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Speaker 1: This is Bloomberg day Break Weekend, our global look at

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Speaker 1: the top stories in the coming week from our Daybreak

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Speaker 1: anchors all around the world, and straight ahead on the

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Speaker 1: program gearing up for a highly anticipated Bedrooll Reserve decision.

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Speaker 1: I'm Tom Busby in New York.

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Speaker 2: I'm Brian Curtis in Hong Kong. We check in with

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Speaker 2: Bloomberg's Kathleen Hayes on the boj Will they or won't They?

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Speaker 3: I'm Caroline Hepga in London, where we've been speaking to

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Speaker 3: Nigel Fouers about the decision by coops to close his

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Speaker 3: bank accounts.

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Speaker 4: I'm Kaylee Lyons in Washington, where the Biden family is

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Speaker 4: brison for Hunter Biden to appear in a Delaware court.

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Speaker 5: That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg Eleve,

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Speaker 5: the three own New York, Bloomberg ninety nine to one, Washington, DC,

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Speaker 5: Bloomberg one O six one, Boston, Bloomberg nine sixty, San Francisco,

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Speaker 5: DAB Digital Radio, London, Sirius XM one nineteen and around

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Speaker 5: the world on Bloomberg Radio dot com and via the

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Speaker 5: Bloomberg Business app.

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Speaker 1: Good day to you. I'm Tom Busby, and we begin

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Speaker 1: today's program with the FEDS big policy meeting coming up

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Speaker 1: this week, which Bloomberg Radio will be covering live. Now

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Speaker 1: joining me now to talk about what could be a

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Speaker 1: pivotal decision from the Central Bank. Bloomberg's Global Economics and

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Speaker 1: Policy editor Michael mckeep well. The Federal Open Market Committee

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Speaker 1: will wrap up a big two day meeting this Wednesday

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Speaker 1: with a decision on interest rates and a press conference

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Speaker 1: from Chairman J.

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Speaker 5: Powell.

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Speaker 1: What do you see happening? Do they pause again? Do

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Speaker 1: they hike by how much? What is Chairman Powell expected

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Speaker 1: to signal for the rest of the year.

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Speaker 6: You know, they better move or there could be a

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Speaker 6: lot of disappointed people on Wall Street. Futures markets are

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Speaker 6: pricing in at this point a ninety five percent chance

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Speaker 6: that they will raise rates, which is as good as

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Speaker 6: one hundred percent given the complexities of figuring all that out,

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Speaker 6: and so you can expect a rate increase twenty five

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Speaker 6: basis points. Then the question becomes, what does J. Powell

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Speaker 6: tell us about the future. We do not get a

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Speaker 6: new set of Dot plot projections, and we don't get

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Speaker 6: new economic projections, but in general economists think inflation will

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Speaker 6: continue to fall for a little bit, and unemployment will

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Speaker 6: hang in around the level it is. So does that

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Speaker 6: mean the FED is done? They did tell us in

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Speaker 6: June they thought they would go two more times, So

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Speaker 6: is that second one still on the table, And if so,

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Speaker 6: would it be in September at the next meeting or

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Speaker 6: would they do another skip and go on to November.

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Speaker 6: So the press conference is going to draw a lot

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Speaker 6: of interest.

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Speaker 1: Well, let's break down some of the data points that

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Speaker 1: Chairman Palell and the other members of the FED are

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Speaker 1: going to use to determine this decision. CPI.

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Speaker 6: For June, the CPI numbers were very encouraging because they

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Speaker 6: came in lower than anticipated, and a lot of categories

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Speaker 6: did show some movement in the direction the FED wants,

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Speaker 6: including rents, used cars, things that have been keeping the

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Speaker 6: CPI higher. So if you believe that trend is going

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Speaker 6: to continue, and the FED does believe that rents will

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Speaker 6: continue to go down and use car prices acording to

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Speaker 6: wholesalers are going to continue to go down, then that

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Speaker 6: could be good news. They'll be watching the services industries

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Speaker 6: to see if wage pressure is driving the service industry

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Speaker 6: inflation higher, but so far in the last couple of months,

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Speaker 6: it hasn't been, so the FED is on track. It

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Speaker 6: just gets to the point where, because we've only got

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Speaker 6: a percentage point to go on the CBI down to

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Speaker 6: two percent, that it takes a little more than you

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Speaker 6: each month to bring it down faster. We get very

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Speaker 6: small moves and that's good news, but it isn't where

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Speaker 6: they want to be.

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Speaker 1: But the labor market resilient, still strong, the jobless rate

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Speaker 1: last month falling down a three point six percent in June.

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Speaker 1: That's got to be encouraging.

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Speaker 6: Well, that's an argument that the FED has been considering

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Speaker 6: for a couple of years now. They have felt, and

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Speaker 6: most economists felt, that you have to drive unemployment up

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Speaker 6: because historically that's what you do to bring down demand.

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Speaker 6: But demand seems to be softening and inflation seems to

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Speaker 6: be coming down without unemployment rising. Last month it actually

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Speaker 6: went down a tick. So is this time different? It

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Speaker 6: does seem that way. We had some economists saying you

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Speaker 6: had to go as high as six percent. FED now

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Speaker 6: thinks that you'll get to four point one percent. But

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Speaker 6: is that even going to be the case. It's not

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Speaker 6: going to matter to them. They'd be very happy to

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Speaker 6: leave unemployment at three point six percent if inflation comes down,

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Speaker 6: because that might show this is a different kind of recovery.

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Speaker 1: Now, this doesn't impact the Fed's thinking too much, but

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Speaker 1: certainly Wall Street and that is bank earnings have been

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Speaker 1: a lot stronger than forecasts coming off that crisis in March.

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Speaker 1: Everyone on Wall Street expecting the same thing. With tech

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Speaker 1: earnings that are coming up.

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Speaker 6: Well, you got to think that maybe the same thing

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Speaker 6: will happen. The tech earnings will be a little bit

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Speaker 6: better than anticipated. I was at a conference last week

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Speaker 6: with some tech officials who said the business is pretty

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Speaker 6: good and that the worst is over for the tech industry.

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Speaker 6: There has been a lot of talk that we're still

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Speaker 6: having trouble finding workers, and therefore companies are going more

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Speaker 6: into automation, which should help boost that sector. And the

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Speaker 6: other thing, of course, obviously, is AI artificial intelligence and

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Speaker 6: what that means and how fast that is expanding.

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Speaker 1: Let's turn to someone we haven't heard from it in

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Speaker 1: a while, former FED chairman Ben Bernanke. Just last week

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Speaker 1: he said on a webinar organized by Fidelity Investments he

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Speaker 1: thinks the FED will raise rates by another twenty five

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Speaker 1: basis points. This week, As you mentioned, ninety five percent

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Speaker 1: of economists do. But he also said it might be

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Speaker 1: the last one for the year. Now, what are your

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Speaker 1: thoughts on that.

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Speaker 6: Well, you'd have to parse that and whether he means

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Speaker 6: they'll do something next year. But one assumes that he

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Speaker 6: means that's it, that this is the end of the

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Speaker 6: tightening cycle. Then the question moves on to how long

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Speaker 6: does the FED leave rates high? Markets think by March

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Speaker 6: or April, the Fed might be cutting rates, not because

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Speaker 6: the economy is in recession, that narrative is starting to change,

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Speaker 6: but because inflation is coming down, so that pushes up

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Speaker 6: real rates if that happens, and they want to keep

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Speaker 6: those from getting too high, So they might be cutting

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Speaker 6: rates in response to a much lower inflation rate. But

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Speaker 6: that's months away. We'll see if ben Berdenke's prognostication is

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Speaker 6: any better than anyone else's now.

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Speaker 1: In the upcoming months, there's a few things that could

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Speaker 1: really impact the Fed's thinking, the markets, the general economy,

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Speaker 1: and let's break down a few of these. Number one,

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Speaker 1: labor strife. There are things going on right now. Since

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Speaker 1: May second, we've had this writer strike, now a sag

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Speaker 1: after it, But there are a few others you're watching closely.

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Speaker 6: Yeah, the thing for the FED is that, yes, the

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Speaker 6: data have been going in the right direction, but there is,

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Speaker 6: as you mentioned, a lot that could change that, and

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Speaker 6: of course one of them is the possibility of labor action. Obviously,

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Speaker 6: the the actors and writers are on strike already. The

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Speaker 6: Yellow truck Company Yellow Trucking is looking at a possible

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Speaker 6: strike at the end of July, and that would be

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Speaker 6: about one hundred thousand workers. UPS and the Teamsters are negotiating,

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Speaker 6: and that's over two hundred thousand workers. So we could

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Speaker 6: see some major issues out there with people being off work.

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Speaker 6: And if you're off work and you're being paid on

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Speaker 6: a strike fund, you're getting less money and so you're

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Speaker 6: spending may go down. Now, the FED would look past

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Speaker 6: that initially to see if these things get settled quickly,

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Speaker 6: and if they do, it really isn't going to have

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Speaker 6: much of an impact. But if those things drag on,

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Speaker 6: then you could see major problems. Not to mention that

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Speaker 6: bad enough that Yellow Trucking might be down, but if

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Speaker 6: UPS stops delivering packages, that slows the whole economy because

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Speaker 6: so much of it is intermediate good that gets then

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Speaker 6: put into other goods, and so you could have a

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Speaker 6: real roadblock. I guess we go back to this supply

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Speaker 6: chain problems that we've been worried about for years. Those

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Speaker 6: come back and the economy takes a hit.

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Speaker 1: Well, another thing they come back is food inflation after

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Speaker 1: Russia broke a grain export agreement, which is obviously already

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Speaker 1: having an impact not so much here in the US,

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Speaker 1: but in Africa, in the Middle East, in Europe, and

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Speaker 1: that could really burge in into something really awful.

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Speaker 6: Yeah, that's a little bit longer term because and let's

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Speaker 6: say we've got good grain supplies. It's gonna be a

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Speaker 6: good harvest year in the Western Hemisphere, and so the

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Speaker 6: grain's going to be out there, be a little more

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Speaker 6: expensive because it has to travel longer distances. But next

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Speaker 6: year you run into a problem. And so the FED

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Speaker 6: can't go to sleep on this and say, well, inflation

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Speaker 6: is going to go away. When this is lurking out there.

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Speaker 6: They can't do anything about food inflation, but it does

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Speaker 6: influence psychology, and if you're cutting back on spending because

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Speaker 6: you're having to pay more for food, that's a problem.

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Speaker 6: The other issue that comes out of the war is

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Speaker 6: also energy. Energy prices. What's OPEC and OPEC plus which

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Speaker 6: includes Russia going to do? Are they going to keep

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Speaker 6: cutting rates? So I mean keep raising prices cutting I'm

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Speaker 6: thinking FED keep raising prices so they can make up

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Speaker 6: for some of the lost revenue they've gotten to come

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Speaker 6: more countries start trying to evade the embargoes on oil

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Speaker 6: energy prices could be another wild card for the FED

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Speaker 6: out there.

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Speaker 1: And another really bump on the horizon, but maybe be

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Speaker 1: more impactful for the fed's next meeting in September. But

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Speaker 1: the resumption of federal student loan payments.

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Speaker 6: That is going to be an interesting question because we

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Speaker 6: have a lot of numbers, but we don't know exactly

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Speaker 6: how this will play out. In September, they start collecting

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Speaker 6: interest again on the loans, and in October people have

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Speaker 6: to start paying. And so the question is have people

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Speaker 6: been spending all this extra money on other things and

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Speaker 6: that spending goes away and the money goes straight back

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Speaker 6: to the student loan servicers and sort of disappears from

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Speaker 6: the overall economy. There are some surveys that show a

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Speaker 6: lot of people continued to make their payments even though

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Speaker 6: they didn't have to. So if they did, then you

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Speaker 6: won't see a huge a huge problem, but it is

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Speaker 6: expected to hit a significant number of people, especially at

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Speaker 6: the lower levels of income, who spend pretty much everything

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Speaker 6: they have, and so that could be another problem.

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Speaker 1: That was Bloomberg's Global Economics and Policy editor Michael McKee,

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Speaker 1: and coming up on Bloomberg day Break weekend, decision day

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Speaker 1: for the Bank of Japan also about to hit us

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Speaker 1: this week. I'm Tom Busby, and this is Bloomberg. This

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Speaker 1: is Bloomberg Daybreak Weekend, our global look ahead at the

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Speaker 1: top stories for investors in the coming week. I'm Tom

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Speaker 1: Busby in New York. As we've been reporting, investors are

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Speaker 1: watching the coming week's Federal Reserve meeting. We're also watching

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Speaker 1: events in Togyo very closely. And for more, let's go

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Speaker 1: to Hong Kong and Bloomberg Daybreak Asia host Brian Curtis.

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Speaker 2: Tom, we look forward to the upcoming meeting of the

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Speaker 2: Bank of Japan with more than an ounce of anticipation.

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Speaker 2: Calls abound for change in the boj's ultra loose monetary policy. However,

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Speaker 2: Governor Kazua Ueitas said recently that the central Bank was

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Speaker 2: continuing with easing on the premise, the premise that Japan

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Speaker 2: is still some distance from achieving its two percent inflation goal.

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Speaker 2: Now we set a change in that premise is needed

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Speaker 2: in order to shift policy. The end weakened as the

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Speaker 2: market appeared to conclude that no change is in the offing.

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Speaker 2: Yet some strategists are saying that they won't rule out

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Speaker 2: a change in yield curve control policy sometime soon.

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Speaker 5: Well.

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Speaker 2: Joining us now for some insights on all of this

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Speaker 2: is Kathleen Hayes, Bloomberg's Global Economics and Policy editor. Kathleen

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Speaker 2: the boj has a tradition of not liking to be

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Speaker 2: pushed around to a certain degree by the media or

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Speaker 2: the investor community. So it seems like people are expecting something.

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Speaker 2: Does that maybe mean given that that we might see

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Speaker 2: more delay, Well.

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Speaker 7: People have changed their minds. It's interesting, Brian. If you

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Speaker 7: look at the Bloomberg Eco team survey that they did

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Speaker 7: just in these past few days, you'll see that in

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Speaker 7: they do an April survey, they do a July survey.

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Speaker 7: They do these surveys before the meetings. Anyway, before people

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Speaker 7: were looking forty percent of them thought that there would

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Speaker 7: be some kind of move of this July meeting, and

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Speaker 7: now it's eighty two percent who don't see a move

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Speaker 7: at this meeting. People are now looking to October, nothing

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Speaker 7: in September, something in October. And if you add up

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Speaker 7: all the people who see a chance of July and

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Speaker 7: the people who see a chance of September and then October,

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Speaker 7: you get over fifty percent. So that's where the market

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Speaker 7: expectation has moved.

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Speaker 2: The BOJ is a funny institution. It's unlike they're fed

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Speaker 2: in that it does like to surprise markets.

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Speaker 7: Why is that, Well, it's kind of old fashioned if

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Speaker 7: you ask me. That's what Paul Wolker used to do.

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Speaker 7: And back in the day, back when you had the

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Speaker 7: worst still inflation ever in the US, he wanted to

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Speaker 7: get more impact on the markets. And I expect that

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Speaker 7: the BOJ has that same sense that if you want

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Speaker 7: markets to react, if you want expectations to change, when

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Speaker 7: you surprise people, you have a longer lasting effect potentially.

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Speaker 2: Yeah, and Alan Greenspan didn't exactly tip his hand.

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Speaker 7: Much, did he not, like they knew nowadays?

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Speaker 2: Yeah, absolutely, So how likely is it then, do you

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Speaker 2: think that we might see perhaps something like yield curve

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Speaker 2: control adjusted at the next meeting.

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Speaker 7: Not too likely. What I has struck me so far

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Speaker 7: has become a very good communicator. He keeps saying that

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Speaker 7: he just wants to be sure that inflation is stably

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Speaker 7: and sustainably at two percent, and he often refers to

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Speaker 7: twenty twenty two when he was back on the board

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Speaker 7: of the BOJ and he dissented against a hike. They

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Speaker 7: went ahead and hiked, and it turned out what was

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Speaker 7: the wrong thing to do. Japan economy fell back. They

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Speaker 7: had to cut raids. And I've been told there's a

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Speaker 7: lot of BOJ staffers, you know, they've been there since

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Speaker 7: then and they don't want to make that mistake again.

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Speaker 7: And as I recall recently, former Deputy Governor Marca Tabe

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Speaker 7: told me, you know, the BOJ wants to be behind

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Speaker 7: the curve. They don't want to get out front because

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Speaker 7: they want to make sure that they don't mess things up.

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Speaker 7: And they feel that they for now they can wait.

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Speaker 7: The YenS well behaved, the bond market's better behave. There's

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Speaker 7: just no big pressure on them. And even though inflation

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Speaker 7: is so far over target, and even though they'll probably

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Speaker 7: boost their inflation forecast at the next meeting to just

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Speaker 7: two point three per perhaps is what our survey said.

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Speaker 7: They don't feel in a hurry to move.

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Speaker 2: It's an interesting environment. Policy makers clearly think that the

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Speaker 2: current levels of inflation are not sticky, and we've seen

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Speaker 2: a lot of sticky inflation everywhere around the world, but

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Speaker 2: the policymakers in Japan think that they will receive One

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Speaker 2: of the main reasons that they think inflation will fall back.

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Speaker 7: Well, one of the things they're watching very closely is

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Speaker 7: the global economy. And in fact, another thing I was

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Speaker 7: recently told we should be watching for is a change

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Speaker 7: in the GDP outlook to less growth next year. And

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Speaker 7: look what's happening in China, right, I mean, they're a

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Speaker 7: big driver in the Asian economy. Overall, US economy holding

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Speaker 7: up pretty well, but if the FED keeps hiking, what

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Speaker 7: does that mean for demand for Japanese exports. I think

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Speaker 7: that's a factor. The wage increases this past year were

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Speaker 7: pretty good, and in terms of there's the summer bonuses

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Speaker 7: which would start going out now, which apparently are still

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Speaker 7: expect to be pretty good. But there's just that chance

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Speaker 7: that you know that something will happen that it isn't

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Speaker 7: that inflation they're going to have deflation. It's just not

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Speaker 7: that they're going to have inflation staying so far above

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Speaker 7: two percent on the core right now. I believe it's

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Speaker 7: at like three point two to three point three percent

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Speaker 7: year over there. That takes out fresh food prices. But

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Speaker 7: they I think they still see not that they're so vulnerable,

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Speaker 7: but the global economy is vulnerable, and that's something that

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Speaker 7: keep an eye on.

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Speaker 2: So obviously there's a lot of debate about growth, global growth,

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Speaker 2: US growth. If we don't get a recession, if we

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Speaker 2: actually have a little bit stronger growth than expected, I

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Speaker 2: wonder whether or not that counter is the trend of

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Speaker 2: what the boj would be. You know, that inflation would

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Speaker 2: fall back below the target all the way to back

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Speaker 2: below two percent, which is why they would want to

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Speaker 2: keep the loose policy. How does it look for growth

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Speaker 2: in Japan at the moment.

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Speaker 7: Well, I think there's some there's some clouds over manufacturing.

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Speaker 7: I think investments held up reason well, but that's something

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Speaker 7: else they're looking at. Consumption spend holding up reasonably well.

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Speaker 7: There's no big red flag, and again it's it's it

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Speaker 7: remains to be seen, and what if China does finally

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Speaker 7: take some more steps what if they bring back confidence

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Speaker 7: in their domestic economy to get their their internal demand

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Speaker 7: growing again. There's a lot of ifs there and what

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Speaker 7: could happen. Just to speak about the FED for a minute,

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Speaker 7: we spoke in the last couple of days with Rob Kaplan,

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Speaker 7: former Dallas FED president, and his point is that what

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Speaker 7: we're seeing in the US economy in this all these

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Speaker 7: are Fed raid hikes in inflation coming down but not

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Speaker 7: down enough. Potentially, all the fiscal stimulus, all the fiscal

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Speaker 7: stimulus starting in you know, twenty twenty one, that's putting

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Speaker 7: it's that's still flooding through the economy, and that's one

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Speaker 7: reason why services are strong and why we see services inflation.

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Speaker 7: So that could be, yes, a welcome sign for the

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Speaker 7: boj because.

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Speaker 2: It's really it's really interesting when you look at it

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Speaker 2: in the US and think of the long and variable

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Speaker 2: lag of fiscal policy matched up against the long and

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Speaker 2: variable lag of FED interest rate hikes.

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Speaker 7: Well, and then what you have to figure out if

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Speaker 7: then you it isn't just the lag from the past,

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Speaker 7: If you're still pouring money into the economy, if the

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Speaker 7: federal government's doing that, out in that lag is going

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Speaker 7: to get out even further right, it's going to continue

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Speaker 7: to continue to continue. But even so people are figuring

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Speaker 7: what to maybe three hikes. I think people figure it'd

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Speaker 7: be a bit much for the Fed at this point

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Speaker 7: and for getting back to the BOJ. They have also

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Speaker 7: made it clear that if they do a tweak in

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Speaker 7: yield curve control, they will still be easy on monetary policy,

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Speaker 7: because they will not anytime soon be actually taking that

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Speaker 7: negative rate, the key rate at the short end, and

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Speaker 7: pushing it up to zero or higher.

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Speaker 2: How closely aligned is the Keisha to administration with the BOJ.

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Speaker 7: Seems it seems that there is a pretty good alignment

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Speaker 7: right now, And of course that's the Keisha administration probably

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Speaker 7: doesn't isn't looking forward to seeing any kind of reduction

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Speaker 7: in monetary stimulus. Number one, because they do want to

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Speaker 7: keep the economy growing, but also because they don't want

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Speaker 7: to see yields rising. They've got a big debt to finance.

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Speaker 7: They're going to be doubling what their defense spending this year.

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Speaker 7: They don't want to have to raise taxes, so right now,

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Speaker 7: I don't think that's why I don't really think there's

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Speaker 7: any inch of the BOJ that's saying oh, we have

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Speaker 7: to keep rates low to help the government finance its debt.

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Speaker 7: At the same time, they probably realized that it's a

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Speaker 7: nice spot to be in. You don't need to raise rates,

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Speaker 7: you don't need to get in the government's way. So

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Speaker 7: everybody's everybody's on the same page right now.

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Speaker 2: Kathleen, thanks so much for your insights. Really appreciate it.

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Speaker 2: Kathleen Hayes, Bloomberg Global Economics and Policy Editor. I'm Brian Curtis.

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Speaker 2: You can catch Doug Krisner and me every weekday for

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Speaker 2: Bloomberg day Break Gays at the beginning at six am

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Speaker 2: in Hong Kong and six pm on Wall Street.

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Speaker 1: Tom, thank you, Brian. And coming up on Bloomberg day

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Speaker 1: Break weekend, we go to the UK and what's happening

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Speaker 1: behind the scenes with an eyebrow raising story unfolding in

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Speaker 1: the banking industry there right now. I'm Tom Busby, and

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Speaker 1: this is.

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Speaker 5: Bloomberg broadcasting live from the Bloomberg it a active brokers

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Speaker 5: studio in New York. Bloomberg E Lemon free oh to Washington,

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Speaker 5: d C, Bloomberg ninety nine one to Boston, Bloomberg one

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Speaker 5: O six one to San Francisco, Bloomberg nine sixteen to

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Speaker 5: the country, Sirius XM Channel one nineteen to London DAB

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Speaker 5: Digital radio, and around the globe the Bloomberg Business app

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Speaker 5: in Bloomberg Radio dot com. This is Bloomberg Daybreak weekend.

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Speaker 1: I'm Tom Busby in New York with your global look

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Speaker 1: ahead at the top stories for investors in the coming week.

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Speaker 1: Nat West will report second quarter earnings next week in

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Speaker 1: the UK after two quarters in which the bank missed

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Speaker 1: on the key metric of net interest income. But the

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Speaker 1: bank and its CEO, Alison Rose, are also under scrutiny

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Speaker 1: for a very different issue, the closure the bank account

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Speaker 1: of Brexit advocate Nigel Farage by Coots. That's a unit

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Speaker 1: of Newest. Let's head over to our London bureau now

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Speaker 1: and Bloomberg Daybreak anchor Caroline Hepgar.

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Speaker 3: The former leader of the UK Independence and Brexit Party,

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Speaker 3: Nigel Farage, has called for a parliamentary inquiry into why

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Speaker 3: Coots closed his bank account last month. So the pro

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Speaker 3: exit politician, speaking of Bloomberg Radio, says that the internal

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Speaker 3: documents from the bank, a unit of nat West, show

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Speaker 3: that his account was closed because of his views. Farage

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Speaker 3: published a forty page report from Couts is not limited

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Speaker 3: to Farage's financial position. It also includes analysis of his

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Speaker 3: public comments and media coverage. And I'm sure you know,

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Speaker 3: but this issue has created a media storm which has

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Speaker 3: drawn in the Prime Minister Johiny Now in studio as

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Speaker 3: Bloomberg's finance reporter Will Shaw, We've been tracking this story

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Speaker 3: and we interviewed Nigel Farage together. How did first of

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Speaker 3: all this route actually all start.

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Speaker 8: So a few weeks ago, Coots, which is a banker

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Speaker 8: to the wealthy, including the royal family, closed down his

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Speaker 8: bank account. Now, at the time, people familiar with that

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Speaker 8: decision indicated that that was because he hadn't deposited enough

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Speaker 8: money with the firm. Similar stories round in the BBC

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Speaker 8: and the Financial Times. Nigel Farage, however, had put in

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Speaker 8: a subject access request to KUTS, asking documents that would

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Speaker 8: indicate why the decision was made. Now, these documents appear

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Speaker 8: to suggest that they considered his political views and made

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Speaker 8: an assessment that his values didn't match to Kotz's wider

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Speaker 8: commitment to inclusion.

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Speaker 3: Well, you and I spoke to the politician and broadcaster

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Speaker 3: Nigel Farag, so I want us to listen to that

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Speaker 3: extensive interview.

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Speaker 9: Well, it's pretty clear, isn't it that when that decision

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Speaker 9: was taken it was because I do not.

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Speaker 5: Fit with their agenda.

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Speaker 9: I do not fit with their policies apparently of diversity

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Speaker 9: and inclusion. I do not represent their values. I am

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Speaker 9: a very very bad person because I happen to hold

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Speaker 9: views which are legal and our majority views in the

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Speaker 9: country that the upper class, upper middle class types than

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Speaker 9: habit coots don't share. So it's pretty clear if you

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Speaker 9: look at the seventeenth of November, it's pretty night that

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Speaker 9: decision was made.

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Speaker 3: Nigel. Have they lied then, They've.

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Speaker 9: Lied about the They've lied about the initial reason for

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Speaker 9: closing the account. Yes, I mean what they would say

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Speaker 9: in their defense is that since November twenty twenty two

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Speaker 9: there was a big draw down on the account, a

437
00:23:44,680 --> 00:23:47,840
Speaker 9: temporary draw down on the account, but it's now back

438
00:23:47,920 --> 00:23:52,800
Speaker 9: up to the levels that they themselves described as commercially viable.

439
00:23:53,160 --> 00:23:55,480
Speaker 9: So look, you know they've been absolutely dishonest about this

440
00:23:55,520 --> 00:23:56,160
Speaker 9: all the way through.

441
00:23:56,600 --> 00:24:00,240
Speaker 8: In this document it says that at one point says,

442
00:24:00,240 --> 00:24:03,640
Speaker 8: it's clear that you project cenophobic, chauvinistic and racist views,

443
00:24:03,640 --> 00:24:06,000
Speaker 8: although you've done it within the law, and there's also

444
00:24:06,320 --> 00:24:08,320
Speaker 8: they also say there's a perception of you as a

445
00:24:08,359 --> 00:24:13,320
Speaker 8: disingenuous grifter. Do you have any plans to sue the bank?

446
00:24:13,480 --> 00:24:17,200
Speaker 8: Or is it your view that anyone NatWest or cootsort

447
00:24:17,240 --> 00:24:18,400
Speaker 8: to resign over this?

448
00:24:19,640 --> 00:24:24,560
Speaker 9: It is bile, it is poison, It is written with venom.

449
00:24:25,200 --> 00:24:28,760
Speaker 9: It is prejudiced in a most extraordinary way that only

450
00:24:29,119 --> 00:24:32,200
Speaker 9: the upper middle classes who live in central London postcodes

451
00:24:32,240 --> 00:24:35,600
Speaker 9: could possibly do. And I think this is why airing

452
00:24:35,680 --> 00:24:38,399
Speaker 9: it in public is causing them such a panic.

453
00:24:39,160 --> 00:24:40,520
Speaker 8: Look should should someone?

454
00:24:40,720 --> 00:24:40,960
Speaker 5: Do you?

455
00:24:41,080 --> 00:24:43,000
Speaker 8: Do you think that someone ought to resign over it?

456
00:24:43,040 --> 00:24:44,200
Speaker 8: And if so, who don't.

457
00:24:44,040 --> 00:24:45,879
Speaker 9: Want to think? I don't want to think should happen?

458
00:24:46,480 --> 00:24:49,520
Speaker 9: I think the bosses of the RBS group should appear

459
00:24:49,560 --> 00:24:53,640
Speaker 9: before a parliamentary committee to explain why they now make

460
00:24:53,760 --> 00:24:57,880
Speaker 9: political and moral judgments on customers of THEIRS who meet

461
00:24:57,920 --> 00:25:00,960
Speaker 9: their financial requirements and who give it opinions that are

462
00:25:01,160 --> 00:25:04,800
Speaker 9: entirely within the law and our majority views in this country.

463
00:25:05,440 --> 00:25:07,879
Speaker 3: In terms of the timing. Then that was the other

464
00:25:07,960 --> 00:25:10,480
Speaker 3: question I was going to ask you. Obviously, you were

465
00:25:10,800 --> 00:25:12,520
Speaker 3: leader of u KIT between two thousand and six two

466
00:25:12,520 --> 00:25:15,880
Speaker 3: thousand and nine Brexit party leader twenty ten to twenty sixteen.

467
00:25:16,200 --> 00:25:18,680
Speaker 3: Why do you think the bank made the decision now?

468
00:25:19,800 --> 00:25:22,960
Speaker 9: I think it's the whole RBS group. I think that

469
00:25:23,880 --> 00:25:27,119
Speaker 9: the boss of the group now, Alison Rose, has taken

470
00:25:27,720 --> 00:25:31,360
Speaker 9: Coots and taken nat West into territory that I think

471
00:25:31,440 --> 00:25:35,439
Speaker 9: is highly political. I think it's been a shift in

472
00:25:35,480 --> 00:25:38,080
Speaker 9: the way these banks view the world and view their customers.

473
00:25:38,119 --> 00:25:40,639
Speaker 9: And that is my best guess as to the timing

474
00:25:40,680 --> 00:25:42,800
Speaker 9: of it. There's nothing I've said or done there's any

475
00:25:42,840 --> 00:25:44,760
Speaker 9: different to what I've said and done for the previous

476
00:25:44,800 --> 00:25:45,640
Speaker 9: twenty years.

477
00:25:46,720 --> 00:25:49,680
Speaker 8: Bloomberg last year wrote about the performance of an investment

478
00:25:49,680 --> 00:25:52,760
Speaker 8: advice service that you were promoting, and if people had

479
00:25:52,800 --> 00:25:54,920
Speaker 8: followed that advice, they would have lost quite a bit

480
00:25:54,920 --> 00:25:55,359
Speaker 8: of money.

481
00:25:55,359 --> 00:25:57,720
Speaker 9: The performance was they'd have been in gold and in

482
00:25:57,800 --> 00:26:00,280
Speaker 9: sterling terms, gold's been at all time highs. And if

483
00:26:00,320 --> 00:26:02,080
Speaker 9: you want to talk to me about anything else you

484
00:26:02,119 --> 00:26:04,119
Speaker 9: can do. What the hell you're like, I'm not interested

485
00:26:04,200 --> 00:26:06,639
Speaker 9: or I'm.

486
00:26:05,840 --> 00:26:08,119
Speaker 3: In terms of Alison Rose, you think that she has

487
00:26:08,280 --> 00:26:10,520
Speaker 3: questions to answer personally for this situation.

488
00:26:12,080 --> 00:26:14,440
Speaker 9: I think she's going to be questioned by I think

489
00:26:14,480 --> 00:26:18,320
Speaker 9: mainstream media as we speak are asking those questions you know,

490
00:26:18,359 --> 00:26:20,480
Speaker 9: what have you done? What have you done with this

491
00:26:20,560 --> 00:26:23,440
Speaker 9: banking group? What direction are you taking it in? Aren't

492
00:26:23,480 --> 00:26:24,960
Speaker 9: you beginning to behave to behave a bit more like

493
00:26:25,000 --> 00:26:27,960
Speaker 9: a political organization than a bank. That is that a

494
00:26:28,000 --> 00:26:30,920
Speaker 9: bank group that is forty percent owned by the taxpayer.

495
00:26:30,960 --> 00:26:33,520
Speaker 9: So yeah, look, I just hope by coming out in public,

496
00:26:33,840 --> 00:26:36,639
Speaker 9: I sponsor a very very big debate about what banks

497
00:26:36,680 --> 00:26:41,119
Speaker 9: are for. And ultimately, ultimately what I want is for

498
00:26:41,240 --> 00:26:44,760
Speaker 9: everybody to have the right to a bank account, the

499
00:26:44,920 --> 00:26:47,879
Speaker 9: right to their own business account. This used to exist

500
00:26:47,960 --> 00:26:50,959
Speaker 9: in our country before the privatization of the post office.

501
00:26:51,480 --> 00:26:55,240
Speaker 9: It still exists in comparable countries like France and Germany.

502
00:26:55,440 --> 00:26:57,480
Speaker 9: And I think this is a very very important and

503
00:26:57,480 --> 00:27:00,600
Speaker 9: fundamental issue because as we move toward more and more

504
00:27:00,640 --> 00:27:03,879
Speaker 9: digitized society, whether we like it or not, without a

505
00:27:03,880 --> 00:27:06,440
Speaker 9: bank account, you simply can't exist. I mean, you've virtually

506
00:27:06,480 --> 00:27:07,399
Speaker 9: become a non person.

507
00:27:09,080 --> 00:27:12,480
Speaker 3: So that was the politician and broadcaster Nigel Farage talking

508
00:27:12,520 --> 00:27:16,200
Speaker 3: about the contents of that report. Why Coots made the decision. Now,

509
00:27:16,280 --> 00:27:20,800
Speaker 3: in response to Farage's comments, a spokesperson for Coots has

510
00:27:20,840 --> 00:27:24,400
Speaker 3: given us this statement. It's being read here in full

511
00:27:24,480 --> 00:27:25,840
Speaker 3: by Ablinberg journalist.

512
00:27:26,640 --> 00:27:31,080
Speaker 10: We recognize the substantial interest in this case. We cannot

513
00:27:31,080 --> 00:27:36,160
Speaker 10: comment on the detail given our customer confidentiality obligations. However,

514
00:27:36,680 --> 00:27:40,400
Speaker 10: it is not Kotz's policy to close customer accounts solely

515
00:27:40,400 --> 00:27:44,040
Speaker 10: on the basis of legally held political and personal views.

516
00:27:45,119 --> 00:27:48,720
Speaker 10: Decisions to close an account are not taken lightly and

517
00:27:48,840 --> 00:27:54,680
Speaker 10: involve a number of factors, including commercial viability, reputational considerations,

518
00:27:55,000 --> 00:28:00,679
Speaker 10: and legal and regulatory requirements. We recognize the critical importance

519
00:28:00,720 --> 00:28:04,040
Speaker 10: of access to banking. When it became clear that our

520
00:28:04,040 --> 00:28:08,680
Speaker 10: client was unable to secure banking facilities elsewhere, and as

521
00:28:08,680 --> 00:28:13,240
Speaker 10: he has confirmed publicly, he was offered alternative banking facilities

522
00:28:13,240 --> 00:28:17,439
Speaker 10: with that West that offer stands. We understand the public

523
00:28:17,520 --> 00:28:21,320
Speaker 10: concern that the process for ending a customer relationship and

524
00:28:21,359 --> 00:28:26,440
Speaker 10: how that is communicated are not sufficiently transparent. We welcome

525
00:28:26,520 --> 00:28:31,600
Speaker 10: the anticipated HM Treasury recommendations in this area, alongside the

526
00:28:31,760 --> 00:28:36,120
Speaker 10: ask to prioritize the review of the regulatory rules related

527
00:28:36,160 --> 00:28:40,280
Speaker 10: to politically exposed persons. We look forward to working with

528
00:28:40,360 --> 00:28:44,440
Speaker 10: the government, the regulator, and the wider industry to ensure

529
00:28:44,440 --> 00:28:47,280
Speaker 10: that universal access to banking is maintained.

530
00:28:47,520 --> 00:28:50,560
Speaker 3: Okay, so that is the Cootes response. Then to Nigel

531
00:28:50,600 --> 00:28:54,520
Speaker 3: Farage's comments there in full, Bluebig's finance reporter Will Shaw

532
00:28:54,600 --> 00:28:57,720
Speaker 3: is still with me, just really go through this story.

533
00:28:57,920 --> 00:29:02,880
Speaker 3: How significant an issue actually is this idea of closing

534
00:29:02,880 --> 00:29:04,680
Speaker 3: bank accounts for customers.

535
00:29:05,040 --> 00:29:07,200
Speaker 8: I think it would be easy to say, oh, this

536
00:29:07,280 --> 00:29:10,480
Speaker 8: is just Nigel Farage, this is just something that affects

537
00:29:10,880 --> 00:29:14,520
Speaker 8: one person. He obviously he has a very unique political

538
00:29:14,600 --> 00:29:18,600
Speaker 8: standing in UK life. Despite his sort of class war rhetoric.

539
00:29:18,600 --> 00:29:22,479
Speaker 8: He's for a wealthy background. He's a former trader until

540
00:29:22,560 --> 00:29:25,600
Speaker 8: very recently he even had an account with coots. However,

541
00:29:25,800 --> 00:29:28,400
Speaker 8: like there is concern that this might well set a

542
00:29:28,480 --> 00:29:31,920
Speaker 8: wider precedent. As you heard in warning there, there are

543
00:29:32,040 --> 00:29:35,479
Speaker 8: lots of people that share Nigel Farage's views, as he

544
00:29:35,520 --> 00:29:37,720
Speaker 8: would be he would be quick to point out, and

545
00:29:37,760 --> 00:29:42,000
Speaker 8: as the Brexit vote demonstrated in twenty sixteen, so he

546
00:29:42,040 --> 00:29:45,520
Speaker 8: would argue that if he can be targeted on his

547
00:29:45,600 --> 00:29:48,840
Speaker 8: political values, all kinds of people can be targeted in

548
00:29:48,880 --> 00:29:49,560
Speaker 8: the same way.

549
00:29:49,840 --> 00:29:53,680
Speaker 3: So that was Willshaw and I speaking to Nigel Farage.

550
00:29:53,680 --> 00:29:56,560
Speaker 3: My thanks to Bloomberg Finance report at Will Shaw. I'm

551
00:29:56,600 --> 00:29:58,680
Speaker 3: Calline Hepge here in London you can catch us every

552
00:29:58,720 --> 00:30:01,440
Speaker 3: weekday morning for boom Big day Break here at beginning

553
00:30:01,440 --> 00:30:04,120
Speaker 3: at six am in London. That's one am on Wall Street.

554
00:30:04,200 --> 00:30:07,320
Speaker 1: Tom, Thank you, Caroline. And coming up here on Bloomberg

555
00:30:07,360 --> 00:30:10,560
Speaker 1: day Break Weekend, Hunter Biden and the challenges Democrats may

556
00:30:10,640 --> 00:30:14,880
Speaker 1: face on that front. I'm Tom Busby, and this is Bloomberg.

557
00:30:25,600 --> 00:30:27,960
Speaker 1: This is Bloomberg day Break Weekend, our global look ahead

558
00:30:27,960 --> 00:30:30,280
Speaker 1: at the top stories for investors in the coming week.

559
00:30:30,440 --> 00:30:33,560
Speaker 1: I'm Tom Busby in New York. Hunter Biden facing a

560
00:30:33,720 --> 00:30:35,880
Speaker 1: court date in the coming week, and for more, Let's

561
00:30:35,880 --> 00:30:38,600
Speaker 1: head to our Bloomberg ninety nine one newsroom in Washington

562
00:30:38,720 --> 00:30:41,920
Speaker 1: and Bloomberg Sound On. Co host Kaylee Lines.

563
00:30:42,160 --> 00:30:45,720
Speaker 4: That's right, Tom. This coming Wednesday, July twenty sixth, Hunter

564
00:30:45,760 --> 00:30:49,000
Speaker 4: Biden is expected to formally plead guilty in a Delaware

565
00:30:49,040 --> 00:30:53,959
Speaker 4: court to two misdemeanor tax charges and in theory avoid

566
00:30:54,000 --> 00:30:58,080
Speaker 4: prosecution on a separate gun related charge. The judge Mary

567
00:30:58,120 --> 00:31:00,800
Speaker 4: Ellen nor aka, a Trump APPOINTEEPS still has to sign

568
00:31:00,840 --> 00:31:02,720
Speaker 4: off on the Plea deal that we first learned about

569
00:31:02,800 --> 00:31:05,320
Speaker 4: last month, a deal that has drawn the ire of

570
00:31:05,360 --> 00:31:09,000
Speaker 4: many Republicans. It's a political firestorm, to say the least

571
00:31:09,440 --> 00:31:12,240
Speaker 4: joining me now to discuss this is Wendy Benjaminson, our

572
00:31:12,400 --> 00:31:16,320
Speaker 4: Washington senior editor. So Wendy, what exactly do we expect

573
00:31:16,400 --> 00:31:18,760
Speaker 4: to go down in court this coming week? Is this

574
00:31:18,800 --> 00:31:20,160
Speaker 4: going to be pretty steamless?

575
00:31:20,520 --> 00:31:24,680
Speaker 11: I think that court appearance will be yes, Killy, you know,

576
00:31:24,720 --> 00:31:29,080
Speaker 11: pretty straightforward. It's what's happening in the courtroom of the

577
00:31:29,120 --> 00:31:33,520
Speaker 11: House of Representatives, where it is far less seamless, and

578
00:31:33,760 --> 00:31:37,000
Speaker 11: on the twenty twenty four campaign trail. But in Delaware

579
00:31:37,000 --> 00:31:40,120
Speaker 11: he's going to plead guilty to gun and tax charges.

580
00:31:40,480 --> 00:31:42,960
Speaker 11: He already has made a deal with prosecutors, so there

581
00:31:42,960 --> 00:31:47,000
Speaker 11: should be no surprises there whatsoever, except the spectacle of

582
00:31:47,080 --> 00:31:50,480
Speaker 11: a son of the United States President President excuse me,

583
00:31:51,440 --> 00:31:54,160
Speaker 11: being charged with kind of low level crime.

584
00:31:54,520 --> 00:31:57,040
Speaker 4: Well, speaking of spectacles and Whndy, you just mentioned the

585
00:31:57,080 --> 00:32:01,040
Speaker 4: House of Representatives. Just this past week, Oversight Committee had

586
00:32:01,080 --> 00:32:04,080
Speaker 4: a hearing with two irs whistleblowers who talked about the

587
00:32:04,120 --> 00:32:08,120
Speaker 4: investigation into Hunter Biden, and even members of not this

588
00:32:08,160 --> 00:32:12,840
Speaker 4: committee showed up, including Houseways and Means Committee chairman Jason Smith.

589
00:32:13,000 --> 00:32:15,479
Speaker 4: Here's a taste of what he had to say about this.

590
00:32:15,840 --> 00:32:20,719
Speaker 12: The Department of Justice engaged in a campaign to delay, divulge,

591
00:32:21,200 --> 00:32:27,320
Speaker 12: and deny that investigation. They delayed investigators for years, leading

592
00:32:27,360 --> 00:32:30,880
Speaker 12: to the expiration of the Statute of limitations for many

593
00:32:31,040 --> 00:32:33,000
Speaker 12: of the crimes involved.

594
00:32:33,840 --> 00:32:38,360
Speaker 4: So, Wendy, it speaks to just how political this is

595
00:32:38,520 --> 00:32:41,160
Speaker 4: and how conservatives see this as another example of a

596
00:32:41,160 --> 00:32:44,320
Speaker 4: two tier justice system where the president and his family

597
00:32:44,440 --> 00:32:47,360
Speaker 4: are being treated differently than say, the former president.

598
00:32:48,480 --> 00:32:53,160
Speaker 11: Well exactly, kay, this is you know, this sort of

599
00:32:53,280 --> 00:32:57,040
Speaker 11: all goes to the taste of what the campaign is

600
00:32:57,080 --> 00:32:59,640
Speaker 11: going to be like through next year. The thing is

601
00:32:59,680 --> 00:33:03,360
Speaker 11: that the House Republicans are sort of on a revenge

602
00:33:03,520 --> 00:33:08,360
Speaker 11: tour after the Trump Russia investigation, which consumed the first

603
00:33:08,360 --> 00:33:12,440
Speaker 11: part of Trump's presidency while he was doing his own

604
00:33:13,120 --> 00:33:17,280
Speaker 11: you know, sort of unusual actions as president, and then

605
00:33:17,280 --> 00:33:20,640
Speaker 11: this Trump Russian investigation which turned out to be really nothing,

606
00:33:21,880 --> 00:33:24,440
Speaker 11: you know, in what Republicans are mad at and what

607
00:33:24,600 --> 00:33:27,880
Speaker 11: is driving them to pretty much do the same thing

608
00:33:27,920 --> 00:33:31,680
Speaker 11: with Hunter Biden. There is a circumstantial case for what

609
00:33:31,800 --> 00:33:35,560
Speaker 11: the Houseways and Means Chairman there said, the Justice Department

610
00:33:35,800 --> 00:33:40,120
Speaker 11: did let the statute of limitations expire. What we don't

611
00:33:40,200 --> 00:33:43,280
Speaker 11: have is motive. What we don't have is whether this

612
00:33:43,440 --> 00:33:47,800
Speaker 11: is just bureaucracy speed, you know, the flowness of bureaucracy,

613
00:33:48,040 --> 00:33:51,160
Speaker 11: whether it was incompetence or whether as Republicans seemed to

614
00:33:51,200 --> 00:33:54,280
Speaker 11: firmly believe, this was a political operation.

615
00:33:54,440 --> 00:33:56,840
Speaker 4: And given that we're talking about the president's son, it's

616
00:33:56,880 --> 00:33:59,600
Speaker 4: worth pointing out, Wendy, that he hasn't had that much

617
00:33:59,640 --> 00:34:02,440
Speaker 4: to say on this, the President himself, just that he

618
00:34:02,520 --> 00:34:05,200
Speaker 4: loves his son, that kind of thing, very little comment.

619
00:34:05,720 --> 00:34:07,400
Speaker 4: How big of a headache is this for him?

620
00:34:07,760 --> 00:34:11,440
Speaker 11: It's a pretty big headache because every time, you know,

621
00:34:12,480 --> 00:34:14,879
Speaker 11: I'm not sure it's pretty big headache, because every time

622
00:34:14,880 --> 00:34:18,080
Speaker 11: he wants to talk about you know, bid nomics his

623
00:34:18,640 --> 00:34:22,959
Speaker 11: coined phrase for you know, his economic policies, he wants

624
00:34:23,000 --> 00:34:25,240
Speaker 11: to talk about that, he wants to talk about his record,

625
00:34:25,560 --> 00:34:28,160
Speaker 11: and the Republicans respond with Biden crime family.

626
00:34:28,280 --> 00:34:31,040
Speaker 4: Definitely something that is going to be difficult for President

627
00:34:31,040 --> 00:34:34,799
Speaker 4: Biden to escape. But also Biden seeking re election in

628
00:34:34,880 --> 00:34:37,160
Speaker 4: twenty twenty four, I would imagine if this narrative is

629
00:34:37,160 --> 00:34:40,600
Speaker 4: going to feature pretty prominently in campaigns against him. Wendy

630
00:34:40,640 --> 00:34:44,360
Speaker 4: Benjamins in Washington, Senior Editor, thank you so much, and Tom,

631
00:34:44,520 --> 00:34:45,440
Speaker 4: we'll send it back to you.

632
00:34:45,800 --> 00:34:48,480
Speaker 1: Thank you, Kaylee. That was Bloomberg's sound on co host

633
00:34:48,600 --> 00:34:51,720
Speaker 1: Kaylee Lines, reporting from our Bloomberg ninety nine one newsroom

634
00:34:51,760 --> 00:34:54,879
Speaker 1: in Washington. And you can hear sound on weekdays one

635
00:34:54,920 --> 00:34:58,120
Speaker 1: to three pm on Bloomberg Radio. And that does it

636
00:34:58,160 --> 00:35:00,959
Speaker 1: for this edition of Bloomberg Daybreak Weekend. Join us again

637
00:35:00,960 --> 00:35:03,080
Speaker 1: Monday morning at five am Wall Street Time for the

638
00:35:03,160 --> 00:35:05,960
Speaker 1: latest on markets overseas and the news you need to

639
00:35:06,000 --> 00:35:09,239
Speaker 1: start your day. I'm Tom Buzzby. Stay with us. Top

640
00:35:09,280 --> 00:35:13,000
Speaker 1: stories and global business headlines are coming up right now