WEBVTT - China's Economic Concerns; The World's Hottest Day on Record

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<v Speaker 1>Good morning.

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<v Speaker 2>I'm Nathan Hager and I'm Karen Moscow. Here are the

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<v Speaker 2>stories we're following today.

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<v Speaker 3>We begin with a slew of news involving China this morning.

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<v Speaker 3>Let's start with economic data. The latest reading show expansion

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<v Speaker 3>in China's services industry slowed in June. Bloomberg Markets editor

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<v Speaker 3>Eddie Vanderwald says the trend is troubling.

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<v Speaker 4>This number is above fifty, but it is terrible. So

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<v Speaker 4>the weakness that we're seeing here, I think will probably

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<v Speaker 4>start to push the authorities to deliver a broad based stimulus,

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<v Speaker 4>which is something we haven't seen. Stimulus we've seen so

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<v Speaker 4>far has really been targeted on the property sickness, so

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<v Speaker 4>it needs to be a little bit more broad by.

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<v Speaker 3>Bloomberg's Eddie Vanderwald notes that tais China Services PMI declined

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<v Speaker 3>to fifty three point nine, down from fifty seven point

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<v Speaker 3>one in May.

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<v Speaker 2>Meantime, Nathan supply chain issues TI geopolitics are also in focus.

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<v Speaker 2>It's been a common theme when it comes to US

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<v Speaker 2>China relations. Now Chinese President Xi Jinping is calling on

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<v Speaker 2>the world to turn away from decoupling and reconsidering supply chains.

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<v Speaker 2>Bloomberg Day Break Asia anchor. Brian Curtis has details from

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<v Speaker 2>Hong Kong.

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<v Speaker 5>It's ironic. The impassioned call came a day after China

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<v Speaker 5>itself imposed limits on exports of two key medals. These

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<v Speaker 5>are minerals used to make advanced semiconductors. President She told

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<v Speaker 5>the Shanghai Cooperation Organization that China wants to work with

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<v Speaker 5>nations to reject this setting up of barriers. It also

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<v Speaker 5>comes a day after the Chinese government postponed a trip

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<v Speaker 5>to Beijing by Europe's top diplomat, Joseph Perell. No reason

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<v Speaker 5>was given for the postponement.

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<v Speaker 1>In Hong Kong. Brian Curtis, Bloomberg day Break.

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<v Speaker 3>Okay, Brian, thanks you. More details on that restriction of

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<v Speaker 3>metal exports from China. Beijing says exports for two medals

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<v Speaker 3>crucial to make semiconductors, must now apply for licenses to

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<v Speaker 3>ship them out of the country. Analysts say the impact

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<v Speaker 3>on the US tech sector depends on the current stockpile

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<v Speaker 3>levels of these medals the companies have on hand, but

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<v Speaker 3>if the restrictions drag on, prices will likely go up.

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<v Speaker 2>And that's not all when it comes to the US

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<v Speaker 2>and China butting heads on tech and it appears the

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<v Speaker 2>White House is planning another round of fresh restrictions on Beijing.

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<v Speaker 2>Bloomberg's John Tucker joins US Now with the details.

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<v Speaker 1>John, Good morning, and Karen.

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<v Speaker 6>The Biden administration preparing to tighten export controls, and this

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<v Speaker 6>time the focus is on cloud computing services like those

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<v Speaker 6>provided by Amazon and Microsoft. The cloud's critical in training

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<v Speaker 6>AI models. The Wall Street journalist as Washington may require

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<v Speaker 6>cloud providers to get permission before they could do business

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<v Speaker 6>with Chinese firms. The administration doesn't want China to get

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<v Speaker 6>a leg up on the US when it comes to

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<v Speaker 6>artificial intelligence. Microsoft's Azure and Amazon Web Services are the

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<v Speaker 6>global leaders in the business of providing Internet computing to enterprises.

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<v Speaker 6>This would be an escalation of export controls from October,

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<v Speaker 6>when the US said it would restrict sales of some

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<v Speaker 6>artificial intelligence chips to China. You are John Tucker, Bloomberg Daybreak.

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<v Speaker 3>All right, John, Thanks, there's some positive news out of

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<v Speaker 3>China this morning. It involves Tesla. The evmaker's China output

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<v Speaker 3>increased almost twenty percent in June, according to preliminary data

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<v Speaker 3>from China's Passenger Car Association. Earlier this week, Tesla smashed

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<v Speaker 3>estimates by setting a company record in quarterly sales. But

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<v Speaker 3>in the pre market, Tesla shares are giving back just

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<v Speaker 3>a bit. They're down four tenths of one percent.

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<v Speaker 2>Well back here in the US, Nathan, we have a

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<v Speaker 2>developing story in Washington. Multiple reports say the White House

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<v Speaker 2>was briefly evacuated Sunday after the Secret Service discovered powder

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<v Speaker 2>in a West Wing common area. Preliminary TAJ showed this

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<v Speaker 2>substance was believed to be cocaine. President Biden was not

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<v Speaker 2>at the White House Sunday evening. He was in Camp

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<v Speaker 2>David for the weekend.

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<v Speaker 3>We also have news at the intersection of politics and

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<v Speaker 3>social media. Karen a federal judge in Louisiana has ordered

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<v Speaker 3>Key Biden administration officials and agencies not to contact social

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<v Speaker 3>media platforms to suppress speakers in viewpoints they disagree with.

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<v Speaker 3>The ruling could curtail efforts to combat misinformation about health

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<v Speaker 3>and other issues. It comes after Louisiana and Missouri filed

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<v Speaker 3>cases claiming the administration with silencing views of the question

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<v Speaker 3>COVID policies, and the legitimate of the twenty twenty election.

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<v Speaker 7>Wells.

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<v Speaker 2>In breaking news this morning, Nathan on labor negotiations between

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<v Speaker 2>the Teamsters and UPS. The International Brotherhood of Teamsters says

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<v Speaker 2>its negotiations with United Personal Service have collapsed. They walked

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<v Speaker 2>away from the bargaining table around four am Eastern time.

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<v Speaker 2>That increases the chances of a nationwide strike when the

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<v Speaker 2>Teamsters contract with UPS expires at the end of this month.

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<v Speaker 3>Karen, We're coming off an Independence Day that was hot

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<v Speaker 3>and humid for much of the country. At the same time,

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<v Speaker 3>we've reached another milestone in the global battle against climate change,

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<v Speaker 3>and Bloomberg Zed Baxter has that story.

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<v Speaker 8>Global temperatures hit a record high on Monday. The average

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<v Speaker 8>worldwide temperature was sixty three degrees fahrenheit, topping the past

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<v Speaker 8>high set in August of twenty sixteen. The National Centers

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<v Speaker 8>from Environmental Prediction say the new high underscores the extremity

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<v Speaker 8>of the twenty twenty three summer and the northern hemisphere

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<v Speaker 8>and brings into focus the slow pace of global progress

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<v Speaker 8>on curbing emissions and their estimates at the current NOS

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<v Speaker 8>phenomenon is set to push global temperatures still higher. In

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<v Speaker 8>San Francisco, I'm at Baxter Bloomberg daybreak.

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<v Speaker 2>All right, and thank you turning to the markets now,

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<v Speaker 2>we're seeing movement in the oil market this morning. Brent

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<v Speaker 2>crude is weaker after a Tuesday rally that came on

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<v Speaker 2>the heels of output cuts by Russia and Saudi Arabia.

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<v Speaker 2>Traders are following commentary from Saudi's energy minister today when

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<v Speaker 2>he addresses the eighth Opek International Seminar in Vienna.

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<v Speaker 3>Time now to take a look at some of the

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<v Speaker 3>other stories making news in New York and around the

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<v Speaker 3>world with Bloomberg's Michael Barr.

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<v Speaker 1>Good morning, Michael, Good morning, Nathan.

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<v Speaker 9>Philadelphia police say as suspected gunman will be in court

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<v Speaker 9>today after five people were killed and two children injured

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<v Speaker 9>when he opened fire apparently at random, across several city

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<v Speaker 9>blocks with an ar style rifle. Authority to say the

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<v Speaker 9>gunman was wearing body armor and a ski mask. Philadelphia

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<v Speaker 9>Mayor Jim Kenny I.

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<v Speaker 5>Was today at city at the Independence Hall where they

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<v Speaker 5>wrote that Constitution and the Second Amnis was never intended

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<v Speaker 5>to protect this.

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<v Speaker 9>There were also mass shootings in Baltimore and ford Worth,

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<v Speaker 9>Texas ahead of the fourth of July holiday. Flights again

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<v Speaker 9>were canceled or delayed yesterday in the US, as Americans

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<v Speaker 9>begin to head home from the long weekend. United had

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<v Speaker 9>its problems rain at Newark Airport costed flight delays last week.

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<v Speaker 9>The flight schedule came unraveled due to weather at Newark.

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<v Speaker 9>At least two more possible shark bites were reported off

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<v Speaker 9>Long Island beaches the fourth of July. Incidents happened just

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<v Speaker 9>today after another two cases were reported. One victim was

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<v Speaker 9>swimming in chest deep water when he was bitten on

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<v Speaker 9>the right knee. Meanwhile, another swimmer was bitten on the

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<v Speaker 9>hand off Fire Island pines. Both men in their forties

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<v Speaker 9>were taken to the hospital with non life threatening injuries.

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<v Speaker 9>The Israeli military says it has withdrawn its troops from

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<v Speaker 9>a militant stronghold in the occupied West Bank. The pullout

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<v Speaker 9>this morning and Jeanine ended an intense two day operation

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<v Speaker 9>that killed at least twelve Palestinians and drove thousands of

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<v Speaker 9>people from their homes, and Israeli soldier was also killed.

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<v Speaker 9>The head of the UN Nuclear Agency is in Japan

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<v Speaker 9>this week as the country prepares to release waste water

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<v Speaker 9>from the damaged Fukushima nuclear plant. The International Atomic Energy

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<v Speaker 9>Agency is trying to reassure people that the water release

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<v Speaker 9>is safe. UN Nuclear Agency Chief Rafieo Grossi says dumping

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<v Speaker 9>the treated water would have, in his words, negligible environmental impact.

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<v Speaker 8>The plan as it has been proposed and devised is

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<v Speaker 8>in conformity with the agreed international standards.

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<v Speaker 9>Local reports say utility operator Tepco could start dumping wastewater

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<v Speaker 9>as early as August. Cities across the nation held Fourth

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<v Speaker 9>of July fireworks shows. In New York City, crowds gathered

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<v Speaker 9>along the East River last night for the May Sea's

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<v Speaker 9>fireworks show. Global News twenty four hours a day, powered

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<v Speaker 9>by more than twenty seven hundred journalist nailysts in over

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<v Speaker 9>one hundred twenty countries. I'm Michael Bard. This is Bloomberg, Nathan.

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<v Speaker 3>Okay, Michael, thanks time now for our Bloomberg sports up date.

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<v Speaker 1>Good morning, John Stanshawer, Good.

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<v Speaker 7>Morning, Nathan. It's been such a surprisingly strong first half

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<v Speaker 7>of the season for the Baltimore Orioles, a rather disappointing

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<v Speaker 7>one for the Yankees, and yet the Yanks win tonight

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<v Speaker 7>and again tomorrow they'll have tied the Orioles for second

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<v Speaker 7>place in the Al East. Yanks had to come from

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<v Speaker 7>behind win Mouday Night came back for a holiday matinee

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<v Speaker 7>at the stadium and won eight to four. A big

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<v Speaker 7>day for Glaver Torres. He always hits well versus Baltimore

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<v Speaker 7>to run homer before the first out of the first,

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<v Speaker 7>getting the later doubled and scored him.

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<v Speaker 1>With the game tie at three.

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<v Speaker 7>Torres, who's been at times criticized for lack of ustle,

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<v Speaker 7>walked and scored all the way from the first on

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<v Speaker 7>a single. Mets at Arizona used the long ball.

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<v Speaker 10>Won to to Marte swaying a high fly ball to

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<v Speaker 10>left field Carol going back to the track, he turns

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<v Speaker 10>and it's gone, a three run, go ahead home run

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<v Speaker 10>first starling Barte about ten rows into the seats.

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<v Speaker 7>And left WCBS also home runs for Brandon Nemo Francisco Alvarez.

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<v Speaker 7>MaTx beat the Diamondbacks eight to five. Max Scherzers struck

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<v Speaker 7>out nine and proved to.

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<v Speaker 1>Eight and two.

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<v Speaker 7>Rough day for the La Angels, they lost to San Diego.

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<v Speaker 7>Shoe Otani gave up back to back home runs, had

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<v Speaker 7>to leave the game of the blister, and Mike Trout

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<v Speaker 7>put on the injured list with a broken hand. He's

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<v Speaker 7>gonna miss at least a month, maybe two. The Padres

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<v Speaker 7>released forty free year old Slaver Nelson Cruz four hundred

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<v Speaker 7>and sixty four career home runs. Only four players ever

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<v Speaker 7>have hit more after the age of twenty nine. Rain

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<v Speaker 7>at Wimbledon's the only matches completed where they're on the

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<v Speaker 7>two courts that have a roof easily wins for the

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<v Speaker 7>top seed, Carlos Alcarez and thirty six year old Andy Murray.

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<v Speaker 7>The defending champe Lana Rabakaa, needed three sets but got

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<v Speaker 7>by American Shelby Rogers. Novak Djokovic plays today, so does

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<v Speaker 7>the women's top seed us Yonte John Stanhelli.

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<v Speaker 1>Boolberg sports.

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<v Speaker 9>From coast to coast, from New York to San Francisco,

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<v Speaker 9>Boston to Washington, d nationwide on Syrias Exam, the Bloomberg

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<v Speaker 9>Business app and Bloomberg dot Com.

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<v Speaker 1>This is Bloomberg Daybreak.

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<v Speaker 3>We had a Tai Shehen Services Purchasing Managers index for

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<v Speaker 3>the month of May that came in quite a bit

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<v Speaker 3>weaker than expected. And it comes as Treasury Secretary Janet

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<v Speaker 3>Yellen heads to China to try to find common economic

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<v Speaker 3>ground with China.

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<v Speaker 1>Let's get more on all this now. In a roundtable discussion.

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<v Speaker 3>We are joined by Bloomberg opinion columnist Matthew Brooker and

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<v Speaker 3>Rebecca Chung Wilkins, Bloomberg's Asia Government and Politics correspondent.

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<v Speaker 1>Good to speak with both of you. Let's start with you, Matthew.

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<v Speaker 3>With these signs of weakness in the Chinese economy, what's

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<v Speaker 3>the potential impact for the global economic outlook?

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<v Speaker 11>Well, I'd say not good. I mean, I think the

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<v Speaker 11>restrictions that China has put these these these export of

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<v Speaker 11>metals that they use in semiconductors are not I mean,

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<v Speaker 11>they're not disastrous. There are there are alternatives that can

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<v Speaker 11>be developed, but it's a it's a it's another sign

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<v Speaker 11>of the of the amount of tension that's in the

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<v Speaker 11>relationship at the moment.

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<v Speaker 3>I think, yeah, we are seeing that tension given the

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<v Speaker 3>export controls that you mentioned, and it seems like continuing

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<v Speaker 3>signs as well from the Biden administration as almost a

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<v Speaker 3>step by step move to limit China's access to technology. Rebecca,

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<v Speaker 3>let's bring you in on this here, because we're waiting

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<v Speaker 3>for Treasury Secretary Yellen to head to China to try

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<v Speaker 3>to reset the Chinese relationship to some extent.

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<v Speaker 1>But when we have these moves happening. Is it possible

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<v Speaker 1>to have a reset?

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<v Speaker 12>Yeah, it's certainly going to be a challenge for Yell.

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<v Speaker 13>And obviously it's positive that the trip is going ahead,

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<v Speaker 13>and this sort of ability to you know, disagree together

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<v Speaker 13>and still have these open lines of communications at the

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<v Speaker 13>top level is somewhat at least a somewhat present somewhat

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<v Speaker 13>of a thaw at least they're speaking at the same time. Obviously,

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<v Speaker 13>we see now both China showing this new willingness to

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<v Speaker 13>push back against what it sees as containment efforts in

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<v Speaker 13>those ways that Matthew points to. But the US also

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<v Speaker 13>now reportedly considering curbing Chinese companies access to cloud computing

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<v Speaker 13>services for anything that pertains to AI chips, so again

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<v Speaker 13>closing that loophole.

0:12:27.960 --> 0:12:30.680
<v Speaker 12>So, you know, with Beijing and the US both kind of.

0:12:30.840 --> 0:12:34.959
<v Speaker 13>Ratcheting up these policies, it's hard to see any big

0:12:35.120 --> 0:12:37.719
<v Speaker 13>sort of significant debt on or agreement coming out of

0:12:37.800 --> 0:12:38.480
<v Speaker 13>Yellen's visit.

0:12:39.200 --> 0:12:41.800
<v Speaker 3>Is there a dot to connect here, Matthew with the

0:12:41.960 --> 0:12:46.520
<v Speaker 3>Biden administration's moves to limit access by China to technology

0:12:46.640 --> 0:12:48.520
<v Speaker 3>and now the economic impact here.

0:12:52.200 --> 0:12:55.280
<v Speaker 11>I mean, I feel there's a kind of a tip

0:12:55.360 --> 0:12:56.360
<v Speaker 11>for tap game.

0:12:56.240 --> 0:12:56.760
<v Speaker 7>Going on here.

0:12:56.840 --> 0:12:59.120
<v Speaker 11>I mean, if you look at the tone of the

0:12:59.360 --> 0:13:02.960
<v Speaker 11>discourse between China and the US and the EU as well,

0:13:04.480 --> 0:13:06.840
<v Speaker 11>there's a lot of talks, I think from the Chinese

0:13:06.920 --> 0:13:11.559
<v Speaker 11>side about how cooperation is the only way forward and

0:13:11.679 --> 0:13:15.600
<v Speaker 11>that decoupling isn't going to work. We've got an independent world,

0:13:16.400 --> 0:13:20.280
<v Speaker 11>and at the same time, you know, things like these

0:13:20.720 --> 0:13:24.480
<v Speaker 11>export controls. I feel it looks to me like, you know,

0:13:24.520 --> 0:13:26.719
<v Speaker 11>they're kind of trying to say, send the signals what

0:13:27.280 --> 0:13:30.600
<v Speaker 11>we should be doing is cooperating. But you know, if

0:13:30.640 --> 0:13:33.160
<v Speaker 11>you're going to if you're going to restrict our access

0:13:33.240 --> 0:13:37.160
<v Speaker 11>to things that damage our economy, then we have the

0:13:37.200 --> 0:13:38.679
<v Speaker 11>same tools available to us.

0:13:39.960 --> 0:13:43.480
<v Speaker 1>What is the potential economic impact to China for putting

0:13:43.559 --> 0:13:49.600
<v Speaker 1>on these export controls, Rebecca, Is the Chinese economy insulated

0:13:49.760 --> 0:13:52.920
<v Speaker 1>enough that it can withstand these kinds of export controls

0:13:53.600 --> 0:13:57.200
<v Speaker 1>without doing damage to its economy even further Well.

0:13:57.040 --> 0:13:58.120
<v Speaker 12>There are two sort of risks.

0:13:58.320 --> 0:14:01.839
<v Speaker 13>The first is the media, and the risk is if

0:14:02.040 --> 0:14:05.400
<v Speaker 13>China does cut off access to these two different metals,

0:14:05.440 --> 0:14:08.360
<v Speaker 13>that it will just simply accelerate other country's efforts to

0:14:09.360 --> 0:14:10.479
<v Speaker 13>find alternatives.

0:14:10.720 --> 0:14:13.520
<v Speaker 12>And we have seen that happen before when China kind

0:14:13.559 --> 0:14:14.239
<v Speaker 12>of ramped.

0:14:14.040 --> 0:14:18.680
<v Speaker 13>Up its restriction exports of rare earth previously, and simply

0:14:18.760 --> 0:14:20.960
<v Speaker 13>what happened was it diminished its own market share in

0:14:21.040 --> 0:14:21.400
<v Speaker 13>the world.

0:14:21.680 --> 0:14:23.000
<v Speaker 12>Now, that takes some time.

0:14:22.920 --> 0:14:24.920
<v Speaker 13>To happen, you know, over a decade or more, to

0:14:25.000 --> 0:14:28.920
<v Speaker 13>fully move away from Chinese supplies of rare earths and

0:14:28.960 --> 0:14:32.320
<v Speaker 13>minerals and so on. The other sort of consequence, potentially

0:14:32.680 --> 0:14:35.920
<v Speaker 13>economically is if the US then does respond in Kine

0:14:36.000 --> 0:14:37.680
<v Speaker 13>and we see a ratting up of this tip for

0:14:37.760 --> 0:14:41.040
<v Speaker 13>tats Mat that Matthew points to, that that longer term,

0:14:41.480 --> 0:14:44.600
<v Speaker 13>you know, those restrictions to developing its strategic technology and

0:14:44.720 --> 0:14:48.600
<v Speaker 13>so on, that does also hobble economic recovery more broadly.

0:14:49.440 --> 0:14:51.280
<v Speaker 12>So those are these two elements here.

0:14:53.160 --> 0:14:56.160
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