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Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

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Speaker 1: Daybreak Europe podcast. Good morning, It's Monday, the twenty seventh

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Speaker 1: of October. I'm Stephen Carroll in London. Coming up today,

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Speaker 1: Top trade negotiators for the US and China tea up

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Speaker 1: a sweeping trade deal ahead of a meeting between Trump

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Speaker 1: and she a one point one billion dollar hit. HSBC

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Speaker 1: joins other lenders and tallying the ballooning costs tied to

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Speaker 1: Bernie Madoff's Ponzi scheme. Plus why golds bumper returns are

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Speaker 1: delivering glittering pay packets for specialist traders amid a growing

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Speaker 1: talent war. Let's start with a roundup of our top stories.

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Speaker 1: Trade negotiators from China and the United States have reached

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Speaker 1: a series of agreements covering tariffs, shipping fees, fentanyl, and

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Speaker 1: export controls. The deals, concluded after two days of talks

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Speaker 1: in Malaysia, represent a significant easing of tensions following US

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Speaker 1: threats to impose one hundred percent tariffs on Chinese export

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Speaker 1: controls on rare earth minerals. US Treasury Secretary Scott Besson

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Speaker 1: told NBC's Meet the Press that Trump's tariff threats had

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Speaker 1: been key to securing the terms.

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Speaker 2: President Trump gave me a great deal of negotiating leverage

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Speaker 2: with the threat of the one hundred percent tariffs on

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Speaker 2: November first, and I believe we've reached some very substantial

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Speaker 2: framework that will avoid that and allow us to discuss

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Speaker 2: many other things with the Chinese.

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Speaker 1: Scott Beson's speaking to NBC's Meet the Press with President.

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Speaker 1: She and Trump now expected to sign off on the

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Speaker 1: agreements later this week when they meet in South Korea.

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Speaker 1: It will be the first in person meeting between the

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Speaker 1: two leaders since Donald Trump returned to the White House,

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Speaker 1: and Donald Trump's been speaking in the past few minutes

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Speaker 1: aboard Air Force One, saying that nothing has been agreed

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Speaker 1: yet on China, but feel good is how the President

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Speaker 1: is describing his sentiment as he approaches that meeting later

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Speaker 1: in the week toward the news Now, HSBC is setting

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Speaker 1: aside more than a billion dollars to cover legal costs

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Speaker 1: related to fraud claims dating back to two thousand and nine.

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Speaker 1: The bank joins other global firms which have been unexpectedly

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Speaker 1: hit recently with ballooning costs over decades old litigation. Bloomberg's

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Speaker 1: Tea out of Bio as More.

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Speaker 3: When financier Bernie Madoff's infamous Ponzi scheme fell apart in

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Speaker 3: two thousand and nine, customer statements reflected about sixty five

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Speaker 3: billion dollars in non existent investments. To this day, multiple

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Speaker 3: banks are still defending against litigation related to the case,

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Speaker 3: including HSBC. The firm has announced it will set aside

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Speaker 3: one point one billion dollars to cover litigation by investors

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Speaker 3: who lost money in the fraud. According to a statement

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Speaker 3: from the lender, the amount will have an impact on

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Speaker 3: the firm's capital reserves. In London t Bloomberg.

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Speaker 1: Radio, the UK's Deputy Prime Minister, David lamb Me says

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Speaker 1: a convicted sex offender who came into the country illegally

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Speaker 1: will be deported this week. The asylum seeker Hadouj Kabatu,

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Speaker 1: was accidentally released from prison on Friday, sparking a manhunt.

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Speaker 1: He was re arrested on Sunday, but David Lammy says

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Speaker 1: there will be lessons learned.

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Speaker 4: We need to get to the bottom of how this

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Speaker 4: happened and why it happened. Of course, on behalf of

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Speaker 4: the public, I want to be reassured that it won't

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Speaker 4: continue to happen, and that the systems that we put

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Speaker 4: in place, the checks and balances, are there to reassure

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Speaker 4: the public.

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Speaker 1: Lammie will speak in Parliament later today on the issue.

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Speaker 1: The incident has embarrassed the government as it tries to

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Speaker 1: show it can control migration with tougher border policies. A

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Speaker 1: former Bank of England governor says the Labor government lacks

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Speaker 1: a coherent economic strategy. Reverend King was asked by Sky

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Speaker 1: News if he could identify a Labor's economic plan.

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Speaker 5: No, I can't, and that's what worries me. And this

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Speaker 5: is true across a wide range of government policies. What

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Speaker 5: happens is the be our producers just before the budget

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Speaker 5: a number one number, and then they look round for

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Speaker 5: you know what, ideas almost written on the back of

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Speaker 5: a fat packet about how you can raise an extra

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Speaker 5: few billionaire or a few billion there. That is not

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Speaker 5: coherent tax strategy and you could do a great deal

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Speaker 5: by thinking it through first.

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Speaker 1: Mervin King was Governor of the UK Central Bank from

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Speaker 1: two thousand and three to twenty thirteen. He also took

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Speaker 1: aim at decades of what he described as tinkering with

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Speaker 1: the tax system. This as the Chancellor is preparing her

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Speaker 1: November budget, with businesses and the wealthy bracing for higher taxes.

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Speaker 1: In Argentina, President Hamlay's party is one mid term elections

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Speaker 1: and a major comeback for the libertarian leader. With more

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Speaker 1: than ninety percent of ballots counted, La Libertada Vansa has

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Speaker 1: over forty percent of the vote, well ahead of the

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Speaker 1: main opposition party. The victory follows a landslide defeat in

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Speaker 1: last month's local elections in Buenos Aires. That loss had

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Speaker 1: sparked concerns over Malay's political strength, triggering a sell off

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Speaker 1: in the peso and leading the United States to extend

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Speaker 1: a twenty billion dollar swap line to support the currency.

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Speaker 1: Addressing supporters, Malay said voters have now rejected what he

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Speaker 1: called the model of failure.

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Speaker 6: Argentinians showed that they don't want to return to the

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Speaker 6: model of failure, to the model of inflation, to the

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Speaker 6: model of monetary issuance, to the model of the useless state,

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Speaker 6: to the model of insecurity. Argentinians told populism to stop

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Speaker 6: populism never again.

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Speaker 1: President have Emla there speaking via a translator, and in

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Speaker 1: the midterm results secure enough seats for him to preserve

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Speaker 1: his veto power and advance plans for sweeping economic reforms.

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Speaker 1: French authorities have arrested several people over the heist at

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Speaker 1: the Louver Museum in Paris. The city's prosecutor says one

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Speaker 1: of those detained was planning to free the country. According

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Speaker 1: to local media reports, two of the suspects are experienced

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Speaker 1: burglars and they have been acting on orders. Police van

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Speaker 1: hunt for four people who broke into the Louver in

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Speaker 1: broad daylight just over a week ago. They stole eight

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Speaker 1: pieces of jewelry, including necklaces, trs and earrings. It remains

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Speaker 1: unclear if the stolen jewels have been recovered. And those

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Speaker 1: are our top stories on the markets. The MSCIASA Pacific

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Speaker 1: Index up by one and a half percent. Eurostocks fifty

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Speaker 1: features are six tents higher this morning. The tenure treasury

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Speaker 1: yield up three and a half basis points now to

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Speaker 1: four point zero four percent. Gold prices are sliding seven

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Speaker 1: tents this morning four eighty three dollars a barrel. Copper

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Speaker 1: futures though by one point eight percent, and oil prices

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Speaker 1: have been rising as well on the back of those

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Speaker 1: latest US China headlines. Just looking at the latest that

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Speaker 1: we're hearing from the US President talking about he's going

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Speaker 1: to have a great talk with she saying he thinks

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Speaker 1: they'll have a successful transaction with the Chinese president and

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Speaker 1: we might sign a final deal on TikTok on Thursday.

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Speaker 1: Those are some of the latest comments we've had out

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Speaker 1: of the US President. Now, in a moment, we'll bring

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Speaker 1: you up to date on the US China trade, plus

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Speaker 1: tell you how the recent spike in the price of

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Speaker 1: gold is also driving a hiring spree for traders in

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Speaker 1: the precious metal. But another story we've been reading this

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Speaker 1: morning about how housekeeper salaries in the US are now

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Speaker 1: topping one hundred thousand dollars as luxury furniture booms. So

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Speaker 1: James Army from Bloomberg Pursuits have been writing about this

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Speaker 1: and speaking to some of these top tier people and

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Speaker 1: what it takes to get to their level. One of

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Speaker 1: them Gina, telling him that you need to know at

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Speaker 1: art and design because some of the items that you're

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Speaker 1: cleaning could be irreplaceable. So she says the value of

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Speaker 1: the pieces has increased greatly, even if it's not the

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Speaker 1: most well known artists, and that high end houses have

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Speaker 1: crazy prices and almost everything, So it's not just the

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Speaker 1: complexity of the materials themselves. It could be mixes of

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Speaker 1: metals or woods or glass, or a variety of synthetics,

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Speaker 1: and she says she has to research everything before she

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Speaker 1: touches it as well. This is also meaning that some

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Speaker 1: of the specialist companies in this area are also finding

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Speaker 1: their services in high demand. James spoke to Charles McPherson

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Speaker 1: in Toronto, who trains in places staff in households around

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Speaker 1: the world. He offers a five week training course on

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Speaker 1: everything from communication to security. This, of course, of the

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Speaker 1: value of some of these precious furniture items have risen

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Speaker 1: as well, so the salaries of the people employed to maintain

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Speaker 1: them are going up to It's a great insight into

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Speaker 1: this industry. You can read the piece on Bloomberg dot

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Speaker 1: com and we'll put a link to it in our

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Speaker 1: poscast show notes as well.

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Speaker 4: Well.

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Speaker 1: Let's bring you some more now in those latest to

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Speaker 1: US China trade talks, after negotiators reached agreements on a

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Speaker 1: range of issues ahead of the meetings of President Trump

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Speaker 1: and She later this week. A little earlier, I spoke

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Speaker 1: to Bloomberg' Jenny marsh who leads our team covering China's

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Speaker 1: economy and government, and I started by asking her for

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Speaker 1: the details of what was agreed over the weekend. So

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Speaker 1: the details of.

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Speaker 7: The moment are very vague. What we do know is

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Speaker 7: that both sides they had these two days of talks

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Speaker 7: in Malaysia actually sort of much shorter in length and

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Speaker 7: mostne and other rounds, so they seem to have come

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Speaker 7: to the conclusions quite quickly. But they came out say

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Speaker 7: that they come to terms basically on a range of

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Speaker 7: contentious points, and so this covered export controls, fentanel, shipping levees,

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Speaker 7: and they also talked about sort of agricultural purgators as well,

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Speaker 7: and said that the final details of the TikTok deal

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Speaker 7: had also been sort of on the negotiating table, so

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Speaker 7: it was a very wide ranging sort of group of topics.

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Speaker 7: They didn't give as many sort of specifics other than

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Speaker 7: scot Percent did say after the talks rapped that the

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Speaker 7: Chinese said on their latest rare earth curbs, which have

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Speaker 7: been so controversial, they had pledged to defer those by

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Speaker 7: one year. So that's a fairly big concession there from

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Speaker 7: the Chinese, as revealed by the US side, We don't

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Speaker 7: have confirmation from Beijing.

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Speaker 1: How does this set us up then for the meeting

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Speaker 1: between Presidents Trump and She is the conciliatory tone being

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Speaker 1: matched on both sides.

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Speaker 7: It is it is. I think this sets us up

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Speaker 7: very well for the meeting between the two leaders. We

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Speaker 7: now sort of know what they're going to be talking about.

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Speaker 7: They're kind of just going to be signing off on

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Speaker 7: these areas, you know. And even the People's Daily, which

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Speaker 7: is the Communist Party's mouthpiece, had a commentary this morning

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Speaker 7: which was very dubbish in tone and really sort of

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Speaker 7: talking about how successful it is when the two sides

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Speaker 7: come together to use this sort of trade talks mechanism

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Speaker 7: they've set up, and calling on the US to sort

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Speaker 7: of jointly safeguard these hard won achievements and saying they

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Speaker 7: should be cherished. The context there, of course, is that

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Speaker 7: after previous roundst of trade talks, you know, they've both

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Speaker 7: gone back to their respective countries feeling like everything was

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Speaker 7: sorted out, and then the US Commerce Department has sort

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Speaker 7: of announced export controls and that's really angered the Chinese

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Speaker 7: over the last few months because that these sort of

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Speaker 7: extra controls have been outside the scope of these talks,

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Speaker 7: and what China really wants is for everything they are

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Speaker 7: talking about in terms of trade now to run through

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Speaker 7: this mechanism and to be able to manage it that

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Speaker 7: way so they're not caught by surprise by sort of

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Speaker 7: additional measures.

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Speaker 1: So where do we watch for the key air is

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Speaker 1: now that where further developments could happen as we count

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Speaker 1: down to that meeting. Are there subjects which could derail

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Speaker 1: the progress that has been made over the weekend?

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Speaker 7: I mean, never say never, right And you've got Trump,

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Speaker 7: percent and Marco Rubio all in the region right now

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Speaker 7: for Asian and APEC meetings, so they're all going to

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Speaker 7: be talking to the press and briefing, and I think,

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Speaker 7: you know, if any of them come out and say

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Speaker 7: anything particularly offensive towards the Chinese, that would be bad.

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Speaker 7: I think if if US Commerce Department this week, you know,

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Speaker 7: if Lutnick, Sydney and Washington decides to sort of Recabot

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Speaker 7: by rolling out some more sort of curves on Huawei

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Speaker 7: or something, that would be very very bad. That potentially

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Speaker 7: has even derailed the meeting between Trump and She. I

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Speaker 7: think at this point that isn't going to happen. And

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Speaker 7: everyone sort of worked very hard to get to where

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Speaker 7: they are now, and it looks like we're sort of

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Speaker 7: going to be reasonably smooth saling going into that meeting

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Speaker 7: on Thursday that Spinberks.

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Speaker 1: Jennie marshallely is our team covering China's economy and government.

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Speaker 1: Stay with us. More from Bloomberg Daybreak Europe coming up

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Speaker 1: after this. Now, trading houses, hedge funds, and banks are

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Speaker 1: on a hiring spree for specialist gold traders as interest

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Speaker 1: in the metal source. It's creating a battle for talents

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Speaker 1: that's driving up pay packages and what has traditionally been

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Speaker 1: a niche market our metals and mining reporters. Sobella grows

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Speaker 1: joins us now for more. It's great to talk to you.

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Speaker 1: Is this surgeon hiring them all down to the surge

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Speaker 1: in gold prices.

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Speaker 8: Partly, it's been an unprecedent year in gold and all

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Speaker 8: of the other precious metals really, and I've been speaking

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Speaker 8: to traders and they've been telling me they've been seeing

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Speaker 8: unprecedented demand from clients new clients have never really dealt

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Speaker 8: with before, including large corporations and multiple family offices. And

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Speaker 8: he said, just the level event one of the traders

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Speaker 8: I spoke with the other day, so it's just far

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Speaker 8: from normal. But on the other hand, what the trading

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Speaker 8: houses and hedge funds are really looking to exploit I

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Speaker 8: think in the current market is the fact that we've

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Speaker 8: seen huge priced dislocations on several occasions this year between

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Speaker 8: key trading hubs, which opens up very lucrative arbitrage opportunities. Obviously,

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Speaker 8: the beginning of the year, traders were very worried that

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Speaker 8: precious metals would be hit with US tariffs. Some of

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Speaker 8: those fears are still in the market for silver, platinum, palladium.

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Speaker 8: But basically what we're seeing is huge arbitrage opportunities open up,

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Speaker 8: and that's why all of these big physical trading houses

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Speaker 8: and the hedgephones want to come in and exploit those opportunities.

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Speaker 1: So how easy or difficult is it then to hire

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Speaker 1: gold traders?

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Speaker 8: I guess historically the market's been really dominated by a

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Speaker 8: small handful of banks. Probably the two most well known

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Speaker 8: ones are JP Morgan and HSBC. I think in previous years.

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Speaker 8: You know, I've been talking to traders who've been in

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Speaker 8: the market a long time, and they've kind of expressed

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Speaker 8: sort of sentiments along the lines of banks have sort

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Speaker 8: of stepped away from the market underinvested in their team,

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Speaker 8: so effectively, what we're looking at today is a lot

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Speaker 8: of these banks have been operating with quite lean teams

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Speaker 8: and that's left us with a not very deep pool

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Speaker 8: of talent. Now that prices have saw this year, as

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Speaker 8: you rightly pointed out at the beginning, you know, new

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Speaker 8: participates want to take opportunities to break into the sector,

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Speaker 8: but there aren't that many people to draw upon. So

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Speaker 8: to give you a sense of how much the backup

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Speaker 8: really has changed, my colleague Jack Ryan wrote in a

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Speaker 8: story earlier this month, you know, an average of nearly

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Speaker 8: six hundred billion dollars worth of spot gold has been

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Speaker 8: traded each week in London in recent months. That's more

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Speaker 8: than a threefold increase since twenty twenty one. The other

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Speaker 8: point I would just make is, you know what the

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Speaker 8: physical trading houses and hedge funds really want people who

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Speaker 8: understand the macro force, its forces that really steer what's

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Speaker 8: happening in precious metals prices, but also just the practicalities

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Speaker 8: of moving the metal around, because that's really where the

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Speaker 8: probably the biggest opportunity is, like exploiting those charge windows.

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Speaker 1: So for those people who are already in this area

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Speaker 1: and skilled, are they rubbing their hands with glee? What

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Speaker 1: does it mean in terms of the sort of incentives

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Speaker 1: that they can attract in this area.

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Speaker 8: Yeah, that's a great question. A lot of the traders

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Speaker 8: I've spoken to have been saying, you know, they're being

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Speaker 8: hit up on a weekly or you know, monthly basis,

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Speaker 8: even from other participants in the market who are keen

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Speaker 8: to poach them. So I guess, you know, the world's

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Speaker 8: their oyster. They've they've got a lot of opportunities. I

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Speaker 8: guess the most obvious incentive here is, you know, bonuses.

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Speaker 8: Trading houses and hedgepunts are more willing to pay more.

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Speaker 8: One of my colleagues spoke with a commodities hedge headhunter,

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Speaker 8: and you know he mentioned that basically physical trading houses

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Speaker 8: can get bonuses that are two to three higher times

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Speaker 8: higher than banks. So you're seeing a huge amount of

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Speaker 8: turnover at all sorts of levels, and I guess traders

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Speaker 8: can move around if they don't feel like they're being

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Speaker 8: properly incentivized.

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