Speaker 1: Good morning. It's Tuesday, the ninth of January here in London.
Speaker 1: This is the Bloomberg Daybreak you at podcast. I'm Caroline Hepkit.
Speaker 2: And I'm Stephen Carroll coming up today. In another blow
Speaker 2: to Boeing, United finds loose bolts on multiple seven three seven.
Speaker 1: Max jets, as Anthony Blinkn warns of consequences for continued
Speaker 1: attacks in the Red Sea. We have a special report
Speaker 1: on the sailors risking their lives to make the crossing.
Speaker 2: Plus picking up the tab. Taxpayers face a ten billion
Speaker 2: pounds bill for student loans, including those that have already
Speaker 2: been repaid.
Speaker 1: Let's start with a round up of our top stories.
Speaker 2: United Airlines says it has found loose bolts and multiple
Speaker 2: Boeing seven three seven Max jets during inspections of the planes.
Speaker 2: The discovery follows a mid air blowout on an Alaska
Speaker 2: Airlines flight, which prompted the Federal Aviation Administration to ground
Speaker 2: more than one hundred and seventy jets. Bloomberg Intelligence's senior
Speaker 2: aerospace analyst, George Ferguson has more.
Speaker 3: When you look of the way the plug, the sort
Speaker 3: of that the shots later on and you see where
Speaker 3: the plug was, and how clean the plug seemed to
Speaker 3: have left the airplane. It does seem to indicate that
Speaker 3: either fasteners failed or someone didn't apply the fasteners correctly,
Speaker 3: and I think the United News kind of confirms that
Speaker 3: maybe somebody on the manufacturing line didn't understand the right
Speaker 3: procedure for applying this plug.
Speaker 2: Thats George Ferguson from Bloomberg Intelligence. The setback comes after
Speaker 2: a series of manufacturing and quality lapses at Boeing. It
Speaker 2: Shares suffers their biggest decline in more than a year
Speaker 2: on the news, dropping by eight percent.
Speaker 1: In New York, America's top diplomat says that Huthy militants
Speaker 1: will face consequences if they continue to attack ships in
Speaker 1: the Red Sea. Anthony Blincoln's warning comes as the US
Speaker 1: and its allies contemplate strikes on the Iran backed group
Speaker 1: in Yemen. He told reporters that the principle of freedom
Speaker 1: of navigation is at stake.
Speaker 4: We've got forty countries come together to make clear the
Speaker 4: one who these are doing has to stop, and we
Speaker 4: have other countries that have made clear that if it continues, there.
Speaker 5: Have to be consequences.
Speaker 4: So our strong view, our strong preference is that the
Speaker 4: Houthis get the message, but they're receiving from countries around
Speaker 4: the world that this needs to stop, and that's what.
Speaker 5: We're focused on.
Speaker 1: Blinken meets with Israel's leader Benjamin Netanyahu late today. He
Speaker 1: is hoping to contain the conflict in Gaza and potentially
Speaker 1: broker a post war government for the Strip.
Speaker 2: Francis Prime Minister Elizabeth Bonon has resigned, prompting a government
Speaker 2: reshuffle expected to be unveiled today. Bonne said that President
Speaker 2: Emmanuel Macran told her he wanted to replace her. The
Speaker 2: French leaders seeking to refresh his government agenda head of
Speaker 2: European elections in June. French media reporting that Education Minister
Speaker 2: Gabrielle A Dale is the favorite to replace Bonn as
Speaker 2: the next prime minister.
Speaker 1: Samsung's profits have fallen by thirty five percent, amits weak
Speaker 1: consumer demand in the tech industry. Company six straight quarter
Speaker 1: of declining operating profit, which missed estimates by about twenty
Speaker 1: four percent. Tom Kang, who is Research direct at Counterpoint
Speaker 1: Technology Market Research, says that the results indicate that the
Speaker 1: sector's revival might take longer than previously expected.
Speaker 6: The numbers are a bit disappointing, but they are rebounding,
Speaker 6: so I think this shows that the rebound is going
Speaker 6: to be if it's slower than we all thought. So
Speaker 6: the semiconductor market has been starting to recover since the
Speaker 6: third quarter last year. Prices were rising, but it looks
Speaker 6: like the pricing the prices are not rising that fast
Speaker 6: and the demand from certain sectors are not that strong.
Speaker 1: Kang's comments come after Samsung executives predicted in October twenty
Speaker 1: twenty three that the one hundred and sixty billion dollar
Speaker 1: memory market would bounce back gradually this year, driven by
Speaker 1: a boom in AI development. Investors will want to hear
Speaker 1: about Samsung's long term investment plans when it releases full
Speaker 1: results on the thirty first of January.
Speaker 2: Barkley has let go approximately five thousand staff last year.
Speaker 2: The move is the most visible sign yet of cost
Speaker 2: cutting at the lender. Bloomberg's Teawa aut of Bio has
Speaker 2: the details.
Speaker 7: Barkley has cut about six percent of its global headcount
Speaker 7: last year during what was described as its quote ongoing
Speaker 7: efficiency program. According to a company statement, the majority of
Speaker 7: roles affected were in support functions, reflecting increased automation capacity.
Speaker 7: The Bank's stock lagged behind piers in twenty twenty three
Speaker 7: and faces slowing tailwinds from higher interest rates in the
Speaker 7: UK this year. Despite the cuts, Barkley says it will
Speaker 7: continue hiring in some business areas in London. To you
Speaker 7: Are added Bio Bloomberg Radio.
Speaker 1: The UK Treasury is facing a yearly ten billion pound
Speaker 1: hit due to its student loan scheme. It's a cost
Speaker 1: that the Institute for Fiscal Studies says is not on
Speaker 1: the books. Botomberg's James Wilcock explains.
Speaker 8: The think tank says the government will lose an average
Speaker 8: of fifteen thousand pounds per student this year. That's because
Speaker 8: the price of financing new government borrowing is more than
Speaker 8: three times higher what it was two years ago, and
Speaker 8: will outpay students inflation tracking interest, the IFS say the
Speaker 8: spread is not one the Office of National Statistics tracks,
Speaker 8: and is set across the government ten billion pounds annually,
Speaker 8: right at a moment when Chancellor Jeremy Hunt is hoping
Speaker 8: for fiscal headroom in London. James Walcock Blundergradio.
Speaker 2: And UK Christmas shopping sales fail to deliver a festive
Speaker 2: boost for retailers. According to the latest data, the British
Speaker 2: Retel Consort Team and KPMG say that total sales grew
Speaker 2: by just one point seven percent in December, compared to
Speaker 2: almost seven percent growth a year earlier. The difficult trading
Speaker 2: environment for retailers is expected to continue this year as
Speaker 2: sharpers see little respites from higher living costs. Ongoing week
Speaker 2: data may also stoke concerns that the UK economy could
Speaker 2: tip into recession and the possibility of rate cuts by
Speaker 2: the Bank of England. Now, in a moment, we'll bring
Speaker 2: you some first hand reporting from those sailing the world's
Speaker 2: most dangerous shipping lane. Bluebrig's Aaron Clark's going to join
Speaker 2: us for hot piece about the perils for seafarers braving
Speaker 2: the Red Sea and sewers Canal as those attacks by
Speaker 2: Huthy militants have taken place over the past couple of months.
Speaker 2: But on story that cotterrye this morning, Caroline.
Speaker 1: Yeah, do you buy branded sports where gear? I should
Speaker 1: ask should have asked this to Leanne Gerns of great
Speaker 1: who's in the Middle East of longtime listeners keen sports familiar?
Speaker 7: Right?
Speaker 1: Yes? Indeed, I don't know whether you you do. Maybe
Speaker 1: you were influenced if you did by of course that.
Speaker 2: I'm very susceptible to influencing.
Speaker 1: Get Tiger Woods. Twenty seven years, Tiger Woods and Nike
Speaker 1: have had this iconic partnership, partnership worth six hundred and
Speaker 1: sixty million dollars. Now, the golf legend that was announced
Speaker 1: a split, all very friendly, wishing each other well for
Speaker 1: the future and so. But the relationship going back to
Speaker 1: nineteen ninety six, really taking golf to new heights.
Speaker 2: Yeah, hard to imagine how who Tiger Woods was in
Speaker 2: nineteen ninety six, I mean comparatively to the global name
Speaker 2: that he is now.
Speaker 1: Yeah, absolutely, fifteen major titles and obviously still playing. But yes,
Speaker 1: I think this the idea of whether this kind of
Speaker 1: partnership would continue has been in doubt actually for some
Speaker 1: months now, the splits that have come, so there's still
Speaker 1: lots of question marks there about what Tiger Woods might do.
Speaker 1: He does have his own clothing line apparently, not that
Speaker 1: I've ever seen it, but you know, the Nike sworsh
Speaker 1: I think he many revolutionized, you know, sports icons, and.
Speaker 2: I mean he was signed up tonight before Lebron James t.
Speaker 2: I didn't realize I would have sameed that that relationship
Speaker 2: was back much longer anyway. Yeah, fascinating news in the
Speaker 2: words of sports sponsorship as well.
Speaker 1: Now, let's talk about the latest from the Middle East. Now,
Speaker 1: the U S Secretary of State Anthony Blincoln is in
Speaker 1: Israel and meeting with the Prime minist of Benjamin Netanya,
Speaker 1: who this is Israel's longest serving leader, is also facing
Speaker 1: increasing questions about his leadership after the October seventh attack
Speaker 1: and the ensuing war in Gaza. Let's bring in Israel
Speaker 1: Bureau Chief Ethan Bonnet now for more on this topic.
Speaker 1: Good morning, Ethan. First of all, what is Anthony Blincoln
Speaker 1: hoping to achieve on this trip? Now? I believe his
Speaker 1: fourth has the tone shifted.
Speaker 9: I'm not sure how much the toner shifted, but certainly
Speaker 9: Lincoln's goal here has been to urge the Israelis to
Speaker 9: move from a more robust form of warfare to a
Speaker 9: more targeted one, and the Israelis have said that's what
Speaker 9: they're doing at the urging of the United States. So
Speaker 9: partly it's to kind of button that down and make
Speaker 9: sure the Israelis say they're pulling five brigades out in
Speaker 9: the coming days and weeks.
Speaker 5: So that's part of what they want.
Speaker 9: And the goal here is to reduce civilian casualties and
Speaker 9: reduce the risk of starvation and disease spreading and God
Speaker 9: and to start thinking in some concrete terms about the
Speaker 9: so called day after how Gaza is going to be
Speaker 9: run once Israel ends its military efforts to take out Hamas.
Speaker 5: So that's all of that.
Speaker 9: Don't forget that Lincoln arrived in Israel from Saudi Arabia
Speaker 9: and the Emirates, and he comes with a very specific message,
Speaker 9: which is that the Golf leaders are eager and willing
Speaker 9: to help rebuild Gaza, but only in the context of
Speaker 9: the agreement for a Palestinian state. The Israelis are unlikely
Speaker 9: to be willing to say those words at the moment,
Speaker 9: so we'll have to see where it goes.
Speaker 2: What about Benjamin Etniau and all of this as well,
Speaker 2: How has the war with Hamas changed his leadership?
Speaker 5: Well, first of all, it has deeply threatened it.
Speaker 9: I mean, he had sold himself and he'd his entire
Speaker 9: image been as mister Security, a guy who has presided
Speaker 9: over the longest sort of moment of peace and prosperity
Speaker 9: in Israel from around two thousand and six to October seventh,
Speaker 9: a few skirmishes, but fundamentally a great increase in GDP percapit,
Speaker 9: a huge increase in the economy and international investment in Israel,
Speaker 9: and in a sense that the place was safe and secure.
Speaker 9: That's all over, and his poll numbers are way down.
Speaker 5: In addition, of course, you know, he's been.
Speaker 9: Fighting charges of corruption, fraud, bribery.
Speaker 5: So he's got that going.
Speaker 9: But there have been basically and then there was this
Speaker 9: attempt along with his far right partners and government to
Speaker 9: remake the judiciary, weaken the judiciary, which upset people and
Speaker 9: produced weekly demonstrations in the country until October seventh.
Speaker 5: So there was a lot going on to begin with.
Speaker 5: And his numbers are down.
Speaker 9: He is not the most popular leader in Israel right now,
Speaker 9: Benny Gonsay is. But the system is that he doesn't
Speaker 9: have to call an election and he may well not.
Speaker 1: So in terms of the pressure then that he might
Speaker 1: be under. From Anthony Blinkin, how much is Netnyahu's fate
Speaker 1: tied with what happens in Gaza? I mean, might he
Speaker 1: be forced out before the end of the war. I
Speaker 1: mean these Raelis are talking about many, many months of
Speaker 1: war and conflict.
Speaker 5: They are.
Speaker 9: The problem is what does it mean to force them out?
Speaker 9: There is no real legal system to force them out.
Speaker 9: He has a sixty four member a Kinesset majority out
Speaker 9: of one hundred and twenty, and as long as he
Speaker 9: holds his coalition together, there is no way to drive
Speaker 9: him from power unless he were to be convicted, and
Speaker 9: that's not going.
Speaker 5: To happen quickly enough for that to happen.
Speaker 9: So the idea would be that there's this emergency cabinet
Speaker 9: war cabinet, which includes members of the opposition.
Speaker 5: If this war shifts into a more.
Speaker 9: Low level operation and they decide there's no longer a
Speaker 9: need for an emergency cabinet, then we're back to the
Speaker 9: old government and you know, they'll probably be weekly demonstrations
Speaker 9: again calling for him to resign, and people are very
Speaker 9: angry and eager for the remaining hundred plus hostages to
Speaker 9: be returned. But you know, there is no specific way
Speaker 9: of making him leave, and what we know about him
Speaker 9: suggests he's unlikely to go on his own.
Speaker 2: Okay, well, a story for us to honoror then Israel
Speaker 2: Buia Chief Ethan Browner, thank you very much for joining us.
Speaker 5: With that.
Speaker 1: We've been reporting in recent weeks though on the attacks
Speaker 1: on cargo ships traveling through the Red Sea. The strikes
Speaker 1: by militant group in Yemen have endangered civilian seafares, raise
Speaker 1: costs along a crucial global trade artery, and of course
Speaker 1: it's related to the war in Gaza, to attentions in
Speaker 1: the Middle East. Bloomberg's Aaron Clark has been speaking though
Speaker 1: to some of those aboard these ships, and he joins
Speaker 1: us now for more Alan, good morning, Thank you for
Speaker 1: being with us. Just remind us why are Iran backed
Speaker 1: Houthi militants based in Yemen attacking commercial vessels in the
Speaker 1: Red Sea.
Speaker 10: Yeah, the Huthi militants and you men, they're attacking ships
Speaker 10: connected to Israel, or they've said they're attacking ships connected
Speaker 10: to Israel in order to break the siege on Gaza
Speaker 10: and stop Israeli aggression. You know, they're they're demanding people
Speaker 10: in Gaza get access to things like food and medicine.
Speaker 10: Some of the initial attacks were on vessels that appeared
Speaker 10: to have a link to you know, Israel or Israeli ownership.
Speaker 10: Those connections have begun to look a lot more tenuous
Speaker 10: now and just in terms of the numbers. You know,
Speaker 10: the US Central Command have said that there have been
Speaker 10: twenty four at least twenty four attacks between November nineteenth
Speaker 10: and January two. And there's still, you know, a vessel
Speaker 10: that was hijacked and remains off the coast of you men,
Speaker 10: there's a twenty five member crew that's that's effectively hostage
Speaker 10: right now.
Speaker 2: And you spoke to sephars whose ships have been attacked
Speaker 2: by by drones? Can you describe what they experienced?
Speaker 10: Yeah, I mean, you know, it's it's pretty traumatic. One
Speaker 10: seafair I spoke with he described how, you know, he
Speaker 10: was on the bridge helping navigate the ship through the
Speaker 10: Red Sea. It was around midday, most of the most
Speaker 10: of the crew was was having launch in the dining
Speaker 10: hall and basically, you know, there there was a loud
Speaker 10: bang and it was very clear that that there had
Speaker 10: been some sort of an attack. It didn't actually directly
Speaker 10: strike the ship. They believe it was a drone. He
Speaker 10: said it was very windy that day and he thinks
Speaker 10: the wind actually probably saved the ship from a direct strike,
Speaker 10: which obviously could have been catastrophic. But anyway, there was
Speaker 10: a huge bang. The captain quickly ran up from the
Speaker 10: dining room and got on the public address system and
Speaker 10: ordered most of the crew into the ship's citadel. This
Speaker 10: is basically a safe room where you can sort of
Speaker 10: barricade in the event the ship is being attacked by
Speaker 10: by pirates. But the people were maining on the bridge
Speaker 10: sent out distress messages. Very quickly. A US warship arrived
Speaker 10: and and sort of checked them for damage, and they
Speaker 10: continued through the strait and were able to make it
Speaker 10: out safely. But you know, clearly it can be traumatic,
Speaker 10: and you know the seafair I spoke to him and
Speaker 10: he said that some some other seafares broke down in
Speaker 10: tears because it was you know, they could have they
Speaker 10: could have they could have died. So it's it's it's
Speaker 10: can be quite traumatic and dangerous for these folks who
Speaker 10: are civilian seafarers.
Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the
Speaker 2: stories making news from London to Wall Streets and beyond.
Speaker 1: Look for us on your podcast feed every morning on Apple,
Speaker 1: Spotify and anywhere else you get your podcasts.
Speaker 2: You can also listen live each morning on London Dab Radio.
Speaker 2: The Bloomberg Business app and Bloomberg dot Com.
Speaker 1: Our flagship New York station is also available on your
Speaker 1: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.
Speaker 1: I'm Caroline Hetka.
Speaker 2: And I'm Stephen Carroll. Join us again tomorrow morning for
Speaker 2: all the news you need to start your day right
Speaker 2: here on Bloomberg day Break Europe