1 00:00:02,640 --> 00:00:05,240 Speaker 1: This is Bloomberg day Break Weekend, our global look at 2 00:00:05,240 --> 00:00:07,680 Speaker 1: the top stories in the coming week from our Daybreak 3 00:00:07,720 --> 00:00:10,360 Speaker 1: anchors all around the world. Straight ahead on the program, 4 00:00:10,400 --> 00:00:13,920 Speaker 1: a jobs report or maybe not, we get a preview 5 00:00:13,920 --> 00:00:16,479 Speaker 1: of what to expect. I'm Tom Busby in New York. 6 00:00:16,760 --> 00:00:19,040 Speaker 2: I'm Caroline Hepe. You here in London, where we're looking 7 00:00:19,040 --> 00:00:22,000 Speaker 2: ahead to the UK's party political conferences. 8 00:00:22,239 --> 00:00:24,560 Speaker 3: I'm Kaylie Lyons, getting ready to make the trip from 9 00:00:24,640 --> 00:00:27,160 Speaker 3: Washington to New York for the start of the trial 10 00:00:27,360 --> 00:00:28,440 Speaker 3: of Sam Bankman Freed. 11 00:00:28,840 --> 00:00:31,160 Speaker 4: I'm Doug Prisner, the first woman to lead the Reserve 12 00:00:31,200 --> 00:00:34,320 Speaker 4: Bank of Australia, will guide a decision on interest rates 13 00:00:34,360 --> 00:00:34,880 Speaker 4: this week. 14 00:00:37,400 --> 00:00:41,479 Speaker 5: That's all straight ahead on Bloomberg Daybreak Weekend, the business 15 00:00:41,479 --> 00:00:43,839 Speaker 5: news you need to wrap up your week in just 16 00:00:43,960 --> 00:00:48,560 Speaker 5: one fifteen minute podcast available on Apple, Spotify, The Bloomberg 17 00:00:48,600 --> 00:01:00,000 Speaker 5: Business Appen everywhere you get your podcasts. 18 00:01:00,000 --> 00:01:02,200 Speaker 1: Who I'm Tom Busby. We begin today's program with a 19 00:01:02,240 --> 00:01:04,880 Speaker 1: look at the September jobs report coming out this Friday 20 00:01:05,400 --> 00:01:08,160 Speaker 1: or is it. With the government shut down, a lot 21 00:01:08,200 --> 00:01:11,200 Speaker 1: of data critical to Wall Street investors will not be 22 00:01:11,240 --> 00:01:14,040 Speaker 1: released until a bill, even a short term stopgap bill 23 00:01:14,120 --> 00:01:17,520 Speaker 1: to fund the federal government is passed. To talk about 24 00:01:17,520 --> 00:01:19,959 Speaker 1: what we can expect with Washington and to stand still, 25 00:01:20,000 --> 00:01:24,280 Speaker 1: we welcome Bloomberg International Economics and Policy correspondent Michael McKee. Michael, 26 00:01:24,319 --> 00:01:24,680 Speaker 1: thank you. 27 00:01:24,840 --> 00:01:26,839 Speaker 6: Happy to be here. At least I'm here. 28 00:01:27,120 --> 00:01:31,119 Speaker 1: Yeah, yeah, that's right. Someone's working well, Michael, we've all 29 00:01:31,120 --> 00:01:34,720 Speaker 1: been here before. Twenty government shutdown since nineteen seventy seven, 30 00:01:34,760 --> 00:01:37,120 Speaker 1: the latest one thirty five days long. That was in 31 00:01:37,200 --> 00:01:44,280 Speaker 1: late twenty eighteen. It's horrible, but let's talk. Let's start 32 00:01:44,319 --> 00:01:49,360 Speaker 1: with what is not affected. Social Security and the Postal Service. 33 00:01:49,120 --> 00:01:56,480 Speaker 7: Right right, well, and Medicare goes forward. The programs that 34 00:01:56,600 --> 00:02:01,720 Speaker 7: our entitlements are funded separately from all of this. There 35 00:02:01,800 --> 00:02:06,520 Speaker 7: is no mechanism to reauthorize them, so they will go out. 36 00:02:07,480 --> 00:02:12,200 Speaker 7: The problem is if enough people at the Social Security 37 00:02:12,240 --> 00:02:13,720 Speaker 7: Administration come in to lick. 38 00:02:13,600 --> 00:02:14,520 Speaker 6: The stamps, I guess. 39 00:02:14,880 --> 00:02:19,880 Speaker 7: But the Postal Service is also self funded. The Federal 40 00:02:19,919 --> 00:02:23,120 Speaker 7: Reserve will be open because they are self funded, so 41 00:02:23,240 --> 00:02:27,280 Speaker 7: not everything is closed, and most parts of the government 42 00:02:27,320 --> 00:02:30,720 Speaker 7: that the public would interact with will be closed, although 43 00:02:31,280 --> 00:02:36,320 Speaker 7: there are exceptions for workers in what they call public 44 00:02:36,400 --> 00:02:41,400 Speaker 7: safety facing or jobs like air traffic controllers. 45 00:02:41,520 --> 00:02:42,200 Speaker 6: People like that. 46 00:02:42,320 --> 00:02:45,079 Speaker 1: Well, that's I think that's a good thing. But there 47 00:02:45,120 --> 00:02:48,600 Speaker 1: are nearly three million workers who will be out of 48 00:02:48,639 --> 00:02:50,040 Speaker 1: work or told to stay. 49 00:02:49,800 --> 00:02:53,280 Speaker 7: Home essentially, whether it's just over two point nine million 50 00:02:53,280 --> 00:02:58,560 Speaker 7: federal workers and about the guess is eight hundred thousand 51 00:02:58,639 --> 00:03:00,720 Speaker 7: or so will be told to stay home. Others will 52 00:03:00,720 --> 00:03:03,960 Speaker 7: come to work but will not get paid. Now that 53 00:03:04,000 --> 00:03:07,880 Speaker 7: includes one point three members of the active duty military 54 00:03:08,280 --> 00:03:10,160 Speaker 7: who are going to be putting their lives on the 55 00:03:10,200 --> 00:03:13,440 Speaker 7: line for you for free for the time being. Now, 56 00:03:13,480 --> 00:03:17,680 Speaker 7: everybody gets paid according to law that was actually adopted 57 00:03:17,720 --> 00:03:22,440 Speaker 7: after that last government shutdown. It was customary before. Now 58 00:03:22,440 --> 00:03:25,200 Speaker 7: it's a law that back pay is made up, so 59 00:03:25,360 --> 00:03:27,400 Speaker 7: they will get paid eventually. But it does create a 60 00:03:27,440 --> 00:03:29,359 Speaker 7: hardship for all those people because they have to tell 61 00:03:29,360 --> 00:03:31,720 Speaker 7: the credit card company, I don't have the money this month. 62 00:03:31,960 --> 00:03:33,320 Speaker 6: I'll have it maybe next month. 63 00:03:33,440 --> 00:03:35,680 Speaker 1: Yeah, call me next month. I mean, that's a lot 64 00:03:35,720 --> 00:03:38,200 Speaker 1: of spending power as we enter the fourth quarter of 65 00:03:38,280 --> 00:03:40,760 Speaker 1: people who and these people need that money. 66 00:03:41,040 --> 00:03:44,680 Speaker 7: Yeah, that's a problem for the economy if it goes 67 00:03:44,720 --> 00:03:49,800 Speaker 7: that long. I'm not the political correspondent in Washington these days, 68 00:03:49,840 --> 00:03:52,520 Speaker 7: but there does seem to be a feeling that this 69 00:03:52,560 --> 00:03:55,200 Speaker 7: one could be longer than the ones in the past, 70 00:03:55,200 --> 00:03:57,720 Speaker 7: and if that's the case, then you have an issue 71 00:03:57,760 --> 00:04:00,720 Speaker 7: for the economy. Now, what we find in the past 72 00:04:00,840 --> 00:04:03,680 Speaker 7: is that most of that is made up right away 73 00:04:03,800 --> 00:04:05,240 Speaker 7: because people get their back. 74 00:04:05,080 --> 00:04:08,320 Speaker 6: Pay and they go out and spend the things. 75 00:04:08,520 --> 00:04:10,960 Speaker 7: The people who get hurt are the people who might say, 76 00:04:11,040 --> 00:04:13,360 Speaker 7: run a restaurant or something like that because you don't 77 00:04:13,360 --> 00:04:14,800 Speaker 7: have money, you're not going to go out to dinner. 78 00:04:14,840 --> 00:04:18,360 Speaker 7: Well you can't redo that dinner because the day is passed. 79 00:04:18,760 --> 00:04:21,400 Speaker 6: So there will be hardships around the country. 80 00:04:21,760 --> 00:04:25,040 Speaker 7: And one of the things that people don't realize is 81 00:04:25,040 --> 00:04:27,320 Speaker 7: that the federal government has spread all over These two 82 00:04:27,360 --> 00:04:31,159 Speaker 7: point nine million people are in every fifty states, every 83 00:04:31,160 --> 00:04:33,239 Speaker 7: one of the fifty states. They're all across the country, 84 00:04:33,560 --> 00:04:35,520 Speaker 7: so you'll feel it in your own state. 85 00:04:36,640 --> 00:04:38,920 Speaker 1: Well, there's also you know, like you say, the restaurant 86 00:04:39,000 --> 00:04:43,440 Speaker 1: right outside Elgin Air Force Base, you know, the store 87 00:04:43,520 --> 00:04:45,360 Speaker 1: right outside where everybody gets you know. 88 00:04:46,920 --> 00:04:49,160 Speaker 7: One of the big problems, of course we laugh about it, 89 00:04:49,200 --> 00:04:51,600 Speaker 7: is that they always close the national parks because that 90 00:04:51,640 --> 00:04:54,400 Speaker 7: provides a sign that says closed that the TV people 91 00:04:54,440 --> 00:04:57,599 Speaker 7: can take a picture of and represent the shutdown. But 92 00:04:57,680 --> 00:05:00,440 Speaker 7: there are a lot of tourist businesses outside of national 93 00:05:00,480 --> 00:05:01,440 Speaker 7: parks that. 94 00:05:01,760 --> 00:05:04,760 Speaker 6: Will be in trouble. And in California they're talking. 95 00:05:04,520 --> 00:05:08,680 Speaker 7: About using some of the money that they get from 96 00:05:08,760 --> 00:05:11,919 Speaker 7: a state lottery to keep some of those places open 97 00:05:12,200 --> 00:05:16,039 Speaker 7: because they will be in trouble if this goes on 98 00:05:16,120 --> 00:05:16,680 Speaker 7: for a long time. 99 00:05:16,839 --> 00:05:19,360 Speaker 1: Yeah, it's a real hardship for a lot of business owners, 100 00:05:19,480 --> 00:05:21,480 Speaker 1: not congress members, though they still get paid. 101 00:05:21,600 --> 00:05:26,640 Speaker 7: Congress members get paid, and the President gets paid because 102 00:05:26,680 --> 00:05:30,719 Speaker 7: there are constitutional provisions that would keep them from. 103 00:05:32,440 --> 00:05:33,200 Speaker 6: Not getting paid. 104 00:05:33,640 --> 00:05:36,240 Speaker 7: But everybody else at the White House and all the 105 00:05:36,240 --> 00:05:40,240 Speaker 7: staffers on Capitol Hill are not getting paid. The interesting 106 00:05:40,240 --> 00:05:44,000 Speaker 7: thing about the law time too, is that people can't volunteer. 107 00:05:44,480 --> 00:05:46,840 Speaker 7: You're not allowed to volunteer to work for free. If 108 00:05:46,839 --> 00:05:48,920 Speaker 7: they send you home, your home. 109 00:05:48,880 --> 00:05:51,920 Speaker 1: Your home, that's it, and you'll wait until it's over. 110 00:05:52,800 --> 00:05:56,200 Speaker 1: Until it's over. Let's talk about how this could impact 111 00:05:56,520 --> 00:06:00,279 Speaker 1: Wall Street investors and the economy. And let's talk about 112 00:06:00,560 --> 00:06:01,599 Speaker 1: we'll start with Wall Street. 113 00:06:01,640 --> 00:06:04,479 Speaker 7: The SEC. You know there's going to be well, the SEC. 114 00:06:04,800 --> 00:06:07,960 Speaker 7: Most of their work will shut down. You'll still be 115 00:06:08,000 --> 00:06:10,560 Speaker 7: able to if you have to file, You'll still be 116 00:06:10,560 --> 00:06:14,320 Speaker 7: able to upload files to Edgar and so that work 117 00:06:14,360 --> 00:06:16,400 Speaker 7: will go on, but there won't be anybody in the 118 00:06:16,440 --> 00:06:19,400 Speaker 7: office at the SEC, and so a lot of their 119 00:06:19,520 --> 00:06:23,000 Speaker 7: enforcement stuff will go by the boards for. 120 00:06:23,160 --> 00:06:23,840 Speaker 6: The time being. 121 00:06:25,720 --> 00:06:27,720 Speaker 7: If you want to get a passport, you're not going 122 00:06:27,800 --> 00:06:30,039 Speaker 7: to be able to do that while it's shut down 123 00:06:30,720 --> 00:06:34,200 Speaker 7: or anything like that. Government records will not. 124 00:06:34,240 --> 00:06:37,080 Speaker 6: Be accessible if you need to get. 125 00:06:36,920 --> 00:06:40,760 Speaker 7: Your military retirement or a new Medicaid care card or 126 00:06:40,800 --> 00:06:44,160 Speaker 7: something like that. So a lot of things that are 127 00:06:44,360 --> 00:06:48,680 Speaker 7: sort of day to day mundane things won't be happening, 128 00:06:48,960 --> 00:06:52,159 Speaker 7: and that'll start to build up some frustration. But history 129 00:06:52,200 --> 00:06:55,799 Speaker 7: shows Wall Street tends to overlook all of this, and 130 00:06:56,440 --> 00:06:59,800 Speaker 7: the last two, which were the longest ones that we've 131 00:06:59,800 --> 00:07:05,359 Speaker 7: had shutdowns, the market's finished up from the time that 132 00:07:05,440 --> 00:07:08,480 Speaker 7: they shut down to the time that they reopened. So 133 00:07:09,080 --> 00:07:11,560 Speaker 7: it's kind of the figure this is a temporary thing 134 00:07:11,600 --> 00:07:15,000 Speaker 7: that won't last. If it lasts longer, then maybe you 135 00:07:15,080 --> 00:07:19,520 Speaker 7: do have an effect because investors start thinking that consumers 136 00:07:19,560 --> 00:07:21,760 Speaker 7: aren't going to be able to spend as much money, 137 00:07:21,760 --> 00:07:23,440 Speaker 7: and corporate profits go down. 138 00:07:23,520 --> 00:07:27,920 Speaker 1: Big concern. Also, I mean there's some critical data coming out. 139 00:07:28,120 --> 00:07:30,000 Speaker 1: I mean it's always coming out from the government, But 140 00:07:30,120 --> 00:07:32,880 Speaker 1: next week, you know, including the biggie, the jobs report, 141 00:07:32,920 --> 00:07:36,400 Speaker 1: and after a very dismal I would say September for 142 00:07:36,480 --> 00:07:39,240 Speaker 1: the markets, I mean investors accounting on some of this 143 00:07:39,280 --> 00:07:41,120 Speaker 1: coming out, but we may not see. 144 00:07:40,880 --> 00:07:41,640 Speaker 6: We may not see it. 145 00:07:41,720 --> 00:07:47,400 Speaker 7: All of the September data after today is in, and 146 00:07:48,520 --> 00:07:51,800 Speaker 7: they could release it on time if they got a 147 00:07:51,840 --> 00:07:54,960 Speaker 7: quick deal, or they could release it with only a 148 00:07:55,000 --> 00:07:59,240 Speaker 7: few days delay if they don't, but still get settled 149 00:07:59,280 --> 00:08:02,240 Speaker 7: in the coming way. But if it goes longer than that, 150 00:08:02,360 --> 00:08:04,360 Speaker 7: then we won't get the jobs report for a while. 151 00:08:04,600 --> 00:08:07,880 Speaker 7: You've got the CPI coming up on October twelfth, the 152 00:08:07,920 --> 00:08:13,360 Speaker 7: PCE inflation data on October twenty seventh. Those numbers could 153 00:08:13,400 --> 00:08:16,440 Speaker 7: in theory not come out, and then the FED is 154 00:08:16,520 --> 00:08:21,119 Speaker 7: going to be left flying blind at their November first meeting. 155 00:08:21,880 --> 00:08:25,360 Speaker 7: And as one observer said, quite accurately, how are you 156 00:08:25,400 --> 00:08:29,520 Speaker 7: supposed to have a soft landing if the pilots are blind? 157 00:08:30,120 --> 00:08:31,760 Speaker 6: And so for the Fed it'd be difficult. 158 00:08:31,760 --> 00:08:37,559 Speaker 7: Probably means that they don't they don't move on November 159 00:08:37,640 --> 00:08:39,800 Speaker 7: first because they might feel they don't have enough data. 160 00:08:39,840 --> 00:08:42,920 Speaker 7: All the private sector data comes out, the isms, the ADPs, 161 00:08:43,000 --> 00:08:46,360 Speaker 7: things like that, but the government data will not come out, 162 00:08:46,400 --> 00:08:49,120 Speaker 7: and that could be a problem. And then longer term, 163 00:08:49,520 --> 00:08:54,520 Speaker 7: if everybody's off work, then nobody's collecting data. The way 164 00:08:54,559 --> 00:08:59,200 Speaker 7: the jobs numbers work, most of that data would come in. 165 00:08:59,400 --> 00:09:03,320 Speaker 7: But inflation data is what a price is on a 166 00:09:03,320 --> 00:09:07,600 Speaker 7: particular date, and if they don't have that, then if 167 00:09:07,600 --> 00:09:09,600 Speaker 7: they don't collected that date, it would be hard to 168 00:09:09,600 --> 00:09:12,520 Speaker 7: backfill it. So we could end up seeing a month 169 00:09:12,559 --> 00:09:16,440 Speaker 7: without without inflation data, which only makes the fed's job 170 00:09:16,480 --> 00:09:17,000 Speaker 7: even harder. 171 00:09:17,040 --> 00:09:19,679 Speaker 1: That's not good, and we've actually gotten some encouraging data 172 00:09:19,720 --> 00:09:20,480 Speaker 1: about inflation. 173 00:09:21,120 --> 00:09:24,480 Speaker 7: And yeah, last week. Last week the PCE numbers came 174 00:09:24,520 --> 00:09:29,200 Speaker 7: in very low. The core PC was up only tenth 175 00:09:29,240 --> 00:09:32,040 Speaker 7: of a percent, and on an annualized basis, that would 176 00:09:32,040 --> 00:09:35,480 Speaker 7: be inflation of about one percent for the year. So 177 00:09:35,960 --> 00:09:40,120 Speaker 7: we've had a dramatic drop in the Fed's favorite inflation indicator. 178 00:09:40,640 --> 00:09:44,640 Speaker 7: And if that continues, then that may mean the Fed 179 00:09:44,720 --> 00:09:47,000 Speaker 7: is done and may mean the higher for longer longer 180 00:09:47,040 --> 00:09:47,920 Speaker 7: becomes a little shorter. 181 00:09:48,320 --> 00:09:50,200 Speaker 6: But the problems we may not know. 182 00:09:50,520 --> 00:09:53,400 Speaker 1: No, and also, jobless claims have been you know, to 183 00:09:53,760 --> 00:09:55,840 Speaker 1: four to five for a couple of weeks, and we 184 00:09:55,880 --> 00:09:56,880 Speaker 1: haven't seen that in a while. 185 00:09:57,040 --> 00:10:00,640 Speaker 7: Well, that's probably going to change because if you're on strike, 186 00:10:01,320 --> 00:10:03,840 Speaker 7: you can't file for job as claims. But if some 187 00:10:04,000 --> 00:10:06,160 Speaker 7: workers at your plant are on strike and that means 188 00:10:06,160 --> 00:10:09,520 Speaker 7: your plant shuts down so you're just furloughed, then you can. 189 00:10:09,880 --> 00:10:13,760 Speaker 7: And so we will probably see distortions start to come 190 00:10:13,760 --> 00:10:16,280 Speaker 7: in that as the UAW strike expands. 191 00:10:17,040 --> 00:10:19,080 Speaker 1: Well, we got a lot to look forward to and 192 00:10:19,440 --> 00:10:22,280 Speaker 1: a lot to be worried about. Michael, thank you so much. 193 00:10:22,320 --> 00:10:24,520 Speaker 1: In coming up on Bloomberg day Break weekend, we look 194 00:10:24,520 --> 00:10:28,679 Speaker 1: ahead to the UK's political party conferences. I'm Tom Busby 195 00:10:28,760 --> 00:10:41,360 Speaker 1: and this is Bloomberg. This is Bloomberg day Break Weekend, 196 00:10:41,440 --> 00:10:43,800 Speaker 1: our global look ahead of the top stories for investors 197 00:10:43,800 --> 00:10:46,200 Speaker 1: in the coming week. I'm Tom Busby in New York. 198 00:10:46,720 --> 00:10:49,400 Speaker 1: Up later in our program the rise and fall of 199 00:10:49,640 --> 00:10:52,160 Speaker 1: FTX and a preview of the trial of its founder 200 00:10:52,160 --> 00:10:55,920 Speaker 1: and former CEO, Sam Bankman Freed. But first, the UK 201 00:10:56,040 --> 00:10:58,960 Speaker 1: has had a turbulent time with four prime ministers in 202 00:10:59,120 --> 00:11:03,679 Speaker 1: four years and significant economic challenges. Now a general election 203 00:11:03,840 --> 00:11:06,560 Speaker 1: emerging into view in the next sixteen months, so the 204 00:11:06,600 --> 00:11:10,480 Speaker 1: annual party political conference season is getting extra attention. Let's 205 00:11:10,480 --> 00:11:14,520 Speaker 1: bring in Bloomberg Radio anchor Caroline Hepger and Anna Edwards 206 00:11:14,520 --> 00:11:16,880 Speaker 1: in London, with more tom. 207 00:11:16,600 --> 00:11:20,239 Speaker 8: Party leaders, activists, press and all sorts of politicos dispersed 208 00:11:20,240 --> 00:11:23,160 Speaker 8: to various cities across the UK in October for these 209 00:11:23,200 --> 00:11:26,439 Speaker 8: annual party conferences. In the next few days, the Conservatives 210 00:11:26,440 --> 00:11:29,680 Speaker 8: gather in Manchester, and Bloomberg Radio will be there to 211 00:11:29,800 --> 00:11:32,520 Speaker 8: cover it all, including the set piece speeches from the 212 00:11:32,559 --> 00:11:35,480 Speaker 8: Prime Minister Rishi Sunak and Chancellor Jeremy Hunt. 213 00:11:35,640 --> 00:11:38,400 Speaker 2: Well ahead of that, we've been speaking to Bloomberg Opinion 214 00:11:38,400 --> 00:11:42,559 Speaker 2: columnist Adrian Wooldridge about why this year may be different, 215 00:11:42,960 --> 00:11:46,120 Speaker 2: what Wooldridge describes as a feeling of profound change in 216 00:11:46,160 --> 00:11:49,600 Speaker 2: the air in Britain, and we began by asking him firstly, 217 00:11:49,800 --> 00:11:52,320 Speaker 2: what party conference season is really like. 218 00:11:52,640 --> 00:11:54,720 Speaker 9: Well, it used to be something that was really serious, 219 00:11:54,720 --> 00:11:57,760 Speaker 9: particularly on the Labour side, that policy was actually made 220 00:11:58,160 --> 00:12:01,720 Speaker 9: at the party conferences. Now they don't make policy, policies 221 00:12:01,720 --> 00:12:05,600 Speaker 9: made in secret enclaves, but they do so some quite 222 00:12:05,600 --> 00:12:10,040 Speaker 9: important things. One is that they create a certain momentum. 223 00:12:10,200 --> 00:12:12,320 Speaker 9: You know, if you have a good party conference, that's 224 00:12:12,360 --> 00:12:15,160 Speaker 9: good for you. Another is that they create enthusiasm amongst 225 00:12:15,240 --> 00:12:17,160 Speaker 9: the party base, the people who actually knock on the 226 00:12:17,160 --> 00:12:21,240 Speaker 9: doors do all the work. You know, the party conference 227 00:12:21,320 --> 00:12:24,280 Speaker 9: is fun, you know, you get that, you have hi 228 00:12:24,400 --> 00:12:28,160 Speaker 9: japes and you come away enthused. And it's also a 229 00:12:28,200 --> 00:12:31,880 Speaker 9: sort of talent show. The Prime Minister or the leader 230 00:12:31,880 --> 00:12:35,840 Speaker 9: of the opposition has to prove themselves with their speech 231 00:12:35,920 --> 00:12:38,240 Speaker 9: that matters, and also all the other people who are 232 00:12:38,280 --> 00:12:43,160 Speaker 9: maneuvering for a preferment also have to show their wares. 233 00:12:43,280 --> 00:12:45,320 Speaker 8: Okay, so a bit of a showcase then, very much. 234 00:12:45,520 --> 00:12:47,760 Speaker 8: When I've been at these conferences and I've been in 235 00:12:47,800 --> 00:12:51,000 Speaker 8: the sort of large rooms, the larger auditory of where 236 00:12:51,000 --> 00:12:54,439 Speaker 8: they're doing these big set piece speeches, it's really interesting 237 00:12:54,440 --> 00:12:56,400 Speaker 8: because they're talking to the converted, so you'd expect there 238 00:12:56,440 --> 00:12:59,760 Speaker 8: to be lots of applause and appreciation, but sometimes there isn't. 239 00:12:59,800 --> 00:13:02,640 Speaker 8: And I wonder this year with some divisions within the 240 00:13:02,640 --> 00:13:05,440 Speaker 8: Conservative Party, what it is that Suna can Hunt really 241 00:13:05,640 --> 00:13:07,880 Speaker 8: have to get across in their speech is to try 242 00:13:07,920 --> 00:13:08,960 Speaker 8: and win the rooms over. 243 00:13:09,400 --> 00:13:11,960 Speaker 9: I think what Hunt has to get over is the 244 00:13:12,000 --> 00:13:15,600 Speaker 9: idea that things are on the mend. That's the process 245 00:13:15,640 --> 00:13:20,640 Speaker 9: of mopping up the mess that was left by predecessor 246 00:13:21,720 --> 00:13:23,680 Speaker 9: has gone on and they have a vision for the 247 00:13:23,679 --> 00:13:27,640 Speaker 9: future that it's not just an endless process of cleaning 248 00:13:27,760 --> 00:13:31,600 Speaker 9: up and cutting people's living standards. What reci has to do. 249 00:13:31,679 --> 00:13:35,200 Speaker 9: What Sunak has to do is to introduce himself to 250 00:13:35,240 --> 00:13:38,480 Speaker 9: the party. This is his first party speech and people 251 00:13:38,559 --> 00:13:41,000 Speaker 9: don't have a very clear idea of who he is. 252 00:13:41,880 --> 00:13:44,240 Speaker 9: They know a few cliches about him, but they don't 253 00:13:44,720 --> 00:13:46,720 Speaker 9: have a sense of him as a person. And he 254 00:13:46,800 --> 00:13:49,200 Speaker 9: needs to introduce himself to the party but also to 255 00:13:49,240 --> 00:13:52,240 Speaker 9: the country, both as a person but also somebod who 256 00:13:52,240 --> 00:13:53,800 Speaker 9: has a vision of where we need to go in 257 00:13:53,800 --> 00:13:56,040 Speaker 9: the future, not just five things to be ticked off, 258 00:13:56,080 --> 00:13:57,480 Speaker 9: but a natural vision of the country. 259 00:13:57,600 --> 00:13:59,640 Speaker 2: Yeah, of course there's five pleasures from the start of 260 00:13:59,679 --> 00:14:01,840 Speaker 2: this year about what is going to do with the economy. Okay, 261 00:14:02,160 --> 00:14:04,480 Speaker 2: So look, he's not just the Conservatives. The lib Dems 262 00:14:04,480 --> 00:14:06,480 Speaker 2: have already had their party conference in Born, with the 263 00:14:06,600 --> 00:14:10,360 Speaker 2: SMP also a significant force in UK politics overall. And 264 00:14:10,400 --> 00:14:14,840 Speaker 2: then there's Kiss Darma, the Labor Party, very hotly tipped 265 00:14:14,840 --> 00:14:16,840 Speaker 2: in the polls at least for now. What is he 266 00:14:16,920 --> 00:14:18,640 Speaker 2: going to be focused on at conference. 267 00:14:19,040 --> 00:14:21,000 Speaker 9: We have a sense of who he is because he's 268 00:14:21,000 --> 00:14:23,600 Speaker 9: been around for some time. We know his sort of 269 00:14:23,640 --> 00:14:26,640 Speaker 9: conventional Stade fairly boring, but a decent sort of guy. 270 00:14:27,240 --> 00:14:31,480 Speaker 9: And he's more avoiding mistakes than doing anything else. So 271 00:14:31,880 --> 00:14:37,120 Speaker 9: he has to create confidence that he's capable of delivering change, 272 00:14:37,160 --> 00:14:39,840 Speaker 9: that he won't give in to the to the left 273 00:14:39,880 --> 00:14:42,400 Speaker 9: of the party, that he's a safe pair of hands, 274 00:14:42,640 --> 00:14:46,720 Speaker 9: and that he knows how to translate his general vision 275 00:14:46,800 --> 00:14:50,760 Speaker 9: of things into a set of policies that might work. 276 00:14:51,400 --> 00:14:54,520 Speaker 9: His great mistake or his great weakness, I think he's 277 00:14:54,680 --> 00:14:56,760 Speaker 9: talked for too long. I mean the last conference speech 278 00:14:56,800 --> 00:15:00,440 Speaker 9: that I ever that I saw of his life life speech, 279 00:15:00,640 --> 00:15:02,280 Speaker 9: it was a good speech, as a well written speech, 280 00:15:02,320 --> 00:15:04,680 Speaker 9: but just went on and on and on and on. 281 00:15:04,760 --> 00:15:06,120 Speaker 9: You're just waiting for it to end and then you 282 00:15:06,200 --> 00:15:06,760 Speaker 9: start again. 283 00:15:07,200 --> 00:15:08,680 Speaker 2: Well, that's a danger for the whole. 284 00:15:10,560 --> 00:15:12,760 Speaker 9: It is, and I think soon next speeches is being 285 00:15:12,800 --> 00:15:14,520 Speaker 9: trailed as being a very long speech. I think that's 286 00:15:14,560 --> 00:15:16,920 Speaker 9: a mistake. You know, this is not North Korea. You 287 00:15:16,920 --> 00:15:20,280 Speaker 9: know we're supposed to We're supposed to have some sort 288 00:15:20,280 --> 00:15:24,320 Speaker 9: of democratic right to a short attention span. 289 00:15:25,800 --> 00:15:29,640 Speaker 8: But I'm sure that's somewhere an unwritten constitution. Absolutely, let 290 00:15:29,640 --> 00:15:31,680 Speaker 8: me ask you about comparisons with Blair. As we're talking 291 00:15:31,720 --> 00:15:33,840 Speaker 8: about labor. We did a big piece just this week 292 00:15:33,920 --> 00:15:38,240 Speaker 8: on the Big Take Peace. On comparisons with Blair, there 293 00:15:38,240 --> 00:15:40,560 Speaker 8: are some, but then there's also a very different fiscal 294 00:15:40,640 --> 00:15:42,080 Speaker 8: situation that he'll be inheriting. 295 00:15:42,160 --> 00:15:44,200 Speaker 10: I mean, how far do those comparisons get. 296 00:15:44,240 --> 00:15:46,320 Speaker 9: Not very far, really, partly because they're very different people. 297 00:15:46,360 --> 00:15:51,000 Speaker 9: I mean they're both lawyers and they're both middle of 298 00:15:51,080 --> 00:15:54,000 Speaker 9: the road. Tony Blair is more to the right, but 299 00:15:54,080 --> 00:15:57,960 Speaker 9: both sensible politicians. But they're really quite different people. Blair 300 00:15:58,080 --> 00:16:01,440 Speaker 9: was a showman, you know. He you know, he played 301 00:16:01,440 --> 00:16:04,560 Speaker 9: in a rock band at Oxford. He liked as an actor, 302 00:16:04,600 --> 00:16:06,920 Speaker 9: he liked to perform. Kir Starmer isn't like that. He 303 00:16:07,680 --> 00:16:09,680 Speaker 9: is somebody who you know, is more of a sort 304 00:16:09,680 --> 00:16:13,200 Speaker 9: of backroom man in some ways. He doesn't like the 305 00:16:13,800 --> 00:16:15,120 Speaker 9: stage naturally. 306 00:16:14,920 --> 00:16:16,240 Speaker 10: A lot for a back room man. He's picked a 307 00:16:16,280 --> 00:16:17,120 Speaker 10: lot of front room. 308 00:16:17,000 --> 00:16:22,760 Speaker 9: Jobs he has, indeed, But I don't think it's you know, 309 00:16:22,840 --> 00:16:25,360 Speaker 9: he wants power, but I think, and you know, to 310 00:16:25,360 --> 00:16:27,400 Speaker 9: get power you have to do this sort of thing. 311 00:16:27,480 --> 00:16:30,280 Speaker 9: But I think that actually appearing before large groups of 312 00:16:30,280 --> 00:16:33,440 Speaker 9: people is not natural metire in the way that it 313 00:16:33,480 --> 00:16:37,040 Speaker 9: obviously is with Blair. I think the other big difference 314 00:16:37,680 --> 00:16:41,440 Speaker 9: is that the circumstances in nineteen ninety seven were right 315 00:16:41,600 --> 00:16:44,920 Speaker 9: for Blair. They're right for a progressive realignment, both in 316 00:16:45,000 --> 00:16:48,720 Speaker 9: terms of you know, you had a young president of 317 00:16:48,760 --> 00:16:50,800 Speaker 9: the United States with a new set of ideas. You 318 00:16:50,840 --> 00:16:53,080 Speaker 9: had the talk of the Third Way, You had a 319 00:16:53,080 --> 00:16:57,240 Speaker 9: lot of economic room for an sort of expansionist policy. 320 00:16:57,360 --> 00:16:59,640 Speaker 9: All of those things don't exist. We have Joe Biden, 321 00:16:59,680 --> 00:17:03,120 Speaker 9: who's not exactly young in the United States, and we 322 00:17:03,400 --> 00:17:07,920 Speaker 9: have a real shortage of money, not very much room 323 00:17:07,960 --> 00:17:11,399 Speaker 9: to do things. So they keep talking, you know, about 324 00:17:11,520 --> 00:17:14,359 Speaker 9: progressive moment or spending forty billion a year on a 325 00:17:14,359 --> 00:17:17,280 Speaker 9: green revolution and things like that, or you know, getting 326 00:17:17,320 --> 00:17:20,280 Speaker 9: rid of not getting rid of but shoving taxes on 327 00:17:20,560 --> 00:17:24,280 Speaker 9: public schools. And then they come backreat, they retreat, they 328 00:17:24,359 --> 00:17:29,560 Speaker 9: keep retreating, and basically, it's not time for a progressive realignment. 329 00:17:29,600 --> 00:17:31,960 Speaker 9: It's time for a set of pragmatic policies to deal 330 00:17:32,000 --> 00:17:35,359 Speaker 9: with with with with particular problems. 331 00:17:35,640 --> 00:17:39,240 Speaker 2: Well, no doubt, we'll hear this phrase working people many 332 00:17:39,280 --> 00:17:43,360 Speaker 2: many times, hard working people indeed, and who doesn't want 333 00:17:43,400 --> 00:17:46,879 Speaker 2: to be that? But I've heard it. We hear a 334 00:17:46,880 --> 00:17:50,720 Speaker 2: lot from the Labor Party. But actually increasingly. I've heard 335 00:17:50,720 --> 00:17:52,919 Speaker 2: that phrase now from the Prime Minister themselves. So this 336 00:17:52,960 --> 00:17:55,480 Speaker 2: seems to be taking on what are working people and 337 00:17:55,560 --> 00:17:58,080 Speaker 2: voters in the UK do you think, you know, in 338 00:17:58,119 --> 00:17:59,879 Speaker 2: as far as we can take of reading, what do 339 00:17:59,920 --> 00:18:01,960 Speaker 2: you think they're thinking about now? Will they pay any 340 00:18:01,960 --> 00:18:03,680 Speaker 2: attention to party conference? 341 00:18:03,840 --> 00:18:07,919 Speaker 9: Well, one of Tony Blair's great statements was that people 342 00:18:08,040 --> 00:18:10,960 Speaker 9: spend about thirty seconds a year thinking about politics. People 343 00:18:11,000 --> 00:18:13,920 Speaker 9: don't think about politics as much as politicians think that 344 00:18:14,000 --> 00:18:16,760 Speaker 9: they do. And also we're getting a general turn off 345 00:18:17,000 --> 00:18:20,160 Speaker 9: from politics at the moment. I just saw the host 346 00:18:20,200 --> 00:18:22,920 Speaker 9: of the Today program, you know, complaining that people were 347 00:18:22,960 --> 00:18:26,640 Speaker 9: just turning off politics because it's too too awful. So 348 00:18:26,720 --> 00:18:29,520 Speaker 9: I think that people are basically worried about their living 349 00:18:29,560 --> 00:18:31,920 Speaker 9: standards and they want somebody to address those living stats 350 00:18:31,920 --> 00:18:34,400 Speaker 9: that they're want inflation to be brought under control. They 351 00:18:34,400 --> 00:18:38,080 Speaker 9: want the price of food to be more reasonable than 352 00:18:38,119 --> 00:18:40,440 Speaker 9: it might seem at the moment, and I think more broadly, 353 00:18:40,720 --> 00:18:44,760 Speaker 9: they want a sense of order in society. And they 354 00:18:44,760 --> 00:18:46,679 Speaker 9: says if you look at politics, this is chaotic. You know, 355 00:18:46,720 --> 00:18:49,639 Speaker 9: things are falling apart. We go through prime ministers like 356 00:18:49,720 --> 00:18:53,320 Speaker 9: some people go through wives it's. 357 00:18:52,960 --> 00:18:55,520 Speaker 2: Well four and four years, yeah, exactly. 358 00:18:56,680 --> 00:18:59,919 Speaker 9: It's an incredibly unstable environment, so I think people do 359 00:19:00,040 --> 00:19:03,160 Speaker 9: wants stability in a sense of practical policy, right. 360 00:19:03,200 --> 00:19:05,040 Speaker 8: And one thing we'll be watching for, I suppose as 361 00:19:05,040 --> 00:19:08,119 Speaker 8: the conferences get underway is some of the wedge issues 362 00:19:08,240 --> 00:19:11,280 Speaker 8: that will likely feature in the campaigns towards the next election. 363 00:19:11,680 --> 00:19:14,840 Speaker 8: We've heard a bit about net zero from the Conservatives 364 00:19:14,840 --> 00:19:17,440 Speaker 8: and a different take, shall we say on net zero 365 00:19:17,520 --> 00:19:20,359 Speaker 8: around certainly on EV's is this going to be an 366 00:19:20,400 --> 00:19:24,760 Speaker 8: effective wedge issue? Do you think for dividing the population? 367 00:19:24,840 --> 00:19:26,720 Speaker 10: Adrian? Is that is this going to be the one 368 00:19:26,760 --> 00:19:27,919 Speaker 10: that works for the Tories? 369 00:19:28,359 --> 00:19:31,159 Speaker 9: Yes, but I don't think it will work in the 370 00:19:31,200 --> 00:19:33,000 Speaker 9: sense that they'll win the next election. That seems very 371 00:19:33,040 --> 00:19:33,600 Speaker 9: unlikely to me. 372 00:19:33,720 --> 00:19:35,880 Speaker 10: Thanks to Bloomberg's Adrian Wooldridge, I'm Anna. 373 00:19:35,800 --> 00:19:37,960 Speaker 2: Edwards and I'm Kroin Hepker here in London and you 374 00:19:38,000 --> 00:19:41,000 Speaker 2: can catch us every weekday morning for Bloomberg Daybreak. You're 375 00:19:41,040 --> 00:19:43,320 Speaker 2: at beginning at six am in London. That's one am 376 00:19:43,400 --> 00:19:44,040 Speaker 2: on Wall Street. 377 00:19:44,200 --> 00:19:47,280 Speaker 1: Tom, Thanks Caroline and Anna, and coming up on Bloomberg 378 00:19:47,359 --> 00:19:50,600 Speaker 1: Daybreak weekend. Sam Bankman Freed is import this week we'll 379 00:19:50,600 --> 00:19:53,720 Speaker 1: get you the latest. I'm Tom Busby and this is Bloomberg. 380 00:20:04,280 --> 00:20:06,320 Speaker 1: I'm Tom Busby in New York with your global look 381 00:20:06,359 --> 00:20:08,720 Speaker 1: ahead at the top stories for investors in the coming week. 382 00:20:09,200 --> 00:20:11,720 Speaker 1: Sam Bankmin Freed is accused of orchestrating one of the 383 00:20:11,760 --> 00:20:15,919 Speaker 1: biggest white collar crime cases in US history this week. 384 00:20:16,040 --> 00:20:19,280 Speaker 1: The trial starts on Tuesday. For what we can expect, 385 00:20:19,320 --> 00:20:21,479 Speaker 1: let's head to our Bloomberg ninety nine to one newsroom 386 00:20:21,520 --> 00:20:25,520 Speaker 1: in Washington and Bloomberg Sound On. Co host Kaylee lines. 387 00:20:25,520 --> 00:20:28,800 Speaker 3: Yeah, Tom, that's right. Next week, I won't be spending 388 00:20:28,840 --> 00:20:30,840 Speaker 3: the whole week here in Washington because there is a 389 00:20:30,840 --> 00:20:34,760 Speaker 3: big event going on in New York City. Sam Bankman Freed, 390 00:20:34,840 --> 00:20:39,600 Speaker 3: the once billionaire founder of FTX, the now fallen crypto exchange, 391 00:20:40,119 --> 00:20:44,080 Speaker 3: is going to be on trial. It starts this coming Tuesday. 392 00:20:44,440 --> 00:20:46,960 Speaker 3: Ava Benny Morrison, who's one of our great legal reporters 393 00:20:47,000 --> 00:20:50,000 Speaker 3: here at Bloomberg, is joining me to talk about this 394 00:20:50,119 --> 00:20:53,360 Speaker 3: case and what it could mean for Bankman Freed. But first, 395 00:20:53,440 --> 00:20:56,320 Speaker 3: I feel like I need to remind everyone about how 396 00:20:56,359 --> 00:21:00,320 Speaker 3: we got here. Remember, Bankman Freed founded FTX in May 397 00:21:00,320 --> 00:21:03,560 Speaker 3: of twenty nineteen. By October of twenty twenty one, the 398 00:21:03,600 --> 00:21:07,840 Speaker 3: company raised capital out of valuation of twenty five billion dollars, 399 00:21:08,160 --> 00:21:09,919 Speaker 3: and at the end of that year it said it 400 00:21:09,960 --> 00:21:12,640 Speaker 3: had more than five million users globally, about one point 401 00:21:12,720 --> 00:21:15,480 Speaker 3: two million of them in the US. By early twenty 402 00:21:15,480 --> 00:21:18,280 Speaker 3: twenty two, its valuation was thirty two billion dollars. Sam 403 00:21:18,280 --> 00:21:21,080 Speaker 3: Bankman Freed, who then was just thirty years old, was 404 00:21:21,119 --> 00:21:23,840 Speaker 3: worth more than twenty six billion dollars, making him one 405 00:21:23,880 --> 00:21:26,720 Speaker 3: of the world's riches people, and FTX was one of 406 00:21:26,720 --> 00:21:30,640 Speaker 3: the world's biggest crypto exchanges. But in November of last year, 407 00:21:31,040 --> 00:21:33,760 Speaker 3: it unraveled very quickly. It all started with a report 408 00:21:33,800 --> 00:21:36,960 Speaker 3: from coindesk about Alimeta Research, which was a crypto hedge 409 00:21:36,960 --> 00:21:40,240 Speaker 3: fund also founded by Bankman Freed in twenty seventeen, and 410 00:21:40,280 --> 00:21:43,479 Speaker 3: the article found a significant portion of Alameda's assets were 411 00:21:43,560 --> 00:21:47,520 Speaker 3: made up of FTT, that is a token that FTX created. 412 00:21:48,240 --> 00:21:52,120 Speaker 3: In response, cz the CEO of rival crypto exchange Binance, 413 00:21:52,119 --> 00:21:54,399 Speaker 3: said he was going to sell his company's entire holding 414 00:21:54,440 --> 00:21:57,560 Speaker 3: of FTT. That triggered a massive wave of withdrawals, sort 415 00:21:57,560 --> 00:21:59,600 Speaker 3: of like a run on the bank, and FTX didn't 416 00:21:59,600 --> 00:22:02,119 Speaker 3: have the fun to meet them, so in a rescue attempt. 417 00:22:02,240 --> 00:22:04,880 Speaker 3: It reached a deal with Finance to sell itself. Binance 418 00:22:04,920 --> 00:22:08,480 Speaker 3: then backed out and so by November eleventh it was over. 419 00:22:09,040 --> 00:22:13,160 Speaker 3: FTX filed for bankruptcy and bankment. Freed resigned as CEO. 420 00:22:14,119 --> 00:22:17,359 Speaker 3: Just over a month later, on December thirteenth, Sam Bankman 421 00:22:17,400 --> 00:22:21,800 Speaker 3: Freed was indicted accused of misappropriating billions of dollars at 422 00:22:21,840 --> 00:22:24,720 Speaker 3: the cryptocurrency exchange. And this is where we pick the 423 00:22:24,760 --> 00:22:28,080 Speaker 3: story backup with Ava so Eva. If you will just 424 00:22:28,200 --> 00:22:31,040 Speaker 3: remind us of the charges that he is facing. 425 00:22:31,200 --> 00:22:34,679 Speaker 11: So Sam Bankman Freed is facing seven charges in total. 426 00:22:34,840 --> 00:22:37,760 Speaker 11: He's pleaded not guilty to all of them. Those charges 427 00:22:37,800 --> 00:22:42,439 Speaker 11: include wyre fraud, conspiracy to commit security fraud, and conspiracy 428 00:22:42,440 --> 00:22:46,240 Speaker 11: to commit money laundering. Among them, I'd say wireford is 429 00:22:46,280 --> 00:22:50,880 Speaker 11: the most serious that he faces, each attracting a maximum 430 00:22:50,920 --> 00:22:52,800 Speaker 11: penalty of twenty years in prison. 431 00:22:53,119 --> 00:22:55,359 Speaker 3: So he could spend a lot of time in prison 432 00:22:55,400 --> 00:22:59,199 Speaker 3: for this. If the prosecution is able to prove this right, 433 00:22:59,280 --> 00:23:02,040 Speaker 3: what do they needed to prove for him to be 434 00:23:02,080 --> 00:23:02,800 Speaker 3: found guilty. 435 00:23:03,040 --> 00:23:05,120 Speaker 11: One of the key elements they need to prove here 436 00:23:05,200 --> 00:23:08,439 Speaker 11: is intent. But Sam Banateman Freed set out to defraud 437 00:23:08,520 --> 00:23:12,720 Speaker 11: people to steal billions of dollars to co mingle customer funds, 438 00:23:12,840 --> 00:23:14,840 Speaker 11: and that he knew what he was doing was wrong. 439 00:23:15,160 --> 00:23:18,040 Speaker 11: This will be the biggest hurdle that they have to overcome. 440 00:23:18,520 --> 00:23:21,840 Speaker 11: Sam Bateman Freed will likely turn around and argue that 441 00:23:21,960 --> 00:23:24,040 Speaker 11: he didn't have that intent and that he acted in 442 00:23:24,080 --> 00:23:27,480 Speaker 11: good space and he didn't know that he was inadvertently 443 00:23:27,560 --> 00:23:29,080 Speaker 11: committing fraud. Yeah. 444 00:23:29,160 --> 00:23:32,800 Speaker 3: Remembering here that Sam Bankman Freed was someone who practiced 445 00:23:32,840 --> 00:23:36,160 Speaker 3: what we call effective altruism, or what he called effective altruism, 446 00:23:36,240 --> 00:23:38,600 Speaker 3: the idea that he wanted to do good with all 447 00:23:38,640 --> 00:23:41,000 Speaker 3: this money he had. And I wonder how that's going 448 00:23:41,080 --> 00:23:43,360 Speaker 3: to come up over the course of this trial. How 449 00:23:43,400 --> 00:23:45,920 Speaker 3: long do we expect this trial is going to last, 450 00:23:45,960 --> 00:23:48,080 Speaker 3: how long it's going to take his defense team to 451 00:23:48,080 --> 00:23:51,639 Speaker 3: make their case and for the prosecution to make theirs. 452 00:23:52,119 --> 00:23:56,359 Speaker 11: The trial is expected to last at around six weeks. 453 00:23:56,720 --> 00:24:00,200 Speaker 11: We heard that the prosecution's case could go from three 454 00:24:00,240 --> 00:24:03,000 Speaker 11: to four weeks and the defense will go for a 455 00:24:03,040 --> 00:24:05,359 Speaker 11: week to a week and a half. So we're looking 456 00:24:05,359 --> 00:24:07,560 Speaker 11: into a way into November. 457 00:24:08,600 --> 00:24:10,960 Speaker 3: And so when we think about what's going to happen, First, 458 00:24:11,000 --> 00:24:14,639 Speaker 3: as I said, this trial begins this coming Tuesday. What 459 00:24:14,880 --> 00:24:17,359 Speaker 3: happens on that day? How long is it going to 460 00:24:17,400 --> 00:24:21,119 Speaker 3: be before we start getting into the meaty part of 461 00:24:21,200 --> 00:24:22,040 Speaker 3: these proceedings. 462 00:24:23,359 --> 00:24:27,600 Speaker 11: The first day is set aside for a administrative process, 463 00:24:27,640 --> 00:24:30,280 Speaker 11: but a very important one. This is when the jury 464 00:24:30,320 --> 00:24:34,919 Speaker 11: will be impaneled. So a whole bunch of everyday New 465 00:24:35,000 --> 00:24:38,159 Speaker 11: Yorkers will come into a big room at the courthouse 466 00:24:38,480 --> 00:24:40,960 Speaker 11: em Lower Manhattan and they will go through the process 467 00:24:40,960 --> 00:24:44,159 Speaker 11: of being appointed to the jury. The prosecution and the 468 00:24:44,200 --> 00:24:48,200 Speaker 11: defense will have the opportunity to object to specific jurors 469 00:24:48,760 --> 00:24:50,919 Speaker 11: being as part of that trial. By the end of 470 00:24:50,920 --> 00:24:54,679 Speaker 11: the day, hopefully we will have a jury of twelve 471 00:24:54,680 --> 00:24:57,440 Speaker 11: men and women who are ready to get things started. 472 00:24:57,440 --> 00:25:00,360 Speaker 11: The following day, on the Wednesday, that's when and we'll 473 00:25:00,400 --> 00:25:04,400 Speaker 11: really see all of the duty details start to emerge. 474 00:25:04,480 --> 00:25:07,919 Speaker 11: That's when the prosecution will open their case and we 475 00:25:07,960 --> 00:25:12,200 Speaker 11: will hear the full extent of the allegations against Sam 476 00:25:12,200 --> 00:25:15,679 Speaker 11: Bateman Freed. The defense will also have an opportunity to 477 00:25:15,760 --> 00:25:16,840 Speaker 11: give an opening statement. 478 00:25:17,480 --> 00:25:20,040 Speaker 3: I'd like to return to your point about the idea 479 00:25:20,040 --> 00:25:23,960 Speaker 3: of selecting this jury. Given the high profile of this case, 480 00:25:24,000 --> 00:25:25,920 Speaker 3: we're talking about something that has been dubbed one of 481 00:25:25,960 --> 00:25:29,720 Speaker 3: the biggest financial fraud cases in history. You know, we 482 00:25:29,760 --> 00:25:31,720 Speaker 3: put this kind of in a basket at least in 483 00:25:31,760 --> 00:25:35,200 Speaker 3: common thought with and Ron or Birdy meat Off. How 484 00:25:35,240 --> 00:25:38,080 Speaker 3: hard is it going to be to select an unbiased jury? 485 00:25:40,000 --> 00:25:42,600 Speaker 11: That's a good question. We got a little bit of 486 00:25:42,640 --> 00:25:46,520 Speaker 11: an insight into the types of questions the defense and 487 00:25:46,560 --> 00:25:49,480 Speaker 11: the prosecutions want to ask this jury. For the defense, 488 00:25:49,680 --> 00:25:52,720 Speaker 11: they have asked the judge if the jury can be 489 00:25:52,760 --> 00:25:57,080 Speaker 11: asked certain questions about the crypto industry. Have they ever 490 00:25:57,400 --> 00:26:00,480 Speaker 11: invested in crypto? Have their friends or family been the 491 00:26:00,560 --> 00:26:04,439 Speaker 11: victims of a financial forward before? Do they think that 492 00:26:04,640 --> 00:26:08,440 Speaker 11: a person who is that the head of a company 493 00:26:08,480 --> 00:26:11,480 Speaker 11: should be held responsible if that company fails. There was 494 00:26:11,520 --> 00:26:14,520 Speaker 11: also a question in there about affect of altruism, what's 495 00:26:14,560 --> 00:26:16,760 Speaker 11: their views on a person a massing wealth? And then 496 00:26:16,800 --> 00:26:19,159 Speaker 11: giving that away, So that gives us a little bit 497 00:26:19,200 --> 00:26:22,680 Speaker 11: of an insight into the kind of jura that sat 498 00:26:22,720 --> 00:26:26,040 Speaker 11: Bankman Freed's defense may want to see as part of 499 00:26:26,040 --> 00:26:30,080 Speaker 11: that trial. On the prosecution side, the questions were a 500 00:26:30,080 --> 00:26:32,199 Speaker 11: lot more general. Have they been a victim of the 501 00:26:32,240 --> 00:26:34,840 Speaker 11: crime of a crime? Do they know anyone within the DOJ? 502 00:26:35,880 --> 00:26:39,840 Speaker 11: What are their views on crypto. So I think there's 503 00:26:39,840 --> 00:26:42,920 Speaker 11: been so much publicity about this case, it'll be hard 504 00:26:42,920 --> 00:26:45,359 Speaker 11: to pick someone who hasn't heard of Sam Bankman Freed. 505 00:26:46,400 --> 00:26:48,600 Speaker 11: The challenge will be really drilling down to see if 506 00:26:48,600 --> 00:26:51,880 Speaker 11: anyone has any very strong views that they can't put 507 00:26:51,920 --> 00:26:56,800 Speaker 11: aside on crypto or on fraud that won't allow them 508 00:26:56,840 --> 00:26:59,879 Speaker 11: to be able to carry out that exercise without bias. 509 00:27:00,520 --> 00:27:02,880 Speaker 3: Okay, So it might be a little tough to get 510 00:27:02,880 --> 00:27:05,240 Speaker 3: the jury together, But once it is, let's talk about 511 00:27:05,480 --> 00:27:07,320 Speaker 3: what they're going to hear and who they're going to 512 00:27:07,359 --> 00:27:11,960 Speaker 3: hear from. Talk to me about the witnesses in this case, 513 00:27:12,040 --> 00:27:14,160 Speaker 3: because I know that there's three really important ones, former 514 00:27:14,400 --> 00:27:18,159 Speaker 3: really close associate associates of Sam Bankman Fried, former executives 515 00:27:18,160 --> 00:27:22,720 Speaker 3: of FTX and Alameda related enterprises. Tell us why these 516 00:27:22,760 --> 00:27:23,920 Speaker 3: witnesses may be key. 517 00:27:25,760 --> 00:27:28,680 Speaker 11: They are really at the heart of the prosecution's case here, 518 00:27:28,720 --> 00:27:33,640 Speaker 11: and certainly who we are really looking forward to hearing from. 519 00:27:33,840 --> 00:27:37,480 Speaker 11: The three witnesses Caroline Ellison, who was, like you said, 520 00:27:37,480 --> 00:27:40,320 Speaker 11: the head of Alameda, Mishad Singh who was the director 521 00:27:40,359 --> 00:27:44,639 Speaker 11: of engineering at FTX, and Gary Wong, who was Bateman 522 00:27:44,720 --> 00:27:49,840 Speaker 11: Freed's high school friend and helped co found FTX. The 523 00:27:49,920 --> 00:27:52,800 Speaker 11: three of them together are going to give a very 524 00:27:52,840 --> 00:27:56,920 Speaker 11: powerful insight into what was happening at FTX, almost in 525 00:27:56,960 --> 00:28:01,440 Speaker 11: the foundation, but also in those final days before a 526 00:28:01,520 --> 00:28:05,600 Speaker 11: file for bankruptcy. For Nishad Sing and Gary Wong in particular, 527 00:28:05,680 --> 00:28:08,320 Speaker 11: they're going to speak about They're likely to speak about 528 00:28:08,320 --> 00:28:12,080 Speaker 11: the code at FTX, and that they were asked to 529 00:28:12,200 --> 00:28:15,840 Speaker 11: change the code to give Alameter a loophole essentially to 530 00:28:15,920 --> 00:28:20,639 Speaker 11: access customer funds whenever it wanted. Caroline Ellison is a 531 00:28:20,720 --> 00:28:24,480 Speaker 11: little bit different in that she was leading Alameda Research, 532 00:28:25,240 --> 00:28:27,919 Speaker 11: and one of the key allegations in this case is 533 00:28:27,960 --> 00:28:32,159 Speaker 11: that Sam Bateman free misled investors about their relationship between 534 00:28:32,240 --> 00:28:35,919 Speaker 11: FTX and Alameter, that Alimeda was using customer funds however 535 00:28:35,960 --> 00:28:39,760 Speaker 11: it wanted for Irish Trading for lowing two executives. So 536 00:28:39,800 --> 00:28:41,239 Speaker 11: she'll be able to give a little bit of an 537 00:28:41,240 --> 00:28:47,040 Speaker 11: insight into how that dynamic actually operated. The prosecutors have 538 00:28:47,080 --> 00:28:49,760 Speaker 11: said that they've got up to fifty potential witnesses that 539 00:28:49,800 --> 00:28:52,360 Speaker 11: they could call. Of course, it is highly unlikely that 540 00:28:52,360 --> 00:28:54,160 Speaker 11: they will call every single one of them, but we 541 00:28:54,200 --> 00:28:58,200 Speaker 11: think we're going to hear from other former employees, investor victims, 542 00:28:58,440 --> 00:29:02,560 Speaker 11: FBI agents, and some forensic accountants as well, who will 543 00:29:02,560 --> 00:29:08,320 Speaker 11: try to walk the jury through Alameda's financials, ftx's financials 544 00:29:08,360 --> 00:29:10,520 Speaker 11: to make it this case as simple as possible. 545 00:29:10,600 --> 00:29:12,840 Speaker 3: All right, Well, the eyes of Washington and probably a 546 00:29:12,880 --> 00:29:14,720 Speaker 3: lot of other places around the world will be on 547 00:29:14,800 --> 00:29:17,600 Speaker 3: New York for this trial beginning this coming week. Thank 548 00:29:17,640 --> 00:29:20,760 Speaker 3: you very much to Bloomberg Legal reporter Eva, Benni Morrison, 549 00:29:20,760 --> 00:29:22,280 Speaker 3: and Tom. We'll send it back to you. 550 00:29:22,400 --> 00:29:25,040 Speaker 1: Thank you, Kaylee. That was Bloomberg's sound on co host 551 00:29:25,120 --> 00:29:27,719 Speaker 1: Kaylee Lines, reporting from our Bloomberg ninety nine to one 552 00:29:27,760 --> 00:29:31,520 Speaker 1: newsroom in Washington, and you can hear sound on weekdays 553 00:29:31,560 --> 00:29:34,840 Speaker 1: one to three pm on Bloomberg Radio. Coming up here 554 00:29:34,880 --> 00:29:37,640 Speaker 1: on Bloomberg day Break weekend, we head to Australia and 555 00:29:37,800 --> 00:29:42,040 Speaker 1: preview what we can expect from the RBA. This is Bloomberg. 556 00:29:52,000 --> 00:29:54,520 Speaker 1: This is Bloomberg day Break Weekend, ourk lobal look ahead 557 00:29:54,520 --> 00:29:56,600 Speaker 1: at the top stories for investors in the coming week. 558 00:29:57,080 --> 00:30:01,120 Speaker 1: I'm Tom Busby in New York. Australia's monthly inflation gauge 559 00:30:01,160 --> 00:30:03,719 Speaker 1: accelerated in August, So what do we expect from the 560 00:30:03,760 --> 00:30:07,400 Speaker 1: new Reserve Bank of Australia Bank governor at her first 561 00:30:07,480 --> 00:30:10,280 Speaker 1: board meeting next week. For more, let's go to Bloomberg 562 00:30:10,360 --> 00:30:13,400 Speaker 1: Daybreak Asia anchor Doug Krisner, Tom. 563 00:30:13,080 --> 00:30:13,920 Speaker 6: And the week ahead. 564 00:30:14,160 --> 00:30:17,440 Speaker 4: The new Governor of the Reserve Bank of Australia, Michelle Bullock, 565 00:30:17,520 --> 00:30:20,600 Speaker 4: will lead her first meeting of the Central Bank. Bullock, 566 00:30:20,680 --> 00:30:22,560 Speaker 4: by the way, is the first woman to serve as 567 00:30:22,600 --> 00:30:25,240 Speaker 4: governor of the RBA. She was appointed back in July, 568 00:30:25,880 --> 00:30:29,400 Speaker 4: and like many central bankers around the world, Bullock is 569 00:30:29,440 --> 00:30:32,920 Speaker 4: being confronted with stubbornly high inflation. For a closer look 570 00:30:32,920 --> 00:30:36,400 Speaker 4: now at the RBA decision, I'm joined by James McIntyre, 571 00:30:36,400 --> 00:30:40,719 Speaker 4: Bloomberg's economist covering Australia and New Zealand. James joins us 572 00:30:40,720 --> 00:30:43,960 Speaker 4: from our studios in Sydney. Thanks for being with us, James. 573 00:30:44,120 --> 00:30:46,440 Speaker 4: Before we get to the story on inflation, I want 574 00:30:46,440 --> 00:30:49,080 Speaker 4: to try to apply a little context here, because Bullock 575 00:30:49,160 --> 00:30:52,240 Speaker 4: is taking over from Phil Lowe. Now, he had been 576 00:30:52,280 --> 00:30:56,200 Speaker 4: facing calls to resign in recent months. Before his departure, 577 00:30:56,240 --> 00:30:59,640 Speaker 4: he had been condemned by the public and accused of 578 00:30:59,640 --> 00:31:03,960 Speaker 4: missus leading Australians about future rate increases. Now I know 579 00:31:04,080 --> 00:31:06,640 Speaker 4: Bullock was at the RBA when those decisions were made. 580 00:31:06,640 --> 00:31:10,960 Speaker 4: But I'm wondering whether restoring credibility is kind of job one. 581 00:31:11,360 --> 00:31:13,800 Speaker 12: Well, that's a really good point. Not only was Bullock 582 00:31:13,800 --> 00:31:16,520 Speaker 12: at the RBA, but she was actually as Deputy governor, 583 00:31:16,720 --> 00:31:18,960 Speaker 12: was at the board meetings, was at those meetings when 584 00:31:19,000 --> 00:31:22,200 Speaker 12: those decisions were made, not only to raise rates as 585 00:31:22,240 --> 00:31:26,240 Speaker 12: they've done in the fastest height tightening cycle in the 586 00:31:26,280 --> 00:31:29,360 Speaker 12: inflation targeting era. So the RBA has been targeting inflation 587 00:31:29,520 --> 00:31:33,120 Speaker 12: since the nineteen nineties more than thirty years now. So 588 00:31:33,240 --> 00:31:36,080 Speaker 12: not only was she there for those rate hype decisions, 589 00:31:36,120 --> 00:31:39,720 Speaker 12: but also part of the decision making around that communication 590 00:31:39,960 --> 00:31:44,160 Speaker 12: that ended up tripping up pil Low. Now, it's been 591 00:31:44,160 --> 00:31:46,320 Speaker 12: tough going the last couple of years for central bankers, 592 00:31:46,360 --> 00:31:48,320 Speaker 12: and if you think that your economy might be locked 593 00:31:48,400 --> 00:31:52,240 Speaker 12: up for three years, you know, you could make an 594 00:31:52,280 --> 00:31:54,320 Speaker 12: a credible case that that was going to be the 595 00:31:55,360 --> 00:31:58,920 Speaker 12: where policy might go. But then as the situation changed, 596 00:31:58,960 --> 00:32:01,960 Speaker 12: I think fill those a bit tonity make that communication 597 00:32:02,160 --> 00:32:06,000 Speaker 12: change obviously didn't didn't flow or didn't flow in a 598 00:32:06,040 --> 00:32:09,080 Speaker 12: way that people like who really does like interest rates rising, 599 00:32:09,320 --> 00:32:11,320 Speaker 12: especially on their home loans. The way they work here 600 00:32:11,320 --> 00:32:15,000 Speaker 12: in Australia, so that's been what happened to Low and 601 00:32:15,040 --> 00:32:18,440 Speaker 12: it's also the challenge, it's not the only challenge that 602 00:32:19,120 --> 00:32:22,920 Speaker 12: Governor Bullock faces over her term, which lasts for seven years. 603 00:32:22,960 --> 00:32:26,080 Speaker 12: So her first board meeting this coming week, she will 604 00:32:26,080 --> 00:32:30,200 Speaker 12: be implementing these reforms to the RBA, including this new 605 00:32:30,520 --> 00:32:37,000 Speaker 12: Monetary Policy Committee staffed by external monetary policy experts. That's 606 00:32:37,000 --> 00:32:39,240 Speaker 12: something that the RBA hasn't had to deal with before. 607 00:32:39,320 --> 00:32:44,160 Speaker 12: So it's not just a credibility restoration communication challenge for 608 00:32:44,200 --> 00:32:47,840 Speaker 12: Governor Bullock. But as the review rolls in and as 609 00:32:47,840 --> 00:32:50,920 Speaker 12: a term rolls on, communication I think is going to 610 00:32:50,920 --> 00:32:53,840 Speaker 12: be the theme for her home in the chair. 611 00:32:53,960 --> 00:32:56,400 Speaker 4: Well let's take a quick look at the overhaul as 612 00:32:56,440 --> 00:32:58,520 Speaker 4: a result of that government review. What are some of 613 00:32:58,520 --> 00:33:01,080 Speaker 4: the major changes she must implement. 614 00:33:01,320 --> 00:33:03,960 Speaker 12: Well, I guess one of the changes is she'll have 615 00:33:04,040 --> 00:33:06,880 Speaker 12: less to do. Rather than monthly meetings eleven of them 616 00:33:06,880 --> 00:33:08,680 Speaker 12: a year, which the RBA used to do, they'll be 617 00:33:08,720 --> 00:33:12,120 Speaker 12: moving to eight. And that's pretty consistent with other central 618 00:33:12,160 --> 00:33:15,520 Speaker 12: banks around the world. You know, the RBA did like 619 00:33:15,600 --> 00:33:19,040 Speaker 12: to have the opportunity to communicate month to month and 620 00:33:19,080 --> 00:33:21,560 Speaker 12: do things a bit more gradually, so that step change. 621 00:33:21,640 --> 00:33:25,000 Speaker 12: That's a communication challenge as to how to nuance what 622 00:33:25,120 --> 00:33:30,800 Speaker 12: might be slightly more lurching changes in communication, in policy direction, 623 00:33:31,360 --> 00:33:34,520 Speaker 12: press conferences after every meeting, that's going to be something 624 00:33:34,960 --> 00:33:36,960 Speaker 12: that will be a little bit different, and we'll get 625 00:33:36,960 --> 00:33:40,080 Speaker 12: to see how Buller candles those. But also this new 626 00:33:40,120 --> 00:33:45,120 Speaker 12: Monetary Policy Committee, the experts or the external appointees, they're 627 00:33:45,200 --> 00:33:49,120 Speaker 12: expected to be out there communicating about monetary policy to 628 00:33:49,920 --> 00:33:53,480 Speaker 12: the community at large and so having a whole range 629 00:33:53,520 --> 00:33:56,960 Speaker 12: of different voices, whereas up until now the RBA has 630 00:33:57,040 --> 00:34:00,840 Speaker 12: been had a monopoly on monetary policy and explaining it 631 00:34:00,880 --> 00:34:01,960 Speaker 12: and explaining the direction. 632 00:34:02,160 --> 00:34:04,280 Speaker 4: James, thank you so much for helping us set up 633 00:34:04,280 --> 00:34:08,480 Speaker 4: the RBA meeting. James McIntyre Bloomberg's economist covering Australia and 634 00:34:08,800 --> 00:34:11,960 Speaker 4: New Zealand. I'm Doug Prisner. You can join Brian Curtison 635 00:34:12,000 --> 00:34:15,080 Speaker 4: myself weekdays here for Bloomberg Daybreak Asia, beginning at six 636 00:34:15,160 --> 00:34:18,160 Speaker 4: am in Hong Kong six pm on Wall Street. 637 00:34:18,440 --> 00:34:20,560 Speaker 1: Tom Well, thank you, Doug, and that does it for 638 00:34:20,600 --> 00:34:23,080 Speaker 1: this edition of Bloomberg day Break Weekend. Join us again 639 00:34:23,200 --> 00:34:25,720 Speaker 1: Monday morning, five am Wall Street time for the latest 640 00:34:25,719 --> 00:34:28,479 Speaker 1: on markets overseas, and the news you need to start 641 00:34:28,520 --> 00:34:31,920 Speaker 1: your day. I'm Tom Buzby. Stay with US. Top stories 642 00:34:31,920 --> 00:34:35,800 Speaker 1: and global business headlines are coming up right now.