WEBVTT - (Radio) 0:00:02.240 --> 0:00:05.120 This is Bloomberg Daybreak Weekend, our global look at the 0:00:05.200 --> 0:00:07.440 top stories in the coming week from our Daybreak anchors 0:00:07.520 --> 0:00:09.479 all around the world. And just to hand on the 0:00:09.520 --> 0:00:12.520 program with all the layoffs, how much is the job 0:00:12.560 --> 0:00:16.000 market really weakening? I'm John Tucker in New York. I'm 0:00:16.000 --> 0:00:18.320 Stephen carl in London, where the shops and restaurants are 0:00:18.320 --> 0:00:20.680 full of festive chair but the wider picture for the 0:00:20.720 --> 0:00:24.200 consumer sector is looking what's gloomier. I'm Duck Chrissener. We'll 0:00:24.200 --> 0:00:27.680 look at the many challenges facing the Chinese consumer. I'm 0:00:27.680 --> 0:00:30.400 Amy Morris in Washington, will look at the career and 0:00:30.560 --> 0:00:36.479 legacy aboutgoing House speaker Nancy Pelosi. That's all straight ahead 0:00:36.520 --> 0:00:40.480 on Bloomberg Daybreak Weekend on Bloomberg eleven three, on New York, 0:00:40.640 --> 0:00:45.240 Bloomberg one, Washington d C, Bloomberg one oh six one, Boston, 0:00:45.360 --> 0:00:49.680 Bloomberg nine sixties, San Francisco d A B, Digital Radio, London, 0:00:49.880 --> 0:00:53.360 Sirius XM one nineteen and around the world on Bloomberg 0:00:53.440 --> 0:00:58.800 Radio dot com and via the Bloomberg Business at Hi, Everybody, 0:00:58.800 --> 0:01:01.440 I'm John Tucker. An let'st today's program with a look 0:01:01.440 --> 0:01:03.600 at the jobs market. Joining us now to talk about 0:01:03.600 --> 0:01:08.640 at Bloomberg Global Economics and Policy editor Michael McKee. You know, 0:01:08.680 --> 0:01:10.920 we've had tens of thousands of job cuts in the 0:01:10.959 --> 0:01:14.160 past few weeks, a lot of them in technology. What 0:01:14.600 --> 0:01:17.679 are we expecting to see in this week's jobs report? 0:01:17.720 --> 0:01:19.480 Any of the is gonna show up in this report. 0:01:19.760 --> 0:01:22.720 We're not expecting it. Uh. We may see some declines 0:01:22.720 --> 0:01:26.160 in tech employment, but it appears most people are finding 0:01:26.160 --> 0:01:28.560 new jobs fairly quickly, at least according to the jobless 0:01:28.560 --> 0:01:33.520 claims numbers, and so tech is a very small part 0:01:33.560 --> 0:01:38.120 of the overall labor market. There are hundred forty six 0:01:38.200 --> 0:01:41.480 million jobs in America, and so tens of thousands is 0:01:41.520 --> 0:01:44.760 still a very small percentage. Is the employment report? The 0:01:44.840 --> 0:01:49.600 jobs reports still the mother of all economic reports? Well, 0:01:49.680 --> 0:01:51.960 it may be the mother of all economic reports. The 0:01:52.000 --> 0:01:54.680 c p I s maybe the mother in law of 0:01:55.200 --> 0:01:58.040 all economic reports because the FED is kind of focused 0:01:58.120 --> 0:02:02.640 more on prices these days. But the Jobs report is 0:02:02.640 --> 0:02:05.000 always going to be there because it's a sign of 0:02:05.040 --> 0:02:07.720 the strength of the economy. And we're moving into a 0:02:07.760 --> 0:02:11.760 period now where we've had the FED focused on how 0:02:11.880 --> 0:02:14.640 fast it was going to move and how high it 0:02:14.760 --> 0:02:17.680 was going to move. And now the question that seems 0:02:17.680 --> 0:02:19.840 to be developing in the markets is, Okay, if we 0:02:19.960 --> 0:02:22.720 buy your idea that you go to five cent and 0:02:22.800 --> 0:02:26.040 you do it more gradually, when you're gonna start cutting, 0:02:26.400 --> 0:02:29.640 and that will depend on the economy. If the jobless 0:02:29.720 --> 0:02:32.840 rate starts to rise significantly, then the Fed is going 0:02:32.880 --> 0:02:36.239 to have to think about it. They insist they'll live 0:02:36.320 --> 0:02:38.959 with a higher jobless rate, but if it goes too far, 0:02:39.520 --> 0:02:43.880 then they might start thinking about a rate reduction. So 0:02:44.080 --> 0:02:46.120 that's gonna be the way the debate plays out in 0:02:47.560 --> 0:02:50.600 how tight is the labor market right now? Well, by 0:02:50.600 --> 0:02:54.519 all standard indicators, it's very tight. Still, the number of 0:02:54.600 --> 0:02:59.079 job openings is still very high, and the unemployment rate 0:02:59.160 --> 0:03:03.480 is still very low. The participation rate is not going 0:03:03.600 --> 0:03:07.360 up significantly, so there aren't enough workers to fill all 0:03:07.400 --> 0:03:09.880 the jobs. Is when it comes down to now, you 0:03:09.919 --> 0:03:12.399 may have a labor mismatch where the people who are 0:03:12.440 --> 0:03:16.360 available to work don't have the skills necessary for the 0:03:16.440 --> 0:03:19.080 jobs that are open. That's hard to prove, but it 0:03:19.240 --> 0:03:21.560 is a theory for part of why we see such 0:03:21.600 --> 0:03:26.200 a high rate of job openings. But the other situation 0:03:26.320 --> 0:03:29.520 is this is totally unusual because everybody lost their job 0:03:29.560 --> 0:03:31.040 at once, and then a lot of people decided to 0:03:31.040 --> 0:03:33.400 not to come back into the labor force and to 0:03:34.040 --> 0:03:36.480 perhaps retire. So there are a lot of jobs going 0:03:36.600 --> 0:03:39.440 unfilled that may never be filled. It probably is the 0:03:39.520 --> 0:03:42.360 FED and economists don't really know how that's going to 0:03:42.400 --> 0:03:44.600 play out. Okay, So if I'm a business owner and 0:03:44.680 --> 0:03:47.360 I need a worker and I can't find anybody out there, 0:03:47.440 --> 0:03:50.240 I'm going to offer more and more pay and maybe 0:03:50.280 --> 0:03:53.160 pay the workers that I do have to keep them, 0:03:53.160 --> 0:03:56.160 going to pay them more, and that's going to feed 0:03:56.160 --> 0:03:58.960 into inflation because then I have to raise my end 0:03:59.000 --> 0:04:01.880 prices that I try to consumers. Does that make sense? 0:04:02.040 --> 0:04:05.040 That makes sense, and it it's what's been happening, particularly 0:04:05.080 --> 0:04:07.600 on the service industry side. We saw it happen in 0:04:07.600 --> 0:04:13.160 manufacturing that's weakened some Now that demand has weakened for goods, 0:04:13.240 --> 0:04:16.760 people spending more on services, and services industries were the 0:04:16.839 --> 0:04:19.960 last to recoup some of the workers that they lost, 0:04:20.160 --> 0:04:24.880 particularly things like restaurants and bars and many retail stores. 0:04:25.160 --> 0:04:28.040 So they have had to raise their pay rates and 0:04:28.080 --> 0:04:30.599 they have had to raise prices to pay for it. 0:04:30.640 --> 0:04:33.080 The question is how many more workers are they going 0:04:33.120 --> 0:04:36.599 to be hiring and then uh those many of those jobs, 0:04:36.640 --> 0:04:40.680 particularly in restaurants and bars, are transitory. People don't stay 0:04:40.680 --> 0:04:44.760 in them very long. They're taking them as a springboard 0:04:44.760 --> 0:04:49.040 to something else, or they're uh going to be looking 0:04:49.080 --> 0:04:52.200 for something else because the job itself is very hard. 0:04:52.880 --> 0:04:56.960 So once you get back to a rough ability to 0:04:57.000 --> 0:04:59.920 serve your customers, do you then need to keep raising 0:05:00.080 --> 0:05:04.640 rates or do you need can you say, well, maybe 0:05:05.000 --> 0:05:07.440 that's it, I'm done, or I'm not going to pay 0:05:07.440 --> 0:05:10.039 as much to the next round of people because now 0:05:10.080 --> 0:05:12.760 I'm backstaffed where I need to be. What's the lag 0:05:12.839 --> 0:05:16.680 time between enacting policy by the Federal Reserve and the 0:05:16.720 --> 0:05:19.920 time it shows up in something like the labor market? Traditionally, 0:05:20.320 --> 0:05:23.200 as Milton Friedman put in, it's long and variable legs 0:05:23.680 --> 0:05:29.120 with no with no timing on it. Estimates by researchers 0:05:29.160 --> 0:05:32.960 have suggested somewhere between twelve and eighteen months, although it 0:05:33.120 --> 0:05:36.520 is kind of accepted wisdom now and certainly at the FED, 0:05:36.839 --> 0:05:39.240 that it's faster than that now because we have so 0:05:39.279 --> 0:05:43.200 many transmission channels that are so quick. You have instantaneous 0:05:43.279 --> 0:05:46.200 payments for things, and you can One of the examples 0:05:46.200 --> 0:05:49.200 always used was restaurants were slow to change prices because 0:05:49.200 --> 0:05:51.120 then they would have to reprint all their menus. But 0:05:51.160 --> 0:05:54.080 now you're just doing it as a PDF that people 0:05:54.120 --> 0:05:56.600 are scanning their phones on, so you can raise prices 0:05:56.680 --> 0:06:00.520 very quickly, so you can see much quicker move into 0:06:00.560 --> 0:06:03.760 the economy. But nevertheless, the feeling is we're only six 0:06:03.800 --> 0:06:06.880 months into this. Seems like forever, but only six months 0:06:06.920 --> 0:06:11.400 into this, and that we may start to see some 0:06:11.480 --> 0:06:14.719 of it really start to hit coming fairly soon. The 0:06:15.080 --> 0:06:18.320 Photo Reserve chairman Jerome pal is going to also speak 0:06:18.400 --> 0:06:21.080 in some format this coming week. What's he expected to 0:06:21.120 --> 0:06:23.000 say will be a check the box kind of thing. 0:06:23.000 --> 0:06:26.039 They'll ask him, we presume how high are you going 0:06:26.120 --> 0:06:29.120 to raise it at this meeting? And the betting is 0:06:29.160 --> 0:06:32.200 he's going to push people to fifty basis points half 0:06:32.200 --> 0:06:34.520 a presentage point, and then how high do you think 0:06:34.600 --> 0:06:37.080 we need to go? And the consensus of the FED 0:06:37.160 --> 0:06:40.279 speakers over the last couple of weeks has been around 0:06:40.360 --> 0:06:44.279 five percent Summer four, seventy five, summer five, somewhere in 0:06:44.320 --> 0:06:47.400 that range. Then the question is how long are you 0:06:47.400 --> 0:06:49.280 going to keep it there? And what are you going 0:06:49.320 --> 0:06:51.800 to look for? And that's what Wall Street wants to 0:06:51.839 --> 0:06:54.960 know Mike as always a pleasure. Michael McKee And just 0:06:55.040 --> 0:06:58.760 to hit on Bloomberg Daybreak weekend, waning consumer confidence in 0:06:58.800 --> 0:07:06.840 the UK. I'm John Tucker and this is Bloomberg. This 0:07:07.240 --> 0:07:09.800 is Bloomberg Daybreak weekend. Are glob to look ahead at 0:07:09.840 --> 0:07:11.960 the top stories for investors in the coming week. I'm 0:07:12.040 --> 0:07:14.480 John Tucker in New York. Up later in the program 0:07:14.520 --> 0:07:18.920 consumers and the economy in China, But first, the UK 0:07:19.120 --> 0:07:22.040 headed toured the holiday season with a recession looming and 0:07:22.120 --> 0:07:25.840 consumer competence lower than it was during the financial crisis. 0:07:26.320 --> 0:07:29.160 Consumers spending is held up so far, but how long's 0:07:29.200 --> 0:07:31.480 that gonna last? For more? Let's hit to London and 0:07:31.520 --> 0:07:36.080 bringing Bloomberg Daybreak europancher Stephen Carol, John Nathan. The lights 0:07:36.080 --> 0:07:38.440 and decorations are up in London and it's as hard 0:07:38.480 --> 0:07:40.640 as ever to get a restaurant booking here. But the 0:07:40.800 --> 0:07:43.520 visible cheer from some is coming at a time as 0:07:43.760 --> 0:07:47.800 deep economic gloom. Overall inflation is at forty year high 0:07:47.800 --> 0:07:50.120 in the UK. We've got rising interest rates at a 0:07:50.200 --> 0:07:53.000 crippling jump in rents and mortgage costs for many. So 0:07:53.040 --> 0:07:57.000 how resilient are Britain's consumers looking in this crucial end 0:07:57.040 --> 0:07:59.800 of year shopping period. Let's bring in our opinion economist 0:07:59.840 --> 0:08:03.320 and afl Stad and Are Bloomberg, Pursuits Reporters, Serrapaport as 0:08:03.320 --> 0:08:06.960 well Andrea. The last retail sales figures showed a little 0:08:07.000 --> 0:08:10.400 bit of growth in October. Consumer confidence surveys still very 0:08:10.480 --> 0:08:12.600 much on the duldrum. What is the picture going to 0:08:12.640 --> 0:08:14.840 be like going into this really important period of the 0:08:14.880 --> 0:08:19.040 year for consumers. Well, the most remarkable thing is despite 0:08:19.160 --> 0:08:22.119 all the doom and gloom and the cost of living 0:08:22.200 --> 0:08:25.800 crisis and all the issues that are consumers are facing, 0:08:26.200 --> 0:08:30.600 they are being remarkably resilient. We've seen a little bit 0:08:30.640 --> 0:08:34.960 of distress. We had made dot com and jewels collapse, 0:08:35.240 --> 0:08:39.520 but aside from that, there is very little distress. The 0:08:39.559 --> 0:08:44.240 most remarkable thing is that nothing's really happened yet. Oh 0:08:44.360 --> 0:08:47.120 yet is the key word, And that we we had 0:08:47.200 --> 0:08:49.080 updates and the likes of you know, high Street Staples here, 0:08:49.120 --> 0:08:51.280 Marks and Spencer's next people like that. What did we 0:08:51.360 --> 0:08:54.400 learn from from their results? We learned that things were 0:08:54.440 --> 0:08:59.520 taking along. Okay, I think this Christmas will be fine. 0:09:00.120 --> 0:09:03.440 I think this will be the last hurrah The important 0:09:03.480 --> 0:09:06.480 thing is that this is the first year for three 0:09:06.920 --> 0:09:10.680 that it will be a relatively normal Christmas. People will 0:09:10.720 --> 0:09:13.840 be out visiting friends of family. When they do so, 0:09:14.040 --> 0:09:19.200 they tend to buy gifts for them. The hospitality industry 0:09:19.400 --> 0:09:24.640 is seeing bookings return, particularly things like office Christmas parties, 0:09:25.000 --> 0:09:28.120 office nights out that really haven't happened for the last 0:09:28.240 --> 0:09:32.240 two years. So I think this Christmas will be fine. 0:09:32.880 --> 0:09:37.280 What we them face is a very nasty hangover in 0:09:37.320 --> 0:09:39.720 the new year, so it could be the next set 0:09:39.720 --> 0:09:41.880 of results before we get that clearer picture of us 0:09:42.000 --> 0:09:46.559 and Sarah some consumers feeling very resilient. Indeed, and you've 0:09:46.600 --> 0:09:50.000 been writing about luxury spas for Bloomberg Pursuits. First of all, 0:09:50.000 --> 0:09:51.880 what did you find out? And secondly, how what's the 0:09:51.920 --> 0:09:54.920 demand looking like for for services like that? Well, like 0:09:54.960 --> 0:09:57.600 andreas Son, you know, luxury is doing great. Luxury is 0:09:57.640 --> 0:10:00.560 doing absolutely fine. People who have money to spend our 0:10:00.640 --> 0:10:03.560 spending it because, like she said, over the past three years, 0:10:03.559 --> 0:10:05.840 you couldn't you couldn't book a five star hotel at 0:10:05.880 --> 0:10:09.000 Christmas to travel from the US without tests or you know, 0:10:09.080 --> 0:10:11.960 vaccines or anything. Now you can in the exchange rate 0:10:12.000 --> 0:10:14.160 is great for Americans and they're coming over here and 0:10:14.200 --> 0:10:17.680 they're spending and what I found in the luxury spot industry. 0:10:17.760 --> 0:10:19.480 So there's a bit of an arms race right now 0:10:19.520 --> 0:10:23.120 within the top hotels, the Bulgari, Spa, Clarridges, the Corinthia 0:10:23.559 --> 0:10:25.760 Claria just just had a huge revamp. Now there's a 0:10:25.760 --> 0:10:27.960 pool when they've read it blows a pool. Now you 0:10:28.000 --> 0:10:30.760 can also get the full celebrity experience with the six 0:10:31.160 --> 0:10:34.360 pound manicure by a celebrity manicurist. Um. I have not 0:10:34.440 --> 0:10:39.360 sampled it, but there's all kinds of really competitive offers 0:10:39.400 --> 0:10:42.319 trying to get the whole v I P experience for 0:10:42.360 --> 0:10:45.000 the one person consumer that they're looking for. Okay, I 0:10:45.000 --> 0:10:46.880 mean there's a good question as to whether or not 0:10:46.920 --> 0:10:49.080 you might have the best job about Bloomberg, Sarah. I 0:10:49.120 --> 0:10:51.240 think I do. I think I think competing with you 0:10:51.280 --> 0:10:53.360 will be our colleague Manus Cranny, who was speaking to 0:10:53.360 --> 0:10:56.560 the CEO of Mode Hennessey Phillips Go and talking about 0:10:56.600 --> 0:10:59.120 the demand that they're seeing for Champagne. Let's take a 0:10:59.120 --> 0:11:02.480 listen in we talked about the roaring twenties in the 0:11:02.640 --> 0:11:06.720 twenty two will be fabulous here for Champagne without giving 0:11:06.760 --> 0:11:09.840 any numbers. We are running all of stock on on 0:11:10.000 --> 0:11:14.000 most of our best trimpains. So I think as people 0:11:14.000 --> 0:11:17.160 have been coming out of COVID, it's been just spent 0:11:17.400 --> 0:11:22.520 up demand for luxury, enjoyment, traveling and all that running 0:11:23.080 --> 0:11:26.200 of stock. How close to the end of the champagne 0:11:26.240 --> 0:11:29.480 stock are we? Well this every year you stop coming fortunately, 0:11:29.840 --> 0:11:32.240 so there will be more to come for next year. 0:11:32.400 --> 0:11:35.600 And that's the SEEO of Mode. Tannessey speaking to Manus Cranny. So, Sarah, 0:11:35.640 --> 0:11:38.480 we've been talking about this boom then in the hospitality sector. 0:11:38.640 --> 0:11:41.040 So we're still, as Andre was telling us, you know, 0:11:41.240 --> 0:11:45.200 still seeing reasonable amount of resilience and consumers when they're 0:11:45.240 --> 0:11:48.760 spending on things, what about what they're spending on going out. Well, 0:11:48.760 --> 0:11:51.160 there might be a nasty hangover in January, as there 0:11:51.160 --> 0:11:53.760 always is, but for now London is fully booked. It's 0:11:53.880 --> 0:11:56.080 very hard to get a table at a top restaurant 0:11:56.200 --> 0:11:59.320 right now. The bars are packed, the West End is packed, 0:11:59.520 --> 0:12:02.319 theater eater is booming. They need this Christmas season to 0:12:02.360 --> 0:12:04.840 be a success. And I'll say there are problems, like 0:12:05.000 --> 0:12:07.480 their gas bills are are very high and they didn't 0:12:07.520 --> 0:12:11.080 have the previous seasons. But right now business is booming 0:12:11.080 --> 0:12:13.400 in the West End in hospitality. People are coming over 0:12:13.480 --> 0:12:16.000 and and they're spending, and of course it's a chance 0:12:16.040 --> 0:12:18.559 for many people to have a blowout after a few 0:12:18.559 --> 0:12:22.240 difficult years. There's that sort of yolo mentality after like 0:12:22.360 --> 0:12:24.840 the lockdown and code. People want to have a big Christmas. 0:12:24.840 --> 0:12:26.800 They want to see their friends and family, they want 0:12:26.840 --> 0:12:29.319 to get back to normality. And even though things are 0:12:29.320 --> 0:12:32.000 more expensive than they were in people are putting it 0:12:32.040 --> 0:12:34.760 on credit cards or they're deciding, you know what, for me, 0:12:34.840 --> 0:12:36.400 this is worth worth it. This year. They're going to 0:12:36.480 --> 0:12:38.520 go out and they'll they'll spend. So yeah, it's going 0:12:38.559 --> 0:12:40.960 to be a big Christmas for hospitality in London. You're 0:12:40.960 --> 0:12:43.559 making me excited about the coming weeks, although I'm quite 0:12:43.559 --> 0:12:45.679 worried about where I'm gonna go for dinner anyway, Andrea, 0:12:45.760 --> 0:12:48.480 let's talk about the consumer luxury sector, which is I 0:12:48.520 --> 0:12:52.160 suppose in that space of the Champagne and the high 0:12:52.240 --> 0:12:54.160 end spas that Sarah was telling us about, what does 0:12:54.160 --> 0:12:57.120 the picture look like, They're it's very similar. What we're 0:12:57.160 --> 0:12:59.839 seeing in luxury is we're seeing the very top end 0:13:00.040 --> 0:13:05.160 to continue to spend on her Mayor's Hamburgs our Hamburgs. 0:13:05.200 --> 0:13:07.800 What we're just starting to see this is more in 0:13:07.840 --> 0:13:11.560 the US than in Europe. Yet, is that that more 0:13:11.720 --> 0:13:16.680 marginal luxury consumer, the consumer that perhaps spent stimulus checks 0:13:16.760 --> 0:13:20.400 on a new Hamburg or a new pair of sneakers 0:13:20.440 --> 0:13:26.679 in one they haven't been so exuberant this year and 0:13:26.760 --> 0:13:29.320 they are just starting to rain in their spending. So 0:13:29.400 --> 0:13:32.000 I would say that is a bit of a warning 0:13:32.080 --> 0:13:35.800 sign for the luxury industry as we go into next year. 0:13:36.080 --> 0:13:39.000 What about this idea of you know, the cheap pound 0:13:39.080 --> 0:13:41.640 has been a big advantage for people who are traveling, 0:13:41.679 --> 0:13:44.520 particularly from the US into the UK and looking to 0:13:44.559 --> 0:13:47.760 go shopping. Is that playing out in the boost for 0:13:48.000 --> 0:13:51.720 UK luxury brands. It's more playing out in Europe because 0:13:51.920 --> 0:13:55.240 they still have the tax free benefit that we no 0:13:55.360 --> 0:13:59.480 longer have in London, and brands have been saying Burbery 0:13:59.520 --> 0:14:02.400 said la this week that they are not seeing so 0:14:02.559 --> 0:14:05.880 many tourists coming to London. They're going to Paris or 0:14:05.920 --> 0:14:10.040 milamb because of that, you know, not having that tax breaks. 0:14:10.080 --> 0:14:13.800 So the the luxury industry, the Bridge luxury industry is 0:14:13.960 --> 0:14:17.080 lobbying to try and find a way forward so that 0:14:17.120 --> 0:14:21.920 they can encourage more overseas tourists to come to the 0:14:22.040 --> 0:14:25.040 UK and get that benefit, of course, because I mean 0:14:25.080 --> 0:14:28.400 we've been reporting and various parts of Bloomberg about the 0:14:28.760 --> 0:14:31.000 all of the things that Americans are able to buy 0:14:31.080 --> 0:14:33.760 more easily, property being one of them in the UK 0:14:33.960 --> 0:14:37.480 as well. Cominian columnist Andrea Felstead and our Pursuits reporter 0:14:37.560 --> 0:14:40.160 Sara Appaport. Thank you so much to both of you 0:14:40.240 --> 0:14:42.920 for your insights. I'm Stephen, Caroline, London. You can catch 0:14:43.040 --> 0:14:45.800 us every weekday morning here for Bloomberg Daybreak Europe, beginning 0:14:45.800 --> 0:14:48.480 at six am in London and one am on wall Streece. 0:14:48.640 --> 0:14:51.280 John Nathan Stephen, thanks a lot. Here just to hit 0:14:51.320 --> 0:14:55.680 on Bloomberg Daybreak, weekend consumers spending in China. I'm John Tucker. 0:14:55.800 --> 0:15:13.800 This is Bloomberg broadcasting live from the Bloomberg Interactive Broker 0:15:13.920 --> 0:15:17.320 Studio in New York. Bloomberg Even three oh to Washington, 0:15:17.400 --> 0:15:21.440 d C, Bloomberg to Boston, Bloomberg one O six one 0:15:21.640 --> 0:15:25.760 to San Francisco, Bloomberg to the Country, Sirius XM Cho 0:15:25.840 --> 0:15:29.120 one nine to London d A B Digital Radio, and 0:15:29.160 --> 0:15:32.520 around the globe. The Bloomberg Business Act and Bloomberg Radio 0:15:32.600 --> 0:15:42.480 dot Com. This is Bloomberg day Break Weekend. I'm John 0:15:42.520 --> 0:15:44.560 Tucker in New York with your global look ahead of 0:15:44.600 --> 0:15:47.280 the top stories for investors in the coming week. Holiday 0:15:47.280 --> 0:15:49.720 spending is in the spotlight this week as we head 0:15:49.720 --> 0:15:54.400 into the winter holiday season. Spending also in focus in China, Amoral. 0:15:54.480 --> 0:15:57.520 Let's go to Bloomberg day Break Asia host Doug Chrisner. 0:15:57.840 --> 0:16:00.400 John with a holiday season now underway in the US, 0:16:00.480 --> 0:16:03.800 the focus for markets is on the strength of the consumer. 0:16:03.840 --> 0:16:07.280 We have seen exceptional resilience so far in spite of 0:16:07.280 --> 0:16:12.160 stubbornly high inflation, although given uncertainty around the outlook, the 0:16:12.280 --> 0:16:15.640 risk is overcautious buying now. It was interesting that the 0:16:15.680 --> 0:16:19.080 South China Morning Post has already reported on a decline 0:16:19.200 --> 0:16:22.920 in Chinese exports to the U S. What does that 0:16:22.960 --> 0:16:26.920 speak to Meantime in China, domestic consumer spending has already 0:16:26.920 --> 0:16:31.000 been slowing. The primary factor, obviously has been beijing strict 0:16:31.240 --> 0:16:33.720 zero COVID policy. We want to take a closer look 0:16:33.760 --> 0:16:36.720 now at the outlook for Chinese consumers as we approached 0:16:36.720 --> 0:16:38.240 the end of the year, and we are joined by 0:16:38.360 --> 0:16:42.680 end to Current Bloomberg's Chief Asia Economics correspondent, and thank 0:16:42.680 --> 0:16:45.480 you for joining us. One of the things that struck 0:16:45.520 --> 0:16:48.400 me was the retail sales data for the month of 0:16:48.400 --> 0:16:52.000 October negative seven tenths of one percent, which was really 0:16:52.680 --> 0:16:54.560 much weaker than the market was looking for. I think 0:16:54.600 --> 0:16:57.320 the forecast was for a gain of one point two 0:16:58.080 --> 0:17:00.680 What is happening underneath the hood here in the Chinese 0:17:00.720 --> 0:17:03.800 economy where the consumer is concerned. It's a pretty downbeat 0:17:03.880 --> 0:17:06.679 story for the Chinese consumer. Two things are going on 0:17:06.720 --> 0:17:09.880 in China. On the one side, China is going through 0:17:09.920 --> 0:17:13.679 a big real estate slump. House prices continue to fall 0:17:14.119 --> 0:17:17.200 and demand for new homes continues to weaken. That's obviously 0:17:17.240 --> 0:17:21.720 eroding everybody's net worth and sense of you know, upbeat 0:17:22.119 --> 0:17:24.000 or or well being, so to speak. So that's one 0:17:24.000 --> 0:17:26.080 side of what's going on. The other side of what's 0:17:26.119 --> 0:17:29.040 going on, which we all know, is the very aggressive 0:17:29.080 --> 0:17:33.320 measures to contain COVID which continue to roll around the 0:17:33.400 --> 0:17:37.240 country in either the form of restrictions or mass testing 0:17:37.680 --> 0:17:39.720 or maybe even in some cases of broader lockdown. So 0:17:39.760 --> 0:17:41.960 all of that combined is really weighing on the consumer. 0:17:42.000 --> 0:17:45.119 And you mentioned the October consumer data. October is a 0:17:45.119 --> 0:17:47.000 month in the year when there's a big week long 0:17:47.040 --> 0:17:49.399 holiday in China, It's meant to be a month of 0:17:49.440 --> 0:17:51.960 the year when there's big spending on you know, on 0:17:52.000 --> 0:17:55.560 tourism related and travel related activities. That didn't happen. It 0:17:55.680 --> 0:17:59.600 went into negative territory. There is broad based weakness across 0:17:59.680 --> 0:18:02.520 all of the main gauges of retail spending, from household 0:18:02.600 --> 0:18:05.359 goods through to eating out and the like, and there's 0:18:05.400 --> 0:18:08.359 no sign of that turning around. And that's a critical point. 0:18:08.359 --> 0:18:11.160 The consumer, which had become the engine of China's economy 0:18:11.359 --> 0:18:14.240 in recent years, remains stuck in the indulgence. Do we 0:18:14.359 --> 0:18:17.800 know or can we delineate between let's say, sales at 0:18:17.840 --> 0:18:21.919 physical stores versus e commerce. Is there any way to 0:18:22.040 --> 0:18:26.640 understand how consumer behavior has adjusted relative to what we're 0:18:26.640 --> 0:18:29.760 talking about, particularly as it relates to COVID. There is 0:18:29.840 --> 0:18:33.480 evidence of declining even declining online demand in terms of 0:18:33.520 --> 0:18:36.560 the online annual shopping brands is dog There's no doubt 0:18:36.560 --> 0:18:38.320 about it. But I should go back one step to 0:18:38.400 --> 0:18:41.800 one of your points that remember China's economy. In China's 0:18:41.800 --> 0:18:46.119 the consumers had it pretty good in one because the 0:18:46.200 --> 0:18:49.880 disease the disease was controlled pretty well and the level 0:18:49.920 --> 0:18:52.159 of disruption was nothing like what's happening this year, and 0:18:52.160 --> 0:18:54.760 now the consumer remains subdued overall. You are right, but 0:18:55.040 --> 0:18:58.200 the economy had a pretty good two has been the 0:18:58.200 --> 0:19:01.360 big game changer because the arrival of om CON has 0:19:01.400 --> 0:19:04.640 made it's so much more difficult control, and by extension, 0:19:04.680 --> 0:19:07.800 that's impeding on people's daily working on recreational lives in 0:19:07.800 --> 0:19:10.479 ways that hasn't before. So school closures have become much 0:19:10.520 --> 0:19:13.840 more routine, daily testing requirems have become much more routine. 0:19:14.160 --> 0:19:16.200 All of that is of course impacting what people are 0:19:16.200 --> 0:19:19.240 spending and had their spending in that result of the 0:19:19.280 --> 0:19:23.359 consumption story has is very much indulgence as a growth driver. 0:19:23.760 --> 0:19:25.640 You and I were talking before we went to air 0:19:25.760 --> 0:19:29.240 about the difficulty and measuring a consumer sentiment in China. 0:19:29.320 --> 0:19:34.080 There are no surveys for that kind of sentiment per se, 0:19:34.600 --> 0:19:37.800 but I would imagine that employment, to the extent that 0:19:37.840 --> 0:19:40.560 you are employed and are earning an income, that's going 0:19:40.600 --> 0:19:44.040 to have a very positive correlation. I know that youth 0:19:44.080 --> 0:19:49.000 employment though in China is what running right now, so demographically, 0:19:49.080 --> 0:19:53.240 I think that there are probably pockets of the economy 0:19:53.240 --> 0:19:57.160 in terms of demographics where sentiment is maybe a little 0:19:57.200 --> 0:19:59.520 weaker than another's right, it is it's it is tough 0:19:59.560 --> 0:20:02.760 to send tally gage sentiments in China, both because of 0:20:02.800 --> 0:20:05.240 the political system and of course an economy of that 0:20:05.359 --> 0:20:08.560 size dog. But we do get snap shuts off, especially 0:20:08.600 --> 0:20:10.719 in social media. It is often the case that there 0:20:10.760 --> 0:20:14.800 can be a you know, a series of outrage amongst 0:20:14.800 --> 0:20:17.719 residents over some COVID related policy that gets censored. That's 0:20:17.720 --> 0:20:20.360 an indication that people are unhappy. There was, of course, 0:20:20.400 --> 0:20:23.800 the mortgage boycott earlier this year because of an unhappiness 0:20:23.800 --> 0:20:26.400 forwards government policy. Those are all indications there have been 0:20:26.920 --> 0:20:29.120 There have been ways a sense that the Chinese consumer 0:20:29.200 --> 0:20:31.440 is not happy at the moment. We do know that, 0:20:31.880 --> 0:20:34.600 and I think though going forward a lot will depend 0:20:34.640 --> 0:20:37.520 on just where these government policy pivots do go. And 0:20:37.680 --> 0:20:40.159 always a pleasure. Thanks for making time to chat with 0:20:40.240 --> 0:20:43.919 us and the current Bloomberg's Chief Asia Economics correspondent, I'm 0:20:44.000 --> 0:20:46.200 that prisoner in New York. You can join us weekdays 0:20:46.200 --> 0:20:49.160 for Bloomberg Daybreak Asia beginning at seven am in Hong 0:20:49.240 --> 0:20:53.040 Kong six pm on Wall Street, John Doug thanks a lot, 0:20:53.240 --> 0:20:55.760 and just they had on Bloomberg Daybreak Weekend. Women on 0:20:55.800 --> 0:20:59.119 the US political stage as HOW Speaker Nancy Pelosi steps 0:20:59.160 --> 0:21:02.240 down from the lead ship position. I'm John Tucker, and 0:21:02.440 --> 0:21:15.359 this is Bloomberg. This is Bloomberg Daybreak Weekend, our global 0:21:15.359 --> 0:21:17.439 look ahead of the top stories for investors in the 0:21:17.480 --> 0:21:20.679 coming week. I'm John Tucker in New York. Women in 0:21:20.800 --> 0:21:24.320 US politics the focus as HOW Speaker Nancy Pelosi's legacy 0:21:24.440 --> 0:21:27.520 is remembered as she prepares to hand the reins over 0:21:27.600 --> 0:21:29.960 as the House Speaker. And for more, let's head to 0:21:30.000 --> 0:21:36.040 our Bloomberg newsroom in Washington and Amy Morris, Amy, thank you, John. 0:21:36.080 --> 0:21:39.280 Nancy Pelosi has been HOW Speaker for almost two decades, 0:21:39.320 --> 0:21:41.960 and as the first female Speaker of the House, she's 0:21:42.040 --> 0:21:45.160 open doors for more women. Joining us now to talk 0:21:45.200 --> 0:21:48.680 about Pelosi in her unique style of leadership. Bloomberg News 0:21:48.680 --> 0:21:51.480 Congressional reporter at Laura let Van. Laura want to thank 0:21:51.520 --> 0:21:54.040 you for joining us. Thanks for having me now. I 0:21:54.080 --> 0:21:58.960 think what's important to establish is your relationship with Nancy 0:21:59.000 --> 0:22:03.600 Pelosi is that you've covered her for years. Um, were 0:22:03.640 --> 0:22:06.280 you at all surprised when she announced that she would 0:22:06.320 --> 0:22:08.880 not be seeking the leadership. I have been thinking she 0:22:08.960 --> 0:22:11.480 would make that announcement because she had promised a couple 0:22:11.480 --> 0:22:15.040 of years ago to get the votes to become speaker again, 0:22:15.080 --> 0:22:18.520 that she would be prepared to clear the path for others, 0:22:18.840 --> 0:22:22.560