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Speaker 1: Good morning. It's Monday, the seventh of August here in London.

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Speaker 1: This is the Bloomberg Daybreak You at podcast that I'm Caroline.

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Speaker 2: Hepka and I'm Stephen Carroll coming up today. A leading

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Speaker 2: HSBC executive says the UK is weak for siding with

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Speaker 2: the United States against China.

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Speaker 1: Israel's Prime Minister Benjamin Lettigna, who tells Bloomberg he won't

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Speaker 1: pursue his planned judicial overhaul in full.

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Speaker 2: And Elon Musk says a potential cage fight with Mark

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Speaker 2: Zuckerberg will be streamed on his social media site X.

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Speaker 1: Let's start with a roundup of our top stories.

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Speaker 2: A senior executive at HSBC has criticized the United States

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Speaker 2: for strong arming the UK into cutting back business dealings

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Speaker 2: with China. Bloomberg's Crispitt has the details.

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Speaker 3: HSBC's head of public Affairs says the British government is

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Speaker 3: being weak for siding with the US against China. Sred

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Speaker 3: Cooper Coles was speaking at a closed door event in

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Speaker 3: London earlier this summer when he accused the British government

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Speaker 3: of often bowing to demands from Washington. The former British

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Speaker 3: diplomat who is chairman of the China British Business Council

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Speaker 3: lobby group, said the UK should not blindly follow the

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Speaker 3: US but look after its own interests. According to reports,

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Speaker 3: Guests were taken aback by his candor. In a statement

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Speaker 3: of Bloomberg News, Cooper Coles said that his personal comments

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Speaker 3: don't reflect the views of HSBC or the CBBC in London.

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Speaker 3: I'm Chris Pitt Bloomberg Daybreak Europe.

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Speaker 1: Israel's Prime Minister Benjamin Letnia, who has told Bloomberg that

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Speaker 1: he won't pursue the full judicial overhaul that he first planned,

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Speaker 1: working only to change the makeup of the judge selection committee.

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Speaker 1: Speaking exclusively to our editor at large, Francin Laqua, he

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Speaker 1: dismissed concerns that democracy is under threat in the country.

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Speaker 4: I don't think we should move from one extreme where

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Speaker 4: we have perhaps the most activist judicial court and the planet,

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Speaker 4: to get into a point where the legislature or can

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Speaker 4: just knock out any decision that the court makes. There

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Speaker 4: has to be a balance, that's what we're trying to restore.

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Speaker 1: Netnyah, who also defended the Israeli Central Banks independents and

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Speaker 1: praised the government, but said that he has yet to

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Speaker 1: decide if he'll ask emilia On to stay on. Will

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Speaker 1: bring you more of that interview in a few minutes time.

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Speaker 2: Britain's right hot labor market may be cooling as recruiters

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Speaker 2: report a rise in people looking for work. The Recruitment

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Speaker 2: and Employment Confederations says staff of availability is now as

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Speaker 2: high as it was in the wake of the global

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Speaker 2: financial crisis. They add that employers demand for permanent positions

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Speaker 2: is now at its lowest level in almost three years.

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Speaker 2: The new data points to a general slowdown in the

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Speaker 2: UK economy, something the Bank of England says is necessary

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Speaker 2: in order to reduce inflation.

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Speaker 1: The scope of the Ukraine War continues to expand after

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Speaker 1: a weekend in which sea drones crippled a Russian naval

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Speaker 1: vessel and oil tanker. The attacks put Russia's commodity exports

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Speaker 1: at risk, with most of its grain and up to

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Speaker 1: twenty percent of its oil going via the Black Sea route.

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Speaker 1: Louise Jones is the head of intelligence at Mackenzie Intelligence Services.

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Speaker 1: She says the latest attacks follow a pattern of escalation

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Speaker 1: by both sides.

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Speaker 5: This time actually they've targeted a commercial tanker. It is

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Speaker 5: on a sanctions list. It's got ties to the Russian state.

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Speaker 5: It's not just any tanker that they've targeted, but nonetheless

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Speaker 5: it is a commercial vehicle.

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Speaker 1: Louise Jones' comments come as Russia continues to launch missiles

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Speaker 1: at Ukrainian ports following Putin's withdrawal from a grain deal

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Speaker 1: between the two sides. Ukraine's grain exports have been severely

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Speaker 1: reduced as a result, while Russia's have been unaffected.

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Speaker 2: More than one hundred billion dollars has been wiped off

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Speaker 2: the value of companies targeted by Hindenburg Research over the

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Speaker 2: past year. However, calculations from Bloomberg suggest the short seller

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Speaker 2: hasn't been able to fully capitalize. In the case of

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Speaker 2: Ican enterprises, are reporting found a seven ten billion dollar

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Speaker 2: dropping the value of the firm is likely to have

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Speaker 2: netted a profit of just fifty six million dollars. Other

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Speaker 2: Wall Street players say Hindenburg Taxics are high risk, with

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Speaker 2: the firms they target vigorously denying the claims made against them.

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Speaker 1: And finally, Elon Musk is trying to keep the idea

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Speaker 1: of a cage fight with Mark Zuckerberg alive. Bloomberg's Ed

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Speaker 1: Baxter has the story.

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Speaker 6: As the business competition grows with metas threads and Musk's x.

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Speaker 6: Musk has posted that the fight will be streamed on X.

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Speaker 6: So the question which seem to be is Musk just

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Speaker 6: social media trolling again or as he heard more from Zuckerberg,

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Speaker 6: who had earlier responded for mus to let him know

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Speaker 6: where and when. Zuckerberg is a martial arts enthusiast who's

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Speaker 6: participated this year in competition, and Musk says he has

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Speaker 6: been lifting weights throughout the day in preparation. Does this

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Speaker 6: just sound like WWE for techies in San Francisco. I'm

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Speaker 6: at Baxter Bloomberg day Break Europe.

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Speaker 1: Meanwhile, just hours after talking up the fight with Zuckerberg,

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Speaker 1: Musk revealed that he's having an MRI of his neck

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Speaker 1: and up a back today and he may require surgery.

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Speaker 2: Right, well, those are our top stories in the program

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Speaker 2: this morning. I think I've done the right thing to

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Speaker 2: add on Elil must today. But I think in the

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Speaker 2: proces of getting ready for this program, every day Caroline

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Speaker 2: and I try to look around and see what other

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Speaker 2: stories that are catching our eye. And I think this

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Speaker 2: morning is a good illustration of the differences between us, Caroline,

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Speaker 2: because I have been absolutely fascinated by a story about

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Speaker 2: a card game in China, a guandong poker. It roughly

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Speaker 2: translates as throwing eggs. And we have a great piece

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Speaker 2: of reporting about how the the somewhat obscure game is

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Speaker 2: now spreading as a way of sort of being accessory

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Speaker 2: to business negotiations. It's sort of a way of the

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Speaker 2: people who be it, bankers, business people, government officials informally

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Speaker 2: socialize around negotiations they have around various deals. All the

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Speaker 2: more important as heavily indebted local governments in China cutting

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Speaker 2: back on financial incentives, the negotiations are getting trickier and

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Speaker 2: trickier when it comes to how they get deals done.

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Speaker 2: So the card game playing an important social function and

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Speaker 2: how those negotiations are conducted. And you found Caroline nuclear fusion.

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Speaker 1: Of course, that we hack the progress that the Americans

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Speaker 1: have made in getting to the point of, you know,

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Speaker 1: supposedly limitless energy for the world. I feel no brain.

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Speaker 2: Story could change the world, whereas mine, I'm wondering learn

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Speaker 2: how to play this game.

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Speaker 1: Yeah, look, I think I do think it's very interesting.

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Speaker 1: I also think that the contrast is surely with the

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Speaker 1: Elon Musk story that in China. We have nice photographs

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Speaker 1: of a lot of business people, you know, playing playing

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Speaker 1: very civilized card games. And then yeah, the contrast with

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Speaker 1: the possible cage fighter also kind of have we chuckle

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Speaker 1: this morning very different.

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Speaker 2: Well, let's bring you more now. As promised of our

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Speaker 2: interview with Israel's Prime Minister Benjamin Netanya, who's been speaking

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Speaker 2: exclusively to Bloomberg's Francine Laqua. In their wide raging conversation,

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Speaker 2: the prime Minister conceded that he will no longer pursue

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Speaker 2: the entire judicial overhaul that was originally planned by his government.

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Speaker 2: Take a listen, I do that interview.

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Speaker 4: I've stopped the judicial legislation for three months, seeking consensus

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Speaker 4: from the other side, unfortunately not getting it. Then brought

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Speaker 4: in a relatively minor part of the reform, passed it,

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Speaker 4: and then said I'm still going to give it several

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Speaker 4: months to try to get another consensus. What is it?

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Speaker 4: It would probably be about the composition of the committee

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Speaker 4: that elects judges.

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Speaker 7: With the selection of the judges, how they're.

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Speaker 4: Selected, right, That's basically what's left. And because other things

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Speaker 4: I think we should not legislate. I don't think we

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Speaker 4: should move from one extreme where we have perhaps the

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Speaker 4: most activist judicial court and the planet to get into

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Speaker 4: a point where the legislature are conessed can just knock

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Speaker 4: out any decision that the court makes. There has to

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Speaker 4: be a balance. That's what we're trying to restore.

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Speaker 8: So Prime Minister, when you look at the changes election

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Speaker 8: for the judges, how quickly could that come?

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Speaker 4: Well, if we get a compromise, it could come immediately.

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Speaker 4: If we can't get a buy in from the opposition

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Speaker 4: in the Parliament, there's always a buying from the public.

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Speaker 4: What is the thing that the public accepts? And I'm

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Speaker 4: giving it my best shot. I'm spending I wouldn't say

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Speaker 4: twenty four hours a day on it, Let's say about

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Speaker 4: twelve hours a day.

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Speaker 7: And if the public is not behind it, what do

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Speaker 7: you do?

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Speaker 4: I think you should choose something. I think you should

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Speaker 4: choose something that has broad.

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Speaker 7: Acceptance, which looks like one which.

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Speaker 4: Looks like something that I'd like to negotiate, not not

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Speaker 4: even on Bloomberg.

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Speaker 8: Okay, but give me a flavor of is it walking

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Speaker 8: back some of some of the things that have been

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Speaker 8: said by start I.

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Speaker 4: Think ministers can say anything. I don't control words in

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Speaker 4: our parliamentary system. I control deeds and that has to

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Speaker 4: be understood. But since you know the European system, you

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Speaker 4: know that unlike a presidential system, you don't control the

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Speaker 4: you know what is said by members of your cabinet,

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Speaker 4: but you.

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Speaker 8: Can ask them to tone it down. Have you asked

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Speaker 8: them to tone it down one hundred times and they're listening?

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Speaker 4: I succeeded fifty times, and you can always succeed. You

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Speaker 4: don't always succeed. But that's what's important to understand is

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Speaker 4: what is when the dust settles. Are we going to

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Speaker 4: have Israel that is more, is stronger democratically or is

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Speaker 4: it weaker democratically? Is it something where you're going to

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Speaker 4: have the balance that you need between the will of

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Speaker 4: the majority and the rights of the minority or individual rights.

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Speaker 4: Has that been strengthened that balance or has it been weakened.

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Speaker 4: I maintained it'll be strengthened. It certainly will not be

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Speaker 4: correct premise.

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Speaker 8: So there are a lot of questions, especially from investors,

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Speaker 8: especially from businesses, because you always need a body that

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Speaker 8: makes sure that anything that the government passes is legal,

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Speaker 8: and there's maybe a perception problem. But this is weakened

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Speaker 8: so what is the message to business investors and to

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Speaker 8: markets right now?

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Speaker 4: I don't think it's weakened. I think the ultimate actually,

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Speaker 4: I think the ultimate regulator of the democracies are not courts,

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Speaker 4: but are the public choice. I think that's a fundamental

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Speaker 4: misconception of our democracy's work.

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Speaker 7: We always need someone to overlook them.

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Speaker 4: But if you have a louser government, then they're not

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Speaker 4: re elected. That's the most important thing. The most important

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Speaker 4: regulator is the political markets. But I don't think that

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Speaker 4: we should in any way weaken the courts. There's a

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Speaker 4: difference between between an independent court and an all powerful court,

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Speaker 4: and I think what we're trying to do is bring

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Speaker 4: back to Israel where it was in its first fifty years,

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Speaker 4: where there was an adequate balance between the courts, the legislature,

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Speaker 4: and the executive Prime minister.

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Speaker 8: There's a perception problem, maybe if that's what you think,

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Speaker 8: but there's certainly a division in this country, with hundreds

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Speaker 8: of thousands of people protesting and market participants worried about

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Speaker 8: what happens next.

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Speaker 7: What's your message to them?

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Speaker 4: When the Dost settles, Israel will not only will remain

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Speaker 4: a democracy, will be even a stronger democracy but more importantly,

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Speaker 4: it will not in any way impair the enormous business

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Speaker 4: and economic capabilities of Israel in the new technological age.

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Speaker 7: But premiseter, when does this dost settle it?

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Speaker 8: So far you haven't even been prepared to say that

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Speaker 8: you will follow what the Supreme Court decides.

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Speaker 4: Now, we follow what the Supreme Court decides on. The

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Speaker 4: Supreme Court so far has also followed the basic rule

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Speaker 4: of not not stracking down basic laws, which they themselves

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Speaker 4: dean are the basis of the constitution. Both things have

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Speaker 4: to be maintained.

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Speaker 8: So would you tell markets and investors today that whatever

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Speaker 8: they decide right there's something big that's going to be

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Speaker 8: decided in the next couple of months, you will abide

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Speaker 8: by that.

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Speaker 4: I hope that we don't get into a constitutional crisis.

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Speaker 4: I think we won't. I think there's a way of

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Speaker 4: reaching an equitable compromise, which is what I'm trying to do.

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Speaker 2: Now.

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Speaker 4: If I reveal to you everything that I'm trying to do,

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Speaker 4: I won't be able to do it.

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Speaker 8: But the market wants to understand that there's nothing worse

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Speaker 8: for the markets for investors to actually be in the

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Speaker 8: limbu where you're not sure exactly what will happen or

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Speaker 8: how the government will react.

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Speaker 4: Absolutely by the ruling. I'm absolutely sure that is all

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Speaker 4: will come out stable and successful and democratic, at least

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Speaker 4: as democratic, in my view, more democratic. I don't think

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Speaker 4: we're going to turn the country apart. I don't think

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Speaker 4: you're going to have civil war. I think right now

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Speaker 4: what you're seeing is the natural conflict between two opposing

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Speaker 4: views that have not yet meshed, but they will mish.

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Speaker 2: And if you want to hear that full and exclusive

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Speaker 2: conversation between Israel's Prime Minister Benjamin Estnia Who and Bloomberg's

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Speaker 2: Francin and Lacuary, you can download it now on the

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Speaker 2: Bloomberg Talks podcast. All our best interviews in one place.

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Speaker 2: Up next to the high price of ceasing business in Russia.

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Speaker 2: And James Bond faces a new threat, this time to

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Speaker 2: his job. Now the paper review on blue Bird Daybreak

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Speaker 2: Europe The news you need to know from today's papers.

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Speaker 1: Billy Magsley and Goans joined this this morning to look

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Speaker 1: through the newspapers. Let's start with the Financial Times headline

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Speaker 1: European companies suffer one hundred billion euro hit from Russia operations.

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Speaker 1: Good morning, Caroline, Good morning to you.

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Speaker 9: Yes, so, the newspaper leads on a report that Europe's

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Speaker 9: biggest companies have suffered at least one hundred billion euros

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Speaker 9: in direct losses and this is from the sale, closure

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Speaker 9: or reduction of Russian businesses since the start of the

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Speaker 9: war in Ukraine. Now a total of one hundred and

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Speaker 9: seventy six companies recorded losses and this is according to

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Speaker 9: analysis of six hundred European companies yearly reports and twenty

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Speaker 9: twenty three financial statements. The FT have gone in and

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Speaker 9: done the analysis on this figures. This is what they've

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Speaker 9: come up with, but they say that figure does not

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Speaker 9: include the wars indirect to macro economic impacts, and that's

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Speaker 9: such as higher energy prices and commodity costs. Oil and

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Speaker 9: gas companies have actually suffered the heaviest costs of withdrawal

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Speaker 9: from Russia, where three companies alone that's BP, Shell and

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Speaker 9: Total Eners reported combined chargers of around forty billion euros.

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Speaker 9: That's a huge sum of money, but those losses were

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Speaker 9: actually far outweighed by the higher oil and gas prices

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Speaker 9: that we've seen and according to data compiled by the

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Speaker 9: Key School of Economics, more than half of the one thousand,

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Speaker 9: eight hundred and seventy one European owned companies are actually

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Speaker 9: still operating in Russia. They include Italy's UniCredit, Switzerland's Nesslan,

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Speaker 9: and also Unilever, which is part of the UK. But

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Speaker 9: Caroline and Stephen today Bloomberger's reporting about Ukraine's drone attacks

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Speaker 9: on shipping, which is really putting pressure on Russia's commodity exports.

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Speaker 9: They are now at risk given most of its grain

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Speaker 9: and up to twenty percent of its oil go via

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Speaker 9: the Black Sea route.

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Speaker 7: So this is not the end of the story as

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Speaker 7: we know, Lee, Let's.

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Speaker 2: Go to the Telegraph. Next the headline there, James Barnes's

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Speaker 2: job safe, as gc HQ scientist says AI can only

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Speaker 2: do extremely junior spying.

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Speaker 9: Yes, exactly, so James Bond and as colleagues have little

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Speaker 9: to fear from the rise of machines. Apparently, chatbots such

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Speaker 9: as chat GBT are actually not good enough to be

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Speaker 9: intelligence anlest but are only good enough to replace extremely

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Speaker 9: junior agents. Now this is according to a paper that's

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Speaker 9: been written by the chief data scientists at GCHQ. So

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Speaker 9: all good news when it comes to James Bond, because

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Speaker 9: he's very obviously high up in the spying world, so

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Speaker 9: that can't be replicated. But maybe the juniors will be

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Speaker 9: stressing a little bit because the chatbox can replace them.

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Speaker 9: But very interesting really, because a debate about what jobs

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Speaker 9: are going to be lost to AI seems to be

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Speaker 9: very current at the moment.

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Speaker 2: This is Bloomberg Daybreak Europe, your morning brief on the

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Speaker 2: stories making news from London to Wall Street and beyond.

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Speaker 1: Look for us on your podcast feed every morning, on

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Speaker 1: Apple's Spot and anywhere else you get your podcasts.

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Speaker 2: You can also listen live each morning on London DAB Radio,

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Speaker 2: the Bloomberg Business app, and Bloomberg dot Com.

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Speaker 1: Our flagship New York station, is also available on your

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Speaker 1: Amazon Alexa devices. Just say Alexa play Bloomberg eleven thirty.

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Speaker 1: I'm Caroline Hepka and.

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Speaker 2: I'm Stephen Carroll. Join us again tomorrow morning for all

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Speaker 2: the news you need to start your day right here

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Speaker 2: on Bloomberg Daybreak Europe.