WEBVTT - No Nickel Costs Trafigura More Than A Dime

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<v Speaker 1>This is Bloomberg Daybreak. Heure for this Friday, the tenth

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<v Speaker 1>of February in London. Coming up today, no nickel and

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<v Speaker 1>more than a dime metal fraud leaves traffic euro facing

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<v Speaker 1>half a billion dollar lass, the pound in your pocket,

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<v Speaker 1>public sector pay rises makesbur inflation, says the Bank of England.

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<v Speaker 1>I was on a lamb was one stratagist bets the

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<v Speaker 1>FED funds rate will hit eight percent. The Margaret remains

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<v Speaker 1>convinced it's close to five. Britain's two billion pounds fraud

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<v Speaker 1>bills bags can't be copied in cyberspace and Sam, are

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<v Speaker 1>you there? The final hours of FTX. Those other stories

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<v Speaker 1>we're looking at in today's papers are nine Leanne Gern's

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<v Speaker 1>plus a multi billion pound of football pitch. Jim Ratcliffe

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<v Speaker 1>lines up golden sacks to bank roll his Manchester United bid.

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<v Speaker 1>That's all straight ahead on Bloomberg Daybreak Europe. The business

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<v Speaker 1>news you need to start your day in just one

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<v Speaker 1>fifteen minute podcast on Apple, Spotify, the blue Book, Business

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<v Speaker 1>Appen and everywhere you get your podcasts. Good morning, I'm

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<v Speaker 1>Stephen Carroll and I'm Caroline Hike. Here are the stories

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<v Speaker 1>that we're following Today, traffic Eura is facing a five

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<v Speaker 1>and seventy seven million dollar loss after discovering metal cargoes

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<v Speaker 1>that bought didn't contain the nickel they were supposed to.

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<v Speaker 1>The commodity trader says it has spent the past two

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<v Speaker 1>months uncovering what it believes is a systematic fraud against

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<v Speaker 1>the company. Bloomberg's Sukinan broke down how Trafficura found out

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<v Speaker 1>it had been duped. Traffic Our began reviewing its relationships

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<v Speaker 1>with various trading partners late last year. It's apparently been

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<v Speaker 1>buying nickel in containers that are already on board ships,

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<v Speaker 1>and then it sells it when the vessels reached their destination.

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<v Speaker 1>The trade began to unravel when the company's investigators arrived

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<v Speaker 1>at a port in Rotterdam. They checked the contents of

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<v Speaker 1>the container and guess what, no nickel inside? It was

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<v Speaker 1>some other worthless metal, Szukeenan reporting there. The revel another

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<v Speaker 1>black mark for the metals trading industry, which in recent

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<v Speaker 1>years has been beset by tales of fake warehouse receipts,

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<v Speaker 1>duplicate shipping documents, and even containers filled with painted rocks. Now,

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<v Speaker 1>thousands of AID workers are pouring into Turkey and Syria,

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<v Speaker 1>where deaths from Monday's massive earthquakes have now risen past

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<v Speaker 1>twenty thou people. Prime Minister Rishi soonac Here is urging

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<v Speaker 1>everyone to donate what they can to support those in need.

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<v Speaker 1>We will do everything that we can to help Turkey.

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<v Speaker 1>I already said that to the President when I spoke

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<v Speaker 1>to him a couple of days ago, and what the

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<v Speaker 1>government's also said is that we will match all of

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<v Speaker 1>the country's donations pound for pound. Soon I spoke as

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<v Speaker 1>the first un AID shipment arrived in Syria loaded with blankets,

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<v Speaker 1>hygiene products and materials to give people temporary shelter. Meanwhile,

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<v Speaker 1>the World Bank will provide Turkey with nearly one point

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<v Speaker 1>eight billion dollars for disaster relief and recovery. The Bank

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<v Speaker 1>of England Governor Andrew Bailey says big increases in public

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<v Speaker 1>sector pay will add to inflate and if they aren't

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<v Speaker 1>offset by tax increases. Speaking to the Treasury Committee in Parliament,

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<v Speaker 1>Bailey said that even with falling energy costs, inflationary risks remain.

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<v Speaker 1>If you've got those powerful sort of downside forces, why

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<v Speaker 1>are you raising interest rates again? And the answer for

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<v Speaker 1>me to that question is, I'm very uncertain, particularly about

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<v Speaker 1>price setting and wage setting in this country. We have

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<v Speaker 1>got the largest upside skew on and our forecast that

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<v Speaker 1>we've ever had on inflation. Bank Ofving governor is speaking

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<v Speaker 1>as firefighters called off the threat of strikes after receiving

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<v Speaker 1>an improved pay offer. The Fire Brigades union send its

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<v Speaker 1>members would vote on a seven percent raised back dated

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<v Speaker 1>to last summer, and a further five percent increase from

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<v Speaker 1>this July. Now. China's consumer inflation accelerated last month as

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<v Speaker 1>the lunar New Year holiday stimulated demands. Bulloomberg's Brian Curtis

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<v Speaker 1>has more now From Hong Kong, the CPI rose two

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<v Speaker 1>point one percent from a year earlier. That was in

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<v Speaker 1>line of estimates. Core inflation, stripping out food and energy,

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<v Speaker 1>gained just one percent. In the meantime, the pp I

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<v Speaker 1>fill zero point eight percent as commodity prices lagged. The

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<v Speaker 1>estimate was for a drop of zero point five percent.

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<v Speaker 1>Bloomberg Economics says the pickup in cp I was down

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<v Speaker 1>to higher food prices, not services. As such, the signal

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<v Speaker 1>is underwhelming in Hong Kong, Brain Curtis Bloomberg Daybreak Europe.

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<v Speaker 1>British billionaire Jim Ratcliffe is said to have lined up

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<v Speaker 1>banks including Goldman Sacks, to bankroll a bid to buy

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<v Speaker 1>Manchester United. The source says the banks are prepared to

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<v Speaker 1>fund a takeover offer for the English football club with

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<v Speaker 1>bonds and loans. Bloomberg understands this would include covering Manus

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<v Speaker 1>existing eight hundred million dollars of debt. Shares in the

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<v Speaker 1>company starts this week. On reports, Qutari investors are also

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<v Speaker 1>looking to bid for the clubs that as the latest

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<v Speaker 1>on man United and the potential takeover bid their interesting

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<v Speaker 1>stuff on a day where here at home we saw

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<v Speaker 1>tst he has another record high. Yeah absolutely, this was

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<v Speaker 1>results from astro Zenica Standard charted the help to lift

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<v Speaker 1>share prices in London. I mean the one was an

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<v Speaker 1>our performer losses is quite interesting that it's continuing to

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<v Speaker 1>power higher today, But that's not top of my list

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<v Speaker 1>I think today in terms of the most interesting stories.

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<v Speaker 1>It's a Friday, after all, This one has my attention.

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<v Speaker 1>Um Lux walls, net zero glass. This is all about

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<v Speaker 1>how heat is we know escapes from people's homes through windows.

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<v Speaker 1>Bill Gates is making an investment into this business. I mean,

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<v Speaker 1>look at prominting, what what what? Windows? Are we talking

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<v Speaker 1>about it? But it's known for his success with windows.

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<v Speaker 1>Is now investing in a different kind of windows. As

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<v Speaker 1>one of our our office wags equipped earlier, doesn't mean

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<v Speaker 1>we'll have to upgrade it every year. Ah Yes, very

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<v Speaker 1>funny butt of heat basically from buildings escapes through windows.

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<v Speaker 1>So yeah, really interesting that the billionaire is putting money

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<v Speaker 1>into that. And the other one weekend reads that I like,

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<v Speaker 1>so we know that kind of staying trim can perhaps

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<v Speaker 1>and make you live longer. But now that Columbia University

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<v Speaker 1>is doing a two year long study cutting calories by

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<v Speaker 1>apparently slows aging. So there we are. And it depends

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<v Speaker 1>on where you start from. I would imagine, yes, perhaps

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<v Speaker 1>I think perhaps if you're a normal way, but yeah, anyway,

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<v Speaker 1>if you're slimmer, you get to live longer. I will

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<v Speaker 1>retain judge, reserve judgment on that one. Okay, up next,

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<v Speaker 1>Britain's two billion pounds fraud bill Rams bags can't be

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<v Speaker 1>copied in cyberspace? And Sam are you there? The final

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<v Speaker 1>hours of ft X now the paper review on blue

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<v Speaker 1>Bird Daybreak Europe. The news you need to know from

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<v Speaker 1>today's papers. Go into is here for the newspaper review

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<v Speaker 1>this morning. The headline in the Telegraph reads Britain forced

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<v Speaker 1>to pay Brussels two point three billion pounds over import fraud.

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<v Speaker 1>What's going on? Yes, indeed, Caroline, and good morning to you.

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<v Speaker 1>Just one quick thing. Apparently if you're in a relationship

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<v Speaker 1>you also live longer too, so not just cutting calories.

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<v Speaker 1>So there we are lots of studies all around. But

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<v Speaker 1>let's get back to the story. Actually that's in the

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<v Speaker 1>Telegraph today, Caroline, and the government has paid this huge

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<v Speaker 1>sum of two point three billion pounds to the EU.

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<v Speaker 1>Now this comes after a court rule that Britain had

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<v Speaker 1>actually failed to collect billions as a result of fraud

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<v Speaker 1>on imports, and these came in from China. The newspaper says.

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<v Speaker 1>The European Commission did complain that importers into Britain had

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<v Speaker 1>really escaped a number of customs duties and this has

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<v Speaker 1>all to do with false invoices and artificially low value

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<v Speaker 1>documents for things like Chinese textiles and also footwear. The

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<v Speaker 1>European Court of Justice ruled against the UK, saying it

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<v Speaker 1>had failed to adopt the measures necessary to combat import

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<v Speaker 1>fraud and this is between the years twenty eleven and

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<v Speaker 1>twenty seventeen. And remember at this time Britain was still

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<v Speaker 1>a member of the EU. John Glenn, the Chief Secretary

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<v Speaker 1>to the Treasury, said Britain had maintained that it had

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<v Speaker 1>taken appropriate steps to counter forward throughout the legal proceedings

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<v Speaker 1>that were ongoing. However, he also said the UK has

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<v Speaker 1>increased its measures to prevent a fraud going forward. So

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<v Speaker 1>there we are. We see the battle between the EU

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<v Speaker 1>and the UK government. I mean, it's interesting because it

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<v Speaker 1>was such a huge case. I mean it's more than

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<v Speaker 1>half of all textiles and footwear actually imported into the

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<v Speaker 1>UK from China were below the kind of acceptable levels

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<v Speaker 1>that that that they were meant to be according to Europe.

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<v Speaker 1>But yeah, it was. It was huge affected a lot

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<v Speaker 1>of imports into Britain. Thanks le leantoone to a story

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<v Speaker 1>next which maybe one of the most twenty three stories

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<v Speaker 1>that I can imagine at the Times headline Erma's bags

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<v Speaker 1>wining digital token copyright case. Is it a bag? Is

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<v Speaker 1>it not a bag? Who knows? It isn't a meta broken?

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<v Speaker 1>We don't know, But you know what, I think you're

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<v Speaker 1>completely right. This is a very very modern court battle, Stephen.

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<v Speaker 1>And it's one between the extremely expensive handbags and digital tokens. Okay,

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<v Speaker 1>let me break this down for you. So a digital

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<v Speaker 1>token featuring copies of M's broken bags did infringe the

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<v Speaker 1>fashion houses trademark rights. Now, this is all according to

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<v Speaker 1>a New York jury. The moment has been described as

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<v Speaker 1>a terrible day for artists. The case before a federal

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<v Speaker 1>court in Manhattan was one of the very first disputes

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<v Speaker 1>over the popular non fungible tokens to go all the

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<v Speaker 1>way to trial. So there we are. This is why

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<v Speaker 1>the battle is so modern. Now the French luxury design

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<v Speaker 1>house has been awarded one hundred thirty three thousand dollars

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<v Speaker 1>in damages. And this is for trademark infringement, evolution and

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<v Speaker 1>also skybus squatting, cyber squatting, a term I hadn't heard before. Now,

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<v Speaker 1>you know, these bags are so expensive, and they are

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<v Speaker 1>so so rare, and they retail between seven thousand, five

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<v Speaker 1>hundred and nearly twenty five thousand. But we must remember

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<v Speaker 1>if a rare one has been made, it can sell

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<v Speaker 1>for a whole lot more than that. So I was

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<v Speaker 1>wondering if meta bookins they're no longer on the market,

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<v Speaker 1>but would they have been cheaper? But you can't show

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<v Speaker 1>them off. So I was a bit like you screen.

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<v Speaker 1>So do you walk around with your screen saying I've

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<v Speaker 1>got a meta book and on a night just split

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<v Speaker 1>it in your home? Yes, this is true, further proving

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<v Speaker 1>than in cyberspace, only intellectual property lawyers can hear you scream.

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<v Speaker 1>Just last you though this story is a long reading

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<v Speaker 1>the ft B. It's really interesting, Sam, are you there?

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<v Speaker 1>The bizarre and brutal final hours of FTX. I actually

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<v Speaker 1>printed it out and I think it's a six page

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<v Speaker 1>read on both sides of the paper, So if you've

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<v Speaker 1>got a bit of time, please do reader. But Stephen

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<v Speaker 1>Carroll really inspired me when it came to the story,

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<v Speaker 1>because reading six pages on a Friday morning it's not

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<v Speaker 1>very easy. But this is an amazing account of what

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<v Speaker 1>happened during the collapse of the crypto firm f t X.

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<v Speaker 1>We have been covering this extensively on Bloomberg Now. Joshua

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<v Speaker 1>Oliver has spoken to the former x f t X employees,

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<v Speaker 1>people with real first hand knowledge of the events that

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<v Speaker 1>sent it really spiraling, and he's also spoken to Sam

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<v Speaker 1>bankmun Freed himself. Now, the article does include so many

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<v Speaker 1>messages from slack signal and other messaging platforms from Sam

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<v Speaker 1>bankmun Freed and other senior figures in the business. There

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<v Speaker 1>were really some incredible details, including how when reports of

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<v Speaker 1>troubles at f t X did start spreading, staff for

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<v Speaker 1>rushing to leave their offers, throwing out clothes with the

0:11:52.280 --> 0:11:55.840
<v Speaker 1>company's logo on because there were rumors people we have

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<v Speaker 1>been searched at airports. One employee said it was the

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<v Speaker 1>most crazy head take twenty four hours of my life.

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<v Speaker 1>I felt like my world was falling apart. F t

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<v Speaker 1>X was not just a job for me and for

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<v Speaker 1>other people. F t X was my life, and I

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<v Speaker 1>think this is something we do need to take into

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<v Speaker 1>account when we read this, real people were working there

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<v Speaker 1>and this has impacted their life and investors too. And

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<v Speaker 1>the article also saw an exchange between s PF himself

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<v Speaker 1>SPF and CZ, his arch rival. We see these text

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<v Speaker 1>message exchange when Sam bankmun Freed asks about the buyout

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<v Speaker 1>deal and CZ, Sam's biggest arch rival just basically said,

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<v Speaker 1>we can't continue with there's too many issues. Real short

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<v Speaker 1>reply to something that had been so eagerly anticipated and

0:12:46.360 --> 0:12:49.960
<v Speaker 1>also another nice thing in this article talks about Sam

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<v Speaker 1>bankman Fried's life and just how normal it seemed when

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<v Speaker 1>the journalist Joshua Oliver went over to his house. Apparently

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<v Speaker 1>there were hummingbirds around the fountain and his parents were

0:12:59.480 --> 0:13:02.959
<v Speaker 1>extreme degeneration welcoming. Yeah, I mean, look, I think it's

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<v Speaker 1>it's a great bit of reporting in the ft Um.

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<v Speaker 1>The thing is it's all going to court, and so

0:13:08.800 --> 0:13:11.839
<v Speaker 1>that that's the issue. I think it's what's what happens

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<v Speaker 1>in the court case is going to be a very

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<v Speaker 1>fascinating Thank you so much the against for our newspaper review. Now,

0:13:16.360 --> 0:13:18.800
<v Speaker 1>the latest inflation figures from China give us an indication

0:13:18.800 --> 0:13:21.000
<v Speaker 1>of the picture for consumer demand in the world second

0:13:21.080 --> 0:13:24.760
<v Speaker 1>largest economy, following countries easing of its COVID zero restrictions.

0:13:24.760 --> 0:13:27.880
<v Speaker 1>But what does it feed into the global inflation picture

0:13:28.280 --> 0:13:30.320
<v Speaker 1>and the demands on central banks. Let's bring in our

0:13:30.320 --> 0:13:33.560
<v Speaker 1>te Frates correspondent Garfield Reynolds. Garfield, great to have you.

0:13:34.000 --> 0:13:36.720
<v Speaker 1>Inflation picking up in China. What does it mean for

0:13:36.720 --> 0:13:40.120
<v Speaker 1>the rest of the world. Well, I mean I moved

0:13:40.120 --> 0:13:42.520
<v Speaker 1>a couple of things. You're on. On the positive side,

0:13:42.720 --> 0:13:47.800
<v Speaker 1>it does you know, speak to the idea that China

0:13:47.920 --> 0:13:51.400
<v Speaker 1>coming out of COVID can look forward to a stronger

0:13:51.440 --> 0:13:55.960
<v Speaker 1>growth profile than had been the case. And that's something

0:13:56.120 --> 0:14:00.760
<v Speaker 1>that a lot of people have been encouraged by, uh,

0:14:00.840 --> 0:14:05.079
<v Speaker 1>you know, the idea that the reopening trade would restore

0:14:05.679 --> 0:14:10.520
<v Speaker 1>that whole of the global economy that China had created.

0:14:10.880 --> 0:14:14.640
<v Speaker 1>It does also, though, add to the potential that inflation

0:14:14.880 --> 0:14:22.800
<v Speaker 1>comes bouncing back despite the concerns that you know, despite

0:14:22.800 --> 0:14:26.800
<v Speaker 1>the optimism that the slowdown we've seen in inflation rates

0:14:26.800 --> 0:14:31.080
<v Speaker 1>could extend. So that's something to keep an eye on.

0:14:31.080 --> 0:14:35.680
<v Speaker 1>One slightly positive factor there is that the producer prices

0:14:35.880 --> 0:14:38.840
<v Speaker 1>in China, and that is a key part of the

0:14:38.840 --> 0:14:42.040
<v Speaker 1>way that China feeds into global inflation is what's going

0:14:42.080 --> 0:14:46.880
<v Speaker 1>on with its manufacturing sector. They fell zero point eight percent,

0:14:46.960 --> 0:14:51.920
<v Speaker 1>which was a bigger than expected decline. So the inflationary

0:14:51.960 --> 0:14:56.200
<v Speaker 1>impulse out of China might not be too strong. And

0:14:56.280 --> 0:14:59.000
<v Speaker 1>I think in fact that, to be honest to FED

0:14:59.080 --> 0:15:01.960
<v Speaker 1>and so on, a far more worried about what's going

0:15:02.080 --> 0:15:11.440
<v Speaker 1>on with services and the potential for um, you, wage

0:15:11.440 --> 0:15:15.560
<v Speaker 1>wage inflation, for a wage price spiral, and that's something

0:15:15.600 --> 0:15:20.760
<v Speaker 1>that's far more about services industry in the US, bottlenecks

0:15:21.400 --> 0:15:24.440
<v Speaker 1>and and and other, and the long term impact of

0:15:24.560 --> 0:15:27.680
<v Speaker 1>the pandemic. Garford. Just speaking of the US, the treasury

0:15:27.720 --> 0:15:31.280
<v Speaker 1>yield curve has moved significantly. It's the most inverted since

0:15:31.320 --> 0:15:33.320
<v Speaker 1>the eighties. There seems to be a real rethink in

0:15:33.440 --> 0:15:35.920
<v Speaker 1>markets now they're getting the message from a hook ish FED.

0:15:35.960 --> 0:15:39.800
<v Speaker 1>How do you see it briefly, Well, I mean a

0:15:39.800 --> 0:15:44.000
<v Speaker 1>lot of ways markets have been, you know, not totally

0:15:44.040 --> 0:15:46.600
<v Speaker 1>out of that with the FED, especially when it comes

0:15:46.640 --> 0:15:49.120
<v Speaker 1>to long end the short and there's been a bit

0:15:49.120 --> 0:15:51.320
<v Speaker 1>of the optimism, like I said about the idea of

0:15:51.440 --> 0:15:56.000
<v Speaker 1>FED you could ease off sooner rather than later. But

0:15:56.360 --> 0:16:00.840
<v Speaker 1>you know, the jobs numbers last week really didn't help

0:16:00.880 --> 0:16:06.240
<v Speaker 1>on that front, or last month, and the curve has

0:16:06.280 --> 0:16:08.840
<v Speaker 1>been about this inverted for a while. It's also just

0:16:08.920 --> 0:16:12.440
<v Speaker 1>gone past a hundred and fifty trading days, which was

0:16:12.560 --> 0:16:15.760
<v Speaker 1>how long the yield curve in version lasted back in

0:16:15.840 --> 0:16:18.200
<v Speaker 1>two thousand and six, two thousand and seven in the

0:16:18.280 --> 0:16:20.160
<v Speaker 1>lead up to the two thousand and eight crisis. So

0:16:20.160 --> 0:16:24.560
<v Speaker 1>we've now got the longest inversion since the one that

0:16:24.680 --> 0:16:26.920
<v Speaker 1>ended in two thousand. The bad news is that back

0:16:26.920 --> 0:16:30.800
<v Speaker 1>in the nineteen eighties. That era again, we keep mentioning it.

0:16:31.160 --> 0:16:34.440
<v Speaker 1>Back then, we had inversions that lasted two hundred and

0:16:34.520 --> 0:16:40.080
<v Speaker 1>seventy and four hundred plus days. This is Bloomberg Daybreak Europe,

0:16:40.080 --> 0:16:42.880
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