Leadership. What you think of our top stories. Follow me on twitter at rishaadtv, and use trendingbusiness as well. Haidi waiting for governor corona. Kuroda. Rnor c the boj do inf the next couple of hours. It looks like we have given some back, the nikkei 225 down. A big, ugly print for august trade numbers. Could the boj take that into decision as they make that decision today . Giving back gains, kiwi stocks as well. Trading flat at the moment. Weakness from singapore, malaysia, and taiwan open. Sydney stocks rebounding, a nice gain and leading the region higher. In the last few minutes, we are seeing a little move to stronger 101. 76, but still pretty much range bound. Volatilityied spiking in the overnight session as we tend to do a head of boj decisions. We have had that reaction ahead of the last three meetings. Absolutely. Investors anxiously await that policy decision. Some disappointing august trade data. Data,start off with this imports and exports show this losing streak. What on earth is going on here, david . Exceedingwe call it, expectations to the downside, a horrible set of data for august. Exports down for an 11th straight month. It does not tell you that part of the economy is firing on all cylinders. Imports down 17 . 11 drop in exports, 17 drop in imports. Japan imports a lot of its energy needs. Up. And oil imports were ,e had these comments out basically saying a lot of these big japanese exporters are concerned over the japanese yen and the weakness we saw up and tell early this year is not sustainable, so they are not exactly scaling up capacity in japan. Exports a lot of capital goods. It imports Raw Materials and the next for the stuff out. When you look at the import without lng and oil, that is a bit worrying. Well, i guess it is what is going on behind you at the doj. As to whatany hints they will be coming out with . David thats right. To in recent talk weeks seem to suggest they are looking more at taking rates down further into negative. The governor and Deputy Governor week,ome out, both last acknowledged inc. There is a side effect to taking rates down further below zero. They are alluding to the fact that the banks are getting hit. Which is why when you look at the markets, youre seeing the yield curve stephen. Steepen. There are so many permutations to this one. That doesnt even include that anything they do, the fed can undo in 12 hours. Thank you a lot for that. Right, lets move along and have a look at what we have gotten in terms of this boj decision of further intoove negative rates may make japanese lenders the latest big short. We are looking at that story later on in the show. Toinas have agreed merge their listed divisions, creating an operation that could rival others. Tom mackenzie has been looking at all this. Run us through the details here. Tom we are talking about chinas number two and number six deal makers steelmakers. Swap ofe done a share their listed units. As the first up in a merger that would create chinas largest dealmaker steelmaker. Market value of the two Chinese Companies would be around 16. 3 billion as of the end of june billion, so 17. 2 not far off. The president er said he wanted to reform the state owned enterprises, particularly the steel sector, which is suffering from overcapacity. The government has pushed to create what they call state champions. That all be noted parties involved are saying that talks are ongoing, discussions continue, particularly our round the regulators, but this could be the First Step Towards a significant restructuring in the steel sector here in china. Are we likely to see more of this sort of thing when it comes to the Steel Industry there . China wants to create a giant steel operator and producer in the north and the south of the country. Question, theour answer is yes, but it would take some time. On tuesday reports and Chinese Media that two other big steelmakers, the fourthlargest could be tying up with another steelmaker. The largest chinese steelmaker is listed in hong kong. We saw its shares rise on that news. No the parties say they have more information to give us at this stage, but that was be another step towards restructuring that the Central Government wants to see. Improved steel have this year, but producers say it will be tough times ahead. Last year, china produced 800 million tons of steel. Resultedlt, that has in pressure from washington and brussels on beijing to rein in what they say is the dumping of steel impacting negatively the markets they are. Beijing says it has already 150ed pledge to cut million tons of excess steel capacity by 2020. Rishaad thank you indeed very much for that. Right, a look at some other stories we are watching. A are kicking things off with white knight for a troubled japanese company. Rosalind possibly. Takata has received five by out heads. Uyout bids. Out takata aims to shortlist 23 candidates. Of wells fargo came in for a grilling on capitol hill. He testified before the Senate Banking committee after a review found 2 million accounts had been open without customer authorization. Senator warren told him he should quit and called for a criminal investigation and more accountability from the banks leaders. You havent resigned. You have not returned a single nickel of your personal earnings. You have not fired a single senior executive. Accountableion of is to push the blame to lowerlevel employees who dont have money for a fancy pr firm to defend themselves. It is gutless leadership. Rosalind he told lawmakers he was deeply sorry and detailed a fiveyear timeline. Wells fargo says its internal review has expanded and is contacting all customers to ensure accounts and credit cards are products they need and want. A million note seven replacement devices have been shipped in the u. S. The company is rolling out an update for new phones, which has a green icon to indicate that users have a version with an unaffected data re. Samsung has an unaffected battery. To company moved swiftly recall and replace handsets that overheat and catch fire, mainly in korea and the u. S. Shares are rising. Rishaad right. Still to come, find out how alley bomblets alibabas finance arm is growing so rapidly. Just ahead, counting down to the boj latest decision. I will ask our next guess if he thinks there is a surprise in store. This is bloomberg. Rishaad right. I look at the trading day. The much boj decision, then nikkei and yen, awful trade data. I moved to the downside there. A quick look at the latest business headlines. Arm,bas financial probably worth 75 billion. That is the parent company. It is about 5 billion more than goldman sachs. It is expected to become a 100 billion business in two years. They are funding and ipo in hong kong next year. Additional 40an billion of stock on top of an existing 40 billion repurchase program that it is planning to finish by the end of the year. Microsoft has already raised its quarterly dividend. Having a look at the stock, jumping almost 30 in the past year. Option traders are betting on a hkex. On shares of contracts to pay out its a shares near its highest level since june of last year. The stock reaching a record in may, but went on to lose 50 when markets crashed and trading dwindled. Lets get it to tokyo. David is our man on the ground there. I believe you have mr. Ed rogers with you, david . As a matter of fact, i do. Lets talk with him right now. We are right outside the boj. Are expecting their latest policy decision a few hours from now. There is a lot of uncertainty over what can happen. Two questions, what should they do and what do you think they will do . The second question is probably the more interesting. Ist we think will happen relatively little in the shortterm. Has done a job of creating the environment , and they havege taken a lot of actions as far as qe2 create the right environment. What can they change today . Incremental at best. What needs to happen Going Forward is the far more interesting question. We think the policy discussion is about the structural change at a societal level. The boj has change the structure fxwhat effects dollaryen. This is incredibly impactful. That, maintaining the structure of dollaryen Exchange Rates. Going forward, we need to have a dialogue about structural change aneating and him environment that leads to that 2 inflation. He boj cannot do it on its own they are also coming out with the results of this policy review. I think that will be more interesting. What you looking for . The boj needs to walk a fine line between shouting to politicians or strongly stating can,ve done what we politicians you should do your thing, before quietly murmuring thinking we can make more incremental changes on negative Interest Rates or things like that. At some level, that is the dialogue. This assessment will be one of the tools needed to have further dialogue about structural change. Everything goes back to that. The boj in and of itself have fired most of its bazookas and willingness to take radical steps. Those radical steps taken two years ago now need to be by matched by more radical steps in the political environment. David are we talking fiscal stimulus . , there isstimulus cash and a willingness. I think there is an interesting dialogue to be had about has that money been wisely used in the past. Certain sectors of the economy such as the Asset Management industry, Financial Services, you could have much more impact in the supplementary budgets if you were directly supporting new businesses, creating new jobs in this space. The japanese government certainly has the money to do that, but they have not reached political agreement to do what the singaporean or Hong Kong Government does, which is to attract new types of businesses to this country and create new jobs in Certain Industries that will grow, and then you have a multiplier of fact, people paying more taxes, people Getting Better jobs. When you look at a country like japan, i find it hard to see what the pillar of the economy is. When you look at the u. S. , it is consumption. What is that pillar in japan . Are historical pillars, and then what do you think we need to have Going Forward. Historically speaking, cars, consumer goods. The Overall Economic sense, maybe 3 of the economy. These were things that permeated japan, japanese society, japanese economy. Those old pillars of growth are still there. Ability of at the the japanese to create cars, consumer goods. David the success of what you can do here yes and no. At the high end, the japanese still produce some of the highest quality manufactured goods in the world, and for things like the smartphone, that is very important, and the Exchange Rate irrelevant. Think about samsung, phones exploding, catching fire. The phone part of samsungs business. You cant the associated with that sort of problem in the modern consumer world. Japanese companies have a great history of providing highquality products. What they need to do is change the product mix. Machine tools and drop some of the focus on agricultural for example. David how do you think the market is going to digest this . Save the boj and fed dont move, what will happen . The markets are nervous, jittery. Investors are moving to cash for a number of reasons. They are concerned about the u. S. Political cycle. You might as well sit on the sidelines in cash because you are afraid no matter what it will not be the outcome you want. The same thing here. I think more and more people are sitting on the sidelines. I dont think we will see any announcements that move markets dramatically from the point of view of what the boj will say, but the boj combined with the and u. S. Eserve elections, you will see some huge volatility before the end of the year. David ok. Thank you. We will get more clarity. Rishaad thank you. Next, a chinese billionaires plan to release his property business in china, proving to be tougher than he thought. Details on the way. Rishaad dalian Wanda Wallace dalian wanda dalian Wanda Wallace wang jianlin faces hurdles ahead. Go now . Es mr. Wang back to china go for the listing of the property unit. It is in the process to go back to china. Rishaad there are a lot of Companies Keen to list their, why so many . Stocks, i meann in china, i mean have been trading it really highvalue asians. Then, i mean, the process has been i mean really, really long. Like forfivees years to list in china. Rishaad that is a risk isnt it . The timetable for them as two years, so its pretty aggressive. Rishaad he has also promised her that things should he list again, and those promises could be in danger. The agreement between wanda and investors that support the privatization, so they have to list in china in two years. If it does not happen, i mean wang has to pay back to those investors as much as 5 billion. On the otherng up side of the break, a look at negative rates in japan. What they are doing is squeezing margins. We will be live taking a look at how bad things could get for local banks. Kong,rket open in hong shanghai, opening numbers coming your way as well. ,ust looking at the premarkets down a fraction here in hong kong. Rishaad our top stories, the data fromjaiteh japan disappoints, imports and exports continue their losing streak, exports dropping for an 11 straight month, while imports a 20 straight month decline. Data coming hours before the boj policy meeting winds up with markets waiting for its review of strategy. Steelmakers, a union that would create a larger company. The two will swap shares. The president of china wants to reform the state owned enterprises to deliver up those to the economy. Wells fargo ceo john stumpf criticized by lawmakers. He was questioned after a review found more than 2 million accounts had been open without customer authorization. Senator Elizabeth Warren said, you should quit. She called his leadership as gutless. Off the starting session, but it is about the boj so far. Unsurprisingtirely given the pent up expectation building ahead of this boj rate policy review as well as the Rate Decision coming out over the next couple of hours or so. A lot of investors sitting by the sidelines, lowvolume, but this is what were seeing in terms will what is happening. Of sydney, uput by. 3 , but off session highs. That rebound in oil prices helping Energy Shares and industrials. Elsewhere around the region, looking pretty grim when it comes to Greater China markets, some downside to hong kong markets. Shanghai flat at the moment. Declines, extending also weakness from taiwan and southeast asia, singapore down by. 3 . It is wait and see and till we get something coming through from the boj. That, we willer potentially get a whole new picture when it comes to what the fed will do. A look at dollaryen, range bound. Over the last couple of sessions, not too much in huge moves. Some Dollar Strength earlier. That has come off. We are at 101. 65. Get that ahead of every bank of japan meeting, and this time it was not any exception to that either. A quick check of oil prices. That rebound for wti. We did have that inventory report. It showed quite a massive drawdown in terms of that report, and that does load well for the report coming out in a few hours in the u. S. Session. It is showing essentially the same trend. Also, rumors that opec could turn its informal meeting into a formal session next week. A quick look at some of the movers today. It is focusing on the japanese session. Some names making headlines for all the wrong reasons. Takata dealing with the massive , affecting also some automakers as well. This has resulted in casualties and deaths. They have received five bids for the company, kkr among the suitors as it tries to address mounting liabilities related to the massive global recall of its airbags. Sharp close to session highs, reportedly upgraded sales forecasts, but no confirmation as of yet. That is what is driving those gains in sharp. Up. Ung electronics u. S. Exchange program, 500,000 units of the note seven. Investors probably feeling better with how things are. Finally, we will be watching the japanese banks. We are seeing some downside. Some Smaller Banks down. If these rumors that we may be in negativeher cut rate policy, expect to see a reaction when it comes to the financials, which are already dragging tokyo lower today. Look at the boj in more detail, negative rate make japanese banks the latest short, traders betting against local lenders, saying many could go bankrupt soon. We have more analysis here. What is behind in negative view on the industry there . Interestn to these rate margins being compressed . That is certainly part of it. It is no secret that japanese banks face a difficult environment. The population is declining and aging at rates not seen anywhere else in the world. Rate policy is squeezing margins and making it difficult for them to make returns on deposits they hold. They have done some research on a piece of legislation that came in 2009 that force the banks to adjust terms on loans to small and Medium Enterprises and homeowners. A reportingcaused issue with nonperforming loans. Put all that together, and the idea has been to short the banks. Rishaad i will not pretend to are,the thoughts they begin me an idea of the profitability of the strategy and how it has done so far. It seems to be working for them this year. They made 14 return in the year to august, comparing to the broader index, down 15 . Index was down 28 this morning. In a falling market, the strategy seems to be working. At the moment, they are doing nicely. The banks have not all been down. I guess it is all down to timing, but they seem to have it right at the moment. Rishaad past performance is no guide to the future. What are people saying about their performance in the future . It is anybodys guess. Banks have been driven this year by centralbank policy. It has been expectations which will help the bank driving share prices up, and expectations like this morning with shares down again that perhaps the boj is going to deepen those negative rates, which would be bad for banks. It will send them downward. We are watching the boj closely day to watch and see what happens. Rishaad nice one there. Some other stories we are following. Hasnew york bombing suspect been charged with the blast in manhattan and new jersey. Says he was investigated two years ago after his father said he might the iteris. Investing might be a terrorist. Is also charged with attempting to murder a police officer. Address to the united nations, president obama railed against nationalism and political strongmen. Seen as an attack on donald trump, although he was never mentioned by name. The president defended globalism and said a country ringed by walls would only in prison itself. The former president of brazil is to Face Criminal Charges after a federal judge except that there is sufficient evidence to take it to trial. Was aalleged that there system of kickbacks. He was indicted on separate charges of attempting to obstruct justice. Opec said iran is committed to building a consensus on stabilizing prices. He said the country is willing to do Everything Possible to reach the agreement with members and nonmembers. A formalwell become session depending on how discussions progress. Chinas official Economic Data may not be as move from reality as sometimes thought. Bloomberg intelligence mostlying that it is backed up by the readings from other official gauges. Think,so we always question the veracity of the data, but maybe it is not that far off the mark. Thats right. Big data is certainly helping to guide views on the economy. Toprisingly, they dont seem be all that far away from what the official numbers are showing. Lets have a look at some of the new big data numbers we are seeing. One is a satellite reading from space. It uses algorithms to track signs of manufacturing a riveting in 6000 sites across china. Reading was 50 point two, roughly consistent with the official pmi, so no big cap there. Gap there. Another is the countrys largest payment network, tracking Real Estate Sales and other key aspects. Risingproperty sales 11 , similar to the official data. Bydo gauges consumption tracking visitors to Shopping Centers and other destinations. Mixed, auto sales of strongly in line with official data. Some other readings, malls, restaurant, down, so thats not a good sign for a transitioning economy, then the Employment Index from baidu, Industrial Parks and things like that, it is pretty much in line with what the official statistics which show, although the official statistics are notoriously flat and dont show too much. Industries mayer be shedding workers, but employment doing better elsewhere. Then we have the alibaba internet shopping price index. It is showing inflation more than the official cpi is showing, but that could represent the fierce competition online. Official stats need to be taken more seriously then . It seems to be. One of the main problems for official stats is what it masks, not what it shows. Chinas economy is in this big transition. Some of the stability we see in the officials to statistics which people question is perhaps because some regions are really doing well. , microgranular views, may help us get a better snapshot of those as well. Rishaad good stuff. Up next, a lengthy process, why companies wanting to set up in hong kong might find it tricky to open Bank Accounts there. We will ask our next guess what is causing delays. This is bloomberg. Rishaad right. Business flash headlines. Gold may surge 44 by the end of the year. All of this according to Robert Mcewan who says and just rates will increase anxiety. He sees gold at 1900 by the end of 2016. The metal has jumped more than 20 this year. Exxon mobils acquisition set for a major hurdle wednesday. We have the founder and chief executive saying that most investors will vote in favor. This is despite a twomonth campaign to hold out for a better offer. Did of up to 3. 6 for thiss a poor deal natural gas explorer and he reckons its shareholders are being ripped off. Will add itself to a shopping cart. Intense competition in the city has forced the retailer is backed by a facebook cofounder and has contacted several potential buyers. Well, companies wanting to set up in hong kong often have a bit of a problem. Themselvescorporate and set up the infrastructure to do business, but there are often sirs problems opening a bank account. Often Serious Problems opening a bank account. Lets discuss this from firm. Ate services are doing this under the guise of antiMoney Laundering. That is the pretext. In practice, 98 of our members have discovered that it is very difficult. Rishaad but not impossible. It is not impossible. Institutions,gger they have little problem indeed, but for smaller groups and new entries to asia looking at hong kong and perhaps singapore as an alternative have found a have been turned down in hong kong by a particularly well known banker only to find that same bank will open the account for them in singapore. Rishaad what is the logic then . What makes it profitable to do in singapore to do it in singapore . They call it derisking. Publishedhich was examined in detail the rationale behind this. The banks are anxious. They dont want to take on business that is not profitable if it is anyway risky. Rishaad do you have examples here . I cant name names for obvious reasons. Yes, we have encountered a private equity group that had a choice between hong kong and singapore and chose singapore over hong kong, which is a great shame, because hong kong has been named as one of the freest economies in the world. This seems to be quite contradictory. , doaad lets get to this banks have a moral and social imperative to open up rank accounts for people when they may choose not to . Why should they . A bank is a commercial organization, and it is free to choose with whom it provide services. We would like to think that in hong kong as a free trade economy that Banking Services should be freely available. Of course they have to be appropriately regulated. There is a great deal of concern around Money Laundering and counterterrorist financing at this time, so we have no problem with appropriate checks, but they have to be balanced. The Hong Kong Monetary authority last week issued revised guidance to banks reminding them about the need to be proportionate in their checks and balances. Rishaad ok, well, paul, give me an idea. , but what arepore you seeing on the ground in the asiapacific at the moment . We operate virtually throughout asia. There banke, japan, account opening is equally problematic not as protracted. The sameto go through process, however, in japan, they the ongoing monitoring and operation of the accounts far more onerous. There they have changed the ongoingnd balances to monitoring, which is perhaps more appropriate given what they are trying to catch. Problem fors is a all of these Financial Institutions globally. If you are an american citizen or have assets in the united is an onerous duty they have to report, reporting to the u. S. Treasury department, so you can understand why some would turn away american citizens from opening Bank Accounts for instance. It is just one of numerous pieces of legislation. The uk has its own version. I agree. That is unique for american citizens, but that should not be an impediment towards opening a bank account. Thanks should have a process to deal with these things. I think the pendulum has simply swung too far. Survey ishis essentially about corporates, not individuals, but some individuals i know have had opening Bank Accounts in the territory, and that is not covered in the survey, but does that surprise you . No, it does not surprise me at all. There are a number of reasons why individuals can have problems. A recent High Court Judge recently had his accounts closed because he was deemed to be a politically exposed person. Rishaad what does that mean . He is on a list of andtically exposed persons deemed him unsuitable to have a high street bank account. Rishaad the banks have seen some come through, denied all this, but the point is how does it get addressed if your survey is indeed correct . I believe it is already being addressed. We have spoken to the Hong Kong Monetary authority. We have spoken to the Financial Services treasury bureau. About makingonside sure that there are appropriate checks and balances. Zero breachest a policy imposed. Everybody accepts that a mistake can be made and the bank should not be held totally accountable for this type of problem. There has to be a balance between allowing free trade andss the whole of asia stamping out Money Laundering and counterterrorist financing, which, lets be honest, the big driver behind that is a clamp down on tax avoidance and tax evasion. Rishaad it is probably the way forward and maybe the pendulum as you have suggested has gone too far. Thank you very much indeed. Just ahead, how a relative newcomer could be more viable than the financial industrys most established players. This is bloomberg. Alibabas finance business could be worth more than goldman sachs. Sort of valuation are we talking about . Juliette 75 alien dollars according to analysts. 75 billion according to analyst, more than goldman sachs, which has a value of 70 billion. Most of this valuation comes , the main online payment service, 50 billion according to the numbers is part of their financials. At 8 billion, Wealth Management at 7 billion, the rest in cash and investment. Assessment. St succes is a massivey Distribution Platform for this company. Thisad some are saying will be worth 100 billion, this company, and some are saying it could be higher than that. This would be a massive offering. Juliette one of hong kongs biggest. Those figures dont even include some of the newer offerings, like their Cloud Computing , a valuation of 16. 5 billion, and some analysts say that could grow to 20 billion. Even just a 10 float, the low end for hong kong ipos, that could raise about 6 billion based on june round by the way she ands, so huge stakes for jack markell and alibaba. Jack ma and alibaba. Rishaad thank you very much indeed for that. Making yourg up, mind up time for the bank of japan. So will governor kuroda choose to rock the boat . We head over to tokyo to get a preview of this allimportant decision and markets. They are watching and waiting for this. A check on them as well. This is bloomberg. Announcer from our studios in new york city, this is charlie rose. Marc we begin this evening with the explosion in manhattan on saturday night. Ahmad khan ahami was taken into custody after being wounded in a gunfight with police. Rahami is suspected to have orchestrated the bombings in new york and new jersey over the weekend. The 22yearold was born in afghanistan. He is a natural assistance in according to the f citizen according to the fbi. He was discovered captured in new jersey. You got pulled into