Transcripts For BLOOMBERG Bloomberg 20240704

Economists were expecting at least a 4 . Property investment is a sore point, still eight. 5 down. Worse still 8. 5 down. A slight pickup in the jobless rate. I cannot seem to find a be. It seems like a miss across the board on activity numbers coming through. We are still waiting on some other numbers. In some ways we thought this would be soft but not this soft but the rate cuts in the seven day. Markets are not really reacting as much. Yvonne currency continues to be something traders are ignoring, pboc fixes given the pressures we are sitting on the currencies. Yields are taken higher globally. We could be seeing a scenario of 754 china but looking at how markets do say were seeing slight declines so taking it in stride right now. Maybe a cushion in markets in terms of sentiment. The retail sales print is the lowest we have seen since last december. National bureau of statistics should start their press briefing to give more context. And we have helen chow out of bank of america. What do you think . The july numbers look weak. Given that we already saw the rate cut a few minutes earlier i guess that is no surprise. Pboc is already shifting away from that mentality of even if we cut by 15 basis, what good will it do . Will it make a huge difference . Two now where like, we better do something or it will keep getting worse. And then we could be blamed. So we think the central bank mentality has clearly shifted since the previous cut and now they are being more responsive. Yvonne are we starting to see signs of weakness in the property sector hitting consumption on driving did down driving it down . Indeed. We looked at the retail sales. It has a catch which is it his of consumer goods. It does not necessarily include enough services. In july the Consumer Services were booming. The box office was at an alltime high. Transportation was ok. Consumer Product Sales were not doing well. And compounded by the fact that it is a nominal series in the cpi inflation was really low so that probably contributed to it. When do measures announced it start to show up . Weeks or months . In theory we should see them now. I would say the meeting has effectively created hope for the market that something can be done relatively soon. I would say they could have started with something easier like Interest Rate cuts and adjustment in the Property Market like the restriction mortgages. The housing purchase restrictions does not cost anything for them to remove it. That should be the first step with restrictions on mortgages. We are hearing that secondtier cities are starting to do it. Yvonne and they could be moving some of the debt on the local government level two provincial. Is that a sizable move of how they resolve the debt issues . We think that is probably the most important point they have measured during that meeting. Before the meeting, most were saying it is a longterm problem and because of the potential hazard issues no one should be bailed out and the Central Government should not do anything. That was before. But when they saw it in the readout people suddenly realized that top decisionmakers solve the problem and they are about to address it. The comprehensive package basically means you do not have a one cut fits all, onesizefitsall cookie cutter approach. You need Different Things to address. Publicly traded debt, trust loans, commercial bank loans. So we are waiting for more indications to come out. What is that specifically, when you move some of the high risk debt to provincial, i think they will issue bonds, to then fund some of the debt, what does it do in terms of unlocking Infrastructure Spending and they are also transferring the loan and what does that do as far as the debt loads . It is trying to do where at the point where that household sector has a lack of confidence to lever up and invest we need the Public Sector to invest so we do they get the money . For local governments it is very difficult to borrow more and compounded into the high debt servicing costs so two things need to be done. Restructure the current debt stock to extend maturity and lower Interest Rates and create a new channel for them to borrow hopefully by leveraging on the Central Governments Balance Sheet, not local, so they can borrow and then invest as soon as possible to create jobs so that is what needs to be done. We think the direction is clear. Proposals have been submitted to the top decisionmakers already and we think it is probably brewing at the moment. Yvonne is it enough to avoid a hard landing in the property sector . Its probably not designed to help the property sector in particular. We think that is increasingly showing it is no longer just the cause of the slow down but also partly the consequence of it and the lack of confidence so we need to see demand and supply side to help support that needs to be given to the property sector on top of all of the local governments and fiscal approaches we just mentioned and only together we think it could probably put a backstop to the current slow down and we could see growth stabilization in the fourth quarter. We have more lines coming through. National bureau ofs resistant bureau of statistics that we need to boost confidence and domestic demand remains insufficient so what are the most important if you have to pick one data point what is the most important to watch moving forward . Money and credit. Data last friday that came out was not particularly there was the problem that july was not the end of the quarter and so there was no regulatory pressure for Financial Institutions to extend lending in those months and so it looks lower than previous month but it happened against the backdrop that overall demand was weak so Credit Demand was week as well. Growth forecast . We have 5. 1 for the full year. We think right now we see some Downside Risk to the number if third counter Third Quarter ends up being worse than expected but we think there is more room for easing and still hope. Helen chow, that was great. Thank you so much. What are we doing now across the markets . We are mostly up across the region with the exception of hong kong. Metals are in play. We have seen a lot of contracts come under pressure. Metals with a bit of a bouts today. Yvonne iron ore seeing upside half of 1 . The biggest move we are seeing now is chinese 10 year yields down five basis points this morning. Going back to the 2020 lows when it comes to that chinese 10 year yield and we do not normally see moves like that. 256 with a yield across what most part bond markets are doing which is yields are melting up. Hong kong stock continues to be week. We are extending the losses and sing 1 losses seeing 1 losses. The initial optimism over the mls cut seems to have faded and now we are extending it further after the data came out. What is coming up on the show, our exclusive interview with the his approach to keep a peaceful beijing later this hour. Some big moves in the fx market and what on anchoring of the chinese currency white unanc horing of the chinese currency might mean. Nbs data has been released. More commentary, analysis, and news coming up. This is bloomberg. How can you sleep on such a firm setting . Gab, mine is almost the same as yours. Almost is just another word for not as good as mine. Save 50 on the sleep Number Limited Edition smart bed. Plus, 36 month financing on select smart beds. Shop now only at sleep number. And your store was also the first time you realized. Well, we can do anything. Cheesecake cookies . The chookie manage all your sales from one place with a partner that always puts you first. we did it start today at godaddy. Com oh, booking. Com somewhere, anywhere. I just want to lie motionless in a chair booking. Com, booking. Yeah about a set of numbers in terms of activity data in july, a bad set of numbers in terms of activity data in july. China to stop publishing data for the youth jobless rate. This is something most of the market anticipated given the record highs we saw with youth unemployment, north of 20 in june. So it is interesting that they have stopped publishing the data. Some sources are telling us there might be some intervention happening with the currency. State banks are buying the dollar against the currency may be as an initial backstop. Rate cuts will put pressure on the currency. Lets put everything together for you on fx markets. Our macro strategist is in the singapore. 730, we are past that now on offshore rate. When we get to the onshore rate . Its consequential. What we see is the offshore yuan [indiscernible] some analysts were saying we might see more forceful intervention from authorities to maybe rein in some of the but this is symptomatic of the chinese economy. Industrial production and retail sales missing a stimulus and this echoes the data that has been week coming in and another key level traders have been watching [indiscernible] so if the offshore yuan falls past level so it seems it despite the fixing adjustments by pboc will be intervening but for now it looks like the offshore yuan might be followed falling further and less in the sense they turn it in that chinese economy. Yvonne weakness in china and strength in the u. S. Dollar and renewed strength in the greenback less hawkish and the 10 year in the u. S. The highest since 2009. Are there any external challenges to challengers to the dollar dominance . What you looking to be weakening further and to me [indiscernible] look at europe. Growth in the eu is not as robust as the u. S. The boj has been tweaking the yield curve target but Analysts Expect the boj to stand for the rest of the year which were not support yen strength. Central banks in chile, brazil, they may poll back on the em kerry trade and this would all be supportive of the dollar. Yvonne right. Marcus wong, thank you. Lets bring back helen chow. I was going to talk about the renminbi but the line about them no longer publishing the youth unemployment data, what does that tell you . They say there are complexities in the surveying. Very have been increasing challenges in terms of analyzing the data. I would say this is one of many events related to it. When we look at trade data from last week there was substantial revision to the previous nine months of data in the base. So you look at the headline and you think you know what is going on but you dont because the base has been shifting and there were other changes like the frequency of publishing data has largely changed. Consumer confidence now has a lag of reporting of three to four months. So it is not making macro analysis easier. Thats why we need to smart people like you to tell us how consumers feel now. We do have some alternatives. In our surveys we ask 45 or 50 questions and have a sample of 1000. Each broker has Something Like it and we glean a lot of data from it and we have to depend on that more and more. What are your surveys saying . We are waiting for the next to come out next week but in the previous ones we were still seeing some positive signs that Consumer Confidence is gradually coming back and people are committing in the survey that they will spend more compared to previous months and are more willing to come outside of china, overseas travel, that is the positive news but in the meantime people are worried about potential property prices coming down and we do not see enthusiasm in purchasing properties. Yvonne talking about the renminbi, we touched on the offshore rate. Despite beyond stronger fixes is there more policymakers can do to stem the weakness . They could come with some administrative work preventing the capital flow to go out very quickly but at the same time we have to reckon the fact that between the dollar and one the interest differential has widened significantly. For many investors a realistic question is if i get riskfree of 5. 5 in the dollar why should i invest anywhere else . So even if they invested in china in the past now is a choice to think about where they can earn the 5. 5 as a deposit of a not to mention that we are also seeing for exporters who are receiving all this, cashing it out as soon as possible, even by using they would just send it out and put it in u. S. Dollar deposit account. That can already offer you 5. 5 percent so at the moment this is very hard to resist because of the interest differential. Generally where do you think the currency goes . Is it a big deal if we see 750, given the underlying academic suggesting that is where we are going anyway underlying economic suggesting that is where we are going anyway . We see improvement in 2024 and 2025 mainly because we think the dollar trend would come to an end. The strengthening would probably turnarounds and the fed by that finish of fed pivoting. Yvonne where in the economy do we need more support . Consumption side . Yes. Consumers would enjoy a potential support if there could be some nationwide consumer Voucher Scheme being lifted. At the moment i think the only local government saying it is up to you, if you want to subsidize your consumers, do it on your own expense, but we think it makes perfect sense at the moment for Central Government to consider coming up with some proceeds, potentially funded by special government bonds, and then distribute to people. You could give it a cap or uniformly to everyone but we think that could potentially help if you set a limit on how quickly you need to spend the money. I am sure you have looked at some figures that what about what that might help and look like. We suggested one point 2 trillion roman worth of special Treasury Bonds could finance large amount of the consumer purchase program. Scholars close to the government suggested they could probably do 1000 per person and others suggested if we are going by the income levels, those that are not currently paying income tax, we can pay them more and that is another suggestion. In either case it will not cost significantly above that but it will be helpful in boosting confidence. Yvonne it helped here in hong kong in some ways. Mind is gone. [laughter] i wont tell you what i spent it on. Yvonne it goes quickly. Helen chow, thank you. You can look at the bloomberg terminal on tliv. They might be talking about why they stopped publishing the youth unemployment figures. Plenty more ahead. We will be back shortly. This is bloomberg. upbeat music woah. Constant Contact delivers the Marketing Tools your Small Business needs to keep up, excel, and grow. Constant contact. Helping the small stand tall. Welcome back to shows. We have been talking about china and the narrative has been if bondholders will get a haircut and they got a rate cut. 1. 8 , 2. 5 . 10 basis point cuts on a sevenday and 15 on the mlf so we are looking at 10year yield when we talk about this. Yvonne continuing on the rally we are down five basis points earlier so we are at 2. 5 seven for the 10 year yield treasuries, the 10year yield is back above 4. 2 . Given the risk on moves we saw despite what was going on in china we saw still bonds on offer. We are very near cycles highend with falling inflation expectations, the dollar will be stronger. All things equal david we had ap print which we will get to. Anybody who was completely captivated by that macro environment, completely by surprise. Yeah. And they would have missed most of them would have missed that rally if they were solely focused on Interest Rates. Marvin, ill bring you in. Speaking of Interest Rates, we had a surprise out of the pboc two rate cuts, not one. This is a very policy driven market. Where do you see it going . Yeah. So, you know, like as gina mentioned in in the us earnings matter, but right now here in china, were seeing kind of a policy driven market where the macro matters more from regulators. Weve gotten the policy blitz in july and were seeing some sense of urgency with the rate cuts today given todays disappointing macro data. So its easy to understand the urgency there. But you know, for sustained momentum in the equity markets, we think that we really need to see the effectiveness of these policy moves before and that may take a while. What are you expecting . I mean, youve talked about maybe record equity inflows this year. If we do see this kind of policy blitz turn into action, how are you crunching these numbers now . Yeah, the i mean, were still tracking one of the best years for inflows, largely because of the surge in january. But one of the concerns is the weakening currency that all of this monetary easing is bringing. We think that may be a limiting factor. And you know, further weakness could drive capital outflows, you know, bring you back in the this correlation between fixed income and and equities. Its a debate whether, you know, the last 20 years is now starting to change. I mean, weve certainly seen a change. And whether or not we revert back to 20 years norm or we revert back to the normal before the previous 20 years, why is that an important conversation to have . Its incredibly important because that correlation has been sort of the framework by which Equity Investors have really counted on valuation trends as well as earnings trends and the broader inflation landscape and sort of suppressed inflation volatility, which was our normal environment for more than 20 years now may be gone and we may now be contending with an environment in which inflation is much more volatile, even if its not always higher, just that volatility in and of itself creates major changes in the earnings landscape, particularly with respect to margins and those margin changes can drive earnings trends, which then impact stock prices. On the other side, youve also got the impact of fed policy and where the rate landscape lies. You know, the fed really didnt have to worry about inflation. Surprising to the upside for the vast majority of the last 20 years either in particular the last ten where deleveraging was the predominant case in the us equity market, in the us economy. If the Interest Rate is higher, reflects that higher average inflation or higher inflation volatility expectation, that also has implications for equities through valuations. So all of it is incredibly important. All of it is also a massive sea change from where weve been and creates a lot of disruption for the Broader Investor base, which is really accustomed to thinking about growth and growth alone, and not especially in the us, not really implementing a whole lot of strategy based upon inflation dynamics. What questions are you getting from clients . Youre in the region. I mean, this us exceptionalism, weve seen for much of this year, i mean, what questions are you feeling . Whats the advice for them now . Most of the questions i get really are still with respect to the macro, it is this captivate with are we or are we not falling into recession in the us . Is it going to happen . Will this inflation sort of deceleration last . Are you worried about the recent rise in oil prices . Thats potentially inflationary in 2024 is pretty intuitive. Question valuations with respect to tech stocks always come up. So the excess valuations that weve experienced, the percentage of the Market Driven by the top seven is still a big question. The questions im not getting are are earnings improving . You know, are they . Yeah. And they are. They are ex energy and that takes most investors by surprise. Sort of providing that intelligence with what has really driven the stock price gains beyond sentiment has proven to be somewhat not conducive to the conversation over the course of the last couple of days here in asia. I think that the more disclosure we can give with respect to whats really going on and whats really driving stock prices beyond that macro story, its been generally pretty exciting conversation. And if you mentioned inflation and thats one of the key risks next year, what does that do to margins and earnings . I think this is a great question because the downdraft and inflation or the disinflation that weve really been experiencing for the better part of now 6 to 9 months has helped enable some margin stability on the s p 500. When you look outside of the Energy Sector and even though all overall margins are coming down because of energy, the rest of the market is starting to experience some margin stability. If we can keep seeing that disinflation trend in an environment where Revenue Growth remains relatively stable, volume sales remain relatively stable, we could start to see margins improve materially, which would be a big tailwind for the us equity market. So its something to watch really closely. In particular, Producer Prices which have historically been very indicative of future price trends for the s p 500. If those Producer Prices keep falling, they keep, you know, stabilizing over the course of 2024, it could be very positive on the inverse of that if they start accelerating again, weve got to worry about whats coming in 2024. We dont have an inflation problem in china. Marvin, i wanted to talk about, you know, all the bad news thats been in property, property, property. What are some of the bright spots that youre looking at . We got tech earnings this week, too. Yeah, tech earnings are expected to be one of the bright spots. You know, not only that, you know, if we look at alibaba earnings, not only are they beating on the bottom line, were seeing good top line growth. So thats something well be watching for. You know, one of the positive signs of consumer recovery. Is it enough to offset, though, the gloom . I think, you know, were in the midst of earnings season. Its its really being overshadowed by a lot of the macro data, the credit issues ongoing in the property and financial markets, earnings taking a back seat to to the macro. Yeah. And gina, on that very point, i mean, if youre sitting at a dollar investor, youre looking at em and you know, china as what, 40, 50 of that basket. Its not not too good. You would have missed the boat completely. Right . So what do dollar investors need to look at when they look at do i need exposure . Do i need china exposure . And how do they say mitigate . I dont know, market cap risk, for example . Yeah. No, thank you for that opening because we have a solution for this. Our quant strategist, kumar gautam over in singapore has actually developed a risk contribution portfolio for em, just based upon the contribution of equities risk to the broader em as opposed to market cap contribution. And that portfolio would have suggested a much lower share of the portfolio dedicated to china than the 40 some percent that china was dominating of the Broader Market as of the end of 2021. So it would have avoided a lot of the risk of 2022 and a lot of that downdraft that we experienced also sort of rightsize this china based upon its historical volatility and contribution to correlation within the Broader Market. So you know, we think that when youre looking at emerging markets, youve got to look beyond market cap. You probably have to get a lot more clever when youre thinking about investing in em and just dumping a bunch of money into the msci index has not worked for 20 years, so im not sure its going to work going forward. I think a risk contribution approach is probably a lot more appropriate. Gina its great to have you here in hong kong. Gina martin adams there, bloomberg intelligence. Also want to thank marvin chen, our china equity strategist as well. Weve got some lines here from the National Bureau of statistics in beijing. Of course, on the back of this weak set of data numbers that we got out of china, still playing down the whole deflation issue youre seeing here that china will see deflation. Oh, theres that word again. They will not see deflation. Next stage and that the cpi decline line is likely temporary. Thats basically what theyre talking about. I think that was one of the first questions coming out from reporters from this briefing was about, of course, the deflationary pressures in china. Yeah, not to last. Okay. There we go. Well take you back here once we do have more information on that in case you missed out on the other headline, too, is that they will stop publishing youth unemployment figures. Youre spotting something. Also, problems facing china, property companies, temporary as well. So really playing down the two key things that i think economists were really talking about in terms of the pressure on the economy here, property as well as when it comes to demand inflation, the like here. Coming up, were going to talk about taiwan, our exclusive interview with the taiwanese Vice President , li jingda, as he campaigns to become the islands next leader. His views on keeping the peace with beijing next. With beijing next. Did you know you can get someone to shop for you . With stitch fix, it couldnt be easier. I share my style, size and budget. And they shop just for me. My shopper sends me stuff i feel good in. I keep what works, and send back the rest. Stitch fix. When you automate sales tax with avalara, you dont have to worry about things like changing tax rates or filing returns. Avalarahhh ahhh of hands as he campaigns to become the selfgoverned islands next leader. He spoke exclusively to Bloomberg Businessweek in his first interview with International Media and told us about his plans for managing relations with mainland china. When. He also also the us. We must abide by the truth, which is what i mean by pragmatism. It is that taiwan is already a sovereign, independent country. We called the republic of china. Its not part of the peoples republic of china, the roc and prc are not subordinate to one another. It is not necessary to declare independence. What is your roadmap to formal independence . You use the. My responsibility is to maintain the status quo in the Taiwan Strait while protecting taiwan and maintaining democracy, peace and prosperity. So no such framework exists. We must work to maintain the peaceful status quo because taiwan is already a sovereign country. China keeps pushing on the status quo and it keeps pushing. Its fired a missile over taiwan. Its crossed the median line in the Taiwan Strait and its simulated a naval blockade. What is your red line . The increased tensions impacting the status quo in the Taiwan Strait have not originated from taiwan. They are due to chinas growing assertive ness. China not only seeks to annex taiwan, it also hopes to change the International Rules based order. Under these circumstances, we must be clear tie one security is of International Concern in peace and stability in the Taiwan Strait is aligned with the international interest. So we. Because challenges in the Taiwan Strait are a global concern, a global red line will also be taiwans red line. And my personal red line in ukraine. President Zelensky Rose to meet the challenge when russia invaded. What did you personally learn from his leadership . Means democracy is a universal value, irrespective of borders. President zelensky rallied his people to resist russias invasion. An they are protecting not only their country, their land and their people. Well, they are also fighting on behalf of our democratic values. How russias unprovoked invasion of ukraine has led us to see that dictatorships are inherently unpredictable. We must make the best preparations for a worst case scenario. We also see that president zelenskys courage as well as the support they sought internationally, all contributed to ukraines resistance against the russian invasion. We have a deep understanding that we must avoid war in the Taiwan Strait. There are no winners in war. Peace is priceless. From the war in ukraine, we see that we must do all we can to avoid war in the Taiwan Strait. Youve said provocative things in the past, but that will be a interest in washington. How have you changed taiwan . I have been part of president tsais National Security Team Together with the us government, we have responsible and Clear Channels of communication. We are able to share information effectively. We understand where the issues are and cooperate in resolving them. This election is about choosing between two roads. One way is to continue engaging and cooperating closely with the International Community while deepening our democracy. The other choice is to accept the onechina principle and stand together with china. I believe the us will continue to support us on the first path. How . How confident are you that the us will have taiwans back . Should the situation with china escalate the war set taiwan . How . The us is a close friend of taiwan. We are partners in a number of areas from politics, the economy, human rights to our society. With taiwan. The and because taiwans security challenges are a global concern in the upkeep of peace and stability in both the Taiwan Strait and the indopacific region, fulfills the common interests of the International Community. I believe that all democracies in the world, including the us, would be aware of how to respond if such a scenario were to take place. If the us wants tsmc to build more chip fabs in the us, would you stop it . We in the Semiconductor Industry is not just made up of 1 or 2 fabs. There is an entire ecosystem. Tsmc advanced processors are located here in taiwan. Their base is here in taiwan. So if they choose to set up operations in the us or other countries, this is an expansion of taiwans economic power. This is also part of the restructuring of Global Supply chains. I would take these developments positively. What do you want the world to know about you as a person . Was the i am a rational and steady leader. I know how we can respond to the challenges we face as a country. I also understand that the serious and complex nature of issues in the Taiwan Strait call for rational and steady leadership. This will enable our country to move forward amid changing geopolitical circumstances. That was the taiwanese Vice President and dpp president ial candidate ching does speaking exclusively to Bloomberg Business week editor joel joel weber there. And you can read all about, of course, those views in the cover story of the latest Bloomberg Business week. Of course, check that all out. And that interview is also the subject of todays big take. And we have more on that right now. Yeah, for more, lets bring in our deputy Taipei Bureau chief, cindy wang, who also was authored in that big take as well, who came up with this story and really, really what the broad implications is of of lie running as the dpp candidate, cindy. I mean, there was a lot of talk in this conversation with lie about china. How much is the threat of conflict with the mainland really a defining issue in this president ial race . Hi, yvonne. Yes, the tension with china is really the Biggest Issue in taiwans president ial election. People tend to frame the vote as a choice between two, but everyone has different interpretation about what the two choices are for lie, he says. There are two ways. One way is for taiwan to continue engaging closely with International Community while at the same time deepening taiwans democracy. Or the other way is to accept the onechina principle and stand with china. So he believes that the us would of course support taiwan on the first pass. But for the opposition campaign,. There are two candidates now. There are, howie, from the opposition kmt, and also from the taiwan peoples party. So they believe that they frame the the vote as actually as a choice between war versus peace. And they believe that if people vote for lie, that would actually means voting for war while voting for the opposition candidate would be. That would mean voting for peace. So they are arguing that its really important for taiwan to have more conversation and exchanges with china because thats the only way to reduce the risk of war. And that takes us perfectly into the next question. What is his approach to mainland china. Yeah, so lightning does spoke to us during a series of interviews and he actually speaks decent english. But most of the interviews he decided to speak mandarin. The point is that he wanted to be cautious and wanted to get his message right. So he says he says this part, particularly in english, though thats very few in the interviews. He says that we dont want to be enemies with china. We can be friends. And as long as there is parity and dignity, our door is always open to china. So he thinks that as long as there is parity and dignity, taiwan is willing to have the dialog with china. So if beijing doesnt want to talk to taiwan, thats beijings problem is not taiwans problem. So in beijings point of view, this may not be enough for taiwan or for dpp to say Something Like that. But lacking right now is trying to convey this message that he could be a steady pair of hands and he will strive to maintain the status quo across the Taiwan Strait. So anyway, great work from you and your team there. Deputy Taipei Bureau chief joining us with the latest on that lie feature piece there. We got plenty more ahead. Just some lines crossing here from that briefing in beijing, china will actually resume the youth job data after surveying optimism asian. We got plenty more on that. And what that all means coming up. This is bloomberg. Fabulous surroundings, but everyones looking at their phones for Financial Insights from merrill. Is he hailing a ride to the concert hall . No. Hes making sure his portfolio and retirement plans work in harmony. They want to adopt a child and build a new home. So theyre talking numbers with their merrill advisor. Shes not researching her next role. Shes learning how to handle market ups and downs without the drama. Personalized advice so impressive your money never stops working for you. With merrill, a bank of america company, what would you like the power to do . 76 of 23 andme. Health customers surveyed reported taking healthier actions because they know health isnt just a future state of health. Happens now start your dna powered Health Journey today with personalized insights from 23 and me. I need a cooler night. You trying to ice me out of the bed . We only on game nights. You know youre retired, right . Am i . Yeah. Say 50 on the sleep number. Limited edition. Smart bed plus 36 month financing on select smart beds. Shop now only at sleep number. This is mariannes first time visiting paris. Well, you, um. Before long, marianne packed her bags before she attempted her first sentence in french. She downloaded babble. So when it came time to tell the cab driver to take her to the hotel pierre shimmery ali lhotel. Pierre babble focuses on natural conversation. You can speak and pronounce with confidence. Start speaking in new language in three weeks at babble. Com. Um. All right. Oh, the cameraman, almost right on cue there as we come back from the advert break straight back to the spokesperson there of the nbs. Well, a miss across the board on the monthly indicators, including some that are year to date. Theyre now talking about this youth unemployment issue and theyve said that theyll stop publishing it for now until they work out some of the surveying complexities. But it will not affect the Overall Survey jobs numbers. Jobless rate data is what is what theyre saying. Theyre yeah, certainly one to watch. Okay. We are getting some lines here on donald trump here. The former president indicted in georgia over that 2020 election. But well have more on that coming up. This is bloomberg. 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Some things are better left to a professional in hindsight. Probably shouldnt have tried to remove my own appendix like when it comes to finding Financial Advisors. What was thinking . So leave it to smartasset to find them for you. Take the free quiz at smartasset dot com. Then youll be matched with up to three vetted fiduciary Financial Advisors to get started. Take the advisor match quiz. Now smartasset. Com. It was this close. This close. Or other authorities could face bigger challenges. Next was going to keep rain world cup. This is a three as the economic picture does okay is getting ready to make a decision. Its almost 11 a. M. In singapore in shanghai. Welcome to Bloomberg Markets asia. Im haslinda amin. And im david ingles. Im here in hong kong. Are your top stories today. Activity numbers across china confirming the weakness just about a miss across the board there. Retail factory activity, investment in troubled property sector. Take your pick. Plunging more than expected, more than 8 . In fact, on that latter print. Well get more on that in just a moment. The data dump as you can see, following the surprise size rate cuts, plural. So you have the one year lending facility. You have the seven day repo rate that sent the yuan and bond yields tumbling along with the most parts, most parts of this chinese equity market. And meet the man who could be taiwans next president , beijing tells us exclusively how he plans to reassure voters and maintain the peace. Welcome to the show. Hope youre all well. Its been busy morning. And speaking of voters here, breaking news these last few minutes or so. Donald trump has been indicted in georgia over the 2020 election probe weve been tracking. Weve been looking at this story because there was really a possibility that wed be getting these headlines at some point. 19 defendants are named in that fraud case. And going into that, some of the probes and some of the defendants include Rudy Giuliani and mark meadows. But the headline tells you everything you need to know for now. And well get more details on this in just a moment here. But donald trump is indicted in georgia over this 2020 election probe. Thats what we have so far on politics. I promise you well be revisiting that in a couple of minutes once we have more details on that story. In the meantime, though, has what are you seeing across markets right now . Well, were seeing red when it comes to china for sure. And of course, that indictment, the fourth one for trump this year. It is a pivotal day for investors. Today. We had that china data dump suggesting further weakness in the economy. Weve had the pboc trying to save the day, cutting mlf by 15 basis points, injecting ¥1 billion. Also cutting of course, the uh, the triple r in a bid to save the economy. But the question really, dave, is, is that enough . When you take a look at chinese assets, you get the answer. Csi 300 index in negative territory, extending its decline, down 3 10 of 1 . Take a look at the yuan. It is in negative territory as well, down 3 10 of 1 , reaching that one, uh, 730 level at one point, which is the psychological level. And we take a look at a ten year yields in china down about five basis points, the lowest level in more than three years. So when it comes to investors, they are negative. And whatever was done today is not enough. Though in the Broader Market, some solace, i suppose. Were seeing gains in the nikkei, 225, up 8 10 of 1 . Also gains for the asx 200 index in positive territory. Were keeping a watch on the kiwi by the way. Right, because on the back of the rbnz decision expected tomorrow is likely to stand pat. So that is a sense in the market today. It is about china. Yep, a second straight time. To your point. The rbnz is expected to stay pat and certainly rate differentials. I mean, its everything exchina thats thats if you had to sort of describe crossasset moves right now there is your number, there are your numbers right now, activity numbers, just about a miss across the board. Some of the people weve spoken to since the data released are pointing out that very weak retail sales number, some of the properties coming through, i mean, aussie dollar is weak anyway going into this number. Were a little bit higher on that. Have a look at oil where we are on that. Were going for eight weeks of gains. If we get number eight, that would match the longest win streak or streak of gains in oil this century. There we go. Doesnt happen as much iron or slightly lower in that your medium term lending facility. Just a great cuts the 1015 rather theres a ten which well get to in a moment 15 takes you back to 2. 5 1 billion net injection there and your ten year yield, five year look, were back to levels as thats pointing out, back to 2020. You dont normally see this move by 4 or 5 basis points, but that is certainly gives you an indication how the market perhaps was not as positioned for the news flow coming out of china today for more context, lets bring in our china and hong kong economists at Bloomberg Economics, eric zhou. Hes here with us. Your initial reaction . Its obviously not a good start for the second half of the year. Its a broad based slowdown in all the major activity indicators and investment, retail sales and also industrial production, including the exports we have seen earlier in the month. Right. So its not a big its not a good picture. And thats why they probably explain why the pboc cut the Interest Rates by 15 basis points. As i remember, thats probably the biggest rate cut since the cut in the after initial pandemic. Three years ago. Right. So that shows how urgent its, you know, government needs to do, you know, to do something to to to to save the growth for the second half of the year. And it looks they need to do more. Right . So even the Interest Rate cut in the june it had an show a very visible impact so far in the data especially see the data is still showing the property slump, the deepening crisis in Housing Market and the low confidence is still dragging the economy. Yeah, eric, you said the housing credit stress is one factor that investors are looking at. I mean, you talked about how the government needs to do more, needs to do more, what more can they do and are they willing to do it . Yeah, we have just seen the housing data also released today and theres no clear sign of turning yet. Right. Its home sales, home Property Investment are still in a deep slump and we think they definitely need to do more on the Property Market in order to stabilize the market, including more relaxation probably in those top tier cities. And trying to boost confidence in in the market in the home buyers and and of course, the pboc also needs to do more, including triple cuts and Interest Rate cuts. We would expect in the next quarter, even after todays Interest Rate cuts. Right. So its its. Yeah. Eric, thank you so much. Eric ju there of course out of Bloomberg Economics here. Lets get the market angle to this move by. Hes with us here on set. Head of asia trading strategy at Citigroup Global markets nice to see you. I mean, i want to ask you, what does it mean for markets . Sometimes these are not connected, but the market seems back in its slumber again here in hong kong and in greater china. Yeah, i think theres a few things that are going on. Clearly, the chinese equity market has got very negative sentiment towards it. Foreign investors have been leaving. We saw very heavy selling in the china ashares last week. Yeah, the dollar is strengthening as well. And then weve got results coming up in the next few days. Traditionally, this is actually a weaker month for the chinese equity markets because the the Chinese Companies normally they they promise well, and then disappoint on earnings whereas in the us they promise quite bad things and then yeah so theres always a positive earnings surprise in the us compared to a negative earnings surprise thats happening normally in china. But at the moment clearly sentiment is very negative. Were looking very closely at this hfinancials index at 12,200, which we think is a very big level for the market there. Why . Well, what weve noticed is that, you know, sort of over the last 15 or 16 years really going back since 2007, every time the hfinancials has been there, its been marked with something significant going on with financials. So 2008, we had the financial crisis. Im not saying that were there yet, but even ten, 12, 13, 15, even 2020, we managed to get down to that level. Now, the interesting thing about where the financials are positioned at the moment is that if we get down below this sort of 12,000, 12,200 level, the positioning is really very weak and 2023 is really a year where you need to look at positioning very, very carefully. So all those people who bought from sort of october 31st to the end of december, their positions will now be under threat. If there isnt more regulatory action that is forthcoming. So we had this sort of opportunity. We first got down to this level at the end of july. We saw more noises coming from from the authorities. The market bounced and then it seems like the market was disappointed. And weve gone straight back to where we were. Mo, want to talk about the impact of the property sector on the economy. Is it at a critical juncture . Is that why we saw the cuts from the pboc today . Yes, i think, you know, its not surprising that you are getting measures from the authorities at this level. In fact, this is really what we would expect. The real question is whether its enough or not. And that goes to your earlier question, is that, yes, theyve cut 15 basis points off the the rate, but the the problem, i think, is not really one of liquidity. The problem is, is i mean, there is no liquidity problem in in china. Money supply is growing. At Something Like 11 or 12 . The problem is really whether that money is being used. So in some forms, its a bit of a liquidity trap and it needs more measures from the authorities to address issues like confidence. Yes. Mm so when it comes to the property sector, are contagion fears justified . Its not just about Country Gardens also about the trust company. Thats a lot of concerns there. It is. I mean, theyre sort of spreading, but i mean, the thing is that, you know, when we had those property concerns in september of 2021, the authorities actually moved quite quickly to to ring fence the financials. So its interesting because this is something that we do know about. Remember, there is Something Like 1. 2 trillion worth of property debt that is either distressed or vulnerable. I think the problem here is that the market doesnt really know who is going to be left owning this and what the impact is going to be. And so what the investors seem to be doing even today, were seeing selling continuing in in the banks. What theyre doing is theyre actually selling first and then theyll theyll ask questions later. But, you know, the the consequences of this, whenever there is some sort of financial issue is always is trying to identify who owns the exposure and and how theyre going to handle that exposure. Now, im looking at the hang seng index, for example. I mean, thats been bobbing around, lets say lets call it 1818 to to 20,000. And is there anything to suggest that thats breaking out of its range any time soon . In other words, is that a buying opportunity . Anytime we approach 18, is it a selling when you approach 20,000 . I think at the moment i wouldnt be looking to buy it. I think the dollar is still going to go bid. I think the hate financials, if they i think thats really the key. The tech names also will be vulnerable. And really theres no hurry yet to be stepping in to buy it. I think what we need to see is effectively a liquidity port. And we thought we were going to get one or the markets thought we were going to get one. It was very interesting, though, was that the follow through buying, even though the market rallied from 18,000 up to about 20,000 and the the actual cash buying, we detected was actually quite low. How people were positioned was really through call options. So really conviction levels were very low. And then as the markets pulled back, what theyve done is theyve just unwound those call options. Your views on chinese tech. So we had Michael Burry ditching alibaba, ditching jd. Com. Is there a value at all in owning chinese tech at this time . I, i think theres a question about owning tech anywhere in the world at the moment, not just in china. I think, you know, tech shares, particularly outside of china, have been in a bubble. The problems clearly are very different in china compared to elsewhere in the world. And again, what the investors seem to be waiting for is a signaling that the regulatory crackdown is over, not just within tech, but across the whole of the economy. Now, i think what weve been seeing is some some in some ways mixed messages. We see messages from the government saying that they want to encourage tech again, and thats positive. And then we see sort of measures against things like the health care and the pharmaceutical sector, which are again, causes investors to pull away from from buying. So at this moment, i think still theres going to be probably better off buying opportunities at the end of this quarter, maybe going into the fourth quarter. Now stick around, mo up buy from citigroup. Global markets will stay with us. Still ahead this hour, we get exclusive access to the leading contender to become taiwans next president. Joining leitzinger on the campaign trail, more on his plans for keeping the island peaceful and prosperous, coming right out. Keep it here with us. This is bloomberg. 100 multiple breakouts as weve moved past the highs of last year. As you can see, theres some momentum from one indicator. The thing is, do i chase this . Do i lean into this or is this a false positive move . Apple buys with us right now still out of citi. What do you think . How do i do this . How do i trade this . Weve been very skeptical about this market, especially since about midmay onwards. So until midmay, really from the financial crisis, till midmay, what you had was equity markets very closely tracking the Global Central Bank balance, which financial crisis . 2008, 2008. Okay. Very long time ago. Okay. So we have is the markets reaching the most overvalued level relative to those of Central Bank Balance sheets that weve had since 2008 . So what you really need to argue here and we saw this actually previously in 2013, markets tried to believe that this time was different and it wasnt at that time. Of course, we had the european banking crisis 2020. We thought again, this time is different. And of course we had covid and it wasnt. And this time what is different is, is that in 2013, Balance Sheets were expanding, 2020 Balance Sheets were flat. This time, Balance Sheets are contracting and the markets expanding into a bubble. And so were very concerned about how this is working out. And remember, us ten year real yields are at their highest level again since 2008. So, you know, in the past it was tina, there is no alternative. Yep. Well, now i think its the age of sarah safra as a real alternative. And i think the market has been viewing god. Well, hold on. I havent finished yet. Yeah, the market has been viewing the fed as janet. Just another empty threat of raising rates even more. And i dont think it is because i think what is happening in the us is that theres a lot of people who are actually benefiting from rate hikes in terms of the interest that theyre earning on savings. So for example, in the uk there was a report from the bank of england that said, yes, mortgage. Payers were paying 14 billion pounds more in interest, but savers were actually receiving 24 billion pounds more in interest. And this is not really how monetarism works. So the way to get inflation down and under control will actually be to get equity markets lower. So cash is the problem or cash is competition, is that what youre saying . Cash is competition and now bonds increasingly are becoming a competition because youre getting a real yield on them. And youve got equity markets at levels where even the most bullish projection is maybe ten, 15 higher than where we are. But if this is wrong and the Balance Sheet is the real thing, that markets will revert back to, a lot of numbers are suggesting the level down to around 3200. So if you look at the correlation between, for example, pe multiples of the s p against ten year us real yields, well, since may, it hasnt really worked because the markets been in this bubble. But if you take out the period from may, what it would suggest is that the market would fall from an 18 times multiple to something which is a lot lower. So mo, is that too much complacency in the market . If you take a look at treasuries looking pretty calm. I mean, so much is priced into rate cuts coming in the next one year. I think that there is some complacency there. I think it will be very interesting to see what mr. Powell says, that jackson hole, in terms of guiding on that, you know, the retail sales figures this week will also be very interesting because i think what it will show is that, you know, because of this effect that i was talking about with the rates actually being beneficial for a lot of people, retail sales, i think will actually be holding up relatively okay. And so what the market is very complacent about is these rate cuts that they think theyre pricing in equity markets are very calm, equity volatility markets even calmer. But we are starting to see some pressures that are building up in the bond market and also in the market and bond yields for the first time in a very, very long time. Like i said, the us ten year real yields at their highest level since 2008 and we think theyre going higher. We think theyre going to somewhere around 1. 75 from about 1. 51. Currently. Thats right. And bill gross says that ten year yields fair value is 4. 5 . Do you agree. I think there is a case to be made for that. And i think the thing is that what the market i think, is not completely appreciated is the impact of the move from the bank of japan. So our view is that the bank of japan is going to take ten year jgb yields up to about 75 basis points. And really what the empirical evidence is showing us is that as jgb yields go higher, it takes up us treasury yields with them and it actually takes up aussie bond yields with a beta of about one and a quarter. So if youre going to get a move in jgb yields from 61 to 75, then what that would indicate is that were going at least to somewhere around 333 on thats the previous high on us ten year bond yields. Oh, okay, thats a problem. So dollar yen goes how low and how you know, and in what way does it pull down the nikkei 225, i guess. Well, the dollar yen is if we get to 75, if we get to 75 at some point. Yes, we do think that, you know what the optimal level is for global inflation is for the yen to strengthen here. If you get the yen weakening too much, then thats actually its not that bad for the for the us, but for japan it will result in an inflationary problem. The interesting thing here, though, is that, you know, people have been calling for the renminbi to get weaker and of course it is weakening. But we dont our numbers are not indicating that weakness in the renminbi will actually cause a reflation in china. So the one thing that causes me to be a little bit more positive on bonds than i ordinarily would be is that if the renminbi weakens, what that does is actually causes or results in more disinfo action in the us. So without that youd be a lot more bearish on on on bonds. So if youre investing in treasuries, you do need to keep a very close eye on whats going on in the renminbi because the renminbi alone, depreciation by the renminbi is not going to be enough. We think, to reflate the chinese economy. Yeah, but in some ways this inflate the problems we have in inflation in the us. Mo thank you so much. Mo. By the out of Citigroup Global markets theres plenty more ahead. Markets are generally okay exchina that is well get you a full market roundup of whats taking place. Were headed into the lunch break in a couple of minutes on the onshore markets. Were off by about a quarter of 1 on shcomp. This is bloomberg. Oh, you got everything that i need . Oh, oh, cause its my sunday morning. Its my sunday morning. Oh, we got it at we get the importance of Clear Communication and when your teams are spread out, thats not always easy. Our experts can help by implementing poly audio and Video Solutions to keep you connected from headsets to collaboration tools. As poly solutions offers simple setup and eliminate distracting background noise. 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All right, welcome back to shows last. Whats four minutes before we head into the lunch break on shore . A glance across across some of the equity markets right now. Were looking at banks following the rate cuts, i guess in some cases. Does it eat into margins . Well find out. Really commentary these next few weeks when the banks start reporting csi 300 banks index on the way up. In fact, there. And some of the look underneath the hood here just about every single stock on the csi 300 banks index is actually trading up with the exception of China Merchants Bank has, of course, dave, the china story has a lot to do with the property sector this time. Country garden seeking to extend a maturing bond for the first time, which is a sign of increasing urgency amid a worsening cash crunch that is expected to hit the economy in a very big way. Take a look where we are in terms of the benchmark itself, down about 1 . We have vanka lower by two, but Country Garden on the back of that news in positive territory, up 2. 5 . Of course, a lot of expected actions of further stimulus to back that sector in the Broader Market, some calm the nikkei 225 in positive territory 8 10 of 1 . Plenty more ahead. Keep it here with us this is j. D. Power. Try free at fubotv dot com. All you got everything that want. Oh you got everything that need. Oh cause its my sunday morning. My son is. We got everything that i need woo oh my sunday. Thats all i need. Welcome back. Were headed into the lunch break at session lows on the main benchmark. Sees three hundreds, maybe some would argue its the shanghai comp anyway, were at session lows on the main ones. Plural. As you can see, were a little bit weaker still on the chinese currency and at seven 2746, that actually puts us now, i would imagine within half of 1 of 730, which we touched briefly on, on the offshore rate, 30 minutes left in the morning session. So were coming off lows. Last we checked here on the hang seng index ever so slightly, 18. 5 ticks and now almost back to the bottom of the recent range. And we were speaking with mo appleby and we say, you know, is that a buying opportunity . Anytime you get a dip towards this level . He said stay away largely for now. Other things were tracking here as well. I mean, we are going in. Well, we were past tense going into this morning, looking at six days of declines on well, for one, the high yield space, junk bonds, six days of outflows out of the northbound out of the stock connect. So theres a net outflow. So i guess put very simply, Foreign Investors have been net sellers of of the asian market for six and its looking like today is a fairly heavy day of selling across the stock connect we could get day seven. Were only halfway through and as you can see, were almost at full day levels of about two days ago. And we had fairly heavy selling. So watch this metric very, very closely. Moving. Moving forward has outflows for china inflows to japan, the nikkei 225 back from lunch in positive territory up look at that 8 10 of 1 . Of course this has to do with that beat for gdp. That data out today getting a lift for from that data. The topix also higher by 6 10 of 1 . The yen one 4547 some reprieve today of course yen weakness is expected to persist given that the differentials between yield differentials between the us and japan right now, stability for the yen at one 4548. Well, well talk about that gdp beat for japan driven pretty much by exports, more than offsetting weaker than expected results for both Business Investment as well as private consumption. Gdp grew at an annualized pace of 6 , and that is the Second Quarter figure marking the strongest growth since the last quarter of 2020. So not a bad print for japan. For more, lets bring in bloomberg senior japan economist taro kimura. Taro, whats your take on the gdp data released today. Yeah, the headline figure was actually very, very strong. And as youve mentioned, its mostly its all led by net exports. And net exports has two factors. One is the strong export part that reflects the pent up demand for the car shipments to feel the vacuum of the dealer inventory in, lets say, in the United States or europe, because the chip shortage is improving and the tricky part is the contribution is a contribution of weaker imports, which actually contributed 4. 4 points to annual growth in the headline, which means that the like, you know, it suggests that import import price, imported goods price are getting too high. So consumers are substituting two domestic products that kind of supported the domestic production. But whats concerning more was a decrease in consumption. Although we have a headwind of reopening that would concern the policymakers that that will concern my forecast as well. Okay. Now, you alluded to this as most most of this really good number was net exports. It would have been better if we got a little bit more domestic demand coming in. What is the bottleneck there . Why has that bit been been quite weak. The bottleneck is the wobbly growth in wages recently. Okay. The wage release is disappoint the disappoint and it lags far behind the cost push inflation. We had high hopes with earlier spring negotiate session which resulted in which was agreed in a kind of high rates. But its actually we dont see see a strong sign that overall actual wages are growing that fast. That would be the bottleneck and in recent releases tend to start to overshoot the expectations. So probably looking forward to the three. Q the week wages are still the concern for consumption. Taro kimura, thank you so much out of Bloomberg Economics there, our senior japan economist in tokyo for us from tokyo. Lets pivot back here to hong kong and maybe perhaps most parts of mainland china, country guard. And there we go. Thats your story today to so well. Theyre seeking to extend its maturing bond for the first time after it stopped trading and some of the local notes here. For more on the crisis of whats taking place here at one of chinas biggest developers, lets bring in kevin kingsbury. Hes our china credit editor. Guess, before i ask you how important this extension is, im just confused. Which bonds are we talking about here . Well, theres 11 onshore dollar onshore yuan bonds, excuse me, that were halted in shenzhen. And in shanghai yesterday. Yes. So they are still halted for now. One of them is this bond, ¥3. 9 billion or 535 million that comes due next month. This bond is the biggest maturity that Country Garden has left this year. Its so by kicking this out, by looking to extend this bond, it will give them breathing room to be able to pay off other debts, including the 22. 5 billion of coupons that last week they didnt pay. And theyre currently in the grace period that if they dont pay within by the end of early september, that theyll be then in default. Kevin are there comparisons to draw between Country Garden and evergrande, which defaulted in late 2021 . Im sure there certainly are some. We can start by Country Garden and evergrande, both being at one point chinas largest builder, china or Country Garden excuse me, 2021 and 2022. It was the biggest builder. Now its down to sixth. Same or excuse me, not same story, but same property sales in june and july down more than 50 year over year. Evergrande saw similar declines in 2021. In the months before it defaulted potential home buyers. They were just concerned that the builder wouldnt be able to complete the complete the purchases excuse me that they were looking to build by not being able to complete these constructions. People arent going to buy to evergrande or now in this case Country Garden. Theyre going to go look at other potential builders to produce with. Its a monster crisis, however you look at it. Bloombergs china credit editor kevin kingsbury, thank you so much for that. Now to pivot somewhat in news that has just broken donald trump and some of his closest allies and former top former Administration Officials were indicted in atlanta over efforts to undo his 2020 election defeat in georgia. Lets bring in our white house and politics reporter gregory. Quote greg, tell us what we know. Well, just maybe half an hour or so ago, they a state grand jury in the us state of georgia handed up a 41 count indictment against donald trump and 18 other people for their attempts to overturn the results of the us election in 2020. In the state of georgia, the defendants include President Trump, but hes also his former white house chief of staff, mark meadows, and a whole gamut of his lawyers from Rudy Giuliani, jenna ellis. These are becoming household names in the United States, and it alleges that they pressured state officials to change votes. They broke into voting machines. They harassed the Election Officials and they put forward a slate of fake electors to vote in the Electoral College for donald trump, even though they knew hed lost the election by 11,000 votes in the state of georgia. Yeah. Gregory david here just to mention, too, im sure youre across the story. I mean, the press briefing has begun in atlanta, and were looking at live pictures of that, too, as we as we speak. Gregory let me bring you back then. Okay. So just take us through. Of course, these are racketeering charges. Correct me if im wrong. Point number one. Question number two is what comes next after this . Yes, these are racketeering charges under basically the same statutes that prosecutors will use to go after organized crime. It alleges that there was a conspiracy by more than one person to commit a crime. And that all of these acts there are 161 or so overt acts identified in the indictment in furtherance of that conspiracy. So now we have 19 defendants, all names in this indictment. And the next step, as in any of criminal process here is for President Trump and his 18 codefendants to be served with the indictment and arraigned in court in atlanta, presumably sometime this week. Thats yet to be scheduled, but but weve been through this three times before already this year. This is the fourth time that former President Trump has been indicted. Theres a sort of a script to this where hes brought in. Hes given somewhat a little bit of deference because he is a former president. He still has his secret service protection. Its government funded bodyguards. And so he gets a sort of slip through the back door of the courthouse. But whats different about the state of georgia is that they have very open laws in terms of courtroom transparency. And so we will be able to see all of this televised for the first time. President trump making his appearance on national tv. Does it change anything for trump . Gregory as he campaigns to be the president of the United States . Well, as i said, this is the fourth indictment. And if were judging by the first three indictments, it really doesnt change anything. The first three indictments have done nothing to diminish his stature in the polls. If anything, hes grown an even bigger lead over the rest of the republican field. And each one of these indictments has been a fundraising opportunity for him, as well as small dollar donations, which are the lifeblood of any modern president ial campaign, have poured in in the aftermath of his first three indictments. And i suspect this one as well. In the longer term, in the middle medium term, its going to be a huge distraction for him and for the rest of the republican field where were filling out the calendar now for 2024. And in the midst of a very busy election season in the United States, we have a series of of primary elections for the Republican Party to choose its nominee. And those will start in january and go to the Republican Convention in august. And and President Trump already has a number of trials out there. And this one is going to have to take a number in line behind those. But conceivably, President Trump could spend most of the year in a courtroom defending himself in these these criminal charges in four Different Cases while he should be out campaigning for president , United States. Gregory thank you so much. Gregory there. Our white house and politics reporter. Just getting us up to speed. Of course, its were approaching almost midnight, if not already there, of course, in atlanta. This breaking news, these. Last 30 minutes or so, right. Just ahead, well take a closer look at how oil and Gas Companies are faring when it comes to this transition to a low carbon world. Bloomberg breaks down their latest report next. Out. This is bloomberg. This is bloomberg. Oh, oh, oh. Ill be the judge of that. Oh, thats nice. Oh searchable, verified reviews. Thats better than the ham, and ive never said that. Booking. Com booking. Yeah get high quality meat. Sourced from trusted partners with free shipping. Always be can always be prepared and enjoy the important things. Sign up for butcherbox today. Well, it is a holiday in india today. It is Independence Day and we just heard from Prime Minister narendra modi. Speaking just earlier, of course, india again celebrating its Independence Day live pictures out of new delhi and a vision of the Prime Minister for the burning of oil and gas accounts for over half of the Greenhouse Gas emissions, causing Climate Change every year. Bloomberg looks at how ready oil and Gas Companies are for the transition to a low carbon world. Bloomberg head of asia pacific, ali ezzati, joins us to discuss the results of this years investigations. Ali, the top performers, who are they . Any changes since last year or so out of the 41 oil and Gas Companies around the world, that weve analyzed, the result this year, similar to last year, again, european majors dominate the top ten list, so eight out of ten spots went to the europeans. Same number as last year. The number one pick is a little bit different. So this year, equinor is the first rank, whereas last year was shell, which is now ranked fourth. You can see that there are no north american players in the top ten, unlike the europeans, which are investing in both mature technologies such as renewables and ev charging and biofuels, as well as newer areas such as hydrogen and ccs. The north americans are primarily are focusing around the newer areas and not investing enough in mature technologies outside of the european. A new addition to this years ranking is ecopetrol, which is the first time weve seen a south american actually make it to the top ten. Well, speaking of, if you could just take us through, of course, some of the big names in the Asia Pacific Oil and gas and how they have been been performing. Sure. So in last years ranking, we actually had two companies from apac make the list. They were japans oeneus and thailands ptt. Oeneus is still in the top ten, although its rank dropped by one. Ptt actually dropped out of the top ten. One unique feature of asia pacific is that in most countries, with the exception of apac, so be the exception of japan, korea and australia. In the rest of the region, oil and Gas Companies are dominated by state owned companies. So the likes of thailands ptt, Malaysias Petronas or Indonesias Pertamina as well as in india, of course weve got ioc, ongc globally. When we look at national oil and Gas Companies, while they continue to do similar investments to previous years, theyre essentially getting outpaced by their private competitors. So the private majors, theyre actually accelerating their investments in transition. So the sheriff of their capex allocations to transition is actually higher for the majors. And as a result, weve seen the state owned Companies Ranking drop, ali, since is indias Independence Day, lets focus on on indian companies, indian oil, ongc, what can they do to improve their score . So the way we do this scoring, were looking at both the the risk exposure which is more about the Current Business model and then adaptation. And we put more around sort of the Business Model adaptation, we put more waiting on that one. A simple reference would be around looking at how theyre allocating their annual capex, more investments in both mature technologies, for example, investing in renewable assets or things like charging infrastructure as well as newer technologies such as hydrogen or depending on their existing Business Model, whether theyre an integrated player or whether theyre more focused on downstream, will be the way to go. This is, by the way, a topic were going to be looking at more when we host our delhi summit next week on august 24th, in conjunction with b20. So well be talking about this more next week. Yeah, hope, are we invited . Hope were invited. Ali, thank you so much. Great stuff. Of course, ali, you are, of course, from our bloomberg team. Yeah, there we go. Fantastic report coming down, by the way. There we go. To to what ali was just mentioning there. Of course, that summit taking place 24th of the month in delhi. Its the official, of course, beat 20 side events, bringing together leaders, Energy Transfer finance, government to help create and shape a cleaner future, but has before the 24th. Someone has until the 25th to do something. We have breaking news. Well, thats right. Trump and the defense giants have until august 25th to surrender in georgia. Of course, this on the back of trump being indicted by georgia prosecutors in the 2020 election probe. We they were indicted in atlanta over efforts to undo his 2020 election defeat in georgia. Again, trump and his defendants have until august 25th to surrender. In georgia, were still getting lines. Well keep you posted. Plenty more ahead. This is bloomberg. Hi, im mr. Wonderful. If you own a business and have employees, you need to check out the program at wonder trust. Com. Theres money waiting for you. I did. Which is why i have time to tend to my precious little trees. Hes such a good boy. How can you sleep on such a firm setting . Yeah, mine is almost the same. Almost is. Its another word for not as good as mine. Say 50 of the sleep Number Limited Edition. Smart bed, plus 36 month financing on select smart beds. Shop now only at sleep number. Hey, corporate types. Would you stop calling each other rock stars . Youre a rock star. You are a rock star. No more calling your coworkers rock stars. Look, its great that you use workday to transform your business, but it still doesnt make you a rock star. So unless you work with an actual rock star. Hi, im oswald. Hello, oswald. Pam, you are a rock star. I wasnt gonna say it. Together we have the opportunity to build a more sustained and inclusive future at the Bloomberg New economy forum, we help make this possibility a reality by cultivating new connections among Global Leaders that transcend geographies in industries and ideologies. Because when Global Leaders Work Together for the outcomes benefit all of us. Learn more atoomberg new economy. Com. Welcome back. Taiwanese president ial candidate chin is currently on an overseas trip, including two us stopovers that have angered beijing. But before that, Bloomberg Businessweek editor joel weber got exclusive access to lie at home and on the campaign trail to find out whats motivating his desire to lead taiwan. For taiwanese president ial hopeful li jingda, events like these have become the new norm of late. Meeting with dpp faithful between his duties as the partys chairman and serving as taiwans Vice President. Welcome to my hometown. Thank you very much for hosting us. Nice to meet you. Yeah. Let me introduce my house. Yeah. But its in his hometown of wanli, 25 miles north of taipei, where we first meet up. This is my fathers painting, and this is my mothers painting. I know that you had a very close relationship with her. Yeah. My mother worked very hard all her life. She has been my inspiration. I grew up in this modest family home where he opens up to me about his family political future, and the future he sees for taiwan. Do you feel that the international l community treats taiwan justly . I think so. I think so, because taiwan security is a global issue and the peace in the indopacific region benefit all the country. So this is a home you were raised in by by your mother who was widowed. She wanted you to become a doctor, a medical doctor, and then and later told you not to enter politics, which you did anyway. What advice would you have for you right now . Well, mama, in the past, its true. My mother did not approve of this job, but she loved me. And she said to me that if the people support what youre doing, then continue doing that. If they do not, then come back to being a doctor. So if she were still alive today, i believe that she would encourage me in this route. Im taking and she would encourage me to win the support of the people and to take care of many more people in the years ahead. I know this may seem obvious to you, but why do you want to be president of taiwan . Im. I want to lead this country so that our citizens can have better lives and want to lead this country, particularly in a time of growing geopolitical complexities, to be a stable force here in the indo pacific region. To become president , though he must court the all important youth vote, which is exactly what he does back in taipei. I wanna being here must remind you of your two sons and your grandson. How do you explain to them that this Younger Generation that someday they may have to stand up and fight to. I will tell my sons as my grandson is still very young. Everyone grows up in different circumstances. I myself had a difficult upbringing in the countryside. But regardless of how we grew up, we must all Work Together. We must Work Together to take care of those less fortunate. We grew up on this land. We should fight for this land as much as we are able to and ensure that taiwans people can have fulfilling lives here for generations. But the question all generations of taiwanese have heading into the election how will lie handle the delicate relationship with china . We dont want to be enemies. We can be friends and we love to see the china can enjoy democracy and freedom, just like us. As long as there is parity and dignity, our door is always open. We are willing to cooperate with china to advance peace and prosperity in taipei, taiwan. Joel weber. Bloomberg businessweek. All right. Were just headed into the lunch break about five minutes away here in hong kong. Well get you a roundup of the sort of big movers. What you want to talk to you guys about chips, though. And were seeing this move really against the grain on the back of. Well, you have news out of micronics here talking about and Management Guidance here to the upside on laying out expectations in terms of demand. Thats number one. Number two, we woke up this morning with quite a big pop in shares of nvidia. So this rally seems to be juxtaposed against the global chip rally were seeing overnight. Plus, Morgan Stanley, by the way, when the chips fall, they say its time to buy the sell off. And nvidia is a good entry point as far as Morgan Stanley is concerned. So this is really one of the i guess, has few bright spots today. Thats right. In the opposite direction, though. We have chinese stocks. If you take a look at the Hang Seng China Enterprises index. It is down about 7 10 of 1 . Of course, this is the third day of that index getting under a lot of pressure. It has to do with the china story. The property story, the lack of stimulus coming from the authorities in china to prop up the economy. Investors are waiting for that big stimulus. It aint coming. And hence, that is impacting sentiment in asia wide, though, there is relatively calm. The slight tilt upwards for the msci asiapac index. So we have a disparity there. This is it. Bloomberg markets asia. There is a lot that goes into becoming a licensed therapist. Two years of graduate school followed by two years of clinical training. You literally have to do 3000 hours plus of interactions with clients. It is quite a journey. For over 25 years. Lovesac has been rewriting the rules of comfort. Its okay to change your style. Its okay to change your mind. And to change things up, get messy, get immersed. With lovesac you make the rules, you automate sales tax with avalara. You dont have to worry about things like changing tax rates or filing returns. Avalara. I. I. I. I love my parents. 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