1 00:00:00,280 --> 00:00:07,720 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:10,320 --> 00:00:12,719 Speaker 2: This is Bloomberg day Break Weekend, our global look at 3 00:00:12,720 --> 00:00:14,840 Speaker 2: the top stories in the coming week from our Daybreak 4 00:00:14,880 --> 00:00:17,560 Speaker 2: anchors all around the world. Straight ahead on the program, 5 00:00:17,560 --> 00:00:20,240 Speaker 2: and look ahead to some key data in the US 6 00:00:20,560 --> 00:00:23,759 Speaker 2: how it may impact FED policy moving forward. I'm Tom 7 00:00:23,840 --> 00:00:24,759 Speaker 2: Lusby in New York. 8 00:00:25,120 --> 00:00:28,560 Speaker 3: I'm Kroline, Hepkeitt in London, where we're asking what next 9 00:00:28,760 --> 00:00:30,200 Speaker 3: in the global AI race. 10 00:00:30,760 --> 00:00:34,120 Speaker 4: I'm dek Chrisner looking at the potential fallout of Donald 11 00:00:34,120 --> 00:00:37,040 Speaker 4: Trump's trade war with China. 12 00:00:38,400 --> 00:00:42,440 Speaker 1: That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 13 00:00:42,440 --> 00:00:46,160 Speaker 1: eleven three Yeero, New York, Bloomberg ninety nine to one, Washington, DC, 14 00:00:46,640 --> 00:00:50,880 Speaker 1: Bloomberg ninety two to nine, Boston, DAB Digital Radio, London, 15 00:00:51,320 --> 00:00:54,520 Speaker 1: Sirius XM one twenty one, and around the world on 16 00:00:54,600 --> 00:00:57,760 Speaker 1: Bloomberg Radio, dot Com and the Bloomberg Business App. 17 00:01:02,280 --> 00:01:04,360 Speaker 2: Good day to you. I'm Tom Busby. We begin today's 18 00:01:04,360 --> 00:01:06,800 Speaker 2: program with some key economic data here in the US. 19 00:01:07,440 --> 00:01:12,560 Speaker 2: CPI data on Wednesday, US retail sales on Friday. Now 20 00:01:12,600 --> 00:01:15,160 Speaker 2: for more on these readings, what they tell us about 21 00:01:15,200 --> 00:01:18,600 Speaker 2: the consumer, how they may impact FED policy, moving forward, 22 00:01:18,760 --> 00:01:23,760 Speaker 2: we're joined by Stuart paul Us, economist with Bloomberg Economics. Stuart, 23 00:01:23,760 --> 00:01:26,800 Speaker 2: thank you for being here. Now, before we look ahead, 24 00:01:27,040 --> 00:01:29,320 Speaker 2: let's start with some important data we just got at 25 00:01:29,360 --> 00:01:32,160 Speaker 2: the end of this past week, the January jobs report. 26 00:01:32,400 --> 00:01:35,240 Speaker 2: Why don't you tell us those numbers and how do 27 00:01:35,240 --> 00:01:35,840 Speaker 2: you read this? 28 00:01:36,440 --> 00:01:39,680 Speaker 5: So my read of the January jobs report is that 29 00:01:39,720 --> 00:01:42,240 Speaker 5: it's a bit mixed. The data are a bit mixed. 30 00:01:42,640 --> 00:01:46,119 Speaker 5: Headline job growth actually surprised to the downside. We had 31 00:01:46,120 --> 00:01:49,920 Speaker 5: just one hundred and forty three thousand jobs added in January. 32 00:01:49,960 --> 00:01:53,000 Speaker 5: That's below our estimate about two hundred thousand jobs added 33 00:01:53,080 --> 00:01:56,000 Speaker 5: during the month. And in addition to that, there were 34 00:01:56,080 --> 00:02:00,640 Speaker 5: downward revisions of past month's data. But and this is 35 00:02:00,680 --> 00:02:02,800 Speaker 5: where it gets to be a little bit mixed, the 36 00:02:02,880 --> 00:02:07,200 Speaker 5: downward revisions weren't as steep as we had expected. As 37 00:02:07,240 --> 00:02:10,160 Speaker 5: most of Wall Street had expected, we saw just six 38 00:02:10,240 --> 00:02:13,920 Speaker 5: hundred and ten thousand fewer workers on payrolls at the 39 00:02:14,120 --> 00:02:18,119 Speaker 5: end of twenty twenty four. Most folks were expecting over 40 00:02:18,200 --> 00:02:21,640 Speaker 5: nine hundred thousand fewer workers on payrolls at the end 41 00:02:21,680 --> 00:02:24,640 Speaker 5: of twenty twenty four. So those downward revisions weren't actually 42 00:02:24,680 --> 00:02:28,480 Speaker 5: as steep as folks had expected. Where we did see 43 00:02:29,040 --> 00:02:32,400 Speaker 5: a little bit of negative details were in some of 44 00:02:32,440 --> 00:02:35,040 Speaker 5: the industry level composition of those revisions. So at the 45 00:02:35,080 --> 00:02:37,359 Speaker 5: end of twenty twenty four, there were fewer workers working 46 00:02:37,360 --> 00:02:42,120 Speaker 5: in professional and business services, leisure and hospitality, manufacturing, some 47 00:02:42,200 --> 00:02:45,960 Speaker 5: of those more cyclically sensitive industries. So we take the 48 00:02:46,000 --> 00:02:49,079 Speaker 5: downward revisions, we take the industry level composition, we take 49 00:02:49,160 --> 00:02:52,959 Speaker 5: slowing payroll growth to start twenty twenty five, and it's 50 00:02:53,000 --> 00:02:56,920 Speaker 5: really just not a great picture in terms of the 51 00:02:57,000 --> 00:02:59,960 Speaker 5: labor market right now. It does characterize labor market cool. 52 00:03:00,600 --> 00:03:04,040 Speaker 2: But we did see the unemployment rate move lower. 53 00:03:03,840 --> 00:03:06,520 Speaker 5: That's exactly right. Adding to the mixed nature of this 54 00:03:06,639 --> 00:03:10,400 Speaker 5: job report, we see the unemployment rate inching lower. Some 55 00:03:10,480 --> 00:03:14,880 Speaker 5: of that is because of updates and revisions to how 56 00:03:14,919 --> 00:03:17,480 Speaker 5: the household survey is computed. A lot of it comes 57 00:03:17,520 --> 00:03:21,880 Speaker 5: from revisions or updates to the total population. The estimate 58 00:03:21,880 --> 00:03:24,920 Speaker 5: of the population increased by about three million people, and 59 00:03:24,960 --> 00:03:28,200 Speaker 5: the number of people who the Bureau of Labor Statistics 60 00:03:28,360 --> 00:03:32,840 Speaker 5: estimates are employed increased by way more than we had anticipated. 61 00:03:33,160 --> 00:03:35,480 Speaker 5: That creates downward pressure on the unemployment. 62 00:03:35,120 --> 00:03:38,840 Speaker 2: Where people joining the workforce, unemployment I mean sounds like 63 00:03:40,080 --> 00:03:42,600 Speaker 2: former President Biden left on a pretty high note here. 64 00:03:42,680 --> 00:03:44,720 Speaker 2: If it's four percent unemployment. 65 00:03:44,280 --> 00:03:48,120 Speaker 5: That's right. Adding to his economic legacy of delivering a 66 00:03:48,120 --> 00:03:51,560 Speaker 5: slower pace of inflation without creating a massive disturbance in 67 00:03:51,560 --> 00:03:53,960 Speaker 5: the labor market. That's going to be part of his 68 00:03:54,120 --> 00:03:58,560 Speaker 5: economic legacy. And so again, you know, as he exited 69 00:03:58,640 --> 00:04:02,120 Speaker 5: on the twentieth of January, this is a rather favorable 70 00:04:02,680 --> 00:04:05,560 Speaker 5: little detail for his economic legacy. But in terms of 71 00:04:05,600 --> 00:04:08,360 Speaker 5: the job to report overall, it is a pretty mixed picture. 72 00:04:08,560 --> 00:04:13,000 Speaker 5: Payrolls not looking great, but then again unemployment inching down. 73 00:04:13,680 --> 00:04:18,599 Speaker 2: Now you mentioned inflation and the legacy of former President Biden, 74 00:04:19,240 --> 00:04:20,919 Speaker 2: I mean, it has been the bete noir for this 75 00:04:21,000 --> 00:04:24,520 Speaker 2: economy and for consumers. And what are you expecting to 76 00:04:24,520 --> 00:04:28,400 Speaker 2: see on Wednesday? That would be the January CPI. Everybody 77 00:04:28,400 --> 00:04:30,760 Speaker 2: goes to the gas station, everybody tries to buy eggs 78 00:04:30,800 --> 00:04:34,360 Speaker 2: if there are eggs in there. There's a lot into this. 79 00:04:34,880 --> 00:04:37,200 Speaker 2: What do you expect to see and why? What is 80 00:04:37,240 --> 00:04:38,919 Speaker 2: the reason it is so stubbornly high. 81 00:04:39,040 --> 00:04:42,840 Speaker 5: We're expecting to see headline inflation registering zero point three 82 00:04:42,920 --> 00:04:45,520 Speaker 5: percent on a monthly basis. That's a little bit slower 83 00:04:45,520 --> 00:04:48,680 Speaker 5: than we saw in December. There are a couple tricky 84 00:04:48,839 --> 00:04:53,400 Speaker 5: seasonal factors operating the background that are allowing for that 85 00:04:53,640 --> 00:04:57,800 Speaker 5: slow down in the monthly pace of headline inflation. But 86 00:04:58,120 --> 00:05:01,320 Speaker 5: underneath the surface, what's going on the sumer level for 87 00:05:01,520 --> 00:05:06,080 Speaker 5: headline inflation is that gasoline prices are exceptionally stable through 88 00:05:06,120 --> 00:05:09,279 Speaker 5: the winter. Typically, you would expect to see a major 89 00:05:09,320 --> 00:05:14,159 Speaker 5: decline in December that never materialized that boosted the December number. 90 00:05:14,560 --> 00:05:17,480 Speaker 5: Now as we get into January, there's less of that 91 00:05:17,520 --> 00:05:20,960 Speaker 5: going on again. Just at the pump, things are relatively stable, 92 00:05:21,320 --> 00:05:22,520 Speaker 5: and so we're going to see a little bit of 93 00:05:22,520 --> 00:05:25,200 Speaker 5: a slow down to the pace of headline inflation. When 94 00:05:25,240 --> 00:05:27,800 Speaker 5: it comes to the core, we're also expecting to see 95 00:05:27,880 --> 00:05:32,279 Speaker 5: just barely zero point three percent monthly inflation. That's faster 96 00:05:32,760 --> 00:05:35,600 Speaker 5: than we saw it in December zero point two percent December, 97 00:05:36,120 --> 00:05:39,560 Speaker 5: but favorable base effect will allow the annual measure of 98 00:05:39,600 --> 00:05:42,440 Speaker 5: core inflation to inch down just a little bit to 99 00:05:42,560 --> 00:05:46,560 Speaker 5: three point one percent, still stubbornly high. It's still characteristic 100 00:05:46,600 --> 00:05:50,080 Speaker 5: of that long last mile to the FEDS two percent target, 101 00:05:50,920 --> 00:05:52,760 Speaker 5: And a lot of what's going on in the background 102 00:05:53,200 --> 00:05:57,800 Speaker 5: is that goods disinflation deflation in goods, which is typical 103 00:05:58,200 --> 00:06:02,520 Speaker 5: for the US decade, It's just not there. We're just 104 00:06:02,600 --> 00:06:06,400 Speaker 5: not getting that goods deflation that we would typically rely on. 105 00:06:06,600 --> 00:06:08,760 Speaker 2: Now on Friday, we're gonna see the result of this 106 00:06:08,880 --> 00:06:12,000 Speaker 2: with retail sales for January. What are you expecting to see? 107 00:06:12,480 --> 00:06:15,000 Speaker 2: Is the consumer pulling back? And is it not just 108 00:06:15,160 --> 00:06:17,520 Speaker 2: low way journers but all consumers. 109 00:06:17,960 --> 00:06:21,080 Speaker 5: What I'm really seeing for the retail sales number is 110 00:06:21,120 --> 00:06:27,240 Speaker 5: a consequence of pretty negative weather consequences from the polar vortex. 111 00:06:27,279 --> 00:06:31,479 Speaker 5: In January. We saw really dismal auto sales during the month. 112 00:06:31,720 --> 00:06:34,679 Speaker 5: The annualized pace of auto sales fell to about fifteen 113 00:06:34,720 --> 00:06:38,080 Speaker 5: point six million units from sixteen point eight million units 114 00:06:38,120 --> 00:06:41,919 Speaker 5: in December. So that major decline is characteristic of folks 115 00:06:41,960 --> 00:06:45,160 Speaker 5: who just really don't want to walk the lot and 116 00:06:45,320 --> 00:06:49,120 Speaker 5: get pitched on, you know, the undercoat cealant by the salesman. 117 00:06:49,480 --> 00:06:51,560 Speaker 5: It's just too cold to do that during the month 118 00:06:51,560 --> 00:06:54,320 Speaker 5: of January during a polar vortex. And when you have 119 00:06:54,400 --> 00:06:57,320 Speaker 5: auto sales declining like that, that could result in headline 120 00:06:57,360 --> 00:07:00,240 Speaker 5: retail sales declining by that zero point four percent during 121 00:07:00,240 --> 00:07:02,560 Speaker 5: the month. And that's what we expect well a. 122 00:07:02,480 --> 00:07:05,040 Speaker 2: Lot to look forward to. Our thanks to Stuart paul Us, 123 00:07:05,120 --> 00:07:09,440 Speaker 2: economist with Bloomberg Economics. We move next to corporate earnings 124 00:07:09,440 --> 00:07:12,840 Speaker 2: from the fast food giant McDonald's. It's fourth quarter results 125 00:07:12,840 --> 00:07:15,360 Speaker 2: out on Monday. For more on the world's biggest burger chain, 126 00:07:15,440 --> 00:07:18,320 Speaker 2: the state of the fast food industry, and whether consumers 127 00:07:18,760 --> 00:07:21,520 Speaker 2: are pulling back on their spending. We're joined by Michael Halen, 128 00:07:21,600 --> 00:07:26,560 Speaker 2: Bloomberg Intelligence Senior Restaurant and food service analyst. Michael, thank 129 00:07:26,600 --> 00:07:30,440 Speaker 2: you for joining us. Now, Like every other dining establishment, 130 00:07:30,520 --> 00:07:33,720 Speaker 2: McDonald's has how to face a lot of challenges. Rising costs, 131 00:07:34,040 --> 00:07:37,800 Speaker 2: look at the price of eggs, higher salaries, cautious consumer spending. 132 00:07:38,080 --> 00:07:40,880 Speaker 2: It also had an E Coli outbreak last year that 133 00:07:40,960 --> 00:07:43,640 Speaker 2: may have really set things back. So what are you 134 00:07:43,960 --> 00:07:46,760 Speaker 2: looking for in this earnings report out on Monday. 135 00:07:47,360 --> 00:07:49,880 Speaker 6: Yeah, I think this earning report is going to be 136 00:07:49,920 --> 00:07:53,040 Speaker 6: kind of ugly, So, you know, to your point, e 137 00:07:53,160 --> 00:07:57,760 Speaker 6: Coli through a wrench into things. They had started off 138 00:07:57,760 --> 00:08:01,120 Speaker 6: the quarter well October seem store sales were up mid 139 00:08:01,200 --> 00:08:04,320 Speaker 6: single digits, Traffic was positive. They had kind of re 140 00:08:04,440 --> 00:08:08,160 Speaker 6: established themselves as as you know, one of the big 141 00:08:08,160 --> 00:08:10,720 Speaker 6: dogs in terms of value providers in there in the 142 00:08:10,760 --> 00:08:13,400 Speaker 6: restaurant business in the United States. With their five dollars 143 00:08:13,400 --> 00:08:15,960 Speaker 6: meal deal, it was going really well. Uh and then 144 00:08:16,000 --> 00:08:20,320 Speaker 6: they were hit that E Coli outbreak. And so from 145 00:08:20,440 --> 00:08:22,800 Speaker 6: data we've seen and you know, just what we expect 146 00:08:22,800 --> 00:08:26,800 Speaker 6: November and December, we're probably pretty pretty tough months for 147 00:08:27,000 --> 00:08:29,200 Speaker 6: the chain. You know, I think what the street is 148 00:08:29,240 --> 00:08:32,920 Speaker 6: really interested in is how January is doing so far. Right, 149 00:08:32,960 --> 00:08:37,559 Speaker 6: They've they've revamped their mcvalue menu, which hasn't been touched 150 00:08:37,559 --> 00:08:40,920 Speaker 6: in quite some time, and we think that could could 151 00:08:41,000 --> 00:08:43,160 Speaker 6: create some buzz. You know, the street really wanted to 152 00:08:43,200 --> 00:08:46,400 Speaker 6: see some some progress here on the same source. 153 00:08:46,400 --> 00:08:50,360 Speaker 2: Sales and traffic. Well, I'd say more than any other chain, 154 00:08:50,400 --> 00:08:53,679 Speaker 2: they are pretty nimble. They're willing to change. And how 155 00:08:53,679 --> 00:08:57,760 Speaker 2: do you think they McDonald's did reacting to that ecali scare. 156 00:08:57,800 --> 00:09:00,320 Speaker 2: I mean they shut things down right away. That quarter 157 00:09:00,320 --> 00:09:03,720 Speaker 2: pounder was unavailable I think nationwide even for a while, 158 00:09:03,840 --> 00:09:07,640 Speaker 2: just to la fears. But how do you think they 159 00:09:07,679 --> 00:09:08,400 Speaker 2: came back from that? 160 00:09:08,920 --> 00:09:11,160 Speaker 6: Yeah, so sales and traffic haven't bat back. I think 161 00:09:11,200 --> 00:09:14,040 Speaker 6: they handled it pretty well. They quickly, you know, stop 162 00:09:14,240 --> 00:09:17,720 Speaker 6: serving quarter pounders and quick got to the bottom of 163 00:09:17,720 --> 00:09:21,160 Speaker 6: the issue. You know, I think what's going to help 164 00:09:21,240 --> 00:09:23,960 Speaker 6: McDonald's versus say Chipotle, which was the last you know, 165 00:09:24,360 --> 00:09:27,400 Speaker 6: largely coal air brick in the industry. You know, we 166 00:09:27,480 --> 00:09:30,640 Speaker 6: think this is going to be a much shallower event 167 00:09:30,720 --> 00:09:33,400 Speaker 6: for McDonald's because it wasn't their fault. It wasn't because 168 00:09:33,440 --> 00:09:39,000 Speaker 6: of poor procedures or cleanliness issues or cross contamination or 169 00:09:39,040 --> 00:09:41,640 Speaker 6: anything like that. They receive bags of onions from a 170 00:09:41,679 --> 00:09:44,240 Speaker 6: distributor that were infected with E. Coli, right, And so 171 00:09:44,280 --> 00:09:46,280 Speaker 6: for that reason, we think this is going to be 172 00:09:46,280 --> 00:09:51,240 Speaker 6: a much shallower impact the same sort of sales. We 173 00:09:51,280 --> 00:09:54,440 Speaker 6: had some work done by a partner of ours, Cognovi Labs. 174 00:09:54,480 --> 00:10:00,640 Speaker 6: They use AI to analyze tweets and online forums and 175 00:10:00,960 --> 00:10:03,400 Speaker 6: things of that nature. And what their research found for 176 00:10:03,480 --> 00:10:08,680 Speaker 6: us was that mentions of ecal i quickly faded throughout 177 00:10:08,720 --> 00:10:12,120 Speaker 6: the fourth quarter in November and by year end, and 178 00:10:12,160 --> 00:10:18,280 Speaker 6: also the negative emotions tied to ecoali comments dissipated pretty quickly. 179 00:10:18,320 --> 00:10:20,960 Speaker 6: And so that what that tells us is that we 180 00:10:21,080 --> 00:10:23,040 Speaker 6: think this is going to be a much faster recovery 181 00:10:23,080 --> 00:10:25,400 Speaker 6: than ben Chipotle experience. We don't know if it's going 182 00:10:25,440 --> 00:10:27,760 Speaker 6: to be the end of by the end of one 183 00:10:27,840 --> 00:10:30,000 Speaker 6: Q or not. But you know, there's a potential for 184 00:10:30,040 --> 00:10:32,520 Speaker 6: them to increase sales LITW single digits here in the 185 00:10:32,559 --> 00:10:35,920 Speaker 6: second quarter, which, like I said earlier, the street wants 186 00:10:35,920 --> 00:10:37,840 Speaker 6: to see progress. We want to see progress in this 187 00:10:38,679 --> 00:10:41,400 Speaker 6: earnings report. We want to hear that January is doing 188 00:10:41,440 --> 00:10:43,760 Speaker 6: better than December, which did better than November. 189 00:10:43,880 --> 00:10:47,240 Speaker 2: Right right, right now. You mentioned the five dollars meal 190 00:10:47,280 --> 00:10:50,480 Speaker 2: deals that they had, and everybody, it seems, came up 191 00:10:50,480 --> 00:10:52,520 Speaker 2: with our own meal deals after that, and not just 192 00:10:52,559 --> 00:10:56,920 Speaker 2: fast food but quick service restaurants, casual dining chains. Do 193 00:10:57,000 --> 00:11:01,160 Speaker 2: you think that really changed the industry McDonald's launching those 194 00:11:01,200 --> 00:11:03,480 Speaker 2: five dollars It seems like that started. I think in 195 00:11:03,559 --> 00:11:06,240 Speaker 2: June of last year they extended it still going on. 196 00:11:06,320 --> 00:11:08,400 Speaker 2: You say, now they're going to revamp their mcvalue meal. 197 00:11:08,920 --> 00:11:12,160 Speaker 2: I mean, is this for right now here to stay? 198 00:11:12,720 --> 00:11:16,360 Speaker 6: Yeah, And I'd say that the big reason is that 199 00:11:16,360 --> 00:11:22,200 Speaker 6: that quick service chains are heavily frequented by low income consumers, 200 00:11:22,200 --> 00:11:26,640 Speaker 6: and low income consumers are are still being impacted more 201 00:11:26,679 --> 00:11:30,000 Speaker 6: than other consumers by inflation. Inflation is cumulative, right, and 202 00:11:30,040 --> 00:11:32,439 Speaker 6: so last year was a restaurant's recession. And that's why 203 00:11:32,480 --> 00:11:35,320 Speaker 6: we saw McDonald's start to lean into this. You know, 204 00:11:35,480 --> 00:11:37,400 Speaker 6: early in the year. Last year, there was a lot 205 00:11:37,520 --> 00:11:41,160 Speaker 6: of shade being thrown at McDonald's because a big mac 206 00:11:41,160 --> 00:11:43,959 Speaker 6: meal was eighteen dollars at a store in Connecticut, right, 207 00:11:44,000 --> 00:11:46,559 Speaker 6: And there was other quick service and fast casual names 208 00:11:46,600 --> 00:11:48,839 Speaker 6: like five Guys actually had a twenty two or twenty 209 00:11:48,840 --> 00:11:51,880 Speaker 6: three dollars meal deal, right, And so it was really 210 00:11:51,960 --> 00:11:55,320 Speaker 6: important for Quick Service to re establish that value proposition, 211 00:11:55,400 --> 00:11:58,560 Speaker 6: and that's why they did these five dollars meal deals, 212 00:11:58,559 --> 00:12:01,280 Speaker 6: and that's why they're going to continue to do them. 213 00:12:01,360 --> 00:12:01,560 Speaker 7: Right. 214 00:12:02,320 --> 00:12:05,400 Speaker 6: It was a tough year for restaurants, and Quick Service 215 00:12:05,440 --> 00:12:08,520 Speaker 6: had to do what they could to keep the low 216 00:12:08,559 --> 00:12:11,720 Speaker 6: income consumers coming back. You know, we're we're more bullish 217 00:12:11,760 --> 00:12:15,959 Speaker 6: on twenty twenty five. You know, with asset prices including 218 00:12:16,120 --> 00:12:19,920 Speaker 6: SMP bitcoin, home prices all near all time highs, we think, 219 00:12:20,400 --> 00:12:22,520 Speaker 6: you know, middle income, higher income consumers are going to 220 00:12:22,600 --> 00:12:26,520 Speaker 6: spend more. You know, we think there could be you know, 221 00:12:26,559 --> 00:12:28,840 Speaker 6: the results since the election have been better as well, 222 00:12:28,880 --> 00:12:32,199 Speaker 6: and so and some of the economic data that we watch, 223 00:12:32,280 --> 00:12:34,720 Speaker 6: and so, you know, for that reason, the low income 224 00:12:34,720 --> 00:12:37,440 Speaker 6: consumer could be a little bit better too. But you know, 225 00:12:37,559 --> 00:12:40,280 Speaker 6: because of the impacts of inflation on them, we think 226 00:12:41,360 --> 00:12:44,679 Speaker 6: quick services is probably the segment of the industry we're 227 00:12:44,720 --> 00:12:47,280 Speaker 6: the least excited about in twenty twenty five, and so 228 00:12:47,360 --> 00:12:49,319 Speaker 6: you're going to continue to see these discounts. 229 00:12:49,679 --> 00:12:52,600 Speaker 2: Oh that's good. Well McDonald's Q four earnings along with 230 00:12:52,640 --> 00:12:56,120 Speaker 2: the return of the Shamrock shake out on Monday, Haart 231 00:12:56,120 --> 00:12:59,000 Speaker 2: thanks to Michael Hale and Bloomberg Intelligence Senior restaurant and 232 00:12:59,040 --> 00:13:02,360 Speaker 2: food service Adaly. Coming up on Bloomberg day Break Weekend, 233 00:13:02,400 --> 00:13:05,280 Speaker 2: we'll look at what comes next in the global AI race. 234 00:13:05,640 --> 00:13:19,760 Speaker 2: I'm Tom Busby, and this is Bloomberg. This is Bloomberg 235 00:13:19,840 --> 00:13:22,000 Speaker 2: day Break Weekend, our global look ahead at the top 236 00:13:22,040 --> 00:13:24,920 Speaker 2: stories for investors in the coming week. I'm Tom Busby 237 00:13:25,000 --> 00:13:27,480 Speaker 2: in New York. Up later in our program, we'll look 238 00:13:27,480 --> 00:13:30,559 Speaker 2: at the potential fallout of Donald Trump's trade war with China. 239 00:13:30,720 --> 00:13:34,160 Speaker 2: But first, a summit on artificial intelligence taking place in 240 00:13:34,320 --> 00:13:37,200 Speaker 2: Paris this week, set to bring together the biggest names 241 00:13:37,200 --> 00:13:40,160 Speaker 2: in the sector, including government officials and business leaders. But 242 00:13:40,800 --> 00:13:44,400 Speaker 2: this comes after Chinese startup Deep Seek jolted competitors around 243 00:13:44,440 --> 00:13:47,480 Speaker 2: the world with a debut of its AI model, trained 244 00:13:47,480 --> 00:13:50,200 Speaker 2: at just a fraction of the cost of rivals. How 245 00:13:50,240 --> 00:13:53,760 Speaker 2: will the international community respond for more? Let's go to 246 00:13:53,800 --> 00:13:56,559 Speaker 2: London and bring in Bloomberg day Break europe banker Caroline 247 00:13:56,600 --> 00:13:57,959 Speaker 2: hepger Tom. 248 00:13:57,720 --> 00:14:00,560 Speaker 3: The AI Action Summit is duced to take place in 249 00:14:00,600 --> 00:14:04,480 Speaker 3: Paris in the next few days and at a fascinating moment. 250 00:14:04,880 --> 00:14:07,440 Speaker 3: It will be the first trip abroad for the newly 251 00:14:07,480 --> 00:14:12,040 Speaker 3: installed US Vice President jd. Vance. The Trump administration is 252 00:14:12,160 --> 00:14:15,480 Speaker 3: keen to take a leading role in this area. Just 253 00:14:15,520 --> 00:14:20,200 Speaker 3: look at President Trump's Stargate initiative, a one hundred billion 254 00:14:20,280 --> 00:14:25,840 Speaker 3: dollar venture designed to accelerate AI development. Plus, the gathering 255 00:14:25,920 --> 00:14:29,920 Speaker 3: takes place in the wake of Chinese firm Deep Seeks model, 256 00:14:30,240 --> 00:14:34,000 Speaker 3: raising questions about the billions of dollars firms have spent 257 00:14:34,400 --> 00:14:39,960 Speaker 3: to develop artificial intelligence technology and whether Beijing is closing 258 00:14:40,000 --> 00:14:43,840 Speaker 3: the gap with the US in this rapidly developing sphere. 259 00:14:44,480 --> 00:14:47,920 Speaker 3: So what's in store at the Paris AI Action Summit 260 00:14:48,040 --> 00:14:52,120 Speaker 3: and beyond for the industry, I've been asking Bloomberg's Technology 261 00:14:52,200 --> 00:14:54,440 Speaker 3: opinion columnist Pami Olsen. 262 00:14:55,080 --> 00:14:58,400 Speaker 7: The summit came about in twenty twenty three as an 263 00:14:58,400 --> 00:15:02,960 Speaker 7: AI safety summit in the UK and Bletchley Park which 264 00:15:03,000 --> 00:15:05,400 Speaker 7: is kind of famed for being home to a lot 265 00:15:05,400 --> 00:15:09,400 Speaker 7: of computer related innovation, and it was brought together, I think, 266 00:15:09,400 --> 00:15:12,280 Speaker 7: out of concern about the speed at which AI was 267 00:15:12,320 --> 00:15:15,840 Speaker 7: developing and the sense that there needed to be guardrails 268 00:15:15,880 --> 00:15:17,880 Speaker 7: put in place. And there was a lot of talk 269 00:15:17,920 --> 00:15:21,200 Speaker 7: back then about not just the short term risks of AI, 270 00:15:21,440 --> 00:15:25,720 Speaker 7: such as the rise of misinformation that chatbots could contribute to, 271 00:15:26,160 --> 00:15:31,600 Speaker 7: or the way that they could perhaps entrench certain stereotypes, 272 00:15:31,920 --> 00:15:37,640 Speaker 7: racial stereotypes, gender stereotypes, and biases, but also the potential 273 00:15:37,720 --> 00:15:43,440 Speaker 7: existential risk that AI could bring to civilization. These were 274 00:15:43,440 --> 00:15:45,920 Speaker 7: the sorts of things that Rishie Sunak, who was the 275 00:15:45,960 --> 00:15:48,760 Speaker 7: British Prime Minister at the time and he was hosting 276 00:15:48,800 --> 00:15:51,920 Speaker 7: the event, spoke about. It's a very different tone this 277 00:15:52,040 --> 00:15:56,640 Speaker 7: time around. The name has changed from AI Safety Summit 278 00:15:56,760 --> 00:15:59,600 Speaker 7: to AI Action Summit, and I think that's a very 279 00:15:59,640 --> 00:16:04,480 Speaker 7: interesting sting potential shift there in how governments want to 280 00:16:04,520 --> 00:16:09,160 Speaker 7: approach AI Now. They seem to be more eager to 281 00:16:09,280 --> 00:16:12,600 Speaker 7: kind of remain ahead in this race and maybe even 282 00:16:12,680 --> 00:16:17,120 Speaker 7: stimulate and encourage their own national champions more so than 283 00:16:17,200 --> 00:16:20,080 Speaker 7: putting guardrails in place for companies, which was really the 284 00:16:20,120 --> 00:16:22,760 Speaker 7: focus of the first of the first stummit. 285 00:16:23,280 --> 00:16:26,280 Speaker 3: Yeah, so why is this taking place now? 286 00:16:26,320 --> 00:16:26,520 Speaker 8: Then? 287 00:16:26,880 --> 00:16:29,200 Speaker 7: Well, as I understand it, this is an annual event, 288 00:16:29,280 --> 00:16:31,200 Speaker 7: and so there was one in twenty twenty three, then 289 00:16:31,200 --> 00:16:34,360 Speaker 7: there was another one in Seoul, South Korea last year, 290 00:16:34,400 --> 00:16:37,240 Speaker 7: and this year we've got one in Paris. That the 291 00:16:37,280 --> 00:16:40,720 Speaker 7: reason these have started is again just because of these 292 00:16:40,840 --> 00:16:45,240 Speaker 7: rapid advancements. You know, since chat GPT came out two 293 00:16:45,320 --> 00:16:48,800 Speaker 7: years ago, the rate at which AI models have been 294 00:16:48,840 --> 00:16:52,880 Speaker 7: improving is even taking scientists by surprise. You know, some 295 00:16:52,920 --> 00:16:55,400 Speaker 7: of the academic studying this stuff will read one paper. 296 00:16:55,760 --> 00:16:57,680 Speaker 7: By the time they've finished reading it, it's sort of 297 00:16:57,840 --> 00:17:01,200 Speaker 7: out of date because Anthropic or open AI or Google 298 00:17:01,240 --> 00:17:04,040 Speaker 7: have come up with something more incredible, like a video 299 00:17:04,080 --> 00:17:09,679 Speaker 7: generation tool. And you know, for businesses, investors, and policy makers, 300 00:17:09,520 --> 00:17:13,400 Speaker 7: it's been very tricky just to keep up, whether it's 301 00:17:13,400 --> 00:17:15,639 Speaker 7: to try and plug these systems into your businesses or 302 00:17:15,640 --> 00:17:18,040 Speaker 7: try and put the standards in place to keep them safe. 303 00:17:18,880 --> 00:17:21,560 Speaker 7: So and the other reason why I think this is 304 00:17:21,600 --> 00:17:25,680 Speaker 7: happening is I think that governments have realized over the 305 00:17:25,760 --> 00:17:29,440 Speaker 7: last decade that Silicon Valley companies should not be left 306 00:17:29,440 --> 00:17:33,639 Speaker 7: to regulate themselves and governments need to come together and 307 00:17:33,880 --> 00:17:37,520 Speaker 7: maybe put together some sort of international agency related to 308 00:17:37,520 --> 00:17:40,879 Speaker 7: the United Nations that can put some standards in place 309 00:17:41,359 --> 00:17:44,920 Speaker 7: that companies have a perhaps a legal obligation to follow, 310 00:17:45,320 --> 00:17:50,800 Speaker 7: because you know, there is nothing like that yet in existence. 311 00:17:50,840 --> 00:17:54,600 Speaker 7: And just a case in point, Google announced that they 312 00:17:54,640 --> 00:17:57,639 Speaker 7: are now removing their own ban on the use of 313 00:17:57,680 --> 00:18:02,320 Speaker 7: their AI for a military purpose, for weapons and for 314 00:18:02,480 --> 00:18:05,960 Speaker 7: surveillance tools, and so this has really caused a lot 315 00:18:06,000 --> 00:18:11,920 Speaker 7: of concern and consternation, particularly among civil society organizations and 316 00:18:12,760 --> 00:18:16,160 Speaker 7: policy makers that really governments need to step in and. 317 00:18:16,040 --> 00:18:20,280 Speaker 3: Do something interesting. So in terms of the heads of 318 00:18:20,320 --> 00:18:22,440 Speaker 3: state who are going to be there and the important 319 00:18:22,480 --> 00:18:25,960 Speaker 3: players out of Silicon Valley, who do you think will 320 00:18:25,960 --> 00:18:29,080 Speaker 3: be them? And obviously in Manu and Macon, but also 321 00:18:29,200 --> 00:18:34,240 Speaker 3: possibly JD. Vans possibly the other Silicon Valley leaders. Could 322 00:18:34,280 --> 00:18:39,040 Speaker 3: things get a bit tense given that everybody is jostling 323 00:18:39,080 --> 00:18:41,639 Speaker 3: to be at the forefront of this AI race. 324 00:18:42,080 --> 00:18:44,199 Speaker 7: You know, at first I thought there might be a 325 00:18:44,240 --> 00:18:48,119 Speaker 7: lot of tension between the US and China, so as 326 00:18:48,160 --> 00:18:51,080 Speaker 7: there always is on this topic of AI governance. But 327 00:18:51,119 --> 00:18:54,880 Speaker 7: it was interesting when the first AI s at International 328 00:18:54,920 --> 00:18:57,760 Speaker 7: AI sam It happened in the UK two years ago. 329 00:18:58,840 --> 00:19:02,439 Speaker 7: China sent uh this kind of biace minister for Science 330 00:19:02,480 --> 00:19:05,320 Speaker 7: and Technology, and he was really kept at arm's length 331 00:19:05,800 --> 00:19:09,720 Speaker 7: on these kind of national security concerns. Now I think 332 00:19:09,760 --> 00:19:12,880 Speaker 7: it's going to be different. I think that China's officials, 333 00:19:13,080 --> 00:19:15,680 Speaker 7: and China is sending one of its top government officials 334 00:19:15,680 --> 00:19:19,479 Speaker 7: a very close ally to Jijiping, much higher ranking than 335 00:19:19,480 --> 00:19:21,760 Speaker 7: the guy who came the first time. I think he's 336 00:19:21,800 --> 00:19:25,280 Speaker 7: going to be given a much warmer welcome, just because 337 00:19:25,320 --> 00:19:28,159 Speaker 7: of deep seat that the Chinese company that in the 338 00:19:28,240 --> 00:19:31,119 Speaker 7: last couple of weeks has really shocked the market with 339 00:19:31,160 --> 00:19:36,080 Speaker 7: its ability to make AI models so efficiently and really 340 00:19:36,119 --> 00:19:40,840 Speaker 7: disrupt the economics of this new market. And so just 341 00:19:40,920 --> 00:19:44,280 Speaker 7: given what Chinese companies have been achieving in research and development, 342 00:19:45,720 --> 00:19:47,639 Speaker 7: I think the Chinese officials there are going to be 343 00:19:47,640 --> 00:19:51,680 Speaker 7: given a warmer welcome. Overall, there might well be some 344 00:19:51,680 --> 00:19:55,959 Speaker 7: some tensions over what policy should be, but also it 345 00:19:56,000 --> 00:19:58,360 Speaker 7: really just depends on who ends up who ends up 346 00:19:58,400 --> 00:20:03,840 Speaker 7: going to represent the United States, and I believe some 347 00:20:03,920 --> 00:20:05,960 Speaker 7: quite high ranking people from India are going to be 348 00:20:06,000 --> 00:20:08,679 Speaker 7: there as well. And again that's I think again that 349 00:20:08,720 --> 00:20:11,680 Speaker 7: comes down to what happened with deep Seat Deep Deep 350 00:20:11,760 --> 00:20:15,680 Speaker 7: Seek showed that the you know, the current AI race 351 00:20:16,240 --> 00:20:20,480 Speaker 7: in it, the guaranteed winners are not necessarily American companies, 352 00:20:20,680 --> 00:20:24,640 Speaker 7: America's tech giants. It could be smaller companies from developing nations. 353 00:20:25,520 --> 00:20:28,680 Speaker 3: Yeah, which is which is fascinating, isn't it that Deep 354 00:20:28,720 --> 00:20:34,040 Speaker 3: Seek has for such a rethink. But a lot of 355 00:20:34,040 --> 00:20:38,840 Speaker 3: the big US companies are still committed to spending on 356 00:20:38,840 --> 00:20:42,800 Speaker 3: on growth open AI in particular and others. I wonder 357 00:20:42,840 --> 00:20:46,600 Speaker 3: whether there's any development in on that front. As far 358 00:20:46,640 --> 00:20:47,920 Speaker 3: as you're concerned. 359 00:20:47,640 --> 00:20:49,720 Speaker 7: I think the spending is going to continue, and we 360 00:20:49,920 --> 00:20:53,440 Speaker 7: saw a commitment to that actually just in last week 361 00:20:53,640 --> 00:21:00,960 Speaker 7: when tech companies like Microsoft and Meta Platforms were announcing 362 00:21:01,040 --> 00:21:03,840 Speaker 7: their earnings. So it was an awkward time for them 363 00:21:04,000 --> 00:21:07,800 Speaker 7: because they had just been completely undercut in a way 364 00:21:07,640 --> 00:21:10,320 Speaker 7: by deep Seek, and then they had to talk to 365 00:21:10,400 --> 00:21:15,080 Speaker 7: their investors about these tens of billions of dollars They 366 00:21:15,080 --> 00:21:18,800 Speaker 7: want to continue spending on AI, and I think actually 367 00:21:19,840 --> 00:21:25,480 Speaker 7: they can continue. They do have some justification to spend 368 00:21:25,480 --> 00:21:28,840 Speaker 7: that much because in the last week there have been 369 00:21:29,359 --> 00:21:33,639 Speaker 7: a lot of security concerns raised about deep Seek. Some 370 00:21:33,880 --> 00:21:36,840 Speaker 7: security researchers have said that although deep Seek made its 371 00:21:36,880 --> 00:21:40,200 Speaker 7: model very efficient, it's actually really low on the scale 372 00:21:40,280 --> 00:21:43,920 Speaker 7: when it comes to the ability for people to jail 373 00:21:43,960 --> 00:21:47,479 Speaker 7: break its model, meaning they could get it to do 374 00:21:47,560 --> 00:21:53,600 Speaker 7: things it's not supposed to, or steal private information that 375 00:21:53,680 --> 00:21:56,800 Speaker 7: the model is kind of plugged into. So I think 376 00:21:56,800 --> 00:22:00,760 Speaker 7: that would really hurt deep seak prospects in terms of 377 00:22:00,760 --> 00:22:04,159 Speaker 7: getting business customers potentially, And that is a little bit 378 00:22:04,200 --> 00:22:08,119 Speaker 7: of a vindication for the tech giants who are spending 379 00:22:08,200 --> 00:22:11,640 Speaker 7: a lot on infrastructure, billions and billions of dollars on infrastructure, 380 00:22:11,720 --> 00:22:14,400 Speaker 7: which isn't just the power AI, but also to keep 381 00:22:14,400 --> 00:22:15,359 Speaker 7: it secure. 382 00:22:15,600 --> 00:22:18,240 Speaker 3: And tell us also a little bit about one of 383 00:22:18,240 --> 00:22:22,400 Speaker 3: the other ventures within AI, which is Stargate and what's 384 00:22:22,480 --> 00:22:24,520 Speaker 3: kind of happening with that and why people think it's 385 00:22:24,560 --> 00:22:27,840 Speaker 3: so interesting what may come in the weeks and months ahead. 386 00:22:28,359 --> 00:22:31,359 Speaker 7: Yeah, so I think we really it's it's an open 387 00:22:31,440 --> 00:22:35,000 Speaker 7: question because this is a project that was a five 388 00:22:35,080 --> 00:22:40,760 Speaker 7: hundred billion dollar project to really just boost the infrastructure 389 00:22:41,720 --> 00:22:45,919 Speaker 7: investment in the US on AI data center spending and 390 00:22:46,000 --> 00:22:49,800 Speaker 7: so forth. I've heard some people say that five hundred 391 00:22:50,280 --> 00:22:53,480 Speaker 7: million like the billion. It doesn't it doesn't need to 392 00:22:53,520 --> 00:22:57,800 Speaker 7: be that high. That for what the government is trying 393 00:22:57,840 --> 00:23:00,240 Speaker 7: to do and what open ai is trying to do 394 00:23:00,320 --> 00:23:03,679 Speaker 7: as a potential beneficiary to all this just does not 395 00:23:03,800 --> 00:23:07,480 Speaker 7: need that amount of funding. But we'll see, i suppose, 396 00:23:07,480 --> 00:23:11,080 Speaker 7: in the in the months ahead, whether open ai actually 397 00:23:11,119 --> 00:23:15,639 Speaker 7: is able to make good on some of the discoveries 398 00:23:15,640 --> 00:23:18,840 Speaker 7: that deep seek has made, because remember deep seek is 399 00:23:19,880 --> 00:23:22,439 Speaker 7: not strictly open source, but it's it's an open weights 400 00:23:23,680 --> 00:23:28,159 Speaker 7: uh model, and that it has put the blueprints for 401 00:23:28,240 --> 00:23:31,000 Speaker 7: its incredibly efficient model on the Internet for anybody to 402 00:23:31,040 --> 00:23:34,320 Speaker 7: copy and use. So if open ai and Microsoft and 403 00:23:34,359 --> 00:23:37,280 Speaker 7: Google just start poppying what China has come up with, 404 00:23:37,440 --> 00:23:41,080 Speaker 7: they're probably going to start building much more efficient AI 405 00:23:41,160 --> 00:23:44,280 Speaker 7: models and maybe they won't need all that infrastructure that 406 00:23:44,920 --> 00:23:48,280 Speaker 7: has been you know, applauded and talked up in the 407 00:23:48,359 --> 00:23:50,400 Speaker 7: last few weeks with Stargate. 408 00:23:50,320 --> 00:23:53,680 Speaker 3: We've had that. Of course, the big tech companies are 409 00:23:54,680 --> 00:23:59,240 Speaker 3: ditching commitments to TODI as the federal government in the 410 00:23:59,359 --> 00:24:01,720 Speaker 3: US is how much of a role do you think 411 00:24:01,760 --> 00:24:05,320 Speaker 3: the regulation is going to play now in determining the 412 00:24:05,359 --> 00:24:07,919 Speaker 3: future of AI? And this is also very important as 413 00:24:07,960 --> 00:24:11,520 Speaker 3: we sit in Europe and think about the tensions between 414 00:24:11,640 --> 00:24:16,240 Speaker 3: you know, the European understanding of safety for consumers and 415 00:24:16,600 --> 00:24:18,320 Speaker 3: a very different approach in the US. 416 00:24:18,920 --> 00:24:24,120 Speaker 9: Yeah, And I think that's something hopefully that will actually 417 00:24:24,160 --> 00:24:28,280 Speaker 9: gain some more attention at this summit in the next 418 00:24:28,280 --> 00:24:32,879 Speaker 9: few days, because what we've seen, you know, what I 419 00:24:32,880 --> 00:24:34,639 Speaker 9: talked about in the beginning, is this kind of shift 420 00:24:34,680 --> 00:24:39,439 Speaker 9: in tone and in terms of governments being not just 421 00:24:39,520 --> 00:24:43,040 Speaker 9: in the US but even in the UK shifting away 422 00:24:43,119 --> 00:24:50,040 Speaker 9: from framing themselves as you know, standard bearers, putting in 423 00:24:50,040 --> 00:24:53,600 Speaker 9: the standards and the guardrails for companies to build AI safely. 424 00:24:54,920 --> 00:24:58,199 Speaker 7: And I hope that we will continue to sort of 425 00:24:58,560 --> 00:25:02,560 Speaker 7: continue that confidence in that role that governments have to play. 426 00:25:02,880 --> 00:25:05,840 Speaker 3: My thanks there to Bloomberg's Pami Olson for joining me. 427 00:25:06,000 --> 00:25:10,480 Speaker 3: So technology with the potential to transform our lives and 428 00:25:10,520 --> 00:25:14,920 Speaker 3: for some global leaders a matter of national security. Where 429 00:25:14,960 --> 00:25:17,800 Speaker 3: will the world's journey with AI take us? 430 00:25:17,880 --> 00:25:18,280 Speaker 7: Next? 431 00:25:18,760 --> 00:25:22,199 Speaker 3: We will have full coverage of the AI Action Summit 432 00:25:22,280 --> 00:25:25,840 Speaker 3: in Paris for you here on Bloomberg. I'm Caroline Hepka 433 00:25:25,960 --> 00:25:28,480 Speaker 3: in London and you can catch us every weekday morning 434 00:25:28,640 --> 00:25:31,520 Speaker 3: for Blueberg Daybreak you at beginning at six am in London. 435 00:25:31,800 --> 00:25:33,840 Speaker 3: That's one am on Wall Street. Tom. 436 00:25:34,280 --> 00:25:36,840 Speaker 2: Thanks Caroline and coming up on Bloomberg day Break weekend, 437 00:25:36,880 --> 00:25:39,399 Speaker 2: we'll look at the potential fallout of Donald Trump's trade 438 00:25:39,440 --> 00:25:43,200 Speaker 2: war with China. I'm Tom Busby and this is Bloomberg. 439 00:25:54,640 --> 00:25:57,160 Speaker 2: This is Bloomberg day Break Weekend, our global look ahead 440 00:25:57,160 --> 00:25:59,440 Speaker 2: at the top stories for investors in the coming week. 441 00:26:00,040 --> 00:26:02,760 Speaker 2: Tom Busby and New York. President Trump has to some 442 00:26:02,880 --> 00:26:06,680 Speaker 2: extent made good on his promises of tariffs. The US 443 00:26:06,800 --> 00:26:10,600 Speaker 2: reaching deals to delay implementing tariffs on neighbors Canada and Mexico, 444 00:26:10,640 --> 00:26:13,639 Speaker 2: but tariffs on Chinese goods are now in effect. And 445 00:26:13,680 --> 00:26:16,000 Speaker 2: for a look at the potential fallout, let's get to 446 00:26:16,040 --> 00:26:19,040 Speaker 2: the host of the Daybreak Asia podcast, Doug Krisner. 447 00:26:19,440 --> 00:26:22,200 Speaker 4: Tom, the US China trade war seems to be underway. 448 00:26:22,480 --> 00:26:25,600 Speaker 4: Donald Trump's thread of those US tariffs loomed over the 449 00:26:25,600 --> 00:26:29,760 Speaker 4: presidential campaign and they're now a reality, a blanket ten 450 00:26:29,800 --> 00:26:32,960 Speaker 4: percent tariff on all Chinese goods imported to the US. 451 00:26:33,400 --> 00:26:35,960 Speaker 4: So the question now is where do we go from here. 452 00:26:36,400 --> 00:26:39,840 Speaker 4: Let's cross to Singapore where we find Bloomberg opinion columnist 453 00:26:40,040 --> 00:26:44,000 Speaker 4: Karishma Vaswani. She has been writing about the potential backlash. 454 00:26:44,240 --> 00:26:47,160 Speaker 4: Karishma joining us from our studios in the Lion City. 455 00:26:47,400 --> 00:26:49,239 Speaker 4: Thank you for making time to chat with us. It's 456 00:26:49,280 --> 00:26:52,000 Speaker 4: always a pleasure. Can I start by getting your initial 457 00:26:52,119 --> 00:26:53,920 Speaker 4: reaction to what we know so far. 458 00:26:54,400 --> 00:26:57,040 Speaker 10: I think what you're seeing from the United States and 459 00:26:57,160 --> 00:27:01,080 Speaker 10: from President Donald Trump is a degree of what he 460 00:27:01,200 --> 00:27:03,760 Speaker 10: said that he was going to do on the campaign trail, 461 00:27:03,840 --> 00:27:06,159 Speaker 10: that he was going to be tough on drugs, he 462 00:27:06,280 --> 00:27:08,439 Speaker 10: was going to be tough when it came to trade. 463 00:27:09,240 --> 00:27:11,560 Speaker 10: You know, one of the things I found particularly notable 464 00:27:12,160 --> 00:27:15,280 Speaker 10: in my research was that with regards to some of 465 00:27:15,320 --> 00:27:19,200 Speaker 10: the most important issues for Americans, and you'll know this well, Doug, 466 00:27:19,480 --> 00:27:22,840 Speaker 10: you know, being based out there, that they wanted their 467 00:27:22,960 --> 00:27:26,720 Speaker 10: leader to focus on drugs, possibly even more so, some 468 00:27:26,800 --> 00:27:30,760 Speaker 10: surveys suggested, than reducing the budget deficit and even unemployment. 469 00:27:31,200 --> 00:27:34,359 Speaker 10: So that's what he's showing to his domestic audience. He's saying, Look, 470 00:27:34,400 --> 00:27:38,760 Speaker 10: I'm tying tariffs and trade to this issue of drugs 471 00:27:38,800 --> 00:27:42,119 Speaker 10: coming into our borders and immigrants coming into our borders, 472 00:27:42,160 --> 00:27:44,960 Speaker 10: and I'm going to show the world whose boss now. 473 00:27:45,240 --> 00:27:47,440 Speaker 10: In the short term, as I argue in my column, 474 00:27:47,640 --> 00:27:50,560 Speaker 10: he seems to have achieved that, certainly with Canada and Mexico, 475 00:27:51,040 --> 00:27:53,560 Speaker 10: In the long term, I feel like this will be 476 00:27:53,600 --> 00:27:56,680 Speaker 10: a massive reputational damage to the United States in terms 477 00:27:56,720 --> 00:27:59,920 Speaker 10: of its image as a fair player, a global act, 478 00:28:00,400 --> 00:28:04,360 Speaker 10: and a force of stability. Instead, I think countries will 479 00:28:04,359 --> 00:28:06,360 Speaker 10: be looking at the US and trying to figure out 480 00:28:06,440 --> 00:28:10,280 Speaker 10: their Trump two point zero playbook, and you know, getting 481 00:28:10,280 --> 00:28:12,919 Speaker 10: a sense that the US under Trump is going to 482 00:28:12,920 --> 00:28:15,440 Speaker 10: be quite unpredictable. And then that brings us to China. 483 00:28:15,480 --> 00:28:17,800 Speaker 4: Of course, Yes, well that's the next question. What do 484 00:28:17,840 --> 00:28:20,119 Speaker 4: we know about the degree to which this is resonating 485 00:28:20,240 --> 00:28:22,680 Speaker 4: in Beijing. I mean, this is not the first time 486 00:28:23,000 --> 00:28:26,680 Speaker 4: that President Trump has dealt with Chinese President Chi Jinping. 487 00:28:26,760 --> 00:28:29,280 Speaker 4: There was a trade war during the first Trump administration. 488 00:28:29,640 --> 00:28:32,200 Speaker 4: Is this resonating in a slightly different fashion now? 489 00:28:32,600 --> 00:28:35,439 Speaker 10: I think it is simply because China is in a 490 00:28:35,520 --> 00:28:39,120 Speaker 10: very different position now. One the economy isn't as strong 491 00:28:39,160 --> 00:28:40,040 Speaker 10: as it was back then. 492 00:28:40,240 --> 00:28:40,560 Speaker 11: Two. 493 00:28:41,080 --> 00:28:43,280 Speaker 10: I think it is fair to say that sigen Ping 494 00:28:43,320 --> 00:28:48,760 Speaker 10: President Cigenping is looking to legitimize his image as a 495 00:28:48,920 --> 00:28:52,320 Speaker 10: sort of, you know, somebody who can bring stability to 496 00:28:52,440 --> 00:28:55,880 Speaker 10: the Chinese economy and to the political situation. It's impossible 497 00:28:55,920 --> 00:28:58,160 Speaker 10: to know, of course, given how opaque it is it's 498 00:28:58,200 --> 00:29:00,960 Speaker 10: like a black box out there. But certainly when you 499 00:29:01,000 --> 00:29:04,000 Speaker 10: look at economic indicators, use unemployment, all of that, that's 500 00:29:04,040 --> 00:29:06,680 Speaker 10: been under pressure for quite some time in China, so 501 00:29:07,240 --> 00:29:09,240 Speaker 10: you know it is coming off a back foot. But 502 00:29:09,280 --> 00:29:11,880 Speaker 10: I thought it was really interesting that what we saw, 503 00:29:12,040 --> 00:29:16,120 Speaker 10: instead of a capitulation the way you know, the Canada 504 00:29:16,280 --> 00:29:19,680 Speaker 10: and Mexico actions have been perceived to be, what we 505 00:29:19,720 --> 00:29:24,440 Speaker 10: saw instead was proper retaliation, and China decided to hit back, 506 00:29:24,520 --> 00:29:27,480 Speaker 10: or at least threaten to retaliate with its own set 507 00:29:27,480 --> 00:29:29,920 Speaker 10: of taros, saying that it would implement a fifteen percent 508 00:29:29,960 --> 00:29:33,400 Speaker 10: tarafon coal and liquified natural gas products, as well as 509 00:29:33,400 --> 00:29:36,680 Speaker 10: a ten percent tarifon crude oil, agricultural machinery, and large 510 00:29:36,720 --> 00:29:39,680 Speaker 10: engine cars imported from the US from the tenth to February. 511 00:29:39,680 --> 00:29:43,600 Speaker 10: So that still gives us some time. Between the two men, 512 00:29:44,080 --> 00:29:47,040 Speaker 10: Siagean Ping and Donald Trump. You know, it's been indicated 513 00:29:47,080 --> 00:29:49,080 Speaker 10: from the US that they're going to have a conversation. 514 00:29:50,440 --> 00:29:52,680 Speaker 10: He has talked. Trump has talked in the past about 515 00:29:52,720 --> 00:29:55,240 Speaker 10: what a good relationship he has with Sigean Ping. He's 516 00:29:55,240 --> 00:29:58,320 Speaker 10: talked about TikTok being on the table, And I think 517 00:29:58,400 --> 00:30:01,680 Speaker 10: all of this is quite perform pomative from both sides, 518 00:30:01,720 --> 00:30:04,120 Speaker 10: saying like, look, we're willing to deal, but it has 519 00:30:04,200 --> 00:30:05,800 Speaker 10: to be on our terms as well. I think that's 520 00:30:05,800 --> 00:30:07,239 Speaker 10: what you're getting from the Chinese right. 521 00:30:07,480 --> 00:30:10,840 Speaker 4: So at the same time that those retaliatory tariffs were announced, 522 00:30:10,880 --> 00:30:14,680 Speaker 4: China launched an antitrust probe into Google. I thought that 523 00:30:14,800 --> 00:30:18,120 Speaker 4: was very interesting. I spoke earlier with Annabel Droolers, she 524 00:30:18,240 --> 00:30:21,360 Speaker 4: is our tech reporter from Hong Kong. Here's what she 525 00:30:21,480 --> 00:30:22,040 Speaker 4: had to say. 526 00:30:22,360 --> 00:30:24,320 Speaker 8: Well, it is a little bit confusing, actually, you could 527 00:30:24,320 --> 00:30:26,800 Speaker 8: probably say because a lot of people would know that 528 00:30:26,800 --> 00:30:29,840 Speaker 8: that Google hasn't been available as a search engine in 529 00:30:29,920 --> 00:30:32,560 Speaker 8: China going all the way back to twenty ten. So 530 00:30:33,160 --> 00:30:35,720 Speaker 8: you know, the question is really what exactly is China 531 00:30:35,760 --> 00:30:38,400 Speaker 8: going to be looking into. And essentially what they're announced 532 00:30:38,560 --> 00:30:43,640 Speaker 8: is an investigation into Alphabet's Google for alleged antitrust violations. 533 00:30:44,120 --> 00:30:46,800 Speaker 8: The real focus of this is perhaps going to pertain 534 00:30:46,840 --> 00:30:48,920 Speaker 8: and this is what our Bloomberg intelligence team is saying, 535 00:30:48,960 --> 00:30:51,000 Speaker 8: but it could relate to the market dominance of the 536 00:30:51,000 --> 00:30:54,680 Speaker 8: Google Android mobile phone operating system, which is in China's 537 00:30:54,680 --> 00:30:58,040 Speaker 8: smartphone sector of course, and according to data from IDC, 538 00:30:58,240 --> 00:31:01,160 Speaker 8: approximately seventy percent of smartphone sort are sold in China. 539 00:31:01,160 --> 00:31:04,120 Speaker 8: We're Android based last year, so that could be the 540 00:31:04,200 --> 00:31:05,680 Speaker 8: sort of the broader focus that. 541 00:31:05,720 --> 00:31:09,360 Speaker 4: Is Annabel Jewelers our tech reporter in Hong Kong. Let's 542 00:31:09,400 --> 00:31:13,600 Speaker 4: get back to our conversation with Kriishma Vaswani Karishma. Where 543 00:31:13,600 --> 00:31:16,280 Speaker 4: do we go from here in terms of the tension 544 00:31:16,360 --> 00:31:19,040 Speaker 4: on the technology side between the US and China. We 545 00:31:19,120 --> 00:31:22,960 Speaker 4: know that during the Biden administration those strict export controls 546 00:31:22,960 --> 00:31:26,760 Speaker 4: were put in place on semiconductors. This became revisited with 547 00:31:26,920 --> 00:31:29,600 Speaker 4: the story on deep Seek a couple of weeks ago. 548 00:31:30,080 --> 00:31:32,560 Speaker 4: Now we're talking about Google. Where do we go here 549 00:31:32,600 --> 00:31:33,360 Speaker 4: on the tech front? 550 00:31:33,720 --> 00:31:36,480 Speaker 10: Yeah, I think Google, you know, it's a bit of 551 00:31:36,480 --> 00:31:39,560 Speaker 10: a symbolic gesture, to be very honest, and I think, 552 00:31:39,640 --> 00:31:42,640 Speaker 10: you know, our tech correspondent in Hong Kong sort of 553 00:31:42,680 --> 00:31:45,520 Speaker 10: alluded to that. I see it as quite a separate 554 00:31:45,600 --> 00:31:49,520 Speaker 10: issue from things like deep Seek, as well as the 555 00:31:50,680 --> 00:31:54,240 Speaker 10: limited access for Chinese firms pretty much no access to 556 00:31:54,520 --> 00:31:57,760 Speaker 10: high end US technology. And I think what China is 557 00:31:57,800 --> 00:31:59,920 Speaker 10: saying with that is, look, this is our first south 558 00:32:00,280 --> 00:32:02,400 Speaker 10: and it's not a big one. It's not something that 559 00:32:02,440 --> 00:32:04,920 Speaker 10: could really hurt you all that much. You know, it's 560 00:32:04,960 --> 00:32:07,680 Speaker 10: still an investigation at this point and it hasn't reached 561 00:32:07,720 --> 00:32:10,480 Speaker 10: any sort of decision yet. But I think what China 562 00:32:10,520 --> 00:32:13,840 Speaker 10: is showing by saying that it's looking into this and 563 00:32:13,880 --> 00:32:17,760 Speaker 10: it's a big, massive American tech company, is that, you know, 564 00:32:18,160 --> 00:32:20,520 Speaker 10: you know, push us a little bit further, Trump, and 565 00:32:20,560 --> 00:32:22,680 Speaker 10: we could go further too, And if you want to 566 00:32:22,680 --> 00:32:26,080 Speaker 10: get into this tip for tat retaliatory kind of battle, 567 00:32:26,160 --> 00:32:28,560 Speaker 10: we can do that. We did that in the first 568 00:32:28,640 --> 00:32:31,040 Speaker 10: administration and if you look back, it's quite interesting. And 569 00:32:31,280 --> 00:32:33,400 Speaker 10: some of our colleagues have written about this on the 570 00:32:33,440 --> 00:32:37,440 Speaker 10: Bloomberg website as well, tracking the first set of tariffs 571 00:32:37,480 --> 00:32:41,400 Speaker 10: during the first trade war and looking at pretty much 572 00:32:41,480 --> 00:32:44,800 Speaker 10: the sort of mirroring of what China did every time 573 00:32:44,920 --> 00:32:47,000 Speaker 10: Trump put in a new set of tariffs. And I'm 574 00:32:47,000 --> 00:32:50,120 Speaker 10: sure you know this phrase in dating culture, Doug, but 575 00:32:50,280 --> 00:32:54,880 Speaker 10: matching your energy recently learned that, and I think that's 576 00:32:54,920 --> 00:32:58,560 Speaker 10: what China is trying to do at this point as well, 577 00:32:58,600 --> 00:33:03,000 Speaker 10: but not to the extent that it would antagonize Trump completely. 578 00:33:03,280 --> 00:33:05,680 Speaker 10: It's to leave that door open and say we're willing 579 00:33:05,760 --> 00:33:08,760 Speaker 10: to talk, but it has to also work in our favor. 580 00:33:08,920 --> 00:33:11,120 Speaker 4: You know, I mentioned the export controls that were put 581 00:33:11,200 --> 00:33:14,480 Speaker 4: in place under the Biden administration. Those were not unilateral. 582 00:33:14,920 --> 00:33:19,640 Speaker 4: The cooperation came from Japan also the Netherlands. Are we 583 00:33:19,680 --> 00:33:23,160 Speaker 4: in a situation now where Trump is functioning more unilaterally 584 00:33:23,240 --> 00:33:26,360 Speaker 4: and could that be problematic for the United States going forward? 585 00:33:26,680 --> 00:33:29,560 Speaker 10: I think it's extremely problematic, and I think it's a 586 00:33:29,640 --> 00:33:32,000 Speaker 10: really good question that you've posed. It's frankly, it's the 587 00:33:32,040 --> 00:33:34,440 Speaker 10: focus of one of my columns coming up, so I'll 588 00:33:34,480 --> 00:33:36,400 Speaker 10: be sure to come up and talk to you about 589 00:33:36,400 --> 00:33:38,760 Speaker 10: that when I do publish. But I think this is 590 00:33:38,760 --> 00:33:43,040 Speaker 10: a huge issue because what Trump has done with regards 591 00:33:43,080 --> 00:33:46,960 Speaker 10: to the actions, for example, with close allies like Canada 592 00:33:47,040 --> 00:33:51,280 Speaker 10: and Mexico. The signal that sends to other countries like Japan, 593 00:33:51,520 --> 00:33:54,760 Speaker 10: South Korea is that we're all at risk, right Like, 594 00:33:54,800 --> 00:33:57,880 Speaker 10: if Canada and Mexico aren't safe, then who is safe? 595 00:33:58,120 --> 00:34:01,800 Speaker 10: And in the past, the Biden administry worked really effectively 596 00:34:02,280 --> 00:34:04,520 Speaker 10: in places like the South China Sea in the Indo 597 00:34:04,560 --> 00:34:08,359 Speaker 10: Pacific from business, trade and geopolitics to say, look, it's 598 00:34:08,360 --> 00:34:11,359 Speaker 10: in your interests to side with us, and yes, China 599 00:34:11,400 --> 00:34:13,319 Speaker 10: is a massive trading partner for you, but we're going 600 00:34:13,360 --> 00:34:16,359 Speaker 10: to keep you safe. We are on your side, and 601 00:34:16,400 --> 00:34:19,200 Speaker 10: that built a degree of goodwill that I think a 602 00:34:19,239 --> 00:34:20,799 Speaker 10: lot of the time is sort of lost in the 603 00:34:20,840 --> 00:34:24,239 Speaker 10: geopolitical conversation when it comes to looking back at the 604 00:34:24,239 --> 00:34:27,000 Speaker 10: Biden administration and you know, we have to be fair. 605 00:34:27,040 --> 00:34:29,879 Speaker 10: There were lots of missteps as well. But I think 606 00:34:29,920 --> 00:34:33,240 Speaker 10: the key thing going forward if Trump is serious about 607 00:34:33,320 --> 00:34:37,840 Speaker 10: keeping Americans safe, about ensuring that American supremacy to some 608 00:34:37,960 --> 00:34:41,880 Speaker 10: extent is still you know, valid and something that is 609 00:34:41,960 --> 00:34:45,880 Speaker 10: respected around the world, then tearing up trading agreements, not 610 00:34:46,040 --> 00:34:49,160 Speaker 10: paying attention to close allies like Japan and South Korea, 611 00:34:49,600 --> 00:34:52,200 Speaker 10: not making sure that these sort of alliances are in 612 00:34:52,239 --> 00:34:55,040 Speaker 10: place in the Indo Pacific, in South China Sea. That 613 00:34:55,120 --> 00:34:58,279 Speaker 10: will make America a more dangerous place and reduce the 614 00:34:58,320 --> 00:35:01,759 Speaker 10: supremacy of the United States on the international state. 615 00:35:02,000 --> 00:35:05,680 Speaker 4: Very recently, US Secretary of State Marco Rubio traveled to 616 00:35:05,719 --> 00:35:10,680 Speaker 4: Panama and he essentially echoed Trump's complaints about Chinese influence 617 00:35:11,160 --> 00:35:13,920 Speaker 4: or certain parts of the Panama Canal. How do you 618 00:35:13,920 --> 00:35:16,040 Speaker 4: think that resonated in Beijing. 619 00:35:16,640 --> 00:35:20,560 Speaker 10: I think that will worry them a lot, because you know, 620 00:35:21,160 --> 00:35:25,920 Speaker 10: the Chinese have managed to parley their economic influence into 621 00:35:26,040 --> 00:35:29,120 Speaker 10: geopolitical influence around the world. That was what Belton Road 622 00:35:29,280 --> 00:35:32,080 Speaker 10: was definitely about. And you know, again, I think it's 623 00:35:32,080 --> 00:35:35,800 Speaker 10: important to take a balanced view here. What Rubio is 624 00:35:35,800 --> 00:35:38,680 Speaker 10: saying is not necessarily wrong. It's just the methods I 625 00:35:38,680 --> 00:35:41,480 Speaker 10: think that he's using might seem a bit heavy handed 626 00:35:42,360 --> 00:35:45,520 Speaker 10: when you look at the way international diplomacy might well 627 00:35:45,560 --> 00:35:49,279 Speaker 10: be conducted. But it does echo a lot of what 628 00:35:49,320 --> 00:35:52,040 Speaker 10: the Biden administration has said before as well. 629 00:35:52,560 --> 00:35:55,960 Speaker 4: Karishma, thank you so much for joining us. That's Korishma Vaswani, 630 00:35:56,000 --> 00:35:59,799 Speaker 4: columnist for Bloomberg Opinion. So let's turn out and get 631 00:35:59,840 --> 00:36:03,520 Speaker 4: some deeper market analysis. I spoke with Stephanie Leon. She 632 00:36:03,760 --> 00:36:07,120 Speaker 4: is the chief investment officer at Stashua. We know the 633 00:36:07,160 --> 00:36:09,799 Speaker 4: situation in China is quite different from what it was 634 00:36:10,320 --> 00:36:12,920 Speaker 4: during the last Trump administration, and I'm wondering whether She 635 00:36:13,120 --> 00:36:17,400 Speaker 4: Jinping knows or feels that he has a much weaker 636 00:36:17,440 --> 00:36:18,439 Speaker 4: hand to play right now. 637 00:36:19,160 --> 00:36:21,399 Speaker 11: Yes, I think, I mean to a certain extent. Of course, 638 00:36:21,440 --> 00:36:24,840 Speaker 11: the economic situation now is a lot weaker in China, 639 00:36:25,320 --> 00:36:28,080 Speaker 11: but I also think that there is kind of a 640 00:36:28,200 --> 00:36:34,320 Speaker 11: change in the global view from both sides of the continents. 641 00:36:34,400 --> 00:36:37,520 Speaker 11: Right from a US perspective, of course, if you ask 642 00:36:37,560 --> 00:36:39,880 Speaker 11: a medium Phota a few years ago, they would be 643 00:36:39,960 --> 00:36:42,560 Speaker 11: much more pro China. Now today, I think it's sort 644 00:36:42,600 --> 00:36:46,560 Speaker 11: of just across the aisle. People are kind of seeing 645 00:36:46,680 --> 00:36:49,240 Speaker 11: China as a as a threat, more as a competition 646 00:36:49,360 --> 00:36:52,759 Speaker 11: than a friendly kind of trade neighbor. Also from the 647 00:36:52,840 --> 00:36:55,440 Speaker 11: China side, we have to recognize that, I mean, the 648 00:36:55,520 --> 00:36:59,600 Speaker 11: leadership from President she is basically that we have to 649 00:36:59,640 --> 00:37:01,040 Speaker 11: develop our own economy. 650 00:37:01,120 --> 00:37:01,319 Speaker 5: Right. 651 00:37:01,400 --> 00:37:04,399 Speaker 11: They can't rely on the external trade. It can't rely 652 00:37:04,560 --> 00:37:08,240 Speaker 11: on a clio global trade anymore like they've done before, 653 00:37:08,640 --> 00:37:11,680 Speaker 11: and therefore there is a lot more focus on developing 654 00:37:11,680 --> 00:37:14,120 Speaker 11: the domestic economy, and I think that's kind of where 655 00:37:14,120 --> 00:37:16,200 Speaker 11: the government is focusing on now. Of course, in the 656 00:37:16,200 --> 00:37:20,120 Speaker 11: past few months we've seen some gestures of stimulus, but 657 00:37:20,200 --> 00:37:24,479 Speaker 11: I think largely what the market wants is from the 658 00:37:24,520 --> 00:37:28,000 Speaker 11: government to directly stimulate consumption and also investment in that 659 00:37:28,160 --> 00:37:29,160 Speaker 11: so far we haven't seen that. 660 00:37:29,320 --> 00:37:31,520 Speaker 4: So I'm trying to understand Stephanie, whether or not this 661 00:37:31,880 --> 00:37:35,560 Speaker 4: US China trade war will become protracted. Okay, ten percent 662 00:37:35,640 --> 00:37:39,000 Speaker 4: may not be a lot initially, but Trump has already 663 00:37:39,040 --> 00:37:41,640 Speaker 4: said that this tariff could go as high as sixty percent, 664 00:37:41,680 --> 00:37:44,200 Speaker 4: and I'm imagining that that would inflict a lot of 665 00:37:44,280 --> 00:37:46,640 Speaker 4: pain on the export economy in China. 666 00:37:47,080 --> 00:37:51,520 Speaker 11: Yeah, I think. I mean, if eventually sixty percent gets imposed, 667 00:37:52,120 --> 00:37:56,120 Speaker 11: and it gets imposed on the most critical components, then 668 00:37:56,239 --> 00:37:58,839 Speaker 11: I think, yes, of course it will depen growth in China, 669 00:37:58,920 --> 00:38:01,600 Speaker 11: given that export is the very, very important But I 670 00:38:01,600 --> 00:38:04,560 Speaker 11: think we also to remember that also dampests growth and 671 00:38:04,840 --> 00:38:07,160 Speaker 11: push us up inflation potentially in the US as well. 672 00:38:07,480 --> 00:38:10,560 Speaker 11: And I mean Trump administration knows that. 673 00:38:10,080 --> 00:38:13,799 Speaker 4: That was definitely Young chief investment officer at Stashaway and 674 00:38:13,840 --> 00:38:16,279 Speaker 4: I'm Doug Krisner. You can catch us weekdays for the 675 00:38:16,320 --> 00:38:20,520 Speaker 4: Daybreak Asia podcast. It's available wherever you get your podcast. 676 00:38:20,840 --> 00:38:23,600 Speaker 2: Tom. Thank you, Doug. And that does it for this 677 00:38:23,760 --> 00:38:26,360 Speaker 2: edition of Bloomberg day Break Weekend. Join us again Monday 678 00:38:26,360 --> 00:38:28,560 Speaker 2: morning at five am Wall Street Time for the latest 679 00:38:28,560 --> 00:38:31,000 Speaker 2: on markets overseas and the news you need to start 680 00:38:31,040 --> 00:38:34,680 Speaker 2: your day. I'm Tom Buzby. Stay with us. Top stories 681 00:38:34,680 --> 00:38:37,840 Speaker 2: and global business headlines are coming up right now.