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Speaker 1: Bloomberg Audio Studios, Podcasts, radio News. This is Bloomberg Daybreak Weekend,

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Speaker 1: our global look at the top stories in the coming

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Speaker 1: week from our Daybreak anchors all around the world. Straight

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Speaker 1: ahead on the program, and look ahead to the August

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Speaker 1: Jobs Report in the US what it could mean to

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Speaker 1: Fed policy moving forward. I'm Tom Busby in New York.

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Speaker 2: I'm Stephen Carolyn London, where we're discussing the challenges facing

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Speaker 2: the UK's government as Parliament returns from at summer break.

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Speaker 3: I'm deg Christner previewing a major semiconductor conference in Taiwan.

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Speaker 4: That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg

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Speaker 2: Good day to you.

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Speaker 1: I'm Tom Busby. We begin today's program with the August

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Speaker 1: Jobs Report out this Friday, and what it could mean

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Speaker 1: for the Federal Reserve at its September meeting for more.

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Speaker 1: We're joined by Michael McKee, Bloomberg International Economics and Policy correspondent, Well, Michael,

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Speaker 1: inflation steadily cooling, the US labor market carrying a lot

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Speaker 1: more weight with the FOMC for its next meeting now

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Speaker 1: less than two weeks away. What do you expect to

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Speaker 1: see in this August jobs report and what will all

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Speaker 1: of it mean to the FED?

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Speaker 5: Well, it's important to the Fed. At his Jackson Hole comments,

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Speaker 5: jaypoul FED chairman said that the risks have tilted now

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Speaker 5: towards a weakening labor market away from strengthening inflation, and

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Speaker 5: inflation as we saw on Friday's PCE index still very contained,

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Speaker 5: still continuing to slowly moved down towards their two percent target.

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Speaker 5: So they're keeping an eye on the labor market in

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Speaker 5: part because it's the one thing that they don't have

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Speaker 5: a lot of data ahead of time until this coming week.

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Speaker 5: Because we will get the ADP numbers, will get the

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Speaker 5: ISM manufacturing and services hiring numbers, we get the latest

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Speaker 5: jobless claims numbers and jolts. All of those things in

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Speaker 5: one week are all the precursors to Friday's labor market report.

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Speaker 5: Right now, what we're tentatively expecting is as sort of

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Speaker 5: a return of job growth. That last month was one

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Speaker 5: hundred and fourteen thousand. The feeling is we'll go back

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Speaker 5: up to somewhere between one hundred and fifty and two

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Speaker 5: hundred thousand. It's not going to be as strong as

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Speaker 5: it was, but it's still going to be a fairly

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Speaker 5: strong number. The most interesting thing is going to be

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Speaker 5: the unemployment rate, because a lot of economists think that's

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Speaker 5: going to go down to four point two percent. The

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Speaker 5: four point three percent we saw in July was sort

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Speaker 5: of a one off, accidental increase and that will change

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Speaker 5: and if that's the case, that'll make the FED feel better.

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Speaker 1: I mean, we have been seeing evidence a bit of

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Speaker 1: a slow down despite what we think will be you know,

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Speaker 1: four point two percent unemployment rate, the weekly jobless claims

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Speaker 1: fluctuating kind of up and down, but still actually historically

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Speaker 1: very strong, though right very low.

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Speaker 5: They've been so low for so long, with the exception

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Speaker 5: of the weirdness of the pandemic, that it's hard to

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Speaker 5: get an exact idea of where it is.

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Speaker 1: You have to be worried.

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Speaker 5: It used to be in the three hundred to four

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Speaker 5: thousand range. Now we're in the two hundred, the low

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Speaker 5: two hundreds that have been other than that one brief

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Speaker 5: period for so long that even when they go up,

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Speaker 5: people get a little nervous, But it doesn't appear that

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Speaker 5: it's because anybody's being laid off. In July, we saw

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Speaker 5: an increase because factories were retooling, and we normally see

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Speaker 5: people go on unemployment during those periods. We had the

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Speaker 5: hurricane in Texas, that sort of thing, and that's behind

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Speaker 5: us now and we're seeing still very low jobles claims numbers,

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Speaker 5: and they don't seem to be indicating any problem.

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Speaker 1: Now, let's go back to you talked about the PCEE

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Speaker 1: that came out this past week. Not only did we

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Speaker 1: see inflation continue to edge lower two point five percent

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Speaker 1: was the headline, but also wages and salaries as expected,

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Speaker 1: but spending still better than expected.

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Speaker 5: Spending still better than expected, up half a percent, feeds

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Speaker 5: the narrative of the soft landing. It was up from

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Speaker 5: three tenths the prior month in June. The issue is, though,

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Speaker 5: that the savings rate went down to two point nine percent,

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Speaker 5: first time in the two is except for one month

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Speaker 5: in twenty twenty two. Since the mid two thousands, two

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Speaker 5: thousand and six to two thousand and eight, and it

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Speaker 5: isn't clear how people are going to continue to a

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Speaker 5: for that kind of spending unless wages and salaries continue

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Speaker 5: to grow at a healthy pace. They grew okay, three

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Speaker 5: tenths of percent during the month of July, but at

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Speaker 5: some point you have to wonder when people's spending gets exhausted.

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Speaker 1: The Fed wants to see inflation moving in the right direction.

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Speaker 1: They're seeing the labor market where they want to see.

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Speaker 1: At mid September we have this FED meeting. It looks

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Speaker 1: like a sure thing that a cut is happening. The

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Speaker 1: big question, how big a cut?

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Speaker 5: Yeah, J Powell all but promised a cut in September,

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Speaker 5: So that's likely to happen unless we have some sort

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Speaker 5: of data accident between now and then. The Fed would

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Speaker 5: prefer to do twenty five basis points. That's their history,

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Speaker 5: That's what they consider sort of a normal move. There

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Speaker 5: is a fear that if they did fifty it would

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Speaker 5: suggest there's something wrong with the economy they have to

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Speaker 5: rescue it, and that then the markets would start pricing

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Speaker 5: in more fifty basis point cuts. Now, if we do

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Speaker 5: have a data accident that suggests the economy is significantly weaker,

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Speaker 5: like some bad number from the employment report, then the

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Speaker 5: Fed could go fifty. They've left their options open, but

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Speaker 5: at this point there doesn't seem to be much support

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Speaker 5: for doing that as a base case.

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Speaker 1: And there are still two meetings left.

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Speaker 5: This year, and the markets had been pricing one hundred

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Speaker 5: basis points move one percentage point by the end of

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Speaker 5: the year. That's starting to go out of the numbers

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Speaker 5: as the numbers continue to come in good and so

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Speaker 5: people are basically thinking. People on Wall Street are basically

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Speaker 5: thinking now twenty five at each of those three meetings,

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Speaker 5: and then it will continue into next year. I don't

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Speaker 5: know that it really matters that we say by the

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Speaker 5: end of the year, because they're going to continue cutting

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Speaker 5: as long as they think that they are restrictive. They

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Speaker 5: don't know where neutral is going to be, and they say,

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Speaker 5: we're going to just feel our way along. Do we

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Speaker 5: get there.

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Speaker 1: I want to talk to you about something. The Bureau

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Speaker 1: of Labor Statistics reported this is about two weeks ago,

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Speaker 1: that in the year leading up to this March eight

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Speaker 1: hundred and eighteen thousand fewer jobs than initially reported. How

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Speaker 1: can that happen? Is it the gig economy? Who are

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Speaker 1: these people that they mistakenly counted?

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Speaker 5: Well, a number of factors come into play. One is

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Speaker 5: that there has been a big surgeon immigration, and so

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Speaker 5: there may be people who are being counted in on

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Speaker 5: the payrolls numbers that are not counted in this revision,

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Speaker 5: which looks at unemployment insurance, and if you're an undocumented alien,

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Speaker 5: you're not eligible for unemployment insurance, so companies wouldn't pay.

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Speaker 5: That's one potential explanation. And another is we've seen response

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Speaker 5: rates go down from companies since the pandemic, so they

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Speaker 5: may not be capturing all of those who are at work.

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Speaker 5: And then there could be just the fact that errors

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Speaker 5: are made by a companies sending in their data. The

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Speaker 5: thing about these revisions is, first of all, as you mentioned,

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Speaker 5: they only go through March of this year. It's the

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Speaker 5: year prior to that, and then they get revised again

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Speaker 5: before the data are actually changed, which happens in January.

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Speaker 5: And we have seen in the past when there have

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Speaker 5: been big revisions they sometimes revise much of it away,

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Speaker 5: and just this past week, Goldn Sachs said they thought

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Speaker 5: the eight hundred and eighteen thousand would be revised down

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Speaker 5: to three hundred thousand. I don't know how accurate they

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Speaker 5: are on that, but it just shows you the range.

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Speaker 5: So the Fed is looking past that and they're not

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Speaker 5: concerned at this point that we have a terribly weak

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Speaker 5: job economy.

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Speaker 1: Okay, so a little far back in the rearview mirror.

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Speaker 1: Yes it was March. Okay, the August non farm payrolls

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Speaker 1: out at eight thirty am Wall Street Time on Friday,

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Speaker 1: and our thanks to Michael McKee, Bloomberg International Economics and

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Speaker 1: Policy correspondent. Well, we move now to take a closer

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Speaker 1: look at the IT hardware space. Strong earnings results last

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Speaker 1: week from Dell thanks to sales of its AI servers,

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Speaker 1: also blow out demand last quarter for Nvidia's AI chips.

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Speaker 1: This week, though, we hear from Eulett Packard Enterprise HPE.

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Speaker 1: So how will AI server demand impact HPE's results. For more,

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Speaker 1: we're joined by Wujin Ho, Bloomberg Intelligence Senior technology analyst. Well,

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Speaker 1: wujin let's start with what you expect to see in

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Speaker 1: HPE's earnings this week.

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Speaker 6: The way I'm looking at it right now, I do

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Speaker 6: think with your lead AI servers is probably going to outperform.

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Speaker 6: We've seen that with Dell all performing as well as

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Speaker 6: a super Micro I performing on the AI server side,

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Speaker 6: and I do think that AI servers are going to

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Speaker 6: lift results in the quarter well.

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Speaker 1: HPE a leading provider of server storage, networking, consulting more

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Speaker 1: for business customers. Are businesses still spending big to upgrade

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Speaker 1: and update their AI technology?

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Speaker 6: Yep, so they're not there yet. HPE does have exposure

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Speaker 6: to larger enterprises. From a relative basis, hpe s AI

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Speaker 6: server exposure is much smaller. I think they're gonna do

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Speaker 6: roughly about one point two billion dollars in AI server

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Speaker 6: sales in the fiscal third quarter. Contrast that with Dell

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Speaker 6: was just reported last week they did about three point

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Speaker 6: one billion in sales in AI servers and super Micro

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Speaker 6: did about five point two billion in sales. So, you know,

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Speaker 6: smaller exposure, but they do have a good footprint.

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Speaker 1: It's also got a partnership, right HPE with Nvidia to

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Speaker 1: build a private cloud business. How is that going?

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Speaker 6: Yeah, Look it's still in the early days. It is

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Speaker 6: part of HPE's broader strategy on driving a lot more

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Speaker 6: private cloud and video is trying to look for a

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Speaker 6: better footprint into the enterprise, and this would be a

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Speaker 6: good marriage between HPE and exposing them to and video,

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Speaker 6: exposing them to their insall base as well as HPE

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Speaker 6: having access to in videos GPUs.

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Speaker 1: And I think that's that's good. Almost a decade after

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Speaker 1: it's split with HP HPE, where where is it heading now?

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Speaker 1: Is it more toward those AI servers, is it more

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Speaker 1: towards just AI or or you know, are there legacy

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Speaker 1: businesses that are going to be around for a while

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Speaker 1: with Hpe.

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Speaker 6: Yeah, So if you look at HPE, it's much more

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Speaker 6: than just the AI servers. They are one of the

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Speaker 6: leading server as well as storage vendors out there. One

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Speaker 6: of the things that I am looking for is a

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Speaker 6: general broader IT spending recovery for their server and storage businesses.

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Speaker 6: What I do think is that we are going to

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Speaker 6: start seeing more signs of recovery in both of those businesses. Look,

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Speaker 6: it's it's been in the malaise for the last several quarters,

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Speaker 6: and I do think that you know, with IT spending stabilizing,

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Speaker 6: it's poise for growth for the next couple of quarters.

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Speaker 1: Now you see some growth there. How about on the

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Speaker 1: consumer side, you know, we've seen the business side, the consumer.

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Speaker 1: We know that last week we heard from best Buy

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Speaker 1: they're expecting more sales of PCs, laptops, that type of thing,

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Speaker 1: along with you know, of course they sell a lot

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Speaker 1: of home appliances, but are you seeing evidence of that?

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Speaker 1: Are you seeing more consumer demand?

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Speaker 6: Yeah, and that aligns with more of their sister company, HP,

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Speaker 6: which they split from several years ago, as well as

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Speaker 6: we can glean into those results as well, we are seeing,

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Speaker 6: you know, the uptake in consumer PCs for both HP

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Speaker 6: as well as Dell has not been as strong as

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Speaker 6: one had hoped. I do think it may be a

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Speaker 6: sluggers second half on the consumer PC side. And also

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Speaker 6: if we think about it from a global perspective, we

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Speaker 6: are waiting for a broader global recovery. PC demand I

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Speaker 6: think is going to be muted, but there are some

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Speaker 6: catalysts coming in twenty five, such as AIPCS that could potentially.

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Speaker 1: Help all right. HPE earnings out this Wednesday are thanks

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Speaker 1: to Wujin Hoo, Bloomberg Intelligence Senior technology analyst, and coming

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Speaker 1: up on Bloomberg Day Break weekend, we'll discuss the challenges

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Speaker 1: facing the UK's government as Parliament returns from its summer Break.

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

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Speaker 1: day Break weekend, our global look ahead at the top

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

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Speaker 1: in New York. Up later in our program, Taiwan Semicon

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Speaker 1: Summit kicks off this week and we'll discuss what this

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Speaker 1: means for chip development in that country. But first, the

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Speaker 1: UK's Parliament reconvenes this week, and for new Prime Minister

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Speaker 1: Keir Starmer, after an eventful summer holiday filled with international

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Speaker 1: engagements and settling into life on Downing Street, challenges a

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Speaker 1: wait in Westminster for more, Let's go to London and

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Speaker 1: bring in Bloomberg Daybreak. You're a banker, Stephen.

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Speaker 2: Carroll, Tom Keir Starmer and his new government have been

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Speaker 2: busy this summer, from diplomatic trips abroad to announcing and

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Speaker 2: deenacting new policies. The UK's first labor government in fourteen

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Speaker 2: years seems eager to make its mark. Whilst Parliament has

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Speaker 2: been on summer recess and the Conservative opposition largely fixated

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Speaker 2: on their own leadership election, Starmer and his cabinet have

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Speaker 2: been able to set the narrative. So far. It's been

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Speaker 2: one of considerable caution. The Chancellor Rachel Reeves emphasized the

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Speaker 2: scale of the spending black hole she says her predecessors caused,

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Speaker 2: while the Prime Minister made a speech warning of painful

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Speaker 2: decisions ahead. The supposedly gloomy outlook is something we've been

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Speaker 2: discussing with Philip Collins, former chief speechwriter to Tony Blair.

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Speaker 2: He says it's wise of Starmer to set expectations low.

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Speaker 7: Well, I thought it was a conventional speech in a

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Speaker 7: way to do at this time, in the early days

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Speaker 7: of a government, because it's one things you want to

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Speaker 7: do is to win time by blaming your predecessors. And

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Speaker 7: everybody does a version of this speech. Now it's particularly

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Speaker 7: dramatic because of the riots, and also because the real

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Speaker 7: I would have with this speech is that what Starmer

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Speaker 7: says might be true. It may be that things are

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Speaker 7: going to get considerably worse. I mean, you'd probably say

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Speaker 7: that even if you didn't think they were, because you

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Speaker 7: lower expectations. But I fear that this may be true.

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Speaker 7: And I'm not sure that we didn't already know this

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Speaker 7: was going to come. I think most people thought that

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Speaker 7: whoever had won the general election, there was going to

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Speaker 7: be some difficult decisions to follow, difficult decisions on tax

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Speaker 7: and spending. And so I think in signaling that, although

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Speaker 7: you're right rhetorically there are contradictions all over the place

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Speaker 7: with the campaign which had just gone before and with

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Speaker 7: some of the early words, but taken in isolation, I

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Speaker 7: don't think that message that things are going to be

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Speaker 7: bad and there's going to be something difficult to encounter

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Speaker 7: now will come as a great surprise.

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Speaker 8: When you say sort of, it won't necessarily come as

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Speaker 8: a surprise. What do you glean from what Starmer said

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Speaker 8: that might realistically have changed from what we can expect

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Speaker 8: from Labor in sort of the coming months.

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Speaker 7: Oh, I don't really think anything has particularly changed. I

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Speaker 7: think they always knew that when they look in serious

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Speaker 7: detail at the public finances there were holes there and

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Speaker 7: they'd have to take difficult decisions on tax. So I

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Speaker 7: don't think in one in that sense anything has particularly changed.

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Speaker 7: I mean, the riots, of course, are a major event

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Speaker 7: which have changed the response and have changed the context.

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Speaker 7: But as far as the budget is concerned, I think

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Speaker 7: we are where we are. I mean, and Rachel Reeves

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Speaker 7: gave that really rather dramatic, and I think a little

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Speaker 7: bit exaggerated statement to Parliament about the nature of the

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Speaker 7: public finances and the sort of the fallacies of the

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Speaker 7: information she'd been receiving. So there's been there is a

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Speaker 7: concerted attempt to say, look, this is a really bad

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Speaker 7: state of affairs. We're going to have to do difficult things.

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Speaker 7: It will get worse before it gets better. So again

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Speaker 7: I'm not saying that's a change. I think that's just,

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Speaker 7: in fact, the start realization of what was always there.

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Speaker 8: Well, then to take sort of that idea that maybe

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Speaker 8: the economic reality hasn't changed, but maybe the political context

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Speaker 8: has shifted in some ways. This speech then becomes a

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Speaker 8: challenge of political rhetoric of starma. Can he convince the

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Speaker 8: public and the media that his vision is going to

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Speaker 8: make the country a better place than the long winter?

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Speaker 8: Tie us up in his telling of what the government

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Speaker 8: and the country should be like, do you think he

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Speaker 8: did it?

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Speaker 7: Well, That's exactly the question, I think, because there are

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Speaker 7: two parts to the slogan, aren't there things will get worse,

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Speaker 7: but then the second half is before they get better. Now,

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Speaker 7: it's that second bit that is in fact the really

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Speaker 7: interesting part of it, because I don't think many people

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Speaker 7: would doubt that things are going to get worse. People

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Speaker 7: as a rule think things will get worse anyway. Politically,

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Speaker 7: it's the second part, but before they get better, and

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Speaker 7: there is the promissory note that things will in due

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Speaker 7: course get better, and there's a lot resting on that.

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Speaker 7: That's the thing which here in the end, the political

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Speaker 7: judgment will be on that second part of the slogan.

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Speaker 7: Does the Labor Party have the resources both material and

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Speaker 7: intellectual to change things around? On that? I don't think

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Speaker 7: we know a lot, because the manifesto on which the

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Speaker 7: Labor Party has just run was deliberately thin in policy terms,

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Speaker 7: and I don't think we've seen a great deal since

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Speaker 7: to tell us exactly what will be done to turn

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Speaker 7: things around. So I do think that's exactly politically the

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Speaker 7: question on which the government will be judged.

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Speaker 2: Is exaggeration of risk. Here is this reinforced message which

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Speaker 2: is coming now almost it feels like a drum beat

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Speaker 2: since the election of Oh, things are really terrible financially

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Speaker 2: and we won't be able to do anything, and we

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Speaker 2: you know, everything's going to be very difficult, isn't There

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Speaker 2: is too that people will just tune out and then

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Speaker 2: by the time the good times rolled around, that people

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Speaker 2: won't be ready for that either.

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Speaker 7: There is a risk always of exaggeration, but I would

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Speaker 7: once upon a time I thought that risk was severe.

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Speaker 7: But then I watched George Osborne convince enough people that

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Speaker 7: the global financial crash have been the result of a

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Speaker 7: slight labor overspend, and I thought, oh, dear, well, clearly

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Speaker 7: this works, so the risk is perhaps not all that great.

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Speaker 2: That was former chief speech writer to Tony Blair, Philip Collins,

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Speaker 2: speaking to James Wilcock and me on the Bloomberg UK

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Speaker 2: Politics podcast. So as MP's prepared to head back to Westminster,

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Speaker 2: what sort of questions might wait Keir Starmer at the

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Speaker 2: dispatch box. That's something I've been discussing with Bloomberg's UK

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Speaker 2: Political editor Alex Wickham.

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Speaker 9: The main thing coming down the track is the budget

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Speaker 9: end of October, so we've sort of got a two

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Speaker 9: months run into that where Rachel Reeves, the Chancellor, has

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Speaker 9: her first big opportunity to lay out her tax and

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Speaker 9: spend plans, and it's a huge budget. You've had some

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Speaker 9: pretty big budgets over the last few years, but this

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Speaker 9: is this is the biggest of any of the recent ones.

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Speaker 9: We will get to see whether tax rises are coming

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Speaker 9: for the wealthy probably but potentially for everybody, and that

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Speaker 9: will be a huge moment for the Labor government and

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Speaker 9: whether they can manage these really different difficult balancing acts

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Speaker 9: that they've got between keeping the public's finances on a

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Speaker 9: sound footing. Labor are constantly telling us that they've inherited

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Speaker 9: a really bad picture on the public finances, need to

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Speaker 9: not choke off economic growth and wealth creation, which they

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Speaker 9: say is their number one priority in governments, and being

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Speaker 9: able to find a way to do both of those

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Speaker 9: things is a big challenge and certainly the main thing

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Speaker 9: that we'll all be looking out for when Parliament comes

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Speaker 9: back next week.

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Speaker 2: How much have we been warned, I suppose about the

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Speaker 2: bad news that is to come, because in the past

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Speaker 2: few days we heard from the Prime Minister telling us

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Speaker 2: that there were painful decisions ahead, pointing us towards as

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Speaker 2: you have the budget at the end of October. Is

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Speaker 2: them setting a tone for what's going to be a

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Speaker 2: fairly rough ride when it comes to the difficult decisions

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Speaker 2: that have to be made.

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Speaker 9: It is they are are being pretty upfront about the

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Speaker 9: fact that they're going to be making some very unpopular decisions.

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Speaker 9: You know, Labor said during the election campaign that they

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Speaker 9: didn't want to put up taxes, that they had no plans.

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Speaker 9: So as we kept hearing to put up taxes beyond

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Speaker 9: a small select view that they that they announced in

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Speaker 9: their manifesto, and it turns out that they are going

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Speaker 9: to put up more taxes than they were they were saying.

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Speaker 9: And their argument is that are, well, we've looked at

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Speaker 9: the books and things are worse than we thought. Well, yes, maybe,

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Speaker 9: but I think many would have suspected that this was

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Speaker 9: coming regardless of what they'd found. And you know, on

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Speaker 9: the flip side, Rachel Reeves has her own party to

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Speaker 9: manage as well. In this budget, there will be labor

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Speaker 9: MPs and indeed cabinet ministers who want more public spending

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Speaker 9: for their either their departments, whether it's you know, justice

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Speaker 9: or health or whatever, education or whatever, but also you know,

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Speaker 9: on things like welfare. Crucially, there's the two child benefit cap,

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Speaker 9: which Labor MPs really want to be lifted at some

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Speaker 9: point in this parliament. Doesn't look like there is any

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Speaker 9: money for it at the moment, but Reeves will come

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Speaker 9: under huge pressure to have something positive to say as well,

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Speaker 9: amongst all the doom and gloom, what.

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Speaker 2: Are the other key policies that you're going to be

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Speaker 2: watching out for coming through the parliamentary process as MPs

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Speaker 2: get back to business.

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Speaker 9: Oh, we're still awaiting details on some of Kearsarmer's plans

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Speaker 9: on things like immigration, where he said he's going to

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Speaker 9: set up a new border force to deal with a

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Speaker 9: regular migration across the English Channel. That's a major test

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Speaker 9: for his premiership as he comes under pressure from right

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Speaker 9: wing parties and he certainly will do towards the end

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Speaker 9: of the parliament. Whether he can get on top of

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Speaker 9: that is a major is a major unknown Picting the NHS,

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Speaker 9: which has been ridden with strikes over the last you know,

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Speaker 9: a few years and long wait lists. That is a

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Speaker 9: key priority for labor voters but all voters, and he

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Speaker 9: needs to be able to show progress there. So there's

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Speaker 9: a really a lot of unknowns about what policy Kiss

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Speaker 9: Armer is going to come up with over the next

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Speaker 9: few months, and the budget will be the first time

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Speaker 9: that we get to see them.

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Speaker 2: Well, keeping you and us busy in the meantime, Alex.

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Speaker 2: The other thing to think about, I suppose is that

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Speaker 2: Kiss Armer was elected with this fairly hefty parliamentary majority

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Speaker 2: as well. Are there going to be questions over a

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Speaker 2: Labor Party unity as the party gears into sort of

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Speaker 2: the main business of governing them and some unpopular choices.

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Speaker 9: I think so. You know, even over the last few

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Speaker 9: weeks we've seen early creaks of unity on things like

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Speaker 9: winter fuel payments, which Rachel we have said at the

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Speaker 9: beginning of the summer or the middle of the summer

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Speaker 9: that she was going to remove this winter fuel allowance

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Speaker 9: for pensioners. Now that has proven highly controversial within the

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Speaker 9: Labor Party. Funnily enough, if you're a Labor MP and

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Speaker 9: you've got lots of pensioners in it constituency, and pensioners

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Speaker 9: tend to be the people who vote, you know, turn

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Speaker 9: out to vote. They're not very happy about it. And

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Speaker 9: there are many pensioners who are not well off who

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Speaker 9: will struggle to keep hold of this allowance, and that

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Speaker 9: is going to be an unpopular policy. Rachel Reads is

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Speaker 9: sticking by it, you know, she insists no u turns,

435
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Speaker 9: no backing down. These are the unpopular decisions that she

436
00:24:26,760 --> 00:24:28,959
Speaker 9: has to make because of the fiscal inheritance that's been

437
00:24:29,000 --> 00:24:32,320
Speaker 9: handed to her, Well, yes, but we'll see whether that

438
00:24:32,400 --> 00:24:34,960
Speaker 9: stands the test of time. We're already hearing that she's

439
00:24:35,040 --> 00:24:37,280
Speaker 9: now having to come up with new ways to sort

440
00:24:37,320 --> 00:24:41,600
Speaker 9: of finesse this policy and take soften some of the

441
00:24:41,680 --> 00:24:44,520
Speaker 9: rough edges on it to keep labor MPs happy. And

442
00:24:44,520 --> 00:24:47,000
Speaker 9: that's a sign that even with a big majority, Keir

443
00:24:47,040 --> 00:24:50,000
Speaker 9: Starmor is still coming under pressure from his own MPs

444
00:24:50,040 --> 00:24:53,120
Speaker 9: and from within his own cabinet. And for a poor

445
00:24:53,200 --> 00:24:57,159
Speaker 9: politician who prizes unity and professionalism and all of that

446
00:24:57,240 --> 00:24:59,680
Speaker 9: above all else, that will be an interesting test.

447
00:25:00,040 --> 00:25:02,880
Speaker 2: And Alex just a thought too on the leadership race

448
00:25:02,920 --> 00:25:05,679
Speaker 2: for the Tories as well. Of course, now in opposition,

449
00:25:05,920 --> 00:25:08,600
Speaker 2: what will you be watching out for in those party dynamics.

450
00:25:08,880 --> 00:25:12,040
Speaker 9: Well, it's a long way to go and a link

451
00:25:12,359 --> 00:25:15,160
Speaker 9: quite an open race, to be honest. You've got Kenny

452
00:25:15,200 --> 00:25:19,240
Speaker 9: Badenock probably still just about the front runner, but Robert

453
00:25:19,320 --> 00:25:23,280
Speaker 9: Jenmis made an interesting sort of the last few weeks,

454
00:25:23,400 --> 00:25:27,399
Speaker 9: getting out and about and sort of perhaps outperforming expectations

455
00:25:27,480 --> 00:25:30,280
Speaker 9: and rising up the ranks in the polls. So it'll

456
00:25:30,320 --> 00:25:33,080
Speaker 9: be interesting to see whether the front runner, Kermy Baid

457
00:25:33,160 --> 00:25:36,199
Speaker 9: or not can continue that momentum. She hasn't done a

458
00:25:36,200 --> 00:25:38,720
Speaker 9: great deal of campaigning over the summer. That sort of

459
00:25:38,760 --> 00:25:41,040
Speaker 9: starts now as we head back to school, as it were.

460
00:25:41,880 --> 00:25:44,560
Speaker 9: And then whether the likes of James Cleverly Tom tugan

461
00:25:44,640 --> 00:25:48,600
Speaker 9: Hat can make enough of a splash to get attention

462
00:25:48,760 --> 00:25:52,119
Speaker 9: on themselves is the other difficult thing in the media

463
00:25:52,160 --> 00:25:55,800
Speaker 9: ahead of Tory Party Conference where things start to get serious.

464
00:25:56,080 --> 00:25:59,879
Speaker 2: Thanks to Bloomberg's UK Political editor Alex Wickham, I'm Stephen

465
00:26:00,000 --> 00:26:02,560
Speaker 2: Maarlyn London. You can catch us every weekday morning here

466
00:26:02,560 --> 00:26:05,520
Speaker 2: for Bloomberg Daybreak Europe, beginning at six am in London

467
00:26:05,600 --> 00:26:07,200
Speaker 2: on one am on Wall Streets.

468
00:26:07,240 --> 00:26:10,120
Speaker 1: Tom, Thank you, Steven. And coming up on Bloomberg day

469
00:26:10,119 --> 00:26:13,520
Speaker 1: Break weekend to look ahead to Taiwan's semi Con summit.

470
00:26:13,920 --> 00:26:28,200
Speaker 1: I'm Tom Busby and this is Bloomberg. This is Bloomberg

471
00:26:28,240 --> 00:26:30,440
Speaker 1: day Break Weekend, our global look ahead at the top

472
00:26:30,480 --> 00:26:33,359
Speaker 1: stories for investors in the coming week. I'm Tom Busby

473
00:26:33,400 --> 00:26:36,720
Speaker 1: in New York. Semi Coon Taiwan kicking off this week,

474
00:26:36,800 --> 00:26:39,560
Speaker 1: and that's where high level discussions on the latest chip

475
00:26:39,600 --> 00:26:43,600
Speaker 1: industry trends and solutions take place. Let's get to Bloomberg

476
00:26:43,680 --> 00:26:46,360
Speaker 1: day Break Asia co host Doug Krisner for more onut

477
00:26:46,359 --> 00:26:47,440
Speaker 1: a preview Tom.

478
00:26:47,480 --> 00:26:51,840
Speaker 3: The enthusiasm around artificial intelligence has made the chip industry

479
00:26:52,080 --> 00:26:56,120
Speaker 3: the hottest area in information technology now. To be fair,

480
00:26:56,320 --> 00:27:00,320
Speaker 3: not all chip makers are benefiting equally. Clearly, the domned

481
00:27:00,400 --> 00:27:04,399
Speaker 3: force is in Vidia. Its graphic processing units have become

482
00:27:04,440 --> 00:27:08,960
Speaker 3: the backbone of AI computing. But in building AI infrastructure,

483
00:27:09,040 --> 00:27:13,280
Speaker 3: those GPUs must be paired with high bandwidth memory chips,

484
00:27:13,840 --> 00:27:18,399
Speaker 3: and the lion shares of those hbms are produced in Asia.

485
00:27:18,560 --> 00:27:21,959
Speaker 3: Earlier I spoke with Mario Morales, Group vice President of

486
00:27:22,119 --> 00:27:27,000
Speaker 3: Enabling Technologies and Semiconductors at IDC. The question is whether

487
00:27:27,280 --> 00:27:30,440
Speaker 3: HBM chip makers will be able to keep up with demand.

488
00:27:31,200 --> 00:27:34,840
Speaker 10: We're not seeing the weakness. In fact, since probably September

489
00:27:34,840 --> 00:27:39,119
Speaker 10: of last year, the memory companies began to change their

490
00:27:39,200 --> 00:27:43,000
Speaker 10: operations in order to get back to profitability. But demand returned,

491
00:27:43,040 --> 00:27:46,480
Speaker 10: especially from the data center, and today we're expecting that

492
00:27:46,600 --> 00:27:50,560
Speaker 10: both DRAM and NAND will grow significantly from a revenue basis,

493
00:27:50,680 --> 00:27:53,400
Speaker 10: close to seventy three percent in terms of revenue growth,

494
00:27:53,480 --> 00:27:56,280
Speaker 10: so very phenomenal growth. A lot of that led not

495
00:27:56,400 --> 00:27:59,920
Speaker 10: just by high bandwidth memory but also DDR five that's

496
00:28:00,080 --> 00:28:04,320
Speaker 10: being used in the flagship smartphones and the upcoming aipcs

497
00:28:04,359 --> 00:28:07,360
Speaker 10: that we'll see later during the holiday season. I think

498
00:28:07,400 --> 00:28:11,040
Speaker 10: in general, the demand for memory will still remain robust

499
00:28:11,080 --> 00:28:13,600
Speaker 10: this year and likely into twenty twenty five.

500
00:28:13,720 --> 00:28:18,240
Speaker 3: That is Mario Morales from IDC. So let's circle back

501
00:28:18,359 --> 00:28:20,800
Speaker 3: to what we heard in the last week from Nvidia

502
00:28:20,880 --> 00:28:23,880
Speaker 3: and the company saying it is now working through production

503
00:28:24,080 --> 00:28:29,240
Speaker 3: snags with its highly anticipated new Blackwell GPU chip. I

504
00:28:29,280 --> 00:28:33,240
Speaker 3: spoke about this with Dan Newman, CEO of the Futurum Group,

505
00:28:33,680 --> 00:28:36,480
Speaker 3: and really wanted to get at how this may impact

506
00:28:36,560 --> 00:28:39,080
Speaker 3: those high bandwidth memory chip makers.

507
00:28:39,600 --> 00:28:42,480
Speaker 11: I think this continues to be the reason why, whether

508
00:28:42,800 --> 00:28:45,040
Speaker 11: Blackwell is a little bit delayed or not, they're going

509
00:28:45,080 --> 00:28:48,239
Speaker 11: to produce as much of the hopper as possible. The

510
00:28:48,440 --> 00:28:52,760
Speaker 11: overall situation as it pertains to memory is they're also

511
00:28:52,840 --> 00:28:55,520
Speaker 11: constrained there. So you heard me talk about three and animeter.

512
00:28:55,280 --> 00:28:59,800
Speaker 12: Constrained, COOSTS constrained, and of course HBM constrained.

513
00:29:00,160 --> 00:29:03,680
Speaker 11: So right now you are literally seeing these five or

514
00:29:03,720 --> 00:29:08,680
Speaker 11: so major hyperscalers plus global hyperscalers and Tier two's taking

515
00:29:08,760 --> 00:29:11,200
Speaker 11: up the vast majority of the demand for all of

516
00:29:11,240 --> 00:29:15,320
Speaker 11: these major parts of the supply, and you know, Jensen

517
00:29:15,320 --> 00:29:16,120
Speaker 11: talked about it being.

518
00:29:16,000 --> 00:29:19,120
Speaker 12: Around forty five percent coming from the three or four

519
00:29:19,200 --> 00:29:22,040
Speaker 12: biggest but they are taking most of the demand and

520
00:29:22,160 --> 00:29:25,320
Speaker 12: until we can expand capacity. So it's on Micron, which

521
00:29:25,360 --> 00:29:28,360
Speaker 12: is investing, It's on sk and Samsung, all of which

522
00:29:28,360 --> 00:29:31,520
Speaker 12: are investing. But it can't happen fast enough. This does

523
00:29:31,600 --> 00:29:32,000
Speaker 12: take time.

524
00:29:32,120 --> 00:29:35,360
Speaker 3: He is Dan Newman from the Futuum Group. I think

525
00:29:35,360 --> 00:29:37,800
Speaker 3: it's fair to say that high bandwidth memory chips will

526
00:29:37,840 --> 00:29:41,280
Speaker 3: likely dominate the conversation in the coming week at the

527
00:29:41,400 --> 00:29:45,560
Speaker 3: semecon Taiwan twenty twenty four. To preview the event, I'm

528
00:29:45,640 --> 00:29:49,280
Speaker 3: joined by Bloomberg's Jane Lee. She covers the chip industry,

529
00:29:49,320 --> 00:29:52,720
Speaker 3: and she joins us now from our studios in Taiepai. Jane,

530
00:29:52,760 --> 00:29:55,520
Speaker 3: thanks for making time. Is it fair to say? Was

531
00:29:55,560 --> 00:29:58,360
Speaker 3: I write in saying that high bandwidth memory chips are

532
00:29:58,360 --> 00:30:00,640
Speaker 3: going to dominate the conversation semicon?

533
00:30:00,880 --> 00:30:06,440
Speaker 13: That's absolutely right. In fact, this semikon Taiwan is different

534
00:30:06,480 --> 00:30:11,560
Speaker 13: from previous years. Taiwan and South Korea are two sort

535
00:30:11,600 --> 00:30:15,760
Speaker 13: of rivals when it comes to chip making. Samsung is

536
00:30:15,800 --> 00:30:19,760
Speaker 13: a rival of TSMC when it comes to logic chips

537
00:30:19,800 --> 00:30:24,160
Speaker 13: and so oftentimes in the past, the Samsung or s

538
00:30:24,240 --> 00:30:26,720
Speaker 13: k Heinex might have sent over, you know, a mid

539
00:30:26,800 --> 00:30:30,200
Speaker 13: level manager and they weren't in the keynote. They were

540
00:30:30,240 --> 00:30:35,360
Speaker 13: barely even noticeable. This time, the sk Heinex president Kim

541
00:30:35,440 --> 00:30:40,240
Speaker 13: Jusn and Samsung Electronics head of Memory I Jianbe are

542
00:30:40,280 --> 00:30:45,200
Speaker 13: both giving keynote speeches and are quite high profilely set

543
00:30:45,280 --> 00:30:48,840
Speaker 13: during the conference. So it's kind of a rare thing.

544
00:30:48,960 --> 00:30:51,560
Speaker 13: And the reason for that is, as you point out

545
00:30:51,720 --> 00:30:56,360
Speaker 13: the high bandwidth memory chips. Before, when Samsung and TSMC

546
00:30:56,480 --> 00:31:00,560
Speaker 13: were just rivals over over logic chips, they were, but

547
00:31:00,720 --> 00:31:03,160
Speaker 13: now they're going to have to start to work together

548
00:31:03,560 --> 00:31:07,440
Speaker 13: as Samsung tries to get into the HBM business in

549
00:31:07,480 --> 00:31:10,520
Speaker 13: a much bigger way. It's kind of behind sk Heinix,

550
00:31:10,760 --> 00:31:14,280
Speaker 13: but it definitely is aiming for in Nvidia's business, and

551
00:31:14,360 --> 00:31:17,200
Speaker 13: when it does that, it will have to ship those

552
00:31:17,520 --> 00:31:22,240
Speaker 13: HBM chips or the wafers thereon over to TSMC or

553
00:31:22,280 --> 00:31:27,640
Speaker 13: TSMC's partner that packages those together. So this time Taiwan

554
00:31:27,680 --> 00:31:31,960
Speaker 13: and South Korea are both prominently featured at Semiicon Taiwan,

555
00:31:32,040 --> 00:31:35,040
Speaker 13: so that'll be quite interesting. The other thing that will

556
00:31:35,320 --> 00:31:40,680
Speaker 13: be highly watched is packaging because the HBM and the

557
00:31:40,920 --> 00:31:45,480
Speaker 13: GPU that in Nvidia provides will have to be packaged together.

558
00:31:46,080 --> 00:31:51,240
Speaker 13: This new advanced packaging, which is called COOS chip on

559
00:31:51,400 --> 00:31:55,480
Speaker 13: wafer on substrate, it's basically the newest technology to pull

560
00:31:55,520 --> 00:31:58,959
Speaker 13: these chips together to make them work like one. So

561
00:31:59,000 --> 00:32:02,960
Speaker 13: a lot of those technologies will be highlighted. And this

562
00:32:03,120 --> 00:32:08,280
Speaker 13: technology of advanced packaging is also in short supply. TSMC

563
00:32:08,400 --> 00:32:11,160
Speaker 13: has said that they will double the capacity by the

564
00:32:11,280 --> 00:32:13,560
Speaker 13: end of the year and next year double that again.

565
00:32:14,200 --> 00:32:17,480
Speaker 13: So a lot of people will be very interested to

566
00:32:17,600 --> 00:32:21,080
Speaker 13: see how that's going and what kind of other future

567
00:32:21,160 --> 00:32:25,280
Speaker 13: technologies there are to bring all these different chips together.

568
00:32:25,560 --> 00:32:28,280
Speaker 13: Because Moore's law is kind of dead.

569
00:32:29,600 --> 00:32:31,880
Speaker 3: It's interesting if you look at the history of TSMC,

570
00:32:32,040 --> 00:32:34,840
Speaker 3: there was obviously a lot of government support on the

571
00:32:34,880 --> 00:32:38,640
Speaker 3: part of Taiwan. Here in the States, we're dealing with

572
00:32:38,680 --> 00:32:40,960
Speaker 3: the Chips and Science Act as a way of trying

573
00:32:41,000 --> 00:32:44,160
Speaker 3: to provide some support for the industry and keep it

574
00:32:44,240 --> 00:32:47,880
Speaker 3: growing domestically in the United States. I'm curious about the

575
00:32:47,960 --> 00:32:51,240
Speaker 3: role that governments are playing right now, whether it's Taiwan

576
00:32:51,720 --> 00:32:53,920
Speaker 3: or South Korea. Are they heavily involved?

577
00:32:54,080 --> 00:32:57,200
Speaker 13: South Korea and Taiwan are both heavily involved. There's always

578
00:32:57,240 --> 00:33:01,400
Speaker 13: tax incentives and large programs, the billions that are rolled

579
00:33:01,400 --> 00:33:06,600
Speaker 13: out to support the domestic chip industry. That's not going

580
00:33:06,640 --> 00:33:10,280
Speaker 13: to change part of the problem though. And what's interesting

581
00:33:10,840 --> 00:33:14,000
Speaker 13: for me when I watch the US government roll out

582
00:33:14,040 --> 00:33:18,680
Speaker 13: the Chips Act and bring TSMC and Samsung to build

583
00:33:18,680 --> 00:33:21,680
Speaker 13: more fabs in the US. I mean, they're saying that

584
00:33:21,680 --> 00:33:25,160
Speaker 13: they're going to do this to resolve a supply chain issue.

585
00:33:25,280 --> 00:33:28,479
Speaker 13: It's for national security. But the fact that is not

586
00:33:28,920 --> 00:33:32,360
Speaker 13: often talked about is that these wafers, once they're printed

587
00:33:32,760 --> 00:33:35,560
Speaker 13: in those US fabs, they still have to get on

588
00:33:35,640 --> 00:33:38,680
Speaker 13: a plane or a ship to come back to Asia

589
00:33:38,800 --> 00:33:43,560
Speaker 13: for this next process of advanced packaging. So in fact,

590
00:33:43,800 --> 00:33:46,880
Speaker 13: we don't talk about it a lot, but the Chips

591
00:33:46,880 --> 00:33:52,120
Speaker 13: Act is not solving completely the supply chain issue that

592
00:33:52,160 --> 00:33:55,760
Speaker 13: we all think it should, and so that'll be something

593
00:33:55,800 --> 00:33:59,880
Speaker 13: that we should all watch going forward. And once TSMC

594
00:34:00,000 --> 00:34:02,920
Speaker 13: these fabs are up and running, I think that issue

595
00:34:02,960 --> 00:34:05,320
Speaker 13: could be pointed out a lot more well.

596
00:34:05,400 --> 00:34:09,719
Speaker 3: In so far as TSMC's production in Taiwan, obviously this

597
00:34:09,800 --> 00:34:12,600
Speaker 3: is a foundry, they are the manufacturer, and there may

598
00:34:12,640 --> 00:34:15,640
Speaker 3: be a little bit of concern, particularly when you hear

599
00:34:15,680 --> 00:34:18,480
Speaker 3: what in Nvidia had to say about whether or not

600
00:34:18,840 --> 00:34:22,640
Speaker 3: TSMC is going to be able to keep up with demand. Again,

601
00:34:23,040 --> 00:34:25,840
Speaker 3: here is Mario Morales at IDC.

602
00:34:26,239 --> 00:34:29,200
Speaker 10: That's continued to be the theme right for over a

603
00:34:29,280 --> 00:34:31,600
Speaker 10: year now. I think last year we saw correction in

604
00:34:31,600 --> 00:34:34,799
Speaker 10: a semic ntor space, but when you look at TSMC,

605
00:34:34,880 --> 00:34:38,080
Speaker 10: they tend to buck the trend. They're a very strong

606
00:34:38,160 --> 00:34:40,600
Speaker 10: player in the founder space. The leader they control over

607
00:34:40,719 --> 00:34:44,040
Speaker 10: sixty percent of the market. Where they're investing heavily now

608
00:34:44,120 --> 00:34:47,080
Speaker 10: is in advanced packaging. So when you hear about COOS,

609
00:34:47,880 --> 00:34:50,280
Speaker 10: all of that means is that that's where they're seeing

610
00:34:50,600 --> 00:34:52,879
Speaker 10: the big investments that they need to make in order

611
00:34:52,920 --> 00:34:56,239
Speaker 10: to serve companies like Nvidia and Broadcom and AMD and

612
00:34:56,360 --> 00:34:59,760
Speaker 10: others that are now beginning to use more advanced packaging

613
00:35:00,239 --> 00:35:01,719
Speaker 10: to continue to drive integration.

614
00:35:01,960 --> 00:35:06,839
Speaker 3: He is Mario Morales of IDC talking about expanding capacity

615
00:35:07,000 --> 00:35:10,680
Speaker 3: at TSMC. Let's get back to the issue. At hands

616
00:35:10,680 --> 00:35:15,000
Speaker 3: Semicon Taiwan, twenty twenty four, Bloomberg's Jane Lee is with

617
00:35:15,080 --> 00:35:17,520
Speaker 3: us from our studios in Taipei. Do you think there's

618
00:35:17,560 --> 00:35:20,200
Speaker 3: going to be any news made out of this conference.

619
00:35:20,400 --> 00:35:23,919
Speaker 13: The conference generally doesn't really create news. It's not been

620
00:35:24,040 --> 00:35:29,200
Speaker 13: an area where executives come to unveil big news. They

621
00:35:29,280 --> 00:35:32,040
Speaker 13: kind of do that on their own home turf for

622
00:35:32,160 --> 00:35:36,400
Speaker 13: in their big conferences. But the one thing that people

623
00:35:36,520 --> 00:35:41,680
Speaker 13: are talking about ahead of the conference is whether or

624
00:35:41,719 --> 00:35:45,360
Speaker 13: not Jensen Wang, the CEO for Nvidia, is going to

625
00:35:45,400 --> 00:35:51,240
Speaker 13: show up or not. Korean media earlier this year speculated

626
00:35:51,640 --> 00:35:59,360
Speaker 13: Jensen Wang and TSMC's possibly CEO and s k Heinez

627
00:35:59,480 --> 00:36:04,319
Speaker 13: is Press would have a fireside chat, but that's not

628
00:36:04,480 --> 00:36:08,279
Speaker 13: really shown up on the agenda, and in Nvidia is

629
00:36:08,320 --> 00:36:12,240
Speaker 13: declining to confirm whether or not Jensen will be coming,

630
00:36:12,520 --> 00:36:15,520
Speaker 13: and so the chatter is is he coming or not?

631
00:36:15,680 --> 00:36:20,160
Speaker 13: And some teams are also deciding how many people they

632
00:36:20,239 --> 00:36:22,680
Speaker 13: send depending on whether he is here or not. Is

633
00:36:22,719 --> 00:36:25,520
Speaker 13: one of those things like almost like a high school

634
00:36:25,560 --> 00:36:28,640
Speaker 13: party where if this person comes, I'll come, but if

635
00:36:28,640 --> 00:36:30,440
Speaker 13: he's not going to be there, I'm not coming either.

636
00:36:31,160 --> 00:36:34,520
Speaker 13: So it's quite amusing. And the reason for that is

637
00:36:34,560 --> 00:36:38,520
Speaker 13: because Jensen made such a splash during Computex, which is

638
00:36:38,560 --> 00:36:43,160
Speaker 13: the other big Taiwan conference that was held in early June,

639
00:36:43,440 --> 00:36:47,040
Speaker 13: and for that everybody else showed up because he was here.

640
00:36:47,719 --> 00:36:52,120
Speaker 13: AMD CEO Lisa Sue came, pack Elsinger, CEO of Intel

641
00:36:52,200 --> 00:36:57,080
Speaker 13: came and they were all going around and signing servers

642
00:36:57,280 --> 00:37:02,239
Speaker 13: and hardware for their suppliers and customers. So it was

643
00:37:02,400 --> 00:37:06,600
Speaker 13: quite the feast. So people are trying to see if

644
00:37:06,840 --> 00:37:10,800
Speaker 13: Semikon Taiwan will be another one of those events. Semi

645
00:37:10,880 --> 00:37:15,240
Speaker 13: Coon is generally more of a technology conference where future

646
00:37:15,280 --> 00:37:19,759
Speaker 13: technology is discussed, so you know, we'll have to wait

647
00:37:19,800 --> 00:37:24,520
Speaker 13: and see, but everyone's getting excited for him possibly showing

648
00:37:24,600 --> 00:37:25,000
Speaker 13: up again.

649
00:37:25,520 --> 00:37:27,400
Speaker 3: Jane, Before I let you go, I have to ask

650
00:37:27,600 --> 00:37:30,120
Speaker 3: one of the things that the Biden administration is obviously

651
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Speaker 3: imposed on China is a restriction on some of the

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Speaker 3: high and the most advanced semiconductors, many of which are

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Speaker 3: made by Nvidia. That's part of that story, obviously, and

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Speaker 3: I'm wondering how the suppliers in Asia are feeling about

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Speaker 3: those restrictions and how it's impacting their businesses.

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Speaker 13: That's really interesting because these export control on Nvidia AI

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Speaker 13: chips into China has really changed already the flow of trade.

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Speaker 13: Because China can't get these chips, they cannot build AI

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Speaker 13: servers that they might have built or that they used

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Speaker 13: to build, and a lot of that business is coming

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Speaker 13: to Taiwan. And so that's pretty visible when you just

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Speaker 13: look at the trade number exports of ai server related

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Speaker 13: parts from China versus Taiwan. And so it's having a

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Speaker 13: real impact and Asian companies are having to pivot and

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Speaker 13: change their business accordingly.

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Speaker 3: Jane, thank you so much. We'll have to check back.

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Speaker 3: I know you're going to Semicon Taiwan twenty twenty four

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Speaker 3: to cover it for Bloomberg. I'll be interested in reading

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Speaker 3: your reporting and maybe we can have you on the

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Speaker 3: radio to talk about it further. Bloomberg's Jane Lee joining

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Speaker 3: from our studios in Taipei. I'm Doug Krisner. You can

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Speaker 3: join Brian Curtis and myself weekdays here for Bloomberg Daybreak

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Speaker 3: Asia beginning at eight am in Hong Kong eight pm

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Speaker 3: on Wall Street. Tom.

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Speaker 1: Thank you, Doug, and that does it for this edition

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Speaker 1: of Bloomberg day Break Weekend. Join us again Monday morning

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