WEBVTT - Bloomberg Daybreak: October 21, 2022 - Hour 2 (Radio) 0:00:01.560 --> 0:00:04.840 Life from the Bloomberg Interactive Broker Studios. This is Bloomberg 0:00:04.880 --> 0:00:08.280 day Break for Friday, October twenty one two. Coming up 0:00:08.320 --> 0:00:12.160 this hour, UK leaders consider what's next after the resignation 0:00:12.240 --> 0:00:15.000 of Liz Trust. Stocks look to snap a two day 0:00:15.040 --> 0:00:17.760 losing streak to close out the week. The US Ways 0:00:17.840 --> 0:00:21.880 expanding its technology ban on China, and Elon Musk reportedly 0:00:21.960 --> 0:00:25.440 plans massive job cuts at Twitter. It's a tragic end 0:00:25.560 --> 0:00:28.760 to the search for missing Princeton University student. Plus it's 0:00:28.800 --> 0:00:31.920 sentencing day for Trump Alloy Steve men in for contempt 0:00:32.320 --> 0:00:35.160 Michael Barr. More ahead, I'm trying stage shower and sports. 0:00:35.200 --> 0:00:37.839 The Yankees lost again in Houston Trail. The ALC has 0:00:37.920 --> 0:00:40.600 to nothing, The Rangers lost, Devils beat the Islanders, a 0:00:40.640 --> 0:00:45.800 big trade in the NFL. That's all training ahead on 0:00:45.920 --> 0:00:49.320 Bloomberg day Break on Bloomberg eleven, Free on New York, 0:00:49.479 --> 0:00:53.199 Bloomberg ninety nine one, Washington, d C, Bloomberg one O 0:00:53.280 --> 0:00:58.120 six one, Boston, Bloomberg nine sixties and Francisco Sirius XM 0:00:58.160 --> 0:01:01.240 one nine team and around the world on Bloomberg Radio 0:01:01.320 --> 0:01:08.399 dot Com and via The Bloomberg Business. Good Friday morning, 0:01:08.480 --> 0:01:11.680 I'm Karen Moscow. I'm Nathan Hagar. Bloomberg. Daybreak is brought 0:01:11.680 --> 0:01:14.679 to you by SEI. Asset managers don't get results that 0:01:14.680 --> 0:01:17.039 are off the charts when their solutions are off the shelf. 0:01:17.280 --> 0:01:20.400 Learn how SEI is operating platform can turn infrastructure into 0:01:20.440 --> 0:01:24.199 a competitive advantage at se I, C, dot Com, slash Tech, 0:01:24.680 --> 0:01:27.600 and US dot Index. Futures are lower this morning, so 0:01:27.640 --> 0:01:29.679 one on Wall Street. We check the markets every fifteen 0:01:29.680 --> 0:01:32.000 minutes throughout the trading day on Bloomberg S and P 0:01:32.160 --> 0:01:34.960 futures down twenty points down, futures down a hundred sixteen, 0:01:35.240 --> 0:01:38.280 Nasdack futures down in nineties three. Nathan, Karen. We'll get 0:01:38.280 --> 0:01:40.560 born markets in a moment, but we begin this morning 0:01:40.560 --> 0:01:43.440 in the UK, where government leaders are weighing next steps 0:01:43.480 --> 0:01:47.080 following the resignation of Prime Minister Liz Trust. Bloomberg's You 0:01:47.160 --> 0:01:49.080 and Potts has the very latest from London. You and 0:01:49.120 --> 0:01:52.040 good morning, Good morning, Nathan and Karen. Political news moves 0:01:52.080 --> 0:01:54.520 fast in Britain at the moment. By next Friday, the 0:01:54.560 --> 0:01:57.080 country will have a fifth prime minister in less than 0:01:57.160 --> 0:01:59.920 seven years. The Consufti party. He will choose a new 0:02:00.160 --> 0:02:03.559 leader after Liz Trust quit becoming the shortest ever serving 0:02:03.600 --> 0:02:07.040 prime minister in the history. Plans are very short contest. 0:02:07.400 --> 0:02:09.520 If lawmakers make a clear choice, we could find out 0:02:09.639 --> 0:02:12.960 as soon as Monday. Former chance that Ritchie Snak is 0:02:12.960 --> 0:02:16.200 the current favorite with bookmakers, the gods on the second 0:02:16.200 --> 0:02:19.400 favorite candidate have shortened considerably in the past few hours. 0:02:19.639 --> 0:02:23.320 That candidate is former Prime Minister Boris Johnson. In London, 0:02:23.360 --> 0:02:26.400 Immune parts Limberg, Debreak and thanks that. We continue to 0:02:26.440 --> 0:02:29.919 hear from current and former leaders weighing in on UK politics. 0:02:29.919 --> 0:02:32.880 Former Tory leader Michael Howard spoke to Bloomberg about the 0:02:32.919 --> 0:02:35.959 future of the Conservative Party the next twelve months, so 0:02:36.040 --> 0:02:38.639 I'm doubtedly going to be very difficult and very thankful. 0:02:38.880 --> 0:02:41.919 But after that, I think there's every reason to suppose 0:02:41.960 --> 0:02:45.040 that inflation will be coming down, mortgage interest rates will 0:02:45.120 --> 0:02:47.519 be coming down, and the Prime Minister will be able 0:02:47.520 --> 0:02:49.640 to say we've been to a very top time, that 0:02:49.680 --> 0:02:52.360 we've taken the right decisions and now we're seeing the 0:02:52.400 --> 0:02:55.480 fruits of those decisions. So don't take any risks and 0:02:55.600 --> 0:02:59.120 don't that label ruin it. Former Tory leader Michael Howard says, 0:02:59.160 --> 0:03:01.920 you supporter of Rishi Suna to be the new prime minister. 0:03:02.080 --> 0:03:05.920 He also believes that Jeremy Hunt remained Chancellor. Trust resigned 0:03:06.040 --> 0:03:08.760 after forty four days, making her premiership the shortest in 0:03:08.880 --> 0:03:12.600 UK history. Staying overseas, Karen Let's turn to China, tensions 0:03:12.720 --> 0:03:16.240 between Beijing and Washington remaining focus now. The White House 0:03:16.320 --> 0:03:19.440 is weighing a further technology ban on China to include 0:03:19.480 --> 0:03:23.560 quantum computing and artificial intelligence. Sploomberg's John Lou reports from 0:03:23.560 --> 0:03:27.200 Beijing the Biden administration taking as many steps as possible 0:03:27.240 --> 0:03:31.120 to try to limit China's access to these emerging technologies. 0:03:31.240 --> 0:03:35.800 Quantum computing is still sort of an experimental field, but 0:03:35.880 --> 0:03:39.520 the implications for the future, how greatly this technology could 0:03:39.520 --> 0:03:43.520 affect the future, I think makes it an important point 0:03:43.560 --> 0:03:46.640 to for the Biden administration to focus on now. Bloomberg's 0:03:46.720 --> 0:03:48.840 John lu says it's just the latest of many signs 0:03:48.880 --> 0:03:52.200 the White House is taking a harder line on China. Meantime, 0:03:52.280 --> 0:03:55.640 US Secretary of State Anthony Blankolin says relations with Beijing 0:03:55.720 --> 0:03:58.800 are at an inflection point, and he's building an international 0:03:58.800 --> 0:04:01.960 coalition to stand up a against China. Bloomberg said, Baxter 0:04:02.080 --> 0:04:05.400 has that story. Lincoln says the key is starting with Taiwan. 0:04:05.520 --> 0:04:07.600 The entire world has a stake in this and making 0:04:07.640 --> 0:04:10.560 sure that there is peace and stability and along the 0:04:10.560 --> 0:04:13.920 Taiwan Straight. The amount of trade and commerce that goes 0:04:13.960 --> 0:04:17.000 to that straight every day is essential to the world. 0:04:17.040 --> 0:04:19.640 Economist b. Lincoln says the US is not looking for 0:04:19.720 --> 0:04:23.240 conflict with China, but the China must understand that freedom 0:04:23.240 --> 0:04:26.000 of commerce with Taiwan as a matter of survival for 0:04:26.040 --> 0:04:29.560 the global community as a whole. In San Francisco, I'm 0:04:29.560 --> 0:04:32.200 at Baxter Bloomberg daybreak. All right, and thank you. Let's 0:04:32.200 --> 0:04:34.479 take a look back at markets now. Futures are in 0:04:34.520 --> 0:04:36.480 the red as Wall Street looks to reverse a two 0:04:36.520 --> 0:04:39.960 day slamp. Morgan Stanley chief equity strategist Mike Wilson thinks 0:04:39.960 --> 0:04:42.440 stocks may not have bottomed, but there is light at 0:04:42.440 --> 0:04:45.080 the end of the tunnel. The kind of final chapter 0:04:45.320 --> 0:04:48.760 to this bear market probably will be fast as well. 0:04:49.040 --> 0:04:51.279 If we had this conversation three months ago and we 0:04:51.360 --> 0:04:54.040 probably hit I thought we could have this all wrapped 0:04:54.120 --> 0:04:57.039 up by Thanksgiving and maybe have a nice ending to 0:04:57.080 --> 0:05:00.880 the holiday period and say, okay, we can move forward. Unfortunately, 0:05:00.960 --> 0:05:03.360 I think it may you know, linger into next year. 0:05:03.640 --> 0:05:06.279 Morgan Stanley's Mike Wilson says we could see a reckoning 0:05:06.320 --> 0:05:09.279 of disappointing earnings in the next quarter. Speaking of earning 0:05:09.279 --> 0:05:11.640 to Nathan, we're seeing shares a Snap tumble after a 0:05:11.680 --> 0:05:14.960 slatest results. They're down twenty six after reporting the company 0:05:15.000 --> 0:05:18.880 slowest quarterly sales growth ever. Bloomberry Shirlie Pellett has the story. 0:05:19.240 --> 0:05:22.159 The maker of the Snapchat app said third quarter sales 0:05:22.200 --> 0:05:25.480 increase six percent to one point one three billion dollars. 0:05:25.480 --> 0:05:28.400 That was just shy of analyst savage estimate of one 0:05:28.400 --> 0:05:32.040 point one four billion dollars. The social media company spent 0:05:32.080 --> 0:05:36.360 the quarter shrinking and refocusing its business, announcing in August 0:05:36.360 --> 0:05:39.560 that it was cutting twenty of its workforce and slashing 0:05:39.600 --> 0:05:43.680 projects that don't contribute to user or revenue growth or 0:05:43.720 --> 0:05:47.760 to the company's augmented reality efforts in New York. Charlie 0:05:47.800 --> 0:05:50.560 Pellett Bloomberg Daybreak. All right, Charlie, thank you. We also 0:05:50.560 --> 0:05:53.400 have a number of headlines on Twitter this morning. Advisors 0:05:53.480 --> 0:05:56.120 on both sides are looking to close Elon Musk's deal 0:05:56.200 --> 0:05:57.640 to buy the company by the end of the month. 0:05:58.000 --> 0:06:00.240 At the same time, Twitter is telling staff there will 0:06:00.279 --> 0:06:03.720 not be widespread layoffs. That's after reports Musk wants to 0:06:03.760 --> 0:06:08.039 slash seventy five percent of Twitter's workforce. Kurt Wagner covers 0:06:08.040 --> 0:06:10.800 the company for Bloomberg News. They're definitely going to be 0:06:10.960 --> 0:06:12.840 cost cuts at Twitter. I think we all know that 0:06:12.920 --> 0:06:16.120 layoffs are are widely expected. I do wonder if this 0:06:16.200 --> 0:06:18.680 is a little extreme, right. What we've seen from Elon 0:06:18.760 --> 0:06:20.480 in the past is that a lot of his estimates 0:06:20.520 --> 0:06:23.280 have been pretty extreme in terms of what he thinks 0:06:23.279 --> 0:06:25.360 for revenue or user growth, and that could be going 0:06:25.400 --> 0:06:28.360 extreme in the other direction to with costcut. Bloomberg's Kurt 0:06:28.360 --> 0:06:30.640 Wagner says the number of layoffs that Twitter may not 0:06:30.680 --> 0:06:33.960 reach seventy pcent, but could still exceed other predictions. If 0:06:34.000 --> 0:06:36.520 all that wasn't enough. Elon Musk is also coming under 0:06:36.560 --> 0:06:39.800 scrutiny from the Biden administration. Sources tell US White House 0:06:39.839 --> 0:06:42.520 officials are discussing whether the U S should subject some 0:06:42.600 --> 0:06:45.920 of the Musk ventures to national security reviews, including the 0:06:45.960 --> 0:06:49.880 Twitter deal and his space X Starlink satellite network, which 0:06:49.920 --> 0:06:52.400 told officials have grown uncomfortable with what they see as 0:06:52.680 --> 0:06:56.159 Musk's increasingly rush a friendly comments. Taking a look at Twitter, 0:06:56.160 --> 0:06:58.880 shares right now, they are lower by seven point seven percent. 0:06:59.000 --> 0:07:02.400 In the pre market, SMP futures are lower by seventeen 0:07:02.440 --> 0:07:05.239 points down, futures down ninety eight. Nastac features are lower 0:07:05.560 --> 0:07:08.679 by eighty seven points. Ten year treasuries down nine thirty 0:07:08.720 --> 0:07:11.320 seconds now the yield four point to six percent. The 0:07:11.400 --> 0:07:14.520 yield on the two year four point five nine percent. 0:07:15.000 --> 0:07:17.720 Straight ahead your latest local headlines in the check of sports. 0:07:17.760 --> 0:07:24.600 This is Bloomberg and it sounds six so seven. On 0:07:24.640 --> 0:07:27.320 Wall Street. We are at forty seven degrees in Central Park. 0:07:27.360 --> 0:07:29.600 Got an accident on the southbound West Side Highway at 0:07:29.640 --> 0:07:32.720 seventy nine. Details coming up in traffic. First Michael Barr 0:07:32.840 --> 0:07:34.240 with more on what's going on in New York and 0:07:34.280 --> 0:07:36.640 around the world. Good morning, Michael, Good morning Nathan. A 0:07:36.720 --> 0:07:40.080 tragic into the case of a missing Princeton University student. 0:07:40.600 --> 0:07:44.560 Missing student twenty year old Miss rock Unity was found 0:07:44.560 --> 0:07:48.000 dead behind some tennis courts on campus. She hadn't been 0:07:48.000 --> 0:07:51.440 seen since last Friday, prompting her friends to report her 0:07:51.440 --> 0:07:54.960 missing to police. Police stay at grounds employee found her 0:07:54.960 --> 0:07:57.760 body with no obvious signs of injury, adding her depth 0:07:58.200 --> 0:08:02.160 does not appear suspicious or menal in nature. Thousands are 0:08:02.200 --> 0:08:05.320 expected today at the funerals for two Bristol, Connecticut police 0:08:05.320 --> 0:08:09.040 officers killed in an ambush last week. Officers from across 0:08:09.080 --> 0:08:12.600 the US and in Canada are expected to attend services 0:08:12.600 --> 0:08:17.200 for Sergeant Dustin damnty An officer Alex Hemsey. Services start 0:08:17.280 --> 0:08:20.480 at eleven AM. Less than three weeks to the mid terms, 0:08:20.560 --> 0:08:23.880 President Biden paid a visit to Pennsylvania. In Pittsburgh, he 0:08:23.960 --> 0:08:28.080 greeted Democratic Senate candidate John Fetterman, predicting that he's going 0:08:28.120 --> 0:08:31.560 to win. Fetterman, Pennsylvania's lieutenant governor, is locked in a 0:08:31.680 --> 0:08:35.720 tight race with Republican doctor Memiaz. President Biden spoke at 0:08:35.720 --> 0:08:38.959 the side of a bridge that collapsed back in January. 0:08:39.360 --> 0:08:42.720 By the grace of God, the school was delayed that 0:08:42.840 --> 0:08:46.080 day because of snow, and it was just before rush hour, 0:08:46.559 --> 0:08:49.720 so there was less traffic than usual. It had been 0:08:49.760 --> 0:08:52.640 a normal had been a normal day, it would have 0:08:52.679 --> 0:08:56.000 been much, much worse. The bridge is now the side 0:08:56.000 --> 0:09:00.320 of an Infrastructure Package funded reconstruction project. The HA got 0:09:00.360 --> 0:09:03.400 pushed back on Russia's denials that it is using Iranian 0:09:03.400 --> 0:09:07.480 made drones to attack civilian targets in Ukraine. State Department 0:09:07.480 --> 0:09:10.720 smoke has been ned price. We can confirm that Russian 0:09:10.760 --> 0:09:14.880 military personnel based in Primia have been piloted piloting piloting 0:09:14.960 --> 0:09:17.760 excuse me, Iranian ua v s and using them to 0:09:17.840 --> 0:09:23.360 conducts kinetic strikes across Ukraine, including in strikes against Kievan 0:09:23.559 --> 0:09:26.479 in recent days. The European Union has an ounce sentions 0:09:26.559 --> 0:09:30.160 on an Iranian aerospace company. Steve Bannon is scheduled to 0:09:30.160 --> 0:09:32.880 be sentenced today for a contempt of Congress were refusing 0:09:32.920 --> 0:09:35.640 to comply with the subpoena issued by the House Select 0:09:35.679 --> 0:09:39.120 Committee investigating the January sixth attack on the U S Capitol. 0:09:39.600 --> 0:09:41.800 Bannon could face up to two years in prison, but 0:09:41.840 --> 0:09:45.000 the Department of Justice is recommending a lesser sentence of 0:09:45.040 --> 0:09:48.360 six months and a two hundred thousand dollar fine. Global 0:09:48.400 --> 0:09:50.840 News twenty four hours a day on air and on 0:09:50.880 --> 0:09:54.600 Bloomberg Quicktake, powered by more than twenty seven hundred journalists 0:09:54.600 --> 0:09:57.360 analysts more than a hundred twenty countries. Michael Barr and 0:09:57.440 --> 0:10:04.840 this is Bloomberg, Nathan, Thank you, Michael six o nine 0:10:04.840 --> 0:10:06.880 on Wall Street Time for the Bloomberg Sports Update, brought 0:10:06.880 --> 0:10:08.960 to you by Fry State out He with John Stash. 0:10:09.120 --> 0:10:11.599 All Right, Nathan to a LCS games and used in 0:10:11.679 --> 0:10:14.000 the Yankees and the opener had only five hits struck 0:10:14.040 --> 0:10:18.360 out seventeen times. Game two, four hits struck out thirteen times. 0:10:18.400 --> 0:10:21.160 Yankee pitching in defense with solid but done in by 0:10:21.200 --> 0:10:24.880 one Astros swinging the bat, third set just about the 0:10:24.920 --> 0:10:30.800 belt and the one too swinging at three pointer put 0:10:30.840 --> 0:10:41.240 way down town. That's Alex Bradley with the long ball. 0:10:41.320 --> 0:10:44.079 It's three nothing. I mean they call Yanks scorch twice 0:10:44.120 --> 0:10:46.920 and the fourth thought Framber Valdez do mostly the Valdez 0:10:46.960 --> 0:10:49.720 committing two errors on the same play. No story after that. 0:10:49.800 --> 0:10:52.080 Houston won three to two, light the opener. Yanks at 0:10:52.080 --> 0:10:54.160 the time run on ninth to name and Matt Carpenter 0:10:54.640 --> 0:10:56.920 struck out as he has in all seven of his 0:10:56.960 --> 0:10:59.920 postseason at bath. Game three tomorrow at the Stadium at 0:10:59.920 --> 0:11:01.640 the Garden Rangers at a two one lay, but lost 0:11:01.640 --> 0:11:04.400 in overtime to San Jose three to Eric Carlson scored 0:11:04.679 --> 0:11:06.840 for the Sharks opening minute of ot the New Devil 0:11:06.880 --> 0:11:09.520 Andre Polote score twice. New Jersey beat the Islanders four 0:11:09.559 --> 0:11:12.560 to one. The Knicks homeopeners tonight against Detroit. The nets 0:11:12.600 --> 0:11:16.280 Hos Toronto Arizona Cardinals twenty two points to a span 0:11:16.360 --> 0:11:19.480 of less than two minutes late second quarterback to back 0:11:19.520 --> 0:11:22.760 pick sixes partners beat the SATs forty two to thirty four, 0:11:22.920 --> 0:11:25.240 Jets and Giants, both riding three game winning streaks, and 0:11:25.280 --> 0:11:28.840 on Sunday facing two and four teams Denver and Jacksonville 0:11:29.160 --> 0:11:31.280 forty Niners with a big pick up late last night, 0:11:31.320 --> 0:11:33.760 they traded four draft picks, none of them first rounders, 0:11:33.800 --> 0:11:37.360 to Carolina for Christian McCaffrey, who, with his last full 0:11:37.400 --> 0:11:40.760 healthy season two thousand nineteen, had over a thousand yards 0:11:40.840 --> 0:11:45.200 rushing and receiving. John Stashward, Bloomberg Sports, Nathan Thanks John 0:11:45.280 --> 0:11:47.839 SMP futures down twenty one points down, Futures down a 0:11:47.880 --> 0:11:50.320 hundred eighteen, nest At futures down a hundred one points. 0:11:50.320 --> 0:11:52.959 Twitter shares down eight point four percent in the pre 0:11:53.080 --> 0:11:57.240 market on reports of potential widespread job cuts and new 0:11:57.400 --> 0:12:00.920 scrutiny of Elon Musks deal. We'll talk about it all 0:12:00.960 --> 0:12:04.560 next with Bloomberg Quick Takes Alex Web. This is Bloomberg. 0:12:07.320 --> 0:12:09.520 Bloomberg Sports Report was brought to you by Outing. Don't 0:12:09.559 --> 0:12:11.439 let someone else drive off in the autie model you've 0:12:11.480 --> 0:12:14.079 always wanted. Visit your local tri state autie dealer to 0:12:14.120 --> 0:12:16.439 get behind the wheel of yours today, or visit autie 0:12:16.520 --> 0:12:23.880 Offers dot com for more information, markets, headlines and breaking 0:12:23.880 --> 0:12:26.800 news twenty four hours a day at Bloomberg dot Com, 0:12:26.880 --> 0:12:30.439 the Bloomberg Business Out and at Bloomberg Quick Tape, He's 0:12:30.480 --> 0:12:39.719 a Bloomberg Business lash and I'm kared. Moscow stocks are 0:12:39.800 --> 0:12:42.960 dropping as treasury yields continue to climb, with traders betting 0:12:42.960 --> 0:12:45.199 the Federal Reserve but keep raising interest rates and his 0:12:45.320 --> 0:12:48.080 investors assess the latest earnings reports, and we check the 0:12:48.120 --> 0:12:51.319 markets every fifteen minutes throughout the trading day. On Bloomberg 0:12:51.360 --> 0:12:53.760 Guess and p Future is down to twenty four points down, 0:12:53.800 --> 0:12:57.360 futures down a hundred thirties seven nasdack futures down one seven, 0:12:57.360 --> 0:12:59.640 the decks in Germany's down one and a half percent, 0:13:00.000 --> 0:13:02.559 ten year treasury down eleven thirty seconds four point to 0:13:02.720 --> 0:13:05.199 seven percent, and the yielding the two year four point 0:13:05.240 --> 0:13:08.720 five nine percent. Nine max Screwed oil is down four 0:13:08.800 --> 0:13:10.679 tenths per cent, or thirty three cents at eighty four 0:13:10.720 --> 0:13:13.360 dollars eighteen cents A barrel call makes good down half 0:13:13.400 --> 0:13:17.160 percent or eight dollars seventy cents at sixty announced, the 0:13:17.240 --> 0:13:20.440 euro point nine five against the dollar British found one 0:13:20.480 --> 0:13:24.240 point one three and the yen one fifty point nine eight. 0:13:24.400 --> 0:13:27.240 Looking at Bitcoin down three tenths percent at eighteen thousand, 0:13:27.320 --> 0:13:30.320 nine hundred fifty dollars. That's a Bloomberg business flash. Now 0:13:30.400 --> 0:13:32.720 here's Michael Barr with more on what's going on around 0:13:32.760 --> 0:13:35.160 the world. Michael, thank you very much, Karen. Now that 0:13:35.280 --> 0:13:38.120 Liz Trust is out of ten Downing Street, another leadership 0:13:38.240 --> 0:13:41.320 vote has been triggered to decide Britain's new prime minister. 0:13:41.760 --> 0:13:45.559 Favorites include former Treasury chief Rieshi Sunac and House of 0:13:45.640 --> 0:13:49.320 Commons leader Penny more dont The wild card is former 0:13:49.440 --> 0:13:52.600 Prime Minister Boris Johnson, who was forced to resign by 0:13:52.640 --> 0:13:55.760 the party just over three months ago amid ethics scandals. 0:13:56.200 --> 0:13:58.880 In baseball, the Yankees are down two games to zip 0:13:58.920 --> 0:14:02.200 against the Astros in the a l CS. New York 0:14:02.320 --> 0:14:05.800 lost last night to Houston three two. In the NHL, 0:14:05.960 --> 0:14:08.520 the Devils beat the Islanders for one. The Rangers and 0:14:08.600 --> 0:14:11.640 Capitals lost the Bruins one. In the NFL all the 0:14:11.720 --> 0:14:15.400 Cardinals beat the Saints and Thursday Night Football for four 0:14:15.720 --> 0:14:19.520 and a huge trade. The Panthers created running back Christian 0:14:19.600 --> 0:14:22.800 McCaffrey to the forty Niners in exchange for draft picks. 0:14:23.200 --> 0:14:25.920 Global News twenty four hours a day on air and 0:14:26.200 --> 0:14:29.640 on Bloomberg Quick Take, powered by more than seven hundred 0:14:29.680 --> 0:14:32.480 journalists and analysts and more than a hundred twenty countries. 0:14:32.520 --> 0:14:36.600 I'm Michael Barr, and this is Bloomberg Nathan Huge. Thank you, Michael. 0:14:36.800 --> 0:14:39.400 Six nineteen on Wall Street Live from the Bloomberg Interactive 0:14:39.400 --> 0:14:42.800 Brokers studios. This is Bloomberg day Break, speaking of huge 0:14:43.000 --> 0:14:45.360 Look at what is going on in Twitter. It just 0:14:45.520 --> 0:14:48.760 the last few hours the social media company has had 0:14:48.840 --> 0:14:52.040 to tell employees it's not making plans for widespread layoffs. 0:14:52.120 --> 0:14:54.960 But that was after The Washington Post reported that Elon 0:14:55.080 --> 0:14:58.560 Musk could cut staff by as much as seventy five 0:14:58.680 --> 0:15:02.000 percent once the deal goes through. And now reports this 0:15:02.160 --> 0:15:05.400 morning that the Biden administration is thinking of giving Elon 0:15:05.520 --> 0:15:10.200 Musk's deals greater scrutiny, including the forty four billion dollar 0:15:10.320 --> 0:15:13.240 Twitter buy out. Let's try to sort all this out now. 0:15:13.800 --> 0:15:18.520 Alex Webb is with US correspondent at Bloomberg Quick Take. Alex, 0:15:18.960 --> 0:15:22.040 what do you make of all these rewards. I think 0:15:22.040 --> 0:15:23.920 it was inevitable that there were going to be some 0:15:24.120 --> 0:15:27.880 job cuts at Twitter. We know that he had to 0:15:27.920 --> 0:15:29.960 come in and find a way of making this business 0:15:30.040 --> 0:15:32.720 work when you go to the Bay Area. I had 0:15:32.760 --> 0:15:36.520 some conversations with you know, investors and people in around 0:15:36.560 --> 0:15:39.920 the company a little while ago. Some people sort of 0:15:39.960 --> 0:15:42.640 said that actually Twitter is massively over staff. Given what 0:15:42.720 --> 0:15:45.680 its business doesn't it isn't very efficient. The big shock 0:15:45.800 --> 0:15:47.800 is the scale of the cuts that seemed to be 0:15:48.920 --> 0:15:51.880 on the books a lot. There are nevitably concerns and 0:15:51.880 --> 0:15:53.880 the impact that would have on content moderation and of 0:15:53.960 --> 0:15:57.760 course the platform security. Um. But as a private company, 0:15:57.880 --> 0:16:00.880 Elon can sort of do whatever he wants. So, uh, 0:16:02.320 --> 0:16:04.320 the people you've got to feel for right now, our 0:16:04.360 --> 0:16:07.120 Twitter employees who are feeling a great deal of doob insecurity, right. 0:16:07.200 --> 0:16:10.880 I mean, we've been talking before about how poor morale 0:16:11.480 --> 0:16:14.560 uh not only is but must be right now at Twitter. 0:16:14.680 --> 0:16:17.560 But I wonder if this raises some questions for you, 0:16:17.800 --> 0:16:20.600 not just about whether the company is being run efficiently, 0:16:20.840 --> 0:16:23.960 but about the money that Elon Musk has to put 0:16:24.000 --> 0:16:26.640 together to get this deal done. He's already said that 0:16:26.720 --> 0:16:30.520 he's massively overpaying for this company. I mean, is he 0:16:30.560 --> 0:16:32.440 going to have to cut costs just because he's putting 0:16:32.480 --> 0:16:35.160 so much money into this deal. Yeah, particularly if some 0:16:35.280 --> 0:16:37.360 of it is debt funded. He's got to find a 0:16:37.440 --> 0:16:40.880 way of you know, servicing that debt. The thing that's 0:16:40.920 --> 0:16:45.600 quite interesting is is Twitter's UM sales per employee are 0:16:45.680 --> 0:16:48.800 in the order of six hundred and seventy tho dollars. 0:16:49.280 --> 0:16:53.160 Facebook sales for employee like one point six million dollars. 0:16:53.560 --> 0:16:56.640 So there's there's quite a big discrepancy there. Now, you know, 0:16:57.840 --> 0:17:00.800 does cutting headcounts solve the problem is almost certainly not. 0:17:02.120 --> 0:17:05.200 It's also there is a private X approach which is 0:17:05.400 --> 0:17:07.520 sort of slashed then build. You go in, you stash 0:17:07.520 --> 0:17:08.840 all the things you think are done, and then you 0:17:08.880 --> 0:17:10.920 work out the things you need. Now we don't know 0:17:11.080 --> 0:17:14.479 that that is his approach, but um, there is scope 0:17:14.520 --> 0:17:17.440 certainly to make Twitter Lena how Len You know, we 0:17:17.480 --> 0:17:19.280 don't have the same access to the books that he 0:17:19.560 --> 0:17:22.920 that he might do. Um, but he certainly thinks that 0:17:23.440 --> 0:17:25.720 a lot Lee knows the answer or still do anyway, 0:17:25.720 --> 0:17:27.840 based on this taste reporting, we should say right. And 0:17:27.920 --> 0:17:30.560 we have also talked before about the types of changes 0:17:30.640 --> 0:17:32.680 Elon Musk could make, or if he does get this 0:17:32.840 --> 0:17:35.119 deal done the X app that sort of thing, what 0:17:35.400 --> 0:17:39.760 kind of changes to Twitter could we envision If it 0:17:39.880 --> 0:17:44.480 does turn out to be a much leaner operation, well, 0:17:45.480 --> 0:17:48.280 if it's Lena, then it probably doesn't have the same 0:17:48.480 --> 0:17:51.280 ADS stack right over. The head count of these places 0:17:51.400 --> 0:17:55.040 is all about building the ADS product. If he comes, 0:17:55.200 --> 0:17:58.600 if he builds something which is frankly a different business 0:17:58.880 --> 0:18:02.479 subscribers or or per subscriptions or something like that, perhaps 0:18:02.560 --> 0:18:06.200 that is an opportunity to make it quite a bit leaner. Now, 0:18:06.600 --> 0:18:09.720 if he's building it into the everything app, this X 0:18:09.880 --> 0:18:13.719 app that he that he has mooted in passing, well, 0:18:13.760 --> 0:18:16.040 that actually requires adding more services. So it's hard to 0:18:16.080 --> 0:18:18.680 see how you do that with fewer employees that you 0:18:18.800 --> 0:18:21.000 need to build things like a payments there, you need 0:18:21.080 --> 0:18:23.600 to build a platform frankly that it's easy for people 0:18:23.640 --> 0:18:27.320 to plug into that requires investment. So it's hard to 0:18:27.359 --> 0:18:31.719 see how just slashing head count in perpetuity um creates 0:18:31.800 --> 0:18:34.480 that particular roadmap, which is why there's some suspicions that 0:18:34.680 --> 0:18:37.240 it would be slash first, build later, if indeed that 0:18:37.400 --> 0:18:40.440 is his real plan and if indeed the deal goes through, 0:18:40.520 --> 0:18:43.240 we've got this reporting now that the Biden administration could 0:18:43.240 --> 0:18:46.600 be putting Elon musk steals under greater scrutiny, including Twitter. 0:18:46.640 --> 0:18:49.400 I mean, he's already under a lot of sec scrutiny 0:18:49.440 --> 0:18:52.520 in our last thirty seconds here, what's the possibility that 0:18:52.840 --> 0:18:57.200 regulatory pressures keep this deal from getting done? It would 0:18:57.200 --> 0:18:59.119 be a deep irony that it was regulatory pressures that 0:18:59.160 --> 0:19:01.080 we're going to force the deal to go through. And 0:19:01.240 --> 0:19:04.680 now if you know this has legs, regularly pressures that 0:19:04.880 --> 0:19:06.880 might put an into it. The stocks trading eight sent 0:19:07.000 --> 0:19:10.200 down in the pre market. Clearly the market thinks that 0:19:10.359 --> 0:19:13.720 this maybe does have some legs, should clarify his adventures, 0:19:13.760 --> 0:19:15.960 not just his deals, because he has Starlink, which is 0:19:16.000 --> 0:19:18.560 operations in Ukraine. So yeah, there's a deep irony at 0:19:18.600 --> 0:19:20.760 the heart of this. There's clearly some still some way 0:19:20.800 --> 0:19:23.359 to go before they would block it. As always, Alex, 0:19:23.400 --> 0:19:25.679 great to have you on with us, Alex web correspondent 0:19:25.720 --> 0:19:28.200 for Bloomberg Quick Take and taking a look at Twitter 0:19:28.320 --> 0:19:31.520 shares in the pre market, they are moving lower, down 0:19:31.640 --> 0:19:34.840 seven point seven percent, putting even more of a premium 0:19:35.240 --> 0:19:39.040 on Elon Musk's billion dollar buyout offering put it out 0:19:39.040 --> 0:19:41.920 there at twenty a share. Right now in the pre market, 0:19:41.960 --> 0:19:46.000 it's at forty thirty nine. SMP futures are lower by 0:19:46.080 --> 0:19:48.760 twenty two points. Stown futures down a hundred thirty three, 0:19:48.880 --> 0:19:53.199 NASTAC futures are down one d five points. Send your 0:19:53.240 --> 0:19:55.800 Treasury is now down to eleven thirty seconds for yield 0:19:55.840 --> 0:19:59.880 of four point to seven percent, highest level in fifth 0:20:00.040 --> 0:20:07.600 teen years. You're listening to Bloomberg day Break Bloomberg eleven 0:20:07.600 --> 0:20:10.080 three oh weather sunshine Today, highs in the low sixties, 0:20:10.119 --> 0:20:13.200 will be mostly sunny much of the day. Tomorrow mid sixties, 0:20:13.400 --> 0:20:16.160 it'll be cloudy Sunday, rainy by the afternoon, with hys 0:20:16.200 --> 0:20:19.080 back in the low sixties, currently forty seven degrees in 0:20:19.160 --> 0:20:25.959 Central Park. Broadcasting live from the Bloomberg Interactive Broker's studio 0:20:26.119 --> 0:20:29.000 in New York, Bloomberg E living free on to Washington, 0:20:29.080 --> 0:20:33.159 d C. Bloomberg to Boston, Bloomberg one O six one 0:20:33.280 --> 0:20:36.720 to San Francisco, Bloomberg nine six to the Country, Sirius 0:20:36.920 --> 0:20:39.280 XM to had A one nineteen and around the globe 0:20:39.400 --> 0:20:42.879 the Bloomberg Business app in Bloomberg Radio Dot Com. This 0:20:43.359 --> 0:20:52.120 is Bloomberg Daybreak. It's six thirty on Wall Street. Good morning. 0:20:52.160 --> 0:20:55.000 I'm Nathan Hagar and I'm Karen Moscow. We are just 0:20:55.080 --> 0:20:57.359 about three hours away from the open of US training. 0:20:57.480 --> 0:20:59.120 Time for the five things that you need to notice 0:20:59.119 --> 0:21:03.159 start your day to you buy Interactive Brokers. Interactive Broker's 0:21:03.200 --> 0:21:05.240 clients are an interest of up to two point five 0:21:05.320 --> 0:21:07.760 eight percent on the idle cash and their brokerage accounts. 0:21:08.000 --> 0:21:10.400 Visit i v k R dot com slash interest rates 0:21:10.480 --> 0:21:13.800 to learn more. First, UK government leaders are weighing next 0:21:13.840 --> 0:21:17.120 steps after the resignation of Prime Minister Liz Truss. All 0:21:17.160 --> 0:21:20.159 let's have Rishi Sunac Penny More not in Boris Johnson 0:21:20.200 --> 0:21:22.920 as the most likely candidates to replace trust and we 0:21:23.000 --> 0:21:25.920 get a reaction from former Chancellor Philip Hammon this morning. 0:21:26.280 --> 0:21:28.440 I'm not gonna say until I know who the line 0:21:28.560 --> 0:21:31.080 up of candidates is, who I think would be the 0:21:31.200 --> 0:21:35.360 person who will most effectively deliver stability. But I don't 0:21:35.440 --> 0:21:39.000 think going back into the past and reincarnating a previous 0:21:39.119 --> 0:21:41.879 prime minister is going to be any way to reassure markets. 0:21:42.119 --> 0:21:44.760 Former Chancellor Philip Hammon tells us the new UK government 0:21:44.840 --> 0:21:48.320 must avoid signaling more chaos to the market. Staying overseas 0:21:48.400 --> 0:21:51.720