Transcripts For CNBC Squawk Alley 20171110

That company, Michael Evans, thats one you dont want to miss in the meantime, lets get to eunice yuan in shanghai. Well get to her in a moment eunice, good evening, good morning to you hey, guys well, its just past midnight here in china, meaning that singles day has kicked off and hundreds of millions of chinese across the country are going to be shopping until they drop. Maybe not necessarily until they drop, because they are probably at their houses online in their pajamas. Were seeing over the next 24 hours theres going to be a lot of shopping. People are talking about it on social media its a top trending topic. They are buying everything from smartphones, tvs, dog food one company said they are going to be offering a lifetime supply of chinese liquor for 11,111, thats about 1,700. This year there are more International Brands that are taking part than ever before 60,000 of them 7,000 american ones. And that includes nike, lululemon, macys, the gap, and estee lauder as you know, its not only about the sales this year. Alibaba has been using this day to try to push newer initiatives that they believe are going to shake up and transform the Retail Industry here they are calling it new retail, and the idea behind it is that alibaba is going to use a lot of its technology and know how, its Online Platforms and users and leverage it into physical Department Stores and mall operators. Now, one of the examples they keep using is the investment theyve made into a supermarket chain, and this company is kind of like a hightech chinese version of whole foods so the idea behind it is that a consumer can go into the supermarket and they are using their mobile phone, ordering their food online, they are having that delivered to their house in the next 30 minutes or if they could go to the Self Checkout area and check it out once they do and get to the end of the process, theres a system that has facial recognition and it scans their face so they could pay using alibabas payment platform called ali pay. It all sounds very futuristic and privacy advocates will say a little scary, but it is something that is happening right now in china now, let me just take a look where we are with the numbers, 1. 5 billion, but Analysts Expect this to break more records and get to 23, 24 billion dollars. Guys eunice, talk to you soon. In the meantime, hans tongue, managing partner with one of the earliest venture backers with alibaba good to talk to you, happy friday happy singles day. Likewise with you guys. As with a lot of things related to china, its sometimes hard for u. S. Viewers to understand and grasp the scale of the holiday and to some degree the history of this hi d holiday, how it became so big. How do you explain it . In china, there are two times a year that were theres a ton of dating going on one is during the valentines day on february 14th, the other one is in the Chinese Lunar calendar year of july the 7th. And so seagulls have a tough time finding the other half and there are a lot more men than women in china today the deficit is roughly around 30 million as such. And, therefore, having to create a singles day to allow you to shop for yourself, to make yourself happy is ingenious marketing idea that alibaba came up with. And in 2013, sales for the first singles day is roughly about 5. 7 billion u. S. , and last year was 17. 8 billion. Theyve been able to grow 50 year on year and this year should be around 23 billion or so so the massive scale they have created from an interesting idea to tap into the psyche of chinese consumers is an ingenious move by alibaba. Hans, what do you make of this wall street journal story that makes the argument singles day is losing momentum, losing some of its cache, deliveries arent fast enough and needs somewhat of a pivot. Do you think theres anything to that i think this year it will probably be expected to deliver a billion packages, and that needs to be done over the next few weeks or so. Thats a lot of work over 120 transactions happen per second, and that number gets broken every year. So i dont think that its losing steam its just that the growth is difficult to manage, and alibaba is figuring out how to do that well, and by doing that they are building a world class a. I. Team and also an Impressive Technology and call center to be able to keep up with the volume of demand. So, i think that its not only alibaba doing it, we see jd. Com, their number one competitor in china also doing the singles day promotion. Our company in San Francisco wishes there was something special, as well more and more companies will want to partake in this day and not just be just alibaba theyve also built a stock price that is surged this year in the last 12 months up 97 , just had another quarterly revenue of 61 growth, hans. How do you think jack ma and the company is envisioning the future clearly, the growth right now is in ecommerce, but as eunice has been reporting all morning, they are really testing out bringing Convenience Stores and malls and brick and mortar into the model and sort of marrying the two in some kind of vision for how retail is going to look. Throughout 2015 and also 2016, alibaba stock price was kind of depressed because of investor in the u. S. Worry over chinese economy and its growth outlook. I think what has happened in the last 12 months, people see that despite a slowdown in growth in the world, new china and new economy china driven by alibaba and other Internet Companies in china are growing at a rapid rate you look at ecommerce parenation in china, roughly 10 of total retail in china and that number has gone from zero in 2003, when they were first investing in alibaba to 15 today. We think over the next ten years that number could potentially double, and as such, how to grow alibaba, figure out how to do more stuff offline we heard about puma earlier in the segment, and that is very interesting for chinese consumers, because you go inside, you open up your smartphone, open up ali pay, scan the code, not every product in the restaurant, in the supermarket, you can see the details, every product youre looking at and compare prices with other offerings that are on the sites. So you can do very quickly make intelligent Decision Making whether you want to buy the product or not once you buy, you have a choice to either consume it in the store in a nice setting or you can take it home, or you can have alibaba deliver for you through signing up so the way they are offering is extremely integrated, at the same time you have the freedom to choose how you want to consume it and shop. That kind of freedom leaves you online and offline with a lot more choices is the Retail Experience jack is talking about at the beginning of the year were going to find out whether or not this is something that can truly go global and whether the schematic of singles day translates around the world. Hans, always good to get your take thanks for the time. Good to be here twitter Ceo Jack Dorsey spoke at the New York Times dealbook conference yesterday, addressing the twitter staffer deactivating the president s twitter account. Take a listen. The account was not removed, it was not suspended, it was deactivated, which is a very different state than what you would assume so it was not deleted, it was put in a state waiting for the owner to come back to it and reactivate it. Did the owner yes otherwise, the president . Yes he came back to it . He came back to it. And he reactivated it. Did they call you we have conversations we have conversations, yeah. Andrew also took the opportunity to ask dorsey if he was invited to testify in front of congress about russias use of twitter to interfere in the election heres what he said about that if i was called specifically, i would go and i would get prepared and make sure that i understand every single aspect of what happened and what were doing about it, more importantly fascinating interview with dorsey said he would have gone, had he been called specifically, and then overall said he wouldnt give us high grades right now in terms of translating transparency to users. Yeah. Hes got a busy couple of jobs leading square, which is up more than 200 over the last 12 months, also leading twitter easy to see why he would send somebody else, if he could, but the optics on that, not fantastic. I also think the scandal that broke this week was a big deal, the Company Giving an authentication blue checkmark to jason kesler, who organized the august white supremacist hate rally in charlottesville then instituting the hiatus on all verifications correct then jack admitting the system is broken and needs to be reconsidered shows how much of an uphill battle they are going to have when it comes to fighting hate speech and overall sort of getting a Bad Reputation for promoting this kind of behavior. Communication has been convoluted, especially regarding deleted accounts and verification the New York Stock Exchange here is honoring veterans day today we had a moment of silence and unveiling of some plaques early in the morning now at 11 11 a. M. , the exchange is unfurling the American Flag on its facade on broad street, and we will hear taps. [ taps playing ] [ taps playing ] that happened at 11 11, because as we reminded viewers earlier this morning, hostilities ended in world war i on the 11th hour of the 11th day of 1918. If you see a veteran today, thank them for their service when we come back, alibabas singles day. Full coverage of the Worlds Largest Online Shopping event. The president of a. Libaba will join us. Plus, more on the companys legal troubles across the pond and disneys streaming strategy. The detail of the plans to take on netflix when squawk alley returns. Alerts wouldnt you like one from the market when it might be time to buy or sell . With fidelitys realtime analytics, youll get clear, actionable alerts about potential Investment Opportunities in real time. Fidelity. Open an account today. Fidelity. The market. Redict but through good times and bad. At t. Rowe price. Weve helped our investors stay confident for over 75 years. Call us or your advisor. T. Rowe price. Invest with confidence. Is. Stocks are in the red following yesterdays big selloff. The focus today on earnings, data, and tax return joining us, Global Market strategist at jpmorgan analyst and jason ware welcome to you both. Lets start with tech. Squawk alley, market leaders are they more vulnerable if we get broader pullback in the market because they performed so well, whether its on taxes or data or earnings what i think is interesting is that tech seems to rally regardless what kind of day the market is having when the more defensive sectors do well, you oftentimes see tech participate and when the more cyclical parts do well, youre seeing tech do fairly well, too. We think the fundamentals are really underpinning the performance that were seeing here if you look at the percentage of earnings that tech has contributed to the s p 500 profit season, its pretty much in line with its market cap, so were not terribly concerned tech has overextended. Stick with it stick with it earnings are good and were big fundamental guys, particularly in a late cycle bull market. Jason, do you agree yeah, david laid out a good case you dont have to look any further than Third Quarter earnings to see the blowout results and accelerating Business Performance as some of these bellwether technology companies. Analysts have to continue to chase these stocks higher both in buying these stocks, being underweight and moving numbers up higher to reflect the strong operating fundamentals david, we talk about tech writ large, but there are lots of different types of companies under that umbrella. You have your teslas and nvidias that have run up with huge valuations and apple, as well. Not saying that a down turn is coming, but if it is to come, do you have some thoughts on what types of tech stocks will be affected more or differently than others . So i think more the hardware providers will be affected more. Think about any sort of pullback in the market or pullback in the economy, one of the first things to get hit is going to be business spending. Business spending on equipment tends to go before business spending on things Like Software and other services, so the Service Providers and Software Companies will be more insulated against any pullback yeah, you look at a chart of ibm, which has given up more than half of the gains out of earnings season. Exactly, exactly. What youre seeing there, given the length of time that this rally in tech has gone on, youre seeing investors differentiate a little bit more between the individual names its no longer about tapping the sector for the earnings and Revenue Growth its more about the underlying fundamentals isnt that, especially the fang trade, crowded right now . Isnt that among the top trades right now if you look at bank of america, Merrill Lynch and others that have shown teachers contracts . Any positioning that have shown these trades get really crowded . It is a bit crowded we see other opportunities in the market that we think perhaps have more returnpotential. Were overweight energy, we like energy stocks. We think the micro is catching up with the macro and given our view of rising rates next year, we think that financials could do well over the coming 12 months so sticking with tech, again, i remember when we were talking about teflon tech, its tough to make it go down, we think the fundamentals remain supportive, but there are other opportunities for investors to tap in the current market. Jason, its singles day today, but soon enough, arguably too soon, Christmas Lights will be going up and the wreaths and what not are there particular names, maybe in tech to start that youre looking at to have perhaps big upside potential if q4 turns out better for them than it has in the past . Well, i think there are, obviously, goto names like apple is going to have a big Holiday Season and thats a stock weve been bullish on for some time. Its kind of a nobrainer spot to be in as far as the Holiday Season is concerned, but there are other areas in technology that we like looking further out beyond just q4, you know, spots in semiconductors, industrial lasers, a Company Called coherent thats leading the market there thats a great play on the technology of oled screens and micro electronics and semiconductors and, of course, Companies Like google and Software Companies and Cloud Companies that are doing things in a more secular basis than whats going to happen in q4, but to your point theres certainly those companies in there that are going to benefit from a strong q4, but were looking further beyond than just that other big theme, of course, tax reform got a lot of news on that front this week. I want to ask you, now that we have the duelling plans from the house and the senate, did the odds for tax reform and specifically corporate cuts go up or down, and how do you recommend investors play that . So i think that actually the chances of tax reform are relatively unchanged i think essentially what has happened is youve seen the house and the senate both put a stake in the ground. They are saying this is our starting point whats key is that both the house and the senate get something on paper that everybody tends to agree with, and then they go and debate exactly what the final bill will look like. Were still expecting some sort of tax reform, maybe First Quarter of next year, im not quite sure it will get done before the end of this year, but we are looking for a cut to be a tail wind for profits in 2018 and beyond its actually up right now, russell 2,000. In a down market exactly, and Small Companies would obviously benefit from that more than large ones. Thank you very much David Leibovitz and jason ware thank you when we come back, the streaming wars heating up. Disneys ceo bob eiger announcing plans to announce a streaming service costing much less than netflix. And as we head to break, taking a look at shares of news corp. , a top performer today after posting and earnings beat last night. Squawk alley will be right back [vo] progress is an unstoppable force. The season of audi sales event is here. Audi will cover your first months lease payment on select models during the season of audi sales event. Its a down market overall, but wanted to point out the rally going on with media stocks its been going on all week, but some particular strength in names like news corp. , viacom, walt disney. Better interpretation of their earnings there perhaps subscriber losses werent as bad as feared overall deal speculation earlier in the week disney was talking to 21st century fox about buying a big part of its business the whole group is up. Coming up, uber just lost another legal battle in the uk one of the ridesharing apps early investors will be joining us next. European markets closing in about two minutes. Lets get to dom chu at headquarters with the close. Dom . Seeing some proportional losses across the continent. Take a look at biggest losers, syringeal individually speaking, leonardo cut its revenue and its Profit Guidance for the year, citing a challenging environment in its helicopter business. Weve also got British Fashion brand burberry slipping yet again, a string of brokers out there, including deutsche bank, jpmorgan all cut their target price after the company warned sales would stagnate over the next couple of years uber suffering another setback in the uk employment tribunal. A judge ruled its drivers should be classified as formal workers and not self employed. Uber says its planning to appeal that ruling and, of course, another round of brexit talks between the e. U. And uk concluding, leaving several key issues to fix. Back over to you guys. All right, dom, thank you very much for that lets get a news update with Contessa Brewer at hq. Good morning nice to see you, afghan Officials Say a suicide car bombing in the Southern Province killed a policeman and injured two more no group immediately claimed responsibility, but the province is in the heartland of the taliban. A transmission line failure has left thousands in puerto rico without power again. Just after some areas finally were seeing restoration of electricity here, this failure took place in the same transmission line that previously was repaired by white fish energy, thats the company that had its 300 Million Contract to restore power cancelled. First Lady Melania Trump toured the great wall of china, strolling along a stretch north of beijing for about half an hour with a small group of aides and security officers, staying in china before returning home as President Trump flew on to vietnam. Louis cks film i love you daddy will not be released. That film was set for release november 17th. Thats our cnbc news update this hour lets get back to squawk alley. John all right, thank you, contessa as dom chu just mentioned, big news and not the positive kind for uber out of london uber suffering a blow to its operations drivers there not going to be classified as self employed contractors. They are going to be classified more like employees, meaning uber has got to be making sure they are making minimum wage and they get time off among other things jason, early uber investor, joins us now great to be here. Jason, its looking tough for the new ceo, one of the first things that he said he was going to do is go over to london and make nice. Yeah, yeah. Hows it going . Well, you know, the apology tour continues and its going to take time. This issue is very specifically around the independent contractor designation, and many of the uber drivers want to change the number of hours they work they want to work ten hours one week, 40 another, and every location theres a different set of rules in london and the uk theres a totally different set of rules than in the u. S. And its just a financial equation in my mind. If a location wants to classify these as fulltime employees and reduce their ability to have flexibility, its going to increase costs for the consumers and its just the nature of different markets, different regulations, and i feel here in the United States we need a third classification, not an independent contractor, not a fulltime employee, but somebody part of the gig economy and that they get some sort of credit towards health care and some number of days off, while still being able to change from 20 hours a week to 60 hours a week as they feel i think that we just need to learn how to handle this new gig economy and its going to take some time. I talked about a lot during the election, during the primary season especially, jeb bush went to Silicon Valley and Hillary Clinton talked about it. Hit me up on twitter. We havent heard a lot about it in the past year. Heres the truth, in a competitive, you know, market today for talent, the market is actually driving wages up. We see that and we see a lot of locations putting a 15 minimum wage, so the drivers are going to move from amazon to lyft to uber or whoever gives them the best deal. There is a massive competition and a lot of the startups i invested in three or four years ago died in the on demand space because they couldnt keep up with what uber, lyft, and amazon were willing to pay. I think the Market Forces are at work and were seeing the net hourly rate go up and the truth is people want these type of jobs millennials and older people or the second income in the household, they want that flexibility, they want to be able to drop their kids off at work and come back off of it so the market will decide ultimately, and regulations need to evolve on the margins, but netnet, look at america we have some of the, you know, greatest unemployment that weve lowered unemployment very significantly after that, you know, great recession. So i feel good about what uber and lyft have done for the economy. What about dara interesting to hear from him yesterday. I knew you would react that way. On track he says for 2019 ipo. He says travis and the whole board is into that idea and that he has a Good Relationship with travis kalanick. Did that surprise you . Travis has evolved, i think, and learned a lot. Hes done a tremendous job getting the company to where it is and now you have dara coming in, who has this other skill set and is really fixing things up and getting us on a clear path towards an ipo and theres this other optionality, the masa ipo. Everybody is talking about why ipo when you can massa, you know, massa is going to save all these companies and put the money in and were good. Yeah. So i feel great about it. Question of who hes going to hit with that wand, though is it going to be uber, lyft, he doesnt hit everybody. Got to move on and talk disney reporting results yesterday missing estimates on earnings and revenue, but still stocks higher after ceo bob eiger announced plans to take on netflix. Take a listen. Weve given a lot of thought to pricing both espn and the disney brand of service, and i cant get specific with you yet. We havent actually officially determined it, but we said we will be forthcoming with you on this some time after the first of the year. I can say that our plan on the disney side is to price this substantially below where netflix is sounds like a boutique streaming service, not the grand unified vision, jason, that you suggested. Whats your take on disneys at least initial foray into streaming . I think disney is going to become a juggernaut, this may take ten years to play out, but if you look at what disney does incredibly well, they know how to sell direct to consumers in the parks, weve been there and spent hundreds of dollars a day in that park they have a discipline of selling into, you know, the distributors when it comes to content, but they have this massive content. When they dial it and go direct to consumer, when they start selling direct to consumers, they are going to be able to take this 27 movies i think theyve done for marvel and do the star wars live action. Right now my 8 year old is getting into marvel and were watching every marvel movie. If i could pay 7 a month to disney and not have my 8 year old saying put on hulk, avengers, get it in one place, fantastic. You look at youtube and their horrible missteps on taking no ownership on the youtube kids, this is going to play amazingly into disneys hand espn is a unique challenge, because they cant charge 7 a month and make that work, so i think thats going to be a challenge, but i could see disney immediately getting to tens of millions of people on this service and consumers are going to flock to it pixar, star wars, and star wars is really cranking rogue one is the number three Star Wars Film of all time Empire Strikes back, star wars, rogue one, return of the jedi. You think disney disrupts netflix . I dont think its going to disrupt it, its going to be an equal competitor if i gave you a Million Dollars right now, place your bet, what amount of money would you put on disney, what amount on netflix, i would put 50 50. Three years ago i would put 100 on netflix, but netflix has had a tremendous runup and i think theyll hit 100 penetration and lose everything from disney, pixar, marvel. So all this incredible content, this is the yumyum content they cant live without is gone well, this is not the last were going to hear from you no. On this or any other subject. Always great to have you here on squawk alley. Jason dont at us its going to be a special Halftime Report today, scott walker is on the deck of the u. S. S. Intrepid. Im calling him maverick today docked in the hudson river good morning, scott. I was going to say, carl, im no longer the judge. You can refer to me maverick, ice man, whatever floats your boat today we are live on deck of the intrepid sea, air, and space museum for a special veterans day edition of the Halftime Report and doing it today with an all veteran allstar lineup, including vinny viola. You remember phil who played for the giants, won a super bowl, served in the navy well, he works in finance now, hes with us today and we have a live studio audience, as well. We are so despitexcited and hon about todays show see you at the top of the hour putting this week into perspective, scott, from a trading standpoint, taxes, tech, media, valuation, high yield, you guys are going to go to town yeah, whole thing, we have the traders all here i cant wait to talk to vinny viola, as well, about the lack of volatility in the market. Its been the calmest market, the calmest year in the market ever plays a direct role in their business well talk about that. The bond market with Phil Mcconkey and more. Coming up in just about 20 minutes, thanks. When we return, singles day officially in full swing in china. 5 billion in sales in the first 15 minutes wergog tk e intoalto alibaba president Michael Evans when squawk alley returns take a look at shares of nvidia up nearly 6 . The companys q3 results heavily toppling wall street estimates thanks to surging revenues from its core Gaming Market let me tell you, gaming is hot again. This comes the same week we heard about this partnership between intel and amd, a key amd executive leaving there, joining intel. Intel going to invest more in discreet graphics. Just goes to show with all this talk about artificial intelligence, theres more to it than that. Its also still about graphics, rendering visual effects and lots of investment being poured into that. The ones who did it long ago like nvidia reaping the benefits theres a seasonal factor here, as well, in terms of the Gaming Business with the success of the switch program, the nintendo program yes, 59 of overall revenue does come from gaming data center was also Data Center Revenue nearly tripled. Is that right . When people ask do i buy the consoles, game makers, or chip makers, how do you put that on a spectrum i think its tough. Right now im getting a lot of questions from people about esports, you know, there are a lot of investors out there, how do i invest in this because its huge we have raul sud here on squawk alley with unicorn. People are looking at betting on esports, but really one of the ways is just the graphics, right, because if people are going to watch esports and these intense competitions that are multiplayer, theres got to be a chip that can render that and show it to people. Thats what nvidia is doing. Explains the stock moving this year on top of 200 last year Michael Evans, president of alibaba on the other side of this break as singles day kicks off officially in china. Well be right back. Alibaba singles day is now well under way the company saying they hit sales of 5 billion in the first 15 minutes last year it took an hour to reach 5 billion joining us this morning at post 9, david faber made his way back to set and mike evans, president of Alibaba Group joins us. Mike, good to see you. Watching the early returns come in, how early can you make a call what the overall sales will be you know, its way too early to make a call on the overall sales. Ill give you a couple perspectives, though, the first billion crossed the line in two minutes and at the 30minute mark we were at 7 billion u. S. , so things are off to a rapid start. This year we expect its going to be a much bigger event given we have 140,000 brands participating versus 98,000 last year, and we have half a billion consumers who are engaging and just watched the fourhour gala, which david participated in four years ago, so theres a lot going on the new retail, the entertainment we brought to this event is going to make it a pretty spectacular performance, i think. I can remember it well, michael, being there in person this morning, though, the wall street journal writes a story that says effectively singles day is starting to lose its cache and they cite a poll in which i think less than 65 fewer than 65 of those polled are going to participate versus much higher numbers a couple of years ago. How do you respond to that is singles day losing cache in part because apparently deliveries are tough to complete given all the orders that come in i think the polls got it wrong. Let me give you a couple of data points last year we had 647 million packages that needed to be delivered, all of which were delivered successfully this year the International Participation in this event has gone from 10,000 brands to 60,000 brands. So i dont think were losing steam, i think were gaining momentum that together with the innovation that were bringing in terms of new retail and the entertainment value, i think, is going to make things for a very successful day not as though chinese consumers are not familiar with the alibaba platform they use it numerous times a day, many of them. Why does this day remain an important one . I can understand starting it, launching it many years ago, bringing a lot of attention to the platform or the capability of it, but why do you need singles day anymore . Its not that we need singles day, its the opportunity for merchants and consumers to have fun and engage in something thats really exciting its the opportunity for consumers to explore and find new brands and new products. When we move from 10,000 to 60,000 International Brands selling products on the platform this year, thats a great opportunity for curious, young, affluent chinese consumers to take advantage of that the other thing is that new retail, so the integration of our online and offline activities is providing a new experience for consumers and a very valuable experience for merchants. So theres a huge play here in data and technology, which is brand building and customer building for merchants and brands so theres a lot of new features that have been added this year that benefit both the Consumer Experience and the Brand Experience michael, is there something that the best, smartest International Brands or even u. S. Brands are doing as they participate in singles day that others, you think, should emulate . Is there something beyond just making your stuff available that makes them particularly effective . I think two or three things, david, that brands are doing first of all, unlike amazon, we provide all of the Customer Data to our brands, and so were teaching brands how to use that data, both to build their brand in the china market, but also how to use it to target new customers. Secondly, were teaching brands how to integrate online and j f offline so its a experience bue are also greater efficiencies for the brand in terms of the way they collect data, the effectiveness at which they can operate between online and offline and therefore the sales they can generate in addition to what they would have been doing normally so these are big, big changes. The smart brands are embracing them and others are watching with interest michael, how do you think about the fragmented world of physical retail . We noticed youre incorporating Convenience Stores and malls more as smart stores into this big Online Shopping day. Jeff bezos out buying whole foods, alibaba has bought way more than that already in terms of physical locations. How do you merge the two and think about what the Retail Experience is and the future some of our competitors want to kill Offline Retail we want to embrace Offline Retail in china, for example, 18 of the market Retail Market is online that means 82 of the market is offline. We believe that for consumers and merchants if we can integrate the 18 and the 82 , we will be taking advantage of the data and the opportunities in that for both merchants and consumers sochlt in our future whether its popup stores, whether its the small mom and pop shops, whether its the big retailers or the brands, we want to integrate everything theyre doing into one seamless process for both themselves and their consumers. Thats the future. Finally, michael, a lot of speculation about how global alibaba really wants to make today. This event and how much of that translates to cultures that dont have some of the dynamics related to inherently chinese david, ill give you an example. I hosted this evening ambassadors to china from 22 countries around the world that are participating in this event. Most of them for the first time other parts of the world to the china market to focus on the chinese consumers. In addition were also selling products from china to 100 million chinese consumers who live outside china and through our express platform to another 50 to 75 Million Consumers who buy products in 200 countries all over the world so this is an inclusive event. It involves obviously a very big focus on china but the international portion continues to grow. Yeah, well, michael, speaking of international, you know, alibabas ambitions of course do extend, as you say, beyond china and frankly beyond simply delivering consumer goods to Chinese People youve got cloud, youve got obviously a connection with ali pay in a very significant way although financial different company. Ten cents here in the United States is starting to raise its profile. We were spending a lot of time the other day talking about their investment in snapchat youve run international youve overseen that part of the expansion of alibaba or is ten sen getting a lead on you as the other giant in china as in terms of the other investments its making around the world to further its ambitions . You know, david, i dont think so ours is built around our massive platform our cloud and our payments capability and of course our Digital Media and entertainment and the social experience people have on our platform theyre really two very, very different Business Models and therefore you would expect that the acquisition appetite and the types of things theyre going to invest in are very different and do you continue to be interested in other assets outside chinese borders in terms of investment . In other words the time when alibaba seemed to figure so prominently into any discussion, whether it be movie studios or you name it here tharks seems to have abated a bit. Have you given a message that youre not as focused on those kinds of investments a very significant part of our globalization strategy is to make very Strategic Investments in poor markets around the world that are going to be a critical part of our platform in the future so the answer to your question is, no, we havent given up. But we are extremely disciplined. Were low profile. We dont make big splash shi announcements when we make investments. We prefer to integrate them and carefully add them to the portfolio of companies that are going to be the big part of our longterm strategy. All right one thing that is fairly high profile is singles day so you did almost 18 billion last year in gross merchandise value. Come on, give me one prediction here in terms of what youre going to end up at today, michael . David, you know we dont do that if you were here, it might be a different situation. But ill tell you, be a lot bigger than it was last year. All right a lot bigger than last year. I do want to show up again because it is quite something to witness. Michael evans, thank you as always welcome you and the team the whole time. Thank you Michael Evans, president of the alibaba. Little grief there for not showing up this year as we head to break take a look at bitcoin sliding a bit this morning now shy of 7,000 but oneyear chart up she thought 865 as a fire. Squawk alley will be right back it was worse. It was worse. A sinkhole opened up under our museum. Eight priceless corvettes had plunged into it. Chubb was there within hours. They helped make sure it was safe. We had everyone we needed to get our museum back up and running, and we opened the next day. Apple has released a patch to fix the autocorrect button thats popped up in ios11. The glitch changes the letter i to an a with a question mark and a box in some users texts. What a weird glitch. How does that happen the new update also fixes an issue where siri stopped working. For me the big takeaway here is we use so many of Certain Companies devices that they can affect our ability to basically communicate. Its a if a key popped off of everybodys keyboard around the world and they were unable to talk about themselves. Theres no i in team. Didnt you preempt this didnt you already figure out a work around . I think a number of people figured it out to be fair, but, yes, the auto correct thing, it mostly works, but somehow in a tweet i sent out yesterday it still had the yeah, seeing a lot of it. Overall markets major averages down for second day here nasdaq down three and four its been nine weeks since weve had stocks fall for the week and it looks like its finally going to happen though not by a lot. We mentioned next week will be busy with ges report on monday but also earnings from walmart, cisco, tencent, gap, abercrombie. Coke has an investor day also, which well be at. So theres a lot to watch and President Trump is still in asia in the early part of the week. Walmart walmarts going to bea big one for tech reasons. Thats true. Lets get to the judge on the intrepid celebrating veterans day. Announcer today americans from sea to shining sea honor our veterans, the men and women who fought to keep this great nation free. [ gunfire Halftime Report team is honoring those brave men and women as wells a we host soldiers, sailors, members of the air force and marines, our missions clear, help guide them through this historic market rally giving them access to some of the best and brightest investors on wall street today were talkin