tv With All Due Respect Bloomberg March 8, 2016 8:00pm-9:01pm EST
we have a stronger yen, which is earnings outlook for exporters. the cost be currently unchanged. -- the kospi currently unchanged. expecting the rbs rate decision tomorrow. they are expected to keep their cash rate steady at 2.5%. we are seeing the market housing boom and the bank in little bit cautious about overheating .emand and it's one hour to trading in japan. let's take a look at some of the movers and japan. all of these stocks are plunging today after the ratings were downgraded. fujifilm cut to hold.
mitsubishi has stayed down 1.8%. 2.2%, air rising today despite reports that pilots are going to rally in hopes of getting more active wage talks going on. following two point &, even when i be case securities raised its price target to 30,000 yuan from 27,000 yuan. sk hynix isakes -- down 1.3%. d: have a selloffs earlier in london. let's get over to sydney. paul is over there for us. looks like reality is sitting in again for the commodity stocks. paul: it does. reality was not suspended for
terribly long. giving up even more of those impressive gains with the iron ore spiked by 19%. the iron or prices are holding steady at $63 per ton. but goldman sachs and numerous other analysts don't expect it to stay there for long. mostly the other commodities have not. -- the londontsie se. got absolutelyn hammered. bhp 8.5%. real more than 9%. glencore off 18%. so i very tough night for commodity stocks. -- ands what is looking makes what is happening here in australia looked pretty tame. takata share price
taking a hit. this is one of europe's biggest heads bronze -- hedge fund stepping up against it. a global safety crisis. breaking news coming out of the race for the presidency. hillary clinton has won the mississippi democratic i marry. black rock -- democratic primary. blackrock says it will have to lock the doors instead of devaluing the yuan. does rick reader say is in the cards? zach: we have seen what they've done. the chinese stock market meltdown, yuan depreciation in
august, and subsequent capital flowed out -- out oft a two note china acted the note of $2 trillion. china had to burn through half $1 trillion to defend the yuan after they devalued it. and the burn rate has slowed. but that is still quite a hit. a stronger dollar combined with six interest-rate cuts in china in little more than a year further lowered confidence in the yuan and the currency that valuation in august to the end of the year. since then, since the beginning of the year, we have seen basically yuan stabilization against the dollar. it is basically unchanged since
january 1 at 6.5 to the dollar. and as you said, black rock's chief investment officer said china will try to avoid any further major devaluation. here is what he said at a new york investment conference overnight. interestingly, after the yuan was included in the imf sdr basket, it looks as though authorities are pulling back from their internationalization push. they comment that the national people's congress saturday were more watered down than in the previous year. in 2015, he was more specific. he said china would increase the flexibility and make progress and the capital account.
on saturday, he sadly said the relativelyremain stable at a balance level and in permits would be made at how the exchange rate is decided. it is settings yuan stability is the top priority. and alex wolf of standard life investments as simply china moved too fast on capital account opening. ishaad: we are looking at ambition to become the world's largest cinema chain. heidi: a bit of a cake in the plan for global domination when it comes to the cinema space. comic cinema shareholders putting his foot down. , $1.5e entertainment billion is the offer.
to vote against the merger because $30 a share at .he moment is seen as too low o this could potentially put amc's plan to become the world's biggest cinema chain through -- shares rising marginally. amc falling about 1%. zte says it is doing a thorough operations.n its this is in a statement that follows they hong kong stock exchange. the company says it will continue to cooperate with u.s. investigations. china's biggest --
second-biggest global supply said it found it sold u.s. tech to iran, thus running afoul of u.s. law. and company that wants to sell components to zte needs to get a license from the commerce department. came out saying up to 15% of parts used in zte equipment and smartphones is actually supplied from the u.s.. hong kong financial markets watchdog may soon be able to identify investors behind the trade making in real-time. it's developed a new see-through system where each investor is assigned ended identity record, improving market surveillance for regulations worldwide.
the proposal has already drawn some criticism from hong kong market participants. they are warning that it will give too much information about what people are doing in the market at any time and that they need to balance regulatory necessity with what would be an invasion of privacy. we haven't had any details on the timing of a new system. thesenvestors do expect conversations to begin in april. aad: north korea says that it now has the ability to make nuclear warheads that consists of a busted missile. malaysia bank governor is about to make a decision. reward, why china's growth could surprise investors soon here onward. back in a couple of minutes. ♪
rishaad: [indiscernible] >> hong kong is where institutional investors short china when they get bad news about china. our view is the chinese economy is fine. it is slowing down as it should. central and dollar economy in terms of nominal output. but do expect that economy to grow at 7% every year is just unreasonable. it should slow at a national rate is something light 6.4% if
you use the official numbers as a baseline. -- you know, it is a manufacturing-heavy economy and we are in the middle of a global trade war. tohave been in the last six seven years. as a result, manufacturing suffers. given the makeup of the chinese economy, it's perfectly reasonable that you expect china to slow down. rishaad: we know the problems there, but it keeps coming back and fighting it. the authorities are also acutely aware what is going on. i think people get concerned that they are not doing anything about it. >> i'm not sure that you can do a lot about it. all this talk about an intentional pivot away from investment and heavy industry towards consumption and services , you know, i think it's a bit
disingenuous, let's say. i think this is a dynamic that has been forced upon china. it is not something that they seek to do. it is something that is done to them. and given the chinese culture and psyche, it is always better to say that it is intentional. so this is a problem that the economy has to slow. it is at a size where it would slow naturally anyway. unfortunately, investors will pick up the headline and sell the market. said, 90 percent of capital accounts in chinese stock markets are retail. so this home and services is a bit of it had during the -- a bit of a red herring. got a two-step economy, a two sector economy.
you have an economy that is doing quite poorly in this excess capacity that needs to just be shut down and removed. then you have the new economy that is doing fine actually. if you look at the eye is some numbers, the pmi numbers that come out of china -- the psi pmi numbers that come out of china, i think the economy is fine. we hardly speak about the chinese bond market. equity markets are just sentiment-driven. have a natural rhythm. apart from china, look at what around the world where we have had a three-week rally. everything seems fine at the moment. information onal
the fundamental economic front, this rally, i think, is going to turn around and reverse. rishaad: we have already seen the kleins and the u.s. as well. you are also suggesting, under it iss. economy, perhaps, talked down a bit. you seem to be more hop shares -- more hawkish than other people are pricing in. >> yes. the modus operandi of the fed has always been to prepare the market for what they are going to do, let the market price it in, and then like the market and so as not to create any unpleasant surprises. so this it did in september when he didn't move. spreads had already moved in the investment grade in high-yield. pricing in a move. and in december, when the market had absorbed higher interest rates, the fed moved in what i consider a lagging move.
fast-forward to today, the probability around a federal hike -- a set rate hike employed to 9%,markets is 6% depending on the day. i think it is closer to 30%. i think the output gap is a lot slimmer. are inthe reasons, if we a global trade war, which i believe we are, the output must be smaller because productivity of the global economy is just not as strong. risk theyere's a might move. i think the market is underestimating that. u.s.ad: very quickly, dollar underweight equities there, right? >> yes. our view on the u.s. dollar is a fundamental one. it is a strong, stable economy. it is in a cyclical slowdown because precisely of the typing -- type of financial conditions. to 1.5%.wth heading
it is low, but not recessionary. and there is a temporary slowdown. and manufacturing pmi's are slowing down. you have to watch credit spreads. i think it is a temporary weakness in the u.s. dollar. it is a good opportunity to go along the u.s. dollar. qefor u.s. equities, absent and the fed is not doing qe anymore -- it is maintaining its balance sheet by not adding to it -- absent unique, i'm not sure of the you curve. qe, i'm notbsent sure of the u curve. rishaad: great talking to you. >> north korea has started to
heat up again. washington's is that pyongyang is some years away from reaching a breakthrough. korean and u.s. forces hold abusive or wargames. this is after china supported a resolution from washington. it will be at least 2020 before fukushimap of the nuclear plant is completed. than 700,000 tons of liquid stored at the plant. is awaitingco approval. the supreme court has overturned a ruling by the electoral ruling. was abandoned as a baby in
>> they are still deciding whether to make a bitter not to the general understanding is that they will wait until deutsche boerse reveals the merger agreement with lsu before revealing anything that ice does. rishaad: what is the chance of success here as well? is it possible that i said gets it rather than deutsche boerse? sam: regulators -- theaad: amsterdam, paris, london international futures exchanges well. sam: they are big everywhere. but they have a lot of listings. lse has a lot of listings as well. what regulators think about potentially merging those two together. rishaad: is anybody else
interested in the lse? sam: so far not. nasdaq is rumored in these kinds of things but we haven't heard anything rumored. it is a mean there is nothing. .ut we haven't heard it the futures businesses were their strength is and where they really have big market share. so we will see what happens. it is probably not going to be just the two. there will be more people throwing their hat in the ring. rishaad: thank you. let's look in corporate japan with canon reportedly leading the race for toshiba's medical division. it is offering more than $6 billion, head of fujifilm group and konica, minolta, and turmeric. consider alll three today. tell you what we have
coming up. position vacant in malaysia central-bank. i'm down after 16 years. there is no word on her replacement. we will turn to get over to kuala lumpur next. one of the most successful and intriguing artists living today. he draws on a boron -- a broad spectrum with a technique that has become his trademark. >> i have been very interested in the idea of repetition, repetitive marks, repetitive work. i like the single images again and again and again. each individual figure is a record of that time that i am making the figure. now, i may990's to
takata stock losing almost 90% of its value since 2007. its product is blamed for at least 11 deaths. investors are worried about slowing demand in china. copper fell the most since november. we've got the open here in hong kong, here in shanghai. is it more of the same? shari: today, there is growing concern the economy -- we're seeing the shanghai composite, which managed to rally for the past six days. it is feeling the pressure today. it is down more than 2%. we are seeing materials feeling the downward pressure. datad chinese export
showing it fell the most since 2009. that is also being felt through mining stocks across the region. the coast be index -- that cost kospi index taking a hit after china's dismal trade data. take a look at what they're doing in us earlier in bhp down more than 3%. down -- oz minerals down more than 4%. we are seeing a gain of 2/10 of a percent. this after the biggest jump, weekly jump in four years since they declined 7% last week. let's look at the price of oil.
oil is also feeling the downward pressure. today, down .2%, below the $37 mark. fallen below also the $40 mark at $39.50. we have already had news that hillary clinton has won the democratic primary in mississippi. donald trump has done the same thing. it is a fairly large prize. this yeartes from all and that is with 53.8% of the votes counted thus far. that donald trump has won the republican mississippi primary. when we get confirmation of that, we will bring it to you. embracing this idea venture capital.
raising more than $232 billion last year. >> you can think of this as a jew hundred $32 billion experiment in innovation. china has talked about mass innovation, mass entrepreneurship. so they set up a government guidance fund, which are mostly government money in some form -- in some form or fashion. don't know if you can buy -- is to bring up an inch -- an entrepreneurial class. the guys that i spoke to are aghast, literally jaws on the floor. this doesn't work because a typical vc guy will look at a hundred deals and find one or two. so if you look at a pool of --ey that's $338 billion
globally, the world invested $336 billion in vc last year. money thata pool of is three times bigger than the global investment. in terms of the vc world, this is outstandingly flabbergasting the huge. so can you find enough guys? of course, china, 1.3 billion people, there are a lot of them that are entrepreneurial. rishaad: how do they spend it all? could it be just spending good money after bad at the end of the day? shai: exactly. and china has this habit of, when there is a policy directive, everybody piles in. the government with all the best of intentions, basically the floodgates open for finance and everybody knew that this has the green light, so whatever you can
do, it's not about getting a return, but getting the money. you had a boom and bust in both wind and solar, which has global repercussions. it destroyed the solar industry in the states. this be another cycle of boom and bust where you have so much money pouring into a tiny field, relatively speaking, and then blowing things out of rack -- out of whack. 200 billion yuan fund with the broader goal of marshaling sort of a mix of private and state funding of one trillion yuan on top of the stuff. that is a lot of money. [laughter] shaiad: thanks a lot, oster. let's take a look at some of the
other stories we are following for you. the bank of england has spent monster into stay out of the inate of britain's future the euro zone. has made nojapan progress in rising women in management. last year, the number is 4%, same as it was in 2014. the prime minister wants more female executives across all fields in japan. lastly, he declined to give another term to the only woman on the boj's nine-member board. malaysia central bank governors will oversee the final registry rateion -- final interest decision today.
how have things changed during her time at the wheel? in: the governor came in at financialing the crisis of 1998. she came and acting governor before she was appointed governor in the year 2012. 16 years later, she is leaving duringtral bank political turmoil, tensions, and lending scandals. after 16 years at the helm, she is leaving the country. there are better capitalized banks and the world's largest finance market. rishaad: what do we know, if anything, about who replaces her? hamim: unfortunately, we don't know very much.
the offices of the central bank will that the candidates -- will vet the candidates and give several names to the government. they want someone in the central bank to succeed her. malaysia is really in the midst of a lot of issues now. there are some huge challenges facing the country. there are no doubt huge challenges facing her replacement. shamim: exactly. malaysia is a commodity-based economy, still in many ways. so with oil prices and global commodity prices not doing very well, the finances of the country have been affected. we have also seen an erosion of our foreign reserves as the
central bank went in to defend the currency. so the challenge has been a slowing economy that the next bank governor will have to address. rishaad: thanks for that. gold maintaining its recent gains. sincest start of the year 1984. >> let's start by expanding this chart. we are looking at anticipated inflation over here in the u.s. over 121 days against gold. usually, in terms of inflation, gold also rises. they tend to go up together. go back to the 1970's, gold had one of its biggest ever rallies at a time when inflation was rising up to the peak of about 15%. ,ut what is happening now
patients for inflation is the weakest since the global crisis. so what is happening here? the correlation between anticipated inflation and the gold price, right here, has slipped. it is now an inverse relationship, the strongest in 12 years. what are we interpreting from this it could be that the u.s. economy? is seen to be weak. policymakers are losing some traction over the economy. i'm going to try to bring this chart for you. let's see if it works. note. ok. try again. right. while i will just have to talk about it then. essentially, we're looking at gold prices and global equities. as goldquities rising prices of late.
their global markets have risen by about 7% or so. by 5%.s been up normally, we see the to have a diverse relationship. gold would fall as global markets are rising. but at the moment, they seem to be moving in tandem. suggests perhaps that investors are not as confident in global equity markets as it would seem. it points to perhaps less than expected confidence in global equities and also in the u.s. economy. rishaad: thanks a lot for that. rolling across asia, how rolls-royce is planning to expand in the region. the global director of sales and marketing joins us live. ♪
amnesty international have criticized a plan. eachroposal would mean migrant would be forcibly returned. completelycede -- seal its borders to undocumented migrants on thursday. israel has disputed claims that benjamin netanyahu took the white house by surprise by canceling a visit planned for later this month. the obama administration says they heard about the decision through the media. said he didn't not want to visit during the tumultuous primary season. ae weaker yen leading to something and tourism.
it handles 75.3 million travelers, having expanded operations in 2010. london remains [indiscernible] to boostrolls-royce flagging sales numbers. has broken all previous rails are a -- rolls-royce records for preorders. will come to the program. fenton. singapore is a huge driver for this particular model. it must have a huge price tag.
yes, unfortunate, that's life your good morning. some of the asian markets do have very high taxes in a vast array of products. and rolls-royce is unfortunately not immune. rolls-royce is an exceptional product here in singapore and elsewhere in the world, whether it be europe or the united states. goes, thee've got the phantom, and the race behind you. what sort of sales numbers are we looking at at the moment for southeast asia? intan: we don't really -- we don't release specific sales numbers. star it goalthe go weight in our portfolio at about 4000. phantoms are above that and they are a it of a smaller isn't tatian in our sales figures. rishaad: what are you seeing in terms of demand? we see this crackdown on excess
in china. how has that been affecting sales in that country and elsewhere? intan: china was very john mack take in 2015. but we are a global business and we are very well-balanced. we have quite a robust set of sales around the world and that allows us to ride out the highs and the lows. rolls-royce is about sustained sales growth. to beseems very much stable. there's still lots of capital and opportunity in china and we are in china for the long-term. we expect aspects to recover slowly. rishaad: so this year, we probably aren't going to be a recovery. as you say, it is stable. where has the slack been taken up? last year, we saw growthtan: in southeast asia -- : last year, we saw growth
in southeast asia. north america continues to be the biggest share of our sales with almost 30% of rolls-royce sales globally. and the middle east was also a strong year, 4%. the fall in the oil price, perhaps that helped you when you fill it up, but nobody needs to ask about how much on fuel costs when you are buying a rolls-royce. you can see that is something that is likely to grow or do you see the negative fall in oil prices will have a dismantle effect on demand? tan: it is having an effect on demand. we are a brand with exceptional business. we have challenges ahead. global,we have the balance portfolio, it makes it easy for us to balance your this year will -- balance.
this year in china will be softer than last year. rishaad: you mentioned the u.s. solid. europe is pretty europe will be a growth year for us. n has been well accepted. those who have seen a car are astounded by it to it is a four seat, drop-down troop. pe.drop-down couy rishaad: i guess you have to be looking at millenials. how do you tailor the cars to fit their needs? n: you are right. diversified. it is very global. it is very female. and it's very diversified. i think in the next decade or so, we expect thomas $41 expect almost $41
trillion to change generations. verythe dawn, it is a social car. it makes it the perfect car either for business or for pleasure. rolls-royceays, the customer was a tightening industry. in geneva, we show the latest new offering, a brand transformation, the so-called rolls-royce black badge. rishaad: we don't have time to talk about the black badge, but thanks so much for talking to us. to take a break. , more big sponsors walking away from maria sharapova as the debate moves online. looking at how social media reacted to her drug failure. ♪
rishaad: today brings the latest contest of man against machine. that cans a program beat the average human in the game of goat. paul: vc dollars getting ready to rumble. this go player will take on an artificial intelligence program. said i am confident because i thought it would be so difficult for the computer's artificial intelligence to read the human sense, such as intuition. fromer, what i felt listening to the explanation about the algorithm was that alphago may be able to mimic the
intuition of human beings to a certain degree. go is a complex again. in chess, the average number of moves is about 20 from the average position. about 200.s lee is in sure he will win all five of his games against the mind. but perhaps he is being optimistic. has already wiped the european champion. it is at this point the project becomes more than just a game. the number of high-profile thinkers from elon musk to stephen hawking are already warning of the risks to humanity from creating artificial super intelligence. the creators about thego consist alphagoreators of consider it neutral. >> we worry about lots of these things and we are thought
leaders on the ethics front of either how these systems should be used in a way that will benefit the many and not the few and will benefit society that exists. paul: the winner of wednesday's contest will take home $1 million. --hough it is unlikely togo unlikely alphago has any sub processing of greed. haidi is looking at how big brands are wanting to get some distance. they are reacting much faster than they would have in the past. rishaad: but they had lots of practice. haidi: nike, one of her biggest sponsors, over $100 million over eight years, suspending the ideal. they also had to do that recently with manny pacquiao after his controversial comments.
porsche did the same with maria. she's the richest woman in spore. what are people saying? huge: we have had a reaction. jennifer capriati, a one-time world number one, really going on, saying it isn't fair. the less the -- the last of the competitive athletes. the time you have to be at the top is so sure. this is a substance that is used diabetes. marty never -- martina navratilova say hold your horses. i have's we should hope that this is an honest mistake or a -- mistake.
will have to "rock of the doors and impose capital controls." state media saying a ballistic missile is a true deterrent to war now. twitter. on don't forget to use that hashtag. trading.a today, no sherry is having a look at what .lse is out there looking at the global economy and the glass being half empty. >> it looks like it. we are seeing a bit of a mixed pick sure. picture. major markets falling right now. we are talking about china. we are talking about japan. there is also the sentiment because of retreating oil.