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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: This is the Bloomberg Day ba Q podcast. Good morning,

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Speaker 2: It's Monday, the fifteenth of September. I'm Caroline Hepkeitt in London.

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Speaker 1: And I'm Stephen Caroline Brussels. Coming up today, China's economy

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Speaker 1: weakens sharply as expectations mount for Beijing to deliver a

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Speaker 1: stimulus boost.

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Speaker 2: Pressure grows on Kis Starmer as the UK Prime Minister

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Speaker 2: tries to shift focus to Donald Trump's state visits.

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Speaker 1: Plus the Pope uses his first interview to criticize excessive

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Speaker 1: CEO pay and Elon Musk potentially becoming the world's first trillionaire.

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Speaker 2: Let's start with a roundup of our top stories.

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Speaker 1: China's economic activity slowed across the board in August, as

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Speaker 1: industrial output and consumption had their worst month yet this year.

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Speaker 1: Economists now expect a notable slow down in third quarter GDP,

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Speaker 1: with the government's five percent growth target possibly in jeopardy

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Speaker 1: without major stimulus from Beijing. Jinglu is HSBC's chief economists

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Speaker 1: for Greater China.

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Speaker 3: It's actually a big missing across the board. I think

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Speaker 3: all numbers point to the softness in the middle of

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Speaker 3: the year. Probably for Chinese policy makers who are data dependent,

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Speaker 3: they look at this data and probably will start to

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Speaker 3: think about what kind of extra policies they want to

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Speaker 3: roll out.

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Speaker 1: Jing Lou speaking, there is a slew of disappointing data

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Speaker 1: sets in recent weeks already pointed to growing weakness in

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Speaker 1: the economy. A broad measure of creditsload last month for

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Speaker 1: the first time this year, while export growth fell shorter

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Speaker 1: forecasts and dropped to four point four percent in August.

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Speaker 1: The labor market market also likely weakened in recent months,

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Speaker 1: based on purchasing managers index surveys and private polls.

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Speaker 2: US and Chinese representatives discuss trade, national security, and the

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Speaker 2: economy during high level talks in Madrid over the weekend.

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Speaker 2: A senior Treasury officials said the delegations, led by US

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Speaker 2: Treasury Secretary Scott Bessend and Chinese Vice Premier Holy Feng,

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Speaker 2: met for almost six hours yesterday. The fate of the

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Speaker 2: video app TikTok, which is owned by Chinese company Byte,

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Speaker 2: dances on the agenda too. It faces a deadline this

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Speaker 2: week to reach a deal to continue its operations in

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Speaker 2: the US. Champ says that the talks are quote going fine.

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Speaker 2: And Beijing's actions will determine TikTok's future.

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Speaker 4: Negotiating Kicktok right now.

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Speaker 3: We may let it die or we may I don't know.

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Speaker 4: It depends up to China. It doesn't matter too much.

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Speaker 4: I'd like to do it for the kids. They like it.

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Speaker 4: I mean, selfishly speaking, I did very well in TikTok

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Speaker 4: that I got the useful.

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Speaker 2: US persident Donald Champ speaking of their outside Air Force

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Speaker 2: one AS officials are expected to lay the groundwork for

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Speaker 2: a meeting between Trump and Shijingping as soon as October,

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Speaker 2: when they're scheduled to both attend a summit in South Korea.

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Speaker 1: The UK government is defending its decision to sackets ambassador

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Speaker 1: to the US. On the eve of President Trump's visit

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Speaker 1: to Britain, Prime Minister Kris Darmer fired Peter Mandelsson after

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Speaker 1: Bloomberg reported details of private emails showing Mandelsson's ties to

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Speaker 1: disgrace Peterphile Jeffrey Epstein. Business Secretary Peter Kyle told the

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Speaker 1: BBC that the government would not have hired him had

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Speaker 1: they known about the depth of their relationship.

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Speaker 5: In balance based on what was known publicly, based on

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Speaker 5: what we knew and you knew as journalists, the decision

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Speaker 5: was taken to appoint him, and then I have to

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Speaker 5: say that in that period we have navigated the most

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Speaker 5: difficult period in US UK relationships since Second World War,

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Speaker 5: and we have delivered four people in Britain time after

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Speaker 5: time after time.

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Speaker 1: Kyle became Business Secretary two weeks ago in a major

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Speaker 1: government reshuffle. The scandal out threatens to cast a shadow

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Speaker 1: over the three day state visit by President Trump, where

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Speaker 1: the US and UK are expected to sign agreements on

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Speaker 1: nuclear energy and technology.

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Speaker 2: The Federal Reserve is likely to cut interest rates this

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Speaker 2: week for the first time in Donald Trump's second term.

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Speaker 2: Central banks in two fifths of the global economy make

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Speaker 2: rate decisions in the next few days. With the FED

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Speaker 2: scene as a key bell weather, markets are expecting policymakers

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Speaker 2: to line up a series of cuts, but Blueberg opinion

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Speaker 2: columnist John Author says that he's not sure there will

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Speaker 2: be a clear signal.

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Speaker 4: I think it will be an all options open. I

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Speaker 4: don't think we're going to get a really clear dubbish steer.

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Speaker 4: I doubt it will be a particularly hawkish cut either.

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Speaker 4: I don't think there'll be a clear sign that's your

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Speaker 4: lot so much. We still need to find out about

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Speaker 4: whether those tariffs begin to feed through into inflation. They

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Speaker 4: are feeding through into inflation in a very small way

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Speaker 4: thus far, but it's plainly there.

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Speaker 2: Alongside John Orthur's view, the US President has predicted a

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Speaker 2: quote big cut after putting pressure on the Federal Reserve

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Speaker 2: Central banks in Canada, the UK and Japan also announce

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Speaker 2: rate decisions in the thirty six hours after the Fed's decision.

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Speaker 1: Germany's far right party tripled its support in local elections

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Speaker 1: in the country's most populous state, North Rhine Westphalia. The

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Speaker 1: anti immigration Alternative for Germany increased its share of the

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Speaker 1: vote to almost fifteen percent. It remained behind Chancellor Frederick

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Speaker 1: Martz's Christian Democrats and as coalition partners the Social Democrats.

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Speaker 1: The AfD narrowly missed winning the mayoral race in the

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Speaker 1: industrial city of gelsen Kirchen, according to preliminary results. The

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Speaker 1: first electoral test for Mertz's new government came as the

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Speaker 1: Metropolitan Police says between one hundred and ten and one

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Speaker 1: hundred and fifty thousand protesters joined an anti migrant march

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Speaker 1: in central London on Saturday. The protest was organized by

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Speaker 1: the far right activist Tommy Robinson and addressed by Elon.

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Speaker 2: Musk Romania yesterday protested the entry of a Russian drone

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Speaker 2: into its airspace during an attack on neighbouring Ukraine, but

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Speaker 2: Kress summoned Moscow's ambassador to the Foreign Ministry over the incident.

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Speaker 2: The intrusion came only days after Poland said that it

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Speaker 2: had shot down Russian drones that crossed its border. Former

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Speaker 2: US Ambassador to Ukraine, William Taylor says the events show

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Speaker 2: Europe must improve its air defenses along NATO's eastern border.

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Speaker 6: This response by NATO is a good indication of what

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Speaker 6: NATO can do, but it's also a good indication of

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Speaker 6: what NATO needs to do. They need to learn from

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Speaker 6: the Ukraine. Ukrainians know how to knock down drones and

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Speaker 6: doing it without very expensive missiles. The Ukraine's have a

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Speaker 6: lot of experience on this. They get four or five, six,

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Speaker 6: seven hundred a night. While I was in Ukraine, we

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Speaker 6: got eight hundred a night one time in Ukraine, so

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Speaker 6: they know how to knock these down. They have a

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Speaker 6: ninety percent eighty percent success rate. NATO needs to learn

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Speaker 6: from that, and yes, I think NATO could consider putting

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Speaker 6: that kind of cover over the western part of Ukraine.

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Speaker 2: Former US Ambassador to Ukraine William Taylor, speaking there, the

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Speaker 2: EUSE Foreign policy chief Kaya Kalas condemned the each of

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Speaker 2: Romanian airspace as a reckless escalation by Moscow. Meanwhile, US

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Speaker 2: person Trump said over the weekend that he is prepared

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Speaker 2: to move ahead with major sanctions on Russian oil if

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Speaker 2: NATO countries do the same. Trump wrote that replacing fifty

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Speaker 2: two one hundred percent tariffs on China will also be

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Speaker 2: of great help in ending quote, this deadly but ridiculous

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Speaker 2: war in Ukraine.

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Speaker 1: Those are our top stories on the program. On the

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Speaker 1: markets this morning, we're looking at Chinese equities rallying. The

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Speaker 1: CSI three hundred up by six tens of one percent,

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Speaker 1: the MSCI China Index three tents higher today. On currency markets,

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Speaker 1: the Bloomberog Dollars Spot index a little weaker ahead of

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Speaker 1: this week's Federal Reserve decision. The eurostart in the week

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Speaker 1: at one seventeen thirty three, the pound a touch stronger

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Speaker 1: at one thirty five sixty six. Oil prices rising today

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Speaker 1: as well. Looking at briancrudop by half of one percent

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Speaker 1: to sixty seven dollars and thirty three cents.

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Speaker 2: So those other markets. In a moment, we're going to

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Speaker 2: bring you more on the latest day on the state

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Speaker 2: of China's economy. And also Pope Leo. Now he has

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Speaker 2: been talking about Elon Musk's wealth, but then somebody else

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Speaker 2: caught our attention, THEMS.

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Speaker 1: If there's any advantage to getting up in the middle

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Speaker 1: of the night, it's that you get to watch the

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Speaker 1: American Award shows happen as they or rather the results

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Speaker 1: them come in as they happen. So the big headline

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Speaker 1: is that fifteen year old Owen Cooper has become the

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Speaker 1: youngest male to win an Acting Emmy. He won Supporting

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Speaker 1: Actor in a Drama Series for Adolescence of Course, a

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Speaker 1: program that caused huge waves when it aired about a

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Speaker 1: teenage boy arrested for the murder of a female classmate.

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Speaker 1: So that's a big winner from there as well. A

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Speaker 1: couple of other, perhaps more familiar or longer standing names,

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Speaker 1: Noah Wiley winning Best Actor and a Drama for his

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Speaker 1: work on the Pit of Course, became famous n R.

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Speaker 1: So perhaps his type casts A TV doctor Now do anything,

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Speaker 1: I'll ever be allowed to play as well. Some good

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Speaker 1: cameos during the show as well, including the stars The

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Speaker 1: Gilmore Girls Alexis Bleadell and Lauren Graham had a bit

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Speaker 1: the first time they've reunited on stage the reboot of

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Speaker 1: the series. They're making jokes about how long scripts were

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Speaker 1: because famously as a show where the dialogue was very dense.

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Speaker 1: But they're presenting an award for script writing.

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Speaker 2: Okay, so that on the Emmy is good stuff.

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Speaker 1: That's bringing more. Now on that latest economic data from

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Speaker 1: China's we're watching for developments from the trade talks with

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Speaker 1: the US which are happening in Madrid. Our chief aser

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Speaker 1: correspondent to Ros Mathison joins us. Now for more, Ros,

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Speaker 1: let's start them with the data covering August. What picture

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Speaker 1: is emerging of the state of the world's second largest

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Speaker 1: economy from this latest set of numbers.

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Speaker 7: Well, it's a slightly concerning picture because of course we

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Speaker 7: had a bit of front learning, it seems on the

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Speaker 7: export side as we were coming into some of these

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Speaker 7: tariff changes and that potentially supported the Chinese economy. But

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Speaker 7: when you look at the across the board figures today,

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Speaker 7: you know everything from consumption to retail sales to fixed

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Speaker 7: asset investment. It's clear that on the domestic side, consumption

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Speaker 7: demand is slipp and that's you know, an ongoing concern

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Speaker 7: for the government there because really the engine of the

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Speaker 7: of the economy is the domestic side. And you've got

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Speaker 7: across the board, you know, the sense that things are slowing,

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Speaker 7: that people aren't spending, that companies are also not spending.

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Speaker 7: You know, the infrastructure is slowing down. And at the

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Speaker 7: same time, you've got concerns, you know, about the outlook

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Speaker 7: for the housing market, and you know, the need to

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Speaker 7: avoid you know, if you're going to stimulate your economy

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Speaker 7: at this point, not to create bubbles at the same time,

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Speaker 7: which has always been a pattern for China, is to

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Speaker 7: avoid creating patterns both in the in the market and

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Speaker 7: the housing market.

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Speaker 2: Well, does it mean that simulus is more more likely

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Speaker 2: than now? I mean, there's so much anticipation and has

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Speaker 2: been for months about ramping up of simulus.

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Speaker 7: Well, that's right, and they have announced some some steps

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Speaker 7: on that front, but it seems every time they announce

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Speaker 7: the stimulus package it does disappoint the market, which is

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Speaker 7: looking for more. I mean, they do have some leavers

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Speaker 7: they can use. There's the interest rates. There's also that,

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Speaker 7: you know, the way that they set the yuan, which

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Speaker 7: can be a factor as well. They could lean into

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Speaker 7: infrastructure spending and try and push up infrastructure again because

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Speaker 7: that can be a good way to get broad leavers

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Speaker 7: of the economy moving. But again, you know, in all

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Speaker 7: of that, you've got to be careful not to speed

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Speaker 7: things up too much, and certainly not to overheat certain

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Speaker 7: sectors of the economy, including the housing market where they're very,

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Speaker 7: very sensitive to the potential for bubbles. And of course

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Speaker 7: the stock market's been doing fairly well after a rough

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Speaker 7: start this year, and there is concern about letting some

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Speaker 7: of the air out of the stock market without again

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Speaker 7: crushing it too quickly or anything. So there's a lot

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Speaker 7: of delicate things there to balance in terms of stimulus,

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Speaker 7: but certainly the expectation is that they need to do

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Speaker 7: something pretty pretty soon.

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Speaker 1: At the same time, or watching for any news out

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Speaker 1: of the latest brand of US China trade talks happening

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Speaker 1: in Madrid, what have they've been discussing so far and

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Speaker 1: what sort of progress could we expect.

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Speaker 7: Well, they met for about six hours yesterday and then

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Speaker 7: some lower level officials kept talking last night, so there's

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Speaker 7: a lot of conversation at least going on, and obviously

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Speaker 7: talks resuming today. Scott Bessent, the US Treasury Secretary, does

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Speaker 7: have to get to the UK at some point because

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Speaker 7: Donald Trump is visiting this week, but there is room

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Speaker 7: for further talks at least through today. It's a bit

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Speaker 7: of a grab bag of stuff they're discussing. Includes TikTok,

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Speaker 7: because that's a deadline that's coming up yet again. I mean,

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Speaker 7: Donald Trump has rolled it over multiple times and maybe

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Speaker 7: he does so again, but also the broader China US

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Speaker 7: trade trups has a deadline that's coming. And the idea

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Speaker 7: behind all of this seems to be to get everything

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Speaker 7: knitted away, to have a summit between Donald Trump and Cigping,

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Speaker 7: probably late October in Asia, perhaps around the time of

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Speaker 7: the APEC summit in Korea. And to do that, you've

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Speaker 7: got to get a proper understanding of where this trade

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Speaker 7: truce is going and what a formal deal that's not

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Speaker 7: just a temporary deal is going to look like so

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Speaker 7: the two of them can then announce it at their summit.

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Speaker 7: That's the whole goal is to get everything squared away

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Speaker 7: so they can present something together at this summit. So

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Speaker 7: there's being conversations not just around TikTok, but obviously all

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Speaker 7: the parameters of the trade deal and a lot of

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Speaker 7: other stuff too still like fentanyl and so on.

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Speaker 2: Okay, so something will continue to think about.

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Speaker 6: Rolls.

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Speaker 2: Thank you so much for being with us. That is

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Speaker 2: Roll's Matheson, Bloomberg's chief Asia correspondent. Thank you so much,

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Speaker 2: stay with us. More from Bloomberg dbakeup coming up after this.

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Speaker 2: The Pope has singled out Elon Musk's wealth as part

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Speaker 2: of criticism of the widening pay gap between company bosses

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Speaker 2: and working class people. Pope Leo was speaking to the

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Speaker 2: Catholic news website Croux in his first interview since becoming

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Speaker 2: pontif I reported to you at a bio Jones is

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Speaker 2: now for more on this story, Teva. What did the

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Speaker 2: Pope have to say about Elon Musk?

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Speaker 8: Well, yeah, Caroline, this was an interview that he gave

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Speaker 8: to the Catholic website Crux over the summer, shortly after

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Speaker 8: he began became pope, but it was published over the

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Speaker 8: weekend for his seventieth birthday, and the interview's actually part

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Speaker 8: of an upcoming biography being written about him published by

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Speaker 8: Penguin Peru, and he discussed a range of things, but

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Speaker 8: amongst those was the widening pay gap that he sees

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Speaker 8: between corporate bosses and their staff, and to illustrate this,

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Speaker 8: he used Elon Musk as an example, pointing out that

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Speaker 8: he was set to become the first trillionaire in the world.

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Speaker 8: Those comments were made just weeks before Tesla unveiled a

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Speaker 8: plan which could see Musk awarded a trillion dollars over

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Speaker 8: the next decade if he hits a series of corporate

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Speaker 8: targets at Tesla. But it's important to point out that

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Speaker 8: Pope Leo made clear in this interview that Elon Musk

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Speaker 8: isn't the only example of this waridening pay gap that

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Speaker 8: he sought to emphasize. It was really more of a

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Speaker 8: commentary on the direction that the world is going and

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Speaker 8: this increasing focus on wealth that he describes, and he

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Speaker 8: talks about that focus contributing to what he says is

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Speaker 8: a loss of a higher sense of what human life

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Speaker 8: is about. So really a wide ranging interview which covered,

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Speaker 8: amongst many things, the wealth inequality that Pope Leo sees

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Speaker 8: in the world.

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Speaker 1: How unusual is it to hear these kinds of comments

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Speaker 1: from a pope.

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Speaker 8: To it's not entirely unusual to hear these comments from

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Speaker 8: a pope. It's in line with the theology that his predecessor,

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Speaker 8: Pope Francis, who was notoriously frugal, promoted. Back in twenty

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Speaker 8: twenty two, in the wake of the pandemic, Pope Francis

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Speaker 8: appealed to entrepreneurs to share wealth, citing the biblical example

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Speaker 8: of the Good Samaritan who offered charity to a stranger.

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Speaker 8: He also challenged financial leaders to help push forward international development,

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Speaker 8: and he also condemned tax breaks for the wealthy. So

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Speaker 8: it's definitely something we've seen before from a pope, but indeed,

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Speaker 8: more broadly than economic affairs, we also heard Pope frances

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Speaker 8: speak very often, almost up until his death about geopolitical

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Speaker 8: affairs such as the war in Ukraine and in the

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Speaker 8: Middle East. So this sort of commentary is not outside

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Speaker 8: the realm of what we might expect from a pope.

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Speaker 8: But for Pope Leo at least, I think it does

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Speaker 8: set the tone for the rest of his papacy, and

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Speaker 8: actually it's consistent with his theology to date. I mean,

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Speaker 8: he chose the name Pope Leo in recognition of the

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Speaker 8: previous pop Leo who served during the eighteen hundreds, and

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Speaker 8: he was known for promoting labor rights during the Industrial Revolution,

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Speaker 8: so perhaps we should have had an inclination that this

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Speaker 8: pop Leo would also speak out about similar issues.

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Speaker 2: That is interesting in terms of what else he said

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Speaker 2: in the interview what stood out well.

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Speaker 8: I mean, it was very wide ranging. He even criticized

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Speaker 8: the UN for a lack of EA efficacy when it

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Speaker 8: comes to international affairs, and he gave us some insight

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Speaker 8: about how he's adapting to the role of pope. He

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Speaker 8: said it's a huge learning curve. But he also added

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Speaker 8: some interesting anecdotes about feeling both American and Peruvian. Of course,

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Speaker 8: he was born in Chicago but spent twenty years as

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Speaker 8: a missionary in Peru. He even spoke about his childhood

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Speaker 8: as a fan of the baseball team, the White Sox,

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Speaker 8: and how he learned about tolerance from an early age

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Speaker 8: because his mum supported the rival Cubs team. But I

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Speaker 8: think what was really interesting from my perspective is that

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Speaker 8: he talked about being thrust into the role of a

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Speaker 8: world leader as pope, and that perhaps suggests a commitment

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Speaker 8: to engage politically as part of his papacy. It certainly

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Speaker 8: tells us a bit about how he sees his role

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Speaker 8: as Pontifex, and perhaps will give us some insight into

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Speaker 8: the future in terms of how he intends to carry

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Speaker 8: out this job as head of the Catholic Church.

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Speaker 1: This is Bloomberg Daybreak Europe. You're more brief on the

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