1 00:00:02,520 --> 00:00:07,000 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:09,800 --> 00:00:13,119 Speaker 2: This is the Bloomberg Daybacre podcast. Good morning, It's Wednesday, 3 00:00:13,160 --> 00:00:16,640 Speaker 2: the twenty ninth of July. I'm Caroline hepkea in London. 4 00:00:16,560 --> 00:00:19,840 Speaker 3: And I'm Stephen Caroline Brussels. Coming up today, US forces 5 00:00:19,920 --> 00:00:24,240 Speaker 3: intercept a surprise Iranian ballistic missile attack on American basis 6 00:00:24,239 --> 00:00:25,040 Speaker 3: in the Middle East. 7 00:00:25,440 --> 00:00:28,880 Speaker 2: Open Aiyes model goes rogue for a second time with 8 00:00:29,000 --> 00:00:32,120 Speaker 2: growing calls from the industry for safety measures. 9 00:00:32,520 --> 00:00:36,120 Speaker 3: Plus a look at the stage of omahas Spanish Disciples. 10 00:00:36,200 --> 00:00:41,160 Speaker 3: Why Buffett's value investing philosophy is producing market beating returns 11 00:00:41,360 --> 00:00:42,040 Speaker 3: in Madrid. 12 00:00:42,440 --> 00:00:44,479 Speaker 2: Let's start with the roundup of our top stories. 13 00:00:45,280 --> 00:00:47,879 Speaker 3: The US military says it has intercepted what it describes 14 00:00:47,920 --> 00:00:51,920 Speaker 3: as a surprise Iranian ballistic missile attack on American basis 15 00:00:51,920 --> 00:00:55,000 Speaker 3: in the Middle East, arounds at state road. State run 16 00:00:55,240 --> 00:00:59,400 Speaker 3: Arab News says read the Revolutionary Guard launched the missiles 17 00:00:59,400 --> 00:01:02,720 Speaker 3: and response to what it calls recent US aggression, without 18 00:01:02,760 --> 00:01:07,080 Speaker 3: identifying a specific operation. The attack follows US and Saudi 19 00:01:07,120 --> 00:01:10,240 Speaker 3: strikes on a round backed militants in Iraq after Washington 20 00:01:10,319 --> 00:01:14,120 Speaker 3: says Tehran directed thirty drones against American forces over the 21 00:01:14,120 --> 00:01:17,440 Speaker 3: past seventy two hours. Here's Boomberg Jeff Mason. 22 00:01:17,600 --> 00:01:20,440 Speaker 4: President Trump sitting a much more positive tone or at 23 00:01:20,520 --> 00:01:23,760 Speaker 4: least a sort of cautious weight and see tone over 24 00:01:23,800 --> 00:01:28,080 Speaker 4: the last few days, and that would seem to have 25 00:01:28,160 --> 00:01:32,240 Speaker 4: now changed and if passed his prologue. President Trump does 26 00:01:32,280 --> 00:01:36,280 Speaker 4: not react well to attacks from Iran, particularly when he 27 00:01:36,319 --> 00:01:38,720 Speaker 4: believes that there was some kind of an agreement on 28 00:01:38,760 --> 00:01:42,920 Speaker 4: a pause or on a ceasefire, which there wasn't necessarily 29 00:01:42,959 --> 00:01:45,319 Speaker 4: over the last few days, but it did seem like 30 00:01:45,360 --> 00:01:50,200 Speaker 4: both sides were at least tacitly agreeing to hold back. 31 00:01:50,440 --> 00:01:54,160 Speaker 3: As our Whitees correspondent suggests, the rapid escalation ends several 32 00:01:54,280 --> 00:01:56,760 Speaker 3: days of relative calm and raises the risk of a 33 00:01:56,920 --> 00:02:00,360 Speaker 3: return to full scale war in the Middle East. Crude 34 00:02:00,360 --> 00:02:03,000 Speaker 3: oil jumped by more than four percent to trade above 35 00:02:03,320 --> 00:02:05,520 Speaker 3: eighty eight dollars a barrel on the news as At 36 00:02:05,520 --> 00:02:08,280 Speaker 3: rebounded from its biggest three data client since April of 37 00:02:08,280 --> 00:02:09,040 Speaker 3: twenty twenty. 38 00:02:09,480 --> 00:02:14,840 Speaker 2: South Koreas sk Heinix has reported record second quarter operating profits, 39 00:02:15,120 --> 00:02:20,040 Speaker 2: but the results still fell short of investors' lofty expectations. 40 00:02:20,600 --> 00:02:24,239 Speaker 2: Shares of the AI memory chip make a plunge seventeen percent, 41 00:02:24,320 --> 00:02:27,720 Speaker 2: despite operating profit rising more than five hundred and fifty 42 00:02:27,720 --> 00:02:31,320 Speaker 2: percent from a year ago and plans to increase capital 43 00:02:31,360 --> 00:02:35,079 Speaker 2: spending by about fifty percent this year. The sale off 44 00:02:35,160 --> 00:02:38,280 Speaker 2: added two concerns that the AI investment boom maybe running 45 00:02:38,280 --> 00:02:42,040 Speaker 2: ahead of demand. Here's Bloomberg's Markets reporter Antony Stevens. 46 00:02:42,480 --> 00:02:45,400 Speaker 5: This speaks to where expectations are right, like you have 47 00:02:45,440 --> 00:02:47,840 Speaker 5: a record or B it's a five hundred and fifty 48 00:02:47,840 --> 00:02:51,440 Speaker 5: seven percent jump. They're talking about eighty percent plus margins 49 00:02:51,440 --> 00:02:55,240 Speaker 5: eighty three. You have an ADR that went into the 50 00:02:55,280 --> 00:02:58,480 Speaker 5: set into the results with you know, twenty percent plus premium, 51 00:02:58,800 --> 00:03:00,200 Speaker 5: and that speaks to. 52 00:03:00,240 --> 00:03:00,919 Speaker 3: The problem here. 53 00:03:01,000 --> 00:03:05,679 Speaker 5: It's positioning an expectation meeting very high. 54 00:03:05,440 --> 00:03:07,720 Speaker 3: Standards is becoming very difficult. 55 00:03:07,919 --> 00:03:11,320 Speaker 2: Anthony Stephens. As sk heinez led another sell off in 56 00:03:11,440 --> 00:03:15,720 Speaker 2: Asian chip stocks as investors questioned whether record AI spending 57 00:03:15,880 --> 00:03:18,960 Speaker 2: will generate the returns that markets have been pricing in. 58 00:03:19,200 --> 00:03:22,400 Speaker 3: A rogue open AI agent has breached a second testing environment, 59 00:03:22,520 --> 00:03:26,160 Speaker 3: raising fresh questions about the safety of advanced AI systems. 60 00:03:26,639 --> 00:03:30,520 Speaker 3: The AI broke into a customer's isolated testing environment hosted 61 00:03:30,560 --> 00:03:34,240 Speaker 3: by cloud Computing firm Model, which says its own platform 62 00:03:34,320 --> 00:03:37,640 Speaker 3: was not compromised. Last week, Open Ai reveals the same 63 00:03:37,720 --> 00:03:42,280 Speaker 3: experimental AI agent had also hacked developer platform hugging face 64 00:03:42,600 --> 00:03:46,080 Speaker 3: after escaping a test area. The latest incident comes as 65 00:03:46,120 --> 00:03:49,760 Speaker 3: more than one thy one hundred employees across leading AI firms, 66 00:03:49,800 --> 00:03:54,440 Speaker 3: including open Ai, Anthropic, Google, and Meta call for international 67 00:03:54,480 --> 00:03:58,200 Speaker 3: safeguards that could slow AI developments if necessary. 68 00:03:58,760 --> 00:04:02,000 Speaker 2: Now to a very busy earnings dale, let's start with UBS, 69 00:04:02,040 --> 00:04:05,640 Speaker 2: which is announced a new three billion dollar share buyback 70 00:04:05,720 --> 00:04:09,160 Speaker 2: program to run until mid twenty twenty seven. UBS posted 71 00:04:09,200 --> 00:04:11,480 Speaker 2: net income of two point eight billion dollars for the 72 00:04:11,520 --> 00:04:16,440 Speaker 2: second quarter, beating expectations thanks to surge in trading activity 73 00:04:16,520 --> 00:04:21,040 Speaker 2: and more new assets from wealth management clients. In its outlook, 74 00:04:21,120 --> 00:04:25,960 Speaker 2: UBS was cautious about the upcoming quarter given ongoing geopolitical 75 00:04:26,040 --> 00:04:30,039 Speaker 2: uncertainty and volatile energy prices. Now it also released the 76 00:04:30,080 --> 00:04:33,640 Speaker 2: twenty eight page document setting out arguments about its capital base, 77 00:04:33,839 --> 00:04:36,919 Speaker 2: as the Swiss government wants to force the bank to 78 00:04:37,000 --> 00:04:39,640 Speaker 2: raise the amount of common ecty capital that it holds 79 00:04:39,720 --> 00:04:43,080 Speaker 2: domestically against its foreign operations. 80 00:04:43,920 --> 00:04:46,560 Speaker 3: Well, Deutsche banks revenue from fixed income trading jump by 81 00:04:46,680 --> 00:04:50,560 Speaker 3: sixteen percent in the second quarter, outperforming most of its 82 00:04:50,720 --> 00:04:54,240 Speaker 3: US peers. The German lender reporting better than expected pre 83 00:04:54,279 --> 00:04:56,840 Speaker 3: tax profits of almost two point seven billion euros in 84 00:04:56,880 --> 00:04:59,560 Speaker 3: the second quarter. Deutsche Bank also announced and you share 85 00:04:59,600 --> 00:05:02,760 Speaker 3: buyback of five hundred million euros and confirmed its fully 86 00:05:02,800 --> 00:05:06,359 Speaker 3: ir revenue outlook, while saying it's untracked over strong operating 87 00:05:06,400 --> 00:05:07,520 Speaker 3: performance this year. 88 00:05:07,760 --> 00:05:11,600 Speaker 2: Standard Chartered has reported better than expected second quarter earnings 89 00:05:11,640 --> 00:05:15,000 Speaker 2: and announced say fresh billion dollar share buy back. The 90 00:05:15,000 --> 00:05:18,520 Speaker 2: Asia focused lender says that strong growth in its wealth 91 00:05:18,600 --> 00:05:23,120 Speaker 2: management and global banking businesses helped offset concerns over China's 92 00:05:23,120 --> 00:05:27,359 Speaker 2: crackdown on cross border wealth transfers. The bank delivered a 93 00:05:27,400 --> 00:05:30,200 Speaker 2: record first half of the year. The results come just 94 00:05:30,320 --> 00:05:33,560 Speaker 2: months after COO Bill Winters was forced to apologize to 95 00:05:33,720 --> 00:05:37,919 Speaker 2: staff for comments suggesting that AI could replace what he 96 00:05:38,080 --> 00:05:40,680 Speaker 2: described as lower value human. 97 00:05:40,480 --> 00:05:43,279 Speaker 3: Capital in Nor the Nest. Firefighters in Spain and France 98 00:05:43,279 --> 00:05:47,279 Speaker 3: are racing to contain wildfires threatening Madrid and Bordeaux before 99 00:05:47,279 --> 00:05:49,440 Speaker 3: a fourth heat wave over the course of just a 100 00:05:49,440 --> 00:05:53,799 Speaker 3: few weeks sends temperatures back towards forty two degrees later. Today, 101 00:05:54,240 --> 00:05:56,840 Speaker 3: officials say the spread of several major fires are slowed 102 00:05:56,880 --> 00:05:59,960 Speaker 3: but crews are racing to cool burned areas before conditions 103 00:06:00,080 --> 00:06:03,560 Speaker 3: deteriorate again. Saafetti, who lives in Bordeaux and had to 104 00:06:03,640 --> 00:06:06,719 Speaker 3: leave her home at the weekend, it felt apocalyptic. 105 00:06:07,160 --> 00:06:11,960 Speaker 6: The sky went from bright blue to dark in just 106 00:06:12,360 --> 00:06:14,280 Speaker 6: the span of a few hours, I think a couple 107 00:06:14,320 --> 00:06:19,240 Speaker 6: of hours. It was like completely dark at seven eight pm, 108 00:06:19,360 --> 00:06:23,160 Speaker 6: which is not usual here, and then the ashes just 109 00:06:23,520 --> 00:06:27,200 Speaker 6: raining and you would go outside and find your car 110 00:06:27,720 --> 00:06:31,719 Speaker 6: or even the wall parking lot covered with ashes. It 111 00:06:31,920 --> 00:06:34,000 Speaker 6: really felt like another dimension. 112 00:06:34,360 --> 00:06:36,960 Speaker 3: Wildfires have now burned more than four hundred and twenty 113 00:06:37,000 --> 00:06:40,440 Speaker 3: three thousand hectares across Europe this season, destroying crops and 114 00:06:40,440 --> 00:06:44,000 Speaker 3: disrupting transport and just business. As farmers and residents began 115 00:06:44,120 --> 00:06:47,080 Speaker 3: counting the cost, authorities in both countries are rushing to 116 00:06:47,200 --> 00:06:50,240 Speaker 3: roll out financial aid for affected communities. 117 00:06:50,560 --> 00:06:53,560 Speaker 2: The Federal Reserves expected to hold inter a State's steady 118 00:06:53,640 --> 00:06:57,279 Speaker 2: when it concludes its two day meeting today, but market 119 00:06:57,320 --> 00:07:01,920 Speaker 2: participants are eyeing the possibility of a surprise hike as 120 00:07:02,040 --> 00:07:06,080 Speaker 2: patients with high inflation wears thin. Meredith Whitney, the CEO 121 00:07:06,160 --> 00:07:09,760 Speaker 2: of Meredith Whitney Advisory, isn't expecting a move. 122 00:07:10,160 --> 00:07:12,480 Speaker 1: I think they stay in hold and they'll probably still 123 00:07:12,520 --> 00:07:15,040 Speaker 1: have this tough guy language for this hark, a short 124 00:07:15,160 --> 00:07:18,720 Speaker 1: language that gives them wiggle ram. So I think that 125 00:07:19,080 --> 00:07:24,160 Speaker 1: putting these people on these special task force buys Vice 126 00:07:24,240 --> 00:07:25,520 Speaker 1: German Warsh time. 127 00:07:25,400 --> 00:07:29,800 Speaker 2: Meredith Whitney, speaking to Bloomberg Newfaircheck. Evin Walsh has said 128 00:07:29,800 --> 00:07:32,880 Speaker 2: that he has committed to lowering inflation, but hasn't indicated 129 00:07:32,880 --> 00:07:36,320 Speaker 2: whether he supports increasing interest rates to do so. The 130 00:07:36,360 --> 00:07:39,360 Speaker 2: FED will release a post meeting statement at two pm 131 00:07:39,400 --> 00:07:42,640 Speaker 2: today in Washington that seven pm London time, and Walsh 132 00:07:42,720 --> 00:07:45,760 Speaker 2: is scheduled to hold his second post meeting press conference 133 00:07:46,040 --> 00:07:47,080 Speaker 2: thirty minutes later. 134 00:07:47,640 --> 00:07:51,280 Speaker 3: Football's two most powerful governing bodies are engaged in a 135 00:07:51,360 --> 00:07:55,720 Speaker 3: seismic rift. It comes amidst the potential introduction of private 136 00:07:55,840 --> 00:07:59,360 Speaker 3: capital to the game, which has provoked significant reaction. Rix 137 00:07:59,400 --> 00:08:00,120 Speaker 3: Ta added by. 138 00:08:01,120 --> 00:08:05,360 Speaker 7: UEFA, the organizer of European football, reacted furiously earlier this 139 00:08:05,400 --> 00:08:08,960 Speaker 7: week to proposals from international governing body FIFA to seek 140 00:08:09,000 --> 00:08:12,760 Speaker 7: private investment. In a statement, the association said the plans 141 00:08:12,880 --> 00:08:15,800 Speaker 7: cross a line, arguing that the game and its tournaments 142 00:08:16,080 --> 00:08:19,840 Speaker 7: aren't assets to be sold. According to a person familiar 143 00:08:19,880 --> 00:08:22,920 Speaker 7: with the matter, UEFA is now considering a boycott of 144 00:08:22,960 --> 00:08:26,920 Speaker 7: FIFA events and has held internal discussions about how clubs 145 00:08:26,920 --> 00:08:30,840 Speaker 7: and member associations would carry that out. The unrest comes 146 00:08:30,880 --> 00:08:34,080 Speaker 7: at a time when FIFA has encroached on UEFA's turf, 147 00:08:34,400 --> 00:08:37,760 Speaker 7: creating the Club World Cup, an expanded tournament that could 148 00:08:37,880 --> 00:08:42,600 Speaker 7: rival UEFA's own lucrative Champions League. A spokesperson for UEFA 149 00:08:42,720 --> 00:08:45,800 Speaker 7: declined to comment, and FIFA didn't respond to a request 150 00:08:45,840 --> 00:08:46,320 Speaker 7: for comment. 151 00:08:46,840 --> 00:08:49,679 Speaker 8: In London. To here at a Bayo Bloomberg Radio and 152 00:08:49,720 --> 00:08:52,280 Speaker 8: those who are top stories for you today. Looking at 153 00:08:52,320 --> 00:08:55,360 Speaker 8: the markets, very busy for earning, so talked about Deutsche 154 00:08:55,360 --> 00:08:56,960 Speaker 8: Bank UBS and Standard Chartered. 155 00:08:56,960 --> 00:08:57,439 Speaker 3: There'll be some. 156 00:08:57,520 --> 00:09:02,120 Speaker 2: Aftermarket I like Laurel and lots across the morning. Investors 157 00:09:02,160 --> 00:09:05,920 Speaker 2: though rotating out of chip shares, sk Heinex plunging some 158 00:09:06,120 --> 00:09:09,480 Speaker 2: seventeen percent. Its market cap is now down over seven 159 00:09:09,559 --> 00:09:12,880 Speaker 2: hundred billion dollars. The Cosby at the moment in South 160 00:09:12,960 --> 00:09:16,760 Speaker 2: Korea is down seven point six percent, this after the 161 00:09:16,840 --> 00:09:19,199 Speaker 2: eleven percent drop that we saw on Tuesday. So and 162 00:09:19,280 --> 00:09:21,120 Speaker 2: watch to see if the Cosby closes below it's two 163 00:09:21,160 --> 00:09:24,520 Speaker 2: hundred day moving average. There is a thirty percent chance 164 00:09:24,559 --> 00:09:26,920 Speaker 2: of a fed height today, so we will watch that 165 00:09:27,200 --> 00:09:31,439 Speaker 2: as oil prices jumps three point seven percent high for 166 00:09:31,640 --> 00:09:35,600 Speaker 2: brain food currently had eighty seven dollars at nineteen the bout. 167 00:09:35,720 --> 00:09:39,360 Speaker 2: This has stopped futures for europe sink three tenths of 168 00:09:39,640 --> 00:09:41,959 Speaker 2: one percent, even though we close up yesterday for the 169 00:09:42,000 --> 00:09:44,360 Speaker 2: stock six hundred. Those are the markets well. 170 00:09:44,280 --> 00:09:46,480 Speaker 3: At the moment. We will bring you more on that 171 00:09:46,600 --> 00:09:48,840 Speaker 3: escalation in the Middle East, plus how a group of 172 00:09:48,920 --> 00:09:52,040 Speaker 3: Spanish asset managers are making a success of following Warren 173 00:09:52,040 --> 00:09:55,840 Speaker 3: Boffett's approach to investing what first words on another story 174 00:09:55,840 --> 00:09:58,680 Speaker 3: that we've been reading this morning about the quite frankly 175 00:09:58,679 --> 00:10:01,960 Speaker 3: astonishing sums people are willing to spend on exercise gear. 176 00:10:02,200 --> 00:10:04,439 Speaker 3: Lilliy Maher has been writing about the latest high end 177 00:10:04,480 --> 00:10:07,440 Speaker 3: brands that are trying to corner the runners market. So 178 00:10:07,720 --> 00:10:09,840 Speaker 3: one hundred and twenty euros on a T shirt full 179 00:10:09,880 --> 00:10:13,679 Speaker 3: of tiny holes apparently for better aeration, or two hundred 180 00:10:13,679 --> 00:10:17,520 Speaker 3: and ninety euros on shorts figure cuss how much? Two 181 00:10:17,559 --> 00:10:20,560 Speaker 3: hundred and ninety euros just you know, and yeah, I 182 00:10:20,559 --> 00:10:22,480 Speaker 3: mean they don't sing or dance or anything like that. 183 00:10:22,520 --> 00:10:24,719 Speaker 3: It's just you know, standard pair of shorts by the 184 00:10:24,760 --> 00:10:27,679 Speaker 3: looks of things. Apparently, sales according to figures in the 185 00:10:27,800 --> 00:10:30,240 Speaker 3: US of running a parallel of nearly ten percent in 186 00:10:30,280 --> 00:10:33,560 Speaker 3: the year to May, driven almost entirely by price increases, 187 00:10:33,720 --> 00:10:35,680 Speaker 3: where people are willing to spend this money, not just 188 00:10:35,760 --> 00:10:40,040 Speaker 3: because they want the most performative or the most performing 189 00:10:40,679 --> 00:10:42,679 Speaker 3: kind of gear. This is also about fashion as well, 190 00:10:42,679 --> 00:10:44,000 Speaker 3: who you might meet on the way to the run, 191 00:10:44,040 --> 00:10:46,440 Speaker 3: on the way home as well. Lily speaks to several 192 00:10:46,520 --> 00:10:49,360 Speaker 3: runners about this, who essentially admit as much that looking 193 00:10:49,360 --> 00:10:51,800 Speaker 3: the part is important and there are plenty of brands 194 00:10:51,920 --> 00:10:55,560 Speaker 3: sprouting up to try and provide that as well. Course, 195 00:10:55,600 --> 00:10:57,520 Speaker 3: there is the performance element part of this as well. 196 00:10:57,800 --> 00:11:00,640 Speaker 3: You know, remember the two marathon runners that the two 197 00:11:00,679 --> 00:11:03,440 Speaker 3: hour record and they have their ultra light shoes that 198 00:11:03,440 --> 00:11:06,280 Speaker 3: we're talking about as well. Put goil Fro Bloomberg Intelligence 199 00:11:06,280 --> 00:11:09,000 Speaker 3: says that as the running market has been getting more premium, 200 00:11:09,000 --> 00:11:13,280 Speaker 3: this is being led by technical and performance advancements. But 201 00:11:13,320 --> 00:11:14,920 Speaker 3: I can't help but feel I mean, running used to 202 00:11:14,960 --> 00:11:16,079 Speaker 3: be the cheap thing to do. You know, if you 203 00:11:16,120 --> 00:11:18,160 Speaker 3: couldn't afford a gym membership, you could just go for 204 00:11:18,200 --> 00:11:21,320 Speaker 3: a run instead. Are you being priced out? Now of 205 00:11:21,400 --> 00:11:22,520 Speaker 3: actually going for a run. 206 00:11:22,840 --> 00:11:25,760 Speaker 2: Yeah. Look, I'm all the gear and no idea, So 207 00:11:25,920 --> 00:11:29,400 Speaker 2: you know, I don't think I can I can claim 208 00:11:29,440 --> 00:11:31,439 Speaker 2: to be proficient at running, but yes I do. I 209 00:11:31,440 --> 00:11:34,520 Speaker 2: wouldn't mind the kind of outfits. Yeah, I think this 210 00:11:34,559 --> 00:11:36,559 Speaker 2: is a great story, but it's also just an interesting 211 00:11:36,600 --> 00:11:39,480 Speaker 2: development in the market, and also that it's men and 212 00:11:39,559 --> 00:11:41,800 Speaker 2: women now who are kind of into the ath leisure 213 00:11:42,200 --> 00:11:44,840 Speaker 2: price tag. There you go, We've all got to invest 214 00:11:44,960 --> 00:11:45,600 Speaker 2: something in this. 215 00:11:45,880 --> 00:11:46,000 Speaker 1: Well. 216 00:11:46,040 --> 00:11:47,440 Speaker 3: Ideed to put a link to that story in our 217 00:11:47,440 --> 00:11:50,880 Speaker 3: podcast show notes. Well, let's turned back to our top 218 00:11:50,880 --> 00:11:54,319 Speaker 3: story this morning and more details on that US. The 219 00:11:54,400 --> 00:11:57,000 Speaker 3: US saying that intercepted that Iranian attack on Basis in 220 00:11:57,040 --> 00:11:59,480 Speaker 3: the Middle East are head of midle East North Africa coverage. 221 00:11:59,559 --> 00:12:02,880 Speaker 3: You're a living and Whilas joins us now for more, Stuart, 222 00:12:03,080 --> 00:12:05,320 Speaker 3: what do we know about this attack and what might 223 00:12:05,320 --> 00:12:05,959 Speaker 3: have provoked it? 224 00:12:06,760 --> 00:12:09,120 Speaker 9: Yeah, good morning. I mean the short answer is we 225 00:12:09,160 --> 00:12:11,880 Speaker 9: don't quite know the full extent of it. So we've 226 00:12:11,880 --> 00:12:15,200 Speaker 9: had confirmation from Jordan this morning that had intercepted missiles 227 00:12:15,280 --> 00:12:18,520 Speaker 9: coming in. We don't know if that is all of 228 00:12:18,559 --> 00:12:20,960 Speaker 9: what Saint con was talking about or there were others 229 00:12:22,280 --> 00:12:25,480 Speaker 9: but I think what's interesting here is that it seems 230 00:12:25,520 --> 00:12:28,240 Speaker 9: to be Iron going first, and we also know that 231 00:12:28,280 --> 00:12:30,480 Speaker 9: it's gone after, or it says it's gone after more 232 00:12:30,520 --> 00:12:33,920 Speaker 9: ships around Hall moves or at least tried to intercept 233 00:12:33,920 --> 00:12:36,960 Speaker 9: them or turn them back. But perhaps more importantly in 234 00:12:36,960 --> 00:12:41,280 Speaker 9: some respects in the sense that it's historically rare, is 235 00:12:41,320 --> 00:12:45,480 Speaker 9: that you had this joint US Saudi operation on what 236 00:12:45,640 --> 00:12:50,440 Speaker 9: looks like these Iran back militias and eastern Iraq, and 237 00:12:50,480 --> 00:12:52,760 Speaker 9: that is very unusual, particularly from the point of view 238 00:12:52,800 --> 00:12:56,520 Speaker 9: of this sort of officially acknowledged Saudi participation. And we 239 00:12:56,520 --> 00:12:58,880 Speaker 9: were dusting off the history books this morning and we're 240 00:12:58,920 --> 00:13:01,160 Speaker 9: not quite sure, so, you know, take this with a 241 00:13:01,160 --> 00:13:03,480 Speaker 9: pinch salt, but it looks like that may have been 242 00:13:03,520 --> 00:13:07,440 Speaker 9: the first time in several decades. Certainly, it's a very 243 00:13:07,600 --> 00:13:09,840 Speaker 9: rare event, and I think what that signals is that 244 00:13:09,880 --> 00:13:13,040 Speaker 9: this is sort of a different kind of escalation that 245 00:13:13,120 --> 00:13:15,120 Speaker 9: we'll watch and see what happens in the next few days. 246 00:13:15,160 --> 00:13:16,959 Speaker 9: But it is certainly. 247 00:13:16,600 --> 00:13:21,480 Speaker 2: Concerning, Okay, concerning, So then do you think that further 248 00:13:21,600 --> 00:13:25,160 Speaker 2: escalation is inevitable? I mean, that's a strong word, but 249 00:13:25,400 --> 00:13:26,600 Speaker 2: how are we thinking about it? 250 00:13:26,920 --> 00:13:29,079 Speaker 9: Yeah, I mean, it's certainly going to be I think, 251 00:13:29,160 --> 00:13:32,080 Speaker 9: very difficult for the US to decide not to respond again. 252 00:13:32,160 --> 00:13:35,240 Speaker 9: That does not mean that they will, but given that, 253 00:13:35,480 --> 00:13:39,320 Speaker 9: you know, Iran seems to be going back to this 254 00:13:39,440 --> 00:13:43,720 Speaker 9: sort of this endless crossfire, be interesting to see how 255 00:13:43,760 --> 00:13:47,800 Speaker 9: the US responds, you know, how measured it will be. Clearly, 256 00:13:47,840 --> 00:13:50,000 Speaker 9: a lot of the rhetoric coming out of the White 257 00:13:50,000 --> 00:13:52,839 Speaker 9: House is that, at least for the last couple of days, 258 00:13:52,880 --> 00:13:56,080 Speaker 9: is that they would much prefer the diplomatic track. But 259 00:13:56,200 --> 00:13:59,040 Speaker 9: again they you know, with every time they say that, 260 00:13:59,240 --> 00:14:01,880 Speaker 9: they sort of remind in Iran that, you know, they 261 00:14:01,880 --> 00:14:05,760 Speaker 9: are willing to escalate again if need be so. Again, 262 00:14:05,840 --> 00:14:09,160 Speaker 9: It'll be interesting to see how this develops and whether 263 00:14:09,400 --> 00:14:12,880 Speaker 9: they are indeed making any headway whatsoever on the diplomatic track. 264 00:14:13,200 --> 00:14:15,640 Speaker 3: But ever learn meanwhile that Iran and Oman are working 265 00:14:15,720 --> 00:14:17,959 Speaker 3: on a plan to restart shipping through the Strait of 266 00:14:18,040 --> 00:14:19,720 Speaker 3: for MOUs What more can you tell us? 267 00:14:20,080 --> 00:14:23,640 Speaker 9: So we know that the imanis spent the weekend in 268 00:14:23,680 --> 00:14:27,720 Speaker 9: Tehran sort of making their proposals. The Iranian response was 269 00:14:27,800 --> 00:14:32,440 Speaker 9: that it wasn't particularly satisfied with those what seems to 270 00:14:32,520 --> 00:14:35,040 Speaker 9: have been proposed, and again uncautious because we've not had 271 00:14:35,080 --> 00:14:37,800 Speaker 9: any official statements on this, but what seems to be 272 00:14:37,880 --> 00:14:41,040 Speaker 9: proposed is some sort of joint control overhaul moves where 273 00:14:41,080 --> 00:14:44,520 Speaker 9: Oman perhaps controls one way through maybe the sort of 274 00:14:44,560 --> 00:14:48,080 Speaker 9: the southern route, Iran controls the northern route, something along 275 00:14:48,120 --> 00:14:51,080 Speaker 9: those lines. And you know, again in terms of the 276 00:14:51,080 --> 00:14:53,760 Speaker 9: way the fees would be structured, would be something in 277 00:14:53,760 --> 00:14:55,600 Speaker 9: line with what you see in the Strait of Malaca 278 00:14:55,840 --> 00:14:58,600 Speaker 9: or the Dardan Nils and bus for us around Turkey, 279 00:14:59,200 --> 00:15:02,200 Speaker 9: where they're not trying to extract vast amounts of money. 280 00:15:02,640 --> 00:15:05,160 Speaker 9: You know, they're sort of relatively low level fees for 281 00:15:05,520 --> 00:15:10,640 Speaker 9: things like environmental management, pilotage, that kind of thing. But 282 00:15:10,680 --> 00:15:13,320 Speaker 9: at least on the face of Iran is not particularly 283 00:15:13,400 --> 00:15:15,560 Speaker 9: happy about those proposals, so I think they've sort of 284 00:15:16,520 --> 00:15:19,000 Speaker 9: asked their manage to come back with something different. That 285 00:15:19,120 --> 00:15:22,960 Speaker 9: will be the key first step though in a wider 286 00:15:22,960 --> 00:15:25,760 Speaker 9: diplomatic resolution, you know, they I think all sides want 287 00:15:25,800 --> 00:15:28,560 Speaker 9: to get the oil flowing again. Until you fix horn Moss, 288 00:15:28,640 --> 00:15:30,280 Speaker 9: very difficult to talk about anything else. 289 00:15:31,000 --> 00:15:33,440 Speaker 2: Yeah, Okay, Stuart, thank you so much for being with 290 00:15:33,560 --> 00:15:36,080 Speaker 2: us and giving us the latest then on the Middle East, 291 00:15:36,080 --> 00:15:39,160 Speaker 2: that is Stuet Livingston Wallace, our head of Middle East 292 00:15:39,160 --> 00:15:43,920 Speaker 2: and North Africa coverage. Thanks stay with us. More from 293 00:15:43,920 --> 00:15:46,040 Speaker 2: Bloomberg daybakeup coming up after this. 294 00:15:47,360 --> 00:15:50,240 Speaker 3: The value investors are dying breeds these days, but a 295 00:15:50,280 --> 00:15:54,040 Speaker 3: small group is posting stellar returns by embracing the Warren 296 00:15:54,080 --> 00:15:57,400 Speaker 3: Boffett Wade, led by the Spanish fund manager Francisco Garcia 297 00:15:57,480 --> 00:16:00,640 Speaker 3: Parames and our markets editor at Margarita kirk And joins 298 00:16:00,720 --> 00:16:03,080 Speaker 3: us now for more on the story. Margret, good morning, 299 00:16:03,080 --> 00:16:05,680 Speaker 3: tell us a bit more about Parames and his approach 300 00:16:05,720 --> 00:16:06,600 Speaker 3: to managing money. 301 00:16:07,000 --> 00:16:11,360 Speaker 10: So Paramas has legendary status in value circles in Spain, 302 00:16:11,840 --> 00:16:14,280 Speaker 10: and it all started for him all these years ago 303 00:16:14,440 --> 00:16:18,120 Speaker 10: from discovering Peter Lynch and later Warren Buffett. So he 304 00:16:18,160 --> 00:16:22,240 Speaker 10: found a solid framework to buy assets below their intrinsic 305 00:16:22,320 --> 00:16:26,640 Speaker 10: value and being patient. So he is kind of like 306 00:16:26,760 --> 00:16:31,000 Speaker 10: unique in that, but also unlike Buffet, he focused on 307 00:16:31,240 --> 00:16:35,080 Speaker 10: medium sized European companies and that's how it all started 308 00:16:35,080 --> 00:16:38,040 Speaker 10: for him. He did more than a two decades run 309 00:16:38,040 --> 00:16:42,160 Speaker 10: at Bastinvore, then launched his own firm called Bus and 310 00:16:42,960 --> 00:16:46,480 Speaker 10: his Cobo was International Fund achieved an average annual return 311 00:16:46,520 --> 00:16:49,360 Speaker 10: of twenty percent in the past five years, so it's 312 00:16:49,360 --> 00:16:50,120 Speaker 10: pretty good going. 313 00:16:50,720 --> 00:16:54,440 Speaker 2: That's interesting then that he's managed, you know, that kind 314 00:16:54,480 --> 00:16:56,960 Speaker 2: of of success. Tell us a bit more about what 315 00:16:57,080 --> 00:17:00,920 Speaker 2: he's managed to do, you know, following this part, as 316 00:17:00,960 --> 00:17:04,440 Speaker 2: you say, popularized by one buffet, by Benjamin Graham, by 317 00:17:04,720 --> 00:17:08,600 Speaker 2: you know, Peter Lynch and others, what are his followers 318 00:17:08,640 --> 00:17:11,720 Speaker 2: doing and how much money is being made. 319 00:17:12,040 --> 00:17:16,280 Speaker 10: He influenced quite a range of different investors, some names 320 00:17:16,320 --> 00:17:20,200 Speaker 10: that people know in Europe as Ivan Martin, Andrewsalinde, Alvaro 321 00:17:20,240 --> 00:17:24,080 Speaker 10: Guzman de Lazaro, Fernando Burnout, the list goes on. The 322 00:17:24,160 --> 00:17:27,840 Speaker 10: main thing was he proved the concept that value investing 323 00:17:28,200 --> 00:17:31,920 Speaker 10: can work and can deliver good returns. And that's quite 324 00:17:31,920 --> 00:17:34,520 Speaker 10: a fit in a country like Spain, for instance, where 325 00:17:34,520 --> 00:17:37,600 Speaker 10: people do like their bank accounts, they do like their 326 00:17:37,680 --> 00:17:43,520 Speaker 10: real estate investing. So to turn that around was quite 327 00:17:43,560 --> 00:17:46,520 Speaker 10: quite difficult actually, and the way he went about it 328 00:17:46,920 --> 00:17:51,480 Speaker 10: he started these annual conferences. But it's like a soccer 329 00:17:51,600 --> 00:17:54,720 Speaker 10: match the way, more than five hundred people gathering and 330 00:17:54,760 --> 00:17:59,280 Speaker 10: everybody's discussing how collect value investing works and what he's doing. 331 00:17:59,720 --> 00:18:04,120 Speaker 10: So it's kind of a lot about educating public in 332 00:18:04,160 --> 00:18:08,320 Speaker 10: Spain about how his approach can actually work and the 333 00:18:08,400 --> 00:18:11,840 Speaker 10: fact that you can buy doc cheap and then wait 334 00:18:11,880 --> 00:18:15,359 Speaker 10: for a long time through sickens In and get good 335 00:18:15,400 --> 00:18:16,480 Speaker 10: returns at the end of it. 336 00:18:16,880 --> 00:18:21,200 Speaker 3: Could this success lead to perhaps a revival of value investing, 337 00:18:21,200 --> 00:18:23,080 Speaker 3: which has somewhat fallen out a favor. 338 00:18:23,600 --> 00:18:26,080 Speaker 10: It's a very good question. I think it will probably 339 00:18:26,119 --> 00:18:29,240 Speaker 10: take more than a group about performing managers to turn 340 00:18:29,320 --> 00:18:32,800 Speaker 10: this around. Value funds still we see about seven point 341 00:18:32,840 --> 00:18:36,399 Speaker 10: five percent of equity assets according to morning Star, so 342 00:18:36,560 --> 00:18:39,840 Speaker 10: it is a niche. But now that some people are 343 00:18:39,880 --> 00:18:43,600 Speaker 10: worried about how expensive textures have become. For example, we've 344 00:18:43,680 --> 00:18:48,840 Speaker 10: been talking about skiheinigs dropping from its highs. So obviously 345 00:18:49,359 --> 00:18:53,320 Speaker 10: managers like Paramas and the others in Spain, they offer 346 00:18:53,600 --> 00:18:58,560 Speaker 10: an attractive and cheap alternative. So one attack is losing altitude. 347 00:18:59,119 --> 00:19:01,600 Speaker 10: Then you look for things like energy, you look for 348 00:19:01,640 --> 00:19:04,199 Speaker 10: things like mine, and these guys they've got it all 349 00:19:04,240 --> 00:19:07,560 Speaker 10: on their portfolios. But more importantly, they have the track 350 00:19:07,640 --> 00:19:11,720 Speaker 10: record to show that actually this approach works and we 351 00:19:11,800 --> 00:19:12,800 Speaker 10: can make you money with it. 352 00:19:13,960 --> 00:19:16,320 Speaker 3: Thanks for listening to Bloomberg Daybreak Europe. 353 00:19:16,480 --> 00:19:19,040 Speaker 2: If you're enjoying the podcast, give us a follow, leave 354 00:19:19,080 --> 00:19:21,280 Speaker 2: a rating, all review, and maybe send it to that 355 00:19:21,440 --> 00:19:24,239 Speaker 2: one friend or colleague who's always trying to keep up 356 00:19:24,280 --> 00:19:24,879 Speaker 2: with the news. 357 00:19:25,280 --> 00:19:27,480 Speaker 3: And if one podcast today isn't enough for you, you 358 00:19:27,480 --> 00:19:30,280 Speaker 3: can also listen to us live every weekday from six 359 00:19:30,320 --> 00:19:33,399 Speaker 3: am in London on DAB Radio, on tune in and 360 00:19:33,560 --> 00:19:35,160 Speaker 3: on the Bloomberg Business App. 361 00:19:35,440 --> 00:19:37,880 Speaker 2: Oh if you've got a smart speaker neary, just say 362 00:19:38,040 --> 00:19:40,000 Speaker 2: play Bloomberg Radio.