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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Daybreak You Up podcast, available every morning on Apple, Spotify

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Speaker 1: or wherever you listen. It's Thursday, the fifth of December.

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Speaker 1: Here in London, I'm Caroline Hepke.

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Speaker 2: And I'm Stephen Carroll in Paris, where French President Emmanuel

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Speaker 2: Macran faces a deepening crisis after his government was toppled

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Speaker 2: last night. As far right leader Marie Lepenze's her political

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Speaker 2: star rise, the Eve's second largest economy could face months

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Speaker 2: of political paralysis, and bond markets are taking notes.

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Speaker 1: And in other news, United Healthcare CEO Brian Thompson has

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Speaker 1: been shot dead in New York, with the perpetrator still

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Speaker 1: at large. Plus topping one hundred thousand dollars, Bitcoin passes

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Speaker 1: the milestone on news that Trump is picking a crypto

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Speaker 1: proponent as his top financial regulator. Let's start with a

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Speaker 1: roundup of our top stories.

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Speaker 2: French President Emmanuel Macron is this morning's seeking a new

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Speaker 2: prime minister after the government of Michelle Barnier was toppled

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Speaker 2: by a no confidence vote. But whoever replaces Barnier will

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Speaker 2: face the same difficulty in building support in the National Assembly,

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Speaker 2: and passing a budget that brings the country's budget deficit

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Speaker 2: under control. Speaking ahead of the vote, Michelle Barnier defended

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Speaker 2: his plan, which contained sixty billion euros in tax hikes

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Speaker 2: and spending cuts. His words are spoken by a translator.

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Speaker 3: Sixty billion in interest which the French people will have

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Speaker 3: to pay every year, which is higher than our defense

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Speaker 3: budget or higher education budget, and it will certainly get

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Speaker 3: even bigger if we do nothing.

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Speaker 2: Barney was ousted after a left wing coalition teamed up

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Speaker 2: with Farright leader Mallie Lepen's National Rally party to pass

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Speaker 2: the no confidence motion. She says the budget was not

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Speaker 2: what the public voted for.

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Speaker 3: Stop public expenditures that the public is not in favor of.

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Speaker 3: We are going to take this all the way because

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Speaker 3: the only response we've had just taxes, taxes, taxes.

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Speaker 2: As Marie Lapan there speaking through a translator, the result

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Speaker 2: of the vote, while expected, pitches the country into a

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Speaker 2: period of turbulence that's likely to further unsettle investors.

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Speaker 1: Will Traders are now weighing the path ahead for the

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Speaker 1: euro with Skylo Montgomery coning of Berkley, saying that events

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Speaker 1: can only be considered a headwind for the currency. French

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Speaker 1: borrowing costs relative to Germany's have soared in recent weeks,

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Speaker 1: with the spread hitting the widest since the euro Area

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Speaker 1: debt crisis, and European Central Bank President Christine Legarde is

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Speaker 1: now calling on the European Union to ramp up efforts

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Speaker 1: to unify its fragmented financial infrastructure. Writing in the Economists,

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Speaker 1: the head of that French vote, Laguard, said Europe must

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Speaker 1: refocus exposing the key blockages in the financing pipeline and

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Speaker 1: identifying a smaller number of solutions with the highest return.

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Speaker 2: Brian Thompson, the CEO of United Healthcare, was shot dead

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Speaker 2: in Manhattan on Wednesday morning. The fifty year old was

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Speaker 2: one of United Health's most senior executives and was outside

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Speaker 2: the New York Hilton mid Ten, where the company was

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Speaker 2: hosting its investor Day. The suspect fired multiple times before fleeing,

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Speaker 2: prompting an ongoing manhunt. Here's New York Police Commissioner Jessica Tish.

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Speaker 4: I want to be clear at this time, every indication

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Speaker 4: is that this was a premeditated, pre planned, targeted attack.

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Speaker 2: Jessica Tish, there, speaking as police offered a ten thousand

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Speaker 2: dollars reward for tips. According to the New York Police Department,

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Speaker 2: Brian Thompson arrived in New York on Monday and didn't

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Speaker 2: travel with a security detail. In a phone call with

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Speaker 2: NBC News, his wife said he had been receiving threats.

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Speaker 1: Bigcoin has surged to a record of more than one

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Speaker 1: hundred thousand dollars after Donald Trump picked the cryptoppponent Paul

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Speaker 1: Atkins is the next head of the US Securities Regulator.

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Speaker 1: The digital asset rose as much as six point one

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Speaker 1: percent following the announcement that Atkins would replace Gary Gensler,

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Speaker 1: who cracked down on digital assets. Nathan Dean, senior policy

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Speaker 1: analyst at Boomberg Intelligence, says the pick will bring significant change.

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Speaker 5: This is the first time that they've really had somebody

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Speaker 5: in the regulatory repertoire, if you will, that's going to

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Speaker 5: be thinking of the crypto world. And so, you know

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Speaker 5: Commissioner Akins, because he used to be a commissioner at

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Speaker 5: the SEC, you know he has actually come out and

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Speaker 5: has done a lot of work in the crypto space.

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Speaker 5: But where we're going with this is that you know,

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Speaker 5: the SEC chair has a really important role because they

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Speaker 5: can put out a ruling giving a little bit more

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Speaker 5: of the color of okay, here, what are the rules

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Speaker 5: for crypto? Meaning, if you have a security and you

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Speaker 5: are in exchange like coinbase, here's how you operate.

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Speaker 1: Nathan Dean from Bloomberg Intelligence, speaking there. The crypto market

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Speaker 1: has jumped by roughly one point three trillion dollars since

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Speaker 1: Donald Trump's election victory, with bitcoin ETFs attracting a yet

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Speaker 1: inflow of about thirty two billion dollars.

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Speaker 2: Federal Reserve charge. Jerome Powell says he expects to have

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Speaker 2: good relations with the incoming Trump administration. Speaking at the

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Speaker 2: New York Times deal Book Summits, the central banker downplayed

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Speaker 2: the prospects of tension with the president elect.

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Speaker 6: There's a set of institutional relationships between the FED and

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Speaker 6: every administration. I fully expect that we'll have the same

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Speaker 6: general kinds of relationships that we have institutional relationships, for

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Speaker 6: example with the Council of Economic Advisors, but most importantly

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Speaker 6: with the Treasury Department.

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Speaker 2: Jerome Powell, speaking in New York. Turning to economic matters,

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Speaker 2: he added that he expects FED officials to move cautiously

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Speaker 2: as they continue cutting rates, but that he says the

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Speaker 2: economy is in remarkably good shape. His comments come as

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Speaker 2: US docs hit an all time high owing to irrally

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Speaker 2: in big tech, which drove the S and P five

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Speaker 2: hundred to its fifty sixth closing record in twenty twenty four.

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Speaker 1: The CEO of Lloyd's Bank has warned that the uncertainty

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Speaker 1: around motor finance miss selling is affecting investor confidence in

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Speaker 1: British banking. Charlie Nunn says that investors have raised worries

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Speaker 1: about the UK's lengthy review of calf finance after a

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Speaker 1: court ruling that could significantly broaden its scope. As part

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Speaker 1: of the probe, the Financial Conduct Authority is considering giving

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Speaker 1: lenders more time to respond to customer complaints about fixed

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Speaker 1: commissions on auto loans. Lloyd's, the biggest provider of calf finance,

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Speaker 1: has already set aside four hundred and fifty million pounds

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Speaker 1: to pay for possible compensation and other costs linked to

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Speaker 1: the investigation, which Moody's estimates could cost the industry over

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Speaker 1: all some thirty billion pounds. So those are our top

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Speaker 1: stories for you this morning. Let's have a look at

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Speaker 1: the markets then. Right now, we do have fresh political

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Speaker 1: storms earlier this week, with South Korea nowadays France. Asian

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Speaker 1: equities this morning are lowered down by tenth of one

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Speaker 1: percent for the MCI Asia, PAUS Civic Indegs, the S

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Speaker 1: and P five hundred, though yesterday hid afresh another all

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Speaker 1: time record high. Jerome Powell talking about the US economy

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Speaker 1: being in remarkably good shape. We also did see bitcoin

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Speaker 1: pass through one hundred thousand dollars. This morning, we trade

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Speaker 1: at one hundred and two thousand, two hundred dollars, up

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Speaker 1: by four point four percent for bitcoin. South Korea's one

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Speaker 1: has slipped, the Euro is steady, trading at one spot

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Speaker 1: zero five to two seven, the Japanese yen going further

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Speaker 1: to the downside, the Bank of Japan possibly preparing to

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Speaker 1: hike interest rates, and OPEQ plus meeting today. All prices

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Speaker 1: trading at seventy two dollars twenty six a down a

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Speaker 1: tenth of one percent, and stock futures for the European

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Speaker 1: market opened this morning currently down by a tenth of

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Speaker 1: one percent. So those are the markets now. In a moment,

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Speaker 1: we'll talk more broadly about the markets than that bitcoin

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Speaker 1: one hundred thousand dollars, but of course Immanu and Macon

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Speaker 1: faces a deepening political crisis after the no confidence vote

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Speaker 1: last night, backed by Marine le Pen's national rally, which

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Speaker 1: toppled the government led by the Prime Minister Michelle Barnier.

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Speaker 1: Stephen Carroll is live in Paris for us this morning. Stephen,

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Speaker 1: you were there last night watching what was happening in parliament.

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Speaker 1: Macart is due to make an address to the nation.

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Speaker 1: What should we expect after this blow to his authority?

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Speaker 2: I mean, look, it's a question of what sort of

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Speaker 2: tone Emmanuel Macrar is going to choose to take and

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Speaker 2: whether or not he will have any announcement to make

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Speaker 2: in that special address to the nation that he's making. Later,

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Speaker 2: he arrived back in France and a visitor Saudi Arabia

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Speaker 2: just as the voter was happening, toppling the government of

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Speaker 2: Michelle Barnier, making Barnier the shortest lived prime minister in

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Speaker 2: modern French political history, just ninety one days in office.

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Speaker 2: So Emmanuel Macran will be expected to give some details

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Speaker 2: about what happens next, but there are no hints as

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Speaker 2: to what the president plans to talk about in this address.

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Speaker 2: What will want answers to is who's going to run

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Speaker 2: the government. Who's going to lead a government, how quickly

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Speaker 2: they're going to be appointed, and how they're going to

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Speaker 2: tackle some of the big issues facing France, not least

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Speaker 2: the financial ones.

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Speaker 1: Indeed, I mean Michelle Barnier himself was sort of the

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Speaker 1: answer to a difficult problem, wasn't he. What went wrong?

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Speaker 1: Do you think for Michelle Barnier?

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Speaker 2: I mean, he was dealt a very poor hand to

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Speaker 2: start out. He had no majority in Parliament to begin with.

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Speaker 2: The choice of Michelle Barnieu was meant to try and

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Speaker 2: inspire centrist politicians to come together with this person who'd stepped,

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Speaker 2: you know, into the political fray, someone who had a

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Speaker 2: fifty year career in politics in France and had held

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Speaker 2: already several senior ministries as well as his jobs in

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Speaker 2: the European Union. That those outside of France might know

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Speaker 2: him for better. But he was supposed to be the

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Speaker 2: person that was going to bring on board more people

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Speaker 2: to Macron's centrist alliance. He did his best. He said

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Speaker 2: that he was going to negotiate in parliament to try

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Speaker 2: and get agreement on a budget. There were some compromises

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Speaker 2: reached on some issues, but not enough for him to

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Speaker 2: survive a vote on This was the social security budget

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Speaker 2: that he used the constitutional override to force through Parliament,

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Speaker 2: triggering the no confidence vote. I mean, listening to him

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Speaker 2: last night in parliament, he was talking about how things

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Speaker 2: will get worse now if the government falls as it

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Speaker 2: did subsequently. And look, it just wasn't a very easy

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Speaker 2: job to begin with. But that begs the question of

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Speaker 2: who could do it better and who could resolve those

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Speaker 2: seemingly intractable problems that whoever is going to be taking

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Speaker 2: this job next is going to face.

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Speaker 1: What does it mean now for Marine le Pen, who

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Speaker 1: was also central to toppling the government.

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Speaker 2: Well, look, I mean she is coming from a position

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Speaker 2: of strength now, her having allied with a left wing

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Speaker 2: alliance in Parliament, which by itself is quite controversial because

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Speaker 2: they have extremely differing views on things and supporters of

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Speaker 2: a manual macro Ath Michelle Bagni were quick to point

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Speaker 2: out the supposed controversial nature of this alliance, that the

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Speaker 2: left wing and the far right chose to vote together

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Speaker 2: on this issue despite all of their differences in the

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Speaker 2: many criticisms that would have come from those left wing

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Speaker 2: parties of some of the policies of Marie Le Penn's

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Speaker 2: party too, But I mean she has an eye and

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Speaker 2: she pointed to it in her speech in Parliament yesterday

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Speaker 2: supporting this votion of no confidence on what Emmanuel Macron

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Speaker 2: does next, she said she wouldn't call on him to resign.

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Speaker 2: That was a decision for him. Some of the left

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Speaker 2: wing politicians were out there straight away saying the Manu

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Speaker 2: Macron needs to resign. But Macron has until twenty twenty

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Speaker 2: seven on his term. There is no mechanism to remove

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Speaker 2: him from office. Mary Lepenn knows that she's leading in

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Speaker 2: the polls if there were to be a presidential election held.

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Speaker 2: Now this is the moment that she can exact pressure

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Speaker 2: because actually getting her group on board, or at least

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Speaker 2: convincing them to abstain from a vote on a future budget,

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Speaker 2: could be key to whatever Agreen too her alliance has created.

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Speaker 2: Next perhaps she can get some of her key policies

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Speaker 2: actually into a budget that she can claim credit for.

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Speaker 7: Yeah.

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Speaker 1: Absolutely, I mean what does happen now with no budget agreed?

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Speaker 1: Because that was the sticking point, and of course there

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Speaker 1: can't be any elections either until next year.

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Speaker 2: I mean, in the short term, what happens is at

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Speaker 2: ten o'clock this morning, we will see Michelle Barney present

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Speaker 2: the resignation of his government. The next steps to try

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Speaker 2: and keep the government running is that a special law

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Speaker 2: can be passed through parliament. This is thought to be

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Speaker 2: the simplest way to enact this, which essentially puts the

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Speaker 2: government on a month to month budget where they get

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Speaker 2: a twelfth of what was the current year's budget allocated

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Speaker 2: to each department. That will keep benefits being paid, taxes

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Speaker 2: being collected and government services running as well. But it

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Speaker 2: is something that is going to make life much more

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Speaker 2: difficult and it's certainly not going to tackle problems around

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Speaker 2: the budget deficit or do anything to cam market fears

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Speaker 2: over Francis fiscal path.

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Speaker 1: Yes, indeed, well when we think about that mark situation

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Speaker 1: then obviously that the kind of term will in the

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Speaker 1: run up to the vote yesterday has roiled financial markets,

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Speaker 1: although overnight the Euros actually remain fairly calm, and I

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Speaker 1: mentioned also that bitcoin top one hundred thousand dollars. So

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Speaker 1: I want to bring in at this point Stephen b

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Speaker 1: Inbode's Multi Asset report in Mary Nicola to join us

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Speaker 1: for a conversation. Mary, good morning, What do you think

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Speaker 1: is the impact then, of France's political shock on markets

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Speaker 1: given the outcome of the vote. I mean it was

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Speaker 1: expected that vote last night.

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Speaker 7: Yeah, it was, and I think there's arguably a lot

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Speaker 7: priced in. But at the same time, there's still so

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Speaker 7: much uncertainty, as both you and Stephen had mentioned, that

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Speaker 7: suggests that the worst isn't behind us. So you still

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Speaker 7: have a new government that will have to be formed

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Speaker 7: and a credible budget that needs to be passed, and

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Speaker 7: given the political disarray, there's probably a lot more to come.

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Speaker 7: Growth in France is already very tabid. Monetary policy remains

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Speaker 7: relatively restrictive, especially when you look at the growth outlook,

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Speaker 7: and then not to mention that the budget metrics looks

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Speaker 7: worse than many of its peers within Europe, suggesting that

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Speaker 7: it's going to continually be penalized by markets for that.

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Speaker 1: Yeah. Okay, So that's one significant issue that will be

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Speaker 1: watching in markets today than any further signs of market stress,

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Speaker 1: especially when the bond markets in Europe are open. In

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Speaker 1: terms of Bitcoin, the other big story in markets dramatic

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Speaker 1: rally after Trump has picked a crypto advocate to lead

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Speaker 1: the SEC. That's quite a change isn't it for that

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Speaker 1: main regulator in the US and globally it is.

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Speaker 7: And I think one of the things that probably excites

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Speaker 7: a lot of cryptoubles is the fact that you're seeing

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Speaker 7: this intersection between you know, the trad FI and the

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Speaker 7: DeFi investing, and that could potentially mean that you smooth

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Speaker 7: the way from more people to buy this asset class.

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Speaker 7: So in general, we could expect that the administration, of

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Speaker 7: course is going to be a lot friendlier to crypto

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Speaker 7: than some of the other previous administrations, which does give

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Speaker 7: some confidence to more people to dive into that asset class.

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