WEBVTT - Daybreak Weekend: Summer Travel, Jamie Dimon, China Data 0:00:02.040 --> 0:00:04.320 This is Bloomberg day Break Weekend, our global look at 0:00:04.360 --> 0:00:06.440 the top stories in the coming week from our day 0:00:06.440 --> 0:00:09.440 Break anchors all around the world. Straight ahead on the program, 0:00:09.480 --> 0:00:12.440 the nation's biggest retailers battle it out for your summer 0:00:12.480 --> 0:00:16.120 spending dollars, and what earnings from Delta Airlines will tell 0:00:16.160 --> 0:00:19.480 us about travel demand Right now, I'm Tom Busby in 0:00:19.560 --> 0:00:20.040 New York. 0:00:20.440 --> 0:00:23.920 I'm Caroline Hetka in London as JP Morgan's Jmie Daman 0:00:24.079 --> 0:00:27.360 visits Ireland ahead of the US tariff deadline. 0:00:27.360 --> 0:00:30.720 For Europe, I'm Doug Prisner looking ahead to next week 0:00:30.840 --> 0:00:35.440 CPI and PPI reports for China. 0:00:36.200 --> 0:00:40.240 That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 0:00:40.280 --> 0:00:43.960 eleven three year, New York, Bloomberg ninety nine to one, Washington, DC, 0:00:44.479 --> 0:00:48.720 Bloomberg ninety two to nine, Boston, DAB Digital Radio, London, 0:00:49.159 --> 0:00:52.320 Sirius XM one twenty one, and around the world on 0:00:52.440 --> 0:00:55.520 Bloomberg Radio, dot Com and the Bloomberg Business App. 0:01:00.080 --> 0:01:02.320 Good day to you. I'm Tom Busby. We begin today's 0:01:02.320 --> 0:01:05.800 program with what's become a Black Friday sales bonanza in 0:01:05.840 --> 0:01:09.600 the middle of summer. Amazon's annual Prime Day July sales 0:01:09.600 --> 0:01:13.360 event kicks off with Target, Walmart and others joining in. 0:01:13.959 --> 0:01:16.959 How much money is at stake? Are Americans expected to 0:01:17.000 --> 0:01:19.399 spend like we did before? And what role could the 0:01:19.440 --> 0:01:22.520 Trump tariffs play in sales? For more, we bring in 0:01:22.600 --> 0:01:26.600 Poonham Goyle, Senior US e Commerce and retail analysts at 0:01:26.600 --> 0:01:30.160 Bloomberg Intelligence. Poonham, thank you so much for joining us 0:01:30.160 --> 0:01:34.320 this holiday weekend. Millions of Americans gearing up to spend, spend, 0:01:34.360 --> 0:01:38.520 spend at the nation's biggest retailers, and this year is 0:01:38.560 --> 0:01:40.880 a little different. I think we have a couple of 0:01:41.000 --> 0:01:44.520 competing forces. A pullback in consumer spending, no doubt some 0:01:44.560 --> 0:01:48.559 people are spending less, and then fears about these Trump 0:01:48.600 --> 0:01:51.760 tariffs that are scheduled to kick in this coming Wednesday, 0:01:51.840 --> 0:01:55.960 July ninth. What do you see coming up on these 0:01:55.960 --> 0:01:57.200 big sales events? 0:01:57.520 --> 0:02:00.760 You know, you said it exactly right. They're really consumers 0:02:00.840 --> 0:02:04.600 are pulling back, and consumers are looking for deals. So 0:02:04.760 --> 0:02:07.400 what better way to find deals than on Amazon's Prime 0:02:07.480 --> 0:02:10.600 Day sales, which now is a four day event versus 0:02:10.600 --> 0:02:15.120 a two day event. Historically, deals matter, and hopefully these 0:02:15.200 --> 0:02:19.600 deals draw consumers to Amazon to buy what they want. 0:02:20.240 --> 0:02:22.320 Now, this is a lot of money last year in 0:02:22.360 --> 0:02:26.079 twenty four American This is, according to eMarketer, fourteen point 0:02:26.120 --> 0:02:28.679 two billion dollars. And as you said, this was only 0:02:28.720 --> 0:02:31.960 Amazon had a two day sales event. This year, they've 0:02:31.960 --> 0:02:34.680 stretched it to four. Do you think we're going to 0:02:34.680 --> 0:02:36.320 see that kind of spending. 0:02:36.560 --> 0:02:39.640 I think spending will be up double digits, including on 0:02:39.680 --> 0:02:42.320 this Prime Day. Now, the fact that it's four days 0:02:42.320 --> 0:02:45.040 and two days, does that mean that you double what 0:02:45.040 --> 0:02:48.920 you're expected to get? Probably not double, because there is 0:02:49.000 --> 0:02:52.119 spending that still occurs right on the Amazon platform after 0:02:52.200 --> 0:02:54.880 Prime Day. But I think what this helps do is 0:02:54.880 --> 0:02:57.720 if you think about what's happened since Amazon has introduced 0:02:57.760 --> 0:03:01.200 Prime Day, is that other retailers, as you have followed suit. 0:03:01.560 --> 0:03:04.840 So Walmart has its deals, Target has its steals, Best 0:03:04.880 --> 0:03:08.320 by Wayfair, you name it. But these deals aren't just 0:03:08.400 --> 0:03:12.240 two days, they're longer. So by Amazon going from two 0:03:12.360 --> 0:03:16.120 days to four days, they're now in play along with 0:03:16.160 --> 0:03:18.799 the rest of them for a longer duration. I think 0:03:18.840 --> 0:03:20.160 that's really what helps here. 0:03:20.400 --> 0:03:23.680 And Target is seven days, Walmart is a six day event. 0:03:23.760 --> 0:03:26.000 I mean, they are real. They're really stretching things here, 0:03:26.080 --> 0:03:26.519 aren't they. 0:03:26.680 --> 0:03:29.560 Yeah? Exactly, So you know, Amazon being just two days. 0:03:29.560 --> 0:03:31.880 I think it's smart of them to go to four days, 0:03:31.919 --> 0:03:34.400 and I do think it'll help them draw higher sales 0:03:34.440 --> 0:03:35.680 because it is a longer event. 0:03:36.200 --> 0:03:39.720 Now, Amazon did something I think really smart this year. 0:03:39.760 --> 0:03:42.920 They moved up the dates. Last year, i'll say there 0:03:42.960 --> 0:03:45.880 was a two day event. It started July sixteenth. This 0:03:46.000 --> 0:03:49.440 year it's starting July ninth, and that's an important day 0:03:50.000 --> 0:03:52.800 because that's the day that the across the board Trump 0:03:52.880 --> 0:03:55.360 tariffs are supposed to kick in, and we know anything 0:03:55.360 --> 0:03:59.520 could change before then. But I think it's a savvy 0:03:59.600 --> 0:04:03.600 move to move this up because people are afraid. People 0:04:03.640 --> 0:04:06.440 are worried. There's a lot of uncertainty about those tariffs, 0:04:06.440 --> 0:04:09.960 how much it's going to change, you know, prices on things, 0:04:10.600 --> 0:04:14.040 inflation rising, and it looks like everybody else has followed suit. 0:04:15.360 --> 0:04:18.279 Yeah, you're absolutely right. Look, that day is clearly going 0:04:18.279 --> 0:04:20.120 to be an important day and we'll find out what 0:04:20.160 --> 0:04:23.040 happens with tariffs. But as tariffs are top of mind 0:04:23.080 --> 0:04:25.800 on that day, consumers are also at the tip of 0:04:25.839 --> 0:04:29.480 their seats looking for deals because if things do change 0:04:29.800 --> 0:04:32.320 and if things get more expensive for the consumer, they're 0:04:32.320 --> 0:04:34.280 going to want to buy it now. And the Prime 0:04:34.320 --> 0:04:36.479 day sale happens to be just that day and for 0:04:36.520 --> 0:04:37.560 the next four days. 0:04:38.120 --> 0:04:41.200 Now, this started kind of the dog days of summer. 0:04:41.560 --> 0:04:43.839 People were not spending a lot of money. It started 0:04:43.880 --> 0:04:47.919 in twenty fifteen with Amazon, and they've grown into maybe 0:04:48.400 --> 0:04:52.360 stretching out not only back to school sales, they've early 0:04:52.440 --> 0:04:56.400 those up. I mean, this has really become an annual 0:04:56.760 --> 0:05:00.159 event along the lines of Black Friday, hasn't it all 0:05:00.200 --> 0:05:01.800 these retailers and consumers. 0:05:02.760 --> 0:05:06.240 Absolutely, the Prime Day sale is a big event. It's 0:05:06.320 --> 0:05:08.920 not as big as Black Friday, but still a very 0:05:08.920 --> 0:05:11.520 big event, and it comes at a key shopping point 0:05:11.560 --> 0:05:13.760 in time, right it's right ahead of back to school, 0:05:14.080 --> 0:05:16.760 So consumers have the intent to shop, they have the 0:05:16.920 --> 0:05:20.320 urgency to shop, they have the need to shop, and 0:05:20.400 --> 0:05:23.760 this year especially, they want the deals right. They're looking 0:05:23.839 --> 0:05:27.560 to spend less and get more and the only way 0:05:27.600 --> 0:05:29.880 to do that is to go shop on Dal Days. 0:05:29.960 --> 0:05:33.920 And this is one of Amazon's biggest deal days outside 0:05:34.000 --> 0:05:34.960 of Black Friday. 0:05:35.720 --> 0:05:39.120 Now, Amazon now has two hundred and twenty million subscribers, 0:05:39.240 --> 0:05:42.960 and really to get the full benefits of these Prime Days, 0:05:43.040 --> 0:05:45.320 you have to be a subscriber. What kind of deals 0:05:45.320 --> 0:05:47.520 are we talking about and are there ones that stick 0:05:47.560 --> 0:05:51.680 out to you that you've seen that could really really 0:05:52.080 --> 0:05:53.520 have a big impact on sales. 0:05:54.360 --> 0:05:56.919 So we'll see the deals this week when you know. 0:05:56.960 --> 0:05:59.160 Amazon starts launching them this year. They're doing it a 0:05:59.200 --> 0:06:03.360 little differently. They're dropping new deals every day on different categories. 0:06:03.680 --> 0:06:06.600 So they're being very targeted in how they get consumers 0:06:06.640 --> 0:06:08.719 to keep coming back. Right, you don't want to go 0:06:08.760 --> 0:06:10.320 shop the first day and then not come back the 0:06:10.360 --> 0:06:13.279 second day. So they're being targeted for their deals. In 0:06:13.360 --> 0:06:15.320 terms of what the deals will be, I think you're 0:06:15.360 --> 0:06:17.240 going to see the same as you've seen before. You're 0:06:17.240 --> 0:06:19.680 going to see deals on electronics. You're going to see 0:06:19.680 --> 0:06:22.760 deals on Amazon gadgets, whether it's a Kindle or any 0:06:22.800 --> 0:06:26.760 of their other devices. You're going to see them use 0:06:27.040 --> 0:06:32.240 their Rufus and Alexa AI assistance to help consumers find deals. 0:06:32.240 --> 0:06:35.080 So that's the real new thing here is that Amazon 0:06:35.120 --> 0:06:37.680 is going to try to have consumers lean into these 0:06:37.720 --> 0:06:41.560 AI tools not only just to compare products on their website, 0:06:41.680 --> 0:06:44.880 but also to learn about them, get smarter, and really 0:06:44.880 --> 0:06:47.440 see the value in them to help them hit Dappa 0:06:47.560 --> 0:06:48.279 and buy now. 0:06:48.880 --> 0:06:52.200 Our thanks to Punamgoyle, Senior US e Commerce and retail 0:06:52.240 --> 0:06:56.440 analysts at Bloomberg Intelligence. We turn out to the airline 0:06:56.480 --> 0:06:59.960 industry with the latest earnings from Delta Airlines, out on Thursday, 0:07:00.240 --> 0:07:02.760 just as the summer travel season is in full swing 0:07:03.320 --> 0:07:06.640 or is it for more. We're joined by George ferguson Airlines, 0:07:06.680 --> 0:07:11.440 Aerospace and Defense, senior analyst with Bloomberg Intelligence. Well, George, 0:07:11.480 --> 0:07:13.520 thank you for being here. I want to start with 0:07:13.680 --> 0:07:16.400 what you expect to see from Delta second quarter earnings 0:07:16.400 --> 0:07:19.520 this week, which comes after blowout earnings for Q one 0:07:19.560 --> 0:07:22.120 three months ago. But since then, I think we both 0:07:22.120 --> 0:07:24.600 agree a lot has changed in the industry. 0:07:25.280 --> 0:07:27.800 It has, and thanks for having me on. Delta is 0:07:27.800 --> 0:07:32.160 always the first airline to report and usually one of 0:07:32.200 --> 0:07:36.080 the stronger airlines in the US industry, and we'd expect 0:07:36.080 --> 0:07:38.720 the same this time. I think you know, the big 0:07:38.760 --> 0:07:42.920 things that we're going to watch is first US domestic travel. 0:07:42.960 --> 0:07:46.760 We think US domestic travel is probably cooling. It's the 0:07:46.800 --> 0:07:51.080 biggest driver of revenues profits for the airlines, and so 0:07:51.240 --> 0:07:54.160 to give us a good sense for how much that 0:07:54.280 --> 0:07:57.320 is cooling right now, it's hard for these airlines to 0:07:57.360 --> 0:08:01.000 continue to push to higher profitability if that market isn't working. 0:08:01.040 --> 0:08:05.760 And we're expecting across the board that the US airlines 0:08:05.760 --> 0:08:09.080 are going to have lower profitability than last year. In 0:08:09.160 --> 0:08:12.480 the same quarter, we'll also get a first look at 0:08:12.600 --> 0:08:16.520 Europe during the summer vacation season that's been super strong 0:08:16.760 --> 0:08:20.800 for the big US full service carriers United, Delta, and American. 0:08:21.600 --> 0:08:23.680 You know, we suspect that this market's going to cool 0:08:23.720 --> 0:08:28.160 as well, although this is probably because of a slowing economy, 0:08:28.760 --> 0:08:31.600 the US dollar weakening a bit. We don't think it's 0:08:31.600 --> 0:08:33.560 going to fall off a cliff, but we just can't 0:08:33.559 --> 0:08:37.520 see it remaining as super strong as it has been. 0:08:38.320 --> 0:08:40.800 Kind of suspect that a lot of these travelers book 0:08:41.320 --> 0:08:43.400 pretty far in advance. I have sort of a joke 0:08:43.480 --> 0:08:46.880 that on Christmas Morning, everybody wakes up, opens their presence 0:08:46.920 --> 0:08:49.240 and then decides where they're going to travel to Europe 0:08:49.240 --> 0:08:52.200 that summer in the well heeled families of America, And 0:08:52.240 --> 0:08:54.200 so we suspect that two q' is probably going to 0:08:54.240 --> 0:08:57.360 hang in there pretty well. But we'll be listening closely 0:08:57.400 --> 0:09:02.120 for trends for three Q and into four Q because 0:09:02.240 --> 0:09:03.880 again we think there's a bit of a lag that 0:09:04.679 --> 0:09:09.000 occurs in bookings into Europe. We still think two Q 0:09:09.200 --> 0:09:14.160 may provide some insight into some potential softening in that market. 0:09:14.480 --> 0:09:16.320 And I think one of the challenges we'll also have 0:09:16.360 --> 0:09:18.880 as we look at Delta, like I said, is you know, 0:09:18.920 --> 0:09:22.720 we're expecting that domestic market to soften, and we'll see 0:09:22.760 --> 0:09:26.079 some of that in Delta's earnings, but it won't be 0:09:26.120 --> 0:09:29.400 a good indicator as good an indicator, but we expect 0:09:29.400 --> 0:09:32.679 that at the low cost carriers, because the low cost 0:09:32.720 --> 0:09:37.120 carriers really catering to a different clientele, we would expect 0:09:37.160 --> 0:09:41.319 that anything Delta reports on the domestic industry is going 0:09:41.400 --> 0:09:43.599 to be even softer when we get to some of 0:09:43.640 --> 0:09:48.640 the low costs like Jet Blue, Southwest Frontier, those kind 0:09:48.679 --> 0:09:49.240 of companies. 0:09:49.880 --> 0:09:53.400 Well back to Delta now, they telegraph this softening back 0:09:53.440 --> 0:09:56.679 in April their last earnings report, right where they withdrew 0:09:56.679 --> 0:09:59.960 a full year guidance because of softer demand. And since then, 0:10:00.200 --> 0:10:02.160 I mean, we've seen more unrest in the Middle East, 0:10:02.559 --> 0:10:06.320 these White House, you know, policies on migrants, travel bands, 0:10:06.720 --> 0:10:09.240 the Trump tariffs, I mean, have things even gotten a 0:10:09.280 --> 0:10:10.839 little worse than even you suspected? 0:10:11.040 --> 0:10:13.160 Yeah, I mean I think that the backdrop is getting 0:10:13.559 --> 0:10:16.280 is definitely getting more difficult. I don't know that they 0:10:16.480 --> 0:10:20.280 totally telegraphed more difficult times ahead. You know, the sense 0:10:20.320 --> 0:10:23.520 I got was at earnings there was just so much, 0:10:24.000 --> 0:10:26.920 so many things changing in the US right tariffs were 0:10:26.960 --> 0:10:29.839 being announced. Everybody wasn't sure what it was going to 0:10:29.880 --> 0:10:33.480 do to GDP that I think that the company has 0:10:33.559 --> 0:10:37.600 just decided that it was most prudent, maybe easiest, just 0:10:37.640 --> 0:10:40.839 to pull guidance for the year. But as we went 0:10:40.840 --> 0:10:42.520 through the call, there was you know, a lot of 0:10:42.520 --> 0:10:45.760 discussion about how they hadn't seen the softening yet in 0:10:45.840 --> 0:10:48.520 many of these markets. But again I agree with you. 0:10:48.559 --> 0:10:51.960 I think since then the backdrop has gotten a little 0:10:52.000 --> 0:10:55.280 bit worse on all those fronts. You know, again, I 0:10:55.280 --> 0:10:59.400 think commentary on the back half of the year won't 0:10:59.400 --> 0:11:01.640 be as strong. We'll be listening very closely for that, 0:11:02.440 --> 0:11:04.439 but all this takes time to filter through, and so 0:11:04.600 --> 0:11:04.880 too Q. 0:11:05.559 --> 0:11:06.480 You know, we expect it. 0:11:06.400 --> 0:11:09.880 To be okay, not more profitable than last year, but okay. 0:11:10.840 --> 0:11:14.200 Now, chances are, if you're traveling this summer, you've already 0:11:14.240 --> 0:11:17.360 made your flight and hotel bookings. But if not, could 0:11:17.440 --> 0:11:20.360 that mean right now it's July there are solid deals 0:11:20.360 --> 0:11:21.400 out there for consumers. 0:11:22.120 --> 0:11:25.920 Again, I think that some of the shortest distance between 0:11:26.120 --> 0:11:30.840 booking and travel is typically the domestic market. I would 0:11:30.840 --> 0:11:33.920 suspect that there's probably some interesting deals out there right 0:11:33.960 --> 0:11:35.800 now for the domestic market, because that's the one I 0:11:35.800 --> 0:11:39.320 think we'll get softest sooner. And then I think, you know, 0:11:39.400 --> 0:11:42.239 you'll see the airlines discount that try to fill those airplanes. 0:11:42.679 --> 0:11:44.720 You know, the way we see sort of revenue management 0:11:44.760 --> 0:11:48.280 at the airlines nowadays, all these carriers traditionally have sort 0:11:48.280 --> 0:11:52.439 of eight plus percent capacity of every airplane that flies. 0:11:52.960 --> 0:11:55.200 You know, those revenue managers will get out there and 0:11:55.240 --> 0:11:58.400 try to fill those airplanes at the marginal cost of 0:11:58.440 --> 0:12:00.640 the seat, and so, like I said, that means you 0:12:00.640 --> 0:12:04.360 could get some pretty interesting opportunities. I suspect on some 0:12:04.440 --> 0:12:08.840 of the international travel long haul Latin America, Asia, pac 0:12:09.040 --> 0:12:12.000 and Europe, I suspect still a good amount of those 0:12:12.000 --> 0:12:15.200 seats have been filled and filled earlier in the year, 0:12:15.400 --> 0:12:19.040 and so I think you'll see maybe less great deals 0:12:19.040 --> 0:12:22.520 in the marketplace for those, but you'll probably see some well. 0:12:22.559 --> 0:12:25.439 Delta Airlines Q two earnings out this Thursday ahead of 0:12:25.440 --> 0:12:28.880 Wall Street's opening bell our Thanks to George Ferguson, Senior analyst, 0:12:29.160 --> 0:12:33.280 for airlines, aerospace, and defense with Bloomberg Intelligence and coming 0:12:33.320 --> 0:12:36.280 up on Bloomberg day Break Weekend, JP Morgan Chase's Jamie 0:12:36.320 --> 0:12:40.080 Diamond visits Ireland head of the US tariff deadline for Europe. 0:12:40.200 --> 0:12:52.560 I'm Tom Busby and this is Bloomberg. This is Bloomberg 0:12:52.640 --> 0:12:54.680 day Break Weekend, our global look ahead at the top 0:12:54.720 --> 0:12:57.720 stories for investors in the coming week. I'm Tom Busby 0:12:57.720 --> 0:13:00.959 in New York. Up later in our program, China firms 0:13:01.040 --> 0:13:03.079 locked in a race to the bottom when it comes 0:13:03.120 --> 0:13:07.280 to pricing artificial intelligence. But first, Jamie Diamond, Chairman and 0:13:07.400 --> 0:13:10.480 CEO of JP Morgan, visits Ireland this week, just ahead 0:13:10.520 --> 0:13:13.960 of this Wednesday's July ninth deadline for US tariffs, which, 0:13:14.080 --> 0:13:17.160 if they go ahead as planned, would add fifty percent 0:13:17.240 --> 0:13:21.040 duties to most European goods exported to the US. Ireland, 0:13:21.160 --> 0:13:24.960 a major beneficiary of global economic integration. That's, according to 0:13:25.000 --> 0:13:29.280 the Finance Minister, is aiming to maintain formidable growth while 0:13:29.320 --> 0:13:33.920 balancing European interest with its traditionally strong relationship with America. 0:13:34.160 --> 0:13:37.480 For more, we turn to Bloomberg Daybreak anchor Caroline Hepger 0:13:38.000 --> 0:13:38.880 in the midst. 0:13:38.760 --> 0:13:41.760 Of a boom in Europe's banking sector. JP Morgan, Chair 0:13:41.800 --> 0:13:44.160 and CEO Jamie Diamond, will head to Dublin for talks 0:13:44.200 --> 0:13:47.160 with the country's second in command on trade, tariffs and 0:13:47.200 --> 0:13:51.800 sustaining economic growth the Banking Store. We'll meet with Ireland's 0:13:51.920 --> 0:13:55.840 tournished in effect, the Deputy Prime Minister. Just as geopolitical 0:13:55.920 --> 0:14:01.440 uncertainty both drives interest in Ireland's goldilock business climate but 0:14:01.559 --> 0:14:05.480 also could pose threats to its tech and farmer industry. Well, 0:14:05.559 --> 0:14:09.040 joining me now to discuss is Olivia Fletcher, Boomberg's Dublin 0:14:09.080 --> 0:14:12.640 bureau reporter, and here in London Blueberg Senior finance reporter 0:14:12.840 --> 0:14:15.400 Laura Noonan. Welcome to both of you and thanks for 0:14:15.440 --> 0:14:19.200 being with me. Olivia. To you first. Jamie Diamond has 0:14:19.400 --> 0:14:22.960 raised the alarm on macroeconomic risk, on bond markets, on 0:14:23.080 --> 0:14:26.360 tariff uncertainty. What do you think he's going to be 0:14:26.600 --> 0:14:30.200 talking about and thinking about when he's in Ireland. How 0:14:30.280 --> 0:14:33.480 much is Ireland at a risk from all of these Well. 0:14:33.520 --> 0:14:39.200 Big question now is how Ireland could remain competitive. You know, 0:14:39.280 --> 0:14:43.320 its whole economic model has been based off attracting and 0:14:43.360 --> 0:14:47.360 knowing foreign direct investment internationally, got especially from a lot 0:14:47.400 --> 0:14:50.320 of US firms. There are a lot of multinational hubs here, 0:14:50.800 --> 0:14:54.720 Apple Visor, a lot of the investment banks here as well, 0:14:55.080 --> 0:14:59.240 And the key is going to be staying competitives because 0:15:00.280 --> 0:15:02.520 was basically the envy of Europe. You know, it's got 0:15:02.480 --> 0:15:07.800 this huge budgets. Last year reaped record thirty nine billion 0:15:07.880 --> 0:15:11.680 euros in corporate tax receipts. Albeit they are kind of volatile, 0:15:11.760 --> 0:15:15.040 but that's a huge, huge amount of money that has 0:15:15.120 --> 0:15:18.960 transformed it from one of europe'spores to one of its richest. 0:15:19.120 --> 0:15:21.920 But now it's kind of make an headvise, I guess 0:15:22.080 --> 0:15:25.239 for maybe the wrong reasons, because Arland is now directly 0:15:25.320 --> 0:15:28.040 in Trump's line of sight. It has one of the 0:15:28.080 --> 0:15:31.600 biggest trade imbalances with the US, and Howard Lutnick has 0:15:31.720 --> 0:15:36.040 repeatedly singled out Land for its huge SURFLUS. So big question, 0:15:36.240 --> 0:15:39.520 I guess is how does Ireland continue to attract and 0:15:39.600 --> 0:15:44.880 maintain the foreign direct investment that's kind of funded its coffers, 0:15:45.000 --> 0:15:47.160 just as Trump is trying to nawse so many of 0:15:47.200 --> 0:15:49.600 those US companies back to American shores. 0:15:50.160 --> 0:15:54.040 Laura A lot of uncertainty then around tariffs and trade 0:15:54.080 --> 0:15:55.920 and what that means for Ireland, there. 0:15:55.840 --> 0:15:57.800 Is certainly a lot of uncertainty. What I would say 0:15:57.920 --> 0:16:01.840 is Ireland has tried to tread very fine line around 0:16:02.520 --> 0:16:06.240 Turfs and around the current Trump administration. So Ireland's always 0:16:06.240 --> 0:16:08.920 been in a particular position. I think where it is 0:16:09.120 --> 0:16:11.600 economically and politically is also similar to where it is 0:16:11.600 --> 0:16:14.920 from a geographic perspective. It is midway between it itself 0:16:14.920 --> 0:16:17.760 has been between the EU and between the US, and 0:16:17.800 --> 0:16:21.880 there has always been close ties between Ireland and the US, 0:16:21.920 --> 0:16:24.440 some of which predate Ireland's EU membership. So I think 0:16:24.480 --> 0:16:26.680 Ireland is trying to play a very fine line here. 0:16:27.000 --> 0:16:30.960 They are very conscious of not wanting to alienate the 0:16:31.080 --> 0:16:36.360 US administration anymore than is definitionally necessary. Because Ireland does 0:16:36.400 --> 0:16:38.800 have a low corporate tax base, that low corporate tax 0:16:38.840 --> 0:16:42.040 base has attracted a lot of multinational activity, a lot 0:16:42.040 --> 0:16:45.280 of US activity, which the US administration believes should be 0:16:45.360 --> 0:16:48.520 in the US. So that is a definitional problem. But 0:16:48.760 --> 0:16:52.400 beyond that, Ireland is trying to position itself as a 0:16:52.520 --> 0:16:55.680 friend to the US while also being a good European 0:16:56.000 --> 0:16:59.560 So you won't see the Irish administration making the same 0:16:59.640 --> 0:17:03.520 kind of combative statements as what you have seen some 0:17:03.560 --> 0:17:06.320 of the other eunations doing. In terms of Jamie coming 0:17:06.359 --> 0:17:09.840 to Ireland and Jamie Diamond, JP Morgan, Chase CEO, Jamie 0:17:09.880 --> 0:17:12.119 loves Ireland. That's the first thing to say. There are 0:17:12.160 --> 0:17:16.640 sometimes it's several times, there are some Americans who love Ireland. 0:17:16.840 --> 0:17:19.760 Jamie is one of those. So he loves Ireland. I 0:17:19.760 --> 0:17:23.240 think he will be stressing the benefits our of the 0:17:23.240 --> 0:17:26.040 Irish economy. He'll be spress stressing all the great things 0:17:26.560 --> 0:17:29.840 that the Irish landscape has delivered for JP Morgan, They've 0:17:29.880 --> 0:17:31.920 already got a couple of thousand people there. One of 0:17:31.960 --> 0:17:34.639 the jokes about Jamie coming to Ireland is that Jamie 0:17:34.640 --> 0:17:36.760 will come to Ireland to promise a couple of thousand 0:17:36.800 --> 0:17:38.639 jobs and then it's up for everyone else to figure 0:17:38.640 --> 0:17:40.159 out how to make that happen, or like how to 0:17:40.200 --> 0:17:42.679 walk that back. Like he just loves the place. So 0:17:42.760 --> 0:17:45.760 I think he will be stressing the strengths of Ireland 0:17:46.119 --> 0:17:48.680 and also trying to encourage Ireland to stay the path. 0:17:48.680 --> 0:17:51.920 From a stability perspective, one of the other assets Arreold 0:17:51.960 --> 0:17:54.639 has had through the recent geopolitical ups and downs is 0:17:54.640 --> 0:17:57.200 that there have been a lot of big elections. There's 0:17:57.240 --> 0:17:59.119 been a lot of political shifts in a lot of 0:17:59.119 --> 0:18:02.119 big countries and the UK. So last year we had 0:18:02.119 --> 0:18:04.400 elections and a lot of major EU countries. We had 0:18:04.440 --> 0:18:07.359 elections in the US, there was a lot of public 0:18:07.400 --> 0:18:11.080 talk about that. Internationally, we also had Irish elections. Nobody 0:18:11.119 --> 0:18:14.600 cared because essentially they rearranged the chairs in a very 0:18:14.600 --> 0:18:16.560 similar order to the old chairs. And I think that 0:18:16.640 --> 0:18:20.240 stability as well has become an asset. So while it 0:18:20.240 --> 0:18:22.800 doesn't make Olivia's life uny easier in trying to excite 0:18:22.800 --> 0:18:26.479 people about the Irish elections, it does become a selling 0:18:26.560 --> 0:18:30.640 point when you think about companies like JP Morrigan, who 0:18:30.720 --> 0:18:33.120 in this world have a lot of uncertainty. I think 0:18:33.160 --> 0:18:36.280 people do look for stability, and I think Jamie will 0:18:36.320 --> 0:18:38.600 be stressing the stability they have found in Ireland and 0:18:38.640 --> 0:18:41.520 will be encouraging the country to continue on that route. 0:18:41.640 --> 0:18:44.560 And of course some of these points were reflected in 0:18:44.600 --> 0:18:48.640 some recent interviews that we've had, including my Daybreak Europe 0:18:48.680 --> 0:18:52.159 co host co Ankers Stephen Carroll, who sat down with 0:18:52.200 --> 0:18:56.480 the Irish Finance Minister Pascal Donacue when Bloomberg opened its 0:18:56.560 --> 0:18:59.639 brand new bureau in Dublin. So have a listen to 0:18:59.680 --> 0:19:01.080 what on a Hue had to say. 0:19:01.440 --> 0:19:04.200 We have a growth outlook for our economy even now 0:19:04.560 --> 0:19:07.960 of to maybe even more than two percent per year. 0:19:08.560 --> 0:19:11.800 The reason why these companies have part of their global 0:19:11.880 --> 0:19:15.040 supply chains here in Ireland is because we have the skill, 0:19:15.320 --> 0:19:19.000 the experience and the competitiveness built up to keep them 0:19:19.000 --> 0:19:21.280 in our country, and we will look down at how 0:19:21.320 --> 0:19:24.600 we can maintained us even if the trade environment around 0:19:24.600 --> 0:19:25.840 it does begin to change. 0:19:26.040 --> 0:19:29.800 So quite a rosy vision then for Ireland's economy, despite 0:19:30.119 --> 0:19:35.840 the trade worries from Donahue Olivia, in terms of you know, 0:19:35.920 --> 0:19:39.440 the reliance as you say, on corporate tax receipts from 0:19:40.160 --> 0:19:43.720 large multinational companies, and also what the government is going 0:19:43.760 --> 0:19:47.240 to do with the budget surplus that it's got in 0:19:47.320 --> 0:19:50.560 terms of setting up a sovereign wealth fund. What are 0:19:50.600 --> 0:19:52.760 the next steps for the Irish government? 0:19:53.160 --> 0:19:56.720 Well, like you say, the picture is perhaps not as 0:19:56.800 --> 0:20:00.159 rosy as it once. You know, his Finance Department and 0:20:00.400 --> 0:20:03.680 has revised an it's domestic economic outlook, and so has 0:20:03.680 --> 0:20:06.320 a central bank. You know, the kind of saying that 0:20:07.040 --> 0:20:11.520 while Arland will still see a star plus, the selflus 0:20:11.760 --> 0:20:14.960 might not be as high as you know, it was 0:20:14.960 --> 0:20:17.919 once anticipated to be. And so the next steps for 0:20:18.240 --> 0:20:21.359 the Irish administration are, like I say, to continue to 0:20:21.480 --> 0:20:25.600 keep that competitive edge, you know, the Finance Department and 0:20:25.720 --> 0:20:29.080 you know, and also Arland's for Indirect Investment Agency. The 0:20:29.119 --> 0:20:31.800 idea that keen to stress that while Land has in 0:20:31.840 --> 0:20:35.000 the parson have attracted these companies because they are a 0:20:35.040 --> 0:20:38.800 strategic tax space. You know, Arland also has a hugely 0:20:39.000 --> 0:20:42.520 skilled workforce, and like Law has said as well. Actually 0:20:42.560 --> 0:20:44.679 when I went to see the idea recently when the 0:20:44.760 --> 0:20:48.439 press conferences, their chair said that Arland stands out as 0:20:48.480 --> 0:20:52.760 an oasis of stability to investors. So I think the 0:20:52.840 --> 0:20:56.000 key thing for Arland is to you know, remain stable, 0:20:56.040 --> 0:20:57.720 which seems like that's something they'll be able to do, 0:20:57.880 --> 0:21:01.000 and to continue squirrel and away some of that money 0:21:01.000 --> 0:21:04.200 into the sovereign welfare because Island isn't just thinking about 0:21:04.240 --> 0:21:09.080 the next three four years. The problems potentially could come 0:21:09.200 --> 0:21:11.879 you know, ten years down the line, when you know, 0:21:11.960 --> 0:21:15.119 for example, a company might not pull out of Island 0:21:15.200 --> 0:21:17.600 right away, but they might just decide not to invest 0:21:17.800 --> 0:21:20.240 in a pharmaceutical plant in ten years time. So the 0:21:20.280 --> 0:21:22.760 issue isn't necessarily that all these companies are going to 0:21:22.800 --> 0:21:25.639 lead right away, it's that what might just not be 0:21:25.720 --> 0:21:27.879 there in future, which is harder to measure. So you know, 0:21:27.960 --> 0:21:29.840 Ireland is having to look at all kinds of other 0:21:29.840 --> 0:21:33.040 ways to continue to attract companies. Also invest more in 0:21:33.119 --> 0:21:35.639 research and development. That's quite another thing that's hyped up 0:21:35.680 --> 0:21:37.160 on their agenda, things like that. 0:21:37.359 --> 0:21:41.000 Lord to bring you the context also amidst all of 0:21:41.040 --> 0:21:44.240 this is that European banks have done incredibly well in 0:21:44.280 --> 0:21:46.280 the first half of this year, so there's also that 0:21:46.359 --> 0:21:49.640 context to kind of bring into to this that European 0:21:49.640 --> 0:21:52.200