matt: it is all straight ahead on "bloomberg best." ♪ matt: hello and welcome. i am matt miller. this is your weekly review of the most important business news, analysis, and interviews from bloomberg television around the world. the week again with a blockbuster media merger as at&t announced its intention to buy cable giant time warner. big deal everyone is talking about. at&t agreed to buy time warner for 85 point $4 billion. is this even possible? >> it is possible. you just have to turn the clock that 18 months or so, when at&t. directv -- when at&t bought directv. a lot of people arrest in at&t or in index eased -- a lot of people invest in at&t or in icesx eased -- ind associated with it. is ultimately seen as a utility to many investors. directv and time warner are big, large moneymaking machines. >> people talk about vertical integration. that thatis thought brings the cost down for consumers. but this is basically at&t adding another asset into their bundle. of industries are effectively in decline, whether it is the time warner business or at&t's own business, facing challenges on the wireless front. betting onreally content, going for something very aggressive. this is a game changing transaction. afterle shares are lower trading. the company posting fourth-quarter sales that fell 9% from one year ago and wrought the company its first annual sales the client since 2001. the other number we are watching -- iphone unit sales. 44.54 millione -- units, including just two weeks worth of sales for the iphone 7. what you see is the highlights? >> apple will return to growth for the december quarter -- emily: they say. >> they believe. they're usually pretty good with that. other than that, everything is in line with expectations in terms of estimates for iphone numbers in the q4 revenue numbers. >> what investigates happen asking from tim cook is make up or grow again. the outlook in terms of revenue for the december quarter is excellent. to company will return growth. that is when we get stock moving again. >> let's look a cross german banks. deutsche bank set to be considering not paying ininesses -- bonuses in cash order to boost investor confidence. allegedly been talking about replacing cash with deutsche stock. it is a really intriguing removebecause you could a bunch of costs this way. you could temporarily pay bonuses like that gave you could also help capital ratio by getting rid of the non-core unit. ofdit suisse did a couple some -- did a similar thing a couple of years ago, which was profitable for the employees. but then the rules changed. it became less attractive. four of the company to do. on top of that, there was a morale issue. we will have to look to see if they can keep the motivation up. motivation is behind the revenue in deutsche bank to you to lose more motivation would hurt them. and especiallyk posting profits. the securities unit reporting a jump in revenue. barclays reported a 35% jump in earnings. let's start with the analyst rabbi the deutsche bank. we do not know -- with the analyst rap out of deutsche bank. thehe reason you have seen stock jumped is because there are still so many questions outstanding. certainly, people are happy to see capital increase. in a relatively quiet quarter, in terms of revenue up, cost down. kind of on track with their plan. but certainly, the big questions still remain. night and day.is deutsche bank versus barclays. yes, trading revenue up on the debt side, but it will be a tough year the rest of 2016. what is the story? >> barclays can afford to be a little bullish, because it started its investment bank restructuring a little bit earlier. with such a bank in fixed income trading. but with all of the noise around deutsche bank, one of their head of investment banks says they have lost market share because of distractions. maybe this market share is not only coming to the u.s. barclays but also to deutsche bank. this ceo shied away from saying that, but certainly hinted at it to you there will be a lot of instability in the investment banks. warn, a couple of good courses in a row does not mean they are out of the woods yet. >> banks headlining today's earnings. another day of ubs and others coming in above estimates, buoyed by the debt provision. >> it is not all happy days yet. take rbs. the bottom line is still affected by litigation and/or structuring costs. but the core decisions are doing better. bond trading lifting. even deutsche bank. has been you look at the course of the numbers being good, and investors are looking well beyond that looking at efficiency, cost cutting, restructuring. that is still very much the agenda for many of these banks. >> the u.s. economy picks up in the third quarter. the economy growing 2.9%, the biggest rise in two years. tothis is a story i want you break down. what's often was the consumer. so what picked up and will continue? >> that is the problem with this report. it is not as good under the hood. we saw exports rise. and, according to the congress department, a big rise in soybean exports during the quarter. that will likely not be sustained. early in the year, we did see the dollar strengthened a little , which is helped, but now the dollar has stronger. inventory and export, and end up with about a 1.4% growth rate, which is about where we have been growing. so you see where we could slip back in the next reports the next couple of quarters, if consumers do not pick up spending. we will will --matt: review more earnings reports later in the program. and monte paschi's ceo says he is found a solution to the bank's problem. he tells us all about it in exquisite interview. of next, a plan to finally upgrade london's heathrow airport. will it actually fly? >> we believe there is an economic case for the sanction of heathrow, but it cannot be done at any cost. matt: this is bloomberg. ♪ ♪ ."tt: this is "bloomberg best i am matt miller. quite a few big deals got done, but others hid regulatory stacks. we continue in the year two -- e.u., where there is a pitch income china's takeover of syngenta. china missing deadlines to buy the swiss herbicide maker. how much of a big deal is this, not submit on did time? of nexthad a deadline friday, were the commission gets to decide if it clears the deal or doesany provisions, it open a more in-depth probe. with the share dropped, we are seeing the level of uncertainty. waiting for five months for approval is tough when you want the deal done as fast as possible. when you look out a whole realm of possibilities, that is something you want to bury in the bag. >> shares in germany sloping after the german economy minister opened a review of its chipver by china's grand investment. the news comes as germany seeks tighter control of foreign investments, not to mention that you -- the e.u. is also weighing in. >> it is the latest move by the german government to get a grip on the chinese influx of investment, direct investment, which has reached a record this year globally. europe's biggest economy is obviously a great target. tom: this is something for everyone in equity trading. is trying to buy scott trade. a roughly $4 billion transaction. at the small deal but heart of so much online trading and the digital revolution. is td ameritrade's largest shareholder. what is in it for toronto dominion? costere is scale and savings. b scale comes with 3 million customers they are adding, not to mention 7 billion under management. on the cost side, you put the companies together. the estimate is they can save $500 million per year. >> we have about $1 trillion in client assets when the deal closes. and the founder of scott trade recognizes we have a number of platforms that are cutting-edge that he would like to have but did not have the scale to be able to can best -- invest in. tata group has unexpectedly removed its chairman and a sign of conflict at the top of india's biggest conglomerate. what is going on here? truth is there has been no explanation. we do not know why he was removed. in recent years, he was pushing for more this go prudence, bought after the company ,rands like jaguar and others and there are mystery refinance loans. he sold assets to tackle debt. people are already unwinding some of its assets to get that. he was considering winding up u.k. losses after losses last year. also, stakes in indonesian coal mines. the sent out there is that the board may not be upset with mis try. >> this is looking more like a bollywood movie. mistry accused the board of not giving him an opportunity and wrongfully socking him. the group has nearly $18 billion in write-downs. they are indian hotels. will --el, on automobile vehicles -- he calls them legacy hotspots. >> let's talk about infrastructure and air force. the british government has given the go-ahead to expand heathrow's airport. the government has at least come down on one side. >> seven years ago, david cameron was saying no if's or there were be no runway. it is a relief to get this decision. >> what does this do post-brexit? >> it is more necessary. ofcan deliver the benefits heathrow expansion as quickly as possible, including getting more off of our existing two runways, allowing to connect more u.k. regions. benefit asitain can much as possible from the european union. >> it is a missed opportunity. allowing a spanish mode -- allowing a spanish owned monopoly like heathrow that will not be delivered until 10 years and will already be full is not a solution. we need three additional runways, one each. at least you put competitive pressure on each airport to deliver an additional runway in a time and cost efficient manner. >> we believe there is an economic case for the expansion of heathrow. but it cannot be done at any cost. there is no way the cost should be passed on to our customers. if heathrow wants to expand, they should wear the risk, and they should deal with the costs associated with expansion. >> we are talking samsung, shareholders have elected lee -young as the head. >> he's the son of the current chairman, hospitalized after a heart attack in 2014. .y. is already vice-chairman. in general, looking out the profits. third-quarter net profit falling 70% after having to pull the north that -- the note 7 smartphone. those revised estimates came in after they had to recall the note 7. the mobile unit is operating at 87.8 million u.s. dollars. a record low, down from 2.1 billion. the biggest piece of economic data since brexit. whoa. bit of a surprise. to the upside. there you go. the economy continues to surprise, growing by 0.5%. we were higher than expecting, but i am not that surprised. when talking to our members, we have seen quite a bit of resilience in the economy, shanley -- and certainly in terms of the consumer, oh they are carrying on. that probably underpins some of the services. even on manufacturing, surveys have suggested stronger growth related to how the pound is helping exports. than the official data suggests. i think it is too early to read in what is the impact of brexit and is far too early to make any sort of judgments. m&a, qualcomm has finally reached an agreement with nxp. >> this is a defensive deal by qualcomm, which wants to move away from handsets. they need to diverse or five revenues and do so quickly and in a big way. from that apt deal perspective. you're getting into the auto market, which is a slower growth historically,e but it moves one third of the revenue or so from handsets and put it into an area growing, that is profitable. ♪ ♪ matt: you are watching "bloomberg best." i am matt miller. it is a challenging week for monte paschi, europe's oldest bank. facing a shortfall, ceo marco morelli wanted a plan to shore up the bank's balance sheet. he added details in their next visit with bloomberg television. shares of monte paschi surging after its plans to cut thousands of jobs and sell bad debt, which would attract investors to turn around. bring us the key takeaways from the business plan. a lot of freshot details. mr. morelli, the ceo, confirmed they are looking at raising 5 billion euros in the cap rating -- in the transaction they want to do at the end of the year. you have confirmation of the disposal are trying to get bad loans off of their books. and you have bits and bobs of cost but in -- cost-cutting. morelli on a conference call with analysts this morning received they have not gotten interest from potential "anchor andstors," large investors institutions. but we still do not know who these people are, how much they are willing to invest. the bank needs to raise 5 billion euros, possibly by the end of the year. >> are investors actively approaching you? investors so far have been proactive in approaching. either at the bank or investment bank working for us. as i said, at this stage, i that stage, we could not engage in a four-month dose. >> do you have a number in your head for the amounts of the capital raising you want to come from cornerstone investors, but are you open to our -- or are you open to all things? marco: we are open to things. this is a mixture of interest from core investors, from into industrial investors. lower some bonds in the next few weeks. so it is difficult to gauge, as we seek what will be -- >> what do you hope for. the amount death -- the might of debt, them out young to raise. what is your best ambition on this? the three legs of us are tied together, are they not? the bank is looking for long-term stability. we need to make sure the bank eventually -- >> how much of that $5 billion market would you like to see converted from debt. it is difficult to make decisions, to be honest. we actually receive huge toerest from shareholders attend hotel commercials. difficultage, it is the, with a firm number. but at the end of the day, we want to make sure the bank billion5 billion, $5 are the base upon which we would project the plan, and this is what we want. straight ahead, more of the week's most interesting interviews. what will 2017 look like for banks that do business in great -- and also the forecast for next year. .nd ceos gathering over obamacare. >> the neck's administration has about nine months to make something happen. matt: this is bloomberg. ♪ ♪ what is your read on the current health of european banks, especially those that are fragile and systemic and important? >> the european banking sector has gone through a lot of improvement the last few years. it has significantly strengthened its capital position. most banks.ted by as far as the system, internationally, they are under much stronger and more systematic, if i may use the analogy of words, supervision by the authorities. it is not at a pan-european level. i think it is certainly a reassurance for the market. that they are in better health. 's christine lagarde speaking with bloomberg. new york magazine hosted its year ahead summit, giving prominent leaders a forum to address urgent business affecting 2017. we start with the dow chemical ceo, who sat down with john micklethwait to discuss the status of the proposed $59 billion merger with dupont. >> what we are doing as two companies is herculaneum. we are managing each company separate but also managing for the combined future that, once approved, will move quickly through to the next phase to split into three. if you do not think complexity is my friend, i should say welcome to life. togoing to run -- two going is -- ig to three, this am employing a lot of accountants. the regulator is looking at that and trying to understand the where they are concerned, which is agriculture. all of you understand one of the strong as lobbies out in the world is the farm lobby. in europe, their agricultural sector is very critical to land. somewhat protected. >> does that mean you to do divestitures? >> we into phase two, meaning we question.evenue you notice i have ducked your questions so far. but in this scheme of value creation, this is $130 billion that will create another $30 billion of value for .hareholders at zero premium tax-free. it is or is worth a few months of delay. as i said, what we are doing without investors is walking them through the clarity of each step. we will get noise from these jurisdictions, that you -- of the eu in particular -- the e.u. in particular. at the end of the year, early next year, i will give you that answer. ♪ >> 25% forecast uptick in premiums. that alert came out on bloomberg yesterday afternoon. what is the read on that forecast? what does it say about the state of obamacare exchanges? >> we are heading into a premium spiral that will occur as a result of not having a balanced fiscal pool. the law was built around having a 0% risk pool from having enough young and healthy people covering sick people. that is the paradigm around health insurance, when we lost five years ago. happening is that because the bill was not passed the way it was supposed to, we have a risk pool running 10% or worse. then what you call a zero balance risk pool. so if you think about the amount of premiums and exchanges, it is about $44 billion per year. that means it is around $4 billion worth of losses. the risk pool and risk adjustment is built around a zero balance the economy, where people who pay in help people who lost more. what is happening as everyone is losing, so we are all settling at 10% and everyone is losing changes. >> president obama was talking about the affordable care act last week. he used the analogy that the affordable care act care act is like a starter home. it is better than having no home at all, but there is a lot of work to be done. what do you make of that? and for the next president, what is the first thing he or she should do and how much time does he or she have to do something to reverse this spiral you are talking about? >> the next administration has about nine months to make something happen before those numbers we saw today appear tame compared to what could happen. you have five states is only one insurer. who takes all the risk. that will drive rates up higher. >> from our perspective, just narrowly from the financial sector, and our institution, there is nothing good about brexit. we love the rule of law in england. we love -- are folks like working in london. you have the ecosystem and types, theure, the plumbing, pr, it is all header -- headquartered there. have legale to entities, where legal -- there trying to minimize absolute minimum number of people we do that for. hopefully, we can transition that. itther thing is that because is a global firm, of all of the lines of businesses you have, particularly trading businesses, d need to have them in london, frankfurt, paris, or new york or hong kong or tokyo? that door will open of people looking at exactly why they geographically place where there placed. >> which places do you think will gain from that? you mentioned new york, but others? >> based on time zone, new york -- from infrastructure, time zone, and other perspectives, if there is to be a move out of europe, it will head towards the u.s. i am not saying it will be large scale. but on the margin, the assumption is everything would now move to another european country is not necessarily the case. also this week, erik capitalizeraveled to for kids, a gathering for top financial leaders that benefit kids initiatives. big-name investors share their thoughts, beginning with tom wagner. erik: how would you describe your state of patience? are your limited partners giving you the breathing space you need, or d feel like there is a fire under your behind and you have to invest? >> the only time we feel pressured to invest is when you see the broad credit markets trading at high yields. erik: like january or february. >> like january or february. you want to know the nature of the risk. at any other point in time, investors know we are able to find interesting investments. they are comfortable with us being patient. like are point in time, present, where you have to rely on a level of patience to wait for the next great opportunity. ♪ erik: is it getting harder to find companies that neither kind of work you do? is there last low hanging fruit that it used to be? >> we are always searching for companies. before all of the companies we are looking for, even though we have grown, hour before leo was roughly the same size. we are looking for the same or similar numbers of new companies, new lead positions each year. is three to seven new lead investments. it is not a huge number. i would say on the one hand, you may say it may be harder to find them. on the other, for us, i do not think that is true. not only are we looking for those ideas, other shareholders are looking for those ideas for us. and they are calling us. they will call us with ideas they think are undervalued. our final sometimes gets bigger because, as we have grown a following of people who appreciate what we are doing because we have been looking out for the best interest for the shareholders, people will call and ask to get involved. ♪ ♪ matt: you are watching "bloomberg best." i'm matt miller. the week in earnings. some big beats and strenuous spin, starting with t-mobile's john ledger. >> shares of t-mobile u.s. are rising. --e company managed to lure managed to lure new custom subdivisions wereers. -- >> this quarter was fantastic to 2 million net customers. that is 14 quarters in a row over one million at an average of 1.9. we had 851 million postpaid phones. for000 prepaid phones $3001. -- $38.01. an adjusted down growth of 38%. ever since at&t bought directv, they have not gained a single postpaid customer. they are their biggest contributor to our success. i can only say in the short-term, this distract him -- distraction with them trying to take over the entertainment industry will be a boon short-term for t-mobile's growth. >> breaking news from philips. revenue coming out five point 9 billion euros. shares at philips have up against 11% this year. third-quarter sales, 5.9 billion. costs,re we in terms of giving it guidance on those lines? >> the last few years, we have transformed philips and separated away from the health technology activities. once may, we are focused deriving health care solutions into the market, helping customers get better patient outcomes at better cost. webeing a focused company, are able to further streamline our internal operations. with the growing top line, because we have 5% revenue growth in the quarter, and a margin expansion, we were able to generate a lot of net income and cash flow. earnings.ay for auto gm and fiat chrysler beat estimates. out, was said. then the numbers came out. >> gm had a record quarter. it was driven by business in north america, where we expect sales to plateau. ford has been saying that. but gm has focused on retail sales to individual customers and dial down low profit sales. >> fiat chrysler, i thought that fiat was saving chrysler, but it seems cheap is saving fiat. roleere is really a reversal. yet chrysler gets most of its earnings from north america, mostly from jeep. now the ceo is saying for the year, for yet chrysler will make $6.3 billion. he is increasing his estimates based on the strength of mostly jeep. hughes reporting a loss this quarter. this bite ca activity modestly increasing. i think opec cap under in the story for them. are we getting too excited in the short-term? >> it is tough to say overall. but right now what we are seeing is in some parts of the world, service companies all seem to be talking about it. for sure in north america, we are seeing talk about the bottom. at least baker hughes is saying for north america to look at slight activity increases the best -- rest of the year. >> shares are down almost 1% after eli letting missed estimates. are you disappointed with the result, even if the market is on the margin? >> we are not disappointed. $.88 per share. we have kept guidance for the year at 350 to 360. we are marginally increased revenue. stopped guiding for the quarter many years ago. we certainly do not manage our business to meet a consensus estimate. clearly, we are pleased with our performance. it includes 7% growth. to our that attributable new product launches. tech as ae to reduce percent of sales, consistent with the medium-term guidance provided to investors. . corporate sales grew thanks to perception drugs, but the biggest issue remains its purchase of monsanto. many remain skeptical. the monsanto share price is pricing in a lot of bigger toll rate risk. are you surprised, and when will you start talking to regulators? where are we with the process? >> we have been in preliminary discussion. prior to us signing the transaction, we also have in-depth talks and monsanto has product overng the leveraging. we think this is a manageable risk. confident that we can resolve any issue that may overlaps. product shares climbing after reporting earnings that beat analyst estimates. its third-quarter was reportedly helped by sales of smaller, more profitable package sizes. our organic growth and profit margins the things that strike you most out of your? >> earnings absolutely. >>we are ongoing -- while we are change, the company is continuing to grow across the world. it is a good, solid quarter. >> twitter earnings be estimates. the company says it plans to cut 9% of the workforce to meet any profitability role. the question is are they cleaning it up or are they making a company to actually run it themselves? entertain they would an offer above the ipo price, but i do not think they are doing anything at the direction of a proposed potential acquirer. they clearly intend to be profitable on a cap faces. i think they would like to exit 2017 in a profitable state. i think they are taking the steps they should have taken three or four quarters ago. bit shares are higher in extended trading after posting third-quarter sales and profits that eat analyst estimates. google made up for its unprofitable moonshot and new hardware decision. one of the -- what are the biggest highlights when it comes to core business and the ad business? >> there are expectations that growth would not have been as robust as what was reported. so it was a strong number. the growth in the core google website. aroundt expect it was 300 to 400 basis points. so it read estimates on eps. they announced a share buyback of roughly over 7 billion. overall, it was a solid quarter. stock you want to continue to own. dimon shares sell as much as 5% after missed estimates are increased spending and how they could not make a dime in holiday sales. going back to what we remember with amazon, the fact that they sometimes did not deliver a profit. will investor start swallowing no profit again? >> i think you will have some investors worried about profit again. the holiday season is a big time for amazon, and here you have them saying we may make no money at all in the fourth quarter. there is a big range between zero and 1.2 $5 billion. but analysts are looking for more than that. they certainly will not be happy if it ends up being closer to zero, which they are saying it might be. there were also surprised by the slowdown in profits in the current quarter. this is not a good picture for amazon. ♪ ♪ this is a scattergram, wordsworth on useless in statistics but found value in bloomberg's terminal. us left to right, on the left side, stocks down for the day. on the right side, stock up on the day. the market cap. the color shows the five-day move. matt: there are about 35 thousand functions on the bloomberg. we always enjoyed showing you our favorites. maybe they will become your favorites. here is another function. quick go. intoll give you insight timely topics. here's a quick take from this week. a failed military coup in keepy is being used to our. for turks, revolt is nothing new. in country experienced coups 1980 and 1997, when the prime minister stepped down under pressure from the military. it again has been pressured -- byogan has been pressured the military, academics, and other officials. the latest highlights is a division tearing the country apart. here is the situation. turkey's political identity echoes its geography, straddling the most in europe. a nation where east meets west. turkey led of modern in 1923.n since then, the turkish armed forces have played a central role in retaining the secular western-looking society. the ak party was first elected in 2002, with her to one -- molding turkey back into it and islamic world power. many turks love him. the size of the economy nearly tripled in a decade. but over the last few years, he stifled political debate, fighting accusations of corruption. in 2014, he began purging the judiciary, detaining journalists, and trying to control the incident. he says those responsible for the latest to attend our followers of an exile in the u.s. who became a critic of erdogan's government. gan is not being shy about his ambitions, building a more than 100 room palace. a context30 side -- 30 times larger than the white house. been denouncedas for being autocratic, he is still admired. rulers turkey's longest political stability since world war ii. years, the turkish people have been divided on what they think about the man in charge. turkey has been a member of nato since 1952, but has not been able to join the e.u., which is critical on the country's lack of democratic reform. erdogan does not look like he plans to leave anytime soon. ♪ was just one of the many quick takes you can find on the bloomberg. you can also find them on bloomberg.com, along with all the latest business news and analysis 24 hours a day. that will be all for "bloomberg best." this week. thanks for watching. i am matt miller. this is bloomberg. ♪ >> we are starting to like this? >> i don't know. -- >> people seem to blame goldman for the sins of wall street more than they blamed anything else. could this be life-threatening? >> it is life-threatening for sure. >> do you think maybe i should step down and smell the flowers

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