Editorinchief of bloomberg businessweek. In the business section you take a look of a chinese company. A large variety of further clothing. Feather clothing. Manufacturer in china of this kind of apparel. It epitomizes so much of chinese struggle, this is a brand that they wanted to take global, these codes are very popular now coats are very popular now. People are seizing on this. This is a brand that you would think would be a hot item, fashion forward, manufacturing. It has struggled to capture that and globalized the business. What epitomizes is the struggle but so Many Chinese Companies have where they have access to markets in asia and the u. S. But does not have the cache of western brands and 10 i did a line of massmarket appeal. Cannot get over the line of massmarket appeal. Oliver lets talk about another Asian Company which is forever sothebys. Lets talk about samsung, the korean company. Although be Different Things that should have hindered his company, it continues to go forward and to be a brand. The remarkable resilience of samsung. We want to tell this story in business week for a long time. Pete rouse and tribulations from exploding phones to a collection with their founder the browsing tribulations from exploding phones to the trials and tribulations from exploding phones to trial with their founder. It is the same way that america views walmart, mcdonalds, other barometers of the economy. The company that has faced unbelievable, a phone that literally caught on fire and was banned on airplanes. Your own founders seem in handcuffs and shackles going to everyday. Still record profits. Carol we get more on the highs and lows at samsung. Samsung is a company that has been around for a long time but it has been through some trying times. Set the background. Read financially, the company has never been doing better. The most profitable in the world, overtaking info. Intel. It is enveloped in a political and legal drama in its own country, south korea. Just a little background on what samsung is because we attribute it to its electronics arm, but the Samsung Group is an informal affiliation of 60 companies. There is a founding family, the li family. The grandson of the founder is in prison in south korea and on trial for allegedly from embezzlement allegedly corrupt from and embezzlement. A scandal corruption and embezzlement. His gamble that led to the ouster of the prime minister. What it reflects is the ambivalence or at least a sentiment around these Large Companies and south korea. They were really affiliated with the companies, the enormous successful Economic Growth over the last 50 years. Now they are viewed it little more dimly. Samsung being the most visible, the Largest Company in south korea is in the middle of that. Carol the success of samsung has been important to south korea, correct . Not just samsung. But samsung, the 20 years since it has emerged, there is a lot of pride in the success of this company. Samsung electronics, it was associated with appliances in our home. Some lowquality phones in the early 90s and now, right next to apple as the largest maker of smartphones and connected devices in our lives. That is the visible part. The invisible part is that they have an enormously successful semiconductor business. We visited a Semiconductor Plant south of seoul. You cannot imagine the scale at which they operate. They have Broken Ground and gotten operational in this facility in the span of two years. The digs into all 35 years or longer to get a fabrication plant up it takes intel 35 years or longer to get a fabrication plant up. It is unrivaled. They have managed to time these plans to coincide with upswings in the technology sector, that is one major reason why samsung has been so quietly successful over the last 10 years. Carol i like that who started out the segment saying good and bad times for samsung. Financially they are firing on all cylinders. But you mentioned the grandson is in jail. Talk about that because that is a bad time. Brad that is not a good look. What some people are saying is not only that he is on trial, and look, his father also went through a similar experience. In fact, many of the leaders most often end up periodically imprisoned in south korea for whatever reason. It is reflected in the conflicted relationship the country and government have with Large Companies. What is different this time is that the country and even the media is so pro samsung in the past and are now celebrating the idea of this luminary in grounded. You go to south korea and you see this photo every day of him in handcuffs. They are exulting in his humiliation. The cases monstrously complicated but basically he is being accused of engineering a merger between two samsung companies to strengthen his hold on the Samsung Group and in particular samsung electronics. Whether he did that or not is beside the point. There is been an unspoken agreement between the Big Companies and the government to facilitate their success. Suddenly it is knocking the contract, they are under siege. Carol generations have been running this company. You talk about the family. Is it possibly time for somebody else and not the li family to be running samsung . That the culture needs to change . Brad that is a good question. You talk to shareholder activists like a hedge fund in new york which has lobbied for changes at samsung over the years, they would say yes. This is archaic Management Structure that other investors in the Samsung Company have their rights reduced because of the powers of the family. It is certainly not a modern Management Structure. But at the same time, you have to look at the success of the company. And the investments like pyongtech. The are only possible because of his unorthodox and anachronistic management style. This unorthodox and anachronistic management style. The family is comfortable in leadership and make longterm bets. You will get Japanese Semiconductor companies, look at Japanese Semiconductor companies, they have faded. They were not able to make longterm bets in the future of technology. You have to give the li family, this founding family some credit. Carol turning a samsungs success to recover image was a job. Into a cover image was a drop. Job. Oliver how did you go about this . Reading the story, it is about how much they went through, this wide range of things from corruption, this was hard to portray a name literal sense so we went through a metaphorical sense. Carol samsung is a huge company. It has been around for a couple of generations. It is a familyowned company. But you mentioned, it produces so many Different Things but the following is the most iconic things. They associate them with the exploding phone. Oliver november a lot of things happening to it you have a lot of things happening to it. Did you brainstorm many different ways you could attribute this up . The director was on set and the studio got excited when you put it on fire. Anytime you can like something on fire, do it. Oliver this is not post. This is a phone lit on fire. We definitely wanted the phone to be on to show that despite the things happening to it, it is still functioning. Oliver that is at the end of the day, all of these things to happen. Carol up next, have turkey and germany reached a breaking point in the relationship . Oliver President Trump accused of reneging on his promise to the petrol industry. Mark this is bloomberg businessweek. Carol this is bloomberg businessweek. Carol welcome back to bloomberg businessweek. Oliver you can find us online at businessweek. Com. Carol in the politics section, once friends and now frenemies. The relationship between germany and turkey. Oliver Neither Company can go too far. Germany and turkey have had long and deep ties. Tell me how long and how deep. The trade between the two is upwards of 36 billion a year. The relationship goes back to the 1960s when a lot of turks moved to germany for worker shortages. But matt, there have been tensions for about a year and a half that in the last week spillover over human rights spilled over, over human rights, mostly. Carol i had no idea of the is was. Once of German Companies operating in turkey, a lot of workers, backandforth. Correct. Deutsche bank, siemens, volkswagen. The biggest companies, German Companies in the world have a huge presence in turkey. Germans for a long time made of the biggest tourist block in turkey. And turks are one of germanys biggest ethnic minorities. The ties are complex and deep and substantial. Carol we know they have had a great relationship. It has become strained. So last week, turkey detained a few human rights workers, including a german national. Angela merkel, the chancellor, uncharacteristically denounced this. The last year and a half, she has been treading very likely on turkeys detentions of journalists and whatnot because of a deal that she brokered last year in which turkey agreed to accept a lot of refugees coming out of syria. So that has caused her to want to not offend, lets say, turkey, who she relies on as a partner to keep these refugees out of germany. Oliver and the politics section, donald trump is a candidate spent a lot of time as a candidate spent a lot of time trying to creamy favor of to curry the favor of the ethanol industry. Carol that has changed in the white house. Oliver youre looking at alternatives to traditional energy. Tell us where some of these people in midwestern areas of the u. S. Are thinking about the future right now and what it means . Is a mixed bag right now. The future looks brighter for them about 12 years ago when the renewable fuel standard was instituted under president george w. Bush. Now, under the trump administration, it appears to be a mixed bag. We had our first referendum on where he may stand and how he may kind of administer the program earlier this month when he proposed value targets refiners have to use for next year. Carol renewable fuel standards put into effect of years ago by president george w. Bush. What did it require . It required escalating amounts of fuels to be mixed into the u. S. Fuel supply if you will. We are talking ethanol, biodiesel, etc. The objective of the program at the time was to reduce foreign sources of oil and also to address climate and environmental issues. Oliver there are a lot of countries where ethanol is a big export and comes from corn, but in the u. S. There are certain areas were a lot of that corn farming is done and that ethanol gets made. That gets to the courts of this story crux of this story. Tell us who those people are and where they are in the u. S. In the u. S. , the industry is very, extremely concentrated in the u. S. Were talking about iowa, illinois, indiana, nebraska, etc. Of course, when we mentioned iowa, but is also, you know, i Battle Ground for president ial aspirations a battleground for president ial administrations. Carol what is up with washingtons diversity problem. Oliver brokers. Carol this is bloomberg businessweek. Oliver welcome back to bloomberg businessweek. Carol you can listen to us on the radio on sirius fm channel 119. And in new york. And in boston. A. M. 960 in the bay area. Oliver in asia on the Bloomberg Radio plus app. In the front at section, wall streets top bosses have pledged four years to bring diversity for years to bring diversity to the workplace. Carol the opposite has happened. Tell us about the backdrop. Working to have a more diverse workforce, men, women, minorities, what is going on . Max a very simple way to describe it is that things are not going good for diversity. I tried to write about this years ago, i mightve talk to you about it. Editor, our editor, we had no idea about talking about lack of diversity on wall street. We never really ended up finding the perfect story. It had five main characters because it is hard to tell such a complicated narrative through one person. On hold for a while that a couple of weeks ago, robert, my editor said lets go update the diversity numbers you collected. I did and i was honestly surprised me to a look at the most recent numbers. Which for most banks is 2016. The numbers for black diversity, not great to begin with, were down at a couple of the biggest banks in the u. S. Carol the big bank, what are we talking about . Jpmorgan . Wells fargo, bank of america. Carol all of the big banks. These banks have come out publicly, a fair amount of them, and said that we want to have a more diverse workforce. Jordan all of them have made public pledges. We all have diversity pages on their websites touting the idea that they are looking for a diverse and inclusive workforce. But like the davis euros, the data shows, those are not living up to the workforce advocate, not on par with their industry at times, it is lagging. Oliver america, by and large, is Getting Better at these problems. Not everyone, this is something that your name i have been talking about, media is pretty white. So, we have a line in the story about the information industry which includes silicon valley, parts of the media, hollywood, those numbers are not great too. What is so interesting and eyeopening for me as i was reporting the story is that black diversity in Corporate America is going up. If you look at most of the country, countries with at least 100 employees basically, not only is black diversity going up among the whole u. S. Workforce, which, by the way, is what were talking about here. Workforce of the six largest banks in the u. S. Black diversity is going down at those banks while it is going up in Corporate America, executive and workforce out lo at large. Carol how do we explain what is going on . Jordan we have a line in the story that there is no one a commission. Academics and bankers offered multiple reasons why these numbers are not working out of the ways we expected them. Some of them stated of a lack of creativity and really bringing in young black hires. Some say its not even caring enough, some of the focus goes to gender diversity and other efforts to boost minority numbers. Not enough effort. Carol to be fair, any of the firms, goldman sachs, and the of the rest . Jordan wells fargo really stuck out to us when we look at their executive suite and their total workforce. The numbers for executive at least were rising 2 , 4 , 6 . I think it went up to 12 for the workforce of africanamericans. Those numbers really stood out because it was really incremental and the other rights, either going in the other banks, either going up or down. Carol investors. Are increasingly shifting to online to online advice. Oliver phone providers are still paying for junkets. This is just to remind everybody for those who might not know what they are, they are continuing to grow. There almost a decade old is a phenomenon. As a phenomenon. Taking in funds using a logarithm and putting them in the appropriate bucket. Oliver basically taking input on what investors are comfortable with. What kind of return they want. Essentially taking the mutual funds or indexes across asset classes. Then we gauge how much money they make, all of the things you would want to go to figure out how much risk is appropriate for you. This is what we are talking about. Either retirement, these are average people in many senses, as well as casual investors looking for some kind of return. People who cannot afford a full price financial advisor. Carol its cheaper. Much cheaper. Oliver that brings us to the topic of who is in charge. Who offers those as products. Where are those big shots . Shops . Schwab and vanguard have taken it. They are the manufacturers of these products, taking together the logarithm. Immediately who bring up assets. Hoovering up assets. What brings us today, the big brokerages like Morgan Stanleys and wells fargos of the world, they have all recognized that they need to have this channel. Ultimately, all of the people with money will die out, their kids will get the money, kids are more used to direct Digital Channels rather than dealing with. Dealing with people. Dealing with people in front of the mahogany table. They know they need to create this channel. Thats where they are doing thats what theyre doing. They are creating their own roble advisers today. Oliver up next, what is behind highperforming stocks . Carol the mysterious hijacking of a 100 million oil tanker. Oliver welcome back to bloomberg businessweek. Carol the showdown of fivestar megahotels in london. Oliver all of that of ahead in up ahead in bloomberg businessweek. Oliver were back with bloomberg businessweek. Editorinchief. With go to the finance section, a story. Tell us about this from gary and company. Hungarian company. It is a big one, only sales of 900,000. What this story talks about is how this stock has rocketed based on association with hungrys prime minister, who has been incredibly controversial in what he has done. Everybody knows that hungry developed quite rapidly after the fall of the berlin wall along with so many other Eastern European economies but since the president has been in power, he has centralized authority, bolstered the resiliency in terms of lack of reliance on imf funding but also attracting controversy for centralizing control. He is suspected of enriching his friends close to him, and one of them is the owner. Oliver an incredible story in the futures section that we want to talk about, the hijacking. Carol it is a movie, almost. Oliver you cannot read it without thinking about the movie. Even if you have not seen it, the narrative is awesome. Megan what is so fascinating about this is that it should say light on two things, sheds a light onto things, piracy and the lack of transparency in this market. This was a hijacking with a hundred million payout and murky connections between what we see all the treacherous high seas and what can be connected to somebody making a mark on a fountain pen in london to ensure a wide chain to connect. I think when we told this story, we got to the heart of it, talking about human lives on the ship