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Speaker 1: This is Bloomberg Daybreak here for this Wednesday, the nineteenth

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Speaker 1: of April in London. Coming up today, seven hundred and

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Speaker 1: eighty seven million dollars. Fox settles with Dominion over bogus

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Speaker 1: claims that it rigged the twenty twenty presidential election. All

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Speaker 1: that glitters isn't Goldman. The bank's traders miss out on

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Speaker 1: Wall streets, fixed income boom less than a stream. Netflix

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Speaker 1: shares drop ten percent as new customer sign ups miss estimates.

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Speaker 2: Top investor details plans to split HSBC, coinbase, plot to

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Speaker 2: move here to the UK, and central London house prices

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Speaker 2: take a big hit. Those other stories we're looking at

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Speaker 2: in today's papers.

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Speaker 3: And I'm Leam Gerrins.

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Speaker 4: Plus we're live at the Bloomberg New Economy Gateway Europe

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Speaker 4: in Ireland where the easybas Philip Blaine has told us

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Speaker 4: he expects another.

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Speaker 5: Hike in May.

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Speaker 6: That's all straight ahead on Bloomberg Daybreak Europe. The business

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Speaker 6: news you need to start your day in just one

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Speaker 6: fifteen minute podcast on Apple, Spotify, the Blueberg Business App

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Speaker 6: and everywhere you get your podcasts.

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Speaker 4: Good morning, I'm Stephen Carroll.

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Speaker 1: And I'm Caroline Hetger. Here are the stories that we're

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Speaker 1: following today. Fox News has agreed to pay over three

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Speaker 1: quarters of a billion dollars to settle a defamation lawsuit

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Speaker 1: over the twenty twenty presidential elections. Dominion accused the USTv

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Speaker 1: network of airing bogus claims that it rigged the election

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Speaker 1: against Donald Trump. Here is Dominion CEO John Pulus.

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Speaker 7: Fox has admitted to telling lies about Dominion that caused

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Speaker 7: enormous damage to my company, our employees, and the customers

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Speaker 7: that we serve. Nothing can ever make up for that.

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Speaker 1: The settlement is about half of what the Dominion CEO

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Speaker 1: was seeking and avoids a potentially embarrassing six week trial

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Speaker 1: for Fox. Fox argued that its broadcasts work at collected

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Speaker 1: as free speech under the First Amendment. In earnings, Gold

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Speaker 1: and Sax traders have failed to capitalize on a fixed

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Speaker 1: income bonanza. The Wall Street Giant was the only major

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Speaker 1: bank to post a decline in the division, with first

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Speaker 1: quarter fixed income trading revenue dropping seventeen percent. Total revenue

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Speaker 1: also fell short of analyst estimates, but CEO David Solomon

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Speaker 1: says the bank is well positioned for the future.

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Speaker 8: As we sit here today, it appears that the worst

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Speaker 8: of the volatility is behind us. While it's impossible predict

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Speaker 8: the exact form of market stress will take, and we

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Speaker 8: won't always execute perfectly, our risk management culture, strong liquidity,

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Speaker 8: and robust capital position have allowed us to navigate a

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Speaker 8: complex environment while also continuing to actively support our clients.

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Speaker 1: Solomon says the events of the first quarter demonstrate the

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Speaker 1: resilience of Goldman Sachs and the US's largest financial institutions.

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Speaker 1: Elsewhere on Wall Street, a Bank of America also reported earnings.

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Speaker 1: Traders there saw a thirty percent jump in fixed income

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Speaker 1: revenue for the quarter. Netflix though miss Wall Street estimates

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Speaker 1: after adding only one point seventy five million new customers

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Speaker 1: in the first quarter. More on that story now from

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Speaker 1: Bloemberg's Charlie Pellett.

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Speaker 5: Investors were expecting two point four to one million new customers.

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Speaker 5: Netflix also predicted it will generate lower sales and profit

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Speaker 5: in the current quarter than what analysts had forecast. It

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Speaker 5: sees new customers in the current period as roughly similar

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Speaker 5: to the first quarter, and Netflix will begin cracking down

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Speaker 5: this quarter on US viewers who share someone else's account,

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Speaker 5: predicting plans to charge such customers will boost growth in

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Speaker 5: the second half of this year in New York, Charlie

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Speaker 5: Pellett Bloomberg Daybreak Europe.

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Speaker 1: The UK's rate of inflation is forecast to drop below

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Speaker 1: ten percent in March, according to analysis from Bloomberg Economics.

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Speaker 1: Our senior UK economist Dan Hansen has the details of

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Speaker 1: what we can expect in today's data.

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Speaker 6: You'll be getting some information about what happened in the past,

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Speaker 6: will be a little bit information about what's happened with

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Speaker 6: energy prices as well, but we are still expecting the fall.

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Speaker 6: We're expecting a fall to nine point eight percent.

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Speaker 1: Dan Hansen's projection comes after figures showed that UK wage

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Speaker 1: growth unexpectedly accelerated. Average earnings excluding bonuses rose by six

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Speaker 1: point six percent in the three months through to February

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Speaker 1: compared with a year ago. We had that data out yesterday.

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Speaker 1: The ECB's chief economist says that he expects the Central

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Speaker 1: Bank to raise rates at next month's meeting. Speaking exclusively

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Speaker 1: to Bloomberg, Philip Blaine said that the size of the

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Speaker 1: move will be dependent on data due in the coming weeks.

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Speaker 7: Q one suggests we are seeing reversal of the negative

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Speaker 7: supply sharks that so dominated the ear of the economy

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Speaker 7: last year, so easing of bottlenecks, much lower gas prices.

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Speaker 7: So what I would say from all of that is,

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Speaker 7: as of now two weeks away, I think the baseline

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Speaker 7: is that we should indeed increase interust rates.

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Speaker 1: In May, Philip Blaine made those comments in an interview

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Speaker 1: with our head of Economics, Stephanie Flanders, at Bloomberg's inaugural

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Speaker 1: New Economy Gateway Europe event in Ireland. Gold and Sachs

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Speaker 1: economists have now also lifted their forecast for where ECB

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Speaker 1: rates will settle. They see a terminal rate of three

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Speaker 1: point seventy five percent. Federal Reserve Bank of Atlanta president

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Speaker 1: Raphael Bostic says that he favors one more twenty five

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Speaker 1: basis point rate increase before holding at five percent in

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Speaker 1: the US. Speaking to CNBC, he said that there's more

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Speaker 1: work to be done, but added that tighter credit conditions

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Speaker 1: may take care of some of that. Speaking elsewhere this

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Speaker 1: Saint Louis FED President James Bullard is calling for two

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Speaker 1: more hikes. He told Reuters that he believes fears of

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Speaker 1: a recession are overblown. Bullet and Bostick don't have a

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Speaker 1: vote on monetary policy.

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Speaker 5: This year.

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Speaker 1: But of course all FED policy makers participate in rate discussions.

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Speaker 1: So that is a roundup of today's top stories for you.

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Speaker 4: Now.

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Speaker 1: Stephen Cowell is not in the studio with me this morning.

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Speaker 1: He's at Land, of course, for the Bloomberg New Economy

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Speaker 1: Gateway Europe event. Good morning, Stephen, great to have you there.

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Speaker 1: You actually just outside of Dublin. So where are you exactly?

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Speaker 4: Good morning, Caroline. So I'm in the Powers Court of State.

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Speaker 4: We're about twenty kilometers south of the center of Dublin

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Speaker 4: City in the beautiful county Wicklow, often known as the

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Speaker 4: Garden of Ireland. So this is a place that has

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Speaker 4: a history of settlement dating back to a thirteenth century

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Speaker 4: medieval castle. I'm going to paint you a picture of

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Speaker 4: what we're looking at here for this event. The current

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Speaker 4: Powers Court to State House dates back actually to seventeen

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Speaker 4: forty one. It was rebuilt after a major far in

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Speaker 4: the seventies. We're talking about a big manor house overlooking

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Speaker 4: some absolutely spectacular gardens, about forty seven acres of gardens here.

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Speaker 4: There's an Italian garden, a Japanese garden. It's also home

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Speaker 4: to Ireland's highest waterfall, one hundred and twenty one meters

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Speaker 4: high and by National Geographic has voted it the number

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Speaker 4: three garden in the world. So I have a very

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Speaker 4: picturesque spot to broadcast from this morning. I'm just wait

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Speaker 4: for the sun to come up as we're talking to

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Speaker 4: you over the Sugarloaf Mountain here in Wicklow. This is

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Speaker 4: an absolutely stunning setting. People come from all over the

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Speaker 4: world to visit this place, and we're here with a

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Speaker 4: lot of very interesting speakers for the next couple of days.

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Speaker 7: Yeah.

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Speaker 1: Absolutely. We prought you just a bit of Philip Blane

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Speaker 1: of the ECB, who's been speaking to us ahead of

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Speaker 1: today's events. So who's going to be there. What are

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Speaker 1: going to be the big discussion points?

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Speaker 4: Well, look, the idea of these Gateway events is to

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Speaker 4: discuss regional issues with public and private sector leaders. So

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Speaker 4: we're talking here at this event about reglobalization. We've got,

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Speaker 4: of course, all of the geopolitical stresses that have faced Europe,

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Speaker 4: you know, not least of the war in Ukraine, but

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Speaker 4: also the issues around trade, around supply chain bottlenecks, technology challenges,

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Speaker 4: competition between Europe and China, Europe and the United States.

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Speaker 4: We've been talking about the Intallation Reduction Act in the US,

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Speaker 4: and this whole wave of green subsidies that's become a

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Speaker 4: huge issue between the major economic powers of the world.

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Speaker 4: So those are some of the things that we're going

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Speaker 4: to be talking about here. We've got the CEO of

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Speaker 4: one of the big semiconductor makers, NXP, Kurt Sievers, is

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Speaker 4: speaking here later this morning. We're also going to be

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Speaker 4: hearing from another central banker, Maria today is going to

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Speaker 4: be speaking to the Governor of the Bank of Spain,

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Speaker 4: Pablo Hernandez to cast a little bit later on too.

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Speaker 4: We're also going to be looking at the issues facing

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Speaker 4: companies here in Europe, things like the collapse of SVB.

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Speaker 4: What does that mean for venture capital funding in Europe

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Speaker 4: and for the burgeoning startup scene that so many countries

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Speaker 4: across this continent are trying to encourage and also to

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Speaker 4: support their economy that way as well. So we have

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Speaker 4: some big public speakers, but some big private sector speakers

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Speaker 4: as well.

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Speaker 1: Yeah, gosh, that sounds like a great line up. I

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Speaker 1: it's only a couple of weeks ago that Credit Suisse collapse,

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Speaker 1: and yet that blip sort of seems to have passed.

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Speaker 1: So many issues to discuss, but also I think a

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Speaker 1: big moment to think about Europe post Brexit also, of course,

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Speaker 1: and there's a very nice piece on the terminal today

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Speaker 1: about the competition amongst European Union cities, including Dublin of course,

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Speaker 1: to try to make the most I suppose of the

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Speaker 1: jobs that may come their way, the investment. It's a

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Speaker 1: much more fragmented landscape, isn't it in terms of finance

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Speaker 1: within Europe now?

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Speaker 4: Yeah, And look, Andre Rchelf from Uniqredit is the first

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Speaker 4: speaker up here this morning. He's going to be talking

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Speaker 4: to Francine Laqua and that's part of the landscape that

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Speaker 4: we're talking about, the background to this event. I mean,

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Speaker 4: if you just think about Ireland, Ireland is now the

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Speaker 4: sixth largest exporter of financial services in the world, ahead

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Speaker 4: of the likes of France. And part of that is

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Speaker 4: due to Brexit, because we did see so many financial

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Speaker 4: services organizations but also even outside of that, the legal

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Speaker 4: professional professional services choosing to relocate or to expand. If

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Speaker 4: they're not moving people from London, the idea that they're

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Speaker 4: expanding in other countries in Europe, and that's also a

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Speaker 4: challenge the continent has had to face too, they're looking

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Speaker 4: at a more splintered financial sector, more centers growing up.

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Speaker 4: But this reporting on Paris really interesting to see how

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Speaker 4: much the French capital has attracted and those big name

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Speaker 4: American banks among them, who've chosen to expand and hire

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Speaker 4: much more in Paris to ensure that they have a

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Speaker 4: presence in the European Union.

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Speaker 1: After breakxfast, absolutely okay, Stephen, thanks so much for being

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Speaker 1: with me. You'll be back later on in the program.

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Speaker 1: Of course, Stephen cow there for us live in Ireland

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Speaker 1: this morning at the Bloomberg New Economy Gateway Europe event.

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Speaker 1: Much more on that. Having said that, I want to

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Speaker 1: return to the top story that I was discussing this morning.

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Speaker 1: No need for Fox executives such as Rupert Murderdoc to

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Speaker 1: take the witness stand, no embarrassing trial. Fox News has

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Speaker 1: settled a lawsuit with Dominion Voting Systems for about half

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Speaker 1: the one point six billion dollars in damaged damages that

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Speaker 1: Dominion was actually seeking. Joining me now to discuss this

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Speaker 1: is Bloomberg's Derek Walback. Great to have you on the program, Derek.

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Speaker 1: So all of this relates that a case over the

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Speaker 1: TV network's twenty twenty election broadcast. This was set to

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Speaker 1: be a huge defamation trial. But now there's been a settlement.

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Speaker 1: What have both sides been saying this?

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Speaker 9: There has been a settlement, and it is a very

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Speaker 9: very large settlement, a seven and eighty seven point five

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Speaker 9: million dollars, a number that is you know the size

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Speaker 9: of an airplane, right, you know, it's it's very very large.

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Speaker 9: You don't generally see settlements of this of this size.

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Speaker 9: The two parties are a little bit split in terms

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Speaker 9: of how they're framing it. Dominion said, you know, truth matters.

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Speaker 9: They said that Fox's broadcast had created a quote alternative

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Speaker 9: universe that caused quote grievous harm to Dominion and the

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Speaker 9: company Fox. However, I thought it was a very interestingly

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Speaker 9: worded statement. Quote we acknowledge the court's rulings finding certain

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Speaker 9: claims about Dominion to be false.

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Speaker 6: Is how that is.

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Speaker 9: How that started. It went from there, So two very

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Speaker 9: different framings. It wasn't something that was brought up a lot.

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Speaker 9: It was brought up a little, but not a lot

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Speaker 9: in Fox's actual broadcasts going forward. Other rival networks covered

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Speaker 9: it far more aggressively afterwards, as they had indeed throughout

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Speaker 9: the entire case.

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Speaker 1: Yeah, what do you think that it shows or highlights

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Speaker 1: of anything about I suppose the political media landscape in

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Speaker 1: the US. How does this, as I say, what could

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Speaker 1: have been this enormous trial, sort of play into that

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Speaker 1: to Fox to reput murder and so on.

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Speaker 9: Well, there's a couple of things that I think are

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Speaker 9: really important about this. Number one is that it will

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Speaker 9: remain to be seen if there's a blood in the

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Speaker 9: water effect here, if other companies that feel like they

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Speaker 9: have some grievance with the way that Fox or others

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Speaker 9: along an ideological reporting spectrum decide that they want to

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Speaker 9: go press some of their own case. I mean, I

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Speaker 9: think there has been a recent move to more aggressively

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Speaker 9: try and test the limits of defamation and media. You know,

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Speaker 9: I'm thinking back to the Gawker case that that wound

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Speaker 9: up effectively shuddering that, you know, some of that operation.

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Speaker 9: So I do think that that is something that's going

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Speaker 9: to be explored a little bit more. I also think,

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Speaker 9: at the same time, this prevents another high profile test

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Speaker 9: in open court of where the limits are of media

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Speaker 9: and defamation rules. In the United States. There's a there's

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Speaker 9: a rule that basically comes to an actual malice standard.

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Speaker 9: In the US, it's not enough to say something is

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Speaker 9: wrong and that that was bad, but you actually have

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Speaker 9: to prove essentially that it was knowably false, that someone

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Speaker 9: knew that it was false, that they did it anyway,

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Speaker 9: and that that rises to a malager malice or negligence

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Speaker 9: of malice sort of standards. So it's higher in the

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Speaker 9: US than maybe in some other countries, so that sort

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Speaker 9: of stays stays there. I do think though, you know,

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Speaker 9: the question of different ecosystems of if you follow one

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Speaker 9: media outlets and it's peers versus others, of what you're

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Speaker 9: actually onboarding, what you're learning, how issues are framed. That

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Speaker 9: is a real thing in the United States, and it's

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Speaker 9: only going to get more in the spotlight as we

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Speaker 9: head into the twenty twenty four election cycle. In earnest.

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Speaker 1: Yeah, absolutely, just very briefly, Bloomberg has done some exit

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Speaker 1: reporting around the private equity firm behind Dominion, and actually

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Speaker 1: you know how they're involved, and you know the risks

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Speaker 1: and now, of course the I'll call it a reward

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Speaker 1: because it is money, isn't it in terms of damages,

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Speaker 1: But there's an important kind of pe element to this

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Speaker 1: story too.

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Speaker 5: Yes, sure is.

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Speaker 9: I mean, you know, one of the things that Fox

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Speaker 9: was talking about through this whole thing was that the

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Speaker 9: amount of money that Dominion was asking for and you're

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Speaker 9: talking about like one point six billion dollars was far

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Speaker 9: over what it said. Dominion's actual valuation was right, and

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Speaker 9: so the the firm behind I'll try and find the number,

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Speaker 9: but but you're you're talking about Staple Street Capital invested.

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Speaker 9: I believe it was seventy six percent of the company.

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Speaker 9: They paid in twenty eighteen. They paid thirty eight dot

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Speaker 9: three million for I'd seen some estimates that Dominion might

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Speaker 9: have been worth somewhere in the in the range of

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Speaker 9: one hundred million is company. So you're talking about if

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Speaker 9: it's at one hundred million, and again we're in round numbers, right,

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Speaker 9: you know, because because some of these are not you know,

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Speaker 9: publicly traded, you know. But but but even at that,

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Speaker 9: you're talking about more than a seven x valuation, and

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Speaker 9: and Staple Streets getting more than seven x on that

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Speaker 9: just out of this settlement. Now, what Dominion has in

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Speaker 9: terms of being able to go forward, you know, it

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Speaker 9: has contracts with a bunch of a bunch of states

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Speaker 9: and will red states states that sort of gopher had

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Speaker 9: voted for Donald Trump. Will they be wanting to go

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Speaker 9: with Dominion even after this, That's an open question. So

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Speaker 9: in terms of the future revenues, who knows. But I

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Speaker 9: do think in terms of this settlement versus what that

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Speaker 9: investment was originally, there have been a.

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Speaker 2: Lot of.

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Speaker 9: Eyes open. It's certainly compared to that investment just five

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Speaker 9: years ago. This is a settlement on multiple multiples, and

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Speaker 9: that is, you know, from a financial angle, that's certainly intriguing.

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Speaker 1: Yeah, it was certainly unexpected, wasn't it. Derek, Thank you

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Speaker 1: so much for being with us. Boompbig's Derek wallback then

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Speaker 1: talking us through that major settlement. Folks to pay close

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Speaker 1: to eight hundred million dollars to settle a defamation brought

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Speaker 1: by Dominion Voting Systems. Up next, Top Investor details a

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Speaker 1: plan to split HSBC coinbased plot to UK move as

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Speaker 1: the US squeezes crypto and central London house prices take

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Speaker 1: a big hit.

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Speaker 6: Now the paper review on blue Bird Daybreak Europe. The

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Speaker 6: news you need to know from today's.

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Speaker 1: Papers Bloomberkeleyan Goerens joins me this morning. The headline in

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Speaker 1: The Times first Top investor details plan to split HSBC.

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Speaker 1: This is a story that we've covered for a long time,

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Speaker 1: this idea of splitting HSBC, but more details there, Caroline.

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Speaker 2: Is absolutely something that we've been across for a while.

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Speaker 2: And HSBC's largest shareholder is now accusing bosses of being

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Speaker 2: too close minded about the breakup of the bank which

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Speaker 2: they have floated. Yesterday, ping And publicly called for the

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Speaker 2: creation of a separately listed Asia business headquartered in Hong Kong,

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Speaker 2: something they have said before, and that's all according to

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Speaker 2: Bloomberg reporting. But yesterday was a bit different, you know why, Caroline,

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Speaker 2: because they bought out this extremely strong worded statement. It

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Speaker 2: was two thousand words long and it really criticized the

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Speaker 2: British lender. The Chinese insurer actually said it was deeply

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Speaker 2: concerned about HSBC's performance. According to the Time, so Chinese

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Speaker 2: insurer claims that the foot Sea one hundred bank had

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Speaker 2: exaggerated many of the costs and risks surrounding the breakup

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Speaker 2: proposals that has put on the table. Last April, it

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Speaker 2: emerged that ping An wanted HSBC to spin off this

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Speaker 2: huge Asian division to boost a value for shareholders.

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Speaker 3: But according to this letter, the board.

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Speaker 2: Led by Mark Tucker, the chairman and Old Quinn the CEO,

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Speaker 2: hit back publicly arguing that the breakup would be complicated,

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Speaker 2: risky and extremely destructive. What I read into this article

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Speaker 2: we see today in the Times, also very extensively covered

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Speaker 2: here at Bloomberg, is this extremely fractious relationship between Europe's

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Speaker 2: largest bank and one of its most important investors over

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Speaker 2: in Asia.

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Speaker 1: Yeah. Of course, but HSBC making a huge chunk of

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Speaker 1: their profits from Hong Kong, so it's yeah, it's an

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Speaker 1: issue that it's not going to go away. I suspect

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Speaker 1: the Telegraph now crypto champion Coinbase plots UK move as

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Speaker 1: Biden punishes in quotes tech what's this about?

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Speaker 2: Yes, Caroline, So this is also something we've been hearing

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Speaker 2: about for a while now. The multi billion dollar crypto

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Speaker 2: exchange Coinbase is considering a move here to the UK.

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Speaker 3: And this really comes as there is no regulatory clarity

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Speaker 3: on crypto over in the US.

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Speaker 2: This is the argument that's been made America's failure to

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Speaker 2: bring in the regulatory framework for cryptos is massively hitting

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Speaker 2: the industry and could push the likes of Coinbase to relocate.

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Speaker 2: Brian Armstrong he's a CEO of crypto. He made that

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Speaker 2: warning while in conversation with a former chancellor, believe it

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Speaker 2: or not, George Osbourne at the Innovative Finance Global Summer

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Speaker 2: over in the States yesterday, and once again he massively

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Speaker 2: accused America of dragging its feet when it comes to crypto,

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Speaker 2: and that was Brian Armstrong. Armstrong also said the UK

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Speaker 2: has an advantage over the US because the FCA oversees

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Speaker 2: both commodities and securities, where in the US there's a

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Speaker 2: turf battle, as he describes it, between the separate regulators there.

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Speaker 2: And we must also remember something, Caroline, we've been talking

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Speaker 2: about for a while. The BOE is really considering the

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Speaker 2: introduction of the digital pound and also exploring the possibilities

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Speaker 2: of a system of stable coins.

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Speaker 3: Something else. We've been seeing bitcoin, haven't we.

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Speaker 2: Over the last while, It's been hovering north of thirty thousand,

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Speaker 2: So I'm wondering if cryptos been affected by.

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Speaker 3: These regulatory moves.

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Speaker 2: I know coinbas is a stable coin, slightly different, but

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Speaker 2: we have been seeing the likes of ethereum and bitcoin

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Speaker 2: much higher lately.

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Speaker 1: Yeah, no, absolutely, versus the crypto winter last year. Yeah,

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Speaker 1: Financial times just Briefly, Central London house prices suffer biggest

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Speaker 1: annual for since twenty nineteen.

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Speaker 3: Well, Caroline, yes, so we love property, don't we.

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Speaker 2: And central London property prices dropped almost five percent in

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Speaker 2: the twelve months to March and this is the largest

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Speaker 2: annual fall in three and a half years. Now. The

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Speaker 2: FT says this is because wealthy buyers are just not

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Speaker 2: committing to deals of these big properties because of the

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Speaker 2: economic outlook. They're just saying they've got fears, now, they've

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Speaker 2: got jitters, they've got cold feet. And data provided by

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Speaker 2: lnres shows that in prime housing areas in the Capital

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Speaker 2: it drops to its lowest level since mid twenty twenty one. However,

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Speaker 2: you know, the stem is pretty concerning. I'll tell you why,

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Speaker 2: because values in areas like Mayfa and Kensington tend not

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Speaker 2: to suffer that much due to the surge we see

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Speaker 2: in mortgage costs because the market relies on cash rich

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Speaker 2: of foreign buyers.

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Speaker 3: But this is where we are seeing some.

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Speaker 2: Of the softness come into the market, dropping almost five

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Speaker 2: percent in twelve months.

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Speaker 4: This is Bloomberg Daybreak Europe, your morning brief on the

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Speaker 4: stories making news from London to Wall Street and beyond.

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Speaker 1: Look for us on your podcast feed every morning, on Apple, Spotify,

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Speaker 1: and anywhere else you get your podcasts.

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Speaker 4: You can also listen live each morning on London Dab Radio,

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Speaker 4: the Bloomberg Business app, and Bloomberg dot Com.

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Speaker 1: Our flagship New York station is also available on your

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Speaker 1: Amazon Alexa devices. Just say Alexa Play Bloomberg eleven thirty.

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Speaker 1: I'm Caroline Hepka and.

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Speaker 4: I'm Stephen Carroll. Join us again tomorrow morning for all

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Speaker 4: the news you need to start your day right here

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Speaker 4: on Bloomberg day Break Europe.

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Speaker 2: Mm hmm