Future of the city of london. We have to face our social and environmental challenges. The lives are being saved for very small amounts of money. The last thing the world needs is a currency war. Haslinda it is all straight ahead on bloomberg best. Haslinda hello, i am Haslinda Amin. From the World Economic forum in davos, switzerland, welcome to a special edition of bloomberg best. We have met with the most influential people in the world, discussing what they think are the most important topics and the most urgent challenges facing business and society. And of course we have also been , keeping our eye on the stories shaping business around the world. Starting monday when legislators agreed to reopen the u. S. Government. Senators, duly chosen and sworn, having voted in the affirmative, the motion is agreed to. Reporter the senate moving to end the u. S. Government shutdown after three days with a temporary spending bill funding the government through february 8. Yousef President Trump has signed a bill to end the Government Shutdown which leaves the dreamers fate still unresolved for another three weeks. There are a lot of good people in congress, but the Business Model is broken. If you spend your time blaming the other side and bipartisanship is a dirty word and it gets you hurt in your primary, then we are doomed as a country. President trump has long talked tough on trade. And now, it looks like he may be taking some action with a decision, putting tariffs on solar panels and washing machines. Obama had solar power not tariffs. This is not a new thing. It is not a new thing. I thought it was wrong when obama did it and i think it is wrong when trump does it. It is bad for the american economy, bad for the Global Environment bad for jobs in the , United States. Does the president s decision to slap a tariff on solar imports change anything for you . For us, it is not going to change our approach. We generally agree with free trade. It will not change our direction on developing solar projects. Reporter were you planning on making investments in the United States that you might reconsider . Guest we still have plans in the United States. What we bought into in december was about 40 , in the United Kingdom. That was the largest Solar Developer in europe. It has projects in the middle east and india. That is the focus of that company. I do not know how exactly this will change our direction. Not much. Steve mnuchin is endorsing a the dollars decline. He says, a weaker dollar is good for us as it relates to trade and opportunities. He said a weak u. S. Dollar is good for america. Do you agree . Guest i think it all depends why. When you think about the dollar today, it has weakened and it has baffled some people. There are two likely scenarios out there. One is what we talked about at outset in terms of the surprisingly stronger europe, the stronger rest of the world , has now moved Central Banks into a position where they can start to normalize and raise rates. Just like we saw in the u. S. In 2014, a pretty robust move in the dollar as the fed started that. We can say its a bit of a correction. If that is what it is about, n adjustment, if that is what it is about, that is fine. The other side of the potential argument is that there is fear and it is a precursor to a protectionism and potential trade wars and causing people to shy away from the dollar. If that is what is causing the dollar underperformance, it is more concerning. The ecb holds steady. Mario draghi seeing very little chance of a rate hike this year. German Bond Investors see no reason to sell. Sending the 10year bund level to its highest level since 2015. Francine how can you be so sure that inflation will come to europe . Guest because we see it in the last two years. If you remember two years ago, we had still a danger of deflation. It is now over. The first success of our Monetary Policy, and it was a message that we expressed yesterday, a message of confidence and patience. Confidence, because we are confident that in the path of gradual normalization of our Monetary Policy, this gradual normalization is progressing in an efficient way toward our inflation target of 2 . But patience, because we are not yet there. A tumultuous week for the dollar. On wednesday, secretary mnuchin said a weaker dollar is good for us as it relates to trade in opportunities. Currencys shortterm value is not of concern at all. In an interview yesterday, President Trump said that mnuchin may have been misunderstood. As he put it, our country is becoming strong and the dollar is going to get stronger and stronger and ultimately, i want to see a strong dollar. Francine there has been so much talk about whether we are entering a phase of currency wars. If we are, how much will that complicate things . How much does that complicate the work of Central Banks . Guest it is the last thing that the Global Economy needs today. We live in a world where Interest Rates should not be targeted for competitive purposes. Thats what the g7 and g20 have agreed. Let us stick to that. We have seen lots of volatility being created lately with different statements. I think that has not helped at all. President trump i am here to deliver a simple message. There has never in a better time to hire, build, invest and grow in the United States. America is open for business, and we are competitive once again. He sold America First as america for everyone, and did a very good job i think, of speaking to his audience. He almost appeared to be a globalist in some ways. President trump we are also working to reform the International Trading system so that it promotes broadlyshared prosperity and rewards to those who play by the rules. I think the people there and people around donald trump will think it was a great decision to go to davos, and i think they will be invited back next year. Haslinda still ahead, ubers new c. E. O. Discusses the companys cultural turnaround. There are no excuses for not doing the right thing. Haslinda up next, the biggest names in finance tell us how they see the Global Economy, up economy. We have seen the numbers up with growth, but trade even higher. Haslinda this is bloomberg. Haslinda from the World Economic forum in davos, switzerland, this is bloomberg best. I am Haslinda Amin. Its an annual ritual, getting a read on the Global Economic climate from the worlds financial leaders. What are they excited about and what worries them . Lets start with imf managing director, christine lagarde. Christine we upgraded our forecast for 2018 and 2019. What is characteristic of that upgrade is that it is significant. 3. 9 in 2018 and 2019. Second, it covers a wide range of countries, not just of the emerging markets leading the charge, not just the advanced economies. Its pretty much across the board, but for some countries which are not seeing a capital on a capital basis income , growing, that is primarily the subsaharan african countries. When you look at japan, the u. S. , turkey, some of the big emerging market economies, we have upgraded pretty much across our range of countries. The one that did not get an upgrade is the one the United Kingdom. We left it where it was. Francine if we see more protectionism, does it hurt the forecast, Going Forward . Christine what we see is growth going up but trade even higher than growth. Trade is a significant engine of growth, of reducing inequality between countries, as we had ve seen. Clearly, trade is has to be fair and in accordance with the rules and be reciprocated. The tools need to had by the trade players to make sure this is the case. I think that is the area where everybody will rally around some of the themes of President Trump. It is not an issue of being protectionist, because protectionist measures generally do not help trade or growth. But looking at the rules, resetting some of the rules eventually, in view have what is happened in the last 10 years, whether it is through automation or financing, all of that needs to be looked at on a regular basis. Jamie it does look that the immediate future is pretty good. I dont see the potholes that will reverse it. Geopolitics aside theres , nothing like the leverage of the system in 2006 and 2007. We had a lot of subprime mortgages. That is not true. Households were overleveraged. That is not true. Hedge funds were much more leveraged than we are today. Remember that unwound very , quickly in 2008 and reporter 2009. In some respects, it anticipates my next question. Is there any reason to believe that this part of the cycle, 20182019, are going to be the next 2006, 2007 . The euphoria before the crash . Jamie i do not think so. You need that excessive leverage to have what happened in we are going to have a 20082009. Recession one day, and when that happens, stock prices will go down. Hopefully, it will be a more normal thing. Not that i am wishing for it, but it will happen. At this point, i am less worried about Monetary Policy and the realignment for a more natural stance, which is starting in the u. S. And europe and eventually will move to japan. Markets are very exuberant now. We have markets at record highs, and we know that these things do not go in a straight line. You run the biggest equity shop on wall street. Do you think that the prices are overbought, that prices are very high . Imagine that i was one of your clients. I think that markets are expensive but they are not ridiculous. There are some sectors and if you look at some of the socalled fang stocks they are , trading at very high multiples but they have extraordinary , growth. The way that you value equities is by looking at the net present value of your future earnings and you apply whatever market model there is today. Future earnings are growing and at the same multiple, you will see the s p reaching highs. Francine because of volatility levels in the market, it has been a tough year in general for investment banks. Is 2018 expected to be better . To my comment on taxes. I think it was a Huge Positive for the u. S. Economy and the world economy. If the u. S. Economy is doing well, it is important. There will be a lot of investment in the u. S. Economy. Keep that in mind when you think about protectionism. If the u. S. Policymakers want more investment to come in, they will have to be pragmatic. Lets just say that. It makes me optimistic. Since the beginning of the year, we have had a rare combination of equity markets going up, volatility going up. No one likes it when markets collapse. This is a very good conjunction of markets going up and volatility increasing a little bit. The year has started very well. But you cannot draw too many conclusions from early trading days. Reporter youve had a few weeks now to evaluate the tax bill. This is where i am going to start. How it affects your business, how it affects the competitive environment. What conclusions have you drawn . Guest relative to the place of American Business in the world, our competitiveness has improved. I think we have caught up to the rest of the world, and i think it was an appropriate thing to do to make American Businesses competitive with other businesses of other developed markets. Reporter does it change the competitive environment for your industry . Guest our industry was a relatively high taxpaying industry, and now we have converged with other countries. They did a good job of widening out the base and removing deductions, and having a common rate for everybody. They have equalized the consequences of keeping money overseas versus bringing it home. I think it has made the system more sensible. So to that extent, we like operating in the sensible system. Francine do you believe the u. K. Regulators are looking at the u. S. And ready to relax the rules themselves . After all, brexit is happening. Guest post the financial crisis , i think there was a consensus around the Major Economies of the world that we needed to reregulate the Financial Markets and do it in a way that ity broadly speaking across those markets. So that no institution could arbitrage one regulator against another. I think a lot of good was done and i think a lot of important new regulation was brought into the Financial System over the last 10 years, and we consistently or i consistently supported a more regulatory environment. But now, there is a new equation to it. It does seem as if the u. S. Is willing to be very much on the front foot in terms of making the u. S. Market competitive. The barclays Business Strategy is a transatlantic bank, so 40 of our revenue is generated in the United States. The u. S. Has become one of the lowest tax regions that we operate in. That is a new phenomenon we have to recognize. Reporter there is a lot of cash on the sidelines. Investors have cash on the sidelines, banks, consumers, and they can feel that they are being left out. It feels stupid to own cash in this environment. I think it will be great for earnings and great for the stimulation of growth. We have to look beyond that to say, what is Monetary Policy going to be . How difficult is Monetary Policy . Now, lets take a look at that. We could look at step one, the blowup stage of everything. Reporter before we get to Monetary Policy, how long do you think we are going to enjoy this perfect environment . When i say we, i do not mean just the financial community. Clearly it is good for risk assets. If earnings are great, presumably that is good for stock prices. But companies are raising wages, doing hiring and investing. Some of it is trickling down to the real economy. How long will people be able to enjoy that . Guest if you look at it, it will be a 12 to 18 month growth spurt, and then when that is happening, the central bank will not have to tighten Monetary Policy. Here we are, Financial Markets are up three times since the financial crisis. Three times. The pool of money sitting in cash worldwide has never been greater. It is a problem. It is a problem in china where it is 45 of disposable incomes sitting in a bank account. If you speak to the french financial minister, 72 of all french savings are in a bank account. Reporter no interest. Guest can you imagine the type of inclusion we would have worldwide, if we had better financial literacy, more investing over the long run . The type of financial gains that people would have in their 401 k . I think that is one of the bigger crimes that we do not talk about. And that is one of the reasons why i believe we have more momentum because of the pool of money that is sitting around. There could be an alliance between authoritarian states and these large datarich i. T. Monopolies that would bring together a nascent system of corporate surveillance within already developed systems of statesponsored surveillance. They may even result in a web of totalitarian control. The likes of which not even Aldous Huxley or George Orwell could have imagined. The countries in which such unholy marriages are likely to occur, first, are in russia and china. The chinese i. T. Companies in particular are fully equal to the american ones. They also enjoy the full support and protection of the president of the xi jinping regime. The government of china is Strong Enough to protect its National Champions at least within its borders. Haslinda welcome back to bloomberg best. Im Haslinda Amin at the World Economic forum in davos. Uber has been under a global microscope, one of the worlds most valuable startups has been mired in controversy as well as burning cash. The new c. E. O. Has set his sights on changing the culture and steering the company towards profitability. He discussed his goals with bloomberg editor in chief john micklethwait. I think you lost 4 billion last year. Dara profits will help. At some point, we have to become profitable. That is part of the plan. Do you have a goal to be profitable by 2022 . Guest i think we will be profitable by 2022. Would you like to go down a bit maybe 2020 . Guest i do not want to name a specific year, but this is a business that the core business, the ridesharing business can be profitable within three years. We will continue to make very aggressive investments in building out autonomy. We think that is a terrific opportunity, building out new technologies such as uber elevate, where nearterm profitability is not a goal, but longterm growth is. We will look to balance nearterm profitability. But as a company, we will always company that makes big bets and takes risks. What about this culture change, you talked about making money, but not at all costs. Do those two things . Guest i do not think profitability and culture are the issue. The company in the past was willing to make tradeoffs as it related to how we did business. And i think was guilty of hubris. Guilty of thinking that the knew that they knew better than others, and i think what we know now clearly is that breakneck growth can hide cultural issues. That there are no excuses for not doing the right thing. As a