WEBVTT - Auto Workers Strike Looms; ARM IPO Begins Trading

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<v Speaker 1>Good morning.

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<v Speaker 2>I'm Nathan Hager and I'm Karen Moscow. Here are the

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<v Speaker 2>stories we're following today.

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<v Speaker 3>We are now just hours away from a strike that

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<v Speaker 3>could do serious damage to the US economy. The United

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<v Speaker 3>Autoworkers and Detroit's three top automakers have till midnight tonight

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<v Speaker 3>to agree on new labor contracts. Union president Sean Fain

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<v Speaker 3>says they're making progress with four General Motors and Stillantis,

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<v Speaker 3>but are still far apart on key issues.

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<v Speaker 4>From job security to ending tears, from cost to living

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<v Speaker 4>allowance to wage increases. We do not yet have offers

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<v Speaker 4>on the table that reflect a sacrifice and contributions are

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<v Speaker 4>members have made to these companies.

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<v Speaker 3>Speaking on a Facebook and YouTube live stream, the UAW,

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<v Speaker 3>Sean Fain says if they don't reach a deal in time,

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<v Speaker 3>the workers will begin to strike at targeted locations. Meanwhile,

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<v Speaker 3>Ford CEO Jim Farley spoke at a Mustang event at

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<v Speaker 3>the Detroit Auto Show, saying he still thinks a deal

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<v Speaker 3>can get done.

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<v Speaker 5>Still optimistic that we'll get a deal, but there is

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<v Speaker 5>a limit and because we have to protect for the

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<v Speaker 5>future future investments and the profitability the company funds those.

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<v Speaker 3>Ford CEO Jim Farley says the union hasn't made a

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<v Speaker 3>serious counteroffer to any of his company's proposals.

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<v Speaker 2>Well, Nathan, we have another event that's impacting consumers this morning.

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<v Speaker 6>A huge hack of casinos.

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<v Speaker 2>Caesar's and MGM have been hacked by the same group

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<v Speaker 2>within several weeks of each other. Bloomberg's Ed Baxter has

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<v Speaker 2>this story from San Francisco.

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<v Speaker 7>Caesar's Entertainment is expected to disclose details of the hack

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<v Speaker 7>of its system soon, but Bloomberg sources say it looks

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<v Speaker 7>to be tens of millions of dollars. The group behind

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<v Speaker 7>the attack and the one on the MGM are attributed

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<v Speaker 7>to a group known as Scattered Spider or UNC three

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<v Speaker 7>nine four four. The Caesars hack first hit an outside

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<v Speaker 7>vendor before gaining access to the company's network. Members of

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<v Speaker 7>the group are believed to be young adults, some as

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<v Speaker 7>young as nineteen years of age, residing in the US

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<v Speaker 7>and the UK. Hacking gangs typically asked to be paid

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<v Speaker 7>in crypto. I'm at Baxter, Bloomberg Radio.

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<v Speaker 3>And thanks turning the market. Shares of ARM begin trading

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<v Speaker 3>later this morning on the Nasdaq. The chip designer, backed

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<v Speaker 3>by SoftBank, price It's IPO at fifty one dollars per share,

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<v Speaker 3>the top end of the range. Bloomberg's Julia Fioretti says

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<v Speaker 3>ARM is valued head close to fifty five billion.

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<v Speaker 8>It's still a hugely important deal for the IPO market globally.

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<v Speaker 8>Almost a lot of people are looking at It is

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<v Speaker 8>obviously a test also of the AI boom that we've seen,

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<v Speaker 8>which has been powering this rally in the market. So

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<v Speaker 8>a lot is riding on this offering.

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<v Speaker 3>Bloomberg's Julia Fioretti says the IPO is the world's biggest

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<v Speaker 3>this year.

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<v Speaker 2>Well Nathan tech tycoons gathered at a closed door Senate

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<v Speaker 2>meeting to shape how artificial intelligence is regulated. The meeting

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<v Speaker 2>was organized by Senate Majority leader Chuck Schumer. It included

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<v Speaker 2>CEOs of Alphabet, Microsoft, Meta Platforms, and Elon Musk. The

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<v Speaker 2>Tesla and X CEO talked with the reporters after the meeting.

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<v Speaker 9>The reason that I've been so AI safety in advance

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<v Speaker 9>of sort of anything terrible happening is that I think

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<v Speaker 9>the consequences of AI going wrong are sphere, so we

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<v Speaker 9>have to be proactive rather than reactive.

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<v Speaker 3>I Meanwhile, Musk has agreed to try to settle claims

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<v Speaker 3>by thousands of former Twitter employees who say they were

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<v Speaker 3>cheated out of severance pay. That's according to a memo

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<v Speaker 3>from a lawyer for the workers seen by Bloomberg News.

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<v Speaker 3>The X, the company formerly known as Twitter, has been

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<v Speaker 3>accused in multiple suits of numerous labor and workplace violations,

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<v Speaker 3>including failing to pay severance to thousands who were fired

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<v Speaker 3>late last year after Musk's forty four billion dollar acquisition.

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<v Speaker 2>Well, Nathan, we have plenty of financial news to get

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<v Speaker 2>you caught up on this morning. Bloomberg News has learned

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<v Speaker 2>Goldman's sax As fire transaction banking executives, including the head

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<v Speaker 2>of the business, over compliance lapses, and.

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<v Speaker 3>City Group is preparing for a wave of job cuts.

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<v Speaker 3>The CEO, Jane Fraser's looking to restructure the Wall Street giant.

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<v Speaker 3>The firm will now operate five main businesses and eliminate

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<v Speaker 3>the three regional chiefs who oversaw operations in about one

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<v Speaker 3>hundred sixty countries. Jane Fraser says the shakeup will have

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<v Speaker 3>a big impact on the business.

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<v Speaker 10>The changes are the most consequential changes to how City

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<v Speaker 10>will be organized and run that we've made in almost

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<v Speaker 10>twenty years, and What this move enables me to do

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<v Speaker 10>is not only flatten the organization, but it also enables

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<v Speaker 10>me to be much more directly involved in making sure

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<v Speaker 10>that those businesses are performing.

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<v Speaker 3>City Group CEO Jane Fraser spoke at the Barclays Global

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<v Speaker 3>Financial Services Conference.

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<v Speaker 2>Well, we now take you to Europe, Nathan, where the

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<v Speaker 2>ECB is in focus. A central bank and it's president,

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<v Speaker 2>Christine Leguard make an interest rate decision this morning, and

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<v Speaker 2>Bloomberg's U and parties in London with a preview. Good

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<v Speaker 2>morning you and.

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<v Speaker 11>Good morning Karen, Nathan. It's a cliffhanger decision day for

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<v Speaker 11>the European Central Bank. Economists in Bloomberg survey are split

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<v Speaker 11>down the middle as to whether the twenty countries in

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<v Speaker 11>the euro Area will get a tenth straight rateich or

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<v Speaker 11>a pause. Traders are leading toward a twenty five basis

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<v Speaker 11>point increase. They're pricing in a roughly two in three

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<v Speaker 11>chance that the ECB hawks win.

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<v Speaker 9>The day.

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<v Speaker 11>Will find out how this story ends at seven to

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<v Speaker 11>fifteen am New York time in London. I'm you and

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<v Speaker 11>Potspin Beckradia you and thank you.

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<v Speaker 3>And as global central banks try to manage inflation, Ray

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<v Speaker 3>Dalyo says bonds are no longer a good long term buy.

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<v Speaker 3>The Bridgewater founder says he currently prefers cash.

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<v Speaker 12>It's not just the supply demand, isn't just the amount

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<v Speaker 12>of new bonds.

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<v Speaker 1>It's the issue of do you choose to sell the bonds.

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<v Speaker 13>I personally believe that the bonds longer term are not

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<v Speaker 13>a good investment.

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<v Speaker 3>Ray Dalyo spoke at the Milken Institute Asia's summit in Singapore.

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<v Speaker 2>All Right, Nathan, thank you, and it's time now for

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<v Speaker 2>a look at some of the other stories making news

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<v Speaker 2>around the world. For that, we're joined by Bloomberg's John Tucker. John,

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<v Speaker 2>Good morning, Kay.

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<v Speaker 14>Good morning Karen. Hurricane Lee has barreled north toward New England.

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<v Speaker 14>It's threatening to unleash violent storms of the region. This

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<v Speaker 14>comes just as communities in Massachusetts and Rhode Island, where

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<v Speaker 14>you're dealing with warnings and another day of heavy rain

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<v Speaker 14>that opened up sinkholes and brought devastating flooding to several communities.

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<v Speaker 14>The National Hurricane Center issued a hurricane watch for portions

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<v Speaker 14>of Maine. Tropical storm watch was issued for a large

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<v Speaker 14>area of coastal New England from parts of Rhode Island

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<v Speaker 14>to Stonington, Maine, including Block Island, Martha's Vineyard, and Nantucket.

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<v Speaker 14>The two week long nightmare for residents in southeast Pennsylvania's

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<v Speaker 14>come to an end after an escaped convicted murder Donald Callavacenti,

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<v Speaker 14>was finally apprehended yesterday. Cavalcenty tried to get away as

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<v Speaker 14>officers moved in, crawling at her thick underbrush with a

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<v Speaker 14>loaded rifle, but a Customs and Border Control team released

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<v Speaker 14>a canine named Yoda to capture him.

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<v Speaker 5>The dogs subdued him and team members from both of

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<v Speaker 5>those teams immediately moved in.

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<v Speaker 14>And that's George bivens Or the Pennsylvania State Police. For

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<v Speaker 14>the first time in days, Schools in businesses in the

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<v Speaker 14>area will reopen. Florida, Gavin around de Santa says it

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<v Speaker 14>was unlikely Republican front runner' Donald Trump could win the

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<v Speaker 14>White House if he's convicted in his criminal trials.

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<v Speaker 12>I think the.

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<v Speaker 9>Chance of getting elected president after being convicted of a

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<v Speaker 9>felony is as close to zero as you can get.

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<v Speaker 14>DeSantis was interviewed on the CBS Evening News with Nora O'Donnell.

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<v Speaker 14>The US and Iran are said to exchange prisoners as

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<v Speaker 14>early as Monday. This is an agreement that's seen as

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<v Speaker 14>the first step toward fresh talks to reimpose limits on

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<v Speaker 14>the country's nuclear program. The deal which also saw the

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<v Speaker 14>US allow Ran to access six billion dollars in funds

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<v Speaker 14>that were frozen. It's already open. President Biden up to

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<v Speaker 14>criticism that he's encouraging more hostage taking and shouldn't be

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<v Speaker 14>doing any sort of deal with the regime. Global News

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<v Speaker 14>twenty four hours day. We're powered by more than twenty

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<v Speaker 14>seven hundred journalists and analysts in more than one hundred

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<v Speaker 14>and twenty countries. I'm John Tecker. This is Bloomberg Karen.

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<v Speaker 2>All right, John, thank you. It's time now for the

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<v Speaker 2>Bloomberg Sports Update. And here's John Stashower, John Karen.

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<v Speaker 13>The first team to clincher spot in the baseball postseason,

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<v Speaker 13>a team that has now been there sixth straight years.

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<v Speaker 15>Ready with her two to two Here it comes, got

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<v Speaker 15>him swinging strike three and the Braves are National League's

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<v Speaker 15>champions for the sixth year in a row.

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<v Speaker 14>What an amazing era.

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<v Speaker 15>We're in the Midstone as it has been a six

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<v Speaker 15>year run of dominance in the East and the Braves

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<v Speaker 15>can celebrate right here in Philadelphia on the Phillies home fields.

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<v Speaker 13>Six eighty am. The fan had the call Braves beating

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<v Speaker 13>the Phillies four to one. The Braves are ninety six

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<v Speaker 13>and fifty and Spencer Streider is seventeen and five. He

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<v Speaker 13>got the win in the clinching victory. Nationals lost in

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<v Speaker 13>Pittsburgh seven to six. The Orioles, shut out at home

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<v Speaker 13>by the Cardinals, won to nothing and lost ground to

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<v Speaker 13>Tampa Bay, who won its game. Red Sox reigned out

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<v Speaker 13>with the Yankees at Fenway Park doubleheader today. Giants at

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<v Speaker 13>ten in in win over Cleveland six to five. They

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<v Speaker 13>were down five to one and the second even. They

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<v Speaker 13>tie the game out of JD. Davis three wing homer

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<v Speaker 13>the eighth Anny. The A's lost in Houston six to

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<v Speaker 13>two and a big win for the Texas Rangers. They

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<v Speaker 13>suddenly won five in a row. I'm Jordan Montgomery and

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<v Speaker 13>three home runs. They won ten to nothing at Toronto.

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<v Speaker 13>Week two in the NFL begins tonight with Minnesota at Philadelphia,

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<v Speaker 13>two NFC Division winners. Last year that the Vikings lost

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<v Speaker 13>their first playoff game, and the Eagles, of course made

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<v Speaker 13>it to the Super Bowl. They're without a couple of

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<v Speaker 13>players tonight injured can have gained well, the running back

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<v Speaker 13>and cornerback James Bradberry John Stash. That were Bloomberg.

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<v Speaker 12>Sports from coast to coast, from New York to San Francisco,

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<v Speaker 12>Boston to Washington, DC, nationwide on Syrias, XAM, the Bloomberg

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<v Speaker 12>Business app, and Bloomberg dot Com. This is Bloomberg Daybreak.

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<v Speaker 14>Good morning.

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<v Speaker 3>I'm Nathan Hager, and we are counting down to a

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<v Speaker 3>couple of key events that could have ripple effects for markets.

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<v Speaker 3>Midnight tonight is when an auto workers strike could begin

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<v Speaker 3>in Detroit, and at the opening bell this morning, British

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<v Speaker 3>chip designer Armhold Holdings makes its US debut on the

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<v Speaker 3>Nasdaq in Wall Street's biggest IPO of the year. Covering

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<v Speaker 3>it all for US is Bloomberg's Critty Gupta and Critties

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<v Speaker 3>with me now, Critty, good morning. Start with the strike deadline.

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<v Speaker 3>We did hear from the United Autoworkers president last night

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<v Speaker 3>and the CEO of Ford as well. Where do things

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<v Speaker 3>stand in the negotiations.

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<v Speaker 16>Yeah, it's looking like it's going to be kind of

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<v Speaker 16>that eleventh hour deadline or basically that you're going to say,

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<v Speaker 16>because look, we are literally counting down less than twenty

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<v Speaker 16>four hours before the contract that, by the way, is

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<v Speaker 16>a multi year contract completely expires. We're not making much progress, Nathan,

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<v Speaker 16>And that's really the concern for a lot of carmakers

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<v Speaker 16>around the world actually, and not just in the States

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<v Speaker 16>as well, because of course this is going to specifically

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<v Speaker 16>impact the auto workers that are in Detroit. The Big

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<v Speaker 16>three or four GM and Stalant is representing about one

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<v Speaker 16>hundred and fifty thousand people. But ultimately, look what it

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<v Speaker 16>does to the other car makers around the world. Mercedes

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<v Speaker 16>Benz for example, being very very vocal about this, saying, look,

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<v Speaker 16>this is going to have industry wide ramifications. And Nathan,

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<v Speaker 16>the logic here is very simple. If you don't have

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<v Speaker 16>these union workers, if they are striking one hundred and

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<v Speaker 16>fifty thousand, suddenly the price of labor for those who

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<v Speaker 16>are not in the union goes up significantly, not just

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<v Speaker 16>for the Big Three, but for all the car makers.

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<v Speaker 16>And that's going to ultimately feed into consumer prices. And

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<v Speaker 16>that's a thing at a time when a lot of

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<v Speaker 16>carmakers are really having a hard time selling their cars.

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<v Speaker 3>Now we've talked about the potential damage that this could

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<v Speaker 3>do to the US economy, the idea that Michigan could

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<v Speaker 3>even enter a recession if this strike lasts for just

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<v Speaker 3>a few days. Are we seeing any give from either

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<v Speaker 3>the union or the automakers on their offers.

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<v Speaker 6>We saw a little bit of give from the union.

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<v Speaker 16>They did lower their pay demand from about forty percent,

0:11:40.600 --> 0:11:43.480
<v Speaker 16>but it's going from about forty six percent to about

0:11:43.480 --> 0:11:45.520
<v Speaker 16>thirty six percent when you kind of compound it for

0:11:46.080 --> 0:11:48.440
<v Speaker 16>a lot of the other benefits that they have. But

0:11:48.800 --> 0:11:50.760
<v Speaker 16>keep this in mind, at the end of the day,

0:11:50.800 --> 0:11:53.200
<v Speaker 16>they are basically trying to use the same playbook that

0:11:53.280 --> 0:11:56.960
<v Speaker 16>UPS had used. The problem is this is not UPS

0:11:56.960 --> 0:12:00.120
<v Speaker 16>and Teamsters. It's a very different industry with a lot

0:12:00.240 --> 0:12:04.280
<v Speaker 16>more workers available that UPS had. The ramifications are small

0:12:04.360 --> 0:12:07.560
<v Speaker 16>or relative to UPS, but obviously still quite a big deal.

0:12:07.559 --> 0:12:08.160
<v Speaker 6>So right now it.

0:12:08.080 --> 0:12:10.280
<v Speaker 16>Looks like the union is kind of on the defensive.

0:12:10.360 --> 0:12:12.440
<v Speaker 16>You aren't seeing a ton of give from the carmakers

0:12:12.480 --> 0:12:16.080
<v Speaker 16>at the moment. For GMS, delants all united in that front.

0:12:16.160 --> 0:12:17.800
<v Speaker 16>But look, anything can happen.

0:12:18.480 --> 0:12:22.120
<v Speaker 3>Before the strike deadline. We're waiting for ARM Holding's debut

0:12:22.240 --> 0:12:26.400
<v Speaker 3>on the Nasdaq. Looks like SoftBank, the company's owner is

0:12:26.520 --> 0:12:29.160
<v Speaker 3>getting pretty much what it wanted from the IPO.

0:12:29.679 --> 0:12:32.040
<v Speaker 16>Yeah, they're about to make a pretty penny out of

0:12:32.040 --> 0:12:33.880
<v Speaker 16>this entire deal. But I got to say, we've really

0:12:33.920 --> 0:12:36.839
<v Speaker 16>got to watch the valuations here because what's significant is

0:12:36.880 --> 0:12:40.079
<v Speaker 16>that initially, when this IPO was first marketed, it was

0:12:40.120 --> 0:12:43.240
<v Speaker 16>the expectation was about sixty to seventy billion dollars is

0:12:43.280 --> 0:12:45.319
<v Speaker 16>what the IPO would be. That is coming down to

0:12:45.360 --> 0:12:47.480
<v Speaker 16>about four point eighty seven billion. We'll call it five

0:12:47.480 --> 0:12:51.880
<v Speaker 16>billion dollars to be generous here. The questioning around that valuation.

0:12:52.040 --> 0:12:54.120
<v Speaker 16>The initial thought is, well, perhaps that means that the

0:12:54.440 --> 0:12:57.800
<v Speaker 16>arm demand isn't as strong, even though now you are,

0:12:57.800 --> 0:13:00.000
<v Speaker 16>of course seeing orders about ten times subscribed. According to

0:13:00.040 --> 0:13:03.040
<v Speaker 16>Bloomberg reporting on the flip side, note that this is

0:13:03.120 --> 0:13:05.120
<v Speaker 16>kind of what happens with IPOs when you look at

0:13:05.120 --> 0:13:07.760
<v Speaker 16>the banking process here, it is very normal for bankers

0:13:07.800 --> 0:13:10.800
<v Speaker 16>to underprice the IPO so that when it actually debuts

0:13:11.000 --> 0:13:14.040
<v Speaker 16>the price skyrockets. The question is does it stay there

0:13:14.160 --> 0:13:15.280
<v Speaker 16>at the end of the day. You've seen this with

0:13:15.320 --> 0:13:19.959
<v Speaker 16>a lot of major tech IPOs Airbnb, door Dash among others,

0:13:20.400 --> 0:13:22.800
<v Speaker 16>and ultimately when and so happening is in that process

0:13:22.840 --> 0:13:24.880
<v Speaker 16>and a few months later, the stock ends up dropping

0:13:24.880 --> 0:13:27.120
<v Speaker 16>pretty significantly. A lot of folks are saying, this is

0:13:27.160 --> 0:13:30.320
<v Speaker 16>not like every other tech ipo, but there's there's the

0:13:30.320 --> 0:13:31.319
<v Speaker 16>pattern for you and Nathan.

0:13:31.800 --> 0:13:33.400
<v Speaker 3>In the time we have left, we got to talk

0:13:33.400 --> 0:13:38.040
<v Speaker 3>about this hack that affected the casino industry. More than

0:13:38.120 --> 0:13:42.480
<v Speaker 3>one company now apparently dealing with the same cyber attack

0:13:42.520 --> 0:13:44.040
<v Speaker 3>from the same group.

0:13:45.080 --> 0:13:46.640
<v Speaker 6>And a little bit of a scary one.

0:13:46.720 --> 0:13:49.480
<v Speaker 16>Nathan that the name of the group behind both attacks

0:13:49.600 --> 0:13:53.640
<v Speaker 16>is Scattered Spider, otherwise known as u NC three nine

0:13:53.880 --> 0:13:56.960
<v Speaker 16>four four. According to the people, basically, it's a group

0:13:57.000 --> 0:13:59.960
<v Speaker 16>of social engineers that are trying to gain access to

0:14:00.080 --> 0:14:03.880
<v Speaker 16>fairly large corporate networks, and to your point, very successfully.

0:14:03.880 --> 0:14:07.280
<v Speaker 16>Caesars Entertainment MGM resorts are just some to the point

0:14:07.280 --> 0:14:10.160
<v Speaker 16>that Caesars Entertainment had to pay tens of millions of

0:14:10.240 --> 0:14:14.000
<v Speaker 16>dollars to the hackers. MGN as well had to pay

0:14:14.040 --> 0:14:16.120
<v Speaker 16>a pretty significant amount. Now, of course, this is something

0:14:16.160 --> 0:14:19.000
<v Speaker 16>that we've been talking about. There have been worries about cybersecurity,

0:14:19.120 --> 0:14:20.880
<v Speaker 16>not just for the casinos.

0:14:20.400 --> 0:14:21.880
<v Speaker 6>In the States, but around the world.

0:14:21.920 --> 0:14:24.080
<v Speaker 16>Remember, a lot of these casino makers have or casino

0:14:24.880 --> 0:14:29.400
<v Speaker 16>sorry owners have massive presences in Macau among other places

0:14:29.440 --> 0:14:31.560
<v Speaker 16>as well, and cybersecurity has been something that they and

0:14:31.600 --> 0:14:34.720
<v Speaker 16>their Earnings calls have been spending a lot of money on.

0:14:34.760 --> 0:14:37.240
<v Speaker 16>What's interesting here is that usually when you look at hackings,

0:14:37.480 --> 0:14:42.560
<v Speaker 16>they're asking to be paid in cryptocurrency, specifically if it's ransom.

0:14:42.920 --> 0:14:46.040
<v Speaker 16>Sometimes they'll use things like locking up computer files, they'll

0:14:46.040 --> 0:14:48.600
<v Speaker 16>do asking for decryption keys. There's a lot of different

0:14:48.600 --> 0:14:51.880
<v Speaker 16>ways this goes. This seems to be a very specific

0:14:52.200 --> 0:14:54.160
<v Speaker 16>type of hack and of course putting a lot of

0:14:54.160 --> 0:14:55.480
<v Speaker 16>the community on edge.

0:14:58.000 --> 0:15:01.040
<v Speaker 1>This is Bloomberg day Break Today morning brief on the

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<v Speaker 6>And I'm Karen Moscow.

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<v Speaker 2>Join us again tomorrow morning for all the news you

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<v Speaker 2>and then