Speaker 1: Bloomberg Audio Studios, podcasts, radio news.
Speaker 2: This is the Blueberg daybaqre At podcast. Good morning, It's Wednesday,
Speaker 2: the third of June. I'm Caroline Hepka in London.
Speaker 3: And I'm Stephen Caroline Brussels. Coming up today, the US
Speaker 3: proposers new tariffs of at least ten percent on imports
Speaker 3: from the UK, the EU, China, and many others.
Speaker 2: The European Union moves to reclaim its digital sovereignty as
Speaker 2: Palente comes under fire from UK lawmakers.
Speaker 3: The US and around resume strikes. Is The top oil
Speaker 3: executive warns that everyone is asleep at the wheel.
Speaker 2: Plus seeking a fifteen million percent return. How revolutes founder
Speaker 2: used a half million dollar investment to create a company
Speaker 2: that could now net him seventy six billion dollars. Let's
Speaker 2: start with a roundup of our top stories.
Speaker 3: The US is proposing tariffs of at least ten percent
Speaker 3: on imports from most major trade partners following an investigation
Speaker 3: into goods allegedly produced using forced labor. The probes they
Speaker 3: are put one part of the administration's effort to revive
Speaker 3: Trump's tariffs after the Supreme Court ruled that many of
Speaker 3: them were unconstitutional. The ten percent rate would apply to
Speaker 3: imports from the UK, the EU, Canada, Mexico, and Taiwan.
Speaker 3: Products from other major economies, including China, India, Japan, South Korea,
Speaker 3: Brazil and Switzerland would be subject to a twelve and
Speaker 3: a half percent levy. Former US Secretary of State Mike
Speaker 3: Pompeio gave his reaction to the announcement as the news
Speaker 3: broke overnight.
Speaker 4: The President has used tariffs to try and achieve rejectives.
Speaker 4: That's a legitimate use of America's power to tax. Right,
Speaker 4: It's a very reasonable thing when you think other nations
Speaker 4: are not behaving in a way that are consistent with
Speaker 4: the things that matter to your citizens, the people that
Speaker 4: the president was elected to represent. Hopefully you'll set up
Speaker 4: clearly this is the expectation, this is the behavior we're
Speaker 4: trying to achieve. When you do that, you remove the
Speaker 4: tariff and countries go compete.
Speaker 5: But I have no problem with the.
Speaker 4: President that states to making assistant saying now this is
Speaker 4: this is the right thing to do.
Speaker 5: Countries will make their.
Speaker 3: Own choices, America's former chief diplomat Mike Pompeio, speaking to Bloomberg.
Speaker 3: The levies will not take effect immediately under a subject
Speaker 3: to a public comment and review period that begins this week.
Speaker 2: The European Union will today announce plans to boost its
Speaker 2: tech industry and reduce its reliance on America and other suppliers.
Speaker 2: A draft of the plan seen by Bloomberg contains measures
Speaker 2: on chips, cloud computing, and artificial intelligence, including driving construction
Speaker 2: of European data centers. The proposal is an effort to
Speaker 2: challenge US dominance of the sector from major names like
Speaker 2: Amazon Web Services, Microsoft a Zoo, and Google Cloud. Former
Speaker 2: Executive Vice President of the European Commission, Margareta Vestayer has
Speaker 2: told Bloomberg Radio that Europe needs more alternatives.
Speaker 6: I think it's really important to define technological sovereignty as
Speaker 6: a question of control.
Speaker 7: Can you control what is essential to you?
Speaker 6: And of course not all data's equal, but some data
Speaker 6: is more than other data. And I think it's really
Speaker 6: important that data that you really want only to be
Speaker 6: for European jurisdiction, then you make sure that you have
Speaker 6: only European jurisdiction.
Speaker 2: Margaret Avesta there who helped to develop the Used Digital
Speaker 2: rule Book. It comes amid reports that the bloc's twenty
Speaker 2: billion euro investment plan in AI data centers faces a
Speaker 2: number of delays and funding issues sources Heel Bloomberg. The
Speaker 2: EU's efforts to back gigafactories announced last year lack clarity
Speaker 2: about demand and subsidies.
Speaker 3: In the UK, members of Parliament are calling on the
Speaker 3: government to break its contract with Palent, Heer branding it
Speaker 3: an unacceptable point of weakness. US software companies being branded
Speaker 3: a major risk by lawmakers on the Science, Innovation and
Speaker 3: Technology Committee Bloomberg.
Speaker 5: James Wilcock has the story.
Speaker 8: Palente is the number one concern for MPs looking at
Speaker 8: how the public sector manages its data. They note the
Speaker 8: UK government is rely on a tiny number are very
Speaker 8: powerful tech supplieres for its infrastructure, but they single out
Speaker 8: the US software company for its over political positions, which
Speaker 8: they call a clear mismatch with British values. Palente has
Speaker 8: previously defended itself as saying the company operates like all
Speaker 8: other government tech vendors, but the growing political backlash is
Speaker 8: a sign of the changing attitudes towards relying on America
Speaker 8: and its firms in London. James Wilcock Bloomberg Radio.
Speaker 2: The fragile ceasefire in the Middle East faces its latest
Speaker 2: test after US forces intercepted Iranian strikes and hit a
Speaker 2: command center in the Islamic Republic. US Central Command said
Speaker 2: that Iran had launched ballistic missiles and drones towards neighboring countries,
Speaker 2: including Kuwait and Bahrain. His honor and are managing editor
Speaker 2: for the Middle East and Africa.
Speaker 9: The bottom line of what's happening, including those missile attacks
Speaker 9: by Iran and the US response, is that we are
Speaker 9: seeing an editation in the market.
Speaker 10: People are losing.
Speaker 9: Belief that the longer this process takes, the more likely
Speaker 9: it is to see risks seculdly railed whole peace process,
Speaker 9: if we can call it that, and the agitation is
Speaker 9: expressing itself in many ways.
Speaker 2: Bloomberg's Honor and there as the US military is pursuing
Speaker 2: less public ways of protecting vessels in the Strait of
Speaker 2: Homers with a quiet version of Project Freedom. Bloomberg understands
Speaker 2: that some ships are turning off their transponders and sticking
Speaker 2: close to the Omani coast to avoid Iranian minds, with
Speaker 2: the US military assisting if needed.
Speaker 3: Vital's top executive in the Middle East says Europe and
Speaker 3: the US aren't facing up to the growing oil supply crunch.
Speaker 3: Speaking at an SMP Global conference in London, Tom Baker
Speaker 3: accused Western governments of being asleep at the wheel when
Speaker 3: it comes to the crisis. Vital estimates global demand destruction
Speaker 3: at around four million barrels a day, with countries delaying
Speaker 3: purchases and the hope that a resolution to the Iran
Speaker 3: war will bring down prices. Brankr morning's trading just over
Speaker 3: at ninety seven dollars a barrel, up one percent.
Speaker 2: SpaceX is aiming to sell shares at one hundred and
Speaker 2: thirty five dollars a piece for its record breaking seventy
Speaker 2: five billion dollar IPO. According to Reuters, the firm is
Speaker 2: breaking the traditional listing process of announcing a price range
Speaker 2: before marketing the shares and setting the price before trading begins.
Speaker 2: Dan Ives, global head of Technology research at web Bush Securities,
Speaker 2: says investor interest in tech is set to continue.
Speaker 11: It's a tie a way of VIPs that are coming,
Speaker 11: but they're all at the heart of the AI revolution,
Speaker 11: and I think to some extent, when you look where
Speaker 11: we are, we continue believe this AI party start in
Speaker 11: nine pm.
Speaker 5: It's about eleven thirty pm.
Speaker 12: Party goes to four AM turn i'ves from web Bush
Speaker 12: Security speaking there, the deal involving Elon Musk's firm would
Speaker 12: be the largest IPO on record, more than doubling the
Speaker 12: twenty nine point four billion dollars that was raised by
Speaker 12: Saudi Ramco that was back in twenty nineteen.
Speaker 3: Voters in California have been casting ballots on who should
Speaker 3: lead the country's most populous state. Democrat Javier Bersera and
Speaker 3: Republican Steve Hilton took early leads in California's governor primary
Speaker 3: to replace Democratic Governor Gavin Newsom, with about half the
Speaker 3: ballots reported. They each have about twenty six percent of
Speaker 3: the vote, according to decision desk KATEQ. In the Meryal
Speaker 3: race in Los Angeles, early results suggest that a runoff
Speaker 3: between Democratic incumbent Karen Bass and reality TV star Spencer Pratt,
Speaker 3: who was a registered Republican.
Speaker 2: Now Here in the UK, the police response to a
Speaker 2: murder in the UK has sparked outrage across the political
Speaker 2: spectrum and protests outside of police station. Henry Novak was
Speaker 2: handcuffed as he lay dying last December after his killer,
Speaker 2: victim Digwa, falsely accused him of racism. In bodycam footage,
Speaker 2: the eighteen year old can be heard saying I've been stabbed,
Speaker 2: to which an officer replies, I don't think you have. Yesterday,
Speaker 2: the Prime Minister gave his reaction after viewing the footage.
Speaker 10: It's harrowing and I have to say, as a father
Speaker 10: of a seventeen year old boy, I felt sick watching it.
Speaker 2: Kis Palmer says there are serious questions for the police
Speaker 2: to answer, while Reform UK's Nigel Farage says the reaction
Speaker 2: to the murder should be one of pure cold rage.
Speaker 2: Those are our top stories for you this morning. Let's
Speaker 2: look at the markets now. Global equities advancing to new highs,
Speaker 2: the MSCI All Country World Index up a tenth of
Speaker 2: one percent, but demand for AI stocks is really only intensified,
Speaker 2: with the topics breaking above four thousand. China's China Eggs
Speaker 2: and the Staff fifty index both also surging. US, though
Speaker 2: and European stock futures are actually both in the red.
Speaker 2: Usox pitty futures down by just above a tenth of
Speaker 2: one percent. The yenin focus with a speech from Governor
Speaker 2: Awada in Japan. In terms of bond markets, treasury yields
Speaker 2: up one and a half basis points at four forty
Speaker 2: six These as global diesel stockpiles have declined to fresh
Speaker 2: lows and break through futures this morning, currently up one
Speaker 2: point two percent, trading above ninety seven dollars.
Speaker 10: About those are the markets in.
Speaker 3: A moment more only You plans to reduce its reliance
Speaker 3: on American technology, Plus how the founder of Revolute could
Speaker 3: be in line for one of the biggest fortunes in
Speaker 3: the financial industry.
Speaker 5: But another story that caught a right this morning. The
Speaker 5: Bank of England's going wild.
Speaker 3: Perhaps not in the usual sentence we say about the
Speaker 3: center of bank, but they've opened a public vote on
Speaker 3: which wildlife animals they would like to replace historical figures
Speaker 3: on the next series of banknotes. So instead of Winston Churchill,
Speaker 3: the public can choose from a list of eighteen creatures,
Speaker 3: including a barnell, an Atlantic Puffin, a Pine Martin or
Speaker 3: a basking shark. The decision amounts first back in March,
Speaker 3: triggered outcry among some right wing politicians, but it was
Speaker 3: actually making the public said they wanted. There was a
Speaker 3: consultation run by the Bank last year and sixty percent
Speaker 3: of those nominated the theme of wildlife versus only thirty
Speaker 3: eight percent, just so they wanted to continue with noble
Speaker 3: historical figures.
Speaker 2: Yeah, unlike a past a public of votes, the Bank
Speaker 2: of England gets the final say for anyone who remained.
Speaker 5: We have enough to do, you know.
Speaker 2: Yeah, boat boat face was on a public vote that
Speaker 2: caused controversy for the naming of a ship. But anyway, look,
Speaker 2: banknotes have been reduced to symbolism in lots of rays
Speaker 2: because actually so few people use them in real life.
Speaker 2: But you're right, replacing Churchill, Shakespeare, Austin Turing has actually
Speaker 2: been quite controversial for some beyond the kind of politicking.
Speaker 2: I think there is a sort of question mark about,
Speaker 2: you know, replacing nature and of these you know and
Speaker 2: historical figures, about what that kind of symbolizes.
Speaker 10: Are you replacing the drive kind.
Speaker 2: Of industry and discovery with something pastoral that feels I
Speaker 2: don't know, quite different novel and.
Speaker 3: I'm not sure it's something I didn't realize. Parirly wildlife
Speaker 3: also is really helpful for security in banknotes, na the
Speaker 3: way that they can use it. You know, if there'll
Speaker 3: be like a secret message hidden in a puffin's beak
Speaker 3: that perhaps you'll be able to protect your bank note
Speaker 3: from being encounterfit anyway.
Speaker 5: Also, who uses cash?
Speaker 3: So I think it's the question of how many of
Speaker 3: these banknotes they'll actually be producing they eventually get made anyway.
Speaker 5: It's the subject to provoked lots.
Speaker 3: Of debate among our team this morning, but you'll find
Speaker 3: a link to the story in our podcast show Notes. Well,
Speaker 3: let's turn back to one of our top stories this morning.
Speaker 3: The European Union will today announce the plan which aims
Speaker 3: to boost its technology industry. The so called Tech Sovereignty
Speaker 3: Package is an effort to confront US dominance in the sector,
Speaker 3: and our eutech reporter Jhan Valpaicelli is with us in
Speaker 3: studio for more this morning. First of all, what do
Speaker 3: we know about what's in this package?
Speaker 13: Well Son, The announcement is coming this afternoon, but we
Speaker 13: already know that the packages is going to contain four
Speaker 13: main pillars. The first one is going to be about
Speaker 13: Cloud and the I, the so called Cloud and the
Speaker 13: I Development Act KADA. The second is going to be
Speaker 13: a Chips Act. That's a second Chips Act. There was
Speaker 13: a Chips Act already in twenty twenty three. The third
Speaker 13: document is going to be about open source, essentially encouraging
Speaker 13: the take up of open source software in the year
Speaker 13: and the fort is going to be about energy and THEI,
Speaker 13: both in terms of sustainability of AI data centers and
Speaker 13: in terms of using AI to make the most sustainable
Speaker 13: How feasible.
Speaker 2: Though, do you think it is to actually try to
Speaker 2: reduce your stupendency on American tech?
Speaker 13: Well, that's the main question about the entire endeavor, I
Speaker 13: guess right. If you look at the cloud computing market,
Speaker 13: for instance, there's a study by the European Parliament, another
Speaker 13: institution in Brussels, which has realized that seventy percent of
Speaker 13: europe persential the European cloud market is dominated by the
Speaker 13: big three US cloud companies, so the feed is very
Speaker 13: large when it comes to cloud. Very similar problem with Chips.
Speaker 13: The U in twenty twenty twenty twenty three when the
Speaker 13: first Chips actors passed was helping to double its production
Speaker 13: or worldwide production of semiconductors from ten percent to twenty
Speaker 13: percent by twenty thirty. That target seems very very unfeasible
Speaker 13: right now, it's kind of been abandoned. So how is
Speaker 13: it going to be? I think it's going to be easy.
Speaker 13: I suppose that no one is really dreaming of replacing
Speaker 13: the US completely. It's more about having at least a
Speaker 13: slice of the market that might be sheltered in case
Speaker 13: of very serious geopolitical tensions trade disruptions.
Speaker 5: So it's really about.
Speaker 13: Edging more, having more of it, than replacing it completely.
Speaker 3: An illustration of the difficulty in this as well as
Speaker 3: in your latest reporting to on the euse efforts to
Speaker 3: invest in AI data centers.
Speaker 5: That's run into trouble too. What's gone wrong there? That's
Speaker 5: a bil.
Speaker 13: Less tragic than it sounds. It's most about the U
Speaker 13: promising too much too late, meaning that it unveiled this
Speaker 13: project to create five to even ten now so called
Speaker 13: giga factories AI giga factories, which is essentially data centers
Speaker 13: with advanced American AI chips to train AI models, design,
Speaker 13: developed and operating in the EU. That plan was unbuilt
Speaker 13: I think late last year. But the U is getting
Speaker 13: close to the end or its current budget cycle, so
Speaker 13: the funding that was announced is actually not fully available
Speaker 13: right now. Only a few of these giga factories could
Speaker 13: be funded with the current budget, so the delays are
Speaker 13: mostly due to the fact that the next budget one
Speaker 13: that we will span from twenty twenty eight to twenty
Speaker 13: thirty four is still in the negotiation. So yeah, delays
Speaker 13: are not natural in that department. Of course, maybe there's
Speaker 13: a pr failure there because a lot of the companies
Speaker 13: were preparing, really raring to go already and that's not
Speaker 13: the case for a bit. But we expect an announcement
Speaker 13: a call for official bits to be opened in July.
Speaker 3: So okay, John, thank you very much for joining us.
Speaker 3: John Varpatality, there are EU Tech Reporter in the Brussels
Speaker 3: studio this morning. Stay with us. More from Bloomberg Daybreak
Speaker 3: Europe coming up after this.
Speaker 2: Well founded by Nikolai Stronsky in twenty fifteen, Revolute is
Speaker 2: aiming for a near two hundred billion dollar initial public
Speaker 2: offering within the next two years. From startup to fintech juggernauts.
Speaker 2: In today's Bloomberg Big Take, Aisha Ghani has done a
Speaker 2: deep dive into the business and she joins us now.
Speaker 2: Nick Schronsky, he is massively ambitious, He's been huge successful.
Speaker 10: How close is he.
Speaker 2: To building, as he puts it, the first global bank?
Speaker 7: Yes, that's right.
Speaker 1: Revelue already has seventy five million customers around the world,
Speaker 1: from the UK to Mexico. They're already picking up bank
Speaker 1: licenses around the globe. However, there is a huge, huge,
Speaker 1: untapped market still for Storronsky to access and they have
Speaker 1: a way to go, and their peal of Revolute is
Speaker 1: the Stronsky factor. He is hugely ambitious. They want to
Speaker 1: get to one hundred million customers. They recently said they
Speaker 1: hope to achieve that by this time next year, so
Speaker 1: there's a long way to go. However, they're already disrupting
Speaker 1: the banking space, and I think that's a huge part
Speaker 1: of this story.
Speaker 7: As they go around.
Speaker 1: The world and as they pick up these licenses, they're
Speaker 1: arriving with their product, whether it's their FX product to
Speaker 1: their business banking.
Speaker 3: So how much does he stand to make them from
Speaker 3: an IPO part of.
Speaker 1: This ambition is that Staunsky's own wealth is tied to
Speaker 1: the success of this company that he's built. He had
Speaker 1: initially put in half a million of his own funds
Speaker 1: when you started up the company.
Speaker 7: The company is now worth.
Speaker 1: Seventy five billion, and we have found that that puts
Speaker 1: him at twenty point four billion dollars in terms of
Speaker 1: his own wealth, which makes him the UK's richest man. Now,
Speaker 1: when it comes to IPO, he has revealed that he's
Speaker 1: eyeing a listing within two years. And according to internal
Speaker 1: documents that I've obtained, we see that his incentives and
Speaker 1: his compensation increases with revolutes valuation and according to this
Speaker 1: document that ends at just under two hundred billion, and
Speaker 1: at two hundred billion valuation and revolue, he could be
Speaker 1: worth seventy six billion dollars.
Speaker 7: Which is absolutely huge.
Speaker 1: And we're talking about a wealth that exceeds Ken Griffin
Speaker 1: or Steve Schwartzman.
Speaker 2: Yeah, which is extraordinary, isn't it. There are some hurdles though,
Speaker 2: and you've highlighted them in your reporting.
Speaker 10: Some hurdles for Revolute.
Speaker 2: I mean, it's aiming for one hundred million customers in
Speaker 2: one hundred countries and this lofty valuation. You know, there
Speaker 2: are plenty of issues though for this app to deal with.
Speaker 1: Yeah, of course, and just tink it quickly back to
Speaker 1: the IPO.
Speaker 7: I mean, Stornsky has said that part of the reason.
Speaker 1: Why he wants to go public is for gaining that trust.
Speaker 1: You know, you have a lot of trust as a
Speaker 1: public company, So as a company gets bigger, it also
Speaker 1: means that you get a lot more scrutiny from watchdogs
Speaker 1: around the world. You have to continuously pre to regulators
Speaker 1: around your governance structure.
Speaker 7: It means that the very nimble digital.
Speaker 1: Lending company will have to handle the red tape that
Speaker 1: banks have to deal with day in, day out, and
Speaker 1: so that's a challenge to the kind of model that
Speaker 1: investors are so used to seeing. As we delve into
Speaker 1: the financial accounts of Revolute right now, they look like
Speaker 1: a very conservative payments firm.
Speaker 7: They make most of their money from fees, and so we.
Speaker 1: Ask the question what that will look like as they
Speaker 1: add more lending to their books, and they have to
Speaker 1: also keep up with their profit margins, which have been
Speaker 1: absolutely staggering. So those are some of the risks that
Speaker 1: we outline in this story. I'm here in Amsterdam for
Speaker 1: Money twenty twenty, where a lot of the execs will
Speaker 1: be speaking on stage, and there's a lot of buzz
Speaker 1: around this firm, especially when you look at the sector
Speaker 1: as a whole. So they've got these huge ambitions. For
Speaker 1: so far they've been checking off and they've been investing
Speaker 1: in these locations as well. Just this week revenue, announce
Speaker 1: additional investment into France. Much is the delight of Macron
Speaker 1: even with the ukend banking license. It took over five
Speaker 1: years to achieve that, so we'll see what happened.
Speaker 5: Thanks for listening to Bloomberg Daybreak Europe.
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