1 00:00:02,520 --> 00:00:07,040 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:09,560 --> 00:00:10,000 Speaker 2: This is the. 3 00:00:09,960 --> 00:00:13,320 Speaker 3: Blueberg daybreak Up podcast, available every morning on Apple, Spotify 4 00:00:13,400 --> 00:00:16,240 Speaker 3: or wherever you listen. It's Tuesday, the twenty fifth of February. 5 00:00:16,280 --> 00:00:19,079 Speaker 2: Here in London. I'm Caroline Hepge. Coming up today. 6 00:00:19,640 --> 00:00:24,200 Speaker 3: Chump withdraws US condemnation of Russia's invasion of Ukraine, opting 7 00:00:24,239 --> 00:00:28,000 Speaker 3: instead to align with Moscow. The US looks to impose 8 00:00:28,120 --> 00:00:32,560 Speaker 3: more limits on China's access to semiconductors. Plus, the Sound 9 00:00:32,600 --> 00:00:36,760 Speaker 3: of Silence artists including Annie Lennox and Damon Auburn released 10 00:00:36,760 --> 00:00:41,680 Speaker 3: an album Devoid of Music in protest against AI copyright proposals. 11 00:00:42,200 --> 00:00:44,680 Speaker 3: Let's start with a roundup of our top stories. The 12 00:00:44,800 --> 00:00:48,400 Speaker 3: US has joined Russia in voting against a European backed 13 00:00:48,440 --> 00:00:52,600 Speaker 3: resolution at the UN. The two sides later aligned for 14 00:00:52,680 --> 00:00:55,840 Speaker 3: the first time since the war started to approve a 15 00:00:56,000 --> 00:00:59,560 Speaker 3: US resolution calling for a swift end to the conflict, 16 00:00:59,600 --> 00:01:03,880 Speaker 3: but without assigning blame. This comes as French presidents Emandue 17 00:01:03,920 --> 00:01:07,600 Speaker 3: and Macon visited Trump at the White House. Speaking alongside 18 00:01:07,640 --> 00:01:10,240 Speaker 3: the US President, Macron sought to make the case for 19 00:01:10,360 --> 00:01:14,360 Speaker 3: deeper European involvement in any peace deal. His words are 20 00:01:14,360 --> 00:01:15,559 Speaker 3: spoken by a translator. 21 00:01:16,360 --> 00:01:20,080 Speaker 4: I've spoken with some thirty European leaders and allies in 22 00:01:20,120 --> 00:01:23,840 Speaker 4: recent days. We want to bring together these allies and 23 00:01:23,920 --> 00:01:27,319 Speaker 4: share the same vision. This piece must not mean a 24 00:01:27,400 --> 00:01:31,760 Speaker 4: surrender of Ukraine. It must not mean a ceasefire without guarantees. 25 00:01:32,160 --> 00:01:37,080 Speaker 4: This peace must allow for Ukrainian sovereignty and allow Ukraine 26 00:01:37,120 --> 00:01:40,399 Speaker 4: to negotiate with other stakeholders regarding the. 27 00:01:40,400 --> 00:01:41,880 Speaker 2: Issues it affects. 28 00:01:42,000 --> 00:01:45,080 Speaker 4: But it is also a country in which we need 29 00:01:45,080 --> 00:01:49,360 Speaker 4: to shoulder our responsibilities so that we ensure security and 30 00:01:49,400 --> 00:01:52,480 Speaker 4: stability for Ukraine and for the entire region and for 31 00:01:52,640 --> 00:01:55,360 Speaker 4: US Europeans. This is an existential issue. 32 00:01:56,680 --> 00:02:01,160 Speaker 3: But despite Macron's words, Chump on Monday to speed ahead 33 00:02:01,160 --> 00:02:04,000 Speaker 3: with his own plans to end the war without input 34 00:02:04,040 --> 00:02:07,960 Speaker 3: from European nations or Ukraine, saying on social media that 35 00:02:08,000 --> 00:02:13,680 Speaker 3: he's in quote serious discussions with Russian President Vladimir Putin. Separately, 36 00:02:13,720 --> 00:02:17,080 Speaker 3: President Trump says that Ukraine's Vlodomir Zelenski may travel to 37 00:02:17,240 --> 00:02:20,480 Speaker 3: Washington as soon as this week to sign a deal 38 00:02:20,840 --> 00:02:26,480 Speaker 3: over natural resources. Germany's Chancellor in waiting, Friedrich Mertz, meanwhile, 39 00:02:26,520 --> 00:02:30,040 Speaker 3: is in talks with the Social Democrats to approve up 40 00:02:30,080 --> 00:02:34,000 Speaker 3: to two hundred billion euros in special defense spending. Bloomberg 41 00:02:34,080 --> 00:02:37,960 Speaker 3: understands that officials from Mertz's Christian Democrats and the SPD 42 00:02:38,480 --> 00:02:42,200 Speaker 3: are discussing ways to get around Germany's type restrictions on 43 00:02:42,280 --> 00:02:45,680 Speaker 3: government boring in order to ramp up investment in the 44 00:02:45,760 --> 00:02:50,079 Speaker 3: German military. Ideas under discussion include a special fund for 45 00:02:50,680 --> 00:02:55,080 Speaker 3: the new military spending and Ukraine aid or adapting the 46 00:02:55,120 --> 00:02:58,640 Speaker 3: so called debt break to allow for more defense spending. 47 00:03:00,440 --> 00:03:04,160 Speaker 3: Donald Trump is planning to toughen Biden era controls over 48 00:03:04,320 --> 00:03:08,200 Speaker 3: China's tech sector. The president's team is sketching out more 49 00:03:08,240 --> 00:03:13,280 Speaker 3: restrictive US semiconductor curbs and pressuring key allies to escalate 50 00:03:13,360 --> 00:03:17,359 Speaker 3: their own restrictions on the country. Bimberg understands US officials 51 00:03:17,400 --> 00:03:21,880 Speaker 3: recently met with Dutch and Japanese counterparts to discuss preventing 52 00:03:22,000 --> 00:03:29,120 Speaker 3: Tokyo Conductor and ASML engineers from maintaining semiconductor gear in China. 53 00:03:30,040 --> 00:03:35,480 Speaker 3: Andy Buden, equity investment director at Capital Group, says that 54 00:03:35,680 --> 00:03:39,080 Speaker 3: China's broader prospects, though are still positive. 55 00:03:39,560 --> 00:03:41,360 Speaker 5: The one thing that we can be sure of with 56 00:03:41,560 --> 00:03:43,600 Speaker 5: China is that it is going to be a volatile 57 00:03:43,680 --> 00:03:47,680 Speaker 5: market and I would strongly encourage investors to really think 58 00:03:47,720 --> 00:03:49,839 Speaker 5: about which of the companies that will do well over 59 00:03:49,880 --> 00:03:52,880 Speaker 5: the longer term. But of course, we absolutely are going 60 00:03:52,920 --> 00:03:56,520 Speaker 5: to see a lot of newsflow on tariffs on geopolitics. 61 00:03:56,560 --> 00:03:58,960 Speaker 5: Investors just need to be ready for that and stay 62 00:03:58,960 --> 00:04:00,680 Speaker 5: focused on the long term. 63 00:04:01,200 --> 00:04:04,960 Speaker 3: Capital groups and Debardens speaking THEBS also say that early 64 00:04:05,000 --> 00:04:09,360 Speaker 3: discussions about sanctions on specific Chinese companies are also taking 65 00:04:09,360 --> 00:04:13,320 Speaker 3: place in Washington, as well as curbs on China. Trump's 66 00:04:13,360 --> 00:04:18,279 Speaker 3: administration is also going forward with scheduled tariffs. The president 67 00:04:18,400 --> 00:04:22,440 Speaker 3: said that the levees were coming soon despite an initial delay. 68 00:04:23,040 --> 00:04:25,839 Speaker 6: We're on time with the tariffs, and it seems like 69 00:04:25,920 --> 00:04:29,800 Speaker 6: that's moving along very rapidly. We've been mistreated very badly 70 00:04:29,839 --> 00:04:34,040 Speaker 6: by many countries, not just Canada and Mexico. We've been 71 00:04:34,080 --> 00:04:37,440 Speaker 6: taken advantage of, we were led by in some cases falls. 72 00:04:38,800 --> 00:04:41,440 Speaker 3: Donald Trump went on to add that the US Commerce 73 00:04:41,480 --> 00:04:44,839 Speaker 3: Department is currently calculating the rate it will impose on 74 00:04:44,960 --> 00:04:49,440 Speaker 3: other countries and aiming to incorporate both tariffs and other 75 00:04:49,600 --> 00:04:51,520 Speaker 3: barriers on US imports. 76 00:04:52,120 --> 00:04:53,440 Speaker 2: Following the president's. 77 00:04:53,000 --> 00:04:55,919 Speaker 3: Remarks, though, an anonymous US officials said that the fate 78 00:04:56,000 --> 00:04:59,520 Speaker 3: of a proposed special twenty five percent levee on Canada 79 00:04:59,600 --> 00:05:05,000 Speaker 3: and mex is yet to be determined. The European Union 80 00:05:05,080 --> 00:05:07,640 Speaker 3: is expanding the list of US goods that it will 81 00:05:07,680 --> 00:05:11,840 Speaker 3: target with retaliatory tariffs. Bloomberg's that the Block is broadening 82 00:05:11,839 --> 00:05:15,280 Speaker 3: its plans to respond to US President Donald Trump's planned 83 00:05:15,400 --> 00:05:19,880 Speaker 3: levees on steel and aluminium exports. The US measures could 84 00:05:20,040 --> 00:05:24,080 Speaker 3: impact twenty eight billion euros worth of European exports. That 85 00:05:24,279 --> 00:05:27,720 Speaker 3: is four times more than the last time President Trump 86 00:05:27,760 --> 00:05:33,440 Speaker 3: went after the block's metals sector. The European Union is 87 00:05:33,480 --> 00:05:37,080 Speaker 3: about to walk back key pillars of its planned ESG rules. 88 00:05:37,320 --> 00:05:41,159 Speaker 3: Sustainability drives have been blamed by some business figures for 89 00:05:41,240 --> 00:05:44,520 Speaker 3: holding back the EU's efforts to compete with the US 90 00:05:44,520 --> 00:05:47,440 Speaker 3: and Asia. Bloomberg's James Walcock has Moore now. 91 00:05:47,800 --> 00:05:51,440 Speaker 7: The EU has long plans to make companies legally liable 92 00:05:51,560 --> 00:05:54,960 Speaker 7: if their supply chains are found to contain ESG breaches, 93 00:05:55,440 --> 00:05:58,640 Speaker 7: but documents seen by Bloomberg say the planned rules are 94 00:05:58,680 --> 00:06:02,960 Speaker 7: being redrafted Now only large companies will be targeted, they're 95 00:06:02,960 --> 00:06:06,440 Speaker 7: only responsible for direct business partners, and the finds will 96 00:06:06,440 --> 00:06:10,760 Speaker 7: be lower. The major watering down of arguably the EU's 97 00:06:10,880 --> 00:06:14,960 Speaker 7: flagship ESG policy that in turn shows how member countries 98 00:06:15,000 --> 00:06:18,440 Speaker 7: are lobbying hard for deregulation in response to the wave 99 00:06:18,560 --> 00:06:22,440 Speaker 7: of American loosening rules. The final proposal is set to 100 00:06:22,440 --> 00:06:24,520 Speaker 7: be made public tomorrow in London. 101 00:06:24,680 --> 00:06:26,400 Speaker 2: Jase Walcock, Bloomberg Radio. 102 00:06:27,120 --> 00:06:29,400 Speaker 3: Those are our top stories for you this morning. Let's 103 00:06:29,400 --> 00:06:32,560 Speaker 3: think about the markets. Yesterday, European equities entered in the red. 104 00:06:32,600 --> 00:06:36,479 Speaker 3: The xetradacs though outperformed after the German election, ending up 105 00:06:36,560 --> 00:06:39,000 Speaker 3: zero point six percent. There was also a new closing 106 00:06:39,120 --> 00:06:42,839 Speaker 3: high for Ryan Mittel, up six point four percent. Key 107 00:06:42,880 --> 00:06:46,520 Speaker 3: defense sector name German thirty year bond yields also traded week, 108 00:06:46,800 --> 00:06:49,600 Speaker 3: rising three basis points the news that the new government 109 00:06:49,720 --> 00:06:53,560 Speaker 3: is planning this two hundred billion euro defense fund. Meanwhile, 110 00:06:53,640 --> 00:06:57,359 Speaker 3: US stocks fell in late trading. The Canadian dollar and 111 00:06:57,400 --> 00:07:01,080 Speaker 3: Mexican peso also dropped after Trump toalked about those tariffs 112 00:07:01,160 --> 00:07:06,719 Speaker 3: going ahead next month. As for overnight tonight, US stock 113 00:07:06,760 --> 00:07:10,880 Speaker 3: futures currently are up MCI Asia Pacific index slumping the 114 00:07:10,920 --> 00:07:13,720 Speaker 3: most in three weeks. The reports that again the Trump 115 00:07:13,760 --> 00:07:16,960 Speaker 3: team is doing tough and chip exports to China that 116 00:07:17,080 --> 00:07:20,320 Speaker 3: has affected the hang saying Tech index Japanese stocks have 117 00:07:20,360 --> 00:07:22,640 Speaker 3: reopened after a holiday, with the NIK two two five 118 00:07:22,680 --> 00:07:25,200 Speaker 3: down one point two percent this morning. Treasury yield to 119 00:07:25,200 --> 00:07:29,560 Speaker 3: continue to decline now, and the US dollar is actually steady, 120 00:07:29,680 --> 00:07:32,760 Speaker 3: with Euro trading at one sports zero four seven to seven. 121 00:07:32,920 --> 00:07:35,400 Speaker 3: So those other markets were coming up. Next, we're going 122 00:07:35,480 --> 00:07:37,400 Speaker 3: to talk about what's been coming out of the White House, 123 00:07:37,440 --> 00:07:41,920 Speaker 3: also those votes in the UN yesterday. Our senior editor 124 00:07:42,080 --> 00:07:44,640 Speaker 3: for US Economics and Government, Derek Warbank, will be joining 125 00:07:44,640 --> 00:07:48,400 Speaker 3: me in just a moment, but perhaps a little lighter note. 126 00:07:48,400 --> 00:07:51,520 Speaker 3: This story caught my eye today. It's awards season. Have 127 00:07:51,600 --> 00:07:54,280 Speaker 3: you noticed there's a lovely piece on the terminal from 128 00:07:54,560 --> 00:07:58,400 Speaker 3: Max Berlinger, who writes often for Bloomberg Pursuits. This one's 129 00:07:58,440 --> 00:08:01,480 Speaker 3: called a day in the Life of an Oscar stylist. 130 00:08:01,640 --> 00:08:05,600 Speaker 3: Apparently dressing celebrities has become a cottage industry, and those 131 00:08:05,640 --> 00:08:07,120 Speaker 3: who at the top of their game this is the 132 00:08:07,120 --> 00:08:11,960 Speaker 3: bit that interested me. Their incomes can vary very drastically 133 00:08:12,000 --> 00:08:14,560 Speaker 3: depending on you know, which client or prospect they have, 134 00:08:14,920 --> 00:08:18,600 Speaker 3: but apparently customers who use stylists and often pay for 135 00:08:18,840 --> 00:08:19,200 Speaker 3: the look. 136 00:08:19,280 --> 00:08:21,840 Speaker 2: So it's by look that you pay for. 137 00:08:22,080 --> 00:08:25,800 Speaker 3: And apparently also the fee generally ranges from between one 138 00:08:25,840 --> 00:08:28,920 Speaker 3: thousand to five thousand dollars for preparing you know, an 139 00:08:28,960 --> 00:08:31,720 Speaker 3: actor maybe to do a TV talk show or go 140 00:08:31,760 --> 00:08:35,000 Speaker 3: to a premiere or do an interview. In some cases though, 141 00:08:35,000 --> 00:08:37,480 Speaker 3: the deals then are struck for the whole of a 142 00:08:37,559 --> 00:08:41,760 Speaker 3: particular press cycle. I mean, now for the Oscars, there 143 00:08:41,840 --> 00:08:44,200 Speaker 3: is you know, a campaign season if it's the Oscars 144 00:08:44,280 --> 00:08:46,160 Speaker 3: or the Emmys or the Grammys. Anyway, is a really 145 00:08:46,240 --> 00:08:48,520 Speaker 3: nice piece for Max burling it. It's also on the 146 00:08:48,520 --> 00:08:52,079 Speaker 3: front of the Bloomberg dot co dot UK website if 147 00:08:52,080 --> 00:08:55,800 Speaker 3: you're interested in reading that Bloomberg pursuits something lighter, and 148 00:08:55,840 --> 00:08:57,920 Speaker 3: of course the Oscars if you're thinking about it coming 149 00:08:58,000 --> 00:09:00,960 Speaker 3: up on the third of March, isn't it right? Let's 150 00:09:00,960 --> 00:09:03,600 Speaker 3: turn our attention to our top story. This morning, President 151 00:09:03,640 --> 00:09:07,960 Speaker 3: Trump had cemented Washington split from allies over Ukraine. The 152 00:09:08,040 --> 00:09:11,200 Speaker 3: US and Russia voted together in the UN General Assembly 153 00:09:11,280 --> 00:09:14,240 Speaker 3: and the Security Council, calling for an end to the 154 00:09:14,240 --> 00:09:19,080 Speaker 3: conflict in Ukraine, but without condemning Russian aggression yesterday. Joining 155 00:09:19,160 --> 00:09:20,920 Speaker 3: US now has been a big senior editor for US 156 00:09:21,040 --> 00:09:24,560 Speaker 3: Economics and Government. Derek Warbang, Good morning, Derek, Thank you 157 00:09:24,600 --> 00:09:26,439 Speaker 3: for being with us to help us think through this. 158 00:09:26,840 --> 00:09:29,240 Speaker 3: President Trump is now aligning, it would seem, with Russias 159 00:09:29,280 --> 00:09:34,120 Speaker 3: Vladimir Putin on Europe's worst conflict since the Second World War. 160 00:09:34,600 --> 00:09:38,359 Speaker 3: What happened at the UN and what was President Trump's explanation? 161 00:09:39,720 --> 00:09:43,280 Speaker 8: Well, Caroline, it was a stunning series of events at 162 00:09:43,280 --> 00:09:47,160 Speaker 8: the United Nations. Look, the United States and Russia agreeing 163 00:09:47,400 --> 00:09:53,199 Speaker 8: on any resolutions in this would be something something quite 164 00:09:53,200 --> 00:09:57,640 Speaker 8: to say, but certainly voting against most of the rest 165 00:09:57,640 --> 00:10:02,520 Speaker 8: of the world on a resolution condemning Russia was something 166 00:10:02,559 --> 00:10:04,680 Speaker 8: that a lot of people had not expected to see. 167 00:10:04,720 --> 00:10:08,440 Speaker 8: We did see some explanation from the United States later, 168 00:10:08,800 --> 00:10:12,440 Speaker 8: Marco Rubio, the Secretary of State, telling a conservative website Breitbart, 169 00:10:12,520 --> 00:10:16,920 Speaker 8: that something in the verge of that they were looking 170 00:10:17,960 --> 00:10:20,559 Speaker 8: at move forward, not looking back. Everyone can read the 171 00:10:20,600 --> 00:10:22,880 Speaker 8: papers and see what started the war, et cetera, et cetera. 172 00:10:23,920 --> 00:10:27,560 Speaker 8: This idea of like preserving some negotiating space and not 173 00:10:27,720 --> 00:10:30,400 Speaker 8: antagonizing and things of that nature. But even that is 174 00:10:30,760 --> 00:10:34,120 Speaker 8: a remarkable sort of come down for the US administration 175 00:10:34,200 --> 00:10:37,400 Speaker 8: and very much I think emphasizes the point that we've 176 00:10:37,440 --> 00:10:39,920 Speaker 8: heard a lot of Europeans make. I mean, I've talked 177 00:10:39,920 --> 00:10:42,240 Speaker 8: to a lot of European diplomats in last week over 178 00:10:42,280 --> 00:10:46,960 Speaker 8: here in Singapore, and they're all telling me that, regardless 179 00:10:46,960 --> 00:10:49,960 Speaker 8: of whatever you think of the US moves right now, 180 00:10:50,000 --> 00:10:52,800 Speaker 8: they make very very plain that if Europe wants to 181 00:10:52,880 --> 00:10:56,000 Speaker 8: defend Europe, it needs to defend Europe and not wait 182 00:10:56,040 --> 00:10:58,439 Speaker 8: for the United States to be around, because you cannot 183 00:10:58,440 --> 00:11:01,600 Speaker 8: make the calculus in their view that the United States 184 00:11:01,640 --> 00:11:02,520 Speaker 8: will be around. 185 00:11:03,400 --> 00:11:06,199 Speaker 3: Yeah. Meanwhile, the French president was at the White House 186 00:11:06,280 --> 00:11:09,560 Speaker 3: kissed Armer. The UK Prime minister will be there on Thursday. 187 00:11:09,600 --> 00:11:15,160 Speaker 3: We think will then take responsibility for guaranteeing Ukraine's future security. 188 00:11:15,240 --> 00:11:16,520 Speaker 2: That is a really big question. 189 00:11:17,280 --> 00:11:22,480 Speaker 8: Well, we've talked before about Emmanuel Macron's once more into 190 00:11:22,480 --> 00:11:24,920 Speaker 8: the breach, the sort of efforts here, right, you know, 191 00:11:25,200 --> 00:11:27,760 Speaker 8: he's sort of seeing a situation where he doesn't think 192 00:11:27,800 --> 00:11:29,720 Speaker 8: that Europe has a seat at the table and going 193 00:11:29,760 --> 00:11:33,520 Speaker 8: and inserting himself and giving himself that seat. Macron has 194 00:11:33,520 --> 00:11:35,760 Speaker 8: certainly been the top one on this, but we've heard 195 00:11:36,320 --> 00:11:40,160 Speaker 8: from Friedrich Marzen, the new winner in Germany who's looking 196 00:11:40,160 --> 00:11:43,439 Speaker 8: to form his own coalition, saying, you know, very similar 197 00:11:43,480 --> 00:11:47,000 Speaker 8: things that Europe needed to step up so that I 198 00:11:47,040 --> 00:11:51,400 Speaker 8: would expect, I would expect to continue. You've certainly seen 199 00:11:52,080 --> 00:11:56,360 Speaker 8: similar language before from Czirkuios Starmer, So I would expect 200 00:11:56,400 --> 00:11:59,040 Speaker 8: a little bit of a united front among the major 201 00:11:59,120 --> 00:12:04,800 Speaker 8: European powers plus the UK as they're trying to align here. 202 00:12:05,760 --> 00:12:07,360 Speaker 8: I think they're all sort of singing out of the 203 00:12:07,360 --> 00:12:08,199 Speaker 8: same song sheet. 204 00:12:09,200 --> 00:12:12,040 Speaker 3: Putin has also welcomed this reset. He made some comments 205 00:12:12,080 --> 00:12:15,200 Speaker 3: on Russian TV. I mean, it's also noteworthy, isn't it 206 00:12:15,240 --> 00:12:17,800 Speaker 3: that in the Security Council it was Russia, at the 207 00:12:17,880 --> 00:12:20,680 Speaker 3: US and China that all voted for that measure. 208 00:12:21,400 --> 00:12:23,640 Speaker 8: Well, no surprise that he's happy right now. I did 209 00:12:23,679 --> 00:12:25,959 Speaker 8: read some of the comments that he was making. Some 210 00:12:27,120 --> 00:12:30,439 Speaker 8: of the suggestions, such as that the US could maybe 211 00:12:30,440 --> 00:12:34,080 Speaker 8: help Russia explore mineral rights in the bits of Ukraine 212 00:12:34,080 --> 00:12:37,680 Speaker 8: that Russia is currently occupying, are probably not going to 213 00:12:37,720 --> 00:12:42,520 Speaker 8: be welcomed in the US, I would imagine. But Putin 214 00:12:42,600 --> 00:12:45,720 Speaker 8: is certainly finding himself in a different position. That having 215 00:12:45,760 --> 00:12:48,520 Speaker 8: been said, there are trip hazards to this position. Look, 216 00:12:48,800 --> 00:12:52,920 Speaker 8: US officials have said. Trump appointed US officials have said 217 00:12:53,360 --> 00:12:56,440 Speaker 8: that they are open to easing on Russia, but they're 218 00:12:56,480 --> 00:13:01,640 Speaker 8: also open to being stricter with Russia if Russia is not, 219 00:13:02,960 --> 00:13:05,400 Speaker 8: you know, willing to actually go into talks, and so 220 00:13:05,440 --> 00:13:08,400 Speaker 8: far mister Putin has not necessarily shown a giant willingness 221 00:13:08,400 --> 00:13:11,920 Speaker 8: to get into talks in a serious way. And so 222 00:13:12,280 --> 00:13:15,199 Speaker 8: if that happens, if you go through all of this exercise, 223 00:13:15,240 --> 00:13:18,120 Speaker 8: you say, here's the most favorable set of circumstances you 224 00:13:18,160 --> 00:13:21,679 Speaker 8: possibly could have wanted, and that's still not good enough 225 00:13:21,760 --> 00:13:25,120 Speaker 8: for you. There is a possibility that at some point 226 00:13:25,200 --> 00:13:30,640 Speaker 8: this warmth turns to frigidity, and in a real way. 227 00:13:30,400 --> 00:13:33,439 Speaker 8: So there is a danger here of sometimes you get 228 00:13:33,440 --> 00:13:37,240 Speaker 8: into a familiar into like this friendly confines and it 229 00:13:37,280 --> 00:13:41,320 Speaker 8: seems very comfortable. That may not last forever. And that's 230 00:13:41,360 --> 00:13:43,760 Speaker 8: something that Vladimir Putin is going to have to take 231 00:13:43,840 --> 00:13:44,640 Speaker 8: quite seriously. 232 00:13:45,880 --> 00:13:48,760 Speaker 3: In terms of how investors think about this. I mean, 233 00:13:48,960 --> 00:13:52,120 Speaker 3: this is this is geopolitics. It's husually important, you know, 234 00:13:52,280 --> 00:13:56,480 Speaker 3: with thinking about what feels like a really tectonic shift, 235 00:13:56,600 --> 00:14:00,720 Speaker 3: doesn't it in terms of the US's alliance it is. Derek, 236 00:14:00,760 --> 00:14:03,480 Speaker 3: can you give me a thought on how investors might 237 00:14:03,559 --> 00:14:06,800 Speaker 3: be thinking about this? Businesses around the world as we 238 00:14:06,880 --> 00:14:09,679 Speaker 3: have to, you know, take time to kind of recalibrate. 239 00:14:10,640 --> 00:14:13,320 Speaker 8: Sure, look, My favorite thing to say about all of this, 240 00:14:13,559 --> 00:14:16,600 Speaker 8: honestly at any point is price in volatility. Right, if 241 00:14:16,800 --> 00:14:18,679 Speaker 8: that's the number one thing that you can be certain 242 00:14:18,760 --> 00:14:22,160 Speaker 8: of is increased volatility. So I think that's certainly something 243 00:14:22,160 --> 00:14:25,640 Speaker 8: that we're seeing in there. I read an interesting quote 244 00:14:25,920 --> 00:14:28,880 Speaker 8: in a Bloomberg story the other week that basically that 245 00:14:29,040 --> 00:14:31,080 Speaker 8: was talking about the oil market and was talking about 246 00:14:31,080 --> 00:14:36,520 Speaker 8: how how basically it's it's going kind of nowhere, but 247 00:14:36,560 --> 00:14:39,440 Speaker 8: in the most volatile, well way possible. I think you 248 00:14:39,480 --> 00:14:41,000 Speaker 8: see that in a lot of different things. 249 00:14:41,080 --> 00:14:41,240 Speaker 9: Right. 250 00:14:41,480 --> 00:14:43,800 Speaker 8: You see a lot of currencies that are moving by 251 00:14:43,880 --> 00:14:46,760 Speaker 8: quite substantial amounts that maybe they haven't moved that way 252 00:14:46,800 --> 00:14:49,840 Speaker 8: in months, maybe years, and you see all of this 253 00:14:50,000 --> 00:14:52,120 Speaker 8: up and down. So I think that's the number one thing. 254 00:14:52,520 --> 00:14:55,520 Speaker 8: There is a certain dividend to make if Europe gets 255 00:14:55,520 --> 00:14:58,120 Speaker 8: to a durable peace, right, you know, that's been something 256 00:14:58,160 --> 00:15:02,080 Speaker 8: that's been hanging, but is something that may not. My 257 00:15:02,120 --> 00:15:05,560 Speaker 8: good friend Josh Rogan over at WP Intelligence was writing 258 00:15:05,840 --> 00:15:10,280 Speaker 8: that he sees he sees European defense as a as 259 00:15:10,800 --> 00:15:13,120 Speaker 8: a play that some people are looking at here, because 260 00:15:13,160 --> 00:15:17,360 Speaker 8: if Europe is actually going forward with staffing up its defense, 261 00:15:17,440 --> 00:15:20,520 Speaker 8: then then certainly that money is going to go somewhere. 262 00:15:21,240 --> 00:15:22,960 Speaker 8: So there are a lot of different ways that this 263 00:15:23,000 --> 00:15:26,440 Speaker 8: can play, and I think somewhat durably, but it all Caroline, 264 00:15:26,480 --> 00:15:28,920 Speaker 8: It all comes back to me for volatility in an 265 00:15:28,920 --> 00:15:32,600 Speaker 8: age of Trump, you have to be prepared to be surprised. 266 00:15:33,440 --> 00:15:36,280 Speaker 3: Derek, thank you so much. Yes, that's a good point, 267 00:15:36,360 --> 00:15:39,560 Speaker 3: isn't it. And as alegra Stratton pointed out yesterday in 268 00:15:39,880 --> 00:15:42,680 Speaker 3: the Readout newsletter, if you read that, you know, going 269 00:15:42,720 --> 00:15:45,360 Speaker 3: from not having to pay for defense spending then to 270 00:15:45,400 --> 00:15:47,400 Speaker 3: having to factor in a cost for Europe is also 271 00:15:47,440 --> 00:15:48,480 Speaker 3: a huge change. 272 00:15:48,600 --> 00:15:50,440 Speaker 2: Derek, great to speak to you. Thank you for being 273 00:15:50,480 --> 00:15:50,680 Speaker 2: with me. 274 00:15:50,760 --> 00:15:57,200 Speaker 3: Plympig's senior editor for US Economics and Government, Derek Wallbank. Now, 275 00:15:57,280 --> 00:16:01,320 Speaker 3: more than a thousand musicians are really seeing a silent 276 00:16:01,560 --> 00:16:04,600 Speaker 3: album to protest a proposed change in the law here 277 00:16:04,640 --> 00:16:07,400 Speaker 3: in the UK, which they say will allow tech firms 278 00:16:07,440 --> 00:16:11,640 Speaker 3: to train AI models on their copyrighted work more easily. 279 00:16:11,640 --> 00:16:13,200 Speaker 2: Polemics here Ada Bio joins me. 280 00:16:13,320 --> 00:16:16,480 Speaker 3: Now for more on this story, Ti, what is the 281 00:16:16,560 --> 00:16:18,760 Speaker 3: UK government planning to change here? 282 00:16:19,280 --> 00:16:22,560 Speaker 9: Well, they're planning to change copyright law and crucially that 283 00:16:22,640 --> 00:16:25,520 Speaker 9: will make it easier for AI companies and actually other 284 00:16:25,600 --> 00:16:29,560 Speaker 9: tech firms to use copyrighted work to train their models 285 00:16:29,840 --> 00:16:32,960 Speaker 9: without a license. It's not just music, it's everything from 286 00:16:33,040 --> 00:16:36,920 Speaker 9: literature to journalism, basically everything that is in the public 287 00:16:36,960 --> 00:16:39,960 Speaker 9: domain of the Internet. So developers will be able to 288 00:16:40,080 --> 00:16:45,320 Speaker 9: use creators' content to develop their models under the new rules. 289 00:16:45,520 --> 00:16:49,360 Speaker 9: That's unless creators opt out through something called rights reservation. 290 00:16:49,960 --> 00:16:53,120 Speaker 9: But critics are saying that in practice this opt out 291 00:16:53,200 --> 00:16:57,200 Speaker 9: system would be incredibly impractical and very labor intensive and 292 00:16:57,240 --> 00:17:00,880 Speaker 9: actually virtually impossible when you think about the size and 293 00:17:01,000 --> 00:17:02,520 Speaker 9: scope of the Internet. 294 00:17:02,640 --> 00:17:05,000 Speaker 2: So there has been an alternative. 295 00:17:04,400 --> 00:17:06,879 Speaker 9: Proposal in the House of Lords of Artists to opt 296 00:17:06,880 --> 00:17:10,960 Speaker 9: in instead. But thinking about the consequences of these laws 297 00:17:11,000 --> 00:17:13,760 Speaker 9: are quite far reaching. So the content could also be 298 00:17:13,880 --> 00:17:17,400 Speaker 9: used for companies for data mining and actually even as 299 00:17:17,480 --> 00:17:21,280 Speaker 9: a basis to generate new content, and that's why the 300 00:17:21,359 --> 00:17:24,800 Speaker 9: law has been going through something called a consultation period 301 00:17:24,960 --> 00:17:27,120 Speaker 9: in the UK, which actually ends today. 302 00:17:27,600 --> 00:17:28,679 Speaker 2: It's received some. 303 00:17:28,600 --> 00:17:33,480 Speaker 9: Quite high profile criticism, especially from figures in the music industry, 304 00:17:33,480 --> 00:17:36,880 Speaker 9: including the likes of Paul McCartney and Elton John And then, 305 00:17:36,920 --> 00:17:39,440 Speaker 9: of course, as you mentioned, there is this silent album 306 00:17:40,000 --> 00:17:43,360 Speaker 9: released today called This Is What we want. It's for charity, 307 00:17:43,640 --> 00:17:47,159 Speaker 9: includes artists like Annie Lennox and Kate Bush, and it 308 00:17:47,200 --> 00:17:51,760 Speaker 9: features recordings of empty studio space and other performance spaces. 309 00:17:52,840 --> 00:17:56,200 Speaker 9: And the track list actually spells out the British government 310 00:17:56,359 --> 00:18:00,560 Speaker 9: must not legalize music theft to benefit AI company. So 311 00:18:00,600 --> 00:18:02,600 Speaker 9: I think it's fair to say they're not happy about 312 00:18:02,600 --> 00:18:03,119 Speaker 9: the changes. 313 00:18:03,920 --> 00:18:06,679 Speaker 3: Okay, So this is the proposal then, and the pushbag 314 00:18:07,200 --> 00:18:10,480 Speaker 3: has the boat already sailed though in artificial intelligence? I 315 00:18:10,520 --> 00:18:12,520 Speaker 3: mean i'd argue maybe it has. 316 00:18:12,560 --> 00:18:13,040 Speaker 2: In print. 317 00:18:13,200 --> 00:18:15,560 Speaker 3: There are a bunch of lawsuits, aren't there already around 318 00:18:15,840 --> 00:18:19,119 Speaker 3: what print content these AI models can use or have 319 00:18:19,240 --> 00:18:19,760 Speaker 3: been using. 320 00:18:20,320 --> 00:18:23,000 Speaker 9: Well, in a word, yes, And it's a similar case 321 00:18:23,000 --> 00:18:27,120 Speaker 9: in the music industry. They've already faced quite significant issues 322 00:18:27,160 --> 00:18:29,560 Speaker 9: in this field, and they have been doing so for 323 00:18:29,600 --> 00:18:32,040 Speaker 9: a number of years now. Actually, back in April twenty 324 00:18:32,119 --> 00:18:34,919 Speaker 9: twenty four, as the musician Drake, he found himself in 325 00:18:35,000 --> 00:18:38,160 Speaker 9: quite a lot of trouble because he posted a track 326 00:18:38,280 --> 00:18:42,680 Speaker 9: to his social media featuring an AI generated version of 327 00:18:42,840 --> 00:18:44,200 Speaker 9: the rapper Tupac's voice. 328 00:18:44,240 --> 00:18:45,760 Speaker 2: Tupac obviously has passed away. 329 00:18:45,960 --> 00:18:48,480 Speaker 9: So lawyers for Tupacs of State sent a cease and 330 00:18:48,520 --> 00:18:52,680 Speaker 9: desist letter to Drake, and that video later disappeared from 331 00:18:52,680 --> 00:18:56,560 Speaker 9: his social media. But artists like Drake are trying to 332 00:18:56,640 --> 00:19:00,359 Speaker 9: sort of embrace the genre and use it creatively. Drake 333 00:19:00,359 --> 00:19:03,840 Speaker 9: also is no stranger to AI generated music. He actually 334 00:19:03,920 --> 00:19:08,760 Speaker 9: sampled an AI generated song about himself by an Internet 335 00:19:08,840 --> 00:19:12,400 Speaker 9: creator in his own music, So perhaps a bid there 336 00:19:12,760 --> 00:19:16,159 Speaker 9: to sort of take back control. That's one approach, but 337 00:19:16,440 --> 00:19:20,119 Speaker 9: music management groups don't seem to be as willing to 338 00:19:20,320 --> 00:19:24,800 Speaker 9: adopt this technology. Actually, Universal Music Group when they boycotted TikTok, 339 00:19:25,240 --> 00:19:27,800 Speaker 9: they pulled their music catalog from the app. They said 340 00:19:27,840 --> 00:19:31,239 Speaker 9: AI was one of the three main concerns as to 341 00:19:31,560 --> 00:19:36,000 Speaker 9: why they did that. Also, major music labels have sued 342 00:19:36,160 --> 00:19:41,840 Speaker 9: two AI generating music companies for copyright infringement of their recordings, 343 00:19:41,880 --> 00:19:46,120 Speaker 9: and they said it took place at an almost unimaginable scale. 344 00:19:46,200 --> 00:19:50,520 Speaker 9: So it's definitely already a live issue for both artists 345 00:19:50,520 --> 00:19:54,119 Speaker 9: and music management companies. And that's also not to mention 346 00:19:54,400 --> 00:19:59,040 Speaker 9: battles over AI generated images and likenesses of artists and musicians, 347 00:19:59,160 --> 00:20:01,240 Speaker 9: which have a much lo longer legal history too. 348 00:20:01,640 --> 00:20:04,240 Speaker 2: Yeah, Okay, well that's a whole nother section, isn't it. 349 00:20:04,359 --> 00:20:07,280 Speaker 3: Look it's also not a kind of fluffy issue, is 350 00:20:07,320 --> 00:20:10,800 Speaker 3: it in the UK because the creative industries are so important, actually, dibidden, 351 00:20:10,880 --> 00:20:12,320 Speaker 3: and I'm sure to lots of other. 352 00:20:12,200 --> 00:20:13,720 Speaker 2: Places, so definitely. 353 00:20:13,720 --> 00:20:16,720 Speaker 9: In twenty twenty three, for example, the UK music industry 354 00:20:16,760 --> 00:20:21,000 Speaker 9: alone actually contributed a record seven point six billion pounds 355 00:20:21,040 --> 00:20:24,080 Speaker 9: to the economy. And these are the sorts of contributions 356 00:20:24,080 --> 00:20:27,520 Speaker 9: that the government won't want to lose, especially now as 357 00:20:27,520 --> 00:20:30,359 Speaker 9: they're struggling to produce the sort of economic growth that 358 00:20:30,480 --> 00:20:33,600 Speaker 9: perhaps they might want. And I think that's why they've 359 00:20:33,600 --> 00:20:37,280 Speaker 9: committed to this period of consultation to perhaps get music 360 00:20:37,359 --> 00:20:41,679 Speaker 9: industry executives and musicians on side. But they're having a 361 00:20:41,720 --> 00:20:45,320 Speaker 9: tricky time of actually. The CEO of the UK's music 362 00:20:45,400 --> 00:20:49,199 Speaker 9: industry body, UK Music described these changes as the government 363 00:20:49,240 --> 00:20:55,320 Speaker 9: basically taking a punt against an already productive and successful 364 00:20:55,359 --> 00:20:58,440 Speaker 9: industry and for many artists it seems really to just 365 00:20:58,480 --> 00:21:01,800 Speaker 9: be a question of age and see here. Actually, despite 366 00:21:01,840 --> 00:21:05,160 Speaker 9: being a critic of these changes, Paul McCartney, for example, 367 00:21:05,880 --> 00:21:11,040 Speaker 9: he actually has used AI in his music to recreate 368 00:21:11,080 --> 00:21:13,760 Speaker 9: the vocals from an unfinished demo by John Lennon to 369 00:21:13,800 --> 00:21:16,760 Speaker 9: produce a new song, So he's used it, but he's 370 00:21:16,800 --> 00:21:20,679 Speaker 9: a critic of these new changes. It's also important to 371 00:21:20,680 --> 00:21:23,120 Speaker 9: remember that the UK has committed to being a real 372 00:21:23,240 --> 00:21:25,959 Speaker 9: leader in the AI space. It's not long since they 373 00:21:26,040 --> 00:21:30,679 Speaker 9: released their AI Opportunities Action Plan, and this technology is 374 00:21:30,720 --> 00:21:33,919 Speaker 9: being seen as a key driver of economic growth. So 375 00:21:33,960 --> 00:21:36,760 Speaker 9: it could be that this new law, this new change 376 00:21:36,800 --> 00:21:38,720 Speaker 9: of the law is one of the steps that we 377 00:21:38,840 --> 00:21:41,879 Speaker 9: need to get to that place of leadership. But those 378 00:21:42,000 --> 00:21:44,879 Speaker 9: protesting the change definitely don't think it is. 379 00:21:46,000 --> 00:21:48,760 Speaker 1: This is Bloomberg Daybreak Europe. 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