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Speaker 1: This is the Bloomberg Day Bak you At podcast, available

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Speaker 1: every morning on Apple, Spotify or wherever you listen. It's Friday,

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Speaker 1: the tenth of May in London.

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Speaker 2: I'm Caroline Hipkin.

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Speaker 3: And I'm Stephen Carroll. Coming up today, the United States

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Speaker 3: is poised to announce major new tariffs targeting China's strategic sectors.

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Speaker 1: Benjamin Netanya, who says Israel will continue its war against

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Speaker 1: Hamas despite US warnings.

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Speaker 3: Plus to tip or not to tip? Why British pubgoers

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Speaker 3: are facing a new dilemma at the bar.

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

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Speaker 3: US President Joe Biden will unveil tariffs against China as

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Speaker 3: soon as next week, targeting key sectors including electric vehicles, batteries,

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Speaker 3: and solar equipment. Bloomberg has learned the policies, which would

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Speaker 3: mark of one of Biden's biggest moves against Chinese trade,

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Speaker 3: are scheduled to be announced next Tuesday. Bloomberg's Stephen Engel

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Speaker 3: says it's the latest sign of how Chinese subsidies are

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Speaker 3: causing a global backlash.

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Speaker 4: What we're hearing from sources in this scoop is that

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Speaker 4: these new Tuo tariffs would be very targeted at the

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Speaker 4: three key green industries that Chi Jinping has essentially earmarked

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Speaker 4: as priorities for investment, the New Three, as he called

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Speaker 4: it at the National People's Congress in March, and that

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Speaker 4: is electric vehicles, batteries, and solar.

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Speaker 3: Steven Engel adds these targeted plans are a contrast to

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Speaker 3: Donald Trump's pledge to levy a sixty percent tax on

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Speaker 3: all Chinese imports if he wins the next election. Biden's

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Speaker 3: tariff move comes after a stabilization of ties with China

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Speaker 3: amid a flurry of diplomatic engagements.

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Speaker 1: Benjamin Netna, who says Israel will fight alone even without

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Speaker 1: US help and must continue its offensive against Hamas in Rafa.

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Speaker 1: On Wednesday, President Biden said that he would hold additional

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Speaker 1: shipments of offensive weapons to Israel if it launches a

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Speaker 1: ground invasion of the southern Gaza city. But Benjamin Netna,

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Speaker 1: who told American television personality Doctor Phil he has to

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Speaker 1: protect his country.

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Speaker 5: I've said in the Holocaust memorial service that we had

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Speaker 5: the other day, I said in the Holocaust we stood alone,

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Speaker 5: but we were defenseless. And today if Israel has to

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Speaker 5: stand alone, we'll stand alone.

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Speaker 1: The Israeli Prime minister was responding to the US withholding

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Speaker 1: a shipment of bombs as a sign of the growing

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Speaker 1: rift between the two countries. The UK has echoed America's concerns,

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Speaker 1: saying that it won't support any major Israeli operation in RAFA.

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Speaker 3: The Bank of England and market so now roughly in

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Speaker 3: line about the prospect of a June rate cut. This

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Speaker 3: after months of divergence between investors and policymakers over when

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Speaker 3: borrowing costs will be lowered. The Bank of England held

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Speaker 3: rates steady at its meeting yesterday. Governor Andrew Bailey said

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Speaker 3: a loosening of monetary policy may come soon.

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Speaker 6: With the progress we've made to make sure that inflation

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Speaker 6: stays around the two percent target, it's likely that we

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Speaker 6: will need to cut bank rate over the coming quarters

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Speaker 6: and make monitory policy is somewhat less restrictive over the

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Speaker 6: forecast period, possibly more so than currently priced into market.

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Speaker 3: Roots spanker finger Governor Andrew Bailey. Following his remarks, investor

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Speaker 3: bets on a June rate cut rows to over fifty percent,

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Speaker 3: marking a significant shift away from paired back bets and

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Speaker 3: response to stronger US inflation. In terms of data. Two

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Speaker 3: sets of inflation and labor market releases are due in

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Speaker 3: the UK before the next Monetary Policy Committee vote on

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Speaker 3: the twentieth of June.

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Speaker 1: Sabadel is accusing BBVA of breaking Spanish laws with its

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Speaker 1: twelve billion dollar hostile takeover bid for the bank. Tensions

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Speaker 1: are running high between the two lenders after bbva's offer,

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Speaker 1: which rivals Abadel says, introduces quote incomplete information that may

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Speaker 1: affect the market. The Spanish government is also opposed to

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Speaker 1: the mergers, saying that they have the final word on

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Speaker 1: approving any deal. Hostile bids are a rarity in European banking.

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Speaker 1: A spokesperson for BBVA had no comment when contacted by Berg.

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Speaker 3: Bill Ackman was criticized for his public attacks on diversity

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Speaker 3: and inclusion policies, and a closed door panel at the

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Speaker 3: Milken Conference about forty people, including some of Wall Street's

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Speaker 3: most senior executives of color, confronted Akman for an hour. Reportedly,

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Speaker 3: even fellow panelists, which included Teacher Retirement System of Texas

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Speaker 3: chair Jarvis Hollingsworth and the president of Guggenheim Investments Dina

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Speaker 3: do Lorenzo, took Wachman to task at least one speaker

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Speaker 3: said his public comments reflected eight poor understanding of the

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Speaker 3: civil rights movement.

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Speaker 1: Armshares tumbled on Thursday after a tepid revenue forecast for

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Speaker 1: the fiscal year raised concerns about a slowdown in the

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Speaker 1: tech sector's AI spending. The UK based chip designer, who's

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Speaker 1: upbeat forecast sent schares soaring only three months ago, so

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Speaker 1: that revenue in the year to March twenty twenty five

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Speaker 1: will be lower than analysts head forecasts. Arm CEO Rene

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Speaker 1: Hass has been speaking to Boombogs, Caroline Hyde and Ed

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Speaker 1: Ludd about why he is optimistic about their rate of growth.

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Speaker 7: We're actually forecasting even higher growth this year and north

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Speaker 7: of twenty percent, and we also signaled to the markets

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Speaker 7: yesterday that in twenty five, twenty six, twenty seven we

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Speaker 7: see that growth continuing. So we have incredible visibility into

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Speaker 7: our business and we're very, very confident of this growth

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Speaker 7: rate going forward.

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Speaker 1: That was I'm CEO and Aha speaking to Bloomberg there now.

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Speaker 1: In a moment, we will discuss the Biden China tariffs.

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Speaker 1: It's a Bloomberg exclusive. The expectation is that they will

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Speaker 1: be announced to Tuesday next week. And also why tipping

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Speaker 1: in pubs in the UK is becoming more common. It's

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Speaker 1: a really nice read on Friday. But first, the huge

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Speaker 1: backlash that we've seen this week against Apple's Crush ad.

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Speaker 1: The companies issued a rare apology.

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Speaker 3: Yeah, I mean, if you haven't seen it, it's essentially

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Speaker 3: a giant sort of press that comes out and crushes

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Speaker 3: a variety of creative illustrations of musical instruments, pots of paints,

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Speaker 3: where seting. Yeah, there was even an angry bird in

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Speaker 3: there from the Rovio computer game as well. And Apple

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Speaker 3: says it won't air the ad on TV as planned

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Speaker 3: and said that creativity was in their DNA and Apple

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Speaker 3: and it was important for them design products that power

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Speaker 3: creatives all over the world. Daily our opinion Colum must

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Speaker 3: have been writing about this, describing the ad as being

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Speaker 3: tone deaf and saying he's found it hard to believe

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Speaker 3: that no one saw it coming, that this ad would

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Speaker 3: come in for such criticism for literally crushing creativity.

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Speaker 1: Yeah, I think the Internet kind of reacted so vehemently.

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Speaker 1: I mean, it is a bit of a depressing thought.

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Speaker 1: I think it probably reflects kind of a lot of

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Speaker 1: the worries around AI and the sort of tech future

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Speaker 1: that we all face. But yes, I think a rare

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Speaker 1: misstep perhaps in Apple's advertising.

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Speaker 3: One killer line in Dave Lee's piece, it's Apple's worst

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Speaker 3: marketing faux pas since it forced everyone to listen to

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Speaker 3: you too.

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Speaker 2: Yeah, okay, I like that good stuff.

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Speaker 1: Right. Let's send our attention then to the Bloomberg exclusive story.

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Speaker 1: Very interesting, of course, dating back to twenty eighteen, the

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Speaker 1: United States has had broad sanctions against China. Now President

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Speaker 1: Biden and the administration in the US has undertaking quite

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Speaker 1: a significant review of those. The former president Donald Trump,

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Speaker 1: of course wants to bring back much heavier penalties against China.

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Speaker 1: But now the expectation around Joe Biden is that they'll

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Speaker 1: be quite targeted tariffs.

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Speaker 3: And the fact that this is also don't forget an

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Speaker 3: election issue in the United States as well, because Donald

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Speaker 3: Trump has promised even more severe tariffs if he were

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Speaker 3: to be re elected in November. Joining US now to

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Speaker 3: discuss as our greater China Economy and Government editor Jenny

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Speaker 3: Marsh Jenny, great to have you with us on the program.

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Speaker 3: Just take us through the details of what we're expecting

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Speaker 3: the US to announce with these new measures.

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Speaker 8: So President Jo Biden. He is poised unveil this big

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Speaker 8: decision next week. It's going to target these key sort

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Speaker 8: of clean tech areas that China has really thrown the

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Speaker 8: weight of his economy. So we're looking at EV's batteries

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Speaker 8: and solar cells. And this is part of a broad

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Speaker 8: review of tariffs under the sort of the Section three

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Speaker 8: oh one tariffs at Trump imposed during his presidency. But

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Speaker 8: these levees are going to be new tariffs that are

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Speaker 8: going to put growing pressure on three industries where Beijing

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Speaker 8: is already feeling that he internationally over issues of over capacity.

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Speaker 1: Yeah, so, how significant then is it in terms of

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Speaker 1: escalation in the US China trade battle.

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Speaker 8: It's sort of ramping up the rhetoric, but actually it's

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Speaker 8: not as dramatic as it first seems because China's access

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Speaker 8: to the US market has been severely detailed already because

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Speaker 8: there are these twenty seven point five percent tariffs on autos,

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Speaker 8: so evs are not really there's a very small amount

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Speaker 8: of trade. It's not like with the European Union where

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Speaker 8: they're actually shipping tons of these things out to Europe.

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Speaker 8: They're not to the US. So it's more preventative. You know,

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Speaker 8: China has this sort of first mover adviceanted in the US,

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Speaker 8: it's really sort of closing the door on that solar panels,

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Speaker 8: solar cells, you know, already facing tariffs, and so Chinese

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Speaker 8: companies have already sort of put many of their factories

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Speaker 8: in places like Vietnam and they export directly to the

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Speaker 8: US front there. So tariffs on Chinese exports not really

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Speaker 8: don't have too much of an impact. Batteries is an

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Speaker 8: area of concern where they'll probably be more impact, but

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Speaker 8: on the face of it seems very bad. When you

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Speaker 8: dig down, a lot of actually is quite symbolic.

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Speaker 3: What about China's response to all of this, I mean,

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Speaker 3: President she has been in Europe where also there's been

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Speaker 3: criticism of Chinese subsidized exports as well. What are we

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Speaker 3: what do we should we expect from China in terms

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Speaker 3: of a response.

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Speaker 8: China has been very sort of muted in its response

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Speaker 8: so far to sort of all of the jockeying that's

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Speaker 8: happening during the US election. You know, both Biden and

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Speaker 8: Trump have you know, they're both playing sort of the

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Speaker 8: to China card in the election because it plays really

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Speaker 8: well with voters. You know, Biden last month has sort

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Speaker 8: of pledged to twenty five percent tariffon steel and aluminium

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Speaker 8: to sort of win to sort of secure votes amongst

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Speaker 8: union workers in those industries. It sounds good. In reality,

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Speaker 8: China doesn't really export much of that stuff to the US.

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Speaker 8: So their reaction to that was quite mutily announced some

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Speaker 8: sort of tip for tat tariffs on a chemical that

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Speaker 8: again that the US doesn't important much of to China.

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Speaker 8: So you can expect sort of a likeful like response,

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Speaker 8: you know, but it's damaging the relationship and understable, you know,

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Speaker 8: it sort of destabilizes a relationship overall. They're trying to

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Speaker 8: manage these ties, but the rhetoric and the trade tensions

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Speaker 8: are ramping up.

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Speaker 2: Yeah.

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Speaker 1: Absolutely, and Jenny, thank you so much for being with

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Speaker 1: us this morning. Our Greater China Economy and Government editor

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Speaker 1: Jenny Marsh. Then, as we expect the US to come

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Speaker 1: out with these tariffs and next week on Tuesday, there's

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Speaker 1: also a very good piece on the terminal. In terms

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Speaker 1: of the research from the European perspective, the EU Chamber

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Speaker 1: of Commerce in China says that China is losing its

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Speaker 1: lost as the top country to invest in firms sort

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Speaker 1: of trying to avoid all of these geopolitical risks.

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Speaker 3: And looking at alternatives instead. Let's turn to a completely

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Speaker 3: different story. Now it's Friday. Perhaps you're already looking forward

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Speaker 3: to your after work drink in.

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Speaker 2: A pub, perhaps Sunshine Beckett here in the UK.

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Speaker 3: But do you tip the bar staff? Tipping used to

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Speaker 3: be entirely optional in London pubs and limited to the

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Speaker 3: change from paying for drinks, but that's changing, and as

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Speaker 3: transactions have gone cashless, card readers at pubs are nudging

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Speaker 3: customers to tip. It's creating some awkward scenes and leaving

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Speaker 3: British pub goers with the sense pub cultures becoming Americanized.

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Speaker 3: Tony Palatso, a senior editor for Global Business at Bloomberg,

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Speaker 3: joins us now at more details on this story. Tony,

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Speaker 3: First of all, what's the background to this? How did

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Speaker 3: you get onto this story and what did you find?

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Speaker 9: This was a pretty fun story.

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Speaker 10: It started when I walked into my neighborhod pub and

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Speaker 10: I ordered a couple of drinks with some food, and

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Speaker 10: when the bartender put the card reader in front of me,

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Speaker 10: I tried to tap it as I normally do, and

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Speaker 10: it wouldn't work.

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Speaker 9: And then I looked.

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Speaker 10: And I saw that it was asking me first to

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Speaker 10: choose a tip, and I think it was like five

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Speaker 10: percent or ten percent, And being a polite American who's

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Speaker 10: lived in New York and Los Angeles, I complied and

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Speaker 10: I tapped my card and I went back to my

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Speaker 10: seat with my two pints. But I was a little

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Speaker 10: shell shocked, and this had never happened to me before.

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Speaker 10: I lived in London for eight years, and in fact,

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Speaker 10: when I first came here, I tried to tip a

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Speaker 10: bartender on a card and he just looked at me

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Speaker 10: like I was crazy, And so I hadn't even tried

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Speaker 10: since then. So I mentioned this to some friends and colleagues,

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Speaker 10: and some of them had had the same experiences, and

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Speaker 10: so I thought, okay, well, let's look into this and

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Speaker 10: if it's happening more and more and in a way

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Speaker 10: that we can quantify, maybe we'll have a story.

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Speaker 1: Yeah, it's a great story. I've noticed the same thing. Although,

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Speaker 1: of course, you know, the pandemic has been very rough

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Speaker 1: on hospitality.

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Speaker 2: So is it that? Is it the americanization? What do

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Speaker 2: the numbers tell you?

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Speaker 9: Well?

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Speaker 10: We we well, first of all, we reached out to

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Speaker 10: the payment networks.

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Speaker 9: We talked to Dojo, and we talked to some up.

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Speaker 10: And they confirmed for us that yes, in fact, it

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Speaker 10: is happening. Uh More merchants are reaching are asking people

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Speaker 10: to pay a tip, and more and more people are tipping.

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Speaker 10: And in fact, there's more tipping going on now in

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Speaker 10: pubs than in taxi cabs or in hairdressers for example.

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Speaker 10: So uh so, yeah, there's I mean, there's a there's

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Speaker 10: a few things that are driving the change.

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Speaker 9: First of all, societ is going cashless.

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Speaker 10: So one big thing that's been happening is in the past,

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Speaker 10: you'd walk into the pub, especially for a small transaction

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Speaker 10: like a pinter or two, you'd pay with cash and

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Speaker 10: then you'd get you receive some coins back as change,

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Speaker 10: and the customers might put it in their pocket or

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Speaker 10: they might leave it as a tip for the bar man.

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Speaker 9: But it was a small amount.

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Speaker 10: And what's happening, what's happened, you know, in recent years,

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Speaker 10: is virtually everything is being done with the tap. I

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Speaker 10: don't even walk around with cash money anymore, and so

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Speaker 10: the technology has been updated.

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Speaker 9: And then you know, to your question, how did the

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Speaker 9: pandemic affect this?

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Speaker 10: Well, ordering ordering if you remember when people came back

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Speaker 10: from the lockouts. From the lockdowns, people were being asked

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Speaker 10: to order over q R codes and use their phone,

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Speaker 10: and that made it easier for restaurants and pubs to

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Speaker 10: ask people for a tip, and people were feeling generous.

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Speaker 10: They felt bad for the wait staff and the bartenders

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Speaker 10: who had been out of work for so long, and

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Speaker 10: so they started they started doing it. More recently, the

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Speaker 10: pubs are starting to see this as a way to

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Speaker 10: attract workers and give and give workers a perk that

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Speaker 10: will help the pubs compete with restaurants and hotels for talent.

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Speaker 9: And this at a time when.

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Speaker 10: Profits are tight, wage inflation is on the rise, food

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Speaker 10: inflation is on the rise, and workers are hard to find.

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