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tv   Bloomberg Markets Americas  Bloomberg  July 9, 2018 10:00am-11:00am EDT

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vonnie: top stories we're covering from bloomberg and around the world. theresa may force to announce a after theecretary former one quit. trade tensions. victims from the latest u.s. increasing.-- are the ecb -- and donald trump announces his supreme court pick tonight. .e get a breakdown ahead i believe you have breaking news? got the headline,
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crossing the bloomberg. this is about the u.k. foreign secretary lawrence johnson. theresa may have accepted his resignation. this coming through after late sunday. secretary davis, and also, the person below him. this is coming through, that boris johnson has resigned. -- replacement will be out shortly. ise a look at what sterling doing, dropping below 13305. so far, also theresa metta for now was safe in her position. there were questions over whether there might be more resignations coming.
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what might be mixed, whether this was the beginning of trees a may's downfall, that didn't seem to be the view where i was today, not saying this is. syriza makes setting the doris johnson as foreign secretary. very heavily for brexit. vonnie: a powerful signal to voters. it might not even be being delivered at the moment. that is to resignations in the space of two days. let's get a quick reaction from someone just hearing the news as we are hearing it. with us, we had been about to talk trade. resigning yesterday, and now boris johnson is the face of the lead campaign in many ways, going. what does this mean? >> i think it is more
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uncertainty. that is something the markets have been struggling with, and it is interesting to see what is happening to london and england in general, the u.k. in general. they have suffered. appreciation of their currency, which has helped exports maintain and help the economy remain stable. it has been worse -- suffering. what brexitnot know is. unfortunately, the political uncertainty that we see in the u.k. now, it is something we are also seeing at the european union as many fractions have these divisions out there. this is the real problem. the trade wars get ugly and it , doing things that don't make sense. things that they think theresa may's trying to do a soft brexit, the idea was to still this is the. but
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same thing we are facing in the united states. behind a certain policy, no longer is there a gallon -- a guarantee that it will get done. we are trading the pound at 130 414. it could be spread to other financial assets. largeris become a contagion? >> that is the problem. one thing is the pressure to go to the brexit, they just wanted parameters and to know what roads they were driving on, where the potholes are. there is no road map brexit. that is where the biggest problem is. businesses have to make decisions. >> i just want to bring you a couple of headlines. , theg the brexit problems
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fact that we still have a lot of uncertainty. also saying about davis the politicians come and go. the unity of the cabinet. interestingly, we are seeing sterling holding up. still up .2% on the session. the question of whether it is all about the bank of england and the august rate hike. a general question about this. should central banks ignoring, ?ot just in the u.k. in his pressit conference saying listen, right now, trade tariffs and tensions are not showing up in the overall economic statistics. the problem for the central banks is they have to be very careful in how they tread, to
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not look to political, and they can't really react until there to adjustng to react the uncertainty itself, you are seeing that within the fed presidents, the independent russian 10. influencing them. they're much more outspoken about uncertainty and what is -- what it is doing to the digital company's plans about their investment. the same is coming out of europe now. the uncertainty of trade with the u.s. is affecting business investment. i think it is important for central banks to stay very cautious in how they talk about even though it is something that clearly affects the economy over time. >> absolutely. the fed dual mandate looks at the unemployment rate and inflation. see that what we has been happening with the trade war might have been affecting the labor market in the u.s.? the profit margins, which is
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probably part of the reason we are not seeing there is a long list of reasons. you are seeing in the pipeline inflation, prices have gone up quite dramatically in the united states. it is starting to show up in the united states inflation data. it is something the fed will have to deal with p earlier starting to see a lot of fed behind or the ahead of the curve on inflation? >> still up .4% and you can see the movement in the 10 year with the yield of 1.30%. not a massive moves. to some extent sedated. charlotte is with us. to what extent were people actually anticipating boris johnson resignation coming so quickly on the heels of the
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, how many doeson this present to theresa may, and i can just ask you this, -- >> go for it. what was the question? i am watching charlotte walk-on to set now. much peopleous how were anticipating a boris johnson resignation? so many times over the last couple of years, he could have resigned, right? he didn't. he stayed until now and now he is gone. >> it is one thing they are expecting. the question is will to reason may actually you -- lose in the challenge? the numbers are very unclear. though the conservative party is divided within itself in the u.k., it is still unclear that she would lose in the challenge. they can actually win by challenging the stage of the game and then they have a long lag time where they can again.
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>> i'm curious to see if there is a reason why everyone is leaving now. will there be a concerted effort to challenge leadership? >> it is an interesting question. of skepticsa group and he says he did not think the no-confidence vote interests may, he saw her staying until march. if you look at how the fx market has been reacting, the suggestion is the pound traders see theresa may staying in place and they see a softer brexit. >> exactly. it explains why we saw some of the earlier gains but we hadn't seen a dramatic climb in the pound. there is a realization that we have been dealing with brexit and parliamentary for a while now. this would just be the first step. i had a strategist tell me just before the resignation that they
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do not think this will lead to a leadership challenge and if it does, it is not simply a chase of the cap -- case of the challenge. most people market do not seem to be expecting it at this stage. >> what is behind the pound volatility we have seen as well? ,ou look across u.s. sterling it has been subdued. is this just because traders are expecting so many bumps along the road and they are waiting on the sidelines? >> i think that is exactly what it is. has been a feature for at least the past months. -- past month. a lot of them are either keeping small positions in sterling or they are waiting on the sidelines. what about the risk to the upside and the downside? are they asymmetric?
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>> it depends on who you speak to it we had this story at the end of the week saying the pound could go up toward 135 on theresa may, slipping as well as 135. it looks like we're somewhere in the middle of those two. at the moment, the risks are probably slightly more toward the upside it must we do see the leadership challenge. annie: we are anticipating statement from theresa may round 10:30 are we knew that would happen anyway. boris johnson, the foreign secretary, has now resigned. interesting to see what theresa may said. what are her options at the moment? >> i think her options at the moment are to take a tough line, which is what we have heard she is doing.
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kind of saying, this is my plan. if you do not agree, that is fine, you can leave. aware they were not want to necessarily go at the moment if we are looking longer-term. otherwise, i guess she can also try to be a little more conciliatory with other brexit, people in the cabinet, given that johnson's high profile and him leaving will be a low. vonnie: diane, obviously, around the world, they will be watching this closely, the u.s., what does it mean that the turmoil is happening in britain? >> it is one more step. it is how much people are discounting until they see actions and what is going on. they really cannot place their bets.
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i think that is the lesson we have learned in terms of trade talks. there have been a lot of delays. the most critical issue is what do we finally see in terms of, will there be yet another delay, and companies are starting to make decisions be are we have some location issues. decisions made in the u.s. because of the fear of tariffs were people are deciding where they will boost production and cut production so, over time, it has an economic effect here difficult for traders to trade because these are not decisions, they are just threats of the moment. right, it is not a full change. a rebellion but not a revolution. vonnie: i want to bring out rob hutton on the phone. rob, i am questioning what the resignation of theresa may's top
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brexit official and now the foreign secretary in the face of boris johnson means for the u.k. cabinet and brexit going forward . is there going to be a coup with the brexit here at this point? >> that is the $100 million question. momentard to know at the . 24 hours ago it looks like theresa may had this all nailed down. she got her cabinet to agree and got the people who pushed for to dip their hands in and say they agree to her deal. as i was tossing out the list of the ones who have come out and spoken publicly, we hadn't heard anything today from boris johnson. now we know why. over the weekend, we were told my allies of debt by allies of johnson that it would be best to stay in the cabinet for a tougher brexit from their in this morning, the position changed.
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also let it be known that it wasn't resigning. late last night, said it would be resigning and that has changed the calculus for johnson as well. what it means, i think i still do not have the numbers to throw theresa may out. this morning, they were looking pretty cheerful. your point. i was down in westminster earlier this morning. what this means is dominic as brexit secretary, it is prewitt -- pretty well known he had his eyes on leaving the conservative party or could we at any point in the near future see a dominant grab leaving the conservative party through brexit? >> one hesitates to say anything won't happen. i don't see a path to that immediately. my main question when i heard
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rob had taken the job this morning was why would he do that ? if you want to lead the conservatives ideally, you need to win a vote in a party that is largely pro-brexit. a lot of hardline brexit people are absolutely furious with michael over the weekend coming out with theresa may's deal and equally furious. my immediate thought was that his leadership chances. my other question on who might concede her -- succeed her is is there a way to get rid of her? it is not clear to me that there are the numbers to do that. though it is extremely shaky. does boris johnson take large numbers of people with him? that is not clear. whatare very angry about she is doing. the intensity of the anger doesn't mean there are anymore. they still only have one vote.
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>> he covers the u.k. government very closely. just a final question on the pound to you, scarlet. we focused very much on brexit. it is also about expectations around the bank of england and where the. -- what the dollar is doing today. you are seeing dollar weakness. that dollar weakness trend has been going for a few sessions now. england,of the bank of we could see the focus switch way from politics to morals. that is on people are focusing on. we will get bank of england before that. >> thank you so much. vonnie. >> i'm here with our editor in chief, matt is with us. i wonder if you had seen the news in the last few minutes,
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boris johnson had resigned, what you think this means for the future, not just brexit but for britain and the cabinet? pound as at the leading indicator, or sterling. it is rallying. what that is about is so far, the theresa may government is continuing and it is continuing that she wants to have leading her initiative. it still does not tell us much about whether brexit and it is kind of a dysfunctional process, however, she hasn't lost turner yet. so i think that is where it is. >> -- it is amazing, her resilience. she has been holding onto power in spite of everything. we have a response from the european union. brexit is not
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solved by the resignation of the and, on hearing that boris johnson resigned, he says he can just repeat what was said. to do it is still the main problem. >> that is the biggest problem, with. we were close to a solution and now we are not. issuesne of the larger with nafta as well. negotiators that are inexperienced. it was one of the biggest issues with brexit. we do not have anyone who would negotiate a trade for so long here at we do not have experienced negotiators at the table. you are getting a lot of missteps and you will get more of those going forward here it is something we have to watch carefully. it is a pattern we will see repeated in our nafta negotiations as well. i am very concerned about nafta and now with the elections, it is easier for canada to walk ally given what we are asking of them and give him some of the
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negotiators in the u.s. including that, i worry about that. >> we have talked a lot about and resignations that have happened over the past hour or so, but we are still waiting for a definitive answer on the eu and what is known as a plan putting forward this week. does it seem like something the eu will welcome? >> it is hard to say what the eu will do. likessue of >> it is dealing with jelly. it is just so hard to get a grasp of. i cannot see it -- anything at the moment either on the eu side or coming from the u.k., as an experience at this point, that leads to any kind of conclusions. i'm sorry that i cannot get insight on that. they reactingen't
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more? we saw a very little move. very small. >> let's put this in perspective. it is two years on since the june 26 vote. at 133, somewhere around there. people forget the pound was at 140 before the vote. it is not like there has been a lot of progress here or at the outlook is brightening. the outlook has been diminishing and we are living with a diminished outlook for the u.k. and you saw that on the story on is bloomberg about where financial investment going at this point in europe? it is not going into britain. that is bearish. his historic have been a pillar of the u.k. economy. vonnie: we will continue to
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follow the news. plans to someexit extent. we are getting reaction from europe and a little running guided about changes but for the most part, do not think it will make any difference. theresa mayipating will speak at 10:30 and we will bring that to you live. diane.nks to matt and this is bloomberg. ♪
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nejra: this is bloomberg markets. vonnie: i am vonnie quinn. the big news is more brexit news . the resignation of theresa may's top brexit official. just a few hours ago, yesterday really. ,oreign secretary boris johnson
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we have a tweet now from the party leader saying, rob ellis boris johnson now, can we please get rid of the appalling theresa may and get exit back on track? sounds like at least on one quarter, there is an effort to topple theresa may. >> will be more interesting is to see exactly how the eu recommends this. according to eu in london, a blog on this, you can see across everything happening post boris johnson passes resignation on the bloomberg. what they are saying is that eu exciteds were a little but what is different about boris johnson is they will feel differently. some will be delightful -- delighted to see him go but are also worried about the destabilizing effect they have. it will be interesting to see which way to see the reaction. boards johnson cap a very -- campaign very heavily in his
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resignation seems to have come as a lot of a surprise. i was down at westminster earlier and was asking people if this is the beginning of the end for may and a lot of people believe -- seemed quite confident that it wasn't. we do not know if this was the first series of dominoes but the pound is maintaining gains from earlier. this initely taking stride. for the moment, i want to bring in our editor in chief, john. clearly there is an effort to at nott abandon the project if trying to do something else to topple trees in may, which is it? it must be attempt, by the stage, something rather suspicious, with the appearance of cabinet unity and some unpleasant things that boris said about the plan and then it is a stage thing. it has that feel little about the moment when michael has
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locked out in markets that -- margaret thatcher's cabinet. >> it is interesting because all of the characters have something in common but it is also very different. >> they're very different and the other thing to remember about force is he is not always the most organized so on this particular case, it could be a personal thing that he suddenly decided to do. there is -- you see any scenario to have enough muscle and what demand it from the public? >> they certainly have enough might to start a contest which buy it self causes problems. a more difficult situation because there is a large number of -- here with the parliament especially in the constituencies.
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notwithstanding wanted to problems, boris johnson has been popular. that is what he has been going for the whole time. they wanted to launch something against theresa may. if you look at parliament as a the labor ande there is not a lot of support for a hard exit. ask theu would have to question, mrs. is really have talked to -- this is really hypothesizing, but will we not say -- still be the same position? >> you have the exact same dynamic. a soft brexit if a brexit at all and a conservative party where the grassroots and a large core of mps one is slightly tougher brexit. do you want to carry the country or the party and those are the politics within it.
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>> great to see you. whencan theresa may see she speaks later to convince parliament she is still in control? >> like many of us, she is trying to rewrite what was said a few hours ago. her script has changed dramatically. as late as yesterday morning, she was tanking i can come out and say i have got the whole cabinet economy here she is now stuck with a much more difficult thing now losing boris johnson. there are dynamics within the. -- within this. that.y be like she may be able to do labour party or she did brief the labour party about some aspects about this. it here there is also in the background, a huge not just of anar election, but is actually of , as big abyn
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discontinuity for britain as donald trump as in for america. >> in terms of what could happen with treason may's's leadership going forward, i'm wondering, the appointment of dominic as exit secretary, is it taking things too far to think that he could be waiting on the sidelines to take over as leader of the conservative party anytime soon? >> he could be one contender. the secretary who became the remainder for the vote. that is generally being the most impressive perhaps of the various ministers they have got. basically, everything has changed. i think she thought she had an interesting script to put in front of people and now she faces all the different dynamics. the whole thing of brexit where you have to play to galleries at
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the same time, what has happened facing a life or death moment in the conservative party and can concentrate her mind on that and that made either sing -- the single thing that boris johnson has wanted to achieve. collects the brexit secretary gone. boris johnson secretary, gone. tweeting that now michael needs to go and of course, he is the environment secretary. play out the potential next best . >> it depends on whether they trigger a leadership. sitting there at the moment with a minority government reported, neither conservatives nor these really want to have a reelection at the moment. there are some people for which the brexit is just as fundamental as abortion politics are here. this is something they have believed fundamentally. he is also got his own group of
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supporters. more than 50 mps who are diehard and that is all you really need. >> right. you need enough. that is where the problems begin. the conservative party, there are two big things going on. one is the conservative party's instinct for survival. it is unbelievable. the conservative party is first -- ruthless i getting rid of people when it needs to. it is fantastically good having an amazing effect on britain over 150 years. the second thing is that brexit europe is the one thing it seems to be able to pull it apart. it was marred -- margaret thatcher's downfall, david cameron, because of having a referendum now. theresa may little all over again.
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europe causes conservatives unbelievable will difficulties. is the eug of europe, going to see boris johnson's resignation as positive? because now there are a couple way, orbrexiteers out a do they see this as destabilizing? >> europe is also stuck in this difficult thing until the weekend. among some people in europe, some of the leaders in europe to talk, that was a slight movement toward, it would be easier to .ave a soft brexit cut a person a little bit of slack. that was going on the one hand. on the other hand, there was a force which is italy. italy is an existential problem of the european union. within the european union as well. italy causes in our midst of both these which causes people
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like macron and merkel, it changes the problems they had. the whole project was to unite the eurozone. and now it is appended. >> john, thank you so much. we just need to go to theresa may now who is speaking in parliament. theresa may: will join me in extending deepest condolences to family and friends of john, passed away last night -- last month. there were originally to establish full fax in what is now a murder investigation. i want to pay tribute to the at theion of staff district hospital for their tireless work in responding to this thoughtless crime. the home secretary will make a statement shortly, including on support we will continue to provide to local community throughout this difficult time. joining me, i want to pay
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tribute to my friend, the members and -- for their work over the last few years. we do not agree about the best way of delivering our shared commitments to honor the referendum. i want to wreck masterwork of the former secretary of state for the work he did to establish parliament and steer through parliament for the most important legislation of generations. and to recognize the passion -- in promoting -- >> order, look at the unseemly atmosphere. i want to hear about these
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important matters. >> thank you. world leavinghe the european union. i'm pleased to welcome my honorable friend, as the new secretary of state. speaker. a comprehensive ambitious proposal for an incredible basis for negotiations for the eu toward a new relationship next year. it is a proposal that will take back control of the borders. that protects jobs and allows us to cite new trade deals for an independent trade policy, to keep our people safe and the union together. i want to start explaining why we are pushing it forward.
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negotiations so far have settled and itthese agreements will provide businesses and governments the time to prepare with the eu and to make sure that relationship, they are simply not accept book. first, what is provided for in the guidelines for march of last year, this amounts to a's and are free trade agreement off in separatedustoms union through a border in the irish -- for the u.k. internal market and no prime minister and united kingdom could ever accept this. it would be a profound betrayal. some might know propose instead it should agreement for the u.k. is a whole, it is not for us to meet our equipment -- there should be
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no hard border between northern ireland and ireland. secondly, there is what some people would say is on offer from the eu, membership of the european economic area but going further in some places, and remaining in the customs union for the whole of the u.k.. this would mean continued payments of the eu for assets, a continued obligation for the eu law, no independent trade policy with not unlike our trade deals around the world. i firmly believe this would not honor the referendum result. the eu continues on this course, there is a serious risk to -- that it could lead to no deal and it would most like be no deal without an agreement on future relationship, i cannot see that the parliament would approve the withdrawal agreement with the protocol and financial commitment and without these commitments, the eu would not sign a withdrawal agreement.
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a responsible government must prepare for a range of potential outcomes, including the possibility of no deal. including the possibility of no deal. time remaining before the conclusion of negotiations, the cabinet agreed on friday that these separations should be set up. as the same time, we should recognize that such a no deal would have consequences for the u.k. and the eu and i believe the u.k. deserved better. the agreed we need to present the eu with a new model. involving what i set out in my speech so we could accelerate negotiations over the summer, that new relationship in autumn, past the withdrawal bill and leave the european union in march until 19. the friction free movement of
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goods is the only way to avoid a hard order to north island and ireland as between northern ireland and great written. written.great it is the only way to protect supply chains and just-in-time processes on which millions of jobs and livelihoods depend. our proposalrt of is the u.k. eu free-trade area which will avoid the need for regulatory checks at the border and protect those supply chains. requires foris spear that is the commitment to maintaining common rule for industrial goods and agricultural project -- product spirit of the eu would make an upfront choice to submit ongoing harmonization with the eu on goods, covering only those necessary to provide frictionless trade on the border. necessary to ensure free flow -- free flow at the border and it would not include the agricultural policies which the u.k. will leave when we
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leave the eu. the recommendations are relatively stable and supported by a large share of our businesses. we continue to play a strong role in international standards that underpin them. it would be a parliament to wait -- parliamentary lock on all rules and regulations and when we leave the eu, we will end the effect of the eu law in the u.k. , laws passed in westminster and belfast. we would have the sovereign ability to reject heavy proposals if it's so chose, recognizing there will be consequences including for market access if -- if we had that approach for eu. under our proposal, the u.k. and the eu would incorporate strong -- we will establish cooperative arrangements between regulators on competition and commit to maintaining high regulatory
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standards for the environment, climate change, and consumer protection. they would need to join the -- theframework for a interpretation and application of the eu agreement by those parties. andould be done in the u.k. in areas by eu corpse where the u.k. continue to apply a common rule book. this suit also provide an appropriate means for the dispute, including the establishment of the joint committee of representatives from the u.k. in the eu. it would respect the autonomy of the u.k. and the eu leader -- legal orders than be based on the fundamental principle that the court of one policy cannot resolve disputes between the two. it also agreed to put forward a customs model, a facilitated customs arrangement, which would remove the need for customs
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checks and controls between the u.k. on the eu because it would operate in custom territory and would also allow the u.k. for -- to have an independent trade be theand the u.k. would policy for the u.k. and the eu's trade policy for the eu. businesses would be able to pay the correct tariff war no tariff at the u.k. border so there would be no burden compared to the status quo and they would then if it from the new trade deals we would strike. we would also bring forward new technology to make the customs as smooth as possible for those businesses that trade with the rest of the world. that under this arrangement, the u.k. would not be a will to do trade deals and they are wrong here when we left the eu, they would have their own trade policy with the trade organization for our trade with the rest of the world.
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produce for our partners and on friday, and the comp progressive agreement for transpacific heart the ship. planpeaker, our brexit respects what we've heard for businesses about how they want to trade with the eu after we are best we ensure we to capitalize on the future in line with our modern industrial strategy. our proposal also includes a far-reaching partnership that will ensure continued cooperation while enabling us to operate in the foreign defense. it is not just a plan for the british job for our home and in europe. is consistentthis with the commitment made, and it is. union, thee european
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single market or the customs union, we will seek a special partnership including a comprehensive free-trade and that is exactly what the proposal agreed for the cabinet seems to achieve. what we are proposing is challenging to the eu. [laughter] theresa may: it requires them to think again and look beyond positions they have taken so far and agree on a balance for obligation. that is feel me way to meet our -- meet our commitment without damaging the integrity of the u.k. what we established in some of the world's's largest security partners, it is a bold proposal
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thursday andut on we now expect the eu to engage so that we can get the future relationship, i firmly believe it is in all of our interests. in this referendum, we have had is bearded national debate. with robust views echoing around the country. this is the right brexit. --h of march and ends with the jurisdiction for the u.k., no more
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eu instead of the priorities like our long-term plans. flexibility on service is where the you a is world leaving, no heart between northern ireland and great britain. rules and regulations. the freedom to fight new trade , but notund the world the distance -- distant relationship. and continued security cooperation -- it is the dresser that will deliver on a democratic decision of the british people, it is the right brexit deal for britain and i commend the statement to
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the house. >> mr. speaker, i want to thank the prime minister for the advanced copy of this statement and share her condolences to the friends and family of don. we are two years on from the referendum. >> that was prime minister to resume a making a statement in the parliament for the house of commons. she was succeeded by jeremy corbyn. to get some reaction, let's get back to the editor-in-chief with us in new york. john. that did not seem to me like a prime minister who was worried about being outed just judging by her tone. >> yes. on two different levels. it was interesting how everything got in. everything began with island. that is just the place that has made all negotiation incredibly difficult. on the one hand, they cannot find an answer that deals with have theireland and
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border with the european union. in terms of her body language and things, i thought it was relatively strong. there was an element of her giving the exact same statement she would have given his boris johnson have remained inside the government. the consequences of that i think are still being sorted out. who, they have to stand up especially when standing with a bunch of men, as a whole, i think she's a pass to go through that and she knows that jeremy corbyn is in the all position, that she is not out of the woods by any means. in the end, it comes back to her party and whether that is prepared. >> what a way with words. a single woman standing up and bunch -- if i have a bunch of vain men is what it looks like. with me on set.
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we see sterling weakening. that is where we trade down .2%. it took a little while to react to boris johnson's's resignation. what specifically about the latest developments is concerning sterling traders? >> as outlined, it is a question of whether boris johnson will in then a modest way sense of actively pushing against what the camera has decided and is in very complementary about his replacement so far here at we do not know yet what boris's plans are. the third member is michael. and he did turn up finally, he was waiting to come in. it would have been perhaps better for the prime minister but at least he was there. i did not see much positive by language for people like lynn fox. there were nods or cheers going on. a little worrying. rather anxious. force johnson's
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secretary, standing in a sense that will calm things down, the two people should probably most wanted to leave, it was probably a body bag summit, would be boris johnson. in some sense, probably just strong enough to do it. if she gets through the day, she will be much stronger for having done it. inspiringave a sense -- spiraling completely out of control and it will really be quite serious. >> we have seen a shift in money market pricing in terms of the rate hike for august. is that a little bit of a stretch? >> it is very up in the air. until -- we won't know exactly. right. john. there has not been an official call for theresa may's departure yet. is a woman saw taking a long time to make up her mind. he cuts she sat there listening to all the different plants here you could argue it has been
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and the reason the country is muddled, is still a lot of support. i do not think it will cost jobs and things. trying to deal with these contradictions. the one thing is the single strongest thing she has going for her. it is very difficult to think of someone who could come in and automatically answer all of these problems. the leadership people always say they want to be a leader but not quite yet. he likes to point out to remind people, there is still an opportunity to stay in the european union and he just tweeted out something to that effect. thank you so much to john and marcus. let's get back to westminster and pre-and u.k. lawmaker who joins us.
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great to have you on the program. resigning --son is is that the beginning of the end for theresa may? >> i do not think it is and do not think it should be at the way in time. incredibly important negotiations with the european union, guess what, a leadership election in the conservative party takes exactly three months. it clearly will not work. i think theresa may must stay and i think she should stay. >> what happens next in terms of the approach for brexit? do you think we will see more resignations? >> it is very hard to tell you the answer to that. my hunch would be no. but, i wasn't expecting to see boris walk. what i think happens next is she ended up replacing already the
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first cabinet minister already this morning and will replace boris johnson, presumably, by tonight. and she will have effectively, loyalists in her own cabinet. she will have people who actually agree with her form of brexit, the overriding issue in the u.k.. this could in the medium long-term work out better for theresa may today, it will be incredibly tricky day dealing with that at the top of the government. outerhaps you could throw potential names as successors to boris johnson? thing over thee a fewthat has been quite reshuffles, in other words, people have resigned, unexpected reshuffles. i have never been able to work out quite who will go in. theresa may tends to do something a little less -- when
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it comes to appointments reshuffled. >> 129 of you voted so there is a dwindling number of people to choose from of who might do the job and keep on the ideological spectrum. >> yes, there are a lot of possible names. there plenty of prominent governmentand around , so she could easily move one of those into that position. the whole exit negotiation, believe versus those who want to remain, those issues have made it far more calm -- complicated for a prime minister. another might have been if boris johnson devotee. but she probably cannot do that
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because she does cause an extra layer of complications for the prime minister. >> are we heading for a soft brexit? >> i actually went for an interesting to our briefing last night just before the news about davis's's resignation broke. if we end up with that version of the brexit, i would not call that soft. completely out of the eu. >> thank you so much. this is bloomberg. ♪
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which could save you hundreds of dollars a year. it's a new kind of network designed to save you money. click, call or visit a store today. >> it is 11:00 a.m. in new york , and 11:00 p.m. in hong kong. 30 minutes after the trading day. vonnie: from new york, i am
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vonnie k. and mary in london. close.""the european ♪ vonnie: here are the top stories we are covering from the bloomberg and around the world. brexit below, theresa may faces another defection. boris johnson stepping down. we look at how the markets are reacting. >> more trade tension, a meeting with angela merkel with a trade one in for president trump. of we will hear from the ceo the largest chemical company about his plan to invest in a second complex in china and how trade impacts that. ok,

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