a to point b. it shows up, sliding doors, you buckle up and you have a screen that has your temperature and your music and you arrive at your destination. then you stepped out and pick up the new passenger, so we are constantly moving around and when i'm not using it, someone else is using it. it's mobility on demand enabled by a fleet of electric and

autonomous vehicles and you don't have to worry about charging, maintenance, any of that. you just get the benefit of rides. emily: how far away from this becoming reality? when might we see you launch a commercial service? aicha: we are testing in san francisco and las vegas. so i think we will be in those places. we don't have any specific announcements at this point in time, but it's not next year for sure, but it's sooner than people imagine. this is an inflection point in transportation. it's the getting of the way and it is something that's going to change how cities develop how we move around and it is going to unlock a lot of opportunities. not next year, but sooner than people realize. emily: will you be delivering amazon packages? what's going to be the relationship or will there be a connection to amazon when the service launches?

aicha: the way we like to put it is this is a multi trillion dollar opportunity and moving people is the foundation for us. we will concede that once we are good and safe in terms of moving people and we scale that, i think it is fair to assume we can move packages. first we will move you and then we will move your packages a bit later. emily: it is international women's day and you have been breaking barriers in a white, male dominated industry for a long time now. i'm curious how important you think it is to have diverse perspectives in the room when you're building a company and a product as important as a self-driving car? aicha: i think it's important in all industries. women are half the population half the customers, half the consumers. diversity of thought and being inquisitive is one of the most important things.

it makes the product better. we were just talking about this this morning. when i arrived, we were having a discussion about pickup and drop-off. the pandemic notwithstanding and what have you -- occasionally, i like to go on the town like everyone else and put my high heels on for a dinner date or something. i don't want to be walking too far on those high heel shoes. the truth is they hurt and just being in that room and having that conversation, there are multiple examples. if you want to be there and provide value to customers, one cannot ignore half the population. emily: amen to that. if you can shorten the amount of times i have two wear high heels but give me the chance to put them on, i am all for it. i'm curious how much time you spent with jeff bezos and what kind of a leash, how long police

she's given you in terms of additional funding, like what could be coming down the pike? you are still an independently operated company. could we see an ipo? aicha: lots of questions in there. we've spent reasonable amount of time with the leadership at amazon. they've been very helpful. i don't know about a leash. that's not the basis of our relationship. amazon is one of the few high-tech companies that has been able to create value. we are bold -- they are bold and visionary and we are learning a lot from them. needless to say, i'm enjoying not having to fund raise on the open market anymore and we have the capital required to go forward. emily: fascinating to hear about your progress. the ceo of zoox.

we will watch how it unfolds on the road. that is it for this edition of bloomberg technology on a very special international women's day. we will have a lot more conversations about race, gender , and diversity at our bloomberg equality summit starting next week, march 16. i will be speaking to melinda gates, cochair of the bill and melinda gates foundation. we will be talking about the philanthropy that goes toward women and girls and other very important topics as well as how women are faring in the pandemic in general. excited for that one and thanks for watching this special edition of bloomberg attack. this is bloomberg. ♪

haidi: good morning. we are counting down to the major market opens. shery: welcome to daybreak asia. haidi: tech is in the spotlight as asia opens. the tumble on wall street drags that nasdaq 11% below its all-time high. new measures -- u.s. bank leaders say they will strengthen legal defenses against