WEBVTT - Bloomberg Daybreak Weekend: Apple, Sunak, Japan 0:00:02.120 --> 0:00:04.480 This is Bloomberg day Break Weekend, our global look at 0:00:04.480 --> 0:00:07.000 the top stories in the coming week from our Daybreak 0:00:07.000 --> 0:00:09.960 anchors all around the world, and straight ahead on the program, 0:00:10.000 --> 0:00:14.400 tech stocks and focus again because of Apple's Worldwide Developers Conference. 0:00:14.640 --> 0:00:16.319 I'm Tom Busby in New York. 0:00:16.400 --> 0:00:18.840 I'm Caroline Hepkee here in London, where we're looking ahead 0:00:18.840 --> 0:00:22.079 to Rishisu Nak's first White House visit as Prime Minister. 0:00:22.239 --> 0:00:26.000 I'm Brian Curtis in Hong Kong. Capex is jumping in Japan. 0:00:26.120 --> 0:00:29.200 The tourists are coming in, but all is not well. 0:00:29.320 --> 0:00:31.600 I'm Kaylee Lyons in Washington, where we're gearing up for 0:00:31.640 --> 0:00:34.199 two new entrants in the race for the Republican nomination 0:00:34.360 --> 0:00:35.280 in twenty twenty four. 0:00:35.479 --> 0:00:38.720 That's all straight ahead on Bloomberg day Break Weekend on 0:00:38.880 --> 0:00:41.720 Bloomberg E Love the three own New York, Bloomberg ninety 0:00:41.800 --> 0:00:45.400 nine to one, Washington, DC, Bloomberg one O six one, Boston, 0:00:45.440 --> 0:00:50.240 Bloomberg nine sixty, San Francisco, DAB Digital Radio, London, Sirius 0:00:50.400 --> 0:00:53.640 XM one nineteen and around the world on Bloomberg Radio 0:00:53.720 --> 0:00:56.040 dot com and via the Bloomberg Business App. 0:01:00.040 --> 0:01:01.840 Good day to you. I'm Tom Busby, and we begin 0:01:01.920 --> 0:01:06.520 today's program with Apple's upcoming Worldwide Developers Conference at it's 0:01:06.560 --> 0:01:09.840 Cooper Tino, California headquarters. And this one could be a 0:01:10.040 --> 0:01:14.240 very important one for Apple executives and Apple investors. And 0:01:14.319 --> 0:01:17.399 joining me to talk about why is Bloomberg's Mark German 0:01:17.480 --> 0:01:21.760 our report around all things Apple. Mark, Thanks for joining us, Thanks. 0:01:21.480 --> 0:01:23.679 For having me. Yeah, this is certainly probably going to 0:01:23.680 --> 0:01:27.560 be Apple's biggest launch event in the last decade, certainly 0:01:27.600 --> 0:01:30.759 since the Apple Watch was announced in twenty fourteen. This 0:01:30.800 --> 0:01:35.480 is their annual developer conference, typically software focused, this time 0:01:35.760 --> 0:01:39.200 first major new products in a decade, major software updates 0:01:39.200 --> 0:01:42.520 across the board, as well as new max Well. 0:01:42.360 --> 0:01:45.120 It's a laundry list of new things, but let's start 0:01:45.160 --> 0:01:47.640 with what I think will garner the biggest headlines. That 0:01:47.760 --> 0:01:52.840 mixed reality headset, the first major new product category since 0:01:52.840 --> 0:01:54.320 the Watch right almost a decade. 0:01:54.760 --> 0:01:57.880 Right, that's certainly going to be the entree, so to speak, 0:01:57.960 --> 0:02:00.720 of the launch and the focus of Apple for the 0:02:00.760 --> 0:02:05.080 foreseeable future. This is Apple trying to create an XR 0:02:05.200 --> 0:02:07.840 or a mixed reality market. The device is going to 0:02:07.880 --> 0:02:12.240 be the most premium, high end and powerful headset on 0:02:12.280 --> 0:02:15.240 the market. It's going to cost roughly three thousand dollars. 0:02:15.240 --> 0:02:17.239 Apple is not going to be profiting off this thing. 0:02:17.880 --> 0:02:20.480 That's how expensive the technologies that go into it are. 0:02:20.720 --> 0:02:24.480 It's going to use metal, carbon, fiber, and glass. You're 0:02:24.520 --> 0:02:26.440 going to be able to do everything you would do 0:02:26.520 --> 0:02:29.080 in a Mac but in a virtual three D space. 0:02:29.600 --> 0:02:31.560 You're going to be able to move in between a 0:02:31.639 --> 0:02:35.240 virtual reality world in an augmented reality world, which means 0:02:35.639 --> 0:02:38.040 at one point you could be fully enclosed you see 0:02:38.040 --> 0:02:41.600 nothing but the content in front of you. At other points, 0:02:41.600 --> 0:02:44.080 you'll flick a dial on the top right of the headset, 0:02:44.080 --> 0:02:46.040 similar to the dial on the side of the Apple Watch. 0:02:46.440 --> 0:02:49.120 It'll turn on these powerful cameras. There's about a dozen 0:02:49.120 --> 0:02:51.959 of them outside, and you'll essentially see what's in front 0:02:51.960 --> 0:02:54.120 of you, just like you're wearing normal glasses or wearing 0:02:54.160 --> 0:02:59.040 nothing on your face. You'll be able to do productivity, messaging, gaming, 0:02:59.320 --> 0:03:02.679 a virtual reac version of FaceTime. So it's going to 0:03:02.720 --> 0:03:05.480 be pretty wide ranging, and this is Apple's big entry 0:03:05.480 --> 0:03:06.120 into the space. 0:03:07.080 --> 0:03:10.760 Now, a sidebar before we continue on Apple is just 0:03:10.840 --> 0:03:14.680 this past week Meta announcing a five hundred dollars mixed 0:03:14.720 --> 0:03:18.359 reality headset. So trying to take some thunder away from. 0:03:18.200 --> 0:03:19.840 Apple, do you think certainly? 0:03:19.919 --> 0:03:23.160 I've used the Quest three, and at five hundred dollars, 0:03:23.160 --> 0:03:24.799 it's going to be about a fifth at the price 0:03:24.800 --> 0:03:27.840 of Apple's product, but I think it's more than a 0:03:27.840 --> 0:03:31.000 fifth as good. I think it's quite impressive. The video 0:03:31.120 --> 0:03:33.920 pass through mode they're going to be using on this device. 0:03:33.919 --> 0:03:35.560 It's not going to be as good as Apples, but 0:03:35.600 --> 0:03:38.520 it's much better than the existing Meta headset, the Quest 0:03:38.520 --> 0:03:40.640 two in the market that launched a couple of years ago. 0:03:40.960 --> 0:03:43.880 So I certainly think what you're seeing here is a 0:03:44.000 --> 0:03:48.920 potential rematch between Apple and another player instead of Google. 0:03:48.960 --> 0:03:51.680 This time it's Meta in terms of Apple wanting to 0:03:51.680 --> 0:03:53.960 own the high end of the market and Meta owning 0:03:53.960 --> 0:03:55.680 the loan in the market, just like Apple owns high 0:03:55.760 --> 0:03:58.240 end of the phone market and Google owns the low end. 0:03:58.400 --> 0:04:00.720 Apple and the high end of the XR market Metal 0:04:00.880 --> 0:04:03.360 on the low end, and so Meta's really replaced Google 0:04:03.360 --> 0:04:05.480 as the one at the frontier here. 0:04:05.800 --> 0:04:08.880 Yeah, and when worlds collide, Well, let's go back to 0:04:08.920 --> 0:04:12.280 some of the other exciting new products and updates that 0:04:12.320 --> 0:04:14.680 Apple we think Apple is going to have, And let's 0:04:14.680 --> 0:04:17.720 start with the new XROS operating system, so. 0:04:17.640 --> 0:04:21.880 That XROS operating system is a version of iOS that 0:04:22.440 --> 0:04:24.719 is going to run on this mixed reality headset. So 0:04:24.720 --> 0:04:27.200 they've created a whole new operating system. They're pushing for 0:04:27.240 --> 0:04:29.840 a whole new app store and an app ecosystem to 0:04:29.920 --> 0:04:30.760 run on the setset. 0:04:31.600 --> 0:04:35.200 And continuing on operating systems, there's a new iOS seventeen, 0:04:35.440 --> 0:04:39.120 an iPad OS seventeen, and a macOS fourteen. 0:04:39.320 --> 0:04:41.480 So macOS fourteen that's going to be the new software 0:04:41.520 --> 0:04:43.880 update that runs on the Mac. Right not expecting major 0:04:43.960 --> 0:04:47.680 changes there. iPad OS seventeen you'll see some minor improvements 0:04:47.720 --> 0:04:50.800 the multitasking. You'll also see the health app on the 0:04:50.839 --> 0:04:54.159 iPad for the first time. iOS seventeen you'll see a 0:04:54.160 --> 0:04:58.000 new journaling app so you can journal different locations you're 0:04:58.000 --> 0:05:00.480 at or different activities are doing and share it with friends. 0:05:00.880 --> 0:05:04.520 There'll be updates to the wallet app on the device 0:05:04.560 --> 0:05:07.240 as well, in a new smart home feature that can 0:05:07.279 --> 0:05:09.360 turn the iPhone if you rotate it and put it 0:05:09.400 --> 0:05:12.680 in lock mode, into a smart home display so to speak. 0:05:12.720 --> 0:05:15.280 So quite a few little enhancements across the board on 0:05:15.320 --> 0:05:17.239 the iPhone and the iPad and the Mac as well, 0:05:17.760 --> 0:05:20.320 and then you'll also see Watch OS ten that's going 0:05:20.400 --> 0:05:22.599 to be a pretty big update to the Apple Watch software, 0:05:22.800 --> 0:05:25.400 will bring widgets to the forefront of the operating system. 0:05:25.600 --> 0:05:27.920 I think that will be pretty interesting to consumers as well. 0:05:28.600 --> 0:05:31.400 And as for hardware, not just the mixed reality headset, 0:05:31.400 --> 0:05:33.719 but also new MacBooks. 0:05:33.240 --> 0:05:36.360 There's going to be multiple new Macs. I'm expecting a 0:05:36.480 --> 0:05:39.080 new version of the MacBook Air, a fifteen inch MacBook 0:05:39.080 --> 0:05:42.560 Air with an M two chip, so it'll operate similarly 0:05:42.600 --> 0:05:46.400 and look the same as the thirteen inch Air introduced 0:05:46.560 --> 0:05:50.120 last year at WWDC, but obviously it'll be bigger with 0:05:50.200 --> 0:05:52.479 that bigger fifteen inch panel. That's something that people have 0:05:52.480 --> 0:05:55.679 been clamoring for for over a decade, and so Apple 0:05:55.760 --> 0:05:57.960 is going to be delivering there. They'll also see the 0:05:57.960 --> 0:06:01.279 company's first M two Ultra chip. That's an extremely high 0:06:01.400 --> 0:06:04.839 end chip with up to seventy six graphics scores, essentially 0:06:05.200 --> 0:06:08.000 ten x what you're getting on a low end Mac 0:06:08.120 --> 0:06:11.000 right a low in MacBook Air, and that machine will 0:06:11.040 --> 0:06:14.960 be its highest performing chip for machines like the Mac 0:06:15.040 --> 0:06:18.719 Studio and potentially the Mac Pro. So really something for 0:06:18.800 --> 0:06:20.520 everyone across the board at this launch. 0:06:20.920 --> 0:06:21.839 Wow. Wow. 0:06:22.160 --> 0:06:27.920 Now, and preceding this week's upcoming conference, last week, Apple 0:06:28.080 --> 0:06:32.160 announced the plans for its retail stores and a big expansion. 0:06:32.480 --> 0:06:33.680 What did you tell us more about that? 0:06:34.400 --> 0:06:38.800 Yes, so Apple actually didn't announce these stores. We're reporting 0:06:38.800 --> 0:06:42.840 on these stores based on my insight sources. Apple is 0:06:43.040 --> 0:06:46.320 proposing or working on or developing over fifty new stores 0:06:46.640 --> 0:06:50.000 for opening across the next four years, including new stores 0:06:50.000 --> 0:06:54.480 in China, India, stores in Detroit and Miami, new store 0:06:54.520 --> 0:06:58.280 in southern California and Orange County, and upgrade to its 0:06:58.360 --> 0:07:01.760 Opera store in Paris that's a very famous shopping district. 0:07:02.480 --> 0:07:06.480 New stores in Canada, across Europe, a new store in 0:07:06.520 --> 0:07:09.880 Abu Dhabi, a relocated store in Perth, Australia. So really 0:07:10.120 --> 0:07:13.000 an across the board expansion on the retail segment. 0:07:13.720 --> 0:07:14.960 Got it? Got it? Wow? 0:07:15.560 --> 0:07:17.520 Now let's talk a little bit. Let's shift gears talk 0:07:17.560 --> 0:07:21.800 about artificial intelligence chat GPT, the latest technological tool for 0:07:21.960 --> 0:07:25.840 so many companies, so many consumers. AI getting Wall Street 0:07:25.840 --> 0:07:29.040 excited too, and Apple CEO Tim Cook says it has 0:07:29.080 --> 0:07:33.480 its risks, but Apple is all in on artificial intelligence. 0:07:33.560 --> 0:07:34.320 Let's go a listen. 0:07:34.560 --> 0:07:38.160 I do think it's very important to be delivered and 0:07:38.200 --> 0:07:43.120 thoughtful in how you approach these things. And there's a 0:07:43.200 --> 0:07:46.280 number of issues that need to be sorted, as is 0:07:46.320 --> 0:07:49.480 being talked about in a number of different places. But 0:07:49.600 --> 0:07:55.840 the potential is certainly very interesting. And we've obviously made 0:07:55.960 --> 0:08:01.240 enormous progress integrating AI and machine learning throughout our ecosystem, 0:08:01.720 --> 0:08:05.840 and we've weaved it into products and features for many years. 0:08:06.520 --> 0:08:06.840 Well. 0:08:06.920 --> 0:08:09.240 Based on what we heard Tim Cook say last week, 0:08:09.320 --> 0:08:11.760 how does AI fit into Apple's future? 0:08:11.760 --> 0:08:12.000 Mark? 0:08:12.080 --> 0:08:14.480 You know, I think AI or applied AI as a 0:08:14.560 --> 0:08:17.320 call it is very key to the company's future. I 0:08:17.320 --> 0:08:20.360 think this is certainly something that they're trying to implement 0:08:20.400 --> 0:08:23.400 across their product lines, from taking a picture to using 0:08:23.640 --> 0:08:26.800 handwa washed detection on the watch, to using some of 0:08:26.800 --> 0:08:29.240 the health features on the iPhone and the iPad. Right, 0:08:29.560 --> 0:08:33.680 But I don't think that we're to expect a major 0:08:33.840 --> 0:08:37.199 chat GPT like product from Apple or an overhaul of 0:08:37.320 --> 0:08:39.640 Siri this year. I think that's something that's probably going 0:08:39.720 --> 0:08:41.560 to come next year or the year after at the earliest. 0:08:42.600 --> 0:08:46.280 Now, all the things we talked about today that looking 0:08:46.320 --> 0:08:50.240 forward to this coming week, let's talk about Apple's big 0:08:50.280 --> 0:08:54.160 money maker, the iPhone, and what does all this mean 0:08:54.679 --> 0:08:58.120 for the iPhone? Is it you know? Is it moving 0:08:58.160 --> 0:09:01.960 it forward? Are we expecting more from the iPhone this 0:09:02.080 --> 0:09:02.880 year or soon? 0:09:03.800 --> 0:09:05.800 So there'll be a pretty big iPhone hardware update in 0:09:05.840 --> 0:09:10.079 the fall. That's the iPhone fifteen line one. Big change there. 0:09:10.280 --> 0:09:12.880 On the pro models, they're going to be moving from 0:09:13.200 --> 0:09:19.600 a stainless steel and glass frame to more of a 0:09:19.720 --> 0:09:23.160 titanium frame, which I think is going to be quite interesting, 0:09:23.480 --> 0:09:26.120 make the phone a little bit more durable, potentially make 0:09:26.160 --> 0:09:28.480 it lighter as well, and so I think that new 0:09:28.520 --> 0:09:30.640 design is something people are going to be looking forward to. 0:09:31.400 --> 0:09:33.800 On the highest end model with the biggest screen, you're 0:09:33.840 --> 0:09:36.000 going to have what is known as a periscope camera. 0:09:36.520 --> 0:09:38.560 What that is going to do is allow the camera 0:09:38.679 --> 0:09:43.080 to have a wider range of zoom, but optical zoom, 0:09:43.080 --> 0:09:46.360 which means that the camera itself, the scope is actually 0:09:46.400 --> 0:09:49.280 longer and twisted in the frame, and that actually can 0:09:49.320 --> 0:09:52.040 get a much more detailed picture than the digital zoom 0:09:52.280 --> 0:09:54.760 that the iPhone on other phones today really rely on 0:09:54.800 --> 0:09:58.000 for that wide range of zoom. So big change is there. 0:09:58.280 --> 0:10:00.680 And then on the lower end iPhones, they're going to 0:10:00.720 --> 0:10:03.480 add the dynamic island, which is that new pill shape 0:10:03.480 --> 0:10:06.360 at the top where you can control some of your alerts, identifications, 0:10:06.400 --> 0:10:08.600 and your music and maps. On the high end iPhones today, 0:10:09.120 --> 0:10:11.240 that'll be coming down the line, as well as some 0:10:11.280 --> 0:10:13.240 of the camera upgrades that you saw on the high 0:10:13.280 --> 0:10:16.200 end iPhones last year coming down the range as well. 0:10:16.679 --> 0:10:19.760 And also on the high end phones, you'll see a 0:10:19.800 --> 0:10:23.640 faster processor that'll be like the A seventeen processor, whereas 0:10:23.800 --> 0:10:27.400 the lower niphones will get last year's pro processor. So 0:10:27.520 --> 0:10:29.080 that's going to be a year of a year upgrade 0:10:29.080 --> 0:10:29.440 as well. 0:10:30.000 --> 0:10:30.160 Well. 0:10:30.200 --> 0:10:32.640 There is a lot to look forward to this week 0:10:32.720 --> 0:10:35.240 and in the near future. And thank you Mark. That 0:10:35.360 --> 0:10:38.760 was Bloomberg's Apple reporter Mark German. And coming up on 0:10:38.760 --> 0:10:42.920 Bloomberg day Break weekend, British Prime Minister Rishi Sunak's big visit. 0:10:43.000 --> 0:10:43.720 To the US. 0:10:44.280 --> 0:10:57.720 I'm Tom buzby you and this is Bloomberg. This is 0:10:57.720 --> 0:11:00.720 Bloomberg day Break weekend, our globalk ahead of the top 0:11:00.760 --> 0:11:04.040 stories for investors in the coming week. I'm Tom Busby 0:11:04.120 --> 0:11:06.920 in New York. Up later in our program, a growing 0:11:07.000 --> 0:11:12.520 number of Republicans challenging former President Trump's reelection efforts. But first, 0:11:12.520 --> 0:11:15.520 the British Prime Minister gets his first White House meeting 0:11:15.559 --> 0:11:17.960 with President Biden in the coming week, and for more, 0:11:18.440 --> 0:11:20.959 let's head to London and bring in Bloomberg Daybreak europe 0:11:21.000 --> 0:11:23.520 Banker Caroline Hepger Tom Rischie. 0:11:23.520 --> 0:11:27.680 Sunak will travel to Washington for talks aimed at enhancing 0:11:27.800 --> 0:11:30.880 cooperation and coordination between the UK and US on the 0:11:30.960 --> 0:11:35.040 economic challenges that will define our future, so we're told, 0:11:35.400 --> 0:11:38.560 and Bloomberg's UK Government editor Alex Morales will be on 0:11:38.600 --> 0:11:39.920 the plane with the PM. 0:11:39.960 --> 0:11:42.280 He joins me. Now, so Sunak's. 0:11:41.840 --> 0:11:44.160 Visit to the States, I mean it's not going to 0:11:44.440 --> 0:11:50.560 deliver this long touted, hope for but unlikely trade deal 0:11:50.640 --> 0:11:52.000 between the UK and US. 0:11:54.000 --> 0:11:57.920 Well in a short answer, No, I mean, first of all, 0:11:57.920 --> 0:11:59.520 it's important to say it's his first visit to the 0:11:59.559 --> 0:12:02.160 White House as Prime Minister. I mean he's met Joe 0:12:02.200 --> 0:12:05.520 Biden a number of times already. I think the first 0:12:05.600 --> 0:12:09.440 time was back in Bali at the G twenty, but 0:12:09.520 --> 0:12:12.920 he also met in San Diego earlier in this year 0:12:12.960 --> 0:12:16.400 for the Big Orchest deal, and then more recently in 0:12:16.440 --> 0:12:19.160 Northern Ireland. And I guess they would have also spoken 0:12:19.160 --> 0:12:23.319 at Hiroshima, but there was no official Bilab that's the 0:12:23.400 --> 0:12:28.440 g Sevon meeting in May. But yes, he's visiting to 0:12:28.440 --> 0:12:32.079 the White House. Number ten have been pretty clear they're 0:12:32.120 --> 0:12:36.200 not going to bring up the topic of a trade deal, 0:12:37.600 --> 0:12:40.240 and that's largely because the Biden administration has really made 0:12:40.240 --> 0:12:43.200 it pretty clear that it's not a priority for them. No. 0:12:43.480 --> 0:12:47.080 Indeed, I mean the UK has tried to secure these 0:12:47.280 --> 0:12:50.800 deals with individual states which have you know, sort of 0:12:50.880 --> 0:12:53.360 tried to ramp up ties between the UK and the 0:12:53.480 --> 0:12:56.800 US on that basis. I mean, it's interesting, isn't it 0:12:56.840 --> 0:12:58.599 that this will be the first White House visit And 0:12:59.040 --> 0:13:01.000 you mentioned north in Ireland. I mean, that was the 0:13:01.080 --> 0:13:06.480 last time that we saw President Biden here. He was 0:13:06.520 --> 0:13:09.800 in northern Ireland and in the Republic of Ireland. Is 0:13:09.840 --> 0:13:13.160 there still friction do you think on that issue? 0:13:14.440 --> 0:13:17.320 Well, the White House pushed back against the notion that 0:13:17.360 --> 0:13:22.120 Biden doesn't really like Britain. But what was fairly clear 0:13:22.320 --> 0:13:25.360 from his visit is that when it comes to there's 0:13:25.360 --> 0:13:29.200 a lot of warmth towards Ireland and much less warmth 0:13:29.720 --> 0:13:33.760 towards the United Kingdom from the President. And that even 0:13:33.800 --> 0:13:38.400 became clearer when he returned and he gave a briefing 0:13:38.600 --> 0:13:41.440 and it sort of surfaced in the transcript. He'd said 0:13:41.480 --> 0:13:43.120 he'd had to come over here to make sure the 0:13:43.160 --> 0:13:47.600 Brits didn't screw around in Northern Ireland. So really, you know, 0:13:47.640 --> 0:13:49.560 he likes to pick up his Irish heritage, and he 0:13:49.640 --> 0:13:52.959 tried to flick a bit at his British heritage when 0:13:53.000 --> 0:13:55.120 he was in Northern Ireland, and he had some English 0:13:55.160 --> 0:13:58.320 heritage as well that he sort of emphasized, and that 0:13:58.360 --> 0:14:02.240 was sort of a bone to the Brits who think 0:14:02.320 --> 0:14:06.920 that maybe he doesn't quite like us very much. But yeah, 0:14:07.120 --> 0:14:08.640 there seems to be a little bit of friction. 0:14:09.600 --> 0:14:13.760 Okay, So that kind of point perhaps still of some contention. 0:14:14.559 --> 0:14:18.800 How does the UK then respond to the Inflation Reduction Act? 0:14:18.840 --> 0:14:20.600 Do you think that that is something that is going 0:14:20.640 --> 0:14:22.920 to come up in these talks that are going to 0:14:22.920 --> 0:14:26.200 be about kind of economics and about policy and about 0:14:27.040 --> 0:14:30.200 you know, the relationship between the US and the UK. 0:14:30.360 --> 0:14:33.240 The Inflation Reduction Act is simply huge in terms of 0:14:33.280 --> 0:14:37.320 the subsidies that gives businesses to move, you know, towards 0:14:37.360 --> 0:14:41.280 that energy and green transition. What do you think Sunac's 0:14:41.280 --> 0:14:42.480 message is going to be on that? 0:14:44.040 --> 0:14:46.760 Well, I'm sure so what wants to make sure that 0:14:46.800 --> 0:14:48.720 I mean, as you said, it's a huge package, is 0:14:48.720 --> 0:14:52.440 what three hundred and sixty nine billion dollars of subsidies 0:14:52.440 --> 0:14:55.200 and tax breaks and just to sort of wind back. 0:14:55.240 --> 0:14:59.840 The big concern amongst British companies is that it's just 0:15:00.080 --> 0:15:03.640 it attracts investment to the United States that would otherwise 0:15:03.680 --> 0:15:07.360 have gone to Britain. So you know there's been some 0:15:07.400 --> 0:15:10.960 concern amongst ministers. When he was Business actually back in January, 0:15:11.080 --> 0:15:16.280 Grant Shapps called it dangerous and Jeremy Hunt has said 0:15:16.280 --> 0:15:19.640 that while he doesn't who's the chancellor obviously has said 0:15:19.640 --> 0:15:24.160 that while he doesn't want to a subsidy race, he's 0:15:24.160 --> 0:15:26.160 sort of hinted in recent weeks that the UK is 0:15:26.160 --> 0:15:29.920 actually looking at some sort of subsidy response. I think 0:15:30.360 --> 0:15:33.280 his exact words with subsidies have a role and that 0:15:33.320 --> 0:15:36.080 Britain will make sure that we remain competitive. And he's 0:15:36.080 --> 0:15:39.280 promised the UK response to both the US measures and 0:15:39.400 --> 0:15:42.240 let's not forget that the EU launched a package of 0:15:42.280 --> 0:15:47.920 messages sort of to counter the US effect. He's promised 0:15:48.840 --> 0:15:52.000 a response by the full because obviously the danger is 0:15:52.040 --> 0:15:54.120 that the UK ends up getting squeezed between these two 0:15:54.120 --> 0:15:56.680 big powers and losing out on investment in both directions. 0:15:58.440 --> 0:16:04.320 Yeah, on the foreign policy points, then Ukraine, Russia, China, 0:16:04.400 --> 0:16:07.520 and the UK has been close to the US in 0:16:08.160 --> 0:16:11.360 the support for Ukraine in terms of, you know, giving 0:16:11.440 --> 0:16:16.040 weapons to Vladimir Zelenski. How do you think that the 0:16:16.120 --> 0:16:19.600 discussions will be handled in terms of moving forwards when 0:16:19.600 --> 0:16:22.320 it comes to the war in Europe? But also the 0:16:22.440 --> 0:16:26.880 US is rhetoric increasingly tough rhetoric and actions against China. 0:16:28.720 --> 0:16:32.400 Well. On Ukraine, I mean, it's almost arguable that the 0:16:32.520 --> 0:16:34.520 UK has been ahead of the US and we were 0:16:34.520 --> 0:16:38.200 the first country to provide main battle tanks to Ukraine, 0:16:38.840 --> 0:16:41.360 and I think when now the country that's provided the 0:16:41.400 --> 0:16:43.360 longest range missiles. 0:16:44.280 --> 0:16:45.400 To the US. 0:16:45.520 --> 0:16:48.040 But I think largely the two countries are in lockstep 0:16:48.080 --> 0:16:52.720 on that, and certainly Biden's been very supportive of Ukraine 0:16:53.400 --> 0:16:56.720 in a way that perhaps this publican predecessor might not 0:16:56.840 --> 0:17:01.160 have been. And on China again, I think I think 0:17:01.440 --> 0:17:03.800 there's a sort of similarity in the language. Both both 0:17:03.840 --> 0:17:08.800 countries are wary that China is a very important economic 0:17:08.840 --> 0:17:12.360 character and that they need to maintain an economic relationship 0:17:12.400 --> 0:17:17.040 with China, but they're also wary of China's growing sort 0:17:17.040 --> 0:17:23.040 of nationalism and the danger it poses in the Indo Pacific, 0:17:23.680 --> 0:17:27.119 and perhaps the visit that Sunak made to the US 0:17:27.880 --> 0:17:32.800 earlier this year to San Diego, where the US, the 0:17:32.920 --> 0:17:37.040 UK and Australia sort of fleshed out the details behind 0:17:37.080 --> 0:17:40.040 their orchest packs. That's that's an indication of how seriously 0:17:40.080 --> 0:17:43.000 they hit the China threat. It's sort of a big, 0:17:43.520 --> 0:17:46.000 multi billion dollar plan for a new feat feet of 0:17:46.200 --> 0:17:50.719 nuclear powered submarines to patrol that that region. 0:17:51.720 --> 0:17:54.600 Yeah, absolutely, and the White House has pointed to this 0:17:55.040 --> 0:17:58.080 as an area for discussion, you know, reviewing a range 0:17:58.080 --> 0:18:00.520 of global issues, is how they put it. 0:18:01.520 --> 0:18:02.600 I wonder whether. 0:18:02.359 --> 0:18:07.000 There are areas for photo ops but also slip ups. 0:18:07.119 --> 0:18:11.320 That's always something that we are kind of keenly aware of. 0:18:11.400 --> 0:18:13.840 I mean, it is a big, big moment, isn't it. 0:18:13.920 --> 0:18:16.720 He's gonna arrive on the seventh of June, then he'll 0:18:16.760 --> 0:18:18.520 be in the White House the following day, and then 0:18:18.520 --> 0:18:20.840 he's meant to also be meeting congressional leaders. 0:18:21.000 --> 0:18:23.280 You're going to be on the plane with him. 0:18:23.400 --> 0:18:25.000 Do you think there'll be a chance to ask him 0:18:25.040 --> 0:18:29.000 some questions, to pose some questions to Rishie Sunak. Are 0:18:29.040 --> 0:18:33.240 there any kind of he's under pressure politically at home? Surely, 0:18:33.280 --> 0:18:35.560 isn't he on quite a number of fronts? 0:18:36.720 --> 0:18:38.399 Yeah, I mean certainly. I mean what we don't know 0:18:38.440 --> 0:18:39.800 is if there's going to be a press converty yet. 0:18:39.800 --> 0:18:42.320 But on the plane the Prime Minister will normally come 0:18:42.320 --> 0:18:45.840 back and speaking what's called a huddle. I think the 0:18:45.880 --> 0:18:51.400 photos and our legendary, so you know, each reporter will 0:18:51.400 --> 0:18:55.200 get probably one question to the Prime Minister and then 0:18:56.680 --> 0:18:58.400 you know we'll ask him about a range of issues 0:18:58.440 --> 0:19:00.199 and it won't just be about the US visit. So 0:19:00.640 --> 0:19:02.719 I guess there's the chance that he says something on 0:19:02.760 --> 0:19:07.320 the plane referring to its domestic issues that you know 0:19:07.400 --> 0:19:11.480 that are that are preoccupying the British media at the moment. 0:19:12.560 --> 0:19:15.520 In terms of in terms of potential for embarrassment, I mean, 0:19:15.720 --> 0:19:21.880 Richie sec is a pretty assured operator. It's it would 0:19:21.880 --> 0:19:25.960 be unusual for him to misspeak. But you know, on 0:19:26.160 --> 0:19:28.600 on on any international trip, there's the potential for something. 0:19:28.400 --> 0:19:31.960 To get wrong, yeah, or something to peque our interests. 0:19:32.000 --> 0:19:34.480 I know you'll be there with your question for the PM. 0:19:35.000 --> 0:19:37.679 Uh and Alex thank you so much for being with us. 0:19:37.720 --> 0:19:41.400 Bloomberg's UK Government editor Alex Morales, of course, who will 0:19:41.400 --> 0:19:44.600 be in Washington, DC and following the movements of the 0:19:44.640 --> 0:19:48.200 British Prime Minister Richie Sunac on his visit at State Side. 0:19:48.200 --> 0:19:50.199 I'm Caroline Hepgar here in London. You can catch us 0:19:50.200 --> 0:19:52.560 every weekday morning here for Bloomberg Daybreak you're at beginning 0:19:52.560 --> 0:19:53.600 at six am in London. 0:19:53.760 --> 0:19:55.120 That's one am on Wall Street. 0:19:55.240 --> 0:19:58.359 Tom beg you, Caroline. That was Bloomberg Daybreak Europe Post 0:19:58.600 --> 0:20:01.840 Caroline Hepgar and coming up on Bloomberg day Break weekend, 0:20:02.240 --> 0:20:06.120 we talk about Japan's economic recovery and preview this week's 0:20:06.520 --> 0:20:10.919 GDP report. I'm Tom Busby and this is Bloomberg. 0:20:10.720 --> 0:20:24.880 Broadcasting live from the Bloomberg it a active Brokers studio 0:20:25.000 --> 0:20:28.200 in New York. Bloomberg elemon three oh to Washington, d C, 0:20:28.320 --> 0:20:31.720 Bloomberg ninety nine one to Boston, Bloomberg one oh six 0:20:31.840 --> 0:20:35.119 one to San Francisco, Bloomberg nine sixteen to the country, 0:20:35.200 --> 0:20:39.080 Sirius XM channel one to nineteen to London DAB Digital 0:20:39.200 --> 0:20:42.119 Radio and around the globe the Bloomberg Business app in 0:20:42.200 --> 0:20:46.320 Bloomberg Radio dot Com. This is Bloomberg Daybreak weekend. 0:20:52.480 --> 0:20:54.600 I'm Tom Busby in New York with your global look 0:20:54.600 --> 0:20:57.560 ahead at the top stories for investors in the coming week. 0:20:57.840 --> 0:21:00.320 And this week we get some important economic data coming 0:21:00.359 --> 0:21:04.080 out of Japan, including the latest GDP report. For more, 0:21:04.160 --> 0:21:06.359 let's go to Hong Kong and Bloomberg day Break Asia 0:21:06.400 --> 0:21:07.760 host Brian Curtis. 0:21:08.000 --> 0:21:10.000 Tom, we look at some of the cross currents in 0:21:10.040 --> 0:21:12.880 the Japanese economy as we look forward to the next 0:21:12.880 --> 0:21:16.359 reading on GDP. Good time to talk about the Japanese 0:21:16.440 --> 0:21:21.399 economy now. Japan's businesses increased spending for the fourth straight quarter. 0:21:21.800 --> 0:21:25.560 That was a sign of the country's recovery from the pandemic. However, 0:21:25.960 --> 0:21:29.919 a surprise drop in industrial production does suggest a week's 0:21:29.920 --> 0:21:33.000 start to the second quarter, and it raises the risk 0:21:33.119 --> 0:21:35.199 that the bounce in GDP that we saw in the 0:21:35.240 --> 0:21:38.800 first quarter could lose some vigor in the second quarter. 0:21:39.080 --> 0:21:43.320 Paul Jackson, Bloomberg's Japan, Korea Economy and Government editor for Asia, 0:21:43.720 --> 0:21:45.240 joins us So. 0:21:45.280 --> 0:21:45.560 Paul. 0:21:45.880 --> 0:21:48.639 We note that the capex number was pretty strong, up 0:21:48.680 --> 0:21:53.480 eleven percent year on year, but the factory output number disappointing. 0:21:53.640 --> 0:21:56.280 What are we expecting for this next reading on GDP 0:21:56.400 --> 0:21:57.120 in the coming week. 0:21:57.280 --> 0:22:02.000 First of all, we've the reading all first quarter GDP 0:22:03.040 --> 0:22:06.359 should still be a positive. I think we should see 0:22:06.400 --> 0:22:11.760 signs that there is this moderate recovery coming through, helped 0:22:11.880 --> 0:22:15.920