Transcripts For BLOOMBERG Bloomberg Daybreak Asia 20171112

Over 25 billion. Betty i think i even read somewhere that discounted at lobsters were for sale for singles day. Everything was on sale. It is going to be another we have had a whopper of the week last week, it will be another busy week. I want to point to one very key report that will be happening here in the u. S. , that is the cpi, the Inflation Report on wednesday. Right before that we have ppi. What traders are saying is this is the last Inflation Report before the fed makes its decision next month, so it comes in either too hot or too cold, that could have a Significant Impact on the fed and their decision. Lets take a quick look at this it is just a bloomberg chart i pulled up here, it shows specifically how the yield curve has been flattening out. We seem to be on this particular expected rate hike path. Futures are showing over an 80 chance we will see a rate hike next month. If wer, as i mentioned, see a really wacky Inflation Report, that could pull back expectations. Yvonne we see it with the data recently, the hurricane effects have not exactly materialized in the data points, when you take a look at gdp as well. You contrast that with the divergence in the stock market and we continue to hit rallies along with the bond market. How there iss show a reason for concern. That certainly could rattle the fed next month. Betty lets give a reminder to our viewers about what happened on friday. It shows you that some of this enthusiasm in the upgrading markets might be pulling away. The dow was down about 40 points, the nasdaq also trading, it finished about flat. But there were a lot of tech stocks trading lower. Some of the major tech shares, in fact. It basically ended an eight week winning streak we had seen in the u. S. Market as we much quicker march closer to the fed decision. Yvonne it has certainly been a different story here in asia when it comes to the tech ipo frenzy, especially in hong kong. One will be debuting today. A big interview in this hour with the ceo. Here is how we care and asia, a mixed picture when it comes to new zealand so far. Resting saying it up about one quarter of 1 . 59. 23 for the kiwi. Despite bit of weakness the continued weakness we are seeing and the dollar, as well. The asx 200 is underway. Were seeing it on the back foot for the benchmark, down about 1 10 of 1 . Aussie, 26. 59. Down, the openings of japan and korea. What a roller coaster we have seen, particularly when it comes to japan. We saw two days where we have seen pullback. Are we seeing some correction now after the rally we have seen . We could be extending those declines today in tokyo. Four dollaryen. Betty lets get to first word news. Ramy alibabas singles day when global, generate generating sales on and offline. It racked up over 25 billion in sales, pulling in shoppers from 20 different countries. Ultimately, 80 brands itself 15 billion in sales. Uniqlo unique low were among the biggest winners. Softbank is buying a stake in uber. The papers may be signed in the next hour. Benchmark will posit is lawsuit against ubers founder when the reforms kick in. The imf has welcomed chinas decision to relax decisions on is ad ownership, saying it positive development showing increasing confidence in the financial system. Speaking to bloomberg, Christine Lagarde says china is listening to warnings about excessive debt and is taking action to wind back leverage. She says it shows a newfound confidence. Ms. Lagarde the fact it is continuing to remove at least removedy barriers, and the threshold of 50 and then gradually to eliminate the threshold, that is an indication of two things, openness and also better strength and confidence in their own system. Ramy global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am ramy inocencio, this is bloomberg. Yvonne thanks. President trump has warned asian nations that the u. S. Will no longer be disadvantaged in train. Speaking in the philippines, he said his administration is changing the rules and will terror trade deal he considers will tear up trade deals he considers unfair. , there was a concern the u. S. Administration under President Trump, whether he would maintain a presence in the region. It seems the president is laying down the law. Yes, he is maintaining the u. S. Presence in asia, he just wants to rules of trade rewritten because he said the existing rules, especially the multilateral agreement they have been working on, do not work for the United States. Yesterday, i believe he said the wto has been unfair to the United States. Strikebeen trying to bilateral trade agreements with his main trading partners out here, including the first stop in japan, and also renegotiating the trade agreement with south korea. Transpacificf the partnership, that is the one development that apec discussions will further here in manila come up before they moved to the geopolitical side of the discussion at the east asia summit tomorrow. They will be talking about healthy Transpacific Partnership remaining members can continue on without the United States. They did secure a Framework Agreement over the weekend at apec. , some of theto see participants say there are many months if not years left to nail this down. Keep in mind, china and india have been pushing a 16 nation trade block. The regional copperheads of economic partnership. It is more about lowering tariffs than the tpp, which is more copperheads of and more tricky, because it builds in intellectual Property Rights and labor laws. Back to donald trump, this is what he had to say, a repeated message he has had to the five main countries he has visited on this trip, that the United States has trade deficit at least in goods. About free, he said fair and reciprocal trade. Tosident trump we look for achieving a bilateral trade agreement with partners who abide by the principles of fair and reciprocal trade. Two very important words, fair and reciprocal. It has not been that way for the , andd states almost at all we are tending that in changing rapidly. Again, donald trump will have a bilateral meeting with the president of the philippines. An interesting note is will donald trump push him to relax the human rights issues on the Drug Campaign that duterete has been waging, or will he give him a pass on that . Yvonne that would be a key point to watch out for. What about the reaction from the president about brokering, mediating essentially the territorial disputes in the South China Sea . Betty what has been the reaction to that . When trump was in north asia, it was a big geopolitical issue the big geopolitical issue was north korea, but in south asia, the disputes in the South China Sea tend to be the flash point or potential flashpoint. About trump has talked chinas land grab, if you will, in the South China Sea. He even offered in manila and also i believe in the name danang, to be a mediator with the south asian countries. But considering he has been vociferous in his criticism of china, im not sure beijing would welcome him as an arbitrator. Have the foreign secretary of the philippines saying he would welcome donald trump is a good gesture. He also said he is the master of the art of the deal. That being said, the philippine president said perhaps, south left sea is a issue better untouched. Nobody can afford to go to war. Betty thank you so much. We will be back with you with more. Stephen engle for us. Lets bring in Southeast Asia program director, nec right. Seawright. Lets go right to the point that steve was talking about a moment of thethe brokering territorial disputes in the South China Sea. President trump sort of offering assistance. What did you make of that . Unusual offer. Not sure how realistic or practical it is, if i dont think china would want the arbiter. Ates as an certainly countries in the region would like to see strong u. S. Involvement, but they would like to see the United States stand up for principles and rules and International Law, which will he goes against a lot of chinese claims. Betty it does. What do you think would be the motivation behind this . It sort of seems like it came out of left field. What you think of the motivation behind President Trump offering this and injecting that topic into these discussions amid trade talks . Amy it did seem to come out of left field a little bit. That makes me think it may have been President Trumps idea himself. He is the author of the art of the deal, maybe he thinks he can do that in the South China Sea. But it doesnt really track with other messages the administration has been trying to put out. It causes a little bit of confusion because the messaging on the South China Sea has not been quite as strong and clear and explicit so far in his trip, and his various engagements as some of his other things like America First has been. Yvonne we heard from the president of the philippines as well, talking about this, saying the South China Sea is better left untouched and nobody can afford to go to war. If the u. S. Is America First, who is driving the debate right now . Being the fit peacemaker in these maritime disputes . Amy thats a good point, the philippines has stepped back to where it was a year ago, where it won an amazing legal victory in a case brought under the International Law of the sea against china in a claim. But when the president was elected in the philippines, he was clear that he wanted to take a more soft line with china and not put the South China Sea dispute in the front and center of the relationship, but focus on Economic Engagement and other issues. He has stuck with that. Meanwhile, you have countries like vietnam that are still in the midst of a number of disputes with china in the South China Sea, taking up the mantle of the issue. But but they have been divided on the issue and the u. S. Not speaking with a clear voice after that. Yvonne and the timing of the trip, the philippines president says he will cut the cord with be closernd perhaps with countries like china and russia. What can a President Trump do this trip to get the philippines more aligned with the u. S. , and perhaps a better relationship . Called veryve been similar when it comes to their firebrand language. Amy there are striking similarities in their personalities and political style. Whenhilippines president , he came into office, he had very tough talk about separating from the United States, and downscaling the alliance. In truth, not much is actually happened along those lines. We still have a very Close Military to military relationship. But the rhetoric has been tough and there is a sense of distance. There has certainly been an approach from the philippines president to china. I think he is actually looking to reboot the strong relationship with the United States at the president ial level. There are a lot of similarities in these two leaders. Theyre both tough talking, populist, very political characters from outside the main the political elite. I think they will hit it off, actually. I think they will get along quite well, and both leaders are looking to revitalize the security alliance. Yvonne looking for potentially good reports between the two trumps. Asias trump and our trump. Right. A chinas listening relations on investment in banks. ,ow banks are doing the push later this hour. Betty next, north korea has not fired a missile in about two months, but south koreas foreign minister warns against complacency. The exclusive interview is straight ahead. This is bloomberg. We are counting down to asias first major market open this morning. Japanese futures are looking like this, down about 1 10 of 1 after friday in the u. S. Closing lower. It in the winning streak. This is daybreak asia. The new south Korean Foreign minister says the fact that the north has not launched a missile into months is an encouraging sign, in a first encouraging sign. In her first interview, she warned against being too optimistic. Not read too much meaning into this, but one way of reading it is that the message of the international community, the global condemnation and absolute inaccessible unacceptability of the Nuclear Problem Nuclear Program is finally getting through. The sanctions are working, that might cause them to recalculate. It could also mean they are finetuning some technical aspects of what further provocations they might have up their sleeves. Have the good we spirit of no provocation. Needs to stop its provocations, period. Without this continues. Otherwise, we will never enter into any kind of serious discussion about denuclearization. Our goal through sanctions and pressure is to draw amount, to force the point on them that they need to change course. Do you think the u. S. And china are taking the right approach, or is there a need to bring russia into the fray . All veryk they are important parts. China, russia and the u. S. Are all members of the council, permanent members. Sanctions andse have a primary responsibility to not only implement the sanctions but in sure that these challenges to global peace and security are dealt with. On that fundamental level, we expect china and russia to play that very important role. Issue, irthern nuclear think china is implementing very faithfully the sanctions. We see the actions on the ground. Russia also says it is faithfully implement in the sanctions. Haslinda can north and south korea ever unite . There is always the future. Period ofter a peacefully living together, there will come a time when people on both sides feel it is time, but what we need in the first instance is a permanent peace. At know that we are frozen the armistice agreement at the end of the war, and that has not been replaced by a peace agreement. But for us to work toward a permanent, lasting tease, we need to come to terms with them. Yvonne that was a south koreas new foreign minister speaking to bloomberg. We have a busy day here, big guests today. We will have jpmorgan tech conference later. The bank global chairman joins kong ght 40 hong might 9 40 hong kong time. Jpmorgan advising at t on its merger. We will see if it is in jeopardy. Knowot a lot of people this Gaming Company outside of china. Evaluation of 30 billion, it is a mashup of groupon and yelp. Betty looking forward to that. You can get around of that story and many more you need to get your day going in daybreak. Subscribers can find it on their terminals, it is also available on the bloomberg app. You can customize your settings so you only get the news on the industries and assets you care about. This is bloomberg. This is daybreak asia. Lawmakers arecan increasingly split on tax reform. House number said they will not accept the tax bill that eliminates deductions for state and local taxes. That is counter to what the Senate Version of the bill contains. Joining us from washington is bloomberg editor ros krasny. How much action will be see on this house and Senate Tax Bill this week, it seems like it is boiling down to a few big issues, including tax breaks . Ros it will be another big week, these tax bills are full seem ahead at this point, the house has avoided the bill out of committee and they are expected to have a vote in the full house this week. The Senate Finance Committee Takes up its version of the bill tomorrow. As you said, there are big differences between the two bills. How they boils down to trillion dollars or more of tax cuts will be paid for. There is ate bill, total loss of the deductions for state and local taxes. Brady, the topin tax writer in the house, is against that. That is notomething uncommon, to have differences between the two versions of the bill, and that will be ironed out in committee, but it is a pretty big sticking point, i think. There are a lot of Republican House members in high text states, a high tax representative from long island is matter the mistake madder than a snake. Betty how difficult will it be to iron out the versions the differences between the two versions . Ros republicans are certainly highly motivated to get the bills done quickly and to get a version onto President Trump staff for signature by the end of the year, President Trumps desk for signature by the end of the year. But it is hard to know what the compromises will be. There is a lot of ground between the two bills. Yvonne thank you. Up next, beijings plan to ease for access for banks could have big implications for the Financial Sector. We talk about that next. This is bloomberg. It is 7 30 a. M. In hong kong, we have some cold air coming into the city this week. We are just about half an hour away from asias first major market opening this monday morning. Betty quite a bright and gorgeous day today, but still a bit chilly in new york. Sunday in new york. Markets finished a bit lower on friday. I am betty liu in new york. Yvonne i am yvonne mann in hong kong. You are watching daybreak asia. President trump has offered to resolve territorial disputes in the South China Sea as he enters the final leg of his tour in asia. He is attending a series of meetings on regional security. Flashpoint will be shipping lanes. Trump says he is a very good mediator and arbitrator. Meanwhile, japanese Prime Minister held talks with a taiwanese lawmaker despite being warned by china not to do so. He spent half an hour with the head of the Peoples First Party on the sidelines of the apec summit. A constraint already tense relations between beijing and tokyo. Has received no response to his proposed visit to china next year. In the u k, 40 conservative members of parliament have agreed to sign a little of no confidence in Prime Minister theresa may. The sunday times says that is a short of the requirement of force a leadership challenge. May has been under pressure since the snap election and has replaced to front bench ministers in the past two weeks. The smog choking new delhi is so bad that United Airlines has suspended flights to the city. This conditions have been described as a gas chamber, about 14 times the excepted danger level. Other airlines are still flying to and from new delhi, its not certain if they will follow united. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am ramy inocencio. This is bloomberg. Yvonne. Yvonne lets see how things are faring on your trading week. We are seeing shares in australia down one quarter of 1 . The aussie seeing a bit of a dip as the Prime Minister left leading a minority government. Falling victim to the dual citizenship scandal. Iris is the biggest loser at the moment, shares down 5 . Down close to 3 officer isief risk retiring. We are seeing a bit of an upside in rio tinto. It is back to a strong demand. We are seeing shares about 7 10 of 1 . Japan is aand korea, focus given the volatility pick up last week. We saw two days of losses, it looks like we are extending those declines, a drop at the open. According to chicago nikkei futures. We are seeing big data points this week, as well. Governor kuroda is set to seek in syrup this monday. Zurich this monday. We have plenty to look forward to. Relax chinas decision to restrictions on Foreign Ownership has been welcomed across the financial industries. Summit, at the apec this is said to be a welcome development. This type of conversation is very positive, it is very good for china. And of course it is good for International Players that want to have a part of that market, which is interesting and attractive. They also say it is important step in opening the Financial Sector on the mainland. Joining us from beijing is the banks chinese president. Thank you for joining us. Some of the preliminary reactions we have heard so far is that it is a step in the right direction but not a huge step. There is still a lot of work to be half. What is your feeling about this news work to be had. What is your feeling about this news . Eugene it is a step in the right direction. Since late last year, beginning this your, the Chinese Government has been sending out a signal that further opening of the Financial Markets to all players is the way to go. I think china is maturing in the Financial Markets, and with the msci inclusion sometime next year, were up 5 . Here, you have licensed Security Firms, they are two from active they are too fragmented. We expect a major step up by foreign players. Betty i know you are limited in what you can say specifically right now, because it is still early reactions to this, from ubs point of view, what might we expect out of ubs . What are some of the steps you might take given the further opening up . I think ubs is like any other International Leading firm, who has taken a longterm view on china. We feel at this is the right thing to do, we are going to look for ways to increase our presence onshore, and our Global Leaders have announced that at the beginning of 2016, i think we are going to invest more and have more of a presence in this market. China is one of the key markets for the whole group across asset wealth management. We are looking for ways to step up, including the can for ways to include two increase our equity stake in china. Dimon jpmorgans jamie has talked about the china market and some of the frustrations they have had, which is why they have left certain aspects of the chinese market. He was asked a question about being in china and what are his goals, and this is what he said about Foreign Investment in china. Cameth Foreign Investors in, it can sometimes be a little bit of a pain. On the other hand, they demand transparency, governance. Jpmorgan to play a part in helping set high standards for governments governance. Betty do you agree with that . Think Foreign Companies bring a lot of things. I think the china market is becoming more and more open to international investors, we have some leading International Firms here in china, offering those kind of service alongside the leading Chinese Security firms, it will provide diversity and a lot of Good Practice from Global Markets to be introduced in china. I think chinese authorities have recognized this a long time and now they say it is the time to open it up to allow the foreign majority controlled Security Firm for the next three years, and beyond that, anything up to 100 , wholly owned will be allowed in china. I think foreign firms will continue to be involved, and if anything, will step up and do more. Yvonne china is breaking the end of his credit cycle. Sheets of look at the banks. The issue is very much there. Tothe timing right for ubs increase its stake in the mainland . Mckenzie just came out with a report saying that one in three chinese banks failed to create economic value. Eugene we take and medium to longterm view on china. We think in the medium to longterm, China Remains one of the most vibrant economies, with the local Wealth Creation and Capital Markets opening. A lote shortterm, we see of the work needs to be done, and precisely International Firms such as us, j. P. Morgan and others, could help the chinese economy to restructure. It is usually the international, helpsroven partners that the local conditions. I think we have a lot of room to contribute with the restructuring. Yvonne what does this mean for Crossborder Capital flows . Weve seen two years for china has put a heavy hand when it comes to capital controls. Is getting out going to be as easy as getting an . China i think both ways, recognizes it has to be more orderly. As long as there is a temporary tighter control, it seems to have worked, there has been stabilizing, with exchange rates. I think it will be more orderly. What we need to say is that china is still looking for crossborder acquisitions. They call a noncontributing sector. I think the highend Manufacturing Sector and some of the consumer deals that we are working on, were still seeing the capital outflow. If anything, it is all more orderly. Yvonne thank you so much for joining us. Ubs china country head and president joining us live from beijing. Hardwareilipina gaming wert with start is discussed their expansion plans. This is bloomberg. Are finally getting a confirmation from uber, they are confirming the softbank investment offer come up there has been an offer made, in a statement they approved softbank for multimillion dollar stake. The expectation, up to 10 billion will be invested in uber shares. Softbank and other firms will be offering up to 10 billion for uber shares. We are waiting for more details on what this entails, because it is hinging on some governance reform at uber, including putting on hold by benchmark the lawsuit against travis kalanick. They have approved this multibilliondollar offer from sat from softbank up to 10 million. Yvonne we will see how softbank shares fair. In the meantime, a big ipo talk. The debut being made in hong kong. In thehave jumped market. Times whatd over 300 was subscribed. The ceos here. Thank you for joining us. A big day for you. Is foralways said razer gamers and by gamers. Is it for investors, too . What does this mean for the Growth Prospects . The ipo is crazy. Retail has been through the roof. I think we are the first global tech brand to list in hong kong, and i am excited, i am optimistic. Yvonne you are in a pretty good that cash position. Why decide to list in hong kong versus singapore, versus nasdaq in the u. S. . Are the number one gamer brand in the u. S. , europe and china, we thought hong kong was the perfect location to be right in between the u. S. And china, both sides of the market. Having Strategic Investors helped as well. In thei am sure here u. S. , there is curiosity why you chose not to list in the u. S. On nasdaq or the n. Y. C. Nysp. As i mentioned, we are big in the u. S. , not people know not a lot of people know we are in big brand in china. We broke records on our categories, we are still number one on several sites. Because of that, we thought it was a great opportunity to be in hong kong and be the first Global Tech Company to list in hong kong, and hopefully in a couple of months to come, to get on the hong kong market, too. Yvonne im also curious about the smartphone in the market. You make accessories for desktops, laptops. What are you going to be able to offer others with the smartphone that apple or samsung are others cannot . We focus on the 2. 2 billion gamers out there. We built a massive ecosystem of hardware, software and services around a gamer. Moving to the mobile sector allows us to extend the ecosystem. In the pcy wellknown sector, well known in the consul sector, and now we are extending across. The mobile sector allows us to address the gamer, the 2. 2 billion gamers out there, in multiple platforms. We think it is a great opportunity for us to do that. Since the launch, the phone has done incredibly well. Traded on social media. The first reviews have been stellar. For ourselves, we just focus on the gamer. It has done well for us in the past couple of years. We hope to continue doing that. Betty its more of a niche market . Its more toward the gamers and not really looking at rivals like apple or samsung . Its a completely different ballgame for you. I wouldnt call entertainment gaming a niche, 2. 2 billion gamers out there. Focus has always been on entertainment come at the gamer, and we built the phone for all of that. It is a gamer phone, not a gaming phone. We wanted it to be the ultimate entertainment device. Today, most people use their smartphones for entertainment. It is great for movies, great for music, and of course great for gaming. Betty it is something my teenage boys know very well. Curious, relating to the news we had a few moments ago about softbank investing 10 billion into uber, i am curious why you decided to go into the Public Markets to raise money when it seems like out there in the private sector, there is a lot of money rolling around, particularly from softbank. Why not just go to your investors again to raise this money . I think that was one of the things we definitely considered, and many of our investors have actually offered to have is continue to be private. One of our cornerstone investors, one of our early invest cornerstone investors was an early investor too. We have a profitable core business. We are extending into categories. We thought this was as good a time as any to go to the public market. We have been prepped to be a Public Company for a while. On top of that commodity gives them an opportunity, i think even for our community, the gamer immunity, to own a part of the company. Thats something we truly believe in. Yvonne youve lost money the last two years. What is your estimated Revenue Growth for this year and when do you think you will turn profitable again . I cant comment on future numbers, but our core business, if you look at the numbers, is incredibly profitable. What we have done is we have had a standard playbook of sorts, investing in new categories, and any and category becomes profitable, we move it into a profitable pile. Then rinse and repeat. We have done that with our gaming laptops, weve moved into giving mobile devices. Yvonne are you concerned about deviating too far away from your core, which is handsets and hardware . Were not a Hardware Company or Software Company or service is coming. We are all of that. Building an incredible ecosystem. We have for a million users on our gaming platform, that makes us one of the biggest in the world. Just on the internet size of internet side of things. Our focus has always been very clear. It is the gamer out there. That is just growing exponentially. It is not stopping at this point in time. We have seen china come up, new markets we are incredibly excited about. The opportunities afforded to us in the entire ecosystem is something we see growing exponentially in the years to come. Yvonne what is the biggest risk and opportunities and some of these new opportunities these new technologies . What are some of the things you can capture what it comes to these capabilities . The beauty of recent technology is that a lot of new technology has been promoted by gaming. Vr started with gaming, motion sensing, all of that. We have a really interesting position to be the head of the taste makers. We are moving things along. We aree brand we have, the leading lifestyle brand for gamers everywhere in the world. We have a massive just a vision platform. We are well poised to roll out these technologies will become about. A great its opportunity for ourselves not just on a geographical level, for example china, or other markets like Southeast Asia, indonesia, but it is just so much more. Yvonne good luck to you today. s ceo joining here in our studio. Betty breaking news right now on japans tpi come up for the month of october coming in. A bit hotter than what economists expected. 3. 4 is the game. Economists had expected 3. 1 . Revised amonth was touch higher, as well. Month on month, also a pretty sharp gain. Economists estimated a rise of 1 10 of 1 . Some of this is being fueled of the increase in Commodity Prices , oil especially, but also the decline in the yen over the last month or so has also contributed to these numbers. Japan ppi coming in hotter than what economists had expected, 3. 4 year on year. Much more ahead on daybreak asia, we are counting down to japans open. This is bloomberg. Is daybreak asia. Betty alibabas annual shopping extravaganza set new records, well, morezer as than 25 billion for singles day. That comfortably beat the forecast. Ramy inocencio has what you need to know. Ramy amazing numbers. In the first two minutes in one second, they made 1 billion. Im not making that, people can only dream on an individual basis. For the first hour, 1. 6 billion. Over the course of the day, over 25 billion. Citibankion more than predicted. Take a look at the chart behind me. This is revenue in the white line for alibaba, tencent is the blue line. You can see the day economy the deck height to me dichotomy. The spikes coincide for single day. One day, we see the revenue pop. In 2016, they came in at 30 billion yuen. Looking at the forecast for the upcoming quarter, it looks maybe to be 80 billion. We will look ahead to see what happens for the upcoming holiday quarter. The future remains even brighter for alibaba, and that is because 2708. The population in china is still 43 rural. They are still untapped. Alibaba said that 90 of the transactions from single state actually were made on mobile phones singles day actually were made on mobile phones. There is a new, untapped market. Look at that, 590 Million People still considered in rural areas. 4512. Y, chart a fairly simple one, the white line is alibaba. Your today, up by 110 , eating tencent in blue. Beating tencent in blue. Really being outstripped by alibaba. Looking ahead, im going to throw in if i know chart, this is the anr function. If you see red, and i know you dont, red means sell. You dont see that for alibaba. Out of all of the people foreyed, there were 47 buys alibaba in just a couple of holes and zero cells. And zero sells. Theres definitely a premium we are waiting to see over the next 12 months. We could see that very soon, especially when it starts trading on monday. Yvonne thank you so much. Those three charts you need to know on alibaba. Coming up in the next hour, Orient Capital Research managing director Andrew Collier joins us to discuss chinas historic move to open his banks to Foreign Investment. That is in about 10 minutes time. This is bloomberg. Is this a phone . Or a little internet machine . It makes you wonder shouldnt we get our phones and internet from the same company . Thats why Xfinity Mobile comes with your internet. You get up to 5 lines of talk and text at no extra cost. So all you pay for is data. See how much you can save. Choose by the gig or unlimited. Xfinity mobile. A new kind of network designed to save you money. Call, visit, or go to xfinitymobile. Com. 8 00 a. M. In hong kong. We are live from bloombergs asia headquarters. Tourdent trumps asia headed to a close with a warning on trade and an offer of mediation. ,sian stocks suffered declines pessimism over u. S. Tax cuts driving equities back. I am betty liu in new york just after 7 00 p. M. Uber with a big investment from softbank worth up to 10 billion and includes Corporate Governance changes. A busy week ahead for banks in japan. The big news all weekend has onn the bang from china friday in terms of opening its Financial Markets. The big question is what does this mean for foreign firms. Ubs saying it was a step in the right direction. Lays thechart that land in terms of the foreign share of total bank assets in china. This is chart 6825. While symbolically the right move, you could argue the share of total bank assets among foreign firms has dropped to a 1. 3 right now. A tease of thef pie candies u. S. Or european banks get a share of right now . Can they level the Playing Field and gain market share . You could look at that chart and say it is also a product of not getting that market access. What we heard is that finally steps are being made in the right direction. This all happened outside of President Trumps trip to asia. For wall street banks, but not sure how much they can thank President Trump for that. It is a gift he might be able to claim in the aftermath to bring back to the u. S. Im sure he will be patting his back on that news. Uber approving softbanks multibilliondollar investment offer, setting the stage for one of the biggest private start of deals ever. Peter elstrom joining us this morning. What are the details and the key terms . Uber confirms there is this preliminary deal with softbank and other investors. The idea is investors will put in about one billion dollars in fresh capital, at the valuation that uber has currently, 70 billion. These three investors will buy about 9 billion dollars in existing shares from current shareholders, and the prize for that purchase has yet to be set, but looks like some sort of agreement here. It looks like there will be the companyeforms has touted as good for the longterm health of the company. Travis kalanick is giving up some control over the board. Benchmark is putting on hold a lawsuit against the former ceo. So putting that issue on hold clears the way for investors, including softbank. What is having a firm like will it improve uber in the competitive markets around the world . What will be the difference with softbank there . Softbank has invested aggressively around Rideshare Companies around the world. In the chinaleader grab inand ola and india and Southeast Asia. There may be opportunities to share technology, collaborate a hit. It is not clear how far they may go down that road, if there are antitrust concerns, but at least softbank will benefit if this deal goes through. This investment includes lying up 9 billion of shares from existing investors. What price are we expecting to see softbank pay . It has not been set yet. They set the terms for the offer so softbank can bid for the shares, existing shareholders can respond. There was some backandforth about the process on how that final price will be set. The 70be lower than billion of a wishing it has now come up clear how much lower. Thank you so much. Now, but not clear how much lower. Thank you so much. Now lets get to first word news with ramy inocencio. Generating record sales on and off. The holiday extravaganza wrapped up 25. 3 billion in sales with buyers from 225 countries and regions. Is a 39 increase in demand and help brands top sales. Meanwhile, foxconns parent has signed an agreement for a 10 billion investment in the state of wisconsin. The state had offered 3 billion in taxes for the company, which claims 13,000 jobs could be created. Ai will pay 1 billion if it fails to uphold it side of the contract. The president is now in the philippines for a series of asean meetings. Trump says he is a very good mediator and a very good arbitrator. Global pressure on the north seems to be having an effect with no missile launches or provocative behavior for almost two months. The rumors that kim jongun would test a weapon during President Trumps visit to asia turned out to be unfounded. We need to be absolutely confident of our deterrent posture, the combined deterrent posture with the u. S. Forces, own deterrences capabilities, and to do so, we need to constantly upgrade and update our military capabilities , and we have an important agreement with the United States that south korea will continue to develop and acquire state of the art military assets. Global news 24 hours a day powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Thank you. Taking a look at equities and asia, looking set to fall as we kick off the trading week. We did end friday slightly lower. That risk off mood looking to continue as we start the trading week. Capped the first losses on friday. We have pessimism around tax turmoil initical australia dragging on the aussie dollar. Check out the falling pound. And s data can lower galore and Party Troubles for theresa may. On the ecoagenda, india today. On japan cpi better than forecast. Later this week, japanese gdp, but the nikkei 225 falling for a fourth straight session this monday. The yen is starting the week softer, down. 1 . Key u. S. Cpi data on wednesday could drive the dollaryen the move. One analyst says the dollaryen will state within a 113114 range. Unless there is a significant plunge in the nikkei. Ahead of u. S. Inflation numbers, to year treasury yields are at 2008 highs. A bright the kospi, spot in asia, halting a two date rock. More on that later. I want to show you some earnings movers. The first of big japanese banks to report, facing tough Cost Management pressures. Couple must 2 after better than forecast results for ntt. Softbank slightly weaker after that uber deal. We are keeping and i on fast fastling eye on retailing. Yonhap reports that chinese sales rose 10 to 30 . Reported a 30 boost this month on the chinese language shopping site hotel shilla. Thank you. The sales of single day. Still ahead, we speak to the talkf a pension fund and about the funds Asian Investment plans. We will talk about chinas historic moves. This is bloomberg. This is Bloomberg Markets middle east. This is daybreak asia. Christine lagarde has praised chinas plans, describing it as a positive development. Tom mackenzie in beijing joins us for more. Is this something the imf has been pushing for . And they have been pushing for greater reforms in china, but also when it comes to the Financial Markets and institutions here. Yes, this will be part of the package that the imf has been pushing for. Lagarde in vietnam on setsidelines of the apec this show chinese policymakers were confident and willing to open markets here. Take a listen. Isthe fact that it considering to remove at least partially those barriers and to move above the threshold of 50 , then gradually to eliminate those thresholds, that is an indication of openness and better strength and confidence in their own system. Tom Christine Lagarde ,ommenting the news on friday these plans laid out by chinese policymakers to remove the 25 on Foreign Ownership of banks and allow foreign institutions to increase their stakes and have a majority ownership in their joint venture stakes. This has been welcomed. We have been hearing this morning and friday afternoon from j. P. Morgan, morgan stanley, and ubs, saying they are looking forward to more this. N this here it part of the idea is by lowering the barriers to foreign financial institutions, it may inject competition into the sector and improve risks and Corporate Governance, areas that foreign firms have a heads up on or better standards versus their chinese competitors. It comes as china is trying to tackle this debt. Christine lagarde said the chinese were listening and trying to take steps. Clearly this is part of the max, and encouraging foreign firms to get involved. The wto 16 joined years ago, foreign banks and investors are 1. 3 of chinas banking system, so tiny. We may now get to see that pick it is increase, but always about the devil in the details, so we are expecting policymakers to outline more get moreetime soon and details about where this takes us, but certainly welcome broadly by jp morgan, morgan stanley, ubs so far. Stick with us. We want to bring in Andrew Callier in our hong kong studio. Dontis still a lot we know, terms, pace at which china is ready to open up, questions about the timeline and market access. You said you were surprised. How significant . Significant if china gives access to western and foreign firms. The question is the timeline and what opportunities there are. There is a big mismatch between what the chinese want and what foreign banks want. Couldnt this be a winwin situation . Foreign banks have been keen on entering the chinese markets, and perhaps these are and entities can help the chinese banks in terms of recapitalizing isnt there a Beneficial Partnership your potentially as well . There could be come a but most of the banks dominate the credit situation and will be reluctant to give up market share. Plus, there are a lot of government connections in government controlled banks, and to hand that over to western firms is unlikely. Investment banking, it is a similar problem where there is a lot of money to be made by certain firms, but western terms will not want to bring in their Big Technology and get into that market. That may be one of the reasons you were talking about earlier, the day disconnect between what foreign banks want in the Chinese Government wants. Where do think they are farthest apart here . The chinese probably want modest reforms in commercial lending and professionalize their securities markets. Western firms will be unable to get in the commercial lending business because there are ties that dictate that business in china. In terms of the Securities Brokerage business, western firms have equipment and technology, but will be reluctant to do that until they have 100 ownership. I think western firms will chase minority areas, things like raisingies products and capital offshore, smaller areas of the industry. Muches this boil down to ado about nothing then . Now, yes, but i think there is a growth path. It is positive china is saying this. Perhaps it could be the cbrc and pboc is pushing for this. It will be a while before we see significant share by foreign firms. Do think another level of concern is they can get their money in, but can they get their money out and getting clarity and transparency on that as well . That is extremely in porton. The one area that could be beneficial is if chinese start raising more capital offshore, then the brokerage forms firms would be helpful in doing that. If they happen onshore presence, that would facilitate that. Theyinas economy slows, will have need of more foreign capital. In terms of bringing it on sure, that will be a real problem. In terms of the commercial banking sector, some have suggested one focus might be the smaller lenders, a few branches with high debt problems that foreign banks might be able to help clean up the Balance Sheets , would that be a potential strategy that could work out longerterm for the foreign players . You,completely agree with but mostly out of sheer desperation. I am expecting Bank Failures among the smaller banks, and that is an opportunity for a foreign bank to come in. Lets say the bank fails, the local government will say give us . 90 on the dollar, and the Western Banks will say we want to pay . 40, so a mismatch in valuations. If the Western Banks are really taking the risk, there is opportunity. What does this say about jinping . Xi there was not a lot of mentioned when it came to market reforms. It was more about increasing state owned enterprises. Of a boxhe ticking when it comes to market reforms, or is it a symbolic move . It could be like wto access , trying to force as so easy to reform, so it could be this cbrc and the pboc is pushing the same thing here, get them market share and maybe they will help organize our own system. So much for joining us and shedding some light on this news over the weekend. The managing director of Orient Capital Research, and thank you to Tom Mackenzie in beijing. The Philadelphia Fed president is speaking in tokyo right now. We are getting some early headlines. Rate hikeng another is lightly penciled in for 2017. There is little slack left in the job market and low inflation is a horse still a concern. Notedteresting thing hed is that the fed Balance Sheet unwind will be boring, run on autopilot, perhaps signaling to Bond Investors not to get too excited, right . They always talk about how this unwind at the Balance Sheet is like watching to drive. Dry. The language, lightly penciled in for a hike in december. We see fed fund futures are almost a certainty this will happen. The next question to ask is what will move the needle . Will it be inflation data this week that will change his projections of what we could see , not just december, but 2018 . You nailed it. That inflation data might be the last piece of data that could derail these expectations. Yeah, certainly case. We will leave that there. Bloomberg subscribers can continue watching the speech from tokyo at live. This is bloomberg. From the earnings russian aluminum maker, the biggest outside china and listed in hong kong. Thirdquarter adjusted ebitda beating highest testaments at 549 million. Beatue also was a slight at 2. 46 billion. Adjusted profit coming in at 262 million. No surprise given the jump in a aluminum prices, about 20 higher so far theres sheer. These metals and commodities prices helping rusal. Said. S. Justice department to have told at t how to get the benefits they want from the proposed merger with time warner without being being able to own turner channels. Officials have suggested at t to by formingernatives a joint venture with the newly separated company. Reliance communications missed payments on rupeedenominated bonds due at the beginning of the month, the equivalent of 460 million and 150 million. The failure to pay is the latest indication of the companies mounting debt problems. Price competition has driven down earnings of rivals. The worlds biggest coal producer reported a fall in profit. Coal india says income through september dropped 40 to 55 million, although sales rose 4 . The quarter includes a national the coalement for industry, which the miners says will mean an additional annual cost of 870 million. The more ahead, assessing chances of a Market Correction in japan. We will speak to the second Largest Pension Fund in the u. S. This is bloomberg. Yvonne 8 30 in singapore. We are going to get some rain here as we did throughout the weekend in hong kong. Half an hour from the trading in the lion city. So beautiful in your area. You are watching daybreak asia. Lets go to first word news with ramy inocencio. Ramy uber has approved a big investment led by soft and worth 1 billion and will softbank worth 1 billion and can offer 9 billion and shares from existing investors. This includes governance changes. We will see Venture Capital causing its lawsuit against travis. They will drop the complaint when the investment and governance reforms kick in. The Philadelphia Fed president Patrick Harker is the latest policymaker to all but confirmed a rate hike before the end of this year. Insaid it is likely penciled , and inflation is expected to insert itself because of the tight labor market. The eventual size of the Balance Sheet is get to be determined, and the unwinding will be boring and run on autopilot. Australias Central Banks say improved expectations for demand or driving a pickup and nonmining investment, helping to buoy the economy. Upward trajectory and nonmining business in the last couple of years has been solid. Such real Term Investment is 10 years higher higher than 10 years ago. That is compared to 3 in japan. The japanese Prime Minister held talks with a taiwanese lawmaker despite being warned by china not to do so. He spent half an hour with the People First Party on the sidelines of the apex summit. Already straining relations between beijing and tokyo. Response to his trip to china next year. The smog in new delhi is so bad United Airlines has suspended flights to the city. The chief minister has described it as a gas chamber with levels 676 points per billion. That is 14 times the accepted danger level. Other airlines are flying to and from delhi. It is not clear if they were follow they will follow united. Global news 24 hours a day, powered by more than 2700 journalists and analysts in more than 120 countries. I am ramy inocencio. This is bloomberg. Yvonne those pictures say all. Thank you. Time to look at the markets with sophie kamaruddin. A little bit of cloudiness with the pound taking a hit early in the session. G10 space,k at the the pound leading losses against the dollar. Theresa may perhaps facing a leadership challenge in the coming days. That could bring uncertainty for the currencys outlook, and we have inflation data on tap along with a string of boe speeches on schedule. Mitsubishi says it is difficult to short the pound. Political troubles are in place for the aussie dollar. The government is losing its 0. 1 . Ty, down a look from the rba governor, it is enough to wake up the bulls. The go the dollar is gaining ground against the g10 currencies after a weekly loss. Asian stocks on the back foot. Volatility picking up. Look at korea. We have korean stocks swinging to losses for a third day lower. Eol. Moving so far in swou samsung is among the losses. It is fighting after thirdquarter earnings were amiss. This one plans to list on the talk to the tokyo stock exchange. It is registering recovering sales in china and the new sales overseas markets. But the Rising Consumer stocks are not enough to boost sentiment for the kospi. We have energy industrials along the biggest drags for the share market. Betty thank you so much. Looking at the movers. President trump has more asian nations that the u. S. Will no longer be disadvantaged in trade. Talks, het the asean said they are tearing up trade deals he considers unfair. The chief north asia correspondent Stephen Engle is in manila. The president is laying down the law on trade. How is it being received so far . Stephen he has been trumpeting this if you call it that America First. He wants to he has already resigned redrawn from the bilateral Transpacific Partnership. He is trying to talk about the Free Trade Agreement with north korea with south korea. He wants more fair trade agreements with japan as it and is engaging Southeast Asian leaders during his tour to get better deals for american businesses in this part of the world. Whether that will fall on deaf ears or not is yet to be seen, but china and india given the fact the cpb has gotten with existing 11 members, they toned a Framework Agreement push forward without the United States. India and china as leaders of this other multilateral trade pact are set. The they are pushing that. They are having added urgency given the fact the tpp constituents are lighting aflame to that trade deal. Right now we have donald trump as well saying he wants free, fair, more reciprocal trade for the United States first. Donald trump we look forward to receiving a bilateral trade agreement with partners who abide by the principles of fair and reciprocal trade, some very important words. Fair and reciprocal. It has not been that way for the United States almost at all. We are changing that, and we are changing it rapidly. So the 11 existing members of the Transpacific Partnership trying to get it going without that United States. The canadian trade minister calling it the comprehensive progressive tpp. The is a mouthful. Other members arriving at asean say it could be months and months of difficult negotiations. Tpp is more comprehensive than a regular trade package. It includes provisions for labor law improvement, for the environment, and for protections of intellectual property. Yvonne we also heard from the president sort of playing peacemaker when it comes to the maritime tensions we have seen in the South China Sea telling the vietnamese president if i can be of help in anyway, let me know. Is he serious about that kind of statement, and with the u. S. , are they paying playing a more pivotal role with the South China Sea . Stephen yeah, it is yet to be seen whether this offhanded comment actually, that donald trump as he likes to call himself a dealmaker, whether it was just offhanded where does indicate donald trump and United States will take a more serious and a poetic approach to resolving the South China Sea issues. On the early days of the presidency he had been critical of china and its reclamation in thes and land grabs South China Sea. It is yet to be seen whether china will be on board as donald trump as the mediator. The big thing today is a bilateral between donald trump and Rodrigo Duterte a. Due to her to residents are they are saintly the South China Sea untouched. Nobody can afford to go to war. , instead ofrte going into those waters, he took the request of donald trump and saying the song sang a song at the dinner. Yvonne wow. Stephen engle at the asean meeting. Even mnuchin is standing by. The Republican Party will deliver the biggest u. S. Tax cut. He said the proposals will be the largest mostly on every part. They hope to have the bill on the president s desk next month. Our next guest has the secondLargest Pension Fund in the u. S. With over 200 billion in assets. Joining us is cio christopher aleman. It seems like the tax bills when you look at the details for your industry, generally they keep the retirement contributions intact. So i am curious how you feel about these tax bills. Are you satisfied with what you have seen . Not at all, i am very concerned. The house version dealt with a. Ax called you bti ubti that could impact of this. I am curious about all of the different retirement plans. A lot of numbers, but if they are helping there is a lot of they will put together a tax plan by the end of the year. That is really questionable. From our perspective right now, we have a lot of questions and need more information. This is moving too fast to get that. Betty are you also surprised there is not a lot of substance in tackling carried interest . We heard from President Trump on the campaign trail, he said carried interest is something hedge funds are using to get away with murder. That what wasrned said on the campaign trail does not bear resemblance to what is being said today, which is frustrating i am sure. And the question of the taxability of carried interest needs to be clarified. They are longterm Capital Gains in our view. The most important thing from our perspective as a limited partner, how the general partner is taxed does not change the structure of that transaction. The two and 20 model is being broken. It is being buried. We need to move to different models. Whether they get attacked taxed on carried models should be irrelevant. This is their tax problem. It is not ours. I will argue with any general partner who tries to employ imply there is link it back to us. Betty you said that two and 20 is breaking, and you the cio of counselors is significant in breaking that model. How much further have you gotten in reducing those fees . It is incremental. We have started to see some 1. 75,ctions that go to 1. 5. It depends on the longterm capital. We are seeing the carried interest sometimes go as low as 18. Carried interest is a profit margin. It is an incentive for them to make money. I dont mind paying a decent amount of carried interest if they make the return over a hurdle rate. It is Management Fees i am concerned about because that erodes the capital. Yvonne you said you have been able to manage those reduced fees. Is this something transferable . When you look at private Equity Assets . I think it is. We saw it in infrastructure. Everyone gets the two and 20 model. Why not . Infrastructure, that is too expensive. We have broken that down. Now hedge funds have had such a lousy decade, you have seen more hedge funds being willing to negotiate if they get permanents to the capital. To understand why their investor is investing with them is kind of obscure, but you want to know what the client wants out of you so you note you are meeting them based on how much money is coming in and out. They are willing to negotiate with serious longterm people. Size is part of the issue. You have got to be a large investor, so i feel for the smaller funds. They are struggling. Yvonne talk about contributions. What you are getting for callisters is not what like you are paying for benefits. How does that change overall . You hit it on the head. We are very mature, over 100 years old, more going out in Retirement Benefits than coming in, and that will be the case in the next 20 or 30 years. Baby boomers are retiring, so we ay out a half billion dollars month in outflow. How that changes, instead of being the average cost buyer, we have to be an average cost seller. It makes Asset Allocation decision Cash Management is the first thing you talk about. Yvonne and you did that recently. We think that is one of the opportunities to be defensive with that rising equity market. We have made returns and we are in our market weight in equities. There is too much risk in the world. We want to be defensive moving along. Yvonne we might have lost betty. More about your investment in this part of the world, particularly in japan. Looks like we cannot we will in january conversation and talk about japan. You have been overweight with this part of the market. What in terms of catalyst are you seeing now . Is this right after the abe election . Corporate earnings are at records. We have been investing in different pension plan since the 1980s, so i have lived through the entire cycle. We are optimistic about abenomics. Even this recent election was an affirmation. It will not be a recent gdp, but japan will improve and grow slowly. China being so large, it will help all of asia. When you look at our world, we have the usa, that is a big chunk of the equity portfolio, then you have europe and the u. K. Versus japan and asia. We think the u. K. Is in a stalemate for time with the brexit. We have positive in europe. We think the recent elections in france show opportunity for france and germany to control the e. U. And do well. We are hoping to see better growth out of asia. The yen is a concern. We like japan. We like Corporate Governance changes, that they have modernize the pension plan and allowed it to diversify. Now we need to see the Japanese Society open up a little bit, not in immigration but i would like to see them improve the way women can work in the workforce and the way they save. Stop saving in debt and invest in equity. That will come with Corporate Governance. Betty we are back in two online. You can hear me again. Are onto asia. I want to bring in another reporter to the conversation, because we know there is going to be a busy week of earnings with japanese banks. Missable international reporting, the biggest of the lenders in japan. Lets bring in the Bank Reporter here, who has more. What are we looking for in these results . Ande have been talking to analysts over the last couple of weeks and the average estimate of the income will be ¥150 billion. That is down from the same time last year. There were some reports saying you get these things from time to time, and it could be higher. This is down year on year. So now the problem, it is the core business, making loans and deposits. It has become less and less profitable because of the negative Interest Rate policy squeezing the margins. The bright side, the middle east has been coming up better this time. You had major deals overseas which rate might have helped. We had some big returns with Companies Like sharp. They could call back reserves there. Forecast isyour down 8 compared to last year. There are about 50 on the way, so more keeping their own for the year, albeit conservative. Betty what about the fact we have seen the record, the nikkei 225 at these records, japanese stocks are soaring has that helped the banks at all . It does not help the core business, but because japanese banks have these enormous shareholdings, the own shares in client companies. It has pushed other governments to try and improve governance to get down these holdings. We think the base will be sales banks will be sold. There has been offset on problems from the oil business. Betty thank you so much. Jared allen on the japanese banks and on japan. I want to bring back chris from mcallisters. Before we get further, there is a big question, the japanese stock market, how much further can we go . Are we witnessing a correction in japanese shares . I dont want to use the word correction. It is tough to predict the markets, but we will call for a cause. The Global Market have gotten. Verheated call for a pause the Global Markets have gotten overheated. There is more red on the screen then green. The markets have really running through the summer and into the fall faster than people expected. They have gotten ahead of themselves, and we will see that pause to refresh. Pause to refresh. We will see. It takes time to figure out whether we are in a correction. In terms of a pause to refresh, in terms of governance issues, we have seen maybe more than a pause, chris. We have seen companies in japan whether you are talking about takata or kobe steel or the japanese banks, indeed Corporate Governance reform. I am curious again as the cio of callisters, how much do you think you can do . What is your view what is going on . You know me, i take a longterm view. We have been a Corporate Governance in japan for two decades. We have made incremental gains, but in the last year in the half a mile we have seen significant improvement. At the end of this week, i am going to tokyo to meet with the pension plan. Governance. Lobal what can we do to increase the awareness of corporate boards, make them more attentive. I would not have thought a decade ago we would have independent directors starting to be on the japanese boards. It is huge. Is that a milestone we expect to repeat over and over . No, it will be slow, but that is the first change. Having people aware of shareholder return will be a huge difference to the japanese economy and market. That is what will get the savers to start becoming investors, which is what they need longterm. Yvonne you mentioned gpis. How much loved to these asian punch it clout do these asian Pension Funds have . In china, activist investors, they have failed. It lead to friction between management and these for investors. What is your outlook . It is bad for the timeframe. The activist investors are looking at a company over a year to maybe three years. Then there is friction. What we are longterm investors, we will hold a company for decades. Ame thing with gpif we are not trying to make radical change or change management. We are asking them to have input on the board and for the board to hold management accountable. A simple concept, hold management accountable, set goals, measure them, measure whether you are achieving those in earnings and sustainability. Are you paying attention to how the Company Operates . Several issues you mentioned were failures in management to Pay Attention to the risks in the company. Being too shortterm oriented for shortterm gain at the expense of longterm process. So our discussion, we are able to have mental is it today . It is very slow, a dialogue overtime, and is raising awareness. Betty i am curious to getbetty your take on msci. They have a review of whether they should Ban Companies who dont allow public Voting Rights or unequal Voting Rights. We have seen this in tech Companies Like snap and over uber. Do you think they should be banned from their indexes . What i believe if you have to differentiate these. If you are a company and want people capital, peoples capital, you have to give them a say in the company. If you want blind capital, put that in a different pool. I blame really more the exchanges for listing these companies, and i really applaud msci for taking the time to take a look at this. I will take a dialogue with henry fernandez, call him directly, because we have been very active. I was disappointed when blackrock said they thought snap should be considered equal. It is not. The basic tenant of loading capital loading capital is you have a say loaning capital is you have a say what is done with it. I am interested in the mom and pop stores investing in their own money, and the need to vote their shares and say how management is performing through the corporate board. Betty thank you so much. Christopher aleman of callisters, cio in hong kong. Great precision. Still more ahead. This is bloomberg. Yvonne this is daybreak asia. I am yvonne man. Betty i am betty live. A look at the business flash headlines in hong kong united of a chinese steelmaker is ditching its name hna holdings. They will call themselves Cwt International based on a singapore warehouse it bought. The new name will better reflect its strategy. And logisticsy have become hna holdings for businesses. Yvonne south korean media reports the government plans to sell if 90 stake in foodie bank until next year. The they say they have been forced by the resignation of the ceo over eight kindle of the hiring of children of government officials. The draft is submitted on sunday. Companyapanese gaming starting to a high after a forecast from the current fiscal year. Operating profit 800 million up from 360 million. Anothery are buying studio that makes storybook games for smartphones. This is the largest in five years and is intended to fuel expansion outside asia. And of course we are seeing leaders of the asean nations arriving for the summit of two days of talks. Yvonne yeah. Now we have rishaad and heidi. Stocks onsia pacific the slide. The aussie dollar falling amid political upheaval in camera. President trump talks tough on trade and enters the last leg of and offered to mediate in the South China Sea. I am Rishaad Salamat in hong kong. Haidi i am haidi lun in sydney. Alibabas annual shopping bonanza generates record sales with buyers from more than 200 countries. This is Bloomberg Markets asia