1 00:00:00,080 --> 00:00:07,000 Speaker 1: Bloomberg Audio Studios, podcasts, radio news. 2 00:00:09,880 --> 00:00:13,240 Speaker 2: This is the Bloomberg DAYBAC podcast, available every morning on Apple, 3 00:00:13,320 --> 00:00:16,360 Speaker 2: Spotify or wherever you listen. It's Tuesday, the twenty fifth 4 00:00:16,400 --> 00:00:18,800 Speaker 2: of March in London. I'm Caroline Hepka. 5 00:00:18,760 --> 00:00:20,640 Speaker 1: And I'm Stephen Carroll. Coming up today. 6 00:00:20,720 --> 00:00:24,400 Speaker 3: Donald Trump's top team accidentally includes a journalist in their 7 00:00:24,440 --> 00:00:26,640 Speaker 3: group chat discussing military strikes. 8 00:00:26,880 --> 00:00:30,280 Speaker 2: The US President shows further confusion about his plans for 9 00:00:30,360 --> 00:00:34,560 Speaker 2: sweeping levies as he talks of exemptions for some countries. 10 00:00:34,400 --> 00:00:37,240 Speaker 3: Plus the Bank of England Andrew Bailey says Britain needs 11 00:00:37,400 --> 00:00:40,640 Speaker 3: AI to boost its long term growth prospects. 12 00:00:40,840 --> 00:00:42,880 Speaker 2: Let's start with a roundup of our top stories. 13 00:00:43,320 --> 00:00:47,080 Speaker 3: The Trump administration is confronting a major security breach after 14 00:00:47,159 --> 00:00:50,279 Speaker 3: a journalist was inadvertently added to a text group by 15 00:00:50,400 --> 00:00:54,120 Speaker 3: US National Security Advisor Mike Waltz. The group chat on 16 00:00:54,200 --> 00:00:58,000 Speaker 3: the Signal messaging app, was used to discuss detailed plans 17 00:00:58,040 --> 00:01:01,200 Speaker 3: to bomb hoothy targets and Yemen, and it included the 18 00:01:01,280 --> 00:01:05,160 Speaker 3: US Defense Secretary, vice President, Secretary of State, and Director 19 00:01:05,200 --> 00:01:08,760 Speaker 3: of the CIA, along with other top officials. Speaking to 20 00:01:08,800 --> 00:01:12,440 Speaker 3: ABC News, The Atlantics editor in chief Jeffrey Goldberg said 21 00:01:12,440 --> 00:01:14,560 Speaker 3: at first he thought the group was a hoax. 22 00:01:15,200 --> 00:01:21,119 Speaker 4: It seemed completely absurd to me that the national security 23 00:01:21,160 --> 00:01:23,720 Speaker 4: leadership in the United States would be meeting on a 24 00:01:23,840 --> 00:01:30,040 Speaker 4: messaging app to discuss forthcoming military action, and that they 25 00:01:30,040 --> 00:01:34,640 Speaker 4: would also sort of invite the editor of The Atlantic magazine. 26 00:01:34,920 --> 00:01:37,080 Speaker 3: Jeffrey Goldberg went on to say that at one point, 27 00:01:37,120 --> 00:01:40,399 Speaker 3: Defense Secretary Pete Hegseth shared a post that included what 28 00:01:40,520 --> 00:01:44,520 Speaker 3: he said were operational details of forthcoming strikes on Yemen, 29 00:01:44,840 --> 00:01:48,880 Speaker 3: including information about targets, weapons the US would be deploying, 30 00:01:49,040 --> 00:01:52,960 Speaker 3: and attack sequencing. Speaking after The Atlantic published its story, 31 00:01:53,000 --> 00:01:55,880 Speaker 3: Hegseeth sought to dismiss the claims in this exchange with 32 00:01:55,920 --> 00:01:56,360 Speaker 3: a reporter. 33 00:01:57,000 --> 00:01:59,120 Speaker 5: How did you learn that a journalist was privy to 34 00:01:59,360 --> 00:02:03,080 Speaker 5: the target, the types of weapons used, I've. 35 00:02:03,000 --> 00:02:04,160 Speaker 1: Heard I was characterized. 36 00:02:04,720 --> 00:02:08,440 Speaker 6: Nobody was texting war plans, and that's all I. 37 00:02:08,360 --> 00:02:09,040 Speaker 1: Have to say about that. 38 00:02:09,280 --> 00:02:11,760 Speaker 3: Hegsath's efforts to play down the league came as White 39 00:02:11,760 --> 00:02:15,200 Speaker 3: House National Security spokesman Brian Hughes said the message thread 40 00:02:15,240 --> 00:02:18,120 Speaker 3: appears to be authentic and that they were reviewing how 41 00:02:18,160 --> 00:02:20,480 Speaker 3: an inadvertent number was added to the chain. 42 00:02:21,200 --> 00:02:25,760 Speaker 2: The private texts among top US officials also revealed how 43 00:02:25,840 --> 00:02:30,480 Speaker 2: some members of the Trump administration feel about their European allies. 44 00:02:30,800 --> 00:02:33,000 Speaker 2: With more here is Bloomberg's James Wilcock. 45 00:02:33,840 --> 00:02:36,640 Speaker 7: Back and forth between Vice President JD. Vance and the 46 00:02:36,680 --> 00:02:40,200 Speaker 7: Defense Secrety Pete Hegseth will make for particularly troubling reading 47 00:02:40,360 --> 00:02:44,040 Speaker 7: in many European capitals. A user identified Advance in the 48 00:02:44,120 --> 00:02:47,080 Speaker 7: chat wrote, it plans to strike who the targets? Quote 49 00:02:47,400 --> 00:02:51,360 Speaker 7: I just hate bailing Europe out again. Heg Seth reportedly 50 00:02:51,400 --> 00:02:55,240 Speaker 7: responded three minutes later, quote VP, I fully share your 51 00:02:55,280 --> 00:02:59,760 Speaker 7: loathing of European free loading. It's pathetic. White House National 52 00:03:00,040 --> 00:03:02,560 Speaker 7: Curity Advisor Mike Waltz goes on to say that the 53 00:03:02,639 --> 00:03:05,120 Speaker 7: US would taliate the cough associated with the strike on 54 00:03:05,160 --> 00:03:08,359 Speaker 7: the Hoho thies and levy them on the Europeans at 55 00:03:08,400 --> 00:03:11,880 Speaker 7: Donald Trump's request. The US president claimed to be unaware 56 00:03:11,880 --> 00:03:14,680 Speaker 7: of the breach when asked about it an event later Monday. 57 00:03:15,080 --> 00:03:18,480 Speaker 7: His spokeswoman, Caroline Levitt said in the statement he has 58 00:03:18,520 --> 00:03:22,360 Speaker 7: the utmost confidence in his national security team, including Waltz. 59 00:03:22,840 --> 00:03:25,160 Speaker 7: In London, James Wallcock Bloomberg Radio. 60 00:03:25,880 --> 00:03:29,000 Speaker 3: Donald Trump says his TARAF rollout on the second of April, 61 00:03:29,000 --> 00:03:32,919 Speaker 3: will feature rates on a country by country basis, corresponding 62 00:03:32,960 --> 00:03:36,600 Speaker 3: to trade barriers on US products. Speaking to reporters, the 63 00:03:36,640 --> 00:03:40,800 Speaker 3: president twice signals that trading partners may be given exemptions 64 00:03:41,000 --> 00:03:41,880 Speaker 3: or reductions. 65 00:03:42,280 --> 00:03:44,760 Speaker 5: We may take less than what they're charging because they've 66 00:03:44,840 --> 00:03:45,680 Speaker 5: charged us so much. 67 00:03:45,720 --> 00:03:46,920 Speaker 1: I don't think they could take it. 68 00:03:47,160 --> 00:03:50,240 Speaker 5: In other words, they've charged us so much that I'm 69 00:03:50,280 --> 00:03:53,400 Speaker 5: embarrassed to charge them what they've charged us. But it'll 70 00:03:53,440 --> 00:03:57,320 Speaker 5: be substantial, and you'll be hearing about that on April second. 71 00:03:57,800 --> 00:04:00,440 Speaker 3: Trump's comments so at further confusion about it is plans 72 00:04:00,480 --> 00:04:03,640 Speaker 3: for a sweeping tariff announcements scheduled for next week, which 73 00:04:03,680 --> 00:04:07,240 Speaker 3: he's dubbed Liberation Day. The President also said he planned 74 00:04:07,240 --> 00:04:09,960 Speaker 3: to proceed with tariffs on auto imports over the next 75 00:04:10,000 --> 00:04:13,920 Speaker 3: few days, as well as measures targeting lumber and semiconductors 76 00:04:14,240 --> 00:04:14,920 Speaker 3: down the road. 77 00:04:15,680 --> 00:04:19,960 Speaker 2: HSBC is considering outsourcing parts of its trading business to 78 00:04:20,000 --> 00:04:24,000 Speaker 2: save on technology costs. Bloomback has learned that internal discussions 79 00:04:24,040 --> 00:04:26,200 Speaker 2: have been held at the bank about sending some of 80 00:04:26,240 --> 00:04:29,560 Speaker 2: its fixed income orders to an outside market maker like 81 00:04:29,720 --> 00:04:33,760 Speaker 2: Jane Street or Citadel. In a separate exclusive interview with Bloomberg. 82 00:04:33,960 --> 00:04:38,560 Speaker 2: HSBC CEO Georgel Hedri stress the importance of the bank's 83 00:04:38,640 --> 00:04:40,159 Speaker 2: wider restructuring drive. 84 00:04:40,800 --> 00:04:43,520 Speaker 6: We're also looking at the what we do and recognize 85 00:04:43,600 --> 00:04:47,000 Speaker 6: that there are further focus that we can achieve in 86 00:04:47,040 --> 00:04:50,520 Speaker 6: own business, where we will be taking one and a 87 00:04:50,520 --> 00:04:54,200 Speaker 6: half billion dollars from activities that we are currently doing 88 00:04:54,600 --> 00:04:58,600 Speaker 6: that are either non strategic or non returning. 89 00:05:00,360 --> 00:05:03,440 Speaker 2: Hedri they are speaking to Bloomberg at the HSBC Global 90 00:05:03,480 --> 00:05:06,360 Speaker 2: invest Summit in Hong Kong. He went on to say 91 00:05:06,400 --> 00:05:09,960 Speaker 2: the bank expects to double down on investment banking in 92 00:05:10,040 --> 00:05:13,200 Speaker 2: Asia in the Middle East after exiting key businesses in 93 00:05:13,240 --> 00:05:14,320 Speaker 2: Europe and the US. 94 00:05:14,800 --> 00:05:17,080 Speaker 3: The Governor of the Bank of England says Britain needs 95 00:05:17,080 --> 00:05:20,600 Speaker 3: a breakthrough like artificial intelligence to break out of its 96 00:05:20,640 --> 00:05:23,960 Speaker 3: low growth trap. Speaking to students at Leicester University, Andrew 97 00:05:24,000 --> 00:05:28,360 Speaker 3: Bailey said that advanced economies like the UK needed productivity 98 00:05:28,440 --> 00:05:33,039 Speaker 3: enhancing technologies to sustain their aging populations. The Central Bank 99 00:05:33,120 --> 00:05:35,479 Speaker 3: chief went on to say he's not concerned about AI 100 00:05:35,680 --> 00:05:39,960 Speaker 3: taking people's jobs. The speech comes as the financial regulator 101 00:05:40,000 --> 00:05:42,320 Speaker 3: has told firms they can stop following more than one 102 00:05:42,400 --> 00:05:45,920 Speaker 3: hundred pages of guidance on mortgages and investments. It's part 103 00:05:45,920 --> 00:05:49,920 Speaker 3: of a government drive to slash regulation to boost growth now. 104 00:05:50,040 --> 00:05:53,839 Speaker 2: The US and Russian officials held twelve hours of talks 105 00:05:53,880 --> 00:05:56,800 Speaker 2: over Ukraine in Saudi Arabia yesterday. The two sides are 106 00:05:56,800 --> 00:06:00,560 Speaker 2: expected to release a statement detailing their progress later, but 107 00:06:00,640 --> 00:06:04,560 Speaker 2: a Kremlin spokesman said they discuss navigation in the black seat. 108 00:06:04,600 --> 00:06:08,520 Speaker 2: The negotiations follow discussions between the US and Ukraine on Sunday. 109 00:06:08,920 --> 00:06:12,760 Speaker 2: Ukraine's President Vlodomi Zelinsky says strong measures will be needed 110 00:06:12,800 --> 00:06:14,680 Speaker 2: to keep Russia on the path of peace. 111 00:06:16,400 --> 00:06:19,920 Speaker 8: We need a movement towards real peace, towards guaranteed security, 112 00:06:20,160 --> 00:06:23,400 Speaker 8: and we all need this in Ukraine and Europe and America, 113 00:06:23,680 --> 00:06:26,760 Speaker 8: everyone in the world who wants peace in international relations, 114 00:06:27,440 --> 00:06:29,800 Speaker 8: Russia is the only entity that is dragging out this 115 00:06:29,920 --> 00:06:32,800 Speaker 8: war and mocking our people and the whole world. And 116 00:06:32,880 --> 00:06:37,599 Speaker 8: to pressure Russia towards peace, strong things, strong steps are needed. 117 00:06:38,520 --> 00:06:41,920 Speaker 2: Zelinski and President Trump still have not signed a pack 118 00:06:42,040 --> 00:06:46,000 Speaker 2: to give the US part ownership of Ukraine's natural resources. 119 00:06:46,400 --> 00:06:49,880 Speaker 2: Russia has continued to farm missiles and drones at Ukrainian 120 00:06:49,960 --> 00:06:51,560 Speaker 2: cities during the talks. 121 00:06:52,160 --> 00:06:55,680 Speaker 3: Bloomberg understands the Turkey's finance Minister, a mem Shimchek, will 122 00:06:55,680 --> 00:06:59,320 Speaker 3: hold a call with international investors today. The move comes 123 00:06:59,360 --> 00:07:02,400 Speaker 3: as authority you seek to cam markets after days of 124 00:07:02,480 --> 00:07:05,680 Speaker 3: turbulence triggered by the arrest of a key opposition figures. 125 00:07:06,120 --> 00:07:09,000 Speaker 3: According to two sources, the minister's schedule to speak at 126 00:07:09,080 --> 00:07:13,280 Speaker 3: one pm London time in a teleconference. Turkish markets have 127 00:07:13,280 --> 00:07:17,360 Speaker 3: been under pressure since last Wednesday, when Istanbul Mayor Ekrem Immolu, 128 00:07:17,680 --> 00:07:21,680 Speaker 3: we're widely seen as President Erduan's biggest rival, was detained 129 00:07:22,000 --> 00:07:24,200 Speaker 3: and later formally arrested. 130 00:07:25,000 --> 00:07:27,520 Speaker 2: Those are our top stories for you this morning. Thinking 131 00:07:27,560 --> 00:07:31,800 Speaker 2: about the markets. Well, oil ahead of that US Russia 132 00:07:31,880 --> 00:07:35,720 Speaker 2: statement later today, is a bit steadier this morning in 133 00:07:35,800 --> 00:07:40,680 Speaker 2: terms of futures. As for stock futures, they are down 134 00:07:40,720 --> 00:07:42,360 Speaker 2: now three tens of one percent for the US stocks 135 00:07:42,400 --> 00:07:45,200 Speaker 2: fifty futures. US stock futures also in the red. Despite 136 00:07:45,240 --> 00:07:47,280 Speaker 2: the major gains that we saw yesterday, The S and 137 00:07:47,320 --> 00:07:49,680 Speaker 2: pv founder closed up one point eight percent, the third 138 00:07:49,760 --> 00:07:54,200 Speaker 2: best session this year, on the likelihood of less severe 139 00:07:54,600 --> 00:07:57,679 Speaker 2: tariff measures by the Trump administration. The Nasak also close 140 00:07:58,120 --> 00:08:01,400 Speaker 2: by two point two percent. Treasury yields rose yesterday two 141 00:08:01,440 --> 00:08:04,160 Speaker 2: year yelds back above four percent. Tenure yields rose nine 142 00:08:04,200 --> 00:08:07,800 Speaker 2: basis points. Treasuries are steadied this morning, are currently trading 143 00:08:07,800 --> 00:08:10,560 Speaker 2: at four thirty three on ten year yields. But in 144 00:08:10,600 --> 00:08:13,320 Speaker 2: Asia we've seen a cell of the SSCI China Index 145 00:08:13,320 --> 00:08:15,960 Speaker 2: down one point nine percent, the Hanksing Index down more 146 00:08:16,000 --> 00:08:19,880 Speaker 2: than two percent, Chinese tech stocks resuming a slide after 147 00:08:20,240 --> 00:08:23,040 Speaker 2: Monday's short lived gains. Those are the markets. 148 00:08:23,320 --> 00:08:25,200 Speaker 3: In a moment, we'll bring you more and Andrew Bailey's 149 00:08:25,200 --> 00:08:27,640 Speaker 3: comments on how the UK can tackle its problem of 150 00:08:27,720 --> 00:08:31,080 Speaker 3: low growth. But the story that's got our attention this morning, 151 00:08:31,200 --> 00:08:35,800 Speaker 3: even the headline itself, seems incredible. The Trump administration accidentally 152 00:08:35,880 --> 00:08:37,880 Speaker 3: texted me its war plans. 153 00:08:38,400 --> 00:08:40,679 Speaker 1: This is the piece from the Atlantics. Jeffrey Goldberg. 154 00:08:40,760 --> 00:08:42,920 Speaker 3: We heard from him there a moment ago, publishing this 155 00:08:43,000 --> 00:08:45,920 Speaker 3: account of how he was accidentally added to a group 156 00:08:46,000 --> 00:08:49,120 Speaker 3: chat on the Signal app with this group of top 157 00:08:49,280 --> 00:08:52,840 Speaker 3: US officials to identify themselves as the Defense Secretary, u S, 158 00:08:52,840 --> 00:08:56,760 Speaker 3: Secretary of State, National Security Advisor, et cetera. They detailed 159 00:08:57,080 --> 00:09:00,400 Speaker 3: plans about their attack on Yamat. It's a chrono logical 160 00:09:00,440 --> 00:09:03,640 Speaker 3: account in many ways of exactly how things unfolded and 161 00:09:03,760 --> 00:09:06,480 Speaker 3: includes a lot of Jeffrey Golberg's skepticism when he was 162 00:09:06,520 --> 00:09:08,600 Speaker 3: added tode that he thought essentially was a hoax. 163 00:09:08,800 --> 00:09:10,720 Speaker 1: Yeah, he did. He was very wary. 164 00:09:11,760 --> 00:09:16,040 Speaker 2: Look, this is an extraordinary moment, I think, and his 165 00:09:16,160 --> 00:09:18,680 Speaker 2: account of the messages and the sequencing running up to 166 00:09:18,720 --> 00:09:22,839 Speaker 2: the attacks that he then he was so skeptical. He 167 00:09:22,920 --> 00:09:25,719 Speaker 2: was wondering whether the details around the plans of the 168 00:09:25,760 --> 00:09:29,120 Speaker 2: attacks on Yemen were real And he only really understood 169 00:09:29,679 --> 00:09:32,960 Speaker 2: that this probably was the real thing when he did 170 00:09:33,000 --> 00:09:35,720 Speaker 2: see the explosions in the reports of explosions in Sona 171 00:09:35,840 --> 00:09:36,360 Speaker 2: in Yemen. 172 00:09:37,080 --> 00:09:40,240 Speaker 3: Well, this is the story with major consequences. Let's bring 173 00:09:40,240 --> 00:09:43,439 Speaker 3: in our senior editor, Derek Wallbank to discuss. Derek, an 174 00:09:43,440 --> 00:09:47,280 Speaker 3: extraordinary security breach by any account, How damaging is this 175 00:09:47,400 --> 00:09:48,199 Speaker 3: for the White House? 176 00:09:49,400 --> 00:09:50,720 Speaker 9: Well, thank you so much for having me. 177 00:09:50,840 --> 00:09:51,040 Speaker 10: Yeah. 178 00:09:51,120 --> 00:09:53,440 Speaker 9: I think that this is something that is going to 179 00:09:53,520 --> 00:09:55,360 Speaker 9: reverberate for quite a while. 180 00:09:55,480 --> 00:09:55,640 Speaker 5: Now. 181 00:09:55,679 --> 00:09:58,200 Speaker 9: How it reverberates very much remains to be seen, and 182 00:09:58,320 --> 00:10:01,959 Speaker 9: depends in large part on how Republicans in Congress are 183 00:10:02,000 --> 00:10:04,760 Speaker 9: going to address it. So far, we have seen sort 184 00:10:04,800 --> 00:10:10,360 Speaker 9: of vague language talking about needing to to figure out 185 00:10:10,440 --> 00:10:14,920 Speaker 9: what happened, but it's fallen far short of cries for 186 00:10:15,440 --> 00:10:19,680 Speaker 9: full throated investigations, and it's really not gone anywhere near 187 00:10:19,840 --> 00:10:24,720 Speaker 9: the idea that heads need to roll over it metaphorically speaking, right, 188 00:10:25,720 --> 00:10:29,480 Speaker 9: And so it's one of those situations where Republicans do 189 00:10:29,600 --> 00:10:34,120 Speaker 9: hold all leavers of power in Washington, and thus this 190 00:10:34,200 --> 00:10:37,480 Speaker 9: is a sort of own self police, owned self situation, 191 00:10:38,440 --> 00:10:42,319 Speaker 9: as one would say here in Singapore. That having been said, 192 00:10:43,000 --> 00:10:45,040 Speaker 9: Democrats are going to try and make a meal of this. 193 00:10:45,160 --> 00:10:48,640 Speaker 9: Democrats have been on the defensive for the last several months, 194 00:10:48,679 --> 00:10:53,599 Speaker 9: looking for a way in, looking for sort of anything, 195 00:10:53,760 --> 00:10:59,720 Speaker 9: as it were, and they are absolutely, you know, appalled 196 00:10:59,840 --> 00:11:03,360 Speaker 9: at this minute. And where this is particularly I think 197 00:11:04,320 --> 00:11:07,240 Speaker 9: in light of the fact that Republicans have made such 198 00:11:07,280 --> 00:11:11,680 Speaker 9: a big deal about methods of communication. One only needs 199 00:11:11,720 --> 00:11:16,520 Speaker 9: to remember the but her emails, stuff with Hillary Clinton, 200 00:11:16,640 --> 00:11:21,760 Speaker 9: right private server, all of those things. And so there 201 00:11:21,800 --> 00:11:24,720 Speaker 9: are charges from Democrats not just of that this was 202 00:11:24,920 --> 00:11:32,080 Speaker 9: horrible operation security, but also stunning amount of political hypocrisy. 203 00:11:32,559 --> 00:11:38,439 Speaker 2: Indeed, but then concerns about, you know, what the actual 204 00:11:39,000 --> 00:11:41,600 Speaker 2: content of this might have meant had a kind of 205 00:11:41,920 --> 00:11:44,920 Speaker 2: hostile actor been able to see this. The White House 206 00:11:44,960 --> 00:11:49,199 Speaker 2: confirming the tech exchange appeared to be genuine. What has 207 00:11:49,200 --> 00:11:51,080 Speaker 2: the Trump administration responded? 208 00:11:52,080 --> 00:11:54,959 Speaker 9: That's exactly right, and I do think that that's one 209 00:11:54,960 --> 00:11:57,600 Speaker 9: of the things that's going to be very in focus. 210 00:11:58,280 --> 00:12:02,840 Speaker 9: There was no obvious I guess I would say, no, 211 00:12:02,840 --> 00:12:07,200 Speaker 9: no obvious, no public outfall of this in terms of 212 00:12:07,400 --> 00:12:11,520 Speaker 9: US security in that particular mission. The mission went through 213 00:12:11,559 --> 00:12:14,560 Speaker 9: as it was meant to go. From all that we 214 00:12:14,679 --> 00:12:18,920 Speaker 9: know so far, there were no lives lost. But certainly 215 00:12:18,960 --> 00:12:22,679 Speaker 9: this is one of those things that that that will 216 00:12:22,679 --> 00:12:25,120 Speaker 9: be you know, looked at it. Certainly if if you 217 00:12:25,160 --> 00:12:28,240 Speaker 9: were if you were an adversarial power, you would be 218 00:12:28,280 --> 00:12:31,160 Speaker 9: thinking to yourself, right now, oh wow, we have we 219 00:12:31,280 --> 00:12:35,240 Speaker 9: have way more opportunity to intercept the true thoughts. And 220 00:12:35,320 --> 00:12:37,079 Speaker 9: the other thing that I would mention is that there 221 00:12:37,120 --> 00:12:41,880 Speaker 9: was a tremendous amount of valuable knowledge gleaned from being 222 00:12:41,960 --> 00:12:45,480 Speaker 9: able to see to sort of open the curtain and 223 00:12:45,559 --> 00:12:50,960 Speaker 9: see what the real thoughts happened to be. Who is 224 00:12:51,040 --> 00:12:54,520 Speaker 9: in the room for these conversations. That's really useful. What 225 00:12:54,640 --> 00:12:57,040 Speaker 9: are the arguments and where you know, where are people 226 00:12:57,080 --> 00:12:59,440 Speaker 9: coming from? That's also useful. And I think that is 227 00:12:59,480 --> 00:13:02,720 Speaker 9: going to be something that that friends and foes alike 228 00:13:02,880 --> 00:13:04,080 Speaker 9: are going to be studying. 229 00:13:05,600 --> 00:13:08,319 Speaker 3: Meanwhile, following the latest on the tariff news as well, 230 00:13:08,360 --> 00:13:13,000 Speaker 3: Donald Trump speaking about this yesterday, promising some sector specific 231 00:13:13,080 --> 00:13:16,520 Speaker 3: levies ahead of the announcement. We've been looking towards next 232 00:13:16,520 --> 00:13:20,080 Speaker 3: week of the broader what Trump described as reciprocal tariffs 233 00:13:20,679 --> 00:13:23,679 Speaker 3: as well. What more did we learn about the president's plans. 234 00:13:24,320 --> 00:13:27,040 Speaker 9: Well, I think the biggest thing that we learned overnight 235 00:13:27,520 --> 00:13:32,920 Speaker 9: was that the US administration is really open to the 236 00:13:33,000 --> 00:13:39,640 Speaker 9: idea of negotiated carve outs, if one will. This is 237 00:13:39,679 --> 00:13:41,320 Speaker 9: something that I think that a lot of countries have 238 00:13:41,320 --> 00:13:45,080 Speaker 9: been trying to figure out how to secure to little 239 00:13:45,200 --> 00:13:51,280 Speaker 9: end so far. But Trump was basically suggesting that the 240 00:13:51,640 --> 00:13:55,280 Speaker 9: reciprocal tariffs may not be fully reciprocal, and there were 241 00:13:55,320 --> 00:13:59,120 Speaker 9: some suggestions that there could be deals cut. Now, Trump, 242 00:13:59,360 --> 00:14:02,160 Speaker 9: you know, fancies himself a master negotiator and the chief 243 00:14:02,200 --> 00:14:07,520 Speaker 9: deal maker, and if I'm countries from Britain to Australia, 244 00:14:08,000 --> 00:14:11,200 Speaker 9: I've been looking for ways to try and figure out 245 00:14:11,240 --> 00:14:15,600 Speaker 9: how not to get socked with reciprocal tariffs. India certainly 246 00:14:15,640 --> 00:14:18,000 Speaker 9: has and it made a lot of moves there as well. 247 00:14:18,400 --> 00:14:20,800 Speaker 9: So there are a lot of countries trying to figure 248 00:14:20,800 --> 00:14:22,320 Speaker 9: out how to do this, and they got a very 249 00:14:22,360 --> 00:14:25,400 Speaker 9: clear indication that such a thing as possible. Now how 250 00:14:25,440 --> 00:14:28,360 Speaker 9: that would look, We have no real idea in fact, 251 00:14:28,640 --> 00:14:30,680 Speaker 9: what these tariffs are going to look like at all. 252 00:14:30,800 --> 00:14:33,360 Speaker 9: We don't really have too much of an idea except 253 00:14:33,400 --> 00:14:37,320 Speaker 9: that the initial sort of maximal level of five thousand 254 00:14:37,400 --> 00:14:42,000 Speaker 9: plus individual tariff decisions across all those product lines, multiplied 255 00:14:42,000 --> 00:14:45,960 Speaker 9: by one hundred or more countries and economies, that just 256 00:14:46,000 --> 00:14:49,400 Speaker 9: sort of massive matrix of tariffs is just not going 257 00:14:49,480 --> 00:14:51,320 Speaker 9: to be the way, and it's going to be vastly 258 00:14:51,440 --> 00:14:55,440 Speaker 9: simplified from there. To add carve outs on top of that, 259 00:14:55,800 --> 00:14:59,480 Speaker 9: this is not going to look necessarily as much as 260 00:14:59,480 --> 00:15:03,160 Speaker 9: the Trumpet administration had initially started talking up, even though 261 00:15:03,200 --> 00:15:07,160 Speaker 9: it may wind up in its collectivity being one of 262 00:15:07,200 --> 00:15:10,240 Speaker 9: the largest tariff implementations in a century or more. 263 00:15:11,320 --> 00:15:13,600 Speaker 2: Derek, thank you so much for being with us this morning. 264 00:15:13,640 --> 00:15:16,600 Speaker 2: That is our senior editor, Derek Wallbanks, So taking us through. 265 00:15:17,040 --> 00:15:19,440 Speaker 2: The main stories are from the tomp White House of 266 00:15:19,480 --> 00:15:23,760 Speaker 2: course today on tariffs and also on that major security. 267 00:15:23,240 --> 00:15:24,840 Speaker 1: Breach here in the UK. 268 00:15:24,960 --> 00:15:27,640 Speaker 3: The Bank of England governor says Britain needs a breakthrough 269 00:15:27,760 --> 00:15:30,920 Speaker 3: like artificial intelligence to cancel the collapse and its long 270 00:15:31,000 --> 00:15:34,200 Speaker 3: term growth rate. Andrew Bailey was speaking before the Chancellor's 271 00:15:34,280 --> 00:15:37,520 Speaker 3: Spring statement tomorrow, Rachel Reeves is expected to announce billions 272 00:15:37,520 --> 00:15:40,280 Speaker 3: of pounds and spending cuts report. Two out of bio 273 00:15:40,440 --> 00:15:43,200 Speaker 3: joins us. Now for more TIBA. What did Andrew Bailey 274 00:15:43,240 --> 00:15:44,760 Speaker 3: then have to say about growth? 275 00:15:45,280 --> 00:15:48,080 Speaker 10: Well, in short, he said there's not much of it 276 00:15:48,120 --> 00:15:50,360 Speaker 10: at the moment and that we need to do something 277 00:15:50,400 --> 00:15:52,960 Speaker 10: to buck the trend. So, the Bank of England Governor 278 00:15:53,160 --> 00:15:55,720 Speaker 10: was delivering a lecture at Leicester University and really his 279 00:15:55,880 --> 00:15:58,920 Speaker 10: key message was that the UK needs a growth shake up, 280 00:15:59,040 --> 00:16:02,040 Speaker 10: something that will still mulate it massively to avoid that 281 00:16:02,120 --> 00:16:05,240 Speaker 10: collapse he was speaking about. He talked about the sharp 282 00:16:05,400 --> 00:16:08,360 Speaker 10: slowed down in productivity which he says has actually been 283 00:16:08,360 --> 00:16:12,360 Speaker 10: taking place since even before the financial crisis and resulting 284 00:16:12,400 --> 00:16:15,040 Speaker 10: in a decline in living standards. And it's because of 285 00:16:15,080 --> 00:16:18,760 Speaker 10: this decline that Andrew Bailey wants us to look to technology. 286 00:16:19,200 --> 00:16:22,480 Speaker 10: He gave the example of general purpose technologies like the 287 00:16:22,520 --> 00:16:25,640 Speaker 10: steam engine and the computer, and he says they can 288 00:16:25,720 --> 00:16:28,440 Speaker 10: really move the neasle when it comes to growth in 289 00:16:28,480 --> 00:16:30,680 Speaker 10: the economy. He even went as far as to say 290 00:16:30,720 --> 00:16:34,560 Speaker 10: that the country needs what he's calling a technological breakthrough 291 00:16:34,680 --> 00:16:37,240 Speaker 10: to counter the collapse of its long term growth rate. 292 00:16:37,600 --> 00:16:40,360 Speaker 10: So a real sense of urgency there from Andrew Bailey 293 00:16:40,680 --> 00:16:43,480 Speaker 10: in his eyes, just as inventions like the steam engine 294 00:16:43,760 --> 00:16:47,960 Speaker 10: propelled us during the Industrial Revolution, he thinks AI in 295 00:16:48,040 --> 00:16:52,040 Speaker 10: this instance can be the saving grace, primarily because of 296 00:16:52,160 --> 00:16:57,520 Speaker 10: its ability to enhance productivity, particularly as the population ages, 297 00:16:57,960 --> 00:17:02,040 Speaker 10: and he thinks that the technology is a necessary component 298 00:17:02,160 --> 00:17:04,240 Speaker 10: for growth in hanalies because of this. 299 00:17:04,880 --> 00:17:07,680 Speaker 2: Yeah, I mean that's interesting. A lot of people sort 300 00:17:07,680 --> 00:17:10,480 Speaker 2: of have high hopes for AI. It's about sort of delivery, 301 00:17:10,560 --> 00:17:12,600 Speaker 2: and there's a big risk on the horizon, which is 302 00:17:12,680 --> 00:17:13,480 Speaker 2: trade tariffs. 303 00:17:13,880 --> 00:17:14,560 Speaker 1: Oh yeah, Karrolyn. 304 00:17:14,640 --> 00:17:18,040 Speaker 10: That's the question on everybody's mind, especially as we approach 305 00:17:18,080 --> 00:17:20,600 Speaker 10: what Donald Trump has labeled Liberation Day, and that's on 306 00:17:21,000 --> 00:17:24,359 Speaker 10: April the second, when he slated to reveal tariffs that 307 00:17:24,440 --> 00:17:27,600 Speaker 10: offset levies on US goods. But for his part, Andrew 308 00:17:27,600 --> 00:17:32,000 Speaker 10: Bailey did actually acknowledge what he's identified as large imbalances 309 00:17:32,400 --> 00:17:35,879 Speaker 10: within the trading system, So he actually called out China 310 00:17:36,040 --> 00:17:39,520 Speaker 10: as a country running huge trade surpluses. He didn't go 311 00:17:39,760 --> 00:17:45,080 Speaker 10: quite as far as to endorse President Trump's strategy with tariffs, 312 00:17:45,359 --> 00:17:49,320 Speaker 10: but he did describe those imbalances within the current system 313 00:17:49,760 --> 00:17:53,800 Speaker 10: as the main driver of a high tariff environment. But 314 00:17:53,920 --> 00:17:57,480 Speaker 10: where Bailey does differ from Trump, who of course referred 315 00:17:57,520 --> 00:18:00,160 Speaker 10: to tarifs as the most beautiful word in the dictionary, 316 00:18:00,480 --> 00:18:03,159 Speaker 10: is that he thinks we should look to rebalance that 317 00:18:03,280 --> 00:18:08,640 Speaker 10: system through effective multilateral processes rather than those levees. 318 00:18:09,960 --> 00:18:12,000 Speaker 3: This all happening, of course, ahead of the spring statement 319 00:18:12,240 --> 00:18:15,520 Speaker 3: tomorrow from the Chancellor. The government has repeatedly said that 320 00:18:15,560 --> 00:18:18,919 Speaker 3: growing the economy is its number one priority, So ahead 321 00:18:18,920 --> 00:18:22,320 Speaker 3: of the Spring statement, the financial regulator has announced some 322 00:18:22,400 --> 00:18:25,840 Speaker 3: changes which train just cutting some of the barriers to growth. 323 00:18:26,280 --> 00:18:29,120 Speaker 10: Yeah. So we have had from the Financial Conduct Authority 324 00:18:29,160 --> 00:18:32,840 Speaker 10: today that it's dropping the requirement of finance firms to 325 00:18:32,920 --> 00:18:37,400 Speaker 10: follow more than one hundred pages of now perhaps outdated 326 00:18:37,400 --> 00:18:43,280 Speaker 10: guidance on products such as mortgages and investments. It's something 327 00:18:43,320 --> 00:18:47,040 Speaker 10: that Rachel Reeves has talked about a lot, including during 328 00:18:47,200 --> 00:18:50,400 Speaker 10: her latest interview with Bloomberg last week, where she talked 329 00:18:50,480 --> 00:18:55,159 Speaker 10: about slashing regulatory barriers to growth. And this news comes 330 00:18:55,200 --> 00:18:59,159 Speaker 10: today as the FCA publishes its five year strategy, and 331 00:18:59,200 --> 00:19:04,800 Speaker 10: that's got folks on helping consumers, fighting crime, supporting growth, 332 00:19:04,800 --> 00:19:09,040 Speaker 10: and crucially becoming a smarter regulator. That's according to a 333 00:19:09,080 --> 00:19:11,360 Speaker 10: statement released from the Body today. 334 00:19:13,119 --> 00:19:15,840 Speaker 3: This is Bloomberg Daybreak Europe, your morning brief on the 335 00:19:15,920 --> 00:19:18,960 Speaker 3: stories making news from London to Wall Street and beyond. 336 00:19:19,240 --> 00:19:23,200 Speaker 2: Look for us on your podcast feed every morning on Apple, Spotify, 337 00:19:23,320 --> 00:19:25,280 Speaker 2: and anywhere else you get your podcasts. 338 00:19:25,320 --> 00:19:28,320 Speaker 3: You can also listen live each morning on London Dab Radio, 339 00:19:28,359 --> 00:19:31,080 Speaker 3: the Bloomberg Business app, and Bloomberg dot Com. 340 00:19:31,119 --> 00:19:33,880 Speaker 2: Our flagship New York station is also available on your 341 00:19:33,920 --> 00:19:38,639 Speaker 2: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty. 342 00:19:38,880 --> 00:19:40,920 Speaker 1: I'm Caroline Hepka and I'm Stephen Carroll. 343 00:19:40,960 --> 00:19:43,320 Speaker 3: Join us again tomorrow morning for all the news you 344 00:19:43,400 --> 00:19:46,040 Speaker 3: need to start your day right here on Bloomberg day 345 00:19:46,080 --> 00:19:50,800 Speaker 3: Break Europe.