WEBVTT - (Radio) 0:00:03.760 --> 0:00:06.480 This is Bloomberg Daybreak Weekend, our global look at the 0:00:06.519 --> 0:00:08.960 top stories in the coming week from our Daybreak anchors 0:00:09.039 --> 0:00:11.799 all around the world. That shows the hand of the program. 0:00:11.840 --> 0:00:14.240 We're gonna be getting more insight into the move. The 0:00:14.320 --> 0:00:16.960 FED is in. I'm John Tucker in New York. I'm 0:00:17.040 --> 0:00:19.640 dou Krisner will have great decisions in the coming week 0:00:19.680 --> 0:00:22.920 from the Bank of Korea and the Reserve Bank of Australia. 0:00:23.200 --> 0:00:25.520 I'm calling head get him in London where we're looking 0:00:25.600 --> 0:00:29.920 at the controversial cutter footballing World Cup. I maybe Morris 0:00:30.040 --> 0:00:33.400 in Washington. After the midterms. What comes next for the 0:00:33.479 --> 0:00:38.480 GOP and Donald Trump. That's all straight ahead on Bloomberg 0:00:38.560 --> 0:00:43.320 Daybreak Weekend on Bloomberg eleven three on New York, Bloomberg one, 0:00:43.440 --> 0:00:47.120 Washington d C, Bloomberg one oh six one, Boston, Bloomberg 0:00:47.240 --> 0:00:50.920 nine sixties, San Francisco d A B Digital Radio, London, 0:00:51.120 --> 0:00:54.040 Sirius XM one nine ten, and around the world on 0:00:54.120 --> 0:01:01.080 Bloomberg Radio dot Com and via the Bloomberg Business App. Hi, 0:01:01.120 --> 0:01:03.840 everybody on John Tucker. Let's start today's program with the 0:01:03.840 --> 0:01:06.600 FED and becoming fed minutes headed our way, joining me 0:01:06.640 --> 0:01:10.360 to talk about it. Bloomberg Global Economics and Policy editor 0:01:10.880 --> 0:01:13.960 Michael McKee. You know, we had what Bloomberg is calling 0:01:14.000 --> 0:01:18.360 a deafening chorus of Fed hawks speaking this week, including St. 0:01:18.400 --> 0:01:22.560 Louis FED President Jim Bullard. Here's how he put it. 0:01:23.080 --> 0:01:27.680 Even under these generous assumptions, the policy rates still isn't 0:01:27.720 --> 0:01:31.039 at a zone that might be considered sufficiently restrictive. To 0:01:31.120 --> 0:01:34.880 get to this sufficiently restrictive level of policy will need 0:01:34.920 --> 0:01:38.759 to increase the policy rate further. Bullard presenting those charts 0:01:38.840 --> 0:01:42.920 at an event in Kentucky Hosted by the Greater Louisville, Inc. 0:01:43.520 --> 0:01:46.600 He showed a restrictive zone of somewhere between five and 0:01:46.760 --> 0:01:52.160 seven percent. So, um, how draconian is between five and 0:01:52.200 --> 0:01:57.400 seven that's encompasses the range from about as expected to 0:01:57.600 --> 0:02:02.640 draconian we have. Uh. Bullards go on to clarify that 0:02:02.680 --> 0:02:05.640 he's thinking five to five and a quarter percent for 0:02:05.680 --> 0:02:09.480 a terminal rate that's not outside the right can back 0:02:09.560 --> 0:02:12.280 up for people who don't follow this minute by minute 0:02:12.320 --> 0:02:14.880 like you, to the terminal rate is where the Fed's 0:02:14.919 --> 0:02:17.560 gonna stop and stop. What the rate is going to 0:02:17.600 --> 0:02:21.079 be when the Fed stops raising rates? And he thinks 0:02:21.120 --> 0:02:23.680 five to five at a quarter percent, where is it 0:02:23.760 --> 0:02:26.560 right now? Right now it's at four percent is the 0:02:26.600 --> 0:02:28.960 top of the range. Uh, it trades a little bit 0:02:28.960 --> 0:02:30.720 below that. So if you get to five and a 0:02:30.760 --> 0:02:34.720 quarter percent, you'd probably be trading around five to five 0:02:35.360 --> 0:02:39.240 point one percent something like that. So, uh, that's not 0:02:39.240 --> 0:02:41.959 outside the range of what other FED officials have been saying. 0:02:42.280 --> 0:02:44.200 There's sort of a feeling that they got to get 0:02:44.240 --> 0:02:47.440 to four and three quarters too, in the neighborhood of 0:02:47.480 --> 0:02:50.720 five maybe something a little bit over that seven percent. 0:02:51.200 --> 0:02:55.359 That would indicate that inflation is much stickier than they anticipated, 0:02:55.440 --> 0:02:59.400 and the economy is uh in need of much more restraint, 0:03:00.000 --> 0:03:03.720 and they had anticipated. What he did was used the 0:03:03.760 --> 0:03:05.840 tailor rule, which you've heard of, which is a way 0:03:05.880 --> 0:03:10.359 of plugging in economic indicators and it spits out what 0:03:10.880 --> 0:03:15.480 the optimal policy would be. Uh. It's really designed to 0:03:15.520 --> 0:03:18.720 look backward at what had happened, but some people use 0:03:18.800 --> 0:03:20.520 it looking forward. And he wanted to make the case 0:03:21.040 --> 0:03:23.480 that the FED is not done. No matter what happens, 0:03:23.520 --> 0:03:26.400 the FED is not done right now racing interest rate, 0:03:26.440 --> 0:03:29.200 you also got to consider the source. Jim Bullard is 0:03:29.240 --> 0:03:31.760 a bit of a hawk, right Well, he's been a hawk. 0:03:32.280 --> 0:03:35.200 He's been all over the map in his career, but 0:03:35.600 --> 0:03:38.360 lately been a hawk. The reason people pay attention to 0:03:38.440 --> 0:03:41.720 him is he's usually the first one to raise an 0:03:41.840 --> 0:03:44.920 idea that may then get into the mainstream. He was 0:03:44.960 --> 0:03:46.920 the first one to suggest that the Fed might do 0:03:46.960 --> 0:03:49.560 a seventy five basis point move this year, and now 0:03:49.600 --> 0:03:52.000 they've done four in a row. So when he says 0:03:52.040 --> 0:03:55.000 five to seven percent, obviously Wall Street sets up and 0:03:55.160 --> 0:03:58.200 takes note. When we get clues that maybe inflation, the 0:03:58.280 --> 0:04:01.280 rate of inflation has peaked, that the rate of inflation 0:04:01.400 --> 0:04:04.600 might be slowing, it's off to the races for the 0:04:04.640 --> 0:04:08.400 equity markets that we've seen with the latest CPI report. 0:04:09.040 --> 0:04:14.000 Um is the that's the c p I, that's inflation, 0:04:15.400 --> 0:04:17.440 the prices that we pay at the market. But in 0:04:17.520 --> 0:04:21.080 the employment report that still doesn't seem to have been 0:04:21.200 --> 0:04:25.640 impacted by any Fed policy. Am I right in saying that? 0:04:25.800 --> 0:04:30.880 And do they have to torpedo employment? That's a big 0:04:31.000 --> 0:04:34.680 argument out there. Historically that's what happens. The FED raisers 0:04:34.720 --> 0:04:38.760 interest rates, and so companies in particular, but people as well, 0:04:38.760 --> 0:04:42.680 with their auto loans and home loans stop borrowing money, 0:04:43.080 --> 0:04:46.880 and that means less economic activity, and then companies look 0:04:46.920 --> 0:04:49.120 at who they have on staff and they don't need 0:04:49.160 --> 0:04:50.600 as many people if they're not going to be doing 0:04:50.600 --> 0:04:53.160 as much work, and so you see the unemployment rate 0:04:53.200 --> 0:04:55.360 go up. Now in this case, uh, this is a 0:04:55.400 --> 0:04:58.960 very unusual situation because everybody lost their jobs at once 0:04:59.400 --> 0:05:02.080 and a lot of people didn't come back when the 0:05:02.160 --> 0:05:07.000 job's reopened. So you're during the pandemic. So you're seeing 0:05:07.160 --> 0:05:12.360 a slowdown now in the pace of job growth each month. 0:05:12.440 --> 0:05:15.320 But is that because companies don't need to hire as 0:05:15.360 --> 0:05:18.240 many people because they finally got people back, or is 0:05:18.279 --> 0:05:21.880 it because they see bad business conditions ahead. We don't know. 0:05:22.200 --> 0:05:25.279 We're looking at the unemployment rate and it went up 0:05:25.320 --> 0:05:27.440 from three and a half to three point seven percent, 0:05:27.520 --> 0:05:29.720 but it did that in August as well, and went 0:05:29.800 --> 0:05:32.760 back to three point five in September. So the Fed 0:05:33.080 --> 0:05:36.160 FED officials are saying, you know, as far as employment 0:05:36.200 --> 0:05:39.600 is concerned, we don't know yet what the actual trend is. 0:05:39.800 --> 0:05:42.000 They think unemployment has to go up to around four 0:05:42.040 --> 0:05:46.200 and a half percent or so, but it's not. I've 0:05:46.240 --> 0:05:49.680 been moving very quickly in that direction. So they're gonna 0:05:49.720 --> 0:05:52.240 want to see more and I'm sure that was a 0:05:52.279 --> 0:05:54.520 discussion at the meeting that will show up in the minutes. 0:05:54.800 --> 0:05:58.320 Can I utter the most dangerous words in investing? This 0:05:58.480 --> 0:06:02.640 time things are different? Uh, this time things are different. 0:06:02.640 --> 0:06:05.160 I mean it was the first thing they taught you 0:06:05.200 --> 0:06:08.880 in economics graduate school is this time things are never different, 0:06:08.920 --> 0:06:11.440 except that they are because we haven't had a pandemic, 0:06:12.160 --> 0:06:15.040 global pandemic like this since nineteen eighteen, and we didn't 0:06:15.080 --> 0:06:18.479 have good economic data at that point. So yeah, this 0:06:18.600 --> 0:06:21.119 time things are different. In the FED and Wall Street 0:06:21.120 --> 0:06:23.880 and everybody's trying to model what's going to happen. They're 0:06:23.880 --> 0:06:26.200 doing their best, but there's not a lot of historical 0:06:26.320 --> 0:06:28.800 data to put into those models, so they can't be sure. 0:06:29.200 --> 0:06:32.320 All right, Mike, as always, we appreciate it. Michael McKee, 0:06:32.720 --> 0:06:35.600 and just a hand on Bloomberg Daybreak weekend. Big decisions 0:06:35.680 --> 0:06:39.680 looming for the Bank of Korea and New Zealand's Central 0:06:39.680 --> 0:06:54.320 Bank as well. I'm John Summer. This is Bloomberg. This 0:06:54.600 --> 0:06:57.159 is Bloomberg Daybreak Weekend, our global look ahead at the 0:06:57.240 --> 0:06:59.880 top stories for investors in the coming week. I'm John 0:07:00.000 --> 0:07:02.400 Sucker in New York. Of Later in the program, the 0:07:02.440 --> 0:07:06.000 world copy and Cutter is upon US and the event 0:07:06.160 --> 0:07:09.520 and politics surrounded getting a lot of attention. But first 0:07:09.520 --> 0:07:13.800 central banker is in Asia steering down inflation and for more, 0:07:13.880 --> 0:07:16.720 let's go to Bloomberg Daybreak Asia host Doug Krisner John. 0:07:16.760 --> 0:07:19.800 As you know, inflation has been at historic levels in 0:07:19.840 --> 0:07:23.119 many countries across the globe, and the respective central banks 0:07:23.120 --> 0:07:26.160 have been fighting to bring those prices down. Well. In 0:07:26.200 --> 0:07:29.560 the week ahead, we have monetary policy decisions from the 0:07:29.600 --> 0:07:32.560 Bank of Korea and the Reserve Bank of New Zealand. 0:07:32.840 --> 0:07:35.000 Now it's going to be particularly delicate for the b 0:07:35.160 --> 0:07:38.200 OK since South Korea has been dealing with a credit 0:07:38.240 --> 0:07:40.840 crunch in the last week. On day Break Asia, we 0:07:40.920 --> 0:07:44.840 ask Rajeev de Mello, global macro portfolio manager at Gamma 0:07:44.920 --> 0:07:48.280 Asset Management, for his take. The Bank of Create is 0:07:48.440 --> 0:07:53.120 somewhat more dubbish than central banks in in Latin America 0:07:53.560 --> 0:07:56.720 or the US for many domestic reasons as well. But 0:07:56.800 --> 0:08:00.520 inflation has not only gone up for domestic reasons, but 0:08:00.600 --> 0:08:03.640 the one has been weak until most recently, and that's 0:08:03.680 --> 0:08:06.559 also not been very good for the Bank of Korea. 0:08:06.880 --> 0:08:10.680 Will high rates we expect to twenty five basis points hike. 0:08:11.160 --> 0:08:15.120 That's Rajiv Demelo of Gamma Asset Management. So let's take 0:08:15.120 --> 0:08:18.280 a preview of the b OKA meeting with Bloomberg's Global 0:08:18.320 --> 0:08:22.040 Economics and Policy editor Kathleen Hayes. So, this is the 0:08:22.160 --> 0:08:25.200 last rate decision that the b OK will have for 0:08:26.840 --> 0:08:29.000 a rate hike. I think, Kathleen, seems to be a 0:08:29.040 --> 0:08:33.320 foregone conclusion. If there's a debate right now in markets 0:08:33.400 --> 0:08:36.840 or fifty basis points, is that fair? It's completely fair 0:08:37.040 --> 0:08:39.360 because they did a fifty basis point rate hike when 0:08:39.360 --> 0:08:42.040 they had signaled twenty five basis points at the last meeting, 0:08:42.120 --> 0:08:44.120 and they got a bit of pushback after that. That's 0:08:44.120 --> 0:08:46.960 one of the reasons why I think some economists has 0:08:47.000 --> 0:08:50.400 been saying, uh that even with inflation still high, but 0:08:50.440 --> 0:08:53.240 with a property market under pressure and a credit market 0:08:53.280 --> 0:08:56.960 that's has been gone through some major gyrations in the 0:08:57.040 --> 0:09:00.560 last month or so, it would be prudent to go 0:09:00.640 --> 0:09:02.880 back to the twenty five basis point hike for now, 0:09:02.960 --> 0:09:04.800 that seems to be the consensus. It will be quite 0:09:04.800 --> 0:09:08.000 a surprise if they do the fifty and the wand 0:09:08.200 --> 0:09:11.120 wanting to keep its stable might be a reason for 0:09:11.160 --> 0:09:13.680 them to do that, because going into the previous meeting 0:09:13.720 --> 0:09:15.480 that's one of the reasons why they're expected to step 0:09:15.559 --> 0:09:17.440 up a little bit more to put a floor into 0:09:17.440 --> 0:09:19.680 the currency. There seems to be this view in markets 0:09:19.720 --> 0:09:23.240 that the risk of corporate default is greater now and 0:09:23.360 --> 0:09:28.360 in particular concentrated in some segments of the business community 0:09:28.400 --> 0:09:31.920 within South Korea. Leverage we know is a problem in 0:09:32.160 --> 0:09:34.880 household activity, but I didn't realize that it was so 0:09:34.960 --> 0:09:38.360 critical on the corporate side. First step one, so setting 0:09:38.400 --> 0:09:42.080 the whole thing up, was the global bond route. That's 0:09:42.120 --> 0:09:45.440 what pressured bond markets around the world. But then the 0:09:45.480 --> 0:09:51.560 funniest thing happened on September, UH, the developer of the 0:09:51.640 --> 0:09:56.240 Lego Land Korea theme park in Gangwong Province, missed its 0:09:56.240 --> 0:09:59.760 payments on its commercial paper repackaging loans. There these project 0:10:00.000 --> 0:10:02.599 financing asset bait commercial papers what they're called. But the 0:10:02.640 --> 0:10:07.040 bottom line is um It's the biggest shareholders is Ganguan. 0:10:07.600 --> 0:10:09.600 There was there's a kind of a government side of this. 0:10:09.679 --> 0:10:12.480 There was the previous mayor that I would say the 0:10:12.520 --> 0:10:15.960 local government that was backing the developer. They wanted to 0:10:16.000 --> 0:10:19.520 bring in this. It has finished. It's the second largest 0:10:19.960 --> 0:10:22.880 UH Lego Land park in the world and then with 0:10:22.960 --> 0:10:26.280 a new president taking over, change of political power, the 0:10:26.320 --> 0:10:29.680 next administration didn't want to back the developer anymore. Anyway, 0:10:29.679 --> 0:10:32.160 It's a long story, but that default just just shot 0:10:32.280 --> 0:10:35.720 through the corporate bond market, yields on five year corporate 0:10:35.720 --> 0:10:38.160 debt rising more than a hundred fifty basis points at 0:10:38.160 --> 0:10:41.760 one point, uh liquidity drying up. And then there was 0:10:41.760 --> 0:10:46.080 an insurance company that didn't call its perpetual bonds bottom line, 0:10:46.080 --> 0:10:48.120 they were going to just pull back their refinancing of 0:10:48.120 --> 0:10:51.520 the bonds, and that was another bang to the corporate 0:10:51.520 --> 0:10:53.800 bond market, and that's created a big loss of confidence. 0:10:53.960 --> 0:10:57.720 It has Koreans worried about investors continuing to want to 0:10:57.760 --> 0:11:01.600 invest in their bond market. And it's not entirely settled yet, 0:11:01.679 --> 0:11:04.120 but it also doesn't in a in a way at 0:11:04.120 --> 0:11:07.520 harkins to what we saw in the UK, where suddenly 0:11:07.760 --> 0:11:10.199 a market that's been stable doesn't seem to be a problem. 0:11:10.240 --> 0:11:11.960 A lot of different things happened. Of course, it was 0:11:12.040 --> 0:11:16.960 the the ill timed and ill designed package budget package 0:11:17.040 --> 0:11:19.439 that Liz Trust had for a while. Anyway, I digress 0:11:19.480 --> 0:11:21.320 a bit, but it's that kind of a thing for 0:11:21.400 --> 0:11:23.480 create seems to stable for now. But talking about the 0:11:23.520 --> 0:11:25.760 Bank of Korea, it's another big reason to say, hey, 0:11:25.760 --> 0:11:27.600 this is not time for a fifty basis point high. 0:11:27.679 --> 0:11:29.960 So that's the corporate story. Then on the household side, 0:11:30.000 --> 0:11:33.000 we know that debt levels are pretty high and viewed 0:11:33.160 --> 0:11:36.640 as being maybe a little vulnerable, although I think Fitch 0:11:36.880 --> 0:11:39.360 Ratings this week had a note said that that vulnerability 0:11:39.400 --> 0:11:42.719 can be managed. Rising interest rates and the way that 0:11:42.720 --> 0:11:45.320 that correlates to mortgage rates in a different way than 0:11:45.360 --> 0:11:49.480 it does in the States puts even greater pressure on 0:11:49.679 --> 0:11:54.080 the households. In Korea, well, about eight of crean households 0:11:54.160 --> 0:11:58.760 have adjustable rate debt, so I believe it was one 0:11:58.760 --> 0:12:01.520 of the b Okay of ischials who said, so a 0:12:01.720 --> 0:12:04.400 fifty basis point hike by the Bank of Korea is 0:12:04.400 --> 0:12:07.079 more like a seventy five basis point hike by someone 0:12:07.120 --> 0:12:09.840 like the Federal Reserve. Remember most most Americans, or at 0:12:09.920 --> 0:12:13.720 least many Americans, have thirty yor fixed rate mortgages, so 0:12:13.760 --> 0:12:16.480 it's a big difference when your central bank starts raising rates. 0:12:16.760 --> 0:12:18.960 So be okay. This week we also have the rb 0:12:19.120 --> 0:12:22.000 n Z, the Reserve Bank of New Zealand. Right now, 0:12:22.040 --> 0:12:24.160 I think that the consensus is that we're going to 0:12:24.240 --> 0:12:28.800 see a much weaker economy in New Zealand in three uh. 0:12:28.840 --> 0:12:31.959 It's really been struggling as many economies across the world 0:12:31.960 --> 0:12:34.800 have been to come back to some degree of normalcy 0:12:34.880 --> 0:12:37.920 after the pandemic. What do we know about the outlook 0:12:38.000 --> 0:12:40.839 for rate policy in New Zealand, Well, we know that 0:12:40.880 --> 0:12:43.400 their inflation rates very high. It's continued to rise. It's 0:12:43.440 --> 0:12:45.600 up to seven point two percent year over year. We 0:12:45.760 --> 0:12:48.960 know that Adrian or, the Governor of the Reserve Bank 0:12:48.960 --> 0:12:51.800 of New Zealand, is not afraid to do aggressive, bold 0:12:51.840 --> 0:12:56.080 moves because remember at the very beginning of the downturn globally, 0:12:56.080 --> 0:12:58.720 when the pandemics started, they suddenly went from one percent 0:12:58.760 --> 0:13:01.160 on their key rate seventy basis point down to zero 0:13:01.240 --> 0:13:03.640 point to five. Who else was They were out front, 0:13:03.880 --> 0:13:05.640 and they were out front on the way back up. 0:13:05.840 --> 0:13:09.720 But I think now they're there. Rad hikes, they're they're 0:13:09.760 --> 0:13:12.960 aggressive tightening have been very effective in hitting the housing market. 0:13:13.200 --> 0:13:16.320 There are high prices, the market was overheated, but and 0:13:16.360 --> 0:13:19.640 that hasn't stopped them yet. And there are other parallels too, 0:13:19.640 --> 0:13:21.560 when you look at the tightness of the labor market 0:13:21.600 --> 0:13:24.360 in the face of higher interest rates. In the States, 0:13:24.520 --> 0:13:28.000 the labor market is pretty pretty tight. Same is true 0:13:28.200 --> 0:13:30.880 in Australia, even though the r b A has been 0:13:30.880 --> 0:13:33.360 tightening the labor market. We just had in the last 0:13:33.400 --> 0:13:37.320 week a shockingly strong employment number, double what the market 0:13:37.360 --> 0:13:41.840 was forecasting. And in New Zealand, labor market conditions are 0:13:41.960 --> 0:13:44.680 very tight. Although I think the expectation now is that 0:13:44.720 --> 0:13:47.720 things will begin to loosen in the new year. Yes, 0:13:47.960 --> 0:13:50.440 but is loosening enough. That's the thing. I think It's 0:13:50.480 --> 0:13:54.200 all relative, isn't it. And that's another reason why Um, 0:13:55.120 --> 0:13:58.240 some of these uh particually. I think developed nation central 0:13:58.280 --> 0:14:01.280 banks or in this position where they can maybe slowed 0:14:01.280 --> 0:14:03.120 down the pace of rate hikes, the size of rate 0:14:03.160 --> 0:14:07.400 hikes for various reasons be okay, their corporate bond markets 0:14:07.440 --> 0:14:11.040 still being in turmoil, still being tight. Um. The RBN said, 0:14:11.080 --> 0:14:13.520 maybe figuring that the what the impact that they've had 0:14:13.520 --> 0:14:16.040 on housing is is pretty what I want to say, significant. 0:14:16.640 --> 0:14:19.040 But at the same time, the economies are holding up 0:14:19.080 --> 0:14:22.000 and their inflation rates are still higher, well above target, 0:14:22.440 --> 0:14:24.840 so the doors open to more hikes at this point, 0:14:25.200 --> 0:14:27.200 just like the FED. The question isn't do they stop 0:14:27.280 --> 0:14:30.280 yet or anything like that. It's just how big. The 0:14:30.720 --> 0:14:35.040 Bloomberg's Global Economics and Policy Editor Kathleen Hayes. I'm Doug Krisner. 0:14:35.080 --> 0:14:37.760 You can join us for Bloomberg Daybreak Asia beginning at 0:14:37.800 --> 0:14:41.280 seven am in Hong Kong, six pm on Wall Street. 0:14:41.480 --> 0:14:43.960 John Doug, thanks a lot, and just to have the 0:14:43.960 --> 0:14:47.680 world cough a N. Cutter. I'm John Tucker is Bloomberg 0:14:57.840 --> 0:15:02.360 broadcasting live from the Bloomberg Getteractive Broker Studio in New York. 0:15:02.440 --> 0:15:07.120 Bloomberg eleven three oh to Washington, d C, Bloomberg to Boston, 0:15:07.200 --> 0:15:10.600 Bloomberg one oh six one to San Francisco, Bloomberg nine 0:15:11.200 --> 0:15:14.520 to the country Sirius XM Channel one nineteen to London 0:15:14.680 --> 0:15:17.440 d A B Digital Radio, and around the globe the 0:15:17.440 --> 0:15:21.360 Bloomberg Business apt in Bloomberg Radio dot Com. This is 0:15:21.400 --> 0:15:30.640 Bloomberg day Break Weekend. I'm John Tucker in New York 0:15:30.720 --> 0:15:32.880 with your global look ahead of the top stories for 0:15:32.920 --> 0:15:36.240 investors in the coming week. Big weekend for Cutter and 0:15:36.400 --> 0:15:39.360 for soccer fans with the World Cup for more. Let's 0:15:39.360 --> 0:15:41.880 send to London and bring in Bloomberg day Break. Euro 0:15:41.960 --> 0:15:46.160 Banker Caroline Hempger, John the Cutter World Cup is becoming 0:15:46.320 --> 0:15:50.040 one of the most controversial sporting events in history. Cut 0:15:49.880 --> 0:15:52.320 a country of three million people, won the vote to 0:15:52.480 --> 0:15:56.760 host the tournament back in despite its scorching climate and 0:15:56.840 --> 0:16:00.320 lack of footballing history. It's faced enormous critics is um 0:16:00.440 --> 0:16:04.000 for its lack of freedom's mistreatment of migrant workers a 0:16:04.080 --> 0:16:09.000 country where homosexuality is illegal. But Cutter has defended itself 0:16:09.040 --> 0:16:13.360 against the sports washing accusations and the event could deliver 0:16:13.640 --> 0:16:18.200 record revenue for organizers FIFA and a diplomatic dividend. Now. 0:16:18.320 --> 0:16:22.280 FIFA's president Gianni Infantino says that the tournament and cut 0:16:22.320 --> 0:16:26.120 Are can be used as a force for good. Football 0:16:26.400 --> 0:16:29.120 and the World Cup are offering you and the world 0:16:29.280 --> 0:16:33.480 a unique platform of unity and these all over the world. 0:16:33.680 --> 0:16:36.120 So let's take this opportunity to where everything we can 0:16:36.480 --> 0:16:40.960 to start something. An end to all conflicts, okay, an 0:16:41.120 --> 0:16:44.320 enter all conflicts. So in Fantino also did as a 0:16:44.440 --> 0:16:49.040 ceasefire in Ukraine for the month long World Cup. Well 0:16:49.040 --> 0:16:51.760 for more. Joining me now is Bienberg, Simon and Foxman 0:16:51.800 --> 0:16:54.720 in Doha and here in the London studio, David Hellier. 0:16:55.000 --> 0:16:57.680 Welcome to both of you to discuss I mean, what 0:16:57.920 --> 0:17:01.560 is a huge event in the footballing in the global 0:17:01.680 --> 0:17:05.120 sporting calendar. David, can I ask you first? I mean 0:17:05.160 --> 0:17:09.920 Cutter wanted a global platform through football. It really has one. 0:17:10.400 --> 0:17:12.439 What do you think this World Cup is going to 0:17:12.520 --> 0:17:18.000 be like? Well, I mean, obviously the jury is out 0:17:18.040 --> 0:17:21.000 on this, um. I mean the build up has been 0:17:21.160 --> 0:17:25.879 unremitting lye uh you know negative in terms of criticisms 0:17:25.920 --> 0:17:30.560 of of of the country and it's it's sort of 0:17:31.080 --> 0:17:36.120 treatment the migrant workers and uh LGBT rights, um, all 0:17:36.119 --> 0:17:40.479 that kind of thing. Um. But on the from on 0:17:40.520 --> 0:17:44.320 the on on the other side, you know, a number 0:17:44.359 --> 0:17:47.959 of stadiums have been built that look amazing. Uh. There 0:17:47.960 --> 0:17:50.760 would have been a you know, a great rebuilding the 0:17:50.800 --> 0:17:54.840 infrastructure of guitar. So from that point of view, it 0:17:54.920 --> 0:17:59.679 leaves a useful legacy for the country. Um. But we 0:17:59.760 --> 0:18:03.320 really I don't think we've really seen anything quite like 0:18:03.400 --> 0:18:09.399 this before. The clash of cultures and it really, you know, 0:18:09.840 --> 0:18:14.400 it really will depend on how uh you know, how 0:18:14.480 --> 0:18:19.159 they mix, um, And so we wait and see. I 0:18:19.200 --> 0:18:22.000 guess yeah, and I know of course, because hey, you 0:18:22.040 --> 0:18:24.880 are a huge football fan. Also you write a great 0:18:24.960 --> 0:18:27.440 deal about the business of sports and you're going to 0:18:27.560 --> 0:18:31.560 be in Cutter to actually see some of the footballing 0:18:31.560 --> 0:18:35.360 action and simone in Doha. I mean, this is this 0:18:35.480 --> 0:18:39.479 is it isn't it? It's Western footballing countries kind of 0:18:39.520 --> 0:18:42.880 outrage that cut off for all the reasons that I mentioned, 0:18:42.960 --> 0:18:47.560 is actually hosting the event. What are the Qataris see? 0:18:47.680 --> 0:18:51.160 How do they see it? You know, I think there's 0:18:51.560 --> 0:18:55.600 a degree of surprise that some of the criticism has 0:18:55.680 --> 0:18:58.199 gone on for so long. Mind you, it's not just 0:18:58.359 --> 0:19:02.200 about human rights where or migrant rights, or the rights 0:19:02.200 --> 0:19:07.440 of minorities, including LGBT people, but it's also remember think 0:19:07.520 --> 0:19:10.600 back to um the early twenty tens when there were 0:19:10.640 --> 0:19:15.119 all these swirling controversies around corruption. You know, Cutter is 0:19:15.800 --> 0:19:19.080 thought to have won this bid to host the World Cup, 0:19:19.400 --> 0:19:23.400 um maybe for unsavory reasons, as well as Russia eighteen. 0:19:24.200 --> 0:19:26.720 And I think particularly in the UK, you know, fans 0:19:26.760 --> 0:19:31.120 haven't really forgotten about that. Here on the ground, though, 0:19:31.400 --> 0:19:34.280 you know, the attitude has changed a little bit. I 0:19:34.280 --> 0:19:39.120 think there was some openness to labor reforms. Certainly the 0:19:39.200 --> 0:19:42.720 expose as that came out painted a very dire picture 0:19:42.800 --> 0:19:45.400 of what life is like for the lowest income workers. 0:19:46.440 --> 0:19:51.280 But this campaign has been unrelenting, and recently Mohammad Athani, 0:19:51.400 --> 0:19:56.040 the ruling emir, talked about this as an unprecedented campaign 0:19:56.280 --> 0:20:00.880 against the country for reasons that may not be um. 0:20:01.240 --> 0:20:03.880 I guess I'm just may not be so justified. And 0:20:04.040 --> 0:20:05.919 so we've sort of seen that kind of evolved a 0:20:05.960 --> 0:20:11.000 bit more resistance. Okay, so football, but also much beyond 0:20:11.119 --> 0:20:14.560 football as we look ahead to the World Cup two. 0:20:14.600 --> 0:20:16.360 Thank you so much for being with me, blom Big 0:20:16.400 --> 0:20:19.600 Simone Foxman in Doha and David Helliot in London. Of 0:20:19.640 --> 0:20:23.280 course they'll be at some of the matches in cutter 0:20:23.800 --> 0:20:26.480 and I'm callin Heger here in London. You can catch 0:20:26.560 --> 0:20:29.719 me every weekday morning for bloom Bag Daybreak. That's beginning 0:20:29.720 --> 0:20:32.000 at six am in London, one am on Wall Street, 0:20:32.080 --> 0:20:34.920 John Caroline, thanks alone just to hear on Bloomberg Daybreak 0:20:34.960 --> 0:20:38.560 weekend the battle lines already being drawn for the four 0:20:38.680 --> 0:20:54.200 presidential race. I'm John Tucker. Emptis Bloomberg. This agains Bloomberg 0:20:54.240 --> 0:20:56.600 Daybreak Weekend, our global look ahead of the top stories 0:20:56.640 --> 0:20:58.760 for investors in the coming week. I'm John Tucker in 0:20:58.800 --> 0:21:02.000 New York. A lot of uncertain among Republicans and some 0:21:02.119 --> 0:21:05.359 level of uncertain among Democrats as well as we start 0:21:05.480 --> 0:21:09.800 to set up now for the presidential race. More. Let's 0:21:09.880 --> 0:21:13.359 into our Bloomberg ninety one one newsroom in Washington and 0:21:13.560 --> 0:21:16.159 Amy Morris Amy, all right, thank you, John. One of 0:21:16.200 --> 0:21:19.440 the biggest question marks hanging over the GOP right now 0:21:19.520 --> 0:21:22.800 after the midterms. What comes next for the GOP and 0:21:22.960 --> 0:21:25.040 Donald Trump? Who want to take a deeper look at 0:21:25.040 --> 0:21:28.720 this with Bloomberg editor Megan Crane. Megan, thank you for 0:21:28.800 --> 0:21:31.400 taking the time with us today. Oh, thanks for having me. Now, 0:21:31.480 --> 0:21:34.720 Donald Trump announced his own plans to run for president 0:21:34.760 --> 0:21:38.080 again from his Moral Lago estate in Florida, in order 0:21:38.119 --> 0:21:41.840 to make America grated glorious again. I am tonight announcing 0:21:41.880 --> 0:21:46.840 my candidacy for president of the United States. Now. He 0:21:46.920 --> 0:21:50.280 seemed a bit muted during that announcement compared to the 0:21:50.359 --> 0:21:53.600 last time he ran Megan, what's your thoughts? Um. You 0:21:53.640 --> 0:21:56.159 know a lot of people have said that the announcement 0:21:56.240 --> 0:21:59.800 sounded more uh muted is the right word, yeah, sort 0:21:59.800 --> 0:22:02.960 of a less energetic. Um. He did say that he's 0:22:03.000 --> 0:22:08.200 hoping to recapture the underdog spirit of UM a smaller, 0:22:08.280 --> 0:22:13.280 scrappier campaign apparatus than he had in Um. You know, 0:22:13.440 --> 0:22:16.000 it's harder to make an announcement in front of a 0:22:16.080 --> 0:22:17.919 room full of your friends at Mara Lego than it 0:22:18.000 --> 0:22:20.760 is in front of a crowd of supporters, you know, 0:22:21.040 --> 0:22:23.119 sort of out in the country somewhere. But you know, 0:22:23.160 --> 0:22:24.920 it sort of remains to be seen whether he's able 0:22:24.960 --> 0:22:28.240 to recapture that energy. Now Here's what fellow Republican New 0:22:28.240 --> 0:22:31.720 Hampshire Governor Chris Sunew had to say, Uh, the same time, 0:22:31.760 --> 0:22:35.000 at the night that the former president was announcing, the 0:22:35.040 --> 0:22:38.879 political atmosphere today will be a hundred eighty degrees different 0:22:38.960 --> 0:22:42.080 six months from now, eighty degrees six months after that, 0:22:42.359 --> 0:22:44.359 and then we'll get to June of twenty four and 0:22:44.440 --> 0:22:46.439 we'll we'll see where we are there. It's gonna go 0:22:46.640 --> 0:22:48.720 up and down and in and out. We are so 0:22:48.800 --> 0:22:50.760 far away from all of it. So that's why I 0:22:50.760 --> 0:22:51.919 say it's going to be kind of an up and 0:22:51.960 --> 0:22:53.920 down wild right. Enjoy the show because we are so 0:22:54.040 --> 0:22:57.840 far whatever whatever announcements may or may not be happening tonight, 0:22:58.640 --> 0:23:01.800 Uh right, that nobody is going to care. That was 0:23:01.880 --> 0:23:04.840 New Hampshire Governor Christannu Knew speaking there at the Republican 0:23:04.880 --> 0:23:08.040 Governor's Conference. And I guess what I want to know 0:23:08.119 --> 0:23:11.560 about that, Megan, is are we starting to see a 0:23:11.640 --> 0:23:15.320 shift or a rift? Are we starting to see a 0:23:15.480 --> 0:23:19.359