softbank's ceo told donald trump that he would invest in the united states. a came from a previously announced tech fund. softbank hopes the new administration will look again at its merger with t-mobile. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. check of the markets. afternoon trading getting underway in hong kong. asian stocks are rising, sending rally to a second day. this is bloomberg. ♪ emily: this is "bloomberg technology." $50 billion of two great 50,000 u.s. jobs. create 50,000 u.s. jobs. that is a tweet from donald trump . a hypothetical trade war with beijing. responds instagram with new hate speech filters. talk was productive according to donald trump between himself and softbank. to trump: he has just agreed $50 million and create 50,000 u.s. drops -- jobs. it could be good for business and also good for sprint. member, softbank is the parent company of sprint. they have long wanted to merge with t-mobile. donald sight to see with hisund the -- arms around the softbank a ceo. you have to remember both of these guys are opportunistic and keenly aware of the optics of something like this. in a sense, it is not a surprise. the ceo had already announced this fund and he needed a place to invest and the u.s. was going to be part of that. the election of donald trump and the fact that the ceo has interest in the u.s. that though beyond just -- go beyond just investing in the fund take this a perfect kind of opportunity for him to fly over to new york, sit down with donald trump and to a photo op. tweeted,nald trump "softbank has agreed to invest $50 billion in the u.s. and create 50,000- jobs. he says he never would have done this if we had not won the election. what do you think this means for a potential sprint and t-mobile merger? is he buying his way to that? reed: a cynic would say for sure. obviously a merger is something he is wanted for a very long time. donald trumpmoment took the lead on november 8, this popped into his mind, i have got to get to the states and make a big splash and i have to get in early and get the ear of the next president of the united states. wasuse as he said, this like a great opportunity to go in and, on the ground, really, and possibly influence regulatory issues. emily: an interesting turn of events. we will be watching to see if other business leaders, other global business leaders follow. reed stevenson there in tokyo with us. still to come, we will tell you about the tech industry's role in the world's worst case scenario. in a reminder, all our episodes are live streaming on twitter. this is bloomberg. ♪ emily: now to our worst-case scenario guide to 2017. here's the back story. last your, we published a think piece about what the world would look like if economists and diplomats greatest concerns came to be in 2016. in it, we suggested the u.k. could leave the eu, anti-immigration would rise and --ald trump would when the win the white house. all came true. next, china and the u.s. going to economic war. donald trump flouted the policy by taking a phone call from taiwan. it could not be set -- it might not be such a small possibility. scott, think you for joining us. how likely do you think a trade war is and what would the real impact be? scott: i think the likelihood of a trade war started by a nuclear weapon like trade currency is pretty low but a trade war started with buckshot with smaller measures is certainly possible and donald trump could roll those out soon after coming into office. emily: take a listen to what said about chen this. anybody -- what do i know? if you want to be logical, you want to be a business person, you look at the well-being of everybody, including your own people. any trade war in a globalized system, it is absolutely devastating, to say the least. it would put the whole world into a recession that would probably be very hard to get out of your -- out of. emily: who does the trade war hurt more? both countries and everyone in the supply chain would hurt as a result of a trade work but i think the intention is to rebalance the relationship to get a little more reciprocity in the relationship and open up chinese markets for imports and foreign investments more. you can get into a trade war easily but it is hard to get out of one. emily: let's take a listen to some of the tweets donald trump has done over the last week. talking about the call from the president of taiwan, he emphasized that the president called him. "interesting how the u.s. sells dollars inn equipment but i can't accept a call." also, "did china ask permission to devalue their own currency, put theur imports or military in the south china sea? " how do you think the chinese are actually likely to respond? i think right now they are back on their heels and a little bit nervous and wondering what this deal maker is going to be like. they are going to wait to see. on the case of taiwan, i think we should look and see what they do with foxconn in other parts of the relationship. it is obviously important. china does not want a trade war, either. i think right now both sides are dancing around the ring and getting ready to square off, and what donald trump has done in the last few days basically put the chinese on guard that more is coming down the pike. emily: taiwan plays a critical role in the supply chain when it comes to the making of the iphone, for example, and so many other electronics. how could this be affected? the actual supply chain, if indeed there is an economic war of sorts. could it easily dragged into a trade war between the u.s. and china because of sentiments that have recently been express. i think the canary in the mine would be foxconn. they are from taiwan, the longest -- largest employer on mainline china -- mainland china. if foxconn runs into problems, a lot of benefits they currently get from the chinese government, if they run into problems, we know others in the supply chain like apple and others would face difficulties, as well. emily: if foxconn ran into problems, where else could apple go? this is the company that assembles the iphone. scott: in the short term am a they would be stuck. they would have to figure out a way to solve it over the long-term. everyone in the supply chain is connected to china in some way because, one, china has low cost, labor excellent logistics for the global market, and because of all the consumers in china. it would be a big adjustment. i suppose if they thought it would be a long-term coughlin -- conflict, they would. emily: any idea how other companies are positioning themselves right now, given a donald trump victory? i think most companies are positioning themselves under the table making sure they don't get caught in the crossfire's of a trade war. they're not overly criticizing trump or the chinese. they want to make sure that if they come to blows that there business interests -- their business interests are protected. emily: or that they are creating 50,000 jobs in the united states. thank you so much for stopping by. coming up, tech ipos had a hard year, but is the market primed for a comeback? we will discuss, next. this is bloomberg. ♪ emily: the 2016 ipo market has been weak at best. it was the slowest year for ipos since the recession and tech listings are no exception. only 25 companies went public this year according to bloomberg data. compare that to the $8.3 billion raised in 2015. there were some bright spots. companies that went public traded two thirds higher than their initial sales price, signaling for some a more promising year to come. joining us for the ipo for coast -- forecast is jackie kelly. thank you for joining us. factors and political have been weighing on the confidence around ipos. what are you seeing when it comes to 2017? jackie: i think we went into this year expecting it to be slow as we had headwinds from a variety of market factors. that said, what we have been doing over the past year is working with companies planning for ipo's starting as early as first quarter 2017 good -- 2017. technology is great for that, especially unicorns. emily: i had an investor tell me today we don't like unicorns. because if they don't sell, they have to go public and companies are not going public. do you see more unicorns actually taking the plunge? jackie: absolutely. they are all working on it. there has been a lot of focus on unicorns over the years because they are brand names in our household. theirave been building processes and infrastructures and we have been behind-the-scenes working with many of them. we will see some of them come out next year and over the next several years. emily: what about uber and airbnb? are they going to feel the pressure or are they going to stick to their own timeline? jackie: i don't think they feel pressure to necessarily go out because the market is excited. i think they're doing the right things. they have great people around them helping them to assess the business. emily: what about when it comes general, techs in has underperformed compared to the rest of the market. as tech iposr relative to the market in general, tech ipos are outperforming the market. even though we have not had as many of them, their performance has been great this year, which lays a strong foundation for 2017. emily: what about tech stocks overall? ofkie: i think each one these companies is so unique and it will be valued individually. household names, again. i think it will be a positive response when these company's come out. emily: do you think going public is a smart decision? we seeing two thirds of companies trading above their sales price, to what extent varies. do you think going public is indeed the right decision? jackie: every company is making its independent decision to ipo now or later, or for some, whether they say private. the good news is that many of these companies have had access to a lot of private capital over the last several years so they have been able to grow and mature and take risks. i think many of them are ready to be visible. being public need you can compete for talent at different levels and provide incentives to your employees. they do have credibility that you may be did not have before. there are lots of benefits to going public. there is a right time to do it. emily: does trump change much? wille: i think his policy affect things. companies are looking at how the policy will affect them. we are seeing it in the market. some people are very excited about what potential policy changes will do to their sector. every sector is very interested in this. we are looking at financials and energy and real estate. some are getting really energized. we are going to see a lot of great sectors in 2017. emily: jackie kelly, thank you so much. the latest episode of "bloomberg's hello world" goes inside russia, where there is a new generation of world-class tech companies. among them, a next level facial recognition app. each year, russians build an app that rewires our social fabric. of human history, when you stepped into a park like this, strolling around and enjoying the day, you have been in public but day, you have been in public but unknown. lost in a stream of friendly faces until now. >> would you mind if i took a photo of your face? i'm going to try to do an experiment. you?n i take a photo of we will see if it will find you. >> you might find me on facebook. >> it does not work on facebook yet. >> it is an android app that let you take a picture of a new friend or a complete stranger. in a few seconds, it scans all themillion photos from russian facebook knockoff and finds a match. >> let's see what happens. >> it is me. >> it is me. >> your hair is so different. [laughter] >> it works. it is really cool. >> do you think it is strange? >> strange for cool. >> you take a photo and then you can find you. [laughter] if i forgot this was my son or not, i can check it. this year, they're taking the algorithm to america for some thing called the mega face challenge. there is a lot of face putting software. -- spotting software. it, id out how they did went to the -- meet the owner. >> these are my russian brethren. is it ranked in order by who they think looks the most like me? >> yes. >> another guy with a gun. why am i a bear? [laughter] --metimes you look through >> they programmed a neural network that approaches face finding differently. imaged it thousands of matches and after six months of training, and learned to read faces. find the exact person in huge data sets, it opens the door. >> are we creeped out yet? maybe we should be. they have already signed a contract with the moscow city police, although he will not talk about it. haveys they also agreements for other law enforcement agencies both inside and outside of russia. it is easy to imagine what the could do with this kind of technology. it is a little bit controversial because anyone can identify you. >> yes. >> i would say the implications are very scary. >> you have to be careful if you're going outside on the street or on facebook or another social network. you are open to be recognized. this idea that you are not anonymous when you walk the street anymore, someone can just snap your photo and identify who you are, you must have thought about that when you were developing the technology. smartphones can track all of the information about you. i think technology will win. emily: coming up, old-school retail meets new school e-commerce. and if you like bloomberg news, check us out on the radio. you can listen on the bloomberg radio act, at our website. this is bloomberg. the aussie dollar fell after the economy contracted more than expected last quarter. than half of 1% from the previous period as government that -- spending fell and imports rose. that is the fourth contraction since the financial contrast -- crisis in 2008. the woman at the center of korea's undue influence scandal has refused to appear before lawmakers. security officers went to find her, but she declined to obey. -- she said she would accept the outcome of an impeachment vote on friday. donald trump is said to have chosen his ambassador to china. he is often supposed to i was governor. iowa's a long time -- governor. trump flouted decades of protocol this week by calling the president of taiwan. -- shares jumping and tight -- after seeing record losses. the stock has rallied 21% this month alone. its taiwanese parent says it is in preliminary talks to expand operations in the united states. global news 24 hours a day, powered by more than 2600 journalists and analysts in more than 120 countries. this is bloomberg. let's get a check on how markets have been trading in the asia-pacific. here is juliet. >> the rally continuing in asia for a second consecutive session. a lot of focus on the meeting later this week. a lot of speculation that they could push out its bond by the deadline. we have seen some positive buying coming to the region. australia closing higher. we saw that third-quarter gdp. most equity stocks are looking very strong today. hong kong also having a very good session. hanjin is trading higher. most of the banks are driving the rally in hong kong. at theire trading highest level in 16 months. also in shanghai, positive territory, up by a third of 1% after a bit of a negative start for the trading day. , -- and we will be live from london at the top of the hour. this is bloomberg. ♪ emily: this is "bloomberg technology." neiman marcus facing an industrywide slowdown in department store traffic is partnering with the runway. feetwill add 3000 square on the floor of a san francisco location and ran to expand the partnership further. the space will feature a rotating selection of clothes and accessories that shoppers can rent along with a selection shoppers can buy. they are opening a new flagship store in new york city. discuss, ceore to of rent the runway and ceo of neiman marcus. feetis a 3000 square store. it is huge. how does this partnership work for the customer? our millennial customer, the thing she values most is her own time. convenience is the new luxury. we wanted her to have a one-stop shop where she comes into the store, she can rent all of the outfits she needs for all of her upcoming occasions, by the shoes and make up. everything is cross merchandised together. there is technology we are using inside the store so that we are working as partners to try to cater to the customer first. emily: karen, how does it work with the business side? most: i think the important thing we are sharing into the customer is come a what she is looking for when she comes to rent a dress and comes to neiman marcus to pick it up or return it. we are at our first test and we will see how it goes. emily: if they are renting and not buying, doesn't that take a bite out of potential revenue? karen: we don't see it that way. our goal in this partnership with rent the runway was to get to know this young, fashion conscious customer and to know what her needs are. particle we are trying to do is attract the next generation of shoppers to neiman marcus. we believe that when she is coming in and engaging with our team at rent the runway and our human -- neiman marcus team, we're going to learn a lot. emily: you've told me that 60% of the closet be in the cloud some days. i wonder if you disagree on this point, do you think 50% of your closet will be in the cloud? now, 50% ofght women 40 and below go toward fast fashion off-price. 50% is going in to investing in and overou where over again. i see renting as a substitution for the items in your closet that you only where once or twice anyway. you're substituting it with high-quality, designer merchandise at you control how long you need it. emily: the average age of your customer is 29. for neiman marcus, it is 51. how do you think neiman marcus will evolve? karen: we think there is always room and women's closets for a beautiful, luxury product. we have to run for the shared economy and not a way from it and figure out how it fits together into the total shopping experience. ,mily: changing demographics wanting to be able to serve your traditional customers, how do you evolve? i think this is one task where we try to understand where the millennial customer wants to shop in the future, how she wants to engage with neiman marcus, what she wants to buy and what she was to take from the sheer economy. i think our core customer is learning differently how she can shape her closet. i think this will be a good test for all of us to learn how things are changing. jennifer: year-over-year, the importance of black friday and cyber monday have been decreasing across the board. one of the their i have is that in a world with amazon prime, , where youan uber don't have to plan how you're going the dinner that night, that the idea that you will plan your christmas gifts three weeks in advance, to a younger customer it seems very archaic. one of the things we have launched a neiman marcus is to have a last-minute rental. you to be at work, so that you can text a stylist at the store and she can get the inventory to your office. it is like using the store almost as a warehouse the cater to your needs as a professional, busy woman. we want you to get the rental apparel but also the shoes and etc., and that is why we wanted to pair with neiman marcus. tried similarhave things. how do you balance experimenting with not taking too big a risk? toen: it is nice to be able update some of the before you figure out what the long-term relationship will be. we are excited about this. i think in a few months we will have a good sense of whether we are able to go deep into something much more transformational with rent the runway. we are not in the business of selling close. we're certainly not in the business of selling been -- brand-new clothes. the only way you can buy it is going to be to purchase it. we are not detrimental price and the some way that some of the other folks are. and we are not offering a new way to sell clothes. emily: karen, what are your expectations for the holidays given the shifting behavior when it comes to millennials and your traditional customer? there is no question that customers are doing more shopping online, that has been an ongoing trend. there has -- they are being more deliberate when they come into the store because they are doing a tremendous amount of research before they step in. forink they're looking unique, interesting gifts or things they want to self purchase. toiously, we are all having think about these transformational changes happening in our business. ceo of neiman marcus and ceo of a rent the runway, thank you both so much for joining us. , $26 billion to purchase lincoln has been approved. theosoft plans not to tie linkedin network to its software. first -- force was outbid. a presse released release saying that the antitrust authority should be aware of this. on thew, bill emerson future of the housing market at 9:00 a.m. new york time. --ing up, bloomberg may have this is bloomberg. ♪ emily: it is no secret that tech engineers and employees with coding skills are in high demand, and with that demand, profit -- but some graduates are finding themselves in debt and .nprepared for tech jobs they feel duped by their educational institutions. the regulator that oversees coding in california has find schools-- fined including one called coding house. they have appealed. we have this full story at bloomberg.com. airbnb is working with industry officials to build up its business in china. they teamed up with for chinese cities to allow the service in hotspots. staring --o started storing information relevant to them. while working with the company's regulators will help them, the question remains, can they compete against chinese home sharing market? joining me from hong kong, lulu chen. how airbnbctly about has been quietly plotting its strategy in china and striking deals with the chinese government. they have been pretty patient in terms of expansion in china. not like uber, where they rushed in. in terms of what airbnb is doing, they're looking for a ceo in the country. remember last year around july, we were talking about this topic. they have been a pretty patient about finding the right talent. there the bigger steps is going to store their data locally in china, which is part of complying with local regulations on the ground. apart from the regulation hurdles, they will be facing competitors. we have reported they have been in talks with them. there is a lot they have to face in such a large market. that: your reporting shows one of the companies has a 1% occupancy rate. what does that say about them there inuch demand is china for the services airbnb provides? seems like a really low figure, and that probably explains why commission rates were down. the best-performing quarter was only $2 million. it is an industrywide phenomenon rather than a company specific challenge. if you look at beijing and shanghai, they are doing pretty airbnb isthere -- established in those cities. second tier cities and tourist destinations, a lot of catching up to do. it does not mean that this will be an easy competitor, because the company has a lot of backing from some of the -- country's largest internet companies. emily: airbnb is taking a different strategy than uber did. are the chances of success any different? we have talked to so many pessimists who know the china market very well who say airbnb is unlikely to succeed just as so many other u.s. companies have failed. it will be challenging for them if they go in organically. finding a local partner, which seems to be their strategy, and possibly collaborating with a competitor is one of the options. they won't have such hurdles with regulatory requirements. reporting fromn hong kong. thank you so much for the update. aogle expects to release major milestone in the year, running the company entirely with wind and solar. they are been pursuing this goal since 2012. fall inays the dramatic solar prices has accelerated the program. strategyhead of energy was asked if there is a shift in the way that renewable energy is funded in the u.s. over the next four years. >> we were excited that the administration is interested in funding all energy, including renewables. any result of any election doesn't change our corporate values. we will be pursuing this aggressively in the future. emily: tesla announced it is voluntarily recalling adapters for electric vehicle trying -- charging. there were two instances of overheating which resulted in multicast it on the adapter. 1430 adapters that are sometimes used to charge the goals. -- tesla vehicles. it is sold through the company's online store. replaces hints -- replacements will be served -- shipped in the next few minutes -- weeks. emily: we will dig into instagram's new features. this is bloomberg. ♪ emily: now to a story we are watching. the supreme court told a lower court to consider reducing a $399 million award one by apple from rival samsung. accusing samsung of copying the iphone. the judge said samsung may not theequired to pay all of profits it earned because it only copied part of the devices. the unanimous decision is part of the legal battle that dates back to 2011 and it was monumental when the initial verdict came in. we will continue to watch. there are -- instagram has made several changes to curb bullying on its platform. it will give users the ability to turn comments off on any post comments by tapping an icon to encourage positivity. they let private account holders even if they decide to accept them. joining with me -- joining me is caroline hyde. to think these tools go far enough? is the third time they are rolling out a new safety features. they are showing twitter up. they are trying to get ahead of the curve. they are helping curb some of the bullying, and showing a lot of positivity with the tapping of a heart. the fact that you can disable comments and posts, you have to stopprivate user to certain users. that they are a step ahead of the dialogue and it seems like every big social media juggernaut is facing more stress about fighting off so-called hate speech. emily: if you have a typical public account, i believe you can block users, and there have been some celebrities reportedly testing these features like kylie jenner and christie teagan. they've also enable users to filter abusive words, which is similar to twitter. there seems to be an outcry from the community that these companies need to do more. >> exactly. and you can have more control, so that someone who has limited access cannot hijack the popularity of a certain celebrity or even just a friend and start to disseminate some of their full reviews or hateful comments. this is certainly something that will, head of the game and will put twitter slightly behind the curve, as they seem to have been slow to react to this sort of abuse. emily: instagram is part of a coalition to crack down on terrorist speech. the eu is wanting technology companies to take a greater stand against terrorist content. facebook, google and microsoft are teaming up and they will andte a digital database content can be flagged so that if a video shows up on twitter a cannot also be posted on facebook. tell us little more. it gives it a fingerprint. if it seems to be related to a terrorist organization and it pops up, they would be able to stop it in the future and immediately alert microsoft and google. it is down to the individual service provider as to whether they take that particular video off-line if they do find it on a particular service provider, but it is meant to show eu , today it became official that the eu said you're not doing enough quick enough. you promised us six months ago when you joined this agreement, this code of conduct, that in 24 hours you would be able to basically take down any offensive hate speech or terrorism related postings. only 40% of that has been taken down within 24 hours. germany, where i am normally based, is seriously trying to clamp down on this. they're saying by the end of next year, we want 70% of these taken down. we are seeing these four companies trying to get ahead and work together and show they are taking it seriously. emily: i also want to say that you will be filling in for me while i am on maternity leave. thank you so much for flying all the way here to san francisco. i am here for a couple of more weeks and then it is all yours. : caroline: what an honor. i have to say, it is a lot warmer here. [laughter] emily: it definitely worked out for you. caroline hyde, she will be filling in for me for the next few months. please give her a warm welcome. that does it for this edition of "bloomberg technology." tomorrow, arrieta huffington -- arrieta . anna: taking a hit. the aussie dollar drops and asian stocks stay in positive territory after a rally in u.s. markets. another record high. cutting costs at credit squeeze. slashess banking giant its cost base in a bid to make the bank more resilient in difficult trading conditions. edging closer, the italian senate is expected to approach -- approve the nation's budget, clearing the way for the prime as they to step down continue talks to real and