WEBVTT - China's Chip Sector Rally and Amazon's RTO 0:00:02.440 --> 0:00:10.039 Bloomberg Audio Studios, podcasts, radio news from Mahard. We're Innovation 0:00:10.160 --> 0:00:13.800 of Money and Power Collie in Silicon Valley NBN. 0:00:14.160 --> 0:00:18.680 This is Bloomberg Technology with Caroline Hyde and Ed Ludlow. 0:00:31.760 --> 0:00:33.199 Live from New York and San Francisco. 0:00:33.440 --> 0:00:36.760 This is Bloomberg Technology coming up China's chip sectors. He's 0:00:36.800 --> 0:00:39.720 a thirteen million dollar rally. We discussed the bets on 0:00:39.800 --> 0:00:41.400 Beijing stimulus. 0:00:41.600 --> 0:00:44.760 And Amazon's leaders pushed for a return to offices to 0:00:44.880 --> 0:00:47.040 protect the tech giants. 0:00:46.680 --> 0:00:50.760 Culture and a US infrastructure hack American water works. The 0:00:50.880 --> 0:00:54.480 latest target is officials warn of threats from Iran and China. 0:00:54.920 --> 0:00:57.200 But first we turn to our top story on. 0:00:57.200 --> 0:01:00.360 The markets, which is this Chinese chip maker Semi Conductive 0:01:00.360 --> 0:01:05.200 Manufacturing International SMICK leading that thirteen billion dollars sector rally 0:01:05.280 --> 0:01:09.039 after global investors, but that Beijing will declare more policy 0:01:09.120 --> 0:01:11.880 or financial support for the industry that is central to 0:01:11.959 --> 0:01:13.400 its geopolitical ambitions. 0:01:13.560 --> 0:01:15.520 It makes Emeni Grafeo Jones us for more. 0:01:15.600 --> 0:01:15.800 Look. 0:01:15.800 --> 0:01:18.360 Smick is blacknisted for US investors, but this is a 0:01:18.440 --> 0:01:20.680 broad rally in the chip sector over in China. 0:01:20.760 --> 0:01:24.240 This is it's not just SMIC that's rallying but that 0:01:24.319 --> 0:01:27.920 stock is up over twenty eight percent just on the day, 0:01:28.040 --> 0:01:30.200 up about sixty five percent in the. 0:01:30.240 --> 0:01:31.160 Last few days. 0:01:31.160 --> 0:01:33.000 And these are shares that have been trading in Hong 0:01:33.080 --> 0:01:36.320 Kong because the stock market actually in the mainland China 0:01:36.319 --> 0:01:39.640 has been closed all week for the holiday. So there's 0:01:39.640 --> 0:01:43.399 a lot of anticipation that when the Chinese stock market opens, 0:01:43.880 --> 0:01:46.759 I guess tonight for us in the US, but tomorrow morning, 0:01:46.760 --> 0:01:49.200 Tuesday morning in China, that there's going to be a 0:01:49.240 --> 0:01:51.960 florry of bets. So we're seeing now traders kind of 0:01:51.960 --> 0:01:56.080 getting ahead of that. Smaller competitive competitors in the chips 0:01:56.120 --> 0:01:57.200 fake space are. 0:01:57.120 --> 0:01:58.080 Also up as well. 0:01:58.160 --> 0:02:03.200 Hua Hoang Semiconductor up something like seventeen percent right now. 0:02:04.520 --> 0:02:06.840 Investors think that the Chinese government is going to have 0:02:06.920 --> 0:02:11.200 some kind of semiconductor industry specific stimulus. Right, But if 0:02:11.200 --> 0:02:14.400 you look at the Chinese equity market since kind of 0:02:14.480 --> 0:02:18.080 late September, things have been improving. Give us the bigger 0:02:18.120 --> 0:02:21.280 picture of this performance relative to I guess US tech 0:02:21.360 --> 0:02:23.560 or European tech so far in twenty four. 0:02:23.919 --> 0:02:26.680 Well, I mean the bigger picture performance is that Chinese 0:02:26.680 --> 0:02:29.799 stocks overall have pretty much been in a bear market 0:02:30.000 --> 0:02:33.120 since about February of twenty twenty one. So although we've 0:02:33.160 --> 0:02:37.320 seen big gains since late September, when, like you said, 0:02:37.560 --> 0:02:42.120 Beijing did announce fiscal and monetary stimulus, we're still down 0:02:42.600 --> 0:02:44.680 for the year in a lot of these areas. And 0:02:44.680 --> 0:02:47.760 that's right. It's really a big question here what exactly 0:02:47.840 --> 0:02:50.680 are we going to get from China when they do 0:02:50.800 --> 0:02:54.480 have that press conference later tonight tomorrow morning in China 0:02:55.040 --> 0:02:57.359 and when the stock market reopens. There was a note 0:02:57.400 --> 0:03:01.000 from analyst Brent Donnelley and the line of his email 0:03:01.080 --> 0:03:03.160 was China, China, China, China. 0:03:03.600 --> 0:03:04.760 And then he has a point. 0:03:05.040 --> 0:03:07.440 Yeah, he has a point, And his note he said, 0:03:07.480 --> 0:03:09.760 how big is a stimulus? Will they even tell us? 0:03:09.919 --> 0:03:12.400 Tonight's China reopening is likely to be spicy, So there's 0:03:12.440 --> 0:03:14.720 a lot of questions about is the government actually going 0:03:14.720 --> 0:03:18.920 to pledge specifically to add stimulus to the semiconductor sector. 0:03:19.160 --> 0:03:21.000 But the bet here in the market right now is 0:03:21.040 --> 0:03:21.560 that they will. 0:03:21.800 --> 0:03:24.760 And also, look, this has been a long hated area. 0:03:25.000 --> 0:03:28.840 More broadly, positioning has not been long China and indeed 0:03:28.919 --> 0:03:30.640 China techno broadly because people have. 0:03:30.639 --> 0:03:32.560 Gotten burned by it in the last two years. 0:03:32.680 --> 0:03:35.400 Anyone who's gotten in, like I said back in twenty 0:03:35.440 --> 0:03:38.520 twenty one, is actually still in negative territory. We are 0:03:38.640 --> 0:03:42.360 seeing sentiment start to I guess, come around as one 0:03:42.400 --> 0:03:46.000 would expect, the stock market goes up, ETF flows follow 0:03:46.120 --> 0:03:48.360 So in just the last week we saw about six 0:03:48.400 --> 0:03:53.480 billion dollars flowing into US listed China ETF. So even 0:03:53.600 --> 0:03:56.560 you know, across the globe, investors are trying to get 0:03:56.560 --> 0:03:58.600 in or at least play the momentum right now. 0:04:00.160 --> 0:04:03.120 Ex Emily Graffair with the reporting on the market moves 0:04:03.200 --> 0:04:05.640 on China tech. Let's discuss a bit more with Janetarly, 0:04:06.000 --> 0:04:10.520 head of market analysis at RBC Brewin Dolphin and your reaction, Janet, 0:04:10.640 --> 0:04:14.800 was to upgrade your call on in the exuities context 0:04:14.960 --> 0:04:19.320 on Asia ex Japan. When you're weighing up the factors 0:04:19.360 --> 0:04:21.760 in the context of China tech, what were the things 0:04:21.760 --> 0:04:24.880 that you were looking at short, medium and long term. 0:04:26.040 --> 0:04:26.839 Thanks for having me. 0:04:27.000 --> 0:04:30.719 I think we have been skeptical on China, as many 0:04:30.760 --> 0:04:34.480 people are, but I think is really how undervalued China 0:04:34.480 --> 0:04:37.960 has been versus say the US or other development markets, 0:04:38.120 --> 0:04:40.160 and also the fact that position. 0:04:39.960 --> 0:04:40.800 Has been very light. 0:04:40.960 --> 0:04:43.200 I mean for US, we have been underweight for quite 0:04:43.240 --> 0:04:47.880 a sustained period of time, so I think that is shifting. 0:04:47.960 --> 0:04:50.720 And I think your Chinese market is a very momentum 0:04:50.800 --> 0:04:54.279 driven and very liquiditive driven, so we have seen both 0:04:54.640 --> 0:04:57.440 happening and I think we would like to participate in 0:04:57.480 --> 0:04:58.040 this rally. 0:04:58.080 --> 0:04:59.800 This probably has more to go. 0:05:00.320 --> 0:05:03.159 And in terms of Chinese tech, I mean obviously undervalued, 0:05:03.560 --> 0:05:08.440 very unloved versus the US counterpars part. Obviously they're they're different, 0:05:09.040 --> 0:05:12.760 but still we think that there is still much upside 0:05:12.760 --> 0:05:15.520 potential from here. But haven't said that we I mean 0:05:15.640 --> 0:05:18.440 we just upgraded modestly. I think there's still a lot 0:05:18.440 --> 0:05:22.000 of question mark for the longer term. 0:05:22.160 --> 0:05:26.480 Emily's reporting just in that conversation was largely about some 0:05:26.520 --> 0:05:29.680 of the domestic chip names in China. What's your attitude 0:05:29.680 --> 0:05:34.520 towards the semiconductor sector in mainland China? 0:05:35.640 --> 0:05:38.960 Yes, I think it is obviously a very state supporter 0:05:39.160 --> 0:05:43.440 sector has been for a while long term wise, so 0:05:43.680 --> 0:05:46.599 I think it makes sense for investors who favor this 0:05:46.720 --> 0:05:51.200 sector given basically I think the new tech, the semiconductor 0:05:51.360 --> 0:05:55.600 strategic areas of uh, you know those equities have you know, 0:05:55.680 --> 0:05:59.400 it should do well given how important that is. But 0:05:59.520 --> 0:06:02.680 ultimately we have to understand that a lot of developed 0:06:02.839 --> 0:06:08.159 economies are likely to steal being skeptical, and you know, 0:06:08.240 --> 0:06:11.720 have restrictions of all sorts of those companies products. 0:06:12.000 --> 0:06:14.920 So I would say I would participate in the rally. 0:06:15.000 --> 0:06:17.279 I do think that it has further to go, but 0:06:17.440 --> 0:06:20.040 I would be a bit more cautious over a longer term, 0:06:21.040 --> 0:06:24.520 and we have to kind of understand where to take 0:06:24.560 --> 0:06:26.839 profits when when it is necessary. 0:06:27.680 --> 0:06:30.640 To that point, Janet, do you think that people are 0:06:30.640 --> 0:06:32.760 protecting to the downside enough? Do we think a lot 0:06:32.760 --> 0:06:34.279 of people are going to get burned once again? 0:06:37.160 --> 0:06:39.400 I mean, it is potentially possible. 0:06:39.440 --> 0:06:41.480 We have seen that play out before in the previous 0:06:41.760 --> 0:06:44.920 bull market cycle and then a very sharp band market 0:06:45.040 --> 0:06:47.839 in China. We have seen that play out again again. 0:06:47.880 --> 0:06:50.760 But I think I think it could last for quite 0:06:50.800 --> 0:06:53.600 a bit. As I said, given how light the positioning, 0:06:53.680 --> 0:06:58.520 how underweight it is for global investors, So I would 0:06:58.520 --> 0:07:01.280 say it could have further to run in the next 0:07:02.160 --> 0:07:03.440 a couple of months at least. 0:07:03.480 --> 0:07:03.919 I think. 0:07:04.120 --> 0:07:06.320 I think the Chinese bodies, their heads are tied. They 0:07:06.320 --> 0:07:08.600 would just have to provide more stillables. But you're right, 0:07:08.640 --> 0:07:11.480 there is absolutely a chance for some investors to get burned, 0:07:11.760 --> 0:07:12.240 So that's. 0:07:12.080 --> 0:07:13.880 Why we had to auditor it very closely. 0:07:14.120 --> 0:07:16.840 What's been interesting is there's been institutional money flowing in 0:07:16.960 --> 0:07:19.840 David Tepper saying how much he's liking China and also retail. 0:07:20.040 --> 0:07:21.880 I want to get your check just more broadly on 0:07:22.320 --> 0:07:28.080 sentiment towards semiconductors globally technology globally. Where are we seeing 0:07:28.080 --> 0:07:30.920 the optimism still in institutional money or is it now 0:07:31.120 --> 0:07:36.800 sort of retail and we question there for the longevity, I. 0:07:36.760 --> 0:07:40.119 Think well, I think for US, for example, we still 0:07:40.160 --> 0:07:44.240 like the global semiconductor sector. Obviously that's mostly US Clay, 0:07:45.520 --> 0:07:49.560 so I think there's a lot of structural supportive drivers 0:07:49.600 --> 0:07:51.960 behind that. We are very happy to get exposure to 0:07:52.000 --> 0:07:53.480 those high quality companies. 0:07:53.760 --> 0:07:54.600 But I think for. 0:07:54.600 --> 0:07:58.600 Institutions, I think it will be very dangerous if you 0:07:59.200 --> 0:08:03.360 don't participate in the semiconductor That AI related theme, I 0:08:03.440 --> 0:08:06.960 think what retail investors is. I think once the momentum 0:08:07.280 --> 0:08:11.080 is back, I think that would draw in more participation. Basically, 0:08:11.200 --> 0:08:15.680 as interest rates are being cut, the economy continues to expand, 0:08:15.880 --> 0:08:19.240 and hopefully let's bad news out there on the headlines, 0:08:19.280 --> 0:08:20.520 I think that that could help. 0:08:20.640 --> 0:08:22.600 Although we still like the setter pretty much. 0:08:22.600 --> 0:08:27.560 We have stayed invested and we continue to encourage investors 0:08:27.640 --> 0:08:31.520 to add in more money when valuations have turned attractive 0:08:31.640 --> 0:08:32.959 of say the past couple. 0:08:32.800 --> 0:08:36.000 Of months, Janet, when you got to your desk this 0:08:36.160 --> 0:08:40.520 morning in London, how big a factor risk was trade 0:08:40.640 --> 0:08:45.200 risk or supply chain risk for technology investors around the world. 0:08:48.240 --> 0:08:51.719 Obviously, it is part of the consideration given that you know, 0:08:51.800 --> 0:08:54.320 the cheap industry is very you know, the supply chain 0:08:54.400 --> 0:08:58.479 is very complicated, and if there's well widespread trade productionism 0:08:59.559 --> 0:09:01.480 then obviously that's not great. 0:09:01.640 --> 0:09:03.960 But fundamentally the demand is still very strong. 0:09:04.480 --> 0:09:07.320 And I think what we are a bit more reassured 0:09:07.400 --> 0:09:10.000 now is that if you look at the polls and 0:09:10.120 --> 0:09:15.640 the the probability of Trump winning the election by betting market, 0:09:15.720 --> 0:09:18.000 it has gone down. Obviously it is a very tight race, 0:09:18.080 --> 0:09:20.400 but it gives us a bit of comfort to be 0:09:20.600 --> 0:09:24.520 a bit more positive on the China equity story and 0:09:24.960 --> 0:09:28.439 also the global semiconductory part. But I think ultimately fundamentally 0:09:28.640 --> 0:09:31.880 is about the demand the long term build up of 0:09:31.960 --> 0:09:36.319 AI infrastructure and how strategically important that sector is for 0:09:37.000 --> 0:09:38.200 many sovereigns. 0:09:37.760 --> 0:09:40.240 Out there, Jennet, how important therefore, when you sat down 0:09:40.400 --> 0:09:42.640 was the four percent number on the tenure yield in 0:09:42.760 --> 0:09:48.480 that macro context for these AI bets, Well. 0:09:48.600 --> 0:09:50.280 The thing is, yeah, we saw you go back to 0:09:50.360 --> 0:09:50.880 four percent. 0:09:51.120 --> 0:09:54.400 I think some small to meet cap stocks could be 0:09:55.000 --> 0:09:57.880 struggling a little bit today, but we still see some 0:09:58.000 --> 0:10:02.360 of the key semiconductor stocks right. Obviously it's very company specific, 0:10:02.720 --> 0:10:06.680 but what we think is, you know, ah, I think, yeah, 0:10:06.679 --> 0:10:10.000 astrong economy, good job market hair Outomley is good for 0:10:10.240 --> 0:10:13.319 the world economy, for the US, for corporate earnings, et cetera. 0:10:13.720 --> 0:10:16.840 I wouldn't look too much into this one day move 0:10:17.160 --> 0:10:20.120 for equities. If they're down or struggling a little bit, 0:10:20.240 --> 0:10:23.079 I will still be quite comfortable to be overweight in 0:10:23.360 --> 0:10:25.720 the US and in the usmiconductor space. 0:10:26.080 --> 0:10:28.680 Chanit mely love having you on head of market analysis 0:10:28.720 --> 0:10:29.880 at LBC Brew and Dolphin. 0:10:29.960 --> 0:10:30.240 Thank you. 0:10:30.920 --> 0:10:34.680 Now coming up, US water infrastructure is under attack. More 0:10:34.720 --> 0:10:38.439 on the latest cyber attack on American water Works. This 0:10:38.520 --> 0:10:52.320 is blue Big Technology. American water Works says it's computer 0:10:52.440 --> 0:10:53.800 networks and systems were hacked. 0:10:53.880 --> 0:10:55.280 Now the New Jersey based company. 0:10:55.080 --> 0:10:59.480 Which supplies drinking water and wastewater services to fourteen million people, 0:11:00.000 --> 0:11:02.920 So that parts of its systems were disconnected or deactivated 0:11:03.160 --> 0:11:05.480 as they worked to contain the cyber attack. From more 0:11:05.480 --> 0:11:08.320 of Bloomberg's Jordan Robertson joins US, Now, we've had warnings 0:11:08.760 --> 0:11:12.959 from governments about this How much how broad is this 0:11:13.040 --> 0:11:14.719 attack from real perspective, Jordan. 0:11:15.480 --> 0:11:18.240 Yeah, thanks for having me. So, this company that was 0:11:18.280 --> 0:11:22.000 breached is the biggest publicly traded water and wastewater company 0:11:22.080 --> 0:11:25.360 in the US. As you mentioned, it serves some fourteen 0:11:25.480 --> 0:11:28.680 million customers across half of the states in the US. 0:11:29.280 --> 0:11:31.719 It's potentially a very big deal, you know. Unfortunately, we 0:11:31.760 --> 0:11:34.280 don't have a lot of details or specifics about this 0:11:34.440 --> 0:11:37.160 particular attack. We just know what the company is disclosed 0:11:37.720 --> 0:11:40.480 this morning in a regulatory filing, which is that a 0:11:40.559 --> 0:11:43.280 victim of a cyber attack, and that it's disconnected or 0:11:43.320 --> 0:11:45.640 deactivated some of its systems. We don't have a lot 0:11:45.679 --> 0:11:47.839 of specifics about the actual attack, but we do have 0:11:47.920 --> 0:11:51.679 a lot of context around attacks against water treatment and 0:11:51.800 --> 0:11:54.840 water facilities in general, which is that the US government 0:11:54.920 --> 0:11:58.880 has been advising for months, in particular that Chinese groups 0:11:59.559 --> 0:12:04.360 have been infiltrating US water systems. Impossible kind of preparation 0:12:04.720 --> 0:12:07.920 for more disruptive attacks. Now, we don't know if this 0:12:08.080 --> 0:12:09.679 is one of those, or if this is some other 0:12:09.800 --> 0:12:12.839 type of breach, but given the context and given the 0:12:12.920 --> 0:12:16.079 size of this water company, it's potentially a very big deal. 0:12:16.800 --> 0:12:17.800 Can you give us the context? 0:12:17.840 --> 0:12:20.679 As well as the US accusing the China linkt tackers 0:12:20.720 --> 0:12:24.280 of infiltrating networks that operate as well critical US services. 0:12:24.320 --> 0:12:25.800 We've got reports in the Wall Street. 0:12:25.600 --> 0:12:30.679 Journal on Friday about potentially an attack on well providers 0:12:30.760 --> 0:12:34.360 of Internet of Wireless, but also of US BORBA more broadly. 0:12:35.360 --> 0:12:37.400 Yeah, what's happening now is a little bit different than 0:12:37.480 --> 0:12:40.400 what's happened in previous years with regard to Chinese hacking. 0:12:40.640 --> 0:12:41.600 You know, for many, many. 0:12:41.520 --> 0:12:44.720 Years, the US government has issued warnings about Chinese hacking 0:12:44.800 --> 0:12:48.719 for economic espionage, so industrial espionage purposes, and also just 0:12:49.160 --> 0:12:53.520 regular espionage, you know, spying on government agencies and military 0:12:53.559 --> 0:12:55.960 contractors and things like that. But what the government has 0:12:56.000 --> 0:12:59.840 been warning a while about now is that there are 0:13:00.080 --> 0:13:03.960 using Chinese hackers, particularly a group called volt Typhoon, which 0:13:04.000 --> 0:13:07.319 is the name that cybersecurity professionals have given them of 0:13:07.520 --> 0:13:11.520 kind of pre positioning themselves inside critical networks to conduct 0:13:11.600 --> 0:13:15.640 potentially disruptive attacks at some predetermined point in the future. 0:13:16.120 --> 0:13:19.079 In the military, they call this kind of preparing the 0:13:19.160 --> 0:13:22.760 battle space. That's a very different type of attack than 0:13:22.800 --> 0:13:25.200 we've seen in the past from some of these Chinese groups. 0:13:25.400 --> 0:13:27.400 So that's what the US government has been warning about. 0:13:27.480 --> 0:13:30.079 Again in this case, we don't know yet if this 0:13:30.240 --> 0:13:32.760 is related to these Chinese attacks at all, or if 0:13:32.800 --> 0:13:36.360 it's something else, potentially like ransomware. But given that context, 0:13:36.400 --> 0:13:38.400 and given that the US government is really ringing the 0:13:38.480 --> 0:13:42.640 bell and really raising the alarm about these Chinese attacks, 0:13:43.480 --> 0:13:45.800 it bears paying pretty close attention to this incident to 0:13:45.800 --> 0:13:47.360 see if there's something deeper involved. 0:13:48.320 --> 0:13:51.320 Jordan, you're deep on the cybersecurity beat, right, and there's 0:13:51.360 --> 0:13:53.760 going to be a section of our Bloomberg Technology audience 0:13:53.800 --> 0:13:58.079 around the world that go, they're attacking water infrastructure. So 0:13:58.200 --> 0:14:02.240 speak a little bit more about that water infrastructure and 0:14:02.360 --> 0:14:05.000 do we have any reporting on sort of the competence 0:14:05.520 --> 0:14:08.520 of US companies and US government to defend against it. 0:14:09.600 --> 0:14:12.080 Yeah, to answer your first question, why attack water companies? 0:14:12.120 --> 0:14:14.680 You know we saw with the attack on Colonial pipeline 0:14:14.720 --> 0:14:17.160 several years ago that you know, you don't have to 0:14:17.240 --> 0:14:22.280 attack an actual pipeline to disrupt the to disrupt critical systems, 0:14:22.360 --> 0:14:24.840 you know, whether in the US or elsewhere, you only 0:14:24.920 --> 0:14:27.120 have to disrupt their IT systems. In the case of 0:14:27.200 --> 0:14:31.000 Colonial Pipeline, which you know, disrupted gasoline shipments across the 0:14:31.200 --> 0:14:34.760 entire Eastern US, it was their IT system. There's a 0:14:34.840 --> 0:14:38.240 billing system that went down as a result of ransomware attacks. 0:14:38.640 --> 0:14:40.440 So there's a lot of damage and a lot of 0:14:40.520 --> 0:14:44.560 disruption that hackers can do by simply disrupting even just 0:14:44.640 --> 0:14:48.240 the IT systems of some of these critical infrastructure providers, 0:14:48.320 --> 0:14:52.440 whether that's electricity providers, whether it's water providers, you know, 0:14:52.560 --> 0:14:55.440 kind of whether it's gasoline shipment companies and pipeline operators. 0:14:55.720 --> 0:14:59.040 So there's potentially a very great advantage that a foreign 0:14:59.120 --> 0:15:02.040 nation would have could have, you know, if they decided 0:15:02.040 --> 0:15:04.760 to disrupt in that way. And with regard to the 0:15:04.880 --> 0:15:09.240 competence of critical infrastructure providers, We've done a lot of reporting. 0:15:09.320 --> 0:15:11.360 The cyber team A Bloomberg's got a lot of reporting 0:15:11.440 --> 0:15:13.600 on this topic. And the answer to your question is 0:15:13.720 --> 0:15:17.240 it varies. You know, the largest companies, the largest electricity 0:15:17.320 --> 0:15:20.800 suppliers in particular, tend to be pretty good at cybersecurity. 0:15:20.800 --> 0:15:21.680 They've gotten the message. 0:15:21.680 --> 0:15:22.680 They've got big budgets. 0:15:23.200 --> 0:15:25.000 But as you go down that ladder, and you go 0:15:25.080 --> 0:15:27.800 down the ladder of resources in particular, you know, it 0:15:28.000 --> 0:15:31.200 really just varies. There are some very large, critical infrastructure 0:15:31.240 --> 0:15:35.080 providers that are just not as great at protection as others. 0:15:36.000 --> 0:15:39.640 Blombergs Jordan Robinson were grateful for that reporting, Thank you. Meanwhile, 0:15:40.080 --> 0:15:43.240 Ukrainian hackers say they carried out a cyber attack that 0:15:43.440 --> 0:15:48.040 took down online broadcasts of Russian state TV and radio channels. 0:15:48.200 --> 0:15:52.240 According to officials in Kiev, at least twenty Russian broadcasters 0:15:52.440 --> 0:15:56.680 were affected, though claims could not be verified by Bloomberg News. 0:15:56.760 --> 0:16:00.040 The disruptions to the broadcasts coincided with Russian present in 0:16:00.120 --> 0:16:04.240 Vladimir Putin's seventy second birthday Caroline. 0:16:04.440 --> 0:16:07.400 Back in the US, ed State, local officials across the 0:16:07.440 --> 0:16:10.080 country are bracing for a range of possible disruptions, including 0:16:10.160 --> 0:16:13.480 cyber attacks as well as disinformation on ruly crowds, even 0:16:13.520 --> 0:16:16.080 ahead of the US elections next month. We're want to 0:16:16.120 --> 0:16:18.840 dig into that with Bloomberg's Jamie Tarabay joining us. You 0:16:18.920 --> 0:16:22.040 went to Arizona. You are focusing on really the computer 0:16:22.160 --> 0:16:25.760 systems in particular around voting in Arizona. 0:16:25.880 --> 0:16:26.840 Why remind us. 0:16:28.360 --> 0:16:31.520 Well, Arizona four years ago was the scene of one 0:16:31.560 --> 0:16:34.320 of the biggest flash points in the twenty twenty election. 0:16:34.960 --> 0:16:37.520 There is an aspect to what they did at the 0:16:37.640 --> 0:16:40.640 time that they really learned from going forward. And one 0:16:40.640 --> 0:16:42.240 of the first things that they did was look at 0:16:42.280 --> 0:16:45.800 physical security as well as cybersecurity. Of fence went up 0:16:45.840 --> 0:16:48.720 to protect the workers inside, and then they began this 0:16:48.880 --> 0:16:52.880 system of trying to reach for utmost transparency. There's a 0:16:52.960 --> 0:16:55.720 twenty four hour livestream camera that actually doesn't even have 0:16:55.840 --> 0:17:00.280 to work outside of election season, and that is going 0:17:00.520 --> 0:17:03.720 three sixty five days a year, twenty four hours a day, 0:17:03.760 --> 0:17:04.560 seven days a week. 0:17:05.280 --> 0:17:06.760 They are inviting people. 0:17:06.640 --> 0:17:09.359 To come to tour to look at all of the 0:17:09.520 --> 0:17:13.960 computer systems to see that everything is serialized, everything is audited, 0:17:14.080 --> 0:17:16.960 everything is tracked. All the networks are air gap so 0:17:17.000 --> 0:17:20.520 they're not actually connected to the internet. Whatever ways people 0:17:20.680 --> 0:17:23.639 might think that there's a possibility that an election or 0:17:23.720 --> 0:17:26.720 that their vote could be hacked, the people in Arizona 0:17:26.840 --> 0:17:30.560 are doing their utmost to really push back and try 0:17:30.640 --> 0:17:33.159 to dispute a lot of those conspiracy theories. 0:17:34.320 --> 0:17:37.600 Jamie four years ago, I was there posted on the 0:17:37.640 --> 0:17:40.760 election trail in Maricoba County, and I think it's worth 0:17:40.920 --> 0:17:44.160 just discussing the basics of what we're talking about. It's 0:17:44.200 --> 0:17:48.080 a building, it has windows and bricks and mortar, and 0:17:48.200 --> 0:17:52.359 they're making modifications to it because inside that building they'll 0:17:52.440 --> 0:17:55.399 count votes. Take it from there and run with the 0:17:55.480 --> 0:17:56.520 rest of the story. 0:17:57.880 --> 0:18:00.960 To go into this building now and as you said, 0:18:01.000 --> 0:18:04.760 four years ago, we literally the conspiracy theorist Alex Jones 0:18:04.800 --> 0:18:07.080 made it into the building. A couple of days later, 0:18:07.320 --> 0:18:09.440 one of the people who was a protester in the 0:18:09.520 --> 0:18:13.240 January sixth attack on the Capitol was in the parking lot. 0:18:13.600 --> 0:18:16.840 Heavily armed people were in the parking lot. And now 0:18:16.960 --> 0:18:19.879 you cannot get in there without access without a security clearance. 0:18:20.040 --> 0:18:22.320 The room that where all. 0:18:22.280 --> 0:18:25.800 The ballots are tabulated is a place where you can 0:18:25.880 --> 0:18:29.159 only go in if you have security clearance. Every single 0:18:30.080 --> 0:18:34.000 every single machine is audited and tracked and checked. They 0:18:34.080 --> 0:18:37.359 have literally done everything they can to get ahead of 0:18:37.720 --> 0:18:44.919 any possible question about any irregularities or any redundancies. I mean, 0:18:44.960 --> 0:18:47.640 there's a machine that go that sifts through the ballots, 0:18:47.640 --> 0:18:50.680 and if one of those ballots ways just a little 0:18:50.720 --> 0:18:51.560 bit different. 0:18:51.280 --> 0:18:51.760 To the rest. 0:18:51.840 --> 0:18:56.680 They basically will you get rid of They'll cancel out 0:18:56.680 --> 0:18:59.000 the batch two hundred before and two hundred after. 0:18:59.080 --> 0:19:00.679 They're really doing everything they can. 0:19:00.800 --> 0:19:05.560 Here Bloomberg's Jamie Taraba terrific reporting. Thank you very much. 0:19:13.440 --> 0:19:15.640 This is a first look inside the world's first humanoid 0:19:15.760 --> 0:19:18.560 robot assembly plant. It's a work in progress. Here Agility 0:19:18.680 --> 0:19:20.800 Robotics is going to manufacture digit in a teal and 0:19:20.840 --> 0:19:22.960 middle gray bot that walks like a bird. It's sneeze 0:19:23.000 --> 0:19:24.960 beIN backwards, and it is designed to work at first 0:19:25.000 --> 0:19:28.560 anyway at warehouses, including at Amazon and Gxologistics. The factory 0:19:28.600 --> 0:19:31.200 is on Marshy, former agricultural land on the outskirts of Salem, 0:19:31.280 --> 0:19:33.760 Oregon's capital, not the robotics hotspot, but it is up 0:19:33.760 --> 0:19:36.240 the road from Corvallis, an Oregon State university where Jonathan 0:19:36.280 --> 0:19:38.720 Hurst Robotics, the professor, co founded Agility, and of course 0:19:38.760 --> 0:19:41.359 there is an Amazon warehouse nearby. Agilly's first design was 0:19:41.359 --> 0:19:44.399 a monopod called Thumper. Later in more sophisticated bots have 0:19:44.560 --> 0:19:46.240 arms and a head unit for sensors, making them a 0:19:46.240 --> 0:19:49.159 little less creepy. At this facility, Agility simulates work its 0:19:49.160 --> 0:19:51.399 spots are already doing for clients, stacking tote bins at 0:19:51.440 --> 0:19:53.560 Amazon and placing bins on conveyor belts in the case 0:19:53.600 --> 0:19:55.879 of GXO. While I was watching one Digit tried to 0:19:55.920 --> 0:19:57.399 place a stack of bins on top of another, but 0:19:57.560 --> 0:19:59.120 was off by a small margin, so the new bins 0:19:59.160 --> 0:20:01.560 SATIS kew pass and watch for a few seconds. As 0:20:01.600 --> 0:20:03.280 a software tried to figure out what to do, it 0:20:03.359 --> 0:20:06.360 gave up. Other times it was seamless. Digits, communications systems, 0:20:06.400 --> 0:20:08.200 and for sensors live in its head unit, and first 0:20:08.240 --> 0:20:10.400 Agility didn't put heads on the robots. The team started 0:20:10.440 --> 0:20:11.840 with the goal of building bots able to move in 0:20:11.880 --> 0:20:14.200 human spaces, not ones that looked like us Digit does 0:20:14.200 --> 0:20:16.920 and fingers. Agility's first Digit model started with black paddles 0:20:17.000 --> 0:20:19.040 capable of lifting totes, and they're adding other end of 0:20:19.200 --> 0:20:21.240 arm devices. The company hopes this building will be able 0:20:21.280 --> 0:20:23.040 to churn out ten thousand robots a year. If we 0:20:23.080 --> 0:20:24.720 could doing there, we'll take a while. Engineers are still 0:20:24.760 --> 0:20:27.640 documenting assembly processors, figuring out what tools should go where 0:20:27.680 --> 0:20:30.080 before they can start mass hiring technicians to assemble the bots. 0:20:30.119 --> 0:20:32.200 The first robot assembled year one of Digit's new fourth 0:20:32.280 --> 0:20:33.960 version will be completed sometime this month. 0:20:34.880 --> 0:20:38.400 Talking of Amazon, a rare analyst downgrade citing concerns over 0:20:38.440 --> 0:20:41.399 the company's margin trends into next year, saying growth in 0:20:41.440 --> 0:20:44.639 the cloud computing business is unlikely to help much, Whilst 0:20:44.640 --> 0:20:47.040 Fargo Securities cut the stock to equal way from overweight 0:20:47.080 --> 0:20:49.120 and cut a price target from two hundred and twenty 0:20:49.160 --> 0:20:51.280 five to one hundred and eighty three dollars, one of 0:20:51.320 --> 0:20:52.280 the lowest on Wall Street. 0:20:52.400 --> 0:20:53.360 ED will have more on that later. 0:20:54.119 --> 0:20:57.440 Yeah, Amazon, which recently decided to bring corporate employees back 0:20:57.440 --> 0:21:01.280 to the office full time, honoring Bloomberg Spencer. SIP sources 0:21:01.320 --> 0:21:03.760 are telling us that there's a reason for that, and 0:21:03.840 --> 0:21:06.280 the reason is culture. Explain that. 0:21:08.080 --> 0:21:11.280 Yeah, so Jesse is saying CEO Andy Jasse is saying 0:21:11.320 --> 0:21:16.800 that new hires, and remember Amazon doubled in size to 0:21:16.920 --> 0:21:20.840