Saying his call was wonderful. The white house was already trying to keep the record under wraps. Thecycle Fitness Company third worst unicorn debut since the financial crisis. Woworks cash plans go awry. Shery lets get you started with a quick checkup on how markets closed. It was a broglie risk obsession with stocks losing ground, at treasuries advancing, and the dow lost 80 points. The s p 500 lost. 25 which was the fourth decline in the last five sessions. We started lower given the whistleblower complaint in that impeachment inquiry against President Trump was released, but then, this was exacerbated after u. S. Officials talked about that temporary waiver for u. S. Suppliers to send their products to huawei. It could probably not be extended. Market sentiment was rattled. The nasdaq fell. 6 . Energy was the biggest loser despite the fact that we did see crude prices recover after we heard reports that the u. S. Would be sending military equipment to saudi arabia. U. S. Futures at the moment not doing much. Lets see how things are shaping up in asia. Sophie asian stocks are set for a mixed start with the regional benchmark little changed. A busy calendar next week. Japans sales tax hike, the rba decision, chinas 70th anniversary, and Companies Going public are getting a very hard reality check. Today, we will get industrial profits for august from china, likely to show that rebound we saw in july, and also, the chip industry on watch after the downbeat outlook by macron which has slashed its capital micron, which has slashed its capital spend. Given is in view signs the u. S. May not renew the temporary waiver. Paul. The lets check in on first word news now with jessica summers. Jessica. The u. S. Slaps sanctions on Chinese Companies it accuses of shipping oil from iran. Rates for vessels capable of carrying 2 million barrel cargoes of crude jumped 19 . Shares also rose. Sanctioned Costco Companies includes shipping. Thehe u. S. Disregards legitimate rights and interests of other parties and wields the state of sanctions that well. It goes against the trend. Jessica hong kongs embattled leader, carrie lam, says it is up to her government to find a solution to the months of unrest in the city. She told a public event she accepted responsibility for the turmoil and that people on both sides are hurt and angry. Her audience continually asked why she will not agree to key demands from the protesters. They called for her to resign. The worlds from Nuclear Watchdog says iran its capacity further, installing powerful centrifuges in contravention of the fragile deal with local powers. The International AtomicEnergy Agencys report has been seen by bloomberg and it says iran is preparing additional measures that will allow it reconstitute its stockpile of enriched uranium. Output in singapore plunged by the most in four years as the manufacturing downturn worsened. Industrial production dropped 8 from one year earlier, the weakest since the summer 2013 and worse than all four in a bloomberg survey. Plunging 24. 4 percent from one year ago. That is the worst reading for the sector since the start of 2012. Global news, 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am jessica summers. This is bloomberg. We have had a first look at the whistleblower complaint that called out President Trump for his controversial phone call. The document alleges surprise and alarm among white house officials. Joe sobczyk has been covering these extraordinary developments over the last 48 hours. Give us some details from this whistleblower complaint. Joe the whistleblower complaint completes a wider picture of the events surrounding that call both before and after. The most significant points that are made by the whistleblower are that the president had pressured the leader of ukraine to conduct some investigations, restart some investigations involving joe biden and his son, hunter biden, and that this had disturbed multiple white house officials who had been raising concerns about this, that it was then handled by white house lawyers. Officials were told by those lawyers to put the record of the ,ll in what is lockdown moving into a separate to handle system classified information involving National Security. Despite the fact that the call did not remotely affect any National Security issues. Further, our further attempts to otherwise shield the call from other parts of the government, but nonetheless, certain reports did circulate, and more than one person, according to the whistleblower, who expressed alarm and concern t it might have revealed the president abused his office for personal gain, so that is where the nexus of the investigations will be going as we move forward. We also heard from trumps acting director of National Intelligence in a congressional hearing. Where do things stand after that . Who testified, did light shed a great deal more light on the procedures. Did attest to the fact that the whistleblower needed to be protected. The Inspector General of the Intelligence Community found that the complaint appears credible, but what is going on now is democrats say that this has given them a roadmap for further investigations. There were a number of people , primarily Rudy Giuliani as well as william barr, who were involved in this. That the democrats will be seeking to question them as well as finding out other officials who might have been might have had knowledge of the call and raised concerns about the call. They will be trying to get those names and get them before the committee to testify, to build a case. Inquiry is going on now in the house. Shery Speaker Pelosi is calling the actions of the white house a coverup. What are we hearing from the republicans so far . They are still sticking with the president. Joe so far, we have had a number of republicans vigorously defend the president , notably his close ally, lindsey graham. A lot of them are at this point staying rather quiet. The call and the whistleblowers complaint as hearsay, that the actions do not amount to any impeachable offense, but at the same time, there are a number of them who are expressing concern and a desire to look into it more. Nobody on the republican side has come out in favor of impeachment. That is still something no one has been willing to go that far yet. They are biding their time in some ways and congress is coming up on a twoweek recess in which they will be going back to their home districts and states or they will be hearing more from their constituents about where the voters think this should go. Congress editor joe sobczyk in washington, thanks for joining us. Still to come, the third worst unicorn ipo debut since the financial crisis. Pelotons rocky start, ahead. Shery this applies snub for china. For china. Rise snub this is bloomberg. Shery you are watching daybreak asia. Ftse russell is taking a pass on chinese bonds. It will not add sovereign debts to its bond index. The move could dent chinas efforts to bring more Foreign Investors into its capital markets. One investor who anticipated this decision is denise simon, cohead of emergingmarket debt. She joins us here in new york. Why did you think that this was not going to happen, at least for now, although perhaps it is inevitable . Denise china is the thirdlargest bond market in the world so you cannot ignore it. I just look at this more as a delay. Againstook at china, the emerging markets i invest in, it brings up a different opportunity in that it is uncorrelated to the markets i look at. From a valuation perspective, it is attractive for developed Market Investors but not as much for emergingMarket Investors at this stage. Time is also coming out a when the chinese policymakers have tried to open up the markets, right, whether it is bond markets, Foreign Investment limitations had what are the implications of all of this as policymakers are trying to open up the Financial Markets . Denise i think they are. It has already been included in the bloomberg ag and it will be included in the jp morgan emergingmarket local indices next year, so i think that that opening up is happening. I do not think that not being included in it right now is going to really set that back significantly. Sophie Bloomberg Paul bloomberg best weak man a story about the record defaults in chinese bonds, mainly due to a wall of dollar deck. Does this cause you any concern . Denise first of all, we are looking at the renminbi Government Bonds. On the corporate bonds, the leverage they built up over the last many years, it is not unexpected, and in fact, the fact that they are leading Companies Default is a positive over the medium term. Just moving away from dona into e. M. , you like dollardenominated debt, but where do you see it heading . It does not seem to matter that the fed is easing but it is grinding higher. Denise i dont think we are necessarily seeing the same kind of trend that we saw earlier this last year. For emerging markets, the Chinese Women be is almost more important for financial conditions for emerging markets. Shery what are financial conditions looking like . Denise globally, they look easier. In emerging markets, with inflation subdued and the fed and the ecb easing, we are seeing this opening up space for emergingmarket Central Banks to also ease. They, we saw mexico cut 25, second part in the cycle. I would expect a lot more cuts in latin america. I think they have room on the Monetary Policy side. In asia, we saw the central bank of philippines cut this week and i think theres more room. Indonesia, we are expecting cuts there. I think that we are going to see Central Banks have this room to use. Shery has em performance been affected at all given this trade war flareup that we are seeing recently . Denise the markets have been living with uncertainty for a wild now and what has been important and what is supporting emergingmarket assets is the easier financial conditions. I think this will continue. Yields are low. They are most likely going to stay low in the core markets. We have 30 of the global bond markets trading with negative yields. I think emerging markets are a natural place to go to pick up the old without taking a lot of credit risk. And in particular paul what sort of duration . Sorry, please continue. Denise i was just going to say, one of the overlooked areas of our market that i think are attractive are u. S. Dollardenominated corporate bonds. Asset this is a growing class. There are two truly an outstanding. It is actually larger than the dollar sovereign market, and i think there are a number of characteristics that are underappreciated. They generally have less leverage than their developed foreteers and they borrow capex from Investment Purposes to refinance shortterm debt versus highyield borrowers in the u. S. That are looking to leverage up to buy shares or to do leveraged buyout. Is quality of the borrowing different, and they are generally shorter duration around five years. You can get attractive yield pickups versus developed marketeers. Spreads around 300 to 400 over so it is an attractive place in this low yield environment to pick up yields, not exposed to a lot of Interest Rate volatility or spread volatility. Paul when you are looking at corporate debt around the e. M. , do you sometimes have a bit of concern around transparency . We have been running a story about a firm in indonesia, a textile firm, that which issued some dollar bonds, which . 15tly slid from . 85 to in the space of 15 months so you do have to be careful, dont you . Denise it is a large universe and you have to be comfortable that you have access to management, that you have Financial Statements that are released under international standards. You need to be selective. The default rates, when you look at emergingmarket corporates, actually have been quite manageable, and in fact, lower than what you have seen in the u. S. Highyield market. Paul Asset Management cohead of emergingmarket debt, denise simon. Thank you so much for joining us. Coming up next, hong kongs leader faces the people as protests range for a fourth month. Carrie lams dialogue session, next. This is bloomberg. Paul this is daybreak asia. Is daybreak asia. I am paul allen in sydney. Shery i am shery ahn in new york. Paul hong kongs chief executive, carrie lam, hazmat members of the public, trying to find a way out of sometimes violent protests that have continued into a fourth month. Stephen engle has been covering it since the beginning. How did carrie lams first dialogue go . Stephen she is meeting with what many in the audience were some were even wearing their masks. There were 150 people in the audience in this Town Hall Session last night so she did meet them facetoface and that has been one of the biggest criticisms of carrie lam over the several months situation, if you want to call it that, which has devolved into violence on the streets. Steadfast inetty her insistence that the other four main demands of the protesters are not realistic to meet, however, she did say the entire unrest is caused by the governments work in amending the extradition model. She took that upon herself. The extradition bill was the government tried to fasttrack it through the Legislative Council earlier this year. That was met with stiff resistance within the legislative chamber itself and it morphed onto the streets and then the several months she did not withdraw it officially, that led to more anger on the streets. To went on to say we want make it clear there is a bottom line. You have to take the consequences after breaking the law. That is why we say we cannot accept some of the five demands. You see the five demands right there. She met number one of course after violence erupted on the streets however, establishing a commission of inquiry is a big point of contention. The protesters watched this independent commission of inquiry known as the coi, which would be separate from the Complaints Council which carrie lam is relying on to address some of these complaints about alleged police brutality. Protesters feel, however, that it cannot be impartial. Shery is there any indication that carrie lam will give in to any of the other demands . Stephen it is about the rule of law. Steadfast in her assistance they must keep the rule of law. I want to bring up another point, and that is there has always been speculation that perhaps Mainland Police authorities or paramilitary authorities across the border in could possibly come in. A number of people i have spoken to in the lead up to this special show which we will be airing called hong kong on edge my they feel that this is saber rattling on the part of beijing. The Hong Kong Government could invoke these emergency powers. Basically, invoke martial law. Employee martial law on hong kong to keep the violent elements of the protests down. However, i spoke to the former security secretary of hong kong, who is now the chairman of the hong kong peoples party. Formera lacko member, security secretary. She told me as part of my reporting for this show, she said it is not as easy as people think for invoking this emergency ordinance. Are wideranging. We do not need to invoke all of the powers. If it is really necessary, we will only make such regulations as are necessary to restore order. It is a common law jurisdiction and we are all too aware of legal challenges we could face, so i think a lot of it concerns already expressed overblown stephen the other big issue i mentioned at that town hall meeting was the commission of inquiry, which the protesters want. The other person i interviewed for this one hour special coming up, that was michael. He is a hong kong lawmaker as well as hong kongs deputy to the National Peoples congress. He told me that he has been urging carrie lam as well as urging beijing to give in on one more of those demands, and that is setting up an independent commission of inquiry. He said that will be the only way he sees a way out of this mess right now because it could help placate the more radical elements of this protest movement. Shery stephen engle, thank you so much. We do have that special onehour program airing later today. That is hong kong on edge. At 2 00 p. M. Sydney time, midday in hong kong, and 8 00 p. M. Here in new york. A quick check of the latest business flash headlines. Mitsubishi u. S. J informed usj informed us they will eliminate 60 employees, 40 percent of headcount in hong kong, singapore, and sydney. Of their employees may leave if they decline offers to relocate. Sg is the latest to cut. Paul Credit Suisse will rule on a surveillance scandal as they try to find out who is responsible for the embarrassing issue. Top Swiss Law Firm has interviewed Senior Bank Officials and is reviewing whether there surveillance of the departing executive was justified. The former Credit Suisse boss says the current ceo should be fired if the claims are approved. Shery shery Delta Airlines is expanding its footprint in south america in a deal with in the regions largest carrier. Delta will by 20 stake in chilis Airlines Group chiles Airlines Group. Ties. L help to unwind its coming up next, a bumpy ride. A bicycle fitness startup, peloton, makes its public debut with one of the work start since the financial crisis. The ceo admits some disappointment. Here, it all starts with a simple. Hello hi how can i help . A data plan for everyone. Everyone . Everyone. Lets send to everyone [ camera clicking ] wifi up there . Ahhh. Sure, why not . Howd he get out . a camera might figure it out. That was easy glad i could help. At xfinity, were here to make life simple. Easy. Awesome. So come ask, shop, discover at your xfinity store today. Jessica this is daybreak asia. I am jessica summers with the first word headlines. Japanese automakers are calling on the government to do more to support the industry after the limited u. S. Trade deal left vehicle tariffs nearly unchanged. The toyota president led appeals for extra help amid the worsening business environment. Japan and the u. S. Reached a basic trade agreement, but autos remain a key issue and tokyo fears President Trump may still raise tariffs. Adding toll skipped asian bonds into its flagship two asiann bonds into its flagship index. Bloomberg intelligence estimated that inclusion into the wg b. I. And jp morgan indexes could drive 130 billion into chinas bond market. Says it has taken steps to improve its defenses against cyberattacks issued via some tractors subcontractors computer systems. Rollsroyce is among four targets from china. In january, airbus said a cyber breach allowed hackers to access employees information. Boeing was hit last year. Arabia is changing one of its most fundamental rules. It is dropping the dress code for foreign women. The dramatic move is part of the kingdoms attempts to boost tourism as it tries to diversify the economy away from fossil fuels. Foras been mandatory attire decades although the rule will now change, foreign women will be instructed to wear modest clothing. It is optional. Will be cleared in the online visa applications. Some women would like to experience it, and they see it as some will decide not to wear that. Jessica global news, 24 hours a day, on air and tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. I am jessica summers. This is bloomberg. Shery lets get to sophie in hong kong for a checkup of how we are setting up in asia. Below 57, brent below 63. It is set for a weekly decline. A choppy stretch for your crew. Aramco restores output faster than expected. Given the sharp moves we have are in oil, some investors questioning the decision for aramco to list as soon as november against the backdrop of a decline in oil demand and heightened security concerns. Brent willrecasts trend lower than the 60 per barrel next year which could be one reason aramco is rushing ahead with augustine, so analysts will have less than three weeks to prepare their preipo reports with aramco to announce intentions on october 20. Paul. Paul lets move on to peloton now. They reported the third worst unicorn debut since 2008. It fell as much as 14 after raising just over 1 billion in its ipo. The ceo told bloomberg he is upbeat about the future. The biggest thing is we are playing the long game. We see this as literally building millions and millions of subscribers around the globe for the coming years. We have the money to do that. After fully funded todays primary. We are feeling confident. Lasten you think about the couple days and the last couple weeks, you mentioned the markets. Obviously is on everybodys mind. It is a tricky ipo market to say the least. Do you have a sense of where the miscalculation was, if there was one . John this is my a fundraiser for peloton, and it has always been eighth fundraiser for peloton. Those believers and nonbelievers. The people who believed, for every one of the rounds, for eight years now, have been very, very, very happy, and we are going to continue to delight the Capital Partners who invest in us. You mentioned fully funded. What are you going to do with some of that money . John we are doing things like building a 50 Million Television streaming studio in new york city, another studio in london, where we will higher our language and doctors so the german instructors are being hired out of the london studio to stream to our German Market which will open in 60 days. Content,vesting in new new verticals, and we brought it to market. Canada, the in u. K. , and germany. We are in investment mode. You are losing money. Its like, no. Its semantics. We are investing money and we feel good about what we are doing. How do we feel about the Consumer Market . We are in a bull market. We continue to be, other than some of the volatility we are experiencing. What do you hear back from your customers, and maybe more importantly, your potential customers about their willingness to write a big john one of the most important things we think about peloton is the optics on affordability. If you have a peloton life, it is an insane value. It is an insane value. Fitness has been a recession proof category. More dollars went into fitness in 2008 and 2000 nine as they did every year, so it is secular growth over the last 15 years, and we think if we create the best value in fitness, ride your bike, divide that by 39, you are paying a couple dollars for a workout. That is orders of magnitude better than going to the boutique fitness world and we will show over time that it is even better value than going to the gym. You have described the company has all sorts of things. Technology company, media company. It obviously does a lot more. Where will you be primarily spending money . Is this a content push that is coming . We cannotur core, Hire Software engineers fast enough so we are a tech company at our core. We had to go into media. We have producers and we hired this content officer, so she is going to build one of the most special Media Divisions in any category. At our core, the investment will go into technology. We will open Retail Stores and logistics. It starts to show how multifaceted peloton is, but Software Engineering is our core. Shery that was the peloton ceo speaking to jason kelly. For more on the market reaction, lets bring in su keenan. Su, of course, the slime, the stock slump, is huge. Slide, theugh the stock slump, is huge. Su very rough for them. There were questions about overvaluation, and they certainly proved to be the issue as we get into the trade. The peloton plunge echoed uber and. Lyft and lyft. The reaction was immediate. You had a large hollywood Entertainment Company pulling its ipo, yanking it. It was scheduled for later this week. Weworks was scheduled for later this week. That has been delayed. That shows there is a chill in the air, if you will. Spokespeople saying they will evaluate the timing. That is very much the issue here. If you look at the recent ipos this week, it has been a very difficult week for those ipos, and it sort of underscores the Chilling Effect that we have seen some of the negative you have the price of success. The negative reaction to some of these very big ipos, which by the way, are a cash king for investment banks in terms of bringing these to market. Be a yes, it was meant to year for promising launches. So how much of the reaction we sught to saw to peloton debut was a reaction to the broader trend in the market of discontent . Su it looks like the ceo was surprised. He talked about believers and nonbelievers. It is cold feet and Cold Shoulder that these ipos are really dealing with. Lets go into the bloomberg. The mega ipos have been underperforming. If you look at these in the past week, in advance of this, it has been dropping. Take a look. Some of the individual ipos pull up one of these stock charts, and these are reflections of how they performed in the past week. Look at this. Smile direct, one of the ipo disasters in the past week or so, down 29 last week alone, down more than 40 since its ipo offering. Look at the other holdings, which was anticipated cybersecurity launch. You know the story about lyft and uber and pinterest, all of those down in the past week, so they set up a treasurers environment for an ipo to be offered, and that may explain why you are seeing endeavor, wework, polls. The early pulled. Tiger global anticipated they billion dollars profit from the launch. There are many investment banks that are also looking to theeoff we are seeing First Investment bank writeoff its anticipated revenue from the w peloton from the wework ipo. Paul thanks very much for that. Another highprofile start facing ipo headaches is a worse wework. A 6 billion financing package started to unravel after the initial offering was scrapped. The s P Global Ratings has cut its outlook to negative. Started to reporter allen joins us now from San Francisco. What is the latest chapter in the wework saga . We are looking to see how wework is going to make it work through the rest of this year without the cash it expected to get from the ipo that has now been delayed. Companyd about the which had a Credit Facility lined up at they would get access to if they had a successful ipo and raised 3 billion. Obviously, with the tumult of the past week, that plan has been delayed. We reported earlier this week, it is likely the ipo will not happen until 2020. Wework has to go back to the banks and trying to figure out an alternate loan basically. They have banks lined up to get them something along the lines of 3 billion if they are able to get extra equity, and that may come from softbank or another private funder. Shery in the meantime, they are trying to get some of their own money and selling some assets. Including the private jet. Tell us about that. Some of these assets may be more symbolic with anything else but it seems like the coceos are interested in making a bit of a statement about some of the things they are selling. In addition to three side businesses that wework has acquired in the last three years, meet up, conductor, and manage, those are up for sale. They are selling the jet that they used for the former ceo to get around. 60 million is not a ton of money when you talk about wework likely losing 2 billion in the next year so it seems like it is a bit more of a symbol than anything else, but you are right. They are prepping for other ways to cut costs. Likely job cuts in the thousands, and this is a company that is 12,000 people big, so this will be some pretty serious changes up ahead. We do not know the details of that yet. Shery you talked about potential financing coming from softbank. , Masayoshi Son, the founder, Masayoshi Son could we see wework being made an example here . That might end up being the narrative coming out of this. Things are moving around pretty quickly and we are getting a sense of how this is going to shake out. The new ceos have been in talks for two days. It seems like there is an interesting now to have wework be a symbol for what happens if governance gets to light, if a ceo is given too much money, too quickly, and is allowed to run wild with 12 billion of funding available. Shery we are seeing some changes within the company itself, hearing about executives leaving. What do we know about reorganization within wework . That is another thing leaders are trying to put forward. I am sure they would collect cleaning house. They think that there are some executives at wework we reported on a couple of departures including the chief product officer, the vice chair. These are people who have been at wework for a long time, have close, personal ties to adam neumann france with him or in the case of the chief product officer, the brotherinlaw of Adam Neumanns wife so there is an interest in time to have a changing of the guard and theres highprofile departures and we would expect larger numbers potentially of more middle ranking employees in the weeks to come. Shery thank you so much for the latest on wework. Coming up next, brazils top diplomat tells us how he is making the most of u. S. China trade tensions paired my exclusive interview with the foreign minister is next. This is bloomberg. Paul we are counting down to asias first major market open this morning. Japan opened 14 minutes away, 13 minutes and eight seconds, to be precise. Currently higher by. 5 . We have got futures. Australia pointing higher as well. This after modest declines in u. S. Equities. This is daybreak asia. I am paul allen in sydney. Shery i am shery ahn in new york. The continuing trade tensions are putting many countries in a tight spot as they juggle their own relations with the worlds two largest economies. However, the foreign minister of brazil says he is not too concerned. I spoke to ernesto earlier today in an exclusive interview and asked him about president bolsonaros Upcoming Trip to china. We have infrastructure investment. The trade is trying to expand our trade in agricultural or agriculture products. So there is Technology Innovation that goes beyond the question of 5g so there is a lot to talk about. Shery do you have any big announcements he continues at the moment that probably will come next month . Ernesto well, a few something in the infrastructure area will be at the core in inms of Chinese Investment brazil, which is very important for us. A lot of strong lack of infrastructure. Brazil needs to catch up in that area, so any investment is welcome. Energy as well. That sort of sector. Something there in that way, and also, i hope so. Something in terms of new markets for our agricultural products. Coursewe have seen of these ongoing issues with china even before president bolsonaro took office, and during his election campaign, he was critical of the chinese dominance in key sectors in brazil. Has the administrations view changed and evolved since then . Ernesto basically, what we see is that we need investment from every source in brazil. That ik of investment talked about, especially in infrastructure, and also because we are changing that. A state centered economy to a real market economy, so we need more private investment from inside or from abroad. We cannot rely on Public Investment anymore to build our infrastructure. We need investment from everywhere. What we need is more investment from other sources as well. Not to have any problem with the Chinese Investment itself. Shery the brazilian foreign minister. We will hear from him in the next hour when he discusses how he is approaching business with huawei. Up next, only 10 of you and Member States have a female head of state. My interview with the first female president of estonia, coming up. This is bloomberg. Paul this is daybreak asia. I am paul in sydney. Shery i am shery ahn in new york. The first female president in estonias history says young women need to learn from the past and that the workplace should be celebrating women as they are. I sat down with the president earlier and asked why the political empowerment of women has so difficult. If you look at the free and democratic world, which i really admire from afar while our country was occupied by the soviet union, then for the first women,ion, emancipating the opportunity with mostly if they went to the workplace, they basically had to leave their community behind. No children, working hours exactly like men, so it was accepted for women at the huge expense of family life. Not having it at all or delegating, taking care of the children. New generations of women do not have to go through this because we have more to learn from this. European countries have been suffering from low birth rates, and i think these two things are deeply linked. People in our country, in occupied countries, we had to work as women, so we are used to that. On the other hand, the whole burden also fell on women, and this was a tradition, and this was the report. This was also not the situation with which we could be happy. Now, we need to learn from this. I mean, historical perspective, and make sure that young women, and they are in the workforce, we do not tell them that if you have a baby, you are left behind. Your classmates are getting their first highlevel posts, but you are nursing that baby. We must find a way that the work celebrates also women as they are. Can honestly tell what it meant for our generation to get to the top and what kind of stigmas there were and get rid of them. Shery how much can the government and private sector do in practical measures to make that happen . Pres. Kaljulaid it sounds like not a practical measure, but in fact it is not so. I have heard women telling us, when i and other president s, for example here in the u. N. , speak about our experiences of being stigmatized because you do not have children or because you have children and you are a highly aspiring woman, how you are treated as a woman if you are relatively young, they tell they feel relieved because sometimes, women, younger women having got to this important post, when they exit areairplane, and they asking where is the boss, they feel like it is something wrong with me. I must not be good enough. If they hear from us that this can happen at the right level and has happened for those as well, it helps to empower them to speak up and not be silent in the situation. And also, if you think of a simple value of all children see i think it has a huge impact. At least for five years. President , and drawdrawdraw when they the president , they draw a woman. Difficult debut has prompted a lastminute change at the Hollywood Talent Agency endeavor. They pulled the ipo hours before the stock was to begin trading and sources close to the plan say a share shery huawei will license its technology to just one other company and it would like that company to be american. The founder reiterated his promise to offer huaweis full range of 5g tech to a single rival. They said that should be a u. S. Company. Southeast asias Largest Online travel startup is joining the movement of the financial services. It is backed by expedia and jd. Com and will issue a credit card with a bank linked to its booking service. It was founded in 2012. Shery shery markets open in tokyo, sydney, and seoul at the top of the hour. Lets turn to sophie for what to watch and markets. Sophie futures are trading mixed. The stock is very much in focus disappointing forecasts. The yen on a weekly decline. We are seeing this morning the threemonth young cross currency basis swap tumbling by 20 basis points. The worst g10 currency. On the other hand, it has been a good contender for the topix, as foreign buyers are returning to the fray, bringing the topix on track to be the s p 500 for the first time in years. The winning streak is not guaranteed to last. Shinzo abe pushing ahead for the sales tax height next tuesday. This is bloomberg. Devices are like doorways that could allow hackers into your home. And like all doors, theyre safer when locked. Thats why you need xfinity xfi. With the xfi gateway, devices connected to your homes wifi are protected. Which helps keep people outside from accessing your passwords, credit cards and cameras. And people inside from accidentally visiting sites that arent secure. And if someone trys well let you know. Xfi advanced security. If its connected, its protected. Call, click, or visit a store today. Paul good morning. Im all allen in sydney. Asian major markets are about to open. Shery good evening from new york. Im shery ahn. Sophie im Sophie Kamaruddin in hong kong. Welcome to daybreak asia. Paul our top stories this friday. It is another witchhunt. Here we go again. It is a terrible thing for our country. Paul President Trump decries the ukraine whistleblower, saying the call was wonderful. But the white house was already trying to keep the call under wraps. The russell is declining to add china to its flagship bond index. Shery carrie lam says the Hong Kong Government will find a way out of damaging unrest. Lets check Market Action with sophie in hong kong. Sophie. Sophie we are seeing a down day potentially for japanese stocks. Both in the nikkei and topix konta under pressure by half a percent. Toyota leads the charge when it comes to asking for Government Support for the automobile industry, even with tariffs on the sector on hold with the initial trade agreement between the u. S. And japan. We are watching jgb, seeing the 10 year yield lower shift, 25 negative basis points so far this morning while the yen is slightly under pressure this morning. Lets check in on the mood in seoul. Chipmakers are on the watch after microns downbeat outlook, investors heading out the gate dropping about 3. 5 , satchel electronics also lower about 2. 5 and the cost be off for tenths of 1 while the korean you want lets check in on the south pacific. We have the as asked 200 this morning, nudging higher by 1 10 of 1 while the aussie is steady, qe stocks gaping the kiwi stocks gaining ground but dollar has seen the euro and the pound a lag in that space. Paul. Word lets check first news with jessica summers. Jessica thanks come up oil paul. Oil tanker cost surge as the u. S. Accuses China Shipping oil from iran. 2ssels capable of carrying Million Barrels of cargo crude to asia jumped 19 while shares of tanker operators also rose. The list of sanctioned Chinese Companies includes a unit of cosco shipping, which operates the worlds secondlargest tanker fleet. The u. S. Disregards other parties and wheels sanctions at will, trampling basic warrants governing International Relations and goes against of trend. Jessica a second Hong Kong Developers as it will offer land for Affordable Homes if the government invokes legislation. The South China Morning Post says Henderson Land will provide one million square feet in the New Territories if the lands resumption ordinance comes into force. Earlier this week new world element that it would that said it would donate 3 million square feet of land if required. Singapore factory output plunged in august to the most in four years. A manufacturing downturn worsened. Industrial production dropped 8 from a year earlier, weakest since december 20 14 and worst in all forecasts in a bloomberg survey. Electronics was the biggest culprit, plunging 24 last month from one year ago. That is the worst reading for the sector since the start of 2012. Global news, 24 hours a day on air, on tictoc and twitter, powered by more than 2700 journalists and analysts in over 120 countries. Summers. Ca this is bloomberg. A first look at the whistleblower complaint a first look at the whistleblower complaint calls out President Trump for his controversial phone call with the president of ukraine. It documents surprise and alarm. I schneider joins us in hong kong. We have heard House Speaker nancy pelosi call the white house actions a coverup. From thet we know whistleblower complaint is what happened afterward, alleged from the whistleblower that multiple white house officials and multiple Government Officials were surprised and alarmed by that call. They didnt know it was coming. They didnt know the president was going to do that. And they were worried about what his asking a Government Official of another country, ukraine in this case, to investigate a political rival, could mean. They made efforts to lock down that call. They did not Tell Congress about it. They went to white house lawyers to find out what they should do. Shery what does it mean for the impeachment inquiry . looks like House Democrats are going to double down in their efforts on this inquiry. Nancy pelosi said it could have been a coverup. The coverup is often worse than the crime. This is what brought down Richard Nixon and watergate. Nixon in watergate. So this is going to be part of their inquiry, looking at what happened after the call was made. Actingtestimony from the intelligence director on capitol hill before the house intelligence committee, at which he himself said it was an unprecedented situation, that call, and that whistleblower report. End of course now President Trump is going to make it about the whistleblower report. He is casting aspersions on that and also saying, this was a witchhunt against him. Be there are going to significant investigations on capitol hill now, not only about that call but about what happened after that call, what steps did Government Officials take, and were they trying to cover it up . Paul how are republicans reacting to this . Are they continuing to circle the wagons around President Trump . Them are. , some of but some are being quiet. A lot of them are saying, when asked about impeachment and asked about the report, they say they cant comment about the report. In some are saying they would have to be jurors if the impeachment came to the senate, which is true, they would act as a jury, so they cant say anything. But at this point, of course it is a tough situation for many republicans, particularly those in the senate to have to run this year. Obviously, those in the house who are running in 2020 as well, so the question is, how long will they continue to stand by the president . Some have come out against him already. Senator mitt romney said he was very troubled by that phone call. But we will have to see what happens now. Of course, it would be very, very, highly, highly unlikely that the senate, the Republicanled Senate would impeach, would vote to impeach a republican president. Has happened here with this whistleblower report and these allegations of a potential coverup have moved this into another era. Paul Senior International schneider, thanks. Lets check the markets and get over to sophie in hong kong. Sophie i want to highlight japan display, the most schneid. Since june, tokyo offer earlier by as much as 12 , this after a withdrawal from the china bailout plan. This means it may be more difficult to continue with the business. Checking in on a currency mover, it is under pressure, weakening to the lowest level since september 24. This is the ftse russell puts relation bonds on its watchlist. How to hasl ahead, transformed chinas economy, as the peoples republic turns 70. We speak to china expert Rebecca Fannin. This is bloomberg. Shery this is daybreak asia. Im shery ahn in new york. Paul i am paul allen in sydney. Lets check business headlines. With a tough start, the third worst unicorn boost since 2008, falling as much as 14 after raising 1 billion in this ipo. Investors are already rattled by the sudden disintegration of wework going public. Debut pelotons physical sparks a lastminute change in a hollywood endeavor. It planned an ipo hours before the stock was to begin trading on the share sale according tos according to sources wont happen before next year at the earliest. The size of the offer was already reduced before ultimately deciding to pull the plug. Says it will license its technology to just one other company and would like that company to be american. They reiterated the promise to ofer huaweis full range tech to a single rival. They say that should be a u. S. Company, erickson doesnt need any help. Hong kong chief executive carrie lam is trying to find a way out of the sometimes violent protests that have continued into a fourth month. Our correspondent stephen thee has been covering unrest since the beginning. Stephen stephen dialogue and meeting with the public isnt one of the five demands of the protesters, but they have been questioning where is carrie lam . Why is she not addressing our main concerns . Why she do missing the other four demands . She acquiesced to the number one demand, officially withdraw the extradition bill. But the other four demands, she has not. A main point of contention at this town hall meeting last night, many who asked questions, there were 150 there were 150 in the audience. 30 people asked questions, 26 of those questions were direct questions about carrie lam not meeting the five demands of the bulk of those were about this proposed commission of inquiry, which protesters want the government to call, to have an independent investigation into alleged police tell the two. She again rejected that, saying there is an existing police Complaints Council that is still working through those complaints. She urged people in the audience, let the committee of complaints at least work through before we have a consideration for an inquiry. Thea Hong Kong Deputy to National Peoples congress in beijing told me a couple of weeks ago he has been urging not only beijing but also the government of carrie lam to acquiesce on one more of those demands, and that is set up a commission of inquiry. Help he said, would placate the more radical elements in this protest movement. Lam willy indication give into the other demands . no. En she has been steadfast in three other demands that stem from the summer of discontent, if you want to call it that. That is amnesty for arrested protested so far. More than 1000 have been protested. They also want some of those clashes with police to be declassified not as riots, because those carry more stiff jail sentences for those convicted. And there is also that committee of inquiry. Not acquiescing on that. Martin lee is the founder of the hong kong democratic party. He has been a staunch critic of beijing on their promises laid out in the basic law. He has been a staunch critic of the government of carrie lam and successive governments as well. However, he told me in my exhaustive reporting for this special coming up today, hong kong on edge, he said too much criticism is being targeted at carrie lam. Here is what he had to say. Spirit ofy, the democracy is here. We still enjoy some of the fruits of democracy, even though we dont have the tree anymore. The treat was in england. And dont put too much blame on the chief executive. Be fair to her. It is the system which is flawed. Sephen it is ansome say almost impossible business model, managing one country, two systems. Shery you can watch hong kong on edge at 2 00 p. M. Sydney time, midday in hong kong and it 00 p. M. In new york. Thewe have an alert on bloomberg. The Financial Times reports wework is halting all new lease agreements with Property Owners as the groups tires as the group tries to rein in costs. The move is expected to rattle commercial Property Owners around the world. The Financial Times was bracing for the property that bracing for the possibility that wework could suspend its expansion. Delayed their ipo, their very troubled ipo. The Financial Times was called says they are holding all new lease agreements to stem losses. Plenty more to come. This is bloomberg. Shery this is daybreak asia. Im shery ahn in new york. Paul im paul allen in sydney. Issuedt guest as asian dominance is hit a record, almost 80 billion issued, the majority from china. Joining us from hong kong is triada capital founder monica hsiao monica hsiao. A record issuance, is it a great surprise . Monica , last year no. Last year we raised a total of about 180 billion dollars, a very volatile year that we came off of in asia credit last year. This year it made sense with the amount of redemptions that were coming due, so we have raised year to date in total gross issuance of 235 billion dollars and we expect by year to reach around 300 billion dollars. As you mentioned, of that we had a record yield for high record year for highyield issuance of 80 billion, most of it from china. Proportions now as a of our total, high yield market and asia, 65 is coming from china. Seeing the are you best value in asia credit right now . Monica it is interesting because we had a repricing in andlast couple of months, that has meant, with concerns on growth, we have had much credit much greater credit for education, more dispersion, and as a result we see the sweet spot being definitely in china high yield. And within high yield, the spread between single b and double b has widened so much that we think the single b area is most interesting and within that china property is the area we prefer for riskreward. We see that in the curve, the amount you are getting paid for a oneyear extension, for example, from oneyear maturity to twoyear maturity. You are getting paid as much as 160 to 180 bits for a oneyear extension. So we think that area is really interesting on the valuation side. Fundamentally, china property is also one where we think you are getting paid sufficiently for the risk, and especially as we have seen a lot of the chinese property issuers improve quite a lot. There projected sales have increased by 25 . They are engaging in much more prudent liability management, given the curbs and the tightening of the financial channels for them to buy land. So they are reducing land acquisition, which means their leverage is actually trending down. So at as a result, this is why we think the sweet spot really is in china high yield aroundies, single b and a twoyear maturity. Shery how much as the trade war had an impact on the fundamentals of some bond issuers . Credit for the asia index, only about 1 of the constituents have a direct impact from the trade war, in theory, on their business. Obviously, the trade war has an impact on risk sentiment. That is the main impact, the risk on, risk off view of risk assets. That has an impact on the technicals. But overall, when you look at china high yield market, the vast majority of the bonds is really in china property. And the chinese property developers, their fundamentals are not directly impacted. Think it flows through more from a macro sentiment. Shery what about the strong dollar . The dollar index is the highest level since 2017. How does this affect em markets . Ica hsiao monica the strong dollar always has an impact on the strong gm effects market. The strong em effects market. However, we have strong deceleration and policies seem to be toward keeping that relativelys table. Relatively stable. The main concern for us would be if the cmh decelerates at a faster pace and becomes highly volatile. That definitely can have an sentiment of our offshore assets as well. But at the moment, we do expect the cnh to be relatively stable going into trade talks. And we also think it is in chinas interests to internationalize the running as they look towards index inclusion as well. We are not concerned at the moment that it will be out of the bounds of the range. Paul i just want to get to one of your contrary and calls before we let you go. You prefer high yield to Investment Grade . Why is that . most of the street recommends going toward Higher Quality with the concerns on growth. We are actually preferring high yields, not only because of the valuation, but we really think that fundamentally there are a lot of pickings right now. There is overpricing of fear. Steepnessbeen a sharp of the curve between one to three year, and our chinese highyield Property Market that we mentioned previously. I do think that Investment Grade, if you compare it to the u. S. Equivalent, there is virtually no premium at the moment, whereas for high yield, we are paid, for single b right now we are being paid 3 over the u. S. Equivalent of single b, when in fact the average of the index in the u. S. Has one and a half to two years of maturity. So it is very interesting from valuation and as i mentioned earlier, on fundamentals. We are not doing badly in fundamentals. Triadamonica hsiao, capital founder and ceo, thank you. Ftse russell is taking a pass on chinese bonds and wont add it to its flagship world Government Bond index. It could dent chinese efforts to bring more foreign Capital Investors into its markets. Lets find out what it means from our chinese reporter. Is the ftse, why russell not moving this time around . Ftse didnt actually give a reason for why they are keeping china on the watchlist. They simply said they are going to do so and that they will review again in march. Some reasons could be, according to active Fund Managers we talked to, that there are some problems in accessing the china by market. Active Fund Managers including moodys cited problems like liquidity and capital controls and a lack of hedging tools that prevent them from really entering the market. Paul so is this just a pause . Are they likely to be added to the index down the track . they definitely could be added down the track, but it just depends on when it will happen. We saw jp morgan as well as a Bloomberg Barclays already decide on a phased inclusion of chinese bonds into the indexes. This time around we had been inspecting at the market had been expecting an inclusion from follows inse that the same trend is giving a stamp of approval to chinese to china punch of as bond market opening up. And given that china has slowly opened its bond market, it is likely the inclusion would come later. Paul are there any broader implications to this decision . Livia well, its a disappointment to eu Market Sentiment for sure. The market had been expecting more inclusion, which means billion an influence could have come in, according to goldman business estimates. But it doesnt mean doom and gloom for the chinese bond market. Strategists say the chinese bond yield is likely to make another pastor falling below 4 for the third quarter, so not bad for the chinese bond market. Paul our chinese rates reporter, thanks for joining us. Plenty to come on daybreak asia. s ipo. Te on peloton this is bloomberg. Jessica this is daybreak asia. With firsta summers word headlines. Hong kongs embattled leader carrie lam says it is up to the government to find a solution for months of unrest. She told a dialogue event she accepts responsibility for the true moral in both sides are hurt and angry. Her skeptical audience asked why she would not key would not agree to key demands from protesters. They also called for her to resign. Airbus has taken steps to improve defenses against cyberattacks. Say enginem france maker rollsroyce is at least is among at least four airbus suppliers target in the last year target in the last targeted in the last year, possibly by china. Rival boeing was hit last year. A new report from the worlds Nuclear Watchdog says iran has boosted its atomic capacity further, installing powerful centrifuges in contravention of the deal with global powers. The International AtomicEnergy Agency report has been seen by bloomberg. It says iran is preparing additional measures to reconstitute its stockpile of enriched uranium. And Saudia Arabia is changing one of its fundamental rules. It is dropping the dress code for foreign women. The dramatic move is part of the kingdoms attempt to boost tourism as it tries to diversify the economy away from fossil fuels. It has been mandatory attire for decades. The rule change means foreign women will be instructed to wear modest clothing. The dress is optional. This will be clearer online and in applications. I know saudi women would like to experience it and see it as part of the culture and will decide not to wear it. Jessica global news, 24 hours a day on air, on tictoc and twitter, powered by more than 2700 journalists and analysts in over 120 countries. Im jessica summers. This is bloomberg. Shery a mixed picture across markets in asia. Lets get the view from sophie. Sophie the regional benchmark it asia is set for a second straight weekly drop and its first quarterly decrying decline in three. The decline led by the nikkei and the cost be off. Is undern yuan pressure in the kiwi dollar is off by 2 10 of 1 after Customer Confidence for new zealand fell to a fouryear low in september. This morning the yen is nudging slightly higher but broadly steady and set for a weekly drop amid seasonal flows. Check out the malaysian currency, snapping a four day decline in back below 419 after ftse kept bonds on their watch list. Pressure remains on malaysian assets with the country still at risk for being removed from the ftse world Government Bond index. Stock movers over install, this is winning the most on the cost be after chipmaker micron offered a disappointing profit forecast and cut its capital spending. In tokyo,falling toyota and other lawmakers calling for Government Support. Japanese banks back in negative territory after a brief strike after a brief spike. Paul. Paul thanks, sophie. The bicycle fitness startup had a tough start, the fourth worst unicorn boost since 2008. Still, ceo john foley tells bloomberg he is upbeat. We are playing the long game. We see this as building millions and millions of subscribers around the globe in the coming years. Now we have the money to do that. We are fully funded after todays primary, so we are feeling confident. When you think about the last couple of days and couple of weeks, you mentioned the markets. Wework is on everybodys mind. It is a tricky ipo market to say the least. Do you have a sense of where the miscalculation was . This is my eighth fundraiser at peloton, and people either see a door they dont. So there is believers and there is nonbelievers. Leaved, that have that have believed and have invested in palo thanh in peloton for years now are very happy. You mentioned fully funded. What does expansion look like . We are building a 50 Million Television streaming studio here in new york, another studio in london, we will hire Foreign Language instructors. German language instructors are being hired to stream to a German Market which we open in, i think, 60 days. We are investing in new content, new verticals, we brought they tread market last year, we have canada, u. K. , germany, we are in investment mode. Someone today said, are you losing money . No, it is semantics. We are investing. We feel very good about what we are doing. How do you feel about the Consumer Market . You sell a highend product. What do you hear from your importantly,d more potential customers, about willingness to write a big check or charge Something Big on their credit card . John one of the things we think about is the optics on affordability. Its anhave a peloton, insane value visaviss anything else. Fitness has been a recessionproof category for the last 15 years. More dollars went into fitness in 2008 and 2009 as they did every year, so the secular growth over the last 15 years. We think we create the best value in fitness. If you write your bike on average our bikes are ridden 12 times to 14 times a month. If i debt by 39, you are paying a couple of dollars for a workout, orders of magnitude better than going to boutique fitness world. And we are going to show over time that it is an even better value than going to the gym. You have described the company has a technology company, media company, it obviously does a lot more. Where were you primarily be spending money, content push . Core,i would say at our we cant Hire Software engineers fast enough. We are a software company, tech company at our core. We had to learn our way into the media and now have 13 Emmy Awardwinning producers and now hired a fantastic chief content officer in jen connor. She is going to build a special Media Division in any category. But at our core, the investment is going into technology, Retail Stores, logistics, more markets and all this stuff to show how multifaceted peloton is. But certainly Software Engineering is at our core. Ton ceo speaking with bloombergs jason kelly. Lets bring in su keenan for more analysis. Another ipo flop. Su and this was to be the mother load of ipo launches, not just with peloton, a very disappointing launch, but also with wework, the ceo removed with an outside ceo, and they are starting to reconstruct that company to launch next year. And right after the closing bell we heard direct response to the ipo plunge. Or was set to launch this week, a hollywood Entertainment Company, yanking their ipo and saying they are going to evaluate timing. Lets talk about timing, because ipo was highly bonded, everyone on wall street excited about it, numbers looked good, fundraising round had gone very well, and yet in the count down to this launch, some analysts were saying valuation, the valuation does not match the numbers for a cashburning company. That is what weworks also has common with this. Its worth looking at the stock chart one more time. It was a big disappointment, priced at 29, opening lower, closed down 11 . Look, it is not even rendering here, so perhaps that is a sign of what many feel at the end of the day. [laughter] investors feel somewhat empty that this did not go as planned. Part of pelotons ipo disappointments, meant to be a banner leader for logic banner year for launches. What happened . There was one company that thought it would make a 1 billion profit as an early investor in peloton. Lets go into the bloomberg outlook and look at mega ipos that have performed in the week before the peloton launch. The size of the drop is spectacular and injurious to investors lets go through the numbers. Again, oneweek declines coming up today. Smile direct joins peloton and being one of the worst ipo launches since the financial crisis, far worse than peloton , down 29 in the past week and down 40 in its launch. Cyber security. E o datadog had a good launch but was down recently because of concerns per lets go to the next page. We know about lyft, we know about uber and in the past week these had very serious downturns. When we look at the concerns there are a lot of investors and a portly banks going back to the and importantly investment banks going back to the drawing board. Investment banks make their largest fees taking these unicorns to market and this is a big disappointment for those banks, likely to show up going forward. Shery su keenan, thank you. And a moment, the foreign minister of brazil explains why he wouldnt scream innate any company. I or my exclusive interview is next. This is bloomberg. Paul this is daybreak asia. Im paul allen in sydney. Shery im shery ahn in new york. While way under more pressure. A top official says washington will probably not renew a temporary waiver for american suppliers want to do business with the chinese tech giant. But huawei may find solace in other markets, such as brazil. It already has a presence selling premium phones. I spoke to form minister foreign minister Ernesto Araujo in an exclusive interview. He says brazil doesnt want to discriminate against any company. It is anaraujo important issue given how important 5g will be. We want to look at that carefully, not only at huawei, at any prospective providers for our system, to see what they can offer in terms of, across the board, not only quality but also security and all the features of their systems. So we have to look into that, not because this is huawei, but because of the goals we have, which is to have an effective, efficient system which is safe, which provides guarantees that is how we are looking at it. Shery but u. S. Officials have warned they could restrict intelligence sharing with these countries if they use huawei equipment. How do you respond . Minister araujo we have to keep our dialogue on that. Shery are you having dialogue right now . Minister araujo not precisely about this, we have very important intelligence relations and we want to keep that, of course. So we take everything into talk withut we also our friends in china. We want to hear from everyone. But the important thing is that we dont want to discriminate against any company. We just want to see what really are the challenges this technology can bring, and how to address them. Shery do you have a set strategy on what you will d what you will do next if this trade war continues, with huawei at the center of these tensions . Monica hsiao we hope minister araujo we hope this doesnt last a long time. We want the Global Economy to grow and create opportunities. We are exactly in the moment where brazil is getting there, with much more engagement in the world in terms of trade, investment, but we have to live in the world as it is. We have to see what opportunities are there, what opportunities emerge from the shifting situation. The u. S. Y understand side on this. We also try to understand the chinese side. We think all countries are trying to defend their interests. Shery do have a timeline . Huawei will want to get involved in your communications system. Probablyaraujo sometime next year we will open the process for the providers that will be in our system. That in a wayise that will be conducive to efficiency and the safety of the system. As of now in the previous generations in brazil we have a very good partner, so the timeline is still not precise, but sometime next year i think we will start to deal with that sort of thing. Paul that is brazilian foreign minister Ernesto Araujo. Lets get more on huawei. Ae u. S. Probably wont renew temporary waiver that lets American Companies do business with the telecommunications giant. The washington crackdown is a major risk to the Chinese Telecom industry, a pillar of its growth. Lets head to our china correspondent selina wang. Right, paul. Is we have top trade negotiators meeting next month. There is still doubt anything is going to be resolved in terms of the Technology Cold war. Our next guest is going to tell us more about that. Joining us from San Francisco is Rebecca Fannin, media entrepreneur and author of the new book, tech titans of china. Huawei is trying to convince customers that its gear is free of security loopholes. What this huawei say about the ability of Chinese Companies to gain global trust when it comes to privacy and security . Rebecca this is a big issue. If this is not renewed it is definitely going to escalate the u. S. China tech and trade war. Huawei is being pushed into a corner to develop its own technologies and become much more reliant on its own technologies, and less from the u. S. , which is has been which it has been for years. there is a long history of cooperation between the u. S. And chinese Tech Industries that is now at risk of decoupling. What is the risk . Is a phraseoupling that is definitely heard a lot reality it is another round. Se there has been a lot of collaboration and cooperation between the u. S. And china and developing innovation. So if the decoupling happens to a certain degree, i think it will slow Global Innovation and increased consumer and business prices. I dont see it as a positive trend at all. your latest book focuses on the next generation of tech giants, beyond alibaba. What challenges they face in the current geopolitical climate . Is a lot ofre distrust of Chinese Brands now in the u. S. Particularly, and these new Tech Companies are going to face a bigger challenge and going into the u. S. , for instance. There have been some success stories, such as tictoc, the 15 second video app that has become very popular in the u. S. But i think with electric vehicles, for instance, this area is being pushed very hard by china. Electric carmakers may have a tough time entering the u. S. Market. Paul you mentioned an environment of distrust. Where does the distrust come from . Minister araujo rebecca is as it has long been said that huawei is spying or there are security risks related to the company. While why is defending itself. There are investigations going on by the fbi over Cyber Security threats, many from china, and we will have to see how this plays out. There are continued Security Issues around huawei, at least from the u. S. Perspective. Reported has been well that the Chinese Government will assign officials to influential technology companies. In your reporting, what government involvement did you see in those companies . Well, it is rather hidden. I have heard instances of communist Party Members being in boardrooms, meetings every day. We have heard instances of influence by the communist party in some of these tech titans. The communist party feels somewhat threatened by the rise of these incredible tech titans from china, how much power they gained, how they have emerged over the past decade, not just Alibaba Tencent but a whole group of newcomers, the tmd, any number of them. This tech economy is an incredible force today in china, and we see china really asserting itself as a world leader in technology. Topdown many, many directives for china to become a Global Leader in technology. The made in china 2025 is one example. The 15 billion china tech fund is another example. Paul you talk about chinese tech giants being more diversified and more acquisitive than those in the u. S. Rebecca definitely more acquisitive. China has gone into Southeast Asia in a big way, for instance. And china was investing heavily in u. S. Technology, including some of the tech trophies such lyft. La, uber, but they have pulled back. There is an argument to be made that china tech has gone from copying to innovating today. You see new Business Models coming from china, social commerce, a new area china invented. Even the bike sharing that china originated, this idea went global. It was started in china. Paul thank you, silicon dragon in san Rebecca Fannin francisco and my colleague selina wang. More to come on whatd you miss . Stay with us. This is bloomberg. Shery we have an alert on the bloomberg. We are getting more insight on the ftse russell decision not to add chinese bonds into their flagship world Government Bond index, and just keep china on their watch list. They say the funds are seeking Greater ChinaGreater China bond liquidity and investors want more execution flacks in china. The ftse russell does see significant progress for a future upgrade of china, this coming in an email statement from ftse. Lets get a preview of what to watch and markets later. Sophie we are watching Hong Kong Developers with henderson reportedly following another company to offer land for Public Housing if the government passes an ordinance, putting the onus governor carry la governor carrie lam. We will find out when she delivers her policy address. City landlords are on a watch slump year ony year, with transactions in 2019 ected to be lower than 20 at last month prod announced plans to still to close its Largest Store in hong kong in 2020. Paul thanks. Come, more conversations. We look ahead to the start of trade in hong kong. Bloomberg markets the china open, up next. Beyond the routine checkups. Beyond the notsoroutine cases. Comcast business is helping doctors provide care in whole new ways. All working with a new generation of technologies powered by our gigspeed network. Because beyond technology. There is human ingenuity. Every day, comcast business is helping businesses go beyond the expected. To do the extraordinary. Take your business beyond. It is 9 00 a. M. In beijing and singapore welcome to Bloomberg Markets china open. Im tom mackenzie. David we are counting down to the open of trading in hong kong and the chinese mainland. Lets get to the top stories this friday. President trump it is another witchhunt. It is a terrible thing for our country. Decries thent trump ukraine whistleblower, citing his call was wonderful, but the white house is already trying to keep the record under wraps. Tom this hour brings the latest check on the chinese economy. Industrial profits may have