imports the china and over the south china sea. we have seen the offshore yuan versus the dollar trade lower following these tweets, and the question is whether this is more empty rhetoric from donald trump or whether he will be taking a more confrontational line with china. >> very much the word out of beijing is that he is not president yet, and perhaps he is being badly advised. they are doing everything they can right now. >> america's four-decade one china policy may be put to the test with president-elect donald trump, saying no one can tell him who to talk to. this comes after the uproar after his phone call with the president of taiwan. he says his attitude will depend on securing better trade deals with beijing, and the one china policy he says may be china's policy, but not america's, unless he can make a deal. what is the buzz on the ground in beijing as to how china is likely going to react here? >> there has been no official comment so far, but we have had an indication from the state media as to how some here feel. th

positive for china. exports exceed imports, that is a fact. a lot of is also generated from the service industry, so in the long run, china's economy looks good. and there are a lot of chinese companies who are looking overseas to acquire businesses, but they keep getting shut down by regulators, including yourself. what is the impact for chinese companies in the future? how do they fix this? fair.needs to be china welcomes foreign , so other countries should also welcome chinese investors. >> this is a massive undertaking, the transition of the economy, but you can see, the research side, the consumer side, the tech side is going very strongly. the chinese firms are beginning ageinvest in lower-w economies in the same way that other businesses used to invest in china, vietnam, myanmar, africa, and effectively replicating the stage of development they went through and other countries and building infrastructure to create trade flows, trade corridors. as ever when you're trying to do something very ambiti

china, flying nuclear capable bombers over the south china sea for the first time in an apparent warning to president-elect trump. this after trump questioned whether the united states should keep its long-standing policy that taiwan is part of one china. we'll get reaction to all of this from a democrat on the house intelligence committee andre carson. and our correspondents, analysts and guests are standing by. first, cnn's ryan noblestower i. what's the latest? >> reporter: it's been a busy day for donald trump here on 5th avenue as a parade of potential administration officials have made their way into trump tower. as the trump transition continues to take shape, the president-elect remains at the center of a fierce debate over the alleged role of russia in an attempt to interfere in the presidential election. tonight, donald trump refusing to accept cia reports that conclude russia attempted to intervene in the presidential election, tweeting can you imagine if we tried to play the russia/cia card? it would be called conspiracy theory. this just hours after telling fox flues t fox n

china policy. mr. orlins: does this, excepting a call when he is not yet president, i would argue that what our prohibition is about official contact and since he is president-elect and not yet president, that actually is not an official contact. no? that is ager: well, good way to describe it. [laughter] -- orlins: sense that it since i look to avoid confrontation that is the way i choose to describe it. i look to the secretary of state in taipei and i know since i worked in the state department there are prohibitions. i said wait a minute, you're not supposed to be here. he's a, i have been named but i have not taken off yet. i am not official. so there is precedent for that kind of contact. so what do you think after that , the president-elect was out a tweet after he criticized and i had to write it down to have it precise. "did china ask us if it was ok to devalue their currency, making it hard for our companies to compete? heavily tax our products going into their country? the u.s. does not t

china says taiwan is not its own country. china says taiwan is part of china. we decided in the 1970s, to recognize one china, just one chinese government with its capital in beijing, that was a change for us. we changed course after decades through great diplomatic pain and achievement, we made the decision to acknowledge that the chinese government is the one and only chinese government. we do not maintain separate diplomatic relations with taiwan any more. not since the 1970s. but today donald trump called and spoke with the president of taiwan. and then released this statement, announcing the call as one of his calls with world leaders today. if you don't follow this stuff, a call to taiwan, a call between the president-elect of the united states and the president of taiwan, it may not seem like the biggest deal in the world. hey, it's just one phone call, why is this a big deal. this is something we don't do as a country. this is something we haven't done on push, very carefully for decades. this is the first time a president-elect of the united states has

china is firing back. an editorial in the people's daily -- that's the official newspaper of the chinese communist party -- and it comes with this warning to trump, writing international relations 101. china is an independent sovereign state with its own national interests. as a sovereign state, china sets its own policy and can retaliate if necessary. so what is donald trump doing? right now we're get something very mixed signals from trump and from his inner circle. just yesterday, trump's top aides crisscrossed the airwaves to insist that his call with taiwan's president was not a provocation with china. >> chuck, this was a courtesy call. >> nothing new should be read into it? >> well, i don't think so. >> does this signal a change in policy or was it just a phone call? >> it was just a phone call at this point. >> the folks inside trump's transition are leaking the opposite view. "the washington post" is reporting that trump's call was an intentionally provocative move, and it was planned weeks ahead

cpi year on year from china. and the correction we have, 3.3% for the year on year, as opposed to the number expected of 2.3%. at the moment, 1.5% moved to the outside was month on month, not year on year. so that is what we have currently going on. the ecb sent shock waves through europe and bond markets, more hawkish and dovish than expected -- expected. they will buy fewer bonds per month. does that work or not? >> that is the question of the day. especially if you're a global bond trader. cutecb announced it won't its monthly bond purchases to 60 billion euros a month from 80 billion euros. you could call that a tapering, right? that was not expected it, so that hit the market hard. but notwn the road, now. the extended its bond purchases six months past the march 2017 and date. nine months, now they are to the end of next year. that is more because they said they would be done at the end of the third quarter. we would get a six-month extension. means 540 billion euros more purchased than it would have been o

that may have already gone to china or may soon go to china. >> so that's why there's a much greater fear in failing to catch chi mak. >> in 2004, the chinese didn't have a strong navy capability. they were really a brown water navy. a navy stable to operate in shallow water. chi mak chose the chinese efforts to be able to expand their capabilities into blue water. >> if these technologies are lost, then it means we don't have that edge. so, god forbid, if there's ever a conflict in the pacific that involves china with us on the other side, then i believe lost technology will cost u.s. lives. and that's one of the things that makes me angry. >> in the fbi we have to follow principles, policies and laws. and one of those is we have to have the evidence. our greatest fear initially was, will we catch chi mak doing what we thought he was already doing? >> the thing that hit me hardest about this case was that we've got a man who came here for better opportunity and, in fact, was a spy. sent by china to come here, pledge allegiance to the united states. he took an oath with a full intent

and china last year. more of that is imports than exports, true, but americans are consumers as well as producers. if we begin to block off access to our markets, they block off access to their markets even more, that is not good for americans. does russia due to chinese relations? russia is complicated. the last few years have been dominated by talk of russia and china working together against the united states. it is a murky game. i am not sure how that will play out. after the election, almost all emerging markets went the -- immediately after election, almost all emerging markets went down, because there was expectation of fiscal stimulus, and fed tightening, that would pool dollars back into the u.s. the exception was russia. markets because the where more accommodating with even the lifting of sanctions. vonnie: if you look at the bloomberg at the primary winners, there is another russian index in the top 10. you are just back a few months ago from some baltic states. what did you make of the reacti

more signs of china cracking down on speculation. at least on their commodities markets. 2%, 2.5%.s up back to the opec story. what are we seeing as far as effects? airlines and oil producers, very basic, plain, vanilla. chinese airlines down. southeast asia, east asia. airlines,oard, qantas so forth. i won't go through this, but fairly substantial gains through a lot of these regions. let's see how far this actually holds. these are extreme gains we are seeing in this space. host: let's explore this a little bit more with craig mcmahon, asia-pacific head of research at wood mackenzie, one of the biggest energy analyst firms. we get good insight into how the oil prices going back to their glory days. does this really mean? -- what does this really made? not the glory days, that is for sure. i think what it does mean is we are going to see the balancing in doing oil markets between supply and demand really being accelerated. oil demand is forecasted next year at about 1.4 million barrels per day. local oil supply is forecasted to grow

he strengthened china? >> well, china is the largest trading nation in the world so tpp had 12 countries, not including china. so it seemed strange the chinese -- the transpacific trade partnership excluded the largest trading nation in the world. >> because it was strategic to offset china. >> well, u.s. and china are partners but competitors. we must remember that. so countries in the region including korea, australia, japan, the philippines which have been under the u.s. security umbrella perhaps have to rethink whether they can count on the same level of reassurance from the united states in terms of. >> that's created anxiety. >> well, they had to rebalance their relationship with china and the u.s. >> there's a global supply chain these days. couldn't china in the event of the trade war we've been talking about couldn't in effect stop production of the iphone tomorrow? >> it could, it would hurt apple first and foremost. you can imagine what that would do to inflation in the united states. what that w

china relations into sharp focus. it was the first time since 1979 that american and taiwant ease leaders have spoken in a broke from practice. it was a routine congrat la tore call but on sunday night he rit sized china economic and military policies in a series of tweets. dm china a front page editorial in the daily warned the united states risked a confrontation with beijing. the obama administration said the national security council officials spoke with their chinese counterparts to reassure them of u.s. commitment to the one china policy. joining me now is ian bremmer, the of the eur asia group, a global political risk consulting firm and ripped haass, the president of the council on foreign relations. his fourth coming book is called guess what. am pleased to have both of them here. so i begin with you, richard. how serious is this? how did it happen? and what is going to -- how will it play itself out, is where i want to go in this? >> it's pretty serious in the sense that the call as you said broke, i would s

-china relationship. we have one china policy, that is all official. contacts must be with mainland china. but we have something called the taiwan relations act that includes the idea that we help taiwan defend itself. that's where these weapons sales come from. the chinese don't like them but they've accepted them over the decades. >> for people who think maybe this isn't a bad idea, putting china a little on edge about what the future holds, and maybe things will be different, and maybe they need to be different in their relations with the u.s. >> well, i think it's the thing if you want to make news, you ought to know you're going to make news. and it shouldn't be inadvertent. if you're going to change a policy of 40 years that's been subscribed to by democrats and republicans alike, you might want to give some thought to it. you might want to do some consultations with people. and you might want to decide whether this is maybe a time to change something. but as far as we know, there wasn't any discussion whatsoever before this phone call. so it doe

has leverage with china right now, you know, china desperately needs the u.s. economy to keep its growth rates up and its middle class growing and trump is going to use that leverage. >> and mike, josh earnest didn't spell out, i don't think he could spell out the progress that supposedly we've made with china but trump spelled out in another tweet some of the problems we have had with china, he says did china ask us if it was okay to devalue their currency making it hard for our companies to compete, heavily tax our products going into their country, the u.s. doesn't tax them or to build a massive military complex in the middle of the south china sea? i don't think so. >> well, i think what china probably was most upset about was donald trump's indiscretion, but as china and the rest of the world are learning is that the president elect speaks his mind. how refreshing is that, david? someone that tells the truth. and the people that are concerned about his behavior, they are the same people who said that when he ran he would never get the republican nomination

china, china, china! >> trevor: chyyyna! ( laughter ) quick question, how are you going to fight a country when you can't even pronounce their name? chyyyna. chyyyna. sounds like a toddler who just learned the name of her private parts. chyyyna! chyyyna! chyyyna! that's where my ties come from! ( talking like a baby ) and, by the way, why do donald trump's suits fit so poorly? i don't understand why they fit like this. they're made for you and by you! why would they fit so badly? i wouldn't be so shocked his suits fit like that because he exaggerates his measurements to his tailors. no, my arm's this long! ( laughter ) since the '80s, trump has been itching to pick a fight with chyyyna. even though it's 44 days till he officially takes office he's already started (bleep). >> in an unprecedented move mr. trump took a call from taiwan's president, breaking tradition. >> calling it a blunder. >> phone call touched you have a weekend diplomatic fire storm with china and broke decades of presidential protocol. >> trevor: yep, onc

china. grew up in china, educated in harvard, stanford, a u.s. citizen. jing, let me start with the election of donald trump. what impact do you think his election is going to have on u.s./chinese relations, the most important relationship in the world today? he's said some pretty menacing things. he's said a lot of things. how worried are you about a sharp decline in the quality of the u.s./chinese relationship? >> well, good morning, roger, thank you very much for your kind introduction. and good morning, everyone. in terms of u.s./china relations, clearly there will be a lot of uncertainties. mr. trump on the campaign trail said that he would grant chibra china a currency manipulator on day one and impose a tariff on chinese exports. let's look at the economic factors. to brand a country a currency manipulator, there needs to be three conditions. number one, this country needs to run a large current account surplus in excess of 3% of gdp. number two, this country needs to have a very larg

east china losing the war? —— is china. no matter how bad it is, we can't say that china is losing the war. that there just tell you, it is tremendously bad in beijing and surrounding area. over 400 million people have been affected. my own personal friends when they go to beijing are experiencing in tamil bleeding for no reason —— internal bleeding. and they have gone back to shanghai. we have spoken to you almost every year for the past three yea rs almost every year for the past three years and you are very supportive of the chinese government and their measures to basically improve the pollution problem. what more needs to be done? they need to shut down coal—fired power plants. they made an announcement to shut down over 20 coal—fired power plants. the equivalent of all of united kingdom and spain's coal capacity combined. they need to have more monitoring and transparency into pollution data. in 2015, at the beginning of the year, they announced a strict environmental law which not only has transparency but gi

the one-china policy is the cornerstone of a healthy u.s./china relationship. i hope the political foundation won't be disrupted or damaged." yes, china seems to be giving the trump team the benefit of the doubt by placing blame on taiwan for this sharp breach of diplomatic practice. for good reason probably. the chinese are, like many others, trying to decipher the true meaning of the phone call. was it just a blunder because of the trump team's inexperience in foreign policy, or was it more significant? does it signal a major policy shift by the incoming white house? interestingly, george, xi jinping, the chinese president, met with henry kissinger friday. the former secretary of state was instrumental in establishing ties between beijing and washington in the 1970s. and he told mr. kissinger it is critical to understand each other's strategic intentions. now mr. shi must be wondering what mr. trump's intentions are and if mr. trump is somebody china can work with in the next four years. george? >> that is the burning question here, what were his intentions.

faith in china. sophie: what are we looking at? >> we saw emerging-market currencies get hammered in response to the fed more .ositive first rate hike the next step according to a number of analysts and traders are looking at china. can they, and will they, have the willingness to continue to support the yuan instead of letting it depreciate faster? reservesthe drop in either chinese, they have been depending -- defending the currency. $279 billion of their reserves depleted, down only $3 trillion, but down from $4 trillion. rishaad: a quarter of their reserves. stephen: there is concern. now china's desire to see the yuan fall is critical to providing, preventing a bigger flight of capital out of china in anticipation of further renminbi weakness or one-off. it exacerbates by what trump has been saying, labeling china's currency as [indiscernible] he wants a stronger you want, but he is also talking up a stronger dollar. which one is it? rishaad: with the fed, when they act, they reverberate globall

we trump: i do not see why need to be bound by the one-china policy unless we make a deal with china. they are taxing us heavy at the borders when we do not text them. -- we are mess of building massive fortress in the middle of the south china sea. >> trump already angered china when he took a congratulatory call from taiwan's president. he is the first u.s. leader to officially talk to at taiwanese leader in four decades. genie: the champions league is coming up in february. we have found out who will be playing whom in the final 16. the big games to watch our monaco versus massachusetts city. and for the other fans out there, pfg versus arsenal on a. it is december. christmas is coming to while santa claus may be almost sameness -- most famous for flying through the skies with addedindeer, he has diving to his skill set. underwater santa is a biologist at the guadalajara zoo in mexico. he wanted to give them and their visitors a different take on yuletide fun. he will do that throughout the rest of december. time now for a business news. we want to show you who has been in the fish

you do not need to own stocks in china. there are enough amazing american companies you can buy technology stocks with, google, facebook, amazon. i would not touch this stock. i would not go here them until we figure out what he's xwoik to do. >> amazon has its own problems with counterfeits. they took counterfeit sellers to court this year for the first time. >> this is a known problem with a large peer to peer marketplace. i don't think it has huge impacts on alibaba. yes, there are brand implications trying to enter the u.s. and expand it to southeast asia. . a announcement the stock dropped less than a percent, down a little more than this morning. i don't think so this is a big deal. what's interesting here is the correlation between this and fake news. you have large peer to peer marketplaces with the goods. it's becoming much more real and this is an issue. ? fake is becoming much more real. little scary. uber, meanwhile, halting its self-driving test in san francisco after about a week and a half, this after the sta

china relations? >> as part of the shanghai communique, so of the clear advantages and obligations obligations, i will not separate my views from the shanghai communique from established procedure. also, at this moment, uh call reaction of the of leadership of the determination to see if a dialogue can be developed. but it is no question that the policy of opening to china is based on the premise. >> does this excepting a call when he is not yet president, i wanted to argue with prohibition it is about official contact and since he is president-elect and not yet president that is not official contact? no? >> that is a good way to describe it. [laughter] >> cents i look to avoid confrontation, a but i do recall pdf running into a deputy assistant secretary of state because i worked with the state department with the prohibition days said you are not supposed to be here he said i have been named but i've not taken officer lance nonofficial. so there is precedent for that but after that turmoil the presi

>> well, with china -- china's claims are basically the entire china sea, they are their waters because of islands and the island ownerships are in dispute and need to be determined by rule of law by the people have countries that have conflicting claims. china has acted unilaterally and has caused a very dangerous situation. we strongly disagree of how china has pursued this issue. it's not only the waters are claiming, the air is exclusive to them. we do not recognize that. the international community does not recognize that. now, we don't know exactly where this vehicle was -- neil: right. >> if it were in international waters this is an extremely dangerous act by china. neil: it follows other provocative actions, just yesterday off the coast of taiwan following on actions they took last week when the leader headphoned to congratulate trump and they responded by a show of force off the coast of taiwan, tripling up and quadrupling up with russian military aircraft they had purchased. where is this going? what does your gut tell you? >> well, clearly what we are trying to do is get the

haslinda: like china. >> like china. we had one in vietnam yesterday as well. we had one from sri lanka, so these are the things that are keeping us awake where we have to react quickly to fulfill customer demand. haslinda: we thank you for your insights today. there you have it. rishaad: thank you very much indeed for that. haidi: that's all right. i will take it. next, we will take a look at what is behind this reversal of fortunes are hong kong developers. this is bloomberg. ♪ haidi: this is "bloomberg markets: asia". i am haidi lun. rishaad: i am rishaad salamat. there is only one game in town, it's opec. is.ette: it certainly look at this rally in energy producers across the asian region, particularly australia. the energy sector on the asx 200 at its highest level since october 2008. each energy of 10%, santos up almost 13%. it continues with a all players well bid today. energy producers in hong kong up , petrochina and sinopec again a good rally. where we are seeing negativity from this prize deal between opec members is in the airlines, theirrease li

however in china it is based on the recognition. recognition of the beijing, as china as china. a one china policy. you recognize china as the seat at the u.n. security council. you recognize china beijing as the seat of government of china and taiwan something different. to have the us head of state call the taiwanese head of state, there is a reason that hasn't happened for 40 years. because those communications between the heads of state should be between the head of the chinese state and the u.s. state. this is not just a disruption of protocol. it is something that has enormous diplomatic and political meaning, certainly to china. i'll tell you tonight it is a 100% certain there are heads spinning in beijing. >> it is in essence truly incredible that this is happening tonight. jim, thank you. i want to go to ivan watson now. our senior correspondent based in hong kong, actually here in new york tonight. and we're awaiting the chinese response. obviously early in the morning in beijing. >> 8:00 in the morning on a saturday there. so it is a bit early. and it will be very int

you're already buying more new china vanke old china. , china in many ways is a microcosm of the way that emerging market equities have changed in the last few years. this is much more of a tech the mastech play that it was four or techyears ago -- of a domestic play than it was four or five years ago. it's a different animal than what it was five years ago. anna: how concerned are you about the way china can rear its head and destabilize global markets? have quite us -- in their piggy bank to play with in terms of supporting the currency. can is something that destabilize markets. you talked about the concerns you have going into next year about the u.s. housing market. others are concerned about chinese debt and that's becoming a big topic. david: there are two big things with china, one is their movements in the currency. why the most positive things to happen in the markets in the last 12 months is that people have learned not to care about what's going on with the chinese currency. it falls and rises. markets don't need to worry anymore. i hope the new u.s. administration will p

and china over the u.s. gettingown, perhaps traders some reason to pull back amid the dollar's strongest quarterly rally since 2008. net long positions on the bloomberg dollar index increasing. if we look at dollar-yen, those are at their highest this year after a surge in the spot rate. a little bit of pullback in the dollar today, money moving into that fate haven that is the yen. fct data, a planned production boost from libya stalls and investors are the most optimistic on oil since the slump began 2.5 years ago. that is looking at net long. longs,unds adding to wti goldin nadal drums. prices have fallen for six straight weeks. hedge funds have cut their bets on a rally to be lowest since february. manus: thank you very much. great round up on what you can focus on in the market. let us focus on bp. they have focused their relationship with abu dhabi by swapping $2.2 billion of their own stock for state in one of the emirates largest on-shore oil conglomerates. anna: signs of growth next year following m

he also accused china of building up military bases in the south china sea and said china had not done enough to rein in north korea, so he has been vocal on this. china has been listening to my but on the other side he wants to appoint to china as an ambassador, the iowa governor terry branston, seen something as a china friend. he has known president xi jinping for quite some time. so what they are trying to work out is whether this is a thought through strategy that trump will take to the negotiating table to win over concessions, or whether it is grandstanding from trump to play to his face. rishaad: tom mackenzie joining us there from beijing. ousted head tata's taking another swing at cyrus mistry at an emergency general meeting. we will be live in mumbai. sophie: plus, the proof is in the pudding. our next guest says we will have to wait and see on whether oil producers stick to their word on output cuts. this is bloomberg. ♪ rishaad: a quick check of the latest business flash headlines. hyundai merchant marine up after announcing it will join the world's biggest shipping alli

inside china but then it would be more amazing for people in china to discover what they have in their own country because people in china have no idea. they did not even know some of the species existed or where they can find them. all they see is brick walls and cities. everyone, in the back of the head knew that this was something that could be done, could be an industry and people are interested in making film and that is the start of something brilliant. incredible talent. if you're scared of heights close your eyes now. one man who isn't is alan eustace, a senior google executive who in 2014 broke the world record for the highest parachute jump. he took a balloon more than 135,000 feet into the stratosphere and skydived back to earth. the space suit he wore is now on display at the smithsonian's national air and space museum in virginia. jane o'brien kept her feet firmly on the ground and went to take a look. what goes up must come down but simply reaching the earth's stratosphere was the first challenge for alan eustace. it took more than 2 hours to ascend 25 miles and around 15

government of china." china views taiwan as a threat and could destabilize an already fraught relationship. trump had a choice, downplay the call or declare he's taking u.s./china relations in a different direction and he seemed to indicate the former. "the president of taiwan called me today to wish me congratulations on winning the presidency. thank you." >> so this was an intentional sort of challenge to the foreign policy establishment, to the u.s./chinese diplomatic establishment? >> no, chuck. this was a courtesy call. they called to congratulate the president-elect. >> so courtesy call, not a change in policy? >> exactly. >> the chinese government took a similar approach. its foreign minister saying, "this is only a little trick put up by taiwan. i don't think the u.s. government will change the one china policy." but negative coverage of the call seems to have gotten under trump's skin as it so often seems to and yesterday he followed up with a couple of tweets striking a very different tone. "did

is part of china. it's not just taiwan according to president duerte, trump said that duerte is going about his fight against the drug lords, quote, the right way. that's a very violent fight. the same president duerte who also, by the way, insulted president obama. washington's been critical of the philippine government's execution of drug dealers without the benefit of judicial proceedings. so let's bring in the cnn politics senior reporter and gordon change, daily beast columnist. trump's call from a leader of taiwan, really a breech of protocol here or was it just a mistake or is he subtly trying to send a message to china? what's your favorite on this? >> that's the answer to that question we don't really know, martin. it's certainly a clear breech of the protocol and practice of the way u.s. relations with taiwan and china over the taiwan issue have been conducted for 40 years. i think it's too early to say yet whether donald trump is previewing a new emphasis and approach in the u.s. policy towa

what was china's reaction? >> reporter: alison, officials are used to hearing tough talk on the subject of china from candidate trump on the campaign trail. they may not expect to hear from president-elect, but that is what they got. the tough line against beijing. he tweeted it out, but it is met with tempered response. a spokesperson from the ministry was asked about the response from china. the response to reaffirm the importance of upholding the bilateral relationship to focus on the economic and trade ties with the two countries. the spokesperson went on to say china would not speculate what is motivated the actions of president-elect and his team. china doesn't comment on the character or style or personality of foreign politicia politicians. they respond to policy. that is the big question. what will the trump policy be toward china? if this doesn't suggest the policies will change under the trump administration, that is yet to be seen. state news has weighed in. one op-ed was penned and that up ended th

it's not entire clear why china took it. this is not like when they kept our high tech surveillance airport that crashed on hainan island and sent it back to us in a number of boxes apparently trying to reverse engineer as much of the equipment as they could. this little drone thing, it's cool, but it's not going to have a lot of intelligence value to the chinese. this is a commercially available thing. if china wants one of these, they're expensive, they're about $150,000, but you can just buy them. this particular one does belong to the u.s. navy, though, and china taking it and refusing to give it back is basically just a one-finger salute to the united states of america. it's meant to be an embarrassment, meant to be an insult, meant to be a diplomatic provocation. and the timing would appear to not be random. at the same time that this has all gone down, late last night, china also announced and released footage from its one and only aircraft carrier conducting its first ever live fire, live ammunition real missile exer

us exports to china are valued at $162 billion. the country is america's third largest export market but imports from china into america are far higher, standing at 498 billion dollars. and this, according to president elect trump, is the problem. a trade deficit with china totalling $336 billion. mr trump says closing that gap would create a lot ofjobs in america. at, although people may blame outside forces, economists argue that the jobs market has changed and that cheap goods from china have been good for ha rd—pressed cheap goods from china have been good for hard—pressed us consumers. china, it may be just a good for hard—pressed us consumers. china, it may bejust a, eno, we challenge them on some policies and they may announce retaliations, they may not, but it looks like quite a bit of friction with china in the months ahead. china's response, as ever, cautious. at caution with an edge. china does not appreciate being called an economic bully. translation: china and the united states as two large countries have shared

recognize kt fap the one china principle is the political foundation of china/u.s. relations. now donald trump is on the defensive. in fact, last night after all of this hoopla, he did tweet out this. he said, interesting how the u.s. sells taiwan billions of dollars of military quilt but i should not accept a congratulatory call. kellyanne conway saying this. >> i can't comment beyond what was said. i won't do that. this is the president-elect and he'll be president of the united states imminently now. he's well aware of what u.s. policy has been. >> reporter: so donald trump's transition team backing this call, defending this call. but many lawmakers, former ambassadors, a lot of people saying this bucks tradition. this bucks protocol. and this could pose a dangerous threat to the u.s. martin and christi. >> thank you very much. >>> we get more on china's reaction, steven yang joining us live from beijing. give us some context, steven, because we did hear from china overnight. and part of what came specifically from their foreign ministry spokesman there. really s

of south china sea? author of the current collapse of china and analyst as well and has lived and worked in this part of the world and i'm curious going back and forth, gordon, what's your real take away about the controversy over this call? >> there are a lot of people in the state department and in washington, foreign policy establishment that are ringing their hands. they are trying to defend a policy that hasn't worked. what they want is cooperative relations with china, to be friendly. the purpose of american foreign policy is not to make u.s. autocrats happy. our policies just haven't been doing it. we need to impose some cost on china and better relationships with taiwan, it's an important cost in the eyes of beijing. good foreign policy on the part of donald trump. jenna: i have to pause you for a moment. we got breaking news from pentagon, producer there lucas thompson that breaks news for us and he said that they just found out that china flew nuclear capable bombers over taiwan. again, that's

you are losing your job to china. it's china's fault. our bad trade deals with china so not surprising he is coming out of the blocks with statements on no better way than to then the chinese sanctity and control over taiwan. major domestic political issue in china. the population supports a one, china policy. taiwan is part of china, this reverberates with china. >> the islamic state has retaken the ancient city of palmyra, months after syrian government troops claimed a major vic against the terrorists. the united states state department cannot confirm it, that's really neither here nor there. excuse me. 'tis the season. opposition activists say isis has been rounding up people in palmyra. they cut of the heads of statues and the cities ruins are thousands and thousands of years ol'. the tear yosts appeared to have time their push for pal -- palmyra will the government has been working with aleppo. >> the former congressman excused of using tax dollars to decorate his office is heading to court. he claims the accusations are lies. his

the foreign ministry said the one china principle is the political bedrock for china u.s. relations if it is compromised or disputed, the sound and steady development of china relationship as well as other major issues would have out of the question. those words were obtained coming out of the state media. the state run news agency xinhua just posted a commentary titled principles not impulsiveness needed for china/u.s. ties and the global times, a communist party paper also described trump as naive like a child when it comes to foreign policy and a man who has no idea how dangerous his words can be. china considers a one china principle to be core to its interests, regarding taiwan. the u.s. recognized this principle since the 1970s and china just grisles at any suggestion that taiwan is an independent country instead of what beijing believes it to be, a rogue province. i spoke to one long time china analyst who said to me that it's not really such a bad idea for washington to take on a tougher line when it comes to beijing, however, he's concerned about what's a blunt mo

china relations. since that time china has accumulated a lot of foreign exchange and money and trade surplus and has used that to its benefit including military modernization. the leader when it normalization occurred in 1979 and lived until 1997 explicitly wanted to develop china economically for several decades before really moving to expand the military on a more modern and that's pretty much what has happened. you have to decide what you think about that. that's part of the narrative. of course we have had a lot of benefits. after you weigh the benefits of this normalization against the cost. certainly you would have to put on the column of benefit that if we look on the cold war we had two wars that involved china. korea and then vietnam for a very painful decade. china was involved directly in both of those wars. and since normalization whatever you want to inc. about other trends we haven't had conflict in asia. and that i count to be a big plus for everybody in asia including the united states

they called it the china dream. by 2049, they want the united states out of east asia and want to be the regional hegemon. they would prefer to do it peacefully. they want the united states to peacefully retrench and ithdraw and let the chinese be withdraw and let the chinese be the dominant power in asia as they have been for five millennia. between the opie moors of any 1840's and the chinese communist revolution, they want to restore what they think is their rightful place in the world. they are on a roll since 1979 in their economy following economic shifts in power like that. the modernization of the chinese military is incredible and incredibly fast. they want to do it peacefully, but they are preparing to do it violently if they need to. if you want to deter, there's a lot of diplomatic action but the baseline of deterrence is a strong, capable military, peace hrough strength. >> the only thing i would like o add is what the chairman said at lunch, i hope they understand what he is saying. i hope they have de

that adds to import prices for china. and those combined with additional pressure from domestic demand, that is what is pushing the producer prices up again. guy: what does it mean for the economy? manus: we get this data yesterday, so what is the consensus view in terms of momentum for china ? tom: i think the latest information day is another strong data for china paid we had strong export numbers from yesterday. and we had the pmi's, strong for november. indicate that their economy is going into the beginning of 2017 with a little bit of momentum. and with serious risks looming. the donald trump terrace -- tariff could kill the rally before it begins. the government is imposing controls when they start to bite, we will see the construction come down. that will take the heat out of commodity demand to push back down again. talk about --, what is the latest? have you been gambling? tom: only with my health. the story there is that there is a rumor in the hong kong press that the government is going to put a cap on atm wi

-china relations may look like. rishaad: what could be driving banks to invest in the $100 million investment fund. this is bloomberg. ♪ >> a quick check of the business flash headlines. the accounting firm in charge of due diligence over the bank [indiscernible] id value is estimated at $1.5 billion. shares touched a record low on monday. .ow down 11.25% in seoul rishaad: jeff bezos has been a vocal critic of donald trump. he is attending wednesday's gathering of tech leaders called by the president-elect. elon musk and sherry sandberg and larry page will be there. may hope to find some common ground. >> there is a couple of things that are pretty important potential changes that we could see in the corporate finance arena for us. the first is a shift on repatriation of foreign earnings and that is government permanent solution, not a tax holiday. we would be hit -- very happy with it. that would give us more about,lity and we talk it gives us flexibility across m&a and dividends, across buybacks. and then there