tv Bloomberg Markets Asia Bloomberg August 1, 2019 10:00pm-11:00pm EDT
♪ mike pompeo, talking about -- coming a bit out of left field. maybe we should warn beijing about these extra tariffs. there was a know about that. it is like deja vu all over again. acrossbiggest drop equity markets, the dollar is bid. word koreanng officials, talking geopolitics. watching for equity. the guy with the finger on the trigger in case they need to
intervene. with yen. are seeing the likes of the yen, gold treasuries. to bangkok and bring you the live situation. mike.s. secretary of state pompeo talking to the crowd. >> $60 billion. in the end, we believe in democracy. our friends for returning to the democratic. we believe in human rights and freedom. we want free and fair trade, not trade that undermines competition. we want trillions of dollars to be put to work in this region. private investors have more money than any government could
bestow on any other country. our investments do not survey government. not serve a political party. pay foruilding roads to our national sovereignty. our companies are incentivized to do high-quality work. ask yourself this. who really puts the interests of the people first. a trading power that respects your sovereignty. who really fosters innovation and reform. ask yourself this spirit who encourages self-sufficiency and not dependence. investors are working to meet needs?
or those who entrap you in debt? the united states today has the strongest economy in the world. our consumers are driving demand for your products. china's economy is reaching a new normal rate the problems are unknown. helped shine a light on them. all we want is for china to compete on a level playing field with everyone, not just the u.s.. this will benefit not only us but you. right to do more together, using the model that has worked. one analysis predicts for the first time, asian economies will
be larger than the rest of the world combined. the asian middle-class has exploded. age.has come of let's keep trade free and fair. high standard investment that creates local jobs. for the standard rights of nations. i am looking forward to keeping -- taking questions and talking about issues in your mind. i can't help but think about these ideas in bangkok, thailand . you maintain your independence. you held to the path of sovereignty. we have supported you for more than two centuries. came to thean first
kingdom as a missionary. westernht with him medical practices. served the royal court. the friendship of the future king of siam. firsto brought the printing press and founded the first newspaper. he brought knowledge that gave rise to friendship. his legacy is bigger than that because it did not stop there. daughter opened -- right here in thailand. the anecdotes point to this, for centuries. the legacy has been about partnership. not just in our government.
we build things to last. president trump will continue that commitment. god bless you and i look forward to your questions. thank you for being with me this morning. speaking in bangkok. of free trade and highlighting the partnerships they have had. between the countries here. was driving a wedge and making the distinction between china and themselves. let's get back to hustling the almond. of chineselion worth goods. that does not bode well for the world. what happened during those talks?
how bad were they? begin in washington in september. back to first principles. for decades, china has taken advantage of trade. versus countries in southeast asia. said we areump has going to fix this. that requires determination. the president determined to achieve this outcome. the chinese agreed to it, and then walked away from the deal. weight -- is huawei -- >> this is bigger than this? how trade will be conducted. ok for them to take advantages. is it ok for a nation to take on
tariffs? to not put barriers when the u.s. is wide open. all we have asked for, it is simple. it is what you teach your kids. fairness, reciprocity. these are core concepts. asia will thrive, southeast asia will thrive. a nation be the case needs protectionism to protect its own goods. to deny others the chance to grow. >> at what cost? we are seeing pmi easing. countries around the world revising downward growth projections. yes, the u.s. is in a good projection. saying he will
tax the hell out of china. there are negative implications. >> implications of decades of bad behavior on the part of china. >> when you look at how the u.s. -- >> every business in this room but we will fix it. >> the scrutiny right now, chinese companies, especially through the committee on foreign investments in the u.s., of which you play a huge role? about 173 companies worth $750 billion. actively listed in the u.s.. chinese companies. just in the u.s.. umag --u be sending negative message? >> we welcome this.
all day. we want to make sure the basis upon which this flows to the u.s.. american that wants to come to this region can come. it is what nations must do to protect their own sovereignty. do so through transparency. don't subsidize those countries. them.create chinese companies well, and be successful. we welcome that. the >> of this trade tensions is actually a fundamental misunderstanding of how the u.s. views china. china today is different than china 20 years ago. reform. time to
a misconception in those views? i had to be a chance to be with dr. kissinger. celebrate theo anniversary. up, theyonomy opened would begin to compete. that has not happened. that is what we are driving for. it is elemental. >> if there is one thing china needs to do, what would that be? one first step? >> i am not directly involved. there was an agreement that would have put us in a good place. to where weome back wear that day. >> you touched on hong kong. how the government needs to listen.
murmurings suggesting there is a congregation of way -- canng their you envision that happening? >> i think president trump has been clear, we have asked for the right thing. the tradition making sure everyone has the chance to express their views. i hope the way things proceed will be not violent. for any parties in the region. citizens will want to voice their views, whether in support or opposition, they will be able to do. >> it is a chinese issue, hong kong. should they make their way across the border into hong
kong, the streets of hong kong, with the u.s. exercise any military presence? own judgment to make its own way and defend hong kong? administratione has been good about is not tipping our hand about what we are going to do or not do. >> i will take that. on north korea. it does seem like president of faith given a lot and face time to north korea. there have been two summits. he has made suggestions about inviting him to d.c.. that seems like a lot to give for very little in return. we are back to square one with north korea grading your
presence with a series of missile launches. your take on that? >> i think you mischaracterized that. get it did not give him a darn thing. it is an attempt to engage with them diplomatically. achieve an outcome that has not been achieved. many has have been tried but they have been unsuccessful. i was the first one to begin this opportunity. we are still engaged and we hope they will put their working group back together and meet with us. the un security council still has the most stringent sanctions ever imposed. we are working with countries across the world, many doing great work to ensure we have the capacity to deliver what chairman kim committed to a year ago.
hising the nuclear eyes country in exchange for president trump describing a future with the north korean people. >> >> those launches are against u.n. resolutions. towhat stage will you decide tighten those sanctions? should never doubt what we may be communicating to the north koreans through our conversations. diplomatic paths are often fraught with bumps. we are fully committed to achieving the outcome. denuclearization. through the use of diplomacy. >> how confident are you you will get there? >> we keep working at it. onconversations cannot go for ever. at what stage will you take
action? toughest taking the stance in recorded history. the world affecting them, it is difficult to imagine there would be eight set of tougher sanctions. this is the right thing for the world. it is the right approach today. willdent trump and i continue to evaluate that along with our partners. the chinese, the russians. those with a interest in seeing north korea the nuclear eyes will continue this. a summit looking at anytime soon? >> stay tuned. >> have you been disappointed you are north korean
counterparts did not make a? >> i wish they would have comp. >> we could have have a different set of conversations. getow do you expect to negotiations going when your own counterpart is not willing to make himself available to talk? conversations are taking place. concerned are you? we are always concerned, right? madedent trump has nonproliferation a centerpiece of our work. he understands we are working to engage in a security dialogue. all have a central theme.
i want discussions to proceed with the north koreans. we want to get the execution on the ground. that is the mission the laid out.has >> what role do you think china can play in this? >> a bigger role. i applaud the chinese efforts. they have been able work. they have been helpful. i met with my counterpart. they reiterated their goal to be a diplomatic resolution. commitment to enforce the resolution. >> one question. you talked in iran. the u.s. has been trying to what a lid on exports. there are concerns your asian allies are importing iranian oil. what are your thoughts? you'd tend to take action?
the sanctions were put in place, there were 2.7 million barrels a day. the number for june and july, each of those months was less than half a million. the sanctions have been effective. we will enforce them anywhere. any country that continues to violate the sanctions. oneave impose them on company. it is imperative we deny the ila told us from having the resources to build a program that could threaten anyone in the world? flex thank you for your time. ladies and gentlemen, thank you for joining us. mike pompeo talk china a
center of that debate. time for china to stop taking advantage of trade. >> a multitude of topics. i ran there as well. let's try and wrap everything up. stephen engels is here. the china correspondent is in beijing. key takeaways from what just happened? flex the beginning of the speech concentrated on the trade war. this latest tariff. we will go into more detail. he derided the decades of bad behavior by china. there trying to rectify it. crowd, appealing to the and the audience there. in bangkok, saying, which do you
want to do business with? subsidize state owned enterprises. in hong kong, interesting comments or no comments. on monday.ords urging the leaders to do the right thing in terms of hong kong. which sparked a rebuttal. saying, it is clear mr. pompeo has put himself in the wrong position and regards himself as the head of the cia. he pre-much said, -- pretty much said i hope there is no violence and we will not tip our hand when asked about what response the u.s. might take. if troops take to the streets. even declare martial law.
a number of different comments saying the meeting did not give him a thing. backtracking from a comments saying we gave kim jong-un too much face. at half being the meeting the dmz. finally, wrapping up saying sanctions have been effective. it is imperative we deny tehran the ability to build nuclear weapons. >> when it came to pompeo, not exactly holding back in china, either. >> taking a swipe at china. a reminder this is not just about trade. a broader set of issues. comments, -- building on the common, saying it is time to choose. enterprise, the
capitalist a system. the other, state backed capitalism, coercion. debt diplomacy. something they talked about. taking a swipe at the belt and wrote initiative. .- wrote initiative coming on the back of these tariffs president trump announced. president trump saying he is going to raise these or add tariffs. on top of the 25% tariffs already in place. thequestion is whether talks will continue. the question is how and if china retaliates. thee was highlighting
relationship with the u.s. with the various countries. went on this attack. alwaysed like he was making these countries make a choice. the point he was trying to make. it was time for that to stop. he said it was china that walked away from a deal. fairness. for is he says america is open for business. those of you in the audience, come to america and participate don't subsidize. he says china has been very helpful, playing a pivotal role read at the same time, they are going to continue to take what e toughest stance
in recorded history. >> we had talks this week. towards, looking september. affect thee tariffs probability of us seeing the progress we had hoped for in september? you calculate or look back at the commentary we have heard since may, when negotiations broke down, it is very hard to see how the threat of additional tariffs is going to change the direction. if anything, it can be argued this is going to strengthen the hands of the hardliners who say trump cannot be trusted. it is difficult to see how this is going to get china to make concessions. unreliablelist of
entities. we are looking to see if any u.s. companies operating here in china face those barriers. licensees issues. goods being held up at port. we do have the news maybe chinese companies are buying more soybeans. that is a key gripe for president trump who said china had not met its pledges to buy more agricultural products. that is in focus. we are going to be listening for commentary from officials. economic side, whether policy makers look to step up support for the economy. so much.you we did not get to south korea and japan. which we will try to flesh out. a busy news day. >> japan, south korea removed
10: 20 9 a.m. in hong kong and shanghai. i am su keenan with the first word headlines. president trump and imposing tariffs on chinese imports. he is warning it could rise to 25%. the new tariffs affect $300 billion of good shipped from china. the president says his counterpart must do more to resolve the trade disputes. >> i think he wants to make a
deal. not moving fast enough. he said he was going to stop fenton all coming into our country. we are losing thousands of people. >> mount -- markets coiling on the news. biggestseeing the two-day drop since may. trump said he is not concerned saying i expected that a little bit. oil fell the most in four years on fears the escalation in the trade war will exacerbate the global slowdown. protests in hong kong may be starting to deter gambling in macau. revenue fell, down 3.5%. that is down from a year ago. a tworecast cut short
month rebound. casinos had been holding up in the face of the trade war and the chinese economy. tourist arrivals at record levels. boeing, the company redesigning the flight control center to employ data from both computers rather than just one. we are told they hope to present a final software package, although the time landing could be adjusted. the approach is more comprehensive. they have been preparing to fix flaws linked to crashes. in air, 24 hours a day. i am su keenan, this is bloomberg. red friday.ery have a look where we are. want to put a good spin on
this but there is not really one. session lows, overall, in terms of the data, it has been stable. about sentiment. >> we are watching what is going on in korea as well. japan removing south korea, hearing a lot of lines coming through. south korea saying they are going to take a stern stance. saying they are going to have a meeting, discussed this impact to the economy. the trade minister says it is not going to impact global supply chains. we are watching the likes of the cost be. futures, indian not looking good. earnings have not been good.
pound.talking about the >> a loss boris johnson had. we didn't see sterling moved to the upside. 9% in thetimates, first half. one of the first stocks feeling the love, as it were. let's move to hong kong retail sales. >> might be a silver lining. in june. the overall economy, contracted from the first quarter into june. continuing protests. the newest china trade war. kong. talking about hong we are seeing these protests.
what are you making of it all? >> it is going to be a difficult time for hong kong. another escalation of the trade war. issues, i domestic think that is going to weigh on consumption. >> social media being used. is there a thought among the companies invested about hong kong exit? >> i think it is the early days. if you look at the second-quarter growth numbers, we saw investment drop quite a bit. clearly, that is a big drop. it is too early to talk about it. >> how do you play that? investors deal in probabilities.
it is the small probability, whatever that may be. currency exposure, what do you think? currency ishe insulated. we are not seeing outflows. the liquidity issue is different than what we are seeing. tight.be quite we see -- still elevated. clearly, we are not talking about a scenario that is far away. equity wise, talking about china. tradethe u.s. china tensions, equity will be coming under pressure. that is where we see the big impact. towardng equities skewed mainland china. storyill be the bigger for hong kong. >> what about the property
market? >> a key. sentiment has seen a bit of a pullback. we have seen secondhand properties turning up a lower. investors are going to be cautious. >> you have so many curves in place. these things are going to be chipped away. thenvestors who bought over past two years, they do not want to sell. home, ioing to buy a probably would not want to buy, looking over to-three years, unless i'm sure about what happens. does support the property market is real demand. we are seeing real demand is strong. total of the demand over total supply, it is very small. if we break that down into
private demand and private supply, there is a big gap. there is real demand for the property market. if i were looking to buy, i would be more cautious. kong locals or mainland chinese investors? we need to rethink that? >> i think a lot of that is local demand. householdhat down to growth, that is how we are looking at the demand future. household sizes are getting smaller. we are seeing bigger demand and that forms real demand for hong kong property. trumpare seeing president , the timing of this. coming down to the fed decision. one question we have been asking, do tariffs matter more?
>> in the near term, it is definitely tariffs. they impact sentiment. say is whenould sentiment gets to a negative face, that is buffered by expectations the fed will come to a rescue. we are seeing markets pricing and rate cuts. we are looking for the chance of point cut. if markets panic that much. maybe this is a way trump is trying to force the hand to do something. >> it did look as if jay powell was being bullied. he was not as deliberate as careful as he normally is. does he want to cut rates? boss the market or his forcing him? init had more or less priest
race cuts -- christ in rate cuts. i think powell did pushback. he noted the data is turning better. there is no need for them to be cutting at this point in time. making sure the u.s. does not slip into a down cycle. .hat is the big take away >> watching currencies, i have seen dollar china at 695. how much pressure is there in trade reliant economies? of a doublek a bit whammy, given it was in the white list. it has been talked about for a while. exposed to thee u.s. and china. we are seeing dollar korea head higher. following dollars cnh.
the other would be in taiwan. these are the two big economies linked to the trade tensions. getting market share. given what has happened, taiwan has been benefiting from a bit of it. in the broader picture, it will be difficult. >> thank you for coming along. a lot more on the way. get a preview of the trading day. that is on the way. this is bloomberg.
capital funding means it is well set for the rest of the year. >> speaking of earnings in singapore, profit rising unexpectedly in the second quarter rate lending and trading income. net income climbed 8%. forecast the to year before. they will join a larger rival reporting larger than expected profit. aftererest jumping in the hours. on strongorecasts demand for advertising. beating projections of $235 million. pinterest added 9 million monthly users. up 30% from a year ago.
>> china's largest gas distributor capitalizing on a push to consume cleaner fuels. he said how he expects to bridge the gap. >> china may import as much as 250 million tons by 2030. buteld several negotiations a deal had to be suspended because of the trade war. we were waiting for the u.s. and china to reach a deal before restarting talks. we are willing to find a way to move the deal forward. >> if terrorists remain in place, how much do expect to import? expecthat quantities do to be importing from the u.s.?
i hope it won't happen. we want to diversify our sources. lowering our cost. middle eastern and russian companies among others have approached us with natural gas levels. in contact with several suppliers. economy has slowed to the weakest pace since 1992. your customers are an industrial and commercial enterprises. what is your view on the chinese economy today? >> there is no denying the economic growth has slowed since last year. to be honest, such adjustments do not have a direct impact. i'm not saying the situation does not affect they sick
opportunities are come from the restructuring. around 40-50 industries we serve, only one-to have seen a direct impact. other industries appear to be doing just fine. >> you left a government job to make this more efficient. what is your take on the current pace of reform right now? treats state owned companies? china's gas distribution reform should be the most successful if you pick a winner. gas,includes water, power,
and public transportation. i see opening up as the biggest driver of reform in china. it does not decide whether you are successful or not. the key is efficiency and management. any company has a chance to be successful. talking to selina wang. >> coming down to the open over and india. this chart tells you, down 9% from the peak. minutes until the open. he is in move by for us. is the big, what story? or is it a macro story? absolutely, the macro story
has not only implications domestically. continuing weakening earnings. we have low expectations. by that, i mean some of the larger companies. we are expecting more to come through with negative implications. deep losses. coming from the mark of $11,000. psychologically important levels . we have seen weakness. we are going to keep an eye on some of the consumption needs. not much in terms of expectations. is going to be up to the earnings, how they move the indian markets. toeign investors continue serve for now.
>> joining us from mumbai. he is from the milken institute. great to see you. what did you make of mike pompeo's stands today, his speech? certainly setting out america's stall in the region. strong speech by the secretary of state. the message was clear. vision ofrth a prosperity. one that is being challenged by secretary. are they going to stick with call?r is there a siren attracting them to maybe the wrong path forward? it didn't sit very well when
he was espousing america as a champion of free trade when his boss put it at $300 billion worth of chinese goods. >> the secretary hit that question at the end of the q and a. >> president trump has been consistent. he is seeking a level playing field. if that is what it takes, hopefully both sides will address this trade war. at china's past, they have acknowledged the present system is not sustainable. a hammering with these tariffs, they can hope is not for the long run. getting things to move forward.
quiet's -- >> hitting consumers. we are not talking about -- we are talking about actual consumer goods. happende talks going to after this escalation of threats? >> i hope so. a long discussion. yes, talks will continue. both sides, china and the u.s. recognize things need to change. what secretary pompeo was saying, the southeast asian brought you at what
this prosperity. let's do it in a way that involves china. china needs to look inward and realize we are here at this trade war because of china's behavior. we are hoping for a more constructive path forward. think putting it as black-and-white as the secretary of state tried to frame the issue, it is either us or them. we brought prosperity. they are encroaching on your sovereignty. way to approach something and make this constructive? do you think framing china as all bad, it is the right way to approach this? >> i sat here. i did not get that from that speech. i got indeed countries can decide how to move forward?
the principles involved. saying, we can move things forward. china can think about how it evolved. china of today is different than 20 or 30 years ago. that poor, longer developing nation. our systems have to of all. china recognizes that, too. i saw it as a way we can all move forward it will are changes on the behalf of china. >> you mentioned the changes. politically, how much has it moved? up its soft power. a vague threats. they could destroy that work. power.ing that soft
china is not always so forthcoming. hong kong also came up today. one true for the world. governed people will always be heard. that is what is happening in hong kong today. what is happening is not a good thing. saidl like the secretary there is a peaceful solution to this. chamber ofn commerce, others have called for the withdrawal of this bill. allegations of police brutality. something i hope the hong kong government will embrace. the hong kong economy.
i think the secretary was clear on that. clark's we don't have much time. there was talk about korea and japan. i am wondering how the u.s. can diffuse the situation between the allies? >> talking about the tensions between south korea and japan. they have removed them from a list they have. the secretary has called for the have a discussion. they are tremendous examples of what the secretary was speaking to. my hope is they can come together and to be those shining examples for the rest of the region of what a country can create when they embrace free trade, a free system, allowing people to speak their mind.
emily: i'm emily chang in san francisco and this is "bloomberg technology." coming up in the next hour, trade tensions rise. president trump will impose a new 10% or up on $300 billion in chinese imports starting next month. this in addition to the 25% tariffs already imposed on other chinese goods. u.s. stocks tumbled. could iphone and other things rise as a result? plus, the acquisition inquisition.