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Speaker 1: Good morning.

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Speaker 2: It's Tuesday, the twenty third of January here in London.

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Speaker 2: This is the Bloomberg Daybreak you at podcast.

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Speaker 3: I'm Caroline Hipkiff and I'm Stephen Carroll. Coming up today,

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Speaker 3: The UK and US launch fresh strikes on Hoothy targets

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Speaker 3: and Yemen as attacks on Red Sea shipping continue.

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Speaker 2: China looks to stabilize its slumping stock market with up

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Speaker 2: to two hundred and seventy eight billion dollars.

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Speaker 3: And Moody's finds red flags in the suspiciously old age

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Speaker 3: of thousands of company directors, with one listed as being

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Speaker 3: nine hundred and forty two years old.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 3: The US and UK have launched new air strikes on

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Speaker 3: Houthy targets and Yemen. It's the eighth and most significant

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Speaker 3: wave of attacks so far in efforts to stop the

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Speaker 3: militant group from disrupting commercial shipping in the Red Sea.

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Speaker 3: Two days ago, US Deputy National Security Advisor John Feiner

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Speaker 3: said the strikes were aiming for weapons stockpiles, but the.

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Speaker 4: Purposes here go well beyond de terms. We are also

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Speaker 4: are seeking to degrade the huti's ability to continue launching

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Speaker 4: these attacks. They have stockpiles of advanced weapons provided to

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Speaker 4: them in many cases or enabled to them in many

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Speaker 4: cases by Iran, and we are taking down taking out

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Speaker 4: these stockpiles.

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Speaker 3: Two senior US officials told Bloomberg. These later strikes significantly

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Speaker 3: reduce the hoothi's ability to attack.

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Speaker 2: Ships staying in the Middle East. Israel's ground forces have

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Speaker 2: advanced deeper into southern Gaza, with intense fighting near humanitarian zones.

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Speaker 2: The offensive comes as the country faces international pressure and

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Speaker 2: a court case accusing it of genocide. The EU's Foreign

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Speaker 2: policy chief, just At Burrell is pushing for a two

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Speaker 2: state solution.

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Speaker 5: I think the more death, more destruction, more hardship for

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Speaker 5: the Gaza people, for the Parisidian people, will not help

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Speaker 5: to defeat Hamas or to the ideology it will love

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Speaker 5: bring more security to Israel well on the contrary, and

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Speaker 5: that's why we need to double a by effort with

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Speaker 5: international partners to move from this deadly confrontation towards a solution.

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Speaker 2: Joseph As Burrell represents European states who are increasingly frustrated

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Speaker 2: with Israel's rejection of a Palestinian state.

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Speaker 3: Chinese authorities are considering measures to stabilize their slumping stock market.

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Speaker 3: According to people familiar with the matter, policymakers are trying

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Speaker 3: to mobilize the equivalent of two hundred and seventy eight

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Speaker 3: billion dollars mainly from the offshore accounts of Chinese state

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Speaker 3: owned enterprises. The money is that intended to become part

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Speaker 3: of a stabilization fund to buy shares on shore through

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Speaker 3: the Hong Kong Exchange link. Goldman Sachs China economist Whui

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Speaker 3: Shan says stock market underperformance could harm the economy.

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Speaker 6: A lot of people ask us about a wealth of actor. Right,

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Speaker 6: if individuals are holding stock, their stock value decline is

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Speaker 6: going to hurt a consumption. But in China, we have

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Speaker 6: found that the wealth of fact is not that. The

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Speaker 6: main effect on consumption is income, if people need to

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Speaker 6: have income to consume. So what we do worry about

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Speaker 6: is a sentiment and confidence impact, kind of a reinforcement

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Speaker 6: market going down, reinforcing the barriers to sentiment. I think

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Speaker 6: that might be a bigger channel in terms of affecting growth.

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Speaker 3: We Shune from Goldbin Sachs were speaking as some policy

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Speaker 3: measures could come as soon as this week, as officials

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Speaker 3: continue to weigh options. A sell off that sent the

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Speaker 3: benchmark CSI three hundred index to a five year low

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Speaker 3: this week is increasing pressure on policymakers to act.

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Speaker 2: The Bank of Japan is keeping its negative rate for

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Speaker 2: the time being. Policymakers maintained the bank's negative one tenth

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Speaker 2: of one percent short term rate and kept yield curve

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Speaker 2: control parameters intact after a two day meeting. Fidelity International's

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Speaker 2: Asia economists Pekwan Liu, says that future policy changes will

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Speaker 2: be dependent on a number of factors.

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Speaker 7: I think the bog might starts policy normalization in April meeting.

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Speaker 7: Three things needs to happen for us to say more

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Speaker 7: confidently that April will be the month that they start

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Speaker 7: on policy normalization. Firstly, we need to see more evidence

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Speaker 7: on wage growth. Secondly, there will be a ton Con

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Speaker 7: survey that's been released in early April, which will give

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Speaker 7: us some evidence to see the corporate behavior and corporate

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Speaker 7: expectations of inflation. And lastly, between now and April meeting,

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Speaker 7: nothing significant is happening on the political front domestically to

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Speaker 7: derail the path of Japan's cyclical recovery.

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Speaker 2: News comments are consistent with the Coonovists surveyed by Bloomberg,

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Speaker 2: who also think that an end to negative rates is

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Speaker 2: most likely to come in the spring. Following the decision,

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Speaker 2: the yen initially weakened against the US dollar before retracing losses.

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Speaker 3: Bill Gross, the man once dubbed the bond King, has

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Speaker 3: some advice for the FED. Stop winding down your balance

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Speaker 3: sheet and start cutting rates if you want to avoid

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Speaker 3: a recession. Speaking to Bloomberg, the co founder and former

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Speaker 3: chief investment officer of peenco at this message for policymakers

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Speaker 3: at the Central Bank.

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Speaker 8: I would stop quantitative tightening. I think that's just not

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Speaker 8: a correct philosophy and policy at this point in time.

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Speaker 8: To continue to tighten quantitatively, they should leave the reserve

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Speaker 8: balance around seven trillion dollars and just see what happens

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Speaker 8: going forward. I also think that yes, the Fed should

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Speaker 8: lower interest rates over the next six to twelve months.

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Speaker 8: Real interest rates are simply too high. The ten year

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Speaker 8: real interest rate is one point eight percent, which historically

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Speaker 8: is very restrictive.

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Speaker 3: Bill Gross's comments come as Wall Street remains keenly focused

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Speaker 3: on when exactly the Fed will start trimming the benchmark

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Speaker 3: interest rate. Last month, policymakers projected seventy five basic points

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Speaker 3: of cuts in twenty twenty four. According to that median forecast.

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Speaker 2: The hack on these Securities and Exchange Commissions X account,

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Speaker 2: which premature tuly announced the approval of a spot Bitcoin ETF,

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Speaker 2: was achieved by hacking and hijacking rather a staff member's phone.

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Speaker 2: In its most detailed statement yet on the ongoing probe

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Speaker 2: into the incident, the SEC said that an employee's phone

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Speaker 2: was targeted in a so called sim swap attack. This

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Speaker 2: involves a scammer convincing the telecom carrier to transfer the

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Speaker 2: phone number to a SIM card that they control. The

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Speaker 2: regulator says it has now enabled multi factor authentication on

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Speaker 2: all its social media accounts.

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Speaker 3: Moody's Analytics has found twenty one million red flags for

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Speaker 3: financial crime, and Britain is one of the worst offenders,

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Speaker 3: with one point six trillion dollars laundered annually. The ratings

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Speaker 3: firm examined close to half a billion companies in November

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Speaker 3: for a warning signs. Bloombergs James Wilcock has more.

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Speaker 9: The retirement age keeps getting older, but for Moody's a

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Speaker 9: listed director, that's more than one hundred and twenty three

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Speaker 9: years old, it's a step too far. In fact, one

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Speaker 9: listed director at nine hundred and forty two years old,

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Speaker 9: would have been born in the eleventh century. More than

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Speaker 9: two two hundred companies have directors older than any recorded human.

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Speaker 9: It's all part of a report by Moodies looking into

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Speaker 9: shell companies used for financial crime. Other common tells include dormancy,

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Speaker 9: circular ownership, or gbous addresses, with more than two thousands

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Speaker 9: being located in Egypt's pyramids. But for the UK, the

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Speaker 9: report raises troubling questions, with nearly a quarter of all

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Speaker 9: red flags globally being found in Britain's registers in London.

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Speaker 9: James Wilcock Bloomberg Radio.

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Speaker 3: Now, in a moment we'll bring you on more on

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Speaker 3: the latest moves in the Chinese stock markets. But first

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Speaker 3: of Bloomberg headline that caught Meyer this morning, No frills

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Speaker 3: flying emerges as air travels painful greener future. So this

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Speaker 3: is a look at the carbon impact from flying. That's

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Speaker 3: lesser on low cost carriers because they're very fixed on

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Speaker 3: reducing the weight by using lighter seats and having more

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Speaker 3: passengers on each flight, versus those business class seats that

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Speaker 3: are heavier take up more boom means you don't get

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Speaker 3: as many passengers, which means their individual carbon emissions per

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Speaker 3: kilameter traveled are much higher. So this is These are

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Speaker 3: rankings coming from a company called vest Global, and they

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Speaker 3: found that the five airlines that emit the least or

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Speaker 3: the fewest pollutants per passenger are all low cost carriers.

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Speaker 3: Just for one example, the least polluting on their rankings

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Speaker 3: is whiz Air, which is almost half of the emissions

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Speaker 3: that you'd see from British airways for example.

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Speaker 2: Well, I was quite surprised by that because in some

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Speaker 2: senses you might think that the low cost carriers would

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Speaker 2: burn more fuel because they're go short distances and burning

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Speaker 2: a lot of fuel as they go up and come

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Speaker 2: down again. But actually it's not quite true because all

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Speaker 2: to do with the weight of it. Hence why it's

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Speaker 2: called travels painful future, because it's cramming all of us

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Speaker 2: onto smaller planes. Having said that, no train alternative.

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Speaker 1: Is that it.

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Speaker 3: I did have a quick look at what Eurostar's grams

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Speaker 3: per grams of carbon per kilameter are five point five.

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Speaker 3: This is the lowest ranking air lane, which is about

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Speaker 3: fifty five. So I mean you're it's a pretty big difference,

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Speaker 3: and probably not flying at all would be much better

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Speaker 3: for the environment, or at least flying an awful lot

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Speaker 3: less than we currently do.

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Speaker 2: Okay, that's what I'm stall on the Bloomberg terminal to

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Speaker 2: have a read of this morning. Beijing is considering state

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Speaker 2: intervention to stabilize a stock market route. According to people

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Speaker 2: familiar with the matter, policymakers are looking to mobilize the

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Speaker 2: equivalent of Childred's seventy eight billion dollars to buy shares

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Speaker 2: on shore and restore investor confidence. Joining us now to

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Speaker 2: discuss this Bloomberg Opinion coconomists, Daniel Mask Daniel, thanks for

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Speaker 2: being with us. Just tell us about exactly what this

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Speaker 2: plan is and why policymakers are attempting to buy stocks now.

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Speaker 8: Well.

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Speaker 1: According to people familiar with the matter who spoke to

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Speaker 1: our colleagues at Bloomberg News, the authorities are considering a

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Speaker 1: package of measures, the most important characteristic of which is

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Speaker 1: state or state backed funds will bring money home to

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Speaker 1: China and buy Chinese stocks. So when you talk about

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Speaker 1: a government rescue of the stock market on the basis

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Speaker 1: of what we're seeing here, that is literally what it is.

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Speaker 1: State capitalism beautiful.

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Speaker 3: Will it work short term? Is there enough money behind it?

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Speaker 3: And does the strategy look like it will shore up

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Speaker 3: the markets that they aim to.

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Speaker 1: In the short term. Rescue packages like this, whether it's

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Speaker 1: China or what we saw from other East Asian countries

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Speaker 1: during the financial crisis of the late nineties and again

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Speaker 1: in two thousand and seven to two thousand and nine,

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Speaker 1: yes there will be a short term effect. The other

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Speaker 1: thing to consider is people who investors who wish to

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Speaker 1: have cordial relations with the government will see what the

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Speaker 1: state linked funds are doing and they'll say, yeah, I

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Speaker 1: better get a piece of that too. So in the

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Speaker 1: short term, yes, it will work. But the really interesting

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Speaker 1: point is like, what's underneath this? Why is this needed?

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Speaker 1: The fundamental problem for China right now is that the

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Speaker 1: economic recovery since the dismantling of COVID zero has been

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Speaker 1: so underwhelming relative to expectations that we are seeing a

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Speaker 1: shift in the way people now think about China. All

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Speaker 1: the problems challenges that have been building up for the

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Speaker 1: better part of a decade, but people didn't really seem

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Speaker 1: to pay that much attention to because hey, there was

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Speaker 1: great growth. You know, these things are now very much

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Speaker 1: in the foreground. People are looking for reasons to be

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Speaker 1: negative on China. There is a bull market for bad

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Speaker 1: news is in China. On a more proximate basis, the

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Speaker 1: GDP numbers we saw released last week, Sure China meant

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Speaker 1: its growth target of about five percent, but you know,

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Speaker 1: twenty four hours hadn't gone past, and people are taking

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Speaker 1: a part the component numbers and saying, wait, this does

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Speaker 1: not add up. Perhaps growth was as little as one

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Speaker 1: percent or two percent, a far cry from five percent.

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Speaker 1: So where in a moment where it's kind of like Japan,

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Speaker 1: you know, after the nineteen nineties, no one wanted to

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Speaker 1: hear anything good about it.

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Speaker 2: Really interesting, Daniel, thank you so much for being with

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Speaker 2: us this morning. Bloomberg Opinion columnist Daniel Moss then on

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Speaker 2: that plan by Chinese authorities, a package of measures to

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Speaker 2: stabilize the slumping stock market. Now to Israel, though, where

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Speaker 2: a profound change has happened since the October seventh Hamas

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Speaker 2: attack and the ensuing invasion of Girlza. Now it appears

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Speaker 2: Israel is committed to a war in Girlza at all costs,

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Speaker 2: seeing an existential threat to the nation. This is what

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Speaker 2: Bloomberg's Israel Buier chief Ethan Brauner, has been writing about

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Speaker 2: this morning, and he joins us. Now, Ethan, thanks for

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Speaker 2: being with us. You've been writing about how Israel has

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Speaker 2: been unusually incredibly united in seeing and perceiving this existential threat,

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Speaker 2: a consensus therefore about the war despite Palestinian deaths.

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Speaker 10: Yes, that's right. I mean I wrote it because it

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Speaker 10: seemed to me that abroad people didn't understand, because they

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Speaker 10: were understandably watching all the deaths and suffering in Gaza

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Speaker 10: and figuring, given this sort of asymmetric nature of this conflict,

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Speaker 10: that Israel is sort of strong and sort of out

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Speaker 10: there feeling strong about itself. But in fact, inside this

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Speaker 10: country what you feel is an enormous sense of vulnerability,

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Speaker 10: in a sense that these militias like Hamas and Hubelah

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Speaker 10: on its borders, fed and trained by Iran, are actually

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Speaker 10: a deep threat. And that's what has created the sense

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Speaker 10: of unity and this sense of vulnerability.

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Speaker 3: How is that vulnerability manifesting itself in people's lives? Is

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Speaker 3: it simply the security situation or is there an economic

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Speaker 3: aspect to it as well?

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Speaker 10: Both things are true. I begin the piece with several

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Speaker 10: sort of cultural examples. You know that what people are

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Speaker 10: are listening to and reading and watching has become much

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Speaker 10: more focused on suffering and vulnerability. So that's one thing.

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Speaker 10: But indeed, I mean, you know, from the first day,

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Speaker 10: several hundred thousand reservists were a called to the fronts,

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Speaker 10: both the north and the south, and that meant a

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Speaker 10: lot of companies had to stop. Palestinian workers up. Two

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Speaker 10: hundred thousand of them are not in the country now

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Speaker 10: because of this, also this sense of fear, and so

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Speaker 10: construction sites where they mostly work are shut down. So

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Speaker 10: the fourth quarter of twenty twenty three is projected to

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Speaker 10: drop nineteen percent in terms of GDP, and you know

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Speaker 10: there'll be an ongoing cost and so far everyone understands

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Speaker 10: that a strong economy is important, but fundamentally they are

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Speaker 10: united on the importance of continuing to fight.

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Speaker 2: Is also rethinking international relations because of the global reaction

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Speaker 2: to the Hamas attack. Is this a bunker mentality.

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Speaker 10: Well, on some level it is. Absolutely. There are country

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Speaker 10: feels that the world has not fully understood what it

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Speaker 10: went through and what it faces and the sense internally

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Speaker 10: and you know, one point I make in the piece

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Speaker 10: as well is that these things can shift, but so

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Speaker 10: far they have it fundamentally. But internally the feeling is

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Speaker 10: if we need to go it alone, we will.

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Speaker 3: Is there? What acknowledgment is there though, of the sentiment

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Speaker 3: that's being expressed in many other parts of the world.

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Speaker 3: That's you know, the loss of life in Gaza is huge,

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Speaker 3: and what's the perception of that within Israel?

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Speaker 10: So this is a very good question and the answer

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Speaker 10: is that there's not a fair not much attention being

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Speaker 10: paid to it here. It doesn't get much focus and

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Speaker 10: the media, and you know, some people will say, look,

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Speaker 10: as indeed, it's terrible, but it's the fault of Hamas

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Speaker 10: because they have ingrained themselves into the civilian population and

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Speaker 10: for us to take apart their war machine, this is

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Speaker 10: what happens. But you know, the sort of public assertion

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Speaker 10: is this is terrible, we aren't happy about it, but

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Speaker 10: it's not going to make a difference in how we proceed.

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Speaker 2: Talking about the conflict within the region. More US and

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Speaker 2: UK s strikes again hoothy targets in Yemen is now

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Speaker 2: the eighth strike on Monday in twelve days. So this

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Speaker 2: is another flashpoint in the region, but it doesn't seem

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Speaker 2: to be having a huge effect in terms of red

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Speaker 2: sea transit at the moment. How are you thinking about

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Speaker 2: what's going on with Yemen and the Hoothys.

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Speaker 10: Well, I think that it could well though. I mean,

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Speaker 10: one of the reasons you see the US and UK

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Speaker 10: is so quick to be attacking hooty sites is because

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Speaker 10: the concern of seafaring is enormous and people are having

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Speaker 10: to go around the Africa and so on and start

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Speaker 10: switching to trucks. So I think that this is a

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Speaker 10: very big deal and could turn of course into something

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Speaker 10: bigger because the uties like Hamas and his Belah are

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Speaker 10: of course trained by and funded by Iran, So all

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Speaker 10: of this has a big regional component, and I think

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Speaker 10: that the region has not been this tense in many years.

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Speaker 10: There's in many ways anything could sort of blow, and

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Speaker 10: that of concern to the entire world, not just to

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Speaker 10: those who live here.

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