WEBVTT - China-US Tensions And A Fee For Your Facebook Feed

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<v Speaker 1>This is Bloomberg Daybreak here for this Monday, the twenty

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<v Speaker 1>February in London. Coming up today, seeking competition over conflict,

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<v Speaker 1>the US and China struggle to achieve a meeting of

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<v Speaker 1>minds the end of the beginning soonac looks to reset

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<v Speaker 1>EU relations with a Brexit deal on Northern Ireland, a

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<v Speaker 1>fee for your feed. Meta launches a subscription service across

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<v Speaker 1>Facebook and Instagram. Questions over Ireland's economic growth, Elon fails

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<v Speaker 1>to pick up the bill for Twitter and UK retail

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<v Speaker 1>in need of therapy. Those are the stories we're looking

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<v Speaker 1>at in today's papers and nine Leanne Gern's plus asking

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<v Speaker 1>prices head north in North London Camden rises by more

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<v Speaker 1>than seventeen That's all straight ahead on Bloomberg Daybreak Europe.

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<v Speaker 1>The business news you need to start your day in

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<v Speaker 1>just one fifteen minute podcast on Apple, Spotify, the Bloomberg

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<v Speaker 1>Business App and everywhere you get your podcasts. Good morning,

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<v Speaker 1>I'm Stephen Carroll and I'm Caroline Hecker. Here are the

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<v Speaker 1>stories that we're following today. The top diplomats from China

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<v Speaker 1>and the United States have traded barbs in a sign

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<v Speaker 1>of worsening ties in their first in person meeting since

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<v Speaker 1>the Chinese balloon was shot down above the United States,

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<v Speaker 1>Secretary of State Anthony B. Lincoln was blunt. I made

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<v Speaker 1>very clear to him that China sending a surveillance balloon

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<v Speaker 1>over the United States in violation of our sovereignty, in

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<v Speaker 1>violation of international law, was unacceptable and must never happen again.

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<v Speaker 1>Lincoln there on CBS's face the nation. Shortly after, he

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<v Speaker 1>met with China's Foreign Minister Wang Yi, who called the

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<v Speaker 1>balloon incident quote hysterical, just as I would say absurd

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<v Speaker 1>and hysterical. This is a abuse of the use of force. Wang.

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<v Speaker 1>He refused to even cool his conversation with Anthony B.

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<v Speaker 1>Lincoln an official meeting, arguing that the two and he

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<v Speaker 1>spoke because the US made a request. The sorrowing mood

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<v Speaker 1>goes beyond Rhustwick, though, as America is concerned, China is

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<v Speaker 1>weighing whether to give Russia weapons for the war in Ukraine.

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<v Speaker 1>The growing sense of unease between the two superpowers comes

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<v Speaker 1>as Goldman stratagists say Chinese stocks of the potential to

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<v Speaker 1>rise by twenty four percent this year. Bloomberg's Bryan Carters

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<v Speaker 1>has more from Hong Kong Goldman thinks the recent sell

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<v Speaker 1>off of Chinese stocks will reverse and that MSCI China

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<v Speaker 1>can at eight five by the end of the year.

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<v Speaker 1>That's up from around seventy. Now what's interesting about this

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<v Speaker 1>call is that the strategists say that the rise will

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<v Speaker 1>be led by earnings and not just multiple expansion. Some

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<v Speaker 1>investors might quibble with this given the rise in geopolitical

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<v Speaker 1>tensions of late and the property crisis, but the banks

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<v Speaker 1>us a shift from reopening to recovery that will deliver

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<v Speaker 1>windfall profits for business in Hong Kong. Brian Curtis, Bloomberg

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<v Speaker 1>Daybreak hero Now, Bloomberg understands that the Prime Minister Ishisunak

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<v Speaker 1>is preparing to unveil a d deal with the European

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<v Speaker 1>Union on Northern Ireland. If an agreement can be reached,

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<v Speaker 1>it could help to reset relations between the UK and

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<v Speaker 1>EU three years after Brexit. Speaking to Bloomberg's Maria Today

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<v Speaker 1>are at the Munich Security Conference, Sooner cautioned that nothing

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<v Speaker 1>has been finalized. There is still work to do, there

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<v Speaker 1>are still challenges to work through. We have not resolved

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<v Speaker 1>all these issues. No, there is no there isn't a

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<v Speaker 1>deal that has been done that there is an understanding

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<v Speaker 1>of what needs to be done. I've been in Northern

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<v Speaker 1>Ireland talking to parties there about the things that we

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<v Speaker 1>need to fix. We're working through those. We're working through

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<v Speaker 1>them hard and we will work through them intensely with

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<v Speaker 1>the EU. But we are by no means done. There

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<v Speaker 1>is no deal that has done. The Prime Minister issues

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<v Speaker 1>soon next, speaking there to Bloomberg's Maria today O Government

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<v Speaker 1>sources say that any deal is unlikely to be announced

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<v Speaker 1>before Tuesday. Facebook and Instagram's parent company appears to be

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<v Speaker 1>taking a leaf out of Twitter's book by offering verification

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<v Speaker 1>deals to subscribers. The service will include a handful of

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<v Speaker 1>additional parks and feature is including account verification, badgers, meta verified,

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<v Speaker 1>wild Cast eleven dollar month of purchased directly, and is

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<v Speaker 1>said to be primarily targeted at content creators. And Finally,

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<v Speaker 1>North London property prices are surging as young professionals returned

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<v Speaker 1>to jobs in the capital after the pandemic. Bloomberg's You

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<v Speaker 1>in Pots reports now. Property website right Move says asking

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<v Speaker 1>prices in Camden are seventeen percent higher than a year

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<v Speaker 1>ago and are up by six percent in the past

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<v Speaker 1>month alone. Neighboring Barnett and Islington also notched up and

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<v Speaker 1>your gains of about eight percent. The wider picture across

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<v Speaker 1>the capitol is more nuanced and asking prices are just

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<v Speaker 1>a snapshot, but the activity in Camden does suggest there's

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<v Speaker 1>burgeoning strength in the broader market. According to right Move,

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<v Speaker 1>average rates for a fifteen percent deposit five year fixed

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<v Speaker 1>rate mortgage and now about four point eight percent. That's

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<v Speaker 1>down from five point nine percent back in October after

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<v Speaker 1>the Liz Trust many budgets. Most economists do expect property

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<v Speaker 1>parties to be lower by the end of this year

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<v Speaker 1>than where they are now in London. I'm you and

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<v Speaker 1>pots Bloomberg Daybreak Europe. Okay, therese are a few of

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<v Speaker 1>our top stories for you this morning. You heard from

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<v Speaker 1>Rically Soon at the Prime Minister there, who was speaking

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<v Speaker 1>to our own Bloomberg. Maria Todeo, who was at the

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<v Speaker 1>Munich Security conference over the weekend. This is kind of

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<v Speaker 1>a hugely important forum where leaders from around the world gather.

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<v Speaker 1>I think it's quite interesting that there were protests anti

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<v Speaker 1>will protests on the streets in Munich over the weekend,

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<v Speaker 1>and of course it comes as the bathters awarded this

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<v Speaker 1>German language, real anti warn movie with a whole host

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<v Speaker 1>of awards, and that's all quite on the Western front,

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<v Speaker 1>of course, based on on the book around World War One.

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<v Speaker 1>But I just thought that was kind of an interesting tie.

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<v Speaker 1>I mean, it's it's the thing that I think people

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<v Speaker 1>in Europe are thinking about the war in Ukraine. Yeah,

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<v Speaker 1>and seeing the focus on that as well, very interesting

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<v Speaker 1>to hear the commentary outcoming out of that security conference

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<v Speaker 1>as well. In the terms of the Bathters, I was

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<v Speaker 1>watching to see the band She's vent A Sharon did

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<v Speaker 1>as well for four awards. Martin McDonough did make the

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<v Speaker 1>joke when he got up to accept the award for

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<v Speaker 1>Best British Film, Best wat Film because of course the

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<v Speaker 1>film was shot in Ireland with the Narge the Irish

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<v Speaker 1>cast and crew, but did have British funding starts how

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<v Speaker 1>it ended up in that category the BAFTAs as well,

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<v Speaker 1>But lots of winners to be watched out for, you know,

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<v Speaker 1>everything everywhere all at once. Not managing to win as

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<v Speaker 1>many prizes have been expected. That's a big, you know,

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<v Speaker 1>front runner for the Oscars as well, just one prize

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<v Speaker 1>and it's ten BAFTA nomination. There were eleven female directors.

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<v Speaker 1>So that made quite a splash, didn't it, in terms

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<v Speaker 1>of across all of the categories. Eleven female diet. That's

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<v Speaker 1>been a big issue, you know, trying to get more

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<v Speaker 1>women directors to be kind of noticed by these big awards. Yeah,

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<v Speaker 1>one bit of glamor for us to bring you on

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<v Speaker 1>a Monday morning. All right, up next, Ireland's economic growth

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<v Speaker 1>is real, insists its central banker Ellen fails to pick

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<v Speaker 1>up the bill for Twitter and UK retail is a

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<v Speaker 1>need of therapy. Now the paper review on blue Bird

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<v Speaker 1>Daybreak Europe. The views you need to know from today's papers.

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<v Speaker 1>Let's have a look at the papers with Bloom, Basley

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<v Speaker 1>and Garan's Good morning Leon. So the Financial Times headline

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<v Speaker 1>the Irish Central banker defends runaway economic growth as real. Yes, indeed, Caroline,

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<v Speaker 1>good morning to you. So an Irish theme after the

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<v Speaker 1>bathtors and now we're going to the ft Now. Speaking

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<v Speaker 1>to the Financial Times, the Governor of the Irish Central Bank,

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<v Speaker 1>Gabrielle mcclouf, said that much of Ireland's growth, which is

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<v Speaker 1>actually forecast to be twelve point two percent last year,

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<v Speaker 1>that's more than treble the EU average, comes from real

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<v Speaker 1>factories with real people, even if a lot of the

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<v Speaker 1>activity stems from these big tech companies and pharmaceutical groups.

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<v Speaker 1>Now mcclouth in this particular article is pushing back against

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<v Speaker 1>accusations that the high level of economic growth is distorted

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<v Speaker 1>and that's because of big US companies taking advantage of

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<v Speaker 1>Dublin's low corporate taxes. Now, the debate around this An

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<v Speaker 1>Island's economic outperformance really took center stage after the country's

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<v Speaker 1>three point five percent quarter on quarter growth in GDP

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<v Speaker 1>really single handedly prevented the Eurozone economy from stagnating in

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<v Speaker 1>the final three months of last year. Many big US companies,

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<v Speaker 1>including Google, Apple, Meta, Intel and Fiser have their European

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<v Speaker 1>basis in Ireland, which has a relatively low twelve point

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<v Speaker 1>five percent corporation tax. And also recently we heard that

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<v Speaker 1>the drugmaker astra Zenica wants to move some of its

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<v Speaker 1>services over to Dublin too instead of investing here in

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<v Speaker 1>the UK for the tax reasons. Yeah, I mean, it's

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<v Speaker 1>interesting to hear what Gary mccluse the argument is trying

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<v Speaker 1>to make is that it's not this is not just

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<v Speaker 1>due to intellectual property earning. It's actually there are factories

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<v Speaker 1>and manufacturing things, particularly when it comes to biomedical sciences,

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<v Speaker 1>Island as a massive exporter of that. The IRIS Statistics

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<v Speaker 1>Office actually has a different measure of GDP that they

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<v Speaker 1>used called G and I star, which strips out some

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<v Speaker 1>of the effects of globalization, and that's kind of what's

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<v Speaker 1>regarded more in terms of the how they measure the

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<v Speaker 1>performance of the Irish economy from the statistics point of

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<v Speaker 1>view in Ireland. But it's an interesting you know when

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<v Speaker 1>you when you look at the effect that Ireland's economic

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<v Speaker 1>growth had on the oldall are you reading in in

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<v Speaker 1>the Yeah, I mean look, but the twelve and a

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<v Speaker 1>half percent tax um um corporation tax that's been known

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<v Speaker 1>for a long time. The accusation is sort of nothing

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<v Speaker 1>new around around Ireland, but very very interesting though to

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<v Speaker 1>hear those comments from Macliffe. Look the Wall Street Journal

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<v Speaker 1>not that Elon Musque story. The wall Stree Journal says

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<v Speaker 1>that under Elon mask, Twitter faces suits claiming over fourteen

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<v Speaker 1>million dollars in unpaid bills. What's going on with the

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<v Speaker 1>bills of Elon Musque? Yes, indeed, Caroline, So since Elon

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<v Speaker 1>Musk took over Twitter, it's faced a grown list of

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<v Speaker 1>claims that it hasn't paid its bills as a social

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<v Speaker 1>media company is aiming to break even this year landlords,

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<v Speaker 1>consultants and vendors, and recent months have made demands for

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<v Speaker 1>payments in at least nine lawsuits now. According to The

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<v Speaker 1>Wall Street Journal, the complaints against the social media company

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<v Speaker 1>are said to be a fourteen million dollars plus interests,

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<v Speaker 1>so no small fee there. Musk career before Twitter included

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<v Speaker 1>very very close brushes with financial doom, including Tesner nearly nearly,

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<v Speaker 1>very nearly running out of money, and Elon Musk has

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<v Speaker 1>spoken about this on more than one occasion. Now. The

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<v Speaker 1>newspaper reports that Musk says, we're not behind because we

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<v Speaker 1>can't pay them, it's just because we're arguing whether the

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<v Speaker 1>parts are actually right. So he wants to have a

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<v Speaker 1>look at these deals again. I just want to bring

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<v Speaker 1>your attention to one outstanding invoice. It's for seven thousand

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<v Speaker 1>dollars and it was a swag bag gift box for

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<v Speaker 1>Elon Musk now included sand blasted logo on Japanese whiskey bottle,

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<v Speaker 1>an extra large bomber jacket, and more than two hundred

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<v Speaker 1>and fifty dollars worth of socks. I know, whiskey socks

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<v Speaker 1>and warmer jackets bag but in all honesty, it's you know,

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<v Speaker 1>other people are suffering because of these out these outstandings,

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<v Speaker 1>And I was going to say, you can't argue with

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<v Speaker 1>the bill by not paying it. Certainly not for the

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<v Speaker 1>landlords in London who are pretty frustrated by the sounds

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<v Speaker 1>of things. But yeah, that's an inter swing, the one

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<v Speaker 1>in the Wall Street Journal. Let's turn next to the Guardian.

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<v Speaker 1>The headline there last of nearly fifteen UK retail jobs,

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<v Speaker 1>a brutal start of according to a report. Yeah indeed,

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<v Speaker 1>and this is according to the Center for Retail Research,

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<v Speaker 1>and they're saying a majority of job losses are at

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<v Speaker 1>these big large retailers such as both Tesco and Asda.

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<v Speaker 1>Some of the main supermarkets that we shop in now

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<v Speaker 1>national retailers we do know this, including paper Chase, the

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<v Speaker 1>clothing chain, EMM and Co, a Chile giant, have all

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<v Speaker 1>gone by in recent weeks, well Wilco, new Look and supermarkets.

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<v Speaker 1>Tesco and Asda have all announced these job cuts. Now,

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<v Speaker 1>we do know that retail job losses have been mounting

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<v Speaker 1>for several years, and that even came before those lengthy

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<v Speaker 1>closures after repeated COVID lockdowns, and according to The Guardian,

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<v Speaker 1>large retail chains which have ten or more stores across

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<v Speaker 1>the UK High Street are doing the biggest cuts when

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<v Speaker 1>it comes to jobs. And a reevaluation of business rates,

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<v Speaker 1>which are among the largest operating costs for retailers, is

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<v Speaker 1>taking place from the first of April and looks likely

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<v Speaker 1>to reduce the rateable values used to determine bills. So

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<v Speaker 1>we are hearing about these massive job losses across the

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<v Speaker 1>high Street. We've seen lots of department stores closed. Here Caroline,

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<v Speaker 1>that was so used to seeing Debonym's and many of them,

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<v Speaker 1>and now we're just seeing these job losses across the

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<v Speaker 1>retail More pressure on the chances Jeremy Hahn to do

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<v Speaker 1>something about those. Business rates are a complaint of old

0:13:05.120 --> 0:13:07.720
<v Speaker 1>really for businesses and how they are affected. Thanks so much, Lean.

0:13:07.800 --> 0:13:10.120
<v Speaker 1>Going for a look at the newspapers. Well, let's get

0:13:10.160 --> 0:13:13.240
<v Speaker 1>more down the weekend's diplomatic maneuvers at the Munich Security Conference,

0:13:13.240 --> 0:13:15.520
<v Speaker 1>the US Secretary of State Anthony B. Lincoln and China's

0:13:15.559 --> 0:13:18.160
<v Speaker 1>top lip amout wang E mess but failed to calm

0:13:18.240 --> 0:13:22.079
<v Speaker 1>tensions after the shooting down of that suspected Chinese spy balloon.

0:13:22.200 --> 0:13:25.520
<v Speaker 1>For more, let's speak to Bloomberg's Bruce Einhorn in Hong Kong. Bruce,

0:13:25.760 --> 0:13:29.400
<v Speaker 1>did this meeting change anything in this ratcheting up of

0:13:29.440 --> 0:13:33.920
<v Speaker 1>tensions that we've had over the balloon incident? Well? I think, Um,

0:13:33.960 --> 0:13:35.360
<v Speaker 1>you know, you have to look at the glass half

0:13:35.360 --> 0:13:37.280
<v Speaker 1>full version of it, which is at least they're talking

0:13:37.280 --> 0:13:40.160
<v Speaker 1>to one another, right, Um. But Um, aside from that, no,

0:13:40.280 --> 0:13:43.160
<v Speaker 1>there wasn't. There wasn't a whole lot to point to

0:13:43.160 --> 0:13:45.840
<v Speaker 1>to show that tensions are easing. Of course, this is

0:13:46.280 --> 0:13:48.520
<v Speaker 1>um the first time that that there's been a high

0:13:48.600 --> 0:13:51.559
<v Speaker 1>level meeting between the two sides since the balloon incident. Um,

0:13:51.880 --> 0:13:54.880
<v Speaker 1>US Secretary History to Lincoln was supposed to be going

0:13:54.880 --> 0:13:58.280
<v Speaker 1>to China. He called off that visit. Um. They haven't

0:13:58.280 --> 0:14:01.520
<v Speaker 1>said that it was canceled. They said it's postponed. Um,

0:14:01.559 --> 0:14:03.840
<v Speaker 1>but we haven't heard anything about when it will take place.

0:14:03.920 --> 0:14:07.200
<v Speaker 1>And given the exchanges that took place in Munich, Um,

0:14:07.200 --> 0:14:10.320
<v Speaker 1>it's unclear when the two sides will be ready to

0:14:10.480 --> 0:14:13.680
<v Speaker 1>have that kind of a high level meeting. Okay, look

0:14:13.720 --> 0:14:15.800
<v Speaker 1>on the balloon issue, though it's in the past, and

0:14:15.840 --> 0:14:18.480
<v Speaker 1>it's kind of finger pointing. I think the bigger issue

0:14:18.520 --> 0:14:22.040
<v Speaker 1>surely is Ukraine. The kind of blunt statements that b.

0:14:22.080 --> 0:14:26.800
<v Speaker 1>Lincoln made about what China may do with Russia. Yes, so,

0:14:27.200 --> 0:14:29.840
<v Speaker 1>the Secretary of States said that the US has intelligence

0:14:30.160 --> 0:14:34.040
<v Speaker 1>that China is preparing to provide military assistance to Ukraine,

0:14:34.120 --> 0:14:37.840
<v Speaker 1>something that China has denied. China has said that far

0:14:37.920 --> 0:14:41.840
<v Speaker 1>from that, they're actually trying to arrange for some sort

0:14:41.880 --> 0:14:46.360
<v Speaker 1>of a peaceful settlement in Ukraine. Um. So again two

0:14:46.480 --> 0:14:49.840
<v Speaker 1>very distinct, very different views of what's happening between the

0:14:49.920 --> 0:14:53.200
<v Speaker 1>US and China when it comes to the Chinese role

0:14:53.200 --> 0:14:58.240
<v Speaker 1>in Ukraine. And meanwhile, Wangi seeking warmer political relations it

0:14:58.280 --> 0:15:02.280
<v Speaker 1>seems with the European Union. Uh, well, that is part

0:15:02.280 --> 0:15:05.200
<v Speaker 1>of a Chinese effort to try to split off the

0:15:05.240 --> 0:15:08.880
<v Speaker 1>Europeans from the Americans. Um We've seen that before, say,

0:15:08.960 --> 0:15:13.520
<v Speaker 1>with China's attempt to try to get the Netherlands to

0:15:13.680 --> 0:15:16.360
<v Speaker 1>not go along with U S sanctions when it comes

0:15:16.360 --> 0:15:20.360
<v Speaker 1>to semiconductors. That didn't succeed. We'll see if they have

0:15:20.440 --> 0:15:24.560
<v Speaker 1>any better luck this time. This is Bloomberg Daybreak Europe,

0:15:24.560 --> 0:15:27.360
<v Speaker 1>your morning brief on the stories making news from London

0:15:27.400 --> 0:15:30.000
<v Speaker 1>to Wall Street and beyond. Look for us on your

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0:15:36.480 --> 0:15:39.400
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0:15:39.480 --> 0:15:42.600
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0:15:42.600 --> 0:15:46.600
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0:15:46.720 --> 0:15:50.760
<v Speaker 1>played Bloomberg thirty. I'm Caroline Heitka and I'm Stephen Carroll.

0:15:50.800 --> 0:15:53.160
<v Speaker 1>Join us again tomorrow morning for all the news you

0:15:53.200 --> 0:15:56.120
<v Speaker 1>need to start your day right here on Bloomberg Daybreak

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<v Speaker 1>Europe eight