WEBVTT - BoJ Gets A New Boss And Inflation Expectations

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<v Speaker 1>This is Bloomberg Daybreak here for this Tuesday, the fourteenth

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<v Speaker 1>of February in London. Coming up today to yield or

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<v Speaker 1>enough to yield, Japan nabinates Casuo Wada to head the

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<v Speaker 1>Bank of Japan. Great inflation expectations the FEDS. Bowman says

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<v Speaker 1>raids will need to head higher. A lucrative bonds George

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<v Speaker 1>Sarros loads up on corporate debt as a top JP

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<v Speaker 1>Morgan strategist says it's time to dick Stark's Amazon's fourteen

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<v Speaker 1>billion dollar experiment, a time of distress and broker it

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<v Speaker 1>like Beckham. Those are the stories we're looking at in

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<v Speaker 1>today's papers. I'm James Walcock, class taking the air out

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<v Speaker 1>of balloon in Tension's top diplomats from the US and

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<v Speaker 1>China consider a sit down that's all straight ahead. On

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<v Speaker 1>Bloomberg Daybreak Europe. The business news you need to start

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<v Speaker 1>your day in just one fifteen minute podcast on Apple, Spotify,

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<v Speaker 1>the Bloomberg Business app, and everywhere you get your podcasts.

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<v Speaker 1>Good morning, I'm Stephen Carroll and I'm Caroline Hecker. Here

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<v Speaker 1>all the stories that we're following today. Cazu Wada has

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<v Speaker 1>been nominated as the next governor of the Bank of Japan.

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<v Speaker 1>Analysts expect the move to pave the way for a

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<v Speaker 1>gradual pairing back of the central banks bond buying program.

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<v Speaker 1>Former b o J Assistant governor Casua Moment says he

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<v Speaker 1>expects a wated to tread carefully at some point. Mr

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<v Speaker 1>DA is trying to find a way to abandon completely

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<v Speaker 1>the u c of control, but on condition that it

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<v Speaker 1>doesn't occur upset any people if I the GUARY market,

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<v Speaker 1>the people or the government. So if the conditions met,

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<v Speaker 1>I see ms that we try to abandon u CUB

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<v Speaker 1>control relaterally soon. Cas b o J nomination comes as

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<v Speaker 1>Japan's economy returned to growth in the fourth quarter. GDP

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<v Speaker 1>expanded at an annualized pace of point six percent, falling

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<v Speaker 1>short of the two percent estimate from economists. Now. Federal

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<v Speaker 1>Reserve Governor Michelle Bowman says that the US Central Bank

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<v Speaker 1>will probably have to keep raising rates to rane in

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<v Speaker 1>price growth. Bowman says that the need for further hikes

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<v Speaker 1>makes a soft landing unlikely. We are still far from

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<v Speaker 1>achieving price stability, and I expected that it will be

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<v Speaker 1>necessary to further tighten monetary policy to bring down inflation

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<v Speaker 1>toward our goal. Doing so will likely lead to subdued

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<v Speaker 1>growth in economic activity and some softening in labor market conditions.

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<v Speaker 1>Bowman's comments echo those of the FED chair your own Pal,

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<v Speaker 1>who told Bloomberg last week that further rate hikes will

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<v Speaker 1>be needed to quash inflation. Economists expect call US CPI

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<v Speaker 1>data out at one thirty pm London time today to

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<v Speaker 1>show a five and a half percent rise from a

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<v Speaker 1>year earlier. Bloomberg understands President Biden will name FED Vice

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<v Speaker 1>Chairlo Brainard as his top economic advisor. She's considered one

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<v Speaker 1>of the Central Bank's most devilsh members and recently indicated

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<v Speaker 1>that inflation could come down without too much damage to employment.

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<v Speaker 1>Brainer has moved to the White House, creates an opening

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<v Speaker 1>at the Federal Reserve, although it's not yet clear who

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<v Speaker 1>Biden would nominate to succeed her. Bloomberg has learned that

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<v Speaker 1>a former Credit Swiss employee copied and took personal data

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<v Speaker 1>from other staff members, including descriptions of their compensation and

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<v Speaker 1>bank account information. The company warned of the breach, which

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<v Speaker 1>took place some years ago, in a letter to staff.

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<v Speaker 1>The staff member had legitimate access to the data at

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<v Speaker 1>the time and transferred it to a personal device in

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<v Speaker 1>breach of credit sweez policies. Stocks may be rallying, but

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<v Speaker 1>thirteen filings show some of finance's biggest names have been

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<v Speaker 1>ditching equity for debt. Bloomberg's Valery title has the story

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<v Speaker 1>George Soros's investment firm plowed hundreds of millions of dollars

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<v Speaker 1>into bonds last year. A corporate debt ETF is now

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<v Speaker 1>the third largest holding in its five point seven billion

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<v Speaker 1>dollar US equity portfolio, and Soros Fund Management isn't alone

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<v Speaker 1>on taking advantage of these higher rates. Even JP Morgan's

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<v Speaker 1>normally bullish strategist Marko Klonovitch, is evre in government debt

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<v Speaker 1>over stocks. In a note yesterday, he called the equity

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<v Speaker 1>market complacent, saying they were overpricing recent good news on inflation.

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<v Speaker 1>He recommended fading this year's stock rally. In London, Valerie

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<v Speaker 1>title Bloomberg Daybreak Europe now away from the markets and

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<v Speaker 1>onto some politics. Bloomberg has learned that the U s

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<v Speaker 1>Sectary of State Anthony B. Lincoln, is considering sitting down

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<v Speaker 1>with his Chinese counterpart Wang Yee So also say the

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<v Speaker 1>two would meet at the Munich Security Conference later this week,

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<v Speaker 1>provided both sides agree. Speaking ahead of the conference, the

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<v Speaker 1>NATO Secretary General Yain Stoltenberg warned of the growing intelligence

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<v Speaker 1>threat from Beijing and elsewhere. We see it in cyber

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<v Speaker 1>We see it with satellites, more and more satellites, and

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<v Speaker 1>we see them with the balloons. That highlights the importance

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<v Speaker 1>of our vigilance are increased presence, and also that we

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<v Speaker 1>ramp up and step up how we share intelligence and

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<v Speaker 1>how we monitor and protect our airspace. The NATO Secretary

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<v Speaker 1>General spoke as the US recovered what it calls significant

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<v Speaker 1>debris from the remains of the balloon shot down off

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<v Speaker 1>the coast of South Carolina last week. Those are our

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<v Speaker 1>top stories this morning. One of those stories on the

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<v Speaker 1>Bloomberternal this morning that caught my eye is to do

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<v Speaker 1>with regular office spending habits. Now it's Valentine's Day, but

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<v Speaker 1>some things that after the workers are not buying each

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<v Speaker 1>other as launch apparently no five quitter sandwich, no thank

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<v Speaker 1>you very much. Look people going back to officers though

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<v Speaker 1>immediately post pandemic they were splurging, they were going out,

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<v Speaker 1>they were buying the expensive coffee. The excitement, Yes, but

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<v Speaker 1>at the cost of living crisis has crushed all of that. Yeah,

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<v Speaker 1>not so good for for the retailers. That's kind of

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<v Speaker 1>one end of things. Then the opposite end also, so

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<v Speaker 1>the UK's new register for overseas owners beneficial owners of

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<v Speaker 1>property in the UK. I think it's such a fascinating story, right,

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<v Speaker 1>it's the government kind of lifting the lid on who

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<v Speaker 1>owns properties in the UK. We've crunched the numbers. Very

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<v Speaker 1>interesting names that pop up now. Yes, indeed, the Russian

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<v Speaker 1>tycoon Alexandra Frolov, you know, former chief executive of the

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<v Speaker 1>Russian Steel book ever as just one of those who's

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<v Speaker 1>who's featured in this story by OAR colleague Banjamin Stopples

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<v Speaker 1>today about people who are showing up on this list

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<v Speaker 1>of people who have registered properties. Yeah, you've got James

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<v Speaker 1>Dieton is the ucas richest person, Steff, I'm person the

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<v Speaker 1>man behind the Swedish retailer H and M. And yes,

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<v Speaker 1>Saudi Arabian is Al Raji family, the rule of Dubai.

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<v Speaker 1>I mean, so many names, really interesting. Also, I like

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<v Speaker 1>this piece because we're going to blow our own trumpet,

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<v Speaker 1>which is that we interviewed the minister Martin Callen and

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<v Speaker 1>around this. You know, this is a kind of effort

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<v Speaker 1>in the UK to bring a bit more transparency. So yeah,

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<v Speaker 1>the piece, um so basically now people who own property

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<v Speaker 1>tracts of lands in the UK, they do have to

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<v Speaker 1>kind of declare themselves what a perfect summary of our

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<v Speaker 1>diverging interests. I'm worried about sandwiches, and Caroline is worried

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<v Speaker 1>about luxury property. Right, coming up next Amazon's fourteen billion

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<v Speaker 1>dollar experiment tie of distress and broker it like Beckham,

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<v Speaker 1>now the paper review on Blue Birthday Break Europe. The

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<v Speaker 1>news you need to know from today's papers. It makes

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<v Speaker 1>James Wilcock joins us now for that, James is a

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<v Speaker 1>bit of a mix in the newspapers today. So so

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<v Speaker 1>I'm talking about defense Ukraine and spy balloons, and some

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<v Speaker 1>about the coming council tax hikes and that cost of

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<v Speaker 1>living crisis in the UK. The first headline though, that

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<v Speaker 1>we'll talk about is in the telegraph and I catching

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<v Speaker 1>line asking can men ever get Valentine's Day? Right? I

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<v Speaker 1>mean that was my pivots Caroline talking about David Becker

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<v Speaker 1>the Telegraphic and day, can then ever get Valentine's day, right, However,

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<v Speaker 1>what I really want to talk about the teleraph is

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<v Speaker 1>this idea that David Becker has been approached to touch

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<v Speaker 1>front Manchester United takeover bids. Now, so what I find

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<v Speaker 1>me interesting about that sports story, outside of sort of

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<v Speaker 1>the loving with Valentine's Day, is that it is Premier

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<v Speaker 1>League's most valuable club, Benches United, and it is one

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<v Speaker 1>of the world's top three most valuable estimates ranging that

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<v Speaker 1>valuation sort of four to six billion now given back

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<v Speaker 1>in two thousand and five, the Glazer family bought it

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<v Speaker 1>for eight hundred million in a lever buyout. That return

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<v Speaker 1>is quite impressive as well as that the Athletic calculate

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<v Speaker 1>that nearly four hundred and fifty million has been taken

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<v Speaker 1>out of the company sort of through I p O

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<v Speaker 1>share fields and dividends since then. But yeah, but the

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<v Speaker 1>thing is David Beckham may have been approached, but actually

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<v Speaker 1>he's not attached himself to any bids. Has This is

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<v Speaker 1>what's so interesting that to me about buying a company

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<v Speaker 1>of us as buying a football club. They often said

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<v Speaker 1>there's no money in it, but again the Glazer family

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<v Speaker 1>show there can be money made. But unlike any other company,

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<v Speaker 1>you have to win over the fans, so they've approached.

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<v Speaker 1>There are it's rumored a roughly sort of four or

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<v Speaker 1>five kind of big bidders at this final stage the

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<v Speaker 1>soft deadline for Friday, and there have been some rumors

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<v Speaker 1>that David Beckham has been approached to endure front of

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<v Speaker 1>these bids. When Chelsea was brought out recently, Serena Williams

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<v Speaker 1>and Lewis Hamilton's were targeted because the idea being you

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<v Speaker 1>get a big celebrity endorsement and it might give you

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<v Speaker 1>the edge and getting the fans on board. The other

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<v Speaker 1>side of the facetting, those like you say Beckham hasn't

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<v Speaker 1>attached himself to any bid because he's actually going more

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<v Speaker 1>of an investment focus himself. There's often more money for

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<v Speaker 1>these big famous celebrity footballers now in starting their own

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<v Speaker 1>companies and big investment vehicles. I mean, you look at St.

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<v Speaker 1>Michael Jordan's whose estimated net worth is now one billion

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<v Speaker 1>dollars due to his investment, not his endorsements. Okay, I'm

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<v Speaker 1>going to steer us neatly away from the sports news

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<v Speaker 1>and inflation in the Times today, inflation putting frames over

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<v Speaker 1>the edge. What says about So, I mean, we've been

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<v Speaker 1>hearing all this grimy cann't use to quite a while, Stephen,

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<v Speaker 1>and we go from that to the idea of, well,

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<v Speaker 1>how do you find out which companies are going to

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<v Speaker 1>go bust? Well, you talk to the experts. City restructuring specialists.

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<v Speaker 1>AFP of Advisory has told their shareholders expect more restructuring

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<v Speaker 1>in the coming months. So if the company that gets

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<v Speaker 1>money off doing these kind of restructurings is saying like

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<v Speaker 1>load up and get ready, that's worth keeping an eye on.

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<v Speaker 1>As well as that, researched by Earnestly Young found that

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<v Speaker 1>eleven percent of companies issued profit warnings in the fine

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<v Speaker 1>quarter of two citing type of credit conditions. That was

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<v Speaker 1>the first time since two thousand nine when more than

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<v Speaker 1>ten percent of companies issue profit warnings given those kind

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<v Speaker 1>of conditions. So we have the sort of the tickers

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<v Speaker 1>of these big red warning lights are on the upside.

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<v Speaker 1>I'm a phrase, well, look if I'm not very much mistaken.

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<v Speaker 1>We spoke to e Y about that report about a

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<v Speaker 1>month ago. So interesting, yes, though, that there is this

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<v Speaker 1>kind of building consensus around the worry of, you know,

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<v Speaker 1>companies getting into trouble defaulting or being under such pressure.

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<v Speaker 1>Look just last see the Ft has an interesting interview

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<v Speaker 1>with the Amazon CEO and d Jassey. Yeah, of me,

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<v Speaker 1>I'd see this is an Uplifting story, so because it's

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<v Speaker 1>a tech story, Caroline. Amazon has said that they are

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<v Speaker 1>scaling back their grocery sort of business, and they bought

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<v Speaker 1>Whole Foods five years ago for about fourteen billion dollars

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<v Speaker 1>and since then it has not been a big success

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<v Speaker 1>for them. They have just failed to crack retail and

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<v Speaker 1>analyst Tho's amiss that they just don't understand it. They

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<v Speaker 1>don't understand shop thing, They don't stand real bricks and mortar.

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<v Speaker 1>Why I find that Uplifting is a company that has

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<v Speaker 1>revolutionized online shopping and completely change the way we buy stuff,

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<v Speaker 1>still can't crack some of the things that some of

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<v Speaker 1>the older businesses can still do going into a shop,

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<v Speaker 1>how a store feels, how it works. But this interew

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<v Speaker 1>with the Ft says they're not giving up yet. They

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<v Speaker 1>put a lot of that story down to the pandemic

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<v Speaker 1>and they intend to double down on that investment. Although

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<v Speaker 1>they're not open aly new stores, they expect a lot

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<v Speaker 1>more experimentation in the space and still think there was

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<v Speaker 1>a future for the high street and having a physical store. Well, listen,

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<v Speaker 1>there is. There's one of those Amazon shops on my

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<v Speaker 1>high street. I must admit to having some difficulties actually

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<v Speaker 1>getting into the shop because it's all completely electronic. There's

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<v Speaker 1>nobody present. Yeah, it's just waving from the outsider saying

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<v Speaker 1>that looks nice. Well I had to figure it out

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<v Speaker 1>on the phone. Come on, how to get into the

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<v Speaker 1>twenty first century? Okay, very good, okay, very good, Thank

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<v Speaker 1>you very much. James Willcock for that review of the

0:11:52.559 --> 0:11:56.000
<v Speaker 1>papers this morning where the Japanese government has nominated Cazo

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<v Speaker 1>Wada to lead the Bank of Japan. He was somewhat

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<v Speaker 1>of a surprise pick. But what does it mean for policy?

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<v Speaker 1>Joining us now is Boomberg's kareem more from Tokyo. Good

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<v Speaker 1>morning to you and from London. What is next in

0:12:08.800 --> 0:12:12.600
<v Speaker 1>this process? Then? What happens after today? Yes, good morning,

0:12:12.800 --> 0:12:16.920
<v Speaker 1>that's three. Japanese Prime Minister Kishida submitted the official nomination

0:12:17.080 --> 0:12:20.360
<v Speaker 1>to parliament today. Uh and it's just the first step

0:12:20.520 --> 0:12:24.120
<v Speaker 1>in a week's long process. So it will be take

0:12:24.840 --> 0:12:27.280
<v Speaker 1>the next couple of months to really replace Kududa, who

0:12:27.320 --> 0:12:29.319
<v Speaker 1>has been at the top of the b o J

0:12:29.600 --> 0:12:32.079
<v Speaker 1>for the past ten years now, So now that the

0:12:32.200 --> 0:12:35.160
<v Speaker 1>nominations are official and that's out of the way, and

0:12:35.280 --> 0:12:37.720
<v Speaker 1>probably no more surprise because we can look to February.

0:12:38.920 --> 0:12:41.000
<v Speaker 1>We'll mark that on our calendars. That's what traders will

0:12:41.000 --> 0:12:43.280
<v Speaker 1>want to watch because that's the next big day to

0:12:43.400 --> 0:12:46.120
<v Speaker 1>keep an eye on when the parliamentary hearings begin at

0:12:46.200 --> 0:12:49.280
<v Speaker 1>the lower end upper House. So basically what happens is

0:12:49.720 --> 0:12:52.280
<v Speaker 1>this bo J governor of the new Governor of Casowia

0:12:52.520 --> 0:12:55.160
<v Speaker 1>will likely get grilled on his policy stance and be

0:12:55.320 --> 0:12:58.760
<v Speaker 1>asked about the exit strategy for the current monetary policy

0:12:59.160 --> 0:13:01.600
<v Speaker 1>and it's all part of the vetting process, but traders

0:13:01.640 --> 0:13:04.319
<v Speaker 1>will be hanging on to his every word and that

0:13:04.440 --> 0:13:06.559
<v Speaker 1>could really have see the Maltili in the yend like

0:13:06.600 --> 0:13:08.640
<v Speaker 1>we saw on Friday night with his announced as the

0:13:08.720 --> 0:13:11.439
<v Speaker 1>present announcement that he would be the next b o

0:13:11.640 --> 0:13:15.240
<v Speaker 1>J governor. Then if all goes as planned, the deputies

0:13:15.280 --> 0:13:18.800
<v Speaker 1>there are two deputies deputy governors of the b o J.

0:13:18.920 --> 0:13:23.079
<v Speaker 1>Also we're nominated today. They'll start on March twentieth, and

0:13:23.160 --> 0:13:25.400
<v Speaker 1>that's a few weeks ahead of the b o J

0:13:25.640 --> 0:13:29.120
<v Speaker 1>governor who will start on April nine. Okay, what do

0:13:29.200 --> 0:13:32.200
<v Speaker 1>we know of the of the deputy governors then, who

0:13:32.240 --> 0:13:35.599
<v Speaker 1>are going to be, as you mentioned, nominated, Yes, so

0:13:35.679 --> 0:13:39.480
<v Speaker 1>the deputy governor is actually uh, it's an interesting case

0:13:39.640 --> 0:13:42.880
<v Speaker 1>here in terms of diversity. It's not exactly what we

0:13:43.080 --> 0:13:47.599
<v Speaker 1>wanted in terms of having in Japan have leadership with

0:13:47.920 --> 0:13:52.559
<v Speaker 1>women in the top The two incoming DEPTHT governors have

0:13:52.640 --> 0:13:56.880
<v Speaker 1>the name does she and both men of course both

0:13:57.000 --> 0:14:01.040
<v Speaker 1>qualified and but the top three are again once again

0:14:01.320 --> 0:14:04.800
<v Speaker 1>all meant the expecting we were expecting the former bo

0:14:04.840 --> 0:14:08.160
<v Speaker 1>J official actually you okinah, she's a woman to actually

0:14:08.200 --> 0:14:12.160
<v Speaker 1>be nominated as one of the two incoming deputy governors,

0:14:12.320 --> 0:14:16.000
<v Speaker 1>but that didn't happen. So this nomination by Keshia really

0:14:16.360 --> 0:14:20.440
<v Speaker 1>underscores the hurdles that women facing here in Japan and

0:14:20.520 --> 0:14:22.720
<v Speaker 1>continue to face in Japan. The FED of course that

0:14:22.840 --> 0:14:26.480
<v Speaker 1>Janet Yellen ecp as Christine Lagard, so the b o

0:14:26.560 --> 0:14:29.840
<v Speaker 1>J not really keeping up in that sense. It's still

0:14:30.240 --> 0:14:32.800
<v Speaker 1>seems like a really long way to go here in

0:14:32.960 --> 0:14:37.240
<v Speaker 1>Japan when it comes to diversity, especially in leadership positions.

0:14:39.600 --> 0:14:42.320
<v Speaker 1>This is Bloomberg Daybreak Europe, your morning brief on the

0:14:42.400 --> 0:14:45.360
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0:14:45.720 --> 0:14:49.640
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