New zealand this morning expanding in early asian trading. It is down 1 . 20 is your level there. We are also counting down to the opening of japan and korea. Closed one25 last point nine percent down at the 15 391 level. Is going toe it drop precipitously below that 15 thousand mark. That is according to futures trading in chicago. That is continuing to see the most inter the endgame four months. Investors very sensitive at the moment. We are poised for a rocky session in asia to start off the week. Most indications are pointing to a selloff across the region. David dingus is here to tell us why these red arrows continue to dollar yen. This highlights the flight to safety. There is a flight to safety in currency and sovereign bonds. Onyou look at what happened wall street on friday, it does give an indication that theres going to be blood in the streets in asia today. It will not be a pleasant session. Have the fomc decision coming up. You have possible contraction in chinese manufacturing. We have the wall street 2 declines. The index forced the measures into future volatility. The gauge market fears spiking 31 . Ask is a level where we betweenbetween act the government shutdown. This is the highest level in several months. It trades in chicago as well. Futures of different trading of course. Sentiment as he moved toward this. I want to look at argentina and turkey. Risk aversion. S argentina compares at 17 . They did devalue the currency as well. A lot of people will mostly be confined in argentina. Capital markets am not really been open to the Financial Capital markets. The more systemic risks are comingfrom to be are from turkey. Whereast week, a decline were at 35 over 12 months. Turkey, andwith this is a reflection of what could happen elsewhere. Is a structural issue. Just the amount of debt that is in foreign currency. And makes it more exposed. More exposed to fluctuations. They do not have the war chest of foreign reserves. The hedge fund you are looking at that. It could be a good trade. The question is what is going to happen in asia specifically . We were talking about the japanese yen. It is going to be a Foreign Exchange. The stock markets will see declines. Perhaps a second level system. We will see first the flight out of emerging markets. Lets take a look at bond yields. I talked about flight to safety. The 10 year japanese bond we are at 60 three basis points. We had 10 year 370 two basis points. The yield spread is also narrowing. Markets, there is a separate measure for emerging markets. That is also trading. That spike the most in two years. 40 over thewas up past week. Vix index onally a the emerging market etfs. It is the sentiment on emerging markets. Suspects will be watching closely. Yet india. Yep indonesia. Is current deficit account countries. It is really more of an excuse. A rating across the board. Yet hungry. Brazil. Russia. Take your pick. Mix. N thailand in the all of this started after chinese the manufacturing numbers in the Market Economics showing contraction and definitely more than what people had expected. Anditivity to the market people looking at china for a trigger point. A couple of days in now. Thank you so much for that. No trading in sydney. Markets are closed for the australia day. Of the firsthe day british ships to arrive in the country. Violence has returned to the antigovernment protest. The man shot dead in bangkok. It happen as demonstrators tied to disrupt early voting for this saturdays election. Lets bring in house linda on men. Has this worked out on how this will go ahead . You are right. The commission is repeating the call for a delay. These reflect what will happen on february 2. Men one man was shot in bangkok as he called on protesters to disrupt early voting. They were reported at point across the city. The unrest forced the closure of most polling stations in bangkok. Were high as wouldbe voters saying that democratic rights were being infringed. Sayslection Commission Voting went ahead largely unimpeded. We heard from protest leaders. He said the Government Campaign will continue until promising of the election. Meet with the Election Commission tomorrow to talk about a possible delay. Said the polls will go ahead and go ahead. 90 of the country unaffected by the protests. A lot of people are ahead of the Chinese New Year and a lot of people not going to thailand because of the extent of his violence. Do we know how much these are starting to hurt the crucial Tourism Industry . And has been affected in a huge way. Especially since the protests are happening near the lunar holiday. Revenue loss could amount to 685 million. Russian visitors canceled their trips. And this monthon alone. It translates to 30 occupancy for some hotels in blood cells. But so what there was a prolonged protest. This relies on the industry, the only bright spot lawsuit. Sluggish investment. A slump in tourism which will worsen the Growth Potential. Thank you for that. The governor of the bank of england is said to have urged the worlds top bankers to show restraint over better conduct. He held private talks with of banks. They have seen the reputations heard by a string of allegations that they manipulated Interest Rates and exchange rates. Beclays is said to considering blowing the whistle on the sponsorship of topflight english football. They think the premier league deal has zero value in the u. K. The runs until the end of 2016. It may pull out of the glamour project. With results. T profit likely fell 40 pure this for the final nine months of last year. The report says Business Travel declined while the weakening yen drove up the price of fuel. An hour away than from releasing its trade data for december. The numbers, policymakers are left with the threat of the last decade. Deflation. John dawson is here with a preview. What can we expect . Row for 2013. It will be a record figure of ¥11. 4 trillion. The 6. 9. Well above, it the deficit of 2012. This would be the fourth largest month on record. The larger stretch of records. This gets the Power Generation going. Certainly getting the trade deficit. Is is a crucial one to look out for. Forecast for the month of december is ¥1. 26 trillion. To take a look at exports. They will skew the results a little bit. There other releases that we should be looking out for. You mentioned imports for december. 22. 6 . Exports 18 . You have december minutes. They left everything and change. Inflation was talked about. That was amazing. They expected all to come out. To think they had a shot out . I guarantee they did. We will see it in a minute. John dawson. Thanks for that puritan big guests coming up. Were going to take a look at the rising concerns over emerging markets with the asia chief executive. He will be here in about 30 minutes. Later on, house was luxury band is weathering the excess and china. That is on the move and just a couple of hours for now. On this show, the tumble ahead. Is it justified . We will speak with an economist after the break. Welcome back. It is monday morning. Thank you for joining us. Lets take a quick look ahead at 70 main events. After earnings disappointments for samsung and hyundai, this is the next korean heavyweight to report results. That is out today. They will be looking to revamp her loss that came from the stress of the one. Policy makers meet tuesday in india. That is the day we are watching for you on the 28th. That is tomorrow. The central bank has raised rates to raise inflation. No changes this time around. The year may have ended badly for nintendo but we will get the december Quarter Results on wednesday to see how badly it covers the annual loss nintendo warned about last week. Thursday perhaps things are looking up. We have china reporting that day coming becoming the first. It runs the largest that is writing the boom. Just the day before the new year officially kicks off. Maybe they will be heading off. Lets get more on what to watch out for for this week. He joins us live from singapore. We have a very full plate this all the rest. I. To in korea coming out with a number of earnings. I want to start with just what theave been seeing by chinese manufacturing data. This global route just continues. It flows through from asia to the u. S. Equity markets and then back again. What is going on . Chinas economy is now slowing. The sector is contracting. They showed the economy slowing. This is not necessarily the worst thing in the world. Chinas growth has been unsustainable. It has been too focused on credit. The government has switched into a model that is less reliant on credit and investment. In the long term that should be sustainable. This is exactly what china needs. If expectations that china will go 7. 5 to 80 . Know, and a lot of people had expecting chinese slowdown. Perhaps it is another reminder. This does come in the broader context of the underlying current. Also concerns about emerging remainability to healthy. Exactly. I think when tapering was first announced last month in the markets to get in their stride, that was maybe a surprise. Theyre all coming around to the idea that this is happening. Of being another 10 billion of this effort. This is going to carry on through the year. Every meeting that has this year. It will taper. Stop factoring that into prices. Unless it happens, therell naturally be periods of high risk aversion. It will be the economies that look the shakiest that are impacted the most. Last week it was the ukraine and turkey. In asia, india was hit harder. It looks like the new Central Bank Governor is a little more competent if you like than the last one. There some assurance there. I will be hit quite hard as well. About india a little bit closer. There really come in and boosted the confidence. What do you think in terms of what the r. B. I. Is going to do, keep rates steady . They thought we would see a 50 basis point cut. They will probably be keeping rates on hold this week. The inflation dates have shown that prices have come down, especially food prices. As you think the rba will be in any rush to slash rates. Might had triggered a rate cut. That is exactly the kind of with highng inflation. I think this governor will be more focused on this. Around 10 . There was a committee recently reported to the r. B. I. Saying they should be focusing more on Consumer Price inflation. Have a faireeds to amount for the target to be met over the next year. I think rates are on hold probably until the end of the year. Thisll be the last four been burning. That is before janet yellen takes the helm. Region,role in this which economies are healthy and prepared . Which economies are you a little more worried about . Any economies with large current account. Iny look like they should be fairly decent shape. Singapore looks quite good in that respect. Malaysia runs the current account surplus. Account deficits like indonesia. India has reduced its current account deficit recently. That may be hit less hard than it was in the last wrong dust round of turbulence. The one were most worried about his tile and. They have a political crisis going on. It has a current account deficit. Over the last decade it has been on a bit of a credit binge. Is looking quite shaky. Almost as if they are being distracted by the political instability that really curbs their ability to bolster up the infrastructure reform needed to make sure it is on sure footing when all this goes away. Is that what youre saying . This is maybe a distraction from the underlying problems. That is the household credit. They would be raising Interest Rates to cut up that credit. It is having to cut rates because the economy is going bad in other ways because of the politics. The politics is going to delay key infrastructure projects. Fiscal policy is really tight. Usednterest rates of being to run of credit in the economy. In time that will probably come back to bite them. A very comprehensive view as to why things in thailand do not look good as this political instability persists. Coming to usrkin, from singapore. Thousands of leaders and business tycoons are heading down from the mountain tops. Of the bigome takeaways . We will have the news from v him andos. Acv the financialn markets the surprising according to the Goldman Sachs ceo. Stocks had risen in value so much it would be a normal abnormal not to see some consolidation. Right now one of the macro themes in the market is that emerging markets are under some pressure. Why not . They are higher yields. They are riskier. People know what theyre getting into when they have them. The Growth Potential is so high they are attractive. They will go through starts. This is an example of each country has their own dynamic. Coo echo thechs sentiments and we have seen moves like this before. This is not extraordinary movements in the market. We have seen movements like this before. Member what we saw when been started on the tapering speech middle of last year . We saw one hundred basis points. We have seen the tenure move about 25 basis points. Tohave seen normal reaction things that go on on growth markets. They are not develop markets. Spoke with the former ecb president saying the economy is better but there are some worries. These are also there in the emerging world with the most Vulnerable Countries be more or less considered as potential problems. You can get more on that and all the days top stories on her website. It is your Online Search for business and market news 24 7. Twitter, it is easier to stay in touch with us here on first up in asia. You can follow us bloombergtvworld. All right. Up next, rolling the dice. Corporate japan ways into the debate about legal casinos. We will take a look at the arguments for and against when first up returns. Hong kong on a monday morning. Are we going to continue to see this route flow through on the hang saying . Were 30 minutes away from the japan andading in south korea. That is something we will be watching closely on your tv, mobile and online. You are watching first up. Bracing for a sellout. Asian stocks are expected to tumble today. Rolling the dice. Corporate japan that on the legalization of casinos. Why hong kong may benefit from the accounting standoff between china and the u. S. To it. Et straight i am angie lau. Checking the markets, new zealand down at 10th avenue 1 . 1 10 of 1 . Lets get over to japan and check out what futures are indicating below the 15,000 mark. That is what it tells us this morning as the yen extends the jump after the emergingmarket route continues on friday and flows through today. Right now the yen is that the 102 spot. The nikkei last close on friday close to 2 . As the sochi olympics gets underway in russia, japan is looking to 2021 tokyo plays host. One of the key decisions is whether to legalize casinos. That is a part of the conversation. Zeb joins us as it gains broader support. This is a big issue. If it happens the parliament is set to take this up. Now Business Leaders increasingly behind this idea. We have it by the ceo of loss awsone coming together to throw their weight of corporate japan behind this casino plan. Here is the back story. Theidea is that by the time olympics happen in 2020 japan will have a fullscale Casino Industry. This certainly requires a change in the law. It has to go through the japanese diet. Billions ofuire dollars in investment, which the like of mgm and Las Vegas Sands said they would be willing to commit. Heres an interesting statistic. Japan is estimated to be the world second largest Gaming Market if they allowed the casinos to push forward. Will they allow it . That is why the business lobby is getting behind this and forming an exploratory issue. They arty spend billions of dollars on pitching goes. Why do they thing the company will be so good for business . A rising tide reaches all books. If they allow these integrative resorts, casinos, hotels to be built along with Shopping Centers that it will improve the overall economy. It will help other businesses as well. That is why these companies are getting behind this. Our opponents to gaming in japan. They say it will run the unit fabric of the japanese society. It is not consistent with the japan we know today. A huge amount of money involved here. 10 billion projected in annual revenue. They want these casinos opened by 2020. Were hearing noises that james packer also interested in getting in on the action. Gambling wantino to get in if this does happen. All of this part of the broader story of abenomics trying to stoke japan out of the last decade that it has experience for so many years. More than a decade. This is part of the plan. Thank you so much for outlining all of that for us. Lets get a rundown of some other stories. Sony is betting that Sheryl Sandberg for its next big hit. That the screenplay will be fictional and based on themes covered by the book. Hasa second richest man announced plans to release 5 billion in the u. K. Wanda will go toward cultural and travel related project. Chinese pork supplier has said to be planning the biggest Hong Kong Ipo and more than three years. They may seek up to 6 billion u. S. Dollars as rising demand boost demand for meat. It became the worlds biggest pork supplier when it took over the Smithfield Foods last year. That was a round up of your top company news this hour. I am david inglis in hong kong. To a dispute over accounting has sent china tumbling in new york. Here in hong kong, exchange could stand to benefit. Mia saying he is here to explain benefit. Kong can we had the u. S. Regulator and judge saying that the chinese has earned this. They are banned from auditing those companies that are listed in the united states. This ties back to win the sec has been seeking documents from the Accounting Firms as you look to the regulators that had emerged over the 20122011 time period. They refuse. Saying that according to chinese roles is as part of state secrets. They cannot divulge this kind of information. We have tensions really erupting between washington and beijing. This is a government issue. It is not an accounting issue. They continued to refuse to provide this type of clarity. This is what we have. Will not be disruptive until 2013. We know that most likely the firms will have to hire new auditors if they lose the appeal. They are appealing collectively. In the u. S. , you must have an auditor. It during that time you do not have an auditor, you cannot trade on the markets and the shares may be suspended. This comes at a time when in the past two years it has been really hard for the Chinese Companies to make way in the u. S. Mainly because investors have been very skeptical of the firms. You have here is essentially a backlog of companies who are looking to list. Of 2013 youe part saw investors in the u. S. Become a lot more confidence. If you take a look at the increase of013, an 160 six percent of Companies Looking to live in the united states. 166 of Companies Live in the united states. If you look at the Bloomberg Top 55 companies that trade in china, on a oneyear chart we are off by 1. 7 . The announcement came out last week. You saw it fall by a little bit. Year, you can see that the momentum started to pick up again in may 2013 went investors started to feel a little confidence. If the chinese adrs arent plummeting, there is a bottleneck. There is concern about accounting. Why would hong kong be poised to benefit . For many reasons. Number one, proximity. If youre looking to tap into the asian mindset of the investors. This is one aspect of what is happening. That are aas rules lot more open than the chinese rules. Many think if you are going to have an asia angle, hong kong would be a great place. You may see an uptick in those companies that are looking to list in hong kong. Could alsothe ruling mean lower valuations. You have to keep that in mind we think about whether or not you can get the high value in the u. S. You may have to wait it out until the ban. It could stoke the interest of u. S. Investors. Thank you so much for that. Checking some other stories making headlines around the world. Thailand antigovernment protests in bringing another for totality with a man shot dead in a bangkok suburb. It happened as protesters tried to disrupt early voting for next weekend elections. At least 11 people were injured. Protest leader said the campaign will continue until the Prime Minister and her government standdown. The unrest for the closure of most polling stations in bangkok , but voting went on largely unimpeded for the rest of the country. It shows the protesters to have the ability to disrupt saturdays mean vote. Delayed. Be several people were hurt when police crash with protesters. Hundreds of demonstrators demanded the release of 23 people arrested earlier this month. Process of this at the start of the year. Here is a question. Why did the chicken cross the road . Lorey crash, perhaps. In dense fog. About a thousand of them escaped , forcing the closure of the row, getting Traffic Police a something of a headache pain. Headache. Neither chickens or drivers were hurt. The most active volcano has written for the first time this year providing some dramatic pictures. Close the performance nearby airport temporarily but did not threaten local villages. It was particularly restive in 2013 with a new crater forming. Up next, a growing industry. Why insurance is on the up in asia. We will have an exclusive interview with barry stowe whose chief executive of prudential asia after this short break. Welcome back. The u. S. Market setting up the week to start more losses after last weeks decline. S p futures looking like this. Here is the damage on friday that we are talking about with the s p 500 slipped the most since june, down more than numeral two percent. The decline spread to the middle east for the benchmark slumped to. 2 sunday. Insurance is a fastgrowing sector here in asia. Our next guest leaves a leading player in the region operating in 13 markets. Joining us exclusively this morning is barry stowe, chief executive of Prudential Corporation asia. Thank you so much for joining us this morning. Your joining us during a couple of days. A lot of people worried about emerging markets and the status as a look at their portfolio. On thee you seeing ground in emerging markets that gives you a different view . On the ground in markets where we have important strong positions like indonesia, philippines, malaysia, were not seeing any slow down. It is business as usual. He gives me a lot of encouragement that this is just a shortterm volatility, not anything systemic. What specifically are you seeing that gives you such optimism in indonesia, vietnam, as this emerging class really changes how they decide to live their life with insurance projects. Economyit changes the of those nations as well. Newberry fundamental way. What is happening is really his store. Yet the way back historic. . Way back in history to see where a group of people have risen from relative poverty into the middle class with such speed. It is an extra nerdy thing that is happening. Indonesia is one of the perfect examples of where you have a very rapidly rising middle class. These people for the first time often and memory have something to protect. Theyre very focused on financial planning, concepts which a generation would have been foreign to them. We build distribution that reaches those people. It teaches them some fundamental tenants of financial planning. That is a very important part of helping them assist in the rise of the middle class. What is also important as helping the financial literacy. We do a lot of programs around that work as well. When the most incredible things i saw when visiting cambodia was all of the storefronts popping up, selling insurance. Prudential among them. I had no idea you were there. A year later where are you at when it comes to the cambodia market . Even just talking to some folks i am, they are saying thinking about buying insurance. It actually protects my investment. Absolutely. Been on the ground for a year. We have literally been operational for a year. A marketleading business there. Huget to suggest it is a business. It takes a long time to build a large business. We are number one in the market. We continue to grow very quickly. We are happy with that. What is the impact really on the lives of individuals and on the economy . If you look at a place that is very much an emerging market like cambodia, the Life Insurance industry has always been one of the building blocks. You have a population largely unbanked. The population is largely unlinked. What the light Interest Rate has done in places like cambodia is take peoples savings and turn it into investment for the community. We take savings that sometimes comes out of a box on a shelf in bonds. Ent in government literally turning savings into investments. Governments based on approval, Regulatory Environment that allows you to be there. Take a look at china. If youre there but you only allow a 2 . Foreign companies only allowed a 2 for print. You overcome that . Doesnt that put a crimp on your growth . The restrictions are unique to china. This expense nationally. Our attitude is the government sets the rules. We play by the rules. In china weve had some regulatory restrictions. We execute. We do the best we can for consumers. Therell be a gradual liberalization. Everybody is looking at the liquidityion with markets, especially the fed turning off the cap. Rising Interest Rates will generally mean a better environment for them to operate in. We have done better and the last several years in environments where we had historic lows. It makes it difficult to manage the savings element of the project. Rising Interest Rates is not a bad thing for the industry. It is a good thing. What about stoking the people on the ground running to buy those insurance products. To the extent that rising Interest Rates allow us to develop different projects, it has the prospect of creating more interest. Incould actually help us terms of making the projects even more compelling for consumers. The chief executive. Thank you so much for joining us. We have some breaking news coming out of japan. We are getting the latest trade data. 1. 3 trillion yen. It was forecast is at 1. 2 six yen. Just a little bit wider than forecast. The deficit tops 2012 6. 9 trillion. A huge amount. Higher fuel costs. That is the fourth largest on record, the longest stretch on record of deficit. With that comes exports and imports. Exports rising 53 . Imports also below a forecast of 26. 2 . The yen wanted about nothing yet. This from the bank of japan as well. The economy has been recovering moderately. No comment about inflation or deflation. This is back in december. Also japan has a breakdown on exports to the eu. It rose 22 over the year. That is quite encouraging. Exports and imports moderately below estimates. It is the longest stretch on record. Checking the singapore traded futures. It will start as they signal down below 15,000 more. The luxury yacht world has china in its site. A growing number of wealthy buyers. It is proving something of a hard sell. It is party time in the Mayfair Hotel in london. Heads of the world most luxurious yacht builders are here for a once a year get together. Whichis one question bridges the rivalry between these yacht builders. China. Why the country was the second highest number of dutch with the secondhighest number of billionaires is not buying their boats. Theres not a single yacht delivered into china. Theres a staggering 180 meters long. It is designed has more in common with a navy than a normal yacht. Similar yachts of a size have sold for more than 300 million. Selling the mediterranean dream to china has proved difficult. Fed shipyard is eager to break down the doors to china. The potential is there. There is money. They are very creative. It does planning. Currently china has a like number arenas and other infrastructure. That is not all that is holding the industry back. The bureaucracy to sell into china is high. Prohibitive 45 tax. Clearly is protectionist. Back at the Cocktail Party comment you can spot a lack of chinese buyers. It could require a generational shift before chinese billionaires are convinced to buy. The russias already begun to secure the first deals and break new ground. Bloomberg. You can get a taste of the good life yourself. All you have to do is head to our website. Bloomberg. Com luxury. In the next hour, an update on the simmering unrest in thailand as protesters try to disrupt early voting. We are counting down to trading in tokyo and seoul about to get underway. We are expecting a tumble. Investors seeking safety. The yen is rising and gold is at its highest since november. The deficit deepens in japan. Im going to take a look at the latest trade figures. The monday morning to you. Im coming to you live from our asian headquarters here in hong kong and streaming on mobile and bloomberg. Com. Welcome to first up. Markets are closed. It does mark the anniversary of the first ship to rise in the country. This is basically trading at 86. 9 u. S. Cents right now. It continues to strengthen. Japan is just opening. The nikkei 225 last to close. It is down. Another 2 , extending the route we saw on friday with a 2 close. It is a 2 down, right at the start of the session. The dollar yen continues to strengthen, briefly touching on that 101 spot. Is 14 to the u. S. Dollar. In korea, the kospi is getting underway as well. We are expecting a broader route in the Global Markets to extend here in asia once again. 1. 8 down. That is what were seeing in seoul, south korea. The korean one is weakening. 1080 five. Breaking Economic News coming out of japan and just the past few minutes. Deficits. Rade john dawson joining us live with the details. Arend us again what they and what the impact is going to be. Deficit again 1. 26 trillion was the forecast for the month of december. It is slightly wider than forecast. Enemies of the fourth biggest on record. 2013 has come in 11. 47 trillion dollars. 2012, it is almost double. It is the biggest deficit ever recorded in japan. The shortfall is the longest stretch on record. All of this high fuel costs for generation is what is behind that. Exports were meant to rise. They actually came in 50. 3 . Set to rise. Shows thet just concern about inflation as opposed to deflation. Figure mayecord shake a few leaves in the bank of japan. Absolutely. The minutes of justreleased some interesting movements there as well, what they are indicating. They got a meeting from the december 1920 meeting. Inflation expectations were rising. That was common back then. Inflation pace will lessen gradually. The bank of japan needs to speak clearly on the oncoming sales tax outlook which kicks in in april. I also talked about the economy recovering moderately. Those are the three made headlines. The image is holding this. The markets are falling because of the u. S. People looking to the yen for a safe haven. They are noting the sales tax increases putting pressure on the economy. Economists expect a 4. 3 hit to gdp. That is right. It impacts consumer spending. What will actually happen. Theyre reining in the spending. We will come see what happens. Have been beating forecast levels and trying to buy things before the tax kicks in. The guidance from the oj, a little bit more modest. The fence. N thank you. Declined underway in japan. Pressure, david is here with more. We knew this was going to happen. What futures were indicating as this route continues. It is a messy start to the weekend. A was not really much of surprise given that we were expecting the selloff on wall street to carry over. On friday new york were heavy as well. They were 40 higher than the 40 day average. You have the fixed index which is the market fear gauge. That was essentially the level. We were in between the government shutdown. I down 2 right now. 1900. Not pretty. It is not pretty in seoul today. What do we have . Is an indication of sentiment outside as well. That is continuing to fall. Futures are down a further four point. A every respect, it is not flight to develop markets. Is a flight to safety at this moment. You are looking at the typical safe haven trades. A flight into the japanese yen. A fight light into the swiss currency. That is up for a Third Straight day. Unless of course you have gold up for three straight days. Look at that. We have come up a bit. Or two at somene point. Hopped up with just a touch. Up, thatt the jjbs is where we are seeing a little bit of pressure. The spread in between the e areuries ar actually lowering. It is the Foreign Exchange markets that are releasing the gyrations of investors looking to save pay them. Sole index, you are not necessarily seeing the, this is a confident market leverage to developing markets. Leveraging to u. S. Demand. Were seeing that drop today. We are seeing flights to safety. It is also very dependent. The wildcardis last week. We could see a contraction there. It could push things off the cliff. Here we go. I was indicating this earlier. As far as Foreign Exchange is concerned, put it this way. We are only about a month into 2014. Over a third of the 31 and emergingmarket currencies have actually dropped levels of, you know, the middle of this year. It is the pace of the decline that has a lot of traders by surprise. Things willse revise these forecast. I will give you a good example. The South African rand and the turkish lira, the job last week was more than 2. 5 times the normal trading. That almost never happens. It happens about 3 of the time. Up here we go. 4 decline last week. We all know what happened to the argentine peso. They devalued the currency. F under current issues. The announcement is not a rescue. Certainly not. Problem is a lot of their debts are denominated in foreign currency. That will exacerbate their problems. It youre looking at credit default problems as well. Emergingmarket currencies are buying up more options. A protection against morelos. The index for emerging market etfs has traded in chicago. It is at the most in two years. Risk aversion as the name of the game today. Thank you for that. Results. Ck some operating profits as a carrier likely fell 40 in the final nine months of last year. The report says Business Travel declined while the weakening yen drove up the fuel cost. You can see this down 2. 2 . Sony meanwhile looks like they are betting on Sheryl Sandberg for the next big hit. The has actually bought film rights to the facebook chief operating operators first bestselling book. Will figure it out. Samberg will not be a character in the movie. The screenplay will be fictional based on seeing covered by the book. Some products were found to be contaminated with pesticides. Maroon hot niche euro currently 1. 6 . G slightly above nearly 3000 people reporting feeling unwell. The company has lowered its fullyear net income forecast from 69 million to 44 million. They connected to the contamination. Up next our next guest is predicting a jumpy week for the equity markets. We certainly have felt that today. Were going to be talking to Andrew Ferris after this very short break. A huge selloff. Risk aversion. Everybody is going for safety. We are seeing a flight to safety right now as this global route continues and the equity markets. Lets get more on that right now. Joining me is the chief asia. Ment advisor for how many phone calls to you expect to get today from worried investors . I jumped the gun. I sent a message to all my clients. It said to please ignore. I think this is quite absurd what is happening. It is not that i know better. The markets do not know better. They simply are. I find little justification of a global selloff. When i begin to look at the numbers, hello, it is neither global or a selloff. In asia, indonesia, thailand and the philippines year to date up. They really do not sell off. I read the headlines. Im looking at something different. Investors do not always necessarily look at the year to date context. They look at the gyrations. That is the momentum play. That is the psychology. That is what is the concern trigger by chinese manufacturing dad said that everybody knew was going to show a slowdown. China is slowing down. Hello. Been since 2008. Lets take a step back then. What does it say more broadly about how investors are feeling . It says the notion of tapering and the direction of the economy. We all believe that this has been beginning and can we get on with our lives . It has not. The second point is an uncertainty, the u. S. Dollar is strengthening. The yen and the euro are strengthening. But does not make a great deal of sense. The japanese are saying were going to continue pumping in liquidity in the markets. Therefore the yen should be dissociated. The third point is selectively there have been some concerns about emerging markets. Frankly, not the right ones. People should be concerned about tile and, frankly, not south korea or indonesia for that matter. Why do you think investors are playing from the page on the old playbook . Inay book we sell played out two thousand 13 . Part of the triggering was china. China produces a very interesting contradiction. It has the highest birthrate in the world. It has a superbly well managed market. We have to be very straight. We have to slow down without it crashing. Well. W this is not play we want china to accelerate. We do not. Down. T china to slow it just did. We want china to reform. They just had the mother of all reforms. It just does not gel. The stock market is there consistently. There are very good reasons for that. There are positive things. Things are very cheap and they are getting cheaper right now. On everything that you know and dismissing the really superficial concerns that you do not think our back . Favor developing markets. We like the united states. We like the pricing. We like the economy. We like the way were going. In relative terms. Chinas going to be a longterm proposition. This is incredibly difficult to sell. They are going to pay for that. The question is the National Peoples congress is going to redo what we know. Theyre going to be sectors and companies that will benefit and there will be sectors and companies that will not benefit. We are concentrating on that. Then there are the little ones that have been doing brilliantly. Philippines, thailand, south korea. Ill come back to this in a moment. They have done badly so far. The macros are Strong Enough and good enough for taiwan for us to continue to play with them. They are a very small portion of the whole capitalization. It is a little cherry. It is like you are just shaking us and saying wake up. You do not have to do the selloff. Onis not necessarily based anything valid. I know better. I do not come here and tell you everybody is wrong and i am right. Im getting puzzled. Please. It is not the end of the world. People say china has been slowing down. No it hasnt. In year 12 it was 7. 7 . Is great. You do not want to be caught, that is the thing. Toostrategy is not to get panicky, to maintain certain positions and stick on with this. But the whole thing sailed through. All right. Hanging on by the fingernails. Thank you so much for that. Optimismis growing that the Global Recovery is strengthening despite what were seeing in the markets. The former president of the ecb expects growth to outpace that of 2000 13. Jeanclaude trish a warns there are potential problems out there. He is probably right. We there was more gold than last year. The move is good. You can understand that from the short term. There are discounts everywhere obviously. Central banks are still doing extraordinary things, including the rates. That signals that things are not yet working normally in the advanced economy. There. Re also because of the change of the final cycle on its way to these are clearly reduced by the rowboat international communities. Exclusives the conversation. Coming up next, a lot more. Were going to get this latest on this longrunning story when first up returns. Stay with us. Violence has returned to thailand with a man shot dead in bangkok. It happened as the demonstrators tried to disrupt early voting for saturdays election. Lets bring in our southeast correspondent. This does he do a lot more doubt on whether the votes will go ahead. That is right. Protests escalating. The Election Commission be peaking its called. Want to delay elections. Clashes we saw over the weekend will happen on election day set for february 2. One man was shot dead in bangkok. Protesters to on disrupt early voting. At least 11 people were injured. There were clashes reported a point across the city as well. The unrest posting forcing most polling stations to close. Tensions were high. Wouldbe voters said the rights were being infringed. Sayslection commission they went ahead largely unimpeded in the rest of the country. They say the Government Campaign will continue. Shes with Election Commission tomorrow to talk about a possible delay. Here is what the deputy has said. 90 of the country is unaffected. Part was bangkok where the protesters are centered. Are starting to hurt thailands crucial Tourism Industry. We know that. Do you know the extent of the cost now . Tourers and has been affected in a huge way. You want to take a look at the numbers. Take a look at that. Be 685likely to million. Russians also canceling trips. Some hotels will only see 30 occupancy. Were talking about the likes of bangkok. Here is an antidote i heard. Meant to play in the stage two of the davis cup this coming weekend. They pulled the plug. They said it is way too risky. It cannot get insurance. By pulling the team out, hong kong faces a demotion. The International Federation had cleared the match. Those are tickets and flights booked. Pretty much gutted. But safety first. That was the decision made. Several people were hurt when riot police crash with protesters. They gathered to demand the release of 23 people arrested earlier this month. There were mass rallies after a series of protests at the start of the year. It was a very popular question, why did the chicken cross the it isthe hat reyause perhaps the loo crash. A gay Traffic Police something of a headache. Neither chickens nor the drivers were hurt. Up next, corporate japan rays into debate about legal casinos. Good morning. A live look outside as we gaze our sights on victoria harbour. Also this global route continues. The kong listed minors are shortest stocks on the hang seng. We are in our from the open of trade. That is what were watching here in hong kong. You are watching first up. Big falls at the start of a new trading week. The nikkei to do five is down nearly 3 . Japan is looking to the future, betting on the legalization of casinos. It looks bright. And world report says recovery is a turning point. We will talk to the lead author. Good morning. I am 18 g lau im angie lau. ,he nikkei 225 is down 2. 4 just fractionally above the 15,000 mark. Is down 1. 8 . 1905 is the level there. Markets in asia taking their cue from the wall street selloff on friday which took a cue from the asian selloff the previous day. What is happening today is that the agent benchmark is not the lowest level in over four months. Here. Inngles is the nikkei is close to 3 . The volumes are about 40 higher compared the 10 day average. You do have the selling pressure there. You have the japanese yen in the mix. It is usually a cue to get out of the market. At the usualng suspect. Yet the heavy equipment maker here. 225, only 2 are gaining. Lets look at south korea and what is happening. 30 minutes into trades, you also have the usual purity have sent siding and hyundai. This is up 100 . Have 636 in south korea as well. Look at the jgb. Money is continuing to flow. That his safety. He of the fiveyear and not 20 basis points. Yet the tenure at 62. Yet the 20 year at 145. You see more movement in the shorter end of the yield curve. Have treasuries of 271. He had to look at the fiveyear. You have to look at the five year. Of a self bit fulfilling prophecy right now as people concerned about the safety causing another wave of concern. This is where we are right now at this moment. Thank you for wrapping the latest action on this selloff. As the sochi olympics get underway in russia, japan is looking to 2000 2001 tokyo plays host. One of the key decisions before them is whether to legalize casinos. Wider and broader support. From the corporate community. They are supporting a rival industry if you will. We have an increasing number of Corporate Leaders in japan coming together to speak in support of legalizing gaming. Paving the way for casinos to the yearapan by 2020, the olympics comes to tokyo. We have the chief executive of suntori. And of thee among a few leaders are joining together to support a bill in the area that would legalize gaming. The organizing a task force to galvanize support. Theyre making the case it will lead to 10 billion in annual revenue for the japanese government. It would overall modernize the economy, strengthening the economy perhaps deepening its base. A really symbiotic support. As the economy gets to a healthier stage, more people are going to look at the dollars that are growing and their wallets and want to maybe some whiskey or buy some food. It is this trickledown effect. Willdo they suppose it help boost things . A rising tide lifts all boats are to transfer the olympics, tip you will need to buy a lot of additional infrastructure tokyo will need to build a lot of additional infrastructure. Specifically for the games. The thinking is that if they can get this Casino Industry off the ground by that time that they create huge new leisure and entertainment options. Convention centers. Itll help outay everybody. Right now betting on horses, boats, and bicycle races is allowed in japan. Did you know that . Casinos are bad. We should note there are those who say theres no place for casinos in japan. A lot of opposition. Though say itll make a dent in the traditional culture that japan has. These casinos have no place in tokyo. Social tradition or economic tradition of deflation for the last 15 years . Heres what the analysts are saying. Theres a japan could be the secondbiggest Gaming Market in the world. That is interesting. That is big. That is huge. Thank you for that. Checking some other stories. 5 billion in the u. K. Theyre looking to develop [indiscernible] the biggest slice will go to will cultural and troubled focused projects. Markets may and sponsorship of the top flight football. They claim bank figures has zero value in the u. K. Present agreement runs to the end of the two thousand 16 season. Arclays is reviewing all they are said to be planning the biggest ipo in more than three years. Sources say the company may come to 6 billion as they boost this. They change things from the international this month. Those are the top company news this monday morning. I am john dawson. Of, it is one of Many Companies buying hong kong for their public debut. Several more may lived here because of the dispute over chinese accounting. Ia is here with more. What we have is the sec saying that the chinese units of the four accounting forms are facing a ban when it comes to auditing the statements. Price Waterhouse Cooper has these. Overig four refuse to hand documents to the sec when the sec asked to do and indepth robe. Classifies it at state secret and says it is up to beijing and washington to handle this issue. The sec has imposed a sixmonth ban were the four firms are actively looking to appeal. It is not going to be disruptive to the 2013 books. 2014 could be a different story. It can mean new auditors. The trade in the u. S. You must have an auditor. Your Financial Statement has to be audited. It has to be looked at and scrutinize. Companies may need to secure a new auditor if they want to list. If youre not able to do that, the shares of the stocks could face a suspension. These are the stocks that trade in the u. S. If you take a look at the top 55 Chinese Companies that are listed in the u. S. , the index is off by about 1. 7 . When the news came that you saw a little bit in terms of price. It really could slow down the momentum you have been seeing since mid july when he had seen this uptick in the way they have performed in the u. S. Mainly u. S. Investors have felt a lot more confident about the Balance Sheets behind the companies, the regulatory stance of the sec investigating these companies. That could reverse. You could see where a lot of very companies faced challenging environment trying to get u. S. Investors to take a bite out of their stock. He saw a pickup in the chinese economy. Investors feel pretty good. How does hong kong play into this. Does this make hong kong were hardenedve against a environment by the sec and the u. S. . Is a sixmonth ban. Things could change after that. It could change after 21 days. You see the Companies Put forward their appeal paperwork. Hong kong of course could benefit. There are couple of reasons why, proximity to china, access for most investors to tap into the market. That is another picket. It happened to the hong kong markets that way. Alibaba of course is not decided yet where theyre going to live. There is speculation that they may shun the united states. That said, this is a boutique investment bank. He said the ruling could mean lower valuation. Even if you do see Companies Come to were the row it could be a very different valuation than what you would have seen if they had gone the u. S. Route. Theres just access to that huge market. Thank you for that. I blowing goebel will discuss the year to come in the company of the world bank. Our next guest says the World Economy is at a turning point. Stay with first up lustily quick check of the market simply around the region. Off today. Re selling only two on the nikkei apparently seeing a gains. 2. 5 down. En is also under pressure. This is down. Trading in just a little over 15 minutes from now. Openes pointing to a lower as this global selloff extends into monday. Bank has approved a 2 billion loan to me i am more myanmar. The money will be principally used for health care and energy projects. Proving Power Supplies is particularly vital to the development. That is really an investment in emerging markets. Joining us now is the lead author of a World Bank Report that examines trends in the Global Economy and how they affect developing countries. Were joined live from tokyo. It is so good to see you. Whene joining us on a day the optimism persists on the equity markets. We are continuing to see the selloff extends here and asia this monday morning. Youre saying that things are looking up in emerging markets. That is right. Looking at the Global Economy. How it is going to evolve over the next couple of years. One thing that is really important is that we are starting to have relatively strong growth in the high income countries. That will be a boost for developing economies going forward. They will not have to go it alone. Experts are going to be stronger. Expecting an acceleration in growth going forward. That acceleration is not without risk. We are going to have a tightening of policy in the u. S. That might throw in some far ass into the work as Financial Markets are concerned. That is part of the pessimism that were seeing today. Against the backdrop of the tapering, we also saw was the tiny slowdown that was broader and more deep than expected with a contraction in manufacturing likely by the end of the month when the official numbers come out. When you do look at china, that is a broad play. This is the worlds second largest economy. If it is slowing down more than expected, does that change your viewpoint . What were seeing is a slowing in the chinese economy. When we looked at manufacturing data, they are subject to a lot of uncertainty. That will be particularly the case at this time of year. The Lunar New Year that really messes up the statistics. We do not have a way of seasonally adjusting. It will be difficult to get a strong sense of what is going on in the economy over the next couple of months. The slowdown that we are observing is not particularly strong in our view. It is on a precursor of a significant slowing of the economy. Theer was very slow at beginning of the year. It ended up the year quite strong. We may be seeing something of a similar kind repeating this year. Helpsknow that stability the countries with current account deficits try to make way and prepare for this tapering. Not. Bility does it forces the hand of a lot of these nations. Which nations to you see as the most vulnerable right now . One of the things we do is look at what are the potential consequences of the tapering of the united states. General storyline is as long as that process is smooth, the consequences for developing countries will be manageable. We will see a decline in capital flows. Something that falls within a normal parameter. The trick is if the tightening isa lot more quick, if there a rapid increase in yields in the united states, that could have Significant Impact for developing flows, cutting them by as much as 50 for a couple of months. In that kind of context, there is going to be a hit. It will be felt by the economies with high current account deficits. Those that have accumulated a lot of new credit. We have a number of economies credit expansion has been in excess of 20 of gdp over the last five years. Not that there will be a crisis in them but this kind of expansion of financial conditions, these kinds of needs make them more vulnerable and therefore a potential cause for concern. Are developing countries ready for tapering . I think by and large they are. If we look at what has occurred over the last for several weeks, it has been relatively smooth. What we has observed to some stress in a few economies were some of these imbalances in terms of political issues or in imbalances,estic that is where the pressure is being concentrated. Were going through a protest of increased volatility right now today and on friday. I am not sure that its really a precursor of a more significant downturn. More of aat is just Market Correction than anything else. Great perspective from injury. Joining us live from tokyo. Thank you so much for that. Up next, luxury yacht makers target sales in china but charting the right course is proving a little tricky. A special record when first up returns. Welcome back. Thank you for joining us. Lets take a quick look ahead at some of the main advance we will be following for you after earnings disappointments for samsung and hyundai. Gt is the next korean heavyweights report results. They will be looking to basically rebound from a loss that came on the strengthening won. Policy makers meet tuesday in india. The central bank has raised rates to control inflation. They expect no change of this time around. Badlyar may have ended for nintendo. We will get the december Quarter Results on wednesday. It covers the annual loss nintendo warned about on lower console. The wii u samsung results the day before the Chinese New Year. Sams is writing the boom that has brought millions of chinese gamblers to macau. Well probably see this over the long weekend. The luxury yet world has china and its site, aiming to tap into a growing number of wealthy buyers. It is proving something of a hard sell. It is party time at the Mayfair Hotel in london. They are here for a once a year to get together. There is one question which bridges the rivalry between these yacht builders anna china and why the country with the second highest number of billionaires is in buying their boats. It is not a single yacht. Maker of the worlds biggest megayacht. More in common. Previous yachts have sold for more than 300 million dollars. Selling the mediterranean dream to china has proved difficult. This and holland. Like other builders he is eager to break down the doors to china. The potential is there. There is money. Are very creative. They have the funds. China has a lack of marinas and other yachting infrastructure. That is not all that is holding the industry back. They have an almost prohibitive 45 maximum. The back of the Cocktail Party and you can spot a lack of yacht buyers. They greeted could require a generational shift before chinese billionaires are convinced to buy. The russians already begun to secure the first deals and break new ground. Bloomberg. Always get a chase of the good life on our website. Check it out bloomberg. Com luxury. Next hour we will find out how they are weathering the excess. This is coming up next. A reminder of the major sports news of the weekend. Is celebrating after beating rossi l the doll. Nadal. It makes no difference. Wrinka is now number three in the world. The top story were following for you, markets trading in the asiapacific training this global route. It started with numbers contracting. The naked 225 is down 2. 6 . Is extending losses below that 2000 mark. 1. 5 down. The only two Companies Trading a civilreen is Engineering Company that does earthquake resistant Technology Race to outperform. That is seeing the game. The other Companies Seen gain is this despite 3000 people falling ill after eating its food. This president has stepped down. A lot more coming down. That is it. Good morning. I am rishaad salamat. This is on the move. Stocks in singapore, taipei set for a low open following big declines in tokyo and seoul. Investors seeking safety. The yen is rising. Gold at the highest price since november. We have the deficit deepening in japan. Have a look at the latest trade figures. It is a day with frenetic market activity. Gl s