Appropriate. Former United Nations secretarygeneral interest which pope francis is in mexico where he delivered a massive stadium rally on behalf of fighting the drug trafficking. That is bloomberg news. Emily this is bloomberg west. Last years worth stocks are this years biggest losers. A dramatic revaluation. Groupon shares get a huge boost on news that alibaba has taken a big steak. Ake. Major investors meeting out largecap technology out of their portfolios. The major revaluation of Technology Stocks underway in 2016. We will focus on three companies in particular, netflix amazon and activision blizzard. When the onlyme thing they had in common was the description as growth stocks. Businesses bleed together. They all can pediatrician content for us streaming video. Into 2016. From 2015 all the stocks have been slammed in 2016. More than 20 declines. What do we read into this . David, should we be thinking of this as a sector wide story . I just came from giving a speech. One of the things i was saying about the world we live in is that industries no longer exists. Everything is bleeding into everything else. A companys amazon . You have Amazon Web Services but also s software and they make tv shows. They are an opportunistic company that does everything. Technology is sort of infusing all industries. Would you agree that we cant really think of technology as a separate industry anymore . Cory technology is what happens a company like cisco is a Technology Company because they empower other people to use technology. About companies where the end product is consumed using digital bits and bytes or an activision those a very different kind companies. Was as you read it growth stocks. That may be more useful way to look at things. We see very different companies. Activision you have very big and successful company. Profit even as revenues are shrinking. Revenues are growing rapidly. Very different characteristics of these different companies. Emily although each of these companies has their own individual story, if you look across the Board Technology has taken an incredible beating compared to other industries. Sherry youre right that technology has fallen further. In the lastn faster couple of months than anybody else. It is still not inexpensive. Compared to the s p 500. That is really the other thread that is used by the companies that you mentioned set by the market. High valuations this year have been a recipe for falling prices. Emily they all overlap. Should we be more concerned about their strategy in this particular space given how much you have to invest and how hitrtant it is to have after hit after hit . How many house of cards can netflix have . How many transparence can amazon have . David i dont see why that should stop now just because we are in a stock market downturn. Frankly those companies have what it takes to succeed longterm. Theseal issue is companies were bid up so hugely in recent years that we are in a. Of repositioning. They are going to take a hit. Theyre taking a hit from a very high position. i am very slow to ascribe things to changes in the market. I think changes in the underlying business are more important. All aspects of commodities go with the glass halfempty. When you look at a list like this. The companies that have lost the most on a percentage basis. Tesla is down, two things. More stocks are down the just the nasdaq itself. The core weight of nasdaq will be suffering or more. , tesla, this economy western digital, those guys have really suffered this year. Saw tesla down 36 . Western digital down about 29 . That is a lot of pain for companies with prospects of that changed dramatically. The Company Looks at minor changes as dramatic indeed. One point you have made is that even as tech stocks have been coming down they are still brought the expensive. All three of these stocks actually closed in the green today. Is this really going to be a story for the rest of the year . That is a fair question. Narratives of the market change from day to day. It is hard to extrapolate what is going to happen by this point in december. Make any market predictions. Is thing that has changed the valuation. It is not the prospects of these company systematically changed. They are still the copies that we thought they were. Changed ishat has the market appetite for risk. The risk is reflected in those high valuations which means the companies dont meet or exceed what investors expect of them. They will get punished. Emily we have seen their fourthquarter earnings reports which definitely caused investors to get a little antsy. David in up times Good Companies can become fans. Ds. Amazon have been fans in the markets who is not illogical that they should be dropping. But they are still incredible businesses. I think they got a little more attention than they deserved earlier on. Emily thank you very much. Selloff in the technology, the latest regulatory findings from several companies confirmed there is less enthusiasm for apple this year. David einhorns greenhorn inital slashed its stake apple. Carl icahn also sold 7 million shares in apple. Owns more he still than 45 million shares in the company. Apple stock is down more than 8 . We will dig into the companys latest multibilliondollar Debt Offering later this hour. Apple is not the only Technology Stock getting weeded out of portfolios. Druckenmiller cut the stake in facebook. The former internet darling groupon making a comeback. Making wall street take notice. Check out this chart as we had to break. The nasdaq biotech index seeing its biggest twoday rally since october. Led by buyer jan and regeneron pharmaceuticals. Itsy at t is phasing out uverse tv service. It is pushing customers toward its newly acquired directv. Tois giving up its plan compete directly with cable through telephone lines. It has the benefit of lower hardware programming costs. This shift is the first part of a plan to create a home getaway. Within three years it will consolidate all at t services and act as a central hub for any device. Toyou didnt make the cut attend Warren Buffetts annual Berkshire Hathaway shareholder meeting, you can still catch the action. Offer the annual meeting on a webcast. It will be there for ondemand viewing for 30 days. Last year the meeting lasted seven hours. Groupon shares surging for a second straight day after significant investment by alibaba. The stocks jumps to some 83 in just two days. It is down over the last 12 months. The chinese sees commerce giant bought a share in groupon. What does this mean for investors . What is groupon now . Gil it is mostly a goods site. Most of the revenue comes from just selling merchandise off its website. The other has these local deals that as it was originally. It is the sales of goods that are doing very well. I would say the more interesting part especially with alibaba is the local deals site. Emily they said they bought a very small stake in groupon in order to share ideas. We are prepared to share. What in the world can alibaba do for groupon the justifies a huge stock jump like this. Gil is really what groupon can do for alibaba. There is a strategic any tactical imperatives. Alibaba is a company that thinks in decades. The company that was founded in 99, he wants them to your rounded three centuries. Planning horizon is a competitive advantage itself. That is how he sees the entry into the u. S. Market. A longterm imperatives. What he is doing now is planting seeds. These are seeds that he is planted in order to learn about the u. S. Market. See what it is about. When the full entry into the u. S. Market is ready they will be prepared. The tactical side is that they are run like a hedge fund. They took a look at zulily and then invested. They knew there was value that it was later realized by qvc. They are in the market. Stillealize there is value in that market. You have a longterm strategic aspect but also the shortterm practical hedge fund aspect when you look at what alibaba is doing. David i completely agree. They are like a really wellinformed tech savvy Portfolio Investor that these Deal Companies are very common in china. Im sure there run at a profit. They so that groupon was really cheap compared with their analysis. They have 850 million in cash. They have 80 Brand Recognition in the United States. This is amazing for any company. At the time their market cap was only about 1. 3 billion. Alibaba is just a smart investor. I think they will do well. Emily is interesting that they are taking a big stake in the company for not buying it williams we think the company is undervalued. Our focus is a team is not just on things like acquisitions are focuses on building a great business. Longterm what would have to do no matter what. We see the longterm potential in local and unlocking the value there. That is what were focused on. So many people think of groupon is this daily deals site. How optimistic are you about groupons longterm future . I would because this. They are no longer driven by the local business. Most of the money is going from the good citizens is very hard to make money. Amazon at their scale doesnt make money selling directly. Is not necessarily a very profitable business to be growing. They have people going to the website but not necessarily sure that in itself is worthwhile. The groupon perspective, alibaba putting a stake in it means it is not going to zero. Theres value just in knowing that. If you are thinking of betting against groupon. Emily alibaba has been touted as a company to make huge tech purchases. Thank you so much. Rise is onck on the semiconductor. After its takeover target fairchild semi rejected a higher competing offer from chinese investors. At least one analyst has noted thats decision to go with the lower bid is most likely a jesuit the middle policeman wouldnt have gotten approval of necessarily. Fromarkable consideration citigroup. Teslas battery business gets a boost. Well take a look at what the company has planned for 2016. The nasdaq 100 just had its best rally of the month. The movers so far are gilead and. Isco more of bloomberg west next. Gucci, product, amazon . Wills a rumor that amazon launch its own clothing line. It is a ready made inroads into the fashion industry acquiring several fashion sites. Of 91 from the previous year. Amazons Vice President says a private label fashion line waiting to fill the gaps left by other brands that refuse to sell with the etailer. Analysts at citigroup are saying alphabet should buy aig to expand into thin tech. Aig has come under pressure from activists to improve its accountability. Googles Parent Company has been giving it so into the insurance market. Layout the plan. Sonali if google were to buy aig its market value is more than 64 billion. The enterprise value is more than 90 billion. Googles biggest deal was 10 billion dollars when it bought motorola mobility. A number of companies could get some help from big data. Hard deal for google. She has got it right. Aig can use this. Almost any company could use the infusion of energy that google would give them. Googlee any reason why should remotely contemplate such a thing . Of course not. Google will get into insurance by building something from scratch. A bige time they bought old company was motorola and it didnt work out for them. Why would they do it . Theres no way they would do it. Emily insurance is an industry that has not been disrupted by technology. I keep hearing about insurance startups that are trying to disrupt the industry. What is actually happening in this arena . Sonali they need disruption. Margins are freaking out. People are having to raise rates for coverage. People would like to use the data to figure out how investors are behaving. How to make the business more profitable. You have say cyber insurance. You have Companies Getting hacked by cyberattacks you will need more intelligent than what a typical underwriter used to have. Emily if you think of insurance is one of the last frontiers of tech disruption. David i think it makes perfect sense. The industry is going to change it is just a matter of who is going to change it. The insurgents or the incumbents . Is some Small Company will come along and do it way better with far more efficient resources not all the old overhead the giant like aig has. Thank you very much for joining us today. Iphone when to your youre done with it. We will go behind the curtain at the recycling center after this. You can listen to us on the radio on bloomberg radio. More bloomberg west after this break. Emily i am emily chang, and this isemily bloomberg west. Solelyjoined by juliet saly with a look at headlines in asia. Saudi arabia and russia have agreed to freeze oil production. They will keep output at january records. The deal includes venezuela and qatar and is the first coordinated effort with producers to counter the price slump. Saudi arabia is open to further actions, but traders are not convinced that others will pull their weight. Dramaticmeant equally news at woodford petroleum, who announced a 99 collapse in full billionarnings from 2. 4 dollars a year earlier. Is rolling out a boost in spending measures, making money available for local governments to Fund Infrastructure projects. Panasonic plans to speed up acquisitions to meet its 2018 revenue targets. The company is aiming to spend nearly 9 billion in order to generate 87 billion in annual revenue in the next two years. Emily quite an aggressive strategy. It seems like the companys focus is changing away from consumer electronics. Is that how you read it . Reporter absolutely. We have seen the president making this push to move panasonic away from its core business and focus on growing and thech as housing batteries it makes with tesla motors. Pay 1. 6 agreed to huffman. O fridgemaker at yesterdays briefing, they said panasonics previous acquisitions have not been about changing the company. This new strategy is all about the future of technology. Panasonic is introducing two new solar panels. It introduced of at its event in new jersey yesterday. They are expected to boost power saving for consumers and boost earnings as it moves away from consumer electronics. Emily thank you. This is your global news 44 hours a day, powered by 2400 journalists in 150 news bureaus around the world. I am emily chang. Apple in focus today with by 48. 8ting its stake million shares. Is selling billions of bonds. Securities to sell and bonds maturing in 30 years. , our bloomberg reporter, adam, and tim culpin. Still with me, david kirkpatrick. Icahnwhat is your read on and i were cutting back . Kind of reflective of the tough quarter apple had. The stock price has been reflective. A few different catalysts for apple stock in terms of getting it going. There is either a strong earnings performance or new category. We just went through an earnings season where they are showing signs of slowing down. People are willing to see what the new product will be. Emily tell us what we are expecting in terms of rollout. We have heard a potential march event, the iphone 7. This year seems like it will be an update to the existing product category. Last year, there was a lot of attention to apple music, apple watch, apple tv. This year, you see new iphones, ipads. Do you think we will see agressive updating of the watch or a new version . We have not seen it yet, but there are expectations it will happen later in the year. It has been compared to how it is with the iphone, how the original one was a little thicker and heavier and over time, it slammed down. Will bring in tim on this incredible story he wrote about iphone recycling. First, apple has so much cash already. Why sell these bonds . It gives them more cash in the United States is one thing. A lot of their cash is overseas. This will allow them to do a buyback aggressively and they can do some acquisitions as well. For a company in apples financial position, the markets are favorable. They can get the sort of cash for next to nothing. And effective lending from some of the money outside of the u. S. They are like a bank. One thing they are doing that is unique in this bond offering is the socalled green bonds which are loans that have to be used for certain Renewable Energy projects, sort of an emerging deal to give it a boost. Emily tim, you have a story out today. Apple has a dedicated facility to destroy not only iphones but laptops and ipads. Tell us about these facilities. There is one in hong kong you go very in depth on in what they mean. Apple is not the only one in the recycling program. Lenovo, all these companies trying to recycle goods. Apple is far more strict and rigorous than any other company according to my report. Having spoken to various people in the reverse supply chain, they are calculated about the process. They are secretive about it in terms of the methods they go through. Goal is to, the reduce the amount of landfill for these products. When a shipment of old iphones comes into this factory in hong kong, but the first thing they do is weigh it. As they go through the process of pulling it apart and putting it into component pieces, they actually weigh it at every step of the process. They send this data back to apple to ensure it is being done correctly. Processnitors the rigorously throughout the process. The process for building a phone, they do very similar for destroying a phone. I can imagine another reason apple might do this. We have seen pictures in the past of children disassembling products in a big pile with toxic materials. Apple has gotten so much grief for issues regarding their workers in china and elsewhere. Be onesuppose it could of the motivations here, that they do not want to take any risk they might be seen to be endangering the lives of people disassembling . That is very true, a very good point. I spoke to lisa jackson, the head of their environmental division. She admitted that people expect a higher standard from apple than they expect from others. They have a higher standard for themselves. They are rigorous to avoid chemicals getting leached into landfills. They have to be put in controlled facilities for longterm storage. The other reason they are rigorous is they do not want to see any parts of the iphone get out into a secondary market. You can imagine the strong market for any of the components inside a device to be resold, repaired, or reverse engineered. The want to make sure they are controlled in that. Emily lisa jackson has become more prominent at the company. How much of this is because