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tv   Bloomberg Markets Americas  Bloomberg  November 25, 2019 1:00pm-2:00pm EST

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lead to u.s. sanctions. they have sparred over the potential risks of the missile system. right police in hong kong today blocked hundreds of activists from advancing into the polytechnic university. they want an end to the siege now. local authorities say they will send a team of negotiators into and theus to find remaining holdouts. british johnson is trying to consolidate his lead in election polls. he has unveiled the conservative party manifesto promises tax cuts and pledges to hire 50,000 extra nurses for the national health service. the prime minister is also vowing to get brexit done. the british election is december 12. an agreement to make the european union the first climate neutral region by 2015 is said to be the biggest challenge up for discussion at that year's summit.
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among the top issues will be zero down greenhouse gases by the middle of the century. that is the cornerstone of the green deal pledged by incoming -- the incoming european commission president. global news 24 hours a day, on-air, and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg. in his 1:00 in new york, 6:00 in london, 2:00 and hong kong. i'm shery ahn. welcome to bloomberg markets. from bloomberg world headquarters in new york, here are the stop -- top stories on the bloomberg and around the world that we are following. stocks in the green after china says it will raise penalties on violations of intellectual property rights. its trade deal imminent.
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n versus oxime. carl icahn is about to receive control of the board. we will have details. drug pricing transparency. to medications cause three four times in the u.s. and elsewhere, and what president trump proposes to do about it. in the meantime, halfway into the trading day. green, risk on across the board. small caps also performing. kailey leinz, what do you have for us? kailey: small caps are performing, up about 2%, the best day for the russell 2000 since september. as for the major averages, it is a risk on day. the s&p 500 and the nasdaq at new record highs. the data 40 points shy of a record high. the nasdaq getting a boost from that ip development development. what is leading the performance is technology and health care.
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if we drill into biotech, take a biotechthe nasdaq index, up 2.4% today, at its highest since october of last year. the biggest driver is medicines company. novartis agreed to buy the company for $9.7 billion. that is giving a boost to other names in this space. arrowhead pharmaceuticals getting an upgrade on the back of that novartis deal, saying it supports the outlook for that deal. technology,or, after those china ip theft crackdowns. it is giving a boost to some of these companies, nvidia, applied technology. -- materials. apple also getting a lift off the back of that, up 1.25%. these tech name did not need an intellectual property boost in terms of market performance.
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if we look at the s&p 500 technology sectors performance so far this year, it is up more than 40% this year, on pace for its best year since 2009. i should mention valuations are now at their highest in 12 years. shery: thank you so much. ok.o miss vonnie, so that's our next guest wonders whether conventional wisdom may be too optimistic. we welcome marc chandler. ray to have you with us. of course, we are seeing the dollar index hitting an almost six-week high, a lot of trade optimism out there. ray to have you with us. are the markets getting ahead of themselves? how big of news isn't that china is giving this supposed concession on ip? before last week, the s&p 500 and the dow jones were both up six weeks in a row. last week, we saw profit-taking. are the markets getting ahead of today is showing us it is not so much about china's ip action but buying on the dip.
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if people have not given up his bolus -- bullish sense of the santa claus rally coming early. shery: we have seen the vix gain ground toward the end of the year. is this what we will see as the market seems to be moving on trade headlines? marc: it seems to be the case that we have the santa claus rally and then profit-taking. higher in0 gapped september, protecting it at about 3100. i'm concerned that we are getting ahead of ourselves on earnings, and news. the only currency that is up today is the british pound. we are getting ahead of ourselves on brexit even. after this election coming up, there is still the possibility of a deal at the end of next year that will not be struck, and then they go back to the wto. there is still the risk of a hard brexit. the market is getting ahead of itself. shery: sterling outperforming today. what happens if you don't get
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something substantive? will it be easier to reach bottom again? marc: you have this reality now, so maybe it is buy the rumor and sell the fact. shery: we also have not been factoring in the fact that president trump has a decision coming up, the hong kong human rights and democracy act. he says he is planning to sign it. we seemeantime, pro-democracy movements in hong kong gaining ground. how do you factor into the markets when you don't know what will happen on a geopolitical side of things? marc: it is still an unknown. more than a month ago, there was a deal in principle that was struck. overnight about china passing these laws about intellectual property protections, the problem has never been what china says. china often says the right things. we often draw a distinction between what they say and what they do. that remains a big problem.
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the enforcement of these statements and loss, how will they be enforced? shery: that is an important point. they already have these laws on intellectual property rights. it is not that they don't have the laws, they need to enforce them. marc: this is why it's a mistake to think about the u.s.-china confrontation as being like the confrontation in the 1980's. some of the people that president trump surrounded himself by work in the reagan administration as they negotiated with the japanese. but the chinese is a different challenge for the u.s., different value system. this is going to come to bear, which means we can suspect a sustained struggle between the u.s. and china for years to come. shery: a different issue having hong kong in the mix. hong kong is a financial hub. do you buy into the idea that it is being threatened as a financial hub? about chinese history, the idea that after the communist mao revolution, they
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punished shanghai at the time. i thought the same thing might happen to hong kong over time. develop as a more important financial center for greater china. i think what these demonstrations are showing us is they are accelerating this move. it will not happen overnight. property rights are still holding up. alibaba just held its ipo in hong kong. over time, i think these demonstrations illustrate that hong kong is part of china, as if anybody would be confused by that. that means overtime we need to sign off on hong kong. shery: alibaba starts trading on tuesday. dend for cashs jumpg in the city. this chart on the bloomberg showing it remain elevated despite the fact that we have seen a little bit more conciliatory moves.
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some have laughed in my face when i ask about the hong kong dollar breaking the dollar peg. what do you think of those remarks? the hong kong dollar, the stability is to elect the golden egg. it is still important for the stability of hong kong and chinese companies to raise international capital. i think the peg is sound. every once in a while people get the idea that they will challenge it, but not in the spot market. where you challenge is the forward market. differentials are wide and a way to defend the hong kong dollar. not betting against the hong kong dollar, but that interest rates have to rise. bass. tell that to kyle our thanks to marc chandler. coming up, carl icahn goes after occidental. the billionaire investor and critic of the company is said to be seeking control of the board. we will have the latest. this is bloomberg.
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shery: this is bloomberg markets. i'm shery ahn. time for the bloomberg business flash, a look at the biggest right now.the news the largest luxury goods deal ever. lvmh has agreed to buy tiffany's for more than $16 billion. right now. that will raise the french conglomerate's profile in jewelry and gives them access to a bigger chunk of american choppers. the deal values tiffany at 37% above the closing price on october 26 and the wind bloomberg reported the initial approach. ebay is selling its ticketing business stub hub to a swiss ticket reseller. the price is a little more than
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$4 billion in cash. stub hub is one of the most popular sites to buy and sell tickets to sports events and concerts. ebay bought the company in 2007 4 $310 million. teva pharmaceuticals and other generic drugmakers have held talks about resolving a u.s. price missing and get -- fixing investigation. one of the possible outcomes with the justice department is a part -- deferred prosecution agreement. drugmakers would admit to certain allegations but would not be indicted. in return, they would pay fines and cooperate with investigations. that is your business flash update. let's turn to a bloomberg school . carl icahn is trying to seize control of occidental petroleum's or. icahn plans to nominate a slate of 10 direct or's. she has been a vocal critic of the company over its three $7 billion takeover of anadarko petroleum. joining us is the reporter who broke the deal, scott deveau. congratulations on this group.
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tell us what this would entail. carl icahn has tried in the past to put directors on the board, and that did not help out. what he was trying to do was solicit support from shareholders. this time around, it will be looking to replace the entire board at the annual general meeting. so what exactly is carl icahn so unhappy about in this deal? the original point of contention is this $37 billion takeover of anadarko, and also the fact that this transformational transaction didn't go toward the shareholder vote. he also has an issue with the financing they took from warren buffett because of the price of the coupon attached to it. it is actually quite pricey. for that reason, thought it should have gone to a shareholder vote. shery: how is that playing out with other investors? his stake is pretty small. scott: the overall share price
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has fallen about 40% since the news are merged that oxy would go into a bidding war for anadarko. a lot of that has to do with oil prices. but the amount of leverage they took on in order to pursue this transaction is also weighing on the stock considerably. somess you would say that of the investors that were originally in the stock prior to the takeover have obviously fled , or the overall value and prospects of the company have gotten more murky. shery: if he gets his way and puts 10 directors on the board, what will he do? scott: he originally said he wanted the company to launch a strategic review, including a sale of the entire company. that would be presumably the avenue he would pursue. shery: who would try to buy this company? it is huge. scott: two in the u.s. that could be potential buyers, pursuingtself, who was
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anadarko at $33 billion. now the combined anadarko-oxy company is valued at $35 billion but has more leverage. the other one would be exxon. whether either of these companies are interested remains to be seen. shery: what is occidental saying about it, how do they want to stay these issues that icahn is not happy about? scott: a lot of it comes down to paying down debt. they will sell assets based at $10 to $15 by 2020, use the proceeds to pay down debt, in order to increase the financial stress on the company. they were also curtailing spending next year by 40%. that will also let them pay down debt. shery: what are analysts saying about the plans, do they prefer those plans from occidental, or a carl icahn takeover? really focusody is
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right now on the dividend, the financial health of the company. i think there is a divide on whether the dividend is sustainable. community the analyst believes it is because it is largely hedged. that think ite oil prices continued to tumble, could be a problem for the company. shery: what is the next day we had watch out for, the deadline for the nominations? scott: the deadline at the end of the week on friday. what we will likely see is a formal nomination of these 10 directors. we will likely find out who they are as well, and then we will go from there. shery: scott, thank you for that. the latest on the anadarko-oxy deal. americans spend more on prescription drugs than anyone else in the world. they take a lot of pills, but what sets the u.s. apart from most other countries is its high
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prices and the obstacles to lower drug prices. that is next. this is bloomberg. ♪
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shery: this is bloomberg markets. i'm shery ahn. in the news today, teva pharmaceutical and other drugmakers holding talks with the justice department to a criminal antitrust probe of alleged price-fixing by the company. it's the latest on one part of the conversation surrounding prescription drug pricing. joining us from baltimore with more is dr. gerard anderson. he is the professor of international health at the johns hopkins international school of public health. thank you for joining us. we also heard from the president , tweeting on friday about allowing importing of drugs, prescription drugs from other countries. we have not heard more details,
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but should pharmaceutical companies being nervous? who should be most nervous? >> the people that should be the most nervous are the branded companies. the is concerned that generic drugs, which about 90% of the drugs sold in the u.s. are generic drugs, are generally inexpensive compared to the drugs and other countries. but for the branded, specialty drugs, those are the ones that are most expensive, those are the ones congress is focused on, and the ones the companies should be most concerned. shery: it seems congress is considering legislation on this front. what are you expecting in terms of policy that can actually come forth on this issue? gerard: there are two wr areas, one is rate of increase and drug spending. do we keep raising the list price, the price the drug company announces. that goes of 6%, 10% a year. i think this is likely to pass
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in congress. ratesss will say the increases can go of no more than the inflation rate, which are be substantial. essentially, you have seen for everyone time the drug companies have lower the prices, they have increased the prices on average of 90 times. much more likely to raise the prices than lower the prices. the second big area is looking at the prices in the united states vis-a-vis other industrialized countries. we just wrote a paper that was published that said, on average, we pay three to your four times more than other industrialized companies or the same branded drugs. president trump has already focused in on a certain subset of branded drugs, those that are prescribed by physicians, part b drugs, but the bigger ones are the part d drugs, the ones you get at the pharmacy. four times more
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expensive. it is hard to justify why the united dates should spend four times more. shery: i found that system really interesting here in the u.s. very concerning. alsoave big farmer but you have these pharmacy benefit managers. the drug companies themselves are trying to generate -- justify the prices because of the r&d and how much they invest. are they worth all they are charging the patience for -- patients for? how much does it take to invest in this research? gerard: the investment starts at the national institutes of health, which puts $30 billion a year into research. much of that goes to academic medical centers like johns hopkins. they are the ones doing the initial research. that is where we get most of the initial innovation. then it typically goes to venture capital. they see something promising
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developed and bring it forward another step or two. then there might be other parts of the market that get engaged. it is not until the drug is really developed an almost through the whole fda process, that in most cases, the big pharmaceutical companies get involved. the research, development has already been done, and then they buy it. they need to buy it at a higher price in order for the research to continue because you have to motivate people, but at the same time, they are not the ones doing the innovation. shery: your thoughts on medicare for all? is there an upside to have this giant negotiation -- entity to go shooting prices lower? gerard: may be a part of medicare for all his having the government negotiate prices. what we see in other countries is it is one entity negotiating prices. in the u.s., there are literally
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hundreds of entities negotiating prices. that does not make for a good negotiation. the reason why we spend three to four times more than any other country is the way we buy drugs, which is essentially not having one entity by the drugs, but having hundreds of entities by the drugs. shery: everyone seems to be against these pbm's. is that a sector of the industry where we could see change? gerard: i think so. one of the things we are working on is with a large corporations, asking them to look at their formularies. what drugs they have on their list. what we see is they have a lot of unnecessary, ineffective, what we call wasteful drugs on their formularies. when they look at it, they say, why are they on the formularies?an example of this would be a branded drug which is more expensive than a generic drug, having the branded drug on the formulary because the pbm
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gets money for that particular branded drug, and the generic will not pay a payment to them. what we see is we are paying a lot more for these drugs because of the pbm's. they are negotiating lower prices but they are putting the wrong drugs on the formulary in order to make a substantial profit. shery: thank you so much, dr. gerard anderson. professor of international health at the jon hopkins university bloomberg school of public health. course, supported by michael bloomberg, founder of bloomberg lp and bloomberg philanthropy. 20 more coming up. we will be talking about hong kong. this is bloomberg. ♪
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mark: i'm mark crumpton with bloomberg first word news. the head of iran's revolutionary guard threatened the u.s. and its allies today. the threat came as he addressed a pro-government demonstration
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attended by tens of thousands announcing last week's violent protests over a fuel price hike. he accused the u.s., britain, israel, and saudi arabia of stoking the unrest. he said if you cross our redline, we will destroy you. amnesty international says at least 100 33 people have been killed in the protest. it was "clear evidence that iranian security againstsed firearms unarmed protesters." right police in hong kong today blocked hundreds of activists from advancing into the polytechnic university. they want an end to the siege now in its night the day. local authorities say they will send a team of negotiators into the campus. they want to try and find and coax the remaining holdouts to surrender. can the fed fight inequality? neel kashkari says yes. he says monetary policy can play
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a kind of readership in a role once thought to be reserved for elected officials. he laid the groundwork for a shift in fed communications this year. fed chair jerome powell and his colleagues have cited low-paid americans when interest-rate cuts this year. meantime, neel kashkari has hired a former obama economist to head of the new institute for inclusion. . that was partry of the rain that ended in the al-baghdadi got a hero's welcome at the white house today. president who earlier said that the dog's name was classified introduced conan to journalists before it surprise event in the rose garden. global news 24 hours a day, on-air, and @tictoc on twitter, powered by more than 2700 journalists and analysts in over 120 countries. i'm mark crumpton. this is bloomberg.
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shery: live from bloomberg world headquarters in new york, i'm shery ahn. amanda: live in toronto, i'm amanda lang. we are joined by our bloomberg and bnn bloomberg audiences. shery: pro-democracy candidates sweet hong kong's local elections, see record turnout, and a big win for pro-democracy lawmakers. reshaping the brokerage business. charles schwab agrees to buy td ameritrade for about $26 million in a deal that will change the retail brokerage landscape. uber was stripped of its license to operate in london because of safety concerns. they say they have found a fix to make the app safer for passengers. amanda: let's get a quick check
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on the major averages. some enthusiasm, positive goodtum in part thanks to news on global trade, specifically china saying it will take a closer look at intellectual property and cracking down on any wrongdoing. that could be to a deal. we also have some merger activity that is london summit doozy as an. we do have technology leading the s&p 500. energy showing some weakness. the nasdaq hitting a record following some of the other markets. a quick check on a read of sentiment. this is the short positions on the vix. this chart shows you where we are. that is a record level of the volume of short positions. interesting to see volatility coming out of these markets, a little more optimism as we climb that wall of worry. risk: also helping appetite is the pro-democracy movement in hong kong, seeing a
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huge victory in the district council elections. there was a record turnout of 71%. more than 2.9 million people cast ballots. of course, we have seen the unrest in hong kong continue for the last five months. one of the key reasons for that dissatisfaction has been soaring hong kong prices for property, which has been a big issue. we are now seeing prices up 10% from january to may, but since then, have moderated two half of those gains. kong andck with hong talk about those elections. voters delivering that stunning rebuke to beijing in the local district council kong and talk about those elections. elections, pro-democracy candidates enjoyed an overwhelming victory, winning 85% of the 452 seats up for grabs. for more on these results, let's bring in damien says our -- sassower.
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it is not just how many people voted for the pro-democracy how many people voted for beijing, and that number plunged. >> 13% from as high as 16% -- 63% the last time they had the elections. howyou make a great point. that 71% voter turnout was double what we saw in 2015. that is a huge number. you saw the lines on television. what does this really mean for hong kong? the district council has little impact on who will be the next ceo of hong kong. be not necessarily a impact on the economy or politics, but there will be a referendum on what is going on in hong be kong. you saw the news, the china foreign ministry just invited the u.s. ambassador to come in for a visit. i know they tried to bring him in last week when the ambassador was on vacation. nevertheless, getting him back in, i imagine this will be a
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slap on the wrist from beijing as opposed to the u.s. interfering in the hong kong elections. the official beijing response to this is that it does not change anything as far as hong kong is concerned, but it does change the sentiment, will bolster those on the ground in hong kong. from the relevance of that, remind us where this is going, in terms of where we go next with the protests, what they hope for, what does this change? property prices are down 30% month over month. unemployment finally tipped above 3% in the last print. consumption is down 3.5%. tourism is down 20%. the economy is hurting, for sure. do to get relief in the tensions in hong kong is going to be good for both the economy and the trade negotiations with the u.s.
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we see data coming through out kong, their trade deficit is expected to widen slightly last month. pmi coming in for china on thursday. that will be a pretty big print as well. shery: we have yet to see president trump sodding human rights and democracy act. what will that do to u.s. china relations? kong, their trade deficit is expected to widen damien: they will have a discussion today. i don't think it is going to be plausible for president trump to backtrack. he will probably have to sign the bill. of how her the guise signs the bill, what he expresses to the world at large which is what will matter to china. that has to be the discussion at this point. amanda: there are a number of moving parts that could color or not color the trade talks. ofy seem to be reasons optimism around advancing the agenda of trade. meanwhile, we have the hong kong
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protests, fresh tweets from presidential candidates, and here we have new documents dropping about chinese intelligence around the impingement -- imprisonment of ethnic uighurs. where does that fit into your view of advancing the trade file? a lot of political noise around us. damien: it is the trump administration which has really linked the well-being of china's economy to trade to the uighurs situation to hong kong. it has extended way beyond national interest in terms of what the relationship with china means to the u.s.. a bear, and it is difficult for analysts and strategists you wrap their arms around what this means for asset valuations going forward, especially in a world with negative yields. china is one area of the world where you get some positive carry, positive yield with a relatively stable dollar-you want relationship.
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keeping that relationship is going to be key to everything going forward. whichw the ip protections were announced today, you cannot really enforce that in china because they control the judiciary. there will still be a lot of room left after phase one, if it is completed. it will be a long haul, for sure. amanda: thank you so much for that, damien sassower. only elections are not the big story affecting china today. beijing has said it will raise the penalties it imposes on violations of intellectual property rights in an attempt to address one of the key issues that spin a sticking point in trade talks in the u.s. tom orlik is in washington. there are a group of people trying to figure at asset valuations in the middle of this great can talk city of political and economic, trade negotiations. this latest ip move feels important. is that a fair assessment?
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>> certainly significant, amanda. where we are is continuing in this moment of optimism but also uncertainty ahead of a possible phase one deal. the chinese picks up the phone and invited the u.s. trade lighthizerive robert to come to beijing. now they have announced this step forward in terms of intellectual property protection. is way to understand this this is the offer, part of the offer the chinese are putting on the table to try and determine whether they have done enough for the u.s. to come out and either move negotiations forward or potentially that phase one deal. shery: i have to be more cynical here. you and i were in beijing last week. the problem is not that china doesn't have rules. the problem is will they enforce
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them? how much significance can we give to this concession? what is looked at as a concession, if we don't have anything in the sense of it or spent? tom: that's completely right. i share your cynicism. i was in china for 11 years, shanghai and beijing, and there times whener of chinese officials committed to doing more to protect intellectual property, to creating a level playing field , and ofign firms course, the implementation was where it fell down. potentially, that is where the complication will times when be, even in a phase one deal. china will say we are offering you intellectual property protection, that is what you asked for. now you have to remove some of your tariffs. side,wks on the u.s. people like ambassador lighthizer, the president's
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advisor peter navarro, will say, it is all very well that you promised it, but we want to see you deliver it. until then, we are keeping substantial tariffs in place. the question is, is that a deal, is that on acceptable to beijing? amanda: as long as you both are being cynical, i will join in. is it possible there is an element of face-saving going on here, that intellectual property needs to be summer in the next because we have identified it as an issue, and even if nothing changes, that allows everyone to say we did something? tom: that is certainly a good way to look at it. the way i would put it, what china needs to do is find policy initiatives which are in the neededpot between domestic reforms and concessions to the united states. if you look at the chinese policy document on intellectual
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property protection, there is no mention of the u.s., no mention of the trade war. domestically as a crucial reform needed to increase the efficiency of the chinese economy, increase the incentive to do research and development. when it comes to the u.s., that same policy proposal is presented as an important concession in the trade war. the question is, can china find enough of those initiatives, enough of those policies in that sweet spot, to get a deal done? shery: tom orlik, thank you for that. the latest on china u.s. trade. coming up, it's official, charles schwab announces its purchase of td ameritrade. we will fill you in on the details and how it will shape the brokerage business. this is bloomberg. ♪
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amanda: this is bloomberg markets. i'm amanda lang in toronto. with shery ahn in new york. the cookeds time for it, a huge deal in the retail brokerage business. charles schwab has agreed to buy td ameritrade. the all stop transaction is valued at $26 billion. the firms were among the pioneers this year and slashing commissions to zero. sure got his first start in the 1970's when fixed-rate emissions ended. he began charging a comparatively affordable $70 a trade. that was the birth of discount brokerages. prices had fallen to five dollars a trade by this year. or loan outinvest money, their holdings for clients when it is not in play in the markets. they can also loan customers
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cash to buy stock and lin dunn securities to short-sellers. for etf's, no fees could be a problem and savings in the legal department could hurt investors in case of a lawsuit. other savings could include building indices in hiring second-tier custodians, or limiting sales and advertising budgets. they all have downsides, and that is today's bloombergquint take. a great setup for this latest deal, including whether it passes the sniff test for antitrust regulators. joining with us is brian. it does create a behemoth compared to the others left in the space. what do we think the antitrust response will be? >> this is the first foray in this space in the discount brokerage industry space. the general feeling is it will probably go through. the question is how long it will take. some speculate it could go into the third quarter of this year.
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the other potential hurdle is there is a growing sentiment that is anti-megathe other potes there is a growing large businesses, whether in finance or tech. this straddles the line for both of them. it's a question of whether there will be appetite for a behemoth in the industry, and whether this merger will go through. shery: the argument right now is this is a great deal or the consumer. do you buy into that? that is what the ceo was saying today but there is no free lunch, as the cliche goes, and an open question on how they will make up for the revenue. certainly some synergies. td ameritrade relies more on fees. now that those are zero in a lot of cases, that will be a problem. it's an open question about how they will make up the fees. they may charge more for different things. i have already heard back from different people who use charles schwab to say that is right, we will be keen, and will be
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watching to see what they do to make up for the revenue. amanda: this has been such an interesting story. the race to zero on the fee front was like an iceberg on the horizon, it was coming. for other sectors, maybe a wake-up call that it is coming fast. to me, one interesting aspect is td taking schwab's stock, no cash. it speaks to the optimism in the sector. brian: schwab is the market leader in a lot of ways, the expectation that it located -- will continue to be through this action. my fellow opinion columnists who are expert on these things says he likes everything that came from this. a lot of synergies could be created. overall, it seemed like a really good fit. expectation that there should be optimism. obviously, we see that in the stock price going forward.
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it will be a matter if they are able to pass on savings to the consumer, get more people in their tent, and keep growing. amanda: is there a downside here? you say good for the consumer on the base of it, fees drop, but there could be a negative? do we see the quality of service under threat at all? brian: that is the question. from feedback i have received, there's an open question about how td and schwab -- whether they will close branches, whether the brick-and-mortar service will be reduced. there is no indication yet that that will happen, but that is a risk. as i wrote today, you have to be sure, if you are schwab, to keep the little guy in mind. that is ultimately the base of this company, and how it will continue to rise. shery: brian chappatta, thank you. a blow to uber overseas. my london has stripped the ride-hailing giant of its license, and what it means for the company.
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this is bloomberg. ♪ this is bloomberg. ♪
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amanda: this is bloomberg markets. i'm amanda lang in toronto. shery: i'm shery ahn in new york. london hits the brakes, the nine ride-hailing giant uber a license in the u.k. city for the second time in three years. london is transport regulators cited safety concerns in the suspension come including the ability for another rise users to pose as drivers. uber has 21 days to appeal. for the latest, let's welcome shira ovide. what was the problem this time around? >> london regulators said uber fixed some of the problem they identified from a few years ago when they had these licensing issues, but they are still concerned about rider safety issues. the london regulators singled out this problem where unauthorized drivers were able s, basically driver
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stand-in for other drivers and carry out more than 14,000 rise, including by people who were not properly licensed or had safety concerns. that was a big safety issue for the london regulator. amanda: one thing that is interesting about this is uber has continued to operate through this. i understand it will continue to operate now. the company is saying this is out of date. there may have been problems, but they fix them since the original complaint. is there validity in that, the way they operate? shira: it is a little bit of a he said, he said scenario. right now you are right, nothing will change for uber in london, they will appeal the decision. so the company will continue to operate status quo while that appeals process goes through. what uber said is they self identified what they said was 43 drivers. if you are talking about more than 14,000 rides, more than 300
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or so rides per unauthorized rider. the london regulators said that happened as recently as october. so this is not like an issue that was fixed many years ago. this is a relatively recent issue. we still don't know if there are unauthorized drivers conducting ride in london -- or if there were -- what about other cities where uber operates? is this a practice that goes on in other parts of the world? shery: wasn't london supposed to be a success story for uber in there expansion? shira: it was, and it is, to be frank. london is a city that is poorly served by taxi services, as many will tell you. it appears to be a market, although we are not sure where uber generates profits. it is getting significantly more competitive for uber in london, andomers in that city, bolt
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others, and that could be an issue going forward. amanda: mild reaction in the stock today. is that a reflection of the story? shira: i think it's a reflection that nothing will change for uber in london, they will continue to operate as usual. as this appeals process goes through. given the importance of london to uber, i would think that the company will be fixing some of the safety issues. amanda: shira ovide, thank you. just a reminder, bloomberg users can interact with all the charts you have seen on the network. the function on your terminal is gtv . from toronto and new york, this is bloomberg. ♪ berg. ♪
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mark: i am mark crumpton with bloomberg's first word news. a hong kong legislative counselor with five others urged the polytechnic university authorities to do something to
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resolve the weeklong crisis after they met with protesters today. the legislative counselor told reporters university authorities are planning to enter the campus on tuesday. he added that he believes the best way to resolve the problem is the university takes the lead. >> i hope they will take over the management of the campus, and then the police can relax control and leave. i think this is very important. i hope the university will realize that. mark: police had stormed the campus overnight and made dozens of arrests before retreating. china is offering a compromise in the trade war with the united states. it will raise penalties on the theft of intellectual property rights. that has been one of the major sticking talks in trade talks -- points in trade talks. the u.s. wants china to

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