the aim is to reinforce china's claim to the whole of the south china sea. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. but as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. now to evidence of a startling rise in gun violence the us, including in barack obama's hometown of chicago. killings in the city have reached a 20—year high. a deadly summer of violence brought this year's death toll to 500. most of the victims and their killers were young men. we spent a week in chicago and found a world where guns rule. a world where guns and gangs rule. in my neighbourhood, they start young. that is the edge, and they are dying from guns. very young. we have to teach children how to defend themselves. it is like, what do you do? you are caught in the moment. you would rather be caught with protection than without it. i have never seen so many guns. like, we have so many guns. but i ha

taiwan and island building in south china sea. this was triggered after yesterday's developments that dozens of ships and aircraft were and continue to be used for this massive exercise that supposedly wrapped up in the china's northeast. that's the northeast area of that region. how close that is to military islands, i don't know. but now u.s. drone and unmanned drone of sort of an underwater drone, if you will, taken by the chinese and things are escalating. that my friends is what people call international incident at the worst of times. more after this ♪ ♪ ♪ ♪ how else do you think he gets around so fast? take the reins this holiday and get the mercedes-benz you've always wanted during the winter event. now lease the 2017 gle350 for $579 a month at your local mercedes-benz dealer. neil: a little bit more on the chinese situation here. we have apparently demanded the chinese turn over this navy unmanned underwater glider that was picked up by the chinese in the south china sea. chinese have not responded to that. they h

the aim is to reinforce china's claim to the whole of the south china sea. america and its allies are now responding. and over the radio we now hear one of them. what we're hearing is an australian military aircraft asserting freedom of passage. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. and as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. from the conflict in syria to what's seen as the forgotten war in yemen. the fighting there has pushed one of the poorest countries in the middle east to the brink of famine, threatening the lives of millions of people. more than 7,000 have been killed in the conflict between the country's houthi rebels, who overthrew the government last year, and a saudi—led coalition backed by britain and the us. this has left around 7 million people on the brink of famine, many of them children. and again a warning, nawal al—maghafi's report contain

the aim is to reinforce china's claim to the whole of the south china sea. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. and as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. now to evidence of a startling rise in gun violence the us, including in barack 0bama's hometown of chicago. killings in the city have reached a 20—year high. a deadly summer of violence brought this year's death toll to 500. most of the victims and their killers were young men. we spent a week in chicago and found a world where guns rule. in my neighbourhood, they start young. that is the edge, and they are dying from guns. very young. we have to teach children how to defend themselves. it is like, what do you do? you would rather be caught with protection than without it. i have never seen so many guns. like, we have so many guns. but i have never seen as many as now. bo deal is a rapper from the west s

the aim is to reinforce china's claim to the whole of the south china sea. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. and as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. now to evidence of a startling rise in gun violence the us, including in barack 0bama's hometown of chicago. killings in the city have reached a 20—year high. a deadly summer of violence brought this year's death toll to 500. most of the victims and their killers were young men. we spent a week in chicago and found a world where guns rule. in my neighbourhood, they start young. that is the edge, and they are dying from guns. very young. we have to teach children how to defend themselves. it is like, what do you do? you would rather be caught with protection than without it. i have never seen so many gui'is. like, we have so many guns. but i have never seen as many as now. bo deal is a rapper from the west

another disappointing sign in a disputed south china sea. oliver: all that is ahead on "bloomberg businessweek". ♪ carol: we are with the editor in chief macon murphy of business week. look like they are taking moves that could shore up the steel industry. ,> this is one of the concerns this massive oversupply in the steel market, and even though there has been a concerted national domestic policy to address that collect, it hasn't manifested. on the supply side, they are trying to trim that down. that to go down to have the steel price go up to make this supply and demand work for an industry that has been hit hard by massive oversupply. bys he's does show that limiting production, that is having a positive impact and shows signs of progress in terms of bringing that price up and making it more sustainable as an industry. let's talk about transparency as it applies to our president-elect. megan: good luck. be in: donald trump will washington, d.c., and you look at the conflict. is in ahat hotel, it famous building, one of the most prime p

in the south china sea. one of the most contested areas anywhere in the world. beijing is building huge artificial islands on the spratly islands chain, which the americans and others insist are illegal. the area is difficult to get to, but rupert wingfield—hayes flew in a small civilian aircraft into china's self—declared security zone 200 kilometres off the coast of the philippines. this is what he found. it's just before dawn on the philippine island. even at this hour it is hot, but there's no sign here of the trouble brewing a few hundred miles out to sea. i'm about to take off on miles out to sea. i'm about to take offona miles out to sea. i'm about to take off on a trip the chinese government has tried to stop. as we roll down the runway, we're all tense. no one has tried what we're about to do. we're now heading south—west to wards and number of chinese controlled atolls. these are places where the chinese have being doing massive land reclamation over the last year and a half. we really want t

china -- in the south china sea. i thought, ok, i want to talk to this guy and see how he ended up in the middle of this geopolitical debate. carol: he is a professor of marine biology and ecology at the university of miami. talk to us about the research he did and what he saw, and why it is so important. >> it goes back a long way. he had been based in the philippines for years, and he had done this very early study of exactly what was happening in the spratly islands. why, they are hardly islands, they are reefs and -- carol: you look at a global map, and they are like nothing. >> they are tiny, and that is what everyone is fighting over. this was back in the 1980's and early 1990's, back in the philippines, and he was trying to figure out where fish were coming from, how these fisheries were getting repopulated. and he did this study based on totally archaic methodology, looking at paper maps with onoes on them, -- arrows them, and he figured out the spratly islands were the source for the fisheries on the coast,

the aim is to reinforce china's claim to the whole of the south china sea. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. and as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. now to evidence of a startling rise in gun violence the us, including in barack obama's hometown of chicago. killings in the city have reached a 20—year high. a deadly summer of violence brought this year's death toll to 500. most of the victims and their killers were young men. we spent a week in chicago and found a world where guns rule. in my neighbourhood, they start young. that is the edge, and they are dying from guns. very young. we have to teach children how to defend themselves. it is like, what do you do? you would rather be caught with protection than without it. i have never seen so many gui'is. like, we have so many guns. but i have never seen as many as now. this is a rapper from the west si

flew a bomber around the south china sea. the chinese had not flown that route since march 2015. the country is ready to take taiwan by force if the u.s. doesn't recognize its part of china. the current commander in chief cautioned that china sees taiwan as an existential threat. >> this goes to the core of how they see themselves. their reaction on this issue could end up being very significant. >> reporter: a short time ago, i was handed the official chinese response to the state department's process known as a demarche. a chinese official responded, quote, you know that china has undisputed sovereignty of the south china sea. there are risks from your continued surveillance. the south china sea is international waters. it does appear tensions are ratcheting up. >> lucas, thank you. >>> one of the challenges to the incoming administration with its unconventional president-elect will be dealing with unconventional warfare. tonight, catherine herridge reports there's a lot of gray area in what used to be the black and white b

moves china is making in the south china sea. a lot remains to be seen about what happens here. i guess we will be watching to see if current president obama will mention it in his press conference that is coming up. it was not on the agenda, but he will be reacting to it now. sahil kapur, nick wadhams, to a. we are -- thank you. we are awaiting the press conference with president obama to see what he talks about before he goes away for the holiday. we will for comments on china and russia with all the hacking information. we will bring that to you as soon as it begins. this is bloomberg. ♪ scarlett: mrs. bloomberg markets. i am scarlet fu. oliver: comedy markets are closing in new york. abigailt to it doolittle. on the week it is a different story. gold is down 2%, a big decline on that federal reserve rate hike. the dollar climbed pressuring gold. this is gold six decline in a row. gold has been down every week since the election. bloomberg and in yellow we have gold and in white we have the 10 year yield. ,e see as yields ha

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

brent: china has installed weapons on artificial islands it has built in the south china sea. that is according to a new report by a u.s. think tank. it has been tracking satellite images since june and they reportedly show antiaircraft and missile-defense systems on the islands. reporter: these man-made islands in the south china sea appear to have become china's newest military outposts. according to a report from the u.s. think tank center for strategic and international studies, these show weapons including large antiaircraft systems. china lays claim to almost all the south china sea, despite competing claims from countries like malaysia, vietnam, taiwan, and the philippines. in july, an international arbitration court ruled there was no legal basis for china's territorial inroads. china ignore the verdict and continued building the seven artificial islands that have now been turned into military bases. they deny the deployment of weapons to the islands have anything to do with weaponization. china is buiuilding facilities n its own territory is completely normal. this is

gun placements are spoken in the south china sea. they have built up 3000 acre of artificial islands and bomber flights have occurred. and a keek ago they flew a long range nuclear bomber. moments ago, i spoke to former head of a force intelligence and he reacted. >> this is another example of the adventurisms and aggressiveness of the chinese in the face of quite frankly, an a nemic and feckless set of policys that we have seen in the last eight years. >> now to counter the chinese threat, the head of the u.s. air force needs 30000 more air men. and over the summer, he said he was 700 pilot and 4000 mechanics short and the top officer said the shortage of people has fundmentally changed the way we do business in terms of the operational risk day on day. he wants a variety of attacks and cyber are and nuclear, and the drones in the start of the afghan war. there was one drone orbiting the battle fold and this year, 60. and they need air force personal to take in recognizance. the air force had 130 fire squadron and now two did dayed

navy vehicle in international waters of the south china sea. exclusive reaction from former ambassador to the u.n. john bolton, a contender for the position in the trump administration. the president of the united states is expected to address this issue any minute from now. live picture of the podium at the white house. could this be his last news conference ever. all happening momentarily. hello, everyone. i'm trish regan, welcome to "the intelligence report". i want to get you up to speed on this aggressive move out of china. a u.s. navy drone that was studying ocean conditions in the south china sea was stolen today by a chinese warship. right in front of the eyes of the american crew. according to reports, the u.s. radioed the chinese, told them this was american property and should not be taken, but they got no response from the chinese until they turned away with our drone! that's when they road back saying they were returning to their own operations. so lots of questions about this right now. why did they do it? why now? president obama

and china in south china sea, accusing china of stealing one of our underwater drones, peter barnes joining us, what do we claim? reporter: that chinese stole this underwater drone. we should make it clear that this is an unmanned drone, a navy ship could 18in oceanography ship checking on the joans that monitor -- drones that monitor conditions in south china sea, not a military warship. president did not come direct leo thily on this in his press conference today. he i a call that leader of taiwan made to president-elect trump, call that president-elect trump took, that was unprecedented. some felt some critic felt could disrupt relationship and create more tension between u.s. and china. given that the two countries operated under so call one-china policy since the nixon era. that taiwan is still unfortunately a part of -- a part of china, president obama admonishing trump, saying before accepting courtesy calls he should have his whole team in place and briefed. >> idea of one-china is at the heart of their conception as a nation. and so if you are going up end this understanding you ha

from moving into the south china sea. it doesn't seem to have worked. >> well, i would say this on the -- there has been a lot of ambiguity with china dating for decades here, maybe there can be some clarity here. i would say trump didn't get this idea to call taiwan on his own. bob dole, the former republican presidential nominee set this up, he was a paid lobbyist for the taiwanese people on this and that's how that came about. so so much for draining the swamp. >> that's an interesting charge. steve, had you heard that charge before and is there any credence to it? >> sure, bob dole was instrumental in making it happen. my answer is so what. if he makes something good happen you ra grab it, if it's not good you ignore it. just because somebody may think they have something in it doesn't mean you should reject it. that's good judgment. >> i'm laughing because it reminds when hillary charged truch of taking advantage of tax write-offs and so forth he said, yeah, it proves i'm smart. >> that's the kind of bluntness you ge

it was in the south china sea international waters. our old friend, same ship, the bowditch, same ship that had that scrape back in 2001 right after george w. bush got sworn in. the bowditch yesterday back out there again, still unarmed vessel, still doing research, still with a civilian crew. this time the bowditch was using what looked like model airplanes. this is what they look like, autonomous little drone subs and they measure various ocean conditions. the bowditch apparently had two of these vehicles out in the sea collecting their oceanic samples and then it came time to bring them back on board. they had two of them out there. the bowditch picked up one of their little drones, but when they went to go get the second one, a chinese warship showed up. it launched a small boat, and then chinese sailors in the small boat grabbed the u.s. navy drone and stole it. they apparently didn't need grappling hooks this time like they did with the "impeccable county "and its sonar array. they're just six feet long, so they were able to grab

armed all seven artificial islands in the south china sea. yesterday in the press conference in beijing, the chinese foreign ministry was asked about recent fox news reporting about these bomber flights. china called them routine. china conducted live-fire exercises from the only aircraft carrier in the region in the last few days. jenna? jenna: so much focus on russia and hacking but what is china doing? something that we have to continue to watch. lucas, thank you so much. breaking news at the pentagon. more on that as we get it. leland? leland: right now president-elect donald trump getting ready to take his new tour to orlando tonight. i-4 corridor did well for him. last night he promised to put miners back to work in a rally in coal country. bryan llenas, wains burke, pennsylvania, in the keystone state with more. hi, brian. reporter: leland. green is the highest coal-producing county in pennsylvania of the for nearly 40 years emerald mines has been beacon of this coal community. less than a month ago, it closed down. slashing 500 jobs.

long been trying to frame it self as a peacemaker in the south china sea. the issues of sovereignty are not yet resolved. of course, that is sort of the key, fundamental issue. held in taiwan has ministry of control for six decades. china, too, claims the spratly's. theed by what is called by dash line. vietnam and the philippines also say the chain belongs to them. taipei have dismissed the ruling as having no legal merit. the wildcard is the threat of a more hawkish u.s. military under president trump. >> it could potentially embolden claimants. it could also embolden the united states and other major stakeholders to back up their policies with military action. taiwan, for now at least, is pushing a softer approach. it has built a hospital. a new wharf, capable of handling larger ships. and the 100 inhabitants, mostly coast guard personnel, raise their own food. >> it is definitely self-sufficient. stephen: the most dominant feature is this long airstrip. designed tocise is show the island is more than just a rock. taiwan says it can serve and protect int

china sea. >> merry christmas. >> merry christmas to you. >> in the meantime, the president came the closest i've if heard him to say the electoral college is -- >> at the electoral college is a vestige, a carryover from an earlier vision of how our federal government was going to, work, that put a lot of premium on states. >> all right. talking about is that maybe something that is antiquated and not really useful now. barack obama still reminding a lot of folks that if you have a compelling message you can win the popular vote and electoral vote and something that hillary clinton failed to do. having said that, all of this on the heels of demands on the part of a number of democrats, many hollywood elite sod say the electors with be gathering 538 of them have a moral duty to step back, look at the magnitude of what they'll decide and maybe vote differently. in other words if you come from a republican state that was won by donald trump, maybe rethink that and vote for someone other than donald

from moving into the south china sea. it doesn't seem to have worked. >> well, i would say this on the -- there has been a lot of ambiguity with china dating for decades here, maybe there can be some clarity here. i would say trump didn't get this idea to call taiwan on his own. bob dole, the former republican presidential nominee set this up, he was a paid lobbyist for the taiwanese people on this and that's how that came about. so so much for draining the swamp. >> that's an interesting charge. steve, had you heard that charge before and is there any credence to it? >> sure, bob dole was instrumental in making it happen. my answer is so what. if he makes something good happen you ra grab it, if it's not good you ignore it. somebody may think they have something in it doesn't mean you should reject it. that's good judgment. >> i'm laughing because it reminds when hillary charged truch of taking advantage of tax write-offs and so forth he said, yeah, it proves i'm smart. >> that's the kind of bluntness you get. steve forb

we don't tax them, with building a massive fortress in the middle of the south china sea, which they shouldn't be doing. frankly, they're not helping us at all with north korea. you have north korea, nuclear weapons, and china could solve

you have the issue of the south china sea with naval ships. you have north korea testing nuclear weapons. when i say this is a far more dangerous world it is not just in comparison to bush but it's the most dangerous world we've seen since the end of world war ii. >> the drone strikes have taken out a lot of terrorist leaders, afghanistan, pakistan and the middle east. >> he gets criticism from the left from that. >> he has indeed for killing from afar. when he talks about the long view he's right because he's set up a world which is going to be in a sense a stalemate, endless conflict in middle east, in afghanistan where both sides -- it's not as though nothing's going on. this is tremendously huge battles taking place like in syria and he did nothing to push it forward. it's just a stalemate and he seems willing to settle for a world which is in endless conflict. >> if you listen to that speech he really did -- >> this is obama making good on his promises. if you go back to his inaugural address where he talks about leaving iraq and afghanis

the upshot of the article that as china's presence grows in the south china sea this will be in economic boost for the people living around the south china sea the fishermen now have an entire new market to open up as a result that is the promise of economic prosperity through the shores of the country that borders on the south china sea that is a good reminder not just before lunch but the fact that the a2ad strategy not only takes place with the of military and economic sphere but the domain that is very interesting and a comment. >> and the chinese name of a2ad is counter intervention strategy. >> absolutely . >> we want to get started with our last but not the least panel that i think in many ways plus the seal on how we think about u.s.-japan cooperation and how we move forward at this point. from the of point of view of industrial security. is one thing to talk about technology sharing, a code development, co-production but there is the question how you go about protecting that technology and the data and the algorithms from falling into the wrong hands or prying where they don't b

china has been very aggressive in the south china sea, the east china sea and in relation to taiwan. it is entirely appropriate for a united states president to decide we are going to take a more aggressive policy towards china. if we are going to do that, we need to make sure we do it in a careful, measured, strategic thought-out way, not just a one-time response. because this ecosystem is so delicate and connected, there is a danger that there are going to be unintended consequences. if we want to be tougher on china, let's do it but through a rational thought-out process. >> this isn't totally unprecedented. perhaps the way in which it happened as jamie pointsous is. we have seen incoming republican administrations like the reagan administration coming in and extending a hand more out to taiwan than others. no? >> yes, indeed. that was the case in the reagan administration, in particular. the big difference is that taiwan is a vibrant democracy. people in taiwan feel slighted by the fact that they are being isolated by the international community. so, therefore, they feel there sh

brent: china has installed weapons on artificial islands it has built in the south china sea. that is according to a new report by a u.s. think tank. it has been tracking satellite images since june and they reportedly show antiaircraft and missile-defense systems on the islands. reporter: these man-made islands in the south china sea appear to have become china's newest military outposts. according to a report from the u.s. think tank center for strategic and international studies, these show weapons including large antiaircraft systems. china lays claim to almost all the south china sea, despite competing claims from countries like malaysia, vietnam, taiwan, and the philippines. in july, an international arbitration court ruled there was no legal basis for china's territorial inroads. china ignore the verdict and continued building the seven artificial islands that have now been turned into military bases. they deny the deployment of weapons to the islands have anything to do with weaponization. china is building facilities on its own territory is completely normal. this is

it was in the south china sea international waters. our old friend, same ship, the bowditch, same ship that had that scrape back in 2001 right after george w. bush got sworn in. the bowditch yesterday back out there again, still unarmed vessel, still doing research, still with a civilian crew. this time the bowditch was using what looked like model airplanes. this is what they look like, autonomous little drone subs and they measure various ocean conditions. the bowditch apparently had two of these vehicles out in the sea collecting their oceanic samples and then it came time to bring them back on board. they had two of them out there. the bowditch picked up one of their little drones, but when they went to go get the second one, a chinese warship showed up. it launched a small boat, and then chinese sailors in the small boat grabbed the u.s. navy drone and stole it. they apparently didn't need grappling hooks this time like they did with the "impeccable" and its sonar array. they're just six feet long, so they were able to grab it out

a lot of that is because the south china sea is a very sensitive topic for beijing. they use it in their messaging domestically. in fact, president xi xinping has been using the south china sea to whip up nationalism because he's trying to portray himself as a defender of china's interests against the west. and that, according to a lot of analysts here i speak to, makes it much more difficult for him to negotiate something with trump or to back down on this issue. and if you couple that with the fact that the chinese economy is slowing down. and there is also expected to be a political reshuffle next year, it just makes it that much more difficult for president xi who wants to project himself as a strong leader. >> eunice yoon, thank you very much for the update from beijing this morning. >>> wilfred, i just wonder, both of our must-read stories get at this topic. but how trump is going to -- if he's going to be as aggressive on the military side as he is indicating he will be on the economic side. because so far on the campaign trail, what he was really hitting at w

china sea. this could mean more sales for japanese makers of defense equipment. nhk world's yusuke ota reports. >> reporter: organizers of indonesia's largest defense trade show staged this event in november. more than 570 companies participated from 45 countries. japanese makers displayed some advanced hardware. this portable water purifier is for rugged locations such as jungles. it runs off solar power. the company is supplying it to the indonesian military. this model of a lightbulb by a major rubber manufacturer is drawing attention. it is also heavy duty and can carry large loads. >> maximum 101. >> 101? >> reporter: also here is the maker of amphibious rescue aircraft for japan's self-defense forces. the company hopes to sell similar planes to indonesia. >> translator: indonesia is a maritime nation made of islands. these amphibious aircraft can be very useful to access islands without landing strips. >> translator: it can land on water without excessive shaking. it's wonderful technology

notably concerning the south china sea. in these defensive systems could be seen, it could be argued, as running counter to the promises that president xi jinping has given about not wanting to militarize these assets and islands and reefs that china controls. but in its statement, china's ministry of defense has called these installations legitimate, saying they are there to defend against the threat of force, although the statement from the ministry of defense did not say where the threat of force may come from. lives,throughout our there are certain events that have such a major impact that we can remember exactly where we were when the news broke. a new survey asked americans to rank the most historic events in their lifetimes. the bbc has taken a look. reporter: what has been the most significant historic events in your lifetime? pew research recently posed this question to americans, and some of the results are pretty predictable. but others, they are kind of surprising. ok, so check it out. here's the top 10. let's g

china claims 80% of the entire south china sea, mark by what line.all the nine-dash vietnam in the philippines also say the island chain along to them. the conclusion that these are mere rocks and islands, could further destabilize the region that is already witnessing a more assertive china. beijing and taipei have as havingthe ruling no legal merit. the wildcard is the threat of a more hawkish u.s. military under president trump. >> it could embolden the claims in their securing efforts and embolden the united states and to backjor stakeholders up their policies with military action. , for now, is pushing a softer approach to legitimize their claim. a build a hospital with a solar power plant, and a wharf capable of handling small ships. and the 100 or so inhabitants, raise their own food. island is a self-sufficient islands that can sustain life on its own. there was a long airstrip. today's exercises designed to show that taiping island is more than just a rock in the middle of that south china sea. taiwan says they conserve and protect international trade routes through this very busy and

i mean, you cannot overstate the importance of the south china sea. it is half of our commercial shipping, the global commercial shipping goes through. a third of the global maritime traffic going through this. china asserts it owns 90% of it and they've been making a play to interfere in terms of ownership. not just for the shipping, but there is also a ton of oil, proven reverses underneath there. and so china has been building man-made islands and arming them and they flew a bomber just -- just two weeks ago or so, specifically a bomber that targets u.s. ships. that has the capability to target u.s. ships. so china is really making a play right now into essentially becoming that regional dominant player within the asia-pacific region because they want to have that control. and it would destabilize not just the economy but the regional stability if they are able to intercede. so i think trump is sending a specific signal right back to them. >> so a signal saying what? that we're going to put a stop to it. he is saying keep the drone. that is reactio

coming up: stand—off in the skies above the south china sea. rupert wingfield—hayes flies over one of the most contested areas in the world, incurring the wrath of the chinese. ian pannell reports from barack 0bama's former hometown and finds gun crime is out of control. the bbc went to extraordinary lengths this year to get a rare glimpse of china's determined expansion in the south china sea, one of the most contested areas anywhere in the world. beijing is building huge artificial islands on the spratly island chain, which the americans and others insist are illegal. the area is difficult to get to, but rupert wingfield—hayes flew in a small civilian aircraft into china's self—declared security zone 200 kilometres off the coast of the philippines. this is what he found. it's just before dawn on the philippine island of palawan. even at this hour it's hot, but there's no sign here of the trouble brewing a few hundred miles out to sea. i'm about to take off on a trip the chinese government has tried to stop. this place is called mischief

it was taken in the south china sea. the pentagon saying a u.s. ship was trying to retrieve two drones near the philippines when a chinese warship took one of them. >>> more news in 30 minutes. i'm leland vittert, now back to cavuto on business. >>> china is absolutely taking advantage of this country, neil, i feel it very strongly. i know many chinese people, i know many chinese businessmen, and they laugh at the stupidity of our politicians. they can't believe it. >> so what would you do if china were telling you straighten up, fly right, don't lecture us about our currency, on and on and on, what would a secretary or a president donald trump say or do? >> i'd tax the hell out of them. i would tax them back to china. >> all right. thank god for videotape and he was talking to me. that was donald trump more than six years ago. and it's been a consistent theme of his, as a businessman, as a politician and now as president-elect of the united states. this week china seems to be sending him a message. u.s. navy seizing a u.s. underwater unmanned dro

building of military base of islands in the south china sea, something the u.s. has not been able to stop. >> the u.s. sells a lot of weapons to taiwan. >> reporter: right. always part of the one china policy. u.s. arm sales to tie one has totaled more than $46 billion since 1990 in december 2015 the united states announced a $1.83 billion arms sale to tie one, the first military sale in four years. between 1979 and 2014. taiwan ranked as the nine inch largest recipient of arms globally. during the same per the united states supplied more than three-quarters of taiwan's imported weapons. there are some in washington who say the phone call with taiwan's president was designed to by provocative. >> certainly was. no matter designed. jennifer, thank you. in the white house says it's hard to determine what exactly president-elect donald trump and his team were trying to accomplish by talking with the leader of taiwan. >> some of the progress we have made in our relationship with china could be undermined by this issue flairing up. it's also unclear how the people who

what it has tried to do in the south china sea. it's massive military build up including a blue water navy for the first time in 600 years, after which the obama's response was pathetic and inadequate. >> so you think china is looking to become a dominant power and push the u.s. out? >> or go beyond that, just a few moments russia and china had joint efforts in the ped train an. the south china sea, too, but the i think it has taken advantage of the obama administration for eight years. and we are taking new issues on the economic issues. >> what does that mean? >> we believe in preload navigation. we sent u.s. vessels through there to show we are not going to be stopped doing that. what is it like, taking on china to say you have market for the american investment and trade with china, but the european union as well. the theft of intellectual property, distreatment in favorable courts. the chambers of commerce in the eu and hong kong and beijing have taken this on. elsewhere, where they have not lived up to is a pretty big task in

there are risks in the south china sea. and when you maintain close surveillance like that you will have risks. so, essentially they tell us, so many words, that we have your underwater sea vehicle, we had a right to take it. lou: and thetic tra economy --iic translation -- extrapolation it a shared risk, they are running risk as well, one would think this country, would have a response, but there has been none. >> there will not be much of a respond fro badge obama administration. >> there a great power competition with u.s. and china, and also russia, russia is shooting at uses their airplane to bomb our syrian monitors. now great power struggle is real, they are not supporting international order that has been established for 70s years, they don't see it in their national interest, they will take it apart, what is happens, china is, militarize in south china sea to be part of their regional strategy to dominate the pacific and asia, they have made up their mind, now they have military strength to back up their political

and it's -- china maintains the nine dash line claim to the south china sea which was invalidated on july 12th. the seizure was outside that line area which means it was contemptuous of the united states and the international system in general. >> we'll see what the president elect's response is moving forward. thank you so much for spending some time with us this weekend. >>> up next, president obama all but names vladmir putin as the man behind russia's alleged attempts to mettle in the united states election. we'll take you live to moscow with the latest details after this quick break. >>> president obama in his final news conference of the year called out russia. cnn's chief national security correspondent jim sciutto has more. >> reporter: the cia director seeking to dismiss accusations from gop lawmakers and the president elect himself that the agency is somehow politicizing the intelligence on russian hacking of the u.s. election writing the entire cia work force that the u.s. intelligence community and law enforcement are in full agreement on the seriousness and intent of the

the aim is to reinforce china's claim to the whole of the south china sea. more than 40% of the world's trade passes through the waters below us. china is determined to assert its control. america and its allies say they won't let that happen. and as we have found out, it may already be too late. rupert wingfield—hayes, bbc news, in the south china sea. now to evidence of a startling rise in gun violence the us, including in barack obama's hometown of chicago. killings in the city have reached a 20—year high. a deadly summer of violence brought this year's death toll to 500. most of the victims and their killers were young men. we spent a week in chicago and found a world where guns rule. in my neighbourhood, they start young. that is the age, and they are dying from guns. we have to teach children how to defend themselves. it is like, what do you do? you would rather be caught with protection than without it. i have never seen so many guns. like, we have so many guns. but i have never seen as many as now. this is a rapper from the west side, now, the mo

the contested south china sea, for example? >> i think it will -- it could potentially in the south china sea -- i think china's been going their own route there. i'm more concerned truthfully with relationships with north korea. how japan sees this. how other nations in asia see this kind of an approach where it's an unknown communique without informing allies that are dependant on these kind of relationships. so it is more than just a tete-a-tete with one other country. whenever you have communications like this you have to consider the whole of the alliance and the strategy writ large. those are some of the things that mr. obama has been slammed for that he hasn't had coherent strategies. this is a one-on-one nation communique that is just not good for that part of the world. >> admiral williams, same question. do you worry about the contested south china sea, for example? >> i do, there's $5 trillion of trade that flow through the straits in the south china sea area. i guess some time ago, president obama has been a little

travels through the south china sea and it will give them the means of controlling the south china sea against any scenario short of war against the united states, which no one wants, including us. we have to continue to work with china on that and our friends, allies and partners to assure them and we continue to build critical combat power and build a network of like-minded friends, allies and partners to ensure that we can operate internationally. >> let's keep the questions brief. >> i thought i would ask about the ilitary officials on the panel. have you seen any tangible benefits from this initiative? to the members of industry, how do you view this? o you see them having an unfair advantage with this fast-track acquisition tool? >> i was out there a few weeks ago to check on exactly what you asked. frankly, it is a bit early in terms of tangible benefits. this is not the kind of stuff these wrinkle magic dust on and get magic solutions. i think it's a very good idea. i think there are some tweaks o it. i think it's a very good dea and should be sustained in idea and should be su

and china, one certainly on taiwan, one over the south china sea, one over trade. all very dangerous tense issues, without any articulation of exactly what the change is, other than we're going to be tougher here. and the thing is that each of these has a potential for an escalatie ining conflict. the south china sea, you have u.s. war planes flying over those islands. i was on one of them last year, coming in very close proximity to u.s. war planes. you have chinese warships sailing by those islands coming very close as well. as you raise that tension, those conflict points, one of those, whether it's in the military sense or as van says, in a trade sense, has the potential to blow up, to some degree, and when that happens, it's not just the chinese that pay, right? it's americans who potentially pay as well. >> we're going to have more on this conversation. we're going to focus on a completely fake news story. a member of the trump transition team, and the man who opened fire at a washington pizzeria. later, protesters trying to stop an oil pipeline score what lo

a military confrontation with china in the south china sea? could it lead to a trade war with china and i'll throw out a third thing, north korea. north korea's getting very close to have a nuclear weapon it could place on a missile. china is our leverage to stop north korea from doing that. >> but, but isn't it possible, china's also building military installations in the south china sea, right? it's becoming more and more aggressive militarily. the united states is worried about that. cheap steel on states like ohio cheap chinese steel and that makes the manufacturing jobs go away in the rust belt of america. so, when you consider those things, which are more important to people's lives, frankly, in the short-term, right? then, then, again, donald trump's supporters would say, go for it, donald. >> right. well there's a lot of agreement that there are problems with china. but i think that two issues. one is how is he conducting this kind of diplomacy. twitter is not subtle nor are the statements he makes. that can have dangerous consequences

into the south china sea. you have more on this. adam: five battleships with a, as they passed taiwan at the archipelago, it sends a message to taiwan, the taiwanese government, the south china sea is a dispute in and of itself because china claims the entire south china sea has its own territory where the international community says these are international waters. that aircraft carrier you -- originally a ukrainian aircraft carrier they sold to china. it is fine's only aircraft carrier. the chinese are a threat in that part of the world is my neighbors do not like this show of force. ashley: the aircraft carriers -- they are building their own. they are a long way from becoming a force. >> compare them to us but an aircraft carrier, and aircraft carrier groups. ashley: $256 million in tesla's us point, and located in buffalo, new york upstate new york economy. president-elect trump says the world is a gloomy place where he was elected and economic options, and there was no hope. the market is up 10%, christm