caroline: i am caroline hyde,

and we are at bloomberg's headquarters in new york. ed: and i am ed ludlow in san francisco. this is "bloomberg technology." >> the u.s. dealmakers raising to get tech transactions across the line. >> it could be a huge win for the biden administration to push beijing access to the chip industry. there are curbs on china. >> the unorthodox leadership styles of elon musk and sam bankman-fried. we explained why it is bad for business. let's check the markets. we see sentiment a little bit buoyant. we see data for central bank action. s&p 500 up 1.4%. the nasdaq up 1.2%. a little optimism around the cpi print, the inflation data coming

out tomorrow. last month, it injected fire into the risk-on of traders. and there is a desire to get ahead in the market before this number. the 10 year yield with yields pushing higher. it is interesting to see tech move higher. the reason the 10 year treasury option, -- option the last sale , in the end of the year -- maybe people not wanting to go long duration ahead of the cpi number and the fed anticipating a raise in rates this week. let's look at in terms of currencies, the dollar is sticking higher on the day. bitcoin over the last 12 trading days in a range. and cumberland saying do not expect this to change, but next year amid these concerns, when we look at the hearings at the house and senate and with ftx,

we may have some sprinkling come in. ed: when it comes to oracle, we have a strong top-of-the-line in the second quarter. they said the numbers would be even better if it was not for the strong dollar impacting revenues outside of u.s. the stock is higher by 2.4%. it's a risk on move. there is one that jumps out at us, which is tesla down at a three-week low. 6.3% in this session. we will get later into the reasons behind that. and you mentioned some of the names we've been tracking. coupa software up 26% today and looking to buy a company. and amgen in a deal that's

looking into therapeutics. so much news breaking when it comes to ma. caroline: not to mention the market change. it has been a whirlwind getting into the week of m&a space. there's $70 billion and a rush before the holiday. let's talk with katie. talk us through the reasoning behind the flurry of deals. katie: we see a lot of deals happening before the end of the year. sometimes there is an eagerness to wrap things up over the holidays. people do not want deals to die before the holidays. we had been reporting on the coupa situation for a while. our understanding was that they were in talks for months.

it finally got done. this was a wave of take privates this year. and with the amgen situation. there had been a bidding war. one of them backed out yesterday. late last night, we broke the story that they came through and made an offer. this is quite the merger monday. you may have mentioned that microsoft took a stake in the london stock exchange. ed: it's an interesting time of year for this to happen. coupa 77% premium, which is over the price from the date as you guys first reported that. it's an interesting development. a lot has happened in 48 hours. it's a sprint to finish the year. how does that set us up for 2023? i know there were other deals we are tracking.

katie: absolutely, we are expecting, from what we hear from dealmakers, 2023 will be active on the m&a front. especially with tech. observers of the stock market have noticed that tech stocks are down substantially. it took a while for sellers and buyers to agree on price, especially with volatility. people are expecting at this point, tech companies less likely to be in denial of what they are worth. it is a good time for buyers to buy things on the cheap. ed: katie is never in one place. it is no wonder she is able to keep this all in her mind. we have so much more to discuss and thank you very much. let's discuss this more with robert profusek, who is at jones day.

we have merger monday. why is that happening now? >> 2022 is down compared to 2021. 2021 was $5 trillion, it was just fabulous. one of the things that happens with a market correction is that it takes time for buyers and sellers to figure out what what is the real number. what am i really worth? a famous quote is 'you are what your record says you are.' in wall street terms, that means the market dictates your worth to that point in time. it is hard to adjust. the amgen deal was interesting, almost at an all-time high for the target rise. it's not surprising it is difficult to get to a deal. they were trading at four times valuation months ago.

they have two issues that are happening in the circumstances, one of them is dislocation of value. what is it really worth? things are starting to settle out maybe. in terms of what the markets have to say. caroline: with all your years of experience, what from a macro perspective do they want to see? is a calm this -- calmness when it comes to over volatility? with the discussions you have with people that want to use the huge amount of cash they want to put to work, what do they want to

>> stability. one of the things this matches 2022 the most recent period is can more stuff happen? in a short period of time we've been through. i mentioned earlier we went through 12 years of quiet interest rates. nothing going on in the environment. and suddenly the debate is the 10 year going to 550 or 600. how does that happen? part of it is just stability. and when you think about it from amgen's point of view, horizon, i am not an expert on this, but i understand they have great drugs and amgen like every other pharma always has to replenish itself. they have a powerful balance sheet. and they got a bridge loan for the deal for $28 billion.

this is in the same market where people say you cannot borrow money. well, it's not that everybody cannot. some people can but not everybody can. but they could in 2021. it's going to be a more fundamental market rather than a financial market. there is a tremendous amount of private equity that was raised in the last several years. literally trillions of dollars. that has to be put to use because of the way the economics work. they do deals that they think are good deals but there is some pressure to get the money applied. caroline: some companies in the technology and biotech space also have a lot of money. they are keen to do deals, but the regulators, we were talking last week, the prominence of the ftc everywhere looking at what meta has been doing and what microsoft is buying in the gaming space, how much is regulation worth it to you?

-- regulation a worry? >> it is a factor. certainly the microsoft and activision deal. and simon & schuster which is a smaller deal but it's important in some way in terms of what it says. but that deal was blown out by antitrust treasuries. but on the other hand the track record has not been too good. unitedhealth, alumina, the sugar deal, a lot of things. just because they moved to block a deal does not mean it will be blocked. this administration is taking an aggressive view of this. in all candor, i'm not sure that it's all that more aggressively done than the trump administration.

it is just a factor. the microsoft deal, i know people were acting like that was surprising, i would have been surprised if they said ok it is microsoft after all. you have to take a look at it. do they have to sue? i don't know. i do not think that has really changed. there is a little bit more rhetoric. ed: we were talking about the big names out there going shopping because they see opportunity. the other side of the table there are those that are the for -- under duress. when we think about the market right now in the market 2023, what role does the for seller play in global activity? >> usually, it is when things bottom. it is the for sellers that start the level of activity. usually it is because of overleveraged. that will not be the case this time. it is just a function of the world we have lived in over the last several years.

there was equity available at very aggressive prices. the public markets are absolutely close for that sort of stuff and the private markets are difficult. not like they were. a lot of businesses were financed based on the assumption that equity could be there. it will not be there and they cannot borrow money until they start opening. so there will be a lot of merging. they are going to have to be a lot of activity because some companies are going to get close to running out of money. and they have to pay the bills. ed: we will see if that happens. thank you for joining us.

coming up, a potential win for for the u.s. in its quest to loosen in china's access to chipmaking technologies. this is bloomberg. ♪

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japan and the netherlands may join the u.s. in tightening chip exports to china. that is a potential blow to beijing's technology industry. the two countries say that they

would at least adopt some of the measures that the u.s. rolled out in october. they are considering curbs on chipmaking equipment. and i want to get straight to whether that helps the u.s. reach the result it is aiming for. it says it is aiming to stop the chinese government from having access for equipment that they could use for military use. you can use some of those chips in military functions. does this actually get the result that the u.s. is pushing for? >> it depends on what you're doing. there are military applications that are using older generation

chips. by limiting the access, you will limit access that is higher performance, especially on the compute side of things. that is where you will see advanced logic. this will prevent those chips in principal from getting into the military. caroline: meanwhilem china's dispute over the export for the wto. ultimately, how damaging is this to beijing production of chips? >> it is damaging. it will stop them from developing their own ecosystem to design, manufacture, and build semiconductors. they are not prevented from developing the capability to build older generation parts, they can do that, but anything that can be used for computing

even from a design side or manufacturing side we want to stop them. it will be difficult if not impossible for them to build from a local standpoint. with these new blockades from the netherlands and japan, they finally close the window on it. if all of it comes together, with the u.s., there's not a whole lot that china can do from i -- a global standpoint. ed: the reason we are tracking these three countries is because of the companies. a small group of key players. kla, asml, what is your assessment of what these curbs are doing to impact those companies top and bottom lines? >> it is important to remember, wired -- why are they doing this.

why do we care about the netherlands and demand? -- japan? china can not make the most productive semiconductors that has already been banned. if you go a couple generations back it is still pretty advanced. there are alternatives to u.s. companies. you can get an alternative for companies like nikon in japan. and get alternatives like tokyo electron. that is why it is important to get everybody on the same page. in terms of the impact on the companies, the u.s. emphasize this, there's only a few of them that are impacted on the product side. for now they are closing the gap. there is $2.5 billion a year with asml. it is important to remember from

an equipment side, it may get less overtime because you figure if the capacity is needed, and it is not being built in china, eventually it may be built somewhere else. so this is made out to be somewhat temporary. and they may find that some of the capacity is not permanently lost. but it may take time and regenerating supply chains to get it moving. ed: you're right about this research. we had dug messenger on the show a couple weeks ago that pointed out that there are workarounds essentially in terms of licensing alternate products. will china have success pushing those alternatives? >> the sanctions on those are targeted about what is and what is not and. -- not banned. i may use the

chip to make several things. there is a judgment call on how this stuff gets supply. so the general characteristics what is banned and what is not as fairly cut and dried. the modern companies like nvidia, it is not concerned with actual chips. they have had alternative products that come in below the threshold. and now they can sell those. the issue is that they will never rise so the gap between what is legal of what they sell in china and what is available in the rest of the world will get bigger and bigger. eventually, they may no longer be suitable.

caroline: thank you. meanwhile, coming up, we will go on the record there are so many outlets with sam bankman-fried on social media or other parts of the media. not scheduled to attend a panel hearing on the ftx collapse wednesday. we will discuss why coming up. this is bloomberg. ♪

ed: ticketmaster apologizes again. this time it involves bad bunny. hundreds of fans who bought tickets were turned away from the concert in mexico city on friday because security thought

the tickets were fake. this is after ticketmaster said its system had been overwhelmed with an impressive number of people with fake tickets. over the weekend, they said fans with legitimate tickets would be refunded. and they asked ticket master for a report on what is happening. a little bit of deja vu there. caroline: a little bit. sam bankman-fried is still on his apology tour. it is across social media outlets such as twitter. it is a heated spaces debate. we test out spaces where we want to conduct our conversation and bring in an audience. but what stood out for me, the fact that we are getting our news from twitter spaces. this idea of citizen journalism is coming to a four and it is

spearheaded by crypto. ed: and you mentioned sbf. why will he go or not go before congress on capitol hill when you can get all the information from him live on a social media platform. i think that is the frustration lawmakers have as well. caroline: a lot of people have been critical of lawmakers when it comes to the understanding of social media. but what about their understanding of crypto as well and people asking questions on the twitter spaces. ed: our expert will walk us through it later on in the show.

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caroline: welcome back to bloomberg technology.

en caroline hyde in new york with ed ludlow in san francisco. tech stocks were pushing higher, the nasdaq 100 was up a bit. let's talk about one name that is languishing at the moment. ed: is tesla and it is hard to understand why. there is no specific news driver, at least not this monday. the stock trading at a three-week low. there are a lot of headlines where we talked about the pullback in production in shanghai, the bloomberg news report that elon musk is considering switching some of the unsecured debt for margin loans in his financing. of the twitter deal which would be backed by tesla stock, that could be bringing downward pressure. then there is what elon musk himself is saying on twitter, his actions over the weekend. i want to bring up this chart and get into some technicals. we don't often do this, from its 2021 high there is a clear downward channel trend for tesla stock, or on multiple occasions

it has tested key levels of support but it still continues this downward slide. it is really hard to pick out why. a lot of analysts don't necessarily agree on what is supporting or not supporting the stock as the case may be. when we have reported on questions about demand from china, a lot of tesla retailers push back and said that can't be the case. we have also reported tesla has cut prices. we will get into it with our guests, but how much is it just elon musk? is there a key man risk element, or a distraction element? caroline: we want to dig in to elon musk management style more with someone who has built businesses. i'm talking about arianna huffington. she says elon musk's business style is an example of core business strategy after she told employees to emplace hard-core.

in an op-ed she said helping corporate culture is an essential part of strategy, productivity and retention. she called musk a burnout denier. she has a thrive global campaign signed by over a hundred companies. arianna huffington is with us now. you write that elon musk is a case study for leadership, how is he such a powerful counter case study? arianna: at the very moment when we have major multinational companies like pfizer, accenture, salesforce and walmart investing in employee mental health and seeing the business results in terms of recruitment, retention and productivity. we have elon musk who is a genius when it comes to understanding energy and cars. clearly not understanding human energy.

and expecting his employees to act as though burnout leads to people performance and great business results. we see that it does not. we see a chaotic process of decision-making which clearly is not benefiting twitter. and it is obviously not benefiting tesla, because to ed's point about white is tesla stock down, there is no question that elon musk is the genius behind tesla. when that genius is distracted by auctioning espresso machines on twitter, and moving beds into conference rooms, and trolling foundry on twitter. if i were an investor in tesla, i would be worried about weiss and he focusing on tesla especially at a time of growing competition. caroline: what is interesting is this hero status of sleeping in the office.

sam bankman-fried we are about to talk about in terms of crypto wealth falling asleep on beanbags, they want to show the potential vcs how dynamic and focused he is the minute he wakes up and comes to give you a pitch. when can we stop having this idea of cultish fanaticism around certain people and doing it all with two hours of sleep? arianna: actually the majority of the world has stopped, that is what is fascinating especially because of the pandemic. we went from sleep deprivation, exhaustion at work being a badge of honor to the opposite. we have major ceos now talking about getting eight hours of sleep. we have major elite athletes like lebron james, tom brady and roger federer talking about the importance of recovery for peak

performance. all these people are very hard-working. this is not about not working hard, this is about working smarter, and not having the diminishing returns we have experienced when we are running on mt. so -- running on empty. that is what i find fascinating because i am a big admirer of elon musk, he is unquestionably a genius. somebody who understands it so perfectly energy, renewable energy when it comes to cars, is actually using incredibly outdated modes of human energy when it comes to how he wants to run his businesses. ed: is elon musk not just going back to his playbook? i want to bring up something in your op-ed that he is showing the downsides of a model fueled by burnout and lack of sleep in

his own decision-making. that may be think about reporting from 20 when musk said he was -- from 2018 when musk said he was sleeping on the production line with his engineers. he does have a good track record of getting companies, be it tesla or space x, through moments of duress. those two companies now are the clear market incumbents for both electric vehicles and commercial space launch. arianna: two things have happened. one, the culture has moved on. the pandemic has dramatically accelerated the cultural shift away from celebrating, as caroline was saying, burnout, and wearing it as a badge of success. when elon musk asked his twitter employees to come in to a hard-core intense way of working, 1200 resigned. that would not have happened in 2018. what happened with the pandemic

was people looked at their lives, and what do they value, and millions said they value hardware. we value being completely engaged by our work, but we also don't want to be defined by our work. we want to also prioritize our own health and well-being. so that's the moment we are in right now. and i have no doubt that if elon musk started applying that scientific, clear data around how to best work and achieve business results, he would be even more phenomenally amazing across all his companies. ed: you've been a board member and an executive and leader in a number of companies in technology and media, give me some concrete proposals elon musk should put into play to fix the situation at twitter. to improve performance at tesla.

what advice would you give him then to change what has been the case so far? arianna: the first is along the lines of what we're discussing, recognizing that he's got to make better decisions when he is not running on empty. when he not exhausted. ed: getting a good nights sleep in other words. arianna: you work hard, caroline works hard, that is table stakes . but we know that our work depends on judgment. and his work and what he does for his companies depends on the quality of his decisions. and the quality of his decisions has not been good. there has been so many reversals , and trolling of the figures, twitter fights and all that. that's all a huge distraction.

that is my big hope. that he recognizes how much more effective he would be as a leader. and how much better the business results would be, if he looked at the science and data of peak performance. caroline: ed mentions your expertise having been a board member, and holding executives to account to make sure the right governance is in place, many might look at elon musk and sam bankman-fried and say they might not have much of a board and all. do you think as we head towards economic turndown, people will put more focus on corporate governance? arianna: it is startling to think ftx did not have a board. isn't it stunning that major investors in a company without a board. i saw from my rubric firsthand the dangers of burnout.

and the decisions that led to that almost brought down the company. we saw what happened with ftx. we have so many examples, that it is now time to stop celebrating an outmoded way of working. i looked at where this started, it goes back to the industrial revolution. caroline: uh-oh. arianna: the world started revering machines. but for the human operating system, downtime is a feature. caroline: it is in many ways backdated. i am interested in your expertise in corporate governance, but also as a woman who led the charge in a new form of media. it must be fascinating to watch

a new form of journalism, citizens journalism, how has it evolved? arianna: i launched in 2005. before you were born, caroline. caroline: i wish. arianna: the vision was to democratize media. now we have seen the democratization, there is a lot of great stuff about it but i've also seen how people gathering around just what they believe. the whole danger of confirmation bias, and only reading things we agree with is a tremendous danger for democracy in the truth. ed: sorry, just on that line, i still find twitter to be a chaotic experience. what i use the platform, i can't tell if it has improved or got

worse. it is certainly changing. what is your view on the platform itself, the content that gets generated, the news that spreads through it. arianna: it's definitely changing. but we don't know how far it will change. it's interesting that elon musk still agrees some people should be banned. the people he would ban are different from who you or i would abandon. but -- would ban. but the principle of free speech does not mean you can cry fire in a theater. caroline: you can have so much more of a direct relationship with your own audience. that's what we are trying to do on the bloomberg technology show, going to people where they are at, so they are consuming on tiktok or instagram. we asked our audience whether they trust twitter as

verification. does it give you confidence in citizen journalism? 61% say no, so we know there are limitations. at this moment when we are all wringing our hands about the way technology companies have been growing, the way we look at a slower economy, are you still positive on innovation and leadership? arianna: incredibly positive. we worked with hundreds of companies around the world. we have seen that the crisis of the pandemic has been a huge catalyst of fundamental change in the way workplaces are run. in the way employee well-being is prioritized. in actually seeing the result in business metrics. that makes me incredibly optimistic. caroline: as we start to see the

pendulum go from employee to employer. arianna: even though there are layoffs and hiring freezes, we have gathered over a hundred major companies to take a mental health pledge that they are not going to regress when it comes to investing in the well-being of their employees. caroline and and, as you know, we have a huge mental health crisis. it's an away the second pandemic. so for businesses, these are not warm and fuzzy decisions, these are central to their business strategy because you do not want employees falling apart while you want them to be productive. ed: thrive founder and ceo arianna huffington, thank you for sharing your time. coming up, we will discuss what to watch for in sam bankman-fried's house hearing on

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caroline: now all eyes are still on the ftx founder, sam bankman-fried, as he expected to testify virtually in front of the house financial services committee on capitol hill. sonali basak is headed to d.c. in real life right after the show. thank you for sticking around with us. what are we anticipating for him to say that is new that we haven't heard in some form of apology to her already? >> you have the new ceo speaking

first, and then sam bankman-fried speaking after. we hear that will be in the afternoon, so there is time in between. to what extent does he answer things we know that john ray has not only put in the bankruptcy filing, but in the testimony posted on the house committee right now. those include a failure to implement virtually any systems or controls necessary for a company to be entrusted with other people's money. we know sam bankman-fried has spoken a lot, including today on twitter spaces, and as we take a look at what he said we can expect him to reiterate some of this tomorrow. right now he has no data about anything. all he can go off of is his memory. he is no longer ceo of the company, so there is data he is no longer privy to. but he wasn't hard from the beginning of ftx. he also said he bears responsibility for making sure he did the right things is a company, and he had a massive

failure there no matter what. he has taken some responsibility, but at the end of the day, he has been very careful to recuse himself from the idea of ftx investing customer assets to his knowledge, important point. ed: we get an act one and act 2 with john ray, who is the current ftx ceo testifying. it is not as if they are going to bump into each other in the hallway and have an awkward hug or something. [laughter] >> not a lot of hugging these days for sure. he is testifying virtually. he is slated to testify tomorrow. we also have to talk about the idea that the senate has already said, sherrod brown and pat toomey said in a statement that sam bankman-fried's counsel is

unwilling to accept service of a su keenan. -- service of a subpoena. why he is testifying in one chamber as opposed to another is an interesting question. what he said today on his podcast is he wants to give a full account, rather than an incomplete account here. the point we've been making all day is why is he willing to give incomplete accounts to the media but not the lawmakers who are responsible for constituents and who have taken money from him in the form of political donations as well. caroline: just talking about media, this piece by the australian financial review about the inner circle powerhouse at ftx that were using i think it was telegram for communication, what did they call the name of the chat? >> allegedly wire fraud was the

name of the chat with his inner circle. he responded on twitter and said if this is true, i wasn't a member of the inner circle, i'm quite sure it is false. he may be asked about this again. also on in the unusual whales podcast, the last question was interesting, they asked about money he gave to the block executive. he hopped off the podcast at that point. he gave money to lawmakers and media organizations, so he might get questions about the influence he was trying to wield and why. ed: i know what the three of us are going to be doing on thursday. coming up, elon musk's surprise appearance at a company showed not so funny to some in the audience. this is bloomberg. ♪

>> make some noise for the richest man in the world. it sounds like some of the people you're fired are in the audience. [laughter] caroline: today going viral is elon musk's appearance at a dave chappelle show. he was brought on stage wearing an eye love twitter -- i love twitter shirt. musk was practically booed off the stage and the video was taken by someone who snuck into the event, posted on twitter before the account got deleted.

in a tweet, musk wrote technically it was 90% cheers and 10% booze, but still that is a lot of boos, which is a first for me in real life. ed: dave chapelle was saying that some of the people booing were perhaps some of the people must fired from twitter. caroline: comedy is always very close to the line, but that felt like perhaps a bit of a comeuppance for elon. ed: clear lake, there was a strong reaction there. caroline: tell us your thoughts on twitter. tomorrow we have palo alto networks' ceo. this is bloomberg. ♪

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