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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Bloomberg Daybreak Asia podcast. I'm Brian Curtis

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Speaker 2: along with Doug Krisner. Join us each day for the

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Speaker 2: stories making news and moving markets in the Asia Pacific.

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Speaker 2: You can subscribe to the show anywhere you get your

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Speaker 2: podcasts and always on Bloomberg Radio, the Bloomberg Terminal, and

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Speaker 2: the Bloomberg Business app.

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Speaker 3: Earlier today, shareholders in Tesla voted in favor of CEO

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Speaker 3: Elon Musk's compensation package. They also voted to move the

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Speaker 3: company's state of incorporation to Texas from Delaware. However, the

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Speaker 3: pay vote is only advisory, and it doesn't guarantee Musk

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Speaker 3: will get his package worth right now mark to market

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Speaker 3: at around a forty eight point four billion dollars you know.

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Speaker 3: Back in January, a judge in Delaware nullified that compensation plan.

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Speaker 3: Tesla to be fair is expected to appeal, and if

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Speaker 3: the appeal fails, moving Tesla's legal home to Texas, that

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Speaker 3: would allow the board to revive the pay package in

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Speaker 3: a new state, potentially with more favorable courts. Brian Well.

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Speaker 2: Joining us is Dana Hall, Bloomberg News Senior Technology Report.

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Speaker 2: Her to shed some further light on this. So we

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Speaker 2: don't know the actual margin of the wind, but we

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Speaker 2: didn't have that post on X from Elon Musk saying

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Speaker 2: that they were passing by a wide margin. What have

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Speaker 2: we heard from investors on both sides?

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Speaker 1: Yeah, so, you know, the voting has been going on

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Speaker 1: for quite a while and you saw Tesla do a

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Speaker 1: very big outreach campaign to retail investors and the big

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Speaker 1: wild card was how are the large shareholders going to vote.

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Speaker 1: We still don't know the margin of victory, but it

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Speaker 1: was obviously pretty big. I mean, Elon Musk was very

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Speaker 1: happy at the shareholder meeting today. When he came on

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Speaker 1: to stage, he did like a little dance and he said,

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Speaker 1: I you know hot, damn, I love you guys, or

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Speaker 1: something like that, and you know, he was in a

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Speaker 1: very expansive mood. I haven't heard much reaction from shareholders

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Speaker 1: so far today. I mean, obviously so some of the

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Speaker 1: larger funds, like the Norwegian Sovereign Wealth Fund and Helpers.

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Speaker 1: You know, they'd put out statements ahead of the vote

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Speaker 1: saying that they were planning to vote against the pay package.

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Speaker 1: But you know, the people that were for it were

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Speaker 1: for it. And this is you know, this is a

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Speaker 1: good outcome from us, and it's a strong outcome for

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Speaker 1: Tesla as they still kind of wrestle with the Delaware decision.

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Speaker 3: So Dan, as I understand it, Back in twenty eighteen,

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Speaker 3: he worked out a deal with a board making him

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Speaker 3: eligible for these stock options if he was able to

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Speaker 3: get Tesla to hit certain milestones. He was successful in that,

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Speaker 3: but in January, a judge in Delaware nullified the plan.

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Speaker 3: What was the basis for that ruling? Can you remind us?

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Speaker 1: Yeah? I mean, so a shareholder sued Musk. The case

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Speaker 1: is called Tornetta versus Musk, and argued that the board

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Speaker 1: was rife with conflicts of interest and that you know,

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Speaker 1: it wasn't really a fair negotiation. I mean that Musk

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Speaker 1: was basically pressuring the board to give him this package,

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Speaker 1: and then there was just a lot of problems with

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Speaker 1: the way that the package was disclosed. And so the

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Speaker 1: judge kind of came out with this two hundred page

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Speaker 1: ruling that really shocked everybody back in January and really

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Speaker 1: infuriated Musk. He immediately talked about, you know, it's time

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Speaker 1: to leave Delaware as our corporate home. And so this

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Speaker 1: shareholder meeting was like a reaction to that, like, we're

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Speaker 1: going to revote on the pay package and move to Texas.

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Speaker 1: And you know, I think that Tesla's hope is that

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Speaker 1: by re ratifying the same pay package from twenty eighteen,

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Speaker 1: that they are answering a lot of the concerns that

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Speaker 1: the judge had. They're saying, look, investors are still for

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Speaker 1: this plan. They fully know what they're getting into. We

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Speaker 1: have a lot more disclosures. Our proxy statement even links

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Speaker 1: to your two hundred page opinion. So it's their effort

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Speaker 1: to kind of answer her concerns.

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Speaker 2: This really is a very interesting stretch from twenty eighteen

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Speaker 2: ton Now. I mean, if you ask a lot of

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Speaker 2: people the narrative on Tesla's stock as well, it's down

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Speaker 2: more than fifty percent. You know, it is up over

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Speaker 2: four hundred dollars at one point. Now it's at one

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Speaker 2: eighty two. But they forget that back in twenty eighteen,

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Speaker 2: when he signed on to this package and it was

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Speaker 2: approved by seventy three percent of the vote, the stock

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Speaker 2: was on a split adjusted basis around twenty four dollars,

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Speaker 2: and now at one eighty two, that's a massive that's

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Speaker 2: a massive move. So this is really kind of like

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Speaker 2: pure capitalism at work, right, Oh yeah.

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Speaker 1: One hundred percent. I mean, you know, you can look

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Speaker 1: at the pay package and say, Elon Musk did what

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Speaker 1: the comp plan kind of asked to do. He met

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Speaker 1: these crazy, big, very ambitious, very aggressive targets. He deserves

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Speaker 1: to be paid and you know, not only did he

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Speaker 1: enrich himself, but he enriched lesions of shareholders, both big

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Speaker 1: and small, and that it's crazy enough to reward him

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Speaker 1: for doing that. On the flip side, the intention of

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Speaker 1: the twenty eighteen pay package was to incentivize Musk to

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Speaker 1: stay focused on Tesla, and even though he did meet

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Speaker 1: all the milestones, he then sold his Tesla shares to

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Speaker 1: buy Twitter, which he renamed X and he has started

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Speaker 1: yet another X, yet another company known as X dot Ai.

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Speaker 1: So he's still very interested in many, many, many other things.

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Speaker 1: And so what I'm most curious about is, you know,

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Speaker 1: beyond the legal wrangling around the current paid package, like,

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Speaker 1: at what point does the Tesla board come back and

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Speaker 1: like potentially incentivize him again, Like is he going to

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Speaker 1: get a new pay package going forward?

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Speaker 3: Let's talk about the approval of Musk's move, moving the

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Speaker 3: headquarters from Texas or to Texas, I should say, from Delaware.

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Speaker 3: Is this all about the strategy to try to get

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Speaker 3: the pay package the ruling on the pay package overturned.

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Speaker 3: Where is there something that we have to understand about

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Speaker 3: his thinking and the way he views doing business in

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Speaker 3: Delaware versus Texas.

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Speaker 1: Yeah, I mean, so Tesla's corporate headquarters is already in Texas.

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Speaker 1: That move happened in late twenty twenty one, and you know,

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Speaker 1: Musk lives in Texas. A lot of executives are now

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Speaker 1: based there. They have a big workforce there. And I

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Speaker 1: think that, you know, Musk's frustration with Delaware Chancery Court,

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Speaker 1: which kind of came to a head over you know,

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Speaker 1: not just the long trial over his compensation plan, but

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Speaker 1: also a trial over Tesla's acquisition of Solar City. Like

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Speaker 1: he just is done. He would rather be in Texas,

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Speaker 1: which I think has you know, a very much newer

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Speaker 1: you know, I mean, corporate law is not as well

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Speaker 1: established in Texas. But I think that you know, he's

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Speaker 1: Musk is just ready to kind of have everything be

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Speaker 1: in the same state. And yeah, going forward, any litigation

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Speaker 1: that he would face would not be subject to Delaware

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Speaker 1: Chancery court. That's why in the past like twenty four hours,

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Speaker 1: you've seen a lot of lawsuits filed in Delaware court

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Speaker 1: because Tesla could announce that they've successfully, you know, have

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Speaker 1: moved their legal jurisdiction to Texas like any day now.

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Speaker 1: I mean, it could be, it could happen very fast

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Speaker 1: once there's a legal filing.

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Speaker 2: Danna, we had to pop in the stock today. But

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Speaker 2: I'm curious about those who wanted to vote against this

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Speaker 2: and big, huge pension funds like Calsters and CalPERS. Is

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Speaker 2: there any thinking or were there any threats from them

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Speaker 2: that they might you know, divest to a certain degree.

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Speaker 1: No, I mean that is certainly one avenue. I mean

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Speaker 1: you have to sort of ask yourself if you're that

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Speaker 1: unhappy with the company, like why are you still an investor?

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Speaker 1: But I think that some investors, you know, would feel

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Speaker 1: like shareholder activism is the way to go, and they

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Speaker 1: try to try to engage with the company internally. And obviously,

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Speaker 1: you know, Musk and board chair Robin Denholm had a

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Speaker 1: lot of meetings with big institutional investors over the past

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Speaker 1: couple of weeks. I have not heard anything from any

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Speaker 1: of the funds that said that they were no on

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Speaker 1: pay about divestment.

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Speaker 3: Could there be more lawsuits? Do you think?

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Speaker 2: Oh?

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Speaker 1: Absolutely?

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Speaker 2: Yeah?

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Speaker 4: Always.

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Speaker 1: I mean someone could too to stop the moved Texas

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Speaker 1: once they're in Texas. Like, I mean, yeah, there there

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Speaker 1: there there's always a lot of litigation around things like this.

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Speaker 2: I'm kind of curious about this too. I know it's

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Speaker 2: counterfactual or speculation whatever, but what might Elon Musk have

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Speaker 2: done if he lost this vote?

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Speaker 1: I think he would have been upset. It would have

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Speaker 1: been kind of like a stinging rebuke of both the

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Speaker 1: legal strategy and of his tenure as the CEO. But

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Speaker 1: you know, I mean he would have he would have

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Speaker 1: probably continue. I mean, I don't think it would have changed,

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Speaker 1: you know, it would have wouldn't have changed, you know,

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Speaker 1: I don't know if he would have. I don't think

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Speaker 1: he would have quit necessarily. I mean, he still owns

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Speaker 1: thirteen percent of the company.

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Speaker 3: Very quickly, last question, this new stock exchange that may

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Speaker 3: be established in Dallas. Do you think he will list

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Speaker 3: Tesla and some of his other companies on that change?

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Speaker 1: Yeah, that I do not know. I mean I would

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Speaker 1: imagine that the exchange would have to get up and

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Speaker 1: running for a bit.

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Speaker 3: First, All right, we'll leave it there.

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Speaker 2: Ran I was just going to say, Don, was the

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Speaker 2: workout coming on this program? Get questions from all over

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Speaker 2: the place, but good questions and good answers. Donna, thank

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Speaker 2: you very much. Dana Holt Bloomberg need Who's senior technology

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Speaker 2: report him. We wanted to take a closer look at markets,

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Speaker 2: and we're joined by Villain Sells, a global CIO at

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Speaker 2: HSBC Global Private Banking and Wealth with us here in

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Speaker 2: our studios in Hong Kong. Villain, thanks very much for

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Speaker 2: coming in. So we are starting to kind of get

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Speaker 2: into the area again about worrying about growth scares. We

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Speaker 2: had jobless claims have another bounce in the US and

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Speaker 2: we've seen a little bit of a softening of the data.

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Speaker 2: Is it rational to be worried about growth or should

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Speaker 2: we just include it in let's say, a group of

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Speaker 2: scenarios that are possible and that should be discounted.

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Speaker 5: Well in our discussion with our clients. It's remarkable that

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Speaker 5: you know, in the past six months there is a

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Speaker 5: complete swing. You know, we were talking about we're asking

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Speaker 5: about the risk of a recession six twelve months ago.

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Speaker 5: This is no longer the case. And I agree with them,

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Speaker 5: and I agree with Yellen on this as well. You know,

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Speaker 5: data are slowing a little bit, but from a very

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Speaker 5: strong position, you know, So that basically means that, you know,

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Speaker 5: it gives the FED the opportunity to to to cut

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Speaker 5: in September. Interview. So I think this is actually a

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Speaker 5: good thing that we are coming from that very strong

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Speaker 5: to a milder economic growth, and in the rest of

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Speaker 5: the world we're actually seeing a slight acceleration. So we're

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Speaker 5: broadening out our exposure, adding Europe and Asia to the US,

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Speaker 5: but continuing also to be comfortable with the US stop.

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Speaker 3: So vellamy, You do believe that US rates then are

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Speaker 3: restrictive right now, and it would be a prudent thing

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Speaker 3: for the Fed to begin cutting a SAP, I would imagine, right.

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Speaker 3: So yeah, so.

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Speaker 5: Indeed cutting in September. Even if they cut in September,

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Speaker 5: obviously those raids will remain restricted. The real rate is

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Speaker 5: at a very elevated level, and it has been on

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Speaker 5: that plateau for quite a long time. You know, they

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Speaker 5: have excluded more or less rate hikes. The dots did

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Speaker 5: not include anybody who was looking for a rate hikes,

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Speaker 5: So that's a good signal, and obviously that also allows

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Speaker 5: people to go into bonds. So one of the biggest

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Speaker 5: flows that we are seeing is people locking in those

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Speaker 5: bond yields with that you know, comforting message from the Fed.

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Speaker 2: Do you see it as a possibility though, that if

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Speaker 2: growth does slow, maybe not all the way to recession,

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Speaker 2: but if it does slow measurably, that that could actually

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Speaker 2: lead to a further big balance in the megacaps.

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Speaker 5: So to the extent that indeed those are growth style stocks,

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Speaker 5: you know, which are interest rate sensitive, Indeed, that could

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Speaker 5: you know, help the growth style companies. You know, Our

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Speaker 5: strategy for the moment is actually to broaden it out,

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Speaker 5: not to give up on the MACT seven because their

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Speaker 5: earnings growth is solid. But when you look at earnings

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Speaker 5: momentum over the next number of quarters, where the acceleration

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Speaker 5: is in earnings growth is in other sectors those obviously

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Speaker 5: are cheaper as well. So we broaden out our exposure

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Speaker 5: in the equity market built from a geographical perspective, but

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Speaker 5: also within the US across other sectors, so for example,

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Speaker 5: industrials and financials.

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Speaker 3: I'm wondering as I'm listening to you, thinking about maybe

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Speaker 3: slower growth in the US. We know that growth in

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Speaker 3: Europe has been weak for some time. The ECB is

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Speaker 3: now leaning into that by delivering a bit of accommodation. Laguard, yes,

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Speaker 3: putting some caveats in as she cuts interest rates, you know,

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Speaker 3: data dependency. We get that. But I'm wondering whether or

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Speaker 3: not growth in Europe may pick up at a rate

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Speaker 3: that at some point could rival, at least rival what

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Speaker 3: we're seeing in the US is that misguided.

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Speaker 5: It's picking up. We are coming out of free session,

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Speaker 5: we have come out of recession, and so that is,

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Speaker 5: you know, giving that momentum, and that I think the

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Speaker 5: opportunity or the excuse if you want to call it

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Speaker 5: that for people to you know, start to think about,

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Speaker 5: you know that that very big valuation differential between the

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Speaker 5: US and Europe, and that you know, can be unlocked

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Speaker 5: by that cyclical momentum. Indeed, when you look at the

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Speaker 5: growth forecast. But that's more sort of for twenty twenty five,

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Speaker 5: the growth rates you know, for Europe, the UK and

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Speaker 5: the US shouldn't be too far apart, where whereas obviously

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Speaker 5: for twenty twenty four, the US is much much superior.

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Speaker 5: But indeed you could have that narrowing of that gap.

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Speaker 2: So I'm personally of the view that we are going

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Speaker 2: to get a little bit of a growth scare here.

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Speaker 2: People are going to be concerned about it, whether or

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Speaker 2: not least a recession. That's way down the road. But

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Speaker 2: then I know, in your overways the US and Japan,

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Speaker 2: I think everybody can understand that. But emerging market Asia, now,

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Speaker 2: if you get a US slowdown, what appens to emerging

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Speaker 2: market Asia?

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Speaker 5: Well, emerging Marketsia for US, you know, there are well

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Speaker 5: within each that there are three countries that were overweted

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Speaker 5: to Japan. It's India and South Korea. So, you know, India,

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Speaker 5: we do think, you know that people shouldn't exaggerate, you know,

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Speaker 5: the election news. I do think that you can get

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Speaker 5: continued you know, reforms, especially on the subject of you know,

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Speaker 5: technology and advanced manufacturing. Obviously there is you know, very

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Speaker 5: you know, positive longer term growth look out look in

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Speaker 5: India as well, So I think that market will rebound

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Speaker 5: and so we want to be there. South Korea is

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Speaker 5: more because of the semiconductor you know, pick up as well.

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Speaker 5: So we are selective within the region, but we're actively

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Speaker 5: diversifying as we are still neutral on mainland China and

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Speaker 5: Hong Kong, because we don't think that the rally that

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Speaker 5: you've seen a number of weeks ago will extend as

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Speaker 5: long as you don't have an acceleration in economic growth

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Speaker 5: or in earnings. So we're doing that active diversification, being selective.

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Speaker 5: But yeah, because of India and South Korea and then Japan,

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Speaker 5: we have the overweight here as well.

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Speaker 3: What would it take for you to change your mind

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Speaker 3: on China? And are you prepared to do that in

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Speaker 3: the event that the government comes to some type of

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Speaker 3: realization that more stimulus is required. Are you able to

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Speaker 3: pivot quickly and maybe to rethink your view on China?

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Speaker 5: Sure, I mean we reconsider it every month at least

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Speaker 5: in our in our investment committees. But what we really

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Speaker 5: need is that, you know, the earnings acceleration and the

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Speaker 5: GDP acceleration. You know, certainly foreigners would be looking for

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Speaker 5: that won't have necessarily, you know, won't won't necessarily be

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Speaker 5: scared of missing the first five or ten percent of

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Speaker 5: the rally. They want to wait and see, to see

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Speaker 5: the evidence in the hard data, you know, So that's

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Speaker 5: what they're waiting for. The Q one earnings results from

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Speaker 5: from China. We're somewhat disappointing, I think, you know here

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Speaker 5: in China as well, the property package was probably a

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Speaker 5: little bit lower than what in my that was expecting. So,

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Speaker 5: you know, people not you know, jumping to conclusions or

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Speaker 5: you know, giving the market the benefit of the data.

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Speaker 5: They want to see the numbers. But then indeed there

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Speaker 5: are there would be in fills once you see them,

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Speaker 5: because obviously that market is extremely cheap, people are extremely underweight,

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Speaker 5: you know, so then indeed we would need to act.

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Speaker 2: So we've seen obviously a lot of growth in AI

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Speaker 2: related stock buying in the United States in particular, So

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Speaker 2: I think that's one of the most important trends running

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Speaker 2: through the market. People very concerned about, you know, when

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Speaker 2: does it break, when does it slow down? What do

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Speaker 2: you look at to learn that? I mean, what's the

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Speaker 2: key for that?

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Speaker 5: Yeah, So so what we think is, you know, so

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Speaker 5: again this is one of the objectives of broadening, right,

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Speaker 5: and so that people are not only just investing in

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Speaker 5: the max seven and in their trade, you know, because

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Speaker 5: even though we are positive on that and you know,

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Speaker 5: the IMF things that we're going to have up to

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Speaker 5: zero points eight percent boost to global GDP and the

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Speaker 5: medium term because of that, which is very considerable. You know,

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Speaker 5: it's just wise to spread out, you know, especially as

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Speaker 5: that as that valuation differential gives the opportunities elsewhere. But

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Speaker 5: there are related trains that one can do. Even utilities,

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Speaker 5: for example, have been boosted by that energy demount, that would.

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Speaker 2: Be absolutely Yeah, it's really quite an interesting phenomenon that

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Speaker 2: we've seen that. All right, Villain, thanks very much for

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Speaker 2: joining us and for coming into our studios with this.

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Speaker 2: Always a pleasure of Villain Cells, Global CIO at HSBC

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Speaker 2: Global Private Banking and Wealth. The Bank of Japan is

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Speaker 2: holding a two day meeting. It will wrap up that

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Speaker 2: meeting later this morning. Joining us now for some discussion

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Speaker 2: is Tarro Kimura, senior Japan Economists for Bloomberg Economics. Tarrow,

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Speaker 2: thank you for joining us. Bloomberg Economics is saying this

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Speaker 2: will be a consequential meeting. Might we see a reduction

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Speaker 2: in bond buying? Right?

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Speaker 4: I think it's really likely that the BOG will announce

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Speaker 4: the cutting its JGB purchases, which is kind of a

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Speaker 4: very momentous pivot from its unconventional Manetali policy, particularly after

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Speaker 4: it's introduced its introduced quantitative qualitative easing back in tow

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Speaker 4: seas and thirteen. That said, I don't think the announcement

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Speaker 4: won't spook the bond market because I expect the BOJ

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Speaker 4: to announce very graudial and modest reduction to JGB hills

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Speaker 4: based on the governor with us a previous comment that

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Speaker 4: he doesn't want to use bond buyings as active policy too.

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Speaker 4: So basically I think he doesn't want to spook the

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Speaker 4: market by QTS. But it's another big step for the

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Speaker 4: buj's normalization to its policy.

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Speaker 3: You no doubt about that. And I'm looking on the

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Speaker 3: Bloomberg terminal. I guess the yield right now and the

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Speaker 3: tenure JGB is just around ninety five basis points. I

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Speaker 3: would imagine that the banks in Japan are celebrating this

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Speaker 3: type of action, that the BOJ is finally moving to

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Speaker 3: widen the spread a little bit between the policy rate

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Speaker 3: and you know, let's say a ten year yield, right right.

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Speaker 4: Absolutely, So one of the backdrop, I expect the BOJ

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Speaker 4: will to the cut in JGB pursas as soon as

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Speaker 4: this meeting is. Basically, the Marcus doesn't want the BOJA

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Speaker 4: intervene to the long areas anymore. So, absolutely it will

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Speaker 4: welcome and the banks and financial institutions wants higher JGB

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Speaker 4: els that push back the bojs r QT process make

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Speaker 4: it comfortable for the central back.

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Speaker 2: I know it from a few comments. There are some

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Speaker 2: fears that the BOJ still drags its feet a little

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Speaker 2: and doesn't make a move on either interest rates or

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Speaker 2: on the bond buying, and I'm wondering if they If

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Speaker 2: that's the case, if that's what happens, could the end

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Speaker 2: reach the one sixty level to the week side.

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Speaker 4: I think so if the BOJ, which isn't my baseline,

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Speaker 4: and I don't think it will happen, but if the

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Speaker 4: BOJ hold policy on both on rates and JGB purchases,

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Speaker 4: it's gonna like you know, I think it's a it's

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Speaker 4: a good opportunity for yen bears to cease on the

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Speaker 4: opportunity to add more selling pressure to the end and

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Speaker 4: probably it will break one sixty again. That said, I

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Speaker 4: think the view from that the Bank of Japan may

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Speaker 4: hold of is coming from the fact that the Japan's

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Speaker 4: Japan's economy isn't that strong under the state of school.

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Speaker 4: But my view is the BOJ is moving forward looking

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Speaker 4: with this forward looking assessment that the higher waste growth

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Speaker 4: agreed by annual spring wage negotiation will feed into stronger

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Speaker 4: service prices. So that's why I think it's July hike

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Speaker 4: and today's QT announcement is already in the pipeline.

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Speaker 3: So what do we need to know? What do we

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Speaker 3: need to understand about the inflation story in Japan? You

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Speaker 3: were talking a moment ago about a weekend and that

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Speaker 3: tends to import inflationary pressures into an economy. You mentioned

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Speaker 3: the wage negotiations too, so we're seeing finally after seeming

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Speaker 3: decades long stagnation in wages, I mean, things are starting

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Speaker 3: to pick up. What do we know about underlying inflation

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Speaker 3: in Japan at the moment?

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Speaker 4: So the big waste negotiation will absolutely fit into higher

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Speaker 4: waste growth and higher service prices, which we haven't seen

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Speaker 4: seen it in macro data because which the agreement was

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Speaker 4: just made, and I think it's going to be fit

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Speaker 4: into a May and June data that will be due

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Speaker 4: from July or August whatsoever. But it's we can expect

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Speaker 4: that to happen. And also I would say the higher

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Speaker 4: energy prices not because of the kind of demand or whatsoever.

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Speaker 4: But because of the subsidy cut, will the course CPI

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Speaker 4: going on this year and the CPI will comfortably over

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Speaker 4: over boja's two percent target. That will give leeway for

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Speaker 4: the Bank of Japan to do policy normalize the instation,

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Speaker 4: including hiking rates and QT.

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Speaker 2: Yeah, you draw some attention to normalization and the fact

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Speaker 2: that you know, sometimes the market wants normalization, sometimes it

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Speaker 2: wants the right policy for what's happening in the economy.

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Speaker 2: So for instance, if the BOJ normalizes and raises interest

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Speaker 2: rates into an economy that is troubled, is not really growing,

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Speaker 2: then the market could react badly. But it seems like

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Speaker 2: what you're saying is the moves are there, or the

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Speaker 2: conditions are there for things to improve going forward, and

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Speaker 2: the BOJA probably will act, just not in a huge way.

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Speaker 4: Right, So my expectation is BOJA will raise race up

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Speaker 4: to zero point five by October, So it's going to

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Speaker 4: be forty basis points from current Zerer point? Why one

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Speaker 4: a policy target upper bound? I don't think zero point

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Speaker 4: four like forty basis point great hike won't wreck k havok

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Speaker 4: to Japan's economy because it's it's it's an aging economy,

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Speaker 4: so the size of the housing construction or housing purchases

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Speaker 4: is just three percent in the whole economy. And also

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Speaker 4: the balance sheet of Japanese corporates are getting healthy, so

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Speaker 4: the limited amount increase in rates increase won't rekabook on

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Speaker 4: their profits as well.

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Speaker 2: Thank you so much for joining us, Tara Kimura, Senior

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Speaker 2: Japan Economists at Bloomberg Economics.

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Speaker 3: This has been the Bloomberg Daybreak Asia podcast, bringing you

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Speaker 3: the stories making news and moving markets in the Asia Pacific.

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