WEBVTT - Daybreak Weekend: Jobs Preview, Paris Conference, BOJ Decision 0:00:00.240 --> 0:00:07.680 Bloomberg Audio Studios, Podcasts, radio news. 0:00:10.400 --> 0:00:13.319 This is Bloomberg Daybreak Weekend, our global look at the 0:00:13.400 --> 0:00:15.960 top stories in the coming week from our Daybreak anchors 0:00:16.040 --> 0:00:18.560 all around the world. Straight Ahead on the program, we'll 0:00:18.560 --> 0:00:21.640 look to US non farm payrolls for November and earnings 0:00:21.640 --> 0:00:24.960 from sneaker giant Nike. I'm Nathan Hager in Washington. 0:00:25.120 --> 0:00:27.760 I'm Callie hepkea Hey in London, where we discussed at 0:00:27.760 --> 0:00:32.240 Europe's business and political challenges in the face of US criticism. 0:00:32.440 --> 0:00:34.960 I've Dot Krisner looking at the likelihood of a rate 0:00:35.040 --> 0:00:36.560 increase from the Bank of Japan. 0:00:38.240 --> 0:00:42.280 That's all straight ahead on Bloomberg Daybreak Weekend on Bloomberg 0:00:42.320 --> 0:00:46.000 eleven three year, New York, Bloomberg ninety nine to one, Washington, DC, 0:00:46.520 --> 0:00:51.520 Bloomberg ninety two nine, Boston, DAB Digital Radio, London, Syria 0:00:51.800 --> 0:00:55.320 XM one twenty one, and around the world on Bloomberg Radio, 0:00:55.360 --> 0:00:57.560 dot Com and the Bloomberg Business app. 0:01:02.760 --> 0:01:05.360 Good day to you. I'm Nathan Hagar. We begin today's 0:01:05.400 --> 0:01:09.280 program with US jobs numbers. Non farm payrolls for the 0:01:09.319 --> 0:01:12.720 month of November are due out Tuesday at eight thirty am. 0:01:12.760 --> 0:01:15.119 Wall Street Time For more and what to expect. We're 0:01:15.200 --> 0:01:19.080 joined by Michael McKee, international economics and policy correspondent for 0:01:19.080 --> 0:01:23.399 Bloomberg Radio and Television. First off, Mike, I don't really 0:01:23.440 --> 0:01:28.040 remember having a job's Tuesday before the government shutdowns really 0:01:28.120 --> 0:01:29.400 changed things, an't it? 0:01:29.400 --> 0:01:31.440 It really has? Somebody said the other day, given the 0:01:31.520 --> 0:01:33.959 schedule for the releasing all the data that we didn't 0:01:33.959 --> 0:01:37.480 get before, that it's soon going to be twenty twenty six, 0:01:37.560 --> 0:01:40.640 except at the Bureau of Labor Statistics, we'll still be 0:01:40.680 --> 0:01:42.600 twenty twenty five for quite some time. 0:01:43.040 --> 0:01:47.080 So what are we expecting with the numbers do out 0:01:47.520 --> 0:01:51.280 this coming Tuesday on a delayed schedule then. 0:01:51.680 --> 0:01:53.320 Well, to be totally honest, we're expecting a lot of 0:01:53.360 --> 0:01:57.560 confusion because what they're doing is trying to put out 0:01:57.600 --> 0:02:01.960 as much of the October report in terms of the 0:02:02.080 --> 0:02:05.760 Establishment survey, where they count how many jobs as they can, 0:02:05.960 --> 0:02:09.280 but they don't have complete data. And then they're going 0:02:09.360 --> 0:02:14.640 to put out the November payrolls report with most of 0:02:14.680 --> 0:02:17.200 the data that they need, but we're going to have 0:02:17.240 --> 0:02:21.120 to parse two months there together, and some of it 0:02:21.160 --> 0:02:24.480 won't even the data won't even be there, so we're 0:02:24.480 --> 0:02:25.720 going to have to take it with a bit of 0:02:25.760 --> 0:02:29.360 a grain of salt, but it will give us a 0:02:29.400 --> 0:02:32.200 better view of sort of where we are right now. 0:02:32.200 --> 0:02:33.760 The biggest issue is going to come on the other 0:02:33.840 --> 0:02:36.720 side the household survey, which gives us the unemployment rate, 0:02:36.720 --> 0:02:39.320 because there's no data for October, so they've got to 0:02:39.400 --> 0:02:42.720 jump right into November, and they didn't get started questioning 0:02:42.760 --> 0:02:46.919 people until the end of November, which creates some statistical 0:02:47.600 --> 0:02:53.919 anomalies that are probably too nerdy to talk about. But 0:02:54.760 --> 0:02:58.520 it's going to be a rough report to make a 0:02:58.520 --> 0:02:59.040 lot out of. 0:02:59.280 --> 0:03:03.520 Okay, So since we have those holes in the household survey, 0:03:04.000 --> 0:03:06.359 even with the November numbers coming out, does that raise 0:03:06.400 --> 0:03:09.239 some questions in the market about what the reliability even 0:03:09.280 --> 0:03:10.200 of the November data. 0:03:11.080 --> 0:03:14.840 It should and J. Powell in his news comforts this 0:03:14.919 --> 0:03:17.880 past week said the very same thing, that the FED 0:03:18.000 --> 0:03:21.000 is going to have to really analyze this and not 0:03:21.080 --> 0:03:24.200 take it at face value because they understand the statistical 0:03:24.240 --> 0:03:25.560 issues that are involved. 0:03:26.080 --> 0:03:26.240 Now. 0:03:26.280 --> 0:03:29.040 The good thing is for the FED they don't meet 0:03:29.080 --> 0:03:34.560 again until January twenty eighth, and so therefore they will 0:03:34.560 --> 0:03:37.480 have the December numbers, which will be a complete report 0:03:37.760 --> 0:03:40.480 at least to go on before they have to make 0:03:40.520 --> 0:03:44.400 another decision, but we will get more information than we 0:03:44.520 --> 0:03:48.120 have had, and in certain categories of jobs, will get 0:03:48.400 --> 0:03:50.560 good information because a lot of that stuff comes in 0:03:50.640 --> 0:03:54.480 electronically wasn't affected by the government shutdown. But there will 0:03:54.520 --> 0:03:57.119 be gaps in the numbers for October November. 0:03:57.400 --> 0:03:59.760 So in terms of the gaps that are meant to 0:03:59.760 --> 0:04:03.240 be filled here, what particularly are you looking for that 0:04:03.520 --> 0:04:06.400 is going to be filled in and what's your expectation there. 0:04:07.000 --> 0:04:13.320 Big companies, manufacturing companies, people like that, and large retailers. 0:04:13.760 --> 0:04:16.479 They have computerized records that they send in to the 0:04:16.480 --> 0:04:20.720 Bureau Labor Statistics, so those kinds of numbers will show up. 0:04:20.920 --> 0:04:23.520 It's going to be harder for them to count things 0:04:23.600 --> 0:04:28.799 that are at small businesses which are surveyed but don't 0:04:28.839 --> 0:04:35.320 necessarily send in their stuff electronically, or construction workers because 0:04:35.360 --> 0:04:38.599 they're sort of itinerant and can be from job to job. 0:04:39.040 --> 0:04:41.360 And home healthcare workers, now that's going to be interesting 0:04:41.400 --> 0:04:45.320 because home healthcare has been the biggest job creator in 0:04:45.320 --> 0:04:48.719 the last few years, and so we might get a 0:04:48.760 --> 0:04:51.799 distorted number there that would kind of throw off the total. 0:04:52.240 --> 0:04:54.640 In terms of the data that we've gotten from the 0:04:54.640 --> 0:04:59.440 private sector, so far, we've seen all sorts of ADP figures, 0:04:59.480 --> 0:05:03.640 the Challenge Grain, Christmas layoff notices as well. What does 0:05:03.680 --> 0:05:06.800 that tell us about what we could see from the 0:05:06.839 --> 0:05:08.760 rest of the data that's coming from the BLS. 0:05:09.200 --> 0:05:11.159 I think all that will tell you is that they 0:05:11.240 --> 0:05:14.760 sort of confirm the idea that the hiring environment has 0:05:14.839 --> 0:05:18.720 slowed a lot. Neither one of them is a particularly 0:05:18.800 --> 0:05:23.440 good predictor of what the overall BLS numbers will be. 0:05:24.400 --> 0:05:28.680 It's just kind of gives you some data. They give 0:05:28.720 --> 0:05:32.400 you a direction, but not necessarily a magnitude. So I 0:05:32.440 --> 0:05:35.599 don't think we go into it with a completely clear 0:05:36.040 --> 0:05:38.640 expectation for what the numbers are going to be. The 0:05:38.839 --> 0:05:43.240 consensus forecast at Bloomberg has absolutely economists is for forty 0:05:43.320 --> 0:05:47.120 thousand jobs, but again, you know that's combining two months, 0:05:47.120 --> 0:05:49.120 so there might be job losses in one month and 0:05:49.200 --> 0:05:52.120 job gains in another month, and it's really hard to 0:05:52.480 --> 0:05:55.359 know where we end up. You kind of just have 0:05:55.440 --> 0:05:56.520 to take it as it comes. 0:05:56.920 --> 0:05:59.040 And you mentioned that there's going to be kind of 0:05:59.080 --> 0:06:02.479 a hole in the unemployment rate with the household survey 0:06:02.680 --> 0:06:05.280 on hold due to the shutdown, But what's the trend 0:06:05.720 --> 0:06:08.080 when it comes to the unemployment rate. Are we seeing 0:06:08.120 --> 0:06:10.520 more people getting into the job market. 0:06:11.240 --> 0:06:14.720 Well, we see the last data we have is from September, 0:06:14.760 --> 0:06:17.839 and more people did go into the labor market, and 0:06:17.839 --> 0:06:19.960 that's one reason that the unemployment rate went up a 0:06:19.960 --> 0:06:23.400 bit in September. We don't know what has happened since. 0:06:23.440 --> 0:06:25.440 And one of the issues is of course that the 0:06:25.680 --> 0:06:30.279 administration is deporting as many people as they can, deport 0:06:30.360 --> 0:06:32.840 as fast as they can, and that's cutting down on 0:06:32.880 --> 0:06:35.320 the size of the labor force. But we don't have 0:06:35.520 --> 0:06:39.640 exact figures, so that will also be an interesting aspect 0:06:39.839 --> 0:06:44.200 of these reports to see whether or not we're losing 0:06:44.279 --> 0:06:48.240 workers or losing potential workers because they have been kicked 0:06:48.240 --> 0:06:52.919 out of the country. That would raise probably raise the 0:06:53.120 --> 0:06:57.280 unemployment rate. So there are some other concerns. One thing 0:06:57.320 --> 0:07:00.840 I didn't mention is that a lot of the people 0:07:00.880 --> 0:07:05.200 who were fired by DOGE or took early retirement because 0:07:05.320 --> 0:07:07.560 they thought they were going to get fired, They were 0:07:07.600 --> 0:07:09.720 on the payrolls till the end of the fiscal year, 0:07:10.200 --> 0:07:14.400 which was September thirtieth, so we could see a big 0:07:14.520 --> 0:07:18.840 drop in government payrolls in the month of October, and 0:07:18.920 --> 0:07:22.480 that would have the effect of depressing the whole thing, 0:07:23.080 --> 0:07:29.320 and it might increase unemployment numbers some but it looks 0:07:29.360 --> 0:07:31.800 like at this point not a whole lot. But it 0:07:31.840 --> 0:07:35.280 does complicate even more the whole task of sorting all 0:07:35.280 --> 0:07:35.720 this out. 0:07:36.080 --> 0:07:39.200 Now lots to sort out. I had of jobs Tuesday. 0:07:39.480 --> 0:07:43.760 Thanks Mike, appreciate this. That's Michael McKee, Bloomberg International Economics 0:07:43.800 --> 0:07:47.920 and Policy correspondent. We moved next to corporate earnings from Nike, 0:07:48.200 --> 0:07:51.960 the sneaker giant report's second quarter results on Thursday. For 0:07:52.080 --> 0:07:54.800 more on what to expect, it's got to be Putam Goyle, 0:07:54.960 --> 0:07:58.400 senior US e commerce and retail analysts at Bloomberg Intelligence, 0:07:58.680 --> 0:08:01.520 put them thanks for being here. The Swish has kind 0:08:01.520 --> 0:08:04.440 of been crushed lightly by the competition, hasn't it. So 0:08:04.960 --> 0:08:06.800 what are we expecting this time around from Nike? 0:08:07.320 --> 0:08:07.520 Yeah? 0:08:07.560 --> 0:08:10.080 I think right now we're just holding tight, kind of 0:08:10.080 --> 0:08:12.960 waiting for the turnaround to take shape. We think Nike 0:08:13.400 --> 0:08:17.120 is making all the right moves to get itself back 0:08:17.160 --> 0:08:20.720 on track. That said, earnings will be a little light, 0:08:21.040 --> 0:08:24.200 and that's as expected. We do expect sales to fall 0:08:24.400 --> 0:08:27.440 turn negative again in fiscal two Q slipping by low 0:08:27.480 --> 0:08:30.400 single digits and that's after it posted a slight gain 0:08:30.640 --> 0:08:33.719 in the last quarter. I'm not so worried about that. 0:08:33.840 --> 0:08:38.560 My main concern is, is Nike moving forward on clearing inventories. 0:08:39.120 --> 0:08:42.200 Is Nike innovating to draw full price sales of the 0:08:42.240 --> 0:08:44.520 new stuff that it's introducing and it is. 0:08:45.080 --> 0:08:47.680 So you say that Nike is doing the right things 0:08:47.760 --> 0:08:50.760 to do that turnaround, talk a little bit more about 0:08:50.840 --> 0:08:54.200 what you're seeing. Why you think Nike might be getting 0:08:54.280 --> 0:08:57.800 back on the front foot to keep using puns. 0:08:58.240 --> 0:09:01.400 Yeah, I guess you know. The big II guest move 0:09:01.480 --> 0:09:04.720 for me that they are making to right size the 0:09:04.760 --> 0:09:10.079 brand is right sizing inventories. Inventories have been very elevated 0:09:10.120 --> 0:09:13.280 for Nike for a few years now, and just bringing 0:09:13.320 --> 0:09:16.280 them down and really getting them to realign with sales 0:09:16.480 --> 0:09:19.600 is the number one factor that I'm looking for, to 0:09:19.760 --> 0:09:22.200 have them kind of pick out everything that's old, that 0:09:22.280 --> 0:09:25.120 they made too much of and that wasn't working, to 0:09:25.200 --> 0:09:28.480 really bring in the new stuff more mainstream. The other 0:09:28.600 --> 0:09:31.360 thing is innovation. So when you think about what Nike 0:09:31.559 --> 0:09:34.360 was doing just you know, three to five years ago, 0:09:34.760 --> 0:09:37.800 it was just introducing the same thing with a different 0:09:37.840 --> 0:09:40.320 color wave. That's simply I mean they were doing a 0:09:40.320 --> 0:09:42.880 lot of other things, but there just wasn't as much 0:09:42.920 --> 0:09:47.160 innovation as the customer demanded. I think that's changing. I 0:09:47.200 --> 0:09:50.679 think they are adding more performance, more innovation to their 0:09:50.720 --> 0:09:53.880 product lineup. I also think that they're going back on 0:09:53.920 --> 0:09:56.880 the playing field. So you know, one question that I 0:09:56.880 --> 0:10:01.480 get asked often is how did Life let Hoka and 0:10:01.559 --> 0:10:05.559 the ads take share from it? And the best answer 0:10:05.600 --> 0:10:08.080 I could give is it's because they weren't on the field. 0:10:08.360 --> 0:10:10.760 They weren't where the runners were. They kind of took 0:10:10.760 --> 0:10:13.760 a back seat in the sport and they focused on 0:10:13.800 --> 0:10:17.560 digital too aggressively. That's all changed. They're back on the field, 0:10:17.679 --> 0:10:21.640 they're at the runs, they have shoes that the runners 0:10:21.679 --> 0:10:24.760 are wearing, they're showing off and quite honestly, they are 0:10:24.920 --> 0:10:27.920 competitive and they are just as good, if not better 0:10:27.960 --> 0:10:29.960 than some of what's out there in the competition. 0:10:30.160 --> 0:10:32.439 Well, that's been the thing, right because there has been 0:10:32.480 --> 0:10:36.160 so much attention on these upstart sneaker makers. You mentioned 0:10:36.160 --> 0:10:38.720 Hoka and On coming out with these more I guess 0:10:38.760 --> 0:10:42.079 innovative products compared to what Nike's product line has been 0:10:42.120 --> 0:10:44.840 over the last few years. What is it that Nike's doing, 0:10:44.880 --> 0:10:48.520 What kind of changes. Is it making to sort of 0:10:48.600 --> 0:10:49.920 meet up with that competition. 0:10:50.559 --> 0:10:53.880 It's being where the runners are. It's very simple. It's 0:10:53.920 --> 0:10:55.640 back to one on one. It's we need to be 0:10:55.920 --> 0:10:59.079 on the running grounds. We need to be at the races. 0:10:59.400 --> 0:11:01.800 We need to have the runners wear our shoes and 0:11:02.600 --> 0:11:05.520 believe that they are the best shoes or that's for 0:11:06.080 --> 0:11:08.280 They're doing all of that now. It's just a matter 0:11:08.320 --> 0:11:10.000 of time. I think we'll start to see it in 0:11:10.040 --> 0:11:11.960 the results. The other thing I would say is, you know, 0:11:12.000 --> 0:11:15.120 we talk about these emerging brands or I guess these 0:11:15.520 --> 0:11:18.440 newer brands taking share, but when you think of the 0:11:18.480 --> 0:11:22.320 market share that Nike holds given its size, it's still 0:11:22.400 --> 0:11:25.760 the number one footwear brand in the world. And we 0:11:25.840 --> 0:11:30.160 ran a survey at BI just last month asking consumers, 0:11:30.880 --> 0:11:34.760 when you shop for sneakers, especially athletic sneakers, who do 0:11:34.800 --> 0:11:38.800 you wear? Nike was still number one, And yes, Toka 0:11:38.840 --> 0:11:42.920 and On are definitely gaining traction, but Nike leads still 0:11:42.920 --> 0:11:43.960 by a wide margin. 0:11:44.920 --> 0:11:47.680 Is Nike putting out the kind of product that sneaker 0:11:47.720 --> 0:11:50.600 heads are still willing to pay top dollar for. I 0:11:50.640 --> 0:11:55.360 know some of these models can really drive into pretty 0:11:55.440 --> 0:11:58.440 high price points. Is that something that Nike is able 0:11:58.480 --> 0:11:58.800 to meet. 0:11:59.200 --> 0:12:00.719 Yeah, I think so. And if you think about the 0:12:00.760 --> 0:12:04.480 price points that Nike is launching these new products, that 0:12:04.760 --> 0:12:08.040 they're pretty competitive with what's out there in the competition. 0:12:08.520 --> 0:12:11.040 So they The nice thing about Nike is that they 0:12:11.160 --> 0:12:13.760 have a range of price points, right, So if you 0:12:13.800 --> 0:12:16.680 want to buy sneakers starting at seventy eighty dollars, you 0:12:16.760 --> 0:12:18.679 can at that one hundred dollars price point, but you 0:12:18.720 --> 0:12:20.880 can go as high as up to two forty two 0:12:20.920 --> 0:12:24.520 fifty two for like the most premium sneaker that they offer. 0:12:24.840 --> 0:12:27.440 And when you think about the competition, I think they 0:12:27.480 --> 0:12:29.959 do too. Offer sneakers, you know, in the one hundred 0:12:30.000 --> 0:12:31.920 and forty hundred and sixty a north of two hundred 0:12:31.960 --> 0:12:34.400 dollars range and depending on the style that you're looking at. 0:12:34.720 --> 0:12:37.240 Really appreciate this, Punum, thanks again for being with us. 0:12:37.360 --> 0:12:40.720 That's Punam Goyle, senior US e Commerce and retail analyst 0:12:40.840 --> 0:12:44.280 at Bloomberg Intelligence. And coming up on Bloomberg Day Break weekend, 0:12:44.360 --> 0:12:47.320 we'll look at Europe's business and political challenges in the 0:12:47.360 --> 0:12:51.920 face of US criticism. I'm Nathan Hager, and this is Bloomberg. 0:13:03.840 --> 0:13:06.800 This is Bloomberg Daybreak weekend our global look ahead at 0:13:06.840 --> 0:13:09.360 the top stories for investors in the coming week. I'm 0:13:09.440 --> 0:13:12.280 Nathan Hager in Washington. Up later in the program, we'll 0:13:12.280 --> 0:13:15.360 look at whether the Bank of Japan will raise interest rates. 0:13:15.600 --> 0:13:19.000 But first, in the coming days, global leaders convene in 0:13:19.040 --> 0:13:21.800 France at the Conference of Paris. It is an annual 0:13:21.840 --> 0:13:24.920 gathering in the City of Light which encourages knowledge sharing 0:13:24.960 --> 0:13:28.200 on economic, social and environmental issues in the hope of 0:13:28.200 --> 0:13:32.199 collaboration to overcome the world's challenges. I Meanwhile, political leaders 0:13:32.240 --> 0:13:35.200 are gearing up for the European Council meetings, where priorities 0:13:35.240 --> 0:13:38.280 will be on Ukraine and its security. For more, Let's 0:13:38.320 --> 0:13:41.960 go to London and bring in Bloomberg Daybreak europe Anker Caroline. 0:13:41.520 --> 0:13:46.679 Hepger Nathan Europe is facing complicated times a week economy, 0:13:46.800 --> 0:13:49.760 the war in Ukraine, and a strained relationship with the 0:13:49.800 --> 0:13:55.320 Trump White House, three persistent and intertwined challenges the continent 0:13:55.360 --> 0:13:59.160 has grappled with throughout twenty twenty five. The region's leaders 0:13:59.200 --> 0:14:02.480 are deeply concerned by US efforts to end the nearly 0:14:02.559 --> 0:14:05.960 four years long conflict in Ukraine by cutting a deal 0:14:06.000 --> 0:14:10.720 with the aggressor Russia. But what action can European leaders take? 0:14:11.440 --> 0:14:14.960 From JD Vance's speech at the Munich Security Conference in 0:14:15.000 --> 0:14:19.440 February through to the thirty three page national Security strategy 0:14:19.880 --> 0:14:25.440 signed by President Trump that claims Europe risks civilizational erasure, 0:14:25.960 --> 0:14:29.880 the issue for Europe, according to JP Morgan CEO Jamie Darmon, 0:14:30.480 --> 0:14:36.040 is anti business, bureaucracy, internal fragmentation, and a lack of innovation. 0:14:36.560 --> 0:14:39.640 He told Bloomberg's Caroline Hyde that Europe needs to make 0:14:39.840 --> 0:14:41.560 serious changes to survive. 0:14:42.360 --> 0:14:44.560 I think Europe has a real problem. You know, it's 0:14:44.640 --> 0:14:46.280 very hard to look at the world and you know, 0:14:46.480 --> 0:14:49.520 have we have movie tectonic plays you've seen, you've heard 0:14:49.680 --> 0:14:53.440 spoken about AI, the enemies in the satellite up above 0:14:53.640 --> 0:14:56.320 and in your computer systems right now, you know, and 0:14:57.360 --> 0:14:59.960 the world change, the other tectonic plays, a rise of China, 0:15:00.640 --> 0:15:05.280 huge global deficits, social network programs that probably can't be 0:15:05.360 --> 0:15:08.880 maintained over a long period of time. So Europe has 0:15:08.920 --> 0:15:11.800 a problem. I think they accomplished an unbelievable thing with 0:15:11.960 --> 0:15:15.280 when they put the euro got together the EC and 0:15:15.320 --> 0:15:17.440 they said, you know, let's live in peace and not war. 0:15:17.520 --> 0:15:19.040 You know, they had World War One and World War two, 0:15:19.080 --> 0:15:22.040 but they had them. They frankop Preussian Wars, the Napoleonic Wars, 0:15:22.040 --> 0:15:23.920 the One Hundred Years of War, the War the Roses, 0:15:24.320 --> 0:15:26.080 you know, and so living in piece is a good thing, 0:15:26.320 --> 0:15:29.600 but it got bogged down. They never finished the Common Market. 0:15:30.320 --> 0:15:33.520 It takes twenty seven nations, you know, to make a decision. 0:15:34.520 --> 0:15:39.440 They let their military drop dramatically. It's very bureaucratically wide. 0:15:39.520 --> 0:15:41.480 Part of the reason that, you know, they lost Britain 0:15:41.560 --> 0:15:43.600 to the EU, which I think makes it bad for 0:15:43.640 --> 0:15:45.560 both of them, by the way, And so you got 0:15:45.600 --> 0:15:48.120 to be honest about this. So in those tectonic plays 0:15:48.280 --> 0:15:51.920 may move over twenty years, but if we ever write 0:15:51.960 --> 0:15:54.640 a book about how the West was lost, it will 0:15:54.680 --> 0:15:57.200 be because of the following. It will because of we 0:15:57.240 --> 0:15:59.200 didn't get her act together here, and we go through 0:15:59.200 --> 0:16:01.920 all the policies here, that we didn't have the strongest 0:16:01.960 --> 0:16:04.240 military in the world, and that we allowed Europe to 0:16:04.280 --> 0:16:05.200 fall apart. 0:16:05.360 --> 0:16:08.000 That was JP Morgan CEO Jamie Dimond speaking there to 0:16:08.000 --> 0:16:13.400 Bloomberg's Caroline Hyde. At the Reagan National Defense Forum, questions 0:16:13.440 --> 0:16:17.840 of European security and collaboration with the US will be 0:16:18.040 --> 0:16:21.920 major points of discussion at the Conference of Paris in 0:16:21.960 --> 0:16:25.360 the next few days. Speakers include Bruno Lemaire, the former 0:16:25.400 --> 0:16:29.160 French Economy and Finance Minister, and Ken Griffin, CEO and 0:16:29.200 --> 0:16:32.160 founder of Citadel. It's also an issue that will be 0:16:32.200 --> 0:16:35.080 on the minds of leaders at the upcoming EU Leader's 0:16:35.160 --> 0:16:38.680 Summit in Brussels. Well, joining me now for more is 0:16:38.720 --> 0:16:43.640 Ben Sils, Bloomberg's managing editor for European Government and Economy. Ben, 0:16:43.720 --> 0:16:46.240 good to speak to you. Firstly, I'd just like your 0:16:46.280 --> 0:16:50.520 reaction to what Jamie Diamond had to say. Really, his 0:16:50.640 --> 0:16:54.560 comments have dominated news in Europe over the past few days, 0:16:54.600 --> 0:16:57.160 saying that Europe has a big problem. What do you 0:16:57.200 --> 0:17:00.960 think the response and the thinking is in Brussels and 0:17:01.000 --> 0:17:02.200 across Europe. 0:17:02.600 --> 0:17:06.240 Well, I think he's right. For starters, I think most people, 0:17:06.720 --> 0:17:10.720 most European officials will recognize that he's right. He's not 0:17:10.760 --> 0:17:14.040 the first person to say this, but when somebody as 0:17:15.040 --> 0:17:18.880 influential as Jamie Dammon makes that sort of comment so publicly, 0:17:18.920 --> 0:17:25.160 it has to sting. I think that will it will 0:17:25.160 --> 0:17:29.159 it lead to a bit more soul searching. I'm not 0:17:29.200 --> 0:17:31.320 really sure. To be honest, I think that the Draggy 0:17:31.400 --> 0:17:37.840 report last year was arguably a more substantial and more 0:17:37.920 --> 0:17:43.359 kind of conspicuous call to arms for European officials, and 0:17:43.400 --> 0:17:46.119 the progress on the back of that has been limited, 0:17:46.680 --> 0:17:51.399 and the progress on so many of the critical files 0:17:51.400 --> 0:17:57.120 for the European Union has has continued to be kind 0:17:57.119 --> 0:18:01.920 of plagued by the same old problems of the need 0:18:02.000 --> 0:18:06.960 for consensus, like the divisions over the sort of kind 0:18:06.960 --> 0:18:09.480 of vision of the sort of European economy that people 0:18:09.520 --> 0:18:12.440 want to build and that just kind of constantly holds 0:18:12.560 --> 0:18:14.560 the European Union back. 0:18:14.800 --> 0:18:18.080 Do you think that it is something that European leaders 0:18:18.080 --> 0:18:22.240 are going to think about at this EU Council meeting 0:18:22.600 --> 0:18:24.600 or at the conference of Paris, where we're going to 0:18:24.640 --> 0:18:30.840 see again a number of leading US CEOs speaking to Bloomberg, 0:18:31.080 --> 0:18:34.800 speaking to the investor community. We know that the drug 0:18:34.960 --> 0:18:40.680 report has has not perhaps had the galvanizing impact that maybe, 0:18:40.800 --> 0:18:43.800 you know, the former ECV president might have wanted to see. 0:18:44.040 --> 0:18:47.000 I would imagine it's likely to be a topic for 0:18:47.040 --> 0:18:51.680 discussion on the sidelines. I would imagine that Emmanuel Macran, 0:18:52.000 --> 0:18:56.120 who is always one for articulating his grand vision, might 0:18:56.240 --> 0:18:58.440 be talking about those sorts of issues. But what we've 0:18:58.480 --> 0:19:03.159 seen some after some is that Macran's rhetoric is not 0:19:04.080 --> 0:19:10.119 successful in persuading the rest of the European leadership to 0:19:10.560 --> 0:19:13.600 kind of come along and to take decisions. And we've 0:19:13.600 --> 0:19:16.959 got we've got the very kind of concrete, tangible decision 0:19:16.960 --> 0:19:18.959 on the table of what they're going to do about Ukraine, 0:19:19.040 --> 0:19:22.400 what are they going to do about the frozen Russian assets. 0:19:22.720 --> 0:19:25.280 And that's the real test if the if the Europeans 0:19:25.359 --> 0:19:28.480 want to prove at this moment, when the White House 0:19:28.560 --> 0:19:31.000 is really stepping up its push for a settlement of 0:19:31.040 --> 0:19:34.680 the of the war in Ukraine, the single most important 0:19:34.680 --> 0:19:37.439 thing that Europeans can do is find a way to 0:19:38.080 --> 0:19:43.600 supply for substantial amounts of additional financing to Kiev with 0:19:43.760 --> 0:19:46.520 this mechanism based on the frozen Russian assets. And they've 0:19:46.560 --> 0:19:49.840 been going around around in circles on that for months, 0:19:51.040 --> 0:19:53.520 so now it's really time for them to deliver on 0:19:53.560 --> 0:19:54.040 that one. 0:19:54.320 --> 0:19:57.000 And that again is the issue that President Trump rays 0:19:57.200 --> 0:20:01.320 also just in the past few days, sizing the talk 0:20:01.520 --> 0:20:06.119 the lack of action as he sees it, also again 0:20:06.280 --> 0:20:11.320 using this very strong, very critical language about Europe. It 0:20:11.359 --> 0:20:14.639 really does seem that the Trump White House has the 0:20:14.680 --> 0:20:18.159 EU in its sights and he's talking about European nations, 0:20:18.840 --> 0:20:25.280 decaying this also must have an impact on leaders in 0:20:25.320 --> 0:20:27.720 Europe too. I mean, I just note that the former 0:20:27.760 --> 0:20:32.520 EU diplomaut Joseph Burrell saying European leaders must stop pretending 0:20:32.880 --> 0:20:36.919 that Trump is not our adversary. Are we at that 0:20:37.080 --> 0:20:37.720 point yet? 0:20:38.359 --> 0:20:43.960 The Trump administration, I mean, their rhetoric flips back and 0:20:44.000 --> 0:20:47.840 forth a little bit, but we heard. I was at 0:20:48.000 --> 0:20:50.960 the Munich Security Conference in February where j. D Rans 0:20:51.000 --> 0:20:58.120 delivered that really shocking speech attacking the European Union, attacking 0:20:58.400 --> 0:21:03.440 the kind of the democratic norms on which European societies 0:21:04.600 --> 0:21:12.560 are based. And it was pretty clear then that any support, 0:21:13.119 --> 0:21:17.480 any kind of legacy support that the Europeans were going 0:21:17.520 --> 0:21:20.359 to be getting from the US was going to be 0:21:20.520 --> 0:21:23.879 kind of limited, qualified and certainly not something that you 0:21:23.920 --> 0:21:26.679 could count on. And we've seen that come back with 0:21:26.680 --> 0:21:32.240 a vengeance with the US National Security Strategy, which came 0:21:32.280 --> 0:21:37.159 out last week with that really quite shocking language about 0:21:37.280 --> 0:21:43.960 civilizational Erasia, and you know, following up with those with 0:21:44.240 --> 0:21:47.360 Trump's comments in his interview this week about the weakness 0:21:47.200 --> 0:21:50.600 of European leaders. I have to say I've lived in 0:21:50.640 --> 0:21:54.560 Europe for more than twenty years, and I don't see 0:21:54.720 --> 0:21:59.000 much sign of civilizational Erasia. But I do think he's 0:21:59.080 --> 0:22:00.880 right when he says that the European leaders a week 0:22:00.880 --> 0:22:02.760 and I think that they've been demonstrating that with their 0:22:02.800 --> 0:22:06.520 failure to must have proper support for Ukraine despite all 0:22:06.560 --> 0:22:07.040 of their talk. 0:22:07.920 --> 0:22:12.280 H Yes, I suppose you know to that that raises 0:22:12.359 --> 0:22:17.560 issues around migration anti immigration within Europe. But also, as 0:22:17.600 --> 0:22:22.560 you say, the litmus test is Ukraine in the next 0:22:22.560 --> 0:22:25.680 few days, what do you think is going to change 0:22:25.720 --> 0:22:29.800 who is maybe best to engage with President Trump on 0:22:29.840 --> 0:22:32.479 the European side. The European has been trying to get 0:22:32.520 --> 0:22:37.840 into that negotiation, that process of the US wanting to 0:22:37.880 --> 0:22:41.760 get to a deal with Moscow, but it's about speed 0:22:41.840 --> 0:22:42.800 and who engages. 0:22:43.960 --> 0:22:47.840 Yeah, I think that it's pretty clear by this stage 0:22:47.840 --> 0:22:51.879 in the process that if the Europeans want to have 0:22:51.920 --> 0:22:55.199 a seat at the table, they need to earn that 0:22:55.560 --> 0:23:04.000 by putting down some either some serious support, whether that's money, 0:23:04.400 --> 0:23:08.760 whether that's weapons, whether that's political commitment, whether that's boots 0:23:08.760 --> 0:23:11.760 on the ground in Ukraine. They need to be making 0:23:12.200 --> 0:23:15.920 a real kind of concrete commitment to Ukraine, which will 0:23:15.960 --> 0:23:21.360 demonstrate to the US to Russia, to the Ukrainians that 0:23:21.400 --> 0:23:28.880 the Europeans are serious and serious about taking unilateral measures 0:23:29.080 --> 0:23:34.000 outside of the kind of US umbrella to defend and 0:23:34.119 --> 0:23:38.960 promote their own interests. And so far we haven't seen that. 0:23:39.640 --> 0:23:42.080 I think. I don't know for sure, but I think 0:23:42.119 --> 0:23:44.679 it would have flown a little bit more under the radar. 0:23:44.840 --> 0:23:49.040