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tv   Boom Bust  RT  May 22, 2019 3:30am-4:01am EDT

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after the previous stage of my career was over everyone wondered what i was going to do next the multiple different clubs on one hand it is logical to sort of go from fields where everything is familiar on the other i wanted a new challenge and the fresh perspective and i'm used to suppressing. for the experience. i'm going to talk about football. or else you can see i was going to do it. by the way what is it that. this is boom bust broadcasting around the world encumbering the world of business
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and finance and the impact upon us all i'm daniel breda in washington and i'm pretty i straight ahead on the program today the u.s. and china are ramping up on trade rhetoric as markets are reacting to the move tom gandalf the 3 bridges financial and todd are with the trading are on board to break down the campaign down mate and how global markets are faring. ford is scaling down and putting thousands of jobs at risk was at the all over the world but there's a place for the hope for auto stocks trapped in the terms of the cold coach of the wheel when we take a spin through all the markets across the world all that directly has the let's dive straight in. a delay on while ways blanket ban in the united states leads our global report today as a trombetta ministration says it will give the u.s. companies 90 days to stop working with the chinese tech giant 4th of year penalties kick in this is a temporary reprieve for a while way after the white house announced the ban last week the additional detail . on the highway ban will be published by the u.s.
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commerce department on wednesday u.s. companies will be granted a temporary general license to work with huawei and apply for specific licenses commerce secretary well ross said the grace period would allow u.s. companies to wind down transactions and arrangements with holloway with less disruption on the other side and effective ban on purchasing u.s. made components with severely impact huawei while weighs the wrentham phone responded with bravado dismissing both the ban and the delay saying the current actions by american politicians underestimated our power here to tell us more where joined by r.t. correspondent sara montana's they all welcome thank you so all given all of this how how does the trade war and the escalation of the tensions affect between the 2 countries that we've seen in recent weeks well basically on tuesday like you said the u.s. commerce department announced that it would postpone it and add a 90 day extension before actually banning out wall way now this what we is
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technically still prohibited from buying american made hardware and software in this really hurts a lot of american businesses who up to spend up about to meet a $20000000000.00 of semiconductors each year so it's hurting world markets but when this extension was announced earlier to you earlier today the markets did go up a little bit so it's kind of a a ceasefire if you will to give them time to make other arrangements and mr trump of the had to have this option to ban wall way on the table for months now but had been prolonging it until he felt like he really needed to use it. so you mentioned you know sort of the feeling is that this is may be sort of on hold sort of a bit of a thing it's. just sort of a way to gain leverage amount larger trade fight how do these sort of 2 tracks really really intercept or how are they separating all sources familiar with the trump administration that again trump had postponed this decision and this is only
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$12.00 weeks ago we were hearing that they were so close to reaching a deal and they had it and even the chinese that ministry of foreign affairs spokesperson said the u.s. was really misusing their state power to hurt foreign nations take a listen to what he said. leave voluntarily the u.s. uses state power to crack down on foreign companies and to interferes in market behaviors and frankly it will not be in the interests of the u.s. itself the so-called mutual benefit of trade means that all industries keep their markets open and seek overall reciprocity and balance of interests it is on scientific and unprofessional for the u.s. to simply think that it is always the one suffering losses in our trade relations therefore we cannot claim absolutely quality in all areas during trade negotiations but an agreement must create a 2 way equilibrium they're talking about equilibrium here and founder of wall way also issued a statement in chinese state media where he was interviewed saying the current practice of u.s. politicians and i'm sure makes our strength while we 5 g.
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will absolutely not be affected so he's saying that they have a plan b. that google right now is working with wa wait during this grace period if you will to find a solution but this will affect a lot of huawei users they will no longer have access to g.-mail or you tube or even google maps so again it's a really having an effect and to have an impact on people worldwide who have only rely on a long way and use what way and will discuss as more but you know people are already saying maybe overblown but people are comparing this to a sort of iron curtain a sort of world divide people have to decide perhaps on the internet you go with the chinese infrastructure or u.s. infrastructure absolutely and the people are very split with the 2 camps so definitely a story to follow up on. thank you so much for joining us thank you. and for more on how the trade war is affecting the markets we're joined by todd bubba horwitz above the trading and founder of 3 broad and c.e.o. of the burgess financial tom gandalf the thank you both for joining us. now tom
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listening things are great there you know it seems like people are sort of speculating assuming that this wall we move is just about leverage in the trade fight china seems to have on their side found another pressure point a leveraging point. they're the world's largest supplier of rare earth minerals accounting for 90 percent of global production and the u.s. relies on 80 percent of their imports of those rare earth metals coming from china obviously very important to high tech industries electric vehicles when cell phones and the trump administration did not include notably did not include these materials on the latest list of terrorist targets due to that reliance so how big of a point is this for china showing that they can squeeze outside customers foreign customers on this critical input in the tech industry what do you make of the situation and who's going to lose out if these tensions escalate. well like most everything else that's related to the trade war everyone's gonna lose out eventually in some capacity in the trade war and till we get
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a resolution that's beneficial to both sides there's going to be a little bit of give and take for sure rare earth minerals are certainly very important to our tech industry and while it's true that chinese the chinese are leading in production there are a number of other countries that trump has buddied up to recently that have significant stockpiles brazil and brazil is one they've got the 2nd largest stockpile in the cunt in the world minerals india's got significant stockpile as well as australia so certainly the chinese are looking for someone never ridge and the reason they're having to work for leverage is because ultimately the u.s. has the trade imbalance and the u.s. is chinese china's largest customer that is the ultimate leverage and that's what the chinese are trying to counter in my estimation. and this question can go to either of you but i'll direct it's a bugger for now because you deal with global markets obviously commodities are
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traded on a global basis but it's people are just speculating now that if you have a world where the largest chinese tech manufacturer can't get u.s. components and u.s. makers can't sell them that you'll have essentially an iron curtain to internet world is that even possible in a world where commodities all commodities imaginable are extra traded all around the world what would that world even look like baba. well i think when you look at it i mad that it can go either way i mean it can be done separately or could be done together now again i believe they're going to eventually work something out and do something together however if they don't i think china ends up being the bigger loser i think more of the things that develop this country and of course a lot of their stuff is been built on the ceiling of intellectual technologies and you look at the commodity space the only reason that commodities are. right now are priced lower than they have been in years is because of the oversupply it's just a simple supply demand curve it really has not
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a lot to do with the tariffs or what's going on between the 2 countries at the end of the day between the 2 largest producers between brazil and between united states of soybeans there has not been a crop disruption in 4 years so we've continued to stockpile him a dory so no matter what product you have no matter what trade we're going on there's going to be a lower prices and i think the trade wars right now have been just an excuse for the politicians the lobbyist to try to push something through versus what's actually happening. i'm wondering how companies will actually make their choices in a post while way band scenario we saw google actually respond very quickly by cutting off its cooperation with way on the android operating system but the ban really isn't acted by the u.s. and that's a very big question mark what can u.s. companies do well while idea to adjust to the new scenario now reports right now that are saying that has already been planning for life after google by telling their app gallery as an alternative to google's place to are to take one for
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example. you know i agree with what's already been said you know the chinese have a lot to lose here as does the u.s. certainly as it comes to. trade bans and all the saber rattling that we're hearing here and a lot of that is police scuse me political positioning in my opinion and it's political positioning in an effort to get a deal both sides need a deal certainly if wall way. sort of goes it alone and some of their own or indeed developments in some of their own production in the u.s. companies we're going to feel a pinch here certainly some of the bigger companies qualcomm is one that over the last few days is the news that broke that are going to struggle somewhat corning is another that could have some some problems. but ultimately huawei needs customers and the u.s. is the largest market in the world so sooner or later i think business and
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government will both find a way to make this work we do have a problem here that really is sort of hanging over the entire situation is that we have systematic differences between the u.s. and china the chinese have a state run state dominated economy so their companies are actually heavily influence or directed or owned by chinese government in the u.s. we have private business so certainly there are some different interests in mind here but the u.s. is taking the steps that it needs to they feel that they need to take to protect the interest of the country and the chinese are doing the same for themselves. on the back of that chinese right now is also being defensive they're becoming increasingly less reliant on u.s. imports turning instead to brazil to fulfill its soybean demand an estimated $5500000.00 tons of soybeans traded over the past few days boosting premiums to more than double the levels seen earlier this month so china right now is sending
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a clear message that it doesn't need the u.s. what about buy surprise that can the u.s. if we find it necessary imports elsewhere. the u.s. can do fine without china china you know i've been doing this for 40 years and whenever there was a problem a story because of price the chinese are buying they don't buy there's plenty of customers and one thing we have to remember is the the population of the world at 10 years in a row there's a need for food there's a need for soybeans and for corn there's a need for a week and again but as i said earlier the one biggest problem right now is there has been no supply disruption for over 4 years that has created dramatic supply the minute that starts with one ball down all the sudden the price the man of the wire and believe me china is going to have to buy us beings whether they are buying through argentina what they buying through brazil where they buy into somebody else they're going to maybe you are soybeans and u.s. grain. because again there's only so much supply this isn't an unlimited supply and when the supply runs down and they can't buy it from somebody else they're going to
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have to come to us no matter how they get them they will find a way and i know they've already bought some through the back door to begin with. so right now today looking at the relief rally it seems so temporary and right because right now as we said this is only a temporary 90 day grace period that the u.s. tech companies have before they start winding down their operations with way now it really does seem like the trump and ministrations just play a little cat and mouse game with the markets what do you think of this relief rally . i don't really think it's a cat and mouse game i think that the trump administration not only wants a deal with china and they're trying to do what they think that they can do to kick the can down the road just a little bit you know trying to be meeting with. about 30 days at the g. 20 i'm sure they'll have some dive and some conversation i think that both sides absolutely recognize that something's got to get done and you know both the u.s. and china ratify whatever cages they can china doesn't have as many cages to rattle and that's the cold reality or above to mention the soybeans of why he's absolutely
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right there are plenty of customers china needs the u.s. and ultimately they're going to have to figure out a way to come to grips with the fact that they've got to do business with us and we need them as well don't get me wrong this isn't a one sided affair but. deals got to get done in china recognizes that real real big interest for both sides to settle this tom gandalf you have 3 bridges financial and bubble here where it's above the trading thank you both very much for your time and i do thanks for having. the time now for a quick break but hang here because when we return ford is failing back putting thousands of jobs at risk. the car coach grabbed the wheel and we take a spin through our own markets across the well and as we go to break here are the numbers at the closing bell.
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situation. is still. a problem in venezuela is not that socialism has been poorly implemented but that socialism has been a template for. different sanctions against. some of the moment. that at. the. top of the. henry kissinger. social system could take hold and therefore the.
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economy scream. in the. business world. coverage. welcome back u.s. energy secretary rick perry says legislation that places sanctions on a controversial north stream to pipeline project will be elected in the not too
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distant future secretary perry noticeably chose to make the prediction about the russia germany pipeline in kiev while attending the inauguration of a new ukrainian president volodymyr so lewinsky mr perry flatly flatly predicted north room to sanctions legislation quote is going to the president and he will sign it according to reuters mr perry's host the new president mr zelinsky told for mr perry to push for increased sanctions those sanctions if and acted would add to an existing list of significant u.s. sanctions against russia but comments from officials of all involved in the nordstrom to project seem intended to convey an attitude somewhere between concerned and keeping their eye on it. the u.s. imposed sanctions against the venezuelan government have had an enormous negative impact on the country's economy the measures derived from private about access to international financial support and investments in its oil sectors it's no surprise that the new bolivarian got republic would try to find an alternative to the dollar
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for its international transactions last october they announced that venezuela would denominate oil transactions in europe not dollars and then in december the country disclose that they're working on a national crypto currency the peg to the value of the venezuelan oil essentially using crypto as a means to circumvent u.s. sanctions today and russia are in talks to use the ruble and the l. petro in mutual trade settlements as another medium of exchange this is a big step in abandoning the commonly used u.s. dollar and country to country transactions and then as one of the hopes to avoid sanctions by disconnecting from the us dollar and the petro is an integral part of the process. since the petro is paid to a barrel of venezuelan oil it will be like swapping crude oil for imported products for russia this is also beneficial as it will increase the use of the ruble in international trade and it will allow the ruble to shift from being a convertible currency into a reserve currency. department store well as continue as u.s. based calls and j.c.
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penney both reported incredibly disappointing earnings reports for the 1st quarter of this year kohl's announced tuesday that sales of existing stores fell by 3.4 percent in the 1st quarter versus expectations of just a point 2 percent fall shares of coal fell by as much as 13 percent on tuesday on the news j.c. penney on the other hand reported a net loss of 46 cents per share on sales of $22560000.00 versus expected losses of $0.38 per share on the same revenue on the news penney shares were trying to trending down 8 percent and in another hit to the retail clothing game a center retail group announced monday that they would be shutting down $650.00 dressed foreign stores in the united states dress martin chief financial officer steven taylor said of the decision this decision was difficult but necessary as a dress barn chain has not been operating at an acceptable level of profitability in today's retail environment following the announcement of the disclosures
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a center retail group's stock was down more than 5 percent meanwhile despite weak earnings for these department store giants and the closure of a large chain mainstays in the sector macy's nordstrom and dealers just between one and 2 percent. of those the retail sector continues to take big hits the auto market is also seeing its fair share of rocky roads ahead to help us break it all down is lauren 3rd it's the car coach lauren welcome back. thank you for having me lauren let's just get right to it ford is back in the news again and not for the right reasons according to the company it will be slashing 7000 jobs worldwide that comes to about 10 percent of its salaried workforce they say this restructuring will save about $600000000.00 a year and while it's certainly going to impact workers in north america half of
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the cuts also will be distributed across south america russia and europe how has this 6 impacted the company's stock and what do you make of this move doesn't make sense going forward. well it's a cost cutting measure and we're looking at about $900.00 jobs happening this week they're going to be salaried employees it'll be let go you know they have a lot levels of multilevel management so if you've got too much management and not enough people actually making money for the company you have to get rid of some of that access and that's what they're looking at right now some of these older large corporations have many levels of management if you're looking at general motors or a few at chrysler and so they've started to whittle that away so they've got to keep people in key positions and less management teams underneath them where that's really going to be totaling over a period of years or according to like morgan stanley saying $1750000000.00 and that savings should help their stock when they made the announcement the stock actually went up and so today it's been pretty flat but it needs to go back to where it is my personal opinion is i think that the current c.e.o.
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is all bent on going full electric and autonomous and i don't think that's going to happen they need to look at where their big money is their bread is buttered with series pickup trucks and largest. full series of s.u.v.s and they're doing that but they need to really focus on producing products that consumers want and electric vehicles are just not selling here i'm assuming and this is my prediction that in the near future you'll see joe heinrich's as your next president and he would be fabulous now onto a small ramp positively in positivity in the market and i think trump has said that he would delay implementation of auto tariffs on vehicles from the european union and japan in particular the auto industry has come out pretty strongly against president citing complex global supply chains for cars what do you make of this tariff delay and how are companies that reacting to this. i think that tariff delay is a good thing we need to start getting this north american free trade agreement back together again it's good for mexico it's good for canada we have vehicles being
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built in both locations and a lot of that is a lot of movement from the supply chain going across all 3 countries what's really important is that both canada and mexico agreed to not do or tell you tory tariffs we both agreed to scrap them and that will help make it so that it's easier to transport materials across the country lines also that $180.00 day delay is also good for that but it's what it does do is it impacts europe and they're going to have to step up and reduce their tariffs because they're not part of this and they're going to see some big changes and i know that china is eventually going to have to bend to working out a deal with the united states because otherwise it's going to hurt their economy even further and they're and we can't let you go without talking about their shares have yet again and the company stock is now hovering around $200.00 but just 5 days ago it was at $230.00 what are your predictions for tess not going forward. i think we're going to have a 2nd quarter loss with tesla i mean it's great to say that he's got all these great ideas but people realize that this insurance company idea that he has is
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great only and idea only in order to get an insurance company approved you have to go through a lot of government hurdles and be on that check you have to be able to to get a reinsurance company to back it up we're not seeing that plus the fact that we're looking at a product that's not being purchased they have lost their federal tax credit here in the u.s. and across other countries they're no longer getting that same drive because you've got competitors such as jaguar an audi and mercedes really taking up by chunk of that business i think we're going to see a 2nd quarter loss and are going to watch that stock drop well below 200 and there's a lot of predictors that are that way it's not just me anymore i was the 1st one to call it but everyone started jump on the van wagon and we also want to ask you before you go quickly about maven which you would probably haven't heard about yet but was attempt to get into what they're calling car sharing service not quite wide healing but car sharing they're ending operations about half of the markets they were in what did you make of this move the deciding to get into what they call car
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sharing and getting out is this is such that they can eventually succeed in or was this just not a good idea to begin with. i think right sharing sounds great nischelle lead but we have rental car companies all over the place people don't typically want to share their cars i mean you probably wouldn't want to share yours because people don't take care of their vehicles the same way you would take care of your own vehicle and so you're finding a lot of people not really taking on to that they like goober they like live for looking in other countries but here in the united states it just didn't take off well in new york and so they're only going to keep open detroit and los angeles for now i didn't think it was a great idea to begin with they just don't see a big drive toward ride sharing right hailing is different that's why you you know hail a cab or hello car service but this is i just don't think this idea is going to work out so well because there's way too many other factors that consumers don't feel comfortable with it may not even take good grips anywhere or for that matter right brings you back to that old saying nobody washes a rented car right. exactly well abuse them lauren good cigar coaches always thank
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you for your. thank you. and finally with the trade war escalating and the terrorist being felt most business owners the people of china have rallied behind a song to express their frustration with the u.s. the privately produced song trade war it was written by sally and can and it's going viral on chinese social media everywhere the song is set to the tune of the film tunnel war in which a chinese town defends its home from japanese invasion dallas' said tunnel war is reminiscent of a similar situation that china is facing today and it reminds of people to stand strong in the face of conflict.
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what sounds catchy i can see what's going on so this is actually a list that was found on chinese social media everywhere it started on we chat and essentially what they're saying is that this is actually a people's war because in the u.s. as well the consumers are and the business owners they have the brunt of the tariff burdens so this isn't president trump where he doesn't feel anything it's more of the business owners who have to like pay higher prices for their goods consumers who now we have to pay like double sometimes to get imported goods and this is been another theme that in the reporting the chinese leaders are themselves apprehensive about stoking this too much because they think nationalism could get so strong that it actually could tie their hands and make it more difficult to make. you know deal with trump that may not look as good to the public if it were in their interest fascinating that's it for this time you can get boom bust on direct t.v. channel through turn one dish network channel to 84 streaming 247-3651 pluto t.v.
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the free t.v. channel 132 or as always have us up to you. dot com slash 2 must r t c next on. the lake says and see it forms part of a high altitude nature reserve. it's one of the famous chito room indonesia's principle which a way starts its journey. but it can be summed up one way to the top to bottom i got a septic tank stop. it runs 300 kilometers from source to mouth and there are over $200.00 industrial facilities ranged along as banks. i'm out on
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your muscle. to do 3 things. i might get out of them and to be in. the room here again scuba 4000 rice fields and supplies drinking water to 25000000 people. that's a moot point yes of course so married by so many of us about us remember all the other people. i. was.
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up. i. frustration and anger both in the u.k. and europe as prime minister to resign made tries for a 4th time to get a bricks at the all over the line at this time with a promise to peace to hold votes on a 2nd referendum if they choose to back in. the u. elections just around the corner tech giants say there's no sign of any russian interference despite much media and political hype to the contrary. as the race for the 2020 us democratic presidential nomination he. me of rivals are intensifying with hope for the branding she's been getting donations from kremlin stooges as fake news.


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