Slowing. Is said to be china is trying to funnel more credit to private companies. We will assess the implications in beijing. A quick check of our markets close in the u. S. It was a bit of a mixed picture. We saw the dow gained 50 points. The s p 500 erased this mornings gains. Fed officials with a little bit of caution about future rate cuts. To mention we have some soft manufacturing pmi numbers. That did not help sentiment. Cared materials and Health Leading the declines after fluctuated between gains and losses. That fell 0. 4 . U. S. Futures at the moment not doing much. The focus right now is on jackson hole. Lets see how we are shaping up. Steady as we go. Asian futures not doing much when it comes to the potential for how cash trade may start. We are waiting for cues from jackson hole as well as the g7 meeting this weekend. We also have today a busy day of earnings from china as well as from hong kong. We are going to get a cbi data from singapore. Thise checking on the end morning. The end looking a little changed. 10645 against the dollar, at a 2019 hi. We are seeing bonds remain under pressure with yields up in new zealand. Australia, the aussie 10 year yield rising five basis points. Getting closer to that 1 level here. We are going to see whether this momentum can stick as we hear from jay powell later this weekend. On checking on whats going with bonds, traders on high alert after that inversion between the biggest in a week. We have seen a surge in puts on treasury futures. That is a multiyear high as we have markets anticipating rates could be bottoming out. Thanks for that. Lets check on the first word news. The feds jackson hole symposium threatens to reveal widening divisions between policymakers. Jerome powell is under pressure from President Trump to cut rates. Least three regional fed bosses have told bloomberg they opposed the idea. Andons Eric Rosengren jackson hole host kansas citys all say this is not the moment to cut. As i look at where the economy is, it is not time. Im not ready to begin to provide more accommodation to the economy without seeing an outlook that suggests the economy is getting weaker. U. S. Aviation regulators are said to be using inexperienced pilots to test new Flight Control Software Designed to help the boeing 737 max 8 return to service. We are told the faa wants to find out how pilots with only one year of 737 experience with at least one max flight relate to the reacts to the update. Sources say Simulator Training has been pushed back a week. Sales haveetail plummeted this month. That is as street protests inflict damage on the local economy. Retail Management Association is calling on landlords to cut in half for the next six months and wants the government to provide relief measures. The value of retail sales dropped 6. 7 in june from a year earlier. Cautioning staff amid tha use of social media could be a breach of rules after staffer found to have taken part in hong kong protests. Employees posting or it has told employees it could any employee involved could be fired. Global news, 24 hours a day on air and tictoc on twitter powered by more than 2700 journalists and analysts in more this is countries bloomberg. Lets head back to wyoming. Kathleen hays is standing by with a guest with decades of experience. Kathleen . Kathleen thank you so very much. Is the former governor of the bank of israel. He is chairman of the board of trustees of the group of 30. Chairman of j. P. Morgan chase international. Importantly, this is his 35th Consecutive Year as a Kansas City Fed symposium at the jackson lake lodge. We think it is a record. So they say. Symposium our annual chat. Donald trump criticizing the fed. Jay powell and his colleagues making a very important decision. About whether to cut rates again. What does this mean . Does it really impinge on them somehow . I dont believe the president of the United States should in thene and interfere conduct of Monetary Policy. The Federal Reserve has had a spectacularly serious responsible record and they know what they are doing. Obviously, it is not helpful. Knowing chairman powell and the rest of the committee, i believe they will continue in their professional analysis and make the decision based on data, based on analysis. The problem is not what they do, but how the markets interpret this kind of intervention. The more there are such interventions, the more the market will realize. Kathleen uncertainties caused by global development. That is the fed speak way of saying the trade war. Worse,a little bit didnt it . Just today after the fed cut its key rate, august 1, President Trump tweeted he is putting more tariffs on china. Economy andk at the the need for the fed to take out an insurance cut because they are worried about that, is the situation still with us . Jacob there is a huge amount of uncertainty. Most of the uncertainty is coming from the trade war or developments in europe. The decline of china. The recession in germany, italy, brexit, you name it. Be andse things cannot should not be by Monetary Policy. The trade war is important because it affects sentiment. If you look at the business sector and you ask, how is your sentiment . They will tell you the trade war or the uncertainty from it is affecting them in a very negative way. When you look to the u. S. Production in general, you will see it is reasonably ok. Manufacturing is not ok. Investment is not ok. Why . There are these degrees of uncertainty. After all, the corporate sector did make a very positive move for business sentiment. Why spoil it . Now youre talking about the next fed meeting. The fed has made a point of having their decision datadependent. Whats the point of announcing today, what do you think will happen to Interest Rates when you know there is a lot of data . You think jay powell will be cautious tomorrow . He should be cautious. In fact, most of his messages in the past presentations emphasized the issue of caution, the issue of going slowly, the issue of data dependence, things of that type. Why to pressure . Why to rush . Think the fedou will cut the key rate . Jacob without question. What the fed should do and what is expected decision of the fed, forecasting what members of the fomc will decide, it looks like there are sentiments to cut rates by 25 basis points, but i would urge everyone to listen carefully to the argument of those who are most skeptical about it. They have serious arguments. The fed today,t it is not equipped very well to deal with the next recession. Low,Interest Rates are so this is not the place you want the most important instruments of Monetary Policy to be. Youre talking about guidance. Youre talking about this and that. Things we defined yesterday is unconventional. You want to make them conventional . After all, they are not as effective as the most important instruments. Insurance against the next recession, i talk about gourance about having to to the battlefield. I trust the fed will settle it. It is not through pressure. Lets face it again. We talked about the fed. We talk about Monetary Policy because we are at jackson hole. There are elements in the market today not determined by the fed. It is the elimination of the uncertainty of trade war, of things that are selfinflicted. Just look at the 1930s. Dont go this way. This increase in negative bond yields, five years ago, there were none. It started picking up. It is quite large now it seems to keep growing. Sell a had germany just 30 year bond with a negative coupon. What is driving that . Jacob it does not seem like normal to anyone. We should ask ourselves, how do we get out of this syndrome . We need to get out by activating other elements of Economic Policy by increasing productivity, by making innovations, tracing growth issues, things of that type. Stop this silly trade war. You are shooting yourself in the foot. Kathleen im also wondering about the Financial Services industry. The monetary transition mechanism transmission mechanism. In a world where weve got the trade war, but just move toward negative yields, how does that affect the effectiveness of Monetary Policy . Or go against its effectiveness . It clearly goes against its effectiveness. Operates inicy transmitted impact on the economy through the financial interchange. You need to have a robust financial industry for this transmission to take place. Nobody in his right mind would think low rates or negative rates or zero rates is something that strengthens the financial industry. Weaker. The system much most of the crisis which we have had recently came from the Financial Sector, came from bubbles, from overextending the Financial Investments rather than investing in equipment. By mispricing risk. All those things clearly are not good. When Interest Rates are very low, the most important discipline that drives is done continue toan finance themselves with low rates. This is not good with the economy. Is not good. Rate on top of it, people say the envy the inverted yield curve is a signal for a sure recession. I am worried when i see that in field inverted yield curve, but by the same token, i argue when the yield curve is inverted as a result of arising shortterm rate, it is a very different story than what it is when it is inverted in the context of a normal shortterm rate and not jumping to the conclusion of this indicating a recession because one of the reasons why longterm rates are so low is that people are shifting their investments towards that end because they cannot do anything in the shortterm and also that the Balance Sheet of the central bank is loaded with longterm assets they purchased earlier. This also contributes to a lower longterm rate. Kathleen jacob frenkel, theres a lot to talk about the next couple days. Jacob thank you. Kathleen thank you for joining us. Chairman of j. P. Morgan chase international. Probably the recordholder of attending Kansas City Feds symposium. A lot more coming up. Keep it right here for now, im sending it back to you. Paul thanks, kathleen. There are plenty more big guests coming up on jackson hole, including an exclusive interview with adrian all in a few minutes time and a string of top fed officials. James bullard, robert kaplan, still to come though, former boj webers joined the show as await key inflation data from japan and ask what the latest reading might mean for Monetary Policy. Chinaortant earnings from after results in telecom and energy. This is bloomberg. Paul this is daybreak asia. A bumpy day on wall street for stocks and bonds in the regular session. We are seeing more volatility in after hours trading. Su keenan has more on this. Quite a busy day trying to keep up with fed speak and also a different series of data. Su very whipsawed. If we look at the snapshot, you did notice what things emerge, we are waiting to hear from jay powell. S p 500 financials were among the big gainers. The cac, the losers. Lets go to the big movers. Boeing getting a big jump from an analyst, they may put the max jet back into service. A lot of investors pleased. Two analysts coming out with positive comments on a possible buyout of alexion pharmaceuticals. Earnings. It seems to be bucking the tide of this Department Store of Department Store woes. Going into the bloomberg real quick, gtv is where you can find our library. We talk about rising yields. The s p 500 dividend yield still outweighs or has recently outweighed the 10 year treasury at this point. Hours, different directions. Whats the story . Both reporting. Gap disappointing if we look at how the stocks have traded this far. Which may translate into the friday session. It has reduced its losses. , sales expectations continuing to decline down 4 yearoveryear, or i should say, store sales. Salesforce. Com, meanwhile, exceeding all expectations. Gap have been a big challenge. The ceo saying the challenging traffic trends continue to be an issue. Look at salesforce. Com. They came in with a projection of profit Going Forward that was much higher than most analysts thought. Applications are continuing to see rapid growth. Paul we saw volatility in commodities as well. Whats going on . Charts, oil,day the story is very much some different views on traders shifting from what happened to the demandsupply equation to really focus on the economics of the trade situation. Oil was lower in the inflated session. Gold was as well. Economic data, we did see a decline in claims, but weaker than expected factory data. Thanks very much for that. Has stalledaign according to private surveys and reports. This is adding to concerns of slowing growth. Selina wang has the story. borrowing costs have remained stubbornly high despite this Government Campaign to get more funding to these private companies. It is reflecting a continued reluctance on behalf of banks to toest in invest and lend private companies. We are seeing that reflect it in surveys as well. The challenges grappling with tos where they are trying find private companies as well as go on this deleveraging campaign. Economists say it is impossible to do all at the same time and that they likely could if one of these areas does not let up, the liquidity crisis is on the rise if they dont incentivize these things. To theseeing adjustments Interest Rate regime, this longawaited reform and the change to the new low and prime rates, but analysts are saying that is not enough to get liquidity to the real economy and that more easing is necessary, including a cut to the reserve ratio. We got earnings reports out of china. What did we see . Selina all the companies we all reports from are from very different sectors. Also surprising growth. China telecom showed a big jump in that income. 5gts on the backs of growth. Thank you so much. Lets get back to Kathleen Hays in jackson hole. We are standing by with a special guest. Kathleen a very special guest indeed. , the kansasson hole city fed symposium Getting Started tomorrow. Officials, central bankers from around the world. This one is one of the farthest to arrive here. Adrian orrs head of the reserve bank of new england of new zealand. I also want to welcome our Radio Audience to this broadcast. Fresh from a Whitewater Rafting trip. It was pretty still. Kathleen then you had a lucky one. Big challenges. The feds challenges whether to cut again. Global trade the war, uncertainty hitting businesses. What about new zealand . You just did that 50 basis point rate cut. Where are you now . Early to tell, of course. The idea is to get people out there investing, spending, feeling confident about the economy. We have maximum sustainable employment. Very low unemployment. Inflation is near the midpoint of our band. Looking forward, everyone is telling us we need to be lower. Everyone is telling us the Global Growth is slowing. Lets get ahead of this. Lets move now. Reduce the probability of having to do more later. Kathleen are the Downside Risks materializing . You just have the bank of new zealand manufacturing index, posted the first drop below 50. It is signaling contraction. Been a lot around the uncertainty. Been good. As our government fiscal position is very good. The government is outstanding. Global trade uncertainty has held everyone back from investing. It is the Business Confidence in here. Vestment that is kathleen people are already talking about the next cut. Some thing like 25 basis points. Are they on the right track . Is that the decision you have to make . Went to cut rather than if . Dont no, we certainly to quote ever it takes. A positive are in position. Exchange rate has come up with ,elatively competitive particularly against the u. S. Likewise, we have government fiscal policy spending government debt. It is a good position. We can afford to watch, wait, and observe what is happening. We have already taken a preemptive double. Cut, 50 basisuble points. That same time. Every economic commentator was near 50 or 75 points. They were all surprised when we went there. Kathleen what are you watching now . What is going to be the trigger you say, ok, we have to go. We have to do another 25. Adrian Inflation Expectations are important. I would far prefer to keep them anchored where they are, around the 2 mark. As long as we can keep people concerned, expecting inflation, seeing that passthrough into wage costs, a good thing for the central bank. Government not being able to spend as quickly as what they are predicted to be able to do. The impulse being slower or later. People talk about november for the next rate cut. Is going to make that much difference between late august and november . Adrian no, which is why we there is government consumption, which they call paying people. There is government investment, of which there is an enormous amount. Very difficult to get in place. Then there is transfer. Theres a lot of moving parts. Its really around the ongoing commitment. Likewise, we dont expect rates to be magically turning spending around. We know things will be uncertain. One fear we had of doing a double cut was that people would think we could see something they havent seen. The answer is no. Saying we agree, lets get them. Kathleen your written hypothesis is the 50 basis point cut was enough. Is that what you are saying . We willorking basis is have to see what the situation is in november and be willing to continue to cut if necessary. We used risk analysis. In a years time, looking back, what we most wish we had done or most regretted . That would really drive us to a bigger cut. We have to were think about raising Interest Rates. The quality problem that would be. Theation picking up, versus opposite. Hawk inflationo expectations back up. We know how hard that is globally. Kathleen how much does it factor into your decisionmaking process at the reserve bank of new zealand trying to keep ahead of other Central Banks . A lot of people are looking to see forces and having to move. Is it important to stay ahead of them . Adrian it is important to have all channels of Monetary Policy operating to relative price signals. I say carefully because one is the Interest Rate channel. For a small open economy like us , the Exchange Rate channel. If countries are cutting more isidly and our Exchange Rate being forced up, that becomes an issue. Go one goodng channel of economic activity. At least keeping a proper i on the Global Forces adding onto the local economic issues, getting the balance right. We have been talking very openly about zero bounce. Now was a good time to talk about it. Kathleen what is it youre are worried about getting you there . Is going to be the global trade war getting worse and worse . ,hat is it youre going to say pull out that unconventional toolkit . Adrian the big risk is people talk them selves into situations that are not necessary. Hownnot overemphasize supply constrained the new zealand economy is. Constraints, the infrastructure deficit is very large. We need to invest. Investors are sitting here saying, we hear these stories globally, we are not sure. This is a neighbor government and we like the other ones. Labor government and w like the other ones give the government time to invest, time to transition into more productivity. With Interest Rates as low as they are, investment is very small. Kathleen everyone is waiting to hear jay powell speak. We have had the Kansas City Fed not ready. What i want to ask you is what would or will a fed rate cut or cuts mean to your policy . It would be Interest Rate differential would lead to exchangerate behavior. The path is very shortlived. What would that additional stimulus due to the economic engine . For the demands of goods and services we produce . That is the main part for us. Globally, the path remains positive for us even with talk of uncertainty. Financial markets have been well behaved. It is the confidence part that has been the big bugbear, something we know least about. Kathleen there were a couple weeks when so many asian Central Banks cut their rates. The kneejerk responses, look, currency war. Asian central bank are doing a lot of things you are. There is a trade war. It is getting worse. Respond . U what is the difference between cutting rates because you think you need to or currency war . Vastly different. I would not even consider a currency war because that is a race to the bottom in a negative sum game. Exchange rate is simply a relative price. I want people to think hard about why would they be holding a new zealand dollardenominated asset for the longterm economic reasons . Worrying about shortterm volatility is interesting, but its not going to inform you. In terms of the told of a currency war, im not sure what they would be. Intervention can work. Temporarily in some situations. Not a longterm path. A longterm path is low inflation, maximum sustainable employment. Are aen apparently you fan of negative rates. Would negative rates boost inflation . Would negative rates encourage people to spend . When japan made its small move a got savedback, people to put their yen in. Why would that be a good move . I did talk about negative Interest Rates versus other tools. The reason i think about negative Interest Rates is because they are very impactful tool across a very broad sector of the economy. Rather than having to narrowly target the winners are the all tools are useful. Some could be more effective at times. I like the Interest Rate one as well because in a sense, you can negative Interest Rate. It is economically efficient. Having said that, i would want to be able to have the Interest Rate one also brings less concern about political interference. You are not asking to use a different way. When would you say now is the time to start using unconventional tools the . Do you have to see a recession . Do you have to see 25 basis points above the zero lower bound . What should we be expecting . Adrian for us, it is easy to talk about. Without a forwardlooking path for Interest Rates, which we produce and provide to the market, when things are negative, we will be thinking inflation picking up because of monetary fiscal stimulus. Nearterm, declining, if not negative Interest Rates. Kathleen thank you so much for joining us, your Whitewater Rafting trip to the reception. Adrian i am the luckiest person here. Kathleen we are lucky you joined us. Adrian orr joining us for a very special interview. We are going to send it back to you. Paul thanks very much, kathleen. Kathleen hays at jackson hole. Lets get a check on what is happening with the markets now with sophie. Sophie the kiwi dollar rising 0. 3 on the back of adrian orrs comments on a longterm path for the economy. The toolkit at his disposal, including negative rates. Taking a Bigger Picture view on the kiwi dollar, this has given support, little nearing the lowest level since 2016. Coming through as we are waiting readingow traders are are reacting to what governor orr had to say. Japanese assets, we did get cpi data earlier. The yen not doing much, trading in a tight range with inflation coming in line with estimates of about 0. 6 on a year on year basis. Powell very much and focus. It may rise to 107 for the japanese currency. Jgbs, we will be keeping an eye on that ahead of Fund Operations in the one to 10 year zone. Jgb likely to keep falling today. As sophie mentioned, we have seen core prices for japan coming in line with estimates. We have seen a little bit of pressure when it came to the National Number because we have seen easing of prices on fresh food. We have numbers decelerating, coming in at 0. 5 percent growth year on year, which is down from the month of june. Now, excluding fresh food, also excluding energy, 0. 6 year on year is accelerating for the month of june. Of course, core cpi is that we care about, which is what the boj tracks, far below their target of 2 . Joining us now from tokyo is the former boj board member and professor of economics. Great having you with us. Give us your initial reaction to the numbers. Is this as you expected . Yes. Inflation is quite muted. If we look at the producer pricing, consumer good pricing still declining. The boj is able to increase inflation. Do we see in terms of the economy . We seem demand being increased. Thate same time, it seems there are challenges for the japanese economy. Yes, especially export and import. Those are dropping on a year on year basis. Export declines much bigger than import clients. That conservation of trade to the Economic Growth is muted. The situation continuing, exposed to china and others, dropping. Sentiment. Pping consumption is stronger partly ofause of the increase ahead the consumption tax hike. It is may be temporary. I do not think all japanese economies are in very good shape. If we look way back over the past 30 years, inflation has averaged 0. 5 of a percent. I what point does the boj have to walk away from this almost hilariously optimistic 2 target or try something radically new . Sayuri it is very difficult to get rid of the 2 target. At this moment, Major Concerns for the central bank in japan is the Exchange Rate. Tothe boj is no longer able achieve 2 , it is very difficult to affect. Some people mention about money for the case of japan, but the Monetary Policy and fiscal policy, they are doing it collaboratively. I do not think there will be major changes from the current framework. Paul lets talk about fiscal policies. Getting ready for this conversation, i read a couple of articles. They called for deep, structural reforms. One of those articles was dated 2019. The other was dated 2014. We have been waiting a very long time for these structural reforms. Do you see them ever coming . Yes. Sayuri reform, but people are not consuming much. People worry about life after retirement. Wages are very low and sluggish. They like to say rather than consuming. About reform,y Social Security reform. Ple have some vision about optimism about sustainability, about health insurance. This pressure on jgb yields, we have heard recently from larry summers, tweeting about this black hole of monetary economics. Let me redo this tweet. Interest rates stuck at zero with no real prospect of escape is now the confident market expectation in europe and japan, essentially zero or negative yield over a generation. The United States is only one recession away from joining them. Japaneseee the treasury market . Is the u. S. Headed there . It is possible. This downward pressure on the 10 year yield globally, including all come from this massive easing conducted by japan, europe, and the u. S. They all added to this downward pressure. In addition to that, the ecb and the fed are going to do additional monetary easing. That would create the possibility that even the u. S. Might turn into the negative territory. That creates a lot of distortion in asset prices. Please stay with us. We will come back to you for more conversation in a moment. For now, lets get the first word news. French president Emmanuel Macron has poured cold water on any hope of a new brexit deal after talks with u. K. Prime minister boris johnson, he tempered any optimism by saying changes to the current deal will not be significant. Johnson is demanding the eu scrapped the socalled backstop, the mechanism designed to keep the irish border free of checks after brexit. He still thinks he can negotiate a new deal. I want to be clear to you, to the french people, i want a deal. I think we can get a deal. South korea is withdrawing from an intelligence pact with japan as the feud widens. Itsl has notified tokyo of decision to abandon the arrangement for exchanging military information despite appeals from u. S. Officials, including President Trump. Seoul says the move is due to japans decision to remove korea from its list of trusted export definitions and google has disabled more than 200 Youtube Channels involved in what it calls attempt to coordinate and influence operations by the protests in hong kong. Youtube does not say which channels have been shut, but says they are consistent with recent action related to china by facebook and twitter. The company say a counseling to the Chinese Government have been trying to undermine the say accounts linked to the Chinese Government have been trying to undermine the demonstrations. A new effort to spread the benefits of Global Growth. Economic inequality is a defining challenge of our time. The oecd initiative will be launched by president macron at the g7 this weekend. Participants include jp morgan, andal, virgin, unilever goldman sachs, among others expected to join. Global news, 24 hours a day on air and tictoc on twitter powered by more than 2700 journalists and analysts in more than 120 countries. This is bloomberg. Paul thanks, jessica. Still to come, back to jackson where global on Monetary Policy is headed. Paul this is daybreak asia. To jackson hole with Kathleen Hays. You just spoke to adrian orr a few moments ago and you spoke spike, thewi dollar rbnz being able to afford to wait. To wait. Are we getting a picture of a more patient jackson hole this time around . Kathleen that is what we are waiting to hear from jay powell. Adrian orr said he wants to wait. He wants to see what the data do. I guess it is the central bank theme around the world. The fed they got out in front with a 50 basis point cut. He said all the expectations were there, thats why they moved. When i asked him, you know, are you assuming you dont have to move . He said, we are watching. But you are right. The message that seems to come through is that he is not just going to pull the rate cut trigger just like that. Lets listen. We were saying everyone was telling us we need to be low, everyone is telling us Global Growth is slowing. Lets get ahead. Lets move now and reduce the probability of having to do more later. I think everybody should realize that does not mean adrian orr does not think they are going to be cutting rates. He is watching u. S. China trade war. When i asked him, what do you think rate cuts would mean . We might have to do something. There isyou know, if more stimulus and there is more growth in the u. S. , there could be demand for the things new zealand makes. Now getting onto the Federal Reserve, we have heard from three fed Bank President s today, and one of them was the fed reserve Kansas City Fed chief. She is the host, also one of the president s who dissented at the last meeting. She does not see the need for accommodation now. She is not going to move because of signals of distress from the market. Lets listen. As i look at where the economy is, it is not yet time. Im not ready to begin to provide more accommodation to the economy without seeing an outlook that suggests the economy is getting weaker. Of course, Patrick Harker thinks it is time to hold , all the more reason for people listening very carefully to jay powell has to say. We also spoke earlier with the former head of the central bank of israel. Thes someone who watches fed and Central Banks very closely. He said, great, its not until the middle of september. There is a lot of time for the fed to wait and watch. He figures there are enough voices leading toward that lower rate, there is no need for the fed to move quickly now. Even so, this is traditionally a fed chairs opportunity to send some kind of message on policy about what might be happening. Janet yellen has done it. Ben bernanke did it. As jay powell wants to send a signal, maybe he will tell us yes, i am cautious, but i am ready to wait or maybe he will use that signal once again. The global uncertainty. Being ready, at least ready to move. We wont know until a few hours from now. Paul thanks very much for that. We will have plenty more indepth coverage, including interviews with a string of top fed officials. This is bloomberg. Paul this is daybreak asia. Quick check ofur the business flash headlines. Lamborghinis decision to add an suv to its traditional lineup of supercars is paying off. The push into wider luxury market has helped boost evaluation to 11 billion. Bloomberg intelligence says that makes it a viable potential spinoff. Year,as launched last pulling lamborghini level with for ari level with ferari. Paul chinas biggest Insurance Company may not need insurance against the trade war. 129 as newed Business Value expanded. The company was also significantly helped by tax relief that helps cut income tax by a first 80 and half rally in chinese stocks. Shery socgen has hired bain to help at its paris headquarters. The firm will help the bank find expenses on i. T. , hr, and the finance department. A fresh round of cuts would add socgens ongoing reorganization involving more than 550 billion of savings and 1600 jobs. Markets open in tokyo city and soul at the top of the hour. Are pointing to losses with Central Banks in the drivers seat. There could be boj easing given the number we got this morning hovering near a twoyear low in japan. New zealand, we are seeing losses. The kiwi dollar is jumping as much as 0. 4 on the back of governor orrs comments saying he could wait and watch at the situation unfolds. Kiwiussie against the could be hitting a ceiling as new zealand derivatives, that curve is pricing in no change in september. Saying he will do whatever it takes to support the economy. Checking on bonds, yields climbing in sydney as well as wellington. The aussie 10 year yield eyeing that 1 . Bond traders on high alert. We are seeing traders protect against rising yields with a surge on treasury futures. The start of cash trade in tokyo city and seal seoul. Paul im paul allen in sydney. Asias major markets are about to open for trade. Shery good from bloombergs Global Headquarters in new york, im shery ahn. Sophie im Sophie Kamaruddin in hong kong. Kathleen im Kathleen Hays in jackson hole. Here are the stories we are covering this hour. Pressures on jay powell. The fed chair kicks off a fed symposium with three regional fed Bank President s saying now is not the time to cut. Paul more top stories this friday. The Central Banks are making headlines. Boj facing difficult policy questions as inflation remains stubbornly weak. Shery easing later this year. The kiwi jumped as the governor tells bloomberg that they can afford to wait. Shery Market Action with sophie as we had to the open of japan, south korea, and australia. Sophie we see some generations at the start of cash trade in tokyo. Nikkei 225 opening with little change. The topics up. 10 . The yen is Holding Steady. There is a lot of folks on the sidelines as we wait for the jackson hole and g7 meetings to unfold. Japan. On coming in in into the autumn, were set to have lower price gates when it comes to inflation for japan. Lets check in on the cospi. Index lower by. 5 . The korean won is on the retreat, heading back to 12 against the dollar. I want to highlight an early stock movers in seoul. It is a dissent related stock in south korea. Concerns at play, along with deterioration ties between japan and south korea. Checking in on the activities, the asx 200 this morning opening to the downside. The aussie dollar is just trading flat. We see the kiwi space under pressure when it comes to stocks. Reversing earlier gains as we heard from the fed governor that he would do what it takes to support the economy. He doubled rate cuts at 50 basis points. It will allow space to wait, watch, and observe to see how the situation unfolds. The kiwi dollar popping as much as. 4 . Lets check in on bonds. Ground in new zealand and australia. A 10 year treasury yield Holding Steady after the rise we saw overnight. Traders are assessing whether or not the rally in bonds could be seen as a turning point. We do have traders protecting against that potential shift wit h puts on treasury futures surging. Thanks for a much. Lets check in on the first word news with jessica summers. U. S. Aviation regulators are said to be using relatively inexperienced pilots Flight Control Software Designed to help boeing 737 max returned to service. The faa wants to find out how to give pilots the experience, but at least one flight reacts to the update. Similar training was set for the start of next month, but sources say its been pushed back a week. French president Emmanuel Macron has poured cold water on any hope of a new brexit deal after johnson. O boris he tempered any optimism by saying changes to the current deal wont be significant. Johnson is demanding the eu scrap the socalled backstop, the mechanism designed to keep the irish border free of checks after brexit. He still thinks he can negotiate a new deal. I want to be clear to you that i want a deal. I think we can get a deal. Jessica Hong Kong Retail sales have plummeted this month as the street protests inflict grown damage on the Global Economy. The retail Management Association is calling on landlords to cut shop around in half for the next six months. They want the government to measures. Her relief the value of retail sales dropped 6. 7 in june from a year earlier. The fifth straight month of declines. Cathay pacific is cautioning staff that misuse of social media can be a breach of rules laid down by china. Thats after some staff were found to have taken part in hong protest. It told employees posting, sharing, or responding to content can violate the demand of chinas aviation regulator. They said any employee that participates in illegal activity may end up being fired. Say thefrom china reason a worker at a hong kong u. K. Consulate was detained on the mainland was because he visited a prostitute. Police were involved because he broke the law in public security. The charge carries a sentence of 10 to 15 days and a potential 700 fine. The paper offered no evidence against him, but says he asked police not to tell his family about his intention. Global news, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 120 countries. Im jessica summers, this is bloomberg. Head back to jackson hole. Our Global Economics and policy editor, Kathleen Hays, is there for us. Kathleen joining me is carmen reinhart, someone who has also been to this symposium many times before. She is a professor of International Finance at the Kennedy School at harvard university, coauthor of this time is different. Maybe i would like to start there. This time is different is about how it really wasnt. The long recovery from the crisis, you predicted it and it came through. Recession. 10 year expansion. Something has to push you into recession. Said hiking too much, but a shock. Are you worried about shocks in the system right now . Carmen of course. One of the things setting this period apart is the incidents of shock. We have had the trade tensions. One that is concerning the great deal at the moment is the turmoil in hong kong. Had turmoil in hong kong quite possible consequences for growth in asia, china, these are not segmented regional effects. These have global consequences. What could be a Tipping Point verycould trigger a significant global slowdown, even a recession . That would be a candidate. Kathleen how would you see that playing out . What did you see that hong kong is unseeded or unsettled in the Financial Sector . Would it have something to do with the Chinese Government taking aggressive action against the citizens of hong kong . What would cause the shock from hong kong to be so severe . Carmen i think you could have shocks with a bang or with a whisper. The bang part is there is an event with china that is dramatic, the impact on the region, their capital flight renminbi, thats the drama part. The less dramatic part, but nonetheless very real, is already taking a situation that was weaker where we had seen a slowdown of significant proportions, and making it worse. Needng points dont always big drama. Kathleen slowdown, china, how do you gauge the extent of their slow down right now and the effect of the stimulus they have done so far . How much more will they do, particularly if there is this next wave of tariffs on september 1 . Carmen the slowdown has already had major ripple effects on the world economy. We have seen it in commodity markets, very significant , indown in asian economies latin american economies that are commodity exporters. The global repercussions of the china slowdown we have already felt. Fomc minutes, the you see concerns among some of the members saying the global is theon part of that u. S. Tradechina war. No more recently, the currency war. Concerns theis Global Economy had been slowing pretty much across the board. Europe, china, ems, so on. Kathleen i asked adrian or governor of the reserve bank, with people cutting rates to stimulate the economy, then people immediately say it is a currency war. Do we have the early days of something that will become that . Last month, i was at the bank of france conference celebrating 75 years of bretton woods, chairman powell was there. Many of the attendees here were there. Exchange rate of stability, bretton woods, so on. In those days, it was done explicitly. Now, Central Banks do Interest Rates. Effortstill seeing big that are geared towards avoiding appreciations. Lends the big concerns credence to the potential of a currency war, who wants to appreciate . Nobody wants our currency to appreciate. What is the result . You lower the Interest Rates. Central banks has been moving in packs, so to speak. Because standing out, allowing your rates to be significant , immediately has implications for an appreciated currency. Nobody wants and appreciated currency, nobody wants a current account deficit. It is somewhat ironic at this moment, were seeing the more vivid accusations of chinas currency being manipulated. China has been coping with capital outflows for some time now, which tend to depreciate the currencies. When you can really have made the case for more manipulation was years back, the doubledigit growth, capital inflows, in big tendency to appreciate, and they were fighting that. It is ironic it is surfacing now. Kathleen they open up the credi currency and let it from really. Roam freely. Carmen the big difference from any country pause currency weakening, chinas currency, and this goes back to the hong kong big repercussions for emerging markets. Emerging markets are competing with china, and they do not want their currency to appreciate versus the renminbi. It is somewhat ironic that we are seeing this accusation. Kathleen jackson hole, this conference, jay powells speech, is the fed on the sideline . If it cuts rates or does not cut rates, does the fed have a key role in all of this . Ismen what the fed does always a really critical point in the Global Economy. If you go back through history, even right through the present, Federal Reserve Interest Rate cycles have outsized the facts globally. Were not lowering Interest Rates right now, i dont think we would have seen this state of other Central Banks lowering rates. It really sets global Interest Rates. The big question that everyone is waiting for is to sort out the question of if this is a beginning of a rate cycle, long or doing arates, little bit here and waiting to see how things pan out, which is my interpretation. Kathleen what will they do . Will they cut in september . Will they be doing more . What should they do, in your view . Carmen what they will do and should do may not be the same thing. Let me start with what i think they will do. I think its what markets expect. I think that is another cut. Is certainly no unanimity of views within the fomc. If you look at the minutes, it was agreed to cut, but for different reasons. Its not like you had this homogenous view. We are at a point where theres a lot of uncertainty. To finish the point, i think a september cut is the most likely outcome. Then a wait and see, lets look if manufacturing picks up, how global events shape up, the trade issue, and all of the other concerns about european slowdown and so on. Kathleen carmen reinhart, thank you so much. In hongmy colleagues kong will particularly appreciate your points about the importance of protests, what difference they can make. I want to thank you for joining us on your way to the big reception this evening. Following what she said, shocks dont always happen with a bang, they can gradually happen over time with a whimper. Interesting for bankers to think about as we start of symposium tomorrow morning. Back to you. Paul bloomberg Global Economics and policy editor Kathleen Hays. We will see you again from jackson hole later in this hour. Still to come, we will preview jay powells speech at jackson hole. The former bank of england is asked about the feds next move. Shery the feud between south korea and japan continues on his downward spiral. Detail just ahead. This is bloomberg. Paul this is daybreak asia. Im paul allen in sydney. Shery im shery on a new york. South korea is withdrawing from an intelligence pact with japan. Lets cross to seoul. Our reporter has this. I covered the 2012 protest against the path and it was scrapped and implemented in 2016. What will be the Practical Implications of this . The Practical Implications, we dont know yet, because it was quite a hastily made pact. If you look at how many times south korea and japan had shared information through this pack over a. Over a period of three years, its been 28 instances. South korea will tell japan out of certain information of north korea, their whereabouts and the missile launches. Emphasized minister it is rather more of a diplomatic effect, in terms of this pact. U. S. Hasan the expressed explain disappointment after the administration decided to end this deal, perhaps bringing a dent to south koreas role in the u. S. Of lines of defense. Paul what happens now, in terms of process in south korea getting out of this deal . Iswhat happens next tomorrow, august 24, they will be notifying japan that they want out of this deal. The deal is technically effective until november 22 this year. It will be nullified as of november 23 if it is not automatically extended. It has been automatically renewed every year for 365 days every november 23. Japanth korea is decides to withdraw its recently implemented export curve decision to remove south korea from its list of trusted export countries, south korea is willing to reconsider its decision to opt out of its military pact. Lee, thank you so much. Lets check the stock movers with sophie. Sophie costar group shares falling as much as 70 . Trading outlook remaining. We do have bravura on the other head, rising as much as 11. 5 . 2019. Ofits rose 21 in the stock is swinging to losses. Is set to acquire midwinter Financial Services, which comes after his bid for the holdings. In sydneyock movers is goodman group, rising to an early july high after posting stronger profits and guidance due to a logistics boom. On the other hand, we have linus sliding after plans were scrapped to take over the rare earths miner. It did markets interest in april. Over to japan. Another takeover bid has soured. Withdrawing from the opposition of a stake in a hotel operator. After a rival offer was announced with a higher price. Shares jumping on the withdrawal. Aia group says the value of its new business surged for the first time past 15 . That was in line with the median forecast. Its china unit led the way with a 26 jump. Lets get more on those numbers with our insurance analyst stephen lamb. Where will iai be seeking growth in the second half . Are the protests in hong kong going to affect the plan . I think the second half momentum definitely will have a little bit of an impact from the hong kong side. We can argue it can be a timing issue. Strong. Mand remains theres a lot of fundamental drivers backing the strong growth in the first half for the hong kong that can continue in the second half. Things like the demand in health insurance, annuity products, the likes of that. The other thing to consider, the renminbi remains strong against the dollar. Demand from chinas side is going to be very robust. The challenge is whether they can come to hong kong. We should all consider there are other places they can go. Shery china life also reporting strong net profit growth. Can it be extended into the second half . That can still remain strong. The good thing in the first half is they have increased quite a number of agents, which is not expected widely in the market. The activity were also very fairly well he done. They come from a low base, in terms of the margins. We still expect there will be a pickup, in terms of the margin for a second of of the year, mainly because it focuses in longterm protection products. Shery thank you much for that. Plenty more to come on daybreak asia. This is bloomberg. Paul lets get a quick check of the latest business flash headlines. The worlds biggest stock exchanges are stepping up their courting of saudi aramco in a battle to host the largest ever ipo. Senior officials from london, new york, and hong kong have been ditching aramco in recent weeks. The company will initially list, but will make a decision on a secondary exchange. Saudi arabia hopes to raise as much as 100 billion in the ipo. Shery dropping a sock and shifting focus to tokyo and youll potential locations to build a new casino resort. Allowpassed last year to up to three locations in japan to be developed into casinos. Yokohama is inviting proposals for an integrated proposal. Japan has gaming revenues that can reach 20 billion a year. We will have plenty more to come on daybreak asia. This is bloomberg. Jessica this is daybreak asia. Im jessica summers with the first word headlines. The feds jackson hole symposium threatens to reveal opposition between policymakers. Jerome powell is under increasing pressure from the president to cut rates. At least three regional fed bosses told bloomberg they oppose the idea. Eric rosengren, pasha parker, and the jackson hole host all say this is not the moment to cut. As i look at where the economy is, it is not yet time. Begin toeady to provide more accommodation to the economy without seeing an outlook that suggests the economy is getting weaker. Jessica south korea is withdrawing from an intelligence pact with japan as the feud between the neighbors widens. Seoul notified tokyo of its decision to abandon the threeyearold arrangement for exchanging military information, despite appeals from u. S. Officials, including President Trump. The move is due to japan decisions to remove korea from its list of trusted exports nations. Google has disabled more than 200 Youtube Channels involved in what it calls attempts to coordinate and influence operations tied to the protests in hong kong. They have not said what channels have been shut, but it is consistent with recent action committed by chestnut by facebook and twitter. The accounts linked to the Chinese Government have been trying to undermine the legitimacy of the protests. Some of the worlds most High Profile Companies have signed on to a new effort to spread the benefits of Global Growth, saying economic and equality is the defining challenge of our time. The initiative will be launched g7president macron in the this weekend. Participants included jpmorgan, loreal, and danone, version, unilever, and goldman sachs. News, 24 hours a day, on air and at tictoc on twitter, powered by more than 2700 journalists and analysts in more than 100 countries. Im jessica summers, this is bloomberg. Lets get a check on whats happening in the markets with sophie. Sophie asian stocks are trading mixed. We have australias performer with what is a modest session. Asx 200 up. 02 . The kospi is lower. We see bright spots for the benchmark. Defense shares are on the move. Ending its military intel pact with japan. In the currencies base come of the kiwi dollar is the clear out performer. Jumping as much as. 0 . The majority of kiwi buying coming from the aussie rather than the greenback. The korean won is under pressure this morning. Back where we were at the start. The boardchecking and on bonds. We see yields climbing just a tad this morning. The aussie 10 year yield at 1 . Pressure in the front. Ois rates higher on the fed governor. Treasuries are just steady at 1. 6 . The focus in markets has been on the commentary from the fed governor. Paul lets stay with the kiwi. Bulls were bullied by the comments by the governor. Hes going to have a more patient stance on future rate cuts. Forward when everyone was telling us to be lower. Global growth is slowing. Move get ahead of this and now to reduce the probability of having to do a lot more later. We are safe where we are. Paul this should boost the near term ceiling. The longterm outlook is up in the air. Where does this leave the kiwi . We are talking about kiwi bulls getting some relief. They were desperate for relief. Were looking at the way currencies have gone. Hit lows since 2015. A bit of a pullback from the governor, who has been willing to push the dovish envelope. Gives them time to take a breath. Rba has been more willing to go before them. Decent chance they will go in october rather than november. That gives some relief for the government. Very low. They are not talking about even staying neutral. If they are going to move, the bias is to cut, which it has to be. Everyone else is looking to cut. Shery we are seeing yields at the moment on treasuries gaining ground. We saw it in the regular session in the u. S. We continue seeing more caution on future fed rate cuts. It seems there is a broader theme going on i jackson hole, at least early in the session. Is a bond rally in the moment at risk . For now, it looks like potential pause, or there could be a correction. Bonds have become very aggressive about what they are pricing, as far as paying for the Global Economy goes. Overnight, we got the first contraction in the u. S. Market measure for the pmi. We also had more concerning, the Services Flash pmi for the u. S. It was still in expansion territory. It dropped by a lot. Those are concerning signs about the momentum of the u. S. Economy. Even as european measures picked up a little bit, most of them are still in contraction. It is a rough outlook globally. I think the bias from a lot of central bank governors, not just the Federal Reserve, is they want to wait and see. How much help there will be that feeds through their economies from what they have done on rates. Policy seems to act with a 12 month leg. They are going to cut, then the pmi comes up and they cut again, they will wait and see how it goes. They did just address the weakness. The bond market has piled into the idea that they will have to do a lot more. If this pushback from the Federal Reserve lasts, and previous episodes have not shown a lot of spine when it comes to the bond market, but if it lasts, bonds are seeing as being extremely expensive. They could be in for a very rough time. Shery thank you so much. Bloombergs mliv editor. Lets head straight back to jackson hole. We have Kathleen Hays with the feds annual meet and greet. Kathleen thank you so much. Kristin forbes joins me now. She is the professor of m. I. T. S at she is a former member of the Monetary Policy committee at the bank of england. Great to see you. Year number two for us. Kristin a pleasure to talk to you. Kathleen makes us all look good. The agenda, which is under embargo, has just been released. Prescient ofel, so the Kansas City Fed Monetary Policy divergence. What do you think that is about . Why is it so important . Kristin Kansas City Fed did a great job. This is very timely. Temperature likely discover topics such as one interest country whos economy may recover at a different rate than other countries, can it adjust Monetary Policy to meet its own domestic needs, even if other countries are Monetary Policy in a different way . Monetaryountrys policy be out of sync with other countries . The ecb has signaled they will ease Monetary Policy in september. Does it mean the rest of the world . Suggested that in july, the u. S. Fed lowered rates partly because the ecb signaled it would be lowering. That made it harder for rates to stay at a higher level. Very important questions this first panel. Kathleen this is the kind of thing it is always conjectured. The first market people conjectured were taking this seriously when this is their work, their research. Central bank officials, the fed, does not like to discuss the idea that it is influenced that way. Our focus is the domestic economy. Kristin what happens in the rest of the world is also true. It is very important the fed sets Interest Rates as any central bank does, based on what makes sense for its own economy. Its on inflation rate, growth rate, whatever that mandate is. At the same time, what happens in the rest of the world matters, because that affects inflation rate, growth rate, unemployment rate. They are still consistent. What matters and the rest of the world matters for the fed, even though they focus on the domestic mandate. Kathleen how about the bank of england . Do you struggle with these issues . The u. K. Is the textbook example of a country that found it very hard to run a divergent Monetary Policy. Joined, right before i the bank of england, there was an expectation the u. K. Would be raising Interest Rates. Expectations were they would go up before the end of 2014, the first lift off of any major economy, even the u. S. The u. K. Never got rates up. Not in 2014 or 2015. In 2016, it lowered rates in response to the brexit vote. It was an example of how the country cant run a divergent policy. What i learned from that experience is it is hard to run a Monetary Policy out of sync with the rest of the world. If we in the u. K. Discuss raising rates before other major economies, sterling appreciated quite a bit. If the pound got stronger, that meant import prices fell, and dragged down inflation. Inflation fell by so much, it made it hard to adjust Interest Rates. Its a clear example of how running a divergent Monetary Policy gives you feedback effects that can make it harder to do your job. Kathleen how is the debate on divergence related to the debate on currency wars . Kristin directly relevant. If now, just talking about running a divergent Monetary Policy, raising rates out of sync with the rest of the world, it means the currency adjusts. As happened in the u. K. In 2014. You can see more effective Monetary Policy on the Exchange Rate. If we get more volatility in Exchange Rate, more adjustments in the Movement Without having to even move the Interest Rates very much. For the people who worried about Exchange Rate movement and how it affects Different Companies and competitiveness, this attention on currency wars will not go away if it can be continued to see these effects of Monetary Policy divergence. Kathleen another topic is capital flows to emergingmarket. How does this fit into the question of challenges to the Central Banks . Kristin jackson hole has had a number of important papers on markets. There will be another session this year. Session, it is a nice time to take a step back and look at what may have changed. Capital flows have contracted over the world. There are quite a bit less bank flows driving capital flows to emerging markets. That has been one of the more volatile types of flows that cause difficulty in emerging markets. As they decrease, capital flows get more stable. That can be one implication. At the same time, emerging markets need more borrowing from corporate companies, more borrowing in dollars. That means these emerging markets can be more sensitive to currency movement. Back to this issue we were talking about with divergence. You will see more effective Monetary Policy on Exchange Rates. Thats combined with the fact that there has been more borrowing in dollars. Those effects can magnify each other and have amplified risks for emerging markets. Kathleen in the midst of all of this, what is the biggest thing of the global currency Interest Rate move . Kristin the biggest concern is what happened next on trade wars, especially the uncertainty around them. Its not necessarily where the tariffs are, but if Companies Start worrying about their cost in the future, they will probably hold back from investing. They will probably step back from International Expansion and global value chain, which can make them less efficient. That will hurt growth for an extended period, even if the immediate issues will result. Kathleen it is bad enough those centralbank policies may converge on more rates. Kristin forbes, thank you for joining us. Heres the Kansas City Fed symposium just getting down. I will send it back to paul in hong kong. Paul thanks very much for that. Kong. Little way from hong we will be rejoining you in jackson hole later today. Tells us the latest on his profitability and the new Gaming Partnership with tencent. This is bloomberg. Shery gaming device maker razor has posted its latest set of results. Revenue grew over 30 in the first half. Relay loss of 48 million there was a loss of 40 million. They are teaming up with tencent in cloud gaming, which allows users to play online without downloading or installing software via consuls or smartphones. Joining us from singapore is the ceo. Great to have you with us. Lets talk about your numbers. A big loss, but at the same time, it was more narrow than before. When can we see you break even . You can see our numbers for the past couple of earnings, we have been scaling. Our core business has been profitable. Thats been part of our strategy. Our Growth Strategies have been doing well. Cloud gaming, mobile gaming, Services Business did very well in the first half of the year. Shery one of those projects you have going on is with tencent. In your earning statement, you talked about cloud gaming as a potential forward vertical. Explain what that means, and how it will annexed essential growth. It will add existential growth. Cloud gaming is one of the this point in time. Our partnership with tencent is to take cloud gaming to the next level. We are working on the hardware and Software Side of things, and the services. This is going to contribute to extent of our growth. The first half of the year, we have grown 30 year on year. We see this growth continuing with the growth of the entire gaming industry. Paul lets talk about your fintech performance. That is a new area for you. You called the result robust. How important do you see that as being part of your business Going Forward . You are certainly available in malaysia. Are you finding competition tough . Perspective,ngs in if you look at our Services Business, even for an ipo, we spoke about this ecosystem we have built. Hardware and software services. On the Software Side, our numbers have grown to about 70 million users. For our services, 110 growth, in terms of revenue. In 2017, it was 0 . Now its about 36 million, in terms of revenue. Underpinning all of this, we are the largest the Payment Network in the emerging markets of southeast asia, middle east, latin america. We have built that fintech layer on top of that. In terms of the wallets, we are only in malaysia. Were the biggest e in malaysia and scaling to the other markets. Paul are you still looking to apply for a banking license in singapore . We keep our options open. Given that we process billions of dollars of digital payments, we are one of the biggest brands, in terms of the youth and millennial. We want to focus on the youth demographic we work with. From the virtual bank perspective, theres a lot of value we can bring to the youth globally, not just in singapore. Shery what does that mean . We heard you were speaking to a bank. Right now, there are a lot of rumors. Wehave a partnership that have announced with visa, specifically focused on accessing this network we have. A network in the emerging markets of about one million offline points. Us ishat has supported this growth in terms of our Services Business. We have helped Game Companies monetize. Now with the reason, we think we can take it to the next level in terms of creating new solutions for the youth everywhere. Singapore is a great location for us to really focus on what else we can do together with visa for the youth over here. Shery if you work in singapore, you are going to do it through a joint venture . A majority stake . How will it look like . Right now, we are keeping options pretty open. Years,e past couple of we have become one of the biggest fintech players in the region. We want to find complement trade partners. Visa have been one of them. We are working with Tech Companies in the region. Aboutt really speak future developments at this point in time, but what i can say is we are options open and talking to different people. Will, itore will you is friday, are you really going to launch a toaster . Of fansve a whole bunch globally. They will be really happy you mentioned that live on bloomberg. To get had this movement them to talk about toasters and stuff like that, we had fans weh the logo, i have said have over 10 guys with a toaster. Unfortunately, i will have to make one at some point in time. Paul thanks to the razer ceo. Plenty more to come on daybreak asia. This is bloomberg. Shery this is daybreak asia. Im shery on a new york. Paul im paul allen in sydney. Protests in hong kong have been called a leaderless, but it does not mean they have not been highly organized. Shelley vandross has been investigating how technology has been crucial to the cause. Tell us what you have found. Week, how there last the big airport protest happened and how people really swarmed the airport and took it down. This highly coordinated, very interesting network of people are using discussion forums like organize telegram to these protests, run supplies to different areas, create marketing, and promotional material. Quite a big machine that exists, even though there is no one big leader leading the entire protest movement. Paul how is this different to the 2014 occupy protests in hong kong . In the 2014 occupy protests, use of people physically occupy the Central Business district. People had to be there 24 hours losingr risk of momentum. This time, all sorts of different groups organized if in activities every day where people can come and go as they please. It allows the movement to sustain itself. In addition, theres all sorts of different groups and factions. About 100 core Group Leaders organizing different actions. Polices that even if the or the government did want to shut down the movement, there isnt any one group or a handful of groups that they can really go after to target, or even negotiate with if they were looking for an end to the standoff. Shery one of the downsides to a Leaderless Movement . Downside pitfalls are that we dont know where its going to go from here. What will continue sustaining the momentum if you dont have anyone to follow . That can be problematic for the protesters themselves. Lso, use of the downside come up during the airport protest. You saw violence occur, because no one was willing to walk people off of the ledge. A lot of protesters were paranoid there were infiltrators. People were worried about people spying. You really saw the violence come out when people attacked a global times reporter. Those are the things they can be worried about. Shery thank you so much for that with the latest on the hong kong protest movements. Lets get a preview of what to watch in markets later this morning. Sophie we are watching xiaomi after the companys revenue forecasts were cut by cicc through 2020 on 5g uncertainty. We will watch retailers after the association in hong kong noted that sales plunged 50 in august, urging them to have rights for six months. Fellin focus after revenue 8. 4 percent. Another setback after its restructuring shares are down 50 year to date. Chinese stocks are hitting a wall. The composite is hitting its head against a resistance level after over two weeks. 12 off the april high. It may weigh on the economy outlook. Another prices crisis may be brewing. Thats it from daybreak asia. This is bloomberg. Shanghai were, welcome to Bloomberg Markets china open. Im tom mackenzie. Im yvonne man. We are counting down to the open of trade. Im david ingles. Lets get you the top story. Central banks policy dominates headlines. Open jacksonll hole with conflicting advice in future rate moves. Yvonne easing later this year. The key we jumps as governor adrian or tells bloomberg he may cut he made cuts in november. Everyone is telling us we need to be lower. Everyone is telling us Global Growth is slowing. Lets get ahead of this. Jackson hole