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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Blueberg Day BAQ podcast. Good morning, It's Friday,

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Speaker 2: the eleventh of July. I'm Caroline Hebket in London.

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Speaker 1: And I'm Stephen Carolin Brussels. Coming up today. US President

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Speaker 1: Donald Trump raises the prospect of higher global tariffs after

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Speaker 1: threatening Canada with a thirty five percent rate on some goods.

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Speaker 2: JP Morgan's Jamie Darman tells European leaders they're losing to

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Speaker 2: the US and China as he warns of market complacency

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Speaker 2: over tariffs.

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Speaker 1: Plus the inside story of the former Morgan Stanley banker

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Speaker 1: shaking up Santander's wealth business and why not Everyone is Happy.

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Speaker 3: Let's start with a roundup of our top stories.

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Speaker 1: US President Donald Trump now says he's eyeing blanket tariffs

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Speaker 1: of fifteen to twenty percent on most trading partners. The

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Speaker 1: comments in a phone interview with NBC News would mark

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Speaker 1: a significant increase in the current US global baseline of

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Speaker 1: ten percent. The President also reportedly dismissed concerns that further

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Speaker 1: tariffs could negatively affect stocks or inflation, pointing to recent

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Speaker 1: rises in the US equity market. Stefan Hoffer, Asia, chief

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Speaker 1: investment stratist at LGT Bank says in the long term,

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Speaker 1: the impact of tariffs is far harder to assess.

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Speaker 4: Frankly, we are in uncharted territory. We've never seen anything

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Speaker 4: like this. There is no playbook for this. We've gone

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Speaker 4: from an effective import tariff pre President Trump's second second

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Speaker 4: presidency of just below two percent to the Liberation Day

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Speaker 4: twenty seven percent down to you know, it's a moving

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Speaker 4: target and these kind of distortions are very, very difficult

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Speaker 4: to map out onto a model where we land finally.

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Speaker 1: Stefan Hoffer speaking there as US stock futures have turned

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Speaker 1: weaker and the greenback has climbed against major piers on

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Speaker 1: the Latest News Well.

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Speaker 2: Separately, in a post on truth Social Trump said that

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Speaker 2: the US will impose a tariff of thirty five percent

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Speaker 2: on Canadian products starting on the first of August. Now

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Speaker 2: that will be ten percent higher than the current rate

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Speaker 2: applied to all goods not covered under the existing US

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Speaker 2: Mexico Canada free Trade Agreement. Bloomberg's Jill Desis says the

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Speaker 2: White House is so far signaling that the free trade

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Speaker 2: agreement holds this.

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Speaker 5: US and CA that the trade agreement between the US

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Speaker 5: and Canada and Mexico that those goods aren't included in

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Speaker 5: this thirty five percent tariff threat. I think that's really

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Speaker 5: really important because what that ultimately tells us then is

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Speaker 5: that what Trump's ultimately doing. It appears, and again I

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Speaker 5: have to caution this is a very quickly evolving story,

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Speaker 5: but what that does mean potentially is that this is

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Speaker 5: essentially a ten percent tariff increase over a group of

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Speaker 5: goods that were covered already with a twenty five percent tariffs.

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Speaker 2: Bloombergs, Gilds is there in response to the US person's threat,

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Speaker 2: Canada's Prime Minister, Martin Karney so that he would continue

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Speaker 2: to defend workers and businesses. A large proportion of Canada's

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Speaker 2: exports to the US do fall under the rules of

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Speaker 2: the USMCA, so would be unaffected by the new rate.

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Speaker 1: I mean, while Jamie Diamond is sounding a warning about

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Speaker 1: the muted market reaction to tariffs. Speaking at an event

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Speaker 1: in Dublin hosted by Ireland's Foreign Ministry, the JP Morgan

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Speaker 1: CEO said, unfortunately, I think there is complacency. The Wall

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Speaker 1: Street stalwart also weighed in and what he believes is

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Speaker 1: a major European competitiveness problem, as Bimbrooks Crispets reports.

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Speaker 6: You're losing. That's the stark assessment of Jamie Diamond, who

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Speaker 6: says the EU has a huge problem at the moment

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Speaker 6: when it comes to competitiveness, citing the region's sluggish growth.

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Speaker 6: The JP Morgan boss pointed out that Europe's economic weight

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Speaker 6: has declined significantly, falling from ninety percent of USGDP to

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Speaker 6: just over sixty five percent in the past ten to

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Speaker 6: fifteen years. He says the best way to reverse that

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Speaker 6: decline is to build an internal market that functions more

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Speaker 6: effectively across all industries. Diamonds comments come as the EU

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Speaker 6: seeks to conclude an intram trade deal with the US

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Speaker 6: that could allow the block to lock in a ten

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Speaker 6: percent tariff rate beyond the August first deadline as they

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Speaker 6: negotiate a permanent agreement in London Crispit Bloomberg Radio.

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Speaker 2: French Prime Minister Francois Beroux has called on the European

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Speaker 2: Central Bank to do more to support the economy as

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Speaker 2: his government struggles to contain a budget deficit and slowing

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Speaker 2: growth in France. In an interview with LC Television, Beayrou

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Speaker 2: said he dreams of the ECB, quote feeling it has

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Speaker 2: a role to play for growth in the EU, in

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Speaker 2: other words, to support activity rather than putting brakes on it.

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Speaker 2: He added that rate cuts were a possible option. His

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Speaker 2: comments represent a rare critique of the Central Bank, which

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Speaker 2: has already delivered eight cuts in a year to bring

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Speaker 2: boring costs to two percent. During a contrast between the

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Speaker 2: ECB and the Federal Reserve, Beairu said that France faces

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Speaker 2: similar challenges to the US, but without the strong dollar

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Speaker 2: that gives the FED the option to create money and

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Speaker 2: fuel optimism in the economy.

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Speaker 1: UK's Prime Minister Kiir Starmer says he's agreed to what

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Speaker 1: he calls a groundbreaking deal to return small boat migrants

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Speaker 1: to France. The British leaders agreed to a pilot's scheme

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Speaker 1: with the French President Emmanuel Macrart Downing Street. He says

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Speaker 1: the agreement will mean for every person sent back, the

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Speaker 1: UK will accept an asylum seeker who hasn't attempted an

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Speaker 1: illegal crossing.

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Speaker 7: This will show others trying to make the same journey

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Speaker 7: that it will be in vain, and the jobs they've

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Speaker 7: been promised in the UK will no longer exist because

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Speaker 7: of the nationwide crackdown we're delivering on illegal working.

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Speaker 1: Starmer has been politically damaged by record numbers of people

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Speaker 1: crossing the English Channel in small boats. Roughly twenty one

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Speaker 1: thousand illegal migrants have made the journey so far this year.

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Speaker 2: President Donald Trump says that he plans to make a

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Speaker 2: major state went on Russia on Monday, as the US

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Speaker 2: prepares to send more American weapons to Ukraine paid for

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Speaker 2: by NATO allies. In a telephone interview with NBC News,

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Speaker 2: Trump said that he also expects the Senate to pass

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Speaker 2: a quote biting sanctions bill on Russia after he criticized

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Speaker 2: Vladimir Putin for his continued attacks on Ukraine. Russia has

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Speaker 2: been pounding Kiev and other Ukrainian cities with record numbers

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Speaker 2: of drones and missiles. Ukrainian President Vladimir Zelinski was optimistic

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Speaker 2: though about more aid, at a meeting of US and

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Speaker 2: European allies in Rome.

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Speaker 8: We must stop Russian droms and missiles, and these means

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Speaker 8: more air defense supplies and more investments in interceptor drowns,

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Speaker 8: air defense systems, and of course fissans and I urged

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Speaker 8: all our partners, increase your investments when Russia increases its attacks.

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Speaker 8: We cannot have a shortage of funding for drum production.

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Speaker 2: And Zelinsky speaking there at the Ukraine Recovery Conference in Rome,

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Speaker 2: where allies announced more than ten billion euros in additional funding,

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Speaker 2: the Ukrainian leader said that he since had a positive

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Speaker 2: dialogue with President Trump over the delivery of Patriot air

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Speaker 2: defense batteries with.

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Speaker 1: Those are your top stories on the markets. The Bloomberg

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Speaker 1: Dollar Spot Index two tenths stronger this morning, so the

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Speaker 1: Euro is weaker at one sixteen seventy seven, the pound

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Speaker 1: at one thirty five fifty seven. The Canadian dollar is

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Speaker 1: three tenths weaker this morning at one thirty six ninety seven.

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Speaker 1: On equity markets, after the record finished the S and

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Speaker 1: P five hundred yesterday, features are two tenths lower for

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Speaker 1: SMP Emini's European stop futures down two tenths of one

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Speaker 1: percent this morning as well.

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Speaker 2: In a moment, more on how markets are reading the

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Speaker 2: latest moves by Donald Trump on trade, plus the rising

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Speaker 2: style banker who is shaking things up at a traditionally

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Speaker 2: stayed unit of Spain's Santander. But before we get to

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Speaker 2: that a word on our story that we've been reading

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Speaker 2: about this morning. The UK is set to end issuing

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Speaker 2: of paper share certificates.

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Speaker 1: Yeah, this is a story for our colleagues Joe Mays

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Speaker 1: and Tom Reese saying the Chancellor is going to announce

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Speaker 1: this in the her Mansion House speech next week. It's

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Speaker 1: something that the industry has long sought. It's been an

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Speaker 1: end of an era though. I mean, this has been

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Speaker 1: a tradition that's been around for four hundred years. You

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Speaker 1: get a paper certificate when you have a share, and

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Speaker 1: there's a paper registry to log all of these as well.

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Speaker 1: And essentially this is part of a digital shift happens

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Speaker 1: in other parts of the world. It's enforced in the

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Speaker 1: European Union since the start of this year for existing

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Speaker 1: securities and going back to try to tage three for

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Speaker 1: new shares being issued as well. It's been recommended for

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Speaker 1: a long time. It's going to, according to the Chancellor,

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Speaker 1: going to reduce the costs for business and sports. We're

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Speaker 1: going to have to hold these paper certificates.

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Speaker 3: No, I mean, look, I get the argument right.

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Speaker 2: It would be much but much better to digitize if

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Speaker 2: it's quicker and cheaper. Although having a share certificate, you know,

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Speaker 2: if you want to get into the weeds of it,

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Speaker 2: it does give you a direct relationship with the company,

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Speaker 2: right they have to write to you, and then you

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Speaker 2: get to go to the AGM, you get to vote

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Speaker 2: and so on. So you know, there is obviously that

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Speaker 2: bizire of people that if you go, if you digitize it,

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Speaker 2: that you keep the same rights if you're a shareholder.

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Speaker 1: It also makes less exciting if you move into a

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Speaker 1: new house and you're clearing out an attic and you

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Speaker 1: can find a box with things in it that doesn't

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Speaker 1: you know that's not going to happen anymore.

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Speaker 2: Yeah, exactly listen that you know, maybe that Sharon Apple,

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Speaker 2: that's somebody buried.

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Speaker 3: Yeah, it would be quite useful, now, wouldn't it.

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Speaker 1: Thought exactly. Well, let's get back to the market's conversation

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Speaker 1: around how investors are thinking about the latest set of

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Speaker 1: trade headlines. So Donald Trump ramping up his rhetoric when

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Speaker 1: it comes to Canada, threatening those higher tariffs and saying

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Speaker 1: the EU may get a tariff letter as soon as today.

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Speaker 1: On Markets Life Strash as Mark Cranfield is with us

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Speaker 1: for more. Mark, great to talk to you. Can you

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Speaker 1: just explain to us how markets reacted to those Canada headlines.

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Speaker 1: So we had the threat of a higher tariff, but

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Speaker 1: then some mitigation in maintaining the exceptions under the existing

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Speaker 1: trade deal.

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Speaker 9: Yeah, yet another whipplush day, especially the foreign exchange market.

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Speaker 9: You look at the Canadian do that's probably a good

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Speaker 9: example of how people have been reacting to it. We

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Speaker 9: saw the cadiing dollar weeken dramatically at first, and then

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Speaker 9: gradually clawback some of its strength as the bit more

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Speaker 9: information came through. It's still weaker on the day, but

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Speaker 9: nowhere near as bad as it was first thing. This morning,

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Speaker 9: the dollar is slightly firmer overall. But there is one

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Speaker 9: very clear interesting theme emerging in the foreign exchange market,

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Speaker 9: and that's the divergence between the Chinese yuan and the

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Speaker 9: Japanese yen. They're going in opposite directions, and that just

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Speaker 9: shows that traders are looking beyond tariffs. There's also local

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Speaker 9: themes that play as well. You've got the Chinese central

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Speaker 9: bank supporting its currency, wants to have a strong, stable currency,

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Speaker 9: and then you've got local issues in Japan. They're coming

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Speaker 9: up towards upper house elections, which look as though it's

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Speaker 9: going to be a very close call. No one's too

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Speaker 9: sure how it's going to go. And then Japan struggle

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Speaker 9: to try and get a trade deal with the United States,

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Speaker 9: which doesn't seem to be moving forward very well, and

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Speaker 9: the yen is suffering because of that. So even within

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Speaker 9: all the choppy movements that we've seen today, we are

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Speaker 9: getting a bit of a theme appearing in the foreign

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Speaker 9: exchange market where the winners are graining a bit more traction,

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Speaker 9: the losers are just losing even more ground.

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Speaker 2: What do you think it tells us about how markets

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Speaker 2: are treating all of these trade headlines.

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Speaker 3: Is it fatigue frustration?

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Speaker 9: There's certainly a bit of headline fatigue on that the

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Speaker 9: fact that we often traders are used to hearing that

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Speaker 9: trade letters are going out or they're about to trawis

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Speaker 9: about to be imposed, but then there's a negotiation period,

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Speaker 9: so it doesn't actually hit straight away. So people are

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Speaker 9: getting used to the fact that they shouldn't read too

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Speaker 9: much into it, they shouldn't price it fully into the market,

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Speaker 9: and yet they need to some extent to be aware

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Speaker 9: of what's happening in there, and yet it's happening so frequently.

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Speaker 9: Of course, people are wondering whether or not they should

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Speaker 9: even trade it at all, particularly when you see things

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Speaker 9: like the US stock market continuing to grind higher, making

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Speaker 9: new records, Bitcoin making new records, and some parts of

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Speaker 9: the markets seemingly unaffected by what charists are doing at all.

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Speaker 9: So there's no uniformity anymore. If they go back to

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Speaker 9: say Liberation Day, when the whole Swaver things were first announced,

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Speaker 9: it was just negative across financial markets. The conditions have

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Speaker 9: changed quite a bit now. People are being more discerning

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Speaker 9: between different aspects of that, and that's something that's beginning

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Speaker 9: to play out a bit more.

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Speaker 1: Okay, Mark Crinfield, our market's life strastis thank you very

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Speaker 1: much for joining us.

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Speaker 2: To Spain now, where a former Morgan Stanley banker is

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Speaker 2: shaking up Santander's unique catering for the bank's richest customers

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Speaker 2: and not everyone is happy about it. Our Spanish equities

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Speaker 2: reporter Macarena Munuos Monjano joins us now for more on

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Speaker 2: this and welcome to the program. Macarena tell us about

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Speaker 2: Haavier Garcia Carranza, who he is and how he's changing

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Speaker 2: things to this part of Santander that were seen as

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Speaker 2: really quite stayed before.

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Speaker 10: Hi.

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Speaker 8: Good morning.

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Speaker 10: Yes. So the bank last year point at Ergatia Carranza

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Speaker 10: as the global head of its wealth unit, which includes

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Speaker 10: private banking, asset management and the insurance business. And he

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Speaker 10: has made some big changes at the unit. He used

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Speaker 10: to be an investment banker at Morgan Stanley and joined

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Speaker 10: the Spanish bank in twenty sixteen. So in his new

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Speaker 10: role he has changed a number of managers. He's cutting costs,

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Speaker 10: he's boosting some new businesses such as independent advisement in

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Speaker 10: private banking or the life and pension business in insurance.

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Speaker 10: So this unit is a relatively small one. It represents

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Speaker 10: like thirteen percent of the bank's profit, but it's a

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Speaker 10: very profitable one with a seventy percent return on tange

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Speaker 10: global equity. And the aim is that it keeps growing.

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Speaker 10: We hear these years should grow at a double digit.

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Speaker 1: Okay, now you've put apportioned that some bankers are nervous

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Speaker 1: about the changes that he's making in that unit.

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Speaker 10: Why well, So as part of the changes there are

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Speaker 10: some job cuts. We year, it's about ten percent of

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Speaker 10: the stuff in the unit. But also the bank is

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Speaker 10: hiring some top talent from other lenders, so they brought

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Speaker 10: a private banker from Julius bar They are also hiring

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Speaker 10: people from Caisher Bank, so it's kind of a mix.

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Speaker 10: But the net number is a ten percent reduction. So

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Speaker 10: that's why what it's causing the nervousness.

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Speaker 3: Okay, nervousness.

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Speaker 2: How do the changes then fit into the broader future

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Speaker 2: strategy in the picture for Santander.

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Speaker 10: Well, so this is a key area for the bank

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Speaker 10: as it looks to boost fees now that interest rates

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Speaker 10: are lower so and that is hurting the lending revenue.

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Speaker 10: So this is how so growing in fees is key

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Speaker 10: and this business of private banking, asset management and insurance

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Speaker 10: is a great fee generator. So this is a key

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Speaker 10: area for the bank.

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Speaker 1: Okay, Makarana, thank you very much for joining us. Makarnemnos Montano.

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Speaker 1: They're joining us from Madrid with the latest on that story,

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Speaker 1: and you can read the full story on Bloomberg dot

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Speaker 1: com and on the terminal as well of Macarenas reporting

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Speaker 1: rising star at Santander shakes up the bank's stayed wealth business.

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Speaker 1: A really interesting moment to be looking, of course at

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Speaker 1: how Santander is moving things around given the upheaval that

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Speaker 1: we've seen in so many parts of the European banking

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Speaker 1: sector of various talk about mergers and acquisitions as well.

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Speaker 1: In fact, even the commerce bank build for uniw Credit.

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Speaker 1: I note this morning that there's some commentary out of

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Speaker 1: one of the German ministers as well talking about that deal,

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Speaker 1: which we know has been quite controversial about. You know

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Speaker 1: that the German government has been kind of watching very

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Speaker 1: closely as as UNI Credit has been ramping up at

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Speaker 1: stake in commerce.

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Speaker 2: Bank, cross border deals in finance and banking. Controversial, yes,

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Speaker 2: still in Europe, that is the case.

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Speaker 10: You know.

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Speaker 2: It was a really interesting piece also because Girlcia Kranz

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Speaker 2: of course was here in London, based in London for

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Speaker 2: Morgus Stanley before going to Santander and shaking things up.

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Speaker 1: This is Bloomberg day Break Europe, your morning brief on

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