Businessweek joel weber. Lets start with remarks in asia, that bears close watching. Businessweek has been writing about the debt pile up in china. China has been doing something to get rid of that. Joel this is called the year the dog. What we will be talking about is deleveraging. The debt pile up in china is enormous. Theres been a number of people the further away you get from china, the more bearish you get on china, apparently, but for years, people have been calling for something is going to give. It will be bad for the global economy. All eyes on this in general. Where our story picks up on that is talking about, the number is 30 trillion. Thats how much we are talking about here. Its massive. The number people pick up on is 2. 5 gdp. What do you do about that . President xi this year will be about deleveraging, which is what this is about. Julia still providing credit to companies that they are not concerned about, but they are also cracking down on big corporates that have been spending. Joel its not even called corporate anymore. Its conglomerate. A 10 day is one thats making a lot of news right now. Age and a is one its making a lot of news right now. A is one thats making a lot of news right now. Real estate from years ago, theyre selling it off and doing it the big way, 4 billion. Thats part of the story, cracking down on these conglomerates that may be overreached, bringing them back in. Its also cracking down on provinces and statebacked companies who, that is the number one place it gets linked to. Carroll this is the conundrum, right . It starts in china and works its way down. The chinese Central Government sense economic targets. They will wait on politicians to make sure they have those targets. It is key to the communist party, keeping xi in power, keeping the economy going in terms of staying in power. Joel thats where the balancing act comes in. Can they pull it off is the question. That will be something we are all going to be continuing to watch. The ramifications for the global economy, because of the size of chinas economy are massive. Julia china has made it one of the three priorities, poverty, pollution, debt. You see what they are attempting. Carol priority is the right word. Joel i dont want to get out of of his bad graces. [laughter] julia Chinese Workers are operating in a place which is one of the can we say the largest washing machine operation, perhaps . [laughter] joel you can, im not going to say that. Carol we can allege. Julia we can allege. Joel so this story is amazing. It is about an island called saipan. This place is on u. S. Soil. You get on a plane, flight to hawaii, do that again. It puts it right over in asia, and its a little bit closer to asia than the u. S. It is guams neighbor. The story centers on the chinese casino that opens on japan. Its a little fuzzy. Julia its a lot fuzzy. Lets be clear. Its way more financially superior than anything in vegas. Joel macau dwarfs vegas in size of per table numbers. Casinos in japan dwarf that with fewer tables. [laughter] carol right. That alone and the relationship between the company and the u. S. And government officials would be super interesting. Matt campbell went there. We got more from him. Matt saipan is the capital of a pretty obscure american territory called the commonwealth of northern mariana casinos in japan dwarf that with fewer tables. [laughter] carol right. That alone and the relationship between the company and the u. S. And government officials would be super interesting. Matt campbell went there. We got more from him. Matt saipan is the capital of a pretty obscure american territory called the commonwealth of northern Mariana Islands. If you want to see it on a map, youve got to look for guam, then go up to the right. Its an impossibly remote part of the world, 14 time zones from washington. The quickest way to get there is to fly to tokyo, then double back. It has been since the 1970s american soil. It is a place where they use the u. S. Dollar, u. S. Mail, federal law extends there. This is, for all intents and purposes, part of america. Carol talk to us about 2014. Matt the Biggest Issue in the Mariana Islands since the Second World War has been finding an economic purpose. This part of the world has no industrial base, natural resources. Nothing to sustain its economy. There was a Garment Industry in the 1980s really, which became enormous in the 1990s and 2000s, that eventually collapsed. But that meant was the marianas were desperate for cash, they were in a serious financial crisis. What they did is what a lot of outofoptions jurisdictions have done over the years. They looked for a casino. Carol economic answer, isnt it . [laughter] matt its all about the money. Carol right. Matt the casino led to unusual events which are still unfolding. Julia talk to us about those events, and the Company Imperial pacific international. Matt Imperial Pacific international was called first natural foods. They were in the frozen food business. Theyve recently got into the casino business. They were controlled by a mother and son from mainland china. They have certain connections in macau, which is of course the gambling capital of the world. They turned up on saipan in 2014 with amounts of money that this place had never seen before. This is an island where the best hotel is a hyatt from the 1970s. The airport. Its tiny. 50,000 people if that. All of a sudden, you have billionaires from china spending large amounts from the island economy. Carol they have billions of dollars in terms of development. Matt they promised to spend up to 3 billion for now, in terms of development. What is remarkable is as soon as gambling began, a temporary facility, not the casino, the numbers were astounding, the likes of which, when you speak to gaming experts in macau, theyve never seen them before. Julia the financials here are incredible. You say it is past the generation capacity of casinos in macau, way bigger than anything vegas has ever seen. Matt if you look at the comparative numbers here, they do it able to her per table. Thats the important metric. This is a place thats turning over, by some measures, six times more than casinos in macau per table. At one point, this temporary casino, which is about the size of an olive garden, was doing Something Like 1 3 of the volume of the wynn macau, which is one of the biggest casinos in the world. It raised some eyebrows in the industry. Julia could this be done legitimately, if youre talking about chinese billionaires coming to this remote location . What have people said to you about the possibility that this could be legitimate . Matt i spoke to a number of gaming experts and executives. All of them with a lot of experience in asia. They were all deeply, deeply skeptical to say the least of any legitimate explanation for funds like this. Carol what is a legitimate explanation of whats going on . Matt i should say, first of all, Imperial Pacific is complying with all laws. They do not view their volumes as excessive, and there is an entirely above board gaming option. One explanation, macau is a huge center for flight. Some of that capital is something that any law firm has done business, they will tell you macau is a significant venue for money laundering. One of the largest in the world. Thats because theres a lot of money trying to get out of china. A lot of the money is proceeds of corruption, bribery, and it has historically tended to flow in large part through macau. Whether thats going on in saipan, i think, needs to be left to others. Carol why isnt it going to saipan . Matt president xi jinping has been tough on this sort of thing. If you look at the result of macau casino operators over the past few years, they are all the way down from the boom years, which were 2012, 2013. It has gotten tougher to move large amounts of money money through macau. As a result, that money is popping up elsewhere. Julia as youve pointed out, this is u. S. Territory. Could you explain how this effective money washing is working in practice, and does the fact that it is a u. S. Territory aid but the problem is right now for money and macau . Matt well, when you want to get money out of china, the goal is to get it is safe. Julia yeah. Matt or there are property rights. Theres no better place than the United States for property rights. Thats a valuable thing potentially to be able to offer. Theres also a question of, look, banks in asia are really, really, really terrified of being sanctioned by the u. S. Treasury, of ending up on a blacklist. Thats not a fear that is quite so pronounced within the United States, of course. This is all speaking generally, not necessarily about saipan. Carol up next, a wall street titan makes a new bet on banking and italy. Julia an American Chef cashing in in copenhagen. Carol this is Bloomberg Businessweek. Carol welcome back to Bloomberg Businessweek. I am carol massar. Julia im julia chatterley. You can find us online on businessweek. Com. Carol and on our mobile up. Former barclays chief bob diamond is taking on a risky bet. Julia an opportunity for Small Business lending in italy. Heres our reporter, elisa martinuzzi, from milan. Elisa this is with barclays, Investment Banking powerhouse. He has been tiptoeing another business areas. He tried africa in the not so distant past, tried to replicate banking, but it did not quite go according to plan. Its the turn of italy and southern europe. What he sees is the opportunity to fund a business that has been the backbone of italian economy, which is bank lending to small and mediumsized companies. Julia when you think about italy, you think about the struggles of the Banking Sector. Set the scene for us is this situation improving here for nonperforming loans in italy . Elisa i think whats interesting is the timing. For the last couple of years, the focus has been on that banks have built up. As far as investment firms, people coming from outside, the equity funds, the trust funds, they have all been focusing on purchasing some of these bad debts, prices in the hope of being able to sell those and the assets behind them for profit. Now, suddenly, as the economy starts to turn, investors are seeing the opportunity to make money by lending. It is sort of a positive story, very different to the ones that focus on bad loans we have had so far. Julia we can imagine Good Companies there have been starved of credit due to debt. Talk to me about the plan. What has bob diamond invested, and what did he hope to do . Elisa thats exactly it. Taking advantage of the big banks, established players, dealing with a bad loan debt, and are unable to grow their lending book. What hes doing here is investing in a Company Founded by a former ceo of one of italys biggest banks, who was also a foreign minister, who is going to be buying a bank, and they are in a discussion now to purchase that license. They injected 600 Million Euros of capital into that, to try to extend credit, to become a Challenger Bank to mainstream vendors. Julia this is interesting. He has the political leverage here, but he was the former head of a company, and is combining his political knowledge and expertise with Banking Sector expertise in the partner he is choosing here. Elisa absolutely. Hes witnessed coming up from behind, run one of the bigger banks. He was able to cross that bridge and presumably have backing for this venture, and will be negotiating with regulators, for example, in terms of the license purchase. Julia in europe, a profile of rodeo sanchez. Carol shes American Chef with a taste of mexican cuisine. Julia heres our editor chris rovzar. Chris Rocio Sanchez is a young woman who is opening restaurants in copenhagen. Maybe thats something i wont not be familiar with soon, but shes got this incredible career. Shes 32 years old, she has cooked in some of the most incredible kitchens around the world. Julia incredible, at the fat duck, in london, at noma, in denmark, the denmark connection. Chris exactly. She worked for several years at a place, widely regarded the best restaurant in the world. She took that knowledge and brought it to her own place. Shes causing a sensation. Julia i mean, this is a strange path shes taken. She was a daughter of mexican immigrants, grew up in chicago. She now finds herself in copenhagen with three restaurants at 32. Chris it wasnt something she imagined as a little kid. Shes very funny, nononsense. When she was talking to a reporter, she said i never thought i would be a chef, i was just a fat girl. I liked cake. Julia [laughs] chris she went to a Vocational School outside of chicago, learned how to cook, she learned pastry making. She started interning around the world at some places, then she got a call from noma, and said it was like getting the call to tour with beyonce. She said thats what im doing all right, thats what she was doing, and she worked there for several years. Julia one thing that stood out was the chocolate chili, obviously. Chris yes, the chilichocolate popsicles. One of my coworkers had them, its amazing. She did a pop up at shake shack in new york. I went down and had a breakfast taco she made with cured bacon and egg yolks, which sounds weird. Julia yes. Chris but was really delicious. They did a pop up, and were selling at 7 30, and they were sold out a 9 00 a. M. Julia this is very unique here, with its also it takes something getting used to, i think. The flavors seem to be going well with people. Chris the fried pork skins is a mexican, traditional food. When she is in copenhagen, she cant get tomatillos or some of the traditional ingredients she would use if she was here. She uses gooseberries, and that adds a danish spin on the mexican dishes. Julia so what does the future hold . Chris she has also become a sensation, because she hires a lot of women chefs. Julia yeah. Chris she got a lot of attention for that. When she started her first taqueria, she hired all women chefs. She didnt want to get into a whole thing about women in kitchens, and you know, any of the controversy there. Shes just trying to hire women chefs. She found women she liked and hired them. Now, shes got a mix. Shes got a little crazy. [laughter] chris shes hired a lot more women in her kitchen than a lot of other european kitchens. Carol up next, steve bannon finds reason to address the Metoo Movement. Julia this is Bloomberg Businessweek. Julia welcome back to Bloomberg Businessweek. Im julia chatterley. Carol im carol massar. You can also listen to us on radio on sirius xm channel 119, and on and a. M. 1130 in new york, 106. 1 in boston, 91 fm and washington, d. C. , and a. M. 960 on the bay area. Julia and in london on dmu x3, and on bloomberg on the radio plus. Exhouse adviser steve bannon sees a problem on the horizon for president trump. Carol we are not talking about russia, we are talking about the Metoo Movement. Matthew its the night of january 7. Hes at the back room of the townhouse, where he lives near capitol hill. We are only a few days after the publication of Michael Wolffs book, in which steve bannon rips apart the white house, and the president gets publicly excommunicated, not just by the white house, but eventually loses his ties to breitbart. He is sitting in the aftermath of this, watches the golden globes. He watches the ceremony of all the womens power movement, and the backlash, an embodiment of the Metoo Movement. He has this oh, my gosh moment. This is the next political backlash that is going to, you know, sweep washington and away the institutions. Of course, hes the guy who harnessed the last one, the populist kind of nationalist movement. Hes telling josh, who, you know, as they are watching this, this is a seminal moment. The irony of course is this is coming just as bannon has been exiled out of the white house. This could do potential damage for the republicans in 2018. Julia he declared its a cromwell moment, were talking oliver cromwell. Puritan, 17th century u. K. What did he mean by that, and where does he see the danger . Matthew he sees this as an antipatriarchy movement thousands of years in the making. The irony, perhaps the power of this, he sees donald trump as the embodiment that so much of the Metoo Movement is aimed against, this antimale establishment. As he tells josh, donald trump the perfect villain. He really sees this in broad, historical sweep. Hes never short for a way to look at a historical moment and find some random theme. In this case, the puritanical movement of cromwell. These women in black dresses, all my god, this is antipatriarchy, antimale. Its big and its, you know, hundreds of years in the making, and theres no stopping it. Julia for a lot of people, that night, Natalie Portman it was quite jarring. She made it more than the me too she made it antimale. Then, you tie that to rob porter, and what weve seen over the last few weeks. You feel like thats a fuel on the fire moment for the administration. Matthew thats right. After the golden globes, you have the rob porter scandal, allegations of Domestic Violence with rob porter. The white house handled that, it was bad on every front. They seem to have known for quite a while this was an issue in his past. They held up his security clearance. The fbi had flagged it, too. A number of people, including chief of staff john kelly. The initial reaction was these are allegations that are not founded in reality. This is exactly what bannon is talking about, which is this white house in particular seems illequipped to deal with this movement, in particular. And look, it is kind of a chicken and egg thing about which came first, whether the womens march that happened the week after the inaugur