1
00:00:02,440 --> 00:00:10,520
Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is the Bloomberg

2
00:00:10,600 --> 00:00:13,760
Speaker 1: Day bit Q podcast, available every morning on Apple, Spotify

3
00:00:13,880 --> 00:00:16,239
Speaker 1: or wherever you listen. It's Thursday, the ninth of May

4
00:00:16,239 --> 00:00:18,200
Speaker 1: here in London. I'm Caroline Hepki and.

5
00:00:18,120 --> 00:00:20,640
Speaker 2: I'm Stephen Carroll. Coming up today, the Bank of England

6
00:00:20,680 --> 00:00:23,599
Speaker 2: weighs when to cut interest rates. After the FED pushes

7
00:00:23,680 --> 00:00:25,279
Speaker 2: its move down the road.

8
00:00:25,280 --> 00:00:28,360
Speaker 1: President Biden warns that the US will hold back more

9
00:00:28,400 --> 00:00:30,640
Speaker 1: weapons if Israel invades Raffa.

10
00:00:30,800 --> 00:00:33,680
Speaker 2: Plus, the apple doesn't fall far from the tree. We

11
00:00:33,800 --> 00:00:36,879
Speaker 2: have the inside story on who might one day succeed

12
00:00:36,920 --> 00:00:38,600
Speaker 2: Tim Cook at the Tech Titan.

13
00:00:38,840 --> 00:00:40,920
Speaker 1: Let's start with a roundup of our top stories.

14
00:00:41,640 --> 00:00:44,239
Speaker 2: Markets are poised for a stronger signal on when the

15
00:00:44,280 --> 00:00:48,040
Speaker 2: Bank of England will cut interest rates, although economists expect

16
00:00:48,040 --> 00:00:50,960
Speaker 2: the benchmark rate to stay at five hundred quarter percent.

17
00:00:51,080 --> 00:00:54,920
Speaker 2: Governor Andrew Bailey may provide clearer indications later on when

18
00:00:54,960 --> 00:00:59,120
Speaker 2: he expects to loosen policy. Bloomberg's chief UK economist Dan

19
00:00:59,160 --> 00:01:02,200
Speaker 2: Hansen says more MPC members could be warming to a

20
00:01:02,280 --> 00:01:03,120
Speaker 2: cost for me.

21
00:01:03,160 --> 00:01:05,760
Speaker 3: Actually, what's been most interesting is what policy makers have

22
00:01:05,800 --> 00:01:09,759
Speaker 3: been saying, and we've had remarks from certainly Andrew Bailey

23
00:01:09,760 --> 00:01:13,160
Speaker 3: and Dave Ramsden that are you know, very much sort

24
00:01:13,160 --> 00:01:15,200
Speaker 3: of moving in I would say the duttish direction. There's

25
00:01:15,200 --> 00:01:16,880
Speaker 3: a little bit of uncertainty. I think about what Hugh

26
00:01:16,959 --> 00:01:19,399
Speaker 3: pill did or didn't say in his speech, but I

27
00:01:19,400 --> 00:01:21,520
Speaker 3: think the thing for us that we took away at

28
00:01:21,600 --> 00:01:24,039
Speaker 3: least is that he said that there's been little news

29
00:01:24,360 --> 00:01:27,679
Speaker 3: in the data, which is obviously clearly very important.

30
00:01:28,280 --> 00:01:31,440
Speaker 2: That's Star Hanson from Bloomberg Economics. Policymakers also faced some

31
00:01:31,480 --> 00:01:34,679
Speaker 2: political pressure to lower borrowing costs as government ministers look

32
00:01:34,720 --> 00:01:37,360
Speaker 2: for a feel good factor for voters ahead of an

33
00:01:37,400 --> 00:01:40,360
Speaker 2: election expected later this year. The latest Bank of England

34
00:01:40,360 --> 00:01:42,880
Speaker 2: decision is due at twelve pm UK time, followed by

35
00:01:42,920 --> 00:01:45,759
Speaker 2: a press conference lad by Andrew Bailey, now.

36
00:01:45,640 --> 00:01:48,400
Speaker 1: The former chief economist of the Bank of England, says

37
00:01:48,440 --> 00:01:51,400
Speaker 1: that he was denied a British bank account last year

38
00:01:51,440 --> 00:01:56,640
Speaker 1: because he was designated politically connected. Referring to the debanked

39
00:01:56,720 --> 00:02:02,520
Speaker 1: politician Nigel Farash, Andy Haldane says, we are all nigels now.

40
00:02:02,520 --> 00:02:06,040
Speaker 4: More than one hundred and forty thousand companies have been

41
00:02:06,520 --> 00:02:13,600
Speaker 4: the banked across the UK, including me, so I tried

42
00:02:13,600 --> 00:02:16,040
Speaker 4: to open a bank account last year and the bank

43
00:02:16,120 --> 00:02:18,919
Speaker 4: was very nice, very straightforward process. It came back a

44
00:02:18,919 --> 00:02:22,960
Speaker 4: few weeks later refusing and they said your account's been

45
00:02:22,960 --> 00:02:28,320
Speaker 4: refused because you are politically connected by dint of working

46
00:02:28,400 --> 00:02:29,400
Speaker 4: for the Bank of England.

47
00:02:33,080 --> 00:02:35,799
Speaker 1: Andy Haldane, speaking that the Rules Society of Arts, where

48
00:02:35,840 --> 00:02:39,960
Speaker 1: he's now CEO, how Dane blamed regulation like Barsil three

49
00:02:40,000 --> 00:02:44,760
Speaker 1: and Solvency two for chilling risk appetite and stalling investment.

50
00:02:45,040 --> 00:02:47,440
Speaker 1: He argues the UK needs to take more gambles if

51
00:02:47,440 --> 00:02:51,120
Speaker 1: it wants to boost growth, offering a partial endorsement of

52
00:02:51,240 --> 00:02:55,040
Speaker 1: Shadow Chancellor Rachel Reeves secure nomics policies.

53
00:02:55,880 --> 00:02:59,079
Speaker 2: US President Joe Biden says he will start additional shipments

54
00:02:59,120 --> 00:03:02,280
Speaker 2: of offensive weapons to Israel if the country goes ahead

55
00:03:02,280 --> 00:03:06,079
Speaker 2: with a ground invasion of Raffa in Gaza. The comments

56
00:03:06,120 --> 00:03:08,840
Speaker 2: come as the US pause delivery of about three thousand,

57
00:03:08,960 --> 00:03:12,480
Speaker 2: five hundred bombs to Israel that could cause massive collateral

58
00:03:12,560 --> 00:03:16,520
Speaker 2: damage in the densely packed city. In an interview with CNN,

59
00:03:16,600 --> 00:03:20,000
Speaker 2: Joe Biden sought to highlight the potential loss of civilian

60
00:03:20,040 --> 00:03:24,000
Speaker 2: life if Benjamin Netanyahu's government opts to invade the area.

61
00:03:24,360 --> 00:03:26,680
Speaker 5: If they go on to RAFA. I'm not for applying

62
00:03:26,720 --> 00:03:29,240
Speaker 5: the weapons that have been used historically to deal with

63
00:03:29,320 --> 00:03:32,320
Speaker 5: Rafa to deal with the city, to deal with that problem.

64
00:03:32,320 --> 00:03:34,480
Speaker 5: We're going to continue to make sure as you're as

65
00:03:34,480 --> 00:03:37,520
Speaker 5: secure in terms of iron Dome and their ability to

66
00:03:37,560 --> 00:03:41,320
Speaker 5: respond to attacks like came out of you the least recently.

67
00:03:41,640 --> 00:03:43,880
Speaker 5: But it's just wrong.

68
00:03:45,080 --> 00:03:48,680
Speaker 2: Biden's decision on armed supplies was attacked by Israel, who

69
00:03:48,800 --> 00:03:52,000
Speaker 2: reportedly told US officials that pressure should be put on

70
00:03:52,040 --> 00:03:54,240
Speaker 2: Hamas rather than on their country.

71
00:03:55,280 --> 00:03:59,600
Speaker 1: Shares in the chip designer ARM tumbled after a lukewarm

72
00:03:59,640 --> 00:04:03,640
Speaker 1: four past revenue for fiscal twenty twenty five, it's expected

73
00:04:03,680 --> 00:04:06,320
Speaker 1: to be three point eight billion to four point one

74
00:04:06,360 --> 00:04:10,080
Speaker 1: billion dollars. Now that is just shy of analysts expectations

75
00:04:10,080 --> 00:04:14,000
Speaker 1: of four billion dollars on the lower end. Konshan Sabane

76
00:04:14,080 --> 00:04:17,840
Speaker 1: from Bloemberg Intelligence says the slowdown is sector wide.

77
00:04:18,200 --> 00:04:21,560
Speaker 6: The driver for the mislike miss in the fiscalier guidance

78
00:04:21,640 --> 00:04:24,720
Speaker 6: was coming really from two major areas. One is networking

79
00:04:25,040 --> 00:04:29,080
Speaker 6: and the other is the industrial IoT which most of

80
00:04:29,120 --> 00:04:32,120
Speaker 6: the semiconductor companies exposed to this are seeing weakness here.

81
00:04:32,200 --> 00:04:35,000
Speaker 6: So that's not companies specific. It's just that end market

82
00:04:35,040 --> 00:04:37,800
Speaker 6: is going through a cyclical bottom. There's higher inventories and

83
00:04:37,880 --> 00:04:38,799
Speaker 6: the demand is weak.

84
00:04:39,920 --> 00:04:46,040
Speaker 1: Bloomberg's semiconductor analyst Kunshan Sabani, speaking there. The predictions raised

85
00:04:46,080 --> 00:04:50,359
Speaker 1: concerns that the tech industry's artificial intelligence spending spree is slowing,

86
00:04:50,760 --> 00:04:53,800
Speaker 1: but URM CEO Rene Haas says that the company remains

87
00:04:53,880 --> 00:04:55,839
Speaker 1: very confident in its long term growth.

88
00:04:57,320 --> 00:04:59,880
Speaker 2: London is missing out on a rebound in Europe's ines

89
00:05:00,160 --> 00:05:03,600
Speaker 2: public offering markets. According to new data compiled by Bloomberg,

90
00:05:03,800 --> 00:05:06,920
Speaker 2: of the eleven point nine billion dollars raised in IPOs

91
00:05:06,960 --> 00:05:09,400
Speaker 2: in Europe this year, just over two percent was in

92
00:05:09,440 --> 00:05:12,520
Speaker 2: the UK. That compares to an average share of thirty

93
00:05:12,600 --> 00:05:15,920
Speaker 2: one percent over the past eleven years. With UK stocks

94
00:05:15,920 --> 00:05:18,839
Speaker 2: trading at a disc und to many foreign markets, it

95
00:05:19,000 --> 00:05:21,640
Speaker 2: believes that the London IPO market is being hindered by

96
00:05:21,640 --> 00:05:24,039
Speaker 2: the prospect of higher valuations elsewhere.

97
00:05:24,680 --> 00:05:27,599
Speaker 1: A UK think tank says that Chancellor Jeremy Hunt has

98
00:05:27,720 --> 00:05:31,160
Speaker 1: run out of fiscal room. The National Institute for Economic

99
00:05:31,200 --> 00:05:35,560
Speaker 1: and Social Research says weak growth and sticky inflation mean

100
00:05:35,640 --> 00:05:38,839
Speaker 1: the government will need to raise taxes in the autumn

101
00:05:39,200 --> 00:05:42,640
Speaker 1: rather than cut them. Bloomberg's Tia Adebayo has more.

102
00:05:43,240 --> 00:05:46,239
Speaker 7: There were already question marks about where the tax cuts

103
00:05:46,279 --> 00:05:50,440
Speaker 7: could really restore the Conservative Party's election hopes, but nissas

104
00:05:50,520 --> 00:05:53,760
Speaker 7: say not only can the Chancellor not afford them, government

105
00:05:53,839 --> 00:05:56,719
Speaker 7: deficits are so far into the red zone he will

106
00:05:56,720 --> 00:06:00,240
Speaker 7: need to raise taxes just to balance the books. Their

107
00:06:00,240 --> 00:06:03,719
Speaker 7: advice scrap the fiscal rules entirely and bring in a

108
00:06:03,760 --> 00:06:08,000
Speaker 7: longer term system that allows more public investment. There is

109
00:06:08,160 --> 00:06:12,000
Speaker 7: brighter news in the report. NISA expects a six percent

110
00:06:12,080 --> 00:06:16,320
Speaker 7: surge in living standards this year as inflation moderates in London.

111
00:06:16,400 --> 00:06:18,479
Speaker 7: Do you added by Bimberg Radio.

112
00:06:18,880 --> 00:06:21,159
Speaker 1: Now in a moment we'll look ahead to today's Bank

113
00:06:21,200 --> 00:06:25,040
Speaker 1: of England decision and also speak to Bloomberg's chief correspondent,

114
00:06:25,120 --> 00:06:27,440
Speaker 1: Mark German, staying up very late for us in the

115
00:06:27,560 --> 00:06:31,400
Speaker 1: US to talk about who might succeed Tim Cook at Apple.

116
00:06:32,080 --> 00:06:34,839
Speaker 1: But also I just wanted to reflect for a moment

117
00:06:34,960 --> 00:06:38,320
Speaker 1: on Andy Haldane's speech. I mean, he's a hugely influential

118
00:06:38,360 --> 00:06:40,640
Speaker 1: economist of course here in the UK, and I think

119
00:06:40,640 --> 00:06:43,400
Speaker 1: across Europe as well, former a chief economist at the

120
00:06:43,400 --> 00:06:47,960
Speaker 1: Bank of England, and his speech in talking about everyone

121
00:06:48,000 --> 00:06:50,880
Speaker 1: being a Nigel. Look, this will get pick up right

122
00:06:51,560 --> 00:06:56,479
Speaker 1: in terms of the UK media being debanked, but I

123
00:06:56,520 --> 00:06:59,760
Speaker 1: think that some of his speech was absolutely fascinating. He

124
00:06:59,800 --> 00:07:04,160
Speaker 1: took talked about why stability and stasis is not enough,

125
00:07:04,240 --> 00:07:06,160
Speaker 1: not enough for the UK, all for the world, but

126
00:07:06,320 --> 00:07:09,080
Speaker 1: actually globally we need to take more risks. That there's

127
00:07:09,120 --> 00:07:12,960
Speaker 1: so much anxiety about change it's causing us not to

128
00:07:13,120 --> 00:07:16,720
Speaker 1: change rapidly enough. And this is absolutely I think where

129
00:07:16,720 --> 00:07:19,000
Speaker 1: the conversation is the kind of zeitgeist at the moment.

130
00:07:19,360 --> 00:07:22,000
Speaker 1: He talked about the stagnation in wages in the UK

131
00:07:22,120 --> 00:07:25,200
Speaker 1: over the past fifteen years, but he compared that to

132
00:07:25,240 --> 00:07:28,000
Speaker 1: the United States, where he talked about fifty years of

133
00:07:28,080 --> 00:07:31,720
Speaker 1: wage stagnation. And yet he was also very optimistic. He

134
00:07:31,760 --> 00:07:33,760
Speaker 1: didn't want to be all, you know, dooming gloom. That

135
00:07:33,800 --> 00:07:36,640
Speaker 1: wasn't his term, but he said that he wanted to

136
00:07:36,680 --> 00:07:40,800
Speaker 1: focus on the optimism and where there are opportunities. That

137
00:07:40,840 --> 00:07:45,080
Speaker 1: global trade is still growing, that levels of income around

138
00:07:45,120 --> 00:07:47,760
Speaker 1: the world have never been sort of higher, That people

139
00:07:47,840 --> 00:07:51,600
Speaker 1: are living longer and that is a huge opportunity for

140
00:07:51,680 --> 00:07:53,800
Speaker 1: this century. So there was a lot of kind of

141
00:07:54,080 --> 00:07:55,280
Speaker 1: optimism in his speech.

142
00:07:55,360 --> 00:07:56,960
Speaker 2: Look It's always very interesting to listen to what Andy

143
00:07:57,000 --> 00:07:58,680
Speaker 2: hal Dane has to say, not only because of his

144
00:07:58,720 --> 00:08:01,640
Speaker 2: past position at the Bank up the Bank of England,

145
00:08:01,680 --> 00:08:06,360
Speaker 2: but also his views on where policy goes now as well.

146
00:08:06,200 --> 00:08:08,280
Speaker 2: We had him on the Blueberg gi Ge Poltics podcast

147
00:08:08,280 --> 00:08:10,240
Speaker 2: just a couple of months ago, and i'd point you

148
00:08:10,280 --> 00:08:11,960
Speaker 2: back to that episode as well if you want to

149
00:08:11,960 --> 00:08:13,720
Speaker 2: hear more from Andie hall Danes's views.

150
00:08:13,800 --> 00:08:18,000
Speaker 1: Yeah, absolutely right, let's sign our attention then. Well, remaining

151
00:08:18,080 --> 00:08:20,200
Speaker 1: with the Bank of England, shall we It's expected to

152
00:08:20,480 --> 00:08:22,840
Speaker 1: keep blending rates at five and a quarter percent, but

153
00:08:22,880 --> 00:08:26,960
Speaker 1: the question is whether Governor Andrew Bailey gives strongest signals

154
00:08:27,000 --> 00:08:29,960
Speaker 1: on when the Central Bank are lower those borrowing costs

155
00:08:29,960 --> 00:08:33,360
Speaker 1: from their highest in sixteen years. Joining us now, Jamie Rush,

156
00:08:33,360 --> 00:08:37,320
Speaker 1: our chief European Economists, Good morning, Jamie. The rate path

157
00:08:37,400 --> 00:08:40,640
Speaker 1: and the signals from Andrew Braley. What do you expect?

158
00:08:40,640 --> 00:08:43,600
Speaker 1: What about the potential vote split at the Bank of England.

159
00:08:43,960 --> 00:08:47,079
Speaker 8: Well, as traders are fairly split on whether there's going

160
00:08:47,120 --> 00:08:49,200
Speaker 8: to be a cut in June, and so today could

161
00:08:49,240 --> 00:08:52,160
Speaker 8: well be quite decisive and tilting that pricing one way

162
00:08:52,240 --> 00:08:56,760
Speaker 8: or another. On the vote split and the communications around that.

163
00:08:57,440 --> 00:08:59,240
Speaker 8: I think to see it cut, we're going to need

164
00:08:59,240 --> 00:09:01,400
Speaker 8: a couple to see it cup of things, possibly one

165
00:09:01,400 --> 00:09:04,520
Speaker 8: of the members of the committee deciding to cut, whereas

166
00:09:04,520 --> 00:09:07,520
Speaker 8: previously they've decided they've been on hold. So as you,

167
00:09:07,640 --> 00:09:09,680
Speaker 8: I mean, Dave Ramsen would be a good candidate for

168
00:09:09,720 --> 00:09:12,480
Speaker 8: that because he now sees inflation risks in the UK's

169
00:09:12,520 --> 00:09:14,760
Speaker 8: being to the downside, which is a change of position,

170
00:09:14,960 --> 00:09:17,800
Speaker 8: so we should probably expect him to favor a cut,

171
00:09:18,320 --> 00:09:20,120
Speaker 8: and then we'll also need to see that backed up

172
00:09:20,120 --> 00:09:22,720
Speaker 8: by some dubbish remarks from Bailey. Some of the data

173
00:09:22,760 --> 00:09:25,520
Speaker 8: have been surprisingly strong, like inflation is a little bit

174
00:09:25,800 --> 00:09:29,720
Speaker 8: or services inflation certainly is a little stronger, the economy

175
00:09:29,800 --> 00:09:32,319
Speaker 8: is growing a little faster, So we need to see

176
00:09:32,360 --> 00:09:36,199
Speaker 8: some evidence that they're not panicking as that data has

177
00:09:36,240 --> 00:09:39,480
Speaker 8: come through, and that'll probably be enough. But I mean,

178
00:09:39,480 --> 00:09:41,280
Speaker 8: if we want to a wild card, I mean, they

179
00:09:41,280 --> 00:09:44,320
Speaker 8: could explicitly say that they're minded to ease if the

180
00:09:44,400 --> 00:09:46,720
Speaker 8: data come in and line with their forecast. And we

181
00:09:46,760 --> 00:09:50,679
Speaker 8: don't think they'll do that because they're expressively data dependent,

182
00:09:50,800 --> 00:09:52,520
Speaker 8: but it's a possibility and if they want to send

183
00:09:52,520 --> 00:09:54,439
Speaker 8: a strong message, that's that's how they'll do it.

184
00:09:54,640 --> 00:09:57,880
Speaker 2: What about the forecasts for inflation and growth? What all

185
00:09:57,880 --> 00:09:58,680
Speaker 2: you be watching out for?

186
00:09:59,120 --> 00:10:01,360
Speaker 8: Well, again, I think the in the forecasts are always

187
00:10:01,600 --> 00:10:05,240
Speaker 8: a tool to communicate to markets about whether they're they're

188
00:10:05,280 --> 00:10:09,880
Speaker 8: thinking the same way. So last time they produced a forecast,

189
00:10:09,920 --> 00:10:13,200
Speaker 8: there was one hundred basis points of cuts in the

190
00:10:13,320 --> 00:10:17,360
Speaker 8: in the yield curve and inflation was roughly in line

191
00:10:17,440 --> 00:10:19,600
Speaker 8: with target in the medium term. This time there's only

192
00:10:19,600 --> 00:10:22,280
Speaker 8: fifty basis points of cuts in the in the forecast

193
00:10:22,320 --> 00:10:25,640
Speaker 8: probably and so they'll probably show that inflation is below

194
00:10:25,720 --> 00:10:27,840
Speaker 8: target in the medium term. It's to say that the

195
00:10:27,880 --> 00:10:31,199
Speaker 8: markets are too hawkish and that they should they should

196
00:10:31,280 --> 00:10:31,960
Speaker 8: they should expend.

197
00:10:32,000 --> 00:10:37,200
Speaker 1: We're eating okay? What is in terms of the the

198
00:10:37,280 --> 00:10:40,439
Speaker 1: other stories that we're thinking about. The think tank NISSA

199
00:10:40,559 --> 00:10:44,440
Speaker 1: has weighed in on on tax cuts. I mean there's

200
00:10:44,480 --> 00:10:47,360
Speaker 1: also potentially in the back drop some pressure on the

201
00:10:47,360 --> 00:10:49,240
Speaker 1: Bank Fingland's cut rates. You know, that would be a

202
00:10:49,280 --> 00:10:52,000
Speaker 1: good thing for the government and so on. NISSA, which

203
00:10:52,040 --> 00:10:55,400
Speaker 1: is again a think tank in the UK, they have

204
00:10:55,480 --> 00:10:58,120
Speaker 1: forecasts which are very similar to the model used by

205
00:10:58,120 --> 00:11:00,360
Speaker 1: the Treasury and they show that any pre election give

206
00:11:00,400 --> 00:11:02,880
Speaker 1: away by the chance and in terms of tax cuts

207
00:11:03,160 --> 00:11:05,440
Speaker 1: wouldn't be possible that actually Hunt has to do more

208
00:11:05,480 --> 00:11:07,000
Speaker 1: in terms of balancing the books.

209
00:11:07,360 --> 00:11:10,040
Speaker 8: Well, so I think there's a couple of points on

210
00:11:10,080 --> 00:11:12,200
Speaker 8: this one. I mean, the first is that there wasn't

211
00:11:12,280 --> 00:11:16,559
Speaker 8: rooms to do tax cuts last time, because the only

212
00:11:16,600 --> 00:11:19,080
Speaker 8: way that they're consistent with debt falling at the end

213
00:11:19,120 --> 00:11:22,440
Speaker 8: of the forecast is by penciling and ludicrously tight spending

214
00:11:22,480 --> 00:11:25,920
Speaker 8: settlements for government departments. So there was never any rooms

215
00:11:25,920 --> 00:11:29,920
Speaker 8: to do tax cuts anyway. But if you take them

216
00:11:29,040 --> 00:11:32,360
Speaker 8: at their word that they're going to do these spending cuts,

217
00:11:32,679 --> 00:11:35,400
Speaker 8: then yeah, it's probably it's reasonably likely that they'll have

218
00:11:35,480 --> 00:11:38,160
Speaker 8: less space when it comes to the next fiscal event.

219
00:11:38,559 --> 00:11:42,600
Speaker 8: But what I would say, though, is that spending taxes

220
00:11:42,920 --> 00:11:46,480
Speaker 8: are two huge numbers, and the difference between them can

221
00:11:46,520 --> 00:11:49,360
Speaker 8: be quite can be quite small, or surely these changes

222
00:11:49,360 --> 00:11:52,720
Speaker 8: in those numbers, it's basically impossible to forecast exactly where

223
00:11:52,920 --> 00:11:55,760
Speaker 8: the OBR is going to land. Regardless of which model

224
00:11:55,800 --> 00:11:58,199
Speaker 8: you have, it comes down to what the obr's judgments are.

225
00:11:58,240 --> 00:12:00,600
Speaker 8: As the people who run the OBR, who make decisions

226
00:12:00,640 --> 00:12:03,160
Speaker 8: about how strong the economy is going to be. A

227
00:12:03,240 --> 00:12:06,800
Speaker 8: model can't tell you that so I think there's we

228
00:12:06,800 --> 00:12:09,840
Speaker 8: should prove a skeptical about whether that we're able to

229
00:12:09,840 --> 00:12:13,319
Speaker 8: predict where the guy is going to land in the end.

230
00:12:13,640 --> 00:12:15,640
Speaker 2: Okay, Jamie, thank you so much. I Chief you're of

231
00:12:15,640 --> 00:12:18,280
Speaker 2: economist there from Blooberg Economics. Jamie Rush talking us through

232
00:12:18,920 --> 00:12:20,720
Speaker 2: today's decision from the Bank of England.

233
00:12:21,040 --> 00:12:24,840
Speaker 1: Now, it's a huge tech job and a dilemma who

234
00:12:24,880 --> 00:12:29,520
Speaker 1: will succeed Tim Cook as Apple's next CEO. Bloomberg's Mark

235
00:12:29,520 --> 00:12:32,319
Speaker 1: German has a long piece looking at Cook's tenure and

236
00:12:32,360 --> 00:12:35,840
Speaker 1: the growing questions about who might follow him leading a

237
00:12:35,920 --> 00:12:39,640
Speaker 1: multi trillion dollar company, and it's all in Bloomberg Business Week.

238
00:12:39,720 --> 00:12:42,199
Speaker 1: But Mark joins us now, good morning, Mark, thank you

239
00:12:42,320 --> 00:12:44,720
Speaker 1: so much for staying up so late and speaking to us.

240
00:12:45,080 --> 00:12:48,120
Speaker 1: Apple as a business has quite a lot to grapple

241
00:12:48,160 --> 00:12:48,920
Speaker 1: with right now.

242
00:12:49,280 --> 00:12:52,520
Speaker 9: It's a busy time for Apple. Obviously, you're grappling with

243
00:12:52,840 --> 00:12:56,959
Speaker 9: the ever lasting search for a new innovative product after

244
00:12:57,040 --> 00:13:00,520
Speaker 9: the iPhone. You're grappling with the European Union in the

245
00:13:00,600 --> 00:13:03,120
Speaker 9: United States, with which both want to break up the

246
00:13:03,160 --> 00:13:06,480
Speaker 9: App Store, which by the way, generates twenty billion a

247
00:13:06,559 --> 00:13:10,640
Speaker 9: year in revenue. As smartphone sales are slowing. You're trying

248
00:13:10,640 --> 00:13:14,240
Speaker 9: to pull some of your manufacturing out of China while

249
00:13:14,240 --> 00:13:18,760
Speaker 9: also trying to not upset Beijing. So clearly Tim Cook

250
00:13:19,120 --> 00:13:21,560
Speaker 9: is very busy right now. He's got a lot on

251
00:13:21,600 --> 00:13:25,079
Speaker 9: his plate. But like you said, there are questions about

252
00:13:25,120 --> 00:13:28,280
Speaker 9: succession at Apple, given that Cook is churning sixty five

253
00:13:28,360 --> 00:13:29,000
Speaker 9: next year.

254
00:13:29,559 --> 00:13:33,079
Speaker 2: And he's certainly rich enough to retire. So who could

255
00:13:33,120 --> 00:13:35,520
Speaker 2: be in the running to replace Tim Cook?

256
00:13:36,120 --> 00:13:36,320
Speaker 5: Yeah?

257
00:13:36,400 --> 00:13:39,160
Speaker 9: Cook, of course, like the rest of the Apple's executive team,

258
00:13:39,200 --> 00:13:43,160
Speaker 9: they're all rich and old enough to retire. But money

259
00:13:43,200 --> 00:13:47,000
Speaker 9: isn't necessarily the focus. They appreciate the power, right, They

260
00:13:47,040 --> 00:13:50,400
Speaker 9: appreciate the product work, the business side of it, right.

261
00:13:50,440 --> 00:13:52,360
Speaker 9: So it's not all about the money for them. If

262
00:13:52,400 --> 00:13:55,080
Speaker 9: it was, they would have retired by now. So who

263
00:13:55,120 --> 00:13:57,280
Speaker 9: is next in line? Well, if Tim Cook were to

264
00:13:57,320 --> 00:13:59,920
Speaker 9: step down in the very near future, look no for

265
00:14:00,000 --> 00:14:03,679
Speaker 9: other than Jeff Williams. He's Apple's chief operating Officer. He

266
00:14:03,760 --> 00:14:06,559
Speaker 9: was named that role nine years ago. That was the

267
00:14:06,600 --> 00:14:09,000
Speaker 9: same role that Tim Cook held for many years under

268
00:14:09,000 --> 00:14:12,280
Speaker 9: Steve Jobs. He's in charge of both industrial and user

269
00:14:12,320 --> 00:14:16,080
Speaker 9: interface design at Apple, the company's supply chain and Apple Care,

270
00:14:16,600 --> 00:14:19,400
Speaker 9: and he not only looks like Tim Cook not only

271
00:14:19,440 --> 00:14:21,240
Speaker 9: went to the same school as Tim Cook, and also,

272
00:14:21,320 --> 00:14:24,520
Speaker 9: like Cook, worked at IBM, but he is Cook's number two.

273
00:14:25,000 --> 00:14:26,880
Speaker 9: The other part of it is that he's only two

274
00:14:26,920 --> 00:14:31,000
Speaker 9: years younger than Cook. That's a problem. If Cook steps

275
00:14:31,040 --> 00:14:35,080
Speaker 9: down in five seven years or so, you can't pass

276
00:14:35,120 --> 00:14:38,400
Speaker 9: the baton to Williams. He's going to be pushing sixty seven,

277
00:14:38,520 --> 00:14:41,280
Speaker 9: seventy years old. You can't name a person of that

278
00:14:41,360 --> 00:14:43,760
Speaker 9: age as brilliant and as wise as they may be

279
00:14:44,400 --> 00:14:46,200
Speaker 9: as a CEO and expect them to be in the

280
00:14:46,240 --> 00:14:48,800
Speaker 9: role for fifteen years, like Cook and jobs before him.

281
00:14:49,280 --> 00:14:52,000
Speaker 9: That leaves us with someone else. That's John Turnas, the

282
00:14:52,040 --> 00:14:53,680
Speaker 9: senior VP of hardware Engineering.

283
00:14:54,960 --> 00:14:58,480
Speaker 1: Okay, that's interesting. As you say, I mean that the

284
00:14:58,520 --> 00:15:02,160
Speaker 1: circle around Tim Cook has remained very tight for many years.

285
00:15:02,200 --> 00:15:05,520
Speaker 1: I mean, is it still your view that the succession

286
00:15:05,560 --> 00:15:07,560
Speaker 1: would come internally rather than externally.

287
00:15:08,760 --> 00:15:09,000
Speaker 6: Yeah.

288
00:15:09,040 --> 00:15:12,800
Speaker 9: My strong view is that the succession will happen internally,

289
00:15:13,320 --> 00:15:16,600
Speaker 9: and I do strongly believe that John Turnas, like I said,

290
00:15:16,640 --> 00:15:19,800
Speaker 9: the head of hardware Engineering, is the next person up

291
00:15:20,080 --> 00:15:24,360
Speaker 9: to be the CEO of Apple. He's about forty eight

292
00:15:24,440 --> 00:15:27,680
Speaker 9: forty nine years old, which means He's about fifteen young

293
00:15:27,840 --> 00:15:31,000
Speaker 9: years younger than Cook. If Cook steps down in the

294
00:15:31,040 --> 00:15:34,680
Speaker 9: next five years or so, that will leave pretty long

295
00:15:34,760 --> 00:15:38,040
Speaker 9: runway for Turnis to imprint his image on the company.

296
00:15:38,520 --> 00:15:40,960
Speaker 9: He comes from the hardware engineering side, so that would

297
00:15:41,000 --> 00:15:44,640
Speaker 9: be unique and new for the company the previous CEO. Obviously,

298
00:15:44,680 --> 00:15:49,360
Speaker 9: Cook is an operations focused executive and Turnis's biggest challenge

299
00:15:49,440 --> 00:15:51,720
Speaker 9: because I think Cook will deal with the smartphone and

300
00:15:51,760 --> 00:15:55,680
Speaker 9: the China issues and the regulatory matters before his tenures over,

301
00:15:56,080 --> 00:15:58,560
Speaker 9: We'll be finding that next big product category for the

302
00:15:58,600 --> 00:16:01,400
Speaker 9: company and to have a hardware person do that.

303
00:16:03,160 --> 00:16:05,920
Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the

304
00:16:05,960 --> 00:16:09,040
Speaker 2: stories making news from London to Wall Street and beyond.

305
00:16:09,320 --> 00:16:12,480
Speaker 1: Look for us on your podcast feed every morning, on Apple,

306
00:16:12,640 --> 00:16:15,320
Speaker 1: Spotify and anywhere else you get your podcasts.

307
00:16:15,360 --> 00:16:18,400
Speaker 2: You can also listen live each morning on London DAB Radio,

308
00:16:18,440 --> 00:16:21,160
Speaker 2: the Bloomberg Business app, and Bloomberg dot Com.

309
00:16:21,160 --> 00:16:23,960
Speaker 1: Our flagship New York station is also available on your

310
00:16:23,960 --> 00:16:28,680
Speaker 1: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.

311
00:16:28,920 --> 00:16:30,320
Speaker 1: I'm Caroline Hepka.

312
00:16:30,080 --> 00:16:32,520
Speaker 2: And I'm Stephen Carroll. Join us again tomorrow morning for

313
00:16:32,640 --> 00:16:35,040
Speaker 2: all the news you need to start your day right

314
00:16:35,040 --> 00:16:40,840
Speaker 2: here on Bloomberg day Break. Europe