Higherlevel employees. The committees that oversee hong ,ongs Financial Sector lawmakers want to know how the Hong Kong Exchange and its regulator will protect investor safeguards. Global news powered by 2700 journalists and analysts in more than 120 countries. This is bloomberg. Markets in hong kong coming out of the break, a snapshot of how we are doing. We will have an update and one half hour. This is bloomberg. Emily im emily chang, and this is bloomberg technology. Of theeats estimates Fourth Quarter as the iphone x starts worldwide sales. The clock winds down to the of this will start the official start of the iphone x era. Alibaba plans to go full steam ahead the rest of the year. Business helps double revenue. My conversation with former twitter ceo. His take on Holding Big Tech accountable. And intensifying the crackdown on trolls and bots. Our lead is apple out with quarterly earnings. The Company Quarterly sales exceeding expectations. This is apples most important Product Launch in years. Shares hit records this week. They rise in late trading. In stores sale worldwide starting now. We have pictures of you of the apple store in sydney. More than 200 waiting for the iphone x. They just opened the doors. Lots of photographs happening. People waiting outside of stores in tokyo and singapore to get their hands on this new phone. Joining me in the studio, julie, lets start with the numbers. They look good. The outlook is strong. It is a bold move to sell a device for 1000. The demand race the demand remains strong. There are some supply issues. I did ask tim cook about this when i spoke to him on the phone moments ago. He did not seem worried about it. He said this is the most advanced iphone ever. He is happy with how the ramp is going. They will make reductions in wait time today or tomorrow. We can expect the wait time to go down. Julie that is the case. No organization builds capacity to hit the demand. They have a producing these devices for a while. Apple always meets or beats expectations. They may be setting expectations of four to six weeks, but i would not be surprised if consumers get them in the mail before that. Emily knowing that this is the quarter coming up, with people waiting in lines for the phones julie it is exciting for apple. Represents 70 of the revenue. At what point are they going to break out devices, and that there is a keen eye on their services businesses. Emily it grew 34 year over year. Is, how long can they keep up that kind of growth . Julie it is also hard to get a bigger growth number. There is only going to be more momentum in this market. There is only more incentive for me to find out Services Like apple music that can work across all of the devices. This talk about china. Apple return to growth in china. There were Big Questions of people would want to pay up for a phone this expensive when you have alternatives that are half the price or less. I asked tim cook about china, he said the mac was strong. Their services hit an alltime high in china. In addition to the iphone, the other businesses are doing well. He suspects china will love the iphone x. More data than we do. He will talk more about that. This is like going back to the early generations when people camped out outside the stores. You may see a lot of demand for the product. We may see a slowdown and how frequently they refresh that. We replenish our laptops every two years . Are we going to see people get closer to a 30 month cycle rather than a 24 month cycle to justify the cost on a month by month basis. Emily tim cook is pleased with the sales so far, but are you concerned about the iphone x cannibalizing their other sales . Julie they are very good at adjusting prices on the other products. They tend to still do well with those products. Emily as we watch the rollout around the world over the next 24 hours, what we you be watching for . Dont know of there something specific we are watching for. Thell be interested in release numbers, what the preorders are, how much demand there is for the device. Seems to be strong in san francisco. They we are listening into Earnings Call. We will bring highlights as we have them. I know you will be listening to that call. We will be catching up with this call throughout the show. Thank you. When we continue, the price of bitcoin moves higher. The latest boost in the price comes after the owner says they plan to release Bitcoin Futures later in the year. Goldman sachs Ceo Lloyd Blankfein gave his outlook on the cryptocurrency. I have a level of discomfort with it. I have a level of discomfort with anything that is new. I have learned that a lot of things work out well. Emily in the meantime, another banking ceo commented on bitcoin. Credit suisse ceo called the Digital Currency the very definition of a bubble. Coming up, we will discuss alibabas dominance as the Company Turns in another blockbuster earnings report. Take another look at this live shot from sydney, with a time is friday, 8 00 a. M. , the iphone x now on sale at the apple store. This is bloomberg. Emily after he and year of monster growth, alibaba has raised its outlook for Revenue Growth. Chinas biggest Commerce Company , results were boosted thanks to its core ecommerce business. For more reaction we are joined by kevin carter. Holding in thep index. What is your biggest take away from . Kevin its amazing a company can grow at the rate it is growing. The growth rate has accelerated. A year ago it was growing 40 . Last month it was 50s. What are your thoughts of the new retail plan . It makes a lot of sense. Amazon has bob whole foods. It gives that distribution points, and physical locations. Both jd and alibaba have been aggressive in this regard. They have partnered with gas stations. It is a new chapter of onlines offline. Think itw big do you will be this year, and how significant . Kevin the singles day Growth Numbers have not been as great as the annualized numbers for revenue. We are forecasting a to 22vative 20 billion billion. That will be up from 17. 8 billion all stop it will be at least 20, and possibly 22. One of the things exciting is that it is not just people buying physical goods. Alibaba is an investor, and they sold 100 million return insurance contracts. It was 13,000 the second. It will be an exciting single day as it is. 61 growth as the quarter ends. Think abouto you the future of alibaba and the chinese economy at large . How optimistic are you at the chinese will grow as it has . Kevin im very optimistic it will grow. The growth will slow down. 6. 5 to 6 to 5 . That is almost certain. The breadth of the involvement they have in the economy, people do not realize the investments they have in other countries. It is not just ecommerce with alibaba. It is payments and physical locations. Growth stillt of left for the sector and alibaba. About the ceo was asked the outlook for subscribers. He did not give a for a straightforward answer. What is your outlook . Kevin they did not give clear guidance. The userbased numbers are going to flatten out. They have a decent percentage of the population. Curve ing will be the terms of members. In terms of amount spent, i think that number has a lot of room to go up. Shares have been surging. Can the share price continue to grow . Kevin sure. And a longterm share prices follow earnings. In the short term they follow sentiment. Evaluations are still quite reasonable. The whole sector of emerging about the same looking forward. You have 60 Revenue Growth for alibaba, and 40 for the sector. On a growth basis it is about one, with s p 500 has a pe less than 5 revenue. Investors with amid to longterm timeframe will do well. How much growth are you expecting to see in the Cloud Division . How critical is that cloud unit to alibabas future . They have a hundred percent growth quarter. The cloud, even here for amazon, the web services, both of those businesses are in their early stages. As an entrepreneur, i send my first cloud related deal with amazon web services. Early for is still that business in china for alibaba as well. Emily kevin carter. Thank you. Chapter in the bitter legal battle between apple and qualcomm. Qualcomm has sued apple, accusing the phone maker of not the two companies are embroiled in ashley dispute over technology. Apple says qualcomm is unfairly charging too much, and leveraging its strong market position in chips and legalese. Republicans unveil a tax cut plan. We will give you all the details. That is next. Take another look at this live shot from inside the apple store in sydney. The highly anticipated iphone x on sale now and around the world over the next 24 hours. We will be watching. Emily President Trump said Semiconductor Company will return headquarters to the United States from singapore. President and the the oval office for the announcement. The president touted the amount of money that will come into the u. S. As a result of the deal. Will move backey to the United States. It is something very special and important. You have seen this happen with numerous companies. With this commitment, more than 20 million in annual revenue will come back to our cities, towns, and the american workers. House Republican Leaders rolled out there sweeping tax plan. Among the highlights, cutting the Corporate Tax rate to 20 , and reducing the number of individual brackets. Several of the biggest corporations including apple would no longer be able to escape taxes and the trillions in overseas profits they have accumulated. U. S. Companies have stockpiled as much as 3. 1 trillion offshore. Apple, followed by microsoft and oracle. Joining us with how this impacts what does this mean for a company like apple . Mark for apple, they generate profits locally. The 20 tax rate is a good thing. They also have an immense amount of money overseas. The 12 tax on overseas cash is a big source of concern. Theyre going to continue to tax foreign subsidiaries going forward, assuming this tax plan passes, which is a big assumption. Not great for Big International companies keeping money overseas. Apple has two hundred 50 billion overseas. We are looking at a rate as high as 12 , we thought would be closer to 10 . Bloomberg has been talking to analysts saying it is borderline business unfriendly. I spoke to apple a few moments ago. , we have always been a strong advocate for tax reform. Theill drive investment and u. S. It will drive job creation and the u. S. He said, we dont know the details. And with the gridlock in washington it is not close to what we will see later. Investors,re telling do not worry too much right now. This is not the final tax them. They will continue to make markups. It may not even pass. They have a very ambitious month and a half to get this through. It is crazy in the world of washington. Emily explain the impact you expect this to have on the private market. Is whatplan we see now it is . Mark it has great things for private companies. There is a lot of talk during the campaign about a tax policy cult carried interest which that did not show up in the bill. Groupnture Capital Trade has told my colleagues that they are expecting changes to the way that startup employees exercised stock options, which allows them to defer when they have to pay taxes on a huge chunk of their compensation which they get in stock. That is a great thing for startup employees out here. Caveat isexpected this tax on university endowments, which are huge investors into Venture Capital bonds will stop into Venture Capital funds. They are freaked out they are targeting universities. Emily what does it mean for individuals, specifically Silicon Valley ilion errors . As theyt as great helped. They tend to skew liberal, and are not as sensitive to taxes as other wealthy people. They did not get the highend tax break that republicans, andcially the president leaders in the Republican Party have been pushing for in the senate. Also, the exemption for electric cars getting tax breaks. All the tesla lovers out here may not be able to get a tax breaks. Is there just a lot more gridlock . Mark it is going to be a race to the finish. There describing it as a watereddown tax will. Now that the details are public, especially to democrats in the house, there will be a lot of infighting over what stays in and what gets pulled out. That is just the house. Emily thank you for breaking it down. Ceos declined tex to testify before congress this week. We found i would twitters former Top Executive thinks about this weeks capitol hill hearings. Once again, another live shot inside the sydney apple store. The highly anticipated iphone x on sale now. Speaking on the Earnings Call as we approach the holiday season. He said, we expected to be the biggest quarter ever. Headlines from the call. We are listening and right now. This is bloomberg. It is 1 30 here in hong kong. We will start off with china. This latest move is to rein in capital outflows. And get approval for sensitive projects. Trump has praised president xi jinping over korea. He believes the north Korean Nuclear problem can be solved. Has. Trump president xi been pretty terrific. Whether cutting the Banking System of from north korea, cutting supplies down. North korea is a thing i think we will solve. If we dont, it will not be pleasant for them. Pleasant, ibe guess, for anybody. The news out of venezuela, the country will restructure its debt. It will be making a one dollar billion payment on its oil bonds. Goldman sachs is the biggest owner of its u. S. Dollar debt. Global news powered by 2700 journalists and analysts in more than 120 countries. Lets go to Juliette Saly for an update. Looking at the japan is closed for a holiday today. The regional benchmark on track. Stocks. Vement and is ip we are watching the apple suppliers. We have seen some of those suppliers rally. Chinese bonds are under quite a bit of pressure. The aussie dollar is falling after flat retail sales for the month of september. Hong kong retail sales are coming. This is bloomberg. Emily yesterday, lawyers for twitter, google, and facebook lawyers ongrilled by capitol hill. They were forced to answer about possible russian interference in the 2016 u. S. Elections happened on their platforms. Their ceos were notably absent all stop i spoke with the twitter ceo for his thoughts on what went down in congress this week. And how much responsibility these three companies bear. It was separated into two things. Responsibility once they understood the problem and issue to discover the scope of it, and address it. And i think they are doing that. It would be a mistake to say that their responsibility for missing it. This is stop that has come to light after the elections. I dont think anyone new what happened. Everyone has been seemingly surprised by it. It is a matter of doing the detective work to find out how deep and broad it was, and attack it as quickly as possible. Shouldwhat changes twitter do . Made an aggressive statement about how we will be more transparent about political ads that are purchased. We will be more aggressive on abuse. Those are great steps. I would like to see us be a lot more aggressive. Emily some people say the ads are not the problem, it is the number of fake accounts. People pretending to be somebody else. Twitter said in the hearings bots. Hink 5 are i trust the folks inside the company if they are giving the number publicly in front of the house hearings. I expect they believe that is the correct number. ,he thing you have to remember sometimes there are researchers who say it was a lot higher. Theyre going off of raw api feeds. Theyre looking at tweets coming to programming interfaces before twitter delivers them to users. Emily is it true these networks are essentially ungovernable . You have hundreds of people trying to monitor more than 300 million accounts. Know. I do not think that is true. You can apply all sorts of Machine Learning techniques, and other kinds of algorithms to do the things you should be doing, and do a better job of. Like protecting the community and making sure the information delivered on the platform to the greatest extent possible is not foreign propaganda, and fake news, to use the term of the day. These proceedings were called fraudulent. It is ridiculous to blame these social networks for potentially swing the election, and spreading information when there of whatad spectrum misinformation actually is. What you think . I will try to take a more nuanced approach to the answer. On one hand, you could say people lie on tv all the time. To one or twot News Networks and say, that was not remotely true. It is not facebook, twitter, and googles problem. It is everybodys problem. My position is more, we have to take responsibility for trying to prevent this from happening again. It is the leaders in the Technology Field who are delivering algorithms that we think are best suited to deliver the right information. We need to bear the responsibility for addressing this. I want some of the hearings, and counsel, of twitters and is one of the more ethical people you could ever get to meet. I think it would have been better if those hearings were more about problem solving in finding solutions, and less about political theater. You get longwinded statements that come with questions in the form of an accusation that seem designed to make the person answering look either complicit or stupid. Choose one. I would like to see them be more about, lets Work Together to find solutions, and problem solve, instead of blaming people to get on the even