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

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Speaker 1: DAYBAQ podcast, available every morning on Apple, Spotify or wherever

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Speaker 1: you listen. It's Monday, the twenty fifth of November in London.

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Speaker 1: I'm Caroline Hepka.

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Speaker 2: And I'm Stephen Carroll. Coming up today, The CBI says

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Speaker 2: half of all UK firms are planning job cuts after

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Speaker 2: last month's budget tax hikes.

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Speaker 1: The UK government is considering clawing back tax breaks from

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Speaker 1: fund managers who fail to invest enough domestically.

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Speaker 2: Plus, Germany's politics may be fractious and its economy week,

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Speaker 2: but bond investors have some good news.

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Speaker 1: Let's start with a round up of our top stories.

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Speaker 2: Almost half of firms in the UK are said to

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Speaker 2: be in damage control and preparing to slash jobs. That's

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Speaker 2: according to a survey by the Confederation of British Industry,

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Speaker 2: which says the moves are in response to the tax

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Speaker 2: rises announced in last month's budget. Bloomberg's Tiba Adabaio has

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Speaker 2: the story Half.

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Speaker 3: Of all British businesses are planning to trim their workforces

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Speaker 3: and sixty two percent say they'll look to hire fewer

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Speaker 3: people in the future. Those were some of the findings

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Speaker 3: of a recent survey by the UK's most prominent business

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Speaker 3: lobby group. The news comes after Chancellor Rachel Reeves increased

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Speaker 3: taxes by more than forty billion pounds last month, most

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Speaker 3: of which will come from changes to National Insurance, a

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Speaker 3: payroll levy. The group's CEO, Rain Newton Smith is expected

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Speaker 3: to blame the budget for waning business sentiment during a

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Speaker 3: speech at the CBI annual conference later as today. Alongside

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Speaker 3: job cuts, around six to ten businesses predicted that the

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Speaker 3: budget wouldn't increase the country's investment appeal. That's despite Rachel

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Speaker 3: Reeves's claims her plan will get the nation's finances back

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Speaker 3: on track. In London, Tea at a bio Bloomberg.

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Speaker 1: Radio staying with the UK Now where the government is

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Speaker 1: considering clawing back pension tax breaks from asset managers who

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Speaker 1: failed to invest enough domestically. That's according to the head

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Speaker 1: of the British Business who warned the measure could be

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Speaker 1: necessary as the government pursues a key growth initiative. Louis Taylor,

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Speaker 1: effectively a government official as CEO of the state owned lender,

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Speaker 1: added that he did not endorse the idea, noting that

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Speaker 1: the industry prefers an Australian style tax relief system to

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Speaker 1: incentivize investment. The government wants pension funds to commit at

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Speaker 1: least five percent of their assets to the UK and

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Speaker 1: is considering a disclosure regime to encourage voluntary investment, but

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Speaker 1: last week the Pensions Minister Emma Reynolds refused to rule

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Speaker 1: out maudraconian measures.

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Speaker 2: UNI Credit has launched a takeover bid for its domestic

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Speaker 2: rival Banco BPM. The move comes as the Landers' CEO,

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Speaker 2: Andrea Orcelle, is also considering an acquisition of Germany based

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Speaker 2: Commerce Bank after buying a large stake in its unique

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Speaker 2: credits offer. As an all shares one it's proposing zero

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Speaker 2: point one seven five newly issued shares for each one

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Speaker 2: from BP.

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Speaker 1: The selection of Scott Percent as the next US Treasury

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Speaker 1: Secretary his fuel d a rallying currencies around the world

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Speaker 1: against the US dollar. The greenback fell by zero point

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Speaker 1: six percent on Monday, according to one gauge, with the

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Speaker 1: yen and Europe among the biggest gainers. The moves underscored

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Speaker 1: the sense of relief amongst traders who believe the choice

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Speaker 1: of a Wall Street veteran may take some of the

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Speaker 1: sting out of Trump's America First agenda. Hugh Chung is

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Speaker 1: chief Investment advisory Officer at Endowas.

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Speaker 4: Is viewed as a pragmatist when it comes to policy.

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Speaker 4: I mean, in the past we've seen appointments of people

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Speaker 4: from the industry and banks such as Henry Parson and

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Speaker 4: Robert Rubin as well, so I think the market expectation

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Speaker 4: is for him to be more market friendly.

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Speaker 1: Hugh Chung's view is supported by market participants surveyed by Bloomberg.

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Speaker 1: Following Percent's appointment, The traders think the fund manager will

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Speaker 1: take a more phased approach to tariffs while also attempting

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Speaker 1: to rein in the US budget de sid.

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Speaker 2: Apple CEO Tim Cook is visiting China today is company's

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Speaker 2: brace for President elect Donald Trump's threat to hike tariffs

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Speaker 2: on the country's goods. Cook is attending a suppliers conference

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Speaker 2: in Beijing, where Chinese President excuse Chinese Premier Lee Kiang

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Speaker 2: is expected to meet top corporate executives. The Apple CEO

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Speaker 2: was in the capital just last month when he promised

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Speaker 2: to keep investing in the country. The latest visit comes

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Speaker 2: as in video Boss Jensen Huang also weighed in on

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Speaker 2: China's economic importance while accepting an honorary degree from Hong

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Speaker 2: Kong University.

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Speaker 5: And Video has also benefited from being in this region.

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Speaker 5: In China, we came over twenty five years ago. Nvidia

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Speaker 5: designce centers in Hong Kong, Pudong, Beijing, Shenzhen have many

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Speaker 5: proud hkust alums and longtime colleagues.

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Speaker 6: Who have helped me build Nvidio.

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Speaker 5: They've also helped build China's technology ecosystem from the very beginning.

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Speaker 5: We've had the benefit and the great joy privilege of

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Speaker 5: watching the amazing technology industry form in China.

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Speaker 2: Well I also acknowledged China's contributions to AI and praised

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Speaker 2: open research as a form of global cooperation.

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Speaker 1: Iran reportedly plans to hold talks about its nuclear program

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Speaker 1: this week with the UK, France, and Germany, according to

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Speaker 1: Japan's Kyodo news agency, citing Iranian diplomatic sources. The talks

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Speaker 1: will also touch on European sanctions on the country's airline

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Speaker 1: and shipping companies. Last week, Tehran said that it would

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Speaker 1: ramp up its nuclear fuel making capacity after it was

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Speaker 1: censored by the UN Atomic watchdog. All Eyes are now

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Speaker 1: on the incoming Trump administration to see if the President

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Speaker 1: elect plans to revive his so called maximum pressure policy

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Speaker 1: against Iran.

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Speaker 2: In the UK, Store and Burt is expected to cause

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Speaker 2: continued flooding and travel disruption after torrential downpours and for

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Speaker 2: weather related deaths over the weekend. A major incident has

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Speaker 2: been declared in Wales. Welsh First Minister Eleonard Morgan says

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Speaker 2: it's been a difficult weekend for many.

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Speaker 7: This is the second time that many of those have

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Speaker 7: suffered as a result of the storm. There's been huge

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Speaker 7: investments since the last storm hits, so we've managed to

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Speaker 7: protect lots more properties, but obviously this is absolutely devastating.

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Speaker 2: Just before Christmas, helland Morgan speaking there after more than

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Speaker 2: eighty percent of November's average monthly rainfall fell in just

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Speaker 2: forty eight hours across the UK.

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Speaker 1: Those are our top stories for you on the markets

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Speaker 1: this morning. Markets seem to be cheering Trump's Treasury secretary

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Speaker 1: pick the S and P five rounded. Even if futures

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Speaker 1: currently up four tenths of one percent, euro Stox fifty

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Speaker 1: futures also gaining seven tenths of one percent, The dollar

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Speaker 1: is falling back on the Bloomberg Dollar Spot Index some

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Speaker 1: four tenths of one percent lower US Treasury yield to

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Speaker 1: fall and five basis points, so Treasury is rallying and

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Speaker 1: risk sentiment in Asia appears to be positive, So the

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Speaker 1: Nicke two two five up by one point four percent,

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Speaker 1: CIAS Pacific Index up by nine tenths of one percent.

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Speaker 1: I'd also point to a couple of other markets. Bitcoin

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Speaker 1: rebounding after the loss that we saw over the weekend,

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Speaker 1: is up by one point three percent ninety eight two

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Speaker 1: hundred and ninety dollars. This follows what happened last week

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Speaker 1: for European markets. Just a reminder of Friday, of course,

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Speaker 1: your stock six hundred close up by one point two percent,

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Speaker 1: but a fourth week of losses for European stocks last week.

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Speaker 2: Unique Credit has launched a takeover bid for its domestic

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Speaker 2: rival Banco BPM. The move comes as the Landers CEO

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Speaker 2: Andrea Orchell is also considering an acquisition of Germany based

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Speaker 2: Commerce Bank after buying a large stake in its Unique

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Speaker 2: Credits offer as an all shares one It's proposing zero

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Speaker 2: point one seven five newly issued shares for each one

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Speaker 2: from BPM.

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Speaker 1: The selection of Scott percent as the next US Treasury Secretary,

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Speaker 1: has fueled a rallying currencies around the world against the

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Speaker 1: US dollar. Bring backfell by zero point six percent on Monday,

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Speaker 1: according to one gauge, with the yen and Europe among

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Speaker 1: the biggest gainers. The moves underscored the sense of relief

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Speaker 1: amongst traders who believe the choice of a Wall Street

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Speaker 1: veteran may take some of the sting out of Trump's

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Speaker 1: America First agenda. Hugh Chung is chief Investment advisory Officer

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Speaker 1: at Endowas.

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Speaker 4: Is viewed as a pragmatist when it comes to policy.

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Speaker 4: I mean, in the past we've seen appointments of people

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Speaker 4: from the industry and banks such as Henry Paarson and

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Speaker 4: Robert Rubin as well, so I think the market expectation

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Speaker 4: is for him to be more market friendly.

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Speaker 1: Hugh Chung's view is supported by market participants surveyed by

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Speaker 1: Bloomberg Following Percent's appointment. The traders think the fund manager

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Speaker 1: will take a more phased approach to tariffs while also

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Speaker 1: attempting to brain in the US budget deficit.

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Speaker 2: Apple CEO Tim Cook is visiting China today as companies

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Speaker 2: brace for President elect Donald Trump's threat to hike tariffs

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Speaker 2: on the country's goods. Cook is attending a suppliers conference

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Speaker 2: in Beijing, where Chinese President Ecusny Chinese Premier Lee Kiang

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Speaker 2: is expected to meet top corporate executives. The Apple CEO

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Speaker 2: was in the capital just last month when he promised

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Speaker 2: to keep investing in the country. The latest physics comes

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Speaker 2: as in video. Boss Jensen Huang also weighed in on

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Speaker 2: China's economic importance while accepting an honorary degree from Hong

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Speaker 2: Kong University.

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Speaker 5: And Vidia has also benefited from being in this region

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Speaker 5: in China.

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Speaker 6: We came over twenty five years ago.

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Speaker 5: Nvidia design centers in Hong Kong, Pudong, Beijing, Shenzhen have

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Speaker 5: many proud hkust alums and longtime colleagues.

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Speaker 6: Who have helped me build Nvidia.

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Speaker 5: They've also helped build China's technology ecosystem from the very beginning.

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Speaker 5: We've had the benefit and the great joy and privilege

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Speaker 5: of watching the amazing technology industry form in China.

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Speaker 2: Well I also acknowledged China's contributions to AI and praised

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Speaker 2: open research as a form of global cooperation.

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Speaker 1: Iran reportedly plans to hold talks about its nuclear program

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Speaker 1: this week with the UK, France and Germany. According to

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Speaker 1: Japan's Kyodo news agency, citing Iranian diplomatic sources, the talks

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Speaker 1: will also touch on European sanctions on the country's airline

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Speaker 1: and shipping companies. Last week, Tehran said that it would

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Speaker 1: ramp up its nuclear fuel making capacity after it was

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Speaker 1: censored by the UN Atomic Watchdog. All eyes are now

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Speaker 1: on the incoming Trump administration to see if the President

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Speaker 1: elect plans to revive his so called maximum pressure policy

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Speaker 1: against Iran.

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Speaker 2: In the UK, storem birth is expected to cause continued

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Speaker 2: flooding and travel disruption after torrential downpours, and for weather

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Speaker 2: related deaths over the weekend. A major incident has been

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Speaker 2: declared in Wales. Welsh First Minister Eleonard Morgan says it's

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Speaker 2: been a difficult weekend for many.

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Speaker 7: This is the second time that many of those have

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Speaker 7: suffered as a result of the storm. There's been huge

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Speaker 7: investments since the last storm hits, so we've managed to

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Speaker 7: protect lots more properties, but obviously this is absolutely devastating.

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Speaker 2: Just before Christmas, Hellod Morgan speaking there after, more than

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Speaker 2: eighty percent of November's average monthly rainfall fell in just

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Speaker 2: forty eight hours across the UK.

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Speaker 1: Those are our top stories for you on the markets

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Speaker 1: this morning. Markets seem to be cheering Trump's Treasury secretary

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Speaker 1: pick the S and P five unded, even if future

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Speaker 1: is currently up four tenths of one percent. Euro Stox

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Speaker 1: fifty futures also gaining seven tenths of one percent. The

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Speaker 1: dollar is falling back on the Bloomberg Dollar Spot Index,

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Speaker 1: some four tenths of one percent lower US Treasury yield

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Speaker 1: to fall and five basis points, so Treasury is rallying,

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Speaker 1: and risk sentiment in Asia appears to be positive, so

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Speaker 1: the NICKEK two two five up by one point four percent,

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Speaker 1: Msciaged Pacific Index up by nine tenths of one percent.

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Speaker 1: I'd also point to a couple of other markets. Bitcoin

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Speaker 1: rebounding after the loss that we saw over the weekend,

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Speaker 1: is up by one point three percent ninety eight two

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Speaker 1: hundred and ninety dollars. This follows what happened last week

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Speaker 1: for European markets. Just a reminder of Friday, of course,

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Speaker 1: your stock six hundred close up by one point two percent,

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Speaker 1: but a fourth week of losses for European stocks last week.

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Speaker 6: In a moment, we'll bring you.

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Speaker 2: More on the warning of job carts from the UK's

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Speaker 2: most influential business lobby, plus why investors think Germany should

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Speaker 2: borrow hundreds of billions of euros more to invest in

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Speaker 2: its economy. But first, one of the story that caught

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Speaker 2: our i this morning, and in case you're looking for

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Speaker 2: a further educational opportunity, you could try the Rolls Royce

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Speaker 2: School for Chauffeurs.

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Speaker 1: I love this story, It's so fun. It's our colleague

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Speaker 1: Canna Elliott, who joined the training course herself. It was

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Speaker 1: in Las Vegas. It apparently teaches chauffers how to open

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Speaker 1: doors properly, how to load luggage, how to drive with

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Speaker 1: elegance and precisions. That's very different to my morning commute.

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Speaker 2: Well exactly. It includes important tips like making sure that

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Speaker 2: the bags are loaded into the car before the passengers arrive.

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Speaker 2: You always lift and not drag, so you don't bring

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Speaker 2: any dirt with you into the cars. As well, never

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Speaker 2: ask a passenger how was your flight, because it encourages

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Speaker 2: them essentially to lie to you because nobody has a

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Speaker 2: good flight. And that you also should know is that

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Speaker 2: you chill Vintage and non vnted champagnes to different temperatures

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Speaker 2: and you can adjust your rolls Royce Mini fridge to

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Speaker 2: be able to cater for that.

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Speaker 1: I love that well. It is sort of two different worlds,

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Speaker 1: isn't it, Because you've got the idea of autonomous driving

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Speaker 1: where you don't drive a tool, and then this very

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Speaker 1: very kind of personalized, probably rather expensive service.

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Speaker 2: It's a fascinating read for all the tips and tricks

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Speaker 2: that come with that job. As a well worth read

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Speaker 2: on Bloomberg dot com or on the terminal. Let's bring

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Speaker 2: you more in e though, on that warning from the

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Speaker 2: CBI that half of UK firms are planning to cut

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Speaker 2: jobs after the tax sikes that were announced in last

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Speaker 2: month's budget, Our UK correspondent Lizzie Burden is here with more. Lizzie,

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Speaker 2: this seems like a pretty stark warning from the country's

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Speaker 2: most influential business lobby group. What are they saying?

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Speaker 8: Yeah?

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Speaker 9: And what a change from pre election and pre budget

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Speaker 9: when you know, it seemed obvious that Labor was the

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Speaker 9: party of Business. They'd wooed bosses with the smoked salmon

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Speaker 9: and scrambled eggs offensive. But now the CBI is saying

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Speaker 9: all of these tax rises in the budget forty billion

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Speaker 9: pounds of them, which of course were aimed at business

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Speaker 9: and the wealthy, means that businesses have got to be

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Speaker 9: in damage control. So as you say, they say about

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Speaker 9: half are planning to trim their workforces. Even more than that,

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Speaker 9: sixty two percent say that they're planning to pull back hiring.

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Speaker 9: And this is why Rain Newton Smith, the CBI CEO,

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Speaker 9: is going to say at their conference today, tax rises

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Speaker 9: like this employer national insurance rise must never again be

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Speaker 9: done to business. So Steve and I do wonder whether

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Speaker 9: this is actually preempting a potential further fiscal event if

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Speaker 9: one is to come in the spring. She's trying to

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Speaker 9: fend off more taxes if the Chancellor has to come

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Speaker 9: back again. But I also wonder whether it's partly on

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Speaker 9: lobby groups for not taking on labor bravely enough pre budget.

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Speaker 9: The CBI says that these tax rises were expected, but

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Speaker 9: it was the scale of them that was the real surprise.

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Speaker 8: Here.

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Speaker 9: Now, other things that they're going to be asking for

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Speaker 9: at this conference today include planning reforms to boost development,

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Speaker 9: a simpler tax system, better tech adoption, and interestingly also

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Speaker 9: they want the government to make occupational health care tax

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Speaker 9: free because they say that that's going to stop people

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Speaker 9: dropping out of the workforce.

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Speaker 1: Yeah, how big a worry will that continue to be?

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Speaker 1: And what does that mean that occupational health care that

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Speaker 1: it should become tax free.

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Speaker 9: Well, so they say that thirty four thousand people dropping

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Speaker 9: out of the workforce could be prevented if you took

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Speaker 9: this measure. And interestingly, the Prime Minister said in an

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Speaker 9: op ed over the weekend that the government's going to

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Speaker 9: lay out radical reforms on social spending this week and

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Speaker 9: it's for the same reason to get people back into

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Speaker 9: the workforce, which of course is important because if you

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Speaker 9: look at the recent economic data for the first few

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Speaker 9: months of laboring office, you can see the economy he's

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Speaker 9: been stagnating. Retail sales have been falling, so he's trying

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Speaker 9: to get especially young people back into employment or at

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Speaker 9: least into education or training.

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Speaker 2: We've also been hearing from the head of the British

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Speaker 2: Business Bank warning that the government could go further to

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Speaker 2: encourage funds to invest more in UK assets.

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Speaker 9: Yeah, so you'll remember in the Chancellor's Mansion House speech,

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Speaker 9: Rachel Reeves said that pension funds should club together to

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Speaker 9: create these mega funds bigger pools for investment. But one

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Speaker 9: of the big unanswered questions was how she'd drive that

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Speaker 9: money into UK companies. And when I spoke to her,

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Speaker 9: she said she wasn't looking at mandating asset managers to

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Speaker 9: invest in UKPLC. That's the big stick here, right. I

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Speaker 9: asked her, are you going to give tax breaks for

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Speaker 9: funds that do invest in the UK like they do

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Speaker 9: in Australia and she said they already get tax breaks.

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Speaker 9: But what's interesting here is Louis Taylor, who's effectively a

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Speaker 9: government official as the CEO of the British Business Bank,

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Speaker 9: which is a so own bank. He said the Treasury

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Speaker 9: could recoup some of the tax benefits already given, so

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Speaker 9: I don't know whether you want to see that as

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Speaker 9: a smaller stick or a carrot, A small a carrot.

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Speaker 9: But the Pensions Worker Pension of Secretary Emma Reynolds hasn't

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Speaker 9: ruled this out, so we'll have to see whether this

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Speaker 9: how this plays.

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Speaker 1: Up, Okay, Lizzie, thank you so much for that. Bloomberg's

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Speaker 1: UK corresponded.

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Speaker 2: Lizzie Burden to Germany next, where calls are growing for

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Speaker 2: the next government to loosen its purse strings and spend

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Speaker 2: more on investment if it chooses to. There's a market

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Speaker 2: hungary to buy more of its debt. Our FX and

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Speaker 2: rates reporter Alice Ledhill has been writing about this and

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Speaker 2: she joins us this.

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Speaker 6: Morning for more.

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Speaker 2: Alice, why do investors think Germany should issue more debt?

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Speaker 8: Mornning? So there's no doubt about it. Germany finds itself

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Speaker 8: in a pretty tough book. So the economy has these

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Speaker 8: big structural problems. It's been flirting with recession through this year.

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Speaker 8: It looks economists think it will gain recession this winter.

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Speaker 8: Now that contrast to some of Europe's other economy like

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Speaker 8: Italy and Spain, which have actually emerged from the COVID

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Speaker 8: years pretty strongly. And this is a real change for

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Speaker 8: the area. So Germany as its biggest economy historically, it's

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Speaker 8: been this economic powerhouse, and now it's frequently held up

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Speaker 8: as the fit burn of Europe. And this is where

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Speaker 8: the debt issue comes in. So Germany has a so

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Speaker 8: called debt break which has enshrined in the constitution and

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Speaker 8: put some limit on how much debt Germany can issue.

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Speaker 8: And increasingly investors, economists, and some German politicians are saying

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Speaker 8: we're being held back by our self imposed rules on debt.

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Speaker 8: We need to be able to borrow more that we

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Speaker 8: can invest in the economy and make long lasting structural

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Speaker 8: changes that can boost growth.

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Speaker 1: Yeah. Absolutely, But then surely do bond investors not prefer

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Speaker 1: countries to actually issue less debt rather than more debt.

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Speaker 8: Yeah, it's a good question, and I think it all

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Speaker 8: depends on the starting point. So yeah, a lot of

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Speaker 8: countries have very large debt piles that are increasingly a

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Speaker 8: source of worry. So I've put France in that camp,

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Speaker 8: the UK, even the US as well. Germany, however, is

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Speaker 8: a bit of an anomaly, so culturally and politically there's

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Speaker 8: long been opposition to the country issuing too much debt,

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Speaker 8: and that means it's got a pretty low debt to

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Speaker 8: GDP or sort of debt to output ratio of about

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Speaker 8: sixty percent in just the comparison the UK is about

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Speaker 8: one hundred percent, in France at about one hundred and twelve.

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Speaker 8: And so Germany enjoyed from the lowest borrowing cough in Europe,

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Speaker 8: if not the world, And that's the key point. I think,

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Speaker 8: So Germany essentially has the capacity to do more debt

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Speaker 8: if itchis is how.

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Speaker 2: Likely is it though, that Germany will actually start to

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Speaker 2: issue this debt because of course there's an election campaign

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Speaker 2: on at the moment, so it is an issue that

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Speaker 2: could be.

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Speaker 6: Up for debate.

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Speaker 8: Yeah, for sure, I mean, and it's very much central

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Speaker 8: I think to see this election now that does seem

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Speaker 8: to be a bit of a thawing of sentiments in Germany,

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Speaker 8: that it does remain a highly divisive issue. So in fact,

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Speaker 8: the reform of the debt break was actually at the

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Speaker 8: heart of the recent collapse of the coalition government. So

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Speaker 8: Chancellor and Olas Schultz ended up firing his finance minister,

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Speaker 8: Christian Linda, who's known for being a strong proponent or

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Speaker 8: advocate of keeping the debt break. Now, Schultz as well

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Speaker 8: as Friedrich Mertz, who's one of his main contenders for

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Speaker 8: the chancellorship in the elections, have signor they're both open

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Speaker 8: to some kind of reform. However, polls show that a

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Speaker 8: slim majority of Germany's population is against changing the rules,

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Speaker 8: and of course any change in parliament would require two

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Speaker 8: thirds of politicians to vote in favor of it, which

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Speaker 8: is by no means should this.

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