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tv   Bloomberg Daybreak Asia  Bloomberg  September 13, 2018 7:00pm-9:00pm EDT

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haidi: good morning to you. i'm here in sydney where markets are one hour from open. i'm sophie in hong kong. welcome to "bloomberg daybreak: asia." pacific stocks set to extend the rally of the wall street high on the dollar falling as the u.s. in credit inflation crawled. emerging currencies in relief as
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turkey higher than forecast despite the president demanding a cut. striking arump defiant tone added new trade talks. he feels no pressure to get a deal with china. shery: that of course had the markets. let's take a look at the u.s. market rep for the third session in new york after the president tweeted that the u.s. is not under pressure to get a deal with china. we saw lower downside pressure for markets. still, they managed to hold onto those gains in the dow closed up for a third consecutive session. we did get u.s. slowing more than expected. that pushed stocks higher. s&p 500 led higher by tech. by tech,relief rally not to mention health care stocks up. let's see how this developed in asia. sophie with the latest. sophie: with that tech rebound
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in the u.s., and a softer dollar, we could be seeing cautious gains. after the worst losing streak and 16 years. shares are to be downside, although easing earlier declines. kiwi dollar up by about .2%. we did get manufacturing pmi's sticking below normal in august. japanese protection due at midday, nikkei futures pointing header -- putting higher ahead of that. that could finish off the week higher. we are waiting on a monthly report on the economy and on the geopolitical front, a joint office has been opened as preparations are being made for the kim-moon summit. the upcoming data dump from china at 10:00 a.m., we will get retail, and fixed market investments. i have that, we saw chinese and hong kong shares rise for the first time this week.
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helping the hun sen get its biggest rally. haidi: long overdue relief there. thank you for that. let's get you the first word news with jenna dagenhart. the lira jumped as the central bank of turkey hikes rates more than expected. the monetary policy committee raised the one-week rate by 625 basis points to 24 percent. almost double the estimate in a bloomberg survey. that came hours after everyone caused chaos -- erdogan caused curtailing ofa the use of foreign currencies. the leading edge of hurricane florence has reached the u.s. coast, bringing strong winds and rain. it has been done get it to category 2, but still forecast to deliver more than one meter of rain and a four meter storm surge. causing damage worth $20
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billion, more than 1000 flights have been canceled and 3 million people could lose power. president trump with up a storm with his comments about last year's devastating hurricane in puerto rico. he rejected the official death toll is almost 3000, saying his enemies are patting the numbers to weaken him. a study by george washington 5 peoplety says 2,97 died as a direct resort of the hurricane. to its highest against the dollar in six weeks. this as the u.k. government pledged to provide information that could result the post exit order with ireland. you officials are rewriting a key part of the potential divorce agreement to try to make it more palatable to the u.k. the two sides are expected to hold a summit in november to sign a broad outline of the accord. reports from london say bank of england governor gave senior
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ministers a stark warning about the danger of failing to secure a deal on brexit. foroined a cabinet meeting a no deal outcome and said chaos could drive home rice down 35%. the guardian says he warned that no deal would be a catastrophic as the 2008 financial crisis. jeff bezos and his wife have launched a $2 billion fund to help homeless families and create a network of nonprofit preschools in low income communities. fund would day one use the same principles that have trip and amazon. his fortune of more than $160 billion has grown this year alone by almost $65 billion but he has been invisible in the world of philanthropy. global news 24 hours a day over the air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am jenna dagenhart. this is bloomberg.
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thank you. but give back to the u.s. market close. all the major benchmarks ended closer. tech stocks and health care also joining in for more. let's go to our asset reporter. take esters rally. we would have probably closed higher had the president not poured cold water on the trade talks. tara: immediately after he tweeted, we saw that reaction in markets. we had a pullback when he said that the u.s. was not under pressure to accept a deal with china. that brought higher mostly by tech. he saw a relief rally. yesterday, we saw some weakness during that product event, today apple is the biggest gainer on a points basis. microsoft
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conductors. we've seen weakness there recently, however the philadelphia semiconductor index rebounded above its moving average. one name that was interesting was amd, as semi conductors have been falling, amd has been the one surging. today, it was the opposite. amd was lower, even though bank of america did raise its price target. haidi: we some weakness and homebuilders. why? sarah: we have seen weakness all year long. if you look at the s&p 500 homebuilders index, the only month this year that it was actually higher was in march. we have seen losses every month due to concerns like higher labor costs, higher material cost, raising rates, but today a lot people are saying it could be due to the storm. typically, a hurricane is a boon for homebuilders. yesterday when hurricane florence was a category 4, today it was downgraded to a category two and some people are saying there might not be as much damage and you might not need as much rebuilding. you're still left with these
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down side effects, like people evacuating or wet soil, then you have to delete rebuilding. shery: we also have inflation numbers, core cpi gaining 2.2%. that is less than anticipated and a leg up for u.s. stocks. sarah: soft inflation is very welcome at this point in the cycle. we got the soft cpi number this morning and it did support stocks drop today. we also saw bond yields lower across the curve. we saw the dollar fall, but many are saying this does not change much for the fed. it does show that inflation is not an issue. they can stay on a path and don't have to speed up which is good for stocks. shery: thank you. bloomberg's cross asset reporter. chief economist ben edmonds joins us next. here why he says central banks need to tie in more than the fed. later on, live in
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singapore with the man leading coca-cola and asia. john murphy joins us in conversation. this is uber. ♪ -- this is bloomberg. ♪
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shery: this is the break am shery ahn in new york. turkey's central bank boosted key rates more than expected in a bold step that pleased to the lira and should president earl on its independence is not been compromised. erdogan itsesident independence has not been compromised. makes myent erdogan attorney policy so interesting in turkey. i don't think we have seen a head of state like this in a long time. nonetheless, the central bank did not let this stop them. hats off, this is very important
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and is certainly a time when many people in the country are thanking them. rate theyoost the key are using now, they have been switching it for the past couple weeks. 625 basis points, up to 24%. jump into the bloomberg with me. v charts.ne of our #gt you have got the key chart. this is the one week repo rate. it is up to 24%. lira showing a full bit of a response. a pretty good response over time. the central bank is having some success as they are boosting confidence. the central bank is boosting market and investor confidence that they will do the right thing, no matter what everyone says, calling courtesy roots -- currency moves belittling. insist that high interest rates cause inflation.
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those who disagree, don't know the business, and to make matters more interesting today, he has banned turkish businesses from using dollars and euros in their transactions, creating even more chaos in his economy already trying to hold itself steady. an interesting day but hats off. the ecb andanges in the boe. kathleen: probably no surprise, we all figured all along they would be the turkish central bank that got the spotlight. very important but the european central bank does and staying on a path toward eventual highs, they will wind down bond purchases. you probably want to see a rate hike until autumn of next year. he does see growth risks as balance. -- balanced. emerging-market strains are on the rise, but he is confident that there is enough strength in the economy and tightness in the
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labor market to boost inflation. let's listen to what he said earlier today at a press conference. uncertainty around inflation is receding. looking ahead, underlying inflation is expected to pick up toward the end of the year. and the year after, to increase gradually over the medium-term, supported by monetary policy measures and the continuing economic expansion and rising wage growth. let's look at other major central banks. it certainly caught the attention of the market. they kept the key rate steady even while boosting gdp forecasts. it is so interesting, mark carney telling the cabinet kind doors a big warning, a no deal brexit could risk havoc on the economy. shery: thank you so much for
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that. joining us for more is ben emons , intellectus parters chief economist and head of portfolio management. today you are in new york. great to have you. talking to kathleen, we were talking about wreaking havoc in the u.k. economy. we are seeing these tightening moves or at least the intention to tighten from central banks. what is this going to do to emerging markets? we are seeing a selloff and central bank's are not letting up. ben: you look at this move from turkey today, this is a good example of how fast they have to hike to catch up with inflation. you would think that previous theod, it's down 20% to dollar. those emerging market banks have to catch up so you will see this in turkey and brazil, you may see it in asian countries. they have to react to the currency weakness. shery: in the meantime, you see
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the u.s. dollar strengthening. this is not going to help when it comes to dollar debt in these economies. ben: give a difference from the crisis of 2008, now we are dealing with huge amounts of dollar debt in emerging markets. the dollar strength puts a lot of pressure on those companies and you get more trouble in the economy. we are dealing with a situation where tiny central banks are not positive for those economies. shery: you mentioned the pressure on -- haidi: you mentioned the pressure on asian e.m.'s. i want to throw at this chart preparing for a review. they could take further action or intervention to try to steer the rupee, which has been hitting record lows as they previous intervention. yields continue to serve. is there a sense that central banks in economies that have solid fundamentals are just part
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of this situation where they try to intervene? ben: if you think about it, if you can't control the movement of inflation because of your currency, that is out of control. then, it is hard for the central bank to be ahead of it. we always talk about being behind the curve but it is exit happening in emerging markets and that is what you see these aggressive moves like we saw today in turkey. you can see this in india to some extent. faster rate hikes. this does lead the average interest rate in the emerging-market prehire. marketse emerging pretty high. haidi: we are not there yet. if you look at valuations, that is one reason we are finally seeing this relief rally.
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on valuations, things are already cheap. if you're a long-term investor, now looks pretty tantalizing to do back in. ben: to an extent. you do want to keep in mind how the central bank will react. today was a good thing in turkey and the currency responds positively, but we have to see how it stabilizes. i would be more defensive initially looking at where currencies are undervalued, but these fundamentals are such that you don't have accelerating deflation emerging, catching up to falling currencies. if you think about countries like malaysia or korea, those countries are interesting when you think of the higher countries, you want to play cautious. shery: what are your thoughts on today's inflation numbers? it was surprisingly flowing more than expected.
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are these technical moves, is that temporary or is it a fundamental issue? ben: it is somewhat of a statistical technical factor. i do think the broader picture is that we have a strengthening economy but not accelerating inflation. that is why markets like this. it is not show that the fed has to change course. show what came out, bostich just came out saying we should continue with rate hikes from here. he was more conservative a few weeks ago about the yield curve. in a benign inflation environment, steady inflation environment. shery: the new york fed index jumping to 14.6%. the gtv library has that. it is a level we have not seen since 2006. we saw this sort of behavior for
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the new york fed index 18 months before the last recession. if the fed continues on this gradual path but still hiking rates, how close are we to the next recession? ben: that is a great question. indicator like this is based upon market expectations embedded into the yield curve. realme point, we reach slowdown and then a recession. that theke some note fiscal stimulus currently in the system looks to be rolling off next year. that depends on how much the yield curve inverts to have that signal probably one year, from then on to see this potential recession. let's hope it does not happen, but it doesn't like we are moving toward a yield curve inversion. haidi: i want to end with your views on the dollar. take a look at this chart. we have talked about having a healthy skepticism when it comes
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to the correlation studies we are getting, but this does seem like a no-brainer. and stocks, in assets, negative correlation is pretty close to extremes. it goes out saying that if you can go the dollar right, everything else falls into place. is there any argument we could see a downturn in the dollar even if the trade story was taken out, you saw the rate divergence part of the narrative. ben: that divergence will stay for the moment. just take the ecb. today, they will hike probably by next year. that is a long time from now. in the meantime, we are able to go up at least three times in that timeframe. the rate differential will stay. the dollar will behave depends on how the u.s. economy stays on a strengthening path. it is interesting to note that with the reform has done is pull a lot of my back into the economy. rate and by the
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time they finish it, it could be over $1 trillion. that does strengthen the dollar. we may stay in this environment for the moment and ultimately, the fed would have to shift from a tightening bias to neutral to easing. that is when the economy slows down. i don't think we are there yet so we will stay in a water rate differential environment with a stronger dollar. haidi: always great to have you. thank you so much. intellectus parters chief economist and head of credit performing a management with us in new york. you can get a roundup of the stories in today's edition of daybreak. go to dayb on your terminal. we also have the russian central bank decision coming up next. you can get all of that under a mobile -- on your mobile. this is bloomberg. ♪ g. ♪
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haidi: this is daybreak i am haidi in sydney. shery: i am shery on in new york. saturday marks 10 years since the start of the financial crisis. this week, we look at lessons learned from lehman and ask if the system is prepared for a repeat. deutsche bank was one of the few institutions that did not seek a government a lot. it's former ceo told bloomberg about the challenges the bank went through. hard anded very organically, i'm not saying we were not successful. we moved from very low profitability to $4 billion in 2011. grows very difficult to organically. there were not too many opportunities to buy into the market before the financial crisis.
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available and we do that immediately. banks, see in other acquisition is not all. it is a challenging market. predecessors seven years way to aaid the only large scale is going into investment banking. -- i of people applauding got a letter from a famous european banker saying you are the only one who made it. that was a huge achievement. then of course can the financial crisis, which we went through without any major loss, compared to jpmorgan. for example. we did not need any money from
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the government. we had not as big as some of our competitors and it should be also -- it has to be explained come over did not have many court rulings on that. we made settlements in order to keep everything going, but the u.s. played hardball. with the u.s. banks. power, hema came into sent an email and i still remember the last sentence. .oin me in fighting that was the attitude at the time. let them get disciplined better
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and let them pay for it. that was the attitude. haidi: that was the former deutsche bank ceo. coming up, it are trade tensions threatening coca-cola? we'll ask the asia-pacific president.
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mattress sale and save. for a limited time get 150 dollars off and free shipping too. sale prices are available right now. go to buyleesa.com today. you need this bed. haidi: we are 30 minutes out from asia's first major market opens. 7:30 p.m. in new york where markets close higher. by .5p 500 was up percent. a relief rally in tech stocks , despite there president tweeting that the u.s. is not under pressure to reach a trade agreement with china. in new york, where it is looking beautiful outside. haidi: haidi in sydney, not quite suitable. a bit of a gloomy day, but it seems to be the reverse. we could get a second day of a recovery rally in asia. let's get you to first word news. bank: the european central
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confirmed it will cut bond potentiallyalf and ended program by years end. the bank will buy $17 billion of .ssets from october to december policy after that continues to be contingent on data. officials repeated that raise will remain at current lows through the middle of 2019. the risk is still assessed as broadly balanced. at the same time, wrists -- risks related to rising tensions and vulnerabilities in rising markets. vulnerability has gained more prominence recently. jenna: meanwhile, the philippines is bracing for the most powerful typhoon of the year. onecasters expected to hit saturday with winds of 265 kilometers an hour. it has been rated a super --hoon and is protected
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projected to maintain the strength when it makes landfall. thousands have been ordered to seek shelter and government offices are closed. gauge of underlying u.s. inflation unexpectedly cooled in august. prices fell by the most in seven decades. it suggests little urgency for the feds to speed up rate hikes in the budget deficit widened to $900 billion in the 11 months through august. that exceeds the cbo forecast for the first fiscal year of the trump presidency. one of the best-known investors in digital currencies has called a bottom in the great crypto crash. galaxy treated a snapshot of the bloomberg galaxy crypto index which measures currencies including bitcoin. he says retracing the whole of the bubble suggests it hit a low wednesday.
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most crypto's are now trading higher. famous paintings is now heading to auction and expected to smash the record for work by a living artist. therait of an artist, pull two figures will be sold in november. the house estimates it is worth about $80 million that says it could easily sell for more. the current record holder is jeff koons balloon dog, soon -- sold for 20 million. global news 24 hours a day over the air and @tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i'm jenna dagenhart. this is bloomberg. shery: thank you. counting down to the major market opens in the asia-pacific. asia futures looking up. former, here is sophie. could we see the week ending on an up note? festivewe could have a friday. this after asian stocks got there first daily gain for the
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month of september after a 10 and a slump. we have data on the docket that could drive sentiment from the day. we are waiting on japanese factories for production and we have the data from china 10:00 hong kong time. his -- fixed asset investment, we are expecting an improvement for august. gains likely for some of the major benchmarks in the region, other new zealand is lagging so far. using the earlier decline after we got the manufacturing pmi coming up. we did see a slight improvement for the month of august. for how the session may pan out, i want to bring up this chart. it shows you chinese tech is making a comeback. as you can see, the tech etf in peers byoutpaced u.s. the most for any day this year. a bottom could be in the making for chinese tech, which would
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quell emerging-market stocks and correlation at the strongest since 2016. markets,tching indian the rupee is in focus. are we expecting more action? the pressure is on indian policymakers to stem the slide. it is the region's worst performer, down 11%. we saw the jump wednesday after the government announced the administration is reviewing economic policies. they are measures to defend the currency as well. we did have inflation for august. julie, that would give reason for pause on tightening but speculation is building that we are in line for faster rate hike from india after two increases since june. this after pressure to defend the rupee. we will see with the weekend brings when it comes to government review of the economy. today, we're waiting.
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haidi: thank you so much. week, sophie on markets for us. day two of the asia summit in singapore. our reporters there talking about a future beyond visiting. .- beyond fizzy drinks >> i am here with coca-cola asia-pacific group president john murphy. they recently had a $5.1 billion acquisition. we'll get to that plan shortly, but we want to talk about the u.s. china trade tensions and have a slid into asia pac business. thank you for joining us. seen tensions escalate between the u.s. and china. how is that playing into your business? are you seeing a backlash? have many global brands. we are essentially a local business.
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95% of what we do is local. in that regard, we are not a we're not seeing immediate impact. having said that, these tensions could impact overall demand overtime if it is not managed well. we are on the lookout. for right now, no major impact. juliette: you are not concerned of any construction for the -- to any disruption to the supply chain? john: we have had no impact. juliette: let's talk about the recent coffee acquisition, the $5.1 billion acquisition. it is part of your overall strategy to move away from fizzy drinks. when you look at coffee in china, starbucks is the focal point. do you have any plans to take this more expansionary into china? john: as you mentioned, coffee globally is enormous. $300 billion.
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we have a small footprint and we tremendousas being a opportunity to expand that footprint. china will be one of those. toiette: in terms of how focus away from the fact that there are health concerns about carbonated drink, where are you putting your effort into? is it into bottled water, other areas? john: one of the major areas of focus at the moment is to do a better job of following the consumer. it depends on whether the market by market analysis consumer behaviors and beverage trends vary by part of the world. here, the asian consumer likes to drink a broad array of averages. hot, cold, sweet, unsweetened. our game is to try to see where
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the consumer is going and be in the position to offer a great beverage for every occasion. have five business units. tell me about your india strategy. her has been some speculation that you could be going after others. john: i have read that with interest. india is an enormous market for us. we have a growing business there. performance at the moment is very exciting. as we are doing in many parts of the world, we're looking to invest for the consumer is going. muchmeans that we are very on the lookout to drive our existing portfolio brands. but also when and where appropriate, to add on to the portfolio. it would be inappropriate for me to say much about that. juliette: in japan, there has
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been a push into alcoholic drinks. how are you seeing that growth? john: japan is an interesting experiment. the beverage we have launched on thear, japan has been forefront of our push into being a total beverage company for many years. category is one where the consumer has moved into. offers us an opportunity to leverage our existing supply chain and right now, it is an experiment. be given thed to opportunity to play with it. juliette: are there any plans to merge with any of the other big names in china with bottled water? john: no big plans on the horizon. bottled water is a huge category all over the world. where we are
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looking to expand our footprint. some markets have a small footprint today, so whether we do it on our own or in partnership, we are looking to see what happens. we'll take advantage as they arrive. groupte: how is the apac going versus the rest of the world? john: we have been excited with our performance here today. the first half has been strong. especially pleased with performance in china and india. some of the mid tier emerging markets like vietnam also doing well for us. your today, it is doing well. expect a specific -- asia pacific to be an engine of growth. juliette: you are about to do a panel on how to make sustainability profitable, how do we do that? john: i think a couple things. that toto recognize
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make it sustainable, make sustainability sustainable, it is required to work in concert with civil society, with government. the private sector has a big role to play and we are particularly interested in being a part of that. to make it profitable, it has got to become part of the business objectives of leaders locally and we're focused on making that happen. juliette: best of luck with your panel and thank you for joining us. that was john murphy, coca-cola asia-pacific group president during the at the milken summit. all that talk about coffee making me a little thursday. for everyeverage occasion as he says. what's more from the summit with juliette throughout the day. i want to touch on one of the stories we have had the last few hours. this reshuffle at the top. incoming ceo really making his mark in the upper echelons of
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goldman sachs. three of the most important roles at the bank have now been be held byll executives who rose to seniority for the steelmaking units. that is a shift. what do we have, could a changing of the guard be completed with the head of the investment banking decision, he is the number two most powerful person in the bank. long-termit the practice of letting top performers split the major roles. a consumer banking chief is to be next chief financial officer. a current cfo going back to the trading division, making him the third cohead of the bank's largest unit by revenue. potentially get an uptick in that part of the business as well. the ceo stepping down at the end of this month, his long-term deputy is no longer there.
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he departed for his adventures in the white house. just to point out in terms of diversity, it is quite obvious he the top three roles are all men. at least david solomon has said he wants to make closing the gender gap one of his priorities. that is a welcome move. we have seen this new story with bloomberg asking for this ,esearch being done by paddle showing that 155,000 company the paste calls over ofyears, men spoke about 92% the time. we could be tempted that that is because there are more male executives, but it is also just because men talk more. there have been studies out there that men just talk more in all kinds of settings, including school board meetings or the supreme court. when women -- the 8% of the time
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they speak on these earnings calls, they keep it to softer introductory remarks. we will be looking forward to see what david solomon does when it comes to goldman sachs in closing the gender gap. coming up, is the u.s. underestimating beijing on trade? our next guest believes so. we hear from the former chairman of morgan stanley -- morgan stanley. this is bloomberg. ♪
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shery on in new york. haidi: i am haidi stroud-watts in sydney. president trump may have tweeted that he feels no pressure to strike a trade to the china but our next guest believes he is underestimating beijing's result. stephen roach is a former chairman of morgan stanley asia and now a senior fellow at yield. -- at yale. in terms of the media narrative or the trump camp narrative,
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this trade war is hurting beijing more than the u.s. trump taking a stab at the declines in u.s. stocks -- chinese stocks and other asset classes, is that a true distinction? stephen: i wrote a book a few the two-wayout relationship between the united states and china. and, called codependency china depends on u.s. consumers to provide external support to its export led the economy, but on the other hand, american consumers depend on $500 billion of low-cost chinese goods to make ends meet. savings short the u.s. economy need surplus savings from china to help fund its
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budget deficits, which are going from bad to worse. the idea that america got the upper hand because the chinese stock market is under pressure is wide of the mark. very smug and complacent in terms of our president's appreciation of the role the china plays. haidi: we know the trade war has not played well back home. there has been lots of pressure points for the chinese president over what has been dubbed the summer of discontent. setting upk this is for a war of attrition or do you think there is a roadmap to a more conciliatory relationship even if we do get this next round of talks? stephen: i am worried that we appreciationgood of the endgame. what the u.s. is after is for
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to give ground on its core industrial policies, like made in china 2025 or the artificial .ntelligence plans for 2030 these are credit goal for china's innovation-based strategy to stay the course of economic development and the trump administration appears to object to these plans as being a threat to america's economic future. if the u.s. is looking for china respect,round in that i think they're in for a rude awakening. shery: this is the 10th anniversary of the great financial crisis. will the next downturn come from china? stephen: no, i don't think so. i think the chinese economy, while it is portrayed as being
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weak by the trump administration, it is a lot stronger than why the appreciated. i hesitate to draw the connection between the stock market in china and the state of the chinese economy. the economy is growing 7%, addressing a serious debt problem. it is making progress in rebalancing its economy significantly. i don't see china as a source of the next crisis. haidi: what about emerging markets? there is an argument this is meant to play out in three acts. the u.s. economy and wall street, then over to the european debt crisis, then emerging markets and possibly this moment in china. do you see the third act playing out still? stephen: not in china. somenk there certainly are pressure points in emerging markets. obviously, argentina and turkey
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come to mind. expected as the central banks now start to withdraw the excess liquidity and the pump into the financial system in the aftermath of the global financial crisis. the temper tantrum a few years ago was a warning of pressures to come in emerging markets. as we pretty prescient see that playing out. emerging markets are not nearly as vulnerable as they were 20 years ago in asia when there were no currency reserves. haidi: that goes to the argument that we are seeing a sentiment german selloff. always appreciate your time. stephen roach, senior fellow at yale university.
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we have plenty more ahead on daybreak asia. this is bloomberg. ♪ is bloomberg. ♪
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shery: this is daybreak asia am shery on in new york. i'm haidi stroud-watts in sydney. let's get you a quick check on the latest headlines. china's largest steel producer will produce government estimates to update the domestic steel sector. facing closureis of about 600 million tons of steel capacity over the next couple decades. become an he help manage that overhaul. plans to boost its capacity to 100 million tons. shery: a premium lithium project has an agreement to support test support tesla faces shortage of mineral use. it is recommending local
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authorities enforce a minimum spending obligation on at the site. tesla signed a deal on the project back in may. haidi: as we count down to the market open, this friday's session let's look at the stocks we will be watching. certainly what sophie is watching for us. sophie: i am keeping an eye on korean builders like gs engineering, as the government takes measures to tame surging home prices which have not cold despite president moon taking office. round of be the ninth cooling measures and the major conundrum for the government. we summons popularity sink below 50% for the first time last week as home prices hit a record. in tokyo, keeping an eye on nintendo. they announced plans to release the animal crossing game for the switch in 2019. toyota,the radar, raising its global production
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target by 2% across the group, production.mestic it should increase demand -- increase output by 60,000 units. the new camera, that is also picking up demand in china. shery: thank you so much. the market open in japan, south korea and australia just ahead. we saw on japan's nikkei fall in the last session, right now, futures looking higher. nikkei futures up 8%. we did get the markets in the u.s. -- up .8%. dow gaining for a third session. a rally in tech in the u.s.. nasdaq was gaining and apple rising after yesterday's product launch. take a look at this. most futures in asia looking in the green. new zealand down .2%.
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market bring you the open next. live from new york, sydney and hong kong, this is bloomberg. ♪
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save. for a limited time get 150 dollars off and free shipping too. sale prices are available right now. go to buyleesa.com today. you need this bed. haidi: good morning. good evening i am shery ahn. sophie: and i am sophie kamaruddin in hong kong. welcome to "bloomberg daybreak: asia." ♪ >> asia-pacific stocks look to extend the rally after wall street -- tech drove wall street higher. emerging markets and currencies as well as turkey hikes forecast president erdogan demanding a
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cut. >> a defiant tone ahead of possible new trade talks saying he feels no pressure to deal with china. >> click at the market open here is sophie kamaruddin. sophie: asia center teeing up for more optimism albeit a cautious tone. we do have a likely trade talk being marked by trump's latest week. we do have the nikkei 225 at a percent at the start of the session back above the 23,000 level. we have industrials leading the chart in tokyo. simcoe for example gaining 4% at the start of the session. the dollar-yen is back above 112% -- 1.12. we have some optimism around korean relations as well. that has been officially open in the northern border town. this is ahead of the talks to take place next week.
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over in sydney we are seeing muted gains but we are seeing losses for the -- losses by 2/10 of a percent. let's check in on currencies as we have the aussie underperforming. is strengthening slightly on uptick for the pmi for august the new zealand. the offshore yuan is holding steady as we wait on retail sales output and asset investment for china. we are anticipating a slight improvement in august activity. checking and the turkish lira, giving up some of its recent gains about six points up against the dollar. -- see an uphill battle. haidi: let's get you the first world news now with jenna dagenhart. jenna: president trump says he feels no pressure to resolve the trade dispute with china. in its we he said it is beijing that is feeling the heat on making a deal and it appears that they appear to be in
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different as to whether further talks happen. it suggests that president trump is determined to enter new negotiations but not really serious about striking a deal. malaysian police say they found more than 900 70 million u.s. dollars in a personal account. 1mdb saysigation into the cash was funneled through three channels in a total of 132 transactions involving 64 people. they deny any wrongdoing -- najib denies any wrongdoing. his lawyer has been charged on four counts of money laundering. eric has reached the carolina coast bringing son wins -- florence has reached the carolina coast bringing strong winds. it is forecast to deliver more than a meter of rain and four meter storm surge. it has been seen causing damage worth $20 billion.
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more than a thousand flights have been canceled. duke energy says 3 million people could lose our. meanwhile, the philippines is bracing for its most powerful typhoon of the year. it to late expect the northern province on saturday with the same wins, 265 kilometers an hour. has been rated a super typhoon and is projected to maintain that strength when it makes landfall. thousands of people have been ordered to seek shelter and government offices and schools are closed. global news, 24 hours a day, on-air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. i am jenna dagenhart, this is bloomberg.. shery: thank you. turkey boosting its rates more than excited a noble set that boosted the lira and showed its independence not been compromised by president erdogan . kathleen hays has the story. run us through the hike.
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president erdogan must not be too happy right now. >> he does not think increases are going to start inflation. he things in fact they will make -- it will make inflation worse. it is serious of the economy works. nevertheless a be rt, the central bank of the republic of turkey boosted its key rate by six at a quarter percent at 24% jumping to look at the bloomberg gtb chart. here is the latest move in a year when the moves had been substantial up to 24%. they did change their overnight rate to their weekly rate. there is a little confusion there. nevertheless, this move was bigger than expected and clearly the central bank means business. you can see how the lira has been recovering a little bit of a pullback there, they seem to be getting done what they need to do. itt is -- what does erdogan say about this?
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he doesn't think i interest rates cause inflation. those who disagree do not know their business and finally, in another very surprising move to turkish businesses, he bent them from using dollars and euros in business transactions. them from using dollars and euros in business transactions. markets,erging especially currencies, they did jump after the raised hike -- rate hike. you showed us there was a pullback on the lira. >> it is different for every country, there is an idiosyncratic story. we do have the msci emerging-market currency index showing a little bit of a move up there. there is not exactly a correlation but you can see how that rate hike announcement corresponds to that. nevertheless, if you look at individual stories, brazil real we can today. -- it weakened today. more surgery for his gunshot wounds from a rally, russia's
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central bank may need to bring back emergency funding and investors are pricing in at least 75 basis point of rba rate hikes. inflation has fallen but people are concerned about the currency that is on the table as well. >> there are doing a little bit better. optimism hundred talks. also the data dump expected today. >> to stick a quick look because the concern about trade is not just politics and trade it is what it does to the chinese economy which is so dependent on exports. let's look at the numbers we will be getting because all investors will be focused on these. we have retail sales have welcomed down a long way from the heyday. and they fall further? a 20% in either country would die for that. you're supposed to say party flat -- stay about pretty flat at 6%. deleveraging all kinds of things in the economy at once. as we look at the yuan and asian
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currencies, we will be watching this very closely. haidi: think is a much for that. let's get over to hong kong now joining us from there is union bank are -- prepping banker ceo -- private banker ceo. that suck about the trade issue which is still a bit of a whiplash session and the u.s. market overnight. has president trump again kind of saying it is a big deal if they do not get a deal with china essentially hurting china more than it is hurting the u.s.. that is a chart that i am looking at. we are expecting another 200 billion hike. perhaps the next movies to go all in. when i last spoke to you in april you said -- you were think when -- you are sanguine about the impact. have you grown more concerned since then? >> i think it is playing out as we expected. we expect the u.s. president to
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put pressure on china going into the november election. it is what is happening. real challenges that relate the next 200. if they do go on that puts a lot of pressure not only on china but also on the u.s. with think that is a line that will be very difficult to cross. haidi: as an investor what would you be advising people to do in terms of to be able to be -- to safely and opportunistically position the uncertainty? thingsof the interesting for investors right now is when we look at markets, we are to see our opportunities find protection around long exposure in equities around the world. i think that is really the most attractive way to participate in the market. we do want to be in the market because the underlying economy certainly in the u.s., but in other parts of the world, still remain quite strong. haidi: are hedge funds the way to go? we do think hedge funds are the way to go.
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not only when volatility is elevated but when we are starting to see what is -- and sectors within countries. performance is starting to come up. with to get in the tech sector in the course of the last few weeks and that means hedge fund managers have opportunities to pick stocks and really generate value for clients coming forward. haidi: this gtb go library chart for our bloomberg viewers just chose -- shows china versus u.s. tech valuations. has been getting hammered along with other asian equities bringing valuations to the closest levels to their u.s. peers in about 10 years. could we say that chinese tech has autumn doubt -- bottomed out? >> we think it is getting close. have been hurt by a number of things. not only the trade discussions but also company specific idiosyncratic events that are coming. todo think that there is any probably reduce some valuation expectations for the chinese
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sector -- tech sector. of the earnings picture we think is starting to become realistic and so, bottom thing here, probably not a bad idea. haidi: that stick a broader look at the recovery rally that got us -- got underway yesterday in asia snapping that longest losing streak that i think was outmatched in about 16 years. just a cautious ray of hope. get anotherybe we round of trade talks going on as well. arere talking early, valuations in asia to just just so cheaper now that we will see a sustained rebound? wewe would think about it, look at china in particular but generally in asia in emerging markets if we have a situation where these economies can stabilize here, and for china that means they probably could absorb tariffs on the 200 billion offset by some domestic stimulus, within the market is starting to price in a low 6% of
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growth rate in china which we think is reasonable and that's an area. that they have not priced in the risk of that in the near term. it is not that high. is a tariff on the full range of chinese exports going forward. haidi: what are your assumptions when it comes to how policymakers can react to a potential full range on the terrace on chinese goods -- tariffs on chinese goods? if we do continue to get this run on a strong u.s. dollar, how asian and emerging central bikes can really react. for most of these countries it is a sentiment driven selloff, not necessarily one being based on fundamentals. >> it is a sentiment driven selloff certainly but i think on top of that when we look at the borrowing emerging markets here it is driven by a number of things. you point out one of them which is the strong u.s. dollar. that has been pressuring them. oil prices in the high 70's has been hurting them.
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this means you have inflationary pressures that the massively they have to fight so interest rates are rising these economies . the trajectories will be a bit lower than most were expected at the start of the year and that is why these markets in the earnings -- earning outlooks for these markets are coming down. we look at china particular, we think china has enough policy to try and offset even the full range of tariffs should they come on full chinese exports. however, it will come at a cost. the council be it's deliberate -- deleveraging strategy. haidi: we want to get more on trade later on but let's talk about currencies were second. where we have seen the most impact when it comes to the trade tensions. in currency volatility has searched in the past few months after the trade tensions
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escalated. but of course, g7 currencies have stayed relatively calm. could we expect this to be the trajectory going forward? >> we do think that em currencies robert we will stay on the weak side as we go forward from here. largely because they are tightening in terms of interest rates. their fiscal positions do not allow them much possibility. i think for a lot of emerging nations they will have to rely on weak currencies and strong global growth to really keep their economies afloat here. i think looking forward we see stability more than anything. but then, should we see the dollar continued to strengthen, should we see oil prices continue to raise -- remain high and trade tensions say elevated, we think there is a weakening eye is across -- bias across the currencies. haidi: stay with us we have more to talk about. normanthe lumen --
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us.amin is staying with this is bloomberg. ♪
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shery: this is "bloomberg daybreak: asia." haidi: i am haidi in sydney. over proposed new run of trade talks between china and the u.s.. u.s. talks initially dipped up to president trump's tweets to dissolve the dispute showing his determined that she is determined to ensure -- enter the negotiation showing strength. steve, where do we stand? reporter: a lot of slack are coming from the president just a day after the positive overture from steve mnuchin. to the chinese to hold a new round of talks which would be the fifth round of talks. for donald trump tweeted that he feels the pressure to strike a deal with china and that he has the upper hand in trade negotiations. with this really does is it
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risks chinese beers that trump is not serious about striking a deal. back in may steve mnuchin thought they had a deal and donald trump the next day that he is going to impose those tariffs. china has felt burned. china is likely and where he -- wary of giving trump any kind of victory ahead of the upcoming midterm elections in november. donald trump wants to show he is being tough on china. who will give ground? i am a bit of a pessimist if you ask me because there is a lot of optics at stake here. trump hardline on china, really resonates with the industrial belt around the great lakes --tes but it also worries worries and the farmland stan -- farm land states with chinese retaliation. it is a delicate balance here. keep in mind china has not yet agreed to hold the next round of
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talks and that is key. the commerce ministry had his -- their weekly meeting yesterday, their regularly scheduled meeting and they basically had the chance to say yes, we welcome the talks. he did not. actually colette -- criticize this escalating trade war as a situation for all parties, and he said it is hurting the globe. the foreign ministry out of china did say that they will company round of talks but again, the chinese have not yet agreed. i think they are a bit wary. haidi: we will see how they react to the president's later tweets as well. thank you, stephen engle. so with us is norman villamin. chief investment officer at union bancaire privee. of course we feel -- we still do not have a resolution on u.s. china trade talks. if anything they could get worse. we do not have a trilateral deal on that -- nafta. they have also hinted that they could try to fix trade with
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japan. how much of all of this has been priced in? >> i think in regards to china you are starting to see price and fairly meaningfully. when we struck me on that whether we are talking about autos in europe or we are talking about the nafta agreement, the prospect of a breakdown in trade and the cost of -- associated with that really has not been priced into the u.s. market. haidi: we are out of earnings season and we really do not have much when it comes to a concrete data on corporate performance is doing. duringe expect at least the next few weeks for trade to be what moves markets? >> i think we have seen over the nest -- lusty porters or so is the trade issue has come to the front. earnings season is at the forefront, than the numbers there have been quite strong. as we step away from earnings
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season we shift back to the political realm. that is where the headwinds come in and the markets are a bit more choppy and more difficult for investors. norman, i want to look at the yuan, because in terms of it is interesting, president trump's suite takes aim at chinese assets versus the u.s. the yuan has done it good job of staying stable over the last few weeks. is this sustainable and use the currency is being something that could be weaponized as the next up in the trade war at least by the not -- an eclectic policy? >> we think the stabilization of the yuan make sense here. it is pricing pretty well this next round. this $200 billion leading -- the chinese can absorb some of the cost be a domestic stimulus to saturn terms of growth. however, if that u.s. moves in terms of the next round of terrorists going to the full 500
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billion than the risk is the chinese will really set a little bit more. in addition to some or the xml us. at this point, we see the yuan range down here. haidi: sorry continue. >> we see the yuan range found here -- range found here until we moved to the third stage of tariffs out of the u.s.. haidi: in terms of looking at this from the prism of diplomatic and international relations aspects of policy coming from the united states and how that is having economic and market implications quite clearly, turkey is a good example, you're also worried about iran and further sanctions on russia. to what extent is all of this very destabilizing and our markets uprising sufficiently for the -- not pricing sufficiently for that? >> i would characterize it as we believe that the trump administration instead of focusing on the economy and economic policy as an anchor for
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setting its foreign policy, that is the case for previous a ministrations, they are really focusing on political objectives and how they want to reshape the political landscape. if you like taking economics as the outcome. and strategist looking at markets, it is really understanding the political objective that they are trying to for caps on -- focus on. that type of risk is not present to markets and that is what we are doing a lot more in the hedge fund space managing volatility than we have done in the past. been talking all week about it's been 10 years since lehman. happen a lot of lessons learned. it is human nature to forget a lot of the trauma of the past and to repeat the same mistakes of history. you think we are setting up for potentially risky downturn either stemming from china or emerging markets or if you look at the yield curve you can argue that the next risk still comes
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from the u.s.? >> i think as we have seen it in the past the cycles never reflect what we have seen completely in the past. i think what we do have right now is similar situations and there is quite a -- quite a lot of leverage around the world. policymakers are tightening in the risk of a policy here this time out of political realms is starting to increase. it is warranted for investors to be more cautious and more thoughtful about how they are taking risks and how they are protecting portfolios. haidi: norman, great having you with us. union bancaire privee. -- banking cio. more to come on "bloomberg daybreak: asia." this is bloomberg. ♪
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haidi: here's a track of the latest business flash headlines. say they will result in unspecified job losses and cba.
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they recognize the need to simple fight and strengthen the operations but did not mention potential job cuts since taking over in april, matt has moved to reshape cba and focus on its core retail and banking loans. ck infrastructure may less comedic assets in london. the company is talking to investment banks about a multibillion-dollar fund. discussions are ongoing and may not lead to a deal. to get infrastructure has been stable over british assets. hutchinson has infrastructure assets in australia, germany, and canada. coming up, we are live at the asia summit in singapore with linkedin management director olivier legrand. the outlook for job seeking in the region coming up next. life from new york, sydney, and hong kong, this is bloomberg.
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thursday kind of continuing to head into the weekend. i am haidi in sydney. shery: i am shery and in new york. you're watching "bloomberg daybreak: asia." here is that josh debt jenna dagenhart with the personal deals -- business news. the bank will buy the equivalent of $17 billion assets a month from october to december. the policy after that continues to be contingent on data. officials launched the repeated that --
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risks are broadly balanced. , risks relating to rising protectionist and emerging markets and financial market volatility have gained more prominence recently. jenna: sterling rose to its highest against the dollar in six weeks. this is a u.k. government pledged to provide more information that could resolve the post-brexit border with ireland. sources that eu officials are rewriting a key part of the potential to -- agreement to try to make it more palatable to the u.k.. it will find an outline of the brexit accord. reports from london say bank of england governor mark carney gave senior ministers a stark warning about the danger of failing to secure a deal on brexit.
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the times says he joined a cabinet meeting on plans for a no deal outcome and said crashing and chaos could drive housing prices down 35%. the guardian said carney warned that no deal would be a catastrophic as the 2008 financial crisis. a gauge of underlying u.s. inflation unexpectedly pulled in august. prices fell by the most in seven decades and medicare costs also declined. this adjust little urgency for the fed to speed up the pace of rate hikes. the budget deficit widened to $900 billion in the 11 months through august that exceeds the forecast for the fiscal year of the trump residency. one of the best known investors and digital currencies has caught a bottom in the crypto crash of 2018. a snapshot of the index which measures currencies involving bitcoin and the narrow. ony suggest it hit a low
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wednesday. most grip those are now trading are now- most cryptos trading higher. global news, 24 hours a day, on-air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. dagenhart. this is bloomberg. haidi: thank you. markets are shaping up so far this friday, here is sophie. sophie: we are ending this week on a high ahead of the weekend. valuations are at a two-year low. some investors are waiting back in and chipmakers are the biggest boost to the cost beat which is adding 1.4%. kospi which is adding 1.4%. the jobs market does remain above for the government. finance minister in an interview with kbs at the september jobs data is expected to have some bad. numbers. today, we are seeing some here for korean accidents -- assess.
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-- assets. that could be over momentum for chinese stocks and a decent earnings outlook. the japanese cabinet office, the cb economy recovering at a moderate pace and hitting -- the export recovery and the government has upgraded its feel business investment in japan to increasing. in sydney, they are set to step up to the decline while the aussie dollar is underperforming. the kiwi is strengthening slightly. the ndx 50 is losing ground attempt of 1% -- a 10th of 1%. i want to give it up with one over in tokyo. asto got falling as much 18.5% after surging 27% on thursday. the japanese furniture making faces continued operating losses and last month it was involved
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in negotiations with a potential sponsor perhaps there might not be a resolution on that front just yet. we have nintendo extending losses for a second day. the company has no plans to launch the animal crossing game for the switch in 2019 but it soes not look like investor have sentiments for nintendo today -- to date. shery: think is so much. sophie kamaruddin in hong kong. think you so much. -- thank you so much. reporter: i am here with the linkedin managing director and bp vp. olivier legrand.
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lets the of the growth can continue in this uncertain environment. think is much for joining us. you were just telling us you are still seeing that, to new users every second on your platform. how long can that kind of growth continue? >> think the opportunity is massive. -- i think the opportunity is massive. where talking about 3.3 billion people that will be looking for all sorts of opportunity, job, financing, this tradition, everything that is happening every day on the lenten platform. everything that is happening every day on the linkedin platform. reporter: linkedin is raising every year with users. you're going to keep your number of influences capped at 500. you are seeing clinton being used as a platform for political
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messages as well. same as what we are seeing on twitter. >> it is really all about business not political. building business connections in gaining access to professional content, learning inwell more and more, bringing an acquiring skills that will be important for individuals to stay relevant to their job and to the future of their job. we are seeing that as being the most important. reporter: how are you addressing concerns about potential usage being compromise? -- been compromised like cambridge analytica? >> security is our number one priority. we do it in multiple ways. to have very clear policies and how the platform needs to be used and is supposed to be used. we do not tolerate fake profiles and we are making sure that our teams are there -- safety teams are there to control that. what we are about is really connecting those professionals and having them get opportunities.
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we recently pundits -- published an emergent jobs report in singapore and australia. we are focusing on really helping our members with their future and the protect -- and the professional context. reporter: how much do they have to pay for? >> we cater our premium for people that in a specific moment in their journey, whether they are actively looking for a job or if you are a business developer, you have a deepening of reaching out to third party companies. really tailoring it to special uses cases. we want to create value for all of our premium members day in and day out. seeing what are not your actual earnings are. how is it going in terms of revenue growth and asia? >> the business is doing really well at a good pace both on the membership site and revenue
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said. connectiondirect between our vision and monetizing. overall we are very happy. if you look at microsoft earnings they often talk about our contribution and positive contribution to their business. reporter: there one of the few websites that is not locked by china. you're seeing a lot of growth there moving into that market where essentially people are using a different language to use your platform as well. >> the platform is in 27 differently which is so language is something that we know a little bit about. china has also a little -- a different culture. we have put in place a team in china that is bringing the proposition of linkedin to chinese members but also introducing features that allow us to develop faster in the chinese market. we have no 43 million members in china. we will continue to have those professionals and connect them with opportunities as long as we are focused on the mission, we know that we create value for
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those members and we know that our company grows. reporter: if you look at countries like the philippines, vietnam, are you seeing a lot of uptrends there in those countries? >> yes. students. particularly in india and southeast asia, they are very important. the new members that you were , the two members per second were mentioning. at acquisitions sides of what we have to offer. is a really important cohorts for us and we worked a lot to ring them -- bring them the right product. reporter: your head of -- your head of linkedin india just quit recently. are you replacing the position? >> of course we are planning to replace that position. india is a very important market for us. i spend a lot of my time in
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india which is amazing and knowing india, we are very actively looking for a replacement. reporter: if i was just seeking in asia what some of the fastest growing jobs? >> data scientists. to be honest, it is a job that is emerging in many places around the world. we are seeing more and more user experience designers, digital is very important, content marketers and content specialists are very important. sever security experts as well. -- cyber security experts as well. these jobs require high risk yields. there is also a lot of skills required to fulfill those jobs and to be successful in those jobs. our advice is if your technical, acquire the subscales -- if you are technical acquire the skills. they are obviously in very high demand. reporter: is a much for joining
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us olivier legrand. linkdein maganing director and vp. think is so much yulia sally for that. happening right now amazon ceo jeff pesos is speaking to david rubenstein -- jeff bezos is speaking to rate -- to david rubenstein. we will continue to monitor the conversation and bring you some of the highlights. if you want to tune in you can watch the full event at our terminal at life go -- life go -- at live go. this is bloomberg. ♪ >> when the stock is down 30% a month, will not haidi: on the next episode in
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our belton road special is at
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7:00 hong kong time. projects look at how kit -- ang the look delicate balance in politics and economic development. >> what will the countries that stand to gain most in the alton ton road initiative is kazakhstan. betweencountry lost ashlock to between china and russia in the center of a thousand acts between geopolitics and economic advancements. they are an ultramodern city dominantcentral asia's economy. [indiscernible]
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>> we are naturally the first country that lies to the west of china as we go toward europe. we have built our own infrastructure even before the initiative we launched. we have built 2500 kilometers of railroads. >> one of the key things for us is that we are trying -- a transit country. transit is a very good way of making money. is a lens doing business. we have diversified our transportation routes and provided for various alternatives not only going north, west, but also felt. -- but also south. border withstan's china, the plans to build the road.s largest
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everything,n nearly plus a by rail from china -- b i-rail from china. >> the chinese invested into that 50-50 with us. we have a train now back in trouble from the east of china to -- through china to kazakhstan to istanbul in about two weeks. >> people have said that kazakhstan will be the focal of e of the beltuckl but there are challenges before that can happen. -- havee synchronized sigrid's railroad tariffs. we have not only built -- we have synchronized railroad tariffs but we have also created
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-- removed barriers were trade. trade. haidi: you can catch the full episode at 7:00 in hong kong. happening right now in washington, jeff bezos is speaking to david rubenstein at the economic talks, he just launched his $2 billion fund to help the homeless. let's listen in. >> i started it when i was two years old. the main complaint to my mother andi was to task focused she cannot get me to switch tasks, my teacher. she asked the people to work with me -- if you ask the people who work with me they would say that is still probably to. --true. i do not know any of my school
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teachers -- >> you will have some sort of preschool for children who need preschool. >> full tuition preschool, mona story inspired. i will operate that. that will be an operating nonprofit. i will hire an executive team will be a leadership team. we will operate b-schools -- these schools and we will put them in low income neighborhoods. if a child. i did it is really hard to catch up. if you can get somebody -- of a child falls behind it is a really hard task to catch up. because the happen to you have to improve their odds. most people in this room have been very mindful about making sure that their kids got very good preschool educations and
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got that kind of head start. that headstart compounds fantastically if you can get that starting at age 2, 3, 4. there is a powerful compounding effect their. it is highly leveled -- highly levered. the money spain there will pay -- the money spent there will pay dividends for decades. >> the other part of the gift will be to give more awards out. >> that will be more traditional grant making philanthropy. i will identify with the help of a team, i will identify that we will hire every full-time team, identify and fund that, and fund family homeless shelters. >> you said he would give an initial $2 billion. do you expect to add to that? >> anything have ever done has started small. amazon started with a couple of people.
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five people. the budget was really small. now the budget approaches a billion dollars a year. the next year it will be more than a billion dollars. in amazon, today it is half a million people. it is hard to remember for you guys but for me, it was like yesterday -- it is like yesterday. i was driving packages to the post office myself, hoping one day we could afford a forklift. for me, i have seen small things become big and it is part of this they want mentality, i like treating things as if they are small. amazon, i want it to have the heart and spirit of a small company giving if it is a large one. the day one foundation will be like that. too,ll wonder a little bit we have various specific ideas that we want to do but i believe in the power of one drink. -- wandering.
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all of my best decisions in life have been made with heart, not analysis.s, when you can make a decision with analysis, you should do so. but it turns out in life that your most important decisions are always made with instinct, intuition, taste, heart, and that is what we will do with this day one foundation. it is part of that they want mentality. as we go about building up this network of nonprofit schools, we will learn new things and we will figure out how to make it better. >> one of the decisions were making, when a customer will be the child. >> this is so important because there are several principles and amazon but the one thing that has made a successful by far is obsessive-compulsive focus on the customer as opposed to
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obsession over the competitor. i talk so often to other ceo's and other ceo's, founders and entrepreneurs, and i can tell that even though they are talking about customers they are really focusing on competitors. and it is a huge advantage to any company if you can say focus on your customers -- stay focused on your customers instead of your competitors. so who is your customer? the washington post is a customer of people who buy advertisements from us? know. the cost of -- no. the customer is the reader. where do advertisers want to be? advertisers want to be where there are readers. in the school, where the customers? the parents? the teachers? know, -- no, it is the child. will be obsessively compulsively
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come from -- folks -- focus on the child. >> when we use your intuition to make decisions, where is it leading you know on your second headquarters? [laughing] >> can we just take a moment to knowledge that that may be the gway intoe -- se history of interviewing? [laughing] ]applause' >> seriously, david. that is hilarious. their tape -- the team is working their butts off on it and we will get there. come on, be nice. you already have something in
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one washington and what about another washington area? >> that's right. in seattle, we call this the other washington. >> speaking of washington, you bought a few years ago the washington post. why did you buy the washington post? you had no background in that area. will convince you to do that? >> -- what convince you to do that? >> it never occurred to me. it was not like childhood dream -- it was not like a childhood dream. my friend of 15 years of the time, he approached me through an intermediary and wanted to know if i was interested in buying the washington post. i said that i would not because i did not really know anything about newspapers. and my friends over a series of conversations, convinced me that -- haidi: that was jeff bezos
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speaking with david rubenstein at the economic talk in washington. he was talking about the success of amazon saying that they ofrted small but they -- the session was with customers, not with their rivals. when asked about the second headquarters of course, we know that there are 20 including new york, l.a., miami, he did not give any more details but he just said that the announcement will be made by the end of the year. hisas also talking about work of course, he just launched a $2 billion fund to help the homeless. thei: these $2 billion is to runtwo have you plans the preschools, the company, they will be run as essentially as businesses rather, they will be holding -- looking for executives to run them and oh -- they will be compulsively focus on the students there to help out. as alyssa homeless situation in seattle. earlier he was -- as well as the
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homeless situation. he was talking about housing. when the share prices go up 30%, it is important to talk about yourself as 30% -- think about yourself as 30% smarter. we will continue to watch out for that and of course, if you want to tune in and watch it in full it is that life go on the go on the- live terminal. the second quick look at our markets -- how markets are trading at the moment. you're in asia, the nikkei 225 up by just about 1% there. were also seeing good gains across australia as well as south korea. hong kong market opens our next. -- are next. ♪
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rishaad: 9:00 a.m. in hong kong and singapore. z . am rishaad salamat david: this is "bloomberg markets: china open." ♪ rishaad: asia pacific stocks rally anda u.s. tech new optimism about trade talks. david: emerging markets and

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